Cover
Cover - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Mar. 24, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 000-21617 | ||
Entity Registrant Name | ProPhase Labs, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 23-2577138 | ||
Entity Address, Address Line One | 711 Stewart Avenue | ||
Entity Address, Address Line Two | Suite 200 | ||
Entity Address, City or Town | Garden City | ||
Entity Address, State or Province | NY | ||
Entity Address, Postal Zip Code | 11530 | ||
City Area Code | (215) | ||
Local Phone Number | 345-0919 | ||
Title of 12(b) Security | Common Stock, $0.0005 par value per share | ||
Trading Symbol | PRPH | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 151,728,652 | ||
Entity Common Stock, Shares Outstanding | 17,182,841 | ||
Documents Incorporated by Reference | Portions of the Registrant’s definitive proxy statement relating to its 2023 annual meeting of stockholders (the “2023 Proxy Statement”) are incorporated by reference into Part III of this Annual Report on Form 10-K where indicated. The 2023 Proxy Statement will be filed with the U.S. Securities and Exchange Commission within 120 days after the end of the fiscal year to which this report relates | ||
Entity Central Index Key | 0000868278 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Audit Information [Abstract] | |
Auditor Name | Morison Cogen LLP |
Auditor Firm ID | 536 |
Auditor Location | Blue Bell, Pennsylvania |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 9,109 | $ 8,408 |
Restricted cash | 0 | 250 |
Marketable debt securities, available for sale | 8,328 | 8,779 |
Marketable equity securities, at fair value | 0 | 76 |
Accounts receivable, net | 37,054 | 37,708 |
Inventory, net | 3,976 | 4,600 |
Prepaid expenses and other current assets | 2,366 | 1,496 |
Total current assets | 60,833 | 61,317 |
Property, plant and equipment, net | 7,288 | 5,947 |
Prepaid expenses, net of current portion | 121 | 460 |
Right-of-use asset, net | 4,059 | 4,402 |
Intangible assets, net | 8,475 | 10,852 |
Goodwill | 5,709 | 5,709 |
Other assets | 1,163 | 608 |
TOTAL ASSETS | 87,648 | 89,295 |
Current liabilities | ||
Accounts payable | 5,905 | 7,026 |
Accrued diagnostic services | 1,009 | 1,890 |
Accrued advertising and other allowances | 99 | 104 |
Lease liabilities | 301 | 663 |
Deferred revenue | 2,499 | 2,034 |
Income tax payable | 4,190 | 1,312 |
Other current liabilities | 2,072 | 2,495 |
Total current liabilities | 16,075 | 15,524 |
Non-current liabilities: | ||
Deferred revenue, net of current portion | 1,059 | 905 |
Deferred tax liability, net | 224 | 0 |
Note payable | 0 | 44 |
Unsecured convertible promissory notes, net | 2,400 | 9,996 |
Lease liabilities, net of current portion | 4,259 | 4,198 |
Total non-current liabilities | 7,942 | 15,143 |
Total liabilities | 24,017 | 30,667 |
COMMITMENTS AND CONTINGENCIES | ||
Stockholders’ equity | ||
Preferred stock authorized 1,000,000, $0.0005 par value, no shares issued and outstanding | 0 | 0 |
Common stock authorized 50,000,000, $0.0005 par value, 16,210,776 and 15,485,900 shares outstanding, respectively | 16 | 16 |
Additional paid-in capital | 109,138 | 104,552 |
Retained earnings (accumulated deficit) | 11,753 | 2,642 |
Treasury stock, at cost, 18,126,970 and 16,818,846 shares, respectively | (58,033) | (48,407) |
Accumulated other comprehensive loss | 757 | (175) |
Total stockholders’ equity | 63,631 | 58,628 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 87,648 | $ 89,295 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Preferred stock, authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, par or stated value (in dollars per share) | $ 0.0005 | $ 0.0005 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock, par or stated value (in dollars per share) | $ 0.0005 | $ 0.0005 |
Common stock, outstanding (in shares) | 16,210,776 | 15,485,900 |
Treasury stock (in shares) | 18,126,970 | 16,818,846 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Other Comprehensive Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | ||
Revenues, net | $ 122,647 | $ 79,042 |
Cost of revenues | 51,993 | 37,054 |
Gross profit | 70,654 | 41,988 |
Operating expenses: | ||
Diagnostic expenses | 12,022 | 9,174 |
General and administration | 34,385 | 22,493 |
Research and development | 652 | 520 |
Total operating expenses | 47,059 | 32,187 |
Income (loss) from operations | 23,595 | 9,801 |
Interest income, net | 153 | 642 |
Interest expense | (764) | (1,148) |
Change in fair value of investment securities | (76) | (240) |
Impairment of secured promissory note receivable | 0 | (3,750) |
Income from operations before income taxes | 22,908 | 5,305 |
Income tax benefit (expense) | (4,445) | 968 |
Income from operations after income taxes | 18,463 | 6,273 |
Other comprehensive income (loss): | ||
Unrealized income (loss) on marketable debt securities | 932 | (164) |
Total comprehensive income | $ 19,395 | $ 6,109 |
Earnings per share: | ||
Basic | $ 1.17 | $ 0.41 |
Diluted | $ 1.02 | $ 0.40 |
Weighted average common shares outstanding: | ||
Basic | 15,845 | 15,172 |
Diluted | 18,651 | 18,393 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid in Capital | Accumulated (Deficit) Earnings | Comprehensive Loss | Treasury Stock |
Beginning balance (in shares) at Dec. 31, 2020 | 11,604,253 | |||||
Beginning balance, value at Dec. 31, 2020 | $ 10,556 | $ 14 | $ 61,674 | $ (3,631) | $ (11) | $ (47,490) |
Unrealized loss on marketable debt securities, net of realized losses (in shares) | 3,000,000 | |||||
Unrealized loss on marketable debt securities, net of realized losses of $3, net of taxes | 35,135 | $ 2 | 35,133 | |||
Issuance of common stock and warrants for cash from private offering (in shares) | 550,000 | |||||
Issuance of common stock and warrants for cash from private offering | 5,500 | 5,500 | ||||
Issuance of common shares related to business acquisition (in shares) | 483,685 | |||||
Issuance of common shares related to business acquisition | 3,608 | 3,608 | ||||
Cash dividends | (4,546) | (4,546) | ||||
Repurchases of common share (in shares) | (166,824) | |||||
Repurchases of common shares | (917) | (917) | ||||
Net unrealized loss, investments in marketable debt securities | (164) | (164) | ||||
Cashless warrants exercise (in shares) | 5,986 | |||||
Stock-based compensation (in shares) | 8,800 | |||||
Stock-based compensation | 3,183 | 3,183 | ||||
Net Income | 6,273 | 6,273 | ||||
Ending balance (in shares) at Dec. 31, 2021 | 15,485,900 | |||||
Ending balance, value at Dec. 31, 2021 | 58,628 | $ 16 | 104,552 | 2,642 | (175) | (48,407) |
Cash dividends | (9,352) | (9,352) | ||||
Repurchases of common share (in shares) | (303,145) | |||||
Repurchases of common shares | (2,152) | (2,152) | ||||
Net unrealized loss, investments in marketable debt securities | 1,294 | |||||
Stock-based compensation | 3,986 | 3,986 | ||||
Net Income | 18,463 | 18,463 | ||||
Issuance of common stock for debt conversion (in shares) | 200,000 | |||||
Issuance of common stock for debt conversion | $ 600 | 600 | ||||
Issuance of common stock upon stock options cashless exercise (in shares) | 1,833,000 | 828,021 | ||||
Treasury shares repurchased to satisfy tax withholding obligations | $ 7,474 | 7,474 | ||||
Unrealized gain on marketable debt securities, net of taxes | 932 | 932 | ||||
Ending balance (in shares) at Dec. 31, 2022 | 16,210,776 | |||||
Ending balance, value at Dec. 31, 2022 | $ 63,631 | $ 16 | $ 109,138 | $ 11,753 | $ 757 | $ (58,033) |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) $ in Thousands | 12 Months Ended |
Dec. 31, 2021 USD ($) | |
Statement of Stockholders' Equity [Abstract] | |
Realized losses | $ 3 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities | ||
Net Income | $ 18,463 | $ 6,273 |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Realized loss on marketable debt securities | 354 | 165 |
Depreciation and amortization | 4,718 | 3,234 |
Amortization of debt discount | 4 | 5 |
Amortization on right-of-use assets | 343 | 329 |
Loss on sales of assets | (127) | 0 |
Impairment of secured promissory note receivable | 0 | 3,750 |
Stock-based compensation expense | 3,986 | 3,183 |
Change in fair value of investment securities | (174) | 240 |
Non-cash interest income on secured promissory note receivable | 0 | (316) |
Accounts receivable allowances | (761) | 3,866 |
Inventory valuation reserve | (78) | 267 |
Bad debt expense, direct write-offs | 6,163 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (4,498) | (38,197) |
Inventory | 702 | (1,746) |
Prepaid and other assets | (617) | 1,445 |
Other assets | (555) | (368) |
Accounts payable and accrued expenses | (1,121) | 2,450 |
Accrued diagnostic services | (881) | 1,890 |
Accrued advertising and other allowances | (5) | |
Deferred revenue | 619 | 2,608 |
Deferred tax liability, net | (138) | |
Lease liabilities | (301) | 130 |
Income taxes payable | 2,878 | |
Other liabilities | (423) | (2,827) |
Net cash provided by (used in) operating activities | 28,551 | (13,619) |
Cash flows from investing activities | ||
Business acquisitions, net of cash acquired | 0 | (9,066) |
Issuance of secured promissory note receivable | 0 | 1,000 |
Purchase of marketable securities | (6,777) | (21,527) |
Proceeds from maturities of marketable securities | 7,120 | |
Proceeds from sale of marketable debt securities | 1,047 | 15,858 |
Proceeds from promissory note | 0 | 300 |
Proceeds form dispositions of property and other assets, net | 452 | 0 |
Capital expenditures | (3,919) | (4,231) |
Net cash (used in) provided by investing activities | (2,077) | (19,666) |
Cash flows from financing activities | ||
Proceeds from issuance of common stock from public offering, net | 0 | 35,135 |
Proceeds from issuance of common stock and warrants from private offering | 0 | 5,500 |
Repayment of common stock for payment of statutory taxes on cashless exercise of stock options | (7,474) | 0 |
Repayment of note payable | (7,044) | (45) |
Repurchases of common shares | (2,152) | (917) |
Payment of dividends | (9,353) | (4,546) |
Net cash (used in) provided by financing activities | (26,023) | 35,127 |
Increase in cash, cash equivalents and restricted cash | 451 | 1,842 |
Cash, cash equivalents and restricted cash, at the beginning of the year | 8,658 | 6,816 |
Cash, cash equivalents and restricted cash, at the end of the year | 9,109 | 8,658 |
Supplemental disclosures: | ||
Cash paid for income taxes | 1,696 | 0 |
Interest payment on the promissory notes | 763 | 1,000 |
Supplemental disclosure of non-cash investing and financing activities: | ||
Issuance of common shares related to business acquisition | 0 | 3,608 |
Issuance of common shares for debt conversion | 600 | 0 |
Net unrealized loss, investments in marketable debt securities | 1,294 | (164) |
Recognize additional goodwill related to deferred tax liability | $ 0 | $ 362 |
Organization and Business
Organization and Business | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Business | Organization and Business ProPhase Labs, Inc. (“ProPhase”, “we”, “us”, “our” or the “Company”) is a growth oriented and diversified company focused on diagnostic and genomic products and services, the development and commercialization of novel drugs, dietary supplements, and compounds, and contract manufacturing. Until late fiscal year 2020, the Company was engaged primarily in the research, development, manufacture, distribution, marketing and sale of over-the-counter ("OTC") consumer healthcare products and dietary supplements in the United States. In October 2020, the Company completed the acquisition of all of the issued and outstanding shares of capital stock of Confucius Plaza Medical Laboratory Corp. (“CPM”), which owned a 4,000 square foot CLIA accredited laboratory located in Old Bridge, New Jersey for approximately $2.5 million, and began offering COVID-19 diagnostic tests through our wholly-owned subsidiary, ProPhase Diagnostics, Inc. ("ProPhase Diagnostics") in December 2020. Also in December 2020, we expanded our diagnostic service business with the build-out of a second, larger CLIA accredited laboratory in Garden City, New York. Operations at this second facility commenced in January 2021. We currently offer a broad array of COVID-19 related clinical diagnostic and testing services including polymerase chain reaction (“PCR”) testing for COVID-19 and Influenza A and B through ProPhase Diagnostics, as well as rapid antigen and antibody/immunity testing for COVID-19. In August 2021, we acquired Nebula Genomics, Inc. (“Nebula Genomics”), a privately owned personal genomics company, through our wholly-owned subsidiary, ProPhase Precision Medicine Inc. (“ProPhase Precision”). Nebula Genomics focuses on genomics sequencing technologies, a comprehensive method for analyzing entire genomes, including the genes and chromosomes in DNA. The data obtained from genomic sequencing can be used to help identify inherited disorders and tendencies, help predict disease risk, help identify expected drug response, and characterize genetic mutations, including those that drive cancer progression. The Company's wholly owned subsidiary, ProPhase BioPharma, Inc. (“PBIO”), was formed in June 2022, for the licensing, development and commercialization of novel drugs, dietary supplements and compounds. Licensed compounds currently include Equivir (OTC/dietary supplement) and Equivir G (Rx), two broad-based anti-virals, and Linebacker LB-1 and LB-2, two small molecule PIM kinase inhibitors. The Company also own the exclusive rights to the BE-Smart Esophageal Pre-Cancer Diagnostic Screening test and related IP assets. In connection with the activities of PBIO, in January 2023, the Company acquired exclusive rights to BE-Smart Esophageal Pre-Cancer Diagnostic Screening test and related IP assets. The BE-Smart test is focused on the early detection of esophageal cancer, and is intended to provide health care providers and patients with data to help determine treatment options. The development of these novel drugs and compounds is highly dependent on how each performs during the testing and development stage, the demand for these product and services once entered into the marketplace, our marketing and service capabilities and our ability to comply with applicable regulatory requirements. The Company's wholly-owned subsidiary, Pharmaloz Manufacturing, Inc. (“PMI”), is a full-service contract manufacturer and private label developer of a broad range of non-GMO, organic and natural-based cough drops and lozenges and OTC drug and dietary supplement products. The Company also develops and markets dietary supplements under the TK Supplements® brand. The TK Supplements ® product line includes Legendz XL ® , a male sexual enhancement and Triple Edge XL ® , an energy and stamina booster. The Company continues to actively pursue acquisition opportunities for other companies, technologies and products within and outside the consumer products industry. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to the current period presentation. These reclassifications had no effect on the reported results of operations. Segments In accordance with the Financial Accounting Standards Board's ("FASB") Accounting Standards Codification ("ASC") 280, “Segment Reporting” (“ASC 280”), the Company discloses financial and descriptive information about its reportable operating segments. Operating segments are components of an enterprise about which separate financial information is available and regularly evaluated by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company follows ASC 280, which establishes standards for reporting information about operating segments in annual and interim financial statements, and requires that companies report financial and descriptive information about their reportable segments based on a management approach. ASC 280 also establishes standards for related disclosures about products and services, geographic areas and major customers. Operating segments are defined as components of an enterprise that engage in business activities for which separate financial information is available and is evaluated by the Chief Operating Decision Maker (“CODM”), which for the Company is its Chief Executive Officer, in deciding how to allocate resources and assess performance. We maintain two operating segments: diagnostic services (which includes our COVID-19 and other diagnostic testing services) and consumer products (which includes our contract manufacturing, retail customers, biopharma and personal genomics products and services). See Note 15 Segment Information. Business and Liquidity Risks and Uncertainties Our diagnostic service business is and will continue to be impacted by the level of demand for COVID-19 and other diagnostic testing, how long this demand persists, the prices we are able to receive for performing our testing services, our ability to collect payment or reimbursement for our testing services, as well as the availability of COVID-19 testing from other laboratories and the period of time for which we are able to serve as an authorized laboratory offering COVID-19 testing under various Emergency Use Authorizations. While our revenues increased significantly for the year ended December 31, 2022 as a result of the diagnostic services business line, we have made and will continue to make substantial investments to secure the necessary equipment, supplies and personnel to provide these testing services. Our customer base for our COVID-19 tests is principally comprised of governmental bodies, municipalities, and large corporations who pay us directly or through third-party payers. While our revenues increased significantly since the launch of our diagnostic services business, we have been dependent on both government agency and insurance company reimbursement as well as the prevalence of COVID-19 associated strains. In March 2020, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), was enacted, providing for reimbursement to healthcare providers for COVID-19 tests provided to uninsured individuals, subject to continued available funding. On March 22, 2022, the Health Resources & Services Administration (HRSA) program stopped accepting claims for COVID-19 testing and treatment due to lack of sufficient funds. As a result of the suspension of the HRSA uninsured program, we have not recognized any revenue related to COVID-19 testing that we performed for uninsured individuals from March 22, 2022 through December 31, 2022. Our personal genomics business is and will continue to be influenced by demand for our genetic sequencing products and services, our marketing and service capabilities, and our ability to comply with applicable regulatory requirements. Our contracting manufacturing business is and will continue to be impacted by demand for our services, which is largely a function of the timing, length and severity of each cold season. Generally, a cold season is defined as the period from September to March when the incidence of the common cold rises as a result of the change in weather and other factors. We generally experience in the first, third and fourth quarter higher levels of net revenues from our contract manufacturing business. Revenues are generally at their lowest levels in the second quarter when customer demand generally declines. Our consumer sales are and will continue to be impacted by (i) the timing of acceptance of our TK Supplements ® consumer products in the marketplace, and (ii) fluctuations in the timing of purchase and the ultimate level of demand for these products. For the year ended December 31, 2022, $28.6 million was provided by operating activities. The Company had cash, cash equivalents and marketable securities of $17.4 million as of December 31, 2022. Based on management’s current business plans, the Company estimates that it will have enough cash and liquidity to finance its operating requirements for at least one year from the date of filing these financial statements. However, due to the nature of the diagnostic business and the Company's focus thus far on COVID-19, there are inherent uncertainties associated with managements’ business plan and cash flow projections if the Company is unable to grow its diagnostic testing business beyond COVID-19 testing services and to grow its other businesses. As such, the Company’s future capital needs and the adequacy of its available funds will depend on many factors. These include, but not necessarily limited to, the actual cost and time necessary to achieve sustained profitability from diagnostic services, the ability to successfully diversify the diagnostic services revenue streams and the ability to market and grow the personal genomics, biopharma, manufacturing and supplement businesses. The Company may be required to raise additional funds through equity or debt securities offerings or strategic collaboration and/or licensing agreements in order to fund operations until it is able to generate enough revenues. Such financing may not be available on acceptable terms, or at all, and the Company’s failure to raise capital when needed could have a material adverse effect on its strategic objectives, results of operations and financial condition. Use of Estimates The preparation of financial statements and the accompanying notes thereto, in conformity with generally accepted accounting principles in the United States of America (“GAAP”), requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the respective reporting periods. Examples include revenue recognition and the impact of the variable consideration around diagnostic test reimbursement rates, the provision for uncollectible receivables and billing errors, sales returns and allowances, rates, slow moving, dated inventory and associated provisions, the estimated useful lives and potential impairment of long-lived assets, stock based compensation valuation, income tax asset valuations and assumptions related to accrued advertising. Our estimates and assumptions are based on historical experience, current trends and other factors that management believes to be relevant at the time the financial statements are prepared. Management reviews the accounting policies, assumptions, estimates and judgments on a quarterly basis. Actual results could differ from those estimates. Cash and Cash Equivalents We consider all highly liquid investments with a maturity of three months or less at the time of purchase to be cash equivalents. Cash equivalents include cash on hand and monies invested in money market funds. The carrying amount approximates the fair market value due to the short-term maturity of these securities. Restricted Cash Restricted cash as of December 31, 2022 and 2021 includes approximately $250,000 held in escrow related to a potential purchase of an additional lab facility. The Company fully reserved for this amount in Fiscal 2022. Marketable Debt Securities We have classified our investments in marketable debt securities as available-for-sale and as a current asset. Our investments in marketable debt securities are carried at fair value, with unrealized gains and as a separate component of stockholders’ equity. Realized gains and losses from our marketable debt securities are recorded as interest income (expense). These investments in marketable debt securities carry maturity dates between one and three years from date of purchase and interest rates of 1.40% to 4.90% during fiscal 2022. The following is a summary of the components of our marketable debt securities and the underlying fair value input level tier hierarchy (see fair value of financial instruments) (in thousands): As of December 31, 2022 Amortized Unrealized Unrealized Fair U.S. government obligations $ 1484 $ 6 $ (12) $ 1478 Corporate obligations 5,702 1,228 (80) 6,850 $ 7,186 $ 1,234 $ (92) $ 8,328 As of December 31, 2021 Amortized Unrealized Unrealized Fair U.S. government obligations $ 650 $ 17 $ — $ 667 Corporate obligations 8,304 — (192) 8,112 $ 8,954 $ 17 $ (192) $ 8,779 We believe that the unrealized gains or losses generally are the result of a change in the risk premiums required by market participants rather than an adverse change in cash flows or a fundamental weakness in the credit quality of the issuer or underlying assets. Marketable Equity Securities Marketable equity securities are recorded at fair value in the consolidated balance sheets. The change in fair value of marketable equity securities is recognized within other non-operating income, net in the consolidated statements of income. On June 25, 2021, we were issued 1,260,619 common shares (the “Investment Shares”) as an interest payment under our note receivable (see Note 13, Consulting Agreement and Secured Promissory Note Receivable) with a fair value of $315,000 and a fair value of $76,000 and $0 at December 31, 2021 and 2022, respectively. The investment was classified as a Level 1 financial instrument. We recorded a $76,000 decrease in fair value of investment securities within the statement of operations for the year ended December 31, 2022. Accounts Receivable, net Accounts receivable consists primarily of amounts due from government agencies and healthcare insurers. Unbilled accounts receivable relates to the delivery of our diagnostic testing services for which the related billings will occur in a future period, after a patient’s insurance information has been validated, and represent amounts we have an unconditional right to receive payment. Unbilled accounts receivable is classified as accounts receivable on the consolidated balance sheet. We carry our accounts receivable at the amount of consideration for which we expect to be entitled less allowances. When estimating the allowances for our diagnostics business, the Company pools its trade receivables based on the following payer types: healthcare insurers and government payers. The Company principally estimates the allowance for credit losses by pool based on historical collection experience, current economic conditions, expectations of future economic conditions, other credits and the period of time that the receivables have been outstanding. To the extent that any individual payers are identified that have deteriorated in credit quality, the Company removes the payers from their respective pools and establishes allowances based on the individual risk characteristics of such payers. On a periodic basis, we evaluate our receivables and establish an allowance, based on a history of past write-offs, government and healthcare insurer payment trends, collections, current credit conditions or generally accepted future trends. Accounts are written off as uncollectible at the time we determine that collections are unlikely. Accounts receivable, net is comprised of the following (in thousands): December 31, 2022 December 31, 2021 Trade accounts receivable $ 37,568 $ 18,520 Unbilled accounts receivable 2,626 23,089 40,194 41,609 Less allowances (3,140) (3,901) Total accounts receivable $ 37,054 $ 37,708 For Fiscal 2022, we recorded $5.9 million to bad debt expense in operating expenses representing a write-off of trade receivables we have determined to be uncollectible. Additionally, we wrote off $2.9 million of trade receivables and related allowances at December 31, 2022, that were fully reserved for in 2021 and did not impact the result of operations for the year ended December 31, 2022. The Company also increased its allowance for doubtful accounts in Fiscal 2022 by $5.5 million. The results of these adjustments and our current year allowances, resulted in an