UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
November 4, 2021
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) (IRS Employer
Identification No.)

3000 RDU Drive, Suite 200
Morrisville, North Carolina 27560
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (855) 949-6268

9920 Jefferson Boulevard
Culver City, California 90232
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, par value $0.0001 per share NH Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §(§230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §(§240.12b-2).

Emerging growth company

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 



Item 2.02 Results of Operations and Financial Condition.

On November 4, 2021, NantHealth, Inc. publicly disseminated a press release announcing its financial results for the three months ended September 30, 2021. A copy of the press release is furnished as Exhibit 99.1 hereto and incorporated herein by reference.

As provided in General Instruction B.2 to Form 8-K, the information furnished in Item 2.02 and Exhibit 99.1 of this Current Report on Form 8-K shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section, and such information shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01
Financial Statements and Exhibits.

(d) Exhibits. The following is furnished as an exhibit to this Current Report on Form 8-K:

Exhibit No. Description
99.1





SIGNATURE
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 undersigned hereunto duly authorized.
NantHealth, Inc.
Date: November 4, 2021 By: /s/ Bob Petrou
Bob Petrou
Chief Financial Officer


Exhibit 99.1
  NANTHEALTHLOGOAA10A.JPG
Investor Contact:
Robert Jaffe
rjaffe@rjaffeco.com
424.288.4098

NANTHEALTH REPORTS 2021 THIRD QUARTER FINANCIAL RESULTS

Q3 2021 Financial Highlights:
Total net revenue was $14.4 million
Gross margin was 52%
Cash of $45.5 million at September 30, 2021
Operational Highlights:
Signed and preparing to launch first Eviti Connect program for autoimmune disease
Achieved utilization management licensure/certification in six states enabling expansion of Eviti Connect to include fully delegated services
In October, signed multi-year NaviNet Open agreement with third party administration service provider with potential to deploy provider portal capabilities to multiple new self-insured health plans
Also in October, signed agreement with Care Continuity allowing parties to partner on product offerings that improve care logistics for complex, high risk and chronic diseases for health plan and provider customers
Enhanced leadership team with addition of experienced senior-level executives in sales, strategy and human resources

Morrisville, NC – November 04, 2021 — NantHealth, Inc. (NASDAQ-GS: NH), a leading provider of enterprise solutions that help businesses transform complex data into actionable insights, today reported financial results for its third quarter ended September 30, 2021.

"Expansion of our Eviti Connect decision support solution to additional diseases states (beyond oncology) has been a major focus for us this year," said Ron Louks, Chief Operating Officer, NantHealth. "With that in mind, I am pleased to report that, during the third quarter, we signed and are preparing to launch the very first Eviti Connect autoimmune disease program with a key customer and interest in this new offering is strong. This was a significant accomplishment and, when coupled with investments we are making in our network monitoring and management service suite (OpenNMS®) and data capabilities (Quadris™), we believe these advancements lay the foundation for substantial new growth opportunities for our business.

“On the financial front, net revenue for the 2021 third quarter was lower than the previous quarter, primarily due to timing differences between the expiration of certain contracts and the initiation of others. For the 2021 fourth quarter, we expect net revenue to return closer to our average run rate for this year.

“Also, as announced today in a dedicated press release, we added three senior executives to head our sales, strategy and human resource functions. All are accomplished and experienced leaders, and we look forward to the benefit of their insights as we begin the next stage of our growth.”

Software and Services Highlights:

Clinical Decision Support (Eviti®):




Continued expansion of services provided through a key Eviti channel partner, with the addition of two new health plans and expect further growth in the fourth quarter with the addition of a large, multi-state customer-owned health insurer

Signed agreement with Care Continuity, Inc., a leader in network integrity and care navigation, to partner on product offerings that improve care logistics management for complex, high risk and chronic diseases, with an initial focus on extending care pathways for Eviti Connect customers and their members (with NaviNet care pathway opportunities to follow)

Dr. Tiffany Avery, NantHealth Chief Medical Officer, was selected to present continuing education session on advancing equity in cancer care at the Oncology Clinical Pathways Congress. The virtual session took place October 1

Launched Eviti Connect 8.6, which includes more robust savings and ROI visualizations for payer customers via expanded reporting that is enabled by our Quadris data analytics capabilities

Payer Engagement (NaviNet® and Population Health Management):

In October, signed a multi-year agreement with a new third party administrator that will use NaviNet Open to enhance the services it provides to self-insured health plan customers

