Natera (NTRA) 10-K 15 Mar 19 2018 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Feb. 28, 2019	Jun. 29, 2018
Document and Entity Information
Entity Registrant Name	Natera, Inc.
Entity Central Index Key	0001604821
Document Type	10-K
Document Period End Date	Dec. 31, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Entity Filer Category	Accelerated Filer
Entity Public Float			$ 620
Entity Common Stock, Shares Outstanding		62,790,368
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	FY

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 46,407	$ 12,620
Restricted cash, current portion	4,597	59
Short-term investments	107,461	106,247
Accounts receivable, net of allowance of $1,788 in 2018 and $2,000 in 2017	62,223	44,089
Inventory	13,633	8,998
Prepaid expenses and other current assets	6,197	8,612
Total current assets	240,518	180,625
Property and equipment, net	24,336	29,667
Restricted cash, long term portion		342
Other assets	3,317	3,979
Total assets	268,171	214,613
Current liabilities:
Accounts payable	14,587	8,529
Accrued compensation	12,668	9,599
Other accrued liabilities	32,442	33,257
Deferred revenue, current portion	4,131	1,420
Short-term debt financing	50,153	50,112
Warrants		2,644
Total current liabilities	113,981	105,561
Long-term debt financing	73,357	73,065
Deferred rent, net of current portion	8,613	9,241
Deferred revenue, long-term portion	40,058
Other long-term liabilities		1,329
Total liabilities	236,009	189,196
Commitments and contingencies (Note 7)
Stockholders' equity:
Preferred stock, $0.0001 par value: 50,000 shares authorized; no shares issued and outstanding at December 31, 2018 and 2017, respectively
Common stock, $0.0001 par value: 750,000 shares authorized at December 31, 2018 and 2017, respectively; 62,083 and 54,040 shares issued and outstanding at December 31, 2018 and 2017, respectively	7	6
Additional paid in capital	607,236	472,552
Accumulated deficit	(574,529)	(446,375)
Accumulated other comprehensive loss	(552)	(766)
Total stockholders' equity	32,162	25,417
Total liabilities and stockholders' equity	$ 268,171	$ 214,613

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Consolidated Balance Sheets
Allowances on accounts receivable	$ 1,788	$ 2,000
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	50,000,000	50,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized	750,000,000	750,000,000
Common stock, shares issued	62,082,348	54,040,000
Common stock, shares outstanding	62,082,348	54,040,000

Consolidated Statements of Oper

Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Revenues
Total revenues	$ 257,654	$ 209,625	$ 212,512
Cost and expenses
Cost of revenues	158,081	135,508	134,494
Cost of licensing and other revenues	7,974	4,088	1,080
Research and development	51,355	50,064	41,862
Selling, general and administrative	154,872	155,306	136,126
Total cost and expenses	372,282	344,966	313,562
Loss income from operations	(114,628)	(135,341)	(101,050)
Interest expense	(10,476)	(4,213)	(533)
Interest and other (expense) income, net	(2,729)	2,380	1,398
Loss before income taxes	(127,833)	(137,174)	(100,185)
Income tax expense	(321)	(454)	(142)
Net loss	(128,154)	(137,628)	(100,327)
Unrealized gain (loss) on available-for-sale securities, net of tax	214	(41)	691
Comprehensive loss	$ (127,940)	$ (137,669)	$ (99,636)
Net loss per share (Note 13):
Basic (in dollars per share)	$ (2.22)	$ (2.58)	$ (1.95)
Diluted (in dollars per share)	$ (2.22)	$ (2.59)	$ (1.95)
Weighted-average number of shares used in computing basic and diluted net loss per share:
Basic (in shares)	57,848	53,312	51,576
Diluted (in shares)	57,848	53,604	51,576
Product
Revenues
Total revenues	$ 240,366	$ 203,777	$ 209,406
Licensing and other
Revenues
Total revenues	$ 17,288	$ 5,848	$ 3,106

Consolidated Statements of Stoc

Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Common stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit	[1]	Total
Balance at Dec. 31, 2015	$ 5	$ 436,259	$ (1,416)	$ (208,420)		$ 226,428
Balance (in shares) at Dec. 31, 2015	50,346,000
Issuance of common stock upon exercise of stock options		3,595				3,595
Issuance of common stock upon exercise of stock options (in shares)	1,913,000
Issuance of common stock under employee stock purchase plan		2,589				2,589
Issuance of common stock under employee stock purchase plan (in shares)	341,000
Vesting of restricted stock (in shares)	65,000
Stock based compensation		10,601				10,601
Unrealized (loss) gain on available-for-sale investments			691			691
Net loss				(100,327)		(100,327)
Balance at Dec. 31, 2016	$ 5	453,044	(725)	(308,747)		143,577
Balance (in shares) at Dec. 31, 2016	52,665,000
Issuance of common stock upon exercise of stock options	$ 1	2,314				2,315
Issuance of common stock upon exercise of stock options (in shares)	565,000
Issuance of common stock under employee stock purchase plan		3,344				3,344
Issuance of common stock under employee stock purchase plan (in shares)	446,000
Issuance of common stock in exchange for commitment to provide debt financing		2,448				2,448
Issuance of common stock in exchange for commitment to provide debt financing (in shares)	300,000
Vesting of restricted stock (in shares)	64,000
Stock based compensation		11,402				11,402
Unrealized (loss) gain on available-for-sale investments			(41)			(41)
Net loss				(137,628)		(137,628)
Balance at Dec. 31, 2017	$ 6	472,552	(766)	(446,375)		$ 25,417
Balance (in shares) at Dec. 31, 2017	54,040,000					54,040,000
Issuance of common stock upon exercise of stock options		13,331				$ 13,331
Issuance of common stock upon exercise of stock options (in shares)	1,967,000
Issuance of common stock under employee stock purchase plan		3,617				3,617
Issuance of common stock under employee stock purchase plan (in shares)	391,000
Issuance of common stock upon exercise of warrants		6,762				6,762
Issuance of common stock upon exercise of warrants (in shares)	333,000
Sale of common stock through equity offering, net of issuance costs	$ 1	96,776				96,777
Sale of common stock through equity offering, net of issuance costs (in shares)	5,175,000
Vesting of restricted stock (in shares)	177,000
Stock based compensation		14,198				14,198
Unrealized (loss) gain on available-for-sale investments			214			214
Net loss				(128,154)		(128,154)
Balance at Dec. 31, 2018	$ 7	$ 607,236	$ (552)	$ (574,529)		$ 32,162
Balance (in shares) at Dec. 31, 2018	62,083,000					62,082,348
[1]	See Note 2 for a summary of adjustments. The cumulative-effect adjustment to Accumulated Deficit resulting from the adoption of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”) as of December 31, 2015 was $41.7 million.

Consolidated Statements of St_2

Consolidated Statements of Stockholders' Equity (Parenthetical) $ in Millions	Dec. 31, 2015USD ($)
Adoption of ASC 606 | Accounting Standards Update 2014-09 | Adjustment
Cumulative effect adjustment	$ 41.7

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Operating activities
Net loss	$ (128,154)	$ (137,628)	$ (100,327)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	7,501	7,143	6,176
Impairment of assets	1,544	576	2,138
Stock-based compensation	14,198	11,402	10,601
Inventory excess adjustments	265	502	2,110
Provision for doubtful accounts	(41)	143	984
Premium amortization and discount accretion on investment securities	238	857	1,445
Loss (gain) realized on investment securities	43	64	(191)
(Gain) loss on sales of property and equipment	(12)	12
Loss (gain) from changes in fair value of warrants	4,118	(1,148)	143
Interest accrued for borrowings and claims related settlement	2,172	488	533
Amortization of debt discount	391	154
Changes in operating assets and liabilities
Accounts receivable	(18,093)	6,315	(3,956)
Inventory	(4,900)	(3,086)	(431)
Prepaid expenses and other current assets	2,643	(1,515)	(2,077)
Other assets	335	600	(2,812)
Accounts payable	3,781	217	1,256
Accrued compensation	3,069	(1,467)	2,515
Other accrued liabilities	(1,820)	14,919	(378)
Deferred revenue	42,769	846	430
Deferred rent, net of current portion	(628)	1,452	7,789
Other long-term liabilities		1,329
Net cash used in operating activities	(70,581)	(97,825)	(74,052)
Investing activities
Purchases of investments	(170,268)	(272,819)	(53,522)
Proceeds from sale of investments	37,387	65,270	59,185
Proceeds from maturity of investments	131,600	231,200	64,500
Purchases of property and equipment, net	(3,880)	(9,867)	(23,136)
Net cash (used in) provided by investing activities	(5,161)	13,784	47,027
Financing activities
Proceeds from exercise of stock options	13,331	2,315	3,595
Proceeds from issuance of common stock under employee stock purchase plan	3,617	3,344	2,589
Proceeds from equity offering, net of issuance costs	96,777
Borrowings under long-term debt facility		75,000
Payment for debt issuance costs on long-term debt facility		(287)
Borrowings under credit facility			8,000
Repayment under credit facility			(1,000)
Net cash provided by financing activities	113,725	80,372	13,184
Net increase (decrease) in cash, cash equivalents and restricted cash	37,983	(3,669)	(13,841)
Cash, cash equivalents and restricted cash, beginning of period	13,021	16,690	30,531
Cash, cash equivalents and restricted cash, end of period	51,004	13,021	16,690
Supplemental disclosure of cash flow information:
Cash paid for income taxes	332	177
Cash paid for interest	7,914	3,568
Non-cash investing and financing activities:
Purchases of property and equipment through accounts payable and accruals	$ 268	$ 447	$ 5,204
Issuance of common stock for exercise of warrants	6,762
Issuance of common stock for lender's commitment to debt financing		2,448

Description of Business

Description of Business	12 Months Ended
	Dec. 31, 2018
Description of Business
Description of Business	1 . Description of Business Natera, Inc. (the "Company") was formed in the state of California as Gene Security Network, LLC in November 2003 and incorporated in the state of Delaware in January 2007. The Company’s mission is to change the management of genetic disease worldwide. The Company operates a laboratory certified under the Clinical Laboratory Improvement Amendments ("CLIA") providing a host of preconception and prenatal genetic testing services. The Company determines its operating segments based on the way it organizes its business to make operating decisions and assess performance. The Company has only one operating segment, which is the discovery, development and commercialization of genetic testing services, and it has a subsidiary that operates in the state of Texas. The Company's product offerings include its Panorama Non-Invasive Prenatal Test ("NIPT") that screens for chromosomal abnormalities of a fetus typically with a blood draw from the mother; Vistara (“Vistara”), a single-gene mutations screening test performed to identify single-gene disorders; Horizon Carrier Screening ("HCS") to determine carrier status for a large number of severe genetic diseases that could be passed on to the carrier’s children; Spectrum Pre-implantation Genetic Screening ("PGS") and Spectrum Pre-implantation Genetic Diagnosis ("PGD") to analyze chromosomal anomalies or inherited genetic conditions during an in vitro fertilization ("IVF") cycle to select embryos with the highest probability of becoming healthy children; Anora Products of Conception ("POC") test to rapidly and extensively analyze fetal chromosomes to understand the cause of miscarriage; Non-Invasive Paternity Testing ("PAT"), to determine paternity by analyzing the fragments of fetal deoxyribonucleic acid ("DNA") in a pregnant mother's blood and a blood sample from the alleged father(s), which is marketed and sold by a licensee from whom the Company receives a royalty. All testing is available principally in the United States, and the Company also offers its Panorama test to customers primarily in Europe. The Company also offers Constellation (“Constellation”), a cloud-based software product that allows laboratory customers to gain access through the cloud to the Company’s algorithms and bioinformatics in order to validate and launch tests based on the Company’s technology. The Company also offers Evercord, which is a cord blood and cord tissue processing and storage service; and Signatera TM , a circulating tumor DNA technology that analyzes and tracks mutations specific to an individual’s tumor, for research use only by oncology researchers and biopharmaceutical companies. Further, the Company has expanded its Panorama test to now screen twin pregnancies for zygosity and chromosomal abnormalities.

Summary of Significant Accounti

Summary of Significant Accounting Policies	12 Months Ended
	Dec. 31, 2018
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	2 . Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”). Liquidity Matters The Company has incurred net losses since its inception and anticipates net losses and negative operating cash flows for the near future. For the year ended December 31, 2018, the Company had a net loss of $128.2 million, which increased the accumulated deficit to $574.6 million from $446.4 million at December 31, 2017 following the full retrospective adoption of ASU 2014-09, which required a cumulative-effect adjustment to be recorded to accumulated deficit as of the earliest period presented in the consolidated financial statements. At December 31, 2018, the Company had $46.4 million in cash and cash equivalents, $107.5 million in marketable securities, $50.2 million of outstanding balance of the Credit Line (as defined in Note 9) including accrued interest, and $73.4 million of net carrying amount of the 2017 Term Loan (as defined in Note 9). While the Company has introduced multiple products that are generating revenues, these revenues have not been sufficient to fund all operations. Accordingly, the Company has funded the portion of operating costs that exceeds revenues through a combination of equity issuances, debt issuances, and financing under the 2017 Term Loan with an option to borrow an additional $50.0 million. The Company continues to develop and commercialize future products and, consequently, it will need to generate additional revenues to achieve future profitability and may need to raise additional equity or debt financing. If the Company raises additional funds by issuing equity securities, its stockholders would experience dilution. Additional debt financing, if available, may involve covenants restricting its operations or its ability to incur additional debt. Any additional debt financing or additional equity that the Company raises may contain terms that are not favorable to it or its stockholders and require significant debt service payments, which diverts resources from other activities. Additional financing may not be available at all, or in amounts or on terms acceptable to the Company. If the Company is unable to obtain additional financing, it may be required to delay the development, commercialization and marking of its products and significantly scale back its business and operations. In July 2018, the Company completed an equity offering to sell 4,500,000 shares of its common stock to the public at a price of $20 per share, along with the sale of 675,000 additional shares of its common stock to the underwriters upon their exercise of the option to purchase those shares. Upon the closing of the equity offering, the Company received proceeds of $97.3 million before offering expenses, which totaled approximately $0.5 million. Based on the Company’s current business plan, the Company believes that its existing cash and marketable securities will be sufficient to meet its anticipated cash requirements for at least 12 months after March 15, 2019. Principles of Consolidation The accompanying consolidated financial statements include all the accounts of the Company and its subsidiary. The Company established a subsidiary that operates in the state of Texas to support the Company’s laboratory and operational functions. All intercompany balances and transactions have been eliminated. Use of Estimates The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions about future events that affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. Significant items subject to such estimates include the allowance for doubtful accounts, deferred revenues associated with unsatisfied performance obligations, accrued liability for potential refund requests, stock-based compensation, the fair value of common stock and warrants, income tax uncertainties, and the expected consideration to be received from contracts with customers. These estimates and assumptions are based on management's best estimates and judgment. Management regularly evaluates its estimates and assumptions using historical experience and other factors, including contractual terms and statutory limits; however, actual results could differ from these estimates and could have an adverse effect on the Company's financial statements. For the year ended December 31, 2018, the Company revised the estimate of its expected consideration for certain genetic test services as the amounts collected from its payers were different than what was initially assessed. The revision of the estimate was treated as a change in accounting estimate. See Note 3 for more detail on this accounting change and its resulting impact on the Company’s financial statements. Fair Value The Company discloses the fair value of financial instruments for financial assets and liabilities for which the value is practicable to estimate. Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). Cash and Cash Equivalents Cash and cash equivalents consist of cash and money market deposits with financial institutions. Restricted Cash As of December 31, 2018, the Company had restricted cash primarily consisting of $4.2 million in cash deposits held to secure a letter of credit associated with a settlement agreement in connection with reimbursement related claims (as described in Note 7 under Legal Proceedings ) and $0.3 million of deposit per credit card terms. The Company adopted Accounting Standard Update No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (“ASU 2016-18”), effective January 1, 2018, which required the change in restricted cash to be included as part of the total cash and cash equivalents. While restricted cash is still presented as a separate line item in the Company’s balance sheet, it is no longer presented as a separate item in the statements of cash flows. ASU 2016-18 also required a restatement of the statements of cash flows in the prior period presented to report this change. The following is the reconciliation between how restricted cash is presented in the balance sheet and the statements of cash flows for all periods presented: December 31, December 31, December 31, December 31, 2018 2017 2016 2015 (in thousands) Cash and cash equivalents in balance sheet $ 46,407 $ 12,620 $ 15,256 $ 28,947 Restricted cash, current portion in balance sheet 4,597 59 1,092 901 Restricted cash in other assets in balance sheet — 342 342 683 Total cash, cash equivalents and restricted cash in statements of cash flows $ 51,004 $ 13,021 $ 16,690 $ 30,531 Investments Investments consist primarily of debt securities such as U.S. Treasuries, U.S. agency and municipal bonds. Management determines the appropriate classification of securities at the time of purchase and reevaluates such determination at each balance sheet date. The Company generally classifies its entire investment portfolio as available-for-sale. The Company views its available-for-sale portfolio as available for use in current operations. Accordingly, the Company classifies all investments as short-term, even though the stated maturity may be more than one year from the current balance sheet date. Available-for-sale securities are carried at fair value, with unrealized gains and losses reported in accumulated other comprehensive income (loss), which is a separate component of stockholders’ equity. Risk and Uncertainties The Company has various financial instruments that are potentially subjected to credit risk, and they consist of cash, accounts receivable and investments. The Company limits its exposure to credit loss by placing its cash in financial institutions with high credit ratings. The Company's cash may consist of deposits held with banks that may at times exceed federally insured limits. The Company performs evaluations of the relative credit standing of these financial institutions and limits the amount of credit exposure with any one institution. The Company bills third-party payers for certain tests performed. The amount that is ultimately received from the payer for the Company’s claim and the timing of such payments are subject to the determination of the payer based on the nature of the test performed and their view of the Company’s business practices with respect to collections of plan deductibles and co-payments from patients and other activities. This determination can impact both the amount and timing of when the Company’s invoices are collected. Payers may also withhold payments and request refunds of prior payments if the payer asserts that the Company has not performed in accordance with the policies of these payers. The Company performs evaluations of financial conditions for clinics and laboratory partners and generally does not require collateral to support credit sales. In 2018, 2017 and 2016, there were no customers exceeding 10% of total revenues on an individual basis. As of December 31, 2018 and 2017, there were no customers with an outstanding balance exceeding 10% of net accounts receivable. Allowance for Doubtful Accounts Trade accounts receivable are recorded at the amount billed to the laboratory partners and clinics. Reducing this amount is an allowance for doubtful accounts for estimated losses resulting from the inability of its customers to make the contracted payments. Management analyzes accounts receivable and historical bad debt experience, customer creditworthiness, current economic trends, and changes in customer payment history when evaluating the adequacy of the allowance for doubtful accounts. Accounts receivable are written off against the allowance when there is substantive evidence that the account will not be paid. Revenue Recognition The Company adopted the new revenue recognition guidance, ASC 606, beginning January 1, 2018 on a full retrospective basis. ASC 606 mandates revenue recognition to be evaluated using the following five steps: · Identification of a contract, or contracts, with a customer; · Identification of the performance obligations in the contract; · Determination of the transaction price; · Allocation of the transaction price to the performance obligations in the contract; and · Revenue recognition when, or as, the performance obligations are satisfied See Note 3, Revenue Recognition, for detailed discussions of product revenues, licensing and other revenues, and how the five steps described above are applied. Cost of Product Revenues The components of cost of product revenues are material and service costs, impairment charges associated with testing equipment, personnel costs, including stock-based compensation expense, equipment and infrastructure expenses associated with testing samples, electronic medical record, order and delivery systems, shipping charges to transport samples, third-party test processing fees and allocated overhead including rent, information technology costs, equipment depreciation and utilities. Costs associated with the performance of diagnostic services are recorded as tests are accessioned. Cost of Licensing and Other Revenues The components of cost of licensing and other revenues are material costs associated with test kits, engineering costs incurred by the research and development team to improve and maintain the Constellation software platform, and amortization of Constellation software development costs. Costs also include collection kits consumed during the processing of cord blood samples, processing service and storage of the cord blood samples, and freight charged to transport the samples to the storage facility. Research and Development The Company records research and development costs in the period incurred. Research and development costs consist of personnel costs, contract services, cost of materials utilized in performing tests, costs of clinical trials and allocated facilities and related overhead expenses. Advertising Costs The Company expenses advertising costs as incurred. The Company incurred advertising costs of $0.2 million, $0.5 million and $0.4 million for the years ended December 31, 2018, 2017 and 2016, respectively. Product Shipment Costs The Company expenses product shipment costs in cost of product revenues in the accompanying statements of operations. Shipping and handling costs for the years ended December 31, 2018, 2017 and 2016 were $12.4 million, $9.5 million and $8.2 million, respectively. Income Taxes Income taxes are recorded in accordance with Financial Accounting Standards Board ASC Topic 740, Income Taxes ("ASC 740"), which provides for deferred taxes using an asset and liability approach. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. Tax benefits are recognized when it is more likely than not that a tax position will be sustained during an audit. Deferred tax assets are reduced by a valuation allowance if current evidence indicates that it is considered more likely than not that these benefits will not be realized. Stock‑Based Compensation Stock‑based compensation related to stock options and restricted stock units (“RSUs”) granted to the Company’s employees is measured at the grant date based on the fair value of the award. The fair value is recognized as expense over the requisite service period, which is generally the vesting period of the respective awards. No compensation cost is recognized when the requisite service has not been met and the awards are therefore forfeited. The Company uses the Black‑Scholes option‑pricing model to estimate the fair value of stock options issued to employees and non-employees. The measurement of stock-based compensation is subject to periodic adjustments as the underlying equity instruments vest, and the resulting change in value, if any, is recognized in the Company's statements of operations and comprehensive loss during the period that the related services are rendered. The Black-Scholes option-pricing model requires the input of the Company's expected stock price volatility, the expected term of the awards, and a risk-free interest rate. Determining these assumptions requires significant judgment. The expected term was based on the simplified method and the volatility rate was based on that of publicly traded companies in the DNA sequencing, diagnostics, or personalized medicine industries. When selecting the public companies in these industries to be used in the volatility calculation, companies were selected with comparable characteristics to the Company, including enterprise value and financial leverage. Companies were also selected with historical share price volatility sufficient to meet the expected term of the Company's stock options. The historical volatility data was computed using the daily closing prices for the selected companies' shares during the equivalent period of the calculated expected term of the Company's stock options. The expected term of the non-employee option grants was based on their remaining contractual life at the measurement date. The risk-free interest rate assumption was based on U.S. Treasury instruments with maturities that were consistent with the option's expected term. Starting January 1, 2016, the Company began using a different approach to estimate the expected term of its stock option awards, which involves calculating the average of—(1) its employees’ historical stock option exercise behavior, and (2) the weighted-average of the time-to-vesting and the total contractual life of the options. The Company applied this change in methodology prospectively and accounted for it as a change in accounting estimate. Warrants The Company accounts for warrants to purchase shares of its common stock as a liability at fair value on the balance sheet date because the Company may be obligated to redeem these warrants at some point in the future. The warrants are subject to remeasurement at each balance sheet date, with changes in fair value recognized as a gain or loss from the changes in fair value of the warrants in the statements of operations and comprehensive loss. Further adjustments resulting from changes in fair value are no longer required as the warrants were fully exercised in June 2018. Capitalized Software Held for Internal Use The Company capitalizes salaries and related costs of employees and consultants who devote time to the development of internal-use software development projects. Capitalization begins during the application development stage, once the preliminary project stage has been completed, which includes successful validation and approval from management. If a project constitutes an enhancement to previously developed software, the Company assesses whether the enhancement is significant and creates additional functionality to the software, thus qualifying the work incurred for capitalization. Once the project is available for general release, capitalization ceases and the Company estimates the useful life of the asset and begins amortization. The Company periodically assesses whether triggering events are present to review internal-use software for impairment. Changes in estimates related to internal-use software would increase or decrease operating expenses or amortization recorded during the reporting period. Refer to Property and Equipment, net under Note 6 for more detail regarding an impairment charge recorded to write off certain project development costs during the first quarter of 2018. The Company amortizes its internal-use software over the estimated useful lives of three years. The net book value of capitalized software held for internal use was $1.7 million and $2.6 million as of December 31, 2018 and 2017, respectively. Amortized expense for amounts previously capitalized for the years ended December 31, 2018, 2017 and 2016 was $1.3 million, $1.0 million and $0.6 million, respectively. Accumulated Other Comprehensive Loss Comprehensive loss and its components encompass all changes in equity other than those with stockholders, and include net loss, unrealized gains and losses on available-for-sale marketable securities. As of December 31, 2018, and 2017, accumulated other comprehensive loss consisted of $0.6 million and $0.8 million of unrealized losses on available-for-sale marketable securities. See Note 5 for additional disclosures related to change in net unrealized losses and reclassifications out of accumulated other comprehensive loss upon the sale of available-for-sale marketable securities. Property and Equipment Property and equipment, including purchased and internally developed software, are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, which are generally three to five years. Leasehold improvements are amortized using the straight-line method over the estimated useful lives of the assets or the remaining term of the lease, whichever is shorter. The Company periodically reviews the depreciable lives assigned to property and equipment placed in service and change the estimates of useful lives to reflect the results of such reviews. Impairment of Long-lived Assets The Company periodically evaluates its long-lived assets for indicators of possible impairment when events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. The Company then compares the carrying amounts of the assets with the future net undiscounted cash flows expected to be generated by such asset. Should an impairment exist, the impairment loss would be measured based on the excess carrying value of the asset over the asset’s fair value determined using discounted estimates of future cash flows. See Note 6 for more detail about assets impairment. Inventory Inventory is valued at the lower of the standard cost, which approximates actual cost, or market. Cost is determined using the first-in, first-out ("FIFO") method. Inventory consists entirely of supplies, which are consumed when providing its test reports, and therefore does not maintain any finished goods inventory. The Company enters into inventory purchases and commitments so that it can meet future delivery schedules based on forecasted demand for its tests. The Company recorded inventory obsolescence charges totaling $0.3 million, $0.5 million, and $2.1 million in the years ended December 31, 2018, 2017, and 2016, respectively. Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (the “FASB”) under its accounting standard codifications (“ASC”) or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed below, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption. Recently Adopted Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, which amends the existing accounting standards for revenue recognition. ASU 2014-09, which defines the core principles of Accounting Standards Codification Topic 606 (“ASC 606”), establishes principles for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. ASC 606 also impacts the accounting for costs incurred in obtaining a contract with a customer, provided that such costs are considered incremental and recoverable by the Company. Effective January 1, 2018, the Company adopted ASC 606 using the full retrospective approach. The Company revised the financial results in its statements of operations and comprehensive loss for the years ended December 31, 2017 and 2016, respectively, and balance sheet as of December 31, 2017, as if ASC 606 had been effective for those periods. The adoption of ASC 606 resulted in a cumulative-effect adjustment of approximately $41.7 million recorded retroactively to accumulated deficit as of December 31, 2015. The impact of adopting the new guidance on total revenues for the years ended December 31, 2017 and 2016 was a decrease of $1.3 million and $4.6 million, respectively. For financial statement disclosure purposes, the Company elected one of the practical expedients under ASC 606 to forego disclosures related to the allocation of consideration to the remaining performance obligations and the timing in which revenues will be recognized from such performance obligations. Upon the adoption of ASC 606, the Company revised the following selected amounts in its consolidated balance sheet from amounts previously reported: December 31, 2017 As Previously Adoption of Reported ASC 606 As Revised (in thousands) Accounts receivable, net of allowance $ 8,252 $ 35,837 $ 44,089 Other accrued liabilities 33,207 50 33,257 Accumulated deficit $ (482,162) $ 35,787 $ (446,375) Upon the adoption of ASC 606, the Company restated the following selected amounts in its consolidated statements of operations and comprehensive loss from amounts previously reported: Year ended December 31, 2017 As Previously Adoption of Reported ASC 606 As Revised (in thousands) Product revenues $ 205,489 $ (1,712) $ 203,777 Licensing and other revenues 5,450 398 5,848 Total revenues 210,939 (1,314) 209,625 Loss from operations (134,027) (1,314) (135,341) Net loss (136,314) (1,314) (137,628) Net loss per share: Basic $ (2.56) $ (0.02) $ (2.58) Diluted $ (2.56) $ (0.03) $ (2.59) Year ended December 31, 2016 As Previously Adoption of Reported ASC 606 As Revised (in thousands) Product revenues $ 213,968 $ (4,562) $ 209,406 Licensing and other revenues 3,106 — 3,106 Total revenues 217,074 (4,562) 212,512 Loss from operations (96,488) (4,562) (101,050) Net loss (95,765) (4,562) (100,327) Net loss per share: Basic $ (1.86) $ (0.09) $ (1.95) Diluted $ (1.86) $ (0.09) $ (1.95) The Company restated the following selected amounts in its consolidated statements of cash flows from amounts previously reported as a result of the adoption of ASC 606, as well as the adoption of ASU 2016-18 regarding the new financial statement presentation requirements for restricted cash: Year ended December 31, 2017 As Previously Adoption of Adoption of Reported ASU 2016-18 ASC 606 As Revised (in thousands) Operating activities: Net loss $ (136,314) $ — $ (1,314) $ (137,628) Changes in operating assets and liabilities: Accounts receivable 5,001 — 1,314 6,315 Net cash used in operating activities (96,792) (1,033) — (97,825) Cash, cash equivalents and restricted cash, beginning of period 15,256 1,434 — 16,690 Cash, cash equivalents and restricted cash, end of period $ 12,620 $ 401 $ — $ 13,021 Year ended December 31, 2016 As Previously Adoption of Adoption of Reported ASU 2016-18 ASC 606 As Revised (in thousands) Operating activities: Net loss $ (95,765) $ — $ (4,562) $ (100,327) Changes in operating assets and liabilities: Accounts receivable (8,518) — 4,562 (3,956) Net cash used in operating activities (73,902) (150) — (74,052) Cash, cash equivalents and restricted cash, beginning of period 28,947 1,584 — 30,531 Cash, cash equivalents and restricted cash, end of period $ 15,256 $ 1,434 $ — $ 16,690 In November 2016, the FASB issued Accounting Standards Update No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (“ASU 2016-18”). The new guidance requires restricted cash to be combined with cash and cash equivalents when reconciling the beginning and ending balances of cash on the statement of cash flows. Further, the new guidance requires the nature of the restrictions to be disclosed, as well as a reconciliation between the balance sheet and the statement of cash flows on how restricted and unrestricted cash are segregated. The Company adopted this new guidance beginning January 1, 2018 and retroactively adjusted the statements of cash flows for the years ended December 31, 2017 and 2016 to show the combined result of cash and cash equivalents and restricted cash. In August 2016, the FASB issued Accounting Standards Update No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (A Consensus of the Emerging Issues Task Force) (“ASU 2016-15”) . The purpose of ASU 2016-15 is to limit diversity in the classification of certain transactions in the statement of cash flows. Such transactions include (1) debt prepayment or debt extinguishment costs, (2) settlement of zero-coupon bonds, (3) contingent consideration payments made after a business combination, (4) proceeds from insurance claims settlement, (5) proceeds from settlement of life insurance policies, and (6) distributions of equity method investments. The Company adopted this new guidance beginning January 1, 2018, which did not result in a material impact on its financial statements as none of the transactions described above occurred during the year ended December 31, 2018. In May 2017, the FASB issued Accounting Standards Update No. 2017-09 (“ASU 2017-09”), Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting . The purpose of this ASU is to clarify when to account for a change to the terms or conditions of a share-based payment award as a modification. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions, or the classification of the award (as equity or liability) changes as a result of the change in terms or conditions. The Company adopted this new guidance beginning January 1, 2018, and the impact on its financial statements was not material upon adoption. New Accounting Pronouncements Not Yet Adopted In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (“ASU 2016-02”). ASU 2016-02 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. In July 2018, the FASB also issued ASU 2018-11, Leases (Topic 842): Targeted Improvements , which provides an alternative by allowing a cumulative-effect adjustment to be recorded in the opening retained earnings balance as of January 1, 2019 instead of the earliest period presented, and can be adopted concurrently with ASU 2016-02. These two accounting standard updates are collectively known as ASC 842. In preparation for a proper transition to ASC 842, the Company has designated a project implementation team to assess the scope of the accounting and explore opportunities to reduce the extent and complexity of such work by utilizing certain practical expedients under the new guidance. Upon the election of such practical expedients, the Company will be allowed to forego reassessment of the lease classification of an expired or existing lease agreement, whether an expired or existing agreement contains a lease, exclude any lease agreement with a term less than 12 months from the transition, and record a cumulative-effect adjustment as of the effective date of January 1, 2019 instead of the earliest period presented in the financial statements. The Company is in the process of finalizing its analysis and expects the amounts to be recorded for its right-of-use assets and corresponding lease liabilities to be material upon the adoption of ASC 842 using the modified retrospective approach. In June 2016, the FASB issued Accounting Standards Update No. 2016-13, Financial Instruments—Credit Losses: Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 requires measurement and recognition of expected credit losses for financial assets by requiring an allowance to be recorded as an offset to the amortized cost of such assets. For available-for-sale debt securities, expected credit losses should be estimated when the fair value of the debt securities is below their associated amortized costs. ASU 2016-13 will become effective for the Company in the first quarter of 2020, with early adoption permitted beginning the first quarter of 2019. The modified retrospective approach should be applied upon adoption of this new guidance. The Company is currently evaluating the impact of adopting ASU 2016-13 on its financial statements. In February 2018, the FASB issued Accounting Standards Update No. 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (“ASU 2018-02”) . This new guidance was established as a result of the Tax Cuts and Jobs Act passed in December 2017, which provides an opportunity for entities to reclassify residual income tax effects from accumulated other comprehensive income to retained earnings due to the reduction of the corporate income tax rate. The new guidance will be effective in the first quarter of 2019, and interim periods within that year, with early adoption permitted. The Company will have the option to apply this new guidance using either the full retrospective approach or to record the reclassifications as of the beginning date in the period of adoption. The Company does not expect the impact of adopting ASU 2018-02 to be material to its financial statements given that the deferred tax assets are fully reserved by a valuation allowance as of December 31, 2018. In June 2018, the FASB issued Accounting Standards Update No. 2018-07, Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”). ASU 2018-07 is intended to reduce the cost and complexity and to improve financial reporting for nonemployee share-based payments. ASU 2018-07 expands the scope of Topic 718, Compensation—Stock Compensation (which currently only includes share-based payments to employees) to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially al

