0001274737-24-000022 | 10-K | XBRL Viewer

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401(k) Plan	12 Months Ended
401(k) Plan	Dec. 31, 2023
Retirement Benefits [Abstract]
401(k) Plan	401(k) Plan The Company sponsors an employee savings plan that qualifies as a deferred salary arrangement under Section 401(k) of the Code. Participating employees may defer up to the Internal Revenue Service annual contribution limit. Additionally, the Company may elect to make contributions into the savings plan at its sole discretion. For each of the years ended December 31, 2023 and 2022, the Company made contributions to the 401(k) Plan at 4% of qualified employee compensation. For the years ended December 31, 2023 and 2022, these contributions totaled approximately $0.8 million and $0.9 million, respectively.

- Definition

The entire disclosure for retirement benefits.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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-SubTopic 70
-Name Accounting Standards Codification
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+ Details

Summary of Significant Accounting Policies - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Accounting Policies [Abstract]
Cash and cash equivalents	$ 36,493	$ 62,391
Restricted cash	200	200
Total cash, cash equivalents and restricted cash	$ 36,693	$ 62,591	$ 99,542

Audit Information	12 Months Ended
Audit Information	Dec. 31, 2023
Audit Information [Abstract]
Auditor Name	BDO USA, P.C.
Auditor Location	San Diego, California
Auditor Firm ID	243

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)		64,064
Issuance of stock from vested restricted stock units and payment of employees' taxes	(239)		(239)
Exercise of stock options (in shares)		245,186
Exercise of stock options	61	$ 1	60
Issuance of stock under Employee Stock Purchase Plan (in shares)		75,740
Issuance of stock under Employee Stock Purchase Plan	385		385
Stock-based compensation	4,704		4,704
Net loss	$ (47,387)			(47,387)
Ending balance (in shares) at Dec. 31, 2022	16,549,984	16,549,984
Ending 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 (in shares)		273,042
Exercise of stock options (in shares)	93,335	93,335
Exercise of stock options	$ 27		27
Issuance of stock under Employee Stock Purchase Plan (in shares)		129,593
Issuance of stock under Employee Stock Purchase Plan	279		279
Stock-based compensation	3,617		3,617
Net loss	$ (23,689)			(23,689)
Ending balance (in shares) at Dec. 31, 2023	17,045,954	17,045,954
Ending balance at Dec. 31, 2023	$ 22,694	$ 17	$ 301,893	$ (279,216)

Stockholders' Equity - Narrative (Details) - USD ($) $ in Thousands		12 Months Ended
	Sep. 15, 2022	Dec. 31, 2023	Dec. 31, 2022
Subsidiary, Sale of Stock [Line Items]
Exercise of common stock warrants (in shares)		0	0
Shelf Registration Statement
Subsidiary, Sale of Stock [Line Items]
Common stock offering, authorized amount		$ 150,000
Common stock offering, remaining authorized amount		$ 150,000
Cowen Equity Distribution Agreement
Subsidiary, Sale of Stock [Line Items]
Consideration received on transaction	$ 50,000

Summary of Significant Accounting Policies (Policies)	12 Months Ended
Summary of Significant Accounting Policies (Policies)	Dec. 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.
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.
Property and Equipment	Property and Equipment Property and equipment are stated at cost, net of depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, generally between three and five years. Leasehold improvements are amortized on a straight-line basis over the lesser of the estimated useful life or the remaining term of the related lease. Maintenance and repairs are charged to expense as incurred, and improvements and betterments are capitalized. When assets are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the balance sheet and any resulting gain or loss is reflected in operating expenses in the statements of operations in the period realized.
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, the Company combines its intangible assets and other long-lived assets into groupings, a determination which is made principally on the basis of whether the assets are specific to a particular test offered or technology being developed. 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.
Goodwill	Goodwill The Company operates in a single operating segment and reporting unit for the measurement of goodwill. Goodwill was reviewed for impairment annually (during the fourth quarter) or more frequently if indicators of impairment existed. The Company would first assess qualitative factors to determine whether it was more likely than not that the fair value of the reporting unit was less than its carrying amount as a basis for determining whether it was necessary to perform a quantitative assessment. If, after assessing qualitative factors, the Company determined it was not more likely than not that the fair value of a reporting unit was less than its carrying amount, then performing a quantitative assessment was unnecessary. If deemed necessary, a quantitative assessment compared the fair value of the reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit exceeded its carrying amount, goodwill was not considered impaired; otherwise, an impairment loss was recorded.
Leases	Leases The Company categorizes leases at their commencement as either operating or finance leases. The Company recognizes operating lease ROU assets and operating lease liabilities for each lease arrangement identified. Lease liabilities are recorded at the present value of future lease payments discounted using the Company's incremental borrowing rate for the lease established at the commencement date. The incremental borrowing rate is the rate of interest the Company would have to pay to borrow, on a collateralized basis over a similar term and in a similar economic environment, an amount equal to the total lease payments. The Company primarily considers industry data, its credit rating and the lease term to determine its incremental borrowing rate. ROU assets are measured at the amount of the lease liability plus any initial direct costs, less any lease incentives received before commencement. Lease expense is recognized as a single lease cost over the lease term on a straight-line basis. The Company has elected not to apply the recognition requirements to short-term leases and not to separate non-lease components from lease components for its leases.
Clinical Studies	Clinical Studies From time to time, the Company engages in efforts to scientifically measure and document the application and efficacy of its various testing products. These arrangements typically require the Company to pay a fee to a third-party scientific investigator (usually a physician or research institution) for each subject enrolled in a clinical study, and the Company accrues expenses based on estimated progress of services performed, including actual level of subjects enrolled and progress of the clinical studies. Payments made prior to the completion of clinical study services are capitalized as a prepaid expense. The prepaid amounts are expensed as the related goods are delivered or the services are performed, or when it is no longer expected that the goods will be delivered or the services rendered. Expenses associated with clinical study activities are recorded in research and development expenses in the accompanying statement of operations.
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 recognizes revenue in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (ASC 606) and follows a five-step process to determine the amount and timing of revenue recognized: (1) identify the contract with the customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to performance obligations in the contract, and (5) recognize revenue when (or as) the performance obligation is satisfied. 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 generally billed at the Company's list price, unless a separate pricing contract is in place. 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 years ended December 31, 2023 and 2022 was a net revenue increase of $3.4 million and a net revenue decrease of $2.4 million, 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, along with any requested medical or other claims-related information to the healthcare insurers. This generally occurs within 30 to 90 days of billing, however, the amount and timing of any reimbursements or collections for our billed tests may vary by payor and other circumstances. 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	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 December 31, 2023. There was no allowance for credit losses recognized as of December 31, 2022. 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	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; depreciation; amortization 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 $1.5 million and $3.0 million for the years ended December 31, 2023 and 2022, respectively, and are included in selling, general and administrative expenses in the accompanying 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 statements of operations and were approximately $2.5 million and $2.7 million for the years ended December 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, as we have concluded that our stock option exercise history does not provide a reasonable basis upon which to estimate the expected term. 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 (RSU) is determined on the grant date using the closing price of the Company's common stock on that date. The Company's RSUs 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 RSUs is subject to the holder's continued service with the Company. The Company issues new shares to satisfy RSUs 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.
Income Taxes	Income Taxes The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized as an expense in the period that includes the enactment date. The Company recognizes net deferred tax assets to the extent that the Company believes these assets are more likely than not to be realized. In making such a determination, management considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If management determines that the Company would be able to realize its deferred tax assets in the future in excess of their net recorded amount, management would adjust the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Company records uncertain tax positions on the basis of a two-step process whereby (i) management determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (ii) for those tax positions that meet the more-likely-than-not recognition threshold, management recognizes the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits within income tax expense. Any accrued interest and penalties are included within the related tax liability.
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, RSUs 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 each of the years ended December 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, Accounting Standards Updates (ASU) not included in the Company’s disclosures were assessed and determined to be either not applicable or are not expected to have a material impact on the Company’s financial statements or disclosures. In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (ASU 2023-07), which requires public entities to disclose significant segment expenses that are regularly provided to the Chief Operating Decision Maker (CODM) and details of how the CODM uses financial reporting to assess the performance of a segment. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. This ASU will likely result in additional required disclosure when adopted. The Company is currently evaluating the provisions of this ASU and the impact on its financial statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which requires additional income tax disclosures in the rate reconciliation table for federal, state and foreign income taxes, in addition to more details about the reconciling items in some categories when items meet a certain quantitative threshold. ASU 2023-09 is effective for annual periods beginning after December 15, 2024 with early adoption permitted. The Company is currently evaluating the impact of this standard, but does not expect that it will have a material impact on its financial statements. Recently Adopted Accounting Standards In June 2016, the FASB issued 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. The Company adopted this pronouncement on January 1, 2023. The adoption did not have material impact on its 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 early adopted ASU 2020-06 as of January 1, 2023. The adoption did not have an impact on its financial statements.
Fair Value Measurements	The carrying values 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 and are considered to be Level 1 measurements. 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 December 31, 2023, the Amended Loan Agreement had a carrying value of $18.7 million and a fair value of $19.7 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 Amended Loan Agreement 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 carrying value of the Company's other long-term borrowing as of December 31, 2023 was $0.8 million, which approximated its fair value. 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.

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2023

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Basis of Presentation and Use of Estimates

The Company's financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). The preparation of the accompanying 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 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 financial statements include, but are not limited to revenue recognition, the estimated incremental borrowing rate for the determination of the Company's operating lease right-of-use (ROU) assets and 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
	Year Ended December 31,
	2023		2022
Medicare	34	%	39	%
Medicare Advantage	17	%	15	%


	Accounts Receivable
	December 31,
	2023		2022
Medicare	42	%	21	%
Medicare Advantage	16	%	13	%

For the years ended December 31, 2023 and 2022, approximately 88% 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 each of the years ended December 31, 2023 and 2022, approximately 96% 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):


	Year Ended December 31,
	2023		2022
Revenue:
Commercial	$	23,985	$	18,975
Government	18,002		17,687
Client(1)	9,949		7,928
Other(2)	612		973
Total revenue	$	52,548	$	45,563

(1)Includes hospitals, other laboratories, etc.

(2)Includes patient self-pay.

