UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, ~~2021~~2022


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 0-26642

MYRIAD GENETICS, INC.

(Exact name of registrant as specified in its charter)

Delaware

(State or other jurisdiction

of incorporation or organization)

320 Wakara Way, Salt Lake City, UT

(Address of principal executive offices)

87-0494517

(I.R.S. Employer Identification No.)

84108

(Zip Code)

Registrant's telephone number, including area code: (801) 584-3600

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading
Symbol(s)

Name of each exchange on which registered

Common Stock, $0.01 par value

MYGN

Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No x

As of October 27, ~~2021,~~2022, the registrant had ~~79,854,649~~81,033,816 shares of $0.01 par value common stock outstanding.

MYRIAD GENETICS, INC.

INDEX TO FORM 10-Q


		Page
	PART I - Financial Information

Item 1.	Financial Statements

	Condensed Consolidated Balance Sheets as of September 30, ~~2021~~2022 (unaudited) and December 31, ~~2020~~2021	4

	Condensed Consolidated Statements of Operations for the three and nine months ended ~~September~~September 30, ~~2021~~2022 and ~~2020~~2021 (unaudited)	5

	Condensed Consolidated Statements of Comprehensive Income ~~(Loss)~~(Loss ) for the three and nine months ended September 30, ~~2021~~2022 and ~~2020~~2021 (unaudited)	6

	Condensed Consolidated Statements of Stockholders’ Equity for the three and n ~~ine~~nine months ended September 30, 2022 ~~30,~~and 2021 ~~and 2020~~ (unaudited)	7

	Condensed Consolidated Statements of Cash Flows for the nine months endedSeptember 30, 2022 ~~30,~~and 2021 ~~and 2020~~ (unaudited)	8

	Notes to Condensed Consolidated Financial Statements (unaudited)	9

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	24

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	33

Item 4.	Controls and Procedures	3433

	PART II - Other Information

Item 1.	Legal Proceedings	3635

Item 1A.	Risk Factors	3835

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	4035

Item 3.	Defaults Upon Senior Securities	4035

Item 4.	Mine Safety Disclosures	4035

Item 5.	Other Information	4036

Item 6.	Exhibits	4136

	Signatures	4237

Table of Contents

MYRIAD GENETICS, INC.

AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(in millions)


		September 30, 2021		December 31, 2020			September 30, 2022		December 31, 2021
		(unaudited)					(unaudited)
ASSETS	ASSETS					ASSETS
Current assets:	Current assets:					Current assets:
Cash and cash equivalents	Cash and cash equivalents	$	295.2	$	117.0	Cash and cash equivalents	$	110.7	$	258.4
Marketable investment securities	Marketable investment securities	70.9		33.7		Marketable investment securities	82.5		81.4
Trade accounts receivable	Trade accounts receivable	93.6		89.5		Trade accounts receivable	102.2		91.3
Inventory	Inventory	18.6		27.1		Inventory	19.6		15.3
Prepaid taxes	Prepaid taxes	0.4		108.4		Prepaid taxes	17.8		18.4
Prepaid expenses and other current assets	Prepaid expenses and other current assets	20.2		13.7		Prepaid expenses and other current assets	19.5		20.0
Total current assets	Total current assets	498.9		389.4		Total current assets	352.3		484.8
Operating lease right-of-use assets	Operating lease right-of-use assets	83.6		59.7		Operating lease right-of-use assets	110.6		81.8
Long-term marketable investment securities	Long-term marketable investment securities	47.5		21.0		Long-term marketable investment securities	66.0		59.0
Property, plant, and equipment, net	Property, plant, and equipment, net	43.4		40.7		Property, plant, and equipment, net	67.5		43.5
Intangibles, net	Intangibles, net	414.8		576.5		Intangibles, net	370.8		404.1
Goodwill	Goodwill	239.7		329.2		Goodwill	236.5		239.2
Other assets	Other assets	8.0		2.3		Other assets	8.3		8.3
Total assets	Total assets	$	1,335.9	$	1,418.8	Total assets	$	1,212.0	$	1,320.7
LIABILITIES AND STOCKHOLDERS' EQUITY	LIABILITIES AND STOCKHOLDERS' EQUITY					LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:	Current liabilities:					Current liabilities:
Accounts payable	Accounts payable	$	15.7	$	20.5	Accounts payable	$	29.6	$	29.6
Accrued liabilities	Accrued liabilities	163.2		79.1		Accrued liabilities	85.3		156.5
Current maturities of operating lease liabilities	Current maturities of operating lease liabilities	12.8		13.6		Current maturities of operating lease liabilities	14.0		13.0
Deferred revenues	Deferred revenues	11.5		32.7		Deferred revenues	0.2		5.2
Total current liabilities	Total current liabilities	203.2		145.9		Total current liabilities	129.1		204.3
Unrecognized tax benefits	Unrecognized tax benefits	32.0		30.5		Unrecognized tax benefits	27.9		27.9
Long-term deferred taxes	Long-term deferred taxes	40.7		71.3		Long-term deferred taxes	10.5		35.8
Noncurrent operating lease liabilities	Noncurrent operating lease liabilities	80.7		50.6		Noncurrent operating lease liabilities	123.3		79.3
Long-term debt		—		224.8
Other long-term liabilities	Other long-term liabilities	10.8		14.7		Other long-term liabilities	4.6		5.6
Total liabilities	Total liabilities	367.4		537.8		Total liabilities	295.4		352.9
Commitments and contingencies	Commitments and contingencies	0		0		Commitments and contingencies
Stockholders’ equity:	Stockholders’ equity:					Stockholders’ equity:
Common stock, 79.7 million and 75.4 million shares outstanding at September 30, 2021 and December 31, 2020, respectively		0.8		0.8
Common stock, 80.9 million and 80.0 million shares outstanding at September 30, 2022 and December 31, 2021, respectively						Common stock, 80.9 million and 80.0 million shares outstanding at September 30, 2022 and December 31, 2021, respectively	0.8		0.8
Additional paid-in capital	Additional paid-in capital	1,218.8		1,109.5		Additional paid-in capital	1,251.0		1,226.3
Accumulated other comprehensive loss	Accumulated other comprehensive loss	(4.4)		(2.3)		Accumulated other comprehensive loss	(11.3)		(5.1)
Accumulated deficit	Accumulated deficit	(246.6)		(227.0)		Accumulated deficit	(323.9)		(254.2)
Total Myriad Genetics, Inc. stockholders’ equity	Total Myriad Genetics, Inc. stockholders’ equity	968.6		881.0		Total Myriad Genetics, Inc. stockholders’ equity	916.6		967.8
Non-controlling interest	Non-controlling interest	(0.1)		—		Non-controlling interest	—		—
Total stockholders' equity	Total stockholders' equity	968.5		881.0		Total stockholders' equity	916.6		967.8
Total liabilities and stockholders’ equity	Total liabilities and stockholders’ equity	$	1,335.9	$	1,418.8	Total liabilities and stockholders’ equity	$	1,212.0	$	1,320.7

See accompanying notes to Condensed Consolidated Financial Statements.

Table of Contents

MYRIAD GENETICS, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Operations (unaudited)

(in millions, except per share amounts)


		Three months ended September 30,				Nine months ended September 30,					Three months ended September 30,				Nine months ended September 30,
		2021		2020		2021		2020			2022		2021		2022		2021
Revenues:	Revenues:									Revenues:
Molecular diagnostic testing	Molecular diagnostic testing	$	167.3	$	135.7	$	505.6	$	369.5	Molecular diagnostic testing	$	156.4	$	167.3	$	500.6	$	505.6
Pharmaceutical and clinical services	Pharmaceutical and clinical services	—		9.5		24.2		32.9		Pharmaceutical and clinical services	—		—		—		24.2
Total revenue	Total revenue	167.3		145.2		529.8		402.4		Total revenue	156.4		167.3		500.6		529.8
Costs and expenses:	Costs and expenses:									Costs and expenses:
Cost of molecular diagnostic testing	Cost of molecular diagnostic testing	47.8		39.9		139.9		115.2		Cost of molecular diagnostic testing	50.4		47.8		148.1		139.9
Cost of pharmaceutical and clinical services	Cost of pharmaceutical and clinical services	—		4.3		11.9		15.8		Cost of pharmaceutical and clinical services	—		—		—		11.9
Research and development expense	Research and development expense	18.8		17.6		61.4		54.7		Research and development expense	20.5		18.8		62.0		61.4
Selling, general, and administrative expense	Selling, general, and administrative expense	180.2		124.1		460.5		364.4		Selling, general, and administrative expense	130.5		180.6		368.2		462.2
Change in the fair value of contingent consideration		0.4		(1.1)		1.7		(4.5)
Goodwill and long-lived asset impairment charges	Goodwill and long-lived asset impairment charges	—		—		1.8		98.4		Goodwill and long-lived asset impairment charges	—		—		10.7		1.8
Total costs and expenses	Total costs and expenses	247.2		184.8		677.2		644.0		Total costs and expenses	201.4		247.2		589.0		677.2
Operating loss	Operating loss	(79.9)		(39.6)		(147.4)		(241.6)		Operating loss	(45.0)		(79.9)		(88.4)		(147.4)
Other income (expense):	Other income (expense):									Other income (expense):
Interest income	Interest income	0.2		0.4		0.6		1.7		Interest income	1.1		0.2		1.6		0.6
Interest expense	Interest expense	(1.1)		(2.9)		(6.1)		(8.3)		Interest expense	(0.8)		(1.1)		(2.3)		(6.1)
Other	Other	120.6		(1.6)		139.3		14.9		Other	0.5		120.6		0.6		139.3
Total other income (expense), net	Total other income (expense), net	119.7		(4.1)		133.8		8.3		Total other income (expense), net	0.8		119.7		(0.1)		133.8
Income (loss) before income tax	Income (loss) before income tax	39.8		(43.7)		(13.6)		(233.3)		Income (loss) before income tax	(44.2)		39.8		(88.5)		(13.6)
Income tax expense (benefit)	Income tax expense (benefit)	15.2		(28.5)		6.0		(47.4)		Income tax expense (benefit)	(9.1)		15.2		(18.8)		6.0
Net income (loss)	Net income (loss)	24.6		(15.2)		(19.6)		(185.9)		Net income (loss)	(35.1)		24.6		(69.7)		(19.6)
Net loss attributable to non-controlling interest		—		—		—		(0.1)
Net income (loss) attributable to non-controlling interest										Net income (loss) attributable to non-controlling interest	—		—		—		—
Net income (loss) attributable to Myriad Genetics, Inc. stockholders	Net income (loss) attributable to Myriad Genetics, Inc. stockholders	$	24.6	$	(15.2)	$	(19.6)	$	(185.8)	Net income (loss) attributable to Myriad Genetics, Inc. stockholders	$	(35.1)	$	24.6	$	(69.7)	$	(19.6)
Net income (loss) per share:	Net income (loss) per share:									Net income (loss) per share:
Basic	Basic	$	0.31	$	(0.20)	$	(0.25)	$	(2.49)	Basic	$	(0.43)	$	0.31	$	(0.87)	$	(0.25)
Diluted	Diluted	$	0.30	$	(0.20)	$	(0.25)	$	(2.49)	Diluted	$	(0.43)	$	0.30	$	(0.87)	$	(0.25)
Weighted average shares outstanding:	Weighted average shares outstanding:									Weighted average shares outstanding:
Basic	Basic	78.8		74.7		77.3		74.6		Basic	80.7		78.8		80.4		77.3
Diluted	Diluted	81.5		74.7		77.3		74.6		Diluted	80.7		81.5		80.4		77.3

See accompanying notes to Condensed Consolidated Financial Statements.

Table of Contents

MYRIAD GENETICS, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income (Loss) (unaudited)

(in millions)


		Three months ended September 30,				Nine months ended September 30,					Three months ended September 30,				Nine months ended September 30,
		2021		2020		2021		2020			2022		2021		2022		2021
Net income (loss) attributable to Myriad Genetics, Inc. stockholders	Net income (loss) attributable to Myriad Genetics, Inc. stockholders	$	24.6	$	(15.2)	$	(19.6)	$	(185.8)	Net income (loss) attributable to Myriad Genetics, Inc. stockholders	$	(35.1)	$	24.6	$	(69.7)	$	(19.6)
Unrealized gain (loss) on available-for-sale debt securities, net of tax		(0.2)		(0.2)		(0.5)		0.5
Unrealized loss on available-for-sale debt securities, net of tax										Unrealized loss on available-for-sale debt securities, net of tax	(0.9)		(0.2)		(3.0)		(0.5)
Change in foreign currency translation adjustment, net of tax	Change in foreign currency translation adjustment, net of tax	(0.2)		1.8		(1.6)		1.1		Change in foreign currency translation adjustment, net of tax	(1.5)		(0.2)		(3.2)		(1.6)
Comprehensive income (loss)	Comprehensive income (loss)	24.2		(13.6)		(21.7)		(184.2)		Comprehensive income (loss)	(37.5)		24.2		(75.9)		(21.7)
Comprehensive income (loss) attributable to Myriad Genetics, Inc. stockholders	Comprehensive income (loss) attributable to Myriad Genetics, Inc. stockholders	$	24.2	$	(13.6)	$	(21.7)	$	(184.2)	Comprehensive income (loss) attributable to Myriad Genetics, Inc. stockholders	$	(37.5)	$	24.2	$	(75.9)	$	(21.7)

See accompanying notes to Condensed Consolidated Financial Statements.

Table of Contents

MYRIAD GENETICS, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Stockholders’ Equity (unaudited)

(in millions)


		Common stock		Additional paid-in capital		Accumulated other comprehensive loss		Accumulated deficit		Non-controlling interest		Total stockholders’ equity
BALANCES AT DECEMBER 31, 2019		$	0.7	$	1,085.1	$	(5.3)	$	(3.3)	$	0.1	$	1,077.3
Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax		—		0.2		—		—		—		0.2
Stock-based payment expense		—		7.5		—		—		—		7.5
Non-controlling interest		—		—		—		—		(0.1)		(0.1)
Net loss		—		—		—		(115.2)		—		(115.2)
Reclassification out of accumulated other comprehensive loss upon the deconsolidation of a subsidiary		—		—		0.1		—		—		0.1
Other comprehensive loss, net of tax		—		—		(2.6)		—		—		(2.6)
BALANCES AT MARCH 31, 2020		$	0.7	$	1,092.8	$	(7.8)	$	(118.5)	$	—	$	967.2
Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax		—		1.9		—		—		—		1.9
Stock-based payment expense		—		1.9		—		—		—		1.9
Net loss		—		—		—		(55.4)		—		(55.4)
Other comprehensive income, net of tax		—		—		2.6		—		—		2.6
BALANCES AT JUNE 30, 2020		$	0.7	$	1,096.6	$	(5.2)	$	(173.9)	$	—	$	918.2
Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax		0.1		(3.8)		—		—		—		(3.7)
Stock-based payment expense		—		8.4		—		—		—		8.4
Net loss		—		—		—		(15.2)		—		(15.2)
Other comprehensive income, net of tax		—		—		1.6		—		—		1.6
BALANCES AT SEPTEMBER 30, 2020		$	0.8	$	1,101.2	$	(3.6)	$	(189.1)	$	—	$	909.3
															Common stock		Additional paid-in capital		Accumulated other comprehensive loss		Accumulated deficit		Non-controlling interest		Myriad Genetics, Inc. Stockholders’ equity
BALANCES AT DECEMBER 31, 2020	BALANCES AT DECEMBER 31, 2020	$	0.8	$	1,109.5	$	(2.3)	$	(227.0)	$	—	$	881.0	BALANCES AT DECEMBER 31, 2020	$	0.8	$	1,109.5	$	(2.3)	$	(227.0)	$	—	$	881.0
Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax	Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax	—		26.0		—		—		—		26.0		Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax	—		26.0		—		—		—		26.0
Stock-based payment expense	Stock-based payment expense	—		9.0		—		—		—		9.0		Stock-based payment expense	—		9.0		—		—		—		9.0
Net loss	Net loss	—		—		—		(39.5)		—		(39.5)		Net loss	—		—		—		(39.5)		—		(39.5)
Other comprehensive loss, net of tax	Other comprehensive loss, net of tax	—		—		(1.3)		—		—		(1.3)		Other comprehensive loss, net of tax	—		—		(1.3)		—		—		(1.3)
BALANCES AT MARCH 31, 2021	BALANCES AT MARCH 31, 2021	$	0.8	$	1,144.5	$	(3.6)	$	(266.5)	$	—	$	875.2	BALANCES AT MARCH 31, 2021	$	0.8	$	1,144.5	$	(3.6)	$	(266.5)	$	—	$	875.2
Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax	Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax	—		23.5		—		—		—		23.5		Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax	—		23.5		—		—		—		23.5
Stock-based payment expense	Stock-based payment expense	—		8.9		—		—		—		8.9		Stock-based payment expense	—		8.9		—		—		—		8.9
Non-controlling interest	Non-controlling interest	—		—		—		—		(0.1)		(0.1)		Non-controlling interest	—		—		—		—		(0.1)		(0.1)
Net loss	Net loss	—		—		—		(4.7)		—		(4.7)		Net loss	—		—		—		(4.7)		—		(4.7)
Other comprehensive loss, net of tax	Other comprehensive loss, net of tax	—		—		(0.4)		—		—		(0.4)		Other comprehensive loss, net of tax	—		—		(0.4)		—		—		(0.4)
BALANCES AT JUNE 30, 2021	BALANCES AT JUNE 30, 2021	$	0.8	$	1,176.9	$	(4.0)	$	(271.2)	$	(0.1)	$	902.4	BALANCES AT JUNE 30, 2021	$	0.8	$	1,176.9	$	(4.0)	$	(271.2)	$	(0.1)	$	902.4
Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax	Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax	—		31.9		—		—		—		31.9		Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax	—		31.9		—		—		—		31.9
Stock-based payment expense	Stock-based payment expense	—		10.0		—		—		—		10.0		Stock-based payment expense	—		10.0		—		—		—		10.0
Net income	Net income	—		—		—		24.6		—		24.6		Net income	—		—		—		24.6		—		24.6
Other comprehensive loss, net of tax	Other comprehensive loss, net of tax	—		—		(0.4)		—		—		(0.4)		Other comprehensive loss, net of tax	—		—		(0.4)		—		—		(0.4)
BALANCES AT SEPTEMBER 30, 2021	BALANCES AT SEPTEMBER 30, 2021	$	0.8	$	1,218.8	$	(4.4)	$	(246.6)	$	(0.1)	$	968.5	BALANCES AT SEPTEMBER 30, 2021	$	0.8	$	1,218.8	$	(4.4)	$	(246.6)	$	(0.1)	$	968.5

BALANCES AT DECEMBER 31, 2021														BALANCES AT DECEMBER 31, 2021	$	0.8	$	1,226.3	$	(5.1)	$	(254.2)	$	—	$	967.8
Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax														Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax	—		(4.8)		—		—		—		(4.8)
Stock-based payment expense														Stock-based payment expense	—		10.1		—		—		—		10.1
Net loss														Net loss	—		—		—		(20.5)		—		(20.5)
Other comprehensive loss, net of tax														Other comprehensive loss, net of tax	—		—		(2.5)		—		—		(2.5)
BALANCES AT MARCH 31, 2022														BALANCES AT MARCH 31, 2022	$	0.8	$	1,231.6	$	(7.6)	$	(274.7)	$	—	$	950.1
Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax														Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax	—		2.3		—		—		—		2.3
Stock-based payment expense														Stock-based payment expense	—		10.4		—		—		—		10.4
Net loss														Net loss	—		—		—		(14.1)		—		(14.1)
Other comprehensive loss, net of tax														Other comprehensive loss, net of tax	—		—		(1.3)		—		—		(1.3)
BALANCES AT JUNE 30, 2022														BALANCES AT JUNE 30, 2022	$	0.8	$	1,244.3	$	(8.9)	$	(288.8)	$	—	$	947.4
Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax														Issuance of common stock under stock-based compensation plans, net of shares exchanged for withholding tax	—		(2.7)		—		—		—		(2.7)
Stock-based payment expense														Stock-based payment expense	—		9.4		—		—		—		9.4
Net loss														Net loss	—		—		—		(35.1)		—		(35.1)
Other comprehensive loss, net of tax														Other comprehensive loss, net of tax	—		—		(2.4)		—		—		(2.4)
BALANCES AT SEPTEMBER 30, 2022														BALANCES AT SEPTEMBER 30, 2022	$	0.8	$	1,251.0	$	(11.3)	$	(323.9)	$	—	$	916.6

See accompanying notes to Condensed Consolidated Financial Statements.

