~~Table of Conten~~t s

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, 2020~~March 31, 2021


☐			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 ~~November 2, 2020,~~April 28, 2021, the registrant had ~~75,210,480~~77,051,966 shares of $0.01 par value common stock outstanding.

~~Table of Conten~~t s

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~~,March 31, 2021 (unaudited) and December 31, 2020 ~~(Unaudited)and June 30,~~ 20 20	3

	Condensed Consolidated Statements of Operations for the three months ended ~~September 30~~,March 31, 2021 and 2020 ~~and 2019(Unaudited)~~(unaudited)	4

	Condensed Consolidated Statements of Comprehensive Loss for the three months ended ~~September 30~~,March 31, 2021 and 2020 ~~and 2019(Unaudited)~~(unaudited)	5

	Condensed Consolidated Statements of Stockholders’ Equity for the three months ended ~~September~~ 3 0 ,March 31, 2021 and 2020 ~~and 2019(Unaudited)~~(unaudited)	6

	Condensed Consolidated Statements of Cash Flows for the three months ended ~~September~~ 3 0 ,March 31, 2021 and 2020 ~~and 2019(Unaudited)~~(unaudited)	7

	Notes to Condensed Consolidated Financial Statements (Unaudited)	8

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	21

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2728

Item 4.	Controls and Procedures	2728

	PART II - Other Information

Item 1.	Legal Proceedings	2830

Item 1A.	Risk Factors	2831

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	2931

Item 3.	Defaults Upon Senior Securities	2931

Item 4.	Mine Safety Disclosures	3031

Item 5.	Other Information	3031

Item 6.	Exhibits	3031

	Signatures	3132

Table of ~~Conten~~t sContents

MYRIAD GENETICS, INC.

AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Inin millions)


							March 31, 2021		December 31, 2020
							(unaudited)
ASSETS	ASSETS	September 30, 2020		June 30, 2020		ASSETS
		(Unaudited)
Current assets:	Current assets:					Current assets:
Cash and cash equivalents	Cash and cash equivalents	$	118.3	$	163.7	Cash and cash equivalents	$	148.9	$	117.0
Marketable investment securities	Marketable investment securities	42.1		54.1		Marketable investment securities	27.2		33.7
Prepaid expenses	Prepaid expenses	12.5		13.8		Prepaid expenses	13.9		11.7
Inventory	Inventory	26.6		29.1		Inventory	24.6		27.1
Trade accounts receivable	Trade accounts receivable	85.1		68.1		Trade accounts receivable	94.1		89.5
Prepaid taxes	Prepaid taxes	107.9		0		Prepaid taxes	18.1		108.4
Other receivables	Other receivables	2.0		2.9		Other receivables	2.4		2.0
Total current assets	Total current assets	394.5		331.7		Total current assets	329.2		389.4
Property, plant and equipment, net	Property, plant and equipment, net	36.7		37.0		Property, plant and equipment, net	45.1		40.7
Operating lease right-of-use assets	Operating lease right-of-use assets	62.7		66.0		Operating lease right-of-use assets	58.9		59.7
Long-term marketable investment securities	Long-term marketable investment securities	30.2		37.0		Long-term marketable investment securities	11.9		21.0
Intangibles, net	Intangibles, net	590.9		605.3		Intangibles, net	559.9		576.5
Goodwill	Goodwill	328.3		327.6		Goodwill	328.3		329.2
Other assets	Other assets	1.2		0		Other assets	3.6		2.3
Total assets	Total assets	$	1,444.5	$	1,404.6	Total assets	$	1,336.9	$	1,418.8
LIABILITIES AND STOCKHOLDERS' EQUITY	LIABILITIES AND STOCKHOLDERS' EQUITY					LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:	Current liabilities:					Current liabilities:
Accounts payable	Accounts payable	$	19.1	$	21.7	Accounts payable	$	20.8	$	20.5
Accrued liabilities	Accrued liabilities	65.4		75.9		Accrued liabilities	83.1		79.1
Current maturities of operating lease liabilities	Current maturities of operating lease liabilities	13.6		13.5		Current maturities of operating lease liabilities	14.0		13.6
Short-term contingent consideration		3.3		3.1
Deferred revenue	Deferred revenue	32.3		32.8		Deferred revenue	31.1		32.7
Total current liabilities	Total current liabilities	133.7		147.0		Total current liabilities	149.0		145.9
Unrecognized tax benefits	Unrecognized tax benefits	37.4		23.5		Unrecognized tax benefits	30.8		30.5
Long-term deferred taxes	Long-term deferred taxes	75.3		26.6		Long-term deferred taxes	59.2		71.3
Long-term debt	Long-term debt	224.6		224.4		Long-term debt	154.0		224.8
Noncurrent operating lease liabilities	Noncurrent operating lease liabilities	53.5		56.9		Noncurrent operating lease liabilities	49.4		50.6
Other long-term liabilities	Other long-term liabilities	10.7		8.0		Other long-term liabilities	19.3		14.7
Total liabilities	Total liabilities	535.2		486.4		Total liabilities	461.7		537.8
Commitments and contingencies	Commitments and contingencies					Commitments and contingencies	0		0
Stockholders’ equity:	Stockholders’ equity:					Stockholders’ equity:
Common stock, 75.2 and 74.7 shares outstanding at September 30, 2020 and June 30, 2020 respectively		0.8		0.7
Common stock, 76.7 and 75.4 shares outstanding at March 31, 2021 and December 31, 2020, respectively						Common stock, 76.7 and 75.4 shares outstanding at March 31, 2021 and December 31, 2020, respectively	0.8		0.8
Additional paid-in capital	Additional paid-in capital	1,101.2		1,096.6		Additional paid-in capital	1,144.5		1,109.5
Accumulated other comprehensive loss	Accumulated other comprehensive loss	(3.6)		(5.2)		Accumulated other comprehensive loss	(3.6)		(2.3)
Accumulated deficit	Accumulated deficit	(189.1)		(173.9)		Accumulated deficit	(266.5)		(227.0)
Total Myriad Genetics, Inc. stockholders’ equity	Total Myriad Genetics, Inc. stockholders’ equity	909.3		918.2		Total Myriad Genetics, Inc. stockholders’ equity	875.2		881.0
Non-controlling interest	Non-controlling interest	0		0		Non-controlling interest	0		0
Total stockholders' equity	Total stockholders' equity	909.3		918.2		Total stockholders' equity	875.2		881.0
Total liabilities and stockholders’ equity	Total liabilities and stockholders’ equity	$	1,444.5	$	1,404.6	Total liabilities and stockholders’ equity	$	1,336.9	$	1,418.8

See accompanying notes to condensed consolidated financial statements.

Table of ~~Conten~~t sContents

MYRIAD GENETICS, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Operations ~~(Unaudited)~~(unaudited)

(Inin millions, except per share amounts)


		Three months ended September 30,					Three Months Ended March 31,
		2020		2019			2021		2020
Molecular diagnostic testing	Molecular diagnostic testing	$	135.7	$	172.0	Molecular diagnostic testing	$	159.6	$	150.5
Pharmaceutical and clinical services	Pharmaceutical and clinical services	9.5		14.3		Pharmaceutical and clinical services	13.5		13.5
Total revenue	Total revenue	145.2		186.3		Total revenue	173.1		164.0
Costs and expenses:	Costs and expenses:					Costs and expenses:
Cost of molecular diagnostic testing	Cost of molecular diagnostic testing	39.9		41.2		Cost of molecular diagnostic testing	44.1		43.1
Cost of pharmaceutical and clinical services	Cost of pharmaceutical and clinical services	4.3		8.5		Cost of pharmaceutical and clinical services	6.2		7.0
Research and development expense	Research and development expense	17.6		21.3		Research and development expense	23.1		19.7
Change in the fair value of contingent consideration	Change in the fair value of contingent consideration	(1.1)		0.7		Change in the fair value of contingent consideration	0.9		(3.4)
Selling, general, and administrative expense	Selling, general, and administrative expense	124.1		135.5		Selling, general, and administrative expense	145.5		132.9
Goodwill and intangible asset impairment charges						Goodwill and intangible asset impairment charges	0		98.4
Total costs and expenses	Total costs and expenses	184.8		207.2		Total costs and expenses	219.8		297.7
Operating loss	Operating loss	(39.6)		(20.9)		Operating loss	(46.7)		(133.7)
Other income (expense):	Other income (expense):					Other income (expense):
Interest income	Interest income	0.4		0.9		Interest income	0.2		0.8
Interest expense	Interest expense	(2.9)		(2.9)		Interest expense	(3.0)		(2.3)
Other	Other	(1.6)		0.6		Other	(0.1)		4.1
Total other expense, net		(4.1)		(1.4)
Total other income (expense), net						Total other income (expense), net	(2.9)		2.6
Loss before income tax	Loss before income tax	(43.7)		(22.3)		Loss before income tax	(49.6)		(131.1)
Income tax benefit	Income tax benefit	(28.5)		(1.7)		Income tax benefit	(10.1)		(15.9)
Net loss	Net loss	(15.2)		(20.6)		Net loss	(39.5)		(115.2)
Net loss attributable to non-controlling interest	Net loss attributable to non-controlling interest	0		0		Net loss attributable to non-controlling interest	0		0
Net loss attributable to Myriad Genetics, Inc. stockholders	Net loss attributable to Myriad Genetics, Inc. stockholders	$	(15.2)	$	(20.6)	Net loss attributable to Myriad Genetics, Inc. stockholders	$	(39.5)	$	(115.2)
Net loss per share:	Net loss per share:					Net loss per share:
Basic and diluted	Basic and diluted	$	(0.20)	$	(0.28)	Basic and diluted	$	(0.52)	$	(1.55)
Weighted average shares outstanding:	Weighted average shares outstanding:					Weighted average shares outstanding:
Basic and diluted	Basic and diluted	74.7		73.7		Basic and diluted	76.0		74.5

See accompanying notes to condensed consolidated financial statements.

Table of ~~Conten~~t sContents

MYRIAD GENETICS, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Loss ~~(Unaudited)~~(unaudited)

(Inin millions)


		Three months ended September 30,					Three Months Ended March 31,
		2020		2019			2021		2020
Net loss attributable to Myriad Genetics, Inc. stockholders	Net loss attributable to Myriad Genetics, Inc. stockholders	$	(15.2)	$	(20.6)	Net loss attributable to Myriad Genetics, Inc. stockholders	$	(39.5)	$	(115.2)
Unrealized loss on available-for-sale debt securities, net of tax	Unrealized loss on available-for-sale debt securities, net of tax	(0.2)		0		Unrealized loss on available-for-sale debt securities, net of tax	(0.2)		(0.1)
Change in foreign currency translation adjustment, net of tax	Change in foreign currency translation adjustment, net of tax	1.8		(2.2)		Change in foreign currency translation adjustment, net of tax	(1.1)		(2.5)
Comprehensive loss	Comprehensive loss	(13.6)		(22.8)		Comprehensive loss	(40.8)		(117.8)
Comprehensive loss attributable to non-controlling interest	Comprehensive loss attributable to non-controlling interest	0		0		Comprehensive loss attributable to non-controlling interest	0		0
Comprehensive loss attributable to Myriad Genetics, Inc. shareholders		$	(13.6)	$	(22.8)
Comprehensive loss attributable to Myriad Genetics, Inc. stockholders						Comprehensive loss attributable to Myriad Genetics, Inc. stockholders	$	(40.8)	$	(117.8)

See accompanying notes to condensed consolidated financial statements.

