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STOCK INCENTIVE PLANS | 6 Months Ended
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Jun. 30, 2024
Share-Based Payment Arrangement [Abstract] |
STOCK INCENTIVE PLANS | STOCK INCENTIVE PLANS Stock Options and Restricted Stock Units (“RSU”) The following table summarizes option and RSU activity under the Company’s 2014 Equity Incentive Plan, 2016 Inducement Equity Incentive Plan, 2019 Inducement Equity Incentive Plan and 2024 Equity Incentive Plan, and related information:
| Shares Available for Grant |  | Stock Options Outstanding |  | Weighted- Average Exercise Price |  | Number of RSU Shares |  | Weighted- Average Grant Date Fair Value
Balance—December 31, 2023 | 869,111 |  |  | 3,055,208 |  |  | $ | 25.21 |  |  | 5,006,775 |  |  | $ | 19.02 |
Additional shares authorized | 6,748,645 |  |  | — |  |  | — |  |  | — |  |  | — |
Common stock awards for services | (11,748) |  |  | — |  |  | — |  |  | — |  |  | — |
RSUs granted | (3,360,339) |  |  | — |  |  | — |  |  | 3,360,339 |  |  | 9.32 |
RSUs vested | — |  |  | — |  |  | — |  |  | (1,456,490) |  |  | 18.14 |
Options granted | (854,898) |  |  | 854,898 |  |  | 9.29 |  |  | — |  |  | — |
Options exercised | — |  |  | (20,037) |  |  | 6.54 |  |  | — |  |  | — |
Repurchase of common stock under employee incentive plans | 391,535 |  |  | — |  |  | — |  |  | — |  |  | — |
RSUs forfeited | 247,195 |  |  | — |  |  | — |  |  | (247,195) |  |  | 17.32 |
Options forfeited | 21,809 |  |  | (21,809) |  |  | 27.94 |  |  | — |  |  | — |
Options expired | 85,247 |  |  | (85,247) |  |  | 30.19 |  |  | — |  |  | — |
Balance—June 30, 2024 | 4,136,557 |  |  | 3,783,013 |  |  | $ | 21.58 |  |  | 6,663,429 |  |  | $ | 14.54 |
The total intrinsic value of options exercised was less than $0.1 million for each of the three and six months ended June 30, 2024 and 2023. As of June 30, 2024, the total intrinsic value of outstanding RSUs was approximately $106.1 million and there were $57.4 million of unrecognized compensation costs related to RSUs, which are expected to be recognized over a weighted-average period of 2.33 years. The Company granted performance restricted stock units ("PSUs"), included in RSUs, under the 2014 Plan. The PSUs granted to employees consist of financial and operational metrics to be met over a performance period of 2 years. The number of shares outstanding was 412,843 and 449,983 as of June 30, 2024 and December 31, 2023, respectively. The weighted-average remaining recognition period was 0.59 years and 1.01 years as of June 30, 2024 and December 31, 2023, respectively. Options outstanding that have vested and are expected to vest at June 30, 2024 are as follows:
| Number of Shares Issued (In thousands) |  | Weighted-Average Exercise Price |  | Weighted-Average Remaining Contractual Life (Years) |  | Aggregate Intrinsic Value (In thousands)
Vested | 2,122 |  |  | $ | 25.06 |  |  | 6.34 |  | $ | 3,836 |
Expected to vest | 1,474 |  |  | 17.53 |  |  | 8.07 |  | 4,376 |
Total | 3,596 |  |  |  |  |  |  | $ | 8,212 |
The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying stock options and the fair value of the Company’s common stock at June 30, 2024 for stock options that were in-the-money. The total fair value of options that vested during the three and six months ended June 30, 2024 was $2.7 million and $6.4 million, respectively. As of June 30, 2024, there were approximately $16.8 million of unrecognized compensation costs related to stock options, which are expected to be recognized over a weighted-average period of 2.69 years. 