What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2025-02-28 compared with 2024-02-28 · 274 added, 433 removed, 671 unchanged (51% of the section changed)

32 unchanged sentences

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

Measurement of testing revenue

Description of the Matter During the year ended December 31, 2023, the Company’s testing revenue was $753.2 million.

As discussed in Note 1 of the consolidated financial statements, management estimates the expected amount of consideration to be received as testing revenue and revenue is recognized when the performance obligation is complete.

Auditing the measurement of the Company’s testing revenue was complex and judgmental due to the significant estimation required in determining the amount that will be collected for each test.

In particular, the estimate of revenue is affected by assumptions related to payors such as changes in payor mix, payor collections, current customer contractual requirements, and experience with ultimate collection from third-party payors.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s revenue recognition process.

For example, we tested controls over management’s review of the significant assumptions above and inputs used in calculating the estimated amount that would be collected for each test and tested management’s controls to compare actual payments received to previously forecasted activity.

We also tested controls used by management to compare the current and historical data used in making the estimates for completeness and accuracy.

Our audit procedures over the Company’s testing revenue included, among others, assessing valuation methodologies and models and testing the significant assumptions above and the underlying data used by the Company in its analysis.

We agreed transactions selected for testing back to the actual customer contract terms.

We compared the significant assumptions above and inputs used by management to changes in the Company’s contracted rates, third-party payor collection trends, and other relevant factors.

We assessed the historical accuracy of the cash collections used in the Company’s revenue models, and assessed the completeness of adjustments to estimates of future cash collections as a result of significant contract amendments, changes in collection trends and changes in payor behavior.

Measurement of revenue

Description of the Matter During the year ended December 31, 2024, the Company’s revenue was $837.6 million.

As discussed in Note 1 of the consolidated financial statements, management estimates the expected amount of consideration to be received as revenue and revenue is recognized when the performance obligation is complete.

Auditing the measurement of the Company’s revenue was complex and judgmental due to the significant estimation required in determining the amount that will be collected for each test.

In particular, the estimate of revenue is affected by assumptions related to payors such as changes in payor mix, historical and current payment trends and other changes in payor behavior.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls that address the risks of material misstatement relating to the measurement of revenue related to tests performed.

Our procedures included testing controls over management’s review of the significant assumptions and inputs used in calculating the estimated amounts to be collected for tests performed.

We also tested controls used by management to evaluate the current and historical data used in making the estimates for completeness and accuracy.

Our audit procedures over the Company’s revenue included, among others, assessing the methodologies used to estimate consideration expected to be received for tests performed and testing the significant assumptions and the underlying data used by the Company in its analysis.

We compared the significant assumptions used by management to third-party payor collection trends and other relevant factors.

We assessed the reasonableness of adjustments to estimates of future cash collections as a result of changes in historical and current collection trends and changes in payor behavior.

Additionally, we tested management’s supporting calculations.

We also performed an evaluation of actual cash collections versus expectations to assess the accuracy of estimates made in prior periods.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 2006.

Salt Lake City, UT

Salt Lake City, Utah

February 28, 2025

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Operating lease right-of-use assets 55.0 61.6

Long-term marketable investment securities — 54.8

Property, plant and equipment, net 117.4 119.0

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2024 2023 2022

Testing revenue $ 753.2 $ 678.4 $ 666.4

Other revenue — — 24.2

Total revenue 753.2 678.4 690.6

Costs and expenses:

Cost of testing revenue 236.2 202.0 185.7

Cost of other revenue — — 11.9

$ 837.6 $ 753.2 $ 678.4

Cost of revenue

252.2 236.2 202.0

585.4 517.0 476.4

Operating expenses:

Research and development expense 113.4 88.7 85.4

Selling, general, and administrative expense 572.9 514.7 537.8

Sales and marketing expense 284.1 289.2 266.8

General and administrative expense 275.9 283.7 247.9

Legal settlements

( 21.3 ) 112.8 —

Goodwill and long-lived asset impairment charges 56.8 — 16.9

Total costs and expenses 1,010.6 819.0 881.1

Total operating expenses

708.9 774.4 617.0

Operating loss ( 123.5 ) ( 257.4 ) ( 140.6 )

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Other 1.1 ( 4.4 ) 0.6

Total other income (expense) ( 4.8 ) — 133.4

Total other expense

Loss before income tax ( 123.5 ) ( 262.2 ) ( 140.6 )

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stockholders $ ( 127.3 ) $ ( 263.3 ) $ ( 112.0 )

Change in unrealized loss on available-for-sale securities, net of tax

1.2 ( 2.5 ) ( 1.0 )

Change in unrealized loss on available-for-sale debt securities, net of tax 0.1 1.2 ( 2.5 )

Change in foreign currency translation adjustment, net of tax ( 3.0 ) 2.1 ( 1.3 )

Reclassification adjustments for losses included in net loss, net of tax — 1.5 —

Reclassification of cumulative translation adjustment to income upon liquidation of an investment in a foreign entity, net of tax 0.4 — —

Reclassification of cumulative translation adjustment to income upon sale or liquidation of certain foreign entities, net of tax 5.8 0.4 —

Comprehensive loss $ ( 124.4 ) $ ( 258.1 ) $ ( 115.8 )

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Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax — ( 4.3 ) — — ( 4.3 )

Stock-based payment expense — 36.5 — — 36.5

Stock-based compensation expense — 38.1 — — 38.1

Net loss — — — ( 112.0 ) ( 112.0 )

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Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax — ( 2.8 ) — — ( 2.8 )

Stock-based payment expense — 38.1 — — 38.1

Issuance of common stock for public offering, net 0.1 117.5 — — 117.6

Stock-based compensation expense — 40.7 — — 40.7

Net loss — — — ( 263.3 ) ( 263.3 )

Other comprehensive loss, net of tax — — ( 3.8 ) — ( 3.8 )

Other comprehensive income, net of tax — — 5.2 — 5.2

BALANCES AT DECEMBER 31, 2023 $ 0.9 $ 1,415.5 $ ( 3.7 ) $ ( 629.5 ) $ 783.2

Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax — ( 7.5 ) — — ( 7.5 )

Issuance of common stock for public offering, net 0.1 117.5 — — 117.6

Stock-based payment expense — 40.7 — — 40.7

Stock-based compensation expense — 49.8 — — 49.8

Net loss — — — ( 127.3 ) ( 127.3 )

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CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss attributable to Myriad Genetics, Inc.

stockholders $ ( 263.3 ) $ ( 112.0 ) $ ( 27.2 )

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

Net loss $ ( 127.3 ) $ ( 263.3 ) $ ( 112.0 )

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

Depreciation and amortization 61.2 61.9 52.7

Non-cash lease expense 9.5 11.3 11.7

Loss on termination of lease

Stock-based compensation expense

49.8 40.7 38.1

Deferred income taxes ( 2.8 ) ( 4.0 ) ( 30.8 )

Unrecognized tax benefits 2.5 3.4 ( 1.1 )

Net realized losses on marketable investment securities

Loss on inventory — — 6.5

Impairment of goodwill and long-lived assets 56.6 — 16.9

Gain on sale of businesses and assets — — ( 162.0 )

(Gain) loss on termination of lease

( 3.1 ) 7.7 —

Gain on acquisition ( 2.2 ) — —

Other non-cash adjustments 1.5 4.4 1.7

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Accrued liabilities ( 41.0 ) 27.2 ( 86.2 )

Deferred revenue ( 0.2 ) ( 5.0 ) ( 26.6 )

Net cash provided by (used in) operating activities ( 110.9 ) ( 106.3 ) 18.6

Net cash used in operating activities ( 8.7 ) ( 110.9 ) ( 106.3 )

CASH FLOWS FROM INVESTING ACTIVITIES:

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Capitalization of internal-use software costs ( 10.7 ) ( 10.1 ) —

Proceeds from the sale of business, net cash sold 8.8 — —

Acquisitions, net of cash acquired — — ( 57.2 )

Proceeds from sale of business and assets — — 379.1

Purchases of marketable investment securities — — ( 103.2 )

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Proceeds from common stock issued under stock-based compensation plans 5.9 6.0 6.3

Payment of contingent consideration recognized at acquisition — — ( 3.0 )

Payment of tax withheld for common stock issued under stock-based compensation plans ( 13.4 ) ( 8.8 ) ( 10.6 )

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Proceeds from revolving credit facility 120.0 80.0 —

Fees associated with issuance and refinancing of revolving credit facility

( 1.7 ) ( 0.7 ) ( 1.2 )

Repayment of revolving credit facility ( 119.5 ) ( 40.0 ) —

Payment of contingent consideration recognized at acquisition — ( 3.0 ) ( 3.3 )

Fees associated with issuance and refinancing of revolving credit facility — ( 1.7 ) ( 0.7 )

Payment on finance leases ( 0.4 ) ( 0.2 ) —

Net cash provided by (used in) financing activities ( 7.4 ) 152.9 ( 8.0 )

152.9 ( 8.0 ) ( 150.6 )

Effect of foreign exchange rates on cash, cash equivalents, and restricted cash ( 1.0 ) 0.6 ( 0.6 )

Net increase (decrease) in cash, cash equivalents, and restricted cash

( 29.0 ) 74.5 ( 192.4 )

Cash, cash equivalents, and restricted cash at beginning of the period 140.9 66.4 258.8

Cash, cash equivalents, and restricted cash at end of the period $ 111.9 $ 140.9 $ 66.4

See accompanying notes to consolidated financial statements.

See accompanying notes to the consolidated financial statements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in millions, except per share data)

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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Myriad Genetics, Inc.

(together with its subsidiaries, the "Company" or "Myriad") is a leading genetic testing and precision medicine company dedicated to advancing health and well-being for all.

(together with its subsidiaries, the "Company" or "Myriad") is a leading molecular diagnostic testing and precision medicine company dedicated to advancing health and well-being for all.

Myriad develops and offers 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.

Myriad provides insights that help people take control of their health and enable healthcare providers to better detect, treat, and prevent disease.

Myriad develops and offers genetic 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.

The Company generates revenue by performing tests and, prior to the sale of Myriad RBM, Inc.

on July 1, 2021 as described in Note 17, by providing pharmaceutical and clinical services to the pharmaceutical and biotechnology industries and medical research institutions utilizing its multiplexed immunoassay technology.

The Company currently operates as a single reporting segment.

The Company’s principal executive office is located in Salt Lake City, Utah.

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The preparation of the consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements, as well as the reported amounts of revenue and expenses during the reporting period.

Significant items subject to such estimates and assumptions include revenue recognition estimates for the average expected reimbursement per test, valuation allowances for deferred income tax assets, our incremental borrowing rates used to calculate our lease balances, certain accrued liabilities, stock-based compensation, purchase accounting, and impairment analysis of goodwill and long-lived assets.

Significant items subject to such estimates and assumptions include revenue recognition estimates for the average expected reimbursement per test, valuation allowances for deferred income tax assets, our incremental borrowing rates used to calculate our lease balances, stock-based compensation, purchase accounting, and impairment analysis of goodwill and long-lived assets.

Actual results could differ from those estimates.

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Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable.

The Company limits its exposure to loss by placing its cash in financial institutions with high credit ratings.

The Company's cash consists of deposits held with banks that generally exceed federally insured limits of $250,000 per customer.

Substantially all of the Company’s accounts receivable are with companies in the healthcare industry, U.S.

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and state governments.

The Company does not require collateral from its customers.

The Company only has one payor, Medicare, that represents greater than 10% of its revenues.

