0001274737-23-000049 | 10-Q | XBRL Viewer

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Other Financial Information - Prepaid Expenses (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Other Financial Information [Abstract]
Diagnostic testing supplies	$ 1,736	$ 1,795
Prepaid product royalties	39	40
Prepaid maintenance and insurance contracts	2,210	2,072
Other prepaid expenses and other current assets	244	236
Prepaid expenses and other current assets	$ 4,229	$ 4,143

Unaudited Condensed Statements of Stockholders' Equity - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Accumulated Deficit
Beginning balance (in shares) at Dec. 31, 2021		16,164,994
Beginning balance at Dec. 31, 2021	$ 84,936	$ 16	$ 293,060	$ (208,140)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of stock from vested restricted stock units and payment of employees' taxes (in shares)		30,523
Issuance of stock from vested restricted stock units	(115)		(115)
Issuance of stock under Employee Stock Purchase Plan (in shares)		35,681
Issuance of stock under Employee Stock Purchase Plan	231		231
Stock-based compensation	1,376		1,376
Net loss	(10,272)			(10,272)
Ending balance (in shares) at Mar. 31, 2022		16,231,198
Ending balance at Mar. 31, 2022	$ 76,156	$ 16	294,552	(218,412)
Beginning balance (in shares) at Dec. 31, 2022	16,549,984	16,549,984
Beginning balance at Dec. 31, 2022	$ 42,460	$ 17	297,970	(255,527)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of stock from vested restricted stock units and payment of employees' taxes (in shares)		113,378
Issuance of stock from vested restricted stock units	0		0
Issuance of stock under Employee Stock Purchase Plan (in shares)		70,317
Issuance of stock under Employee Stock Purchase Plan	152		152
Exercise of stock options (in shares)		93,335
Exercise of stock options	27		27
Stock-based compensation	986		986
Net loss	$ (7,688)			(7,688)
Ending balance (in shares) at Mar. 31, 2023	16,827,014	16,827,014
Ending balance at Mar. 31, 2023	$ 35,937	$ 17	$ 299,135	$ (263,215)

Stock Option Plan (Tables)

3 Months Ended

Mar. 31, 2023

Share-Based Payment Arrangement [Abstract]

Schedule of Stock Option Activity

Stock option activity under the Company's 2019 Plan is set forth below:


	Number of Options	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in thousands)
Outstanding, December 31, 2022	1,421,235	$	12.94	7.09	$	483
Granted	—	$	—
Exercised	(93,335)	$	0.26
Forfeited	(31,019)	$	14.36
Expired	(277,805)	$	17.96
Outstanding, March 31, 2023	1,019,076	$	12.68	6.97	$	287
Vested and expected to vest, March 31, 2023	1,019,076	$	12.68	6.97	$	287
Options exercisable, March 31, 2023	804,742	$	12.80	6.64	$	287

Schedule of Restricted Stock Unit Activity

Restricted stock unit activity under the Company's 2019 Plan is set forth below:


	Number of Shares	Weighted- Average Grant Date Fair Value		Aggregate Intrinsic Value (in thousands)
Outstanding, December 31, 2022	1,036,208	$	7.28	$	2,487
Awards granted	638,500	$	2.30
Awards released	(113,720)	$	11.27
Awards canceled	(66,903)	$	11.37
Outstanding, March 31, 2023	1,494,085	$	4.66	$	3,631

Schedule of Non-cash Stock-based Compensation Expense

Total non-cash stock-based compensation expense recorded related to options granted, restricted stock units granted and stock purchase rights granted under the ESPP in the condensed statements of operations is as follows (in thousands):


	Three Months Ended March 31,
	2023		2022
Costs of revenue	$	53	$	44
Selling, general and administrative	831		1,118
Research and development	102		214
Total	$	986	$	1,376

Organization (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022	Mar. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Cash and cash equivalents	$ 52,184	$ 62,391	$ 89,751
Accumulated deficit	$ (263,215)	$ (255,527)

Other Financial Information - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Other Financial Information [Abstract]
Depreciation and amortization	$ 0.6	$ 0.3

Commitment and Contingencies (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended
	May 31, 2021	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2021
Loss Contingencies [Line Items]
Purchase obligation, due in year one				$ 6.9
Purchase obligation, due in second year				$ 8.0
Annual increase in purchase commitments				15.00%
Licensing Agreements \| Minimum
Loss Contingencies [Line Items]
Royalty obligation, percent of net sales		1.50%
Licensing Agreements \| Maximum
Loss Contingencies [Line Items]
Royalty obligation, percent of net sales		7.00%
AHN Collaboration
Loss Contingencies [Line Items]
Collaboration agreement, collaboration expenses		$ 0.1	$ 0.1
Prometheus Laboratories
Loss Contingencies [Line Items]
Future minimum royalty commitment		1.2
Advance royalties payment		$ 0.1
Prometheus Laboratories \| Minimum
Loss Contingencies [Line Items]
Royalty obligation, percent of net sales		2.50%
Allegheny Health Network Research Institute
Loss Contingencies [Line Items]
Collaboration fee	$ 0.4

Borrowings - Future Minimum Payments (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Debt Disclosure [Abstract]
2023 (remaining)	$ 1,498
2024	3,279
2025	16,451
2026	15,037
Total	36,265
Unamortized debt discount and issuance costs	(145)
Interest	(6,774)
Total borrowings, net of discounts and debt issuance costs	29,346
Less: Borrowings-current portion	(254)	$ (190)
Borrowings-non-current portion, net of discounts and debt issuance costs	$ 29,092	$ 28,778

Summary of Significant Accounting Policies - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Disaggregation of Revenue [Line Items]
Revenue	$ 11,230	$ 10,394
Commercial
Disaggregation of Revenue [Line Items]
Revenue	4,215	6,423
Government
Disaggregation of Revenue [Line Items]
Revenue	4,426	2,120
Client
Disaggregation of Revenue [Line Items]
Revenue	2,407	1,591
Other
Disaggregation of Revenue [Line Items]
Revenue	$ 182	$ 260

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

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+ Details

Other Financial Information - Property and Equipment (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 13,934	$ 13,321
Less: accumulated depreciation and amortization	(5,670)	(5,124)
Property and equipment, net	8,264	8,197
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Total property and equipment	98	98
Laboratory equipment
Property, Plant and Equipment [Line Items]
Total property and equipment	5,209	5,136
Computer equipment and software
Property, Plant and Equipment [Line Items]
Total property and equipment	1,548	1,482
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total property and equipment	5,223	5,223
Construction in progress
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 1,856	$ 1,382

Stock Option Plan - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 986	$ 1,376
Costs of revenue
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	53	44
Selling, general and administrative
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	831	1,118
Research and development
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 102	$ 214

Stockholders' Equity - Schedule of Outstanding Warrants (Details)	Mar. 31, 2023 $ / shares shares
Class of Stock [Line Items]
Warrants issued to purchase redeemable convertible preferred stock (in shares)	1,214,059
Warrant expiration January 19, 2026
Class of Stock [Line Items]
Warrants issued to purchase redeemable convertible preferred stock (in shares)	237,169
Class of warrant or right, exercise price of warrants or rights (in dollars per share) \| $ / shares	$ 1.84
Warrant expiration March 31, 2026
Class of Stock [Line Items]
Warrants issued to purchase redeemable convertible preferred stock (in shares)	67,086
Class of warrant or right, exercise price of warrants or rights (in dollars per share) \| $ / shares	$ 1.84
Warrant expiration April 1, 2026
Class of Stock [Line Items]
Warrants issued to purchase redeemable convertible preferred stock (in shares)	131
Class of warrant or right, exercise price of warrants or rights (in dollars per share) \| $ / shares	$ 1.84
Warrant expiration September 7, 2024
Class of Stock [Line Items]
Warrants issued to purchase redeemable convertible preferred stock (in shares)	83,778
Class of warrant or right, exercise price of warrants or rights (in dollars per share) \| $ / shares	$ 14.32
Warrant expiration December 7, 2025
Class of Stock [Line Items]
Warrants issued to purchase redeemable convertible preferred stock (in shares)	20,944
Class of warrant or right, exercise price of warrants or rights (in dollars per share) \| $ / shares	$ 14.32
No expiration
Class of Stock [Line Items]
Warrants issued to purchase redeemable convertible preferred stock (in shares)	804,951
Class of warrant or right, exercise price of warrants or rights (in dollars per share) \| $ / shares	$ 0.001

Borrowings (Tables)

3 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

Schedule of Future Minimum Aggregate Payments for Outstanding Borrowings

As of March 31, 2023, future minimum aggregate payments, including interest, for outstanding borrowings under the 2017 Loan Amendment are as follows (in thousands):



2023 (remaining)	$	1,498
2024	3,279
2025	16,451
2026	15,037
Total	36,265
Less:
Unamortized debt discount and issuance costs	(145)
Interest	(6,774)
Total borrowings, net of discounts and debt issuance costs	29,346
Less: Borrowings-current portion	(254)
Borrowings-non-current portion, net of discounts and debt issuance costs	$	29,092