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 in the amount of $0.2 million as collateral for the balances borrowed on these cards. 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):


	December 31,
	2023		2022
Cash and cash equivalents	$	36,493	$	62,391
Restricted cash	200		200
	$	36,693	$	62,591

Property and Equipment

Property and equipment are stated at cost, net of depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, generally between three and five years. Leasehold improvements are amortized on a straight-line basis over the lesser of the estimated useful life or the remaining term of the related lease. Maintenance and repairs are charged to expense as incurred, and improvements and betterments are capitalized. When assets are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the balance sheet and any resulting gain or loss is reflected in operating expenses in the statements of operations in the period realized.

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, the Company combines its intangible assets and other long-lived assets into groupings, a determination which is made principally on the basis of whether the assets are specific to a particular test offered or technology being developed. 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.

Goodwill

The Company operates in a single operating segment and reporting unit for the measurement of goodwill. Goodwill was reviewed for impairment annually (during the fourth quarter) or more frequently if indicators of impairment existed. The Company would first assess qualitative factors to determine whether it was more likely than not that the fair value of the reporting unit was less than its carrying amount as a basis for determining whether it was necessary to perform a quantitative assessment. If, after assessing qualitative factors, the Company determined it was not more likely than not that the fair value of a reporting unit was less than its carrying amount, then performing a quantitative assessment was unnecessary. If deemed necessary, a quantitative assessment compared the fair value of the reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit exceeded its carrying amount, goodwill was not considered impaired; otherwise, an impairment loss was recorded.

Leases

The Company categorizes leases at their commencement as either operating or finance leases. The Company recognizes operating lease ROU assets and operating lease liabilities for each lease arrangement identified. Lease liabilities are recorded at the present value of future lease payments discounted using the Company's incremental borrowing rate for the lease established at the commencement date. The incremental borrowing rate is the rate of interest the Company would have to pay to borrow, on a collateralized basis over a similar term and in a similar economic environment, an amount equal to the total lease payments. The Company primarily considers industry data, its credit rating and the lease term to determine its incremental borrowing rate. ROU assets are measured at the amount of the lease liability plus any initial direct costs, less any lease incentives received before commencement. Lease expense is recognized as a single lease cost over the lease term on a straight-line basis. The Company has elected not to apply the recognition requirements to short-term leases and not to separate non-lease components from lease components for its leases.

Clinical Studies

From time to time, the Company engages in efforts to scientifically measure and document the application and efficacy of its various testing products. These arrangements typically require the Company to pay a fee to a third-party scientific investigator (usually a physician or research institution) for each subject enrolled in a clinical study, and the Company accrues expenses based on estimated progress of services performed, including actual level of subjects enrolled and progress of the clinical studies. Payments made prior to the completion of clinical study services are capitalized as a prepaid expense. The prepaid amounts are expensed as the related goods are delivered or the services are performed, or when it is no longer expected that the goods will be delivered or the

services rendered. Expenses associated with clinical study activities are recorded in research and development expenses in the accompanying statement of operations.

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 recognizes revenue in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (ASC 606) and follows a five-step process to determine the amount and timing of revenue recognized: (1) identify the contract with the customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to performance obligations in the contract, and (5) recognize revenue when (or as) the performance obligation is satisfied. 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 generally billed at the Company's list price, unless a separate pricing contract is in place. 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 years ended December 31, 2023 and 2022 was a net revenue increase of $3.4 million and a net revenue decrease of $2.4 million, 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, along with any requested medical or other claims-related information to the healthcare insurers. This generally occurs within 30 to 90 days of billing, however, the amount and timing of any reimbursements or collections for our billed tests may vary by payor and other circumstances. 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 December 31, 2023. There was no allowance for credit losses recognized as of December 31, 2022. 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. Accounts receivable was $6.6 million, $6.1 million, $9.7 million for the years ended December 31, 2023, 2022 and 2021, respectively.

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; depreciation; amortization 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 $1.5 million and $3.0 million for the years ended December 31, 2023 and 2022, respectively, and are included in selling, general and administrative expenses in the accompanying statements of operations.

Shipping and Handling Costs

Costs incurred for shipping and handling are included in costs of revenue in the accompanying statements of operations and were approximately $2.5 million and $2.7 million for the years ended December 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, as we have concluded that our stock option exercise history does not provide a reasonable basis upon which to estimate the expected term. 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 (RSU) is determined on the grant date using the closing price of the Company's common stock on that date. The Company's RSUs 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 RSUs is subject to the holder's continued service with the Company. The Company issues new shares to satisfy RSUs 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.

Income Taxes

The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized as an expense in the period that includes the enactment date.

The Company recognizes net deferred tax assets to the extent that the Company believes these assets are more likely than not to be realized. In making such a determination, management considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If management determines that the Company would be able to realize its deferred tax assets in the future in excess of their net recorded amount, management would adjust the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

The Company records uncertain tax positions on the basis of a two-step process whereby (i) management determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (ii) for those tax positions that meet the more-likely-than-not recognition threshold, management recognizes the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits within income tax expense. Any accrued interest and penalties are included within the related tax liability.

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, RSUs 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 each of the years ended December 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):


	Year Ended December 31,
	2023	2022


Warrants to purchase common stock	409,108	409,108
Common stock options	986,819	1,421,235
Restricted stock units	1,387,459	1,036,208
Employee stock purchase plan	44,700	58,711
Total	2,828,086	2,925,262

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, Accounting Standards Updates (ASU) not included in the Company’s disclosures were assessed and determined to be either not applicable or are not expected to have a material impact on the Company’s financial statements or disclosures.

In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (ASU 2023-07), which requires public entities to disclose significant segment expenses that are regularly provided to the Chief Operating Decision Maker (CODM) and details of how the CODM uses financial reporting to assess the performance of a segment. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. This ASU will likely result in additional required disclosure when adopted. The Company is currently evaluating the provisions of this ASU and the impact on its financial statements and related disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which requires additional income tax disclosures in the rate reconciliation table for federal, state and foreign income taxes, in addition to more details about the reconciling items in some categories

when items meet a certain quantitative threshold. ASU 2023-09 is effective for annual periods beginning after December 15, 2024 with early adoption permitted. The Company is currently evaluating the impact of this standard, but does not expect that it will have a material impact on its financial statements.

Recently Adopted Accounting Standards

In June 2016, the FASB issued 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. The Company adopted this pronouncement on January 1, 2023. The adoption did not have material impact on its 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 early adopted ASU 2020-06 as of January 1, 2023. The adoption did not have an impact on its financial statements.

Stock Option Plan - Restricted Stock Units (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Weighted- Average Grant Date Fair Value
Outstanding, beginning balance (in dollars per share)	$ 2.40
Outstanding, ending balance (in dollars per share)	$ 1.99	$ 2.40
Restricted stock units
Number of Shares
Outstanding, beginning balance (in shares)	1,036,208
Awards granted (in shares)	857,300
Awards released (in shares)	(273,319)
Awards canceled (in shares)	(232,730)
Outstanding, ending balance (in shares)	1,387,459	1,036,208
Weighted- Average Grant Date Fair Value
Outstanding, beginning balance (in dollars per share)	$ 7.28
Awards granted (in dollars per share)	2.39	$ 5.89
Awards released (in dollars per share)	7.80
Awards canceled (in dollars per share)	6.80
Outstanding, ending balance (in dollars per share)	$ 4.24	$ 7.28
Aggregate Intrinsic Value
Outstanding, Aggregate Intrinsic Value	$ 2,761	$ 2,487

Income Taxes - Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Current:
Federal	$ 0	$ 0
State	(33)	(24)
Total current	(33)	(24)
Deferred:
Federal	0	137
State	0	169
Total deferred	0	306
Income tax (expense) benefit	$ (33)	$ 282

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Other Financial Information - Narrative (Details) - USD ($) $ in Thousands		12 Months Ended
	Oct. 24, 2023	Dec. 31, 2023	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Depreciation and amortization		$ 2,200	$ 1,600
Operating lease right-of-use assets		3,286	4,885
Operating lease liabilities		976	1,040
Loss on lease assignment	$ 1,500	1,470	0
Long-lived assets impairment		0	397
Goodwill impairment		0	5,506
Laboratory equipment
Property, Plant and Equipment [Line Items]
Gross book value of assets under finance leases		$ 2,500	$ 2,800
Building
Property, Plant and Equipment [Line Items]
Operating lease right-of-use assets	700
Operating lease liabilities	800
Leasehold improvements	$ 1,600

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense (Benefit)

The provision for income taxes consists of the following (in thousands):


	Year Ended December 31,
	2023		2022
Current:
Federal	$	—	$	—
State	(33)		(24)
Total current	(33)		(24)
Deferred:
Federal	—		137
State	—		169
Total deferred	—		306
Income tax (expense) benefit	$	(33)	$	282

Schedule of Effective Income Tax Rate Reconciliation

The effective tax rate of our provision for income taxes differs from the federal statutory rate as follows:


	Year Ended December 31,
	2023		2022
Federal statutory tax rate	21.0	%	21.0	%
State income taxes, net of federal tax benefits	2.2	%	4.3	%
Research and development tax credits	0.1	%	1.5	%
Stock compensation	(3.4)	%	(1.4)	%
Non-deductible expenses	(1.4)	%	(0.9)	%
Change in valuation allowance	(18.5)	%	(23.9)	%
Other	(0.1)	%	—	%
Effective tax rate	(0.1)	%	0.6	%

Schedule of Deferred Tax Assets and Liabilities

If the Company’s judgment changes and it is determined that the Company will be able to realize these deferred tax assets, the tax benefits relating to any reversal of the valuation allowance on deferred tax assets will be accounted for as a reduction to income tax expense.


