What changed in this filing

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Item 1. Business

2022-02-24 compared with 2021-02-24 · 193 added, 134 removed, 559 unchanged (37% of the section changed)

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CareDx, Inc., or “CareDx” or the “Company” or “we” or “us” and “our”, together with our subsidiaries, is a leading precision medicine company focused on the discovery, development and commercialization of clinically differentiated, high-value diagnostic solutions for transplant patients and caregivers.

We offer testing services, products, and digital solutions along the pre- and post-transplant patient journey, and are a leading provider of genomics-based information for transplant patients.

We offer testing services, products, and patient and digital solutions along the pre- and post-transplant patient journey, and we are a leading provider of genomics-based information for transplant patients.

Our headquarters are in South San Francisco, California.

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Fremantle, Australia and Stockholm, Sweden.

Our commercially available testing services consist of AlloSure® Kidney, which is a donor-derived cell-free DNA, or dd-cfDNA solution for kidney transplant patients, AlloMap® Heart, which is a gene expression solution for heart transplant patients, and AlloSure® Heart, which is a dd-cfDNA test that can identify underlying cell injury leading to organ rejection.

We have initiated several clinical studies to generate data on our existing and planned future testing services.

In April 2020, we announced our first biopharma research partnership for AlloCell, a surveillance solution that monitors the level of engraftment and persistence of allogeneic cells for patients who have received cell therapy transplants.

Our commercially available testing services consist of AlloSure® Kidney, a donor-derived cell-free DNA, or dd-cfDNA solution for kidney transplant patients, AlloMap® Heart, a gene expression solution for heart transplant patients, AlloSure® Heart, a dd-cfDNA solution for heart transplant patients, and AlloSure® Lung, a dd-cfDNA solution for lung transplant patients.

We have initiated clinical studies to generate data on our existing and planned future testing services.

We have signed multiple biopharma research partnerships for AlloCell, a surveillance solution that monitors the level of engraftment and persistence of allogeneic cells for patients who have received cell therapy transplants.

We also offer high-quality products that increase the chance of successful transplants by facilitating a better match between a donor and a recipient of stem cells and organs.

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and XynManagement, Inc., or XynManagement.

During the year 2020, we performed more than 79,000 commercial AlloSure Kidney, AlloMap Heart and AlloSure Heart tests from our Brisbane, California, laboratory.

We have since increased our offerings in patient and digital solutions with the 2021 acquisitions of TransChart LLC, or TransChart, MedActionPlan.com, LLC, or MedActionPlan, and The Transplant Pharmacy, or TTP.

During 2021, we performed more than 153,000 commercial tests from our Brisbane, California, laboratory.

According to the U.S.

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Testing Services

We develop and provide a diagnostic surveillance testing service for kidney and heart transplant recipients.

We develop and provide diagnostic surveillance testing services for solid organ transplant recipients, hematopoietic stem cell transplant recipients and recipients of engineered cell therapies.

AlloSure Kidney, our transplant surveillance solution, was commercially launched in October 2017 and is our dd-cfDNA offering built on a Next Generation Sequencing, or NGS, platform.

In transplantation, 109 papers from 55 studies globally have shown the value of dd-cfDNA in the management of solid organ transplantation.

In transplantation, more than 100 papers from over 50 studies globally have shown the value of dd-cfDNA in the management of solid organ transplantation.

AlloSure Kidney is able to discriminate dd-cfDNA from recipient-cell-free DNA, targeting polymorphisms between donor and recipient.

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The Medicare reimbursement rate for AlloSure Kidney is currently $2,841.

AlloSure Kidney has received positive coverage decisions from Blue Cross Blue Shield, or BCBS of South Carolina, BCBS of Kansas City and Capital Health, and is reimbursed by other private payers on a case-by-case basis.

AlloSure Kidney has received positive coverage decisions from several commercial payers, and is reimbursed by other private payers on a case-by-case basis.

Multiple studies have demonstrated that significant allograft injury can occur in the absence of changes in serum creatinine.

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Monitoring of graft injury through AlloSure Kidney allows clinicians to optimize allograft biopsies, identify allograft injury and guide immunosuppression management more accurately.

Since the analytical validation paper in the Journal of Molecular Diagnostics in 2016, before the commercial launch of AlloSure Kidney, there has been an increasing body of evidence supports the use of AlloSure Kidney dd-cfDNA in the assessment and surveillance of kidney transplants.

Bloom et al, the lead authors on the cfDNA and Active Rejection in Kidney Allografts paper, evaluated 102 kidney recipients and demonstrated that dd-cfDNA levels could discriminate accurately and non-invasively distinguish rejection from other types of graft injury.

In contrast, serum creatinine has area under the curve, or AUC, of 50%, showing no significant difference between patients with and without rejection.

Multiple publications and abstracts have shown AlloSure Kidney’s value in the management of BK viremia, as well as numerous pathologies that cause molecular inflammation and injury such as DSAs and eGFR decline.

Most recently its utility in the assessment of T-cell mediated rejection (TCMR) 1A and borderline rejection has also been published in the American Journal of Transplant, or the AJT.

The prospective multicenter trial, the Kidney Allograft Outcomes AlloSure Kidney Registry stud y, or K-OAR, has enrolled over 1,700 patients, with plans to survey patients with AlloSure Kidney for 3 years and provide further clinical utility of AlloSure Kidney in the surveillance of kidney transplant recipients.

KidneyCare combines the dd-cfDNA analysis of AlloSure Kidney with the gene expression profiling technology of AlloMap Kidney and the predictive artificial intelligence technology of KidneyCare iBox in one surveillance solution.

We have not yet made any applications to private payers for reimbursement coverage of AlloMap Kidney or KidneyCare iBox.

Since t he analytical validation paper in the Journal of Molecular Diagnostics in 2016 before the commercial launch of AlloSure Kidney, there has been an increasing body of evidence supporting the use of AlloSure Kidney dd-cfDNA in the assessment and surveillance of kidney transplants.

Bloom et al evaluated 102 kidney recipients and demonstrated that dd-cfDNA levels could discriminate accurately and non-invasively distinguish rejection from other types of graft injury.

In contrast, serum creatinine has area under the curve of 50%, showing no significant difference between patients with and without rejection.

publications and abstracts have shown AlloSure Kidney’s value in the management of BK viremia, as well as numerous pathologies that cause molecular inflammation and injury such as DSAs and eGFR decline.

Most recently its utility in the assessment of T-cell mediated rejection (TCMR) 1A and borderline rejection was published in the American Journal of Transplant, or AJT, and the largest prospective cohort of over 1,000 patients with long term outcomes by Bu et al was published in Kidney International 2022.

The prospective multicenter trial, the Kidney Allograft Outcomes AlloSure Kidney Registry study, or K-OAR study, has enrolled over 1,700 patients, with plans to survey patients with AlloSure Kidney for 3 years and provide further clinical utility of AlloSure Kidney in the surveillance of kidney transplant recipients.

Preliminary results from the K-OAR study were presented at the CareDx Symposium at the American Transplant Congress held in June 2021 and demonstrated:

• Implementation of AlloSure surveillance does not adversely impact 12-month eGFR.

• AlloSure is not affected by Interstitial Fibrosis and Tubular Atrophy, or IFTA – higher grades of IF/TA were not associated with increased AlloSure scores.

• Fewer biopsies - fewer patients in the KOAR cohort required one or more allograft biopsy compared to the DART surveillance cohort.