Signed three-year renewal with a long-term partner and leading provider of drug authorizations, enabling electronic submission of prior authorization for any drug under any plan, including Medicare and Medicaid

Established a collaboration with Intraprise Systems to bring HIPAA One compliance management solutions to the NaviNet provider network, helping providers meet HIPAA compliance requirements and protect patient data

Launched the new NantHealth Help Center, an innovative platform that provides users with easy access to help and training content, online channels to contact support, and tools to view in progress and resolved support requests

Introduced new Authorization Submission APIs that allow providers to automate and streamline prior authorization requests to connected NaviNet payer customers

Network Monitoring and Management (The OpenNMS Group, Inc.):

Renewed agreements with 12 key customers and expanded services with one of the nation’s largest telecom providers (an existing account), reaffirming the value OpenNMS provides its customers

Continued development and preparation for fourth quarter launch of zero-touch appliances, simplifying the deployment of distributed monitoring capabilities at scale

Business and Financial Highlights

For the 2021 third quarter:

Total net revenue was $14.4 million compared with $18.8 million in Q3 of 2020.

Gross profit was $7.5 million, or 52% of total net revenue, compared with $11.2 million, or 60% of total net revenue, for the prior-year period.

Selling, general and administrative (SG&A) expenses increased to $13.0 million from $12.4 million in the 2020 third quarter.

Research and development (R&D) expenses decreased to $4.6 million from $4.7 million.




Net loss from continuing operations, net of tax, was $10.8 million, or $0.09 per share, compared with $11.0 million, or $0.10 per share, in the 2020 third quarter.

Non-GAAP net loss from continuing operations was $11.5 million, or $0.10 per share, compared with $7.2 million, or $0.07 per share, for the third quarter of 2020.

At September 30, 2021, cash and cash equivalents totaled $45.5 million.

Conference Call Information and Forward-Looking Statements
Later today, the Company will host a conference call at 1:30 p.m. PT (4:30 p.m. ET) to review its results of operations for the third quarter ended September 30, 2021. The conference call will be available to interested parties by dialing 800-584-1507 from the U.S. or Canada, or 212-231-2902 from international locations. The call will be broadcast via the Internet at www.nanthealth.com. Listeners are encouraged to visit the website at least 10 minutes prior to the start of the scheduled presentation to register, download and install any necessary audio software. A playback of the call will be archived and accessible on the same website for at least three months.

Discussion during the conference call may include forward-looking statements regarding topics such as the Company’s financial status and performance, regulatory and operational developments, and other comments the Company may make about its future plans or prospects in response to questions from participants on the conference call.

Use of Non-GAAP Financial Measures
This news release contains references to Non-GAAP financial measures, including adjusted net loss and adjusted net loss per share, which are financial measures that are not prepared in conformity with United States generally accepted accounting principles (U.S. GAAP). The Company’s management believes that the presentation of Non-GAAP financial measures provides useful supplementary information regarding operational performance, because it enhances an investor’s overall understanding of the financial results for the Company’s core business. Additionally, it provides a basis for the comparison of the financial results for the Company’s core business between current, past and future periods. Other companies may define these measures in different ways. Non-GAAP financial measures should be considered only as a supplement to, and not as a substitute for or as a superior measure to, financial measures prepared in accordance with U.S. GAAP. Non-GAAP per share numbers are calculated based on one class of common stock and do not incorporate the effects, if any, of using the two-class method.

About NantHealth, Inc.
NantHealth, a member of the NantWorks ecosystem of companies, provides enterprise solutions that help businesses transform complex data into actionable insights. By offering efficient ways to move, interpret and visualize complex and highly sensitive information, NantHealth enables customers in healthcare, life sciences, logistics, telecommunications and other industries to automate, understand and act on data while keeping it secure and scalable. NantHealth’s product portfolio comprises the latest technology in payer/provider collaboration platforms for real-time coverage decision support (Eviti and NaviNet), and data solutions that provide multi-data analysis, reporting and professional services offerings (Quadris). The OpenNMS Group, Inc., a NantHealth subsidiary, helps businesses monitor and manage network health and performance. For more information, visit nanthealth.com, follow us on Twitter, Facebook, LinkedIn and YouTube and subscribe to our blog.