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MYRIAD GENETICS, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows (unaudited)

(in millions)


		Nine months ended September 30,					Nine months ended September 30,
		2021		2020			2022		2021
CASH FLOWS FROM OPERATING ACTIVITIES:	CASH FLOWS FROM OPERATING ACTIVITIES:					CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss attributable to Myriad Genetics, Inc. stockholders	Net loss attributable to Myriad Genetics, Inc. stockholders	$	(19.6)	$	(185.8)	Net loss attributable to Myriad Genetics, Inc. stockholders	$	(69.7)	$	(19.6)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:	Adjustments to reconcile net loss to net cash provided by (used in) operating activities:					Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	Depreciation and amortization	49.5		53.3		Depreciation and amortization	39.0		49.5
Non-cash interest expense	Non-cash interest expense	1.3		0.4		Non-cash interest expense	1.1		1.3
Non-cash lease expense	Non-cash lease expense	9.8		9.6		Non-cash lease expense	8.6		9.8
Tenant improvement allowance received						Tenant improvement allowance received	8.6		—
Stock-based compensation expense	Stock-based compensation expense	27.9		17.8		Stock-based compensation expense	29.9		27.9
Deferred income taxes	Deferred income taxes	(27.8)		(0.6)		Deferred income taxes	(22.0)		(27.8)
Unrecognized tax benefits	Unrecognized tax benefits	1.5		14.9		Unrecognized tax benefits	0.1		1.5
Change in fair value of contingent consideration		1.7		(4.5)
Bad debt expense						Bad debt expense	1.3		0.2
Loss on inventory	Loss on inventory	6.5		—		Loss on inventory	—		6.5
Impairment of goodwill and long-lived assets	Impairment of goodwill and long-lived assets	1.8		98.4		Impairment of goodwill and long-lived assets	10.7		1.8
Gain on sale of businesses and assets		(162.0)		(1.0)
Gain on sale of assets						Gain on sale of assets	—		(162.0)
Changes in assets and liabilities:	Changes in assets and liabilities:					Changes in assets and liabilities:
Prepaid expenses and other current assets	Prepaid expenses and other current assets	(6.7)		5.4		Prepaid expenses and other current assets	0.4		(6.7)
Trade accounts receivable	Trade accounts receivable	(11.6)		33.3		Trade accounts receivable	(12.8)		(11.8)
Inventory	Inventory	(1.6)		1.7		Inventory	(4.4)		(1.6)
Prepaid taxes	Prepaid taxes	108.0		(83.2)		Prepaid taxes	0.5		108.0
Other assets	Other assets	(3.6)		(1.2)		Other assets	(0.5)		(3.6)
Accounts payable	Accounts payable	(4.8)		(2.6)		Accounts payable	(1.1)		(4.8)
Accrued liabilities		78.2		3.1
Accrued expenses and other liabilities						Accrued expenses and other liabilities	(83.4)		79.9
Deferred revenues	Deferred revenues	(20.4)		28.5		Deferred revenues	(4.9)		(20.4)
Net cash provided by (used in) operating activities	Net cash provided by (used in) operating activities	28.1		(12.5)		Net cash provided by (used in) operating activities	(98.6)		28.1
CASH FLOWS FROM INVESTING ACTIVITIES:	CASH FLOWS FROM INVESTING ACTIVITIES:					CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	Capital expenditures	(14.6)		(6.8)		Capital expenditures	(30.7)		(14.6)
Proceeds from sale of businesses and assets		379.1		21.3
Proceeds from sale of assets						Proceeds from sale of assets	—		379.1
Purchases of marketable investment securities	Purchases of marketable investment securities	(101.0)		(15.8)		Purchases of marketable investment securities	(98.8)		(101.0)
Proceeds from maturities and sales of marketable investment securities	Proceeds from maturities and sales of marketable investment securities	36.8		51.9		Proceeds from maturities and sales of marketable investment securities	87.6		36.8
Net cash provided by investing activities		300.3		50.6
Net cash provided by (used in) investing activities						Net cash provided by (used in) investing activities	(41.9)		300.3
CASH FLOWS FROM FINANCING ACTIVITIES:	CASH FLOWS FROM FINANCING ACTIVITIES:					CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from common stock issued under stock-based compensation plans	Proceeds from common stock issued under stock-based compensation plans	90.0		2.2		Proceeds from common stock issued under stock-based compensation plans	3.9		90.0
Payment of tax withheld for common stock issued under stock-based compensation plans	Payment of tax withheld for common stock issued under stock-based compensation plans	(8.6)		(3.9)		Payment of tax withheld for common stock issued under stock-based compensation plans	(9.1)		(8.6)
Payment of contingent consideration recognized at acquisition	Payment of contingent consideration recognized at acquisition	(3.3)		(0.1)		Payment of contingent consideration recognized at acquisition	—		(3.3)
Fees associated with refinancing of revolving credit facility	Fees associated with refinancing of revolving credit facility	(1.2)		(1.0)		Fees associated with refinancing of revolving credit facility	(0.7)		(1.2)
Repayment of revolving credit facility	Repayment of revolving credit facility	(226.4)		—		Repayment of revolving credit facility	—		(226.4)
Net cash used in financing activities	Net cash used in financing activities	(149.5)		(2.8)		Net cash used in financing activities	(5.9)		(149.5)
Effect of foreign exchange rates on cash and cash equivalents	Effect of foreign exchange rates on cash and cash equivalents	(0.7)		0.3		Effect of foreign exchange rates on cash and cash equivalents	(1.3)		(0.7)
Change in cash and cash equivalents classified as held for sale		—		1.5
Net increase in cash and cash equivalents		178.2		37.1
Net increase (decrease) in cash and cash equivalents						Net increase (decrease) in cash and cash equivalents	(147.7)		178.2
Cash and cash equivalents at beginning of the period	Cash and cash equivalents at beginning of the period	117.0		81.2		Cash and cash equivalents at beginning of the period	258.4		117.0
Cash and cash equivalents at end of the period	Cash and cash equivalents at end of the period	$	295.2	$	118.3	Cash and cash equivalents at end of the period	$	110.7	$	295.2

See accompanying notes to Condensed Consolidated Financial Statements.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.BASIS OF PRESENTATION

Myriad Genetics, Inc. and its subsidiaries (collectively, the “Company” or “Myriad”) ~~discover~~is a leading genetic testing and commercialize genetic tests that determine the risk of developing disease, assess the risk of disease progression, and guide treatment decisions across medical specialties where critical genetic insights can significantly improve patient care and lower healthcare costs. The Company's mission and purpose isprecision medicine company dedicated to ~~advance~~advancing health and well-being for ~~all, empower individuals with vital genetic~~all. 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 or guide treatment decisions across medical specialties. The Company generates revenue by performing molecular diagnostic tests and, prior to the sale of Myriad RBM, Inc. on July 1, 2021, ~~as described in Note 16,~~ by providing pharmaceutical 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 ~~corporate headquarters are~~principal executive office is located in Salt Lake City, Utah.

The accompanying Condensed Consolidated Financial Statements for the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and pursuant to the applicable rules and regulations of the Securities and Exchange Commission (“SEC”). All intercompany accounts and transactions have been eliminated in consolidation. In the opinion of management, the accompanying financial statements contain all adjustments (consisting of normal and recurring accruals) necessary to present fairly all financial statements in accordance with GAAP. The Condensed Consolidated Financial Statements herein should be read in conjunction with the Company’s audited Consolidated Financial Statements and notes thereto included in the Company’s ~~Transition~~Annual Report on Form 10-K for the ~~transition period~~year ended December 31, ~~2020~~2021 (the ~~“Transition Report on Form~~“Form 10-K”).

The preparation of financial statements in conformity 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 financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Operating results for the three and nine months ended September 30, ~~2021~~2022 may not necessarily be indicative of results to be expected for any other interim period or for the full year.

The Company has historically experienced seasonality in its testing business. The volume of testing is negatively impacted by the summer season, which is generally reflected in the quarter ~~ending June 30 and the quarter ending~~ended September 30. The quarter ~~ending~~ended December 31 is generally strong as the Company ~~sees~~typically experiences an increase in volumes from patients who have met their annual insurance deductible. ~~Conversely,~~In the ~~quarter ending~~quarters ended March 31, isthe Company has typically ~~negatively impacted by~~experienced a decrease in volumes due to the annual reset of patient deductibles.

Due to the COVID-19 global pandemic, including variants of COVID-19 (“COVID-19”), seasonality may not follow the same pattern as in prior years. Volumes and results of operations were impacted negatively in calendar year ~~2020~~2021 and early 2022 by COVID-19. As such, the Company’s year over year results may not be comparable. Management continues to monitor the impact of COVID-19 on the Company’s financial condition, liquidity, operations, suppliers, industry, and workforce. Given the variants of COVID-19 that have surfaced around the world, the Company is not able to fully estimate the effects of COVID-19 on results of operations, financial condition, or liquidity for future periods.

Reclassifications

Certain prior period amounts have been reclassified to conform with the current ~~period~~period's presentation. The reclassifications have no impact on the total assets, total liabilities, stockholders’ equity, cash flows from operations, or net ~~income (loss)~~loss for the period.

~~Recent Accounting Pronouncements~~

~~Recently Adopted Standards~~

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”). ASU 2019-12 is a new accounting standard to simplify accounting for income taxes and remove, modify, and add to the disclosure requirements of income taxes. The standard is effective for fiscal years beginning after December 15, 2020, with early adoption permitted. This guidance was adopted ~~with no material impact to the Company's Condensed Consolidated Financial Statements.~~

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2.REVENUE

Myriad primarily generates revenue by performing molecular diagnostic ~~testing, and prior to the sale of Myriad RBM, Inc. on July 1, 2021, pharmaceutical services.~~testing. Molecular diagnostic revenues ~~consists of~~are primarily derived from the following categories ~~(products):~~of products: Hereditary Cancer (myRisk, BRACAnalysis, BRACAnalysis CDx), Tumor Profiling ~~(myChoice~~(MyChoice CDx, Prolaris, and EndoPredict), Prenatal (Foresight and Prequel), and Pharmacogenomics (GeneSight)~~, Autoimmune (Vectra), and Other.~~. The Company previously provided pharmaceutical services and clinical services prior to the sale of Myriad RBM, Inc. in July 2021 and Privatklinik Dr. Robert Schindlbeck GmbH & Co. KG ~~(the “Clinic”),~~in February 2020, respectively. Prior to the sale of the Myriad myPath, LLC laboratory in May 2021 and ~~select assets of~~ the Myriad Autoimmune ~~(Vectra)~~ business ~~unit~~ in September 2021, the associated revenue from such businesses was included within Molecular diagnostic revenues. ~~See Note 16 for a discussion of these divestitures.~~ Revenue is recorded at the estimated ~~amount of consideration to be received.~~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.

The following table presents detail regarding the composition of the Company’s total revenue by ~~category~~type and by U.S. versus rest of world (“RoW”):


		Three months ended September 30,													Three months ended September 30,
		2021						2020							2022						2021
(in millions)	(in millions)	U.S.		RoW		Total		U.S.		RoW		Total		(in millions)	U.S.		RoW		Total		U.S.		RoW		Total
Molecular diagnostic revenues:	Molecular diagnostic revenues:													Molecular diagnostic revenues:
Hereditary Cancer	Hereditary Cancer	$	68.2	$	11.2	$	79.4	$	72.0	$	8.5	$	80.5	Hereditary Cancer	$	60.2	$	10.3	$	70.5	$	68.2	$	11.2	$	79.4
Tumor Profiling	Tumor Profiling	21.4		11.5		32.9		14.4		2.6		17.0		Tumor Profiling	20.2		10.6		30.8		21.3		11.6		32.9
Prenatal	Prenatal	23.5		0.1		23.6		16.5		0.1		16.6		Prenatal	21.9		0.2		22.1		23.5		0.1		23.6
Pharmacogenomics	Pharmacogenomics	24.1		—		24.1		11.9		—		11.9		Pharmacogenomics	33.0		—		33.0		24.1		—		24.1
Autoimmune	Autoimmune	7.3		—		7.3		9.1		—		9.1		Autoimmune	—		—		—		7.3		—		7.3
Other		—		—		—		0.6		—		0.6

Total molecular diagnostic revenue	Total molecular diagnostic revenue	144.5		22.8		167.3		124.5		11.2		135.7		Total molecular diagnostic revenue	135.3		21.1		156.4		144.4		22.9		167.3
Pharmaceutical and clinical services revenue		—		—		—		9.5		—		9.5

Total revenue	Total revenue	$	144.5	$	22.8	$	167.3	$	134.0	$	11.2	$	145.2	Total revenue	$	135.3	$	21.1	$	156.4	$	144.4	$	22.9	$	167.3

		Nine months ended September 30,													Nine months ended September 30,
		2021						2020							2022						2021
(in millions)	(in millions)	U.S.		RoW		Total		U.S.		RoW		Total		(in millions)	U.S.		RoW		Total		U.S.		RoW		Total
Molecular diagnostic revenues:	Molecular diagnostic revenues:													Molecular diagnostic revenues:
Hereditary Cancer	Hereditary Cancer	$	207.1	$	34.4	$	241.5	$	188.2	$	17.4	$	205.6	Hereditary Cancer	$	190.6	$	30.0	$	220.6	$	207.1	$	34.4	$	241.5
Tumor Profiling	Tumor Profiling	63.9		30.5		94.4		33.7		7.5		41.2		Tumor Profiling	61.4		35.5		96.9		63.4		31.0		94.4
Prenatal	Prenatal	76.3		0.4		76.7		53.2		0.3		53.5		Prenatal	86.7		0.6		87.3		76.3		0.4		76.7
Pharmacogenomics	Pharmacogenomics	64.3		—		64.3		40.8		—		40.8		Pharmacogenomics	95.5		—		95.5		64.3		—		64.3
Autoimmune	Autoimmune	28.2		—		28.2		26.8		—		26.8		Autoimmune	0.3		—		0.3		28.2		—		28.2
Other	Other	—		0.5		0.5		1.6		—		1.6		Other	—		—		—		0.5		—		0.5
Total molecular diagnostic revenue	Total molecular diagnostic revenue	439.8		65.8		505.6		344.3		25.2		369.5		Total molecular diagnostic revenue	434.5		66.1		500.6		439.8		65.8		505.6
Pharmaceutical and clinical services revenue	Pharmaceutical and clinical services revenue	24.2		—		24.2		29.0		3.9		32.9		Pharmaceutical and clinical services revenue	—		—		—		24.2		—		24.2
Total revenue	Total revenue	$	464.0	$	65.8	$	529.8	$	373.3	$	29.1	$	402.4	Total revenue	$	434.5	$	66.1	$	500.6	$	464.0	$	65.8	$	529.8

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The Company performs its obligation under a contract with a customer by processing diagnostic tests and communicating 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. ~~Included within the Company's deferred revenues are advance Medicare payments.~~ During the fiscal year ended June 30, 2020, the Company received approximately $29.7 million in advance Medicare payments to provide relief from the economic impacts of COVID-19 on the Company. The advanced Medicare payments ~~began being~~were applied against services performed beginning in April 2021 and ~~will continue~~continued until the funds previously received ~~are~~were fully ~~earned.~~earned, which occurred during the quarter ended March 31, 2022. A reconciliation of the beginning and ending balances of deferred ~~revenues~~revenue is shown in the table below:


		Nine months ended September 30,					Nine months ended September 30,
(in millions)	(in millions)	2021		2020		(in millions)	2022		2021
Deferred revenues - beginning balance		$	32.7	$	3.6
Deferred revenue - beginning balance						Deferred revenue - beginning balance	$	5.2	$	32.7
Revenue recognized	Revenue recognized	(30.3)		(8.4)		Revenue recognized	(5.3)		(30.3)
Prepayments	Prepayments	10.1		37.1		Prepayments	0.3		10.1
Divestitures		$	(1.0)	$	—
Deferred revenues - ending balance		$	11.5	$	32.3
Held for sale reclassification						Held for sale reclassification	—		(1.0)
Deferred revenue - ending balance						Deferred revenue - ending balance	$	0.2	$	11.5

In accordance with ASC Topic 606, Revenue from Contracts with Customers, 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. 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. An estimate of transaction price does not include any estimated amount of variable consideration that is constrained. In addition, the Company considers all the information (historical, current, and forecast) that is reasonably available to identify possible consideration amounts. ~~The~~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. 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 Company’s Condensed 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 Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

Cash collections for certain diagnostic tests delivered may differ from rates ~~originally~~ 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. During the three and nine months ended September 30, ~~2021,~~2022, the Company recognized ~~$7.6~~$(5.3) million and ~~$16.6~~$20.1 million in revenue, respectively, which resulted in a ~~$0.07 impact~~$(0.05) and ~~$0.16~~$0.19 impact to earnings per share, respectively, for tests in which the performance obligation of delivering the tests results was met in prior periods. The changes were primarily driven by changes in the estimated transaction price. Additionally, during the three months ended March 31, 2021, the Company recognized $6.8 million of revenue due to expanded coverage for Prolaris, for which revenue was fully constrained in a prior period.

The Company applies the practical expedient related to costs to obtain or fulfill a contract since the amortization period for such costs will be one year or less. 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.

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Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. Substantially all of the Company’s accounts receivable are with companies in the healthcare industry, U.S. and state governmental agencies, ~~that make payments on the customer's behalf,~~ and individuals. The Company does not believe that receivables due from U.S. and state governmental agencies, such as Medicare, represent a credit risk since the related healthcare programs are funded by the U.S. and state governments. The Company only has one payor, Medicare, ~~that~~which represents greater than 10% of its revenues. Revenues received from Medicare represented ~~approximately~~15% and 14% of total revenue for the three and nine months ended September 30, 2022, respectively, and 17% of total revenue for each of the three and nine months ended September 30, ~~2021, and 16% and 15% of total revenue for the three and nine months ended September 30, 2020, respectively.~~2021. Concentrations of credit risk are mitigated due to the number of the Company’s customers as well as their dispersion across many geographic regions. No payor accounted for more than 10% of accounts receivable at September 30, ~~2021~~2022 or December 31, ~~2020.~~2021. The Company does not require collateral from its customers.

3.MARKETABLE INVESTMENT SECURITIES

The amortized cost, gross unrealized holding gains, gross unrealized holding losses, and fair value for available-for-sale securities by major security type and class of security at September 30, ~~2021~~2022 and December 31, ~~2020~~2021 were as follows:


(in millions)	(in millions)	Amortized cost		Gross unrealized holding gains		Gross unrealized holding losses		Estimated fair value		(in millions)	Amortized cost		Gross unrealized holding gains		Gross unrealized holding losses		Estimated fair value
September 30, 2021
September 30, 2022										September 30, 2022
Cash and cash equivalents:	Cash and cash equivalents:									Cash and cash equivalents:
Cash	Cash	$	208.8	$	—	$	—	$	208.8	Cash	$	57.8	$	—	$	—	$	57.8
Cash equivalents	Cash equivalents	86.4		—		—		86.4		Cash equivalents	52.9		—		—		52.9
Total cash and cash equivalents	Total cash and cash equivalents	295.2		—		—		295.2		Total cash and cash equivalents	110.7		—		—		110.7
Available-for-sale:	Available-for-sale:									Available-for-sale:
Corporate bonds and notes	Corporate bonds and notes	90.7		0.2		(0.1)		90.8		Corporate bonds and notes	82.2		—		(1.9)		80.3
Municipal bonds	Municipal bonds	19.4		0.1		—		19.5		Municipal bonds	23.9		—		(0.4)		23.5
Federal agency issues	Federal agency issues	2.6		—		—		2.6		Federal agency issues	23.8		—		(0.7)		23.1
US government securities		5.5		—		—		5.5
U.S. government securities										U.S. government securities	21.8		—		(0.2)		21.6
Total	Total	$	413.4	$	0.3	$	(0.1)	$	413.6	Total	$	262.4	$	—	$	(3.2)	$	259.2


(in millions)	(in millions)	Amortized cost		Gross unrealized holding gains		Gross unrealized holding losses		Estimated fair value		(in millions)	Amortized cost		Gross unrealized holding gains		Gross unrealized holding losses		Estimated fair value
December 31, 2020:
December 31, 2021										December 31, 2021
Cash and cash equivalents:	Cash and cash equivalents:									Cash and cash equivalents:
Cash	Cash	$	47.9	$	—	$	—	$	47.9	Cash	$	195.2	$	—	$	—	$	195.2
Cash equivalents	Cash equivalents	69.1		—		—		69.1		Cash equivalents	63.2		—		—		63.2
Total cash and cash equivalents	Total cash and cash equivalents	117.0		—		—		117.0		Total cash and cash equivalents	258.4		—		—		258.4
Available-for-sale:	Available-for-sale:									Available-for-sale:
Corporate bonds and notes	Corporate bonds and notes	28.8		0.5		—		29.3		Corporate bonds and notes	105.7		0.1		(0.2)		105.6
Municipal bonds	Municipal bonds	9.4		0.2		—		9.6		Municipal bonds	16.1		—		—		16.1
Federal agency issues	Federal agency issues	4.0		—		—		4.0		Federal agency issues	6.8		—		—		6.8
US government securities		11.7		0.1		—		11.8
U.S. government securities										U.S. government securities	11.9		—		—		11.9
Total	Total	$	170.9	$	0.8	$	—	$	171.7	Total	$	398.9	$	0.1	$	(0.2)	$	398.8

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Cash, cash equivalents, and maturities of debt securities classified as available-for-sale securities were as follows at September 30, ~~2021:~~2022:

(in millions) Amortized
cost Estimated
fair value
Cash $ 208.8 $ 208.8
Cash equivalents 86.4 86.4
Available-for-sale:
Due within one year 70.7 70.9
Due after one year through five years 47.5 47.5
Due after five years — —
Total $ 413.4 $ 413.6

~~There were no debt securities classified as available-for-sale in a gross unrealized loss position as of September 30, 2021 or December 31, 2020.~~


(in millions)	Amortized cost		Estimated fair value
Cash	$	57.8	$	57.8
Cash equivalents	52.9		52.9
Available-for-sale:
Due within one year	83.4		82.5
Due after one year through five years	68.3		66.0
Due after five years	—		—
Total	$	262.4	$	259.2

Additional information relating to fair value of marketable investment securities can be found in Note 4.

