Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 30, 2017 | Jun. 30, 2016 | |
Document And Entity Information [Abstract] | |||
Entity Registrant Name | NantHealth, Inc. | ||
Entity Central Index Key | 1,566,469 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 121,626,568 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 446.6 |
Consolidated and Combined Balan
Consolidated and Combined Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets | ||
Cash and cash equivalents | $ 160,353 | $ 5,989 |
Marketable securities | 0 | 1,243 |
Accounts receivable, net | 13,728 | 11,472 |
Inventories | 2,217 | 2,146 |
Deferred implementation costs | 3,336 | 2,224 |
Related party receivables, net | 899 | 1,245 |
Prepaid expenses and other current assets | 5,046 | 8,707 |
Total current assets | 185,579 | 33,026 |
Property, plant, and equipment, net | 29,139 | 13,899 |
Deferred implementation costs, net of current | 7,910 | 1,930 |
Goodwill | 131,068 | 56,718 |
Intangible assets, net | 119,126 | 54,971 |
Investment in related party | 207,197 | 248,191 |
Related party receivable, net of current | 1,971 | 1,300 |
Other assets | 2,317 | 1,918 |
Total assets | 684,307 | 411,953 |
Current liabilities | ||
Accounts payable | 6,720 | 6,447 |
Accrued and other current liabilities | 25,231 | 15,967 |
Deferred revenue | 17,216 | 10,656 |
Related party payables, net | 8,082 | 10,166 |
Total current liabilities | 57,249 | 43,236 |
Deferred revenue, net of current | 17,238 | 17,312 |
Related party liabilities | 5,612 | 0 |
Related party promissory note | 112,666 | 0 |
Related party convertible note, net | 7,564 | 0 |
Convertible notes, net | 70,810 | 0 |
Deferred income taxes, net | 754 | 0 |
Other liabilities | 820 | 358 |
Total liabilities | 272,713 | 60,906 |
Commitments and Contingencies | ||
Redeemable Series F units: 53,580,996 units issued and outstanding at December 31, 2015 | 0 | 166,042 |
Stockholders' / members' equity | ||
Members' equity, 541,228,171 units issued and outstanding at December 31, 2015 | 476,263 | |
Common stock, $0.0001 par value per share, 750,000,000 shares authorized; 121,250,437 shares issued and outstanding at December 31, 2016 (Including 6,976 restricted stock) | 12 | |
Preferred stock, $0.0001 par value per share, 20,000,000 shares authorized; no shares issued and outstanding at December 31, 2016 | 0 | |
Additional paid-in capital | 886,334 | 0 |
Accumulated deficit | (475,273) | (291,171) |
Accumulated other comprehensive income (loss) | 521 | (87) |
Total stockholders' / members' equity | 411,594 | 185,005 |
Total liabilities and stockholders' / members' equity | $ 684,307 | $ 411,953 |
Consolidated and Combined Bala3
Consolidated and Combined Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Redeemable Series F units issued (units) | 53,580,996 | |
Redeemable Series F units outstanding (units) | 53,580,996 | |
Members' equity units issued (units) | 541,228,171 | |
Members' equity units outstanding (units) | 541,228,171 | |
Common stock, par value (usd per share) | $ 0.0001 | |
Common stock authorized (shares) | 750,000,000 | |
Common stock issued (shares) | 121,250,437 | |
Common stock outstanding (shares) | 121,250,437 | |
Preferred stock, par value (usd per share) | $ 0.0001 | |
Preferred stock authorized (shares) | 20,000,000 | |
Preferred stock issued (shares) | 0 | |
Preferred stock outstanding (shares) | 0 |
Consolidated and Combined State
Consolidated and Combined Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||||
Revenue: | ||||||
Software and hardware | $ 8,242 | $ 14,616 | $ 8,372 | |||
Software–as-a-service | 58,359 | 20,734 | 9,778 | |||
Total software-related revenue | 66,601 | 35,350 | 18,150 | |||
Maintenance | 14,238 | 10,452 | 5,345 | |||
Sequencing and molecular analysis | 604 | 75 | 0 | |||
Other services | 18,937 | 12,427 | 10,426 | |||
Total net revenue | 100,380 | 58,304 | 33,921 | |||
Cost of Revenue: | ||||||
Software and hardware | 1,834 | 90 | 1,025 | |||
Software-as-a-service | 24,713 | 7,019 | 8,026 | |||
Total software-related cost of revenue | 26,547 | 7,109 | 9,051 | |||
Maintenance | 2,750 | 1,874 | 438 | |||
Sequencing and molecular analysis | 1,987 | 39 | 0 | |||
Other services | 25,462 | 15,202 | 7,047 | |||
Amortization of developed technologies | 15,588 | 10,585 | 7,694 | |||
Total cost of revenue | 72,334 | 34,809 | 24,230 | |||
Gross profit | 28,046 | 23,495 | 9,691 | |||
Operating Expenses: | ||||||
Selling, general and administrative | 120,653 | 69,021 | 46,209 | |||
Research and development | 61,637 | 23,835 | 16,979 | |||
Amortization of software license and acquisition-related assets | 7,257 | 1,542 | 7,033 | |||
Impairment of intangible asset | 0 | 0 | 24,150 | |||
Total operating expenses | 189,547 | 94,398 | 94,371 | |||
Loss from operations | (161,501) | (70,903) | (84,680) | |||
Interest expense, net | (6,340) | (627) | (980) | |||
Other income (expense), net | 1,922 | 2,508 | (477) | |||
(Loss) income from related party equity method investments | (40,994) | (2,584) | 1,525 | |||
Loss before income taxes | (206,913) | (71,606) | (84,612) | |||
Provision for (benefit from) income taxes | (22,811) | 405 | 5 | |||
Net loss | (184,102) | (72,011) | (84,617) | |||
Less: Net loss attributed to non-controlling interests | 0 | 0 | (192) | |||
Net loss | $ (184,102) | $ (72,011) | $ (84,425) | |||
Common Stock | ||||||
Net income (loss) per share (1): | ||||||
Basic and diluted (usd per share) | [1] | $ (1.69) | [2] | $ (0.99) | [2] | $ (1.13) |
Weighted average shares outstanding (1): | ||||||
Basic and diluted (shares) | [1] | 111,600,650 | 88,970,842 | 74,505,127 | ||
Redeemable Common Stock | ||||||
Net income (loss) per share (1): | ||||||
Basic and diluted (usd per share) | [1] | $ 0.99 | $ 1.50 | |||
Weighted average shares outstanding (1): | ||||||
Basic and diluted (shares) | [1] | 5,005,855 | 10,714,285 | |||
[1] | The net income (loss) per share and weighted-average shares outstanding have been computed to give effect to the LLC Conversion (See Note 16) that occurred on June 1, 2016, prior to the Company’s initial public offering ("IPO"). In conjunction with the LLC Conversion, (a) all of the Company’s outstanding units automatically converted into shares of common stock, based on the relative rights of the Company's pre-IPO equityholders as set forth in the Company's limited liability company agreement and (b) the Company adopted and filed a certificate of incorporation with the Secretary of State of the state of Delaware and adopted bylaws. The Company adopted and filed an amendment to its certificate of incorporation with the Secretary of State of the state of Delaware to effect a 1-for-5.5 reverse stock split of its common stock on June 1, 2016. See Note 20 for the calculation of net income (loss) per share for common stock and redeemable common stock for the years ended December 31, 2016, 2015 and 2014. | |||||
[2] | The net income (loss) per share for the common stock for the years ended December 31, 2016 and 2015 reflects $4,958 and $16,042 in accretion value allocated to the redeemable common stock, respectively. The redeemable common stock contained a put right, which expired unexercised on June 20, 2016. As a result of and as of that date, the shares were no longer redeemable and were included in common stock. |
Consolidated and Combined Stat5
Consolidated and Combined Statements of Operations - Footnote $ in Thousands | Jun. 01, 2016 | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) |
Income Statement [Abstract] | ||||
Reverse stock split, conversion ratio | 0.1818 | |||
Accretion to redemption value | $ 4,958 | $ 16,042 | $ 0 |
Consolidated and Combined Stat6
Consolidated and Combined Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (184,102) | $ (72,011) | $ (84,617) |
Other comprehensive income (loss), net of reclassification adjustments and income taxes: | |||
Foreign currency translation gains (losses) | 608 | (136) | 49 |
Net changes related to available for sale securities: | |||
Remeasurement of investment in NDO to fair value | 0 | 0 | 172 |
Reclassification of losses to net income | 0 | 0 | 332 |
Total net changes related to available for sale securities | 0 | 0 | 504 |
Total other comprehensive income (loss) | 608 | (136) | 553 |
Comprehensive loss | (183,494) | (72,147) | (84,064) |
Less: Comprehensive loss attributed to non-controlling interests | 0 | 0 | (192) |
Comprehensive loss attributed to NantHealth | $ (183,494) | $ (72,147) | $ (83,872) |
Consolidated and Combined Stock
Consolidated and Combined Stockholders' / Members' Equity - USD ($) $ in Thousands | Total | Members' Equity | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (loss) | Total NantHealth Equity | Non-controlling interests |
Beginning balance, units at Dec. 31, 2013 | 425,782,531 | |||||||
Beginning balance, members' equity at Dec. 31, 2013 | $ 155,914 | |||||||
Beginning balance, shares at Dec. 31, 2013 | 0 | |||||||
Beginning balance, including noncontrolling interest at Dec. 31, 2013 | $ 20,657 | $ 0 | $ 0 | $ (134,735) | $ (504) | $ 20,675 | $ (18) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of membership interests, units | 43,052,311 | |||||||
Issuance of membership interests | 110,525 | $ 110,525 | 110,525 | |||||
Acquisition of NDO, units | 6,905,566 | |||||||
Acquisition of NDO | 16,951 | $ 16,619 | 332 | 16,951 | ||||
Sale of former subsidiary | 5,439 | 5,439 | 5,439 | |||||
Sale of related party equity method investment | 102 | $ 102 | 102 | |||||
Transactions with non-controlling interests, units | 2,764,908 | |||||||
Transactions with non-controlling interests | (4,817) | $ (4,892) | (4,892) | 75 | ||||
Stock-based compensation expense (pre LLC conversion), units | 2,519,362 | |||||||
Stock-based compensation expense (pre LLC conversion) | 340 | $ 205 | 205 | 135 | ||||
Redeemable common stock put right expiration | 0 | |||||||
Other comprehensive income | 221 | 221 | 221 | |||||
Net loss | (84,617) | (84,425) | (84,425) | (192) | ||||
Ending balance, units at Dec. 31, 2014 | 481,024,678 | |||||||
Ending balance, members' equity at Dec. 31, 2014 | $ 283,912 | |||||||
Ending balance, shares at Dec. 31, 2014 | 0 | |||||||
Ending balance, attributable to parent at Dec. 31, 2014 | 64,801 | $ 0 | 0 | (219,160) | 49 | 64,801 | 0 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of membership interests, units | 59,367,813 | |||||||
Issuance of membership interests | 200,774 | $ 200,774 | 200,774 | |||||
Stock-based compensation expense (pre LLC conversion), units | 835,680 | |||||||
Stock-based compensation expense (pre LLC conversion) | 1,429 | $ 1,429 | 1,429 | |||||
Deemed capital contributions from Chairman and CEO (pre LLC conversion | 6,190 | 6,190 | 6,190 | |||||
Series F put right accretion (pre LLC conversion) | (16,042) | $ (16,042) | ||||||
Redeemable common stock put right expiration | 0 | |||||||
Other comprehensive income | (136) | (136) | (136) | |||||
Net loss | (72,011) | (72,011) | (72,011) | |||||
Ending balance, units at Dec. 31, 2015 | 541,228,171 | |||||||
Ending balance, members' equity at Dec. 31, 2015 | $ 476,263 | |||||||
Ending balance, shares at Dec. 31, 2015 | 0 | |||||||
Ending balance, attributable to parent at Dec. 31, 2015 | 185,005 | $ 0 | 0 | (291,171) | (87) | 185,005 | 0 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of membership interests, units | 15,513,726 | |||||||
Issuance of membership interests | 52,500 | $ 52,500 | 52,500 | |||||
Stock-based compensation expense (pre LLC conversion) | 170 | 170 | 170 | |||||
Deemed capital contributions from Chairman and CEO (pre LLC conversion | 830 | 830 | 830 | |||||
Series F put right accretion (pre LLC conversion) | (4,375) | $ (4,375) | (4,375) | |||||
Conversion of members' interests, units | (556,741,897) | |||||||
Conversion of members' interests | $ (525,388) | |||||||
Conversion of members' interests, shares | 99,661,906 | |||||||
Conversion of members' interests | 0 | $ 10 | 525,378 | |||||
Issuance of common stock upon conversion of related party promissory note, shares | 2,899,297 | |||||||
Issuance of common stock upon conversion of related party promissory note | 40,590 | 40,590 | 40,590 | |||||
Issuance of common stock in initial public offering, net of $13,370 in offering costs, shares | 6,900,000 | |||||||
Issuance of common stock in initial public offering, net of $13,034 in offering costs | 83,566 | $ 1 | 83,565 | 83,566 | ||||
Series F put right accretion (post LLC conversion) | (583) | (583) | (583) | |||||
Redeemable common stock put right expiration, shares | 10,714,285 | |||||||
Redeemable common stock put right expiration | 171,000 | $ 1 | 170,999 | 171,000 | ||||
Stock-based compensation expense (post LLC conversion) | 54,925 | 54,925 | 54,925 | |||||
Shares issued in connection with employee stock plans, net of shares withheld for employee taxes, shares | 1,074,949 | |||||||
Shares issued in connection with employee stock plans, net of shares withheld for employee taxes | (5,838) | (5,838) | (5,838) | |||||
Deemed capital contributions from Chairman and CEO (post LLC conversion) | 2,980 | 2,980 | 2,980 | |||||
Equity component of the convertible notes issuance, net | 14,318 | 14,318 | 14,318 | |||||
Other comprehensive income | 608 | 608 | 608 | |||||
Net loss | (184,102) | (184,102) | (184,102) | |||||
Ending balance, units at Dec. 31, 2016 | 0 | |||||||
Ending balance, members' equity at Dec. 31, 2016 | $ 0 | |||||||
Ending balance, shares at Dec. 31, 2016 | 121,250,437 | |||||||
Ending balance, including noncontrolling interest at Dec. 31, 2016 | 411,594 | $ 12 | $ 886,334 | $ (475,273) | $ 521 | $ 411,594 | $ 0 | |
Ending balance, attributable to parent at Dec. 31, 2016 | $ 411,594 |
Consolidated and Combined Stoc8
Consolidated and Combined Stockholders' / Members' Equity (Parenthetical) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Statement of Stockholders' Equity [Abstract] | |
Offering costs for initial public offering | $ 13,034 |
Consolidated and Combined Stat9
Consolidated and Combined Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities: | |||
Net loss | $ (184,102) | $ (72,011) | $ (84,617) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization | 30,933 | 15,788 | 16,178 |
Amortization of debt discounts and deferred financing offering cost | 108 | 0 | 0 |
Impairment of intangible asset | 0 | 0 | 24,150 |
Unrealized changes in fair value of marketable securities | (49) | (3,624) | 3,677 |
Realized changes in fair value of marketable securities | 49 | 3,971 | 109 |
Change in fair value of derivatives liability | (1,228) | 0 | 0 |
Stock-based compensation | 53,952 | 1,429 | 340 |
Deferred income taxes, net | (23,385) | 0 | 0 |
Provision for bad debt expense | 549 | 207 | 204 |
Inventory provision | 499 | 7 | 38 |
Loss (income) from related party equity method investments | 40,994 | 2,584 | (1,525) |
Other non-cash expense | 144 | 0 | 333 |
Changes in operating assets and liabilities, net of business combinations: | |||
Accounts receivable, net | 8,111 | 3,580 | 468 |
Inventories | (570) | 982 | (2,308) |
Related party receivables, net | (325) | 228 | 120 |
Prepaid expenses and other current assets | 3,495 | (4,245) | (132) |
Deferred implementation costs | (5,952) | (4,155) | 0 |
Accounts payable | (5,644) | 1,731 | 1,634 |
Accrued and other current liabilities | 3,787 | 5,450 | (4,606) |
Deferred revenue | 3,853 | (21,158) | (928) |
Related party payables | 4,220 | (4,738) | 7,582 |
Other assets and liabilities | (73) | (26) | (2,852) |
Net cash used in operating activities | (70,634) | (74,000) | (42,135) |
Cash flows from investing activities: | |||
Purchase of property and equipment | (15,780) | (8,244) | (7,637) |
Investments in unconsolidated related parties | 0 | (150,816) | (3,319) |
Purchases of intangible assets | 0 | (5,000) | (4,000) |
Purchases of marketable securities | (31) | (15,219) | (251,729) |
Proceeds from sales of marketable securities | 1,275 | 136,315 | 26,072 |
Proceeds from sales of property and equipment | 138 | 0 | 0 |
Purchase of cost method investment | 0 | (1,750) | 0 |
Proceeds from sale of business and equity method investment, net of cash transferred | 0 | 0 | 12,842 |
Acquisitions of businesses, net of cash acquired | (78,725) | (50,548) | (2,306) |
Deferred consideration for acquisition | 4,358 | 0 | 0 |
Net cash used in investing activities | (88,765) | (95,262) | (230,077) |
Cash flows from financing activities: | |||
Proceeds from issuance of membership interests | 0 | 200,000 | 260,525 |
Deemed capital contribution from Chairman and CEO | 3,810 | 6,190 | 0 |
Payment of short-term notes payable | 23,324 | 0 | 0 |
Payment of long-term notes payable | 0 | 0 | (1,975) |
Earnout to former non-controlling interests | 0 | 0 | (5,608) |
Proceeds from (payment of) related party promissory notes | 152,666 | (34,502) | 5,903 |
Proceeds from initial public offering, net of offering costs | 83,566 | 0 | 0 |
Proceeds from issuance of convertible notes to related party, net of offering costs | 9,917 | 0 | 0 |
Proceeds from issuance of convertible notes to others, net of offering costs | 92,797 | 0 | 0 |
Tax payments related to stock issued, net of stock withheld, for vested phantom units | (5,838) | 0 | 0 |
Net cash provided by financing activities | 313,594 | 171,688 | 258,845 |
Effect of exchange rate changes on cash and cash equivalents | 169 | (136) | 49 |
Net increase in cash and cash equivalents | 154,364 | 2,290 | (13,318) |
Cash and cash equivalents, beginning of period | 5,989 | 3,699 | 17,017 |
Cash and cash equivalents, end of period | 160,353 | 5,989 | 3,699 |
Supplemental disclosure of cash flow information: | |||
Interest paid | (11) | (2,193) | (31) |
Interest received | 119 | 599 | 0 |
Non-cash transactions: | |||
Transfer of marketable securities as investment in unconsolidated related party | 0 | 99,184 | 0 |
Healthcare Solutions acquisition escrow receivable | 0 | 2,494 | 0 |
Purchase of property and equipment (including internal use software capitalized costs including stock based compensation) | 2,962 | 0 | 0 |
Accretion to redemption value of Series F / redeemable common stock | 4,958 | 16,042 | 0 |
Conversion of related party promissory note and interest payable to common stock | 40,590 | 0 | 0 |
Reclassification of redeemable common stock to common stock (former Series F units) | 171,000 | 0 | 0 |
Equity component reclassification of the convertible notes issuance, net | $ 14,318 | $ 0 | $ 0 |
Description of Business and Bas
Description of Business and Basis of Presentation | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Basis of Presentation | Description of Business and Basis of Presentation Nature of Business Nant Health, LLC was formed on July 7, 2010, as a Delaware limited liability company. On June 1, 2016, Nant Health, LLC converted into a Delaware corporation (the “LLC Conversion”) and changed its name to NantHealth, Inc. (“NantHealth”). NantHealth, together with its subsidiaries (the “Company”) , is a healthcare IT company converging science and technology through a single integrated clinical platform, to provide actionable health information at the point of care, in the time of need, anywhere, anytime. NantHealth works to transform clinical delivery with actionable clinical intelligence at the moment of decision, enabling clinical discovery through real-time machine learning systems. The company’s technology empowers physicians, patients, payers and researchers to transcend genomics into the world of proteomics and the traditional barriers of today’s healthcare system. By converging molecular science, computer science and big data technology the Nant Operating System (NantOS) platform allows physicians, patients and payers to coordinate care, monitor outcomes and control cost in real time. NantHealth is a majority-owned subsidiary of NantWorks, LLC (“NantWorks”), which is a subsidiary of California Capital Equity, LLC (“Cal Cap”). The three companies were founded by and are led by Dr. Patrick Soon-Shiong. As of December 31, 2016 , the Company conducted the majority of its operations in the United States, Canada, the United Kingdom, Singapore and India. LLC Conversion and Initial Public Offering On June 1, 2016, immediately prior to the pricing of its initial public offering (“IPO”) and in conjunction with the LLC Conversion, all outstanding units of Nant Health, LLC were automatically converted into shares of NantHealth’s common stock. Immediately following the LLC Conversion, NantHealth effected a 1 -for- 5.5 reverse stock split of its common stock. All share and per share amounts in the Consolidated and Combined Financial Statements and notes thereto have been retroactively adjusted, where necessary, to give effect to this reverse stock split. On June 7, 2016, the Company completed its IPO, whereby it sold 6,500,000 shares of common stock at a public offering price of $14.00 per share. Additionally, on June 9, 2016, the underwriters partially exercised their option to purchase an additional 400,000 shares of common stock at $14.00 per share. The Company received a total of $83,566 in proceeds from its IPO, after deducting underwriting discounts and commissions and offering costs of $13,034 . The offering was registered under the Securities Act of 1933, as amended, on a registration statement on Form S-1 (Registration No. 333-211196), as amended (the “Registration Statement”). Basis of Presentation and Principles of Consolidation The accompanying Consolidated and Combined Financial Statements include the financial statements of NantHealth and its wholly owned subsidiaries and other entities in which NantHealth has a controlling financial interest. For consolidated subsidiaries that are less than wholly owned, the third-party holdings of equity interests are referred to as non-controlling interests. All intercompany accounts and transactions have been eliminated in consolidation. These Consolidated and Combined Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Certain reclassifications have been made to prior period amounts to conform to the current year presentation. The transfer and assignment by NantWorks to NantHealth of the equity interests in NantCloud Services, LLC (“NantCloud”) was recorded and presented at its carryover basis since NantHealth and the transferor are under common control. The historical statements of operations, stockholders' / members’ equity and cash flows of NantCloud have been combined with the Company's statements of operations, stockholders' / members’ equity and cash flows beginning on the date of inception of common control of the entity. Net.Orange, Inc. (“NDO”) was treated as an available-for-sale debt investment on NantHealth’s consolidated balance sheet beginning October 2, 2012 as NantHealth did not have a controlling financial interest in the entity until June 2014 when it acquired the remaining equity interests in NDO that it did not already own (See Note 3 and Note 11). |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the Consolidated and Combined Financial Statements and accompanying notes. Actual results may differ from those estimates. The estimates and assumptions used in the accompanying Consolidated and Combined Financial Statements are based upon management’s evaluation of the relevant facts and circumstances at the balance sheet date. On an ongoing basis, the Company evaluates its estimates, including those related to revenue recognition, accounts receivable allowance, inventory provisions, useful lives of long-lived assets and intangible assets, income taxes, stock based compensation, impairment of long-lived assets and intangible assets and the fair value of its investments and derivatives liability. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which can affect the reported amounts of assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. Variable Interest Entities The Company evaluates its ownership interests, contractual rights and other interests in entities to determine if the entities are variable interest entities (“VIEs”), if it has a variable interest in those entities and the nature and extent of those interests. These evaluations are highly complex and involve judgment, the use of estimates and assumptions based on available historical information. In order for the Company to be the primary beneficiary of a VIE, it must have both (1) the power to direct the activities of a VIE that most significantly affect the VIE’s economic performance and (2) the obligation to absorb losses or the right to receive benefits that, in either case, could potentially be significant to the VIE. The Company consolidates entities of which it is the primary beneficiary. The Company determines whether it is the primary beneficiary of a VIE upon its initial involvement with the VIE and reassesses whether it is the primary beneficiary on an ongoing basis. This determination is based upon an analysis of the design of the VIE, including the VIE’s structure and activities, the power to make significant economic decisions held by the Company and by other parties, and the variable interests owned by the Company and other parties. Non-Controlling Interests Non-controlling interests are classified as a separate component of equity in the Consolidated and Combined Balance Sheets and Consolidated and Combined Statements of Changes in Members’ Equity / Stockholders' Equity. Additionally, net loss attributable to non-controlling interests is reflected separately from consolidated and combined net loss in the Consolidated and Combined Statements of Operations, Comprehensive Loss and Changes in Members’ Equity / Stockholders' Equity. The Company uses the hypothetical liquidation at book value (“HLBV”) method to attribute certain non-wholly owned subsidiaries’ income or loss to the non-controlling interests when such income or loss is not allocated to the equity holders based on pro rata ownership percentage. This allocation methodology best represents the economics of the non-controlling interest holders’ share of income or loss. HLBV uses a balance sheet approach, which measures the non-controlling interests’ share of income or loss by calculating the change in the amount of net assets the investors are legally able to claim based on a hypothetical liquidation of the entity at the beginning and end of a reporting period. Revenue Recognition Revenue represents the consideration received or receivable from clients for solutions and services provided by the Company. The Company’s revenue is generated from the following sources: • Software and hardware - Software and hardware revenue is generated from the sale of the Company’s software, on either a perpetual or term license basis, and the sale of hardware. The software is installed on the client’s site or the client’s designated vendor’s site and is not hosted by the Company or by a vendor contracted by the Company. The Company also sells third-party software and hardware to its clients. • Software-as-a-service (“SaaS”) - SaaS revenue is generated from clients’ access to and usage of the Company’s hosted software solutions on a subscription basis for a specified contract term, which is usually monthly. In SaaS arrangements, the client cannot take possession of the software during the term of the contract and generally has the right to access and use the software and receive any software upgrades published during the subscription period. • Maintenance - Maintenance revenue includes ongoing post contract client support (“PCS”) or maintenance during the paid PCS term. Additionally, PCS includes ongoing development of software updates and upgrades provided to the client on a when and if available basis. • Sequencing and molecular analysis - Sequencing and molecular analysis revenue is generated by the process of performing sequencing and analysis of whole genome DNA, RNA and proteomic results under the Company's reseller agreement with NantOmics, LLC ("NantOmics") (See Note 21 ). • Other services - Other services includes revenue from professional services provided that are generally complementary to the software and may or may not be required for the software to function as desired by the client. The services are generally provided in the form of training and implementation services during the software license period and do not include PCS. Other services revenue also includes the sale of nursing and therapy services provided to patients in a home care setting and any other services not included in the preceding revenue sources. Revenue is recognized when persuasive evidence of an arrangement exists, services or products have been provided to the client, fees are fixed or determinable, and collectability is reasonably assured. While most of the Company’s arrangements include short-term payment terms, the Company on occasion provides payment terms to clients in excess of one year from the date of contract signing. The Company does not recognize revenue for arrangements containing these extended payment terms until such payments become due. Certain of the Company’s customer arrangements allow for termination for convenience with advanced notice. Such termination rights do not allow for refunds other than prepaid PCS or other services. These provisions do not affect when the Company commences revenue recognition. The Company also has certain arrangements which allow for termination and refunds of fees in the event that software acceptance by the customer has not occurred. In these instances, the Company will defer all revenue until software acceptance has occurred. The Company's clinical sequencing and molecular analysis revenue is primarily generated from payments received from commercial third-party payors, hospitals and other provider networks and patients. The Company reports revenue from arrangements with these customers on a gross basis in accordance with Financial Accounting Standards Board (“ FASB") Accounting Standards Update ("ASC") No. 605-45, Principal Agent Considerations . The Company recognizes revenue from these arrangements when all revenue recognition criteria have been met or on a cash basis when it cannot conclude that the fees are fixed or determinable and collectability is reasonably assured. The Company uses judgment in its assessment of whether the fees are fixed or determinable and whether collectability is reasonably assured in determining when to recognize revenue in the future as it continues to gain payment experience with its customers. Accordingly, the Company expects to recognize revenue on a cash basis when it cannot conclude that the fees from a particular customer are fixed or determinable and collectability is reasonably assured until it has a sufficient history to reliably estimate payment patterns from such customer. The Company engages in various multiple-element arrangements, which may generate revenue across any of the sources noted above. For multiple-element software arrangements that involve the sale of the Company’s proprietary software, PCS and other software-related services, vendor-specific objective evidence (“VSOE”) of fair value is required to allocate and recognize revenue for each element. VSOE of fair value is determined based on the price charged in which each deliverable is sold separately. The Company has established VSOE for PCS on certain of its software solutions using the Stated Renewal Method. In this instance, the Company has determined that its stated renewals are substantive and appropriate for use in the Stated Renewal Method. The Company has not yet established VSOE of fair value for any element other than PCS for a portion of its arrangements. In situations where VSOE of fair value exists for PCS but not a delivered element (typically the software license and services elements), the residual method is used to allocate revenue to the undelivered element equal to its VSOE value with the remainder allocated to the delivered elements. In situations in which VSOE of fair value does not exist for all of the undelivered software-related elements, revenue is deferred until only one undelivered element remains (typically the PCS element) and then recognized following the pattern of delivery of the final undelivered element. The Company’s multiple element arrangements typically provide for renewal of PCS terms upon expiration of the original term. The amounts of these PCS renewals are recognized as revenue ratably over the specified PCS renewal period. For non-software arrangements that include multiple-elements, primarily consisting of the Company’s SaaS agreements and research sequencing and molecular analysis agreements, revenue recognition involves the identification of separate units of accounting after consideration of combining and/or segmenting contracts and allocation of the arrangement consideration to the units of accounting on the basis of their relative selling price. The selling price used for each deliverable is based on VSOE of fair value, if available, third party evidence (“TPE”) of fair value if VSOE is not available, or the Company’s best estimate of selling price (“BESP”) if neither VSOE nor TPE is available. In determining the units of accounting for these arrangements, the Company evaluates whether each deliverable has stand-alone value as defined in the FASB’s guidance. The Company’s SaaS arrangements are treated as a single unit of accounting as the professional services do not have standalone value. As a result, the Company recognizes initial system implementation and deployment fees ratably over a period of time from when the system implementation or deployment services are completed and accepted by the customer over the longer of the life of the agreement or the estimated customer life. If an arrangement to deliver software requires significant production, modification or customization of the licensed software, the Company accounts for the arrangement as a construction-type contract. The Company currently recognizes revenue for these arrangements using the completed-contract method as it does not currently have sufficient information to reliably estimate the percentage of completion for these projects. The Company considers these arrangements to be substantially complete upon the clients’ acceptance of the software and related professional services and consistently applies this policy to all contract accounting arrangements. Transaction processing fees are recognized on a monthly basis based on the number of transactions processed and the fee per transaction. Revenue derived from reseller arrangements is recognized when the resellers, in turn, sell the software solution to their clients and installation of the software solution has occurred, provided all other revenue recognition criteria are met. This is commonly referred to as the sell-through method and the Company defers recognition until there is a sell-through by the reseller to an actual end user clients and acceptance by the end user has occurred. Cost of Revenue Cost of revenue includes associate salaries, bonuses and benefits, stock based compensation, consultant costs, direct reimbursable travel expenses, depreciation related to software developed for internal use and other direct engagement costs associated with the design, development, sale and installation of systems, including system support and maintenance services for clients. System support includes ongoing client assistance for software updates and upgrades, installation, training and functionality. All service costs except deferred implementation costs are expensed when incurred. Amortization of deferred implementation costs are also included in cost of revenue. Cost of revenue associated with each of the Company’s revenue sources consists of the following types of costs: • Software and hardware - Software and hardware cost of revenue includes third-party software and hardware costs directly associated with solutions, including purchasing and receiving costs. • Software-as-a-service - SaaS cost of revenue includes personnel-related costs, amortization of deferred implementation costs and other direct costs associated with the delivery and hosting of NantOS and NantOS apps, the cancer-decision support solution, and NaviNet on a subscription basis. • Maintenance - Maintenance cost of revenue includes personnel-related costs and other direct costs associated with the ongoing support or maintenance provided to the Company’s clients. • Sequencing and molecular analysis - Sequencing and molecular analysis cost of revenue includes (a) personnel-related costs associated with these services and (b) amounts due to NantOmics under the reseller agreement (See Note 21 ) for the sequencing and analysis of whole genome, DNA, RNA and proteomic results. • Other services - Other services cost of revenue includes personnel-related, amortization of deferred implementation costs and other direct costs associated with the Company’s software training and implementation services provided to our clients as well as direct expenses relating to the Company’s nursing and therapy services provided to patients in a home care setting. In addition to direct labor costs, cost of revenue also includes hardware costs directly related to bringing manufactured products to their final selling destination. It includes purchasing and receiving costs and direct and indirect costs to manufacture products, including direct materials, direct labor, and direct overhead expenses necessary to acquire and convert purchased materials and supplies into finished goods. Selling, General and Administrative costs Selling, general and administrative expense consists primarily of shared service fees from NantWorks, personnel-related expenses for our sales and marketing, finance, legal, human resources, and administrative associates, stock based compensation, and advertising and marketing promotions of NantHealth solutions. It also includes trade show and event costs, sponsorship costs, point of purchase display expenses and related amortization as well as legal costs, consulting and professional fees, insurance and other corporate and administrative costs. Advertising costs are expensed as incurred. Research and Development Expenses Research and development (“R&D”) costs incurred to establish the technological feasibility of software to be sold are expensed as incurred. These expenses include the costs of the Company’s proprietary R&D efforts, as well as costs incurred in connection with certain licensing arrangements. Development costs, consisting primarily of employee salaries and benefits (including stock based compensation), incurred in the research and development of new software products and enhancements to existing software products are expensed as incurred until technological feasibility has been established. After technological feasibility is established, any software development costs are capitalized. Costs incurred to acquire or create a computer software product are expensed when incurred as research and development until technological feasibility has been established for the product, at which point such costs are capitalized. Technological feasibility is normally established upon completion of a detailed program design or, in its absence, a working model of the software product. Capitalization of computer software costs to be sold to customers ceases when the product is available for general release to customers. As of December 31, 2016 and 2015 , the Company has not capitalized software costs to be sold to customers as no significant costs have been incurred in developing software products and technological feasibility has not been established for new software products and enhancements to existing software. Stock Based Compensation The Company accounts for stock based compensation arrangements granted to employees in accordance with ASC 718, " Compensation: Stock Compensation", by measuring the grant date fair value of the award and recognizing the resulting expense over the period during which the employee is required to perform service in exchange for the award. The Company accounts for stock based compensation arrangements issued to non-employees using the fair value approach prescribed by ASC 505-50, “ Equity-Based Payments to Non-Employees". The value of non-employee stock based compensation is re-measured at the end of each reporting period until the award vests and is recognized as stock based compensation expense over the period during which the non-employee provides the services. Stock based compensation expense for both employee and non-employee awards is recognized on a straight-line basis over the appropriate service period for awards that are only subject to service conditions and is recognized using the accelerated attribution method for awards that are subject to performance conditions. Stock based compensation expense is only recognized for awards subject to