What changed in this filing

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Item 9A. Controls and Procedures

2025-03-31 compared with 2024-04-01 · 2221 added, 1099 removed, 218 unchanged (94% of the section changed)

6 unchanged sentences

designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange

Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange

Commission’s rules and forms.

Management recognizes that any controls and procedures, no matter how well designed and

operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in

evaluating the cost-benefit relationship of possible controls and procedures.

Disclosure controls and procedures include, without

limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it

files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal

executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.

Based on this

evaluation, management identified a material weakness in the Company’s internal control over financial reporting in the fourth

quarter of 2023 related to properly identifying the timing of when revenue should be recognized as stated in the revenue

recognition policy .

Based on that evaluation, our

principal executive officer and principal financial officer concluded that our disclosure controls and procedures were not effective

as of the end of the period covered by this Annual Report on Form 10-K as a result of the identified material control

Remediation Plan -

The Company plans to amend its control activities designed to mitigate the significant risk identified, including updating its

procedures regarding the testing of revenue recognition, specifically to review the procedures identifying the timing differences to ensure revenue is recorded in the period earned.

The Company believes implementation of these processes and appropriate testing of their effectiveness will remediate this material

control weakness.

Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms.

Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable

assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship

of possible controls and procedures.

Disclosure controls and procedures include, without limitation, controls and procedures

designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange

Act is accumulated and communicated to the company’s management, including its principal executive and principal financial

officers, as appropriate to allow timely decisions regarding required disclosure.

Based on this evaluation, management identified a

material weakness in the Company’s internal control over financial reporting in the fourth quarter of 2024 related to the

Company’s royalty accrual.

It was determined that the Company should not have been accruing royalty expense with respect to

certain royalty agreements and therefore had materially misstated their financial statements in prior periods.

Management notes that

the root cause of the royalty error was a design control failure as there was a lack of process related to communication between the

Company’s science team, such as the Chief Scientific Officer, management of the Company, including the Chief Executive Officer

(“CEO”), and the accounting team, including the Chief Financial Officer (“CFO”).

At the time the initial

accrual was made and as the royalty continued to be accrued since that point, there was a lack of control

whereby the accounting team was not aware that the Company’s revenue sources, ThyraMIR and

ThyGeNEXT, did not utilize the technology covered under the royalty agreements.

Based on that evaluation, our principal executive

officer and principal financial officer concluded that our disclosure controls and procedures were not effective as of the end of

the period covered by this Annual Report on Form 10-K as a result of the identified material control weakness.

Plan - The Company plans to amend its control activities designed to mitigate the material weakness identified, including updating its

procedures regarding the review of significant, complex agreements, to include the retention of outside subject matter experts specifically

to review the agreements and any complexities that may arise.

In addition, the Company plans to establish a quarterly meeting between

members of management, including the CEO and CFO, as well as members from the Company’s science team to ensure that management,

including those responsible for financial reporting, understand the agreements which are disclosed within the financial statements to

ensure proper accounting for these agreements.

The Company believes implementation of these processes and appropriate testing of their

effectiveness will remediate this material control weakness.

Annual Report on Internal Control over Financial Reporting

14 unchanged sentences

in Internal Control over Financial Reporting

has been no change in our internal control over financial reporting during the fourth quarter of the fiscal year ended December 31, 2023.

March 29, 2024, the Company entered into a Third Amendment to Loan and Security Agreement with BroadOak.

The primary changes to the Second

Amendment to Loan and Security Agreement were as follows:

maturity date was extended to June 30, 2025.

April 1, 2024, the Company will make $500,000 monthly payments with the remaining loan balance due on the new maturity date.

the fourth quarter ended December 31, 2024 management believes that it has completed its remediation plan to address the material weakness

that existed at the end of 2023 and through the first three quarters of 2024 related to the timing of revenue recognition.

had adopted a remediation plan and updated its procedures regarding the testing of revenue recognition and review the procedures which

ensure that revenue is recorded in the period in which it is earned.

Other than the completion of this remediation plan there has been no change

in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during

the quarter covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over

financial reporting.

REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

1 unchanged sentence

relating to directors and executive officers of the registrant that is responsive to Item 10 of this Annual Report on Form 10-K will

be included in an amendment hereto or will be included in our Proxy Statement for our 2024 annual meeting of stockholders and such

information is incorporated by reference herein.

relating to executive compensation of the registrant that is responsive to Item 11 of this Annual Report on Form 10-K will be included

in an amendment hereto or will be included in our Proxy Statement for our 2024 annual meeting of stockholders and such information

be included in an amendment hereto or will be included in our Proxy Statement for our 2025 annual meeting of stockholders and such information

is incorporated by reference herein.

relating to executive compensation of the registrant that is responsive to Item 11 of this Annual Report on Form 10-K will be included

in an amendment hereto or will be included in our Proxy Statement for our 2025 annual meeting of stockholders and such information is

incorporated by reference herein.

OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

relating to security ownership of certain beneficial owners and management of the registrant that is responsive to Item 12 of this

Annual Report on Form 10-K will be included in an amendment hereto or will be included in our Proxy Statement for our 2024 annual

meeting of stockholders and such information is incorporated by reference herein.

relating to security ownership of certain beneficial owners and management of the registrant that is responsive to Item 12 of this Annual

Report on Form 10-K will be included in an amendment hereto or will be included in our Proxy Statement for our 2025 annual meeting of

stockholders and such information is incorporated by reference herein.

RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

relating to certain relationships and related transactions of the registrant that is responsive to Item 13 of this Annual Report

on Form 10-K will be included in an amendment hereto or will be included in our Proxy Statement for our 2024 annual meeting of stockholders

and such information is incorporated by reference herein.

relating to certain relationships and related transactions of the registrant that is responsive to Item 13 of this Annual Report on Form

10-K will be included in an amendment hereto or will be included in our Proxy Statement for our 2025 annual meeting of stockholders and

such information is incorporated by reference herein.

ACCOUNTANT FEES AND SERVICES

relating to principal accounting fees and services of the registrant that is responsive to Item 14 of this Annual Report on Form

10-K will be included in an amendment hereto or will be included in our Proxy Statement for our 2024 annual meeting of stockholders

and such information is incorporated by reference herein.

relating to principal accounting fees and services of the registrant that is responsive to Item 14 of this Annual Report on Form 10-K

will be included in an amendment hereto or will be included in our Proxy Statement for our 2025 annual meeting of stockholders and such

information is incorporated by reference herein.

FINANCIAL STATEMENT SCHEDULES

2 unchanged sentences

Statement Schedule

Valuation and Qualifying Accounts

other schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes

2 unchanged sentences

and Flagship Biosciences, Inc., incorporated by reference to Exhibit 2.1 of the Company’s Current Report on Form 8-K filed with the SEC on September 7, 2022.

Conformed version of Certificate of Incorporation of Interpace Biosciences, Inc., as amended by the Certificate of Amendment, effective January 15, 2020, and the Certificate of Designation of Preferences, Rights and Limitations of Series B Convertible Preferred Stock, filed January 17, 2020, incorporated by reference to Exhibit 3.1 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on April 22, 2020, as amended from time to time.

Conformed version of Certificate of Incorporation of Interpace Biosciences, Inc., as amended most recently by the Certificate of Designation of Preferences, Rights and Limitations of Series C Convertible Preferred Stock, effective October 11, 2024, incorporated by reference to Exhibit 3.1 of the Company’s Quarterly Report on Form 10-Q, filed with the SEC on November 8, 2024.

Amended and Restated Bylaws of Interpace Biosciences, Inc., incorporated by reference to Exhibit 3.2 of the Company’s Current Report on Form 8-K, filed with the SEC on November 14, 2019.

38 unchanged sentences

and Saddle Lane Realty, LLC, dated as of October 31, 2022, incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed with the SEC on November 4, 2022.

Securities Purchase Agreement, dated July 15, 2019, by and between Interpace Diagnostics Group, Inc.

and Ampersand 2018 Limited Partnership, incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K, filed with the SEC on July 19, 2019.

Form of Voting Agreement, incorporated by reference to Exhibit 10.4 of the Company’s Current Report on Form 8-K, filed with the SEC on July 19, 2019.

Securities Purchase and Exchange Agreement, dated January 10, 2020, by and among Interpace Biosciences, Inc., 1315 Capital II, L.P.

and Ampersand 2018 Limited Partnership, incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed with the SEC on January 14, 2020.

Amended and Restated Investor Rights Agreement, dated as of January 15, 2020, by and among Interpace Biosciences, Inc., 1315 Capital II, L.P.

and Ampersand 2018 Limited Partnership, incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed with the SEC on January 17, 2020.

Support Agreement, dated April 2, 2020, by and between 1315 Capital II, L.P.

and Interpace Biosciences, Inc., incorporated by reference to Exhibit 10.2 of the Company’s quarterly report on Form 10-Q for the quarter ended June 30, 2020, filed with the SEC on October 19, 2020.

Loan and Security Agreement by and between Comerica Bank, Interpace Biosciences, Inc., Interpace Diagnostics Corporation, Interpace Diagnostics, LLC and Interpace Pharma Solutions, Inc., dated October 13, 2021, incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed with the SEC on October 19, 2021.

Subordination Agreement by and between Ampersand 2018 Limited Partnership, 1315 Capital II.

L.P., Comerica Bank Interpace Biosciences, Inc., Interpace Diagnostics Corporation, Interpace Diagnostics, LLC and Interpace Pharma Solutions, Inc., dated October 13, 2021, incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K, filed with the SEC on October 19, 2021.

Loan and Security Agreement by and between BroadOak Fund V, L.P., Interpace Biosciences, Inc., Interpace Diagnostics Corporation, Interpace Diagnostics, LLC and Interpace Pharma Solutions, Inc., dated October 29, 2021, incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed with the SEC on November 3, 2021.

Second Amendment to Loan and Security Agreement by and between BroadOak Fund V, L.P., Interpace Biosciences, Inc., Interpace Diagnostics Corporation, Interpace Diagnostics, LLC and Interpace Pharma Solutions, Inc., dated October 24, 2023, incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed with the SEC on October 27, 2023.

First Amendment to Loan and Security Agreement by and between Comerica Bank, Interpace Biosciences, Inc., Interpace Diagnostics Corporation, Interpace Diagnostics, LLC and Interpace Pharma Solutions, Inc., dated November 1, 2021, incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K, filed with the SEC on November 3, 2021.

Subordination and Intercreditor Agreement by and between Comerica Bank, BroadOak Fund V, L.P., Interpace Biosciences, Inc., Interpace Diagnostics Corporation, Interpace Diagnostics, LLC and Interpace Pharma Solutions, Inc., dated as of November 1, 2021, incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K, filed with the SEC on November 3, 2021.

Amendment to the Interpace Biosciences, Inc.

2 unchanged sentences

Employee Stock Purchase Plan, incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K, filed with the SEC on November 15, 2022.

Letter from BDO USA, LP dated April 13, 2022, incorporated by reference to Exhibit 16.1 of the Company’s Current Report on Form 8-K, filed with the SEC on April 14, 2022.

Third Amendment to Loan and Security Agreement by and between BroadOak Fund V, L.P., Interpace Biosciences, Inc., Interpace Diagnostics Corporation, Interpace Diagnostics, LLC and Interpace Pharma Solutions, Inc., dated March 29, 2024, incorporated by reference to Exhibit 10.39 of the Company’s Annual Report on Form 10-K, filed with the SEC on April 1, 2024.

Series C Preferred Stock Exchange Agreement, incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed with the SEC on October 15, 2024.

Amended and Restated Investor Rights Agreement, dated as of October 10, 2024, by and among Interpace Biosciences, Inc., 1315 Capital II, L.P.

and Ampersand 2018 Limited Partnership, incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K, filed with the SEC on October 15, 2024.

Termination of Support Agreement, dated October 14, 2024, by and between 1315 Capital II, L.P.

and Interpace Biosciences, Inc., incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K, filed with the SEC on October 15, 2024.

Fourth Amendment to Loan and Security Agreement with BroadOak Fund V, L.P., dated January 17, 2025, incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed with the SEC on January 21, 2025.

Insider Trading Policy

Subsidiaries of the Registrant, incorporated by reference to Exhibit 21.1 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on April 22, 2020, as amended from time to time.

14 unchanged sentences

compensatory plan, compensation arrangement or management contract.

Filed herewith.

Company has opted to not provide a summary.

2 unchanged sentences

BIOSCIENCES, INC.

April 1, 2024

March 31, 2025

and Chief Executive Officer

2 unchanged sentences

Chief Executive Officer and Director

April 1, 2024

Executive Officer)

1 unchanged sentence

Financial Officer

April 1, 2024

Financial and Accounting Officer)

April 1, 2024

Joseph Keegan

April 1, 2024

Vijay Aggarwal

April 1, 2024

Fortunato Ron Rocca

April 1, 2024

Biosciences, Inc.

to Consolidated Financial Statements

Financial Statement Schedules

of Independent Registered Public Accounting Firm (EisnerAmper LLP;

Interpace Biosciences,

Index to Consolidated

Financial Statements

and Financial Statement

Report of Independent Registered Public Accounting Firm (EisnerAmper

Philadelphia, PA;

PCAOB ID # 274 )

Financial Statements

Balance Sheets at December 31, 2023 and 2022

Statements of Operations for the years ended December 31, 2023 and 2022

Statements of Stockholders’ Deficit for the years ended December 31, 2023 and 2022

Statements of Cash Flows for the years ended December 31, 2023 and 2022

to Consolidated Financial Statements

Valuation and Qualifying Accounts

Consolidated Financial Statements

Consolidated Balance Sheets at December 31, 2024 and 2023

Consolidated Statements of Operations for the years ended December 31, 2024 and 2023

Consolidated Statements of Stockholders’ Deficit for the years ended December 31, 2024 and 2023

Consolidated Statements of Cash Flows for the years ended December 31, 2024 and 2023

Notes to Consolidated Financial Statements

of Independent Registered Public Accounting Firm

the Board of Directors and Stockholders of

Biosciences, Inc.

on the Financial Statements

have audited the accompanying consolidated balance sheets of Interpace Biosciences, Inc.

and Subsidiaries (the “Company”)

as of December 31, 2023 and 2022, and the related consolidated statements of operations, stockholders’ deficit, and cash flows

for each of the years then ended, and the related notes and the financial statement schedule identified in Item 15 (collectively referred

to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the

consolidated financial position of the Company as of December 31, 2023 and 2022, and the consolidated results of their operations and

their cash flows for each of the years then ended, in conformity with accounting principles generally accepted in the United States of

financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s

financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board

(United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S.

securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain

reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits,

we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion

on the effectiveness of the Company’s internal control over financial reporting.

To the Board of Directors and Stockholders of

Interpace Biosciences, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance

sheets of Interpace Biosciences, Inc.

and Subsidiaries (the “Company”) as of December 31, 2024 and 2023, and the related consolidated

statements of operations, stockholders’ deficit, and cash flows for each of the years then ended, and the related notes (collectively

referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects,

the consolidated financial position of the Company as of December 31, 2024 and 2023, and the consolidated results of their operations

and their cash flows for each of the years then ended, in conformity with accounting principles generally accepted in the United States

As discussed in Note 2 to the financial statements,

the 2023 financial statements have been restated to correct a misstatement.

Basis for Opinion

These financial statements are the responsibility

of the Company’s management.

Our responsibility is to express an opinion on the Company’s financial statements based on our

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”)

and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable

rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards

of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements

are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform,

an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an understanding of internal

control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal

control over financial reporting.

Accordingly, we express no such opinion.

audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error

or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding

the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant

estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits

provide a reasonable basis for our opinion.

critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated

or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the financial

statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of the critical audit matter

does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit

matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Consideration in Revenue

described in Note 1 to the consolidated financial statements, the Company’s clinical services derive revenue from the performance

of its proprietary assays or tests.

The Company’s performance obligation is fulfilled upon the completion, review and release of

test results to the customer.

The Company subsequently bills third-party payers or direct-bill payers for the tests performed.

is recognized based on the estimated transaction price or net realizable value, which is determined based on historical collection rates

by each payer category for each proprietary test offered by the Company.

To the extent the transaction price includes variable consideration,

the Company estimates the amount of variable consideration that should be included in the transaction price using the expected value

method based on historical experience.

identified the estimation of the variable consideration as a critical audit matter due to the significant judgement and estimation required

by management in their assessment.

This led to a high degree of auditor subjectivity and significant audit effort was required in performing

our procedures and evaluating audit evidence relating to estimates and assumptions made by management.

the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated

financial statements.

Our procedures included, among other things, (i) obtaining an understanding of management’s process and evaluating

the design of controls related to revenue recognition;

(ii) assessing the reasonableness of management’s estimates of variable

consideration utilizing the expected value method based on its historical experience;

(iii) comparing the Company’s estimates of

variable consideration to the history of cash ultimately received from its payors;

and (iv) testing the historical accuracy of cash collections

used in the Company’s assumptions relating to variable consideration.

Our audits included performing procedures to assess

the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond

to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating

the overall presentation of the financial statements.

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a

matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit

committee and that:

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially

challenging, subjective, or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on

the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion

on the critical audit matter or on the accounts or disclosures to which it relates.

Variable Consideration in Revenue

As described in Note 1 to the consolidated financial

statements, the Company’s clinical services derive revenue from the performance of its proprietary assays or tests.

The Company’s

performance obligation is fulfilled upon the completion, review and release of test results to the customer.

The Company subsequently

bills third-party payers or direct-bill payers for the tests performed.

Revenue is recognized based on the estimated transaction price

or net realizable value, which is determined based on historical collection rates by each payer category for each proprietary test offered

by the Company.

To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration

that should be included in the transaction price using the expected value method based on historical experience.

We identified the estimation of the variable consideration

as a critical audit matter due to the significant judgement and estimation required by management in their assessment.

This led to a high

degree of auditor subjectivity and significant audit effort was required in performing our procedures and evaluating audit evidence relating

to estimates and assumptions made by management.

Addressing the matter involved performing procedures and evaluating audit

evidence in connection with forming our overall opinion on the consolidated financial statements.

Our procedures included, among other

things, (i) obtaining an understanding of management’s process and evaluating the design of controls related to revenue recognition;

(ii) assessing the reasonableness of management’s estimates of variable consideration utilizing the expected value method based

on its historical experience;

(iii) comparing the Company’s estimates of variable consideration to the history of cash ultimately

received from its payors;

and (iv) testing the historical accuracy of cash collections used in the Company’s assumptions relating

to variable consideration.

/s/ EisnerAmper LLP

We have served as the Company’s auditor since

EISNERAMPER LLP

have served as the Company’s auditor since 2022.

Philadelphia,

April 1, 2024

BIOSCIENCES, INC.