allowance of $3.1 million at December 31, 2022. For Fiscal 2021, we recorded $3.9 million to the allowance with a corresponding charge to net revenues with no write-off to bad debt expense in 2021. Inventory, net Inventory is valued at the lower of cost, determined on a first-in, first-out basis (“FIFO”), or net realizable value. Inventory items are analyzed to determine cost and the net realizable value and appropriate valuation adjustments are established. At December 31, 2022 and 2021, the components of inventory are as follows (in thousands): December 31, December 31, Diagnostic services testing material $ 1,739 $ 2,989 Raw materials 1,639 1,514 Work in process 754 260 Finished goods 356 272 Inventory $ 4,488 $ 5,035 Inventory valuation reserve (512) (435) Inventory, net $ 3,976 $ 4,600 Property, Plant and Equipment Property, plant and equipment are recorded at cost. We use the straight-line method in computing depreciation for financial reporting purposes. Depreciation expense is computed in accordance with the following ranges of estimated asset lives: building and improvements - ten three three Concentration of Financial Risks Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash investments, marketable debt securities, and trade accounts receivable. Our marketable securities are fixed income investments, which are highly liquid and can be readily purchased or sold through established markets. We maintain cash and cash equivalents with certain major financial institutions. As of December 31, 2022, our cash and cash equivalents and restricted cash balance was $9.1 million. Of the total bank balance, $1.0 million was covered by federal depository insurance and $8.4 million was uninsured at December 31, 2022. Accounts receivable subject us to credit risk concentrations from time-to-time. We extend credit to our consumer healthcare product customers based upon an evaluation of the customer’s financial condition and credit history and generally do not require collateral. Our diagnostic services receivable credit risk is based on payer reimbursement experience, which includes government agencies and healthcare insurers, the period the receivables have been outstanding and the historical collection rates. The collectability of the diagnostic services receivables is also directly linked to the quality of our billing processes, which depend on information provided and billing services of third parties. These credit concentrations impact our overall exposure to credit risk, which could be further affected by changes in economic, regulatory or other conditions that may impact the timing and collectability of trade receivables and diagnostic test receivables. Additionally, the reimbursement receivables from the diagnostic service business are subject to billing errors and related disputes. We also assess the financial condition of the debtor under our note receivable (see Note 13, Consulting Agreement and Secured Promissory Note Receivable and Consulting Agreement), balances due to us. As of December 31, 2022 and the financial statements reporting date, the Company did not expect full realization upon maturity. In addition, see Note 14 - Significant Customers Concentrations. Leases At the inception of an arrangement, we determine whether the arrangement is or contains a lease based on the unique facts and circumstances present in the arrangement. Most leases with a term greater than one year are recognized on the balance sheet as right-of-use assets and short-term and long-term lease liabilities, as applicable. We have elected not to recognize on the balance sheet leases with terms of 12 months or less. We typically only include an initial lease term in its assessment of a lease arrangement. Options to renew a lease are not included in our assessment unless there is reasonable certainty that we will renew. Operating lease liabilities and their corresponding right-of-use assets are recorded based on the present value of lease payments over the expected remaining lease term. Certain adjustments to the right-of-use asset may be required for items such as incentives received. The interest rate implicit in our leases is typically not readily determinable. As a result, we utilize our incremental borrowing rate, which reflects the fixed rate at which we could borrow on a collateralized basis the amount of the lease payments in the same currency, for a similar term and in a similar economic environment (see Note 12, Leases). The components of a lease should be allocated between lease components ( e.g ., land, building, etc.) and non-lease components ( e.g ., common area maintenance, consumables, etc.). The fixed and in-substance fixed contract consideration (including any consideration related to non-components) must be allocated based on the respective relative fair values to the lease components and non-lease components. Goodwill and Intangible Assets Goodwill represents the excess of the fair value of the consideration transferred over the fair value of the underlying identifiable assets and liabilities acquired in a business combination. Goodwill and intangible assets deemed to have an indefinite life are not amortized, but instead are assessed for impairment annually. Additionally, if an event or change in circumstances occurs that would more likely than not reduce the fair value of the reporting unit below its carrying value, we would evaluate goodwill and other intangibles at that time. In testing for goodwill impairment, we have the option to first assess qualitative factors to determine whether the existence of events or circumstances lead to a determination that it is more likely than not that the fair value of the reporting unit is less than its carrying amount. If, after assessing the totality of events and circumstances, we conclude that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test is not required. If we conclude otherwise, we are required to perform the two-step impairment test. The goodwill impairment test is performed at the reporting unit level by comparing the estimated fair value of a reporting unit with its respective carrying value. If the estimated fair value exceeds the carrying value, goodwill at the reporting unit level is not impaired. If the estimated fair value is less than the carrying value, an impairment charge will be recorded to reduce the reporting unit to fair value. Management completed a qualitative assessment of Goodwill and it was not deemed impaired at December 31, 2022. Intangible assets deemed to have finite lives are amortized on a straight-line basis over their estimated useful lives, where the useful life is the period over which the asset is expected to contribute directly, or indirectly, to our future cash flows. Impairment of Long-Lived Assets The Company reviews long-lived assets, including property and equipment and finite-lived intangible assets, for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. An impairment loss is recognized when the asset’s carrying value exceeds the total undiscounted cash flows expected from its use and eventual disposition. The amount of the impairment loss is determined as the excess of the carrying value of the asset over its fair value. For the fiscal years ended December 31, 2022 and 2021, the Company did not have an impairment of the long-lived assets. Fair Value of Financial Instruments We measure assets and liabilities at fair value based on expected exit price as defined by the authoritative guidance on fair value measurements, which represents the amount that would be received on the sale date of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value: • Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. • Level 2: Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. • Level 3: Unobservable inputs reflecting the Company’s assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. The carrying amounts of our financial assets and liabilities, such as cash, accounts receivable, accounts payable, and unsecured note payable, approximate their fair values because of the short-term nature of these instruments. We account for our marketable securities at fair value, with the net unrealized gains or losses of marketable debt securities reported as a component of accumulated other comprehensive income or loss and marketable equity securities change in fair value reported on the condensed consolidated statement of operations. The components of marketable securities are as follows (in thousands): As of December 31, 2022 Level 1 Level 2 Level 3 Total U.S. government obligations $ — $ 1,478 $ — $ 1,478 Corporate obligations 5,497 1,354 — 6,851 $ 5,497 $ 2,832 $ — $ 8,329 As of December 31, 2021 Level 1 Level 2 Level 3 Total U.S. government obligations $ — $ 667 $ — $ 667 Corporate obligations — 8,112 — 8,112 Marketable equity securities 76 — — 76 $ 76 $ 8,779 $ — $ 8,855 There were no transfers of marketable debt securities between Levels 1, 2 or 3 for the years ended December 31, 2022 and 2021. Revenue Recognition We recognize revenue that represents the transfer of promised goods or services to customers at an amount that reflects the consideration that is expected to be received in exchange for those goods or services. We recognize revenue when performance obligations with our customers have been satisfied. At contract inception, we evaluate the contract to determine if revenue should be recognized using the following five steps: (1) identify the contract with the customer; (2) identify the performance obligations; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations; and (5) recognize revenue when (or as) the entity satisfies a performance obligation. Contract with Customers and Performance Obligations A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. Sales from product shipments to contract manufacturing and retailer customers are recognized at the time ownership is transferred to the customer. Revenue from diagnostic services is recognized when the results are made available to the customer. Revenue from our personal genomics business is recognized when the genetic testing results are provided to the customer. For subscription services associated with our genomic testing, we recognize revenue ratably over the term of the subscription. The Company’s performance obligation for contract manufacturing and retail customers is to provide the goods ordered by the customer. The Company has one performance obligation for its diagnostic services, which is to provide the results of the laboratory test to the customer. Our personal genomics business has separate performance obligations to provide initial testing and genome results and subscriptions services to our customers. Transaction Price For our diagnostic services business, a revenue transaction is initiated when we receive a requisition order to perform a diagnostic test. The information provided on the requisition form is used to determine the party that will be billed for the testing performed and the expected reimbursement. We provide diagnostic services to a range of customers. In many cases, the customer that orders our services is not responsible for paying for these services. Depending on the billing arrangement and applicable law, the payer may be the patient or a third party, such as a health plan, Medicare or Medicaid program and other government reimbursement programs. We bill the providers at standard price and take into consideration negotiated discounts and anticipated reimbursement remittance adjustments based on the payer portfolio, when revenue is recorded. We use the most expected value method to estimate the transaction price for reimbursements that vary from the listed contract price. For our personal genomics business, a revenue transaction is initiated by a DNA test kit sale direct to the consumer sales via our website or through online retailers. The kit sales and subscriptions are billed at a standard price and take into consideration any discounts when revenue is recorded. We also contract with third party B2B partners and universities and sell DNA test kits directly to them. For contract manufacturing and retail customers, the transaction price is fixed based upon either (i) the terms of a combined master agreement and each related purchase order, or (ii) if there is no master agreement, the price per individual purchase order received from each customer. The customers are invoiced at an agreed upon contractual price for each unit ordered and delivered by the Company. Revenue from retail customers is reduced for trade promotions, estimated sales returns and other allowances in the same period as the related sales are recorded. No such allowance is applicable to our contract manufacturing customers. We estimate potential future product returns and other allowances related to current period revenue. We analyze historical returns, current trends, and changes in customer and consumer demand when evaluating the adequacy of the sales returns and other allowances. We do not accept returns from our contract manufacturing customers. Our return policy for retail customers accommodates returns for (i) discontinued products, (ii) store closings and (iii) products that have reached or exceeded their designated expiration date. We do not impose a period of time during which product may be returned. All requests for product returns must be submitted to us for pre-approval. We will not accept return requests pertaining to customer inventory “Overstocking” or “Resets”. We will accept return requests only for products in their intended package configuration. We reserve the right to terminate shipment of product to customers who have made unauthorized deductions contrary to our return policy or pursue other methods of reimbursement. We compensate the customer for authorized returns by means of a credit applied to amounts owed. For our diagnostic services business, a revenue transaction is initiated when we receive a requisition order to perform a diagnostic test. The information provided on the requisition form is used to determine the party that will be billed for the testing performed and the expected reimbursement. We provide diagnostic services to a range of customers. In many cases, the customer that orders our services is not responsible for paying for these services. Depending on the billing arrangement and applicable law, the payer may be the patient or a third party, such as a health plan, Medicare or Medicaid program and other government reimbursement programs. We bill the providers at standard price and take into consideration negotiated discounts and anticipated reimbursement remittance adjustments based on the payer portfolio, when revenue is recorded. We use the most expected value method to estimate the transaction price for reimbursements that vary from the listed contract price. For our personal genomics business, a revenue transaction is initiated by a DNA test kit sale direct to the consumer sales via our website or through online retailers. The kit sales and subscriptions are billed at a standard price and take into consideration any discounts when revenue is recorded. We also contract with third party B2B partners and universities and sell DNA test kits directly to them. Recognize Revenue When the Company Satisfies a Performance Obligation For diagnostic services, the Company satisfies its performance obligation at the point in time that the results are made available to the customer, which is when the customer benefits from the information contained in the results and obtains control. For genomic services, we satisfy our product performance obligation at a point in time when the genetic testing results are provided to the customer. For subscriptions services associated with its genomic testing, we satisfy our performance obligation ratably over the subscription period. If the customer does not return the test kit, services cannot be completed by us, potentially resulting in unexercised rights (“breakage”) revenue, including lifetime subscription services. We estimate breakage for the portion of test kits not expected to be returned using an analysis of historical data and consider other factors that could influence customer test kit return behavior. When breakage revenue is recognized on a kit, we recognize breakage on any associated subscription services ratably over the term of the subscription . The Company recognized breakage revenue from aggregate unreturned test kits and subscriptions of $1.0 million for the year ended December 31, 2022. Performance obligations related to contract manufacturing and retail customers are satisfied at a point in time when the goods are shipped to the customer as (i) we have transferred control of the assets to the customers upon shipping, and (ii) the customer obtains title and assumes the risks and rewards of ownership after the goods are shipped. Contract Balances As of December 31, 2022 and December 31, 2021, we have deferred revenue of $3.6 million and $2.9 million, respectively. Our new personal genomics business comprised $3.5 million of the deferred revenue as of December 31, 2022. The remainder of deferred revenue relates to research and development (“R&D”) stability and release testing programs recognized as contract manufacturing revenue. Deferred revenues primarily consist of amounts that have been billed to or received from customers in advance of revenue recognition and prepayments received from customers in advance of services performed for the R&D work. We recognize deferred revenues as revenues when the services are performed and the corresponding revenue recognition criteria are met. Customer prepayments are generally applied against invoices issued to customers when services are performed and billed. The following table disaggregates our deferred revenue by recognition period (in thousands): As of |
Business Acquisitions
Business Acquisitions | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Acquisitions | Business Acquisitions Nebula Acquisition On August 10, 2021 (the “Effective Date”), the Company and its wholly owned subsidiary, ProPhase Precision, entered into and closed a Stock Purchase Agreement (the “Nebula Stock Purchase Agreement”) with Nebula Genomics, each of the stockholders of Nebula Genomics (the “Seller Parties”), and Kamal Obbad, as Seller Party Representative. Pursuant to the terms of the Nebula Stock Purchase Agreement, ProPhase Precision acquired all of the issued and outstanding shares of common stock of Nebula Genomics from the Seller Parties, for an aggregate purchase price of approximately $14.6 million, subject to post-closing adjustments (the “Nebula Acquisition”). A portion of the purchase price equal to $3.6 million was paid in shares of the Company’s common stock to certain Seller Parties and noteholders of Nebula Genomics, based on their election to receive shares of the Company’s common stock in lieu of cash, which shares were valued at a price per share of $7.46, which is equal to the average closing price of the Company’s common stock on Nasdaq for the five trading days preceding the signing of the Nebula Stock Purchase Agreement. A portion of the purchase price equal to $1,080,000 (the “Escrow Amount”) was held in escrow by Citibank, N.A. (the “Escrow Agent”) until February 23, 2023 (“Escrow Termination Date”), pursuant to the terms and conditions of an escrow agreement ("Escrow Agreement") entered into with the Escrow Agent, as security for the indemnification obligations of the Seller Parties. In connection with the Nebula Acquisition, ProPhase Precision entered into an employment agreement with Kamal Obbad, the Chief Executive Officer of Nebula Genomics, on the Effective Date, pursuant to which Mr. Obbad serves as Senior Vice President, Director of Sales and Marketing of ProPhase Precision Medicine, Inc. As a condition to the employment agreement, Mr. Obbad was awarded a stock option to purchase 250,000 shares of Company common stock at an exercise price equal to $7.67 per share, the closing price of the Company's common stock on the Effective Date. The award was issued as a material inducement to Mr. Obbad’s acceptance of employment with ProPhase Precision in accordance with Nasdaq Listing Rule 5635(c)(4) and was approved by the Company’s Compensation Committee (see Note 7, Stockholders’ Equity). Based on the preliminary valuation, the total consideration of $12.7 million, which is net of $1.6 million in cash acquired and $0.3 million anticipated to be paid back to the Company from the Escrow Amount, has been allocated to assets acquired and liabilities assumed based on their respective fair values as follows (in thousands): Account Amount Short term investments $ 1,800 Accounts receivable 222 Inventory 82 Prepaid and other current assets 379 Definite-lived intangible assets 10,990 Total assets acquired 13,473 Accounts payable (805) Accrued expenses and other current liabilities (43) Deferred revenue (2,391) Note payable (81) Deferred tax liability (1,925) Total liabilities assumed (5,245) Net identifiable assets acquired 8,228 Goodwill 4,446 Total consideration, net of cash acquired (1) $ 12,674 (1) Net of $1.6 million cash acquired and $0.3 million anticipated amounts due back to the Company from the escrow account. On March 8, 2023, pursuant to the terms of the Escrow Agreement, the Company received a $0.5 million payment as a return of a portion of the purchase price. The remainder of the escrow of $0.6 million was disbursed to the Sellers of Nebula Genomics. The Company recorded measurement period adjustments during Fiscal 2021 to (a) increase deferred revenue and increase goodwill related to the adoption of ASU 2021-08, (b) increase inventory and increase accounts payable for additional accounts payable invoices that arose subsequent to the third quarter of 2021, (c) increase inventory and decrease goodwill for adjustments to the inventory valuation as of the acquisition date, (d) increase deferred tax liability and increase goodwill, and (e) decrease accounts receivable and increase goodwill to for adjustments to the accounts receivable valuation as of the acquisition date. Goodwill represents the excess of the purchase price over the net identifiable tangible and intangible assets acquired. The Company believes the goodwill related to the acquisition was a result of the expected synergies to be realized from combining operations and is not deductible for income tax purposes. The preliminary purchase price allocation is adjusted, as necessary, up to one year after the acquisition closing date if management obtains more information regarding asset valuations and liabilities assumed. The intangible assets preliminarily identified in conjunction with the Nebula Acquisition are as follows (in thousands): Gross Carrying Value Estimated Useful Trade names $ 5,550 15 Proprietary intellectual property 4,260 5 Customer relationships 1,180 1 Total $ 10,990 The Company recognized $1.9 million and $0.9 million amortization expense on the above identified intangible assets during the year ended December 31, 2022 and 2021, respectively. Pro Forma Results The following table summarizes, on a pro forma basis, the combined results of the Company as though the Nebula Acquisition had occurred as of January 1, 2021. These pro forma results are not necessarily indicative of the actual consolidated results had the acquisition occurred as of that date or of the future consolidated operating results for any period. Pro forma results are (in thousands): For the year ended December 31, 2021 Revenue, net $ 81,164 Net income (loss) $ 6,135 |
Goodwill and Acquired Intangibl
Goodwill and Acquired Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Acquired Intangible Assets | Goodwill and Acquired Intangible Assets Goodwill Changes in goodwill for Fiscal 2022 are as follows (in thousands): Amount Goodwill, beginning of Fiscal 2021 $ 901 Acquisition of Nebula 4,446 Adjustment for deferred tax liability 362 Goodwill, end of Fiscal 2021 5,709 Goodwill, end of Fiscal 2022 $ 5,709 Intangible Assets, Net Intangible assets as of December 31, 2022 and 2021 consisted of the following (in thousands): December 31, December 31, Estimated Useful Trade names $ 5,550 $ 5,550 15 Proprietary intellectual property 4,260 4,260 5 Customer relationships 1,180 1,180 1 CLIA license 1,307 1,307 3 12,297 12,297 Less: accumulated amortization (3,822) (1,445) Total intangible assets, net $ 8,475 $ 10,852 Amortization expense for acquired intangible assets was $2.4 million and $1.4 million during the years ended December 31, 2022 and 2021, respectively. The estimated future amortization expense of acquired intangible assets as of December 31, 2022 is as follows (in thousands): Year ended December 31, 2023 $ 1,585 Year ended December 31, 2024 1,222 Year ended December 31, 2025 1,222 Year ended December 31, 2026 890 Year ended December 31, 2027 370 Thereafter 3,186 $ 8,475 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, Plant and Equipment The components of property, plant and equipment are as follows (in thousands): December 31, December 31, Estimated Useful Life Land $ 352 $ 352 Building improvements 1,729 1,729 10-39 years Machinery 5,048 4,740 3-7 years Lab equipment 5,788 4,330 3-7 years Computer equipment and software 2,350 1,211 3-5 years Furniture and fixtures 461 468 5 years 15,728 12,830 Less: accumulated depreciation (8,440) (6,883) Total property, plant and equipment, net $ 7,288 $ 5,947 Depreciation expense for Fiscal 2022 and 2021 were $2.3 million and $1.9 million, respectively. |
Unsecured Convertible Promissor
Unsecured Convertible Promissory Notes Payable | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Unsecured Convertible Promissory Notes Payable | Unsecured Convertible Promissory Notes Payable On September 15, 2020, we issued two unsecured, partially convertible, promissory notes (the “September 2020 Notes”) for an aggregate principal amount of $10 million to two investors (collectively, the “Lenders”). On February 28, 2022, we entered into a letter agreement (the “Letter Agreement”) with one of the Lenders providing for the payoff of its September 2020 Note in the principal amount of $2,000,000. Pursuant to the terms of the Letter Agreement, (i) the Lender converted $600,000 of the principal amount due to him under his September 2020 Note into 200,000 shares of Company common stock (the “Conversion Shares”) at a price of $3.00 per share as provided for under the terms of the September 2020 Note (the “Conversion”), (ii) the Company paid to the Lender $1,440,548 in cash, representing $1,400,000 of the remaining principal under the September 2020 Note following the Conversion plus $40,548 in accrued and outstanding interest under the September 2020 Note, and (iii) the Company repurchased the Conversion Shares at a price of $5.75 per share for an aggregate amount of $1,150,000 (for a total aggregate payment to the Lender of $2,590,548). The September 2020 Note that remains outstanding is due and payable on September 15, 2023 and accrues interest at a rate of 10% per year from the closing date, payable on a quarterly basis, until the September 2020 Note is repaid in full. We have the right to prepay the September 2020 Note at any time after providing written notice to the Lender and may prepay the September 2020 Note prior to such time with the consent of the Lender. The Lender has the right, at any time, and from time to time, to convert up to an aggregate of $3.0 million of the September 2020 Note into common stock of the Company at a conversion price of $3.00 per share. Repayment of the outstanding September 2020 Note has been guaranteed by our wholly owned subsidiary, PMI. In November 2022, the Company paid back $5.6 million in principal on the remaining September 2020 Note. The September 2020 Note contains customary events of default. If a default occurs and is not cured within the applicable cure period or is not waived, any outstanding obligations under the September 2020 Note may be accelerated. The September 2020 Note also contains certain restrictive covenants which, among other things, restrict the Company's ability to create, incur, assume or permit to exist, directly or indirectly, any lien (other than certain permitted liens described in the September 2020 Note) securing any indebtedness of the Company, and prohibits the Company from distributing or reinvesting the proceeds from any divestment of assets (other than in the ordinary course) without the prior approval of the Lender. For the year ended December 31, 2022 and 2021, we incurred $0.8 million and $1.0 million, respectively, in interest expense under the September 2020 Notes. |
