Cover
Cover - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Mar. 25, 2022 | Jun. 30, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2021 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2021 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity File Number | 000-21617 | ||
Entity Registrant Name | ProPhase Labs, Inc. | ||
Entity Central Index Key | 0000868278 | ||
Entity Tax Identification Number | 23-2577138 | ||
Entity Incorporation, State or Country Code | DE | ||
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 | ||
Entity Shell Company | false | ||
Entity Public Float | $ 73,462,896 | ||
Entity Common Stock, Shares Outstanding | 15,485,900 | ||
Documents Incorporated by Reference [Text Block] | Portions of the Registrant’s definitive proxy statement relating to its 2022 annual meeting of stockholders (the “2022 Proxy Statement”) are incorporated by reference into Part III of this Annual Report on Form 10-K where indicated. The 2022 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 | ||
ICFR Auditor Attestation Flag | false | ||
Auditor Firm ID | 711 | ||
Auditor Name | Friedman LLP | ||
Auditor Location | East Hanover, New Jersey |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash and cash equivalents | $ 8,408 | $ 6,816 |
Restricted cash | 250 | |
Marketable debt securities, available for sale | 8,779 | 1,639 |
Marketable equity securities, at fair value | 76 | |
Accounts receivable, net | 37,708 | 3,155 |
Inventory, net | 4,600 | 3,039 |
Prepaid expenses and other current assets | 1,496 | 1,238 |
Total current assets | 61,317 | 15,887 |
Property, plant and equipment, net | 5,947 | 3,578 |
Secured promissory note receivable | 2,750 | |
Prepaid expenses, net of current portion | 460 | 2,084 |
Right-of-use asset, net | 4,402 | 4,731 |
Intangible assets, net | 10,852 | 1,234 |
Goodwill | 5,709 | 901 |
Other assets | 608 | 240 |
TOTAL ASSETS | 89,295 | 31,405 |
Current liabilities | ||
Accounts payable | 7,026 | 3,771 |
Accrued diagnostic services | 1,890 | |
Accrued advertising and other allowances | 104 | 463 |
Lease liabilities | 663 | 329 |
Deferred revenue | 2,034 | 169 |
Other current liabilities | 3,807 | 1,562 |
Total current liabilities | 15,524 | 6,294 |
Non-current liabilities: | ||
Deferred revenue, net of current portion | 905 | 162 |
Note payable | 44 | |
Unsecured convertible promissory notes, net | 9,996 | 9,991 |
Lease liabilities, net of current portion | 4,198 | 4,402 |
Total non-current liabilities | 15,143 | 14,555 |
Total liabilities | 30,667 | 20,849 |
COMMITMENTS AND CONTINGENCIES | ||
Stockholders’ equity | ||
Preferred stock authorized 1,000,000, $0.0005 par value, no shares issued and outstanding | ||
Common stock authorized 50,000,000, $0.0005 par value, 15,485,900 and 11,604,253 shares outstanding, respectively | 16 | 14 |
Additional paid-in capital | 104,552 | 61,674 |
Retained earnings (accumulated deficit) | 2,642 | (3,631) |
Treasury stock, at cost, 16,818,846 and 16,652,022 shares, respectively | (48,407) | (47,490) |
Accumulated other comprehensive loss | (175) | (11) |
Total stockholders’ equity | 58,628 | 10,556 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 89,295 | $ 31,405 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 |
Preferred Stock, Par or Stated Value Per Share | $ 0.0005 | $ 0.0005 |
Preferred Stock, Shares Issued | 0 | 0 |
Common Stock, Shares Authorized | 50,000,000 | 50,000,000 |
Common Stock, Par or Stated Value Per Share | $ 0.0005 | $ 0.0005 |
Common Stock, Shares, Outstanding | 15,485,900 | 11,604,253 |
Treasury Stock, Shares | 16,818,846 | 16,652,022 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Other Comprehensive Income (Loss) - USD ($) shares in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income Statement [Abstract] | ||
Revenues, net | $ 79,042,000 | $ 14,514,000 |
Cost of revenues | 37,054,000 | 9,908,000 |
Gross profit | 41,988,000 | 4,606,000 |
Operating expenses: | ||
Diagnostic expenses | 9,174,000 | 448,000 |
General and administration | 22,493,000 | 7,498,000 |
Research and development | 520,000 | 633,000 |
Total operating expenses | 32,187,000 | 8,579,000 |
Gain on sale of real estate | 1,892,000 | |
Income (loss) from operations | 9,801,000 | (2,081,000) |
Interest income, net | 642,000 | 62,000 |
Interest expense | (1,148,000) | (295,000) |
Change in fair value of investment securities | (240,000) | |
Impairment of secured promissory note receivable | (3,750,000) | |
Income (loss) from continuing operations before income taxes | 5,305,000 | (2,314,000) |
Income tax benefit (expense) | 968,000 | (12,000) |
Income (loss) from continuing operations after income taxes | 6,273,000 | (2,326,000) |
Discontinued Operations: | ||
Income from discontinued operations | 201,000 | |
Net income (loss) | 6,273,000 | (2,125,000) |
Other comprehensive loss: | ||
Unrealized loss on marketable debt securities | (164,000) | (9,000) |
Total comprehensive income (loss) | $ 6,109,000 | $ (2,134,000) |
Basic and earnings (loss) per share: | ||
Income (loss) from continuing operations | $ 0.41 | $ (0.20) |
Income from discontinued operations | 0.02 | |
Net income (loss) per share | 0.41 | (0.18) |
Diluted earnings (loss) per share: | ||
Income (loss) from continuing operations | 0.40 | (0.20) |
Income from discontinued operations | 0.02 | |
Net income (loss) per share | $ 0.40 | $ (0.18) |
Weighted average common shares outstanding: | ||
Basic | 15,172 | 11,595 |
Diluted | 18,393 | 11,595 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Treasury Stock [Member] | Total |
Beginning balance, value at Dec. 31, 2019 | $ 14 | $ 60,215 | $ (1,506) | $ (2) | $ (47,490) | $ 11,231 |
Balance, shares at Dec. 31, 2019 | 11,573,593 | |||||
Unrealized loss on marketable debt securities, net of taxes | (9) | (9) | ||||
Stock-based compensation | 1,459 | 1,459 | ||||
Stock based compensation, shares | 30,660 | |||||
Net income | (2,125) | (2,125) | ||||
Ending balance, value at Dec. 31, 2020 | $ 14 | 61,674 | (3,631) | (11) | (47,490) | 10,556 |
Balance, shares at Dec. 31, 2020 | 11,604,253 | |||||
Unrealized loss on marketable debt securities, net of taxes | (164) | (164) | ||||
Stock-based compensation | 3,183 | 3,183 | ||||
Stock based compensation, shares | 8,800 | |||||
Net income | 6,273 | 6,273 | ||||
Issuance of common stock and warrants for cash from public offering, net of $2,365 offering cost | $ 2 | 35,133 | 35,135 | |||
Issuance of common stock and warrants for cash from public offering, shares | 3,000,000 | |||||
Issuance of common stock and warrants for cash from private offering | 5,500 | 5,500 | ||||
Issuance of common stock and warrants for cash from private offering, shares | 550,000 | |||||
Issuance of common shares related to business acqusition | 3,608 | 3,608 | ||||
Issuance of common shares related to business acqusition, shares | 483,685 | |||||
Cash dividends | (4,546) | (4,546) | ||||
Repurchases of common shares | (917) | (917) | ||||
Repurchases of common share, shares | (166,824) | |||||
Cashless warrants exercise | ||||||
Cashless warrants exercise shares | 5,986 | |||||
Ending balance, value at Dec. 31, 2021 | $ 16 | $ 104,552 | $ 2,642 | $ (175) | $ (48,407) | $ 58,628 |
Balance, shares at Dec. 31, 2021 | 15,485,900 |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Subsidiary, Sale of Stock [Line Items] | ||
Marketable Securities, Gain (Loss) | $ 4 | |
IPO [Member] | ||
Subsidiary, Sale of Stock [Line Items] | ||
[custom:OfferingCost] | $ 2,365 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities | ||
Net income (loss) | $ 6,273,000 | $ (2,125,000) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Realized (gain) loss on marketable debt securities | 165,000 | (2,000) |
Gain on discontinued operations, net of taxes | (201,000) | |
Depreciation and amortization | 3,234,000 | 449,000 |
Amortization of debt discount | 5,000 | 1,000 |
Amortization on right-of-use assets | 329,000 | 9,000 |
Lower of cost or net realizable value inventory adjustment | 68,000 | |
Consulting expense paid through reduction of secured promissory note receivable | 250,000 | |
Impairment of secured promissory note receivable | 3,750,000 | |
Stock-based compensation expense | 3,183,000 | 1,459,000 |
Change in fair value of investment securities | 240,000 | |
Non-cash interest income on secured promissory note receivable | (316,000) | |
Gain on sale of real estate | (1,892,000) | |
Accounts receivable allowances | 3,866,000 | 97,000 |
Inventory valuation reserve | 267,000 | (193,000) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (38,197,000) | (1,136,000) |
Inventory | (1,746,000) | (1,275,000) |
Prepaid and other assets | 1,445,000 | (3,005,000) |
Other assets | (368,000) | (240,000) |
Accounts payable and accrued expenses | 2,450,000 | 3,339,000 |
Accrued diagnostic services | 1,890,000 | |
Deferred revenue | 2,608,000 | |
Lease liabilities | 130,000 | (9,000) |
Other liabilities | (2,827,000) | 1,814,000 |
Net cash used in operating activities | (13,619,000) | (2,592,000) |
Cash flows from investing activities | ||
Business acquisitions, net of cash acquired | (9,066,000) | |
Issuance of secured promissory note receivable | (1,000,000) | (3,000,000) |
Purchase of marketable securities | (21,527,000) | (4,560,000) |
Proceeds from sale of marketable debt securities | 15,858,000 | 3,840,000 |
Proceeds from promissory note | 300,000 | |
Escrow receivable | 4,812,000 | |
Acquisition of Confucius Labs | (2,500,000) | |
Proceeds from sale of building, net | 2,081,000 | |
Capital expenditures | (4,231,000) | (1,689,000) |
Net cash used in investing activities | (19,666,000) | (1,016,000) |
Cash flows from financing activities | ||
Proceeds from issuance of common stock from public offering, net | 35,135,000 | |
Proceeds from issuance of common stock and warrants from private offering | 5,500,000 | |
Proceeds from unsecured convertible promissory notes | 10,000,000 | |
Issuance costs on unsecured convertible promissory notes | (10,000) | |
Repayment of note payable | (45,000) | |
Repurchases of common shares | (917,000) | |
Payment of dividends | (4,546,000) | |
Net cash provided by financing activities | 35,127,000 | 9,990,000 |
Increase in cash, cash equivalents and restricted cash | 1,842,000 | 6,382,000 |
Cash, cash equivalents and restricted cash, at the beginning of the year | 6,816,000 | 434,000 |
Cash, cash equivalents and restricted cash, at the end of the year | 8,658,000 | 6,816,000 |
Supplemental disclosures: | ||
Cash paid for income taxes | ||
Interest payment on the promissory notes | 1,000,000 | 250,000 |
Supplemental disclosure of non-cash investing and financing activities: | ||
Issuance of common shares related to business acqusition | 3,608,000 | |
Right-of-use assets and lease liability recorded upon adoption of ASC 842 | 4,740,000 | |
Net unrealized loss, investments in marketable debt securities | (164,000) | (9,000) |
Recognize additional goodwill related to deferred tax liability | $ 362,000 |
Organization and Business
Organization and Business | 12 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Business | Note 1 – Organization and Business ProPhase Labs, Inc. (“ProPhase”, “we”, “us”, “our” or the “Company”) is a diversified company that offers a range of services including diagnostic testing, genomics testing and contract manufacturing. We provide traditional CLIA molecular laboratory services, including SARS-CoV-2 (“COVID-19”) testing and seek to leverage our Clinical Laboratory Improvement Amendments (“CLIA”) accredited laboratory services to provide whole genome sequencing and research direct to consumers, while building a genomics data base to be used for further research. In addition, we have deep experience with over-the- counter (“OTC”) consumer healthcare products and dietary supplements. We currently conduct our operations through two operating segments: diagnostic services and consumer products. Until late Fiscal 2020, we were engaged primarily in the research, development, manufacture, distribution, marketing and sale of OTC consumer healthcare products and dietary supplements in the United States. However, commencing in December 2020, we also began offering COVID-19 and other Respiratory Pathogen Panel (RPP) molecular tests through our new diagnostic services business, and in August 2021 we began offering personal genomics products and services. Our wholly owned subsidiary, ProPhase Diagnostics, Inc. (“ProPhase Diagnostics”), which was formed on October 9, 2020, offers a broad array of clinical diagnostic and testing services at its CLIA certified laboratories including state-of-the-art polymerase chain reaction (“PCR”) testing for COVID-19. Critical to COVID-19 testing, we provide fast turnaround times for results. We also offer rapid antigen and antibody/immunity testing for COVID-19. On October 23, 2020, we acquired Confucius Plaza Medical Laboratory Corp. (“CPM”), which included a non-operating but certified 4,000 square foot CLIA accredited laboratory located in Old Bridge, New Jersey (see Note 3, Business Acquisitions). 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. On August 10, 2021, we acquired Nebula Genomics, Inc. (“Nebula”), a privately owned personal genomics company (“Nebula”), through our new wholly owned subsidiary, ProPhase Precision Medicine, Inc. (“ProPhase Precision”). See Note 3, Business Acquisitions. ProPhase Precision focuses on genomics testing technologies, a comprehensive method for analyzing entire genomes, including the genes and chromosomes in DNA. The data obtained from genomic testing can help to identify inherited disorders and tendencies, help predict disease risk, help identify expected drug response, and characterize genetic mutations, including those that drive cancer progression. Our 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. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2 – 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 FASB 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 and personal genomics products and services). See Note 15 Segment Information. Business and Liquidity Risks and Uncertainties We launched our diagnostic service business in December 2020 and expanded in January 2021 with the opening of our new Garden City, New York CLIA accredited laboratory. Our diagnostic service business is and will continue to be influenced by the level of demand for COVID-19 and other diagnostic testing, how long this demand persists and the prices we are able to receive for performing 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. There are still numerous uncertainties associated with the COVID-19 pandemic, including the efficacy of the vaccines that have been developed to treat the virus and their ability to protect against new strains of the virus, people’s willingness to receive a vaccine, possible resurgences of the coronavirus and/or new strains of the virus, the extent and duration of protective and preventative measures that may be adopted by local, state and/or the federal government in the future as a result of future outbreaks, the duration of any future business closures, the ongoing impact of COVID-19 on the U.S. and world economy and consumer confidence, and various other uncertainties all of which could negatively impact our Company as a whole. While our revenues increased significantly for the year ended December 31, 2021 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 payors. 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. Approximately 59.5 Further, our diagnostic service business is subject to extensive federal, state, and local laws and regulations, all of which are subject to change, as well as laws and regulations governing the submission of claims for payment for our services, such as those relating to: coverage of our services under Medicare, Medicaid and other federal health care programs; the amounts that we may bill for our services; and the party to which we must submit claims. In addition, reimbursement policies and requirements for some payers and procedures are ambiguous, which could lead to billing errors and related disputes. There can be no assurance that our efforts to offer and perform COVID-19 or other diagnostic testing will be successful in the future or that the revenue and operating profits from such business will increase or maintain their current level. We acquired and commenced our personal genomics business in August 2021. This business is and will continue to be influenced by demand for our genetic testing products and services, our marketing and service capabilities, and our ability to comply with applicable regulatory requirements. The Company used cash in operating activities of $ 13.6 17.4 However, due to the nature of the diagnostic business and its focus thus far on COVID-19, there are inherent uncertainties associated with managements’ business plan and cash flow projections if we are unable to grow our diagnostic testing business beyond our COVID-19 testing services. 