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Concentrations of credit risk are mitigated due to the number of the Company’s customers as well as their dispersion across many geographic regions.

The Company has only one payor that accounted for more than 10% of accounts receivable at December 31, 2023.

The balance of accounts receivable from the payor represented 12 % of the total accounts receivable balance as of December 31, 2023.

No payor accounted for more than 10% of accounts receivable at December 31, 2022.

The Company does not require collateral from its customers.

The Company has only one payor that accounted for more than 10% of accounts receivable at December 31, 2024 and 2023.

The balance of accounts receivable from the payor represented 18 % and 12 % of the total accounts receivable balance as of December 31, 2024 and 2023, respectively.

Cash and Cash Equivalents

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The restricted cash amounts are largely comprised of cash held in escrow related to the Company's acquisition of Gateway Genomics, LLC ("Gateway"), which occurred during the year ended December 31, 2022.

The current and long-term portions are included in Prepaid expenses and other current assets and Other assets, respectively, on the Consolidated Balance Sheets.

The current and long-term portions of restricted cash are included in Prepaid expenses and other current assets and Other assets, respectively, on the Consolidated Balance Sheets.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported on the Consolidated Balance Sheets that agrees to the amounts included in the Consolidated Statement of Cash Flows.

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Inventories consist of supplies such as reagents, plates, and testing kits, which are consumed when providing test results, and therefore the Company does not maintain finished goods inventory.

Inventories are stated at the lower of cost or market and costs are determined on a first-in, first-out basis.

Inventories are stated at the lower of cost or net realizable value.

Cost is computed using standard cost, which approximates actual cost on a first-in first-out basis.

The Company evaluates its inventories for excess quantities and obsolescence.

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In order to assess the ultimate realization of inventories, the Company is required to make judgments as to future demand requirements compared to current or committed inventory levels.

The valuation of inventories requires the use of estimates as to the amounts of current inventories that will be sold.

These estimates are dependent on management’s assessment of current and expected orders from the Company’s customers.

Trade Accounts Receivable

Trade accounts receivable represents estimated receivables from customers for revenue recognized related to genetic tests.

Trade accounts receivable represents estimated receivables from customers for revenue recognized related to the Company's tests.

The Company does not have any off-balance-sheet credit exposure related to its customers and does not require collateral.

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Equipment items have depreciable lives of five to seven years .

Leasehold improvements are depreciated over the shorter of the estimated useful lives or the associated lease terms, which range from one to fifteen years .

Leasehold improvements are depreciated over the shorter of the estimated useful lives or the associated lease terms, which range from four to 14 years.

Repairs and maintenance costs are charged to expense as incurred.

The Company acts as the lessee in its lease agreements, which primarily include operating leases for corporate offices, laboratory space, warehouse space, vehicles and certain laboratory and office equipment.

The Company acts as the lessee in its lease agreements, which primarily include operating leases for corporate offices, laboratory space, warehouse space, and certain laboratory and office equipment.

The Company determines whether an arrangement is, or contains, a lease at inception and whether the lease should be classified as a finance or operating lease.

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The lease terms used to calculate the ROU asset and related lease liability include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.

The leases have remaining lease terms of 1 year to 15 years, some of which include options to extend the lease term for up to 10 years.

The leases have remaining lease terms of one year to 14 years, some of which include options to extend the lease term for up to 10 years.

The Company has taken advantage of certain practical expedients offered to registrants at adoption of Accounting Standards Codification ("ASC") 842, Leases .

Lease expense for leases with a term of twelve months or less is recognized on a straight-line basis and is not included in the recognized ROU assets and lease liabilities.

Lease expense for leases with a term of 12 months or less is recognized on a straight-line basis and is not included in the recognized ROU assets and lease liabilities.

Further, as a practical expedient, all lease contracts are accounted for as one single lease component, as opposed to separating lease and non-lease components to allocate the consideration within a single lease contract.

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Costs incurred during the post implementation stage of the project are expensed as incurred.

As of December 31, 2023, the Company had unamortized internal-use software costs of $ 11.9 million.

As of December 31, 2024 and 2023, the Company had unamortized internal-use software costs of $ 22.7 million and $ 11.9 million, respectively.

For the years ended December 31, 2024, 2023, and 2022 amortization expense for these capitalized software costs was insignificant.

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The Company continually reviews and monitors long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset.

If the carrying amount of an asset exceeds its estimated future undiscounted cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset.

If such indicators are present, the Company performs a recoverability test by comparing the estimated undiscounted future cash flows expected to be generated by the asset or asset group to its carrying amount.

If the carrying amount of an asset or asset group exceeds its estimated future undiscounted cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset or asset group.

Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell.

The Company capitalizes certain costs incurred to develop internal-use technology, including certain implementation costs incurred in cloud computing arrangements and hosting arrangements.

The Company capitalizes certain implementation costs incurred in cloud computing arrangements and hosting arrangements.

The Company's cloud computing arrangements or hosting arrangements are primarily service contracts related to information technology.

Implementation and development costs for internal-use technology are capitalized as part of Other assets in the Consolidated Balance Sheets.

As of December 31, 2023 and 2022, the Company had unamortized internal-use technology costs of $ 4.6 million and $ 7.1 million, respectively, within Other assets.

For the years ended December 31, 2023, 2022 and 2021, amortization expense for these capitalized internal-use technology was insignificant.

Implementation and development costs for cloud computing arrangements or hosting arrangements are capitalized as part of Other assets in the Consolidated Balance Sheets.

As of December 31, 2024 and 2023, the Company had unamortized cloud computing arrangements or hosting arrangements of $ 3.4 million and $ 4.6 million, respectively, within Other assets.

For the years ended December 31, 2024, 2023, and 2022, amortization expense for these capitalized amounts was insignificant.

Goodwill is tested for impairment by reporting unit on an annual basis as of October 1 and in the interim if events and circumstances indicate that goodwill may be impaired.

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If an event occurs that would cause a revision to the estimates and assumptions used in analyzing the value of the goodwill, the revision could result in a non-cash impairment charge that could have a material impact on the financial results.

Business Acquisitions

Business Acquisitions/Divestitures

The Company accounts for acquisitions of entities that include inputs and processes and have the ability to create outputs as business combinations.

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Any excess purchase price over the estimated fair value assigned to the net tangible and identifiable intangible assets acquired and liabilities assumed is recorded to goodwill.

The use of alternative valuation assumptions, including estimated revenue projections, growth rates, estimated cost savings, cash flows, discount rates, estimated useful lives and probabilities surrounding the achievement of contingent milestones could result in different purchase price allocations and amortization expense in current and future periods.

To the extent the fair value of the net assets and liabilities acquired exceeds the purchase price, a gain is recognized.

In circumstances where an acquisition involves a contingent consideration arrangement that meets the definition of a liability under ASC 480, Distinguishing Liabilities from Equity , the Company recognizes a liability equal to the fair value of the contingent payments expected to be made as of the acquisition date.

This liability is remeasured each reporting period and the changes in the fair value are recognized in Selling, general, and administrative expenses in the Consolidated Statements of Operations.

Transaction costs associated with acquisitions are expensed as incurred in Selling, general, and administrative expenses in the Consolidated Statements of Operations.

This liability is remeasured each reporting period and the changes in the fair value are recognized in General and administrative expenses in the Consolidated Statements of Operations.

The Company evaluates its portfolio of businesses on an ongoing basis to ensure alignment with its strategic objectives and to enhance shareholder value.

From time to time, the Company may divest certain businesses, product lines, or other non-core assets.

Gains or losses from the sale of businesses or assets are included in Goodwill and long-lived asset impairment charges on the Company’s Consolidated Statements of Operations.

See Note 16 for further information.

Transaction costs associated with acquisitions are expensed as incurred in General and administrative expenses in the Consolidated Statements of Operations.

Results of operations and cash flows of acquired companies are included in the operating results from the date of acquisition.

Revenue Recognition

The Company primarily generates revenue by performing genetic testing.

Testing revenues are primarily derived from the following categories of products:

Hereditary Cancer (MyRisk, BRACAnalysis, BRACAnalysis CDx), Tumor Profiling (MyChoice CDx, Prolaris, and EndoPredict), Prenatal (Foresight, Prequel, and SneakPeek), and Pharmacogenomics (GeneSight).

The Company previously provided pharmaceutical and clinical services prior to the sale of Myriad RBM, Inc.

in July 2021.

Prior to the sale of the Myriad myPath, LLC laboratory in May 2021 and the Myriad Autoimmune business in September 2021, the associated revenue from such businesses was included within Testing revenues.

See Note 17 for a discussion of these divestitures.

The Company primarily generates revenue by performing molecular testing, primarily derived from the following categories of products:

Hereditary Cancer (MyRisk and BRACAnalysis CDx), Tumor Profiling (MyChoice CDx, Prolaris, Precise Tumor, and EndoPredict), Prenatal (Foresight, Prequel, and SneakPeek), and Pharmacogenomics (GeneSight).

Revenue is recorded at the estimated transaction price.

The Company has determined that the communication of test results or the completion of pharmaceutical and clinical services indicates transfer of control for revenue recognition purposes.

Control is transferred, and revenue is recognized, once test results are released to the healthcare provider and/or patient.

The following table presents detail regarding the composition of the Company’s total revenue by product type for the years ended December 31, 2024, 2023, and 2022:

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(In millions) 2024 2023 2022

Testing revenues:

Hereditary Cancer $ 364.5 $ 327.8 $ 305.5

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Autoimmune — — 0.3

Other — — 0.5

Total testing revenue 753.2 678.4 666.4

Other revenue — — 24.2

Total revenue

$ 837.6 $ 753.2 $ 678.4

In addition, the following tables reconcile revenue by geographical region, either U.S.

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RoW Total U.S.

Testing revenues:

Hereditary Cancer $ 318.6 $ 45.9 $ 364.5 $ 280.5 $ 47.3 $ 327.8 $ 263.5 $ 42.0 $ 305.5

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Autoimmune — — — — — — 0.3 — 0.3

Other — — — — — — — 0.5 0.5

Total testing revenue 671.7 81.5 753.2 591.5 86.9 678.4 579.5 86.9 666.4

Other revenue — — — — — — 24.2 — 24.2

Total revenue

$ 769.5 $ 68.1 $ 837.6 $ 671.7 $ 81.5 $ 753.2 $ 591.5 $ 86.9 $ 678.4

Under ASC 606, Revenue from Contracts with Customers (“ASC 606”), an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

The Company performs its obligation under a contract with a customer by processing tests and communicating the test results to customers, in exchange for consideration from the customer.

The Company performs its obligation under a contract with a customer by processing tests and releasing the test results to customers, in exchange for consideration from the customer.

The Company has the right to bill its customers upon the completion of performance obligations and thus does not record contract assets.

Occasionally, customers make payments prior to the Company's performance of its contractual obligations.

When this occurs, the Company records a contract liability as Deferred revenue, which is included in Accrued liabilities in the Consolidated Balance Sheets.

A reconciliation of the beginning and ending balances of deferred revenue is shown in the table below:

Years Ended December 31,

(in millions) 2023 2022 2021

Deferred revenue - beginning balance $ 0.6 $ 5.2 $ 32.7

Revenue recognized ( 0.5 ) ( 4.9 ) ( 40.5 )

Prepayments 0.4 0.3 14.0

Divestitures — — ( 1.0 )

Deferred revenue - ending balance $ 0.5 $ 0.6 $ 5.2

In accordance with ASC 606, the Company has elected not to disclose the aggregate amount of the transaction price allocated to remaining performance obligations for its contracts that are one year or less, as the revenue is expected to be recognized within the next year.