2014 Employee Stock Purchase Plan The Company has an Employee Stock Purchase Plan (the “ESPP”), under which employees can purchase shares of its common stock based on a percentage of their compensation, but not greater than 15% of their respective earnings; provided, however, an eligible employee’s right to purchase shares of the Company’s common stock may not accrue at a rate which exceeds $25,000 of the fair market value of such shares for each calendar year in which such rights are outstanding. The ESPP has consecutive offering periods of approximately six months in length. The purchase price per share must be equal to the lower of 85% of the fair value of the common stock on the first day of the offering period or on the exercise date. During the offering period in 2024 that ended on June 30, 2024, 85,260 shares were purchased pursuant to the ESPP for aggregate proceeds of $0.9 million from the issuance of such shares, which occurred on July 2, 2024. During the offering period in 2023 that ended on December 31, 2023, 73,759 shares were purchased pursuant to the ESPP for aggregate proceeds of $0.5 million from the issuance of such shares, which occurred on January 2, 2024. Valuation Assumptions The estimated fair values of employee stock options and ESPP shares were estimated using the Black-Scholes option pricing model based on the following weighted average assumptions:
|  | Three Months Ended June 30, |  | Six Months Ended June 30,
|  | 2024 |  | 2023 |  | 2024 |  | 2023
Employee stock options |  |  |  |  |  |  |  |
Expected term (in years) |  | 5.8 |  | 5.0 |  | 5.8 |  | 5.6
Expected volatility |  | 76.52% |  | 76.63% |  | 76.52% |  | 77.86%
Risk-free interest rate |  | 4.57% |  | 3.99% |  | 4.57% |  | 3.67%
Expected dividend yield |  | —% |  | —% |  | —% |  | —%
Employee stock purchase plan |  |  |  |  |  |  |  |
Expected term (in years) |  | 0.5 |  | 0.5 |  | 0.5 |  | 0.5
Expected volatility |  | 91.99% |  | 93.38% |  | 91.99% |  | 93.38%
Risk-free interest rate |  | 5.24% |  | 5.47% |  | 5.24% |  | 5.47%
Expected dividend yield |  | —% |  | —% |  | —% |  | —%
Risk-free Interest Rate: The Company based the risk-free interest rate over the expected term of the award based on the constant maturity rate of U.S. Treasury securities with similar maturities as of the date of grant. Volatility: The Company used an average historical stock price volatility of its own stock. Expected Term: The expected term represents the period for which the Company’s stock-based compensation awards are expected to be outstanding and is based on analyzing the vesting and contractual terms of the awards and the holders’ historical exercise patterns and termination behavior. Expected Dividends: The Company has not paid and does not anticipate paying any dividends in the near future. Stock-Based Compensation Expense The following table summarizes stock-based compensation expense relating to employee and non-employee stock-based awards for the three and six months ended June 30, 2024 and 2023, included in the condensed consolidated statements of operations as follows (in thousands):
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2024 |  | 2023 |  | 2024 |  | 2023
Cost of testing services | $ | 357 |  |  | $ | 492 |  |  | $ | 814 |  |  | $ | 971 |
Cost of product | 225 |  |  | 274 |  |  | 542 |  |  | 634 |
Cost of patient and digital solutions | 350 |  |  | 367 |  |  | 722 |  |  | 769 |
Research and development | 1,628 |  |  | 1,704 |  |  | 3,388 |  |  | 3,666 |
Sales and marketing | 2,927 |  |  | 2,779 |  |  | 5,971 |  |  | 6,516 |
General and administrative | 7,683 |  |  | 7,084 |  |  | 15,077 |  |  | 13,898 |
Total | $ | 13,170 |  |  | $ | 12,700 |  |  | $ | 26,514 |  |  | $ | 26,454 |
No tax benefit was recognized related to stock-based compensation expense since the Company has never reported taxable income and has established a full valuation allowance to offset all of the potential tax benefits associated with its deferred tax assets. In addition, no amounts of stock-based compensation expense were capitalized for the periods presented.

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