Document


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM SD
SPECIALIZED DISCLOSURE REPORT
 
NantHealth, Inc.
(Exact name of registrant as specified in its charter)
 
Delaware
001-37792
27-3019889
(State or other jurisdiction
of incorporation
(Commission
File Number)
(I.R.S. Employer
Identification No.)
9920 Jefferson Blvd
Culver City, California 90232
(Address of principal executive offices) (Zip Code)
 
 
Ron Louks
Chief Operating Officer
(310) 883-1300
 
(Name and telephone number, including area code, of the person to contact in connection with this report)
Check the appropriate box to indicate the rule pursuant to which this form is being filed, and provide the period to which the information in this form applies:
x Rule 13p-1 under the Securities Exchange Act (17 CFR 240.13p-1) for the reporting period from January 1 to December 31, 2018.
 

Section 1 - Conflict Minerals Disclosure
Item 1.01 Conflict Minerals Disclosure and Report
Conflict Minerals Disclosure
For the reporting period from January 1, 2018 to December 31, 2018, NantHealth, Inc. determined that certain “conflict minerals,” as defined in Section 1, Item 1.01(d)(3) of Form SD, are necessary to the functionality or production of the HBox product that we contract with third-parties to manufacture. Accordingly, we conducted a reasonable country of origin inquiry to determine whether during 2018 our products contained conflict minerals that originated in the Democratic Republic of the Congo or certain adjoining countries, which we refer to collectively as the “covered countries.” We then conducted due diligence designed to conform to the Organisation for Economic Co-operation and Development Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas in order to determine whether any of the conflict minerals used in our products during 2018 originated from any of the covered countries and whether these conflict minerals benefited, directly or indirectly, armed groups in any of the covered countries.
In accordance with Rule 13p-1 promulgated under the Securities Exchange Act of 1934, as amended, and this Specialized Disclosure Report on Form SD, we have filed a Conflict Minerals Report, which is attached as Exhibit 1.01 hereto. A copy of this Form SD and the Conflict Minerals Report are publicly available at http://ir.nanthealth.com/financial-information/sec-filings and http://ir.nanthealth.com/corporate-governance/highlights, respectively.





Item 1.02 Exhibit
In accordance with Rule 13p-1, and this Form SD, we have filed our Conflict Minerals Report, which is attached as Exhibit 1.01 to this Form SD.

Section 2 - Exhibits
Item 2.01 Exhibits
The following exhibit is filed as part of this Form SD.

Exhibit
No.
Description

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the duly authorized undersigned.

NantHealth, Inc.