BALANCE SHEETS

thousands, except share and per share data)

and cash equivalents

current assets

Philadelphia, Pennsylvania

March 31, 2025

INTERPACE BIOSCIENCES, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)

(as restated)

Current assets:

and equipment, net

intangible assets, net

lease right of use assets

long-term assets

AND STOCKHOLDERS’ DEFICIT

salary and bonus

accrued expenses

payable at fair value, current

of credit - current

liabilities of discontinued operations

Cash and cash equivalents

Accounts receivable

Other current assets

Total current assets

Property and equipment, net

Operating lease right of use assets

Other long-term assets

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities:

consideration

lease liabilities, net of current portion

payable at fair value

long-term liabilities

and contingencies (Note 11)

preferred stock, $ .01 par value;

5,000,000 shares authorized, 47,000 shares Series B issued and outstanding

Stockholders’

stock, $ .01 par value;

Accounts payable

Accrued salary and bonus

Other accrued expenses

Note payable at fair value, current

Current liabilities of discontinued operations

Total current liabilities

Operating lease liabilities, net of current portion

Note payable at fair value

Other long-term liabilities

Total liabilities

Commitments and contingencies (Note 11)

Redeemable preferred stock, $ .01 par value;

5,000,000 shares authorized, 0 and 47,000 shares Series B

issued and outstanding, respectively

Stockholders’ deficit:

Redeemable preferred stock, $ .01 par value;

5,000,000 shares authorized, 47,000 and 0 shares Series C issued and outstanding, respectively

Common stock, $ .01 par value;

100,000,000 shares authorized;

4,539,663 and 4,447,489 shares issued, respectively;

4,409,323 and 4,351,445 shares outstanding, respectively

Common stock, $.01 par value;

100,000,000 shares authorized;

4,539,663 and 4,447,489 shares issued, respectively;

4,409,323 and 4,351,445

shares outstanding, respectively

paid-in capital

stock, at cost ( 96,044 and 71,120 shares, respectively)

stockholders’ deficit

liabilities and stockholders’ deficit

liabilities, preferred stock and stockholders’ deficit

accompanying notes are an integral part of these consolidated financial statements

BIOSCIENCES, INC.

STATEMENTS OF OPERATIONS

thousands, except for per share data)

and marketing

and development

and administrative

related amortization expense

in fair value of contingent consideration

Additional paid-in capital

Accumulated deficit

Treasury stock, at cost ( 130,340 and 96,044 shares, respectively)

Total stockholders’ deficit

Total liabilities and stockholders’ deficit

Total liabilities, preferred stock and stockholders’ deficit

The accompanying notes are an integral part of

these consolidated financial statements

INTERPACE BIOSCIENCES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except for per share data)

For The Years

Ended December 31,

(as restated)

Cost of revenue

Operating expenses:

income (loss) from continuing operations

accretion expense

payable interest expense

(loss) from continuing operations before tax

for income taxes

(loss) from continuing operations

from discontinued operations, net of tax

income (loss)

net income (loss) per share of common stock:

continuing operations

discontinued operations

income (loss) per basic share of common stock

net income (loss) per share of common stock:

continuing operations

discontinued operations

income (loss) per diluted share of common stock

average number of common shares and common share equivalents outstanding:

accompanying notes are an integral part of these consolidated financial statements

BIOSCIENCES, INC.

STATEMENTS OF STOCKHOLDERS’ DEFICIT

-December 31, 2021

Sales and marketing

Research and development

General and administrative

Acquisition related amortization expense

Change in fair value of contingent consideration

Total operating expenses

Operating income from continuing operations

Interest accretion expense

Note payable interest expense

Other expense, net

Income from continuing operations before tax

Provision for income taxes

Income from continuing operations

Loss from discontinued operations, net of tax

Less adjustment for preferred stock deemed dividend

Net income attributable to common stockholders

Basic net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per basic share of common stock

Diluted net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per diluted share of common stock

Weighted average number of common shares and common share equivalents outstanding:

The accompanying notes are an integral part of

these consolidated financial statements

INTERPACE BIOSCIENCES, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’

(in thousands)

Preferred Stock

Treasury Stock

Balance -December 31, 2022 as restated

$ ( 244,036 )

of common stock

stock purchased

compensation expense

-December 31, 2022

Issuance of common stock

Treasury stock purchased

Stock-based compensation expense

Balance -December 31, 2023 as restated

$ ( 242,082 )

of common stock

stock purchased

compensation expense

income (loss)

-December 31, 2023

Issuance of common stock

Issuance of Series C preferred stock, net of issuance costs

Treasury stock purchased

Stock-based compensation expense

Balance -December 31, 2024

$ ( 235,380 )

accompanying notes are an integral part of these consolidated financial statements

BIOSCIENCES, INC.

STATEMENTS OF CASH FLOWS

The Years Ended December 31,

Flows From Operating Activities

income (loss)

to reconcile net income (loss) to net cash provided by (used in) operating activities:

and amortization

accretion expense

asset impairment

of deferred financing fees

The accompanying notes are an integral part of

these consolidated financial statements

INTERPACE BIOSCIENCES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

For The Years Ended December 31,

(as restated)

Cash Flows From Operating Activities

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

Interest accretion expense

Amortization of deferred financing fees

Stock-based compensation

Amortization on operating lease right of use asset

in fair value of note payable

in fair value of contingent consideration

gains and expenses, net

changes in operating assets and liabilities:

current assets

long-term assets

salaries and bonus

lease liabilities

cash provided by (used in) operating activities

Flows From Investing Activity

from sale of Interpace Pharma Solutions, net

of property and equipment

cash (used in) provided by investing activities

Flows From Financing Activities

of common stock, net of expenses

of BroadOak terminal payment

from convertible debt issuance

Change in fair value of note payable

Change in fair value of contingent consideration

Other changes in operating assets and liabilities:

Accounts receivable

Other current assets

Accounts payable

Accrued salaries and bonus

Accrued liabilities

Operating lease liabilities

Long-term liabilities

Net cash provided by operating activities

Cash Flows From Investing Activity

Proceeds from sale of Interpace Pharma Solutions, net

Purchase of property and equipment

Net cash used in investing activities

Cash Flows From Financing Activities

Payments made on note payable

Series C Preferred stock issuance costs

Payment of BroadOak terminal payment

Payments on line of credit

Borrowings on line of credit

paid for repurchase of restricted shares

cash (used in) provided by financing activities

(decrease) increase in cash and cash equivalents

and cash equivalents from continuing operations – beginning

and cash equivalents from discontinued operations – beginning

and cash equivalents – beginning

and cash equivalents from continuing operations – ending

and cash equivalents from discontinued operations – ending

and cash equivalents – ending

accompanying notes are an integral part of these consolidated financial statements

Nature of Business and Significant Accounting Policies

Biosciences, Inc.

(“Interpace” or the “Company”) is a company that provides molecular diagnostics, bioinformatics

and pathology services for evaluation of risk of cancer by leveraging the latest technology in personalized medicine for improved patient

diagnosis and management.

The Company develops and commercializes genomic tests and related first line assays principally focused on

early detection of patients with indeterminate biopsies and at high risk of cancer using the latest technology.

of Consolidation

accompanying consolidated financial statements have been prepared in accordance with U.S.

Cash paid for repurchase of restricted shares

Net cash used in financing activities

Net decrease in cash and cash equivalents

Cash and cash equivalents from continuing operations – beginning

Cash and cash equivalents from discontinued operations – beginning

Cash and cash equivalents – beginning

Cash and cash equivalents from continuing operations – ending

Cash and cash equivalents from discontinued operations – ending

Cash and cash equivalents – ending

The accompanying notes are an integral part of

these consolidated financial statements

Nature of Business and Significant Accounting

Nature of Business

Interpace Biosciences, Inc.

or the “Company”) is a company that provides esoteric molecular diagnostic testing, and pathology services to aid physicians

in their evaluation of cancer risk in patients with indeterminate biopsies and a perceived high risk of cancer from clinical features.

We develop and commercialize genomic tests and related first-line assays that can personalize medicine to help improve patient diagnosis

and management.

Principles of Consolidation

The accompanying consolidated financial

statements have been prepared in accordance with U.S.

generally accepted accounting principles (“GAAP”).

The consolidated financial statements include the accounts of Interpace Biosciences, Inc.

fka Interpace Diagnostics Group, Inc., Interpace

Diagnostics Corporation, and Interpace Diagnostics, LLC.

operations include the Company’s wholly-owned subsidiaries:

Group DCA, LLC (“Group DCA”), InServe Support Solutions

(Pharmakon), TVG, Inc.

(TVG, dissolved December 31, 2014) its Commercial Services (“CSO”) business unit and its Interpace

Pharma Solutions business (“Pharma Solutions”) which was sold on August 31, 2022.

All significant intercompany balances and

transactions have been eliminated in consolidation.

Company has one reporting segment:

The consolidated

financial statements include the accounts of Interpace Biosciences, Inc.

fka Interpace Diagnostics Group, Inc., Interpace Diagnostics

Corporation, and Interpace Diagnostics, LLC.

Discontinued operations include the Company’s

wholly-owned subsidiaries:

Group DCA, LLC (“Group DCA”), InServe Support Solutions (Pharmakon), TVG, Inc.

(TVG, dissolved

December 31, 2014) its Commercial Services (“CSO”) business unit and its Interpace Pharma Solutions business (“Pharma

Solutions”) which was sold on August 31, 2022.

All significant intercompany balances and transactions have been eliminated in consolidation.

The Company has one reporting segment:

the Company’s clinical services business.

The Company’s current reporting segment structure

is reflective of the way the Company’s management views the business, makes operating decisions and assesses performance.

structure allows investors to better understand Company performance, better assess prospects for future cash flows, and make more informed

decisions about the Company.

preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that

affect the amounts of assets and liabilities reported and disclosure of contingent assets and liabilities at the date of the

financial statements and the reported amounts of revenues and expenses during the reporting period.

Management’s estimates are

based on historical experience, facts and circumstances available at the time, and various other assumptions that are believed to be

reasonable under the circumstances.

Significant estimates include accounting for valuation allowances related to deferred income

taxes, contingent consideration, notes payable, allowances for doubtful accounts and notes, revenue recognition, and unrecognized

tax benefits.

The Company periodically reviews these matters and reflects

changes in estimates as appropriate.

Actual results could materially differ from those estimates.

and Cash Equivalents

and cash equivalents include unrestricted cash accounts, money market investments and highly liquid investment instruments with original

maturity of three months or less at the date of purchase.

Receivable, Net

Company’s accounts receivables represent unconditional rights to consideration and are generated using its proprietary tests.

Company’s clinical services are fulfilled upon completion of the test, review and release of the test results.

In conjunction with

fulfilling these services, the Company bills the third-party payer or direct-bill payer.

Contractual adjustments represent the difference

between the list prices and the reimbursement rates set by third party payers, including Medicare, commercial payers, and amounts billed

to direct-bill payers.

Specific accounts may be written off after several appeals, which in some cases may take longer than twelve months.

No allowance for credit losses has been recorded during the periods presented.

The opening accounts receivable balance as of January

1, 2022, was $ 4.7 million.

current assets

current assets consisted of the following as of December 31, 2023 and 2022:

of Other Current Assets

The Company’s current reporting segment structure is reflective of the way the

Company’s management views the business, makes operating decisions and assesses performance.

This structure allows investors to

better understand Company performance, better assess prospects for future cash flows, and make more informed decisions about the Company.

Accounting Estimates

The preparation of consolidated financial

statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts of assets and liabilities

reported and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues

and expenses during the reporting period.

Management’s estimates are based on historical experience, facts and circumstances available

at the time, and various other assumptions that are believed to be reasonable under the circumstances.

Significant estimates include

accounting for valuation allowances related to deferred income taxes, notes payable, stock-based compensation, revenue recognition, and

unrecognized tax benefits.

The Company periodically reviews these matters and reflects changes in estimates as appropriate.

Actual results

could materially differ from those estimates.

Cash and Cash Equivalents

Cash and cash equivalents include unrestricted

cash accounts, money market investments and highly liquid investment instruments with original maturity of three months or less at the

date of purchase.

Accounts Receivable, Net

The Company’s accounts receivables

represent unconditional rights to consideration and are generated using its proprietary tests.

The Company’s clinical services

are fulfilled upon completion of the test, review and release of the test results.

In conjunction with fulfilling these services, the

Company bills the third-party payer or direct-bill payer.

Contractual adjustments represent the difference between the list prices and

the reimbursement rates set by third party payers, including Medicare, commercial payers, and amounts billed to direct-bill payers.

accounts may be written off after several appeals, which in some cases may take longer than twelve months.

The opening accounts receivable balance, as restated, as of January 1, 2023 was $ 5.1 million.

Other current assets

and Equipment, net

and equipment are stated at cost less accumulated depreciation and amortization.

Depreciation and amortization is recognized on a straight-line

basis, using the estimated useful lives of:

Other current assets consisted of the

following as of December 31, 2024 and 2023:

of Other Current Assets

December 31, 2024

December 31, 2023

(as restated)

Prepaid expenses

Total other current assets

Property and Equipment, net

Property and equipment are stated at cost

less accumulated depreciation and amortization.

Depreciation and amortization are recognized on a straight-line basis, using the estimated

useful lives of:

five to twelve years for furniture and fixtures;

two to five years for office and computer

three to twelve years for lab equipment;

and leasehold improvements are amortized over the shorter of the estimated service

lives or the terms of the related leases which are currently one to five years .

two to five years for office and computer equipment;

two to twelve

years for lab equipment;

and leasehold improvements are amortized over the shorter of the estimated service lives or the terms of the

related leases which are currently one to five years .

Repairs and maintenance are charged to expense as incurred.

Upon disposition, the asset and related accumulated depreciation and amortization are removed from the related accounts and any gains

or losses are reflected in operations.

Software - It is the Company’s policy to capitalize certain costs incurred in connection with developing or obtaining internal-use

Capitalized software costs are included in property and equipment on the consolidated balance sheet and amortized over the

software’s useful life, generally three to seven years .

Upon disposition, the

asset and related accumulated depreciation and amortization are removed from the related accounts and any gains or losses are reflected

in operations.

Software Costs

Internal-Use Software - It is the Company’s

policy to capitalize certain costs incurred in connection with developing or obtaining internal-use software.

Capitalized software costs

are included in property and equipment on the consolidated balance sheet and amortized over the software’s useful life, generally

three to seven years .

Software costs that do not meet capitalization criteria are expensed immediately.

Note 6, Property and Equipment , for further information.

Assets, including Finite-Lived Intangible Assets

intangible assets are stated at cost less accumulated amortization.

Amortization of finite-lived acquired intangible assets is recognized

on a straight-line basis, using the estimated useful lives of the assets of approximately two years to ten years in acquisition related

amortization expense in the Consolidated Statements of Operations.

Company reviews the recoverability of long-lived assets and finite-lived intangible assets whenever events or changes in circumstances

indicate that the carrying value of such assets may not be recoverable.

If the sum of the expected future undiscounted cash flows is

less than the carrying amount of the related asset group, an impairment loss is recognized by reducing the recorded value of the asset

group to its fair value.

This analysis requires estimates of the amount and timing of projected cash flows and, where applicable, judgments

associated with, among other factors, the appropriate discount rate.

Such estimates are critical in determining whether any impairment

charge should be recorded and the amount of such charge if an impairment loss is deemed to be necessary.

There were no asset impairment losses recorded in 2023 and the Company recorded an impairment charge of $ 3.8 million

for finite-lived intangible assets associated with the Company’s sale of its Pharma Solutions business in 2022.

See Note 7, Property and Equipment ,

for further information.

Contingencies

the normal course of business, the Company is subject to various contingencies.

Contingencies are recorded in the consolidated financial

statements when it is probable that a liability will be incurred and the amount of the loss is reasonably estimable, or otherwise disclosed,

in accordance with ASC 450, Contingencies.

Significant judgment is required in both the determination of probability and the determination

as to whether a loss is reasonably estimable.

In the event the Company determines that a loss is not probable, but is reasonably possible,

and it becomes possible to develop what the Company believes to be a reasonable range of possible loss, then the Company will include

disclosures related to such matter as appropriate and in compliance with ASC 450.

To the extent there is a reasonable possibility that

the losses could exceed the amounts already accrued, the Company will, when applicable, adjust the accrual in the period the determination

is made, disclose an estimate of the additional loss or range of loss, indicate that the estimate is immaterial with respect to its financial

statements as a whole or, if the amount of such adjustment cannot be reasonably estimated, disclose that an estimate cannot be made.

The Company is not currently involved in any legal proceedings of a material nature and, accordingly, the Company has not accrued estimated

costs related to any legal claims.

derive our revenues from the performance of proprietary assays or tests.

The Company’s performance obligation is fulfilled upon

the completion, review and release of test results to the customer.

The Company subsequently bills third-party payers or direct-bill

payers for the tests performed.

Under Accounting Standards Codification 606, revenue is recognized based on the estimated transaction

price or net realizable value, which is determined based on historical collection rates by each payer category for each proprietary test

offered by the Company.

To the extent the transaction price includes variable consideration, for all third party and direct-bill payers

and proprietary tests, the Company estimates the amount of variable consideration that should be included in the transaction price using

the expected value method based on historical experience.

regularly review the ultimate amounts received from the third-party and direct-bill payers and related estimated reimbursement rates

and adjust the net realizable values (“NRV’s”) and related contractual allowances accordingly.

If actual collections

and related NRV’s vary significantly from our estimates, we will adjust the estimates of contractual allowances, which affects

net revenue in the period such variances become known.

non-Medicare claims, our payment terms vary by payer category.

Payment terms for direct-payers in our clinical services are typically

thirty days and in our pharma services, up to sixty days.

Commercial third-party-payers are required to respond to a claim within a time

period established by their respective state regulations, generally between thirty to sixty days.

However, payment for commercial third-party

claims may be subject to a denial and appeal process, which could take up to two years in some instances where multiple appeals are submitted.

The Company generally appeals all denials from commercial third-party payers.

We bill Medicare directly for tests performed for Medicare

patients and must accept Medicare’s fee schedule for the covered tests as payment in full.

of revenue consists primarily of the costs associated with operating our laboratories and other costs directly related to our tests.

Personnel costs, which constitute the largest portion of cost of services, include all labor related costs, such as salaries, bonuses,

fringe benefits and payroll taxes for laboratory personnel.

Other direct costs include, but are not limited to, laboratory supplies,

certain consulting expenses, royalty expenses, and facility expenses.

compensation cost associated with the granting of stock-based awards is based on the grant date fair value of the stock award.

recognizes the compensation cost, net of estimated forfeitures, over the shorter of the vesting period or the period from the grant date

to the date when retirement eligibility is achieved.

Forfeitures are initially estimated based on historical information and subsequently

updated over the life of the awards to ultimately reflect actual forfeitures.

As a result, changes in forfeiture activity can influence

the amount of stock compensation cost recognized from period to period.

The Company primarily uses the Black-Scholes option-pricing model

to determine the fair value of stock options.

The determination of the fair value of stock-based payment awards is made on the date of

grant and is affected by the Company’s stock price as well as assumptions made regarding a number of complex and subjective variables.

In the normal course of business, the

Company is subject to various contingencies.

Contingencies are recorded in the consolidated financial statements when it is probable

that a liability will be incurred and the amount of the loss is reasonably estimable, or otherwise disclosed, in accordance with ASC

450, Contingencies.

Significant judgment is required in both the determination of probability and the determination as to whether a loss

is reasonably estimable.

In the event the Company determines that a loss is not probable, but is reasonably possible, and it becomes

possible to develop what the Company believes to be a reasonable range of possible loss, then the Company will include disclosures related

to such matter as appropriate and in compliance with ASC 450.

To the extent there is a reasonable possibility that the losses could exceed

the amounts already accrued, the Company will, when applicable, adjust the accrual in the period the determination is made, disclose

an estimate of the additional loss or range of loss, indicate that the estimate is immaterial with respect to its financial statements

as a whole or, if the amount of such adjustment cannot be reasonably estimated, disclose that an estimate cannot be made.

is not currently involved in any legal proceedings of a material nature and, accordingly, the Company has not accrued estimated costs

related to any legal claims.

Revenue Recognition

We derive our revenues from the performance

of proprietary assays or tests.

The Company’s performance obligation is fulfilled upon the completion, review and release of test

results to the customer.

The Company subsequently bills third-party payers or direct-bill payers for the tests performed.

Under Accounting

Standards Codification 606, revenue is recognized based on the estimated transaction price or net realizable value, which is determined

based on historical collection rates by each payer category for each proprietary test offered by the Company.

