Cover Page
Cover Page - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 21, 2023 | Jun. 30, 2022 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-39725 | ||
Entity Registrant Name | Maravai LifeSciences Holdings, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 85-2786970 | ||
Entity Address, Address Line One | 10770 Wateridge Circle | ||
Entity Address, Address Line Two | Suite 200 | ||
Entity Address, City or Town | San Diego | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 92121 | ||
City Area Code | 858 | ||
Local Phone Number | 546-0004 | ||
Title of 12(b) Security | Class A common stock, $0.01 par value | ||
Trading Symbol | MRVI | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 3,121.1 | ||
Documents Incorporated by Reference | The information required by Part III of this Report, to the extent not set forth herein, is incorporated herein by reference from the registrant’s definitive proxy statement relating to the Annual Meeting of Shareholders to be held in 2023, which definitive proxy statement shall be filed with the Securities and Exchange Commission within 120 days after the end of the fiscal year to which this Report relates. | ||
Entity Central Index Key | 0001823239 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Common Class A | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding (in shares) | 131,785,305 | ||
Common Class B | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding (in shares) | 119,094,026 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Auditor Information [Abstract] | |
Auditor Firm ID | 42 |
Auditor Name | Ernst & Young LLP |
Auditor Location | San Mateo, California |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash | $ 632,138 | $ 551,272 |
Accounts receivable, net | 138,624 | 117,512 |
Inventory | 43,152 | 51,557 |
Prepaid expenses and other current assets | 25,798 | 19,698 |
Government funding receivable | 8,190 | 0 |
Total current assets | 847,902 | 740,039 |
Property and equipment, net | 52,694 | 46,332 |
Goodwill | 283,668 | 152,766 |
Intangible assets, net | 216,663 | 117,571 |
Deferred tax assets | 765,799 | 808,117 |
Other assets | 115,589 | 53,451 |
Total assets | 2,282,315 | 1,918,276 |
Current liabilities: | ||
Accounts payable | 5,991 | 8,154 |
Accrued expenses and other current liabilities | 53,371 | 34,574 |
Deferred revenue | 3,088 | 10,211 |
Current portion of payable to related parties pursuant to the Tax Receivable Agreement | 42,254 | 34,838 |
Current portion of long-term debt | 5,440 | 6,000 |
Total current liabilities | 110,144 | 93,777 |
Long-term debt, less current portion | 521,997 | 524,591 |
Payable to related parties pursuant to the Tax Receivable Agreement, less current portion | 675,956 | 713,481 |
Other long-term liabilities | 68,975 | 41,066 |
Total liabilities | 1,377,072 | 1,372,915 |
Commitments and contingencies (Note 8) | ||
Stockholders’ equity: | ||
Additional paid-in capital | 137,898 | 128,386 |
Retained earnings | 404,766 | 184,561 |
Total stockholders’ equity attributable to Maravai LifeSciences Holdings, Inc. | 545,218 | 315,499 |
Non-controlling interest | 360,025 | 229,862 |
Total stockholders’ equity | 905,243 | 545,361 |
Total liabilities and stockholders’ equity | 2,282,315 | 1,918,276 |
Common Class A | ||
Stockholders’ equity: | ||
Common stock | 1,317 | 1,315 |
Common Class B | ||
Stockholders’ equity: | ||
Common stock | $ 1,237 | $ 1,237 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Common Class A | ||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 131,692,000 | 131,488,000 |
Common stock, shares outstanding (in shares) | 131,692,000 | 131,488,000 |
Common Class B | ||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, shares issued (in shares) | 123,669,000 | 123,669,000 |
Common stock, shares outstanding (in shares) | 123,669,000 | 123,669,000 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Statement [Abstract] | |||
Revenue | $ 883,001 | $ 799,240 | $ 284,098 |
Operating expenses: | |||
Cost of revenue | 168,957 | 140,561 | 79,649 |
Selling, general and administrative | 129,259 | 100,064 | 94,245 |
Research and development | 18,369 | 15,219 | 9,304 |
Change in estimated fair value of contingent consideration | (7,800) | 0 | 0 |
Gain on sale of business | 0 | (11,249) | 0 |
Gain on sale and leaseback transaction | (19,002) | ||
Total operating expenses | 308,785 | 244,595 | 164,196 |
Income from operations | 574,216 | 554,645 | 119,902 |
Other income (expense): | |||
Interest expense | (20,414) | (30,260) | (30,740) |
Interest income | 2,338 | 0 | 0 |
Loss on extinguishment of debt | (208) | 0 | (7,592) |
Change in payable to related parties pursuant to the Tax Receivable Agreement | (4,102) | 6,101 | 0 |
Other (expense) income | (358) | 279 | 126 |
Income before income taxes | 551,472 | 530,765 | 81,696 |
Income tax expense | 60,809 | 61,515 | 2,880 |
Net income | 490,663 | 469,250 | 78,816 |
Net income (loss) attributable to non-controlling interests | 270,458 | 287,213 | (10,156) |
Net income attributable to Maravai LifeSciences Holdings, Inc. | $ 220,205 | $ 182,037 | $ 88,972 |
Net income per Class A common share/unit attributable to Maravai LifeSciences Holdings, Inc.: | |||
Basic (in usd per share) | $ 1.67 | $ 1.59 | $ 7.43 |
Diluted (in usd per share) | $ 1.67 | $ 1.56 | $ 2.36 |
Weighted average number of Class A common shares/units outstanding: | |||
Basic (in shares) | 131,545 | 114,791 | 10,351 |
Diluted (in shares) | 255,323 | 257,803 | 28,908 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 490,663 | $ 469,250 | $ 78,816 |
Other comprehensive income: | |||
Foreign currency translation adjustments | 0 | 55 | (44) |
Total other comprehensive income | 490,663 | 469,305 | 78,772 |
Comprehensive income attributable to non-controlling interests | 270,458 | 287,224 | (10,156) |
Total comprehensive income attributable to Maravai LifeSciences Holdings, Inc. | $ 220,205 | $ 182,081 | $ 88,928 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders'/Member's Equity - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Class A Common Stock | Class A Common Stock | Member’s Equity | Common Stock Class A Common Stock | Common Stock Class A Common Stock | Additional Paid-In Capital | Retained Earnings | Retained Earnings Cumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Income (Loss) | Non-controlling Interest | Non-controlling Interest Cumulative Effect, Period of Adoption, Adjustment |
Accounting Standards Update [Extensible Enumeration] | Accounting Standards Update 2016-02 [Member] | ||||||||||||
Beginning balance at Dec. 31, 2019 | $ 141,529 | ||||||||||||
Increase (Decrease) in Members' Equity [Roll Forward] | |||||||||||||
Net income | $ 78,816 | ||||||||||||
Beginning balance (in shares) at Dec. 31, 2019 | 0 | 0 | |||||||||||
Beginning balance at Dec. 31, 2019 | 144,627 | $ 0 | $ 0 | $ 0 | $ 0 | $ (133) | $ 3,231 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Net income | 78,816 | ||||||||||||
Foreign currency translation adjustments | (44) | ||||||||||||
Ending balance (in shares) at Dec. 31, 2020 | 96,647,000 | 160,974,000 | |||||||||||
Ending balance at Dec. 31, 2020 | 154,746 | $ 4,454 | 0 | $ 966 | $ 1,610 | 85,125 | 854 | $ 1,670 | (44) | 66,235 | $ 2,784 | ||
Increase (Decrease) in Members' Equity [Roll Forward] | |||||||||||||
Distributions to non-controlling interests holders | (153,492) | (41) | (153,451) | ||||||||||
Net income | 469,250 | 182,037 | 287,213 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Effect of exchanges of LLC Units (in shares) | 34,734,000 | (34,734,000) | |||||||||||
Effect of exchanges of LLC Units | 0 | $ 348 | $ (348) | 31,003 | (31,003) | ||||||||
Recognition of impact of Tax Receivable Agreement due to exchanges of LLC Units | 53,000 | 53,000 | |||||||||||
Issuance of Class A common stock (in shares) | 107,000 | ||||||||||||
Issuance of Class A common stock | 1,670 | $ 1 | 1,669 | ||||||||||
Impact of cash contribution to Topco LLC, exchange and forfeiture of LLC Units, and forfeiture of Class B common stock by MLSH 1 (in shares) | (2,571,000) | ||||||||||||
Impact of cash contribution to Topco LLC, exchange and forfeiture of LLC Units, and forfeiture of Class B common stock by MLSH 1 | 5,220 | $ (25) | (46,206) | 51,451 | |||||||||
Non-controlling interest adjustment for changes in proportionate ownership in Topco LLC | 0 | (809) | 809 | ||||||||||
Stock-based compensation | 10,458 | 4,645 | 5,813 | ||||||||||
Net income | 469,250 | 182,037 | 287,213 | ||||||||||
Foreign currency translation adjustments | 55 | 44 | 11 | ||||||||||
Tax distribution to non-controlling interest holder | (153,492) | (41) | (153,451) | ||||||||||
Ending balance (in shares) at Dec. 31, 2021 | 131,488,000 | 123,669,000 | 131,488,000 | 123,669,000 | |||||||||
Ending balance at Dec. 31, 2021 | 545,361 | 0 | $ 1,315 | $ 1,237 | 128,386 | 184,561 | 0 | 229,862 | |||||
Increase (Decrease) in Members' Equity [Roll Forward] | |||||||||||||
Distributions to non-controlling interests holders | (150,065) | 141 | (150,206) | ||||||||||
Net income | 490,663 | 220,205 | 270,458 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Issuance of Class A common stock (in shares) | 204,000 | ||||||||||||
Issuance of Class A common stock | 2,305 | $ 2 | 2,303 | ||||||||||
Non-controlling interest adjustment for changes in proportionate ownership in Topco LLC | 0 | (864) | 864 | ||||||||||
Stock-based compensation | 18,670 | 9,623 | 9,047 | ||||||||||
Impact of change to deferred tax asset associated with cash contribution to Topco LLC | (1,691) | (1,691) | |||||||||||
Net income | 490,663 | 220,205 | 270,458 | ||||||||||
Foreign currency translation adjustments | 0 | ||||||||||||
Tax distribution to non-controlling interest holder | (150,065) | 141 | (150,206) | ||||||||||
Ending balance (in shares) at Dec. 31, 2022 | 131,692,000 | 123,669,000 | 131,692,000 | 123,669,000 | |||||||||
Ending balance at Dec. 31, 2022 | $ 905,243 | $ 0 | $ 1,317 | $ 1,237 | $ 137,898 | $ 404,766 | $ 0 | $ 360,025 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Stockholders'/Member's Equity (Parenthetical) $ in Thousands | Nov. 20, 2020 USD ($) |
IPO | |
Stock issuance cost | $ 108,571 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating activities: | |||
Net income | $ 490,663 | $ 469,250 | $ 78,816 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation | 7,566 | 6,413 | 5,517 |
Amortization of intangible assets | 24,269 | 18,339 | 20,320 |
Amortization of right-of-use assets | 6,268 | 8,792 | 0 |
Amortization of deferred financing costs | 2,788 | 2,676 | 1,825 |
Equity-based compensation expense | 18,670 | 10,458 | 24,629 |
Loss on extinguishment of debt | 208 | 0 | 7,592 |
Deferred income taxes | 42,318 | 46,904 | (5,464) |
Change in estimated fair value of contingent consideration | (7,800) | 0 | 0 |
Gain on sale of business | 0 | (11,249) | 0 |
Gain on sale and leaseback transaction | 0 | 0 | |
Gain on sale and leaseback transaction | (19,002) | ||
Acquired and in-process research and development costs | 0 | 0 | 2,881 |
Financing costs incurred for line of credit | 0 | 0 | (3,239) |
Revaluation of liabilities under the Tax Receivable Agreement | 4,102 | (6,101) | 0 |
Other | (7,993) | (281) | 2,419 |
Changes in operating assets and liabilities: | |||
Accounts receivable | (22,272) | (70,391) | (33,144) |
Inventory | 9,459 | (21,574) | (19,099) |
Prepaid expenses and other assets | (52,873) | (9,513) | (5,518) |
Government funding receivable | 16,973 | 0 | 0 |
Accounts payable | (1,578) | 676 | 1,176 |
Accrued expenses and other current liabilities | 8,503 | (3,457) | 17,777 |
Deferred revenue | (7,123) | (67,851) | 77,220 |
Other long-term liabilities | 3,829 | (4,521) | (2,519) |
Net cash provided by operating activities | 535,977 | 368,570 | 152,187 |
Investing activities: | |||
Cash paid for acquisition, net of cash acquired | (238,969) | 0 | (3,024) |
Purchases of property and equipment | (17,090) | (14,850) | (25,408) |
Proceeds from government assistance allocated to property and equipment | 1,105 | 0 | 0 |
Prepaid lease payments on finance lease yet to commence | (13,278) | 0 | 0 |
Proceeds from sale of building | 0 | 548 | 34,500 |
Proceeds from sale of business, net of cash divested | 620 | 119,957 | 0 |
Net cash (used in) provided by investing activities | (267,612) | 105,655 | 6,068 |
Financing activities: | |||
Distributions to non-controlling interests holders | (150,206) | (153,451) | (97,051) |
Proceeds from borrowings of long-term debt, net of discount | 8,455 | 0 | 609,000 |
Financing costs incurred for long-term debt | 0 | 0 | (9,295) |
Repurchase of incentive units | 0 | 0 | (9,140) |
Principal repayments of long-term debt | (13,895) | (6,000) | (411,875) |
Payment of contingent consideration | 0 | 0 | (1,439) |
Payments made on facility financing lease obligation and capital lease | 0 | 0 | |
Payments made on facility financing lease obligation and capital lease | (201) | ||
Payment for non-controlling interests in MLSC | 0 | 0 | (120,005) |
Payment to MLSH 2 for Blocker Mergers | 0 | 0 | (208,053) |
Purchase of LLC Units from MLSH 1 | 0 | 0 | (1,424,324) |
Repurchase of Class A common stock from MLSH 2 | 0 | 0 | (33,658) |
Proceeds from issuance of Class A common stock under employee equity plans, net of shares withheld for employee taxes | 2,358 | 1,709 | 321 |
Net cash (used in) provided by financing activities | (187,499) | (159,049) | 53,212 |
Effects of exchange rate changes on cash | 0 | (88) | 17 |
Net increase in cash | 80,866 | 315,088 | 211,484 |
Cash, beginning of period | 551,272 | 236,184 | 24,700 |
Cash, end of period | 632,138 | 551,272 | 236,184 |
Supplemental cash flow information: | |||
Cash paid for interest | 20,198 | 27,234 | 28,916 |
Cash paid for income taxes | 23,032 | 22,473 | 5,006 |
Supplemental disclosures of non-cash activities: | |||
Property and equipment included in accounts payable and accrued expenses | 1,701 | 2,149 | 1,990 |
Financing cost deducted from long-term debt proceeds | 0 | 0 | 6,000 |
Right-of-use assets obtained in exchange for new operating lease liabilities | 17,513 | 0 | 0 |
Building and improvements capitalized under lease financing transaction | 0 | 0 | 700 |
Fair value of contingent consideration liability recorded in connection with acquisition of a business | 7,800 | 0 | 0 |
Accrued consideration payable for MyChem acquisition | 10,000 | 0 | 0 |
Exchange of units for MLSC non-controlling interests | 0 | 0 | 46,422 |
Exchange of Class A common stock for the Blocker Mergers | 0 | 0 | 782,073 |
Recognition of deferred tax assets from Organizational Transactions, subsequent exchanges and cash contribution | 0 | 423,361 | 441,984 |
Recognition of liabilities under the Tax Receivable Agreement | 0 | 366,179 | 389,546 |
IPO issuance costs included in accounts payable and accrued expenses | 0 | 0 | 2,816 |
Receivable from lessor funded financing | 0 | 0 | 1,987 |
Common Class A | |||
Financing activities: | |||
Proceeds from issuance of common stock | 0 | 0 | 1,757,245 |
Common Class B | |||
Financing activities: | |||
Proceeds from issuance of common stock | 0 | 0 | 1,687 |
MLSH 1 | |||
Financing activities: | |||
Payments pursuant to the Tax Receivable Agreement | (29,108) | (1,115) | 0 |
MLSH 2 | |||
Financing activities: | |||
Payments pursuant to the Tax Receivable Agreement | $ (5,103) | $ (192) | $ 0 |
Organization and Significant Ac
Organization and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Significant Accounting Policies | Organization and Significant Accounting Policies Description of Business Maravai LifeSciences Holdings, Inc. (the “Company”, and together with its consolidated subsidiaries, “Maravai”, “we”, “us”, and “our”) provides critical products to enable the development of drugs, therapeutics, diagnostics, vaccines and support research on human diseases. Our products address the key phases of biopharmaceutical development and include complex nucleic acids for diagnostic and therapeutic applications and antibody-based products to detect impurities during the production of biopharmaceutical products. The Company is headquartered in San Diego, California and has historically operated in three principal businesses: Nucleic Acid Production, Biologics Safety Testing and Protein Detection. In September 2021, the Company completed the divestiture of its Protein Detection business (see Note 2). Our Nucleic Acid Production business manufactures and sells products used in the fields of gene therapy, vaccines, nucleoside chemistry, oligonucleotide therapy and molecular diagnostics, including reagents used in the chemical synthesis, modification, labelling and purification of deoxyribonucleic acid (“DNA”) and ribonucleic acid (“RNA”). Our core Nucleic Acid Production offerings include messenger ribonucleic acid (“mRNA”), long and short oligonucleotides, our proprietary CleanCap® capping technology and oligonucleotide building blocks. Our Biologics Safety Testing business sells highly specialized analytical products for use in biologic manufacturing process development, including custom product-specific development antibody and assay development services. Our Protein Detection business sold innovative labeling and detection reagents for researchers in immunohistochemistry. Organization We were incorporated as a Delaware corporation in August 2020 for the purpose of facilitating an initial public offering (“IPO”). Immediately prior to the IPO, we effected a series of organizational transactions (the “Organizational Transactions”) as discussed in Note 10, which, together with the IPO, were completed in November 2020, that resulted in the Company operating, controlling all of the business affairs and becoming the ultimate parent company of Maravai Topco Holdings, LLC (“Topco LLC”) and its consolidated subsidiaries. Maravai Life Sciences Holdings, LLC (“MLSH 1”), which is controlled by investment entities affiliated with GTCR, LLC (“GTCR”), is the only other member of Topco LLC. The Company is the sole managing member of Topco LLC, which operates and controls TriLink Biotechnologies, LLC (“TriLink”), Glen Research, LLC, MockV Solutions, LLC and Cygnus Technologies, LLC (“Cygnus”) and their respective subsidiaries. Prior to the Company’s divestiture of its Protein Detection business in September 2021, Topco LLC also operated and controlled Vector Laboratories, Inc. and its subsidiaries (“Vector”). Basis of Presentation The Company operates and controls all of the business and affairs of Topco LLC, and, through Topco LLC and its subsidiaries, conducts its business. Because we manage and operate the business and control the strategic decisions and day-to-day operations of Topco LLC and also have a substantial financial interest in Topco LLC, we consolidate the financial results of Topco LLC, and a portion of our net income is allocated to the non-controlling interests in Topco LLC held by MLSH 1. The Organizational Transactions were considered transactions between entities under common control. As a result, the consolidated financial statements for periods prior to the IPO have been adjusted to combine the previously separate entities for presentation purposes. The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and include our accounts and the accounts of our subsidiaries. All intercompany transactions and accounts between the businesses comprising the Company have been eliminated in the accompanying consolidated financial statements. Variable Interest Entities The Company consolidates all entities that it controls through a majority voting interest or as the primary beneficiary of a variable interest entity (“VIE”). In determining whether the Company is the primary beneficiary of an entity, the Company applies a qualitative approach that determines whether it has both (i) the power to direct the economically significant activities of the entity and (ii) the obligation to absorb losses of, or the right to receive benefits from, the entity that could potentially be significant to that entity. The Company’s determination about whether it should consolidate such VIEs is made continuously as changes to existing relationships or future transactions may result in a consolidation event. Use of Estimates The preparation of consolidated financial statements in accordance with GAAP requires the Company to make judgements, estimates and assumptions that affect the reported amounts of assets, liabilities, equity, revenue and expenses, and related disclosures. These estimates form the basis for judgments the Company makes about the carrying values of assets and liabilities that are not readily apparent from other sources. The Company bases its estimates and judgments on historical experience and on various other assumptions that the Company believes are reasonable under the circumstances. These estimates are based on management’s knowledge about current events and expectations about actions the Company may undertake in the future. Significant estimates include, but are not limited to, the measurement of right-of-use assets and lease liabilities and related incremental borrowing rate, the payable to related parties pursuant to the Tax Receivable Agreement (as defined in Note 14), the realizability of our net deferred tax assets, and valuation of goodwill and intangible assets acquired in business combinations. Actual results could differ materially from those estimates. Revenue Recognition The Company generates revenue primarily from the sale of products, and to a much lesser extent, services in the fields of nucleic acid production, biologics safety testing, and protein detection. Revenue is recognized when control of promised goods or services is transferred to a customer in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To determine revenue recognition for its arrangements with customers, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The majority of the Company’s contracts include only one performance obligation. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is defined as the unit of account for revenue recognition. The Company also recognizes revenue from other contracts that may include a combination of products and services, the provision of solely services, or from license fee arrangements which may be associated with the delivery of product. Where there is a combination of products and services, the Company accounts for the promises as individual performance obligations if they are concluded to be distinct. Performance obligations are considered distinct if they are both capable of being distinct and distinct within the context of the contract. In determining whether performance obligations meet the criteria for being distinct, the Company considers a number of factors, such as the degree of interrelation and interdependence between obligations, and whether or not the good or service significantly modifies or transforms another good or service in the contract. As a practical expedient, we do not adjust the transaction price for the effects of a significant financing component if, at contract inception, the period between customer payment and the transfer of goods or services is expected to be one year or less. Contracts with customers are evaluated on a contract-by-contract basis as contracts may include multiple types of goods and services as described below. Nucleic Acid Production Nucleic Acid Production revenue is generated from the manufacture and sale of highly modified, complex nucleic acids products to support the needs of our of customers’ research, therapeutic and vaccine programs. The primary offering of products includes CleanCap, mRNA, and specialized oligonucleotides. Contracts typically consist of a single performance obligation. We also sell nucleic acid products for labeling and detecting proteins in cells and tissue samples research. The Company recognizes revenue from these products in the period in which the performance obligation is satisfied by transferring control to the customer. Revenue for nucleic acid catalog products is recognized at a single point in time, generally upon shipment to the customer. Revenue for contracts for certain custom nucleic acid products, with an enforceable right to payment and a reasonable margin for work performed to date, is recognized over time, based on a cost-to-cost input method over the manufacturing period. Payments received from customers in advance of manufacturing their products is recorded as deferred revenue until the products were delivered. Biologics Safety Testing The Company’s Biologics Safety Testing revenue is associated with the sale of bioprocess impurity detection kit products. We also enter into contracts that include custom antibody development, assay development and antibody affinity extraction services. These products and services enable the detection of impurities that occur in the manufacturing of biologic drugs and other therapeutics. The Company recognizes revenue from the sale of bioprocess impurity detection kits in the period in which the performance obligation is satisfied by transferring control to the customer. Custom antibody development contracts consist of a single performance obligation, typically with an enforceable right to payment and a reasonable margin for work performed to date. Revenue is recognized over time based on a cost-to-cost input method over the contract term. Where an enforceable right to payment does not exist, revenue is recognized at a point in time when control is transferred to the customer. Assay development service contracts consist of a single performance obligation, revenue is recognized at a point in time when a successful antigen test and report is provided to the customer. Affinity extraction services, which generally occur over a short period of time, consist of a single performance obligation to perform the extraction service and provide a summary report to the customer. Revenue is recognized either over time or at a point in time depending on contractual payment terms with the customer. The Company elected the practical expedient to not disclose the unfulfilled performance obligations for contracts with an original length of one year or less. The Company had no material unfulfilled performance obligations for contracts with an original length greater than one year for any period presented. The Company accepts returns only if the products do not meet customer specifications and historically, the Company’s volume of product returns has not been significant. Further, no warranties are provided for promised goods and services other than assurance type warranties. Revenue for an individual contract is recognized at the related transaction price, which is the amount the Company expects to be entitled to in exchange for transferring the products and/or services. The transaction price for product sales is calculated at the contracted product selling price. The transaction price for a contract with multiple performance obligations is allocated to the separate performance obligations on a relative standalone selling price basis. Standalone selling prices for products are determined based on the prices charged to customers, which are directly observable. Standalone selling price of services are mostly based on time and materials. Generally, payments from customers are due when goods and services are transferred. As most contracts contain a single performance obligation, the transaction price is representative of the standalone selling price charged to customers. Revenue is recognized only to the extent that it is probable that a significant reversal of the cumulative amount recognized will not occur in future periods. Variable consideration has not been material to our consolidated financial statements. Sales taxes Sales taxes collected by the Company are not included in the transaction price as revenue as they are ultimately remitted to a governmental authority. Shipping and handling costs The Company has elected to account for shipping and handling activities related to contracts with customers as costs to fulfill the promise to transfer the associated products. Accordingly, revenue for shipping and handling is recognized at the same time that the related product revenue is recognized. Contract costs The Company recognizes the incremental costs of obtaining contracts as an expense when incurred when the amortization period of the assets that otherwise would have been recognized is one year or less. These costs are included in sales and marketing and general and administrative expenses. The costs to fulfill the contracts are determined to be immaterial and are recognized as an expense when incurred. Contract balances Contract assets are generated when contractual billing schedules differ from revenue recognition timing and the Company records contract receivable when it has an unconditional right to consideration. There were no contract asset balances as of December 31, 2022 or 2021. Contract liabilities include billings in excess of revenue recognized, such as customer deposits and deferred revenue. Customer deposits, which are included in accrued expenses, are recorded when cash payments are received or due in advance of performance. Deferred revenue is recorded when the Company has unsatisfied performance obligations. Total contract liabilities were $4.8 million and $12.6 million as of December 31, 2022 and 2021, respectively. Contract liabilities are expected to be recognized into revenue within the next twelve months. Disaggregation of Revenue The following tables summarize the revenue by segment and region for the periods presented (in thousands): Year Ended December 31, 2022 Nucleic Acid Production Biologics Safety Testing Total North America $ 312,119 $ 27,354 $ 339,473 Europe, the Middle East and Africa 415,298 17,628 432,926 Asia Pacific 85,508 24,286 109,794 Latin and Central America 144 664 808 Total revenue $ 813,069 $ 69,932 $ 883,001 Year Ended December 31, 2021 Nucleic Acid Production Biologics Safety Testing Protein Detection Total North America $ 280,369 $ 25,686 $ 11,016 $ 317,071 Europe, the Middle East and Africa 377,325 15,597 4,752 397,674 Asia Pacific 54,114 26,471 3,068 83,653 Latin and Central America 56 663 123 842 Total revenue $ 711,864 $ 68,417 $ 18,959 $ 799,240 Year Ended December 31, 2020 Nucleic Acid Production Biologics Safety Testing Protein Detection Total North America $ 115,216 $ 21,787 $ 13,343 $ 150,346 Europe, the Middle East and Africa 69,637 14,862 5,606 90,105 Asia Pacific 21,444 17,946 3,783 43,173 Latin and Central America 23 302 149 474 Total revenue $ 206,320 $ 54,897 $ 22,881 $ 284,098 Total revenue is attributed to geographic regions based on the bill-to location of the transaction. For all periods presented, the majority of our revenue was recognized at a point in time. Shipping and Handling Costs Shipping and handling costs, which are charged to customers, are included in revenue. Shipping and handling charges included in revenue were approximately $3.2 million, $3.6 million and $3.3 million for the years ended December 31, 2022, 2021 and 2020, respectively. Freight and supplies costs directly associated with shipping products to customers are included as a