Unaudited Condensed Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 52,184	$ 62,391
Accounts receivable, net	9,303	6,077
Prepaid expenses and other current assets	4,229	4,143
Total current assets	65,716	72,611
Property and equipment, net	8,264	8,197
Operating lease right-of-use assets	4,651	4,885
Other assets	603	528
Total assets	79,234	86,221
Current liabilities:
Accounts payable	1,878	3,046
Accrued and other current liabilities	6,064	5,347
Operating lease liabilities	1,072	1,040
Borrowings-current portion	254	190
Total current liabilities	9,268	9,623
Borrowings-non-current portion, net of discounts and debt issuance costs	29,092	28,778
Non-current operating lease liabilities	4,211	4,493
Other non-current liabilities	726	867
Total liabilities	43,297	43,761
Commitments and contingencies (Note 5)
Stockholders' equity:
Preferred stock, $0.001 par value; 10,000,000 shares authorized, no shares issued or outstanding as of March 31, 2023 and December 31, 2022	0	0
Common stock, $0.001 par value; 200,000,000 shares authorized as of March 31, 2023 and December 31, 2022; 16,827,014 and 16,549,984 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively	17	17
Additional paid-in capital	299,135	297,970
Accumulated deficit	(263,215)	(255,527)
Total stockholders' equity	35,937	42,460
Total liabilities and stockholders' equity	$ 79,234	$ 86,221

Summary of Significant Accounting Policies - Securities (Details) - shares	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Class of Stock [Line Items]
Anti-dilutive securities excluded from computation (in shares)	2,937,005	3,296,651
Warrants to purchase common stock
Class of Stock [Line Items]
Anti-dilutive securities excluded from computation (in shares)	409,108	409,108
Common stock options
Class of Stock [Line Items]
Anti-dilutive securities excluded from computation (in shares)	1,019,076	2,002,039
Restricted stock units
Class of Stock [Line Items]
Anti-dilutive securities excluded from computation (in shares)	1,494,085	878,575
Employee stock purchase plan
Class of Stock [Line Items]
Anti-dilutive securities excluded from computation (in shares)	14,736	6,929

Unaudited Condensed Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash flows from operating activities:
Net loss	$ (7,688)	$ (10,272)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	553	283
Amortization of debt discount and debt issuance costs	42	38
Non-cash interest expense	137	135
Loss on disposal of assets	55	0
Non-cash lease expense	234	219
Stock-based compensation	986	1,376
Changes in assets and liabilities:
Accounts receivable, net	(3,226)	(1,257)
Prepaid expenses and other current assets	(86)	664
Other assets	(79)	(273)
Operating lease liabilities	(250)	(155)
Accounts payable	(1,320)	579
Accrued and other current liabilities	893	89
Net cash used in operating activities	(9,749)	(8,574)
Cash flows from investing activities:
Purchases of property and equipment	(396)	(1,087)
Net cash used in investing activities	(396)	(1,087)
Cash flows from financing activities:
Proceeds from exercise of stock options	27	0
Payments of taxes withheld on vested restricted stock units	0	(115)
Proceeds from common stock issued under Employee Stock Purchase Plan	152	231
Principal payments on finance lease obligations	(189)	(146)
Principal payment on note payable obligations	(52)	0
Net cash used in financing activities	(62)	(30)
Net change in cash, cash equivalents and restricted cash	(10,207)	(9,691)
Cash, cash equivalents and restricted cash, beginning of period	62,591	99,542
Cash, cash equivalents and restricted cash, end of period	52,384	89,851
Supplemental disclosure of cash flow information:
Cash paid for interest	449	424
Supplemental disclosure of non-cash items:
Equipment purchased under notes payable obligations	250	0
Costs incurred, but not paid, in connection with capital expenditures	$ 199	$ 1,672

Borrowings

3 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

Borrowings

2017 Term Loan

In September 2017, the Company executed a term loan agreement (the 2017 Term Loan) with Innovatus Life Sciences Lending Fund I, LP (Innovatus), as amended, pursuant to which the Company borrowed $25.0 million. As of March 31, 2023, no additional amounts remained available to borrow under the 2017 Term Loan.

In November 2021, the Company executed the Second Amendment to the Loan and Security Agreement (the 2017 Loan Amendment) and, as further described in Note 9, on April 28, 2023, the Company and Innovatus entered into

the Third Loan Amendment to the 2017 Term Loan (Third Loan Amendment). The interest rate on all borrowings under the 2017 Loan Amendment was 8.0%, of which 2.0% was paid in-kind in the form of additional term loans (PIK Loans) until December of 2024, after which interest was scheduled to accrue at an annual rate of 8.0%. The Company estimated the effective interest rate of this loan to be approximately 8.5%. Accrued interest is due and payable monthly, unless the Company elects to pay paid-in-kind interest. The outstanding principal and accrued interest on the 2017 Loan Amendment was to be repaid in twenty-four equal monthly installments commencing in December 2024. Upon repayment of the final installment under the 2017 Loan Amendment, the Company is required to pay an additional fee of $1.0 million. This obligation is being accreted into interest expense over the term of the Loan Amendment using the effective interest method. For each of the three months ended March 31, 2023 and 2022, the Company issued PIK Loans totaling $0.1 million.

The 2017 Loan Amendment required a prepayment premium of 2% of the aggregate outstanding principal and decreased by 1% on each of November 1, 2023 and 2024.

The 2017 Loan Amendment is collateralized by a first priority security interest in substantially all of the Company's assets, including intellectual property. The affirmative covenants of the 2017 Loan Amendment require that the Company timely file taxes, maintain good standing and government compliance, maintain liability and other insurance, provide prompt notification of significant corporate events, and furnish audited financial statements within 150 days of fiscal year end without qualification as to the scope of the audit or as to going concern and without any other similar qualification.

The affirmative covenants require that the Company achieve a specified level of revenue, as measured quarterly on a rolling twelve-month basis. The consequences of failing to achieve the performance covenant were eligible to be cured if, within sixty days of failing to achieve the performance covenant, the Company issues additional equity securities or subordinated debt with net proceeds sufficient to fund any cash flow deficiency generated from operations, as defined. The 2017 Loan Amendment requires that the Company maintain certain levels of minimum liquidity and maintains an unrestricted cash balance of $2.0 million.

The negative covenants provide, among other things, that without the prior consent of Innovatus, subject to certain exceptions, the Company may not dispose of certain assets, engage in certain business combinations or acquisitions, incur additional indebtedness or encumber any of the Company's property, pay dividends on the Company's capital stock or make prohibited investments. The Loan Amendment agreement provides that an event of default will occur if, among other triggers, (i) the Company defaults in the payment of any amount payable under the agreement when due, (ii) there occurs any circumstance(s) that could reasonably be expected to result in a material adverse effect on the Company's business, operations or condition, or on the Company's ability to perform its obligations under the agreement, (iii) the Company becomes insolvent, (iv) the Company undergoes a change in control or (v) the Company breaches any negative covenants or certain affirmative covenants in the agreement or, subject to a cure period, otherwise neglects to perform or observe any material item in the agreement.

As of March 31, 2023, the Company was in compliance with all covenants of the 2017 Loan Amendment.

Upon an event of default in any of the 2017 Loan Amendment covenants, the repayment of the 2017 Loan Amendment may be accelerated, and the applicable interest rate will be increased by 4.0% until the default is cured. Although repayment of the 2017 Loan Amendment can be accelerated under certain circumstances, the Company believes acceleration of this loan is not probable as of the date of these condensed financial statements. Accordingly, the Company has reflected the amounts of the 2017 Loan Amendment due beyond twelve months of the balance sheet date as non-current.

2022 Equipment Notes Payable

In May 2022, the Company purchased laboratory equipment using notes payable. At March 31, 2023, the total notes payable balance related to this financed equipment was $1.0 million, with $0.3 million classified within borrowings-current portion and $0.7 million within borrowings-non-current portion, net of discounts and debt issuance costs in the accompanying balance sheets. The financed equipment is subject to a 5.28% effective interest rate and will mature on October 1, 2026.

