UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
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For the quarterly period ended
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SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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(Exact name of registrant as specified in its charter)
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TABULA RASA HEALTHCARE, INC.
QUARTERLY REPORT ON FORM 10-Q
For the period ended March 31, 2022
TABLE OF CONTENTS
2
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
TABULA RASA HEALTHCARE, INC.
UNAUDITED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)
March 31, | December 31, | |||||
| 2022 |
| 2021 | |||
Assets | ||||||
Current assets: | ||||||
Cash | $ | | $ | | ||
Restricted cash | | | ||||
Accounts receivable, net of allowance of $ | | | ||||
Inventories | | | ||||
Prepaid expenses | | | ||||
Client claims receivable | | | ||||
Other current assets | | | ||||
Current assets of discontinued operations | | | ||||
Total current assets | | | ||||
Property and equipment, net | | | ||||
Operating lease right-of-use assets | | | ||||
Software development costs, net | | | ||||
Goodwill | | | ||||
Intangible assets, net | | | ||||
Other assets | | | ||||
Noncurrent assets of discontinued operations | — | | ||||
Total assets | $ | | $ | | ||
Liabilities and stockholders’ equity | ||||||
Current liabilities: | ||||||
Current operating lease liabilities | $ | | $ | | ||
Accounts payable | | | ||||
Client claims payable | | | ||||
Accrued expenses and other liabilities | | | ||||
Current liabilities of discontinued operations | | | ||||
Total current liabilities | | | ||||
Line of credit | | | ||||
Long-term debt, net | | | ||||
Noncurrent operating lease liabilities | | | ||||
Deferred income tax liability, net | | | ||||
Other long-term liabilities | | | ||||
Noncurrent liabilities of discontinued operations | — | | ||||
Total liabilities | | | ||||
| ||||||
Commitments and contingencies (Note 15) | ||||||
Stockholders' equity: | ||||||
Preferred stock, $ | ||||||
Common stock, $ | | | ||||
Treasury stock, at cost; | ( | ( | ||||
Additional paid-in capital | | | ||||
Accumulated deficit | ( | ( | ||||
Total stockholders’ equity | | | ||||
Total liabilities and stockholders’ equity | $ | | $ | |
See accompanying notes to unaudited consolidated financial statements.
3
TABULA RASA HEALTHCARE, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share amounts)
Three Months Ended | |||||
March 31, | |||||
2022 |
| 2021 | |||
Revenue: | |||||
Product revenue | $ | | $ | | |
Service revenue | | | |||
Total revenue | | | |||
Cost of revenue, exclusive of depreciation and amortization shown below: | |||||
Product cost | | | |||
Service cost | | | |||
Total cost of revenue, exclusive of depreciation and amortization | | | |||
Operating expenses: | |||||
Research and development | | | |||
Sales and marketing | | | |||
General and administrative | | | |||
Long-lived asset impairment charge | | — | |||
Depreciation and amortization | | | |||
Total operating expenses | | | |||
Loss from operations | ( | ( | |||
Interest expense, net | | | |||
Loss from continuing operations before income taxes | ( | ( | |||
Income tax expense | | | |||
Net loss from continuing operations | ( | ( | |||
Net loss from discontinued operations, net of tax (Note 3) | ( | ( | |||
Net loss | $ | ( | $ | ( | |
Net loss per share: | |||||
Net loss per share from continuing operations, basic and diluted | ( | ( | |||
Net loss per share from discontinued operations, basic and diluted | ( | ( | |||
Total net loss per share, basic and diluted | ( | ( | |||
Weighted average common shares outstanding, basic and diluted | | |
See accompanying notes to unaudited consolidated financial statements.