performance conditions if it is probable that the performance condition will be achieved. The Company early adopted FASB ASU 2016-09, “ Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting ” (“ASU 2016-09”) related to stock based compensation, beginning July 1, 2016, simplifying the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory withholding requirements, as well as the related classification in the statement of cash flows. All excess tax benefits and tax deficiencies are recognized as income tax benefit or expense in the income statement as discrete items in the reporting period in which they occur, and such tax benefits and tax deficiencies are not included in the estimate of an entity’s annual effective tax rate, applied on a prospective basis. The recognition of excess tax benefits is not deferred until the benefit is realized through a reduction to taxes payable. When the Company applies the treasury stock method, in calculating diluted earnings per share, excess tax benefits, if applicable, are excluded and deficiencies from the calculation of assumed proceeds since such amounts are recognized in the income statement. Excess tax benefits if applicable, are classified as operating activities in the same manner as other cash flows related to income taxes on the statement of cash flows. Per ASU 2016-09, an entity can make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest (current GAAP) or account for forfeitures when they occur. The Company has elected to account for forfeitures when they occur. Cash paid by the Company when directly withholding shares for tax withholding purposes should be classified as a financing activity in the Statement of Cash Flows (See Note 15 and Note 19). Change in fair value of derivative liability The Company has classified the interest make-whole provision of its convertible notes and related party convertible note due June 2021 and issued in December 2016 as a derivative liability as part of other liabilities and related party liabilities, respectively, in the Consolidated and Combined Balance Sheets and is recorded at fair value. This derivative liability is subject to re-measurement at each balance sheet date, and the Company recognizes any change in fair value in the Company's Consolidated and Combined Statements of Operations as a change in fair value of the derivative liability. The change in the fair value of this derivative liability is primarily due primarily to the change in the value of the Company's common stock (See Note 13). Income Taxes Prior to June 1, 2016, NantHealth was a limited liability company taxed as partnership. It also owned a number of subsidiaries, including single member limited liability companies taxed as disregarded entities and corporations. The income and losses of the entities classified as pass-through entities for tax purposes flowed directly through to the members of the partnership. Accordingly, no provision for U.S. federal and state income taxes was reflected in the Consolidated and Combined Financial Statements for the pass-through income or losses. The Company recorded a tax provision on its domestic and foreign corporate subsidiaries. On June 1, 2016, NantHealth converted from a limited liability company to a C corporation and formed a consolidated group with its domestic corporate subsidiaries for federal tax purposes. The Company now records federal and state tax provision of the consolidated group, and foreign tax provision of its foreign subsidiaries. FASB ASC Topic 740 Income Taxes (“ Topic 740 ”) provides the accounting treatment for uncertainty in income taxes recognized in an enterprise’s financial statements. Topic 740 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Topic 740 also provides guidance on derecognizing, classification, interest and penalties, accounting in interim periods, disclosure and transition. As part of the process of preparing our Consolidated and Combined Financial Statements, the Company is required to estimate its provision for income taxes in each of the tax jurisdictions in which the Company conducts business. This process involves estimating our actual current tax expense in conjunction with the evaluation and measurement of temporary differences resulting from differing treatment of certain items for tax and accounting purposes. These temporary differences result in the establishment of deferred tax assets and liabilities, which are recorded on a net basis and included in the Company's Consolidated and Combined Balance Sheets. The Company then evaluates on a periodic basis the probability that the net deferred tax assets will be recovered and therefore realized from future taxable income and to the extent the Company believes that recovery is not more likely than not, a valuation allowance is established to address such risk resulting in an additional related provision for income taxes during the period. Significant management judgment is required in determining its provision for income taxes, its deferred tax assets and liabilities, tax contingencies, unrecognized tax benefits, and any required valuation allowance, including taking into consideration the probability of the tax contingencies being incurred. Management assesses this probability based upon information provided by its tax advisers, its legal advisers and similar tax cases. If at a later time its assessment of the probability of these tax contingencies changes, its accrual for such tax uncertainties may increase or decrease. The Company has a valuation allowance due to management’s overall assessment of risks and uncertainties related to its future ability to realize and, hence, utilize certain deferred tax assets, primarily consisting of net operating losses, carry forward temporary differences and future tax deductions. The effective tax rate for annual and interim reporting periods could be impacted if uncertain tax positions that are not recognized are settled at an amount which differs from the Company's estimate. Finally, if the Company is impacted by a change in the valuation allowance resulting from a change in judgment regarding the realizability of deferred tax assets, such effect will be recognized in the interim period in which the change occurs. Net Income (Loss) Per Share Basic net income (loss) per share is computed by dividing the net income (loss) by the weighted-average number of shares of common stock outstanding during the period. Diluted net income (loss) per share is computed by dividing the net income (loss) by the weighted-average number of shares of common stock outstanding during the period, adjusted to give effect to potentially dilutive securities. However, potentially dilutive securities are excluded from the computation of diluted net income (loss) per share to the extent that their effect is anti-dilutive. The Company applies treasury method in calculating weighted average dilutive umber of shares for its stock plans. The Company recorded in certain reporting periods an accretion to the carrying value of the Redeemable Series F units and a reduction to members’ equity carrying amount, when the Company deemed it probable that the Series F units would be redeemed. As a result, the net loss applicable to common stockholders reported in the calculation of earnings per share was increased, income for redeemable Series F was increased, and a two class method of net income (loss) per share was applied (See Note 16 and Note 20). Foreign Currency Translation The Company has operations and holds assets in various foreign countries. The local currency is the functional currency for the Company’s subsidiaries in Canada, United Kingdom, Singapore and India. Assets and liabilities are translated at end-of-period exchange rates while revenues and expenses are translated at the average exchange rates in effect during the period. Equity is translated at historical rates and the resulting cumulative translation adjustments are included as a component of accumulated other comprehensive income until the translation adjustments are realized. Segment Reporting The chief operating decision maker for the Company is its Chief Executive Officer. The Chief Executive Officer reviews financial information presented on a Consolidated and Combined basis for purposes of allocating resources and evaluating financial performance. The Company has one business activity and there are no segment managers who are held accountable for operations, operating results, or plans for levels or components below the Consolidated and Combined unit level. Accordingly, management has determined that the Company operates in one reportable segment. Business Combinations Business combinations are accounted for using the acquisition method of accounting. Under the acquisition method, assets acquired and liabilities assumed are recorded at their respective fair values as of the acquisition date. Any excess of the purchase price over the estimated fair values of the net assets acquired is recorded as goodwill. Management routinely monitors the factors impacting the acquired assets and liabilities. Transaction related costs are expensed as incurred. The operating results of the acquired business are reflected in the Company’s Consolidated and Combined Financial Statements as of the acquisition date. Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are classified and disclosed in one of the following three categories: • Level 1—Quoted prices for identical assets or liabilities in active markets; • Level 2—Quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active or are directly or indirectly observable; and • Level 3—Unobservable inputs that reflect estimates and assumptions. The carrying amounts reported in the balance sheet for cash and cash equivalents, accounts receivable, accounts payable, notes payable, deferred revenue and other current monetary assets and liabilities approximate fair value because of the immediate or short-term maturity of these financial instruments. In accordance with this guidance, the Company measures its cash equivalents and marketable securities at fair value. The Company’s cash equivalents and marketable securities are classified within Level 1. Cash equivalents and marketable securities are valued primarily using quoted market prices utilizing market observable inputs. Cash and Cash Equivalents The Company considers all unrestricted, highly liquid investments with an initial maturity of three months or less to be cash equivalents. These amounts are stated at cost, which approximates fair value. At December 31, 2016 and 2015 , cash equivalents were deposited in financial institutions and consisted of immediately available fund balances. Cash and cash equivalents are maintained at stable financial institutions, generally at amounts in excess of federally insured limits, which represents a concentration of credit risk. The Company has not experienced any losses on deposits of cash and cash equivalents to date. Marketable Securities The Company’s marketable securities consist of investments in mutual funds and are reported on the balance sheet at fair value based upon quoted market prices (See Note 13). Although the Company does not actively trade these investments, it classifies the marketable securities as trading securities. The cost of investments sold is determined on the specific identification method. Dividend and interest income are accrued as earned. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount, net of amounts related to PCS and other services that were billed but not yet delivered at each period end (See Note 4) and net of allowances for doubtful accounts. The allowance for doubtful accounts is based on management’s assessment of the collectability of accounts. The Company regularly reviews the adequacy of the allowance for doubtful accounts by considering the age of each outstanding invoice and the collection history of each client to determine whether a specific allowance is appropriate. Accounts receivable deemed uncollectible are charged against the allowance for doubtful accounts when identified. Concentrations of Risk The following table summarizes the number of customers that individually comprise greater than 10% of revenues and or 10% of accounts receivable, and their aggregate percentages of total revenues and total billed and unbilled accounts receivable: Period Significant Customers Percentage of Total Revenues Percentage of Total Accounts Receivable A B A B Year Ended December 31, 2016 2 10.6% 10.2% 7.9% 7.6% Year Ended December 31, 2015 1 14.7% —% —% —% No customers accounted for more than 10% of revenue for the year ended December 31, 2014 . Inventories Through December 31, 2015 inventories were stated at the lower of cost (first-in, first-out basis) or market. The Company early adopted FASB ASC 2015-11 Simplifying the Measurement of Inventory ("ASC 2015-11") , and starting in December 31, 2016 inventories were stated at the lower of cost and net realizable value. There was no material effect to the adoption of ASC 2015-11. Property, Plant and Equipment, net Property, plant and equipment received in connection with business combinations are recorded at fair value. Property, plant and equipment acquired in the normal course of business are recorded at cost. Depreciation is computed on a straight line basis over the estimated useful lives of the related assets (See Note 7). Maintenance and repairs are charged to expense as incurred while expenditures for refurbishments and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized. The Company a |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Business Combinations | Business Combinations 2016 Acquisition NaviNet, Inc. On November 30, 2015, NantHealth entered into a definitive agreement with 3BE Holdings, LLC (“3BE”) to acquire 100% of the outstanding equity interest of NaviNet, Inc. (“NaviNet”) in exchange for $83,529 in cash, subject to working capital adjustments, 15,513,726 newly issued Series H units with a fair value of $52,500 and contingent arrangements or earnouts of up to $12,250 , which was effective on January 1, 2016. The contingent arrangements or earnouts require the Company to pay up to a total of $12,250 to certain of NaviNet’s former shareholders if NaviNet’s revenues to those former shareholders exceed certain thresholds during the years ended December 31, 2016 and 2017. These contingent amounts or earnouts have been excluded from the purchase price consideration and are accounted for as sales incentives as certain predefined targets are met and are reflected as contra revenue. The cash portion of the acquisition was financed through a promissory note with NantCapital, LLC (“NantCapital”), an affiliate of the Company (See Note 21 ). In June 2016, the Company paid an additional $455 to 3BE as the final working capital adjustment and accounted for the payment as an increase to the purchase price of NaviNet. In December 2016, and in accordance with the definitive agreements, the Company received $2,409 out of the escrow account for the settlement of the final net working capital adjustment. The following table summarizes the total purchase consideration for the acquisition: Amounts Cash paid to 3BE at closing $ 74,823 Cash paid to option holders after closing 2,580 Cash paid to escrow account 6,126 Working capital settlement payment 455 Fair value of Series H units 52,500 Total consideration $ 136,484 The total consideration was allocated to the net assets acquired based upon their estimated fair values : Amounts Cash and restricted cash $ 4,804 Accounts receivable, net 10,693 Property, plant and equipment 5,044 Other assets and liabilities, net 4,561 Accounts payable (4,585 ) Accrued and other current liabilities (3,674 ) Deferred revenue (2,603 ) Deferred tax liability (15,508 ) Assumed indebtedness (23,324 ) Trade names 3,000 Developed technology 32,000 Customer relationships 52,000 Goodwill 74,076 Total fair value of net assets acquired $ 136,484 The estimated life of the acquired trade names is four years, the estimated life of customer relationships is fifteen years and the estimated life of the developed technology is seven years, with these intangibles amortized on a straight-line basis. The excess of the purchase price over the net tangible and intangible assets of $74,076 was recorded as goodwill, and considered non-deductible for income tax purpose. At the closing of the acquisition, the Company repaid all $23,324 of assumed indebtedness presented in the table above. Immediately prior to the closing, the board of directors of NaviNet approved the acceleration of all unvested stock options of NaviNet. The equity incentive plan governing these stock options stated that NaviNet’s board of directors had the right, at its sole discretion, to accelerate vesting of all outstanding stock options in connection with a change of control. The option holders received a payout of $7,394 immediately following the closing which represented the fair value of all vested and unvested stock options. The Company recognized in its post-acquisition results $4,814 of compensation expense during the year ended December 31, 2016 since the Company received post-combination benefits resulting from the accelerated vesting. During the year ended December 31, 2016, the Company recognized a net increase of $300 from measurement period adjustments, which reduced goodwill. The measurement period adjustments included a $2,909 increase to goodwill related to a decrease in property and equipment, a $697 decrease to goodwill related to an increase in research and development grant receivable, a $955 decrease to goodwill related to a decrease in deferred revenue, a $209 increase to goodwill related to a deferred tax liability increase due to various allocation adjustments, $455 increase to goodwill for working capital adjustments, a $188 increase to goodwill related to an accrued sales tax liability increase and a $2,409 decrease to goodwill, representing the Company’s right to be reimbursed from 3BE for severance benefits if their employment is terminated by the Company without cause or by the employee for good reason within 12 months after the closing date, which was settled through the escrow account in December 2016. 2015 Acquisitions NantCloud On May 31, 2015, NantHealth purchased 100% of the outstanding equity interests in NantCloud Services, LLC ("NantCloud") from NantWorks in exchange for $7,227 in cash, the amount invested in that business by NantWorks without any markup. NantCloud offers a secure cloud infrastructure for hosting sensitive healthcare data as well as information technology security services tailored for the healthcare industry. The Company accounted for its purchase of NantCloud as an arrangement between entities under common control. As a result, the acquisition was recorded and presented at carryover basis and the historical statements of operations and cash flows of NantCloud have been combined with the Company beginning on the date of inception of common control of each respective entity, which started February 10, 2014. Healthcare Solutions from Harris Corporation On June 16, 2015, the Company entered into a definitive agreement with Harris Corporation (“Harris”) to acquire certain assets and assume certain liabilities related to its Healthcare Solutions (“HCS”) business in exchange for $50,556 in cash, subject to working capital adjustments. The acquired assets comprise a business that helps complex healthcare delivery organizations achieve better patient outcomes, clinical and administrative workflow efficiency and stronger collaboration across the continuum of care. The acquisition of HCS closed on July 1, 2015 and furthered the Company’s mission to provide patients with a fully integrated and personalized approach to the delivery of care. The purchase consideration included $7,500 of funds held in escrow for the settlement of net working capital and other indemnifications. In March 2016, and in accordance with the definitive agreements, the Company received $2,494 out of the escrow account for the settlement of the final net working capital adjustment. The following table summarizes the total purchase consideration for the acquisition, including the effects of the final net working capital adjustment: Amounts Cash paid to Harris at closing $ 43,056 Cash paid to escrow account 7,500 Working capital released from escrow (2,494 ) Total consideration $ 48,062 The fair value of the identifiable assets acquired and liabilities assumed for the HCS business is shown in the table below: Amounts Accounts receivable, net $ 13,119 Other liabilities and assets, net (2,205 ) Deferred revenue (16,076 ) Trademarks 2,400 Developed technology 14,400 Customer relationships 8,900 Backlog 3,900 Goodwill 23,624 Total fair value of net assets acquired $ 48,062 The estimated lives of the acquired trademark, customer relationships and backlog are five years and the estimated life of the developed technology is seven years, to be amortized on a straight line basis. The excess of the purchase price over the net tangible and intangible assets of $23,624 was recorded as goodwill, and considered deductible for income tax purpose. During the year ended December 31, 2016 , the Company recognized $274 of net measurement period adjustments, which increased goodwill. 2014 Acquisition NDO On June 18, 2014, NantHealth entered into a Contribution and Merger Agreement with NDO and certain of its shareholders to acquire 100% of NDO’s equity that it did not already own. NDO provides healthcare informatics solutions through its cOS platform to address population health issues and help healthcare organizations implement a patient-centric virtually integrated care delivery model. The acquisition of NDO allowed the Company to bring together clinical, financial and operational data to identify and solve complex healthcare problems. The aggregate consideration for the acquisition was $32,958 and consisted of the issuance of 6,905,566 of NantHealth’s Series A units and $2,335 in cash to repay a portion of NDO’s debt. As part of the acquisition, NantHealth issued 18,348 Series C units to NDO’s former option holders who elected not to exercise those options prior to the close of the transaction. The fair value of Company’s Series A and C units was estimated using both an option pricing method and a probability weighted expected return method. The Company used a volatility and risk-free-rate of 45.0% and 0.95% , respectively, to estimate the fair value of the units. The estimated volatility was based on the historical equity volatility of comparable companies. Prior to June 18, 2014, NantHealth owned 13,712,558 shares of NDO’s Series A preferred stock which represented approximately 39.1% of the outstanding shares on a fully-diluted basis. The Company accounted for its non-controlling investment in NDO as an available-for-sale debt security as opposed to using the equity method because the shares were not considered in-substance common stock and the Company could have required NDO to redeem the investment. Prior to the acquisition, the investment was measured at fair value and any unrecognized gains or losses were recorded as a component of equity as accumulated other comprehensive income in the accompanying Consolidated and Combined Financial Statements. As of the year ended December 31, 2013 the Company had total unrealized losses of $504 related to its investment in NDO. Upon completion of the acquisition of the remaining NDO shares, NantHealth re-measured its previously owned investment in NDO at fair value as of the acquisition date and reclassified the cumulative losses of $332 out of accumulated other comprehensive income into other income (expense) in the Consolidated and Combined Statement of Operations during the year ended December 31, 2014. The fair value of the 13,712,558 shares of NDO’s Series A preferred stock was determined using an option pricing model to allocate the total equity value of NDO to the different classes of shares outstanding. Prior to the acquisition, NDO owed NantHealth $6,393 for amounts NantHealth had provided to fund NDO’s operations. The acquisition of NDO effectively settled this preexisting relationship and the settlement was accounted for separately from the business combination. No settlement amount was recorded in the Company’s Consolidated and Combined Statement of Operations for the year ended December 31, 2014 as the receivables were settled at their recorded amounts. The following table summarizes the total consideration for the acquisition, including interest-bearing liabilities assumed and the impacts of the settlement of preexisting relationships: Amounts Fair value of acquired 60.9% interest $ 16,619 Fair value of previously owned 39.1% investment 14,005 Debt repayment to NDO founder 2,335 Interest-bearing liabilities assumed 722 Settlement of preexisting relationships 6,393 Total consideration $ 40,074 The fair value of the identifiable assets acquired and liabilities assumed for the NDO acquisition is shown in the table below: Amounts Cash and cash equivalents $ 29 Non-cash net working capital, excluding deferred revenue (3,773 ) Property and Equipment and other non-current assets 332 Deferred revenue (7,352 ) Developed technology 23,400 Goodwill 27,438 Total fair value of net assets acquired $ 40,074 The estimated fair values of the developed technology, was primarily determined using excess earnings methods. The rate utilized to discount net cash flows to their present values was 9% and was determined after consideration of the overall enterprise rate of return and the relative risk and importance of the assets to the generation of future cash flows. The Company did not record any in process research and development assets as NDO’s major technology projects were either substantially complete or primarily represent improvements and additional functionality to existing products for which a substantial risk of completion did not exist. The estimated useful life of the acquired developed technology intangible was seven years to be amortized on a straight line basis. The excess of the purchase price over the net tangible and intangible assets of approximately $27,438 was recorded as goodwill, which primarily reflects the expected future benefits to be realized upon integrating NantHealth’s existing software solutions with NDO’s cOS platform. The goodwill is considered non-deductible for income tax purpose. The Company consolidated $1,041 and $11,221 of NDO’s revenue and net loss, respectively, from the acquisition date until December 31, 2014. Pro Forma Financial Information (Unaudited) The historical operating results of neither NaviNet nor HCS have been included in the Company’s historical Consolidated and Combined operating results prior to the respective acquisition dates. The following financial information presents the combined results of continuing operations for the year ended December 31, 2015, as if the acquisitions had been completed on January 1, 2015. As mentioned above, the results of NaviNet and HCS are included in the Company’s Consolidated and Combined Financial Statements beginning on January 1, 2016 and July 1, 2015, respectively. The unaudited pro forma results do not reflect any material adjustments, operating efficiencies or potential cost savings that may result from the consolidation of operations. Year Ended December 31, 2016 2015 Net revenue $ 100,380 $ 119,786 Net loss (184,102 ) (122,555 ) |
Accounts Receivable, net
Accounts Receivable, net | 12 Months Ended |
Dec. 31, 2016 | |
Receivables [Abstract] | |
Accounts Receivable, net | Accounts Receivable, net Accounts receivable, net excludes amounts related to PCS and other services that were billed but not yet delivered at each period end. These undelivered services are also excluded from the deferred revenue balances on the accompanying Consolidated and Combined Balance Sheets. The amount of outstanding and unpaid invoices excluded from both the accounts receivable and deferred revenue balances as of December 31, 2016 and 2015 was $5,325 and $12,643 , respectively. Accounts receivable are included on the Consolidated and Combined Balance Sheets net of the allowance for doubtful accounts. A summary of activity in the allowance for doubtful accounts for the years ended December 31, 2016 , 2015 and 2014 is as follows: Balance at beginning of the year Additions to expense (Write offs) / Recoveries Balance at the end of the year Year Ended December 31, 2016 $ 956 543 (1,047 ) $ 452 Year Ended December 31, 2015 $ 277 694 (15 ) $ 956 Year Ended December 31, 2014 $ 373 145 (241 ) $ 277 |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories as of December 31, 2016 and 2015 consisted of the following: December 31, 2016 2015 Finished goods $ 1,840 $ 2,005 Raw Materials 377 141 Inventories $ 2,217 $ 2,146 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets and Accrued and Other Current Liabilities | 12 Months Ended |
Dec. 31, 2016 | |
Other Current Assets And Other Current Liabilities [Abstract] | |
Prepaid Expenses and Other Current Assets and Accrued and Other Current Liabilities | Prepaid Expenses and Other Current Assets and Accrued and Other Current Liabilities Prepaid expenses and other current assets as of December 31, 2016 and 2015 consisted of the following: December 31, 2016 2015 Prepaid expenses $ 4,685 $ 2,161 Restricted cash (1) 100 — Deferred equity offering costs (See Note 1) — 3,902 Escrow receivable (See Note 3) — 2,494 Other current assets 261 150 Prepaid expenses and other current assets $ 5,046 $ 8,707 (1) Additional $250 of non-current restricted cash is included in the Company’s Consolidated and Combined Balance Sheets as part of Other assets. Accrued and other current liabilities of December 31, 2016 and 2015 consisted of the following: December 31, 2016 2015 Payroll and related costs $ 13,248 $ 7,194 Other accrued and other current liabilities 11,983 8,773 Accrued and other current liabilities $ 25,231 $ 15,967 |
Prepaid Expenses and Other Current Assets and Accrued and Other Current Liabilities | Prepaid Expenses and Other Current Assets and Accrued and Other Current Liabilities Prepaid expenses and other current assets as of December 31, 2016 and 2015 consisted of the following: December 31, 2016 2015 Prepaid expenses $ 4,685 $ 2,161 Restricted cash (1) 100 — Deferred equity offering costs (See Note 1) — 3,902 Escrow receivable (See Note 3) — 2,494 Other current assets 261 150 Prepaid expenses and other current assets $ 5,046 $ 8,707 (1) Additional $250 of non-current restricted cash is included in the Company’s Consolidated and Combined Balance Sheets as part of Other assets. Accrued and other current liabilities of December 31, 2016 and 2015 consisted of the following: December 31, 2016 2015 Payroll and related costs $ 13,248 $ 7,194 Other accrued and other current liabilities 11,983 8,773 Accrued and other current liabilities $ 25,231 $ 15,967 |
Property, Plant and Equipment,
Property, Plant and Equipment, net | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, net | Property, Plant and Equipment, net Property, plant and equipment, net as of December 31, 2016 and 2015 consisted of the following: December 31, Useful life (in years) 2016 2015 Computer equipment and software 3-5 $ 16,080 $ 9,865 Furniture and equipment 5-7 7,533 6,772 Leasehold and building improvements (1) 4,051 1,433 Internal use software 3 15,600 1,018 Construction in progress 1,090 1,462 44,354 20,550 Less: Accumulated depreciation and amortization (15,215 ) (6,651 ) Property, plant and equipment, net $ 29,139 $ 13,899 (1) Useful life for leasehold and building improvements represents the term of the lease or the estimated life of the related improvements, whichever is shorter. Depreciation expense was $8,088 for the year ended December 31, 2016 , of which $1,766 related to internal use capitalized software development costs. Depreciation expense was $3,660 and $1,451 for the years ended December 31, 2015 and 2014 , respectively, of which none related to internal use capitalized software development costs. Amounts capitalized to internal use software for the years ended December 31, 2016 and 2015 were $14,582 and $1,018 , respectively. |
Intangible Assets, net
Intangible Assets, net | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets, net | Intangible Assets, net The Company’s definite-lived intangible assets as of December 31, 2016 and 2015 consisted of the following: December 31, 2016 Customer Relationships Developed Technologies Software License Intellectual Property Trade Name Total Gross carrying amount $ 65,200 $ 98,930 $ 5,000 $ 2,400 $ 3,000 $ 174,530 Accumulated amortization (7,707 ) (44,665 ) (1,562 ) (720 ) (750 ) (55,404 ) Intangible assets, net $ 57,493 $ 54,265 $ 3,438 $ 1,680 $ 2,250 $ 119,126 December 31, 2015 Customer Relationships Developed Technologies Software License Intellectual Property Trade Name Total Gross carrying amount $ 13,200 $ 66,930 $ 5,000 $ 2,400 $ — $ 87,530 Accumulated amortization (1,680 ) (30,326 ) (313 ) (240 ) — (32,559 ) Intangible assets, net $ 11,520 $ 36,604 $ 4,687 $ 2,160 $ — $ 54,971 Amortization of finite-lived intangible assets is provided over their estimated useful lives on a straight-line basis or the pattern in which economic benefits are consumed, if reliably determinable. The Company reviews its finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Amortization expense were $22,845 , $12,127 and $14,727 for the years ended December 31, 2016 , 2015 and 2014 , respectively. During the year ended December 31, 2013, the Company recorded a $34,500 intangible asset, which was the consideration owed to the vendor for the right to use, operate, reproduce and sell the software solution exclusively within the United States and non-exclusively within the United Kingdom (the “UK Software License”). As of December 31, 2014, the Company paid the vendor $34,000 . The remaining $500 owed to the vendor was presented on the Consolidated and Combined Balance Sheet within Accrued and Other Current Liabilities and was paid in the year ended December 31, 2015. Prior to the impairment discussed below, the UK Software License was being amortized over a period of five years to coincide with the license term. During the year ended December 31, 2016 , the Company recorded $87,000 of definite-lived intangible assets related to the acquisition of NaviNet (See Note 3). These intangibles are amortized over a period of four to fifteen years. During the year ended December 31, 2015 , the Company recorded $29,600 of definite-lived intangible assets related to the acquisition of HCS (See Note 3). These intangible assets are amortized over a period of five to seven years. During the year ended December 31, 2014 , the Company recorded $23,400 for an intangible asset related to developed technologies as a result of the NDO acquisition (See Note 3). This intangible asset is amortized over a period of seven years. On September 29, 2015, the Company entered into an exclusive license agreement with NorthShore University Health System (“NorthShore”) to further develop their Health Heritage software platform and to license the software to customers. As part of the agreement, the Company paid NorthShore a one-time license fee of $5,000 and will pay royalties of at least $750 annually for the first four years of the agreement. The Company will have no obligation to pay any additional royalties after 7 years or once aggregate royalties reach $5,000 . The estimated future intangibles amortization expense over the next five years and thereafter for the intangible assets that exist as of December 31, 2016 is as follows: Amounts 2017 $ 19,078 2018 18,478 2019 18,166 2020 14,958 2021 11,646 Thereafter 36,800 Total future intangibles amortization expense $ 119,126 Impairment During the year ended December 31, 2014, the Company determined that a triggering event for the UK Software License had occurred given the nominal sales that had occurred during the year and the minimal progress made in developing and distributing the software in the licensed territories. The Company determined that the UK Software License had no fair value given the significant amount of costs required to further develop the software to a point in which it could be sold in the licensed territories. Therefore, the Company fully impaired the intangible asset on December 31, 2014 and recorded an impairment loss of $24,150 within operating expenses. |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill The Company performed a qualitative test on October 1, 2016 and 2015 for its single reporting unit to test for goodwill impairment. By review of macroeconomic conditions, industry and market conditions, cost factors, overall financial performance compared with prior projections, and other relevant entity-specific events, the Company determined that the fair value of the reporting unit was significantly in excess of the carrying value, and therefore concluded that a quantitative test was not necessary and as a result goodwill was not impaired as of December 31, 2016 and 2015 . Goodwill activity during the years ended December 31, 2015 and 2016 is shown as follows: Amounts Balance at January 1, 2015 $ 33,368 Activity during the year: HCS acquisition (See Note 3) 23,350 Balance at December 31, 2015 56,718 Activity during the year: NaviNet acquisition (See Note 3) 74,076 HCS measurement period adjustment (See Note 3) 274 Net activity during the year 74,350 Balance at December 31, 2016 $ 131,068 The Company added $74,076 of goodwill related to the acquisition of NaviNet on January 1, 2016 (See Note 3). On July 1, 2015 , the Company added $23,624 of goodwill related to the acquisition of the HCS business (See Note 3). During the year ended December 31, 2014, the Company sold its 80.0% fully diluted equity interest in Qi Imaging to Ziosoft KK (See Note 21 ). The Company allocated $424 of goodwill to the Qi Imaging reporting unit and derecognized this goodwill when the business was sold. Measurement period adjustments during the year ended December 31, 2016 reflected a decrease of $26 (See Note 3). No measurement period adjustments were recorded during the years ended December 31, 2015 and 2014 . |
Investments
Investments | 12 Months Ended |