• AlloSure-guided biopsies are higher yield – the number of for-cause (clinically indicated) biopsies performed was similar to that seen in DART, but AlloSure-guided biopsies demonstrated higher yield for actionable findings .

• Higher AlloSure with transplant glomerulopathy – Transplant glomerulopathy relatively uncommon on biopsies within 1 year but a trend towards higher AlloSure scores when identified.

• Excellent graft and patient survival - graft survival slightly higher than contemporary United Network for Organ Sharing (UNOS) patient population, despite being a slightly higher risk cohort.

• Validated, reproducible performance - overall performance of AlloSure similar to that seen in other large cohorts, including DART and ADMIRAL.

We have not yet made any applications to private payers for reimbursement coverage of AlloMap Kidney or iBox.

In September 2019, we announced the enrollment of the first patient in the Outcomes of KidneyCare on Renal Allografts, or OKRA, study, which is an extension of the K-OAR study.

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The 510(k) clearance from the FDA is also for an In Vitro Diagnostic Multivariate Index Assay, or IVDMIA.

AlloMap Heart Score Variability, or AMV, is an additional service we offer providing complementary information to help personalize long-term care of heart transplant recipients.

AlloMap Heart Score Variability, or AMV, is an additional service we offer, which provides complementary information to help personalize long-term care of heart transplant recipients.

It is available only upon request by clinicians.

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AlloMap Heart has also received positive coverage decisions for reimbursement from many of the largest U.S.

private payers, including Aetna, Cigna, Health Care Services Corporation, or HCSC, Humana, Kaiser Foundation Health Plan, Inc., or Kaiser, several BCBS plans and UnitedHealthcare.

private payers.

In October 2020, AlloSure Heart received a final Palmetto MolDx Medicare coverage decision for AlloSure Heart.

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The Medicare reimbursement rate for AlloSure Heart is currently $2,753.

AlloSure Heart has received positive coverage decisions from several commercial payers.

We have also successfully completed several landmark clinical trials in the transplant field demonstrating the clinical utility of AlloMap Heart for surveillance of heart transplant recipients.

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The results of our clinical trials have also been presented at major medical society congresses.

AlloMap Heart is now recommended as part of the International Society for Heart and Lung Transplantation, or ISHLT, guidelines.

AlloMap Heart is now recommended as part of the ISHLT (International Society for Heart and Lung Transplantation) guidelines.

HeartCare includes the gene expression profiling technology of AlloMap Heart with the dd-cfDNA analysis of AlloSure Heart in one surveillance solution.

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(i) AlloMap Heart – a measure of immune activation, and (ii) AlloSure Heart – a measure of graft injury.

Clinical validation data from the Donor-Derived Cell-Free DNA-Outcomes AlloMap Registry (NCT02178943), or D-OAR, was published in AJT in 2019.

Clinical validation data from the Donor-Derived Cell-Free DNA-Outcomes AlloMap Registry (NCT02178943), or D-OAR, was published in the AJT in 2019.

D-OAR was an observational, prospective, multicenter study to characterize the AlloSure Heart dd-cfDNA in a routine, clinical surveillance setting with heart transplant recipients.

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In February 2019, AlloSure ® Lung became available for lung transplant patients through a compassionate use program while the test is undergoing further studies.

One of these studies, launched in April 2020, is the ALARM study, or AlloSure Lung Allograft Remote Monitoring, with Johns Hopkins University, where the impact of AlloSure Lung combined with RemoTraC will be measured.

One of these studies ALARM, published in The Journal of Heart and Lung Transplantation in 2022, highlights the value of AlloSure Lung Allograft Remote Monitoring, in over 100 lung transplant recipients, where the impact of AlloSure Lung was combined with RemoTraC.

AlloSure Lung applies proprietary NGS technology to measure dd-cfDNA from the donor lung in the recipient bloodstream to monitor graft injury.

In June 2020, we submitted an application to the Palmetto MolDx Technology Assessment program seeking coverage and reimbursement for AlloSure Lung.

In October 2021, we launched AlloSure Lung as part of the CHEST 2021 Annual Meeting.

We have gained early adoption with some commercial payers.

Cellular Therapy

In April 2020, we initiated a research partnership for AlloCell, a surveillance solution that monitors the level of engraftment and persistence of allogeneic cells for patients who have received cell therapy transplants.

AlloCell will initially be commercialized through collaborative research agreements with biopharma companies developing cell therapies.

AlloCell is being commercialized through research agreements with biopharma companies developing cell therapies.

In 2021, we executed multiple additional agreements with biopharma therapeutics companies to use AlloCell in research and clinical studies.

In July 2021, we launched the Assessing Chimerism and Relapse of Bone marrow/ HCT transplant using AlloHeme Testing, or ACROBAT, study.

The ACROBAT study is a prospective, multicenter, observational cohort study to evaluate the use of AlloHeme, a microchimerism NGS tool to predict post-transplant relapse in patients with allogeneic hematopoietic cell transplants, or HCT.

We develop, manufacture, market and sell products that increase the chance of successful transplants by facilitating a better match between a solid organ or stem cell donor and a recipient, and help to provide post-transplant surveillance of these recipients.

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Olerup SSP ® is used to type HLA alleles based on the sequence specific primer, or SSP, technology.

Olerup SBT is a complete product range for sequence-based typing of HLA alleles.

On May 4, 2018, we entered into a license agreement with Illumina, Inc., or Illumina, which provides us with worldwide distribution, development and commercialization rights to Illumina’s NGS products and technologies for use in transplantation diagnostic testing, or the Illumina Agreement.

On May 4, 2018, we entered into a license and collaboration agreement with Illumina, Inc., or Illumina, which provides us with worldwide distribution, development and commercialization rights to Illumina’s NGS products and technologies for use in transplantation diagnostic testing.

On June 1, 2018, we became the exclusive worldwide distributor of Illumina’s TruSight HLA product line.

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AlloSeq Tx, a high-resolution HLA typing solution, AlloSeq cfDNA, our surveillance solution designed to measure dd-cfDNA in blood to detect active rejection in transplant recipients, and AlloSeq HCT, a NGS solution for chimerism testing for stem cell transplant recipients.

In September 2019, we commercially launched AlloSeq cfDNA during the European Society for Organ Transplantation, or ESOT, Congress.

AlloSeq cfDNA is our surveillance solution designed to measure dd-cfDNA in blood to detect active rejection in transplant recipients, and we received CE mark authorization on January 10, 2020.

AlloSeq cfDNA is now commercially available for transplant patients outside of the U.S.

In September 2019, we commercially launched AlloSeq cfDNA, our surveillance solution designed to measure dd-cfDNA in blood to detect active rejection in transplant recipients, and we received CE mark authorization on January 10, 2020.

Our ability to increase the clinical uptake for AlloSeq cfDNA will be a result of multiple factors, including local clinical education, customer lab technical proficiency and levels of country-specific reimbursement.

Also in September 2019, we commercially launched AlloSeq Tx during the American Society for Histocompatibility and Immunogenetics, or ASHI, and Banff Foundation for Allograft Pathology’s Joint meeting in Pittsburgh, PA.

AlloSeq Tx is the first of its kind NGS high-resolution HLA typing solution utilizing hybrid capture technology.

This technology enables the most comprehensive sequencing, covering more of the HLA genes than current solutions and adding coverage of non-HLA genes that may impact transplant patient matching and management.

Also in September 2019, we commercially launched AlloSeq Tx, the first of its kind NGS high-resolution HLA typing solution utilizing hybrid capture technology.

