8-K
Insight Molecular Diagnostics Inc. (IMDX)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): August 8, 2022
OncocyteCorporation
(Exact name of registrant as specified in its charter)
| California | 1-37648 | 27-1041563 |
|---|---|---|
| (State<br> or other jurisdiction | (Commission | (IRS<br> Employer |
| of<br> incorporation) | File<br> Number) | Identification<br> No.) |
15Cushing
Irvine,California 92618
(Address of principal executive offices)
(949)409-7600
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Exchange Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered |
|---|---|---|
| Common<br> Stock, no par value | OCX | The<br> Nasdaq Stock Market LLC |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written<br> communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting<br> material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement<br> communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement<br> communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item2.02 Results of Operations and Financial Condition.
On August 10, 2022, Oncocyte Corporation (“we,” “us,” “our,” the “Company” or “Oncocyte”) issued a press release announcing its financial results for the three and six months ended June 30, 2022. A copy of the press release is attached as Exhibit 99.1, which, in its entirety, is incorporated herein by reference.
The information in this Item 2.02 of this Current Report on Form 8-K (the “Form 8-K”), including Exhibit 99.1 hereto, is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section. Such information shall not be deemed incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, regardless of any general incorporation language in such filing, except as otherwise expressly set forth by specific reference in such filing.
Item2.05 Costs Associated with Exit or Disposal Activities.
On August 10, 2022, Oncocyte announced plans to strategically realign its operations and implement cost reduction programs to prioritize near term revenue generators and to manage and preserve cash. As part of this strategic realignment, the Company announced a reduction in force involving full-time employees (the “Reduction”), which Oncocyte expects will decrease its annual cash compensation costs by over $4.5 million, exclusive of related employee severance and benefit costs (as described further below). The Reduction began on August 8, 2022 and is expected to be completed by September 30, 2022.
In connection with the Reduction, we estimate that we will incur charges of approximately $2.0 million related to employee severance and benefits costs in the third quarter of 2022.
CautionaryNote Regarding Forward-Looking Statements
This Form 8-K contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and other federal securities laws. Any statements contained herein that do not describe historical facts, including, but not limited to, statements regarding our estimates and expectations in connection with the Reduction, are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those discussed in such forward-looking statements. Such risks and uncertainties include, among others, the risks identified in the Company’s filings with the Securities and Exchange (the “SEC”), including its Quarterly Report on Form 10-Q for the quarter ended March 31, 2022, filed with the SEC on May 12, 2022, as well as our other filings with the SEC. Any of these risks and uncertainties could materially and adversely affect the Company’s results of operations, which would, in turn, have a significant and adverse impact on the Company’s stock price. The Company cautions you not to place undue reliance on any forward-looking statements, which speak only as of the date they are made. The Company undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date they were made or to reflect the occurrence of unanticipated events.
Item5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements ofCertain Officers.
Effective August 8, 2022, the Board of Directors of the Company appointed Gisela Paulsen to the position of President and Chief Operating Officer and Anish John to the position of Chief Financial Officer. The compensation of Ms. Paulsen and Mr. John was previously disclosed in a Form 8-K filed with the SEC on August 3, 2022.
Gisela Paulsen, 56, previously served as our Chief Operating Officer since October 2021. Prior to joining Oncocyte, Ms. Paulsen was the General Manager, Precision Oncology of Exact Sciences Corporation, a molecular diagnostics company specializing in the detection of early stage cancers, from April 2020 to April 2021. Prior to joining Exact Sciences, Ms. Paulsen served in various management roles at F. Hoffmann-La Roche Ltd. (“Roche”), a multinational healthcare company, and Genentech, Inc. (“Genentech”), a biotechnology company which became a subsidiary of Roche, since November 2005. She served as Roche and Genentech’s Senior Vice President, Global Head, Product Development, Clinical Operations from January 2018 to April 2020, as Roche and Genentech’s Vice President, Global Head, Product Development, Global Product Strategy & Late-Stage Portfolio Finance beginning from March 2017 to February 2018, and as Genentech’s Vice President, Access Solutions from September 2014 to February 2017. Ms. Paulsen received a B.S. in pharmacy and an M.S. in pharmaceutics and drug delivery from Uppsala University in Sweden.