component of cost of revenue. Research and Development Research and development (“R&D”) expenses include personnel costs, including salaries, benefits and equity-based compensation for laboratory personnel, outside contracted services, and costs of supplies. R&D costs are expensed as incurred. Payments made prior to the receipt of goods or services to be used in R&D are recognized as prepaid assets until the goods are received or services are rendered. Advertising Costs The Company expenses advertising costs as incurred. Advertising costs incurred were approximately $2.5 million, $1.3 million and $1.2 million during the years ended December 31, 2022, 2021 and 2020, respectively. Equity-Based Compensation Stock-Based Compensation The Company recognized stock-based compensation for all equity awards made to employees based upon the awards’ estimated grant date fair value. For equity awards that vest subject to the satisfaction of service requirements, compensation expense is measured based on the fair value of the award on the date of grant and expense is recognized on a straight-line basis over the requisite service period, which is typically between two The Company estimates the fair value of stock option grants using the Black-Scholes option pricing model. The assumptions used in estimating the fair value of these awards, such as expected term, expected dividend yield, volatility and risk-free interest rate, represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. If actual results are not consistent with the Company’s assumptions and judgments used in making these estimates, the Company may be required to increase or decrease compensation expense, which could be material to the Company’s consolidated results of operations. The fair value of restricted stock units (“RSUs”) is determined based on the number of shares granted and the quoted market price of the Company’s Class A common stock on the date of grant. For performance stock units (“PSUs”) which are subject to service and market conditions, compensation expense is measured based on the fair value of the award on the date of grant and expense is recognized on a straight-line basis over the requisite service period regardless if the market condition is satisfied. If the grantee is terminated prior to meeting both conditions, any previously recognized expense is reversed. The Company estimates the fair value of PSUs using the Monte Carlo simulation model. The assumptions used in estimating the fair value of these awards, such as expected term, volatility and risk-free interest rate, represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. Unit-Based Compensation Up until the IPO, MLSH 1 had granted unit-based awards to certain executives of Topco LLC who are also executives of the Company in the form of non-vested units. Topco LLC’s controlled subsidiary, MLSC, also granted unit-based awards only to certain employees of its subsidiaries (collectively, the “Incentive Units”). All awards of Incentive Units were measured based on the fair value of the award on the date of grant. The Company recognizes compensation expense for MLSH 1 awards in its consolidated financial statements as MLSH 1 is considered to be the economic interest holder in Topco LLC. Compensation expense for the Incentive Units is recognized over their requisite service period. Forfeitures are recognized when they occur. The grant date fair value of Incentive Unit awards was determined by the Company’s Board of Directors with the assistance of management and an independent third-party valuation specialist. Income Taxes We are subject to U.S. federal and state income taxes. We are the controlling member of Topco LLC, which has been, and will continue to be, treated as a partnership for U.S. federal and state income tax purposes. Topco LLC’s previously wholly-owned U.S. subsidiary, Maravai Life Sciences, Inc. (“Maravai Inc.”) and its subsidiaries, were taxpaying entities in the U.S., Canada, and the U.K. Maravai Inc.’s subsidiaries were sold and Maravai Inc. ceased to be a regarded entity and was deemed liquidated for U.S. tax purposes during the year ended December 31, 2021. Topco LLC’s other subsidiaries are treated as pass-through entities for federal and state income tax purposes. The income or loss generated by these entities is not taxed at the LLC level. As required by U.S. tax law, income or loss generated by these LLCs passes through to their owners. As such, our tax provision consists solely of the activities of Maravai Inc. and its subsidiaries, prior to their disposal, as well as our share of income generated by Topco LLC. We account for income taxes under the asset and liability method of accounting. Current income tax expense or benefit represents the amount of income taxes expected to be payable or refundable for the current year. We recognize deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as for operating loss and tax credit carryforwards. We measure deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which we expect to recover or settle those temporary differences. We recognize the effect of a change in tax rates on deferred tax assets and liabilities in the results of operations in the period that includes the enactment date. We reduce the measurement of a deferred tax asset, if necessary, by a valuation allowance if it is more likely than not that we will not realize some or all of the deferred tax asset. The Company’s tax positions are subject to income tax audits. We account for uncertain tax positions by recognizing the financial statement effects of a tax position only when, based upon technical merits, it is more likely than not that the position will be sustained upon examination. Significant judgment is required in determining the accounting for income taxes. In the ordinary course of business, many transactions and calculations arise where the ultimate tax outcome is uncertain. Our judgments, assumptions and estimates relative to the accounting for income taxes take into account current tax laws, our interpretation of current tax laws, and possible outcomes of future audits conducted by foreign and domestic tax authorities. Although we believe that our estimates are reasonable, the final tax outcome of matters could be different from our assumptions and estimates used when determining the accounting for income taxes. Such differences, if identified in future periods, could have a material effect on the amounts recorded in our consolidated financial statements. Interest and penalties related to unrecognized tax benefits are recognized in income tax expense in the accompanying consolidated statements of income. The provision for income taxes includes the effects of any accruals that the Company believes are appropriate, as well as any related net interest and penalties. Payables to Related Parties Pursuant to the Tax Receivable Agreement In November 2020, we entered into a Tax Receivable Agreement (“TRA”) with MLSH 1 and MLSH 2. The TRA provides for the payment by us to MLSH 1 and MLSH 2, collectively, of 85% of the amount of tax benefits, if any, that we actually realize, or in some circumstances are deemed to realize from exchanges of LLC Units (together with the corresponding shares of Class B common stock) for Class A common stock, as a result of (i) certain increases in the tax basis of assets of Topco LLC and its subsidiaries resulting from purchases or exchanges of LLC Units, (ii) certain tax attributes of the Organization Transactions and (iii) certain other tax benefits related to our entering into the TRA, including tax benefits attributable to payments that we make under the TRA (collectively, the “Tax Attributes”). The payment obligations under the TRA are not conditioned upon any LLC Unitholder maintaining a continued ownership interest in us or Topco LLC and the rights of MLSH 1 and MLSH 2 under the TRA are assignable. We expect to benefit from the remaining 15% of the tax benefits, if any, that we may actually realize. We accrue a liability for the payable to related parties for the TRA and a reduction to stockholders’ equity, when it is deemed probable that the Tax Attributes will be used to reduce our taxable income, as the contractual percentage of the benefit of Tax Attributes that we expected to receive over a period of time. The current portion, if any, of the liability is the amount estimated to be paid within one year of the consolidated balance sheet date. For purposes of estimating the value of the payable to related parties for the TRA, the tax benefit deemed realized by us and payable to MLSH 1 and MLSH 2 is computed by taking 85% of the difference of between our undiscounted forecasted cash income tax liability over the term of benefit of the Tax Attributes and the forecasted amount of such taxes that we would have been required to pay had there been no Tax Attributes. The TRA applies to each of our taxable years, beginning with the taxable year that the TRA is entered into. There is no maximum term for the TRA and the TRA will continue until all such tax benefits have been utilized or expired unless we exercise our right to terminate the TRA for an agreed-upon amount equal to the estimated present value of the remaining payments to be made under the agreement. We may record additional liabilities under the TRA when LLC Units of Topco LLC are exchanged in the future and as our estimates of the future utilization of the tax benefits change. If, due to a change in facts, these tax attributes are not utilized in future years, it is reasonably possible no amounts would be paid under the TRA. In this scenario, the reduction of the liability under the TRA would result in a benefit to our consolidated statements of income. Subsequent adjustments to the payable to related parties for the TRA based on changes in anticipated future taxable income are recorded in our consolidated statements of income. Non-Controlling Interests Non-controlling interests re present the portion of profit or loss, net assets and comprehensive income of our consolidated subsidiaries that is not allocable to the Company based on our percentage of ownership of such entities. Non-controlling interests consist of the following: • Until November, 2020 Topco LLC held a 70% ownership interest in MLSC Holdings, LLC (“MLSC”) through its consolidated subsidiaries with the remaining 30% being recorded as non-controlling interests in our consolidated financial statements . MLSC net income or loss was attributed to the non-controlling interests using an attribution method, similar to the hypothetical liquidation at book value method, based on the distribution provisions of the MLSC Amended and Restated Limited Liability Company Agreement (“MLSC LLC Agreement”). In November 2020, and before the closing of the IPO, Topco LLC repurchased all of the outstanding non-controlling interests in MLSC for $166.4 million (see Note 13) . • In November 2020, following the completion of the Organizational Transactions, we became the sole managing member of Topco LLC. As of December 31, 2022 , we held approximately 51.6% of the outstanding LLC Units of Topco LLC, and MLSH 1 held approximately 48.4% of the outstanding LLC Units of Topco LLC. Therefore, we report non-controlling interests based on the percentage of LLC Units of Topco LLC held by MLSH 1 on our consolidated balance sheet as of December 31, 2022. Income or loss attributed to the non-controlling interest in Topco LLC is based on the LLC Units outstanding during the period for which the income or loss is generated and is presented on the consolidated statements of income and consolidated statements of comprehensive income. MLSH 1 is entitled to exchange LLC Units, together with an equal number of shares of our Class B common stock (together referred to as “Paired Interests”), for shares of Class A common stock on a one-for-one basis or, at our election, for cash, from a substantially concurrent public offering or private sale (based on the price of our Class A common stock in such public offering or private sale). As such, future exchanges of Paired Interests by MLSH 1 will result in a change in ownership and reduce or increase the amount recorded as non-controlling interests and increase or decrease additional paid-in-capital when Topco LLC has positive or negative net assets, respectively. Segment Information The Company has historically operated in three reportable segments. Operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the Company’s chief operating decision maker (“CODM”) in deciding how to allocate resources and assessing performance. The CODM allocates resources and assesses performance based upon discrete financial information at the segment level. All of our long-lived assets are located in the United States. After the divestiture of Vector in September 2021, the Company no longer has the Protein Detection segment. The Company has reported the historical results of the Protein Detection business as such discrete financial information evaluated by the CODM for the periods presented included the information for this legacy segment. As of December 31, 2022, the Company operated in two reportable segments: Nucleic Acid Production and Biologics Safety Testing. Cash Cash consists of deposits held at financial institutions. Accounts Receivable and Allowance for Credit Losses Accounts receivable primarily consist of amounts due from customers for product sales and services. The Company’s expected credit losses are developed using an estimated loss rate method that considers historical collection experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The estimated loss rates are applied to trade receivables with similar risk characteristics such as the length of time the balance has been outstanding, liquidity and financial position of the customer, and the geographic location of the customer. In certain instances, the Company may identify individual accounts receivable assets that do not share risk characteristics with other accounts receivable, in which case the Company records its expected credit losses on an individual asset basis. As of December 31, 2022 and 2021, the allowance for credit losses was approximately $2.2 million and $0.3 million, respectively. Write-offs of accounts receivable and recoveries were not significant during the years ended December 31, 2022 or 2021. Inventory Inventories consist of raw materials, work in process and finished goods. Inventories are stated at the lower of cost (weighted average cost) or net realizable value. Inventory costs, which relate to the purchase or production of inventories, include materials, direct labor and manufacturing overhead. The Company regularly monitors for excess and obsolete inventory based on its estimates of expected sales volumes, production capacity and expiration of raw materials, work-in-process and finished products, and reduces the carrying value of inventory accordingly. The Company writes down inventory that has become obsolete, inventory that has a cost basis in excess of its expected net realizable value, and inventory in excess of expected manufacturing requirements. Any write-downs of inventories are charged to cost of revenue. A change in the estimated timing or amount of demand for the Company’s products could result in reduction to the recorded value of inventory quantities on hand. Any significant unanticipated changes in demand or unexpected quality failures could have a significant impact on the value of inventory and reported operating results. During all periods presented in the accompanying consolidated financial statements, there have been no material adjustments related to a revised estimate of our inventory valuations. Governmen |
Acquisitions and Divestiture
Acquisitions and Divestiture | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions and Divestiture | Acquisitions and Divestiture Acquisitions MyChem, LLC On January 27, 2022, the Company completed the acquisition of MyChem, LLC (“MyChem”), a privately-held San Diego, California-based provider of ultra-pure nucleotides to customers in the diagnostics, pharma, genomics and research markets. The acquisition will vertically integrate the Company’s supply chain and expand its product offerings for inputs used in the development of therapeutics and vaccines. The Company acquired MyChem for a total purchase consideration of $257.9 million, which is inclusive of net working capital adjustments. The total cash consideration was paid using existing cash on hand. The transaction was accounted for as an acquisition of a business as MyChem consisted of inputs and processes applied to those inputs that had the ability to contribute to the creation of outputs. For the year ended December 31, 2022, the Company incurred $3.5 million in transaction costs associated with the acquisition of MyChem, which were recorded within selling, general and administrative expenses in the consolidated statements of income. The acquisition date fair value of consideration transferred to acquire MyChem consisted of the following (in thousands): Cash paid (1) $ 240,145 Consideration payable 10,000 Fair value of contingent consideration 7,800 Total consideration transferred $ 257,945 ____________________ (1) Represents cash consideration paid at closing of $240.0 million and a purchase price adjustment paid in November 2022 of $0.1 million. Pursuant to the Securities Purchase Agreement (the “MyChem SPA”) between the Company and sellers of MyChem, additional payments to the sellers of MyChem are dependent upon meeting or exceeding defined revenue targets during fiscal 2022 (the “Performance Payment”). The MyChem SPA provides for a total maximum Performance Payment of $40.0 million. The MyChem SPA also provides that the Company will pay to the sellers of MyChem an additional $20.0 million (the “Retention Payment”) as of the second anniversary of the closing of the acquisition date as long as two senior employees who are also the sellers of MyChem continue to be employed by TriLink. The Company considers the payment of the Retention Payment as probable and is recognizing compensation expense related to this payment in the post-acquisition period ratably over the expected service period of two years. The MyChem SPA further provides that the Company will pay to the sellers of MyChem an additional amount of up to $10.0 million subject to the completion of certain calculations associated with acquired inventory, which has been recorded within accrued expenses and other current liabilities on the consolidated balance sheet as of December 31, 2022. The Performance Payment was recorded as contingent consideration and was included as part of the purchase consideration. For the year ended December 31, 2022, the Company recorded $9.3 million of compensation expense related to the Retention Payment within research and development expenses in the consolidated statements of income. The Company estimated the fair value of the Performance Payment contingent consideration based on a Monte-Carlo simulation model which utilized an income approach. The estimated fair value was based on MyChem revenue projections, expected payout term, volatility and risk adjusted discount rates which are Level 3 inputs (see Note 4). As the Company is in the process of finalizing the evaluation of certain liabilities and assets, the allocation of purchase consideration is preliminary, and provisional measurements of certain liabilities and goodwill are subject to change. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date (in thousands): Cash $ 1,176 Current assets 2,741 Intangible assets, net 123,360 Other assets 8,585 Total identifiable assets acquired 135,862 Current liabilities (420) Other long-term liabilities (8,399) Total liabilities assumed (8,819) Net identifiable assets acquired 127,043 Goodwill 130,902 Net assets acquired $ 257,945 We recorded the preliminary purchase price allocation in the first quarter of 2022. During the fourth quarter of 2022, we recorded measurement period adjustments resulting in an increase to goodwill of $0.1 million and a decrease to other assets and current liabilities of $0.7 million. The acquisition was accounted for under the acquisition method of accounting, and therefore, the total purchase price was allocated to the identifiable tangible and intangible assets acquired and the liabilities assumed based on their respective fair values as of the acquisition date. Purchase consideration in excess of the amounts recognized for the net assets acquired was recognized as goodwill. Goodwill is primarily attributable to expanded synergies expected from the acquisition associated with a vertical supply integration. There were no tax impacts associated with the acquisition due to the pass-through income tax treatment of MyChem. All of the goodwill acquired in connection with the acquisition of MyChem was allocated to the Company’s Nucleic Acid Production segment and is deductible to Topco LLC for income tax purposes. Upon closing of the acquisition, approximately $1.0 million was placed into escrow to cover potential working capital adjustments and approximately $12.5 million was placed into escrow to secure certain representations and warranties pursuant to the terms of the MyChem SPA. These amounts are included in the total purchase consideration of $257.9 million. The Company released the $1.0 million in escrow and paid out an additional $0.1 million related to net working capital adjustments during the fourth quarter of 2022. Because the remaining $12.5 million held in escrow is not controlled by the Company, it is not included in the accompanying consolidated balance sheet as of December 31, 2022. The following table summarizes the estimated fair values of MyChem’s identifiable intangible assets as of the date of acquisition and their estimated useful lives: Estimated Fair Value Estimated Useful Life Trade names $ 460 3 Developed technology 121,000 12 Customer relationships 1,900 12 Total $ 123,360 The trade name and customer relationship intangible assets are related to MyChem’s name, customer loyalty and customer relationships. The developed technology intangible asset is related to processes and techniques for synthesizing and developing ultra-pure nucleotides. The fair value of these intangible assets was based on MyChem’s projected revenues and was estimated using an income approach, specifically the multi-period excess earnings method. Under the income approach, an intangible asset’s fair value is equal to the present value of future economic benefits to be derived from ownership of the asset. The estimated fair value was developed by discounting future net cash flows to their present value at market-based rates of return utilizing Level 3 inputs. The useful lives for these intangible assets were determined based upon the remaining period for which the assets were expected to contribute directly or indirectly to future cash flows. Key quantitative assumptions used in the determination of fair value of the developed technology intangible included revenue growth rates ranging from 3.0% to 30.6%, a discount rate of 16.5% and an assumed technical obsolescent curve range of 5.0% to 7.5%. Pursuant to the terms of the MyChem SPA, the Company recognized an indemnification asset of $8.0 million within other assets, which represented the seller’s obligation to reimburse pre-acquisition income tax liabilities assumed in the acquisition and was recorded within other long-term liabilities. The carrying value of the remaining assets acquired or liabilities assumed was estimated to equal their fair values based on their short-term nature. These estimates were based on the assumption that the Company believes to be reasonable; however, actual results may differ from these estimates. Revenue and earnings from MyChem included in the Company’s consolidated statements of income since the date of acquisition were immaterial. No proforma revenue or earnings information for the years ended December 31, 2022 and 2021 have been presented as the impact was not determined to be material to the Company’s consolidated revenues and net income for the respective periods. Mock V Solutions, Inc. In March 2020, the Company acquired all of the outstanding shares of MockV Solutions, Inc. (“MockV”), a private entity, for $3.0 million, inclusive of acquisition costs of $0.2 million. The MockV technology acquired is a novel, proprietary viral clearance prediction tool that includes a non-infectious “mock virus particle” mimicking the physicochemical properties of live virus that may be present endogenously in the drug substance or introduced during bioproduction and will expand the Company biologics safety testing offerings. The transaction was accounted for as an asset acquisition as the acquired set of assets and activities did not meet the definition of a business. In connection with this acquisition, the Company acquired developed technology, an in-process research and development asset (“IPR&D”), an assembled workforce, and an insignificant amount of working capital balances. The relative fair value attributed to the acquired developed technology, assembled workforce, and working capital balances was insignificant. The IPR&D acquired was allocated a value of $2.9 million and the Company recognized a charge of $2.9 million related to the IPR&D as a component of research and development expenses on the consolidated statements of income because the technology had not yet reached technological feasibility and had no alternative future use. The Company must also make contingent cash payments (the “Earn-Outs”) of up to $9.0 million to the sellers of MockV based upon the achievement of long-term revenue targets. The Earn-Outs were determined to be contingent consideration that was not subject to derivative accounting and will be recognized when the contingency is resolved, and the consideration becomes paid or payable. As of December 31, 2022 and 2021, no such amounts were deemed to be payable. As the Company had no tax basis in the acquired IPR&D asset, and the acquired IPR&D asset was expensed prior to the measurement of any deferred taxes, no deferred taxes were recognized for the initial transaction. In November 2020, MockV was converted into a single member LLC and was deemed liquidated for income tax purposes. Divestiture Vector Laboratories, Inc. In August 2021, the Company entered into a definitive agreement to sell Vector to Voyager Group Holdings, Inc. (“Voyager”), a third-party unrelated to the Company, for an all cash sale price of $124.0 million, subject to purchase price adjustments. The Company determined that the fair value of Vector, less estimated costs to sell, exceeded the book value of the Vector Disposal Group and there were no other indicators of asset impairment prior to the sale. The divestiture was completed in September 2021, and final net proceeds were $120.7 million, which were inclusive of working capital adjustments. As a result of the divestiture, during the year ended December 31, 2021, the Company recognized a pre-tax gain on sale of $11.2 million, net of transactions costs of $0.9 million, in the consolidated statements of income. The Company’s Protein Detection segment was comprised of Vector. The sale of Vector represents a strategic shift as the Company will no longer be in the protein detection business after the sale. However, the sale did not qualify for presentation as discontinued operations since the sale of the Protein Detection segment did not have a major effect on the Company’s operations or financial results. In connection with the divestiture, the Company entered into a Transition Services Agreement (“TSA”) with Voyager to help support its ongoing operations. Under the TSA, the Company will provide certain transition services to Voyager, including information technology, finance and ERP, marketing and commercial, human resources, employee benefits, and other limited services. Depending on the service, the initial period ranges from one month to five months and the extension period ranges from one month to eight months. Income from performing services under the TSA was recorded within other income in the consolidated statements of income and was not significant for the year ended December 31, 2021. In August 2020, the Company entered into an agreement with an executive of Vector whereby the executive received incentive units of MLSH 1. In connection with the divestiture, MLSH 1 amended this executive’s incentive units resulting in the |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The Company’s goodwill of $283.7 million and $152.8 million as of December 31, 2022 and 2021 respectively, represents the excess of purchase consideration over the fair value of assets acquired and liabilities assumed. As of December 31, 2022 and 2021, the Company had three reporting units, two of which are contained in the Nucleic Acid Production segment. During the year ended December 31, 2022, the Company recorded goodwill of $130.9 million in connection with the acquisition of MyChem that was completed in January 2022 (see Note 2). The Company performed a qualitative goodwill impairment analysis on each of its three reporting units during the fourth quarter of 2022 and concluded that it was more likely than not that the fair value of goodwill exceeded its carrying value and no further testing was required. The Company has not recognized any goodwill impairment charges in any of the periods presented. The following table summarizes the activity in the Company’s goodwill by segment for the periods presented (in thousands): Nucleic Acid Production Biologics Safety Testing Total Balance as of December 31, 2021 $ 32,838 $ 119,928 $ 152,766 Acquisition 130,902 — 130,902 Balance as of December 31, 2022 $ 163,740 $ 119,928 $ 283,668 Intangible assets are being amortized on a straight-line basis, which reflects the expected pattern in which the economic benefits of the intangible assets are being obtained, over an estimated useful life ranging from 3 to 14 years. The following are components of finite-lived intangible assets and accumulated amortization as of the periods presented: December 31, 2022 Gross Accumulated Net Estimated Weighted (in thousands) (in years) (in years) Trade Names $ 7,580 $ 5,746 $ 1,834 3 - 10 3.5 Patents and Developed Technology 288,649 85,058 203,591 10 - 14 9.5 Customer Relationships 21,853 10,615 11,238 10 - 12 6.5 Total $ 318,082 $ 101,419 $ 216,663 9.3 December 31, 2021 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Estimated Useful Life Weighted Average Remaining Amortization Period (in thousands) (in years) (in years) Trade Names $ 7,120 $ 5,012 $ 2,108 5 - 10 2.9 Patents and Developed Technology 167,648 63,465 104,183 5 - 14 8.5 Customer Relationships 19,953 8,673 11,280 10 - 12 6.4 Total $ 194,721 $ 77,150 $ 117,571 8.1 During the first quarter of 2022, the Company recorded intangible assets of $123.4 million in connection with the acquisition of MyChem that was completed in January 2022 (see Note 2). The Company recognized $21.5 million, $12.4 million and $12.7 million of amortization expense from intangible assets directly linked with revenue generating activities within cost of revenue in the consolidated statements of income for the years ended December 31, 2022, 2021 and 2020, respectively. Amortization expense for intangible assets that are not directly related to sales generating activities of $2.8 million, $5.9 million and $7.6 million was recorded as selling, general and administrative expenses for each of the years ended December 31, 2022, 2021 and 2020, respectively. As of December 31, 2022, the estimated future amortization expense for finite-lived intangible assets were as follows (in thousands): 2023 $ 24,812 2024 24,812 2025 24,669 2026 24,432 2027 23,416 Thereafter 94,522 Total estimated amortization expense $ 216,663 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement | Fair Value Measurements The following table summarizes the Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands): Fair Value Measurement as of December 31, 2022 Level 1 Level 2 Level 3 Total Assets Interest rate cap $ — $ 11,362 $ — $ 11,362 Assets and liabilities measured at fair value on a recurring basis as of December 31, 2021 were insignificant. Contingent Consideration In connection with the acquisition of MyChem (see Note 2), the Company is required to make contingent payments to the sellers of up to $40.0 million, subject to achieving certain revenue thresholds. The preliminary fair value of the liability for the contingent payments recognized upon the acquisition as part of the purchase accounting opening balance sheet totaled $7.8 million. The preliminary fair value of the contingent consideration was determined using a Monte-Carlo simulation-based model discounted to present value. Assumptions used in this calculation are expected revenue, a discount rate of 16.9% and various probability factors. The ultimate settlement of the contingent consideration could deviate from current estimates based on the actual results of these financial measures. The contingent consideration projected year of payment is 2023. This liability is considered to be a Level 3 financial liability that is remeasured each reporting period. Changes in fair value of contingent consideration are recognized as a gain or loss and recorded within change in estimated fair value of contingent consideration in the consolidated statements of income. During the second quarter of 2022, the Company recorded a $7.8 million decrease in the estimated fair value of contingent consideration. This was due to a change in the estimate associated with MyChem revenue projections reaching thresholds that would trigger a contingent payment per the MyChem SPA. The following table provides a reconciliation of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the period presented (in thousands): Contingent Consideration Balance as of December 31, 2021 $ — Contingent consideration related to the acquisition of MyChem 7,800 Change in estimated fair value of contingent consideration (7,800) Balance as of December 31, 2022 $ — |
