(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of April ~~26, 2021,~~21, 2022, there were approximately ~~104,292,460~~102,575,027 shares of the registrant’s common stock outstanding.

	Three Months Ended March 31,						Three Months Ended March 31,
	2021			2020			2022			2021
	(in thousands, except per share data)						(in thousands, except per share data)
Revenue	$	1,208,745		$	1,163,355		$	1,336,253		$	1,208,745

Costs and operating expenses:
Direct costs (exclusive of depreciation and amortization)		945,250			924,014			1,044,432			945,250
Selling, general, and administrative expenses		137,314			125,547			140,166			137,314
Restructuring and other costs		7,228			8,720			15,557			7,228
Depreciation		18,447			17,225			20,579			18,447
Amortization		39,491			38,882			41,623			39,491
Total operating expenses		1,147,730			1,114,388			1,262,357			1,147,730
Income from operations		61,015			48,967			73,896			61,015

Total other expense, net:
Interest income		(71	)		(336	)		(3	)		(71	)
Interest expense		23,328			26,458			15,765			23,328
Loss on extinguishment of debt		603			—			—			603
Other income, net		(9,856	)		(18,930	)
Other expense (income), net								4,642			(9,856	)
Total other expense, net		14,004			7,192			20,404			14,004
Income before provision for income taxes		47,011			41,775			53,492			47,011
Income tax expense		8,287			8,201			7,316			8,287
Net income	$	38,724		$	33,574		$	46,176		$	38,724

Earnings per share:
Basic	$	0.37		$	0.32		$	0.45		$	0.37
Diluted	$	0.37		$	0.32		$	0.44		$	0.37
Weighted average common shares outstanding:
Basic		104,274			104,265			103,665			104,274
Diluted		105,457			105,642			104,410			105,457

The accompanying notes are an integral part of these condensed consolidated financial statements.

	March 31, 2021			December 31, 2020			March 31, 2022			December 31, 2021
	(in thousands, except par value)						(in thousands, except par value)
ASSETS
Current assets:
Cash, cash equivalents, and restricted cash	$	264,689		$	272,173		$	119,151		$	106,475
Accounts receivable and unbilled services, net		1,299,168			1,344,781			1,596,315			1,524,890
Prepaid expenses and other current assets		110,521			121,058			160,792			135,091
Total current assets		1,674,378			1,738,012			1,876,258			1,766,456
Property and equipment, net		202,618			216,200			240,015			222,657
Operating lease right-of-use assets		215,048			223,285			201,407			209,408
Goodwill		4,780,179			4,776,178			4,942,727			4,956,015
Intangible assets, net		896,386			933,525			808,931			854,067
Deferred income tax assets		34,964			35,059			34,788			35,387
Other long-term assets		151,076			141,047			199,835			193,103
Total assets	$	7,954,649		$	8,063,306		$	8,303,961		$	8,237,093

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	113,881		$	113,684		$	108,315		$	107,535
Accrued expenses		587,757			611,042			657,084			614,441
Deferred revenue		773,025			793,068			891,750			868,455
Current portion of operating lease obligations		40,759			42,082			43,234			43,058
Current portion of finance lease obligations		16,863			17,455			21,998			20,627
Total current liabilities		1,532,285			1,577,331			1,722,381			1,654,116
Long-term debt		2,862,574			2,902,054			2,906,270			2,775,721
Operating lease long-term obligations		213,662			221,760			195,557			205,798
Finance lease long-term obligations		27,768			31,522			40,162			34,181
Deferred income tax liabilities		17,043			20,216			78,609			78,062
Other long-term liabilities		64,440			68,311			59,423			76,660
Total liabilities		4,717,772			4,821,194			5,002,402			4,824,538

Commitments and contingencies (Note 16)

Shareholders’ equity:
Preferred stock, $0.01 par value; 30,000 shares authorized, 0 shares issued and outstanding at March 31, 2021 and December 31, 2020		0			0
Common stock, $0.01 par value; 600,000 shares authorized, 104,226 and 103,935 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively		1,042			1,039
Preferred stock, $0.01 par value; 30,000 shares authorized, 0 shares issued and outstanding as of March 31, 2022 and December 31, 2021								—			0
Common stock, $0.01 par value; 600,000 shares authorized, 102,558 and 103,764 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively								1,026			1,038
Additional paid-in capital		3,440,840			3,461,747			3,410,524			3,474,088
Accumulated other comprehensive loss, net of taxes		(39,174	)		(40,801	)		(57,364	)		(49,618	)
Accumulated deficit		(165,831	)		(179,873	)		(52,627	)		(12,953	)
Total shareholders’ equity		3,236,877			3,242,112			3,301,559			3,412,555
Total liabilities and shareholders’ equity	$	7,954,649		$	8,063,306		$	8,303,961		$	8,237,093

The accompanying notes are an integral part of these condensed consolidated financial statements.

	Three Months Ended March 31,						Three Months Ended March 31,
	2021			2020			2022			2021
	(in thousands)						(in thousands)
Cash flows from operating activities:
Net income	$	38,724		$	33,574		$	46,176		$	38,724
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		57,938			56,107			62,202			57,938
Share-based compensation		17,353			15,998			17,333			17,353
(Recovery from) provision for doubtful accounts		(187	)		271
(Benefit from) provision for deferred income taxes		(4,653	)		8,159
Foreign currency transaction gains		(9,522	)		(15,019	)
Recovery from doubtful accounts								(108	)		(187	)
Provision for (benefit from) deferred income taxes								1,000			(4,653	)
Foreign currency transaction adjustments								434			(9,522	)
Fair value adjustment of contingent obligations		(597	)		(4,095	)		—			(597	)
Loss on extinguishment of debt		603			0			—			603
Other non-cash items		953			1,104			(1,945	)		953
Changes in operating assets and liabilities, net of effect of business combinations:
Changes in operating assets and liabilities, net of effect of acquisitions:
Accounts receivable, unbilled services, and deferred revenue		30,997			(53,078	)		(49,905	)		30,997
Accounts payable and accrued expenses		518			(66,426	)		39,650			518
Other assets and liabilities		(5,039	)		(15,202	)		(43,950	)		(5,039	)
Net cash provided by (used in) operating activities		127,088			(38,607	)
Net cash provided by operating activities								70,887			127,088
Cash flows from investing activities:
Payments related to acquisition of business, net of cash acquired		(9,982	)		0
Payments related to acquisitions of businesses, net of cash acquired								(1,727	)		(9,982	)
Purchases of property and equipment		(11,173	)		(11,870	)		(23,474	)		(11,173	)
Proceeds from (investments in) unconsolidated affiliates		1,374			(6,750	)
(Investments in) proceeds from unconsolidated affiliates								(296	)		1,374
Net cash used in investing activities		(19,781	)		(18,620	)		(25,497	)		(19,781	)
Cash flows from financing activities:
Payments of debt financing costs		(49	)		0			—			(49	)
Repayments of long-term debt		(105,856	)		0			—			(105,856	)
Proceeds from accounts receivable financing agreement		65,000			6,600			—			65,000
Repayments of accounts receivable financing agreement		0			(6,600	)
Proceeds from revolving line of credit		0			300,000			130,000			—
Payments of contingent consideration related to business combinations		(6,196	)		(26,592	)
Payments of contingent consideration related to acquisitions								—			(6,196	)
Payments of finance leases		(4,269	)		(4,674	)		(2,193	)		(4,269	)
Payments for repurchases of common stock		(44,505	)		(32,029	)		(149,961	)		(44,505	)
Proceeds from exercises of stock options		10,804			12,358			11,483			10,804
Payments related to tax withholdings for share-based compensation		(26,295	)		(19,145	)		(25,901	)		(26,295	)
Net cash (used in) provided by financing activities		(111,366	)		229,918
Net cash used in financing activities								(36,572	)		(111,366	)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash		(3,425	)		(420	)		3,858			(3,425	)
Net change in cash, cash equivalents, and restricted cash		(7,484	)		172,271			12,676			(7,484	)
Cash, cash equivalents, and restricted cash - beginning of period		272,173			163,689			106,475			272,173
Cash, cash equivalents, and restricted cash - end of period	$	264,689		$	335,960		$	119,151		$	264,689

The accompanying notes are an integral part of these condensed consolidated financial statements.

	Three Months Ended March 31,						Three Months Ended March 31,
	2021			2020			2022			2021
	(in thousands)						(in thousands)
Shareholders’ equity, beginning balance	$	3,242,112		$	3,029,654		$	3,412,555		$	3,242,112
Impact from adoption of ASU 2016-13		—			(2,771	)
Shareholders’ equity, adjusted beginning balance		3,242,112			3,026,883

Common stock:
Beginning balance		1,039			1,039			1,038			1,039
Repurchases of common stock		(6	)		(6	)		(19	)		(6	)
Issuances of common stock		9			9			7			9
Ending balance		1,042			1,042			1,026			1,042

Additional paid-in capital:
Beginning balance		3,461,747			3,441,471			3,474,088			3,461,747
Repurchases of common stock		(19,817	)		(19,734	)		(64,092	)		(19,817	)
Issuances of common stock		(18,443	)		(6,995	)		(16,805	)		(18,443	)
Share-based compensation		17,353			15,998			17,333			17,353
Ending balance		3,440,840			3,430,740			3,410,524			3,440,840

Accumulated other comprehensive loss:
Beginning balance		(40,801	)		(71,593	)		(49,618	)		(40,801	)
Unrealized gain (loss) on derivative instruments, net of taxes		5,937			(10,730	)
Unrealized gain on derivative instruments, net of taxes								9,640			5,937
Foreign currency translation adjustment, net of taxes		(4,310	)		(48,788	)		(17,386	)		(4,310	)
Ending balance		(39,174	)		(131,111	)		(57,364	)		(39,174	)

Accumulated deficit:
Beginning balance		(179,873	)		(341,263	)		(12,953	)		(179,873	)
Impact from adoption of ASU 2016-13		—			(2,771	)
Adjusted beginning balance		(179,873	)		(344,034	)
Repurchases of common stock		(24,682	)		(12,289	)		(85,850	)		(24,682	)
Net income		38,724			33,574			46,176			38,724
Ending balance		(165,831	)		(322,749	)		(52,627	)		(165,831	)

Shareholders’ equity, ending balance	$	3,236,877		$	2,977,922		$	3,301,559		$	3,236,877

The accompanying notes are an integral part of these condensed consolidated financial statements.

Syneos Health, Inc. (the “Company”) is a global provider of end-to-end biopharmaceutical outsourcing solutions. The Company operates under 2 reportable segments, Clinical Solutions and Commercial Solutions, and derives its revenue through a suite of services designed to enhance its customers’ ability to successfully develop, launch, and market their products. The Company offers its solutions on both a standalone and integrated basis with biopharmaceutical development and commercialization services ranging from Phase I to IV clinical trial services to services associated with the commercialization of biopharmaceutical products. The Company’s customers include small, mid-sized, and large companies in the pharmaceutical, biotechnology, and medical device industries.

The Company prepared the accompanying unaudited condensed consolidated financial statements in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information. The significant accounting policies followed by the Company for interim financial reporting are consistent with the accounting policies followed for annual financial reporting.

The unaudited condensed consolidated financial statements, in management’s opinion, include all adjustments of a normal recurring nature necessary for a fair presentation. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020,~~2021 (the “2021 Form 10-K”), filed with the Securities and Exchange Commission on February ~~18, 2021.~~17, 2022. The results of operations for the three months ended March 31, ~~2021~~2022 are not necessarily indicative of the results to be expected for the full year ending December 31, ~~2021~~2022 or any other future period. The unaudited condensed consolidated balance sheet atas of December 31, ~~2020~~2021 is derived from the amounts in the audited consolidated balance sheet included in the ~~Company’s Annual Report on~~2021 Form ~~10-K for the year ended December 31, 2020.~~10-K.

Certain previously reported amounts have been reclassified to conform to the current year presentation.

~~On March 11, 2020, the World Health Organization designated the outbreak of the novel strain of coronavirus that causes the disease known as~~The ongoing COVID-19 as a global pandemic. Governments and businesses around the world have taken unprecedented actions to mitigate the spread of COVID-19, including, but not limited to, shelter-in-place orders, quarantines, significant restrictions on travel, social distancing practices as well as restrictions that prohibit many employees from going to work in person. As a result, the Company experienced significant impacts to its business and results of operations from COVID-19 during 2020 and for the three months ended March 31, 2021. While certain governments have eased restrictions, the pandemic continues to be disruptive to the Company’s business. The pandemic and associated economic ~~impacts~~repercussions have significantly impacted, and are expected to continue to ~~significantly~~ impact, the Company’s ~~future financial condition,~~business and operations. The continued availability and effectiveness of vaccines may partially mitigate the risks around the continued spread of COVID-19, however, with the spread of COVID-19 variants, the ongoing impacts of the COVID-19 pandemic could adversely impact the Company’s business and results of ~~operations, and cash flows.~~operations. For further discussion of the potential impact of the pandemic on its business, refer to Part I, Item 1A, “Risk Factors” in the 2021 Form 10-K.

Certain of the Company’s subsidiaries participate in a notional cash pooling arrangement to manage global liquidity requirements. As part of a master netting arrangement, the participants combine their cash balances in pooling accounts at the same financial institution with the ability to offset bank overdrafts of one participant against positive cash account balances held by another participant. Under the terms of the master netting arrangement, the financial institution has the right, ability, and intent to offset a positive balance in one account against an overdrawn amount in another account. Amounts in each of the accounts are unencumbered and unrestricted with respect to use. As such, the net cash balance related to this pooling arrangement is included in cash, cash equivalents, and restricted cash in the ~~unaudited~~ condensed consolidated balance sheets.