4
TABULA RASA HEALTHCARE, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(In thousands, except share amounts)
Stockholders' Equity | |||||||||||||||||||
Three Months Ended March 31, 2022 | |||||||||||||||||||
Common Stock | Treasury Stock | Additional | Accumulated | Stockholders' | |||||||||||||||
| Shares |
| Amount | Shares |
| Amount |
| Paid-in Capital |
| Deficit |
| Equity | |||||||
Balance, January 1, 2022 | | $ | | ( | $ | ( | $ | | $ | ( | $ | | |||||||
Issuance of common stock awards | | — | — | — | — | — | — | ||||||||||||
Issuance of restricted stock | | — | — | — | — | — | — | ||||||||||||
Forfeitures of restricted shares | — | — | ( | — | — | — | — | ||||||||||||
Exercise of stock options, net of shares withheld | | — | — | — | | — | | ||||||||||||
Stock-based compensation expense | — | — | — | — | | — | | ||||||||||||
Net loss | — | — | — | — | — | ( | ( | ||||||||||||
Balance, March 31, 2022 | | $ | | ( | $ | ( | $ | | $ | ( | $ | |
Stockholders' Equity | |||||||||||||||||||
Three Months Ended March 31, 2021 | |||||||||||||||||||
Common Stock | Treasury Stock | Additional | Accumulated | Stockholders' | |||||||||||||||
Shares |
| Amount | Shares |
| Amount |
| Paid-in Capital |
| Deficit |
| Equity | ||||||||
Balance, January 1, 2021 | | $ | | ( | $ | ( | $ | | $ | ( | $ | | |||||||
Cumulative effect of change in accounting policy | — | — | — | — | ( | ( | ( | ||||||||||||
Issuance of common stock awards | | — | — | — | — | — | — | ||||||||||||
Issuance of restricted stock | | — | — | — | — | — | — | ||||||||||||
Forfeitures of restricted shares | — | — | ( | — | — | — | — | ||||||||||||
Exercise of stock options, net of shares withheld | | — | ( | ( | | — | | ||||||||||||
Stock-based compensation expense | — | — | — | — | | — | | ||||||||||||
Net loss | — | — | — | — | — | ( | ( | ||||||||||||
Balance, March 31, 2021 | | $ | | ( | $ | ( | $ | | $ | ( | $ | |
See accompanying notes to unaudited consolidated financial statements.
5
TABULA RASA HEALTHCARE, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Three Months Ended | ||||||
March 31, | ||||||
| 2022 |
| 2021 | |||
Cash flows from operating activities: | ||||||
Net loss | $ | ( | $ | ( | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||
Depreciation and amortization | | | ||||
Amortization of deferred financing costs and debt discount | | | ||||
Deferred taxes | | | ||||
Stock-based compensation | | | ||||
Acquisition-related contingent consideration paid | — | ( | ||||
Impairment charges | | — | ||||
Other noncash items | ( | — | ||||
Changes in operating assets and liabilities: | ||||||
Accounts receivable, net | ( | | ||||
Inventories | | | ||||
Prepaid expenses and other current assets | ( | ( | ||||
Client claims receivables | ( | ( | ||||
Other assets | ( | ( | ||||
Accounts payable | | ( | ||||
Accrued expenses and other liabilities | ( | | ||||
Client claims payables | | ( | ||||
Other long-term liabilities | | | ||||
Net cash used in operating activities | ( | ( | ||||
Cash flows from investing activities: | ||||||
Purchases of property and equipment | ( | ( | ||||
Software development costs | ( | ( | ||||
Net cash used in investing activities | ( | ( | ||||
Cash flows from financing activities: | ||||||
Proceeds from exercise of stock options | | | ||||
Payments for debt financing costs | ( | — | ||||
Borrowings on line of credit | | | ||||
Payment of acquisition-related notes payable | — | ( | ||||
Payments of acquisition-related contingent consideration | — | ( | ||||
Repayments of long-term debt and finance leases | — | ( | ||||
Net cash provided by financing activities | | | ||||
Net increase (decrease) in cash and restricted cash | | ( | ||||
Cash and restricted cash, beginning of period | | | ||||
Cash and restricted cash, end of period (1) | $ | | $ | | ||
Supplemental disclosure of cash flow information: | ||||||
Purchases of property and equipment and software development included in accounts payable and accrued expenses | $ | — | $ | | ||
Cash paid for interest | $ | | $ | | ||
Cash paid for taxes | $ | | $ | | ||
Interest costs capitalized to software development costs | $ | | $ | | ||
Reconciliation of cash and restricted cash: | ||||||
Cash | $ | | $ | | ||
Restricted cash | | | ||||
Cash from discontinued operations | | | ||||
Total cash and restricted cash | $ | | $ | |
(1) | The cash flows related to discontinued operations have not been segregated. Accordingly, the unaudited consolidated statements of cash flows include the results of continuing and discontinued operations. See Note 3 for discussion of discontinued operations. |
See accompanying notes to unaudited consolidated financial statements.