	December 31,
	2023		2022
Deferred tax assets:
Net operating loss carryforwards	$	32,479	$	29,789
Research and development tax credits	2,353		2,216
Accruals, reserves and other	1,119		349
Interest expense	2,547		2,236
Indefinite lived assets	300		362
Stock compensation	1,391		1,606
Lease liability	925		1,374
Capitalization of research and experimentation costs	2,929		2,047
Total gross deferred tax assets	44,043		39,979
Less: valuation allowance	(42,942)		(38,567)
Deferred tax assets, net	1,101		1,412
Deferred tax liabilities:


Right of use assets	(814)		(1,206)
Basis differences in fixed and intangible assets	(287)		(206)
Deferred tax liabilities	(1,101)		(1,412)
Net deferred tax assets	$	—	$	—

Summary of Valuation Allowance

Changes in the valuation allowance for deferred tax assets during the years ended December 31, 2023 and 2022, which related primarily to increases in net operating loss (NOL) carryforwards, research and development tax credits, capitalization of research and experimentation costs, and impairment of goodwill were as follows (in thousands):


	December 31,
	2023		2022
Valuation allowance at the beginning of the year	$	38,567	$	27,158
Increases recorded to income tax provision	4,375		11,409
Valuation allowance at the end of the year	$	42,942	$	38,567

Leases - Costs Associated with the Company's Leases (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Leases [Abstract]
Operating lease cost	$ 1,463	$ 1,540
Amortization of lease assets	556	679
Interest on finance lease liabilities	128	80
Total lease cost	2,147	2,299
Variable lease cost	$ 129	$ 165

Fair Value Measurements (Tables)

12 Months Ended

Dec. 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):


	December 31, 2023
	Total		Level 1		Level 2		Level 3
Assets:
Money market funds, included in cash and cash equivalents	$	14,386	$	14,386	$	—	$	—


	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	$	—	$	—

Other Financial Information

12 Months Ended

Dec. 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):


	December 31,
	2023		2022
Diagnostic testing supplies	$	2,871	$	1,795
Prepaid product royalties	35		40
Prepaid maintenance and insurance contracts	1,860		2,072
Other prepaid expenses and other current assets	31		236
Prepaid expenses and other current assets	$	4,797	$	4,143

Property and Equipment

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


	December 31,
	2023		2022
Furniture and fixtures	$	98	$	98
Laboratory equipment	5,312		5,136
Computer equipment and software	2,185		1,482
Leasehold improvements	3,316		5,223
Construction in progress	59		1,382
Total property and equipment	10,970		13,321
Less: accumulated depreciation and amortization	(5,769)		(5,124)
Property and equipment, net	$	5,201	$	8,197

Depreciation and amortization expense for the years ended December 31, 2023 and 2022, was approximately $2.2 million and $1.6 million, respectively. At December 31, 2023 and 2022, the gross book value of assets under finance leases was $2.5 million and $2.8 million, respectively, and is classified in "Laboratory equipment" in the table above.

Loss on Lease Assignment

On October 24, 2023, the Company entered into an assignment and assumption (the Assignment and Assumption Agreement) of the Company’s previously executed lease agreement with Liberty Vista, LP (formerly known as Geiger Court, LLC) and Mindera Corporation (Mindera), pursuant to which the Company assigned to Mindera the lease of a building located adjacent to the Company's headquarters in Vista, CA. Under the terms of the Assignment and Assumption Agreement, Mindera assumed all obligations under the lease, effective October 31, 2023. As a result of the lease assignment, the Company derecognized the remaining balances related to the associated operating lease ROU asset of $0.7 million, operating lease liability of $0.8 million and leasehold improvements of $1.6 million, resulting in a $1.5 million loss on lease assignment. The loss was classified within selling, general and administrative expenses in the accompanying statements of operations.

Impairment of Long-Lived Assets and Goodwill

During the year ended December 31, 2022, the Company recorded an impairment charge of $0.4 million related to previously capitalized equipment used in research and development activities that were halted in the fourth quarter of 2022. The impairment charge was classified within research and development expenses in the accompanying statements of operations.

During the year ended December 31, 2022, the Company also determined that a sustained decrease in its market capitalization constituted an indicator of impairment of goodwill and as a result, instead of performing a qualitative test, the Company chose to proceed directly to performing a quantitative test during the fourth quarter. The Company determined the fair value of the reporting unit using the discounted cash flow (DCF) method, which is considered a Level 3 measurement. In applying the DCF method, cash flows are estimated for a five-year financial forecast developed by management. A terminal value, which represents the value of additional cash flows into perpetuity, is also calculated. Cash flows are then discounted to present value at a discount rate commensurate with their risk. Based on this analysis, the carrying value of the reporting unit was in excess of the fair value and the goodwill was fully impaired. During the year ended December 31, 2022, the Company recorded a goodwill impairment charge of $5.5 million.

The following table presents details of the Company's goodwill for the year ended December 31, 2022 (in thousands):


	Total
Balance as of December 31, 2021	$	5,506
Goodwill impairment	(5,506)
Balance as of December 31, 2022	$	—

Accrued and Other Current Liabilities

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


	December 31,
	2023		2022
Accrued payroll and related expenses	$	4,738	$	2,355
Accrued interest	139		142
Accrued purchases of goods and services	720		803
Accrued royalties	463		514
Accrued clinical study activity	118		162
Finance lease obligations, current portion	490		700
Refund liability	302		445
Other accrued liabilities	561		226
Accrued and other current liabilities	$	7,531	$	5,347

Borrowings - Future Minimum Payments (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Debt Disclosure [Abstract]
2024	$ 1,949
2025	1,974
2026	21,243
Total	25,166
Unamortized debt discount and issuance costs	(113)
Interest	(5,558)
Total borrowings, net of discounts and debt issuance costs	19,495
Borrowings-current portion	(264)	$ (190)
Borrowings-non-current portion, net of discounts and debt issuance costs	$ 19,231	$ 28,778

Stock Option Plan - Common Stock Reserved For Future Issuance (Details)	Dec. 31, 2023 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)	5,868,776
Warrants to purchase common stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)	1,214,059
Common stock option grants issued and outstanding
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)	986,819
Common stock reserved for issuance upon vesting of outstanding restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)	1,387,459
Common shares available for grant under the 2019 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)	1,831,107
Common shares available for future issuance under ESPP
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)	449,332

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
-SubTopic 10
-Name Accounting Standards Codification
-Section 35
-Paragraph 1D
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480483/718-10-35-1D

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
-SubTopic 10
-Name Accounting Standards Codification
-Section 35
-Paragraph 3
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480483/718-10-35-3

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)(1)
-Publisher FASB
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+ Details

Commitment and Contingencies - Narrative (Details) $ in Millions		1 Months Ended		12 Months Ended
	Oct. 31, 2023 USD ($)	Dec. 31, 2021 supplier	May 31, 2021 USD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)
Other Commitments [Line Items]
Number of suppliers in amended supply agreement \| supplier		1
Purchase obligation, due in next twelve months					$ 8.0
Purchase obligation, due in second year					9.2
U.S. Department Of Justice Case \| Settled Litigation
Other Commitments [Line Items]
Settlement payment	$ 0.7
AHN Collaboration
Other Commitments [Line Items]
Collaboration agreement, collaboration expenses				$ 0.3	$ 0.3
Minimum \| Licensing Agreements
Other Commitments [Line Items]
Royalty obligation, percent of net sales				1.50%
Maximum \| Licensing Agreements
Other Commitments [Line Items]
Royalty obligation, percent of net sales				7.00%
Prometheus Laboratories \| Minimum
Other Commitments [Line Items]
Royalty obligation, percent of net sales				2.50%
Allegheny Health Network Research Institute
Other Commitments [Line Items]
Collaboration fee			$ 0.4

Stock Option Plan - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 3,617	$ 4,704
Cost of revenue
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	191	213
Selling, general and administrative
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	3,174	3,860
Research and development
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 252	$ 631

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

+ Details

Leases (Tables)

12 Months Ended

Dec. 31, 2023

Leases [Abstract]

Schedule of Lease Costs

Operating and finance leases consist of the following (in thousands):


		December 31,
Lease Balance	Classification	2023		2022
Lease Assets
Operating	Operating lease right-of-use assets	$	3,286	$	4,885
Finance	Property and equipment, net	$	810	$	1,427

Lease Liabilities
Current
Operating	Operating lease liabilities	$	976	$	1,040
Finance	Accrued and other current liabilities	$	490	$	700
Non-current
Operating	Non-current operating lease liabilities	$	2,760	$	4,493
Finance	Other non-current liabilities	$	358	$	848

Costs associated with the Company's leases were included in the statements of operations as follows (in thousands):


	Year Ended December 31,
Lease Cost	2023		2022
Operating leases
Operating lease cost(1)	$	1,463	$	1,540
Finance lease cost
Amortization of lease assets	556		679
Interest on finance lease liabilities	128		80
Total lease cost	$	2,147	$	2,299

(1) Includes variable lease cost of $129,000 and $165,000 for the years ended December 31, 2023 and 2022, respectively.

Supplemental cash flow information on leases is as follows (in thousands):


	Year Ended December 31,
Cash paid for amounts included in the measurement of lease liabilities	2023		2022
Operating cash out flows from operating leases	$	1,405	$	1,262
Operating cash out flows from interest paid on finance leases	$	128	$	80
Financing cash out flows from finance leases	$	697	$	667

Information regarding the weighted-average lease term and weighted average discount rate are as follows:


	Year Ended December 31,
	2023		2022
Weighted-average remaining lease term (years)
Operating leases	3.3		4.3
Finance leases	2.06		1.94
Weighted-average discount rate
Operating leases	8.0	%	8.0	%
Finance leases	12.2	%	4.8	%

Schedule of Lessee, Operating Lease, Liability, Maturity

Future payments under operating and finance leases as of December 31, 2023 are as follows (in thousands):


	Operating Leases		Finance Leases


2024	$	1,240	$	574
2025	1,277		248
2026	1,315		147
2027	445		28
Total minimum lease payments	4,277		997
Less: imputed interest	(541)		(149)
Total lease liabilities	3,736		848
Less: current portion	(976)		(490)
Lease obligations, net of current portion	$	2,760	$	358

Schedule of Finance Lease, Liability, Maturity

Future payments under operating and finance leases as of December 31, 2023 are as follows (in thousands):


	Operating Leases		Finance Leases


2024	$	1,240	$	574
2025	1,277		248
2026	1,315		147
2027	445		28
Total minimum lease payments	4,277		997
Less: imputed interest	(541)		(149)
Total lease liabilities	3,736		848
Less: current portion	(976)		(490)
Lease obligations, net of current portion	$	2,760	$	358

Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
Statements of Cash Flows - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Cash flows from operating activities:
Net loss	$ (23,689)	$ (47,387)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	2,168	1,557
Amortization of debt discount and debt issuance costs	156	161
Non-cash interest expense	363	551
Deferred income taxes	0	(306)
Loss on disposal of assets	189	0
Loss on lease assignment	1,470	0
Non-cash lease expense	939	967
Long-lived assets impairment	0	397
Goodwill impairment	0	5,506
Stock-based compensation	3,617	4,704
Other	0	36
Changes in assets and liabilities:
Accounts receivable, net	(474)	3,577
Prepaid expenses and other current assets	(654)	(505)
Other assets	(101)	(47)
Operating lease liabilities	(1,010)	(854)
Accounts payable	67	901
Accrued and other current liabilities	2,497	(1,402)
Net cash used in operating activities	(14,462)	(32,144)
Cash flows from investing activities:
Purchases of property and equipment	(828)	(4,318)
Proceeds from disposal of property and equipment	24	0
Net cash used in investing activities	(804)	(4,318)
Cash flows from financing activities:
Proceeds from exercise of stock options	27	61
Payments of taxes withheld on vested restricted stock units	0	(239)
Proceeds from common stock issued under Employee Stock Purchase Plan	279	385
Principal payment on finance lease obligations	(697)	(667)
Principal payment on note payable obligations	(241)	(29)
Principal payment on long-term debt	(10,000)	0
Net cash used in financing activities	(10,632)	(489)
Net change in cash, cash equivalents and restricted cash	(25,898)	(36,951)
Cash, cash equivalents and restricted cash, beginning of year	62,591	99,542
Cash, cash equivalents and restricted cash, end of year	36,693	62,591
Supplemental disclosure of cash flow information:
Cash paid for interest expense	1,737	1,732
Supplemental disclosure of non-cash items:
Equipment purchased under finance lease obligations	0	741
Equipment purchased under notes payable obligations	250	807
Costs incurred, but not paid, in connection with capital expenditures	$ 66	$ 182

Leases - Future Payments Under Operating And Finance Leases (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Operating Leases
2024	$ 1,240
2025	1,277
2026	1,315
2027	445
Total minimum lease payments	4,277
Less: imputed interest	(541)
Total lease liabilities	3,736
Less: current portion	(976)	$ (1,040)
Lease obligations, net of current portion	2,760	4,493
Finance Leases
2024	574
2025	248
2026	147
2027	28
Total minimum lease payments	997
Less: imputed interest	(149)
Total lease liabilities	848
Less: current portion	(490)	(700)
Lease obligations, net of current portion	$ 358	$ 848

Income Taxes - Change In Valuation Allowance (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Changes In The Valuation Allowance For Deferred Tax Assets [Roll Forward]
Valuation allowance at the beginning of the year	$ 38,567	$ 27,158
Increases recorded to income tax provision	4,375	11,409
Valuation allowance at the end of the year	$ 42,942	$ 38,567

Income Taxes - Reconciliation of Effective Income Tax Rate (Details)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Income Tax Disclosure [Abstract]
Federal statutory tax rate	21.00%	21.00%
State income taxes, net of federal tax benefits	2.20%	4.30%
Research and development tax credits	0.10%	1.50%
Stock compensation	(3.40%)	(1.40%)
Non-deductible expenses	(1.40%)	(0.90%)
Change in valuation allowance	(18.50%)	(23.90%)
Other	(0.10%)	0.00%
Effective tax rate	(0.10%)	0.60%

Borrowings

12 Months Ended

Dec. 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 (the Amended Loan Agreement), pursuant to which the Company borrowed $25.0 million. At December 31, 2023, no additional amounts remained available to borrow under the Amended Loan Agreement.

On April 28, 2023, the Company entered into the Amended Loan Agreement. The Amended Loan Agreement was treated as a modification. In connection with the Amended Loan Agreement, the Company repaid $10.0 million of the principal balance outstanding, for which the prepayment premium was waived. Pursuant to the Amended Loan Agreement, the interest rate on all borrowings under the Amended Loan Agreement is the sum (the Basic Rate) of (a) the greater of 8.0% or The Wall Street Journal prime rate (the Prime Rate), plus (b) 2.0%, which is paid-in-kind in the form of additional term loans (PIK Loans). Under the Amended Loan Agreement, an amount equal to 1.5% of the Basic Rate will be payable in-kind and capitalized to the principal amount of the outstanding term loan on a monthly basis until April 1, 2026, after which interest is scheduled to accrue at the Basic Rate. The maturity date of the loan was extended to December 31, 2026. The Company estimated the effective interest rate of this loan to be approximately 11.0% and 8.5% as of December 31, 2023 and 2022, respectively. Accrued interest is due and payable monthly, unless the Company elects to pay paid-in-kind interest. The outstanding principal and accrued interest under the Amended Loan Agreement is to be repaid in ten equal monthly installments commencing in April 2026. Upon repayment of the final installment under the Amended Loan Agreement, 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 using the effective interest method. For the years ended December 31, 2023 and 2022, the Company issued PIK Loans totaling $0.4 million and $0.6 million, respectively. At December 31, 2023, $18.2 million in principal and PIK loans are outstanding, all of which is included in borrowings-non-current portion on the accompanying balance sheet.

The Amended Loan Agreement currently requires a prepayment premium of 1% of the aggregate outstanding principal for any prepayments made prior to November 1, 2024.

The Amended Loan Agreement is collateralized by a first priority security interest in substantially all of the Company's assets, including intellectual property. The affirmative covenants of the Amended Loan Agreement 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, however the Company is not required to comply with the revenue covenant for any quarter during which it maintains a minimum aggregate cash balance equal to fifty percent of the aggregate principal amount of the Amended Loan Agreement (excluding any capitalized interest paid-in-kind) at all times during such quarter. The consequences of failing to achieve the performance covenants, when applicable, will be cured if, (i) within thirty days of failing to achieve the performance covenant, the Company submits a new Board approved financial plan to Innovatus under which the Company is expected to break even on a cash flow basis prior to the maturity date, and (ii) within thirty days of the submission of such financial plan, the Company issues additional equity securities or subordinated debt with net proceeds sufficient to fund any cash flow deficiency generated from operations, as defined in the Amended Loan Agreement. The Amended Loan Agreement 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 Amended Loan 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.

At December 31, 2023, the Company was in compliance with all covenants of the Amended Loan Agreement.

Upon an event of default in any of the Amended Loan Agreement covenants, the repayment of the 2017 Term Loan may be accelerated, and the applicable interest rate will be increased by 4.0% until the default is cured. Although repayment of the 2017 Term Loan can be accelerated under certain circumstances, the Company believes acceleration of this loan is not probable as of the date of these financial statements. Accordingly, the Company has reflected the amounts of the Third 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 December 31, 2023, the total notes payable balance related to this financed equipment was $0.8 million, with $0.3 million classified within borrowings-current portion and $0.5 million within borrowings-non-current portion, net of discounts and debt issuance costs in the accompanying balance sheets. At December 31, 2022, the total notes payable balance related to this financed equipment was $0.8 million, with $0.2 million classified within borrowings-current portion and $0.6 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 Outstanding Borrowings

As of December 31, 2023, future minimum aggregate payments, including interest, for outstanding borrowings are as follows (in thousands):


	Years Ending December 31,




2024	1,949
2025	1,974
2026	21,243


Total	25,166
Less:
Unamortized debt discount and issuance costs	(113)
Interest	(5,558)
Total borrowings, net of discounts and debt issuance costs	19,495
Less: Borrowings-current portion	(264)
Borrowings-non-current portion, net of discounts and debt issuance costs	$	19,231

- 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.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 470
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//470/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (g)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
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-Section 50
-Paragraph 1B
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
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-Publisher FASB
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
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-Publisher FASB
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
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-Section 50
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-Subparagraph (c)
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-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
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-Section 50
-Paragraph 1E
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1E

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
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-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

+ Details

Other Financial Information - Prepaid Expenses (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Other Financial Information [Abstract]
Diagnostic testing supplies	$ 2,871	$ 1,795
Prepaid product royalties	35	40
Prepaid maintenance and insurance contracts	1,860	2,072
Other prepaid expenses and other current assets	31	236
Prepaid expenses and other current assets	$ 4,797	$ 4,143

Summary of Significant Accounting Policies - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Disaggregation of Revenue [Line Items]
Revenue	$ 52,548	$ 45,563
Commercial
Disaggregation of Revenue [Line Items]
Revenue	23,985	18,975
Government
Disaggregation of Revenue [Line Items]
Revenue	18,002	17,687
Client
Disaggregation of Revenue [Line Items]
Revenue	9,949	7,928
Other
Disaggregation of Revenue [Line Items]
Revenue	$ 612	$ 973

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

- 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.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 924
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479941/924-10-S99-1

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 5
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-5

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 30
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-30

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 42
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-42

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-22

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
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-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-32

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Name Accounting Standards Codification
-Section 50
-Paragraph 40
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-40

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
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-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-32

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 41
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-41

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 4
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-4

+ Details

Fair Value Measurements (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Total borrowings, net of discounts and debt issuance costs	$ 19,495
Recurring
Assets:
Total		$ 59,538
Recurring \| Money market funds, included in cash and cash equivalents
Assets:
Cash and cash equivalents, fair value disclosure	14,386	29,438
Recurring \| Certificate of deposit, included in cash and cash equivalents
Assets:
Cash and cash equivalents, fair value disclosure		30,100
Recurring \| Level 1
Assets:
Total		59,538
Recurring \| Level 1 \| Money market funds, included in cash and cash equivalents
Assets:
Cash and cash equivalents, fair value disclosure	14,386	29,438
Recurring \| Level 1 \| Certificate of deposit, included in cash and cash equivalents
Assets:
Cash and cash equivalents, fair value disclosure		30,100
Recurring \| Level 2
Assets:
Total		0
Recurring \| Level 2 \| Money market funds, included in cash and cash equivalents
Assets:
Cash and cash equivalents, fair value disclosure	0	0
Recurring \| Level 2 \| Certificate of deposit, included in cash and cash equivalents
Assets:
Cash and cash equivalents, fair value disclosure		0
Recurring \| Level 3
Assets:
Total		0
Recurring \| Level 3 \| Money market funds, included in cash and cash equivalents
Assets:
Cash and cash equivalents, fair value disclosure	0	0
Recurring \| Level 3 \| Certificate of deposit, included in cash and cash equivalents
Assets:
Cash and cash equivalents, fair value disclosure		0
Amended Loan Agreement \| Recurring \| Level 2
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Total borrowings, net of discounts and debt issuance costs	18,700
Debt instrument, fair value	$ 19,700
2017 Term Loan \| Recurring \| Level 2
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Total borrowings, net of discounts and debt issuance costs		28,300
Debt instrument, fair value		26,900
Debt Other Than Amended Loan Agreement \| Recurring \| Level 2
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Total borrowings, net of discounts and debt issuance costs		$ 800

