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Item 1. Business

2025-02-28 compared with 2024-02-28 · 196 added, 174 removed, 442 unchanged (46% of the section changed)

Overview and Mission

We are a leading genetic testing and precision medicine company dedicated to advancing health and well-being for all.

We develop and offer tests that help assess the risk of developing disease or disease progression and guide treatment decisions across medical specialties where genetic insights can significantly improve patient care and lower health care costs.

Our genetic tests provide insights that help people take control of their health and enable healthcare providers to better detect, treat, and prevent disease.

We are a leading molecular diagnostic testing and precision medicine company dedicated to advancing health and well-being for all.

We develop and offer molecular tests that help assess the risk of developing disease or disease progression and guide treatment decisions across medical specialties where molecular insights can significantly improve patient care and lower health care costs.

Our molecular tests provide insights that help people take control of their health and enable healthcare providers to better detect, treat, and prevent disease.

Our Business Strategy

Personalized genetic data, digital, and virtual consumer trends are converging to change traditional models of care.

We believe significant growth opportunities exist to help patient populations with pressing health care needs through innovative genetic and precision medicine solutions and services.

Personalize molecular data and digital and virtual consumer trends are converging to transform traditional models of care.

We believe that engaging with providers and patients throughout their consumer or patient journey will better enable us to execute our strategies and fulfill our mission.

We believe there are significant growth opportunities in addressing the pressing healthcare needs of patient populations through innovative molecular diagnostic testing and precision medicine solutions and services.

Our focus is on innovation and growth in three key areas where we have specialized products, capabilities, and expertise:

Oncology, Women's Health, and Pharmacogenomics.

The pillars of our long-term growth strategy are founded on investments in science and innovation, technology-enabled operations, an elevated customer experience, strong commercial execution, and scalable operations.

We believe our path to continued growth is driven by articulating our clinical differentiation, raising awareness with patients who we believe would benefit from our testing products, and innovation that improves clinical outcomes, ease of use, and access.

By investing in tech-enabled commercial tools, new laboratory facilities, advanced automation, and standardized processes and technology, we believe we will be able to reduce complexity and cost, while enhancing our ability to scale and grow.

We plan to expand some of our current products, such as our Foresight Universal Plus Test, which is an expanded carrier screening test that we anticipate launching in the second half of 2024.

We also plan to launch new products, such as FirstGene, Precise Liquid, and Precise minimal residual disease, which we expect will help accelerate our growth.

We intend to develop and enhance our products to support growth, improve patient and provider experience, and reach more patients of all backgrounds.

We are committed to disciplined management of a key set of initiatives to fulfill our mission and drive long-term growth and profitability.

Our long-term growth strategy is built on investments in science and innovation, technology-enabled operations, an enhanced customer experience, strong commercial execution, and scalable operations.

To drive continued growth, we plan to accelerate electronic medical records (EMR) integrations, expand our sales channels, including into large health systems, cross sell our portfolio of testing products to providers, enhance our testing products within medical guidelines, demonstrate our clinical differentiation and value compared to the standard of care, and optimize our revenue cycle processes.

For example, in June 2024, we launched the Universal Plus Panel to our Foresight Carrier Screen Test, which is an expanded carrier screening test.

We also continue to invest in clinical evidence development to support the growth of our existing products and launch of new products, such as FirstGene, Precise Liquid, and Precise molecular residual disease (MRD) which we expect will help us continue to grow.

We intend to continue to develop and enhance our products and services to support growth, improve patient and provider experience, and reach more patients of all backgrounds.

In addition, by investing in technology-enabled commercial tools, new laboratory facilities, advanced automation, and standardized processes and technology, we believe we will be able to reduce complexity and cost, while enhancing our ability to scale and grow.

For example, in early 2025, we plan to complete the transition of all of our laboratory activities to our next generation laboratory facilities, which we believe will improve the efficiency of our operations.

We are committed to making molecular testing accessible and actionable for patients and providers while driving long-term growth and profitability.

Our tests are generally designed to analyze genes and their expression levels to assess an individual’s risk for developing disease, determine a patient’s likelihood of responding to a particular drug, assess a patient’s risk of disease progression, identify factors which could lead to serious conditions in pregnancy, or provide other prenatal insights.

We focus our efforts in the following three key areas where we have specialized products, capabilities, and expertise:

Clarifying cancer risk and cancer treatment with genetic and genomic insights and companion diagnostic tests that are designed to work with corresponding drugs and treatments.

We focus our efforts in the following key areas where we have specialized products, capabilities, and expertise:

Clarifying cancer risk and cancer treatment with genetic insights and companion diagnostic tests that are designed to work with corresponding drugs and treatments.

Women's Health:

Providing differentiated genetic insights for women of all ancestries, assessing cancer risk, and offering prenatal testing solutions.

Providing differentiated genetic insights and prenatal solutions for women of all ancestries, assessing cancer risk, and offering leading health and wellness for expectant parents and their babies with genetic insights and prenatal solutions.

Pharmacogenomics:

Providing genetic insights to help physicians understand how genetic alterations impact patient response to anti-depressants and other drugs.

Leveraging pharmacogenomics to help clinicians understand how genetics may impact patient metabolism and response to antidepressants and other mental health medications.

The following tests are included in the key areas outlined above:

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Our MyRisk test is designed to determine a patient’s hereditary cancer risk for breast, ovarian, uterine, renal, colorectal, endometrial, melanoma, pancreatic, prostate, skin, and gastric cancers.

The test analyzes 48 separate genes to look for deleterious mutations that put a patient at a substantially higher risk than the general population for developing one or more of these cancers.

The test analyzes 48 separate genes to look for deleterious mutations that put a patient at a substantially higher risk than the general population for developing 11 different types of hereditary cancer.

All 48 genes in the panel are well documented in clinical literature for the role they play in hereditary cancer and have been shown to have actionable clinical interventions for the patient to facilitate earlier cancer detection, lower disease risk, or reduce risk of cancer recurrence.

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HRD status is determined using two independent methods:

BRCA1 and BRCA2 status that encompasses sequence variants and large rearrangements, and Genomic Instability Status (GIS) encompassing loss of heterozygosity, telomeric allelic imbalance, and large-scale state transitions across the entire genome.

BRCA1 and BRCA2 status that encompasses sequence variants and large rearrangements, and Genomic Instability Status encompassing loss of heterozygosity, telomeric allelic imbalance, and large-scale state transitions across the entire genome.

We believe that the combination of these methods is a more comprehensive way to measure HRD status, versus either one alone.

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RNA expression test for assessing the aggressiveness of breast cancer.

The EndoPredict test is a next-generation RNA expression test used to determine which women with breast cancer may benefit from chemotherapy.

The EndoPredict laboratory developed test is a next-generation RNA expression test used to determine which women with breast cancer may benefit from chemotherapy.

EndoPredict predicts the likelihood of metastases to help guide treatment decisions for chemotherapy and extended endocrine therapy.

EndoPredict has been shown to accurately predict risk of distant recurrence in Her 2-, ER+, node negative, and node positive breast cancer patients with no confusing intermediate results in 13 published clinical studies with more than 2,200 patients and is Conformitè Europëenne (CE) marked, which signifies European certification for clinical use.

Precise™ Tumor Molecular Profile Test :

a tumor profile test offered as part of Precise™ Oncology Solutions, a comprehensive solution for advanced precision oncology .

Precise Oncology Solutions combines our leading germline hereditary cancer tests (MyRisk/BRACAnalysis CDx), our HRD companion diagnostic test (MyChoice CDx), and a comprehensive genetic tumor panel.

We believe Precise Oncology Solutions will help providers determine a clear, integrated, and personalized treatment plan for patients with cancer.

a comprehensive genomic profiling test .

