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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Invitae Corporation | NYSE:NVTA | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0.0891 | 0 | 01:00:00 |
Form 10‑Q
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☒
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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27-1701898
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(State or other jurisdiction of
incorporation or organization)
|
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(I.R.S. Employer
Identification No.)
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Large accelerated filer
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☐
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Accelerated filer
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☒
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Non-accelerated filer
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☐
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Smaller reporting company
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☐
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Emerging growth company
|
☒
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Title of each class
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Trading Symbol
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Name of exchange on which registered
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Common Stock, $0.0001 par value per share
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NVTA
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New York Stock Exchange
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Page No.
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September 30,
2019 |
|
December 31,
2018 |
||||
Assets
|
|
|
|
|
|
||
Current assets:
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
467,012
|
|
|
$
|
112,158
|
|
Marketable securities
|
300
|
|
|
13,727
|
|
||
Accounts receivable
|
26,740
|
|
|
26,296
|
|
||
Prepaid expenses and other current assets
|
14,477
|
|
|
13,258
|
|
||
Total current assets
|
508,529
|
|
|
165,439
|
|
||
Property and equipment, net
|
32,177
|
|
|
27,886
|
|
||
Operating lease assets
|
39,112
|
|
|
—
|
|
||
Restricted cash
|
6,183
|
|
|
6,006
|
|
||
Intangible assets, net
|
99,740
|
|
|
30,469
|
|
||
Goodwill
|
99,851
|
|
|
50,095
|
|
||
Other assets
|
4,795
|
|
|
3,064
|
|
||
Total assets
|
$
|
790,387
|
|
|
$
|
282,959
|
|
Liabilities and stockholders’ equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
8,863
|
|
|
$
|
7,812
|
|
Accrued liabilities
|
53,251
|
|
|
26,563
|
|
||
Operating lease obligations
|
5,186
|
|
|
—
|
|
||
Finance lease obligations
|
1,636
|
|
|
1,937
|
|
||
Total current liabilities
|
68,936
|
|
|
36,312
|
|
||
Operating lease obligations, net of current portion
|
44,408
|
|
|
—
|
|
||
Finance lease obligations, net of current portion
|
168
|
|
|
1,375
|
|
||
Debt
|
—
|
|
|
74,477
|
|
||
Convertible senior notes, net
|
265,194
|
|
|
—
|
|
||
Other long-term liabilities
|
7,800
|
|
|
8,956
|
|
||
Total liabilities
|
386,506
|
|
|
121,120
|
|
||
Commitments and contingencies (Note 8)
|
|
|
|
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Common stock
|
10
|
|
|
8
|
|
||
Accumulated other comprehensive loss
|
—
|
|
|
(5
|
)
|
||
Additional paid-in capital
|
1,085,643
|
|
|
678,548
|
|
||
Accumulated deficit
|
(681,772
|
)
|
|
(516,712
|
)
|
||
Total stockholders’ equity
|
403,881
|
|
|
161,839
|
|
||
Total liabilities and stockholders’ equity
|
$
|
790,387
|
|
|
$
|
282,959
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Test revenue
|
$
|
55,502
|
|
|
$
|
36,611
|
|
|
$
|
147,423
|
|
|
$
|
100,014
|
|
Other revenue
|
1,009
|
|
|
755
|
|
|
3,116
|
|
|
2,329
|
|
||||
Total revenue
|
56,511
|
|
|
37,366
|
|
|
150,539
|
|
|
102,343
|
|
||||
Cost of revenue
|
32,120
|
|
|
20,441
|
|
|
81,380
|
|
|
58,964
|
|
||||
Research and development
|
46,951
|
|
|
15,776
|
|
|
90,247
|
|
|
46,926
|
|
||||
Selling and marketing
|
32,690
|
|
|
17,591
|
|
|
87,662
|
|
|
55,222
|
|
||||
General and administrative
|
21,733
|
|
|
13,668
|
|
|
56,326
|
|
|
37,884
|
|
||||
Loss from operations
|
(76,983
|
)
|
|
(30,110
|
)
|
|
(165,076
|
)
|
|
(96,653
|
)
|
||||
Other income (expense), net
|
(7,591
|
)
|
|
231
|
|
|
(5,572
|
)
|
|
2,066
|
|
||||
Interest expense
|
(2,833
|
)
|
|
(1,844
|
)
|
|
(7,062
|
)
|
|
(4,927
|
)
|
||||
Net loss before taxes
|
(87,407
|
)
|
|
(31,723
|
)
|
|
(177,710
|
)
|
|
(99,514
|
)
|
||||
Income tax benefit
|
(8,700
|
)
|
|
—
|
|
|
(12,650
|
)
|
|
—
|
|
||||
Net loss
|
$
|
(78,707
|
)
|
|
$
|
(31,723
|
)
|
|
$
|
(165,060
|
)
|
|
$
|
(99,514
|
)
|
Net loss per share, basic and diluted
|
$
|
(0.82
|
)
|
|
$
|
(0.45
|
)
|
|
$
|
(1.86
|
)
|
|
$
|
(1.56
|
)
|
Shares used in computing net loss per share, basic and diluted
|
95,577
|
|
|
70,153
|
|
|
88,663
|
|
|
63,935
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net loss
|
$
|
(78,707
|
)
|
|
$
|
(31,723
|
)
|
|
$
|
(165,060
|
)
|
|
$
|
(99,514
|
)
|
Other comprehensive income:
|
|
|
|
|
|
|
|
||||||||
Unrealized income on available-for-sale marketable securities, net of tax
|
—
|
|
|
63
|
|
|
5
|
|
|
125
|
|
||||
Comprehensive loss
|
$
|
(78,707
|
)
|
|
$
|
(31,660
|
)
|
|
$
|
(165,055
|
)
|
|
$
|
(99,389
|
)
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Common stock:
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
$
|
9
|
|
|
6
|
|
|
$
|
8
|
|
|
$
|
5
|
|
|
Common stock issued
|
1
|
|
|
1
|
|
|
2
|
|
|
2
|
|
||||
Balance, end of period
|
10
|
|
|
7
|
|
|
10
|
|
|
7
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Accumulated other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
—
|
|
|
(109
|
)
|
|
(5
|
)
|
|
(171
|
)
|
||||
Unrealized income on available-for-sale marketable securities, net of tax
|
—
|
|
|
63
|
|
|
5
|
|
|
125
|
|
||||
Balance, end of period
|
—
|
|
|
(46
|
)