Summary of Significant Accounting Policies - Securities (Details) - shares	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Class of Stock [Line Items]
Anti-dilutive securities excluded from computation (in shares)	2,828,086	2,925,262
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)	986,819	1,421,235
Restricted stock units
Class of Stock [Line Items]
Anti-dilutive securities excluded from computation (in shares)	1,387,459	1,036,208
Employee stock purchase plan
Class of Stock [Line Items]
Anti-dilutive securities excluded from computation (in shares)	44,700	58,711

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (d)
-Publisher FASB
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Reference 2: http://www.xbrl.org/2003/role/recommendedDisclosureRef
-Topic 272
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-Name Accounting Standards Codification
-Section 45
-Paragraph 3
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483014/272-10-45-3

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 272
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482987/272-10-50-1

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 235
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-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(d))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

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-Section 50
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-Publisher FASB
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
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-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 210
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-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(27)(b))
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 210
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(28))
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
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-Name Accounting Standards Codification
-Section 50
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-Publisher FASB
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 210
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480566/210-10-S99-1

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
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-Subparagraph (SX 210.6-03(i)(2))
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-URI https://asc.fasb.org//1943274/2147479886/946-10-S99-3

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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-Name Accounting Standards Codification
-Section S99
-Paragraph 3
-Subparagraph (SX 210.6-03(i)(1))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479886/946-10-S99-3

Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 3
-Subparagraph (SX 210.6-03(i)(2)(i))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479886/946-10-S99-3

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 3
-Subparagraph (SX 210.6-03(i)(2)(ii))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479886/946-10-S99-3

+ Details

Income Taxes

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Income Taxes

The provision for income taxes consists of the following (in thousands):


	Year Ended December 31,
	2023		2022
Current:
Federal	$	—	$	—
State	(33)		(24)
Total current	(33)		(24)
Deferred:
Federal	—		137
State	—		169
Total deferred	—		306
Income tax (expense) benefit	$	(33)	$	282

The effective tax rate of our provision for income taxes differs from the federal statutory rate as follows:


	Year Ended December 31,
	2023		2022
Federal statutory tax rate	21.0	%	21.0	%
State income taxes, net of federal tax benefits	2.2	%	4.3	%
Research and development tax credits	0.1	%	1.5	%
Stock compensation	(3.4)	%	(1.4)	%
Non-deductible expenses	(1.4)	%	(0.9)	%
Change in valuation allowance	(18.5)	%	(23.9)	%
Other	(0.1)	%	—	%
Effective tax rate	(0.1)	%	0.6	%

Significant components of the Company’s deferred tax assets at December 31, 2023 and 2022 are shown below (in thousands). A valuation allowance has been established as realization of the Company’s deferred tax assets has not met the more likely-than-not threshold requirement. If the Company’s judgment changes and it is determined that the Company will be able to realize these deferred tax assets, the tax benefits relating to any reversal of the valuation allowance on deferred tax assets will be accounted for as a reduction to income tax expense.


	December 31,
	2023		2022
Deferred tax assets:
Net operating loss carryforwards	$	32,479	$	29,789
Research and development tax credits	2,353		2,216
Accruals, reserves and other	1,119		349
Interest expense	2,547		2,236
Indefinite lived assets	300		362
Stock compensation	1,391		1,606
Lease liability	925		1,374
Capitalization of research and experimentation costs	2,929		2,047
Total gross deferred tax assets	44,043		39,979
Less: valuation allowance	(42,942)		(38,567)
Deferred tax assets, net	1,101		1,412
Deferred tax liabilities:


Right of use assets	(814)		(1,206)
Basis differences in fixed and intangible assets	(287)		(206)
Deferred tax liabilities	(1,101)		(1,412)
Net deferred tax assets	$	—	$	—


	December 31,
	2023		2022
Valuation allowance at the beginning of the year	$	38,567	$	27,158
Increases recorded to income tax provision	4,375		11,409
Valuation allowance at the end of the year	$	42,942	$	38,567

At December 31, 2023 and 2022, the Company had federal NOL carryforwards of approximately $129.8 million and $118.4 million, respectively. At December 31, 2023 and 2022, the Company had state NOL carryforwards of $91.0 million and $87.0 million, respectively. Approximately $43.5 million of the federal tax loss carryforwards will begin to expire in 2024, unless previously utilized. The federal NOL carryforwards generated after December 31, 2017 of $86.3 million will carryforward indefinitely. The Company’s state tax loss carryforwards will begin to expire in 2030, unless previously utilized.

At December 31, 2023, the Company's deferred tax assets are primarily comprised of federal and state tax NOL carryforwards. The Company completed a formal study through the year ended December 31, 2019 and determined ownership changes within the meaning of Internal Revenue Code (IRC), Section 382 had occurred in 2003, 2008, 2012, 2017 and 2019. Based on the analysis, $61.1 million of the Company's tax attribute carryforwards through December 31, 2017 cannot be utilized under IRC Section 382. The Company's ability to utilize NOL carryforwards generated after December 31, 2017 will not expire under the Tax Cuts and Jobs Act of 2017. The Company adjusted tax attribute carry forwards and deferred tax assets accordingly. As the deferred tax assets associated with the tax attribute carry forwards were fully offset by a valuation allowance, a corresponding reduction in the Company's valuation allowance was also recorded, resulting in no income tax impact.

The Company is subject to taxation in the U.S. and in various state jurisdictions. The Company’s tax years for 2004 and forward are subject to examination by the U.S. and state tax authorities due to the carryforward of unutilized net operating losses and research and development credits.

The Company recognizes interest and/or penalties related to income tax matters in its provision for income taxes. The Company does not have any material accruals for, and did not recognize any, material interest or penalties in these financial statements in any period presented.

Uncertain Tax Positions

At December 31, 2023 and 2022, the Company had no unrecognized tax benefits.

The Company does not believe that the balance of unrecognized tax benefits will materially change within the next twelve months.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//740/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-14

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 21
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-21

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 270
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482526/740-270-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
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-Section 50
-Paragraph 17
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-17

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 30
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482603/740-30-50-2

+ Details

401(k) Plan (Details) - USD ($) $ in Millions	12 Months Ended
401(k) Plan (Details) - USD ($) $ in Millions	Dec. 31, 2023	Dec. 31, 2022
Retirement Benefits [Abstract]
Qualified employee compensation, employer matching contribution, percent of employees' gross pay	4.00%
Qualified employee compensation contribution, amount	$ 0.8	$ 0.9

Statements of Operations - USD ($) $ in Thousands	12 Months Ended
Statements of Operations - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Income Statement [Abstract]
Revenue	$ 52,548	$ 45,563
Operating expenses:
Costs of revenue	23,092	24,214
Selling, general and administrative expenses	47,428	52,018
Research and development expenses	4,865	9,876
Goodwill impairment	0	5,506
Total operating expenses	75,385	91,614
Loss from operations	(22,837)	(46,051)
Interest expense	(2,335)	(2,448)
Interest income	1,516	830
Loss before income taxes	(23,656)	(47,669)
Income tax (expense) benefit	(33)	282
Net loss	$ (23,689)	$ (47,387)
Net loss per share, basic (in dollars per share)	$ (1.34)	$ (2.77)
Net loss per share, diluted (in dollars per share)	$ (1.34)	$ (2.77)
Weighted-average number of shares used to compute net loss per share, basic (in shares)	17,679,467	17,082,348
Weighted-average number of shares used to compute net loss per share, diluted (in shares)	17,679,467	17,082,348

Income Taxes - Narrative (Details) - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Tax Credit Carryforward [Line Items]
Federal net operating loss carryforwards	$ 129,800,000	$ 118,400,000
State net operating loss carryforwards	91,000,000.0	87,000,000.0
Federal tax loss carryforwards, subject to expiration	43,500,000
Federal net operating loss carryforwards, carryforward indefinitely	86,300,000
Unrecognized tax benefits	0	$ 0
Tax Years Through December 31, 2017
Tax Credit Carryforward [Line Items]
Federal tax loss carryforwards, subject to expiration	$ 61,100,000

Leases - Lease Balances (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Leases [Abstract]
Operating lease right-of-use assets	$ 3,286	$ 4,885
Finance lease, right-of-use asset, after accumulated amortization	$ 810	1,427
Finance lease, right-of-use asset, statement of financial position	Property and equipment, net
Operating lease liabilities	$ 976	1,040
Finance lease obligations, current portion	$ 490	$ 700
Finance lease, liability, current, statement of financial position	Accrued and other current liabilities	Accrued and other current liabilities
Non-current operating lease liabilities	$ 2,760	$ 4,493
Lease obligations, net of current portion	$ 358	$ 848
Finance lease, liability, noncurrent, statement of financial position	Non-current operating lease liabilities	Non-current operating lease liabilities

Summary of Significant Accounting Policies - Narrative (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2023 USD ($) installment segment unit	Dec. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Restricted cash	$ 200	$ 200
Number of operating segments \| segment	1
Number of reporting units \| unit	1
Revenue recognized	$ 3,400	(2,400)
Allowance for credit loss	0	0
Accounts receivable, net	6,551	6,077	$ 9,700
Advertising and marketing costs	$ 1,500	3,000
Expected dividend rate	0.00%
Number of annual vesting installments \| installment	4
Minimum
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Property, plant and equipment, useful life	3 years
Maximum
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Property, plant and equipment, useful life	5 years
Shipping and Handling
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cost of revenue	$ 2,500	$ 2,700
Revenue \| Supplier Concentration Risk \| Two Suppliers
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Concentration risk percentage	96.00%	96.00%
Revenue \| AVISE CTD Test \| Product Concentration Risk
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Concentration risk percentage	88.00%	84.00%

Organization (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Cash and cash equivalents	$ 36,493	$ 62,391
Accumulated deficit	$ 279,216	$ 255,527

- Definition

Amount of accumulated undistributed earnings (deficit).