This news release contains certain statements of a forward-looking nature relating to future events or future business performance. Forward-looking statements can be identified by the words “expects,” “anticipates,” “believes,” “intends,” “estimates,” “plans,” “will,” “outlook” and similar expressions. Forward-looking statements are based on management’s current plans, estimates, assumptions and projections, and speak only as of the date they are made. Risks and uncertainties include, but are not limited to: our ability to successfully integrate a complex learning system to address a wide range of healthcare issues; our ability to successfully amass the requisite data to achieve maximum network effects; appropriately allocating financial and human resources across a broad array of product and service offerings; raising additional capital as necessary to fund our operations; our



ability to grow the market for our software and data solutions; successfully enhancing our software and data solutions to achieve market acceptance and keep pace with technological developments; customer concentration; competition; security breaches; bandwidth limitations; our ability to integrate The OpenNMS Group, Inc. into our operations; our use and distribution of open source software; our ability to obtain necessary regulatory approvals, certifications and licenses; dependence upon senior management; the need to comply with and meet applicable laws and regulations; unexpected adverse events; and anticipated cost savings. We undertake no obligation to update any forward-looking statement in light of new information or future events, except as otherwise required by law. Forward-looking statements involve inherent risks and uncertainties, most of which are difficult to predict and are generally beyond our control. Actual results or outcomes may differ materially from those implied by the forward-looking statements as a result of the impact of a number of factors, many of which are discussed in more detail in our reports filed with the Securities and Exchange Commission.

FINANCIAL TABLES FOLLOW



NantHealth, Inc.
Consolidated Balance Sheets
(Dollars in thousands)
September 30,
2021
December 31,
2020
(Unaudited)
Assets
Current assets
Cash and cash equivalents $ 45,513  $ 22,787 
Accounts receivable, net 4,504  3,273 
Related party receivables, net 1,516  1,031 
Prepaid expenses and other current assets 5,262  3,504 
Total current assets 56,795  30,595 
Property, plant, and equipment, net 12,875  13,102 
Goodwill 98,333  98,333 
Intangible assets, net 41,272  47,969 
Related party receivable, net of current —  823 
Operating lease right-of-use assets 6,497  7,539 
Other assets 1,596  1,927 
Total assets $ 217,368  $ 200,288 
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable $ 2,069  $ 5,122 
Accrued and other current liabilities 14,380  13,975 
Deferred revenue 1,938  1,166 
Related party payables, net 5,136  4,238 
Notes payable 1,557  268 
Related party convertible note, net 4,995  9,411 
Convertible notes, net 4,488  90,578 
Total current liabilities 34,563  124,758 
Deferred revenue, net of current 1,682  393 
Related party liabilities 36,465  31,091 
Related party promissory note 112,666  112,666 
Related party convertible note, net 62,251  — 
Convertible notes, net 74,583  — 
Deferred income taxes, net 1,673  1,853 
Operating lease liabilities 6,878  8,170 
Other liabilities 33,398  32,757 
Total liabilities 364,159  311,688 
Commitments and Contingencies (Note 14)
Stockholders' deficit
Common stock, $0.0001 par value per share, 750,000,000 shares authorized; 115,307,744 and 111,284,733 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively
12  11 
Additional paid-in capital 889,620  891,583 
Accumulated deficit (1,036,192) (1,003,210)
Accumulated other comprehensive loss (231) (168)
Total NantHealth stockholders' deficit (146,791) (111,784)
Noncontrolling interests —  384 
Total stockholders' deficit (146,791) (111,400)
Total liabilities and stockholders' deficit $ 217,368  $ 200,288 