Stockholders_ Equity
Stockholders’ Equity | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Stockholders’ Equity | Stockholders’ Equity Our authorized capital stock consists of 50 million shares of common stock, $0.0005 par value, and one million shares of preferred stock, $0.0005 par value. Preferred Stock The preferred stock authorized under the Company's certificate of incorporation may be issued from time to time in one or more series. As of December 31, 2022, no shares of preferred stock have been issued. The Company's board of directors have the full authority permitted by law to establish, without further stockholder approval, one or more series of preferred stock and the number of shares constituting each such series and to fix by resolution voting powers, preferences and relative, participating, optional and other special rights of each series of preferred stock, and the qualifications, limitations or restrictions thereof, if any. Subject to the limitation on the total number of shares of preferred stock that the Company has authority to issue under its certificate of incorporation, the board of directors is also authorized to increase or decrease the number of shares of any series, subsequent to the issue of that series, but not below the number of shares of such series then-outstanding. In case the number of shares of any series is so decreased, the shares constituting such decrease will resume the status that they had prior to the adoption of the resolution originally fixing the number of shares of such series. The Company may, subject to any required stockholder approval, amend from time to time its certificate of incorporation to increase the number of authorized shares of preferred stock or common stock or to make other changes or additions to our capital structure or the terms of our capital stock. Common Stock Dividends On May 9, 2022, the board of directors of the Company declared a special cash dividend of $0.30 per share on the Company’s common stock, paid on June 4, 2022, in the amount of $4.7 million to holders of record of the Company’s common stock as of May 25, 2022. On February 14, 2022, the board of directors of the Company declared a special cash dividend of $0.30 per share on the Company’s common stock, paid on March 10, 2022, in the amount of $4.6 million to holders of record of the Company’s common stock on March 1, 2022. During the year ended December 31, 2021, the Board declared a special cash dividend of $0.30 per share on the Company’s common stock to holders of record on May 25, 2021, resulting in the payment of $4.5 million to stockholders on June 3, 2021. Common Stock Registered Direct Offering On January 5, 2021, the Company entered into a securities purchase agreement with certain accredited investors and qualified institutional buyers, pursuant to which the Company issued and sold to the purchasers an aggregate of (i) 550,000 shares of the Company's common stock, and (ii) warrants to purchase up to 275,000 shares of the Company's common stock in a registered direct offering. The shares and warrants were sold at a purchase price of $10.00 per share for net proceeds to the Company of $5.5 million. Each Warrant has an exercise price equal to $11.00 per share of common stock, will be exercisable at any time and from time to time, subject to certain conditions described in the Warrant, after the date of issuance, and will expire on the date that is three years from the date of issuance. The Shares and the Warrants are immediately separable and were issued separately. Public Offering On January 18, 2021, the Company entered into an underwriting agreement for the public offering of three million shares of common stock, at a price to the public of $12.50 per share. On January 21, 2021, the Company completed the offering for net proceeds of $35.1 million, after deducting the underwriting discounts and commissions and estimated offering expenses. As part of the offering, the Company also issued to the underwriters warrants to purchase up to an aggregate of 180,000 shares of common stock (6% of the shares of common stock sold in the offering) at an exercise price of $15.625 per share (equal to 125% of the public offering price per share). At-the-market Offering On December 28, 2021, the Company entered into a Sales Agreement (the “Sales Agreement”) with ThinkEquity LLC (the “Sales Agent”), pursuant to which the Company may offer and sell, from time to time through the Sales Agent, shares (the “ATM Shares”) of the Company's common stock, having an aggregate offering price of up to $100,000,000, subject to the terms and conditions of the Sales Agreement. The Company is not obligated to make any sales of the ATM Shares under the Sales Agreement. The offering pursuant to the Sales Agreement will terminate upon the earlier of (i) the sale of all of the ATM Shares subject to the Sales Agreement and (ii) termination of the Sales Agreement as permitted therein. The Company may terminate the Sales Agreement in its sole discretion at any time by giving three business days’ prior notice to the Sales Agent. The Sales Agent may terminate the Sales Agreement under the circumstances specified in the Sales Agreement and in its sole discretion at any time by giving three business days’ prior notice to the Company. The Company will pay the Sales Agent a fixed commission rate of 2.0% of the aggregate gross proceeds from the sale of the ATM Shares pursuant to the Sales Agreement and has agreed to provide the Sales Agent with customary indemnification and contribution rights. The Company also agreed to reimburse the actual out-of-pocket accountable expenses of the Sales Agent up to $60,000 (of which a $25,000 advance was paid on December 7, 2021), which amount will include the fees and expenses of legal counsel to the Sales Agent up to $50,000, and to pay the costs associated with bound volumes of the public offering materials as well as commemorative mementos and lucite tombstones, in an amount not to exceed $3,000. Additionally, the Company will pay to H.C. Wainwright & Co. (“Wainwright”), a fee equal to 1.0% of the gross proceeds of the sales price of all the ATM Shares sold under the Sales Agreement, pursuant to a separate financial services agreement with Wainwright. Wainwright is not a sales agent under the Sales Agreement. For the years ended December 31, 2022 and 2021, the Company did not have any sales under the At-the-market Offering program. Nebula Acquisition As part of Nebula Acquisition (see Note 3, Business Acquisitions), a portion of the purchase price was paid in shares to certain Seller Parties and noteholders of Nebula G, based on their election to receive shares of the Company’s common stock in lieu of cash, which shares have been valued at a price per share of $7.46, which is equal to the average closing price of the Company’s common stock on Nasdaq for the five trading days preceding the signing of the Nebula Stock Purchase Agreement. The Company issued 483,685 shares of its common stock in in lieu of $3.6 million cash payment to Seller Parties and noteholders of Nebula. Stock Repurchase Program On July 26, 2022 and September 8, 2021, the Company announced that its board of directors (the “Board”) had approved new stock repurchase programs. Under each of the stock repurchase programs, the Company was authorized to repurchase up to $6.0 million million of its outstanding shares of common stock from time to time, over a six-month period. The Company repurchased 303,145 and 166,824 shares during the years ended December 31, 2022 and 2021, respectively, pursuant to the stock repurchase programs for an aggregate amount of $2,152,000 and $944,000 respectively, including commissions. The 2010 Directors’ Equity Compensation Plan On May 20, 2021, the stockholders of the Company approved the Amended and Restated 2010 Directors’ Equity Compensation Plan (the “Amended 2010 Directors’ Plan”) at the 2021 annual meeting of stockholders of the Company (the "2021 Annual Meeting"). The Amended 2010 Directors’ Plan authorizes the issuance of up to 775,000 shares of common stock. During the year ended December 31, 2021, stock options to purchase an aggregate of 225,126 shares of the Company's common stock were granted to the Company's directors in lieu of director fees under the Amended 2010 Directors’ Plan with a strike price of $5.28 per share. The 2022 Directors' Equity Compensation Plan On May 19, 2022, the stockholders of the Company approved the 2022 Directors' Equity Compensation Plan (the “2022 Directors' Plan”) at the 2022 annual meeting of stockholders (the "2022 Annual Meeting"). The 2022 Director's Plan amended and restated the Amended and Restated 2010 Directors' Equity Compensation Plan and provides for an increase in the number of shares reserved for issuance under the plan by 300,000 shares and provides for the adjustment of the per share exercise price of stock options granted under the 2022 Directors' Plan in the event of any change in the outstanding shares of common stock of the Company as a result of, among other things, any distribution or special dividend to stockholders of shares, cash or other property (other than regular cash dividends). At December 31, 2022, there were 120,000 stock options outstanding and there were 180,000 shares of common stock available to be issued under the 2022 Directors’ Plan. During the year ended December 31, 2022, stock options to purchase an aggregate of 120,000 shares of the Company's common stock were granted to our directors in lieu of director fees under the 2022 Plan with a strike price of $5.28 per share. The 2010 Equity Compensation Plan On May 20, 2021, the stockholders of the Company approved the Amended and Restated 2010 Equity Compensation Plan (the “Amended 2010 Plan”) at the 2021 Annual Meeting. The Amended 2010 Plan authorizes the issuance of up to 4,900,000 shares of common stock. During Fiscal 2021, 1,249,874 stock options were granted to our employees and non-employees under the 2010 Plan at an exercise price between $5.28 - $11.03, the closing price of the Company’s common stock on the date of grant, with 25% of the stock options vested on the grant date, and 75% vesting over a 3-year period in equal annually installments. The 2022 Equity Compensation Plan On May 19, 2022, the stockholders of the Company approved the 2022 Equity Compensation Plan (the “2022 Plan”) at the 2022 Annual Meeting. The 2022 Plan amended and restated the Company’s Amended and Restated 2010 Equity Compensation Plan and provides for an increase in the number of shares reserved for issuance under the plan by 1,000,000 shares for a total of 5,900,000 and provides for the adjustment of the per share exercise price of stock options granted under the 2022 Plan in the event of any change in the outstanding shares of common stock of the Company as a result of, among other things, any distribution or special dividend to stockholders of shares, cash or other property (other than regular cash dividends). During Fiscal 2022, 325,000 stock options were granted to the Company's employees and non-employees under the 2022 Plan at exercise prices between $8.96 and $12.01, equal to the closing price of the Company’s common stock on the date of grant, with 25% of each such stock option vested on the grant date, and 75% vesting over a 3-year period in equal annually installments. The 2018 Stock Incentive Plan On April 12, 2018, the Company's stockholders approved the 2018 Stock Incentive Plan (the “2018 Stock Plan”). The 2018 Stock Plan provides for the grant of incentive stock options to eligible employees of the Company, and for the grant of non-statutory stock options to eligible employees, directors and consultants. The purpose of the 2018 Stock Plan is to advance the interests of the Company and its stockholders by providing an incentive to attract, retain, and reward persons performing services for the Company and by motivating such persons to contribute to the growth and profitability of the Company. The 2018 Stock Plan provides that the total number of shares that may be issued pursuant to the 2018 Stock Plan is 2,300,000 shares. At April 12, 2018, all 2,300,000 shares had been granted in the form of stock options to Ted Karkus (the “CEO Option”), the Company's Chief Executive Officer, and, through December 31, 2022, 1,650,000 options under the 2018 Stock Plan had been exercised. The 2018 Stock Plan requires certain proportionate adjustments to be made to the stock options granted under the 2018 Stock Plan upon the occurrence of certain events, including a special distribution (whether in the form of cash, shares, other securities, or other property) in order to maintain parity. Accordingly, the Compensation Committee of the board of directors, as required by the terms of the 2018 Stock Plan, adjusted the terms of the CEO Option, such that the exercise price of the CEO Option was reduced from $3.00 per share to $2.00 per share, effective as of September 5, 2018, the date the special $1.00 special cash dividend was paid to stockholders. The exercise price of the CEO Option was further reduced from 2.00 $2.00 to $1.75 per share, effective as of January 24, 2019, the date the $0.25 special cash dividend was paid to stockholders. The exercise price of the CEO Option was further reduced from $1.75 to $1.50 per share, effective as of December 12, 2019, the date another $0.25 special cash dividend was paid to stockholders. The exercise price of the CEO Option was further reduced from $1.50 to $1.20 per share, effective as of June 3, 2021, the date another $0.30 special cash dividend was paid to Company’s stockholders. Accordingly, the Compensation Committee of the board of directors, as required by the terms of the 2018 Stock Plan, has adjusted the exercise price of the CEO Option in connection with each special cash dividend paid by the Company proportionately to the amount of the dividend paid. The current exercise price of the CEO Option is $0.60 per share after the latest special cash dividend paid on June 3, 2022. Inducement Option Awards As part of Nebula Acquisition, the Company issued a non-qualified stock option to Kamal Obbad, the Chief Executive Officer of Nebula Genomics, as an inducement to his employment with the Company (the “Obbad Award”). The Obbad Award entitles Mr. Obbad to purchase up to 250,000 shares of the Company’s common stock at an exercise price of $7.67 per share, the closing price of the Company’s common stock on the closing date of the Nebula Acquisition. The Obbad Award was granted to Mr. Obbad on the closing date of the Nebula Acquisition. The Obbad Award vested 25% on the grant date and will vest 25% per year for the next three years subject to Mr. Obbad’s continued employment with the Company. The Obbad Award expires on the seventh anniversary of the grant date. Any portion of the Obbad Award that does not vest and become exercisable will be forfeited for no consideration. The grant date fair value of the Obbad Award was approximately $1,128,000. On May 9, 2022, the Company issued a non-qualified stock option to the prospective Chief Financial Officer of the Company (the “CFO”), as an inducement to his employment with the Company, effective May 23, 2022 (the “CFO Award”). The CFO Award entitled the CFO to purchase up to 400,000 shares of the Company’s common stock at an exercise price of $6.74 per share, the closing price of the Company’s common stock on May 9, 2022. The CFO Award provided for certain proportionate adjustments to be made in the event of any change in the outstanding shares of common stock of the Company as a result of, among other things, any distribution or special dividend to stockholders of shares, cash or other property (other than regular cash dividends) in order to maintain parity. The exercise price of the CFO Award was reduced from $6.74 to $6.44 per share, effective as of June 3, 2022, the date $0.30 special cash dividend was paid to Company’s stockholders. The grant date fair value of the CFO Award was approximately $1,604,000. In connection with CFO’s separation from service on October 4, 2022, these options were forfeited on October 4, 2022. The Company reversed $149,000 of stock based compensation expense previously recognized for the unvested options at the time of forfeiture. During the year ended December 31, 2022, the Company issued an inducement award to a prospective employee to purchase up to 250,000 shares of the Company’s common stock at an exercise price of $13.00, the closing price of the common stock on the date of grant. The award vested 50% on the date of grant and the remaining portion will vest 25% per year for the next two years. The award expires on the seventh anniversary of the grant date. For the year ended December 31, 2021, the Company granted an inducement award to a prospective employee to purchase up to 100,000 shares of the Company’s common stock at an exercise price of $5.76, the closing price of the common stock on the date of grant. The award vests in four equal installments from the date of grant. The award expires on the seventh anniversary of the grant date. All inducement awards have been granted outside of the Company’s equity compensation plans pursuant to Nasdaq Listing Rule 5635(c)(4). Summary of all option grants For the year ended December 31, 2022, the Company granted in the aggregate 1,095,000 stock options at an exercise price of $6.44-$12.92, the closing price of the Company’s common stock on the date of grant, to certain employees. The stock options vest in four equal annual installments beginning on the date of grant. The options were valued at $6.6 million at fair value, using the Black-Scholes option pricing model to calculate the grant-date fair value of the options. The fair value of stock options for employees are expensed over the vesting term in accordance with the terms of the related stock option agreements and non-employees are expensed over the terms of the service period.. For the year ended December 31, 2021, the Company granted 1,249,874 stock options at an exercise price of $5.28- $11.03, the closing price of the Company’s common stock on the date of grant, to certain employees. The stock options will vest in four equal annual installments beginning on the date of grant. The options were valued at $6.1 million at fair value, using the Black-Scholes option pricing model to calculate the grant-date fair value of the options. The fair value of stock options for employees are expensed over the vesting term in accordance with the terms of the related stock option agreements and non-employees are expensed over the terms of the service period. The following table summarizes stock options activity during Fiscal 2022 and 2021 (in thousands, except per share data). Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in years) Total Intrinsic Value Outstanding as of January 1, 2021 3,795 2.21 3.4 $ 26,441 Granted 1,825 7.29 6.2 — Forfeited (505) 8.50 0 — Expired (5) 1.39 0 — Outstanding as of December 31, 2021 5,110 $ 3.27 3.4 $ 20,820 Granted 1,095 9.92 7 — Exercised (1,833) 1.29 0 — Forfeited (420) 1.56 0 — Outstanding as of December 31, 2022 3,952 $ 5.35 4 $ 20,379 Options vested and exercisable 2,961 $ 4.06 3.2 $ 17,257 The following table summarizes weighted average assumptions used in determining the fair value of the stock options at the date of grant during Fiscal 2022 and 2021: For the years ended 2022 2021 Exercise price $ 10.03 $ 7.29 Expected term (years) 4.5 4 Expected stock price volatility 79 % 79 % Risk-free rate of interest 2.5% 0.8 % Expected dividend yield (per share) 0 % 0 % The expected stock price volatility is based on the Company’s historical common stock trading prices and the expected term is based on the period that the Company’s stock-based awards are expected to be outstanding based on the simplified method. The fair value of the stock options at the time of the grant in Fiscal 2022 and 2021 was $6.9 million and $6.1 million, respectively. For Fiscal 2022 and 2021, we charged to operations approximately $4.0 million and $3.2 million. As of December 31, 2022, there were 3,952,000 stock options outstanding and 2,961,000 stock options vested and exercisable. The Company will recognize an aggregate of approximately $4.5 million of remaining share-based compensation expense related to outstanding stock options over a weighted average period of 3 years. For the year ended December 31, 2022, we issued 828,021 shares of common stock through a cashless exercise of 1,833,000 options. In connection with the cashless exercise, the company repurchased 1,103,000 common stock at a cost of $7.5 million to satisfy tax withholding. Common Stock Warrants For the year ended December 31, 2021, the Company issued warrants to purchase 275,000 shares of common stock in a registered direct offering and warrants to purchase 180,000 shares of common stock to the underwriters in an underwritten public offering. For the year ended December 31, 2021, the Company issued 5,986 shares of common stock through a cashless exercise of 50,000 common stock warrants. During the year ended December 31, 2022, there were no stock warrants issued. The following table summarizes warrant activities during Fiscal 2022 and 2021 (in thousands, except per share data): Number of Shares Weighted Average Weighted Average Outstanding as of January 1, 2021 450 $ 3.22 2.7 Warrants granted 455 12.83 3 Cashless exercise (50) 5.00 0 Outstanding as of December 31, 2021 855 $ 8.23 1.9 Warrants granted — — 0 Outstanding as of December 31, 2022 855 $ 8.23 1.9 Warrants vested and exercisable 855 $ 8.23 1.9 The following table summarizes weighted average assumptions used in determining the fair value of the warrants at the date of grant during Fiscal 2022 and Fiscal 2021: For the years ended 2022 2021 Exercise price $ — $ 12.83 Expected term (years) 0 3.0 Expected stock price volatility 0% 81% Risk-free rate of interest 0.0% 0.2 % Expected dividend yield (per share) 0 % 0 % As of December 31, 2022, there were 855,000 warrants outstanding, and the full share-based compensation expense was recognized in prior years. The Company recognized $253,000 of share-based compensation expense for the year ended December 31, 2021. |
Defined Contribution Plans
Defined Contribution Plans | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
Defined Contribution Plans | Defined Contribution PlansThe Company maintains the ProPhase Labs, Inc. 401(k) Savings and Retirement Plan, a defined contribution plan for its employees. The Company's contributions to the plan are based on the amount of the employee plan contributions and compensation. The Company's contributions to the plan for the years ended December 31, 2022 and 2021 were $0.2 million and $0.1 million, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The components of the provision (benefit) for income taxes, in the consolidated statements of operations are as follows (in thousands): For the years ended December 31, 2022 December 31, 2021 Continuing Operations Current Federal $ 1,040 $ — State 3,543 1,318 $ 4,583 $ 1,318 Deferred Federal 72 (1,511) State (210) (775) $ (138) $ (2,286) Income taxes from continuing operations $ 4,445 $ (968) A reconciliation of the statutory federal income tax expense (benefit) to the effective tax is as follows (in thousands): 2022 2021 Statutory Rate - federal $ 4,811 $ 1,232 State taxes, net of federal benefit 2,789 366 Research & development tax credit (1,200) — Permanent differences and other (601) 227 Income taxes from continuing operations before valuation allowance $ 5,799 $ 1,825 Change in valuation allowance (1,354) (2,793) Income tax expense (benefit) $ 4,445 $ (968) Total $ 4,445 $ (968) The tax effects of the primary “temporary differences” between values recorded for assets and liabilities for financial reporting purposes and values utilized for measurement in accordance with tax laws giving rise to our deferred tax assets are as follows (in thousands): For the years ended December 31, 2022 December 31, 2021 Net operating loss and capital loss carryforward $ 1,324 $ 3,584 Right of use asset (1,466) 1,348 Other 2,684 2,531 Capital lease obligations 1,466 (1,348) Depreciation (705) (948) Amortization (2,703) (2,989) Valuation allowance (824) (2,178) Total $ (224) $ — The Company accounts for income taxes under ASU No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which simplifies various aspects related to accounting for income taxes. This standard became effective for the Company January 1, 2021. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. The Company recognizes tax assets and liabilities for the future tax consequences related to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and for net operating loss carryforwards. Management evaluated the deferred tax assets for recoverability using a consistent approach that considers the relative impact of negative and positive evidence, including historical profitability and projections of future reversals of temporary differences and future taxable income. The Company is required to establish a valuation allowance for deferred tax assets if management determines, based on available evidence at the time the determination is made, that it is not more likely than not that some portion or all of the deferred tax assets will be realized. As of December 31, 2022 the Company has net deferred tax liabilities for federal and combined state jurisdictions after releasing the valuation allowance in those jurisdictions. The Company continues to maintain a valuation allowance against some of the separate company state NOL carryforwards. As of December 31, 2022 there is a valuation allowance of $0.8 million compared to $2.2 million as of December 31, 2021. As of December 31, 2022, the Company has state NOL carryforwards of $0.8 million, which begin to expire in 2024 and federal NOL carryforwards of $0.5 million which can be carried forward indefinitely. The federal NOL is attributable to 2021 Nebula acquisition, and it is Section 382 limited with an annual limitation of $0.6 million. The Company files a consolidated federal income tax return and separate company state returns as well as combined state returns where applicable. |
Other Current Liabilities
Other Current Liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Other Liabilities Disclosure [Abstract] | |