4.FAIR VALUE MEASUREMENTS

The fair value of the Company’s financial instruments reflects the amounts that the Company estimates it will receive in connection with the sale of an asset or pay in connection with the transfer of a liability in an orderly transaction between market participants at the measurement date (exit price). The fair value hierarchy prioritizes the use of inputs used in valuation techniques into the following three levels:

Level 1—quoted prices in active markets for identical assets and liabilities.

Level 2—observable inputs other than quoted prices in active markets for identical assets and liabilities; quoted prices in markets that are not active; 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.

Level 3—unobservable inputs.

All of the Company’s financial instruments are valued using quoted prices in active markets or based on other observable inputs. 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, the Company reassesses the fair value of 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 earn out liability. This fair value measurement is considered a Level 3 measurement because the Company estimates projections during the expected measurement period of approximately ~~13.8~~12.75 years, utilizing various potential pay-out scenarios. 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 earn-out itself, the related projections, and the overall business. The contingent earn-out liabilities are classified as components of Accrued liabilities and Other long-term liabilities in the Company’s Condensed Consolidated Balance Sheets. Changes to contingent consideration liabilities are reflected in ~~Change in the fair value of contingent consideration~~Selling, general and administrative expense in the Company’s Condensed Consolidated Statements of Operations. Changes to the unobservable inputs could have a material impact on the Company’s financial statements.

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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)	(in millions)	Level 1		Level 2		Level 3		Total		(in millions)	Level 1		Level 2		Level 3		Total
September 30, 2021
September 30, 2022										September 30, 2022
Money market funds (a)	Money market funds (a)	$	86.4	$	—	$	—	$	86.4	Money market funds (a)	$	52.9	$	—	$	—	$	52.9
Corporate bonds and notes	Corporate bonds and notes	—		90.8		—		90.8		Corporate bonds and notes	—		80.3		—		80.3
Municipal bonds	Municipal bonds	—		19.5		—		19.5		Municipal bonds	—		23.5		—		23.5
Federal agency issues	Federal agency issues	—		2.6		—		2.6		Federal agency issues	—		23.1		—		23.1
US government securities		—		5.5		—		5.5
U.S. government securities										U.S. government securities	—		21.6		—		21.6
Contingent consideration	Contingent consideration	—		—		(8.8)		(8.8)		Contingent consideration	—		—		(7.2)		(7.2)
Total	Total	$	86.4	$	118.4	$	(8.8)	$	196.0	Total	$	52.9	$	148.5	$	(7.2)	$	194.2

(a)Money market funds are primarily comprised of exchange traded funds and accrued interest.


(in millions)	(in millions)	Level 1		Level 2		Level 3		Total		(in millions)	Level 1		Level 2		Level 3		Total
December 31, 2020
December 31, 2021										December 31, 2021
Money market funds (a)	Money market funds (a)	$	69.1	$	—	$	—	$	69.1	Money market funds (a)	$	63.2	$	—	$	—	$	63.2
Corporate bonds and notes	Corporate bonds and notes	—		29.3		—		29.3		Corporate bonds and notes	—		105.6		—		105.6
Municipal bonds	Municipal bonds	—		9.6		—		9.6		Municipal bonds	—		16.1		—		16.1
Federal agency issues	Federal agency issues	—		4.0		—		4.0		Federal agency issues	—		6.8		—		6.8
US government securities		—		11.8		—		11.8
U.S. government securities										U.S. government securities	—		11.9		—		11.9
Contingent consideration	Contingent consideration	—		—		(10.9)		(10.9)		Contingent consideration	—		—		(8.6)		(8.6)
Total	Total	$	69.1	$	54.7	$	(10.9)	$	112.9	Total	$	63.2	$	140.4	$	(8.6)	$	195.0

(a)Money market funds are primarily comprised of exchange traded funds and accrued interest.

The following table reconciles the change in the fair value of the contingent consideration during the periods presented:


(in millions)	Carrying Amount
Balance December 31, ~~2020~~2021	$	~~10.9~~
~~Payment of contingent consideration~~	~~(3.3)~~8.6
Change in fair value recognized in the ~~income statement~~Statement of Operations	~~1.7~~ (0.2)
Translation adjustments recognized in ~~other~~Other comprehensive ~~loss~~income (loss)	~~(0.5)~~(1.2)
Ending balance September 30, ~~2021~~2022	$	~~8.8~~7.2

5.PROPERTY, PLANT AND EQUIPMENT, NET


(in millions)	(in millions)	September 30, 2021		December 31, 2020		(in millions)	September 30, 2022		December 31, 2021
Leasehold improvements	Leasehold improvements	$	38.1	$	35.7	Leasehold improvements	$	55.5	$	38.0
Equipment	Equipment	110.3		117.9		Equipment	120.5		112.4
Property, plant and equipment, gross	Property, plant and equipment, gross	148.4		153.6		Property, plant and equipment, gross	176.0		150.4
Less accumulated depreciation	Less accumulated depreciation	(105.0)		(112.9)		Less accumulated depreciation	(108.5)		(106.9)
Property, plant and equipment, net	Property, plant and equipment, net	$	43.4	$	40.7	Property, plant and equipment, net	$	67.5	$	43.5

~~The change in~~During the three months ended March 31, 2022, the Company ceased the use of one of its leased Salt Lake City facilities. As a result, the Company recognized a $2.1 million impairment on the property, plant and equipment ~~from December 31, 2020 to September 30, 2021 was~~associated with the lease, which consisted primarily ~~due to the sales~~ of ~~Myriad RBM, Inc. and select assets of the Myriad Autoimmune business.~~leasehold improvements. See Note 1615 for ~~additional information on these divestitures.~~further discussion.


		Three months ended September 30,				Nine months ended September 30,					Three months ended September 30,				Nine months ended September 30,
(in millions)	(in millions)	2021		2020		2021		2020		(in millions)	2022		2021		2022		2021
Depreciation expense	Depreciation expense	$	2.6	$	2.4	$	8.9	$	7.5	Depreciation expense	$	2.9	$	2.6	$	8.5	$	8.9

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6.GOODWILL AND INTANGIBLE ASSETS

Goodwill

The following table summarizes the changes in the carrying amount of goodwill for the nine months ended September 30, ~~2021:~~2022:

(in millions) Diagnostic Other Total
Beginning balance $ 272.3 $ 56.9 $ 329.2
Divestitures (31.6) (56.9) (88.5)
Translation adjustments (1.0) — (1.0)
Ending balance $ 239.7 $ — $ 239.7

During the quarter ended September 30, 2021, the Company completed the sale of Myriad RBM, Inc. and select operating assets and intellectual property, including the Vectra® test, from the Myriad Autoimmune business unit. See Note 16 for additional information on these divestitures.


(in millions)	Total
Beginning balance	$	239.2
Translation adjustments	(2.7)
Ending balance	$	236.5

Intangible Assets

Intangible assets ~~have primarily consisted of amortizable assets~~consists of purchased licenses and technologies, customer relationships, and trade names as well as non-amortizable intangible assets of in-process technologies and research and development. As of September 30, 2021, the Company's intangible assets consist of only purchased licenses and technologies due to the completion of the sales of Myriad RBM, Inc. and select operating assets and intellectual property, including the Vectra® test, from the Myriad Autoimmune business unit. In connection with these sales, the Company sold $199.1 million in purchased licenses and technologies, $4.8 million in-process research and development intangible assets, $4.7 million in customer relationships, and $3.0 million in trademarks, resulting in an aggregate decrease of intangible assets of $120.0 million, net of $91.6 million in accumulated amortization. See Note 16 for additional information on these divestitures.technologies. The following summarizes the amounts reported as intangible assets:


(in millions)	(in millions)	Gross Carrying Amount		Accumulated Amortization		Net		(in millions)	Gross Carrying Amount		Accumulated Amortization		Net
At September 30, 2021:
At September 30, 2022								At September 30, 2022
Purchased licenses and technologies	Purchased licenses and technologies	$	617.4	$	(202.6)	$	414.8	Purchased licenses and technologies	$	612.4	$	(241.6)	$	370.8
Total amortized intangible assets		617.4		(202.6)		414.8
Total intangible assets	Total intangible assets	$	617.4	$	(202.6)	$	414.8	Total intangible assets	$	612.4	$	(241.6)	$	370.8

(in millions) Gross
Carrying
Amount Accumulated
Amortization Net
At December 31, 2020:
Purchased licenses and technologies $ 818.2 $ (248.2) $ 570.0
Customer relationships 4.7 (4.5) 0.2
Trademarks 3.0 (1.5) 1.5
Total amortized intangible assets 825.9 (254.2) 571.7
In-process research and development 4.8 — 4.8
Total unamortized intangible assets 4.8 — 4.8
Total intangible assets $ 830.7 $ (254.2) $ 576.5


(in millions)	Gross Carrying Amount		Accumulated Amortization		Net
At December 31, 2021
Purchased licenses and technologies	$	616.6	$	(212.5)	$	404.1
Total intangible assets	$	616.6	$	(212.5)	$	404.1

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


		Three months ended September 30,				Nine months ended September 30,					Three months ended September 30,				Nine months ended September 30,
(in millions)	(in millions)	2021		2020		2021		2020		(in millions)	2022		2021		2022		2021
Amortization of intangible assets	Amortization of intangible assets	$	11.6	$	15.3	$	40.6	$	45.8	Amortization of intangible assets	$	10.2	$	11.6	$	30.5	$	40.6

7.ACCRUED LIABILITIES


(in millions)	September 30, 2022		December 31, 2021
Employee compensation and benefits	$	42.6��	$	52.8
Legal charges pending settlement	—		62.0
Accrued taxes payable	3.8		4.0
Refunds payable and reserves	11.0		9.8
Short-term contingent consideration	2.7		3.2
Accrued royalties	4.7		5.4
Other accrued liabilities	20.5		19.3
Total accrued liabilities	$	85.3	$	156.5

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7.~~ACCRUED LIABILITIES~~

(in millions) September 30,
2021 December 31,
2020
Employee compensation and benefits $ 54.0 $ 48.9
Legal accrual 48.0 —
Accrued taxes payable 17.3 4.3
Refunds payable and reserves 8.9 9.3
Short-term contingent consideration 3.3 3.4
Accrued royalties 5.0 3.8
Purchase commitment 5.2 —
Other accrued liabilities 21.5 9.4
Total accrued liabilities $ 163.2 $ 79.1

~~During the quarter ended September 30, 2021, the Company accrued $48.0 million for a potential settlement of the qui tam lawsuit against Crescendo Bioscience, Inc. and the Company. Refer to Note 13~~ ~~for additional information~~.

8.LONG-TERM DEBT

On December 23, 2016, the Company entered into a senior secured revolving credit facility (the “Facility”) ~~by and among Myriad,~~ as borrower, ~~and~~with the lenders from time to time party thereto. On July 31, 2018, the Company entered into Amendment No. 1 to the Facility, which effected an “amend and extend” transaction with respect to the Facility by which the maturity date thereof was extended to July 31, 2023 (the "Maturity Date") and the maximum aggregate principal commitment was increased from $300.0 million to $350.0 million. On May 1, 2020, the Company entered into Amendment No. 2 to the Facility, which waived the Company’s compliance with certain ~~financial covenants, amended compliance with certain operating~~ covenants and modified the interest rate and other terms during athe modification period from March 31, 2020 through June 30, 2021 ~~(the~~(as modified, the “Modification Period”). This included a modification to the Facility's compliance with the leverage covenant and the interest coverage ratio covenant, which were waived through March 31, 2021, as well as revision to certain negative covenants of the Facility during the Modification Period. On February 22, 2021, the Company entered into Amendment No. 3 ~~(the “Amended Facility”),~~to the Facility, which ~~among other things,~~waived compliance with the leverage ratio and the interest coverage ratio covenants through the quarter ended March 31, 2022 and also lowered the minimum liquidity covenant, which was added by Amendment No. 2, to $150.0 million, and made it applicable through such quarter. Amendment No. 3 also restricted the Company from borrowing under the Facility if unrestricted cash, cash equivalents and marketable investment securities exceed $150.0 million, unless such borrowings are in connection with permitted acquisitions, decreased the maximum aggregate principal commitment from $350.0 million to $300.0 million, with a further reduction in the maximum aggregate principal commitment from $300.0 million to $250.0 million by September 30, 2021, (if not previously reduced to such amount in connection with certain specified asset sales), waived the Company’s compliance with certain financial covenants through the quarter ending March 31, 2022, extended the Modification Period for an additional year through June 30, 2022, and revised certain negative covenants in connection with the extension. The amendments were accounted for as modifications pursuant to guidance in ASC 470-50, Debt.

The Amended Facility contains customary loan terms, interest rates, representations and warranties, affirmative and negative covenants, in each case, subject to customary limitations, exceptions and exclusions. The Amended Facility also contains certain customary events of default. On July 26, 2022, the Company entered into Amendment No. ~~2 modified~~4 to the Facility ~~to increase the interest rate to be fixed at a spread of LIBOR plus 350 basis points on drawn balance and the undrawn fee was increased to 50 basis points during the Modification Period. At the end of~~(the "Amended Facility"), which extended the Modification Period through the Maturity Date, decreased the maximum aggregate principal commitment from $250.0 million to $200.0 million, with a further reduction to $150.0 million by December 31, 2022, waived compliance with the leverage ratio and interest ~~rates return~~coverage ratio covenants through the Maturity Date, and provided for monthly reporting of the Company's liquidity if the total revolving credit exposure is greater than $0, without giving effect to the ~~previous pricing based on a spread~~dollar amount of ~~LIBOR plus 150-250 basis points on drawn balances and an undrawn fee ranging from 25 to 45 basis points,~~any letter of credit exposure not in ~~each case, based on the Company's leverage ratio. The LIBOR floor was also increased to 1.0% during the Modification Period.~~excess of $5.0 million.

Covenants in the Amended Facility impose operating and financial restrictions on the Company. These restrictions may prohibit or place limitations on, among other things, the Company’s ability to incur additional indebtedness, create certain types of liens, and complete mergers, consolidations, or change in control transactions. The Amended Facility may also prohibit or place limitations on the Company’s ability to sell assets, pay dividends or provide other distributions to stockholders. ~~Beginning with the quarter ended June 30, 2022, the Company must maintain specified leverage~~

The Amended Facility contains customary loan terms, interest rates, representations and ~~interest ratios measured as~~warranties, affirmative and negative covenants, in each case, subject to customary limitations, exceptions and exclusions. The Amended Facility also contains certain customary events of ~~the end of each quarter as a financial covenant in the Amended Facility.~~default. Amendment No. 2 modified the Amended ~~Facility's compliance with~~Facility to increase the ~~leverage covenant~~interest rate to be fixed at a spread of LIBOR plus 350 basis points on drawn balances and the ~~interest coverage ratio covenant, which were waived through March 31, 2021. Amendment No. 2 also revised certain negative covenants of the Amended Facility~~undrawn fee was increased to 50 basis points during the Modification Period. Amendment No. ~~3 waived compliance~~4 replaced the option to make Eurodollar borrowings, which bore interest by reference to the LIBOR rate, with term benchmark loans, which will bear interest by reference to the ~~leverage ratio and the interest coverage ratio covenants through the quarter ending March 31, 2022 and also lowered the minimum liquidity covenant, which was added by~~secured overnight financing rate ("SOFR"). Amendment No. 2,4 did not modify the applicable margins and undrawn fee amounts. The interest rate for term benchmark loans continues to ~~$150.0 million,~~be fixed at a spread of SOFR plus 350 basis points on drawn balances and made it applicable through such quarter. Amendment No. 3 restricted the Company from borrowing under the Amended Facility if unrestricted cash and cash equivalents exceed $150.0 million, unless such borrowings are in connection with acquisitions.undrawn fees continue to be 50 basis points. The ~~Company~~SOFR floor was ~~in compliance with all applicable financial covenants at September 30, 2021.~~

~~Table of Contents~~

revised to 0.0%.

During the ~~nine months~~year ended ~~September 30,~~December 31, 2021, the Company made principal repayments totaling $226.4 ~~million on the Amended Facility, including a voluntary principal payment on July 30, 2021 of $106.4~~ million to pay off the remaining outstanding balances on the Amended Facility. As a result, the Company had no outstanding balances under the Amended Facility as of September 30, ~~2021. During the transition period ended~~2022 and December 31, 2020, the Company did not make any principal repayments. The $1.8 million long-term debt discount associated with the Amended Facility is recorded to Other assets in the Condensed Consolidated Balance Sheet. The Company's maximum aggregate principal commitment on its Amended Facility is $250.0 million as of September 30, 2021.

~~As of December 31, 2020, the Company had a long-term debt balance of $224.8 million, net of a $1.9 million long-term debt discount.~~

9.OTHER LONG-TERM LIABILITIES


(in millions)	(in millions)	September 30, 2021		December 31, 2020		(in millions)	September 30, 2022		December 31, 2021
Contingent consideration	Contingent consideration	$	5.5	$	7.4	Contingent consideration	$	4.5	$	5.4
Other	Other	5.3		7.3		Other	0.1		0.2
Total other long-term liabilities	Total other long-term liabilities	$	10.8	$	14.7	Total other long-term liabilities	$	4.6	$	5.6

The Company's balance of other long-term liabilities ~~as of~~at September 30, ~~2021~~2022 and December 31, ~~2020~~2021 consisted primarily ~~consists~~ of the ~~Company’s~~long-term portion of ~~social security taxes that have been deferred under~~contingent consideration related to the ~~Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) that do not have to be remitted until December 2022.~~acquisition of Sividon Diagnostics.

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10.PREFERRED AND COMMON STOCKHOLDERS' EQUITY

The Company is authorized to issue up to 5.0 million shares of preferred stock, par value $0.01 per share. There were no shares of preferred ~~shares~~stock outstanding at September 30, ~~2021.~~2022.

The Company is authorized to issue up to 150.0 million shares of common stock, par value $0.01 per share. There were ~~79.7~~80.9 million shares of common stock issued and outstanding at September 30, ~~2021.~~2022.

Common ~~shares~~stock issued and outstanding


		Nine months ended September 30,			Nine months ended September 30,
(in millions)	(in millions)	2021	2020	(in millions)	2022	2021
Beginning common stock issued and outstanding	Beginning common stock issued and outstanding	75.4	74.5	Beginning common stock issued and outstanding	80.0	75.4
Common stock issued upon exercise of options, vesting of restricted stock units, and purchases under employee stock purchase plan	Common stock issued upon exercise of options, vesting of restricted stock units, and purchases under employee stock purchase plan	4.3	0.7	Common stock issued upon exercise of options, vesting of restricted stock units, and purchases under employee stock purchase plan	0.9	4.3

Common stock issued and outstanding at end of period	Common stock issued and outstanding at end of period	79.7	75.2	Common stock issued and outstanding at end of period	80.9	79.7

Basic earnings per share is computed based on the weighted-average number of shares of common stock outstanding. Diluted earnings per share is computed based on the weighted-average number of shares of common stock, including the dilutive effect of common stock equivalents, outstanding. In periods when the Company has a net loss, stock awards are excluded from the calculation of diluted net loss per share as their inclusion would have an antidilutive effect.