+ References + Details

Organization	12 Months Ended
Organization	Dec. 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 which exists to provide clarity in autoimmune disease decision making with the goal of improving patients' clinical outcomes. 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. At December 31, 2023, the Company had cash and cash equivalents of $36.5 million and had an accumulated deficit of $279.2 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 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.

Summary of Significant Accounting Policies - Revenue by Major Payers (Details) - Customer Concentration Risk	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Medicare \| Revenue
Disaggregation of Revenue [Line Items]
Concentration risk percentage	34.00%	39.00%
Medicare \| Accounts Receivable
Disaggregation of Revenue [Line Items]
Concentration risk percentage	42.00%	21.00%
Medicare Advantage \| Revenue
Disaggregation of Revenue [Line Items]
Concentration risk percentage	17.00%	15.00%
Medicare Advantage \| Accounts Receivable
Disaggregation of Revenue [Line Items]
Concentration risk percentage	16.00%	13.00%

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

Other Financial Information (Tables)

12 Months Ended

Dec. 31, 2023

Other Financial Information [Abstract]

Schedule of Prepaid Expenses and Other Current Assets

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


	December 31,
	2023		2022
Diagnostic testing supplies	$	2,871	$	1,795
Prepaid product royalties	35		40
Prepaid maintenance and insurance contracts	1,860		2,072
Other prepaid expenses and other current assets	31		236
Prepaid expenses and other current assets	$	4,797	$	4,143

Schedule of Property and Equipment

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


	December 31,
	2023		2022
Furniture and fixtures	$	98	$	98
Laboratory equipment	5,312		5,136
Computer equipment and software	2,185		1,482
Leasehold improvements	3,316		5,223
Construction in progress	59		1,382
Total property and equipment	10,970		13,321
Less: accumulated depreciation and amortization	(5,769)		(5,124)
Property and equipment, net	$	5,201	$	8,197

Schedule of Goodwill

The following table presents details of the Company's goodwill for the year ended December 31, 2022 (in thousands):


	Total
Balance as of December 31, 2021	$	5,506
Goodwill impairment	(5,506)
Balance as of December 31, 2022	$	—

Schedule of Accrued and Other Current Liabilities

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


	December 31,
	2023		2022
Accrued payroll and related expenses	$	4,738	$	2,355
Accrued interest	139		142
Accrued purchases of goods and services	720		803
Accrued royalties	463		514
Accrued clinical study activity	118		162
Finance lease obligations, current portion	490		700
Refund liability	302		445
Other accrued liabilities	561		226
Accrued and other current liabilities	$	7,531	$	5,347

- Definition

Tabular disclosure of goodwill by reportable segment and in total which includes a rollforward schedule.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Topic 350
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-Name Accounting Standards Codification
-Section 55
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Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
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-Name Accounting Standards Codification
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-Paragraph 1
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Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
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-Paragraph 1
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Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
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-Name Accounting Standards Codification
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-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 5: http://www.xbrl.org/2009/role/commonPracticeRef
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-Name Accounting Standards Codification
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Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 9: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
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Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 11: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 12: http://www.xbrl.org/2009/role/commonPracticeRef
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-Section 50
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-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-2

+ Details

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 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
	Year Ended December 31,
	2023		2022
Medicare	34	%	39	%
Medicare Advantage	17	%	15	%


	Accounts Receivable
	December 31,
	2023		2022
Medicare	42	%	21	%
Medicare Advantage	16	%	13	%

Schedule of Disaggregation of Revenue

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


	Year Ended December 31,
	2023		2022
Revenue:
Commercial	$	23,985	$	18,975
Government	18,002		17,687
Client(1)	9,949		7,928
Other(2)	612		973
Total revenue	$	52,548	$	45,563

(1)Includes hospitals, other laboratories, etc.

(2)Includes patient self-pay.

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):


	December 31,
	2023		2022
Cash and cash equivalents	$	36,493	$	62,391
Restricted cash	200		200
	$	36,693	$	62,591

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):


	December 31,
	2023		2022
Cash and cash equivalents	$	36,493	$	62,391
Restricted cash	200		200
	$	36,693	$	62,591

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):


	Year Ended December 31,
	2023	2022


Warrants to purchase common stock	409,108	409,108
Common stock options	986,819	1,421,235
Restricted stock units	1,387,459	1,036,208
Employee stock purchase plan	44,700	58,711
Total	2,828,086	2,925,262

Cover - USD ($) $ in Millions	12 Months Ended
Cover - USD ($) $ in Millions	Dec. 31, 2023	Mar. 14, 2024	Jun. 30, 2023
Cover [Abstract]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Dec. 31, 2023
Current Fiscal Year End Date	--12-31
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 Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
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
ICFR Auditor Attestation Flag	false
Document Financial Statement Error Correction	false
Entity Shell Company	false
Entity Public Float			$ 37.3
Entity Common Stock, Shares Outstanding		17,235,751
Documents Incorporated by Reference	Certain information required to be disclosed in Part III of this report is incorporated by reference from the registrant's definitive Proxy Statement for the 2024 Annual Meeting of Stockholders, which proxy statement will be filed not later than 120 days after the end of the fiscal year covered by this Form 10-K.
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Central Index Key	0001274737

Borrowings - Narrative (Details)		1 Months Ended	12 Months Ended
Borrowings - Narrative (Details)	Apr. 28, 2023 USD ($)	Sep. 30, 2017 USD ($)	Dec. 31, 2023 USD ($) installment	Dec. 31, 2022 USD ($)	May 31, 2022
Debt Instrument [Line Items]
Prepayment of principal			$ 10,000,000	$ 0
Borrowings-non-current portion, net of discounts and debt issuance costs			19,231,000	$ 28,778,000
Amended Loan Agreement \| Innovatus Life Sciences Lending Fund \| Loan payable
Debt Instrument [Line Items]
Term loan borrowings		$ 25,000,000
Remaining borrowing capacity			$ 0
Prepayment of principal	$ 10,000,000
Term loan, interest rate	2.00%
Term loan, paid in-kind, interest rate	1.50%
Term loan, effective interest rate			11.00%	8.50%
Number of monthly installments \| installment			10
Term loan, fee incurred upon payment of final installment			$ 1,000,000
Term loan, prepayment premium percentage			1.00%
Term loan, covenant, revenue performance period			12 months
Debt instrument, minimum cash balance			50.00%
Term loan, covenant, number of days to cure covenant if performance measure is not met			30 days
Term loan covenant, minimum unrestricted cash balance			$ 2,000,000
Amended Loan Agreement \| Innovatus Life Sciences Lending Fund \| Loan payable \| Prime Rate
Debt Instrument [Line Items]
Variable rate	8.00%
Amended Loan Agreement \| Innovatus Life Sciences Lending Fund \| Paid in-kind note
Debt Instrument [Line Items]
Term loan, paid in-kind loans issued			400,000	$ 600,000
Borrowings-non-current portion, net of discounts and debt issuance costs			$ 18,200,000
2017 Term loan \| Innovatus Life Sciences Lending Fund \| Loan payable
Debt Instrument [Line Items]
Term loan covenant, increase to interest rate			4.00%
Equipment Notes Payable
Debt Instrument [Line Items]
Term loan, effective interest rate					5.28%
Notes payable			$ 800,000	800,000
Notes payable current			300,000	200,000
Notes payable noncurrent			$ 500,000	$ 600,000

Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 36,493	$ 62,391
Accounts receivable, net	6,551	6,077
Prepaid expenses and other current assets	4,797	4,143
Total current assets	47,841	72,611
Property and equipment, net	5,201	8,197
Operating lease right-of-use assets	3,286	4,885
Other assets	616	528
Total assets	56,944	86,221
Current liabilities:
Accounts payable	3,131	3,046
Operating lease liabilities	976	1,040
Borrowings-current portion	264	190
Accrued and other current liabilities	7,531	5,347
Total current liabilities	11,902	9,623
Borrowings-non-current portion, net of discounts and debt issuance costs	19,231	28,778
Non-current operating lease liabilities	2,760	4,493
Other non-current liabilities	357	867
Total liabilities	34,250	43,761
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.001 par value per share; 10,000,000 shares authorized, no shares issued or outstanding at December 31, 2023 and December 31, 2022	0	0
Common stock, $0.001 par value per share; 200,000,000 shares authorized at December 31, 2023 and December 31, 2022; 17,045,954 and 16,549,984 shares issued and outstanding at December 31, 2023 and December 31, 2022, respectively	17	17
Additional paid-in capital	301,893	297,970
Accumulated deficit	(279,216)	(255,527)
Total stockholders' equity	22,694	42,460
Total liabilities and stockholders' equity	$ 56,944	$ 86,221

Leases - Supplemental Cash Flow Information On Leases And Weighted-Average Lease Term (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Cash paid for amounts included in the measurement of lease liabilities
Operating cash out flows from operating leases	$ 1,405	$ 1,262
Operating cash out flows from interest paid on finance leases	128	80
Financing cash out flows from finance leases	$ 697	$ 667
Weighted-average remaining lease term (years)
Operating leases	3 years 3 months 18 days	4 years 3 months 18 days
Finance leases	2 years 21 days	1 year 11 months 8 days
Weighted-average discount rate
Operating leases	8.00%	8.00%
Finance leases	12.20%	4.80%

Balance Sheets (Parenthetical) - $ / shares	Dec. 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 issued (in shares)		0
Shares outstanding (in shares)	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)	17,045,954	16,549,984
Shares outstanding (in shares)	17,045,954	16,549,984