Furthermore, the Company has elected not to disclose the aggregate amount of the transaction price allocated to remaining performance obligations for its agreements wherein the Company’s right to payment is in an amount that directly corresponds with the value of the Company’s performance to date.

In determining the transaction price, the Company includes an estimate of the expected amount of consideration as revenue.

In determining the transaction price, the Company includes an estimate of the expected amount of consideration to be received.

The Company applies this method consistently for similar contracts when estimating the effect of any uncertainty on an amount of variable consideration to which it will be entitled.

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In addition, the Company considers all the information (historical, current, and forecast) that is reasonably available to identify possible consideration amounts.

In determining the expected value, the Company considers the probability of the variable consideration for each possible scenario.

The Company also has significant experience with historical discount patterns and uses this experience to estimate transaction prices.

The estimate of revenue is affected by assumptions in payor behavior such as changes in payor mix, payor collections, current customer contractual requirements, and experience with collections from third-party payors.

The estimate of revenue is affected by, among other factors, assumptions for changes in payor mix, payor collections, current customer contractual requirements, experience with collections from third-party payors, and changes in medical policies.

When assessing the total consideration for insurance carriers and patients, revenues are further constrained for estimated refunds.

The Company reserves certain amounts in Accrued liabilities in the Consolidated Balance Sheets in anticipation of requests for refunds of payments made previously by insurance carriers, which are accounted for as reductions in revenues in the Consolidated Statements of Operations and Comprehensive Loss.

Cash collections for certain tests delivered may differ from rates estimated, primarily driven by changes in the estimated transaction price due to contractual adjustments, obtaining updated information from payors and patients that was unknown at the time the performance obligation was met and settlements with third-party payors.

The Company reserves certain amounts in Accrued liabilities in the Consolidated Balance Sheets in anticipation of requests for refunds of payments made previously by insurance carriers, which are accounted for as reductions in revenue in the Consolidated Statements of Operations and Comprehensive Loss.

Cash collections for certain tests delivered may differ from rates estimated due to changes in the estimated transaction price for contractual adjustments, obtaining updated information from payors and patients that was unknown at the time the performance obligation was met, settlements with third-party payors, or as a result of third-party payors disputing our bills or denying payment for tests that we have performed, among other reasons.

As a result of this new information, the Company updates its estimate of the amounts to be recognized for previously delivered tests.

During the year ended December 31, 2023, the Company recognized $ 7.2 million in revenue, which resulted in a $ 0.07 impact to loss per share for tests in which the performance obligation of delivering the test results was met in prior periods.

During the year ended December 31, 2022, the Company recognized $ 22.1 million in revenue which resulted in a $ 0.21 impact to loss per share for tests in which the performance obligation of delivering the test results was met in prior periods.

During the year ended December 31, 2021, the Company recognized $ 15.9 million in revenue which resulted in a $ 0.15 impact to loss per share for tests in which the performance obligation of delivering the test results was met in prior periods.

Additionally, during the year ended December 31, 2021, revenue of $ 6.8 million was recognized due to expanded coverage for the Company's Prolaris test, for which revenue was fully constrained in a prior period.

The Company recognized $ 18.5 million, $ 7.2 million, and $ 22.1 million for the years ended December 31, 2024, 2023, and 2022, respectively, for tests in which the performance obligation of delivering the test results was met in prior periods.

The changes for all periods presented were primarily driven by changes in the estimated transaction price.

Additionally, for the year ended December 31, 2024, the Company recognized $ 3.0 million in revenue due to a retroactive coverage change by a payor for one of the Company's prenatal products.

In accordance with ASC 606, the Company has elected to exclude from the measurement of transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the Company from a customer for sales tax, value added tax, and certain other taxes.

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Accordingly, no costs incurred to obtain or fulfill a contract have been capitalized.

The Company also applies the practical expedient for not adjusting revenue recognized for the effects of the time value of money.

This practical expedient has been elected because the Company collects very little cash from customers under payment terms and the vast majority of payment terms have a payback period of less than one year.

Advertising Costs

The Company expenses advertising costs as incurred.

The Company incurred advertising costs of $ 10.3 million, $ 8.5 million, and $ 5.3 million for the years ended December 31, 2024, December 31, 2023, and December 31, 2022, respectively.

Stock-based Payment Expense

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The expected volatility is determined using the weighted average of daily historical volatility of the price of the Company's common stock.

Other Income (Expense)

The Company recognizes the gain or loss on its divestitures as Other income (expense) in the Consolidated Statement of Operations.

See Note 17 for additional information regarding these divestitures.

The Company recognizes income taxes under the asset and liability method.

This approach requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities.

The provision for income taxes, including the effective tax rate and analysis of potential tax exposure items, if any, requires significant judgment and expertise in federal, state, and foreign income tax laws, regulations and strategies, including the determination of deferred tax assets and liabilities and any estimated valuation allowances deemed necessary to recognize deferred tax assets at an amount that is more likely than not to be realized.

The provision for income taxes, including the effective tax rate and analysis of potential tax exposure items requires significant judgment and expertise in federal, state, and foreign income tax laws, regulations and strategies, including the determination of deferred tax assets and liabilities and any estimated valuation allowances deemed necessary to recognize deferred tax assets at an amount that is more likely than not to be realized.

The Company’s filings, including the positions taken therein, are subject to audit by various taxing authorities.

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Period translation adjustments ( 3.0 )

Reclassification of cumulative translation adjustment to income upon liquidation of an investment in a foreign entity 0.4

Reclassification of cumulative translation adjustment to income upon sale or liquidation of certain foreign entities, net of tax 5.9

Ending balance December 31, 2024

During the years ended December 31, 2023 and 2022, the Company recognized a gain (loss) related to foreign currency of $( 3.4 ) million and $ 0.2 million, respectively, which is included in Other in the Consolidated Statements of Operations.

During the years ended December 31, 2024 and 2023, the Company recognized losses related to foreign currency of $ 1.1 million and $ 3.4 million, respectively, which is included in Other in the Consolidated Statements of Operations.

Recent Accounting Pronouncements

In November 2023, the FASB issued accounting standards update ("ASU") 2023-07, which enhances the disclosures required for reportable segments in annual and interim consolidated financial statements.

ASU 2023-07 is effective for the Company for annual reporting periods beginning after December 15, 2023 and for interim periods within fiscal years December 15, 2024.

Early adoption is permitted.

The Company is currently evaluating the impact of ASU 2023-07 on its segment disclosures.

In December 2023, the FASB issued ASU 2023-09, which requires enhanced income tax disclosures, including disaggregation of information on the rate reconciliation table and disaggregated information related to income taxes paid.

Recently Adopted Standards

In November 2023, the Financial Accounting Standards Board ("FASB") issued accounting standards update ("ASU") 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures , which enhances the disclosures required for reportable segments in annual and interim consolidated financial statements.

ASU 2023-07 is effective for the Company for annual reporting periods beginning after December 15, 2023 and for interim periods within fiscal years beginning after December 15, 2024.

The Company has adopted the required disclosures effective for the year ended December 31, 2024.

The Company has identified consolidated net income (loss) as the measure of segment profitability.

The significant expenses presented to the chief operating decision maker ("CODM") are at the same level as presented in Consolidated Statement Operations in these financial statements.

Standards Effective in Future Years and Not Yet Adopted

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

Improvements to Income Tax Disclosures , which requires enhanced income tax disclosures, including disaggregation of information on the rate reconciliation table and disaggregated information related to income taxes paid.

The amendments in ASU 2023-09 are effective for annual periods beginning after December 15, 2024.

The Company is currently evaluating the impact of ASU 2023-09 on its income tax disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses , requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis.

ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted.

The Company is currently evaluating the impact of adopting ASU 2024-03.

MARKETABLE INVESTMENT SECURITIES

The amortized cost, gross unrealized holding gains, gross unrealized holding losses, and fair value for debt securities classified as available-for-sale securities by major security type and class of security at December 31, 2023 and December 31, 2022 were as follows:

(in millions) Amortized

losses Estimated

December 31, 2023:

Cash and cash equivalents:

Cash $ 129.9 $ — $ — $ 129.9

Cash equivalents 2.2 — — 2.2

Total cash and cash equivalents 132.1 — — 132.1

Available-for-sale:

Corporate bonds and notes 8.4 — ( 0.1 ) 8.3

Municipal bonds 0.5 — — 0.5

Total $ 141.0 $ — $ ( 0.1 ) $ 140.9

At December 31, 2024, the Company had no investment securities outstanding.

As of December 31, 2023, the Company had no gross unrealized holding gains.

The amortized cost, gross unrealized holding losses, and fair value for debt securities classified as available-for-sale securities by major security type and class of security at December 31, 2023 were as follows:

(in millions) Amortized

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Municipal bonds 0.5 — 0.5

Federal agency issues 20.7 — ( 0.7 ) 20.0

government securities 11.8 — ( 0.1 ) 11.7

Total $ 141.0 $ ( 0.1 ) $ 140.9

Cash, cash equivalents, and maturities of debt securities classified as available-for-sale were as follows at December 31, 2023:

(in millions) Amortized

cost Estimated

Cash $ 129.9 $ 129.9

Cash equivalents 2.2 2.2

Available-for-sale:

Due within one year 8.9 8.8

Total $ 141.0 $ 140.9

During the years ended December 31, 2023, 2022, and 2021, the Company sold $ 90.4 million, $ 28.4 million, and $ 8.3 million of investments, respectively.

During the years ended December 31, 2023 and 2022, the Company sold $ 90.4 million and $ 28.4 million of investments, respectively.

The cost of the available for sale security sold was determined using the specific-identification method.

The amount of gross realized gains and realized losses upon sales of investments was $ 1.5 million for the year ended December 31, 2023 and was insignificant for the years ended December 31, 2022 and 2021.

As of December 31, 2023, the Company had 7 available-for-sale debt securities in a gross unrealized loss position of $ 0.1 million, with a fair market value of $ 8.8 million.

As of December 31, 2022, the Company had 118 available-for-sale debt securities in a gross unrealized loss position of $ 2.7 million, with a fair market value of $ 111.6 million.

As of December 31, 2023 and 2022, the expected losses were determined to be immaterial and as such, the Company did not record an allowance for credit losses.

The Company does not intend to sell these available-for-sale debt securities, and it is not more likely than not that it will be required to sell these securities prior to recovery of their amortized cost basis.

The amount of gross realized gains and realized losses upon sales of investments was insignificant for the year ended December 31, 2024 and December 31, 2022.

The amount of realized losses upon sales of investments was $ 1.5 million for the year ended December 31, 2023.

As of December 31, 2023, the Company had seven available-for-sale debt securities in a gross unrealized loss position of $ 0.1 million, with a fair market value of $ 8.8 million.

As of December 31, 2023, the expected losses were determined to be immaterial and as such, the Company did not record an allowance for credit losses.

Additional information relating to fair value of marketable investment securities can be found in Note 3.

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or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Some of the Company’s marketable securities primarily utilize broker quotes in a non-active market for valuation of these securities.

Some of the Company’s marketable securities primarily utilized broker quotes in a non-active market for valuation of these securities.

Level 3—unobservable inputs.

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For Level 2 securities, the Company uses a third-party pricing service which provides documentation on an ongoing basis that includes, among other things, pricing information with respect to reference data, methodology, inputs summarized by asset class, pricing application, and corroborative information.