The following is a reconciliation of the denominators of the basic and diluted earnings per share (“EPS”) computations:

Three months ended
September 30, Nine months ended
September 30,
(in millions) 2021 2020 2021 2020
Denominator:
Weighted-average shares outstanding used to compute basic EPS 78.8 74.7 77.3 74.6
Effect of dilutive shares 2.7 — — —
Weighted-average shares outstanding and dilutive securities used to compute diluted EPS 81.5 74.7 77.3 74.6

~~Table of Contents~~


	Three months ended September 30,		Nine months ended September 30,
(in millions)	2022	2021	2022	2021
Denominator:
Weighted-average shares outstanding used to compute basic EPS	80.7	78.8	80.4	77.3
Effect of dilutive shares	—	2.7	—	—
Weighted-average shares outstanding and dilutive securities used to compute diluted EPS	80.7	81.5	80.4	77.3

Certain outstanding options and restricted stock units (“RSUs”) were excluded from the computation of diluted earnings per share because the effect would have been anti-dilutive. These potential dilutive shares of common ~~shares,~~stock, which may be dilutive to future diluted earnings per share, are as follows:


		Three months ended September 30,		Nine months ended September 30,			Three months ended September 30,		Nine months ended September 30,
(in millions)	(in millions)	2021	2020	2021	2020	(in millions)	2022	2021	2022	2021
Anti-dilutive options and RSUs excluded from EPS computation	Anti-dilutive options and RSUs excluded from EPS computation	0.1	7.3	4.9	7.3	Anti-dilutive options and RSUs excluded from EPS computation	4.5	0.1	4.5	4.9

Stock Repurchase Program

In June 2016, the Company’s Board of Directors authorized a share repurchase program of $200.0 million of the Company’s outstanding common stock. The Company may repurchase its common stock from time to time or on an accelerated basis through open market transactions or privately negotiated transactions as determined by the Company's management. The amount and timing of stock repurchases under the program will depend on business and market conditions, stock price, trading restrictions, acquisition activity and other factors. As of September 30, ~~2021,~~2022, the Company ~~is authorized to repurchase up to~~has $110.7 million ~~of shares~~remaining under ~~this~~its current share repurchase authorization. No shares were repurchased during the nine months ended September 30, ~~2021~~2022 or ~~2020.~~2021.

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11.STOCK-BASED COMPENSATION

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, to make grants of restricted and unrestricted stock awards to employees, consultants, and directors. Stockholders have approved amendments to the 2017 Plan increasing the shares available to grant. As of September 30, ~~2021,~~2022, the Company has ~~3.6~~2.0 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. To the extent that awards outstanding under the Company's prior equity plans expire or are cancelled without delivery of shares of common stock, they also will 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 a committee thereof on an award-by-award basis. RSUs granted to employees generally vest ratably over four years or 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 performance-based RSUs ("PSUs") awarded to certain employees may be increased or may be reduced based on certain additional performance and market metrics. Options and RSUs granted to non-employee directors vest in full upon the earlier of the completion of one year of service ~~on the anniversary~~ following the date of the ~~grant. Options generally vest ratably over service periods of four years. Options granted after December 5, 2012 expire eight years from~~grant or the date of ~~grant, and options~~the next annual meeting of stockholders following such grant. Options granted ~~prior to that date~~ generally expire ten years from the date of grant. Options granted to the Company's President and Chief Executive Officer as an inducement to his employment expire seven years from the grant date.

The performance and market conditions associated with PSU awards granted during the nine months ended September 30, 2022 include vesting that is based on revenue growth 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 PSUs is January 1, 2022 through December 31, 2024. The Company estimates the likelihood of achievement of performance conditions at the end of each period. The portion of the awards pertaining to relative total stockholder return represent market based awards and, accordingly, the estimated fair value of such awards are recognized over the performance period. We have also assessed that as of September 30, 2022 the performance conditions for the remaining two performance targets (revenue growth and adjusted earnings per share) are considered probable of being achieved and, accordingly, these portions of the awards are also being expensed over the performance period.

Stock Options

A summary of the stock option activity under the Company’s equity plans and inducement awards for the nine months ended September 30, ~~2021~~2022 is as follows:

(number of shares in millions) Number
of
Shares Weighted
Average
Exercise
Price
Options outstanding at December 31, 2020 5.2 $ 23.24
Options granted — $ —
Less:
Options exercised (3.6) $ 24.26
Options canceled or expired (0.1) $ 25.03
Options outstanding at September 30, 2021 1.5 $ 20.57
Options exercisable at September 30, 2021 1.1 $ 23.20

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(number of shares in millions)	Number of Shares	Weighted Average Exercise Price
Options outstanding at December 31, 2021	1.4	$	20.36

Less:
Options exercised	—	$	26.22
Options canceled or expired	(0.6)	$	26.85
Options outstanding at September 30, 2022	0.8	$	15.62
Options exercisable at September 30, 2022	0.5	$	16.99

As of September 30, ~~2021,~~2022, there was ~~$2.6~~$1.4 million of total unrecognized stock-based compensation expense related to stock options that will be recognized over a weighted-average period of ~~2.3~~1.2 years. There were no options granted during the nine months ended September 30, 2022.

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Restricted Stock Units

A summary of the RSU awards activity under the Company’s equity plans and inducement awards, including ~~RSU~~PSU awards, ~~with performance metrics,~~ for the nine months ended September 30, ~~2021~~2022 is as follows:


(number of shares in millions)	(number of shares in millions)	Number of Shares	Weighted Average Grant Date Fair Value		(number of shares in millions)	Number of Shares	Weighted Average Grant Date Fair Value
RSUs outstanding at December 31, 2020		3.2	$	20.56
RSUs outstanding at December 31, 2021					RSUs outstanding at December 31, 2021	3.1	$	24.96
RSUs granted	RSUs granted	1.7	$	29.95	RSUs granted	1.9	$	26.09
Less:	Less:				Less:
RSUs vested	RSUs vested	(0.8)	$	24.00	RSUs vested	(1.0)	$	27.27
RSUs canceled	RSUs canceled	(0.7)	$	24.63	RSUs canceled	(0.3)	$	26.57
RSUs outstanding at September 30, 2021		3.4	$	23.91
RSUs outstanding at September 30, 2022					RSUs outstanding at September 30, 2022	3.7	$	24.75

As of September 30, ~~2021,~~2022, there was ~~$68.2~~$70.8 million of total unrecognized stock-based compensation expense related to RSUs that will be recognized over a weighted-average period of ~~2.6~~2.4 years.

Employee Stock Purchase Plan

The Company also has an Employee Stock Purchase Plan that was approved by stockholders in 2012, ~~(the “2012 Purchase Plan”),~~ under which 2.0 million shares of common stock ~~have been~~were originally authorized. On September 23, 2021, the Board of Directors of the Company approved an ~~amended~~Amended and ~~restated~~Restated 2012 Employee Stock Purchase Plan (the "Amended and Restated Purchase Plan"), which ~~authorizes~~authorized an additional 2.0 million shares of common stock and ~~extends~~extended the term of the ~~2012 Purchase Plan~~plan to November 30, 2032, subject in each case to obtaining stockholder approval. The ~~amended~~Company's stockholders subsequently approved the Amended and ~~restated 2012 Employee Stock~~Restated Purchase Plan on June 2, 2022. The Amended and Restated Purchase Plan also ~~amended certain provisions of the 2012 Purchase Plan effective upon approval by the Board of Directors, including expanding~~expanded the definition of "offering period" to provide that the Board of Directors may determine the period in accordance with the terms of the plan, and ~~capping~~capped the number of shares that may be purchased by any participant during an offering period at 5,000 shares. Shares are issued under the ~~2012~~Amended and Restated Purchase Plan twice yearly at the end of each offering period. As of September 30, ~~2021, approximately 0.1~~2022, 1.8 million shares of common stock ~~are~~were available for issuance under the ~~2012~~Amended and Restated Purchase Plan.

Stock-Based Compensation Expense

Stock-based compensation expense recognized and included in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) was allocated as follows:


		Three months ended September 30,				Nine months ended September 30,					Three months ended September 30,				Nine months ended September 30,
(in millions)	(in millions)	2021		2020		2021		2020		(in millions)	2022		2021		2022		2021
Cost of molecular diagnostic testing	Cost of molecular diagnostic testing	$	0.4	$	0.3	$	1.1	$	1.0	Cost of molecular diagnostic testing	$	0.5	$	0.4	$	1.3	$	1.1
Cost of pharmaceutical and clinical services	Cost of pharmaceutical and clinical services	—		0.1		0.1		0.3		Cost of pharmaceutical and clinical services	—		—		—		0.1
Research and development expense	Research and development expense	0.8		1.3		3.3		3.6		Research and development expense	1.0		0.8		4.4		3.3
Selling, general, and administrative expense	Selling, general, and administrative expense	8.8		6.7		23.4		12.9		Selling, general, and administrative expense	7.9		8.8		24.2		23.4
Total stock-based compensation expense	Total stock-based compensation expense	$	10.0	$	8.4	$	27.9	$	17.8	Total stock-based compensation expense	$	9.4	$	10.0	$	29.9	$	27.9

12.INCOME TAXES

In order to determine the Company’s quarterly provision for income taxes, the Company used an estimated annual effective tax rate that is based on expected annual income and statutory tax rates in the various jurisdictions in which the Company operates. Certain significant or unusual items are separately recognized in the quarter during which they occur and can be a source of variability in the effective tax rate from quarter to quarter.

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Income tax ~~expense~~benefit for the three months ended September 30, ~~2021~~2022 was $9.1 million, or approximately 20.6% of pre-tax loss compared to an income tax expense of $15.2 million, or approximately 38.2% ~~of pre-tax income compared to an income tax benefit of $28.5 million, or approximately 65.2%~~ of pre-tax loss, for the three months ended September 30, ~~2020.~~2021. Income tax ~~expense~~benefit for the nine months ended September 30, ~~2021~~2022 was ~~$6.0~~$18.8 million, or approximately ~~(44.1)%~~21.2% of pre-tax loss compared to an income tax ~~benefit~~expense of ~~$47.4~~$6.0 million, or approximately ~~20.3%~~(44.1)% of pre-tax loss, for the nine months ended September 30, 2020. Income tax expense for the three and nine months ended September 30, 2021 is based on the Company’s estimated annualized effective tax rate for the fiscal year ending December 31, 2021, adjusted for discrete items recognized during the respective periods.2021. For the three and nine months ended September 30, ~~2021,~~2022, the Company’s ~~recognized~~ effective tax rate differs from the U.S. federal statutory rate primarily due to disallowed executive compensation, ~~expenses, disallowed meals and entertainment expenses,~~ stock compensation, ~~expenses, benefit recorded as a result of~~uncertain tax positions and asset impairments. For the ~~CARES Act,~~three and nine months ended September 30, 2021, the Company’s effective tax rate differs from the U.S. federal statutory rate primarily due to disallowed executive compensation, stock compensation, carrying back net operating losses, asset ~~impairment expenses,~~impairments, release of a valuation allowance, and differences between the book and tax basis of assets divested. In connection with the sale of Crescendo Biosciences, the Company recognized a change in the valuation allowance related to the change of the corresponding tax attributes, with no impact on the Company's income tax expense in the quarter ended September 30, 2022.

The Company files U.S., foreign and state income tax returns in jurisdictions with various statutes of limitations. The Company is currently under audit by the State of California for the fiscal years ended June 30, 2017-2018, the State of New Jersey for the fiscal years ended June 30, 2013-2017; ~~Germany for the fiscal years ended June 30, 2013-2015;~~ and Switzerland for the fiscal years ended June 30, 2015-2016. Annual and interim 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.

13.COMMITMENTS AND CONTINGENCIES

Legal Proceedings

The Company is ~~subject~~involved from time to time in various disputes, claims and legal ~~proceedings covering~~actions, including class actions and other litigation, including the matters ~~that arise~~described below, arising in the ordinary course of ~~its~~business. Such actions may include allegations of negligence, product or professional liability or other legal claims, and could involve claims for substantial compensatory and punitive damages or claims for indeterminate amount of damages. The Company is also involved, from time to time, in investigations by governmental agencies regarding the Company's business ~~activities,~~which may result in adverse judgments, settlements, fines, penalties, injunctions or other relief. In addition, certain federal and state statutes, including the qui tam provisions of the federal False Claims Act, allow private individuals to bring lawsuits against healthcare companies on behalf of the government or private payors. The Company is involved, and has received subpoenas, from time to time, related to billing or other practices based on the False Claims Act or other federal and state statutes, regulations or other laws.

The Company intends to vigorously defend its current litigation matters, ~~described below. Estimates~~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 ~~resolution~~potential accrual 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 September 30, 2022, the Company has not recorded any accrual for loss contingencies associated with legal proceedings or other ~~contingencies are accrued when losses are~~matters or determined that an unfavorable outcome is probable and reasonably estimable in accordance with ASC 450, ~~Contingencies~~Contingencies. .

~~Qui Tam Lawsuit~~

In June 2016, the Company's wholly owned subsidiary, Crescendo Bioscience, Inc. (“CBI”), received a subpoena from the Office of Inspector General of the Department of Health and Human Services requestingHowever, it is possible that CBI produce documents relating to entities that received payment from CBI for the collection and processing of blood specimens for testing, including a named unrelated company, healthcare providers and other third party entities. The Office of Inspector General subsequently requested additional documentation in December 2017. CBI provided to the Office of Inspector General the documents requested. On January 30, 2020, the United States District Court for the Northern District of California unsealed a qui tam complaint, filed on April 16, 2016 against CBI and the Company, alleging violations of the Federal and California False Claims Acts and the California Insurance Fraud Prevention Act. On January 22, 2020, after a multi-year investigation into CBI’s and the Company’s alleged conduct, the United States declined to intervene. On January 27, 2020, the State of California likewise filed its notice of declination. The Company was not aware of the complaint until after it was unsealed. On May 23, 2020, the court denied CBI and the Company’s motion to dismiss. The Company has accrued $48.0 million for a potential settlement of this qui tam lawsuit against CBI and the Company, which is included in accrued liabilities in the Company's Condensed Consolidated Balance Sheet. If no settlement is reached, the Company intends to continue to vigorously defend this case, but it cannot predict with any degree of certainty the ultimate resolution of ~~this matter~~legal proceedings or ~~determine whether,~~other matters, if unfavorable, may be material to the Company's results of operations, financial condition or ~~to what extent, any loss with respect to this matter may~~cash flows. Further, in the event that damages from an unfavorable resolution of one or more of these proceedings exceed the aggregate amount ~~that it has accrued.~~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.

~~Purported~~

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Securities Class Action

On September 27, 2019, a ~~purported~~ class action complaint was filed in the United States 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”~~(the “Defendants”). On February 21, 2020, the plaintiff filed an amended class action complaint, which added the ~~Company’s~~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 seeks the payment of damages allegedly sustained by it and the purported 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 United States District Court for the District of Utah denied the ~~Company’s~~Company's motion to dismiss. On December 1, 2021, the United States District Court for the District of Utah granted plaintiff's motion for class certification. The Company intends to vigorously defend against this action. Due to the nature of this matter and inherent uncertainties, it is not possible to provide an evaluation of the likelihood of an unfavorable outcome or an estimate of the amount or range of potential loss, if any.parties currently are engaged in discovery.

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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 its current and former directors, Lawrence C. Best, Walter Gilbert, John T. Henderson, Heiner Dreismann, Dennis Langer, Lee N. Newcomer, S. 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, ~~intends~~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 ~~vigorously defend against~~ this action. ~~Due to~~

On March 3, 2022, the ~~nature~~Delaware Court of ~~this matter~~Chancery consolidated the Hickock and ~~inherent uncertainties, it is not possible to provide an evaluation of~~Kogus derivative actions and stayed the ~~likelihood of an unfavorable outcome or an estimate of the amount or range of potential loss, if any.~~consolidated action.

On September 17, 2021, a ~~second~~ stockholder derivative complaint was filed in the United States District Court ~~for~~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 United States District Court for the District of Delaware pending the resolution of the securities class action lawsuit.

Other Legal Matters

On December 21, 2020, Ravgen, Inc. filed a lawsuit against the Company and its wholly owned subsidiary, Myriad Women's Health, Inc., in the United States District Court for the District of Delaware, alleging infringement of two Ravgen-owned patents. The ~~Company intends to vigorously defend against this action. Due~~lawsuit seeks 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 ~~nature of this matter and inherent uncertainties, it is not possible to provide an evaluation~~validity of the ~~likelihood of an unfavorable~~asserted patents with the United States Patent and Trademark Office, which challenges have been instituted for review. On March 14, 2022, the case was stayed pending the outcome ~~or an estimate~~ of the ~~amount or range~~first of ~~potential loss, if any.~~these validity challenges.

~~Other Matters~~

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On ~~July 27, 2020,~~February 3, 2022, a purported class action lawsuit was filed against the Company in the ~~Superior~~United States District Court in the Northern District of ~~Suffolk County, Massachusetts,~~California by ~~Heide Abelli and Victor Pricolo. The plaintiffs claim negligence, breach of contract and associated torts in connection with an alleged error in testing performed by~~Ashley Carroll. Plaintiff alleges, among other things, that the Company made false statements about the accuracy of its Prequel prenatal screening test. The complaint seeks unspecified monetary 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 United States District Court in ~~2004. The plaintiffs seek damages allegedly sustained by them by reason~~the Northern District of California granted and denied in part the Company's motion to dismiss the amended complaint. As part of the ~~allegations set forth in their~~court's order, plaintiff was granted leave to file a second amended complaint. The plaintiff filed a second amended complaint together with interest and costs. The Company intends to vigorously defend against this action. Due to the nature of this matter and inherent uncertainties, it is not possible to provide an evaluation of the likelihood of an unfavorable outcome or an estimate of the amount or range of potential loss, if any.

~~As of~~on August 16, 2022. On September ~~30, 2021, the management of~~6, 2022, the Company ~~believes any reasonably possible liability that may result from~~filed a motion to dismiss the resolution of any other matters will not have a material adverse effect on the Company’s consolidated financial position, operating results, or cash flows. However, it is possible that the ultimate resolution of other matters, if unfavorable, may be material to the results of operations or financial condition for a particular period.second amended complaint.

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.

14.~~SEGMENT AND RELATED INFORMATION~~

The Company’s business is aligned with how the chief operating decision maker reviews performance and makes decisions in managing the Company. The business units have been aggregated into 2 reportable segments: (i) diagnostics and (ii) other. The diagnostics segment provides testing and collaborative development of testing that is designed to determine the risk of developing disease, assess the risk of disease progression, and guide treatment decisions across medical specialties where critical genetic insights can significantly improve patient care and lower healthcare costs. The other segment provides testing products and services to the pharmaceutical, biotechnology and medical research industries, research and development, and clinical services for patients, and includes corporate services such as finance, human resources, legal and information technology.