|
|
—
|
|
|
(46
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Additional paid-in capital:
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
944,559
|
|
|
593,898
|
|
|
678,548
|
|
|
520,558
|
|
||||
Common stock issued in connection with public offering, net
|
19,534
|
|
|
58,988
|
|
|
204,024
|
|
|
112,467
|
|
||||
Common stock issued on exercise of stock options, net
|
553
|
|
|
2,522
|
|
|
2,985
|
|
|
2,570
|
|
||||
Common stock issued pursuant to exercises of warrants
|
58
|
|
|
3,209
|
|
|
171
|
|
|
6,461
|
|
||||
Common stock issued pursuant to employee stock purchase plan
|
—
|
|
|
—
|
|
|
2,578
|
|
|
1,633
|
|
||||
Common stock issued or issuable pursuant to business combinations
|
35,778
|
|
|
2,482
|
|
|
95,220
|
|
|
6,455
|
|
||||
Equity component of convertible senior notes, net
|
75,488
|
|
|
—
|
|
|
75,488
|
|
|
—
|
|
||||
Warrants issued pursuant to loan agreement
|
—
|
|
|
—
|
|
|
—
|
|
|
383
|
|
||||
Stock-based compensation expense
|
9,673
|
|
|
5,206
|
|
|
26,629
|
|
|
15,711
|
|
||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
67
|
|
||||
Balance, end of period
|
1,085,643
|
|
|
666,305
|
|
|
1,085,643
|
|
|
666,305
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Accumulated deficit:
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
(603,065
|
)
|
|
(455,148
|
)
|
|
(516,712
|
)
|
|
(398,598
|
)
|
||||
Cumulative effect of accounting change
|
—
|
|
|
—
|
|
|
—
|
|
|
11,241
|
|
||||
Net loss
|
(78,707
|
)
|
|
(31,723
|
)
|
|
(165,060
|
)
|
|
(99,514
|
)
|
||||
Balance, end of period
|
(681,772
|
)
|
|
(486,871
|
)
|
|
(681,772
|
)
|
|
(486,871
|
)
|
||||
Total stockholders' equity
|
$
|
403,881
|
|
|
$
|
179,395
|
|
|
$
|
403,881
|
|
|
$
|
179,395
|
|
•
|
revenue recognition (See Note 3, “Revenue, accounts receivable and deferred revenue” for further information);
|
•
|
the fair value of assets acquired and liabilities assumed for business combinations;
|
•
|
the fair value of goodwill and intangible assets;
|
•
|
valuation of the liability and equity components of our convertible notes issued in September 2019 ("Convertible Senior Notes");
|
•
|
the recoverability of long-lived assets;
|
•
|
our incremental borrowing rates used to calculate our lease obligations;
|
•
|
stock-based compensation expense and the fair value of awards issued; and
|
•
|
income tax uncertainties.
|
|
September 30, 2019
|
|
December 31, 2018
|
||
Medicare
|
12
|
%
|
|
21
|
%
|
|
September 30,
2019 |
|
December 31,
2018 |
||||
Cash and cash equivalents
|
$
|
467,012
|
|
|
$
|
112,158
|
|
Restricted cash
|
6,183
|
|
|
6,006
|
|
||
Total cash, cash equivalents and restricted cash
|
$
|
473,195
|
|
|
$
|
118,164
|
|
|
|
December 31, 2018
|
|
Adjustments Due to the Adoption of Topic 842
|
|
January 1, 2019
|
||||||
Property and equipment, net
|
|
$
|
27,886
|
|
|
$
|
(5,159
|
)
|
|
$
|
22,727
|
|
Operating lease assets
|
|
$
|
—
|
|
|
$
|
36,711
|
|
|
$
|
36,711
|
|
Other assets
|
|
$
|
3,064
|
|
|
$
|
5,159
|
|
|
$
|
8,223
|
|
Accrued liabilities
|
|
$
|
26,563
|
|
|
$
|
(490
|
)
|
|
$
|
26,073
|
|
Operating lease obligations
|
|
$
|
—
|
|
|
$
|
4,697
|
|
|
$
|
4,697
|
|
Operating lease obligations, net of current portion
|
|
$
|
—
|
|
|
$
|
41,279
|
|
|
$
|
41,279
|
|
Other long-term liabilities
|
|
$
|
8,956
|
|
|
$
|
(8,775
|
)
|
|
$
|
181
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Test revenue:
|
|
|
|
|
|
|
|
||||||||
Institutions
|
$
|
10,407
|
|
|
$
|
8,958
|
|
|
$
|
28,375
|
|
|
$
|
24,761
|
|
Patient - direct
|
4,567
|
|
|
3,280
|
|
|
12,364
|
|
|
9,705
|
|
||||
Patient - insurance
|
40,528
|
|
|
24,373
|
|
|
106,684
|
|
|
65,548
|
|
||||
Total test revenue
|
55,502
|
|
|
36,611
|
|
|
147,423
|
|
|
100,014
|
|
||||
Other revenue
|
1,009
|
|
|
755
|
|
|
3,116
|
|
|
2,329
|
|
||||
Total revenue
|
$
|
56,511
|
|
|
$
|
37,366
|
|
|
$
|
150,539
|
|
|
$
|
102,343
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenue
|
$
|
1.2
|
|
|
$
|
1.5
|
|
|
$
|
4.0
|
|
|
$
|
3.8
|
|
Loss from operations
|
$
|
(1.2
|
)
|
|
$
|
(1.5
|
)
|
|
$
|
(4.0
|
)
|
|
$
|
(3.8
|
)
|
Net loss per share, basic and diluted
|
$
|
(0.01
|
)
|
|
$
|
(0.02
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.06
|
)
|
Cash
|
$
|
4,988
|
|
Property and equipment
|
303
|
|
|
In-process research and development
|
29,988
|
|
|
Total identifiable assets acquired
|
35,279
|
|
|
Current liabilities assumed
|
(479
|
)
|
|
Deferred tax liability
|
(3,950
|
)
|
|
Net identifiable assets acquired
|
30,850
|
|
|
Goodwill
|
26,461
|
|
|
Total purchase price
|
$
|
57,311
|
|
|
Purchase Price
|
|
Post-combination Expense
|
||||
Cash transferred
|
$
|
13,261
|
|
|
$
|
2,151
|
|
Hold-back consideration - cash
|
270
|
|
|
253
|
|
||
Hold-back consideration - common stock
|
4,574
|
|
|
—
|
|
||
Contingent consideration
|
10,158
|
|
|
542
|
|
||
Common stock transferred
|
30,753
|
|
|
—
|
|
||
Total
|
$
|
59,016
|
|
|
$
|
2,946
|
|
Cash
|
$
|
289
|
|
Developed technology
|
44,140
|
|
|
Total identifiable assets acquired
|
44,429
|
|
|
Accounts payable
|
(8
|
)
|
|
Deferred tax liability
|
(8,700
|
)
|
|
Net identifiable assets acquired
|
35,721
|
|
|
Goodwill
|
23,295
|
|
|
Total purchase price
|
$
|
59,016
|
|
•
|
transaction expenses incurred by Singular Bio, Jungla and us,
|
•
|
the impacts of the co-development agreement between Singular Bio and us,
|
•
|
the historical interest expense incurred by Singular Bio on its debt and debt-like items,
|
•
|
compensation expense recognized in relation to the equity awards granted in connection with the acquisition of Singular Bio,
|
•
|
amortization expense resulting from the developed technology acquired through the acquisition of Jungla,
|
•
|
post-combination expense,
|
•
|
income tax benefits resulting from the deferred tax liabilities acquired, and
|
•
|
the 2.5 million and 1.4 million shares of our common stock issued upon the closing of the Singular Bio and Jungla transactions, respectively.