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 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, 2021 includes approximately $ 250,000 held in escrow related to a potential purchase of an additional lab facility. The potential purchase was not consummated, and we are pursuing the return of the escrow. 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 0.65% to 4.88% during fiscal 2021. 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): Summary of Components of Marketable Securities As of December 31, 2021 Amortized Unrealized Unrealized Fair Cost Gains Losses Value U.S. government obligations $ 650 $ 17 $ - $ 667 Corporate obligations 8,304 - (192 ) 8,112 $ 8,954 $ 17 $ (192 ) $ 8,779 As of December 31, 2020 Amortized Unrealized Unrealized Fair Cost Gains Losses Value U.S. government obligations $ 1,021 $ - $ (7 ) $ 1,014 Corporate obligations 629 - (4 ) 625 $ 1,650 $ $ (11 ) $ 1,639 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 . The fair value of the Investment Shares as of December 31, 2021, was based upon the closing stock price of $ 0.06 per share. The investment was classified as a Level 1 financial instrument. We recorded a $ 240,000 decrease in fair value of investment securities within the statement of operations for the year ended December 31, 2021. 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): Schedule of Accounts Receivable Net December 31, 2021 December 31, 2020 Trade accounts receivable $ 18,520 $ 1,975 Unbilled accounts receivable 23,089 1,215 Accounts receivable, gross 41,609 3,190 Less allowances (3,901 ) (35 ) Total accounts receivable $ 37,708 $ 3,155 For Fiscal 2021, we recorded $ 3.9 35,000 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, 2021 and 2020, the components of inventory are as follows (in thousands): Schedule of Components of Inventory December 31, December 31, 2021 2020 Diagnostic services testing material $ 2,989 $ 1,028 Raw materials 1,514 1,550 Work in process 260 440 Finished goods 272 188 Inventory $ 5,035 $ 3,206 Inventory valuation reserve $ (435 ) $ (167 ) Inventory, net $ 4,600 $ 3,039 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 to thirty-nine years; machinery and equipment including lab equipment - three to seven years; computer equipment and software - three to five years; and furniture and fixtures - five years. 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, 2021, our cash and cash equivalents and restricted cash balance was $ 8.7 million. Of the total bank balance, $ 1.0 million was covered by federal depository insurance and $ 7.7 million was uninsured at December 31, 2021. 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 14, Consulting Agreement and Secured Promissory Note Receivable and Consulting Agreement), balances due to us. As of December 31, 2021 and the financial statements reporting date, the Company did not expect full realization upon maturity. In addition, see Note 14 - Significant Customers. 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 e.g 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. 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, 2021 and 2020, 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): Schedule of Fair Value of Financial Instruments As of December 31, 2021 Level 1 Level 2 Level 3 Total Marketable debt securities U.S. government obligations $ - $ 667 $ - $ 667 Corporate obligations - 8,112 - 8,112 Marketable equity securities 76 - - 76 $ 76 $ 8,779 $ - $ 8,855 As of December 31, 2020 Level 1 Level 2 Level 3 Total Marketable debt securities U.S. government obligations $ - $ 1,014 $ - $ 1,014 Corporate obligations - 625 - 625 $ - $ 1,639 $ - $ 1,639 There were no transfers of marketable debt securities between Levels 1, 2 or 3 for the Fiscal 2021 and 2020. 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. Before fiscal 2021, we had historically generated sales principally through two types of customers, contract manufacturing and retail customers for our consumer products. Sales from product shipments to contract manufacturing and retailer customers are recognized at the time ownership is transferred to the customer. As of December 2020, we also began generating revenues through diagnostic services and in August 2021 we acquired a personal genomics business. 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 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. Recognize Revenue When the Company Satisfies a Performance Obligation 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. 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 $ 0.4 million for the year ended December 31, 2021. Contract Balances As of December 31, 2021 and December 31, 2020, we have deferred revenue of $ 2.9 million and $ 0.3 million , respectively. Our new personal genomics business comprised $ 2.7 million of the deferred revenue as of December 31, 2021. 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): Schedule of Deferred Revenue As of December 31, 2021 As of December 31, 2020 Recognition Period 0-12 Months $ 2,034 $ 169 13-24 Months 530 84 Over 24 Months 375 78 Total $ 2,939 $ 331 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 2021 and 2020 (in thousands): Schedule of Disaggregation by Revenue For the years ended Revenue by Customer Type December 31, 2021 December 31, 2020 Diagnostic services $ 68,559 $ 1,277 Contract manufacturing 5,786 12,252 Retail and others 2,454 985 Genomic products and services 2,243 - Total revenue, net $ 79,042 $ 14,514 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 promotion costs are ex |
Business Acquisitions
Business Acquisitions | 12 Months Ended |
Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Acquisitions | Note 3 – 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, each of the stockholders of Nebula (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 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, 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”) is being 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 entered into with the Escrow Agent, as security for the indemnification obligations of the Seller Parties. At the Escrow Termination Date, the remaining amount, if any, of the Escrow Amount, less any amount reasonably necessary to pay any claim with respect to which a notice of claim has been timely and properly given, will be delivered to the Seller Parties, as applicable. In connection with the Nebula Acquisition, ProPhase Precision entered into an employment agreement with Kamal Obbad, the Chief Executive Officer of Nebula, 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 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): Schedule of Assets Acquired and Liabilities Assumed 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. 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): Schedule of Intangible Assets Acquisition Estimated Useful Gross Carrying Value Life (in years) Trade names $ 5,550 15 Proprietary intellectual property 4,260 5 Customer relationships 1,180 1 Total $ 10,990 - The Company recognized $ 936,000 amortization expense on the above identified intangible assets during the year ended December 31, 2021. 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, 2020. 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): Schedule of Pro-forma Results December 31, 2021 December 31, 2020 For the years ended December 31, 2021 December 31, 2020 Revenue, net $ 81,164 $ 15,560 Net loss $ 6,135 $ (3,682 ) CPM Acquisition On October 23, 2020, the Company acquired all of the issued and outstanding shares of capital stock of CPM for approximately $ 2.5 million in cash, subject to certain adjustments, pursuant to the terms of a Stock Purchase Agreement, by and among the Company, CPM, Pride Diagnostics LLC (“Pride Diagnostics”) and the members of Pride Diagnostics (together with Pride Diagnostics, the “Seller Parties”), and Arvind Gurnani, as representative of the Seller Parties. As part of the acquisition, we acquired a 4,000 square foot (CLIA) accredited laboratory located in Old Bridge, New Jersey owned by CPM (now known as ProPhase Diagnostics NJ, Inc.). Based on valuation, the total consideration of $ 2.5 million has been allocated to assets acquired and liabilities assumed based on their respective fair values as follows (in thousands): Schedule of Assets Acquired and Liabilities Assumed Account Amount Clinical lab material $ 180 Lab equipment 112 Definite-lived intangible asset 1,307 Total assets acquired 1,599 Deferred tax liability (362 ) Total liabilities assumed (362 ) Net identifiable assets acquired 1,237 Goodwill 1,263 Total consideration $ 2,500 The Company recorded a measurement period adjustment during Fiscal 2021 to increase deferred tax liability and increase goodwill. Goodwill has been measured as the excess of the total consideration over the amounts assigned to the identifiable assets acquired and liabilities assumed in the amount of $ 901,000 , which was primarily related to the acquisition of the assembled workforce. Other definite-lived intangible asset of approximate $ 1.3 million were related to the CLIA license, which was determined to have an estimated useful life of three years. The Company recognized $ 436,000 and $ 73,000 aggregate amortization expense during the years ended December 31, 2021 and 2020, respectively. We have not presented unaudited pro forma combined results of operations as if CPM was acquired as of the beginning of fiscal year 2019 because CPM had no revenue and minimal expenses and, as such, would have been immaterial to our reported losses. |
Goodwill and Acquired Intangibl
Goodwill and Acquired Intangible Assets | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Acquired Intangible Assets | Note 4 – Goodwill and Acquired Intangible Assets Goodwill Changes in goodwill for Fiscal 2021 are as follows (in thousands): Schedule of Changes In Goodwill Amount Goodwill, beginning of Fiscal 2020 $ - Acquisition of CPM 901 Goodwill, beginning of Fiscal 2021 901 Adjustment for deferred tax liability 362 Acquisition of Nebula 4,446 Goodwill, end of Fiscal 2021 $ 5,709 Intangible Assets, Net Intangible assets as of December 31, 2021 and 2020 consisted of the following (in thousands): Schedule of Intangible Assets December 31, December 31, Estimated Useful 2021 2020 Life (in years) Trade names $ 5,550 $ - 15 Proprietary intellectual property 4,260 - 5 Customer relationships 1,180 - 1 CLIA license 1,307 1,307 3 Total intangible assets, gross 12,297 1,307 Less: accumulated amortization (1,445 ) (73 ) Total intangible assets, net $ 10,852 $ 1,234 Amortization expense for acquired intangible assets was $ 1,372,000 and $ 73,000 during the years ended December 31, 2021 and 2020, respectively. The estimated future amortization expense of acquired intangible assets as of December 31, 2021 is as follows (in thousands): Schedule Estimated Future Amortization Expense of Acquired Intangible Assets Year ended December 31, 2022 $ 2,378 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 Thereafter 3,555 Total $ 10,852 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Note 5 – Property, Plant and Equipment The components of property, plant and equipment are as follows (in thousands): Schedule of Property, Plant and Equipment December 31, December 31, 2021 2020 Estimated Useful Life Land $ 352 $ 352 Building improvements 1,729 1,729 10 - 39 years Machinery 4,740 4,441 3 - 7 years Lab equipment 4,330 1,002 3 - 7 years Computer equipment and software 1,211 881 3 - 5 years Furniture and fixtures 468 194 5 years Property, Plant and Equipment, Gross 12,830 8,599 Less: accumulated depreciation (6,883 ) (5,021 ) Total property, plant and equipment, net $ 5,947 $ 3,578 Depreciation expense for Fiscal 2021 and 2020 were $ 1,862,000 and $ 375,000 , respectively. On July 10, 2020, we entered into an Agreement of Sale and Purchase (the “Sale Agreement”) with Lenape Valley Foundation (the “Purchaser”), pursuant to which we agreed to sell our then corporate headquarters land and building located in Doylestown, Pennsylvania to the Purchaser for $ 2.2 million. On November 13, 2020, we closed on the sale of our former corporate headquarters and relocated our headquarters to Garden City, New York in January 2021. The total sales price of the property, which was paid in cash, was $ 2.2 million, less closing costs and related expenses of approximately $ 134,000 . As a result of the sale, we recorded $ 1.9 million gain from the sale of the real estate for Fiscal 2020. |
Unsecured Convertible Promissor
Unsecured Convertible Promissory Notes Payable | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Unsecured Convertible Promissory Notes Payable | Note 6 - 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”). The September 2020 Notes are due and payable on September 15, 2023 and accrue interest at a rate of 10 % per year from the closing date, payable on a quarterly basis, until the September 2020 Notes are repaid in full. We have the right to prepay the September 2020 Notes at any time after the 13-month anniversary of the closing date after providing written notice to the Lenders and may prepay the September 2020 Notes prior to such time with the consent of the Lenders. The Lenders have the right, at any time, and from time to time, on and after the 13-month anniversary of the closing date to convert up to an aggregate of $ 3.0 million of the September 2020 Notes into common stock of the Company at a conversion price of $ 3.00 per share. Repayment of the September 2020 Notes has been guaranteed by our wholly owned subsidiary, PMI. The September 2020 Notes contain 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 Notes may be accelerated. The September 2020 Notes also contain certain restrictive covenants which, among other things, restrict our ability to create, incur, assume or permit to exist, directly or indirectly, any lien (other than certain permitted liens described in the September 2020 Notes) securing any indebtedness of the Company, and prohibits us from distributing or reinvesting the proceeds from any divestment of assets (other than in the ordinary course) without the prior approval of the Lenders. For the year ended December 31, 2021 and 2020, we incurred $ 1,000,000 and $ 295,000 , respectively, in interest expense under the September 2020 Notes. |
Stockholders_ Equity
Stockholders’ Equity | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