This technology enables the most comprehensive sequencing, covering more of the HLA genes than other solutions on the market and adding coverage of non-HLA genes that may impact transplant patient matching and management.

AlloSeq Tx has simple NGS workflow, with a single tube for processing and steps to reduce errors.

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This technology has the potential to provide better sensitivity and data analysis compared to current solutions on the market.

Digital and Other

In 2019, we began providing digital solutions to transplant centers following the acquisition of Ottr Complete Transplant Management, or Ottr, Inc., and the acquisition of XynManagement, Inc., or XynManagement.

In March 2021, we acquired certain assets of BFS Molecular S.R.L., or BFS Molecular, a software company focused on NGS-based patient testing solutions.

BFS Molecular brings extensive software and algorithm development capabilities for NGS transplant surveillance products.

Patient and Digital Solutions

In 2019, we began providing digital solutions to transplant centers following the acquisition of Ottr Complete Transplant Management, or Ottr, Inc., and the acquisition of XynManagement.

On May 7, 2019, we acquired 100% of the outstanding common stock of Ottr, Inc.

was formed in 1993 and is a leading provider of transplant patient tracking software, or the Ottr software, which provides comprehensive solutions for transplant patient management.

was formed in 1993 and is a leading provider of transplant patient management software, or the Ottr software, which provides comprehensive solutions for transplant patient management.

The Ottr software enables integration with electronic medical records, or EMR, systems, including Cerner Corporation, or Cerner, and Epic Systems Corporation, or Epic, providing patient surveillance management tools and outcomes data to transplant centers.

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In September 2020 we launched AlloCare, a mobile app that provides a patient-centric resource for transplant recipients to manage medication adherence, coordinate with Patient Care Managers for AlloSure scheduling and measure health metrics.

In January 2021, we acquired TransChart.

TransChart provides EMR software to hospitals throughout the United States to care for patients who have or may need an organ transplant.

As part of this acquisition of TransChart in January 2021, we acquired Tx Access, a cloud-based service that allows nephrologists and dialysis centers to electronically submit referrals to transplant programs, closely follow and assist patients through the transplant waitlist process, and ultimately, through transplantation.

In June 2021, we acquired the Transplant Hero patient application.

The application helps patients manage their medications through alarms and interactive logging of medication events.

Also in June 2021, we entered into a strategic agreement with OrganX to develop clinical decision support tools across the transplant patient journey.

Together, we and OrganX will develop advanced analytics that integrate AlloSure, the first transplant

specific dd-cfDNA assay, with large transplant databases to provide clinical data solutions.

This partnership delivers the next level of innovation beyond multi-modality by incorporating a variety of clinical inputs to create a universal composite scoring system.

In November 2021, we acquired MedActionPlan, a New Jersey-based provider of medication safety, medication adherence and patient education.

MedActionPlan is a leader in patient medication management for transplant patients and beyond.

In December 2021, we acquired TTP, a transplant focused pharmacy located in Mississippi.

TTP provides individualized transplant pharmacy services for patients at multiple transplant centers located throughout the U.S.

COVID-19 Pandemic

On January 30, 2020, the World Health Organization, or the WHO, announced a global health emergency because of a new strain of coronavirus, or COVID-19, originating in Wuhan, China and the risks to the international community as the virus spreads globally beyond its point of origin.

In March 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally.

The full impact of the COVID-19 pandemic, including the impact associated with preventative and precautionary measures that we, other businesses and governments are taking, continues to evolve as of the date of this report.

The full impact of the continued COVID-19 pandemic, including the impact associated with preventative and precautionary measures that we, other businesses and governments have taken and continue to take, continues to evolve as of the date of this report.

As such, it is uncertain as to the full magnitude that the pandemic will have on us, but the pandemic may materially affect our financial condition, liquidity and future results of operations.

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Based on existing and new relationships with partners, we have established a nationwide network of more than 10,000 mobile phlebotomists.

Following the introduction of RemoTraC and with the easing of stay-at-home restrictions and the opening up of many hospitals to non-COVID-19 patients, our testing services volumes returned to levels consistent with those experienced immediately prior to the COVID-19 pandemic, and through December 31, 2020, volumes continued to be at or above those levels since May 2020.

In spite of the resurgence of COVID-19 infection rates, which resulted in increased stay-at-home and renewed travel restrictions, our testing services did not experience a decrease in testing services volumes.

In spite of the resurgence of COVID-19 infection rates, which resulted in increased stay-at-home and renewed travel restrictions, we did not experience a decrease in testing services volumes.

Our product business experienced a reduction in forecasted sales volume throughout the second and third quarters of 2020, as we were unable to undertake onsite discussions and demonstrations of our recently launched NGS products, including AlloSeq Tx 17, which was awarded CE mark authorization in May 2020.

Our product business maintained normal sales volumes during the fourth quarter of 2020.

Our product business regained normalized sales volumes during the fourth quarter of 2020.

We are maintaining our testing, manufacturing, and distribution facilities while implementing specific protocols to reduce contact among our employees.

In areas where COVID-19 impacts healthcare operations, our field-based sales and clinical support teams are supporting providers through telephone and online platforms.

In August 2020, the state of California released revised criteria for loosening and tightening restrictions on certain activities on generally a county-by-county basis.

Under the updated executive orders, San Mateo County, where our laboratory and headquarters are located, continues to be subject to certain restrictions.

These orders and others may be further modified, amended and adopted depending upon the COVID-19 transmission rates in our county and state, as well as other factors.

In areas where COVID-19 impacts healthcare operations, our field-based sales and clinical support teams are supporting providers through virtual platforms.

Although the executive orders that placed certain restrictions on operations in San Mateo County and the State of California, where our laboratory and headquarters are located, were lifted effective June 15, 2021, new orders or restrictions may be adopted in the future depending upon the COVID-19 transmission rates in our county and state, as well as other factors.

In addition, we have created a COVID-19 task force that is responsible for crisis decision making, employee communications, enforcing pre-arrival temperature checking, daily health check-ins and enhanced safety training/protocols in our offices for employees that do not work from home.

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In April 1999, we changed our name to BioCardia, Inc., and in June 2002, we changed our name to Expression Diagnostics, Inc.

In July 2007, we changed our name to XDx, Inc.

In July 2007,

we changed our name to XDx, Inc.

and in March 2014, we changed our name to CareDx, Inc.

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In March 2017, the Journal of the American Society of Nephrology published the article Cell-Free DNA and Active Rejection in Kidney Allografts.

The article reports that increased levels of dd-cfDNA detected using AlloSure Kidney are associated with active rejection of the kidney allograft.

The article reported that increased levels of dd-cfDNA detected using AlloSure Kidney are associated with active rejection of the kidney allograft.

The Diagnosing Acute Rejection in Kidney Transplant Recipients, or DART, study evidence suggests that AlloSure Kidney, a non-invasive blood test, may enable more frequent, quantitative, and safer assessment of allograft rejection and injury.

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In January 2018, we initiated the “K-OAR” study to develop additional data on the clinical utility of AlloSure Kidney for surveillance of kidney transplant recipients.

K-OAR is a multicenter, non-blinded, prospective observational cohort study which has enrolled more than 1,700 renal transplant patients who will receive AlloSure Kidney long-term surveillance.

In September 2019, we announced the commencement of the “OKRA” study, which is an extension of K-OAR.

OKRA is a prospective, multi-center, observational, registry of patients receiving KidneyCare for surveillance.

