|
|
|
Delaware
|
|
001-37792
|
|
27-3019889
|
(State or other jurisdiction of incorporation)
|
|
(Commission File Number)
|
|
(IRS Employer
Identification No.)
|
|
Item 2.02
|
Results of Operations and Financial Condition.
|
Item 9.01
|
Financial Statements and Exhibits
.
|
Exhibit No.
|
Description
|
99.1
|
|
|
|
|
NantHealth, Inc.
|
|
|
|
|
|
Date:
|
August 8, 2019
|
By:
|
|
/s/ Bob Petrou
|
|
|
|
|
Bob Petrou
|
|
|
|
|
Chief Financial Officer
|
|
Investor Contact:
Robert Jaffe
rjaffe@rjaffeco.com
424.288.4098
|
|
•
|
Q2 Financial Highlights:
|
◦
|
Fourth consecutive quarter of total revenue growth
|
◦
|
Total revenue was $25.7 million, up 17% from Q2 2018
|
◦
|
SaaS revenue of $18.3 million, rose 13% from Q2 2018 and 3% sequentially
|
◦
|
Gross profit was $15.9 million, compared with $11.5 million in Q2 2018
|
◦
|
Gross margin increased to 62% from 52% in Q2 2018
|
•
|
Software and Service business continued positive momentum in 1H 2019
|
•
|
Clinical Decision Support (Eviti):
|
◦
|
In Q2, at America’s Health Insurance Plans (AHIP) Institute & Expo 2019, showcased
Eviti
®
Connect
, the company’s
evidence-based treatment intelligence and web-based oncology decision support platform
|
◦
|
In Q2, as previously announced, signed and launched a three-year partnership with CareSource, a leading nonprofit multi-state health plan, expanding Eviti Connect’s total covered lives to over 25 million
|
◦
|
In Q2, released v7.8 with Smart Regimen Search, an enhancement that expedites treatment plan entry via intelligent regimen driven drug matches
|
•
|
Payer Engagement (NaviNet):
|
◦
|
In Q2, at America’s Health Insurance Plans (AHIP) Institute & Expo 2019, showcased
NaviNet® Open
, the company’s
secure, multi-payer platform that lets payers and providers exchange vital administrative and clinical information
|
◦
|
In Q2, released a number of enhancements to the NaviNet Open Authorization application, which enable the company’s health plans to offer more configuration options. These include reducing the need for manual intervention via phone and fax processes and saving providers time managing their authorization requests, speeding up delivery of care
|
◦
|
In Q2, launched the NaviNet API Gateway, which allows the company’s partners to interact directly with its API’s in a standard method, reducing the reliance on custom integration methods and enabling payer flexibility for their provider networks
|
•
|
Connected Care (DeviceConX):
|
◦
|
In Q2, at the 2019 HIMSS and Health 2.0 European Conference, participated in the first-ever U.S. Pavilion where the company showcased
DeviceConX
™,
HBox
®
and
VitalsConX
to Europe’s eHealth decision makers
|
◦
|
In May, at Vitalis, the largest e-health event in Scandinavia, presented the company’s latest connected care solutions and sponsored the Intelligent Hospital Pavilion (IHP), where the company demonstrated its latest
DeviceConX
5.15 medical device integration solution
|
◦
|
In August, entered into a memorandum of understanding with ASCOM to provide the company’s Denmark client increased visibility of their device parameters. The combined capabilities provide clinicians with increased visibility of intelligent alert notifications, driving more informed decisions at the point of care, closing digital information gaps and allowing for the best possible decisions throughout the hospital ecosystem
|
◦
|
In Q2, total GPS orders were 136, comprised of 86 GPS Cancer and 50 Liquid GPS
|
◦
|
In Q2, at the American Society of Clinical Oncology’s (ASCO) 2019 Annual Meeting, scientific teams from NantHealth and NantOmics presented:
|
▪