Future Minimum Payments on the Outstanding Borrowings

As of March 31, 2023, future minimum aggregate payments, including interest, for outstanding borrowings under the 2017 Loan Amendment are as follows (in thousands):



2023 (remaining)	$	1,498
2024	3,279
2025	16,451
2026	15,037
Total	36,265
Less:
Unamortized debt discount and issuance costs	(145)
Interest	(6,774)
Total borrowings, net of discounts and debt issuance costs	29,346
Less: Borrowings-current portion	(254)
Borrowings-non-current portion, net of discounts and debt issuance costs	$	29,092

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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-Topic 470
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-Section 50
-Paragraph 1B
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (i)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

+ Details

Stock Option Plan - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Intrinsic value		$ 0.2
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)	0	0
Stock options, unrecognized compensation cost	$ 1.1
Stock options, cost not yet recognized, remaining weighted average vesting period	9 months 25 days
Employee stock purchase plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized, percentage	1.00%
Shares that remain available for future awards (in shares)	508,608
Maximum employee payroll deduction percentage	20.00%
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options, vesting period	4 years
Stock options, unrecognized compensation cost	$ 6.2
Aggregate intrinsic value, vested	$ 0.3	$ 0.3
Awards granted, Weighted-Average Grant Date Fair Value (in dollars per share)	$ 2.30	$ 8.72
Stock options, cost not yet recognized, remaining weighted average vesting period	3 years 6 months
2019 Incentive Award Plan \| Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options, expiration period	10 years
Stock options, vesting period	4 years
Shares authorized, percentage	4.00%
Shares that remain available for future awards (in shares)	1,851,836

Cover - shares	3 Months Ended
Cover - shares	Mar. 31, 2023	May 11, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2023
Document Transition Report	false
Entity File Number	001-39049
Entity Registrant Name	EXAGEN INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	20-0434866
Entity Address, Address Line One	1261 Liberty Way
Entity Address, City or Town	Vista,
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92081
City Area Code	(760)
Local Phone Number	560-1501
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	XGN
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding (in shares)		16,825,696
Entity Central Index Key	0001274737
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Amendment Flag	false

Summary of Significant Accounting Policies (Policies)	3 Months Ended
Summary of Significant Accounting Policies (Policies)	Mar. 31, 2023
Accounting Policies [Abstract]
Concentration of Credit Risk and Other Risk and Uncertainties	Concentration of Credit Risk and Other Risk and Uncertainties Financial instruments that potentially subject the Company to credit risk consist principally of cash, cash equivalents and accounts receivable. Substantially all the Company's cash and cash equivalents are held at one financial institution that management believes is of high credit quality. Such deposits may, at times, exceed federally insured limits. The Company has not experienced any losses on its cash or cash equivalents.
Fair Value Measurements	Fair Value Measurements The carrying value of the Company's cash, cash equivalents and restricted cash, accounts receivable, prepaid expenses and other current assets, accounts payable and accrued and other current liabilities approximate their fair values due to their short-term nature, which are determined to be a Level 1 measurement (see Note 6). The estimated fair value of the Company's long-term borrowings is determined by Level 2 inputs and based primarily on quoted market prices for the same or similar issues. As of March 31, 2023, the 2017 Term Loan (as defined below) had a carrying value of $28.4 million and a fair value of $27.1 million. As of December 31, 2022, the 2017 Term Loan had a carrying value of $28.3 million and a fair value of $26.9 million The estimated fair value of the 2017 Term Loan, was determined based on a discounted cash flow approach using available market information on discount and borrowing rates with similar terms, maturities, and credit ratings. The recorded value of the Company's other long-term borrowing was $0.7 million and approximated its fair value as of March 31, 2023.
Cash, Cash Equivalents and Restricted Cash	Cash, Cash Equivalents and Restricted Cash The Company considers all highly-liquid investments purchased with a remaining maturity date of three months or less upon acquisition to be cash equivalents. These investments are stated at cost, which approximates fair value.
Long-lived Assets	Long-lived Assets The Company’s long-lived assets are comprised principally of its property and equipment and operating lease assets. The Company amortizes all finite lived intangible assets over their respective estimated useful lives. Operating lease assets are amortized over the term of the leases. In considering whether long-lived assets are impaired, we combine our intangible assets and other long-lived assets, into groupings, a determination which we principally make on the basis of whether the assets are specific to a particular test we offer or technology we are developing. If the Company identifies a change in the circumstances related to its long-lived assets that indicates the carrying value of any such asset may not be recoverable, the Company will perform an impairment analysis. A long-lived asset is deemed to be impaired when the undiscounted cash flows expected to be generated by the asset (or asset group) are less than the asset’s carrying amount. Management’s estimates of future cash flows are impacted by projected test volume and levels of reimbursement, as well as expectations related to the future cost structure of the entity. Any required impairment loss would be measured as the amount by which the asset’s carrying value exceeds its fair value, and would be recorded as a reduction in the carrying value of the related asset and a charge to operating expense.
Revenue Recognition	Revenue Recognition Substantially all of the Company's revenue has been derived from sales of its testing products and is primarily comprised of a high volume of relatively low-dollar transactions. The Company primarily markets its testing products to rheumatologists and their physician assistants in the United States. The healthcare professionals who order the Company's testing products and to whom test results are reported are generally not responsible for payment for these products. The parties that pay for these services (each, a payor) consist of commercial payors (healthcare insurers), government payors (primarily Medicare and Medicaid), client payors (i.e., hospitals, other laboratories, etc.) and patient self-pay. The Company's service is a single performance obligation that is completed upon the delivery of test results to the prescribing physician which triggers revenue recognition. Payors are billed at the Company's list price. Net revenues recognized consist of amounts billed net of allowances for differences between amounts billed and the estimated consideration the Company expects to receive from such payors. The process for estimating revenues and the ultimate collection of accounts receivable involves significant judgment and estimation. The Company follows a standard process, which considers historical denial and collection experience, insurance reimbursement policies and other factors, to estimate allowances and implicit price concessions. Adjustments are recorded in the current period as changes in estimates occur. Further adjustments to the allowances, based on actual receipts, are recorded upon settlement. Included in revenues for the three months ended March 31, 2023 and 2022 was a $0.3 million net revenue increase and a $0.2 million net revenue decrease, respectively, associated with changes in estimated variable consideration related to performance obligations satisfied in previous periods. The transaction price is estimated using an expected value method on a portfolio basis. Variable consideration is included in the transaction price only to the extent it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainties with respect to the amount are resolved. The Company's portfolios are grouped per payor (i.e. each individual commercial payor, Medicare, Medicaid, client payors, patient self-pay, etc.) and per test. Consideration may be constrained and excluded from the transaction price in situations where there is no contractually agreed upon reimbursement coverage or in absence of a predictable pattern and history of collectability with a payor. Accordingly, in such situations revenues are recognized on the basis of actual cash collections. Additionally, from time to time, the Company may issue refunds to payors for overpayments or amounts billed in error. Any refunds are accounted for as reductions in revenues in the statement of operations as an element of variable consideration. The estimated expected refunds are accrued as a liability on the Company’s balance sheet. Collection of the Company's net revenues from payors is normally a function of providing complete and correct billing information to the healthcare insurers and generally occurs within 30 to 90 days of billing. Contracts do not contain significant financing components based on the typical period of time between performance of services and collection of consideration.
Research and Development	Research and Development Costs associated with research and development activities are expensed as incurred and include, but are not limited to, personnel-related expenses, including stock-based compensation expense, materials, laboratory supplies, consulting costs, costs associated with setting up and conducting clinical studies and allocated overhead including rent and utilities.
Advertising and Marketing Costs	Advertising and Marketing Costs Costs associated with advertising and marketing activities are expensed as incurred. Total advertising and marketing costs were approximately $0.3 million for the three months ended March 31, 2023 and 2022, and are included in selling, general and administrative expenses in the accompanying condensed statements of operations.
Shipping and Handling Costs	Shipping and Handling Costs Costs incurred for shipping and handling are included in costs of revenue in the accompanying condensed statements of operations and totaled approximately $0.7 million and $0.6 million for the three months ended March 31, 2023 and 2022, respectively.
Stock-Based Compensation	Stock-Based Compensation The Company recognizes compensation expense for all stock-based awards to employees and directors based on the grant-date estimated fair values over the requisite service period of the awards (usually the vesting period) on a straight-line basis. The fair value of stock options and purchases under the Company's 2019 Employee Stock Purchase Plan (ESPP) rights is determined using the Black-Scholes-Merton (BSM) option pricing model, which requires management to make certain assumptions regarding a number of complex and subjective variables. Equity award forfeitures are recorded as they occur. The BSM option pricing model incorporates various inputs, including the fair value of the Company's common stock, expected volatility, expected term and risk-free interest rates. Volatility is based on the Company's historical calculated volatility since being publicly traded. The weighted-average expected term of options was calculated using the simplified method. The risk-free interest rate for periods within the contractual term of the option is based on the U.S. Treasury yield in effect at the time of grant. The dividend yield is zero, as the Company has never declared or paid dividends and has no plans to do so in the foreseeable future. The fair value of each restricted stock unit is determined on the grant date using the closing price of the Company's common stock on that date. The Company's restricted stock units generally vest in equal annual installments over four years from the date of grant or, for grants to new hires, date of hire. Vesting of restricted stock units is subject to the holder's continued service with the Company. The Company issues new shares to satisfy restricted stock units upon vesting.
Comprehensive Loss	Comprehensive Loss Comprehensive loss is defined as a change in equity of a business enterprise during a period, resulting from transactions from nonowner sources. There have been no items qualifying as other comprehensive loss and, therefore, for all periods presented, the Company's comprehensive loss was the same as its reported net loss.
Net Loss Per Share	Net Loss Per Share Basic net loss per share attributable to common stockholders is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common stock equivalents outstanding for the period determined using the treasury-stock and if-converted methods. The weighted-average number of shares used to compute basic and diluted shares includes shares issuable upon the exercise of pre-funded warrants at a nominal price. Potentially dilutive common stock equivalents are comprised of warrants for the purchase of common stock, stock options, restricted stock units outstanding under the Company's 2019 Incentive Award Plan (the 2019 Plan) and shares of the Company's common stock pursuant to the ESPP. For the three months ended March 31, 2023 and 2022, there is no difference in the number of shares used to calculate basic and diluted shares outstanding, as the inclusion of the potentially dilutive securities would be antidilutive.
Segment Reporting	Segment Reporting Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. The Company views its operations as, and manages its business in, one operating segment.
Recent Accounting Pronouncements and Recently Adopted Accounting Standards	Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (FASB), or other standard setting bodies and adopted by the Company as of the specified effective date. Under the Jumpstart Our Business Startups Act of 2012 (JOBS Act), the Company meets the definition of an emerging growth company. The Company has elected to use the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act. Unless otherwise discussed, the impact of recently issued standards that are not yet effective will not have a material impact on the Company's financial position or results of operations upon adoption. Recently Adopted Accounting Standards In June 2016, the FASB issued Accounting Standards Update (ASU) 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which requires the measurement of expected credit losses (based on historical experience, current conditions and reasonable forecasts) for financial instruments (such as accounts receivable) held at the reporting date which are carried at amortized cost. The main objective of this ASU is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. In November 2018, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financing Instruments-Credit Losses, which included an amendment of the effective date for nonpublic entities. For emerging growth companies, ASU 2016-13 is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company adopted this pronouncement on January 1, 2023. The adoption did not have an impact on its condensed financial statements. In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40). ASU 2020-06 eliminates the beneficial conversion and cash conversion accounting models for convertible instruments. It also amends the accounting for certain contracts in an entity’s own equity that are currently accounted for as derivatives because of specific settlement provisions. In addition, ASU 2020-06 modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted EPS computation. The amendments in ASU 2020-06 are effective for smaller reporting companies as defined by the SEC for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. The Company adopted ASU 2020-06 as of January 1, 2023. The adoption did not have an impact on its condensed financial statements.

Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2023

Accounting Policies [Abstract]

Schedule of Concentration of Risk, by Risk Factor and Significant Payer

For each significant payor and customer, revenue as a percentage of total revenue and accounts receivable as a percentage of total accounts receivable are as follows:


	Revenue
	Three Months Ended March 31,
	2023		2022
Medicare	39	%	20	%
Medicare Advantage	16	%	15	%
Blue Shield	*		13	%



*						Less than 10%.


	Accounts Receivable, Net
	March 31, 2023		December 31, 2022
Medicare	45	%	21	%
Medicare Advantage	10	%	13	%

Disaggregation of Revenue

The following table includes the Company's revenues as disaggregated by payor and customer category (in thousands):


	Three Months Ended March 31,
	2023		2022
Revenue:
Commercial	$	4,215	$	6,423
Government	4,426		2,120
Client(1)	2,407		1,591
Other(2)	182		260
Total revenue	$	11,230	$	10,394

(1)Includes hospitals, other laboratories, etc.

(2)Includes patient self-pay.

Schedule of Restricted Cash and Cash Equivalents

Cash, cash equivalents and restricted cash presented in the accompanying statements of cash flows consist of the following (in thousands):


	March 31, 2023		March 31, 2022
Cash and cash equivalents	$	52,184	$	89,751
Restricted cash	200		100
	$	52,384	$	89,851

Schedule of Cash and Cash Equivalents

Cash, cash equivalents and restricted cash presented in the accompanying statements of cash flows consist of the following (in thousands):


	March 31, 2023		March 31, 2022
Cash and cash equivalents	$	52,184	$	89,751
Restricted cash	200		100
	$	52,384	$	89,851

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share

Potentially dilutive securities not included in the calculation of diluted net loss per share, because to do so would be anti-dilutive, are as follows (in common stock equivalent shares):


	March 31,
	2023	2022


Warrants to purchase common stock	409,108	409,108
Common stock options	1,019,076	2,002,039
Restricted stock units	1,494,085	878,575
Employee stock purchase plan	14,736	6,929
Total	2,937,005	3,296,651

Unaudited Condensed Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2023	Dec. 31, 2022
Preferred stock
Par value (in dollars per share)	$ 0.001	$ 0.001
Shares authorized (in shares)	10,000,000	10,000,000
Shares outstanding (in shares)	0	0
Shares issued (in shares)	0	0
Common stock
Par value (in dollars per share)	$ 0.001	$ 0.001
Shares authorized (in shares)	200,000,000	200,000,000
Shares issued (in shares)	16,827,014	16,549,984
Shares outstanding (in shares)	16,827,014	16,549,984

Fair Value Measurements

3 Months Ended

Mar. 31, 2023

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair value is defined as the exchange price that would be received for an asset or an exit price paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs.

The three-levels of the valuation hierarchy for disclosure of fair value measurements are defined as follows:

Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities;

Level 2 - Inputs other than quoted prices included within Level I that are observable, unadjusted quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and

Level 3 - Unobservable inputs that are supported by little or no market activity for the related assets or liabilities.

The categorization of a financial instrument within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The following table sets forth the Company's financial instruments that were measured at fair value on a recurring basis within the fair value hierarchy (in thousands):


	March 31, 2023
	Total		Level 1		Level 2		Level 3
Assets:
Money market funds, included in cash and cash equivalents	$	20,146	$	20,146	$	—	$	—
Certificate of deposit, included in cash and cash equivalents	30,000		30,000		—		—
Total	$	50,146	$	50,146	$	—	$	—


	December 31, 2022
	Total		Level 1		Level 2		Level 3
Assets:
Money market funds, included in cash and cash equivalents	$	29,438	$	29,438	$	—	$	—
Certificate of deposit, included in cash and cash equivalents	30,100		30,100		—		—
Total	$	59,538	$	59,538	$	—	$	—

The fair value of the Company's money market funds is based on quoted market prices.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Subsequent Events	3 Months Ended
Subsequent Events	Mar. 31, 2023
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events On April 28, 2023, the Company and Innovatus entered into the Third Loan Amendment. Pursuant to the Third Loan Amendment, the Company prepaid $10.0 million of principal (Prepayment) and amended the 2017 Term Loan by, among other things: •waiving the Prepayment Fee (as defined in the 2017 Term Loan, as amended) with respect to the Prepayment; •revising the interest rate to the sum (the Basic Rate) of (a) the greater of The Wall Street Journal prime rate (the Prime Rate) or 8.0%, plus (b) 2.0%, of which 1.5% will be payable in-kind and capitalized to the principal amount of the outstanding term loan on a monthly basis until April 1, 2026; •extending the interest-only period through March 2026 and the maturity date to December 31, 2026; •decreasing the specified levels of revenue, as measured on the last day of each quarter on a rolling twelve-month basis, that the Company must achieve to satisfy the related financial covenants (the Revenue Covenant) in the 2017 Term Loan; •removing the obligation to comply with the Revenue Covenant during any fiscal quarter if the Company maintains a minimum aggregate cash balance equal to fifty percent of the aggregate principal amount of the loan at all times during such quarter; •providing the Company with a cure period in the event it breaches certain covenants; and •revising the definition of “Permitted Indebtedness” to permit the Company to broaden the limits on the Company’s ability to incur capitalized lease obligations, finance lease obligations, purchase money indebtedness or equipment financings without Innovatus’s prior written consent.

Stockholders' Equity - Narrative (Details) - USD ($) $ in Millions		3 Months Ended
	Sep. 15, 2022	Mar. 31, 2023
Class of Stock [Line Items]
Exercise of common stock warrants (in shares)		0
Cowen Equity Distribution Agreement
Class of Stock [Line Items]
Proceeds from sale of stock	$ 50.0

Organization	3 Months Ended
Organization	Mar. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization	Organization Description of Business Exagen Inc. (the Company) is a commercial-stage diagnostics company dedicated to helping patients suffering from debilitating and chronic autoimmune diseases by enabling timely differential diagnosis and optimizing therapeutic intervention. Liquidity The Company has incurred recurring losses and negative cash flows from operating activities since inception. The Company anticipates that it will continue to incur net losses into the foreseeable future. As of March 31, 2023, the Company had cash and cash equivalents of $52.2 million and had an accumulated deficit of $263.2 million. Since inception, the Company has financed its operations primarily through a combination of equity financings, debt financing arrangements, and revenue from sales of the Company's products. Based on the Company's current business plan, management believes that its existing capital resources will be sufficient to fund the Company's obligations for at least twelve months following the issuance of these condensed financial statements. To execute its business plans, the Company may need additional funding to support its continuing operations and pursue its growth strategy. Until such time as the Company can achieve significant cash flows from operations, if ever, it expects to finance its operations through the sale of its stock, debt financings or other strategic transactions. Although the Company has been successful in raising capital in the past, there is no assurance that it will be successful in obtaining such additional financing on terms acceptable to the Company, if at all. The terms of any financing may adversely affect the holdings or the rights of the Company's stockholders. If the Company is unable to obtain funding, the Company could be forced to delay, reduce or eliminate some or all of its programs, product portfolio expansion plans or commercialization efforts, which could have a material adverse effect on the Company's business, operating results and financial condition and the Company's ability to achieve its intended business objectives.