Revenue Recognition

Revenue Recognition	12 Months Ended
	Dec. 31, 2018
Revenue Recognition
Revenue Recognition	3. Revenue Recognition The Company recognizes revenues when, or as, performance obligations in the contracts are satisfied, in the amount reflecting the expected consideration to be received from the goods or services transferred to the customers. Product Revenues Product revenues are derived from contracts with insurance carriers, laboratory partners and patients in connection with sales of prenatal genetic tests. The majority of the Company’s revenues is derived from Panorama NIPT, HCS (as defined in Note 1), and to a lesser extent, other genetic tests. The Company enters into contracts with insurance carriers with primarily payment terms related to tests provided to the patients who have health insurance coverage. Insurance carriers are considered as third-party payers on behalf of the patients, and the patients are considered as the customers who receive genetic test services. Tests may be billed to insurance carriers, patients, or a combination of insurance carriers and patients. Further, the Company sells tests to a number of domestic and international laboratory partners and identifies the laboratory partners as customers provided that there is a test services agreement between the two parties. A performance obligation represents a promise in a contract to transfer a distinct good or service to a customer, which represents a unit of accounting in accordance with ASC 606. A portion of the consideration should be allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The Company evaluates its contracts with insurance carriers, laboratory partners and patients and identifies a single performance obligation in those contracts, which is the delivery of the test results. The total consideration which the Company expects to collect in exchange for the Company’s products is an estimate and may be fixed or variable. Consideration includes reimbursement from both patients and insurance carriers, adjusted for variable consideration related to disallowed cases, discounts, refunds and doubtful accounts, and is estimated using the expected value approach. For insurance carriers with similar reimbursement characteristics, the Company uses a portfolio of relevant historical data to estimate variable consideration and total collections for the Company’s products. The Company constrains the estimated variable consideration when it assesses it is probable that a significant reversal in the amount of cumulative revenue recognized may occur in future periods. The consideration expected from laboratory partners usually includes a fixed amount, but it can be variable depending on the volume of tests performed, and the Company determines the variable consideration using the expected value approach. For insurance carriers, laboratory partners and patients, the Company allocates the total consideration to a single performance obligation, which is the delivery of the test results to the customers. When assessing the total consideration for insurance carriers and patients, a certain percentage of revenues is further constrained for estimated refunds. The Company generally bills an insurance carrier, a laboratory partner or a patient upon delivery of test results. The Company also bills patients directly for out-of-pocket costs involving co-pays and deductibles that they are responsible for. Tests billed to insurance carriers and directly to patients usually take an average of nine to twelve months to collect the payments, and for tests billed to laboratory distribution partners, the average collection cycle takes approximately two to three months. At times, the Company may or may not get reimbursed for the full amount billed. Further, the Company may not get reimbursed at all for tests performed if such tests are not covered under the insurance carrier’s reimbursement policies or the Company is not a qualified provider to the insurance carrier, or if the tests were not previously authorized. Product revenue is recognized in an amount that equals to the total consideration (as described above) at a point in time when the test results are delivered. The Company reserves certain amounts in other accrued liabilities on the balance sheet in anticipation of requests for refunds of payments previously made by insurance carriers, which are accounted for as reductions in product revenues in the statement of operations and comprehensive loss. During the years ended December 31, 2018 and 2017, $3.3 million and $4.9 million, respectively, were released from amounts previously held in reserves in other accrued liabilities and recognized as product revenue. There were no amounts released from the reserves during the year ended December 31, 2016. Licensing and Other Revenues The Company recognizes licensing revenues from its cloud-based distribution service offering, Constellation, by granting licenses to its licensees to use certain of the Company’s proprietary intellectual properties and cloud-based software. The Company also recognizes revenues from Evercord for the collection and storage of newborn cord blood and cord tissue units. Constellation The laboratory partners with which the Company enters into a licensing arrangement represent the licensees and are identified as customers. The licensees do not have the right to possess the Company’s software, but rather receive the software as a service. These arrangements often include: (i) the delivery of the software as a service, (ii) the necessary support and training, and (iii) the reagent kits (“IVD kits”) to be consumed as tests are processed. The Company does not consider the software as a service, the support and training as being distinct in the context of such arrangements, and therefore they are combined as a single performance obligation. The software, support and training are delivered simultaneously to the licensees over the term of the arrangement. The Company provides IVD kits that are customized for its licensees to process tests using its cloud-based software. IVD kits revenues are recognized based on their standalone selling price at a point in time upon delivery to the licensees and expiration of their right of return. The Company bills the majority of licensees, who process the tests in their laboratories, a fixed price for each test processed. Licensing revenues are recognized as the performance obligations are satisfied over time and reported in licensing and other revenues in the statements of operations and comprehensive loss. Evercord The Company recognizes revenues from Evercord for the collection and storage of newborn cord blood and cord tissue units. The patient enters into an enrollment agreement with the Company. According to the agreement, there are two performance obligations: (i) the provision of a collection kit and the processing of newborn cord blood and cord tissue units, which are considered delivered at the beginning of the process (the “processing services”), and (ii) the storage of the cord blood and cord tissue units (the “storage services”), for either an annual fee or a prepayment covering an extended period or the lifetime of the newborn donor. The Company offers its processing services together with storage services, and each of them is capable of being distinct, and is distinct in the context of the contract, and therefore, represents separate performance obligations. Evercord customers may pay for both processing and storage services over a period of six, 12, or 18 months. The transaction price for the processing and storage services is calculated as the stated contract price, adjusted for discounts, refunds, and significant financing components. The Company determines estimated standalone selling prices based on transaction price and observable prices in the market for both the processing and storage services. The total consideration is allocated between the processing services and storage services based on their estimated standalone selling prices. Upon the completion of the processing services, the Company issues a certificate of preservation indicating that the cord blood and cord tissue units are ready for storage, and processing revenues are recognized at this particular point in time. Storage revenues are recognized over time, which is the applicable storage period. The Company believes the methodology of recognizing storage revenues over time meaningfully depicts the timing of storage services delivered to customers as it exerts the necessary efforts to deliver such services equally over time. Evercord revenues are reported in licensing and other revenues in the statements of operations and comprehensive loss. Qiagen In March 2018, the Company entered into a License, Development and Distribution Agreement (“the Qiagen Agreement”) with Qiagen under which the Company granted Qiagen a license to develop, manufacture, distribute and commercialize NGS-based genetic testing assays and sequencing systems utilizing such assays, which incorporate the Company’s proprietary technology. According to the terms of the agreement, the Company is initially entitled to receive an upfront license fee and prepaid royalties totaling $40.0 million. All or a portion of the prepaid royalties are refundable in limited circumstances. In addition, the Company is entitled to potential milestone payments from Qiagen upon the achievement of certain volume, regulatory and commercial milestones, and tiered royalties. The Qiagen Agreement has a term of 10 years and expires in March 2028, and it may be terminated earlier in certain circumstances. Upon termination of the Qiagen Agreement, the license granted to Qiagen will also terminate, except in certain limited circumstances. The Company provided to Qiagen standard indemnification protections, which is part of an assurance that the license meets the contract’s specifications and is not an obligation to provide goods or services. The Company identified the following goods and services in the agreement that it concluded were distinct performance obligations: Technology license. The Company granted the right to Qiagen to use its proprietary intellectual properties (“technology license”) to develop, manufacture, distribute and commercialize genetic testing assays and sequencing systems in certain countries. The technology license was transferred to Qiagen at the inception of this agreement when the license became effective and the technology transfer was completed. Development services. The Company is responsible for providing certain support services to assist Qiagen in its design and development of the genetic test assays. Market development support. The Company is required to support Qiagen’s market development for the genetic testing assays. Option to expand commercialization to another country. The Company has provided an option to Qiagen to expand the commercialization of its genetic testing assays to another country following all of the necessary regulatory approvals. The initial transaction price was estimated to be $15.0 million based on the most likely amount approach, which was comprised of the upfront non-refundable fee and a payment associated with the initial milestone under the agreement. The remaining milestone and prepaid royalty amounts were not included in the transaction price due to the uncertainties of research and development and the potential for prepaid royalty refund, as it is not currently probable that the associated revenue, if recognized, would not be reversed later. Royalties, including prepaid royalties, will generally not be recognized until earned. The allocation of the transaction price was performed based on standalone selling prices, which are based on estimated amounts that the Company would charge for a performance obligation if it were sold separately. Future variable consideration such as milestones and royalties is considered associated with the technology license performance obligation. The amounts included in the initial transaction price were allocated to the remaining value of the technology license, as well as development services, market development support and the option to expand commercialization using the relative standalone selling price approach. The amount initially allocated to the technology license was $5.5 million. For the year ended December 31, 2018, the Company recognized revenue of approximately $5.8 million related to support services provided and the delivery of its technology license to Qiagen. In accordance with ASC 340-40, any incremental costs incurred to obtain a contract with a customer are required to be capitalized and amortized over the period in which the goods and services are transferred to the customer. The Company has elected to apply a practical expedient under ASC 340-40 to recognize the incremental costs of obtaining a contract as an expense when incurred provided that the amortization period of such costs, if capitalized, is one year or less. Disaggregation of Revenues The primary source of the Company’s revenues relates to the sale of prenatal genetic tests. The Company also recognizes licensing revenues from its cloud-based software platform, Constellation and other revenues. The following table shows disaggregation of revenues by types of products and services, with sales of genetic tests further disaggregated by test families: Year Ended December 31, 2018 2017 2016 (Amounts in thousands) (As Revised) (As Revised) Sales of genetic tests Panorama NIPT $ 140,932 $ 128,896 $ 140,582 HCS 87,171 63,467 56,417 Other genetic tests 12,263 11,414 12,407 Product revenues 240,366 203,777 209,406 Licensing and other Constellation 4,844 4,229 3,106 Qiagen 5,794 — — Other 6,650 1,619 — Licensing and other revenues 17,288 5,848 3,106 Total revenues $ 257,654 $ 209,625 $ 212,512 The Company measures its performance results primarily based on revenues recognized from the three categories described below. The following table shows disaggregation of revenues by payer types: Year Ended December 31, 2018 2017 2016 (Amounts in thousands) (As Revised) (As Revised) Insurance carriers $ 193,895 $ 163,861 $ 157,570 Laboratory partners 44,062 36,001 46,129 Patients 19,697 9,763 8,813 Total revenues $ 257,654 $ 209,625 $ 212,512 The following table presents total revenues by geographic area based on the location of the Company’s payers: Year ended December 31, 2018 2017 2016 (Amounts in thousands) (As Revised) (As Revised) United States $ 225,931 $ 185,533 $ 188,492 Americas, excluding U.S. 3,472 3,028 2,562 Europe, Middle East, India, Africa 20,866 13,998 14,256 Other 7,385 7,066 7,202 Total $ 257,654 $ 209,625 $ 212,512 The Company recognizes revenue from billings to insurance carriers and patients based on estimates of the amount that will ultimately be realized (“expected consideration”). The expected consideration estimated for genetic test services is based on many factors such as length of payer relationship, historical collection trends, changes in contract provisions and insurance reimbursement policies. Cash collections for certain tests delivered may differ from the expected consideration originally estimated. During the year ended December 31, 2018, the Company’s collections substantially improved. As a result of this, the Company updated its estimate of the amounts to be recognized for previously delivered tests which resulted in an additional $10.2 million of revenue for the year ended December 31, 2018. These changes in estimates decreased the Company’s loss from operations by $10.2 million and decreased basic and diluted net loss per share by approximately $0.18 for the year ended December 31, 2018. The following table summarizes the Company’s beginning and ending balances of accounts receivable and deferred revenues: Balance at Balance at December 31, December 31, 2018 2017 (Amounts in thousands) (As Revised) Assets: Accounts receivable $ 62,223 $ 44,089 Liabilities: Deferred revenue, current portion $ 4,131 $ 1,420 Deferred revenue, long-term portion 40,058 — Total deferred revenues $ 44,189 $ 1,420 Accounts receivable included trade receivables, as well as receivables from Evercord customers who selected certain prepayment plans for storage services to be delivered over the duration of lifetime or 18 years. Evercord customers have the option to either prepay for storage services in full upfront or finance their prepayment plans over the period of six, 12, or 18 months. Generally, prepayments collected by the Company for the lifetime or 18-year storage plans are non-refundable unless the storage service agreement is terminated. However, Evercord customers who choose the financing option will be obligated to make the remainder of their payments pursuant to the terms of the financing plan, and this represents the Company’s unconditional right to the consideration from its customers. Total receivables pertaining to the financing options was $3.9 million, of which $3.4 million was included in accounts receivable and $0.5 million was related to financing over the period greater than 12 month. As of December 31, 2018, accounts receivable totaled $62.2 million. The Company reclassified $0.5 million to other noncurrent assets in its consolidated balance sheet as of December 31, 2018. The following table shows the changes in the balance of deferred revenues during the period: Deferred Revenues (in thousands) Balance at December 31, 2017 $ 1,420 Increase in deferred revenues 43,481 Revenue recognized during the period that was included in (712) Balance at December 31, 2018 $ 44,189 During the year ended December 31, 2018, revenue recognized that was included in the deferred revenue balance at the beginning of the period totaled $0.7 million, of which $0.6 million was related to genetic testing services and the provision of IVD kits and $0.1 million pertained to undelivered Evercord storage services over the remaining contractual life of such services. As of December 31, 2018, total deferred revenues were $44.2 million, which were comprised of the current and long-term portions of $4.1 million and $40.1 million, respectively. The current portion was comprised of $2.1 million relating to the provision of IVD kits, genetic testing services and Evercord storage services that will be fulfilled within the next 12 months, and $2.0 million of unsatisfied performance obligations from the Qiagen Agreement. The long-term portion included $2.9 million of Evercord storage services to be delivered by the Company over the remaining contractual life of such services, and $37.2 million resulting from the remaining performance obligations from the Qiagen Agreement. Such remaining performance obligations were comprised of development services and market development support, for which revenue will be recognized over time based on the value of services; and the option for Qiagen to expand its commercialization to another country, with revenue recognized at a point in time when such option is exercised or expires. The Company expects to recognize $9.2 million of the amounts reported as long-term deferred revenue as each remaining performance obligation is satisfied.