For Level 3 contingent consideration related to the acquisitions of Sividon Diagnostics GmbH ("Sividon") and Gateway, the Company reassesses the fair value of each expected contingent consideration and the corresponding liability each reporting period using the Monte Carlo Method, which is consistent with the initial measurement of the expected contingent consideration liability.

This fair value measurement is considered a Level 3 measurement because the Company estimates projections during the expected measurement periods of approximately 11.5 and 1.3 years for Sividon and Gateway, respectively, utilizing various potential pay-out scenarios.

During the year ended December 31, 2023, the previously recognized contingent consideration liability related to the acquisition of Gateway, which was $ 2.1 million as of December 31, 2022, was released due to the revised forecasts and the results of the Monte Carlo valuation.

Probabilities were applied to each potential scenario and the resulting values were discounted using a rate that considers weighted average cost of capital as well as a specific risk premium associated with the riskiness of the contingent consideration itself, the related projections, and the overall business.

The contingent consideration liabilities are classified as components of Accrued liabilities and Other long-term liabilities in the Consolidated Balance Sheets.

Changes to contingent consideration liabilities are reflected in Selling, general, and administrative expense in the Consolidated Statements of Operations.

Changes to the unobservable inputs could have a material impact on the Company’s financial statements.

The fair value of the Company’s long-term debt, which it considers a Level 2 measurement, is estimated using discounted cash flow analyses, based on the Company’s current estimated incremental borrowing rates for similar borrowing arrangements.

The fair value of the Company’s long-term debt, which it considers a Level 2 measurement, is estimated using a discounted cash flow analysis, based on the Company’s current estimated incremental borrowing rates for similar borrowing arrangements.

The fair value of the Company’s long-term debt is estimated to be $ 40.2 million at December 31, 2024.

The following table sets forth the fair value of the financial assets and liabilities that the Company re-measures on a regular basis:

(in millions) Level 1 Level 2 Level 3 Total

December 31, 2023

Money market funds (a) $ 2.2 $ — $ — $ 2.2

Corporate bonds and notes — 8.3 — 8.3

Municipal bonds — 0.5 — 0.5

Contingent consideration — — ( 5.4 ) ( 5.4 )

Total $ 2.2 $ 8.8 $ ( 5.4 ) $ 5.6

At December 31, 2024, the Company did not have any financial assets or liabilities requiring fair value re-measurement.

The following table sets forth the fair value of the financial assets and liabilities that the Company re-measures on a regular basis as of December 31, 2023:

(in millions) Level 1 Level 2 Level 3 Total

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Municipal bonds — 0.5 — 0.5

Federal agency issues — 20.0 — 20.0

government securities — 11.7 — 11.7

Contingent consideration — — ( 5.4 ) ( 5.4 )

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Carrying amount at end of period $ — $ 5.4 $ 6.8

For the Level 2 contingent consideration related to the acquisition of Gateway, the Company reassesses the fair value of expected contingent consideration and the corresponding liability each reporting period using current financial or operating projections.

As of December 31, 2024, the Company has estimated a fair value of $ 0 related to the Gateway contingent consideration as the achievement of the contingent consideration targets is not considered probable.

PROPERTY, PLANT AND EQUIPMENT, NET

The property, plant and equipment at December 31, 2023 and December 31, 2022 were as follows:

The property, plant and equipment were as follows:

(in millions) 2024 2023

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Property, plant and equipment, net $ 117.4 $ 119.0

During the year ended December 31, 2023, the Company incurred $ 5.7 million of accelerated depreciation of leasehold improvements and equipment in connection with the Company's decision to cease the use of its corporate headquarters in Salt Lake City and transition corporate support operations to its new facility in west Salt Lake City.

During the year ended December 31, 2023, the Company incurred $ 5.7 million of accelerated depreciation of leasehold improvements and equipment in connection with the Company's decision to cease the use of its previous corporate headquarters in Salt Lake City, Utah and transition corporate support operations to its new facility in west Salt Lake City.

The Company formally assigned the previous corporate headquarter lease to a third party as of December 31, 2023.

See Note 13 for further discussion.

During the year ended December 31, 2022, the Company ceased the use of certain leased Salt Lake City facilities and one of its South San Francisco facilities.

As a result, the Company recognized a $ 3.9 million impairment on the property, plant and equipment associated with the leases, which consisted primarily of leasehold improvements.

See Note 13 for further discussion.

The Company recorded depreciation during the respective periods as follows:

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Beginning balance $ 287.4

Goodwill impairment ( 0.8 )

Translation adjustments ( 0.3 )

Carrying amount at end of period $ 287.4

The Company assessed goodwill for impairment as part of its annual goodwill testing in accordance with the appropriate guidance (see Note 1) and determined none of its reporting units were impaired as of the annual testing date.

Ending balance $ 286.3

During the fourth quarter of 2024, UnitedHealthcare announced that it would no longer provide coverage for certain multi-gene panel pharmacogenetic tests, including the Company's GeneSight test, under its commercial, individual exchange, and certain managed Medicaid plans.

The change took effect for commercial and individual exchange plans on January 1, 2025, and is expected to take effect for impacted managed Medicaid plans during the first half of 2025.

As a result, the Company performed an quantitative impairment test for the goodwill for the Pharmacogenomics reporting unit during the fourth quarter of 2024.

The Company also elected to perform a quantitative impairment review of goodwill for its Women's Health and International reporting units.

The Company estimated the fair values of each reporting unit using both the market approach, applying an observable multiple of revenue based on guideline public companies, and the income approach, discounting future cash flows based on management's expectations of the current and future operating environments for each reporting unit.

The Company corroborated the reasonableness of the estimated reporting unit fair values by reconciling the values to its enterprise value and market capitalization.

The goodwill balance at each reporting unit was determined to not be impaired as of December 31, 2024.

During the second quarter of 2024, as a result of the disposition of the EndoPredict business, the Company recognized a goodwill impairment charge of $ 0.8 million for the goodwill allocated to the EndoPredict business within the Company's International reporting unit.

The goodwill impairment charge is reflected in Goodwill and long-lived asset impairment charges in the Consolidated Statements of Operations.

See Note 17 for further discussion.

The Company did no t record an impairment of goodwill for the years ended December 31, 2023 and 2022.

Intangible Assets

The following tables summarize the amounts reported as intangible assets (in millions):

At December 31, 2023:

Carrying Amount Accumulated Amortization Net Weighted-Average Useful Life

The following tables summarize the amounts reported as intangible assets:

(in millions) Gross

Amount Accumulated

Amortization Net Weighted-Average Useful Life

(in Years) Weighted-Average Remaining Useful Life

At December 31, 2024

Developed technologies $ 560.1 $ ( 326.5 ) $ 233.6 10.6 3.6

Internal-use software 1.8 ( 0.7 ) 1.1 3.0 1.9

0.8 ( 0.1 ) 0.7 3.0 2.5

Internal-use software (in-process)

11.2 — 11.2 3.0 3.0

Customer relationships 1.6 ( 0.3 ) 1.3 10.0 7.8

Trademarks 6.1 ( 1.3 ) 4.8 10.0 7.8

Internal-use software (in-process) 21.6 — 21.6

Total intangible assets $ 591.2 $ ( 328.8 ) $ 262.4

At December 31, 2022:

Carrying Amount Accumulated Amortization Net Weighted-Average Useful Life

(in millions) Gross

Amount Accumulated

Amortization Net Weighted-Average Useful Life

(in Years) Weighted-Average Remaining Useful Life

At December 31, 2023

Developed technologies $ 626.1 $ ( 295.3 ) $ 330.8 14.4 8.1

Internal-use software 0.8 ( 0.1 ) 0.7 3.0 2.5

Customer relationships 1.6 ( 0.2 ) 1.4 10.0 8.8

Trademarks 6.1 ( 0.7 ) 5.4 10.0 8.8

Internal-use software (in-process) 11.2 — 11.2

Total intangible assets $ 645.8 $ ( 296.3 ) $ 349.5

$ 632.7 $ ( 253.0 ) $ 379.7 14.4 9.1

As noted above, UnitedHealthcare announced that it would longer provide coverage for certain multi-gene panel pharmacogenetic tests, including the Company's GeneSight test, which triggered the Company to perform a recoverability test for the Pharmacogenomics asset group during the fourth quarter of 2024.

The Company performed the recoverability test by comparing the carrying value of the asset group to its estimated undiscounted future cash flows.

The analysis indicated that the carrying value exceeded the recoverable amount, requiring the Company to determine the fair value of the asset group.

The fair value of the developed technology was determined using a discounted cash flow model.

The primary assumptions used in the discounted cash flow model included projected revenue and profitability associated with the developed technology based on management's forecast and a discount rate reflective of the risk-adjusted cost of capital of 10 %.

As the carrying value for the developed technology asset exceeded the relative fair value, the Company recognized an impairment charge of $ 43.0 million during the year ended December 31, 2024, which is included in " Goodwill and long-lived asset impairment charges " in the Consolidated Statements of Operations.

The impairment reduced the carrying value of the developed technology to its estimated fair value of $ 89.0 million as of the impairment date.

The Company determined there was no impairment of long-lived intangible assets for the years ended December 31, 2023 and 2022.

In recent years, the Company has invested in the development of internal-use software.

As of December 31, 2024, the Company has capitalized $ 21.6 million related to projects under development.

The Company expects the majority of the current in-process internal-use software projects to be completed in fiscal year 2025.

As of December 31, 2024, the Company's developed technologies have estimated remaining useful lives ranging between 5 and 12 years.

The Company's trademarks and customer relationships acquired as of December 31, 2023 have an estimated remaining useful life of approximately nine years .

The Company's internal-use software assets are amortized over the estimated useful life of the software, which is generally three years .

The Company concluded there was no impairment of long-lived intangible assets for the years ended December 31, 2023, 2022 and 2021.

The Company recorded amortization during the respective periods for these intangible assets as follows:

The Company's acquired trademarks and customer relationships have an estimated remaining useful life of approximately 8 years as of December 31, 2024.

The Company's internal-use software assets are amortized over the estimated useful life of the software, which is generally 3 years.

The Company recorded amortization during the respective periods for intangible assets as follows:

Years Ended December 31,

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ACCRUED LIABILITIES

The Company's accrued liabilities at December 31, 2023 and December 31, 2022 were as follows:

Accrued liabilities consist of the following:

(in millions) 2024 2023

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Lease termination accrual 3.8 4.4

Escrow liability

Other accrued liabilities 16.0 20.7

Total accrued liabilities $ 119.0 $ 113.9

Revenue is constrained in anticipation of requests for refunds of payments made previously by insurance carriers.

The following table summarizes the balance and activity of the refunds payable and reserves for the years ended December 31, 2024 and 2023:

Years Ended December 31,

(in millions) 2024 2023

Beginning balance $ 20.1 $ 19.3

Recoupments paid

( 11.3 ) ( 13.8 )

Additions to the reserve

Ending balance $ 19.9 $ 20.1

LONG-TERM DEBT

On June 30, 2023, the Company entered into an asset-based revolving credit facility (the “ABL Facility”) with an initial maximum principal amount of $ 90.0 million, with JPMorgan Chase Bank, N.A.

as administrative agent and issuing bank, the other lender parties thereto, and certain of the Company's domestic subsidiaries (the "Guarantors").

On June 30, 2023, the Company entered into an asset-based revolving credit facility (the “ABL Facility”) with an initial maximum principal amount of $ 90.0 million, with JPMorgan Chase Bank, N.A., as administrative agent and issuing bank, the other lender parties thereto, and certain of the Company's domestic subsidiaries (the "Guarantors").