(Registrant)
Date: May 31, 2019
By:
/s/ Ron Louks
 
 
Ron Louks
 
 
Chief Operating Officer and Director


Exhibit


Exhibit 1.01
NantHealth, Inc.
Conflict Minerals Report
For The Year Ended December 31, 2018
Cautionary Note Concerning Forward-Looking Statements: This Conflict Minerals Report contains forward-looking statements within the meaning of federal securities laws. These forward-looking statements include statements concerning NantHealth’s objectives for its conflict minerals policy and compliance initiatives and actions it intends to take relating to conflict minerals. Forward-looking statements involve substantial risks and uncertainties that could cause actual results to differ materially from currently anticipated results. When considering forward-looking statements, you should consider, among other factors, the risk factors described in the reports and other filings that NantHealth files with the United States Securities and Exchange Commission, including NantHealth’s Annual Report on Form 10-K for the year ended December 31, 2018 and its subsequent Quarterly Reports on Form 10-Q. The risk factors included in these filings are not exhaustive, and risks that are not identified therein could materially affect whether NantHealth realizes the results anticipated or implied by any forward-looking statements contained in this Conflict Minerals Report. Except as required by law, NantHealth disclaims any obligation to update these forward-looking statements, whether as a result of new information, future events, or otherwise.
Introduction
This Conflict Minerals Report (this “Report”) for NantHealth, Inc. (“NantHealth” or “we” or “our”) covers the reporting period from January 1, 2018 to December 31, 2018 and is presented in accordance with Rule 13p-1 promulgated under the Securities Exchange Act of 1934, as amended (“Rule 13p-1”). This Report is filed as Exhibit 1.01 to our Specialized Disclosure Report on Form SD (the “Form SD”). A copy of this Report and the Form SD are publicly available on our website at http://ir.nanthealth.com/financial-information/sec-filings.
In 2010, the United States enacted the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Act”). Section 1502 of the Act relates to conflict minerals and requires companies subject to the Act to file a Form SD annually with the United States Securities and Exchange Commission (“SEC”) to disclose whether the tungsten, tantalum, tin, and gold (referred to collectively as “3TG”) used in their products benefited, directly or indirectly, armed groups in the Democratic Republic of the Congo and adjoining countries (collectively, the “Covered Countries”). This Report, which is an exhibit to our Form SD, describes the design and implementation of our conflict minerals due diligence measures undertaken in 2018, including a description of how these measures were designed to determine, to our knowledge, the source mines, countries of origin, and processing facilities for 3TG contained in components used in NantHealth’s products.
Background and Covered Products
NantHealth, together with its subsidiaries, is a healthcare IT company converging science and technology. The Company works to transform clinical delivery with actionable clinical intelligence at the moment of decision, enabling clinical discovery through real-time machine learning systems. The Company markets certain of its solutions as a comprehensive integrated solution that includes its molecular sequencing and analysis services, clinical decision support, and payer engagement solutions. The Company also markets molecular sequencing and analysis services, clinical decision support, payer engagement and connected care solutions. We do not manufacture our products but contract with third parties for their manufacture. Our supply chain is complex, and multiple tiers exist between the mines from which 3TG are extracted and its incorporation into our products. We do not purchase raw ore or unrefined 3TG directly and make no purchases in the Covered Countries. As a result and as described more fully below, we rely on our suppliers to provide information on the origin of the 3TG contained in our products.
NantHealth Covered Products
Based upon the Company’s assessment, the Company has determined that its HBox has the potential to contain 3TG as it contains printed circuit assemblies and other electromechanical components that are generally known to contain small amounts of tin, tungsten, tantalum or gold. HBox is manufactured according to NantHealth specifications by contract manufacturers over whom the Company has influence and, thus, falls within the scope of Rule 13p-1 as a product manufactured by NantHealth.





Reasonable Country of Origin Inquiry
In accordance with Rule 13p-1 and Form SD, NantHealth determined that 3TG are necessary to the functionality or production of HBox and that 3TG are incorporated into HBox during the manufacturing process. Accordingly, we undertook a reasonable country of origin inquiry (“RCOI”).
NantHealth’s RCOI consisted principally of submitting to its suppliers the conflict minerals reporting template (the “RMI Template”) prepared by the Responsible Minerals Initiative (“RMI”), an initiative of the Responsible Business Alliance and Global e-Sustainability Initiative. NantHealth submitted the RMI Template to all of its contract manufacturers. NantHealth then reviewed all responses for completeness, reasonableness, and consistency, and followed up for corrections and clarifications as NantHealth determined appropriate.
Based on NantHealth’s RCOI, NantHealth was unable to determine that the 3TG used in its products did not originate in Covered Countries.
Due Diligence Process

Management Systems
The Company has adopted a Conflict Minerals Policy, which can be found on the Company’s website at http://ir.nanthealth.com/corporate-governance/highlights. In the negotiation of future contracts, consistent with the Company’s Conflict Minerals Policy, the Company intends to include provisions to encourage conflict-free sourcing. Given the limited number of suppliers whose products contain Conflict Minerals, other systems, such as codes of conduct, training programs or grievance mechanisms, have been deemed to be unnecessary.

Identification and Assessment of Risks

The Company has established a product oriented approach to evaluating due diligence, enabling the identification of large classes of products which have no risk of containing 3TG, and thus are not subject to due diligence. Due to the small number of remaining products (HBox), the Company has been able to readily assess the risk of each through the RCOI process described above and conclude that these products and manufacturers require further due diligence.


Response to Identified Risks

The Company is in direct dialogue with the contract manufacturers of HBox, and it intends to build upon this dialogue in the future. These manufacturers are reliant upon information provided to them by their suppliers. The Company intends to continue to pursue information regarding 3TG in the supply chain for HBox. If a contract manufacturer does not cooperate with the Company’s due diligence efforts, it will be reported to the Chief Operating Officer and potential actions will be considered. If a supplier is identified that is not free of conflict minerals, such findings will be reported to the Chief Operating Officer and, at a minimum, the Company intends to encourage the contract manufacturer to identify an alternative supplier of the related component.

Independent Audit of Smelter Due Diligence Practices

As contract manufacturers are able to trace supplier 3TG to the specific smelters from which they were sourced, the contract manufacturers and the Company reference the RMI’S Responsible Minerals Assurance Program (“RMAP”) as a source of independent audit information about these specific smelters.