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~~Segment revenue and operating income (loss) were as follows during the periods presented:~~

(in millions) Diagnostics Other Total
Three months ended September 30, 2021
Revenues $ 161.7 $ 5.6 $ 167.3
Depreciation and amortization 13.1 1.1 14.2
Segment operating loss (21.7) (58.2) (79.9)
Three months ended September 30, 2020
Revenues $ 130.5 $ 14.7 $ 145.2
Depreciation and amortization 16.7 1.0 17.7
Segment operating loss (0.3) (39.3) (39.6)
Nine months ended September 30, 2021
Revenues $ 496.6 $ 33.2 $ 529.8
Depreciation and amortization 45.8 3.7 49.5
Segment operating income (loss) 26.3 (173.7) (147.4)
Nine months ended September 30, 2020
Revenues $ 362.0 $ 40.4 $ 402.4
Depreciation and amortization 50.2 3.1 53.3
Segment operating loss (127.7) (113.9) (241.6)

Three months ended
September 30, Nine months ended
September 30,
(in millions) 2021 2020 2021 2020
Total operating loss for reportable segments $ (79.9) $ (39.6) $ (147.4) $ (241.6)
Unallocated amounts:
Interest income 0.2 0.4 0.6 1.7
Interest expense (1.1) (2.9) (6.1) (8.3)
Other 120.6 (1.6) 139.3 14.9
Income (loss) from operations before income taxes 39.8 (43.7) (13.6) (233.3)
Income tax expense (benefit) 15.2 (28.5) 6.0 (47.4)
Net income (loss) 24.6 (15.2) (19.6) (185.9)
Net loss attributable to non-controlling interest — — — (0.1)
Net income (loss) attributable to Myriad Genetics, Inc. stockholders $ 24.6 $ (15.2) $ (19.6) $ (185.8)

~~15.~~SUPPLEMENTAL CASH FLOW INFORMATION


		Nine months ended September 30,					Nine months ended September 30,
(in millions)	(in millions)	2021		2020		(in millions)	2022		2021
Cash paid during the period for income taxes	Cash paid during the period for income taxes	$	2.4	$	2.3	Cash paid during the period for income taxes	$	1.6	$	2.4
Cash paid for interest	Cash paid for interest	2.1		6.9		Cash paid for interest	—		2.1
Cash received for income tax receivables	Cash received for income tax receivables	89.9		—		Cash received for income tax receivables	—		89.9
Establishment of operating lease right-of-use assets and lease liabilities	Establishment of operating lease right-of-use assets and lease liabilities					Establishment of operating lease right-of-use assets and lease liabilities
Operating lease right-of-use assets	Operating lease right-of-use assets	$	40.5	$	—	Operating lease right-of-use assets	$	46.1	$	40.5
Operating lease liabilities	Operating lease liabilities	46.8		—		Operating lease liabilities	46.1		46.8
Tenant improvement allowance not yet received						Tenant improvement allowance not yet received	17.8		—
Purchases of property, plant and equipment in accounts payable and accrued liabilities						Purchases of property, plant and equipment in accounts payable and accrued liabilities	4.3		—

15.LEASES

The Company leases certain office spaces and research and development laboratory facilities, vehicles, and office equipment with remaining lease terms ranging from one to fifteen years. During the nine months ended September 30, 2022, in an effort to reduce its real estate footprint, the Company ceased the use of one of its leased Salt Lake City facilities. As a result, the Company recorded an impairment charge on right-of-use assets of $8.6 million and an impairment charge of $2.1 million on the related leasehold improvements. The total $10.7 million impairment is included in Goodwill and long-lived asset impairment charges in the Condensed Consolidated Statement of Operations.

In the first quarter of 2022, the Company entered into a non-cancelable operating lease for approximately 230,000 square feet in west Salt Lake City, Utah. The lease has a term of 15 years, which, along with rent payments, are expected to commence in the third quarter of 2023. The Company will take possession of the leased facility in phases, which began in the three months ended June 30, 2022. As a result, the Company has recognized the related lease balances for the phase, or portion, of the leased facility that the Company has taken possession of, and will recognize the additional phases of the leased facility as possession occurs. As of September 30, 2022, the Company has recognized an approximately $13.9 million right-of-use asset and corresponding lease liability, net of tenant improvement allowance not yet received. Total future rent payments under the lease are approximately $77.8 million.

During the three months ended September 30, 2022, the Company took possession of a lease for approximately 63,000 square feet in South San Francisco, California with a term of 10 years, which, along with rent payments, are expected to commence in the third quarter of 2023. As a result, the Company recognized the related right-of-use asset and lease liability, net of tenant improvement allowance not yet received, of $30.7 million in the Condensed Consolidated Balance Sheet as of September 30, 2022. Total future rent payments under the lease are approximately $58.8 million.

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16.DIVESTITURES

On May 28, 2021, the Company completed its sale of the Myriad myPath, LLC laboratory to Castle Biosciences, Inc. for total cash consideration of $32.5 million. The transaction was accounted for as a sale of assets and the Company recognized a net gain of $31.2 million ~~net of transaction costs of $1.3 million,~~in the quarter ended June 30, 2021, in Other income ~~(expense)~~ on the Company’s Condensed Consolidated Statements of Operations related to the sale. Prior to the sale, Myriad myPath operations were included in the Company’s diagnostics reporting segment.

On ~~July~~May 1, 2021, the Company ~~completed its~~entered into a definitive agreement to sell select operating assets and intellectual property, including the Vectra® test, from the Myriad Autoimmune business unit (the "Autoimmune Business Transaction") to Laboratory Corporation of America Holdings for total cash consideration of $150.0 million. The Autoimmune Business Transaction closed on September 13, 2021. The transaction was accounted for as a sale of a business and the Company recognized a loss of $0.6 million in the quarter ended September 30, 2021, in Other income on the Company's Condensed Consolidated Statements of Operations related to the sale. Prior to the sale, Myriad Autoimmune operations were included in the Company’s diagnostics reporting segment.

On May 21, 2021, the Company entered into a definitive agreement to sell Myriad RBM, Inc., a wholly owned subsidiary of the Company, to IQVIA RDS, Inc. for cash consideration of $197.0 million. This transaction closed on July 1, 2021. 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 the quarter ended September 30, 2021, in Other income ~~(expense)~~ on the Company's Condensed Consolidated Statements of ~~Operations.~~Operations related to the sale. Prior to the sale, Myriad RBM, Inc. operations were included in the Company’s other reporting segment.

On September 13, 2021, the Company completed its 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) on the Company's Condensed Consolidated Statements of Operations. Prior to the sale, the Myriad Autoimmune business operations were included in the Company’s diagnostics reporting segment.

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

Inventory

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 nine months ended September 30, 2021, as the Company ~~will~~would no longer have use for the goods. Both of these losses are included in Other income (expense) in the Company's Condensed Consolidated Statements of Operations for the nine months ended September 30, 2021.

The following table details the amounts recognized in Other income for the three and nine months ended September 30, 2021:


(in millions)	(in millions)	Three months ended September 30, 2021		Nine months ended September 30, 2021		(in millions)	Three months ended September 30, 2021		Nine months ended September 30, 2021
Gain on sale of Myriad RBM, Inc.	Gain on sale of Myriad RBM, Inc.	$	121.0	$	121.0	Gain on sale of Myriad RBM, Inc.	$	121.0	$	121.0
Gain on sale of Myriad myPath, LLC laboratory	Gain on sale of Myriad myPath, LLC laboratory	—		31.2		Gain on sale of Myriad myPath, LLC laboratory	—		31.2
Gain (loss) on inventory	Gain (loss) on inventory	0.8		(11.7)		Gain (loss) on inventory	0.8		(11.7)
Loss on sale of Myriad Autoimmune assets	Loss on sale of Myriad Autoimmune assets	(0.6)		(0.6)		Loss on sale of Myriad Autoimmune assets	(0.6)		(0.6)
Other	Other	(0.6)		(0.6)		Other	(0.6)		(0.6)
Total Other Income		$	120.6	$	139.3
Total other income						Total other income	$	120.6	$	139.3

17.SUBSEQUENT EVENTS

~~The Company evaluated subsequent events from the balance sheet date through the date the financial statements were issued. Based upon this review,~~

On November 1, 2022, the Company ~~did not identify any subsequent events~~acquired Gateway Genomics, LLC ("Gateway"), a personal genomics company and developer of consumer genetic tests that ~~would have required adjustment or disclosure~~gives families insight into their future children, for an upfront cash purchase price of $67.5 million, subject to customary adjustments, and up to $32.5 million in contingent cash consideration upon the ~~financial statements.~~achievement of certain performance-based targets. The acquisition was consummated pursuant to an Agreement and Plan of Merger, dated November 1, 2022, among the Company, Genos Merger Sub LLC, a wholly owned subsidiary of the Company ("Merger Sub"), Gateway, the equity holders of Gateway, and Shareholder Representative Services LLC, in its capacity as the equity holders' representative, whereby Merger Sub merged with and into Gateway, with Gateway surviving the merger as the surviving company and a wholly owned subsidiary of Myriad.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Dollars and shares in millions, except per share data)

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the unaudited Condensed Consolidated Financial Statements and the related notes thereto included in this Quarterly Report on Form 10-Q and the audited Consolidated Financial Statements and notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations for the ~~transition period~~year ended December 31, ~~2020~~2021 included in our ~~Transition~~Annual Report on Form 10-K filed with the SEC on ~~March 16, 2021.~~February 25, 2022. “We,” “us,” “our,” “Myriad” and the “Company” as used in this Quarterly Report on Form 10‑Q refer to Myriad Genetics, Inc., a Delaware corporation, and its subsidiaries.

Cautionary Statement Regarding Forward-Looking Statements

The SEC encourages companies to disclose forward-looking information so that investors can better understand a company’s future prospects and make informed investment decisions. This Quarterly Report on Form 10‑Q contains such “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.

Words such as “may,” “anticipate,” “estimate,” “expects,” “projects,” “intends,” “plans,” “believes,” “seek,” “could,” “continue,” “likely,” “will,” “strategy” and “goal” and words and terms of similar substance used in connection with any discussion of future operating or financial performance identify forward-looking statements. All forward-looking statements are management’s present expectations of future events and are subject to a number of known and unknown risks and uncertainties that could cause actual results, conditions, and events to differ materially and adversely from those ~~described in the forward-looking statements.~~anticipated. These risks include, but are not limited to:

•~~uncertainties associated with COVID-19, including its possible effects on our operations and the demand for our products and services;~~

•~~risks related to our ability to efficiently and flexibly manage our business amid uncertainties associated with COVID-19;~~

•the risk that sales and profit margins of our existing molecular diagnostic tests may decline or that we may not be able to operate our business on a profitable basis;

•risks related to our ability to generate sufficient revenue from our existing product portfolio or in launching and commercializing new tests;

•risks related to changes in governmental or private insurers’ coverage and reimbursement levels for our tests or our ability to obtain reimbursement for our new tests at comparable levels to our existing tests;

•risks related to increased competition and the development of new competing tests and services;

•uncertainties associated with COVID-19, including its possible effects on our operations and the demand for our products and services and on our ability to efficiently and flexibly manage our business;

•the risk that we may be unable to develop or achieve commercial success for additional molecular diagnostic tests in a timely manner, or at all;

•the risk that we may not successfully develop new markets for our molecular diagnostic tests, including our ability to successfully generate revenue outside the United States;

•the risk that licenses to the technology underlying our molecular diagnostic tests and any future tests are terminated or cannot be maintained on satisfactory terms;

•risks related to delays or other problems with operating and constructing our laboratory testing facilities;

•risks related to public concern over genetic testing in general or our tests in particular;

•risks related to regulatory requirements or enforcement in the United States and foreign countries and changes in the structure of the healthcare system or healthcare payment systems;

•risks related to our ability to obtain new corporate collaborations or licenses and acquire or develop new technologies or businesses on satisfactory terms, if at all;

•risks related to our ability to successfully integrate and derive benefits from any technologies or businesses that we license, acquire, or ~~acquire;~~develop;

•risks related to our projections about the potential market opportunity for our current and future products;

•the risk that we or our licensors may be unable to protect or that third parties will infringe the proprietary technologies underlying our tests;

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•the risk of patent-infringement claims or challenges to the validity of our patents;

•risks related to changes in intellectual property laws covering our molecular diagnostic tests, or patents or enforcement, in the United States and foreign countries;

•risks related to security breaches, loss of data and other disruptions, including from cyberattacks;

•risks of new, changing and competitive technologies and regulations in the United States and internationally;

•the risk that we may be unable to comply with financial operating covenants under our credit or lending agreements; ~~and~~

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•risks related to the material weakness related to our ~~quarterly income tax provision process,~~general information technology controls, including the impact thereof and our remediation ~~plan.~~plan, and our inability to achieve and maintain effective disclosure controls and procedures and internal control over financial reporting;

•risks related to current and future investigations, claims or lawsuits, including product or professional liability claims, and risks related to the amount of our insurance coverage limits and scope of insurance coverage with respect thereto; and

•other factors discussed under the heading "Risk Factors" contained in Item 1A of our Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission on February 25, 2022.

In light of these assumptions, risks and uncertainties, the results and events discussed in the forward-looking statements contained in this Quarterly Report, or in any document incorporated by reference might not occur. Stockholders are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this Quarterly Report. We are not under any obligation, and we expressly disclaim any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or ~~otherwise.~~otherwise except as required by law. All forward-looking statements in this Quarterly Report attributable to us or to any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section.

General

We ~~discover~~are a leading genetic testing and ~~commercialize~~precision medicine company dedicated to advancing health and well-being for all. We provide insights that help people take control of their health and enable healthcare providers to better detect, treat, and prevent disease. We develop and offer genetic tests that ~~determine~~help assess the risk of developing disease ~~assess the risk of~~or disease progression ~~and~~or guide treatment decisions across medical specialties where critical genetic insights can significantly improve patient care and lower ~~healthcare~~health care costs. ~~Since our founding in 1992, we have performed tests for approximately five million patients. Our mission~~

Personalized genetic data and ~~purpose is~~digital and virtual consumer trends are converging to ~~advance~~change traditional models of care. Significant growth opportunities exist to help patient populations with pressing health care needs through innovative solutions and ~~well-being for all, empower individuals with vital genetic insights and enable healthcare providers to better detect, treat and prevent disease.~~

services. We are currently ~~developing and~~ executing ~~upon~~ a strategic transformation and growth plan that ~~is focused~~aims to capitalize on ~~the following~~those trends by focusing on three strategic priorities: (1) ~~put patients~~innovation that improves clinical outcomes, ease of use, and ~~customers first;~~access; (2) ~~build new tech-enabled commercial capabilities;~~enterprise capabilities to accelerate growth and scale to market opportunity; and (3) ~~elevate core products to their full potential;~~a focus on execution and ~~(4) create new avenues for growth.~~delivery of consistent results. In connection with these strategic priorities, we are focusing our efforts ~~on our Hereditary Cancer, Tumor Profiling, Prenatal~~in three key areas where we have specialized products, capabilities, and ~~Pharmacogenomics products~~expertise: Oncology, Women's Health, and ~~as described below, have divested certain non-core assets and businesses. We~~Mental Health. In each of these areas, we intend to ~~execute on our transformation plan by prioritizing product innovation, research~~develop and ~~technology initiatives, strategic collaborations~~enhance best-in-class products to support growth, improve patient and ~~investments,~~provider experience, and ~~defining and deploying a customer-centric technology-enabled~~reach more patients of all backgrounds. By investing in tech-enabled commercial ~~model. We~~tools, we believe ~~that by focusing on these strategic priorities,~~ we will be able to drive increased engagement, improve revenue cycle management, and reduce complexity and ~~cost, improve~~cost. We are committed to disciplined management of a key set of initiatives to fulfill our mission and drive long-term growth and profitability. With a foundation of financial, ~~performance, build a more effective~~commercial, operational and ~~cost-efficient sales model, and enhance our reimbursement and revenue cycle capabilities. In addition,~~technological strength, we ~~believe we can~~expect to accelerate growth as we launch a new enterprise commercial model, launch a unified ordering portal, invest in ~~innovation, research and partnerships,~~new sequencing technologies, further develop ~~capabilities to support our sales team with new digital tools and add more~~ direct-to-consumer ~~engagement,~~channels, and build commercial capabilities to support new products and ~~acquisitions.~~offerings.

Business Updates

During the quarter ended September 30, ~~2021,~~2022, we continued to ~~see improvement in business fundamentals for~~take meaningful steps to expand access to our ~~diagnostic~~ products ~~which have been affected by the COVID-19 pandemic.~~and execute upon our transformation plan. We ~~have~~ also made the following recent announcements:

•On ~~September 13, 2021,~~November 1, 2022, we ~~completed~~announced the ~~sale~~acquisition of ~~select operating assets~~Gateway Genomics, LLC, a personal genomics company and ~~intellectual property, including the Vectra® test, from the Myriad Autoimmune business unit (the "Autoimmune Business Transaction") to Laboratory Corporation~~developer of ~~America Holdings for cash consideration of $150.0 million.~~consumer genetic tests that gives families insight into their future children.

•On October 31, 2022, we announced the election of Paul Bisaro to the Company's Board of Directors, effectively immediately.

•On July ~~1, 2021,~~12, 2022, we ~~completed~~announced that the ~~sale of Myriad RBM, Inc., a wholly owned subsidiary~~Journal of the ~~Company,~~American Medical Association published study results that concluded Major Depressive Disorder remission rates were significantly improved when clinicians had access to ~~IQVIA RDS,~~GeneSight® Psychotropic test results from Myriad Genetics, Inc. ~~for cash consideration of $197.0 million.~~

•On August ~~2, 2021, we launched a new version of the myRisk Hereditary Cancer Test which allows women of all ancestries to receive a personalized polygenic breast cancer risk assessment for the first time.~~

•~~On October 18, 2021,~~16, 2022, we announced two partnerships with the ~~appointment of Pamela Wong as Chief Legal Officer of~~Institut für Hämopathologie Hamburg (HPH) in Hamburg, Germany and the ~~Company.~~Centre Georges-Francois LeClerc (CGFL) in Dijon, France to expand access to MyChoice

CDx Plus testing.

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•On August 25, 2022, we announced expanded coverage in Japan for the use of Myriad's BRACAnalysis® Diagnostic System as a companion diagnostic to identify patients with germline BRCA-mutated (gBRCAm) and HER2-negative high-risk recurrent breast cancer who may benefit from Lynparza®(olaparib).

•On August 31, 2022, we announced that Clinical Cancer Research, a journal of the American Association for Cancer Research, published a study that shows the EndoPredict® breast cancer prognostic test significantly predicted distant recurrence in premenopausal women with ER+, HER2- early-stage breast cancer. This newly published study represented the first clinical validation of EndoPredict in a solely premenopausal population.

•Molecular Diagnostic Services Program (MolDX®) assigned the MyRisk® hereditary cancer test Current Procedural Terminology (CPT) code 81479. The Centers for Medicare & Medicaid Services (CMS) preliminarily determined to crosswalk GeneSight to Proprietary Laboratory Analyses (PLA) code 0175U.

Results of Operations for the Three Months Ended September 30, ~~2021~~2022 and ~~2020~~2021

The results of operations for the three months ended September 30, ~~2021~~2022 and ~~2020~~2021 are discussed below. ~~See Note 14 “Segment and Related Information” in the notes to our Condensed Consolidated Financial Statements for information regarding our operating segments.~~

Revenue


		Three months ended September 30,				Change		% of total revenue			Three months ended September 30,				Change		% of total revenue
(in millions)	(in millions)	2021		2020		2021		2021	2020	(in millions)	2022		2021		2022		2022	2021
Molecular diagnostic revenues:	Molecular diagnostic revenues:									Molecular diagnostic revenues:
Hereditary Cancer	Hereditary Cancer	$	79.4	$	80.5	$	(1.1)	47%	55%	Hereditary Cancer	$	70.5	$	79.4	$	(8.9)	45%	47%
Tumor Profiling	Tumor Profiling	32.9		17.0		15.9		20%	12%	Tumor Profiling	30.8		32.9		(2.1)		20%	20%
Prenatal	Prenatal	23.6		16.6		7.0		14%	11%	Prenatal	22.1		23.6		(1.5)		14%	14%
Pharmacogenomics	Pharmacogenomics	24.1		11.9		12.2		14%	8%	Pharmacogenomics	33.0		24.1		8.9		21%	14%
Autoimmune	Autoimmune	7.3		9.1		(1.8)		4%	6%	Autoimmune	—		7.3		(7.3)		—%	4%
Other		—		0.6		(0.6)		—%	—%
Total molecular diagnostic revenue	Total molecular diagnostic revenue	167.3		135.7		31.6				Total molecular diagnostic revenue	156.4		167.3		(10.9)
Pharmaceutical and clinical services revenue		—		9.5		(9.5)		—%	7%
Total revenue	Total revenue	$	167.3	$	145.2	$	22.1	100%	100%	Total revenue	$	156.4	$	167.3	$	(10.9)	100%	100%

Molecular diagnostic revenues ~~increased $31.6~~decreased $10.9 million for the three months ended September 30, ~~2021~~2022 compared to the same period in the prior year. ~~Tumor profiling~~Hereditary Cancer revenues ~~increased $15.9~~decreased $8.9 million compared to the same period in the prior year due to ~~an $8.3~~a 15% decrease in average reimbursement per test, driven by change in the estimated reimbursement per test, changes in foreign exchange rates, and a change in customer mix. Autoimmune revenues decreased $7.3 million ~~increase~~due to the sale of the Myriad Autoimmune business on September 13, 2021. Tumor profiling revenues decreased $2.1 million compared to the same period in ~~revenue from myChoice CDx internationally, including a $4.0 million~~the prior year due primarily to one-time milestone ~~payment, and a $6.4 million increase~~revenue earned in ~~revenue for Prolaris due to expanded coverage.~~the three months ended September 30, 2021. Prenatal revenues ~~increased $7.0~~decreased $1.5 million compared to the same period in the prior year due primarily to a ~~change~~decrease in ~~estimate for prior period revenues, a 13% increase in average~~the estimated reimbursement per ~~test, and a 7% increase in volumes.~~test. Revenues from Pharmacogenomics increased ~~$12.2~~$8.9 million compared to the same period in the prior year due primarily to a ~~71%~~34% increase in volume. Hereditary Cancer revenues decreased $1.1 million compared to the same period in the prior year due to a slight decrease in reimbursement per test as the market for hereditary cancer products continues to become commoditized, which decrease was partially offset by a slight increase in volume. Autoimmune revenues decreased $1.8 million primarily due to the completion of the Autoimmune Business Transaction on September 13, 2021.