6
TABULA RASA HEALTHCARE, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share and per share data)
1. Nature of Business
Tabula Rasa HealthCare, Inc. (the “Company”) is a healthcare technology company advancing the safe use of medications by creating solutions designed to empower pharmacists, providers, and patients to optimize medication regimens. The Company’s advanced proprietary technology, MedWise®, identifies causes of and risks for medication-related problems, including adverse drug events, so healthcare professionals can minimize harm and reduce medication-related risks. The Company’s software and services help improve patient outcomes and lower healthcare costs through reduced hospitalizations, emergency department visits, and healthcare utilization. The Company serves a number of different organizations within the healthcare industry, including health plans, pharmacies, hospital sites, and at-risk provider groups, the majority of which are organizations with Programs of All-Inclusive Care for the Elderly (“PACE”).
2. Basis of Presentation, Summary of Significant Accounting Policies, and Recent Accounting Pronouncements
(a)Basis of Presentation
The accompanying unaudited consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. The unaudited interim consolidated financial statements have been prepared on the same basis as the annual audited consolidated financial statements and, in the opinion of management, reflect all adjustments (consisting of normal recurring accruals and adjustments) necessary to present fairly the Company’s interim consolidated financial position for the periods indicated. The interim results for the three months ended March 31, 2022 are not necessarily indicative of results to be expected for the year ending December 31, 2022, any other interim periods, or any future year or period. As such, the information included in this Quarterly Report on Form 10-Q should be read in conjunction with the audited consolidated financial statements and accompanying notes included in the Company’s annual report on Form 10-K filed with the SEC on February 25, 2022 (the “2021 Form 10-K”).
Except as described below, there have been no material changes to the Company’s significant accounting policies described in the 2021 Form 10-K that have a material impact on the Company’s accompanying unaudited consolidated financial statements and related notes.
(b)Assets and Liabilities Held for Sale and Discontinued Operations
A long-lived asset (or disposal group) is classified as held for sale if its carrying amount will be recovered principally through a sale transaction rather than through continuing use and a sale is considered highly probable within a year. A long-lived asset (or disposal group) classified as held for sale is initially measured at the lower of its carrying amount or fair value less costs to sell. An impairment loss is recognized for any initial or subsequent write-down of the long-lived asset (or disposal group) to fair value less costs to sell. A gain or loss not previously recognized by the date of the sale of the long-lived asset (or disposal group) is recognized at the date of derecognition.
Long-lived assets (including those that are part of a disposal group) are not depreciated or amortized while they are classified as held for sale. Long-lived assets classified as held for sale and the assets of a disposal group classified as held for sale are presented separately from the other assets in the balance sheet. The liabilities of a disposal group classified as held for sale are presented separately from other liabilities in the balance sheet.
Unless otherwise noted, amounts and disclosures throughout the notes to the unaudited consolidated financial statements relate to the Company’s continuing operations.
Additional details surrounding the Company’s assets and liabilities held for sale and discontinued operations are included in Note 3.