On October 31, 2023, the Company entered into an amendment to the ABL Facility to increase the maximum principal amount of the available revolving line of credit by $ 25.0 million for a total maximum principal commitment of $ 115.0 million under the ABL Facility, which was effected through a new commitment provided by a new lender, Goldman Sachs Bank USA.

The ABL Facility replaced the Company's previous credit facility and matures on June 30, 2026.

The ABL Facility matures on June 30, 2026.

The obligations of the Company are guaranteed by the Guarantors and the ABL Facility is secured by substantially all of the assets of the Company and the Guarantors.

The Company had long-term debt of $ 38.5 million under the ABL Facility at December 31, 2023, net of $ 1.5 million of debt issuance costs.

The proceeds of the ABL Facility were or will be used for the working capital needs and general corporate purposes of the Company and its subsidiaries, including, without limitation, consummating permitted acquisitions and refinancing existing indebtedness.

Availability under the ABL Facility is subject to a borrowing base, which is the lesser of (a) 85 % of the Company's and the Guarantor's eligible accounts receivable plus certain cash held in a segregated and fully-blocked account with the administrative agent in an amount up to $ 20.0 million ("Eligible Cash") minus any reserves established by the administrative agent in accordance with the ABL Facility, and (b) the aggregate amount of cash collections from eligible accounts of the Company and the Guarantors for the 60 consecutive days most recently ended.

Subject to certain conditions, the Company can freely withdraw cash from the Eligible Cash account, provided that any reduction in the Eligible Cash amount will have a corresponding reduction in the borrowing base.

Loans outstanding under the ABL Facility will bear interest at a rate per annum equal to, at the option of the Company, either (a) the greatest of (i) the daily Prime Rate, (ii) the daily NYFRB Rate plus 0.50 %, and (iii) the monthly Adjusted Term SOFR Rate (as defined below) plus 1.00 % (the “ABR”) plus an applicable margin ranging from 1.00 % to 1.50 % depending on the aggregate average unused availability under the ABL Facility during the prior quarter or (b) term SOFR for a tenor of one, three or six months (at the Company’s election) plus 0.10 % (the “Adjusted Term SOFR Rate”) plus an applicable margin ranging from 2.00 % to 2.50 % depending on the average unused availability under the ABL Facility during the prior quarter, with an ABR floor of 1.00 % and an Adjusted Term SOFR Rate floor of 0.00 %.

The Company had long-term debt of $ 39.6 million and $ 38.5 million under the ABL Facility at December 31, 2024 and December 31, 2023, respectively, net of $ 0.9 million and $ 1.5 million of debt issuance costs, respectively.

Proceeds from the ABL Facility were or will be used for the working capital needs and general corporate purposes of the Company and its subsidiaries.

Availability under the ABL Facility is subject to a borrowing base, which is the lesser of (a) 85 % of the Company's and the Guarantors' eligible accounts receivable plus certain cash held in a segregated and fully-blocked account with the administrative agent in an amount up to $ 20.0 million ("Eligible Cash") minus any reserves established by the administrative agent in accordance with the ABL Facility, and (b) the aggregate amount of cash collections from eligible accounts of the Company and the Guarantors for the 60 consecutive days most recently ended.

Loans outstanding under the ABL Facility will bear interest at a rate per annum equal to, at the option of the Company, either (a) the greatest of (i) the daily Prime Rate, (ii) the daily NYFRB Rate plus 0.5 %, and (iii) the monthly Adjusted Term SOFR Rate (as defined below) plus 1.0 % (the “ABR”) plus an applicable margin ranging from 1.0 % to 1.5 % depending on the aggregate average unused availability under the ABL Facility during the prior quarter or (b) term Secured Overnight Financing Rate ("SOFR") for a tenor of one, three or six months (at the Company’s election) plus 0.1 % (the “Adjusted Term SOFR Rate”) plus an applicable margin ranging from 2.0 % to 2.5 % depending on the average unused availability under the ABL Facility during the prior quarter, with an ABR floor of 1.0 % and an Adjusted Term SOFR Rate floor of 0.0 %.

Under the ABL Facility, the undrawn fee ranges from 37.5 to 50 basis points based on the daily amount of the available revolving commitment.

The weighted average interest rate for borrowings under the ABL Facility as of December 31, 2024 was 7.8 %.

The interest rate for borrowings under the ABL Facility as of December 31, 2023 was 9.75 %.

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The ABL Facility contains customary loan terms, interest rates, representations and warranties and affirmative and negative covenants, in each case, subject to customary limitations, exceptions, and exclusions.

Covenants under the ABL Facility limit or restrict the Company and its subsidiaries' ability to incur liens, incur indebtedness, dispose of assets, make investments, make certain restricted payments, merge or consolidate and enter into certain speculative hedging arrangements.

The ABL Facility requires the Company and the Guarantors, on a consolidated basis, to maintain minimum liquidity of $ 60.0 million and minimum availability of $ 25.0 million at all times before achieving a fixed charge coverage ratio of 1.0 to 1.0 and thereafter, to maintain a fixed charge coverage ratio of 1.0 to 1.0 until achieving availability under the ABL Facility of greater than the greater of (a) $ 10.6 million and (b) 12.5 % of the lesser of the maximum commitment amount and the borrowing base for a period of 30 consecutive days.

Covenants under the ABL Facility limit or restrict the Company and its subsidiaries' ability to incur liens, incur indebtedness, dispose of assets, make investments, make certain restricted payments (including dividends), merge or consolidate, and enter into certain speculative hedging arrangements.

The ABL Facility requires the Company and the Guarantors, on a consolidated basis, to maintain a fixed charge coverage ratio of at least 1.0 to 1.0 if availability under the ABL Facility is less than the greater of (a) $ 10.6 million and (b) 12.5 % of the lesser of the maximum commitment amount and the borrowing base.

As of December 31, 2024, availability under the ABL Facility was $ 56.0 million.

For the years ended December 31, 2024 and December 31, 2023, the Company was compliant with all such financial covenants .

In addition, the ABL Facility includes a number of customary events of default.

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Such cash dominion period will end when availability has remained in excess of the greater of (i) $ 12.5 million and (ii) 15 % of the lesser of the maximum commitment amount and the borrowing base for a period of 45 consecutive days and no event of default is continuing.

The Company had no outstanding balances under the previous credit facility, which was replaced with the ABL Facility, as of December 31, 2022.

OTHER LONG-TERM LIABILITIES

The Company's other long-term liabilities at December 31, 2023 and December 31, 2022 were as follows:

The Company's other long-term liabilities were as follows:

(in millions) 2024 2023

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Total other long-term liabilities $ 2.2 $ 41.3

Contingent consideration as of December 31, 2023 consisted of the long-term portion of contingent consideration related to the acquisition of Sividon.

As of December 31, 2022, contingent consideration consisted of the long-term portion of contingent consideration related to the acquisitions of Sividon and Gateway.

The previously recognized contingent consideration liability related to the acquisition of Gateway is not included in the balance as of December 31, 2023, as it is not probable that the required metrics will be met.

Additionally, a corresponding amount of cash to the escrow liability of $ 7.5 million has been restricted for the potential payment under the indemnity and escrow provisions of the Gateway acquisition agreement.

See Note 16 for additional information on the Gateway acquisition.

The Company has also accrued $ 24.0 million in connection with pending legal settlements.

See Note 12 for additional information on Commitments and Contingencies.

On October 23, 2023 (the "Effective Date"), the Company and Ravgen, Inc.

("Ravgen") entered into a settlement agreement pursuant to which the parties agreed to settle a pending lawsuit.

Pursuant to the terms of the settlement agreement, the Company agreed to pay Ravgen a minimum of $ 12.8 million in three installment payments of $ 5 million, $ 5 million, and $ 2.8 million on or before October 31, 2023, October 31, 2024, and October 31, 2025, respectively.

The Company also agreed to pay Ravgen $ 21.3 million in five annual installments beginning no earlier than January 1, 2026 if Ravgen successfully concluded in its favor all of Ravgen's litigations and patent reexaminations pending as of the Effective Date.

As of the Effective Date, the Company determined that the payment of $ 21.3 million was probable and estimable.

In the year ended December 31, 2024, based on updated information, the Company determined that the payment is no longer probable and reversed the accrual on the Consolidated Statements of Operations.

PREFERRED AND COMMON STOCKHOLDERS' EQUITY

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On November 30, 2017, the Company’s stockholders approved the adoption of the 2017 Employee, Director and Consultant Equity Incentive Plan (as amended, the “2017 Plan”).

The 2017 Plan allows the Company, under the direction of the Compensation and Human Capital Committee of the Board of Directors (the "CHCC"), to make grants of restricted and unrestricted stock and stock unit awards to employees, consultants and directors.

The 2017 Plan allows the Company, under the direction of the Compensation and Human Capital Committee (the "CHCC") of the Board of Directors, to make grants of restricted and unrestricted stock and stock unit awards to employees, consultants and directors.

Stockholders have subsequently approved amendments to the 2017 Plan increasing the shares available to grant thereunder, including most recently at the Company's annual meeting of stockholders held on June 1, 2023, when stockholders approved an amendment to the 2017 Plan to increase the aggregate number of shares of common stock available thereunder for the granting of awards by an additional 4.8 million shares.

As of December 31, 2024, the Company had 2.2 million shares of common stock available for grant under the 2017 Plan.

If an RSU awarded under the 2017 Plan is cancelled or forfeited without the issuance of shares of common stock, the unissued or reacquired shares that were subject to the RSU will again be available for issuance pursuant to the 2017 Plan.

If an RSU awarded under the 2017 Plan is cancelled or forfeited without the issuance of shares of common stock, the unissued shares that were subject to the RSU will again be available for issuance pursuant to the 2017 Plan.

The number of shares, terms, and vesting periods are generally determined by the Company’s Board of Directors or the CHCC on an award-by-award basis.

RSUs granted to employees generally vest either ratably over three or four years or as a cliff vesting after three years either on the anniversary of the date on which the RSUs were granted or during the month in which such anniversary dates occur.

The number of PSUs awarded to certain employees may be increased or may be reduced based on certain additional performance and market metrics.

RSUs granted to non-employee directors vest in full upon the earlier of the completion of one year of service following the date of the grant or the date of the next annual meeting of stockholders following such grant.

RSUs granted to employees generally vest either ratably over three or four years or as cliff vesting after three years either on the anniversary of the date on which the RSUs were granted or during the month in which such anniversary dates occur.

The number of PSUs awarded to certain employees may be increased or reduced based on certain additional performance and market metrics.

RSUs granted to non-employee directors generally vest in full upon the earlier of the completion of one year of service following the date of the grant or the date of the next annual meeting of stockholders following such grant.

Options granted to the Company's President and Chief Executive Officer as an inducement to his employment expire on August 13, 2027.

The performance and market conditions associated with PSU awards granted during the year ended December 31, 2024 include vesting that is based on revenue targets ( 34 % weighting), adjusted earnings per share targets ( 33 % weighting), and relative total stockholder return ( 33 % weighting) measured against the Nasdaq Health Care Index (IXHC) using the 20 -trading day averages at the beginning and end of the measurement period.

The measurement period for the relative total stockholder return metric is January 1, 2023 to December 31, 2025, and the revenue and adjusted earnings per share metrics will be measured based on fiscal year 2025 results.

The Company estimates the likelihood of achievement of performance conditions at the end of each period.