Stockholders’ Equity | Note 7 – 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 our certificate of incorporation may be issued from time to time in one or more series. As of December 31, 2021, no shares of preferred stock have been issued. Our 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 we have authority to issue under our 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. We may, subject to any required stockholder approval amend from time to time our 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 13, 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. In Fiscal 2020, no cash dividends were declared. Common Stock Registered Direct Offering On January 5, 2021, we entered into a securities purchase agreement with certain accredited investors and qualified institutional buyers, pursuant to which we issued and sold to the purchasers an aggregate of (i) 550,000 shares of our common stock, and (ii) warrants to purchase up to 275,000 shares of 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 us 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, we 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, we 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, we 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, we entered into a Sales Agreement (the “Sales Agreement”) with ThinkEquity LLC (the “Sales Agent”), pursuant to which we may offer and sell, from time to time through the Sales Agent, shares (the “Shares”) of our common stock, par value $ 0.0005 per share (the “Common Stock”), having an aggregate offering price of up to $ 100,000,000 , subject to the terms and conditions of the Sales Agreement. We are not obligated to make any sales of the 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 Shares subject to the Sales Agreement and (ii) termination of the Sales Agreement as permitted therein. We 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 us. We will pay the Sales Agent a fixed commission rate of 2.0 % of the aggregate gross proceeds from the sale of the Shares pursuant to the Sales Agreement and has agreed to provide the Sales Agent with customary indemnification and contribution rights. We 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, we 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 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 period from December 28, 2021, through December 31, 2021, we 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, 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 September 8, 2021, the Company announced that its board of directors (the “Board”) 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 will re-evaluate the program from time to time and may authorize adjustments to its terms. We repurchased 166,824 shares during Fiscal 2021 pursuant to the stock repurchase program for an aggregate amount of $ 944,000 , 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 our common stock were granted to our directors in lieu of director fees under the Amended 2010 Directors’ Plan with a strike price of $ 5.28 per share. During the year ended December 31, 2020, common stock and stock options to purchase an aggregate of 200,000 shares of common stock were granted to our directors under the Amended 2010 Directors’ Plan in lieu of director fees. At December 31, 2021, there were 425,126 stock options outstanding and there were no shares of common stock available to be issued under the Amended 2010 Directors’ Plan. 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. During Fiscal 2020, the Company granted 513,000 stock options at an exercise price of $ 2.64 - $ 8.82 , 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. In addition, 510,000 options were granted during Fiscal 2020 in excess of the total amount allocated to the 2010 Plan. These options were excluded from the stock compensation expense calculation as the options required stockholder approval before we could recognize the compensation expense. As of December 31, 2021, there were 2,034,874 stock options outstanding and 275,785 stock options available to be issued under the 2010 Plan. We will recognize an aggregate of approximately $ 1,895,820 of remaining share-based compensation expense related to outstanding stock options over a weighted average period of 5.9 years. The 2018 Stock Incentive Plan On April 12, 2018, our 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 have been granted in the form of stock options to Ted Karkus (the “CEO Option”), our Chief Executive Officer and, to date, no stock options have been exercised under the 2018 Stock Plan. No share based compensation expense will be recognized in forward periods related to the 2018 Stock Plan. 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 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. Inducement Option Award As part of Nebula Acquisition, the Company issued a non-qualified stock option to Kamal Obbad, the Chief Executive Officer of Nebula, as an inducement to his employment with the Company (the “Inducement Award”). The Inducement 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 Inducement Award was granted to Mr. Obbad on the closing date of the Nebula Acquisition. The Inducement 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 Inducement Award expires on the seventh anniversary of the grant date. Any portion of the Inducement Award that does not vest and become exercisable will be forfeited for no consideration. The grant date fair value of the Inducement Award was approximately $ 1,128,000 . During the year ended December 31, 2021, we issued an inducement award to a non-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. The following table summarizes stock options activity during Fiscal 2021 and 2020 for the Amended 2010 Plan, the Amended 2010 Directors’ Plan, the 2018 Stock Plan and the Inducement Award (in thousands, except per share data). Schedule of Stock Options Activity Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life Total Intrinsic Value Outstanding as of January 1, 2020 3,082 1.67 3.7 $ 1,085 Granted 713 4.58 7.0 - Outstanding as of December 31, 2020 3,795 $ 2.21 3.4 $ 26,441 Granted 1,825 7.29 6.2 - Forfeited (505 ) 8.50 - - Expired (5 ) 1.39 Outstanding as of December 31, 2021 5,110 $ 3.27 3.4 $ 20,820 Options vested and exercisable 3,994 $ 2.51 2.6 $ 19,218 The following table summarizes weighted average assumptions used in determining the fair value of the stock options at the date of grant during Fiscal 2021 and 2020: Summary of Weighted Average Assumptions Used in Determining Fair Value of Options For the years ended December 31, 2021 2020 Exercise price $ 7.29 $ 4.58 Expected term (years) 4.0 4.2 Expected stock price volatility 79 % 52 % Risk-free rate of interest 0.8 % 0 % 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 2021 and 2020 was $ 6.1 million and $ 1.4 million, respectively. For Fiscal 2021 and 2020, we charged to operations approximately $ 2.9 million and $ 1.2 million, respectively, for share-based compensation expense for the aggregate fair value of the vested stock options earned. As of December 31, 2021, there were 5,085,000 stock options outstanding and 275,785 stock options available to be issued. We will recognize an aggregate of approximately $ 3,219,000 of remaining share-based compensation expense related to outstanding stock options over a weighted average period of 3 years. Stock Warrants During Fiscal 2021, we 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 a public offering. During Fiscal 2021, we issued 5,986 shares of common stock through a cashless exercise of 50,000 common stock warrants. During Fiscal 2020, 450,000 three -year warrants were issued to various consultants with vesting terms of one year or less and exercise prices of $ 3.00 to $ 5.00 per share. The following table summarizes warrant activities during Fiscal 2021 and 2020 (in thousands, except per share data): Schedule of Warrant Activity Number of Shares Weighted Average Exercise Weighted Average Outstanding as of January 1, 2020 - $ - - Warrants granted 450 3.22 3.0 Outstanding as of December 31, 2020 450 $ 3.22 2.7 Warrants granted 455 12.83 3.0 Cashless exercise (50 ) 5.00 - Outstanding as of December 31, 2021 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 2021 and Fiscal 2020: Summary of Weighted Average Assumptions Used in Determining Fair Value of Warrants For the years ended December 31, 2021 2020 Exercise price $ 12.83 $ 3.22 Expected term (years) 3.0 2.0 Expected stock price volatility 81 % 58 % Risk-free rate of interest 0.2 % 0 % Expected dividend yield (per share) 0 % 0 % As of December 31, 2021, there were 855,000 warrants outstanding and we recognized $ 253,000 and $ 178,000 of share-based compensation expense during Fiscal 2021 and 2020, respectively. |
Defined Contribution Plans
Defined Contribution Plans | 12 Months Ended |
Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |
Defined Contribution Plans | Note 8 – Defined Contribution Plans We maintain the ProPhase Labs, Inc. 401(k) Savings and Retirement Plan, a defined contribution plan for our employees. Our contributions to the plan are based on the amount of the employee plan contributions and compensation. Our contributions to the plan in Fiscal 2021 and 2020 were $ 112,000 and $ 71,000 , respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 9 – Income Taxes The components of the provision (benefit) for income taxes, in the consolidated statements of operations are as follows (in thousands): Schedule of Components of Income Tax Expense (Benefit) December 31, 2021 December 31, 2020 For the years ended December 31, 2021 December 31, 2020 Continuing Operations Current Federal $ - $ - State 1,318 12 Current Total $ 1,318 $ 12 Deferred Federal (1,511 ) - State (775 ) - Deferred Total $ (2,286 ) $ - Income taxes from continuing operations $ (968 ) $ 12 A reconciliation of the statutory federal income tax expense (benefit) to the effective tax is as follows (in thousands): Schedule of Effective Income Tax Rate Reconciliation 2021 2020 Statutory Rate - federal $ 1,232 $ (377 ) State taxes, net of federal benefit 366 (31 ) Permanent differences and other 227 159 Income taxes from continuing operations before valuation allowance $ 1,825 $ (249 ) Change in valuation allowance (2,793 ) 261 Income tax expense (benefit) $ (968 ) $ 12 Total $ (968 ) $ 12 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): Schedule of Deferred Tax Assets and Liabilities December 31, 2021 December 31, 2020 For the years ended December 31, 2021 December 31, 2020 Net operating loss and capital loss carryforward $ 3,584 $ 5,020 Right of use asset 1,348 1,086 Other 2,531 370 Capital lease obligations (1,348 ) (1,086 ) Depreciation (948 ) (419 ) Amortization (2,989 ) - Valuation allowance (2,178 ) (4,971 ) Total - - We recognize 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. We are 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. A valuation allowance for all of our net deferred tax assets has been provided as we are unable to determine, at this time, that the generation of future taxable income against which the net operating losses (“NOL”) carryforwards could be used is more likely than not. As a result of ongoing losses from continuing operations the Company has concluded that it is more likely than not that it will not realize all of its deferred tax assets relating to federal and state filing jurisdictions. As of December 31, 2021, there is a valuation allowance of $ 2.2 million. As of December 31, 2021, the Company has state NOL carryforwards of $ 1.14 million, which begin to expire in 2024 and federal NOL carryforwards of $ 2.42 million. Most of the federal NOL, generated prior to the 2017 legislation commonly referred to as the Tax Cuts and Jobs Act (“TCJA”), was utilized in 2021 with the exception of $ 0.1 million, which may be carried forward for 20 years and begins to expire in 2026 . The remaining amount of $ 2.3 million federal NOL generated in years 2018 and after may be carried forward indefinitely and its utilization is limited to 80 % of taxable income for tax years post 2021. Some of the post 2017 NOL is attributable to 2021 Nebula acquisition, and it is Section 382 limited ($ 0.9 million NOL (Nebula carryforward) has an annual limitation of $ 0.3 million and the remaining post 2017 NOL of $ 1.4 million is not limited under Section 382). We file 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, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Other Current Liabilities | Note 10 - Other Current Liabilities The following table sets forth the components of other current liabilities at December 31, 2021 and 2020, respectively (in thousands): Schedule of Other Current Liabilities December 31, December 31, 2021 2020 Accrued diagnostic services commissions $ 1,283 $ 461 Accrued payroll 514 464 Accrued expenses 300 304 Accrued returns 338 291 Accrued income tax payable 1,312 8 Accrued benefits and vacation 60 34 Total other current liabilities $ 3,807 $ 1,562 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 11 – Commitments and Contingencies Escrow Receivable Effective March 29, 2017, we sold our intellectual property rights and other assets related to our Cold-EEZE® brand and product line, including all then current and pipeline over-the-counter allergy, cold, flu, multi-symptom relief and immune support treatments for adults and children to the extent each was, or was intended to be, branded “Cold-EEZE®”, including all formulations and derivatives thereof (collectively referred to as the “Cold-EEZE® Business”) to Mylan Consumer Healthcare Inc. (formerly known as Meda Consumer Healthcare Inc.) (“MCH”) and Mylan Inc. (together with MCH, “Mylan”). As a result of the sale of the Cold-EEZE® business, for Fiscal 2017, we have classified as discontinued operations (i) all income and expenses attributable to the Cold-EEZE® business, (ii) the gain from the sale of the Cold-EEZE® business, and (iii) the income tax expense attributed to the sale of the Cold-EEZE® business. Excluded from the sale of the Cold-EEZE® business were our accounts receivable and inventory. We have also retained all liabilities associated with our Cold-EEZE® business operations arising prior to March 29, 2017. For Fiscal 2021, no income from discontinued operations was recorded. For Fiscal 2020, we incurred income of $ 201,000 , which was recorded as income (loss) on sale of discontinued operations. We have indemnification obligations to Mylan under the asset purchase agreement pursuant to which we sold the Cold-EEZE ® Pursuant to the terms of the asset purchase agreement, we, Mylan, and an escrow agent entered into an Escrow Agreement at closing, pursuant to which Mylan deposited $ 5.0 million of the aggregate purchase price for the Cold-EEZE ® On May 4, 2020, the final pending claim against our escrow account with Mylan was resolved and, as a result, the escrow agent released all funds from the escrow account to us on May 7, 2020, in the amount of $ 4.8 million. 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, 2022 . 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 . The Company has received Nurya’s intent to renew the Manufacturing Agreement and the current termination date is March 29, 2023. Future Obligations We have estimated future minimum obligations for an executive’s employment agreement over the next five years as of December 31, 2021, as follows (in thousands): Schedule of Estimated Future Minimum Obligations Employment Contracts 2022 $ 675 2023 675 2024 675 2025 675 2026 675 Total $ 3,375 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, 2021 | |
Leases | |
Leases | Note 12 – Leases On October 23, 2020, we 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 . On December 8, 2020, the Company entered into a Lease Agreement (the “NY Lease”) with BRG Office L.L.C. and Unit 2 Associates L.L.C. (the “Landlord”), pursuant to which the Company has agreed to lease certain premises located on the second floor (the “Leased Premises”) of 711 Stewart Avenue, Garden City, New York (the “Building”). The Leased Premises serve as the Company’s second location, 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 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 seven months (the “Initial Term”), unless sooner terminated as provided in the NY Lease. We may extend the term of the NY Lease for one additional option period of five years. We have the option to terminate the NY Lease on the sixth anniversary of the Commencement Date, provided that we give 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 Lease, we will pay 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, we are responsible for its proportionate share of real estate tax escalations in accordance with the terms of the NY Lease. We also have 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. We also have a right of first offer to purchase the Building during the term of the NY Lease . At December 31, 2021, we had operating lease liabilities for the New York and New Jersey leases of approximately $ 4.9 million and right of use assets of approximately $ 4.4 million, which were included in the consolidated balance sheet. The following summarizes quantitative information about our operating leases (in thousands): Summary of Quantitative Information About Operating Leases December 31, 2021 December 31, 2020 For the Years Ended December 31, 2021 December 31, 2020 Operating leases Operating lease cost $ 816 $ 11 Variable lease cost $ - $ 1 Operating lease expense 816 12 Total rent expense $ 816 $ 12 December 31, 2021 December 31, 2020 For the Years Ended December 31, 2021 December 31, 2020 Operating cash flows used in operating leases $ (357 ) $ (11 ) Right-of-use assets obtained in exchange for operating lease liabilities $ - $ 4,740 Weighted-average remaining lease term – operating leases (in years) 9.4 10.3 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): Schedule of Maturity of Operating Leases Year Ended December 31, 2022 $ 774 Year Ended December 31, 2023 738 Year Ended December 31, 2024 747 Year Ended December 31, 2025 768 Year Ended December 31, 2026 783 Thereafter 3,876 Total 7,686 Less present value discount (2,825 ) Operating lease liabilities $ 4,861 |