7
TABULA RASA HEALTHCARE, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share and per share data)
(c)Cloud Computing Arrangements
Costs to implement cloud computing arrangements that are hosted by third-party vendors are capitalized when incurred during the application development phase. Capitalized implementation costs are amortized on a straight-line basis over the reasonably certain term of the hosting arrangement, beginning when the service is ready for its intended use. As of March 31, 2022 and December 31, 2021, capitalized implementation costs of $
(d)Vendor Financing Arrangements
On February 24, 2022, the Company expanded its existing relationship with a third-party service provider for business process outsourcing and technology services for its third-party administration services and electronic health records solutions. As a result, the third-party provider hired approximately
The arrangement includes extended payment terms for cloud computing implementation costs, internally developed software support, and business process support. In order to determine the present value of the commitment, the Company used an imputed interest rate of
(e)Recent Accounting Pronouncements
In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2021-08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”). ASU 2021-08 requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities from acquired contracts using the revenue recognition guidance under ASC Topic 606 (Revenue from Contracts with Customers) in order to align the recognition of a contract liability with the definition of performance obligation. This approach differs from the current requirement to measure contract assets and contract liabilities acquired in a business combination at fair value. ASU 2021-08 is effective for financial statements issued for fiscal years beginning after December 15, 2022; early adoption is permitted. The Company is currently evaluating the potential impact of the adoption of this standard on the Company’s consolidated financial statements.
3. Discontinued Operations
In February 2022, the Company announced plans to evaluate non-core assets, refocus its corporate strategy, and increase stockholder value, and the Company commenced a plan to sell the DoseMe business, which the Company acquired in January 2019. In March 2022, the Company completed its evaluation of additional divestiture opportunities and commenced plans to sell the SinfoníaRx and PrescribeWellness businesses, which were acquired in September 2017 and March 2019, respectively. The Company considers the sales to be highly probable within
The DoseMe, SinfoníaRx, and PrescribeWellness businesses comprise the majority of the Company’s MedWise HealthCare segment. The Company’s plan of sale represents a strategic business shift having a significant effect on the Company’s operations and financial results. As a result, the Company determined that these businesses met the requirements to be classified as held for sale and discontinued operations as of March 31, 2022. Accordingly, unless otherwise indicated, the accompanying consolidated financial statements have been recast for all periods presented to reflect the assets, liabilities, revenue, and expenses related to these businesses as discontinued operations.
8
TABULA RASA HEALTHCARE, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share and per share data)
During the three months ended March 31, 2022, as a result of the Company’s intention to sell the aforementioned businesses, the Company prepared an impairment test on the related net assets held for sale. The Company concluded that the carrying value of the net assets held for sale for the DoseMe business did not exceed its fair value as determined using a market approach, less costs to sell. As a result, the Company recorded a goodwill impairment charge of $
The following table summarizes the results of operations of the DoseMe, SinfoníaRx, and PrescribeWellness businesses, which are included in loss from discontinued operations, net of tax in the consolidated statements of operations for the three months ended March 31, 2022 and 2021:
Three Months Ended | ||||||
March 31, | ||||||
| 2022 |
| 2021 | |||
Revenue | $ | | $ | | ||
Cost of revenue, exclusive of depreciation and amortization | | | ||||
Operating expenses | | | ||||
Impairment charges | | — | ||||
Loss from discontinued operations before income taxes | ( | ( | ||||
Income tax expense | | | ||||
Net loss from discontinued operations, net of tax | $ | ( | $ | ( |
9
TABULA RASA HEALTHCARE, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share and per share data)
The following table summarizes the current and noncurrent assets and liabilities classified as discontinued operations on the consolidated balance sheets as of March 31, 2022 and December 31, 2021:
March 31, | December 31, | ||||
2022 |
| 2021 | |||
Cash | $ | | $ | | |
Accounts receivable, net | | | |||
Prepaid expenses and other assets | | | |||
Property and equipment, net | | — | |||
Operating lease right-of-use assets | | — | |||
Software development costs, net | | — | |||
Goodwill | | — | |||
Intangible assets, net | | — | |||
Total current assets of discontinued operations | $ | | $ | | |
Property and equipment, net | $ | — | $ | | |
Operating lease right-of-use assets | — | | |||
