Quarterly report pursuant to Section 13 or 15(d)

Discontinuing Operations

v3.20.2
Discontinuing Operations
 9 Months Ended
Sep. 30, 2020
Discontinued Operations and Disposal Groups [Abstract]  
Discontinuing Operations Discontinuing Operations
As described in Note 1, the Company sold its BioPharma Business and Clinical Business in July 2019. In conjunction with the BioPharma Disposal, the Company repaid its debt to SVB and PFG. The Company elected to allocate approximately $22 thousand and $1.5 million of interest expense from the Convertible Note and Advance from NDX to discontinuing operations during the three and nine months ended September 30, 2019. Revenue and other significant accounting policies associated with the discontinuing operations have not changed since the most recently filed audited financial statements as of and for the year ended December 31, 2019.

Summarized results of the Company's unaudited condensed consolidated discontinuing operations are as follows for the three and nine months ended September 30, 2020 and 2019 (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,
2020 2019 2020 2019
Revenue $ —  $ 428  $ —  $ 10,066 
Cost of revenues —  567  —  7,667 
Gross profit —  (139) —  2,399 
Operating expenses:
Research and development —  47  —  937 
General and administrative (9) 796  (83) 4,306 
Sales and marketing —  15  1,528 
Restructuring costs —  100  —  100 
Transaction costs 9  —  9  651 
Impairment of patents and other intangible assets —  601  —  601 
Total operating expenses —  1,559  (74) 8,123 
Income (loss) from discontinuing operations —  (1,698) 74  (5,724)
Other income (expense):
Interest expense —  (38) —  (2,211)
Gain on disposal of Clinical Business —  1,222  —  1,222 
Gain on disposal of BioPharma Business —  7,274  —  7,274 
Total other income (expense) —  8,458  —  6,285 
Net income (loss) from discontinuing operations $ —  $ 6,760  $ 74  $ 561 

Unaudited condensed consolidated carrying amounts of major classes of assets and liabilities from discontinuing operations were as follows as of September 30, 2020 and December 31, 2019 (in thousands):
September 30, 2020 December 31, 2019
Current assets of discontinuing operations:
Accounts receivable, net of allowance for doubtful accounts of $4,518 in 2020; $4,536 in 2019
 $ —  $ 71 
Current assets of discontinuing operations $ —  $ 71 
Current liabilities of discontinuing operations
Accounts payable and accrued expenses $ 578  $ 1,137 
Due to Interpace Biosciences, Inc. —  92 
Current liabilities of discontinuing operations $ 578  $ 1,229 


Cash flows used in operating activities of discontinuing operations consisted of the following for the nine-months ended September 30, 2020 and 2019 (in thousands):
  Nine Months Ended September 30,
  2020 2019
Income from discontinuing operations $ 74  $ 561 
Adjustments to reconcile income from discontinuing operations to net cash used in operating activities, discontinuing operations
Depreciation —  542 
Amortization —  613 
Provision for bad debts (28) 323 
Accounts payable settlements (43) — 
Stock-based compensation (8) 91 
Amortization of operating lease right-of-use assets —  436 
Amortization of discount of debt and debt issuance costs —  601 
Loss on extinguishment of debt —  328 
Interest added to Convertible Note —  343 
Gain on disposal of Clinical buisness —  (1,222)
Gain on disposal of BioPharma buisness —  (7,274)
Change in working capital components:
Accounts receivable 99  711 
Other current assets —  277 
Other non-current assets —  2 
Accounts payable, accrued expenses and deferred revenue (516) (1,273)
Obligations under operating leases —  (368)
Due to Interpace Biosciences, Inc. (92) — 
Net cash used in operating activities, discontinuing operations $ (514) $ (5,309)