Consulting Agreement and Secure
Consulting Agreement and Secured Promissory Note Receivable | 12 Months Ended |
Dec. 31, 2021 | |
Consulting Agreement And Secured Promissory Note Receivable | |
Consulting Agreement and Secured Promissory Note Receivable | Note 13 – Consulting Agreement and Secured Promissory Note Receivable Consulting Agreement On September 25, 2020, we entered into a consulting agreement (the “Consulting Agreement”) with a company acting as a consultant (the “Consultant”). The Consulting Agreement was to be effective through September 1, 2022; provided, however, that we 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”), we entered into the Secured Note with the Consultant, pursuant to which we 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 we 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 we loaned $ 250,000 to the Consultant. The Secured Note bears interest at a rate of 15 % per annum from and including the Restatement Effective Date until the principal amount is repaid in full plus any Principal Increases (as defined below) together with any accrued interest that has not been capitalized; provided, however Interest under the Secured Note will be payable monthly in arrears on the first day of each month for the prior monthly period, as well as at maturity (whether upon demand, by acceleration or otherwise) (each such date, a “Payment Date”); provided, however, that prior to September 1, 2021, interest will be paid and capitalized in kind by increasing the principal amount of the Secured Note (any such increase, a “Principal Increase”) by an amount equal to the interest accrued on the principal amount (as increased by the Principal Increases) during the prior month. On each Payment Date commencing after September 1, 2021, in addition to payments of interest described in the preceding sentence, the Consultant will also make payments on the principal amount of the loan equal to 1/36 of the then outstanding principal amount. The amount of the monthly payments will be equal to the amount required to amortize fully the outstanding principal amount of the loan, together with interest, over a period of 36 months. 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, will be due and payable, if not sooner paid, on September 30, 2022, or an earlier date as a result of a maturity, whether by acceleration or otherwise. The Secured Note may be prepaid in full or in part at any time without penalty or premium. The Secured 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 Secured Note may be accelerated. The Secured Note contains customary representation and warranties and certain restrictive covenants which, among other things, restrict the Consultant’s ability to (i) sell, transfer, finance, lease, license, or dispose of all or substantially all of its property or assets, liquidate, windup, or dissolve, (ii) acquire all or substantially all of the property or assets of, or the equity interests in, any other person, (iii) participate in any merger, consolidation, share exchange, division, conversion, reclassification, or other absorption or reorganization, (iv) except for those existing as of the Restatement Effective Date, create, incur, assume, permit, or suffer to exist any pledges, liens, security interests, and other encumbrances of its property or assets, whether now owned or hereafter owned or acquired, and (v) create, incur or permit to exist any debt that is senior to, or pari passu In order to secure the Consultant’s obligations under the Secured Note, the Consultant granted to the Company a continuing security interest in certain property and assets. Total interest income recorded in the years ended December 31, 2021 and 2020, was $ 642,000 62,000 , respectively. Amendment and Termination Agreement On January 14, 2021, we 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 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. We 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, 2021, 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 $ 3.75 million during the year ended December 31, 2021 to bad debt expense, which is included in other income (loss) on the accompanying statements of operations. October 2020 Promissory Note On October 22, 2020, we entered into a promissory note with an unrelated third party pursuant to which we loaned $ 300,000 to such entity. The promissory note bears interest at a rate of 10 % per annum and was repaid in the first quarter of Fiscal 2021. |
Significant Customers
Significant Customers | 12 Months Ended |
Dec. 31, 2021 | |
Risks and Uncertainties [Abstract] | |
Significant Customers | Note 14 – Significant Customers Concentrations Revenue for Fiscal 2021 and Fiscal 2020 was $ 79.0 million and $ 14.5 million, respectively. Three diagnostic services clients accounted for 23.5 %, 17.9 %, and 11.9% , respectively, of our net revenue for the year ended December 31, 2021. For Fiscal 2020, two third-party contract manufacturing customers accounted for 47.1 % and 17.2 %, respectively, of revenues from continuing operations. 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 2021, requisitions from each payer group were 60 35 5 We are 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 our 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 us. 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. Three of our consumer products customers represented 36 %, 20 % and 13 % of our total trade receivable balances at December 31, 2020. Currently, we rely on a sole supplier to manufacture our saliva collection kits used by customers who purchase our personal genomics services. Change in the supplier or design of certain of the materials that we rely 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, 2021 | |
Segment Reporting [Abstract] | |
Segment Information | Note 15 – 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 2021 and Fiscal 2020 (in thousands): Schedule of Segment Information December 31, 2021 December 31, 2020 For the years ended December 31, 2021 December 31, 2020 Net revenues Diagnostic services $ 68,559 $ 1,277 Consumer products 10,483 13,237 Consolidated net revenue 79,042 14,514 Cost of revenue Diagnostic services 29,415 644 Consumer products 7,639 9,264 Consolidated cost of revenue 37,054 9,908 Depreciation and amortization expense Diagnostic services 1,976 37 Consumer products 7 89 Total Depreciation and amortization expense 1,983 126 Operating and other expenses 34,700 6,818 Income (loss) from continuing operations, before income taxes Diagnostic services 18,197 (270 ) Consumer products (1,714 ) 1,962 Unallocated corporate (11,178 ) (4,006 ) Total income (loss) from continuing operations, before income taxes 5,305 (2,314 ) Income tax benefit (expense) 968 (12 ) Total income (loss) from continuing operations, after income taxes 6,273 (2,326 ) Income from discontinued operations, before income taxes - 201 Net income (loss) $ 6,273 $ (2,125 ) The following table is a summary of segment information for Fiscal 2021 and Fiscal 2020 (in thousands): December 31, December 31, 2021 2020 ASSETS Diagnostic services $ 51,150 $ 13,410 Consumer products 24,139 6,261 Unallocated corporate 14,006 11,734 Total assets $ 89,295 $ 31,405 |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | Note 16 – Earnings (Loss) Per Share Basic earnings (loss) 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): Schedule of Basic and Diluted Net Loss Per Share December 31, 2021 December 31, 2020 For the years ended December 31, 2021 December 31, 2020 Net income (loss) - basic $ 6,273 $ (2,125 ) Interest on unsecured convertible promissory note 1,000 - Net income (loss) - diluted $ 7,273 $ (2,125 ) Weighted average shares outstanding - basic 15,172 11,595 Diluted shares- Stock Options 2,001 - Diluted shares- Stock Warrants 220 - Unsecured convertible promissory note 1,000 - Weighted average shares outstanding - diluted 18,393 11,595 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): Schedule of Anti-dilutive Securities Excluded from the Income Per Share Computation December 31, 2021 December 31, 2020 For the years ended Anti-dilutive securities December 31, 2021 December 31, 2020 Common stock purchase warrants 455 450 Stock Options 828 3,795 Unsecured convertible promissory note - 1,000 Anti-dilutive securities 1,283 5,245 |
Related Parties
Related Parties | 12 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Parties | Note 17 – Related Parties Jason Karkus, Executive Vice President and Co-Chief Operations Officer of ProPhase Diagnostics, is the son of Ted Karkus, the Company’s Chairman and Chief Executive Officer. For Fiscal 2021, Mr. Karkus received an annual base salary of $ 204,000 850,000 468,000 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 18 – Subsequent Events Declaration of Cash Dividend 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. Entry in a Material Definitive Agreement On February 28, 2022, we entered into a letter agreement (the “Letter Agreement”) with Justin J. Leonard (the “Holder”) providing for the payoff of certain Unsecured Promissory Note and Guaranty in the principal amount of $ 2,000,000 , dated as of September 15, 2020, by and between the Company and the Holder (the “Note”). Pursuant to the terms of the Letter Agreement, (i) the Holder converted $ 600,000 of the principal amount due to him under the Note into 200,000 shares of common stock of the Company (the “Conversion Shares”) at a prices of $ 3.00 per share as provided for under the terms of the Note (the “Conversion”), (ii) the Company paid to the Holder $ 1,440,548 in cash, representing $ 1,400,000 of the remaining principal under the Note following the Conversion plus $ 40,548 in accrued and outstanding interest under the 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 Holder of $ 2,590,548 ). Government Agency Announcement On March 15, 2022, HRSA, which constituted $ 42.0 57.6 of our fiscal 2021 diagnostic service revenue, announced that the uninsured program would stop accepting claims for payment of COVID-19 testing and treatments as of March 22, 2022. See Note 2, Business Risks and Uncertainties |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
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 FASB 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 and personal genomics products and services). See Note 15 Segment Information. |
Business and Liquidity Risks and Uncertainties | Business and Liquidity Risks and Uncertainties We launched our diagnostic service business in December 2020 and expanded in January 2021 with the opening of our new Garden City, New York CLIA accredited laboratory. Our diagnostic service business is and will continue to be influenced by the level of demand for COVID-19 and other diagnostic testing, how long this demand persists and the prices we are able to receive for performing 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. There are still numerous uncertainties associated with the COVID-19 pandemic, including the efficacy of the vaccines that have been developed to treat the virus and their ability to protect against new strains of the virus, people’s willingness to receive a vaccine, possible resurgences of the coronavirus and/or new strains of the virus, the extent and duration of protective and preventative measures that may be adopted by local, state and/or the federal government in the future as a result of future outbreaks, the duration of any future business closures, the ongoing impact of COVID-19 on the U.S. and world economy and consumer confidence, and various other uncertainties all of which could negatively impact our Company as a whole. While our revenues increased significantly for the year ended December 31, 2021 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 payors. 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. Approximately 59.5 Further, our diagnostic service business is subject to extensive federal, state, and local laws and regulations, all of which are subject to change, as well as laws and regulations governing the submission of claims for payment for our services, such as those relating to: coverage of our services under Medicare, Medicaid and other federal health care programs; the amounts that we may bill for our services; and the party to which we must submit claims. In addition, reimbursement policies and requirements for some payers and procedures are ambiguous, which could lead to billing errors and related disputes. There can be no assurance that our efforts to offer and perform COVID-19 or other diagnostic testing will be successful in the future or that the revenue and operating profits from such business will increase or maintain their current level. We acquired and commenced our personal genomics business in August 2021. This business is and will continue to be influenced by demand for our genetic testing products and services, our marketing and service capabilities, and our ability to comply with applicable regulatory requirements. The Company used cash in operating activities of $ 13.6 17.4 However, due to the nature of the diagnostic business and its focus thus far on COVID-19, there are inherent uncertainties associated with managements’ business plan and cash flow projections if we are unable to grow our diagnostic testing business beyond our COVID-19 testing services. 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 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 | 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 Cash Restricted cash as of December 31, 2021 includes approximately $ 250,000 held in escrow related to a potential purchase of an additional lab facility. The potential purchase was not consummated, and we are pursuing the return of the escrow. |
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 0.65% to 4.88% during fiscal 2021. 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): Summary of Components of Marketable Securities As of December 31, 2021 Amortized Unrealized Unrealized Fair Cost Gains Losses Value U.S. government obligations $ 650 $ 17 $ - $ 667 Corporate obligations 8,304 - (192 ) 8,112 $ 8,954 $ 17 $ (192 ) $ 8,779 As of December 31, 2020 Amortized Unrealized Unrealized Fair Cost Gains Losses Value U.S. government obligations $ 1,021 $ - $ (7 ) $ 1,014 Corporate obligations 629 - (4 ) 625 $ 1,650 $ $ (11 ) $ 1,639 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 . The fair value of the Investment Shares as of December 31, 2021, was based upon the closing stock price of $ 0.06 per share. The investment was classified as a Level 1 financial instrument. We recorded a $ 240,000 decrease in fair value of investment securities within the statement of operations for the year ended December 31, 2021. |
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): Schedule of Accounts Receivable Net December 31, 2021 December 31, 2020 Trade accounts receivable $ 18,520 $ 1,975 Unbilled accounts receivable 23,089 1,215 Accounts receivable, gross 41,609 3,190 Less allowances (3,901 ) (35 ) Total accounts receivable $ 37,708 $ 3,155 For Fiscal 2021, we recorded $ 3.9 35,000 |
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, 2021 and 2020, the components of inventory are as follows (in thousands): Schedule of Components of Inventory December 31, December 31, 2021 2020 Diagnostic services testing material $ 2,989 $ 1,028 Raw materials 1,514 1,550 Work in process 260 440 Finished goods 272 188 Inventory $ 5,035 $ 3,206 Inventory valuation reserve $ (435 ) $ (167 ) Inventory, net $ 4,600 $ 3,039 |
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 to thirty-nine years; machinery and equipment including lab equipment - three to seven years; computer equipment and software - three to five years; and furniture and fixtures - five years. |
Concentration of Financial Risks | 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, 2021, our cash and cash equivalents and restricted cash balance was $ 8.7 million. Of the total bank balance, $ 1.0 million was covered by federal depository insurance and $ 7.7 million was uninsured at December 31, 2021. 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 14, Consulting Agreement and Secured Promissory Note Receivable and Consulting Agreement), balances due to us. As of December 31, 2021 and the financial statements reporting date, the Company did not expect full realization upon maturity. In addition, see Note 14 - Significant Customers. |
