Restructuring

9 Months Ended

Sep. 30, 2023

Restructuring

Restructuring

Note 15. Restructuring

Following a strategic review and assessment of the Company’s operations and cost structure, on August 8, 2022, the Company announced a restructuring and strategic re-alignment plan (the “Restructuring Plan”). As part of the Restructuring Plan, the Company began an assay redevelopment program with the ultimate objective of improving its ability to manufacture and deliver high-quality assays at scale. The Restructuring Plan aligns the Company’s investments to best serve the needs of its customers, focuses the Company’s innovation efforts on key platforms, and provides a foundation for the Company’s entry into translational pharma and clinical markets, which it believes will be required to access new growth categories. In accordance with the Restructuring Plan, the Company implemented a workforce reduction, which was substantially completed by the end of the third quarter of 2022. The Restructuring Plan included the elimination of 119 positions and other cost-saving measures.

During the three and nine months ended September 30, 2022, the Company incurred approximately $3.4 million of expenses related to the Restructuring Plan, which were recorded in impairment and restructuring on the Consolidated Statements of Operations. These expenses were substantially for cash payments of severance and employee benefits, $3.1 million of which was paid by September 30, 2022.

Total restructuring expenses incurred in 2022 under the Restructuring Plan were $3.8 million.

As a result of the Restructuring Plan, the Company performed an impairment assessment of its goodwill, long-lived assets, including operating lease right-of-use assets, and intangibles. The assessments resulted in the Company recording an impairment charge of $16.9 million during the three and nine months ended September 30, 2022, which was recorded in impairment and restructuring on the Consolidated Statements of Operations. The impairment charge included (1) $8.2 million of goodwill (refer to Note 12 − Goodwill), (2) $7.7 million associated with the operating lease right-of-use asset and related property and equipment at leased facilities no longer being utilized, and (3) $1.0 million for software costs related to projects that were rationalized as part of the Restructuring Plan. During the nine months ended September 30, 2023, there were no material changes to the Restructuring Plan or the related exit and disposal costs.

The following table presents the restructuring reserve and provision activity for the nine months ended September 30, 2023 (in thousands):

	Severance and Employee Benefit Costs
Balance at December 31, 2022	$	328
Accrual adjustments		(33)
Cash payments		(16)
Foreign currency translation		(4)
Balance at September 30, 2023	$	275

The Company did not have any restructuring activities or additional impairment charges related to the Restructuring Plan during the nine months ended September 30, 2023.