|
|
Three Months Ended September 30,
|
||||||||||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||||||||||
|
Invitae
|
|
Singular Bio
|
|
Jungla
|
|
Total
|
|
Invitae
|
|
Singular Bio
|
|
Jungla
|
|
Total
|
||||||||||||||||
Revenue
|
$
|
56,511
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
56,511
|
|
|
$
|
37,366
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
37,366
|
|
Net loss
|
$
|
(78,707
|
)
|
|
$
|
18,613
|
|
|
$
|
(5,831
|
)
|
|
$
|
(65,925
|
)
|
|
$
|
(31,723
|
)
|
|
$
|
(139
|
)
|
|
$
|
(1,254
|
)
|
|
$
|
(33,116
|
)
|
Shares
|
95,577
|
|
|
—
|
|
|
225
|
|
|
95,802
|
|
|
70,153
|
|
|
2,499
|
|
|
1,366
|
|
|
74,018
|
|
||||||||
Basic and diluted net loss per share
|
$
|
(0.82
|
)
|
|
|
|
|
|
|
|
$
|
(0.69
|
)
|
|
$
|
(0.45
|
)
|
|
|
|
|
|
|
|
$
|
(0.45
|
)
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||||||||||
|
Invitae
|
|
Singular Bio
|
|
Jungla
|
|
Total
|
|
Invitae
|
|
Singular Bio
|
|
Jungla
|
|
Total
|
||||||||||||||||
Revenue
|
$
|
150,539
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
150,539
|
|
|
$
|
102,343
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
102,343
|
|
Net loss
|
$
|
(165,060
|
)
|
|
$
|
21,844
|
|
|
$
|
(8,381
|
)
|
|
$
|
(151,597
|
)
|
|
$
|
(99,514
|
)
|
|
$
|
(1,071
|
)
|
|
$
|
(3,762
|
)
|
|
$
|
(104,347
|
)
|
Shares
|
88,663
|
|
|
1,553
|
|
|
984
|
|
|
91,200
|
|
|
63,935
|
|
|
2,499
|
|
|
1,366
|
|
|
67,800
|
|
||||||||
Basic and diluted net loss per share
|
$
|
(1.86
|
)
|
|
|
|
|
|
|
|
$
|
(1.66
|
)
|
|
$
|
(1.56
|
)
|
|
|
|
|
|
|
|
$
|
(1.54
|
)
|
Balance as of December 31, 2018
|
$
|
50,095
|
|
Goodwill acquired - Singular Bio
|
26,461
|
|
|
Goodwill acquired - Jungla
|
23,295
|
|
|
Balance as of September 30, 2019
|
$
|
99,851
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||||||
|
Cost
|
|
Accumulated
Amortization |
|
Net
|
|
Weighted-Average
Useful Life (in Years) |
|
Cost
|
|
Accumulated
Amortization |
|
Net
|
|
Weighted-Average
Useful Life (in Years) |
||||||||||||
Customer relationships
|
$
|
23,763
|
|
|
$
|
(4,550
|
)
|
|
$
|
19,213
|
|
|
10.0
|
|
$
|
23,763
|
|
|
$
|
(2,783
|
)
|
|
$
|
20,980
|
|
|
10.0
|
Developed technology
|
56,103
|
|
|
(6,298
|
)
|
|
49,805
|
|
|
8.9
|
|
11,963
|
|
|
(3,482
|
)
|
|
8,481
|
|
|
4.8
|
||||||
Non-compete agreement
|
286
|
|
|
(157
|
)
|
|
129
|
|
|
5.0
|
|
286
|
|
|
(114
|
)
|
|
172
|
|
|
5.0
|
||||||
Trade name
|
576
|
|
|
(441
|
)
|
|
135
|
|
|
2.7
|
|
576
|
|
|
(329
|
)
|
|
247
|
|
|
2.7
|
||||||
Patent licensing agreement
|
496
|
|
|
(64
|
)
|
|
432
|
|
|
15.0
|
|
496
|
|
|
(37
|
)
|
|
459
|
|
|
15.0
|
||||||
Favorable leases
|
247
|
|
|
(209
|
)
|
|
38
|
|
|
2.2
|
|
247
|
|
|
(117
|
)
|
|
130
|
|
|
2.2
|
||||||
In-process research and development
|
29,988
|
|
|
—
|
|
|
29,988
|
|
|
n/a
|
|
—
|
|
|
—
|
|
|
—
|
|
|
n/a
|
||||||
|
$
|
111,459
|
|
|
$
|
(11,719
|
)
|
|
$
|
99,740
|
|
|
6.7
|
|
$
|
37,331
|
|
|
$
|
(6,862
|
)
|
|
$
|
30,469
|
|
|
8.2
|
2019 (remainder of year)
|
$
|
2,416
|
|
2020
|
9,939
|
|
|
2021
|
10,243
|
|
|
2022
|
8,538
|
|
|
2023
|
7,525
|
|
|
Thereafter
|
31,091
|
|
|
Total estimated future amortization expense
|
$
|
69,752
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
Leasehold improvements
|
$
|
14,049
|
|
|
$
|
13,034
|
|
Laboratory equipment
|
26,136
|
|
|
22,149
|
|
||
Equipment under capital lease
|
—
|
|
|
7,129
|
|
||
Computer equipment
|
5,454
|
|
|
4,723
|
|
||
Software
|
2,659
|
|
|
2,594
|
|
||
Furniture and fixtures
|
941
|
|
|
784
|
|
||
Automobiles
|
58
|
|
|
20
|
|
||
Construction-in-progress
|
10,585
|
|
|
1,962
|
|
||
Total property and equipment, gross
|
59,882
|
|
|
52,395
|
|
||
Accumulated depreciation and amortization
|
(27,705
|
)
|
|
(24,509
|
)
|
||
Total property and equipment, net
|
$
|
32,177
|
|
|
$
|
27,886
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
Accrued compensation and related expenses
|
$
|
12,684
|
|
|
$
|
7,917
|
|
Liabilities associated with business combinations
|
26,771