Balance Sheet Components
Balance Sheet Components | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Balance Sheet Components | Balance Sheet Components Inventory Inventory consisted of the following as of the periods presented (in thousands): December 31, 2022 December 31, 2021 Raw materials $ 13,486 $ 19,726 Work-in-process 21,950 21,382 Finished goods 7,716 10,449 Total inventory $ 43,152 $ 51,557 Property and equipment Property and equipment consisted of the following as of the periods presented (in thousands): December 31, 2022 December 31, 2021 Leasehold improvements $ 20,095 $ 18,162 Furniture, fixtures, and equipment 35,907 31,065 Software 3,004 2,713 Total 59,006 51,940 Less accumulated depreciation (19,502) (12,532) Total 39,504 39,408 Construction in-progress 13,190 6,924 Total property and equipment, net $ 52,694 $ 46,332 Depreciation expense totaled approximately $7.6 million, $6.4 million and $5.6 million for the years ended December 31, 2022, 2021 and 2020, respectively. Other assets Other assets consisted of the following as of the periods presented (in thousands): December 31, 2022 December 31, 2021 Right-of-use assets $ 63,896 $ 49,095 Prepaid lease payments 27,253 — Interest rate cap 11,362 541 Indemnification asset (see Note 2) 7,682 — Other 5,396 3,815 Total other assets $ 115,589 $ 53,451 Accrued expenses and other current liabilities Accrued expenses consisted of the following as of the periods presented (in thousands): December 31, 2022 December 31, 2021 Employee related $ 19,873 $ 18,894 Inventory holdback liability 10,000 — Accrued interest payable 7,700 145 Lease liabilities, current portion 6,269 3,722 Professional services 4,093 2,897 Customer deposits 1,665 2,429 Sales and use tax liability 1,029 1,296 Federal tax liability — 102 Other 2,742 5,089 Total accrued expenses and other current liabilities $ 53,371 $ 34,574 Other long-term liabilities Other long-term liabilities consisted of the following as of the periods presented (in thousands): December 31, 2022 December 31, 2021 Non-current lease liabilities $ 51,556 $ 40,906 Accrued Retention Payments (see Note 2) 9,324 — Acquisition related tax liability (see Note 2) 7,682 — Other 413 160 Total other long-term liabilities $ 68,975 $ 41,066 |
Government Assistance
Government Assistance | 12 Months Ended |
Dec. 31, 2022 | |
Government Assistance [Abstract] | |
Government Assistance | Government Assistance Cooperative Agreement In May 2022, TriLink entered into a cooperative agreement (the “Cooperative Agreement”) with the U.S. Department of Defense, as represented by the Joint Program Executive Office for Chemical, Biological, Radiological and Nuclear Defense on behalf of the Biomedical Advanced Research and Development Authority (“BARDA”), within the U.S. Department of Health and Human Services, to advance the development of domestic manufacturing capabilities and to expand TriLink’s domestic production capacity in its San Diego manufacturing campus (the “Flanders San Diego Facility”) for products critical to the development and manufacture of mRNA vaccines and therapeutics. Pursuant to certain requirements, BARDA awarded TriLink an amount equal to $38.8 million or 50% of the construction and validation costs currently budgeted for the Flanders San Diego Facility. The contract period of performance is May 2022 through December 2023, which is the effective date of the Cooperative Agreement through the anticipated date of completion of construction and validation of manufacturing capacity. Amounts reimbursed are subject to audit and may be recaptured by the U.S. Department of Defense in certain circumstances. The Cooperative Agreement requires the Company to provide the U.S. Government with conditional priority access and certain preferred pricing obligations for a 10-year period from the completion of the construction project for the production of a medical countermeasure (or a component thereof) that the Company manufactures in the Flanders San Diego Facility during a declared public health emergency. During the year ended December 31, 2022, the Company has received $18.1 million of reimbursements other assets property and equipment |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | Leases All of the Company's facilities, including office, laboratory and manufacturing space, are occupied under long-term non-cancelable operating lease arrangements with various expiration dates through 2037, some of which include options to extend up to 20 years. The Company does not have any leases that include residual value guarantees. In July 2022, the Company entered into a facility lease agreement for additional office, warehouse and light lab space in San Diego, California. The lease term began in July 2022 and will end in September 2026. In December 2022, the Company’s lease for a new manufacturing facility in Leland, North Carolina commenced. The Company entered into this lease in June 2021 and construction began in November 2021. The lease is for 10 years with the option to extend for four 5-year periods. The Company is reasonably certain to execute the first renewal option and has, therefore, recognized this as part of its ROU assets and lease liabilities. The lease includes tenant improvement provisions, rent abatement, and escalating rent payments over the life of the lease. The Company did not have any finance leases as of December 31, 2022 or 2021. The following table presents supplemental balance sheet information related to the Company's operating leases as of the periods presented below (in thousands): Line Item in the Consolidated Balance Sheet December 31, 2022 December 31, 2021 Right-of-use assets Other assets $ 63,896 $ 49,095 Lease liabilities, current portion Accrued expenses and other current liabilities 6,269 3,722 Non-current lease liabilities Other long-term liabilities 51,556 40,906 The components of the net lease costs reflected in the Company's consolidated statements of income were as follows for the periods presented (in thousands): Year Ended December 31, 2022 2021 Operating lease costs $ 8,800 $ 8,792 Variable lease costs 2,742 1,759 Total lease costs $ 11,542 $ 10,551 The weighted average remaining lease term and weighted average discount rate related to the Company's ROU assets and lease liabilities for its operating leases were as follows as of the periods presented below: December 31, 2022 December 31, 2021 Weighted average remaining lease term (in years) 7.9 8.2 Weighted average discount rate 6.5 % 5.1 % Supplemental information concerning the cash flow impact arising from the Company's leases recorded in the Company's consolidated statements of cash flows is detailed in the following table for the periods presented (in thousands): Year Ended December 31, 2022 2021 Cash paid for amounts included in lease liabilities: Operating cash flows used for operating leases $ 7,049 $ 6,335 Non-cash transactions: Right-of-use assets obtained in exchange for new operating lease liabilities $ 17,513 $ — As of December 31, 2022, the Company expects that its future minimum lease payments will become due and payable as follows (in thousands): Operating Leases 2023 $ 9,886 2024 10,304 2025 10,386 2026 9,455 2027 7,959 Thereafter 31,177 Total minimum lease payments $ 79,167 Less: interest (21,342) Total lease liabilities $ 57,825 As of December 31, 2022, the Company has entered into $37.1 million of contractually binding minimum lease payments for a lease executed but not yet commenced. This amount is excluded from the above tables and relates to the lease of the Flanders San Diego Facility, which consists of two buildings (“Flanders I” and “Flanders II”). |
Leases | Leases All of the Company's facilities, including office, laboratory and manufacturing space, are occupied under long-term non-cancelable operating lease arrangements with various expiration dates through 2037, some of which include options to extend up to 20 years. The Company does not have any leases that include residual value guarantees. In July 2022, the Company entered into a facility lease agreement for additional office, warehouse and light lab space in San Diego, California. The lease term began in July 2022 and will end in September 2026. In December 2022, the Company’s lease for a new manufacturing facility in Leland, North Carolina commenced. The Company entered into this lease in June 2021 and construction began in November 2021. The lease is for 10 years with the option to extend for four 5-year periods. The Company is reasonably certain to execute the first renewal option and has, therefore, recognized this as part of its ROU assets and lease liabilities. The lease includes tenant improvement provisions, rent abatement, and escalating rent payments over the life of the lease. The Company did not have any finance leases as of December 31, 2022 or 2021. The following table presents supplemental balance sheet information related to the Company's operating leases as of the periods presented below (in thousands): Line Item in the Consolidated Balance Sheet December 31, 2022 December 31, 2021 Right-of-use assets Other assets $ 63,896 $ 49,095 Lease liabilities, current portion Accrued expenses and other current liabilities 6,269 3,722 Non-current lease liabilities Other long-term liabilities 51,556 40,906 The components of the net lease costs reflected in the Company's consolidated statements of income were as follows for the periods presented (in thousands): Year Ended December 31, 2022 2021 Operating lease costs $ 8,800 $ 8,792 Variable lease costs 2,742 1,759 Total lease costs $ 11,542 $ 10,551 The weighted average remaining lease term and weighted average discount rate related to the Company's ROU assets and lease liabilities for its operating leases were as follows as of the periods presented below: December 31, 2022 December 31, 2021 Weighted average remaining lease term (in years) 7.9 8.2 Weighted average discount rate 6.5 % 5.1 % Supplemental information concerning the cash flow impact arising from the Company's leases recorded in the Company's consolidated statements of cash flows is detailed in the following table for the periods presented (in thousands): Year Ended December 31, 2022 2021 Cash paid for amounts included in lease liabilities: Operating cash flows used for operating leases $ 7,049 $ 6,335 Non-cash transactions: Right-of-use assets obtained in exchange for new operating lease liabilities $ 17,513 $ — As of December 31, 2022, the Company expects that its future minimum lease payments will become due and payable as follows (in thousands): Operating Leases 2023 $ 9,886 2024 10,304 2025 10,386 2026 9,455 2027 7,959 Thereafter 31,177 Total minimum lease payments $ 79,167 Less: interest (21,342) Total lease liabilities $ 57,825 As of December 31, 2022, the Company has entered into $37.1 million of contractually binding minimum lease payments for a lease executed but not yet commenced. This amount is excluded from the above tables and relates to the lease of the Flanders San Diego Facility, which consists of two buildings (“Flanders I” and “Flanders II”). |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Proceedings The Company is involved in various legal proceedings arising in the normal course of business. The Company accrues for a loss contingency when it determines that it is probable, after consultation with counsel, that a liability has been incurred and the amount of such loss can be reasonably estimated. The Company believes that the results of any such contingencies, either individually or in the aggregate, will not have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows. Indemnification Agreements In the ordinary course of business, we may provide indemnification of varying scope and terms to vendors, lessors, customers and other parties with respect to certain matters including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties, and losses arising from breach of representations, warranties and covenants to counterparties set forth in agreements with such parties. We have also agreed to our directors and officers to the maximum extent permitted under applicable state laws pursuant to standard director and officer indemnification agreements and our corporate charter and bylaws. The maximum potential amount of future payments that we could be required to make under these indemnification agreements is, in many cases, unlimited. We have not incurred any material costs as a result of such indemnifications and are not currently aware of any indemnification claims. |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Credit Agreement In October 2020, Maravai Intermediate Holdings, LLC (“Intermediate”), a wholly-owned subsidiary of Topco LLC, along with its subsidiaries Vector, TriLink and Cygnus (together with Intermediate, the “Borrowers”), entered into a credit agreement (as amended, the “Credit Agreement”) to refinance previously existing $400.0 million long-term debt with a new $780.0 million facility. The Credit Agreement provides for a $600.0 million term loan facility, maturing October 2027 (the “Term Loan”), and a $180.0 million revolving credit facility (the “Revolving Credit Facility”). The Credit Agreement amended and restated the Company’s prior credit agreement as of August 2018 (the “First and Second Lien Credit Agreements”). In November 2020, the Company repaid $50.0 million of principal balance of the First Lien Term Loan using proceeds from the IPO. In August 2021, in conjunction with the Company’s divestiture of the Protein Detection segment, the Company transferred, per the existing terms of the Credit Agreement, the portion of the Term Loan held by Vector of $118.4 million to Intermediate in its entirety. This amount was not assumed by the counterpart as part of the divestiture of Vector. Total outstanding debt and loan covenant requirements remained unchanged as a result of the divestiture. In January 2022, the Company entered into an amendment (the “Amendment”) to the Credit Agreement to: (i) refinance $544.0 million in aggregate principal amount of first lien term loans initially issued thereunder (the “First Lien Term Loan”) and to replace it with a Tranche B Term Loan (the “Tranche B Term Loan”); (ii) replace the London Interbank Offered Rate (“LIBOR”) based interest rate with a Term Secured Overnight Financing Rate (“SOFR”) based rate; and (iii) reduce the interest rate margins applicable to the Term Loan and Revolving Credit Facility under the Credit Agreement. The previous interest rate margin on the facilities was, with respect to each LIBOR-based loan, 3.75% to 4.25% and, with respect to each base rate-based loan, 2.75% to 3.25% (depending, in each case, on consolidated first lien leverage). Following the Amendment, the interest rate margin on the facilities is 3.00%, with respect to each Term SOFR-based loan, and 2.00%, with respect to each base rate-based loan. Further, the Amendment reduces the base rate floor for the term loans from 2.00% to 1.50%, sets the floor for Term SOFR-based term loans at 0.50% and sets the floor for Term SOFR-based revolving loans at 0.00%. No other significant terms under the Credit Agreement were changed in connection with the Amendment. As of December 31, 2022, the interest rate on the Tranche B Term Loan was 6.96% per annum. The Credit Agreement also provides for a $20.0 million limit for letters of credit, which remained unused as of December 31, 2022. Borrowings under the Credit Agreement are unconditionally guaranteed by Topco LLC, together with the existing and future material domestic subsidiaries of Topco LLC (subject to certain exceptions), as specified in the respective guaranty agreements. Borrowings under the Credit Agreement are also secured by a first-priority lien and security interest in substantially all of the assets (subject to certain exceptions) of existing and future material domestic subsidiaries of Topco LLC that are loan parties. The accounting related to entering into the Credit Agreement in October 2020 and using the proceeds to pay off the First and Second Lien Credit Agreements were evaluated on a creditor-by-creditor basis to determine whether each transaction should be accounted for as a modification or extinguishment. Certain creditors under the First and Second Lien Credit Agreements did not participate in this refinancing transaction and ceased being creditors of the Company and the repayment of their related outstanding debt balances has been accounted for as an extinguishment of debt. Proceeds of borrowings from new lenders were accounted for as a new debt financing. The Company recorded a loss on extinguishment of debt of $7.6 million in the accompanying consolidated statements of income for the year ended December 31, 2020. For the remainder of the creditors, this transaction was accounted for as a modification because the present value of cash flows between the two term loans before and after the transaction was less than 10% on a creditor-by-creditor basis. As part of the refinancing, the Company incurred $15.8 million of various costs, of which $6.0 million related to an original issuance discount, and were all capitalized in the accompanying balance sheet within long-term debt, and are subject to amortization over the term of the refinanced debt as an adjustment to interest expense using the effective interest method. The accounting related to entering into the Amendment in January 2022 was evaluated on a creditor-by-creditor basis to determine whether each transaction should be accounted for as a modification or extinguishment. Certain creditors under the First Lien Term Loan did not participate in this refinancing transaction, were repaid their principal and interest of $8.5 million and ceased being creditors of the Company and the repayment of their related outstanding debt balances has been accounted for as an extinguishment of debt. Proceeds of borrowings from new lenders of $8.5 million were accounted for as a new debt financing. The Company recorded a loss on extinguishment of debt of $0.2 million in the accompanying consolidated statements of income during the year ended December 31, 2022. For the remainder of the creditors, this transaction was accounted for as a modification because the change in present value of cash flows between the two term loans before and after the transaction was less than 10% on a creditor-by-creditor basis. As part of the refinancing, the Company incurred $0.9 million of various costs, of which an insignificant amount was related to an original issuance discount, and were all capitalized in the accompanying balance sheet within long-term debt and are subject to amortization over the term of the refinanced debt as an adjustment to interest expense using the effective interest method. We also incurred $3.5 million and $0.3 million of financing-related fees related to the Revolving Credit Facility in connection with the debt refinancing activities in October 2020 and January 2022, respectively. As of December 31, 2022, unamortized debt issuance costs totaled $2.2 million and are recorded as assets within other assets on the accompanying consolidated balance sheet as there is no balance outstanding related to the Revolving Credit Facility. Commencing with the fiscal year ended December 31, 2021, and each fiscal year thereafter, the Credit Agreement requires mandatory prepayments on the Term Loan principal upon certain excess cash flow, subject to certain step-downs based on the Company’s first lien net leverage ratio. The excess cash flow shall be reduced to 25% or 0% if the first lien net leverage ratio was equal to or less than 4.75:1.00 or 4.25:1.00, respectively, however, no prepayment shall be required to the extent excess cash flow calculated for such period is equal to or less than $10.0 million. As of December 31, 2022, our first lien net leverage ratio was less than 4.25:1.00. Thus, a prepayment provision was not required. The Tranche B Term Loan became repayable in quarterly payments of $1.4 million beginning in March 2022, with all remaining outstanding principal due in October 2027. The Tranche B Term Loan includes prepayment provisions that allow the Company, at our option, to repay all or a portion of the principal amount at any time. The Revolving Credit Facility allows the Company to repay and borrow from time to time until October 2025, at which time all amounts borrowed must be repaid. Subject to certain exceptions and limitations, we are required to repay borrowings under the Tranche B Term Loan and Revolving Credit Facility with the proceeds of certain occurrences, such as the incurrence of debt, certain equity contributions and certain asset sales or dispositions. Accrued interest under the Credit Agreement is payable by us (a) quarterly in arrears with respect to Base Rate loans, (b) at the end of each interest rate period (or at each three-month interval in the case of loans with interest periods greater than three months) with respect to Term SOFR Rate loans, (c) on the date of any repayment or prepayment and (d) at maturity (whether by acceleration or otherwise). An annual commitment fee is applied to the daily unutilized amount under the Revolving Credit Facility at 0.375% per annum, with one stepdown to 0.25% per annum based on Intermediate’s first lien net leverage ratio calculation. The Credit Agreement contains certain covenants, including, among other things, covenants limiting our ability to incur or prepay certain indebtedness, pay dividends or distributions, dispose of assets, engage in mergers and consolidations, make acquisitions or other investments and make changes to the nature of the business. Additionally, the Credit Agreement also requires us to maintain a certain net leverage ratio. The Company was in compliance with these covenants as of December 31, 2022. First and Second Lien Credit Agreements In August 2018, Intermediate, along with its subsidiaries, entered into a first lien credit agreement (the “First Lien Credit Agreement”) with leading institutions for term loan borrowings (the “First Lien Term Loan”) totaling $250.0 million and a second lien credit agreement (the “Second Lien Credit Agreement”) for term loan borrowings (the “Second Lien Term Loan”) totaling $100.0 million, to refinance a combined debt agreement entered into in 2017, including repayment of all outstanding senior secured credit facilities and senior subordinated notes outstanding and to allow for a $52.0 million distribution to our members. The First Lien Credit Agreement also provided for a revolving credit facility (the “Revolving Credit Facility”) of $50.0 million for letters of credit and loans to be used for working capital and other general corporate financing purposes, of which $15.0 million was drawn down in March 2020 to provide financing for the acquisition of MockV and other operating uses. Borrowings under the First Lien Credit Agreement and the Second Lien Credit Agreement were unconditionally guaranteed by Topco LLC and the existing and future material domestic subsidiaries of Topco LLC (subject to certain exceptions as specified in the respective guaranty agreements, and are secured by a lien and security interest in substantially all of the assets of existing and future material domestic subsidiaries of Topco LLC that are loan parties). The refinancing of the previous debt was accounted for as a modification and also as an extinguishment of the related outstanding debt balances. Borrowings under the First Lien Credit Agreement bore interest at variable rates as defined in the respective agreements that could be elected at our option. Accrued interest under the First Lien Credit Agreement was generally payable quarterly in arrears on the date of any repayment or prepayment and at maturity. An annual commitment fee was applied to the daily unutilized amount under the Revolving Credit Facility at 0.50% per annum, with one stepdown to 0.375% per annum based on Intermediate’s first lien net leverage ratio calculation. Interest Rate Cap In the first quarter of 2021, the Company entered into an interest rate cap agreement to manage a portion of its variable interest rate risk on its outstanding long-term debt. The contract, which was effective March 31, 2021, entitles the Company to receive from the counterparty at each calendar quarter end the amount, if any, by which a specified defined floating market rate exceeds the cap strike interest rate, applied to the contract’s notional amount of $415.0 million The floating rate of interest is reset at the end of each three month period. The contract was set to expire on March 31, 2023. In May 2022, the Company amended the interest rate cap agreement, effective June 30, 2022, to increase the contract’s notional amount to $500.0 million and to extend the maturity date to January 19, 2025. Additionally, the floating rate option changed from a LIBOR-based rate to a SOFR-based rate. Other provisions remained unchanged as a result of the amendment. Premiums paid to amend the interest rate cap agreement were immaterial. The interest rate cap agreement has not been designated as a hedging relationship and has been recognized on the consolidated balance sheet at fair value of $11.4 million within other assets with changes in fair value recognized within interest expense in the consolidated statements of income. The Company’s long-term debt consisted of the following as of the periods presented (in thousands): December 31, 2022 December 31, 2021 Tranche B Term Loan $ 538,560 $ — First Lien Term Loan — 544,000 Unamortized debt issuance costs (11,123) (13,409) Total long-term debt 527,437 530,591 Less: current portion (5,440) (6,000) Total long-term debt, less current portion $ 521,997 $ 524,591 There were no balances outstanding on the Company’s Revolving Credit Facility as of December 31, 2022. As of December 31, 2022, the aggregate future principal maturities of the Company’s debt obligations for each of the next five years, based on contractual due dates, were as follows (in thousands): 2023 $ 5,440 2024 5,440 2025 5,440 2026 5,440 2027 516,800 Total long-term debt $ 538,560 |
Stockholders' _ Member's Equity