The Company’s net cash pool position consisted of the following (in thousands):

	March 31, 2021			December 31, 2020			March 31, 2022			December 31, 2021
Gross cash position	$	193,053		$	220,261		$	149,819		$	179,160
Less: cash borrowings		(178,715	)		(204,647	)		(146,677	)		(167,507	)
Net cash position	$	14,338		$	15,614		$	3,142		$	11,653

Accounts receivable and unbilled services (including contract assets), net of allowance for doubtful accounts, consisted of the following (in thousands):

	March 31, 2021			December 31, 2020			March 31, 2022			December 31, 2021
Accounts receivable billed	$	705,783		$	774,605		$	918,248		$	873,265
Accounts receivable unbilled		228,798			211,285			251,194			241,799
Contract assets		372,266			366,506			434,320			417,411
Less: Allowance for doubtful accounts		(7,679	)		(7,615	)		(7,447	)		(7,585	)
Accounts receivable and unbilled services, net	$	1,299,168		$	1,344,781		$	1,596,315		$	1,524,890

The Company has an accounts receivable factoring agreement to sell certain eligible unsecured trade accounts receivable, at its option, without recourse, to an unrelated third-party financial institution for cash. For the three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, the Company factored ~~$30.1~~$34.1 million and ~~$36.2~~$30.1 million, respectively, of trade accounts receivable on a non-recourse basis and received ~~$30.0~~$34.0 million and ~~$36.0~~$30.0 million, respectively, in cash proceeds from the sale. The fees associated with these transactions were insignificant.

The changes in the carrying amount of goodwill by segment for the three months ended March 31, ~~2021~~2022 were as follows (in thousands):

Clinical
Solutions (a)

Commercial
Solutions (b)

Total

Balance as of December 31, 2020

$
3,216,335

$
1,559,843

$
4,776,178

Business combinations (c)

2,479

—

2,479

Impact of foreign currency translation and other (d)

49,079

(47,557
)

1,522

Balance as of March 31, 2021

$
3,267,893

$
1,512,286

$
4,780,179

	Clinical Solutions (a)			Commercial Solutions (a)			Total
Balance as of December 31, 2021	$	3,448,699		$	1,507,316		$	4,956,015
Acquisitions (b)		1,879			—			1,879
Impact of foreign currency translation		(9,284	)		(5,883	)		(15,167	)
Balance as of March 31, 2022	$	3,441,294		$	1,501,433		$	4,942,727

(a) Accumulated impairment losses of $8.1 million associated with the Clinical Solutions segment were recorded prior to 2016 and related to the former Phase I Services segment, now a component of the Clinical Solutions segment. NaN impairment of goodwill was recorded for the three months ended March 31, ~~2021.~~2022.

(b) ~~Accumulated impairment losses of $8.0 million associated~~Amount represents goodwill recognized in connection with ~~the Commercial Solutions segment were recorded prior to 2015~~an insignificant acquisition and ~~related to the former Global Consulting segment, now a component of the Commercial Solutions segment. NaN impairment of goodwill was recorded for~~measurement period adjustments in connection with insignificant 2021 acquisitions during the three months ended March 31, ~~2021.~~

(c) Amount represents measurement period adjustments to goodwill recognized in connection with the 2020 acquisitions of SHCR Holdings Corporation (“Synteract”) and Illingworth Research Group™ (“Illingworth Research”) 2022 within the Clinical Solutions ~~segment.~~

~~(d) Includes $44.2 million reallocation of goodwill from the Commercial Solutions~~ segment ~~to the Clinical Solutions segment to reflect the transfer of the Kinapse Regulatory and Operations Consulting service lines to align with management reporting in 2021.~~.

Accumulated other comprehensive loss, net of taxes, consisted of the following (in thousands):

	Three Months Ended March 31,						Three Months Ended March 31,
	2021			2020			2022			2021
Beginning balance	$	(40,801	)	$	(71,593	)	$	(49,618	)	$	(40,801	)

Derivative instruments:
Beginning balance								(2,621	)		(18,761	)
Other comprehensive income before reclassifications								8,612			772
Reclassification adjustments								1,028			5,165
Ending balance								7,019			(12,824	)

Foreign currency translation:
Beginning balance		(22,040	)		(56,757	)		(46,997	)		(22,040	)
Other comprehensive loss before reclassifications		(4,310	)		(48,788	)		(17,386	)		(4,310	)
Ending balance		(26,350	)		(105,545	)		(64,383	)		(26,350	)

Derivative instruments:
Beginning balance		(18,761	)		(14,836	)
Other comprehensive income (loss) before reclassifications		772			(12,510	)
Reclassification adjustments		5,165			1,780
Ending balance		(12,824	)		(25,566	)

Accumulated other comprehensive loss, net of taxes	$	(39,174	)	$	(131,111	)	$	(57,364	)	$	(39,174	)

Changes in accumulated other comprehensive loss consisted of the following (in thousands):

	Three Months Ended March 31,						Three Months Ended March 31,
							2022			2021
Unrealized gain on derivative instruments:
Unrealized gain during period, before taxes							$	11,667		$	1,034
Income tax expense								3,055			262
Unrealized gain during period, net of taxes								8,612			772
Reclassification adjustment, before taxes								1,393			6,916
Income tax expense								365			1,751
Reclassification adjustment, net of taxes								1,028			5,165
Total unrealized gain on derivative instruments, net of taxes								9,640			5,937
	2021			2020
Foreign currency translation adjustments:
Foreign currency translation adjustment, before taxes	$	(5,018	)	$	(48,788	)		(20,097	)		(5,018	)
Income tax benefit		(708	)		—			(2,711	)		(708	)
Foreign currency translation adjustments, net of taxes		(4,310	)		(48,788	)		(17,386	)		(4,310	)
Unrealized loss on derivative instruments:
Unrealized gain (loss) during period, before taxes		1,034			(19,783	)
Income tax expense (benefit)		262			(7,273	)
Unrealized gain (loss) during period, net of taxes		772			(12,510	)
Reclassification adjustment, before taxes		6,916			2,414
Income tax expense		1,751			634
Reclassification adjustment, net of taxes		5,165			1,780
Total unrealized gain (loss) on derivative instruments, net of taxes		5,937			(10,730	)
Total other comprehensive income (loss), net of taxes	$	1,627		$	(59,518	)

Total other comprehensive (loss) income, net of taxes							$	(7,746	)	$	1,627

Other ~~income,~~expense (income), net consisted of the following (in thousands):

~~On December 9,~~During 2020, the Company ~~completed~~made a non-cash investment of $27.3 million to acquire certain intellectual property rights from a customer in lieu of cash payment for services rendered. The Company subsequently exchanged the ~~acquisition of Synteract, effected through~~intellectual property for an equity method investment in an unconsolidated variable interest entity. The Company provided the ~~purchase of 100% of the outstanding shares of Synteract for approximately $385.5~~entity $3.8 million in cash, ~~(net~~in the form of ~~approximately $28.0~~a loan, during the third quarter of 2021. Based on the hypothetical liquidation book value of its investment as of March 31, 2022, the Company recorded a $1.2 million loss to other expense (income), net in the accompanying condensed consolidated statement of ~~cash acquired), which includes payment of $1.0 million during~~income for the three months ended March 31, ~~2021. Synteract is a contract research organization focused on~~2022. As of March 31, 2022, the ~~emerging biopharmaceutical industry, strengthening~~book value of the Company’s ~~position~~investment was $14.4 million and was included in other long-term assets in the ~~small~~accompanying condensed consolidated balance sheet, with a maximum exposure to ~~mid-sized category. The Company recognized $357.1~~loss of approximately $18.3 million, ~~of goodwill and $56.4 million of intangible assets, including acquired backlog and trade name, as a result~~which includes funding of the acquisition. The purchase price has been allocated to the tangible assets and identifiable intangible assets acquired and liabilities assumed based upon their fair values. The excess of the purchase price over the tangible and intangible assets acquired and liabilities assumed has been recorded as goodwill. Goodwill is attributable to the acquired workforce as well as future synergies and is not deductible for income tax purposes. The operating results from the acquisition of Synteract have been included in the Company’s Clinical Solutions segment from the date of acquisition.

On December 17, 2020, the Company completed the acquisition of Illingworth Research, a leading provider of clinical research home health services, adding new scale and capabilities to the Company’s clinical trial solutions. The total purchase consideration was $80.9 million (net of cash acquired of $1.1 million), which includes payments of $9.0 million during the three months ended March 31, 2021. The Company recognized $64.0 million of goodwill and $21.5 million of intangible assets, principally customer relationships, as a result of the acquisition. The purchase price has been allocated to the tangible assets and identifiable intangible assets acquired and liabilities assumed based upon their fair values. The excess of the purchase price over the tangible and intangible assets acquired and liabilities assumed has been recorded as goodwill. Goodwill is attributable to the acquired workforce as well as future synergies and is not deductible for income tax purposes. The operating results from the acquisition of Illingworth Research have been included in the Company’s Clinical Solutions segment from the date of acquisition.

The Company’s assessment of fair value and the purchase price allocation related to these 2020 acquisitions is preliminary and further adjustments may be necessary as additional information related to the fair values of assets acquired and liabilities assumed is assessed during the measurement period (up to one year from the respective acquisition dates).

Pro forma information for these acquisitions is not presented as the operations of the acquired businesses, individually and in the aggregate, are not significant to the overall operations of the Company.loan.

	March 31, 2021			December 31, 2020			March 31, 2022			December 31, 2021
Secured Debt
Term Loan A - tranche one due March 2024	$	173,852		$	183,715		$	149,195		$	149,195
Term Loan A - tranche two due August 2024		1,242,140			1,273,991			1,636,797			1,636,797
Term Loan B due August 2024		496,421			560,564
Accounts receivable financing agreement due October 2022		365,000			300,000
Revolving credit facility due August 2024								130,000			—
Accounts receivable financing agreement due October 2024								400,000			400,000
Total secured debt		2,277,413			2,318,270			2,315,992			2,185,992
Unsecured Debt
3.625% Senior Unsecured Notes due 2029 (the “Notes”)		600,000			600,000
Senior notes due January 2029 (the “Notes”)								600,000			600,000
Total debt obligations		2,877,413			2,918,270			2,915,992			2,785,992
Less: Term loan original issuance discount		(3,108	)		(3,500	)		(2,021	)		(2,228	)
Less: Unamortized deferred issuance costs		(11,731	)		(12,716	)		(7,701	)		(8,043	)
Total debt obligations, non-current portion	$	2,862,574		$	2,902,054
Total long-term debt							$	2,906,270		$	2,775,721

The Company is party to a credit agreement (as amended, the “Credit Agreement”) that includes a ~~$1.55 billion~~ Term Loan A facility (“Term Loan A”) that has two tranches ~~tranche one that matures on March 26, 2024 and tranche two that matures on August 1, 2024~~(as detailed in the table above),~~, a $1.60 billion Term Loan B facility that matures on August 1, 2024 (“Term Loan B”),~~ and a $600.0 million revolving credit facility that matures on August 1, 2024 (the “Revolver”).

In February 2021, as a result of the Company’s First Lien Leverage Ratio (as defined in the Credit Agreement) being less than or equal to 2.5x, the Adjusted Eurocurrency Rate Spread (as defined in the Credit Agreement) on Term Loan A and the Revolver decreased from 1.50% to 1.25%.

During the three months ended March 31, 2021, the Company made $41.8 million and $64.1 million of voluntary prepayments against Term Loan A and Term Loan B, respectively, which were applied to future principal payments. As a result of ~~these and~~ previous voluntary prepayments, the Company is not required to make a mandatory payment against the principal balance of Term Loan A until October 2023. As of March 31, 2022, ~~and~~ the interest rate on Term Loan ~~B until maturity in August 2024.~~A was 1.70%.

The Revolver includes letters of credit (“LOCs”) with a sublimit of $150.0 million. As of March 31, ~~2021,~~2022, there were 0$130.0 million of outstanding Revolver borrowings and ~~$16.1~~$14.2 million of LOCs outstanding, leaving ~~$583.9~~$455.8 million of available borrowings under the Revolver, including ~~$133.9~~$135.8 million available for LOCs.

The lease for the Company’s corporate headquarters in Morrisville, North Carolina includes a provision that may require the Company to issue a LOC in certain amounts to the landlord based on the debt rating of the Company issued by Moody’s Investors Service (or other nationally-recognized debt rating agency, such as S&P Global Ratings). As of March 31, ~~2021 (and through~~2022, the date of this filing), the Company’s debt rating was such that no LOC is currently required. Any LOC issued in accordance with the aforementioned requirements could be issued under the Company’s Revolver, and, if issued underweighted average interest rate on the Revolver ~~would reduce its available borrowing capacity by the same amount accordingly.~~was 1.85%.

The Company has an accounts receivable financing agreement (as amended) with a termination date of October ~~3, 2022,~~2024, unless terminated earlier pursuant to its terms. On January 28, 2021, the Company amended this agreement to increase the amount it can borrow from $300.0 million to $365.0 million, and drew down the additional $65.0 million to partially fund the Term Loan A and Term Loan B voluntary prepayments. ~~Accordingly, there was no incremental impact on the Company’s total debt.~~

Under the accounts receivable financing agreement, certain of the Company’s consolidated subsidiaries sell accounts receivable and unbilled services (including contract assets) balances to a wholly-owned, bankruptcy-remote special purpose entity. The Company has guaranteed the performance of the obligations of existing and future subsidiaries that sell and service the accounts receivable under this agreement. The available borrowing capacity varies monthly according to the levels of the Company’s eligible accounts receivable and unbilled services (including contract assets). Loans under this agreement will accrue interest at a reserve-adjusted LIBOR rate or a base rate equal to the higher of the applicable lender’s prime rate and the federal funds rate plus 0.50%.

As of March 31, ~~2021,~~2022, the Company had ~~$365.0~~$400.0 million of outstanding borrowings under ~~the accounts receivable financing~~this agreement, which are recorded in long-term debt on the accompanying ~~unaudited~~ condensed consolidated balance sheet. There was 0 remaining borrowing capacity available under this agreement as of March 31, ~~2021.~~2022. As of March 31, 2022, the interest rate on the accounts receivable financing agreement was 1.40%.