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 e.g |
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. 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, 2021 and 2020, 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): Schedule of Fair Value of Financial Instruments As of December 31, 2021 Level 1 Level 2 Level 3 Total Marketable debt securities U.S. government obligations $ - $ 667 $ - $ 667 Corporate obligations - 8,112 - 8,112 Marketable equity securities 76 - - 76 $ 76 $ 8,779 $ - $ 8,855 As of December 31, 2020 Level 1 Level 2 Level 3 Total Marketable debt securities U.S. government obligations $ - $ 1,014 $ - $ 1,014 Corporate obligations - 625 - 625 $ - $ 1,639 $ - $ 1,639 There were no transfers of marketable debt securities between Levels 1, 2 or 3 for the Fiscal 2021 and 2020. |
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. Before fiscal 2021, we had historically generated sales principally through two types of customers, contract manufacturing and retail customers for our consumer products. Sales from product shipments to contract manufacturing and retailer customers are recognized at the time ownership is transferred to the customer. As of December 2020, we also began generating revenues through diagnostic services and in August 2021 we acquired a personal genomics business. 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 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. Recognize Revenue When the Company Satisfies a Performance Obligation 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. 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 $ 0.4 million for the year ended December 31, 2021. Contract Balances As of December 31, 2021 and December 31, 2020, we have deferred revenue of $ 2.9 million and $ 0.3 million , respectively. Our new personal genomics business comprised $ 2.7 million of the deferred revenue as of December 31, 2021. 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): Schedule of Deferred Revenue As of December 31, 2021 As of December 31, 2020 Recognition Period 0-12 Months $ 2,034 $ 169 13-24 Months 530 84 Over 24 Months 375 78 Total $ 2,939 $ 331 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 2021 and 2020 (in thousands): Schedule of Disaggregation by Revenue For the years ended Revenue by Customer Type December 31, 2021 December 31, 2020 Diagnostic services $ 68,559 $ 1,277 Contract manufacturing 5,786 12,252 Retail and others 2,454 985 Genomic products and services 2,243 - Total revenue, net $ 79,042 $ 14,514 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 2021 and 2020 were $ 361,000 and $ 766,000 , 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. Stock and stock options to purchase our common stock have been granted to employees pursuant to the terms of certain agreements and stock option plans (see Note 7). Stock options are exercisable during a period determined by us, but in no event later than seven years from the date granted. |
Research and Development | Research and Development R&D costs are charged to operations in the period incurred, R&D costs incurred for Fiscal 2021 and 2020 were $ 520,000 and $ 633,000 , 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 in association 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 carryback, 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 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. As a result of our historical losses from continuing operations, we have recorded a full valuation allowance against a net deferred tax asset. Additionally, we have not recorded a liability for unrecognized tax benefit. |
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 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): Schedule of Accounting Standards Update and Adoption Excluding impacts of adoption of ASU 2021-08 Adjustment Presentation with adoption of ASU 2021-08 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): Excluding impacts of adoption of ASU 2021-08 Adjustment Presentation with adoption of ASU 2021-08 Year ended 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. In December 2019, the FASB issued ASU No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which is intended to simplify 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 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 September 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326). The ASU sets forth a “current expected credit loss” (CECL) model which requires the Company to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost and applies to some off-balance sheet credit exposures. In February 2020, the FASB issued ASU 2020-02, Financial Instruments - Credit Losses (Topic 326), which amends the effective date of the original pronouncement for smaller reporting companies. ASU 2016-13 and its amendments will be effective for the Company for interim and annual periods in fiscal years beginning after December 15, 2022. We are currently assessing the impact of the adoption of this ASU on our financial statements. The FASB 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 Earnings Per Share In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40). This ASU reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that remain equity classified after modification or exchange. This ASU provides guidance for a modification or an exchange of a freestanding equity-classified written call option that is not within the scope of another Topic. It specifically addresses: (1) how an entity should treat a modification of the terms or conditions or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange; (2) how an entity should measure the effect of a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange; and (3) how an entity should recognize the effect of a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange. This ASU will be effective for all entities for fiscal years beginning after December 15, 2021. An entity should apply the amendments prospectively to modifications or exchanges occurring on or after the effective date of the amendments. Early adoption is permitted, including adoption in an interim period. The adoption of ASU 2021-04 is not expected to have a material impact on the Company’s financial statements or disclosures. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Components of Marketable Securities | Summary of Components of Marketable Securities As of December 31, 2021 Amortized Unrealized Unrealized Fair Cost Gains Losses Value U.S. government obligations $ 650 $ 17 $ - $ 667 Corporate obligations 8,304 - (192 ) 8,112 $ 8,954 $ 17 $ (192 ) $ 8,779 As of December 31, 2020 Amortized Unrealized Unrealized Fair Cost Gains Losses Value U.S. government obligations $ 1,021 $ - $ (7 ) $ 1,014 Corporate obligations 629 - (4 ) 625 $ 1,650 $ $ (11 ) $ 1,639 |
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): Schedule of Accounts Receivable Net December 31, 2021 December 31, 2020 Trade accounts receivable $ 18,520 $ 1,975 Unbilled accounts receivable 23,089 1,215 Accounts receivable, gross 41,609 3,190 Less allowances (3,901 ) (35 ) Total accounts receivable $ 37,708 $ 3,155 |
Schedule of Components of Inventory | At December 31, 2021 and 2020, the components of inventory are as follows (in thousands): Schedule of Components of Inventory December 31, December 31, 2021 2020 Diagnostic services testing material $ 2,989 $ 1,028 Raw materials 1,514 1,550 Work in process 260 440 Finished goods 272 188 Inventory $ 5,035 $ 3,206 Inventory valuation reserve $ (435 ) $ (167 ) Inventory, net $ 4,600 $ 3,039 |
Schedule of Fair Value of Financial Instruments | Schedule of Fair Value of Financial Instruments As of December 31, 2021 Level 1 Level 2 Level 3 Total Marketable debt securities U.S. government obligations $ - $ 667 $ - $ 667 Corporate obligations - 8,112 - 8,112 Marketable equity securities 76 - - 76 $ 76 $ 8,779 $ - $ 8,855 As of December 31, 2020 Level 1 Level 2 Level 3 Total Marketable debt securities U.S. government obligations $ - $ 1,014 $ - $ 1,014 Corporate obligations - 625 - 625 $ - $ 1,639 $ - $ 1,639 |
Schedule of Deferred Revenue | The following table disaggregates our deferred revenue by recognition period (in thousands): Schedule of Deferred Revenue As of December 31, 2021 As of December 31, 2020 Recognition Period 0-12 Months $ 2,034 $ 169 13-24 Months 530 84 Over 24 Months 375 78 Total $ 2,939 $ 331 |
Schedule of Disaggregation by Revenue | The following table disaggregates the Company’s revenue by revenue source for Fiscal 2021 and 2020 (in thousands): Schedule of Disaggregation by Revenue For the years ended Revenue by Customer Type December 31, 2021 December 31, 2020 Diagnostic services $ 68,559 $ 1,277 Contract manufacturing 5,786 12,252 Retail and others 2,454 985 Genomic products and services 2,243 - Total revenue, net $ 79,042 $ 14,514 |
Business Acquisitions (Tables)
Business Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Business Acquisition [Line Items] | |
Schedule of Intangible Assets Acquisition | The intangible assets preliminarily identified in conjunction with the Nebula Acquisition are as follows (in thousands): Schedule of Intangible Assets Acquisition Estimated Useful Gross Carrying Value Life (in years) 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, 2020. 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): Schedule of Pro-forma Results December 31, 2021 December 31, 2020 For the years ended December 31, 2021 December 31, 2020 Revenue, net $ 81,164 $ 15,560 Net loss $ 6,135 $ (3,682 ) |
Nebula Acquisition [Member] | |
Business Acquisition [Line Items] | |
Schedule of Assets Acquired and Liabilities Assumed | Schedule of Assets Acquired and Liabilities Assumed 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. |
CPM acquisition [Member] | |
Business Acquisition [Line Items] | |
Schedule of Assets Acquired and Liabilities Assumed | Schedule of Assets Acquired and Liabilities Assumed Account Amount Clinical lab material $ 180 Lab equipment 112 Definite-lived intangible asset 1,307 Total assets acquired 1,599 Deferred tax liability (362 ) Total liabilities assumed (362 ) Net identifiable assets acquired 1,237 Goodwill 1,263 Total consideration $ 2,500 |
Goodwill and Acquired Intangi_2
Goodwill and Acquired Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes In Goodwill | Changes in goodwill for Fiscal 2021 are as follows (in thousands): Schedule of Changes In Goodwill Amount Goodwill, beginning of Fiscal 2020 $ - Acquisition of CPM 901 Goodwill, beginning of Fiscal 2021 901 Adjustment for deferred tax liability 362 Acquisition of Nebula 4,446 Goodwill, end of Fiscal 2021 $ 5,709 |
Schedule of Intangible Assets | Intangible assets as of December 31, 2021 and 2020 consisted of the following (in thousands): Schedule of Intangible Assets December 31, December 31, Estimated Useful 2021 2020 Life (in years) Trade names $ 5,550 $ - 15 Proprietary intellectual property 4,260 - 5 Customer relationships 1,180 - 1 CLIA license 1,307 1,307 3 Total intangible assets, gross 12,297 1,307 Less: accumulated amortization (1,445 ) (73 ) Total intangible assets, net $ 10,852 $ 1,234 |
Schedule Estimated Future Amortization Expense of Acquired Intangible Assets | Schedule Estimated Future Amortization Expense of Acquired Intangible Assets Year ended December 31, 2022 $ 2,378 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 Thereafter 3,555 Total $ 10,852 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | The components of property, plant and equipment are as follows (in thousands): Schedule of Property, Plant and Equipment December 31, December 31, 2021 2020 Estimated Useful Life Land $ 352 $ 352 Building improvements 1,729 1,729 10 - 39 years Machinery 4,740 4,441 3 - 7 years Lab equipment 4,330 1,002 3 - 7 years Computer equipment and software 1,211 881 3 - 5 years Furniture and fixtures 468 194 5 years Property, Plant and Equipment, Gross 12,830 8,599 Less: accumulated depreciation (6,883 ) (5,021 ) Total property, plant and equipment, net $ 5,947 $ 3,578 |
Stockholders_ Equity (Tables)
Stockholders’ Equity (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
Schedule of Stock Options Activity | The following table summarizes stock options activity during Fiscal 2021 and 2020 for the Amended 2010 Plan, the Amended 2010 Directors’ Plan, the 2018 Stock Plan and the Inducement Award (in thousands, except per share data). Schedule of Stock Options Activity Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life Total Intrinsic Value Outstanding as of January 1, 2020 3,082 1.67 3.7 $ 1,085 Granted 713 4.58 7.0 - Outstanding as of December 31, 2020 3,795 $ 2.21 3.4 $ 26,441 Granted 1,825 7.29 6.2 - Forfeited (505 ) 8.50 - - Expired (5 ) 1.39 Outstanding as of December 31, 2021 5,110 $ 3.27 3.4 $ 20,820 Options vested and exercisable 3,994 $ 2.51 2.6 $ 19,218 |
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 2021 and 2020: Summary of Weighted Average Assumptions Used in Determining Fair Value of Options For the years ended December 31, 2021 2020 Exercise price $ 7.29 $ 4.58 Expected term (years) 4.0 4.2 Expected stock price volatility 79 % 52 % Risk-free rate of interest 0.8 % 0 % Expected dividend yield (per share) 0 % 0 % |
Schedule of Warrant Activity | The following table summarizes warrant activities during Fiscal 2021 and 2020 (in thousands, except per share data): Schedule of Warrant Activity Number of Shares Weighted Average Exercise Weighted Average Outstanding as of January 1, 2020 - $ - - Warrants granted 450 3.22 3.0 Outstanding as of December 31, 2020 450 $ 3.22 2.7 Warrants granted 455 12.83 3.0 Cashless exercise (50 ) 5.00 - Outstanding as of December 31, 2021 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 2021 and Fiscal 2020: Summary of Weighted Average Assumptions Used in Determining Fair Value of Warrants For the years ended December 31, 2021 2020 Exercise price $ 12.83 $ 3.22 Expected term (years) 3.0 2.0 Expected stock price volatility 81 % 58 % Risk-free rate of interest 0.2 % 0 % Expected dividend yield (per share) 0 % 0 % |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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): Schedule of Components of Income Tax Expense (Benefit) December 31, 2021 December 31, 2020 For the years ended December 31, 2021 December 31, 2020 Continuing Operations Current Federal $ - $ - State 1,318 12 Current Total $ 1,318 $ 12 Deferred Federal (1,511 ) - State (775 ) - Deferred Total $ (2,286 ) $ - Income taxes from continuing operations $ (968 ) $ 12 |
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): Schedule of Effective Income Tax Rate Reconciliation 2021 2020 Statutory Rate - federal $ 1,232 $ (377 ) State taxes, net of federal benefit 366 (31 ) Permanent differences and other 227 159 Income taxes from continuing operations before valuation allowance $ 1,825 $ (249 ) Change in valuation allowance (2,793 ) 261 Income tax expense (benefit) $ (968 ) $ 12 Total $ (968 ) $ 12 |
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): Schedule of Deferred Tax Assets and Liabilities December 31, 2021 December 31, 2020 For the years ended December 31, 2021 December 31, 2020 Net operating loss and capital loss carryforward $ 3,584 $ 5,020 Right of use asset 1,348 1,086 Other 2,531 370 Capital lease obligations (1,348 ) (1,086 ) Depreciation (948 ) (419 ) Amortization (2,989 ) - Valuation allowance (2,178 ) (4,971 ) Total - - |
Other Current Liabilities (Tabl
Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Current Liabilities | The following table sets forth the components of other current liabilities at December 31, 2021 and 2020, respectively (in thousands): Schedule of Other Current Liabilities December 31, December 31, 2021 2020 Accrued diagnostic services commissions $ 1,283 $ 461 Accrued payroll 514 464 Accrued expenses 300 304 Accrued returns 338 291 Accrued income tax payable 1,312 8 Accrued benefits and vacation 60 34 Total other current liabilities $ 3,807 $ 1,562 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Estimated Future Minimum Obligations | We have estimated future minimum obligations for an executive’s employment agreement over the next five years as of December 31, 2021, as follows (in thousands): Schedule of Estimated Future Minimum Obligations Employment Contracts 2022 $ 675 2023 675 2024 675 2025 675 2026 675 Total $ 3,375 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Leases | |