|
|
|
6,460
|
|
||
Liability associated with co-development agreement
|
—
|
|
|
2,000
|
|
||
Deferred revenue
|
1,151
|
|
|
761
|
|
||
Other
|
12,645
|
|
|
9,425
|
|
||
Total accrued liabilities
|
$
|
53,251
|
|
|
$
|
26,563
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
Lease incentive obligation, non-current
|
$
|
—
|
|
|
$
|
3,280
|
|
Deferred rent, non-current
|
—
|
|
|
5,495
|
|
||
Liabilities associated with business combinations, non-current
|
7,800
|
|
|
—
|
|
||
Other non-current liabilities
|
—
|
|
|
181
|
|
||
Total other long-term liabilities
|
$
|
7,800
|
|
|
$
|
8,956
|
|
|
September 30, 2019
|
||||||||||||||||||||||||||
|
Amortized
Cost
|
|
Unrealized
|
|
Estimated
Fair Value
|
|
|
|
|
|
|
||||||||||||||||
|
|
Gains
|
|
Losses
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Money market funds
|
$
|
452,306
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
452,306
|
|
|
$
|
452,306
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Certificates of deposit
|
300
|
|
|
—
|
|
|
—
|
|
|
300
|
|
|
—
|
|
|
300
|
|
|
—
|
|
|||||||
Total financial assets
|
$
|
452,606
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
452,606
|
|
|
$
|
452,306
|
|
|
$
|
300
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Contingent consideration
|
|
|
|
|
|
|
$
|
11,000
|
|
|
—
|
|
|
—
|
|
|
$
|
11,000
|
|
||||||||
Total financial liabilities
|
|
|
|
|
|
|
$
|
11,000
|
|
|
—
|
|
|
—
|
|
|
$
|
11,000
|
|
|
September 30, 2019
|
||
Reported as:
|
|
|
|
Cash equivalents
|
$
|
446,123
|
|
Restricted cash
|
6,183
|
|
|
Marketable securities
|
300
|
|
|
Total cash equivalents, restricted cash, and marketable securities
|
$
|
452,606
|
|
|
|
||
Accrued liabilities
|
$
|
3,200
|
|
Other long-term liabilities
|
$
|
7,800
|
|
|
December 31, 2018
|
||||||||||||||||||||||||||
|
Amortized
Cost
|
|
Unrealized
|
|
Estimated
Fair Value
|
|
|
|
|
|
|
||||||||||||||||
|
|
Gains
|
|
Losses
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Money market funds
|
$
|
93,934
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
93,934
|
|
|
$
|
93,934
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Certificates of deposit
|
300
|
|
|
—
|
|
|
—
|
|
|
300
|
|
|
—
|
|
|
300
|
|
|
—
|
|
|||||||
Commercial paper
|
10,908
|
|
|
—
|
|
|
(1
|
)
|
|
10,907
|
|
|
—
|
|
|
10,907
|
|
|
—
|
|
|||||||
U.S. treasury notes
|
9,990
|
|
|
—
|
|
|
—
|
|
|
9,990
|
|
|
9,990
|
|
|
—
|
|
|
—
|
|
|||||||
U.S. government agency securities
|
6,001
|
|
|
—
|
|
|
(4
|
)
|
|
5,997
|
|
|
—
|
|
|
5,997
|
|
|
—
|
|
|||||||
Total financial assets
|
$
|
121,133
|
|
|
$
|
—
|
|
|
$
|
(5
|
)
|
|
$
|
121,128
|
|
|
$
|
103,924
|
|
|
$
|
17,204
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Contingent consideration
|
|
|
|
|
|
|
$
|
4,998
|
|
|
—
|
|
|
—
|
|
|
$
|
4,998
|
|
||||||||
Total financial liabilities
|
|
|
|
|
|
|
$
|
4,998
|
|
|
—
|
|
|
—
|
|
|
$
|
4,998
|
|
|
December 31, 2018
|
||
Reported as:
|
|
|
|
Cash equivalents
|
$
|
101,395
|
|
Restricted cash
|
6,006
|
|
|
Marketable securities
|
13,727
|
|
|
Total cash equivalents, restricted cash, and marketable securities
|
$
|
121,128
|
|
|
|
||
Accrued liabilities
|
$
|
4,998
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Operating lease costs
|
$
|
2,666
|
|
|
$
|
2,416
|
|
|
$
|
7,747
|
|
|
$
|
7,248
|
|
Sublease income
|
(43
|
)
|
|
(39
|
)
|
|
(129
|
)
|
|
(117
|
)
|
||||
Total operating lease costs
|
2,623
|
|
|
2,377
|
|
|
7,618
|
|
|
7,131
|
|
||||
Finance lease costs
|
386
|
|
|
410
|
|
|
1,197
|
|
|
1,365
|
|
||||
Total lease costs
|
$
|
3,009
|
|
|
$
|
2,787
|
|
|
$
|
8,815
|
|
|
$
|
8,496
|
|
2019 (remainder of year)
|
$
|
2,768
|
|
2020
|
10,637
|
|
|
2021
|
10,676
|
|
|
2022
|
10,636
|
|
|
2023
|
9,912
|
|
|
Thereafter
|
28,273
|
|
|
Future non-cancelable minimum operating lease payments
|
72,902
|
|
|
Less: minimum payments to be received from non-cancelable subleases
|
(44
|
)
|
|
Total future non-cancelable minimum operating lease payments, net