Precise Tumor is a pan-cancer, NGS-based assay that uses state-of-the-art, next-generation sequencing to discover and target important variants within tumors.

This hybrid-capture DNA- and RNA-based test detects Single-Nucleotide Variants (SNV), Insertion-Deletion Mutations (INDELs), Copy Number Variants (CNV), splice variants and fusions in solid tumors.

Prequel ® Prenatal Screen :

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AMPLIFY is a NIPS technology that substantially reduces low fetal fraction test failures in order to allow for equity in care across all patients, regardless of body mass index (BMI), race, or ethnicity.

Enabled by its AMPLIFY™ technology, Prequel is the first prenatal cell-free DNA (cfDNA) screen available at eight-weeks gestational age.

Foresight ® Carrier Screen :

a prenatal test for future parents to assess their risk of passing on a recessive genetic condition to their offspring.

The Foresight test screens for carrier status of up to 176 genes associated with serious and prevalent inherited conditions.

The test has been shown to have a detection rate of 99% across all ethnicities.

The expanded Foresight test screens for carrier status of up to 272 genes associated with serious and prevalent inherited conditions.

Our expanded Foresight screening test aligns with the American College of Medical Genetics and Genomics (ACMG) guidelines, which recommend offering expanded carrier screening to individuals who are pregnant or considering pregnancy.

Research has also shown that with prior knowledge of recessive genetic conditions, 76% of patients took preventive actions such as in-vitro fertilization with pre-implantation genetic testing to reduce the risk of having an affected offspring.

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a non-invasive blood test that predicts the gender of a fetus as early as six weeks of gestation with 99% accuracy.

Innovative cell free DNA technology and precise algorithms in the SneakPeek test are used to screen for a single, Y chromosome marker in the maternal blood sample.

Innovative cell free DNA technology and precise algorithms in the SneakPeek test are used to screen for a Y chromosome marker in the maternal blood sample.

If Y chromosome markers are found in the mother's blood, the baby is male.

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Sales and Marketing

We sell our tests primarily through our own sales force and marketing efforts in the United States, Japan, Germany, and France, and we service additional global accounts through indirect sales channels.

We primarily sell our tests through our sales force and marketing efforts in the United States and Japan, while servicing additional global accounts via indirect sales channels.

sales force is comprised of approximately 500 individuals across our dedicated sales channels.

We continue to optimize our sales and marketing channels through increased digital marketing, direct to patient marketing, enhanced virtual sales tools, and inside sales teams to drive efficiency in our sales model.

For example, in 2023, we formalized a national account focus in our Oncology and Women's Health products to address the needs of our largest accounts who are dealing with population health and value-based care decisions, while our field sales teams remained focused on core customers across channels.

We continue to expand and strengthen our inside sales team with improved segmentation and territory alignment and by expanding our inside sales team to cover additional products.

Our inside sales team focuses on a broader base of qualified leads, freeing up the field sales team to target higher potential clinical leads.

We believe inside sales can be more cost effective in terms of customer acquisition costs.

We believe we will be better able to execute on our strategies and fulfill our mission by engaging with providers and patients by meeting them when they are in the consumer or patient journey.

We continuously optimize our sales and marketing channels by increasing digital marketing, leveraging direct to patient marketing, enhancing virtual sales tools to drive efficiency, and utilizing our inside sales team.

To create a seamless experience for providers and patients, we are expanding our footprint in EMRs across hospital systems and other providers.

This allows us to offer the ordering and reporting functionality that providers need in their clinical practice.

Additionally, this investment allows us to better cross-sell our portfolio of products, providing a comprehensive set of tests for providers to use with their patients.

Foundational to that effort includes improving our products within medical guidelines to deliver value compared to the standard of care, which we believe will also lead to guideline and reimbursement expansion.

We also focus on engaging with patients directly in establishing their family health history, assessing their eligibility for our products, and interpreting their test results.

We believe that by engaging with patients throughout their entire journey, we deliver a comprehensive experience that ultimately boosts sales.

In the long term, we are committed to building an end-to-end digital architecture to meet the needs of patients and providers, which we believe will drive volume growth.

Research and Development

Our products stem from expert and innovative investigation into the biological underpinnings of serious human disease.

We plan to continue to use our proprietary DNA sequencing and RNA expression technologies, including our supporting bioinformatics and robotic technologies, in an effort to efficiently discover and validate important biomarkers.

We embed these biomarkers along with relevant clinical information in complex, proprietary tests that we believe are highly accurate and informative, and intended to help physicians better manage their patients’ health care.

We believe that our technologies provide us with a significant competitive advantage and the potential for the continued development of numerous product opportunities.

For example, in 2023 we completed analytical validation of FirstGene, a new product that is designed to report maternal and fetal carrier status, fetal aneuploidy risk, and Rhesus D antigen (RhD) status using a single maternal blood draw during pregnancy.

Also in 2023, we achieved enrollment targets for a FirstGene prospective clinical validation study.

We completed the development of, and launched, a research-use only minimum residual disease (MRD) product, and initiated study partnerships with MD Anderson Cancer Center and Memorial Sloan Kettering Cancer Center.

We also launched a prospective study, MONITOR-Breast, that we expect will generate evidence of the clinical validity of our MRD testing product.

We are committed to advancing our research and development (R&D) initiatives through a comprehensive approach to innovation.

Our R&D strategy focuses on expanding diagnostic capabilities, driving clinical utility, fostering strategic partnerships, and strengthening our intellectual property portfolio.

We continue to invest in the development of new innovative testing products and the enhancement of our existing portfolio of testing products.

These investments aim to enhance patient outcomes and broaden the accessibility of precision medicine.

Our R&D efforts prioritize robust clinical data and assay development to address key clinical questions.

By collaborating with healthcare professionals and researchers, we strive to validate and improve the clinical efficacy of our diagnostic solutions.

We also engage in strategic collaborations with key stakeholders, including regulatory bodies and reimbursement agencies, to define clinical guidelines and obtain insurance reimbursement coverage, supporting the broader adoption of our diagnostics in clinical practice.

Protecting and enhancing our intellectual property (IP) portfolio is a cornerstone of our innovation strategy.

We actively seek to extend and maximize the value of our existing patents to maintain a competitive edge in the molecular diagnostics landscape.

Our continued investment in R&D is designed to drive long-term value creation by delivering high-impact innovations that align with evolving healthcare needs.

As part of our long-term growth strategy, we plan to increase our investment in R&D in 2025 to drive innovation and new product development and enhance clinical evidence generation through clinical studies.

These initiatives align with our commitment to improving diagnostic accuracy, expanding our test portfolio, and strengthening our position in precision medicine.

We believe that our disciplined approach to R&D, coupled with strategic collaborations, will position us for sustainable growth and continued market leadership in the field of molecular diagnostic testing and precision medicine.

In 2024, we made significant advancements in our R&D efforts, strengthening our portfolio of innovative diagnostic solutions:

• Earlier Prenatal Screening with Prequel

◦ We began offering Prequel, our prenatal cell-free DNA screen, at eight weeks of gestational age, compared to the previous availability at 10 weeks.

◦ Earlier prenatal screening with Prequel enables earlier risk assessment for fetal chromosomal abnormalities, allowing expectant parents and healthcare providers to make more informed decisions sooner.

• Expanded Carrier Screening with Foresight

◦ Increased the number of conditions screened by Foresight Universal Plus, our expanded carrier screen, to 272 genes.

◦ Aligned with ACMG recommendations and anticipated guidance from the American College of Obstetricians and Gynecologists, ensuring clinical relevance and broad adoption.

• Advancements in MRD Testing

◦ Completed and presented analytical assessments at multiple conferences demonstrating the exceptional sensitivity of Precise MRD, our research-use-only MRD product.