Table of ~~Conten~~t sContents

MYRIAD GENETICS, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Stockholders’ Equity

(Inin millions)


		Common stock		Additional paid-in capital		Accumulated other comprehensive loss		Retained earnings (accumulated deficit)		Myriad Genetics, Inc. Stockholders’ equity			Common stock		Additional paid-in capital		Accumulated other comprehensive loss		Accumulated deficit		Non-Controlling Interest		Myriad Genetics, Inc. Stockholders’ equity
BALANCES AT JUNE 30, 2019		$	0.7	$	1,068.0	$	(5.4)	$	25.6	$	1,088.9
BALANCES AT DECEMBER 31, 2019												BALANCES AT DECEMBER 31, 2019	$	0.7	$	1,085.1	$	(5.3)	$	(3.3)	$	0.1	$	1,077.3
Issuance of common stock under share-based compensation plans, net of shares exchanged for withholding tax												Issuance of common stock under share-based compensation plans, net of shares exchanged for withholding tax	—		0.2		—		—		—		0.2
Share-based payment expense												Share-based payment expense	—		7.5		—		—		—		7.5
Non-controlling interest												Non-controlling interest	—		—		—		—		(0.1)		(0.1)
Net loss												Net loss	—		—		—		(115.2)		—		(115.2)
Reclassification out of accumulated other comprehensive loss upon the deconsolidation of a subsidiary												Reclassification out of accumulated other comprehensive loss upon the deconsolidation of a subsidiary	—		—		0.1		—		—		0.1
Other comprehensive loss, net of tax												Other comprehensive loss, net of tax	—		—		(2.6)		—		—		(2.6)
BALANCES AT MARCH 31, 2020												BALANCES AT MARCH 31, 2020	$	0.7	$	1,092.8	$	(7.8)	$	(118.5)	$	0	$	967.2

BALANCES AT DECEMBER 31, 2020												BALANCES AT DECEMBER 31, 2020	$	0.8	$	1,109.5	$	(2.3)	$	(227.0)	$	0	$	881.0
Issuance of common stock under share-based compensation plans, net of shares exchanged for withholding tax	Issuance of common stock under share-based compensation plans, net of shares exchanged for withholding tax	—		(0.5)		—		—		(0.5)		Issuance of common stock under share-based compensation plans, net of shares exchanged for withholding tax	0		26.0		—		—		—		26.0
Share-based payment expense	Share-based payment expense	—		8.8		—		—		8.8		Share-based payment expense	—		9.0		—		—		—		9.0
Net loss	Net loss	—		—		—		(20.6)		(20.6)		Net loss	—		—		—		(39.5)		—		(39.5)
Other comprehensive loss, net of tax	Other comprehensive loss, net of tax	—		—		(2.1)		—		(2.1)		Other comprehensive loss, net of tax	—		—		(1.3)		—		—		(1.3)
BALANCES AT SEPTEMBER 30, 2019		$	0.7	$	1,076.3	$	(7.5)	$	5.0	$	1,074.5

BALANCES AT JUNE 30, 2020		$	0.7	$	1,096.6	$	(5.2)	$	(173.9)	$	918.2
Issuance of common stock under share-based compensation plans, net of shares exchanged for withholding tax		0.1		(3.8)		—		—		(3.7)
Share-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
BALANCES AT MARCH 31, 2021												BALANCES AT MARCH 31, 2021	$	0.8	$	1,144.5	$	(3.6)	$	(266.5)	$	0	$	875.2

See accompanying notes to consolidated financial statements.

Table of ~~Conten~~t sContents

MYRIAD GENETICS, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows ~~(Unaudited)~~(unaudited)

(Inin millions)


		Three months ended September 30,					Three Months Ended March 31,
		2020		2019			2021		2020
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	$	(15.2)	$	(20.6)	Net loss attributable to Myriad Genetics, Inc. stockholders	$	(39.5)	$	(115.2)
Adjustments to reconcile net loss to net cash provided by operating activities:	Adjustments to reconcile net loss to net cash provided by operating activities:					Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	Depreciation and amortization	17.7		18.2		Depreciation and amortization	18.4		17.9
Non-cash interest expense	Non-cash interest expense	0.2		0.1		Non-cash interest expense	0.5		0.1
Non-cash lease expense	Non-cash lease expense	3.3		3.2		Non-cash lease expense	3.5		3.0
Loss (gain) on disposition of assets		0.1		(0.1)
Gain on deconsolidation of subsidiary						Gain on deconsolidation of subsidiary	0		(1.0)
Gain on disposition of assets						Gain on disposition of assets	(0.3)		(0.1)
Share-based compensation expense	Share-based compensation expense	8.4		8.8		Share-based compensation expense	9.0		7.5
Deferred income taxes	Deferred income taxes	48.4		(5.1)		Deferred income taxes	(11.8)		(16.0)
Unrecognized tax benefits	Unrecognized tax benefits	13.9		0.4		Unrecognized tax benefits	0.3		(0.1)
Impairment of goodwill and intangible assets						Impairment of goodwill and intangible assets	0		98.4
Change in fair value of contingent consideration	Change in fair value of contingent consideration	(1.1)		0.7		Change in fair value of contingent consideration	0.9		(3.4)
Changes in assets and liabilities:	Changes in assets and liabilities:					Changes in assets and liabilities:
Prepaid expenses	Prepaid expenses	1.2		2.6		Prepaid expenses	(2.1)		3.6
Trade accounts receivable	Trade accounts receivable	(17.0)		16.7		Trade accounts receivable	(4.7)		15.9
Other receivables	Other receivables	0.9		(0.1)		Other receivables	(0.4)		1.2
Inventory	Inventory	2.6		3.1		Inventory	2.4		(2.6)
Prepaid taxes	Prepaid taxes	(107.9)		2.1		Prepaid taxes	90.3		(0.7)
Other assets	Other assets	(1.2)		0		Other assets	(1.2)		0
Accounts payable	Accounts payable	(3.2)		(9.3)		Accounts payable	0.3		9.2
Accrued liabilities	Accrued liabilities	(9.8)		(4.9)		Accrued liabilities	7.8		(1.1)
Deferred revenue	Deferred revenue	(0.6)		0		Deferred revenue	(1.6)		0.2
Net cash (used in) provided by operating activities		(59.3)		15.8
Net cash provided by operating activities						Net cash provided by operating activities	71.8		16.8
CASH FLOWS FROM INVESTING ACTIVITIES	CASH FLOWS FROM INVESTING ACTIVITIES					CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures	Capital expenditures	(1.5)		(1.4)		Capital expenditures	(7.1)		(3.0)
Proceeds from sale of subsidiary						Proceeds from sale of subsidiary	0		21.3
Purchases of marketable investment securities	Purchases of marketable investment securities	0		(23.1)		Purchases of marketable investment securities	0		(15.8)
Proceeds from maturities and sales of marketable investment securities	Proceeds from maturities and sales of marketable investment securities	18.6		17.4		Proceeds from maturities and sales of marketable investment securities	15.3		20.7
Net cash provided by (used in) investing activities		17.1		(7.1)
Net cash provided by investing activities						Net cash provided by investing activities	8.2		23.2
CASH FLOWS FROM FINANCING ACTIVITIES:	CASH FLOWS FROM FINANCING ACTIVITIES:					CASH FLOWS FROM FINANCING ACTIVITIES:
Payment for tax withholding for common stock issued under share-based compensation plans		(3.8)		(0.4)
Proceeds from common stock issued under share-based compensation plans						Proceeds from common stock issued under share-based compensation plans	26.5		0.3
Payment of tax withheld for common stock issued under share-based compensation plans						Payment of tax withheld for common stock issued under share-based compensation plans	(0.5)		(0.1)
Payment of contingent consideration recognized at acquisition	Payment of contingent consideration recognized at acquisition	(0.1)		(3.3)		Payment of contingent consideration recognized at acquisition	(3.3)		0
Fees associated with refinancing of revolving credit facility						Fees associated with refinancing of revolving credit facility	(1.2)		0
Repayment of revolving credit facility	Repayment of revolving credit facility	0		(8.6)		Repayment of revolving credit facility	(70.0)		0
Net cash used in financing activities		(3.9)		(12.3)
Net cash provided by (used in) financing activities						Net cash provided by (used in) financing activities	(48.5)		0.2
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	0.4		(1.9)
Net decrease in cash and cash equivalents		(45.4)		(3.3)
Change in cash and cash equivalents classified as held for sale						Change in cash and cash equivalents classified as held for sale	0		1.5
Net increase in cash and cash equivalents						Net increase in cash and cash equivalents	31.9		39.8
Cash and cash equivalents at beginning of the period	Cash and cash equivalents at beginning of the period	163.7		93.2		Cash and cash equivalents at beginning of the period	117.0		81.2
Cash and cash equivalents at end of the period	Cash and cash equivalents at end of the period	$	118.3	$	89.9	Cash and cash equivalents at end of the period	$	148.9	$	121.0

See accompanying notes to condensed consolidated financial statements.

Table of ~~Conten~~t sContents

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

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

~~(1)~~1.BASIS OF PRESENTATION

Myriad Genetics, Inc. and subsidiaries (collectively, the “Company” or “Myriad”) is a leading personalized precision medicine company acting as a trusted advisor to transform patient lives through molecular diagnostics. The Company employs a number of proprietary technologies, including DNA, RNA and protein analysis, that help it to understand the genetic basis of human disease and the role that genes and their related proteins may play in the onset and progression of disease. The Company uses this information to guide the development of molecular diagnostic and companion diagnostic tests that are designed to assess an individual’s risk for developing disease later in life (predictive medicine), identify a patient’s likelihood of responding to drug therapy and guide a patient’s dosing to ensure optimal treatment (personalized medicine), or assess a patient’s risk of disease progression and disease recurrence (prognostic medicine). The Company generates revenue by performing molecular diagnostic tests as well as by providing pharmaceutical and clinical services to the pharmaceutical and biotechnology industries and medical research institutions utilizing its multiplexed immunoassay technology. The Company’s corporate headquarters are located in Salt Lake City, Utah.

The accompanying condensed consolidated financial statements for ~~Myriad Genetics, Inc. and subsidiaries (the “Company” or “Myriad”)~~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 ~~Annual~~Transition Report on Form 10-K for the ~~fiscal year~~transition period ended ~~June 30,~~December 31, 2020.

The preparation of financial statements in conformity with ~~U.S.~~ 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 months ended ~~September 30, 2020~~March 31, 2021 may not necessarily be indicative of results to be expected for any other interim period or for the full year.

The ~~full impact~~Company has historically experienced seasonality in its testing business. The quarter ending March 31 is typically negatively impacted by the annual reset of patient deductibles. Additionally, the volume of testing is negatively impacted by the summer season, which is generally reflected in the quarter ending June 30. The quarter ending December 31 is generally strong as the Company sees an increase in volumes from patients who have met their annual insurance deductible.

Due to the COVID-19 ~~outbreak~~global pandemic (“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 by COVID-19. As such, the Company’s year over year results may not be comparable. Management continues to ~~evolve and its future impact remains highly uncertain and unpredictable. As such, it is uncertain as to~~monitor the ~~full magnitude~~impacts of ~~the effect that the pandemic will have~~COVID-19 on the ~~Company's financial condition, liquidity, and future results of operations. Management is actively monitoring the impact of the global situation on the Company's~~Company’s financial condition, liquidity, operations, suppliers, industry, and workforce. Given the daily evaluation of ~~the~~ COVID-19 ~~outbreak~~ and the global responses to curb its spread, the Company is not able to estimate the effects of the COVID-19 ~~outbreak~~ on ~~its~~ results of operations, financial condition, or liquidity for future periods.

We have historically experienced seasonality in our testing business. The volume of testing is negatively impacted by the summer season, which is generally reflected in the quarter ended June 30. The quarter ending December 31 is generally strong as we see an increase in volumes from patients who have met their annual insurance deductible. Conversely, the quarter ending March 31 is typically negatively impacted by the annual reset of patient deductibles. Due to the global pandemic, we cannot predict if seasonality will follow the same pattern as in prior years.

Reclassifications

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

Recent Accounting Pronouncements

Recently Adopted Standards

In June 2016, the Financial Accounting Standards Board (the "FASB") issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326) (“ASU 2016-13”) which introduces new guidance for the accounting for credit losses on certain instruments within its scope. ASU 2016-13 introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. For trade receivables, the Company is required to use a forward-looking expected loss model rather than the incurred loss model for recognizing credit losses, which reflects losses that are probable. Credit losses relating to available-for-sale debt securities are also recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. On July 1, 2020, the Company adopted ASU 2016-13 under the modified retrospective approach by initially applying ASU 2016-13 at the adoption date, rather than at the beginning of the earliest comparative period presented. This guidance was adopted with no material impact to the Company's consolidated financial statements.

In August 2018, the FASB issued ASU 2018-15, Intangibles – Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (“ASU 2018-15”). ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software, including hosting arrangements that include an internal-use

~~Table of Conten~~t s

software license. On July 1, 2020, the Company adopted ASU 2018-15 on a prospective basis with no material impact to the Company's consolidated financial statements as of September 30, 2020. The amounts capitalized may be material in future periods; implementation costs incurred in cloud computing arrangements are capitalized as part of the other assets financial statement line item in the consolidated balance sheets.

~~Standards Effective in Future Years and Not Yet Adopted~~

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes ("(“ASU ~~2019-12"~~2019-12”). ASC 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. ~~The Company is currently evaluating~~This guidance was adopted with no material impact to the ~~impact this new standard will have on the consolidated financial statements.~~Company's Condensed Consolidated Financial Statements.

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2.REVENUE

Myriad generates revenue by performing molecular diagnostic testing and pharmaceutical services. The Company previously provided clinical services until selling Privatklinik Dr. Robert Schindlbeck GmbH & Co. KG (the ~~"Clinic"~~“Clinic”) in February 2020. Revenue from the sale of molecular diagnostic tests and pharmaceutical and clinical services is recorded at the estimated amount of consideration to be received. The Company has determined that the communication of test results or the completion of clinical and pharmaceutical services indicates transfer of control for revenue recognition purposes.