|
With collaborators from Virginia Commonwealth University (VCU), “
Tumor mutation burden and PD-L1 expression in SDH/FH mutated solid tumors,” which
support, for the first time, a potential therapeutic role for inhibition of PD-1/PD-L1 pathway in these tumors
|
▪
|
With collaborators from the University of California, San Diego (UCSD), “Evidence for selective silencing of MHC-binding neoepitopes to avoid immune surveillance,” which can inform the development of effective immunotherapy and cancer vaccine strategies
|
◦
|
In Q2, at the American Association for Cancer Research (AACR) 2019 Annual Meeting,
scientific teams from NantHealth and NantOmics presented:
|
▪
|
With collaborators from Duke University and the Sarcoma Center of Southern California, “
Enhanced expression of human cyclin G1 (CCNG1) gene in metastatic cancer, a novel biomarker in development for CCNG1 inhibitor therapy,” which may position CCNG1 as a companion diagnostic for the Delta Rex-G drug
|
▪
|
A study entitled “
The genomic and transcriptomic landscape of left versus right sided breast cancer in 410 cases,” which sheds new light on ESR1 signaling in right sided breast cancers
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
|
(Unaudited)
|
|
|
||||
Assets
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
7,076
|
|
|
$
|
18,305
|
|
Accounts receivable, net
|
13,858
|
|
|
15,286
|
|
||
Inventories
|
303
|
|
|
496
|
|
||
Related party receivables, net
|
938
|
|
|
1,007
|
|
||
Prepaid expenses and other current assets
|
5,726
|
|
|
4,350
|
|
||
Total current assets
|
27,901
|
|
|
39,444
|
|
||
Property, plant, and equipment, net
|
18,152
|
|
|
22,978
|
|
||
Goodwill
|
115,930
|
|
|
115,930
|
|
||
Intangible assets, net
|
56,242
|
|
|
64,703
|
|
||
Investment in related party
|
35,749
|
|
|
40,000
|
|
||
Related party receivable, net of current
|
1,360
|
|
|
1,611
|
|
||
Operating lease right-of-use assets
|
10,783
|
|
|
—
|
|
||
Other assets
|
1,929
|
|
|
1,671
|
|
||
Total assets
|
$
|
268,046
|
|
|
$
|
286,337
|
|
|
|
|
|
||||
Liabilities and Stockholders' Equity (Deficit)
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Accounts payable
|
$
|
3,047
|
|
|
$
|
1,650
|
|
Accrued and other current liabilities
|
12,614
|
|
|
13,832
|
|
||
Deferred revenue
|
17,566
|
|
|
16,263
|
|
||
Related party payables, net
|
4,192
|
|
|
4,791
|
|
||
Total current liabilities
|
37,419
|
|
|
36,536
|
|
||
Deferred revenue, net of current
|
4,329
|
|
|
6,704
|
|
||
Related party liabilities
|
20,939
|
|
|
17,708
|
|
||
Related party promissory note
|
112,666
|
|
|
112,666
|
|
||
Related party convertible note, net
|
8,613
|
|
|
8,378
|
|
||
Convertible notes, net
|
81,957
|
|
|
79,433
|
|
||
Operating lease liabilities
|
11,949
|
|
|
—
|
|
||
Other liabilities
|
20,670
|
|
|
22,081
|
|
||
Total liabilities
|
298,542
|
|
|
283,506
|
|
||
|
|
|
|
||||
Stockholders' equity (deficit)
|
|
|
|
||||
Common stock, $0.0001 par value per share, 750,000,000 shares authorized; 110,454,507 and 109,491,277 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively (including 1 share of restricted stock at both dates)
|
11
|
|
|
11
|
|
||
Additional paid-in capital
|
888,461
|
|
|
887,289
|
|
||
Accumulated deficit
|
(918,758
|
)
|
|
(884,122
|
)
|
||
Accumulated other comprehensive loss
|
(210
|
)
|
|
(347
|
)
|
||
Total stockholders' (deficit) equity
|
(30,496
|
)
|
|
2,831
|
|
||
Total liabilities and stockholders' equity (deficit)
|
$
|
268,046
|
|
|
$
|
286,337
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Total net revenue
|
$
|
25,686
|
|
|
$
|
22,047
|
|
|
$
|
49,415
|
|
|
$
|
44,311
|
|