◦ We have partnered in several clinical validation studies in breast cancer and renal cancer with leading institutions, including:

▪ MD Anderson Cancer Center

▪ Memorial Sloan Kettering Cancer Center

▪ University of Rochester Medical Center

• Global Collaboration on MRD Research

◦ Began processing samples for MONSTAR-3, a prospective pan-cancer MRD study, led by collaborators at the National Cancer Center East in Japan.

◦ Supported the continued development of MRD as a potential tool for monitoring cancer recurrence and treatment response.

These strategic R&D investments and collaborations underscore our commitment to innovation, regulatory alignment, and improved clinical utility for our current and future testing products.

We believe that by advancing the capabilities of our screening and diagnostic technologies, we continue to drive value for our patients, healthcare providers, and stakeholders.

For the years ended December 31, 2024, 2023, and 2022, we incurred research and development expense of $113.4 million, $88.7 million, and $85.4 million, respectively.

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Healthcare is evolving to be more patient-centered and value-based.

Patients, healthcare providers, payors, and health systems are looking to apply the power of genetic insights, molecular diagnostics, and precision medicine to advance care, improve access, and lower cost.

We believe key industry trends include:

We believe key industry trends include the following:

• accelerating shifts in consumer engagement, early detection, home-based care models, the rise of low-cost sequencing, telemedicine, and virtual care;

• demand for high-quality, clinically validated diagnostics that support early detection and targeted treatment strategies;

• expanding access to genetic insights, particularly among underserved populations with increased focus on health equity, reducing disparities in health care outcomes, and ensuring increased access for challenged communities;

• broader, more innovative use of large data sets and analytics;

• rapid technological advancements in automation and sequencing platforms, enabling scalable models for diagnostic testing, reducing costs, and enhancing operational efficiency;

• enhancements from artificial intelligence to automate image analysis, prior authorization, laboratory testing, and data interpretation, designed to increase speed and accuracy of testing;

• increasing adoption of biomarker laws on a state-by-state basis, which we expect will result in more growth and adoption of genetic testing by clinicians and acceptance by local reimbursement agencies;

• growth in personalized medicine and the interest in new partnership models to advance companion diagnostics and serve patients with specific treatments based on their own genetic makeup and biology.

We believe these market trends create new opportunities to position us for organic growth and commercial success through the launch of new products and the enhancement of our existing products.

Our focus is on articulating the clinical differentiation of our products and our commitment to being a reliable testing partner to patients and providers and innovative science that improves health outcomes, access for all, and ease of experience in the testing process.

We expect to use our ability to innovate not only in research, development, and technology, but also in go-to-market approaches, commercial capabilities, and tech-enabled applications to adapt quickly to customer preferences and market dynamics.

To measure our success in driving towards a strong and friction-less experience for our patients and clinicians, we periodically conduct an internal Net Promoter Score survey with current users of our products.

We have maintained a very healthy score since the implementation of the program in 2022, which gives us a strong benchmark to continue to work against as we strive to improve and innovate.

• growth in personalized medicine and the interest in new partnership models with academic and biopharma partners to advance companion diagnostics and serve patients with specific treatments based on their own genetic makeup and biology.

We believe these market trends present new opportunities to position us for organic growth and commercial success through the launch of new products and the enhancement of our existing products.

The ongoing market disruption in our sector also provides opportunities for market share gains.

Our focus is on articulating the clinical differentiation of our products, our commitment to being a reliable testing partner for patients and providers, and our dedication to innovative science that improves health outcomes, access for all, and ease of experience in the testing process.

We expect to use our ability to innovate not only in research, development, and technology, but also in go-to-market approaches, commercial capabilities, and technology-enabled applications to adapt quickly to customer preferences and market dynamics.

To measure our success in providing a seamless and efficient experience for both patients and clinicians, we periodically conduct a Net Promoter Score (NPS) survey among current users of our products.

NPS is a widely recognized metric used to gauge customer loyalty and satisfaction by asking respondents how likely they are to recommend our products on a scale of 0 to 10.

The score is calculated by subtracting the percentage of detractors (ratings of 0–6) from the percentage of promoters (ratings of 9–10), resulting in a range from -100 to 100.

Since the implementation of this program in 2022, we have consistently maintained a strong NPS above 70, which we believe indicates a high level of user satisfaction and advocacy.

This serves as a valuable benchmark for our ongoing efforts to enhance and innovate our offerings to better meet the needs of our patients and clinicians.

In oncology, we offer testing for patients who have cancer and companion diagnostic tests that work with corresponding drugs and treatments.

Our competitors in the oncology market include Invitae Corporation, Ambry Genetics Corporation, Natera, Inc., Foundation Medicine, Inc, Caris Life Sciences, Tempus, Laboratory Corporation of America Holdings, Quest Diagnostics Incorporated, and other commercial and academic laboratories.

As a leader in genetic testing and precision medicine, we provide insights that help people take control of their health, and enable healthcare providers to better detect, treat, and prevent disease.

We believe that the key opportunities to grow our Oncology business are our expansion of companion diagnostics, market expansion through new clinical guidelines, and providing new offerings.

For example, in the second quarter of 2023, we added Folate Receptor Alpha (FRα) to our Precise Oncology Solutions offering to expand treatment options for women living with ovarian cancer.

FRα establishes patient eligibility for ELAHERE® (“mirvetuximab soravtansine-gynx”), the only FDA-approved drug indicated for patients who are FRα-positive and resistant to platinum-based chemotherapy.

FRα is a newly recommended biomarker test included in the National Comprehensive Cancer Network treatment guidelines for ovarian cancer.

Additionally, in the fourth quarter of 2023, we launched the Myriad Collaborative Research Registry™ (MCRR).

The MCRR includes new data across germline and tumor testing results from our cancer products on more than one million patients.

The latest enhancements make the MCRR freely available for research use and supports transparent clinical data sharing to advance the field.

In late 2024, we also plan to add a new liquid biopsy therapy selection test called Precise Liquid to the comprehensive Precise Oncology Solutions offering.

The test is a comprehensive genomic profiling test that may serve as a first-line offering or as a reflex test if the solid tumor is insufficient, and it will allow blood for therapy selection at diagnosis and in the metastatic setting.

Our competitors in the oncology market include Natera, Inc., Foundation Medicine, Inc., Caris Life Sciences, Tempus, Laboratory Corporation of America Holdings, Quest Diagnostics Incorporated, Veracyte, Inc.

and other commercial and academic laboratories.

As a leader in molecular diagnostic testing and precision medicine, we provide insights that help people take control of their health, and enable healthcare providers to better detect, treat, and prevent disease.

Whether it's therapy selection, early recurrence detection, or later in the patient journey, our products provide actionable, scientific insights to oncologists that can facilitate their treatment of patients.

We believe that the key opportunities to grow our Oncology business include expanding our diagnostic offerings, adding indications and genes to existing oncology tests, reducing friction for providers with automated ordering and reporting, and increasing our focus and investment in clinical evidence generation.

In 2026, we plan to add a new liquid biopsy therapy selection test called Precise Liquid to our comprehensive Oncology offerings.

The test is a comprehensive genomic profiling test that may serve as a first-line offering or as a reflex test if the solid tumor is insufficient, and the test is expected to allow therapy selection at diagnosis and in the metastatic setting.

We are also developing Precise MRD, a monitoring test based on whole genome sequencing to deeply interrogate tumors, detect cancer recurrence earlier, and help guide treatment decisions.

Women’s Health

In the women’s health market, we serve women assessing their genetic predisposition to cancer, offer prenatal tests for the assessment of fetal chromosomal disorders, and screen prospective parents for recessive genetic conditions that can be passed on to their offspring.