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


		Three months ended September 30,													Three Months Ended March 31,
		2020						2019							2021						2020
(In millions)		U.S.		RoW		Total		U.S.		RoW		Total
(in millions)														(in millions)	U.S.		RoW		Total		U.S.		RoW		Total
Molecular diagnostic revenues:	Molecular diagnostic revenues:													Molecular diagnostic revenues:
Hereditary Cancer Testing	Hereditary Cancer Testing	$	72.1	$	8.5	$	80.6	$	100.6	$	3.9	$	104.5	Hereditary Cancer Testing	$	65.1	$	11.0	$	76.1	$	81.3	$	3.9	$	85.2
Prenatal	Prenatal	16.4		0.1		16.5		23.5		0		23.5		Prenatal	23.6		0.1		23.7		20.2		0.1		20.3
GeneSight	GeneSight	11.9		0		11.9		22.7		0		22.7		GeneSight	17.6		0		17.6		20.4		0		20.4
Vectra	Vectra	9.1		0		9.1		11.0		0		11.0		Vectra	10.7		0		10.7		10.5		0		10.5
myChoice CDx	myChoice CDx	7.6		0.2		7.8		1.3		0		1.3		myChoice CDx	4.8		3.6		8.4		3.2		0.1		3.3
Prolaris	Prolaris	6.4		0		6.4		6.5		0		6.5		Prolaris	18.5		0		18.5		6.8		0		6.8
EndoPredict	EndoPredict	0.4		2.4		2.8		0.5		1.8		2.3		EndoPredict	0.9		3.2		4.1		0.6		2.9		3.5
Other	Other	0.6		0		0.6		0.1		0.1		0.2		Other	0		0.5		0.5		0.4		0.1		0.5
Total molecular diagnostic revenue	Total molecular diagnostic revenue	124.5		11.2		135.7		166.2		5.8		172.0		Total molecular diagnostic revenue	141.2		18.4		159.6		143.4		7.1		150.5
Pharmaceutical and clinical service revenue	Pharmaceutical and clinical service revenue	9.5		0		9.5		8.5		5.9		14.3		Pharmaceutical and clinical service revenue	13.5		0		13.5		9.6		3.9		13.5
Total revenue	Total revenue	$	134.0	$	11.2	$	145.2	$	174.7	$	11.7	$	186.3	Total revenue	$	154.7	$	18.4	$	173.1	$	153.0	$	11.0	$	164.0

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~~Company’s performance of its contractual obligations. When this occurs, the Company records a contract liability as deferred revenue. 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 advance~~Repayment of the advanced Medicare payments ~~are included~~began in ~~the beginning and ending balance of deferred revenue.~~April 2021. A reconciliation of the beginning and ending balances of deferred revenue is shown in the table below:

~~Table of Conten~~t s


		Three months ended September 30,					Three Months Ended March 31,
		2020		2019
(in millions)						(in millions)	2021		2020
Deferred revenue - beginning balance	Deferred revenue - beginning balance	$	32.8	$	2.2	Deferred revenue - beginning balance	$	32.7	$	3.6
Revenue recognized	Revenue recognized	(2.3)		(0.4)		Revenue recognized	(6.7)		(1.3)
Prepayments	Prepayments	1.8		0.3		Prepayments	5.1		1.5
Deferred revenue - ending balance	Deferred revenue - ending balance	$	32.3	$	2.1	Deferred revenue - ending balance	$	31.1	$	3.8

In accordance with ~~ASU 2014-09,~~ASC Topic 606, Revenue from Contracts with Customers (“Topic 606”), the Company has elected not to disclose the aggregate amount of the transaction price allocated to remaining performance obligations for its contracts that are one year or less, as the revenue is expected to be recognized within the next year. Furthermore, the Company has elected not to disclose the aggregate amount of the transaction price allocated to remaining performance obligations for its agreements wherein the Company’s right to payment is in an amount that directly corresponds with the value of Company’s performance to date. However, the Company periodically enters into arrangements with customers to provide diagnostic testing and/or pharmaceutical ~~and clinical~~ services that may have terms longer than one year and include multiple performance obligations. As of ~~September 30, 2020,~~March 31, 2021, the aggregate amount of the transaction price of such contracts that is allocated to the remaining performance obligations is ~~$2.8.~~$11.2 million.

~~The Company may provide discounts to its customers.~~

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In determining the transaction price, Myriad 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. ~~The Company applies the expected value method for sales where the Company has a large number~~An estimate of ~~contracts with similar characteristics.~~

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 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 ~~Company excludes~~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 the measurement of transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the Company from a customer. for example, sales tax, value added tax, etc.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~~Accrued liabilities onin the ~~balance sheet~~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 ~~consolidated statements~~Condensed Consolidated Statements of ~~operations~~Operations and ~~comprehensive loss. As of September 30, 2020, the Company recorded a $2.2 accrued liability and corresponding reduction in revenues for future refund of payments.~~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. As a result of this new information, the Company updates our estimate of the amounts to be recognized for previously delivered tests, the impact of which was not material to our consolidated statements of operations forDuring the three months ended ~~September 30, 2020.~~March 31, 2021, the Company recognized $5.3 million in revenue, which resulted in a $0.07 impact to earnings per share, 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, 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, 0 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.

Concentration of Credit Risk

Financial instruments that potentially subject usthe 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 ~~with~~ 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 represents greater than 10% of its revenues. Revenues received from Medicare represented approximately ~~16%~~19% and ~~14%~~16% of total revenue for the three months ended ~~September 30,~~March 31, 2021 and 2020, ~~and 2019,~~ respectively. 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, 2020~~March 31, 2021 or ~~2019.~~December 31, 2020. The Company does not require collateral from its customers.

Table of ~~Conten~~t sContents

~~(3)~~3.MARKETABLE INVESTMENT SECURITIES

The Company has classified its debt investment securities as available-for-sale securities. These securities are carried at estimated fair value with unrealized holding gains and losses, net of the related tax effect, included in accumulated other comprehensive loss in stockholders’ equity until realized. Gains and losses on investment security transactions are reported on the specific-identification method. Dividend and interest income are recognized when earned. The Company’s cash equivalents consist of short-term, highly liquid investments that are readily convertible to known amounts of cash. 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, 2020~~March 31, 2021 and ~~June 30,~~December 31, 2020 were as follows:


		Amortized cost		Gross unrealized holding gains		Gross unrealized holding losses		Estimated fair value
At September 30, 2020:
(in millions)										(in millions)	Amortized cost		Gross unrealized holding gains		Gross unrealized holding losses		Estimated fair value
March 31, 2021:										March 31, 2021:
Cash and cash equivalents:	Cash and cash equivalents:									Cash and cash equivalents:
Cash	Cash	$	68.3	$	—	$	—	$	68.3	Cash	$	65.9	$	—	$	—	$	65.9
Cash equivalents	Cash equivalents	50.0		—		—		$	50.0	Cash equivalents	83.0		—		—		83.0
Total cash and cash equivalents	Total cash and cash equivalents	118.3		—		—		118.3		Total cash and cash equivalents	148.9		—		—		148.9
Available-for-sale:	Available-for-sale:									Available-for-sale:
Corporate bonds and notes	Corporate bonds and notes	40.5		0.6		0		41.1		Corporate bonds and notes	22.7		0.4		0		23.1
Municipal bonds	Municipal bonds	12.6		0.2		0		12.8		Municipal bonds	8.2		0.1		0		8.3
Federal agency issues	Federal agency issues	4.0		0.1		0		4.1		Federal agency issues	4.0		0		0		4.0
US government securities	US government securities	14.2		0.1		0		14.3		US government securities	3.7		0		0		3.7
Total	Total	$	189.6	$	1.0	$	0	$	190.6	Total	$	187.5	$	0.5	$	0	$	188.0

Amortized
cost Gross
unrealized
holding
gains Gross
unrealized
holding
losses Estimated
fair value
At June 30, 2020:
Cash and cash equivalents:
Cash $ 132.8 $ — $ — $ 132.8
Cash equivalents 30.9 — — 30.9
Total cash and cash equivalents 163.7 — — 163.7
Available-for-sale:
Corporate bonds and notes 50.1 0.8 0 50.9
Municipal bonds 17.8 0.2 0 18.0
Federal agency issues 5.5 0.1 0 5.6
US government securities 16.4 0.2 0 16.6
Total $ 253.5 $ 1.3 $ 0 $ 254.8

In accordance with the adoption of ASC 2016-13, the Company assesses any unrealized loss positions for available-for-sale debt securities for which an allowance for credit losses has not been recorded. The aggregate amount of unrealized losses of these securities was not significant, and the impact of the securities in a continuous loss position to the condensed consolidated statements of operations and comprehensive loss were not material as of September 30, 2020.


(in millions)	Amortized cost		Gross unrealized holding gains		Gross unrealized holding losses		Estimated fair value
December 31, 2020:
Cash and cash equivalents:
Cash	$	47.9	$	—	$	—	$	47.9
Cash equivalents	69.1		—		—		69.1
Total cash and cash equivalents	117.0		—		—		117.0
Available-for-sale:
Corporate bonds and notes	28.8		0.5		0		29.3
Municipal bonds	9.4		0.2		0		9.6
Federal agency issues	4.0		0		0		4.0
US government securities	11.7		0.1		0		11.8
Total	$	170.9	$	0.8	$	0	$	171.7

~~Table of Conten~~t s

Cash, cash equivalents, and maturities of debt securities classified as available-for-sale securities ~~are~~were as follows at ~~September 30, 2020:~~March 31, 2021:


		Amortized cost		Estimated fair value
(in millions)						(in millions)	Amortized cost		Estimated fair value
Cash	Cash	$	68.3	$	68.3	Cash	$	65.9	$	65.9
Cash equivalents	Cash equivalents	50.0		50.0		Cash equivalents	83.0		83.0
Available-for-sale:	Available-for-sale:					Available-for-sale:
Due within one year	Due within one year	41.8		42.1		Due within one year	26.9		27.2
Due after one year through five years	Due after one year through five years	29.5		30.2		Due after one year through five years	11.7		11.9
Due after five years	Due after five years	0		0		Due after five years	0		0
Total	Total	$	189.6	$	190.6	Total	$	187.5	$	188.0

There were 0 debt securities classified as available-for-sale in a gross unrealized loss position as of March 31, 2021 or December 31, 2020.

~~(4)~~

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

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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. The fair value of contingent consideration related to the Sividon Diagnostics GmbH ("Sividon") acquisition in fiscal year 2016 as well as long-term debt are categorized as Level 3 liabilities, as the measurement amount is based primarily on significant inputs not observable in the market. 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 ~~9.25~~14.3 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 a component of Other long-term ~~and short-term contingent consideration~~liabilities in the Company’s ~~consolidated balance sheets.~~Condensed Consolidated Balance Sheets. Changes to ~~the earn-out~~contingent consideration liabilities are reflected in ~~change~~Change in the fair value of contingent consideration in ~~our consolidated statements~~the Company’s Condensed Consolidated Statements of ~~operations.~~Operations. Changes to the unobservable inputs could have a material impact on the Company’s financial statements.

The fair value of ~~our~~the Company’s long-term debt, which ~~we consider~~it considers a Level 3 measurement, is estimated using discounted cash flow analyses, based on the Company’s current estimated incremental borrowing rates for similar borrowing arrangements. The fair value of the Company’s long-term debt is estimated to be ~~$226.5~~$153.6 million at ~~September 30, 2020.~~March 31, 2021.

~~Table of Conten~~t s

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


		Level 1		Level 2		Level 3		Total
September 30, 2020
(in millions)										(in millions)	Level 1		Level 2		Level 3		Total
March 31, 2021										March 31, 2021
Money market funds (a)	Money market funds (a)	$	50.0	$	0	$	0	$	50.0	Money market funds (a)	$	83.0	$	0	$	0	$	83.0
Corporate bonds and notes	Corporate bonds and notes	0		41.1		0		41.1		Corporate bonds and notes	0		23.1		0		23.1
Municipal bonds	Municipal bonds	0		12.8		0		12.8		Municipal bonds	0		8.3		0		8.3
Federal agency issues	Federal agency issues	0		4.1		0		4.1		Federal agency issues	0		4.0		0		4.0
US government securities	US government securities	0		14.3		0		14.3		US government securities	0		3.7		0		3.7
Contingent consideration	Contingent consideration	0		0		(5.9)		(5.9)		Contingent consideration	0		0		(8.0)		(8.0)
Total	Total	$	50.0	$	72.3	$	(5.9)	$	116.4	Total	$	83.0	$	39.1	$	(8.0)	$	114.1

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

Level 1 Level 2 Level 3 Total
June 30, 2020
Money market funds (a) $ 30.9 $ 0 $ 0 $ 30.9
Corporate bonds and notes 0 50.9 0 50.9
Municipal bonds 0 18.0 0 18.0
Federal agency issues 0 5.6 0 5.6
US government securities 0 16.6 0 16.6
Contingent consideration 0 0 (6.8) (6.8)
Total $ 30.9 $ 91.1 $ (6.8) $ 115.2

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(in millions)	Level 1		Level 2		Level 3		Total
December 31, 2020
Money market funds (a)	$	69.1	$	0	$	0	$	69.1
Corporate bonds and notes	0		29.3		0		29.3
Municipal bonds	0		9.6		0		9.6
Federal agency issues	0		4.0		0		4.0
US government securities	0		11.8		0		11.8
Contingent consideration	0		0		(10.9)		(10.9)
Total	$	69.1	$	54.7	$	(10.9)	$	112.9

(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~~Amount
Balance ~~June 30,~~December 31, 2020	$	~~6.8~~10.9
Payment of contingent consideration	~~(0.1)~~(3.3)
Change in fair value recognized in the income statement	~~(1.1)~~0.9
Translation adjustments recognized in other comprehensive loss	~~0.3~~ (0.5)
Ending balance ~~September 30, 2020~~March 31, 2021	$	~~5.9~~8.0

The fair value of contingent consideration for the three months ended September 30, 2020 decreased 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 acquisition.