The measurement period for the relative total stockholder return metric is January 1, 2024 through December 31, 2026, and the revenue and adjusted earnings per share metrics will be measured based on fiscal year 2026 results.

The Company estimates the likelihood of achievement of performance conditions for all PSU awards at the end of each period.

To the extent those awards or portions thereof are considered probable of being achieved, such awards or portions thereof are expensed over the performance period.

The portion of the awards pertaining to relative total stockholder return represent market conditions and, accordingly, the estimated fair value of such awards are recognized over the performance period.

The portion of the awards pertaining to relative total stockholder return represent market conditions and, accordingly, the estimated fair value of such awards is recognized over the performance period.

Stock Options

A summary of the stock option activity under the Company's equity plans, and inducement awards for the year ended December 31, 2023 is as follows:

A summary of the stock option activity under the Company's inducement awards for the twelve months ended December 31, 2024 is as follows:

(number of shares in millions) Number

3 unchanged sentences

Options outstanding at December 31, 2024 0.7 13.38 2.62

0.7 13.38 3.62

Options exercisable at December 31, 2024 0.5 13.38 2.62

0.5 13.38 3.62

Options vested and expected to vest 0.2 $ 13.38 2.62

14 unchanged sentences

(in millions) 2024 2023 2022

Cost of testing revenue $ 1.4 $ 1.7 $ 1.5

Cost of other revenue — — 0.1

Cost of revenue

$ 1.6 $ 1.4 $ 1.7

Research and development expense 8.8 4.0 5.2

Selling, general, and administrative expense 35.3 31.2 30.5

Sales and marketing expense 9.0 7.2 6.2

General and administrative expense 30.4 28.1 25.0

Total stock-based compensation expense $ 49.8 $ 40.7 $ 38.1

2 unchanged sentences

The aggregate intrinsic value of options outstanding, aggregate intrinsic value of options that are fully vested and aggregate intrinsic value of RSUs vested and expected to vest is as follows:

(in millions) As of

December 31, 2023

(in millions) December 31, 2024

Aggregate intrinsic value of options outstanding $ 0.2

1 unchanged sentence

Aggregate intrinsic value of RSUs outstanding 71.7

The total intrinsic value of options exercised was as follows:

Years Ended December 31,

(in millions) 2023 2022 2021

Total intrinsic value of options exercised $ — $ — $ 29.2

Employee Stock Purchase Plan

The Company also has an Employee Stock Purchase Plan that was initially approved by stockholders in 2012 and was amended and approved by the Board of Directors of the Company on September 23, 2021 and the stockholders on June 2, 2022 (the “Amended and Restated 2012 Purchase Plan”), under which 4.0 million shares of common stock were authorized.

Shares are issued under the Amended and Restated 2012 Purchase Plan twice yearly at the end of each offering period and the number of shares that may be purchased by any participant during an offering period is limited to 5,000 shares.

5 unchanged sentences

(in millions) 2024 2023 2022

Shares purchased under the plans 0.4 0.3 0.2

Shares purchased under the plan

Plan compensation expense $ 2.1 $ 2.2 $ 1.9

30 unchanged sentences

(in millions) 2024 2023 2022

Federal income tax expense at the statutory rate $ ( 54.9 ) 21.0 % $ ( 29.5 ) 21.0 % $ ( 12.0 ) 21.0 %

Federal income tax benefit at the statutory rate

$ ( 25.9 ) 21.0 % $ ( 54.9 ) 21.0 % $ ( 29.5 ) 21.0 %

State income taxes, net of federal benefit ( 2.4 ) 1.9 % ( 4.1 ) 1.6 % ( 3.3 ) 2.3 %

1 unchanged sentence

Uncertain tax positions 2.8 ( 2.3 ) % 3.7 ( 1.4 ) % 0.6 ( 0.4 ) %

Incentive stock option and employee stock purchase plan expense 1.2 ( 0.5 ) % 2.5 ( 1.8 ) % 0.7 ( 1.2 ) %

Stock-based incentive awards

0.8 ( 0.6 ) % 1.2 ( 0.5 ) % 2.5 ( 1.8 ) %

Foreign rate differential 3.3 ( 2.7 ) % ( 0.4 ) 0.2 % — — %

Change in valuation allowance 15.7 ( 12.7 ) % 52.6 ( 20.1 ) % 2.6 ( 1.8 ) %

CARES Act — — % — — % 2.7 ( 4.7 ) %

Non-deductible meals and entertainment — — % — — % 0.1 ( 0.2 ) %

Non-deductible officer compensation 3.9 ( 3.2 ) % 3.0 ( 1.1 ) % 3.5 ( 2.5 ) %

Non-deductible legal settlement — — % — — % 2.5 ( 4.5 ) %

Acquisitions, dispositions, and contingent consideration 0.1 — % ( 0.1 ) 0.1 % ( 23.0 ) 40.3 %

Acquisitions and dispositions

5.1 ( 4.1 ) % 0.1 — % ( 0.1 ) 0.1 %

Other, net 0.9 ( 0.7 ) % 1.5 ( 0.7 ) % ( 1.4 ) 0.9 %

8 unchanged sentences

Lease liability 24.4 28.0

Section 174 capitalized costs 38.4 21.2

Capitalized research and development costs

Accrued expenses and liabilities 16.5 22.5

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Property, plant and equipment 3.2 1.9

Other, net 0.8 —

Total deferred tax liabilities 72.8 101.6

Net deferred tax liability $ ( 1.6 ) $ ( 3.5 )

The Tax Cuts and Jobs Act (TCJA), passed in 2017, amended Section 174 of the Internal Revenue Code to require that specific research and experimental (R&E) expenditures be capitalized and amortized over five years for U.S.

R&E expenditures or 15 years for non-U.S.

R&E expenditures beginning in the Company’s fiscal year ended December 31, 2022.

Although Congress has considered legislation that would defer, modify or repeal the capitalization and amortization requirement, there is no assurance that the provision will be deferred, repealed or otherwise modified.

If the requirement is not modified, the Company may be required to utilize some of its federal and state tax attributes and there may be increases to state cash taxes or tax expense.

The Company has incurred a cumulative three-year loss.

Pursuant to ASC 740, Income Taxes ("ASC 740"), the negative evidence of a cumulative loss may be difficult to overcome.

Due to cumulative book losses and the lack of sufficient positive evidence, the Company has applied a valuation allowance to all applicable deferred tax assets, leaving a remaining deferred tax liability balance of $ 1.6 million.

Net deferred tax asset (liability)

$ 0.4 $ ( 1.6 )

The Company incurred a loss in the current year and the two preceding years, resulting in a three-year cumulative loss.

Pursuant to ASC 740, Income Taxes ("ASC 740"), a company that is in a cumulative loss position must consider the weight of this significant negative evidence together with the weight of other positive and negative evidence that is available to determine the realizability of deferred tax assets and that overcoming negative evidence such as cumulative losses in recent years is difficult.

Due to significant negative evidence and the lack of sufficient positive evidence, the Company has applied a valuation allowance to the majority of its deferred tax assets, leaving a remaining deferred tax asset balance of $ 0.4 million.

For those foreign entities for which an election has been made to be treated as disregarded for U.S.

tax purposes, the appropriate U.S.

jurisdiction deferred tax assets and liabilities have been recorded.

At December 31, 2024, the Company had the following net operating loss and research credit carryforwards (tax effected), with their respective expiration periods.

Certain carryforwards are subject to the limitations of Section 382 and 383 of the Internal Revenue Code as indicated (in millions):

Carryforwards Amount Subject to

sections 382, 383 Expires

Certain carryforwards are subject to the limitations of Section 382 and 383 of the Internal Revenue Code as indicated:

Carryforwards (in millions)

Amount Subject to

Sections 382, 383

beginning in year Through

1 unchanged sentence

Federal capital loss 13.8 No 2026 2029

Utah net operating loss 0.8 No 2024 Indefinite

Utah net operating loss 0.9 No Indefinite Indefinite

California net operating loss 5.0 Yes 2029 2044

4 unchanged sentences

California research credit 5.2 No Indefinite Indefinite

Due to the cumulative losses that have been incurred to date in foreign operations, the changes of the Tax Cuts and Jobs Act and the election to treat its foreign subsidiaries as disregarded entities, no deferred taxes related to the Company’s foreign operations have been recorded.

For those foreign entities for which an election has been made to be treated as disregarded for U.S.

tax purposes, the appropriate U.S.

jurisdiction deferred tax assets and liabilities have been recorded.

The Company provides for uncertain tax positions when such tax positions do not meet the recognition thresholds or measurement criteria as set forth in ASC 740.

8 unchanged sentences

Gross decreases - settlements — — ( 0.7 )

Gross decreases - statute lapse — — ( 0.1 )

Unrecognized tax benefits at end of year $ 51.7 $ 48.1 $ 43.9

1 unchanged sentence

In 2022, the Company filed a U.S.

federal tax return taking an uncertain tax position that was not recorded as a benefit or deferred tax asset in the financial statements but for which the $ 12.0 million unrecognized tax benefit has been included in the table above.

Interest and penalties related to uncertain tax positions are included as a component of Income tax benefit and all other interest and penalties are included as a component of Other income (expense) in the Consolidated Statements of Operations.

federal tax return taking an uncertain tax position that was not recorded as a benefit or deferred tax asset in the financial statements but for which a $ 12.0 million unrecognized tax benefit has been included in the table above.

The Company believes it is reasonably possible that a decrease of up to $ 48 million in unrecognized tax benefits may be necessary within the coming year.

Interest and penalties related to uncertain tax positions are included as a component of Income tax expense (benefit) and all other interest and penalties are included as a component of Other income (expense) in the Consolidated Statements of Operations.

For the years ended December 31, 2024 and December 31, 2023, $ 32.7 million and $ 30.2 million of the unrecognized tax benefits, if recognized, would affect the effective tax rate, respectively.

1 unchanged sentence

federal, foreign and state income tax returns in jurisdictions with various statutes of limitations.

The Company is currently under audit by Switzerland for the years ended June 30, 2017 through December 31, 2021 Annual tax provisions include amounts considered necessary to pay assessments that may result from examination of prior year tax returns;

The Company is currently under audit by the state of California for years ended June 30, 2017 through June 30, 2018.

Annual tax provisions include amounts considered necessary to pay assessments that may result from examination of prior year tax returns;

however, the amount ultimately paid upon resolution of issues may differ materially from the amount accrued.

6 unchanged sentences

The Company intends to defend its current litigation matters but cannot provide any assurance as to the ultimate outcome or that an adverse resolution would not have a material adverse effect on its financial condition, results of operations or cash flows.

The Company assesses legal contingencies to determine the degree of probability and range of possible loss for potential accrual in its financial statements.

The Company assesses legal contingencies to determine the degree of probability and range of possible loss for potential accrual and disclosure in its financial statements.

When evaluating legal contingencies, the Company may be unable to provide a meaningful estimate due to a number of factors, including the proceedings may be in early stages, there may be uncertainty as to the outcome of pending appeals or motions, there may be significant factual issues to be resolved, and there may be complex or novel legal theories to be presented.

In addition, damages may not be specified or the damage amounts claimed may be unsupported, exaggerated or unrelated to possible outcomes, and therefore, such amounts are not a reliable indicator of potential liability.

As of December 31, 2023, except as noted below, the Company has not recorded any material accrual for loss contingencies associated with legal proceedings or other matters or determined that an unfavorable outcome is probable and reasonably estimable in accordance with ASC 450, Contingencies .