We have not yet made any applications to private payers for reimbursement coverage of AlloMap Kidney or KidneyCare iBox.

Enrollment for OKRA was negatively affected by the COVID-19 restrictions during the year 2020 and the study has been delayed by six months;

however, the collection of samples is currently at normal levels as a result of the introduction of RemoTraC.

KidneyCare combines the dd-cfDNA analysis of AlloSure Kidney with the gene expression profiling technology of AlloMap Kidney and the predictive

artificial intelligence technology of iBox for a multimodality surveillance solution.

We have not yet made any applications to private payers for reimbursement coverage of AlloMap Kidney or KidneyCare.

In December 2021, Kidney International published the article Clinical outcomes from the assessing donor derived cell free DNA monitoring Insights of kidney Allografts with Longitudinal surveillance (ADMIRAL).

The article reports that increased levels of dd-cfDNA detected using AlloSure Kidney are associated with active rejection of the kidney allograft.

ADMIRAL supports the work of DART further clinically validating the utility in a cohort of 1092 patients.

The high-level summary of the manuscript shows:

• Use in both subclinical and clinical rejection:

Elevated AlloSure (≥ 0.5%) strongly correlated with clinical and subclinical allograft rejection (p<0.001);

• Predictor of de novo donor-specific antibody (dnDSA):

AlloSure associated with a 271% increased risk of development of dnDSA (p=0.001);

• Associated with development of dnDSA:

Elevated AlloSure levels ≥ 0.5% was associated with 3 times increase in the risk of development of dnDSA;

• AlloSure as a leading indicator:

AlloSure was elevated 91 days (median) ahead of DSA identification;

• AlloSure is superior to serum creatinine (AUC of 80% v 49% respectively);

• Identifies eGFR decline:

Persistently elevated AlloSure (>1 result above 0.5%) predicted a > 25% decline in eGFR over 3 years (HR 1.97, p = 0.041), while persistently low levels identify allograft quiescence;

• AlloSure d ifferentiates rejections which are going to cause long term damage vs short term rejection, which has treatment implications:

oral outpatient treatment vs inpatient, expensive and potentially harmful therapies.

The clinical validation and utility of AlloMap Heart is supported by a number of major clinical trials involving more than 2,000 heart transplant recipients and published in leading peer-reviewed medical journals.

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HeartCare combines the gene expression profiling technology of Al loMap Heart with the dd-cfDNA analysis of AlloSure ® Heart in one surveillance solution.

Our suite of AlloSeq products are commercial “NGS”-based kitted solutions that we have developed as a result of the Illumina Agreement.

Our s uite of AlloSeq products are commercial “NGS”-based kitted solutions.

These products include:

AlloSeq ™ Tx, a high-resolution “HLA” typing solution, AlloSeq ™ cfDNA, a surveillance solution designed to measure dd-cfDNA in blood to detect active rejection in transplant recipients, and AlloSeq ™ HCT, a solution for chimerism testing for stem cell transplant recipients.

Our other HLA typing products include:

Our ot her HLA typing products include:

TruSight HLA, a NGS-based high resolution typing solution;

Olerup SSP, based on the “SSP” technology;

and QTYPE, which uses real-time “PCR” methodology, to perform HLA typing at a low to intermediate resolution for samples that require a fast turnaround time.

and QTYPE, which uses real-time “PCR” methodology, to perform HLA typing.

QTYPE was commercially launched at the end of September 2016.

QTYPE enables HLA typing at a low to intermediate resolution for samples that require a fast turn-around-time and uses real-time PCR methodology.

QTYPE primarily focuses on low to intermediate resolution typing where high-resolution typing is not a requirement but even more rapid typing results are required, such as for deceased donor typing.

When transplanting organs from deceased donors it is of great importance to be able to expediently carry out HLA typing to find an appropriate recipient.

QTYPE primarily focuses on low to intermediate resolution typing where high-resolution typing is not a requirement but even more rapid typing results are

required, such as for deceased donor typing.

Typing with QTYPE requires approximately one hour compared to the up to 2-3 hours that it takes to do traditional SSP typing and the 5-7 hours that it takes with sequence-specific oligonucleotides, or SSO.

QTYPE comes with custom software, SCORE6.

Olerup SSP is used to type HLA alleles based on the SSP technology.

The Olerup SSP product line comprises products for low to high-resolution HLA typing.

The product line includes close to 400 different typing products, covering the approximately 17,331 different HLA alleles (gene variants) that have been identified to date.

New HLA alleles are identified frequently and the typing kits are routinely updated for new alleles.

SCORE6, our custom developed software simplifies interpretation and documentation of laboratory results.

The product line includes close to 400 different typing products.

We offer one of the most up-to-date and comprehensive libraries of HLA typing kits based on SSP technology.

Olerup SBT is a sequence-based typing product for HLA alleles that uses specifically designed software, Assign SBT, a sequence analysis software program that provides high-resolution HLA typing.

TruSight HLA is high-resolution solution that uses NGS methodology.

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Clinical operations dedicated to the design and implementation of high quality studies and registries for data collection to develop evidence to address unmet clinical needs of transplant recipients are included in research and development.

One area of focus for research and development activities has been to integrate acquired technology from the acquisitions of Ottr, Inc.

and XynManagement and our Cibiltech Agreement.

One area of focus for research and development activities has been to integrate acquired technology from the acquisitions of Ottr, Inc., XynManagement, TransChart and MedActionPlan and pursuant to our license and collaboration agreement with Cibiltech SAS.

Integration of such technology with our current service offerings aligns a rich data set with augmented intelligence tools to better assess risk and help physicians better manage their daily patient care.

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Our ongoing efforts include:

• increasing understanding of biological processes of transplant rejection through analysis of genes/metagenes of ongoing clinical trials such as K-OAR and OKRA, and commercial laboratory testing to further improve clinical utility of AlloSure Kidney and KidneyCare;

• validation and clinical utility studies of AlloSure Kidney for other organs such as lung, pancreas and liver;

• increasing understanding of biological processes of transplant rejection through analysis of genes/metagenes of archived clinical trials, OAR registry, SHORE registry and commercial laboratory testing to further improve clinical utility of AlloMap Heart and AlloSure Heart;

• increasing understanding of biological processes of transplant rejection through analysis of genes/metagenes in ongoing clinical trials such as K-OAR and OKRA, and commercial laboratory testing to further improve clinical utility of AlloSure Kidney and KidneyCare;

• validation and clinical utility studies of AlloSure for other organs such as lung, pancreas and liver;

• increasing understanding of biological processes of transplant rejection through analysis of genes/metagenes in archived and ongoing clinical trials, OAR registry, SHORE registry and commercial laboratory testing to further improve clinical utility of AlloMap Heart and AlloSure Heart;

• technology platform and procedure optimization as well as further advances of laboratory information management to increase efficiency and lower costs in our testing and laboratory operations;

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• developing solutions for monitoring the success of hematopoietic stem cell transplantation;

• developing HistoMap to identify allograft rejection in transplant biopsy tissue;

• developing an NGS transplant genetic matching system that includes critical genes in addition to HLA;

• developing solutions to identify allograft rejection in transplant biopsy tissue;

• further development of QTYPE to expand its addressable market by including additional genetic content;

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• developing and deploying smart analytics and machine learning artificial intelligence that provide clinical utility with respect to patient health such as AiTraC;

• developing solutions for assessment of infection in transplant recipients.