Fair Value Measurements

Fair Value Measurements	12 Months Ended
	Dec. 31, 2018
Fair Value Measurements
Fair Value Measurements	4. Fair Value Measurements The Company's financial assets and liabilities carried at fair value are comprised of investment assets that include money market and investments, and a liability for common stock warrants. The fair value accounting guidance requires that assets and liabilities be carried at fair value and classified in one of the following three categories: Level I: Quoted prices in active markets for identical assets and liabilities that the Company has the ability to access Level II: Observable market‑based inputs or unobservable inputs that are corroborated by market data, such as quoted prices, interest rates, and yield curves Level III: Inputs that are unobservable data points that are not corroborated by market data. This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. There were no transfers between Level I, Level II and Level III during the periods presented. Assets and Liabilities That Are Measured at Fair Value on a Recurring Basis The following table represents the fair value hierarchy for the Company’s financial assets and financial liabilities measured at fair value on a recurring basis: December 31, 2018 December 31, 2017 Level I Level II Level III Total Level I Level II Level III Total (in thousands) Financial Assets: Money market deposits $ 26,539 $ — $ — $ 26,539 $ 3,477 $ — $ — $ 3,477 U.S. Treasury securities 75,685 — — 75,685 67,026 — — 67,026 U.S. agency securities — 12,891 — 12,891 — 27,072 — 27,072 Municipal securities — 18,885 — 18,885 — 12,149 — 12,149 Total financial assets $ 102,224 $ 31,776 $ — $ 134,000 $ 70,503 $ 39,221 $ — $ 109,724 Current Liabilities: Warrants $ $ — $ — $ — $ — $ — $ 2,644 $ 2,644 Total financial liabilities $ — $ — $ — $ — $ — $ — $ 2,644 $ 2,644 The Company's warrants to purchase common stock are valued using Level III inputs; the Company used inputs from a Black-Scholes model with market volatility that is determined for comparable companies in the same business sector. The carrying amounts of cash, accounts receivable, and accounts payable approximate their fair value and are excluded from the table above. In April 2013, the Company entered into a senior secured term loan with a third-party lender, which consisted of a credit agreement, royalty agreement, warrants and loan commitment. Based upon the Company’s evaluation, the senior secured term loan constituted a liability with embedded derivative features that was accounted for separately as mark-to-market instruments. In addition, adjustments to the embedded royalty feature were recorded as interest expense as they occurred, offset to the carrying amount of the debt (with the eventually cash outlay to settle such amounts recorded against the carrying amount of the debt). Based on the Company’s evaluation, it was determined that the warrants granted are detachable and therefore are a stand-alone component of the senior secured term loan to be fair valued using Level III inputs as a separate derivative. In October 2015, the Company repaid the entire borrowings under the senior secured term loan. The fair value of both the senior secured term loan and warrants was remeasured at the end of each reporting period, with the change in fair value for the term loan recorded as interest benefit from changes in the fair value of long-term debt and the remeasurement gain or loss on the warrants recorded within interest and other income (expense), net in the statements of operations and comprehensive loss. The following table provides a roll forward of the fair value, as determined by Level III inputs, of the warrants for the years ended December 31, 2018 and 2017: Warrants 2018 2017 (in thousands) Beginning balance $ 2,644 $ 3,792 Warrants exercised (6,762) — Change in fair value 4,118 (1,148) Ending balance $ — $ 2,644 Warrants The significant unobservable inputs used in the fair value of warrants are derived from the Company's common stock valuation that is based on inputs from a Black-Scholes option-pricing model. Since all of the warrants were exercised on June 26, 2018, the fair value of the warrant liability was remeasured up to that date, with valuation assumptions such as the expected term, risk-free interest rate, and market volatility based on comparable companies in the same business sector determined at the point of the exercise of warrants. The inherent risk in the market volatility is the selection of companies with similar business attributes to the Company. Determining the fair value of warrants requires the application of judgment on the associated valuation assumptions described above. The assumptions used in calculating the fair value of warrants represent the Company’s estimates, but these estimates involve inherent uncertainties. As a result, if factors change and the Company uses different assumptions, the fair value of warrants could be significantly different in the future.

Financial Instruments

Financial Instruments	12 Months Ended
	Dec. 31, 2018
Financial Instruments
Financial Instruments	5. Financial Instruments The Company elected to invest a portion of its cash assets in conservative, income earning, liquid investments. Cash equivalents and investments, all of which are classified as available-for-sale securities, consisted of the following: December 31, 2018 December 31, 2017 Amortized Gross Gross Estimated Fair Amortized Gross Gross Estimated Fair (in thousands) Money market deposits $ 26,539 $ — $ — $ 26,539 $ 3,477 $ — $ — $ 3,477 U.S. Treasury securities 76,061 29 (405) 75,685 67,480 10 (464) 67,026 U.S. agency securities 13,017 — (126) 12,891 27,293 — (221) 27,072 Municipal securities 18,935 7 (57) 18,885 12,240 — (91) 12,149 Total $ 134,552 $ 36 $ (588) $ 134,000 $ 110,490 $ 10 $ (776) $ 109,724 Classified as: Cash equivalents $ 26,539 $ 3,477 Short-term investments 107,461 106,247 Total $ 134,000 $ 109,724 The Company invests in U.S. Treasuries, U.S. agency and high quality municipal bonds which mature at par and are all paying their coupons on schedule. Thus, the Company has determined there is currently no other than temporary impairment of its investments, and will continue to recognize unrealized losses in other comprehensive income. As of December 31, 2018, the Company has 16 investments in an unrealized loss position in its portfolio. During the years ended December 31, 2018 and 2017, the amount of gross realized gains and realized losses upon sales of investments were insignificant, and during the year ended December 31, 2016, sales of investments resulted in gross realized gains of $0.2 million and insignificant gross realized losses. Realized gains and losses are reported in interest and other (expense) income, net in the statements of operations and comprehensive loss. The following table shows the change in the net unrealized positions of the available-for-sale securities and reclassifications from accumulated other comprehensive loss upon the sale of those securities: December 31, 2018 2017 (in thousands) Balance at beginning of year $ (766) $ (725) Net unrealized gains (losses) on available-for-sale securities, net of tax 171 (105) Reclassifications of losses realized from sale of available-for-sale securities 43 64 Increase (decrease) in other comprehensive loss 214 (41) Balance at end of year $ (552) $ (766) During the years ended December 31, 2018, 2017 and 2016, the Company earned interest income of $1.8 million, $1.2 million and $1.5 million, respectively, from its investment portfolio. The following table summarizes the Company’s portfolio of available-for-sale securities by contractual maturity as of December 31, 2018: December 31, 2018 Amortized Fair (in thousands) Less than one year $ 64,477 $ 64,276 Greater than one year but less than five years 43,536 43,185 Total $ 108,013 $ 107,461

Balance Sheet Components

Balance Sheet Components	12 Months Ended
	Dec. 31, 2018
Balance Sheet Components
Balance Sheet Components	6. Balance Sheet Components Allowance for Doubtful Accounts The following table presents a reconciliation of the allowance for doubtful accounts: December 31, December 31, December 31, 2018 2017 2016 (in thousands) Beginning balance $ 2,000 $ 1,890 $ 971 Provision for estimated bad debts (41) 143 984 Write offs (171) (33) (65) Ending balance $ 1,788 $ 2,000 $ 1,890 Property and Equipment, net The Company’s property and equipment consisted of the following: December 31, December 31, Useful Life 2018 2017 (in thousands) Machinery and equipment 3-5 years $ 35,400 $ 31,825 Furniture and fixtures 3 years 1,319 1,216 Computer equipment 3 years 2,117 1,958 Capitalized software held for internal use 3 years 4,868 4,465 Leasehold improvements Life of lease 10,916 10,691 Construction-in-process 4,013 6,497 58,633 56,652 Less: Accumulated depreciation and amortization (34,297) (26,985) Total Property and Equipment, net $ 24,336 $ 29,667 All of the Company’s long-lived assets are located in the United States. During the year ended December 31, 2018, an asset impairment charge of $1.5 million was recorded in research and development expenses in the statements of operations and comprehensive loss. This charge was recorded to write off certain project development costs that were previously capitalized. During the year ended December 31, 2017, the Company recorded asset impairment charges totaling $0.6 million as a result of fully decommissioning its previous generation of sequencing and automation equipment in January 2017. These charges were recorded in cost of product revenues in the statements of operations and comprehensive loss. During the year ended December 31, 2016, the Company recorded asset impairment charges totaling $2.1 million in the statements of operations and comprehensive loss, of which $1.9 million was recorded in cost of product revenues and $0.2 million was included in general and administrative expenses, following its impairment analysis on its previous generation of sequencing and automation equipment whose service lives were determined to be significantly shorter than initially expected. These charges also included the write-off of $0.3 million unamortized maintenance service contract prepayments related to the impaired equipment described above. The Company expected to phase out the equipment in the first quarter of 2017 as the Company began its transition to the next generation of sequencing and automation equipment to help streamline its production workflows. Other Assets In April 2016, the Company entered into a four-year agreement with an insurance carrier whereby in return for partial exclusivity and the right to pricing benefits the Company paid total consideration of $3.2 million. The total consideration was paid in the third quarter of 2016. As of December 31, 2018 and 2017, $1.0 million and $1.8 million in deferred costs were included in other noncurrent assets. The deferred costs are being amortized ratably over the four-year term of the agreement. During the years ended December 31, 2018 and 2017, amortization of such costs totaling $0.8 million was recorded for each of the two years as a reduction of product revenues in the statements of operations and comprehensive loss. In August 2017, the Company entered into the 2017 Term Loan agreement with OrbiMed and issued 300,000 shares of its common stock in exchange for OrbiMed’s initial and remaining funding commitments (as described in Note 9). The Company also paid legal fees totaling $0.3 million in connection with this term loan. Total debt issuance costs of $2.7 million is accounted for as a debt discount. For financial statement presentation purposes, the Company has classified $2.0 million of the debt discount as a direct reduction from the outstanding debt balance, while $0.7 million of such remains in other noncurrent assets for the unused borrowing capacity of $50.0 million. The debt discount is being amortized on a straight-line basis over the term of the loan. For the year ended December 31, 2018, amortization of debt discount related to the unused borrowing capacity was $0.1 million. Amortization of debt discount for the unused borrowing capacity was insignificant in the year ended December 31, 2017. As of December 31, 2018, the unamortized portion of the debt discount remained at $0.6 million. As of December 31, 2018, other assets also included receivables from Evercord customers who selected the financing option for their prepayment plans (as described in Note 3). Total receivables associated with the financing option over the period greater than 12 months were $0.5 million. Accrued Compensation The Company’s accrued compensation consisted of the following: December 31, December 31, 2018 2017 (in thousands) Accrued paid time off $ 1,825 $ 1,806 Accrued commissions 4,492 3,558 Accrued bonuses 3,757 2,063 Other accrued compensation 2,594 2,172 Total accrued compensation $ 12,668 $ 9,599 Other Accrued Liabilities The Company’s other accrued liabilities consisted of the following: December 31, December 31, 2018 2017 (Amounts in thousands) (As Revised) Settlement accrued for reimbursement related claims $ 1,378 $ 10,062 Reserves for refunds to insurance carriers 10,012 6,794 Accrued charges for outsourced testing 5,001 6,566 Testing and laboratory materials from suppliers 2,742 1,367 Marketing and corporate affairs 1,306 1,456 Legal, audit and consulting fees 1,058 206 Accrued shipping charges 852 198 Sales tax payable 1,255 504 Accrued specimen service fees 1,378 683 Accrued rent 903 856 Clinical trials and studies 1,694 483 Other accrued expenses 4,863 4,082 Total other accrued liabilities $ 32,442 $ 33,257 As of December 31, 2017, the Company accrued a total of $11.4 million for amounts due under a settlement agreement related to reimbursement related claims, of which $10.1 million was the current portion and $1.3 million due after 12 months was recorded in other long-term liabilities. The Company made approximately $5.3 million of settlement prepayments at the end of the first quarter of 2018, and the remaining payments were allowed to be made in subsequent quarterly installments with interest accrued as described in Note 7 under Legal Proceedings . Interest accrued was $0.2 million for the year ended December 31, 2018, which has been paid together with a total of three quarterly installments amounting to $4.2 million. Additionally, a separate payment of $0.8 million was made in connection with the settlement. As of December 31, 2018, the last quarterly installment of $1.4 million remained in other accrued liabilities. Reserves for refunds to insurance carriers include overpayments from and amounts to be refunded to insurance carriers, and additional amounts that the Company estimates as reserves for potential refund requests during the period. When the Company releases these previously reserved amounts, they are recognized as product revenues in the statements of operations and comprehensive loss. As of December 31, 2017, reserves relating to payers were $6.8 million. During the year ended December 31, 2018, the Company reserved an additional $10.3 million, and amounts previously held in reserves relating to payers totaling $3.3 million were released. Remaining reserves relating to payers in other accrued liabilities were $10.0 million as of December 31, 2018.

Commitments and Contingencies

Commitments and Contingencies	12 Months Ended
	Dec. 31, 2018
Commitments and Contingencies
Commitments and Contingencies	7. Commitments and Contingencies Operating Leases As of December 31, 2018, the Company leases office facilities under non‑cancelable operating lease agreements. The Company currently occupies approximately 136,000 square feet of laboratory and office space at its San Carlos, California corporate headquarters pursuant to a lease that it directly entered into with its landlord in October 2016. This lease covers two office spaces (the “First Space and the “Second Space”). The First Space covers approximately 88,000 square feet at a base rent of $319,095. The Second Space covers approximately 48,000 square feet at a base rent of $190,424 per month. The Company paid a security deposit totaling $0.7 million on this lease. The term of this lease is approximately 84 months and expires in October 2023. In March 2018, the Company entered into a lease for its cord blood tissue storage facility in Tukwila, Washington that covers approximately 10,000 square feet. The lease term of this facility began in June 2018 with rent payment commencing in August 2018 at $11,900 per month, subject to an annual increase of approximately 3%. The lease term is 62 months expiring in July 2023. In September 2015, the Company’s subsidiary entered into a long-term lease agreement for laboratory and office space totaling approximately 94,000 square feet in Austin, Texas. The lease term is 132 months beginning in December 2015 and expiring in November 2026 with monthly payments beginning in December 2016, increasing from $0.1 million to $0.2 million. Pursuant to the terms of the lease, the subsidiary paid a security deposit of $0.4 million, and the landlord allotted the subsidiary an allowance for leasehold improvements of up to $7.8 million. The Company was reimbursed by the landlord the full amount of the allowance in 2017. The future annual minimum lease payments under all non-cancelable operating leases as of December 31, 2018 are as follows: Operating Leases (in thousands) Year ending December 31: 2019 $ 8,588 2020 8,825 2021 9,067 2022 9,319 2023 7,702 2024 and thereafter 7,130 Total future minimum lease payments $ 50,631 Rent expense for the years ended December 31, 2018, 2017 and 2016 was $7.4 million, $7.2 million and $5.4 million, respectively. The Company is also required to pay its share of facility operating expenses with respect to the facilities in which it operates. Legal Proceedings From time to time, the Company is involved in disputes, litigation, and other legal actions. The Company is aggressively pursuing its current litigation matters, and while there can be no assurances and the outcome of these matters is currently not determinable, the Company currently believes that there are no existing claims or proceedings that are likely to have a material adverse effect on its financial position. There are many uncertainties associated with any litigation and these actions or other third-party claims against the Company may cause the Company to incur costly litigation and/or substantial settlement charges. In addition, the resolution of any intellectual property litigation may require the Company to make royalty payments, which could adversely affect gross margins in future periods. If this were to occur, the Company's business, financial condition, results of operations, and cash flows could be adversely affected. The actual liability in any such matters may be materially different from the Company's estimates, if any, which could result in the need to record or adjust a liability and record additional expenses. During the periods presented, the Company has not recorded any accrual for loss contingencies associated with such legal proceedings, determined that an unfavorable outcome is probable or reasonably possible, or determined that the amount or range of any possible loss is reasonably estimable, except for the amount accrued in connection with the settlement agreement with the United States Department of Justice described below. On March 16, 2018, a lawsuit (the ’831 lawsuit) against the Company was filed in the United States District Court for the Northern District of California by Illumina, Inc., or Illumina, alleging that the Company’s Panorama test infringes certain claims of U.S. Patent No. 9,493,831 (the ‘831 patent). Among other relief, the complaint seeks damages or other monetary relief including costs and pre- and post-judgment interest, treble damages, injunctive relief, attorneys’ fees and costs. On June 29, 2018, the Company filed a petition for inter partes review to challenge the validity of the ‘831 patent with the Patent Trial and Appeal Board of the United States Patent Office, or PTAB, which petition was not instituted. On August 16, 2018, the Company filed a patent infringement action in the United States District Court for the Northern District of California against Illumina, alleging that certain of Illumina’s tests infringe on the Company’s U.S. Patent No. 8,682,592 (the ’592 patent). Among other relief, Natera seeks damages or other monetary relief including costs and pre- and post-judgment interest, treble damages, injunctive relief, attorneys’ fees and costs. On January 16, 2019, the United States District Court for the Northern District of California held a claim construction hearing, and on January 30, 2019, issued an order construing certain claims. The Company intends to vigorously defend against the claims in the ‘831 lawsuit and assert its own claims with respect to the ‘592 patent, but cannot provide any assurance as to the ultimate outcome of either matter or that an adverse resolution of either lawsuit would not have a material adverse effect on its financial condition and results of operations. The Company is unable to predict the outcome and is unable to make a meaningful estimate of the amount or range of loss, if any, that could result from any unfavorable outcome. On each of February 17, 2016, March 10, 2016, March 28, 2016 and April 4, 2016, purported class action lawsuits were filed in the Superior Court of the State of California for the County of San Mateo (the “San Mateo Superior Court”), against Natera, its directors, certain of its officers and 5% stockholders and their affiliates, and each of the underwriters of the Company’s July 1, 2015 initial public offering (the “IPO”). The complaints assert claims under Sections 11, 12(a)(2) and 15 of the Securities Act of 1933, as amended. The complaints allege, among other things, that the Registration Statement and Prospectus for the Company’s IPO contained materially false or misleading statements, and/or omitted material information that was required to be disclosed, about the Company’s business and prospects. Among other relief, the complaints seek class certification, unspecified compensatory damages, rescission, attorneys' fees, and costs. The Company removed these actions to the United States District Court for the Northern District of California, and the actions were subsequently remanded back to the San Mateo Superior Court. The Company has appealed the remand and discovery has been stayed, or held, pending the appeal. The Company also filed a demurrer, or a request for dismissal as a matter of law, in the San Mateo Superior Court, which was granted on October 23, 2017. The San Mateo Superior Court demurred the claims under Sections 12(a)(2) and 15 of the Securities Act of 1933, as amended, without leave to re-file. The San Mateo Superior Court granted the demurrer as to Section 11 of the Act with leave to re-file. Plaintiffs refiled an amended complaint on November 22, 2017. The Company filed a motion for judgment on the pleadings under the amended complaint on January 25, 2018, which the plaintiffs opposed. Hearings on the motion were held in May and July of 2018. On August 7, 2018 the judge granted the Company’s motion for judgment on the pleadings, without leave to amend, and ordered that judgment be entered in favor of the defendants. Plaintiffs filed a notice of appeal on or about October 18, 2018. The Company intends to continue to defend the matter vigorously, but cannot provide any assurance as to the ultimate outcome or that an adverse resolution would not have a material adverse effect on its financial condition and results of operations. The Company is unable to predict the ultimate outcome and is unable to make a meaningful estimate of the amount or range of loss, if any, that could result from any unfavorable outcome. On January 22, 2019, a lawsuit was filed against the Company in the Superior Court of the State of California for the County of San Mateo, by a patient alleging various claims relating to a discordant test result. The complaint seeks unspecified damages. The Company intends to continue to defend the matter vigorously, but cannot provide any assurance as to the ultimate outcome or that an adverse resolution would not have a material adverse effect on its financial condition and results of operations. The Company is unable to predict the ultimate outcome and is unable to make a meaningful estimate of the amount or range of loss, if any, that could result from any unfavorable outcome. On December 12, 2015, the Company received a civil investigative demand from the United States Department of Justice in connection with a qui tam action related to past reimbursement submissions for some of its testing. The qui tam action was originally filed under seal by the relators on January 26, 2015 in the United States District Court for the Western District of Kentucky. The qui tam complaint alleged that Natera submitted false claims to government health care programs for its testing services performed during the period from January 1, 2013 to December 31, 2016, and sought damages and penalties. The complaint was unsealed on February 8, 2018. On March 7, 2018, the Company reached agreement with the United States Department of Justice to resolve all claims made against it in the action. Under the settlement agreement, the Company will pay a total of approximately $11.4 million to the federal government and the participating state Medicaids, of which approximately $5.3 million plus applicable interest will be paid in four equal quarterly installments, subject to the Company’s option to prepay without penalty. In exchange for the payment of the settlement amounts, the United States and the relators agreed to release the Company from certain claims, including civil or administrative monetary relief sought under the complaint. The settlement agreement does not contain or represent an admission of liability or wrongdoing by the Company, and there will be no corporate integrity agreement. For the year ended December 31, 2017, the Company recorded a charge of $11.4 million associated with this settlement in its statements of operations and comprehensive loss. During the year ended December 31, 2018, the Company paid $5.3 million and the required quarterly installments, and the final quarterly installment of $1.4 million remained in its other accrued liabilities as of December 31, 2018. See Note 6 under Other Accrued Liabilities for more detail on payments made . Director and Officer Indemnifications As permitted under Delaware law, and as set forth in the Company’s Certificate of Incorporation and its Bylaws, the Company indemnifies its directors, executive officers, other officers, employees and other agents for certain events or occurrences that may arise while in such capacity. The maximum potential amount of future payments the Company could be required to make under this indemnification is unlimited; however, the Company has insurance policies that may limit its exposure and may enable it to recover a portion of any future amounts paid. Assuming the applicability of coverage, the willingness of the insurer to assume coverage, and subject to certain retention, loss limits and other policy provisions, the Company believes any obligations under this indemnification would not be material, other than an initial $1.5 million for securities related claims an $0.3 million for commercial general liability claims. However, no assurances can be given that the covering insurers will not attempt to dispute the validity, applicability, or amount of coverage without expensive litigation against these insurers, in which case the Company may incur substantial liabilities as a result of these indemnification obligations. Third-Party Payer Reimbursement Audits From time to time, the Company receives recoupment requests from third-party payers for alleged overpayments. The Company disagrees with the contentions of pending requests and/or has recorded an estimated reserve for the alleged overpayments. The Company is unable to predict the outcome and is unable to make a meaningful estimate of the amount or range of loss, if any, that could result from any unfavorable outcome, and/or amounts recorded as an estimated reserve for the alleged overpayments is not material. Contractual Commitments As of December 31, 2018, the Company has non‑cancelable contractual commitments with a supplier for approximately $8.9 million and other material supplier commitments for approximately $5.3 million for inventory material used in the laboratory testing process. As of December 31, 2018, the Company has a non-cancelable application service agreement with a vendor, in which a license was granted to the Company to utilize the proprietary technology for gene sequencing data analysis. The minimum committed fees remaining under the agreement is $2.1 million, which covers services through March 2020 As of December 31, 2018, the Company has a non-cancelable contractual commitments with a vendor for biological sample processing and storage totaling approximately $0.5 million for the next 12 months. As of December 31, 2018, the Company has non-cancelable minimum purchase commitments with a supplier of diagnostic reagents totaling approximately $2.0 million through February 2020.