As of March 31, ~~2021,~~2022, the contractual maturities of the Company’s debt obligations (excluding finance leases) were as follows (in thousands):

	Principal			Principal
Remainder of 2021	$	—
2022		385,856
Remainder of 2022				$	—
2023		107,313			21,732
2024		1,784,244			2,294,260
2025		—			—
2026 and thereafter		600,000
Less: Deferred issuance costs		(11,731	)
2026					—
2027 and thereafter					600,000
Less: Term loan original issuance discount		(3,108	)		(2,021	)
Less: Unamortized deferred issuance costs					(7,701	)
Total	$	2,862,574		$	2,906,270

The Company has entered into various interest rate swaps to mitigate its exposure to changes in interest rates on its term ~~loans.~~

In June 2018, the Company entered into an interest rate swap with multiple counterparties that had an initial aggregate notional value of $1.01 billion, an effective date of December 31, 2018, and will expire on June 30, 2021. As of March 31, 2021, the notional value of this interest rate swap was $894.0 million.

loan. In March 2020, the Company entered into interest rate swaps with multiple counterparties. The interest rate swaps had an initial aggregate notional value of $549.2 million that ~~will increase~~increased to $1.42 billion on June 30, 2021, an effective date of March 31, 2020, and will expire on March 31, 2023. As of March 31, ~~2021,~~2022, the notional value of these interest rate swaps was ~~$572.7 million.~~

On October 30, 2020, the Company entered into a foreign exchange forward in order to minimize monthly foreign currency remeasurement gains or losses on non-functional currency monetary balances. The foreign exchange forward notional value may be adjusted each month as the exposure balance changes. The Company did not designate the derivative as a hedge. All changes in the fair value of the foreign exchange forward are recorded in earnings every month to other expense (income) ~~expense,~~, net in the accompanying condensed consolidated statements of income. The Company recognized $1.9 million of realized losses and $1.1 million of realized gains during the three months ended March 31, 2022 and 2021, respectively, related to this foreign exchange forward. As of March 31, ~~2021,~~2022, the notional value of this foreign exchange forward was ~~$50.0~~$75.0 million.

The fair values of the Company’s derivative financial instruments and the line items on the accompanying condensed consolidated balance sheets to which they were recorded were as follows (in thousands):

		Balance Sheet Classification	March 31, 2021		December 31, 2020		Balance Sheet Classification	March 31, 2022		December 31, 2021
Interest rate swaps - current		Accrued expenses	$	11,507	$	17,045	Prepaid expenses and other current assets	$	12,182	$	—
Interest rate swaps - non-current		Other long-term liabilities		3,161		5,572	Other long-term assets		—		948
Fair value of derivative assets								$	12,182	$	948

Interest rate swaps - current							Accrued expenses	$	—	$	1,827
Fair value of derivative liabilities	Fair value of derivative liabilities		$	14,668	$	22,617		$	—	$	1,827

As of March 31, ~~2021~~2022 and December 31, ~~2020,~~2021, the Company’s financial assets and liabilities carried at fair value included cash and cash equivalents, restricted cash, trading securities, accounts receivable, unbilled services (including contract assets), accounts payable, accrued expenses, deferred revenue, contingent obligations, liabilities under the accounts receivable financing agreement, and derivative instruments.

The fair values of cash and cash equivalents, restricted cash, accounts receivable, unbilled services (including contract assets), accounts payable, accrued expenses, deferred revenue, and the liabilities under the accounts receivable financing agreement approximate their respective carrying amounts because of the liquidity and short-term nature of these financial instruments.

As of March 31, ~~2021,~~2022, the fair values of the major classes of the Company’s assets and liabilities measured at fair value on a recurring basis were as follows (in thousands):

	Level 1		Level 2		Level 3		Investments Measured at Net Asset Value		Total		Level 1		Level 2		Level 3		Investments Measured at Net Asset Value		Total
Assets:
Trading securities (a)	$	23,663	$	—	$	—	$	—	$	23,663	$	23,479	$	—	$	—	$	—	$	23,479
Partnership interest (b)		—		—		—		8,391		8,391
Partnership interests (b)												—		—		—		11,472		11,472
Derivative instruments (c)												—		12,182		—		—		12,182
Total assets	$	23,663	$	—	$	—	$	8,391	$	32,054	$	23,479	$	12,182	$	—	$	11,472	$	47,133

Liabilities:
Derivative instruments (c)	$	—	$	14,668	$	—	$	—	$	14,668
Contingent obligations related to acquisitions (d)											$	—	$	—	$	17,941	$	—	$	17,941
Total liabilities	$	—	$	14,668	$	—	$	—	$	14,668	$	—	$	—	$	17,941	$	—	$	17,941

As of December 31, ~~2020,~~2021, the fair values of the major classes of the Company’s assets and liabilities measured at fair value on a recurring basis were as follows (in thousands):

	Level 1		Level 2		Level 3		Investments Measured at Net Asset Value		Total		Level 1		Level 2		Level 3		Investments Measured at Net Asset Value		Total
Assets:
Trading securities (a)	$	22,950	$	—	$	—	$	—	$	22,950	$	24,775	$	—	$	—	$	—	$	24,775
Partnership interest (b)		—		—		—		8,665		8,665
Partnership interests (b)												—		—		—		11,176		11,176
Derivative instruments (c)												—		948		—		—		948
Total assets	$	22,950	$	—	$	—	$	8,665	$	31,615	$	24,775	$	948	$	—	$	11,176	$	36,899

Liabilities:
Derivative instruments (c)	$	—	$	22,617	$	—	$	—	$	22,617	$	—	$	1,827	$	—	$	—	$	1,827
Contingent obligations related to business combinations (d)		—		—		6,793		—		6,793
Contingent obligations related to acquisitions (d)												—		—		17,997		—		17,997
Total liabilities	$	—	$	22,617	$	6,793	$	—	$	29,410	$	—	$	1,827	$	17,997	$	—	$	19,824

(a) Represents the fair value of investments in mutual funds based on quoted market prices that are used to fund the liability associated with the Company’s deferred compensation plan.

(b) The Company has committed to invest $21.5 million as a limited partner in 2 private equity funds. The private equity funds invest in opportunities in the healthcare and life sciences industry. As of March 31, ~~2021,~~2022, the Company’s remaining unfunded commitment in the private equity funds was ~~$13.9~~$12.5 million. The Company holds minor ownership interests (less than 3%) in each of the private equity funds and has determined that it does not exercise significant influence over the private equity funds’ operating and finance activities. As the private equity funds do not have readily determinable fair values, the Company has estimated the fair values using each fund’s Net Asset Value, the amount by which the value of all assets exceeds all debt and liabilities, in accordance with ~~ASC~~Accounting Standards Codification (“ASC”) Topic 946, Financial Services – Investment Companies.

(d) Represents the fair value of contingent consideration obligations related to ~~business combinations.~~acquisitions. The fair values of these liabilities are determined based on the Company’s best estimate of the probable timing and amount of settlement.

The following table presents a reconciliation of changes in the carrying amount of contingent obligations classified as Level 3 for the three months ended March 31, ~~2021~~2022 (in thousands):

Balance as of December 31, 2020	$	6,793
Balance as of December 31, 2021				$	17,997
Additions		0			0
Changes in fair value recognized in earnings		(597	)		(56	)
Payments ~~(a)~~		(6,196	)		0
Balance as of March 31, 2021	$	0
Balance as of March 31, 2022				$	17,941

(a) The Company made payments during the three months ended March 31, 2021 to fully settle the contingent tax-sharing obligation arising from inVentiv Health, Inc.’s 2016 merger with Double Eagle Parent, Inc. (see “Note 16 – Commitments and Contingencies” for further information).

~~As of March 31, 2021, there were no contingent obligations outstanding.~~ During the three months ended March 31, ~~2021,~~2022, there were 0 transfers of assets or liabilities between Level 1, Level 2, or Level 3 fair value measurements.

Certain assets, including goodwill and identifiable intangible assets, are carried on the accompanying condensed consolidated balance sheets at cost and, subsequent to initial recognition, are measured at fair value on a non-recurring basis when certain identified events or changes in circumstances that may have a significant adverse effect on the carrying values of these assets occur. These assets are classified as Level 3 fair value measurements within the fair value hierarchy. Goodwill is tested for impairment annually or more frequently if events or changes in circumstances indicate a triggering event has occurred. Intangible assets are tested for impairment upon the occurrence of certain triggering events. As of March 31, ~~2021~~2022 and December 31, ~~2020,~~2021, assets carried on the condensed consolidated balance sheets and not remeasured to fair value on a recurring basis totaled ~~$5.68~~$5.77 billion and ~~$5.71~~$5.83 billion, respectively.

The estimated fair values of the term ~~loans~~loan (based on tranche) and the ~~Senior~~ Notes are determined based on the price that the Company would have had to pay to settle the liabilities. As these liabilities are not actively traded, they are classified as Level 2 fair value measurements. The estimated fair values of the Company’s term ~~loans~~loan (based on tranche) and the Notes were as follows (in thousands):

	March 31, 2021				December 31, 2020				March 31, 2022				December 31, 2021
	Carrying Value (a)		Estimated Fair Value		Carrying Value (a)		Estimated Fair Value		Carrying Value (a)		Estimated Fair Value		Carrying Value (a)		Estimated Fair Value
Term Loan A - tranche one due March 2024	$	173,508	$	173,962	$	183,320	$	183,026	$	149,026	$	148,635	$	149,008	$	148,945
Term Loan A - tranche two due August 2024		1,239,681		1,243,693		1,271,255		1,269,213		1,634,946		1,630,597		1,634,756		1,635,138
Term Loan B		496,117		497,041		560,194		560,144
3.625% Senior Unsecured Notes due 2029		600,000		586,500		600,000		602,412
Senior notes due January 2029										600,000		557,250		600,000		595,500

(a) The carrying value of the term loan debt is shown net of original issue discounts.

During the three months ended March 31, 2022 and 2021, the Company incurred employee severance and benefit costs, facility and lease termination costs, and other costs related to ~~the Company’s~~its restructuring ~~activities.~~activities. These costs were primarily related to the Company’s ForwardBoundmargin enhancement initiative.~~initiative.~~

	Three Months Ended March 31,				Three Months Ended March 31,
	2021		2020		2022			2021
Employee severance and benefit costs	$	6,293	$	7,621	$	14,820		$	6,293
Facility and lease termination costs		888		733		(319	)		888
Other costs		47		366		1,056			47
Total restructuring and other costs	$	7,228	$	8,720	$	15,557		$	7,228

The Company expects to continue to incur costs related to restructuring of its operations in order to achieve cost savings and the targeted synergies related to its ~~business combinations.~~acquisitions. However, the timing and the amount of these costs depends on various factors, including, but not limited to, identifying and realizing synergy opportunities and executing the integration of its combined operations. The Company may also continue to incur additional restructuring and other costs during ~~2021~~2022 and beyond related to its ForwardBound margin enhancement initiative.

The following table summarizes activity related to employee severance and benefit costs within accrued restructuring liabilities for the ~~liabilities associated with restructuring and other costs~~three months ended March 31, 2022 (in thousands):

	Employee Severance Costs			Other Costs			Total
Balance as of December 31, 2020	$	5,830		$	—		$	5,830
Balance as of December 31, 2021										$	6,657
Expenses incurred (a)		6,293			47			6,340			14,820
Payments		(8,716	)		(47	)		(8,763	)		(7,893	)
Balance as of March 31, 2021	$	3,407		$	—		$	3,407
Balance as of March 31, 2022										$	13,584

(a) The amount of expenses incurred for the three months ended March 31, ~~2021~~2022 excludes ~~$0.9~~$1.1 million of other costs that are included in accounts payable and $0.3 million of facility lease closure and lease termination costs that are reflected as ~~a reduction~~reductions of operating lease right-of-use assets, current portion of operating lease obligations, and operating lease long-term obligations under ASC Topic 842, Leases,on the ~~unaudited~~accompanying condensed consolidated balance ~~sheet under ASC 842.~~sheet.

The Company expects the employee severance and benefit costs accrued as of March 31, ~~2021~~2022 will be paid within the next twelve ~~months. Liabilities associated with restructuring~~months and ~~other costs~~ are included inwithin accrued expenses ~~and other long-term liabilities~~ on the accompanying condensed consolidated balance sheets.

	Three Months Ended March 31,						Three Months Ended March 31,
	2021			2020			2022			2021
Common stock shares, beginning balance		103,935			103,866			103,764			103,935
Repurchases of common stock		(600	)		(600	)		(1,929	)		(600	)
Issuances of common stock		891			895			723			891
Common stock shares, ending balance		104,226			104,161			102,558			104,226

On November 17, 2020, the Company’s Board of Directors (the “Board”) authorized the repurchase of up to an aggregate of $300.0 million of the Company’s Class A common stock, par value $0.01 per share, to be executed from time to time in open market transactions effected through a broker at prevailing market prices, in block trades, or through privately negotiated transactions through December 31, 2022 (the “Stock Repurchase Program”). The Stock Repurchase Program took effect on January 1, 2021.

The Stock Repurchase Program does not obligate the Company to repurchase any particular amount of the Company’s common stock, and may be modified, extended, suspended, or discontinued at any time. The timing and amount of repurchases will be determined by the Company’s management based on a variety of factors such as the market price of the Company’s common stock, the Company’s corporate cash requirements, and overall market conditions. The Stock Repurchase Program is subject to applicable legal requirements, including federal and state securities laws and applicable Nasdaq rules. The Company may also repurchase shares of its common stock pursuant to a trading plan meeting the requirements of Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, which ~~permits~~would permit shares of the Company’s common stock to be repurchased when the Company might otherwise be precluded from doing so by law.

During the three months ended March 31, 2021, the Company repurchased 600,000 shares of its common stock in a private transaction under the Stock Repurchase Program, for a total purchase price of approximately $44.5 million.

The following table sets forth repurchase activity under the Stock Repurchase Program from inception through March 31, ~~2021:~~2022:

	Total number of shares purchased		Average price paid per share		Approximate dollar value of shares purchased (in thousands)		Total number of shares purchased		Average price paid per share		Approximate dollar value of shares purchased (in thousands)
March 2021		600,000	$	74.18	$	44,505		600,000	$	74.18	$	44,505
May 2021								400,000		81.04		32,416
June 2021								500,000		81.20		40,600
February 2022								515,003		78.52		40,439
March 2022								1,413,920		77.46		109,522
Total		600,000			$	44,505		3,428,923			$	267,482

The Company immediately retired all of the repurchased common stock and charged the par value of the shares to common stock. The excess of the repurchase price over the par value was applied on a pro rata basis against additional paid-in capital, with the remainder applied to accumulated deficit.

As of March 31, ~~2021,~~2022, the Company had remaining authorization to repurchase up to approximately ~~$255.5~~$32.5 million of shares of its common stock under the Stock Repurchase Program.