Testing Services Advancement and Development

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dd-cfDNA for Kidney Transplants

Our published DART clinical study has established the clinical validity of a dd-cfDNA-based solution for kidney transplant patients, AlloSure Kidney.

This was the first report to establish clinical performance characteristics for this molecular biomarker in renal transplant patients with an analytically validated assay of dd-cfDNA in the largest (N =398 patients) prospective, multicenter observational study of dd-cfDNA.

Our published DART and Assessing AlloSure Dd-cfDNA Monitoring Insights of Renal Allografts With Longitudinal Surveillance (ADMIRAL) clinical studies have established the clinical validity of a dd-cfDNA-based solution for kidney transplant patients, AlloSure Kidney.

DART was the first report to establish clinical performance characteristics for this molecular biomarker in renal transplant patients with an analytically validated assay of dd-cfDNA (N =398 patients) from a prospective, multicenter observational study of dd-cfDNA.

The study population is representative of the spectrum renal transplant recipients in the United States.

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OKRA is a multicenter, prospective, observational registry, designed to measure outcomes of kidney transplant recipients managed with KidneyCare.

KidneyCare complements AlloSure Kidney to include multimodality testing with the addition of AlloMap Kidney Gene Expression Profiling and prognostic graft assessment using KidneyCare iBox.

KidneyCare complements AlloSure Kidney to include multimodality testing with the addition of AlloMap Kidney Gene Expression Profiling and prognostic graft assessment using iBox.

The patient transplant registry is statistically powered to determine the utility of KidneyCare and provide real world data on the use of KidneyCare and AlloSure Kidney.

OKRA targets more than 50 transplant centers and will enroll approximately 1,500 newly transplanted patients, complementing the K-OAR with 1,500 patients, matching both arms with a total of 1,000 control patients.

The ADMIRAL article reports that increased levels of dd-cfDNA detected using AlloSure Kidney are associated with allograft rejection.

The long term utility shown in a cohort of 1,092 patients supports the work of all of the publications prior to this.

The use of routine monitoring of AlloSure after kidney transplant may allow clinicians to identify subclinical allograft injury and intervene prior to development of a clinically evident graft injury.

To evaluate this, data from 1,092 kidney transplant recipients monitored for dd-cfDNA over a three-year period was analyzed to assess the association of dd-cfDNA with histologic evidence of allograft rejection.

Elevation of dd-cfDNA (0.5% or more) was significantly correlated with clinical and subclinical allograft rejection.

dd-cfDNA values of 0.5% or more were associated with a nearly three-fold increase in risk of development of de novo donor-specific antibodies (hazard ratio 2.71) and were determined to be elevated a median of 91 days (interquartile range of 30-125 days) ahead of donor specific antibody identification.

Persistently elevated dd-cfDNA (more than one result above the 0.5% threshold) predicted over a 25% decline in the estimated glomerular filtration rate over three years (hazard ratio 1.97).

Therefore, routine monitoring of dd-cfDNA allowed early identification of clinically important graft injury.

Biomarker monitoring complemented histology and traditional laboratory surveillance strategies as a prognostic marker and risk-stratification tool post-transplant.

Thus, persistently low dd-cfDNA levels may accurately identify allograft quiescence or absence of injury, paving the way for personalization of immunosuppression trials.

dd-cfDNA for Heart Transplants

We believe that the AlloSure Kidney dd-cfDNA-based solution could provide additional value to AlloMap Heart testing for clinicians caring for heart transplant patients, particularly in situations where a recipient’s AlloMap Heart score suggests a probability of acute rejection.

Studies have reported that a higher percentage of dd-cfDNA in the blood stream of patients is found with moderate or severe heart rejection compared to patients without rejection.

We believe a dd-cfDNA solution such as AlloSure Kidney for the heart could help clinicians identify recipients with a higher probability of rejection and help determine which patients warrant a subsequent biopsy, because the likelihood of detecting rejection in the biopsy specimen would be enhanced.

We believe that the AlloSure Kidney dd-cfDNA-based solution could provide additional value to AlloMap.

Studies have reported that a higher percentage of dd-cfDNA in the bloodstream of patients is found with moderate or severe heart rejection compared to patients without rejection.

A dd-cfDNA solution such as AlloSure for the heart could help clinicians identify recipients with a higher probability of rejection and help determine which patients warrant a subsequent biopsy, because the likelihood of detecting rejection in the biopsy specimen would be enhanced.

Accordingly, we offer HeartCare.

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An approach to surveillance using HeartCare provides information from the two complementary measures:

(i) AlloMap Heart – a measure of immune activation, and (ii) AlloSure Heart – measures graft injury.

(i) AlloMap Heart – a measure of immune activation, and (ii) AlloSure

Heart – measures graft injury.

HeartCare provides complementary information about distinct biological processes, such as immune quiescence, active injury, ACR and AMR in heart transplant recipients.

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Product Advancement and Development

Our ongoing research and development for products is divided between kitted products for pre-transplant and post-transplant.

Our ongoing research and development for our lab products business is focused on kitted products for pre-transplant and post-transplant patient testing.

In the last decade of next generation, the ubiquity of sequencing has unveiled significant additional sequence diversity in the HLA region on chromosome 6 of the human genome.

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Finally, our research and development staff are collaborating to advance the synergies of products across the pre- and post-transplant continuum.

Digital Solutions Business Development

Patient and Digital Solutions Business Development

We acquired Ottr, Inc.

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These acquisitions have strengthened our growing portfolio of transplant software solutions such as Ottr and XynQAPI.

We are committed to continue upgrading these software programs and further integrating them into our current testing service offerings.

We plan to develop, deploy and promote a rational set of analytical tools that provide clinical utility with respect to patient health.

Our vision is to add smart analytics and machine learning to artificial intelligence in transplant, which we call AiTraC.

In 2021, we acquired TransChart, MedActionPlan and TTP.

We are committed to continue upgrading these software programs, including medication adherence management, and further integrating them into our current testing service offerings to provide a unified user experience.

We plan to develop, deploy and promote a rational set of software tools and data-driven services that provide clinical utility with respect to medication adherence and overall patient health.

Our vision is to add smart analytics and machine learning to artificial intelligence in transplant.

Going forward, we will strive to bring our multi-modality testing solutions and machine learning algorithms to the transplant clinic under our AiTraC umbrella.

AiTraC will utilize the large clinical data that are collected through our registry studies to provide caregivers with point of care decision-making support tools that allow them to stratify the patient population.

We are actively working on partnerships in order to help our in house software resources continue to execute on a vision of including smart analytics in the user experience.

We are actively working on partnerships and patient-focused service offerings.

Reimbursement

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The Medicare reimbursement rate for AlloSure Kidney is currently $2,841.

AlloSure Kidney has received positive coverage decisions from BCBS of South Carolina, BCB S of Kansas City and Capital Health, and is reimbursed by other private payers including Kaiser on a contract or case-by-case basis.

AlloSure Kidney has received positive coverage decisions from several commercial payers, and is reimbursed by other private payers on a case-by-case basis.

Following the assignment of a Category 1 Current Procedural Terminology, or CPT code, for AlloMap Heart in September 2015, CMS issued a proposed Clinical Laboratory Fee Schedule, or CLFS, Preliminary Determinations for calendar year 2016.

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Further, the CARES Act delays the reporting cycle under PAMA to January 1 and March 31, 2025, and the preceding data collection period will become January 1 through June 30, 2024.

In December 2021, Congress passed the Protecting Medicare and Medicare Farmers from Sequester Cuts Act.