~~(5)~~5.PROPERTY, PLANT AND EQUIPMENT, NET


		September 30, 2020		June 30, 2020
(in millions)						(in millions)	March 31, 2021		December 31, 2020
Leasehold improvements	Leasehold improvements	$	32.6	$	31.8	Leasehold improvements	$	36.8	$	35.7
Equipment	Equipment	114.1		112.1		Equipment	119.0		117.9
		146.7		143.9
Property, plant and equipment, gross						Property, plant and equipment, gross	155.8		153.6
Less accumulated depreciation	Less accumulated depreciation	(110.0)		(106.9)		Less accumulated depreciation	(110.7)		(112.9)
Property, plant and equipment, net	Property, plant and equipment, net	$	36.7	$	37.0	Property, plant and equipment, net	$	45.1	$	40.7

~~Table of Conten~~t s

Three months ended
September 30,
2020 2019
Depreciation expense $ 2.4 $ 2.9


	Three Months Ended March 31,
(in millions)	2021		2020
Depreciation expense	$	2.9	$	2.6

~~(6)~~6.GOODWILL AND INTANGIBLE ASSETS

Goodwill

The following table summarizes the changes in the carrying amount of goodwill for the three months ended ~~September 30, 2020, are as follows:~~March 31, 2021:


		Diagnostic		Other		Total
(in millions)								(in millions)	Diagnostic		Other		Total
Beginning balance	Beginning balance	$	270.7	$	56.9	$	327.6	Beginning balance	$	272.3	$	56.9	$	329.2
Translation adjustments	Translation adjustments	0.7		0		0.7		Translation adjustments	(0.9)		0		(0.9)
Ending balance	Ending balance	$	271.4	$	56.9	$	328.3	Ending balance	$	271.4	$	56.9	$	328.3

~~The Company will perform its annual goodwill impairment testing during the quarter ended December 31, 2020 as a result~~

Table of its change in fiscal year end (see Note 16). The upcoming annual assessment may result in impairment charges if there is deterioration in business conditions, negative changes in market factors, or changes in the strategic priorities of the Company and its reporting units.Contents

Intangible Assets

Intangible assets primarily consist of amortizable assets 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. The following summarizes the amounts reported as intangible assets:


		Gross Carrying Amount		Accumulated Amortization		Net
At September 30, 2020:
(in millions)								(in millions)	Gross Carrying Amount		Accumulated Amortization		Net
At March 31, 2021:								At March 31, 2021:
Purchased licenses and technologies	Purchased licenses and technologies	$	816.6	$	(232.4)	$	584.2	Purchased licenses and technologies	$	816.6	$	(263.1)	$	553.5
Customer relationships	Customer relationships	4.7		(4.4)		0.3		Customer relationships	4.7		(4.6)		0.1
Trademarks	Trademarks	3.0		(1.4)		1.6		Trademarks	3.0		(1.5)		1.5
Total amortized intangible assets	Total amortized intangible assets	824.3		(238.2)		586.1		Total amortized intangible assets	824.3		(269.2)		555.1
In-process research and development	In-process research and development	4.8		—		4.8		In-process research and development	4.8		—		4.8
Total unamortized intangible assets	Total unamortized intangible assets	4.8		—		4.8		Total unamortized intangible assets	4.8		—		4.8
Total intangible assets	Total intangible assets	$	829.1	$	(238.2)	$	590.9	Total intangible assets	$	829.1	$	(269.2)	$	559.9


		Gross Carrying Amount		Accumulated Amortization		Net
At June 30, 2020:
(in millions)								(in millions)	Gross Carrying Amount		Accumulated Amortization		Net
At December 31, 2020:								At December 31, 2020:
Purchased licenses and technologies	Purchased licenses and technologies	$	815.6	$	(217.1)	$	598.5	Purchased licenses and technologies	$	818.2	$	(248.2)	$	570.0
Customer relationships	Customer relationships	4.6		(4.2)		0.4		Customer relationships	4.7		(4.5)		0.2
Trademarks	Trademarks	3.0		(1.4)		1.6		Trademarks	3.0		(1.5)		1.5
Total amortized intangible assets	Total amortized intangible assets	823.2		(222.7)		600.5		Total amortized intangible assets	825.9		(254.2)		571.7
In-process research and development	In-process research and development	4.8		—		4.8		In-process research and development	4.8		—		4.8
Total unamortized intangible assets	Total unamortized intangible assets	4.8		—		4.8		Total unamortized intangible assets	4.8		—		4.8
Total intangible assets	Total intangible assets	$	828.0	$	(222.7)	$	605.3	Total intangible assets	$	830.7	$	(254.2)	$	576.5

~~Table of Conten~~t s

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

Three months ended
September 30,
2020 2019
Amortization of intangible assets $ 15.3 $ 15.3


	Three Months Ended March 31,
(in millions)	2021		2020
Amortization of intangible assets	$	15.5	$	15.3

~~(7)~~7.ACCRUED LIABILITIES


		September 30, 2020		June 30, 2020
(in millions)						(in millions)	March 31, 2021		December 31, 2020
Employee compensation and benefits	Employee compensation and benefits	$	47.2	$	47.4	Employee compensation and benefits	$	41.2	$	43.7
Accrued taxes payable	Accrued taxes payable	3.5		6.1		Accrued taxes payable	5.4		4.3
Recoupments payable and reserves						Recoupments payable and reserves	6.9		9.3
Short-term contingent consideration						Short-term contingent consideration	0		3.4
Other	Other	14.7		22.4		Other	29.6		18.4
Total accrued liabilities	Total accrued liabilities	$	65.4	$	75.9	Total accrued liabilities	$	83.1	$	79.1

~~(8)~~Table of Contents

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 the lenders from time to time party thereto. On July 31, 2018, the Company entered into Amendment No. 1 which effected an “amend and extend” transaction with respect to the Facility by which the maturity date thereof was extended to July 31, 2023 and the maximum aggregate principal commitment was increased from $300.0 million to ~~$350.0.~~$350.0 million. On May 1, 2020, the Company entered into Amendment No. 2, ~~(the “Amended Facility”),~~ which waived the ~~Company's~~Company’s compliance with certain financial covenants, amended compliance with certain operating covenants, and modified the interest rate and other terms during ~~the Amendment Period~~a modification period from March 31, 2020 through June 30, 2021 (the ~~"Amendment Period"~~“Modification Period”). ~~Both~~On February 22, 2021, the Company entered into Amendment No. 3 (the “Amended Facility”), which, among other things, 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.

Pursuant to the Amended Facility, the Company borrowed revolving loans in an aggregate principal amount of $300.0 with $1.8 in upfront fees and $0.3 debt issuance costs recorded as a debt discount to be amortized over the term of the Amended Facility. The Company incurred an additional $1.0 in upfront fees as a result of Amendment No. 2, which was also recorded as a debt discount that will be amortized over the term of the Amended Facility. The current balance of the net long-term debt is $224.6. There are 0 scheduled principal payments of the Amended Facility prior to its maturity date.

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. Amendment No. 2 modified 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 ~~Amendment~~Modification Period. At the end of the ~~Amendment~~Modification Period, interest rates return to the previous pricing based on a spread of ~~200~~LIBOR plus 150-250 basis points on drawn balances and an undrawn fee ranging from 25 to 45 basis points, in each case, based on the Company's leverage ratio. The LIBOR floor was also increased to 1.0% during the ~~Amendment~~Modification Period. The interest rate as of ~~September 30, 2020~~March 31, 2021 was 4.5%.

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 ~~complete~~ 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 ~~shareholders. The~~stockholders. Beginning with the quarter ended June 30, 2022, the Company must maintain specified leverage and interest ratios measured as of the end of each quarter as a financial covenant in the Amended Facility. Amendment No. 2 modified the Amended Facility's compliance with the leverage covenant and the interest coverage ratio covenant, which were waived through March 31, 2021. A minimum liquidity covenant was added for the period beginning May 1, 2020 until March 31, 2021, and a minimum EBITDA covenant was added for the quarters ~~ending~~ended December 31, 2020 and March 31, 2021. Amendment No. 2 also revised certain negative covenants of the Amended Facility during the Modification Period. Amendment ~~Period.~~No. 3 waived compliance with the leverage ratio and the interest coverage ratio covenants through the quarter ending March 31, 2022 and also lowered the minimum liquidity covenant applicable through such quarter. Amendment No. 3 also removed the minimum EBITDA covenant and 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. The Company was in compliance with all applicable financial covenants at ~~September 30, 2020. Based~~March 31, 2021.

On February 26, 2021, the Company made a $70.0 million principal repayment on the ~~continued uncertainty regarding~~Amended Facility. During the ~~impact of COVID-19 on the Company’s future operations, it is possible that~~transition period ended December 31, 2020, the Company could be in violation of certain financial covenants contained in the Amended Facility within the Amendment Period, which runs through June 30, 2021. The Company may seek waivers or amendments from the lenders in order to avoid a future potential covenant violation, in addition to taking other potential actions. If the Company were unable to comply with the covenants in the future, it could result in an increase in the rate of interest and limits on the Company's ability to incur certain additional indebtedness and it could potentially cause the loan repayment to be

~~Table of Conten~~t s

~~accelerated,~~did 0t make any of which could have a material adverse impact on the Company’s operations and liquidity. The Company has and continues to take actions to mitigate the risk of an event of default under the Amended Facility, however there is no assurance it will be successful in doing so.principal repayments.

The Amended Facility is secured by a first-lien security interest in substantially all of the assets of Myriad and certain of its domestic subsidiaries and each such domestic subsidiary of Myriad has guaranteed the repayment of the Amended Facility. Amounts outstanding under the Amended Facility ~~and Facility~~ were as follows:


		September 30, 2020		June 30, 2020
(in millions)						(in millions)	March 31, 2021		December 31, 2020
Long-term debt	Long-term debt	$	226.7	$	226.7	Long-term debt	$	156.6	$	226.7
Long-term debt discount	Long-term debt discount	(2.1)		(2.3)		Long-term debt discount	(2.6)		(1.9)
Net long-term debt	Net long-term debt	$	224.6	$	224.4	Net long-term debt	$	154.0	$	224.8

Table of Contents

~~(9)~~9.OTHER LONG-TERM LIABILITIES


		September 30, 2020		June 30, 2020
(in millions)						(in millions)	March 31, 2021		December 31, 2020
Contingent consideration	Contingent consideration	$	2.6	$	3.7	Contingent consideration	$	8.0	$	7.4
Other	Other	8.1		4.3		Other	11.3		7.3
Total other long-term liabilities	Total other long-term liabilities	$	10.7	$	8.0	Total other long-term liabilities	$	19.3	$	14.7

The Company's balance of other long-term liabilities as of ~~September 30, 2020~~March 31, 2021 and ~~June 30,~~December 31, 2020 consists of the ~~Company's~~Company’s portion of social security taxes that have been deferred under the Coronavirus Aid, Relief, and Economic Security Act (“CARES ~~Act~~Act”) that do not have to be deposited until December ~~2021~~2022, and ~~December 2022.~~leasehold improvements made to the Company’s new headquarters in Salt Lake City, Utah under a lease that has not yet commenced.

~~(10)~~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 0 preferred shares outstanding at ~~September 30, 2020.~~March 31, 2021.

The Company is authorized to issue up to 150.0 million shares of common stock, par value $0.01 per share. There were ~~75.2~~76.7 million shares issued and outstanding at ~~September 30, 2020.~~March 31, 2021.

Common shares issued and outstanding


		Three months ended September 30,	Year ended June 30,		Three Months Ended March 31,
		2020	2020
(in millions)				(in millions)	2021	2020
Beginning common stock issued and outstanding	Beginning common stock issued and outstanding	74.7	73.5	Beginning common stock issued and outstanding	75.4	74.5
Common stock issued upon exercise of options, vesting of restricted stock units and employee stock plans		0.5	1.2
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	1.3	0

Common stock issued and outstanding at end of period	Common stock issued and outstanding at end of period	75.2	74.7	Common stock issued and outstanding at end of period	76.7	74.5

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.

~~Table of Conten~~t s

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


		Three months ended September 30,			Three Months Ended March 31,
		2020	2019
(in millions)				(in millions)	2021	2020
Denominator:	Denominator:			Denominator:
Weighted-average shares outstanding used to compute basic EPS	Weighted-average shares outstanding used to compute basic EPS	74.7	73.7	Weighted-average shares outstanding used to compute basic EPS	76.0	74.5
Effect of dilutive shares	Effect of dilutive shares	0	0	Effect of dilutive shares	0	0
Weighted-average shares outstanding and dilutive securities used to compute diluted EPS	Weighted-average shares outstanding and dilutive securities used to compute diluted EPS	74.7	73.7	Weighted-average shares outstanding and dilutive securities used to compute diluted EPS	76.0	74.5

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 common shares, which may be dilutive to future diluted earnings per share, are as follows:

Three months ended
September 30,
2020 2019
Anti-dilutive options and RSUs excluded from EPS computation 7.3 1.7


	Three Months Ended March 31,
(in millions)	2021	2020
Anti-dilutive options and RSUs excluded from EPS computation	0.3	0.4

Table of Contents

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 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, 2020,~~March 31, 2021, the Company is authorized to repurchase up to $110.7 million of shares under this authorization. NaN shares were repurchased during the three months ended ~~September 30, 2020~~March 31, 2021 or ~~2019.~~2020.