To the extent the transaction

price includes variable consideration, for all third party and direct-bill payers and proprietary tests, the Company estimates the amount

of variable consideration that should be included in the transaction price using the expected value method based on historical experience.

We regularly review the ultimate amounts

received from the third-party and direct-bill payers and related estimated reimbursement rates and adjust the net realizable values (“NRV’s”)

and related contractual allowances accordingly.

If actual collections and related NRV’s vary significantly from our estimates,

we will adjust the estimates of contractual allowances, which affects net revenue in the period such variances become known.

Financing and Payment

For non-Medicare claims, our payment terms

vary by payer category.

Payment terms for direct-payers in our clinical services are typically thirty days.

Commercial third-party-payers

are required to respond to a claim within a time period established by their respective state regulations, generally between thirty to

However, payment for commercial third-party claims may be subject to a denial and appeal process, which could take up to

two years in some instances where multiple appeals are submitted.

The Company generally appeals all denials from commercial third-party

We bill Medicare directly for tests performed for Medicare patients and must accept Medicare’s fee schedule for the covered

tests as payment in full.

Cost of revenue

Cost of revenue consists primarily of

the costs associated with operating our laboratories and other costs directly related to our tests.

Personnel costs, which constitute

the largest portion of cost of services, include all labor related costs, such as salaries, bonuses, fringe benefits and payroll taxes

for laboratory personnel.

Other direct costs include, but are not limited to, laboratory supplies, certain consulting expenses, royalty

expenses, and facility expenses.

Stock-Based Compensation

The compensation cost associated with

the granting of stock-based awards is based on the grant date fair value of the stock award.

The Company recognizes the compensation

cost, net of estimated forfeitures, over the shorter of the vesting period or the period from the grant date to the date when retirement

eligibility is achieved.

Forfeitures are initially estimated based on historical information and subsequently updated over the life of

the awards to ultimately reflect actual forfeitures.

As a result, changes in forfeiture activity can influence the amount of stock compensation

cost recognized from period to period.

The Company primarily uses the Black-Scholes option-pricing model to determine the fair value

of stock options.

The determination of the fair value of stock-based payment awards is made on the date of grant and is affected by the

Company’s stock price as well as assumptions made regarding a number of complex and subjective variables.

These assumptions include:

expected stock price volatility over the term of the awards;

actual and projected employee stock option exercise

the risk-free interest rate;

actual and projected employee stock option exercise behaviors;

the risk-free

interest rate;

and expected dividend yield.

The fair value of restricted stock units, or RSUs, and restricted

shares is equal to the closing stock price on the date of grant.

Note 14, Stock-Based Compensation, for further information.

stock purchases are accounted for under the cost method whereby the entire cost of the acquired stock is recorded as treasury stock.

Upon reissuance of shares, the Company records any difference between the weighted-average cost of such shares and any proceeds received

as an adjustment to additional paid-in capital.

Company determines if an arrangement contains a lease in whole or in part at the inception of the contract.

Right-of-use (“ROU”)

assets represent the Company’s right to use an underlying asset for the lease term while lease liabilities represent our obligation

to make lease payments arising from the lease.

All leases with terms greater than twelve months result in the recognition of a ROU asset

and a liability at the lease commencement date based on the present value of the lease payments over the lease term.

Unless a lease provides

all of the information required to determine the implicit interest rate, we use our incremental borrowing rate based on the information

available at the commencement date in determining the present value of the lease payments.

lease terms include all non-cancelable periods and may include options to extend (or to not terminate) the lease when it is reasonably

certain that we will exercise that option.

Leases with terms of twelve months or less at the commencement date are expensed on a straight-line

basis over the lease term and do not result in the recognition of an asset or liability.

The fair value of restricted stock units, or RSUs, and restricted shares is equal to the

closing stock price on the date of grant.

See Note 14, Stock-Based Compensation,

for further information.

The Company determines if an arrangement

contains a lease in whole or in part at the inception of the contract.

Right-of-use (“ROU”) assets represent the Company’s

right to use an underlying asset for the lease term while lease liabilities represent our obligation to make lease payments arising from

All leases with terms greater than twelve months result in the recognition of a ROU asset and a liability at the lease commencement

date based on the present value of the lease payments over the lease term.

Unless a lease provides all of the information required to

determine the implicit interest rate, we use our incremental borrowing rate based on the information available at the commencement date

in determining the present value of the lease payments.

Our lease terms include all non-cancelable

periods and may include options to extend (or to not terminate) the lease when it is reasonably certain that we will exercise that option.

Leases with terms of twelve months or less at the commencement date are expensed on a straight-line basis over the lease term and do

not result in the recognition of an asset or liability.

See Note 8, Leases .

taxes are based on income for financial reporting purposes calculated using the Company’s annual tax rate and reflect a current

tax liability or asset for the estimated taxes payable or recoverable on the current year tax return and expected annual changes in deferred

Any interest or penalties on income tax are recognized as a component of income tax expense.

Company accounts for income taxes using the asset and liability method.

This method requires recognition of deferred tax assets and liabilities

for expected future tax consequences of temporary differences that currently exist between tax basis and financial reporting basis of

the Company’s assets and liabilities based on enacted tax laws and rates.

Deferred tax expense (benefit) is the result of changes

in the deferred tax asset and liability.

A valuation allowance is established, when necessary, to reduce the deferred income tax assets

when it is more likely than not that all or a portion of a deferred tax asset will not be realized.

Company operates in multiple tax jurisdictions and pays or provides for the payment of taxes in each jurisdiction where it conducts business

and is subject to taxation.

The breadth of the Company’s operations and the complexity of the tax law require assessments of uncertainties

and judgments in estimating the ultimate taxes the Company will pay.

The final taxes paid are dependent upon many factors, including

negotiations with taxing authorities in various jurisdictions, outcomes of tax litigation and resolution of proposed assessments arising

from federal and state audits.

Uncertain tax positions are recognized in the financial statements when it is more likely than not (i.e.,

a likelihood of more than fifty percent) that a position taken or expected to be taken in a tax return would be sustained upon examination

by tax authorities that have full knowledge of all relevant information.

A recognized tax position is then measured as the largest amount

of benefit that is greater than fifty percent likely to be realized upon ultimate settlement.

The Company adjusts accruals for unrecognized

tax benefits as facts and circumstances change, such as the progress of a tax audit.

However, any adjustments made may be material to

the Company’s consolidated results of operations or cash flows for a reporting period.

Penalties and interest, if incurred, would

be recorded as a component of current income tax expense.

judgment is also required in evaluating the need for and magnitude of appropriate valuation allowances against deferred tax assets.

tax assets are regularly reviewed for recoverability.

The Company currently has significant deferred tax assets resulting from net operating

loss carryforwards and deductible temporary differences, which should reduce taxable income in future periods, if generated.

The realization

of these assets is dependent on generating future taxable income.

(Loss) per Share

earnings per common share are computed by dividing net income by the weighted average number of shares outstanding during the year including

any unvested share-based payment awards that contain nonforfeitable rights to dividends.

Diluted earnings per common share are computed

by dividing net income by the sum of the weighted average number of shares outstanding and dilutive common shares under the treasury

Unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or

unpaid), are participating securities and are included in the computation of earnings per share pursuant to the two-class method.

a result of the losses incurred in 2022, the potentially dilutive common shares have been excluded from the earnings per share computation

for this period because its inclusion would have been anti-dilutive.

Additionally, preferred shares have been excluded in the denominator

of the earnings per share computation, on an if-converted basis, as such shares would have been anti-dilutive.

Reclassifications

The Company reclassified certain prior period balances to conform to the current year presentation.

Recent Accounting Standards

Pronouncements Adopted

FASB issued new guidance under ASC Topic 326, Financial Instruments Credit Losses.

The guidance changes the allowance on accounts receivable

from an incurred method to an expected method.

The Company adopted ASC Topic 326 on January 1, 2023 which requires the Company to look at its history of write-offs to come up with an expected loss rate and apply that

to its current accounts receivable balance.

It had no material effect on

the consolidated financial statements.

Pronouncements Pending

August 2020, the FASB issued ASU 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging

– Contracts in Entity’s Own Equity (Subtopic 815 – 40), (“ASU 2020-06”).

ASU 2020-06 simplifies the accounting

for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on

an entity’s own equity.

The ASU 2020-06 amendments are effective for fiscal years beginning after December 15, 2023, and interim

periods within those fiscal years.

Early adoption is permitted.

The Company does not expect this will have any impact on its consolidated

Income taxes are based on income for financial

reporting purposes calculated using the Company’s annual tax rate and reflect a current tax liability or asset for the estimated

taxes payable or recoverable on the current year tax return and expected annual changes in deferred taxes.

Any interest or penalties

on income tax are recognized as a component of income tax expense.

The Company accounts for income taxes

using the asset and liability method.

This method requires recognition of deferred tax assets and liabilities for expected future tax

consequences of temporary differences that currently exist between tax basis and financial reporting basis of the Company’s assets

and liabilities based on enacted tax laws and rates.

Deferred tax expense (benefit) is the result of changes in the deferred tax asset

and liability.

A valuation allowance is established, when necessary, to reduce the deferred income tax assets when it is more likely

than not that all or a portion of a deferred tax asset will not be realized.

The Company operates in multiple tax jurisdictions

and pays or provides for the payment of taxes in each jurisdiction where it conducts business and is subject to taxation.

of the Company’s operations and the complexity of the tax law require assessments of uncertainties and judgments in estimating

the ultimate taxes the Company will pay.

The final taxes paid are dependent upon many factors, including negotiations with taxing authorities

in various jurisdictions, outcomes of tax litigation and resolution of proposed assessments arising from federal and state audits.

tax positions are recognized in the financial statements when it is more likely than not (i.e., a likelihood of more than fifty percent)

that a position taken or expected to be taken in a tax return would be sustained upon examination by tax authorities that have full knowledge

of all relevant information.

A recognized tax position is then measured as the largest amount of benefit that is greater than fifty percent

likely to be realized upon ultimate settlement.

The Company adjusts accruals for unrecognized tax benefits as facts and circumstances

change, such as the progress of a tax audit.

However, any adjustments made may be material to the Company’s consolidated results

of operations or cash flows for a reporting period.

Penalties and interest, if incurred, would be recorded as a component of current

income tax expense.

Significant judgment is also required

in evaluating the need for and magnitude of appropriate valuation allowances against deferred tax assets.

Deferred tax assets are regularly

reviewed for recoverability.

The Company currently has significant deferred tax assets resulting from net operating loss carryforwards

and deductible temporary differences, which should reduce taxable income in future periods, if generated.

The realization of these assets

is dependent on generating future taxable income.

Income (Loss) per Share

Basic earnings per common share are computed

by dividing net income by the weighted average number of shares outstanding during the year including any unvested share-based payment

awards that contain nonforfeitable rights to dividends.

Diluted earnings per common share are computed by dividing net income by the

sum of the weighted average number of shares outstanding and dilutive common shares under the treasury method.

Unvested share-based payment

awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid), are participating securities

and are included in the computation of earnings per share pursuant to the two-class method.

Restatement of Previously Issued Consolidated

Financial Statements

December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

We have restated herein our

audited consolidated financial statements as of December 31, 2023 and for the year ended December 31, 2023 as well as unaudited financial

statements for the periods as of and the periods ending March 31, 2023, June 30, 2023, September 30, 2023, March 31, 2024, June 30, 2024

and September 30, 2024.

We have also restated impacted amounts within the accompanying footnotes to the consolidated financial statements

which have been noted as such.

As a result of a review of the

Company’s existing royalty agreements it was determined that the Company should not have been accruing royalty expenses on certain

As a result, the Company determined that prior period financial statements should be restated.

On February 28, 2025, the Company’s management concluded and subsequently

confirmed with the Audit Committee of the Company’s Board of Directors that (1) the royalty accrual was materially misstated and

should be reversed;

(2) the consolidated financial statements contained in the Company’s Annual Reports on Form 10-K for the years

ended December 31, 2015 through December 31, 2023, as well as the consolidated financial statements contained in the Quarterly Reports

on Form 10-Q for each quarterly period within those fiscal years as well as the quarterly periods ended March 31, 2024, June 30, 2024,

and September 30, 2024 should no longer be relied upon.

As a result, the Company is restating its consolidated financial statements for

the year ended December 31, 2023, and the quarterly periods for 2023 and 2024.

The following tables present

reconciliation from our prior periods as previously reported to the restated values for the consolidated financial statements.

A description

of misstatements is listed below:

Royalty expense - We recorded royalty expense with respect to certain

royalty agreements through September 30, 2024.

The reversal of that expense will be reflected in the financial statements below.

Revenue adjustments – Adjustments related to the timing on which

revenue is recognized as per our revenue recognition policy.

The Company identified a material control weakness in 2023

related to these adjustments.

The following tables present a reconciliation of the as previously reported

consolidated financial statements to the restated amounts as of and for the year ended December 31, 2023.

Schedule of Restatement Consolidated Financial Statements

BIOSCIENCES, INC.

BALANCE SHEET

thousands, except share and per share data)

December 31, 2023

As Previously Reported

Restatement Amount

Restatement Reference

Current assets:

Cash and cash equivalents

Accounts receivable

Other current assets

Total current assets

Property and equipment, net

Operating lease right of use assets

Other long-term assets

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities:

Accounts payable

Accrued salary and bonus

Other accrued expenses

Note payable at fair value, current

Current liabilities of discontinued operations

Total current liabilities

Operating lease liabilities, net of current portion

Note payable at fair value

Other long-term liabilities

Total liabilities

Redeemable preferred stock, $ .01 par value;

5,000,000 shares authorized, 47,000 shares Series B issued and outstanding

Stockholders’ deficit:

Common stock, $ .01 par value;

100,000,000 shares authorized;

4,447,489 shares issued and 4,351,445 shares outstanding;

Common stock, $.01 par value;

100,000,000 shares authorized;4,447,489 shares issued and 4,351,445 shares outstanding;

Additional paid-in capital

Accumulated deficit

Treasury stock, at cost ( 96,044 shares)

Total stockholders’ deficit

Total liabilities and stockholders’ deficit

Total liabilities, preferred stock and stockholders’ deficit

The accompanying notes are an integral part of these condensed consolidated

financial statements

INTERPACE BIOSCIENCES, INC.

CONSOLIDATED STATEMENTS OF

(in thousands, except for per share data)

As Previously Reported

Restatement Amount

Restatement Reference

For the Year Ended December 31, 2023

As Previously Reported

Restatement Amount

Restatement Reference

Cost of revenue

Operating expenses:

Sales and marketing

Research and development

General and administrative

Acquisition related amortization expense

Change in fair value of contingent consideration

Total operating expenses

Operating income from continuing operations

Interest accretion expense

Note payable interest expense

Other expense, net

Income from continuing operations before tax

Provision for income taxes

Income from continuing operations

Loss from discontinued operations, net of tax

Basic net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per basic share of common stock

Diluted net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per diluted share of common stock

Weighted average number of common shares and common share equivalents outstanding:

The accompanying notes are

an integral part of these condensed consolidated financial statements

Consolidated Statement of

Stockholders’ Deficit

-December 31, 2023 as reported

$ ( 248,215 )

adjustments to accumulated deficit in prior years

adjustments to net income

-December 31, 2023 as restated

$ ( 242,082 )

INTERPACE BIOSCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENT

OF CASH FLOWS

(unaudited, in thousands)

As Previously Reported

Restatement Amount

Restatement Reference

For The Year Ended December 31,

As Previously Reported

Restatement Amount

Restatement Reference

Cash Flows From Operating Activities

Adjustments to reconcile net income to net cash used in operating activities:

Depreciation and amortization

Interest accretion expense

Amortization of deferred financing fees

Amortization on operating lease right of use asset

Stock-based compensation

Credit loss expense

Change in fair value of note payable

Change in fair value of contingent consideration

Other changes in operating assets and liabilities:

Accounts receivable

Other current assets

Accounts payable

Accrued salaries and bonus

Other accrued expenses

Operating lease liabilities

Long-term liabilities

Net cash provided by operating activities

Cash Flows From Investing Activity

Proceeds from sale of Interpace Pharma Solutions, net

Purchase of property and equipment

Net cash used in investing activities

Cash Flows From Financing Activities

Payment of BroadOak terminal payment

Payments on line of credit

Cash paid for repurchase of restricted shares

Net cash used in financing activities

Net decrease in cash and cash equivalents

Cash and cash equivalents from continuing operations– beginning

Cash and cash equivalents from discontinued operations– beginning

Cash and cash equivalents – beginning

Cash and cash equivalents from continuing operations– ending

Cash and cash equivalents from discontinued operations– ending

Cash and cash equivalents – ending

Recent Accounting Standards

Accounting Pronouncements Adopted

In August 2020, the FASB issued ASU 2020-06,

Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s

Own Equity (Subtopic 815 – 40), (“ASU 2020-06”).

ASU 2020-06 simplifies the accounting for certain financial instruments

with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity.

ASU 2020-06 amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years.

This was adopted on January 1, 2024 and there was no impact upon adoption.

In November 2023, the FASB modified authoritative

guidance within the codification’s Segment Reporting topic (ASC 280), which enhanced the disclosure requirements for significant

segment expenses and other segment items.

The authoritative guidance will become effective for fiscal years beginning after December

15, 2023, and for interim periods within fiscal years beginning after December 15, 2024.

The adoption of this standard for the year ended

December 31, 2024 did not have a material impact on the Company’s consolidated financial results, but resulted in enhanced disclosures

as included in Note 15, Segments .

Accounting Pronouncements Pending

In December 2023, the FASB issued ASU

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures.

This ASU requires public

entities, on an annual basis, to provide disclosure of specific categories in the rate reconciliation, as well as disclosure of income

taxes paid disaggregated by jurisdiction.

ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption

The Company is currently evaluating the impact the adoption of this standard on its financial statements.

October 2021, the Company entered into a $ 7.5 million revolving credit facility with Comerica Incorporated (“Comerica”) (the

“Comerica Loan Agreement”).

See Note 18, Revolving Line of Credit, and Note 20, Subsequent Events for more details and for

updates to the revolving credit facility.

Also in October 2021, the Company entered into an $ 8.0 million term loan with BroadOak Fund

(“BroadOak”) (the “BroadOak Loan Agreement”), the proceeds of which were used to repay in full at their

maturity the existing secured promissory note with Ampersand Capital Partners (“Ampersand”) (the “Ampersand Note”)

and 1315 Capital II, L.P (“1315 Capital”) (the “1315 Capital Note”).

In May 2022, the Company entered into a

Subordinated Convertible Promissory Note agreement with BroadOak for an additional $ 2.0 million (the “Convertible Note”),

which was converted into a subordinated term loan and was added to the outstanding BroadOak Loan Agreement balance.

See Note 13, Notes

Payable, for more details.

December 31, 2023, the Company has a $ 10 million principal balance of notes payable that required the principal to be paid on or before

the maturity date of October 31, 2024 .

In March 2024, the Company had the terms of the Loan Agreement updated.

See Note 20, Subsequent

Events , for more details.

with many laboratories, the Company may be affected by the Proposed Local Coverage Determination (“LCD”) DL39365, which is

currently under consideration by Novitas.

This ASU requires public entities, on an annual basis, to

provide disclosure of specific categories in the rate reconciliation, as well as disclosure of income taxes paid disaggregated by jurisdiction.

ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company is currently

evaluating the impact the adoption of this standard on its financial statements but does not expect it to be material.

In October 2021, the Company entered into

a $ 7.5 million revolving credit facility with Comerica Bank (“Comerica”) (the “Comerica Loan Agreement”).

February 2024, the Company terminated the Comerica Loan Agreement.