Annual Reporting

In compliance with the Rule 13p-1, NantHealth intends to report to the SEC annually regarding supply chain due diligence on Form SD and provide a Conflict Minerals Report to the extent it is required.
Smelters and Refiners in Supply Chain
We adopted RMI’s industry approach to trace back the origin of 3TG by identifying smelters, refineries, or recyclers and scrap supplier sources through our supply chain survey results. NantHealth leveraged RMI and the RMAP to trace the mine of origin of the 3TG to its ore level. The RMAP audits smelters and refineries to ensure that all certified smelters and refineries use only the ores that are conflict free from the Covered Countries. Based on information that was provided by





our manufacturers or that was otherwise obtained through our due diligence process, we believe, to the extent reasonably determinable, that the following facilities were used to process 3TG contained in our covered products.
We have also provided information concerning (i) whether the smelter participates in the RMAP and has been audited or whether it has agreed to participate in the RMAP but the audit process has not yet been completed, (ii) whether the gold refiner is a London Bullion Market Association accredited refiner on the Good Delivery List, and (iii) whether the gold refiner is a Responsible Jewellery Council Certified Member.

Metal
Smelter or Refiner Name
Country
RMAP*
Gold
Tanaka Kikinzoku Kogyo K.K.
JAPAN
C**
Gold
Shandong Zhaojin Gold & Silver Refinery Co., Ltd.
CHINA
C**
Gold
Heraeus Metals Hong Kong Ltd.
CHINA
C**#
Gold
Solar Applied Materials Technology Corp.
TAIWAN
C**
Gold
Metalor Technologies (Hong Kong) Ltd.
CHINA
C**#
Gold
PAMP S.A.
SWITZERLAND
C**
Gold
Valcambi S.A.
SWITZERLAND
C**#
Gold
Argor-Heraeus S.A.
SWITZERLAND
C**#
Gold
Western Australian Mint trading as The Perth Mint
AUSTRALIA
C**
Gold
Eco-System Recycling Co., Ltd.
JAPAN
C
Gold
Heimerle + Meule GmbH
GERMANY
C**
Gold
Allgemeine Gold-und Silberscheideanstalt A.G.
GERMANY
C**#
Gold
AngloGold Ashanti Córrego do Sítio Mineração
BRAZIL
C**
Gold
Asahi Pretec Corporation
JAPAN
C**
Gold
Asahi Refining Canada Ltd.
CANADA
C**
Gold
Asahi Refining USA Inc.
UNITED STATES
C**
Gold
Aurubis AG
GERMANY
C**
Gold
Chimet S.p.A.
ITALY
C**
Gold
Dowa
JAPAN
C
Gold
Heraeus Precious Metals GmbH & Co. KG
GERMANY
C**
Gold
Ishifuku Metal Industry Co., Ltd.
JAPAN
C**
Gold
JX Nippon Mining & Metals Co., Ltd.
JAPAN
C**
Gold
Kennecott Utah Copper LLC
UNITED STATES
C**
Gold
Kojima Chemicals Co., Ltd.
JAPAN
C
Gold
LS-NIKKO Copper Inc.
KOREA, REPUBLIC OF
C**
Gold
Matsuda Sangyo Co., Ltd.
JAPAN
C**
Gold
Metalor USA Refining Corporation
UNITED STATES
C**#
Gold
Mitsui Mining and Smelting Co., Ltd.
JAPAN
C**
Gold
Royal Canadian Mint
CANADA
C**
Gold
SEMPSA Joyería Platería S.A.
SPAIN
C**#
Gold
Sumitomo Metal Mining Co., Ltd.
JAPAN
C**
Gold
Tokuriki Honten Co., Ltd.
JAPAN
C**
Gold
Umicore S.A. Business Unit Precious Metals Refining
BELGIUM
C**
Gold
United Precious Metal Refining, Inc.
UNITED STATES
C
Gold
Zhongyuan Gold Smelter of Zhongjin Gold Corporation
CHINA
C**
Gold
The Refinery of Shandong Gold Mining Co., Ltd.
CHINA
C**
Gold
Metalor Technologies (Singapore) Pte., Ltd.
SINGAPORE
C**#
Gold
Metalor Technologies (Suzhou) Ltd.
CHINA
C#
Gold
Boliden AB
SWEDEN
C**
Gold
C. Hahner GmbH + Co. KG
GERMANY
C**#
Gold
Istanbul Gold Refinery
TURKEY
C**
Gold
Yamakin Co., Ltd.
JAPAN
C