Stockholders' / Member's Equity | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Stockholders' / Member's Equity | Stockholders’ / Member’s Equity Initial Public Offering In November 2020, the Company completed its IPO and sold 69,000,000 shares of Class A common stock at a public offering price of $27.00 per share, inclusive of the 9,000,000 shares of Class A common stock purchased by underwriters pursuant to the underwriters’ option to purchase additional shares at the initial public offering price, less underwriting discounts and commissions. The Company received net proceeds from the IPO of approximately $1.8 billion after deducting underwriting discounts and commissions, which was used to purchase 55,823,011 of previously-issued and 3,703,704 of newly-issued Topco LLC Units for approximately $94.5 million. Immediately prior to, and in connection with, the completion of our IPO, the Company completed a series of organizational transactions (“Organizational Transactions”), including: • The amendment and restatement of Topco LLC’s operating agreement (the “New LLC Operating Agreement”) to, among other things, (i) modify Topco LLC’s capital structure by replacing the membership interests held by Topco LLC’s existing owners with a new class of Topco LLC units (the “LLC Units”) and (ii) appoint the Company as the sole managing member of Topco LLC. • Amend and restate the Company’s certificate of incorporation to among other things, authorize the Company to issue two classes of common stock: Class A common stock and Class B common stock. • The issuance of shares of the Company’s Class B common stock to Maravai Life Sciences Holdings, LLC (“MLSH 1”) which was Topco LLC’s pre-IPO owner on a one-to-one basis with the number of LLC Units owned; and • The acquisition, by merger, of two members of Topco LLC (“the Blocker Entities”), for which we issued 28,965,664 shares of Class A common stock and paid cash of $208.1 million as consideration (“the Blocker Mergers”). Prior to the Organizational Transactions, Topco LLC had established a single class of common units with MLSH 1 as its sole member. Topco LLC was authorized to issue up to 253,916,941 common units. All authorized 253,916,941 common units were issued and outstanding prior to the Organizational Transactions. MLSH 1 as the member, was not obligated to make capital contributions to Topco LLC. Topco LLC’s profits and losses were allocated to MLSH 1 as determined by the Board of Directors. Topco LLC’s common units have no conversion rights, special preferences or redemption rights. Prior to the Organizational Transactions, a distribution was made by Topco LLC to MLSH 1 in the amount of $88.6 million, with a subsequent distribution of $8.2 million in December 2020, totaling $96.7 million of distributions for the year ended December 31, 2020. Amendment and Restatement of Certificate of Incorporation In connection with the Organizational Transactions, the Company’s certificate of incorporation was amended and restated to, among other things, provide for the (i) authorization of 500,000,000 shares of Class A common stock with a par value of $0.01 per share; (ii) authorization of 300,000,000 shares of Class B common stock with a par value of $0.01 per share; (iii) authorization of 50,000,000 shares of preferred stock with a par value of $0.01 per share. Holders of Class A and Class B common stock are entitled to one vote per share. Except as otherwise required in the Certificate of Incorporation or by applicable law, the holders of Class A common stock and Class B common stock shall vote together as a single class on all matters on which stockholders are generally entitled to vote. Holders of the Class A common stock are entitled to receive dividends, and upon the Company’s dissolution or liquidation, after payment in full of all amounts required to be paid to creditors and to the holders of preferred stock having liquidation preferences, if any, the holders of shares of Class A common stock will be entitled to receive the Company’s pro rata remaining assets available for distribution. Holders of Maravai’s Class B common stock are not entitled to receive dividends and will not be entitled to receive any distributions upon dissolution or liquidation of Maravai. Holders of Class A and Class B common stock do not have preemptive or subscription rights. As of December 31, 2022, no preferred stock was outstanding. We are required to, at all times, maintain (i) a one-to-one ratio between the number of shares of Class A common stock outstanding and the number of LLC Units owned by us and (ii) a one-to-one ratio between the number of shares of Class B common stock owned by the MLSH 1 and the number of LLC Units owned by the MLSH 1. We may issue shares of Class B common stock only to the extent necessary to maintain these ratios. Shares of Class B common stock are transferable only together with an equal number of LLC Units if we, at the election of MLSH 1, exchange LLC Units for shares of Class A common stock. All Class B common stock that is transferred shall be automatically retired and cancelled and shall no longer be outstanding. In November 2020, we received $1.7 million from MLSH 1 for the issuance of 168,654,981 shares of Class B common stock. Recapitalization of Topco LLC Topco LLC’s Board of Directors adopted the amended and restated Topco LLC’s operating agreement in November 2020 to, among other things, appoint us as Topco LLC’s sole managing member and to provide that Topco LLC’s members would not have voting rights or any other control or authority over Topco LLC or its business. The amended and restated operating agreement also revised the tax rate applicable to the tax distributions that Topco LLC is required to make to the holders of LLC Units, including us, as described in Note 14. Blocker Mergers Pursuant to the Blocker Mergers, we acquired the Blocker Entities (together with 37,119,801 LLC Units held by the Blocker Entities), by merger, from MLSH 2. We issued an aggregate of 28,965,664 shares of Class A common stock and paid $208.1 million in cash to MLSH 2 in consideration of the Blocker Mergers. Upon consummation of the Blocker Mergers, we recognized the acquired LLC Units at carrying value, as these transactions are considered to be between entities under common control. There were no tax attributes acquired from the Blocker Entities as they had been fully utilized prior to the mergers. Repurchase of Class A Common Stock From MLSH 2 In November 2020, we repurchased 1,319,148 shares of Class A common stock from MLSH 2, a related party, for $33.7 million. These shares were immediately retired. Exchanges and Secondary Offerings April 2021 Exchange and Secondary Offering In April 2021, MLSH 1 executed an exchange of 17,665,959 LLC Units (paired with the corresponding shares of Class B common stock) in return for 17,665,959 shares of the Company’s Class A common stock. The corresponding shares of Class B common stock were subsequently cancelled and retired. The Company immediately completed a secondary offering (“April 2021 Secondary Offering”) of 20,700,000 shares of its Class A common stock by MLSH 1 and MLSH 2, which included 3,034,041 shares of Class A common stock previously held by MLSH 2, which included the full exercise of the underwriters’ option to purchase up to 2,700,000 additional shares of Class A common stock, at a price of $31.25 per share. The selling stockholders were responsible for the underwriting discounts and commissions of the April 2021 Secondary Offering and received all of the net proceeds of $624.2 million from the sale of shares of Class A common stock. The Company was responsible for the offering costs associated with the April 2021 Secondary Offering of $1.0 million which were recorded within selling, general and administrative expenses in the consolidated statements of income. September 2021 Exchange and Secondary Offering In September 2021, MLSH 1 executed an exchange of 17,068,559 LLC Units (paired with the corresponding shares of Class B common stock) in return for 17,068,559 shares of the Company’s Class A common stock. The corresponding shares of Class B common stock were subsequently cancelled and retired. Shortly after the exchange, the Company completed a secondary offering (“September 2021 Secondary Offering”) of 20,000,000 shares of its Class A common stock by MLSH 1 and MLSH 2, which included 2,931,441 shares of Class A common stock previously held by MLSH 2 at a price of $50.00 per share. The selling stockholders were responsible for the underwriting discounts and commissions of the September 2021 Secondary Offering and received all of the net proceeds of $977.5 million from the sale of shares of Class A common stock. The Company was responsible for the offering costs associated with the September 2021 Secondary Offering of $0.9 million which were recorded within selling, general and administrative expenses in the consolidated statements of income. Cash Contribution, Exchange, and Forfeiture Agreement In December 2021, the Company entered into a Cash Contribution, Exchange and Forfeiture Agreement (the “Contribution Agreement”) with Topco LLC and MLSH 1, a related party. Pursuant to the Contribution Agreement, the Company contributed $110.0 million of cash to Topco LLC in exchange for 2,732,919 newly-issued units LLC Units of Topco LLC at a price per unit of $40.25, which was equal to the 50-day volume-weighted average price of the Company’s Class A common stock as calculated on December 31, 2021. Immediately following the contribution, the Company and MLSH 1 agreed to forfeit 2.036% of their respective LLC Units of Topco LLC and an equal number of shares of the Company’s Class B common stock, par value $0.01 per share, for no consideration. The purpose of the Contribution Agreement was to reduce the excess cash that had accumulated at the Company as a result of quarterly tax distributions it has received from Topco LLC since its IPO. |
Net Income Per Class A Common S
Net Income Per Class A Common Share/Unit Attributable to Maravai LifeSciences Holdings, Inc. | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Net Income Per Class A Common Share/Unit Attributable to Maravai LifeSciences Holdings, Inc. | Net Income Per Class A Common Share/Unit Attributable to Maravai LifeSciences Holdings, Inc. Net income per unit for periods prior to our IPO have not been retrospectively adjusted to give effect to the Organizational Transactions described in Note 10 and the 69,000,000 shares of Class A common stock sold in our IPO. Additionally, basic net income per Class A common stock for the year ended December 31, 2020, has been calculated by dividing net income for the period, adjusted for preferred unit dividends attributable to MLSC non-controlling interests and net income (loss) attributable to non-controlling interests, by the weighted average Class A common stock outstanding during the period. Basic net income per Class A common stock for the years ended December 31, 2022 and 2021, have been calculated by dividing net income for the period, adjusted for net income attributable to non-controlling interests, by the weighted average Class A common stock outstanding during the period. Diluted net income per Class A common share/unit gives effect to potentially dilutive securities by application of the treasury stock method or if-converted method, as applicable. Diluted net income per share of Class A common stock attributable to the Company is computed by adjusting the net income and the weighted-average number of shares of Class A common stock outstanding to give effect to potentially diluted securities. Prior to the Organizational Transactions, the members’ equity of MLSC was comprised of Class A and Class B preferred units, MLSC Incentive Units and MLSC common units, each with participation rights. The MLSC preferred units were entitled to cumulative dividends of 8.0% compounded annually, up to an additional 4.0%, also compounded annually, to the extent of remaining unallocated earnings. The preferred unitholders of MLSC were required, however, to share a portion of the additional 4.0% in dividends with the holders of MLSC Incentive Units based on a formula defined in the MLSC LLC Agreement. The Company determined that vested MLSC Incentive Units and MLSC Class A and B preferred units were participating securities under the two-class method at the MLSC subsidiary level, however, they do not have a contractual obligation to share in losses, and therefore no undistributed losses have been allocated to them. MLSH 1 Incentive Units are granted by the parent of the Company, and as a result, do not represent potential common units of the Company. In September 2020, the Company entered into a Sale and Rollover Agreement and repurchased a majority of the outstanding MLSC Class B preferred units as well as entering into an agreement that resulted in an exchange of the remaining MLSC Class B preferred units and MLSC common units into 69,599 of MLSH 1 common units in November 2020 upon the IPO. Included in the preferred unit dividends attributable to non-controlling interests line item for the year ended December 31, 2020, is a $10.2 million deemed dividend representing the excess of the fair value of the Class B preferred units, determined as of the date of the Sale and Rollover Agreement, over their related carrying value. In September 2020, the Company also agreed and subsequently repurchased all MLSC Incentive Units, however, such incentive units remained outstanding until October 2020, and had the potential to be dilutive to earnings per unit until they were repurchased. The following table presents the computation of basic and diluted net income per common share/unit attributable to the Company for the periods presented (in thousands, except per share and per unit amounts): Year Ended December 31, 2022 2021 2020 Numerator: Net income $ 490,663 $ 469,250 $ 78,816 Less: preferred unit dividends attributable to the MLSC non-controlling interests — — (15,270) Less: (income) loss attributable to common non-controlling interests (270,458) (287,213) 13,342 Net income attributable to Maravai LifeSciences Holdings, Inc.—basic 220,205 182,037 76,888 Net income (loss) effect of dilutive securities: Effect of dilutive employee stock purchase plan, RSUs and options $ 87 132 — Effect of the assumed conversion of Class B common stock 205,984 220,187 (8,802) Net income attributable to Maravai LifeSciences Holdings, Inc.—diluted $ 426,276 $ 402,356 $ 68,086 Denominator: Weighted average Class A common shares/units outstanding—basic 131,545 114,791 10,351 Weighted average effect of dilutive securities: Effect of dilutive employee stock purchase plan, RSUs and options 109 153 1 Effect of the assumed conversion of Class B common stock 123,669 142,859 18,556 Weighted average Class A common shares/units outstanding—diluted 255,323 257,803 28,908 Net income per Class A common share/unit attributable to Maravai LifeSciences Holdings, Inc.: Basic $ 1.67 $ 1.59 $ 7.43 Diluted $ 1.67 $ 1.56 $ 2.36 Shares of Class B common stock do not share in the earnings or losses of the Company, and are therefore not participating securities. As such, a separate presentation of basic and diluted net income per share for Class B common stock under the two-class method has not been presented. The following table presents potentially dilutive securities excluded from the computation of diluted net income per share/unit for the periods presented because their effect would have been anti-dilutive for the periods presented (in thousands): Year Ended December 31, 2022 2021 2020 Restricted stock units 74 — — Stock options 2,769 355 1,535 Shares estimated to be purchased under employee stock purchase plan 13 12 51 Total 2,856 367 1,586 Shares underlying contingently issuable awards that have not met the necessary conditions as of the end of a reporting period are not included in the calculation of diluted net income per share of Class A common stock attributable to the Company for that period. The Company had contingently issuable PSUs outstanding that did not meet the market conditions as of December 31, 2022 and, therefore, were excluded from the calculation of diluted net income per share of Class A common stock attributable to the Company. The maximum number of potentially dilutive shares that could be issued upon vesting for such awards was insignificant as of December 31, 2022. These amounts were also excluded from the potentially dilutive securities in the table above. The Company had no contingently issuable PSUs outstanding as of December 31, 2021 or 2020. |
Equity Incentive Plans
Equity Incentive Plans | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Equity Incentive Plans | Equity Incentive Plans Stock-Based Compensation In November 2020, the Company’s board of directors adopted the 2020 Omnibus Incentive Plan (the “2020 Plan”). The 2020 Plan provides for an automatic increase in the number of shares reserved for issuance thereunder on January 1 of each of the first 10 calendar years during the term of the 2020 Plan, by the lesser of (i) 4% of the total number of shares of Class A common stock outstanding on each December 31 immediately prior to the date of increase or (ii) such number of shares of Class A common stock determined by our board of directors or compensation committee. Shares of Class A common stock subject to an award that expires or is cancelled, forfeited, exchanged, settled in cash or otherwise terminated without delivery of shares and shares withheld to pay the exercise price of, or to satisfy the withholding obligations with respect to, an award will again be available for delivery pursuant to other awards under the 2020 Plan. All awards granted under the 2020 Plan are intended to be treated as (i) stock options, including incentive stock options (“ISOs”), (ii) stock appreciation rights (“SARs”), (iii) restricted share awards (“RSAs”), (iv) restricted stock units (“RSUs”), (v) performance awards, (vi) dividend equivalents, or (vii) other stock or cash awards as may be determined by the plan’s administrator from time to time. The term of each option award shall be no more than 10 years from the date of grant. The exercise price of a stock option shall not be less than 100% (or, in the case of an ISO granted to a ten percent stockholder, 110%) of the fair market value of the shares on the date of grant. As of December 31, 2022, only stock options, RSUs and PSUs have been issued. In November 2020, the Company adopted the 2020 Employee Stock Purchase Plan (the “ESPP”) to assist employees in acquiring a stock ownership interest in the Company and to encourage them to remain in the employment of the Company. The ESPP permits eligible employees to purchase shares of Class A common stock at a discount through payroll deductions during specified six-month purchase periods. The price of shares purchased under the ESPP is equal to the lower of the grant date price less a 15% discount or a 15% discount to the market closing price on the date of purchase. Compensation expense recognized for the ESPP was insignificant for all periods presented. In October 2022, the Company issued PSUs to an executive employee under the 2020 Plan. The PSUs vest only if the executive employee satisfies a service-based vesting condition and market condition. The executive employee must remain employed through the third anniversary of the grant date. The award is eligible to vest based on the achievement of certain price targets of the Company’s stock price over a defined performance period. Compensation expense recognized for these PSUs was insignificant for the year ended December 31, 2022. There was no compensation expense related to PSUs during the years ended December 31, 2021 or 2020. Stock Options The following table summarizes information related to stock options: Number of Stock Options Weighted Average Exercise Price per Stock Option Weighted Average Remaining Contractual Life Aggregate Intrinsic Value Outstanding as of December 31, 2021 1,409 $ 30.47 9.0 $ 16,846 Granted 1,709 23.81 Exercised (4) 26.08 Cancelled (221) 31.64 Outstanding as of December 31, 2022 2,893 $ 26.45 8.9 $ — Exercisable as of December 31, 2022 726 $ 28.75 8.2 $ — The Company uses the Black-Scholes option pricing model to estimate the fair value of each option grant on the date of grant or any other measurement date. The assumptions and estimates are as follows: • Expected term - The expected term represents the period that stock-based awards are expected to be outstanding. Our historical share option exercise information is limited due to a lack of sufficient data points and does not provide a reasonable basis upon which to estimate an expected term. • Expected volatility - The expected volatility was derived from the historical stock volatilities of peer public companies within our industry that are considered to be comparable to our business over a period equivalent to the expected term of the stock-based awards, since our stock trading history is limited. • Risk-free interest rate - The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the date of grant for zero-coupon U.S. Treasury notes with maturities approximately equal to the stock-based awards’ expected term. • Expected dividend yield - The expected dividend yield is zero as we have no plans to make dividend payments. A summary of the assumptions used to estimate the fair value of stock option grants for the years presented is as follows: Year Ended December 31, 2022 2021 2020 Expected volatility 51.3 % 57.2 % 59.0 % Risk-free interest rate 2.8 % 1.0 % 0.5 % Expected term (in years) 6.1 6.1 6.1 Expected dividend yield — % — % — % Stock-based compensation expense related to stock options was $8.1 million, $4.6 million and $0.6 million for the years ended December 31, 2022, 2021 and 2020, respectively. The total fair value of stock options vested was $7.7 million and $4.3 million for the years ended December 31, 2022 and 2021, respectively. As of December 31, 2022, the total unrecognized stock-based compensation related to stock options was $27.7 million, which is expected be recognized over a weighted-average period of approximately 3.0 years. Restricted Stock Units The Company has granted restricted stock unit awards to employees and non-employee directors. The following table summarizes information related to RSUs: Restricted Stock Units Weighted Average Fair Value per RSU at Grant Date Balance as of December 31, 2021 90 $ 31.96 Granted 1,375 23.99 Vested (69) 33.25 Forfeited (65) 27.30 Balance as of December 31, 2022 1,331 $ 21.04 Stock-based compensation expense related to RSUs was $8.2 million, $0.8 million and $0.1 million for the years ended December 31, 2022, 2021 and 2020, respectively. The total fair value of RSUs vested was $1.0 million and $0.9 million for the years ended December 31, 2022 and 2021, respectively. As of December 31, 2022, the total unrecognized equity-based compensation related to RSUs was $25.7 million, which is expected be recognized over a weighted-average period of approximately 2.4 years. Unit-Based Compensation Prior to the IPO, the Company’s parent, MLSH 1, granted unit-based awards (“MLSH 1 Incentive Units”) to certain executives of the Company in the form of non-vested units. Our controlled subsidiary, MLSC, granted unit-based awards (“MLSC Incentive Units”) only to certain employees of its subsidiaries. MLSC Incentive Units Topco LLC’s majority-owned subsidiary during the periods preceding the Organizational Transactions and wholly-owned subsidiary subsequent to the Organizational Transactions, issued incentive units (the “MLSC Incentive Units”) to its employees. All MLSC Incentive Units were settled during 2020. The MLSC Incentive Units were subject to either a combination of service, market or performance vesting conditions. Vested MLSC Incentive Units were treated as common units for purposes of distributions. In September 2020, Topco LLC entered into agreements (the “Repurchase Agreements”) to repurchase all remaining and outstanding MLSC Incentive Units, including the 1,500,000 MLSC Incentive Units, accelerated the vesting of all remaining unvested time-based MLSC Incentive Units and also removed the performance condition associated with the performance-based MLSC Incentive Units. The total compensation cost recognized for these transactions approximated $0.8 million. Topco LLC paid $9.1 million to settle the Repurchase Agreements in October 2020. Unit-based compensation expense related to MLSC Incentive Unit awards was approximately $1.5 million for the year ended December 31, 2020. The total fair value of the MLSC Incentive Units vested was $0.9 million for the year ended December 31, 2020. MLSH 1 Incentive Units Prior to the Organizational Transactions, Topco LLC entered into agreements with certain executives and board members whereby those employees and board members were granted incentive units in MLSH 1, a related party. All MLSH 1 Incentive Unit awards were subject to a market condition which is subject to the achievement of a certain investment return threshold that increased on a compounding basis annually and a service condition subject to their continued employment. Certain MLSH 1 Incentive Unit awards contained a performance condition tied to the achievement of certain cash distribution multiples. All vested MLSH 1 Incentive Unit awards are subject to repurchase for fair value at MLSH 1’s option upon a voluntary or involuntary separation event that is not deemed to be for cause. Upon the IPO, the performance condition was met for certain MLSH 1 Incentive Units and the Company recorded an additional $3.5 million of equity-based compensation expense. The MLSH 1 Incentive Unit awards that include market and service conditions provide for cliff-vesting generally over four In November 2020, and before the IPO, MLSH 1 Incentive Unit awards were modified to allow for vesting subsequent to the termination of the employment for two employees (i.e. improbable-probable modification). The calculation of the incremental equity-based compensation expense was based on the new fair value of the award measured as of the date of modification. As a result of the modification and based on the performance condition being satisfied, the Company recognized an incremental equity-based compensation expense of $16.7 million for the year ended December 31, 2020. In connection with the divestiture of its Protein Detection business, the Company recognized incremental unit-based compensation expense of $2.4 million related to an amended agreement with an executive of Vector (see Note 2). This unit-based compensation expense was recorded within selling, general and administrative expenses in the consolidated statements of income for the year ended December 31, 2021. Unit-based compensation expense related to MLSH 1 Incentive Unit awards was approximately $0.7 million, $3.9 million and $22.3 million for the years ended December 31, 2022, 2021 and 2020, respectively. MLSH 1 Incentive Unit award activity during year ended December 31, 2022 is as follows: Number of Unvested MLSH 1 Incentive Units Weighted Average Grant Date Fair Value Per Unit Balance as of December 31, 2021 159 $ 22.20 Forfeited (6) 17.44 Vested (76) 20.39 Balance as of December 31, 2022 77 $ 24.34 As of December 31, 2022, total unrecognized compensation cost related to unvested MLSH 1 Incentive Units subject to service condition is $0.5 million which is expected to be recognized over a weighted average period of 1.6 years. Equity-Based Compensation The following table summarizes the total equity-based compensation expense included in the Company’s consolidated statements of income for the periods presented (in thousands): Year Ended December 31, 2022 2021 2020 Cost of sales $ 4,192 $ 1,915 $ 282 Selling, general and administrative 13,349 8,263 24,216 Research and development 1,129 280 131 Total equity-based compensation $ 18,670 $ 10,458 $ 24,629 |
Repurchase of Non-Controlling I
Repurchase of Non-Controlling Interests | 12 Months Ended |
Dec. 31, 2022 | |
Noncontrolling Interest [Abstract] | |
Repurchase of Non-Controlling Interests | Repurchase of Non-Controlling Interests In September 2020, Topco LLC and MLSH 1 entered into a Sale and Rollover Agreement with the President of Cygnus Technologies and his affiliated entity (collectively, the “Investors”) to purchase 43,264 MLSC Class B preferred units and 18,387,206 MLSC common units held by the Investors for approximately $120.0 million. In October 2020, Topco LLC repurchased $120.0 million of the MLSC Class B preferred and common units for cash. In addition, the Sale and Rollover Agreement provided that the remaining 16,736 MLSC Class B preferred units and 7,112,794 MLSC common units held by the Investors were exchanged upon the IPO into MLSH 1 common units for $46.6 million (the “Exchange”). In November 2020, and before the IPO, MLSH 1 exchanged its MLSH 1 common units for the remaining MLSC Class B preferred and common units and contributed the MLSC Class B preferred and common units to Topco LLC in a common control transaction. The difference between the consideration to be paid to the Investors associated with the non-controlling interests of $166.4 million and the carrying amount of the non-controlling interests in MLSC of $4.8 million was recorded, in the activity prior to the IPO and related Organizational Transactions, as a $161.6 million reduction in member’s equity in the consolidated statements of stockholders’/member’s equity. In November 2020, the MLSC LLC Agreement was amended and restated to recapitalize the outstanding equity into 1,000 common units. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes As of December 31, 2022 and 2021, we are subject to U.S. federal and state income taxes with respect to our allocable share of any taxable income or loss of Topco LLC, as well as any stand-alone income or loss we generate. Topco LLC is organized as a limited liability company and treated as a partnership for federal tax purposes and generally does not pay income taxes on its taxable income in most jurisdictions. Instead, Topco LLC’s taxable income or loss is passed through to its members, including us. Components of income from continuing operations before income taxes for the periods presented were as follows (in thousands): Year Ended December 31, 2022 2021 2020 U.S. $ 551,472 $ 530,853 $ 82,012 International — (88) (316) Total income from continuing operations $ 551,472 $ 530,765 $ 81,696 Income tax expense (benefit) consisted of the following for the periods presented (in thousands): Year Ended December 31, 2022 2021 2020 Current tax expense Federal $ 16,312 $ 9,291 $ 6,093 State and local 2,173 1,623 2,251 International 6 3,697 — Total current tax expense 18,491 14,611 8,344 Deferred tax expense (benefit) Federal $ 39,924 $ 36,564 $ (3,922) State and local 2,394 10,340 (1,542) Total deferred tax expense (benefit) 42,318 46,904 (5,464) Total provision for income taxes $ 60,809 $ 61,515 $ 2,880 A reconciliation between the Company’s effective tax rate and the applicable U.S. federal statutory income tax rate as of the periods presented is summarized as follows: December 31, 2022 December 31, 2021 December 31, 2020 Federal statutory rate 21.0 % 21.0 % 21.0 % State and local taxes, net of federal benefits 0.6 2.2 0.3 Deferred tax revaluation 0.3 — (1.8) Income of non-controlling interest (10.3) (11.4) (18.9) Taxable (loss) gain on subsidiary liquidation — (0.7) 2.7 Equity-based compensation — 0.1 1.3 Research and development credits (0.1) (0.4) (0.1) Valuation allowance 0.1 0.1 (1.5) Other (0.6) 0.7 0.5 Effective tax rate 11.0 % 11.6 % 3.5 % Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes and operating loss and tax credit carryforwards. Significant items comprising the net deferred tax assets were as follows as of the periods presented below (in thousands): December 31, 2022 December 31, 2021 Deferred tax assets Investment in Topco LLC $ 636,498 $ 675,855 Deductions to be received for the Tax Receivable Agreement payments 148,681 154,093 Capital loss carryforward 3,265 — Other 1,131 1,249 Total deferred tax assets 789,575 831,197 Valuation allowance (23,776) (23,080) Total deferred tax assets, net of valuation allowance $ 765,799 $ 808,117 As a result of the Organizational Transactions, IPO, and subsequent exchanges and financing, we acquired LLC Units and recognized a deferred tax asset for the difference between the financial reporting and tax basis of our investment in Topco LLC which included net deferred tax assets of $765.8 million primarily associated with: (i) $636.5 million related to temporary differences in the book basis as compared to the tax basis of our Company’s investment in Topco LLC and (ii) $148.7 million related to tax benefits from future deductions attributable to payments under the TRA, (iii) $3.3 million related to capital loss carryforwards generated during the sale of Vector, and (iv) $23.8 million valuation allowance on these items. The valuation allowance increased by $0.7 million and $9.4 million during the years ended December 31, 2022 and 2021, respectively. The realizability of the Company’s deferred tax asset related to its investment in Topco LLC depends on the Company receiving allocations of tax deductions for its tax basis in the investment and on the Company generating sufficient taxable income to fully offset such deductions. We believe it is more likely than not that the Company will generate sufficient taxable income in the future to fully realize any deductions allocated to it from Topco LLC associated with the reversal of its tax basis as of December 31, 2022. However, a portion of the deferred tax asset may only be realizable through the sale or liquidation of the investment and our ability to generate sufficient capital gains. Therefore, the change in the valuation allowance during December 31, 2022 is primarily due to an increase to reflect the deferred tax asset that is more likely than not to not be realized. Net operating loss (“NOL”) and tax credit carryforwards as of December 31, 2022 were as follows (in millions): Amount Expiration Years Capital loss carryforward $ 3.3 2026 Tax credits, state $ 0.1 CA - Do not expire As of December 31, 2022 and 2021, the Company had $6.3 million and $0.2 million of unrecognized tax benefits, all of which would affect the effective tax rate if recognized. The Company expects our unrecognized tax benefits may decrease by $1.9 million in the next twelve months due to statute expiration. The Company recognizes interest related to uncertain tax benefits as a component of income tax expense, including $1.0 million recognized during the year ended December 31, 2022. The aggregate changes in the balance of the Company’s unrecognized tax benefits were as follows for the periods presented (in thousands): Year Ended December 31, 2022 2021 2020 Balance, beginning of year $ 241 $ 220 $ 208 Gross increases based on tax positions related to current year 130 232 62 Gross increases based on tax positions related to prior years 6,775 — — Gross decreases based on tax positions related to prior years (889) (211) (50) Balance, end of year $ 6,257 $ 241 $ 220 The Company files income tax returns in the U.S. federal jurisdiction and various states. The Company received a notification on November 2, 2022 from the Internal Revenue Service (“IRS”) informing us of initiated administrative proceedings (audit) of Maravai Life Sciences Holdings, LLC’s 2020 tax year. We do not have any further information or communication from the taxing authorities with regards to their requests at this time. The Company is no longer subject to U.S. federal, state, and local, or non-U.S. income tax examinations for years before 2018. Payable to Related Parties Pursuant to the Tax Receivable Agreement We are a party to a TRA with MLSH 1 and MLSH 2. The TRA provides for the payment by us to MLSH 1 and MLSH 2, collectively, of 85% of the amount of certain tax benefits, if any, that we actually realize, or in some circumstances are deemed to realize, as a result of the Organizational Transactions, IPO and any subsequent purchases or exchanges of LLC Units of Topco LLC. Based on our current projections of taxable income, and before deduction of any specially allocated depreciation and amortization, we anticipate having enough taxable income to utilize most of these tax benefits. As of December 31, 2022, our liability under the TRA is $718.2 million, payable to MLSH 1 and MLSH 2, representing approximately 85% of the calculated tax savings we anticipate being able to utilize in future years. During the year ended December 31, 2022, the Company recognized a loss of $4.1 million on TRA liability adjustment primarily due to changes in our estimated state apportionment and the corresponding change of our estimated state tax rate. We made payments of $35.3 million to MLSH 1 and MLSH 2 pursuant to the TRA during the year ended December 31, 2022, of which $1.1 million is related to interest. We made payments of $1.3 million to MLSH 1 and MLSH 2 pursuant to the TRA during the year ended December 31, 2021. No payments were made during the year ended December 31, 2020. As of December 31, 2022 and 2021, our liabilities under the TRA were $718.2 million and $748.3 million, respectively. Tax Distributions to Topco LLC’s Owners Topco LLC is subject to an operating agreement put in place at the date of the Organizational Transactions (“LLC Operating Agreement”). The LLC Operating Agreement has numerous provisions related to allocations of income and loss, as well as timing and amounts of distributions to its owners. This agreement also includes a provision requiring cash distributions enabling its owners to pay their taxes on income passing through from Topco LLC. These tax distributions are computed based on an assumed income tax rate equal to the sum of (i) the maximum combined marginal federal and state income tax rate applicable to an individual and (ii) the net investment income tax. The assumed income tax rate ranges from 46.7% to 54.1% in certain cases where the qualified business income deduction is unavailable. In addition, under the tax rules, Topco LLC is required to allocate taxable income disproportionately to its unit holders. Because tax distributions are determined based on the holder of LLC Units who is allocated the largest amount of taxable income on a per unit basis, but are made pro rata based on ownership, Topco LLC is required to make tax distributions that, in the aggregate, will likely exceed the amount of taxes Topco LLC would have otherwise paid if it were taxed on its taxable income at the assumed income tax rate. Topco LLC is subject to entity level taxation in certain states and certain of its subsidiaries are subject to entity level U.S. and foreign income taxes. As a result, the accompanying consolidated statements of income include income tax expense related to those states and to U.S. and foreign jurisdictions where Topco LLC or any of our subsidiaries are subject to income tax. During the year ended December 31, 2022, Topco LLC paid tax distributions of $310.0 million to its owners, including $159.8 million to us. During the year ended December 31, 2021, Topco LLC paid tax distributions of $283.2 million to its owners, including $129.7 million to us. During the year ended December 31, 2020, Topco LLC paid tax distributions of $13.1 million to its owners, including $4.9 million to us. As of December 31, 2022, no amounts for tax distributions have been accrued as such payments were made during the period. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans The Company sponsors a 401(k) plan (the “Maravai LifeSciences 401(k) Plan”) pursuant to which eligible employees can elect to contribute to the 401(k) Plan, subject to certain limitations, on a pretax basis. The Company provides for a cash match of up to 50% of employee contributions up to the first 6% of salary. Total contributions by the Company to the Maravai LifeSciences 401(k) Plan was approximately $1.6 million, $1.3 million and $1.0 million for the years ended December 31, 2022, 2021 and 2020, respectively. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions MLSH 1’s majority owner is GTCR, LLC (“GTCR”). The Company’s Executive Chairman of the Board, Chief Financial Officer (“CFO”) and General Counsel are executives of MLSH 1 and MLSH 2. Advisory and Services Agreement with GTCR Prior to the IPO, GTCR provided subsidiaries of the Company with financial and management consulting services through an advisory services agreement. This advisory services agreement also provided that the Company pay placement fees to GTCR of 1.0% of the gross amount of any debt or equity financings as well as quarterly management fees. The advisory services agreement was terminated in connection with the IPO. The Company also reimburses GTCR for out-of-pocket expenses incurred while providing the above professional services. During the year ended December 31, 2020, the Company entered into the Credit Agreement (see Note 9) and paid GTCR a $3.7 million placement fee. For the year ended December 31, 2020, the Company incurred approximately $4.2 million in management fees to GTCR. All other amounts paid or payable under these agreements to GTCR were insignificant for all periods presented. Director Nomination Agreement with GTCR In connection with the IPO, the Company entered into a Director Nomination Agreement with GTCR. The Director Nomination Agreement provides GTCR the right to nominate to the Board a number of designees equal to at least: (i) 100% of the total number of directors comprising the Board, so long as GTCR beneficially owns shares of Class A common stock and Class B common stock representing at least 40% of the total amount of shares of Class A common stock and Class B common stock it owns, (ii) 40% of the total number of directors, in the event that GTCR beneficially owns shares of Class A common stock and Class B common stock representing at least 30% but less than 40% of the total amount of shares of Class A common stock and Class B common stock it owns, (iii) 30% of the total number of directors, in the event that GTCR beneficially owns shares of Class A common stock and Class B common stock representing at least 20% but less than 30% of the total amount of shares of Class A common stock and Class B common stock it owns, (iv) 20% of the total number of directors, in the event that GTCR beneficially owns shares of Class A common stock and Class B common stock representing at least 10% but less than 20% of the total amount of shares of Class A common stock and Class B common stock it owns and (v) one director, in the event that GTCR beneficially owns shares of Class A common stock and Class B common stock representing at least 5% of the total amount of shares of Class A common stock and Class B common stock it owns. In addition, GTCR is entitled to designate the replacement for any of its Board designees whose Board service terminates prior to the end of the director’s term, regardless of GTCR’s beneficial ownership at that time. GTCR also has the right to have its designees participate on committees of the Company’s Board proportionate to its voting power, subject to compliance with applicable law and stock exchange rules. The Director Nomination Agreement also prohibits the Company from increasing or decreasing the size of our Board without the prior written consent of GTCR. This agreement will terminate at such time as GTCR beneficially owns less than 5% of the shares of Class A and Class B common stock it beneficially owned at the date of the IPO. Registration Rights Agreement with MLSH 1 and MLSH 2 In connection with the IPO, Company entered into a registration rights agreement with MLSH 1 and MLSH 2. MLSH 1 and MLSH 2 are entitled to request that the Company register their shares of capital stock on a long-form or short-form registration statement on one or more occasions in the future, which registrations may be “shelf registrations.” MLSH 1 and MLSH 2 are also entitled to participate in certain of our registered offerings, subject to the restrictions in the registration rights agreement. During 2021, the Company registered shares of Class A shares held by MLSH 1 which were subsequently sold in an offering as selling shareholders as well as facilitated secondary offering transactions related to the exchanges (see Note 10). Exchange Agreement with MLSH 1 In connection with the IPO, the Company entered into an exchange agreement with MLSH 1, whereby MLSH 1 may surrender their LLC Units to Topco LLC or, at our election, exchange its LLC Units for shares of our Class A common stock on a one-for-one basis, or, at our election, for cash from a substantially concurrent public offering or private sale. MLSH 1 is also required to deliver to us an equivalent number of shares of Class B common stock to effectuate an exchange. MLSH 1 executed two exchanges under this agreement during 2021 (see Note 10). Payable to Related Parties Pursuant to the Tax Receivable Agreement Concurrent with the completion of the IPO, the Company entered into a TRA with MLSH 1 and MLSH 2. During the years ended December 31, 2022 and 2021, the Company made TRA payments to both MLSH 1 and MLSH 2 (see Note 14). Cash Contribution, Exchange and Forfeiture Agreement with MLSH 1 In December 2021, the Company entered into a Cash Contribution, Exchange and Forfeiture Agreement with MLSH 1 (see Note 10). Topco LLC Operating Agreement MLSH 1 is party to the Topco LLC operating agreement put in place at the date of the Organizational Transactions. This agreement includes a provision requiring cash distributions enabling its owners to pay their taxes on income passing through from Topco LLC. During the years ended December 31, 2022, 2021 and 2020, the Company made distributions of $150.2 million, $153.5 million and $8.2 million for tax liabilities to MLSH 1 under this agreement, respectively. Other Distributions In October 2020, the Company made an $88.6 million distribution to MLSH 1. Contract Development and Manufacturing Agreement with Curia Global GTCR has significant influence over Curia Global (“Curia”). During the year-ended December 31, 2022, the Company paid insignificant amounts to Curia for contract manufacturing and development services. During the year ended December 31, 2021, the Company paid $7.4 million to Curia. Such amounts were included in research and development expenses on the consolidated statements of income. Maravai LifeSciences Foundation In December 2021, the Company established a new charitable foundation to promote causes tied to Maravai’s mission. During the year ended December 31, 2021, the Company contributed $2.0 million to the Foundation. The Company does not control the Foundation’s activities, and accordingly, does not consolidate the Foundation. |
Segments
Segments | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segments | Segments Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. When determining the reportable segments, the Company aggregated operating segments based on their similar economic and operating characteristics. Segment results are presented in the same manner as we present our operations internally to make operating decisions and assess performance. The accounting policies for the segments are the same as those described in Significant Accounting Policies (see Note 1). The Company’s financial performance is reported in three segments. A description of each segment follows: • Nucleic Acid Production : focuses on the manufacturing and sale of highly modified nucleic acids products to support the needs of customers’ research, therapeutic and vaccine programs. This segment also provides research products for labeling and detecting proteins in cells and tissue samples. • Biologics Safety Testing : focuses on manufacturing and selling biologics safety and impurity tests and assay development services that are utilized by our customers in their biologic drug manufacturing spectrum. • Protein Detection : focused on manufacturing and selling labeling and visual detection reagents to scientific research customers for their tissue-based protein detection and characterization needs. The Company completed the divestiture of its Protein Detection business in September 2021 (see Note 2). The Company has determined that adjusted earnings before interest, tax, depreciation and amortization (“Adjusted EBITDA”) is the profit or loss measure that the CODM uses to make resource allocation decisions and evaluate segment performance. Adjusted EBITDA assists management in comparing the segment performance on a consistent basis for purposes of business decision-making by removing the impact of certain items that management believes do not directly reflect the core operations and, therefore, are not included in measuring segment performance. The Company defines Adjusted EBITDA as net income before interest, taxes, depreciation and amortization, certain non-cash items and other adjustments that we do not consider in our evaluation of ongoing operating performance from period to period. Corporate costs, net of eliminations, are managed on a standalone basis and not allocated to segments. The following schedule includes revenue and adjusted EBITDA for each of the Company’s reportable operating segments (in thousands). We have revised our presentation for the prior periods below to remove the presentation of Total Adjusted EBITDA and reconcile the total of our reportable segments’ measure of profit or loss to income before income taxes in addition to net income, and removed corporate costs, net of eliminations from total reportable segments’ adjusted EBITDA and included such amounts in the reconciliation to income before income taxes. Additionally, we have revised our prior years’ presentation of our total reportable segments’ revenue, in which we removed intersegment eliminations from our total reportable segment’s revenue. Year Ended December 31, 2022 2021 2020 Revenue: Nucleic Acid Production $ 813,076 $ 712,520 $ 207,597 Biologics Safety Testing 69,932 68,417 54,897 Protein Detection — 18,959 22,881 Total reportable segments’ revenue 883,008 799,896 285,375 Intersegment eliminations (7) (656) (1,277) Total $ 883,001 $ 799,240 $ 284,098 Segment adjusted EBITDA: Nucleic Acid Production $ 638,337 $ 565,254 $ 133,822 Biologics Safety Testing 54,841 54,440 44,516 Protein Detection — 6,391 9,225 Total reportable segments’ adjusted EBITDA 693,178 626,085 187,563 Reconciliation of total reportable segments’ adjusted EBITDA to income before income taxes Amortization (24,269) (18,339) (20,320) Depreciation (7,566) (6,413) (5,593) Interest expense (20,414) (30,260) (30,740) Interest income 2,338 — — Corporate costs, net of eliminations (55,378) (43,265) (18,398) Other adjustments: Acquisition contingent consideration 7,800 — — Acquisition integration costs (13,362) (44) (3,857) Acquired in-process research and development costs — — (2,881) Equity-based compensation (18,670) (10,458) (24,629) GTCR management fees — — (680) Gain on sale of business — 11,249 — Gain on sale and leaseback transaction — — 19,002 Merger and acquisition related expenses (2,416) (1,508) (395) Financing costs (1,078) (2,383) (9,784) Acquisition related tax adjustment (349) — — Tax Receivable Agreement liability adjustment (4,102) 6,101 — Chief Executive Officer transition costs (2,426) — — Other (1,814) — (7,592) Income before income taxes 551,472 530,765 81,696 Income tax expense (60,809) (61,515) (2,880) Net income $ 490,663 $ 469,250 $ 78,816 During the year ended December 31, 2022, intersegment revenue was immaterial between the Nucleic Acid Production and Biologics Safety Testing segments. During the years ended December 31, 2021 and 2020, intersegment revenue was $0.7 million and $1.3 million, respectively, between the Nucleic Acid Production and Protein Detection segments. The intersegment sales and the related gross margin on inventory recorded at the end of the period are eliminated for consolidation purposes. Internal selling prices for intersegment sales are consistent with the segment’s normal retail price offered to external parties. There was no commission expense recognized for intersegment sales for the years ended December 31, 2022, 2021 and 2020. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventIn January 2023, we completed the acquisition of Alphazyme, LLC (“Alphazyme”), a privately-held original equipment manufacturer (“OEM”) provider of custom, scalable, molecular biology enzymes to customers in the genetic analysis and nucleic acid synthesis markets. The total consideration to acquire Alphazyme consisted of a base cash purchase price of $70.0 million, subject to customary post-closing adjustments, and potential performance payments payable in cash of up to $75.0 million. |
Organization and Significant _2
Organization and Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The Company operates and controls all of the business and affairs of Topco LLC, and, through Topco LLC and its subsidiaries, conducts its business. Because we manage and operate the business and control the strategic decisions and day-to-day operations of Topco LLC and also have a substantial financial interest in Topco LLC, we consolidate the financial results of Topco LLC, and a portion of our net income is allocated to the non-controlling interests in Topco LLC held by MLSH 1. The Organizational Transactions were considered transactions between entities under common control. As a result, the consolidated financial statements for periods prior to the IPO have been adjusted to combine the previously separate entities for presentation purposes. The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and include our accounts and the accounts of our subsidiaries. All intercompany transactions and accounts between the businesses comprising the Company have been eliminated in the accompanying consolidated financial statements. |
Variable Interest Entity | Variable Interest Entities The Company consolidates all entities that it controls through a majority voting interest or as the primary beneficiary of a variable interest entity (“VIE”). In determining whether the Company is the primary beneficiary of an entity, the Company applies a qualitative approach that determines whether it has both (i) the power to direct the economically significant activities |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in accordance with GAAP requires the Company to make judgements, estimates and assumptions that affect the reported amounts of assets, liabilities, equity, revenue and expenses, and related disclosures. These estimates form the basis for judgments the Company makes about the carrying values of assets and liabilities that are not readily apparent from other sources. The Company bases its estimates and judgments on historical experience and on various other assumptions that the Company believes are reasonable under the circumstances. These estimates are based on management’s knowledge about current events and expectations about actions the Company may undertake in the future. Significant estimates include, but are not limited to, the measurement of right-of-use assets and lease liabilities and related incremental borrowing rate, the payable to related parties pursuant to the Tax Receivable Agreement (as defined in Note 14), the realizability of our net deferred tax assets, and valuation of goodwill and intangible assets acquired in business combinations. Actual results could differ materially from those estimates. |
Revenue Recognition and Shipping and Handling Costs | Revenue Recognition The Company generates revenue primarily from the sale of products, and to a much lesser extent, services in the fields of nucleic acid production, biologics safety testing, and protein detection. Revenue is recognized when control of promised goods or services is transferred to a customer in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To determine revenue recognition for its arrangements with customers, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The majority of the Company’s contracts include only one performance obligation. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is defined as the unit of account for revenue recognition. The Company also recognizes revenue from other contracts that may include a combination of products and services, the provision of solely services, or from license fee arrangements which may be associated with the delivery of product. Where there is a combination of products and services, the Company accounts for the promises as individual performance obligations if they are concluded to be distinct. Performance obligations are considered distinct if they are both capable of being distinct and distinct within the context of the contract. In determining whether performance obligations meet the criteria for being distinct, the Company considers a number of factors, such as the degree of interrelation and interdependence between obligations, and whether or not the good or service significantly modifies or transforms another good or service in the contract. As a practical expedient, we do not adjust the transaction price for the effects of a significant financing component if, at contract inception, the period between customer payment and the transfer of goods or services is expected to be one year or less. Contracts with customers are evaluated on a contract-by-contract basis as contracts may include multiple types of goods and services as described below. Nucleic Acid Production Nucleic Acid Production revenue is generated from the manufacture and sale of highly modified, complex nucleic acids products to support the needs of our of customers’ research, therapeutic and vaccine programs. The primary offering of products includes CleanCap, mRNA, and specialized oligonucleotides. Contracts typically consist of a single performance obligation. We also sell nucleic acid products for labeling and detecting proteins in cells and tissue samples research. The Company recognizes revenue from these products in the period in which the performance obligation is satisfied by transferring control to the customer. Revenue for nucleic acid catalog products is recognized at a single point in time, generally upon shipment to the customer. Revenue for contracts for certain custom nucleic acid products, with an enforceable right to payment and a reasonable margin for work performed to date, is recognized over time, based on a cost-to-cost input method over the manufacturing period. Payments received from customers in advance of manufacturing their products is recorded as deferred revenue until the products were delivered. Biologics Safety Testing The Company’s Biologics Safety Testing revenue is associated with the sale of bioprocess impurity detection kit products. We also enter into contracts that include custom antibody development, assay development and antibody affinity extraction services. These products and services enable the detection of impurities that occur in the manufacturing of biologic drugs and other therapeutics. The Company recognizes revenue from the sale of bioprocess impurity detection kits in the period in which the performance obligation is satisfied by transferring control to the customer. Custom antibody development contracts consist of a single performance obligation, typically with an enforceable right to payment and a reasonable margin for work performed to date. Revenue is recognized over time based on a cost-to-cost input method over the contract term. Where an enforceable right to payment does not exist, revenue is recognized at a point in time when control is transferred to the customer. Assay development service contracts consist of a single performance obligation, revenue is recognized at a point in time when a successful antigen test and report is provided to the customer. Affinity extraction services, which generally occur over a short period of time, consist of a single performance obligation to perform the extraction service and provide a summary report to the customer. Revenue is recognized either over time or at a point in time depending on contractual payment terms with the customer. The Company elected the practical expedient to not disclose the unfulfilled performance obligations for contracts with an original length of one year or less. The Company had no material unfulfilled performance obligations for contracts with an original length greater than one year for any period presented. The Company accepts returns only if the products do not meet customer specifications and historically, the Company’s volume of product returns has not been significant. Further, no warranties are provided for promised goods and services other than assurance type warranties. Revenue for an individual contract is recognized at the related transaction price, which is the amount the Company expects to be entitled to in exchange for transferring the products and/or services. The transaction price for product sales is calculated at the contracted product selling price. The transaction price for a contract with multiple performance obligations is allocated to the separate performance obligations on a relative standalone selling price basis. Standalone selling prices for products are determined based on the prices charged to customers, which are directly observable. Standalone selling price of services are mostly based on time and materials. Generally, payments from customers are due when goods and services are transferred. As most contracts contain a single performance obligation, the transaction price is representative of the standalone selling price charged to customers. Revenue is recognized only to the extent that it is probable that a significant reversal of the cumulative amount recognized will not occur in future periods. Variable consideration has not been material to our consolidated financial statements. Sales taxes Sales taxes collected by the Company are not included in the transaction price as revenue as they are ultimately remitted to a governmental authority. Shipping and handling costs The Company has elected to account for shipping and handling activities related to contracts with customers as costs to fulfill the promise to transfer the associated products. Accordingly, revenue for shipping and handling is recognized at the same time that the related product revenue is recognized. Contract costs The Company recognizes the incremental costs of obtaining contracts as an expense when incurred when the amortization period of the assets that otherwise would have been recognized is one year or less. These costs are included in sales and marketing and general and administrative expenses. The costs to fulfill the contracts are determined to be immaterial and are recognized as an expense when incurred. Contract balances Contract assets are generated when contractual billing schedules differ from revenue recognition timing and the Company records contract receivable when it has an unconditional right to consideration. There were no contract asset balances as of December 31, 2022 or 2021. |
Research and Development | Research and Development Research and development (“R&D”) expenses include personnel costs, including salaries, benefits and equity-based compensation for laboratory personnel, outside contracted services, and costs of supplies. R&D costs are expensed as incurred. Payments made prior to the receipt of goods or services to be used in R&D are recognized as prepaid assets until the goods are received or services are rendered. |
Advertising Costs | Advertising CostsThe Company expenses advertising costs as incurred. |