|
72,858
|
|
|
Less: imputed interest
|
(23,264
|
)
|
|
Total operating lease liabilities
|
49,594
|
|
|
Less: current portion
|
(5,186
|
)
|
|
Operating lease obligations, net of current portion
|
$
|
44,408
|
|
2019 (remainder of year)
|
$
|
509
|
|
2020
|
1,355
|
|
|
Total finance lease obligations
|
1,864
|
|
|
Less: interest
|
(60
|
)
|
|
Present value of net minimum finance lease payments
|
1,804
|
|
|
Less: current portion
|
(1,636
|
)
|
|
Finance lease obligations, net of current portion
|
$
|
168
|
|
Outstanding principal
|
$
|
350,000
|
|
Unamortized debt discount and issuance costs
|
(84,806
|
)
|
|
Net carrying amount, liability component
|
$
|
265,194
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
Convertible preferred stock:
|
|
|
|
|
|
|
|
||||
Shares outstanding, beginning of period
|
125
|
|
|
3,459
|
|
|
3,459
|
|
|
3,459
|
|
Conversion into common stock
|
—
|
|
|
—
|
|
|
(3,334
|
)
|
|
—
|
|
Shares outstanding, end of period
|
125
|
|
|
3,459
|
|
|
125
|
|
|
3,459
|
|
|
|
|
|
|
|
|
|
||||
Common stock:
|
|
|
|
|
|
|
|
||||
Shares outstanding, beginning of period
|
93,763
|
|
|
68,976
|
|
|
75,481
|
|
|
53,597
|
|
Common stock issued in connection with public offering
|
786
|
|
|
4,325
|
|
|
11,136
|
|
|
17,103
|
|
Common stock issued on exercise of stock options, net
|
71
|
|
|
306
|
|
|
411
|
|
|
326
|
|
Common stock issued pursuant to vesting of RSUs
|
476
|
|
|
213
|
|
|
1,721
|
|
|
1,181
|
|
Common stock issued pursuant to exercises of warrants
|
10
|
|
|
552
|
|
|
29
|
|
|
1,098
|
|
Common stock issued pursuant to employee stock purchase plan
|
—
|
|
|
—
|
|
|
235
|
|
|
276
|
|
Common stock issued pursuant to business combinations
|
1,409
|
|
|
240
|
|
|
4,168
|
|
|
1,023
|
|
Common stock issued upon conversion of preferred stock
|
—
|
|
|
—
|
|
|
3,334
|
|
|
—
|
|
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
Shares outstanding, end of period
|
96,515
|
|
|
74,612
|
|
|
96,515
|
|
|
74,612
|
|
|
Shares Available For Grant
|
|
Stock Options Outstanding
|
|
Weighted-Average Exercise Price Per Share
|
|
Weighted-Average Remaining Contractual Life (Years)
|
|
Aggregate Intrinsic Value
|
||||||
Balances at December 31, 2018
|
118
|
|
|
3,855
|
|
|
$
|
8.54
|
|
|
6.8
|
|
$
|
9,927
|
|
Additional shares reserved
|
13,019
|
|
|
—
|
|
|
|
|
|
|
|
||||
Options granted
|
(193
|
)
|
|
193
|
|
|
24.16
|
|
|
|
|
|
|||
Options cancelled
|
33
|
|
|
(33
|
)
|
|
12.65
|
|
|
|
|
|
|||
Options exercised
|
—
|
|
|
(411
|
)
|
|
7.25
|
|
|
|
|
|
|||
RSUs and PRSUs granted(1)
|
(6,671
|
)
|
|
—
|
|
|
|
|
|
|
|
||||
RSUs and PRSUs cancelled
|
190
|
|
|
—
|
|
|
|
|
|
|
|
||||
Balances at September 30, 2019
|
6,496
|
|
|
3,604
|
|
|
$
|
9.49
|
|
|
6.3
|
|
$
|
36,158
|
|
Options exercisable at September 30, 2019
|
|
|
2,948
|
|
|
$
|
8.71
|
|
|
5.9
|
|
$
|
31,207
|
|
|
Options vested and expected to vest at September 30, 2019
|
|
|
3,516
|
|
|
$
|
9.35
|
|
|
6.3
|
|
$
|
35,603
|
|
(1)
|
Includes the Time-based RSUs and PRSUs granted as a part of the Singular Bio acquisition which are based on a fixed dollar value. The number of shares issued will be variable until the awards vest. See further details in Note 4, "Business combinations."
|
|
Number of Shares
|
|
Weighted- Average Grant Date Fair Value Per Share
|
|||
Balance at December 31, 2018
|
4,031
|
|
|
$
|
8.35
|
|
RSUs granted
|
1,436
|
|
|
$
|
21.40
|
|
Time-based RSUs and PRSUs granted - Singular Bio (1)
|
4,280
|
|
|
$
|
19.27
|
|
PRSUs granted
|
955
|
|
|
$
|
22.62
|
|
RSUs vested
|
(1,721
|
)
|
|
$
|
10.53
|
|
RSUs cancelled
|
(190
|
)
|
|
$
|
11.17
|
|
Balance at September 30, 2019
|
8,791
|
|
|
$
|
16.86
|
|
(1)
|
The Time-based RSUs and PRSUs granted as a part of the Singular Bio acquisition in June 2019 are based on a fixed dollar value. The number of shares issued and weighted-average grant date fair value per share will be variable until the awards vest. See further details in Note 4, "Business combinations."