Anish John, 52, previously served as our Senior Vice President, Finance, and interim Chief Financial Officer since June 2022. Prior to that, Mr. John previously served as our Vice President of Operations and Finance, Transplant Business Unit, since September 2021. He previously served as Senior Director, Financial Planning and Analysis for Foundation Medicine, Inc. (“Foundation Medicine”), a wholly owned subsidiary of Roche Holding, AG., from October 2019 to March 2021. Prior to joining Foundation Medicine, Mr. John served in the following various management roles at PerkinElmer, Inc.: Senior Director of Finance, Americas Diagnostics from August of 2017 to August of 2019, Director of Finance, Americas Diagnostics from September 2008 to July of 2017, and Senior Manager, Sales Operations and Finance North America from March of 2007 to August of 2008. Mr. John holds an M.B.A. from Babson College, in Wellesley Massachusetts and a B.B.A in Finance from the University of Massachusetts at Amherst.
There have been no transactions with Oncocyte and there are currently no proposed transactions with Oncocyte, in which the amount involved exceeds $120,000 and in which either Ms. Paulsen or Mr. John had or will have a direct or indirect material interest within the meaning of Item 404(a) of Regulation S-K, since the beginning of the Company’s last fiscal year through the present. No arrangement or understanding exists between either Ms. Paulsen or Mr. John and any other person pursuant to which either of them was selected as an officer of the Company. No “family relationship,” as that term is defined in Item 401(d) of Regulation S-K, exists between either Ms. Paulsen or Mr. John, on the one hand, and any of our directors or executive officers, on the other hand.
Item9.01 - Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit Number | Description |
|---|---|
| 99.1 | Press release, dated August 10, 2022. |
| 104 | Cover<br> Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ONCOCYTE CORPORATION | ||
|---|---|---|
| Date:<br> August 10, 2022 | By: | /s/ Ronald Andrews |
| Ronald<br> Andrews | ||
| Chief<br> Executive Officer |
Exhibit99.1
OncocyteReports Second Quarter 2022 Financial Results
Irvine, Calif., August 10, 2022 – Oncocyte Corporation (Nasdaq: OCX), a precision diagnostics company with the mission to improve patient outcomes by providing personalized insights that inform critical decisions throughout the patient care journey, today reports financial results for the second quarter 2022, ended June 30, 2022.
SecondQuarter and Recent Highlights:
| ● | Recent<br> rightsizing of organization to match new program priorities is expected to reduce headcount carrying costs by over $4.5 million annually<br> and, in combination with reprioritization cost reduction and anticipated strategic activities, annualized operating costs are expected<br> to be reduced by approximately $12 million in 2023 as compared to 2022. |
|---|---|
| ● | Reported<br> total revenue of $2.1 million in the second quarter of 2022, compared with $2.0 million in the second quarter of 2021. |
| ● | Received<br> $1.0 million milestone payment from the final delivery of DetermaRx™ to Burning Rock, our Chinese partner. |
| ● | Grew<br> DetermaRx sample volume by 66% compared to second quarter of 2021 and increased onboarded physician base by 82% as compared<br> to the same period in 2021. |
| ● | Launched<br> our CLIA validated laboratory test for our newly branded VitaGraft™ Liver Transplant Monitoring, a donor-derived cell-free<br> DNA (dd-cfDNA) test. |
| ● | Submitted<br> VitaGraft Liver and VitaGraft Kidney for CMS reimbursement. |
| ● | Clinical<br> Partners presented five abstracts at ASCO and AACR expanding the evidence supporting DetermaIO™ as clinically relevant to decision<br> making in six different cancer types including: |
| ◌ | Independent, prospective randomized clinical trial (RCT) evidence<br>that DetermaIO can identify responders and expand the market for immune checkpoint inhibitor (ICI) therapy in colorectal cancer. |
| --- | --- |
| ◌ | Phase II independent blinded clinical trial evidence that DetermaIO<br>can inform the use of pembrolizumab therapy (Keytruda) in the neoadjuvant treatment of triple negative breast cancer, expanding upon<br>prior reported RCT data with atezolizumab. |
| ● | Closed<br> an underwritten offering of $32.8 million in net proceeds of common stock and warrants, and a preferred stock offering of $4.9 million<br> in net proceeds, to strengthen the balance sheet and further support our product portfolio. |
| --- | --- |
“Our recent reprioritization efforts have led to a rightsizing of our employee base to better match the resourcing required to deliver DetermaIO, DetermaCNI™ and VitaGraft to the market. The expected program cost reductions combined with the reduction in headcount and planned monetization of assets through strategic activities are anticipated to result in a decrease of approximately $12 million in annualized operating expenses year over year, extending our cash runway into 2024,” said Ron Andrews, Chief Executive Officer of Oncocyte. “We continued to make solid progress in the second quarter, delivering 66% year over year growth in DetermaRx sample volumes and successfully onboarding new physicians and accounts. We also successfully completed our CLIA lab test validation of our VitaGraft product line and submitted both Liver and Kidney for CMS reimbursement.”