The Company did not owe anything outstanding on the line of credit

at the time of termination and does not owe anything further to Comerica.

See Note 19, Revolving Line of Credit .

Also in October

2021, the Company entered into an $ 8.0 million term loan with BroadOak Fund V, L.P.

(“BroadOak”) (the “Term Loan”),

the proceeds of which were used to repay in full at their maturity the existing secured promissory note with Ampersand Capital Partners

(“Ampersand”) and 1315 Capital II, L.P (“1315 Capital”).

In May 2022, the Company entered into a Subordinated

Convertible Promissory Note agreement with BroadOak for an additional $ 2.0 million (the “Convertible Note”), which was converted

into a subordinated term loan and was added to the outstanding Term Loan balance.

The Term Loan has been subsequently amended.

13, Notes Payable , for more details.

At December 31, 2024, the Company has

a $ 4.4 million principal balance of notes payable that required the principal to be paid on or before the maturity date of June 30, 2025.

In January 2025, the Company had the terms of the Loan Agreement updated.

See Note 21, Subsequent Events , for more details.

Further, along with many laboratories,

the Company may be affected by the Proposed Local Coverage Determination (“LCD”) DL39365, which is currently under consideration

by our local Medicare Administrative Contractor, Novitas.

If finalized, this Proposed LCD, which governs “Genetic Testing for Oncology,”

10 unchanged sentences

supporting the use of PancraGEN ® .

The timing and content of any final implemented LCD is uncertain at this time;

could potentially take a year or longer from issuance of the updated proposed LCD to reach a conclusion.

As a result, the Company is

able to continue offering PancraGEN ® and the related Point2 ® fluid chemistry tests for amylase, CEA, and

In the event Novitas ultimately restricts coverage for the PancraGEN ® test, the Company’s liquidity could

be negatively impacted.

the year ended December 31, 2023, the Company had operating income from continuing operations of $ 2.8 million.

As of December 31, 2023,

the Company had cash and cash equivalents of $ 3.5 million, total current assets of $ 10.3 million and current liabilities of $ 17.5 million.

As of March 22, 2024, the Company had approximately $ 2.8 million of cash on hand.

Company intends to meet its ongoing capital needs by using its available cash, as well as through targeted margin improvement;

of accounts receivable;

containment of costs;

On July 29, 2024, the Company announced that the Center for Medicare and Medicaid Services

(“CMS”) granted Novitas an undefined extension to the final decision for the LCD.

As a result, the Company was able to continue

offering PancraGEN ® and the related Point2 ® fluid chemistry tests for amylase, CEA, and glucose for all

On January 9, 2025, the Company

announced the new LCD established non-coverage for its PancraGEN ® test, and it would stop offering the test and would

not accept specimens for first-line fluid chemistry and PancraGEN ® testing after February 7, 2025.

As a result of the

established non-coverage for PancraGEN ® , the Company announced, in January 2025, that its board of directors had approved

a restructuring and cost-savings plan to reduce operating costs and better align its workforce with the loss of PancraGEN ® (the

“Restructuring Plan”).

On January 27, 2025, the Company announced

that CMS had directed its Medicare Administrative Contractors, Novitas and First Coast Service Options, Inc., to delay implementation

of the Genetic Testing for Oncology LCD (L39365), from February 23, 2025 until April 24, 2025.

The Company stated that this change of

effective date will allow the Trump administration time to fully review the proposed policy changes, re-evaluate for themselves the supporting

clinical evidence for the PancraGEN ® assay, and fully assess the negative impact on patient care if the currently proposed

LCD comes into effect.

As a result of CMS’ determination

to delay implementation of the Genetic Testing for Oncology LCD (L39365), the Company is re-evaluating certain parts of the Restructuring

Plan and will determine what parts will or will not be postponed or cancelled.

For the year ended December 31, 2024,

the Company had operating income from continuing operations of $ 8.1 million.

As of December 31, 2024, the Company had cash and cash equivalents

of $ 1.5 million, total current assets of $ 11.8 million and current liabilities of $ 10.6 million.

As of March 21, 2025, the Company had

approximately $ 1.3 million of cash on hand.

The Company intends to meet its ongoing

capital needs by using its available cash, as well as through targeted margin improvement;

collection of accounts receivable;

and the potential use of other financing options and other strategic alternatives.

Company continues to explore various strategic alternatives, dilutive and non-dilutive sources of funding, including equity and debt

financings, strategic alliances, business development and other sources in order to provide additional liquidity.

With the delisting

of its common stock from Nasdaq in February 2021, the Company’s ability to raise additional capital on terms acceptable to it has

been adversely impacted.

There can be no assurance that the Company will be successful in obtaining such funding on terms acceptable

the improvement in operating cash flows associated with the disposition of the Pharma Solutions business, and the Company’s improved

operating performance, as of the date of this filing, the Company anticipates that current cash and cash equivalents and forecasted

cash receipts will be sufficient to meet its anticipated cash requirements through the next twelve months from the date of issuance of the consolidated financial statements.

The Company continues to explore various

strategic alternatives, dilutive and non-dilutive sources of funding, including equity and debt financings, strategic alliances, business

development and other sources in order to provide additional liquidity.

With the delisting of its common stock from Nasdaq in February

2021, the Company’s ability to raise additional capital on terms acceptable to it has been adversely impacted.

There can be no

assurance that the Company will be successful in obtaining such funding on terms acceptable to it.

The Company may seek an uplisting

of its common stock to Nasdaq, but no assurances can be given that a Nasdaq listing will be achieved.

With the improvement in operating cash

flows associated with the disposition of the Pharma Solutions business, and the Company’s improved operating performance, as of

the date of this filing, the Company anticipates that current cash and cash equivalents and forecasted cash receipts will be sufficient

to meet its anticipated cash requirements through the next twelve months from the date of issuance of the consolidated financial statements.

Discontinued Operations

August 31, 2022, the Company entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Flagship Biosciences,

(the “Purchaser”) pursuant to which the Purchaser agreed to (i) acquire substantially all of the assets of Interpace

Pharma Solutions, Inc.

used in its business of complex molecular analysis for the early diagnosis and treatment of cancer and supporting

the development of targeted therapeutics (the “Business”) and (ii) assume and pay certain liabilities related to the purchased

assets (collectively, the “Transaction”).

The Transaction closed on August 31, 2022.

consideration for the Transaction, Interpace received a total sale price of approximately $ 6.2 million after working capital and other

adjustments ($ 0.5 million of which has been deposited into escrow).

In addition, the Purchaser paid the Company an earnout of approximately

$ 1.0 million based on revenue for the period beginning September 1, 2021 and ending August 31, 2022.

In the third quarter of 2023, the

$ 0.5 million funds in escrow were released to the Company.

Purchase Agreement includes a one-year commitment of Interpace not to compete with the Business, recruit or hire any former employees

of the Subsidiary who accept employment with the Purchaser in connection with the Transaction, or divert or attempt to divert from Purchaser

any business to be performed from any of the contracts or agreements with customers as set forth in the Purchase Agreement.

Agreement also contains customary representations and warranties, post-closing covenants and mutual indemnification obligations for,

among other things, any inaccuracy or breach of any representation or warranty and any breach or non-fulfillment of any covenant.

connection with the Transaction, on August 31, 2022, Interpace and Purchaser entered into a Shared Services Agreement (the “Shared

Services Agreement”) pursuant to which Interpace agreed to provide, or cause its affiliates to provide, to the Purchaser certain

services set forth in the Shared Services Agreement on a transitional basis and subject to the terms and conditions set forth in the

Shared Services Agreement (the “Services”).

As consideration for the Services provided by Interpace, Purchaser will pay Interpace

the amounts specified for each Service as set forth in the Shared Services Agreement.

The Company’s obligations to provide the

Services will terminate with respect to each Service as set forth in the Shared Services Agreement.

Purchaser is identified as a related party as an affiliate of Ampersand and an affiliate of BroadOak and have each provided equity financing

to the Purchaser.

Collectively, they own a majority of the Purchaser’s outstanding equity securities and are represented on its

Board of Directors.

Company intends to use the remaining net proceeds to fund its future business activities and for general working capital purposes.

a result of the sale, the gain on sale and all operations from Interpace Pharma Solutions have been classified as discontinued operations

for all periods presented.

reconciliation of the accounting for the Company’s Pharma Solutions business in 2023 and 2022 is as follows:

of Sale of Business

(loss) on Sale

capital adjustment, net

transaction costs

net consideration

and liabilities disposed of, net (1)

(loss) on sale

goodwill and intangible assets written down prior to the Transaction.

The goodwill write-down was approximately $ 8.4 million and

the write-down of intangible assets was approximately $ 3.8 million.

components of assets and liabilities classified as discontinued operations consist of the following as of December 31, 2023 and December

of Components of Assets and Liabilities and Revenue Classified as Discontinued Operations

salary and bonus

liabilities of discontinued operations

$ 660 and $ 766 of liabilities related to the former Commercial Services business unit for the periods ending December 31, 2023 and

December 31, 2022, respectively.

table below presents the significant components of its former Pharma Solutions and Commercial Services business units’ results

included within loss from discontinued operations, net of tax in the consolidated statements of operations for the years ended December

31, 2023 and 2022.

The Years Ended

from discontinued operations

from discontinued operations, net of tax

income tax expense for the years ended December 31, 2023 and December 31, 2022 primarily pertained to the interest accrued on uncertain

tax position liabilities.

used from discontinued operations, operating activities, for the year ended December 31, 2023 was approximately $ 0.1 million.

cash provided by discontinued operations, investing activities, for the year ended December 31, 2023 of $ 0.4 million which pertained

to the net proceeds released from escrow for the Pharma Solutions sale net of final working capital adjustments.

Cash used from discontinued

operations, operating activities, for the year ended December 31, 2022 was approximately $ 2.8 million.

There was cash provided by discontinued

operations, investing activities, for the year ended December 31, 2022 of $ 6.5 million which pertained to the net proceeds received from

the Pharma Solutions sale.

Depreciation and amortization expense within discontinued operations for the year ended December 31, 2022

was $ 1.1 million.

There was no depreciation and amortization expense within discontinued operations for the year ended December 31, 2023.

Liabilities classified as discontinued

operations as of both December 31, 2024 and December 31, 2023 consists of accrued expenses which are liabilities related to the former

Commercial Services business unit.

The table below presents the significant

components of its former Pharma Solutions and Commercial Services business units’ results included within loss from discontinued

operations, net of tax in the consolidated statements of operations for the years ended December 31, 2024 and 2023.

of Components of Assets and Liabilities and Revenue Classified as Discontinued

For The Years Ended

(as restated)

Loss from discontinued operations

Income tax expense

Loss from discontinued operations, net of tax

The income tax expense for the years ended

December 31, 2024 and December 31, 2023 primarily pertained to the interest accrued on uncertain tax position liabilities.

There were no cash flows associated with

discontinued operations in 2024.

Cash used from discontinued operations, operating activities, for the year ended December 31, 2023 was

approximately $ 0.1 million.

There was cash provided by discontinued operations, investing activities, for the year ended December 31,

2023 of $ 0.4 million which pertained to the net proceeds released from escrow for the Pharma Solutions sale net of final working capital

There was no depreciation and amortization expense within discontinued operations for the years ended December 31, 2024

and December 31, 2023.

Fair Value Measurements

and cash equivalents, accounts receivable, and accounts payable approximate fair value due to their relative short-term nature.

The Company’s

financial liabilities reflected at fair value in the consolidated financial statements include contingent consideration and notes payable.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market

participants at the measurement date.

Cash and cash equivalents, accounts receivable,

and accounts payable approximate fair value due to their relative short-term nature.

The Company’s financial liabilities reflected

at fair value in the consolidated financial statements include contingent consideration and notes payable.

Fair value is the price that

would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement

In determining fair value, the Company uses various methods including market, income and cost approaches.

Based on these approaches, the Company often utilizes certain assumptions that market participants would use in pricing the asset or

liability, including assumptions about risk and/or the risks inherent in the inputs to the valuation technique.

These inputs can be readily

observable, market-corroborated, or generally unobservable inputs.

The Company utilizes valuation techniques that maximize the use of

observable inputs and minimize the use of unobservable inputs.

Based upon observable inputs used in the valuation techniques, the Company

is required to provide information according to the fair value hierarchy.

The fair value hierarchy ranks the quality and reliability

of the information used to determine fair values into three broad levels as follows:

for assets and liabilities traded in active markets from readily available pricing sources for market transactions involving identical

assets or liabilities.

for assets and liabilities traded in less active dealer or broker markets.

Valuations are obtained from third-party pricing services

for identical or similar assets or liabilities.

for assets and liabilities include certain unobservable inputs in the assumptions and projections used in determining the fair value

assigned to such assets or liabilities.

instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy,

the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is

significant to the fair value measurement in its entirety.

The Company’s assessment of the significance of a particular input to

the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

The valuation

methodologies used for the Company’s financial instruments measured on a recurring basis at fair value, including the general classification

of such instruments pursuant to the valuation hierarchy, is set forth in the tables below.

Based on these approaches,

the Company often utilizes certain assumptions that market participants would use in pricing the asset or liability, including assumptions

about risk and/or the risks inherent in the inputs to the valuation technique.

These inputs can be readily observable, market-corroborated,

or generally unobservable inputs.

The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the

use of unobservable inputs.

Based upon observable inputs used in the valuation techniques, the Company is required to provide information

according to the fair value hierarchy.

The fair value hierarchy ranks the quality and reliability of the information used to determine

fair values into three broad levels as follows:

Valuations for assets and liabilities traded in active markets from

readily available pricing sources for market transactions involving identical assets or liabilities.

Valuations for assets and liabilities traded in less active dealer

or broker markets.

Valuations are obtained from third-party pricing services for identical or similar assets or liabilities.

Valuations for assets and liabilities include certain unobservable

inputs in the assumptions and projections used in determining the fair value assigned to such assets or liabilities.

In instances where the determination of

the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy

within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement

in its entirety.

The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety

requires judgment and considers factors specific to the asset or liability.

The valuation methodologies used for the Company’s

financial instruments measured on a recurring basis at fair value, including the general classification of such instruments pursuant

to the valuation hierarchy, is set forth in the tables below.

of Financial Instrument Measured On Recurring Basis

Value Measurements

of December 31, 2023

consideration:

Value Measurements

of December 31, 2022

consideration:

Note 10, Accrued Expenses and Other Long-Term Liabilities

connection with the acquisition of certain assets from Asuragen, the Company recorded contingent consideration related to contingent

payments and other revenue-based payments.

The Company determined the fair value of the contingent consideration based on a probability-weighted

income approach derived from revenue estimates.

The fair value measurement is based on significant inputs not observable in the market

and thus represents a Level 3 measurement.

Company records the BroadOak loan at fair value.

The fair value of the loan is determined by a probability-weighted approach regarding

the loan’s change in control feature.

As of December 31, 2024

Fair Value Measurements

As of December 31, 2024

Note payable:

BroadOak loan

Fair Value Measurements

As of December 31, 2023

Contingent consideration:

Note payable:

BroadOak loan

See Note 10, Accrued Expenses and Other Long-Term Liabilities

In connection with the acquisition of

certain assets from Asuragen, the Company recorded contingent consideration related to contingent payments and other revenue-based payments.

The Company determined the fair value of the contingent consideration based on a probability-weighted income approach derived from revenue

The fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement.

This liability was settled in 2024.

The Company records the BroadOak loan

at fair value.

The fair value of the loan is determined by a probability-weighted approach regarding the loan’s change in control

See Note 13, Notes Payable, for more details.

The fair value measurement is based

on the estimated probability of a change in control and thus represents a Level 3 measurement.

The fair value measurement is based on the estimated probability of a change

in control and thus represents a Level 3 measurement.

of Fair Value, Assets Measured On Recurring Basis, Unobservable Input Reconciliation

of the Company’s non-financial assets, such as other intangible assets are measured at fair value on a nonrecurring basis when

there is an indicator of impairment and recorded at fair value only when an impairment charge is recognized.

to Fair Value/

December 31, 2023

Accretion/Interest Accrued

Mark to Market

December 31, 2024

BroadOak loans

Property and Equipment

and equipment consisted of the following as of December 31, 2023 and 2022:

Property and equipment consisted of the

following as of December 31, 2024 and 2023:

of Property and Equipment

and office equipment

and equipment

accumulated depreciation and amortization

Furniture and fixtures

Lab and office equipment

Computer equipment

Internal-use software

Leasehold improvements

Property and equipment

and amortization expense from continuing operations was approximately $ 0.2

million for the years ended December 31, 2023 and 2022, respectively.

There was zero

internal-use software amortization expense included in depreciation and amortization expense in 2023 and 2022, and $ 0.1

million of internal use unamortized software costs at December 31, 2023 and zero at December 31, 2022.

The costs were unamortized as they were not in use at December 31, 2023.

Intangible Assets

net carrying value of the identifiable intangible assets from all acquisitions within continuing operations as of December 31, 2023 and

December 31, 2022 are as follows:

of Identifiable Intangible Assets Carrying Value

Less accumulated depreciation and amortization

Net property and equipment

Depreciation and amortization expense

from continuing operations was approximately $ 0.3 million and $ 0.2 million for the years ended December 31, 2024 and 2023, respectively.

There was $ 20,000 and zero internal-use software amortization expense included in depreciation and amortization expense in 2024 and 2023,

respectively, and $ 0.1 million of internal use unamortized software costs at December 31, 2024 and December 31, 2023, respectively.

The Company leases facilities and certain

equipment under agreements classified as operating leases, which expire at various dates through June 2028.

Substantially all of the

property leases provide for increases based upon use of utilities and landlord’s operating expenses as well as pre-defined rent

Total operating lease expense from continuing operations under these agreements for the years ended December 31, 2024 and

2023 was approximately $ 0.7 million and $ 0.8 million, respectively.

Total cash paid under these agreements for the years ended December

31, 2024 and 2023 was approximately $ 0.7 million and $ 0.8 million, respectively.

The table below presents the lease-related

assets and liabilities recorded in the Consolidated Balance Sheets:

of Lease related Assets and Liabilities

Classification on the Balance Sheet

December 31, 2024

December 31, 2023

Carrying Value

expense from continuing operations was approximately $ 0.9 million and $ 1.3 million for the years ended December 31, 2023 and 2022, respectively.

The Company’s identifiable intangible assets were fully amortized as of December 31, 2023.

Company leases facilities and certain equipment under agreements classified as operating leases, which expire at various dates

through June 2028.

Substantially all of the property leases provide for increases based upon use of utilities and landlord’s

operating expenses as well as pre-defined rent escalations.

Total operating lease expense from continuing operations under these

agreements for the years ended December 31, 2023 and 2022 was approximately $ 0.8

million and $ 0.9

million, respectively.

Total cash paid under these agreements for the years ended December 31, 2023 and 2022 was approximately

million and $ 0.9

million, respectively.

table below presents the lease-related assets and liabilities recorded in the Consolidated Balance Sheet:

of Lease related Assets and Liabilities

Classification on the

Balance Sheet

lease right of use assets

lease liabilities

accrued expenses

current lease liabilities

lease liabilities

lease liabilities, net of current portion

long-term lease liabilities

lease liabilities

weighted average remaining lease term for the Company’s operating leases was 4.3 years as of December 31, 2023 and 5.0 years as

of December 31, 2022 and the weighted average discount rate for those leases was 11.8 % and 11.7 % as of December 31, 2023 and December

31, 2022, respectively.