AlloMap Heart has been a covered service for Medicare beneficiaries since January 2006.

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Al loMap Heart has also received positive coverage decisions for reimbursement from many of the largest U.S.

private payers, including Aetna, Cigna, HCSC, Humana, Kaiser and UnitedHealthcare.

private payers.

In October 2020, AlloSure Heart received a final Palmetto MolDx Medicare coverage decision for AlloSure Heart.

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The Medicare reimbursement rate for AlloSure Heart is currently $2,753.

AlloSure Heart has received positive coverage decisions from several commercial payers.

Private Payers and Medicaid Payers

Due to End Stage Renal Disease, or ESRD, regulations by Medicare, most ESRD patients are covered by Medicare and Medicare Advantage plans and have access to AlloSure Kidney.

Private payers that have adopted a positive coverage policy for AlloSure Kidney include BCBS of South Carolina, BCBS of Kansas City, Kaiser and Capital Blue.

Private payers that have adopted a positive coverage policy include BCBS payers as well as other national payers.

However, other private payers and Medicaid payers have not yet adopted positive coverage policies for AlloSure Kidney.

We are reimbursed for a substantial portion of the AlloMap Heart tests we perform on patients covered by private payers.

Coverage policies approving AlloMap Heart have approached nearly 90% of all covered lives and are published by many of the largest private payers, including Aetna, Anthem, Cigna, HCSC, Humana, Kaiser, and UnitedHealthcare.

Coverage policies approving AlloMap Heart have approached nearly 90% of all covered lives and are published by many of the largest private payers, including several BCBS plans and UnitedHealthcare.

Many other payers have positive coverage policies for AlloMap Heart.

AlloSure Heart is covered by Geisinger Health Plan and Kaiser.

AlloSure Kidney is covered by BCBS of South Carolina, BCBS of Kansas City and Kaiser.

AlloSure Heart and AlloSure Kidney are covered by several commercial payers.

For all tests performed outside the scope of the payer’s policy, and for tests performed where the payer has not adopted a coverage policy, we pursue reimbursement on a case-by-case basis.

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International

Our products have a broad international presence.

Our lab products have a broad international presence.

We sell directly to customers in many regions and also sell through third-party distributors and sub-distributors throughout Europe and the rest of the world.

Testing and Laboratory Operations

AlloSure Kidney, AlloMap Heart and AlloSure Heart testing is performed in our clinical laboratory, which is located in our Brisbane, California location.

AlloSure Kidney, AlloSure Lung, AlloMap Heart and AlloSure Heart testing is performed in our clinical laboratory, which is located in our Brisbane, California location.

Our laboratory holds a certificate of accreditation under the Clinical Laboratory Improvement Amendments of 1988, or CLIA, and is accredited by the College of American Pathologists, or CAP.

We believe that our laboratory capacity will be adequate to meet demand for AlloSure Kidney, AlloMap Heart, AlloSure Heart and other tests in the development pipeline for the next few years.

that our laboratory capacity will be adequate to meet demand for AlloSure Kidney, AlloSure Lung, AlloMap Heart, AlloSure Heart and other tests in the development pipeline for the next few years.

When a clinician orders AlloMap Heart, a blood sample is drawn and processed to isolate the white blood cells, which are subsequently broken down, frozen and sent via overnight courier to our laboratory.

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Results are reported to the ordering clinician by fax or electronically via WebPortal within two business days of receipt of the sample.

We rely solely on certain suppliers to provide some of the laboratory instruments and key reagents that we use to perform AlloSure Kidney, AlloMap Heart, and AlloSure Heart testing.

These sole source suppliers include Thermo Fisher Scientific, which supplies us with instruments, laboratory reagents, a master mix formula and consumables;

We rely solely on certain suppliers to provide some of the laboratory instruments and key reagents that we use to perform AlloSure Kidney, AlloSure Lung, AlloMap Heart, and AlloSure Heart testing.

These sole source suppliers include Thermo Fisher Scientific, Inc., or Thermo Fisher, which supplies us with instruments, laboratory reagents, a master mix formula and consumables;

Roche Molecular Systems, which supplies us with laboratory reagents and consumables;

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For reasons of quality assurance, sole source availability or cost effectiveness, certain components and critical raw materials used in the manufacture of our products are available only from one supplier.

We have worked closely with our suppliers to develop alternate backup plans to assure continuity of supply while maintaining high quality and reliability, and in some cases, we have established long-term supply contracts with our suppliers.

We have worked closely with our suppliers to develop alternate backup plans to ensure continuity of supply while maintaining high quality and reliability, and in some cases, we have established long-term supply contracts with our suppliers.

Due to the high standards and FDA requirements applicable to the manufacturing of our products, we may not be able to quickly establish additional or replacement sources for certain components or materials.

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Olerup SSP, XM-One, and QTYPE.

The facility has a certified Quality Management System, or QMS, to standards ISO 9001:2008 and ISO 13485:

These standards include a special set of requirements specifically related to the supply of medical devices and related services.

The facility has a certified Quality Management System, or QMS, to the ISO 13485:

2016 standard.

This standard includes a special set of requirements specifically related to the supply of medical devices and related services.

ISO is an internationally recognized standard for QMS.

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Additionally, we seek to manufacture to current Good Manufacturing Practice requirements and our QMS is implemented in accordance with FDA Quality System Regulations.

Our manufacturing facility in Fremantle, Australia, is used to support the production, packaging and labeling of our proprietary Olerup SBT and AlloSeq brand kits.

Our manufacturing facility in Fremantle, Australia, is used to support the production, packaging and labeling of our proprietary AlloSeq brand kits.

The facility maintains a valid EC certificate for compliance to Directive 98/79/EC Annex IV, excluding Sections 4 and 6, Full Quality Assurance System In Vitro Diagnostic Medical Devices, and is certified to standards ISO 13485:

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We have a direct field team in the United States that interacts with all aspects of the testing services channel, including sales, marketing, medical science liaison, managed care, and patient care management representatives.

Our marketing strategy focuses on the clinical benefits of AlloSure Kidney and AlloMap Heart, and the scientific validation that supports our tests.

Our marketing strategy focuses on the clinical benefits of AlloSure Kidney, AlloSure Lung, AlloSure Heart and AlloMap Heart, and the scientific validation that supports our tests.

Our strategy includes education to clinicians and the care team at transplant centers, assistance with scheduling ordered tests for patients, and working with centers to adopt formal protocols.

Product Sales and Marketing Team

The product business has sales offices in Vienna, Austria;

Stockholm, Sweden;

The product business has sales offices in Stockholm, Sweden;

West Chester Pennsylvania, United States;

and Fremantle, Australia, which manage direct sales to customers and sales through third-party distributors.

Digital Solutions Sales and Marketing Team

Patient and Digital Solutions Sales and Marketing Team

Our sales teams are located in the United States.

They manage customer sales for Ottr software and XynQAPI software.

They manage customer sales for Ottr software, XynQAPI, Tx Access and MedActionPlan software.

Our strategy includes educating clinicians and care teams at transplant centers through software demos.

Our marketing team supporting the product marketing for Ottr, XynQAPI, AlloCare and other digital offerings is based in South San Francisco.

With our comprehensive portfolio of surveillance testing services, diagnostic products and digital business offerings, we face many different types of competition.

Our pharmacy sales support team is located in Flowood, Mississippi.

With our comprehensive portfolio of surveillance testing services, diagnostic products and patient and digital solutions business offerings, we face many different types of competition.