~~(11)~~11.SHARE-BASED COMPENSATION

On November 30, 2017, the Company’s ~~shareholders~~stockholders approved the adoption of the 2017 Employee, Director and Consultant Equity Incentive Plan (as amended, the “2017 Plan”). ~~On November 29, 2018 and December 5, 2019, the shareholders approved amendments to the 2017 Plan increasing the shares available to grant.~~ The 2017 Plan allows the Company, under the direction of the Compensation Committee of the Board of Directors, to make grants of restricted and unrestricted stock awards to employees, consultants, and directors. Stockholders have approved annual amendments to the 2017 Plan increasing the shares available to grant. As of ~~September 30, 2020,~~March 31, 2021, the Company ~~may grant additional~~has 3.3 million shares of common stock available for grant under the 2017 Plan with respect to the 0.1 options outstanding under our 2003 Plan and 4.8 options and restricted stock units outstanding under our 2010 Plan, to the extent that those options and restricted stock units expire or are cancelled without delivery of shares of common stock.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, which were subject to the RSU, shall again be available for issuance pursuant to the 2017 Plan. To the extent awards outstanding under the Company's prior equity plans expire or are cancelled without delivery of shares of common stock, they also shall be available for issuance pursuant to the 2017 Plan.

The number of shares, terms, and vesting periods are 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 on the anniversary date of the designated day of the last week of the month in which the RSUs are granted. The number of RSUs awarded to certain ~~executive officers~~employees may be increased or reduced based on certain additional performance metrics. Options and RSUs granted to ~~our~~ non-employee directors vest in full upon 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 the date of grant, and options granted prior to that date generally expire ten years from the date of grant. In September 2014, the Company began generally issuing RSUs in lieu of stock options.

During the three months ended September 30, 2020, the Company granted stock-based awards to the Company's new President and Chief Executive Officer as an inducement material to his commencement of employment and entry into an employment agreement with the Company. The inducement awards were made in accordance with Nasdaq Stock Market rules and were not made under the Company's existing equity plans; the inducement awards are included in the tables below.

~~Table of Conten~~t s

Stock Options

A summary of the stock option activity under the Company’s equity plans ~~including the Company's~~and inducement awards, for the three months ended ~~September 30, 2020~~March 31, 2021 is as follows:


		Number of shares	Weighted average exercise price
Options outstanding at June 30, 2020		4.8	$	24.47
(number of shares in millions)					(number of shares in millions)	Number of Shares	Weighted Average Exercise Price
Options outstanding at December 31, 2020					Options outstanding at December 31, 2020	5.2	$	23.24
Options granted	Options granted	0.7	$	13.38	Options granted	0	$	0
Less:	Less:				Less:
Options exercised	Options exercised	0	$	0	Options exercised	(1.2)	$	21.83
Options canceled or expired	Options canceled or expired	(0.1)	$	16.40	Options canceled or expired	(0.1)	$	24.29
Options outstanding at September 30, 2020		5.4	$	23.19
Options exercisable at September 30, 2020		4.7	$	24.62
Options outstanding at March 31, 2021					Options outstanding at March 31, 2021	3.9	$	23.66
Options exercisable at March 31, 2021					Options exercisable at March 31, 2021	3.3	$	25.79

As of ~~September 30, 2020,~~March 31, 2021, there was ~~$5.2~~$4.0 million of total unrecognized share-based compensation expense related to ~~the inducement~~ stock options that will be recognized over a weighted-average period of ~~2.8~~2.3 years.

Table of Contents

Restricted Stock Units

A summary of the RSU activity under the Company’s equity plans ~~including the Company's~~and inducement awards, ~~and~~including RSU awards with performance metrics, for the three months ended ~~September 30, 2020~~March 31, 2021 is as follows:


		Number of shares	Weighted average grant date fair value
RSUs outstanding at June 30, 2020		2.3	$	32.50
(number of shares in millions)					(number of shares in millions)	Number of Shares	Weighted Average Grant Date Fair Value
RSUs outstanding at December 31, 2020					RSUs outstanding at December 31, 2020	3.2	$	20.56
RSUs granted	RSUs granted	0.4	$	13.24	RSUs granted	1.3	$	30.07
Less:	Less:				Less:
RSUs vested	RSUs vested	(0.8)	$	33.07	RSUs vested	0	$	0
RSUs canceled	RSUs canceled	0	$	0	RSUs canceled	(0.1)	$	25.60
RSUs outstanding at September 30, 2020		1.9	$	27.70
RSUs outstanding at March 31, 2021					RSUs outstanding at March 31, 2021	4.4	$	23.53

As of ~~September 30, 2020,~~March 31, 2021, there was ~~$44.1~~$89.5 million of total unrecognized share-based compensation expense related to RSUs that will be recognized over a weighted-average period of ~~2.5~~2.8 years.

Employee Stock Purchase Plan

The Company also has an Employee Stock Purchase Plan that was approved by ~~shareholders~~stockholders in 2012 (the “2012 Purchase Plan”), under which 2.0 million shares of common stock have been authorized. Shares are issued under the 2012 Purchase Plan twice yearly at the end of each offering period. As of ~~September 30, 2020,~~March 31, 2021, approximately ~~0.3~~0.2 million shares of common stock are available for issuance under the 2012 Purchase Plan.

Share-Based Compensation Expense

Share-based compensation expense recognized and included in the condensed consolidated statements of operations and comprehensive loss was allocated as follows:


		Three months ended September 30,					Three Months Ended March 31,
		2020		2019
(in millions)						(in millions)	2021		2020
Cost of molecular diagnostic testing	Cost of molecular diagnostic testing	$	0.3	$	0.2	Cost of molecular diagnostic testing	$	0.3	$	0.3
Cost of pharmaceutical and clinical services	Cost of pharmaceutical and clinical services	0.1		0.1		Cost of pharmaceutical and clinical services	0.1		0.1
Research and development expense	Research and development expense	1.3		1.5		Research and development expense	1.5		1.2
Selling, general, and administrative expense	Selling, general, and administrative expense	6.7		7.0		Selling, general, and administrative expense	7.1		5.9
Total share-based compensation expense	Total share-based compensation expense	$	8.4	$	8.8	Total share-based compensation expense	$	9.0	$	7.5

~~Table of Conten~~t s

~~(12)~~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. ~~Under the Tax Cuts and Jobs Act, the federal corporate tax rate is 21% for calendar year 2020.~~ 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.

Income tax benefit for the three months ended ~~September 30, 2020~~March 31, 2021 was ~~$28.5,~~$10.1 million, or approximately ~~65.2%~~20.4% of pre-tax loss compared to an income tax benefit of ~~$1.7,~~$15.9 million, or approximately ~~7.6%~~12.1% of pre-tax loss, for the three months ended ~~September 30, 2019.~~March 31, 2020. Income tax benefit for the three months ended ~~September 30, 2020~~March 31, 2021 is based on the Company’s estimated annualized effective tax rate for the ~~six-month transition period~~fiscal year ending December 31, ~~2020,~~2021, adjusted byfor discrete items recognized during the period. For the three months ended ~~September 30, 2020,~~March 31, 2021, the Company’s recognized effective tax rate differs from the U.S. federal statutory rate primarily due to ~~carrying back net operating losses due to~~disallowed executive compensation expenses, disallowed meals and entertainment expenses, and differences between the ~~CARES Act.~~

~~On March 27, 2020,~~total amount of stock compensation recognized and the ~~Coronavirus Aid, Relief, and Economic Security Act (“CARES”) was enacted. CARES impacted several provisions to the U.S.~~amount allowable for tax code that have affected our six-month transition period ending December 31, 2020, including, but not limited to, (1) NOL carry-back and carry-forward provisions, (2) deductibility of interest, (3) acceleration of corporate AMT credits, and (4) classification of qualified improvement property. As of the quarter ended September 30, 2020, the Company recognized an income tax net benefit of $20.0 related to the CARES Act, which included an increase in the uncertain tax benefit accrual of $14.3, related to carrying back net operating losses to tax years with higher corporate tax rates than the year the net operating loss originated. The Company will continue to evaluate the application of any and all provisions through the remainder of the six-month transition period ending December 31, 2020.deductions.

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~~State of New Jersey for the fiscal years June 30, 2013 through 2017; the ~~state~~State of New York and the Commonwealth of Massachusetts for the fiscal years June 30, 2014 through 2016; Germany for the fiscal years June 30, 2013 through 2015; and Switzerland for the fiscal years June 30, 2015 through 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.

Table of Contents

~~(13)~~13.COMMITMENTS AND CONTINGENCIES

The Company is subject to various claims and legal proceedings covering matters that arise in the ordinary course of its business activities. As of ~~September 30, 2020,~~March 31, 2021, the management of the Company believes any reasonably possible liability that may result from the resolution of these matters will not have a material adverse effect on the Company’s consolidated financial position, operating results, or cash flows.

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)~~ 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 assess an individual’s risk for developing disease later in life, identify a patient’s likelihood of responding to drug therapy and guide a patient’s dosing to ensure optimal treatment, or assess a patient’s risk of disease progression and disease recurrence. 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.

~~Table of Conten~~t s

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


(in millions)								(in millions)	Diagnostics		Other		Total
Three months ended March 31, 2021								Three months ended March 31, 2021
Revenues								Revenues	$	157.8	$	15.3	$	173.1
Depreciation and amortization								Depreciation and amortization	17.0		1.4		18.4
Segment operating income (loss)								Segment operating income (loss)	10.5		(57.2)		(46.7)
		Diagnostics		Other		Total
Three months ended September 30, 2020
Three months ended March 31, 2020								Three months ended March 31, 2020
Revenues	Revenues	$	130.5	$	14.7	$	145.2	Revenues	$	150.5	$	13.5	$	164.0
Depreciation and amortization	Depreciation and amortization	16.7		1.0		17.7		Depreciation and amortization	16.8		1.1		17.9
Segment operating loss	Segment operating loss	(0.3)		(39.3)		(39.6)		Segment operating loss	(93.6)		(40.1)		(133.7)
Three months ended September 30, 2019
Revenues		$	170.4	$	15.9	$	186.3
Depreciation and amortization		16.9		1.3		18.2
Segment operating income (loss)		17.3		(38.2)		(20.9)


		Three months ended September 30,					Three Months Ended March 31,
		2020		2019
(in millions)						(in millions)	2021		2020
Total operating loss for reportable segments	Total operating loss for reportable segments	$	(39.6)	$	(20.9)	Total operating loss for reportable segments	$	(46.7)	$	(133.7)
Unallocated amounts:	Unallocated amounts:					Unallocated amounts:
Interest income	Interest income	0.4		0.9		Interest income	0.2		0.8
Interest expense	Interest expense	(2.9)		(2.9)		Interest expense	(3.0)		(2.3)
Other	Other	(1.6)		0.6		Other	(0.1)		4.1
Loss from operations before income taxes	Loss from operations before income taxes	(43.7)		(22.3)		Loss from operations before income taxes	(49.6)		(131.1)
Income tax benefit	Income tax benefit	(28.5)		(1.7)		Income tax benefit	(10.1)		(15.9)
Net loss	Net loss	(15.2)		(20.6)		Net loss	(39.5)		(115.2)
Net loss attributable to non-controlling interest	Net loss attributable to non-controlling interest	0		0		Net loss attributable to non-controlling interest	0		0
Net loss attributable to Myriad Genetics, Inc. stockholders	Net loss attributable to Myriad Genetics, Inc. stockholders	$	(15.2)	$	(20.6)	Net loss attributable to Myriad Genetics, Inc. stockholders	$	(39.5)	$	(115.2)

~~(15)~~

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15.SUPPLEMENTAL CASH FLOW INFORMATION


		Three months ended September 30,					Three Months Ended March 31,
		2020		2019
(in millions)						(in millions)	2021		2020
Cash paid during the period for income taxes	Cash paid during the period for income taxes	$	1.3	$	0.2	Cash paid during the period for income taxes	$	0	$	0.2
Cash paid for interest	Cash paid for interest	2.6		2.8		Cash paid for interest	2.3		2.1
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	$	—	$	74.5	Operating lease right-of-use assets	$	2.7	$	0
Operating lease liabilities	Operating lease liabilities	—		(78.8)		Operating lease liabilities	2.7		0
Accrued liabilities and other long-term liabilities		—		4.3

~~(16)~~ 16.SUBSEQUENT EVENTS

~~Change in Fiscal Year~~

On October 9, 2020, the Company’s Board of Directors approved a change in the Company’s fiscal year from a fiscal year ending on the last day of June of each year to a calendar fiscal year ending on the last day of December of each year, effective January 1, 2021. Accordingly,April 26, 2021, the Company ~~will be issuing financial statements~~entered into a definitive agreement to sell the Myriad myPath, LLC laboratory, which is the laboratory that offers the myPath Melanoma test, to Castle Biosciences, Inc. for total cash consideration of $32.5 million. On May 1, 2021, the Company entered into a ~~six-month transition period ending December 31, 2020~~definitive agreement to sell select operating assets and ~~calendar year financial statements thereafter.~~intellectual property, including the Vectra® test, from the Myriad Autoimmune business unit to Laboratory Corporation of America Holdings for total cash consideration of $150.0 million.