Other Current Liabilities | Other Current Liabilities The following table sets forth the components of other current liabilities at December 31, 2022 and 2021, respectively (in thousands): December 31, 2022 December 31, 2021 Accrued diagnostic services commissions $ 1,093 $ 1,283 Accrued payroll 202 514 Accrued expenses 714 300 Accrued returns 13 338 Accrued benefits and vacation 50 60 Total other current liabilities $ 2,072 $ 2,495 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Manufacturing Agreement The Company and its wholly owned subsidiary, PMI, entered into a manufacturing agreement (the “Manufacturing Agreement”) with Mylan in connection with the asset purchase agreement we entered into with Mylan in 2017. Pursuant to the terms of the Manufacturing Agreement, Mylan (or an affiliate or designee) purchased the inventory of the Company’s Cold-EEZE® brand and product line, and PMI agreed to manufacture certain products for Mylan, as described in the Manufacturing Agreement, at prices that reflect current market conditions for such products and include an agreed upon mark-up on our costs. On May 1, 2021, the Manufacturing Agreement was assigned by Mylan to Nurya Brands, Inc. (“Nurya”) in connection with Nurya’s acquisitions of certain assets from Mylan, including the Cold-EEZE® brand and product line. Unless terminated sooner by the parties, the Manufacturing Agreement will remain in effect until March 29, 2023. Thereafter, the Manufacturing Agreement may be renewed by Nurya for up to five successive one-year periods by providing notice of its intent to renew not less than 90 days prior to the expiration of the then-current term. In November 2022, Meda provided a notice to extend the original agreement for another year through March 2024. License Agreement In July 19, 2022, the Company through its wholly-owned subsidiary ProPhase BioPharma entered into a License Agreement (the “License Agreement”) with Global BioLife, Inc. (the “Licensor”), with an effective date of July 18, 2022 (the “Linebacker Effective Date”), pursuant to which it acquired from Licensor a worldwide exclusive right and license under certain patents identified in the License Agreement (the “Licensed Patents”) and know-how (collectively, the “Licensed IP”) to exploit any compound covered by the Licensed Patents (the “Licensed Compound”), including Linebacker LB1 and LB2, and any product comprising or containing a Licensed Compound (“Licensed Products”) in the treatment of cancer, inflammatory diseases or symptoms, memory-related syndromes, diseases or symptoms including dementia and Alzheimer’s Disease (the “Field”). Under the terms of the License Agreement, the Licensor reserves the right, solely for itself and for GRDG Sciences, LLC (“GRDG”) to use the Licensed Compound and Licensed IP solely for research purposes inside the Field and for any purpose outside the Field. Subject to certain conditions set forth in the License Agreement, the Company may grant sublicenses (including the right to grant further sublicenses) to its rights under the License Agreement to any of its affiliates or any third party with the prior written consent of Licensor, which consent may not be unreasonably withheld. Either party to the License Agreement may assign its rights under the License Agreement (i) in connection with the sale or transfer of all or substantially all of its assets to a third party, (b) in the event of a merger or consolidation with a third party or (iii) to an affiliate; in each case contingent upon the assignee assuming in writing all of the obligations of its assignor under the License Agreement. Under the terms of License Agreement, the Company is required to pay to Licensor a one-time upfront license fee of $50,000 within 10 days of the Linebacker Effective Date and must pay an additional $900,000 following the achievement of a first Phase 3 study which may be required by FDA for the first Licensed Product and an additional $1 million upon the receipt of regulatory approval of a New Drug Application (NDA) for the first Licensed Product. During the term of the License Agreement, the Company is also required to pay to Licensor 3% royalties on Net Revenue (as defined in the License Agreement) of each Licensed Product, but no less than the minimum royalty of $250,000 of Net Revenue per year minus any royalty payments for any required third party licenses. In connection with the License Agreement, the Company has incurred approximately $0.5 million in general and administrative expenses that are included in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the year ended December 31, 2022. No clinical studies have begun under this agreement. Litigation In the normal course of our business, we may be named as a defendant in legal proceedings. It is our policy to vigorously defend litigation or to enter into a reasonable settlement where management deems it appropriate. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | Leases On October 23, 2020, the Company completed the acquisition of CPM, which included the acquisition of a 4,000 square foot CLIA accredited laboratory located in Old Bridge, New Jersey, which was owned by CPM (which is now known as ProPhase Diagnostics NJ, Inc.). The lease is for a term of 24 months with a monthly base lease payment of $5,950. New York Second Floor Lease On December 8, 2020, the Company entered into a Lease Agreement (the “NY Second Floor Lease”) with BRG Office L.L.C. and Unit 2 Associates L.L.C. (the “Landlord”), pursuant to which the Company leases certain premises located on the second floor (the “Second Floor Leased Premises”) of 711 Stewart Avenue, Garden City, New York (the “Building”). The Second Floor Leased Premises serve as the Company’s second location and corporate headquarters, offering a wide range of laboratory testing services for diagnosis, screening and evaluation of diseases, including COVID-19 and Respiratory Pathogen Panel Molecular tests. The NY Second Floor Lease was effective as of December 8, 2020, and commenced in January 2021 (the “Commencement Date”) when the facility was made available to us by the landlord. The initial term of the NY Lease is 10 years and 7 months (the “Initial Term”), unless sooner terminated as provided in the NY Lease. The Company may extend the term of the NY Lease for one additional option period of five years. The Company has the option to terminate the NY Lease on the sixth anniversary of the Commencement Date, provided that it gives the landlord written notice not less than nine months and not more than 12 months in advance and that we pay the landlord a termination fee. For the first year of the NY Second Floor Lease, the Company paid a base rent of $56,963 per month (subject to a seven-month abatement period), with a gradual rental rate increase of 2.75% for each 12-month period thereafter in lieu of paying its proportionate share of common area operating expenses, culminating in a monthly base rent of $74,716 during the final months of the Initial Term. In addition to the monthly base rent, the Company is responsible for its proportionate share of real estate tax escalations in accordance with the terms of the NY Lease. The Company also has a right of first refusal to lease certain additional space located on the ground floor of the Building containing 4,500 square feet and 4,600 square feet, as more particularly described in the NY Lease. The Company also has a right of first offer to purchase the Building during the term of the NY Lease. On June 10, 2022, the Company entered into a First Amendment to the NY Second Floor Lease (the “Second Floor Lease Amendment”). The Second Floor Lease Amendment amends the NY Second Floor Lease to provide that any uncured default by the Company or any of its affiliate under the NY First Floor Lease (defined below) will constitute a default by the Company under the NY Second Floor Lease. New York First Floor Lease On June 10, 2022, the Company entered into a second Lease Agreement (the “NY First Floor Lease”) with Landlord, pursuant to which the Company leases approximately 4,516 sq. feet located on the first floor (the “NY First Floor Leased Premises”) of the Building. As described above, the Company currently leases space on the second floor of the Building. The First Floor Leased Premises will be used to expand the Company’s in-house lab capabilities to include traditional clinical testing across multiple specialty areas and Next Generation Sequencing (NGS) to perform Whole Genome Sequencing (WGS) and an array of genetic diagnostic test offerings for both clinical and research purposes. The NY First Floor Lease became effective as of June 10, 2022 and will commence upon the date of the Landlord’s substantial completion of certain improvements to the NY First Floor Leased Premises (the “First Floor Commencement Date”), as set forth in the NY First Floor Lease, targeted to be approximately five months from the execution of the NY First Floor Lease. The initial term of the NY First Floor Lease will expire on July 15, 2031, unless sooner terminated as provided in the NY First Floor Lease. The Company may extend the term of the NY First Floor Lease for one additional option period of five years pursuant to the terms described in the NY First Floor Lease. The Company has the option to terminate the NY First Floor Lease effective July 31, 2027 (the “Early Termination Date”), provided the Company gives the Landlord written notice not less than nine months and not more than 12 months prior to the Early Termination Date and pays the Landlord a termination fee as more particularly described in the Lease. For the first year of the NY First Floor Lease, the Company will pay a base rent of $11,290 per month (subject to an eight month abatement period), with a gradual rental rate increase of approximately 2.75% for each 12 month period thereafter, culminating in a monthly base rent of $14,026 during the final months of the initial term of the NY First Floor Lease. In addition to the monthly base rent, the Company is responsible for its proportionate share of real estate tax escalations in accordance with the terms of the NY First Floor Lease. The Landlord will provide a construction allowance to the Company in an aggregate amount not to exceed $203,220, to reimburse the Company for the cost of certain improvements to be made by the Company to the First Floor Leased Premises. At December 31, 2022, we had operating lease liabilities for the New York and New Jersey leases of approximately $4.6 million and right of use assets of approximately $4.1 million, which were included in the consolidated balance sheet. The following summarizes quantitative information about our operating leases (in thousands): For the Years Ended December 31, 2022 December 31, 2021 Operating leases Operating lease cost $ 816 $ 816 Variable lease cost $ — $ — Operating lease expense 816 816 Total rent expense $ 816 $ 816 For the Years Ended December 31, 2022 December 31, 2021 Operating cash flows used in operating leases $ (774) $ (357) Weighted-average remaining lease term – operating leases (in years) 8.5 9.4 Weighted-average discount rate – operating leases 10.00 % 10.00 % Maturities of the Company’s operating leases, excluding short-term leases, are as follows (in thousands): Year Ended December 31, 2023 $ 739 Year Ended December 31, 2024 747 Year Ended December 31, 2025 768 Year Ended December 31, 2026 783 Year Ended December 31, 2027 804 Thereafter 3,071 Total 6,912 Less present value discount (2,352) Operating lease liabilities $ 4,560 |
Consulting Agreement and Secure
Consulting Agreement and Secured Promissory Note Receivable | 12 Months Ended |
Dec. 31, 2022 | |
Consulting Agreement And Secured Promissory Note Receivable | |
Consulting Agreement and Secured Promissory Note Receivable | Consulting Agreement and Secured Promissory Note Receivable Consulting Agreement On September 25, 2020, the Company entered into a consulting agreement (the “Consulting Agreement”) with an unaffiliated company acting as a consultant (the “Consultant”). The Consulting Agreement was to be effective through September 1, 2022; provided, however, that the Company could terminate this agreement at any time on five days’ prior written notice. The Consultant’s duties were to include, among other things, (i) identifying and introducing us to new opportunities in the medical technology and testing fields, (ii) assisting and advising us in acquiring one or more CLIA certified labs suitable for COVID-19 and other testing (“Test Labs”); (iii) assisting us in equipping and staffing any Test Labs acquired by us; (iv) advising and assisting in the operation of such Test Labs; (v) validating and obtaining certification of such Test Labs; and (vi) assisting us in obtaining a flow of business, orders and revenues from multiple sources in the industry, including but not limited to at least one significant, nation-wide manufacturer and distributor of COVID-19 saliva sample collection test kits (“COVID-19 Test Kits”). All compensation earned by the Consultant would first be applied to the acceleration and prepayment of all sums due to us, including but not limited to sums due pursuant to the Amended and Restated Promissory Note (“Secured Note”) described below. Promissory Note and Security Agreement On September 25, 2020 (the “Restatement Effective Date”), the Company entered into the Secured Note with the Consultant, pursuant to which it loaned $3.0 million to the Consultant (inclusive of $1.0 million in the aggregate previously loaned to the Consultant, as described below). The Secured Note amended and restated in its entirety (i) that certain Promissory Note and Security Agreement, dated July 21, 2020 (the “Original July 21 Note”), pursuant to which the Company loaned $750,000 to the Consultant and (ii) that certain Promissory Note and Security Agreement, dated July 29, 2020 (the “Original July 29 Note”, and, together with the Original July 21 Note, the “Original Notes”), pursuant to which the Company loaned $250,000 to the Consultant. Commencing after September 1, 2021, in addition to payments of interest, the Consultant is also required to make payments on the principal amount of the loan equal to 1/36 of the then outstanding principal amount. The entire remaining unpaid principal amount of the Secured Note, together with all accrued and unpaid interest thereon and all other amounts payable under the Secured Note, was due and payable on September 30, 2022. As discussed in Amendment and Termination Agreement below, the Company issued a Notice of Default to the Consultant on October 11, 2021. Total interest income recorded in the years ended December 31, 2022 and 2021, was $— and $642,000, respectively. Amendment and Termination Agreement On January 14, 2021, the Company entered into an Amendment and Termination Agreement (the “Termination Agreement”) with the Consultant pursuant to which the parties amended the Secured Note and terminated the Consulting Agreement. Pursuant to the terms of the Termination Agreement, the Company loaned an additional $1 million to the Consultant in consideration for the termination of the Consulting Agreement and termination of the Company’s obligation to pay the Consultant additional consulting fees beyond the $250,000 already earned by the Consultant under the Consulting Agreement. As a result, the initial principal amount due under the Secured Note was increased from $2.75 million million to $3.75 million plus all accrued and unpaid interest arising under the Secured Note through and including January 14, 2021. Under the terms of the Termination Agreement, the Consultant will continue to sell and process its viral test by RT-PCR (together with other viral and other types of tests). Until the Secured Note is paid in full, each COVID-19 Test Kit sold or processed from and after January 14, 2021, and for which payment of at least the specified amount as defined for the test, is received by the Consultant, the Consultant will pay us a specified amount (the “Test Fee”). The total payments will not exceed the aggregate amounts due under the Secured Note and will be applied first to interest and other amounts due under the Secured Note and then to the then-current outstanding principal. Test Fees will be due and payable on the 10th business day after the end of each month commencing in February 2021, and until the Secured Note is paid in full. The Company received the first payment in the amount of $95,000 with respect to the Test Fees from January 15 through February 2021. On June 25, 2021, we were issued 1,260,619 shares of common stock of the Consultant with a fair value of $315,000 as an interest payment under the Secured Note in lieu of Test Fees from March through June 2021. Effective September 1, 2021, in addition to the payment of the Test Fees described above, the Consultant also is also required to make payments to us in an amount equal to the greater of (x) the Test Fee, or (y) 1/36th of the then outstanding principal amount together with interest thereon and interest accruing on the Secured Note, in accordance with the Secured Note. Accordingly, effective September 1, 2021, the minimum number of monthly payments due and payable to us is equal to the amount required to amortize fully the outstanding principal amount of the Secured Note, together with interest over a period of 36 months with level monthly payments. From September 1, 2021 through December 31, 2022, the Company did not receive any payments from the Consultant for either principal or interest. On October 11, 2021, the Company provided the Consultant with a Notice of Default and demanded the Secured Note be paid in full immediately. On January 25, 2022, the Company filed a complaint with the United States District Court for the District of Delaware for judgment against the Consultant for money damages consisting of principal, interest, default interest and other fees and costs. As a result, the Company considered that it is not probable that it will collect all amounts due under the Secured Note and reduced the carrying value of the Secured Note to $0 as of December 31, 2021 with a corresponding charge-off of $— million and $3.7 million during the years ended December 31, 2022 and 2021, respectively, to bad debt expense, which is included in other income (loss) on the accompanying statements of operations. |
Significant Customers Concentra
Significant Customers Concentrations | 12 Months Ended |
Dec. 31, 2022 | |
Risks and Uncertainties [Abstract] | |
Significant Customers Concentrations | Significant Customers Concentrations Revenue for Fiscal 2022 and Fiscal 2021 was $122.6 million and $79.0 million , respectively. Two diagnostic services clients accounted for 65.0% and 15.0% , of our net revenue for the year ended December 31, 2022. Three diagnostic service clients accounted for 23.5%, 17.9% and 11.9% of our net revenue for the year ended December 31, 2021. For Fiscal 2022 and 2021, there were no third-party contract manufacturing customers accounted for 10% or more of our revenues, for each year , respectively. The loss of sales to any of these large customers could have a material adverse effect on our business operations and financial condition. Collections of diagnostic services revenues are driven by payers, which are government agencies (primarily HRSA), insurance providers, and client payers. In Fiscal 2022, requisitions from each payer group were 29% , 66% , and 5% , respectively. In Fiscal 2021, requisitions from each payer groups was 60%, 35% and 5%. The Company is subject to account receivable credit concentrations from time-to-time as a result of the timing, payment pattern and ultimate purchase volumes or shipping schedules with our customers. These concentrations may impact its overall exposure to credit risk, either positively or negatively, in that our customers may be similarly affected by changes in economic, regulatory or other conditions that may impact the timing and collectability of amounts due to the Company. Two diagnostic services payers generated 68.8% and 16.0% of our total reimbursement receivable balances from government agencies and healthcare issuers at December 31, 2022. Four diagnostic services payers generated 43.0%, 11.6%, 10.7% and 10.7% of our total reimbursement receivable balances from government agencies and healthcare issuers at December 31, 2021. Currently, the Company relies on a sole supplier to manufacture its saliva collection kits used by customers who purchase its personal genomics services. Change in the supplier or design of certain of the materials that the Company relies on, in particular the saliva collection kit, could result in a requirement for additional premarket review from the FDA before making such a change. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company has identified two operating segments, diagnostic services and consumer products, based on the manner in which the Company’s CEO as CODM assesses performance and allocates resources across the organization. The operating segments are organized in a manner that depicts the difference in revenue generating synergies that include the separate processes, profit generation and growth of each segment. The diagnostic services segment provides COVID-19 diagnostic information services to a broad range of customers in the United States, including health plans, third party payers and government organizations. The consumer products segment is engaged in the research, development, manufacture, distribution, marketing and sale of OTC consumer healthcare products and dietary supplements in the United States and also provides personal genomics products and services. The unallocated corporate expenses mainly included professional fees associated with the public company. The following table is a summary of segment information for Fiscal 2022 and Fiscal 2021 (in thousands): For the years ended December 31, 2022 December 31, 2021 Net revenues Diagnostic services $ 108,329 $ 68,559 Consumer products 14,318 10,483 Consolidated net revenue 122,647 79,042 Cost of revenue Diagnostic services 39,896 29,415 Consumer products 12,097 7,639 Consolidated cost of revenue 51,993 37,054 Depreciation and amortization expense Diagnostic services 2,336 1,976 Consumer products 2,206 7 Total Depreciation and amortization expense 4,542 1,983 Operating and other expenses 43,203 34,700 Income (loss) from operations, before income taxes Diagnostic services 56,389 18,197 Consumer products (10,824) (1,714) Unallocated corporate (22,657) (11,178) Total income from operations, before income taxes 22,908 5,305 Income tax benefit (expense) (4,445) 968 Net Income $ 18,463 $ 6,273 The following table is a summary of segment information for Fiscal 2022 and Fiscal 2021 (in thousands): December 31, December 31, ASSETS Diagnostic services $ 50,832 $ 51,150 Consumer products 22,080 24,139 Unallocated corporate 14,736 14,006 Total assets $ 87,648 $ 89,295 |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic earnings per share (“EPS”) excludes dilution and is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or otherwise result in the issuance of common stock that shared in the earnings of the entity. Diluted EPS also utilizes the treasury stock method which prescribes a theoretical buy back of shares from the theoretical proceeds of all options outstanding during the period, and the if-converted method for convertible debt. The following is a reconciliation of the weighted average number of common shares outstanding used in calculating basic and diluted net loss per share (in thousands): For the years ended December 31, 2022 December 31, 2021 Net income - basic $ 18,464 $ 6,273 Interest on unsecured convertible promissory note 632 1,000 Net income - diluted $ 19,096 $ 7,273 Weighted average shares outstanding - basic 15,845 15,172 Diluted shares- Stock Options 1,493 2,001 Diluted shares- Stock Warrants 1,073 220 Unsecured convertible promissory note 240 1,000 Weighted average shares outstanding - diluted $ 18,651 $ 18,393 The following table represents the number of securities excluded from the income per share computation as a result of their anti-dilutive effect (in thousands): For the years ended Anti-dilutive securities December 31, 2022 December 31, 2021 Common stock purchase warrants 455 455 Stock Options 770 828 Unsecured convertible promissory note — — Anti-dilutive securities 1,225 1,283 |
Related Parties
Related Parties | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Related Parties | Related PartiesThe Company's Executive Vice President and Co-Chief Operations Officer of ProPhase Diagnostics, is a related party to the Company's Chairman and Chief Executive Officer. For the years ended December 31, 2022 and December 31, 2021, there were no payments made to the Executive Vice President outside compensation for the position held at the Company. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Stella Diagnostics - Asset Purchase Agreement On December 15, 2022, the Company entered into an Asset Purchase Agreement (the “Stella Purchase Agreement”), by and among the Company and Stella Diag nostics Inc. (“Stella”) and Stella DX, LLC (“Stella DX” and, together with Stella, the “Stella Sellers”), pursuant to which, on January 3, 2023, the Company purchased all of the assets, rights and interests of the Stella Sellers and their affiliates pertaining to the Stella Sellers’ BE-Smart Esophageal Pre-Cancer diagnostic screening test and certain clinical assets, including all intellectual property rights (the “Stella Purchased Assets”). As consideration for the Stella Purchased Assets, the Company (i) paid to the Stella Sellers $3.5 million in cash, minus (a) the Secured Note Amount, if any, (b) the Liability Payoff Amount and (c) the Promissory Note Payoff Amounts (each as defined in the Stella Purchase Agreement), and (ii) issued to Stella DX 100,000 shares of common stock, par value $0.0005 per share, of the Company. The Company is required to pay to the Stella Sellers for each of the seven seven Management is reviewing the final closing transactions to complete the accounting. These amounts will be reported in the Company's Form 10-Q for the three months ended March 31, 2023. Debt and Equity Transactions On January 26, 2023, the Company issued an unsecured promissory note and guaranty for an aggregate principal amount of $7.6 million (the “Note”) to JXVII Trust (“JXVII”). The Note is due and payable on January 27, 2026, the third anniversary of the date on which the Note was funded (the “Closing Date”), and accrues interest at a rate of 10% per year from the Closing Date, payable on a quarterly basis, until the Note is repaid in full. The Company has the right to prepay the Note at any time after the Closing Date and prior to the maturity date without premium or penalty upon providing seven days’ written notice to JXVII. Repayment of the Note has been guaranteed by the Company’s wholly-owned subsidiary, Pharmaloz Manufacturing, Inc. In January 2023, the Company issued 603,881 shares of common stock through a cashless exercise of 1,348,250 options. In connection with the cashless exercise, the company repurchased 744,369 shares of common stock at a cost of $5,378 to satisfy tax withholding. On March 13, 2023, the Company granted, in the aggregate, 205,000 stock options to seven employees under the 2022 Plan with an exercise price of $6.84, the closing price of the Company’s common stock on the date of grant. The options vest 25% on the date of grant with the remaining 75% vesting over a 3-year period in equal annual installments. The estimated fair value of these options at the date of grant was $0.9 million, which will be expensed over the vesting term. On March 15, 2023, the Company announced that its board of directors had approved a new stock repurchase program. Under the stock repurchase program, the Company is authorized to repurchase up to $6.0 million of its outstanding shares of common stock from time to time, over a six-month period. The number of shares to be repurchased and the timing of the repurchases, if any, will depend on a number of factors, including, but not limited to, price, trading volume and general market conditions, along with the Company’s working capital requirements and general business conditions. The board of directors will re-evaluate the program from time to time and may authorize adjustments to its terms. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to the current period presentation. These reclassifications had no effect on the reported results of operations. |