Stock Option Plan - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Jan. 01, 2024
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)	5,868,776
Employee options, weighted-average grant date fair value per share (in dollars per share)	$ 2.17	$ 2.74
Intrinsic value of options exercised	$ 200	$ 600
Common stock, fair value per share (in dollars per share)	$ 1.99	$ 2.40
Stock-based compensation expense	$ 3,617	$ 4,704
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)	986,819
Stock options, unrecognized compensation cost	$ 300
Stock options, cost not yet recognized, remaining weighted average vesting period	9 months 18 days
Employee stock purchase plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Annual percentage increase in shares available for issuance under the Plan	1.00%
Common stock reserved for future issuance (in shares)	449,332
Stock options, cost not yet recognized, remaining weighted average vesting period	2 months 12 days
Maximum Employee payroll deduction percentage	20.00%
Issuance of stock under Employee Stock Purchase Plan (in shares)	129,593
Stock-based compensation expense	$ 100	100
Unrecognized compensation cost related to stock purchase	$ 100
Employee stock purchase plan \| Subsequent Event
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Increase (decrease) in number of shares authorized (in shares)			170,460
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)	1,387,459
Grant date fair value of RSUs vested	$ 600	$ 700
Awards granted (in dollars per share)	$ 2.39	$ 5.89
Stock options, unrecognized compensation cost	$ 4,400
Stock options, cost not yet recognized, remaining weighted average vesting period	2 years 9 months 18 days
Common stock, fair value per share (in dollars per share)	$ 4.24	$ 7.28
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
2019 Incentive Award Plan \| Stock options \| Subsequent Event
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Increase (decrease) in number of shares authorized (in shares)			681,838
2019 Incentive Award Plan \| Employee stock purchase plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Annual percentage increase in shares available for issuance under the Plan	4.00%

Leases

12 Months Ended

Dec. 31, 2023

Leases [Abstract]

Leases

Operating Leases

The Company leases office and laboratory space located in Vista, California. The lease expires in April 2027, with an option to extend portions of the lease for additional 5-year periods. The Company has not included the optional renewal periods in the measurement of the lease liability, because it is not reasonably certain that the Company will exercise these renewal options. The Company's payments under the lease are subject to escalation clauses.

The Company leases additional office space in Carlsbad, California, under a sub-lease which commenced in October 2021 and expires in April 2027. Monthly base rent under the sub-lease agreement is $70,042. The monthly base rent increases by approximately 3% annually, each October 1, through the remainder of the lease term.

Finance Leases

The Company has entered into various finance lease agreements to obtain laboratory equipment. The terms of the Company's finance leases generally range from three to five years and are typically secured by the underlying equipment. The portion of the future payments designated as principal repayments were classified as finance lease liabilities on the Company's balance sheet.

Operating and Finance Leases Balances and Costs

Operating and finance leases consist of the following (in thousands):


		December 31,
Lease Balance	Classification	2023		2022
Lease Assets
Operating	Operating lease right-of-use assets	$	3,286	$	4,885
Finance	Property and equipment, net	$	810	$	1,427

Lease Liabilities
Current
Operating	Operating lease liabilities	$	976	$	1,040
Finance	Accrued and other current liabilities	$	490	$	700
Non-current
Operating	Non-current operating lease liabilities	$	2,760	$	4,493
Finance	Other non-current liabilities	$	358	$	848

Costs associated with the Company's leases were included in the statements of operations as follows (in thousands):


	Year Ended December 31,
Lease Cost	2023		2022
Operating leases
Operating lease cost(1)	$	1,463	$	1,540
Finance lease cost
Amortization of lease assets	556		679
Interest on finance lease liabilities	128		80
Total lease cost	$	2,147	$	2,299

(1) Includes variable lease cost of $129,000 and $165,000 for the years ended December 31, 2023 and 2022, respectively.

Supplemental cash flow information on leases is as follows (in thousands):


	Year Ended December 31,
Cash paid for amounts included in the measurement of lease liabilities	2023		2022
Operating cash out flows from operating leases	$	1,405	$	1,262
Operating cash out flows from interest paid on finance leases	$	128	$	80
Financing cash out flows from finance leases	$	697	$	667

Information regarding the weighted-average lease term and weighted average discount rate are as follows:


	Year Ended December 31,
	2023		2022
Weighted-average remaining lease term (years)
Operating leases	3.3		4.3
Finance leases	2.06		1.94
Weighted-average discount rate
Operating leases	8.0	%	8.0	%
Finance leases	12.2	%	4.8	%

Future payments under operating and finance leases as of December 31, 2023 are as follows (in thousands):


	Operating Leases		Finance Leases


2024	$	1,240	$	574
2025	1,277		248
2026	1,315		147
2027	445		28
Total minimum lease payments	4,277		997
Less: imputed interest	(541)		(149)
Total lease liabilities	3,736		848
Less: current portion	(976)		(490)
Lease obligations, net of current portion	$	2,760	$	358

Leases

Operating Leases

Finance Leases

Operating and Finance Leases Balances and Costs

Operating and finance leases consist of the following (in thousands):


		December 31,
Lease Balance	Classification	2023		2022
Lease Assets
Operating	Operating lease right-of-use assets	$	3,286	$	4,885
Finance	Property and equipment, net	$	810	$	1,427

Lease Liabilities
Current
Operating	Operating lease liabilities	$	976	$	1,040
Finance	Accrued and other current liabilities	$	490	$	700
Non-current
Operating	Non-current operating lease liabilities	$	2,760	$	4,493
Finance	Other non-current liabilities	$	358	$	848

Costs associated with the Company's leases were included in the statements of operations as follows (in thousands):


	Year Ended December 31,
Lease Cost	2023		2022
Operating leases
Operating lease cost(1)	$	1,463	$	1,540
Finance lease cost
Amortization of lease assets	556		679
Interest on finance lease liabilities	128		80
Total lease cost	$	2,147	$	2,299

(1) Includes variable lease cost of $129,000 and $165,000 for the years ended December 31, 2023 and 2022, respectively.

Supplemental cash flow information on leases is as follows (in thousands):


	Year Ended December 31,
Cash paid for amounts included in the measurement of lease liabilities	2023		2022
Operating cash out flows from operating leases	$	1,405	$	1,262
Operating cash out flows from interest paid on finance leases	$	128	$	80
Financing cash out flows from finance leases	$	697	$	667

Information regarding the weighted-average lease term and weighted average discount rate are as follows:


	Year Ended December 31,
	2023		2022
Weighted-average remaining lease term (years)
Operating leases	3.3		4.3
Finance leases	2.06		1.94
Weighted-average discount rate
Operating leases	8.0	%	8.0	%
Finance leases	12.2	%	4.8	%

Future payments under operating and finance leases as of December 31, 2023 are as follows (in thousands):


	Operating Leases		Finance Leases


2024	$	1,240	$	574
2025	1,277		248
2026	1,315		147
2027	445		28
Total minimum lease payments	4,277		997
Less: imputed interest	(541)		(149)
Total lease liabilities	3,736		848
Less: current portion	(976)		(490)
Lease obligations, net of current portion	$	2,760	$	358

Stock Option Plan - Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Number of Options
Outstanding, beginning balance (in shares)	1,421,235
Granted (in shares)	73,500
Exercised (in shares)	(93,335)
Forfeited (in shares)	(43,895)
Expired (in shares)	(370,686)
Outstanding, ending balance (in shares)	986,819	1,421,235
Vested and expected to vest (in shares)	986,819
Options exercisable (in Shares)	877,937
Weighted- Average Exercise Price
Outstanding, beginning balance (in dollars per share)	$ 12.94
Granted (in dollars per share)	3.04
Exercised (in dollars per share)	0.26
Forfeited (in dollars per share)	13.83
Expired (in dollars per share)	16.88
Outstanding, ending balance (in dollars per share)	11.87	$ 12.94
Vested and expected to vest (in dollars per share)	11.87
Options exercisable (in dollars per share)	$ 12.46
Weighted-Average Remaining Contractual Term (Years) and Aggregate Instrinsic Value
Outstanding, Weighted Average Remaining Contractual Term	6 years 5 months 8 days	7 years 1 month 2 days
Vested and expected to vest, Weighted Average Remaining Contractual Term	6 years 5 months 8 days
Options exercisable, Weighted Average Remaining Contractual Term	6 years 2 months 4 days
Outstanding, Aggregate Intrinsic Value	$ 228	$ 483
Vested and expected to vest, Aggregate Intrinsic Value	228
Options exercisable, Aggregate Intrinsic Value	$ 228

Stock Option Plan

12 Months Ended

Dec. 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, RSUs 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 Company's 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 Company's board of directors. As of December 31, 2023, 1,831,107 shares of common stock remained available for future awards.

Pursuant to the evergreen provision, on January 1, 2024, an additional 681,838 shares of common stock became available for issuance under the 2019 Plan.

Restricted Stock Units

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


	Number of Shares	Weighted- Average Grant Date Fair Value		Aggregate Intrinsic Value
Outstanding, December 31, 2022	1,036,208	$	7.28	$	2,487
Awards granted	857,300	$	2.39
Awards released	(273,319)	$	7.80
Awards canceled	(232,730)	$	6.80
Outstanding, December 31, 2023	1,387,459	$	4.24	$	2,761

As of December 31, 2023, all of the outstanding RSUs are unvested. The fair value of RSUs vested in the years ended December 31, 2023 and 2022 was $0.6 million and $0.7 million, respectively. The weighted average grant date fair value for RSUs granted during the years ended December 31, 2023 and 2022 was $2.39 and $5.89, respectively. As of December 31, 2023, total unrecognized compensation cost related to RSUs was $4.4 million, which is expected to be recognized over a remaining weighted-average vesting period of 2.8 years.

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
Outstanding, December 31, 2022	1,421,235	$	12.94	7.09	$	483
Granted	73,500	$	3.04
Exercised	(93,335)	$	0.26
Forfeited	(43,895)	$	13.83
Expired	(370,686)	$	16.88
Outstanding, December 31, 2023	986,819	$	11.87	6.44	$	228
Vested and expected to vest, December 31, 2023	986,819	$	11.87	6.44	$	228
Options exercisable, December 31, 2023	877,937	$	12.46	6.18	$	228

The weighted-average grant date fair value per share of options granted during the years ended December 31, 2023 and 2022 was $2.17 and $2.74, respectively. The aggregate intrinsic value of options exercised during the years ended December 31, 2023 and 2022 was $0.2 million and $0.6 million, respectively. 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 fair value of the Company's common stock was $1.99 and $2.40 per share at December 31, 2023 and 2022, respectively. As of December 31, 2023, total unrecognized compensation cost related to option awards was $0.3 million, which is expected to be recognized over a remaining weighted-average vesting period of 0.8 years.