Dec. 31, 2016 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments | Investments Equity method investments Investment in NantOmics during 2015 In 2015 the Company purchased a total of 169,074,539 Series A-2 units of NantOmics, LLC (“NantOmics”), a related party of the Company, for an aggregate purchase price of $250,774 . 67,385,444 Series A-2 units were acquired on June 19, 2015, 101,078,167 Series A-2 units were acquired on June 30, 2015 and 610,928 Series A-2 units were acquired on September 8, 2015, for aggregate price of $250,000 in cash and the remainder in exchange for NantOmics' subsidiary's purchase of NantHealth’s equity interests in TRM (See Investment in TRM and sale to NantCRO below). The Series A-2 units do not have any voting rights and represent approximately 14.28% of NantOmics’ issued and outstanding membership interests. NantOmics is majority owned by NantWorks and delivers molecular diagnostic capabilities with the intent of providing actionable intelligence and molecularly driven decision support for cancer patients and their providers at the point of care. The Company applied the equity method to account for its investment in NantOmics as the interest in the equity is similar to a partnership interest. Further, the Company has the ability to exert significant influence over the operating and financial policies of the entity since NantWorks controls both NantHealth and NantOmics. The difference between the carrying amount of the investment in NantOmics and the Company’s underlying equity in NantOmics’ net assets relate to both definite and indefinite-lived intangible assets. The Company attributed $28,195 and $14,382 of these differences to NantOmics’ developed technologies and its reseller agreement with the Company, respectively, prior to the application of developed technology intangibles included in NantOmics net assets, and the remaining basis differences were attributed to goodwill. The Company amortizes the basis differences related to the definite-lived intangible assets over the assets’ estimated useful lives and records these amounts as a reduction in the carrying amount of its investment and an increase in its equity method loss. The Company reports its share of NantOmics’ income or loss and the amortization of basis differences using a one quarter lag. For the year ended December 31, 2016 , the Company recognized $40,994 of loss related to this investment, including a $29,816 impairment charge as described below. From the date of the initial investment at June 19, 2015 through December 31, 2015, the Company recognized $2,584 of loss related to this investment, and no impairment charge recorded for that same period. During the year ended December 31, 2016, the Company determined that an other than temporary decrease in the value of the investment in NantOmics had occurred. The impairment analysis compared the estimated fair value of the Company's investment in NantOmics to its carrying value. The decline in the fair value was primarily caused by a change in the risk profile of the financial projections for NantOmics resulting from the delay in the Company’s GPS revenue growth. Key assumptions in the income approach include NantOmics’ forecasted revenue streams, operating expenses, capital expenditures, working capital requirements, tax rate and the discount rate used to determine the present value of the estimated future cash flows. As a result of the analysis, the Company recorded an other than temporary impairment on its equity method investment in NantOmics of $29,816 during the year ended December 31, 2016. The Company based its assumptions on projected financial information that the Company believes is reasonable; however, actual results may differ materially from those projections. It is reasonably possible that the estimate of the impairment of the equity method investment in NantOmics will change in the near term due to the following: actual NantOmics cash distribution is materially lower than expected, significant adverse changes in NantOmics's operating environment, increase in the discount rate, and changes in other key assumptions which require judgment and are forward looking in nature. The Company used the following summarized financial information for NantOmics for the trailing twelve months ended September 30, 2016 to record its equity investment method losses for the year ended December 31, 2016 : Trailing Twelve Months Ended September 30, 2016 Sales $ 5,189 Gross loss (5,752 ) Loss from operations (42,215 ) Net loss (36,435 ) Net loss attributable to NantOmics (34,236 ) Investment in NantPharma sold during 2014 During the year ended December 31, 2013, the Company purchased a minority equity interest in NantPharma, LLC, a related party entity of the Company ("NantPharma"), that was sold during the year ended December 31, 2014, and generated $1,525 of income for the year ended December 31, 2014 (See Note 21 ). There was no balance of investment in NantPharma as of December 31, 2016 and 2015 . Other investments Investment in IOBS during 2015 On June 16, 2015, the Company invested $1,750 in Innovative Oncology Business Solutions, Inc. (“IOBS”) in exchange for 1,750,000 shares of IOBS’s Series A preferred stock. IOBS offers community oncology practices an alternative medical home model for oncology patients that improves health outcomes, enhances patient care experiences and significantly reduces costs of care. The shares of preferred stock represent 35.0% of the outstanding equity of IOBS on an as-converted basis. The Company applied the cost method to account for its investment because the preferred stock is not considered in-substance common stock, is not considered a debt instrument as the Company cannot unilaterally demand redemption of the preferred stock and the preferred stock does not have a readily determinable fair value. Investment in TRM and sale to NantCRO during 2015 On September 8, 2015, the Company completed a Contribution Agreement with the members of Translational Research Management, LLC (“TRM”) whereby those members contributed their 54% equity interest in TRM in exchange for $250 in cash and 267,905 of the Company’s Series A units. TRM is a management services organization committed to building a nationwide network of community based medical oncology professionals dedicated to offering research studies to their patients. On June 1, 2016, the Series A units issued to TRM were converted into 44,778 shares of the Company’s common stock. On the same day, the Company sold its 54% equity interest in TRM to NantCRO, LLC, a wholly owned subsidiary of NantOmics, in exchange for $250 in cash and 610,928 of NantOmics’ Series A-2 units, which is equivalent in value to the purchase price paid by the Company. As a result, the Company’s ownership percentage in NantOmics is approximately 14.28% . |
Variable Interest Entities
Variable Interest Entities | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | Variable Interest Entities Prior to the transactions described below, the Company was the primary beneficiary of two VIEs, eviti, Inc. ("eviti") and Qi Imaging, and consolidated and combined the financial statements for these entities. The Company also had a variable interest in NDO but was not considered the primary beneficiary. IOBS On June 16, 2015, the Company invested $1,750 in IOBS’ Series A preferred stock and therefore has a variable interest in IOBS. The shares of preferred stock represent 35.0% of the outstanding equity of IOBS on an as-converted basis. The Company applied the cost method to account for its investment because the preferred stock is not considered in-substance common stock, is not considered a debt instrument as the Company cannot unilaterally demand redemption of the preferred stock and the preferred stock does not have a readily determinable fair value. As of December 31, 2016 and 2015 , IOBS was considered a variable interest entity. The Company is not the primary beneficiary of IOBS because it only has the right to elect two of five directors. All major decisions of IOBS require the majority vote by the members of the board of directors, including decisions made to manage the business including hiring and firing of officers and other critical management functions. Therefore, the Company does not consolidate IOBS. eviti In September and October of 2014, NantHealth purchased all of the non-controlling interests in eviti, which resulted in eviti becoming a wholly-owned subsidiary of NantHealth (See Note 17 ). Upon acquisition of the non-controlling interests, eviti ceased to be a VIE as it was determined that eviti’s equity was sufficient to finance its activities without additional subordinated financial support. Qi Imaging On April 25, 2014, NantHealth sold all of its equity interest in Qi Imaging to Ziosoft KK and deconsolidated the related assets and liabilities of Qi Imaging as it no longer had a variable interest in Qi Imaging and did not have the power to control Qi Imaging’s Board of Directors (See Note 21 ). NDO Prior to its acquisition of NDO on June 18, 2014, the Company had a variable interest in NDO but was not the primary beneficiary because it only had the right to elect three of six directors to NDO’s board of directors. All major decisions of NDO required the majority vote by the members of the board of directors, including decisions related to the approval of the annual operating budget and the hiring, firing, and compensation of all key executives. Therefore, NantHealth did not consolidate NDO prior to June 18, 2014. However, upon purchasing 100% of NDO’s outstanding equity interests that it did not already own in June of 2014, NantHealth received the right to appoint all members of NDO’s board of directors. Upon completion of the acquisition, NDO ceased to be a VIE as NDO’s equity was sufficient to finance its activities without additional subordinated financial support. There fore, NantHealth consolidated NDO under the voting interest model and applied purchase accounting as of June 18, 2014 (See Note 3). |
Convertible Notes
Convertible Notes | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Convertible Notes | Convertible Notes In December 2016, the Company entered into the Purchase Agreement with J.P. Morgan Securities LLC and Jefferies LLC, as representatives of the several initial purchasers named therein (collectively, the “Initial Purchasers”), to issue and sell $90,000 in aggregate principal amount of its 5.50% senior convertible notes due 2021 ("Convertible Notes") in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”) and to non-U.S. persons pursuant to Regulation S under the Securities Act. In December 2016, the Company entered into a purchase agreement (the “Cambridge Purchase Agreement”) with Cambridge Equities, L.P., an entity affiliated with Dr. Patrick Soon-Shiong, the Company’s Chairman and Chief Executive Officer (“Cambridge”), to issue and sell $10,000 in aggregate principal amount of the Convertible Notes in a private placement pursuant to an exemption from the registration requirements of the Securities Act afforded by Section 4(a)(2) of the Securities Act. In December 2016, pursuant to the exercise of the overallotment by the Initial Purchasers, the Company issued an additional $7,000 principal amount of the Convertible Notes. The total net proceeds from this offering were approximately $102,714 , $9,917 from Cambridge and $92,797 from the initial purchasers, after deducting of initial purchasers’ discount and debt issuance costs of $4,286 in connection with the Convertible Notes offering. On December 21, 2016, the Company entered into an Indenture, relating to the issuance of the Convertible Notes (the “Indenture”), by and between the Company and U.S. Bank National Association, as trustee (the “Trustee”). The interest rates are fixed at 5.50% per year, payable semi-annually on June 15 and December 15 of each year, beginning on June 15, 2017. The Convertible Notes will mature on December 15, 2021, unless earlier repurchased by the Company or converted pursuant to their terms. In connection with the offering of the Convertible Notes, on December 15, 2016, the Company entered into a Second Amended and Restated Promissory Note which amends and restates the Amended and Restated Promissory Note, dated May 9, 2016, between the Company and NantCapital, to, among other things, extend the maturity date of the Promissory Note to June 30, 2022 and to subordinate the Promissory Note in right of payment to the Convertible Notes (See Note 21). The initial conversion rate of the Convertible Notes is 82.3893 shares of common stock per $1 principal amount of Convertible Notes (which is equivalent to an initial conversion price of approximately $12.14 per share). Prior to the close of business on the business day immediately preceding September 15, 2021, the Convertible Notes will be convertible only under the following circumstances: (1) during any calendar quarter commencing after March 31, 2017 (and only during such calendar quarter), if, for at least 20 trading days (whether or not consecutive) during the 30 consecutive trading day period ending on the last trading day of the immediately preceding calendar quarter, the last reported sale price of the Company’s common stock on such trading day is greater than or equal to 120% of the conversion price on such trading day; (2) during the five business day period after any five consecutive trading day period in which, for each day of that period, the trading price per $1 principal amount of the Convertible Notes for such trading day was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on such trading day; or (3) upon the occurrence of specified corporate transactions as described in the Indenture agreement. Upon conversion, the Convertible Notes will be settled in cash, shares of the Company’s common stock or any combination thereof at the Company’s option. Upon the occurrence of a fundamental change (as defined in the Indenture), holders may require the Company to purchase all or a portion of the Convertible Notes in principal amounts of $1 or an integral multiple thereof, for cash at a price equal to 100% of the principal amount of the Convertible Notes to be purchased plus any accrued and unpaid interest to, but excluding, the fundamental change purchase date. The conversion rate will be subject to adjustment upon the occurrence of certain specified events. On or after the date that is one year after the last date of original issuance of the Convertible Notes, if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending within the five trading days immediately preceding a conversion date is greater than or equal to 120% of the conversion price on each applicable trading day, the Company will make an interest make-whole payment to a converting holder (other than a conversion in connection with a make-whole fundamental change in which the conversion rate is adjusted) equal to the sum of the present values of the scheduled payments of interest that would have been made on the Convertible Notes to be converted had such Convertible Notes remained outstanding from the conversion date through the earlier of (i) the date that is three years after the conversion date and (ii) the maturity date if the Convertible Notes had not been so converted. The present values of the remaining interest payments will be computed using a discount rate equal to 2.0% . The Company may pay any interest make-whole payment either in cash or in shares of its common stock, at the Company’s election as described in the Indenture. The Company accounts for convertible debt instruments that may be settled in cash upon conversion (including partial cash settlement) by recording the liability and equity components of the convertible debt separately. The liability component is computed based on the fair value of a similar liability that does not include the conversion option. The liability component includes both the value of the embedded interest make-whole derivative and the carrying value of the Convertible Notes. The equity component is computed based on the total debt proceeds less the fair value of the liability component. The equity component is also recorded as debt discount and amortized as interest expense over the expected term of the Convertible Notes. The liability component of the Convertible Notes on the date of issuance was computed as $83,079 , consisting of the value of the embedded interest make-whole derivative of $1,499 and the carrying value of the Convertible Notes of $81,580 . Accordingly, the equity component on the date of issuance was $23,921 . If the debt will be considered current at the balance sheet date, the liability component of the convertible notes will be classified as current liabilities and presented in current portion of convertible notes debt and the equity component of the convertible debt will be considered a redeemable security and presented as redeemable equity on the Company's Condensed and Consolidated Balance Sheet. Offering costs of $4,286 related to the issuance of the Convertible Notes are allocated to the liability and equity components in proportion to the allocation of the proceeds and accounted for as deferred financing offering costs and equity issuance costs, respectively. Approximately $972 of this amount was allocated to equity and the remaining $3,314 have been capitalized as deferred financing offering costs. The debt discounts and deferred financing offering costs on the Convertible Notes are being amortized to interest expense over the contractual terms of the Convertible Notes, using the effective interest method at an effective interest rate of 12.82% . As of December 31, 2016 , the remaining life of the Convertible Notes is approximately 60 months. The following table summarizes how the issuance of the Convertible Notes is reflected in the Company's Consolidated and Combined Balance sheet as of December 31, 2016 : Related party Others Total Gross proceeds $ 10,000 $ 97,000 $ 107,000 Interest make-whole derivative (148 ) (1,351 ) (1,499 ) Conversion option reported in equity as additional paid-in capital (2,233 ) (21,688 ) (23,921 ) Deferred financing offering costs (65 ) (3,249 ) (3,314 ) Amortization of debt discounts and deferred financing offering costs 10 98 108 Unamortized debt discounts and deferred financing offering costs (2,436 ) (26,190 ) (28,626 ) Net carrying amount $ 7,564 $ 70,810 $ 78,374 The following table sets forth the Company's interest expense incurred for the year ended December 31, 2016 : Related party Others Total Accrued coupon interest expense $ 15 $ 139 $ 154 Amortization of debt discounts 10 86 96 Amortization of deferred financing offering costs — 12 12 Total convertible notes interest expense $ 25 $ 237 $ 262 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Assets and liabilities measured at fair value on a recurring basis as of December 31, 2016 and 2015 consisted of the following: December 31, 2016 Total fair value Quoted price in active markets for identical assets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets Cash equivalents $ 149,067 $ 149,067 $ — $ — Marketable securities — — — — 149,067 149,067 — — Liabilities - Interest make-whole derivative 271 — — 271 December 31, 2015 Total fair value Quoted price in active markets for identical assets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets Cash equivalents $ 630 $ 630 $ — $ — Marketable securities 1,243 1,243 — — 1,873 1,873 — — The Company’s intangible assets and goodwill are initially measured at fair value and any subsequent adjustment to the initial fair value occurs only if an impairment charge is recognized. During the year ended December 31, 2016 and 2015 , there were no adjustments to the fair value of these assets. During the year ended December 31, 2014, the Company impaired certain of the intangible assets and adjusted these specific assets to fair value on such date (See Note 8). The fair values of the Company’s marketable securities and cash equivalents (consisting of mainly money market accounts) are based on quoted market prices in active markets with no valuation adjustment (See Note 8). Level 3 Inputs In December 2016, the Company issued $107,000 in aggregate principal amount of Convertible Notes due December 15, 2021, of which $10,000 issued to a related party (See Note 12). The Convertible Notes include an interest make-whole feature whereby if a noteholder converts any of the Convertible Notes one year after the last date of original issuance of the Convertible Notes, they are entitled, in addition to the other consideration payable or deliverable in connection with such conversion, to an interest make-whole payment equal to the sum of the present values of the scheduled payments, computed using a discount rate equal to 2.0% , of interest that would have been made on the Convertible Notes to be converted had such Convertible Notes remained outstanding from the conversion date through the earlier of (i) the date that is three years after the conversion date and (ii) the maturity date if the Convertible Notes had not been so converted. The Company may pay any interest make-whole payment either in cash or in shares of its common stock, at the Company’s election as described in the Indenture. The Company has determined that this feature is an embedded derivative and have recognized the fair value of this derivative as a liability in the Company's Condensed and Consolidated Balance Sheet, with subsequent changes to fair value recorded through earnings at each reporting period on the Company's Condensed and Consolidated Statements of Operations as change in fair value of derivative liability. The fair value of this embedded derivative was determined based on a binomial lattice model. The following tables set forth a summary of changes in the fair value of Level 3 liabilities for the year ended December 31, 2016 : December 31, 2015 Additions Change in fair value December 31, 2016 Interest make-whole derivative liability: Related party $ — $ 148 $ (123 ) $ 25 Others — 1,351 (1,105 ) 246 $ — $ 1,499 $ (1,228 ) $ 271 A s of December 31, 2016 , the fair value and carrying value of the Company's Convertible Notes were: Fair value Carrying value Face value 5.5% convertible senior notes due December 15, 2021: Related party $ 11,081 $ 7,564 $ 10,000 Others 107,491 70,810 97,000 $ 118,572 $ 78,374 $ 107,000 The fair value shown above represents the fair value of the total debt instrument, inclusive of both the liability and equity components, while the carrying value represents only the carrying value of the liability. Prior to the acquisition of NDO on June 18, 2014, the Company’s investment in NDO was accounted for at fair value on a recurring basis and was adjusted to fair value when the carrying value differed from fair value. The Company categorized NDO as a Level 3 investment due to the subjective nature of the unobservable inputs used. The fair values were estimated using an equally weighted combination of a discounted cash flow analysis and a market comparable approach. The significant inputs include a discount rate, long-term growth rate, financial projections, net working capital requirements, selected multiples, and a control premium. The following table presents the activity of the Company’s financial assets and liabilities that were measured at fair value using significant unobservable inputs during the year ended December 31, 2014: Amounts Balance at December 31, 2013 $ 13,833 Fair value adjustment 172 Derecognition upon acquisition (See Note 3) (14,005 ) Balance at December 31, 2014 $ — |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company's principal commitments consist of obligations under its outstanding debt obligations, non-cancelable leases for its office space and certain equipment and vendor contracts to provide research services, and purchase obligations under license agreements and reseller agreements. Lease Arrangements The Company leases both real estate and equipment used in its operations and classifies those leases as either operating or capital leases for accounting purposes. As of December 31, 2016 and 2015 , the Company had no material capital leases and the remaining lives of its operating leases ranged from one to five years . Rental expense associated with operating leases is charged to expense in the year incurred and is included in the Consolidated and Combined Statements of Operations. For the years ended December 31, 2016 , 2015 and 2014 the rental expense was charged to selling, general and administrative expense in the amount of $4,526 , $2,108 and $1,348 , respectively. As of December 31, 2016 , the Company’s future minimum rental commitments under its non-cancellable operating leases are as follows: Amounts 2017 $ 4,568 2018 2,539 2019 641 2020 508 2021 327 Total minimum rental commitments $ 8,583 Related Party Promissory Note On January 4, 2016, the Company executed a $112,666 demand promissory note in favor of NantCapital to fund the acquisition of NaviNet, On May 9, 2016 and December 15, 2016, the promissory note with NantCapital was amended to provide that all outstanding principal and accrued interest is due and payable on June 30, 2022, and not on demand (See Note 21 ). Indenture obligations under Convertible Notes On December 21, 2016, the Company entered into the Indenture relating to the issuance of the $107,000 Convertible Notes, by and between the Company and U.S. Bank National Association the Trustee. The interest rates are fixed at 5.50% per year, payable semi-annually on June 15 and December 15 of each year, beginning on June 15, 2017. The Convertible Notes will mature on December 15, 2021, unless earlier repurchased by the Company or converted pursuant to their terms (See Note 12). Purchase obligations Under License Agreements and Reseller Agreements In September 2016, the Company entered into a Second Amended and Restated Reseller Agreement for genomic and proteomic sequencing services and related bioinformatics and analysis services with NantOmics, with an effective date of June 19, 2015 (See Note 21 ). Obligations Under Exclusive License Agreement with Northshore On September 29, 2015, the Company entered into an exclusive license agreement with NorthShore to further develop their Health Heritage software platform ("Health Heritage"), and to license the software to customers (See Note 8). Regulatory Matters The Company is subject to regulatory oversight by the U.S. Food and Drug Administration and other regulatory authorities with respect to the development, manufacturing, and sale of some of the solutions. In addition, the Company is subject to the Health Insurance Portability and Accountability Act (“HIPAA”), the Health Information Technology for Economic and Clinical Health Act and related patient confidentiality laws and regulations with respect to patient information. The Company reviews the applicable laws and regulations regarding effects of such laws and regulations on its operations on an on-going basis and modifies operations as appropriate. The Company believes it is in substantial compliance with all applicable laws and regulations. Failure to comply with regulatory requirements could have a significant adverse effect on the Company’s business and operations. Legal Matters The Company is, from time to time, subject to claims and litigation that arise in the ordinary course of its business. The Company intends to defend vigorously any such litigation that may arise under all defenses that would be available. In the opinion of management, the ultimate outcome of proceedings of which management is aware, even if adverse to them, would not have a material adverse effect on the Company’s Consolidated and Combined Financial Condition or Results Of Operations. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors. See subsequent event related to securities litigation as described in Note 24. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The components of the provision for income taxes are presented in the following table: Year Ended December 31, 2016 2015 2014 Current: Federal $ 228 $ 338 $ — State 28 52 5 Foreign 318 15 — Total current provision 574 405 5 Deferred: Federal (11,864 ) — — State (2,671 ) — — Entity status change (8,725 ) — — Foreign (125 ) — — Total deferred benefit (23,385 ) — — Provision for (benefit from) income taxes, net $ (22,811 ) $ 405 $ 5 The provision for income taxes differs from the amount of income tax determined by applying the applicable U.S. statutory federal income tax rate to pretax loss as a result of the following differences: Year Ended December 31, 2016 2015 2014 United States federal tax at statutory rate 34.00 % 34.00 % 34.00 % Items affecting federal income tax rate: State tax rate, net of federal benefit 4.02 % 0.07 % — % Pass - through losses (7.04 )% (30.70 )% (26.50 )% Valuation allowance (28.04 )% (2.60 )% (5.90 )% LLC conversion to C corporation 10.29 % — % — % Stock compensation (1.08 )% — % — % Other adjustments (1.13 )% (1.47 )% (1.60 )% Effective income tax rate 11.02 % (0.70 )% — % P rior to June 1, 2016, NantHealth was a limited liability company taxed as partnership. It also owned a number of subsidiaries, including single member limited liability companies taxed as disregarded entities and corporations. As detailed in the table above, a significant amount of the Company’s losses before income taxes was generated by pass-through entities during the years ended December 31, 2015 and 2014. Since the losses of the pass-through entities flow directly to the members of the Company for tax purposes, no provision for income taxes was reflected in the Consolidated and Combined Financial Statements for these entities. The Company recorded a tax provision on its domestic and foreign corporate subsidiaries. From January 1, 2016 to May 31, 2016, the Company recorded an income tax benefit of $5,986 , mainly consisted of the deferred tax benefit from the amortization of NaviNet’s purchase accounting intangibles when NaviNet was a stand-alone corporation for tax purposes. On June 1, 2016, NantHealth converted from a limited liability company to a C corporation and formed a consolidated group with its domestic corporate subsidiaries for federal tax purposes. Upon the LLC conversion, the Company recorded $8,725 of tax benefit that represents the valuation allowance release to offset the purchase accounting deferred tax liability recorded on NaviNet’s separate company basis, and tax expense related to certain deferred tax liability arising from tax goodwill amortization. Going forward, the Company will record federal and state tax provision of the consolidated group, and foreign tax provision of its foreign subsidiaries. The Company's issuance of the Convertible Notes and the requirement for the Company to separately account for the Note liability (debt), and equity (conversion option), and make-whole liability (other liability) components of the Convertible Notes resulted in a difference between the carrying amount and the tax basis of the Convertible Notes. This temporary difference resulted in the Company recognizing a deferred tax liability for the temporary difference between the carrying value and the tax basis of the Convertible Notes excluding the make-whole liability , which was recorded as an adjustment to additional paid-in capital of $8,631 . The creation of the deferred tax liability recognized as a component of equity represents a source of future taxable income pursuant to ASC 740, " Income Taxes ”. The Company considered amounts recorded directly to equity in evaluating the need for a valuation allowance on deferred tax assets related to continuing operations. Accordingly, the Company recognized a tax benefit in continuing operations that represents the hypothetical realizable benefit of its current year operating losses resulting from the creation of the deferred tax liability in an amount equal to the $8,631 deferred tax liability that it recognized in connection with the issuance of the Convertible Notes. Significant components of the Company’s deferred tax assets and liabilities as of December 31, 2016 and 2015 are as follows: December 31, 2016 2015 Deferred income tax assets: Accounts payable and accrued expenses $ 3,231 $ 29 Inventory impairment 431 255 Deferred revenue 10,229 841 Allowance for doubtful accounts 124 399 Property, plant and equipment, net 3,279 131 Intangibles 2,918 36 Investments 15,653 — Stock compensation 11,574 — Other 1,144 59 Net operating loss carryforwards 93,974 37,387 Less: Valuation allowance (88,861 ) (30,850 ) Total deferred income tax assets 53,696 8,287 Deferred income tax liabilities: Accounts receivable, net (250 ) — State taxes (2,933 ) (1,290 ) Intangible assets, net (36,581 ) (6,812 ) Convertible notes (9,700 ) — Deferred implementation cost (3,753 ) — Other (1,233 ) (185 ) Total deferred income tax liabilities (54,450 ) (8,287 ) Deferred income taxes, net $ (754 ) $ — The realization of deferred income tax assets may be dependent on the Company’s ability to generate sufficient income in future years in the associated jurisdiction to which the deferred tax assets relate. The Company considers all available positive and negative evidence, including scheduled reversals of deferred income tax liabilities, projected future taxable income, tax planning strategies, and recent financial performance. Based on the review of all positive and negative evidence, including a three year cumulative pre-tax loss, the Company concluded that except for the deferred tax liability recorded on amortization of certain goodwill due to its indefinite life, it should record a full valuation allowance against all other net deferred income tax assets at December 31, 2016 and 2015 as none of these deferred income tax assets were more likely than not to be realized as of the balance sheet dates. However, the amount of the deferred income tax assets considered realizable may be adjusted if estimates of future taxable income during the carryforward period are increased or if objective negative evidence in the form of cumulative losses is no longer present. A summary of activity in the valuation reserve deducted from deferred tax assets for the years ended December 31, 2016 , 2015 and 2014 is as follows: Balance at beginning of the year Additions (Adjustments) Deductions Balance at the end of the year Year to Date December 31, 2016 $ 30,849 66,731 (8,719 ) $ 88,861 Year to Date December 31, 2015 $ 28,995 1,854 — $ 30,849 Year to Date December 31, 2014 $ 22,746 6,249 — $ 28,995 The Company records a tax benefit from uncertain tax positions only if it is more likely than not the tax position will be sustained with the taxing authority having full knowledge of all relevant information. The Company records a liability for unrecognized tax benefits from uncertain tax positions as discrete tax adjustments in the first period that the more-likely-than-not threshold is not met. As of December 31, 2016 and 2015 , the Company had approximately $ 977 and $879 , respectively, of unrecognized tax benefits , without interest or penalty, all of which would impact the effective tax rate if recognized . The unrecognized tax benefits are recorded consistent with ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the Emerging Issues Task Force), in two parts. The first part is recorded as a reduction of the gross deferred income tax asset in the amount of $382 and the second part is recorded as an increase to income tax payable in the amount of $595 . December 31, 2016 2015 Balance as of January 1 $ 879 $ — Increases related to tax positions taken during the current year 98 879 Balance as of December 31 $ 977 $ 879 The Company’s policy is to recognize interest and penalties related to uncertain tax positions in income tax expense. As of December 31, 2016 and 2015 , there are no material interest and penalties associated with unrecognized tax benefits recorded in our consolidated statement of operations or balance sheet. Any changes to unrecognized tax benefits recorded as of December 31, 2016 that are reasonably possible to occur within the next 12 months are not expected to be material. One of the Company’s corporate subsidiary, Assisteo Holding, Inc, is currently under an IRS audit for the tax year 2014. The Company is no longer subject to income tax examination by the U.S. federal, state or local tax authorities for years ended December 31, 2011 or prior, however, its tax attributes, such as net operating loss (“NOL”) carryforwards and tax credits, are still subject to examination in the year they are used. As of December 31, 2016 , the Company had federal, state and foreign NOL carryforwards of $238,865 , $169,840 and $2,565 , respectively, expiring at various dates through 2036 . Utilization of the NOL carryforwards is subject to annual limitations due to ownership change limitations that occurred or could occur in the future as provided by Section 382 of the Internal Revenue Code of 1986, as amended, as well as similar state and foreign provisions. These ownership changes may limit the amount of the NOL carryforwards that can be utilized annually to offset future taxable income. The total NOL amounts above do not include the NOLs expected to expire. As of December 31, 2016, we had an immaterial amount of unremitted earnings related to certain foreign subsidiaries that were indefinitely reinvested. Since these unremitted earnings have been indefinitely reinvested, deferred taxes were not provided. The unrecognized deferred tax liability associated with these unremitted earnings is immaterial As described in Note 2, the Company early adopted ASU 2016-06, Improvements to Employee Share-Based Payment Accounting, simplifying the accounting for employee share-based payment transactions, including the accounting for income taxes and statutory withholding requirements. Because of the Company's current valuation allowance position, the adoption of ASC 2016-09 did not result in current tax expense or benefit related to vested stock awards during the year ended December 31, 2016. As a result, the Company did not exclude any excess tax benefits from the calculation of diluted earnings per share during the year ended December 31, 2016, and there was no method change to the cash flow presentation as required by ASU 2016-09. |
Redeemable Series F Units _ Com
Redeemable Series F Units / Common Stock | 12 Months Ended |
Dec. 31, 2016 | |
Temporary Equity Disclosure [Abstract] | |