Summary of Quantitative Information About Operating Leases | The following summarizes quantitative information about our operating leases (in thousands): Summary of Quantitative Information About Operating Leases December 31, 2021 December 31, 2020 For the Years Ended December 31, 2021 December 31, 2020 Operating leases Operating lease cost $ 816 $ 11 Variable lease cost $ - $ 1 Operating lease expense 816 12 Total rent expense $ 816 $ 12 December 31, 2021 December 31, 2020 For the Years Ended December 31, 2021 December 31, 2020 Operating cash flows used in operating leases $ (357 ) $ (11 ) Right-of-use assets obtained in exchange for operating lease liabilities $ - $ 4,740 Weighted-average remaining lease term – operating leases (in years) 9.4 10.3 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): Schedule of Maturity of Operating Leases Year Ended December 31, 2022 $ 774 Year Ended December 31, 2023 738 Year Ended December 31, 2024 747 Year Ended December 31, 2025 768 Year Ended December 31, 2026 783 Thereafter 3,876 Total 7,686 Less present value discount (2,825 ) Operating lease liabilities $ 4,861 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information | The following table is a summary of segment information for Fiscal 2021 and Fiscal 2020 (in thousands): Schedule of Segment Information December 31, 2021 December 31, 2020 For the years ended December 31, 2021 December 31, 2020 Net revenues Diagnostic services $ 68,559 $ 1,277 Consumer products 10,483 13,237 Consolidated net revenue 79,042 14,514 Cost of revenue Diagnostic services 29,415 644 Consumer products 7,639 9,264 Consolidated cost of revenue 37,054 9,908 Depreciation and amortization expense Diagnostic services 1,976 37 Consumer products 7 89 Total Depreciation and amortization expense 1,983 126 Operating and other expenses 34,700 6,818 Income (loss) from continuing operations, before income taxes Diagnostic services 18,197 (270 ) Consumer products (1,714 ) 1,962 Unallocated corporate (11,178 ) (4,006 ) Total income (loss) from continuing operations, before income taxes 5,305 (2,314 ) Income tax benefit (expense) 968 (12 ) Total income (loss) from continuing operations, after income taxes 6,273 (2,326 ) Income from discontinued operations, before income taxes - 201 Net income (loss) $ 6,273 $ (2,125 ) The following table is a summary of segment information for Fiscal 2021 and Fiscal 2020 (in thousands): December 31, December 31, 2021 2020 ASSETS Diagnostic services $ 51,150 $ 13,410 Consumer products 24,139 6,261 Unallocated corporate 14,006 11,734 Total assets $ 89,295 $ 31,405 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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): Schedule of Basic and Diluted Net Loss Per Share December 31, 2021 December 31, 2020 For the years ended December 31, 2021 December 31, 2020 Net income (loss) - basic $ 6,273 $ (2,125 ) Interest on unsecured convertible promissory note 1,000 - Net income (loss) - diluted $ 7,273 $ (2,125 ) Weighted average shares outstanding - basic 15,172 11,595 Diluted shares- Stock Options 2,001 - Diluted shares- Stock Warrants 220 - Unsecured convertible promissory note 1,000 - Weighted average shares outstanding - diluted 18,393 11,595 |
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): Schedule of Anti-dilutive Securities Excluded from the Income Per Share Computation December 31, 2021 December 31, 2020 For the years ended Anti-dilutive securities December 31, 2021 December 31, 2020 Common stock purchase warrants 455 450 Stock Options 828 3,795 Unsecured convertible promissory note - 1,000 Anti-dilutive securities 1,283 5,245 |
Summary of Components of Market
Summary of Components of Marketable Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Amortized Cost | $ 8,954 | $ 1,650 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 17 | |
Unrealized Losses | (192) | (11) |
Fair Value | 8,779 | 1,639 |
U.S. Government Obligations [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Amortized Cost | 650 | 1,021 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 17 | |
Unrealized Losses | (7) | |
Fair Value | 667 | 1,014 |
Corporate Obligations [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Amortized Cost | 8,304 | 629 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | ||
Unrealized Losses | (192) | (4) |
Fair Value | $ 8,112 | $ 625 |
Schedule of Accounts Receivable
Schedule of Accounts Receivable Net (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||
Trade accounts receivable | $ 18,520 | $ 1,975 |
Unbilled accounts receivable | 23,089 | 1,215 |
Accounts receivable, gross | 41,609 | 3,190 |
Less allowances | (3,901) | (35) |
Total accounts receivable | $ 37,708 | $ 3,155 |
Schedule of Components of Inven
Schedule of Components of Inventory (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||
Diagnostic services testing material | $ 2,989 | $ 1,028 |
Raw materials | 1,514 | 1,550 |
Work in process | 260 | 440 |
Finished goods | 272 | 188 |
Inventory | 5,035 | 3,206 |
Inventory valuation reserve | (435) | (167) |
Inventory, net | $ 4,600 | $ 3,039 |
Schedule of Fair Value of Finan
Schedule of Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair value of marketable debt securities | $ 8,855 | $ 1,639 |
Marketable equity securities | 76 | |
Fair Value, Inputs, Level 1 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair value of marketable debt securities | 76 | |
Marketable equity securities | 76 | |
Fair Value, Inputs, Level 2 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair value of marketable debt securities | 8,779 | 1,639 |
Marketable equity securities | ||
Fair Value, Inputs, Level 3 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair value of marketable debt securities | ||
Marketable equity securities | ||
U.S. Government Obligations [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair value of marketable debt securities | 667 | 1,014 |
U.S. Government Obligations [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair value of marketable debt securities | ||
U.S. Government Obligations [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair value of marketable debt securities | 667 | 1,014 |
U.S. Government Obligations [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair value of marketable debt securities | ||
Corporate Obligations [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair value of marketable debt securities | 8,112 | 625 |
Marketable equity securities | 76 | |
Corporate Obligations [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair value of marketable debt securities | ||
Corporate Obligations [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair value of marketable debt securities | 8,112 | 625 |
Corporate Obligations [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair value of marketable debt securities |
Schedule of Deferred Revenue (D
Schedule of Deferred Revenue (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Total | $ 2,939 | $ 331 |
0-12 Months [Member] | ||
Total | 2,034 | 169 |
13-24 Months [Member] | ||
Total | 530 | 84 |
Over 24 Months [Member] | ||
Total | $ 375 | $ 78 |
Schedule of Disaggregation by R
Schedule of Disaggregation by Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Product Information [Line Items] | ||
Total revenue, net | $ 79,042 | $ 14,514 |
Diagnostic Services [Member] | ||
Product Information [Line Items] | ||
Total revenue, net | 68,559 | 1,277 |
Contract Manufacturing [Member] | ||
Product Information [Line Items] | ||
Total revenue, net | 5,786 | 12,252 |
Retail and Other [Member] | ||
Product Information [Line Items] | ||
Total revenue, net | 2,454 | 985 |
Genomic Products and Services [Member] | ||
Product Information [Line Items] | ||
Total revenue, net | $ 2,243 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 12 Months Ended | |||||
Dec. 31, 2021 | Dec. 31, 2020 | Oct. 23, 2021 | Aug. 10, 2021 | Jun. 25, 2021 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | ||||||
Revenue percentage | 59.50% | |||||
Net cash provided by (used in) operating activities | $ 13,619,000 | $ 2,592,000 | ||||
Cash equivalents, at carrying value | 17,400,000 | |||||
Restricted Cash | 250,000 | |||||
[custom:ChangeInFairValueOfInvestmentSecurities] | 240,000 | |||||
Allowance of accounts written off | $ 3,901,000 | 35,000 | ||||
Property, Plant and Equipment, Estimated Useful Lives | ranges of estimated asset lives: building and improvements - ten to thirty-nine years; machinery and equipment including lab equipment - three to seven years; computer equipment and software - three to five years; and furniture and fixtures - five years. | |||||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | $ 8,700,000 | |||||
Cash, FDIC Insured Amount | 1,000,000 | |||||
Cash, Uninsured Amount | 7,700,000 | |||||
[custom:BreakageRevenue] | 400,000 | |||||
Deferred Revenue | 2,939,000 | 331,000 | ||||
Deferred Revenue | 2,700,000 | |||||
Research and Development Expense | 520,000 | 633,000 | ||||
Goodwill | 5,709,000 | 901,000 | $ 901,000,000 | $ 4,446,000 | ||
Retained earnings | 2,642,000 | (3,631,000) | ||||
Revenue | 79,042,000 | 14,514,000 | ||||
Net income | 6,273,000 | (2,125,000) | ||||
Comprehensive income | 6,109,000 | (2,134,000) | ||||
Revision of Prior Period, Adjustment [Member] | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Deferred Revenue | 284,000 | |||||
Goodwill | 1,251,000 | |||||
Retained earnings | 967,000 | |||||
Revenue | 967,000 | |||||
Net income | 967,000 | |||||
Comprehensive income | 967,000 | |||||
Accounting Standards Update 2021-08 [Member] | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Deferred Revenue | 2,655,000 | |||||
Goodwill | 4,458,000 | |||||
Retained earnings | 1,675,000 | |||||
Revenue | 78,075,000 | |||||
Net income | 5,306,000 | |||||
Comprehensive income | 5,142,000 | |||||
Cooperative Incentive Promotion Costs [Member] | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Advertising Expense | $ 361,000 | $ 766,000 | ||||
Investment Shares [Member] | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Investment Owned, Balance, Shares | 1,260,619 | |||||
Investment Owned, at Fair Value | $ 315,000 | |||||
Share Price | $ 0.06 | |||||
Marketable Securities [Member] | Minimum [Member] | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Debt Instrument, Interest Rate During Period | 0.65% | |||||
Marketable Securities [Member] | Maximum [Member] | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Debt Instrument, Interest Rate During Period | 4.88% |
Schedule of Assets Acquired and
Schedule of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Oct. 23, 2021 | Aug. 10, 2021 | Dec. 31, 2020 | Oct. 23, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | ||||||
Short term investments | $ 1,800 | |||||
Accounts receivable | 222 | |||||
Inventory | 82 | |||||
Prepaid and other current assets | 379 | |||||
Definite-lived intangible asset | 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 | $ 5,709 | $ 901,000 | 4,446 | $ 901 | ||
Total consideration | $ 12,674 | |||||
CPM acquisition [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Definite-lived intangible asset | $ 1,307 | |||||
Total assets acquired | 1,599 | |||||
Deferred tax liability | (362) | |||||
Total liabilities assumed | (362) | |||||
Net identifiable assets acquired | 1,237 | |||||
Goodwill | 1,263 | |||||
Total consideration | 2,500 | |||||
Clinical lab material | 180 | |||||
Lab equipment | $ 112 |
Schedule of Assets Acquired a_2
Schedule of Assets Acquired and Liabilities Assumed (Details) (Parenthetical) - Nebula Acquisition [Member] $ in Millions | Aug. 10, 2021USD ($) |
Business Acquisition [Line Items] | |
Cash Acquired from Acquisition | $ 1.6 |
Escrow Deposit Disbursements Related to Property Acquisition | $ 0.3 |
Schedule of Intangible Assets A
Schedule of Intangible Assets Acquisition (Details) - USD ($) $ in Thousands | Aug. 10, 2021 | Dec. 31, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | |||
Gross carying value | $ 12,297 | $ 1,307 | |
Trade Names [Member] | |||
Business Acquisition [Line Items] | |||
Gross carying value | 5,550 | ||
Intellectual Property [Member] | |||
Business Acquisition [Line Items] | |||
Gross carying value | 4,260 | ||
Customer Relationships [Member] | |||
Business Acquisition [Line Items] | |||
Gross carying value | $ 1,180 | ||
Nebula Acquisition [Member] | |||
Business Acquisition [Line Items] | |||
Gross carying value | $ 10,990 | ||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | |||
Nebula Acquisition [Member] | Trade Names [Member] | |||
Business Acquisition [Line Items] | |||
Gross carying value | $ 5,550 | ||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 15 years | ||
Nebula Acquisition [Member] | Intellectual Property [Member] | |||
Business Acquisition [Line Items] | |||
Gross carying value | $ 4,260 | ||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 5 years | ||
Nebula Acquisition [Member] | Customer Relationships [Member] | |||
Business Acquisition [Line Items] | |||
Gross carying value | $ 1,180 | ||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 1 year |
Schedule of Pro-forma Results (
Schedule of Pro-forma Results (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Business Combination and Asset Acquisition [Abstract] | ||
Revenue, net | $ 81,164 | $ 15,560 |
Net loss | $ 6,135 | $ (3,682) |
Business Acquisitions (Details
Business Acquisitions (Details Narrative) | Aug. 10, 2021USD ($)$ / shares | Aug. 10, 2021USD ($)$ / sharesshares | Oct. 23, 2020USD ($)ft² | Dec. 31, 2021USD ($)$ / shares | Dec. 31, 2020USD ($)$ / shares | Oct. 23, 2021USD ($) | Dec. 31, 2019USD ($) |
Business Acquisition [Line Items] | |||||||
Payments for Repurchase of Common Stock | $ 917,000 | ||||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ / shares | $ 7.29 | $ 4.58 | |||||
Amortization of Intangible Assets | $ 1,372,000 | $ 73,000 | |||||
Goodwill | $ 4,446,000 | $ 4,446,000 | 5,709,000 | 901,000 | $ 901,000,000 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | 13,473,000 | 13,473,000 | |||||
Amortization | 436,000 | $ 73,000 | |||||
CLIA License [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | $ 1,300,000 | ||||||
Nebula Acquisition [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Business Combination, Consideration Transferred, Equity Interests Issued and Issuable | 3,600,000 | ||||||
Business Combination, Consideration Transferred | 12,700,000 | ||||||
Cash Acquired from Acquisition | 1,600,000 | ||||||
Escrow Deposit Disbursements Related to Property Acquisition | $ 300,000 | ||||||
Amortization of Intangible Assets | $ 936,000 | ||||||
Nebula Acquisition [Member] | Mr. Kamal Obbad [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | shares | 250,000 | ||||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ / shares | $ 7.67 | ||||||
Nebula Acquisition [Member] | Nebula Stock Purchase Agreement [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Payments for Repurchase of Common Stock | $ 14,600,000 | ||||||
Shares Issued, Price Per Share | $ / shares | $ 7.46 | $ 7.46 | |||||
Nebula Acquisition [Member] | Nebula Stock Purchase Agreement [Member] | CitiBankm, N.A. [Member] | |||||||
Business Acquisition [Line Items] | |||||||
[custom:PurchasePriceOfEscrowAmount] | $ 1,080,000 | ||||||
[custom:EscrowMaturityDate] | Feb. 23, 2023 | ||||||
Plaza Medical Laboratory Corp [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Business Combination, Consideration Transferred | $ 2,500,000 | ||||||
Area of Land | ft² | 4,000 | ||||||
CPM acquisition [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Business Combination, Consideration Transferred | $ 2,500,000 | ||||||
Goodwill | 1,263,000 | ||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | $ 1,599,000 |
Schedule of Changes In Goodwill
Schedule of Changes In Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill, beginning of Fiscal 2021 | $ 901 | |
Acquisition of CPM | 901 | |
Adjustment for deferred tax liability | 362 | |
Acquisition of Nebula | 4,446 | |
Goodwill, end of Fiscal 2021 | $ 5,709 | $ 901 |
Schedule of Intangible Assets (
Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, gross | $ 12,297 | $ 1,307 |
Less: accumulated amortization | (1,445) | (73) |
Total intangible assets, net | 10,852 | 1,234 |
Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, gross | $ 5,550 | |
Finite-Lived Intangible Asset, Useful Life | 15 years | |