As of December 31, 2024, the Company has not recorded any material accrual for loss contingencies associated with legal proceedings or other matters or determined that an unfavorable outcome is probable and reasonably estimable in accordance with ASC 450, Contingencies .

However, it is possible that the ultimate resolution of legal proceedings or other matters, if unfavorable, may be material to the Company's results of operations, financial condition or cash flows.

Further, in the event that damages from an unfavorable resolution of one or more of these proceedings exceed the aggregate amount of the coverage limits of the Company’s insurance, or if the Company’s insurance carriers disclaim coverage, the amounts payable by the Company could also have a material adverse impact on the Company’s results of operations, financial condition or cash flows.

Securities Class Action

On September 27, 2019, a class action complaint was filed in the U.S.

District Court for the District of Utah, against the Company, its former President and Chief Executive Officer, Mark C.

Capone, and its Chief Financial Officer, R.

Bryan Riggsbee (Defendants).

On February 21, 2020, the plaintiff filed an amended class action complaint, which added the Company's former Executive Vice President of Clinical Development, Bryan M.

Dechairo, as an additional Defendant.

This action, captioned In re Myriad Genetics, Inc.

Securities Litigation (No.

2:19-cv-00707-DBB), is premised upon allegations that the Defendants made false and misleading statements regarding the Company's business, operations, and acquisitions.

The lead plaintiff sought the payment of damages allegedly sustained by it and the class by reason of the allegations set forth in the amended complaint, plus interest, and legal and other costs and fees.

On March 16, 2021, the U.S.

District Court for the District of Utah denied the Company's motion to dismiss.

On December 1, 2021, the U.S.

District Court for the District of Utah granted plaintiff's motion for class certification.

On August 3, 2023, the Company entered into a stipulation and agreement of settlement to resolve this lawsuit (the "Settlement") and the parties filed a motion seeking court approval of the Settlement.

The Settlement was approved by the court on December 15, 2023, and the case was subsequently dismissed.

Pursuant to the terms of the Settlement, the Company paid an aggregate settlement amount of $ 77.5 million in cash.

As part of the terms of the Settlement, the settlement class agreed to release the Company, the other defendants named in the lawsuit, and certain of their respective related parties from any and all claims, suits, causes of action, damages, demands, liabilities, or losses that are based upon, arise from, or relate to (a) the purchase, acquisition or trading of any common stock during the class period from August 9, 2017 until February 6, 2020;

and (b) the allegations, transactions, facts, matters or occurrences, representations, or omissions involved, set forth, or referred to in the class action.

The Settlement also contained no admission of liability, wrongdoing or responsibility by any of the parties.

Stockholder Derivative Actions

On August 9, 2021, a stockholder derivative complaint was filed in the Delaware Court of Chancery against the Company's former President and Chief Executive Officer, Mark C.

Capone, its Chief Financial Officer, R.

Bryan Riggsbee, its former Executive Vice President of Clinical Development, Bryan M.

Dechairo, and certain of the Company's current and former directors, Lawrence C.

Best, Walter Gilbert, John T.

Henderson, Heiner Dreismann, Dennis Langer, Lee N.

Louise Phanstiel, and Colleen F.

Reitan (collectively, the Individual Defendants), and the Company, as nominal defendant.

The complaint is premised upon similar allegations as set forth in the securities class action, including that the Individual Defendants made false and misleading statements regarding the Company's business and operations.

The plaintiff, Donna Hickock, asserts breach of fiduciary duty and unjust enrichment claims against the Individual Defendants and seeks, on behalf of the Company, damages allegedly sustained by the Company as a result of the alleged breaches, or disgorgement or restitution, from each of the Individual Defendants, plus interest.

Plaintiff Hickock also seeks legal and other costs and fees relating to this action.

On November 19, 2021, this action was stayed by the Delaware Court of Chancery pending the resolution of the securities class action lawsuit.

On January 18, 2022, a stockholder derivative complaint was filed in the Delaware Court of Chancery against the Individual Defendants, and the Company, as nominal defendant.

The action is premised upon similar allegations as set forth in the securities class action and the Hickock stockholder derivative action.

The plaintiff, Esther Kogus, asserts that the Individual Defendants breached their fiduciary duties and also asserts unjust enrichment and aiding and abetting breaches of fiduciary duty claims against the Individual Defendants.

Plaintiff Kogus seeks, on behalf of the Company, damages allegedly sustained by the Company as a result of the alleged breaches and claims, and restitution from the Individual Defendants.

On behalf of herself, plaintiff Kogus seeks legal and other costs and fees relating to this action.

On March 3, 2022, the Delaware Court of Chancery consolidated the Hickock and Kogus derivative actions and stayed the consolidated action.

This consolidated action currently remains stayed.

On September 17, 2021, a stockholder derivative complaint was filed in the U.S.

District Court in the District of Delaware against the Individual Defendants, and the Company, as nominal defendant.

The action is premised upon similar allegations as set forth in the securities class action and Hickock stockholder derivative action.

The plaintiff, Karen Marcey, asserts that the Individual Defendants violated U.S.

securities laws and breached their fiduciary duties, and also asserts unjust enrichment, waste of corporate assets and insider trading claims against all or some of the Individual Defendants.

Plaintiff Marcey seeks, on behalf of the Company, damages allegedly sustained by the Company as a result of the alleged violations and restitution from the Individual Defendants, plus interest and, on behalf of herself, legal and other costs and fees relating to this action.

On January 4, 2022, this action was stayed by the U.S.

District Court for the District of Delaware pending the resolution of the securities class action lawsuit.

This action currently remains stayed.

Other Legal Proceedings

On December 21, 2020, Ravgen, Inc.

("Ravgen") filed a lawsuit against the Company and its wholly owned subsidiary, Myriad Women's Health, Inc., in the U.S.

District Court for the District of Delaware, alleging infringement of two Ravgen-owned patents.

The lawsuit sought monetary damages, enhancement of those damages for willfulness, injunctive relief, and recovery of attorney's fees and costs.

Various third parties have filed challenges to the validity of the asserted patents with the U.S.

Patent and Trademark Office, which challenges have been instituted for review.

On March 14, 2022, the case was stayed pending the outcome of the first of these validity challenges.

On February 13, 2023, the court lifted the stay and litigation of the case resumed.

On October 23, 2023 (the "Effective Date"), the Company and Ravgen entered into a settlement agreement pursuant to which the parties agreed to settle the lawsuit.

As part of the settlement, the Company agreed to pay Ravgen a minimum of $ 12.75 million in three installment payments as follows:

(1) the first installment of $ 5.0 million on or before October 31, 2023, (2) the second installment of $ 5.0 million on or before October 31, 2024, and (3) the third installment of $ 2.75 million on or before October 31, 2025.

Subject to the terms of the settlement agreement, the Company also agreed to pay Ravgen an additional contingent payment of $ 21.25 million payable in five annual installments, with (1) the first installment of $ 5.0 million payable on the later of (a) 30 days after notification in writing by Ravgen of the successful conclusion in favor of Ravgen of all of Ravgen's litigations and patent reexaminations pending as of the Effective Date and (b) January 1, 2026 (the "Contingent Payment Date");

(2) the second installment of $ 5.0 million on the first anniversary of the Contingent Payment Date;

(3) the third installment of $ 5.0 million on the second anniversary of the Contingent Payment Date;

(4) the fourth installment of $ 5.0 million on the third anniversary of the Contingent Payment Date;

and (5) $ 1.25 million on the fourth anniversary of the Contingent Payment Date.

As of December 31, 2023, the Company has accrued $ 29.0 million for this action, of which $ 24.0 million is included in Other long-term liabilities and $ 5.0 million is included in Accrued liabilities in the Company's Consolidated Balance Sheets as of December 31, 2023.

On February 3, 2022, a purported class action lawsuit was filed against the Company in the U.S.

District Court in the Northern District of California by Ashley Carroll.

Plaintiff alleged, among other things, that the Company made false statements about the accuracy of its Prequel prenatal screening test.

The complaint sought unspecified monetary damages, as well as punitive damages and injunctive relief.

On April 1, 2022, the Company filed a motion to dismiss the lawsuit.

On May 2, 2022, the plaintiff amended her complaint.

On June 2, 2022, the Company filed a motion to dismiss the amended complaint.

On July 26, 2022, the court granted and denied in part the Company's motion to dismiss the amended complaint.

As part of the court's order, plaintiff was granted leave to file a second amended complaint.

The plaintiff filed a second amended complaint on August 16, 2022.

On September 6, 2022, the Company filed a motion to dismiss the second amended complaint.

On November 9, 2022, the Court granted and denied in part the Company's motion to dismiss the second amended complaint.

On October 6, 2023, the Company and the plaintiff agreed to settle the lawsuit for an immaterial amount.

The settlement agreement contains no admission of liability, wrongdoing or responsibility on the part of the Company.

From time to time, the Company receives recoupment requests from third-party payors for alleged overpayments.

The Company disagrees with the contentions of the pending requests or has recorded an estimated reserve for the alleged overpayments.

The Company leases certain office spaces and research and development laboratory facilities, vehicles, and office equipment with remaining lease terms ranging from approximately one to fifteen years .

Qui Tam Lawsuit

In June 2023, the Company received a civil investigative demand pursuant to the False Claims Act from the United States Department of Justice concerning whether the Company offered or paid remuneration to physicians at Carolina Urology Partners, PLLC, in exchange for referrals.

The Department of Justice subsequently requested additional documentation and information during its investigation.

The Company cooperated with the Department of Justice investigation, providing the documents and information requested.

On January 22, 2025, the U.S.

District Court for the Western District of North Carolina unsealed a qui tam complaint, filed on November 3, 2022, against Carolina Urology Partners, PLLC, and certain of its current or former physician partners, and the Company and certain of its former employees, alleging violations of the False Claims Act.

On January 21, 2025, after a multi-year investigation into the Company's alleged conduct, the United States declined to intervene.

The Company was not aware of the complaint until after it was unsealed and the Company has not been served the complaint yet.

The Company leases certain office spaces, research and development laboratory facilities, and office equipment with remaining lease terms ranging from approximately one to 14 years.

These leases require monthly lease payments that may be subject to annual increases throughout the lease term.

Certain of these leases also include renewal options, which allows the Company to, at its election, renew or extend the lease for a fixed period of time.

These optional periods have not been considered in the determination of the ROU assets or lease liabilities associated with these leases as the Company did not consider it reasonably certain it would exercise the options.

Due to the increase in remote and hybrid work and the Company's need to ensure its facilities are designed to handle future growth, the Company has been executing on a multi-year strategy to reset its real estate footprint.

As part of that strategy, in the first quarter of 2022, the Company entered into a non-cancelable operating lease for approximately 234,000 square feet in west Salt Lake City, Utah.

The Company took possession of this leased facility in phases, beginning in the three months ended June 30, 2022.

During the twelve months ended December 31, 2023, the Company took possession of the remaining phases of the west Salt Lake City facility and recognized $ 5.9 million of ROU asset and corresponding lease liability, net of tenant improvement allowance not yet received.

The lease has a term of 15 years and total future rent payments under the lease are approximately $ 79.6 million.

Also during the twelve months ended December 31, 2023, the Company assigned the lease for its previous corporate headquarters to a third party and transitioned its headquarters to the west Salt Lake City facility.

As a result of the lease assignment, the operating lease ROU asset and operating lease liability associated with the previous headquarters of $ 33.3 million and $ 39.6 million, respectively, were removed from the Company's Consolidated Balance Sheets.