Stock Option Plan - Restricted Stock Units (Details) - Restricted stock units - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Outstanding, December 31, 2022 (in shares)	1,036,208
Awards granted (in shares)	638,500
Awards released (in shares)	(113,720)
Awards canceled (in shares)	(66,903)
Outstanding, March 31, 2023 (in shares)	1,494,085
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Outstanding, December 31, 2022 (in dollars per share)	$ 7.28
Awards granted, Weighted-Average Grant Date Fair Value (in dollars per share)	2.30	$ 8.72
Awards released, Weighted-Average Grant Date Fair Value (in dollars per share)	11.27
Awards canceled, Weighted-Average Grant Date Fair Value (in dollars per share)	11.37
Outstanding, March 31, 2023 (in dollars per share)	$ 4.66
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Aggregate Intrinsic Value [Abstract]
Outstanding, Aggregate Intrinsic Value	$ 3,631		$ 2,487

Stock Option Plan

3 Months Ended

Mar. 31, 2023

Share-Based Payment Arrangement [Abstract]

Stock Option Plan

2019 Incentive Award Plan

In September 2019, the Company's Board of Directors adopted, and the Company's stockholders approved, the 2019 Plan. Under the 2019 Plan, which expires in September 2029, the Company may grant stock options, stock appreciation rights, restricted stock, restricted stock units and other awards to individuals who are then employees, officers, non-employee directors or consultants of the Company or its subsidiaries. The options generally expire ten years after the date of grant and are exercisable to the extent vested. Vesting is established by the Board of Directors and is generally four years from the date of grant or, for grants to new hires, date of hire. The 2019 Plan contains an "evergreen provision" that allows annual increases in the number of shares available for issuance on the first day of each calendar year through January 1, 2029 in an amount equal to the lesser of: (i) 4% of the outstanding capital stock on each December 31st, or (ii) such lesser amount determined by the Board of Directors. As of March 31, 2023, 1,851,836 shares of common stock remained available for future awards under the 2019 Plan.

2019 Employee Stock Purchase Plan

In September 2019, the Board of Directors adopted, and the Company's stockholders approved, the ESPP. The ESPP became effective on the day the ESPP was adopted by the Company's Board of Directors. The ESPP permits participants to purchase common stock through payroll deductions of up to 20% of their eligible compensation. The number of shares of common stock available for issuance under the ESPP will be annually increased on the first day of each calendar year during the term of the ESPP through January 1, 2029 in an amount equal to the lesser of (i) 1% of the outstanding capital stock on each December 31st, or (ii) such lesser amount determined by the Board of Directors. As of March 31, 2023, 508,608 shares of common stock remained available for issuance under the ESPP.

Stock Options

Stock option activity under the Company's 2019 Plan is set forth below:


	Number of Options	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in thousands)
Outstanding, December 31, 2022	1,421,235	$	12.94	7.09	$	483
Granted	—	$	—
Exercised	(93,335)	$	0.26
Forfeited	(31,019)	$	14.36
Expired	(277,805)	$	17.96
Outstanding, March 31, 2023	1,019,076	$	12.68	6.97	$	287
Vested and expected to vest, March 31, 2023	1,019,076	$	12.68	6.97	$	287
Options exercisable, March 31, 2023	804,742	$	12.80	6.64	$	287

There were no stock options granted in the three months ended March 31, 2023 and 2022.

The intrinsic value is calculated as the difference between the fair value of the Company's common stock and the exercise price of the stock options. The aggregate intrinsic value of options exercised during the three months ended March 31, 2023 was $0.2 million. There were no options exercised during the three months ended March 31, 2022. As of March 31, 2023, total unrecognized compensation cost related to option awards was $1.1 million, which is expected to be recognized over a remaining weighted-average vesting period of 0.82 years.

Restricted Stock Units

Restricted stock unit activity under the Company's 2019 Plan is set forth below:


	Number of Shares	Weighted- Average Grant Date Fair Value		Aggregate Intrinsic Value (in thousands)
Outstanding, December 31, 2022	1,036,208	$	7.28	$	2,487
Awards granted	638,500	$	2.30
Awards released	(113,720)	$	11.27
Awards canceled	(66,903)	$	11.37
Outstanding, March 31, 2023	1,494,085	$	4.66	$	3,631

As of March 31, 2023, all of the outstanding restricted stock units were unvested. The fair value of restricted stock units vested in each of the three months ended March 31, 2023 and 2022 was $0.3 million. The weighted average grant date fair value for restricted stock units granted in the three months ended March 31, 2023 and 2022 was $2.30 and $8.72, respectively. As of March 31, 2023, total unrecognized compensation cost related to restricted stock units was $6.2 million, which is expected to be recognized over a remaining weighted-average vesting period of 3.5 years.

Stock-Based Compensation Expense


	Three Months Ended March 31,
	2023		2022
Costs of revenue	$	53	$	44
Selling, general and administrative	831		1,118
Research and development	102		214
Total	$	986	$	1,376

Summary of Significant Accounting Policies - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022	Mar. 31, 2022	Dec. 31, 2021
Accounting Policies [Abstract]
Cash and cash equivalents	$ 52,184	$ 62,391	$ 89,751
Restricted cash	200	200	100
Total Cash, Cash Equivalents and Restricted Cash	$ 52,384	$ 62,591	$ 89,851	$ 99,542

Stock Option Plan - Stock Option Activity (Details) - Stock options - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Outstanding, December 31, 2022 (in shares)	1,421,235
Granted (in shares)	0	0
Exercised (in shares)	(93,335)
Forfeited (in shares)	(31,019)
Expired (in shares)	(277,805)
Outstanding, March 31, 2023 (in shares)	1,019,076		1,421,235
Vested and expected to vest, March 31, 2022 (in shares)	1,019,076
Options exercisable, March 31, 2022 (in shares)	804,742
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract]
Outstanding, December 31, 2022, Weighted Average Exercise Price (in dollars per share)	$ 12.94
Granted, Weighted Average Exercise Price (in dollars per share)	0
Exercised, Weighted Average Exercise Price (in dollars per share)	0.26
Forfeited, Weighted Average Exercise Price (in dollars per share)	14.36
Expired, Weighted Average Exercise Price (in dollars per share)	17.96
Outstanding, March 31, 2023, Weighted Average Exercise Price (in dollars per share)	12.68		$ 12.94
Vested and expected to vest, March 31, 2022 (in shares), Weighted Average Exercise Price (in dollars per share)	12.68
Options exercised, March 31, 2022 (in shares), Weighted Average Exercise Price (in dollars per share)	$ 12.80
Stock Options, Additional Disclosures [Abstract]
Outstanding, Weighted Average Remaining Contractual Term	6 years 11 months 19 days		7 years 1 month 2 days
Vested and expected to vest, Weighted Average Remaining Contractual Term	6 years 11 months 19 days
Options exercisable, Weighted Average Remaining Contractual Term	6 years 7 months 20 days
Outstanding, Aggregate Intrinsic Value	$ 287		$ 483
Vested and expected to vest, Aggregate Intrinsic Value	287
Options exercisable, Aggregate Intrinsic Value	$ 287

Unaudited Condensed Statements of Operations - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Income Statement [Abstract]
Revenue	$ 11,230	$ 10,394
Operating expenses:
Costs of revenue	5,926	5,817
Selling, general and administrative expenses	11,884	12,152
Research and development expenses	1,126	2,104
Total operating expenses	18,936	20,073
Loss from operations	(7,706)	(9,679)
Interest expense	(638)	(598)
Interest income	656	5
Net loss	$ (7,688)	$ (10,272)
Net loss per share, basic (in dollars per share)	$ (0.44)	$ (0.60)
Net loss per share, diluted (in dollars per share)	$ (0.44)	$ (0.60)
Weighted-average number of shares used to compute net loss per share, basic (in shares)	17,526,763	16,992,391
Weighted-average number of shares used to compute net loss per share, diluted (in shares)	17,526,763	16,992,391

Summary of Significant Accounting Policies - Revenue by Major Payers (Details) - Customer Concentration Risk	3 Months Ended		12 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Medicare \| Revenue
Disaggregation of Revenue [Line Items]
Percent of total revenue	39.00%	20.00%
Medicare \| Accounts Receivable
Disaggregation of Revenue [Line Items]
Percent of total revenue	45.00%		21.00%
Medicare Advantage \| Revenue
Disaggregation of Revenue [Line Items]
Percent of total revenue	16.00%	15.00%
Medicare Advantage \| Accounts Receivable
Disaggregation of Revenue [Line Items]
Percent of total revenue	10.00%		13.00%
Blue Shield \| Revenue
Disaggregation of Revenue [Line Items]
Percent of total revenue		13.00%