We also offer the SneakPeek Early Gender DNA Test which can reveal a baby's gender as early as six weeks into pregnancy.

We also offer the SneakPeek Early Gender DNA Test which predicts a baby's fetal sex as early as six weeks into pregnancy.

We compete with multiple companies, including large national reference laboratories, specialty laboratories, academic/university laboratories, and kit-based products with our MyRisk, Foresight, Prequel and SneakPeek tests.

Our competitors include Natera, Inc., Ambry Genetics Corporation, Laboratory Corporation of America Holdings, a subsidiary of Konica Minolta Inc., Quest Diagnostics Incorporated, and Peekaboo Early Detection Gender DNA Test.

Our competitors in women's health include Natera, Inc., Laboratory Corporation of America Holdings, Quest Diagnostics Incorporated, BillionToOne, Inc., Tempus AI, Inc., and Peekaboo Early Detection Gender DNA Test.

We compete mainly based on our test breadth and accuracy, equity in care capability, and our commercial scale.

We see opportunities to improve both our economics and the customer experience on these products.

We remain focused on reimbursement for prenatal and carrier screening and finding streamlined patient payment models.

We have recently expanded our physical footprint by growing our SneakPeek product presence into the retail pharmacy setting, which we believe is a strong opportunity for us to target consumers with our prenatal portfolio of offerings beyond directly through physicians.

We also plan to improve customer experience with our online unified ordering portal to engage with patients and physicians, our cost estimators across our product lines, our remote product-specific customer service teams, and artificial intelligence-based tools for interacting with patients.

We expect to further simplify and advance prenatal care with the launch of FirstGene ™, a comprehensive prenatal screening test.

FirstGene combines the power of our Prequel NIPS with AMPLIFY technology on a whole exome platform with our Foresight Carrier Screen into a new 4-in-1 prenatal offering for NIPS, carrier screen, fetal recessive status, and feto-maternal blood compatibility.

This new test, which is expected to launch in the first half of 2025, is designed to streamline the testing process and simplify workflow with a single maternal blood draw while providing early insight on the fetus with improved sensitivity for all pregnancies, helping to reduce unnecessary amniocentesis.

We have previously announced our support for the guideline update by the American College of Medical Genetics and Genomics (ACMG), which reaffirmed the clinical value of NIPS to screen for a range of chromosomal abnormalities.

We see opportunities to continue to drive growth in our Women's Health business by enhancing our prenatal products to improve patient access and deliver differentiated clinical utility, improving our cancer risk assessment programs with enhanced testing, ordering and reporting, and automating workflows to drive increased adoption of our breast cancer risk assessment program into large health systems and obstetrician and gynecologist practices.

We also remain focused on reimbursement for prenatal and carrier screening and finding streamlined patient payment models.

We have expanded our SneakPeek product presence into retail stores, which we believe provides a strong opportunity for us to target consumers with our prenatal portfolio of offerings beyond reaching these patients directly through physicians.

We also plan to deliver improved and differentiated experiences for patients and physicians through an advanced, end-to-end digital architecture as we improve our test ordering and order management experience and digital tools for interacting with patients.

For example, Foresight Universal Plus, which launched in the second half of 2024, is an expanded carrier screening test that includes up to 272 genes.

We also expect to further simplify and advance prenatal care with the launch of FirstGene ™, a comprehensive prenatal screening test.

FirstGene combines the power of our Prequel NIPS with AMPLIFY technology on a targeted exome platform with our Foresight Carrier Screen into a new 4-in-1 prenatal offering for NIPS, carrier screen, fetal recessive status, and feto-maternal blood compatibility.

This new test, which is expected to launch in 2025, is designed to streamline the testing process and simplify workflow with a single maternal blood draw while providing early insight on the fetus with improved sensitivity for all pregnancies, helping to reduce unnecessary amniocentesis.

We have previously announced our support for the guideline update by the ACMG, which reaffirmed the clinical value of NIPS to screen for a range of chromosomal abnormalities.

ACMG continues to recommend offering screening for common trisomies (on chromosomes 13, 18, and 21) in all pregnancies, and guidance that provides a strong recommendation for offering screening for sex-chromosome aneuploidies (SCAs) and conditional support for offering screening for 22q microdeletion syndrome.

As part of the NIPS within FirstGene, both SCAs and 22q are expected to be available as additional opt-in screening.

Foresight Universal Plus is an expanded carrier screening test with the same technology that differentiates Foresight’s clinical utility in carrier screening.

We plan to launch this test in the second half of 2024 in anticipation of the expansion of American College of Obstetricians and Gynecologists (ACOG) guidelines, which we anticipate will be expanded to include 274 genes.

This new test will also include merged couple reporting to fully realize the value of this test to those individuals who are thinking about family planning.

We believe Foresight Universal Plus and FirstGene when launched, will strengthen our clinical differentiation in the growing carrier screening market, and provides us an opportunity to meet the increasing demand for advanced reproductive genetic testing in 2025 and beyond.

Pharmacogenomics

In Pharmacogenomics, we help physicians understand how genetic alterations may impact patient response to antidepressants and other drugs.

In Pharmacogenomics, we help physicians and other front-line providers understand how genetic alterations may impact patient response to antidepressants and other drugs.

We believe our GeneSight Psychotropic Mental Health Medication Test meets a significant unmet clinical need and is a leading product to help physicians anticipate patient response to psychotropic drugs, the selection of which has historically been done through trial and error-based approaches.

The test is clinically proven to improve response rates in patients compared to standard of care.

The test has been shown to improve response rates in patients compared to standard of care.

Our competitors in this market include Genomind, Tempus, Quest Diagnostics Incorporated, and Laboratory Corporation of America Holdings.

Key opportunities to grow our business in this market include growing awareness of pharmacogenomic opportunities for mental health treatment and driving physician adoption and utilization of our product to help guide treatment options.

We are broadening access to GeneSight among front-line providers of mental health treatment, including primary care physicians and nurse practitioners who treat the majority of patients suffering from depression and anxiety, and through the expansion of sales and digital marketing capabilities.

Moving forward, we are exploring the extension of GeneSight in other indications as well as other areas such as postpartum depression through our Women's Health business.

Key opportunities to maintain our leadership position and grow our business in this market include increasing awareness of pharmacogenomic opportunities for mental health treatment and driving physician adoption and utilization of our product to help guide treatment options.

We believe our highly effective digital engagement and provider on-boarding approach broadens access to GeneSight among front-line providers of mental health treatment, including primary care physicians and nurse practitioners who treat the majority of patients suffering from depression and anxiety.

We continue to work on expanding coverage, including through the increasing number of state biomarker laws, while also optimizing our patient direct-payment options and workflow to maximize reimbursement.

We have historically experienced seasonality in our testing business.

In the quarter ended March 31, we typically experience a decrease in volumes due to the annual reset of patient deductibles.

Additionally, the volume of testing is typically negatively impacted by the summer season, which is generally reflected in the quarter ended September 30.

Conversely, the quarter ended December 31 is generally strong as we typically experience an increase in volumes from patients who have met their annual insurance deductible.

In the fiscal year ended December 31, 2023, we did not experience seasonality to the same extent we have in prior years.

For example, in the quarter ended September 30, 2023, we did not see the customary impact from the summer season as volumes decreased less than one percent in comparison to the quarter ended June 30, 2023.

Historical patterns of seasonality may not continue in future years.

The quarters ending March 31 and September 30 are typically weaker due to the annual reset of patient deductibles in the beginning of each calendar year and vacation schedules in the summer.

The quarter ending December 31 is typically stronger due to increased demand as patients meet their deductibles throughout the year;

however, due to various factors, including disruptions in workflows arising from EMR integrations, volumes were less than expected for the quarter ended December 31, 2024.