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Expected term (in years)
|
—
|
|
6.0
|
|
6.0
|
|
6.0
|
Expected volatility
|
—%
|
|
59.63%
|
|
64.20%
|
|
59.58%
|
Risk-free interest rate
|
—%
|
|
2.82%
|
|
2.58%
|
|
2.80%
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Cost of revenue
|
$
|
822
|
|
|
$
|
747
|
|
|
$
|
3,678
|
|
|
$
|
2,320
|
|
Research and development
|
22,181
|
|
|
1,722
|
|
|
30,753
|
|
|
5,237
|
|
||||
Selling and marketing
|
1,752
|
|
|
1,172
|
|
|
5,909
|
|
|
3,690
|
|
||||
General and administrative
|
3,531
|
|
|
1,565
|
|
|
7,486
|
|
|
4,464
|
|
||||
Total stock-based compensation expense
|
$
|
28,286
|
|
|
$
|
5,206
|
|
|
$
|
47,826
|
|
|
$
|
15,711
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net loss
|
$
|
(78,707
|
)
|
|
$
|
(31,723
|
)
|
|
$
|
(165,060
|
)
|
|
$
|
(99,514
|
)
|
Shares used in computing net loss per share, basic and diluted
|
95,577
|
|
|
70,153
|
|
|
88,663
|
|
|
63,935
|
|
||||
Net loss per share, basic and diluted
|
$
|
(0.82
|
)
|
|
$
|
(0.45
|
)
|
|
$
|
(1.86
|
)
|
|
$
|
(1.56
|
)
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
Shares of common stock subject to outstanding options
|
3,647
|
|
|
4,085
|
|
|
3,691
|
|
|
4,081
|
|
Shares of common stock subject to outstanding warrants
|
586
|
|
|
1,354
|
|
|
596
|
|
|
1,718
|
|
Shares of common stock subject to outstanding RSUs
|
5,915
|
|
|
4,061
|
|
|
4,878
|
|
|
3,289
|
|
Shares of common stock subject to outstanding PRSUs
|
2,722
|
|
|
—
|
|
|
994
|
|
|
—
|
|
Shares of common stock pursuant to ESPP
|
229
|
|
|
313
|
|
|
219
|
|
|
300
|
|
Shares of common stock underlying Series A convertible preferred stock
|
125
|
|
|
3,459
|
|
|
896
|
|
|
3,459
|
|
Shares of common stock subject to convertible senior notes exercise
|
2,616
|
|
|
—
|
|
|
872
|
|
|
—
|
|
Total shares of common stock equivalents
|
15,840
|
|
|
13,272
|
|
|
12,146
|
|
|
12,847
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
United States
|
$
|
52,687
|
|
|
$
|
34,906
|
|
|
$
|
140,700
|
|
|
$
|
95,712
|
|
Canada
|
1,158
|
|
|
1,052
|
|
|
3,005
|
|
|
3,156
|
|
||||
Rest of world
|
2,666
|
|
|
1,408
|
|
|
6,834
|
|
|
3,475
|
|
||||
Total revenue
|
$
|
56,511
|
|
|
$
|
37,366
|
|
|
$
|
150,539
|
|
|
$
|
102,343
|
|
•
|
our views regarding the future of genetic testing and its role in mainstream medical practice;
|
•
|
our mission and strategy for our business, products and technology, including our ability to expand our content and develop new content while maintaining attractive pricing, further enhance our genetic testing service and the related user experience, build interest in and demand for our tests and attract potential partners;
|
•
|
the implementation of our business model;
|
•
|
the expected benefits from and our ability to integrate our acquisitions;
|
•
|
the rate and degree of market acceptance of our tests and genetic testing generally;
|
•
|
our ability to scale our infrastructure and operations in a cost‑effective manner;
|
•
|
the timing of and our ability to introduce improvements to our genetic testing platform and to expand our assays to include additional genes;
|
•
|
our expectations with respect to future hiring;
|
•
|
the timing and results of studies with respect to our tests;
|
•
|
developments and projections relating to our competitors and our industry;
|
•
|
our competitive strengths;
|
•
|
the degree to which individuals will share genetic information generally, as well as share any related potential economic opportunities with us;
|
•
|
our commercial plans, including our sales and marketing expectations;
|
•
|
our ability to obtain and maintain adequate reimbursement for our tests;
|
•
|
regulatory developments in the United States and foreign countries;
|
•
|
our ability to attract and retain key scientific or management personnel;
|
•
|
our expectations regarding our ability to obtain and maintain intellectual property protection and not infringe on the rights of others;
|
•
|
our ability to obtain funding for our operations and the growth of our business, including potential acquisitions;
|
•
|
our financial performance;
|
•
|
the impact of accounting pronouncements and our critical accounting policies, judgments, estimates and assumptions on our financial results;
|
•
|
our expectations regarding our future revenue, cost of revenue, operating expenses and capital expenditures, and our future capital requirements; and
|
•
|
the impact of tax laws on our business.
|
•
|
Expanding our content offering. We intend to continue steadily adding additional content to the Invitae platform, ultimately leading to affordable access to the personal molecular information relevant in enabling personalized medicine. The breadth and depth of our offering is a core and central contribution to an improved user experience.
|
•
|
Creating a unique user experience. A state-of-the-art interactive platform will enhance our service offering, leverage the uniquely empowering characteristics of online sharing of genetic information and, we believe, enable a superior economic offering to clients. We intend to continue to expend
|
•
|
Driving volume. We intend to increase our brand equity and visibility through excellent service and a variety of marketing and promotional techniques, including scientific publications and presentations, sales, marketing, public relations, social media and web technology vehicles. We believe that rapidly increasing the volume of customers using our platform helps us to attract partners.
|
•
|
Attracting partners. As we add more customers to our platform, we believe our business becomes particularly attractive to potential partners that can help the patients in our network further benefit from their genetic information or that provide us access to new customers who may wish to join our network. We believe the cumulative effect of the increased volume brought by these strategic components will allow us to lower the cost of our service.
|
•
|
Lowering the costs and price of genetic information. Our goal is to provide customers with a broad menu of genetic content at a reasonable price and rapid turn-around time in order to grow volume and further achieve economies of scale. As we do so and experience further cost savings, we expect that those cost savings will allow us to deliver still more comprehensive information at decreasing prices and further improve the customer experience, allowing us to experience cumulative benefits from all of the efforts outlined above.
|
1)
|
the needs of our customers;
|
2)
|
motivating our employees to serve the needs of our customers; and
|
3)
|
our long-term stockholder value.