Equity-Based Compensation | Equity-Based Compensation Stock-Based Compensation The Company recognized stock-based compensation for all equity awards made to employees based upon the awards’ estimated grant date fair value. For equity awards that vest subject to the satisfaction of service requirements, compensation expense is measured based on the fair value of the award on the date of grant and expense is recognized on a straight-line basis over the requisite service period, which is typically between two The Company estimates the fair value of stock option grants using the Black-Scholes option pricing model. The assumptions used in estimating the fair value of these awards, such as expected term, expected dividend yield, volatility and risk-free interest rate, represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. If actual results are not consistent with the Company’s assumptions and judgments used in making these estimates, the Company may be required to increase or decrease compensation expense, which could be material to the Company’s consolidated results of operations. The fair value of restricted stock units (“RSUs”) is determined based on the number of shares granted and the quoted market price of the Company’s Class A common stock on the date of grant. For performance stock units (“PSUs”) which are subject to service and market conditions, compensation expense is measured based on the fair value of the award on the date of grant and expense is recognized on a straight-line basis over the requisite service period regardless if the market condition is satisfied. If the grantee is terminated prior to meeting both conditions, any previously recognized expense is reversed. The Company estimates the fair value of PSUs using the Monte Carlo simulation model. The assumptions used in estimating the fair value of these awards, such as expected term, volatility and risk-free interest rate, represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. Unit-Based Compensation Up until the IPO, MLSH 1 had granted unit-based awards to certain executives of Topco LLC who are also executives of the Company in the form of non-vested units. Topco LLC’s controlled subsidiary, MLSC, also granted unit-based awards only to certain employees of its subsidiaries (collectively, the “Incentive Units”). All awards of Incentive Units were measured based on the fair value of the award on the date of grant. The Company recognizes compensation expense for MLSH 1 awards in its consolidated financial statements as MLSH 1 is considered to be the economic interest holder in Topco LLC. Compensation expense for the Incentive Units is recognized over their requisite service period. Forfeitures are recognized when they occur. The grant date fair value of Incentive Unit awards was determined by the Company’s Board of Directors with the assistance of management and an independent third-party valuation specialist. |
Income Taxes | Income Taxes We are subject to U.S. federal and state income taxes. We are the controlling member of Topco LLC, which has been, and will continue to be, treated as a partnership for U.S. federal and state income tax purposes. Topco LLC’s previously wholly-owned U.S. subsidiary, Maravai Life Sciences, Inc. (“Maravai Inc.”) and its subsidiaries, were taxpaying entities in the U.S., Canada, and the U.K. Maravai Inc.’s subsidiaries were sold and Maravai Inc. ceased to be a regarded entity and was deemed liquidated for U.S. tax purposes during the year ended December 31, 2021. Topco LLC’s other subsidiaries are treated as pass-through entities for federal and state income tax purposes. The income or loss generated by these entities is not taxed at the LLC level. As required by U.S. tax law, income or loss generated by these LLCs passes through to their owners. As such, our tax provision consists solely of the activities of Maravai Inc. and its subsidiaries, prior to their disposal, as well as our share of income generated by Topco LLC. We account for income taxes under the asset and liability method of accounting. Current income tax expense or benefit represents the amount of income taxes expected to be payable or refundable for the current year. We recognize deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as for operating loss and tax credit carryforwards. We measure deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which we expect to recover or settle those temporary differences. We recognize the effect of a change in tax rates on deferred tax assets and liabilities in the results of operations in the period that includes the enactment date. We reduce the measurement of a deferred tax asset, if necessary, by a valuation allowance if it is more likely than not that we will not realize some or all of the deferred tax asset. |
Payables to Related Parties Pursuant to the Tax Receivable Agreement | We accrue a liability for the payable to related parties for the TRA and a reduction to stockholders’ equity, when it is deemed probable that the Tax Attributes will be used to reduce our taxable income, as the contractual percentage of the benefit of Tax Attributes that we expected to receive over a period of time. The current portion, if any, of the liability is the amount estimated to be paid within one year of the consolidated balance sheet date. For purposes of estimating the value of the payable to related parties for the TRA, the tax benefit deemed realized by us and payable to MLSH 1 and MLSH 2 is computed by taking 85% of the difference of between our undiscounted forecasted cash income tax liability over the term of benefit of the Tax Attributes and the forecasted amount of such taxes that we would have been required to pay had there been no Tax Attributes. The TRA applies to each of our taxable years, beginning with the taxable year that the TRA is entered into. There is no maximum term for the TRA and the TRA will continue until all such tax benefits have been utilized or expired unless we exercise our right to terminate the TRA for an agreed-upon amount equal to the estimated present value of the remaining payments to be made under the agreement. We may record additional liabilities under the TRA when LLC Units of Topco LLC are exchanged in the future and as our estimates of the future utilization of the tax benefits change. If, due to a change in facts, these tax attributes are not utilized in future years, it is reasonably possible no amounts would be paid under the TRA. In this scenario, the reduction of the liability under the TRA would result in a benefit to our consolidated statements of income. Subsequent adjustments to the payable to related parties for the TRA based on changes in anticipated future taxable income are recorded in our consolidated statements of income. |
Non-Controlling Interests | Non-Controlling Interests Non-controlling interests re present the portion of profit or loss, net assets and comprehensive income of our consolidated subsidiaries that is not allocable to the Company based on our percentage of ownership of such entities. Non-controlling interests consist of the following: • Until November, 2020 Topco LLC held a 70% ownership interest in MLSC Holdings, LLC (“MLSC”) through its consolidated subsidiaries with the remaining 30% being recorded as non-controlling interests in our consolidated financial statements . MLSC net income or loss was attributed to the non-controlling interests using an attribution method, similar to the hypothetical liquidation at book value method, based on the distribution provisions of the MLSC Amended and Restated Limited Liability Company Agreement (“MLSC LLC Agreement”). In November 2020, and before the closing of the IPO, Topco LLC repurchased all of the outstanding non-controlling interests in MLSC for $166.4 million (see Note 13) . • In November 2020, following the completion of the Organizational Transactions, we became the sole managing member of Topco LLC. As of December 31, 2022 , we held approximately 51.6% of the outstanding LLC Units of Topco LLC, and MLSH 1 held approximately 48.4% of the outstanding LLC Units of Topco LLC. Therefore, we report non-controlling interests based on the percentage of LLC Units of Topco LLC held by MLSH 1 on our consolidated balance sheet as of December 31, 2022. Income or loss attributed to the non-controlling interest in Topco LLC is based on the LLC Units outstanding during the period for which the income or loss is generated and is presented on the consolidated statements of income and consolidated statements of comprehensive income. MLSH 1 is entitled to exchange LLC Units, together with an equal number of shares of our Class B common stock (together referred to as “Paired Interests”), for shares of Class A common stock on a one-for-one basis or, at our election, for cash, from a substantially concurrent public offering or private sale (based on the price of our Class A common stock in such public offering or private sale). As such, future exchanges of Paired Interests by MLSH 1 will result in a change in ownership and reduce or increase the amount recorded as non-controlling interests and increase or decrease additional paid-in-capital when Topco LLC has positive or negative net assets, respectively. |
Segment Information | Segment Information The Company has historically operated in three reportable segments. Operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the Company’s chief operating decision maker (“CODM”) in deciding how to allocate resources and assessing performance. The CODM allocates resources and assesses performance based upon discrete financial information at the segment level. All of our long-lived assets are located in the United States. After the divestiture of Vector in September 2021, the Company no longer has the Protein Detection segment. The Company has reported the historical results of the Protein Detection business as such discrete financial information evaluated by the CODM for the periods presented included the information for this legacy segment. As of December 31, 2022, the Company operated in two reportable segments: Nucleic Acid Production and Biologics Safety Testing. |
Cash | Cash Cash consists of deposits held at financial institutions. |
Accounts Receivable and Allowance for Credit Losses | Accounts Receivable and Allowance for Credit Losses Accounts receivable primarily consist of amounts due from customers for product sales and services. The Company’s expected credit losses are developed using an estimated loss rate method that considers historical collection experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The estimated loss rates are applied to trade receivables with similar risk characteristics such as the length of time the balance has been outstanding, liquidity and financial position of the customer, and the geographic location of the customer. In certain instances, the Company may identify individual accounts receivable assets that do not share risk characteristics with other accounts receivable, in which case the Company records its expected credit losses on an individual asset basis. As of December 31, 2022 and 2021, the allowance for credit losses was approximately $2.2 million and $0.3 million, respectively. Write-offs of accounts receivable and recoveries were not significant during the years ended December 31, 2022 or 2021. |
Inventory | Inventory Inventories consist of raw materials, work in process and finished goods. Inventories are stated at the lower of cost (weighted average cost) or net realizable value. Inventory costs, which relate to the purchase or production of inventories, include materials, direct labor and manufacturing overhead. The Company regularly monitors for excess and obsolete inventory based on its estimates of expected sales volumes, production capacity and expiration of raw materials, work-in-process and finished products, and reduces the carrying value of inventory accordingly. The Company writes down inventory that has become obsolete, inventory that has a cost basis in excess of its expected net realizable value, and inventory in excess of expected manufacturing requirements. Any write-downs of inventories are charged to cost of revenue. A change in the estimated timing or amount of demand for the Company’s products could result in reduction to the recorded value of inventory quantities on hand. Any significant unanticipated changes in demand or unexpected quality failures could have a significant impact on the value of inventory and reported operating results. During all periods presented in the accompanying consolidated financial statements, there have been no material adjustments related to a revised estimate of our inventory valuations. |
Government Assistance | Government Assistance The consideration awarded to the Company by the U.S. Department of Defense is outside the scope of the contracts with customers, income tax, funded research and development, and contribution guidance. This is because the awarding entity is not considered to be a customer, the receipt of the funding is not predicated on the Company’s income tax position, there are no refund provisions, and the entity is not receiving reciprocal value for their support provided to the Company. The Company’s elected policy is to recognize such assistance as a reduction to the carrying amount of the assets associated with the award when |
Property and Equipment | Property and EquipmentProperty and equipment are stated at cost, less accumulated depreciation. Leasehold improvements are amortized over the shorter of the related lease term or useful life. Maintenance and repairs are charged to operations when incurred, while betterments or renewals are capitalized. When property and equipment are sold or otherwise disposed of, the asset account and related accumulated depreciation account are relieved, and any gain or loss is included in the results of operations. The Company records certain government grants earned related to capital projects as a reduction to property and equipment. |
Goodwill | GoodwillGoodwill represents the excess of consideration transferred over the estimated fair value of assets acquired and liabilities assumed in a business combination. The Company conducts a goodwill impairment analysis at least annually and more frequently if changes in facts and circumstances indicate that the fair value of the Company’s reporting units may be less than carrying amount. In performing each annual impairment assessment and any interim impairment assessment, the Company determines if it should qualitatively assess whether it is more likely than not that the fair value of goodwill is less than its carrying amount (the qualitative impairment test). If it is more likely than not that the fair value of the reporting unit is less than its carrying amount, or if the Company elects not to perform the qualitative impairment test, the Company then performs a quantitative impairment test. The Company’s annual or interim quantitative impairment testing is performed by comparing the estimated fair value of the reporting unit to its carrying value. An impairment charge is recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value, not to exceed the carrying value of goodwill. |
Intangible Assets | Intangible Assets The Company’s finite-lived intangible assets represent purchased intangible assets and primarily consist of trade names, customer relationships, patents, and developed technology. Certain criteria are used in determining whether intangible assets acquired in a business combination must be recognized and reported separately. Finite-lived intangible assets are initially recognized at fair value, are subject to amortization and are subsequently stated at amortized cost. The Company’s finite-lived intangible assets are amortized using a method that reflects the pattern in which the economic benefits of the intangible assets are consumed or otherwise used. If that pattern cannot be reliably determined, the intangible assets are amortized using the straight-line method over their estimated useful lives and are tested for impairment along with other long-lived assets. Amortization related to patents and developed technology is allocated to cost of revenue whereas amortization associated with trade names and customer relationships is allocated to selling, general and administrative expenses. |
Impairment of Long-Lived and Intangible Assets | Impairment of Long-Lived and Intangible Assets The Company periodically reviews long-lived assets, including property and equipment, right-of-use operating lease assets and finite-lived intangible assets, to determine whether current events or circumstances indicate that such carrying amounts may not be recoverable. If such facts or circumstances are determined to exist, an estimate of the undiscounted future cash flows of these assets is compared to the carrying value of the assets to determine whether impairment exists. If the assets are determined to be impaired, the loss is measured based on the difference between the fair value and carrying value of the assets. If we determine that events and circumstances warrant a revision to the remaining period of amortization or depreciation for a specific long-lived asset, its remaining estimated useful life will be revised, and the remaining carrying amount of the long-lived asset will be depreciated or amortized prospectively over the revised remaining estimated useful life. No impairment loss was recognized for long-lived assets for any period presented. |
Contingent Consideration and Acquisitions | Contingent Consideration Contingent consideration represents additional consideration that may be transferred to former owners of an acquired entity in the future if certain future events occur or conditions are met. Contingent consideration resulting from the acquisition of a business is recorded at fair value on the acquisition date. Such contingent consideration is re-measured to its estimated fair value at each reporting date with the change in fair value recognized within operating expenses in the Company’s consolidated statements of income. Subsequent changes in the fair value of the contingent consideration are classified as an adjustment to cash flows from operating activities in the consolidated statements of cash flows because the change in fair value is an input in determining net income. Cash paid in settlement of contingent consideration liabilities are classified as cash flows from financing activities up to the acquisition date fair value with any excess classified as cash flows from operating activities. Changes in the fair value of contingent consideration liabilities associated with the acquisition of a business can result from updates to assumptions such as the expected timing or probability of achieving customer-related performance targets, specified sales milestones, changes in projected revenue or changes in discount rates. Judgment is used in determining those assumptions as of the acquisition date and for each subsequent reporting period. Therefore, any changes in the fair value will impact the Company’s results of operations in such reporting period, thereby resulting in potential variability in the Company’s operating results until such contingencies are resolved. Acquisitions The Company evaluates mergers, acquisitions and other similar transactions to assess whether or not the transaction should be accounted for as a business combination or an acquisition of assets. The Company first identifies the acquiring entity by determining if the target is a legal entity or a group of assets or liabilities. If control over a legal entity is being evaluated, the Company also evaluates if the target is a variable interest or voting interest entity. For acquisitions of voting interest entities, the Company applies a screen test to determine if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. If the screen test is met, the transaction is accounted for as an acquisition of assets. If the screen is not met, further determination is required as to whether or not the Company has acquired inputs and processes that have the ability to create outputs which would meet the definition of a business. The Company accounts for its business combinations using the acquisition method of accounting which requires that the assets acquired and liabilities assumed of acquired businesses be recorded at their respective fair values at the date of acquisition. The purchase price, which includes the fair value of consideration transferred, is attributed to the fair value of the assets acquired and liabilities assumed. The purchase price may also include contingent consideration. The Company assesses whether such contingent consideration is subject to liability classification and fair value measurement or meets the definition of a derivative. Contingent consideration liabilities are recognized at their estimated fair value on the acquisition date. Contingent consideration arrangements that are determined to be compensatory in nature are recognized as post combination expense in our consolidated statements of income ratably over the implied service period beginning in the period it becomes probable such amounts will become payable. The excess of the purchase price of the acquisition over the fair value of the identifiable net assets of the acquiree is recorded as goodwill. The fair value of assets acquired and liabilities assumed in certain cases may be subject to revision based on the final determination of fair value during a period of time not to exceed twelve months from the acquisition date. The results of acquired businesses are included in the Company’s consolidated financial statements from the date of acquisition. Transaction costs directly attributable to acquired businesses are expensed as incurred. Determining the fair value of assets acquired and liabilities assumed requires management to use significant judgment and estimates, including the selection of valuation methodologies and assumptions about future net cash flows, discount rates and market participants. Each of these factors can significantly affect the value attributed to the identifiable intangible asset acquired in a business combination. |
Debt Issuance Costs | Debt Issuance Costs Costs incurred in connection with obtaining new debt financing are deferred and amortized over the life of the related financing. If such financing is settled or replaced prior to maturity with debt instruments that have substantially different terms, the settlement is treated as an extinguishment and the unamortized costs are charged to gain or loss on extinguishment of debt. If such financing is settled or replaced with debt instruments from the same lender that do not have substantially different terms, the new debt agreement is accounted for as a modification for the prior debt agreement and the unamortized costs remain capitalized, the new original issuance discount costs are capitalized, and any new third-party costs are charged to expense. Deferred costs are recognized as a direct reduction in the carrying amount of the debt instrument on the consolidated balance sheets and are amortized to interest expense over the term of the related debt using the effective interest method. |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) Comprehensive income (loss) and its components encompass all changes in equity other than those with stockholders or member. Comprehensive income (loss) for the Company consists of foreign currency translation adjustments. There were no reclassifications out of accumulated other comprehensive loss during the periods presented. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company defines fair value as the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. The Company follows accounting guidance that has a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of the asset or liability as of the measurement date. Instruments with readily available actively quoted prices, or for which fair value can be measured from actively quoted prices in an orderly market, will generally have a higher degree of market price transparency and a lesser degree of judgment used in measuring fair value. The three levels of the hierarchy are defined as follows: Level 1—Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets; Level 2—Include other inputs that are directly or indirectly observable in the marketplace; and Level 3—Unobservable inputs which are supported by little or no market activity. As of December 31, 2022 and 2021, the carrying value of current assets and liabilities approximates fair value due to the short maturities of these instruments. The fair values of the Company’s long-term debt approximate carrying value, excluding the effect of unamortized debt discount, as it is based on borrowing rates currently available to the Company for debt with similar terms and maturities (Level 2 inputs). |
Leases | Leases The Company determines whether the arrangement is or contains a lease based on the unique facts and circumstances present at the inception of the arrangement and if such a lease is classified as a financing lease or operating lease. Leases with a term greater than one year are included in other assets, accrued expenses and other current liabilities, and other long-term liabilities on our balance sheet as of December 31, 2022 and 2021. The Company has elected not to recognize on the balance sheet leases with terms of one year or less. Right-of-use (“ROU”) assets represents the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease contract. Lease liabilities and their corresponding ROU assets are recorded based on the present value of lease payments over the expected lease term. In determining the net present value of lease payments, the interest rate implicit in lease contracts is typically not readily determinable. As such, the Company utilizes the appropriate incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. Certain adjustments to the ROU asset may be required for items such as initial direct costs paid or incentives received and impairment charges if we determine the ROU asset is impaired. The Company considers a lease term to be the noncancelable period that it has the right to use the underlying asset, including any periods where it is reasonably assured the Company will exercise the option to extend the contract. Periods covered by an option to extend are included in the lease term if the lessor controls the exercise of that option. The Company recognizes lease expense on a straight-line basis over the expected lease term. Variable lease payments, for items such as maintenance and utilities, are not included in the calculation of the ROU asset and the related lease liability and are recognized as this lease expense is incurred. The Company has elected to not separate lease and non-lease components for its leased assets and accounts for all lease and non-lease components of its agreements as a single lease component. The lease components resulting in a ROU asset have been recorded on the balance sheet and amortized as lease expense on a straight-line basis over the lease term. |
Concentration of Credit Risk | Concentration of Credit RiskFinancial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and accounts receivable. The Company maintains the majority of its cash balances at multiple financial institutions that management believes are of high-credit quality and financially stable. Cash is deposited with major financial institutions in excess of Federal Deposit Insurance Corporation (“FDIC”) insurance limits. The Company believes it is not exposed to significant credit risk due to the financial strength of the depository institutions in which the cash is held. The Company provides credit, in the normal course of business, to international and domestic distributors as well as certain customers, which are geographically dispersed. The Company attempts to limit its credit risk by performing ongoing credit evaluations of its customers and maintaining adequate allowances for potential credit losses. |
Net Income per Class A Common Share/Unit Attributable to Maravai LifeSciences Holdings, Inc. | Net Income per Class A Common Share/Unit Attributable to Maravai LifeSciences Holdings, Inc.Basic net income per Class A common share/unit attributable to Maravai LifeSciences Holdings, Inc. is computed by dividing net income attributable to us by the weighted average number of Class A common shares/units outstanding during the period. The non-controlling interest, for historical periods prior to the IPO, is calculated pursuant to the terms of the MLSC LLC Agreement on a fully-distributed basis, taking into account the various classes of equity of MLSC, including the cumulative yields on MLSC’s preferred units. Diluted net income per Class A common share/unit is calculated by giving effect to all potential weighted average dilutive LLC incentive units for historical periods prior to the IPO and stock options, restricted stock units, performance stock units and Topco LLC Units, that together with an equal number of shares of our Class B common stock (together referred to as “Paired Interests”) are convertible into shares of our Class A common stock, for the period after the IPO. For historical periods prior to the IPO, the weighted average number of common units outstanding during the period and the potential dilutive common unit equivalents is determined under the two-class method. The dilutive effect of outstanding awards, if any, is reflected in diluted earnings per share/unit by application of the treasury stock method or if-converted method, as applicable. In periods in which the Company reports a net loss attributable to Maravai LifeSciences Holdings, Inc. diluted net loss per Class A common share/unit attributable to the Company since dilutive equity instruments are not assumed to have been issued if their effect is anti-dilutive. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2021-08, Business Combinations (Topic 805) - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”), which requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities in accordance with ASC 606, Revenue from Contracts with Customers, as if it had originated the contracts. This approach differs from the current requirement to measure contract assets and contract liabilities acquired in a business combination at fair value. ASU 2021-08 is effective for years beginning after December 31, 2022, including interim periods within those fiscal years, with early adoption permitted. The ASU is to be applied prospectively to business combinations occurring on or after the effective date of its adoption. The Company early adopted ASU 2021-08, and there was no impact to the Company’s consolidated financial statements as a result of the adoption of this ASU. In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832) - Disclosures by Business Entities about Government Assistance (“ASU 2021-10”). ASU 2021-10 provides guidance to increase the transparency of government assistance including the disclosure of: (i) the types of assistance, (ii) an entity’s accounting for the assistance, and (iii) the effect of the assistance on an entity’s financial statements. Under the new guidance, an entity is required to provide the following annual disclosures about transactions with a government that are accounted for by applying a grant or contribution accounting model by analogy: (i) information about the nature of the transactions and the related accounting policy used to account for the transactions, (ii) the line items on the balance sheet and income statement that are affected by the transactions, and the amounts applicable to each financial statement line item, and (iii) significant terms and conditions of the transactions, including commitments and contingencies. The new guidance is required to be adopted either: (i) prospectively to all transactions within the scope of the amendments that are reflected in financial statements at the date of initial application and new transactions that are entered into after the date of initial application, or (ii) retrospectively to those transactions. The Company adopted ASU |