2019 Employee Stock Purchase Plan

In September 2019, the Company's 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 Company's board of directors. During the year ended December 31, 2023, the Company issued 129,593 shares of common stock pursuant to scheduled purchases under the ESPP. As of December 31, 2023, 449,332 shares of common stock remained available for issuance. Pursuant to the evergreen provision, on January 1, 2024, an additional 170,460 shares became available for issuance under the ESPP.

Stock-based compensation expense related to the ESPP for each of the years ended December 31, 2023 and 2022 was less than $0.1 million. As of December 31, 2023, total unrecognized compensation cost related to stock purchase rights granted under the ESPP was less than $0.1 million, which is expected to be recognized over a remaining weighted-average vesting period of 0.2 years.

Stock-Based Compensation Expense

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


	Year Ended December 31,
	2023		2022
Cost of revenue	$	191	$	213
Selling, general and administrative	3,174		3,860
Research and development	252		631
Total	$	3,617	$	4,704

Common stock reserved for future issuance consists of the following at December 31, 2023:


Warrants to purchase common stock						1,214,059
Common stock option grants issued and outstanding						986,819
Common stock reserved for issuance upon vesting of outstanding restricted stock units						1,387,459
Common shares available for grant under the 2019 Plan						1,831,107
Common shares available for future issuance under ESPP						449,332
Total						5,868,776

Income Taxes - Reconciliation of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Deferred tax assets:
Net operating loss carryforwards	$ 32,479	$ 29,789
Research and development tax credits	2,353	2,216
Accruals, reserves and other	1,119	349
Interest expense	2,547	2,236
Indefinite lived assets	300	362
Stock compensation	1,391	1,606
Lease liability	925	1,374
Capitalization of research and experimentation costs	2,929	2,047
Total gross deferred tax assets	44,043	39,979
Less: valuation allowance	(42,942)	(38,567)	$ (27,158)
Deferred tax assets, net	1,101	1,412
Deferred tax liabilities:
Right of use assets	(814)	(1,206)
Basis differences in fixed and intangible assets	(287)	(206)
Deferred tax liabilities	(1,101)	(1,412)
Net deferred tax assets	$ 0	$ 0

Stock Option Plan (Tables)

12 Months Ended

Dec. 31, 2023

Share-Based Payment Arrangement [Abstract]

Schedule of Share-based Payment Arrangement, Restricted Stock Unit, Activity

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


	Number of Shares	Weighted- Average Grant Date Fair Value		Aggregate Intrinsic Value
Outstanding, December 31, 2022	1,036,208	$	7.28	$	2,487
Awards granted	857,300	$	2.39
Awards released	(273,319)	$	7.80
Awards canceled	(232,730)	$	6.80
Outstanding, December 31, 2023	1,387,459	$	4.24	$	2,761

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
Outstanding, December 31, 2022	1,421,235	$	12.94	7.09	$	483
Granted	73,500	$	3.04
Exercised	(93,335)	$	0.26
Forfeited	(43,895)	$	13.83
Expired	(370,686)	$	16.88
Outstanding, December 31, 2023	986,819	$	11.87	6.44	$	228
Vested and expected to vest, December 31, 2023	986,819	$	11.87	6.44	$	228
Options exercisable, December 31, 2023	877,937	$	12.46	6.18	$	228

Schedule of Non-cash Stock-based Compensation Expense

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


	Year Ended December 31,
	2023		2022
Cost of revenue	$	191	$	213
Selling, general and administrative	3,174		3,860
Research and development	252		631
Total	$	3,617	$	4,704

Schedule of Common Stock Reserved For Future Issuance

Common stock reserved for future issuance consists of the following at December 31, 2023:


Warrants to purchase common stock						1,214,059
Common stock option grants issued and outstanding						986,819
Common stock reserved for issuance upon vesting of outstanding restricted stock units						1,387,459
Common shares available for grant under the 2019 Plan						1,831,107
Common shares available for future issuance under ESPP						449,332
Total						5,868,776

Other Financial Information - Goodwill (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Goodwill [Roll Forward]
Beginning balance	$ 0	$ 5,506
Goodwill impairment	$ 0	(5,506)
Ending balance		$ 0

- Definition

Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized.

+ References + Details

Commitment and Contingencies	12 Months Ended
Commitment and Contingencies	Dec. 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 had royalty payment obligations of 2.5% on net sales of products which incorporate certain acquired technologies through December 31, 2023. These obligations no longer exist for products sold after December 31, 2023. 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 incurred and recorded in costs of revenue in the accompanying statements of operations. Supply Agreements In December 2021, the Company amended a supply agreement with one supplier for reagents which includes minimum annual purchase commitments of $8.0 million and $9.2 million for the years ended December 31, 2024 and 2025, respectively. 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 per year. Collaboration expenses under the master research collaboration agreement were $0.3 million for each of the years ended December 31, 2023 and 2022. Collaboration expenses under the AHN collaboration are included in research and development expenses in the accompanying statements of operations. 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 as of December 31, 2023 will have a material effect on its financial position or results of operations. In October 2023, the Company resolved an investigation with the U.S. Attorney’s Office for the District of Massachusetts that was initiated by a qui tam lawsuit. Pursuant to a Settlement Agreement, the Company made a single lump-sum remittance to the government in the amount of $0.7 million in connection with specimen processing arrangements that Exagen historically had with physicians. The U.S. Attorney’s Office dismissed this “covered conduct” in the qui tam lawsuit with prejudice, while non-covered conduct was dismissed without prejudice. In November 2023 the complaint was unsealed and served on Exagen. Exagen filed a motion to dismiss the complaint. In December 2023, the Company's insurance carrier provided reimbursement for certain defense costs the Company incurred in the October 2023 qui tam lawsuit. In February 2024, the relator filed a motion for leave to amend the complaint. Exagen opposed this motion, and all motions are still pending. The Company intends to vigorously defend against the claims being asserted in the complaint. The Company's participation in federal healthcare programs is not affected by the Settlement Agreement.

Fair Value Measurements

12 Months Ended

Dec. 31, 2023

Fair Value Disclosures [Abstract]

Fair Value Measurements

The carrying values 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 and are considered to be Level 1 measurements. 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 December 31, 2023, the Amended Loan Agreement had a carrying value of $18.7 million and a fair value of $19.7 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 Amended Loan Agreement 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 carrying value of the Company's other long-term borrowing as of December 31, 2023 was $0.8 million, which approximated its fair value.

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):


	December 31, 2023
	Total		Level 1		Level 2		Level 3
Assets:
Money market funds, included in cash and cash equivalents	$	14,386	$	14,386	$	—	$	—


	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

Borrowings (Tables)

12 Months Ended

Dec. 31, 2023

Debt Disclosure [Abstract]

Schedule of Future Minimum Aggregate Payments for Outstanding Borrowings

As of December 31, 2023, future minimum aggregate payments, including interest, for outstanding borrowings are as follows (in thousands):


	Years Ending December 31,




2024	1,949
2025	1,974
2026	21,243


Total	25,166
Less:
Unamortized debt discount and issuance costs	(113)
Interest	(5,558)
Total borrowings, net of discounts and debt issuance costs	19,495
Less: Borrowings-current portion	(264)
Borrowings-non-current portion, net of discounts and debt issuance costs	$	19,231

Stockholders' Equity - Warrants to Purchase Common Stock Outstanding (Details)	Dec. 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

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

+ Details

Stockholders' Equity (Tables)

12 Months Ended

Dec. 31, 2023

Equity [Abstract]

Schedule of Outstanding Warrants

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

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 (Exchange Warrants)

804,951

0.001

June 22, 2021

None

1,214,059

Leases - Narrative (Details) - USD ($)	1 Months Ended
Leases - Narrative (Details) - USD ($)	Oct. 31, 2021	Dec. 31, 2023
Office and Laboratory
Loss Contingencies [Line Items]
Operating lease, renewal term		5 years
Office
Loss Contingencies [Line Items]
Operating lease, monthly base rent	$ 70,042
Operating lease, annual increase in base rent payment percentage	3.00%
Minimum
Loss Contingencies [Line Items]
Finance lease, term of contract		3 years
Maximum
Loss Contingencies [Line Items]
Finance lease, term of contract		5 years

Other Financial Information - Property and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 10,970	$ 13,321
Less: accumulated depreciation and amortization	(5,769)	(5,124)
Property and equipment, net	5,201	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	5,312	5,136
Computer equipment and software
Property, Plant and Equipment [Line Items]
Total property and equipment	2,185	1,482
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total property and equipment	3,316	5,223
Construction in progress
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 59	$ 1,382

Other Financial Information - Accrued Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Other Financial Information [Abstract]
Accrued payroll and related expenses	$ 4,738	$ 2,355
Accrued interest	139	142
Accrued purchases of goods and services	720	803
Accrued royalties	463	514
Accrued clinical study activity	$ 118	$ 162
Finance lease, liability, current, statement of financial position	Accrued and other current liabilities	Accrued and other current liabilities
Finance lease obligations, current portion	$ 490	$ 700
Refund liability	302	445
Other accrued liabilities	561	226
Accrued and other current liabilities	$ 7,531	$ 5,347

Stockholders' Equity

12 Months Ended

Dec. 31, 2023

Equity [Abstract]

Stockholders' Equity

Common Stock

Shelf Registration Statement

On November 17, 2023, the Company filed a registration statement on Form S-3, as amended (the 2023 Shelf Registration Statement), covering the offering, from time to time, of up to $150.0 million of common stock, preferred stock, debt securities, warrants and units. The 2023 Shelf Registration Statement became effective on November 29, 2023, and all $150.0 million remain available for sale as of December 31, 2023.

At The Market Sales Agreement

On September 15, 2022, the Company entered into a sales agreement, as amended on November 17, 2023 (the Sales Agreement) with Cowen and Company, LLC as 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 December 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 December 31, 2023:

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 (Exchange Warrants)

804,951

0.001

June 22, 2021

None

1,214,059

No warrants to purchase common stock were exercised during the years ended December 31, 2023 and 2022.

- Definition

The entire disclosure for equity.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 13
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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+ Details