Stock-Based Compensation

Stock-Based Compensation	12 Months Ended
	Dec. 31, 2018
Stock-Based Compensation
Stock-Based Compensation	8. Stock‑Based Compensation Equity Plans 2015 Equity Incentive Plan General . The Company’s board of directors adopted its 2015 Equity Incentive Plan, or the 2015 Plan, in June 2015. The Company’s 2015 Plan replaced all of its prior stock plans. Share Reserve . The initial number of shares of the Company’s common stock available for issuance under the 2015 Plan was 3,451,495 shares. As of December 31, 2018, 14,584,892 shares were reserved for future issuance under the 2015 plan, which includes unissued and forfeited shares from the 2007 plan. The number of shares reserved for issuance under the 2015 Plan will be increased automatically on the first business day of each fiscal year, commencing in 2016, by a number equal to the smallest of: · 3,500,000 shares; · 4% of the shares of common stock outstanding on the last business day of the prior fiscal year; or · the number of shares determined by the Company’s board of directors. Stock options vest as determined by the compensation committee. In general, they will vest over a four-year period following the date of grant. Stock options expire at the time determined by the compensation committee but in no event more than ten years after they are granted. These awards generally expire earlier if the participant's service terminates earlier. Restricted Shares and Stock Units. Restricted shares and stock units may be awarded under the 2015 Plan in return for any lawful consideration, and participant who receive restricted shares or stock units generally are not required to pay cash for their awards. In general, these awards will be subject to vesting. Vesting may be based on length of service, the attainment of performance-based milestones or a combination of both, as determined by the compensation committee. 2015 Employee Stock Purchase Plan General . The Company’s 2015 Employee Stock Purchase Plan, or 2015 ESPP, was adopted by its board of directors in June 2015 and its stockholders approved it in June 2015. The 2015 ESPP is intended to qualify under Section 423 of the Internal Revenue Code. Share Reserve. The Company has reserved 893,548 shares of its common stock for issuance under the 2015 ESPP. As of December 31, 2018, 1,285,851 shares were available for issuance under the 2015 ESPP. The number of shares reserved for issuance under the 2015 ESPP will automatically be increased on the first business day of each of the Company’s fiscal years, commencing in 2016, by a number equal to the least of: · 880,000 shares; · 1% of the shares of common stock outstanding on the last business day of the prior fiscal year; or · the number of shares determined by the Company’s board of directors. The number of shares reserved under the 2015 ESPP will automatically be adjusted in the event of a stock split, stock dividend or a reverse stock split (including an adjustment to the per-purchase period share limit). Purchase Price. Employees may purchase each share of common stock under the 2015 ESPP at a price equal to 85% of the lower of the fair market values of the stock as of the beginning or the end of the six-month offering periods. An employee’s payroll deductions under the ESPP are limited to 15% of the compensation, and up to a maximum of 5,000 shares may be purchased during any offering period. A participant shall not be granted an option under the ESPP if such option would permit the participant’s rights to purchase stock to accrue at a rate exceeding $25,000 fair market value of stock for each calendar year in which such option is outstanding at any time. Offering Periods. Each offering period will last a number of months determined by the compensation committee, not to exceed 27 months. A new offering period will begin periodically, as determined by the compensation committee. Offering periods may overlap or may be consecutive. Unless otherwise determined by the compensation committee, two offering periods of six months' duration will begin in each year on May 1 and November 1. The first offering period of 2018 started on November 1, 2017 and ended on April 30, 2018, and 206,447 shares were purchased at the end of the first offering period for total proceeds of approximately $1.9 million. The second offering period of 2018 started on May 1, 2018 and ended on October 31, 2018, and 184,825 shares were purchased at the end of this offering period for total proceeds of approximately $1.7 million. Stock Options The following table summarizes option activity during the year ended December 31, 2018: Outstanding Options Weighted- Weighted- Average Shares Average Remaining Aggregate Available for Number of Exercise Contractual Intrinsic (in thousands, except for contractual life and exercise price) Grant Shares Price Life Value (In years) Balance at December 31, 2017 4,737 9,963 $ 6.54 7.03 $ 31,902 Additional shares authorized 2,161 — Options granted (2,319) 2,319 $ 11.77 Options exercised — (1,967) $ 6.78 Options forfeited 852 (852) $ 7.54 Balance at December 31, 2018 5,431 9,463 $ 7.69 6.91 $ 61,718 Exercisable at December 31, 2018 5,484 $ 5.25 5.57 $ 48,055 Vested and expected to vest at December 31, 2018 9,224 $ 7.60 6.87 $ 60,895 The total intrinsic value of stock options exercised during the years ended December 31, 2018, 2017 and 2016 was $25.6 million, $3.7 million and $16.9 million, respectively. The total fair value of stock options vested during the years ended December 31, 2018, 2017 and 2016 was $11.3 million, $12.1 million, and $8.5 million, respectively. The weighted-average grant date fair value of options granted during the years ended December 31, 2018, 2017 and 2016 was $4.85, $5.71 and $5.92 per share, respectively. Performance-based Awards In June 2017, the Board approved a stock option grant of 425,000 shares to the Company’s chief executive officer, of which 200,000 shares are performance-based options. The vesting of these performance-based options is contingent upon the completion of requisite service for the next three years and the achievement of certain milestones within such period. The milestones are (i) to successfully secure a specified strategic arrangement, at which point 50,000 shares will begin vesting over one year in equal quarterly installments, (ii) to successfully secure a specified licensing arrangement, at which point 75,000 shares will begin vesting over one year in equal quarterly installments, and (iii) to successfully secure specified licensing arrangements related to oncology, at which point 75,000 shares will begin vesting over one year in equal quarterly installments. Each milestone is independent of the other. For the year ended December 31, 2017, the Company did not recognize any compensation expense associated with the performance-based options since none of the milestones were achieved or were probable of being achieved. For the year ended December 31, 2018, the Company recognized stock-based compensation cost associated with the performance-based options of $0.4 million after it evaluated that milestone (ii) described above was achieved. In December 2018, the Board approved a performance-based option grant of 600,000 shares to the Company’s executive chairman. The vesting of these performance-based options is contingent upon the achievement of a certain milestone, and provided that the completion of requisite service is through the date of such vesting, at which point the performance-based options will become fully vested and exercisable. The revenue milestone was not achieved or was not probable of being achieved during the year ended December 31, 2018, and the Company did not recognize any compensation expense associated with it. Restricted Stock Units The following table summarizes restricted stock unit activity for the year ended December 31, 2018: Weighted- Average Number of Grant Date Shares Fair Value Balance at December 31, 2017 389 $ 10.38 Granted 953 $ 11.86 Vested (177) $ 13.84 Canceled/Forfeited (81) $ 9.91 Balance at December 31, 2018 1,084 $ 11.72 Stock‑Based Compensation Expense Employee and non‑employee stock‑based compensation expense was calculated based on awards ultimately expected to vest and have been reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods, if actual forfeitures differ from those estimates. The following table presents the effect of employee and non‑employee stock‑based compensation expense on selected statements of operations line items for the years ended December 31, 2018, 2017 and 2016. Year ended December 31, 2018 2017 2016 Employee Non-Employee Total Employee Non-Employee Total Employee Non-Employee Total (in thousands) Cost of revenues $ 564 $ 5 $ 569 $ 544 $ — $ 544 $ 651 $ (10) $ 641 Research and development 4,043 — 4,043 3,214 — 3,214 2,829 24 2,853 Selling, general and administrative 9,474 112 9,586 7,644 — 7,644 6,837 270 7,107 Total $ 14,081 $ 117 $ 14,198 $ 11,402 $ — $ 11,402 $ 10,317 $ 284 $ 10,601 As of December 31, 2018, approximately $24.8 million of unrecognized compensation expense related to unvested option awards and RSUs, net of estimated forfeitures. The unrecognized compensation expense will be recognized over a weighted‑average period of approximately 2.45 years. Valuation of Stock Option Grants to Employees The Company estimates the fair value of its stock options granted to employees on the grant date using the Black‑Scholes option‑pricing model. The fair value of employee stock options is amortized on a straight‑line basis over the requisite service period of the awards, generally the vesting period. The fair value of employee stock options was estimated using the following assumptions: Year ended December 31, 2018 2017 2016 Expected term (years) 5.24 — 5.62 5.14 — 5.24 5.10 — 5.20 Expected volatility 40.28 % — 42.53 % 40.75 % — 62.93 % 63.06 % — 72.49 % Expected dividend rate 0 % 0 % 0 % Risk-free interest rate 2.37 % — 3.06 % 1.67 % — 2.16 % 0.97 % — 1.92 % Valuation of Stock Option Grants to Non-Employees Total options outstanding as of December 31, 2018 include 131,865 shares of option awards that were granted to non-employees, of which 36,344 shares are unvested. Stock-based compensation expense related to stock options granted to non-employees is recognized as the stock option is earned and the services are rendered. The Company believes that the estimated fair value of the stock options is more readily measurable than the fair value of the services rendered. The fair value of the stock options granted to non-employees is calculated at each reporting date using the Black-Scholes options-pricing model with the following assumptions: Year ended December 31, 2018 2017 2016 Expected term (years) 2.72 — 2.76 2.67 — 2.71 2.65 — 3.16 Expected volatility 41.36 % — 43.84 % 41.22 % — 52.18 % 50.90 % — 72.61 % Expected dividend rate 0 % 0 % 0 % Risk-free interest rate 2.36 % — 2.86 % 1.42 % — 1.95 % 0.68 % — 1.38 % Expected Term : The expected term of options represents the period of time that options are expected to be outstanding. The Company determines its expected term by calculating the average of—(1) its employees’ historical stock options exercise behavior, and (2) the weighted-average of the time-to-vesting and the total contractual life of the options. For employee stock options that are not granted "at-the-money," the Company uses the binomial lattice model to calculate the expected term. Regarding non-employee stock options, the Company estimated the expected term by assessing their historical exercise behavior and length of service, and calculated the average of these two components. Expected Volatility : The Company derived the expected volatility from the average historical volatilities of comparable publicly traded companies within its peer group over a period approximately equal to the expected term. Expected Dividend Rate : The Company has not paid and does not anticipate paying any dividends in the near future. Risk-Free Interest Rate : The risk-free interest rate assumption is based on U.S. Treasury yield in effect at the time of grant for zero coupon U.S. Treasury notes with maturities approximately equal to the expected term.

Debt

Debt	12 Months Ended
	Dec. 31, 2018
Debt
Debt	9. Debt Credit Line Agreement In September 2015, the Company entered into a credit line with UBS (the “Credit Line”) providing for a $50.0 million revolving line of credit which can be drawn down in increments at any time. The Credit Line bears interest at 30-day LIBOR plus 1.10%, and it is secured by a first priority lien and security interest in the Company’s money market and marketable securities held in its managed investment account with UBS. UBS has the right to demand full or partial payment of the Credit Line Obligations and terminate the Credit Line, in its discretion and without cause, at any time. For the years ended December 31, 2018, 2017 and 2016, the Company recorded interest expense of $1.6 million, $1.0 million and $0.5 million, respectively. Interest payments totaling $1.5 million and $0.5 million had been made on the Credit Line during the years ended December 31, 2018 and 2017, respectively. As of December 31, 2018, remaining accrued interest was $1.2 million, and the total principal amount outstanding including accrued interest was $50.2 million. 2017 Term Loan In August 2017, the Company entered into the 2017 Term Loan with OrbiMed, which has a maximum borrowing capacity of $100.0 million. On the closing date of August 8, 2017, the Company borrowed $75.0 million, with the remaining $25.0 million available to borrow at the Company’s option at any time through December 31, 2018, subject to standard conditions. The amounts borrowed under 2017 Term Loan will primarily be used for general corporate purposes and to fund and support the Company’s business and operations. Interest is accrued on the outstanding balance of the loan at a rate equal to the sum of (i) 8.75% plus (ii) the higher of 1.00% or LIBOR. The 2017 Term Loan has an eighty-four month term and will mature in August 2024. The Company is required to make interest payments on a quarterly basis, with repayment of the full outstanding balance on the maturity date. The Company’s obligations under the 2017 Term Loan are secured by substantially all of its assets, including its intellectual property, subject to certain customary exceptions. On December 31, 2018, the Company amended certain terms in the 2017 Term Loan with OrbiMed. The amendment increased the existing unused borrowing capacity from $25.0 million to $50.0 million and extended the expiration date for the option to draw the additional to March 31, 2019. If such option were exercised by the Company, the interest rate described above would instead decrease to the sum of (i) 8.50% plus (ii) the higher of 1.00% or LIBOR. The 2017 Term Loan contains customary affirmative and negative covenants including financial information maintenance covenants, indebtedness limitation covenants, minimum net revenues covenants, and investment covenants. It also includes standard events of default such as payment defaults and nonperformance of obligations and covenants described above. Upon an event of default, an additional interest of 3.00% may be applied to the outstanding debt balance until such default is cured, and OrbiMed may declare all outstanding obligations immediately due and payable. As of December 31, 2018, the Company was in compliance with all of its covenants under the 2017 Term Loan. The Company is allowed to voluntarily make prepayments on its outstanding debt balance either partially or in full. When prepayments are made, an additional prepayment premium will be applied to the outstanding principal amount at the time. The prepayment premium will gradually reduce from 12.5% to 2.5% over the term of the loan. On August 14, 2017, the Company paid OrbiMed a fee in consideration of providing the 2017 Term Loan by issuing 300,000 shares of its common stock. The fair value of the fee was $2.4 million, which was determined based on the Company’s stock price of $8.16 on August 8, 2017. Additionally, the Company paid legal fees of $0.3 million in connection with this term loan. Total debt issuance costs incurred amounted to $2.7 million, which is accounted for as a debt discount to be amortized on a straight-line basis over the term of the loan. The Company has classified $2.0 million of the debt discount as a direct reduction from the outstanding debt balance of $75.0 million, while the remainder is classified as noncurrent assets (as described in Note 6). For the years ended December 31, 2018 and 2017, interest expense totaling $8.6 million and $3.2 million was recorded, respectively, which also included the amortization of debt discount. Debt discount amortized as interest expense was $0.4 million and $0.1 million for the years ended December 31, 2018 and 2017, respectively. In addition, the Company made interest payments totaling $6.1 million and $3.1 million during the years ended December 31, 2018 and 2017, respectively. As of December 31, 2018, interest accrued for the 2017 Term Loan was $2.1 million, which was paid in January 2019. The Company has not made any principal payment as it is not required to repay the outstanding balance until August 2024. The following table indicates how the Company reported its long-term debt at the end of the period: December 31, December 31, 2018 2017 (Amounts in thousands) Debt principal balance $ 75,000 $ 75,000 Less: unamortized debt discount (1,643) (1,935) Net carrying amount at end of period $ 73,357 $ 73,065

Warrants

Warrants	12 Months Ended
	Dec. 31, 2018
Warrants.
Warrants	10. Warrants In April 2014, the Company granted warrants to purchase approximately 376,691 warrants to purchase common stock with an exercise price of $2.3229 per common share. The warrants were granted to ROS Acquisition Offshore LP in connection with the Company’s senior secured term loan that has since been repaid and have an expiration date of April 18, 2023. It was determined that the warrants granted are detachable and therefore are a stand-alone component of the senior secured term loan to be fair valued using Level III inputs as a separate derivative. On June 26, 2018, the warrants were fully exercised by ROS using the option of net share settlement. Instead of remitting cash exercise proceeds to purchase the shares, ROS elected to receive a net amount of 332,896 shares. The Company remeasured the fair value of its warrant liability to $6.8 million during this period until June 26, 2018 and reclassified this amount to stockholders’ equity .

Stockholders' Equity

Stockholders' Equity	12 Months Ended
	Dec. 31, 2018
Stockholders' Equity
Stockholders' Equity	11. Stockholders’ Equity As of December 31, 2018, the Company had 50,000,000 authorized shares of its preferred stock, of which no shares were issued and outstanding; and 750,000,000 authorized shares of its common stock, at $0.0001 par value, and there were 62,082,348 shares of common stock issued and outstanding. In August 2017, the Company paid OrbiMed a fee in consideration of providing the 2017 Term Loan (as defined in Note 9) by issuing 300,000 shares of its common stock. The fair value of the fee was $2.4 million, which was determined based on the Company’s stock price of $8.16 on August 8, 2017. In June 2018, OrbiMed exercised all of its warrants, which were all converted into common stock. The exercise was a cashless transaction, and there were 332,896 of net shares issued to OrbiMed following the exercise at the fair value of $6.8 million. In July 2018, the Company completed an equity offering to sell 4,500,000 shares of its common stock to the public at a price of $20 per share, along with the sale of 675,000 additional shares of its common stock to the underwriters upon their exercise of the option to purchase those shares. Upon the closing of the equity offering, the Company received proceeds of $97.3 million before offering expenses, which totaled approximately $0.5 million.

Income Taxes

Income Taxes	12 Months Ended
	Dec. 31, 2018
Income Taxes
Income Taxes	12. Income Taxes The Company's effective tax rates for the years ended December 31, 2018, 2017 and 2016 differ from the U.S. federal statutory rate as follows: Year Ended December 31, 2018 2017 2016 (in thousands, except percentages) U.S. federal taxes (benefit) at statutory rate $ (26,800) % $ (46,206) % $ (32,277) % State tax expense (4,468) % (6,559) % (2,842) % Research and development credits (1,164) % (1,149) % (1,449) % Stock-based compensation (3,148) % (5,036) % 1,275 1.34 % Change in federal tax rate — 0.00 % 44,701 32.89 % — % Mark to market fair value adjustments 865 0.68 % (390) % 49 0.05 % Nondeductible settlement for claims 1 0.00 % 3,873 2.85 % — % Other nondeductible items 885 0.69 % 1,009 0.74 % 933 0.99 % Change in valuation allowance 34,150 26.76 % 10,211 7.51 % 34,453 36.29 % Provision for income taxes $ 321 0.25 % $ 454 0.31 % $ 142 0.15 % During the year ended December 31, 2018, the Company recorded total income tax expense of $0.3 million. The Company provides testing to clinics and also licenses its cloud-based software to licensees that are based in a foreign country, which contributed to a foreign income tax expense of $0.2 million. Total income tax expense also included a state income tax expense of $0.1 million for the year ended December 31, 2018. During the year ended December 31, 2017, the Company recorded total income tax expense of $0.4 million, which included foreign income tax expense of $0.2 million and state income tax expense of $0.2 million. During the year ended December 31, 2016, the Company did not record any income tax expense given its history of losses, with the exception of $0.1 million of foreign withholding tax in 2016. Deferred income taxes reflect the net tax effects of temporary differences between carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes as well as net operating loss and tax credit carryforwards. The components of the net deferred income tax assets are as follows: December 31, 2018 2017 (in thousands) Deferred tax assets: Net operating loss carryforwards $ 95,321 $ 77,356 Research and development tax credit carryforwards 15,632 12,675 Reserves and accruals 7,922 3,404 Stock-based compensation 4,076 2,929 Total deferred tax assets before valuation allowance 122,951 96,364 Less: valuation allowance (122,441) (95,817) 510 547 Deferred tax liabilities: Property and equipment (510) (547) Net deferred tax assets $ — $ — The Company established a full valuation allowance against its net deferred tax assets in 2018 and 2017 due to the uncertainty surrounding realization of these assets. The valuation allowance increased to $122.4 million as of December 31, 2018 from $95.8 million as of December 31, 2017. The valuation allowance increased during 2018 due to current year losses and credits claimed, offset by a reduction due to the adoption of ASC 606. The valuation allowance increased to $95.8 million as of December 31, 2017 from $85.6 million as of December 31, 2016. In December 2017, the U.S. Congress passed the Tax Cuts and Jobs Act of 2017 (“Tax Act”). As a result, corporate tax rate was reduced to 21%, effective January 1, 2018. ASC 740, Income Taxes , requires entities to recognize the effect of the tax law changes in the period of enactment. Shortly after the enactment of the Tax Act, the Securities and Exchange Commission (“SEC”) staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) to address the application of U.S. GAAP in situations when an entity does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Act. The Company made provisional adjustments to reduce its deferred tax assets and liabilities as of December 31, 2017, based on the reduction of the U.S. federal corporate tax rate from 34% to 21% and assessed the realizability of its deferred tax assets based on its current understanding of the provisions of the new law. As of December 31, 2018, the Company completed its assessment of the tax rate change and determined no additional adjustments are required. As of December 31, 2018, the Company had federal and state net operating loss (“NOLs”) carryforwards of approximately $394.0 million and $201.4 million, respectively, which begin to expire in 2027 and 2028, respectively, if not utilized. The Company also had federal research and development credit carryforwards of approximately $14.1 million, which begin to expire in 2027, and state research and development credit carryforwards of approximately $10.5 million, which can be carried forward indefinitely. Realization of these deferred tax assets would require $488.1 million in taxable income to fully utilize. Realization is dependent on generating sufficient taxable income prior to expiration of the loss and credit carryforwards. Federal and California tax laws impose substantial restrictions on the utilization of NOLs and credit carryforwards in the event of an "ownership change" for tax purpose, as defined in Section 382 of the Internal Revenue Code. Accordingly, the Company's ability to utilize these carryforwards may be limited as the result of such ownership change. Such a limitation could result in limitation in the use of the NOLs in future years and possibly a reduction of the NOLs available. A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows: Year Ended December 31, 2018 2017 2016 (in thousands) Balance at beginning of year $ 5,945 $ 4,293 $ 2,405 Additions based on tax positions related to the current year 1,416 1,651 1,836 Additions for tax positions of prior years 1 1 52 Balance at end of year $ 7,362 $ 5,945 $ 4,293 The Company adopted the provisions of ASC 740-10-50, Accounting for Uncertainty in Income Taxes , on January 1, 2009. During the years ended December 31, 2018, 2017 and 2016, the amount of unrecognized tax benefits increased $1.4 million, $1.7 million, and $1.9 million, respectively, due to additional research and development credits generated during the year. As of December 31, 2018, 2017 and 2016, the total amount of unrecognized tax benefits was $7.4 million, $5.9 million and $4.3 million, respectively. The reversal of the uncertain tax benefits would not affect the Company's effective tax rate to the extent that it continues to maintain a full valuation allowance against its deferred tax assets. The Company is subject to U.S. federal income taxes and to income taxes in various states in the United States. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations, and require significant judgment to apply. The Company is subject to U.S. federal, state and local tax examinations by tax authorities for all prior tax years since incorporation. The Company does not anticipate significant changes to its current uncertain tax positions through December 31, 2019. The Company recognizes any interest and/or penalties related to income tax matters as a component of income tax expense. As of December 31, 2018, there were no accrued interest and penalties related to uncertain tax positions.

Net Loss per Share

Net Loss per Share	12 Months Ended
	Dec. 31, 2018
Net Loss per Share
Net Loss per Share	13. Net Loss per Share Basic net loss per share attributable to common stockholders is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding for the period. In periods when the Company has incurred a net loss, common stock equivalents such as outstanding common stock options, restricted stock units, unvested common shares subject to repurchase and warrants are excluded from the calculation of diluted net loss per share as they give an anti-dilutive effect. For the year ended December 31, 2017, the Company reversed $1.1 million of remeasurement gain on the change in the fair value of warrants from its net loss and included the incremental shares from the assumed exercise of the warrants in the computation of its weighted-average shares outstanding as they yielded a dilutive effect to the net loss per share in the period. Other potentially dilutive common stock equivalents such as outstanding common stock options, shares to be purchased under the employee stock purchase plan, and restricted stock units were excluded as their effect was anti-dilutive and the net loss per share would be reduced. The following table provides the basic and diluted net loss per share computations for the years ended December 31, 2018, 2017 and 2016: Year ended December 31, (in thousands, except per share data) 2018 2017 2016 (As Revised) (As Revised) Numerator: Net loss used to compute net loss per share, basic $ (128,154) $ (137,628) $ (100,327) Less: Remeasurement gain on warrant liability — (1,148) — Net loss used to compute net loss per share, diluted $ (128,154) $ (138,776) $ (100,327) Denominator: Weighted-average common shares outstanding 57,848 53,312 51,667 Less: Weighted-average unvested common shares subject to repurchase — — (91) Weighted-average number of shares used in computing net loss per share, basic 57,848 53,312 51,576 Add: Incremental shares from assumed exercise of warrants — 292 — Weighted-average number of shares used in computing net loss per share, diluted 57,848 53,604 51,576 Net loss per share, basic $ (2.22) $ (2.58) $ (1.95) Net loss per share, diluted $ (2.22) $ (2.59) $ (1.95) The following table shows the potentially dilutive common stock equivalents that were excluded from the computations of diluted net loss per share as their effect would be anti-dilutive, as of December 31, 2018, 2017 and 2016: As of December 31, 2018 2017 2016 Options to purchase common stock 9,463 9,963 9,043 Warrants to purchase common stock — — 377 Restricted stock units 1,084 389 159 Employee stock purchase plan 42 79 90 10,589 10,431 9,669

Subsequent Events

Subsequent Events	12 Months Ended
	Dec. 31, 2018
Subsequent Events
Subsequent Events	14 . Subsequent Events In January 2019, the Company amended the existing agreement with one of its vendors to establish non-cancelable contractual commitments for a minimum number of genetic tests to be processed, as well as the price per test processed. The amended agreement has a remaining term of two years starting January 1, 2019. For the next 12 months, total contractual commitments are $9.7 million. The commitments beyond 12 months will be determined at the end of 2019. In February 2019, the Company entered into a License Agreement with BGI Genomics Co., Ltd (“BGI Genomics”) to develop and commercialize NGS-based genetic testing assays for clinical use. According to the agreement, the Company will receive a total of $50.0 million, comprising $35.0 million in upfront technology licensing fees and prepaid royalties, and $15.0 million in future milestone payments. The Company is committed to pay $6.0 million for future test services. The Company will also prepay $4.0 million to another supplier. The License Agreement has a term of ten years and expires in February 2029. This Agreement is subject to customary closing conditions, including partner government approval. In March 2019, the Company paid off the final quarterly installment of $1.4 million imposed by the settlement agreement relating to reimbursement-related claims. As required by the settlement agreement, a letter of credit was secured with a financial institution until the settlement amount was entirely paid off. The letter of credit expired on March 1, 2019, and accordingly, the funds totaling $4.2 million (see Note 2 under Restricted Cash ) were available to the Company.