Seasonal patterns were disrupted in previous years as a result of the COVID pandemic and certain other factors, but we believe pre-COVID seasonality impacted 2024, particularly in the third quarter.

Additionally, operating results for the twelve months ended December 31, 2024 may not necessarily be indicative of results to be expected for any year.

Human Capital Management

As a leader in genetic testing and precision medicine, our mission is to advance health and well-being for all by helping people take control of their health and enabling healthcare providers to better detect, treat and prevent disease.

As a leader in molecular diagnostic testing and precision medicine, our mission is to advance health and well-being for all by helping people take control of their health and enabling healthcare providers to better detect, treat and prevent disease.

We believe the success of our mission depends, in part, on our ability to attract and retain qualified personnel.

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For the year ended December 31, 2024, our global voluntary employee turnover rate was 10%.

Diversity, Equity and Inclusion (DE&I) :

Our DE&I objective is to make Myriad a place where all employees have a sense of belonging.

Myriad supports a culture of diversity, equity, and inclusion aligned with our company mission, vision, and values to drive company performance by creating opportunities and experiences for learning, development, and a sense of belonging for all employees.

Our DE&I plan is focused on our people, mission, and community.

Caring and Belonging :

Our objective is to make Myriad a place where all employees have a sense of belonging.

Myriad supports a culture of caring and inclusion aligned with our company mission, vision, and values to drive company performance by creating opportunities and experiences for learning, development, and a sense of belonging for all employees.

We have seven employee-led resource groups (ERGs) that represent and support diverse communities in our workforce.

These ERGs mentor, foster, encourage, and inspire employees in all stages of their careers by providing access to senior leadership, peer groups, mentoring, and other valuable resources to help them pursue their career ambitions.

As of December 31, 2023, 63% of our employees were women, and women held 42% of Myriad leadership roles (vice president and above).

One third of the members of our Board of Directors are women, including the chairperson, and 44% of our Board members come from diverse gender, ethnic, and cultural backgrounds.

Our active ERG communities provide a safe space for teammates from shared backgrounds and their allies to connect, communicate and support each other.

These ERGs are designed to mentor, foster, encourage, and inspire employees in all stages of their careers by providing access to senior leadership, peer groups, mentoring, and other valuable resources to help them pursue their career ambitions.

As of December 31, 2024, approximately 64% of our employees were women, and women held 39% of Myriad leadership roles (vice president and above).

Approximately one third of the members of our Board of Directors are women, including the chairperson, and 44% of the members of our Board of Directors come from diverse gender, ethnic, and cultural backgrounds.

Compensation, Health, Wellness, Family Resources, and Other Benefits :

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The results are reviewed by our Board of Directors, the Compensation and Human Capital Committee, and senior leadership, who analyze areas of progress or deterioration and prioritize actions and activities in response to this feedback to drive meaningful improvements in employee engagement.

Our most recent survey shows how these intentional efforts are making a difference as 86% of our employees rated us as a Great Place to Work ®.

Social Responsibility and Community :

We believe our most recent survey in 2024 shows how these intentional efforts are making a difference as 84% of our employees rated us as a Great Place to Work ® .

Corporate Responsibility and Community :

At Myriad, corporate responsibility plays an important role in our approach to developing valuable and transformative diagnostic tests across major diseases to improve patients' lives.

We believe that our corporate social responsibility programs build greater value for our patients, healthcare professionals and stockholders, support and improve the communities where we live and work, and empower our employees to become more engaged in the well-being of their own communities.

The corporate social responsibility programs at Myriad align with a clearly defined set of strategic priorities including:

We believe that our corporate responsibility programs build greater value for our patients, healthcare professionals and stockholders, support and improve the communities where we live and work, and empower our employees to become more engaged in the well-being of their own communities.

The corporate responsibility programs at Myriad align with a clearly defined set of strategic priorities including the following:

• Patient Assistance :

We are working to improve overall health care quality and increase access to diagnostic testing for uninsured and underinsured populations by offering robust financial assistance and free testing to those in need.

We collaborate with and support key patient advocacy and support organizations where we can make a positive difference in addressing complex health challenges, providing and improving the quality of life for patients.

• Environmental :

As described further below, we have created a Green Team that helps foster environmental and sustainability stewardship.

We are working to improve overall health care quality and increase access to diagnostic testing for those in need by offering robust financial assistance.

We collaborate with patient advocacy and support organizations where we believe we can make a positive difference in addressing complex health challenges, provide education about diagnostic testing, and improve the quality of life for patients.

• Sustainability :

As described further below, we continue to explore ways in which we can minimize our environmental impacts.

• Scholarship :

We provide financial support for academic scholarship and education at both the undergraduate and post-graduate levels and contribute to advancing education and training for women and minorities in medicine and science.

We provide financial support for academic scholarships and contribute to advancing education and training for women and minorities in medicine and science.

• Philanthropy :

We provide financial support to nonprofit organizations and share the expertise of our employees in the communities where we operate.

Environmental and Sustainability

Sustainability

We strive to do business in ways that protect both the health and safety of our employees and the world in which we operate by establishing, promoting, maintaining, and improving a culture of sustainability and environmental responsibility.

In order to achieve our objectives, we have increased our focus on environmental and sustainability efforts that we are working towards fully implementing.

The Nominating, Environmental, Social and Governance Committee of our Board of Directors is responsible for reviewing and evaluating our environmental, climate, safety, social and other corporate responsibility strategies, practices, and initiatives.

We have also formed an internal Environmental, Social, and Governance (ESG) Committee in an effort to develop and maintain sustainable business practices.

In connection with our 2022 Environmental, Social and Governance Report, we completed our first carbon inventory, measuring our Scope 1 and Scope 2 emissions from the use of our laboratories and office spaces during the year ended December 31, 2022.

Energy and emissions data was captured for select buildings with the largest footprint and used to model emissions from our remaining operations where limited or no data was available.

For more information on our approach to sustainability, please refer to our 2022 Environmental, Social and Governance Report, which is available on our website.

Our Myriad Green Team engages employees across our business in environmental activities and events that benefit local communities.

We continue to recycle plastics used in our laboratory facilities.

Our new laboratories in west Salt Lake City, Utah and South San Francisco, California include energy and water efficiency and other environmental-friendly features.

The Nominating and Governance Committee of our Board of Directors is responsible for reviewing and evaluating our environmental, climate, safety, social and other corporate responsibility strategies, practices, and initiatives.

In connection with our 2023-2024 Quality, Innovation, and Corporate Responsibility Report, we disclosed our Scope 1 and Scope 2 emissions data.

Moving forward, we plan to improve our environmental footprint assessment and provide additional public disclosures regarding our environmental performance to our stockholders.

For more information on our approach to sustainability, please refer to our 2023-2024 Quality, Innovation, and Corporate Responsibility Report, which is available on our website.

Patents and Proprietary Rights

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For some of the patent assets, we hold rights through exclusive or non-exclusive license agreements.

Material issued patent assets relating to our tests that generate material revenue are described in the table below, along with any related pending applications.

Material issued patent assets relating to our tests that generate, or are expected to generate, material revenue are described in the table below, along with any related pending applications.

These issued patents are expected to begin expiring on the respective dates noted below and any related applications, if issued as patents and depending on term adjustments or terminal disclaimers, if applicable, are expected to have similar expiration timeframes.

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Claims relating to biomarkers, kits, systems and methods for detecting, diagnosing, prognosing and selecting therapy for prostate cancer.

EndoPredict Breast Cancer Prognostic Test We own one or more issued patents and pending patent applications in the U.S.

and other jurisdictions relating to EndoPredict testing.

These pending and issued patents have terms expected to begin expiring in 2031.

Claims relating to biomarkers, kits, systems and methods for prognosing and selecting therapy for breast cancer.