Testing Services

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In the field of post-transplant surveillance, Natera Inc., or Natera, and Eurofins Viracor, Inc., or Eurofins, have commercially available molecular diagnostics tests .

We expect the competition for post-transplant surveillance to increase as there are several established and early-stage companies in the process of developing products and services for the transplant market that may directly or indirectly compete with AlloSure Kidney, AlloMap Heart or our development pipeline.

In addition, companies that have not historically focused on transplantation, but have knowledge of dd-cfDNA technology, have indicated they are considering this market.

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The market leader in HLA typing and third party distributors is Thermo Fisher through its acquisition of transplant-focused companies One Lambda and Linkage Biosciences.

In certain HLA tissue typing markets that incorporate a wide variety of technology test platforms, such as SSP, SBT, SSO and NGS, competitors include Thermo Fisher, Omixon, GenDx, BAG, Qiagen, and Immucor.

In certain HLA tissue typing markets that incorporate a wide variety of technology test platforms, such as SSP, SSO and NGS, competitors include Thermo Fisher, Omixon, GenDx, BAG, Qiagen, and Immucor.

We also face competition from hospital and commercial reference labs that develop their own in-house testing solutions known in the diagnostics industry as “home brews”.

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In addition, companies that have not historically focused on transplantation, but have knowledge of dd-cfDNA technology, have indicated they are considering the transplantation market.

Digital Solutions

Patient and Digital Solutions

Our competition for patient solutions includes hospital-affiliated pharmacies located on-site at the transplant center and specialty pharmacies that provide transplant-specific care and dispensing services.

Competition for our digital solutions include various companies that develop application software and operate in the healthcare field.

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patents related to transplant rejection and autoimmunity.

We have five issued U.S.

We have four issued U.S.

patents covering methods of diagnosing transplant rejection that use all 11 informative genes measured in AlloMap Heart.

The expiration dates of these patents range from 2022 to 2024.

We have six additional patents covering additional genes or gene variants for diagnosing transplant rejection.

We have five additional patents covering additional genes or gene variants for diagnosing transplant rejection.

In connection with our June 2014 acquisition of ImmuMetrix, Inc., we obtained an exclusive license from the Board of Trustees of the Leland Stanford Junior University, or Stanford, to a patent relating to the diagnosis of rejection in organ transplant recipients using dd-cfDNA.

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A second patent included in the license from Stanford was issued in December 2017 and further covers the use of dd-cfDNA to diagnose and predict transplant status or outcome.

A third and fourth patent were issued from this Stanford set in June 2019 and December 2019, respectively, covering the use of dd-cfDNA to diagnose and predict transplant status or outcome.

Both patents have the same 2030 expiration date as the original Stanford patent.

Five additional patents were issued from this Stanford set between 2019 and 2021, covering the use of dd-cfDNA to diagnose and predict transplant status or outcome.

All of these patents have the same 2030 expiration date as the original Stanford patent.

We have developed trade secrets and know-how since our inception.

These trade secrets and know-how are found particularly in technical areas such as optimized systems for making precise and reproducible q-PCR, measurements, and in the analysis of genomic data and algorithm development.

AlloMap, AlloSure, Olerup SSP, Olerup XM-ONE, QTYPE, Ottr and CareDx are registered trademarks of ours in the United States.

AlloMap, AlloSure, AlloCell, AlloHeme, QTYPE, Ottr and CareDx are registered trademarks of ours in the United States.

License Agreements

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Two issued patents for HLA genotyping are exclusively licensed as part of this agreement.

On April 30, 2019, we entered into a license and collaboration agreement with Cibiltech SAS, or Cibiltech, pursuant to which we were granted an irrevocable, non-transferable right to commercialize Cibiltech’s proprietary software, KidneyCare iBox, for the predictive analysis of post-transplantation kidney allograft loss in the field of transplantation in the U.S.

On April 30, 2019, we entered into a license and collaboration agreement with Cibiltech SAS, or Cibiltech, pursuant to which we were granted an irrevocable, non-transferable right to commercialize Cibiltech’s proprietary software, iBox, for the predictive analysis of post-transplantation kidney allograft loss in the field of transplantation in the U.S.

for a period of ten years.

In April 2020, we entered into a license agreement with Cornell University pursuant to which we were granted exclusive rights to three patents and two patent applications covering methods and technology for measurement of gene expression in urine to diagnose kidney transplant rejection.

In June 2021, we entered into a strategic agreement with OrganX to develop clinical decision support tools across the transplant patient journey.

Together, we and OrganX will develop advanced analytics that integrate AlloSure, the first transplant specific dd-cfDNA assay, with large transplant databases to provide clinical data solutions.

This partnership delivers the next level of innovation beyond multi-modality by incorporating a variety of clinical inputs to create a universal composite scoring system.

Our business is subject to and impacted by frequently changing laws and regulations in the United States and internationally.

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These regulations apply to all of our products sold in the United States, as well as our facilities in Stockholm, Sweden used to produce some of our products.

The FDA has also asserted that it has the authority to regulate laboratory developed tests, or LDTs, as medical devices under the FFDCA.

The FDA has also asserted that it has the authority to regulate laboratory developed tests, or LDTs, as medical devices under the

An LDT is a test developed by a single laboratory for use only in that laboratory, such as AlloMap Heart or AlloSure Kidney.

The FDA has traditionally chosen not to exercise its authority to regulate LDTs because it regulates the primary components in most laboratory-developed tests and because it believes that laboratories certified as high complexity under the CLIA, such as ours, have demonstrated expertise and ability in test procedures and analysis.

The FDA has traditionally chosen not to exercise its authority to regulate LDTs because it regulates the primary components in most laboratory-developed tests and because laboratories, such as ours, certified as high complexity under the CLIA are regulated and reviewed by CMS to ensure that lab expertise and test procedures and correct analyses are followed.

In the event the FDA changes their policy in regards to “Enforcement discretion” for LDTs, it could require us to modify our business model and incur higher costs in order to maintain compliance with this new policy.

A similar situation may occur if Congress decides to enable newly proposed regulations, such as the Verifying Accurate Leading-edge IVCT Development Act of 2018.

For AlloSure Kidney and other similar testing solutions, we may be required to conduct additional clinical trials to demonstrate clinical validity and utility of our test, and submit to the FDA a premarket approval application, or PMA, or 510(k) premarket notification application and obtain approval or clearance for the test subsequent to commercialization.

A similar situation may occur if Congress decides to enable newly proposed regulations, such as the updated Verifying Accurate Leading-edge IVCT Development Act of 2021.

For AlloSure Kidney and other similar testing solutions, if required by the FDA or if new laws are enacted we may be required to conduct additional clinical trials to demonstrate clinical validity and utility of our test, and submit to the FDA a premarket approval application, or PMA, or 510(k) premarket notification application and obtain approval or clearance for the test subsequent to commercialization.

There can be no assurance that any of our tests or additional uses of our tests for which we seek clearance or approval in the future will be cleared or approved on a timely basis, or at all, and there can be no assurance that labeling claims will be consistent with our current claims or adequate to support continued adoption of and reimbursement for our current and future tests.

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Department of Health and Human Services, or HHS, has issued regulations to protect the privacy and security of protected health information and standardize data content, codes and formats used in healthcare transactions and the standardized identifiers used by healthcare providers, such as us, and health plans.

We have developed policies and procedures to comply with these regulations.

The requirements under these regulations may change periodically and could have an effect on our business operations if compliance becomes substantially more costly than under current requirements or a significant breach to protected health information, or PHI, may occur.