The following table provides a reconciliation of the numerators and denominators of the basic and diluted earnings per share computations (in thousands, except per share data):

	Three Months Ended March 31,				Three Months Ended March 31,
	2021		2020		2022		2021
Numerator:
Net income	$	38,724	$	33,574	$	46,176	$	38,724
Denominator:
Basic weighted average common shares outstanding		104,274		104,265		103,665		104,274
Effect of dilutive securities:
Stock options and other awards under deferred share-based compensation programs		1,183		1,377		745		1,183
Diluted weighted average common shares outstanding		105,457		105,642		104,410		105,457
Earnings per share:
Basic	$	0.37	$	0.32	$	0.45	$	0.37
Diluted	$	0.37	$	0.32	$	0.44	$	0.37

Potential common shares outstanding that are considered anti-dilutive are excluded from the computation of diluted earnings per share. Potential common shares related to stock options and other awards under share-based compensation programs may be determined to be anti-dilutive based on the application of the treasury stock method. Potential common shares are also considered anti-dilutive in periods when the Company incurs a net loss.

The number of potential shares outstanding that were anti-dilutive and therefore excluded from the computation of diluted earnings per share, weighted for the portion of the period they were outstanding, were 165,042 and166,166, ~~and 910,918~~ for the three months ended March 31, 2022 and 2021, ~~and 2020,~~ respectively.

For the three months ended March 31, ~~2021~~2022, the Company recorded income tax expense of ~~$8.3~~$7.3 million, compared to pre-tax income of ~~$47.0~~$53.5 million. Income tax expense for the three months ended March 31, ~~2021~~2022 included a discrete tax benefit of ~~$3.6~~$6.1 million, primarily related to excess tax benefits from share-based compensation. The effective tax rate for the three months ended March 31, ~~2021,~~2022, excluding discrete items, varied from the United States (“U.S.”) federal statutory income tax rate of 21.0% primarily due to foreign income inclusions such as the Global Intangible Low-Taxed Income (“GILTI”) provisions, ~~foreign tax credits, and~~ state and local taxes on U.S. ~~income.~~income, and research and development credits.

For the three months ended March 31, ~~2020,~~2021, the Company recorded income tax expense of ~~$8.2~~$8.3 million, compared to pre-tax income of ~~$41.8~~$47.0 million. Income tax expense for the three months ended March 31, ~~2020~~2021 included ~~$7.1 million of~~a discrete tax ~~benefits~~benefit of $3.6 million, primarily related to excess tax benefits from share-based ~~compensation and the benefit from foreign tax credits related to prior years that were quantified or claimed on amended returns during the period.~~ compensation. The effective tax rate for the three months ended March 31, ~~2020~~2021, excluding discrete items, varied from the U.S. federal statutory income tax rate of 21.0% primarily due to foreign income inclusions such as the GILTI provisions, foreign tax credits, and state and local taxes on U.S. income ~~and research and general business credits~~.

The Company’s gross unrecognized tax benefits, exclusive of associated interest and penalties, were $~~9.5~~12.1 million ~~and $9.0 million~~ as of March 31, ~~2021~~2022 and December 31, ~~2020, respectively. The increase of $0.5 million was primarily due to unrecognized tax benefits in foreign jurisdictions.~~2021. The Company believes it is reasonably possible that its unrecognized tax benefits may decrease by approximately ~~$0.6~~$1.5 million within the next 12 months as a result of lapses in statutes of limitations.

The Company is not currently under any U.S. ~~Federal~~federal income tax audits, however, income tax returns are under examination by tax authorities in several state and foreign jurisdictions. The Company’s federal and state tax filings are open to investigations in numerous years due to net operating loss carryforwards. Additionally, the Company currently has an ongoing examination for tax years ~~2017 and 2018~~2014 to 2019 in the United Kingdom. The United Kingdom is the jurisdiction with the Company’s largest foreign operations. The Company believes that its reserve for uncertain tax positions is adequate to cover existing risks or exposures related to all open tax ~~years.~~years and jurisdictions.

As of March 31, ~~2021,~~2022, the total aggregate transaction price allocated to the unsatisfied performance obligations under contracts with contract terms greater than one year and that are not accounted for as a series pursuant to ASC Topic 606,

Revenue from Contracts with Customers and all the related amendments was ~~$6.93~~$6.68 billion. This amount includes revenue associated with reimbursable out-of-pocket expenses. The Company expects to recognize revenue over the remaining contract term of the individual projects, with contract terms generally ranging from one to five years. The amount of unsatisfied performance obligations is presented net of any constraints and, as a result, is lower than the potential contractual revenue. The contracts excluded due to constraints include contracts that do not commence within a certain period of time or that require the Company to undertake numerous activities to fulfill these performance obligations, including various activities that are outside of the Company’s control.

During the three months ended March 31, ~~2021,~~2022, the Company recognized approximately ~~$349.8~~$389.5 million of revenue that was included in the deferred revenue balance at the beginning of the period. During the three months ended March 31, ~~2021,~~2022, approximately ~~$26.3~~$6.3 million of the Company’s revenue recognized was allocated to performance obligations partially satisfied in previous periods, substantially all of which was associated with changes in scope or price for ~~full service~~full-service clinical studies. The gross and net amounts of revenue recognized solely from changes in estimates were not material.

The Company is managed through 2 reportable segments: Clinical Solutions and Commercial Solutions. Each reportable segment consists of multiple service offerings that, when combined, create a fully integrated biopharmaceutical services organization. Clinical Solutions offers ~~a variety~~comprehensive global services for the development of ~~services~~ diagnostics, drugs, biologics, devices, and digital therapeutics that span~~spanning~~ Phases I to IV of clinical ~~development~~development. The segment is organized around clinical pharmacology and bioanalytical services, workforce deployment, ,full-service clinical studies, real world evidence, and consulting. This segment offers individual services including ~~full service global studies, as well as individual service offerings such as~~product development and regulatory consulting, project management, protocol development, investigational site recruitment, clinical monitoring, ~~investigator recruitment,~~technology-enabled patient recruitment ~~data management,~~ and ~~study startup to assist customers with their drug development process.~~engagement, clinical home health services, clinical trial diversity, biometrics, and regulatory affairs; all across a comprehensive range of therapeutic areas. Commercial Solutions provides the pharmaceutical, biotechnology, and healthcare industries with commercialization services, including deployment solutions, communication solutions (public relations, advertising, and medical communications), and consulting services.

The Company’s Chief Operating Decision Maker ~~(“CODM”~~(the “CODM”) reviews segment performance and allocates resources based upon segment revenue and income from operations. Inter-segment revenue is eliminated from the segment reporting ~~presented~~provided to the CODM and is not included in the segment revenue presented in the table below. Certain costs are not allocated to the Company’s reportable segments and are reported as general corporate expenses. These costs primarily consist of share-based compensation, general operating expenses associated with the Board and the Company’s senior leadership, finance, investor relations, and internal audit functions, and transaction and integration-related expenses. The Company does not allocate depreciation, amortization, asset impairment charges, or restructuring and other costs to its segments. Prior period segment results have been recast to ~~reflect the transfer of the Kinapse Regulatory and Operations Consulting service lines from Commercial Solutions~~conform to ~~Clinical Solutions~~insignificant changes to ~~align with~~ management reporting in ~~2021.~~2022. Additionally, the CODM reviews the Company’s assets on a consolidated basis and does not allocate assets to its reportable segments for purposes of assessing segment performance or allocating resources.

Information about reportable segment operating results was as follows (in thousands):

	Three Months Ended March 31,				Three Months Ended March 31,
	2021		2020		2022		2021
Revenue:
Clinical Solutions	$	937,954	$	882,501	$	1,018,370	$	939,567
Commercial Solutions		270,791		280,854		317,883		269,178
Total revenue		1,208,745		1,163,355		1,336,253		1,208,745
Segment direct costs:
Clinical Solutions		716,113		682,174		774,668		717,355
Commercial Solutions		220,042		233,658		260,965		218,800
Total segment direct costs		936,155		915,832		1,035,633		936,155
Segment selling, general, and administrative expenses:
Clinical Solutions		87,532		76,344		89,902		87,532
Commercial Solutions		20,971		22,610		21,735		20,971
Total segment selling, general, and administrative expenses		108,503		98,954		111,637		108,503
Segment operating income:
Clinical Solutions		134,309		123,983		153,800		134,680
Commercial Solutions		29,778		24,586		35,183		29,407
Total segment operating income		164,087		148,569		188,983		164,087
Direct costs and operating expenses not allocated to segments:
Share-based compensation included in direct costs		9,095		8,182		8,799		9,095
Share-based compensation included in selling, general, and administrative expenses		8,258		7,816		8,534		8,258
Corporate selling, general, and administrative expenses		20,553		18,777		19,995		20,553
Restructuring and other costs		7,228		8,720		15,557		7,228
Depreciation and amortization		57,938		56,107		62,202		57,938
Total income from operations	$	61,015	$	48,967	$	73,896	$	61,015

The following table summarizes total revenue by geographic area (in thousands, all intercompany transactions have been eliminated):

	Three Months Ended March 31,				Three Months Ended March 31,
	2021		2020		2022		2021
Revenue:
North America (a)	$	739,001	$	753,045	$	781,654	$	739,001
Europe, Middle East, and Africa		316,176		268,022		355,593		316,176
Asia-Pacific		126,457		117,053		160,803		126,457
Latin America		27,111		25,235		38,203		27,111
Total revenue	$	1,208,745	$	1,163,355	$	1,336,253	$	1,208,745

(a) Revenue for the North America region includes revenue attributable to the ~~United States~~U.S. of $736.4 million and $693.9 million, or 55.1% and ~~$713.4 million, or~~ 57.4% ~~and 61.3%~~ of total revenue, for the three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, respectively. No other country represented more than 10% of total revenue for any period.

The following table summarizes long-lived assets by geographic area (in thousands, all intercompany transactions have been eliminated):

	March 31, 2021		December 31, 2020		March 31, 2022		December 31, 2021
Property and equipment, net:
North America (a)	$	151,611	$	161,531	$	177,684	$	165,446
Europe, Middle East, and Africa		36,508		38,745		35,937		37,004
Asia-Pacific		9,392		11,167		18,321		13,615
Latin America		5,107		4,757		8,073		6,592
Total property and equipment, net	$	202,618	$	216,200	$	240,015	$	222,657

(a) Long-lived assets for the North America region include property and equipment, net attributable to the ~~United States~~U.S. of ~~$145.8~~$172.0 million and ~~$156.0~~$160.0 million as of March 31, ~~2021~~2022 and December 31, ~~2020,~~2021, respectively.

Financial assets that subject the Company to credit risk primarily consist of cash and cash equivalents, accounts receivable, and unbilled services (including contract assets). The Company’s cash and cash equivalents consist principally of cash and are maintained at several financial institutions with reputable credit ratings. The Company maintains cash depository accounts with several financial institutions worldwide and is exposed to credit risk related to the potential inability to access liquidity in financial institutions where its cash and cash equivalents are concentrated. The Company has not historically incurred any losses with respect to these balances and believes that they bear minimal credit risk.

As of March 31, ~~2021~~2022 and December 31, ~~2020, the majority~~2021, substantially all of the Company’s cash and cash equivalents were held within the ~~United States.~~U.S.

No single customer accounted for greater than 10% of the Company’s revenue for the three months ended March 31, ~~2021 and 2020.~~2022 or 2021.

As of March 31, ~~2021~~2022 and December 31, ~~2020,~~2021, no single customer accounted for greater than 10% of the Company’s accounts receivable and unbilled services (including contract assets) balances.

For the three months ended March 31, 2022, the Company had combined revenue of $1.3 million from three customers whose board of directors each included a member who was also a member of the Company’s Board. As of March 31, 2022, the Company had receivables of $0.3 million from one customer whose board of directors included a member who was also a member of the Company’s Board.

On February 8, 2022, the Company completed an insignificant acquisition, which was associated with the 2021 acquisition of RXDataScience, Inc., through an arm’s-length transaction. A member of the Company’s management was a minority shareholder of the acquired company. For additional information, refer to “Note 2 – Financial Statements Details – Goodwill.”

For the three months ended March 31, 2021, the Company had revenue of $0.3 million and, as of March 31, 2021,, receivables of $0.3 million from 1 customer whose board of directors included a member who was also a member of the Company’s Board.

The Company is involved in various claims and legal actions arising in the ordinary course of business. The Company accrues a liability when a loss is considered probable and the amount can be reasonably estimated. When a material loss contingency is reasonably possible but not probable, the Company does not record a liability, but instead discloses the nature and the amount of the claim, and an estimate of the loss or range of loss, if such an estimate can be made. Legal fees are expensed as incurred. In the opinion of management, the outcome of any existing claims and legal or regulatory proceedings, other than ~~the specific matters described below,~~Vaitkuvienë v. Syneos Health, Inc., et al, No. 18-0029 (E.D.N.C.) (the “Vaitkuvienë action”), if decided adversely, is not expected to have a material adverse effect on the ~~Company's~~Company’s business, financial condition, results of operations, or cash flows.

~~On December 1, 2017, the first of 2~~ virtually identical actions alleging federal securities law claims was filed against the Company and certain of its officers on behalf of a putative class of its shareholders. The first action, captioned Bermudez v. INC Research, Inc., et al, No. 17-09457 (S.D.N.Y.) in the Southern District of New York, names as defendants the Company, Michael Bell, Alistair Macdonald, Michael Gilbertini, and Gregory S. Rush (the “Bermudez action”), and the second action, Vaitkuvienë v. Syneos Health, Inc., et al, No. 18-0029 (E.D.N.C.) in the Eastern District of North Carolina, filed on January 25, 2018 (the “Vaitkuvienë action”), names as defendants the Company, Alistair Macdonald, and Gregory S. Rush (the “Initial Defendants”). Both complaints allege similar claims under Section 10(b) and Section 20(a) of the Securities Exchange Act of 1934 on behalf of a putative class of purchasers of the Company’s common stock between May 10, 2017 and November 8, 2017 (for the Vaitkuvienë action) and November 9, 2017 (for the Bermudez action). The complaints allege that the Company published inaccurate or incomplete information regarding, among other things, the financial performance and business outlook for inVentiv’s business prior to the 2017 merger (the “Merger”) with Double Eagle Parent, Inc. (“inVentiv”), the parent company of inVentiv Health, Inc., and with respect to the combined company following the Merger. On January 30, 2018, 2 alleged shareholders separately filed motions seeking to be appointed lead plaintiff and approving the selection of lead counsel. On March 30, 2018, Plaintiff in the Bermudez action filed a notice of voluntary dismissal of the Bermudez action, without prejudice, and as to all defendants. On May 29, 2018, the Court in the Vaitkuvienë action included in “Note 17 – Commitments and Contingencies” to the consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data” in the 2021 Form 10-K.