Segments | Segments In accordance with the Financial Accounting Standards Board's ("FASB") Accounting Standards Codification ("ASC") 280, “Segment Reporting” (“ASC 280”), the Company discloses financial and descriptive information about its reportable operating segments. Operating segments are components of an enterprise about which separate financial information is available and regularly evaluated by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company follows ASC 280, which establishes standards for reporting information about operating segments in annual and interim financial statements, and requires that companies report financial and descriptive information about their reportable segments based on a management approach. ASC 280 also establishes standards for related disclosures about products and services, geographic areas and major customers. Operating segments are defined as components of an enterprise that engage in business activities for which separate financial information is available and is evaluated by the Chief Operating Decision Maker (“CODM”), which for the Company is its Chief Executive Officer, in deciding how to allocate resources and assess performance. We maintain two operating segments: diagnostic services (which includes our COVID-19 and other diagnostic testing services) and consumer products (which includes our contract manufacturing, retail customers, biopharma and personal genomics products and services). See Note 15 Segment Information. |
Business and Liquidity Risks and Uncertainties | Business and Liquidity Risks and Uncertainties Our diagnostic service business is and will continue to be impacted by the level of demand for COVID-19 and other diagnostic testing, how long this demand persists, the prices we are able to receive for performing our testing services, our ability to collect payment or reimbursement for our testing services, as well as the availability of COVID-19 testing from other laboratories and the period of time for which we are able to serve as an authorized laboratory offering COVID-19 testing under various Emergency Use Authorizations. While our revenues increased significantly for the year ended December 31, 2022 as a result of the diagnostic services business line, we have made and will continue to make substantial investments to secure the necessary equipment, supplies and personnel to provide these testing services. Our customer base for our COVID-19 tests is principally comprised of governmental bodies, municipalities, and large corporations who pay us directly or through third-party payers. While our revenues increased significantly since the launch of our diagnostic services business, we have been dependent on both government agency and insurance company reimbursement as well as the prevalence of COVID-19 associated strains. In March 2020, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), was enacted, providing for reimbursement to healthcare providers for COVID-19 tests provided to uninsured individuals, subject to continued available funding. On March 22, 2022, the Health Resources & Services Administration (HRSA) program stopped accepting claims for COVID-19 testing and treatment due to lack of sufficient funds. As a result of the suspension of the HRSA uninsured program, we have not recognized any revenue related to COVID-19 testing that we performed for uninsured individuals from March 22, 2022 through December 31, 2022. Our personal genomics business is and will continue to be influenced by demand for our genetic sequencing products and services, our marketing and service capabilities, and our ability to comply with applicable regulatory requirements. Our contracting manufacturing business is and will continue to be impacted by demand for our services, which is largely a function of the timing, length and severity of each cold season. Generally, a cold season is defined as the period from September to March when the incidence of the common cold rises as a result of the change in weather and other factors. We generally experience in the first, third and fourth quarter higher levels of net revenues from our contract manufacturing business. Revenues are generally at their lowest levels in the second quarter when customer demand generally declines. Our consumer sales are and will continue to be impacted by (i) the timing of acceptance of our TK Supplements ® consumer products in the marketplace, and (ii) fluctuations in the timing of purchase and the ultimate level of demand for these products. For the year ended December 31, 2022, $28.6 million was provided by operating activities. The Company had cash, cash equivalents and marketable securities of $17.4 million as of December 31, 2022. Based on management’s current business plans, the Company estimates that it will have enough cash and liquidity to finance its operating requirements for at least one year from the date of filing these financial statements. However, due to the nature of the diagnostic business and the Company's focus thus far on COVID-19, there are inherent uncertainties associated with managements’ business plan and cash flow projections if the Company is unable to grow its diagnostic testing business beyond COVID-19 testing services and to grow its other businesses. Concentration of Financial Risks Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash investments, marketable debt securities, and trade accounts receivable. Our marketable securities are fixed income investments, which are highly liquid and can be readily purchased or sold through established markets. We maintain cash and cash equivalents with certain major financial institutions. As of December 31, 2022, our cash and cash equivalents and restricted cash balance was $9.1 million. Of the total bank balance, $1.0 million was covered by federal depository insurance and $8.4 million was uninsured at December 31, 2022. Accounts receivable subject us to credit risk concentrations from time-to-time. We extend credit to our consumer healthcare product customers based upon an evaluation of the customer’s financial condition and credit history and generally do not require collateral. Our diagnostic services receivable credit risk is based on payer reimbursement experience, which includes government agencies and healthcare insurers, the period the receivables have been outstanding and the historical collection rates. The collectability of the diagnostic services receivables is also directly linked to the quality of our billing processes, which depend on information provided and billing services of third parties. These credit concentrations impact our overall exposure to credit risk, which could be further affected by changes in economic, regulatory or other conditions that may impact the timing and collectability of trade receivables and diagnostic test receivables. Additionally, the reimbursement receivables from the diagnostic service business are subject to billing errors and related disputes. We also assess the financial condition of the debtor under our note receivable (see Note 13, Consulting Agreement and Secured Promissory Note Receivable and Consulting Agreement), balances due to us. As of December 31, 2022 and the financial statements reporting date, the Company did not expect full realization upon maturity. In addition, see Note 14 - Significant Customers Concentrations. |
Use of Estimates | Use of Estimates The preparation of financial statements and the accompanying notes thereto, in conformity with generally accepted accounting principles in the United States of America (“GAAP”), requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the respective reporting periods. Examples include revenue recognition and the impact of the variable consideration around diagnostic test reimbursement rates, the provision for uncollectible receivables and billing errors, sales returns and allowances, rates, slow moving, dated inventory and associated provisions, the estimated useful lives and potential impairment of long-lived assets, stock based compensation valuation, income tax asset valuations and assumptions related to accrued advertising. Our estimates and assumptions are based on historical experience, current trends and other factors that management believes to be relevant at the time the financial statements are prepared. Management reviews the accounting policies, assumptions, estimates and judgments on a quarterly basis. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents We consider all highly liquid investments with a maturity of three months or less at the time of purchase to be cash equivalents. Cash equivalents include cash on hand and monies invested in money market funds. The carrying amount approximates the fair market value due to the short-term maturity of these securities. |
Restricted Cash | Restricted CashRestricted cash as of December 31, 2022 and 2021 includes approximately $250,000 held in escrow related to a potential purchase of an additional lab facility. The Company fully reserved for this amount in Fiscal 2022. |
Marketable Debt Securities | Marketable Debt Securities We have classified our investments in marketable debt securities as available-for-sale and as a current asset. Our investments in marketable debt securities are carried at fair value, with unrealized gains and as a separate component of stockholders’ equity. Realized gains and losses from our marketable debt securities are recorded as interest income (expense). These investments in marketable debt securities carry maturity dates between one and three years from date of purchase and interest rates of 1.40% to 4.90% during fiscal 2022. The following is a summary of the components of our marketable debt securities and the underlying fair value input level tier hierarchy (see fair value of financial instruments) (in thousands): As of December 31, 2022 Amortized Unrealized Unrealized Fair U.S. government obligations $ 1484 $ 6 $ (12) $ 1478 Corporate obligations 5,702 1,228 (80) 6,850 $ 7,186 $ 1,234 $ (92) $ 8,328 As of December 31, 2021 Amortized Unrealized Unrealized Fair U.S. government obligations $ 650 $ 17 $ — $ 667 Corporate obligations 8,304 — (192) 8,112 $ 8,954 $ 17 $ (192) $ 8,779 We believe that the unrealized gains or losses generally are the result of a change in the risk premiums required by market participants rather than an adverse change in cash flows or a fundamental weakness in the credit quality of the issuer or underlying assets. |
Marketable Equity Securities | Marketable Equity Securities Marketable equity securities are recorded at fair value in the consolidated balance sheets. The change in fair value of marketable equity securities is recognized within other non-operating income, net in the consolidated statements of income. On June 25, 2021, we were issued 1,260,619 common shares (the “Investment Shares”) as an interest payment under our note receivable (see Note 13, Consulting Agreement and Secured Promissory Note Receivable) with a fair value of $315,000 and a fair value of $76,000 and $0 at December 31, 2021 and 2022, respectively. The investment was classified as a Level 1 financial instrument. We recorded a $76,000 decrease in fair value of investment securities within the statement of operations for the year ended December 31, 2022. |
Accounts Receivable, net | Accounts Receivable, net Accounts receivable consists primarily of amounts due from government agencies and healthcare insurers. Unbilled accounts receivable relates to the delivery of our diagnostic testing services for which the related billings will occur in a future period, after a patient’s insurance information has been validated, and represent amounts we have an unconditional right to receive payment. Unbilled accounts receivable is classified as accounts receivable on the consolidated balance sheet. We carry our accounts receivable at the amount of consideration for which we expect to be entitled less allowances. When estimating the allowances for our diagnostics business, the Company pools its trade receivables based on the following payer types: healthcare insurers and government payers. The Company principally estimates the allowance for credit losses by pool based on historical collection experience, current economic conditions, expectations of future economic conditions, other credits and the period of time that the receivables have been outstanding. To the extent that any individual payers are identified that have deteriorated in credit quality, the Company removes the payers from their respective pools and establishes allowances based on the individual risk characteristics of such payers. On a periodic basis, we evaluate our receivables and establish an allowance, based on a history of past write-offs, government and healthcare insurer payment trends, collections, current credit conditions or generally accepted future trends. Accounts are written off as uncollectible at the time we determine that collections are unlikely. Accounts receivable, net is comprised of the following (in thousands): December 31, 2022 December 31, 2021 Trade accounts receivable $ 37,568 $ 18,520 Unbilled accounts receivable 2,626 23,089 40,194 41,609 Less allowances (3,140) (3,901) Total accounts receivable $ 37,054 $ 37,708 For Fiscal 2022, we recorded $5.9 million to bad debt expense in operating expenses representing a write-off of trade receivables we have determined to be uncollectible. Additionally, we wrote off $2.9 million of trade receivables and related allowances at December 31, 2022, that were fully reserved for in 2021 and did not impact the result of operations for the year ended December 31, 2022. The Company also increased its allowance for doubtful accounts in Fiscal 2022 by $5.5 million. The results of these adjustments and our current year allowances, resulted in an allowance of $3.1 million at December 31, 2022. For Fiscal 2021, we recorded $3.9 million to the allowance with a corresponding charge to net revenues with no write-off to bad debt expense in 2021. |
Inventory, net | Inventory, net Inventory is valued at the lower of cost, determined on a first-in, first-out basis (“FIFO”), or net realizable value. Inventory items are analyzed to determine cost and the net realizable value and appropriate valuation adjustments are established. At December 31, 2022 and 2021, the components of inventory are as follows (in thousands): December 31, December 31, Diagnostic services testing material $ 1,739 $ 2,989 Raw materials 1,639 1,514 Work in process 754 260 Finished goods 356 272 Inventory $ 4,488 $ 5,035 Inventory valuation reserve (512) (435) Inventory, net $ 3,976 $ 4,600 |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment are recorded at cost. We use the straight-line method in computing depreciation for financial reporting purposes. Depreciation expense is computed in accordance with the following ranges of estimated asset lives: building and improvements - ten three three |
Leases | Leases At the inception of an arrangement, we determine whether the arrangement is or contains a lease based on the unique facts and circumstances present in the arrangement. Most leases with a term greater than one year are recognized on the balance sheet as right-of-use assets and short-term and long-term lease liabilities, as applicable. We have elected not to recognize on the balance sheet leases with terms of 12 months or less. We typically only include an initial lease term in its assessment of a lease arrangement. Options to renew a lease are not included in our assessment unless there is reasonable certainty that we will renew. Operating lease liabilities and their corresponding right-of-use assets are recorded based on the present value of lease payments over the expected remaining lease term. Certain adjustments to the right-of-use asset may be required for items such as incentives received. The interest rate implicit in our leases is typically not readily determinable. As a result, we utilize our incremental borrowing rate, which reflects the fixed rate at which we could borrow on a collateralized basis the amount of the lease payments in the same currency, for a similar term and in a similar economic environment (see Note 12, Leases). The components of a lease should be allocated between lease components ( e.g ., land, building, etc.) and non-lease components ( e.g ., common area maintenance, consumables, etc.). The fixed and in-substance fixed contract consideration (including any consideration related to non-components) must be allocated based on the respective relative fair values to the lease components and non-lease components. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill represents the excess of the fair value of the consideration transferred over the fair value of the underlying identifiable assets and liabilities acquired in a business combination. Goodwill and intangible assets deemed to have an indefinite life are not amortized, but instead are assessed for impairment annually. Additionally, if an event or change in circumstances occurs that would more likely than not reduce the fair value of the reporting unit below its carrying value, we would evaluate goodwill and other intangibles at that time. In testing for goodwill impairment, we have the option to first assess qualitative factors to determine whether the existence of events or circumstances lead to a determination that it is more likely than not that the fair value of the reporting unit is less than its carrying amount. If, after assessing the totality of events and circumstances, we conclude that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test is not required. If we conclude otherwise, we are required to perform the two-step impairment test. The goodwill impairment test is performed at the reporting unit level by comparing the estimated fair value of a reporting unit with its respective carrying value. If the estimated fair value exceeds the carrying value, goodwill at the reporting unit level is not impaired. If the estimated fair value is less than the carrying value, an impairment charge will be recorded to reduce the reporting unit to fair value. Management completed a qualitative assessment of Goodwill and it was not deemed impaired at December 31, 2022. Intangible assets deemed to have finite lives are amortized on a straight-line basis over their estimated useful lives, where the useful life is the period over which the asset is expected to contribute directly, or indirectly, to our future cash flows. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets, including property and equipment and finite-lived intangible assets, for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. An impairment loss is recognized when the asset’s carrying value exceeds the total undiscounted cash flows expected from its use and eventual disposition. The amount of the impairment loss is determined as the excess of the carrying value of the asset over its fair value. For the fiscal years ended December 31, 2022 and 2021, the Company did not have an impairment of the long-lived assets. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments We measure assets and liabilities at fair value based on expected exit price as defined by the authoritative guidance on fair value measurements, which represents the amount that would be received on the sale date of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value: • Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. • Level 2: Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. • Level 3: Unobservable inputs reflecting the Company’s assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. The carrying amounts of our financial assets and liabilities, such as cash, accounts receivable, accounts payable, and unsecured note payable, approximate their fair values because of the short-term nature of these instruments. We account for our marketable securities at fair value, with the net unrealized gains or losses of marketable debt securities reported as a component of accumulated other comprehensive income or loss and marketable equity securities change in fair value reported on the condensed consolidated statement of operations. The components of marketable securities are as follows (in thousands): As of December 31, 2022 Level 1 Level 2 Level 3 Total U.S. government obligations $ — $ 1,478 $ — $ 1,478 Corporate obligations 5,497 1,354 — 6,851 $ 5,497 $ 2,832 $ — $ 8,329 As of December 31, 2021 Level 1 Level 2 Level 3 Total U.S. government obligations $ — $ 667 $ — $ 667 Corporate obligations — 8,112 — 8,112 Marketable equity securities 76 — — 76 $ 76 $ 8,779 $ — $ 8,855 There were no transfers of marketable debt securities between Levels 1, 2 or 3 for the years ended December 31, 2022 and 2021. |
Revenue Recognition | Revenue Recognition We recognize revenue that represents the transfer of promised goods or services to customers at an amount that reflects the consideration that is expected to be received in exchange for those goods or services. We recognize revenue when performance obligations with our customers have been satisfied. At contract inception, we evaluate the contract to determine if revenue should be recognized using the following five steps: (1) identify the contract with the customer; (2) identify the performance obligations; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations; and (5) recognize revenue when (or as) the entity satisfies a performance obligation. Contract with Customers and Performance Obligations A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. Sales from product shipments to contract manufacturing and retailer customers are recognized at the time ownership is transferred to the customer. Revenue from diagnostic services is recognized when the results are made available to the customer. Revenue from our personal genomics business is recognized when the genetic testing results are provided to the customer. For subscription services associated with our genomic testing, we recognize revenue ratably over the term of the subscription. The Company’s performance obligation for contract manufacturing and retail customers is to provide the goods ordered by the customer. The Company has one performance obligation for its diagnostic services, which is to provide the results of the laboratory test to the customer. Our personal genomics business has separate performance obligations to provide initial testing and genome results and subscriptions services to our customers. Transaction Price For our diagnostic services business, a revenue transaction is initiated when we receive a requisition order to perform a diagnostic test. The information provided on the requisition form is used to determine the party that will be billed for the testing performed and the expected reimbursement. We provide diagnostic services to a range of customers. In many cases, the customer that orders our services is not responsible for paying for these services. Depending on the billing arrangement and applicable law, the payer may be the patient or a third party, such as a health plan, Medicare or Medicaid program and other government reimbursement programs. We bill the providers at standard price and take into consideration negotiated discounts and anticipated reimbursement remittance adjustments based on the payer portfolio, when revenue is recorded. We use the most expected value method to estimate the transaction price for reimbursements that vary from the listed contract price. For our personal genomics business, a revenue transaction is initiated by a DNA test kit sale direct to the consumer sales via our website or through online retailers. The kit sales and subscriptions are billed at a standard price and take into consideration any discounts when revenue is recorded. We also contract with third party B2B partners and universities and sell DNA test kits directly to them. For contract manufacturing and retail customers, the transaction price is fixed based upon either (i) the terms of a combined master agreement and each related purchase order, or (ii) if there is no master agreement, the price per individual purchase order received from each customer. The customers are invoiced at an agreed upon contractual price for each unit ordered and delivered by the Company. Revenue from retail customers is reduced for trade promotions, estimated sales returns and other allowances in the same period as the related sales are recorded. No such allowance is applicable to our contract manufacturing customers. We estimate potential future product returns and other allowances related to current period revenue. We analyze historical returns, current trends, and changes in customer and consumer demand when evaluating the adequacy of the sales returns and other allowances. We do not accept returns from our contract manufacturing customers. Our return policy for retail customers accommodates returns for (i) discontinued products, (ii) store closings and (iii) products that have reached or exceeded their designated expiration date. We do not impose a period of time during which product may be returned. All requests for product returns must be submitted to us for pre-approval. We will not accept return requests pertaining to customer inventory “Overstocking” or “Resets”. We will accept return requests only for products in their intended package configuration. We reserve the right to terminate shipment of product to customers who have made unauthorized deductions contrary to our return policy or pursue other methods of reimbursement. We compensate the customer for authorized returns by means of a credit applied to amounts owed. For our diagnostic services business, a revenue transaction is initiated when we receive a requisition order to perform a diagnostic test. The information provided on the requisition form is used to determine the party that will be billed for the testing performed and the expected reimbursement. We provide diagnostic services to a range of customers. In many cases, the customer that orders our services is not responsible for paying for these services. Depending on the billing arrangement and applicable law, the payer may be the patient or a third party, such as a health plan, Medicare or Medicaid program and other government reimbursement programs. We bill the providers at standard price and take into consideration negotiated discounts and anticipated reimbursement remittance adjustments based on the payer portfolio, when revenue is recorded. We use the most expected value method to estimate the transaction price for reimbursements that vary from the listed contract price. For our personal genomics business, a