Pharmaceutical and clinical services revenues decreased for the three months ended September 30, 2021 compared to the same period in the prior year due to the sale of Myriad RBM, Inc. on July 1, 2021. As a result of the sale, there were no Pharmaceutical and clinical services revenues during the current period. Myriad RBM, Inc. generated $9.3 million in revenues during the prior period.

Cost of Sales


		Three months ended September 30,									Three months ended September 30,
(in millions)	(in millions)	2021			2020			Change		(in millions)	2022			2021			Change
Cost of molecular diagnostic testing	Cost of molecular diagnostic testing	$	47.8		$	39.9		$	7.9	Cost of molecular diagnostic testing	$	50.4		$	47.8		$	2.6
Cost of molecular diagnostic testing as a % of revenue	Cost of molecular diagnostic testing as a % of revenue	28.6		%	29.4		%			Cost of molecular diagnostic testing as a % of revenue	32.2		%	28.6		%
Cost of pharmaceutical and clinical services		$	—		$	4.3		$	(4.3)
Cost of pharmaceutical and clinical services as a % of revenue		—		%	45.3		%

The ~~Cost~~cost of molecular diagnostic testing as a percentage of revenue ~~decreased~~increased from ~~29.4%~~28.6% to ~~28.6%~~32.2% during the three months ended September 30, ~~2021~~2022 compared to the same period in the prior year.

The ~~Cost of pharmaceutical and clinical services as a percentage of revenue~~increase was ~~45.3%~~primarily driven by the shift in the product mix for the ~~three months ended September 30, 2020. The sale of Myriad RBM, Inc. was completed on July 1, 2021,~~current period and ~~as a result there were no corresponding~~an increase in compensation costs ~~during the current period.~~

due to higher headcount.

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Research and Development Expense


		Three months ended September 30,									Three months ended September 30,
(in millions)	(in millions)	2021			2020			Change		(in millions)	2022			2021			Change
R&D expense	R&D expense	$	18.8		$	17.6		$	1.2	R&D expense	$	20.5		$	18.8		$	1.7
R&D expense as a % of total revenue	R&D expense as a % of total revenue	11.2		%	12.1		%			R&D expense as a % of total revenue	13.1		%	11.2		%

Research and development expense for the three months ended September 30, ~~2021~~2022 increased compared to the same period in the prior year primarily due to an increase in general information technology-related costs, increases in costs incurred in the current period as part of the Company’s strategic transformation initiatives, and an increase in bonus expense due to improved performance of the Company, partially offset by a decrease in compensation related costs due to a lower headcount.

Selling, General and Administrative Expense


		Three months ended September 30,									Three months ended September 30,
(in millions)	(in millions)	2021			2020			Change		(in millions)	2022			2021			Change
Selling, general and administrative expense	Selling, general and administrative expense	$	180.2		$	124.1		$	56.1	Selling, general and administrative expense	$	130.5		$	180.6		$	(50.1)
Selling, general and administrative expense as a % of total revenue	Selling, general and administrative expense as a % of total revenue	107.7		%	85.5		%			Selling, general and administrative expense as a % of total revenue	83.4		%	107.9		%

Selling, general and administrative expense ~~increased~~decreased for the three months ended September 30, ~~2021~~2022 compared to the same period in the prior year primarily due to a $51.2 million decrease in general legal expenses, due primarily to a $48.0 million legal accrual related to the Crescendo Bioscience, ~~Inc.~~LLC qui tam lawsuit ~~as well as~~in the prior period, a ~~$2.9~~$4.2 million ~~increase~~decrease in bonus expense, and a $2.6 million decrease in costs incurred in the current period as part of the Company's strategic transformation initiatives, ~~a $2.2 million increase in stock-based compensation, a $2.1 million increase in marketing costs, a $2.1 million increase in legal expenses, and a $1.9 million increase in consulting fees,~~ partially offset by a ~~$3.7~~$3.0 million ~~decrease~~increase in ~~amortization expense~~sales and ~~a $1.7 million decrease in commission expense~~marketing expenses due to ~~a decrease in headcount from the prior period.~~

~~Change~~more in-person sales and marketing events and travel-related expenses in the ~~Fair Value of Contingent Consideration~~current period. In addition, consulting expenses, computer and hardware expenses, and general compensation expenses increased in the current period.

Three months ended September 30,
(in millions) 2021 2020 Change
Change in the fair value of contingent consideration $ 0.4 $ (1.1) $ 1.5
Change in the fair value of contingent consideration as a % of total revenue 0.2 % (0.8) %
Other Income (Expense), Net

~~The fair value of contingent consideration~~


	Three months ended September 30,
(in millions)	2022		2021		Change
Other income (expense), net	$	0.8	$	119.7	$	(118.9)

Other income (expense), net decreased for the three months ended September 30, 2021 increased compared to the same period in the prior year due to changes in timing of expected cash payments associated with the contingent consideration related to the Sividon Diagnostics GmbH acquisition in fiscal year 2016.

~~Other Income (Expense), Net~~

Three months ended September 30,
(in millions) 2021 2020 Change
Other income (expense), net $ 119.7 $ (4.1) $ 123.8

~~Other income (expense), net increased for the three months ended September 30, 2021~~2022 compared to the same period in the prior year due primarily to the $121.0 million net gain recognized on the sale of Myriad RBM, Inc. in the ~~current~~prior period, partially offset by ~~expenses in~~ the ~~current period, including a~~ $0.6 million net loss recognized on the sale of ~~the~~ Myriad Autoimmune ~~business unit. The prior year expense primarily relates to foreign exchange losses partially offset by interest income~~assets in the prior period. There were no similar items in the current period.

Income Tax Expense (Benefit)


		Three months ended September 30,									Three months ended September 30,
(in millions)	(in millions)	2021			2020			Change		(in millions)	2022			2021			Change
Income tax expense (benefit)	Income tax expense (benefit)	$	15.2		$	(28.5)		$	43.7	Income tax expense (benefit)	$	(9.1)		$	15.2		$	(24.3)
Effective tax rate	Effective tax rate	38.2		%	65.2		%			Effective tax rate	20.6		%	38.2		%

Our tax rate is the product of a blended U.S. federal effective rate of 21.0% and a blended state income tax rate of approximately ~~3.4%. Certain significant or unusual items are separately recognized during the period in which they occur and can be a source of variability in the effective tax rates from period to period.~~

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Income tax expense (benefit) for the three months ended September 30, 2021 was $15.2 million, and our effective tax rate was 38.2%. The change in the effective tax rate for the three months ended September 30, 2021 as compared to the same period in the prior year is primarily due to the tax benefit recorded in the prior year related to the CARES Act, tax expenses recorded in the current year related to the differences between the book and tax basis of assets divested, disallowed executive compensation expenses, and stock compensation expenses.

~~Results of Operations for the Nine Months Ended September 30, 2021 and 2020~~

The results of operations for the nine months ended September 30, 2021 and 2020 are discussed below. See Note 14 “Segment and Related Information” in the notes to our Condensed Consolidated Financial Statements for information regarding our operating segments.

~~Revenue~~

Nine months ended September 30, Change % of total revenue
(in millions) 2021 2020 2021 2021 2020
Molecular diagnostic revenues:
Hereditary Cancer $ 241.5 $ 205.6 $ 35.9 46% 51%
Tumor Profiling 94.4 41.2 53.2 18% 10%
Prenatal 76.7 53.5 23.2 14% 13%
Pharmacogenomics 64.3 40.8 23.5 12% 10%
Autoimmune 28.2 26.8 1.4 5% 7%
Other 0.5 1.6 (1.1) —% —%
Total molecular diagnostic revenue 505.6 369.5 136.1
Pharmaceutical and clinical services revenue 24.2 32.9 (8.7) 5% 8%
Total revenue $ 529.8 $ 402.4 $ 127.4 100% 100%

Molecular diagnostic revenues for the nine months ended September 30, 2021 increased $136.1 million compared to the same period in the prior year. Revenue for the nine months ended September 30, 2020 was negatively impacted by the pandemic as patients faced significant obstacles to accessing health care professionals. Tumor Profiling revenues increased $53.2 million compared to the same period in the prior year due to a $27.4 million increase in revenue for Prolaris due to expanded coverage and the submission of claims for previously performed tests that were pending clarification of the coverage policy and a $21.1 million increase in revenues from myChoice CDx due to expansion in Japan and other areas. Hereditary Cancer revenues increased $35.9 million compared to the same period in the prior year due primarily to a 21% increase in volume. Revenues from Pharmacogenomics increased $23.5 million compared to the same period in the prior year due primarily to a 56% increase in volume. Prenatal revenues increased $23.2 million compared to the same period in the prior year due primarily to an increase of 15% in volume and an over 10% increase in the average reimbursement per test, as well as a change in estimate related to revenues from prior periods.

Pharmaceutical and clinical services revenues decreased for the nine months ended September 30, 2021 compared to the same period in the prior year due to decreased revenue attributable to the sale of Myriad RBM, Inc. on July 1, 2021, which generated $28.9 million in revenue during the prior period and the sale of the Clinic, an internal medicine emergency hospital, which was sold in February 2020 and generated $3.9 million in revenue during the prior period. The decrease was partially offset by $2.9 million generated from processing COVID-19 tests in the current period.

~~Cost of Sales~~

Nine months ended September 30,
(in millions) 2021 2020 Change
Cost of molecular diagnostic testing $ 139.9 $ 115.2 $ 24.7
Cost of molecular diagnostic testing as a % of revenue 27.7 % 31.2 %
Cost of pharmaceutical and clinical services $ 11.9 $ 15.8 $ (3.9)
Cost of pharmaceutical and clinical services as a % of revenue 49.2 % 48.0 %

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The Cost of molecular diagnostic testing as a percentage of revenue decreased from 31.2% to 27.7% during the nine months ended September 30, 2021 compared to the same period in the prior year. The decrease was primarily driven by the increase in revenue from higher test volumes during the period as the same period from the prior year was impacted by COVID-19; thus, costs decreased as a percentage of revenue as revenue from increases in test volumes outpaced personnel and materials costs to perform the tests.

~~The cost of pharmaceutical and clinical services decreased compared to the same period in the prior year due to the sale of Myriad RBM, Inc. that was completed on July 1, 2021.~~

~~Research and Development Expense~~

Nine months ended September 30,
(in millions) 2021 2020 Change
R&D expense $ 61.4 $ 54.7 $ 6.7
R&D expense as a % of total revenue 11.6 % 13.6 %

Research and development expense for the nine months ended September 30, 2021 increased compared to the same period in the prior year primarily due to increases in costs incurred in the current period as part of the Company’s strategic transformation initiatives, increases in lab expenses, and increases in compensation costs as a result of employee bonus reductions in the prior period stemming from the significant impact of COVID-19 on the Company's financial results.

~~Selling, General and Administrative Expense~~

Nine months ended September 30,
(in millions) 2021 2020 Change
Selling, general and administrative expense $ 460.5 $ 364.4 $ 96.1
Selling, general and administrative expense as a % of total revenue 86.9 % 90.6 %

Selling, general and administrative expense increased for the nine months ended September 30, 2021 compared to the same period in the prior year primarily due to a $48.0 million legal accrual related to the Crescendo Bioscience, Inc. qui tam lawsuit, a $14.4 million increase in costs incurred in the current period as part of the Company's strategic transformation initiative, and a $10.5 million increase in stock-based compensation due to lower stock-based compensation in the prior period as a result of adjustments to stock-based compensation related to the departure of our former Chief Executive Officer, as well as an $8.5 million increase in bonus expense as a result of employee bonus reductions in the prior year stemming from the significant impact of COVID-19 on the Company's financial results, a $5.6 million increase in legal expenses, a $3.4 million increase in commissions due to increases in sales, and a $2.9 million increase in consulting fees. Increases were partially offset by a $5.1 million decrease in amortization expense and a decrease in sales and marketing expenses of $2.6 million due primarily to fewer in-person sales and marketing events and travel-related expenses.

~~Change in the Fair Value of Contingent Consideration~~

Nine months ended September 30,
(in millions) 2021 2020 Change
Change in the fair value of contingent consideration $ 1.7 $ (4.5) $ 6.2
Change in the fair value of contingent consideration as a % of total revenue 0.3 % (1.1) %

The fair value of contingent consideration for the nine months ended September 30, 2021 increased compared to the same period in the prior year due to changes in timing of expected cash payments associated with the contingent consideration related to the Sividon Diagnostics GmbH acquisition in fiscal year 2016.

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~~Goodwill and long-lived asset impairment charges~~

Nine months ended September 30,
(in millions) 2021 2020 Change
Goodwill and long-lived asset impairment charges $ 1.8 $ 98.4 $ (96.6)
Goodwill and long-lived asset impairment charges as a % of total revenue 0.3 % 24.5 %

Goodwill and long-lived asset impairment charges decreased for the nine months ended September 30, 2021 compared to the same period in the prior year primarily due to the Company recognizing goodwill impairment charges in the prior period related to the Myriad Autoimmune reporting unit, as well as additional charges related to the abandonment of an in-process research and development intangible asset during the prior period.

~~Other Income (Expense), Net~~

Nine months ended September 30,
(in millions) 2021 2020 Change
Other income (expense), net $ 133.8 $ 8.3 $ 125.5

Other income (expense), net increased for the nine months ended September 30, 2021 compared to the same period in the prior year due primarily to the combined $152.2 million net gain recognized on the sales of Myriad RBM, Inc. and the Myriad myPath, LLC laboratory in the current period, partially offset by expenses or losses in the current period, including the $0.6 million net loss recognized on the sale of the Myriad Autoimmune business unit and losses of $5.2 million and $6.5 million for a non-cancelable purchase commitment and inventory, respectively, recognized in connection with the divestiture transactions. Increases were also partially offset by the receipt of $14.6 million in stimulus funds from the CARES Act in the prior period.

~~Income Tax Expense (Benefit)~~

Nine months ended September 30,
(in millions) 2021 2020 Change
Income tax benefit $ 6.0 $ (47.4) $ 53.4
Effective tax rate (44.1) % 20.3 %

~~Our tax rate is the product of a blended U.S. federal effective rate of 21.0% and a blended state income tax rate of approximately 3.4%~~4.2%. Certain significant or unusual items are separately recognized during the period in which they occur and can be a source of variability in the effective tax rates from period to period.

Income tax ~~expense~~benefit for the ~~nine~~three months ended September 30, ~~2021~~2022 was ~~$6.0~~$9.1 million, and our effective tax rate was ~~(44.1)%~~20.6%. ~~The change in~~For the three months ended September 30, 2022, our effective tax rate ~~for~~differs from the ~~nine~~U.S. federal statutory rate primarily due to disallowed executive compensation, uncertain tax positions, and stock compensation. For the three months ended September 30, 2021, ~~as compared to~~our effective tax rate differs from the ~~same period in the prior year is~~U.S. federal statutory rate primarily due to disallowed executive compensation, the tax ~~benefit recorded in the prior year related to~~impact of the CARES Act, ~~tax expense recorded in the prior year related to asset impairments, tax expense recorded in the current year related to the~~ differences between the book and tax basis of assets divested, and stock compensation.

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Results of Operations for the Nine Months Ended September 30, 2022 and 2021

The results of operations for the nine months ended September 30, 2022 and 2021 are discussed below.

Revenue


	Nine months ended September 30,				Change		% of Total Revenue
(in millions)	2022		2021		2022		2022	2021
Molecular diagnostic revenues:
Hereditary Cancer	$	220.6	$	241.5	$	(20.9)	44%	46%
Tumor Profiling	96.9		94.4		2.5		19%	18%
Prenatal	87.3		76.7		10.6		17%	14%
Pharmacogenomics	95.5		64.3		31.2		19%	12%
Autoimmune	0.3		28.2		(27.9)		—%	5%
Other	—		0.5		(0.5)		—%	—%
Total molecular diagnostic revenue	500.6		505.6		(5.0)
Pharmaceutical and clinical service revenue	—		24.2		(24.2)		—%	5%
Total revenue	$	500.6	$	529.8	$	(29.2)	100%	100%

Molecular diagnostic revenue for the nine months ended September 30, 2022 decreased $5.0 million compared to the same period in the prior year. Autoimmune revenues decreased $27.9 million due to the sale of the Myriad Autoimmune business on September 13, 2021. Hereditary Cancer revenues decreased $20.9 million compared to the same period in the prior year due primarily to a 4% decrease in volume and a 5% decrease in average reimbursement per test driven by changes in foreign exchange rates. These decreases in revenue were partially offset by increases across other products. Revenue from Pharmacogenomics increased $31.2 million compared to the same period in the prior year due primarily to a 40% increase in volume. Prenatal revenues increased $10.6 million compared to the same period in the prior year due primarily to a 15% increase in the average reimbursement per test. Tumor Profiling revenues increased $2.5 million compared to the same period in the prior year due to a 3% increase in volume and a shift in product mix, partially offset by a decrease in international revenue due to changes in foreign exchange rates and a one-time milestone revenue earned in the prior period.

Pharmaceutical and clinical service revenues were $24.2 million in the prior period. As a result of the sale of Myriad RBM, Inc. on July 1, 2021, there were no Pharmaceutical and clinical services revenues during the current period.

Cost of Sales


	Nine months ended September 30,
(in millions)	2022			2021			Change
Cost of molecular diagnostic testing	$	148.1		$	139.9		$	8.2
Cost of molecular diagnostic testing as a % of revenue	29.6		%	27.7		%
Cost of pharmaceutical and clinical services	$	—		$	11.9		$	(11.9)
Cost of pharmaceutical and clinical services as a % of revenue	—		%	49.2		%

The cost of molecular diagnostic testing as a percentage of revenue increased from 27.7% to 29.6% during the nine months ended September 30, 2022 compared to the same period in the prior year. The increase was primarily driven by the shift in the product mix for the current period and an increase in compensation costs due to an increase in the number of employees.

The cost of pharmaceutical and clinical services as a percentage of revenue was 49.2% for the nine months ended September 30, 2021. The sale of Myriad RBM, Inc. was completed on July 1, 2021, and as a result there were no corresponding costs during the current period.

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Research and Development Expense


	Nine months ended September 30,
(in millions)	2022			2021			Change
R&D expense	$	62.0		$	61.4		$	0.6
R&D expense as a % of total revenue	12.4		%	11.6		%

Research and development expense for the nine months ended September 30, 2022 increased compared to the same period in the prior year primarily due to an increase in compensation expense and computer hardware and software costs in the current period, partially offset by a decrease in clinical costs and costs incurred in the current period related to the Company’s strategic transformation initiatives as compared to the same period in the prior year.

Selling, General and Administrative Expense


	Nine months ended September 30,
(in millions)	2022			2021			Change
Selling, general and administrative expense	$	368.2		$	462.2		$	(94.0)
Selling, general and administrative expense as a % of total revenue	73.6		%	87.2		%

Selling, general and administrative expense decreased for the nine months ended September 30, 2022 compared to the same period in the prior year primarily due to a $71.6 million decrease in legal expenses, which is primarily driven by a $48.0 million legal accrual related to the Crescendo Bioscience, LLC qui tam lawsuit in the prior period, a $14.0 million legal accrual related to the Abelli settlement in the prior period, and the receipt of $11.4 million from insurers to offset the previously accrued Abelli settlement and other legal expenses in the current period, a $16.8 million decrease in costs incurred in the current period as part of the Company's strategic transformation initiative, which is largely due to a decrease in retention and severance costs in the current period, a $15.3 million decrease in compensation-related expenses due primarily to a decrease in bonus and commission expenses, a $10.1 million decrease in amortization expense due to intangible assets sold in the divestitures in the prior year, partially offset by an $11.4 million increase in sales and marketing expenses due to more in-person sales and marketing events and travel-related expenses in the current period, a $3.6 million increase in consulting expenses, and a $2.5 million increase in computer and hardware expenses.