On April 28, 2022, the Board appointed Michelle Keefe as the ~~San Antonio Fire & Police Pension Fund~~Company’s Chief Executive Officer and ~~El Paso Firemen & Policemen’s Pension Fund~~ as ~~Lead Plaintiffs and, on June 7, 2018, the Court entered~~ a schedule providing for, among other things, Lead Plaintiffs to file an amended complaint by July 23, 2018 (later extended to July 30, 2018). Lead Plaintiffs filed their amended complaint on July 30, 2018, which also includes a claim against the Initial Defendants,Class I director, each effective as ~~well~~of April 29, 2022 (the “Effective Date”), succeeding Alistair Macdonald, who resigned from both positions as ~~each member~~ of the ~~board of directors at the time~~Effective Date. Also as of the ~~INC Research - inVentiv Health merger vote in July 2017 (the “Defendants”), contending that~~Effective Date, Michael Brooks was appointed to serve as the inVentiv merger proxy was misleading under Section 14(a) of the Act. Lead Plaintiffs seek, among other things, orders (i) declaring that the lawsuit is a proper class action and (ii) awarding compensatory damages in an amount to be proven at trial, including interest thereon, and reasonable costs and expenses incurred in this action, including attorneys’ fees and expert fees, to Lead Plaintiffs and other class members. Defendants filed a Motion to Dismiss Plaintiffs’ Amended Complaint on September 20, 2018. Lead Plaintiffs filed a Response in Opposition to such motion on November 21, 2018, and Defendants filed a Reply to such response on December 5, 2018. The District Court referred the Motion to Dismiss to a magistrate judge for a report and recommendation. On September 26, 2019, the magistrate judge stayed the action and, on August 7, 2020, the magistrate judge lifted the stay. Also on August 7, 2020, the magistrate judge issued a report (the “Magistrate Report”) recommending to the District Court that Defendants’ Motion to Dismiss be denied. On September 4, 2020, Defendants filed written objections to the Magistrate Report, requesting that the District Court grant the Motion to Dismiss. Lead Plaintiffs filed Company’s Chief Operating Officer.~~a Response in Opposition to such objections on October 2, 2020. The Company and the other defendants deny the allegations in these complaints and intend to defend vigorously against these claims.~~

The Company is presently unable to predict the duration, scope, or result of the foregoing putative class actions, or any other related lawsuit. As such, the Company is presently unable to develop a reasonable estimate of a possible loss or range of losses, if any, related to these matters. While the Company intends to defend the putative class action litigation vigorously, the outcome of such litigation or any other litigation is necessarily uncertain. The Company could be forced to expend significant resources in the defense of these lawsuits or future ones, and it may not prevail. As such, these matters could have a material adverse effect on the Company's business, annual, or interim results of operations, cash flows, or its financial condition.

As a result of the Merger, the Company assumed contingent tax-sharing obligations arising from inVentiv Health, Inc.’s 2016 merger with Double Eagle Parent, Inc. During the three months ended March 31, 2021, the Company made payments of $6.2 million to fully settle this outstanding obligation. As of December 31, 2020, the estimated fair value of the assumed contingent tax-sharing obligations was $6.8 million.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our unaudited condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q, and with our audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020.~~2021 (our “2021 Form 10-K”).

In addition to historical condensed consolidated financial information, this Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect, among other things, our current expectations and anticipated results of operations, all of which are subject to known and unknown risks, uncertainties, and other factors that may cause our actual results, performance or achievements, market trends, or industry results to differ materially from those expressed or implied by such forward-looking statements. Therefore, any statements contained herein that are not statements of historical fact may be forward-looking statements and should be evaluated as such, including our business strategy, the future impact of the COVID-19 pandemic on our business, financial results, and financial condition, benefits of acquisitions, and planned capital expenditures. Without limiting the foregoing, the words “anticipates,” “believes,” “can,” “continue,” “could,” “estimates,” “expects,” “intends,” “may,” “might,” “plans,” “projects,” “should,” “would,” “targets,” “will” and the negative thereof and similar words and expressions are intended to identify forward-looking statements. Unless legally required, we assume no obligation to update any such forward-looking information to reflect actual results or changes in the factors affecting such forward-looking information.

We caution you that any such forward-looking statements are further qualified by important factors that could cause our actual operating results to differ materially from those in the forward-looking statements, including without limitation, regional, national, or global political, economic, business, competitive, market, and regulatory conditions and the following: risks associated with the COVID-19 pandemic; our potential failure to generate a large number of new business awards and the risk of delay, termination, reduction in scope, or failure to go to contract of our business awards; our potential failure to convert backlog to revenue; fluctuations in our operating results and effective income tax rate; the impact of potentially underpricing our contracts, overrunning our cost estimates, or failing to receive approval for or experiencing delays with documentation of change orders; cyber-security and other risks associated with our information systems infrastructure; changes and costs of compliance with regulations related to data privacy; concentration of our customers or therapeutic areas; the risks associated with doing business ~~internationally;~~internationally, including risks related to the ~~impact of the U.K.’s withdrawal from the European Union;~~war in Ukraine; challenges by tax authorities of our intercompany transfer pricing policies; our potential failure to successfully increase our market share, grow our business, and execute our growth strategies; our ability to effectively upgrade our information systems; our failure to perform our services in accordance with contractual requirements, regulatory standards, and ethical considerations; risks related to the management of clinical trials; ~~risks related to investments in our customers’ businesses or drugs and our related commercial rights strategies;~~ the need to hire, develop, and retain key personnel; the impact of unfavorable economic conditions, including the uncertain international economic environment and changes in foreign currency exchange rates; effective income tax rate fluctuations; our ability to protect our intellectual property; risks related to our acquisition strategy, including our ability to realize synergies; our relationships with customers who are in competition with each other; any failure to realize the full value of our goodwill and intangible assets; risks related to restructuring; our compliance with anti-corruption and anti-bribery laws; our dependence on third parties; potential employment liability; the increasing focus on environmental sustainability and social initiatives; our ability to utilize net operating loss carryforwards and other tax attributes; downgrades of our credit ratings; competition in the biopharmaceutical services industry; outsourcing trends and changes in aggregate spending and research and development budgets; the impact of, including changes in, government regulations and healthcare reform; intense competition faced by our customers from lower cost generic products and other competing products; our ability to keep pace with rapid technological change; the cost of and our ability to service our substantial indebtedness; and other risks related to ~~ownership of our common stock. For a~~

ownership of our common stock. For a further discussion of the risks relating to our business, refer to ~~“Risk Factors” in~~ Part I, Item 1A, of“Risk Factors” in our ~~Annual Report on~~2021 Form ~~10-K for the fiscal year ended December 31, 2020.~~10-K.

We are ~~a leading global~~the only fully integrated biopharmaceutical solutions organization ~~providing~~purpose-built to accelerate customer success. We lead with a ~~full suite of~~product development mindset, strategically blending clinical development, medical affairs, and commercial ~~services~~capabilities to address modern market realities for customers in the biopharmaceutical, biotechnology, and healthcare industries. We offer both stand-alone and integrated biopharmaceutical product development solutions ranging from ~~Early Phase~~early phase (Phase I) clinical trials to the full commercialization of biopharmaceutical products, with the goal of increasing the likelihood of regulatory approval and commercial success.

Our operations are divided into two reportable segments, Clinical Solutions and Commercial Solutions. Our Clinical Solutions segment offers ~~a variety~~comprehensive global services for the development of ~~services~~ ~~spanning~~ diagnostics, drugs, biologics, devices, and digital therapeutics that span Phases I to IV of clinical ~~development, including full service global~~development. The segment is organized around clinical pharmacology and bioanalytical services, workforce deployment, full-service clinical studies,~~and~~ real world evidence, ~~programs, as well as individual service offerings such as clinical monitoring, investigator recruitment, patient recruitment, data management,~~ and ~~study startup to assist customers with their drug development process.~~consulting. Our Commercial Solutions segment provides commercialization services, including deployment solutions, communication solutions ~~(public~~(public relations, advertising, and medical communications), and consulting services. We integrate our clinical and commercial capabilities into customized solutions by sharing knowledge, data, and ~~insights through our Biopharmaceutical Acceleration Model.~~insights. This collaboration across the development and commercialization continuum facilitates unique insights into patient populations, therapeutic environments, product timelines, and the competitive landscape. For a further discussion, refer to ~~“Business” in~~ Part I, Item 1, “Business” in our 2021 Form 10-K.

The ongoing COVID-19 pandemic and associated economic repercussions have significantly impacted, and are expected to continue to impact, our business and our operations. Within Clinical Solutions, the pandemic has accelerated the adoption of ~~our Annual Report on Form 10-K~~virtual engagement with sites and patients, creating increased demand for decentralized solutions capabilities. As a result, we have continued to experience reduced travel and other reimbursable out-of-pocket expenses related to lower physical monitoring visits for Clinical Solutions relative to pre-pandemic levels. We have also experienced a reduction in the ~~fiscal year ended December 31, 2020.~~

~~Prior period segment results have been recast to reflect the transfer of the Kinapse Regulatory and Operations Consulting service lines from~~costs associated with investigational medicinal products, which has also resulted in lower reimbursable out-of-pocket expenses. Within Commercial Solutions, we have continued to ~~Clinical Solutions~~experience fewer field team visits to ~~align with management reporting in 2021.~~

~~On March 11, 2020, the World Health Organization designated the outbreak of the novel strain of coronavirus that causes the disease known as COVID-19~~healthcare providers and increased virtual investigator meetings. Therefore, we expect reimbursable out-of-pocket expenses as a ~~global pandemic. Governments and businesses around the world have taken unprecedented actions~~percentage of revenue to ~~mitigate~~remain lower relative to pre-pandemic levels. With the spread of COVID-19 ~~including, but not limited to, shelter-in-place orders, quarantines, significant restrictions on travel, social distancing practices as well as restrictions that prohibit many employees from~~ ~~going to work in person. As a result, we experienced significant~~variants, the ongoing impacts toof the COVID-19 pandemic could adversely impact our business and results of operations from COVID-19 during 2020 and for the three months ended March 31, 2021. While certain governments have eased restrictions, the pandemic continues to be disruptive to our business. The pandemic and associated economic impacts are expected to continue to significantly ~~impact our future financial condition, results of operations and cash flows.~~

operations. For a further discussion of this and other risks relating to our business, refer to ~~“Risk Factors” in~~ Part I, Item 1A, of“Risk Factors” in our ~~Annual Report on~~2021 Form ~~10-K for the fiscal year ended~~ ~~December 31, 2020~~.10-K.

26Prior period segment results have been recast to conform to insignificant changes to management reporting in 2022.

We add new business awards to backlog when we enter into a contract or when we receive a written commitment from the customer selecting us as a service provider, provided that:

In addition, we continually evaluate our backlog to determine if any of the previously awarded work is no longer expected to be performed, regardless of whether we have received formal cancellation notice from the customer. If we determine that any previously awarded work is no longer probable of being performed, we remove the value from our backlog based on the risk of cancellation. We recognize revenue from these awards as services are performed, provided we have received proper authorization from the customer.

We report new business awards for our Clinical Solutions and Commercial Solutions segments on a trailing twelve months (“TTM”) basis. Our total backlog represents backlog for our Clinical Solutions segment and the deployment solutions offering within our Commercial Solutions segment. We do not report backlog for the remaining service offerings in the Commercial Solutions segment.

Our backlog consists of anticipated future revenue from business awards that either have not started, or that are in process and have not been completed. Our backlog also reflects any cancellation or adjustment activity related to these awards. The average duration of our contracts will fluctuate from period to period based on the contracts comprising our backlog at any given time. The majority of our contracts contain early termination provisions that typically require notice periods ranging from 30 to 90 days.

	2021		2020		Change				2022		2021		Change
Clinical Solutions	$	10,509.9	$	8,578.9	$	1,931.0	22.5	%	$	10,772.3	$	10,514.6	$	257.7	2.5	%
Commercial Solutions - Deployment Solutions		708.1		658.1		50.0	7.6	%		861.8		708.1		153.7	21.7	%
Total backlog	$	11,218.0	$	9,237.0	$	1,981.0	21.4	%	$	11,634.1	$	11,222.7	$	411.4	3.7	%

We expect approximately ~~$3.48~~$3.68 billionof our backlog as of March 31, ~~2021~~2022 will be recognized as revenue during the remainder of ~~2021.~~2022. We adjust the amount of our backlog each quarter for the effects of fluctuations in foreign currency exchange rates.

New business awards, net of cancellations, for the TTM periods ended March 31 were as follows (in millions):

	2021		2020		2022		2021
Clinical Solutions	$	4,720.1	$	4,482.2	$	4,392.9	$	4,730.9
Commercial Solutions		1,160.0		1,242.5		1,399.6		1,149.2
Total net new business awards	$	5,880.1	$	5,724.7	$	5,792.5	$	5,880.1

New business awards have varied and may continue to vary significantly from quarter to quarter. Fluctuations in our net new business award levels often result from the fact that we may receive a small number of relatively large orders in any given reporting period. Because of these large orders, our backlog and net new business awards in a reporting period may reach levels that are not sustainable in subsequent reporting periods.