MyChoice CDx Companion Diagnostic Test We own or hold a license to one or more issued patents and pending patent applications in the U.S.

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and other jurisdictions relating to GeneSight testing.

These pending and issued patents have terms expected to begin expiring in 2024.

Certain patents began expiring in 2024 and the remaining pending and issued patents have terms expected to begin expiring in 2027.

Claims relating to biomarkers, systems and methods for detecting single nucleotide polymorphisms and selecting and/or optimizing therapy based on such detection.

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Claims relating to systems and methods for preparing enriched DNA fractions, detecting circulating tumor DNA, and identifying tumor variants.

We intend to seek patent protection in the United States and major foreign jurisdictions for these and other inventions which we believe are patentable and where we believe our interests would be best served by seeking patent protection.

We own one or more issued patents and pending patent applications in the U.S.

or other jurisdictions relating to SneakPeek testing.

These pending and issued patents have terms expected to begin expiring in 2040.

Claims relating to methods of improving the accuracy of fetal sex determination by reducing a level of contaminating DNA in a blood sample from a pregnant human subject and/or methods of detecting target fetal nucleic acids in a sample.

We have or intend to seek patent protection in the United States and major foreign jurisdictions for these and other inventions which we believe are patentable and where we believe our interests would be best served by seeking patent protection.

However, any patents issued to us or our licensors may not afford meaningful protection for our products or technology or may be subsequently circumvented, invalidated or narrowed or found unenforceable.

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Should any other group obtain patent protection with respect to our discoveries, our commercialization of our tests could be limited or prohibited.

Others may offer genomic laboratory testing services which may infringe patents we control.

We may seek to negotiate a license to use our patent rights or decide to seek enforcement of our patent rights through litigation.

Patent litigation is expensive, the outcome is often uncertain and we may not be able to enforce our patent rights against others.

Our tests and processes may also conflict with patents which have been or may be granted to competitors, academic institutions or others.

In addition, third parties could bring legal actions against us seeking to invalidate our owned or licensed patents, claiming damages, or seeking to enjoin clinical testing, development and marketing of our tests or processes.

If any of these actions are successful, in addition to any potential liability for damages, we could lose patent coverage for our tests, be required to cease the infringing activity or obtain a license in order to continue to develop or market the relevant test or process.

We may not prevail in any such action, and any license required under any such patent may not be made available on acceptable terms, if at all.

Our failure to maintain patent protection for our tests and processes or to obtain a license to any technology that we may require to commercialize our tests and technologies could have a material adverse effect on our business.

We also rely upon unpatented proprietary technology, and in the future may determine in some cases that our interests would be better served by protecting certain technologies as trade secrets or through confidentiality agreements rather than patents or licenses.

These include some of our genomic, proteomic, RNA expression, mutation analysis, robotic and bioinformatic technologies which may be used in discovering and characterizing new biomarkers and ultimately used in the development or analysis of tests.

We also maintain a database of gene mutations and their status as either harmful or benign for some of our tests.

To further protect our trade secrets and other proprietary information, we require that our employees and consultants enter into confidentiality and invention assignment agreements.

However, those confidentiality and invention assignment agreements may not provide us with adequate protection.

We may not be able to protect our rights to such unpatented proprietary technology and others may independently develop substantially equivalent technologies.

If we are unable to obtain strong proprietary rights to our processes or tests, competitors may be able to market competing processes and tests.

We describe whether and how risks related to our intellectual property have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations, or financial condition, under the heading " Risks Related to Our Intellectual Property ", included in Part I, Item 1A of this Annual Report on Form 10-K.

License Agreements

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Our failure to maintain rights to this technology could have a material adverse effect on our business.

The table below lists important licenses to technology that is incorporated into tests that generate material revenue:

The table below lists important licenses to technology that is relevant to certain of our tests:

Entity Subject Royalties Expiration

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License runs for the term of the Illumina agreement and, in any event, expires or may be terminated upon expiration of the last to expire patent right covered by the Illumina agreement.

Eurobio Scientific SA (Eurobio)

Exclusive license to certain rights of Eurobio in intellectual property relating to our EndoPredict assay.

We pay Eurobio a royalty based on net sales of our EndoPredict test.

License runs for the term of the Eurobio agreement and, in any event, expires or may be terminated upon expiration of the last to expire patent right covered by the Eurobio agreement.

Governmental Regulation

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CLIA requires each of our certified clinical laboratories to enroll in an approved proficiency testing program if performing testing in any category for which proficiency testing is required.

Each of our clinical laboratories periodically tests specimens received from an outside proficiency testing organization and then submits the results back to that organization for evaluation.

Each of our clinical laboratories periodically tests specimens, where available, received from an outside proficiency testing organization and then submits the results back to that organization for evaluation.

If one of our laboratories fails to achieve a passing score on a proficiency test, then it may lose its right to perform testing.

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For certain types of tests known as laboratory developed tests (LDTs)—which are in vitro diagnostic tests that are designed, manufactured and used within a single laboratory—FDA regulation is less clear than for IVDs.

Historically, the FDA has exercised enforcement discretion for LDTs, which means that the FDA generally has not enforced premarket review and other applicable FDA requirements.

Historically, the FDA had exercised enforcement discretion for LDTs, meaning that the FDA generally did not enforce premarket review and other applicable FDA requirements.

However, as LDTs have increased in complexity, the FDA has taken a risk-based approach to their regulation.

Congress has also signaled interest in clarifying the regulatory landscape for LDTs.

Following several years of inaction by Congress on this issue, the FDA issued a proposed rule in October 2023 to regulate LDTs under the current medical device framework and proposed to phase out the current enforcement discretion policy;

the public comment period ended in early December 2023.

The FDA’s proposal envisions that the LDT enforcement policy phase-out process would occur in gradual stages over a total period of four years, with premarket approval applications for high-risk tests to be submitted by the 3.5-year mark, although more details are expected to be provided with the upcoming final rule.

The likelihood of the FDA finalizing the proposed rule in April 2024 (as is currently projected), as well as potential litigation challenging the agency’s authority to take such action, is uncertain at this time.

Affected stakeholders continue to press for a comprehensive legislative solution to create a harmonized paradigm for oversight of LDTs by both the FDA and CMS, instead of implementation of the proposed FDA administrative action, which may be disruptive to the industry and to patient access to certain diagnostic tests.

In the absence of a comprehensive legislative solution, however, the FDA has indicated its intent to finalize this rulemaking.

Following several years of inaction by Congress on this issue, the FDA issued a final rule in May 2024 to regulate LDTs under the current medical device framework and proposed to phase out the current enforcement discretion policy;

the final rule became effective on July 5, 2024.

The FDA LDT enforcement policy phase-out process will occur in gradual stages over a total period of four years, with premarket approval applications for high-risk tests to be submitted by the 3.5-year mark.

Moderate-risk and low-risks tests are expected to be in compliance at the 4-year mark, although FDA has stated that if premarket submissions are pending review it will continue to exercise enforcement discretion with respect to those tests.

The FDA’s final rule is complex and, concurrently, the agency announced several exceptions from the requirement to comply with full medical device regulatory controls, depending upon the specific nature of the LDT and the clinical laboratory that is offering such LDT for use by health care providers.

We have begun the process of implementing the final rule with respect to our tests, our operations, and our business more generally.

Publication of the LDT final rule prompted the American Clinical Laboratory Association (ACLA) and one of its members, on May 29, 2024, as well as the Association for Molecular Pathology (AMP) and one of its members, on August 19, 2024, to file complaints against the FDA in the Eastern District of Texas and the Southern District of Texas, respectively.

Both complaints allege that the agency does not have authority to promulgate the LDT final rule and seek to vacate the FDA’s action;

the two cases were subsequently consolidated into a single action pending in the Eastern District of Texas.