Quarterly Financial Data

Quarterly Financial Data	12 Months Ended
	Dec. 31, 2018
Quarterly Financial Data
Quarterly Financial Data	15 . Quarterly Financial Data (unaudited) Three months ended December 31, September 30, June 30, March 31, (in thousands, except per share data) 2018 Operating results: Total revenues $ 66,965 $ 65,280 $ 63,069 $ 62,340 Cost of product revenues 40,345 39,477 39,204 39,055 Cost of licensing and other revenues 2,444 2,202 1,791 1,537 Gross profit 24,176 23,601 22,074 21,748 Operating expenses 53,903 50,767 49,292 52,265 Interest expense and other (expense) income, net (2,128) (2,332) (6,493) (2,252) Income tax expense 14 (118) (113) (104) Net loss $ (31,841) $ (29,616) $ (33,824) $ (32,873) Per share data: Net loss - basic $ (0.51) $ (0.49) $ (0.62) $ (0.61) Net loss - diluted $ (0.51) $ (0.49) $ (0.62) $ (0.61) 2017 (As Revised) Operating results: Total revenues $ 52,050 $ 55,910 $ 52,283 $ 49,382 Cost of product revenues 35,153 33,558 33,709 33,088 Cost of licensing and other revenues 1,572 1,054 850 612 Gross profit 15,325 21,298 17,724 15,682 Operating expenses 61,956 47,087 46,095 50,232 Interest expense and other (expense) income, net (405) (1,914) (631) 1,117 Income tax expense (181) (162) (64) (47) Net loss $ (47,217) $ (27,865) $ (29,066) $ (33,480) Per share data: Net loss - basic $ (0.88) $ (0.52) $ (0.55) $ (0.63) Net loss - diluted $ (0.90) $ (0.52) $ (0.55) $ (0.65)

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Dec. 31, 2018
Summary of Significant Accounting Policies
Basis of Presentation	Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”).
Liquidity Matters	Liquidity Matters The Company has incurred net losses since its inception and anticipates net losses and negative operating cash flows for the near future. For the year ended December 31, 2018, the Company had a net loss of $128.2 million, which increased the accumulated deficit to $574.6 million from $446.4 million at December 31, 2017 following the full retrospective adoption of ASU 2014-09, which required a cumulative-effect adjustment to be recorded to accumulated deficit as of the earliest period presented in the consolidated financial statements. At December 31, 2018, the Company had $46.4 million in cash and cash equivalents, $107.5 million in marketable securities, $50.2 million of outstanding balance of the Credit Line (as defined in Note 9) including accrued interest, and $73.4 million of net carrying amount of the 2017 Term Loan (as defined in Note 9). While the Company has introduced multiple products that are generating revenues, these revenues have not been sufficient to fund all operations. Accordingly, the Company has funded the portion of operating costs that exceeds revenues through a combination of equity issuances, debt issuances, and financing under the 2017 Term Loan with an option to borrow an additional $50.0 million. The Company continues to develop and commercialize future products and, consequently, it will need to generate additional revenues to achieve future profitability and may need to raise additional equity or debt financing. If the Company raises additional funds by issuing equity securities, its stockholders would experience dilution. Additional debt financing, if available, may involve covenants restricting its operations or its ability to incur additional debt. Any additional debt financing or additional equity that the Company raises may contain terms that are not favorable to it or its stockholders and require significant debt service payments, which diverts resources from other activities. Additional financing may not be available at all, or in amounts or on terms acceptable to the Company. If the Company is unable to obtain additional financing, it may be required to delay the development, commercialization and marking of its products and significantly scale back its business and operations. In July 2018, the Company completed an equity offering to sell 4,500,000 shares of its common stock to the public at a price of $20 per share, along with the sale of 675,000 additional shares of its common stock to the underwriters upon their exercise of the option to purchase those shares. Upon the closing of the equity offering, the Company received proceeds of $97.3 million before offering expenses, which totaled approximately $0.5 million. Based on the Company’s current business plan, the Company believes that its existing cash and marketable securities will be sufficient to meet its anticipated cash requirements for at least 12 months after March 15, 2019.
Principles of Consolidation	Principles of Consolidation The accompanying consolidated financial statements include all the accounts of the Company and its subsidiary. The Company established a subsidiary that operates in the state of Texas to support the Company’s laboratory and operational functions. All intercompany balances and transactions have been eliminated.
Use of Estimates	Use of Estimates The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions about future events that affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. Significant items subject to such estimates include the allowance for doubtful accounts, deferred revenues associated with unsatisfied performance obligations, accrued liability for potential refund requests, stock-based compensation, the fair value of common stock and warrants, income tax uncertainties, and the expected consideration to be received from contracts with customers. These estimates and assumptions are based on management's best estimates and judgment. Management regularly evaluates its estimates and assumptions using historical experience and other factors, including contractual terms and statutory limits; however, actual results could differ from these estimates and could have an adverse effect on the Company's financial statements. For the year ended December 31, 2018, the Company revised the estimate of its expected consideration for certain genetic test services as the amounts collected from its payers were different than what was initially assessed. The revision of the estimate was treated as a change in accounting estimate. See Note 3 for more detail on this accounting change and its resulting impact on the Company’s financial statements.
Fair Value	Fair Value The Company discloses the fair value of financial instruments for financial assets and liabilities for which the value is practicable to estimate. Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price).
Cash and Cash Equivalents	Cash and Cash Equivalents Cash and cash equivalents consist of cash and money market deposits with financial institutions.
Restricted Cash	Restricted Cash As of December 31, 2018, the Company had restricted cash primarily consisting of $4.2 million in cash deposits held to secure a letter of credit associated with a settlement agreement in connection with reimbursement related claims (as described in Note 7 under Legal Proceedings ) and $0.3 million of deposit per credit card terms. The Company adopted Accounting Standard Update No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (“ASU 2016-18”), effective January 1, 2018, which required the change in restricted cash to be included as part of the total cash and cash equivalents. While restricted cash is still presented as a separate line item in the Company’s balance sheet, it is no longer presented as a separate item in the statements of cash flows. ASU 2016-18 also required a restatement of the statements of cash flows in the prior period presented to report this change. The following is the reconciliation between how restricted cash is presented in the balance sheet and the statements of cash flows for all periods presented: December 31, December 31, December 31, December 31, 2018 2017 2016 2015 (in thousands) Cash and cash equivalents in balance sheet $ 46,407 $ 12,620 $ 15,256 $ 28,947 Restricted cash, current portion in balance sheet 4,597 59 1,092 901 Restricted cash in other assets in balance sheet — 342 342 683 Total cash, cash equivalents and restricted cash in statements of cash flows $ 51,004 $ 13,021 $ 16,690 $ 30,531
Investments	Investments Investments consist primarily of debt securities such as U.S. Treasuries, U.S. agency and municipal bonds. Management determines the appropriate classification of securities at the time of purchase and reevaluates such determination at each balance sheet date. The Company generally classifies its entire investment portfolio as available-for-sale. The Company views its available-for-sale portfolio as available for use in current operations. Accordingly, the Company classifies all investments as short-term, even though the stated maturity may be more than one year from the current balance sheet date. Available-for-sale securities are carried at fair value, with unrealized gains and losses reported in accumulated other comprehensive income (loss), which is a separate component of stockholders’ equity.
Risk and Uncertainties	Risk and Uncertainties The Company has various financial instruments that are potentially subjected to credit risk, and they consist of cash, accounts receivable and investments. The Company limits its exposure to credit loss by placing its cash in financial institutions with high credit ratings. The Company's cash may consist of deposits held with banks that may at times exceed federally insured limits. The Company performs evaluations of the relative credit standing of these financial institutions and limits the amount of credit exposure with any one institution. The Company bills third-party payers for certain tests performed. The amount that is ultimately received from the payer for the Company’s claim and the timing of such payments are subject to the determination of the payer based on the nature of the test performed and their view of the Company’s business practices with respect to collections of plan deductibles and co-payments from patients and other activities. This determination can impact both the amount and timing of when the Company’s invoices are collected. Payers may also withhold payments and request refunds of prior payments if the payer asserts that the Company has not performed in accordance with the policies of these payers. The Company performs evaluations of financial conditions for clinics and laboratory partners and generally does not require collateral to support credit sales. In 2018, 2017 and 2016, there were no customers exceeding 10% of total revenues on an individual basis. As of December 31, 2018 and 2017, there were no customers with an outstanding balance exceeding 10% of net accounts receivable.
Allowance for Doubtful Accounts	Allowance for Doubtful Accounts Trade accounts receivable are recorded at the amount billed to the laboratory partners and clinics. Reducing this amount is an allowance for doubtful accounts for estimated losses resulting from the inability of its customers to make the contracted payments. Management analyzes accounts receivable and historical bad debt experience, customer creditworthiness, current economic trends, and changes in customer payment history when evaluating the adequacy of the allowance for doubtful accounts. Accounts receivable are written off against the allowance when there is substantive evidence that the account will not be paid.
Revenue Recognition	Revenue Recognition The Company adopted the new revenue recognition guidance, ASC 606, beginning January 1, 2018 on a full retrospective basis. ASC 606 mandates revenue recognition to be evaluated using the following five steps: · Identification of a contract, or contracts, with a customer; · Identification of the performance obligations in the contract; · Determination of the transaction price; · Allocation of the transaction price to the performance obligations in the contract; and · Revenue recognition when, or as, the performance obligations are satisfied See Note 3, Revenue Recognition, for detailed discussions of product revenues, licensing and other revenues, and how the five steps described above are applied.
Cost of Product Revenues	Cost of Product Revenues The components of cost of product revenues are material and service costs, impairment charges associated with testing equipment, personnel costs, including stock-based compensation expense, equipment and infrastructure expenses associated with testing samples, electronic medical record, order and delivery systems, shipping charges to transport samples, third-party test processing fees and allocated overhead including rent, information technology costs, equipment depreciation and utilities. Costs associated with the performance of diagnostic services are recorded as tests are accessioned.
Cost of Licensing and Other Revenues	Cost of Licensing and Other Revenues The components of cost of licensing and other revenues are material costs associated with test kits, engineering costs incurred by the research and development team to improve and maintain the Constellation software platform, and amortization of Constellation software development costs. Costs also include collection kits consumed during the processing of cord blood samples, processing service and storage of the cord blood samples, and freight charged to transport the samples to the storage facility.
Research and Development	Research and Development The Company records research and development costs in the period incurred. Research and development costs consist of personnel costs, contract services, cost of materials utilized in performing tests, costs of clinical trials and allocated facilities and related overhead expenses.
Advertising Costs	Advertising Costs The Company expenses advertising costs as incurred. The Company incurred advertising costs of $0.2 million, $0.5 million and $0.4 million for the years ended December 31, 2018, 2017 and 2016, respectively.
Product Shipment Costs	Product Shipment Costs The Company expenses product shipment costs in cost of product revenues in the accompanying statements of operations. Shipping and handling costs for the years ended December 31, 2018, 2017 and 2016 were $12.4 million, $9.5 million and $8.2 million, respectively.
Income Taxes	Income Taxes Income taxes are recorded in accordance with Financial Accounting Standards Board ASC Topic 740, Income Taxes ("ASC 740"), which provides for deferred taxes using an asset and liability approach. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. Tax benefits are recognized when it is more likely than not that a tax position will be sustained during an audit. Deferred tax assets are reduced by a valuation allowance if current evidence indicates that it is considered more likely than not that these benefits will not be realized.
Stock-Based Compensation	Stock‑Based Compensation Stock‑based compensation related to stock options and restricted stock units (“RSUs”) granted to the Company’s employees is measured at the grant date based on the fair value of the award. The fair value is recognized as expense over the requisite service period, which is generally the vesting period of the respective awards. No compensation cost is recognized when the requisite service has not been met and the awards are therefore forfeited. The Company uses the Black‑Scholes option‑pricing model to estimate the fair value of stock options issued to employees and non-employees. The measurement of stock-based compensation is subject to periodic adjustments as the underlying equity instruments vest, and the resulting change in value, if any, is recognized in the Company's statements of operations and comprehensive loss during the period that the related services are rendered. The Black-Scholes option-pricing model requires the input of the Company's expected stock price volatility, the expected term of the awards, and a risk-free interest rate. Determining these assumptions requires significant judgment. The expected term was based on the simplified method and the volatility rate was based on that of publicly traded companies in the DNA sequencing, diagnostics, or personalized medicine industries. When selecting the public companies in these industries to be used in the volatility calculation, companies were selected with comparable characteristics to the Company, including enterprise value and financial leverage. Companies were also selected with historical share price volatility sufficient to meet the expected term of the Company's stock options. The historical volatility data was computed using the daily closing prices for the selected companies' shares during the equivalent period of the calculated expected term of the Company's stock options. The expected term of the non-employee option grants was based on their remaining contractual life at the measurement date. The risk-free interest rate assumption was based on U.S. Treasury instruments with maturities that were consistent with the option's expected term. Starting January 1, 2016, the Company began using a different approach to estimate the expected term of its stock option awards, which involves calculating the average of—(1) its employees’ historical stock option exercise behavior, and (2) the weighted-average of the time-to-vesting and the total contractual life of the options. The Company applied this change in methodology prospectively and accounted for it as a change in accounting estimate.
Warrants	Warrants The Company accounts for warrants to purchase shares of its common stock as a liability at fair value on the balance sheet date because the Company may be obligated to redeem these warrants at some point in the future. The warrants are subject to remeasurement at each balance sheet date, with changes in fair value recognized as a gain or loss from the changes in fair value of the warrants in the statements of operations and comprehensive loss. Further adjustments resulting from changes in fair value are no longer required as the warrants were fully exercised in June 2018.
Capitalized Software Held for Internal Use	Capitalized Software Held for Internal Use The Company capitalizes salaries and related costs of employees and consultants who devote time to the development of internal-use software development projects. Capitalization begins during the application development stage, once the preliminary project stage has been completed, which includes successful validation and approval from management. If a project constitutes an enhancement to previously developed software, the Company assesses whether the enhancement is significant and creates additional functionality to the software, thus qualifying the work incurred for capitalization. Once the project is available for general release, capitalization ceases and the Company estimates the useful life of the asset and begins amortization. The Company periodically assesses whether triggering events are present to review internal-use software for impairment. Changes in estimates related to internal-use software would increase or decrease operating expenses or amortization recorded during the reporting period. Refer to Property and Equipment, net under Note 6 for more detail regarding an impairment charge recorded to write off certain project development costs during the first quarter of 2018. The Company amortizes its internal-use software over the estimated useful lives of three years. The net book value of capitalized software held for internal use was $1.7 million and $2.6 million as of December 31, 2018 and 2017, respectively. Amortized expense for amounts previously capitalized for the years ended December 31, 2018, 2017 and 2016 was $1.3 million, $1.0 million and $0.6 million, respectively.
Accumulated Other Comprehensive Loss	Accumulated Other Comprehensive Loss Comprehensive loss and its components encompass all changes in equity other than those with stockholders, and include net loss, unrealized gains and losses on available-for-sale marketable securities. As of December 31, 2018, and 2017, accumulated other comprehensive loss consisted of $0.6 million and $0.8 million of unrealized losses on available-for-sale marketable securities. See Note 5 for additional disclosures related to change in net unrealized losses and reclassifications out of accumulated other comprehensive loss upon the sale of available-for-sale marketable securities.
Property and Equipment	Property and Equipment Property and equipment, including purchased and internally developed software, are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, which are generally three to five years. Leasehold improvements are amortized using the straight-line method over the estimated useful lives of the assets or the remaining term of the lease, whichever is shorter. The Company periodically reviews the depreciable lives assigned to property and equipment placed in service and change the estimates of useful lives to reflect the results of such reviews.
Impairment of Long-lived Assets	Impairment of Long-lived Assets The Company periodically evaluates its long-lived assets for indicators of possible impairment when events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. The Company then compares the carrying amounts of the assets with the future net undiscounted cash flows expected to be generated by such asset. Should an impairment exist, the impairment loss would be measured based on the excess carrying value of the asset over the asset’s fair value determined using discounted estimates of future cash flows. See Note 6 for more detail about assets impairment.
Inventory	Inventory Inventory is valued at the lower of the standard cost, which approximates actual cost, or market. Cost is determined using the first-in, first-out ("FIFO") method. Inventory consists entirely of supplies, which are consumed when providing its test reports, and therefore does not maintain any finished goods inventory. The Company enters into inventory purchases and commitments so that it can meet future delivery schedules based on forecasted demand for its tests. The Company recorded inventory obsolescence charges totaling $0.3 million, $0.5 million, and $2.1 million in the years ended December 31, 2018, 2017, and 2016, respectively.
Recent Accounting Pronouncements	Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (the “FASB”) under its accounting standard codifications (“ASC”) or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed below, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption. Recently Adopted Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, which amends the existing accounting standards for revenue recognition. ASU 2014-09, which defines the core principles of Accounting Standards Codification Topic 606 (“ASC 606”), establishes principles for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. ASC 606 also impacts the accounting for costs incurred in obtaining a contract with a customer, provided that such costs are considered incremental and recoverable by the Company. Effective January 1, 2018, the Company adopted ASC 606 using the full retrospective approach. The Company revised the financial results in its statements of operations and comprehensive loss for the years ended December 31, 2017 and 2016, respectively, and balance sheet as of December 31, 2017, as if ASC 606 had been effective for those periods. The adoption of ASC 606 resulted in a cumulative-effect adjustment of approximately $41.7 million recorded retroactively to accumulated deficit as of December 31, 2015. The impact of adopting the new guidance on total revenues for the years ended December 31, 2017 and 2016 was a decrease of $1.3 million and $4.6 million, respectively. For financial statement disclosure purposes, the Company elected one of the practical expedients under ASC 606 to forego disclosures related to the allocation of consideration to the remaining performance obligations and the timing in which revenues will be recognized from such performance obligations. Upon the adoption of ASC 606, the Company revised the following selected amounts in its consolidated balance sheet from amounts previously reported: December 31, 2017 As Previously Adoption of Reported ASC 606 As Revised (in thousands) Accounts receivable, net of allowance $ 8,252 $ 35,837 $ 44,089 Other accrued liabilities 33,207 50 33,257 Accumulated deficit $ (482,162) $ 35,787 $ (446,375) Upon the adoption of ASC 606, the Company restated the following selected amounts in its consolidated statements of operations and comprehensive loss from amounts previously reported: Year ended December 31, 2017 As Previously Adoption of Reported ASC 606 As Revised (in thousands) Product revenues $ 205,489 $ (1,712) $ 203,777 Licensing and other revenues 5,450 398 5,848 Total revenues 210,939 (1,314) 209,625 Loss from operations (134,027) (1,314) (135,341) Net loss (136,314) (1,314) (137,628) Net loss per share: Basic $ (2.56) $ (0.02) $ (2.58) Diluted $ (2.56) $ (0.03) $ (2.59) Year ended December 31, 2016 As Previously Adoption of Reported ASC 606 As Revised (in thousands) Product revenues $ 213,968 $ (4,562) $ 209,406 Licensing and other revenues 3,106 — 3,106 Total revenues 217,074 (4,562) 212,512 Loss from operations (96,488) (4,562) (101,050) Net loss (95,765) (4,562) (100,327) Net loss per share: Basic $ (1.86) $ (0.09) $ (1.95) Diluted $ (1.86) $ (0.09) $ (1.95) The Company restated the following selected amounts in its consolidated statements of cash flows from amounts previously reported as a result of the adoption of ASC 606, as well as the adoption of ASU 2016-18 regarding the new financial statement presentation requirements for restricted cash: Year ended December 31, 2017 As Previously Adoption of Adoption of Reported ASU 2016-18 ASC 606 As Revised (in thousands) Operating activities: Net loss $ (136,314) $ — $ (1,314) $ (137,628) Changes in operating assets and liabilities: Accounts receivable 5,001 — 1,314 6,315 Net cash used in operating activities (96,792) (1,033) — (97,825) Cash, cash equivalents and restricted cash, beginning of period 15,256 1,434 — 16,690 Cash, cash equivalents and restricted cash, end of period $ 12,620 $ 401 $ — $ 13,021 Year ended December 31, 2016 As Previously Adoption of Adoption of Reported ASU 2016-18 ASC 606 As Revised (in thousands) Operating activities: Net loss $ (95,765) $ — $ (4,562) $ (100,327) Changes in operating assets and liabilities: Accounts receivable (8,518) — 4,562 (3,956) Net cash used in operating activities (73,902) (150) — (74,052) Cash, cash equivalents and restricted cash, beginning of period 28,947 1,584 — 30,531 Cash, cash equivalents and restricted cash, end of period $ 15,256 $ 1,434 $ — $ 16,690 In November 2016, the FASB issued Accounting Standards Update No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (“ASU 2016-18”). The new guidance requires restricted cash to be combined with cash and cash equivalents when reconciling the beginning and ending balances of cash on the statement of cash flows. Further, the new guidance requires the nature of the restrictions to be disclosed, as well as a reconciliation between the balance sheet and the statement of cash flows on how restricted and unrestricted cash are segregated. The Company adopted this new guidance beginning January 1, 2018 and retroactively adjusted the statements of cash flows for the years ended December 31, 2017 and 2016 to show the combined result of cash and cash equivalents and restricted cash. In August 2016, the FASB issued Accounting Standards Update No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (A Consensus of the Emerging Issues Task Force) (“ASU 2016-15”) . The purpose of ASU 2016-15 is to limit diversity in the classification of certain transactions in the statement of cash flows. Such transactions include (1) debt prepayment or debt extinguishment costs, (2) settlement of zero-coupon bonds, (3) contingent consideration payments made after a business combination, (4) proceeds from insurance claims settlement, (5) proceeds from settlement of life insurance policies, and (6) distributions of equity method investments. The Company adopted this new guidance beginning January 1, 2018, which did not result in a material impact on its financial statements as none of the transactions described above occurred during the year ended December 31, 2018. In May 2017, the FASB issued Accounting Standards Update No. 2017-09 (“ASU 2017-09”), Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting . The purpose of this ASU is to clarify when to account for a change to the terms or conditions of a share-based payment award as a modification. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions, or the classification of the award (as equity or liability) changes as a result of the change in terms or conditions. The Company adopted this new guidance beginning January 1, 2018, and the impact on its financial statements was not material upon adoption. New Accounting Pronouncements Not Yet Adopted In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (“ASU 2016-02”). ASU 2016-02 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. In July 2018, the FASB also issued ASU 2018-11, Leases (Topic 842): Targeted Improvements , which provides an alternative by allowing a cumulative-effect adjustment to be recorded in the opening retained earnings balance as of January 1, 2019 instead of the earliest period presented, and can be adopted concurrently with ASU 2016-02. These two accounting standard updates are collectively known as ASC 842. In preparation for a proper transition to ASC 842, the Company has designated a project implementation team to assess the scope of the accounting and explore opportunities to reduce the extent and complexity of such work by utilizing certain practical expedients under the new guidance. Upon the election of such practical expedients, the Company will be allowed to forego reassessment of the lease classification of an expired or existing lease agreement, whether an expired or existing agreement contains a lease, exclude any lease agreement with a term less than 12 months from the transition, and record a cumulative-effect adjustment as of the effective date of January 1, 2019 instead of the earliest period presented in the financial statements. The Company is in the process of finalizing its analysis and expects the amounts to be recorded for its right-of-use assets and corresponding lease liabilities to be material upon the adoption of ASC 842 using the modified retrospective approach. In June 2016, the FASB issued Accounting Standards Update No. 2016-13, Financial Instruments—Credit Losses: Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 requires measurement and recognition of expected credit losses for financial assets by requiring an allowance to be recorded as an offset to the amortized cost of such assets. For available-for-sale debt securities, expected credit losses should be estimated when the fair value of the debt securities is below their associated amortized costs. ASU 2016-13 will become effective for the Company in the first quarter of 2020, with early adoption permitted beginning the first quarter of 2019. The modified retrospective approach should be applied upon adoption of this new guidance. The Company is currently evaluating the impact of adopting ASU 2016-13 on its financial statements. In February 2018, the FASB issued Accounting Standards Update No. 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (“ASU 2018-02”) . This new guidance was established as a result of the Tax Cuts and Jobs Act passed in December 2017, which provides an opportunity for entities to reclassify residual income tax effects from accumulated other comprehensive income to retained earnings due to the reduction of the corporate income tax rate. The new guidance will be effective in the first quarter of 2019, and interim periods within that year, with early adoption permitted. The Company will have the option to apply this new guidance using either the full retrospective approach or to record the reclassifications as of the beginning date in the period of adoption. The Company does not expect the impact of adopting ASU 2018-02 to be material to its financial statements given that the deferred tax assets are fully reserved by a valuation allowance as of December 31, 2018. In June 2018, the FASB issued Accounting Standards Update No. 2018-07, Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”). ASU 2018-07 is intended to reduce the cost and complexity and to improve financial reporting for nonemployee share-based payments. ASU 2018-07 expands the scope of Topic 718, Compensation—Stock Compensation (which currently only includes share-based payments to employees) to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. ASU 2018-07 supersedes Subtopic 505-50, Equity-Based Payments to Non-Employees . ASU 2018-07 is effective for the Company for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year and early adoption is permitted. The Company does not expect the impact of adopting this new guidance to be material to its financial statements. In August 2018, the FASB issued Accounting Standards Update No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). ASU 2018-13 proposes new disclosure requirements for unrealized gains or losses recognized in other comprehensive income that are attributable to fair value changes in assets and liabilities categorized within Level III of the fair value hierarchy, as well as quantitative information about significant unobservable inputs used to value such assets and liabilities. It eliminates the requirement to disclose the reasons for the transfers of assets and liabilities measured in fair value on a recurring basis between Level I and Level II. ASU 2018-13 is effective for the Company for fiscal years beginning after December 15, 2019, including interim periods within that fiscal year, with early adoption permitted. The Company is currently assessing the impact of this standard on its consolidated financial statements. In August 2018, the SEC adopted amendments to certain disclosure requirements in Securities Act Release No. 33-10532, Disclosure Update and Simplification . These amendments eliminate, modify, or integrate into other SEC requirements certain disclosure rules. Among the amendments is the requirement to present an analysis of changes in stockholders’ equity in the interim financial statements included in quarterly reports on Form 10-Q. The analysis, which can be presented as a footnote or separate statement, is required for the current and comparative quarter and year-to-date interim periods. The amendments are effective for all filings made on or after November 5, 2018. In light of the anticipated timing of effectiveness of the amendments and expected proximity of effectiveness to the filing date for most filers’ quarterly reports, the SEC’s Division of Corporate Finance issued a Compliance and Disclosure Interpretation related to Exchange Act Forms, or CDI – Question 105.09, that provides transition guidance related to this disclosure requirement. CDI – Question 105.09 states that the SEC would not object if the filer’s first presentation of the changes in shareholders’ equity is included in its Form 10-Q for the quarter that begins after the effective date of the amendments. As such, the Company adopted these SEC amendments on November 5, 2018 and will present the analysis of changes in stockholders’ equity in its interim financial statements in its March 31, 2019 Form 10-Q. The Company does not anticipate that the adoption of these SEC amendments will have a material effect on the Company’s financial position, results of operations, cash flows or shareholders’ equity. In November 2018, the FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606 , which clarifies that certain transactions between participants in a collaborative arrangement should be accounted for under ASC 606 when the counterparty is a customer. In addition, Topic 808 precludes an entity from presenting consideration from a transaction in a collaborative arrangement as revenue from contracts with customers if the counterparty is not a customer for that transaction. This guidance will be effective for the Company beginning January 1, 2020. The Company is currently evaluating the impact of the adoption of this standard on its consolidated financial statements.