In connection with the assignment of the lease, the Company recorded an accrual of $ 8.5 million for future payments under the lease assignment agreement, which is included in Accrued liabilities and Other long-term liabilities in the Company's Consolidated Balance Sheets as of December 31, 2023.

The total net loss recognized associated with the assignment of the lease agreement was $ 7.7 million, which is included in Selling, general, and administrative expense in the Company's Consolidated Statements of Operations.

In addition, the Company modified the remaining lease term of certain other Salt Lake City facilities reducing the associated ROU asset and lease liability by $ 6.4 million.

In connection with the Company's multi-year real-estate strategy, the Company also entered into a non-cancelable operating lease for approximately 63,000 square feet in South San Francisco, California with a term of 10 years, which commenced in the second half of fiscal year 2023.

The Company took possession of the lease during fiscal year 2022 and recognized the related ROU asset and lease liability, net of tenant improvement allowance not yet received, of $ 30.7 million.

Total future rent payments under the lease are approximately $ 56.7 million.

The Company plans to transition all of the operations from the current South San Francisco facility, which has approximately 49,000 square feet of laboratory space utilized to perform testing for the Women's Health business, to the new South San Francisco facility.

During the twelve months ended December 31, 2022, the Company ceased the use of certain of its leased Salt Lake City facilities and one of its South San Francisco facilities.

As a result, the Company recorded an impairment charge on ROU assets of $ 13.0 million and an impairment charge of $ 3.9 million on the related property, plant and equipment, which consisted primarily of leasehold improvements.

The total $ 16.9 million impairment is included in Goodwill and long-lived asset impairment charges in the Consolidated Statement of Operations.

These optional periods have not been considered in the determination of the ROU assets or lease liabilities associated with these leases when the Company did not consider it reasonably certain it would exercise the options.

The Company has continued to execute on its multi-year strategy to reset its real estate footprint.

During the year ended December 31, 2024, the Company took full possession of the remaining phases of its west Salt Lake City, Utah facility.

The Company has completed the transition of its corporate support operations and certain laboratory operations from its legacy facilities in Salt Lake City to its new facility in west Salt Lake City.

The Company plans to complete the transition of its remaining laboratory facilities to its next generation laboratory facilities in early 2025.

Additionally, during 2024, the Company amended the lease for its west Salt Lake City facility to include approximately 63,000 additional square feet of laboratory space in anticipation of future operating needs.

The lease has a term of 12 years and ends coterminous with the rest of the lease.

The amendment is expected to commence in fiscal year 2026 with future rent payments totaling $ 18.2 million.

During the year ended December 31, 2023, the Company assigned the lease for its previous corporate headquarters to a third party.

As a result, the operating ROU asset and operating lease liability associated with the lease was removed from the Company's Condensed Consolidated Balance Sheets.

As of December 31, 2024, the Company has accrued $ 3.8 million for the remaining future payments under the lease assignment agreement, which was included in Accrued liabilities in the Consolidated Balance Sheets.

Also during the year ended December 31, 2023, the Company modified the remaining lease term of certain other Salt Lake City, Utah facilities reducing the associated ROU asset and lease liability by $ 6.4 million.

The Company performed evaluations of its contracts and determined the majority of its identified leases are operating leases.

5 unchanged sentences

The Company's finance leases are immaterial.

As of December 31, 2023, the maturities of the Company’s operating lease liabilities were as follows (in millions):

As of December 31, 2024, the maturities of the Company’s operating lease liabilities were as follows:

Year Ended (in millions) :

Thereafter 73.7

19 unchanged sentences

SEGMENT AND RELATED INFORMATION

The Company’s business is aligned with how the chief operating decision maker ("CODM") reviews performance and makes decisions in managing the Company.

Management prepares budgets at the operating segment level, and the CODM approves the budget, reviews the business, makes investing and resource allocation decisions and assesses operating performance at both the operating segment level and on an aggregate basis.

As the Company’s operating segments have similar economic and other characteristics, including the nature of the products and production processes, types of customers, distribution methods, and regulatory environment, they have been aggregated into a single reporting segment, which primarily provides testing that helps assess an individual’s risk for developing disease or disease progression and guides treatment decisions across medical specialties where genetic insights can significantly improve patient health care and lower health care costs, and includes corporate services such as finance, human resources, legal and information technology.

The following table reconciles assets by geographical region to total assets:

The Company’s business is aligned with how the CODM reviews performance and makes decisions in managing the Company.

The Company has identified the President and Chief Executive Officer as the CODM.

The CODM regularly reviews consolidated financial information for the purposes of evaluating performance, allocating resources, setting incentive compensation targets, and planning and forecasting for future periods.

Accordingly, the Company has determined that it operates as a single operating segment.

The Company has identified consolidated net income (loss) as the measure of segment profitability.

The significant expenses and other segment expenses presented to the CODM are at the same level as presented in Consolidated Statement Operations in these financial statements.

The Company's long-lived assets by geographical region are as follows:

(in millions) 2024 2023

Net equipment, leasehold improvements and property:

United States $ 117.7 $ 81.9

Rest of world 1.3 1.5

Total $ 119.0 $ 83.4

Total assets:

Long-lived assets:

United States $ 728.1 $ 794.6

1 unchanged sentence

Total $ 729.5 $ 832.9

Cash, cash equivalents, and marketable investment securities 140.9 169.7

Total $ 1,146.5 $ 1,198.7

BUSINESS ACQUISITION

On November 1, 2022, the Company acquired all of the membership interests of Gateway, a San Diego-based personal genomics company and developer of consumer genetic tests that give families insight into their future children.

The acquisition date fair value of the consideration transferred was $ 68.7 million.

The following table summarizes the estimated fair value of identified assets acquired and liabilities assumed at the date of acquisition.

(in thousands) Estimated fair value

Identifiable assets acquired

Current assets $ 1,053

Inventory 1,900

Intangible assets

Developed technology 10,100

Trademarks 6,100

Customer relationships 1,600

Total intangible assets 17,800

Other non-current assets 161

Total identifiable assets acquired 20,914

Liabilities assumed

Accounts payable ( 246 )

Accrued liabilities ( 693 )

Total liabilities assumed ( 939 )

Net identifiable assets acquired 19,975

Goodwill 48,723

Total fair value of Purchase Price $ 68,698

Pro Forma Information (Unaudited)

The unaudited pro forma results presented below include the effects of Gateway acquisition as if it had been consummated as of January 1, 2021, with adjustments to give effect to pro forma events that are directly attributable to the acquisition, which includes adjustments related to the amortization of acquired intangible assets, interest income and expense, and depreciation.

The unaudited pro forma results do not reflect any operating efficiency or potential cost savings that may result from the consolidation of Gateway with the Company.

Accordingly, these unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operation of the combined company would have been if the acquisition had occurred at the beginning of the period presented, nor are they indicative of future results of operations and are not necessarily indicative of results that might have been achieved had the acquisition been consummated as of January 1, 2021.

The Company did not have any material, nonrecurring pro forma adjustments directly attributable to the business acquisition included in the reported pro forma earnings.

Years Ended December 31,

(in thousands) 2022 2021

Revenue $ 695,632 $ 709,132

Net loss ( 112,185 ) ( 28,686 )

Revenue and net loss from Gateway included in the Company's Consolidated Statements of Operations for the year ended December 31, 2023 is $ 21.1 million and $ 4.0 million, respectively.

Revenue and net loss from Gateway included in the Company's Consolidated Statements of Operations from the acquisition date through December 31, 2022 is $ 3.3 million and $ 2.8 million, respectively.

On May 28, 2021, the Company completed the sale of the Myriad myPath, LLC laboratory to Castle Biosciences, Inc.

for cash consideration of $ 32.5 million.

The transaction was accounted for as a sale of assets and the Company recognized a gain of $ 31.2 million, net of transaction costs of $ 1.3 million, in Other income (expense) in the Consolidated Statements of Operations.

On July 1, 2021, the Company completed the sale of Myriad RBM, Inc., then a wholly owned subsidiary of the Company, to IQVIA RDS, Inc., for cash consideration of $ 197.0 million.

The transaction was accounted for as a sale of a business and the Company recognized a gain of $ 121.0 million, net of transaction costs of $ 4.8 million, in Other income (expense) in the Consolidated Statements of Operations.

On September 13, 2021, the Company completed the sale of select operating assets and intellectual property, including the Vectra test, from the Myriad Autoimmune business unit to Laboratory Corporation of America Holdings for cash consideration of $ 150.0 million.

The transaction was accounted for as a sale of a business and the Company recognized a loss of $ 0.6 million, net of transaction costs of $ 4.4 million, in Other income (expense) in the Consolidated Statements of Operations.

The operating results of these businesses do not qualify for reporting as discontinued operations.

In connection with the divestiture transactions, the Company recognized losses of $ 5.2 million and $ 6.5 million for a non-cancelable inventory purchase commitment and inventory, respectively, during the year ended December 31, 2021, as t he Company no longer had use for the goods.

Both of these losses are included in Other income (expense) in the Consolidated Statements of Operations for the year ended December, 2021.

The following table details the amounts recognized in Other income (expense) for the year ended December 31, 2021:

(in millions) Year Ended December 31, 2021

Gain on sale of Myriad RBM, Inc.

Gain on sale of the Myriad myPath, LLC laboratory 31.2

Loss on inventory ( 11.7 )

Loss on sale of Myriad Autoimmune assets ( 0.6 )

Other ( 0.6 )

Total other income (expense) $ 139.3

On February 1, 2024, the Company acquired from Intermountain Health select assets for an immaterial amount from its Intermountain Precision Genomics ("IPG") laboratory business, including the Precise Tumor Test, the Precise Liquid Test, and IPG's CLIA-certified laboratory in St.

George, Utah (the "Precise acquisition").

In connection with the Precise acquisition, the Company recognized a gain of $ 2.2 million, which is included in Other income in the Consolidated Statements of Operations.

On August 1, 2024, the Company completed the sale of its EndoPredict business to Eurobio Scientific ("Eurobio") for net cash consideration of $ 10.0 million, subject to customary closing adjustments.

The transaction was accounted for as a sale of business.

The Company recognized a total net loss, including transaction expenses, of $ 12.4 million during the twelve months ended December 31, 2024 in connection with this sale.

The loss is included in Goodwill and long-lived asset impairment charges on the Consolidated Statements of Operations.

The recognized loss included the release of $ 4.4 million of foreign currency translation adjustments previously included in Accumulated other comprehensive income (loss).

As part of the transaction, the Company licensed the rights from Eurobio to continue to sell EndoPredict as a laboratory developed test outside of the European Union and licensed to Eurobio the right to sell Prolaris in vitro diagnostic kits outside the U.S.

SUPPLEMENTAL CASH FLOW INFORMATION

The Company's supplemental cash flow information for the respective periods are as follows:

Years Ended December 31,

(in millions) 2024 2023 2022

1 unchanged sentence

Cash paid for interest 1.9 1.4 —

Cash received for income tax receivables — — 90.0

Non-cash investing and financing activities:

4 unchanged sentences

Purchases of property, plant and equipment and capitalization of internal-use software in accounts payable and accrued liabilities

SUBSEQUENT EVENTS

On February 1, 2024, the Company acquired from Intermountain Health select assets for an immaterial amount from its Intermountain Precision Genomics (IPG) laboratory business, including the Precise Tumor Test, the Precise Liquid Test, and IPG's CLIA-certified laboratory in St.

George, Utah.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

1 unchanged sentence

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 8. Financial Statements and Supplementary Data