Continuing, Mr Andrews commented, “Looking ahead, we are excited by the response to the anticipated launch of our VitaGraft Liver test and expect our first samples from a high-profile liver transplant center by the end of August. We also remain on track to submit our dossier for DetermaIO reimbursement this fall. Despite the continued market headwinds, we believe that Oncocyte has an incredibly bright future in front of us as the product development efforts from the past few years are expected to result in new product launches of high value, reimbursed products over the next four to six quarters. I would also like to recognize the promotion of Anish John to CFO and Gisela Paulsen to President and COO. These are well-deserved promotions for two executives that have been instrumental in reshaping our priorities and helping find ways to reduce our burn while still accomplishing our mission. We are now aligned around key areas where our skill sets can best serve Oncocyte’s future. I appreciate the continued support of our shareholders and look forward to updating you as we work to deliver on the key product milestones throughout the second half of 2022.”
SecondQuarter 2022 Financial Results
Total revenue was $2.1 million for the second quarter of 2022, compared to $1.4 million for the prior quarter. Second quarter revenues associated with DetermaRx were $0.8 million, down $0.2 million sequentially, and up $0.2 million year over year. Operating expenses for the second quarter 2022 were $8.2 million, compared to $13.2 million, a decrease of $5.0 million from the same period in the prior year. Research and Development expense for the second quarter 2022 was $5.6 million, an increase of $3.0 million from the same period a year ago~~.~~ The increase in R&D expense was due to full integration of the Chronix R&D team, the growth and enrolment of our clinical trials, and added headcount related to the buildout of our IVD product development capabilities. General and Administrative expense for the second quarter of 2022 was $5.5 million, a decrease of $2.4 million for the same period in 2021, primarily due to one-time acquisition related costs related Chronix Biomedical acquisition in the same period in the prior year. Sales and Marketing expense in the quarter was $3.5 million, an increase of $0.8 million year over year, primarily attributable to an increase in headcount and continued ramp in sales and marketing activities related to the transplant business, as well as support the commercialization efforts within oncology.
Net loss was $8.3 million for the second quarter of 2022 and net loss per share was $0.07 on a weighted-average basic and diluted share count of 113.0 million, compared to a net loss of $10.5 million and a net loss per share of $0.12 on a weighted-average basic and diluted share count of 89.8 million in the same period of the prior year.
Cash, cash equivalents, restricted cash and marketable securities were $47.1 million as of June 30, 2022.
Webcastand Conference Call Information
Oncocyte will host a conference call to discuss the second quarter 2022 financial results after market close on Wednesday, August 10, 2022 at 1:30 p.m. Pacific Time / 4:30 p.m. Eastern Time. The conference call can be accessed live over the phone (877) 407-9716 for U.S. callers or (201) 493-6779 for international callers, using conference ID: 13731553. The live webinar can be accessed at https://investors.oncocyte.com.
AboutOncocyte
Oncocyte is a precision diagnostics company with a mission to improve patient outcomes by providing personalized insights that inform critical decisions throughout the patient care journey.
Through its proprietary tests and pharmaceutical services business, the Company aims to help save lives by accelerating the diagnosis of cancer and advancing cancer care. The Company’s tests are designed to help provide clarity and confidence to physicians and their patients at every stage. DetermaRx™ identifies early-stage lung cancer patients who are at high risk for cancer recurrence and who may benefit from adjuvant chemotherapy. DetermaIO™ is a gene expression test that assesses the tumor microenvironment to predict response to immunotherapies. The Company’s pipeline of tests in development also includes DetermaTx™, which will assess mutational status of a tumor, DetermaCNI™, a blood-based monitoring test, DetermaMx™, a long-term recurrence monitoring test, and VitaGraft™, a blood-based solid organ transplantation monitoring test. In addition, Oncocyte’s pharmaceutical services provide companies that are developing new cancer treatments a full suite of molecular testing services to support the drug development process.