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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 ended December 31, 2020 included in our Transition Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”), on March 16, 2021. “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 Securities and Exchange Commission 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~~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 risks and uncertainties that could cause actual results to differ materially and adversely from those described in the forward-looking statements. 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 ~~related to~~associated with COVID-19;

•the risk that sales and profit margins of our existing molecular diagnostic tests and pharmaceutical and clinical services may decline or ~~will~~that we may not ~~continue~~be able to ~~increase at historical rates;~~ operate our business on a profitable basis;

•risks related to our ability to ~~successfully transition~~generate sufficient revenue from our existing product portfolio ~~to our~~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;

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

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

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

•risks related to delays or other problems with operating 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 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 or acquire;

•risks related to our projections about the potential market opportunity for our 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 and pharmaceutical and clinical services, ~~and~~or patents or enforcement, in the United States and foreign ~~countries, such as the Supreme Court decisions in~~ countries;

•~~Mayo Collab. Servs. v. Prometheus Labs., Inc., 566 U.S. 66 (2012),~~ ~~Ass’n for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576 (2013), and~~ ~~Alice Corp. v. CLS Bank Int’l, 573 U.S. 208 (2014);~~ 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;

•the risk that we will be unable to pay, when due, amounts due under our credit or lending agreements; and ~~other factors discussed under~~

•risks related to the heading “Risk Factors” contained in Item 1A of our Annual report on Form 10-K for the fiscal year ended June 30, 2020, which has been filed with the Securities and Exchange Commission, as well as any updates to those risk factors filed from time to timematerial weakness identified in our ~~Quarterly Reports on Form 10-Q (including Item 1A below in this report) or Current Reports on Form 8-K.~~internal control over financial reporting, including the impact thereof and our remediation plan.

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. All ~~subsequent~~ 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 are a leading precision medicine company acting as a trusted advisor to transform patient lives through ~~pioneering~~ molecular ~~diagnostics.~~diagnostics and are one of the largest specialty molecular diagnostic laboratories in the world. Since our founding in 1992, we have performed tests for approximately five million patients. Through our proprietary technologies, we believe we are positioned to identify important disease genes, the proteins they produce, and the biological pathways in which ~~such genes and proteins~~they are involved to better understand the ~~molecular~~genetic basis of ~~certain~~ human ~~diseases.~~disease. We believe that identifying these biomarkers ~~(i.e., DNA,~~(DNA, RNA and proteins) will enable us to develop novel molecular diagnostic tests that can provide important information to solve unmet medical needs. ~~During the three months ended September 30, 2020, we reported total revenues of $145.2 and net loss of $(15.2) resulting in $(0.20) net loss per share.~~

Our business units have been aligned with how the chief operating decision maker reviews performance and makes decisions in managing the Company. The business units have been aggregated into two reportable segments: (i) diagnostics and (ii) other. The diagnostics segment provides testing and collaborative development of testing that is designed to assess an individual’s risk for developing disease later in life, identify a patient’s likelihood of responding to drug therapy and guide a patient’s dosing to ensure optimal treatment, or assess a patient’s risk of disease progression and disease recurrence. 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.

Business Updates

During the quarter ended ~~September 30, 2020,~~March 31, 2021, we continued to see improvement in business fundamentals ~~including test volumes,~~ for our diagnostic products which have been affected by the COVID-19 pandemic. ~~Total test volumes reached 90 percent of pre-pandemic levels by the end of the quarter compared to 75 percent of pre-pandemic levels at the end of the prior quarter ended June 30, 2020.~~ We have also made the following recent announcements:

•~~Appointed Paul J. Diaz~~Entered into Amendment No. 3 to the Amended Facility on February 22, 2021 as ~~President and Chief Executive Officer, effective August 13, 2020.~~discussed in Note 8, which modified the Amended Facility.

•~~The American College~~Announced the hiring of ~~Obstetricians~~Myriad's new Chief Growth Officer and ~~Gynecologists recently issued guidelines recommending prenatal testing for average risk patients. These guidelines have led to~~Diversity, Equity and Inclusion leader, and the new ~~medical policy guidelines for payors covering average risk testing incorporating 24 million covered lives to date.~~appointment of our Chief Marketing Officer, Chief Technology Officer, and President of Myriad Oncology.

•~~Received~~Entered into a ~~local coverage determination ("LCD")~~collaboration with Intermountain Precision Genomics for ~~Prolaris for unfavorable intermediate~~a comprehensive offering of germline and ~~high-risk patients from Palmetto GBA~~somatic tumor testing services. The strategic collaboration combines germline genetic testing, next-generation tumor sequencing and ~~CGS Administrators, LLC, two of the administrative contractors for the Centers for Medicare & Medicaid Services. The final LCD becomes effective December 6, 2020.~~world-class testing capabilities to elevate global precision oncology care.

•~~The final LCD for pharmacogenomic (PGx) testing became effective during~~Presented new data at the ~~quarter,~~American Society of Clinical Oncology Genitourinary Conference demonstrating that the Prolaris test can accurately predict which ~~expanded coverage for~~ patients ~~to all healthcare providers licensed~~will benefit from multi-modality therapy. Using the newly established threshold, 27% of men with newly diagnosed high-risk disease and ~~qualified to diagnose the condition and prescribe relevant medications (either independently or in an arrangement).~~73% with unfavorable intermediate-risk disease could avoid multi-modality therapy.

•~~Received coverage from~~Peer-reviewed journal Psychiatry Research has published a new analysis showing that the ~~German Federal Joint Committee (G-BA) for~~combinatorial approach available in the ~~EndoPredict® breast cancer prognostic test. The positive decision means that EndoPredict®~~GeneSight® Psychotropic test is ~~now available to all patients with statutory health insurance in Germany without restrictions as a benefit of the statutory health insurance scheme (GKV).~~better than single-gene testing at predicting patient outcomes and medication blood levels.

~~Change~~•Launched the new Vectra® Cardiovascular Risk assessment that can predict the risk for cardiovascular events in ~~Fiscal Year~~

~~On October 9, 2020, our Board of Directors approved a change in our fiscal year from a fiscal year ending~~patients with rheumatoid arthritis (RA). This new test result incorporates information on the last day of June of each year to a calendar fiscal year ending on the last day of December of each year, effective January 1, 2021. Accordingly, we will be issuing financial statements for a six-month transition period ending as of December 31, 2020,RA inflammation assessed by Vectra Score and ~~calendar year financial statements thereafter.~~

three additional biomarkers, combined with traditional risk factors. Vectra is an advanced blood test that objectively measures inflammation caused by RA.

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•Received the first reimbursement decision for the Myriad myChoice® Diagnostic System in Japan, which helps determine if women with ovarian cancer will benefit from the PARP inhibitor, Zejula® (niraparib). MyChoice was approved by Japan’s Ministry of Health, Labour and Welfare in September 2020 as a companion diagnostic for this indication and the reimbursement decision is now in effect.

•On April 26, 2021 and May 1, 2021, we entered into definitive agreements to sell the Myriad myPath, LLC laboratory as well as select operating assets and intellectual property, including the Vectra® test, from the Myriad Autoimmune business unit, respectively. We continue to explore strategic alternatives for our Myriad RBM business unit.

Results of Operations for the Three Months Ended ~~September 30,~~March 31, 2021 and 2020 ~~and 2019~~

~~Revenue~~

Three months ended September 30,
(In millions) 2020 2019 Change
Revenue $ 145.2 $ 186.3 $ (41.1)

The ~~Company's revenues~~results of operations for the three months ended ~~September 30,~~March 31, 2021 and 2020 ~~continued~~are discussed below. See Note 14 “Segment and Related Information” in the notes to beour Condensed Consolidated Financial Statements for information regarding our operating segments.

Revenue


	Three Months Ended March 31,				Change		% of Total Revenue
(in millions)	2021		2020		2021		2021		2020
Molecular diagnostic revenues:
Hereditary Cancer Testing	$	76.1	$	85.2	$	(9.1)	44	%	52	%
GeneSight	17.6		20.4		(2.8)		10	%	12	%
Prenatal	23.7		20.3		3.4		14	%	12	%
Vectra	10.7		10.5		0.2		6	%	6	%
myChoice CDx	8.4		3.3		5.1		5	%	3	%
Prolaris	18.5		6.8		11.7		11	%	5	%
EndoPredict	4.1		3.5		0.6		2	%	2	%
Other	0.5		0.5		—		—	%	—	%
Total molecular diagnostic revenue	159.6		150.5		9.1
Pharmaceutical and clinical service revenue	13.5		13.5		—		8	%	8	%
Total revenue	$	173.1	$	164.0	$	9.1	100	%	100	%

Revenue for the three months ended March 31, 2021 increased $9.1 million compared to the same period in the prior year. Revenue for the three months ended March 31, 2020 were negatively impacted by ~~factors related to~~ the ~~COVID-19~~ pandemic ~~including~~as patients ~~incurring~~incurred significant obstacles to access ~~healthcare professionals, which resulted in testing volumes declining~~health care professionals. Revenue from Prolaris increased $11.7 million compared to the same period in the prior year ~~across~~primarily due to expanded coverage and the ~~majority~~submission of claims for previously performed tests that were pending clarification of the ~~products. In addition,~~coverage policy. myChoice CDx revenues increased $5.1 million compared to the same period in the prior year due primarily to expansion in Japan. Prenatal revenues increased $3.4 million compared to the same period in the prior year due primarily to a 9% increase in volume and an increase of 7% in the average ~~expected~~ reimbursement per ~~test decreased due to a variety of factors such as negotiating new contracts with payors and the impact of a $2.2 million reduction~~test. These increases in revenues were partially offset by decreases in revenues for ~~estimated future refunds across the Company's products.~~Hereditary Cancer and GeneSight. Hereditary Cancer Testing revenues decreased ~~$23.9~~$9.1 million compared to the same period in the prior year due primarily to an approximate ~~18% decrease in volumes and an approximate~~ 6% decrease in average reimbursement per ~~test. GeneSight revenues declined $10.8 compared to the same period in the prior year due primarily to an approximate 28%~~test and 5% decrease in ~~volumes and an approximate 27% decrease in average reimbursement per test. Prenatal revenues declined $7.0~~volume. Revenue from GeneSight decreased $2.8 million compared to the same period in the prior year due primarily to a decrease in the average reimbursement per ~~test of approximately 34%.~~ test.

Pharmaceutical and clinical service revenue ~~declined $4.8~~was flat for the three months ended March 31, 2021 compared to the same period in the prior ~~year, primarily as a result~~year. Revenues decreased for the period ended March 31, 2021 by $3.9 million due to the sale of ~~selling~~ the ~~Clinic~~Privatklinik Dr. Robert Schindlbeck GmbH & Co. KG (the “Clinic”), an internal medicine emergency hospital, in February 2020.

~~The following table presents additional detail regarding the composition of our total~~ This decrease was offset by $2.5 million generated from processing COVID-19 tests, and also by increases in revenue from pharmaceutical services for the three months ended ~~September 30, 2020 and 2019:~~March 31, 2021 compared to the three months ended March 31, 2020.

Three months ended September 30, $
Change % of Total Revenue
(In millions) 2020 2019 2020 2019
Molecular diagnostic revenues:
Hereditary Cancer Testing $ 80.6 $ 104.5 $ (23.9) 56 % 56 %
Prenatal 16.5 23.5 (7.0) 11 % 13 %
GeneSight 11.9 22.7 (10.8) 8 % 12 %
Vectra 9.1 11.0 (1.9) 6 % 6 %
myChoice CDx 7.8 1.3 6.5 5 % 1 %
Prolaris 6.4 6.5 (0.1) 4 % 3 %
EndoPredict 2.8 2.3 0.5 2 % 1 %
Other 0.6 0.2 0.4 — % — %
Total molecular diagnostic revenue 135.7 172.0 (36.3)
Pharmaceutical and clinical service revenue 9.5 14.3 (4.8) 7 % 8 %
Total revenue $ 145.2 $ 186.3 $ (41.1) 100 % 100 %

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Cost of Sales


		Three months ended September 30,									Three Months Ended March 31,
(In millions)		2020			2019			Change
(in millions)										(in millions)	2021			2020			Change
Cost of molecular diagnostic testing	Cost of molecular diagnostic testing	$	39.9		$	41.2		$	(1.3)	Cost of molecular diagnostic testing	$	44.1		$	43.1		$	1.0
Cost of molecular diagnostic testing as a % of revenue	Cost of molecular diagnostic testing as a % of revenue	29.4		%	24.0		%			Cost of molecular diagnostic testing as a % of revenue	27.6		%	28.6		%
Cost of pharmaceutical and clinical services	Cost of pharmaceutical and clinical services	$	4.3		$	8.5		$	(4.2)	Cost of pharmaceutical and clinical services	$	6.2		$	7.0		$	(0.8)
Cost of pharmaceutical and clinical services as a % of revenue	Cost of pharmaceutical and clinical services as a % of revenue	45.3		%	59.4		%			Cost of pharmaceutical and clinical services as a % of revenue	45.9		%	51.9		%

The cost of molecular diagnostic testing as a percentage of revenue ~~increased~~decreased slightly from ~~24.0%~~28.6% to ~~29.4%~~27.6% during the three months ended ~~September 30, 2020~~March 31, 2021 compared to the same period in the prior year. The ~~increase~~decrease was primarily driven by the ~~decline~~increase in revenue from ~~lower~~higher test volumes during the period ~~attributable to~~as part of our continued recovery from the impact of COVID-19 as ~~lower~~higher revenues were generated to cover fixed costs of performing the tests.

