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Business Combinations (Tables)
 9 Months Ended
Sep. 30, 2021
Business Acquisition [Line Items]  
Schedule of Identifiable Intangible Assets and Estimated Useful Life

The valuation of identifiable intangible assets and applicable estimated useful lives are as follows (in thousands, except for useful life):

 

 Schedule of Identifiable Intangible Assets and Estimated Useful Life

   Estimated
Assets		   Useful Life 
   Fair Value   (Years) 
In process research and development (“IPR&D”)  $14,650    n/a  
Customer relationships   440    5 
   $15,090      
Schedule of Fair Value of Contingent Consideration Liability

The following table shows the Insight Merger Date contractual payment amounts, as applicable, and the corresponding fair value of each respective Contingent Consideration liability (in thousands):

 Schedule of Fair Value of Contingent Consideration Liability

       Fair 
   Contractual   Value on the 
   Value   Merger Date 
Milestone 1  $1,500   $1,340 
Milestone 2   3,000    1,830 
Milestone 3 (a)   1,500    770 
Royalty 1 (b)   See(b)     5,980 
Royalty 2 (b)   See(b)     1,210 
Total  $6,000   $11,130 

 

(a) Indicates the maximum payable if the Milestone is achieved.

 

(b)

As defined, Royalty Payments are based on a percentage of future revenues of DetermaIO™ and Pharma Services over their respective useful life, accordingly there is no fixed contractual value for the Royalty Contingent Consideration.
Schedule of Contingent Consideration, Measured at Fair Value

The following table reflects the activity for Oncocyte’s Contingent Consideration since the Insight Merger Date, measured at fair value using Level 3 inputs (in thousands):

 Schedule of Contingent Consideration, Measured at Fair Value

   Fair Value 
Balance at December 31, 2020  $7,120 
Change in estimated fair value   2,260 
Balance at September 30, 2021  $9,380 
Summary of Acquisition Intangible Assets

On February 24, 2021, upon Oncocyte’s acquisition of the outstanding common stock of Razor, the Razor intangible asset balance recorded on the acquisition date and included in Intangible Assets was as follows (in thousands):

Summary of Acquisition Intangible Assets 

   As of
February 24,		 
   2021 
Razor intangible asset recorded on the acquisition date:     
Equity method investment carrying value  $13,147 
Cash paid as Additional Purchase Payment for the Razor asset   10,000 
Oncocyte common stock issued (982,318 shares issued at market value) as Additional Purchase Payment   5,756 
Less: cash balance received from Razor for Clinical Trial expenses   (3,352)
Deferred tax liability generated from the Razor asset   7,564 
Other   169 
      
Total Razor investment asset balance as of February 24, 2021 (a)  $33,284 

 

(a) This balance will be amortized over the remaining useful life of the Razor asset, approximating 8.5 years, as of the February 24, 2021 acquisition date, with the amortization expense included in “Cost of revenues – amortization of acquired intangibles” on the condensed consolidated statements of operations.
Schedule of Condensed Statement of Operations

The unaudited standalone results of operations for Razor prior to being consolidated with Oncocyte is summarized below (in thousands):

 Schedule of Condensed Statement of Operations

   For the period from 
   January 1, 2021 through 
   February 23, 2021 
Condensed Statement of Operations (1)  (unaudited) 
Research and development expense  $125 
General and administrative expense   - 
Loss from operations   (125)
Net loss  $(125)

 

(1)

The condensed standalone statement of operations of Razor is provided for informational purposes only. Razor’s results for the period from January 1, 2021 through February 23, 2021 are not included in Oncocyte’s consolidated results of operations because Razor was not consolidated with Oncocyte’s financial statements but had been accounted for under the equity method of accounting since the September 30, 2019 Initial Closing date, however, Oncocyte’s results included its pro rata losses from Razor. Beginning on February 24, 2021, Razor’s results are included with Oncocyte’s consolidated results, primarily consisting of outside research and development expenses incurred by Razor for the Clinical Trial discussed above.
Insight Merger Agreements [Member]  
Business Acquisition [Line Items]  
Schedule of Fair Value of Aggregate Merger Consideration