The Company’s operating lease expenses are recorded within “Cost of revenue” and “General

and administrative expenses.”

table below reconciles the undiscounted cash flows to the lease liabilities recorded on the Company’s Consolidated Balance Sheet

as of December 31, 2023:

Operating lease assets

Operating lease right of use assets

Total lease assets

Operating lease liabilities

Other accrued expenses

Total current lease liabilities

Other accrued expenses

Operating lease liabilities

Operating lease liabilities, net of current portion

Total long-term lease liabilities

Total lease liabilities

The weighted average remaining lease term

for the Company’s operating leases was 3.5 years as of December 31, 2024 and 4.3 years as of December 31, 2023 and the weighted

average discount rate for those leases was 12.0 % and 11.8 % as of December 31, 2024 and December 31, 2023, respectively.

The Company’s

operating lease expenses are recorded within “Cost of revenue” and “General and administrative expenses.”

The table below reconciles the undiscounted

cash flows to the lease liabilities recorded on the Company’s Consolidated Balance Sheet as of December 31, 2024:

of Maturities of Operating Lease Liabilities

minimum lease payments

Operating Leases

Total minimum lease payments

amount of lease payments representing effects of discounting

value of future minimum lease payments

Present value of future minimum lease payments

current obligations under leases

lease obligations

Long-term lease obligations

Retirement Plans

Company offers an employee 401(k) saving plan.

The Company offers an employee 401(k)

Under the Interpace Biosciences, Inc.

401(k) Plan, employees may contribute up to 50 %

of their pre- or post-tax base compensation.

The Company currently offers a safe harbor matching contribution equal to 100 % of the first

3 % of the participant’s contributed base salary plus 50 % of the participant’s base salary contributed exceeding 3 % but not

more than 5 %.

Participants are not allowed to invest any of their 401(k) funds in the Company’s common stock.

The Company’s

total contribution expense from continuing operations related to the 401(k) plan for the years ended December 31, 2023 and December 31,

2022 was approximately $ 0.3 million in both periods.

401(k) Plan, employees may contribute up to 50 % of their pre- or post-tax base compensation.

The Company currently offers a safe harbor matching contribution equal to 100 % of the first 3 % of the participant’s contributed

base salary plus 50 % of the participant’s base salary contributed exceeding 3 % but not more than 5 %.

Participants are not allowed

to invest any of their 401(k) funds in the Company’s common stock.

The Company’s total contribution expense from continuing

operations related to the 401(k) plan for the years ended December 31, 2024 and December 31, 2023 was approximately $ 0.3 million in both

Accrued Expenses and Other Long-Term Liabilities

accrued expenses consisted of the following as of December 31, 2023 and 2022:

Other accrued expenses consisted of the

following as of December 31, 2024 and 2023:

of Other Accrued Expenses

consideration

lease liability

sales and marketing - diagnostics

lab costs - diagnostics

professional fees

other accrued expenses

long-term liabilities consisted of uncertain tax positions as of December 31, 2023 and 2022.

December 31, 2024

December 31, 2023

(as restated)

Accrued royalties

Contingent consideration

Operating lease liability

Accrued sales and marketing

Accrued lab costs

Accrued professional fees

Taxes payable

Unclaimed property

Total other accrued expenses

Other long-term liabilities consisted

of uncertain tax positions as of December 31, 2024 and 2023.

Commitments and Contingencies

time to time, the Company may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business.

When the Company is aware of a claim or potential claim, it assesses the likelihood of any loss or exposure.

If it is probable that a

loss will result and the amount of the loss can be reasonably estimated, the Company will record a liability for the loss.

to the estimated loss, the recorded liability includes probable and estimable legal costs associated with the claim or potential claim.

Litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may

harm the Company’s business.

There is no pending litigation involving the Company at this time.

to the nature of the businesses in which the Company is engaged, it is subject to certain risks.

Such risks include, among others, risk

of liability for personal injury or death to persons using products or services that the Company promotes or commercializes.

be no assurance that substantial claims or liabilities will not arise in the future due to the nature of the Company’s business

There is also the risk of employment related litigation and other litigation in the ordinary course of business.

Company could also be held liable for errors and omissions of its employees in connection with the services it performs that are outside

the scope of any indemnity or insurance policy.

The Company could be materially adversely affected if it were required to pay damages

or incur defense costs in connection with a claim that is outside the scope of an indemnification agreement;

if the indemnity, although

applicable, is not performed in accordance with its terms;

or if the Company’s liability exceeds the amount of applicable insurance

or indemnity.

Mezzanine Equity

From time to time, the Company may become

involved in various lawsuits and legal proceedings which arise in the ordinary course of business.

When the Company is aware of a claim

or potential claim, it assesses the likelihood of any loss or exposure.

If it is probable that a loss will result and the amount of the

loss can be reasonably estimated, the Company will record a liability for the loss.

In addition to the estimated loss, the recorded liability

includes probable and estimable legal costs associated with the claim or potential claim.

Litigation is subject to inherent uncertainties,

and an adverse result in these or other matters may arise from time to time that may harm the Company’s business.

There is no pending

litigation involving the Company at this time.

Due to the nature of the businesses in

which the Company is engaged, it is subject to certain risks.

Such risks include, among others, risk of liability for personal injury

or death to persons using products or services that the Company promotes or commercializes.

There can be no assurance that substantial

claims or liabilities will not arise in the future due to the nature of the Company’s business activities.

There is also the risk

of employment related litigation and other litigation in the ordinary course of business.

The Company could also be held liable

for errors and omissions of its employees in connection with the services it performs that are outside the scope of any indemnity or

insurance policy.

The Company could be materially adversely affected if it were required to pay damages or incur defense costs in connection

with a claim that is outside the scope of an indemnification agreement;

if the indemnity, although applicable, is not performed in accordance

with its terms;

or if the Company’s liability exceeds the amount of applicable insurance or indemnity.

Preferred Stock

January 10, 2020, the Company entered into a Securities Purchase and Exchange Agreement (the “Securities Purchase and Exchange

Agreement”) with 1315 Capital and Ampersand (collectively, the “Investors”) pursuant to which the Company agreed to

sell to the Investors an aggregate of $ 20.0 million in Series B Preferred Stock of the Company, at an issuance price per share of $ 1,000

(“New Investment Shares”).

Pursuant to the Securities Purchase and Exchange Agreement, 1315 Capital agreed to purchase 19,000

shares of Series B Preferred Stock at an aggregate purchase price of $ 19.0 million and Ampersand agreed to purchase 1,000 shares of Series

B Preferred Stock at an aggregate purchase price of $ 1.0 million.

addition, the Company agreed to exchange $ 27.0 million of the Company’s existing Series A convertible preferred stock, par value

$ 0.01 per share, held by Ampersand (the “Series A Preferred Stock”), represented by 270 shares of Series A Preferred Stock

with a stated value of $ 100,000 per share, which represents all of the Company’s issued and outstanding Series A Preferred Stock,

for 27,000 newly issued shares of Series B Preferred Stock (such shares of Series B Preferred Stock, the “Exchange Shares”

and such transaction, the “Exchange”).

Following the Exchange, no shares of Series A Preferred Stock remained designated,

authorized, issued or outstanding.

The Series B Preferred Stock has a conversion price of $ 6.00 .

any matter presented to the stockholders of the Company for their action or consideration at any meeting of stockholders of the Company

(or by written consent of stockholders in lieu of meeting), each holder of outstanding shares of Series B Preferred Stock will be entitled

to cast the number of votes equal to the number of whole shares of the Company’s common stock into which the shares of Series B

Preferred Stock held by such holder are convertible as of the record date for determining stockholders entitled to vote on such matter.

Except as provided by law or by the Certificate of Designation of Preferences, Rights and Limitations of Series B Convertible Preferred

Stock (the “Certificate of Designation”), holders of Series B Preferred Stock will vote together with the holders of common

stock as a single class and on an as-converted to common stock basis.

Designation Rights

Certificate of Designation also provides each Investor with the following director designation rights:

for so long such Investor holds

at least sixty percent (60%) of the Series B Preferred Stock issued to it on the Issuance Date (as defined therein), such Investor will

be entitled to elect two directors to the Company’s Board of Directors (the “Board”), provided that one of the directors

qualifies as an “independent director” under Rule 5605(a)(2) of the listing rules of the Nasdaq Stock Market (or any successor

rule or similar rule promulgated by another exchange on which the Company’s securities are then listed or designated) (“Independent

However, if at any time such Investor holds less than sixty percent (60%), but at least forty percent (40%), of the

Series B Preferred Stock issued to them on the Issuance Date, such Investor would only be entitled to elect one director to the Board.

Any director elected pursuant to the terms of the Certificate of Designation may be removed without cause by, and only by, the affirmative

vote of the holders of Series B Preferred Stock.

A vacancy in any directorship filled by the holders of Series B Preferred Stock may

be filled only by vote or written consent in lieu of a meeting of such holders of Series B Preferred Stock or by any remaining director

or directors elected by such holders of Series B Preferred Stock .

November 15, 2023, Edward Chan, a director designated by 1315 Capital to the Board, provided notice to the Company of his resignation

from the Board, effective immediately.

Further, on December 7, 2023, Robert Gorman, a director designated by Ampersand to the Board,

provided notice to the Company of his resignation as a director and as Chairman of the Board, effective immediately.

Certificate of Designation provides that from and after the Issuance Date and subject to the terms of the Certificate of Designation,

each share of Series B Preferred Stock is convertible, at any time and from time to time, at the option of the holder into a number of

shares of common stock equal to dividing the amount equal to the greater of the Stated Value of such Series B Preferred Stock, plus any

dividends declared but unpaid thereon, or such amount per share as would have been payable had each such share been converted into common

stock immediately prior to a liquidation, by six dollars ($ 6.00 ) (subject to adjustment in the event of any stock dividend, stock split,

combination, or other similar recapitalization affecting such shares).

The aggregate number of shares of common stock that may be issued

through conversion of all of the New Investment Shares and Exchange Shares is 7,833,334 shares (subject to appropriate adjustment in

Redeemable Preferred Stock

On January 10, 2020, the Company entered

into a Securities Purchase and Exchange Agreement (the “Securities Purchase and Exchange Agreement”) with 1315 Capital and

Ampersand (collectively, the “Investors”) pursuant to which the Company agreed to sell to the Investors an aggregate of $ 20.0

million in Series B Preferred Stock of the Company, at an issuance price per share of $ 1,000 (“New Investment Shares”).

to the Securities Purchase and Exchange Agreement, 1315 Capital agreed to purchase 19,000 shares of Series B Preferred Stock at an aggregate

purchase price of $ 19.0 million and Ampersand agreed to purchase 1,000 shares of Series B Preferred Stock at an aggregate purchase price

of $ 1.0 million.

In addition, the Company agreed to exchange

$ 27.0 million of the Company’s existing Series A convertible preferred stock, par value $ 0.01 per share, held by Ampersand (the

“Series A Preferred Stock”), represented by 270 shares of Series A Preferred Stock with a stated value of $ 100,000 per share,

which represents all of the Company’s issued and outstanding Series A Preferred Stock, for 27,000 newly issued shares of Series

B Preferred Stock (such shares of Series B Preferred Stock, the “Exchange Shares” and such transaction, the “Exchange”).

Following the Exchange, no shares of Series A Preferred Stock remained designated, authorized, issued or outstanding.

The Series B Preferred

Stock had a conversion price of $ 6.00 .

On October 10, 2024, the Company and the

Investors entered into an Exchange Agreement (the “Exchange Agreement”) pursuant to which the Investors exchanged (the “Exchange”)

an aggregate of 47,000 shares of the Company’s Series B Preferred Stock, comprised of 28,000 shares of Series B Preferred Stock

held by Ampersand and 19,000 shares of Series B Preferred Stock held by 1315 Capital, which represented all of the Company’s issued

and outstanding Series B Preferred Stock, for 47,000 newly created shares of Series C Preferred Stock, at an issuance price per share

In the Exchange, Ampersand received 28,000 shares of Series C Preferred Stock and 1315 received 19,000 shares of Series C

Preferred Stock.

The Company recorded approximately $ 0.2 million in issuance costs related to this transaction.

The Series C Preferred Stock is convertible

into the Company’s common stock at a conversion price of $ 2.02 per share of common stock (subject to further adjustment in the

event of any stock dividend, stock split, combination, or other similar recapitalization affecting such shares) which was the closing

price of the common stock on the date of the Exchange Agreement.

The Series C Preferred Stock does not have a liquidation preference

over the common stock in the event of a sale or dissolution of the Company, does not have director designation rights and includes limited

customary protective provisions.

The Series B Preferred Stock had a conversion price of $ 6.00 per share of common stock and included

additional protective provisions not applicable to the Series C Preferred Stock, including (i) limitations on the Board to declare dividends,

(ii) director designation rights for each of the Investors, (iii) liquidation rights of holders upon “deemed liquidation”

events, including a liquidation preference over the common stock, (iv) limitations on the ability to authorize, issue or create debt

securities, (v) limitations on the ability to enter into mergers or acquisitions and (vi) limitations on the ability to conduct public

offerings of the Company’s common stock.

On any matter presented to the stockholders

of the Company for their action or consideration at any meeting of stockholders of the Company (or by written consent of stockholders

in lieu of meeting), each holder of outstanding shares of Series C Preferred Stock will be entitled to cast the number of votes equal

to the number of whole shares of Common Stock, into which the shares of Series C Preferred Stock held by such holder are convertible

as of the record date for determining stockholders entitled to vote on such matter.

Except as provided by law or by the Certificate of

Designation, holders of Series C Preferred Stock will vote together with the holders of Common Stock as a single class and on an as-converted

to Common Stock basis.

Director Designation Rights

The Series C Preferred Stock does not

have director designation rights.

The Certificate of Designation provides

that from and after the Issuance Date and subject to the terms of the Certificate of Designation, each share of Series C Preferred Stock

is convertible, at any time and from time to time, at the option of the holder into a number of shares of Common Stock equal to the product

of the Series C Conversion Ratio (the “Series C Conversion Ratio”) and the number of shares of Series C Preferred Stock to

be converted.

The Series C Conversion Ratio is calculated by dividing the Stated Value per share of Series C Preferred Stock by the Series

C Conversion Price.

The Series C Conversion Ratio is subject to adjustment in the event of any stock dividend, stock split, combination,

or other similar recapitalization which results in the adjustment of the Series C Conversion Price.

The aggregate number of shares of Common

Stock that may be issued through conversion of all of the Exchange Shares is 23,267,326 shares (subject to appropriate adjustment in

the event of any stock dividend, stock split, combination or other similar recapitalization affecting such shares).

the Company consummates the sale of shares of common stock to the public in a firm-commitment underwritten public offering pursuant to

an effective registration statement under the Securities Act pursuant to which the price of the common stock in such offering is at least

equal to twelve dollars ($ 12.00 ) (subject to adjustment in the event of any stock dividend, stock split, combination, or other similar

recapitalization affecting such shares) and such offering does not include warrants (or any other convertible security) and results in

at least $ 25,000,000.00 in proceeds, net of the underwriting discount and commissions, to the Company, and the common stock continues

to be listed for trading on the Nasdaq Capital Market or another exchange, all outstanding shares of Series B Preferred Stock will automatically

be converted into shares of common stock, at the then effective Series B Conversion Ratio (as defined in the Certificate of Designation).

any voluntary or involuntary liquidation, dissolution or winding up of the Company or Deemed Liquidation (as defined in the Certificate

of Designation) (a “Liquidation”), the holders of shares of Series B Preferred Stock then outstanding will be entitled to

be paid out of the assets of the Company available for distribution to its stockholders (on a pari passu basis with the holders of any

class or series of preferred stock ranking on liquidation on a parity with the Series B Preferred Stock), and before any payment will

be made to the holders of common stock or any other class or series of preferred stock ranking on liquidation junior to the Series B

Preferred Stock by reason of their ownership thereof, an amount per share of Series B Preferred Stock equal to the greater of (i) the

Stated Value of such share of Series B Preferred Stock, plus any dividends declared but unpaid thereon, or (ii) such amount per share

as would have been payable had each such share been converted into common stock immediately prior to such Liquidation.

of December 31, 2023 and December 31, 2022, there were 47,000 Series B issued and outstanding shares of preferred stock, respectively.

Mandatory Conversion

Immediately prior to the Company’s

listing of Common Stock on The Nasdaq Stock Market, all outstanding shares of Series C Preferred Stock shall automatically convert into

a number of shares of Common Stock equal to the product of the Series C Conversion Ratio and the number of shares of Series C Preferred

Stock owned by each holder.

Upon any voluntary or involuntary liquidation,

dissolution or winding up of the Company, the holders of shares of Series C Preferred Stock then outstanding will be entitled to be paid

out of the assets of the Corporation available for distribution to its stockholders on a pari passu basis with the holders of the Common

Stock of the Company.

As of December 31, 2024, there were 47,000

Series C Preferred Stock issued and outstanding and as of December 31, 2023, there were 47,000 Series B Preferred Stock issued and outstanding.

Notes Payable

October 29, 2021, the Company and its subsidiaries entered into the BroadOak Loan Agreement, providing for a term loan in the aggregate

principal amount of $ 8,000,000 (the “Term Loan”).

Funding of the Term Loan took place on November 1, 2021.

The Term Loan

was scheduled to mature upon the earlier of (i) October 31, 2024 or (ii) the occurrence of a change in control, and bears interest at the rate of 9 %

The Term Loan is secured by a security interest in substantially all of the Company’s and its subsidiaries’ assets

and was subordinate to the Company’s $ 7,500,000 revolving credit facility with Comerica Bank.

BroadOak Loan

On October 29, 2021, the Company and its

subsidiaries entered into the Term Loan with BroadOak, providing for a term loan in the aggregate principal amount of $ 8,000,000 .

of the Term Loan took place on November 1, 2021.

The Term Loan was scheduled to mature upon the earlier of (i) October 31, 2024 or (ii)

the occurrence of a change in control, and bears interest at the rate of 9 % per annum.

The Term Loan is secured by a security interest

in substantially all of the Company’s and its subsidiaries’ assets and was subordinate to the Company’s $ 7,500,000

revolving credit facility with Comerica Bank.

See Note 19, Revolving Line of Credit .

The Term Loan had an origination fee of 3 % of the Term Loan amount, and a terminal payment equal to (i) 15% of the original principal

amount of the Term Loan if the change of control occurs on or prior to the first anniversary of the funding of the Term Loan, (ii) 20%

of the original principal amount of the Term Loan if the change of control occurs after the first anniversary but on or prior to the

second anniversary of the funding of the Term Loan and (iii) 30% of the original principal amount of the Term Loan if the change of control

occurs after the second anniversary of the funding of the Term Loan, or if the Term Loan is repaid on its maturity date .

BroadOak Loan Agreement contains affirmative and negative restrictive covenants that are applicable from and after the date of the Term

Loan advance.

These restrictive covenants, which include restrictions on certain mergers, acquisitions, investments, encumbrances, etc.,

could adversely affect our ability to conduct our business.

The BroadOak Loan Agreement also contains customary events of default.

connection with the BroadOak Loan Agreement, the Company and its subsidiaries entered into that certain First Amendment to Loan and Security

Agreement and Consent with Comerica, dated as of November 1, 2021 (the “Comerica Amendment”), pursuant to which Comerica

consented to the Company’s and its subsidiaries’ entry into the BroadOak Loan Agreement, and amended that certain Loan and

Security Agreement among Comerica, the Company and its subsidiaries (the “Comerica Loan Agreement”) to, among other things,

permit the indebtedness, liens and encumbrances contemplated by the BroadOak Loan Agreement.

a condition for BroadOak to extend the Term Loan to the Company and its subsidiaries, the Company’s existing creditor, Comerica,

and BroadOak entered into that certain Subordination and Intercreditor Agreement, dated as of November 1, 2021, pursuant to which BroadOak

agreed to subordinate all of the indebtedness and obligations of the Company and its subsidiaries owing to BroadOak to all of the indebtedness

and obligations of the Company and its subsidiaries owing to Comerica (the “Intercreditor Agreement”).