Organization and Significant _3
Organization and Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Revenue by Geographic Areas and Segment | The following tables summarize the revenue by segment and region for the periods presented (in thousands): Year Ended December 31, 2022 Nucleic Acid Production Biologics Safety Testing Total North America $ 312,119 $ 27,354 $ 339,473 Europe, the Middle East and Africa 415,298 17,628 432,926 Asia Pacific 85,508 24,286 109,794 Latin and Central America 144 664 808 Total revenue $ 813,069 $ 69,932 $ 883,001 Year Ended December 31, 2021 Nucleic Acid Production Biologics Safety Testing Protein Detection Total North America $ 280,369 $ 25,686 $ 11,016 $ 317,071 Europe, the Middle East and Africa 377,325 15,597 4,752 397,674 Asia Pacific 54,114 26,471 3,068 83,653 Latin and Central America 56 663 123 842 Total revenue $ 711,864 $ 68,417 $ 18,959 $ 799,240 Year Ended December 31, 2020 Nucleic Acid Production Biologics Safety Testing Protein Detection Total North America $ 115,216 $ 21,787 $ 13,343 $ 150,346 Europe, the Middle East and Africa 69,637 14,862 5,606 90,105 Asia Pacific 21,444 17,946 3,783 43,173 Latin and Central America 23 302 149 474 Total revenue $ 206,320 $ 54,897 $ 22,881 $ 284,098 |
Summary of Property and Equipment | Depreciation is computed using the straight-line method over the following estimated useful lives: Assets Estimated Useful Life Leasehold improvements 12 years Furniture, fixtures, equipment and software 3 - 7 years Property and equipment consisted of the following as of the periods presented (in thousands): December 31, 2022 December 31, 2021 Leasehold improvements $ 20,095 $ 18,162 Furniture, fixtures, and equipment 35,907 31,065 Software 3,004 2,713 Total 59,006 51,940 Less accumulated depreciation (19,502) (12,532) Total 39,504 39,408 Construction in-progress 13,190 6,924 Total property and equipment, net $ 52,694 $ 46,332 |
Summary of Concentration of Revenue | The following table summarizes revenue from each of our customers who individually accounted for 10% or more of our total revenue or accounts receivable for the periods presented: Revenue Accounts Receivable, net Years Ended December 31, As of December 31, 2022 2021 2020 2022 2021 BioNTech SE 34.8 % 29.5 % 16.7 % 12.0 % * Pfizer Inc. 26.4 % 23.3 % 14.2 % 19.2 % 23.6 % CureVac N.V. * 15.3 % * 15.7 % 46.5 % Nacalai USA, Inc. * * * 20.3 % 11.6 % ____________________ * Less than 10% |
Acquisitions and Divestiture (T
Acquisitions and Divestiture (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Summary of Recognized Identified Assets Acquired and Liabilities Assumed | The acquisition date fair value of consideration transferred to acquire MyChem consisted of the following (in thousands): Cash paid (1) $ 240,145 Consideration payable 10,000 Fair value of contingent consideration 7,800 Total consideration transferred $ 257,945 ____________________ (1) Represents cash consideration paid at closing of $240.0 million and a purchase price adjustment paid in November 2022 of $0.1 million. following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date (in thousands): Cash $ 1,176 Current assets 2,741 Intangible assets, net 123,360 Other assets 8,585 Total identifiable assets acquired 135,862 Current liabilities (420) Other long-term liabilities (8,399) Total liabilities assumed (8,819) Net identifiable assets acquired 127,043 Goodwill 130,902 Net assets acquired $ 257,945 |
Summary of Intangible Assets Acquired | The following table summarizes the estimated fair values of MyChem’s identifiable intangible assets as of the date of acquisition and their estimated useful lives: Estimated Fair Value Estimated Useful Life Trade names $ 460 3 Developed technology 121,000 12 Customer relationships 1,900 12 Total $ 123,360 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Goodwill | The following table summarizes the activity in the Company’s goodwill by segment for the periods presented (in thousands): Nucleic Acid Production Biologics Safety Testing Total Balance as of December 31, 2021 $ 32,838 $ 119,928 $ 152,766 Acquisition 130,902 — 130,902 Balance as of December 31, 2022 $ 163,740 $ 119,928 $ 283,668 |
Summary of Components of Finite-Lived Intangible Assets | The following are components of finite-lived intangible assets and accumulated amortization as of the periods presented: December 31, 2022 Gross Accumulated Net Estimated Weighted (in thousands) (in years) (in years) Trade Names $ 7,580 $ 5,746 $ 1,834 3 - 10 3.5 Patents and Developed Technology 288,649 85,058 203,591 10 - 14 9.5 Customer Relationships 21,853 10,615 11,238 10 - 12 6.5 Total $ 318,082 $ 101,419 $ 216,663 9.3 December 31, 2021 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Estimated Useful Life Weighted Average Remaining Amortization Period (in thousands) (in years) (in years) Trade Names $ 7,120 $ 5,012 $ 2,108 5 - 10 2.9 Patents and Developed Technology 167,648 63,465 104,183 5 - 14 8.5 Customer Relationships 19,953 8,673 11,280 10 - 12 6.4 Total $ 194,721 $ 77,150 $ 117,571 8.1 |
Summary of Estimated Future Amortization Expense For Finite-lived Intangible Assets | As of December 31, 2022, the estimated future amortization expense for finite-lived intangible assets were as follows (in thousands): 2023 $ 24,812 2024 24,812 2025 24,669 2026 24,432 2027 23,416 Thereafter 94,522 Total estimated amortization expense $ 216,663 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Summary of Fair Value of Assets Measured on Recurring Basis | The following table summarizes the Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands): Fair Value Measurement as of December 31, 2022 Level 1 Level 2 Level 3 Total Assets Interest rate cap $ — $ 11,362 $ — $ 11,362 |
Summary of Business Acquisitions by Acquisition, Contingent Consideration | The following table provides a reconciliation of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the period presented (in thousands): Contingent Consideration Balance as of December 31, 2021 $ — Contingent consideration related to the acquisition of MyChem 7,800 Change in estimated fair value of contingent consideration (7,800) Balance as of December 31, 2022 $ — |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Summary of Inventory | Inventory consisted of the following as of the periods presented (in thousands): December 31, 2022 December 31, 2021 Raw materials $ 13,486 $ 19,726 Work-in-process 21,950 21,382 Finished goods 7,716 10,449 Total inventory $ 43,152 $ 51,557 |
Summary of Property and Equipment | Depreciation is computed using the straight-line method over the following estimated useful lives: Assets Estimated Useful Life Leasehold improvements 12 years Furniture, fixtures, equipment and software 3 - 7 years Property and equipment consisted of the following as of the periods presented (in thousands): December 31, 2022 December 31, 2021 Leasehold improvements $ 20,095 $ 18,162 Furniture, fixtures, and equipment 35,907 31,065 Software 3,004 2,713 Total 59,006 51,940 Less accumulated depreciation (19,502) (12,532) Total 39,504 39,408 Construction in-progress 13,190 6,924 Total property and equipment, net $ 52,694 $ 46,332 |
Summary of Other Assets | Other assets consisted of the following as of the periods presented (in thousands): December 31, 2022 December 31, 2021 Right-of-use assets $ 63,896 $ 49,095 Prepaid lease payments 27,253 — Interest rate cap 11,362 541 Indemnification asset (see Note 2) 7,682 — Other 5,396 3,815 Total other assets $ 115,589 $ 53,451 |
Summary of Accrued Expenses And Other Current Liabilities | Accrued expenses consisted of the following as of the periods presented (in thousands): December 31, 2022 December 31, 2021 Employee related $ 19,873 $ 18,894 Inventory holdback liability 10,000 — Accrued interest payable 7,700 145 Lease liabilities, current portion 6,269 3,722 Professional services 4,093 2,897 Customer deposits 1,665 2,429 Sales and use tax liability 1,029 1,296 Federal tax liability — 102 Other 2,742 5,089 Total accrued expenses and other current liabilities $ 53,371 $ 34,574 |
Summary of Other Noncurrent Liabilities | Other long-term liabilities consisted of the following as of the periods presented (in thousands): December 31, 2022 December 31, 2021 Non-current lease liabilities $ 51,556 $ 40,906 Accrued Retention Payments (see Note 2) 9,324 — Acquisition related tax liability (see Note 2) 7,682 — Other 413 160 Total other long-term liabilities $ 68,975 $ 41,066 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Summary of Leases Assets and Liabilities | The following table presents supplemental balance sheet information related to the Company's operating leases as of the periods presented below (in thousands): Line Item in the Consolidated Balance Sheet December 31, 2022 December 31, 2021 Right-of-use assets Other assets $ 63,896 $ 49,095 Lease liabilities, current portion Accrued expenses and other current liabilities 6,269 3,722 Non-current lease liabilities Other long-term liabilities 51,556 40,906 |
Summary of Lease Cost | The components of the net lease costs reflected in the Company's consolidated statements of income were as follows for the periods presented (in thousands): Year Ended December 31, 2022 2021 Operating lease costs $ 8,800 $ 8,792 Variable lease costs 2,742 1,759 Total lease costs $ 11,542 $ 10,551 The weighted average remaining lease term and weighted average discount rate related to the Company's ROU assets and lease liabilities for its operating leases were as follows as of the periods presented below: December 31, 2022 December 31, 2021 Weighted average remaining lease term (in years) 7.9 8.2 Weighted average discount rate 6.5 % 5.1 % Supplemental information concerning the cash flow impact arising from the Company's leases recorded in the Company's consolidated statements of cash flows is detailed in the following table for the periods presented (in thousands): Year Ended December 31, 2022 2021 Cash paid for amounts included in lease liabilities: Operating cash flows used for operating leases $ 7,049 $ 6,335 Non-cash transactions: Right-of-use assets obtained in exchange for new operating lease liabilities $ 17,513 $ — |
Summary of Future Operating Lease Payments | As of December 31, 2022, the Company expects that its future minimum lease payments will become due and payable as follows (in thousands): Operating Leases 2023 $ 9,886 2024 10,304 2025 10,386 2026 9,455 2027 7,959 Thereafter 31,177 Total minimum lease payments $ 79,167 Less: interest (21,342) Total lease liabilities $ 57,825 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Summary of Long-Term Debt | The Company’s long-term debt consisted of the following as of the periods presented (in thousands): December 31, 2022 December 31, 2021 Tranche B Term Loan $ 538,560 $ — First Lien Term Loan — 544,000 Unamortized debt issuance costs (11,123) (13,409) Total long-term debt 527,437 530,591 Less: current portion (5,440) (6,000) Total long-term debt, less current portion $ 521,997 $ 524,591 |
Summary of Maturities of Long-Term Debt | As of December 31, 2022, the aggregate future principal maturities of the Company’s debt obligations for each of the next five years, based on contractual due dates, were as follows (in thousands): 2023 $ 5,440 2024 5,440 2025 5,440 2026 5,440 2027 516,800 Total long-term debt $ 538,560 |
Net Income Per Class A Common_2
Net Income Per Class A Common Share/Unit Attributable to Maravai LifeSciences Holdings, Inc. (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Summary of Basic and Diluted Earnings Per Share | The following table presents the computation of basic and diluted net income per common share/unit attributable to the Company for the periods presented (in thousands, except per share and per unit amounts): Year Ended December 31, 2022 2021 2020 Numerator: Net income $ 490,663 $ 469,250 $ 78,816 Less: preferred unit dividends attributable to the MLSC non-controlling interests — — (15,270) Less: (income) loss attributable to common non-controlling interests (270,458) (287,213) 13,342 Net income attributable to Maravai LifeSciences Holdings, Inc.—basic 220,205 182,037 76,888 Net income (loss) effect of dilutive securities: Effect of dilutive employee stock purchase plan, RSUs and options $ 87 132 — Effect of the assumed conversion of Class B common stock 205,984 220,187 (8,802) Net income attributable to Maravai LifeSciences Holdings, Inc.—diluted $ 426,276 $ 402,356 $ 68,086 Denominator: Weighted average Class A common shares/units outstanding—basic 131,545 114,791 10,351 Weighted average effect of dilutive securities: Effect of dilutive employee stock purchase plan, RSUs and options 109 153 1 Effect of the assumed conversion of Class B common stock 123,669 142,859 18,556 Weighted average Class A common shares/units outstanding—diluted 255,323 257,803 28,908 Net income per Class A common share/unit attributable to Maravai LifeSciences Holdings, Inc.: Basic $ 1.67 $ 1.59 $ 7.43 Diluted $ 1.67 $ 1.56 $ 2.36 |
Summary of Dilutive Securities Excluded from Computation of Earnings Per Share | The following table presents potentially dilutive securities excluded from the computation of diluted net income per share/unit for the periods presented because their effect would have been anti-dilutive for the periods presented (in thousands): Year Ended December 31, 2022 2021 2020 Restricted stock units 74 — — Stock options 2,769 355 1,535 Shares estimated to be purchased under employee stock purchase plan 13 12 51 Total 2,856 367 1,586 |
Equity Incentive Plans (Tables)
Equity Incentive Plans (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Stock Option Activity | The following table summarizes information related to stock options: Number of Stock Options Weighted Average Exercise Price per Stock Option Weighted Average Remaining Contractual Life Aggregate Intrinsic Value Outstanding as of December 31, 2021 1,409 $ 30.47 9.0 $ 16,846 Granted 1,709 23.81 Exercised (4) 26.08 Cancelled (221) 31.64 Outstanding as of December 31, 2022 2,893 $ 26.45 8.9 $ — Exercisable as of December 31, 2022 726 $ 28.75 8.2 $ — |
Summary of Weighted Average Assumptions for Stock Options | A summary of the assumptions used to estimate the fair value of stock option grants for the years presented is as follows: Year Ended December 31, 2022 2021 2020 Expected volatility 51.3 % 57.2 % 59.0 % Risk-free interest rate 2.8 % 1.0 % 0.5 % Expected term (in years) 6.1 6.1 6.1 Expected dividend yield — % — % — % |
Summary of Restricted Stock Unit Activity | The Company has granted restricted stock unit awards to employees and non-employee directors. The following table summarizes information related to RSUs: Restricted Stock Units Weighted Average Fair Value per RSU at Grant Date Balance as of December 31, 2021 90 $ 31.96 Granted 1,375 23.99 Vested (69) 33.25 Forfeited (65) 27.30 Balance as of December 31, 2022 1,331 $ 21.04 |
Summary of MLSH 1 Incentive Unit Award Activity | MLSH 1 Incentive Unit award activity during year ended December 31, 2022 is as follows: Number of Unvested MLSH 1 Incentive Units Weighted Average Grant Date Fair Value Per Unit Balance as of December 31, 2021 159 $ 22.20 Forfeited (6) 17.44 Vested (76) 20.39 Balance as of December 31, 2022 77 $ 24.34 |
Summary of Stock-Based Compensation Expense | The following table summarizes the total equity-based compensation expense included in the Company’s consolidated statements of income for the periods presented (in thousands): Year Ended December 31, 2022 2021 2020 Cost of sales $ 4,192 $ 1,915 $ 282 Selling, general and administrative 13,349 8,263 24,216 Research and development 1,129 280 131 Total equity-based compensation $ 18,670 $ 10,458 $ 24,629 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Summary of Income (Loss) Before Income Taxes | Components of income from continuing operations before income taxes for the periods presented were as follows (in thousands): Year Ended December 31, 2022 2021 2020 U.S. $ 551,472 $ 530,853 $ 82,012 International — (88) (316) Total income from continuing operations $ 551,472 $ 530,765 $ 81,696 |
Summary of Income Tax Expense (Benefit) | Income tax expense (benefit) consisted of the following for the periods presented (in thousands): Year Ended December 31, 2022 2021 2020 Current tax expense Federal $ 16,312 $ 9,291 $ 6,093 State and local 2,173 1,623 2,251 International 6 3,697 — Total current tax expense 18,491 14,611 8,344 Deferred tax expense (benefit) Federal $ 39,924 $ 36,564 $ (3,922) State and local 2,394 10,340 (1,542) Total deferred tax expense (benefit) 42,318 46,904 (5,464) Total provision for income taxes $ 60,809 $ 61,515 $ 2,880 |
Summary of Income Tax Rate Reconciliation | A reconciliation between the Company’s effective tax rate and the applicable U.S. federal statutory income tax rate as of the periods presented is summarized as follows: December 31, 2022 December 31, 2021 December 31, 2020 Federal statutory rate 21.0 % 21.0 % 21.0 % State and local taxes, net of federal benefits 0.6 2.2 0.3 Deferred tax revaluation 0.3 — (1.8) Income of non-controlling interest (10.3) (11.4) (18.9) Taxable (loss) gain on subsidiary liquidation — (0.7) 2.7 Equity-based compensation — 0.1 1.3 Research and development credits (0.1) (0.4) (0.1) Valuation allowance 0.1 0.1 (1.5) Other (0.6) 0.7 0.5 Effective tax rate 11.0 % 11.6 % 3.5 % |
Summary of Deferred Tax Assets and Liabilities | Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes and operating loss and tax credit carryforwards. Significant items comprising the net deferred tax assets were as follows as of the periods presented below (in thousands): December 31, 2022 December 31, 2021 Deferred tax assets Investment in Topco LLC $ 636,498 $ 675,855 Deductions to be received for the Tax Receivable Agreement payments 148,681 154,093 Capital loss carryforward 3,265 — Other 1,131 1,249 Total deferred tax assets 789,575 831,197 Valuation allowance (23,776) (23,080) Total deferred tax assets, net of valuation allowance $ 765,799 $ 808,117 |
Summary of Operating Loss Carryforwards | Net operating loss (“NOL”) and tax credit carryforwards as of December 31, 2022 were as follows (in millions): Amount Expiration Years Capital loss carryforward $ 3.3 2026 Tax credits, state $ 0.1 CA - Do not expire |
Summary of Tax Credit Carryforwards | Net operating loss (“NOL”) and tax credit carryforwards as of December 31, 2022 were as follows (in millions): Amount Expiration Years Capital loss carryforward $ 3.3 2026 Tax credits, state $ 0.1 CA - Do not expire |
Summary of Unrecognized Tax Benefits | The aggregate changes in the balance of the Company’s unrecognized tax benefits were as follows for the periods presented (in thousands): Year Ended December 31, 2022 2021 2020 Balance, beginning of year $ 241 $ 220 $ 208 Gross increases based on tax positions related to current year 130 232 62 Gross increases based on tax positions related to prior years 6,775 — — Gross decreases based on tax positions related to prior years (889) (211) (50) Balance, end of year $ 6,257 $ 241 $ 220 |
Segments (Tables)
Segments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Summary of Segment Reporting Information | The following schedule includes revenue and adjusted EBITDA for each of the Company’s reportable operating segments (in thousands). We have revised our presentation for the prior periods below to remove the presentation of Total Adjusted EBITDA and reconcile the total of our reportable segments’ measure of profit or loss to income before income taxes in addition to net income, and removed corporate costs, net of eliminations from total reportable segments’ adjusted EBITDA and included such amounts in the reconciliation to income before income taxes. Additionally, we have revised our prior years’ presentation of our total reportable segments’ revenue, in which we removed intersegment eliminations from our total reportable segment’s revenue. Year Ended December 31, 2022 2021 2020 Revenue: Nucleic Acid Production $ 813,076 $ 712,520 $ 207,597 Biologics Safety Testing 69,932 68,417 54,897 Protein Detection — 18,959 22,881 Total reportable segments’ revenue 883,008 799,896 285,375 Intersegment eliminations (7) (656) (1,277) Total $ 883,001 $ 799,240 $ 284,098 Segment adjusted EBITDA: Nucleic Acid Production $ 638,337 $ 565,254 $ 133,822 Biologics Safety Testing 54,841 54,440 44,516 Protein Detection — 6,391 9,225 Total reportable segments’ adjusted EBITDA 693,178 626,085 187,563 Reconciliation of total reportable segments’ adjusted EBITDA to income before income taxes Amortization (24,269) (18,339) (20,320) Depreciation (7,566) (6,413) (5,593) Interest expense (20,414) (30,260) (30,740) Interest income 2,338 — — Corporate costs, net of eliminations (55,378) (43,265) (18,398) Other adjustments: Acquisition contingent consideration 7,800 — — Acquisition integration costs (13,362) (44) (3,857) Acquired in-process research and development costs — — (2,881) Equity-based compensation (18,670) (10,458) (24,629) GTCR management fees — — (680) Gain on sale of business — 11,249 — Gain on sale and leaseback transaction — — 19,002 Merger and acquisition related expenses (2,416) (1,508) (395) Financing costs (1,078) (2,383) (9,784) Acquisition related tax adjustment (349) — — Tax Receivable Agreement liability adjustment (4,102) 6,101 — Chief Executive Officer transition costs (2,426) — — Other (1,814) — (7,592) Income before income taxes 551,472 530,765 81,696 Income tax expense (60,809) (61,515) (2,880) Net income $ 490,663 $ 469,250 $ 78,816 |
Summary of Reconciliation of Revenue | The following schedule includes revenue and adjusted EBITDA for each of the Company’s reportable operating segments (in thousands). We have revised our presentation for the prior periods below to remove the presentation of Total Adjusted EBITDA and reconcile the total of our reportable segments’ measure of profit or loss to income before income taxes in addition to net income, and removed corporate costs, net of eliminations from total reportable segments’ adjusted EBITDA and included such amounts in the reconciliation to income before income taxes. Additionally, we have revised our prior years’ presentation of our total reportable segments’ revenue, in which we removed intersegment eliminations from our total reportable segment’s revenue. Year Ended December 31, 2022 2021 2020 Revenue: Nucleic Acid Production $ 813,076 $ 712,520 $ 207,597 Biologics Safety Testing 69,932 68,417 54,897 Protein Detection — 18,959 22,881 Total reportable segments’ revenue 883,008 799,896 285,375 Intersegment eliminations (7) (656) (1,277) Total $ 883,001 $ 799,240 $ 284,098 Segment adjusted EBITDA: Nucleic Acid Production $ 638,337 $ 565,254 $ 133,822 Biologics Safety Testing 54,841 54,440 44,516 Protein Detection — 6,391 9,225 Total reportable segments’ adjusted EBITDA 693,178 626,085 187,563 Reconciliation of total reportable segments’ adjusted EBITDA to income before income taxes Amortization (24,269) (18,339) (20,320) Depreciation (7,566) (6,413) (5,593) Interest expense (20,414) (30,260) (30,740) Interest income 2,338 — — Corporate costs, net of eliminations (55,378) (43,265) (18,398) Other adjustments: Acquisition contingent consideration 7,800 — — Acquisition integration costs (13,362) (44) (3,857) Acquired in-process research and development costs — — (2,881) Equity-based compensation (18,670) (10,458) (24,629) GTCR management fees — — (680) Gain on sale of business — 11,249 — Gain on sale and leaseback transaction — — 19,002 Merger and acquisition related expenses (2,416) (1,508) (395) Financing costs (1,078) (2,383) (9,784) Acquisition related tax adjustment (349) — — Tax Receivable Agreement liability adjustment (4,102) 6,101 — Chief Executive Officer transition costs (2,426) — — Other (1,814) — (7,592) Income before income taxes 551,472 530,765 81,696 Income tax expense (60,809) (61,515) (2,880) Net income $ 490,663 $ 469,250 $ 78,816 |
Organization and Significant _4
Organization and Significant Accounting Policies - Description of Business (Details) | 12 Months Ended |
Dec. 31, 2022 segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of operating segments | 3 |
Organization and Significant _5
Organization and Significant Accounting Policies - Contract balances (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Contract assets | $ 0 | $ 0 |
Contract liabilities | $ 4,800,000 | $ 12,600,000 |
Organization and Significant _6
Organization and Significant Accounting Policies - Geographical Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 883,001 | $ 799,240 | $ 284,098 |
North America | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 339,473 | 317,071 | 150,346 |
Europe, the Middle East and Africa | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 432,926 | 397,674 | 90,105 |
Asia Pacific | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 109,794 | 83,653 | 43,173 |
Latin and Central America | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 808 | 842 | 474 |
Nucleic Acid Production | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 813,069 | 711,864 | 206,320 |
Nucleic Acid Production | North America | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 312,119 | 280,369 | 115,216 |
Nucleic Acid Production | Europe, the Middle East and Africa | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 415,298 | 377,325 | 69,637 |
Nucleic Acid Production | Asia Pacific | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 85,508 | 54,114 | 21,444 |
Nucleic Acid Production | Latin and Central America | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 144 | 56 | 23 |
Biologics Safety Testing | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 69,932 | 68,417 | 54,897 |
Biologics Safety Testing | North America | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 27,354 | 25,686 | 21,787 |
Biologics Safety Testing | Europe, the Middle East and Africa | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 17,628 | 15,597 | 14,862 |
Biologics Safety Testing | Asia Pacific | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 24,286 | 26,471 | 17,946 |
Biologics Safety Testing | Latin and Central America | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 664 | 663 | 302 |
Protein Detection | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 18,959 | 22,881 | |
Protein Detection | North America | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 11,016 | 13,343 | |
Protein Detection | Europe, the Middle East and Africa | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 4,752 | 5,606 | |
Protein Detection | Asia Pacific | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 3,068 | 3,783 | |
Protein Detection | Latin and Central America | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 123 | $ 149 |
Organization and Significant _7
Organization and Significant Accounting Policies - Shipping and Handling Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | |||
Cost of revenue | $ 168,957 | $ 140,561 | $ 79,649 |
Shipping and Handling | |||
Disaggregation of Revenue [Line Items] | |||
Cost of revenue | $ 3,200 | $ 3,600 | $ 3,300 |
Organization and Significant _8
Organization and Significant Accounting Policies - Advertising Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Advertising costs | $ 2.5 | $ 1.3 | $ 1.2 |
Organization and Significant _9
Organization and Significant Accounting Policies - Equity Based Compensation (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Minimum | |
Net income per Class A common share/unit: | |
Requisite service period | 2 years |
Maximum | |
Net income per Class A common share/unit: | |
Requisite service period | 4 years |
Organization and Significant_10
Organization and Significant Accounting Policies - Payables to Related Parties Pursuant to the Tax Receivable Agreement (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Percentage of tax benefits paid | 85% |
Percentage of tax benefits unpaid | 15% |
Organization and Significant_11
Organization and Significant Accounting Policies - Non-Controlling Interests (Details) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Nov. 30, 2022 | Nov. 30, 2020 USD ($) | Dec. 31, 2022 | Oct. 31, 2020 | |
Noncontrolling Interest [Line Items] | ||||
Stock conversion ratio | 1 | 1 | ||
Topco LLC | ||||
Noncontrolling Interest [Line Items] | ||||
Ownership percent by parent | 51.60% | |||
Ownership percent by noncontrolling interest | 30% | |||
MLSH 1 | Topco LLC | ||||
Noncontrolling Interest [Line Items] | ||||
Ownership percent by parent | 70% | |||
Ownership percent by noncontrolling interest | 48.40% | |||
Purchase of non-controlling interests | $ 166.4 |
Organization and Significant_12
Organization and Significant Accounting Policies - Segment Information (Details) - segment | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Number of reportable segments | 2 | 3 |
Organization and Significant_13
Organization and Significant Accounting Policies - Accounts Receivable and Allowance for Credit Losses (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Allowance for doubtful accounts | $ 2.2 | $ 0.3 |
Organization and Significant_14
Organization and Significant Accounting Policies - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | 12 years |
Minimum | Furniture, fixtures, and equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | 3 years |
Maximum | Furniture, fixtures, and equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | 7 years |
Organization and Significant_15
Organization and Significant Accounting Policies - Concentration Risk (Details) - Customer Concentration Risk | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue | BioNTech SE | |||
Product Information [Line Items] | |||
Concentration risk | 34.80% | 29.50% | 16.70% |
Revenue | Pfizer Inc. | |||
Product Information [Line Items] | |||
Concentration risk | 26.40% | 23.30% | 14.20% |
Revenue | CureVac N.V. | |||
Product Information [Line Items] | |||
Concentration risk | 15.30% | ||
Accounts Receivable, net | BioNTech SE | |||
Product Information [Line Items] | |||
Concentration risk | 12% | ||
Accounts Receivable, net | Pfizer Inc. | |||
Product Information [Line Items] | |||
Concentration risk | 19.20% | 23.60% | |
Accounts Receivable, net | CureVac N.V. | |||
Product Information [Line Items] | |||
Concentration risk | 15.70% | 46.50% | |
Accounts Receivable, net | Nacalai USA, Inc. | |||
Product Information [Line Items] | |||
Concentration risk | 20.30% | 11.60% |
Acquisitions and Divestiture -
Acquisitions and Divestiture - Narrative (Details) $ in Thousands | 3 Months Ended | 10 Months Ended | 12 Months Ended | |||
Jan. 27, 2022 USD ($) | Dec. 31, 2022 USD ($) | Nov. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Business Acquisition [Line Items] | ||||||
Merger and acquisition related expenses | $ 2,416 | $ 1,508 | $ 395 | |||
Contingent consideration | $ 0 | 0 | $ 0 | |||
MyChem | ||||||