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)	12 Months Ended
	Dec. 31, 2018
Accounting Standards Update 2014-09
Summary Of Significant Accounting Policies [Line Items]
Schedule of cumulative-effect adjustment	Upon the adoption of ASC 606, the Company revised the following selected amounts in its consolidated balance sheet from amounts previously reported: December 31, 2017 As Previously Adoption of Reported ASC 606 As Revised (in thousands) Accounts receivable, net of allowance $ 8,252 $ 35,837 $ 44,089 Other accrued liabilities 33,207 50 33,257 Accumulated deficit $ (482,162) $ 35,787 $ (446,375) Upon the adoption of ASC 606, the Company restated the following selected amounts in its consolidated statements of operations and comprehensive loss from amounts previously reported: Year ended December 31, 2017 As Previously Adoption of Reported ASC 606 As Revised (in thousands) Product revenues $ 205,489 $ (1,712) $ 203,777 Licensing and other revenues 5,450 398 5,848 Total revenues 210,939 (1,314) 209,625 Loss from operations (134,027) (1,314) (135,341) Net loss (136,314) (1,314) (137,628) Net loss per share: Basic $ (2.56) $ (0.02) $ (2.58) Diluted $ (2.56) $ (0.03) $ (2.59) Year ended December 31, 2016 As Previously Adoption of Reported ASC 606 As Revised (in thousands) Product revenues $ 213,968 $ (4,562) $ 209,406 Licensing and other revenues 3,106 — 3,106 Total revenues 217,074 (4,562) 212,512 Loss from operations (96,488) (4,562) (101,050) Net loss (95,765) (4,562) (100,327) Net loss per share: Basic $ (1.86) $ (0.09) $ (1.95) Diluted $ (1.86) $ (0.09) $ (1.95) The Company restated the following selected amounts in its consolidated statements of cash flows from amounts previously reported as a result of the adoption of ASC 606, as well as the adoption of ASU 2016-18 regarding the new financial statement presentation requirements for restricted cash: Year ended December 31, 2017 As Previously Adoption of Adoption of Reported ASU 2016-18 ASC 606 As Revised (in thousands) Operating activities: Net loss $ (136,314) $ — $ (1,314) $ (137,628) Changes in operating assets and liabilities: Accounts receivable 5,001 — 1,314 6,315 Net cash used in operating activities (96,792) (1,033) — (97,825) Cash, cash equivalents and restricted cash, beginning of period 15,256 1,434 — 16,690 Cash, cash equivalents and restricted cash, end of period $ 12,620 $ 401 $ — $ 13,021 Year ended December 31, 2016 As Previously Adoption of Adoption of Reported ASU 2016-18 ASC 606 As Revised (in thousands) Operating activities: Net loss $ (95,765) $ — $ (4,562) $ (100,327) Changes in operating assets and liabilities: Accounts receivable (8,518) — 4,562 (3,956) Net cash used in operating activities (73,902) (150) — (74,052) Cash, cash equivalents and restricted cash, beginning of period 28,947 1,584 — 30,531 Cash, cash equivalents and restricted cash, end of period $ 15,256 $ 1,434 $ — $ 16,690
Accounting Standards Update 2016-18
Summary Of Significant Accounting Policies [Line Items]
Schedule of reconciliation of restricted cash	December 31, December 31, December 31, December 31, 2018 2017 2016 2015 (in thousands) Cash and cash equivalents in balance sheet $ 46,407 $ 12,620 $ 15,256 $ 28,947 Restricted cash, current portion in balance sheet 4,597 59 1,092 901 Restricted cash in other assets in balance sheet — 342 342 683 Total cash, cash equivalents and restricted cash in statements of cash flows $ 51,004 $ 13,021 $ 16,690 $ 30,531
Schedule of cumulative-effect adjustment	The Company restated the following selected amounts in its consolidated statements of cash flows from amounts previously reported as a result of the adoption of ASC 606, as well as the adoption of ASU 2016-18 regarding the new financial statement presentation requirements for restricted cash: Year ended December 31, 2017 As Previously Adoption of Adoption of Reported ASU 2016-18 ASC 606 As Revised (in thousands) Operating activities: Net loss $ (136,314) $ — $ (1,314) $ (137,628) Changes in operating assets and liabilities: Accounts receivable 5,001 — 1,314 6,315 Net cash used in operating activities (96,792) (1,033) — (97,825) Cash, cash equivalents and restricted cash, beginning of period 15,256 1,434 — 16,690 Cash, cash equivalents and restricted cash, end of period $ 12,620 $ 401 $ — $ 13,021 Year ended December 31, 2016 As Previously Adoption of Adoption of Reported ASU 2016-18 ASC 606 As Revised (in thousands) Operating activities: Net loss $ (95,765) $ — $ (4,562) $ (100,327) Changes in operating assets and liabilities: Accounts receivable (8,518) — 4,562 (3,956) Net cash used in operating activities (73,902) (150) — (74,052) Cash, cash equivalents and restricted cash, beginning of period 28,947 1,584 — 30,531 Cash, cash equivalents and restricted cash, end of period $ 15,256 $ 1,434 $ — $ 16,690

Revenue Recognition (Tables)

Revenue Recognition (Tables)	12 Months Ended
	Dec. 31, 2018
Revenue Recognition
Schedule of disaggregation of revenue by test families	Year Ended December 31, 2018 2017 2016 (Amounts in thousands) (As Revised) (As Revised) Sales of genetic tests Panorama NIPT $ 140,932 $ 128,896 $ 140,582 HCS 87,171 63,467 56,417 Other genetic tests 12,263 11,414 12,407 Product revenues 240,366 203,777 209,406 Licensing and other Constellation 4,844 4,229 3,106 Qiagen 5,794 — — Other 6,650 1,619 — Licensing and other revenues 17,288 5,848 3,106 Total revenues $ 257,654 $ 209,625 $ 212,512
Schedule of disaggregation of revenue by payer types	Year Ended December 31, 2018 2017 2016 (Amounts in thousands) (As Revised) (As Revised) Insurance carriers $ 193,895 $ 163,861 $ 157,570 Laboratory partners 44,062 36,001 46,129 Patients 19,697 9,763 8,813 Total revenues $ 257,654 $ 209,625 $ 212,512
Schedule of total revenue by geographic area	Year ended December 31, 2018 2017 2016 (Amounts in thousands) (As Revised) (As Revised) United States $ 225,931 $ 185,533 $ 188,492 Americas, excluding U.S. 3,472 3,028 2,562 Europe, Middle East, India, Africa 20,866 13,998 14,256 Other 7,385 7,066 7,202 Total $ 257,654 $ 209,625 $ 212,512
Schedule of beginning and ending balances of accounts receivable and deferred revenues	Balance at Balance at December 31, December 31, 2018 2017 (Amounts in thousands) (As Revised) Assets: Accounts receivable $ 62,223 $ 44,089 Liabilities: Deferred revenue, current portion $ 4,131 $ 1,420 Deferred revenue, long-term portion 40,058 — Total deferred revenues $ 44,189 $ 1,420
Schedule of changes in the balance of deferred revenues	Deferred Revenues (in thousands) Balance at December 31, 2017 $ 1,420 Increase in deferred revenues 43,481 Revenue recognized during the period that was included in (712) Balance at December 31, 2018 $ 44,189

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	12 Months Ended
	Dec. 31, 2018
Summary of financial assets and liabilities measured on recurring basis	December 31, 2018 December 31, 2017 Level I Level II Level III Total Level I Level II Level III Total (in thousands) Financial Assets: Money market deposits $ 26,539 $ — $ — $ 26,539 $ 3,477 $ — $ — $ 3,477 U.S. Treasury securities 75,685 — — 75,685 67,026 — — 67,026 U.S. agency securities — 12,891 — 12,891 — 27,072 — 27,072 Municipal securities — 18,885 — 18,885 — 12,149 — 12,149 Total financial assets $ 102,224 $ 31,776 $ — $ 134,000 $ 70,503 $ 39,221 $ — $ 109,724 Current Liabilities: Warrants $ $ — $ — $ — $ — $ — $ 2,644 $ 2,644 Total financial liabilities $ — $ — $ — $ — $ — $ — $ 2,644 $ 2,644
Warrants
Rollforward of fair value determined by Level 3 inputs	Warrants 2018 2017 (in thousands) Beginning balance $ 2,644 $ 3,792 Warrants exercised (6,762) — Change in fair value 4,118 (1,148) Ending balance $ — $ 2,644

Financial Instruments (Tables)

Financial Instruments (Tables)	12 Months Ended
	Dec. 31, 2018
Financial Instruments
Schedule of available-for-sale securities	December 31, 2018 December 31, 2017 Amortized Gross Gross Estimated Fair Amortized Gross Gross Estimated Fair (in thousands) Money market deposits $ 26,539 $ — $ — $ 26,539 $ 3,477 $ — $ — $ 3,477 U.S. Treasury securities 76,061 29 (405) 75,685 67,480 10 (464) 67,026 U.S. agency securities 13,017 — (126) 12,891 27,293 — (221) 27,072 Municipal securities 18,935 7 (57) 18,885 12,240 — (91) 12,149 Total $ 134,552 $ 36 $ (588) $ 134,000 $ 110,490 $ 10 $ (776) $ 109,724 Classified as: Cash equivalents $ 26,539 $ 3,477 Short-term investments 107,461 106,247 Total $ 134,000 $ 109,724
Change in net unrealized positions of available-for-sale securities and reclassifications from AOCL upon sale	December 31, 2018 2017 (in thousands) Balance at beginning of year $ (766) $ (725) Net unrealized gains (losses) on available-for-sale securities, net of tax 171 (105) Reclassifications of losses realized from sale of available-for-sale securities 43 64 Increase (decrease) in other comprehensive loss 214 (41) Balance at end of year $ (552) $ (766)
Summarized portfolio of available-for-sale securities by contractual maturity	December 31, 2018 Amortized Fair (in thousands) Less than one year $ 64,477 $ 64,276 Greater than one year but less than five years 43,536 43,185 Total $ 108,013 $ 107,461

Balance Sheet Components (Table

Balance Sheet Components (Tables)	12 Months Ended
	Dec. 31, 2018
Balance Sheet Components
Schedule of allowance for doubtful accounts	December 31, December 31, December 31, 2018 2017 2016 (in thousands) Beginning balance $ 2,000 $ 1,890 $ 971 Provision for estimated bad debts (41) 143 984 Write offs (171) (33) (65) Ending balance $ 1,788 $ 2,000 $ 1,890
Schedule of property and equipment	December 31, December 31, Useful Life 2018 2017 (in thousands) Machinery and equipment 3-5 years $ 35,400 $ 31,825 Furniture and fixtures 3 years 1,319 1,216 Computer equipment 3 years 2,117 1,958 Capitalized software held for internal use 3 years 4,868 4,465 Leasehold improvements Life of lease 10,916 10,691 Construction-in-process 4,013 6,497 58,633 56,652 Less: Accumulated depreciation and amortization (34,297) (26,985) Total Property and Equipment, net $ 24,336 $ 29,667
Schedule of accrued compensation	December 31, December 31, 2018 2017 (in thousands) Accrued paid time off $ 1,825 $ 1,806 Accrued commissions 4,492 3,558 Accrued bonuses 3,757 2,063 Other accrued compensation 2,594 2,172 Total accrued compensation $ 12,668 $ 9,599
Schedule of other accrued liabilities	December 31, December 31, 2018 2017 (Amounts in thousands) (As Revised) Settlement accrued for reimbursement related claims $ 1,378 $ 10,062 Reserves for refunds to insurance carriers 10,012 6,794 Accrued charges for outsourced testing 5,001 6,566 Testing and laboratory materials from suppliers 2,742 1,367 Marketing and corporate affairs 1,306 1,456 Legal, audit and consulting fees 1,058 206 Accrued shipping charges 852 198 Sales tax payable 1,255 504 Accrued specimen service fees 1,378 683 Accrued rent 903 856 Clinical trials and studies 1,694 483 Other accrued expenses 4,863 4,082 Total other accrued liabilities $ 32,442 $ 33,257

Commitments and Contingencies (

Commitments and Contingencies (Tables)	12 Months Ended
	Dec. 31, 2018
Commitments and Contingencies
Schedule of future minimum lease payments	Operating Leases (in thousands) Year ending December 31: 2019 $ 8,588 2020 8,825 2021 9,067 2022 9,319 2023 7,702 2024 and thereafter 7,130 Total future minimum lease payments $ 50,631

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	12 Months Ended
	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Summary of stock option activity	Outstanding Options Weighted- Weighted- Average Shares Average Remaining Aggregate Available for Number of Exercise Contractual Intrinsic (in thousands, except for contractual life and exercise price) Grant Shares Price Life Value (In years) Balance at December 31, 2017 4,737 9,963 $ 6.54 7.03 $ 31,902 Additional shares authorized 2,161 — Options granted (2,319) 2,319 $ 11.77 Options exercised — (1,967) $ 6.78 Options forfeited 852 (852) $ 7.54 Balance at December 31, 2018 5,431 9,463 $ 7.69 6.91 $ 61,718 Exercisable at December 31, 2018 5,484 $ 5.25 5.57 $ 48,055 Vested and expected to vest at December 31, 2018 9,224 $ 7.60 6.87 $ 60,895
Restricted stock units	Weighted- Average Number of Grant Date Shares Fair Value Balance at December 31, 2017 389 $ 10.38 Granted 953 $ 11.86 Vested (177) $ 13.84 Canceled/Forfeited (81) $ 9.91 Balance at December 31, 2018 1,084 $ 11.72
Summary of stock-based compensation expenses	Year ended December 31, 2018 2017 2016 Employee Non-Employee Total Employee Non-Employee Total Employee Non-Employee Total (in thousands) Cost of revenues $ 564 $ 5 $ 569 $ 544 $ — $ 544 $ 651 $ (10) $ 641 Research and development 4,043 — 4,043 3,214 — 3,214 2,829 24 2,853 Selling, general and administrative 9,474 112 9,586 7,644 — 7,644 6,837 270 7,107 Total $ 14,081 $ 117 $ 14,198 $ 11,402 $ — $ 11,402 $ 10,317 $ 284 $ 10,601
Employee stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Schedule of assumptions used in valuation of fair value of employee stock options	Year ended December 31, 2018 2017 2016 Expected term (years) 5.24 — 5.62 5.14 — 5.24 5.10 — 5.20 Expected volatility 40.28 % — 42.53 % 40.75 % — 62.93 % 63.06 % — 72.49 % Expected dividend rate 0 % 0 % 0 % Risk-free interest rate 2.37 % — 3.06 % 1.67 % — 2.16 % 0.97 % — 1.92 %
Non-employee stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Schedule of assumptions used in valuation of fair value of employee stock options	Year ended December 31, 2018 2017 2016 Expected term (years) 2.72 — 2.76 2.67 — 2.71 2.65 — 3.16 Expected volatility 41.36 % — 43.84 % 41.22 % — 52.18 % 50.90 % — 72.61 % Expected dividend rate 0 % 0 % 0 % Risk-free interest rate 2.36 % — 2.86 % 1.42 % — 1.95 % 0.68 % — 1.38 %

Debt (Tables)

Debt (Tables)	12 Months Ended
	Dec. 31, 2018
Debt
Schedule of long-term debt	December 31, December 31, 2018 2017 (Amounts in thousands) Debt principal balance $ 75,000 $ 75,000 Less: unamortized debt discount (1,643) (1,935) Net carrying amount at end of period $ 73,357 $ 73,065

Income Taxes (Tables)

Income Taxes (Tables)	12 Months Ended
	Dec. 31, 2018
Income Taxes
Schedule of effective tax rates differing from U.S. federal statutory rate	Year Ended December 31, 2018 2017 2016 (in thousands, except percentages) U.S. federal taxes (benefit) at statutory rate $ (26,800) % $ (46,206) % $ (32,277) % State tax expense (4,468) % (6,559) % (2,842) % Research and development credits (1,164) % (1,149) % (1,449) % Stock-based compensation (3,148) % (5,036) % 1,275 1.34 % Change in federal tax rate — 0.00 % 44,701 32.89 % — % Mark to market fair value adjustments 865 0.68 % (390) % 49 0.05 % Nondeductible settlement for claims 1 0.00 % 3,873 2.85 % — % Other nondeductible items 885 0.69 % 1,009 0.74 % 933 0.99 % Change in valuation allowance 34,150 26.76 % 10,211 7.51 % 34,453 36.29 % Provision for income taxes $ 321 0.25 % $ 454 0.31 % $ 142 0.15 %
Schedule of tax effects of temporary differences that give rise to significant portions of the deferred tax assets	December 31, 2018 2017 (in thousands) Deferred tax assets: Net operating loss carryforwards $ 95,321 $ 77,356 Research and development tax credit carryforwards 15,632 12,675 Reserves and accruals 7,922 3,404 Stock-based compensation 4,076 2,929 Total deferred tax assets before valuation allowance 122,951 96,364 Less: valuation allowance (122,441) (95,817) 510 547 Deferred tax liabilities: Property and equipment (510) (547) Net deferred tax assets $ — $ —
Schedule of reconciliation of the beginning and ending amount of gross unrecognized tax benefits	Year Ended December 31, 2018 2017 2016 (in thousands) Balance at beginning of year $ 5,945 $ 4,293 $ 2,405 Additions based on tax positions related to the current year 1,416 1,651 1,836 Additions for tax positions of prior years 1 1 52 Balance at end of year $ 7,362 $ 5,945 $ 4,293

Net Loss per Share (Tables)

Net Loss per Share (Tables)	12 Months Ended
	Dec. 31, 2018
Net Loss per Share
Basic and diluted net loss per common share	Year ended December 31, (in thousands, except per share data) 2018 2017 2016 (As Revised) (As Revised) Numerator: Net loss used to compute net loss per share, basic $ (128,154) $ (137,628) $ (100,327) Less: Remeasurement gain on warrant liability — (1,148) — Net loss used to compute net loss per share, diluted $ (128,154) $ (138,776) $ (100,327) Denominator: Weighted-average common shares outstanding 57,848 53,312 51,667 Less: Weighted-average unvested common shares subject to repurchase — — (91) Weighted-average number of shares used in computing net loss per share, basic 57,848 53,312 51,576 Add: Incremental shares from assumed exercise of warrants — 292 — Weighted-average number of shares used in computing net loss per share, diluted 57,848 53,604 51,576 Net loss per share, basic $ (2.22) $ (2.58) $ (1.95) Net loss per share, diluted $ (2.22) $ (2.59) $ (1.95)
Total outstanding potentially dilutive shares not included in the calculation of dilutive EPS	As of December 31, 2018 2017 2016 Options to purchase common stock 9,463 9,963 9,043 Warrants to purchase common stock — — 377 Restricted stock units 1,084 389 159 Employee stock purchase plan 42 79 90 10,589 10,431 9,669

Quarterly Financial Data (Table

Quarterly Financial Data (Tables)	12 Months Ended
	Dec. 31, 2018
Quarterly Financial Data
Schedule of quarterly financial data	Three months ended December 31, September 30, June 30, March 31, (in thousands, except per share data) 2018 Operating results: Total revenues $ 66,965 $ 65,280 $ 63,069 $ 62,340 Cost of product revenues 40,345 39,477 39,204 39,055 Cost of licensing and other revenues 2,444 2,202 1,791 1,537 Gross profit 24,176 23,601 22,074 21,748 Operating expenses 53,903 50,767 49,292 52,265 Interest expense and other (expense) income, net (2,128) (2,332) (6,493) (2,252) Income tax expense 14 (118) (113) (104) Net loss $ (31,841) $ (29,616) $ (33,824) $ (32,873) Per share data: Net loss - basic $ (0.51) $ (0.49) $ (0.62) $ (0.61) Net loss - diluted $ (0.51) $ (0.49) $ (0.62) $ (0.61) 2017 (As Revised) Operating results: Total revenues $ 52,050 $ 55,910 $ 52,283 $ 49,382 Cost of product revenues 35,153 33,558 33,709 33,088 Cost of licensing and other revenues 1,572 1,054 850 612 Gross profit 15,325 21,298 17,724 15,682 Operating expenses 61,956 47,087 46,095 50,232 Interest expense and other (expense) income, net (405) (1,914) (631) 1,117 Income tax expense (181) (162) (64) (47) Net loss $ (47,217) $ (27,865) $ (29,066) $ (33,480) Per share data: Net loss - basic $ (0.88) $ (0.52) $ (0.55) $ (0.63) Net loss - diluted $ (0.90) $ (0.52) $ (0.55) $ (0.65)