BroadOak further agreed

to subordinate all of its respective security interests in assets or property of the Company and its subsidiaries to Comerica’s

security interests in such assets or property.

The Intercreditor Agreement provides that it is solely for the benefit of BroadOak and

Comerica and is not for the benefit of the Company or any of its subsidiaries.

Company concluded that the Note met the definition of a “recognized financial liability” which is an acceptable financial

instrument eligible for the fair value option under ASC 825-10-15-4, and did not meet the definition of any of the financial instruments

listed within ASC 825-10-15-5 that are not eligible for the fair value option.

The Note is not convertible and does not have any component

recorded to shareholders’ equity.

The Term Loan had an origination fee of 3 %

of the Term Loan amount, and a terminal payment equal to (i) 15% of the original principal amount of the Term Loan if the change of control

occurs on or prior to the first anniversary of the funding of the Term Loan, (ii) 20% of the original principal amount of the Term Loan

if the change of control occurs after the first anniversary but on or prior to the second anniversary of the funding of the Term Loan

and (iii) 30% of the original principal amount of the Term Loan if the change of control occurs after the second anniversary of the funding

of the Term Loan, or if the Term Loan is repaid on its maturity date.

The Term Loan contains affirmative and

negative restrictive covenants that are applicable from and after the date of the Term Loan advance.

These restrictive covenants, which

include restrictions on certain mergers, acquisitions, investments, encumbrances, etc., could adversely affect our ability to conduct

our business.

The Term Loan also contains customary events of default.

The Company concluded that the Term Loan

met the definition of a “recognized financial liability” which is an acceptable financial instrument eligible for the fair

value option under ASC 825-10-15-4, and did not meet the definition of any of the financial instruments listed within ASC 825-10-15-5

that are not eligible for the fair value option.

The Note is not convertible and does not have any component recorded to stockholders’

Accordingly, the Company elected the fair value option for the Note.

October 24, 2023, the Company entered into a Second Amendment to Loan and Security Agreement (“Amendment”) with BroadOak.

The primary changes to the original BroadOak Loan Agreement were as follows:

Company made a one-time payment in an aggregate amount equal to $ 2,500,000 , on October 30, 2023 and applied the payment in full satisfaction

of the $ 3,000,000 Terminal Payment (as defined in the BroadOak Loan Agreement).

In May 2022, the Company issued a convertible

note to BroadOak, pursuant to which BroadOak funded a term loan in the aggregate principal amount of $ 2.0 million, which was converted

into a subordinated term loan and was added to the outstanding balance of the Term Loan.

On October 24, 2023, the Company entered

into a Second Amendment to Loan and Security Agreement (the “Second Amendment”) with BroadOak.

The primary changes to the

original Term Loan were as follows:

● The Company made a one-time payment

in an aggregate amount equal to $ 2,500,000 , on October 30, 2023 and applied the payment in full satisfaction of the $ 3,000,000 Terminal

Payment (as defined in the Term Loan).

See above regarding the Terminal Payment.

November 1, 2023, the interest rate under the BroadOak Loan Agreement was reduced from 9 % to 8 % through the maturity date of October

31, 2024 or earlier, upon the occurrence of a change in control (“Loan Maturity Date”).

Company has the option to request an extension of the Loan Maturity Date in writing no less than sixty days prior to the Loan Maturity

If BroadOak agrees to the extension, the Loan Maturity Date would automatically be extended.

The Second Amendment was treated as a debt

Effective November 1, 2023, the interest rate

under the Term Loan was reduced from 9 % to 8 % through the maturity date of October 31, 2024 or earlier, upon the occurrence of a

change in control (“Loan Maturity Date”).

The Company had the option to request an extension

of the Loan Maturity Date in writing no less than sixty days prior to the Loan Maturity Date.

If BroadOak agreed to the extension,

the Loan Maturity Date would automatically be extended.

The Second Amendment was treated as a

debt modification which is accounted for prospectively.

Since the Term Loan is carried at fair value under the fair value option, the

Second Amendment did not result in any extinguishment gain or loss upon amendment, and the impact of the revised terms was incorporated

into the Company’s fourth quarter 2023 fair value calculation.

On March 29, 2024, the Company entered

into a Third Amendment to Loan and Security Agreement with BroadOak (the “Third Amendment”).

The primary changes to the Second

Amendment were as follows:

The maturity date was extended to June 30, 2025.

Beginning April 1, 2024, the Company made $ 500,000

monthly payments with the remaining loan balance due on the new maturity date.

The Third Amendment was treated as a debt

modification which is accounted for prospectively.

Since the BroadOak Loan is carried at fair value under the fair value option, the Second

Since the Term Loan is carried at fair value under the fair value option, the Third

Amendment did not result in any extinguishment gain or loss upon amendment, and the impact of the revised terms was incorporated into

the Company’s fourth quarter 2023 fair value calculation.

March 2024, the Company entered into a Third Amendment of the BroadOak Loan Agreement.

See Note 20, Subsequent Events , for more

the Company’s first quarter 2024 fair value calculation.

The balance of the loan outstanding

at December 31, 2024 was $ 4.4 million.

In January 2025, the Company entered into

a Fourth Amendment of the Term Loan.

See Note 21, Subsequent Events , for more details.

Stock-Based Compensation

Company’s stock-incentive program is a long-term retention program that is intended to attract, retain and provide incentives for

talented employees, officers and directors, and to align stockholder and employee interests.

Currently, the Company is able to grant

options, stock appreciation rights (“SARs”) and restricted shares from the Interpace Biosciences, Inc.

2019 Equity Incentive

No new grants may be made under the Company’s prior stock incentive plan, the Interpace Diagnostics Group, Inc.

as Interpace Biosciences, Inc.) Amended and Restated 2004 Stock Award and Incentive Plan (the “2004 Plan”).

Unless earlier

terminated by action of the Company’s board of directors, the 2004 Plan will remain in effect until such time as no stock remains

available for delivery and the Company has no further rights or obligations under the 2004 Plan with respect to outstanding awards thereunder.

Historically,

stock options have been granted with an exercise price equal to the market value of the common stock on the date of grant, expire 10

years from the date they are granted, and generally vested over a one to three-year period for employees and members of the Board.

exercise, new shares will be issued by the Company.

The restricted shares and restricted stock units (“RSUs”) granted to

employees generally have a three-year graded vesting period and are subject to accelerated vesting and forfeiture under certain circumstances.

Restricted shares and RSUs granted to Board members generally have a three-year graded vesting period and are subject to accelerated

vesting and forfeiture under certain circumstances.

Company primarily uses the Black-Scholes option-pricing model to determine the fair value of stock options.

The determination of the

fair value of stock-based payment awards on the date of grant using an option-pricing model is affected by the Company’s stock

price as well as assumptions regarding a number of complex and subjective variables.

These variables include the Company’s expected

stock price volatility over the term of the awards, actual and projected employee stock option exercise behaviors, risk-free interest

rate and expected dividends.

Expected volatility is based on historical volatility.

As there is no trading volume for the Company’s

options, implied volatility is not representative of the Company’s current volatility so the historical volatility of the Company’s

common stock is determined to be more indicative of the Company’s expected future stock performance.

The expected life is determined

using the safe-harbor method.

The Company expects to use this simplified method for valuing employee options until more detailed information

about exercise behavior becomes available over time.

The Company’s stock-incentive program

is a long-term retention program that is intended to attract, retain and provide incentives for talented employees, officers and directors,

and to align stockholder and employee interests.

Currently, the Company is able to grant options, stock appreciation rights (“SARs”)

and restricted shares from the Interpace Biosciences, Inc.

2019 Equity Incentive Plan.

No new grants may be made under the Company’s

prior stock incentive plan, the Interpace Diagnostics Group, Inc.

(now known as Interpace Biosciences, Inc.) Amended and Restated 2004

Stock Award and Incentive Plan (the “2004 Plan”).

Unless earlier terminated by action of the Company’s board of directors,

the 2004 Plan will remain in effect until such time as no stock remains available for delivery and the Company has no further rights

or obligations under the 2004 Plan with respect to outstanding awards thereunder.

Historically, stock options have been

granted with an exercise price equal to the market value of the common stock on the date of grant, expire 10 years from the date they

are granted, and generally vested over a one to three-year period for employees and members of the Board.

Upon exercise, new shares will

be issued by the Company.

The restricted shares and restricted stock units (“RSUs”) granted to employees generally have a

three-year graded vesting period and are subject to accelerated vesting and forfeiture under certain circumstances.

Restricted shares

and RSUs granted to Board members generally have a three-year graded vesting period and are subject to accelerated vesting and forfeiture

under certain circumstances.

The Company primarily uses the Black-Scholes

option-pricing model to determine the fair value of stock options.

The determination of the fair value of stock-based payment awards

on the date of grant using an option-pricing model is affected by the Company’s stock price as well as assumptions regarding a

number of complex and subjective variables.

These variables include the Company’s expected stock price volatility over the term

of the awards, actual and projected employee stock option exercise behaviors, risk-free interest rate and expected dividends.

volatility is based on historical volatility.

As there is no trading volume for the Company’s options, implied volatility is not

representative of the Company’s current volatility so the historical volatility of the Company’s common stock is determined

to be more indicative of the Company’s expected future stock performance.

The expected life is determined using the safe-harbor

The Company expects to use this simplified method for valuing employee options until more detailed information about exercise

behavior becomes available over time.

The Company bases the risk-free interest rate on U.S.

Treasury zero-coupon issues

with remaining terms similar to the expected term on the options.

The Company does not anticipate paying any cash dividends in the foreseeable

future and therefore uses an expected dividend yield of zero in the option valuation model.

The Company estimates forfeitures at the

time of grant and revise those estimates in subsequent periods if actual forfeitures differ from those estimates.

Treasury zero-coupon issues with remaining

terms similar to the expected term on the options.

The Company does not anticipate paying any cash dividends in the foreseeable future

and therefore uses an expected dividend yield of zero in the option valuation model.

The Company estimates forfeitures at the time of

grant and revise those estimates in subsequent periods if actual forfeitures differ from those estimates.

The Company uses historical

2 unchanged sentences

basis over the vesting period of the grant.

Company began an employee stock purchase plan in 2020 and recognized approximately $ 46,000 in expense related to that plan for the year

ended December 31, 2022.

The Company suspended its plan in July 2022 as there were no shares available in the original authorized shares

In November 2022, the shareholders approved an increase to the pool of an additional one million shares.

of December 31, 2023, we have reserved 692,688 shares of our common stock for issuance under our 2019 Equity Incentive Plan, 1,000,007

shares of our common stock for issuance under our Employee Stock Purchase Plan and 1,677,248 additional shares available for future grants

of awards under our 2019 Equity Incentive Plan.

estimated compensation cost associated with the granting of restricted stock and restricted stock units is based on the fair value of

the Company’s common stock on the date of grant.

The Company recognizes the compensation cost, net of estimated forfeitures, arising

from the issuance of restricted stock and restricted stock units on a straight-line basis over the shorter of the vesting period or the

period from the grant date to the date when retirement eligibility is achieved.

were no stock options granted in 2023.

The following table provides the weighted average assumptions used in determining the fair value

of the stock options granted during the year ended December 31, 2022:

of Stock Options, Valuation Assumptions

interest rate

weighted-average fair value of stock options granted during the year ended December 31, 2022 was estimated to be $ 4.50 .

There were no

options exercised in 2023 or 2022.

compensation from continuing operations for the years ended December 31, 2023 and 2022 is as follows:

The Company began an employee stock purchase

plan in 2020.

The Company suspended its plan in July 2022 as there were no shares available in the original authorized shares pool.

November 2022, the shareholders approved an increase to the pool of an additional one million shares.

As of December 31, 2024, the Company has

reserved 481,494 shares of its common stock for issuance under our 2019 Equity Incentive Plan, 1,000,007 shares of its common stock for

issuance under our Employee Stock Purchase Plan and 1,796,268 additional shares available for future grants of awards under its 2019

Equity Incentive Plan.

The estimated compensation cost associated

with the granting of restricted stock and restricted stock units is based on the fair value of the Company’s common stock on the

date of grant.

The Company recognizes the compensation cost, net of estimated forfeitures, arising from the issuance of restricted stock

and restricted stock units on a straight-line basis over the shorter of the vesting period or the period from the grant date to the date

when retirement eligibility is achieved.

There were no stock options granted in

2024 or 2023.

There were no options exercised in 2024 or 2023.

Stock-based compensation from continuing

operations for the years ended December 31, 2024 and 2023 is as follows:

of Share-Based Compensation Arrangements by Share-Based Payment Award

and restricted stock

Performance-based

stock-based compensation expense

summary of stock option activity for the year ended December 31, 2023, and changes during such year, is presented below:

RSUs and restricted stock

Performance-based awards

Total stock-based compensation expense

A summary of stock option activity for

the year ended December 31, 2024, and changes during such year, is presented below:

of Stock Option Activity

Weighted-Average

at January 1, 2023

at December 31, 2023

and expected to vest

summary of the change in of the Company’s non-vested options for the year ended December 31, 2023 is presented below:

Period (in years)

Outstanding at January 1, 2024

Forfeited or expired

Outstanding at December 31, 2024

Exercisable at December 31, 2024

Vested and expected to vest

A summary of the change in of the Company’s

non-vested options for the year ended December 31, 2024 is presented below:

of Non Vested Option Activity

Average Grant Date Fair Value

at January 1, 2023

at December 31, 2023

aggregate fair value of options vested during the years ended December 31, 2023 and 2022 was $ 0.6 million and $ 0.7 million, respectively.

The weighted-average grant date fair value of options vested during the year ended December 31, 2022 was $ 5.02 .

summary of the Company’s non-vested shares of restricted stock and restricted stock units for the year ended December 31, 2023,

and changes during such year, is presented below:

Weighted- Average Grant Date Fair Value

Nonvested at January 1, 2024

Nonvested at December 31, 2024

The aggregate fair value of options vested

during the years ended December 31, 2024 and 2023 was $ 0.1 million and $ 0.6 million, respectively.

The weighted-average grant date fair

value of options vested during the year ended December 31, 2023 was $ 4.70 .

A summary of the Company’s non-vested

shares of restricted stock and restricted stock units for the year ended December 31, 2023, and changes during such year, is presented

of Share-Based Compensation, Restricted Stock and Restricted Stock Units Activity

at January 1, 2023

at December 31, 2023

aggregate fair value of restricted stock units vested during each of the years ended December 31, 2023 and 2022 was $ 0.3 million and

$ 0.6 million, respectively.

of December 31, 2023, there was approximately $ 0.3 million of total unrecognized compensation cost, net of estimated forfeitures, related

to unvested stock options and restricted stock units which will be expensed over the next three years.

Period (in years)

Nonvested at January 1, 2024

Nonvested at December 31, 2024

The aggregate fair value of restricted

stock units vested during each of the years ended December 31, 2024 and 2023 was $ 0.2 million and $ 0.3 million, respectively.

As of December 31, 2024, there was approximately

$ 0.1 million of total unrecognized compensation cost, net of estimated forfeitures, related to unvested stock options and restricted

stock units which will be expensed over the next three years.

The Company operates and manages its business

as a single reporting segment.

The business provides esoteric molecular diagnostic testing, and pathology services to aid physicians

in their evaluation of cancer risk in patients with indeterminate biopsies and a perceived high risk of cancer from clinical features.

We develop and commercialize genomic tests and related first-line assays that can personalize medicine to help improve patient diagnosis

and management.

The Company’s chief operating decision maker (“CODM”) is the chief executive officer.

The CODM assesses performance for the

segment and decides how to allocate resources based on consolidated net income that is also reported on the consolidated statements of

The monitoring of budgeted versus actual results is used in assessing performance of the segment and in establishing resource

allocation across the organization.

The measure of segment assets is reported

on the consolidated balance sheet as total consolidated assets.

All the Company’s long-lived assets are located in the United States.

The accounting policies of the segment are the same as those described in Note 1, Nature of Business and Significant Accounting Policies

included in this Annual Report on Form 10-K.

The following table presents reportable

segment profit and loss, including significant expense categories, attributable to the Company’s reportable segment for the periods

of Reconciliation of Profit (Loss) from Segments to Consolidated

For The Years

Ended December 31,

(as restated)

Revenue, net:

Cost of revenue:

Sales and marketing

Research and development

General and administrative

Other operating expenses

Interest & other expense, net

Provision for income taxes

Segment net income

Reconciliation of profit or loss:

Loss on discontinued operations

Consolidated net income

Adjusted EBITDA, a non-GAAP

financial measure, is a metric used by the CODM to measure cash flow of the ongoing business.

Adjusted EBITDA is defined as income or

loss from continuing operations, plus depreciation and amortization, non-cash stock-based compensation, interest and taxes, and other

non-cash expenses including asset impairment costs, change in fair value of contingent consideration, and change in fair value of notes

The table below includes a reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial

Reconciliation of Adjusted EBITDA (Unaudited)

($ in thousands)

of Reconciliation of Adjusted EBITDA

(as restated)

Income from continuing operations (GAAP Basis)

Depreciation and amortization

Stock-based compensation

Interest accretion expense

Financing interest and related costs

Interest income

Change in fair value of note payable

Change in fair value of contingent consideration

Adjusted EBITDA

Revenue Sources

Company’s clinical services customers consist primarily of physicians, hospitals and clinics.

Its revenue channels include Medicare,

Medicare Advantage, Medicaid, Client Billings (hospitals, etc.), and commercial payers.

The following sets forth the net revenue generated

by revenue channel accounting for more than 10% of the Company’s revenue from continuing operations during the years ended December

31, 2023 and 2022, respectively.

The Company’s clinical services

customers consist primarily of physicians, hospitals and clinics.

Its revenue channels include Medicare, Medicare Advantage, Medicaid,

Client Billings (hospitals, etc.), and commercial payers.

The following sets forth the net revenue generated by revenue channel accounting

for more than 10% of the Company’s revenue from continuing operations during the years ended December 31, 2024 and 2023, respectively.

For the years ended December 31, 2024 and December 31, 2023, revenue from Medicare was approximately 36 %

37 % and 45 % of total revenue, respectively.

of total revenue, respectively.

of Revenue by Major Customers

Ended December 31,

provision for income taxes on continuing operations for the years ended December 31, 2023 and 2022 is comprised of the following:

Years Ended December 31,

(as restated)

Commercial Payors

Client Billings

Medicare Advantage

The provision for income taxes on continuing

operations for the years ended December 31, 2024 and 2023 is comprised of the following:

of Components of Income Tax Expense (Benefit)

for income taxes

Company performs an analysis each year to determine whether the expected future income will more likely than not be sufficient to realize

the deferred tax assets.

The Company’s recent operating results and projections of future income weighed heavily in the Company’s

overall assessment.

As a result of this analysis, the Company continues to maintain a full valuation allowance against its federal and

state net deferred tax assets at December 31, 2023 as the Company believes that it is more likely than not that these assets will not

tax effects of significant items comprising the Company’s deferred tax assets and (liabilities) as of December 31, 2023 and 2022

are as follows:

Total current

Total deferred

Provision for income taxes

The Company performs an analysis each

year to determine whether the expected future income will more likely than not be sufficient to realize the deferred tax assets.

Company’s recent operating results and projections of future income weighed heavily in the Company’s overall assessment.

As a result of this analysis, the Company continues to maintain a full valuation allowance against its federal and state net deferred

tax assets at December 31, 2024 as the Company believes that it is more likely than not that these assets will not be realized.

