Balance Sheet Components

9 Months Ended

Sep. 30, 2024

Balance Sheet Components

Balance Sheet Components

6. Balance Sheet Components

Allowance for doubtful accounts

The following is a roll-forward of the allowances for doubtful accounts related to trade accounts receivable for the three and nine months ended September 30, 2024 and 2023:

	Three Months Ended
	September 30,
	2024		2023
		(in thousands)
Beginning balance	$	7,021	$	5,580
(Reversal of) Provision for doubtful accounts		(536)		454
Write-offs		(233)		—
Total	$	6,252	$	6,034

	Nine Months Ended
	September 30,
	2024		2023
		(in thousands)
Beginning balance	$	6,481	$	3,830
Provision for doubtful accounts		208		2,204
Write-offs		(437)		—
Total	$	6,252	$	6,034

Property and Equipment, net

The Company’s property and equipment consisted of the following:

		September 30,		December 31,
	Useful Life	2024		2023
		(in thousands)
Machinery and equipment	3-5 years	$	104,443	$	85,626
Computer equipment	3 years		3,040		1,850
Purchased and capitalized software held for internal use	3 years		11,104		11,636
Leasehold improvements	Lesser of useful life or lease term		48,080		38,999
Construction-in-process			46,631		29,392
			213,298		167,503
Less: Accumulated depreciation and amortization			(71,128)		(56,293)
Total Property and Equipment, net		$	142,170	$	111,210

The Company’s long-lived assets are located in the United States.

During the nine months ended September 30, 2024, the increase in net property and equipment was due to expansion projects and purchases of new equipment for the Company’s laboratories located in Texas and California to expand testing capabilities, offset by depreciation expense of $19.9 million recorded in the nine months ended September 30, 2024. Depreciation expense of $16.1 million was recorded in the nine months ended September 30, 2023. The Company did not incur any impairment charges during the nine months ended September 30, 2024 or 2023.

Other Accrued Liabilities

The Company’s other accrued liabilities consisted of the following:

	September 30,		December 31,
	2024		2023
	(in thousands)
Reserves for refunds to insurance carriers	$	15,778	$	23,245
Accrued charges for third-party testing		9,924		14,823
Testing and laboratory materials from suppliers		9,823		11,229
Marketing and corporate affairs		15,526		10,085
Legal, audit and consulting fees		36,535		43,897
Accrued shipping charges		2,180		3,646
Sales and income tax payable		5,061		3,731
Accrued third-party service fees		8,853		7,111
Clinical trials and studies		7,744		12,126
Operating lease liabilities, current portion		9,762		11,621
Property and equipment purchases		3,397		4,316
Other accrued interest		1		1,078
Other accrued expenses		1,592		2,497
Total other accrued liabilities	$	126,176	$	149,405

Reserves for refunds to insurance carriers include overpayments from and amounts to be refunded to insurance carriers and additional amounts that the Company estimates for potential refund requests during the period. When the Company releases these previously accrued amounts, they are recognized as product revenues in the condensed statements of operations and comprehensive loss.

The following table summarizes the reserve balance and activities for refunds to insurance carriers for the nine months ending September 30, 2024 and 2023:

	September 30,
	2024		2023
	(in thousands)
Beginning balance	$	23,245	$	18,948
Additional reserves		1,506		7,348
Refunds to carriers		(3,095)		(1,236)
Reserves released to revenue		(5,878)		(8,851)
Ending balance	$	15,778	$	16,209

During the quarter ended September 30, 2024, the Company repaid $13.8 million in short term advances obtained as a result of the disruption to Change Healthcare’s network in February 2024.