Redeemable Series F Units/Common Stock | Redeemable Series F Units / Common Stock On June 20, 2014, the Kuwait Investment Office (“KIO”) purchased 53,580,996 Series F units of the Company through a Delaware blocker corporation, KHealth Holdings, Inc. (“KHealth”), at a purchase price of $2.7995 per unit for an aggregate amount of $150,000 . KIO is the London Office of the Kuwait Investment Authority (“KIA”). As part of the investment, KIO had the right and option, but not the obligation, to require NantHealth to redeem 100% of the outstanding shares of KHealth at an amount equal to the original purchase price of $150,000 plus accrued annual interest of 7.0% if the Company had not (i) filed a registration statement on Form S-1 with the Securities and Exchange Commission on or before December 20, 2015 or (ii) had not completed a qualified initial public offering on or before June 20, 2016 (the “Put Right”). KIO did not exercise the Put Right, and it expired as of June 20, 2016. As of December 31, 2015 , the Company determined that the redemption of the Series F units was probable due to the uncertainty of completing a qualified initial public offering under prong (ii) and, as such, accrued $16,042 of interest as a reduction to members’ equity. Prior to December 31, 2015, the Company had concluded that redemption was not probable and had not adjusted the carrying value of such units to redemption value. The Series F units were classified in the Consolidated and Combined balance sheet as of December 31, 2015 as temporary equity as a result of the contingent redemption feature. As part of the LLC Conversion, the Series F units converted to 10,714,285 shares of redeemable common stock as of June 1, 2016. Since the Put Right expired unexercised on June 20, 2016, the shares of common stock owned by KIO are no longer redeemable and are included in Stockholders’ equity. The change in net carrying amount of the Series F units and common stock owned by KIO for the years ended December 31, 2016 , 2015 and 2014 consisted of the following: Redeemable Series F Units Redeemable Common Stock Common Stock and Additional-Paid-in-Capital Balance at December 31, 2013 $ — $ — $ — Issuance of units 150,000 — — Balance at December 31, 2014 150,000 — — Accretion to redemption value 16,042 — — Balance at December 31, 2015 166,042 — — Accretion to redemption value 4,375 — — Balance at June 1, 2016 pre-LLC Conversion 170,417 — — LLC Conversion (170,417 ) 170,417 — Balance at June 1, 2016 post-LLC Conversion — 170,417 — Accretion to redemption value — 583 — Balance at June 20, 2016 pre expiration of Put Right — 171,000 — Expiration of Put Right at June 20, 2016 — (171,000 ) 171,000 Balance at June 20, 2016 post expiration of Put Right and at December 31, 2016 $ — $ — $ 171,000 Letter Agreement with NantWorks On May 22, 2016, the Company signed a letter agreement with NantWorks whereby NantWorks agreed to purchase directly from KIO all of the outstanding shares of KHealth if KIO had elected to exercise its Put Right. KIO did not exercise its Put Right (which expired by its terms on June 20, 2016) and NantWorks, therefore did not purchase these shares. Stockholders’ Equity Initial Public Offering On June 7, 2016, the Company completed its IPO of 6,500,000 shares of common stock at a public offering price of $14.00 per share. Additionally, on June 9, 2016, the underwriters partially exercised their overallotment option to purchase an additional 400,000 shares of the common stock at $14.00 per share. The Company received $83,566 in proceeds from its IPO, after deducting underwriting discounts and commissions and offering costs of $13,034 . In connection with the pricing of the Company’s IPO on June 1, 2016, $40,590 of principal and accrued interest on the Company’s related party promissory notes with NantOmics was converted into 2,899,297 shares of the Company’s common stock. On July 25, 2016, the Company issued 1,056,689 shares of common stock, after withholding of approximately 538,794 shares to satisfy tax withholding obligations, to participants of the Phantom Unit Plan based in the United States whose phantom units vested as a result of the IPO. The Company made a cash payment of $5,738 to cover employee withholding taxes upon the settlement of these vested phantom units. The Company also paid $235 on August 9, 2016 to cash-settle 16,818 vested phantom units held by participants of the Phantom Unit Plan at the time of the IPO who were based outside of the United States. LLC Conversion and Reverse Split Upon completion of the LLC Conversion on June 1, 2016, (a) all of the Company’s outstanding units automatically converted into shares of common stock, based on the relative rights of the Company's pre-IPO equityholders as set forth in the Company's limited liability company agreement (the "LLC Agreement") and (b) the Company adopted and filed a certificate of incorporation with the Secretary of State of the state of Delaware and adopted bylaws. The Company adopted and filed an amendment to its certificate of incorporation (the "Amended Certificate of Incorporation") with the Secretary of State of the state of Delaware to effect a 1 -for- 5.5 reverse stock split of its common stock on June 1, 2016. Below is a summary of the number of member units pre LLC Conversion as converted into common shares: Pre Conversion (Units) Former Series A Unit Holders 420,255,676 Former Series B Unit Holders 19,109,603 Former Series C Unit Holders 3,470,254 Former Series D Unit Holders 3,572,066 Former Series E Unit Holders 35,720,664 Former Series G Unit Holders 59,099,908 Former Series H Unit Holders 15,513,726 Total Member Units 556,741,897 The units in the table above were converted to 99,661,906 shares of common stock, of which 10,462 shares of restricted stock. The members’ equity balance of $525,388 was reclassified into common stock and additional paid-in capital in the Consolidated and Combined Balance Sheet as of June 1, 2016. LLC Agreement and Amended Certificate of Incorporation Prior to the LLC Conversion, the Company’s operations were governed by its LLC Agreement. Upon the consummation of the LLC Conversion, the Company converted into a corporation, and the LLC Agreement no longer governs the Company's operations or the rights of its equityholders. The LLC Agreement provided that the board of directors had the power and discretion to manage and control the business, property and affairs of the company, but that certain actions required the consent of certain of the Company's former members. Under the LLC Agreement, the Company had units authorized, including Series A through H units. Each equityholder holding Series A, B, D, E, F, G or H units had one vote for each unit held. Profits interests units awarded under the Nant Health, LLC Profits Interests Plan (the "Profits Interests Plan") took the form of Series C units of the Company. Holders of Series C units did not have the right to vote. The LLC Agreement also set forth the rights of and restrictions on unitholders, including certain rights of first refusal and preemptive and co-sale rights. The LLC Agreement also provided that, upon the LLC Conversion, the allocation of shares of the Company's common stock among the pre-IPO equityholders was dependent upon the IPO price of its common stock, based on the relative rights of the pre-IPO equityholders as set forth in the LLC Agreement. As a result, as part of the LLC Conversion, the Company set the actual allocation of shares among its pre-IPO equityholders based upon the IPO price of its common stock. Concurrently with the consummation of the LLC Conversion, the LLC Agreement was terminated, other than certain provisions relating to certain pre-termination tax matters and certain liabilities. In accordance with the Company’s amended and restated certificate of incorporation, which was filed immediately following the closing of its IPO, the Company is authorized to issue 750,000,000 shares of common stock, with a par value of $0.0001 per share, and 20,000,000 shares of undesignated preferred stock, with a par value of $0.0001 per share. Holders of the Company’s common stock are entitled to one vote for each share held on all matters submitted to a vote of its stockholders. Holders of the Company’s common stock have no cumulative voting rights. Further, as of December 31, 2016 , holders of the Company’s common stock have no preemptive, conversion, redemption or subscription rights and there are no sinking fund provisions applicable to the Company’s common stock. Upon liquidation, dissolution or winding-up of the Company, holders of the Company’s common stock are entitled to share ratably in all assets remaining after payment of all liabilities and the liquidation preferences of any outstanding shares of preferred stock. Subject to preferences that may be applicable to any outstanding shares of preferred stock, holders of the Company’s common stock are entitled to receive dividends, if any, as may be declared from time to time by the Company’s board of directors. As of December 31, 2016 , there were no outstanding shares of preferred stock. 2016 Equity Issuances NaviNet On January 1, 2016, the Company issued 15,513,726 Series H units to 3BE Holdings, LLC for the acquisition of NaviNet at a purchase price of $3.3841 per unit for an aggregate amount of $52,500 . The Series H units had substantially the same rights and preferences as the former Series B, D, E, F and G units that were outstanding at the time. On June 1, 2016, the Series H units issued to 3BE Holdings, LLC were converted into 3,749,998 shares of the Company’s common stock. 2015 Equity Issuances Allscripts Investment On June 29, 2015, the Company issued 59,099,908 Series G units to Allscripts Healthcare Solutions, Inc. (“Allscripts”), at a purchase price of $3.3841 per unit for an aggregate amount of $200,000 . The Series G units had substantially the same rights and preferences as the former Series B, D, E and F units that were outstanding at the time. On June 1, 2016, the Series G units issued to Allscripts were converted into 14,285,714 shares of the Company’s common stock. 2014 Equity Issuances Blackberry Investment On March 31, 2014, the Company issued 3,572,031 Series D units to BlackBerry Corporation, a leader in mobile communications, at a purchase price of $2.7995 per unit for an aggregate amount of $10,000 . The two companies are collaborating on the development of HIPAA-certified integrated clinical systems that transform the delivery of medical care. On June 1, 2016, the Series D units issued to BlackBerry Corporation were converted into 597,037 shares of the Company’s common stock. KIA Investment On April 28, 2014, KIA, through a Delaware blocker corporation, made a $100,000 investment in the Company in exchange for 35,720,664 Series E units at a purchase price of $2.7995 per unit. On June 1, 2016, the Series E units issued to KIA were converted into 5,000,002 shares of the Company’s common stock. Blackstone and Other Investment In July 2014, the Company issued 3,572,031 Series A units to the Blackstone Group (“Blackstone”) in accordance with an Exchange Agreement executed during 2013. The issuance of the equity only resulted in an adjustment to the number of the issued and outstanding membership interests since the consideration from Blackstone was received in 2013 (See Note 21 ). Additionally, the Company issued 187,550 Series A units to an investor affiliated with Blackstone in exchange for $525 in cash. On June 1, 2016, the Series A units issued to Blackstone Group were converted into 31,347 shares of the Company’s common stock. Other Equity Contributions In January 2015, the Company entered into an agreement to provide certain research related sequencing services to a research institution. The agreement provides that the institution pay the Company $10,000 in exchange for the Company providing sequencing services. Certain public and private charitable 501(c)(3) non-profit organizations provided partial funding for the sequencing and related bioinformatics costs associated with the project. The Company’s Chairman and CEO serves as the CEO and a member of the board of directors of each of the non-profit organizations and by virtue of these positions he may have influence or control over these organizations. The institution was not contractually or otherwise required to use the Company’s molecular profiling solutions or any of the Company’s other products or services as part of the charitable gift, however, the institution did not have a requirement to order or pay for the services unless it first received private donor funding for the project. As a result, the Company does not classify the fees related to this project as revenue but instead classifies the amounts as deemed capital contributions from the Company's Chairman and CEO. During the years ended December 31, 2016 and 2015, $3,810 and $6,190 respectively, was recorded as a deemed capital contribution within members' equity or stockholders' equity. During the years ended December 31, 2016 and 2015 , $2,286 and $3,714 of costs, respectively, were recorded as other services cost of revenue related to the service performed. In December 2016, the Company entered into an agreement to provide genomic and proteomic sequencing and related bioinformatics services to an institution related to cancer research. The agreement provides that the institution pay the Company a fixed per-test fee in exchange for the services to be provided by the Company. A private charitable 501(c)(3) non-profit organization controlled by the Company’s Chairman and CEO also made a charitable gift to the institution in December 2016. The gift does not contractually or otherwise require the institution to use the Company’s molecular profiling solutions or any of the Company’s other products or services. No amounts related to this arrangement have been recognized in the Company’s Consolidated and Combined Balance Sheets or Statements of Operations as of or for the year ended December 31, 2016 . |
Non-Controlling Interests
Non-Controlling Interests | 12 Months Ended |
Dec. 31, 2016 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling Interests | Non-Controlling Interests During the years ended December 31, 2016 and 2015 there were no non-controlling interests outstanding for NantHealth’s subsidiaries. During a portion of 2014, there were non-controlling interests outstanding for certain of NantHealth’s subsidiaries. As of December 31, 2014, however, there were no non-controlling interests outstanding as NantHealth owned 100% of each of its subsidiaries as a result of the transactions described below. While the non-controlling interests were outstanding, the Company attributed the losses of these subsidiaries to the non-controlling interests using the HLBV method as this methodology best represented the economics of the non-controlling interests’ share of the subsidiaries’ losses for each period. Under the HLBV method, the non-controlling interests were determined at each balance sheet date by calculating the amount the non-controlling interests would receive (or be obligated to pay) if the subsidiaries’ assets were liquidated at book value, all outstanding expenses and debts were paid off, and the resulting cash was distributed to the investors of that subsidiary in accordance with the terms of the governing contractual arrangements. The difference between this amount at the beginning and end of each reporting period represented the non-controlling interests’ share of the subsidiaries’ net losses for that period. The net loss attributable to the members of NantHealth equal to the total Consolidated and Combined Net Loss less the Net Loss Attributable To the Non-Controlling Interests. Buyout of eviti non-controlling interests In September and October of 2014, NantHealth acquired the non-controlling interests in eviti in exchange for issuing 567,930 of its Series A units and 1,515 Series C units to replace any unexercised, in-the-money stock options of eviti. The carrying value of the non-controlling interest was derecognized as of September 25, 2014 and the value was reclassified to NantHealth’s Series A members’ equity. On June 1, 2016, the Series A units and Series C units issued to non-controlling interests in eviti were converted into 94,908 shares of the Company’s common stock. Buyout of iSirona non-controlling interests On December 31, 2012, the Company acquired the non-controlling interests in iSirona, LLC ("iSirona") for total consideration of up to $20,202 in cash and issuance of up to 9,197,700 of the Company’s Series A units. The Company made an upfront payment to the former unit holders of iSirona of $13,468 in cash and issued 6,131,800 Series A units and also agreed to pay an earn-out in 2014 if iSirona achieved a certain revenue target during calendar year 2013. On June 1, 2016, the Series A units issued to former unit holders of iSirona were converted into 1,024,877 shares of the Company’s common stock. The carrying value of the non-controlling interest was derecognized as of December 31, 2012 and the difference between this amount and the sum of (i) the $13,468 upfront cash payment and (ii) the 6,131,800 of the Company’s units measured at fair value was recognized in Series A members’ equity. The fair value of the units at this date was the same price per unit paid by Verizon in October 2012, or $1.00 per unit. In June 2014, the Company paid $5,608 in cash and issued 2,553,238 Series A units as payment of the earn-out associated with the purchase of the non-controlling interest in iSirona that occurred on December 31, 2012. The calculation of the earn-out payment was based on measuring the percentage of the revenue milestone that was achieved according to the terms of the earn-out outlined in the Agreement and Plan of Merger between NantHealth and iSirona as of December 31, 2012. The amounts paid to the non-employees in cash or through issuance of the Company’s Series A units were recognized as additional consideration to purchase the non-controlling interest in May 2014, the period when NantHealth determined the revenue target had been achieved. On June 1, 2016, the Series A units issued for the purchase of the non-controlling interest in iSirona were converted into 426,754 shares of the Company’s common stock. The cash paid and equity issued to associates were treated as compensation expense since the payment required these associates to remain employed with the Company through the payment date. During the year ended December 31, 2014, the Company recognized $105 of stock-based compensation expense based on the earn-out that was paid to associates in the form of Series A units. The following table shows the effects of changes in NantHealth’s ownership interest in its subsidiaries on NantHealth’s members’ equity during the year ended December 31, 2014: Amounts Net loss attributable to NantHealth $ (84,425 ) Transfers to (from) the non-controlling interests: Increase in NantHealth’s Series A members’ equity upon sale of Qi Imaging (See Note 21) 5,439 Decrease in NantHealth’s Series A members’ equity for acquisition of eviti’s non-controlling interests (75 ) Decrease in NantHealth’s Series A members’ equity for acquisition of iSirona’s non-controlling interests (4,817 ) Net transfers to (from) non-controlling interests 547 Change from net loss attributable to NantHealth and transfers to (from) the non-controlling interests $ (83,878 ) |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Stockholders' Equity | Redeemable Series F Units / Common Stock On June 20, 2014, the Kuwait Investment Office (“KIO”) purchased 53,580,996 Series F units of the Company through a Delaware blocker corporation, KHealth Holdings, Inc. (“KHealth”), at a purchase price of $2.7995 per unit for an aggregate amount of $150,000 . KIO is the London Office of the Kuwait Investment Authority (“KIA”). As part of the investment, KIO had the right and option, but not the obligation, to require NantHealth to redeem 100% of the outstanding shares of KHealth at an amount equal to the original purchase price of $150,000 plus accrued annual interest of 7.0% if the Company had not (i) filed a registration statement on Form S-1 with the Securities and Exchange Commission on or before December 20, 2015 or (ii) had not completed a qualified initial public offering on or before June 20, 2016 (the “Put Right”). KIO did not exercise the Put Right, and it expired as of June 20, 2016. As of December 31, 2015 , the Company determined that the redemption of the Series F units was probable due to the uncertainty of completing a qualified initial public offering under prong (ii) and, as such, accrued $16,042 of interest as a reduction to members’ equity. Prior to December 31, 2015, the Company had concluded that redemption was not probable and had not adjusted the carrying value of such units to redemption value. The Series F units were classified in the Consolidated and Combined balance sheet as of December 31, 2015 as temporary equity as a result of the contingent redemption feature. As part of the LLC Conversion, the Series F units converted to 10,714,285 shares of redeemable common stock as of June 1, 2016. Since the Put Right expired unexercised on June 20, 2016, the shares of common stock owned by KIO are no longer redeemable and are included in Stockholders’ equity. The change in net carrying amount of the Series F units and common stock owned by KIO for the years ended December 31, 2016 , 2015 and 2014 consisted of the following: Redeemable Series F Units Redeemable Common Stock Common Stock and Additional-Paid-in-Capital Balance at December 31, 2013 $ — $ — $ — Issuance of units 150,000 — — Balance at December 31, 2014 150,000 — — Accretion to redemption value 16,042 — — Balance at December 31, 2015 166,042 — — Accretion to redemption value 4,375 — — Balance at June 1, 2016 pre-LLC Conversion 170,417 — — LLC Conversion (170,417 ) 170,417 — Balance at June 1, 2016 post-LLC Conversion — 170,417 — Accretion to redemption value — 583 — Balance at June 20, 2016 pre expiration of Put Right — 171,000 — Expiration of Put Right at June 20, 2016 — (171,000 ) 171,000 Balance at June 20, 2016 post expiration of Put Right and at December 31, 2016 $ — $ — $ 171,000 Letter Agreement with NantWorks On May 22, 2016, the Company signed a letter agreement with NantWorks whereby NantWorks agreed to purchase directly from KIO all of the outstanding shares of KHealth if KIO had elected to exercise its Put Right. KIO did not exercise its Put Right (which expired by its terms on June 20, 2016) and NantWorks, therefore did not purchase these shares. Stockholders’ Equity Initial Public Offering On June 7, 2016, the Company completed its IPO of 6,500,000 shares of common stock at a public offering price of $14.00 per share. Additionally, on June 9, 2016, the underwriters partially exercised their overallotment option to purchase an additional 400,000 shares of the common stock at $14.00 per share. The Company received $83,566 in proceeds from its IPO, after deducting underwriting discounts and commissions and offering costs of $13,034 . In connection with the pricing of the Company’s IPO on June 1, 2016, $40,590 of principal and accrued interest on the Company’s related party promissory notes with NantOmics was converted into 2,899,297 shares of the Company’s common stock. On July 25, 2016, the Company issued 1,056,689 shares of common stock, after withholding of approximately 538,794 shares to satisfy tax withholding obligations, to participants of the Phantom Unit Plan based in the United States whose phantom units vested as a result of the IPO. The Company made a cash payment of $5,738 to cover employee withholding taxes upon the settlement of these vested phantom units. The Company also paid $235 on August 9, 2016 to cash-settle 16,818 vested phantom units held by participants of the Phantom Unit Plan at the time of the IPO who were based outside of the United States. LLC Conversion and Reverse Split Upon completion of the LLC Conversion on June 1, 2016, (a) all of the Company’s outstanding units automatically converted into shares of common stock, based on the relative rights of the Company's pre-IPO equityholders as set forth in the Company's limited liability company agreement (the "LLC Agreement") and (b) the Company adopted and filed a certificate of incorporation with the Secretary of State of the state of Delaware and adopted bylaws. The Company adopted and filed an amendment to its certificate of incorporation (the "Amended Certificate of Incorporation") with the Secretary of State of the state of Delaware to effect a 1 -for- 5.5 reverse stock split of its common stock on June 1, 2016. Below is a summary of the number of member units pre LLC Conversion as converted into common shares: Pre Conversion (Units) Former Series A Unit Holders 420,255,676 Former Series B Unit Holders 19,109,603 Former Series C Unit Holders 3,470,254 Former Series D Unit Holders 3,572,066 Former Series E Unit Holders 35,720,664 Former Series G Unit Holders 59,099,908 Former Series H Unit Holders 15,513,726 Total Member Units 556,741,897 The units in the table above were converted to 99,661,906 shares of common stock, of which 10,462 shares of restricted stock. The members’ equity balance of $525,388 was reclassified into common stock and additional paid-in capital in the Consolidated and Combined Balance Sheet as of June 1, 2016. LLC Agreement and Amended Certificate of Incorporation Prior to the LLC Conversion, the Company’s operations were governed by its LLC Agreement. Upon the consummation of the LLC Conversion, the Company converted into a corporation, and the LLC Agreement no longer governs the Company's operations or the rights of its equityholders. The LLC Agreement provided that the board of directors had the power and discretion to manage and control the business, property and affairs of the company, but that certain actions required the consent of certain of the Company's former members. Under the LLC Agreement, the Company had units authorized, including Series A through H units. Each equityholder holding Series A, B, D, E, F, G or H units had one vote for each unit held. Profits interests units awarded under the Nant Health, LLC Profits Interests Plan (the "Profits Interests Plan") took the form of Series C units of the Company. Holders of Series C units did not have the right to vote. The LLC Agreement also set forth the rights of and restrictions on unitholders, including certain rights of first refusal and preemptive and co-sale rights. The LLC Agreement also provided that, upon the LLC Conversion, the allocation of shares of the Company's common stock among the pre-IPO equityholders was dependent upon the IPO price of its common stock, based on the relative rights of the pre-IPO equityholders as set forth in the LLC Agreement. As a result, as part of the LLC Conversion, the Company set the actual allocation of shares among its pre-IPO equityholders based upon the IPO price of its common stock. Concurrently with the consummation of the LLC Conversion, the LLC Agreement was terminated, other than certain provisions relating to certain pre-termination tax matters and certain liabilities. In accordance with the Company’s amended and restated certificate of incorporation, which was filed immediately following the closing of its IPO, the Company is authorized to issue 750,000,000 shares of common stock, with a par value of $0.0001 per share, and 20,000,000 shares of undesignated preferred stock, with a par value of $0.0001 per share. Holders of the Company’s common stock are entitled to one vote for each share held on all matters submitted to a vote of its stockholders. Holders of the Company’s common stock have no cumulative voting rights. Further, as of December 31, 2016 , holders of the Company’s common stock have no preemptive, conversion, redemption or subscription rights and there are no sinking fund provisions applicable to the Company’s common stock. Upon liquidation, dissolution or winding-up of the Company, holders of the Company’s common stock are entitled to share ratably in all assets remaining after payment of all liabilities and the liquidation preferences of any outstanding shares of preferred stock. Subject to preferences that may be applicable to any outstanding shares of preferred stock, holders of the Company’s common stock are entitled to receive dividends, if any, as may be declared from time to time by the Company’s board of directors. As of December 31, 2016 , there were no outstanding shares of preferred stock. 2016 Equity Issuances NaviNet On January 1, 2016, the Company issued 15,513,726 Series H units to 3BE Holdings, LLC for the acquisition of NaviNet at a purchase price of $3.3841 per unit for an aggregate amount of $52,500 . The Series H units had substantially the same rights and preferences as the former Series B, D, E, F and G units that were outstanding at the time. On June 1, 2016, the Series H units issued to 3BE Holdings, LLC were converted into 3,749,998 shares of the Company’s common stock. 2015 Equity Issuances Allscripts Investment On June 29, 2015, the Company issued 59,099,908 Series G units to Allscripts Healthcare Solutions, Inc. (“Allscripts”), at a purchase price of $3.3841 per unit for an aggregate amount of $200,000 . The Series G units had substantially the same rights and preferences as the former Series B, D, E and F units that were outstanding at the time. On June 1, 2016, the Series G units issued to Allscripts were converted into 14,285,714 shares of the Company’s common stock. 2014 Equity Issuances Blackberry Investment On March 31, 2014, the Company issued 3,572,031 Series D units to BlackBerry Corporation, a leader in mobile communications, at a purchase price of $2.7995 per unit for an aggregate amount of $10,000 . The two companies are collaborating on the development of HIPAA-certified integrated clinical systems that transform the delivery of medical care. On June 1, 2016, the Series D units issued to BlackBerry Corporation were converted into 597,037 shares of the Company’s common stock. KIA Investment On April 28, 2014, KIA, through a Delaware blocker corporation, made a $100,000 investment in the Company in exchange for 35,720,664 Series E units at a purchase price of $2.7995 per unit. On June 1, 2016, the Series E units issued to KIA were converted into 5,000,002 shares of the Company’s common stock. Blackstone and Other Investment In July 2014, the Company issued 3,572,031 Series A units to the Blackstone Group (“Blackstone”) in accordance with an Exchange Agreement executed during 2013. The issuance of the equity only resulted in an adjustment to the number of the issued and outstanding membership interests since the consideration from Blackstone was received in 2013 (See Note 21 ). Additionally, the Company issued 187,550 Series A units to an investor affiliated with Blackstone in exchange for $525 in cash. On June 1, 2016, the Series A units issued to Blackstone Group were converted into 31,347 shares of the Company’s common stock. Other Equity Contributions In January 2015, the Company entered into an agreement to provide certain research related sequencing services to a research institution. The agreement provides that the institution pay the Company $10,000 in exchange for the Company providing sequencing services. Certain public and private charitable 501(c)(3) non-profit organizations provided partial funding for the sequencing and related bioinformatics costs associated with the project. The Company’s Chairman and CEO serves as the CEO and a member of the board of directors of each of the non-profit organizations and by virtue of these positions he may have influence or control over these organizations. The institution was not contractually or otherwise required to use the Company’s molecular profiling solutions or any of the Company’s other products or services as part of the charitable gift, however, the institution did not have a requirement to order or pay for the services unless it first received private donor funding for the project. As a result, the Company does not classify the fees related to this project as revenue but instead classifies the amounts as deemed capital contributions from the Company's Chairman and CEO. During the years ended December 31, 2016 and 2015, $3,810 and $6,190 respectively, was recorded as a deemed capital contribution within members' equity or stockholders' equity. During the years ended December 31, 2016 and 2015 , $2,286 and $3,714 of costs, respectively, were recorded as other services cost of revenue related to the service performed. In December 2016, the Company entered into an agreement to provide genomic and proteomic sequencing and related bioinformatics services to an institution related to cancer research. The agreement provides that the institution pay the Company a fixed per-test fee in exchange for the services to be provided by the Company. A private charitable 501(c)(3) non-profit organization controlled by the Company’s Chairman and CEO also made a charitable gift to the institution in December 2016. The gift does not contractually or otherwise require the institution to use the Company’s molecular profiling solutions or any of the Company’s other products or services. No amounts related to this arrangement have been recognized in the Company’s Consolidated and Combined Balance Sheets or Statements of Operations as of or for the year ended December 31, 2016 . |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Based Compensation | Stock Based Compensation The following table reflects the components of stock-based compensation expense recognized in the Company's Consolidated and Combined Statements of Operations: Year Ended December 31, 2016 2015 2014 Series C / Restricted Stock - Research and development $ (238 ) $ 1,429 $ 340 Phantom units: Cost of revenue 8,415 — — Selling, general and administrative 28,534 — — Research and development 17,187 — — Total phantom units stock-based compensation expense 54,136 — — Stock options - Selling, general and administrative 54 — — Total stock-based compensation expense 53,952 1,429 340 Amount capitalized to internal-use software and deferred implementation costs 2,433 — — Total stock-based compensation cost $ 56,385 $ 1,429 $ 340 Retired Profits Interests Plan On December 3, 2013, the Company adopted the Profits Interests Plan under which it had reserved an aggregate of 63,750,000 Series C units for issuance to associates, consultants and contractors of the Company in consideration for bona fide services provided to the Company. The Series C units were considered profits interests of the Company and did not entitle their holders (the “Series C Members”) to receive distributions if the Company were liquidated immediately after the grant. Instead, the Series C Members were entitled to receive an allocation of a portion of the profit and loss of the Company arising after the date of the grant and, subject to vesting conditions, distributions made out of a portion of the profits of the Company arising after the grant date of the Series C units. Grants of the Series C units were either fully vested, partially vested, or entirely unvested at the time of the grant as determined by the Board. Series C Members were not entitled to receive any distributions until the aggregate distributions made by the Company exceeded a hurdle amount applicable to those Series C units. The hurdle amount for each grant was determined by the Board at the date of issuance of such units. After all other members received their applicable hurdle amount, the Series C Members were entitled to receive their percentage interest of such excess distributions. As of December 31, 2015 and through the date of the LLC Conversion, the Company had 3,470,254 Series C units outstanding. Upon the LLC Conversion (See Note 18) on June 1, 2016, the Company issued 28,973 shares of common stock to holders of vested Series C units and 10,462 shares of restricted stock to holders of unvested Series C units. The shares of restricted stock issued to holders of unvested profits interests are subject to forfeiture until becoming fully vested in accordance with the terms of the original Series C unit grant agreements (See Restricted Stock below). Phantom Unit Plan On March 31, 2015, the Company approved the Nant Health, LLC Phantom Unit Plan (the “Phantom Unit Plan”). The maximum number of phantom units that may be issued under the Phantom Plan is equal to 11,590,909 minus the number of issued and outstanding Series C units of the Company. As of December 31, 2016 , there were 4,322,081 phantom units outstanding under the Phantom Unit Plan, after giving effect to the 1 -for- 5.5 reverse stock split. Each grant of phantom units made to a participant under the Phantom Unit Plan vests over a defined service period, subject to completion of a liquidity event. The Company’s IPO satisfied the liquidity event condition and the phantom units now entitle their holders to cash or non-cash payments in an amount equal to the number of vested units held by that participant multiplied by the fair market value of one share of the Company’s common stock at the Company's option on the date each phantom unit vests. After the Company’s IPO, the Company will no longer issue any units under the Phantom Unit Plan. The Company intends to settle all vested phantom unit payments held by United States-based participants in shares of the Company’s common stock and classifies these awards as equity awards in its Consolidated and Combined Balance Sheet. Awards held by participants who are based outside of the United States are estimated to be settled in cash and are classified within accrued expenses on the Consolidated and Combined Balance Sheet as of December 31, 2016 . The following table summarizes the activity related to the unvested phantom units during the years ended December 31, 2016 , 2015 and 2014 : Number of Units Weighted Average Grant date value per phantom unit Unvested phantom units outstanding - December 31, 2013 and 2014 — — Granted 5,079,187 $15.78 Vested — — Forfeited (1,356,273 ) $15.79 Unvested phantom units outstanding - December 31, 2015 3,722,914 $15.78 Granted 3,024,430 $14.07 Vested (1,638,617 ) $15.02 Forfeited (786,646 ) $15.38 Unvested phantom units outstanding - December 31, 2016 4,322,081 $14.95 During the year ended December 31, 2016 , the Company granted 995,364 phantom units to employees of related companies who are providing services to the Company under the shared services agreement with NantWorks (See Note 21 ) as well as certain consultants of the Company. Stock compensation expense for the phantom units issued to these participants is re-measured at the end of each reporting period until the awards vest. All other grants of phantom units have been made to employees of the Company. The Company uses the accelerated attribution method to recognize expense for all phantom units since the awards’ vesting was subject to the completion of a liquidity event. The grant date fair value of the phantom units granted prior to LLC Conversion was estimated using both an option pricing method and a probability weighted expected return method. As of December 31, 2016 , the Company had $29,218 of unrecognized stock based compensation expense related to phantom units which will be recognized over a weighted-average period of 2.0 years . Of that amount, $25,875 of unrecognized expense is related to employee grants with a weighted-average period of 2.0 years and $3,343 of unrecognized expense is related to non-employee grants with a weighted-average period of 2.1 years . During the year ended December 31, 2016 , the Company issued 1,074,949 shares of common stock to participants of the Phantom Unit Plan based in the United States, after withholding approximately 546,728 shares to satisfy tax withholding obligations. The Company made a cash payment of $5,838 to cover employee withholding taxes upon the settlement of these vested phantom units. During the year ended December 31, 2016 the Company also paid $237 to cash-settle 16,940 vested phantom units held by participants of the Phantom Unit Plan based outside of the United States, and fractional shares remaining of vested units held by participants based in the United States. As described in Note 2, the Company early adopted ASU 2016-06 Improvements to Employee Share-Based Payment Accounting related to stock based compensation. The new standard simplifies the accounting for employee share-based payment transactions, including the accounting for forfeitures. The adoption of this standard had no material effect to the Company's Consolidated and Combined Financial Statements. 2016 Equity Incentive Plan In May and June of 2016, the Company’s Board of Directors adopted and the Company’s stockholders approved the 2016 Equity Incentive Plan (“the 2016 Plan”) in connection with the Company’s IPO. The 2016 Plan provides for the grant of incentive stock options, non-statutory stock options, restricted stock, restricted stock units, stock appreciation rights, performance units and performance shares to employees, directors and consultants. A total of 6,000,000 shares of common stock were reserved for issuance pursuant to the 2016 Plan. Restricted Stock The Company issued 10,462 shares of restricted stock under the 2016 Plan during the year ended December 31, 2016 in connection with the conversion of the Series C units, of which 3,486 were vested and converted into unrestricted common stock during 2016, and as of December 31, 2016 there were 6,976 shares of restricted stock. Total stock-based compensation expense of $266 is expected to be recognized on a straight-line basis over approximately the next 1.8 years for the unvested restricted stock outstanding as of December 31, 2016 . The unrecognized stock compensation relates to nonemployees and the awards are being accounted for pursuant to ASC 505-50. Stock compensation expense for the Series C units/restricted stock issued to the nonemployees is calculated based on the fair value of the award on each balance sheet date and the attribution of that cost is being recognized ratably over the vesting period. Stock Options During the year ended December 31, 2016 the Company issued 500,000 stock options under the 2016 equity incentive plan to Mark Burnett, who is a non-employee member of the Company’s Board of Directors, with exercise price of $14.00 . The award is being accounted for pursuant to ASC 505-50. Stock compensation expense issued to the nonemployees is calculated based on the fair value of the award on each balance sheet date and the attribution of that cost is being recognized ratably over the vesting period. The Company has utilized the Black-Scholes option-pricing model to determine the fair value of the stock options. A summary of the Company’s stock options information as of December 31, 2016 is presented as follows: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Weighted Average grant date fair value Intrinsic Value Outstanding 500,000 $14.00 9.9 $11.98 $— Vested and Expected to Vest — — — — — Exercisable — — — — — The aggregate intrinsic value of the stock options is calculated as the maximum between the difference between the exercise price of a stock option and the quoted price of the Company’s common stock and zero at December 31, 2016 . Accordingly, the aggregate intrinsic value excludes stock options that have exercise prices in excess of the quoted price of the Company’s common stock at December 31, 2016 . The fair value of options at the date of grant, and the weighted-average assumptions utilized to determine such values for the year ended December 31, 2016 are indicated in the following table: Amounts Risk-free interest rates 1.56 % Expected dividend yield — % Expected life 3.4 yrs Expected volatility 40.0 % As of December 31, 2016 , the Company had $902 of unrecognized stock based compensation expense related to the stock options. This cost is expected to be recognized over a weighted-average period of 9.9 years. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Income (Loss) Per Share The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted net income (loss) per share of common stock and redeemable common stock for the years ended December 31, 2016 , 2015 and 2014 : Year ended December 31, 2016 2015 2014 Common Stock Redeemable Common Stock Common Stock Redeemable Common Stock Common Stock Income (loss) per share numerator: Net loss attributed to NantHealth $ (184,102 ) $ — $ (72,011 ) $ — $ (84,425 ) Accretion to redemption value of series F/redeemable common stock (4,958 ) 4,958 (16,042 ) 16,042 — Net income (loss) for basic/diluted net income (loss) per share $ (189,060 ) $ 4,958 $ (88,053 ) $ 16,042 $ (84,425 ) Income (loss) per share denominator: Weighted-average shares for basic net loss per share 111,600,650 5,005,855 88,970,842 10,714,285 74,505,127 Effect of dilutive securities — — — — — Weighted-average shares for dilutive net income (loss) per share 111,600,650 5,005,855 88,970,842 10,714,285 74,505,127 Basic and diluted net income (loss) per share $ (1.69 ) $ 0.99 $ (0.99 ) $ 1.50 $ (1.13 ) The net income (loss) per share and weighted-average shares outstanding have been computed to give effect to the LLC Conversion (See Note 18) that occurred June 1, 2016 prior to the Company’s initial public offering. In conjunction with the LLC Conversion, (a) all of the Company’s outstanding units automatically converted into shares of common stock, based on the relative rights of the Company's pre-IPO equityholders as set forth in the limited liability company agreement and (b) the Company adopted and filed a certificate of incorporation with the Secretary of State of the state of Delaware and adopted bylaws. The Company filed an amended certificate of incorporation to effect a 1 -for- 5.5 reverse stock split of its common stock on June 1, 2016. As of December 31, 2015, the Company determined that the redemption of the Series F units was probable due to the uncertainty of completing a qualified initial public offering and, as such, accrued interest as a reduction to members’ equity. Prior to December 31, 2015, the Company had concluded that redemption was not probable and had not adjusted the carrying value of such units to redemption value. As of June 1, 2016 as part of the LLC Conversion, the Series F units converted to shares of redeemable common stock. The Put Right on redeemable common stock expired unexercised on June 20, 2016, and as of that date, the shares of common stock owned by KIO are no longer redeemable and are included in common shares (See Note 16). The following number of potential common shares at the end of each period were excluded from the calculation of diluted net loss per share attributable to common stockholders because their effect would have been anti-dilutive for the periods presented: Year Ended December 31, 2016 2015 2014 Unvested restricted stock 6,976 10,462 13,948 Unvested phantom units 4,322,081 3,722,914 — Stock options 500,000 — — Convertible notes 8,815,655 — — |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions NantWorks Shared Services Agreement In October 2012, the Company entered into a shared services agreement with NantWorks that provides for ongoing services from NantWorks in areas such as public relations, information technology and cloud services, human resources and administration management, finance and risk management, environmental health and safety, sales and marketing services, facilities, procurement and travel, and corporate development and strategy (the "Shared Services Agreement"). The Company was billed quarterly for such services at cost, without mark-up or profit for NantWorks, but including reasonable allocations of employee benefits, facilities and other direct or fairly allocated indirect costs that relate to the associates providing the services. The Company incurred $8,879 , $10,320 and $9,853 of expenses during the years ended December 31, 2016 , 2015 and 2014 , respectively, related to selling, general and administrative services provided to the Company by NantWorks and affiliates, net of services provided to NantWorks and affiliates. Additionally, the Company incurred $414 , $1,324 and $1,530 of expenses during the years ended December 31, 2016 , 2015 and 2014 , respectively, related to research and development services provided by NantWorks and its subsidiaries. Related Party Receivables and Payables As of December 31, 2016 and 2015 , the Company had related party receivables, net of payables of $2,870 and $2,545 , respectively. The related party receivables, net as of December 31, 2016 and 2015 primarily consisted of a receivable from Ziosoft KK of $2,126 and $2,150 , respectively, which was related to the sale of Qi Imaging. As of December 31, 2016 and 2015 the Company had related party payables, net of receivables of $8,082 and $10,166 , respectively. The related party payables, net of receivables balances primarily relate to amounts owed to NantWorks pursuant to the Shared Services Agreement and amounts owed to NantOmics under the Second Amended Reseller Agreement (defined below). The balance of the related party receivables and payables represent amounts paid by affiliates on behalf of the Company or vice versa. Amended Reseller Agreement On June 19, 2015, the Company entered into a five and a half year exclusive Reseller Agreement with NantOmics for sequencing and bioinformatics services (the "Original Reseller Agreement"). NantOmics is a majority owned subsidiary of NantWorks and is controlled by the Company's Chairman and CEO. On May 9, 2016, the Company and NantOmics executed an Amended and Restated Reseller Agreement (the “Amended Reseller Agreement”), pursuant to which the Company received the worldwide, exclusive right to resell NantOmics’ quantitative proteomic analysis services, as well as related consulting and other professional services, to institutional customers (including insurers and self-insured healthcare providers) throughout the world. The Company retained its existing rights to resell NantOmics’ genomic sequencing and bioinformatics services. Under the Amended Reseller Agreement, the Company is responsible for various aspects of delivering its sequencing and molecular analysis solutions, including patient engagement and communications with providers such as providing interpretations of the reports delivered to the physicians and resolving any disputes, ensuring customer satisfaction, and managing billing and collections. On September 20, 2016, the Company and NantOmics further amended the Reseller Agreement (the "Second Amended Reseller Agreement"). The Second Amended Reseller Agreement permits the Company to use vendors other than NantOmics to provide any or all of the services that are currently being provided by NantOmics and clarifies that the Company is responsible for order fulfillment and branding. The Second Amended Reseller Agreement grants to the Company the right to renew the agreement (with exclusivity) for up to three renewal terms, each lasting three years , if the Company achieves projected volume thresholds, as follows: (i) the first renewal option can be exercised if the Company completes at least 300 tests between June 19, 2015 and June 30, 2020; (ii) the second renewal option can be exercised if the Company completes at least 570 tests between July 1, 2020 and June 30, 2023; and (iii) the third renewal option can be exercised if the Company completes at least 760 tests between July 1, 2023 and June 30, 2026. If the Company does not meet the applicable volume threshold during the initial term or the first or second exclusive renewal terms, the Company can renew for a single additional three year term, but only on a non-exclusive basis. The Company agreed to pay NantOmics non-cancellable annual minimum fees of $2,000 per year for each of the calendar years from 2016 through 2020 and, subject to the Company exercising at least one of its renewal options described above, the Company is required to pay annual minimum fees to NantOmics of at least $25,000 per year for each of the calendar years from 2021 through 2023 and $50,000 per year for each of the calendar years from 2024 through 2029. As of December 31, 2016 and 2015 , the Company had $1,950 and $3,111 , respectively, of outstanding related party payables under the Second Amended Reseller Agreement. Master Services and License Agreement with the Chan Soon-Shiong Medical Center at Windber On December 29, 2016, the Company entered into a master services and license agreement with the Chan Soon-Shiong Medical Center at Windber (“CSSMCW”) whereby the Company will provide CSSMCW with access to certain of its hosted, software-as-a-service solutions and associated products and services. The initial order form under the agreement has a service period of three years and may be terminated for cause by either party in the case of material breach by the other party. Upon expiration of the initial term, the agreement automatically renews for successive one-year periods, unless either party provides the other party with at least 120 days’ prior written notice of its intent not to renew. Amounts invoiced to CSSMCW by the Company are payable within 30 days of receipt. No amounts have been recognized under this agreement during the year ended December 31, 2016. Cambridge Purchase Agreement On December 15, 2016, the Company entered into a purchase agreement (the “Cambridge Purchase Agreement”) with Cambridge Equities, L.P., an entity affiliated with the Company's Chairman and CEO Dr. Patrick Soon-Shiong (“Cambridge”), to issue and sell $10,000 in aggregate principal amount of the Convertible Notes in a private placement pursuant to an exemption from the registration requirements of the Securities Act afforded by Section 4(a)(2) of the Securities Act. The Cambridge Purchase Agreement includes customary representations, warranties and covenants by the Company and customary closing conditions (See Note 12). The accrued and unpaid interest on the convertible notes was $15 at December 31, 2016 , as part of current related party liabilities on the Consolidated and Combined Balance Sheet. Related Party Promissory Notes On January 4, 2016, the Company executed a $112,666 demand promissory note in favor of NantCapital to fund the acquisition of NaviNet. The note bears interest at a per annum rate of 5.0% , compounded annually and computed on the basis of the actual number of days elapsed and a year of 365 or 366 days, as the case may be. The unpaid principal and any accrued and unpaid interest on the note was originally due and payable on demand in either (i) cash, (ii) shares of the Company's common stock based on per share price of $18.6126 , (iii) Series A-2 units of NantOmics based on a per unit price of $1.484 to the extent such equity is owned by the Company or (iv) any combination of the foregoing, all at the option of NantCapital. Subject to the preceding sentence, the Company may prepay the outstanding amount at any time, either in whole or in part, without premium or penalty and without the prior consent of NantCapital. On May 9, 2016, the promissory note with NantCapital was amended to provide that all outstanding principal and accrued interest is due and payable on June 30, 2021, and not on demand. On December 15, 2016, in connection with the offering of the Convertible Notes, the Company entered into a Second Amended and Restated Promissory Note which amends and restates the Amended and Restated Promissory Note, dated May 9, 2016, between the Company and NantCapital, to, among other things, extend the maturity date of the Promissory Note to June 30, 2022 and to subordinate the Promissory Note in right of payment to the Convertible Notes (See Note 12 ). No other terms of the promissory note were changed. As of December 31, 2016 , the total principal and interest outstanding on the note amounted to $118,253 . The accrued and unpaid interest on the note was $5,587 at December 31, 2016 , as part of non current related party liabilities on the Consolidated and Combined Balance Sheet. The Company can request additional advances subject to NantCapital approval. The NantCapital Note bears interest at a per annum rate of 5.0% compounded annually and computed on the basis of the actual number of days in the year. NantCapital has the option, but not the obligation, to require us to repay any such amount in cash, Series A-2 units of NantOmics (based on a per unit price of $1.484 ) held by us, shares of the Company's common stock based on a per share price of $18.6126 (if such equity exists at the time of repayment), or any combination of the foregoing at the sole discretion of NantCapital. On January 22, 2016, the Company executed a demand promissory note in favor of NantOmics. The principal amount of the initial advance totaled $20,000 . On March 8, 2016, NantOmics made a second advance to the Company for $20,000 . The note bears interest at a per annum rate is 5.0% and is compounded annually. In May and June of 2016, the Company executed amendments to the demand promissory note with NantOmics, which provide that all unpaid principal of each advance owed to NantOmics and any accrued and unpaid interest would convert automatically into shares of the Company’s common stock after pricing of the Company’s IPO and immediately after conversion of the Company from a limited liability company to a corporation. On June 1, 2016, approximately $40,590 of principal and accrued interest under the promissory note with NantOmics was converted into 2,899,297 shares of the Company’s common stock in connection with the IPO. The Company can request additional advances subject to NantOmics approval, and as of December 31, 2016 , there was no outstanding balance on the promissory note. Investment in NantPharma and Redemption Agreement O n October 31, 2013, the Company entered into an exchange agreement, or the Exchange Agreement, with Blackstone Healthcare Partners II (AIV) L.L.C., or Blackstone, BCP NantPharma, L.P., NantBioScience, Inc., Blackstone Management Partners L.L.C., NantPharma and NantWorks. Pursuant to the Exchange Agreement, the Company purchased a portion of Blackstone’s minority equity interest in NantPharma in exchange for 3,572,031 of the Company's Series A units. In May 2014, the Company entered into a redemption agreement, or the Redemption Agreement, with NantPharma whereby the Company sold its entire equity interest in NantPharma in exchange for a cash payment of $10,000 , which was the approximate value of the Series A units issued to Blackstone. NantPharma currently is a wholly-owned subsidiary of NantWorks. For the year ended December 31, 2014, the Company recognized $1,525 income related to this investment. These amounts represented the Company's pro rata share of NantPharma’s earnings and losses during the period. |
Employee Retirement Plan
Employee Retirement Plan | 12 Months Ended |
Dec. 31, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Employee Retirement Plan | Employee Retirement Plan The Company has various employee retirement plans that it accounted for during the years ended December 31, 2016 , 2015 and 2014 . NantHealth 401(k) Plan The Company has a qualified defined contribution plan (the “NantHealth 401(k) Plan”) under Section 401(k) of the Internal Revenue Code covering eligible associates, including associates at certain of its subsidiaries. Associate contributions to the NantHealth 401(k) Plan are voluntary. The Company contributes a 100% match up to 3.0% of the participant’s eligible annual compensation, which contribution fully vests after three years of service. Participants’ contributions are limited to their annual tax deferred contribution limit as allowed by the Internal Revenue Service. For the years ended December 31, 2016 , 2015 and 2014 , the Company’s total matching contributions to the NantHealth 401(k) Plan were $2,160 , $1,079 and $551 , respectively. Old iSirona 401(k) Plan Prior to 2014, the Company had additional qualified defined contribution plan (the “Old iSirona 401(k) Plan”) for selected full time associates effective on their first day of employment. The Old iSirona 401(k) Plan was similar to the NantHealth 401(k) Plan with the exception that the Company contributed a 100% match up to 3.0% of the participant’s eligible annual compensation and up to 50.0% of the next 2.0% of their annual earnings, which vest immediately. For the year ended December 31, 2014, the Company's total matching contributions to the Old iSirona 401(k) Plan was $345 . In January 2014, the Company retired the Old iSirona 401(k) Plan and replaced it with the NantHealth 401(k) Plan. Old eviti 401(k) Plan The Company also had a Simple Individual Retirement Account plan that covers associates that have elected to participate in the plan who have at least six months of service ("Old eviti 401(k) Plan"). Associates who have not earned $5 or more in any preceding two year period, or who were not expected to earn at least that much in the current year, were not eligible to participate. The Company matches the associate’s contributions up to 3.0% of the associate’s wages for those associates who were contributing to the plan via a salary reduction, or a maximum of the associate’s contributions of $12 if the associate was under 50 years of age or $15 if over 50 years of age. The Company's contribution for the year ended December 31, 2014 was $220 . In January 2015, the Company retired the Old eviti 401(k) Plan and replaced it with the NantHealth 401(k) Plan. |
Selected Quarterly Financial In
Selected Quarterly Financial Information (Unaudited) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Quarterly Financial Information (Unaudited) | Selected Quarterly Financial Information (Unaudited) The following tables show a summary of the Company’s quarterly financial information for each of the four quarters of the years ended December 31, 2016 and 2015 (Unaudited): Year Ended December 31, 2016 Fourth Quarter Third Quarter Second Quarter First Quarter Net revenue $ 24,082 $ 25,357 $ 31,490 $ 19,451 Gross profit 4,262 8,121 9,250 6,413 Loss from operations (31,636 ) (32,263 ) (64,133 ) (33,469 ) Net loss (59,951 ) (36,874 ) (54,132 ) (33,145 ) Net income (loss) per share: Basic and diluted - common stock (0.49 ) (0.30 ) (0.54 ) (0.36 ) Basic and diluted - redeemable common stock N/A N/A 0.25 N/A Year Ended December 31, 2015 Fourth Quarter Third Quarter Second Quarter First Quarter Net revenue $ 20,405 $ 14,405 $ 11,752 $ 11,742 Gross profit 9,552 2,314 5,453 6,176 Loss from operations (15,001 ) (23,620 ) (17,343 ) (14,939 ) Net loss (17,852 ) (22,958 ) (17,236 ) (13,965 ) Net income (loss) per share: Basic and diluted - common stock (0.35 ) (0.24 ) (0.21 ) (0.17 ) Basic and diluted - redeemable common stock 1.50 N/A N/A N/A |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Securities Litigation In March 2017, a number of putative class action securities complaints were filed in U.S. District Court for the Central District of California, naming as defendants the Company and certain of the Company's executive officers and directors. The pending complaints are captioned Deora v. NantHealth, Inc., 2:17-cv-01825, Di Rienzo v. NantHealth, Inc., 2:17-cv-01912, and Shafik v. NantHealth, Inc., 2:17-cv-01940. Some of the complaints also name as defendants investment banks who were underwriters in the Company's initial public offering. The complaints generally allege that defendants violated the federal securities laws by making material misstatements and omissions concerning NantHealth’s business, operations, and results. In particular, the complaints refer to an article in alleging that defendants misrepresented NantHealth’s business with the University of Utah and donations to the university by non-profit entities associated with our founder Dr. Soon-Shiong. The complaints seek unspecified damages and other relief on behalf of putative classes of persons who purchased or acquired NantHealth securities in the IPO or on the open market from the time of the initial public offering through early March 2017. The Company believes that the claims lack merit and intend to vigorously defend the litigation. The monetary and other impact of this action may remain unknown for substantial periods of time. The cost to defend, settle or otherwise resolve this matter may be significant and divert management's attention. The Company cannot assure you that it will prevail in this lawsuit. If the Company is ultimately unsuccessful in this matter, it could be required to pay substantial amounts which might materially adversely affect the Company's business, operating results and financial condition. The Company evaluated subsequent events after the balance sheet date of December 31, 2016 through the date of the filing of this report, and determined that with the exception of the subsequent securities litigation described above, there were no other reportable subsequent events. |
Summary of Significant Accoun34
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the Consolidated and Combined Financial Statements and accompanying notes. Actual results may differ from those estimates. The estimates and assumptions used in the accompanying Consolidated and Combined Financial Statements are based upon management’s evaluation of the relevant facts and circumstances at the balance sheet date. On an ongoing basis, the Company evaluates its estimates, including those related to revenue recognition, accounts receivable allowance, inventory provisions, useful lives of long-lived assets and intangible assets, income taxes, stock based compensation, impairment of long-lived assets and intangible assets and the fair value of its investments and derivatives liability. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which can affect the reported amounts of assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. |
Variable Interest Entities | Variable Interest Entities The Company evaluates its ownership interests, contractual rights and other interests in entities to determine if the entities are variable interest entities (“VIEs”), if it has a variable interest in those entities and the nature and extent of those interests. These evaluations are highly complex and involve judgment, the use of estimates and assumptions based on available historical information. In order for the Company to be the primary beneficiary of a VIE, it must have both (1) the power to direct the activities of a VIE that most significantly affect the VIE’s economic performance and (2) the obligation to absorb losses or the right to receive benefits that, in either case, could potentially be significant to the VIE. The Company consolidates entities of which it is the primary beneficiary. The Company determines whether it is the primary beneficiary of a VIE upon its initial involvement with the VIE and reassesses whether it is the primary beneficiary on an ongoing basis. This determination is based upon an analysis of the design of the VIE, including the VIE’s structure and activities, the power to make significant economic decisions held by the Company and by other parties, and the variable interests owned by the Company and other parties. |
Non-controlling Interests | Non-Controlling Interests Non-controlling interests are classified as a separate component of equity in the Consolidated and Combined Balance Sheets and Consolidated and Combined Statements of Changes in Members’ Equity / Stockholders' Equity. Additionally, net loss attributable to non-controlling interests is reflected separately from consolidated and combined net loss in the Consolidated and Combined Statements of Operations, Comprehensive Loss and Changes in Members’ Equity / Stockholders' Equity. The Company uses the hypothetical liquidation at book value (“HLBV”) method to attribute certain non-wholly owned subsidiaries’ income or loss to the non-controlling interests when such income or loss is not allocated to the equity holders based on pro rata ownership percentage. This allocation methodology best represents the economics of the non-controlling interest holders’ share of income or loss. HLBV uses a balance sheet approach, which measures the non-controlling interests’ share of income or loss by calculating the change in the amount of net assets the investors are legally able to claim based on a hypothetical liquidation of the entity at the beginning and end of a reporting period. |
Revenue Recognition | Revenue Recognition Revenue represents the consideration received or receivable from clients for solutions and services provided by the Company. The Company’s revenue is generated from the following sources: • Software and hardware - Software and hardware revenue is generated from the sale of the Company’s software, on either a perpetual or term license basis, and the sale of hardware. The software is installed on the client’s site or the client’s designated vendor’s site and is not hosted by the Company or by a vendor contracted by the Company. The Company also sells third-party software and hardware to its clients. • Software-as-a-service (“SaaS”) - SaaS revenue is generated from clients’ access to and usage of the Company’s hosted software solutions on a subscription basis for a specified contract term, which is usually monthly. In SaaS arrangements, the client cannot take possession of the software during the term of the contract and generally has the right to access and use the software and receive any software upgrades published during the subscription period. • Maintenance - Maintenance revenue includes ongoing post contract client support (“PCS”) or maintenance during the paid PCS term. Additionally, PCS includes ongoing development of software updates and upgrades provided to the client on a when and if available basis. • Sequencing and molecular analysis - Sequencing and molecular analysis revenue is generated by the process of performing sequencing and analysis of whole genome DNA, RNA and proteomic results under the Company's reseller agreement with NantOmics, LLC ("NantOmics") (See Note 21 ). • Other services - Other services includes revenue from professional services provided that are generally complementary to the software and may or may not be required for the software to function as desired by the client. The services are generally provided in the form of training and implementation services during the software license period and do not include PCS. Other services revenue also includes the sale of nursing and therapy services provided to patients in a home care setting and any other services not included in the preceding revenue sources. Revenue is recognized when persuasive evidence of an arrangement exists, services or products have been provided to the client, fees are fixed or determinable, and collectability is reasonably assured. While most of the Company’s arrangements include short-term payment terms, the Company on occasion provides payment terms to clients in excess of one year from the date of contract signing. The Company does not recognize revenue for arrangements containing these extended payment terms until such payments become due. Certain of the Company’s customer arrangements allow for termination for convenience with advanced notice. Such termination rights do not allow for refunds other than prepaid PCS or other services. These provisions do not affect when the Company commences revenue recognition. The Company also has certain arrangements which allow for termination and refunds of fees in the event that software acceptance by the customer has not occurred. In these instances, the Company will defer all revenue until software acceptance has occurred. The Company's clinical sequencing and molecular analysis revenue is primarily generated from payments received from commercial third-party payors, hospitals and other provider networks and patients. The Company reports revenue from arrangements with these customers on a gross basis in accordance with Financial Accounting Standards Board (“ FASB") Accounting Standards Update ("ASC") No. 605-45, Principal Agent Considerations . The Company recognizes revenue from these arrangements when all revenue recognition criteria have been met or on a cash basis when it cannot conclude that the fees are fixed or determinable and collectability is reasonably assured. The Company uses judgment in its assessment of whether the fees are fixed or determinable and whether collectability is reasonably assured in determining when to recognize revenue in the future as it continues to gain payment experience with its customers. Accordingly, the Company expects to recognize revenue on a cash basis when it cannot conclude that the fees from a particular customer are fixed or determinable and collectability is reasonably assured until it has a sufficient history to reliably estimate payment patterns from such customer. The Company engages in various multiple-element arrangements, which may generate revenue across any of the sources noted above. For multiple-element software arrangements that involve the sale of the Company’s proprietary software, PCS and other software-related services, vendor-specific objective evidence (“VSOE”) of fair value is required to allocate and recognize revenue for each element. VSOE of fair value is determined based on the price charged in which each deliverable is sold separately. The Company has established VSOE for PCS on certain of its software solutions using the Stated Renewal Method. In this instance, the Company has determined that its stated renewals are substantive and appropriate for use in the Stated Renewal Method. The Company has not yet established VSOE of fair value for any element other than PCS for a portion of its arrangements. In situations where VSOE of fair value exists for PCS but not a delivered element (typically the software license and services elements), the residual method is used to allocate revenue to the undelivered element equal to its VSOE value with the remainder allocated to the delivered elements. In situations in which VSOE of fair value does not exist for all of the undelivered software-related elements, revenue is deferred until only one undelivered element remains (typically the PCS element) and then recognized following the pattern of delivery of the final undelivered element. The Company’s multiple element arrangements typically provide for renewal of PCS terms upon expiration of the original term. The amounts of these PCS renewals are recognized as revenue ratably over the specified PCS renewal period. For non-software arrangements that include multiple-elements, primarily consisting of the Company’s SaaS agreements and research sequencing and molecular analysis agreements, revenue recognition involves the identification of separate units of accounting after consideration of combining and/or segmenting contracts and allocation of the arrangement consideration to the units of accounting on the basis of their relative selling price. The selling price used for each deliverable is based on VSOE of fair value, if available, third party evidence (“TPE”) of fair value if VSOE is not available, or the Company’s best estimate of selling price (“BESP”) if neither VSOE nor TPE is available. In determining the units of accounting for these arrangements, the Company evaluates whether each deliverable has stand-alone value as defined in the FASB’s guidance. The Company’s SaaS arrangements are treated as a single unit of accounting as the professional services do not have standalone value. As a result, the Company recognizes initial system implementation and deployment fees ratably over a period of time from when the system implementation or deployment services are completed and accepted by the customer over the longer of the life of the agreement or the estimated customer life. If an arrangement to deliver software requires significant production, modification or customization of the licensed software, the Company accounts for the arrangement as a construction-type contract. The Company currently recognizes revenue for these arrangements using the completed-contract method as it does not currently have sufficient information to reliably estimate the percentage of completion for these projects. The Company considers these arrangements to be substantially complete upon the clients’ acceptance of the software and related professional services and consistently applies this policy to all contract accounting arrangements. Transaction processing fees are recognized on a monthly basis based on the number of transactions processed and the fee per transaction. Revenue derived from reseller arrangements is recognized when the resellers, in turn, sell the software solution to their clients and installation of the software solution has occurred, provided all other revenue recognition criteria are met. This is commonly referred to as the sell-through method and the Company defers recognition until there is a sell-through by the reseller to an actual end user clients and acceptance by the end user has occurred. |
Cost of Revenue | Cost of Revenue Cost of revenue includes associate salaries, bonuses and benefits, stock based compensation, consultant costs, direct reimbursable travel expenses, depreciation related to software developed for internal use and other direct engagement costs associated with the design, development, sale and installation of systems, including system support and maintenance services for clients. System support includes ongoing client assistance for software updates and upgrades, installation, training and functionality. All service costs except deferred implementation costs are expensed when incurred. Amortization of deferred implementation costs are also included in cost of revenue. Cost of revenue associated with each of the Company’s revenue sources consists of the following types of costs: • Software and hardware - Software and hardware cost of revenue includes third-party software and hardware costs directly associated with solutions, including purchasing and receiving costs. • Software-as-a-service - SaaS cost of revenue includes personnel-related costs, amortization of deferred implementation costs and other direct costs associated with the delivery and hosting of NantOS and NantOS apps, the cancer-decision support solution, and NaviNet on a subscription basis. • Maintenance - Maintenance cost of revenue includes personnel-related costs and other direct costs associated with the ongoing support or maintenance provided to the Company’s clients. • Sequencing and molecular analysis - Sequencing and molecular analysis cost of revenue includes (a) personnel-related costs associated with these services and (b) amounts due to NantOmics under the reseller agreement (See Note 21 ) for the sequencing and analysis of whole genome, DNA, RNA and proteomic results. • Other services - Other services cost of revenue includes personnel-related, amortization of deferred implementation costs and other direct costs associated with the Company’s software training and implementation services provided to our clients as well as direct expenses relating to the Company’s nursing and therapy services provided to patients in a home care setting. In addition to direct labor costs, cost of revenue also includes hardware costs directly related to bringing manufactured products to their final selling destination. It includes purchasing and receiving costs and direct and indirect costs to manufacture products, including direct materials, direct labor, and direct overhead expenses necessary to acquire and convert purchased materials and supplies into finished goods. |
Selling, General and Administrative costs | Selling, General and Administrative costs Selling, general and administrative expense consists primarily of shared service fees from NantWorks, personnel-related expenses for our sales and marketing, finance, legal, human resources, and administrative associates, stock based compensation, and advertising and marketing promotions of NantHealth solutions. It also includes trade show and event costs, sponsorship costs, point of purchase display expenses and related amortization as well as legal costs, consulting and professional fees, insurance and other corporate and administrative costs. Advertising costs are expensed as incurred. |
Research and Development Expenses | Research and Development Expenses Research and development (“R&D”) costs incurred to establish the technological feasibility of software to be sold are expensed as incurred. These expenses include the costs of the Company’s proprietary R&D efforts, as well as costs incurred in connection with certain licensing arrangements. Development costs, consisting primarily of employee salaries and benefits (including stock based compensation), incurred in the research and development of new software products and enhancements to existing software products are expensed as incurred until technological feasibility has been established. After technological feasibility is established, any software development costs are capitalized. Costs incurred to acquire or create a computer software product are expensed when incurred as research and development until technological feasibility has been established for the product, at which point such costs are capitalized. Technological feasibility is normally established upon completion of a detailed program design or, in its absence, a working model of the software product. Capitalization of computer software costs to be sold to customers ceases when the product is available for general release to customers. As of December 31, 2016 and 2015 , the Company has not capitalized software costs to be sold to customers as no significant costs have been incurred in developing software products and technological feasibility has not been established for new software products and enhancements to existing software. |
Stock Based Compensation | Stock Based Compensation The Company accounts for stock based compensation arrangements granted to employees in accordance with ASC 718, " Compensation: Stock Compensation", by measuring the grant date fair value of the award and recognizing the resulting expense over the period during which the employee is required to perform service in exchange for the award. The Company accounts for stock based compensation arrangements issued to non-employees using the fair value approach prescribed by ASC 505-50, “ Equity-Based Payments to Non-Employees". The value of non-employee stock based compensation is re-measured at the end of each reporting period until the award vests and is recognized as stock based compensation expense over the period during which the non-employee provides the services. Stock based compensation expense for both employee and non-employee awards is recognized on a straight-line basis over the appropriate service period for awards that are only subject to service conditions and is recognized using the accelerated attribution method for awards that are subject to performance conditions. Stock based compensation expense is only recognized for awards subject to performance conditions if it is probable that the performance condition will be achieved. The Company early adopted FASB ASU 2016-09, “ Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting ” (“ASU 2016-09”) related to stock based compensation, beginning July 1, 2016, simplifying the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory withholding requirements, as well as the related classification in the statement of cash flows. All excess tax benefits and tax deficiencies are recognized as income tax benefit or expense in the income statement as discrete items in the reporting period in which they occur, and such tax benefits and tax deficiencies are not included in the estimate of an entity’s annual effective tax rate, applied on a prospective basis. The recognition of excess tax benefits is not deferred until the benefit is realized through a reduction to taxes payable. When the Company applies the treasury stock method, in calculating diluted earnings per share, excess tax benefits, if applicable, are excluded and deficiencies from the calculation of assumed proceeds since such amounts are recognized in the income statement. Excess tax benefits if applicable, are classified as operating activities in the same manner as other cash flows related to income taxes on the statement of cash flows. Per ASU 2016-09, an entity can make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest (current GAAP) or account for forfeitures when they occur. The Company has elected to account for forfeitures when they occur. Cash paid by the Company when directly withholding shares for tax withholding purposes should be classified as a financing activity in the Statement of Cash Flows (See Note 15 and Note 19). |
Change in Fair Value of Derivative Liability | Change in fair value of derivative liability The Company has classified the interest make-whole provision of its convertible notes and related party convertible note due June 2021 and issued in December 2016 as a derivative liability as part of other liabilities and related party liabilities, respectively, in the Consolidated and Combined Balance Sheets and is recorded at fair value. This derivative liability is subject to re-measurement at each balance sheet date, and the Company recognizes any change in fair value in the Company's Consolidated and Combined Statements of Operations as a change in fair value of the derivative liability. The change in the fair value of this derivative liability is primarily due primarily to the change in the value of the Company's common stock (See Note 13). |
Income Taxes | Income Taxes Prior to June 1, 2016, NantHealth was a limited liability company taxed as partnership. It also owned a number of subsidiaries, including single member limited liability companies taxed as disregarded entities and corporations. The income and losses of the entities classified as pass-through entities for tax purposes flowed directly through to the members of the partnership. Accordingly, no provision for U.S. federal and state income taxes was reflected in the Consolidated and Combined Financial Statements for the pass-through income or losses. The Company recorded a tax provision on its domestic and foreign corporate subsidiaries. |