The tax effects of significant items comprising

the Company’s deferred tax assets and (liabilities) as of December 31, 2024 and 2023 are as follows:

of Deferred Tax Assets and Liabilities

net operating loss carryforwards

(as restated)

Deferred tax assets:

Federal net operating loss carryforwards

State net operating loss carryforwards

Allowances and reserves

Intangible assets

Credit carryforward

163(j) interest

Deferred revenue

Capitalized 174

Valuation allowance

Gross deferred tax assets

tax liability:

and equipment

tax liability-net valuation allowance

Company’s deferred tax asset and deferred tax liabilities are included within Other long-term liabilities , within the consolidated

balance sheet as of December 31, 2023 and 2022.

Federal tax attribute carryforwards at December 31, 2023, consist primarily of approximately

$ 125.8 million of federal net operating losses.

In addition, the Company has approximately $ 60.8 million of state net operating losses

carryforwards post 382 ownership change.

The utilization of the federal carryforwards as an available offset to future taxable income

is subject to limitations under federal income tax laws.

Under current federal income tax law, federal NOLs incurred in tax years beginning

after December 31, 2017 may be carried forward indefinitely, but the deductibility of such federal NOLs is limited to 80% of Federal

Taxable Income, and current state net operating losses not utilized begin to expire this year.

NOL carry forwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities.

tax credit carry forwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership

interest of significant stockholders over a three-year period in excess of 50%, as defined under Sections 382 and 383 of the

Internal Revenue Code of 1986, as amended, or the Code, as well as similar state tax provisions.

The amount of the annual

limitation, if any, will be determined based on the value of our company immediately prior to an ownership change.

ownership changes may further affect the limitation in future years.

Additionally, U.S.

tax laws limit the time during which these

carry forwards may be applied against future taxes, therefore, we may not be able to take full advantage of these carry forwards for

federal income tax purposes.

During 2021, the Company completed a 382 assessment of the available NOLs under Section 382 and

determined that the Company underwent an ownership change on March 30, 2017 and July 15, 2019 and as a result, NOLs attributable to

the pre-ownership change are subject to a substantial annual limitation under Section 382 of the Internal Revenue Code due to the

multiple ownership changes.

The Company has adjusted their NOL carryforwards to address the impact of the 382 ownership change.

Federal Net Operating Losses of $ 71.2

million are subject to annual limitation for ownership changes and the Company is utilizing $ 1.0

million during the current year.

The remaining $ 55.6

million of NOLs incurred post July 15, 2019 are not subject to any annual limitation and can be carried forward

indefinitely.

reconciliation of the difference between the federal statutory tax rates and the Company’s effective tax rate from continuing operations

is as follows:

Deferred tax liability:

Property and equipment

Deferred tax liability-net valuation allowance

The Company’s deferred tax

asset and deferred tax liabilities as of both December 31, 2024 and 2023 periods was $ 0 as they are fully offset by a valuation

The NOL carry forwards are subject to review and possible adjustment by the Internal Revenue Service and state tax

During 2021, the Company completed a Section 382 analysis of the available NOLs under Section 382 of the Internal

Revenue Code and determined that the Company underwent an ownership change on March 30, 2017 and July 15, 2019.

As a result, NOLs

attributable to the pre-ownership change are subject to a substantial annual limitation under Section 382.

The Company has

approximately $ 115.0

million of federal net operating losses after adjusting for the impact of the Section 382 ownership change.

Federal Net Operating

Losses of $ 66.5 million are subject to annual limitation for ownership changes and the Company is utilizing $ 4.0 million of the

available amount during the current year.

The remaining $ 52.5 million of NOLs incurred post July 15, 2019 may be subject to an

annual limitation in the event of certain cumulative changes in the ownership interest of significant stockholders over a three-year

These NOLs can be carried forward indefinitely, but the deductibility of such federal NOLs are limited to 80% of Federal

Taxable Income.

The Company has approximately $ 55.1

million of state net operating losses carryforwards after adjusting for the impact of the Section 382 ownership change.

state net operating losses not utilized begin to expire this year.

A reconciliation of the difference between

the federal statutory tax rates and the Company’s effective tax rate from continuing operations is as follows:

of Effective Income Tax Rate Reconciliation

statutory rate

income tax rate, net of Federal tax benefit

and entertainment

following table summarizes the change in uncertain tax benefit reserves for the two years ended December 31, 2023:

(as restated)

Federal statutory rate

State income tax rate, net of Federal tax benefit

Meals and entertainment

Valuation allowance

Effective tax rate

The following table summarizes the change

in uncertain tax benefit reserves for the two years ended December 31, 2024:

of Unrecognized Tax Benefits Reserves Roll Forward

of unrecognized benefits as of January 1, 2022

for tax positions of prior years

as of January 1, 2023

for tax positions of prior years

as of December 31, 2023

of both December 31, 2023 and 2022, the total amount of gross unrecognized tax benefits was $ 0.9 million.

The total amount of unrecognized

tax benefits that, if recognized, would affect the effective tax rate as of both December 31, 2023 and 2022 was $ 0.9 million.

Company recognized interest and penalties of $ 0.2 million related to uncertain tax positions in income tax expense during each of the

years ended December 31, 2023 and 2022.

At December 31, 2023 and 2022, accrued interest and penalties, net were $ 4.0 million and $ 3.8

Balance of unrecognized benefits as of January 1, 2023

Additions for tax positions of prior years

Balance as of December 31, 2023

Additions for tax positions of prior years

Balance as of December 31, 2024

As of both December 31, 2024 and 2023,

the total amount of gross unrecognized tax benefits was $ 0.9 million.

The total amount of unrecognized tax benefits that, if recognized,

would affect the effective tax rate as of both December 31, 2024 and 2023 was $ 0.9 million.

The Company recognized interest and

penalties of $ 0.4

million, and a release of $ 0.2

million related to uncertain tax positions in income tax expense during the year ended December 31, 2024.

The Company recognized

interest and penalties of $ 0.2 million, and there was no release related to uncertain tax positions in income tax expense during the

year ended December 31, 2023.

At December 31, 2024 and 2023, accrued interest and penalties, net were $ 4.2

million and $ 4.0

million, respectively, and are included in the Other long-term liabilities in the consolidated balance sheets.

Company and its subsidiaries file a U.S.

Federal consolidated income tax return and consolidated and separate income tax returns in numerous

states and local tax jurisdictions.

The Company and its subsidiaries file

Federal consolidated income tax return and consolidated and separate income tax returns in numerous states and local tax jurisdictions.

The following tax years remain subject to examination as of December 31, 2024:

of Tax Years Subject to Examination

the extent there was a failure to file a tax return in a previous year;

the statute of limitation will not begin until the return is

There were no examinations in process by the Internal Revenue Service as of December 31, 2023.

State and Local

To the extent there was a failure to file

a tax return in a previous year;

the statute of limitation will not begin until the return is filed.

There were no examinations in process

by the Internal Revenue Service as of December 31, 2024.

Basic and Diluted Net Income (Loss) per Share

reconciliation of the number of shares used in the calculation of basic and diluted earnings per share for the years ended December 31,

2023 and 2022 are as follows (rounded to thousands):

of Weighted Average Number of Shares

Ended December 31,

weighted average number of common shares

dilutive effect of stock-based awards

weighted average number of common shares

Company’s Series B Preferred Stock, on an as converted basis of 7,833,334 shares and the following outstanding stock-based awards

were excluded from the computation of the effect of dilutive securities on loss per share for the following periods as they would have

been anti-dilutive (rounded to thousands):

A reconciliation of the number of shares

used in the calculation of basic and diluted earnings per share for the years ended December 31, 2024 and 2023 are as follows (rounded

to thousands):

of Basic and Diluted Net Loss Per Share

Years Ended December 31,

Basic weighted average number of common shares

Potential dilutive effect of stock-based awards

Dilutive effect of preferred stock

Diluted weighted average number of common shares

The following outstanding stock-based

awards were excluded from the computation of the effect of dilutive securities on income per share for the following periods as they

would have been anti-dilutive (rounded to thousands):

of Anti-dilutive Securities Excluded from Computation of Earnings Per Share

Ended December 31,

stock units (RSUs)

Years Ended December 31,

Restricted stock units (RSUs)

Anti-dilutive

Revolving Line of Credit

October 13, 2021, the Company and its subsidiaries entered into the Comerica Loan Agreement with Comerica, providing for a revolving

credit facility of up to $ 7,500,000 (the “Credit Facility”).

The Company may use the proceeds of the Credit Facility for

working capital and other general corporate purposes.

amount that may be borrowed under the Credit Facility is the lower of (i) the revolving limit of $ 7,500,000 (the “Revolving Line”)

and (ii) 80 % of the Company’s eligible accounts receivable plus an applicable non-formula amount consisting of $ 2,000,000 of additional

availability at close not based upon the Company’s eligible accounts receivable, with such additional availability reducing by

$ 250,000 per quarter beginning with the quarter ending June 30, 2022.

Borrowings on the Credit Facility are limited to $ 5,000,000 until

80 % of the Company’s and its subsidiaries’ customers are paying into a collection account or segregated governmental account

with Comerica.

The Revolving Line can also include, at the Company’s option, credit card services with a sublimit of $ 300,000 .

Borrowings on the Revolving Line are subject to an interest rate equal to prime plus 0.50 %, with prime being the greater of (x) Comerica’s

stated prime rate or (y) the sum of (A) the daily adjusting LIBOR rate plus (B) 2.5 % per annum.

The Company is also required to pay an

unused facility fee quarterly in arrears in an amount equal to 0.25 % per annum on the average unused but available portion of the Revolving

Line for such quarter.

April 2022, Comerica waived certain covenants specifically relating to the Company receiving financial statements with a going concern

comment or qualification.

In April 2022 and August 2022, Comerica waived certain covenants specifically relating to failure to maintain

bank accounts outside of Comerica in an aggregate amount not to exceed $ 0.5 million during the transition period.

Additionally, in August

2022, Comerica waived certain covenants relating to failure to segregate collections made from government account debtors from collections

made from all other account debtors and customers.

Comerica Loan Agreement contains affirmative and negative restrictive covenants that are applicable whether or not any amounts are outstanding

under the Comerica Loan Agreement.

These restrictive covenants, which include restrictions on certain mergers, acquisitions, investments,

encumbrances, etc., could adversely affect our ability to conduct our business.

The Comerica Loan Agreement also contained financial

covenants requiring specified minimum liquidity and minimum revenue thresholds, which the Company was in compliance with as of December

31, 2023, and also contained customary events of default.

As of December 31, 2023, the balance

of the revolving line was zero .

October 6, 2023, effective September 30, 2023, the Company entered into a Fifth Amendment to its Loan and Security Agreement (the “Fifth

Amendment to the Comerica Loan Agreement”) with Comerica Bank providing for a revolving credit facility of up to $ 5,000,000 .

agreement was originally scheduled to expire on September 30, 2024 but has since been terminated.

The Company could have used the proceeds of

the Credit Facility for working capital and other general corporate purposes.

The amount that could have been borrowed under the Credit Facility

was the lower of (i) the revolving limit of $ 5,000,000 and (ii) 80 % of the Company’s eligible accounts receivable plus up to but

not exceeding $ 1.5 million in the Company’s Medicare accounts (excluding Medicare Advantage thyroid accounts).

Borrowings on the

Revolving Line were subject to an interest rate equal to the Term Secured Overnight Financing Rate (“SOFR”) Screen Rate plus

one-tenth of one percent.

Fifth Amendment to the Comerica Loan Agreement contained affirmative and negative restrictive covenants that were applicable whether

or not any amounts are outstanding under the Comerica Loan Agreement.

These restrictive covenants, which included restrictions on

certain mergers, acquisitions, investments, encumbrances, etc., could have adversely affected our ability to conduct our business.

Comerica Loan Agreement also contained financial covenants requiring specified minimum liquidity and minimum adjusted EBITDA

Pursuant to the Fifth Amendment to the Comerica Loan Agreement, Comerica consented to waive a covenant constituting an

event of default under the Comerica Loan Agreement regarding a going concern qualification issued in connection with the

Company’s 2022 fiscal year audit.

Note 20, Subsequent Events, for updates on the current status of the Comerica line.

On October 13, 2021, the Company and its

subsidiaries entered into the Comerica Loan Agreement with Comerica, providing for a revolving credit facility of up to $ 7,500,000 (the

“Credit Facility”).

The Company could use the proceeds of the Credit Facility for working capital and other general corporate

On October 6, 2023, effective September

30, 2023, the Company entered into a Fifth Amendment to its Loan and Security Agreement (the “Fifth Amendment to the Comerica Loan

Agreement”) with Comerica providing for a revolving credit facility of up to $ 5,000,000 .

In February 2024, the Company terminated

the Comerica Loan Agreement.

The Company did not owe anything outstanding on the line of credit at the time of termination and does not

owe anything further to Comerica.

Supplemental Cash Flow Information

Disclosure of Other Cash Flow Information

Supplemental Disclosure of Other Cash Flow Information

(in thousands)

Cash Flow Information

paid for taxes

paid for interest

Disclosures of Non Cash Activities

of property and equipment included in accounts payable

of convertible debt into notes payable

Cash paid for taxes

Cash paid for interest

Supplemental Disclosures of Non Cash Activities

(in thousands)

Purchase of property and equipment included in accounts payable

Lease remeasurement

Conversion of preferred shares from Series B to Series C

Subsequent Events

February 2024, the Company ended the Comerica Loan Agreement.

The Company did not owe anything outstanding on the Line at the time of

termination and does not owe anything further to Comerica Bank.

On January 9, 2025, the Company

announced the new LCD established non-coverage for its PancraGEN ® test, and it would stop offering the test and would

not accept specimens for first-line fluid chemistry and PancraGEN ® testing after February 7, 2025.

As a result of the

established non-coverage for PancraGEN ® , the Company announced that its board of directors had approved a restructuring

and cost-savings plan to reduce operating costs and better align the Company workforce with the loss of PancraGEN ® .

On January 27, 2025, the Company

announced that CMS had directed its Medicare Administrative Contractors, Novitas and First Coast Service Options, Inc., to delay implementation

of the Genetic Testing for Oncology LCD (L39365), from February 23, 2025 until April 24, 2025.

The Company stated that this change of

effective date will allow the Trump administration time to fully review the proposed policy changes, re-evaluate for themselves the supporting

clinical evidence for the PancraGEN ® assay, and fully assess the negative impact on patient care if the currently

proposed LCD comes into effect.

BroadOak Amendment

On March 29, 2024, the Company entered into a Third Amendment to Loan and Security Agreement with BroadOak.

changes to the Second Amendment to Loan and Security Agreement were as follows:

The maturity date was extended to June 30, 2025 .

Beginning April 1, 2024, the Company will make $ 500,000 monthly payments with the remaining loan balance due on the new maturity date.

On January 14, 2025, the Company

entered into a Fourth Amendment to the Loan and Security Agreement with BroadOak, extending the loan maturity date to December 31, 2025.

The primary changes to the Third Amendment were as follows:

The maturity date was extended to December 31, 2025.

Beginning July 1, 2025, and continuing through December 1, 2025, the

Company will make monthly interest-only payments with the remaining loan balance due on the new maturity date.

Restatement of Unaudited Quarterly Results

The financial results data,

presented on a quarterly basis for the years ended December 31, 2024 and 2023 are unaudited.

This data has been prepared in accordance

GAAP for interim financial information and, in the opinion of management, reflect all adjustments necessary for a fair statement

of the results of operations for the periods presented.

We have restated herein our

previously issued unaudited quarterly financial results for the quarters ended March 31, 2024 and 2023, June 30, 2024 and 2023 and September

30, 2024 and 2023.

The information has been prepared on the same basis as the consolidated financial statements.

The related adjustments

to the unaudited quarterly financial information resulting from similar adjustments discussed in Note 2 are also presented below.

Note 2 for descriptions of the misstatements in each category of restatements referenced by (a) and (b).

Presented below are the restated

condensed consolidated balance sheets, condensed consolidated statements of operations, consolidated statements of stockholders’

deficit and condensed consolidated statements of cash flows for each of the interim periods within the years ended December 31, 2024

BIOSCIENCES, INC.

AND QUALIFYING ACCOUNTS

ENDED DECEMBER 31, 2023 AND 2022

BALANCE SHEET

in thousands, except share and per share data)

of Restatement Unaudited Quarterly Results

As Previously Reported

Restatement Amount

Restatement Reference

March 31, 2023

As Previously Reported

Restatement Amount

Restatement Reference

Current assets:

Cash and cash equivalents

Accounts receivable

Other current assets

Total current assets

Property and equipment, net

Other intangible assets, net

Operating lease right of use assets

Other long-term assets

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities:

Accounts payable

Accrued salary and bonus

Other accrued expenses

Note payable at fair value, current

Line of credit - current

Current liabilities of discontinued operations

Total current liabilities

Contingent consideration

Operating lease liabilities, net of current portion

Note payable at fair value

Other long-term liabilities

Total liabilities

Redeemable preferred stock, $ .01 par value;

5,000,000 shares authorized, 47,000 shares Series B issued and outstanding

Stockholders’ deficit:

Common stock, $ .01 par value;

100,000,000 shares authorized;

4,390,826 shares issued and 4,311,414 shares outstanding;

Additional paid-in capital

Accumulated deficit

Treasury stock, at cost ( 79,412 shares)

Total stockholders’ deficit

Total liabilities and stockholders’ deficit

Total liabilities, preferred stock and stockholders’ deficit

accompanying notes are an integral part of these condensed consolidated financial statements

BIOSCIENCES, INC.

STATEMENTS OF OPERATION

in thousands, except for per share data)

As Previously Reported

Restatement Amount

Restatement Reference

For the Three Months Ended March 31, 2023

As Previously Reported

Restatement Amount

Restatement Reference

Cost of revenue

Operating expenses:

Sales and marketing

Research and development

General and administrative

Acquisition related amortization expense

Total operating expenses

Operating income from continuing operations

Interest accretion expense

Note payable interest expense

Other expense, net

Income from continuing operations before tax

Provision for income taxes

Income from continuing operations

Loss from discontinued operations, net of tax

Basic net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per basic share of common stock

Diluted net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per diluted share of common stock

Weighted average number of common shares and common share equivalents outstanding:

accompanying notes are an integral part of these condensed consolidated financial statements

Statements of Stockholders’ Deficit (unaudited)

Balance -March 31, 2023 as reported

$ ( 248,666 )

Cumulative adjustments to accumulated deficit in prior years

Cumulative adjustments to net income

Balance -March 31, 2023 as restated

$ ( 243,522 )

BIOSCIENCES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

in thousands)

for doubtful accounts

for doubtful notes

valuation allowance

for doubtful notes

valuation allowance

payments and actual write offs, as well as changes in estimates in the reserves.

As Previously Reported

Restatement Amount

Restatement Reference

For The Three Months Ended March 31,

As Previously Reported

Restatement Amount

Restatement Reference

Cash Flows From Operating Activities

Adjustments to reconcile net income to net cash

used in operating activities:

Depreciation and amortization

Interest accretion expense

Amortization of deferred financing fees

Stock-based compensation

debt expense reversal

Credit loss expense

Change in fair value of note payable

Amortization on operating lease right of use asset

Other changes in operating assets and liabilities:

Accounts receivable

Other current assets

lease right of use assets

Accounts payable

Accrued salaries and bonus

Other accrued expenses

lease liabilities

Long-term liabilities

Net cash provided by operating activities

Cash Flows From Investing Activity

Proceeds from sale of Interpace Pharma Solutions, net

capital adjustment on sale of Interpace Pharma Solutions

Purchase of property and equipment

Net cash used in investing activities

Cash Flows From Financing Activities

Payments made on note payable

Payments on line of credit

Net cash (used in) provided by financing activities

Net increase in cash and cash equivalents

Cash and cash equivalents from continuing operations– beginning

Cash and cash equivalents from discontinued operations– beginning

Cash and cash equivalents – beginning

Cash and cash equivalents from continuing operations– ending

Cash and cash equivalents from discontinued operations– ending

Cash and cash equivalents – ending

BIOSCIENCES, INC.