DetermaRx™, DetermaIO™, DetermaTx™, DetermaCNI™, DetermaMx™ and VitaGraft™ are trademarks of Oncocyte Corporation.
Forward-LookingStatements
Any statements that are not historical fact (including, but not limited to statements that contain words such as “will,” “believes,” “plans,” “anticipates,” “expects,” “estimates,” “may,” and similar expressions) are forward-looking statements. These statements include those pertaining to, among other things, expected program cost reductions, planned monetization of assets through strategic activities, the anticipation of a $12 million improvement in annualized operating expenses related to such cost reductions and planned monetization of assets, the expectation that our cash runway will extend well into 2024, the anticipated launch of our VitaGraft Liver product and the expectation that we will receive our first samples from a high-profile liver transplant center by the end of August, the anticipated submission of our dossier for DetermaIO reimbursement this fall, the expectation of new product launches of high value, reimbursed products over the next four to six quarter, and other statements about the future expectations, beliefs, goals, plans, or prospects expressed by management. Forward-looking statements involve risks and uncertainties, including, without limitation, the potential impact of COVID-19 on Oncocyte or its subsidiaries’ financial and operational results, risks inherent in the development and/or commercialization of diagnostic tests or products, uncertainty in the results of clinical trials or regulatory approvals, the capacity of Oncocyte’s third-party supplied blood sample analytic system to provide consistent and precise analytic results on a commercial scale, potential interruptions to supply chains, the need and ability to obtain future capital, maintenance of intellectual property rights in all applicable jurisdictions, obligations to third parties with respect to licensed or acquired technology and products, the need to obtain third party reimbursement for patients’ use of any diagnostic tests Oncocyte or its subsidiaries commercialize in applicable jurisdictions, and risks inherent in strategic transactions such as the potential failure to realize anticipated benefits, legal, regulatory or political changes in the applicable jurisdictions, accounting and quality controls, potential greater than estimated allocations of resources to develop and commercialize technologies, or potential failure to maintain any laboratory accreditation or certification. Actual results may differ materially from the results anticipated in these forward-looking statements and accordingly such statements should be evaluated together with the many uncertainties that affect the business of Oncocyte, particularly those mentioned in the “Risk Factors” and other cautionary statements found in Oncocyte’s Securities and Exchange Commission (SEC) filings, which are available from the SEC’s website. You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they were made. Oncocyte undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.
Investor & Media Contact
Caroline Corner
ICR Westwicke
415.202.5678
Caroline.corner@westwicke.com
ONCOCYTECORPORATION
UNAUDITEDCONDENSED CONSOLIDATED BALANCE SHEETS
(Inthousands)
| December 31, 2021 | |||||
|---|---|---|---|---|---|
| ASSETS | |||||
| CURRENT ASSETS | |||||
| Cash and cash equivalents | 44,836 | $ | 35,605 | ||
| Accounts receivable | 1,802 | 1,437 | |||
| Marketable equity securities | 579 | 904 | |||
| Prepaid expenses and other current assets | 2,151 | 1,197 | |||
| Total current assets | 49,368 | 39,143 | |||
| NONCURRENT ASSETS | |||||
| Right-of-use and financing lease assets, net | 2,489 | 2,779 | |||
| Machinery and equipment, net, and construction in progress | 9,087 | 5,748 | |||
| Goodwill | 18,684 | 18,684 | |||
| Intangible assets, net | 89,341 | 91,245 | |||
| Restricted cash | 1,700 | 1,700 | |||
| Other noncurrent assets | 382 | 264 | |||
| TOTAL ASSETS | 171,051 | $ | 159,563 | ||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||
| CURRENT LIABILITIES | |||||
| Accounts payable | 2,465 | $ | 2,447 | ||
| Accrued compensation | 2,789 | 3,376 | |||
| Accrued expenses and other current liabilities | 4,564 | 2,425 | |||
| Accrued severance from acquisition | 2,314 | 2,352 | |||
| Accrued liabilities from acquisition | 609 | 1,388 | |||
| Loans payable, net of deferred financing costs | 574 | 1,313 | |||
| Right-of-use and financing lease liabilities, current | 839 | 819 | |||
| Total current liabilities | 14,154 | 14,120 | |||
| NONCURRENT LIABILITIES | |||||
| Right-of-use and financing lease liabilities, noncurrent | 3,134 | 3,545 | |||
| Contingent consideration liabilities | 65,666 | 76,681 | |||
| TOTAL LIABILITIES | 82,954 | 94,346 | |||
| Commitments and contingencies | |||||
| Series A Redeemable Convertible Preferred Stock, no par value; stated value 1,000 per share; 12 shares authorized, 6 shares issued and outstanding at June 30, 2022; aggregate liquidation preference of 5,911 as of June 30, 2022 | 4,854 | - | |||
| SHAREHOLDERS’ EQUITY | |||||
| Preferred stock, no par value, 5,000 shares authorized; no shares issued and outstanding | - | - | |||
| Common stock, no par value, 230,000 shares authorized; 118,609 and 92,232 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively | 289,649 | 252,954 | |||
| Accumulated other comprehensive loss | 31 | 37 | |||
| Accumulated deficit | (206,437 | ) | (187,774 | ) | |
| Total shareholders’ equity | 83,243 | 65,217 | |||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | 171,051 | $ | 159,563 |
All values are in US Dollars.