We believe that our backlog and net new business awards might not be consistent indicators of future revenue because they have been, and likely will continue to be, affected by a number of factors, including the variable size and duration of projects, many of which are performed over several years, and changes to the scope of work during the course of projects. Additionally, projects may be canceled or delayed by the customer or regulatory authorities. Net new business awards and backlog have been and we expect will continue to be affected by the broad effects of the COVID-19 pandemic on the global economy and major financial markets, as well as various other risks and uncertainties detailed in Part I, Item 1A, “Risk Factors” in our ~~Annual Report on~~2021 Form ~~10-K for the fiscal year ended December 31, 2020.~~10-K. We generally do not have a contractual right to the full amount of the awards reflected in our backlog. If a customer cancels an award, we might be reimbursed for the costs we have incurred. As we increasingly compete for and enter into large contracts that are more global in nature, we expect that the rate at which our backlog and net new business awards convert into revenue is likely to decrease, and the duration of projects and the period over which related revenue is recognized to lengthen. For more information about risks related to our backlog see Part I, Item 1A, “Risk Factors -– Risks Related to Our Business -– Our backlog might not be indicative of our future revenues, and we might not realize all of the anticipated future revenue reflected in our backlog.” in our ~~Annual Report on~~2021 Form ~~10-K for the fiscal year ended December 31, 2020.~~10-K.

The following table sets forth amounts from our ~~unaudited~~ condensed consolidated statements of income along with dollar and percentage changes (in thousands, except percentages):

	Three Months Ended March 31,									Three Months Ended March 31,
	2021		2020		Change					2022		2021		Change
Revenue	$	1,208,745	$	1,163,355	$	45,390		3.9	%	$	1,336,253	$	1,208,745	$	127,508		10.5	%
Costs and operating expenses:
Direct costs (exclusive of depreciation and amortization)		945,250		924,014		21,236		2.3	%		1,044,432		945,250		99,182		10.5	%
Selling, general, and administrative expenses		137,314		125,547		11,767		9.4	%		140,166		137,314		2,852		2.1	%
Restructuring and other costs		7,228		8,720		(1,492	)	(17.1	)%		15,557		7,228		8,329		115.2	%
Depreciation and amortization		57,938		56,107		1,831		3.3	%		62,202		57,938		4,264		7.4	%
Total operating expenses		1,147,730		1,114,388		33,342		3.0	%		1,262,357		1,147,730		114,627		10.0	%
Income from operations		61,015		48,967		12,048		24.6	%		73,896		61,015		12,881		21.1	%
Total other expense, net		14,004		7,192		6,812		94.7	%		20,404		14,004		6,400		45.7	%
Income before provision for income taxes		47,011		41,775		5,236		12.5	%		53,492		47,011		6,481		13.8	%
Income tax expense		8,287		8,201		86		1.0	%		7,316		8,287		(971	)	(11.7	)%
Net income	$	38,724	$	33,574	$	5,150		15.3	%	$	46,176	$	38,724	$	7,452		19.2	%

For the three months ended March 31, ~~2021,~~2022, our revenue increased by ~~$45.4~~$127.5 million, or ~~3.9%~~10.5%, to ~~$1,208.7~~$1,336.3 million from ~~$1,163.4~~$1,208.7 million for the three months ended March 31, ~~2020.~~2021. The increase was primarily driven by growth in both our Clinical Solutions ~~segment, which was partially offset by a decrease in our~~and Commercial Solutions ~~segment,~~segments as discussed below.

No single customer accounted for greater than 10% of our total consolidated revenue for the three months ended March 31, ~~2021 and 2020.~~2022 or 2021. Revenue from our top five customers accounted for approximately 23% ~~and 21%~~ of revenue for both the three months ended March 31, ~~2021~~2022 and ~~2020, respectively.~~2021.

	Three Months Ended March 31,															Three Months Ended March 31,
	2021		% of total			2020		% of total			Change					2022		% of total			2021		% of total			Change
Clinical Solutions	$	937,954		77.6	%	$	882,501		75.9	%	$	55,453		6.3	%	$	1,018,370		76.2	%	$	939,567		77.7	%	$	78,803	8.4	%
Commercial Solutions		270,791		22.4	%		280,854		24.1	%		(10,063	)	(3.6	)%		317,883		23.8	%		269,178		22.3	%		48,705	18.1	%
Total revenue	$	1,208,745				$	1,163,355				$	45,390		3.9	%	$	1,336,253				$	1,208,745				$	127,508	10.5	%

For the three months ended March 31, ~~2021,~~2022, revenue attributable to our Clinical Solutions segment increased compared to the same period in the prior year, primarily ~~due to~~driven by increased project start-ups. Additionally, the increase was partially driven by revenue from the acquisitions of ~~SHCR Holdings~~StudyKIK Corporation ~~(“Synteract”)~~ and Illingworth Research Group™ (“Illingworth Research”) that were completed in the fourth quarter of 2020, and increased project start-ups. The revenue increase was partially offset by decreases from the divestiture of our contingent staffing businessRxDataScience, Inc. in the second ~~quarter~~half of ~~2020 and a decline in reimbursable out-of-pocket expenses~~2021. ~~due to the impacts of the COVID-19 pandemic~~. For the three months ended March 31, ~~2021,~~2022, revenue was ~~positively~~negatively impacted by ~~$9.6~~$11.8 million from foreign currency exchange ~~rates~~rate fluctuations compared to the same period in the prior year.

~~Although we are aggressively managing our response to~~The impact from the COVID-19 pandemic ~~we expect that the COVID-19 pandemic will continue to negatively impact~~on our Clinical Solutions revenue ~~throughout 2021,~~continues to decrease. We believe the primary ongoing impact to revenue from the COVID-19 pandemic relates to increased demand for decentralized solutions capabilities including remote monitoring, which results in lower reimbursable out-of-pocket expenses. Therefore, we expect reimbursable out-of-pocket expenses as a percentage of revenue to remain lower relative to pre-pandemic levels.

The war in Ukraine has not had a material impact on our revenue; however, that could change depending on the ~~continuation~~magnitude of the ~~pandemic.~~conflict and the imposition of additional sanctions by the United States (“U.S.”) and other countries. We continue to adapt our strategic approach as the crisis persists and we are expanding our risk assessments to neighboring countries to be proactive about potential future challenges. Banking and economic sanctions imposed on Russia continue to present challenges to clinical trials. We are monitoring these sanctions to ensure we are in compliance and we are adapting our operations to address both the sanctions and the increasing logistical challenges of conducting trials in Russia. At this time, we ~~believe that the ongoing~~are continuing to service patients in existing trials who are currently on medication where possible but are generally no longer initiating new clinical trial activities in either Ukraine or Russia. Any impacts to our revenue ~~in our Clinical Solutions segment will~~are expected to be ~~similar~~temporary in nature as we work with customers to ~~those experienced~~explore alternate sources of recruiting new patients, including potentially activating sites in 2020 with the most significant being the trend of more remote monitoring visits and delayed patient enrollment, resulting in lower reimbursable out-of-pocket expenses and related revenue as the recovery continues. We expect a moderate increase in the use of remote monitoring from pre-COVID-19 levels, although below levels necessitated in 2020.other regions.

For the three months ended March 31, ~~2021,~~2022, revenue attributable to our Commercial Solutions segment ~~decreased~~increased compared to the same period in the prior year, primarily ~~due to a~~ ~~decline in reimbursable out-of-pocket expenses due to the impacts~~driven by increased project start-ups, including new deployments of the COVID-19 pandemic and the divestiture of our medication adherence business in the fourth quarter of 2020. The decrease was partially offset by an increase in revenue from our consulting service offerings.field teams.

~~Although we are aggressively managing our response to~~The impact from the COVID-19 pandemic ~~we expect that the COVID-19 pandemic will continue to negatively impact~~on our Commercial Solutions revenue ~~throughout 2021, depending on~~continues to decrease. We believe the ~~continuation of the pandemic. At this time, we believe that the~~primary ongoing impacts to revenue ~~in our Commercial Solutions segment will be temporary and~~ relate to ~~delayed decision-making related to new business awards, delays or cancellations of existing projects,~~ declines in field team visits to healthcare providers and increased virtual investigator meetings, ~~and travel disruptions, similar to those experienced in 2020, resulting~~which result in lower reimbursable out-of-pocket expenses. Therefore, we expect reimbursable out-of-pocket expenses ~~and related~~as a percentage of revenue ~~as the recovery continues.~~ to remain lower relative to pre-pandemic levels.

Direct costs consist principally of compensation expense and benefits associated with our employees and other employee-related costs, and reimbursable out-of-pocket expenses directly related to delivering on our projects. While we have some ability to manage the majority of these costs relative to the amount of contracted services we have during any given period, direct costs as a percentage of revenue can vary from period to period. Such fluctuations are due to a variety of factors, including, among others: (i) the level of staff utilization on our projects; (ii) adjustments to the timing of work on specific customer contracts; (iii) the experience mix of personnel assigned to projects; (iv) the service mix and pricing of our contracts; and (v) the timing of the incurrence of reimbursable out-of-pocket expenses. ~~As a result of the COVID-19 pandemic,~~Relative to pre-pandemic levels, we ~~have experienced~~continue to experience reduced travel and other reimbursable out-of-pocket expenses related to lower physical monitoring visits for Clinical Solutions, as well as fewer field team visits to healthcare providers and investigator meetings for Commercial Solutions.As discussed above, we expect reimbursable out-of-pocket expenses to remain lower relative to pre-pandemic levels.

Direct costs ~~consisted of the following~~were as follows (dollars in thousands):

	Three Months Ended March 31,										Three Months Ended March 31,
	2021			2020			Change				2022			2021			Change
Direct costs (exclusive of depreciation and amortization)	$	945,250		$	924,014		$	21,236	2.3	%	$	1,044,432		$	945,250		$	99,182	10.5	%
% of revenue		78.2	%		79.4	%						78.2	%		78.2	%
Gross margin %		21.8	%		20.6	%						21.8	%		21.8	%

For the three months ended March 31, ~~2021,~~2022, our direct costs increased by ~~$21.2~~$99.2 million, or ~~2.3%~~10.5%, compared to the three months ended March 31, ~~2020,~~2021, primarily driven by ~~impacts from the acquisitions that were completed in the fourth quarter of 2020, partially offset by decreases from divestitures and lower reimbursable out-of-pocket expenses~~.increased billable headcount to support revenue growth.

Direct costs for our Clinical Solutions segment, excluding share-based compensation expense, were as follows (dollars in thousands):

	Three Months Ended March 31,										Three Months Ended March 31,
	2021			2020			Change				2022			2021			Change
Direct costs	$	716,113		$	682,174		$	33,939	5.0	%	$	774,668		$	717,355		$	57,313	8.0	%
% of segment revenue		76.3	%		77.3	%						76.1	%		76.3	%
Segment gross margin %		23.7	%		22.7	%						23.9	%		23.7	%

For the three months ended March 31, ~~2021,~~2022, our Clinical Solutions segment direct costs increased by ~~$33.9~~$57.3 million, or ~~5.0%~~8.0%, compared to the three months ended March 31, ~~2020. This increase was~~2021, primarily ~~due to the acquisitions that were~~ ~~completed in the fourth quarter of 2020, higher compensation-related expenses due to higher~~driven by increased billable headcount to support revenue growthand, ~~the negative impact of foreign exchange rate fluctuations. This~~to a lesser extent, higher reimbursable out-of-pocket expenses. The increase was partially offset by ~~the divestiture of our~~ ~~contingent staffing business in the second quarter of 2020, a decline in reimbursable out-of-pocket expense~~ ~~due to the impacts of the COVID-19 pandemic, and~~ positive impacts from foreign currency exchange rate fluctuations and our ForwardBound margin enhancement initiative.

Gross margins for our Clinical Solutions segment were ~~23.7%~~23.9% and ~~22.7%~~23.7% for the three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, respectively. Gross margin was higher ~~during~~for the ~~current year period~~three months ended March 31, 2022 as compared to the same period in the prior year ~~primarily~~ due to positive impacts from ~~our~~ ~~ForwardBound~~ ~~margin enhancement initiative~~foreign exchange rate fluctuations and ~~favorable~~lower reimbursable out-of-pocket expenses as a percentage of revenue, ~~mix,~~ partially offset by ~~the negative impact~~a higher mix of ~~foreign exchange rate fluctuations.~~contract labor.

Direct costs for our Commercial Solutions segment, excluding share-based compensation expense, were as follows (dollars in thousands):

	Three Months Ended March 31,											Three Months Ended March 31,
	2021			2020			Change					2022			2021			Change
Direct costs	$	220,042		$	233,658		$	(13,616	)	(5.8	)%	$	260,965		$	218,800		$	42,165	19.3	%
% of segment revenue		81.3	%		83.2	%							82.1	%		81.3	%
Segment gross margin %		18.7	%		16.8	%							17.9	%		18.7	%

For the three months ended March 31, ~~2021,~~2022, our Commercial Solutions segment direct costs ~~decreased~~increased by ~~$13.6~~$42.2 million, or ~~5.8%~~19.3%, compared to the three months ended March 31, ~~2020. This decrease was~~2021, primarily ~~related~~driven by increased billable headcount to ~~a decline in reimbursable out-of-pocket expenses~~ ~~due to the impacts of the COVID-19 pandemic~~ ~~and the divestiture of our medication adherence business in the fourth quarter of 2020.~~support revenue growth.

Gross margins for our Commercial Solutions segment were ~~18.7%~~17.9% and ~~16.8%~~18.7% for the three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, respectively. Gross margin was ~~higher~~lower during the current year period as compared to the same period in the prior year ~~primarily~~ due to a less favorable revenue ~~mix and lower reimbursable out-of-pocket expenses.~~mix.

Selling, general, and administrative expenses were as follows (dollars in thousands):

	Three Months Ended March 31,										Three Months Ended March 31,
	2021			2020			Change				2022			2021			Change
Selling, general, and administrative expenses	$	137,314		$	125,547		$	11,767	9.4	%	$	140,166		$	137,314		$	2,852	2.1	%
% of total revenue		11.4	%		10.8	%						10.5	%		11.4	%

Selling, general, and administrative expenses for the three months ended March 31, ~~2021~~2022 increased compared to the same period in ~~2020~~2021 primarily due to ~~the acquisitions that were completed in the fourth quarter of 2020 and the negative impact of foreign exchange rate fluctuations,~~increased headcount, partially offset by ~~positive impacts from our~~ ~~ForwardBound~~ ~~margin enhancementinitiative. Transaction~~lower transaction and integration-related ~~expenses are no longer reported separately and are included in selling,~~expenses. Selling, general, and administrative ~~expenses.~~expenses for the three months ended March 31, 2022 include costs resulting from the war in Ukraine, including costs related to impacted employees and ongoing assessment of imposed sanctions.