Net Income (Loss) Per Share | Net Income (Loss) Per Share Basic net income (loss) per share is computed by dividing the net income (loss) by the weighted-average number of shares of common stock outstanding during the period. Diluted net income (loss) per share is computed by dividing the net income (loss) by the weighted-average number of shares of common stock outstanding during the period, adjusted to give effect to potentially dilutive securities. However, potentially dilutive securities are excluded from the computation of diluted net income (loss) per share to the extent that their effect is anti-dilutive. The Company applies treasury method in calculating weighted average dilutive umber of shares for its stock plans. The Company recorded in certain reporting periods an accretion to the carrying value of the Redeemable Series F units and a reduction to members’ equity carrying amount, when the Company deemed it probable that the Series F units would be redeemed. As a result, the net loss applicable to common stockholders reported in the calculation of earnings per share was increased, income for redeemable Series F was increased, and a two class method of net income (loss) per share was applied (See Note 16 and Note 20). |
Foreign Currency Translation | Foreign Currency Translation The Company has operations and holds assets in various foreign countries. The local currency is the functional currency for the Company’s subsidiaries in Canada, United Kingdom, Singapore and India. Assets and liabilities are translated at end-of-period exchange rates while revenues and expenses are translated at the average exchange rates in effect during the period. Equity is translated at historical rates and the resulting cumulative translation adjustments are included as a component of accumulated other comprehensive income until the translation adjustments are realized. |
Segment Reporting | Segment Reporting The chief operating decision maker for the Company is its Chief Executive Officer. The Chief Executive Officer reviews financial information presented on a Consolidated and Combined basis for purposes of allocating resources and evaluating financial performance. The Company has one business activity and there are no segment managers who are held accountable for operations, operating results, or plans for levels or components below the Consolidated and Combined unit level. Accordingly, management has determined that the Company operates in one reportable segment. |
Business Combinations | Business Combinations Business combinations are accounted for using the acquisition method of accounting. Under the acquisition method, assets acquired and liabilities assumed are recorded at their respective fair values as of the acquisition date. Any excess of the purchase price over the estimated fair values of the net assets acquired is recorded as goodwill. Management routinely monitors the factors impacting the acquired assets and liabilities. Transaction related costs are expensed as incurred. The operating results of the acquired business are reflected in the Company’s Consolidated and Combined Financial Statements as of the acquisition date. |
Fair Value of Financial Measurements | Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are classified and disclosed in one of the following three categories: • Level 1—Quoted prices for identical assets or liabilities in active markets; • Level 2—Quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active or are directly or indirectly observable; and • Level 3—Unobservable inputs that reflect estimates and assumptions. The carrying amounts reported in the balance sheet for cash and cash equivalents, accounts receivable, accounts payable, notes payable, deferred revenue and other current monetary assets and liabilities approximate fair value because of the immediate or short-term maturity of these financial instruments. In accordance with this guidance, the Company measures its cash equivalents and marketable securities at fair value. The Company’s cash equivalents and marketable securities are classified within Level 1. Cash equivalents and marketable securities are valued primarily using quoted market prices utilizing market observable inputs. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all unrestricted, highly liquid investments with an initial maturity of three months or less to be cash equivalents. These amounts are stated at cost, which approximates fair value. At December 31, 2016 and 2015 , cash equivalents were deposited in financial institutions and consisted of immediately available fund balances. Cash and cash equivalents are maintained at stable financial institutions, generally at amounts in excess of federally insured limits, which represents a concentration of credit risk. |
Marketable Securities | Marketable Securities The Company’s marketable securities consist of investments in mutual funds and are reported on the balance sheet at fair value based upon quoted market prices (See Note 13). Although the Company does not actively trade these investments, it classifies the marketable securities as trading securities. The cost of investments sold is determined on the specific identification method. Dividend and interest income are accrued as earned. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount, net of amounts related to PCS and other services that were billed but not yet delivered at each period end (See Note 4) and net of allowances for doubtful accounts. The allowance for doubtful accounts is based on management’s assessment of the collectability of accounts. The Company regularly reviews the adequacy of the allowance for doubtful accounts by considering the age of each outstanding invoice and the collection history of each client to determine whether a specific allowance is appropriate. Accounts receivable deemed uncollectible are charged against the allowance for doubtful accounts when identified. |
Inventories | Inventories Through December 31, 2015 inventories were stated at the lower of cost (first-in, first-out basis) or market. The Company early adopted FASB ASC 2015-11 Simplifying the Measurement of Inventory ("ASC 2015-11") , and starting in December 31, 2016 inventories were stated at the lower of cost and net realizable value. |
Property, Plant and Equipment, net | Property, Plant and Equipment, net Property, plant and equipment received in connection with business combinations are recorded at fair value. Property, plant and equipment acquired in the normal course of business are recorded at cost. Depreciation is computed on a straight line basis over the estimated useful lives of the related assets (See Note 7). Maintenance and repairs are charged to expense as incurred while expenditures for refurbishments and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized. The Company accounts for the costs of computer software obtained or developed for internal use in accordance with FASB ASC 350, " Intangibles — Goodwill and Other " ("ASC 350"). Computer software development costs are expensed as incurred, except for internal use software costs that qualify for capitalization as described below, and include employee related expenses, including salaries, benefits and stock-based compensation expenses; costs of computer hardware and software; and costs incurred in developing features and functionality. These capitalized costs are included in property and equipment on the Consolidated and Combined Balance Sheets. The Company expenses costs incurred in the preliminary project and post implementation stages of software development and capitalizes costs incurred in the application development stage and costs associated with significant enhancements to existing internal use software applications. Software costs are amortized using the straight-line method commencing when the software project is ready for its intended use. |
Deferred Implementation Costs | Deferred Implementation Costs The Company provides SaaS and information technology management services under long-term arrangements which require the Company to perform system implementation activities. In some cases, the arrangements either contain provisions requiring customer acceptance of the setup activities prior to commencement of the ongoing services arrangement or the system implementation services do not have separate value from the service revenue. Up-front fees billed during the setup phase for these arrangements are deferred and setup costs that are direct and incremental to the contract are capitalized. The costs deferred consist of employee compensation (including stock based compensation) and benefits for those employees directly involved with performing system implementation or deployment services, as well as other direct and incremental costs. The Company defers costs estimated to be realizable based on contracted implementation revenue and estimated margin from the service contract. The Company periodically reviews the deferred implementation contracts for recoverability. The costs are amortized to cost of revenue ratably over a period of time from when the system implementation or deployment services are completed and accepted to the end of the contract term or the expected customer life, whichever is longer. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets G oodwill acquired in a business combination and determined to have an indefinite useful life is not amortized but is tested for impairment annually as of October 1 or between annual tests when an impairment indicator exists. In the event there is a change in reporting units or segments, the Company will test for impairment at the reporting unit. A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and segment management regularly reviews the operating results of that component. As part of the annual impairment test, the Company may conduct an assessment of qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. In a qualitative assessment, the Company would considered the macroeconomic conditions, including any deterioration of general conditions, industry and market conditions, including any deterioration in the environment where the reporting unit operates, increased competition, changes in the products/services and regulator and political developments; cost of doing business; overall financial performance, including any declining cash flows and performance in relation to planned revenues and earnings in past periods; other relevant reporting unit specific facts, such as changes in management or key personnel or pending litigation, and events affecting the reporting unit, including changes in the carrying value of net assets. If an optional qualitative goodwill impairment assessment is not performed, the Company is required to determine the fair value of each reporting unit. If a reporting unit’s fair value is lower than its carrying value, the Company must determine the amount of implied goodwill that would be established if the reporting unit was hypothetically acquired on the impairment test date. If the carrying amount of a reporting unit’s goodwill exceeds the amount of implied goodwill, the Company would record an impairment loss equal to the excess (See Note 9). The determination of fair value of a reporting unit is based on a combination of a market approach that considers benchmark company market multiples and an income approach that uses discounted cash flows for each reporting unit utilizing Level 3 inputs. Under the income approach, the Company determines the fair value based on the present value of the most recent income projections for each reporting unit and calculates a terminal value utilizing a terminal growth rate. The significant assumptions under this approach include, among others: income projections, which are dependent on sales to new and existing clients, new solution introductions, client behavior, competitor pricing, operating expenses, the discount rate, and the terminal growth rate. The cash flows used to determine fair value are dependent on a number of significant management assumptions based on historical experience, expectations of future performance, and the expected economic environment. Estimates are subject to change given the inherent uncertainty in predicting future results. Additionally, the discount rate and the terminal growth rate are based on judgment of the rates that would be utilized by a hypothetical market participant. Accounting guidance requires that definite-lived intangible assets be amortized over their respective estimated useful lives and reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. Amortization of finite-lived intangible assets is provided over their estimated useful lives on a straight-line basis or the pattern in which economic benefits are consumed, if reliably determinable. If the estimates of the useful lives change, the Company amortizes the remaining book value over the remaining useful lives or, if an asset is deemed to be impaired, a write-down of the value of the asset to its fair value may be required at such time. The Company reviews its finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. |
Investments in Related Parties | Investment in Related Party Investment in and advances to related party in which the Company has a substantial ownership interest of approximately 20% to 50% , or for which the Company exercises significant influence but not control over policy decisions, are accounted for by the equity method. Investment in a limited liability company that is similar to a partnership is also accounted for under the equity method if more than minor influence over the operation of the investee exists (generally through more than 3 - 5% ownership). As part of that accounting, the Company recognizes gains and losses that arise from the issuance of stock by a related party that results in changes in the Company’s proportionate share of the dollar amount of the related party’s equity. Investment in related party is assessed for possible impairment when events indicate that the fair value of the investment may be below the Company’s carrying value. When such a condition is deemed to be other than temporary, the carrying value of the investment is written down to its fair value, and the amount of the write-down is included in net loss. In making the determination as to whether a decline is other than temporary, the Company considers such factors as the duration and extent of the decline, the investee’s financial performance, and the Company’s ability and intention to retain its investment for a period that will be sufficient to allow for any anticipated recovery in the investment’s market value. The new cost basis of investments in these equity investees is not changed for subsequent recoveries in fair value. The fair value of the related party equity method investment would be determined using the income approach. The income approach utilizes a discounted cash flow model incorporating management’s expectations for future revenue, operating expenses, and earnings before interest, taxes, depreciation and amortization, capital expenditures and an anticipated tax rate. The related cash flow forecasts are discounted using an estimated weighted-average cost of capital at the date of valuation. Differences between the Company’s carrying value of an equity investment and its underlying equity in the net assets of the related party are assigned to the extent practicable to specific assets and liabilities based on the Company’s analysis of the various factors giving rise to the difference. When appropriate, the Company’s share of the related party’s reported earnings is adjusted quarterly to reflect the difference between these allocated values and the related party’s historical book values. |
Deferred Revenue | Deferred Revenue The Company records deferred revenue when it receives cash from clients prior to meeting the applicable revenue recognition criteria. The Company uses judgment in determining the period over which the deliverables are recognized as revenue. As of December 31, 2016 and 2015 , current and non-current deferred revenue are comprised of deferrals for fees related to software licenses, SaaS arrangements, PCS services, non-PCS services and other revenue. Non-current deferred revenue as of December 31, 2016 is expected to be recognized on or over 12 month period following that day. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Revenue from Contracts with Customers The new FASB Topic 606 standards commencing with Accounting Standard Update ("ASU") No. 2014-09 ("Topic 606"), Revenue from Contracts with Customers replace existing revenue recognition rules including industry-specific guidance. Topic 606 outlines a five-step process for revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards, and also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenues and cash flows from contracts with customers. Major provisions include determining which goods and services are distinct and require separate accounting (performance obligations), how variable consideration (which may include change orders and claims) is recognized, whether revenue should be recognized at a point in time or over time and ensuring the time value of money is considered in the transaction price. Revenue is recognized in an amount that reflects the consideration which the entity expects to receive in exchange for goods or services. They become effective for annual reporting periods beginning after December 15, 2017, at which point we plan to adopt the standard. The FASB allows two adoption methods under Topic 606 standards. Under one method, a company will apply the rules to contracts in all reporting periods presented, subject to certain allowable exceptions. Under the other method, a company will apply the rules to all contracts existing as of January 1, 2018, recognizing in beginning retained earnings an adjustment for the cumulative effect of the change and providing additional disclosures comparing results to previous rules. In December 2016, the FASB issued ASU No. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers . The FASB issued 13 technical corrections and improvements to ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), including providing optional exemptions from the disclosure requirement for remaining performance obligations for specific situations in which an entity need not estimate variable consideration to recognize revenue. The amendments in this standard also expand the information that is required to be disclosed when an entity applies one of the optional exemptions. In May 2016, the FASB issued ASU No. 2016-12, " Revenue from Contracts with Customers (Topic 606)" . The amendments, which address transition, collectability, non-cash consideration and the presentation of sales and other similar taxes, do not change the core principles of ASU 2014-09, but rather address implementation issues and are intended to result in more consistent application. In April 2016, the FASB issued ASU No. 2016-10, " Identifying Performance Obligations and Licensing", which amends certain aspects of ASC 606, Revenue from Contracts with Customers. ASU No. 2016-10 amends step two of the new revenue standard’s five-step model to include guidance on immaterial promised goods or services, shipping and handling activities and identifying when promises represent performance obligations. ASU No. 2016-10 also provides guidance related to licensing such as, but not limited to, sales-based and usage-based royalties and renewals of license that provide a right to use intellectual property. The initial assessment of the impact of the new revenue standard on the current business processes, systems and controls is expected to be completed during fiscal 2017. Additionally, the Company is currently evaluating the potential impact that the implementation of this new revenue standard will have on the Company's Consolidated Financial Statements as well as selection of the method of adoption. The FASB has issued, and may issue in the future, interpretive guidance which may cause the evaluation to change. The Company currently does not expect to implement this new standard prior to the required effective date. Upon initial evaluation, the Company expects that the most significant impact will likely be to its software arrangements due to the requirement to estimate of selling price for deliverables. Under current revenue accounting guidance, if VSOE did not exist for license and implementation fees, the Company recognizes those revenues over the post contract support period. Also, the principal versus agent analysis under ASC 606 focuses on whether the entity controls each specified good or service in an arrangement and the company is currently evaluating whether the guidance will have an impact on how the Company reports its sequencing and molecular analysis revenue. Other accounting pronouncements In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): C larifying the Definition of a Business . This standard clarifies the definition of a business and provides a screen to determine if a set of inputs, processes and outputs is a business. The screen requires that when substantially all of the fair value of gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the assets acquired would not be a business. Under the new guidance, in order to be considered a business, an acquisition must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output. In addition, the standard narrows the definition of the term “output” so that it is consistent with how it is described in Topic 606 standards. This standard will be effective for annual periods beginning after December 15, 2017, including interim periods within that reporting period. The Company is currently evaluating the impact this guidance may have on its Consolidated and Combined Financial Statements. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash . This standard will require that companies include restricted cash and restricted cash equivalents in their cash and cash equivalent balances in the statement of cash flows. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This standard will be effective for annual periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption of this standard is permitted. The adoption of this standard update is not expected to have a material impact on the Company's Consolidated and Combined Financial Statements. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350) to simplify the accounting for goodwill impairment. This guidance, among other things, removes step 2 of the goodwill impairment test thus eliminating the need to determine the fair value of individual assets and liabilities of the reporting unit. Upon adoption of this ASU, goodwill impairment will be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. This may result in more or less impairment being recognized than under current guidance. This Update will become effective for the Corporation’s annual and interim goodwill impairment tests beginning in the first quarter of 2020. The adoption of this standard update is not expected to have a material impact on the Company's Consolidated and Combined Financial Statements. In August 2016, the FASB issued ASU No. 2016-15, " Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments. " This standard update was issued to address diversity in practice in how certain cash receipts and cash payments are presented and classified. The provisions of ASU 2016-15 will be effective for interim and annual periods beginning after December 15, 2017. Early adoption is permitted. The adoption of this standard update is not expected to have a material impact on the Company's Consolidated and Combined Financial Statements. In June 2016, the FASB issued ASU No. 2016-13, " Measurement of Credit Losses on Financial Instruments" (“ASU 2016-13”), which changes how companies measure credit losses on most financial instruments measured at amortized cost, such as loans, receivables and held-to-maturity debt securities. Rather than generally recognizing credit losses when it is probable that the loss has been incurred, the revised guidance requires companies to recognize an allowance for credit losses for the difference between the amortized cost basis of a financial instrument and the amount of amortized cost that the company expects to collect over the instrument's contractual life. ASU 2016-13 is effective for fiscal periods beginning after December 15, 2019 and must be adopted as a cumulative effect adjustment to retained earnings. Early adoption is permitted. The Company is evaluating the potential effects of the adoption of this guidance on the Company's Consolidated and Combined Financial Statements. In March 2016, the FASB issued ASU No. 2016-09, " Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting" . ASU 2016-09 changes certain aspects of the accounting for share-based payment awards, including: accounting and cash flow classification for excess tax benefits and deficiencies; income tax withholding obligations; forfeitures; and cash flow classification. ASU 2016-09 was effective for the Company in the first quarter of 2017, with early adoption permitted. As mentioned above, the Company early adopted this guidance effective July 1, 2016, see Note 15 and Note 19. In February 2016, the FASB issued ASU No. 2016-02, " Leases (Topic 842)" (“ASU 2016-02”). The update is aimed at making leasing activities more transparent and comparable, and requires substantially all leases be recognized by lessees on their balance sheet as a right-of-use asset and corresponding lease liability, including leases currently accounted for as operating leases. This guidance will become effective for interim and annual reporting periods beginning with the year ending December 31, 2019. Early adoption is permitted. The Company is currently evaluating the impact that the adoption of this guidance will have on its Consolidated and Combined Financial Statements and related disclosures. In January 2016, the FASB issued ASU No. 2016-01, " Financial Instruments Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities" (“ASU 2016-01”), which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments, including a provision that requires equity investments (except for investments accounted for under the equity method of accounting) to be measured at fair value, with changes in fair value recognized in current earnings. ASU 2016-01 is effective for the Company in the first quarter of 2018, with early adoption permitted. The Company is currently evaluating the effect that ASU 2016-01 will have on its Consolidated and Combined Financial Statements and related disclosures. In August 2014, the FASB issued Accounting Standards Update No. 2014-15, Going Concern (Subtopic 205-40) ("ASU 2014-15"). ASU 2014-15 requires management of all entities to evaluate whether there are conditions and events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the financial statements are issued (or available to be issued when applicable). The guidance is effective for annual periods ending after December 15, 2016 and for interim periods thereafter. The adoption of this guidance did not have an effect on the Company's Consolidated and Combined Financial Statements during the year ended December 31, 2016. Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the Securities and Exchange Commission ("SEC") did not have, or are not believed by management to have, a material impact on the Company's present or future Consolidated and Combined Financial Statements. |
Summary of Significant Accoun35
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedules of Concentration of Risk | The following table summarizes the number of customers that individually comprise greater than 10% of revenues and or 10% of accounts receivable, and their aggregate percentages of total revenues and total billed and unbilled accounts receivable: Period Significant Customers Percentage of Total Revenues Percentage of Total Accounts Receivable A B A B Year Ended December 31, 2016 2 10.6% 10.2% 7.9% 7.6% Year Ended December 31, 2015 1 14.7% —% —% —% No customers accounted for more than 10% of revenue for the year ended December 31, 2014 . |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, Total Purchase Consideration | The following table summarizes the total purchase consideration for the acquisition, including the effects of the final net working capital adjustment: Amounts Cash paid to Harris at closing $ 43,056 Cash paid to escrow account 7,500 Working capital released from escrow (2,494 ) Total consideration $ 48,062 The following table summarizes the total purchase consideration for the acquisition: Amounts Cash paid to 3BE at closing $ 74,823 Cash paid to option holders after closing 2,580 Cash paid to escrow account 6,126 Working capital settlement payment 455 Fair value of Series H units 52,500 Total consideration $ 136,484 The following table summarizes the total consideration for the acquisition, including interest-bearing liabilities assumed and the impacts of the settlement of preexisting relationships: Amounts Fair value of acquired 60.9% interest $ 16,619 Fair value of previously owned 39.1% investment 14,005 Debt repayment to NDO founder 2,335 Interest-bearing liabilities assumed 722 Settlement of preexisting relationships 6,393 Total consideration $ 40,074 |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The fair value of the identifiable assets acquired and liabilities assumed for the HCS business is shown in the table below: Amounts Accounts receivable, net $ 13,119 Other liabilities and assets, net (2,205 ) Deferred revenue (16,076 ) Trademarks 2,400 Developed technology 14,400 Customer relationships 8,900 Backlog 3,900 Goodwill 23,624 Total fair value of net assets acquired $ 48,062 The fair value of the identifiable assets acquired and liabilities assumed for the NDO acquisition is shown in the table below: Amounts Cash and cash equivalents $ 29 Non-cash net working capital, excluding deferred revenue (3,773 ) Property and Equipment and other non-current assets 332 Deferred revenue (7,352 ) Developed technology 23,400 Goodwill 27,438 Total fair value of net assets acquired $ 40,074 The total consideration was allocated to the net assets acquired based upon their estimated fair values : Amounts Cash and restricted cash $ 4,804 Accounts receivable, net 10,693 Property, plant and equipment 5,044 Other assets and liabilities, net 4,561 Accounts payable (4,585 ) Accrued and other current liabilities (3,674 ) Deferred revenue (2,603 ) Deferred tax liability (15,508 ) Assumed indebtedness (23,324 ) Trade names 3,000 Developed technology 32,000 Customer relationships 52,000 Goodwill 74,076 Total fair value of net assets acquired $ 136,484 |
Business Acquisition, Pro Forma Information | The following financial information presents the combined results of continuing operations for the year ended December 31, 2015, as if the acquisitions had been completed on January 1, 2015. As mentioned above, the results of NaviNet and HCS are included in the Company’s Consolidated and Combined Financial Statements beginning on January 1, 2016 and July 1, 2015, respectively. The unaudited pro forma results do not reflect any material adjustments, operating efficiencies or potential cost savings that may result from the consolidation of operations. Year Ended December 31, 2016 2015 Net revenue $ 100,380 $ 119,786 Net loss (184,102 ) (122,555 ) |
Accounts Receivable, net (Table
Accounts Receivable, net (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Receivables [Abstract] | |
Schedule Of Activity In The Allowance For Doubtful Accounts | A summary of activity in the allowance for doubtful accounts for the years ended December 31, 2016 , 2015 and 2014 is as follows: Balance at beginning of the year Additions to expense (Write offs) / Recoveries Balance at the end of the year Year Ended December 31, 2016 $ 956 543 (1,047 ) $ 452 Year Ended December 31, 2015 $ 277 694 (15 ) $ 956 Year Ended December 31, 2014 $ 373 145 (241 ) $ 277 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories, net | Inventories as of December 31, 2016 and 2015 consisted of the following: December 31, 2016 2015 Finished goods $ 1,840 $ 2,005 Raw Materials 377 141 Inventories $ 2,217 $ 2,146 |
Prepaid Expenses and Other Cu39
Prepaid Expenses and Other Current Assets and Accrued and Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Other Current Assets And Other Current Liabilities [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets as of December 31, 2016 and 2015 consisted of the following: December 31, 2016 2015 Prepaid expenses $ 4,685 $ 2,161 Restricted cash (1) 100 — Deferred equity offering costs (See Note 1) — 3,902 Escrow receivable (See Note 3) — 2,494 Other current assets 261 150 Prepaid expenses and other current assets $ 5,046 $ 8,707 (1) Additional $250 of non-current restricted cash is included in the Company’s Consolidated and Combined Balance Sheets as part of Other assets. |
Schedule of Accrued and Other Current Liabilities | Accrued and other current liabilities of December 31, 2016 and 2015 consisted of the following: December 31, 2016 2015 Payroll and related costs $ 13,248 $ 7,194 Other accrued and other current liabilities 11,983 8,773 Accrued and other current liabilities $ 25,231 $ 15,967 |
Property, Plant and Equipment40
Property, Plant and Equipment, net (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, net | Property, plant and equipment, net as of December 31, 2016 and 2015 consisted of the following: December 31, Useful life (in years) 2016 2015 Computer equipment and software 3-5 $ 16,080 $ 9,865 Furniture and equipment 5-7 7,533 6,772 Leasehold and building improvements (1) 4,051 1,433 Internal use software 3 15,600 1,018 Construction in progress 1,090 1,462 44,354 20,550 Less: Accumulated depreciation and amortization (15,215 ) (6,651 ) Property, plant and equipment, net $ 29,139 $ 13,899 (1) Useful life for leasehold and building improvements represents the term of the lease or the estimated life of the related improvements, whichever is shorter. |
Intangible Assets, net (Tables)
Intangible Assets, net (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets | The Company’s definite-lived intangible assets as of December 31, 2016 and 2015 consisted of the following: December 31, 2016 Customer Relationships Developed Technologies Software License Intellectual Property Trade Name Total Gross carrying amount $ 65,200 $ 98,930 $ 5,000 $ 2,400 $ 3,000 $ 174,530 Accumulated amortization (7,707 ) (44,665 ) (1,562 ) (720 ) (750 ) (55,404 ) Intangible assets, net $ 57,493 $ 54,265 $ 3,438 $ 1,680 $ 2,250 $ 119,126 December 31, 2015 Customer Relationships Developed Technologies Software License Intellectual Property Trade Name Total Gross carrying amount $ 13,200 $ 66,930 $ 5,000 $ 2,400 $ — $ 87,530 Accumulated amortization (1,680 ) (30,326 ) (313 ) (240 ) — (32,559 ) Intangible assets, net $ 11,520 $ 36,604 $ 4,687 $ 2,160 $ — $ 54,971 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | The estimated future intangibles amortization expense over the next five years and thereafter for the intangible assets that exist as of December 31, 2016 is as follows: Amounts 2017 $ 19,078 2018 18,478 2019 18,166 2020 14,958 2021 11,646 Thereafter 36,800 Total future intangibles amortization expense $ 119,126 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Goodwill activity during the years ended December 31, 2015 and 2016 is shown as follows: Amounts Balance at January 1, 2015 $ 33,368 Activity during the year: HCS acquisition (See Note 3) 23,350 Balance at December 31, 2015 56,718 Activity during the year: NaviNet acquisition (See Note 3) 74,076 HCS measurement period adjustment (See Note 3) 274 Net activity during the year 74,350 Balance at December 31, 2016 $ 131,068 |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments | The Company used the following summarized financial information for NantOmics for the trailing twelve months ended September 30, 2016 to record its equity investment method losses for the year ended December 31, 2016 : Trailing Twelve Months Ended September 30, 2016 Sales $ 5,189 Gross loss (5,752 ) Loss from operations (42,215 ) Net loss (36,435 ) Net loss attributable to NantOmics (34,236 ) |
Convertible Notes (Tables)
Convertible Notes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Convertible Debt | The following table summarizes how the issuance of the Convertible Notes is reflected in the Company's Consolidated and Combined Balance sheet as of December 31, 2016 : Related party Others Total Gross proceeds $ 10,000 $ 97,000 $ 107,000 Interest make-whole derivative (148 ) (1,351 ) (1,499 ) Conversion option reported in equity as additional paid-in capital (2,233 ) (21,688 ) (23,921 ) Deferred financing offering costs (65 ) (3,249 ) (3,314 ) Amortization of debt discounts and deferred financing offering costs 10 98 108 Unamortized debt discounts and deferred financing offering costs (2,436 ) (26,190 ) (28,626 ) Net carrying amount $ 7,564 $ 70,810 $ 78,374 |
Schedule of Interest Expense | The following table sets forth the Company's interest expense incurred for the year ended December 31, 2016 : Related party Others Total Accrued coupon interest expense $ 15 $ 139 $ 154 Amortization of debt discounts 10 86 96 Amortization of deferred financing offering costs — 12 12 Total convertible notes interest expense $ 25 $ 237 $ 262 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | Assets and liabilities measured at fair value on a recurring basis as of December 31, 2016 and 2015 consisted of the following: December 31, 2016 Total fair value Quoted price in active markets for identical assets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets Cash equivalents $ 149,067 $ 149,067 $ — $ — Marketable securities — — — — 149,067 149,067 — — Liabilities - Interest make-whole derivative 271 — — 271 December 31, 2015 Total fair value Quoted price in active markets for identical assets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets Cash equivalents $ 630 $ 630 $ — $ — Marketable securities 1,243 1,243 — — 1,873 1,873 — — |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following tables set forth a summary of changes in the fair value of Level 3 liabilities for the year ended December 31, 2016 : December 31, 2015 Additions Change in fair value December 31, 2016 Interest make-whole derivative liability: Related party $ — $ 148 $ (123 ) $ 25 Others — 1,351 (1,105 ) 246 $ — $ 1,499 $ (1,228 ) $ 271 |
Fair Value, Liabilities Measured on Recurring and Nonrecurring Basis | A s of December 31, 2016 , the fair value and carrying value of the Company's Convertible Notes were: Fair value Carrying value Face value 5.5% convertible senior notes due December 15, 2021: Related party $ 11,081 $ 7,564 $ 10,000 Others 107,491 70,810 97,000 $ 118,572 $ 78,374 $ 107,000 |
Fair Value, Assets Measured on Recurring Basis | The following table presents the activity of the Company’s financial assets and liabilities that were measured at fair value using significant unobservable inputs during the year ended December 31, 2014: Amounts Balance at December 31, 2013 $ 13,833 Fair value adjustment 172 Derecognition upon acquisition (See Note 3) (14,005 ) Balance at December 31, 2014 $ — |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | As of December 31, 2016 , the Company’s future minimum rental commitments under its non-cancellable operating leases are as follows: Amounts 2017 $ 4,568 2018 2,539 2019 641 2020 508 2021 327 Total minimum rental commitments $ 8,583 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of provision for income taxes | The components of the provision for income taxes are presented in the following table: Year Ended December 31, 2016 2015 2014 Current: Federal $ 228 $ 338 $ — State 28 52 5 Foreign 318 15 — Total current provision 574 405 5 Deferred: Federal (11,864 ) — — State (2,671 ) — — Entity status change (8,725 ) — — Foreign (125 ) — — Total deferred benefit (23,385 ) — — Provision for (benefit from) income taxes, net $ (22,811 ) $ 405 $ 5 |