Goodwill and long-lived asset impairment charges


	Nine months ended September 30,
(in millions)	2022			2021			Change
Goodwill and long-lived asset impairment charges	$	10.7		$	1.8		$	8.9
Goodwill and long-lived asset impairment charges as a % of total revenue	2.1		%	0.3		%

Goodwill and long-lived asset impairment charges increased for the nine months ended September 30, 2022 compared to the same period in the prior year primarily due to the Company recognizing an $8.6 million impairment to right-of-use assets and a $2.1 million impairment to the related leasehold improvements in the current period as a result of its decision to no longer use one of its facilities in order to consolidate space. During the prior period, the Company recognized a $1.8 million impairment to right-of-use assets as a result of the voluntary early termination of certain lease agreements to consolidate space.

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Other Income (Expense), Net


	Nine months ended September 30,
(in millions)	2022		2021		Change
Other income (expense), net	$	(0.1)	$	133.8	$	(133.9)

Other income (expense), net decreased for the nine months ended September 30, 2022 compared to the same period in the prior year due primarily to the $121.0 million net gain recognized on the sale of Myriad RBM, Inc. and the $31.2 million net gain recognized on the sale of the Myriad myPath, LLC laboratory in the prior period, partially offset by charges in the prior period, including losses of $5.2 million and $6.5 million for a non-cancelable purchase commitment and inventory, respectively, recognized in connection with the divestiture transactions, as well as a $1.5 million decrease in interest expense in the current period. The interest expense in the prior period is related to the debt outstanding at that time with no corresponding debt outstanding in the current period, as the debt was repaid in full on July 30, 2021.

Income Tax Benefit


	Nine months ended September 30,
(in millions)	2022			2021			Change
Income tax benefit	$	(18.8)		$	6.0		$	(24.8)
Effective tax rate	21.2		%	(44.1)		%

Our tax rate is the product of a blended U.S. federal effective rate of 21.0% and a blended state income tax rate of approximately 4.2%. Certain significant or unusual items are separately recognized during the period in which they occur and can be a source of variability in the effective tax rates from period to period.

Income tax benefit for the nine months ended September 30, 2022 was $18.8 million, and our effective tax rate was 21.2%. For the nine months ended September 30, 2022, our effective tax rate differs from the U.S. federal statutory rate primarily due to disallowed executive compensation expenses, uncertain tax positions, stock compensation and asset impairments. For the nine months ended September 30, 2021, our effective tax rate differs from the U.S. federal statutory rate primarily due to disallowed executive compensation, differences between the book and tax basis of assets divested, the tax impact of the CARES Act, stock compensation, and release of a valuation ~~allowance, and stock compensation expense.~~allowance.

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Liquidity and Capital Resources

Our primary sources of liquidity are our cash, cash equivalents and marketable investment securities, our expected future cash flows from operations, ~~our cash flows from investing activities,~~ and, in certain circumstances, as discussed below, amounts available for borrowing under our Amended Facility. Our capital deployment strategy focuses on use of resources in the key areas of research and development, technology and acquisitions. We believe that investing organically through research and development ~~and~~or acquisitively to support business strategy provides the best return on invested capital. During the three months ended September 30, 2021, our liquidity increased $346.6 million from the combined proceeds from the sales of Myriad RBM, Inc. and the Myriad Autoimmune business. The cash generated from these divestitures provides us with additional liquidity as we seek out strategic opportunities for capital deployment.

We believe that our existing capital resources will be sufficient to meet our ~~current and~~ projected operating requirements for the foreseeable future. In addition, our capital resources and cash on hand may be used for acquisitions or other strategic investments.

All ~~remaining~~previously outstanding borrowings under our Amended Facility, which matures on July 31, 2023, were repaid on July 30, 2021 using cash generated from ~~our recent divestitures.~~divestitures and as such, we have no outstanding borrowings as of September 30, 2022. Our available capital resources, however, may be consumed more rapidly than currently expected, or may be insufficient, and we may need or want to raise additional financing. We may not be able to secure such financing in a timely manner or on favorable terms, if at ~~all.~~all, and the current rising interest rate environment could make any potential financing more difficult or expensive to obtain. In addition, we have a decreased borrowing limit and are subject to financial covenants ~~as part of~~under our Amended Facility, ~~that~~which could limit our ability to incur additional ~~indebtedness.~~indebtedness or impact our decision to pursue other financing. Without additional funds, we may be forced to delay, scale back or eliminate some of our sales and marketing efforts, research and development activities, or other operations, and potentially delay development of our diagnostic tests in an effort to provide sufficient funds to continue our operations. If any of these events occurs, our ability to achieve our development and commercialization goals could be adversely affected.

The Amended Facility restricts our ability to make future borrowings if unrestricted cash, cash equivalents and marketable securities exceed $150.0 million, unless such borrowings are used in connection with certain permitted acquisitions. Unrestricted cash, cash equivalents and marketable securities totaled ~~$413.6~~$259.2 million as of September 30, ~~2021.~~2022. Our revolving commitment amount is ~~$250.0~~$200.0 million as of ~~September 30, 2021.~~July 26, 2022, with a further reduction to $150.0 million by December 31, 2022. As ~~the Company's~~our total unrestricted cash, cash equivalents, and marketable securities exceeded $150.0 million as of September 30, ~~2021,~~2022, we ~~will be~~are unable to make future borrowings unless related to a permitted acquisition. In addition, ~~following~~we are subject to a minimum liquidity covenant, which requires us to maintain liquidity—defined as the ~~expiration~~sum of our unrestricted cash, cash equivalents and marketable investment securities plus the aggregate undrawn and available amount of the ~~waiver~~ revolving commitments—of the leverage ratio and interest coverage ratio covenants, which waiver is effective until March 31, 2022, our ability to borrow under the Amended Facility will be limited if we are unable to comply with those financial covenants.$150.0 million.

From time to time, we enter into purchase commitments or other agreements that may materially impact our liquidity position in future periods. In ~~April 2021,~~February 2022, we entered into a non-cancelable operating lease for ~~our new corporate headquarters~~approximately 230,000 square feet in west Salt Lake City, ~~Utah, commenced with~~Utah. The lease has a ~~lease~~ term of 15 years, ~~and total~~which, along with rent payments, is expected to commence in the third quarter of 2023. Total future rent payments under the lease is approximately $77.8 million. In December 2021, we entered into a non-cancelable operating lease for approximately 63,000 square feet in South San Francisco, California, which, along with rent payments, is expected to commence in the third quarter of 2023. Total future rent payments under the lease are approximately ~~$67.0 million as of September 30, 2021.~~$58.8 million. In addition, in April 2022, we ~~have~~ ~~accrued~~paid $48.0 million for ~~a potential~~the settlement of the qui tam lawsuit against Crescendo Bioscience, ~~Inc.~~LLC and the ~~Company, which is included in accrued liabilities in our Condensed Consolidated Balance Sheet.~~

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Company.

Due to the ~~continuing~~continually evolving global situation ~~from the COVID-19 pandemic, including the emergence of the more highly transmissible Delta coronavirus variant and its impact on the ongoing recovery~~ from the COVID-19 pandemic, it is not possible to predict whether ~~unanticipated~~ongoing consequences of the pandemic are reasonably likely to materially affect our liquidity and capital resources in the future. Because of the ~~specialized scientific~~technical nature of our business and our focus on science, research and development, we are highly dependent upon our ability to attract and retain highly qualified and experienced management, scientific, and technical personnel. Competition and compensation for such personnel and other qualified personnel ~~rose as employment vacancies surged during~~have increased the ~~nine months ended September 30, 2021,~~difficulty and ~~job applicants are often seeking a more flexible work arrangement over the long term as a condition~~cost of employment. President Biden's administration is in the process of implementing a mandate requiring companies with 100 or more employees to require full COVID-19 vaccination or regular testing for COVID-19 as a condition of employment. The mandate could increase already elevated employment vacancies. In addition, any future federal or state regulations that could require us to mandate full COVID-19 vaccinations for our employees, or any future decision on our part to voluntarily require our employees to receive a COVID-19 vaccine, could impact our ability to hirehiring and ~~retain employees.~~retaining qualified personnel. Loss of the services of or failure to recruit additional key management, scientific and technical personnel and other qualified personnel who are necessary to operate our business would adversely affect our ~~research~~business, and ~~development programs and molecular diagnostic business.~~it may have a material adverse effect on our business as a whole. Additionally, disruptions to our supply chain ~~as a result of COVID-19~~ could cause shortages of critical materials required to conduct our business, which may have a material adverse effect on our business as a whole. In addition, inflation led by supply constraints, federal stimulus funding, increases to household savings, and the sudden macroeconomic shift in activity levels arising from the loosening or removal of many government restrictions and the broader availability of COVID-19 vaccines, has had, and ~~may~~we expect it will continue to have, an impact on the ~~labor~~ costs we incur to attract and retain qualified personnel, costs to generate sales and produce diagnostic testing results, and costs of lab supplies.

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The following table represents the balances of cash, cash equivalents and marketable investment securities:


(in millions)	(in millions)	September 30, 2021		December 31, 2020		Change		(in millions)	September 30, 2022		December 31, 2021		Change
Cash and cash equivalents	Cash and cash equivalents	$	295.2	$	117.0	$	178.2	Cash and cash equivalents	$	110.7	$	258.4	$	(147.7)
Marketable investment securities	Marketable investment securities	70.9		33.7		37.2		Marketable investment securities	82.5		81.4		1.1
Long-term marketable investment securities	Long-term marketable investment securities	47.5		21.0		26.5		Long-term marketable investment securities	66.0		59.0		7.0
Cash, cash equivalents and marketable investment securities	Cash, cash equivalents and marketable investment securities	$	413.6	$	171.7	$	241.9	Cash, cash equivalents and marketable investment securities	$	259.2	$	398.8	$	(139.6)

The ~~increase~~decrease in cash, cash equivalents, and marketable investment securities was primarily driven by ~~$379.1~~$98.6 million in ~~total~~ cash ~~consideration~~used by operations, $30.7 million used for capital expenditures, and $5.2 million used for the payment of withholding tax for the issuance of common stock, net of proceeds from the ~~sale~~issuance of Myriad RBM, Inc., select assets of the Myriad Autoimmune business unit, and the Myriad myPath, LLC laboratory, the receipt of an $89.6 million U.S. federal tax refund in the quarter ended March 31, 2021, and proceeds of $90.0 million from the exercise of stock options, partially offset by $226.4 million in repayments of the Company's revolving credit facility during the nine months ended September 30, 2021 and $10.5 million in transaction expenses related to the foregoing divestitures, as well as by cash used in operating activities as part of our normal course of business.common stock.

The following table represents the Condensed Consolidated Cash Flow Statement:

Nine Months Ended September 30,
(in millions) 2021 2020 Change
Cash flows from operating activities $ 28.1 $ (12.5) $ 40.6
Cash flows from investing activities 300.3 50.6 249.7
Cash flows from financing activities (149.5) (2.8) (146.7)
Effect of foreign exchange rates on cash and cash equivalents (0.7) 0.3 (1.0)
Change in cash and cash equivalents classified as held for sale — 1.5 (1.5)
Net increase in cash and cash equivalents 178.2 37.1 141.1
Cash and cash equivalents at the beginning of the period 117.0 81.2 35.8
Cash and cash equivalents at the end of the period $ 295.2 $ 118.3 $ 176.9


	Nine Months Ended September 30,
(in millions)	2022		2021		Change
Cash flows provided by (used in) operating activities	$	(98.6)	$	28.1	$	(126.7)
Cash flows provided by (used in) investing activities	(41.9)		300.3		(342.2)
Cash flows used in financing activities	(5.9)		(149.5)		143.6
Effect of foreign exchange rates on cash and cash equivalents	(1.3)		(0.7)		(0.6)
Net increase (decrease) in cash and cash equivalents	(147.7)		178.2		(325.9)
Cash and cash equivalents at the beginning of the period	258.4		117.0		141.4
Cash and cash equivalents at the end of the period	$	110.7	$	295.2	$	(184.5)

Cash Flows from Operating Activities

The ~~increase~~decrease in cash flows from operating activities for the nine months ended September 30, ~~2021,~~2022, compared to the same period in the prior year, was primarily due to the change in the balance of prepaid taxes due to the receipt of an $89.6 million U.S. federal tax refund ~~partially offset by a~~in the prior period and an $83.4 million decrease in ~~cash flows from operating activities~~accrued liabilities for the current period, which was primarily driven by ~~a $44.9 million change in trade accounts receivable in the current period compared to the prior period due to the change in sales volumes and cash collections as a result~~legal settlement payments of ~~the significant impact of COVID-19 on the Company's financial results during the prior period.~~

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$62.0 million.

Cash Flows from Investing Activities

The ~~increase~~decrease in cash flows from investing activities for the nine months ended September 30, ~~2021,~~2022, compared to the same period in the prior year, was primarily due to ~~incremental~~the $379.1 million cash proceeds ~~of $357.8 million~~ from divestitures in the ~~current~~prior period, ~~as compared to the prior period. This increase is partially offset by an increase of $85.2 million in purchases of marketable investments securities~~with no corresponding proceeds in the current period, ~~as compared to the prior period,~~partially offset by a ~~decrease of $15.1~~$50.8 million increase in proceeds from marketable investment securities ~~during the current period, and an increase of $7.8 million in capital expenditures~~ in the current period.

Cash Flows from Financing Activities

The decrease in cash flows ~~from~~used in financing activities for the nine months ended September 30, ~~2021,~~2022, compared to the same period in the prior year, was primarily due to the use of $226.4 million in cash for repayments of the Amended Facility during the nine months ended September 30, ~~2021. The decrease was~~2021, partially offset by ~~an increase~~a decrease of ~~$83.1~~$86.6 million in proceeds from the exercise of stock options, net of shares exchanged for payroll withholding tax, ~~for the nine months ended September 30, 2021~~ compared to the same period in the prior year.

Effects of Inflation

We do not believe that inflation has had a material impact on our business, sales, or operating results during the periods presented. However, inflation, led by supply constraints, federal stimulus funding, increases to household savings, and the sudden macroeconomic shift in activity levels arising from the loosening or removal of many government restrictions and the broader availability of COVID-19 vaccines,Inflation has had, and may continue to have, an impact on the labor costs we incur to attract and retain qualified personnel, costs to generate sales and produce diagnostic testing results, and costs of lab supplies. Inflationary costs ~~may impact~~have impacted our profitability and ~~could~~continue to adversely affect our business, financial condition and results of operations. In addition, increased inflation has had, and may continue to have, an effect on interest rates. Increased interest rates may adversely affect our borrowing rate and our ability to obtain, or the terms under which we can obtain, any potential additional funding.

~~Share Repurchase Program~~

~~Our Board~~

Table of Directors has previously authorized us to repurchase up to $200.0 million of our outstanding common stock. We may repurchase our common stock from time to time or on an accelerated basis through open market transactions or privately negotiated transactions as determined by our management. The amount and timing of stock repurchases under the program will depend on business and market conditions, stock price, trading restrictions, acquisition activity and other factors. As of September 30, 2021, we are authorized to repurchase up to $110.7 million under our current share repurchase authorization. See “Part II, Item 2. Unregistered Sales of Equity Securities and Use of Proceeds – Issuer Purchases of Equity Securities” below.Contents

Critical Accounting ~~Policies~~Estimates

Critical accounting ~~policies~~estimates are those policies which are both important to the presentation of a company’s financial condition and results and require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. For a further discussion of our critical accounting ~~policies,~~estimates, see our ~~Transition~~Annual Report on Form 10-K. No significant changes to our accounting policies took place during the nine months ended September 30, ~~2021.~~2022.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

~~There~~We have ~~been no material changes~~exposure to various foreign currency exchange rate fluctuations with regard to certain agreements with service providers. While our expenses are predominantly denominated in U.S. dollars, approximately 10% of our revenues are denominated in other currencies, primarily in Japanese yen. A hypothetical 10% change in the value of the Japanese yen relative to the U.S. dollar would result in a 1% change in our revenues. Although we also have certain operations denominated in euros, Swiss francs, and Great British pounds, among other currencies, those operations are subject to less overall market risk ~~during the nine months ended September 30, 2021 compared~~due to the ~~disclosures~~revenue and expenses being denominated in ~~Part II, Item 7A of our Transition Report on Form 10-K, which are incorporated by reference herein.~~

the same currency.

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Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (“Disclosure Controls”) within the meaning of Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended ~~or the Exchange Act.~~(the "Exchange Act"). Our Disclosure Controls are designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act, such as this Quarterly Report on Form 10-Q, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms. Our Disclosure Controls are also designed to ensure that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating our Disclosure Controls, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily applied its judgment in evaluating and implementing possible controls and procedures.

As of the end of the period covered by this Quarterly Report on Form 10-Q, we evaluated the effectiveness of the design and operation of our Disclosure Controls, which was done under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer. Based on the evaluation of our Disclosure Controls, our Chief Executive Officer and Chief Financial Officer have concluded that, as of September 30, ~~2021,~~2022, our Disclosure Controls are not effective.

Management ~~has~~ concluded that, as of December 31, 2021, a material weakness in internal control over financial reporting exists related to ~~our quarterly income tax provision process. Specifically, we did not provide adequate review and control with respect~~general information technology controls for information systems that are relevant to the ~~completeness and accuracy~~preparation of ~~inputs used in~~ the ~~gain/loss calculation~~financial statements. Specifically, the material weakness resulted from the aggregation of control deficiencies related to ~~a divestiture within~~systems supporting the ~~interim consolidated income tax provision and related accrual.~~Company's internal control processes. This material weakness has not been remediated as of September 30, 2022. Our IT-dependent business process controls were also deemed ineffective because they could have been adversely impacted. While the ~~control deficiency~~aggregation of these deficiencies did not result in aany misstatement of ~~our previously issued~~the consolidated financial statements, the ~~control deficiency~~material weakness could have resulted in a misstatement ~~of the income tax related accounts~~impacting account balances or disclosures that would have resulted in a material misstatement ~~of our annual or interim~~to the consolidated financial statements that would not have been prevented or detected on a timely basis.

Plan to Remediate Material Weakness

Management is committed to the remediation of the material weakness described above, as well as the continued improvement of our internal control over financial reporting. Management has been implementing, and will continue to implement, measures designed to ensure that our controls are designed, implemented, and operating effectively.

~~For~~

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We have begun the process of, and we are focused on, designing and implementing effective internal control measures to improve our internal control over financial reporting and remediate the material ~~weakness described above, management~~weaknesses identified above. Our efforts include the following actions:

Information Technology General Controls ("ITGCs")

•We have conducted and will ~~take steps that address~~continue to conduct additional training for our IT personnel to ensure a clear understanding of risk assessment, controls and monitoring activities related to automated processes and systems and ITGCs related to financial reporting.

•We have implemented and continue to implement improved IT policies, procedures and control activities for key systems which impact our financial reporting.

•We are increasing resources dedicated to monitoring ITGCs related to financial reporting, including additional personnel with the ~~underlying causes, including enhancing~~appropriate level of knowledge, experience and training, to ensure compliance with policies and procedures.

•We hired a third-party to assist with the implementation of, and to review ofand provide feedback on, our remediation plan. In addition, the ~~information underlying discrete transactions in the interim income tax provision.~~ third-party is advising on best practices to further strengthen our IT control environment.

We intend to remediate this material weakness as soon as possible. We will continue to monitor the effectiveness of our controls and will make any further changes that management determines are appropriate.

Remediation of Previously Reported Material Weakness

The ~~prior period~~ material weakness ~~identified~~ in our internal control over financial reporting related to our income tax provision process identified in connection with the preparation of our ~~Consolidated Financial Statements~~condensed consolidated quarterly financial statements as of ~~and for the transition period ended December 31, 2020~~September 30, 2021 has been remediated. ~~The~~Specifically, we did not provide adequate review and control with respect to the completeness and accuracy of inputs used in the income tax provision and related accrual. While the control deficiency did not result in a misstatement of our previously issued consolidated financial statements, the control deficiency could have resulted in a misstatement of the income tax related accounts or disclosures that would have resulted in a material misstatement of our annual or interim consolidated financial statements that would not have been prevented or detected on a timely basis. This material weakness ~~identified related to the accounting for intercompany transactions, foreign currency exchanges and foreign currency translation related to our international subsidiaries. Specifically,~~has been remediated as ~~part~~ of our financial statement close process, certain of our control activities were not sufficiently designed or operating effectively to ensure all of our policies were in compliance with generally accepted accounting principles, consistent in their application, retained in appropriate documentation and communicated to relevant parties. As a result of the material weakness, we recorded certain immaterial corrections to intercompany accounts, as well as foreign currency exchange and translation gains and losses, in our Consolidated Financial Statements for the transition period ended DecemberMarch 31, ~~2020.~~2022.