|
|
Three Months Ended September 30,
|
|
Dollar
Change
|
|
%
Change
|
||||||||
|
2019
|
|
2018
|
|
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|||
Test revenue
|
$
|
55,502
|
|
|
$
|
36,611
|
|
|
$
|
18,891
|
|
|
52%
|
Other revenue
|
1,009
|
|
|
755
|
|
|
254
|
|
|
34%
|
|||
Total revenue
|
56,511
|
|
|
37,366
|
|
|
19,145
|
|
|
51%
|
|||
Cost of revenue
|
32,120
|
|
|
20,441
|
|
|
11,679
|
|
|
57%
|
|||
Research and development
|
46,951
|
|
|
15,776
|
|
|
31,175
|
|
|
198%
|
|||
Selling and marketing
|
32,690
|
|
|
17,591
|
|
|
15,099
|
|
|
86%
|
|||
General and administrative
|
21,733
|
|
|
13,668
|
|
|
8,065
|
|
|
59%
|
|||
Loss from operations
|
(76,983
|
)
|
|
(30,110
|
)
|
|
(46,873
|
)
|
|
156%
|
|||
Other income (expense), net
|
(7,591
|
)
|
|
231
|
|
|
(7,822
|
)
|
|
N/M
|
|||
Interest expense
|
(2,833
|
)
|
|
(1,844
|
)
|
|
(989
|
)
|
|
54%
|
|||
Net loss before taxes
|
(87,407
|
)
|
|
(31,723
|
)
|
|
(55,684
|
)
|
|
176%
|
|||
Income tax benefit
|
(8,700
|
)
|
|
—
|
|
|
(8,700
|
)
|
|
(100)%
|
|||
Net loss
|
$
|
(78,707
|
)
|
|
$
|
(31,723
|
)
|
|
$
|
(46,984
|
)
|
|
148%
|
|
Nine Months Ended September 30,
|
|
Dollar
Change
|
|
%
Change
|
||||||||
|
2019
|
|
2018
|
|
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|||
Test revenue
|
$
|
147,423
|
|
|
$
|
100,014
|
|
|
$
|
47,409
|
|
|
47%
|
Other revenue
|
3,116
|
|
|
2,329
|
|
|
787
|
|
|
34%
|
|||
Total revenue
|
150,539
|
|
|
102,343
|
|
|
48,196
|
|
|
47%
|
|||
Cost of revenue
|
81,380
|
|
|
58,964
|
|
|
22,416
|
|
|
38%
|
|||
Research and development
|
90,247
|
|
|
46,926
|
|
|
43,321
|
|
|
92%
|
|||
Selling and marketing
|
87,662
|
|
|
55,222
|
|
|
32,440
|
|
|
59%
|
|||
General and administrative
|
56,326
|
|
|
37,884
|
|
|
18,442
|
|
|
49%
|
|||
Loss from operations
|
(165,076
|
)
|
|
(96,653
|
)
|
|
(68,423
|
)
|
|
71%
|
|||
Other income (expense), net
|
(5,572
|
)
|
|
2,066
|
|
|
(7,638
|
)
|
|
(370)%
|
|||
Interest expense
|
(7,062
|
)
|
|
(4,927
|
)
|
|
(2,135
|
)
|
|
43%
|
|||
Net loss before taxes
|
(177,710
|
)
|
|
(99,514
|
)
|
|
(78,196
|
)
|
|
79%
|
|||
Income tax benefit
|
(12,650
|
)
|
|
—
|
|
|
(12,650
|
)
|
|
(100)%
|
|||
Net loss
|
$
|
(165,060
|
)
|
|
$
|
(99,514
|
)
|
|
$
|
(65,546
|
)
|
|
66%
|
|
Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
Cash used in operating activities
|
$
|
(97,787
|
)
|
|
$
|
(76,747
|
)
|
Cash provided by (used in) investing activities
|
(9,612
|
)
|
|
24,589
|
|
||
Cash provided by financing activities
|
462,430
|
|
|
141,124
|
|
||
Net increase in cash, cash equivalents and restricted cash
|
$
|
355,031
|
|
|
$
|
88,966
|
|
Contractual obligations:
|
|
Remainder of 2019
|
|
2020 and 2021
|
|
2022 and 2023
|
|
2024 and beyond
|
|
Total
|
||||||||||
Operating leases
|
|
$
|
2,768
|
|
|
$
|
21,313
|
|
|
$
|
20,548
|
|
|
$
|
28,273
|
|
|
$
|
72,902
|
|
Finance leases
|
|
509
|
|
|
1,355
|
|
|
—
|
|
|
—
|
|
|
1,864
|
|
|||||
Convertible Senior Notes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
350,000
|
|
|
350,000
|
|
|||||
Purchase commitments
|
|
417
|
|
|
4,218
|
|
|
52
|
|
|
—
|
|
|
4,687
|
|
|||||
Total
|
|
$
|
3,694
|
|
|
$
|
26,886
|
|
|
$
|
20,600
|
|
|
$
|
378,273
|
|
|
$
|
429,453
|
|
•
|
dozens of relatively specialized competitors focused on inherited clinical genetics and gene sequencing, such as Ambry Genetics, Inc., a subsidiary of Konica Minolta Inc., Athena Diagnostics, a subsidiary of Quest Diagnostics Incorporated, Baylor Genetics, Blueprint Genetics, Inc., Centogene AG, Color Genomics, Inc., Connective Tissue Gene Test LLC, a subsidiary of Health Network Laboratories, L.P., Cooper Surgical, Inc., Eurofins Scientific, GeneDx, a subsidiary of OPKO Health, Inc., MNG Laboratories, LLC, Myriad Genetics, Inc., Natera, Inc., Perkin Elmer, Inc., PreventionGenetics, LLC, Progenity, Inc. and Sema4 Genomics;
|
•
|
a few large, established general testing companies with large market share and significant channel power, such as Laboratory Corporation of America Holdings and Quest Diagnostics Incorporated;
|
•
|
a large number of clinical laboratories in an academic or healthcare provider setting that perform clinical genetic testing on behalf of their affiliated institutions and often sell and market more broadly; and
|
•
|
a large number of new entrants into the market for genetic information ranging from informatics and analysis pipeline developers to focused, integrated providers of genetic tools and services for health and wellness including Illumina, Inc., which is also one of our suppliers.
|
•
|
breadth and depth of content;
|
•
|
quality;
|
•
|
reliability;
|
•
|
accessibility of results;
|
•
|
turnaround time of testing results;
|
•
|
price and quality of tests;
|
•
|
coverage and reimbursement arrangements with third-party payers;
|
•
|
convenience of testing;
|
•
|
brand recognition of test provider;
|
•
|
additional value-added services and informatics tools;
|
•
|
client service; and
|
•
|
quality of website content.
|
•
|
conduct research and development;
|
•
|
further develop and scale our laboratory processes; and
|
•
|
further develop and scale our infrastructure to be able to analyze increasingly larger and more diverse amounts of data.
|
•
|
failure of any test to perform as expected;
|
•
|
lack of validation or reference data; or
|
•
|
failure to demonstrate utility of a test.
|
•
|
multiple, conflicting and changing laws and regulations such as privacy regulations, tax laws, export and import restrictions, employment laws, regulatory requirements, and other governmental approvals, permits and licenses;
|
•
|
failure by us or our distributors to obtain regulatory approvals for the use of our tests in various countries;
|
•
|
complexities and difficulties in obtaining protection and enforcing our intellectual property;
|
•
|
difficulties in staffing and managing foreign operations;
|
•
|
complexities associated with managing multiple payer reimbursement regimes, government payers or patient self-pay systems;
|
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logistics and regulations associated with shipping samples, including infrastructure conditions and transportation delays;
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limits on our ability to penetrate international markets if we do not to conduct our tests locally;
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natural disasters, political and economic instability, including wars, terrorism and political unrest, outbreak of disease, boycotts, curtailment of trade and other business restrictions; and
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regulatory and compliance risks that relate to maintaining accurate information and control over activities that may fall within the purview of the U.S. Foreign Corrupt Practices Act, or FCPA, its books and records provisions, or its anti-bribery provisions.