Description of Business (Detail

Description of Business (Details)	12 Months Ended
	Dec. 31, 2018segment
Description of Business
Number of operating segments	1

Summary of Significant Accoun_4

Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Aug. 31, 2017	Aug. 08, 2017	Dec. 31, 2015
Policies
Net (loss) income	$ (31,841)	$ (29,616)	$ (33,824)	$ (32,873)	$ (47,217)	$ (27,865)	$ (29,066)	$ (33,480)	$ (128,154)	$ (137,628)	$ (100,327)
Accumulated deficit	574,529				446,375				574,529	446,375
Cash and cash equivalents	46,407				12,620				46,407	12,620	15,256			$ 28,947
Marketable securities	107,461				106,247				107,461	106,247
Short-term Credit Line, outstanding balance	50,153				50,112				50,153	50,112
Long-term Term Loan, carrying amount	73,357				73,065				73,357	73,065
Total revenues	66,965	$ 65,280	$ 63,069	$ 62,340	52,050	$ 55,910	$ 52,283	$ 49,382	$ 257,654	209,625	$ 212,512
Agreement term									4 years
Restricted cash
Restricted cash, long term portion					342					342
2017 Term Loan
Policies
Long-term Term Loan, carrying amount	73,357				$ 73,065				$ 73,357	$ 73,065
Remaining borrowing capacity	$ 50,000								$ 50,000			$ 50,000	$ 25,000
Qiagen
Policies
Agreement term									10 years

Summary of Significant Accoun_5

Summary of Significant Accounting Policies - Offering (Details) - USD ($) $ / shares in Units, $ in Millions	1 Months Ended
	Jul. 31, 2018	Dec. 31, 2018	Dec. 31, 2017
Common stock, shares issued		62,082,348	54,040,000
July 2018 Offering
Common stock, shares issued	4,500,000
Stock issued (in dollars per share)	$ 20
Option for additional shares
Common stock, shares issued	675,000
July 2018 Offering inclusive of option for additional shares
Proceeds from issuance of common stock	$ 97.3
Payment of offering costs	$ 0.5

Summary of Significant Accoun_6

Summary of Significant Accounting Policies Restricted Cash (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Cash and cash equivalents in balance sheet	$ 46,407	$ 12,620	$ 15,256	$ 28,947
Restricted cash, current portion in balance sheet	4,597	59	1,092	901
Restricted cash in other assets in balance sheet		342	342	683
Total cash, cash equivalents and restricted cash in statements of cash flows	51,004	13,021	16,690	30,531
Accounting Standards Update 2016-18
Total cash, cash equivalents and restricted cash in statements of cash flows		$ 401	$ 1,434	$ 1,584
Letter of Credit
Restricted cash, current portion in balance sheet	4,200
Deposit per credit card terms
Restricted cash, current portion in balance sheet	$ 300

Summary of Significant Accoun_7

Summary of Significant Accounting Policies - Concentration (Details) - customer	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Sales | Customer
Risk and Uncertainties
Number of customers exceeding 10% of benchmark	0	0	0
Accounts Receivable | Credit
Risk and Uncertainties
Number of customers exceeding 10% of benchmark	0	0

Summary of Significant Accoun_8

Summary of Significant Accounting Policies - Costs (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Summary of Significant Accounting Policies
Advertising costs	$ 0.2	$ 0.5	$ 0.4
Shipping and handling costs	12.4	9.5	8.2
Capitalized software	1.7	2.6
Amortized expense	$ 1.3	$ 1	$ 0.6

Summary of Significant Accoun_9

Summary of Significant Accounting Policies - AOCL (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Summary of Significant Accounting Policies
Accumulated other comprehensive loss	$ 552	$ 766

Summary of Significant Accou_10

Summary of Significant Accounting Policies - Inventory (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Summary of Significant Accounting Policies
Inventory obsolescence charges	$ 265	$ 502	$ 2,110

Summary of Significant Accou_11

Summary of Significant Accounting Policies - Property (Details)	12 Months Ended
	Dec. 31, 2018
Minimum
Property and Equipment
Estimated useful life	P3Y
Maximum
Property and Equipment
Estimated useful life	P5Y

Summary of Significant Accou_12

Summary of Significant Accounting Policies - Pronouncements (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accounts receivable, net of allowance	$ 62,223				$ 44,089				$ 62,223	$ 44,089
Other accrued liabilities	32,442				33,257				32,442	33,257
Accumulated deficit	(574,529)				(446,375)				(574,529)	(446,375)
Total revenues	66,965	$ 65,280	$ 63,069	$ 62,340	52,050	$ 55,910	$ 52,283	$ 49,382	257,654	209,625	$ 212,512
Loss from operations									(114,628)	(135,341)	(101,050)
Net loss	$ (31,841)	$ (29,616)	$ (33,824)	$ (32,873)	$ (47,217)	$ (27,865)	$ (29,066)	$ (33,480)	$ (128,154)	$ (137,628)	$ (100,327)
Net loss per share (Note 13):
Basic (in dollars per share)	$ (0.51)	$ (0.49)	$ (0.62)	$ (0.61)	$ (0.88)	$ (0.52)	$ (0.55)	$ (0.63)	$ (2.22)	$ (2.58)	$ (1.95)
Diluted (in dollars per share)	$ (0.51)	$ (0.49)	$ (0.62)	$ (0.61)	$ (0.90)	$ (0.52)	$ (0.55)	$ (0.65)	$ (2.22)	$ (2.59)	$ (1.95)
Operating activities
Net loss									$ (128,154)	$ (137,628)	$ (100,327)
Changes in operating assets and liabilities:
Accounts receivable									(18,093)	6,315	(3,956)
Net cash (used in) provided by operating activities									(70,581)	(97,825)	(74,052)
Cash, cash equivalents and restricted cash, beginning of period				$ 13,021				$ 16,690	13,021	16,690	30,531
Cash, cash equivalents and restricted cash, end of period	$ 51,004				$ 13,021				51,004	13,021	16,690
Product
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Total revenues									240,366	203,777	209,406
Licensing and other
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Total revenues									17,288	5,848	3,106
Adjustment
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Loss from operations									10,200
Accounting Standards Update 2016-18
Changes in operating assets and liabilities:
Net cash (used in) provided by operating activities										(1,033)	(150)
Cash, cash equivalents and restricted cash, beginning of period				401				1,434	401	1,434	1,584
Cash, cash equivalents and restricted cash, end of period					401					401	1,434
As Previously Reported
Operating activities
Net loss										(136,314)	(95,765)
Changes in operating assets and liabilities:
Accounts receivable										5,001	(8,518)
Net cash (used in) provided by operating activities										(96,792)	(73,902)
Cash, cash equivalents and restricted cash, beginning of period				$ 12,620				$ 15,256	$ 12,620	15,256	28,947
Cash, cash equivalents and restricted cash, end of period					12,620					12,620	15,256
As Previously Reported | Accounting Standards Update 2014-09
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accounts receivable, net of allowance					8,252					8,252
Other accrued liabilities					33,207					33,207
Accumulated deficit					(482,162)					(482,162)
Total revenues										210,939	217,074
Loss from operations										(134,027)	(96,488)
Net loss										$ (136,314)	$ (95,765)
Net loss per share (Note 13):
Basic (in dollars per share)										$ (2.56)	$ (1.86)
Diluted (in dollars per share)										$ (2.56)	$ (1.86)
As Previously Reported | Accounting Standards Update 2014-09 | Product
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Total revenues										$ 205,489	$ 213,968
As Previously Reported | Accounting Standards Update 2014-09 | Licensing and other
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Total revenues										5,450	3,106
Adoption of ASC 606
Operating activities
Net loss										(1,314)	(4,562)
Changes in operating assets and liabilities:
Accounts receivable										1,314	4,562
Adoption of ASC 606 | Accounting Standards Update 2014-09
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accounts receivable, net of allowance					35,837					35,837
Other accrued liabilities					50					50
Accumulated deficit					$ 35,787					35,787
Total revenues										(1,314)	(4,562)
Loss from operations										(1,314)	(4,562)
Net loss										$ (1,314)	$ (4,562)
Net loss per share (Note 13):
Basic (in dollars per share)										$ (0.02)	$ (0.09)
Diluted (in dollars per share)										$ (0.03)	$ (0.09)
Adoption of ASC 606 | Accounting Standards Update 2014-09 | Product
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Total revenues										$ (1,712)	$ (4,562)
Adoption of ASC 606 | Accounting Standards Update 2014-09 | Licensing and other
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Total revenues										398
Adoption of ASC 606 | Accounting Standards Update 2014-09 | Adjustment
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect adjustment												$ 41,700
Total revenues										$ (1,300)	$ (4,600)

Revenue Recognition (Details)

Revenue Recognition (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Revenue recognized									$ 3,300
Agreement term									4 years
Deferred revenue, noncurrent	$ 40,058								$ 40,058
Deferred revenue	44,189				$ 1,420				44,189	$ 1,420
Deferred revenue, current portion	4,131				1,420				4,131	1,420
Total revenues	66,965	$ 65,280	$ 63,069	$ 62,340	52,050	$ 55,910	$ 52,283	$ 49,382	257,654	209,625	$ 212,512
Deferred revenue, long-term portion	40,058								40,058
Deferred revenue, current portion	4,131				$ 1,420				4,131	1,420
Product
Revenue recognized									3,300	4,900	0
Total revenues									240,366	203,777	209,406
Licensing and other
Total revenues									17,288	$ 5,848	$ 3,106
Evercord
Deferred revenue, noncurrent	2,900								2,900
Deferred revenue, current portion	2,100								2,100
Deferred revenue, long-term portion	2,900								2,900
Deferred revenue, current portion	2,100								$ 2,100
Evercord | Processing and storage services | Minimum
Billing collection period (in months)									6 months
Evercord | Processing and storage services | Maximum
Billing collection period (in months)									18 months
Evercord | Processing and storage services | Alternate
Billing collection period (in months)									12 months
Qiagen
Revenue recognized				$ 5,500					$ 5,800
Agreement term									10 years
Revenue, remaining performance obligation	9,200								$ 9,200
Deferred revenue, noncurrent	37,200								37,200
Initial transaction price	15,000								15,000
Deferred revenue, current portion	2,000								2,000
Deferred revenue, long-term portion	37,200								37,200
Deferred revenue, current portion	2,000								2,000
Qiagen | License fee
Revenue, remaining performance obligation	$ 40,000								$ 40,000

Revenue Recognition - Disaggreg

Revenue Recognition - Disaggregation (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Disaggregation of Revenue [Line Items]
Total revenues	$ 66,965	$ 65,280	$ 63,069	$ 62,340	$ 52,050	$ 55,910	$ 52,283	$ 49,382	$ 257,654	$ 209,625	$ 212,512
Previously delivered tests, revenue recognized									10,200
Decrease to loss from operations									(114,628)	(135,341)	(101,050)
Adjustment
Disaggregation of Revenue [Line Items]
Decrease to loss from operations									$ 10,200
Net loss per share, basic and diluted (in dollars per share)									$ 0.18
United States
Disaggregation of Revenue [Line Items]
Total revenues									$ 225,931	185,533	188,492
Americas, excluding U.S.
Disaggregation of Revenue [Line Items]
Total revenues									3,472	3,028	2,562
Europe, Middle East, India, and Africa
Disaggregation of Revenue [Line Items]
Total revenues									20,866	13,998	14,256
Other
Disaggregation of Revenue [Line Items]
Total revenues									7,385	7,066	7,202
Insurance carriers
Disaggregation of Revenue [Line Items]
Total revenues									193,895	163,861	157,570
Laboratory partners
Disaggregation of Revenue [Line Items]
Total revenues									44,062	36,001	46,129
Patients
Disaggregation of Revenue [Line Items]
Total revenues									19,697	9,763	8,813
Panorama NIPT
Disaggregation of Revenue [Line Items]
Total revenues									140,932	128,896	140,582
HCS
Disaggregation of Revenue [Line Items]
Total revenues									87,171	63,467	56,417
Other genetic tests
Disaggregation of Revenue [Line Items]
Total revenues									12,263	11,414	12,407
Product
Disaggregation of Revenue [Line Items]
Total revenues									240,366	203,777	209,406
Constellation
Disaggregation of Revenue [Line Items]
Total revenues									4,844	4,229	3,106
Qiagen
Disaggregation of Revenue [Line Items]
Total revenues									5,794
Other product
Disaggregation of Revenue [Line Items]
Total revenues									6,650	1,619
Licensing and other
Disaggregation of Revenue [Line Items]
Total revenues									$ 17,288	$ 5,848	$ 3,106

Revenue Recognition - Accounts

Revenue Recognition - Accounts Receivable and Deferred Revenue (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Assets
Accounts receivable, net of allowance	$ 62,223	$ 44,089
Liabilities:
Deferred revenue, current portion	4,131	1,420
Deferred revenue, long-term portion	40,058
Total deferred revenues	44,189	1,420
Current accounts receivable	62,223	44,089
Other noncurrent assets	3,317	$ 3,979
Evercord
Liabilities:
Deferred revenue, current portion	2,100
Deferred revenue, long-term portion	2,900
Noncurrent accounts receivable	500
Evercord | Processing and storage services
Assets
Accounts receivable, net of allowance	$ 3,400
Liabilities:
Prepayment plan, delivery duration (in years)	18 years
Accounts receivable	$ 3,900
Current accounts receivable	3,400
Noncurrent accounts receivable	500
Other noncurrent assets	$ 500
Evercord | Processing and storage services | Alternate
Liabilities:
Billing collection period (in months)	12 months
Evercord | Processing and storage services | Minimum
Liabilities:
Billing collection period (in months)	6 months
Evercord | Processing and storage services | Maximum
Liabilities:
Billing collection period (in months)	18 months

Revenue Recognition - Changes i

Revenue Recognition - Changes in Balance of Deferred Revenues (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2018USD ($)
Balance	$ 1,420
Increase in deferred revenues	43,481
Revenue recognized during the period from performance obligations included in deferred revenues at the beginning of the period	(712)
Revenue recognized from performance obligations that were	10,200
Balance	44,189
Genetic testing services and provision of IVD kits
Revenue recognized during the period from performance obligations included in deferred revenues at the beginning of the period	600
Processing and storage services | Evercord
Revenue recognized during the period from performance obligations included in deferred revenues at the beginning of the period	$ 100

Revenue Recognition - Remaining

Revenue Recognition - Remaining Obligations (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Deferred revenue, current portion	$ 4,131	$ 1,420
Deferred revenue	44,189	$ 1,420
Deferred revenue, noncurrent	40,058
Evercord
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Deferred revenue, current portion	2,100
Deferred revenue, noncurrent	2,900
Qiagen
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation	9,200
Deferred revenue, current portion	2,000
Deferred revenue, noncurrent	$ 37,200

Fair Value Measurements - Hiera

Fair Value Measurements - Hierarchy (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Transfers between Levels 1 and 2
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount	$ 0	$ 0
Fair Value, Assets, Level 2 to Level 1 Transfers, Amount	0	0
Fair Value, Liabilities, Level 1 to Level 2 Transfers, Amount	0	0
Fair Value, Liabilities, Level 2 to Level 1 Transfers, Amount	0	0
Transfers into and out of Level 3
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3	0	0
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Transfers out of Level 3	0	0
Fair Value, Measurement with Unobservable Inputs Reconciliation, Liability, Transfers Into Level 3	0	0
Fair Value, Measurement with Unobservable Inputs Reconciliation, Liability, Transfers out of Level 3	0	0
Recurring
Current Liabilities:
Warrants		2,644,000
Total financial liabilities		2,644,000
Recurring | Available-for-sale securities
Financial Assets:
Total financial assets	134,000,000	109,724,000
Recurring | Money market deposits
Financial Assets:
Total financial assets	26,539,000	3,477,000
Recurring | U.S. Treasury securities
Financial Assets:
Total financial assets	75,685,000	67,026,000
Recurring | U.S. agency securities
Financial Assets:
Total financial assets	12,891,000	27,072,000
Recurring | Municipal securities
Financial Assets:
Total financial assets	18,885,000	12,149,000
Recurring | Level 1 | Available-for-sale securities
Financial Assets:
Total financial assets	102,224,000	70,503,000
Recurring | Level 1 | Money market deposits
Financial Assets:
Total financial assets	26,539,000	3,477,000
Recurring | Level 1 | U.S. Treasury securities
Financial Assets:
Total financial assets	75,685,000	67,026,000
Recurring | Level 2 | Available-for-sale securities
Financial Assets:
Total financial assets	31,776,000	39,221,000
Recurring | Level 2 | U.S. agency securities
Financial Assets:
Total financial assets	12,891,000	27,072,000
Recurring | Level 2 | Municipal securities
Financial Assets:
Total financial assets	$ 18,885,000	12,149,000
Recurring | Level 3
Current Liabilities:
Warrants		2,644,000
Total financial liabilities		$ 2,644,000

Fair Value Measurements - Level

Fair Value Measurements - Level III (Details) - Warrants - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance	$ 2,644	$ 3,792
Warrants exercised	(6,762)
Change in fair value	$ 4,118	(1,148)
Ending balance		$ 2,644

Financial Instruments (Details)

Financial Instruments (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2018USD ($)position	Dec. 31, 2017USD ($)	Dec. 31, 2016USD ($)
Available-for-sale Securities, Fair Value to Amortized Cost Basis [Abstract]
Estimated Fair Value	$ 107,461	$ 106,247
Realized gain			$ 200
Other than temporary impairment	$ 0
Number of investments, unrealized loss position | position	16
Interest income	$ 1,800	1,200	$ 1,500
Amortized Cost
Less than one year	64,477
Greater than one year but less than five years	43,536
Total	108,013
Fair Value
Less than one year	64,276
Greater than one year but less than five years	43,185
Total	107,461
Available-for-sale securities
Available-for-sale Securities, Fair Value to Amortized Cost Basis [Abstract]
Cost	134,552	110,490
Unrealized Gain	36	10
Unrealized Loss	(588)	(776)
Estimated Fair Value	134,000	109,724
Money market deposits
Available-for-sale Securities, Fair Value to Amortized Cost Basis [Abstract]
Cost	26,539	3,477
Estimated Fair Value	26,539	3,477
U.S. Treasury securities
Available-for-sale Securities, Fair Value to Amortized Cost Basis [Abstract]
Cost	76,061	67,480
Unrealized Gain	29	10
Unrealized Loss	(405)	(464)
Estimated Fair Value	75,685	67,026
U.S. agency securities
Available-for-sale Securities, Fair Value to Amortized Cost Basis [Abstract]
Cost	13,017	27,293
Unrealized Loss	(126)	(221)
Estimated Fair Value	12,891	27,072
Municipal securities
Available-for-sale Securities, Fair Value to Amortized Cost Basis [Abstract]
Cost	18,935	12,240
Unrealized Gain	7
Unrealized Loss	(57)	(91)
Estimated Fair Value	18,885	12,149
Cash equivalents | Available-for-sale securities
Available-for-sale Securities, Fair Value to Amortized Cost Basis [Abstract]
Estimated Fair Value	26,539	3,477
Short-term investments | Available-for-sale securities
Available-for-sale Securities, Fair Value to Amortized Cost Basis [Abstract]
Estimated Fair Value	$ 107,461	$ 106,247

Financial Instruments - Net Unr

Financial Instruments - Net Unrealized Positions (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Available-for-sale Securities
Net unrealized gains (losses) on available-for-sale securities, net of tax	$ 214	$ (41)	$ 691
Increase (decrease) in other comprehensive loss	214	(41)	691
Available-for-sale securities
Available-for-sale Securities
Balance	(766)	(725)
Net unrealized gains (losses) on available-for-sale securities, net of tax	171	(105)
Reclassifications of losses realized from sale of available-for-sale securities	43	64
Increase (decrease) in other comprehensive loss	214	(41)
Balance	$ (552)	$ (766)	$ (725)

Balance Sheet Components - Allo

Balance Sheet Components - Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Allowance for doubtful accounts
Beginning balance	$ 2,000	$ 1,890	$ 971
Provision for estimated bad debts	(41)	143	984
Write offs	(171)	(33)	(65)
Ending balance	$ 1,788	$ 2,000	$ 1,890

Balance Sheet Components - Prop

Balance Sheet Components - Property (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Property and Equipment, net
Property and equipment, gross	$ 58,633	$ 56,652
Less: Accumulated depreciation and amortization	(34,297)	(26,985)
Total Property and Equipment, net	24,336	29,667
Impairment of assets	1,544	576	$ 2,138
Machinery and equipment
Property and Equipment, net
Property and equipment, gross	35,400	31,825
Machinery and equipment | Cost of product revenues
Property and Equipment, net
Impairment of assets		1,900
Machinery and equipment | General and administrative expense
Property and Equipment, net
Impairment of assets		200
Machinery and equipment | Maintenance service contract
Property and Equipment, net
Impairment of assets		300
Furniture and fixtures
Property and Equipment, net
Property and equipment, gross	$ 1,319	1,216
Useful Life	3 years
Computer equipment
Property and Equipment, net
Property and equipment, gross	$ 2,117	1,958
Useful Life	3 years
Capitalized software held for internal use
Property and Equipment, net
Property and equipment, gross	$ 4,868	4,465
Useful Life	3 years
Leasehold improvements
Property and Equipment, net
Property and equipment, gross	$ 10,916	10,691
Construction-in-process
Property and Equipment, net
Property and equipment, gross	$ 4,013	$ 6,497
Minimum | Machinery and equipment
Property and Equipment, net
Useful Life	3 years
Maximum | Machinery and equipment
Property and Equipment, net
Useful Life	5 years

Balance Sheet Components - Othe

Balance Sheet Components - Other Assets (Details) - USD ($) $ in Thousands	Aug. 08, 2017	Aug. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Aug. 14, 2017	Apr. 30, 2016
Balance Sheet Components [Line Items]
Agreement term			4 years
Total consideration						$ 3,200
Deferred costs included in other long-term assets			$ 1,000	$ 1,800
Amortization of deferred costs			$ 800	$ 800
Common stock, shares issued			62,082,348	54,040,000
Payments of debt issuance costs				$ 287
Amortization of debt discount			$ 391	154
Noncurrent assets			3,317	$ 3,979
2017 Term Loan
Balance Sheet Components [Line Items]
Common stock, shares issued		300,000			300,000
Payments of debt issuance costs	$ 300
Amortization of debt discount			100
Debt discount		$ 2,700	600
Debt, increase (decrease)		(2,000)
Debt instrument, fee amount		2,400
Noncurrent assets		700
Remaining borrowing capacity	$ 25,000	$ 50,000	50,000
Evercord
Balance Sheet Components [Line Items]
Noncurrent accounts receivable			$ 500

Balance Sheet Components - Accr

Balance Sheet Components - Accrued Compensation (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Balance Sheet Components
Accrued paid time off	$ 1,825	$ 1,806
Accrued commissions	4,492	3,558
Accrued bonuses	3,757	2,063
Other accrued compensation	2,594	2,172
Total accrued compensation	$ 12,668	$ 9,599

Balance Sheet Components - Ot_2

Balance Sheet Components - Other Accured Liabilities (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Mar. 31, 2018	Mar. 07, 2018	Dec. 31, 2017
Balance Sheet Components
Settlement accrued for reimbursement related claims	$ 1,378			$ 10,062
Reserves for refunds to third-party payers	10,012			6,794
Accrued charges for outsourced testing	5,001			6,566
Testing and laboratory materials from suppliers	2,742			1,367
Marketing and corporate affairs	1,306			1,456
Legal, audit and consulting fees	1,058			206
Accrued shipping charges	852			198
Sales tax payable	1,255			504
Accrued specimen service fees	1,378			683
Accrued rent	903			856
Clinical trials and studies	1,694			483
Other accrued expenses	4,863			4,082
Total other accrued liabilities	32,442			33,257
Accrued interest	200
Accrued settlement liability	1,400		$ 11,400	11,400
Accrued settlement liability, current				10,100
Accrued settlement liability, long-term				$ 1,300
Settlement agreement, amount plus applicable interest to be paid in installments		$ 5,300	$ 5,300
Quarterly installments	4,200
Quarterly installment, separate amount	800
Additional reserves for refunds to insurance carriers	10,300
Revenue recognized	$ 3,300