The cost of pharmaceutical and clinical services as a percentage of revenue decreased from ~~59.4%~~51.9% to ~~45.3%~~45.9% during the three months ended ~~September 30, 2020~~March 31, 2021 compared to the same period in the prior year due to the ~~sale~~change in mix of ~~the Clinic in February 2020.~~

services provided.

Research and Development ~~Expenses~~Expense

Three months ended September 30,
(In millions) 2020 2019 Change
R&D expense $ 17.6 $ 21.3 $ (3.7)
R&D expense as a % of sales 12.1 % 11.4 %


	Three Months Ended March 31,
(in millions)	2021			2020			Change
R&D expense	$	23.1		$	19.7		$	3.4
R&D expense as a % of total revenue	13.3		%	12.0		%

Research and development expense for the three months ended ~~September 30, 2020 decreased~~March 31, 2021 increased compared to the same period in the prior year primarily due to ~~decreased personnel expenses from a decrease~~costs incurred as part of the Company’s strategic transformation initiatives and due to an increase in ~~headcount and decreased technology related expenses from synergies between our labs located in Salt Lake City and in San Francisco.~~costs for lab supplies.

Change in the Fair Value of Contingent Consideration

Three months ended September 30,
(In millions) 2020 2019 Change
Change in the fair value of contingent consideration $ (1.1) $ 0.7 $ (1.8)
Change in the fair value of contingent consideration as a % of sales (0.8) % 0.4


	Three months ended March 31,
(in millions)	2021			2020			Change
Change in the fair value of contingent consideration	$	0.9		$	(3.4)		$	4.3
Change in the fair value of contingent consideration as a % of total revenue	0.5		%	(2.1)		%

The fair value of contingent consideration for the three months ended ~~September 30, 2020 decreased~~March 31, 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 ~~acquisition.~~Diagnostics GmbH acquisition in fiscal year 2016.

Selling, General and Administrative ~~Expenses~~Expense

Three months ended September 30,
(In millions) 2020 2019 Change
SG&A expense $ 124.1 $ 135.5 $ (11.4)
SG&A expense as a % of sales 85.5 % 72.7 %


	Three Months Ended March 31,
(in millions)	2021			2020			Change
Selling, general and administrative expense	$	145.5		$	132.9		$	12.6
Selling, general and administrative expense as a % of total revenue	84.1		%	81.0		%

Selling, general and administrative expense increased for the three months ended March 31, 2021 compared to the same period in the prior year primarily due to a $12.9 million increase in costs incurred as part of the Company's strategic transformation initiative, and due to a $2.9 million increase in legal and professional expenses compared to the same period in the prior year. These costs were partially offset by a decrease in sales and marketing expenses of $6.6 million due primarily to fewer in-person sales and marketing events and travel-related expenses.

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Goodwill and intangible asset impairment charges


	Three Months Ended March 31,
(in millions)	2021			2020			Change
Goodwill and intangible asset impairment charges	$	—		$	98.4		$	(98.4)
Goodwill and intangible asset impairment charges as a % of total revenue	—		%	60.0		%

Goodwill and intangible asset impairment charges decreased for the three months ended ~~September 30, 2020~~March 31, 2021 compared to the same period in the prior year primarily due to the Company ~~implementing cost saving measures due~~recognizing goodwill impairment charges in the prior period related to the ~~decline~~Crescendo reporting unit and charges in ~~testing volumes as a result of~~ the impacts of COVID-19 and due to a decline in expense from the sale of the Clinic in February 2020. The cost savings measures implemented by the Company have been partially offset by increased legal expenses and expensesprior year related to ~~our leadership transition~~the abandonment of an in-process research and development intangible. There were no impairments recognized in the current ~~six-month transition period ending December 31, 2020.~~period.

Other ~~Expense, net~~Income (Expense)

Three months ended September 30,
(In millions) 2020 2019 Change
Other expense, net $ (4.1) $ (1.4) $ (2.7)


	Three Months Ended March 31,
(in millions)	2021		2020		Change
Other income (expense)	$	(2.9)	$	2.6	$	(5.5)

Other ~~expense,~~income (expense), net increased for the three months ended ~~September 30, 2020~~March 31, 2021 compared to the same period in the prior year due to ~~increased~~gains on foreign exchange ~~losses~~transactions, the gain recognized on the sale of the Clinic, and ~~to decreased interest income.~~income from a state grant in the prior period that did not recur in the current period.

Income Tax Benefit


		Three months ended September 30,									Three Months Ended March 31,
(In millions)		2020			2019			Change
(in millions)										(in millions)	2021			2020			Change
Income tax benefit	Income tax benefit	$	(28.5)		$	(1.7)		$	(26.8)	Income tax benefit	$	(10.1)		$	(15.9)		$	5.8
Effective tax rate	Effective tax rate	65.2		%	7.6		%			Effective tax rate	20.4		%	12.1		%

Our tax rate is the product of a blended U.S. federal effective rate of ~~21%~~21.0% and a blended state income tax rate of approximately 3%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.

Income tax benefit for the three months ended ~~September 30, 2020~~March 31, 2021 was ~~$28.5,~~$10.1 million, and our effective tax rate was ~~65.2%~~20.4%. The increase in the effective rate for the three months ended ~~September 30, 2020~~March 31, 2021 as compared to the same period in the prior year is primarily due to ~~carrying back net operating losses due to~~ the ~~CARES Act.~~impairment of intangible assets and the sale of foreign subsidiaries in the prior period, both of which were partially non-deductible.

Liquidity and Capital Resources

Our primary sources of liquidity are our cash, cash equivalents and marketable investment securities, our cash flows from operations and amounts available under our Amended Facility. As discussed in our Transition Report on Form 10-K for the transition period ended December 31, 2020, we began exploring strategic alternatives for our Myriad RBM, Myriad Dermatology, and Myriad Autoimmune business units in the quarter ended December 31, 2020. In April and May 2021, we entered into separate definitive agreements for the sale of the Myriad myPath, LLC laboratory, and the sale of select operating assets and intellectual property, including the Vectra® test, from the Myriad Autoimmune business unit for total cash consideration of approximately $182.5 million. We expect to close the sales during the next six months, generating proceeds that will provide additional liquidity. We continue to explore strategic alternatives for our Myriad RBM business unit. Our capital deployment strategy focuses on use of resources in the key areas of research and development, debt repayment, and acquisitions. We believe that investing organically through research and development or acquisitively to support business strategy provides the best return on invested capital.

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We believe that our existing capital resources and the cash to be generated from future sales ~~taking into consideration the expected continuing impacts of COVID-19 on our operations,~~ will be sufficient to meet our projected operating requirements and repay the outstanding Amended Facility, which matures on July 31, 2023 and which has no scheduled principal payments prior to that date. Our available capital resources, however, may be consumed more rapidly than currently expected, 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. We are subject to financial covenants as part of our outstanding Amended Facility. ~~Based on the continued uncertainty regarding the impact of COVID-19 on our future operations, it~~It is possible that we could be in violation of certain financial covenants contained in the Amended Facility ~~within~~in the ~~Amendment Period, which runs through June 30, 2021.~~future. We may seek waivers or amendments from our lenders in order to avoid a future potential covenant violation, in addition to taking other potential actions. On February 22, 2021, entered into Amendment No. 3 to the Amended Facility to, among other things, waive compliance with the leverage ratio covenant and the interest coverage ratio covenant through the quarter ending March 31, 2022 and to also lower the minimum liquidity covenant through the same period. If we were unable to comply with the covenants in the future, that could result in an increase in the rate of interest and limits on our ability to incur certain additional indebtedness and could potentially cause the loan repayment to be accelerated. 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.

~~Additionally,~~The Amended Facility restricts our ability to make additional 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. Amendment No. 3 to the Amended Facility also included an immediate reduction in the revolving commitments to $300.0 million, with a further reduction to $250.0 million by September 30, 2021, and provided for further reductions to the revolving commitments, or mandatory prepayments of revolving loans, in the event of certain asset sales, which could limit our borrowing capacity, or reduce liquidity, in future periods. The Amended Facility allows us to keep the net cash proceeds of material asset sales received above certain dollar thresholds without corresponding mandatory prepayments or commitment reductions.

Due to the continuing evolving global situation from the COVID-19 pandemic, and resulting global disruptions have caused significant volatility in financial markets. This disruption can contribute to potential defaults in our accounts receivable, affect asset valuations resulting in impairment charges, and affect the availability of lease and financing credit as well as other segments of the credit markets. We utilize a range of financing methods to fund our operations and capital expenditures and expect to continue to maintain financing flexibility in the current market conditions. However, due to the continuing rapidly evolving global situation, it is not possible to predict whether unanticipated consequences of the pandemic are reasonably likely to materially affect our liquidity and capital resources in the future.

Our capital deployment strategy focuses on use of resources in the key areas of research and development, acquisitions, debt repayment, and the repurchase of our common stock. We believe that investing organically through research and development or acquisitively to support business strategy provides the best return on invested capital.

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


(In millions)		September 30, 2020		June 30, 2020		Change
(in millions)								(in millions)	March 31, 2021		December 31, 2020		Change
Cash and cash equivalents	Cash and cash equivalents	$	118.3	$	163.7	$	(45.4)	Cash and cash equivalents	$	148.9	$	117.0	$	31.9
Marketable investment securities	Marketable investment securities	42.1		54.1		(12.0)		Marketable investment securities	27.2		33.7		(6.5)
Long-term marketable investment securities	Long-term marketable investment securities	30.2		37.0		(6.8)		Long-term marketable investment securities	11.9		21.0		(9.1)
Cash, cash equivalents and marketable investment securities	Cash, cash equivalents and marketable investment securities	$	190.6	$	254.8	$	(64.2)	Cash, cash equivalents and marketable investment securities	$	188.0	$	171.7	$	16.3

The ~~decrease~~increase in cash, cash equivalents, and marketable investment securities was primarily driven by ~~$59.3~~the change in ~~cash used by operations~~the balance of prepaid taxes due to the receipt of an $89.6 million U.S. federal tax refund, and ~~the use~~proceeds of ~~$3.8 for the proceeds~~$26.0 million from the ~~issuance~~exercise of ~~common~~ stock options, net of shares exchanged for withholding tax, offset by ~~$18.6 in proceeds from maturities~~a $70.0 million repayment of ~~marketable investments.~~

the Company's revolving credit facility.

The following table represents the condensed consolidated cash flow statement:


		Three months ended September 30,							Three Months Ended March 31,
(In millions)		2020		2019		Change
(in millions)								(in millions)	2021		2020		Change
Cash flows from operating activities	Cash flows from operating activities	$	(59.3)	$	15.8	$	(75.1)	Cash flows from operating activities	$	71.8	$	16.8	$	55.0
Cash flows from investing activities	Cash flows from investing activities	17.1		(7.1)		24.2		Cash flows from investing activities	8.2		23.2		(15.0)
Cash flows from financing activities	Cash flows from financing activities	(3.9)		(12.3)		8.4		Cash flows from financing activities	(48.5)		0.2		(48.7)
Effect of foreign exchange rates on cash and cash equivalents	Effect of foreign exchange rates on cash and cash equivalents	0.7		0.3		0.4		Effect of foreign exchange rates on cash and cash equivalents	0.4		(1.9)		2.3
Net decrease in cash and cash equivalents		(45.4)		(3.3)		(42.1)
Change in cash and cash equivalents classified as held for sale								Change in cash and cash equivalents classified as held for sale	—		1.5		(1.5)
Net increase in cash and cash equivalents								Net increase in cash and cash equivalents	31.9		39.8		(7.9)
Cash and cash equivalents at the beginning of the period	Cash and cash equivalents at the beginning of the period	163.7		93.2		70.5		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	Cash and cash equivalents at the end of the period	$	118.3	$	89.9	$	28.4	Cash and cash equivalents at the end of the period	$	148.9	$	121.0	$	27.9

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Cash Flows from Operating Activities

The ~~decrease~~increase in cash flows from operating activities for the three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same period in the prior year, was primarily due to the ~~$107.9~~ change in the balance of prepaid taxes due to the receipt of a $89.6 million U.S. federal tax refund, and the ~~$17.0~~$20.6 million change in the balance of trade accounts receivable ~~offset by~~period over period due to an increase in ~~the unrecognized tax benefit adjustment of $13.2~~sales volumes and ~~an increase~~cash collections in the ~~deferred income tax adjustment~~final month of ~~$48.4.~~the quarter ended March 31, 2021 compared to previous period.