Software development costs, net | — | | |||
Goodwill | — | | |||
Intangible assets, net | — | | |||
Other assets | — | | |||
Total noncurrent assets of discontinued operations | $ | — | $ | | |
Operating lease liabilities | $ | | $ | | |
Accounts payable | | | |||
Accrued expenses and other liabilities | | | |||
Total current liabilities of discontinued operations | $ | | $ | | |
Noncurrent operating lease liabilities | $ | — | $ | | |
Other long-term liabilities | — | | |||
Total noncurrent liabilities of discontinued operations | $ | — | $ | |
The following table summarizes the significant operating non-cash items and investing activities of discontinued operations:
Three Months Ended | ||||||
March 31, | ||||||
| 2022 |
| 2021 | |||
Depreciation and amortization | $ | | $ | | ||
Impairment charges | | — | ||||
Stock-based compensation | | | ||||
Purchases of property and equipment | ( | ( | ||||
Software development costs | ( | ( |
10
TABULA RASA HEALTHCARE, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share and per share data)
4. Revenue
The Company generates the majority of its revenue from its CareVention HealthCare segment.
Client contracts generally have a term of
The Company does not disclose the amount of variable consideration that the Company expects to recognize in future periods as the variable consideration in the Company’s contracts is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a single performance obligation, and the terms of that variable consideration relate specifically to the Company’s efforts to transfer the distinct service, or to a specific outcome from transferring the distinct service. The Company’s contracts primarily include monthly fees associated with unspecified quantities of medications, members, claims, medication safety reviews, or user subscriptions that fluctuate throughout the contract. See below for a description of the Company’s revenues.
CareVention HealthCare
PACE Product Revenue
The Company provides medication fulfillment pharmacy services to PACE organizations. While the majority of medications are routinely filled in order to treat chronic conditions, the mix and quantity of medications can vary. Revenue from medication fulfillment services is generally billed monthly or weekly, depending on whether the PACE organization is contracted with a pharmacy benefit manager, and recognized when medications are delivered and control has passed to the client. At the time of delivery, the Company has performed substantially all of its performance obligations under its client contracts. The Company does not experience a significant level of returns or reshipments.
PACE Solutions
The Company provides medication safety services and health plan management services to PACE organizations. These services primarily include medication reviews, risk adjustment services, third-party administration services, pharmacy benefit management (“PBM”) solutions, and electronic health records software. Revenue related to these services primarily consists of a fixed monthly fee assessed based on number of members served (“per member per month”), a fee for each claim adjudicated, and subscription fees. These fees are recognized when the Company satisfies its performance obligation to stand ready to provide PACE services, which occurs when the Company’s clients have access to the PACE services. The Company generally bills for PACE services on a monthly basis.
For client contracts for which the Company performs both medication fulfillment and PBM services, the Company recognizes revenue using the gross method at the contract price negotiated with its clients and when the Company has concluded it controls the prescription drug before it is transferred to the client plan members. The Company controls prescription drugs dispensed indirectly through its retail pharmacy network because it has separate contractual arrangements with those pharmacies, has discretion in setting the price for the transaction, and assumes primary responsibility for fulfilling the promise to provide prescription drugs to its client plan members while performing the related PBM services. These factors indicate that the Company is the principal and, as such, the Company recognizes the total prescription price contracted with clients in revenue.
11
TABULA RASA HEALTHCARE, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share and per share data)
MedWise HealthCare
Medication Safety Services
The Company provides medication safety services, which include identification of high-risk individuals, medication regimen reviews including patient and prescriber counseling, and targeted interventions to increase adherence and close gaps in care. Revenue related to these services primarily consists of per member per month fees and fees for each medication review and clinical assessment completed. Revenue is recognized when the Company satisfies its performance obligation to stand ready to provide medication safety services, which occurs when the Company’s clients have access to the medication safety services and when medication reviews and clinical assessments are completed. The Company generally bills for the medication reviews and clinical assessments when they are completed. The Company generally bills for the medication safety services on a monthly basis.