Tin
PT Timah Tbk Kundur
INDONESIA
C
Tin
CV United Smelting
INDONESIA
C
Tin
Mitsubishi Materials Corporation
JAPAN
C
Tin
PT Bukit Timah
INDONESIA
C
Tin
PT Timah Tbk Mentok
INDONESIA
C
Tin
Mineração Taboca S.A.
BRAZIL
C
Tin
Minsur
PERU
C
Tin
Malaysia Smelting Corporation (MSC)
MALAYSIA
A
Tin
Fenix Metals
POLAND
C
Tin
Operaciones Metalurgicas S.A.
BOLIVIA
C
Tin
PT Stanindo Inti Perkasa
INDONESIA
C
Tin
Gejiu Non-Ferrous Metal Processing Co., Ltd.
CHINA
C
Tin
PT Tinindo Inter Nusa
INDONESIA
C
Tin
PT Aries Kencana Sejahtera
INDONESIA
C
Tin
PT Babel Inti Perkasa
INDONESIA
C
Tin
PT Bangka Tin Industry
INDONESIA
C
Tin
PT DS Jaya Abadi
INDONESIA
C
Tin
PT Inti Stania Prima
INDONESIA
C
Tin
PT Panca Mega Persada
INDONESIA
C
Tin
PT Refined Bangka Tin
INDONESIA
C
Tin
PT Sariwiguna Binasentosa
INDONESIA
A
Tin
Rui Da Hung
TAIWAN
C
Tin
White Solder Metalurgia e Mineração Ltda.
BRAZIL
C
Tin
Metallic Resources, Inc.
UNITED STATES
C
Tin
PT ATD Makmur Mandiri Jaya
INDONESIA
C
Tin
PT Mitra Stania Prima
INDONESIA
A
Tungsten
Global Tungsten & Powders Corp.
UNITED STATES
A
Tungsten
Ganzhou Seadragon W & Mo Co., Ltd.
CHINA
C
Tungsten
Hunan Chunchang Nonferrous Metals Co., Ltd.
CHINA
C
Tungsten
Guangdong Xianglu Tungsten Co., Ltd.
CHINA
C
Tungsten
Japan New Metals Co., Ltd.
JAPAN
C
Tungsten
Wolfram Bergbau und Hütten AG
AUSTRIA
A
Tungsten
Chenzhou Diamond Tungsten Products Co., Ltd.
CHINA
A
Tungsten
Jiangxi Gan Bei Tungsten Co., Ltd.
CHINA
C
Tungsten
Fujian Jinxin Tungsten Co., Ltd.
CHINA
A
Tungsten
H.C. Starck Smelting GmbH & Co. KG
GERMANY
C
Tungsten
Hunan Chuangda Vanadium Tungsten Co., Ltd. Wuji
CHINA
A
Tungsten
Jiangwu H.C. Starck Tungsten Products Co., Ltd.
CHINA
A
Tungsten
Jiangxi Tonggu Non-ferrous Metallurgical & Chemical Co., Ltd.
CHINA
A
Tungsten
Jiangxi Yaosheng Tungsten Co., Ltd.
CHINA
A
Tungsten
Malipo Haiyu Tungsten Co., Ltd.
CHINA
C
Tungsten
Niagara Refining LLC
UNITED STATES
A
Tungsten
Masan Tungsten Chemical LLC (MTC)
VIETNAM
A
Tungsten
Xinhai Rendan Shaoguan Tungsten Co., Ltd.
CHINA
A

*
This column indicates whether the known smelter or refiner participates in the RMAP as a smelter that sources conflict minerals in a manner that does not finance or benefit armed groups in the Covered Countries. For purposes of this column, “C” denotes that the smelter participates in the RMAP and has been certified and audited by the RMI, “A” denotes that the smelter has agreed to participate in the RMAP but that the audit process has not yet been completed as of May 13, 2019, and “U” denotes that the smelter or refinery has not received a “conflict free”





designation from an independent third party audit program or the facility’s receipt of such designation is undeterminable.
**
Denotes a London Bullion Market Association accredited gold refiner on the Good Delivery List as of May 13, 2019.
#
Denotes a Responsible Jewellery Council Certified Member as of May 13, 2019.