revenue transaction is initiated by a DNA test kit sale direct to the consumer sales via our website or through online retailers. The kit sales and subscriptions are billed at a standard price and take into consideration any discounts when revenue is recorded. We also contract with third party B2B partners and universities and sell DNA test kits directly to them. Recognize Revenue When the Company Satisfies a Performance Obligation For diagnostic services, the Company satisfies its performance obligation at the point in time that the results are made available to the customer, which is when the customer benefits from the information contained in the results and obtains control. For genomic services, we satisfy our product performance obligation at a point in time when the genetic testing results are provided to the customer. For subscriptions services associated with its genomic testing, we satisfy our performance obligation ratably over the subscription period. If the customer does not return the test kit, services cannot be completed by us, potentially resulting in unexercised rights (“breakage”) revenue, including lifetime subscription services. We estimate breakage for the portion of test kits not expected to be returned using an analysis of historical data and consider other factors that could influence customer test kit return behavior. When breakage revenue is recognized on a kit, we recognize breakage on any associated subscription services ratably over the term of the subscription . The Company recognized breakage revenue from aggregate unreturned test kits and subscriptions of $1.0 million for the year ended December 31, 2022. Performance obligations related to contract manufacturing and retail customers are satisfied at a point in time when the goods are shipped to the customer as (i) we have transferred control of the assets to the customers upon shipping, and (ii) the customer obtains title and assumes the risks and rewards of ownership after the goods are shipped. Contract Balances As of December 31, 2022 and December 31, 2021, we have deferred revenue of $3.6 million and $2.9 million, respectively. Our new personal genomics business comprised $3.5 million of the deferred revenue as of December 31, 2022. The remainder of deferred revenue relates to research and development (“R&D”) stability and release testing programs recognized as contract manufacturing revenue. Deferred revenues primarily consist of amounts that have been billed to or received from customers in advance of revenue recognition and prepayments received from customers in advance of services performed for the R&D work. We recognize deferred revenues as revenues when the services are performed and the corresponding revenue recognition criteria are met. Customer prepayments are generally applied against invoices issued to customers when services are performed and billed. The following table disaggregates our deferred revenue by recognition period (in thousands): As of December 31, 2022 As of December 31, 2021 Recognition Period 0-12 Months $ 2,499 $ 2,034 13-24 Months 683 530 Over 24 Months 376 375 Total $ 3,558 $ 2,939 Disaggregation of Revenue We disaggregate revenue from contracts with customers into four categories: contract manufacturing, retail and others, diagnostic services and genomic products and services. We determined that disaggregating revenue into these categories achieves the disclosure objective to depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. The following table disaggregates the Company’s revenue by revenue source for Fiscal 2022 and 2021 (in thousands): For the years ended Revenue by Customer Type December 31, 2022 December 31, 2021 Diagnostic services $ 108,329 $ 68,559 Contract manufacturing 8,740 5,786 Retail and others 1,281 2,454 Genomic products and services 4,297 2,243 Total revenue, net $ 122,647 $ 79,042 Customer Consideration The Company makes payments to certain diagnostic services customers for distinct services that approximate fair value for those services. Such services include specimen collection, the collection and delivery of insurance and patient information necessary for billing and collection, and logistics services. Consideration associated with specimen collection services is classified in cost of revenues and the remaining costs are classified as diagnostic expenses within operating expenses in the accompanying statement of operations. Sales Tax Exclusion from the Transaction Price We exclude from the measurement of the 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 the customer. Shipping and Handling Activities We account for shipping and handling activities that we perform as activities to fulfill the promise to transfer the good. |
Advertising and Incentive Promotions | Advertising and Incentive Promotions Advertising and incentive promotion costs are expensed within the period in which they are utilized. Advertising and incentive promotion expense is comprised of (i) media advertising, presented as part of general and administrative expense, (ii) cooperative incentive promotions and coupon program expenses, which are accounted for as part of net revenue, and (iii) free product, which is accounted for as part of cost of revenues. Advertising and incentive promotion expenses incurred from continuing operations for Fiscal 2022 and 2021 were $0.4 million and $0.4 million, respectively. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation in accordance with FASB ASC 718, “Compensation – Stock Compensation.” Under the fair value recognition provision of the ASC, stock-based compensation cost is estimated at the grant date based on the fair value of the award. The Company estimates the fair value of stock options and warrants granted using the Black-Scholes-Merton option pricing model and stock grants at their closing reported market value. We recognize all stock-based payments to employees and directors, including grants of stock options, as compensation expense in the financial statements based on their grant date fair values. The grant date fair values of stock options are determined through the use of the Black-Scholes option pricing model. The compensation cost is recognized as an expense over the requisite service period of the award, which usually coincides with the vesting period. We account for forfeitures as they occur. |
Research and Development | Research and Development R&D costs are charged to operations in the period incurred, R&D costs incurred for the years ended December 31, 2022 and 2021 were $0.7 million and $0.5 million, respectively. R&D costs are principally related to personnel expenses and new product development initiatives and costs associated with the OTC health care products, dietary supplements and validation costs associated with the diagnostic services business. |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with accounting guidance now codified as FASB ASC 740, “Income Taxes,” which requires that the Company recognize deferred tax liabilities and assets based on the differences between the financial statement carrying amounts and the tax bases of assets and liabilities, using enacted tax rates in effect in the years the differences are expected to reverse. The provision for, or benefit from, income taxes includes deferred taxes resulting from the temporary differences in income for financial and tax purposes using the liability method. Such temporary differences result primarily from the differences in the carrying value of assets and liabilities. Future realization of deferred income tax assets requires sufficient taxable income within the carry-back, carryforward period available under tax law. We evaluate, on a quarterly basis whether, based on all available evidence, it is probable that the deferred income tax assets are realizable. Valuation allowances are established when it is more likely than not that the tax benefit of the deferred tax asset will not be realized. The evaluation, as prescribed by ASC 740- 10, “Income Taxes,” includes the consideration of all available evidence, both positive and negative, regarding historical operating results including recent years with reported losses, the estimated timing of future reversals of existing taxable temporary differences, estimated future taxable income exclusive of reversing temporary differences and carryforwards, and potential tax planning strategies which may be employed to prevent an operating loss or tax credit carryforward from expiring unused. The Company accounts for income taxes under ASU No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which simplifies various aspects related to accounting for income taxes. This standard became effective for the Company January 1, 2021. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. The Company accounts for uncertainties in income taxes under the provisions of FASB ASC 740-10-05 (the “Subtopic”). The Subtopic clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. The Subtopic prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Subtopic provides guidance on the de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. |
Recently Issued Accounting Standards, Adopted | Recently Issued Accounting Standards, Adopted In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805)- Accounting for Contract Assets and Contract Liabilities from Contracts with Customers . The amendments in ASU No. 2021-08 address diversity and inconsistency related to the recognition and measurement of contract assets and contract liabilities acquired in a business combination. The amendments in ASU No. 2021-08 require that an acquirer recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606, Revenue from Contracts with Customers. Upon adoption, an acquirer should account for the related revenue contracts of the acquiree as if it has originated the contracts. For public business entities, the amendments in ASU No. 2021-08 are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The amendments in ASU No. 2021-08 should be applied prospectively to business combinations occurring on or after the effective date of the amendments. Early adoption of the amendments is permitted. An entity that early adopts should apply the amendments (1) retrospectively to all business combinations for which the acquisition date occurs on or after the beginning of the fiscal year that includes the interim period of early application and (2) prospectively to all business combinations that occur on or after the date of initial application. The Company has early adopted ASU No. 2021-08 effective January 1, 2021. The adoption of ASU No. 2021-08 resulted in adjustments to the fair values assigned to goodwill and deferred revenue assumed as of the acquisition dates of acquisitions occurring during the year ended December 31, 2021, and an increase in revenue for the year ended December 31, 2021, due to recognition of revenue earned during the period for deferred revenue contracts acquired in business combinations. The following tables present the material impacts of adopting ASU No. 2021-08 on the Company’s consolidated balance sheets as of December 31, 2021 (in thousands): As of December, 31 2021 Excluding impacts of adoption of ASU 2021-08 Adjustment Presentation with adoption of ASU 2021-08 Assets Goodwill $ 4,458 $ 1,251 $ 5,709 Liabilities Deferred Revenue $ 2,655 $ 284 $ 2,939 Stockholders’ equity Retained earnings $ 1,675 $ 967 $ 2,642 The following tables present the material impacts of adoption of ASU No. 2021-08 on the Company’s consolidated statements of operations for the year ended December 31, 2021 (in thousands): As of December, 31 2021 Excluding impacts of adoption of ASU 2021-08 Adjustment Presentation with adoption of ASU 2021-08 Revenue $ 78,075 $ 967 $ 79,042 Net income $ 5,306 $ 967 $ 6,273 Comprehensive income $ 5,142 $ 967 $ 6,109 The change in revenues from the ASU adoption did not cause a change in the DTA/DTL or tax expense accounts due to the full valuation allowance for federal tax purposes (any state impact was deemed immaterial). The only tax impact was due to the purchase accounting entry between goodwill and deferred revenue which resulted in a tax entry to goodwill and deferred taxes. The Company adopted, recently issued, ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470- 20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, to reduce complexity in applying GAAP to certain financial instruments with characteristics of liabilities and equity. The guidance in ASU 2020-06 simplifies the accounting for convertible debt instruments and convertible preferred stock by removing the existing guidance that requires entities to account for beneficial conversion features and cash conversion features in equity, separately from the host convertible debt or preferred stock. The guidance in ASC 470-20 applies to convertible instruments for which the embedded conversion features are not required to be bifurcated from the host contract and accounted for as derivatives. In addition, the amendments revise the scope exception from derivative accounting in ASC 815-40 for freestanding financial instruments and embedded features that are both indexed to the issuer’s own stock and classified in stockholders’ equity, by removing certain criteria required for equity classification. These amendments are expected to result in more freestanding financial instruments qualifying for equity classification (and, therefore, not accounted for as derivatives), as well as fewer embedded features requiring separate accounting from the host contract. The amendments in ASU 2020-06 further revise the guidance in ASC 260, Earnings Per Share, to require entities to calculate diluted earnings per share (EPS) for convertible instruments by using the if-converted method. In addition, entities must presume share settlement for purposes of calculating diluted EPS when an instrument may be settled in cash or shares. The amendments in ASU 2020-06 are effective for public entities, excluding smaller reporting companies, for fiscal years beginning after December 15, 2021. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements and related disclosures. |
Recently Issued Accounting Standards, Not Yet Adopted | Recently Issued Accounting Standards, Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, “Measurement of Credit Losses on Financial Instruments”. ASU 2016-13 adds a current expected credit loss (“CECL”) impairment model to U.S. GAAP that is based on expected losses rather than incurred losses. Modified retrospective adoption is required with any cumulative-effect adjustment recorded to retained earnings as of the beginning of the period of adoption. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, excluding smaller reporting entities, which will be effective for fiscal years beginning after December 15, 2022. The Company will adopt ASU 2016-13 beginning January 1, 2023 and does not expect the application of the CECL impairment model to have a significant impact on its allowance for uncollectible amounts for accounts receivable. Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA and the SEC did not or are not believed by management to have a material impact on the Company's present or future consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Components of Marketable Securities | The following is a summary of the components of our marketable debt securities and the underlying fair value input level tier hierarchy (see fair value of financial instruments) (in thousands): As of December 31, 2022 Amortized Unrealized Unrealized Fair U.S. government obligations $ 1484 $ 6 $ (12) $ 1478 Corporate obligations 5,702 1,228 (80) 6,850 $ 7,186 $ 1,234 $ (92) $ 8,328 As of December 31, 2021 Amortized Unrealized Unrealized Fair U.S. government obligations $ 650 $ 17 $ — $ 667 Corporate obligations 8,304 — (192) 8,112 $ 8,954 $ 17 $ (192) $ 8,779 |
Schedule of Accounts Receivable Net | Accounts are written off as uncollectible at the time we determine that collections are unlikely. Accounts receivable, net is comprised of the following (in thousands): December 31, 2022 December 31, 2021 Trade accounts receivable $ 37,568 $ 18,520 Unbilled accounts receivable 2,626 23,089 40,194 41,609 Less allowances (3,140) (3,901) Total accounts receivable $ 37,054 $ 37,708 |
Schedule of Components of Inventory | At December 31, 2022 and 2021, the components of inventory are as follows (in thousands): December 31, December 31, Diagnostic services testing material $ 1,739 $ 2,989 Raw materials 1,639 1,514 Work in process 754 260 Finished goods 356 272 Inventory $ 4,488 $ 5,035 Inventory valuation reserve (512) (435) Inventory, net $ 3,976 $ 4,600 |
Schedule of Fair Value of Financial Instruments | As of December 31, 2022 Level 1 Level 2 Level 3 Total U.S. government obligations $ — $ 1,478 $ — $ 1,478 Corporate obligations 5,497 1,354 — 6,851 $ 5,497 $ 2,832 $ — $ 8,329 As of December 31, 2021 Level 1 Level 2 Level 3 Total U.S. government obligations $ — $ 667 $ — $ 667 Corporate obligations — 8,112 — 8,112 Marketable equity securities 76 — — 76 $ 76 $ 8,779 $ — $ 8,855 |
Schedule of Disaggregation of Deferred Revenue | The following table disaggregates our deferred revenue by recognition period (in thousands): As of December 31, 2022 As of December 31, 2021 Recognition Period 0-12 Months $ 2,499 $ 2,034 13-24 Months 683 530 Over 24 Months 376 375 Total $ 3,558 $ 2,939 The following table disaggregates the Company’s revenue by revenue source for Fiscal 2022 and 2021 (in thousands): For the years ended Revenue by Customer Type December 31, 2022 December 31, 2021 Diagnostic services $ 108,329 $ 68,559 Contract manufacturing 8,740 5,786 Retail and others 1,281 2,454 Genomic products and services 4,297 2,243 Total revenue, net $ 122,647 $ 79,042 |
Material Impacts of Adopting ASU | The following tables present the material impacts of adopting ASU No. 2021-08 on the Company’s consolidated balance sheets as of December 31, 2021 (in thousands): As of December, 31 2021 Excluding impacts of adoption of ASU 2021-08 Adjustment Presentation with adoption of ASU 2021-08 Assets Goodwill $ 4,458 $ 1,251 $ 5,709 Liabilities Deferred Revenue $ 2,655 $ 284 $ 2,939 Stockholders’ equity Retained earnings $ 1,675 $ 967 $ 2,642 The following tables present the material impacts of adoption of ASU No. 2021-08 on the Company’s consolidated statements of operations for the year ended December 31, 2021 (in thousands): As of December, 31 2021 Excluding impacts of adoption of ASU 2021-08 Adjustment Presentation with adoption of ASU 2021-08 Revenue $ 78,075 $ 967 $ 79,042 Net income $ 5,306 $ 967 $ 6,273 Comprehensive income $ 5,142 $ 967 $ 6,109 |
Business Acquisitions (Tables)
Business Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Assets Acquired and Liabilities Assumed | Based on the preliminary valuation, the total consideration of $12.7 million, which is net of $1.6 million in cash acquired and $0.3 million anticipated to be paid back to the Company from the Escrow Amount, has been allocated to assets acquired and liabilities assumed based on their respective fair values as follows (in thousands): Account Amount Short term investments $ 1,800 Accounts receivable 222 Inventory 82 Prepaid and other current assets 379 Definite-lived intangible assets 10,990 Total assets acquired 13,473 Accounts payable (805) Accrued expenses and other current liabilities (43) Deferred revenue (2,391) Note payable (81) Deferred tax liability (1,925) Total liabilities assumed (5,245) Net identifiable assets acquired 8,228 Goodwill 4,446 Total consideration, net of cash acquired (1) $ 12,674 (1) Net of $1.6 million cash acquired and $0.3 million anticipated amounts due back to the Company from the escrow account. |
Schedule of Intangible Assets Acquisition | The intangible assets preliminarily identified in conjunction with the Nebula Acquisition are as follows (in thousands): Gross Carrying Value Estimated Useful Trade names $ 5,550 15 Proprietary intellectual property 4,260 5 Customer relationships 1,180 1 Total $ 10,990 |
Schedule of Pro-forma Results | The following table summarizes, on a pro forma basis, the combined results of the Company as though the Nebula Acquisition had occurred as of January 1, 2021. These pro forma results are not necessarily indicative of the actual consolidated results had the acquisition occurred as of that date or of the future consolidated operating results for any period. Pro forma results are (in thousands): For the year ended December 31, 2021 Revenue, net $ 81,164 Net income (loss) $ 6,135 |
Goodwill and Acquired Intangi_2
Goodwill and Acquired Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes In Goodwill | Changes in goodwill for Fiscal 2022 are as follows (in thousands): Amount Goodwill, beginning of Fiscal 2021 $ 901 Acquisition of Nebula 4,446 Adjustment for deferred tax liability 362 Goodwill, end of Fiscal 2021 5,709 Goodwill, end of Fiscal 2022 $ 5,709 |
Schedule of Intangible Assets | Intangible assets as of December 31, 2022 and 2021 consisted of the following (in thousands): December 31, December 31, Estimated Useful Trade names $ 5,550 $ 5,550 15 Proprietary intellectual property 4,260 4,260 5 Customer relationships 1,180 1,180 1 CLIA license 1,307 1,307 3 12,297 12,297 Less: accumulated amortization (3,822) (1,445) Total intangible assets, net $ 8,475 $ 10,852 |
Schedule Estimated Future Amortization Expense of Acquired Intangible Assets | The estimated future amortization expense of acquired intangible assets as of December 31, 2022 is as follows (in thousands): Year ended December 31, 2023 $ 1,585 Year ended December 31, 2024 1,222 Year ended December 31, 2025 1,222 Year ended December 31, 2026 890 Year ended December 31, 2027 370 Thereafter 3,186 $ 8,475 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | The components of property, plant and equipment are as follows (in thousands): December 31, December 31, Estimated Useful Life Land $ 352 $ 352 Building improvements 1,729 1,729 10-39 years Machinery 5,048 4,740 3-7 years Lab equipment 5,788 4,330 3-7 years Computer equipment and software 2,350 1,211 3-5 years Furniture and fixtures 461 468 5 years 15,728 12,830 Less: accumulated depreciation (8,440) (6,883) Total property, plant and equipment, net $ 7,288 $ 5,947 |
Stockholders_ Equity (Tables)
Stockholders’ Equity (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Schedule of Stock Options Activity | The following table summarizes stock options activity during Fiscal 2022 and 2021 (in thousands, except per share data). Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in years) Total Intrinsic Value Outstanding as of January 1, 2021 3,795 2.21 3.4 $ 26,441 Granted 1,825 7.29 6.2 — Forfeited (505) 8.50 0 — Expired (5) 1.39 0 — Outstanding as of December 31, 2021 5,110 $ 3.27 3.4 $ 20,820 Granted 1,095 9.92 7 — Exercised (1,833) 1.29 0 — Forfeited (420) 1.56 0 — Outstanding as of December 31, 2022 3,952 $ 5.35 4 $ 20,379 Options vested and exercisable 2,961 $ 4.06 3.2 $ 17,257 |
Summary of Weighted Average Assumptions Used in Determining Fair Value of Options | The following table summarizes weighted average assumptions used in determining the fair value of the stock options at the date of grant during Fiscal 2022 and 2021: For the years ended 2022 2021 Exercise price $ 10.03 $ 7.29 Expected term (years) 4.5 4 Expected stock price volatility 79 % 79 % Risk-free rate of interest 2.5% 0.8 % Expected dividend yield (per share) 0 % 0 % |
Schedule of Warrant Activity | The following table summarizes warrant activities during Fiscal 2022 and 2021 (in thousands, except per share data): Number of Shares Weighted Average Weighted Average Outstanding as of January 1, 2021 450 $ 3.22 2.7 Warrants granted 455 12.83 3 Cashless exercise (50) 5.00 0 Outstanding as of December 31, 2021 855 $ 8.23 1.9 Warrants granted — — 0 Outstanding as of December 31, 2022 855 $ 8.23 1.9 Warrants vested and exercisable 855 $ 8.23 1.9 |
Summary of Weighted Average Assumptions Used in Determining Fair Value of Warrants | The following table summarizes weighted average assumptions used in determining the fair value of the warrants at the date of grant during Fiscal 2022 and Fiscal 2021: For the years ended 2022 2021 Exercise price $ — $ 12.83 Expected term (years) 0 3.0 Expected stock price volatility 0% 81% Risk-free rate of interest 0.0% 0.2 % Expected dividend yield (per share) 0 % 0 % |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The components of the provision (benefit) for income taxes, in the consolidated statements of operations are as follows (in thousands): For the years ended December 31, 2022 December 31, 2021 Continuing Operations Current Federal $ 1,040 $ — State 3,543 1,318 $ 4,583 $ 1,318 Deferred Federal 72 (1,511) State (210) (775) $ (138) $ (2,286) Income taxes from continuing operations $ 4,445 $ (968) |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of the statutory federal income tax expense (benefit) to the effective tax is as follows (in thousands): 2022 2021 Statutory Rate - federal $ 4,811 $ 1,232 State taxes, net of federal benefit 2,789 366 Research & development tax credit (1,200) — Permanent differences and other (601) 227 Income taxes from continuing operations before valuation allowance $ 5,799 $ 1,825 Change in valuation allowance (1,354) (2,793) Income tax expense (benefit) $ 4,445 $ (968) Total $ 4,445 $ (968) |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of the primary “temporary differences” between values recorded for assets and liabilities for financial reporting purposes and values utilized for measurement in accordance with tax laws giving rise to our deferred tax assets are as follows (in thousands): For the years ended December 31, 2022 December 31, 2021 Net operating loss and capital loss carryforward $ 1,324 $ 3,584 Right of use asset (1,466) 1,348 Other 2,684 2,531 Capital lease obligations 1,466 (1,348) Depreciation (705) (948) Amortization (2,703) (2,989) Valuation allowance (824) (2,178) Total $ (224) $ — |
Other Current Liabilities (Tabl
Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Current Liabilities | The following table sets forth the components of other current liabilities at December 31, 2022 and 2021, respectively (in thousands): December 31, 2022 December 31, 2021 Accrued diagnostic services commissions $ 1,093 $ 1,283 Accrued payroll 202 514 Accrued expenses 714 300 Accrued returns 13 338 Accrued benefits and vacation 50 60 Total other current liabilities $ 2,072 $ 2,495 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Summary of Quantitative Information About Operating Leases | The following summarizes quantitative information about our operating leases (in thousands): For the Years Ended December 31, 2022 December 31, 2021 Operating leases Operating lease cost $ 816 $ 816 Variable lease cost $ — $ — Operating lease expense 816 816 Total rent expense $ 816 $ 816 For the Years Ended December 31, 2022 December 31, 2021 Operating cash flows used in operating leases $ (774) $ (357) Weighted-average remaining lease term – operating leases (in years) 8.5 9.4 Weighted-average discount rate – operating leases 10.00 % 10.00 % |