Restructuring and other costs were ~~$7.2~~$15.6 millionand ~~$8.7~~$7.2 million for the three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, respectively. The costs incurred during the three months ended March 31, 2022 and 2021 were primarily related to our ForwardBound margin enhancement initiative as we continue the ongoing evaluations of our workforce and facilities infrastructure needs in an effort to optimize our resources.ForwardBound includes optimization programs across our entire business. During the first quarter of 2022, these ForwardBound initiatives included specific actions focused on streamlining the operations of our Clinical Solutions segment to optimize efficiency and enhance the delivery of customer projects.

	Three Months Ended March 31,				Three Months Ended March 31,
	2021		2020		2022			2021
Employee severance and benefit costs	$	6,293	$	7,621	$	14,820		$	6,293
Facility and lease termination costs		888		733		(319	)		888
Other costs		47		366		1,056			47
Total restructuring and other costs	$	7,228	$	8,720	$	15,557		$	7,228

We expect to continue to incur costs related to the restructuring of our operations in order to achieve cost savings and the targeted synergies related to our ~~business combinations.~~acquisitions. However, the timing and the amount of these costs depends on various factors, including, but not limited to, identifying and realizing synergy opportunities and executing the integration of our combined operations. We may also continue to incur additional restructuring and other costs during ~~2021~~2022 and beyond related to our ForwardBound margin enhancement initiative.

Total depreciation and amortization expense was ~~$57.9~~$62.2 million and ~~$56.1~~$57.9 million for the three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, respectively. The increase in total depreciation and amortization expense in the current year compared to the prior year period was primarily due to ~~depreciation~~vehicle fleet leases, internal-use software, and ~~amortization from the acquisitions that were completed in the fourth quarter of 2020, partially offset by a decrease due to fully amortized~~ intangible assets from ~~prior~~recent acquisitions.

	Three Months Ended March 31,											Three Months Ended March 31,
	2021			2020			Change					2022			2021			Change
Interest income	$	(71	)	$	(336	)	$	265		(78.9	)%	$	(3	)	$	(71	)	$	68			95.8	%
Interest expense		23,328			26,458			(3,130	)	(11.8	)%		15,765			23,328			(7,563	)		(32.4	)%
Loss on extinguishment of debt		603			—			603		100.0	%		—			603			(603	)		(100.0	)%
Other income, net		(9,856	)		(18,930	)		9,074		(47.9	)%
Other expense (income), net													4,642			(9,856	)		14,498		n/m
Total other expense, net	$	14,004		$	7,192		$	6,812		94.7	%	$	20,404		$	14,004		$	6,400			45.7	%

Total other expense, net was ~~$14.0~~$20.4 million and ~~$7.2~~$14.0 million for the three months ended March 31, 2022 and 2021, ~~and 2020,~~ respectively. The decrease in interest expense was primarily due to reductions in our higher interest rate debt as a result of debt prepayments and refinancing transactions as well as lower interest rates on our variable interest rate debt. Due to market forecasts for the London Inter-bank Offered Rate (“LIBOR”), we believe we may experience higher interest expense relative to the first quarter for the remainder of the year. Other ~~income,~~expense (income), net primarily consists of foreign currency gains and losses that result from exchange rate fluctuations on our monetary asset balances denominated in currencies other than our functional ~~currency.~~currency and other gains and losses related to investments.

For the three months ended March 31, 2022, we recorded income tax expense of $7.3 million, compared to pre-tax income of $53.5 million. Income tax expense for the three months ended March 31, 2022 included a discrete tax benefit of $6.1 million primarily related to excess tax benefits from share-based compensation. The effective tax rate for the three months ended March 31, 2022, excluding discrete items, varied from the U.S. federal statutory income tax rate of 21.0% primarily due to foreign income inclusions such as the Global Intangible Low-Taxed Income (“GILTI”) provisions, state and local taxes on U.S. income, and research and development credits.

For the three months ended March 31, 2021,, we recorded income tax expense of $8.3 million, compared to pre-tax income of $47.0 million. Income tax expense for the three months ended March 31, 2021 included a discrete tax benefit of $3.6 million, primarily related to excess tax benefits from share-based compensation. The effective tax rate for the three months ended March 31, 2021, excluding discrete items, varied from the U.S. federal statutory income tax rate of 21.0% primarily ~~due~~due to foreign income inclusions such as the ~~Global Intangible Low-Taxed Income (“GILTI”)~~GILTI provisions, foreign tax credits, and state and local taxes on U.S. income.

~~For the three months ended March 31, 2020, we recorded income tax expense of $8.2 million, compared to pre-tax income~~ ~~of $41.8 million. The effective tax rate for the three months ended March 31, 2020 varied from the U.S. federal~~ ~~statutory income tax rate of 21.0% primarily due to foreign income inclusions such as the GILTI provisions, state and local taxes on U.S. income, and research and general business credits.~~

We currently maintain a valuation allowance against a portion of our state deferred tax assets and a portion of our foreign deferred tax assets as of March 31, ~~2021.~~2022. We intend to continue to maintain a valuation allowance on these deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances.

	March 31, 2021		December 31, 2020		March 31, 2022		December 31, 2021
Balance sheet statistics:
Cash and cash equivalents	$	264,424	$	271,901	$	119,040	$	106,363
Restricted cash		265		272		111		112
Working capital (excluding restricted cash)		141,828		160,409		153,766		112,228

As of March 31, ~~2021,~~2022, we had ~~$264.7~~$119.2 million of cash, cash equivalents, and restricted cash. As of March 31, ~~2021, the majority~~2022, substantially all of our cash, cash equivalents, and restricted cash was held within the ~~United States.~~U.S. In addition, we had ~~$583.9~~$455.8 million (net of ~~$16.1~~$14.2 million in outstanding letters of credit (“LOCs”)) available for borrowing under our revolving credit facility (the “Revolver”), of which ~~$133.9~~$135.8 million was available for LOCs.

We have historically funded our operations and growth, including acquisitions, primarily with our working capital, cash flow from operations, and funds available through various borrowing arrangements. Our principal liquidity requirements are to fund our debt service obligations, capital expenditures, expansion of service offerings, possible acquisitions, integration and restructuring costs, geographic expansion, stock repurchases, working capital, and other general corporate expenses. Cash flow from operations also could be affected by various risks and uncertainties, including, but not limited to, the effects of the COVID-19 pandemic on the global economy and major financial markets, as well as other risks detailed in Part I, Item 1A, “Risk Factors” in our ~~Annual Report on~~2021 Form 10-K ~~for the fiscal year ended December 31, 2020~~. Based on past performance and current expectations, we believe our cash and cash equivalents, cash generated from operations, and funds available under the Revolver will be sufficient to meet our working capital needs, capital expenditures, scheduled debt and interest payments, income tax obligations, and other currently anticipated liquidity requirements for at least the next 12 months.

As of March 31, ~~2021,~~2022, we had approximately ~~$2.92~~$2.98 billion of total principal indebtedness (including ~~$44.6~~$62.2 million in finance lease obligations), consisting of ~~$1.91~~$1.79 billion in term loan debt, $130.0 million under our Revolver, $600.0 million of ~~3.625%~~ senior notes (the “Notes”), and ~~$365.0~~$400.0 million in borrowings against our accounts receivable financing agreement. ~~Approximately $810.8 million~~ See “Note 4 – Long-Term Debt Obligations” of our ~~indebtedness (excluding finance leases) was subject to variable interest rates.~~

~~On November 24, 2020, we completed the issuance and sale~~unaudited condensed consolidated financial statements in Part I, Item 1 of $600.0 million aggregate principal amount of the Notes. The Notes were issued pursuant to an indenture (the “Indenture”), which provides, among other things, that the Notes are senior unsecured obligations of us and are guaranteed, jointly and severally,this Quarterly Report on ~~a senior unsecured basis, by certain of our subsidiaries.~~

We may redeem some or all of the Notes at any time prior to January 15, 2024 at a redemption price equal to 100% of the aggregate principal amount of the Notes to be redeemed plus a “make-whole” premium and accrued and unpaid interest. In addition, prior to July 15, 2023, we may redeem up to 40% of the original principal amount of the Notes with proceeds of certain equity offerings at a redemption price equal to 103.625% of the aggregate principal amount of such Notes plus accrued and unpaid interest. On or after January 15, 2024, we may redeem some or all of the Notes at the redemption prices set forth in the Indenture plus accrued and unpaid interest. The Indenture contains covenants that limit the ability of us and our restricted subsidiaries to, among other things, (1) incur additional liens, (2) engage in certain sale and leaseback transactions, and (3) conduct mergers, consolidations, or asset sales. These covenants are subject to exceptions and qualifications set forth in the Indenture.

If we sell certain of our assets or experience specific kinds of changes of control, we are required to offer to repurchase the Notes at a repurchase price equal to (1) par plus any accrued and unpaid interest in the case of an asset sale or (2) 101% of the aggregate principal amount thereof plus any accrued and unpaid interest in the case of a change of control.

~~We are party to a credit agreement (as amended, the “Credit Agreement”) that includes a $1.55 billion Term Loan A facility (“Term Loan A”)~~ ~~that has two tranches, tranche one that matures on March 26, 2024 and tranche two that matures on August 1, 2024, a $1.60 billion Term Loan B facility (“Term Loan B”) that matures on August 1, 2024, and a $600.0 million Revolver that matures on August 1, 2024.~~ ~~The Revolver includes LOCs with a sublimit of $150.0 million.~~

In February 2021, as a result of our First Lien Leverage Ratio (as defined in the Credit Agreement) being less than or equal to 2.5x, the Adjusted Eurocurrency Rate Spread (as defined in the Credit Agreement) on Term Loan A and the Revolver decreased from 1.50% to 1.25%.

During the three months ended March 31, 2021, we made $41.8 million and $64.1 million of voluntary prepayments against Term Loan A and Term Loan B, respectively, which were applied to future principal payments. As a result of these and previous voluntary prepayments, we are not required to make a mandatory payment against the principal balance of Term Loan A until October 2022 ~~and Term Loan B until maturity in August 2024.~~

~~Our ability to make payments on our indebtedness and to fund planned capital expenditures~~ and necessary working capital will depend on our ability to generate cash in the future. Our ability to meet our cash needs through cash flows from operations will depend on the demand for our services,Form 10-Q as well as general economic, financial, competitive, and other factors, many of which are beyond our control, including the broad effects of the COVID-19 pandemic on the global economy and major financial markets. Our business may not generate cash flow in an amount sufficient to enable us to pay the principal of, or interest on, our indebtedness, or to fund our other liquidity needs, including working capital, capital expenditures, acquisitions, investments, and other general corporate requirements. If we cannot fund our liquidity needs, we will have to take actions such as reducing or delaying capital expenditures, acquisitions or investments, selling assets, restructuring or refinancing our debt, reducing the scopePart II, Item 7 of our ~~operations and growth plans, or seeking~~2021 Form 10-K for additional ~~capital. We cannot assure you that any of these remedies could, if necessary, be affected on commercially reasonable terms, or at all, or that they would permit us to meet~~details regarding our ~~scheduled~~long-term debt service obligations. The Credit Agreement contains covenant restrictions that limit our ability to direct the use of proceeds from any disposition of assets and, as a result, we may not be allowed to use the proceeds from any such dispositions to satisfy all currentarrangements.

~~Our Credit Agreement contains usual and~~arrangements contain customary restrictive ~~covenants. Our Credit Agreement requires us to maintain a maximum First Lien Leverage Ratio (as defined in the Credit Agreement) of no more than 4.5 to 1.0~~covenants and, as ~~of the last day of each fiscal quarter from and after March 31, 2020.~~

The Indenture also contains customary events of default, including (1) failure to make required payments, (2) failure to comply with certain covenants, (3) failure to pay certain other indebtedness, (4) certain events of bankruptcy and insolvency, and (5) failure to pay certain judgments. An event of default under the Indenture allows either the Trustee or the holders of at least 25% in aggregate principal amount of the Notes, as applicable, issued under such Indenture, to accelerate the amounts due under the Notes, or in the case of a bankruptcy or insolvency, will automatically cause the acceleration of the amounts due under the Notes.

As of March 31, ~~2021,~~2022, we were in ~~compliance~~compliance with all applicable debt covenants.

The Revolver includes LOCs with a sublimit of $150.0 million. As of March 31, 2021, there were no outstanding Revolver borrowings and $16.1 million of LOCs outstanding, leaving $583.9 million of available borrowings under the Revolver, including $133.9 million available for LOCs.

We have an accounts receivable financing agreement (as amended) with a termination date of October 3, 2022, unless terminated earlier pursuant to its terms. On January 28, 2021, we amended our accounts receivable financing agreement to increase the amount we can borrow from $300.0 million to $365.0 million, and drew down the additional $65.0 million to partially fund the Term Loan A and Term Loan B voluntary prepayments. Accordingly, ~~there was no incremental impact on the outstanding principal of our debt.~~ ~~As of March 31, 2021, we had $365.0 million of outstanding borrowings under this agreement with no remaining borrowing capacity available.~~

We have entered into various interest rate swaps to mitigate our exposure to changes in interest rates on our term ~~loans.~~loan. As of March 31, ~~2021,~~2022, the percentage of our total principal debt (excluding finance leases) that is subject to fixed interest rates was approximately ~~72%~~59%. Each quarter-point increase or decrease in the applicable floating interest rate atas of March 31, ~~2021~~2022 would change our annual interest expense by approximately ~~$2.0~~$3.0 million.

~~On November 17, 2020, our Board authorized~~During the repurchase of up to an aggregate of $300.0 million of our Class A common stock, par value $0.01 per share, to be executed from time to time in open market transactions effected through a broker at prevailing market prices, in block trades, or through privately negotiated transactions through Decemberthree months ended March 31, 2022, (the “Stock Repurchase Program”). The Stock Repurchase Program took effect on January 1, 2021. Share repurchases are funded primarily with our working capital, cash flow from operations, and funds available through various borrowing arrangements.