Commitments and Contingencies_2

Commitments and Contingencies (Details)	12 Months Ended
	Dec. 31, 2018USD ($)ft²location	Dec. 31, 2017USD ($)	Dec. 31, 2016USD ($)
Future minimum lease payments
2018	$ 8,588,000
2019	8,825,000
2020	9,067,000
2021	9,319,000
2022	7,702,000
2023 and thereafter	7,130,000
Total future minimum lease payment	50,631,000
Rent expense	$ 7,400,000	$ 7,200,000	$ 5,400,000
Corporate Headquarters Lease
Operating Leases
Office space (area) | ft²	136,000
Number of office space locations | location	2
Security Deposit	$ 700,000
Term of lease	84 months
Security deposit	$ 700,000
"First Space" Sublease
Operating Leases
Office space (area) | ft²	88,000
Monthly base rent	$ 319,095
"Second Space" Sublease
Operating Leases
Office space (area) | ft²	48,000
Monthly base rent	$ 190,424
Austin TX, Long-term Lease
Operating Leases
Office space (area) | ft²	94,000
Monthly base rent	$ 100,000
Security Deposit	$ 400,000
Term of lease	132 months
Maximum monthly base rent after escalation	$ 200,000
Security deposit	400,000
Allowance for leasehold improvements	$ 7,800,000
Tukwila, WA lease
Operating Leases
Office space (area) | ft²	10,000
Monthly base rent	$ 11,900
Term of lease	62 months
Percentage of annual increase in rent	3.00%

Commitments and Contingencies -

Commitments and Contingencies - Legal (Details) $ in Millions	Mar. 07, 2018USD ($)installment	Dec. 31, 2018USD ($)	Mar. 31, 2018USD ($)	Dec. 31, 2017USD ($)
Other commitments
Shareholders (as a percent)		5.00%
Accrued settlement liability	$ 11.4	$ 1.4		$ 11.4
Settlement agreement, amount plus applicable interest to be paid in installments	$ 5.3		$ 5.3
Settlement agreement, number of equal quarterly installments | installment	4
Accrued settlement liability, current				10.1
Accrued settlement liability, long-term				$ 1.3
Supplier one | Inventory material
Other commitments
Purchase commitment		8.9
Supplier two | Inventory material
Other commitments
Purchase commitment		5.3
Supplier three | Gene sequencing data analysis commitment
Other commitments
Purchase commitment		2.1
Supplier Four | Biological sample processing and storage
Other commitments
Purchase commitment		0.5
Supplier Five | Diagnostic reagents
Other commitments
Purchase commitment		2
Securities related claims
Other commitments
Estimate of possible loss		1.5
Commercial general liability claims
Other commitments
Estimate of possible loss		$ 0.3

Stock-Based Compensation (Detai

Stock-Based Compensation (Details)	1 Months Ended		5 Months Ended	6 Months Ended	12 Months Ended
	Dec. 31, 2018USD ($)shares	Jun. 30, 2015shares	Apr. 30, 2016USD ($)shares	Oct. 31, 2016USD ($)shares	Dec. 31, 2018USD ($)periodshares	Dec. 31, 2017USD ($)shares	Dec. 31, 2016USD ($)	Jun. 30, 2017shares
Stock Based Compensation
Stock option shares approved								425,000
2015 Plan
Stock Based Compensation
Shares reserved for issuance	14,584,892	3,451,495			14,584,892
Shares reserved for issuance as a proportion common stock outstanding (as a percent)					4.00%
2015 Plan | Minimum
Stock Based Compensation
Shares reserved for issuance	3,500,000				3,500,000
Employee stock purchase plan
Stock Based Compensation
Shares reserved for issuance	1,285,851	893,548			1,285,851
Shares reserved for issuance as a proportion common stock outstanding (as a percent)					1.00%
Price in relation to fair market value of common stock on the date of grant, lower range limit (as a percent)					85.00%
Maximum number of shares a participant may receive during the period (in shares)					5,000
Maximum amount of award or purchase during a calendar year | $					$ 25,000
Maximum offering period, term					27 months
Number of expected offering periods each year | period					2
Offering period, expected term					6 months
Issuance of common stock under employee stock purchase plan (in shares)			206,447	184,825
Proceeds from issuance of common stock under employee stock purchase plan | $			$ 1,900,000	$ 1,700,000
Maximum employee contribution of employee's cash compensation (as a percent)	15.00%				15.00%
Employee stock purchase plan | Minimum
Stock Based Compensation
Shares reserved for issuance	880,000				880,000
Performance-based awards
Stock Based Compensation
Stock option shares approved	600,000				600,000			200,000
Stock-based compensation expense | $	$ 0
Employee and non-employee stock options
Stock Based Compensation
Stock-based compensation expense | $					$ 14,198,000	$ 11,402,000	$ 10,601,000
Shares available for issuance	5,431,000				5,431,000	4,737,000
Employee and non-employee stock options | 2015 Plan
Stock Based Compensation
Vesting period					4 years
Expiration period		10 years
Stock appreciation rights | 2015 Plan
Stock Based Compensation
Vesting period					4 years
Expiration period					10 years
Restricted stock units
Stock Based Compensation
Shares granted					953

Stock-Based Compensation - Stoc

Stock-Based Compensation - Stock Options (Details) - Employee and non-employee stock options - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Stock Based Compensation
Shares available for grant, beginning balance	4,737
Additional shares authorized	2,161
Options granted (in shares)	(2,319)
Options forfeited (in shares)	852
Shares available for grant, end balance	5,431	4,737
Number of shares
Outstanding, beginning balance (in shares)	9,963
Options granted (in shares)	2,319
Options exercised (in shares)	(1,967)
Options forfeited (in shares)	(852)
Outstanding, end balance (in shares)	9,463	9,963
Exercisable (in shares)	5,484
Vested and expected to vest (in shares)	9,224
Weighted-Average Exercise Price
Outstanding, beginning balance (in dollars per share)	$ 6.54
Granted (in dollars per share)	11.77
Exercised (in dollars per share)	6.78
Forfeited (in dollars per share)	7.54
Outstanding, end balance (in dollars per share)	7.69	$ 6.54
Exercisable (in dollars per share)	5.25
Vested and expected to vest (in dollars per share)	$ 7.60
Additional disclosures
Weighted average contractual term, options outstanding	6 years 10 months 28 days	7 years 11 days
Exercisable (in years)	5 years 6 months 26 days
Vested and expected to vest (in years)	6 years 10 months 13 days
Aggregate intrinsic value, options outstanding	$ 61,718	$ 31,902
Aggregate intrinsic value, options exercisable	48,055
Aggregate intrinsic value, vested and expected to vest	60,895
Aggregate intrinsic value, options exercised	25,600	3,700	$ 16,900
Fair value, options vested	$ 11,300	$ 12,100	$ 8,500
Weighted-average grant date fair value, options granted	$ 4.85	$ 5.71	$ 5.92

Stock-Based Compensation - Perf

Stock-Based Compensation - Performance-based Awards (Details) - USD ($) $ in Millions	1 Months Ended	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2018	Jun. 30, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option shares approved			425,000
Performance-based awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option shares approved	600,000	600,000	200,000
Requisite service period		3 years
Stock-based compensation expense	$ 0
Performance-based awards | Strategic arrangement milestone
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options unvested (in shares)	50,000	50,000
Vesting period		1 year
Performance-based awards | Licensing arrangement milestone
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options unvested (in shares)	75,000	75,000
Vesting period		1 year
Performance-based awards | Licensing arrangements related to oncology milestone
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options unvested (in shares)	75,000	75,000
Vesting period		1 year

Stock-Based Compensation - Rest

Stock-Based Compensation - Restricted Stock Units (Details) - Restricted stock units	12 Months Ended
	Dec. 31, 2018$ / sharesshares
Shares
Balance (in shares) | shares	389
Granted (in shares) | shares	953
Vested (in shares) | shares	(177)
Canceled/Forfeited (in shares) | shares	(81)
Balance (in shares) | shares	1,084
Weighted Average Grant Date Fair Value
Balance (in dollars per share) | $ / shares	$ 10.38
Granted (in dollars per share) | $ / shares	11.86
Vested (in dollars per share) | $ / shares	13.84
Canceled/Forfeited (in dollars per share) | $ / shares	9.91
Balance (in dollars per share) | $ / shares	$ 11.72

Stock-Based Compensation - Comp

Stock-Based Compensation - Compensation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Employee and non-employee stock options
Stock based compensation expense
Options granted (in shares)	2,319,000
Stock-based compensation expense	$ 14,198	$ 11,402	$ 10,601
Unrecognized compensation expense	$ 24,800
Unrecognized compensation expense recognized over weighted average period	2 years 5 months 12 days
Employee and non-employee stock options | Cost of product revenues
Stock based compensation expense
Stock-based compensation expense	$ 569	544	641
Employee and non-employee stock options | Research and development
Stock based compensation expense
Stock-based compensation expense	4,043	3,214	2,853
Employee and non-employee stock options | Selling, general and administrative
Stock based compensation expense
Stock-based compensation expense	9,586	7,644	7,107
Employee stock options
Stock based compensation expense
Stock-based compensation expense	14,081	11,402	10,317
Employee stock options | Cost of product revenues
Stock based compensation expense
Stock-based compensation expense	564	544	651
Employee stock options | Research and development
Stock based compensation expense
Stock-based compensation expense	4,043	3,214	2,829
Employee stock options | Selling, general and administrative
Stock based compensation expense
Stock-based compensation expense	$ 9,474	$ 7,644	6,837
Non-employee stock options
Stock based compensation expense
Options granted (in shares)	131,865
Options unvested (in shares)	36,344
Stock-based compensation expense	$ 117		284
Non-employee stock options | Cost of product revenues
Stock based compensation expense
Stock-based compensation expense	5		(10)
Non-employee stock options | Research and development
Stock based compensation expense
Stock-based compensation expense			24
Non-employee stock options | Selling, general and administrative
Stock based compensation expense
Stock-based compensation expense	$ 112		$ 270

Stock-Based Compensation - Assu

Stock-Based Compensation - Assumptions (Details)	12 Months Ended
	Dec. 31, 2018componentshares	Dec. 31, 2017	Dec. 31, 2016
Valuation of Stock Option Grants to Employees
Number of components averaged to estimate expected term | component	2
Employee and non-employee stock options
Stock Based Compensation
Options granted (in shares)	2,319,000
Employee stock options
Valuation of Stock Option Grants to Employees
Expected volatility, minimum	40.28%	40.75%	63.06%
Expected volatility, maximum	42.53%	62.93%	72.49%
Expected dividend rate	0.00%	0.00%	0.00%
Risk free interest rate, minimum	2.37%	1.67%	0.97%
Risk free interest rate, maximum	3.06%	2.16%	1.92%
Employee stock options | Minimum
Valuation of Stock Option Grants to Employees
Expected term (years)	5 years 2 months 27 days	5 years 1 month 21 days	5 years 1 month 6 days
Employee stock options | Maximum
Valuation of Stock Option Grants to Employees
Expected term (years)	5 years 7 months 13 days	5 years 2 months 27 days	5 years 2 months 12 days
Non-employee stock options
Stock Based Compensation
Options granted (in shares)	131,865
Options unvested (in shares)	36,344
Valuation of Stock Option Grants to Employees
Expected volatility, minimum	41.36%	41.22%	50.90%
Expected volatility, maximum	43.84%	52.18%	72.61%
Expected dividend rate	0.00%	0.00%	0.00%
Risk free interest rate, minimum	2.36%	1.42%	0.68%
Risk free interest rate, maximum	2.86%	1.95%	1.38%
Non-employee stock options | Minimum
Valuation of Stock Option Grants to Employees
Expected term (years)	2 years 8 months 19 days	2 years 8 months 1 day	2 years 7 months 24 days
Non-employee stock options | Maximum
Valuation of Stock Option Grants to Employees
Expected term (years)	2 years 9 months 4 days	2 years 8 months 16 days	3 years 1 month 28 days

Debt (Details)

Debt (Details) - USD ($) $ / shares in Units, $ in Thousands	Aug. 08, 2017	Aug. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Aug. 14, 2017	Sep. 30, 2015
Debt Instrument [Line Items]
Common stock, shares issued			62,082,348	54,040,000
Payments of debt issuance costs				$ 287
Amortization of debt discount			$ 391	154
Interest expense			10,476	4,213	$ 533
Net carrying amount			73,357	73,065
Line Of Credit-UBS
Debt Instrument [Line Items]
Maximum borrowing capacity							$ 50,000
Interest expense			1,600	1,000	$ 500
Interest paid			1,500	500
Outstanding balance			50,200
Debt, interest accrued			$ 1,200
Line Of Credit-UBS | 30-day LIBOR
Debt Instrument [Line Items]
Spread on interest rate (as a percent)			1.10%
2017 Term Loan
Debt Instrument [Line Items]
Maximum borrowing capacity		$ 100,000
Available borrowing capacity	$ 75,000		$ 75,000	75,000
Remaining borrowing capacity	$ 25,000	$ 50,000	50,000
Interest expense			8,600	3,200
Interest paid			6,100	3,100
Repayments			0
Additional interest in the event of default (as a percent)		3.00%
Common stock, shares issued		300,000				300,000
Debt instrument, fee amount		$ 2,400
Stock issued (in dollars per share)	$ 8.16
Accrued interest			2,100
Payments of debt issuance costs	$ 300
Amortization of debt discount			100
Debt discount		2,700	600
Debt, increase (decrease)		$ (2,000)
Less: unamortized debt discount			(1,643)	(1,935)
Net carrying amount			$ 73,357	$ 73,065
2017 Term Loan | Minimum
Debt Instrument [Line Items]
Prepayment premium (as a percent)		2.50%
2017 Term Loan | Maximum
Debt Instrument [Line Items]
Prepayment premium (as a percent)		12.50%
2017 Term Loan | Base Rate
Debt Instrument [Line Items]
Spread on interest rate (as a percent)		8.75%
Base interest rate (as a percent)		1.00%	8.50%
Spread on base interest rate (as a percent)			1.00%

Warrants (Details)

Warrants (Details) - USD ($) $ / shares in Units, $ in Millions	Jun. 26, 2018	Apr. 30, 2014
Class of Stock [Line Items]
Warrants exercised (in shares)	332,896
Warrant liability, fair value	$ 6.8
Secured Loan Arrangement
Class of Stock [Line Items]
Warrants outstanding (in shares)		376,691
Warrants exercise price (in dollars per share)		$ 2.3229

Stockholders' Equity (Details)

Stockholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands	Jun. 26, 2018	Jul. 31, 2018	Dec. 31, 2018	Dec. 31, 2017	Aug. 08, 2017	Dec. 31, 2016	Dec. 31, 2015
Preferred stock, shares authorized			50,000,000	50,000,000
Preferred stock, shares issued			0	0
Preferred stock, shares outstanding			0	0
Common stock, shares authorized			750,000,000	750,000,000
Common stock, par value (in dollars per share)			$ 0.0001	$ 0.0001
Common stock, shares issued			62,082,348	54,040,000
Common stock, shares outstanding			62,082,348	54,040,000
Issuance of common stock in exchange for commitment to provide debt financing				$ 2,448
Stock price (in dollars per share)					$ 8.16
Issuance of common stock upon exercise of warrants (in shares)	332,896
Issuance of common stock upon exercise of warrants			$ 6,762
July 2018 Offering
Common stock, shares issued		4,500,000
Stock issued (in dollars per share)		$ 20
Option for additional shares
Common stock, shares issued		675,000
July 2018 Offering inclusive of option for additional shares
Proceeds from issuance of common stock		$ 97,300
Payment of offering costs		$ 500
Common stock
Common stock, shares issued			62,083,000	54,040,000		52,665,000	50,346,000
Issuance of common stock in exchange for commitment to provide debt financing (in shares)				300,000
Issuance of common stock upon exercise of warrants (in shares)			333,000

Income Taxes - Effective Tax Ra

Income Taxes - Effective Tax Rates (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Effective tax rates differing from U.S. federal statutory rate
U.S. Federal taxes (benefit) at statutory rate									$ (26,800)	$ (46,206)	$ (32,277)
State tax expense									(4,468)	(6,559)	(2,842)
Research and development credits									(1,164)	(1,149)	(1,449)
Stock-based compensation									(3,148)	(5,036)	1,275
Change in federal tax rate										44,701
Mark to market fair value adjustments									865	(390)	49
Nondeductible settlement for claims									1	3,873
Other nondeductible items									885	1,009	933
Change in valuation allowance									34,150	10,211	34,453
Provision for income taxes	$ (14)	$ 118	$ 113	$ 104	$ 181	$ 162	$ 64	$ 47	$ 321	$ 454	$ 142
U.S. Federal taxes (benefit) at statutory rate (as a percent)									(21.00%)	(34.00%)	(34.00%)
State tax expense (as a percent)									(3.50%)	(4.83%)	(2.99%)
Research and development credits (as a percent)									(0.91%)	(0.85%)	(1.53%)
Stock-based compensation (as a percent)									(2.47%)	(3.71%)	1.34%
Change in federal tax rate									0.00%	32.89%	0.00%
Mark to market fair value adjustments (as a percent)									0.68%	(0.29%)	0.05%
Nondeductible settlement for claims (as a percent)									0.00%	2.85%	0.00%
Other nondeductible items (as a percent)									0.69%	0.74%	0.99%
Change in valuation allowance (as a percent)									26.76%	7.51%	36.29%
Provision for income taxes (as a percent)									0.25%	0.31%	0.15%
Income tax expense	$ (14)	$ 118	$ 113	$ 104	$ 181	$ 162	$ 64	$ 47	$ 321	$ 454	$ 142
Foreign income tax expense									200	200	$ 100
State income tax expense									$ 100	$ 200

Income Taxes - Deferred Income

Income Taxes - Deferred Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Income Taxes
Valuation allowance	$ 122,441	$ 95,817	$ 85,600
Effect Of Tax Cuts And Jobs Act Of 2017 [Abstract]
Corporate tax rate	21.00%	34.00%	34.00%
Deferred tax assets
Net operating loss carryforwards	$ 95,321	$ 77,356
Research and development tax credit carryforwards	15,632	12,675
Reserves and accruals	7,922	3,404
Stock based compensation	4,076	2,929
Total deferred tax assets before valuation allowance	122,951	96,364
Less: valuation allowance	(122,441)	(95,817)	$ (85,600)
Deferred tax assets, net	510	547
Deferred tax liabilities
Property and equipment	(510)	(547)
Net deferred tax assets

Income Taxes - Net Operating Lo

Income Taxes - Net Operating Loss Carryforwards (Details) $ in Millions	Dec. 31, 2018USD ($)
Federal
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	$ 394
State
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	$ 201.4

Income Taxes - Tax Credit Carry

Income Taxes - Tax Credit Carryforwards (Details) $ in Millions	Dec. 31, 2018USD ($)
Tax Credit Carryforward [Line Items]
Taxable income required for full realization of deferred tax assets	$ 488.1
Federal | Research and development tax credit carryforward
Tax Credit Carryforward [Line Items]
Tax credit carryforward	14.1
State | Research and development tax credit carryforward
Tax Credit Carryforward [Line Items]
Tax credit carryforward	$ 10.5

Income Taxes - Unrecognized Tax

Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Income Taxes [Line Items]
Interest and penalties accrued	$ 0
Reconciliation of the beginning and ending amount of gross unrecognized tax benefits
Balance at beginning of year	5,945	$ 4,293	$ 2,405
Additions based on tax positions related to the current year	1,416	1,651	1,836
Additions for tax positions of prior years	1	1	52
Balance at end of year	7,362	5,945	4,293
Research and development tax credit carryforward
Income Taxes [Line Items]
Unrecognized tax benefits increase	$ 1,400	$ 1,700	$ 1,900

Net Loss per Share - Loss per S

Net Loss per Share - Loss per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Numerator:
Net loss used to compute net loss per share, basic									$ (128,154)	$ (137,628)	$ (100,327)
Less: Remeasurement gain on warrant liability										(1,148)
Net loss used to compute net loss per share, diluted									$ (128,154)	$ (138,776)	$ (100,327)
Denominator:
Weighted-average number of shares used in computing net loss per share, basic									57,848	53,312	51,667
Less: weighted-average unvested shares subject to repurchase											(91)
Add: incremental shares from assumed exercise of warrants										292
Net loss per share, basic (in dollars per share)	$ (0.51)	$ (0.49)	$ (0.62)	$ (0.61)	$ (0.88)	$ (0.52)	$ (0.55)	$ (0.63)	$ (2.22)	$ (2.58)	$ (1.95)
Net loss per share, diluted (in dollars per share)	$ (0.51)	$ (0.49)	$ (0.62)	$ (0.61)	$ (0.90)	$ (0.52)	$ (0.55)	$ (0.65)	$ (2.22)	$ (2.59)	$ (1.95)

Net Loss per Share - Potentiall

Net Loss per Share - Potentially Dilutive Shares (Details) - shares	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive shares not included in diluted per share calculations	10,589	10,431	9,669
Employee and non-employee stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive shares not included in diluted per share calculations	9,463	9,963	9,043
Warrants to purchase common stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive shares not included in diluted per share calculations			377
Restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive shares not included in diluted per share calculations	1,084	389	159
Employee stock purchase plan
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive shares not included in diluted per share calculations	42	79	90

Subsequent Events (Details)

Subsequent Events (Details) - USD ($) $ in Millions	1 Months Ended			12 Months Ended
	Mar. 31, 2019	Feb. 28, 2019	Jan. 31, 2019	Dec. 31, 2018	Mar. 01, 2019
Subsequent Event [Line Items]
Agreement term				4 years
Subsequent Event
Subsequent Event [Line Items]
Settlement agreement installment paid off	$ 1.4
Letter of credit expired and funds released					$ 4.2
Subsequent Event | Genetic testing
Subsequent Event [Line Items]
Agreement term			2 years
Purchase commitment			$ 9.7
Subsequent Event | Genetic testing | Another supplier
Subsequent Event [Line Items]
Purchase commitment		$ 4
Subsequent Event | Genetic testing | Beijing Genomics Institute ("BGI Genomics")
Subsequent Event [Line Items]
Revenue, remaining performance obligation		$ 50
Agreement term		10 years
Purchase commitment		$ 6
Subsequent Event | License fee | Beijing Genomics Institute ("BGI Genomics")
Subsequent Event [Line Items]
Revenue, remaining performance obligation		35
Subsequent Event | Future milestone payments | Beijing Genomics Institute ("BGI Genomics")
Subsequent Event [Line Items]
Revenue, remaining performance obligation		$ 15

Quarterly Financial Data (Detai

Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Operating results:
Total revenues	$ 66,965	$ 65,280	$ 63,069	$ 62,340	$ 52,050	$ 55,910	$ 52,283	$ 49,382	$ 257,654	$ 209,625	$ 212,512
Cost of revenues	40,345	39,477	39,204	39,055	35,153	33,558	33,709	33,088	158,081	135,508	134,494
Cost of licensing and other revenues	2,444	2,202	1,791	1,537	1,572	1,054	850	612	7,974	4,088	1,080
Gross profit	24,176	23,601	22,074	21,748	15,325	21,298	17,724	15,682
Other expenses	53,903	50,767	49,292	52,265	61,956	47,087	46,095	50,232
Interest expense and other income (expense), net	(2,128)	(2,332)	(6,493)	(2,252)	(405)	(1,914)	(631)	1,117
Income tax expense	14	(118)	(113)	(104)	(181)	(162)	(64)	(47)	(321)	(454)	(142)
Net loss	$ (31,841)	$ (29,616)	$ (33,824)	$ (32,873)	$ (47,217)	$ (27,865)	$ (29,066)	$ (33,480)	$ (128,154)	$ (137,628)	$ (100,327)
Per share data:
Net loss - basic (in dollars per share)	$ (0.51)	$ (0.49)	$ (0.62)	$ (0.61)	$ (0.88)	$ (0.52)	$ (0.55)	$ (0.63)	$ (2.22)	$ (2.58)	$ (1.95)
Net loss - diluted (in dollars per share)	$ (0.51)	$ (0.49)	$ (0.62)	$ (0.61)	$ (0.90)	$ (0.52)	$ (0.55)	$ (0.65)	$ (2.22)	$ (2.59)	$ (1.95)