ONCOCYTECORPORATION
UNAUDITEDCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Inthousands, except per share data)
| Three Months Ended | Six Months Ended | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| June 30, | June 30, | |||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||
| Net revenue | $ | 2,067 | $ | 2,030 | $ | 3,491 | $ | 3,154 | ||||
| Cost of revenues | 1,405 | 1,350 | 2,426 | 2,088 | ||||||||
| Cost of revenues – amortization of acquired intangibles | 976 | 1,074 | 1,912 | 1,381 | ||||||||
| Gross profit | (314 | ) | (394 | ) | (847 | ) | (315 | ) | ||||
| Operating expenses: | ||||||||||||
| Research and development | 5,574 | 2,537 | 10,702 | 5,898 | ||||||||
| Sales and marketing | 3,522 | 2,673 | 6,759 | 4,927 | ||||||||
| General and administrative | 5,511 | 7,934 | 11,164 | 12,698 | ||||||||
| Change in fair value of contingent consideration | (6,359 | ) | 30 | (11,015 | ) | 1,090 | ||||||
| Total operating expenses | 8,248 | 13,174 | 17,610 | 24,613 | ||||||||
| Loss from operations | (8,562 | ) | (13,568 | ) | (18,457 | ) | (24,928 | ) | ||||
| OTHER INCOME (EXPENSES), NET | ||||||||||||
| Interest expense, net | (21 | ) | (49 | ) | (51 | ) | (117 | ) | ||||
| Unrealized gain (loss) on marketable equity securities | 5 | 173 | (325 | ) | 386 | |||||||
| Pro rata loss from equity method investment in Razor | - | - | - | (270 | ) | |||||||
| Gain on extinguishment of debt (PPP loan) | - | 1,141 | - | 1,141 | ||||||||
| Other income, net | 278 | 16 | 242 | 18 | ||||||||
| Total other expenses, net | 262 | 1,281 | (134 | ) | 1,158 | |||||||
| LOSS BEFORE INCOME TAXES | (8,300 | ) | (12,287 | ) | (18,591 | ) | (23,770 | ) | ||||
| Income tax benefit | - | 1,794 | - | 9,358 | ||||||||
| NET LOSS | $ | (8,300 | ) | $ | (10,493 | ) | $ | (18,591 | ) | $ | (14,412 | ) |
| Net loss per share: basic and diluted | $ | (0.07 | ) | $ | (0.12 | ) | $ | (0.18 | ) | $ | (0.17 | ) |
| Weighted average shares outstanding: basic and diluted | 113,042 | 89,758 | 102,700 | 85,961 |
ONCOCYTECORPORATION
UNAUDITEDCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Inthousands)
| Six Months Ended | ||||||
|---|---|---|---|---|---|---|
| June 30, | ||||||
| 2022 | 2021 | |||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||
| Net loss | $ | (18,591 | ) | $ | (14,412 | ) |
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||
| Depreciation expense | 671 | 327 | ||||
| Amortization of intangible assets | 1,904 | 1,381 | ||||
| Pro rata loss from equity method investment in Razor | - | 270 | ||||
| Stock-based compensation | 4,242 | 3,286 | ||||
| Unrealized (gain) loss on marketable equity securities | 325 | (386 | ) | |||
| Amortization of debt issuance costs | 11 | 33 | ||||
| Change in fair value of contingent consideration | (11,015 | ) | 1,090 | |||
| Change in fair value of Series A redeemable convertible preferred stock second tranche obligation | (305 | ) | 33 | |||
| Deferred income tax benefit | - | (9,358 | ) | |||
| Gain on extinguishment of debt (PPP loan) | - | (1,141 | ) | |||
| Accrued severance from Chronix Biomedical acquisition | - | 2,452 | ||||
| Changes in operating assets and liabilities: | ||||||
| Accounts receivable | (365 | ) | (817 | ) | ||
| Lease liabilities | (94 | ) | 218 | |||
| Prepaid expenses and other assets | (773 | ) | (103 | ) | ||
| Accounts payable and accrued liabilities | 239 | (766 | ) | |||