Commitment and Contingencies	3 Months Ended
Commitment and Contingencies	Mar. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Acquisition-related liabilities In connection with the acquisition of the medical diagnostics division of Royalty Pharma Collection Trust (Royalty Pharma) (formerly known as Cypress Bioscience, Inc.) in 2010, the Company has ongoing royalty payment obligations of 2.5% on net sales of products which incorporate certain acquired technologies. Future royalties payable under these arrangements are limited to the lesser of (i) an aggregate of $1.2 million (including an upfront payment of $0.1 million) and (ii) the total royalties earned through January 1, 2024. Licensing Agreements The Company has licensed technology for use in its diagnostic tests. In addition to the milestone payments required by these agreements, individual license agreements generally provide for ongoing royalty payments ranging from 1.5% to 7.0% on net sales of products which incorporate licensed technology, as defined in such agreements. Royalties are accrued when earned and recorded in costs of revenue in the accompanying condensed statements of operations. Collaboration Obligations In May 2021, the Company entered into a master research collaboration agreement with Allegheny Health Network Research Institute (AHN), pursuant to which the Company is required to pay AHN a collaboration fee of $0.4 million for each year during the initial term of the agreement. Collaboration expenses under the master research collaboration agreement were $0.1 million for each of the three months ended March 31, 2023 and 2022. Collaboration expenses under the AHN collaboration are included in research and development expenses. Supply Agreement In December 2021, the Company entered into an amended supply agreement with one supplier for reagents which includes minimum annual purchase commitments of $6.9 million and $8.0 million for the years ending December 31, 2023 and 2024, respectively, with a 15% annual increase thereafter for unconditional minimum purchase commitments through the year ending December 31, 2025. Contingencies In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties and provide for general indemnifications; including for subpoenas and other civil investigative demands, from governmental agencies, Medicare or Medicaid and managed care organizations reviewing billing practices or requesting comment on allegations of billing irregularities that are brought to their attention through billing audits or third parties. The Company's exposure under these agreements is unknown because it involves claims that may be made against the Company in the future, but have not yet been made or that the Company believes to be immaterial. The Company accrues a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. Litigation From time to time, the Company may be subject to various legal proceedings that arise in the ordinary course of business activities. The Company does not believe the outcome of any such matters will have a material effect on its financial position or results of operations.

Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2023

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Financial Instrument Measured on a Recurring Basis

The following table sets forth the Company's financial instruments that were measured at fair value on a recurring basis within the fair value hierarchy (in thousands):


	March 31, 2023
	Total		Level 1		Level 2		Level 3
Assets:
Money market funds, included in cash and cash equivalents	$	20,146	$	20,146	$	—	$	—
Certificate of deposit, included in cash and cash equivalents	30,000		30,000		—		—
Total	$	50,146	$	50,146	$	—	$	—


	December 31, 2022
	Total		Level 1		Level 2		Level 3
Assets:
Money market funds, included in cash and cash equivalents	$	29,438	$	29,438	$	—	$	—
Certificate of deposit, included in cash and cash equivalents	30,100		30,100		—		—
Total	$	59,538	$	59,538	$	—	$	—

Stockholders' Equity

3 Months Ended

Mar. 31, 2023

Equity [Abstract]

Stockholders' Equity

Common Stock

At The Market Sales Agreement

On September 15, 2022, the Company entered into a sales agreement (the Sales Agreement) with Cowen and Company, LLC (the Sales Agent), pursuant to which the Company may offer and sell, from time to time, shares of Company common stock having an aggregate offering price of up to $50.0 million. The Company is not obligated to

sell any shares of Company common stock in the offering. As of March 31, 2023, the Company has not sold any shares of its common stock pursuant to the Sales Agreement.

Outstanding Warrants

The following equity classified warrants to purchase common stock were outstanding as of March 31, 2023:


	Shares	Exercise Price		Issuance date	Expiration date
Common stock warrants	237,169	$	1.84	January 19, 2016	January 19, 2026
Common stock warrants	67,086	$	1.84	March 31, 2016	March 31, 2026
Common stock warrants	131	$	1.84	April 1, 2016	April 1, 2026
Common stock warrants	83,778	$	14.32	September 7, 2017	September 7, 2024
Common stock warrants	20,944	$	14.32	December 7, 2018	December 7, 2025
Common stock warrants	804,951	$	0.001	June 22, 2021	None
	1,214,059

During the three months ended March 31, 2023, no warrants to purchase common stock were exercised.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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-Name Accounting Standards Codification
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-Section 50
-Paragraph 13
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496158-112644

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-Topic 505
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-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496171-112644

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Paragraph 14
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-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496171-112644

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-URI https://asc.fasb.org/extlink&oid=120397183&loc=d3e187085-122770

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-Subparagraph (d)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496189-112644

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496158-112644

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496189-112644

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (h)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496158-112644

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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Reference 15: http://www.xbrl.org/2003/role/disclosureRef
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Reference 16: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Borrowings - Narrative (Details)	1 Months Ended		3 Months Ended
Borrowings - Narrative (Details)	Nov. 30, 2021 USD ($) installment	Sep. 30, 2017 USD ($)	Mar. 31, 2023 USD ($)	Mar. 31, 2022 USD ($)	May 31, 2022 USD ($)
2017 Term loan \| Loan payable \| Innovatus Life Sciences Lending Fund
Debt Instrument [Line Items]
Term loan borrowings		$ 25,000,000
Remaining borrowing capacity			$ 0
Term loan, interest rate	8.00%
Term loan, paid in-kind, interest rate	2.00%
Term loan, effective interest rate	8.50%
Number of monthly installments \| installment	24
Term loan, fee incurred upon payment of final installment			$ 1,000,000
Term loan, prepayment premium percentage	2.00%
Term loan, annual reduction in prepayment penalty percentage	1.00%
Term loan, covenant, revenue performance period			12 months
Term loan, covenant, number of days to cure covenant if performance measure is not met			60 days
Term loan covenant, minimum unrestricted cash balance	$ 2,000,000.0
Term loan covenant, increase to interest rate			4.00%
2017 Term loan \| Paid in-kind note \| Innovatus Life Sciences Lending Fund
Debt Instrument [Line Items]
Term loan, paid in-kind loans issued			$ 100,000	$ 100,000
Equipment Notes Payable
Debt Instrument [Line Items]
Term loan, effective interest rate					5.28%
Notes payable					$ 1,000,000
Notes payable, current					300,000
Notes payable, noncurrent					$ 700,000

Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2023

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Basis of Presentation and Use of Estimates

The accompanying interim condensed balance sheet as of March 31, 2023, condensed statements of operations, stockholders' equity and cash flows for the three months ended March 31, 2023 and the related footnote disclosures are unaudited and have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (SEC), and with accounting principles generally accepted in the United States (GAAP) applicable to interim financial statements. These unaudited condensed financial statements and related footnote disclosures should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2022, included in its Annual Report on Form 10-K filed with the SEC on March 20, 2023. In management's opinion, the unaudited interim condensed financial statements have been prepared on the same basis as the audited financial statements and include all normal adjustments, necessary for the fair presentation of the Company's financial position as of March 31, 2023 and its results of operations for the periods presented. The results for the three months ended March 31, 2023 are not necessarily indicative of the results expected for the full fiscal year or any other interim period. The year-end condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP.

The preparation of the accompanying condensed financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the condensed financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could materially differ from those estimates.

Significant estimates and assumptions made in the accompanying condensed financial statements include, but are not limited to revenue recognition, the recoverability of its long-lived assets and net deferred tax assets (and related valuation allowance). The Company evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Actual results could materially differ from those estimates.

Concentration of Credit Risk and Other Risk and Uncertainties

Financial instruments that potentially subject the Company to credit risk consist principally of cash, cash equivalents and accounts receivable. Substantially all the Company's cash and cash equivalents are held at one financial institution that management believes is of high credit quality. Such deposits may, at times, exceed federally insured limits. The Company has not experienced any losses on its cash or cash equivalents.

Significant payors and customers are those which represent more than 10% of the Company's total revenue or accounts receivable balance at each respective balance sheet date. For each significant payor and customer, revenue as a percentage of total revenue and accounts receivable as a percentage of total accounts receivable are as follows:


	Revenue
	Three Months Ended March 31,
	2023		2022
Medicare	39	%	20	%
Medicare Advantage	16	%	15	%
Blue Shield	*		13	%



*						Less than 10%.


	Accounts Receivable, Net
	March 31, 2023		December 31, 2022
Medicare	45	%	21	%
Medicare Advantage	10	%	13	%

For the three months ended March 31, 2023 and 2022, approximately 87% and 84%, respectively, of the Company's revenue was related to the AVISE® CTD test.

The Company is dependent on key suppliers for certain laboratory materials. For the three months ended March 31, 2023 and 2022, approximately 97% and 95%, respectively, of the Company's diagnostic testing supplies were purchased from two suppliers. An interruption in the supply of these materials would impact the Company's ability to perform testing services.

Disaggregation of Revenue

The following table includes the Company's revenues as disaggregated by payor and customer category (in thousands):


	Three Months Ended March 31,
	2023		2022
Revenue:
Commercial	$	4,215	$	6,423
Government	4,426		2,120
Client(1)	2,407		1,591
Other(2)	182		260
Total revenue	$	11,230	$	10,394

(1)Includes hospitals, other laboratories, etc.

(2)Includes patient self-pay.