Intellectual Property [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, gross | $ 4,260 | |
Finite-Lived Intangible Asset, Useful Life | 5 years | |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, gross | $ 1,180 | |
Finite-Lived Intangible Asset, Useful Life | 1 year | |
License [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, gross | $ 1,307 | $ 1,307 |
Finite-Lived Intangible Asset, Useful Life | 3 years |
Schedule Estimated Future Amort
Schedule Estimated Future Amortization Expense of Acquired Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Year ended December 31, 2022 | $ 2,378 | |
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 | |
Thereafter | 3,555 | |
Total intangible assets, net | $ 10,852 | $ 1,234 |
Goodwill and Acquired Intangi_3
Goodwill and Acquired Intangible Assets (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization of Intangible Assets | $ 1,372,000 | $ 73,000 |
Schedule of Property, Plant and
Schedule of Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 12,830 | $ 8,599 |
Less: accumulated depreciation | (6,883) | (5,021) |
Total property, plant and equipment, net | 5,947 | 3,578 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 352 | 352 |
Building Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 1,729 | 1,729 |
Building Improvements [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 10 years | |
Building Improvements [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 39 years | |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 4,740 | 4,441 |
Machinery and Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | |
Machinery and Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 7 years | |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 4,330 | 1,002 |
Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | |
Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 7 years | |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 1,211 | 881 |
Computer Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | |
Computer Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 468 | $ 194 |
Property, Plant and Equipment, Useful Life | 5 years |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details Narrative) - USD ($) | Nov. 13, 2020 | Jul. 10, 2020 | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||
Depreciation | $ 1,862,000 | $ 375,000 | ||
Payments to Acquire Productive Assets | $ 4,231,000 | 1,689,000 | ||
Proceeds from Sale of Property Held-for-sale | $ 2,200,000 | |||
[custom:ClosingCostAndOtherExpenses] | $ 134,000 | |||
Sale Agreement [Member] | ||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||
Gain (Loss) on Disposition of Property Plant Equipment, Excluding Oil and Gas Property and Timber Property | $ 1,900,000 | |||
Lenape valley foundation [Member] | ||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||
Payments to Acquire Productive Assets | $ 2,200,000 |
Unsecured Convertible Promiss_2
Unsecured Convertible Promissory Notes Payable (Details Narrative) - USD ($) | Sep. 15, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Oct. 22, 2020 |
Short-term Debt [Line Items] | ||||
Debt Instrument, Face Amount | $ 300,000 | |||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | |||
September 2020 Notes [Member] | Unsecured Debt [Member] | ||||
Short-term Debt [Line Items] | ||||
Debt Instrument, Maturity Date | Sep. 15, 2020 | |||
Debt Instrument, Face Amount | $ 10,000,000 | |||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | |||
Debt Conversion, Description | We have the right to prepay the September 2020 Notes at any time after the 13-month anniversary of the closing date after providing written notice to the Lenders and may prepay the September 2020 Notes prior to such time with the consent of the Lenders. The Lenders have the right, at any time, and from time to time, on and after the 13-month anniversary of the closing date to convert up to an aggregate | |||
Convertible Debt | $ 3,000,000 | |||
Debt Instrument, Convertible, Conversion Price | $ 3 | |||
Interest Expense, Other | $ 1,000,000 | $ 295,000 |
Schedule of Stock Options Activ
Schedule of Stock Options Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Offsetting Assets [Line Items] | ||
Weighted Average Exercise Price, Granted | $ 7.29 | $ 4.58 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | 3 years | |
Number of Shares Options Outstanding - Ending | 5,085,000 | |
Equity Option [Member] | ||
Offsetting Assets [Line Items] | ||
Number of Shares Options Outstanding - Beginning | 3,795,000 | 3,082,000 |
Weighted Average Exercise Price Options Outstanding - Beginning | $ 2.21 | $ 1.67 |
[custom:SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm1] | 3 years 8 months 12 days | |
Total Intrinsic Value - Beginning | $ 26,441 | $ 1,085 |
Number of Shares, Granted | 1,825,000 | 713,000 |
Weighted Average Exercise Price, Granted | $ 7.29 | $ 4.58 |
[custom:SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsGrantedWeightedAverageRemainingContractualTerm] | 6 years 2 months 12 days | 7 years |
Total Intrinsic Value - Granted | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | 3 years 4 months 24 days | |
Number of Shares, Forfeited | (505,000) | |
Weighted Average Exercise Price, Forfeited | $ 8.50 | |
Total Intrinsic Value - Forfeited | ||
Number of Shares, Expired | (5,000) | |
Weighted Average Exercise Price, Expired | $ 1.39 | |
Number of Shares Options Outstanding - Ending | 5,110,000 | 3,795,000 |
Weighted Average Exercise Price Options Outstanding - Ending | $ 3.27 | $ 2.21 |
Total Intrinsic Value - Ending | $ 20,820 | $ 26,441 |
Number of Shares Options Vested and Exercisable | 3,994,000 | |
Weighted Average Exercise Price, Options Vested and Exercisable | $ 2.51 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Weighted Average Remaining Contractual Term | 2 years 7 months 6 days | |
Total Intrinsic Value, Options Vested and Exercisable | $ 19,218 |
Summary of Weighted Average Ass
Summary of Weighted Average Assumptions Used in Determining Fair Value of Options (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Equity [Abstract] | ||
Exercise price | $ 7.29 | $ 4.58 |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term | 4 years | 4 years 2 months 12 days |
Expected stock price volatility | 79.00% | 52.00% |
Risk-free rate of interest | 80.00% | 0.00% |
Expected dividend yield (per share) | 0.00% | 0.00% |
Schedule of Warrant Activity (D
Schedule of Warrant Activity (Details) - Warrant [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Number of Shares Warrants Outstanding - Beginning | 450,000 | |
Weighted Average Exercise Price Warrants Outstanding - Beginning | $ 3.22 | |
[custom:SharebasedCompensationArrangementBySharebasedPaymentAwardNonOptionsOutstandingWeightedAverageRemainingContractualTerm1] | 2 years 8 months 12 days | |
Warrants granted | 455,000 | 450,000 |
Weighted Average Exercise Price, Warrants Granted | $ 12.83 | $ 3.22 |
[custom:SharebasedCompensationArrangementBySharebasedPaymentAwardNonOptionsGrantedWeightedAverageRemainingContractualTerm] | 3 years | 3 years |
Weighted Average Exercise Price, Cashless Exercise | (50,000) | |
Weighted Average Exercise Price Warrants Outstanding - Cashless Exerisce | $ 5 | |
Number of Shares Warrants Outstanding - Ending | 855,000 | 450,000 |
Weighted Average Exercise Price Warrants Outstanding - Ending | $ 8.23 | $ 3.22 |
[custom:SharebasedCompensationArrangementBySharebasedPaymentAwardNonOptionsOutstandingWeightedAverageRemainingContractualTerm2] | 1 year 10 months 24 days | |
Number of Shares Warrants Vested and Exercisable | 855,000 | |
Weighted Average Exercise Price, Warrants Vested and Exercisable | $ 8.23 | |
[custom:SharebasedCompensationArrangementBySharebasedPaymentAwardNonOptionsVestedAndExercisableWeightedAverageRemainingContractualTerm2] | 1 year 10 months 24 days |
Summary of Weighted Average A_2
Summary of Weighted Average Assumptions Used in Determining Fair Value of Warrants (Details) - Warrant [Member] | Dec. 31, 2021 | Dec. 31, 2020 |
Measurement Input, Exercise Price [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Warrants outstanding, measurement input, percentage | 12.83 | 3.22 |
Measurement Input, Expected Term [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Warrants and Rights Outstanding, Term | 3 years | 2 years |
Measurement Input, Price Volatility [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Warrants outstanding, measurement input, percentage | 81 | 58 |
Measurement Input, Risk Free Interest Rate [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Warrants outstanding, measurement input, percentage | 0.2 | 0 |
Measurement Input, Expected Dividend Rate [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Warrants outstanding, measurement input, percentage | 0 | 0 |
Stockholders_ Equity (Details N
Stockholders’ Equity (Details Narrative) | Dec. 28, 2021USD ($)$ / shares | Aug. 10, 2021$ / sharesshares | Jun. 03, 2021USD ($)$ / shares | May 20, 2021shares | May 13, 2021$ / shares | Jan. 21, 2021USD ($) | Jan. 18, 2021$ / sharesshares | Jan. 05, 2021USD ($)$ / sharesshares | Dec. 12, 2019$ / shares | Jan. 24, 2019$ / shares | Sep. 05, 2018$ / shares | Apr. 12, 2018shares | Dec. 31, 2021USD ($)$ / sharesshares | Dec. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2021USD ($)$ / sharesshares | Dec. 07, 2021USD ($) | Sep. 08, 2021USD ($) |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Common Stock, Shares Authorized | 50,000,000 | 50,000,000 | 50,000,000 | ||||||||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.0005 | $ 0.0005 | $ 0.0005 | ||||||||||||||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 | 1,000,000 | ||||||||||||||
Preferred Stock, Par or Stated Value Per Share | $ / shares | $ 0.0005 | $ 0.0005 | $ 0.0005 | ||||||||||||||
Preferred Stock, Shares Issued | 0 | 0 | 0 | ||||||||||||||
Common Stock, Dividends, Per Share, Cash Paid | $ / shares | $ 0.30 | ||||||||||||||||
Proceeds from Issuance Initial Public Offering | $ | $ 35,135,000 | ||||||||||||||||
Accounts Payable, Current | $ | 7,026,000 | $ 3,771,000 | $ 7,026,000 | ||||||||||||||
Stock Repurchased During Period, Value | $ | $ 917,000 | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 5,085,000 | 5,085,000 | |||||||||||||||
Common Stock, Capital Shares Reserved for Future Issuance | 275,785 | 275,785 | |||||||||||||||
Share-based Payment Arrangement, Expense | $ | $ 3,219,000 | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | 3 years | ||||||||||||||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ / shares | $ 7.29 | $ 4.58 | |||||||||||||||
2020 Directors Equity Compensation Plan [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 775,000 | ||||||||||||||||
2010 Director's Equity Compensation Plan [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 200,000 | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 425,126 | 425,126 | |||||||||||||||
Common Stock, Capital Shares Reserved for Future Issuance | 0 | 0 | |||||||||||||||
Amended 2010 Plan [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Stock Issued During Period, Shares, New Issues | 4,900,000 | ||||||||||||||||
Two Thousand Ten Equity Compensation Plan [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 510,000 | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 2,034,874 | 2,034,874 | |||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 275,785 | 275,785 | |||||||||||||||
Share-based Payment Arrangement, Expense | $ | $ 1,895,820 | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | 5 years 10 months 24 days | ||||||||||||||||
Two Thousand Ten Equity Compensation Plan [Member] | Employees and Non-Employees [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 1,249,874 | 513,000 | |||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 25.00% | ||||||||||||||||
Two Thousand Ten Equity Compensation Plan [Member] | Employees and Non-Employees [Member] | 3-Year Period [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 75.00% | ||||||||||||||||
2018 Stock Incentive Plan [Member] | Chief Executive Officer [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 2,300,000 | ||||||||||||||||
Stock Issued During Period, Shares, Employee Stock Ownership Plan | 2,300,000 | ||||||||||||||||
Two Thousand Eighteen Stock [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Payment Arrangement, Expense | $ | $ 2,900,000 | $ 1,200,000 | |||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | $ | $ 6,100,000 | $ 1,400,000 | |||||||||||||||
Share Repurchase Program [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ | $ 6,000,000 | ||||||||||||||||
Stock Repurchased During Period, Shares | 166,824 | ||||||||||||||||
Stock Repurchased During Period, Value | $ | $ 944,000 | ||||||||||||||||
Nebula Acquisition [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Stock Issued During Period, Shares, New Issues | 483,685 | ||||||||||||||||
Business Acquisition, Share Price | $ / shares | $ 7.46 | $ 7.46 | |||||||||||||||
Stock Issued During Period, Value, New Issues | $ | $ 3,600,000 | ||||||||||||||||
Nebula Acquisition [Member] | Mr. Kamal Obbad [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 250,000 | ||||||||||||||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ / shares | $ 7.67 | ||||||||||||||||
Inducement Option Award [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Business Acquisition, Share Price | $ / shares | $ 7.67 | 7.67 | |||||||||||||||
Share-based Payment Arrangement, Plan Modification, Incremental Cost | $ | $ 1,128,000 | ||||||||||||||||
Maximum [Member] | Two Thousand Ten Equity Compensation Plan [Member] | Employees and Non-Employees [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Payment Arrangement, Option, Exercise Price Range, Upper Range Limit | $ / shares | $ 11.03 | $ 8.82 | |||||||||||||||
Minimum [Member] | Two Thousand Ten Equity Compensation Plan [Member] | Employees and Non-Employees [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Payment Arrangement, Option, Exercise Price Range, Upper Range Limit | $ / shares | $ 5.28 | $ 2.64 | |||||||||||||||
Registered Direct Offering [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Stock Issued During Period, Shares, New Issues | 550,000 | ||||||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 275,000 | ||||||||||||||||
Shares Issued, Price Per Share | $ / shares | $ 10 | ||||||||||||||||
Proceeds from Issuance of Warrants | $ | $ 5,500,000 | ||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 11 | ||||||||||||||||
IPO [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Stock Issued During Period, Shares, New Issues | 3,000,000 | ||||||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 180,000 | ||||||||||||||||
Shares Issued, Price Per Share | $ / shares | $ 12.50 | ||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 15.625 | ||||||||||||||||
Proceeds from Issuance Initial Public Offering | $ | $ 35,100,000 | ||||||||||||||||
At the Market Offering [Member] | Sales agreement [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.0005 | ||||||||||||||||
[custom:OfferingCost] | $ | $ 100,000,000 | ||||||||||||||||
[custom:CommissionRateFromGrossProceedsOfSales-0] | 0.020 | ||||||||||||||||
Accounts Payable, Current | $ | $ 60,000 | $ 25,000 | |||||||||||||||
Legal Fees | $ | 50,000 | ||||||||||||||||
At the Market Offering [Member] | Sales agreement [Member] | Maximum [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
[custom:OfferingCost] | $ | $ 3,000 | ||||||||||||||||
CEO Options [Member] | Two Thousand Eighteen Stock [Member] | Stock Holders [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Common Stock, Dividends, Per Share, Cash Paid | $ / shares | $ 0.30 | $ 0.25 | $ 0.25 | $ 1 | |||||||||||||
CEO Options [Member] | Maximum [Member] | 2018 Stock Incentive Plan [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Payment Arrangement, Option, Exercise Price Range, Upper Range Limit | $ / shares | 3 | ||||||||||||||||
CEO Options [Member] | Maximum [Member] | Two Thousand Eighteen Stock [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Payment Arrangement, Option, Exercise Price Range, Upper Range Limit | $ / shares | 1.50 | 1.75 | 2 | ||||||||||||||
CEO Options [Member] | Minimum [Member] | Two Thousand Eighteen Stock [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Payment Arrangement, Option, Exercise Price Range, Upper Range Limit | $ / shares | $ 1.20 | $ 1.50 | $ 1.75 | $ 2 | |||||||||||||