BALANCE SHEET

in thousands, except share and per share data)

As Previously Reported

Restatement Amount

Restatement Reference

June 30, 2023

As Previously Reported

Restatement Amount

Restatement Reference

Current assets:

Cash and cash equivalents

Accounts receivable

Other current assets

Total current assets

Property and equipment, net

Other intangible assets, net

Operating lease right of use assets

Other long-term assets

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities:

Accounts payable

Accrued salary and bonus

Other accrued expenses

Line of credit - current

Current liabilities of discontinued operations

Total current liabilities

Contingent consideration

Operating lease liabilities, net of current portion

Note payable at fair value

Other long-term liabilities

Total liabilities

Redeemable preferred stock, $ .01 par value;

5,000,000 shares authorized, 47,000 shares Series B issued and outstanding

Stockholders’ deficit:

Common stock, $ .01 par value;

100,000,000 shares authorized;

4,390,826 shares issued and 4,311,414 shares outstanding;

Additional paid-in capital

Accumulated deficit

Treasury stock, at cost ( 79,412 shares)

Total stockholders’ deficit

Total liabilities and stockholders’ deficit

Total liabilities, preferred stock and stockholders’ deficit

accompanying notes are an integral part of these condensed consolidated financial statements

BIOSCIENCES, INC.

STATEMENTS OF OPERATION

in thousands, except for per share data)

As Previously Reported

Restatement Amount

Restatement Reference

As Previously Reported

Restatement Amount

Restatement Reference

For the Three Months Ended June 30, 2023

For the Six Months Ended June 30, 2023

As Previously Reported

Restatement Amount

Restatement Reference

As Previously Reported

Restatement Amount

Restatement Reference

Cost of revenue

Operating expenses:

Sales and marketing

Research and development

General and administrative

Acquisition related amortization expense

Total operating expenses

Operating income from continuing operations

Interest accretion expense

Note payable interest expense

Other expense, net

Income from continuing operations before tax

Provision for income taxes

Income from continuing operations

Loss from discontinued operations, net of tax

Basic net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per basic share of common stock

Diluted net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per diluted share of common stock

Weighted average number of common shares and common share equivalents outstanding:

accompanying notes are an integral part of these condensed consolidated financial statements

Statements of Stockholders’ Deficit (unaudited)

Treasury Stock

Balance -March 31, 2023 as reported

$ ( 248,666 )

Cumulative adjustments to accumulated deficit in prior years

Cumulative adjustments to net income

Balance -March 31, 2023 as restated

$ ( 243,522 )

Balance -June 30, 2023 as reported

$ ( 248,491 )

Cumulative adjustments to accumulated deficit in prior years

Cumulative adjustments to net income

Balance -June 30, 2023 as restated

$ ( 242,963 )

BIOSCIENCES, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

in thousands)

As Previously Reported

Restatement Amount

Restatement Reference

For The Six Months Ended June 30,

As Previously Reported

Restatement Amount

Restatement Reference

Cash Flows From Operating Activities

Adjustments to reconcile net income to net cash

used in operating activities:

Depreciation and amortization

Interest accretion expense

Amortization of deferred financing fees

Stock-based compensation

Change in fair value of note payable

Other changes in operating assets and liabilities:

Accounts receivable

Other current assets

Operating lease right of use assets

Accounts payable

Accrued salaries and bonus

Other accrued expenses

Operating lease liabilities

Long-term liabilities

Net cash provided by operating activities

Cash Flows From Investing Activity

Working capital adjustment on sale of Interpace Pharma Solutions

Purchase of property and equipment

Net cash used in investing activities

Cash Flows From Financing Activities

Payments on line of credit

Net cash used in financing activities

Net increase in cash and cash equivalents

Cash and cash equivalents from continuing operations– beginning

Cash and cash equivalents from discontinued operations– beginning

Cash and cash equivalents – beginning

Cash and cash equivalents from continuing operations– ending

Cash and cash equivalents from discontinued operations– ending

Cash and cash equivalents – ending

BIOSCIENCES, INC.

BALANCE SHEET

in thousands, except share and per share data)

As Previously Reported

Restatement Amount

Restatement Reference

September 30, 2023

As Previously Reported

Restatement Amount

Restatement Reference

Current assets:

Cash and cash equivalents

Accounts receivable

Other current assets

Total current assets

Property and equipment, net

Other intangible assets, net

Operating lease right of use assets

Other long-term assets

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities:

Accounts payable

Accrued salary and bonus

Other accrued expenses

Current liabilities of discontinued operations

Total current liabilities

Operating lease liabilities, net of current portion

Note payable at fair value

Other long-term liabilities

Total liabilities

Redeemable preferred stock, $ .01 par value;

5,000,000 shares authorized, 47,000 shares Series B issued and outstanding

Stockholders’ deficit:

Common stock, $ .01 par value;

100,000,000 shares authorized;

4,407,492 shares issued and 4,321,772 shares outstanding;

Additional paid-in capital

Accumulated deficit

Treasury stock, at cost ( 85,720 shares)

Total stockholders’ deficit

Total liabilities and stockholders’ deficit

Total liabilities, preferred stock and stockholders’ deficit

accompanying notes are an integral part of these condensed consolidated financial statements

BIOSCIENCES, INC.

STATEMENTS OF OPERATION

in thousands, except for per share data)

As Previously Reported

Restatement Amount

Restatement Reference

As Previously Reported

Restatement Amount

Restatement Reference

For the Three Months Ended September 30, 2023

For the Nine Months Ended September 30, 2023

As Previously Reported

Restatement Amount

Restatement Reference

As Previously Reported

Restatement Amount

Restatement Reference

Cost of revenue

Operating expenses:

Sales and marketing

Research and development

General and administrative

Acquisition related amortization expense

Total operating expenses

Operating (loss) income from continuing operations

Interest accretion expense

Note payable interest expense

Other expense, net

Loss (income) from continuing operations before tax

Provision for income taxes

(Loss) income from continuing operations

Loss from discontinued operations, net of tax

Net (loss) income

Basic net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per basic share of common stock

Diluted net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per diluted share of common stock

Weighted average number of common shares and

common share equivalents outstanding:

accompanying notes are an integral part of these condensed consolidated financial statements

Statement of Stockholders’ Deficit (unaudited)

Treasury Stock

Balance -March 31, 2023 as reported

$ ( 248,666 )

Cumulative adjustments to accumulated deficit in prior years

Cumulative adjustments to net income

Balance -March 31, 2023 as restated

$ ( 243,522 )

Balance -June 30, 2023 as reported

$ ( 248,491 )

Cumulative adjustments to accumulated deficit in prior years

Cumulative adjustments to net income

Balance -June 30, 2023 as restated

$ ( 242,963 )

Balance -September 30, 2023 as reported

$ ( 249,105 )

Cumulative adjustments to accumulated deficit in prior years

Cumulative adjustments to net income

Balance -September 30, 2023 as restated

$ ( 243,149 )

BIOSCIENCES, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

in thousands)

As Previously Reported

Restatement Amount

Restatement Reference

For The Nine Months Ended September 30,

As Previously Reported

Restatement Amount

Restatement Reference

Cash Flows From Operating Activities

Net (loss) income

Adjustments to reconcile net (loss) income to net cash

used in operating activities:

Depreciation and amortization

Interest accretion expense

Amortization of deferred financing fees

Stock-based compensation

Change in fair value of note payable

Other changes in operating assets and liabilities:

Accounts receivable

Other current assets

Operating lease right of use assets

Accounts payable

Accrued salaries and bonus

Other accrued expenses

Operating lease liabilities

Long-term liabilities

Net cash provided by operating activities

Cash Flows From Investing Activity

Proceeds from sale of Interpace Pharma Solutions, net

Working capital adjustment on sale of Interpace Pharma Solutions

Purchase of property and equipment

Net cash provided by investing activities

Cash Flows From Financing Activities

Payments on line of credit

Net cash used in financing activities

Net increase in cash and cash equivalents

Cash and cash equivalents from continuing operations– beginning

Cash and cash equivalents from discontinued operations– beginning

Cash and cash equivalents – beginning

Cash and cash equivalents from continuing operations– ending

Cash and cash equivalents from discontinued operations– ending

Cash and cash equivalents – ending

BIOSCIENCES, INC.

BALANCE SHEET

in thousands, except share and per share data)

As Previously Reported

Restatement Amount

Restatement Reference

March 31, 2024

As Previously Reported

Restatement Amount

Restatement Reference

Current assets:

Cash and cash equivalents

Accounts receivable

Other current assets

Total current assets

Property and equipment, net

Operating lease right of use assets

Other long-term assets

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities:

Accounts payable

Accrued salary and bonus

Other accrued expenses

Note payable at fair value, current

Current liabilities of discontinued operations

Total current liabilities

Operating lease liabilities, net of current portion

Note payable at fair value

Other long-term liabilities

Total liabilities

Redeemable preferred stock, $ .01 par value;

5,000,000 shares authorized, 47,000 shares Series B issued and outstanding

Stockholders’ deficit:

Common stock, $ .01 par value;

100,000,000 shares authorized;

4,487,157 shares issued and 4,376,398 shares outstanding;

Additional paid-in capital

Accumulated deficit

Treasury stock, at cost ( 110,759 shares)

Total stockholders’ deficit

Total liabilities and stockholders’ deficit

Total liabilities, preferred stock and stockholders’ deficit

accompanying notes are an integral part of these condensed consolidated financial statements

BIOSCIENCES, INC.

STATEMENTS OF OPERATION

in thousands, except for per share data)

As Previously Reported

Restatement Amount

Restatement Reference

For the Three Months Ended March 31, 2024

As Previously Reported

Restatement Amount

Restatement Reference

Cost of revenue

Operating expenses:

Sales and marketing

Research and development

General and administrative

Total operating expenses

Operating income from continuing operations

Interest accretion expense

Note payable interest expense

Other expense, net

Income from continuing operations before tax

Provision for income taxes

Income from continuing operations

Loss from discontinued operations, net of tax

Basic net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per basic share of common stock

Diluted net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per diluted share of common stock

Weighted average number of common shares and

common share equivalents outstanding:

accompanying notes are an integral part of these condensed consolidated financial statements

Statement of Stockholders’ Deficit (unaudited)

Treasury Stock

Balance -March 31, 2024 as reported

$ ( 247,747 )

Cumulative adjustments to accumulated deficit in prior years

Cumulative adjustments to net income

Balance -March 31, 2024 as restated

$ ( 247,507 )

BIOSCIENCES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

in thousands)

As Previously Reported

Restatement Amount

Restatement Reference

For The Three Months Ended March 31,

As Previously Reported

Restatement Amount

Restatement Reference

Cash Flows From Operating Activities

Adjustments to reconcile net income to net cash

used in operating activities:

Depreciation and amortization

Interest accretion expense

Bad debt expense reversal

Stock-based compensation

Credit loss expense

Change in fair value of note payable

Amortization on operating lease right of use asset

Other changes in operating assets and liabilities:

Accounts receivable

Other current assets

Accounts payable

Accrued salaries and bonus

Other accrued expenses

Operating lease liabilities

Long-term liabilities

Net cash used in operating activities

Cash Flows From Investing Activity

Purchase of property and equipment

Net cash used in investing activities

Cash Flows From Financing Activities

Payments made on note payable

Net cash used in financing activities

Net decrease in cash and cash equivalents

Cash and cash equivalents from continuing operations– beginning

Cash and cash equivalents from discontinued operations– beginning

Cash and cash equivalents – beginning

Cash and cash equivalents from continuing operations– ending

Cash and cash equivalents from discontinued operations– ending

Cash and cash equivalents – ending

BIOSCIENCES, INC.

BALANCE SHEET

in thousands, except share and per share data)

As Previously Reported

Restatement Amount

Restatement Reference

June 30, 2024

As Previously Reported

Restatement Amount

Restatement Reference

Current assets:

Cash and cash equivalents

Accounts receivable

Other current assets

Total current assets

Property and equipment, net

Operating lease right of use assets

Other long-term assets

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities:

Accounts payable

Accrued salary and bonus

Other accrued expenses

Note payable at fair value, current

Current liabilities of discontinued operations

Total current liabilities

Operating lease liabilities, net of current portion

Other long-term liabilities

Total liabilities

Redeemable preferred stock, $ .01 par value;

5,000,000 shares authorized, 47,000 shares Series B issued and outstanding

Stockholders’ deficit:

Common stock, $ .01 par value;

100,000,000 shares authorized;

4,487,157 shares issued and 4,376,398 shares outstanding;

Additional paid-in capital

Accumulated deficit

Treasury stock, at cost ( 110,759 shares)

Total stockholders’ deficit

Total liabilities and stockholders’ deficit

Total liabilities, preferred stock and stockholders’ deficit

accompanying notes are an integral part of these condensed consolidated financial statements

BIOSCIENCES, INC.

STATEMENTS OF OPERATION

in thousands, except for per share data)

Previously Reported

For the Three Months Ended June 30, 2024

For the Six Months Ended June 30, 2024

As Previously Reported

Restatement Amount

Restatement Reference

As Previously Reported

Restatement Amount

Restatement Reference

Cost of revenue

Operating expenses:

Sales and marketing

Research and development

General and administrative

Total operating expenses

Operating income from continuing operations

Interest accretion expense

Note payable interest expense

Other expense, net

Income from continuing operations before tax

Provision for income taxes

Income from continuing operations

Loss from discontinued operations, net of tax

Basic net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per basic share of common stock

Diluted net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per diluted share of common stock

Weighted average number of common shares and common share equivalents outstanding:

accompanying notes are an integral part of these condensed consolidated financial statements

Statement of Stockholders’ Deficit (unaudited)

Treasury Stock

Balance -March 31, 2024 as reported

$ ( 247,747 )

Cumulative adjustments to accumulated deficit in prior years

Cumulative adjustments to net income

Balance -March 31, 2024 as restated

$ ( 247,507 )

Balance -June 30, 2024 as reported

$ ( 245,685 )

Cumulative adjustments to accumulated deficit in prior years

Cumulative adjustments to net income

Balance -June 30, 2024 as restated

$ ( 245,310 )

BIOSCIENCES, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

in thousands)

Previously Reported

For The Six Months Ended June 30,

As Previously Reported

Restatement Amount

Restatement Reference

Cash Flows From Operating Activities

Adjustments to reconcile net income to net cash

used in operating activities:

Depreciation and amortization

Interest accretion expense

Bad debt expense reversal

Stock-based compensation

Credit loss expense

Change in fair value of note payable

Amortization on operating lease right of use asset

Other changes in operating assets and liabilities:

Accounts receivable

Other current assets

Accounts payable

Accrued salaries and bonus

Other accrued expenses

Operating lease liabilities

Long-term liabilities

Net cash provided by operating activities

Cash Flows From Investing Activity

Purchase of property and equipment

Net cash used in investing activities

Cash Flows From Financing Activities

Payments made on note payable

Net cash used in financing activities

Net decrease in cash and cash equivalents

Cash and cash equivalents from continuing operations– beginning

Cash and cash equivalents from discontinued operations– beginning

Cash and cash equivalents – beginning

Cash and cash equivalents from continuing operations– ending

Cash and cash equivalents from discontinued operations– ending

Cash and cash equivalents – ending

accompanying notes are an integral part of these condensed consolidated financial statements

BIOSCIENCES, INC.

BALANCE SHEET

in thousands, except share and per share data)

As Previously Reported

Restatement Amount

Restatement Reference

September 30, 2024

As Previously Reported

Restatement Amount

Restatement Reference

Current assets:

Cash and cash equivalents

Accounts receivable

Other current assets

Total current assets

Property and equipment, net

Operating lease right of use assets

Other long-term assets

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities:

Accounts payable

Accrued salary and bonus

Other accrued expenses

Note payable at fair value, current

Current liabilities of discontinued operations

Total current liabilities

Operating lease liabilities, net of current portion

Other long-term liabilities

Total liabilities

Redeemable preferred stock, $ .01 par value;

5,000,000 shares authorized, 47,000 shares Series B issued and outstanding

Stockholders’ deficit:

Common stock, $ .01 par value;

100,000,000 shares authorized;

4,532,991 shares issued and 4,404,795 shares outstanding;

Additional paid-in capital

Accumulated deficit

Treasury stock, at cost ( 128,196 shares)

Total stockholders’ deficit

Total liabilities and stockholders’ deficit

Total liabilities, preferred stock and stockholders’ deficit

accompanying notes are an integral part of these condensed consolidated financial statements

BIOSCIENCES, INC.

STATEMENTS OF OPERATION

in thousands, except for per share data)

As Previously Reported

Restatement Amount

Restatement Reference

As Previously Reported

Restatement Amount

Restatement Reference

For the Three Months Ended September 30, 2024

For the Nine Months Ended September 30, 2024

As Previously Reported

Restatement Amount

Restatement Reference

As Previously Reported

Restatement Amount

Restatement Reference

Cost of revenue

Operating expenses:

Sales and marketing

Research and development

General and administrative

Total operating expenses

Operating income from continuing operations

Interest accretion expense

Note payable interest expense

Other expense, net

Income from continuing operations before tax

Provision for income taxes

Income from continuing operations

Loss from discontinued operations, net of tax

Basic net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per basic share of common stock

Diluted net income (loss) per share of common stock:

From continuing operations

From discontinued operations

Net income (loss) per diluted share of common stock

Weighted average number of common shares and common share equivalents outstanding:

accompanying notes are an integral part of these condensed consolidated financial statements

Statement of Stockholders’ Deficit (unaudited)

Treasury Stock

Balance -March 31, 2024 as reported

$ ( 247,747 )

Cumulative adjustments to accumulated deficit in prior years

Cumulative adjustments to net income

Balance -March 31, 2024 as restated

$ ( 247,507 )

Balance -June 30, 2024 as reported

$ ( 245,685 )

Cumulative adjustments to accumulated deficit in prior years

Cumulative adjustments to net income

Balance -June 30, 2024 as restated

$ ( 245,310 )

Balance -September 30, 2024 as reported

$ ( 244,405 )

Cumulative adjustments to accumulated deficit in prior years

Cumulative adjustments to net income

Balance -September 30, 2024 as restated

$ ( 244,009 )

BIOSCIENCES, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

in thousands)

As Previously Reported

Restatement Amount

Restatement Reference

For The Nine Months Ended September 30,

As Previously Reported

Restatement Amount

Restatement Reference

Cash Flows From Operating Activities

Adjustments to reconcile net income to net cash

used in operating activities:

Depreciation and amortization

Interest accretion expense

Bad debt expense reversal

Credit loss expense

Stock-based compensation

Change in fair value of note payable

Amortization on operating lease right of use asset

Other changes in operating assets and liabilities:

Accounts receivable

Other current assets

Accounts payable

Accrued salaries and bonus

Other accrued expenses

Operating lease liabilities

Long-term liabilities

Net cash provided by (used in) operating activities

Cash Flows From Investing Activity

Purchase of property and equipment

Net cash provided by investing activities

Cash Flows From Financing Activities

Payments made on note payable

Net cash used in financing activities

Net decrease in cash and cash equivalents

Cash and cash equivalents from continuing operations– beginning

Cash and cash equivalents from discontinued operations– beginning

Cash and cash equivalents – beginning

Cash and cash equivalents from continuing operations– ending

Cash and cash equivalents from discontinued operations– ending

Cash and cash equivalents – ending

accompanying notes are an integral part of these condensed consolidated financial statements

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 9A. Controls and Procedures