| Accrued severance and liabilities from Chronix Biomedical acquisition | (817 | ) | - | |||
| Net cash used in operating activities | (24,568 | ) | (17,893 | ) | ||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||
| Acquisition of Insight Genetics, net of cash acquired | - | (607 | ) | |||
| Acquisition of Razor Genomics asset, net of cash acquired | - | (6,648 | ) | |||
| Acquisition of Chronix Biomedical, net of cash acquired | - | (4,459 | ) | |||
| Construction in progress and purchases of furniture and equipment | (2,679 | ) | (1,452 | ) | ||
| Net cash used in investing activities | (2,679 | ) | (13,166 | ) | ||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||
| Proceeds from exercise of stock options | - | 1,600 | ||||
| Proceeds from sale of common shares | 32,812 | 65,262 | ||||
| Financing costs to issue common shares | (389 | ) | (2,676 | ) | ||
| Proceeds from sale of redeemable convertible Series A preferred shares | 4,875 | - | ||||
| Financing costs to issue redeemable convertible Series A preferred shares | (93 | ) | - | |||
| Proceeds from sale of common shares under at-the-market transactions | 31 | 6,483 | ||||
| Financing costs for at-the-market sales | (1 | ) | (203 | ) | ||
| Proceeds from exercise of warrants | - | 823 | ||||
| Common shares received and retired for employee taxes paid | - | (37 | ) | |||
| Repayment of loan payable | (750 | ) | (750 | ) | ||
| Repayment of financing lease obligations | (7 | ) | (84 | ) | ||
| Net cash provided by financing activities | 36,478 | 70,418 | ||||
| NET INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | 9,231 | 39,359 | ||||
| CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING | 37,305 | 8,843 | ||||
| CASH, CASH EQUIVALENTS AND RESTRICTED CASH, ENDING | $ | 46,536 | $ | 48,202 | ||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||||||
| Cash paid for interest | $ | 21 | $ | 70 | ||
| SUPPLEMENTAL SCHEDULE OF NONCASH FINANCING AND INVESTING ACTIVITIES | ||||||
| Common stock issued for acquisition of Razor Genomics asset | $ | - | $ | 5,756 | ||
| Deferred tax liability generated from the acquisition of Razor Genomics asset | - | 7,564 | ||||
| Common stock issued for acquisition of Chronix Biomedical | - | 3,299 | ||||
| Deferred tax liability generated from the acquisition of Chronix | - | 1,794 | ||||
| Initial fair value of contingent consideration at acquisition date | - | 42,295 | ||||
| Assumed liability from Chronix Acquisition | - | 9,294 | ||||
| Construction in progress, machinery and equipment purchases included in accounts payable, accrued liabilities and landlord liability | 1,331 | 9 |
OncocyteCorporation
Reconciliationof Non-GAAP Financial Measure
AdjustedLoss from Operations
(Amountsin Thousands)
| For the Three Months Ended | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| June 30, | December 31, | June 30, | |||||||
| 2022 | 2021 | 2021 | |||||||
| (unaudited) | (unaudited) | (unaudited) | |||||||
| GAAP loss from operations - as reported | $ | (8,562 | ) | $ | (35,680 | ) | $ | (13,568 | ) |
| Stock-based compensation expense | 2,232 | 1,706 | 1,996 | ||||||
| Change in fair value of contingent consideration | (6,359 | ) | 25,006 | 30 | |||||
| Severance charge | 143 | 255 | 2,452 | ||||||
| Depreciation and amortization expense | 1,360 | 1,251 | 1,280 | ||||||
| Non-GAAP loss from operations, as adjusted | $ | (11,186 | ) | $ | (7,462 | ) | $ | (7,810 | ) |