Schedule of Fair Value of Aggregate Merger Consideration 

Cash consideration  $7,000(1)
      
Stock consideration     
      
Shares of Oncocyte common stock issued on the Merger Date   1,915,692(2)
      
Closing price per share of Oncocyte common stock on the Merger Date  $2.61 
      
Market value of Oncocyte common stock issued  $5,000 
      
Contingent Consideration  $11,130(3)
      
Total fair value of consideration transferred on the Merger Date  $23,130 

 

(1) The cash consideration paid on the Insight Merger Date was $6.4 million, which was net of a $0.6 million cash holdback discussed above, recorded as a holdback liability since Oncocyte retained the cash. In accordance with ASC 805, amounts held back for general representations and warranties of the sellers are included as part of the total consideration transferred.

 

(2) The 229,885 Stock Holdback shares were placed in an escrow account and considered to be issued and outstanding Oncocyte common stock. In accordance with ASC 805, amounts held back for general representations and warranties of the sellers, including escrowed shares of common stock, are included as part of the total consideration transferred.

 

(3)

In accordance with ASC 805, Contingent Consideration, at fair value, is part of the total considered transferred on the Insight Merger Date, as further discussed below.
Schedule of Intangible Assets Acquired and Liabilities Assumed

The following table sets forth the allocation of the Aggregate Merger Consideration transferred to Insight’s tangible and identifiable intangible assets acquired and liabilities assumed on the Insight Merger Date, with the excess recorded as goodwill (in thousands):

 

 Schedule of Intangible Assets Acquired and Liabilities Assumed

   January 31, 
   2020 
Assets acquired:     
Cash and cash equivalents  $36 
Accounts receivable and other current assets   42 
Right-of-use assets, machinery and equipment   585 
Long-lived intangible assets - customer relationships   440 
Acquired in-process research and development   14,650 
      
Total identifiable assets acquired (a)   15,753 
      
Liabilities assumed:     
Accounts payable   61 
Right-of-use liabilities - operating lease   495 
Long-term deferred income tax liability   1,254 
      
Total identifiable liabilities assumed (b)   1,810 
      
Net assets acquired, excluding goodwill (a) - (b) = (c)   13,943 
      
Total cash, contingent consideration, and stock consideration transferred (d)   23,130 
      
Goodwill (d) - (c)   9,187 
Chronix Biomedica lInc [Member]  
Business Acquisition [Line Items]  
Schedule of Fair Value of Aggregate Merger Consideration
Cash consideration  $3,960 
      
Settlement of acquirer/acquiree activity pre-combination, net  $550 
      
Stock consideration     
Shares of Oncocyte common stock issued on the Merger Date   647,911 
Closing price per share of Oncocyte common stock on the Merger Date  $5.09 
Market value of Oncocyte common stock issued  $3,298 
      
Contingent Consideration  $42,295 
      
Total fair value of consideration transferred on the Merger Date  $50,103 
Schedule of Intangible Assets Acquired and Liabilities Assumed

Upon further review of the assets acquired and liabilities assumed, it was determined that the amount previously reported as assumed liabilities were not properly reflected. The following has been updated to reflect the assets acquired and liabilities as of the date of acquisition. The following table sets forth the allocation of the Aggregate Chronix Merger Consideration transferred to Chronix’s tangible and identifiable intangible assets acquired and liabilities assumed (in thousands):

 Schedule of Intangible Assets Acquired and Liabilities Assumed

   April 15, 2021 
Assets acquired:     
Cash and cash equivalents  $50 
Accounts receivable and other current assets   25 
Long-term assets   12 
Acquired in-process research and development   46,800 
      
Total identifiable assets acquired (a)   46,887 
      
Liabilities assumed:     
Deferred revenue   738 
Assumed liability   3,489 
Long-term deferred income tax liability   1,795 
      
Total identifiable liabilities assumed (b)   6,022 
      
Net assets acquired, excluding goodwill (a) - (b) = (c)   40,865
      
Total cash, contingent consideration, and stock consideration transferred (d)   50,103 
      
Goodwill (d) - (c)  $9,238