Software Subscription and Services
The Company provides software as a service (“SaaS”) solutions which allow for the identification of individuals with high medication-related risk and for optimizing medication therapy. Revenues related to these software services primarily consist of monthly subscription fees and are recognized monthly as the Company meets its performance obligation to provide access to the software. Revenue for implementation and set up services is generally recognized over the contract term as the software services are provided. The Company generally bills for the software services on a monthly basis.
Disaggregation of Revenue
In the following table, revenue is disaggregated by operating segment. Substantially all of the Company’s revenue is recognized in the U.S.
Three Months Ended | ||||||
March 31, | ||||||
2022 | 2021 | |||||
CareVention HealthCare: | ||||||
PACE product revenue | $ | | $ | | ||
PACE solutions | | | ||||
$ | | $ | | |||
MedWise HealthCare: | ||||||
Medication safety services | $ | | $ | | ||
Software subscription and services | | | ||||
$ | | $ | | |||
Total revenue | $ | | $ | |
12
TABULA RASA HEALTHCARE, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share and per share data)
Contract Balances
Assets and liabilities related to the Company’s contracts are reported on a contract-by-contract basis at the end of each reporting period. Contract balances consist of contract assets and contract liabilities. Contract assets are recorded when the right to consideration for services is conditional on something other than the passage of time. Contract assets relating to unbilled receivables are transferred to accounts receivable when the right to consideration becomes unconditional. Contract assets are classified as current or non-current based on the timing of the Company’s rights to the unconditional payments. Contract assets are generally classified as current and recorded within other current assets on the Company’s consolidated balance sheets.
Contract liabilities include advance customer payments and billings in excess of revenue recognized. The Company generally classifies contract liabilities in accrued expenses and other current liabilities and in other long-term liabilities on the Company’s consolidated balance sheets. The Company anticipates that it will satisfy most of its performance obligations associated with its contract liabilities within one year.
The following table provides information about the Company’s contract assets and contract liabilities from contracts with clients as of March 31, 2022 and December 31, 2021.
March 31, | December 31, | |||||
2022 |
| 2021 | ||||
Contract assets | $ | | $ | | ||
Contract liabilities | | |
Significant changes in the contract assets and the contract liabilities balances during the period are as follows:
March 31, | |||
2022 | |||
Contract assets: | |||
Contract assets, beginning of period | $ | | |
Decreases due to cash received | ( | ||
Changes to the contract assets at the beginning of the period as a result of changes in estimates | | ||
Changes during the year, net of reclassifications to receivables | | ||
Contract assets, end of period | $ | | |
Contract liabilities: | |||
Contract liabilities, beginning of period | $ | | |
Revenue recognized that was included in the contract liabilities balance at the beginning of the period | ( | ||
Increases due to cash received, excluding amounts recognized as revenue during the year | | ||
Contract liabilities, end of period | $ | |
During the three months ended March 31, 2021, the Company recognized $
13
TABULA RASA HEALTHCARE, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share and per share data)
5. Net Loss per Share
Basic and diluted net loss per share is computed by dividing net loss by the weighted average number of shares of common stock of the Company outstanding during the period.
The following table presents the calculation of basic and diluted net loss per share for the Company’s common stock:
Three Months Ended | ||||||
March 31, | ||||||
| 2022 |
| 2021 | |||
Numerator (basic and diluted): | ||||||
Net loss from continuing operations | ( | ( | ||||
Net loss from discontinued operations | ( | ( | ||||
Net loss | ( | ( | ||||
Denominator (basic and diluted): | ||||||
Weighted average shares of common stock outstanding, basic and diluted | | | ||||
Net loss per share from continuing operations, basic and diluted | ( | ( | ||||
Net loss per share from discontinued operations, basic and diluted | ( | ( | ||||
Total net loss per share, basic and diluted | ( | ( |
The following potential common shares, presented based on amounts outstanding as of March 31, 2022 and 2021 were excluded from the calculation of diluted net loss per share for the periods indicated because including them would have had an anti-dilutive effect.