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~~We implemented control measures to~~To improve our internal control over financial reporting and ~~remediated the~~remediate this prior period material ~~weakness. We took the following actions to remediate the prior period material weakness:~~

•Weweakness, we designed ~~additional control~~ and ~~review procedures needed to provide more robust and comprehensive internal~~implemented enhanced controls over ~~financial reporting that address~~ the ~~risks~~review of ~~material misstatement related to~~information underlying discrete transactions in the ~~accounting for intercompany transactions, foreign currency exchanges and foreign currency translation within our business processes.~~income tax provision.

•~~We implemented additional application controls in our financial systems, implemented formal review procedures, and formally documented our newly designed processes for the identified areas.~~

•~~We subjected the additional controls implemented to testing and concluded that the controls are operating effectively.~~

Changes in Internal Controls

The Company has completed a multi-year transformation project to achieve better analytics and process efficiencies through the use of Oracle Fusion Cloud Services System ("Oracle Cloud"). As of October 1, 2021, Oracle Cloud is now our primary accounting system. Emphasis will continue to be placed on the maintenance of effective internal controls and assessment of the design and operating effectiveness of key control activities in the new system.

~~Other than as described above, there~~There were no changes in our internal control over financial reporting that occurred during the ~~three~~nine months ended September 30, ~~2021~~2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II - Other Information

Item 1. Legal Proceedings.

~~Qui Tam Lawsuit~~

~~In June 2016, our wholly owned subsidiary, Crescendo Bioscience, Inc. (“CBI”), received a subpoena from the Office of Inspector General of the Department of Health~~For information regarding certain current legal proceedings, see Note 13, "Commitments and ~~Human Services requesting that CBI produce documents relating~~Contingencies - Legal Proceedings" in Notes to entities that received payment from CBI for the collection and processing of blood specimens for testing, including a named unrelated company, healthcare providers and other third party entities. The Office of Inspector General subsequently requested additional documentation in December 2017. CBI provided to the Office of Inspector General the documents requested. On January 30, 2020, the United States District Court for the Northern District of California unsealed a qui tam complaint, filed on April 16, 2016 against CBI and the Company, alleging violations of the Federal and California False Claims Acts and the California Insurance Fraud Prevention Act. On January 22, 2020, after a multi-year investigation into CBI’s and the Company’s alleged conduct, the United States declined to intervene. On January 27, 2020, the State of California likewise filed its notice of declination. The Company was not aware of the complaint until after it was unsealed. On May 23, 2020, the court denied CBI and the Company’s motion to dismiss. We have accrued $48.0 million for a potential settlement of this qui tam lawsuit against CBI and the Company, which is included in accrued liabilities in our Condensed Consolidated Balance Sheet. If no settlement is reached, we intend to continue to vigorously defend this case, but we cannot predict with any degree of certainty the ultimate resolution of this matter or determine whether, or to what extent, any loss with respect to this matter may exceed the amount that we have accrued.

~~Purported Securities Class Action~~

On September 27, 2019, a purported class action complaint was filed in the United States 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,~~Statements, 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 our business, operations, and acquisitions. The lead plaintiff seeks the payment of damages allegedly sustained by it and the purported 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 United States District Court for the District of Utah denied the Company’s motion to dismiss. We intend to vigorously defend against this action. Due to the nature of this matter and inherent uncertainties, it is not possible to provide an evaluation of the likelihood of an unfavorable outcome or an estimate of the amount or range of potential loss, if any.

~~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 its current and former directors, Lawrence C. Best, Walter Gilbert, John T. Henderson, Heiner Dreismann, Dennis Langer, Lee N. Newcomer, S. 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 our 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. We intend to vigorously defend against this action. Due to the nature of this matter and inherent uncertainties, it is not possible to provide an evaluation of the likelihood of an unfavorable outcome or an estimate of the amount or range of potential loss, if any.

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On September 17, 2021, a second stockholder derivative complaint was filed in the United States District Court for 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. We intend to vigorously defend against this action. Due to the nature of this matter and inherent uncertainties, it is not possible to provide an evaluation of the likelihood of an unfavorable outcome or an estimate of the amount or range of potential loss, if any.

~~Other Legal Proceedings~~

On July 27, 2020, a lawsuit was filed against the Company in the Superior Court of Suffolk County, Massachusetts, by Heide Abelli and Victor Pricolo. The plaintiffs claim negligence, breach of contract and associated torts in connection with an alleged error in testing performed by the Company in 2004. The plaintiffs seek damages allegedly sustained by them by reason of the allegations set forth in their complaint, together with interest and costs. We intend to vigorously defend against this action. Due to the nature of this matter and inherent uncertainties, it is not possible to provide an evaluation of the likelihood of an unfavorable outcome or an estimate of the amount or range of potential loss, if any.

On August 24, 2018, our wholly owned subsidiary, Assurex Health, Inc. (“Assurex”), was served with an Amended Complaint which had been filed in the Circuit Court of Cook County, Illinois, County Department, Law Division, Civil Action No. 2018 L 004972, by Pipe Trades Services MN Welfare Plan (“Pipe Trades”), as a qui tam relator, on behalf of the State of Illinois, Pipe Trades, and all others similarly situated, purportedly arising from Assurex’s alleged violations of the Illinois Insurance Claims Fraud Prevention Act and other causes of action. Pipe Trades seeks certification of a putative class, certification as the purported class representative, and the payment of treble damages allegedly sustained by Pipe Trades and the purported class by reason of the allegations set forth in the amended complaint, plus statutory damages and penalties, plus interest, and legal and other costs and fees. The State of Illinois and Cook County, Illinois, have declined to intervene in the matter. On February 19, 2021, the court granted Assurex’s motion to dismiss the complaint, without prejudice and with leave for Pipe Trades to file an amended complaint, for failure to state a claim on which relief can be granted. On March 19, 2021, Pipe Trades filed an amended complaint. Assurex and Pipe Trades subsequently agreed to settle the case for $170,000, which settlement was approved by the State of Illinois and Cook County, Illinois on September 9, 2021. Accordingly, the court dismissed the case with prejudice on September 9, 2021.

~~Other than as set forth above, we~~ are ~~not a party to any legal proceedings that we believe will have a material impact on our business, financial position or results of operations.~~

included herein.

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Item 1A. Risk Factors.

In addition to the other information set forth in this Quarterly Report, you should carefully consider the risk factors and other cautionary statements described under the heading “Item 1A. Risk Factors” included in ~~the Transition~~our Annual Report on Form 10-K and our Quarterly Report on Form 10-Q for the quarter ended June 30, 2022, which could materially affect our business, financial condition or future results. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition or future results. There have been no material changes in our risk factors from those described in ~~the Transition~~our Annual Report on Form 10-K and our Quarterly Report on Form 10-Q for the quarter ended June 30, 2022, other than the updates to the risk ~~factors~~factor set forth below. We may disclose changes to risk factors or additional risk factors from time to time in our future filings with the SEC.

We have identified a material weakness in our internal control over accounting related to our quarterly income tax provision process and such weakness led to a conclusion that our internal control over financial reporting and disclosure controls and procedures were not effective as of September 30, 2021. Our inability to remediate the material weakness, our discovery of any additional weaknesses, or our inability to achieve and maintain effective disclosure controls and procedures and internal control over financial reportingface risks associated with currency exchange rate fluctuations, which could adversely affect our operating results.

We receive a portion of our revenues and pay a portion of our expenses in currencies other than the United States dollar, such as the Euro, the Swiss franc, the British pound, the Australian dollar and the Canadian dollar. As a result, we are at risk for exchange rate fluctuations between such foreign currencies and the United States dollar, which could affect the results of ~~operations,~~ our ~~stock price~~operations. If the U.S. dollar strengthens against foreign currencies, the translation of these foreign currency denominated transactions will result in decreased revenues and ~~investor confidence in our company.~~

~~Section 404 of~~operating expenses. During the ~~Sarbanes-Oxley Act of 2002 requires that companies evaluate~~three and report on the effectiveness of their internal control over financial reporting. In addition, we regularly engage our independent registered public accounting firm to report on its evaluation of those controls. As disclosed in more detail under Part I,Item 4, “Controls and Procedures” above, we have identified a material weakness as ofnine months ended September 30, ~~2021 in~~2022, our ~~internal control over accounting related~~revenues were negatively impacted by approximately $3.3 million and approximately $7.1 million, respectively, due to our quarterly income tax provision process. Specifically, we did not provide adequate review and control with respect to the completeness and accuracy of inputs used in the gain/loss calculation related to a divestiture within the interim consolidated income tax provision and related accrual. Due to the material weakness in our internal control over financial reporting, we have also concluded that our disclosure controls and procedures were not effective as of September 30, 2021.

Failure to have effective internal control over financial reporting and disclosure controls and procedures could impair our ability to produce accurate financial statements on a timely basis and could lead to a restatement of our financial statements. If, as a result of the ineffectiveness of our internal control over financial reporting and disclosure controls and procedures, we cannot provide reliable financial statements, our business decision processes may be adversely affected, our business and results of operations could be harmed, investors could lose confidence in our reported financial information and our ability to obtain additional financing, or additional financing on favorable terms, could be adversely affected. In addition, failure to maintain effective internal control over financial reporting could result in investigations or sanctions by regulatory authorities.

~~Our management will take steps to remediate the material weakness, including enhancing review of the information underlying discrete transactions in the interim income tax provision.~~foreign currency fluctuations. We intend to remediate this material weakness as soon as possible, but we cannot be certain as to when remediation will be completed. Additional details regarding the remediation efforts are disclosed under Part I, Item 4, “Controls and Procedures” above. In addition, we may in the future identify additional internal control deficiencies that could rise to the level of a material weakness or uncover other errors in financial reporting. During the course of our evaluation of this material weakness, we may identify areas requiring improvement and may be required to design additional enhanced processes and controls to address issues identified through this review. In addition, there can be no assurance that such remediation efforts will be successful, that our internal control over financial reporting will be effective as a result of these efforts or that any such future deficiencies identified may not be material weaknesses that would be required to be reported in future periods. In addition, we cannot assure you that our independent registered public accounting firm will be able to attest that such internal controls are effective when they are required to do so.

~~If we fail to remediate the material weakness and maintain effective disclosure controls and procedures or internal control over financial reporting, we~~ may not be able to ~~rely on the integrity~~offset adverse foreign currency impact with increased revenues. We do not currently utilize hedging strategies to mitigate foreign currency risk and even if we were to implement hedging strategies to mitigate foreign currency risk, these strategies might not eliminate our exposure to foreign exchange rate fluctuations and would involve costs and risks of our financial results, which could result in inaccurate or late reporting of our financial results, as well as delays or the inability to meet our reporting obligations or to comply with SEC rules and regulations. Any of these could result in delisting actions by the Nasdaq Stock Market, investigation and sanctions by regulatory authorities, stockholder investigations and lawsuits, and could adversely affect our business and the trading price of our common stock.

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~~Our financial condition and results of operations could be further adversely affected by the ongoing coronavirus pandemic.~~

~~Any outbreaks of COVID-19 (including its variant strains,~~their own, such as ongoing management time and expertise, external costs to implement the ~~highly transmissible Delta variant) or any other outbreak of contagious disease or adverse public health development, could have a further material~~strategies and adverse effect on our business operations. For example, government public health officials may place additional restrictions to curb the spread of COVID-19, limiting patients' access to our services, and patients may elect to defer certain testing, each of which would impede our progress in returning to profitability and recovering from the earlier effects of the COVID-19 pandemic. Such adverse effects could also include diversion or prioritization of healthcare resources away from the conduct of genetic testing, disruptions or restrictions on the ability of laboratories to process our tests, and delays or difficulties in patients accessing our tests. In addition, failure to comply with current or future federal or state regulations requiring us to mandate full COVID-19 vaccination for our employees, with or without a regular testing alternative, could result in our losing access to government funding and being fined per violation.

~~As COVID-19 continues to affect individuals and businesses around the globe, we will likely experience further disruptions from time to time that could severely impact our business, including:~~

•~~decreased volume of testing as a result of disruptions to healthcare providers and limitations on the ability of providers to administer tests;~~

•disruptions or restrictions on the ability of our, our collaborators’, or our suppliers’ personnel to travel, and temporary closures of our facilities or the facilities of our collaborators or suppliers;

•limitations on employee resources that would otherwise be focused on the development of our products, processing our diagnostic tests, and the conduct of our clinical trials, including because of sickness of employees or their families or requirements imposed on employees to avoid contact with large groups of people; and

•~~delays in necessary interactions with local regulators, ethics committees and other important agencies and contractors due to limitations in employee resources or access.~~

In addition, the continued spread of COVID-19 globally could further adversely affect our manufacturing and supply chain. Parts of our direct and indirect supply chain are located overseas and both international and domestic components may continue to be subject to disruption as a result of COVID-19 and ongoing responses to it. If the supplies and components necessary to manufacture our products become unavailable or are disrupted as a result of COVID-19 and ongoing responses to it, then we may not be able to successfully perform our research or operate our business on a timely basis or at all. Additionally, our results of operations could be adversely affected to the extent that the continued spread of COVID-19 or any other public health emergency harms our business or the economy in general either domestically or in any other region in which we do business.

The extent to which COVID-19 continues to affect our operations and impede our recovery from the earlier effects of the COVID-19 pandemic will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration, spread and severity of COVID-19 outbreaks, the rate of vaccination and efficacy of approved vaccines against COVID-19 and its variant strains, actions taken to contain COVID-19 or treat its impact, new information that may emerge concerning the health effects of COVID-19, and how quickly and to what extent normal economic and operating conditions would resume if the pandemic subsided, any of which could have a further adverse effect on our business and financial condition.

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~~If we fail to retain our key personnel and hire, train and retain qualified employees and consultants, we may not be able to successfully continue our business.~~

Because of the specialized scientific nature of our business, we are highly dependent upon our ability to attract and retain qualified management, scientific and technical personnel. Competition and compensation for such personnel and other qualified personnel rose as employment vacancies surged during 2021, and job applicants are often seeking a more flexible work arrangement over the long term as a condition of employment. President Biden's administration is in the process of implementing a mandate requiring companies with 100 or more employees to require full COVID-19 vaccination or regular testing for COVID-19 as a condition of employment. The mandate could increase already elevated employment vacancies. In addition, any future federal or state regulations that could require us to mandate full COVID-19 vaccinations for our employees, or any future decision on our part to voluntarily require our employees to receive a COVID-19 vaccine, could impact our ability to hire and retain employees. Loss of the services of or failure to recruit additional key management, scientific and technical personnel and other qualified personnel who are necessary to operate our business would adversely affect our research and development programs and molecular diagnostic business and may have a material adverse effect on our business as a whole. In addition, inflation arising from the recovery from the COVID-19 pandemic, led by supply constraints, federal stimulus funding, increases to household savings, and the sudden macroeconomic shift in activity levels arising from the loosening or removal of many government restrictions and the broader availability of COVID-19 vaccines in the United States, has had, and may continue to have, an impact on the costs that we incur to attract and retain qualified personnel and may make it more difficult for us to attract and retain such personnel.

Our agreements with our employees generally provide for employment that can be terminated by either party without cause at any time, subject to specified notice requirements. Further, the non-competition provision that certain key employees are subject to may not be enforceable under certain state or federal laws.potential accounting implications.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Issuer Purchases of Equity Securities

Our Board of Directors has previously authorized us to repurchase up to $200.0 million of our outstanding common stock, of which $110.7 million is still available to repurchase as of September 30, ~~2021.~~2022. We are authorized to complete the repurchase through open market transactions or through an accelerated share repurchase program, in each case to be executed at management’s discretion based on business and market conditions, stock price, trading restrictions, acquisition activity and other factors. The repurchase program may be suspended or discontinued at any time without prior notice.

No stock repurchases were made under our stock repurchase program during the ~~three~~nine months ended September 30, ~~2021.~~2022.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

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Item 5. Other Information.

~~None.~~

On October 31, 2022, our Board of Directors (the “Board”) approved an increase in the size of the Board from eight to nine members and appointed Paul M. Bisaro to fill the newly created vacancy, effective immediately, to serve as a Class III Director with a term expiring at our 2023 Annual Meeting of Stockholders. The Board has determined that Mr. Bisaro meets the independence requirements of the Nasdaq Stock Market Rules. The Board appointed Mr. Bisaro to serve on the Research and Product Innovation Committee of the Board and the Nominating, Environmental, Social and Governance Committee of the Board, in each case effective immediately.

40Mr. Bisaro will be compensated for his service as director on the same basis as our other non-employee directors, as more fully described in our non-employee director compensation policy (the “Non-Employee Director Compensation Policy”), a copy of which is included as Exhibit 10.2 hereto and incorporated by reference herein, as well as the “Director Compensation” section of our definitive proxy statement for the 2022 Annual Meeting of Stockholders filed with the Securities and Exchange Commission on April 14, 2022. Pursuant to the Non-Employee Director Compensation Policy, in connection with his appointment to the Board, Mr. Bisaro was granted a restricted stock unit award for our shares of common stock having an aggregate value of $350,000. The foregoing grant will vest one year following the grant date. Mr. Bisaro also entered into our standard indemnification agreement for directors.

There are no arrangements or understandings between Mr. Bisaro and any other person pursuant to which he was selected to serve on the Board, and Mr. Bisaro is not party to any related party transactions required to be reported pursuant to Item 404(a) of Regulation S-K.

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Item 6. Exhibits.

10.1

~~Amended~~Amendment No. 4, dated July 26, 2022, to the Credit Agreement, dated December 23, 2016, among the Company, the lenders from time to time party thereto, and ~~Restated 2012 Employee Stock Purchase Plan+~~JPMorgan Chase Bank, N.A., as administrative agent, as amended July 31, 2018, May 1, 2020, and February 22, 2021 (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K, File No. 000-26642, filed with the SEC on July 27, 2022).

10.2+

Non-Employee Director Compensation Policy+

31.1

Certification of Chief Executive Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002.

31.2

Certification of Chief Financial Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002.

32.1

Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Furnished).

101.INS

Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH

Inline XBRL Taxonomy Extension Schema Document

101.CAL

Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF

Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE

Inline XBRL Taxonomy Extension Presentation Linkbase Document

104

The cover page from the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, ~~2021~~2022 has been formatted in Inline XBRL.

(+) Management contract or compensatory plan ~~arrangement.~~

arrangement

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	MYRIAD GENETICS, INC.

Date: November ~~4, 2021~~2, 2022	By:	/s/ Paul J. Diaz
		Paul J. Diaz
		President and Chief Executive Officer
		(Principal executive officer)



Date: November ~~4, 2021~~2, 2022	By:	/s/ R. Bryan Riggsbee
		R. Bryan Riggsbee
		Chief Financial Officer
		(Principal financial ~~and~~officer)



Date: November 2, 2022	By:	/s/ Natalie Munk
		Natalie Munk
		Chief Accounting Officer
		(Principal accounting officer)

4237


(in millions)	Diagnostic		Other		Total
Beginning balance	$	272.3	$	56.9	$	329.2
Divestitures	(31.6)		(56.9)		(88.5)
Translation adjustments	(1.0)		—		(1.0)
Ending balance	$	239.7	$	—	$	239.7


(in millions)	Diagnostics		Other		Total
Three months ended September 30, 2021
Revenues	$	161.7	$	5.6	$	167.3
Depreciation and amortization	13.1		1.1		14.2
Segment operating loss	(21.7)		(58.2)		(79.9)

Three months ended September 30, 2020
Revenues	$	130.5	$	14.7	$	145.2
Depreciation and amortization	16.7		1.0		17.7
Segment operating loss	(0.3)		(39.3)		(39.6)

Nine months ended September 30, 2021
Revenues	$	496.6	$	33.2	$	529.8
Depreciation and amortization	45.8		3.7		49.5
Segment operating income (loss)	26.3		(173.7)		(147.4)

Nine months ended September 30, 2020
Revenues	$	362.0	$	40.4	$	402.4
Depreciation and amortization	50.2		3.1		53.3
Segment operating loss	(127.7)		(113.9)		(241.6)