NantHealth, Inc.
Consolidated Statements of Operations
(Dollars in thousands, except per share amounts)
(Unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2021 2020 2021 2020
Revenue
Software-as-a-service related $ 13,879  $ 18,355  $ 45,140  $ 53,997 
Maintenance 406  299  1,201  299 
Professional services 57  62  257  62 
Total software-related revenue 14,342  18,716  46,598  54,358 
Other 17  49  20  172 
Total net revenue 14,359  18,765  46,618  54,530 
Cost of Revenue:
Software-as-a-service related 5,244  5,935  16,223  17,552 
Maintenance 298  131  775  131 
Professional services 15  13  15 
Amortization of developed technologies 1,247  1,222  3,741  3,508 
Total software-related cost of revenue 6,795  7,303  20,752  21,206 
Other 34  216  127  827 
Total cost of revenue 6,829  7,519  20,879  22,033 
Gross Profit 7,530  11,246  25,739  32,497 
Operating Expenses
Selling, general and administrative 12,969  12,442  37,309  36,864 
Research and development 4,648  4,681  14,510  12,446 
Amortization of acquisition-related assets
985  958  2,956  2,691 
Total operating expenses 18,602  18,081  54,775  52,001 
Loss from operations (11,072) (6,835) (29,036) (19,504)
Interest expense, net (3,572) (4,861) (10,943) (14,291)
Other income (expense), net 3,759  747  (1,862) (2,550)
Loss from related party equity method investment
—  —  —  (31,702)
Loss from continuing operations before income taxes (10,885) (10,949) (41,841) (68,047)
Provision for income taxes 23  77  21  174 
Net loss from continuing operations (10,908) (11,026) (41,862) (68,221)
Income (loss) from discontinued operations, net of tax attributable to NantHealth —  (16) 24  31,955 
Net loss (10,908) (11,042) (41,838) (36,266)
Net loss attributable to non-controlling interests (65) (42) (284) (42)
Net loss attributable to NantHealth $ (10,843) $ (11,000) $ (41,554) $ (36,224)
Basic and diluted net (loss) income per share attributable to NantHealth:
Continuing operations - common stock $ (0.09) $ (0.10) $ (0.37) $ (0.62)
Discontinued operations - common stock $ —  $ —  $ —  $ 0.29 
Total net loss per share - common stock $ (0.09) $ (0.10) $ (0.37) $ (0.33)
Weighted average shares outstanding
Basic and diluted - common stock 115,243,671  110,929,357  113,706,124  110,859,611 



NantHealth, Inc.
Non-GAAP Net Loss from Continuing Operations Attributable to NantHealth and
Non-GAAP Net Loss Per Share from Continuing Operations Attributable to NantHealth
(Dollars in thousands, except per share amounts)
(Unaudited)
Three Months Ended
September 30,
Nine Months Ended September 30,
2021 2020 2021 2020
Net loss from continuing operations attributable to NantHealth $ (10,843) $ (10,984) $ (41,578) $ (68,179)
Adjustments to GAAP net loss from continuing operations attributable to NantHealth:
Loss on Exchange and Prepayment of 2016 Notes —  —  742  — 
Loss from related party equity method investment
—  —  —  31,702 
Stock-based compensation expense from continuing operations
799  633  2,533  1,761 
Change in fair value of derivatives liability —  (56) (4)
Change in fair value of Bookings Commitment (3,670) (657) 1,133  3,070 
Noncash interest expense related to convertible notes
58  1,644  568  4,779 
Intangible amortization from continuing operations
2,222  2,165  6,646  6,184 
Securities litigation costs —  —  —  (103)
Tax benefit (provision) resulting from certain noncash tax items (17) 20  (105) (16)
Total adjustments to GAAP net loss from continuing operations attributable to NantHealth (608) 3,749  11,513  47,384 
Net loss from continuing operations attributable to NantHealth - Non-GAAP $ (11,451) $ (7,235) $ (30,065) $ (20,795)
Weighted average basis common shares outstanding 115,243,671  110,929,357  113,706,124  110,859,611 
Net loss per common share from continuing operations attributable to NantHealth - Non-GAAP $ (0.10) $ (0.07) $ (0.26) $ (0.19)





Reconciliation of Net Loss per Common Share from Continuing Operations Attributable to NantHealth
to Net Loss per Common Share from Continuing Operations Attributable to NantHealth - Non-GAAP
(Unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2021 2020 2021 2020
Net loss per common share from continuing operations attributable to NantHealth $ (0.09) $ (0.10) $ (0.37) $ (0.62)
Adjustments to GAAP net loss per common share from continuing operations attributable to NantHealth:
Loss on Exchange and Prepayment of 2016 Notes —  —  0.01  — 
Loss from related party equity method investment
—  —  —  0.28 
Stock-based compensation expense from continuing operations
0.01  0.01  0.03  0.02 
Change in fair value of derivatives liability —  —  —  — 
Change in fair value of Bookings Commitment (0.04) (0.01) 0.01  0.03 
Noncash interest expense related to convertible notes
—  0.01  —  0.04 
Intangible amortization from continuing operations
0.02  0.02  0.06  0.06 
Securities litigation costs —  —  —  — 
Tax benefit (provision) resulting from certain noncash tax items —  —  —  — 
Total adjustments to GAAP net loss per common share from continuing operations attributable to NantHealth (0.01) 0.03  0.11  0.43 
Net loss per common share from continuing operations attributable to NantHealth - Non-GAAP $ (0.10) $ (0.07) $ (0.26) $ (0.19)