Three Months Ended | ||||
March 31, | ||||
| 2022 |
| 2021 | |
Stock options to purchase common stock | | | ||
Unvested restricted stock and restricted stock units | | | ||
Common stock warrants | | | ||
Conversion of convertible senior subordinated notes | | | ||
| |
For the three months ended March 31, 2022 and 2021, shares related to the conversion of the convertible senior subordinated notes were included in the table above under the if-converted method.
For the period ended March 31, 2022, shares related to the performance stock units were excluded from the table above as the performance conditions were unmet as of March 31, 2022 (see Note 13).
14
TABULA RASA HEALTHCARE, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share and per share data)
6. Other Current Assets
As of March 31, 2022 and December 31, 2021, other current assets consisted of the following:
March 31, 2022 |
| December 31, 2021 | ||||
Contract assets | $ | | $ | | ||
Non-trade receivables | | | ||||
Other | | | ||||
Total other current assets | $ | | $ | |
7. Property and Equipment
Accumulated depreciation was $
8. Software Development Costs
The Company capitalizes certain costs incurred in connection with obtaining or developing its proprietary software platforms, which are used to support its product and service contracts. These costs include third-party contractors and payroll for employees directly involved with the software development, including external direct costs of material and services, and interest expense related to the borrowings attributable to software development. As of March 31, 2022 and December 31, 2021, capitalized software costs consisted of the following:
March 31, 2022 |
| December 31, 2021 | |||
Software development costs | $ | | $ | | |
Less: accumulated amortization | ( | ( | |||
Software development costs, net | $ | | $ | | |
Capitalized software development costs included above not yet subject to amortization | $ | | $ | |
Amortization expense for the three months ended March 31, 2022 and 2021 was $
During the first quarter of 2022, the Company became aware of changes in circumstances impacting the future functionality of certain capitalized software development costs and evaluated the recoverability of the related long-lived assets by comparing their carrying amount to the future net undiscounted cash flows expected to be generated by the assets to determine if the carrying value was not recoverable. The recoverability test indicated that certain capitalized software development costs were impaired and, as a result, the Company used an income approach to measure the fair value of the assets and recognized non-cash impairment charges of $
9. Goodwill and Intangible Assets
The Company’s goodwill as of March 31, 2022 and December 31, 2021 was $
During the first quarter of 2022, the Company experienced a sustained decline in the market price of its common stock and determined that an indicator of impairment was present. The Company performed a quantitative goodwill impairment assessment as of March 31, 2022, estimating the fair value of the Company’s reporting unit using a market approach. Based on the analysis performed, the Company determined that the estimated fair value of the Company’s reporting unit exceeded its carrying value, and, as a result, goodwill was not impaired as of March 31, 2022.
15
TABULA RASA HEALTHCARE, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share and per share data)
Intangible assets consisted of the following as of March 31, 2022 and December 31, 2021:
Weighted Average | |||||||||||
Amortization Period | Accumulated | Intangible | |||||||||
| (in years) |
| Gross Value |
| Amortization |
| Assets, net | ||||
March 31, 2022 | |||||||||||
Trade names | $ | | $ | ( | $ | | |||||
Client relationships | | ( | | ||||||||
Non-competition agreements | | ( | | ||||||||
Developed technology | | ( | | ||||||||
Domain name | | ( | | ||||||||
Total intangible assets | $ | | $ | ( | $ | |
Weighted Average | |||||||||||
Amortization Period | Accumulated | Intangible | |||||||||
| (in years) |
| Gross Value |
| Amortization |
| Assets, net | ||||
December 31, 2021 | |||||||||||
Trade names | $ | | $ | ( | $ | | |||||
Client relationships | | ( | | ||||||||
Non-competition agreements | | ( | | ||||||||
Developed technology | | ( |