Schedule of Maturity of Operating Leases | Maturities of the Company’s operating leases, excluding short-term leases, are as follows (in thousands): Year Ended December 31, 2023 $ 739 Year Ended December 31, 2024 747 Year Ended December 31, 2025 768 Year Ended December 31, 2026 783 Year Ended December 31, 2027 804 Thereafter 3,071 Total 6,912 Less present value discount (2,352) Operating lease liabilities $ 4,560 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information | The following table is a summary of segment information for Fiscal 2022 and Fiscal 2021 (in thousands): For the years ended December 31, 2022 December 31, 2021 Net revenues Diagnostic services $ 108,329 $ 68,559 Consumer products 14,318 10,483 Consolidated net revenue 122,647 79,042 Cost of revenue Diagnostic services 39,896 29,415 Consumer products 12,097 7,639 Consolidated cost of revenue 51,993 37,054 Depreciation and amortization expense Diagnostic services 2,336 1,976 Consumer products 2,206 7 Total Depreciation and amortization expense 4,542 1,983 Operating and other expenses 43,203 34,700 Income (loss) from operations, before income taxes Diagnostic services 56,389 18,197 Consumer products (10,824) (1,714) Unallocated corporate (22,657) (11,178) Total income from operations, before income taxes 22,908 5,305 Income tax benefit (expense) (4,445) 968 Net Income $ 18,463 $ 6,273 The following table is a summary of segment information for Fiscal 2022 and Fiscal 2021 (in thousands): December 31, December 31, ASSETS Diagnostic services $ 50,832 $ 51,150 Consumer products 22,080 24,139 Unallocated corporate 14,736 14,006 Total assets $ 87,648 $ 89,295 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Net Loss Per Share | The following is a reconciliation of the weighted average number of common shares outstanding used in calculating basic and diluted net loss per share (in thousands): For the years ended December 31, 2022 December 31, 2021 Net income - basic $ 18,464 $ 6,273 Interest on unsecured convertible promissory note 632 1,000 Net income - diluted $ 19,096 $ 7,273 Weighted average shares outstanding - basic 15,845 15,172 Diluted shares- Stock Options 1,493 2,001 Diluted shares- Stock Warrants 1,073 220 Unsecured convertible promissory note 240 1,000 Weighted average shares outstanding - diluted $ 18,651 $ 18,393 |
Schedule of Anti-dilutive Securities Excluded from the Income Per Share Computation | The following table represents the number of securities excluded from the income per share computation as a result of their anti-dilutive effect (in thousands): For the years ended Anti-dilutive securities December 31, 2022 December 31, 2021 Common stock purchase warrants 455 455 Stock Options 770 828 Unsecured convertible promissory note — — Anti-dilutive securities 1,225 1,283 |
Organization and Business - Nar
Organization and Business - Narrative (Details) $ in Millions | 1 Months Ended | ||
Jun. 30, 2022 numberOfLicensedCompound | Oct. 31, 2020 USD ($) ft² | Dec. 08, 2020 ft² | |
Business Acquisition [Line Items] | |||
Area of real estate property | 4,500 | ||
Number of licensed compounds | numberOfLicensedCompound | 2 | ||
CPM Acquisition | |||
Business Acquisition [Line Items] | |||
Area of real estate property | 4,000 | ||
Total consideration | $ | $ 2.5 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Summary of Components of Marketable Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Amortized Cost | $ 7,186 | $ 8,954 |
Unrealized Gains | 1,234 | 17 |
Unrealized Losses | (92) | (192) |
Fair Value | 8,328 | 8,779 |
U.S. government obligations | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Amortized Cost | 1,484 | 650 |
Unrealized Gains | 6 | 17 |
Unrealized Losses | (12) | 0 |
Fair Value | 1,478 | 667 |
Corporate obligations | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Amortized Cost | 5,702 | 8,304 |
Unrealized Gains | 1,228 | 0 |
Unrealized Losses | (80) | (192) |
Fair Value | $ 6,850 | $ 8,112 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Accounts Receivable Net (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Accounting Policies [Abstract] | ||
Trade accounts receivable | $ 37,568 | $ 18,520 |
Unbilled accounts receivable | 2,626 | 23,089 |
Accounts Receivable, before Allowance for Credit Loss | 40,194 | 41,609 |
Less allowances | (3,140) | (3,901) |
Total accounts receivable | $ 37,054 | $ 37,708 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Schedule of Components of Inventory (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Accounting Policies [Abstract] | ||
Diagnostic services testing material | $ 1,739 | $ 2,989 |
Raw materials | 1,639 | 1,514 |
Work in process | 754 | 260 |
Finished goods | 356 | 272 |
Inventory | 4,488 | 5,035 |
Inventory valuation reserve | (512) | (435) |
Inventory, net | $ 3,976 | $ 4,600 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Schedule of Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | $ 8,329 | $ 8,855 |
Level 1 | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | 5,497 | 76 |
Level 2 | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | 2,832 | 8,779 |
Level 3 | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | 0 | 0 |
U.S. government obligations | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | 1,478 | 667 |
U.S. government obligations | Level 1 | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | 0 | 0 |
U.S. government obligations | Level 2 | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | 1,478 | 667 |
U.S. government obligations | Level 3 | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | 0 | 0 |
Corporate obligations | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | 6,851 | 8,112 |
Corporate obligations | Level 1 | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | 5,497 | 0 |
Corporate obligations | Level 2 | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | 1,354 | 8,112 |
Corporate obligations | Level 3 | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | $ 0 | 0 |
Marketable equity securities | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | 76 | |
Marketable equity securities | Level 1 | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | 76 | |
Marketable equity securities | Level 2 | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | 0 | |
Marketable equity securities | Level 3 | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Marketable Securities | $ 0 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Schedule of Deferred Revenue (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Accounting Policies [Abstract] | ||
Deferred revenue | $ 3,558 | $ 2,939 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Performance Obligation (Details) | Dec. 31, 2022 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Deferred Revenue Arrangement [Line Items] | |
Expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Deferred Revenue Arrangement [Line Items] | |
Expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Deferred Revenue Arrangement [Line Items] | |
Expected timing of satisfaction, period |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Schedule of Disaggregation by Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Product Information [Line Items] | ||
Total revenue, net | $ 122,647 | $ 79,042 |
Diagnostic services | ||
Product Information [Line Items] | ||
Total revenue, net | 108,329 | 68,559 |
Contract manufacturing | ||
Product Information [Line Items] | ||
Total revenue, net | 8,740 | 5,786 |
Retail and others | ||
Product Information [Line Items] | ||
Total revenue, net | 1,281 | 2,454 |
Genomic products and services | ||
Product Information [Line Items] | ||
Total revenue, net | $ 4,297 | $ 2,243 |
Summary of Significant Accou_11
Summary of Significant Accounting Policies - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Jun. 25, 2021 | |
Property, Plant and Equipment [Line Items] | |||
Operating activities | $ 28,551,000 | $ (13,619,000) | |
Cash equivalents and marketable securities | 17,400,000 | ||
Escrow amount | 250,000 | 250,000 | |
Allowance for doubtful accounts period increase (decrease) | 5,500,000 | ||
Accounts receivable | 3,140,000 | 3,901,000 | |
Cash, cash equivalents, and restricted cash | 9,100,000 | ||
Federal depository insurance | 1,000,000 | ||
Bank balance uninsured | 8,400,000 | ||
Revenue recognition, subscriptions | 1,000,000 | ||
Contract balance, deferred revenue | 3,600,000 | 2,939,000 | |
Deferred revenue | 3,500,000 | ||
Research and development | 652,000 | 520,000 | |
Impairment charges | $ 0 | 0 | |
Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 5 years | ||
Trade Accounts Receivable | |||
Property, Plant and Equipment [Line Items] | |||
Bad debt expense | $ 5,900,000 | 2,900,000 | |
Revision of Prior Period, Adjustment | |||
Property, Plant and Equipment [Line Items] | |||
Contract balance, deferred revenue | 284,000 | ||
Accounting Standards Update 2021-08 | |||
Property, Plant and Equipment [Line Items] | |||
Contract balance, deferred revenue | 2,655,000 | ||
Cooperative Incentive Promotion Costs | |||
Property, Plant and Equipment [Line Items] | |||
Advertising expense | 400,000 | 400,000 | |
Investment Shares | |||
Property, Plant and Equipment [Line Items] | |||
Investment shares (in shares) | 1,260,619 | ||
Investments owned | 0 | $ 76,000 | $ 315,000 |
Decrease in fair value of investment securities | $ 76,000 | ||
Minimum | Building and Building Improvements | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 10 years | ||
Minimum | Machinery | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 3 years | ||
Minimum | Computer equipment and software | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 3 years | ||
Minimum | Marketable Securities | |||
Property, Plant and Equipment [Line Items] | |||
Interest rates | 1.40% | ||
Maximum | Building and Building Improvements | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 39 years | ||
Maximum | Machinery | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 7 years | ||
Maximum | Computer equipment and software | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life (in years) | 5 years | ||
Maximum | Marketable Securities | |||
Property, Plant and Equipment [Line Items] | |||
Interest rates | 4.90% |
Summary of Significant Accou_12
Summary of Significant Accounting Policies - Material Impacts of Adopting ASU (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Goodwill | $ 5,709 | $ 5,709 | $ 901 |
Deferred Revenue | 3,600 | 2,939 | |
Retained earnings | 11,753 | 2,642 | |
Revenues, net | 122,647 | 79,042 | |
Net Income | 18,463 | 6,273 | |
Comprehensive income | $ 19,395 | 6,109 | |
Revision of Prior Period, Adjustment | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Goodwill | 1,251 | ||
Deferred Revenue | 284 | ||
Retained earnings | 967 | ||
Revenues, net | 967 | ||
Net Income | 967 | ||
Comprehensive income | 967 | ||
Accounting Standards Update 2021-08 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Goodwill | 4,458 | ||
Deferred Revenue | 2,655 | ||
Retained earnings | 1,675 | ||
Revenues, net | 78,075 | ||
Net Income | 5,306 | ||
Comprehensive income | $ 5,142 |
Business Acquisitions - Narrati
Business Acquisitions - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||||
Mar. 08, 2023 | Aug. 10, 2021 | Aug. 10, 2021 | Oct. 31, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | |||||||
Purchase price | $ 2,152 | $ 917 | |||||
Escrow amount | $ 250 | $ 250 | |||||
Exercise price (in dollars per share) | $ 10.03 | $ 7.29 | |||||
Amortization expense | $ 2,400 | $ 1,400 | |||||
Goodwill | 5,709 | 5,709 | $ 901 | ||||
Nebula Acquisition | |||||||
Business Acquisition [Line Items] | |||||||
Purchase price, paid in shares | $ 3,600 | ||||||
Cash acquired from acquisition | $ 1,600 | ||||||
Amount to be paid back from escrow | 300 | ||||||
Amortization expense | $ 1,900 | $ 900 | |||||
Total consideration | 12,700 | ||||||
Goodwill | 4,446 | 4,446 | |||||
Total assets acquired | $ 13,473 | 13,473 | |||||
Nebula Acquisition | Subsequent Event | |||||||
Business Acquisition [Line Items] | |||||||
Amount to be paid back from escrow | $ 600 | ||||||
Return Portion Of Purchase Price, Related to Escrow Agreement | $ 500 | ||||||
Nebula Acquisition | Mr. Kamal Obbad | |||||||
Business Acquisition [Line Items] | |||||||
Option to purchase shares (in shares) | 250,000 | ||||||
Exercise price (in dollars per share) | $ 7.67 | ||||||
Nebula Acquisition | Nebula Stock Purchase Agreement | |||||||
Business Acquisition [Line Items] | |||||||
Purchase price | $ 14,600 | ||||||
Shares issued (in dollars per share) | $ 7.46 | $ 7.46 | |||||
Nebula Acquisition | Nebula Stock Purchase Agreement | CitiBank, N.A. | |||||||
Business Acquisition [Line Items] | |||||||
Escrow amount | $ 1,080 | $ 1,080 | |||||
CPM Acquisition | |||||||
Business Acquisition [Line Items] | |||||||
Total consideration | $ 2,500 |
Business Acquisitions - Schedul
Business Acquisitions - Schedule of Assets Acquired and Liabilities Assumed - Nebula Acquisition (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Aug. 10, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 5,709 | $ 5,709 | $ 901 | |
Nebula Acquisition | ||||
Business Acquisition [Line Items] | ||||
Short term investments | $ 1,800 | |||
Accounts receivable | 222 | |||
Inventory | 82 | |||
Prepaid and other current assets | 379 | |||
Definite-lived intangible assets | 10,990 | |||
Total assets acquired | 13,473 | |||
Accounts payable | (805) | |||
Accrued expenses and other current liabilities | (43) | |||
Deferred revenue | (2,391) | |||
Note payable | (81) | |||
Deferred tax liability | (1,925) | |||
Total liabilities assumed | (5,245) | |||
Net identifiable assets acquired | 8,228 | |||
Goodwill | 4,446 | |||
Total consideration, net of cash acquired | $ 12,674 |
Business Acquisitions - Sched_2
Business Acquisitions - Schedule of Assets Acquired and Liabilities Assumed (Details) (Parenthetical) - Nebula Acquisition $ in Millions | Aug. 10, 2021 USD ($) |
Business Acquisition [Line Items] | |
Cash acquired from acquisition | $ 1.6 |
Amount to be paid back from escrow | $ 0.3 |
Business Acquisitions - Sched_3
Business Acquisitions - Schedule of Intangible Assets Acquisition (Details) - USD ($) $ in Thousands | Aug. 10, 2021 | Dec. 31, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | |||
Gross Carrying Value | $ 12,297 | $ 12,297 | |
Trade names | |||
Business Acquisition [Line Items] | |||
Gross Carrying Value | 5,550 | 5,550 | |
Proprietary intellectual property | |||
Business Acquisition [Line Items] | |||
Gross Carrying Value | 4,260 | 4,260 | |
Customer relationships | |||
Business Acquisition [Line Items] | |||
Gross Carrying Value | $ 1,180 | $ 1,180 | |
Nebula Acquisition | |||
Business Acquisition [Line Items] | |||
Gross Carrying Value | $ 10,990 | ||
Nebula Acquisition | Trade names | |||
Business Acquisition [Line Items] | |||
Gross Carrying Value | $ 5,550 | ||
Estimated Useful Life (in years) | 15 years | ||
Nebula Acquisition | Proprietary intellectual property | |||
Business Acquisition [Line Items] | |||
Gross Carrying Value | $ 4,260 | ||
Estimated Useful Life (in years) | 5 years | ||
Nebula Acquisition | Customer relationships | |||
Business Acquisition [Line Items] | |||
Gross Carrying Value | $ 1,180 | ||
Estimated Useful Life (in years) | 1 year |
Business Acquisitions - Sched_4
Business Acquisitions - Schedule of Pro-forma Results (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Business Combination and Asset Acquisition [Abstract] | |
Revenue, net | $ 81,164 |
Net income (loss) | $ 6,135 |
Goodwill and Acquired Intangi_3
Goodwill and Acquired Intangible Assets - Schedule of Changes In Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2022 | |
Goodwill [Roll Forward] | ||
Goodwill, beginning of Fiscal 2021 | $ 901 | |
Acquisition of Nebula | 4,446 | |
Goodwill, end of Fiscal 2021 | 5,709 | $ 5,709 |
Adjustment for deferred tax liability | 362 | |
Goodwill, end of Fiscal 2022 | $ 5,709 |
Goodwill and Acquired Intangi_4
Goodwill and Acquired Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, gross | $ 12,297 | $ 12,297 |
Less: accumulated amortization | (3,822) | (1,445) |
Total intangible assets, net | 8,475 | 10,852 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, gross | $ 5,550 | 5,550 |
Estimated Useful Life (in years) | 15 years | |
Proprietary intellectual property | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, gross | $ 4,260 | 4,260 |
Estimated Useful Life (in years) | 5 years | |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, gross | $ 1,180 | 1,180 |
Estimated Useful Life (in years) | 1 year | |
CLIA license | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, gross | $ 1,307 | $ 1,307 |
Estimated Useful Life (in years) | 3 years |
Goodwill and Acquired Intangi_5
Goodwill and Acquired Intangible Assets - Schedule Estimated Future Amortization Expense of Acquired Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 2,400 | $ 1,400 |
Year ended December 31, 2023 | 1,585 | |
Year ended December 31, 2024 | 1,222 | |
Year ended December 31, 2025 | 1,222 | |
Year ended December 31, 2026 | 890 | |
Year ended December 31, 2027 | 370 | |
Thereafter | 3,186 | |
Total intangible assets, net | $ 8,475 | $ 10,852 |
Property, Plant, and Equipment
Property, Plant, and Equipment - Schedule of Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 15,728 | $ 12,830 |
Less: accumulated depreciation | (8,440) | (6,883) |
Total property, plant and equipment, net | 7,288 | 5,947 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 352 | 352 |
Building improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 1,729 | 1,729 |
Building improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life (in years) | 10 years | |
Building improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life (in years) | 39 years | |
Machinery | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 5,048 | 4,740 |
Machinery | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life (in years) | 3 years | |
Machinery | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life (in years) | 7 years | |
Lab equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 5,788 | 4,330 |
Lab equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life (in years) | 3 years | |
Lab equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life (in years) | 7 years | |
Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 2,350 | 1,211 |
Computer equipment and software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life (in years) | 3 years | |
Computer equipment and software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life (in years) | 5 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 461 | $ 468 |
Estimated useful life (in years) | 5 years |
Property, Plant and Equipment -
Property, Plant and Equipment - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 2.3 | $ 1.9 |
Unsecured Convertible Promiss_2
Unsecured Convertible Promissory Notes Payable - Narrative (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Feb. 28, 2022 | Nov. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Sep. 15, 2020 | |
Short-term Debt [Line Items] | |||||
Conversion price (in dollars per share) | $ 5.75 | ||||
Cash | $ 1,440,548 | ||||
Remaining principal amount | 1,400,000 | ||||
Interest payable | 40,548 | ||||
Debt conversion, principal amount | 1,150,000 | ||||
Aggregate payment | 2,590,548 | ||||
Unsecured Debt | |||||
Short-term Debt [Line Items] | |||||
Aggregate principal amount | $ 600,000 | ||||
Common stock issued (in shares) | 200,000 | ||||
Conversion price (in dollars per share) | $ 3 | ||||
Unsecured Debt | Letter Agreement | |||||
Short-term Debt [Line Items] | |||||
Aggregate principal amount | $ 2,000,000 | ||||
September 2020 Notes | Unsecured Debt | |||||
Short-term Debt [Line Items] | |||||
Aggregate principal amount | $ 10,000,000 | ||||
Conversion price (in dollars per share) | $ 3 | ||||
Interest rate | 10% | ||||
Convertible debt | $ 3,000,000 | ||||
Principal payment | $ 5,600,000 | ||||
Interest expense | $ 800,000 | $ 1,000,000 |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) | 1 Months Ended | 12 Months Ended | 57 Months Ended | ||||||||||||||||||||||||
Mar. 15, 2023 USD ($) | Oct. 04, 2022 USD ($) | Jun. 03, 2022 USD ($) $ / shares | May 25, 2022 USD ($) | May 09, 2022 $ / shares shares | Mar. 01, 2022 USD ($) | Feb. 14, 2022 $ / shares | Dec. 28, 2021 USD ($) | Sep. 08, 2021 | Aug. 10, 2021 $ / shares | Jun. 03, 2021 USD ($) $ / shares | May 20, 2021 shares | Jan. 21, 2021 USD ($) $ / shares shares | Jan. 18, 2021 $ / shares shares | Jan. 05, 2021 USD ($) $ / shares shares | Dec. 12, 2019 $ / shares | Jan. 24, 2019 $ / shares | Sep. 05, 2018 $ / shares | Apr. 12, 2018 shares | Jan. 31, 2023 shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2020 | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 15, 2022 $ / shares | May 19, 2022 shares | Dec. 07, 2021 USD ($) | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Common stock, authorized (in shares) | 50,000,000 | 50,000,000 | 50,000,000 | ||||||||||||||||||||||||
Common stock, par or stated value (in dollars per share) | $ / shares | $ 0.0005 | $ 0.0005 | $ 0.0005 | $ 0.0005 | |||||||||||||||||||||||
Preferred stock, authorized (in shares) | 1,000,000 | 1,000,000 | 1,000,000 | ||||||||||||||||||||||||
Preferred stock, par or stated value (in dollars per share) | $ / shares | $ 0.0005 | $ 0.0005 | $ 0.0005 | ||||||||||||||||||||||||
Preferred stock, issued (in shares) | 0 | 0 | 0 | ||||||||||||||||||||||||
Special cash dividend (in dollars per share) | $ / shares | $ 0.30 | $ 0.30 | $ 0.30 | ||||||||||||||||||||||||
Payment to stockholders | $ | $ 4,700,000 | $ 4,600,000 | $ 4,500,000 | ||||||||||||||||||||||||
Proceeds from issuance initial public offering | $ | $ 0 | $ 35,135,000 | |||||||||||||||||||||||||
Accountable expenses | $ | $ 5,905,000 | $ 7,026,000 | $ 5,905,000 | ||||||||||||||||||||||||
Fee, percent of sales | 1% | ||||||||||||||||||||||||||
Stock repurchase program, term (in months) | 6 months | ||||||||||||||||||||||||||
Future issuance (in shares) | 2,961,000 | 2,961,000 | |||||||||||||||||||||||||
Stock options outstanding (in shares) | 3,952,000 | 3,952,000 | |||||||||||||||||||||||||
Issuance of common stock upon stock options cashless exercise (in shares) | 1,833,000 | ||||||||||||||||||||||||||
Exercise price (in dollars per share) | $ / shares | $ 10.03 | $ 7.29 | |||||||||||||||||||||||||
Tax withholding cost | $ | $ 7,474,000 | ||||||||||||||||||||||||||
Share-based compensation expense | $ | $ 4,500,000 | ||||||||||||||||||||||||||
Weighted average period (in years) | 3 years | ||||||||||||||||||||||||||
Subsequent Event | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Authorized amount | $ | $ 6,000,000 | ||||||||||||||||||||||||||
Stock repurchase program, term (in months) | 6 months | ||||||||||||||||||||||||||
Issuance of common stock upon stock options cashless exercise (in shares) | 1,348,250 | ||||||||||||||||||||||||||
Over-Allotment Option | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Shares sold in public offering, common stock, percent | 6% | ||||||||||||||||||||||||||
Employees and Non-Employees | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Shares purchased (in shares) | 1,095,000 | ||||||||||||||||||||||||||
Fair value of stock options | $ | $ 6,600,000 | $ 6,100,000 | |||||||||||||||||||||||||
2010 Director's Equity Compensation Plan | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Shares authorized (in shares) | 775,000 | ||||||||||||||||||||||||||
Amended 2010 Plan | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Common stock issued (in shares) | 4,900,000 | ||||||||||||||||||||||||||
2010 Equity Compensation Plan | Employees and Non-Employees | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Shares purchased (in shares) | 325,000 | 1,249,874 | |||||||||||||||||||||||||
Exercise price, upper range (in dollars per share) | $ / shares | $ 12.01 | ||||||||||||||||||||||||||
Vesting period (in years) | 3 years | 3 years | |||||||||||||||||||||||||
Exercise price, lower range (in dollars per share) | $ / shares | $ 8.96 | ||||||||||||||||||||||||||
2010 Equity Compensation Plan | Employees and Non-Employees | Vesting Period One | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Award vesting rights, percentage | 25% | 25% | |||||||||||||||||||||||||
2010 Equity Compensation Plan | Employees and Non-Employees | Vesting Period Two | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Award vesting rights, percentage | 75% | 75% | |||||||||||||||||||||||||
2018 Stock Incentive Plan | Chief Executive Officer | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Shares purchased (in shares) | 2,300,000 | ||||||||||||||||||||||||||
Issuance of common stock upon stock options cashless exercise (in shares) | 1,650,000 | ||||||||||||||||||||||||||
Shares issued (in shares) | 2,300,000 | ||||||||||||||||||||||||||
2018 Stock | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Fair value of stock options | $ | $ 6,900,000 | $ 6,100,000 | |||||||||||||||||||||||||
Share-based compensation expense | $ | $ 4,000,000 | 3,200,000 | |||||||||||||||||||||||||
2022 Directors Plan | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Future issuance (in shares) | 180,000 | 180,000 | 300,000 | ||||||||||||||||||||||||
Stock options outstanding (in shares) | 120,000 | 120,000 | |||||||||||||||||||||||||
2022 Plan | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Future issuance (in shares) | 5,900,000 | ||||||||||||||||||||||||||
Increase in shares for issuance (in shares) | 1,000,000 | ||||||||||||||||||||||||||
Share Repurchase Program | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Authorized amount | $ | $ 2,152,000 | $ 944,000 | $ 2,152,000 | ||||||||||||||||||||||||
Stock repurchased (in shares) | 303,145,000 | 166,824 | |||||||||||||||||||||||||
Nebula Acquisition | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Common stock issued (in shares) | 483,685 | ||||||||||||||||||||||||||
Business acquisition, share price (in dollars per share) | $ / shares | $ 7.46 | $ 7.46 | |||||||||||||||||||||||||
Cash payment | $ | $ 3,600,000 | ||||||||||||||||||||||||||
Nebula Acquisition | Mr. Kamal Obbad | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Exercise price (in dollars per share) | $ / shares | $ 7.67 | ||||||||||||||||||||||||||
Inducement Option Award | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Business acquisition, share price (in dollars per share) | $ / shares | $ 7.67 | $ 7.67 | |||||||||||||||||||||||||
Exercise price, lower range (in dollars per share) | $ / shares | $ 6.74 | ||||||||||||||||||||||||||
Inducement award amount | $ | $ 1,128,000 | ||||||||||||||||||||||||||
Minimum | Employees and Non-Employees | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Exercise price, lower range (in dollars per share) | $ / shares | $ 6.44 | ||||||||||||||||||||||||||
Minimum | 2010 Equity Compensation Plan | Employees and Non-Employees | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Exercise price, upper range (in dollars per share) | $ / shares | $ 5.28 | ||||||||||||||||||||||||||
Exercise price, lower range (in dollars per share) | $ / shares | 5.28 | ||||||||||||||||||||||||||
Maximum | Employees and Non-Employees | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Exercise price, upper range (in dollars per share) | $ / shares | $ 12.92 | ||||||||||||||||||||||||||
Maximum | 2010 Equity Compensation Plan | Employees and Non-Employees | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Exercise price, upper range (in dollars per share) | $ / shares | $ 11.03 | ||||||||||||||||||||||||||
Registered Direct Offering | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Common stock issued (in shares) | 550,000 | ||||||||||||||||||||||||||
Warrants (in shares) | 275,000 | ||||||||||||||||||||||||||
Shares issued (in dollars per share) | $ / shares | $ 10 | ||||||||||||||||||||||||||