Briefing is ongoing in the consolidated case and the outcome is uncertain.

The ongoing litigation could potentially affect the FDA’s plans to implement these new LDT requirements, making the implementation timeline somewhat uncertain although no preliminary injunction has been issued to date.

Accordingly, the agency has continued its implementation efforts by actively providing guidance and training to clinical laboratories on how to comply with medical device general controls.

Following the November 2024 federal elections, it is unclear whether the incoming Trump Administration will continue to defend the FDA’s rulemaking action in the consolidated litigation in Texas or if it will take steps to rescind or modify the LDT final rule.

Affected stakeholders also continue to press for a comprehensive legislative solution to create a harmonized paradigm for oversight of LDTs by both the FDA and CMS, instead of implementation of the FDA's final rule, which may be disruptive to the industry and to patient access to certain diagnostic tests.

Ensuring compliance with the agency’s future implementation plans for bringing LDTs under the medical device framework is expected to require significant time, financial resources, and other resources, including specialized personnel, on the part of clinical laboratories engaged in developing and offering such diagnostic tests.

Separately, members of Congress have been working with stakeholders for several years on a possible bill to reform the regulation of in vitro clinical tests including LDTs.

For example, as drafted and re-introduced for consideration by the current Congress, the Verifying Accurate, Leading-edge IVCT Development (VALID) Act would codify into law the term as "in vitro clinical test" (IVCT) and establish a new regulatory framework for the review and oversight of IVCTs separate and apart from the medical device framework under the Food, Drug and Cosmetic Act (FDCA).

The new IVCT product category would include products currently regulated as IVDs, in addition to LDTs.

The proposed regulatory framework adopts various concepts from the FDCA, utilizing a risk-based approach that aims to ensure that all marketed IVCTs have a reasonable assurance of both analytical and clinical validity, and includes a proposed future user fee program for IVCTs.

If enacted, the VALID Act would also create a new system for clinical laboratories and hospitals to submit their clinical tests electronically to the FDA for approval, among other potentially significant changes to current regulatory requirements applicable to the laboratory industry as a whole.

This system is aimed at reducing the amount of time that it takes for the agency to approve such tests, and it would also establish a new program to expedite the development of diagnostic tests that can be used to address a current unmet need for patients.

It is unclear whether the VALID Act will be passed by Congress in its current form or signed into law by the President;

if enacted, however, it is expected to require clinical laboratories to spend significant time, resources, and money towards ensuring compliance.

Until the FDA finalizes LDT regulations through its recently initiated notice-and-comment rulemaking process, or the VALID Act or other legislation is passed reforming the federal government’s current regulatory approach to LDTs, it is unknown how the FDA may regulate our LDT products in the future or what testing and data may be required to support clearance or approval for such products.

However, this FDA rulemaking was initiated after years of failed congressional attempts to harmonize the regulatory paradigms applicable to LDTs and other IVDs, making it unclear whether any legislative efforts would be successful going forward.

The outcome of the November 2024 elections on the composition of the 2025-2026 Congress, with both the Senate and House transitions to Republican control, also creates uncertainties for the diagnostic industry.

In Vitro Diagnostics as Medical Devices

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If the FDA believes that the IVD is not substantially equivalent to a predicate device, it will issue a “Not Substantially Equivalent” letter, stating that the new device may not be commercially distributed and designating the device as a Class III device, which will require the submission and approval of a PMA application before the new device may be marketed.

Alternatively, the applicant may be able to submit a De Novo classification request to have it regulated as a Class I or Class II device.

The FDA's De Novo regulations became effective on January 3, 2022.

Alternatively, the applicant may be able to submit a De Novo classification request to have the new device regulated as a Class I or Class II device instead of under the automatic Class III designation.

Among other things, if the manufacturer seeks reclassification into Class II, the classification request must include a draft proposal for special controls that are necessary to provide a reasonable assurance of the safety and effectiveness of the device.

As an alternative to the De Novo classification process, the manufacturer could also file a reclassification petition seeking to change the automatic Class III designation of a novel post-amendment device under Section 513(f)(3) of the FDCA.

As an alternative to the De Novo classification process, the manufacturer could file a reclassification petition seeking to change the automatic Class III designation of a novel post-amendment device under Section 513(f)(3) of the FDCA.

The FDA can also initiate reclassification of an existing device type on its own initiative, and it recently issued a final rule to clarify the administrative process through which the agency reclassifies a medical device.

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In April 2020, FDA published another final guidance entitled “Developing and Labeling In Vitro Companion Diagnostic Devices for a Specific Group or Class of Oncology Therapeutic Products” that expands on the idea of a class of therapeutic products.

The more recent guidance describes considerations for the development and labeling of in vitro companion diagnostic devices to support the indicated uses of multiple drug or biological oncology products, when appropriate.

The latter guidance describes considerations for the development and labeling of in vitro companion diagnostic devices to support the indicated uses of multiple drug or biological oncology products, when appropriate.

The FDA expects that the therapeutic sponsor will address the need for an approved or cleared IVD companion diagnostic device in its therapeutic product development plan and that, in most cases, the therapeutic product and its corresponding IVD companion diagnostic will be developed contemporaneously.

To that end, the FDA has also issued draft guidance entitled “Principles for Codevelopment of an In Vitro Companion Diagnostic Device with a Therapeutic Product” to serve as a practical guide to assist therapeutic product sponsors and IVD sponsors in developing a therapeutic product and an accompanying IVD companion diagnostic, as well as final guidance entitled “Developing and Labeling In Vitro Companion Diagnostic Devices for a Specific Group or Class of Oncology Therapeutic Products” to facilitate class labeling on diagnostic tests for oncology therapeutic products.

The FDA has indicated that it will apply a risk-based approach to determine the regulatory pathway for IVD companion diagnostic devices, as it does with all medical devices.

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There will also be a greater emphasis on post-market surveillance and submission of post-market performance follow-up reports.

Due to multiple challenges to IVD manufacturers being ready for full application by the May 2022 implementation date, Regulation (EU) 2022/112 of the Parliament and of the Council was published on January 25, 2022 allowing for a delay to the application of the IVDR by amending the transition provision for certain in vitro diagnostic medical devices.

For products classified as Class C under the IVDR, the transition period allows for legacy devices with a valid declaration of conformity drawn up prior to May 26, 2022 to continue to be placed on the market until May 26, 2026.

On January 23, 2024, the European Commission announced proposals to further extend the IVDR transition provisions in order to ensure availability of IVDs.

Under the proposal, the transition period in the IVDR will be extended to December 2028 for Class C high individual and/or moderate public health risk devices.

Medical devices certified under the Directive may benefit from the extension provided they meet certain conditions (i.e., continue to comply with the Directive, not be the subject of significant changes on design or intended purpose, etc.).

The proposal needs to be adopted by the European Parliament and Council before it enters into force.

Due to multiple challenges to IVD manufacturers being ready for full application by the May 2022 implementation date, risk of shortages and limited Notified Body capacity, transition periods have been revised several times for legacy devices.

The last revision took place by Regulation (EU) 2024/1860 in July 2024.

For example, products classified as Class C under the IVDR, which were not subject to a Notified Body conformity assessment under the Directive and have a valid declaration of conformity drawn up prior to May 26, 2022, can continue to be placed on the market until December 31, 2028.

Medical devices certified under the Directive may benefit from the extension provided they meet certain conditions ((i) continue to comply with the Directive, (ii) not be the subject of significant changes on design or intended purpose, (iii) not present an unacceptable health or safety risk, (iv) the manufacturer has in place a quality management system according to the IVDR rules before May 26, 2025, and (v) the manufacturer has applied to a Notified Body and has signed a written agreement for a conformity assessment under the IVDR rules by a certain date, depending on the risk class of the IVD).