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HIPAA, which establish comprehensive federal standards with respect to the privacy and security of protected health information and requirements for the use of certain standardized electronic transactions;
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amendments to HIPAA under HITECH, which strengthen and expand HIPAA privacy and security compliance requirements, increase penalties for violators and expand vicarious liability, extend enforcement authority to state attorneys general, and impose requirements for breach notification;
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the federal Anti-Kickback Statute, which prohibits knowingly and willfully offering, paying, soliciting or receiving remuneration, directly or indirectly, overtly or covertly, in cash or in kind, to induce or in return for the referral of an individual, for the furnishing of or arrangement for the furnishing of any item or service for which payment may be made in whole or in part by a federal healthcare program, or the purchasing, leasing, ordering, arranging for, or recommend purchasing, leasing or ordering, any good, facility, item or service for which payment may be made, in whole or in part, under a federal healthcare program;
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the Eliminating Kickbacks in Recovery Act of 2018, known as EKRA, which prohibits payments for referrals to recovery homes, clinical treatment facilities, and laboratories and reaches beyond federal health care programs, to include private insurance;
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the federal physician self-referral law, known as the Stark Law, which prohibits a physician from making a referral to an entity for certain designated health services covered by the Medicare program, including laboratory and pathology services, if the physician or an immediate family member has a financial relationship with the entity unless an exception applies, and prohibits an entity from billing for designated health services furnished pursuant to a prohibited referral;
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the federal false claims law, which impose liability on any person or entity that, among other things, knowingly presents, or causes to be presented, a false or fraudulent claim for payment to the federal government;
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the federal Civil Monetary Penalties Law, which prohibits, among other things, the offering or transfer of remuneration to a Medicare or state healthcare program beneficiary if the person knows or should know it is likely to influence the beneficiary’s selection of a particular provider, practitioner or supplier of services reimbursable by Medicare or a state healthcare program, unless an exception applies;
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the HIPAA fraud and abuse provisions, which create new federal criminal statutes that prohibit, among other things, defrauding health care benefit programs, willfully obstructing a criminal investigation of a healthcare offense and falsifying or concealing a material fact or making any materially false statements in connection with the payment for healthcare benefits, items or services;
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other federal and state fraud and abuse laws, such as anti-kickback laws, prohibitions on self-referral, fee-splitting restrictions, insurance fraud laws, anti-markup laws, prohibitions on the provision of tests at no or discounted cost to induce physician or patient adoption, and false claims acts, which may extend to services reimbursable by any third-party payer, including private insurers;
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the prohibition on reassignment of Medicare claims, which, subject to certain exceptions, precludes the reassignment of Medicare claims to any other party;
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state laws that prohibit other specified practices, such as billing clinicians for testing that they order; waiving coinsurance, copayments, deductibles and other amounts owed by patients; billing a state Medicaid program at a price that is higher than what is charged to one or more other payers; and
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similar foreign laws and regulations that apply to us in the countries in which we operate or may operate in the future.
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actual or anticipated fluctuations in our operating results;
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competition from existing tests or new tests that may emerge;
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announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments;
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failure to meet or exceed financial estimates and projections of the investment community or that we provide to the public;
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issuance of new or updated research or reports by securities analysts or changed recommendations for our stock;
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our focus on long-term goals over short-term results;
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the timing of our investments in the growth of our business;
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actual or anticipated changes in regulatory oversight of our business;
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additions or departures of key management or other personnel;
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disputes or other developments related to our intellectual property or other proprietary rights, including litigation;
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changes in reimbursement by current or potential payers;
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general economic and market conditions; and
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issuances of significant amounts of our common stock.
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authorize our board of directors to issue, without further action by the stockholders, up to 20,000,000 shares of undesignated preferred stock;
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require that any action to be taken by our stockholders be effected at a duly called annual or special meeting and not by written consent;
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specify that special meetings of our stockholders can be called only by our board of directors, our chairman of the board or our chief executive officer;
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establish an advance notice procedure for stockholder approvals to be brought before an annual meeting of our stockholders, including proposed nominations of persons for election to our board of directors;
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establish that our board of directors is divided into three classes, Class I, Class II and Class III, with each class serving staggered terms;
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provide that our directors may be removed only for cause;
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provide that vacancies on our board of directors may, except as otherwise required by law, be filled only by a majority of directors then in office, even if less than a quorum; and
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require a super-majority of votes to amend certain of the above-mentioned provisions as well as to amend our bylaws generally.
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any derivative action or proceeding brought on our behalf;
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any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers, or other employees to us or our stockholders;
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any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law; or
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any action asserting a claim against us governed by the internal affairs doctrine.
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Exhibit Number
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Description
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2.1+
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4.1
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10.1
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31.1
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31.2
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32.1*
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32.2*
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101.INS
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Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
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101.SCH
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Inline XBRL Taxonomy Extension Schema
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101.CAL
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Inline XBRL Taxonomy Extension Calculation Linkbase
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101.DEF
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Inline XBRL Taxonomy Extension Definition Linkbase
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101.LAB
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Inline XBRL Taxonomy Extension Label Linkbase
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101.PRE
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Inline XBRL Taxonomy Extension Presentation Linkbase
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104
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Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document).
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+
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The schedules and exhibits to this agreement have been omitted pursuant to Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished to the SEC upon request.
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*
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In accordance with Item 601(b)(32)(ii) of Regulation S-K and SEC Release No. 34-47986, the certifications furnished in Exhibits 32.1 and 32.2 hereto are deemed to accompany this Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or deemed to be incorporated by reference into any filing under the Exchange Act or the Securities Act of 1933 except to the extent that the registrant specifically incorporates it by reference.
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INVITAE CORPORATION
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By:
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/s/ Sean E. George, Ph.D.
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Sean E. George, Ph.D.
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President and Chief Executive Officer
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Principal Executive Officer
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By:
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/s/ Shelly D. Guyer
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Shelly D. Guyer
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Chief Financial Officer
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Principal Financial and Accounting Officer
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Date: November 6, 2019
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