Inducement Option Award [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 100,000 | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 25.00% | ||||||||||||||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ / shares | $ 5.76 | ||||||||||||||||
Inducement Option Award [Member] | Mr. Kamal Obbad [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Accelerated Vesting, Number | 250,000 | ||||||||||||||||
Common Stock [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Payments of Ordinary Dividends, Common Stock | $ | $ 4,500,000 | ||||||||||||||||
Stock Repurchased During Period, Shares | 166,824 | ||||||||||||||||
Stock Repurchased During Period, Value | $ | |||||||||||||||||
Common Stock [Member] | Two Thousand Ten Directors Plan [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Shares Issued, Price Per Share | $ / shares | $ 5.28 | $ 5.28 | |||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 225,126 | ||||||||||||||||
Warrant [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 5,986 | 5,986 | |||||||||||||||
Share-based Payment Arrangement, Expense | $ | $ 253,000 | $ 178,000 | |||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Exercised | 50,000 | ||||||||||||||||
Class of Warrant or Right, Outstanding | 855,000 | 855,000 | |||||||||||||||
Warrant [Member] | Consultants [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 450,000 | ||||||||||||||||
Warrants and Rights Outstanding, Term | 3 years | ||||||||||||||||
Warrant [Member] | Maximum [Member] | Consultants [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 5 | ||||||||||||||||
Warrant [Member] | Minimum [Member] | Consultants [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 3 | ||||||||||||||||
Warrant [Member] | Registered Direct Offering [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 275,000 | 275,000 | |||||||||||||||
Warrant [Member] | IPO [Member] | |||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 180,000 | 180,000 |
Defined Contribution Plans (Det
Defined Contribution Plans (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Retirement Benefits [Abstract] | ||
Defined Contribution Plan, Employer Discretionary Contribution Amount | $ 112,000 | $ 71,000 |
Schedule of Components of Incom
Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Federal | ||
State | 1,318 | 12 |
Current Total | 1,318 | 12 |
Federal | (1,511) | |
State | (775) | |
Deferred Total | (2,286) | |
Income taxes from continuing operations | $ (968) | $ 12 |
Schedule of Effective Income Ta
Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Statutory Rate - federal | $ 1,232 | $ (377) |
State taxes, net of federal benefit | 366 | (31) |
Permanent differences and other | 227 | 159 |
Income taxes from continuing operations before valuation allowance | 1,825 | (249) |
Change in valuation allowance | (2,793) | 261 |
Income taxes from continuing operations | (968) | 12 |
Total | $ (968) | $ 12 |
Schedule of Deferred Tax Assets
Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Income Tax Disclosure [Abstract] | ||
Net operating loss and capital loss carryforward | $ 3,584 | $ 5,020 |
Right of use asset | 1,348 | 1,086 |
Other | 2,531 | 370 |
Capital lease obligations | (1,348) | (1,086) |
Depreciation | (948) | (419) |
Amortization | (2,989) | |
Valuation allowance | (2,178) | (4,971) |
Total |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2018 | |
Operating Loss Carryforwards [Line Items] | |||
Deferred Tax Assets, Valuation Allowance | $ 2,178 | $ 4,971 | |
[custom:PercentageForUtilizationOfTaxableIncome] | 80.00% | ||
Tax Credit Carryforward, Amount | $ 900 | ||
[custom:TaxCreditCarryforwardLimitationAmount-0] | 300 | ||
[custom:TaxCreditCarryforwardRemainingAmount-0] | 1,400 | ||
State and Local Jurisdiction [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Deferred Tax Assets, Operating Loss Carryforwards | $ 1,140 | ||
[custom:OperatingLossCarryForwardsExpirationDatesDescription] | expire in 2024 | ||
Domestic Tax Authority [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Deferred Tax Assets, Operating Loss Carryforwards | $ 2,420 | $ 2,300 | |
Tax cuts and jobs act [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Deferred Tax Assets, Operating Loss Carryforwards | $ 100 | ||
[custom:OperatingLossCarryForwardsExpirationDatesDescription] | 20 years and begins to expire in 2026 |
Schedule of Other Current Liabi
Schedule of Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Other Liabilities Disclosure [Abstract] | ||
Accrued diagnostic services commissions | $ 1,283 | $ 461 |
Accrued payroll | 514 | 464 |
Accrued expenses | 300 | 304 |
Accrued returns | 338 | 291 |
Accrued income tax payable | 1,312 | 8 |
Accrued benefits and vacation | 60 | 34 |
Total other current liabilities | $ 3,807 | $ 1,562 |
Schedule of Estimated Future Mi
Schedule of Estimated Future Minimum Obligations (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2022 | $ 675 |
2023 | 675 |
2024 | 675 |
2025 | 675 |
2026 | 675 |
Total | $ 3,375 |
Commitments and Contingencies_2
Commitments and Contingencies (Details Narrative) - USD ($) | May 07, 2020 | Dec. 31, 2021 | Dec. 31, 2020 |
Commitments and Contingencies Disclosure [Abstract] | |||
Disposal Group, Including Discontinued Operation, Revenue | $ 201,000 | ||
Escrow Deposit | $ 5,000,000 | ||
[custom:ClaimAgainstEscrowAmount] | $ 4,800,000 | ||
Agreement termination date | Mar. 29, 2022 |
Summary of Quantitative Informa
Summary of Quantitative Information About Operating Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Leases | ||
Operating lease cost | $ 816 | $ 11 |
Variable lease cost | 1 | |
Operating lease expense | 816 | 12 |
Total rent expense | 816 | 12 |
Operating cash flows used in operating leases | (357) | (11) |
Right-of-use assets obtained in exchange for operating lease liabilities | $ 4,740 | |
Operating Lease, Weighted Average Remaining Lease Term | 9 years 4 months 24 days | 10 years 3 months 18 days |
Operating Lease, Weighted Average Discount Rate, Percent | 10.00% | 10.00% |
Schedule of Maturity of Operati
Schedule of Maturity of Operating Leases (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Leases | |
Year Ended December 31, 2022 | $ 774 |
Year Ended December 31, 2023 | 738 |
Year Ended December 31, 2024 | 747 |
Year Ended December 31, 2025 | 768 |
Year Ended December 31, 2026 | 783 |
Thereafter | 3,876 |
Total | 7,686 |
Less present value discount | (2,825) |
Operating lease liabilities | $ 4,861 |
Leases (Details Narrative)
Leases (Details Narrative) | Dec. 08, 2020USD ($) | Oct. 23, 2020USD ($)ft² | Oct. 23, 2020ft² | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) |
Operating Lease, Payments | $ 357,000 | $ 11,000 | |||
Operating Lease, Liability | 4,861,000 | ||||
Operating Lease, Right-of-Use Asset | 4,402,000 | $ 4,731,000 | |||
Operating Lease Liabilities [Member] | |||||
Operating Lease, Liability | 4,900,000 | ||||
Operating Lease Right Of Use Asset [Member] | |||||
Operating Lease, Right-of-Use Asset | $ 4,400,000 | ||||
Plaza Medical Laboratory Corp [Member] | |||||
Area of Land | ft² | 4,000 | 4,000 | |||
Confucius Labs [Member] | Old Bridge New Jersey [Member] | |||||
Operating Lease, Payments | $ 56,963 | $ 5,950 | |||
Lessor, Operating Lease, Term of Contract | 10 years | 10 years | |||
Lessee, Operating Lease, Description | For the first year of the NY Lease, we will pay a base rent of $56,963 | We have the option to terminate the NY Lease on the sixth anniversary of the Commencement Date, provided that we give 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 | We also have 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. We also have a right of first offer to purchase the Building during the term of the NY Lease | ||
Gradual rental rate increase percentage | 2.75% | ||||
Confucius Labs [Member] | Old Bridge New Jersey [Member] | Final Months [Member] | |||||
Operating Lease, Payments | $ 74,716 |
Consulting Agreement and Secu_2
Consulting Agreement and Secured Promissory Note Receivable (Details Narrative) - USD ($) | Jan. 14, 2021 | Sep. 25, 2020 | Feb. 28, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 25, 2021 | Oct. 22, 2020 | Jul. 29, 2020 | Jul. 21, 2020 |
Debt Instrument, Face Amount | $ 300,000 | ||||||||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | ||||||||
Interest and Fee Income, Loans and Leases | $ 642,000 | $ 62,000 | |||||||
Secured Debt | 0 | ||||||||
Accounts Receivable, Credit Loss Expense (Reversal) | 3,866,000 | $ 97,000 | |||||||
General and Administrative Expense [Member] | |||||||||
Accounts Receivable, Credit Loss Expense (Reversal) | $ 3,750,000 | ||||||||
Investment Shares [Member] | |||||||||
Investment Owned, Balance, Shares | 1,260,619 | ||||||||
Investment Owned, at Fair Value | $ 315,000 | ||||||||
Consulting Agreement [Member] | |||||||||
Business Combination, Acquisition Related Costs | $ 250,000 | ||||||||
Termination Agreement [Member] | |||||||||
Test fees received | $ 95,000 | ||||||||
Unrelated Third party [Member] | Minimum [Member] | |||||||||
Debt Instrument, Face Amount | 2,750,000 | ||||||||
Unrelated Third party [Member] | Maximum [Member] | |||||||||
Debt Instrument, Face Amount | $ 3,750,000 | ||||||||
Unrelated Third party [Member] | Secured Debt [Member] | |||||||||
Debt Instrument, Face Amount | $ 1,000,000 | ||||||||
Unrelated Third party [Member] | Revision of Prior Period, Adjustment [Member] | Secured Debt [Member] | |||||||||
Debt Instrument, Face Amount | $ 3,000,000 | $ 250,000 | $ 750,000 | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 15.00% | ||||||||
Debt Instrument, Term | 36 months |
Significant Customers (Details
Significant Customers (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Concentration Risk [Line Items] | ||
Revenues, net | $ 79,042 | $ 14,514 |
Revenue Benchmark [Member] | Diagnostic Services Clients One [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 23.50% | |
Revenue Benchmark [Member] | Diagnostic Services Clients Two [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 17.90% | |
Revenue Benchmark [Member] | Diagnostic Services Clients Three [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 11.90% | |
Revenue Benchmark [Member] | Third Party Contract Manufacturing Customer One [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 47.10% | |
Revenue Benchmark [Member] | Third Party Contract Manufacturing Customer Two [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 17.20% | |
Revenue Benchmark [Member] | Government Agencies [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 60.00% | |
Revenue Benchmark [Member] | Insurance Providers [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 35.00% | |
Revenue Benchmark [Member] | Client Payers [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 5.00% | |
Trade Receivable [Member] | Diagnostic Services Clients One [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 43.00% | |
Trade Receivable [Member] | Diagnostic Services Clients Two [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 11.60% | |
Trade Receivable [Member] | Diagnostic Services Clients Three [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 10.70% | |
Trade Receivable [Member] | Diagnostic Services Clients Four [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 10.70% | |
Trade Receivable [Member] | Customer One [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 36.00% | |
Trade Receivable [Member] | Customer Two [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 20.00% | |
Trade Receivable [Member] | Customer Three [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 13.00% |
Schedule of Segment Information
Schedule of Segment Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Segment Reporting Information [Line Items] | ||
Revenues, net | $ 79,042 | $ 14,514 |
Consolidated cost of revenue | 37,054 | 9,908 |
Total Depreciation and amortization expense | 1,983 | 126 |
Operating and other expenses | 34,700 | 6,818 |
Total income (loss) from continuing operations, after income taxes | 6,273 | (2,326) |
Total income (loss) from continuing operations, before income taxes | 5,305 | (2,314) |
Income tax benefit (expense) | 968 | (12) |
Income from discontinued operations, before income taxes | 201 | |
Net income (loss) | 6,273 | (2,125) |
Total assets | 89,295 | 31,405 |
Diagnostic Services [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues, net | 68,559 | 1,277 |
Consolidated cost of revenue | 29,415 | 644 |
Total Depreciation and amortization expense | 1,976 | 37 |
Total income (loss) from continuing operations, after income taxes | 18,197 | (270) |
Total assets | 51,150 | 13,410 |
Consumer Products [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues, net | 10,483 | 13,237 |
Consolidated cost of revenue | 7,639 | 9,264 |
Total Depreciation and amortization expense | 7 | 89 |
Total income (loss) from continuing operations, after income taxes | (1,714) | 1,962 |
Total assets | 24,139 | 6,261 |
Unallocated Corporate [Member] | ||
Segment Reporting Information [Line Items] | ||
Total income (loss) from continuing operations, after income taxes | (11,178) | (4,006) |
Total assets | $ 14,006 | $ 11,734 |
Segment Information (Details Na
Segment Information (Details Narrative) | 12 Months Ended |
Dec. 31, 2021Segment | |
Segment Reporting [Abstract] | |
Number of Operating Segments | 2 |
Schedule of Basic and Diluted N
Schedule of Basic and Diluted Net Loss Per Share (Details) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Earnings Per Share [Abstract] | ||
Net income (loss) - basic | $ 6,273 | $ (2,125) |
Interest on unsecured convertible promissory note | 1,000 | |
Net income (loss) - diluted | $ 7,273 | $ (2,125) |
Weighted average shares outstanding - basic | 15,172 | 11,595 |
Diluted shares- Stock Options | 2,001 | |
Diluted shares- Stock Warrants | 220 | |
Unsecured convertible promissory note | 1,000 | |
Weighted average shares outstanding - diluted | 18,393 | 11,595 |
Schedule of Anti-dilutive Secur
Schedule of Anti-dilutive Securities Excluded from the Income Per Share Computation (Details) - shares shares in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities | 1,283 | 5,245 |
Common Stock Purchase Warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities | 455 | 450 |
Share-based Payment Arrangement, Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities | 828 | 3,795 |
Convertible Debt Securities [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities | 1,000 |
Related Parties (Details Narrat
Related Parties (Details Narrative) - Jason Karkus [Member] | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | |
Annual base salary | $ 204,000 |
Bonus | 850,000 |
Stock option received | $ 468,000 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Mar. 15, 2022 | Feb. 28, 2022 | Feb. 28, 2022 | Feb. 14, 2022 | May 13, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Oct. 22, 2020 |
Subsequent Event [Line Items] | ||||||||
Common Stock, Dividends, Per Share, Cash Paid | $ 0.30 | |||||||
Debt Instrument, Face Amount | $ 300,000 | |||||||
Revenue | $ 79,042,000 | $ 14,514,000 | ||||||
Letter Agreement [Member] | Holder [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Debt Instrument, Face Amount | $ 2,000,000 | $ 2,000,000 | ||||||
Subsequent Event [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Common Stock, Dividends, Per Share, Cash Paid | $ 0.30 | |||||||
Payments of Ordinary Dividends, Common Stock | $ 4,600,000 | |||||||
Subsequent Event [Member] | Diagnostic Services Revenue [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Revenue | $ 42,000,000 | |||||||
Subsequent Event [Member] | Diagnostic Services Revenue [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Concentration Risk, Percentage | 57.60% | |||||||
Subsequent Event [Member] | Letter Agreement [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Debt repurchase of convertible conversion price | $ 5.75 | $ 5.75 | ||||||
Debt Instrument, Repurchase Amount | $ 1,150,000 | $ 1,150,000 | ||||||
Subsequent Event [Member] | Letter Agreement [Member] | Holder [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Debt Conversion, Converted Instrument, Amount | $ 600,000 | |||||||
Debt Conversion, Converted Instrument, Shares Issued | 200,000 | |||||||
Debt Instrument, Convertible, Conversion Price | $ 3 | $ 3 | ||||||
Repayments of Unsecured Debt | $ 1,440,548 | |||||||
Debt Instrument, Periodic Payment, Principal | $ 1,400,000 | |||||||
Debt Instrument, Periodic Payment, Interest | 40,548 | |||||||
Debt Instrument, Repurchase Amount | $ 2,590,548 | $ 2,590,548 |