~~The Stock Repurchase Program does not obligate us to repurchase any particular amount~~we repurchased 1,928,923 shares of our common stock and may be modified, extended, suspended, or discontinued at any time. The timing and amount of repurchases are determined by our management based on a variety of factors such as the market price of our common stock, our corporate cash requirements, and overall market conditions. The Stock Repurchase Program is subject to applicable legal requirements, including federal and state securities laws ~~and applicable Nasdaq rules~~. We may also repurchase shares of our Class A common stock pursuant to a trading plan meeting the requirements of Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, which would permit shares of our Class A common stock to be repurchased when we might otherwise be precluded from doing so by law.

~~The following table sets forth repurchase activity~~for $150.0 million under the Stock Repurchase ~~Program from inception through March 31, 2021:~~Program. See “Note 8 – Shareholders’ Equity” of our unaudited condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for additional details regarding the Stock Repurchase Program.

As of March 31, ~~2021,~~2022, we had remaining authorization to repurchase up to approximately ~~$255.5~~$32.5 million of shares of our common stock under the Stock Repurchase Program.

Our cash flows from operating, investing, and financing activities were as follows (in thousands):

Cash flows provided by operating activities ~~increased~~decreased by ~~$165.7~~$56.2 million during the three months ended March 31, ~~2021~~2022 compared to ~~cash flows used in operating activities during~~ the three months ended March 31, ~~2020.~~2021. The ~~increase~~decrease is primarily due to ~~higher cash-related net income and positive~~negative changes in operating assets and liabilities relative to the prior year ~~period.~~period, partially offset by higher cash-related net income. Fluctuations in accounts receivable, unbilled services (including contract assets), and deferred revenue occur on a regular basis as we perform services, achieve milestones or other billing criteria, send invoices to customers, and collect outstanding accounts receivable. This activity varies by individual customer and contract. We attempt to negotiate payment terms that provide for payment of services prior to or soon after the provision of services, but the levels of accounts receivable, unbilled services (including contract assets), and deferred revenue can vary significantly from period to period.

For the three months ended March 31, ~~2021,~~2022, we used ~~$19.8~~$25.5 million in cash for investing activities, which ~~consisted of $10.0 millionof payments related to the acquisitions that were completed in the fourth quarter of 2020 and $11.2~~included $23.5 million for purchases of property and ~~equipment, partially offset by $1.4 million of proceeds from unconsolidated affiliates.~~equipment. We continue to closely monitor our capital expenditures ~~especially in light of the COVID-19 pandemic,~~ while making strategic investments in the development of our information technology infrastructure to meet the needs of our workforce, enable efficiencies, reduce business continuity risks, and conform to changes in governing rules and regulations.

For the three months ended March 31, ~~2020~~2021, we used $~~18.6~~19.8 million in cash for investing activities, which consisted of ~~$11.9~~$10.0 million of payments related to the acquisitions that were completed in the fourth quarter of 2020 and $11.2 million for purchases of property and equipment, ~~and $6.7~~partially offset by $1.4 million ~~for investments in~~of proceeds from unconsolidated affiliates.

For the three months ended March 31, ~~2021,~~2022, we used ~~$111.4~~$36.6 million in cash for financing activities, which consisted primarily of repurchases of our common stock and payments related to tax withholdings for share-based compensation. These payments were partially funded by proceeds from our Revolver.

For the three months ended March 31, 2021, we used $111.4 millionin cash for financing activities, which consisted primarily of repayment of long-term debt, repurchases of our common stock, and payments related to tax withholdings for share-based compensation. These payments were partially offset by proceeds from our accounts receivable financing ~~arrangement.~~

~~For the~~ ~~three months ended March 31, 2020, our financing activities provided~~ ~~$229.9 millionin cash, which consisted primarily of a $300.0 million draw down of our Revolver, partially offset by repurchases of our common stock and contingent consideration payments.~~agreement.

The preparation of financial statements in conformity with GAAP requires management to make estimates, judgments, and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses during the period, as well as disclosures of contingent assets and liabilities at the date of the financial statements. We evaluate our estimates on an ongoing basis, including those related to revenue recognition, valuation of goodwill and identifiable intangibles, and tax-related contingencies and valuation allowances. These estimates are based on the information available to management at the time these estimates, judgments, and assumptions are made. Actual results may differ materially from these estimates. There have been no significant changes to our critical accounting policies and estimates. For additional information on all of our critical accounting policies and estimates, refer to Part II -– Item 7 -– Management’s Discussion and Analysis included in our ~~Annual Report on~~2021 Form ~~10-K for the fiscal year ended December 31, 2020.~~10-K.

There have been no material changes to our quantitative and qualitative disclosures about market risk as compared to the quantitative and qualitative disclosures about market risk described in our ~~Annual Report on~~2021 Form ~~10-K for the fiscal year ended~~ ~~December 31, 2020~~.10-K.

Our management, with the participation of our CEO and CFO, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, our CEO and CFO have concluded that as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

There have been no changes in our internal control over financial reporting identified in management’s evaluation pursuant to Rules 13a-15(d) or 15d-15(d) of the Exchange Act during the period covered by this Quarterly Report on Form 10-Q that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

We are party to legal proceedings incidental to our business. While our management currently believes the ultimate outcome of these proceedings, individually and in the aggregate, will not have a material adverse effect on our consolidated financial statements, litigation is subject to inherent uncertainties. Were an unfavorable ruling to occur, there exists the possibility of a material adverse impact on our financial condition and results of operations.

Please refer to “Note 16 – Commitments and Contingencies” of our unaudited condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for additional material developments to legal proceedings included in our ~~Annual Report on~~2021 Form ~~10-K for the fiscal year ended December 31, 2020.~~10-K.

There have been no material changes from the risk factors previously disclosed in our ~~Annual Report on~~2021 Form ~~10-K for the year ended~~ ~~December 31, 2020. Refer to “Risk Factors” in Part 1, Item 1A of that report for~~10-K. For a detailed discussion of risk factors affecting ~~us.~~us, refer to Part I, Item 1A, “Risk Factors” in that report.

Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities.

During the three months ended March 31, 2021, we repurchased 600,000 shares of our Class A common stock, $0.01 par value per share in a private transaction under our previously announced stock repurchase program described below, for a total purchase price of approximately $44.5 million, or $74.18 per share. As of March 31, ~~2021,~~2022, we have remaining authorization to repurchase up to approximately ~~$255.5~~$32.5 million of shares of our Class A common stock under the Stock Repurchase Program.

Period

Total number of shares purchased

Average price paid per share

Total number of shares purchased as part of publicly announced plans or programs (1)

Approximate dollar value of shares that may yet be purchased under the plans or programs (in thousands)

January 1, 2021 - January 31, 2021

—

$
—

—

$
300,000

February 1, 2021 - February 28, 2021

—

$
—

—

$
300,000

March 1, 2021 - March 31, 2021

600,000

$
74.18

600,000

$
255,495

600,000

600,000

Period	Total number of shares purchased		Average price paid per share		Total number of shares purchased as part of publicly announced plans or programs (1)		Approximate dollar value of shares that may yet be purchased under the plans or programs (in thousands)
January 1, 2022 - January 31, 2022		—	$	—		—	$	182,479
February 1, 2022 - February 28, 2022		515,003	$	78.52		515,003	$	142,040
March 1, 2022 - March 31, 2022		1,413,920	$	77.46		1,413,920	$	32,518
		1,928,923				1,928,923

(1) On November 17, 2020, the Board authorized the repurchase of up to an aggregate of $300.0 million of our Class A common stock, par value $0.01 per share, to be executed from time to time in open market transactions effected through a broker at prevailing market prices, in block trades, or through privately negotiated transactions through December 31, 2022 (the “Stock Repurchase Program”). The Stock Repurchase Program took effect on January 1, 2021. Share repurchases are funded primarily with our working capital, cash flow from operations, and funds available through various borrowing arrangements. The Stock Repurchase Program does not obligate us to repurchase any particular amount of our Class A common stock, and may be modified, extended, suspended, or discontinued at any time. The timing and amount of repurchases are determined by our management based on a variety of factors such as the market price of our Class A common stock, our corporate cash requirements, and overall market conditions. The Stock Repurchase Program is subject to applicable legal requirements, including federal and state securities laws and applicable Nasdaq ~~rules~~.rules. We may also repurchase shares of our Class A common stock pursuant to a trading plan meeting the requirements of Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, which would permit shares of our Class A common stock to be repurchased when we might otherwise be precluded from doing so by law.

We immediately retired all of the repurchased common stock and charged the par value of the shares to common stock. The excess of the repurchase price over the par value was applied on a pro rata basis against additional paid-in capital, with the remainder applied to accumulated deficit.

Incorporated by Reference
(Unless Otherwise Indicated)
Exhibit
Number

Exhibit Description
Form
File No.
Exhibit
Filing Date
10.1

Fifth Amendment to the Purchase and Sale Agreement, dated as of January 22, 2021, among each of the entities listed on the signature pages hereto as an Originator, Syneos Health, LLC, as services, and Syneos Health Receivables LLC.
10-K
001-36730
10.16.5
February 18, 2021
10.2

Tenth Amendment to the Receivables Financing Agreement, dated as of January 22, 2021, by and among Syneos Health Receivables LLC, as borrower, Syneos Health, LLC, as initial services, Regions Bank, as a lender, and PNC Bank, National Association, as administrative agent and as a lender.
10-K
001-36730
10.17.11
February 18, 2021
10.3

Share Repurchase Agreement, dated February 26, 2021, by and among Syneos Health, Inc. and certain selling stockholders named therein.
8-K
001-36730
10.1
March 3, 2021
10.4

Form of Global Performance Restricted Stock Unit Award Agreement under Syneos Health, Inc. 2018 Equity Incentive Plan (U.S. Participants).
8-K
001-36730
10.1
January 21, 2021
10.5

Form of Global Performance Restricted Stock Unit Award Agreement under Syneos Health, Inc. 2018 Equity Incentive Plan (Non-U.S. Participants).
8-K
001-36730
10.2
January 21, 2021
31.1

Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
—
—
—
Filed herewith
31.2

Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
—
—
—
Filed herewith
32.1

Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
—
—
—
Furnished herewith
32.2

Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
—
—
—
Furnished herewith
101.INS

Inline XBRL Instance Document - the Instance Document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document.
—
—
—
Filed herewith
101.SCH

Inline XBRL Taxonomy Extension Schema Document.
—
—
—
Filed herewith
101.CAL

Inline XBRL Taxonomy Extension Calculation Linkbase Document.
—
—
—
Filed herewith
101.DEF

Inline XBRL Taxonomy Extension Definition Linkbase Document.
—
—
—
Filed herewith
101.LAB

Inline XBRL Taxonomy Extension Label Linkbase Document.
—
—
—
Filed herewith
101.PRE

Inline Taxonomy Extension Presentation Linkbase Document.
—
—
—
Filed herewith
104

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
—
—
—
Filed herewith


		Incorporated by Reference (Unless Otherwise Indicated)
Exhibit Number	Exhibit Description	Form	File No.	Exhibit	Filing Date
4.1	Fourth Supplemental Indenture, dated as of April 5, 2022, among the Guaranteeing Subsidiaries, the Company, the other Guarantors, and Wells Fargo Bank, National Association, as trustee.	—	—	—	Filed herewith
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.	—	—	—	Filed herewith
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.	—	—	—	Filed herewith
32.1	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.	—	—	—	Furnished herewith
32.2	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.	—	—	—	Furnished herewith
101.INS	Inline XBRL Instance Document - the Instance Document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document.	—	—	—	Filed herewith
101.SCH	Inline XBRL Taxonomy Extension Schema Document.	—	—	—	Filed herewith
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document.	—	—	—	Filed herewith
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document.	—	—	—	Filed herewith
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document.	—	—	—	Filed herewith
101.PRE	Inline Taxonomy Extension Presentation Linkbase Document.	—	—	—	Filed herewith
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).	—	—	—	Filed herewith

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, thereunto duly authorized.


Delaware		27-3403111
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock, $0.01 par value per share	SYNH	The Nasdaq Stock Market LLC

	PART I - FINANCIAL INFORMATION

		Page

Item 1.	Financial Statements	3

	Condensed Consolidated Statements of Income for the three months ended March 31, ~~2021~~2022 and ~~2020~~2021 (unaudited)	3

	Condensed Consolidated Statements of Comprehensive Income ~~(Loss)~~ for the three months ended March 31, ~~2021~~2022 and ~~2020~~2021 (unaudited)	4

	Condensed Consolidated Balance Sheets as of March 31, ~~2021~~2022 and December 31, ~~2020~~2021 (unaudited)	5

	Condensed Consolidated Statements of Cash Flows for the three months ended March 31, ~~2021~~2022 and ~~2020~~2021 (unaudited)	6

	Condensed Consolidated Statements of Shareholders’ Equity for the three months ended March 31, ~~2021~~2022 and ~~2020~~2021 (unaudited)	7

	Notes to Condensed Consolidated Financial Statements (unaudited)	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2524

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3834

Item 4.	Controls and Procedures	3834

	PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	3835

Item 1A.	Risk Factors	3835

Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities	3835

Item 5.	Other Information	3936

Item 6.	Exhibits	4037

	Signature	4138

	Three Months Ended March 31,
	2021			2020
Net realized foreign currency loss (gain)	$	1,192		$	(5,096	)
Net unrealized foreign currency gain		(9,522	)		(15,019	)
Other, net		(1,526	)		1,185
Total other income, net	$	(9,856	)	$	(18,930	)

	Three Months Ended March 31,
	2022		2021
Net realized foreign currency loss	$	2,456	$	1,192
Net unrealized foreign currency loss (gain)		434		(9,522	)
Equity investment income		—		(1,100	)
Other, net		1,752		(426	)
Total other expense (income), net	$	4,642	$	(9,856	)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

	Clinical Solutions (a)		Commercial Solutions (b)			Total
Balance as of December 31, 2020	$	3,216,335	$	1,559,843		$	4,776,178
Business combinations (c)		2,479		—			2,479
Impact of foreign currency translation and other (d)		49,079		(47,557	)		1,522
Balance as of March 31, 2021	$	3,267,893	$	1,512,286		$	4,780,179

		SYNEOS HEALTH, INC.


Date: April 28, ~~2021~~2022	BY:	/s/ Jason Meggs
		Jason Meggs
		Chief Financial Officer (Principal Financial Officer)