Accounts Receivable and Allowance for Doubtful Accounts

9 Months Ended

Sep. 30, 2015

Receivables [Abstract]

Accounts Receivable and Allowance for Doubtful Accounts

6. Accounts Receivable and Allowance for Doubtful Accounts

The Company’s accounts receivable consist primarily of amounts due from biopharmaceutical customers, and from certain hospitals, cancer centers and other institutions with whom it has negotiated price per test (direct bill) relationships for tests performed using its molecular information platform. There are no accounts receivable associated with amounts that are billed to commercial third-party payors or directly to patients, because this revenue is recognized on a cash basis. The Company determines its allowance by considering a number of factors, including the length of time accounts receivable are past due, previous loss history, a specific customer’s ability to pay its obligations to the Company, and the condition of the general economy and industry as a whole. As of September 30, 2015 and December 31, 2014, the Company recorded an allowance for doubtful accounts of $171,000 and $0, respectively.