Proceeds from issuance of warrants | $ | $ 5,500,000 | ||||||||||||||||||||||||||
Warrants (in dollars per share) | $ / shares | $ 11 | ||||||||||||||||||||||||||
IPO | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Common stock issued (in shares) | 3,000,000 | ||||||||||||||||||||||||||
Warrants (in shares) | 180,000 | ||||||||||||||||||||||||||
Shares issued (in dollars per share) | $ / shares | $ 12.50 | ||||||||||||||||||||||||||
Warrants (in dollars per share) | $ / shares | $ 15.625 | ||||||||||||||||||||||||||
Proceeds from issuance initial public offering | $ | $ 35,100,000 | ||||||||||||||||||||||||||
Public offering price per share, exercise price, percent | 125% | ||||||||||||||||||||||||||
At the Market Offering | Sales Agreement | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Offering cost | $ | $ 100,000,000 | ||||||||||||||||||||||||||
Commission rate | 0.020 | ||||||||||||||||||||||||||
Accountable expenses | $ | $ 60,000 | $ 25,000 | |||||||||||||||||||||||||
Legal fees | $ | 50,000 | ||||||||||||||||||||||||||
At the Market Offering | Sales Agreement | Maximum | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Offering cost | $ | $ 3,000 | ||||||||||||||||||||||||||
CEO Options | 2018 Stock | Stockholders | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Special cash dividend (in dollars per share) | $ / shares | $ 0.30 | $ 0.25 | $ 0.25 | $ 1 | |||||||||||||||||||||||
Exercise price, lower range (in dollars per share) | $ / shares | $ 0.60 | ||||||||||||||||||||||||||
CEO Options | Minimum | 2018 Stock | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Exercise price, upper range (in dollars per share) | $ / shares | 1.20 | 1.50 | 1.75 | 2 | |||||||||||||||||||||||
CEO Options | Maximum | 2018 Stock Incentive Plan | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Exercise price, lower range (in dollars per share) | $ / shares | $ 3 | ||||||||||||||||||||||||||
CEO Options | Maximum | 2018 Stock | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Exercise price, upper range (in dollars per share) | $ / shares | 2 | ||||||||||||||||||||||||||
Exercise price, lower range (in dollars per share) | $ / shares | $ 1.50 | 1.75 | $ 2 | ||||||||||||||||||||||||
Inducement Option Award | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Shares purchased (in shares) | 100,000 | ||||||||||||||||||||||||||
Award vesting rights, percentage | 25% | ||||||||||||||||||||||||||
Inducement award (in shares) | 250,000 | ||||||||||||||||||||||||||
Exercise price (in dollars per share) | $ / shares | $ 5.76 | ||||||||||||||||||||||||||
Inducement Option Award | Vesting Period One | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Award vesting rights, percentage | 50% | ||||||||||||||||||||||||||
Inducement Option Award | Vesting Period Two | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Award vesting rights, percentage | 25% | ||||||||||||||||||||||||||
Inducement Option Award | Mr. Kamal Obbad | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Shares authorized (in shares) | 400,000 | 250,000 | 250,000 | ||||||||||||||||||||||||
CFO Award | 2018 Stock Incentive Plan | Chief Financial Officer | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Special cash dividend (in dollars per share) | $ / shares | $ 0.30 | ||||||||||||||||||||||||||
Inducement award amount | $ | $ 1,604,000 | ||||||||||||||||||||||||||
Reversal of stock based compensation expense | $ | $ 149,000 | ||||||||||||||||||||||||||
CFO Award | Minimum | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Exercise price, upper range (in dollars per share) | $ / shares | 6.44 | ||||||||||||||||||||||||||
CFO Award | Maximum | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Exercise price, lower range (in dollars per share) | $ / shares | $ 6.74 | ||||||||||||||||||||||||||
Common Stock | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Stock repurchased (in shares) | 303,145 | 166,824 | |||||||||||||||||||||||||
Issuance of common stock upon stock options cashless exercise (in shares) | 828,021 | ||||||||||||||||||||||||||
Shares issued (in shares) | 828,021 | ||||||||||||||||||||||||||
Shares withheld for tax withholding obligation | 1,103,000 | ||||||||||||||||||||||||||
Common stock repurchased | $ | $ 7,500,000 | ||||||||||||||||||||||||||
Common Stock | Subsequent Event | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Stock repurchased (in shares) | 744,369 | ||||||||||||||||||||||||||
Issuance of common stock upon stock options cashless exercise (in shares) | 603,881 | ||||||||||||||||||||||||||
Common Stock | 2010 Director's Equity Compensation Plan | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Shares purchased (in shares) | 225,126 | ||||||||||||||||||||||||||
Shares issued (in dollars per share) | $ / shares | $ 5.28 | ||||||||||||||||||||||||||
Common Stock | 2022 Directors Plan | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Shares purchased (in shares) | 120,000 | ||||||||||||||||||||||||||
Shares issued (in dollars per share) | $ / shares | $ 5.28 | $ 5.28 | |||||||||||||||||||||||||
Common Stock | Inducement Option Award | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Shares issued (in dollars per share) | $ / shares | $ 13 | $ 13 | |||||||||||||||||||||||||
Warrant | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Warrants (in shares) | 5,986 | 5,986 | |||||||||||||||||||||||||
Cashless exercise of stock (in shares) | 50,000 | ||||||||||||||||||||||||||
Warrants outstanding (in shares) | 855,000 | 855,000 | |||||||||||||||||||||||||
Share-based compensation expense | $ | $ 253,000 | ||||||||||||||||||||||||||
Weighted average period (in years) | 1 year 10 months 24 days | 2 years 8 months 12 days | |||||||||||||||||||||||||
Warrant | Registered Direct Offering | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Warrants (in shares) | 275,000 | 275,000 | |||||||||||||||||||||||||
Warrant | IPO | |||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||
Warrants (in shares) | 180,000 | 180,000 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Stock Options Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Number of Shares | |||
Number of Shares, outstanding, beginning (in shares) | |||
Number of Shares, exercised (in shares) | 1,833,000 | ||
Number of Shares, outstanding, ending (in shares) | 3,952,000 | ||
Weighted Average Exercise Price | |||
Weighted average exercise price, granted (in dollars per share) | $ 10.03 | $ 7.29 | |
Weighted Average Remaining Contractual Life, outstanding shares (in years) | 3 years | ||
Weighted Average Remaining Contractual Life, granted shares (in years) | 7 years | 6 years 2 months 12 days | |
Weighted Average Remaining Contractual Life, options vested and exercisable (in years) | 3 years 2 months 12 days | ||
Equity Option | |||
Number of Shares | |||
Number of Shares, outstanding, beginning (in shares) | 5,110,000 | 3,795,000 | |
Number of Shares, granted (in shares) | (1,095,000) | (1,825,000) | |
Number of Shares, forfeited (in shares) | 420,000 | 505,000 | |
Number of Shares, expired (in shares) | 5,000 | ||
Number of Shares, exercised (in shares) | 1,833,000 | ||
Number of Shares, outstanding, ending (in shares) | 3,952,000 | 5,110,000 | 3,795,000 |
Number of Shares, options vested and exercisable (in shares) | 2,961,000 | ||
Weighted Average Exercise Price | |||
Weighted average exercise price, outstanding, beginning (in dollars per share) | $ 3.27 | $ 2.21 | |
Weighted average exercise price, granted (in dollars per share) | 9.92 | 7.29 | |
Weighted average exercise price, forfeited (in dollars per share) | 1.56 | 8.50 | |
Weighted average exercise price, expired (in dollars per share) | 1.39 | ||
Weighted average exercise price, exercised (in dollars per share) | 1.29 | ||
Weighted average exercise price, outstanding, ending (in dollars per share) | 5.35 | $ 3.27 | $ 2.21 |
Weighted average exercise price, options vested and exercisable (in dollars per share) | $ 4.06 | ||
Weighted Average Remaining Contractual Life, outstanding shares (in years) | 4 years | 3 years 4 months 24 days | 3 years 4 months 24 days |
Total Intrinsic Value, beginning | $ 20,820 | $ 26,441 | |
Total Intrinsic Value, ending | 20,379 | $ 20,820 | $ 26,441 |
Options vested and exercisable | $ 17,257 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Weighted Average Assumptions Used in Determining Fair Value of Options (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Equity [Abstract] | ||
Exercise price (in dollars per share) | $ 10.03 | $ 7.29 |
Expected term (years) | 4 years 6 months | 4 years |
Expected stock price volatility | 79% | 79% |
Risk-free rate of interest | 250% | 0.80% |
Expected dividend yield (per share) | 0% | 0% |
Stockholders' Equity - Schedu_2
Stockholders' Equity - Schedule of Warrant Activity (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Warrants and Rights Note Disclosure [Abstract] | |||
SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2 | 3 years | ||
SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2 | 3 years | ||
Warrant | |||
Number of Shares | |||
Number of Shares, warrants outstanding, beginning (in shares) | 855,000 | 450,000 | |
Number of Shares, warrants granted (in shares) | 0 | 455,000 | |
Number of Shares, cashless exercise (in shares) | (50,000) | ||
Number of Shares, warrants outstanding, ending (in shares) | 855,000 | 855,000 | 450,000 |
Share-based Compensation, Shares Authorized, Under Stock Option Plans, Exercise Price Range, Granted, Options, Weighted Average, Remaining Contractual Term 2 | 0 years | 3 years | |
Number of Shares, warrants vested and exercisable (in shares) | 855,000 | ||
Warrants and Rights Note Disclosure [Abstract] | |||
Weighted Average Exercise Price, warrants outstanding, beginning (in dollars per share) | $ 8.23 | $ 3.22 | |
Weighted Average Exercise Price, warrants granted (in dollars per share) | 0 | 12.83 | |
Weighted Average Exercise Price Warrants Outstanding, cashless exercise (in dollars per share) | 5 | ||
Weighted Average Exercise Price, warrants vested and exercisable (in dollars per share) | 8.23 | ||
Weighted Average Exercise Price, warrants outstanding, ending (in dollars per share) | $ 8.23 | $ 8.23 | $ 3.22 |
SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2 | 1 year 10 months 24 days | 2 years 8 months 12 days | |
Weighted Average Remaining Contractual Life, cashless exercise (in years) | 1 year 10 months 24 days | 0 years | |
SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2 | 1 year 10 months 24 days | 2 years 8 months 12 days | |
Weighted Average Remaining Contractual Life, warrants vested and exercisable (in years) | 1 year 10 months 24 days |
Stockholders' Equity - Summar_2
Stockholders' Equity - Summary of Weighted Average Assumptions Used in Determining Fair Value of Warrants (Details) - Warrant | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) |
Exercise price | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Warrants outstanding, measurement input | 0 | 12.83 |
Expected stock price volatility | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Warrants outstanding, measurement input | 0 | 81 |
Risk-free rate of interest | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Warrants outstanding, measurement input | 0 | 0.002 |
Expected dividend yield (per share) | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Warrants outstanding, measurement input | 0 | 0 |
Expected term (years) | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Warrants outstanding, term (in years) | 0 years | 3 years |
Defined Contribution Plans (Det
Defined Contribution Plans (Details Narrative) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Retirement Benefits [Abstract] | ||
Contribution amount | $ 0.2 | $ 0.1 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Current | ||
Federal | $ 1,040 | $ 0 |
State | 3,543 | 1,318 |
Current Total | 4,583 | 1,318 |
Deferred | ||
Federal | 72 | (1,511) |
State | (210) | (775) |
Deferred Total | (138) | (2,286) |
Income taxes from continuing operations | $ 4,445 | $ (968) |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Statutory Rate - federal | $ 4,811 | $ 1,232 |
State taxes, net of federal benefit | 2,789 | 366 |
Research & development tax credit | (1,200) | 0 |
Permanent differences and other | (601) | 227 |
Income taxes from continuing operations before valuation allowance | 5,799 | 1,825 |
Change in valuation allowance | (1,354) | (2,793) |
Income taxes from continuing operations | $ 4,445 | $ (968) |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Income Tax Disclosure [Abstract] | ||
Net operating loss and capital loss carryforward | $ 1,324 | $ 3,584 |
Right of use asset | 1,466 | |
Right of use asset | 1,348 | |
Other | 2,684 | 2,531 |
Capital lease obligations | 1,466 | (1,348) |
Depreciation | (705) | (948) |
Amortization | (2,703) | (2,989) |
Valuation allowance | (824) | (2,178) |
Total | $ (224) | $ 0 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Operating Loss Carryforwards [Line Items] | ||
Valuation allowance | $ (824) | $ (2,178) |
Annual limitation amount | 600 | |
State and Local Jurisdiction | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards, state and local | 800 | |
Domestic Tax Authority | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards, federal | $ 500 |
Schedule of Other Current Liabi
Schedule of Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Liabilities Disclosure [Abstract] | ||
Accrued diagnostic services commissions | $ 1,093 | $ 1,283 |
Accrued payroll | 202 | 514 |
Accrued expenses | 714 | 300 |
Accrued returns | 13 | 338 |
Accrued benefits and vacation | 50 | 60 |
Total other current liabilities | $ 2,072 | $ 2,495 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Thousands | 12 Months Ended | |||
Jul. 19, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | May 01, 2021 periods | |
Other Commitments [Line Items] | ||||
Number of successive periods | periods | 5 | |||
Agreement term, successive periods (in years) | 1 year | |||
Agreement term (in days) | 90 days | |||
Upfront license fee | $ 50 | |||
License agreement term (in days) | 10 days | |||
Licensor royalties | 3% | |||
Minimum royalty obligation | $ 250 | |||
General and administration | $ 34,385 | $ 22,493 | ||
Deferred Tax Assets, Valuation Allowance | 824 | $ 2,178 | ||
License Agreement | ||||
Other Commitments [Line Items] | ||||
General and administration | $ 500 | |||
License Agreement | Phase Three | ||||
Other Commitments [Line Items] | ||||
Additional payment of fee | 900 | |||
License Agreement | New Drug Application | ||||
Other Commitments [Line Items] | ||||
Additional payment of fee | $ 1,000 |
Summary of Quantitative Informa
Summary of Quantitative Information About Operating Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | ||
Operating lease cost | $ 816 | $ 816 |
Variable lease cost | 0 | 0 |
Operating lease expense | 816 | 816 |
Total rent expense | 816 | 816 |
Operating cash flows used in operating leases | $ (774) | $ (357) |
Weighted-average remaining lease term – operating leases (in years) | 8 years 6 months | 9 years 4 months 24 days |
Weighted-average discount rate – operating leases | 10% | 10% |
Schedule of Maturity of Operati
Schedule of Maturity of Operating Leases (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Leases [Abstract] | |
Year Ended December 31, 2023 | $ 739 |
Year Ended December 31, 2024 | 747 |
Year Ended December 31, 2025 | 768 |
Year Ended December 31, 2026 | 783 |
Year Ended December 31, 2027 | 804 |
Thereafter | 3,071 |
Total | 6,912 |
Less present value discount | (2,352) |
Operating lease liabilities | $ 4,560 |
Leases - Narrative (Details)
Leases - Narrative (Details) | 12 Months Ended | |||||
Jun. 10, 2022 USD ($) ft² | Dec. 08, 2020 USD ($) ft² | Oct. 23, 2020 USD ($) ft² | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Oct. 31, 2020 ft² | |
Lessee, Lease, Description [Line Items] | ||||||
Monthly base lease payment | $ 774,000 | $ 357,000 | ||||
Area of real estate property | ft² | 4,500 | |||||
Lease liability | 4,560,000 | |||||
Right-of-use asset | $ 4,059,000 | $ 4,402,000 | ||||
NY Lease | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Lease term (in months) | 7 months | |||||
Renewal term (in years) | 5 years | |||||
Lease term (in years) | 10 years 7 months | |||||
Monthly base lease payment | $ 56,963 | |||||
Gradual rental rate increase percentage | 2.75% | |||||
Area of real estate property | ft² | 4,516 | 4,600 | ||||
Base rent | $ 11,290 | |||||
Rent total | 14,026 | |||||
Construction allowance | $ 203,220 | |||||
NY Lease | Final Months | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Monthly base lease payment | $ 74,716 | |||||
NY Lease | Year 1 | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Renewal term (in years) | 12 months | |||||
CPM Acquisition | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Area of real estate property | ft² | 4,000 | |||||
CPM Acquisition | Old Bridge New Jersey | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Lease term (in months) | 24 months | |||||
Monthly base lease payment | $ 5,950 | |||||
Area of real estate property | ft² | 4,000 | |||||
NY Lease | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Gradual rental rate increase percentage | 2.75% |
Consulting Agreement and Secu_2
Consulting Agreement and Secured Promissory Note Receivable - Narrative (Details) - USD ($) | 2 Months Ended | 12 Months Ended | ||||||
Jan. 14, 2021 | Feb. 28, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Jun. 25, 2021 | Sep. 25, 2020 | Jul. 29, 2020 | Jul. 21, 2020 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Interest income | $ 0 | $ 642,000 | ||||||
Secured note | 0 | |||||||
Charge-off | (761,000) | 3,866,000 | ||||||
General and Administrative Expense | ||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Charge-off | 0 | 3,700,000 | ||||||
Investment Shares | ||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Investment shares (in shares) | 1,260,619 | |||||||
Investments owned | $ 0 | $ 76,000 | $ 315,000 | |||||
Termination Agreement | ||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Aggregate principal amount | $ 1,000,000 | |||||||
Acquisition related costs | 250,000 | |||||||
Test fees received | $ 95,000 | |||||||
Unrelated Third party | Minimum | ||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Aggregate principal amount | 2,750,000 | |||||||
Unrelated Third party | Maximum | ||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Aggregate principal amount | $ 3,750,000 | |||||||
Unrelated Third party | Secured Debt | ||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Aggregate principal amount | $ 1,000,000 | |||||||
Unrelated Third party | Revision of Prior Period, Adjustment | Secured Debt | ||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||||
Aggregate principal amount | $ 3,000,000 | $ 250,000 | $ 750,000 |
Significant Customers Concent_2
Significant Customers Concentrations - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Concentration Risk [Line Items] | ||
Revenues, net | $ 122,647 | $ 79,042 |
Share-based compensation expense | $ 4,500 | |
Stock options outstanding (in shares) | 3,952,000 | |
Future issuance (in shares) | 2,961,000 | |
Weighted average period (in years) | 3 years | |
Issuance of common stock upon stock options cashless exercise (in shares) | 1,833,000 | |
Common Stock | ||
Concentration Risk [Line Items] | ||
Shares issued (in shares) | 828,021 | |
Issuance of common stock upon stock options cashless exercise (in shares) | 828,021 | |
2018 Stock | ||
Concentration Risk [Line Items] | ||
Share-based compensation expense | $ 4,000 | $ 3,200 |
Diagnostic Services Clients One | Customer Concentration Risk | Revenue Benchmark | ||
Concentration Risk [Line Items] | ||
Percent of revenue | 65% | 23.50% |
Diagnostic Services Clients One | Customer Concentration Risk | Reimbursement Receivable | ||
Concentration Risk [Line Items] | ||
Percent of revenue | 68.80% | |
Diagnostic Services Clients One | Trade Receivable | Reimbursement Receivable | ||
Concentration Risk [Line Items] | ||
Percent of revenue | 43% | |
Diagnostic Services Clients Two | Customer Concentration Risk | Revenue Benchmark | ||
Concentration Risk [Line Items] | ||
Percent of revenue | 15% | 17.90% |
Diagnostic Services Clients Two | Customer Concentration Risk | Reimbursement Receivable | ||
Concentration Risk [Line Items] | ||
Percent of revenue | 16% | |
Diagnostic Services Clients Two | Trade Receivable | Reimbursement Receivable | ||
Concentration Risk [Line Items] | ||
Percent of revenue | 11.60% | |
Diagnostic Services Clients Three | Customer Concentration Risk | Revenue Benchmark | ||
Concentration Risk [Line Items] | ||
Percent of revenue | 11.90% | |
Diagnostic Services Clients Three | Trade Receivable | Reimbursement Receivable | ||
Concentration Risk [Line Items] | ||
Percent of revenue | 10.70% | |
Government Agencies | Customer Concentration Risk | Revenue Benchmark | ||
Concentration Risk [Line Items] | ||
Percent of revenue | 29% | 60% |
Insurance Providers | Customer Concentration Risk | Revenue Benchmark | ||
Concentration Risk [Line Items] | ||
Percent of revenue | 66% | 35% |
Client Payers | Customer Concentration Risk | Revenue Benchmark | ||
Concentration Risk [Line Items] | ||
Percent of revenue | 5% | 5% |
Diagnostic Services Clients Four | Trade Receivable | Reimbursement Receivable | ||
Concentration Risk [Line Items] | ||
Percent of revenue | 10.70% |
Segment Information (Details Na
Segment Information (Details Narrative) | 12 Months Ended |
Dec. 31, 2022 Segment | |
Segment Reporting [Abstract] | |
Number of Operating Segments | 2 |
Schedule of Segment Information
Schedule of Segment Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | ||
Revenues, net | $ 122,647 | $ 79,042 |
Cost of revenue | 51,993 | 37,054 |
Depreciation and amortization expense | 4,542 | 1,983 |
Operating and other expenses | 43,203 | 34,700 |
Income from operations before income taxes | 22,908 | 5,305 |
Income tax benefit (expense) | (4,445) | 968 |
Income from operations after income taxes | 18,463 | 6,273 |
TOTAL ASSETS | 87,648 | 89,295 |
Diagnostic services | ||
Segment Reporting Information [Line Items] | ||
Revenues, net | 108,329 | 68,559 |
Cost of revenue | 39,896 | 29,415 |
Depreciation and amortization expense | 2,336 | 1,976 |
Income (loss) from operations, before income taxes | 56,389 | 18,197 |
TOTAL ASSETS | 50,832 | 51,150 |
Consumer products | ||
Segment Reporting Information [Line Items] | ||
Revenues, net | 14,318 | 10,483 |
Cost of revenue | 12,097 | 7,639 |
Depreciation and amortization expense | 2,206 | 7 |
Income (loss) from operations, before income taxes | (10,824) | (1,714) |
TOTAL ASSETS | 22,080 | 24,139 |
Unallocated corporate | ||
Segment Reporting Information [Line Items] | ||
Income (loss) from operations, before income taxes | (22,657) | (11,178) |
TOTAL ASSETS | $ 14,736 | $ 14,006 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Basic and Diluted Net Loss Per Share (Details) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Earnings Per Share [Abstract] | ||
Net income - basic | $ 18,464 | $ 6,273 |
Interest on unsecured convertible promissory note | 632 | 1,000 |
Net income - diluted | $ 19,096 | $ 7,273 |
Weighted average shares outstanding - basic | 15,845 | 15,172 |
Diluted shares- Stock Options | 1,493 | 2,001 |
Diluted shares- Stock Warrants | 1,073 | 220 |
Unsecured convertible promissory note | 240 | 1,000 |
Weighted average shares outstanding - diluted | 18,651 | 18,393 |
Earnings Per Share - Schedule_2
Earnings Per Share - Schedule of Anti-dilutive Securities Excluded from the Income Per Share Computation (Details) - shares shares in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share, amount | 1,225 | 1,283 |
Common stock purchase warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share, amount | 455 | 455 |
Stock Options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share, amount | 770 | 828 |
Unsecured convertible promissory note | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share, amount | 0 | 0 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) | 1 Months Ended | 12 Months Ended | ||||||
Mar. 15, 2023 USD ($) | Mar. 13, 2023 USD ($) numberOfEmployee $ / shares shares | Dec. 15, 2022 USD ($) $ / shares shares | Sep. 08, 2021 | Jan. 31, 2023 USD ($) shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Jan. 26, 2023 USD ($) | |
Subsequent Event [Line Items] | ||||||||
Common stock, par or stated value (in dollars per share) | $ / shares | $ 0.0005 | $ 0.0005 | $ 0.0005 | |||||
Issuance of common stock upon stock options cashless exercise (in shares) | 1,833,000 | |||||||
Stock repurchased | $ | $ 2,152,000 | $ 917,000 | ||||||
Stock repurchase program, term (in months) | 6 months | |||||||
Common Stock | ||||||||
Subsequent Event [Line Items] | ||||||||
Issuance of common stock upon stock options cashless exercise (in shares) | 828,021 | |||||||
Stock repurchased (in shares) | 303,145 | 166,824 | ||||||
Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Issuance of common stock upon stock options cashless exercise (in shares) | 1,348,250 | |||||||
Stock repurchased | $ | $ 5,378 | |||||||
Stock repurchase program, term (in months) | 6 months | |||||||
Authorized amount | $ | $ 6,000,000 | |||||||
Subsequent Event | Common Stock | ||||||||
Subsequent Event [Line Items] | ||||||||
Issuance of common stock upon stock options cashless exercise (in shares) | 603,881 | |||||||
Stock repurchased (in shares) | 744,369 | |||||||
Subsequent Event | Stock Options | 2022 Plan | ||||||||
Subsequent Event [Line Items] | ||||||||
Shares purchased (in shares) | 205,000 | |||||||
Number of employees | numberOfEmployee | 7 | |||||||
Exercise price (in dollars per share) | $ / shares | $ 6.84 | |||||||
Vesting period (in years) | 3 years | |||||||
Fair value, granted | $ | $ 900,000 | |||||||
Subsequent Event | Vesting Period One | Stock Options | 2022 Plan | ||||||||
Subsequent Event [Line Items] | ||||||||
Award vesting rights, percentage | 25% | |||||||
Subsequent Event | Vesting Period Two | Stock Options | 2022 Plan | ||||||||
Subsequent Event [Line Items] | ||||||||
Award vesting rights, percentage | 75% | |||||||
Subsequent Event | Note | ||||||||
Subsequent Event [Line Items] | ||||||||
Aggregate principal amount | $ | $ 7,600,000 | |||||||
Interest rate | 10% | |||||||
Stella Purchase Agreement | ||||||||
Subsequent Event [Line Items] | ||||||||
Cash paid | $ | $ 3,500,000 | |||||||
Stock issued (in shares) | 100,000 | |||||||
Payments for acquisition, term (in years) | 7 years | |||||||
Royalty percent | 5% |
Uncategorized Items - prph-2022
Label | Element | Value |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | ||
Revenue, Remaining Performance Obligation, Amount | us-gaap_RevenueRemainingPerformanceObligation | $ 375,000 |
Revenue, Remaining Performance Obligation, Amount | us-gaap_RevenueRemainingPerformanceObligation | 376,000 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | ||
Revenue, Remaining Performance Obligation, Amount | us-gaap_RevenueRemainingPerformanceObligation | 2,034,000 |
Revenue, Remaining Performance Obligation, Amount | us-gaap_RevenueRemainingPerformanceObligation | 2,499,000 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | ||
Revenue, Remaining Performance Obligation, Amount | us-gaap_RevenueRemainingPerformanceObligation | 530,000 |
Revenue, Remaining Performance Obligation, Amount | us-gaap_RevenueRemainingPerformanceObligation | $ 683,000 |