|
|
|
|
|
|
|
|
||||||||
Total cost of revenue
|
9,816
|
|
|
10,582
|
|
|
21,105
|
|
|
21,651
|
|
||||
Gross Profit
|
15,870
|
|
|
11,465
|
|
|
28,310
|
|
|
22,660
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
||||||||
Selling, general and administrative
|
15,177
|
|
|
18,388
|
|
|
31,967
|
|
|
39,122
|
|
||||
Research and development
|
4,584
|
|
|
5,889
|
|
|
9,664
|
|
|
11,040
|
|
||||
Amortization of acquisition-related assets
|
1,054
|
|
|
1,054
|
|
|
2,108
|
|
|
2,108
|
|
||||
Impairment of intangible assets
|
3,977
|
|
|
—
|
|
|
3,977
|
|
|
—
|
|
||||
Total operating expenses
|
24,792
|
|
|
25,331
|
|
|
47,716
|
|
|
52,270
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Loss from operations
|
(8,922
|
)
|
|
(13,866
|
)
|
|
(19,406
|
)
|
|
(29,610
|
)
|
||||
Interest expense, net
|
(4,473
|
)
|
|
(4,262
|
)
|
|
(8,887
|
)
|
|
(8,460
|
)
|
||||
Other income (expense), net
|
1,054
|
|
|
(1,334
|
)
|
|
(1,451
|
)
|
|
(1,154
|
)
|
||||
Loss from related party equity method investment
|
(2,208
|
)
|
|
(2,945
|
)
|
|
(4,418
|
)
|
|
(6,206
|
)
|
||||
Loss from continuing operations before income taxes
|
(14,549
|
)
|
|
(22,407
|
)
|
|
(34,162
|
)
|
|
(45,430
|
)
|
||||
Provision for (benefit from) income taxes
|
133
|
|
|
(601
|
)
|
|
359
|
|
|
(1,651
|
)
|
||||
Net loss from continuing operations
|
(14,682
|
)
|
|
(21,806
|
)
|
|
(34,521
|
)
|
|
(43,779
|
)
|
||||
Loss from discontinued operations, net of tax
|
(31
|
)
|
|
(1,591
|
)
|
|
(115
|
)
|
|
(1,785
|
)
|
||||
Net loss
|
$
|
(14,713
|
)
|
|
$
|
(23,397
|
)
|
|
$
|
(34,636
|
)
|
|
$
|
(45,564
|
)
|
|
|
|
|
|
|
|
|
||||||||
Net loss per share:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
|
|
|
|
|
|
|
||||||||
Basic and diluted - common stock
|
$
|
(0.13
|
)
|
|
$
|
(0.20
|
)
|
|
$
|
(0.31
|
)
|
|
$
|
(0.40
|
)
|
|
|
|
|
|
|
|
|
||||||||
Discontinued operations
|
|
|
|
|
|
|
|
||||||||
Basic and diluted - common stock
|
$
|
—
|
|
|
$
|
(0.01
|
)
|
|
$
|
—
|
|
|
$
|
(0.02
|
)
|
|
|
|
|
|
|
|
|
||||||||
Total net loss per share
|
|
|
|
|
|
|
|
||||||||
Basic and diluted - common stock
|
$
|
(0.13
|
)
|
|
$
|
(0.21
|
)
|
|
$
|
(0.31
|
)
|
|
$
|
(0.42
|
)
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic and diluted - common stock
|
110,209,510
|
|
|
109,120,438
|
|
|
110,057,981
|
|
|
108,851,348
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Software-as-a-service related
|
$
|
18,291
|
|
|
$
|
16,220
|
|
|
$
|
36,093
|
|
|
$
|
32,386
|
|
Software and hardware related
|
3,099
|
|
|
885
|
|
|
$
|
4,126
|
|
|
$
|
2,340
|
|
||
Maintenance
|
2,535
|
|
|
2,388
|
|
|
5,028
|
|
|
4,835
|
|
||||
Total software-related revenue
|
23,925
|
|
|
19,493
|
|
|
45,247
|
|
|
39,561
|
|
||||
Sequencing and molecular analysis
|
491
|
|
|
924
|
|
|
1,305
|
|
|
1,764
|
|
||||
Home health care services
|
1,270
|
|
|
1,630
|
|
|
2,863
|
|
|
2,986
|
|
||||
Total net revenue
|
$
|
25,686
|
|
|
$
|
22,047
|
|
|
$
|
49,415
|
|
|
$
|
44,311
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of Revenue:
|
|
|
|
|
|
|
|
||||||||
Software-as-a-service related
|
$
|
5,743
|
|
|
$
|
5,741
|
|
|
$
|
11,495
|
|
|
$
|
12,342
|
|
Software and hardware related
|
794
|
|
|
789
|
|
|
1,579
|
|
|
1,675
|
|
||||
Maintenance
|
311
|
|
|
234
|
|
|
581
|
|
|
449
|
|
||||
Amortization of developed technologies
|
1,143
|
|
|
1,293
|
|
|
2,376
|
|
|
2,466
|
|
||||
Total software-related cost of revenue
|
7,991
|
|
|
8,057
|
|
|
16,031
|
|
|
16,932
|
|
||||
Sequencing and molecular analysis
|
1,177
|
|
|
1,689
|
|
|
3,603
|
|
|
3,120
|
|
||||
Home health care services
|
648
|
|
|
836
|
|
|
1,471
|
|
|
1,599
|
|
||||