Certain IVDR requirements, including post-market surveillance, market surveillance, vigilance, and registration of economic operators and devices remained effective on the May 26, 2022 implementation date.

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Companies wishing to place IVDs on the UK market are also required to register with MHRA and have to appoint a UK Responsible Person to manage their compliance efforts in the UK, but are still able to sell CE-IVD marked products in Great Britain.

From approximately July 2025, new legislation will apply in the UK to better align with the IVDR and other international requirements, including requirements for the new marking called a UK Conformity Assessed mark (UKCA).

The UK is currently developing new legislation in the UK to better align with the IVDR and other international requirements, including requirements for the new marking called a UK Conformity Assessed mark (UKCA).

This mark, which can be obtained now, is not recognized in EU countries, meaning that companies that wish to sell in the UK and the EU will have to seek both a UKCA and CE-IVD mark in the future.

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The revision in May 2022 created the fast track approval of IVDs conditional or time-limited approval in emergency situations when the efficacy of medical product is presumed, subject to safety confirmation.

The Ministry of Health, Labour and Welfare will start discussion in May 2024 on the upcoming revision of the Pharmaceuticals and Medical Devices Act, which includes a reform of sales system of the medical products which may include IVDs.

The Ministry of Health, Labour and Welfare started discussion in May 2024 on the upcoming revision of the Pharmaceuticals and Medical Devices Act, such discussion includes a reform of sales system of medical products which may include IVDs as well as a review of performance evaluation based on the characteristics of IVDs (introduction of a system similar to the re-evaluation system for pharmaceuticals).

Additional International Regulation

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Required breach notices must be made as soon as is reasonably practicable, but no later than 60 days following discovery of the breach.

Reports must be made to affected individuals and to the Secretary and, in some cases depending on the size and impact of the breach, they must be reported through local and national media.

Reports must be made to affected individuals and to the Secretary and, in some cases depending on the size and impact of the breach, they must be reported through local and national news media.

Breach reports can lead to investigation, enforcement, civil monetary penalties and civil litigation, including class action lawsuits and enforcement by state authorities as well as significant reputational harm.

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In the event of a breach, even if we mitigate harm and make required reports on a timely basis, we may still be subject to penalties for the underlying breach.

In addition to the federal privacy and security regulations, there are a number of state laws regarding the privacy and security of health information and personal data that can be applicable to our clinical laboratories, as further discussed in the "Risk Factor" section below.

Other federal and state laws establish additional requirements for protecting the privacy and security of health information that is not protected by HIPAA.

For instance, Washington state recently passed the “My Health My Data” Act, which will regulate “consumer health data,” which is defined as “personal information that is linked or reasonably linkable to a consumer and that identifies a consumer’s past, present, or future physical or mental health.” The “My Health My Data” Act provides exemptions for personal data used or shared in connection with certain research activities, including data subject to 45 C.F.R.

Parts 46, 50 and 56.

Notably, the “My Health My Data” Act contains a private right of action.

In addition, Nevada recently enacted a consumer health data privacy bill, SB 370, which also regulates “consumer health data” and shares many similarities with Washington’s “My Health My Data” Act, and Connecticut recently amended its comprehensive privacy law to include heightened regulation of “consumer health data.” Additional states may adopt health-specific privacy laws that could impact our business activities and our collection and handling of health-related data.

In addition to the federal privacy and security regulations and health privacy law referenced above, there are a number of state laws regarding the privacy and security of health information and personal data that can be applicable to our clinical laboratories, as further discussed in the "Risk Factors" section below.

Many states have also implemented genetic testing laws imposing specific patient consent requirements and protecting genetic information by limiting the use and disclosure of such information.

State requirements are particularly stringent regarding predictive genetic tests, due to the risk of genetic discrimination against healthy patients identified through testing as being at risk for disease.

Compliance with health information privacy and security statutes and regulations, including genetic testing and genetic information privacy laws in all jurisdictions, both state and federal, can be challenging as these laws often change, and we may not be able to maintain compliance in all jurisdictions where we do business.

Compliance with health information privacy and security statutes and regulations, including genetic testing and genetic information privacy laws in all jurisdictions, both state and federal, can be challenging as these laws often change, overlap and conflict and we may not be able to maintain compliance in all jurisdictions where we do business.

Transparency Laws and Regulations

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Since December 2019, Congress has passed a series of laws to modify PAMA’s statutory requirements related to the data reporting period and phase-in of payment reductions under the CLFS for CDLTs that are not ADLTs.

Most recently, the Further Continuing Appropriations and Other Extensions Act of 2024 (Pub.L.

118-22, enacted on November, 16, 2023) further delayed the reporting requirement as well as the application of the 15% phase-in reduction.

Under these statutory provisions, the next data reporting period for CDLTs that are not ADLTs will be January 1, 2025 through March 31, 2025, and will be based on the most recent data collection period of January 1, 2019 through June 30, 2019.

After this data reporting period, the three-year data reporting cycle for these tests will resume (e.g., 2028, 2031, etc.).

Most recently, the Continuing Appropriations and Extensions Act, 2025 (Pub.L.

118-83, enacted on September 26, 2024) further delayed the reporting requirement as well as the application of the 15% phase-in reduction.

Under these statutory provisions, the next data reporting period for CDLTs that are not ADLTs will be January 1, 2026 through March 31, 2026, and will be based on the original data collection period of January 1, 2019 through June 30, 2019.

After this data reporting period, the three-year data reporting cycle for these tests will resume.

CMS’s methodology under PAMA (as well as the willingness of commercial insurers to recognize the value of diagnostic testing and pay for that testing accordingly) renders commercial insurer payment levels even more significant.

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For example, for 2018 through 2020, a test price could not be reduced by more than 10% per year.

The same series of laws modified the phase-in of payment reductions resulting from private payor rate implementation so that a 0.0 percent reduction limit was applied for calendar years 2021 through 2023, as compared to the payment amounts for a test the preceding year.

The Further Continuing Appropriations and Other Extensions Act of 2024 further applied a 0.0 percent reduction limit for calendar year 2024.

Consequently, payment may not be reduced by more than 15 percent per year for calendar years 2025 through 2027 as compared to payment amount established for a test the prior year.

The subsequent data reporting period for CDLTs that are not ADLTs will occur in three-year cycles, with the next cycle beginning in 2025.

The same series of laws discussed above modified the phase-in of payment reductions resulting from private payor rate implementation so that a 0.0 percent reduction limit was applied for calendar years 2021 through 2024.

The Further Continuing Appropriations and Extensions Act, 2025 further applied a 0.0 percent reduction limit for calendar year 2025.

Consequently, payment may not be reduced by more than 15 percent per year for calendar years 2026 through 2028 as compared to the payment amount established for a test the prior year.

Given the many uncertainties built into PAMA’s price-setting process, we cannot predict how payments we receive under the CLFS, and thus our revenue, may change from year to year.

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These vendors are licensed or otherwise qualified to handle and dispose of such waste.

In addition, our advertising for laboratory services using FDA-cleared or approved IVDs as well as services using LDTs that are not FDA-approved is subject to federal truth-in-advertising laws enforced by the Federal Trade Commission (FTC), as well as certain state laws.

In addition, our advertising for laboratory tests using FDA-cleared or approved IVDs as well as LDTs that are not FDA-approved is subject to federal truth-in-advertising laws enforced by the Federal Trade Commission (FTC), as well as certain state laws.

Under the Federal Trade Commission Act, or FTC Act, the FTC is empowered, among other things, to prevent unfair methods of competition and unfair or deceptive acts or practices in or affecting commerce.

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

What changed 10-K

Item 1. Business