Schedule of Effective Income Tax Rate Reconciliation | The provision for income taxes differs from the amount of income tax determined by applying the applicable U.S. statutory federal income tax rate to pretax loss as a result of the following differences: Year Ended December 31, 2016 2015 2014 United States federal tax at statutory rate 34.00 % 34.00 % 34.00 % Items affecting federal income tax rate: State tax rate, net of federal benefit 4.02 % 0.07 % — % Pass - through losses (7.04 )% (30.70 )% (26.50 )% Valuation allowance (28.04 )% (2.60 )% (5.90 )% LLC conversion to C corporation 10.29 % — % — % Stock compensation (1.08 )% — % — % Other adjustments (1.13 )% (1.47 )% (1.60 )% Effective income tax rate 11.02 % (0.70 )% — % |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred tax assets and liabilities as of December 31, 2016 and 2015 are as follows: December 31, 2016 2015 Deferred income tax assets: Accounts payable and accrued expenses $ 3,231 $ 29 Inventory impairment 431 255 Deferred revenue 10,229 841 Allowance for doubtful accounts 124 399 Property, plant and equipment, net 3,279 131 Intangibles 2,918 36 Investments 15,653 — Stock compensation 11,574 — Other 1,144 59 Net operating loss carryforwards 93,974 37,387 Less: Valuation allowance (88,861 ) (30,850 ) Total deferred income tax assets 53,696 8,287 Deferred income tax liabilities: Accounts receivable, net (250 ) — State taxes (2,933 ) (1,290 ) Intangible assets, net (36,581 ) (6,812 ) Convertible notes (9,700 ) — Deferred implementation cost (3,753 ) — Other (1,233 ) (185 ) Total deferred income tax liabilities (54,450 ) (8,287 ) Deferred income taxes, net $ (754 ) $ — |
Summary of Valuation Allowance | A summary of activity in the valuation reserve deducted from deferred tax assets for the years ended December 31, 2016 , 2015 and 2014 is as follows: Balance at beginning of the year Additions (Adjustments) Deductions Balance at the end of the year Year to Date December 31, 2016 $ 30,849 66,731 (8,719 ) $ 88,861 Year to Date December 31, 2015 $ 28,995 1,854 — $ 30,849 Year to Date December 31, 2014 $ 22,746 6,249 — $ 28,995 |
Schedule of Unrecognized Tax Benefits Roll Forward | December 31, 2016 2015 Balance as of January 1 $ 879 $ — Increases related to tax positions taken during the current year 98 879 Balance as of December 31 $ 977 $ 879 |
Redeemable Series F Units _ C48
Redeemable Series F Units / Common Stock (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Temporary Equity Disclosure [Abstract] | |
Schedule of Change in Net Carrying Amount of Equity Interests Owned by Buyer | The change in net carrying amount of the Series F units and common stock owned by KIO for the years ended December 31, 2016 , 2015 and 2014 consisted of the following: Redeemable Series F Units Redeemable Common Stock Common Stock and Additional-Paid-in-Capital Balance at December 31, 2013 $ — $ — $ — Issuance of units 150,000 — — Balance at December 31, 2014 150,000 — — Accretion to redemption value 16,042 — — Balance at December 31, 2015 166,042 — — Accretion to redemption value 4,375 — — Balance at June 1, 2016 pre-LLC Conversion 170,417 — — LLC Conversion (170,417 ) 170,417 — Balance at June 1, 2016 post-LLC Conversion — 170,417 — Accretion to redemption value — 583 — Balance at June 20, 2016 pre expiration of Put Right — 171,000 — Expiration of Put Right at June 20, 2016 — (171,000 ) 171,000 Balance at June 20, 2016 post expiration of Put Right and at December 31, 2016 $ — $ — $ 171,000 |
Non-Controlling Interests (Tabl
Non-Controlling Interests (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Noncontrolling Interest [Abstract] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net | The following table shows the effects of changes in NantHealth’s ownership interest in its subsidiaries on NantHealth’s members’ equity during the year ended December 31, 2014: Amounts Net loss attributable to NantHealth $ (84,425 ) Transfers to (from) the non-controlling interests: Increase in NantHealth’s Series A members’ equity upon sale of Qi Imaging (See Note 21) 5,439 Decrease in NantHealth’s Series A members’ equity for acquisition of eviti’s non-controlling interests (75 ) Decrease in NantHealth’s Series A members’ equity for acquisition of iSirona’s non-controlling interests (4,817 ) Net transfers to (from) non-controlling interests 547 Change from net loss attributable to NantHealth and transfers to (from) the non-controlling interests $ (83,878 ) |
Stockholders_ Equity (Tables)
Stockholders’ Equity (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Schedule Of Member Units, Pre-Conversion | Below is a summary of the number of member units pre LLC Conversion as converted into common shares: Pre Conversion (Units) Former Series A Unit Holders 420,255,676 Former Series B Unit Holders 19,109,603 Former Series C Unit Holders 3,470,254 Former Series D Unit Holders 3,572,066 Former Series E Unit Holders 35,720,664 Former Series G Unit Holders 59,099,908 Former Series H Unit Holders 15,513,726 Total Member Units 556,741,897 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs | The following table reflects the components of stock-based compensation expense recognized in the Company's Consolidated and Combined Statements of Operations: Year Ended December 31, 2016 2015 2014 Series C / Restricted Stock - Research and development $ (238 ) $ 1,429 $ 340 Phantom units: Cost of revenue 8,415 — — Selling, general and administrative 28,534 — — Research and development 17,187 — — Total phantom units stock-based compensation expense 54,136 — — Stock options - Selling, general and administrative 54 — — Total stock-based compensation expense 53,952 1,429 340 Amount capitalized to internal-use software and deferred implementation costs 2,433 — — Total stock-based compensation cost $ 56,385 $ 1,429 $ 340 |
Schedule of Share-based Compensation, Activity | The following table summarizes the activity related to the unvested phantom units during the years ended December 31, 2016 , 2015 and 2014 : Number of Units Weighted Average Grant date value per phantom unit Unvested phantom units outstanding - December 31, 2013 and 2014 — — Granted 5,079,187 $15.78 Vested — — Forfeited (1,356,273 ) $15.79 Unvested phantom units outstanding - December 31, 2015 3,722,914 $15.78 Granted 3,024,430 $14.07 Vested (1,638,617 ) $15.02 Forfeited (786,646 ) $15.38 Unvested phantom units outstanding - December 31, 2016 4,322,081 $14.95 |
Schedule of Share-based Compensation, Stock Options, Activity | A summary of the Company’s stock options information as of December 31, 2016 is presented as follows: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Weighted Average grant date fair value Intrinsic Value Outstanding 500,000 $14.00 9.9 $11.98 $— Vested and Expected to Vest — — — — — Exercisable — — — — — |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The fair value of options at the date of grant, and the weighted-average assumptions utilized to determine such values for the year ended December 31, 2016 are indicated in the following table: Amounts Risk-free interest rates 1.56 % Expected dividend yield — % Expected life 3.4 yrs Expected volatility 40.0 % |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted net income (loss) per share of common stock and redeemable common stock for the years ended December 31, 2016 , 2015 and 2014 : Year ended December 31, 2016 2015 2014 Common Stock Redeemable Common Stock Common Stock Redeemable Common Stock Common Stock Income (loss) per share numerator: Net loss attributed to NantHealth $ (184,102 ) $ — $ (72,011 ) $ — $ (84,425 ) Accretion to redemption value of series F/redeemable common stock (4,958 ) 4,958 (16,042 ) 16,042 — Net income (loss) for basic/diluted net income (loss) per share $ (189,060 ) $ 4,958 $ (88,053 ) $ 16,042 $ (84,425 ) Income (loss) per share denominator: Weighted-average shares for basic net loss per share 111,600,650 5,005,855 88,970,842 10,714,285 74,505,127 Effect of dilutive securities — — — — — Weighted-average shares for dilutive net income (loss) per share 111,600,650 5,005,855 88,970,842 10,714,285 74,505,127 Basic and diluted net income (loss) per share $ (1.69 ) $ 0.99 $ (0.99 ) $ 1.50 $ (1.13 ) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following number of potential common shares at the end of each period were excluded from the calculation of diluted net loss per share attributable to common stockholders because their effect would have been anti-dilutive for the periods presented: Year Ended December 31, 2016 2015 2014 Unvested restricted stock 6,976 10,462 13,948 Unvested phantom units 4,322,081 3,722,914 — Stock options 500,000 — — Convertible notes 8,815,655 — — |
Selected Quarterly Financial 53
Selected Quarterly Financial Information (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information | The following tables show a summary of the Company’s quarterly financial information for each of the four quarters of the years ended December 31, 2016 and 2015 (Unaudited): Year Ended December 31, 2016 Fourth Quarter Third Quarter Second Quarter First Quarter Net revenue $ 24,082 $ 25,357 $ 31,490 $ 19,451 Gross profit 4,262 8,121 9,250 6,413 Loss from operations (31,636 ) (32,263 ) (64,133 ) (33,469 ) Net loss (59,951 ) (36,874 ) (54,132 ) (33,145 ) Net income (loss) per share: Basic and diluted - common stock (0.49 ) (0.30 ) (0.54 ) (0.36 ) Basic and diluted - redeemable common stock N/A N/A 0.25 N/A Year Ended December 31, 2015 Fourth Quarter Third Quarter Second Quarter First Quarter Net revenue $ 20,405 $ 14,405 $ 11,752 $ 11,742 Gross profit 9,552 2,314 5,453 6,176 Loss from operations (15,001 ) (23,620 ) (17,343 ) (14,939 ) Net loss (17,852 ) (22,958 ) (17,236 ) (13,965 ) Net income (loss) per share: Basic and diluted - common stock (0.35 ) (0.24 ) (0.21 ) (0.17 ) Basic and diluted - redeemable common stock 1.50 N/A N/A N/A |
Description of Business and B54
Description of Business and Basis of Presentation - Initial Public Offering and LLC Conversion (Details) $ / shares in Units, $ in Thousands | Jun. 09, 2016$ / sharesshares | Jun. 07, 2016USD ($)$ / sharesshares | Jun. 01, 2016 | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) |
Class of Stock [Line Items] | ||||||
Reverse stock split, conversion ratio | 0.1818 | |||||
Proceeds from initial public offering, net of offering costs | $ 83,566 | $ 0 | $ 0 | |||
Offering costs for initial public offering | $ 13,034 | |||||
IPO | ||||||
Class of Stock [Line Items] | ||||||
Issuance of membership interests, shares | shares | 6,500,000 | |||||
Offering price per share (usd per share) | $ / shares | $ 14 | |||||
Proceeds from initial public offering, net of offering costs | $ 83,566 | |||||
Offering costs for initial public offering | $ 13,034 | |||||
Over allotment option | ||||||
Class of Stock [Line Items] | ||||||
Issuance of membership interests, shares | shares | 400,000 | |||||
Offering price per share (usd per share) | $ / shares | $ 14 |
Summary of Significant Accoun55
Summary of Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2016segment | |
Accounting Policies [Abstract] | |
Number of reportable segments | 1 |
Summary of Significant Accoun56
Summary of Significant Accounting Policies - Concentration of Risk (Details) - Customer Concentration Risk | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue | Customer A | ||
Concentration Risk [Line Items] | ||
Concentration percentage | 10.60% | 14.70% |
Revenue | Customer B | ||
Concentration Risk [Line Items] | ||
Concentration percentage | 10.20% | 0.00% |
Accounts Receivable | Customer A | ||
Concentration Risk [Line Items] | ||
Concentration percentage | 7.90% | 0.00% |
Accounts Receivable | Customer B | ||
Concentration Risk [Line Items] | ||
Concentration percentage | 7.60% | 0.00% |
Business Combinations - Narrati
Business Combinations - Narrative (Details) - USD ($) | Jan. 01, 2016 | Jul. 01, 2015 | Jun. 16, 2015 | May 31, 2015 | Jun. 18, 2014 | Dec. 31, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Nov. 30, 2015 | Jun. 17, 2014 | Dec. 31, 2013 |
Business Acquisition [Line Items] | |||||||||||||||||||||||
Goodwill | $ 131,068,000 | $ 131,068,000 | $ 56,718,000 | $ 33,368,000 | $ 131,068,000 | $ 56,718,000 | $ 33,368,000 | ||||||||||||||||
Assumed indebtedness repaid at closing of acquisition | 0 | 0 | 1,975,000 | ||||||||||||||||||||
Compensation expense post-acquisition | 53,952,000 | 1,429,000 | 340,000 | ||||||||||||||||||||
Measurement period adjustments during period | 274,000 | 0 | 0 | ||||||||||||||||||||
Reclassification from AOCI | 0 | 0 | (332,000) | ||||||||||||||||||||
Related party receivables | 2,870,000 | 2,870,000 | 2,545,000 | 2,870,000 | 2,545,000 | ||||||||||||||||||
Revenue | $ 24,082,000 | $ 25,357,000 | $ 31,490,000 | $ 19,451,000 | $ 20,405,000 | $ 14,405,000 | $ 11,752,000 | $ 11,742,000 | 100,380,000 | 58,304,000 | 33,921,000 | ||||||||||||
Net loss | (184,102,000) | $ (72,011,000) | (84,617,000) | ||||||||||||||||||||
Series A Units | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Compensation expense post-acquisition | $ 105,000 | ||||||||||||||||||||||
NDO | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Related party receivables | $ 6,393,000 | ||||||||||||||||||||||
NaviNet, Inc. | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Percentage of voting interest acquired | 100.00% | ||||||||||||||||||||||
Cash paid in business acquisition | $ 83,529,000 | ||||||||||||||||||||||
Fair value of units transferred in acquisition | 52,500,000 | ||||||||||||||||||||||
Contingent arrangements or earnouts, maximum | $ 12,250,000 | ||||||||||||||||||||||
Working capital settlement payment (released) to/from escrow | 455,000 | $ 455,000 | |||||||||||||||||||||
Escrow deposits received from working capital adjustment | $ 2,409,000 | ||||||||||||||||||||||
Goodwill | 74,076,000 | ||||||||||||||||||||||
Assumed indebtedness repaid at closing of acquisition | 23,324,000 | ||||||||||||||||||||||
Post-acquisition payout which represented the fair value of stock options | $ 7,394,000 | ||||||||||||||||||||||
Compensation expense post-acquisition | 4,814,000 | ||||||||||||||||||||||
Measurement period adjustments during period | (300,000) | ||||||||||||||||||||||
Measurement period adjustment, increase to goodwill related to decrease in property and equipment | 2,909,000 | ||||||||||||||||||||||
Measurement period adjustment, decrease to goodwill related to increase in R&D grant receivable | (697,000) | ||||||||||||||||||||||
Measurement period adjustment, decrease to goodwill related to decrease in deferred revenue | (955,000) | ||||||||||||||||||||||
Measurement period adjustment, increase to goodwill related to a deferred tax liability increase | 209,000 | ||||||||||||||||||||||
Measurement period adjustment, increase to goodwill related to working capital increase | 455,000 | ||||||||||||||||||||||
Measurement period adjustment, increase to goodwill related to increase to accrued sales tax liability | 188,000 | ||||||||||||||||||||||
Measurement period adjustment, decrease to goodwill representing the Company's right to reimbursement from seller | (2,409,000) | ||||||||||||||||||||||
Term of agreement for severance benefits reimbursement | 12 months | ||||||||||||||||||||||
Funds held in escrow for settlement of net working capital | $ 6,126,000 | ||||||||||||||||||||||
NaviNet, Inc. | Series H units | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of shares issued in acquisition | 15,513,726 | ||||||||||||||||||||||
Fair value of units transferred in acquisition | $ 52,500,000 | ||||||||||||||||||||||
NantCloud Services, LLC | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Percentage of voting interest acquired | 100.00% | ||||||||||||||||||||||
Cash paid in business acquisition | $ 7,227,000 | ||||||||||||||||||||||
Healthcare Solutions (HCS) | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Cash paid in business acquisition | $ 50,556,000 | ||||||||||||||||||||||
Working capital settlement payment (released) to/from escrow | $ (2,494,000) | $ 2,494,000 | |||||||||||||||||||||
Goodwill | 23,624,000 | ||||||||||||||||||||||
Measurement period adjustments during period | $ 274,000 | ||||||||||||||||||||||
Funds held in escrow for settlement of net working capital | $ 7,500,000 | ||||||||||||||||||||||
NDO | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Percentage of voting interest acquired | 100.00% | ||||||||||||||||||||||
Cash paid in business acquisition | $ 2,335,000 | ||||||||||||||||||||||
Estimated lives of definite-lived intangible assets | 7 years | ||||||||||||||||||||||
Goodwill | 27,438,000 | ||||||||||||||||||||||
Aggregate consideration | $ 32,958,000 | ||||||||||||||||||||||
Ownership percentage | 39.10% | ||||||||||||||||||||||
Unrealized losses | $ 504,000 | ||||||||||||||||||||||
Revenue | 1,041,000 | ||||||||||||||||||||||
Net loss | $ 11,221,000 | ||||||||||||||||||||||
NDO | Accumulated Unrealized Losses | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Reclassification from AOCI | $ 332,000 | ||||||||||||||||||||||
NDO | Equity Issued in Business Combination | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Volatility rate | 45.00% | ||||||||||||||||||||||
Risk free rate | 0.95% | ||||||||||||||||||||||
NDO | Series A Units | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of shares issued in acquisition | 6,905,566 | ||||||||||||||||||||||
NDO | Series C units | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Number of shares issued in acquisition | 18,348 | ||||||||||||||||||||||
NDO | Series A Preferred Stock | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Shares owned | 13,712,558 | ||||||||||||||||||||||
Trade names | NaviNet, Inc. | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Estimated lives of definite-lived intangible assets | 4 years | ||||||||||||||||||||||
Customer relationships | NaviNet, Inc. | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Estimated lives of definite-lived intangible assets | 15 years | ||||||||||||||||||||||
Customer relationships | Healthcare Solutions (HCS) | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Estimated lives of definite-lived intangible assets | 5 years | ||||||||||||||||||||||
Developed technology | NaviNet, Inc. | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Estimated lives of definite-lived intangible assets | 7 years | ||||||||||||||||||||||
Developed technology | Healthcare Solutions (HCS) | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Estimated lives of definite-lived intangible assets | 7 years | ||||||||||||||||||||||
Developed technology | NDO | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Estimated lives of definite-lived intangible assets | 7 years | ||||||||||||||||||||||
Discount rate | 9.00% | ||||||||||||||||||||||
Trademarks | Healthcare Solutions (HCS) | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Estimated lives of definite-lived intangible assets | 5 years | ||||||||||||||||||||||
Backlog | Healthcare Solutions (HCS) | |||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||
Estimated lives of definite-lived intangible assets | 5 years |
Business Combinations - Summary
Business Combinations - Summary of Purchase Consideration (Details) - USD ($) $ in Thousands | Jan. 01, 2016 | Jul. 01, 2015 | Jun. 18, 2014 | Jun. 30, 2016 | Mar. 31, 2016 | Jun. 17, 2014 |
Business Acquisition [Line Items] | ||||||
Percentage of interest in acquiree before acquisition | 60.90% | |||||
Percentage of interest to be acquired in acquisition | 39.10% | |||||
NaviNet, Inc. | ||||||
Business Acquisition [Line Items] | ||||||
Cash paid to 3BE at closing | $ 74,823 | |||||
Cash paid to option holders after closing | 2,580 | |||||
Cash paid to escrow account | 6,126 | |||||
Working capital settlement payment (released) to/from escrow | 455 | $ 455 | ||||
Fair value of units transferred in acquisition | 52,500 | |||||
Total consideration | $ 136,484 | |||||
Healthcare Solutions (HCS) | ||||||
Business Acquisition [Line Items] | ||||||
Cash paid to 3BE at closing | $ 43,056 | |||||
Cash paid to escrow account | 7,500 | |||||
Working capital settlement payment (released) to/from escrow | (2,494) | $ 2,494 | ||||
Total consideration | $ 48,062 | |||||
NDO | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of acquired 60.9% interest | $ 16,619 | |||||
Fair value of previously owned 39.1% investment | 14,005 | |||||
Debt repayment to NDO founder | 2,335 | |||||
Interest-bearing liabilities assumed | 722 | |||||
Settlement of preexisting relationships | 6,393 | |||||
Total consideration | $ 40,074 |
Business Combinations - Allocat
Business Combinations - Allocation of Total Consideration to Net Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Jan. 01, 2016 | Dec. 31, 2015 | Jul. 01, 2015 | Dec. 31, 2014 | Jun. 18, 2014 |
Business Acquisition [Line Items] | ||||||
Goodwill | $ 131,068 | $ 56,718 | $ 33,368 | |||
NaviNet, Inc. | ||||||
Business Acquisition [Line Items] | ||||||
Cash, cash equivalents, and restricted cash | $ 4,804 | |||||
Accounts receivable, net | 10,693 | |||||
Property, plant and equipment | 5,044 | |||||
Other assets and liabilities, net | 4,561 | |||||
Accounts payable | (4,585) | |||||
Accrued and other current liabilities | (3,674) | |||||
Deferred revenue | (2,603) | |||||
Deferred tax liability | (15,508) | |||||
Assumed indebtedness | (23,324) | |||||
Goodwill | 74,076 | |||||
Total fair value of net assets acquired | 136,484 | |||||
NaviNet, Inc. | Trade names | ||||||
Business Acquisition [Line Items] | ||||||
Definite-lived intangible assets | 3,000 | |||||
NaviNet, Inc. | Developed technology | ||||||
Business Acquisition [Line Items] | ||||||
Definite-lived intangible assets | 32,000 | |||||
NaviNet, Inc. | Customer relationships | ||||||
Business Acquisition [Line Items] | ||||||
Definite-lived intangible assets | $ 52,000 | |||||
Healthcare Solutions (HCS) | ||||||
Business Acquisition [Line Items] | ||||||
Accounts receivable, net | $ 13,119 | |||||
Other liabilities, net | (2,205) | |||||
Deferred revenue | (16,076) | |||||
Goodwill | 23,624 | |||||
Total fair value of net assets acquired | 48,062 | |||||
Healthcare Solutions (HCS) | Trademarks | ||||||
Business Acquisition [Line Items] | ||||||
Definite-lived intangible assets | 2,400 | |||||
Healthcare Solutions (HCS) | Developed technology | ||||||
Business Acquisition [Line Items] | ||||||
Definite-lived intangible assets | 14,400 | |||||
Healthcare Solutions (HCS) | Customer relationships | ||||||
Business Acquisition [Line Items] | ||||||
Definite-lived intangible assets | 8,900 | |||||
Healthcare Solutions (HCS) | Backlog | ||||||
Business Acquisition [Line Items] | ||||||
Definite-lived intangible assets | $ 3,900 | |||||
NDO | ||||||
Business Acquisition [Line Items] | ||||||
Cash, cash equivalents, and restricted cash | $ 29 | |||||
Property, plant and equipment | 332 | |||||
Non-cash net working capital, excluding deferred revenue | (3,773) | |||||
Deferred revenue | (7,352) | |||||
Goodwill | 27,438 | |||||
Total fair value of net assets acquired | 40,074 | |||||
NDO | Developed technology | ||||||
Business Acquisition [Line Items] | ||||||
Definite-lived intangible assets | $ 23,400 |
Business Combinations - Pro For
Business Combinations - Pro Forma Financial Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Business Combinations [Abstract] | ||
Net revenue | $ 100,380 | $ 119,786 |
Net loss | $ (184,102) | $ (122,555) |
Accounts Receivable, net (Detai
Accounts Receivable, net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Receivables [Abstract] | |||
Outstanding and unpaid invoices excluded from accounts receivable and deferred revenue | $ 5,325 | $ 12,643 | |
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Allowance for doubtful accounts, current | 452 | 956 | $ 277 |
Allowance for doubtful accounts | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at beginning of the year | 956 | 277 | 373 |
Additions (Adjustments) | 543 | 694 | 145 |
Deductions | (1,047) | (15) | (241) |
Balance at the end of the year | $ 452 | $ 956 | $ 277 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 1,840 | $ 2,005 |
Raw Materials | 377 | 141 |
Inventories | $ 2,217 | $ 2,146 |
Prepaid Expenses and Other Cu63
Prepaid Expenses and Other Current Assets and Accrued and Other Current Liabilities - Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Other Current Assets And Other Current Liabilities [Abstract] | ||
Prepaid expenses | $ 4,685 | $ 2,161 |
Restricted cash | 100 | 0 |
Deferred equity offering costs (See Note 1) | 0 | 3,902 |
Escrow receivable (See Note 3) | 0 | 2,494 |
Other current assets | 261 | 150 |
Prepaid expenses and other current assets | 5,046 | $ 8,707 |
Non-current restricted cash | $ 250 |
Prepaid Expenses and Other Cu64
Prepaid Expenses and Other Current Assets and Accrued and Other Current Liabilities - Accrued and Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Other Current Assets And Other Current Liabilities [Abstract] | ||
Payroll and related costs | $ 13,248 | $ 7,194 |
Other accrued and other current liabilities | 11,983 | 8,773 |
Accrued and other current liabilities | $ 25,231 | $ 15,967 |
Property, Plant and Equipment65
Property, Plant and Equipment, net (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 44,354,000 | $ 20,550,000 | |
Less: Accumulated depreciation and amortization | (15,215,000) | (6,651,000) | |
Property, plant, and equipment, net | 29,139,000 | 13,899,000 | |
Depreciation expense | 8,088,000 | 3,660,000 | $ 1,451,000 |
Amount capitalized to internal use software | 14,582,000 | 1,018,000 | |
Computer equipment and software | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 16,080,000 | 9,865,000 | |
Computer equipment and software | Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 3 years | ||
Computer equipment and software | Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 5 years | ||
Furniture and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 7,533,000 | 6,772,000 | |
Furniture and equipment | Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 5 years | ||
Furniture and equipment | Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 7 years | ||
Leasehold and building improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 4,051,000 | 1,433,000 | |
Internal use software | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 3 years | ||
Property, plant and equipment, gross | $ 15,600,000 | 1,018,000 | |
Depreciation expense | 1,766,000 | 0 | $ 0 |
Construction in progress | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 1,090,000 | $ 1,462,000 |
Intangible Assets, net - Schedu
Intangible Assets, net - Schedule of Definite-Lived Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 174,530 | $ 87,530 |
Accumulated amortization | (55,404) | (32,559) |
Intangible assets, net | 119,126 | 54,971 |
Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 65,200 | 13,200 |
Accumulated amortization | (7,707) | (1,680) |
Intangible assets, net | 57,493 | 11,520 |
Developed Technologies | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 98,930 | 66,930 |
Accumulated amortization | (44,665) | (30,326) |
Intangible assets, net | 54,265 | 36,604 |
Software License | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 5,000 | 5,000 |
Accumulated amortization | (1,562) | (313) |
Intangible assets, net | 3,438 | 4,687 |
Intellectual Property | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 2,400 | 2,400 |
Accumulated amortization | (720) | (240) |
Intangible assets, net | 1,680 | 2,160 |
Trade Name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 3,000 | 0 |
Accumulated amortization | (750) | 0 |
Intangible assets, net | $ 2,250 | $ 0 |
Intangible Assets, net - Narrat
Intangible Assets, net - Narrative (Details) - USD ($) | Sep. 29, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Finite-Lived Intangible Assets [Line Items] | |||||
Amortization expense | $ 22,845,000 | $ 12,127,000 | $ 14,727,000 | ||
Remaining amount due | 174,530,000 | 87,530,000 | |||
Impairment loss on software license intangible asset | 24,150,000 | ||||
NaviNet, Inc. | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Definite-lived intangible assets recorded in period | $ 87,000,000 | ||||
NaviNet, Inc. | Minimum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated lives of definite-lived intangible assets | 4 years | ||||
NaviNet, Inc. | Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated lives of definite-lived intangible assets | 15 years | ||||
Healthcare Solutions (HCS) | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Definite-lived intangible assets recorded in period | $ 29,600,000 | ||||
Healthcare Solutions (HCS) | Minimum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated lives of definite-lived intangible assets | 5 years | ||||
Healthcare Solutions (HCS) | Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated lives of definite-lived intangible assets | 7 years | ||||
NDO | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Definite-lived intangible assets recorded in period | $ 23,400,000 | ||||
Estimated lives of definite-lived intangible assets | 7 years | ||||
Licensing agreement | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Definite-lived intangible assets recorded in period | $ 34,500,000 | ||||
Payments for software license | $ 34,000,000 | ||||
Remaining amount due | $ 5,000,000 | $ 5,000,000 | |||
Estimated lives of definite-lived intangible assets | 5 years | ||||
License fee | $ 5,000,000 | ||||
Annual royalty expense for first four years on license agreement | $ 750,000 | ||||
Number of years minimum royalties to be paid on license agreement | 4 years | ||||
Maximum period royalties paid on license agreement | 7 years | ||||
Licensing agreement | Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Aggregate royalties for license agreement | $ 5,000,000 | ||||
Accrued and Other Current Liabilities | Licensing agreement | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Remaining amount due | $ 500,000 |
Intangible Assets, net - Sche68
Intangible Assets, net - Schedule of Future Amortization of Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2,017 | $ 19,078 | |
2,018 | 18,478 | |
2,019 | 18,166 | |
2,020 | 14,958 | |
2,021 | 11,646 | |
Thereafter | 36,800 | |
Intangible assets, net | $ 119,126 | $ 54,971 |
Goodwill - Goodwill Activity (D
Goodwill - Goodwill Activity (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Goodwill [Roll Forward] | |||
Goodwill, beginning balance | $ 56,718,000 | $ 33,368,000 | |
Goodwill acquired (See Note 3) | 74,076,000 | 23,350,000 | |
HCS measurement period adjustment (See Note 3) | 274,000 | 0 | $ 0 |
Net activity during the year | 74,350,000 | ||
Goodwill, ending balance | $ 131,068,000 | $ 56,718,000 | $ 33,368,000 |
Goodwill - Narrative (Details)
Goodwill - Narrative (Details) - USD ($) | Jan. 01, 2016 | Jul. 01, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Goodwill [Line Items] | |||||
Goodwill added during period | $ 74,076,000 | $ 23,350,000 | |||
Total measurement adjustments to goodwill | (26,000) | ||||
Measurement period adjustments during period | 274,000 | $ 0 | $ 0 | ||
Qi Imaging | |||||
Goodwill [Line Items] | |||||
Ownership percentage | 80.00% | ||||
Goodwill derecognized | $ 424,000 | ||||
NaviNet, Inc. | |||||
Goodwill [Line Items] | |||||
Goodwill added during period | $ 74,076,000 | ||||
Measurement period adjustments during period | (300,000) | ||||
Healthcare Solutions (HCS) | |||||
Goodwill [Line Items] | |||||
Goodwill added during period | $ 23,624,000 | ||||
Measurement period adjustments during period | $ 274,000 |
Investments - Narrative (Detail
Investments - Narrative (Details) - USD ($) $ in Thousands | Sep. 08, 2015 | Jun. 30, 2015 | Jun. 19, 2015 | Jun. 16, 2015 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Schedule of Equity Method Investments [Line Items] | ||||||||
Investments in unconsolidated related parties | $ 0 | $ 150,816 | $ 3,319 | |||||
(Loss) income from related party equity method investments | $ (40,994) | $ (2,584) | 1,525 | |||||
Translational Research Management, LLC (TRM) | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Proceeds from divestiture of investment | $ 250 | |||||||
Conversion of Series A Units to Common Stock | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Number of shares from conversion of Series A units | 44,778 | |||||||
Translational Research Management, LLC (TRM) | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Percentage of voting interest acquired | 54.00% | |||||||
Cash paid in business acquisition | $ 250 | |||||||
Translational Research Management, LLC (TRM) | Series A Units | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Number of shares issued in acquisition | 267,905 | |||||||
NantOmics | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Number of A-2 units purchased (in shares) | 101,078,167 | 67,385,444 | 169,074,539 | |||||
Aggregate purchase price | $ 250,774 | $ 250,774 | ||||||
Investments in unconsolidated related parties | 250,000 | |||||||
Number of A-2 units issued to company (in shares) | 610,928 | |||||||
Ownership percentage | 14.28% | |||||||
Difference between the carrying value and equity, intangible assets | 28,195 | 28,195 | ||||||
Difference between the carrying value and equity, goodwill | 14,382 | 14,382 | ||||||
(Loss) income from related party equity method investments | $ (2,584) | $ (40,994) | ||||||
Other than temporary impairment on equity method investment | 29,816 | |||||||
NantPharma | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
(Loss) income from related party equity method investments | $ 0 | $ 0 | $ 1,525 | |||||
IOBS | Variable Interest Entity, Not Primary Beneficiary | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
IOBS investment | $ 1,750 | |||||||
Number of shares acquired in IOBS | 1,750,000 | |||||||
Percentage of ownership in variable interest entity | 35.00% |
Investments - Summarized Financ
Investments - Summarized Financial Information (Details) - NantOmics $ in Thousands | 12 Months Ended |
Sep. 30, 2016USD ($) | |
Schedule of Equity Method Investments [Line Items] | |
Sales | $ 5,189 |
Gross loss | (5,752) |
Loss from operations | (42,215) |
Net loss | (36,435) |
Net loss attributable to NantOmics | $ (34,236) |
Variable Interest Entities (Det
Variable Interest Entities (Details) $ in Thousands | Jun. 16, 2015USD ($) | Jun. 17, 2014directorentity | Dec. 31, 2016director | Jun. 18, 2014 |
NDO | ||||
Variable Interest Entity [Line Items] | ||||
Percentage of voting interest acquired | 100.00% | |||
Variable Interest Entity, Primary Beneficiary | ||||
Variable Interest Entity [Line Items] | ||||
Number of entities the Company was a primary beneficiary | entity | 2 | |||
Variable Interest Entity, Not Primary Beneficiary | IOBS | ||||
Variable Interest Entity [Line Items] | ||||
IOBS investment | $ | $ 1,750 | |||
Percentage of ownership in variable interest entity | 35.00% | |||
Number of directors NantHealth has right to elect | 2 | |||
Number of directors on IOBS board | 5 | |||
Variable Interest Entity, Not Primary Beneficiary | NDO | ||||
Variable Interest Entity [Line Items] | ||||
Number of directors NantHealth has right to elect | 3 | |||
Number of directors on IOBS board | 6 |
Convertible Notes - Narrative (
Convertible Notes - Narrative (Details) | 12 Months Ended | ||||
Dec. 31, 2016USD ($)Day | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 21, 2016USD ($)$ / shares | Dec. 15, 2016USD ($) | |
Debt Instrument [Line Items] | |||||
Proceeds from issuance of convertible notes to related party, net of offering costs | $ 9,917,000 | $ 0 | $ 0 | ||
Proceeds from issuance of convertible notes to others, net of offering costs | 92,797,000 | $ 0 | $ 0 | ||
Initial purchasers' discount and debt issuance costs | $ 4,286,000 | ||||
Number of consecutive trading days trading price evaluated | 5 days | ||||
Convertible debt | |||||
Debt Instrument [Line Items] | |||||
Face value of debt | $ 107,000,000 | $ 107,000,000 | |||
Interest rate on debt | 5.50% | 5.50% | |||
Proceeds from issuance of convertible notes, net of offering costs | $ 102,714,000 | ||||
Initial purchasers' discount and debt issuance costs | $ 4,286,000 | ||||
Conversion rate of convertible debt | 82.3893 | ||||
Conversion price of convertible debt (usd per share) | $ / shares | $ 12.14 | ||||
Threshold of trading days | Day | 20 | ||||
Threshold consecutive trading days | 30 days | ||||
Threshold percentage of stock price trigger | 120.00% | ||||
Discount rate | 2.00% | ||||
Total liability component of convertible notes on date of issuance | $ 83,079,000 | ||||
Interest make-whole derivative on date of issuance | $ 1,499,000 | 1,499,000 | |||
Carrying value of convertible notes on date of issuance | 78,374,000 | $ 81,580,000 | |||
Conversion option reported in equity as additional paid-in capital | $ 23,921,000 | ||||
Business day period trading price evaluated | 5 days | ||||
Threshold percentage of principal amount | 98.00% | ||||
Purchasers' initial discount | $ 972,000 | ||||
Deferred financing offering costs | $ 3,314,000 | ||||
Effective interest rate | 12.82% | ||||
Convertible debt | Initial Purchasers Agreement | |||||
Debt Instrument [Line Items] | |||||
Face value of debt | $ 90,000,000 | ||||
Proceeds from issuance of convertible notes, net of offering costs | 92,797,000 | ||||
Convertible debt | Cambridge Purchase Agreement | |||||
Debt Instrument [Line Items] | |||||
Face value of debt | 10,000,000 | ||||
Proceeds from issuance of convertible notes, net of offering costs | 9,917,000 | ||||
Convertible debt | Pursuant to the exercise of the overallotment by the Initial Purchasers | |||||
Debt Instrument [Line Items] | |||||
Face value of debt | $ 7,000,000 |
Convertible Notes - Summary of
Convertible Notes - Summary of Issuance of Convertible Debt (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 15, 2016 | |
Debt Disclosure [Abstract] | ||
Remaining life of convertible notes | 60 months | |
Convertible debt | ||
Debt Instrument [Line Items] | ||
Face value of debt | $ 107,000 | |
Interest make-whole derivative | (1,499) | $ (1,499) |
Conversion option reported in equity as additional paid-in capital | (23,921) | |
Deferred financing offering costs | (3,314) | |
Amortization of debt discounts and deferred financing offering costs | 108 | |
Unamortized debt discounts and deferred financing offering costs | (28,626) | |
Net carrying amount | 78,374 | $ 81,580 |
Convertible debt | Related Party | ||
Debt Instrument [Line Items] | ||
Face value of debt | 10,000 | |
Interest make-whole derivative | (148) | |
Conversion option reported in equity as additional paid-in capital | (2,233) | |
Deferred financing offering costs | (65) | |
Amortization of debt discounts and deferred financing offering costs | 10 | |
Unamortized debt discounts and deferred financing offering costs | (2,436) | |
Net carrying amount | 7,564 | |
Convertible debt | Others | ||
Debt Instrument [Line Items] | ||
Face value of debt | 97,000 | |
Interest make-whole derivative | (1,351) | |
Conversion option reported in equity as additional paid-in capital | (21,688) | |
Deferred financing offering costs | (3,249) | |
Amortization of debt discounts and deferred financing offering costs | 98 | |
Unamortized debt discounts and deferred financing offering costs | (26,190) | |
Net carrying amount | $ 70,810 |
Convertible Notes - Interest Ex
Convertible Notes - Interest Expense Incurred (Details) - Convertible debt $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Debt Instrument [Line Items] | |
Accrued coupon interest expense | $ 154 |
Amortization of debt discounts | 96 |
Amortization of deferred financing offering costs | 12 |
Interest expense on debt | 262 |
Related Party | |
Debt Instrument [Line Items] | |
Accrued coupon interest expense | 15 |
Amortization of debt discounts | 10 |
Amortization of deferred financing offering costs | 0 |
Interest expense on debt | 25 |
Others | |
Debt Instrument [Line Items] | |
Accrued coupon interest expense | 139 |
Amortization of debt discounts | 86 |
Amortization of deferred financing offering costs | 12 |
Interest expense on debt | $ 237 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - Recurring basis - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Assets | ||
Cash equivalents | $ 149,067 | $ 630 |
Marketable securities | 0 | 1,243 |
Assets | 149,067 | 1,873 |
Liabilities | ||
Interest make-whole derivative | 271 | |
Quoted price in active markets for identical assets (Level 1) | ||
Assets | ||
Cash equivalents | 149,067 | 630 |
Marketable securities | 0 | 1,243 |
Assets | 149,067 | 1,873 |
Liabilities | ||
Interest make-whole derivative | 0 | |
Significant other observable inputs (Level 2) | ||
Assets | ||
Cash equivalents | 0 | 0 |
Marketable securities | 0 | 0 |
Assets | 0 | 0 |
Liabilities | ||
Interest make-whole derivative | 0 | |
Significant unobservable inputs (Level 3) | ||
Assets | ||
Cash equivalents | 0 | 0 |
Marketable securities | 0 | 0 |
Assets | 0 | $ 0 |
Liabilities | ||
Interest make-whole derivative | $ 271 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2016 | Dec. 21, 2016 | |
Convertible debt | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Face value of debt | $ 107,000,000 | $ 107,000,000 | $ 107,000,000 |
Period that must lapse prior to conversion for noteholder to receive interest make-whole payment | 1 year | ||
Discount rate | 2.00% | ||
Threshold period used to compute interest payment | 3 years | ||
Convertible debt | Related Party | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Face value of debt | $ 10,000,000 | $ 10,000,000 | |
