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Stock-Based Compensation | 6 Months Ended
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Jun. 30, 2022
Share-Based Payment Arrangement [Abstract] |
Stock-Based Compensation | STOCK-BASED COMPENSATION On November 30, 2017, the Company’s stockholders approved the adoption of the 2017 Employee, Director and Consultant Equity Incentive Plan (as amended, the “2017 Plan”). The 2017 Plan allows the Company, under the direction of the Compensation and Human Capital Committee of the Board of Directors, to make grants of restricted and unrestricted stock awards to employees, consultants, and directors. Stockholders have approved amendments to the 2017 Plan increasing the shares available to grant. As of June 30, 2022, the Company has 2.0 million shares of common stock available for grant under the 2017 Plan. If an RSU awarded under the 2017 Plan is cancelled or forfeited without the issuance of shares of common stock, the unissued or reacquired shares that were subject to the RSU will again be available for issuance pursuant to the 2017 Plan. To the extent that awards outstanding under the Company's prior equity plans expire or are cancelled without delivery of shares of common stock, they also will be available for issuance pursuant to the 2017 Plan. The number of shares, terms, and vesting periods are generally determined by the Company’s Board of Directors or a committee thereof on an award-by-award basis. RSUs granted to employees generally vest ratably over four years or after three years either on the anniversary of the date on which the RSUs were granted or during the month in which such anniversary dates occur. The number of performance-based RSUs ("PSUs") awarded to certain employees may be increased or may be reduced based on certain additional performance and market metrics. Options and RSUs granted to non-employee directors vest in full upon the earlier of the completion of one year of service following the date of the grant or the date of the next annual meeting of stockholders following such grant. Options granted generally expire ten years from the date of grant. Options granted to the Company's President and Chief Executive Officer as an inducement to his employment expire seven years from the grant date. The performance and market conditions associated with PSU awards granted during the six months ended June 30, 2022 include vesting that is based on revenue growth targets (34% weighting), adjusted earnings per share targets (33% weighting), and relative total stockholder return (33% weighting) measured against the Nasdaq Health Care Index (IXHC) using the 20-trading day averages at the beginning and end of the measurement period. The measurement period for the PSUs is January 1, 2022 through December 31, 2024. The Company estimates the likelihood of achievement of performance conditions at the end of each period. The portion of the awards pertaining to relative total stockholder return represent market based awards and, accordingly, the estimated fair value of such awards are recognized over the performance period. We have also assessed that as of June 30, 2022 the performance conditions for the remaining two performance targets (revenue growth and adjusted earnings per share) are considered probable of being achieved and, accordingly, these portions of the awards are also being expensed over the performance period. Stock Options A summary of the stock option activity under the Company’s equity plans and inducement awards, for the six months ended June 30, 2022 is as follows:
(number of shares in millions) | Number of Shares |  | Weighted Average Exercise Price
Options outstanding at December 31, 2021 | 1.4 |  |  | $ | 20.36 |
Less: |  |  |
Options exercised | — |  |  | $ | 23.98 |
Options canceled or expired | (0.1) |  |  | $ | 25.26 |
Options outstanding at June 30, 2022 | 1.3 |  |  | $ | 20.09 |
Options exercisable at June 30, 2022 | 0.9 |  |  | $ | 22.91 |
As of June 30, 2022, there was $1.7 million of total unrecognized stock-based compensation expense related to stock options that will be recognized over a weighted-average period of 1.6 years. There were no options granted during the six months ended June 30, 2022. Restricted Stock Units A summary of the RSU awards activity under the Company’s equity plans and inducement awards, including RSU awards with performance metrics, for the six months ended June 30, 2022 is as follows:
(number of shares in millions) | Number of Shares |  | Weighted Average Grant Date Fair Value
RSUs outstanding at December 31, 2021 | 3.1 |  |  | $ | 24.96 |
RSUs granted | 1.8 |  |  | $ | 26.50 |
Less: |  |  |
RSUs vested | (0.6) |  |  | $ | 28.08 |
RSUs canceled | (0.2) |  |  | $ | 26.57 |
RSUs outstanding at June 30, 2022 | 4.1 |  |  | $ | 25.07 |
As of June 30, 2022, there was $80.5 million of total unrecognized stock-based compensation expense related to RSUs that will be recognized over a weighted-average period of 2.5 years. Employee Stock Purchase Plan The Company also has an Employee Stock Purchase Plan that was approved by stockholders in 2012 under which 2.0 million shares of common stock were originally authorized. On September 23, 2021, the Board of Directors of the Company approved an Amended and Restated 2012 Employee Stock Purchase Plan (the "Amended and Restated Purchase Plan"), which authorized an additional 2.0 million shares of common stock and extended the term of the plan to November 30, 2032, subject in each case to obtaining stockholder approval. The Company's stockholders subsequently approved the Amended and Restated Purchase Plan on June 2, 2022. The Amended and Restated Purchase Plan also expanded the definition of "offering period" to provide that the Board of Directors may determine the period in accordance with the terms of the plan, and capped the number of shares that may be purchased by any participant during an offering period at 5,000 shares. Shares are issued under the Amended and Restated Purchase Plan twice yearly at the end of each offering period. As of June 30, 2022, 1.8 million shares of common stock were available for issuance under the Amended and Restated Purchase Plan. Stock-Based Compensation Expense Stock-based compensation expense recognized and included in the Condensed Consolidated Statements of Operations and Comprehensive Loss was allocated as follows:
| Three months ended June 30, |  | Six months ended June 30,
(in millions) | 2022 |  |  | 2021 |  | 2022 |  |  | 2021
Cost of molecular diagnostic testing | $ | 0.5 |  |  |  | $ | 0.4 |  |  | $ | 0.8 |  |  |  | $ | 0.7 |
Cost of pharmaceutical and clinical services | — |  |  |  | — |  |  | — |  |  |  | 0.1 |
Research and development expense | 1.0 |  |  |  | 1.0 |  |  | 3.4 |  |  |  | 2.5 |
Selling, general, and administrative expense | 8.9 |  |  |  | 7.5 |  |  | 16.3 |  |  |  | 14.6 |
Total stock-based compensation expense | $ | 10.4 |  |  |  | $ | 8.9 |  |  | $ | 20.5 |  |  |  | $ | 17.9 |

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