Fair Value Measurements

The carrying value of the Company's cash, cash equivalents and restricted cash, accounts receivable, prepaid expenses and other current assets, accounts payable and accrued and other current liabilities approximate their fair values due to their short-term nature, which are determined to be a Level 1 measurement (see Note 6). The estimated fair value of the Company's long-term borrowings is determined by Level 2 inputs and based primarily on quoted market prices for the same or similar issues. As of March 31, 2023, the 2017 Term Loan (as defined below) had a carrying value of $28.4 million and a fair value of $27.1 million. As of December 31, 2022, the 2017 Term Loan had a carrying value of $28.3 million and a fair value of $26.9 million The estimated fair value of the 2017 Term Loan, was determined based on a discounted cash flow approach using available market information on discount and borrowing rates with similar terms, maturities, and credit ratings. The recorded value of the Company's other long-term borrowing was $0.7 million and approximated its fair value as of March 31, 2023.

Cash, Cash Equivalents and Restricted Cash

The Company considers all highly-liquid investments purchased with a remaining maturity date of three months or less upon acquisition to be cash equivalents. These investments are stated at cost, which approximates fair value.

The Company has an arrangement with a financial institution with which it has an existing banking relationship, whereby in exchange for the issuance of corporate credit cards, the Company agreed to obtain a certificate of deposit with this financial institution as collateral for the balances borrowed on these cards ($0.2 million at March 31, 2023 and December 31, 2022). The Company has classified the value of this certificate of deposit (including all interest earned thereon) within other assets in the accompanying balance sheets. The Company has the right to terminate the credit card program at any time. Upon termination of the credit card program and repayment of all outstanding balances owed, the Company may redeem the certificate of deposit (and all interest earned thereon).

Cash, cash equivalents and restricted cash presented in the accompanying statements of cash flows consist of the following (in thousands):


	March 31, 2023		March 31, 2022
Cash and cash equivalents	$	52,184	$	89,751
Restricted cash	200		100
	$	52,384	$	89,851

Long-lived Assets

The Company’s long-lived assets are comprised principally of its property and equipment and operating lease assets. The Company amortizes all finite lived intangible assets over their respective estimated useful lives. Operating lease assets are amortized over the term of the leases. In considering whether long-lived assets are impaired, we combine our intangible assets and other long-lived assets, into groupings, a determination which we principally make on the basis of whether the assets are specific to a particular test we offer or technology we are developing. If the Company identifies a change in the circumstances related to its long-lived assets that indicates the carrying value of any such asset may not be recoverable, the Company will perform an impairment analysis. A

long-lived asset is deemed to be impaired when the undiscounted cash flows expected to be generated by the asset (or asset group) are less than the asset’s carrying amount. Management’s estimates of future cash flows are impacted by projected test volume and levels of reimbursement, as well as expectations related to the future cost structure of the entity. Any required impairment loss would be measured as the amount by which the asset’s carrying value exceeds its fair value, and would be recorded as a reduction in the carrying value of the related asset and a charge to operating expense.

Revenue Recognition

Substantially all of the Company's revenue has been derived from sales of its testing products and is primarily comprised of a high volume of relatively low-dollar transactions. The Company primarily markets its testing products to rheumatologists and their physician assistants in the United States. The healthcare professionals who order the Company's testing products and to whom test results are reported are generally not responsible for payment for these products. The parties that pay for these services (each, a payor) consist of commercial payors (healthcare insurers), government payors (primarily Medicare and Medicaid), client payors (i.e., hospitals, other laboratories, etc.) and patient self-pay. The Company's service is a single performance obligation that is completed upon the delivery of test results to the prescribing physician which triggers revenue recognition.

Payors are billed at the Company's list price. Net revenues recognized consist of amounts billed net of allowances for differences between amounts billed and the estimated consideration the Company expects to receive from such payors. The process for estimating revenues and the ultimate collection of accounts receivable involves significant judgment and estimation. The Company follows a standard process, which considers historical denial and collection experience, insurance reimbursement policies and other factors, to estimate allowances and implicit price concessions. Adjustments are recorded in the current period as changes in estimates occur. Further adjustments to the allowances, based on actual receipts, are recorded upon settlement. Included in revenues for the three months ended March 31, 2023 and 2022 was a $0.3 million net revenue increase and a $0.2 million net revenue decrease, respectively, associated with changes in estimated variable consideration related to performance obligations satisfied in previous periods. The transaction price is estimated using an expected value method on a portfolio basis.

Variable consideration is included in the transaction price only to the extent it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainties with respect to the amount are resolved. The Company's portfolios are grouped per payor (i.e. each individual commercial payor, Medicare, Medicaid, client payors, patient self-pay, etc.) and per test. Consideration may be constrained and excluded from the transaction price in situations where there is no contractually agreed upon reimbursement coverage or in absence of a predictable pattern and history of collectability with a payor. Accordingly, in such situations revenues are recognized on the basis of actual cash collections. Additionally, from time to time, the Company may issue refunds to payors for overpayments or amounts billed in error. Any refunds are accounted for as reductions in revenues in the statement of operations as an element of variable consideration. The estimated expected refunds are accrued as a liability on the Company’s balance sheet.

Collection of the Company's net revenues from payors is normally a function of providing complete and correct billing information to the healthcare insurers and generally occurs within 30 to 90 days of billing. Contracts do not contain significant financing components based on the typical period of time between performance of services and collection of consideration.

Accounts Receivable and Allowance for Credit Losses

We accrue an allowance for credit losses against our accounts receivable based on management’s current estimate of amounts that will not be collected. Management’s estimates are typically based on historical loss information adjusted for current conditions. We generally do not perform evaluations of the financial condition of our customers and generally do not require collateral. The allowance for credit losses was zero as of March 31, 2023. Adjustments for implicit price concessions attributable to variable consideration, as discussed above, are incorporated into the measurement of the accounts receivable balances and are not part of the allowance for credit losses.

Research and Development

Costs associated with research and development activities are expensed as incurred and include, but are not limited to, personnel-related expenses, including stock-based compensation expense, materials, laboratory

supplies, consulting costs, costs associated with setting up and conducting clinical studies and allocated overhead including rent and utilities.

Advertising and Marketing Costs

Costs associated with advertising and marketing activities are expensed as incurred. Total advertising and marketing costs were approximately $0.3 million for the three months ended March 31, 2023 and 2022, and are included in selling, general and administrative expenses in the accompanying condensed statements of operations.

Shipping and Handling Costs

Costs incurred for shipping and handling are included in costs of revenue in the accompanying condensed statements of operations and totaled approximately $0.7 million and $0.6 million for the three months ended March 31, 2023 and 2022, respectively.

Stock-Based Compensation

The Company recognizes compensation expense for all stock-based awards to employees and directors based on the grant-date estimated fair values over the requisite service period of the awards (usually the vesting period) on a straight-line basis. The fair value of stock options and purchases under the Company's 2019 Employee Stock Purchase Plan (ESPP) rights is determined using the Black-Scholes-Merton (BSM) option pricing model, which requires management to make certain assumptions regarding a number of complex and subjective variables. Equity award forfeitures are recorded as they occur.

The BSM option pricing model incorporates various inputs, including the fair value of the Company's common stock, expected volatility, expected term and risk-free interest rates. Volatility is based on the Company's historical calculated volatility since being publicly traded. The weighted-average expected term of options was calculated using the simplified method. The risk-free interest rate for periods within the contractual term of the option is based on the U.S. Treasury yield in effect at the time of grant. The dividend yield is zero, as the Company has never declared or paid dividends and has no plans to do so in the foreseeable future.

The fair value of each restricted stock unit is determined on the grant date using the closing price of the Company's common stock on that date. The Company's restricted stock units generally vest in equal annual installments over four years from the date of grant or, for grants to new hires, date of hire. Vesting of restricted stock units is subject to the holder's continued service with the Company. The Company issues new shares to satisfy restricted stock units upon vesting.

Comprehensive Loss

Comprehensive loss is defined as a change in equity of a business enterprise during a period, resulting from transactions from nonowner sources. There have been no items qualifying as other comprehensive loss and, therefore, for all periods presented, the Company's comprehensive loss was the same as its reported net loss.

Net Loss Per Share

Basic net loss per share attributable to common stockholders is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common stock equivalents outstanding for the period determined using the treasury-stock and if-converted methods. The weighted-average number of shares used to compute basic and diluted shares includes shares issuable upon the exercise of pre-funded warrants at a nominal price. Potentially dilutive common stock equivalents are comprised of warrants for the purchase of common stock, stock options, restricted stock units outstanding under the Company's 2019 Incentive Award Plan (the 2019 Plan) and shares of the Company's common stock pursuant to the ESPP. For the three months ended March 31, 2023 and 2022, there is no difference in the number of shares used to calculate basic and diluted shares outstanding, as the inclusion of the potentially dilutive securities would be antidilutive.

Potentially dilutive securities not included in the calculation of diluted net loss per share, because to do so would be anti-dilutive, are as follows (in common stock equivalent shares):


	March 31,
	2023	2022


Warrants to purchase common stock	409,108	409,108
Common stock options	1,019,076	2,002,039
Restricted stock units	1,494,085	878,575
Employee stock purchase plan	14,736	6,929
Total	2,937,005	3,296,651

Segment Reporting

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. The Company views its operations as, and manages its business in, one operating segment.

Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (FASB), or other standard setting bodies and adopted by the Company as of the specified effective date. Under the Jumpstart Our Business Startups Act of 2012 (JOBS Act), the Company meets the definition of an emerging growth company. The Company has elected to use the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act. Unless otherwise discussed, the impact of recently issued standards that are not yet effective will not have a material impact on the Company's financial position or results of operations upon adoption.

Recently Adopted Accounting Standards

In June 2016, the FASB issued Accounting Standards Update (ASU) 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which requires the measurement of expected credit losses (based on historical experience, current conditions and reasonable forecasts) for financial instruments (such as accounts receivable) held at the reporting date which are carried at amortized cost. The main objective of this ASU is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. In November 2018, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financing Instruments-Credit Losses, which included an amendment of the effective date for nonpublic entities. For emerging growth companies, ASU 2016-13 is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company adopted this pronouncement on January 1, 2023. The adoption did not have an impact on its condensed financial statements.

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40). ASU 2020-06 eliminates the beneficial conversion and cash conversion accounting models for convertible instruments. It also amends the accounting for certain contracts in an entity’s own equity that are currently accounted for as derivatives because of specific settlement provisions. In addition, ASU 2020-06 modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted EPS computation. The amendments in ASU 2020-06 are effective for smaller reporting companies as defined by the SEC for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. The Company adopted ASU 2020-06 as of January 1, 2023. The adoption did not have an impact on its condensed financial statements.

Other Financial Information - Accrued and Other Current Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Other Financial Information [Abstract]
Accrued payroll and related expenses	$ 3,662	$ 2,355
Accrued interest	142	142
Accrued purchases of goods and services	665	803
Accrued royalties	114	514
Accrued clinical study activity	160	162
Finance lease obligations, current portion	650	700
Refund liability	445	445
Other accrued liabilities	226	226
Accrued and other current liabilities	$ 6,064	$ 5,347

Stockholders' Equity (Tables)

3 Months Ended

Mar. 31, 2023

Equity [Abstract]

Schedule of Outstanding Warrants

The following equity classified warrants to purchase common stock were outstanding as of March 31, 2023:


	Shares	Exercise Price		Issuance date	Expiration date
Common stock warrants	237,169	$	1.84	January 19, 2016	January 19, 2026
Common stock warrants	67,086	$	1.84	March 31, 2016	March 31, 2026
Common stock warrants	131	$	1.84	April 1, 2016	April 1, 2026
Common stock warrants	83,778	$	14.32	September 7, 2017	September 7, 2024
Common stock warrants	20,944	$	14.32	December 7, 2018	December 7, 2025
Common stock warrants	804,951	$	0.001	June 22, 2021	None
	1,214,059

Other Financial Information

3 Months Ended

Mar. 31, 2023

Other Financial Information [Abstract]

Other Financial Information

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following (in thousands):


	March 31, 2023		December 31, 2022
Diagnostic testing supplies	$	1,736	$	1,795
Prepaid product royalties	39		40
Prepaid maintenance and insurance contracts	2,210		2,072
Other prepaid expenses and other current assets	244		236
Prepaid expenses and other current assets	$	4,229	$	4,143

Property and Equipment

Property and equipment consist of the following (in thousands):


	March 31, 2023		December 31, 2022
Furniture and fixtures	$	98	$	98
Laboratory equipment	5,209		5,136
Computer equipment and software	1,548		1,482
Leasehold improvements	5,223		5,223
Construction in progress	1,856		1,382
Total property and equipment	13,934		13,321
Less: accumulated depreciation and amortization	(5,670)		(5,124)
Property and equipment, net	$	8,264	$	8,197

Depreciation and amortization expense for the three months ended March 31, 2023 and 2022 was approximately $0.6 million and $0.3 million, respectively.

Accrued and Other Current Liabilities

Accrued and other current liabilities consist of the following (in thousands):


	March 31, 2023		December 31, 2022
Accrued payroll and related expenses	$	3,662	$	2,355
Accrued interest	142		142
Accrued purchases of goods and services	665		803
Accrued royalties	114		514
Accrued clinical study activity	160		162
Finance lease obligations, current portion	650		700
Refund liability	445		445
Other accrued liabilities	226		226
Accrued and other current liabilities	$	6,064	$	5,347

Other Financial Information (Tables)

3 Months Ended

Mar. 31, 2023

Other Financial Information [Abstract]

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following (in thousands):


	March 31, 2023		December 31, 2022
Diagnostic testing supplies	$	1,736	$	1,795
Prepaid product royalties	39		40
Prepaid maintenance and insurance contracts	2,210		2,072
Other prepaid expenses and other current assets	244		236
Prepaid expenses and other current assets	$	4,229	$	4,143

Property and Equipment

Property and equipment consist of the following (in thousands):


	March 31, 2023		December 31, 2022
Furniture and fixtures	$	98	$	98
Laboratory equipment	5,209		5,136
Computer equipment and software	1,548		1,482
Leasehold improvements	5,223		5,223
Construction in progress	1,856		1,382
Total property and equipment	13,934		13,321
Less: accumulated depreciation and amortization	(5,670)		(5,124)
Property and equipment, net	$	8,264	$	8,197

Accrued and Other Current Liabilities

Accrued and other current liabilities consist of the following (in thousands):


	March 31, 2023		December 31, 2022
Accrued payroll and related expenses	$	3,662	$	2,355
Accrued interest	142		142
Accrued purchases of goods and services	665		803
Accrued royalties	114		514
Accrued clinical study activity	160		162
Finance lease obligations, current portion	650		700
Refund liability	445		445
Other accrued liabilities	226		226
Accrued and other current liabilities	$	6,064	$	5,347

Fair Value Measurements (Details) - Recurring - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Assets:
Total	$ 50,146	$ 59,538
Money market funds, included in cash and cash equivalents
Assets:
Money market funds, included in cash and cash equivalents	20,146	29,438
Certificate of deposit, included in cash and cash equivalents
Assets:
Money market funds, included in cash and cash equivalents	30,000	30,100
Level 1
Assets:
Total	50,146	59,538
Level 1 \| Money market funds, included in cash and cash equivalents
Assets:
Money market funds, included in cash and cash equivalents	20,146	29,438
Level 1 \| Certificate of deposit, included in cash and cash equivalents
Assets:
Money market funds, included in cash and cash equivalents	30,000	30,100
Level 2
Assets:
Total	0	0
Level 2 \| Money market funds, included in cash and cash equivalents
Assets:
Money market funds, included in cash and cash equivalents	0	0
Level 2 \| Certificate of deposit, included in cash and cash equivalents
Assets:
Money market funds, included in cash and cash equivalents	0	0
Level 3
Assets:
Total	0	0
Level 3 \| Money market funds, included in cash and cash equivalents
Assets:
Money market funds, included in cash and cash equivalents	0	0
Level 3 \| Certificate of deposit, included in cash and cash equivalents
Assets:
Money market funds, included in cash and cash equivalents	$ 0	$ 0

Summary of Significant Accounting Policies - Narrative (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2023 USD ($) segment	Mar. 31, 2022 USD ($)	Dec. 31, 2022 USD ($)
New Accounting Pronouncement, Early Adoption [Line Items]
Long-term debt	$ 29,346
Restricted cash	200	$ 100	$ 200
Revenue recognized in previous periods	300	200
Advertising expense	$ 300	300
Number of operating segments \| segment	1
Other Long Term Debt
New Accounting Pronouncement, Early Adoption [Line Items]
Debt instrument	$ 700
Restricted stock units
New Accounting Pronouncement, Early Adoption [Line Items]
Stock options, vesting period	4 years
2017 Term loan \| Level 2 \| Recurring
New Accounting Pronouncement, Early Adoption [Line Items]
Long-term debt	$ 28,400		28,300
Debt instrument	27,100		$ 26,900
Shipping and Handling
New Accounting Pronouncement, Early Adoption [Line Items]
Cost of revenue	$ 700	$ 600
Revenue \| Product Concentration Risk \| AVISE CTD Test
New Accounting Pronouncement, Early Adoption [Line Items]
Percent of total revenue	87.00%	84.00%
Revenue \| Supplier Concentration Risk \| Two Major Suppliers
New Accounting Pronouncement, Early Adoption [Line Items]
Percent of total revenue	97.00%	95.00%

Subsequent Events (Details) - 2017 Term loan - Innovatus Life Sciences Lending Fund - Loan payable - USD ($) $ in Millions		1 Months Ended
	Apr. 28, 2023	Sep. 30, 2017	Nov. 30, 2021
Subsequent Event [Line Items]
Term loan borrowings		$ 25.0
Term loan, interest rate			8.00%
Term loan, paid in-kind, interest rate			2.00%
Subsequent Event
Subsequent Event [Line Items]
Term loan, interest rate	2.00%
Term loan, paid in-kind, interest rate	1.50%
Payment for Debt Extinguishment or Debt Prepayment Cost	$ 10.0
Subsequent Event \| Prime Rate
Subsequent Event [Line Items]
Variable rate	8.00%