Total cost of revenue
|
$
|
9,816
|
|
|
$
|
10,582
|
|
|
$
|
21,105
|
|
|
$
|
21,651
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net loss from continuing operations
|
$
|
(14,682
|
)
|
|
$
|
(21,806
|
)
|
|
$
|
(34,521
|
)
|
|
$
|
(43,779
|
)
|
Adjustments to GAAP net loss:
|
|
|
|
|
|
|
|
||||||||
Loss from related party equity method investment
|
2,208
|
|
|
2,945
|
|
|
4,418
|
|
|
6,206
|
|
||||
Stock-based compensation expense from continuing operations
|
673
|
|
|
1,808
|
|
|
1,323
|
|
|
4,432
|
|
||||
Acquisition related sales incentive
|
—
|
|
|
425
|
|
|
—
|
|
|
570
|
|
||||
Change in fair value of derivatives liability
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
||||
Change in fair value of Bookings Commitment
|
(989
|
)
|
|
—
|
|
|
1,505
|
|
|
—
|
|
||||
Impairment of Investment in IOBS
|
—
|
|
|
1,750
|
|
|
—
|
|
|
1,750
|
|
||||
Noncash interest expense related to convertible notes
|
1,403
|
|
|
1,235
|
|
|
2,760
|
|
|
2,429
|
|
||||
Intangible amortization from continuing operations
|
2,197
|
|
|
2,347
|
|
|
4,484
|
|
|
4,574
|
|
||||
Impairment of intangible assets
|
3,977
|
|
|
—
|
|
|
3,977
|
|
|
—
|
|
||||
Loss on sale of business
|
582
|
|
|
—
|
|
|
582
|
|
|
—
|
|
||||
Securities litigation costs
|
—
|
|
|
749
|
|
|
—
|
|
|
823
|
|
||||
Tax provision (benefit) resulting from certain noncash tax items
|
255
|
|
|
(599
|
)
|
|
366
|
|
|
(1,706
|
)
|
||||
Total adjustments to GAAP net loss from continuing operations
|
10,306
|
|
|
10,659
|
|
|
19,415
|
|
|
19,077
|
|
||||
Net loss - Non-GAAP from continuing operations
|
$
|
(4,376
|
)
|
|
$
|
(11,147
|
)
|
|
$
|
(15,106
|
)
|
|
$
|
(24,702
|
)
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding
|
110,209,510
|
|
|
109,120,438
|
|
|
110,057,981
|
|
|
108,851,348
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net loss per share from continuing operations - Non-GAAP
|
$
|
(0.04
|
)
|
|
$
|
(0.10
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.23
|
)
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net loss from continuing operations
|
$
|
(0.13
|
)
|
|
$
|
(0.20
|
)
|
|
$
|
(0.31
|
)
|
|
$
|
(0.40
|
)
|
Adjustments to GAAP net loss per common share from continuing operations:
|
|
|
|
|
|
|
|
||||||||
Loss from related party equity method investment
|
0.01
|
|
|
0.03
|
|
|
0.03
|
|
|
0.06
|
|
||||
Stock-based compensation expense from continuing operations
|
0.01
|
|
|
0.02
|
|
|
0.01
|
|
|
0.04
|
|
||||
Acquisition related sales incentive
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Change in fair value of derivatives liability
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Change in fair value of Bookings Commitment
|
(0.01
|
)
|
|
—
|
|
|
0.01
|
|
|
—
|
|
||||
Impairment of Investment in IOBS
|
—
|
|
|
0.02
|
|
|
—
|
|
|
0.02
|
|
||||
Noncash interest expense related to convertible notes
|
0.01
|
|
|
0.01
|
|
|
0.03
|
|
|
0.02
|
|
||||
Intangible amortization from continuing operations
|
0.02
|
|
|
0.02
|
|
|
0.04
|
|
|
0.04
|
|
||||
Impairment of intangible assets
|
0.04
|
|
|
—
|
|
|
0.04
|
|
|
—
|
|
||||
Loss on sale of business
|
0.01
|
|
|
—
|
|
|
0.01
|
|
|
—
|
|
||||
Securities litigation costs
|
—
|
|
|
0.01
|
|
|
—
|
|
|
0.01
|
|
||||
Tax provision (benefit) resulting from certain noncash tax items
|
—
|
|
|
(0.01
|
)
|
|
—
|
|
|
(0.02
|
)
|
||||
Total adjustments to GAAP net loss per common share from continuing operations
|
0.09
|
|
|
0.10
|
|
|
0.17
|
|
|
0.17
|
|
||||
Net loss per common share from continuing operations - Non-GAAP
|
$
|
(0.04
|
)
|
|
$
|
(0.10
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.23
|
)
|