Derivative liability | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Discount rate | 2.00% |
Fair Value Measurements - Chang
Fair Value Measurements - Changes in the Fair Value of Level 3 Liabilities (Details) - Derivative liability $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Interest make-whole derivative | $ 0 |
Additions | 1,499 |
Change in fair value | (1,228) |
Interest make-whole derivative | 271 |
Related Party | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Interest make-whole derivative | 0 |
Additions | 148 |
Change in fair value | (123) |
Interest make-whole derivative | 25 |
Others | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Interest make-whole derivative | 0 |
Additions | 1,351 |
Change in fair value | (1,105) |
Interest make-whole derivative | $ 246 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value of Debt (Details) - Convertible debt - USD ($) | Dec. 31, 2016 | Dec. 21, 2016 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Face value of debt | $ 107,000,000 | $ 107,000,000 |
Related Party | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Face value of debt | 10,000,000 | |
Others | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Face value of debt | 97,000,000 | |
Fair value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value | 118,572,000 | |
Fair value | Related Party | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value | 11,081,000 | |
Fair value | Others | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value | 107,491,000 | |
Carrying value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value | 78,374,000 | |
Carrying value | Related Party | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value | 7,564,000 | |
Carrying value | Others | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value | $ 70,810,000 |
Fair Value Measurements - Fai81
Fair Value Measurements - Fair Value of NDO (Details) - Investments $ in Thousands | 12 Months Ended |
Dec. 31, 2014USD ($) | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance at December 31, 2013 | $ 13,833 |
Fair value adjustment | 172 |
Derecognition upon acquisition (See Note 3) | (14,005) |
Balance at December 31, 2014 | $ 0 |
Commitments and Contingencies -
Commitments and Contingencies - Lease Arrangements (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Operating Leased Assets [Line Items] | |||
Rental expense charged to selling, general and administrative expense | $ 4,526 | $ 2,108 | $ 1,348 |
Minimum | |||
Operating Leased Assets [Line Items] | |||
Remaining lives of operating leases | 1 year | 1 year | |
Maximum | |||
Operating Leased Assets [Line Items] | |||
Remaining lives of operating leases | 5 years | 5 years |
Commitments and Contingencies83
Commitments and Contingencies - Future Minimum Rental Commitments (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2,017 | $ 4,568 |
2,018 | 2,539 |
2,019 | 641 |
2,020 | 508 |
2,021 | 327 |
Total minimum rental commitments | $ 8,583 |
Commitments and Contingencies84
Commitments and Contingencies - Related Party Promissory Note (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Jan. 04, 2016 | Dec. 31, 2015 |
Related Party Transaction [Line Items] | |||
Related party promissory note | $ 112,666 | $ 0 | |
Affiliated Entity | Promissory Notes With NantCapital | |||
Related Party Transaction [Line Items] | |||
Related party promissory note | $ 118,253 | $ 112,666 |
Commitments and Contingencies85
Commitments and Contingencies - Indenture Obligations Under Convertible Notes (Details) - Convertible debt - USD ($) | Dec. 31, 2016 | Dec. 21, 2016 |
Debt Instrument [Line Items] | ||
Face value of debt | $ 107,000,000 | $ 107,000,000 |
Interest rate on debt | 5.50% | 5.50% |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Provision (Details) - USD ($) $ in Thousands | Jun. 01, 2016 | May 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Current: | |||||
Federal | $ 228 | $ 338 | $ 0 | ||
State | 28 | 52 | 5 | ||
Foreign | 318 | 15 | 0 | ||
Total current provision | 574 | 405 | 5 | ||
Deferred: | |||||
Federal | (11,864) | 0 | 0 | ||
State | (2,671) | 0 | 0 | ||
Entity status change | (8,725) | 0 | 0 | ||
Foreign | (125) | 0 | 0 | ||
Total deferred benefit | (23,385) | 0 | 0 | ||
Provision for (benefit from) income taxes, net | $ (8,725) | $ (5,986) | $ (22,811) | $ 405 | $ 5 |
Income Taxes - Effective Income
Income Taxes - Effective Income Tax Reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
United States federal tax at statutory rate | 34.00% | 34.00% | 34.00% |
Items affecting federal income tax rate: | |||
State tax rate, net of federal benefit | 4.02% | 0.07% | 0.00% |
Pass - through losses | (7.04%) | (30.70%) | (26.50%) |
Valuation allowance | (28.04%) | (2.60%) | (5.90%) |
LLC conversion to C corporation | 10.29% | 0.00% | 0.00% |
Stock compensation | (1.08%) | 0.00% | 0.00% |
Other adjustments | (1.13%) | (1.47%) | (1.60%) |
Effective income tax rate | 11.02% | (0.70%) | 0.00% |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred income tax assets: | ||
Accounts payable and accrued expenses | $ 3,231 | $ 29 |
Inventory impairment | 431 | 255 |
Deferred revenue | 10,229 | 841 |
Allowance for doubtful accounts | 124 | 399 |
Property, plant and equipment, net | 3,279 | 131 |
Intangibles | 2,918 | 36 |
Investments | 15,653 | 0 |
Stock compensation | 11,574 | 0 |
Other | 1,144 | 59 |
Net operating loss carryforwards | 93,974 | 37,387 |
Less: Valuation allowance | (88,861) | (30,850) |
Total deferred income tax assets | 53,696 | 8,287 |
Deferred income tax liabilities: | ||
Accounts receivable, net | (250) | 0 |
State taxes | (2,933) | (1,290) |
Intangible assets, net | (36,581) | (6,812) |
Convertible notes | (9,700) | 0 |
Deferred implementation cost | (3,753) | 0 |
Other | (1,233) | (185) |
Total deferred income tax liabilities | 54,450 | 8,287 |
Deferred income taxes, net | $ (754) | $ 0 |
Income Taxes - Valuation Reserv
Income Taxes - Valuation Reserve (Details) - Valuation Allowance of Deferred Tax Assets [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at beginning of the year | $ 30,849 | $ 28,995 | $ 22,746 |
Additions (Adjustments) | 66,731 | 1,854 | 6,249 |
Deductions | (8,719) | 0 | 0 |
Balance at the end of the year | $ 88,861 | $ 30,849 | $ 28,995 |
Income Taxes - Uncertain Tax Po
Income Taxes - Uncertain Tax Positions (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Balance as of January 1 | $ 879 | $ 0 |
Increases related to tax positions taken during the current year | 98 | 879 |
Balance as of December 31 | $ 977 | $ 879 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | Jun. 01, 2016 | May 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Income Tax Disclosure [Abstract] | |||||
Unrecognized tax benefits, excluding gross deferred tax asset and payable | $ 977 | $ 879 | |||
Unrecognized tax benefit, reducing gross deferred income tax asset | 382 | ||||
Unrecognized tax benefit, increasing income tax payable | 595 | ||||
Operating Loss Carryforwards [Line Items] | |||||
Income tax benefit | $ (8,725) | $ (5,986) | (22,811) | $ 405 | $ 5 |
Adjustments to additional paid-in capital for convertible debt | 8,631 | ||||
Federal | |||||
Operating Loss Carryforwards [Line Items] | |||||
Operating loss carryforwards | 238,865 | ||||
State | |||||
Operating Loss Carryforwards [Line Items] | |||||
Operating loss carryforwards | 169,840 | ||||
Foreign | |||||
Operating Loss Carryforwards [Line Items] | |||||
Operating loss carryforwards | $ 2,565 |
Redeemable Series F Units _ C92
Redeemable Series F Units / Common Stock - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | Jun. 01, 2016 | Jun. 20, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Redeemable Noncontrolling Interest [Line Items] | |||||
Accretion to redemption value | $ 4,958 | $ 16,042 | $ 0 | ||
Redeemable Series F Units | |||||
Redeemable Noncontrolling Interest [Line Items] | |||||
Number of units sold in private placement, units | 53,580,996 | ||||
Offering price per share (usd per share) | $ 2.7995 | ||||
Aggregate amount received in private placement | $ 150,000 | ||||
Private placement, interest payable, percent | 7.00% | ||||
Number of shares as a result of conversion of units, shares | 10,714,285 |
Redeemable Series F Units _ C93
Redeemable Series F Units / Common Stock - Schedule of Redeemable Series F Units (Details) - USD ($) $ in Thousands | Jun. 20, 2016 | Jun. 01, 2016 | Jun. 20, 2016 | May 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Redeemable Noncontrolling Interest, Equity, Redemption Value [Roll Forward] | |||||||
Accretion to redemption value | $ 4,958 | $ 16,042 | $ 0 | ||||
LLC Conversion | 0 | ||||||
Redeemable common stock put right expiration | 171,000 | 0 | 0 | ||||
Redeemable Series F Units | |||||||
Redeemable Noncontrolling Interest, Equity, Redemption Value [Roll Forward] | |||||||
Beginning balance, Redeemable Series F units and common stock | $ 170,417 | $ 166,042 | 166,042 | 150,000 | 0 | ||
Issuance of units | 150,000 | ||||||
Accretion to redemption value | $ 4,375 | 16,042 | |||||
LLC Conversion | (170,417) | ||||||
Ending balance, Redeemable Series F units and common stock | $ 170,417 | $ 166,042 | $ 150,000 | ||||
Redeemable Common Stock | |||||||
Redeemable Noncontrolling Interest, Equity, Redemption Value [Roll Forward] | |||||||
Beginning balance, Redeemable Series F units and common stock | 170,417 | ||||||
Accretion to redemption value | 583 | ||||||
LLC Conversion | 170,417 | ||||||
Redeemable common stock put right expiration | $ (171,000) | ||||||
Ending balance, Redeemable Series F units and common stock | 171,000 | 170,417 | $ 171,000 | ||||
Common Stock Including Additional Paid in Capital | |||||||
Redeemable Noncontrolling Interest, Equity, Redemption Value [Roll Forward] | |||||||
LLC Conversion | $ 525,388 | ||||||
Redeemable common stock put right expiration | $ 171,000 | ||||||
Ending balance, Redeemable Series F units and common stock | $ 171,000 |
Non-Controlling Interests - Nar
Non-Controlling Interests - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | Jun. 01, 2016 | Dec. 31, 2012 | Jun. 30, 2014 | Oct. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Oct. 31, 2012 |
Noncontrolling Interest [Line Items] | ||||||||
Cash paid to non-controlling interests | $ 0 | $ 0 | $ 5,608 | |||||
Stock-based compensation expense | $ 53,952 | $ 1,429 | 340 | |||||
Series A Units | ||||||||
Noncontrolling Interest [Line Items] | ||||||||
Units issued, price per unit (usd per share) | $ 1 | |||||||
Stock-based compensation expense | $ 105 | |||||||
eviti | Series A Units | ||||||||
Noncontrolling Interest [Line Items] | ||||||||
Shares issued in exchange for non-controlling interests | 567,930 | |||||||
eviti | Series C units | ||||||||
Noncontrolling Interest [Line Items] | ||||||||
Shares issued in exchange for non-controlling interests | 1,515 | |||||||
iSirona | ||||||||
Noncontrolling Interest [Line Items] | ||||||||
Cash paid to non-controlling interests | $ 20,202 | $ 5,608 | ||||||
Upfront cash payment | $ 13,468 | |||||||
iSirona | Series A Units | ||||||||
Noncontrolling Interest [Line Items] | ||||||||
Shares issued in exchange for non-controlling interests | 6,131,800 | |||||||
Number of units sold in private placement, units | 2,553,238 | |||||||
iSirona | Series A Units | Maximum | ||||||||
Noncontrolling Interest [Line Items] | ||||||||
Shares issued in exchange for non-controlling interests | 9,197,700 | |||||||
Units Issued to Noncontrolling Interests | eviti | Series A and Series C units | ||||||||
Noncontrolling Interest [Line Items] | ||||||||
Number of shares as a result of conversion of units, shares | 94,908 | |||||||
Units Issued to Former Unit Holders | iSirona | Series A Units | ||||||||
Noncontrolling Interest [Line Items] | ||||||||
Number of shares as a result of conversion of units, shares | 1,024,877 | |||||||
Units Issued for Purchase Of Noncontrolling Interest | iSirona | Series A Units | ||||||||
Noncontrolling Interest [Line Items] | ||||||||
Number of shares as a result of conversion of units, shares | 426,754 |
Non-Controlling Interests - Eff
Non-Controlling Interests - Effects of Changes in NantHealth's Ownership Interest in Subsidiaries (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Noncontrolling Interest [Line Items] | |||||||||||
Net loss | $ (59,951) | $ (36,874) | $ (54,132) | $ (33,145) | $ (17,852) | $ (22,958) | $ (17,236) | $ (13,965) | $ (184,102) | $ (72,011) | $ (84,425) |
Transfers to (from) the non-controlling interests: | |||||||||||
Net transfers to (from) non-controlling interests | 547 | ||||||||||
Change from net loss attributable to NantHealth and transfers to (from) the non-controlling interests | (83,878) | ||||||||||
Qi Imaging | |||||||||||
Transfers to (from) the non-controlling interests: | |||||||||||
Increase in NantHealth’s Series A members’ equity upon sale of Qi Imaging (See Note 21) | 5,439 | ||||||||||
eviti | |||||||||||
Transfers to (from) the non-controlling interests: | |||||||||||
Decrease in NantHealth’s Series A members’ equity for acquisition of non-controlling interests | (75) | ||||||||||
iSirona | |||||||||||
Transfers to (from) the non-controlling interests: | |||||||||||
Decrease in NantHealth’s Series A members’ equity for acquisition of non-controlling interests | $ (4,817) |
Stockholders_ Equity - Narrativ
Stockholders’ Equity - Narrative (Details) | Aug. 09, 2016USD ($)shares | Jul. 25, 2016USD ($)shares | Jun. 09, 2016$ / sharesshares | Jun. 07, 2016USD ($)$ / sharesshares | Jun. 01, 2016USD ($)shares | Jan. 01, 2016USD ($)$ / sharesshares | Jun. 29, 2015USD ($)$ / sharesshares | Jan. 01, 2015USD ($) | Apr. 28, 2014USD ($)$ / sharesshares | Mar. 31, 2014USD ($)$ / sharesshares | Jul. 31, 2014USD ($)shares | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2016USD ($)vote$ / sharesshares | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Oct. 31, 2012$ / shares |
Class of Stock [Line Items] | ||||||||||||||||
Proceeds from initial public offering, net of offering costs | $ 83,566,000 | $ 0 | $ 0 | |||||||||||||
Offering costs for initial public offering | 13,034,000 | |||||||||||||||
Amount of principal and interest under promissory note converted to shares | 40,590,000 | 0 | 0 | |||||||||||||
Tax payments related to stock issued | 5,838,000 | 0 | 0 | |||||||||||||
Reverse stock split, conversion ratio | 0.1818 | |||||||||||||||
Conversion of members' interests | $ 0 | |||||||||||||||
Number of votes per unit held | vote | 1 | |||||||||||||||
Common stock authorized (shares) | shares | 750,000,000 | 750,000,000 | ||||||||||||||
Common stock, par value (usd per share) | $ / shares | $ 0.0001 | $ 0.0001 | ||||||||||||||
Preferred stock authorized (shares) | shares | 20,000,000 | 20,000,000 | ||||||||||||||
Preferred stock, par value (usd per share) | $ / shares | $ 0.0001 | $ 0.0001 | ||||||||||||||
Sequencing services, agreement amount | $ 10,000,000 | |||||||||||||||
Deemed capital contribution from Chairman and CEO | $ 3,810,000 | 6,190,000 | 0 | |||||||||||||
Other services | 25,462,000 | 15,202,000 | $ 7,047,000 | |||||||||||||
Research Related Sequencing Services | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Other services | $ 2,286,000 | $ 3,714,000 | ||||||||||||||
NaviNet, Inc. | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Fair value of units transferred in acquisition | $ 52,500,000 | |||||||||||||||
Series H units | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Conversion of members' interests, shares | shares | 3,749,998 | |||||||||||||||
Series H units | NaviNet, Inc. | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Number of shares issued in acquisition | shares | 15,513,726 | |||||||||||||||
Acquisition, purchase price, (usd per share) | $ / shares | $ 3.3841 | |||||||||||||||
Fair value of units transferred in acquisition | $ 52,500,000 | |||||||||||||||
Series G units | Allscripts Healthcare Solutions, Inc. | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Offering price per share (usd per share) | $ / shares | $ 3.3841 | |||||||||||||||
Conversion of members' interests, shares | shares | 14,285,714 | |||||||||||||||
Number of units sold in private placement, units | shares | 59,099,908 | |||||||||||||||
Aggregate amount received in private placement | $ 200,000,000 | |||||||||||||||
Series D units | BlackBerry Corporation | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Offering price per share (usd per share) | $ / shares | $ 2.7995 | |||||||||||||||
Conversion of members' interests, shares | shares | 597,037 | |||||||||||||||
Number of units sold in private placement, units | shares | 3,572,031 | |||||||||||||||
Aggregate amount received in private placement | $ 10,000,000 | |||||||||||||||
Series E units | KIA Investment | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Offering price per share (usd per share) | $ / shares | $ 2.7995 | |||||||||||||||
Number of units sold in private placement, units | shares | 5,000,002 | 35,720,664 | 187,550 | |||||||||||||
Aggregate amount received in private placement | $ 100,000,000 | |||||||||||||||
Former Series A Unit Holders | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Offering price per share (usd per share) | $ / shares | $ 1 | |||||||||||||||
Former Series A Unit Holders | Blackstone Group | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Conversion of members' interests, shares | shares | 31,347 | |||||||||||||||
Number of units sold in private placement, units | shares | 3,572,031 | |||||||||||||||
Aggregate amount received in private placement | $ 525,000 | |||||||||||||||
Common stock | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Issuance of membership interests, shares | shares | 6,900,000 | |||||||||||||||
Shares of common stock issued for vested phantom units | shares | 1,074,949 | |||||||||||||||
Conversion of members' interests, shares | shares | 99,661,906 | 99,661,906 | ||||||||||||||
Conversion of members' interests | $ 10,000 | |||||||||||||||
Common Stock Including Additional Paid in Capital | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Conversion of members' interests | $ 525,388,000 | |||||||||||||||
Equity Method Investee | Promissory Notes With NantOmics | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Amount of principal and interest under promissory note converted to shares | $ 40,590,000 | |||||||||||||||
Number of shares related party promissory note converted | shares | 2,899,297 | |||||||||||||||
IPO | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Issuance of membership interests, shares | shares | 6,500,000 | |||||||||||||||
Offering price per share (usd per share) | $ / shares | $ 14 | |||||||||||||||
Proceeds from initial public offering, net of offering costs | $ 83,566,000 | |||||||||||||||
Offering costs for initial public offering | $ 13,034,000 | |||||||||||||||
Over allotment option | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Issuance of membership interests, shares | shares | 400,000 | |||||||||||||||
Offering price per share (usd per share) | $ / shares | $ 14 | |||||||||||||||
Phantom units | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Shares of common stock issued for vested phantom units | shares | 1,056,689 | |||||||||||||||
Shares withheld to satisfy tax withholding obligations | shares | 538,794 | |||||||||||||||
Tax payments related to stock issued | $ 5,738,000 | |||||||||||||||
Restricted stock | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Conversion of members' interests, shares | shares | 10,462 | |||||||||||||||
Phantom Unit Plan Outside United States | Phantom units | ||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||
Shares of common stock issued for vested phantom units | shares | 16,818 | 16,940 | ||||||||||||||
Amount of cash paid to settle vested phantom units | $ 235,000 | $ 237,000 |
Stockholders_ Equity - Units Co
Stockholders’ Equity - Units Converted to Shares (Details) | Jun. 01, 2016shares |
Capital Unit [Line Items] | |
Number of member units converted to common shares, units | 556,741,897 |
Former Series A Unit Holders | |
Capital Unit [Line Items] | |
Number of member units converted to common shares, units | 420,255,676 |
Former Series B Unit Holders | |
Capital Unit [Line Items] | |
Number of member units converted to common shares, units | 19,109,603 |
Former Series C Unit Holders | |
Capital Unit [Line Items] | |
Number of member units converted to common shares, units | 3,470,254 |
Former Series D Unit Holders | |
Capital Unit [Line Items] | |
Number of member units converted to common shares, units | 3,572,066 |
Former Series E Unit Holders | |
Capital Unit [Line Items] | |
Number of member units converted to common shares, units | 35,720,664 |
Former Series G Unit Holders | |
Capital Unit [Line Items] | |
Number of member units converted to common shares, units | 59,099,908 |
Former Series H Unit Holders | |
Capital Unit [Line Items] | |
Number of member units converted to common shares, units | 15,513,726 |
Stock Based Compensation - Comp
Stock Based Compensation - Components of Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | $ 53,952 | $ 1,429 | $ 340 |
Amount capitalized to internal-use software and deferred implementation costs | 2,433 | 0 | 0 |
Stock-based compensation cost | 56,385 | 1,429 | 340 |
Series C / Restricted Stock | Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | (238) | 1,429 | 340 |
Phantom units | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 54,136 | 0 | 0 |
Phantom units | Cost of revenue | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 8,415 | 0 | 0 |
Phantom units | Selling, general and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 28,534 | 0 | 0 |
Phantom units | Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 17,187 | 0 | 0 |
Stock options | Selling, general and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | $ 54 | $ 0 | $ 0 |
Stock Based Compensation - Narr
Stock Based Compensation - Narrative (Details) $ in Thousands | Aug. 09, 2016USD ($)shares | Jul. 25, 2016USD ($)shares | Jun. 01, 2016shares | Dec. 31, 2016USD ($)shares | Jun. 30, 2016shares | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($)shares | Dec. 31, 2014USD ($) | Mar. 31, 2015shares | Dec. 03, 2013shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Reverse stock split, conversion ratio | 0.1818 | |||||||||
Tax payments related to stock issued | $ | $ 5,838 | $ 0 | $ 0 | |||||||
Stock compensation plan | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of shares as a result of conversion of units, shares | 28,973 | |||||||||
Restricted stock | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of shares as a result of conversion of units, shares | 10,462 | |||||||||
Phantom units | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Units granted to employees of related companies for providing services | 995,364 | |||||||||
Stock-based compensation expense expected to be recognized | $ | $ 29,218 | $ 29,218 | ||||||||
Period for recognition of compensation cost not yet recognized | 2 years 12 days | |||||||||
Shares of common stock issued for vested phantom units | 1,056,689 | |||||||||
Shares withheld to satisfy tax withholding obligations | 538,794 | |||||||||
Tax payments related to stock issued | $ | $ 5,738 | |||||||||
Number of restricted stock units vested and converted to common stock | 1,638,617 | 0 | ||||||||
Number of restricted stock shares not vested | 4,322,081 | 3,722,914 | 4,322,081 | 0 | ||||||
Phantom units | Employee | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock-based compensation expense expected to be recognized | $ | $ 25,875 | $ 25,875 | ||||||||
Period for recognition of compensation cost not yet recognized | 2 years 12 days | |||||||||
Phantom units | Nonemployee | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock-based compensation expense expected to be recognized | $ | 3,343 | $ 3,343 | ||||||||
Period for recognition of compensation cost not yet recognized | 2 years 1 month | |||||||||
Series C units | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Units outstanding | 3,470,254 | 3,470,254 | ||||||||
Series C units | Restricted stock | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock-based compensation expense expected to be recognized | $ | $ 266 | $ 266 | ||||||||
Period for recognition of compensation cost not yet recognized | 1 year 9 months 18 days | |||||||||
Profits Interests Plan | Series C units | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Aggregate units authorized for issuance | 63,750,000 | |||||||||
Phantom Unit Plan | Phantom units | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Aggregate units authorized for issuance | 11,590,909 | |||||||||
Number of shares available for grant | 4,322,081 | 4,322,081 | ||||||||
Phantom Unit Plan in United States | Phantom units | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Shares of common stock issued for vested phantom units | 1,074,949 | |||||||||
Shares withheld to satisfy tax withholding obligations | 546,728 | |||||||||
Tax payments related to stock issued | $ | $ 5,838 | |||||||||
Phantom Unit Plan Outside United States | Phantom units | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Shares of common stock issued for vested phantom units | 16,818 | 16,940 | ||||||||
Amount of cash paid to settle vested phantom units | $ | $ 235 | $ 237 | ||||||||
The 2016 Equity Incentive Plan | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Aggregate units authorized for issuance | 6,000,000 | 6,000,000 | ||||||||
The 2016 Equity Incentive Plan | Series C units | Restricted stock | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of shares as a result of conversion of units, shares | 10,462 | |||||||||
Number of restricted stock units vested and converted to common stock | 3,486 | |||||||||
Number of restricted stock shares not vested | 6,976 | 6,976 |
Stock Based Compensation - Acti
Stock Based Compensation - Activity of Phantom Units (Details) - Phantom units - $ / shares | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Dec. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2016 | |
Number of Units | |||
Unvested phantom units outstanding, beginning balance (in units) | 0 | 0 | |
Granted (in units) | 3,024,430 | 5,079,187 | |
Vested (in units) | (1,638,617) | 0 | |
Forfeited (in units) | (786,646) | (1,356,273) | |
Unvested phantom units outstanding, ending balance (in units) | 4,322,081 | 3,722,914 | 4,322,081 |
Weighted Average Grant date value per phantom unit | |||
Unvested phantom units outstanding, beginning balance (usd per unit) | $ 0 | $ 0 | |
Granted (usd per unit) | $ 14.07 | 15.78 | |
Vested (usd per unit) | 15.02 | 0 | |
Forfeited (usd per unit) | 15.38 | 15.79 | |
Unvested phantom units outstanding, ending balance (usd per unit) | $ 14.95 | $ 15.78 | $ 14.95 |
Stock Based Compensation - Summ
Stock Based Compensation - Summary of Stock Options (Details) - The 2016 Equity Incentive Plan - Nonemployee Stock Option - Board of Director $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($)$ / sharesshares | |
Share-based Goods and Nonemployee Services Transaction [Line Items] | |
Number of stock options issued | shares | 500,000 |
Exercise price for stock options issued (usd per share) | $ 14 |
Outstanding, Number of Shares (in shares) | shares | 500,000 |
Outstanding, Weighted Average Exercise Price (usd per share) | $ 14 |
Outstanding, Weighted Average Remaining Contractual Life (Years) | 9 years 10 months 7 days |
Outstanding, Weighted Average grant date fair value | $ 11.98 |
Outstanding, Intrinsic Value | $ | $ 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest [Abstract] | |
Vested and Expected to Vest, Number of Shares (in shares) | shares | 0 |
Vested and Expected to Vest, Weighted Average Exercise Price (usd per share) | $ 0 |
Vested and Expected to Vest, Intrinsic Value | $ | $ 0 |
Exercisable, Number of Shares (in shares) | shares | 0 |
Exercisable, Weighted Average Exercise Price (usd per share) | $ 0 |
Exercisable, Intrinsic Value | $ | $ 0 |
Unrecognized stock based compensation expense related to stock options | $ | $ 902 |
Weighted-average peirod unrecognized cost to be recognized over | 9 years 10 months 7 days |
Stock Based Compensation - Weig
Stock Based Compensation - Weighted Average Assumptions (Details) - The 2016 Equity Incentive Plan - Nonemployee Stock Option - Board of Director | 12 Months Ended |
Dec. 31, 2016 | |
Share-based Goods and Nonemployee Services Transaction [Line Items] | |
Risk-free interest rates | 156.00% |
Expected dividend yield | 0.00% |
Expected life | 3 years 4 months 24 days |
Expected volatility | 40.00% |
Net Income (Loss) Per Share - R
Net Income (Loss) Per Share - Reconciliations of the Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||||
Income (loss) per share numerator: | |||||||||||||||
Net loss | $ (59,951) | $ (36,874) | $ (54,132) | $ (33,145) | $ (17,852) | $ (22,958) | $ (17,236) | $ (13,965) | $ (184,102) | $ (72,011) | $ (84,425) | ||||
Accretion to redemption value of series F/redeemable common stock | (4,958) | (16,042) | |||||||||||||
Accretion to redemption value of Series F / redeemable common stock | 4,958 | 16,042 | 0 | ||||||||||||
Net income (loss) for basic/diluted net income (loss) per share | $ (189,060) | $ (88,053) | $ (84,425) | ||||||||||||
Common Stock | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Weighted-average shares for basic net loss per share (shares) | 111,600,650 | 88,970,842 | 74,505,127 | ||||||||||||
Effect of dilutive securities (shares) | 0 | 0 | |||||||||||||
Weighted-average shares for dilutive net loss per share (shares) | 111,600,650 | 88,970,842 | 74,505,127 | ||||||||||||
Basic & Diluted net loss per share (usd per share) | $ (0.49) | $ (0.30) | $ (0.54) | $ (0.36) | $ (0.35) | $ (0.24) | $ (0.21) | $ (0.17) | $ (1.69) | [1],[2] | $ (0.99) | [1],[2] | $ (1.13) | [1] | |
Redeemable Common Stock | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Weighted-average shares for basic net loss per share (shares) | 5,005,855 | 10,714,285 | |||||||||||||
Effect of dilutive securities (shares) | 0 | ||||||||||||||
Weighted-average shares for dilutive net loss per share (shares) | 5,005,855 | 10,714,285 | |||||||||||||
Basic & Diluted net loss per share (usd per share) | [1] | $ 0.25 | $ 1.50 | $ 0.99 | $ 1.50 | ||||||||||
[1] | The net income (loss) per share and weighted-average shares outstanding have been computed to give effect to the LLC Conversion (See Note 16) that occurred on June 1, 2016, prior to the Company’s initial public offering ("IPO"). In conjunction with the LLC Conversion, (a) all of the Company’s outstanding units automatically converted into shares of common stock, based on the relative rights of the Company's pre-IPO equityholders as set forth in the Company's limited liability company agreement and (b) the Company adopted and filed a certificate of incorporation with the Secretary of State of the state of Delaware and adopted bylaws. The Company adopted and filed an amendment to its certificate of incorporation with the Secretary of State of the state of Delaware to effect a 1-for-5.5 reverse stock split of its common stock on June 1, 2016. See Note 20 for the calculation of net income (loss) per share for common stock and redeemable common stock for the years ended December 31, 2016, 2015 and 2014. | ||||||||||||||
[2] | The net income (loss) per share for the common stock for the years ended December 31, 2016 and 2015 reflects $4,958 and $16,042 in accretion value allocated to the redeemable common stock, respectively. The redeemable common stock contained a put right, which expired unexercised on June 20, 2016. As a result of and as of that date, the shares were no longer redeemable and were included in common stock. |
Net Income (Loss) Per Share - N
Net Income (Loss) Per Share - Narrative (Details) | Jun. 01, 2016 |
Earnings Per Share [Abstract] | |
Reverse stock split, conversion ratio | 0.1818 |
Net Income (Loss) Per Share - A
Net Income (Loss) Per Share - Antidilutive Securities (Details) - shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Restricted stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (shares) | 6,976 | 10,462 | 13,948 |
Phantom units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (shares) | 4,322,081 | 3,722,914 | 0 |
Nonemployee Stock Option | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (shares) | 500,000 | 0 | 0 |
Convertible notes | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (shares) | 8,815,655 | 0 | 0 |
Related Party Transactions (Det
Related Party Transactions (Details) | Jun. 01, 2016USD ($)shares | Mar. 08, 2016USD ($) | Jan. 22, 2016USD ($) | Jan. 04, 2016USD ($)$ / shares | Jun. 19, 2015USD ($)termtest | Oct. 31, 2013shares | May 31, 2014USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 21, 2016USD ($) | Dec. 15, 2016USD ($) |
Related Party Transaction [Line Items] | ||||||||||||
Related party receivables | $ 2,870,000 | $ 2,545,000 | ||||||||||
Related party payables, net | 8,082,000 | 10,166,000 | ||||||||||
Related party promissory note | 112,666,000 | 0 | ||||||||||
Amount of principal and interest under promissory note converted to shares | 40,590,000 | 0 | $ 0 | |||||||||
Income from related party equity method investments | (40,994,000) | (2,584,000) | 1,525,000 | |||||||||
Reseller agreement | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Term of agreement with related party | 5 years 6 months | |||||||||||
Affiliated Entity | Shared services agreement | NantWorks | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Net selling, general, and administrative service expenses incurred related to services provided by related parties | 8,879,000 | 10,320,000 | 9,853,000 | |||||||||
Affiliated Entity | Research and development services | NantWorks | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Net expenses incurred related to services provided by related parties | 414,000 | 1,324,000 | 1,530,000 | |||||||||
Affiliated Entity | Receivable from Ziosoft KK related to sale of Qi Imaging | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Related party receivables | 2,126,000 | 2,150,000 | ||||||||||
Affiliated Entity | Promissory Notes With NantCapital | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Related party promissory note | $ 112,666,000 | 118,253,000 | ||||||||||
Interest bearing on related promissory note | $ 5,587,000 | |||||||||||
Note interest rate | 5.00% | |||||||||||
Interest bearing on related promissory note | 5.00% | |||||||||||
Per share price of stock shares to repay debt (usd per share) | $ / shares | $ 18.6126 | |||||||||||
Per share price of shares to settle debt (usd per share) | $ / shares | $ 1.484 | |||||||||||
Affiliated Entity | Exchange Agreement | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Proceeds from sale of business and equity method investment, net of cash transferred | $ 10,000,000 | |||||||||||
Income from related party equity method investments | $ 1,525,000 | |||||||||||
Equity Method Investee | Reseller agreement | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Related party payables | $ 1,950,000 | $ 3,111,000 | ||||||||||
Number of renewals | term | 3 | |||||||||||
Renewal term | 3 years | |||||||||||
Number of tests to qualify for first renewal option | test | 300 | |||||||||||
Number of tests to qualify for second renewal option | test | 570 | |||||||||||
Number of tests to qualify for third renewal option | test | 760 | |||||||||||
Renewal option if threshold unmet, nonexclusive, number of years | 3 years | |||||||||||
Annual minimum fees, tier one | $ 2,000,000 | |||||||||||
Annual minimum fees, tier two | 25,000,000 | |||||||||||
Annual minimum fees, tier three | $ 50,000,000 | |||||||||||
Equity Method Investee | Promissory Notes With NantOmics | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Related party promissory note | $ 20,000,000 | |||||||||||
Interest bearing on related promissory note | 5.00% | |||||||||||
Additional advance on related party promissory note | $ 20,000,000 | |||||||||||
Amount of principal and interest under promissory note converted to shares | $ 40,590,000 | |||||||||||
Number of shares related party promissory note converted | shares | 2,899,297 | |||||||||||
Convertible debt | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Related party debt | $ 107,000,000 | $ 107,000,000 | ||||||||||
Note interest rate | 5.50% | 5.50% | ||||||||||
Convertible debt | Affiliated Entity | Cambridge Purchase Agreement | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Related party debt | $ 10,000,000 | |||||||||||
Interest bearing on related promissory note | $ 15,000 | |||||||||||
Series A Units | Affiliated Entity | Exchange Agreement | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Number of shares issued in acquisition | shares | 3,572,031 |
Employee Retirement Plan (Detai
Employee Retirement Plan (Details) - Other Postretirement Benefit Plan - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
NantHealth 401k Plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Company's matching contribution of employee's percentage contribution, percentage | 100.00% | ||
Percentage of participant's pay which Company contributes matching percentage | 3.00% | ||
Vesting period of matching contribution | 3 years | ||
Companyy' total matching contributions | $ 2,160 | $ 1,079 | $ 551 |
Old iSirona 401k Plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Companyy' total matching contributions | $ 345 | ||
Percentage of participant's pay which Company contributes 100% matching percentage | 3.00% | ||
Percentage of participant's pay which Company contributes 50% matching percentage | 2.00% | ||
Old eviti 401k Plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Percentage of participant's pay which Company contributes matching percentage | 3.00% | ||
Companyy' total matching contributions | $ 220 | ||
Service period required to be participate in plan | 6 months | ||
Minimum required earnings in preceding two years to participate in plan | $ 5 | ||
Maximum annual contributions for associate's under 50 years of age | 12 | ||
Maximum annual contributions for associate's over 50 years of age | $ 15 |
Selected Quarterly Financial108
Selected Quarterly Financial Information (Unaudited) Quarterly Financial Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||||
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||
Net revenue | $ 24,082 | $ 25,357 | $ 31,490 | $ 19,451 | $ 20,405 | $ 14,405 | $ 11,752 | $ 11,742 | $ 100,380 | $ 58,304 | $ 33,921 | ||||
Gross profit | 4,262 | 8,121 | 9,250 | 6,413 | 9,552 | 2,314 | 5,453 | 6,176 | 28,046 | 23,495 | 9,691 | ||||
Loss from operations | (31,636) | (32,263) | (64,133) | (33,469) | (15,001) | (23,620) | (17,343) | (14,939) | (161,501) | (70,903) | (84,680) | ||||
Net loss | $ (59,951) | $ (36,874) | $ (54,132) | $ (33,145) | $ (17,852) | $ (22,958) | $ (17,236) | $ (13,965) | $ (184,102) | $ (72,011) | $ (84,425) | ||||
Common stock | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Basic and diluted (usd per share) | $ (0.49) | $ (0.30) | $ (0.54) | $ (0.36) | $ (0.35) | $ (0.24) | $ (0.21) | $ (0.17) | $ (1.69) | [1],[2] | $ (0.99) | [1],[2] | $ (1.13) | [1] | |
Redeemable common stock | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Basic and diluted (usd per share) | [1] | $ 0.25 | $ 1.50 | $ 0.99 | $ 1.50 | ||||||||||
[1] | The net income (loss) per share and weighted-average shares outstanding have been computed to give effect to the LLC Conversion (See Note 16) that occurred on June 1, 2016, prior to the Company’s initial public offering ("IPO"). In conjunction with the LLC Conversion, (a) all of the Company’s outstanding units automatically converted into shares of common stock, based on the relative rights of the Company's pre-IPO equityholders as set forth in the Company's limited liability company agreement and (b) the Company adopted and filed a certificate of incorporation with the Secretary of State of the state of Delaware and adopted bylaws. The Company adopted and filed an amendment to its certificate of incorporation with the Secretary of State of the state of Delaware to effect a 1-for-5.5 reverse stock split of its common stock on June 1, 2016. See Note 20 for the calculation of net income (loss) per share for common stock and redeemable common stock for the years ended December 31, 2016, 2015 and 2014. | ||||||||||||||
[2] | The net income (loss) per share for the common stock for the years ended December 31, 2016 and 2015 reflects $4,958 and $16,042 in accretion value allocated to the redeemable common stock, respectively. The redeemable common stock contained a put right, which expired unexercised on June 20, 2016. As a result of and as of that date, the shares were no longer redeemable and were included in common stock. |