We have developed policies and procedures in view of these regulations.

The requirements under these regulations may change periodically and could have an effect on our business operations if compliance becomes substantially more costly than under current requirements, business practices change or a significant breach to protected health information, or PHI, occurs.

In addition to federal privacy regulations, there are a number of state laws governing confidentiality of health information that are applicable to our operations.

New laws governing privacy may be adopted in the future as well.

We have taken steps to comply with health information privacy requirements to which we are aware that we are subject.

We have taken steps intended to address health information privacy requirements to which we are aware that we are subject.

Whether regulators may find our policies, procedures and other privacy initiatives to be compliant with HIPAA is subject to the regulator's assessment.

Federal and State Self-Referral Prohibitions

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We have compensation arrangements with a number of physicians for personal services, such as speaking engagements and clinical advisory boards.

We have structured these arrangements with terms intended to comply with the requirements of the applicable exceptions to the Stark Law, PORA and other similar state laws.

We have structured these arrangements with terms intended to address the requirements of the applicable exceptions to the Stark Law, PORA and other similar state laws.

However, we cannot be certain that regulators would find these arrangements to be in compliance with the Stark Law, PORA or similar state laws.

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There have previously been public announcements by members of the U.S.

Congress regarding their plans to repeal and replace the Affordable Care Act, and the Biden administration has announced plans to expand the Affordable Care Act.

We cannot predict whether future healthcare initiatives, including at the federal level, will be initiated or the effect such initiatives could have on our business.

Congress regarding their plans to repeal and replace the Affordable Care Act, and the Biden administration has announced plans to expand the federal health care programs, such as Medicare and Medicaid.

We cannot predict whether future healthcare initiatives, including at the federal level, will be initiated or the effect any such initiatives could have on our business, financial condition or results of operations.

The Eliminating Kickbacks in Recovery Act of 2018

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Department of Health and Human Services has created several regulatory "safe harbors." Arrangements that meet all of the conditions of an applicable exception or safe harbor are protected from liability under the Anti-Kickback Statute.

However, the failure to fit an arrangement within an exception or a safe harbor does not necessarily mean that the statute has been violated or that the arrangement will be prosecuted.

However, the failure to fit an arrangement within an exception or a safe harbor does not necessarily

mean that the statute has been violated or that the arrangement will be prosecuted.

Penalties for violations include criminal penalties and civil sanctions such as fines, imprisonment and possible exclusion from Medicare, Medicaid and other federal health care programs.

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In addition, various states have enacted false claims laws analogous to the federal False Claims Act, and many of these state laws apply where a claim is submitted to any third-party payer and not merely the federal government.

When an entity is determined to have violated the False Claims Act, it may be required to pay up to three times the actual damages sustained by the government, plus civil penalties of between $11,665 and $23,331 for each false claim for penalties assessed after June 19, 2020.

When an entity is determined to have violated the False Claims Act, it may be required to pay up to three times the actual damages sustained by the government, plus civil penalties of between $11,803 and $23,607 for each false claim for penalties assessed after December 31, 2021.

There are many potential bases for liability under the False Claims Act.

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For requests to opt-out, businesses must provide a “Do Not Sell My Info” link on their website or mobile app.

Under the CCPA, we are required to:

Under the CCPA, applicable businesses are required to:

• respond to requests from consumers to know, delete and opt-out within specific time frames;

• verify the identity of consumers who make requests to know and to delete, whether or not the consumer maintains a password-protected account with us;

• maintain records of requests and how we responded for 24 months in order to demonstrate our compliance;

• verify the identity of consumers who make requests to know and to delete, whether or not the consumer maintains a password-protected account;

• maintain records of requests and response for 24 months in order to demonstrate our compliance;

• treat user-enabled privacy settings that signal a consumer’s choice to opt-out as a validly submitted opt-out request;

• disclose financial incentives offered in exchange for the retention or sale of a consumer’s personal information and explain how we calculate the value of the personal information;

• disclose financial incentives offered in exchange for the retention or sale of a consumer’s personal information and explain how the value of the personal information is calculated;

• explain how these incentives are permitted under the CCPA.

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A manufacturer placing devices on the market in its name must notify its national competent authorities.

Our products also comply with the CMDCAS, which is a system designed to implement Canadian regulations requiring some medical devices be designed and manufactured under a registered QMS.

These CE labeled products are also falling under requirements of the In-Vitro Diagnostic Regulation (2017/746) (IVDR).

The IVDR requirements are applied starting May 26, 2022.

The European Commission recently confirmed adoption of a proposal for a progressive roll-out of the IVDR to prevent disruption in the supply of In-Vitro Diagnostic products to the market.

The proposal does not change any requirements of the IVDR or changes the implementation date but changes the transitional provisions to allow a progressive rollout based on the risk level of the device.

In accordance with these timelines, our current CE marked products will remain available to customers throughout the transition period.

There is currently no anticipated supply risk based on the implementation of the IVDR in May 2022.

The date of certification for our products under the IVDR is currently under review in consultation with our notified body and certification of these products to the IVDR shall be achieved within the transition timeframes.

We are also actively working with our Notified Body to bring the Quality management system at the sites to be compliant to IVDR requirements by May 2026.

Certain of our products also comply with the CMDCAS, which is a system designed to implement Canadian regulations requiring some medical devices be designed and manufactured under a registered QMS.

The SCC and Health Canada's Therapeutic Products Directorate developed this system.

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Controllers and processors of personal data must put in place appropriate technical and organizational measures to implement the data protection principles.

Business processes that handle personal data must be designed and built with consideration of the principles and provide safeguards to protect data (for example, using pseudonymization or full anonymization where appropriate).

Business processes that handle personal data must be designed and built with consideration of the GDPR principles and provide safeguards to protect data.

Data controllers and processors must design information systems with privacy in mind.

for instance using the highest-possible privacy settings by default, so that the datasets are not publicly available, and cannot be used to identify a subject.

No personal data may be processed unless it is done under one of six lawful bases specified by the regulation (consent, contract, public interest, vital interest, legitimate interest or legal requirement).

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Data subjects have the right to request a portable copy of the data collected by a data controller or processor in a common format, and, under certain circumstances, the right to have their data erased.

Public authorities, and businesses whose core activities consist of regular or systematic processing of personal data, are required to employ a data protection officer, who is responsible for managing compliance with the GDPR.

Businesses must report data breaches to national supervisory authorities within 72 hours if they have an adverse effect on user privacy.

Businesses must report data breaches to national supervisory authorities within 72 hours after becoming aware of the breach if they have an adverse effect on user privacy.

In some cases, violators of the GDPR may be fined up to €20 million or up to 4% of the annual worldwide turnover of the preceding financial year in case of an enterprise, whichever is greater.

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In areas where COVID-19 impacts healthcare operations, our field-based sales and clinical support teams are supporting providers through telephone and online platforms.

We have also created a COVID-19 task force that is responsible for crisis decision making, employee communications, enforcing pre-arrival temperature checking, daily health check-ins and enhanced safety training/protocols in our offices for employees who do not work from home.

From time to time, we also employ independent contractors, consultants and temporary employees to support our operations.

Currently, the CareDx SSP production group in Sweden is represented by an IF Metall collective bargaining agreement.

Currently, our SSP production group in Sweden is represented by an IF Metall collective bargaining agreement.

None of our other employees are represented by a union or are subject to collective bargaining agreements.

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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-K

Item 1. Business