Cash Flows from Investing Activities

For the three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same period in the prior year, the change in cash flows from investing activities was driven primarily by cash proceeds of $21.3 million from the ~~purchase~~sale of ~~approximately $23.1 of marketable securities during~~ the ~~same period~~Clinic in ~~the prior year that did not occur during the three months ended September 30,~~February 2020.

Cash Flows from Financing Activities

For the three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same period in the prior year, the decrease in cash flows from financing activities was driven primarily by the use of ~~$8.6~~$70.0 million in cash for repayment of the credit facility during the three months ended March 31, 2021. The decrease was partially offset by an increase due to proceeds of $26.0 million from the exercise of stock options, net of shares exchanged for withholding tax, for the three months ended March 31, 2021 compared to the same period in the ~~prior year that did not occur during the three months ended September 30, 2020.~~previous 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.

Share Repurchase Program

Our Board 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, 2020,~~March 31, 2021, we are authorized to repurchase up to $110.7 million under our current share repurchase authorization. See also “Part II, Item 2. Unregistered Sales of Equity Securities and Use of Proceeds – Issuer Purchases of Equity Securities”.

Critical Accounting Policies

Critical accounting policies 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. No significant changes to our accounting policies took place during the period. For a further discussion of our critical accounting policies, see our ~~Annual~~Transition Report on Form 10-K for the ~~fiscal year~~transition period ended ~~June 30,~~December 31, 2020.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes in our market risk during the three months ended ~~September 30, 2020~~March 31, 2021 compared to the disclosures in Part II, Item 7A of our ~~Annual~~Transition Report on Form 10-K for the ~~fiscal year~~transition period ended ~~June 30,~~December 31, 2020, which isare incorporated by reference herein.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures.

~~Our principal executive officer and principal financial officer, after evaluating the effectiveness of our~~We maintain disclosure controls and procedures ~~(as defined in Exchange Act~~(“Disclosure Controls”) within the meaning of Rules 13a-15(e) and 15d-15(e)~~) as~~ of the ~~end~~Securities Exchange Act of 1934, as amended, or the ~~period covered by this Quarterly Report on Form 10-Q, have concluded that, based on such evaluation, our disclosure controls and procedures were effective~~Exchange Act. Our Disclosure Controls are designed to ensure that information required to be disclosed by us in the reports ~~that~~ 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 Securities and Exchange Commission’s rules and forms. Our Disclosure Controls are also designed to ensure that such information is accumulated and communicated to our management, including our ~~principal executive~~Chief Executive Officer and ~~principal financial officers, or persons performing similar functions,~~Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

In designing and evaluating our ~~disclosure controls and procedures, 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 ~~our~~ management necessarily ~~is required to apply~~applied its judgment in evaluating ~~the cost-benefit relationship of~~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 March 31, 2021, our Disclosure Controls were not effective due to a material weakness in the Company's internal control over financial reporting as disclosed below.

In connection with the preparation of our consolidated financial statements as of and for the transition period ended December 31, 2020, we identified a material weakness in controls over the accounting for intercompany transactions, foreign currency exchanges and foreign currency translation related to our international subsidiaries, which is in the process of being remediated as of March 31, 2021. Specifically, 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 December 31, 2020.

Plans to Remediate Material Weakness

We are in the process of implementing effective internal controls measures to improve our internal control over financial reporting and remediate the material weakness identified above. As of the date of this Quarterly Report on Form 10-Q, we have taken the following actions and are in the process of making the following changes in our internal control environment to help remediate the material weakness:

•We have completed our design assessment of additional control and review procedures needed to provide more robust and comprehensive internal controls over financial reporting that address the risks of material misstatement related to the accounting for intercompany transactions, foreign currency exchanges and foreign currency translation within our business processes.

•We are currently implementing additional application controls in our financial systems, implementing formal review procedures, and formally documenting our newly designed processes for the identified areas.

While these actions and planned actions are subject to ongoing management evaluation and will require validation and testing of the design and operating effectiveness of internal controls over a sustained period of financial reporting cycles, we are committed to the continuous improvement of our internal control over financial reporting and will continue to diligently review our internal control over financial reporting for that purpose.

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Changes in Internal Controls

The Company is in the midst of a multi-year transformation project to achieve better analytics and process efficiencies through the use of Oracle Fusion Cloud Services System. During the ~~quarter~~three months ended ~~September 30, 2020,~~March 31, 2021, the Company completed the implementation of certain modules used in the financial statement close process and management reporting. Additional phases will continue to be implemented ~~over~~during the ~~coming year.~~fiscal year ending December 31, 2021. Emphasis ~~has been~~will continue to be placed on the maintenance of effective internal controls and assessment of the design and operating effectiveness of key control activities throughout development and deployment of each phase.

Other than as described above, there were no changes in our internal control over financial reporting that occurred during the three months ended ~~September 30, 2020~~March 31, 2021 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~~

~~Purported Securities Class Action Claims~~

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 Executive Vice President and Chief Financial Officer, R. Bryan Riggsbee (“Defendants”). On February 21, 2020, the plaintiff filed an amended class action complaint, which added the Company’s 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. 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.

~~Other Legal Proceedings~~

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 September 11, 2019, plaintiffs filed a second amended complaint, and on October 10, 2019, Assurex filed a Motion to Dismiss Plaintiff’s Second Amended Complaint for Lack of Personal Jurisdiction and Standing, requesting that the second amended complaint be dismissed in its entirety, with prejudice, for lack of personal jurisdiction and standing. On July 20, 2020, this motion was denied. The Company’s motion filed on August 12, 2020, for interlocutory appeal of the denial of the motion to dismiss, was denied in a hearing on October 30, 2020. The Company intends to continue 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.Proceedings.

Qui Tam Lawsuit

In June 2016, our ~~wholly-owned~~wholly owned subsidiary, Crescendo Bioscience, Inc. (“CBI”), received a subpoena from the Office of Inspector General of the Department of Health and Human Services requesting 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 intends to continue 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.

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 Interim President and Chief Executive Officer, Executive Vice President and Chief Financial Officer, R. Bryan Riggsbee (“Defendants”). On February 21, 2020, the plaintiff filed an amended class action complaint, which added the Company’s 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. 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.

Other Legal Proceedings

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. We intend to continue 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, but the Company does not expect this matter to have a material impact on our business, financial position or results of operations.

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.

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Item 1A. Risk ~~Factors~~Factors.

~~The following risk factor disclosure should be read in conjunction with~~There have been no material changes to the risk factors ~~described~~included in the ~~Annual~~Transition Report on Form 10-K for the ~~fiscal year~~transition period ended ~~June 30, 2020.~~

~~We may be adversely impacted if we are unable to successfully implement new systems or unable to adapt systems to our change in fiscal year-end.~~

Information technology systems are an important part of our business operations. We are in the midst of a multi-year transformation project to achieve better analytics and process efficiencies through the use of Oracle Fusion Cloud Services System ("Oracle Fusion"). This project is expected to improve the efficiency and effectiveness of certain financial and business transaction processes and the underlying systems environment. During the quarter ended September 30, 2020, we completed the implementation of certain modules used in the financial statement close process and management reporting. Additional integrations are expected to take place over the next year. An implementation of this nature is a major undertaking from a financial, management and personnel perspective. The implementation of Oracle Fusion may prove to be more difficult, costly, or time consuming than expected, and there can be no assurance that this system will be beneficial to the extent anticipated.

In addition, we have announced a change in our fiscal year end from a fiscal year ending on the last day of June of each year to a calendar fiscal year ending on the last day of December each year, effective January 1, 2021, which will require certain modifications to our systems used for accounting and management reporting. If the systems are not appropriately configured for the change in fiscal year-end it could have a material adverse effect on our results of operations and financial condition.

We are subject to debt covenants that impose operating and financial restrictions on us and if we are not able to comply with them, it could have a material adverse impact on our operations and liquidity.

Covenants in the Amended Facility impose operating and financial restrictions on us. These restrictions may prohibit or place limitations on, among other things, our ability to incur additional indebtedness, create certain types of liens, and complete mergers, consolidations, or change in control transactions. Under the Amended Facility, a change in control of the Company, which means that a shareholder or a group of shareholders is or becomes the beneficial owner, directly or indirectly, of more than 35% of the total voting power of the voting stock of the Company, would require mandatory prepayment of the outstanding debt. The Amended Facility may also prohibit or place limitations on our ability to sell assets, pay dividends or provide other distributions to shareholders. These restrictions could also limit our ability to take advantage of business opportunities.

We must maintain specified leverage and interest ratios measured as of the end of each applicable quarter as financial covenants in the Amended Facility. The Amended Facility, through Amendment No. 2 entered into on May 1, 2020, modified compliance with the leverage covenant and the interest coverage ratio covenant, which were waived through March 31, 2021, and added a minimum EBITDA covenant for the quarters ending December 31, 2020 and March 31, 2021. Based on the continued uncertainty regarding the impact of COVID-19 on our future operations, it is possible that we could be in violation of certain financial covenants contained in the Amended Facility within the modification period, which runs through June 30, 2021.

If we are unable to comply with the covenants and ratio in the Amended Facility, we may be in default under the agreement. A default would result in an increase in the rate of interest and limits on our ability to incur certain additional indebtedness and it could potentially cause the loan repayment to be accelerated, any of which could have a material adverse impact on our operations and liquidity.2020.

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, 2020.~~March 31, 2021. 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. ~~The transactions occurred in open market purchases and pursuant to a trading plan under Rule 10b5-1.~~

No stock repurchases were made under our stock repurchase program during the three months ended ~~September 30, 2020.~~March 31, 2021.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

~~None.~~Not applicable.

Item 5. Other Information.

None.

Item 6. Exhibits.


10.1			~~Executive Employment~~Amendment No. 3, dated February 22, 2021, to the Credit Agreement, ~~between~~dated December 23, 2016, among the ~~Registrant~~Company, the lenders from time to time party thereto, and ~~Paul J. Diaz dated~~JPMorgan Chase Bank, N.A., as administrative agent, as amended July ~~24, 2020.~~31, 2018 and May 1, 2020 (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 February 23, 2021).

10.2*10.2			~~Performance-Based Restricted Stock Unit Agreement between~~Non-Employee Director Compensation Policy (incorporated by reference to Exhibit 10.8 to the ~~Registrant~~ ~~and Paul J. Diaz dated~~ O c ~~tober 8, 2020.~~

~~10.3~~			~~Restricted Stock Unit Agreement between~~Company’s Transition Report on Form 10-K, File No. 000-26642, filed with the ~~Registrant and Paul J. Diaz dated August 13, 2020.~~

~~10.4~~			~~Performance-Based Non-Qualified Stock Option Agreement between the Registrant and Paul J. Diaz dated August 13, 2020.~~

~~10.5~~			~~Non-Qualified Stock Option Agreement between the Registrant and Paul J. Diaz dated August 13, 2020.~~

~~10.6~~			~~Form of Separation and Release~~ ~~Agreement between the Registrant and Paul J.~~ ~~Diaz.~~ SEC on March 16, 2021).

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, 2020,~~March 31, 2021, has been formatted in Inline XBRL.

			* The appendix to this exhibit has been omitted pursuant to Item 601(a)(5) of Regulation S-K. A copy of the omitted appendix will be furnished to the SEC upon request.

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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 9, 2020~~May 5, 2021	By:	/s/ Paul J. Diaz
		Paul J. Diaz
		President and Chief Executive Officer
		(Principal executive officer)



Date: ~~November 9, 2020~~May 5, 2021	By:	/s/ R. Bryan Riggsbee
		R. Bryan Riggsbee
		Executive Vice President, Chief Financial Officer
		(Principal financial and accounting officer)

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	Three months ended September 30,				$ Change		% of Total Revenue
(In millions)	2020		2019				2020		2019
Molecular diagnostic revenues:
Hereditary Cancer Testing	$	80.6	$	104.5	$	(23.9)	56	%	56	%
Prenatal	16.5		23.5		(7.0)		11	%	13	%
GeneSight	11.9		22.7		(10.8)		8	%	12	%
Vectra	9.1		11.0		(1.9)		6	%	6	%
myChoice CDx	7.8		1.3		6.5		5	%	1	%
Prolaris	6.4		6.5		(0.1)		4	%	3	%
EndoPredict	2.8		2.3		0.5		2	%	1	%
Other	0.6		0.2		0.4		—	%	—	%
Total molecular diagnostic revenue	135.7		172.0		(36.3)
Pharmaceutical and clinical service revenue	9.5		14.3		(4.8)		7	%	8	%
Total revenue	$	145.2	$	186.3	$	(41.1)	100	%	100	%