Business Acquisition [Line Items] | ||||||
Consideration transferred | $ 257,900 | $ 257,945 | ||||
Merger and acquisition related expenses | 3,500 | |||||
Goodwill purchase adjustment | 100 | |||||
Decrease in other assets | 700 | |||||
Decrease in current liabilities | 700 | |||||
Indemnification asset amount | $ 8,000 | |||||
MyChem | Measurement Input, Revenue Growth Rate | Valuation Technique, Discounted Cash Flow | Minimum | ||||||
Business Acquisition [Line Items] | ||||||
Intangible assets, measurement input | 0.030 | |||||
MyChem | Measurement Input, Revenue Growth Rate | Valuation Technique, Discounted Cash Flow | Maximum | ||||||
Business Acquisition [Line Items] | ||||||
Intangible assets, measurement input | 0.306 | |||||
MyChem | Measurement Input, Discount Rate | Valuation Technique, Discounted Cash Flow | ||||||
Business Acquisition [Line Items] | ||||||
Intangible assets, measurement input | 0.165 | |||||
MyChem | Measurement Input, Obsolescent Curve | Valuation Technique, Discounted Cash Flow | Minimum | ||||||
Business Acquisition [Line Items] | ||||||
Intangible assets, measurement input | 0.050 | |||||
MyChem | Measurement Input, Obsolescent Curve | Valuation Technique, Discounted Cash Flow | Maximum | ||||||
Business Acquisition [Line Items] | ||||||
Intangible assets, measurement input | 0.075 | |||||
MyChem | Potential Working Capital Adjustments | ||||||
Business Acquisition [Line Items] | ||||||
Escrow deposit | $ 1,000 | |||||
Additional escrow deposit payments | 100 | |||||
MyChem | Secure Representations and Warranties | ||||||
Business Acquisition [Line Items] | ||||||
Escrow deposit | $ 12,500 | |||||
MyChem | MyChem Legacy Owners | ||||||
Business Acquisition [Line Items] | ||||||
Service period | 2 years | |||||
MyChem | SPA, Maximum Performance Payment | ||||||
Business Acquisition [Line Items] | ||||||
Contingent consideration | $ 40,000 | |||||
MyChem | SPA, Retention Payment | ||||||
Business Acquisition [Line Items] | ||||||
Contingent consideration | $ 20,000 | |||||
MyChem | SPA, Retention Payment | MyChem Legacy Owners | ||||||
Business Acquisition [Line Items] | ||||||
Compensation expense | 9,300 | |||||
MyChem | SPA, Completion of Acquired Inventory | ||||||
Business Acquisition [Line Items] | ||||||
Contingent consideration | $ 10,000 | $ 10,000 |
Acquisitions and Divestiture _2
Acquisitions and Divestiture - Summary of Consideration Transferred (Details) - MyChem - USD ($) $ in Thousands | 1 Months Ended | 10 Months Ended | 12 Months Ended | |
Jan. 27, 2022 | Nov. 30, 2022 | Nov. 30, 2022 | Dec. 31, 2022 | |
Business Acquisition [Line Items] | ||||
Payment of cash to acquire business | $ 240,000 | $ 100 | $ 240,145 | |
Consideration payable | 10,000 | |||
Fair value of contingent consideration | 7,800 | 7,800 | $ 7,800 | |
Total consideration transferred | $ 257,900 | $ 257,945 |
Acquisitions and Divestiture _3
Acquisitions and Divestiture - Summary of Assets and Liabilities Acquired (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jan. 27, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | |||
Goodwill | $ 283,668 | $ 152,766 | |
MyChem | |||
Business Acquisition [Line Items] | |||
Cash | $ 1,176 | ||
Current assets | 2,741 | ||
Intangible assets, net | 123,360 | ||
Other assets | 8,585 | ||
Total identifiable assets acquired | 135,862 | ||
Current liabilities | (420) | ||
Other long-term liabilities | (8,399) | ||
Total liabilities assumed | (8,819) | ||
Net identifiable assets acquired | 127,043 | ||
Goodwill | 130,902 | ||
Net assets acquired | $ 257,945 |
Acquisitions and Divestiture _4
Acquisitions and Divestiture - Summary of Intangible Assets Acquired (Details) - MyChem $ in Thousands | Jan. 27, 2022 USD ($) |
Business Acquisition [Line Items] | |
Intangible assets, net | $ 123,360 |
Trade Names | |
Business Acquisition [Line Items] | |
Intangible assets, net | $ 460 |
Estimated Useful Life (in years) | 3 years |
Developed technology | |
Business Acquisition [Line Items] | |
Intangible assets, net | $ 121,000 |
Estimated Useful Life (in years) | 12 years |
Customer Relationships | |
Business Acquisition [Line Items] | |
Intangible assets, net | $ 1,900 |
Estimated Useful Life (in years) | 12 years |
Acquisitions and Divestiture _5
Acquisitions and Divestiture - Mock V Acquisition (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Mar. 31, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | ||||
Research and development | $ 18,369 | $ 15,219 | $ 9,304 | |
MockV | ||||
Business Acquisition [Line Items] | ||||
Consideration transferred | $ 3,000 | |||
Acquisition costs | 200 | |||
Intangible assets, net | 2,900 | |||
Research and development | 2,900 | |||
Maximum contingent cash payments | $ 9,000 |
Acquisitions and Divestiture _6
Acquisitions and Divestiture - Divestiture (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Sep. 30, 2021 | Aug. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Gain on sale of business | $ 0 | $ 11,249 | $ 0 | ||
MLSH 1 Incentive Unit | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Accelerated expense | 2,400 | ||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Vector | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Proceeds from divestiture | $ 124,000 | ||||
Cash from divestiture | $ 120,700 | ||||
Gain on sale of business | 11,200 | ||||
Transaction costs | $ 900 | ||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Vector | Minimum | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Initial services period | 1 month | ||||
Extension periods for services | 1 month | ||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Vector | Maximum | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Initial services period | 5 months | ||||
Extension periods for services | 8 months |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Narrative (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Dec. 31, 2022 USD ($) reporting_unit | Dec. 31, 2022 USD ($) reporting_unit | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Mar. 31, 2022 USD ($) | Jan. 27, 2022 USD ($) | |
Finite-Lived Intangible Assets [Line Items] | ||||||
Goodwill | $ 283,668 | $ 283,668 | $ 152,766 | |||
Number of reporting units | reporting_unit | 3 | 3 | ||||
Amortization of intangible assets | $ 24,269 | 18,339 | $ 20,320 | |||
MyChem | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Goodwill | $ 130,902 | |||||
Intangible assets | $ 123,400 | |||||
Cost of sales | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Amortization of intangible assets | 21,500 | 12,400 | 12,700 | |||
Selling, general and administrative | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Amortization of intangible assets | $ 2,800 | 5,900 | $ 7,600 | |||
Minimum | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Estimated useful life | 3 years | |||||
Maximum | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Estimated useful life | 14 years | |||||
Nucleic Acid Production | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Goodwill | $ 163,740 | $ 163,740 | $ 32,838 | |||
Number of reporting units | reporting_unit | 2 | |||||
Protein Detection | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Goodwill acquired | $ 130,900 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Summary of Segment's Goodwill (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Goodwill [Roll Forward] | |
Beginning balance | $ 152,766 |
Divestiture | 130,902 |
Ending balance | 283,668 |
Nucleic Acid Production | |
Goodwill [Roll Forward] | |
Beginning balance | 32,838 |
Divestiture | 130,902 |
Ending balance | 163,740 |
Biologics Safety Testing | |
Goodwill [Roll Forward] | |
Beginning balance | 119,928 |
Divestiture | 0 |
Ending balance | $ 119,928 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Summary of Components of Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 318,082 | $ 194,721 |
Accumulated Amortization | 101,419 | 77,150 |
Net Carrying Amount | $ 216,663 | $ 117,571 |
Weighted Average Remaining Amortization Period | 9 years 3 months 18 days | 8 years 1 month 6 days |
Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 3 years | |
Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 14 years | |
Trade Names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 7,580 | $ 7,120 |
Accumulated Amortization | 5,746 | 5,012 |
Net Carrying Amount | $ 1,834 | $ 2,108 |
Weighted Average Remaining Amortization Period | 3 years 6 months | 2 years 10 months 24 days |
Trade Names | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 3 years | 5 years |
Trade Names | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 10 years | 10 years |
Patents and Developed Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 288,649 | $ 167,648 |
Accumulated Amortization | 85,058 | 63,465 |
Net Carrying Amount | $ 203,591 | $ 104,183 |
Weighted Average Remaining Amortization Period | 9 years 6 months | 8 years 6 months |
Patents and Developed Technology | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 10 years | 5 years |
Patents and Developed Technology | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 14 years | 14 years |
Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 21,853 | $ 19,953 |
Accumulated Amortization | 10,615 | 8,673 |
Net Carrying Amount | $ 11,238 | $ 11,280 |
Weighted Average Remaining Amortization Period | 6 years 6 months | 6 years 4 months 24 days |
Customer Relationships | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 10 years | 10 years |
Customer Relationships | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 12 years | 12 years |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Expected Amortization of Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2023 | $ 24,812 | |
2024 | 24,812 | |
2025 | 24,669 | |
2026 | 24,432 | |
2027 | 23,416 | |
Thereafter | 94,522 | |
Net Carrying Amount | $ 216,663 | $ 117,571 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Recurring Assets (Details) - Fair Value, Recurring $ in Thousands | Dec. 31, 2022 USD ($) |
Assets | |
Derivative assets | $ 11,362 |
Level 1 | |
Assets | |
Derivative assets | 0 |
Level 2 | |
Assets | |
Derivative assets | 11,362 |
Level 3 | |
Assets | |
Derivative assets | $ 0 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) $ in Thousands | 3 Months Ended | 10 Months Ended | 12 Months Ended | |||
Jan. 27, 2022 USD ($) | Jun. 30, 2022 USD ($) | Nov. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Contingent consideration | $ 0 | $ 0 | ||||
Decrease in estimated fair value of contingent consideration | (7,800) | $ 0 | $ 0 | |||
MyChem | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Fair value of contingent consideration | $ 7,800 | $ 7,800 | $ 7,800 | |||
Decrease in estimated fair value of contingent consideration | $ (7,800) | |||||
MyChem | Measurement Input, Discount Rate | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Contingent consideration liability, measurement input | 0.169 | |||||
MyChem | SPA, Maximum Performance Payment | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Contingent consideration | $ 40,000 |
Fair Value Measurements - Sum_2
Fair Value Measurements - Summary of Contingent Consideration (Details) - USD ($) $ in Thousands | 3 Months Ended | 10 Months Ended | 12 Months Ended | |||
Jan. 27, 2022 | Jun. 30, 2022 | Nov. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Combination, Contingent Consideration, Liability [Roll Forward] | ||||||
Beginning balance | $ 0 | |||||
Change in estimated fair value of contingent consideration | (7,800) | $ 0 | $ 0 | |||
Ending balance | 0 | $ 0 | ||||
MyChem | ||||||
Business Combination, Contingent Consideration, Liability [Roll Forward] | ||||||
Contingent consideration related to the acquisition of MyChem | $ 7,800 | $ 7,800 | $ 7,800 | |||
Change in estimated fair value of contingent consideration | $ (7,800) |
Balance Sheet Components - Inve
Balance Sheet Components - Inventory (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 13,486 | $ 19,726 |
Work-in-process | 21,950 | 21,382 |
Finished goods | 7,716 | 10,449 |
Total inventory | $ 43,152 | $ 51,557 |
Balance Sheet Components - Prop
Balance Sheet Components - Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Line Items] | |||
Less accumulated depreciation | $ (19,502) | $ (12,532) | |
Total property and equipment, net | 52,694 | 46,332 | |
Depreciation | 7,566 | 6,413 | $ 5,593 |
Depreciable Property, Plant and Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 59,006 | 51,940 | |
Total property and equipment, net | 39,504 | 39,408 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 20,095 | 18,162 | |
Furniture, fixtures, and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 35,907 | 31,065 | |
Software | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 3,004 | 2,713 | |
Construction in-progress | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 13,190 | $ 6,924 |
Balance Sheet Components - Othe
Balance Sheet Components - Other Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Right-of-use assets | $ 63,896 | $ 49,095 |
Prepaid lease payments | 27,253 | 0 |
Interest rate cap | 11,362 | 541 |
Indemnification asset (see Note 2) | 7,682 | 0 |
Other | 5,396 | 3,815 |
Total other assets | $ 115,589 | $ 53,451 |
Balance Sheet Components - Summ
Balance Sheet Components - Summary of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Employee related | $ 19,873 | $ 18,894 |
Inventory holdback liability | 10,000 | 0 |
Accrued interest payable | 7,700 | 145 |
Lease liabilities, current portion | 6,269 | 3,722 |
Professional services | 4,093 | 2,897 |
Customer deposits | 1,665 | 2,429 |
Sales and use tax liability | 1,029 | 1,296 |
Federal tax liability | 0 | 102 |
Other | 2,742 | 5,089 |
Total accrued expenses and other current liabilities | $ 53,371 | $ 34,574 |
Balance Sheet Components - Ot_2
Balance Sheet Components - Other Long-term Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Operating lease liabilities, less current portion | $ 51,556 | $ 40,906 |
Accrued Retention Payments | 9,324 | 0 |
Acquisition related tax liability | 7,682 | 0 |
Other | 413 | 160 |
Total other long-term liabilities | $ 68,975 | $ 41,066 |
Government Assistance (Details)
Government Assistance (Details) - Cooperative Agreement - USD ($) $ in Millions | 1 Months Ended | |
May 31, 2022 | Dec. 31, 2022 | |
Gain Contingencies [Line Items] | ||
Expectation of reimbursement amount from government | $ 38.8 | |
Percentage of reimbursable costs | 50% | |
Priority access period | 10 years | |
Government assistance received | $ 18.1 | |
Government Assistance, Statement of Financial Position [Extensible Enumeration] | Other assets, Property and equipment, net | |
Government contract receivable | $ 8.2 | |
Other Assets | ||
Gain Contingencies [Line Items] | ||
Government assistance received | $ 17 | |
Government Assistance, Statement of Financial Position [Extensible Enumeration] | Other assets | |
Property, Plant and Equipment | ||
Gain Contingencies [Line Items] | ||
Government assistance received | $ 1.1 | |
Government Assistance, Statement of Financial Position [Extensible Enumeration] | Property and equipment, net |
Leases - Narrative (Details)
Leases - Narrative (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2022 USD ($) building reporting_unit | |
Leland, North Carolina | |
Lessee, Lease, Description [Line Items] | |
Renewal term | 5 years |
Initial term | 10 years |
Number of extension options | reporting_unit | 4 |
San Diego Facility Lease | |
Lessee, Lease, Description [Line Items] | |
Total future minimum lease payments for leases not yet commenced | $ | $ 37.1 |
Number of buildings leased | building | 2 |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Renewal term | 20 years |
Leases - Summary of Leases on B
Leases - Summary of Leases on Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other assets | Other assets |
Operating lease right-of-use assets | $ 63,896 | $ 49,095 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued expenses and other current liabilities | Accrued expenses and other current liabilities |
Current portion of operating lease liabilities | $ 6,269 | $ 3,722 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other long-term liabilities | Other long-term liabilities |
Operating lease liabilities, less current portion | $ 51,556 | $ 40,906 |
Leases - Lease Components (Deta
Leases - Lease Components (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | |||
Operating lease costs | $ 8,800 | $ 8,792 | |
Variable lease costs | 2,742 | 1,759 | |
Total lease costs | $ 11,542 | $ 10,551 | |
Weighted average remaining lease term (in years) | 7 years 10 months 24 days | 8 years 2 months 12 days | |
Weighted average discount rate | 6.50% | 5.10% | |
Cash paid for amounts included in lease liabilities: | |||
Operating cash flows used for operating leases | $ 7,049 | $ 6,335 | |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 17,513 | $ 0 | $ 0 |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Operating Leases | |
2023 | $ 9,886 |
2024 | 10,304 |
2025 | 10,386 |
2026 | 9,455 |
2027 | 7,959 |
Thereafter | 31,177 |
Total minimum lease payments | 79,167 |
Less: interest | (21,342) |
Total lease liabilities | $ 57,825 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) | 1 Months Ended | 11 Months Ended | 12 Months Ended | ||||||||||||
Mar. 31, 2022 USD ($) | Jan. 31, 2022 USD ($) | Dec. 31, 2020 USD ($) | Nov. 30, 2020 USD ($) | Oct. 31, 2020 USD ($) | Mar. 31, 2020 USD ($) | Aug. 31, 2018 USD ($) | Nov. 19, 2020 USD ($) | Dec. 31, 2022 USD ($) loan | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | May 31, 2022 USD ($) | Aug. 31, 2021 USD ($) | Jan. 31, 2021 USD ($) | Jan. 01, 2021 USD ($) | |
Debt Instrument [Line Items] | |||||||||||||||
Long-term debt | $ 544,000,000 | $ 400,000,000 | $ 527,437,000 | $ 530,591,000 | |||||||||||
Repayments of lines of credit | $ 50,000,000 | ||||||||||||||
Loss on extinguishment of debt | 208,000 | 0 | $ 7,592,000 | ||||||||||||
Distribution | $ 8,171,000 | $ 52,000,000 | $ 88,880,000 | 150,065,000 | 153,492,000 | ||||||||||
Interest rate cap | 11,362,000 | $ 541,000 | |||||||||||||
Interest Rate Cap | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Derivative, notional amount | $ 415,000,000 | $ 500,000,000 | |||||||||||||
Interest rate cap | 11,400,000 | ||||||||||||||
New Credit Agreement | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Loss on extinguishment of debt | $ 200,000 | $ 7,600,000 | |||||||||||||
Number of term loans | loan | 2 | ||||||||||||||
Proceeds from debt | $ 8,500,000 | ||||||||||||||
New Credit Agreement | Line of Credit | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Line of credit facility, maximum borrowing capacity | $ 780,000,000 | ||||||||||||||
New Credit Agreement | Line of Credit | London Interbank Offered Rate (LIBOR) | Minimum | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Basis spread on variable rate | 3.75% | ||||||||||||||
New Credit Agreement | Line of Credit | London Interbank Offered Rate (LIBOR) | Maximum | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Basis spread on variable rate | 4.25% | ||||||||||||||
New Credit Agreement | Line of Credit | Base Rate | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Basis spread on variable rate | 2% | ||||||||||||||
New Credit Agreement | Line of Credit | Base Rate | Minimum | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Basis spread on variable rate | 2.75% | ||||||||||||||
New Credit Agreement | Line of Credit | Base Rate | Maximum | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Basis spread on variable rate | 3.25% | ||||||||||||||
New Credit Agreement | Line of Credit | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Basis spread on variable rate | 3% | ||||||||||||||
New Credit Agreement | Secured Debt | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Repayments of debt | $ 8,500,000 | ||||||||||||||
New Credit Agreement | Secured Debt | Line of Credit | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Line of credit facility, maximum borrowing capacity | $ 600,000,000 | ||||||||||||||
Interest rate | 6.96% | ||||||||||||||
Debt issuance costs | 6,000,000 | $ 900,000 | $ 15,800,000 | ||||||||||||
Leverage ratio covenant | 4.25 | ||||||||||||||
Excess cash threshold amount | $ 10,000,000 | ||||||||||||||
Periodic payments | $ 1,400,000 | ||||||||||||||
New Credit Agreement | Secured Debt | Line of Credit | Vector | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Long-term debt | $ 118,400,000 | ||||||||||||||
New Credit Agreement | Secured Debt | Line of Credit | Minimum | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Excess cash ratio percentage | 0% | ||||||||||||||
New Credit Agreement | Secured Debt | Line of Credit | Maximum | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Excess cash ratio percentage | 25% | ||||||||||||||
Leverage ratio covenant | 4.75 | ||||||||||||||
New Credit Agreement | Revolving Credit Facility | Line of Credit | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Line of credit facility, maximum borrowing capacity | 180,000,000 | ||||||||||||||
Debt issuance costs | 300,000 | $ 3,500,000 | $ 2,200,000 | ||||||||||||
Outstanding line of credit | $ 0 | ||||||||||||||
New Credit Agreement | Revolving Credit Facility | Line of Credit | Minimum | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Commitment fee | 0.25% | ||||||||||||||
New Credit Agreement | Revolving Credit Facility | Line of Credit | Maximum | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Commitment fee | 0.375% | ||||||||||||||
New Credit Agreement | Letter of Credit | Line of Credit | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Line of credit facility, maximum borrowing capacity | $ 20,000,000 | ||||||||||||||
Initial Term Loans | Line of Credit | Base Rate | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Interest rate floor | 1.50% | 2% | |||||||||||||
Initial Term Loans | Line of Credit | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Interest rate floor | 0.50% | ||||||||||||||
Non Initial Term Loans | Line of Credit | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Interest rate floor | 0% | ||||||||||||||
First Lien Credit Agreement | Secured Debt | Line of Credit | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Line of credit facility, maximum borrowing capacity | $ 250,000,000 | ||||||||||||||
First Lien Credit Agreement | Secured Debt | Line of Credit | Minimum | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Commitment fee | 0.375% | ||||||||||||||
First Lien Credit Agreement | Secured Debt | Line of Credit | Maximum | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Commitment fee | 0.50% | ||||||||||||||
First Lien Credit Agreement | Revolving Credit Facility | Line of Credit | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Line of credit facility, maximum borrowing capacity | $ 50,000,000 | ||||||||||||||
Proceeds from line of credit | $ 15,000,000 | ||||||||||||||
Second Lien Credit Agreement | Secured Debt | Line of Credit | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Line of credit facility, maximum borrowing capacity | $ 100,000,000 |
Long-Term Debt - Summary of Lon
Long-Term Debt - Summary of Long-Term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jan. 31, 2022 | Dec. 31, 2021 | Oct. 31, 2020 |
Debt Instrument [Line Items] | ||||
Long-term debt, gross | $ 538,560 | |||
Unamortized debt issuance costs | (11,123) | $ (13,409) | ||
Total long-term debt | 527,437 | $ 544,000 | 530,591 | $ 400,000 |
Less: current portion | (5,440) | (6,000) | ||
Long-term debt, less current portion | 521,997 | 524,591 | ||
Secured Debt | New Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | 0 | 544,000 | ||
Secured Debt | New Credit Agreement | Line of Credit | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | $ 538,560 | $ 0 |
Long-Term Debt - Maturities of
Long-Term Debt - Maturities of Long-Term Debt (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Long-term Debt, Fiscal Year Maturity [Abstract] | |
2023 | $ 5,440 |
2024 | 5,440 |
2025 | 5,440 |
2026 | 5,440 |
2027 | 516,800 |
Total long-term debt | $ 538,560 |
Stockholders' _ Member's Equi_2
Stockholders' / Member's Equity - Narrative (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2021 $ / shares shares | Nov. 20, 2020 USD ($) $ / shares shares | Nov. 30, 2022 | Dec. 31, 2021 USD ($) $ / shares shares | Sep. 30, 2021 USD ($) $ / shares shares | Apr. 30, 2021 USD ($) $ / shares shares | Dec. 31, 2020 USD ($) | Dec. 31, 2020 USD ($) | Nov. 30, 2020 USD ($) $ / shares shares | Aug. 31, 2018 USD ($) | Nov. 19, 2020 USD ($) shares | Dec. 31, 2022 USD ($) vote $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2020 USD ($) | |
Net income per Class A common share/unit: | ||||||||||||||
Payments to noncontrolling interest | $ | $ 0 | $ 0 | $ 120,005 | |||||||||||
Stock conversion ratio | 1 | 1 | ||||||||||||
Distribution | $ | $ 8,171 | $ 52,000 | $ 88,880 | $ 150,065 | $ 153,492 | |||||||||
Preferred stock authorized (in shares) | 50,000,000 | |||||||||||||
Preferred stock par value (in usd per share) | $ / shares | $ 0.01 | |||||||||||||
Repurchase and retirement of Class A common from MLSH 2 | $ | $ 33,658 | |||||||||||||
Conversion of LLC units to common stock (in shares) | 1,000 | |||||||||||||
Common units acquired (in shares) | 2,732,919 | |||||||||||||
Newly issued shares repurchased (in usd per share) | $ / shares | $ 40.25 | |||||||||||||
Common unit forfeiture percentage | 2.036% | |||||||||||||
Topco LLC | ||||||||||||||
Net income per Class A common share/unit: | ||||||||||||||
Common units authorized (in shares) | 253,916,941 | |||||||||||||
Common units issued (in shares) | 253,916,941 | |||||||||||||
Common units outstanding (in shares) | 253,916,941 | |||||||||||||
Distribution | $ | $ 8,200 | $ 88,600 | 96,700 | |||||||||||
Blocker Mergers | ||||||||||||||
Net income per Class A common share/unit: | ||||||||||||||
Common units outstanding (in shares) | 37,119,801 | |||||||||||||
Topco LLC | ||||||||||||||
Net income per Class A common share/unit: | ||||||||||||||
Previously issued shares purchased (in shares) | 55,823,011 | |||||||||||||
Newly issued shares purchased (in shares) | 3,703,704 | |||||||||||||
Payments to noncontrolling interest | $ | $ 110,000 | $ 94,500 | ||||||||||||
Blocker Mergers | ||||||||||||||
Net income per Class A common share/unit: | ||||||||||||||
Shares issued (in shares) | 28,965,664 | |||||||||||||
Payment of cash to acquire business | $ | $ 208,100 | |||||||||||||
Common Class A | ||||||||||||||
Net income per Class A common share/unit: | ||||||||||||||
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 | 500,000,000 | 500,000,000 | 500,000,000 | |||||||||
Common stock, par value (in usd per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||
Common stock, number of votes | vote | 1 | |||||||||||||
Proceeds from issuance of common stock | $ | $ 0 | $ 0 | 1,757,245 | |||||||||||
Repurchase and retirement of Class A common from MLSH 2 (in shares) | 1,319,148 | |||||||||||||
Repurchase and retirement of Class A common from MLSH 2 | $ | $ 33,700 | |||||||||||||
Common Class B | ||||||||||||||
Net income per Class A common share/unit: | ||||||||||||||
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 | 300,000,000 | 300,000,000 | 300,000,000 | |||||||||
Common stock, par value (in usd per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||
Common stock, number of votes | vote | 1 | |||||||||||||
Proceeds from issuance of common stock | $ | $ 1,700 | $ 0 | $ 0 | $ 1,687 | ||||||||||
Issuance of shares (in shares) | 168,654,981 | |||||||||||||
IPO | ||||||||||||||
Net income per Class A common share/unit: | ||||||||||||||
Issuance of stock (in shares) | 69,000,000 | |||||||||||||
Stock issued price (in usd per share) | $ / shares | $ 27 | |||||||||||||
Proceeds from issuance of stock | $ | $ 1,800,000 | |||||||||||||
Offering cost payments | $ | $ 108,571 | |||||||||||||
Over-Allotment Option | ||||||||||||||
Net income per Class A common share/unit: | ||||||||||||||
Issuance of stock (in shares) | 2,700,000 | |||||||||||||
Stock issued price (in usd per share) | $ / shares | $ 50 | $ 31.25 | ||||||||||||
Over-Allotment Option | Common Class A | ||||||||||||||
Net income per Class A common share/unit: | ||||||||||||||
Issuance of stock (in shares) | 9,000,000 | |||||||||||||
Secondary Offering | ||||||||||||||
Net income per Class A common share/unit: | ||||||||||||||
Issuance of stock (in shares) | 20,000,000 | 20,700,000 | ||||||||||||
Conversion of LLC units to common stock (in shares) | 17,068,559 | 17,665,959 | ||||||||||||
Offering cost payments | $ | $ 900 | $ 1,000 | ||||||||||||
Secondary Offering | MLSH 1 | ||||||||||||||
Net income per Class A common share/unit: | ||||||||||||||
Proceeds from issuance of stock | $ | $ 977,500 | $ 624,200 | ||||||||||||
Secondary Offering By MLSH 2 | ||||||||||||||
Net income per Class A common share/unit: | ||||||||||||||
Issuance of stock (in shares) | 2,931,441 | 3,034,041 |
Net Income Per Class A Common_3
Net Income Per Class A Common Share/Unit Attributable to Maravai LifeSciences Holdings, Inc. - Narrative (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |
Nov. 30, 2020 | Dec. 31, 2022 | Dec. 31, 2020 | |
Net income per Class A common share/unit: | |||
Preferred units annual cumulative dividend | 8% | ||
Preferred units additional annual dividend | 4% | ||
Conversion of LLC units to common stock (in shares) | 1,000 | ||
IPO | |||
Net income per Class A common share/unit: | |||
Issuance of stock (in shares) | 69,000,000 | ||
Sale and Rollover Agreement | |||
Net income per Class A common share/unit: | |||
Conversion of LLC units to common stock (in shares) | 69,599 | ||
Dividends | $ 10.2 |
Net Income Per Class A Common_4
Net Income Per Class A Common Share/Unit Attributable to Maravai LifeSciences Holdings, Inc. - Summary of Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |||
Nov. 20, 2020 | Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Numerator: | ||||||
Net income | $ (20,831) | $ 11,431 | $ 88,216 | $ 490,663 | $ 469,250 | $ 78,816 |
Less: preferred unit dividends attributable to the MLSC non-controlling interests | 0 | 0 | (15,270) | |||
Less: (income) loss attributable to common non-controlling interests | (270,458) | (287,213) | 13,342 | |||
Net income attributable to Maravai LifeSciences Holdings, Inc.—basic | 220,205 | 182,037 | 76,888 | |||
Net income (loss) effect of dilutive securities: | ||||||
Effect of dilutive employee stock purchase plan, RSUs and options | 87 | 132 | 0 | |||
Effect of the assumed conversion of Class B common stock | 205,984 | 220,187 | (8,802) | |||
Net income attributable to Maravai LifeSciences Holdings, Inc.—diluted | $ 426,276 | $ 402,356 | $ 68,086 | |||
Denominator: | ||||||
Weighted average Class A common shares/units outstanding—basic | 131,545 | 114,791 | 10,351 | |||
Weighted average effect of dilutive securities: | ||||||
Effect of dilutive employee stock purchase plan, RSUs and options | 109 | 153 | 1 | |||
Effect of the assumed conversion of Class B common stock | 123,669 | 142,859 | 18,556 | |||
Weighted average Class A common shares/units outstanding—diluted | 255,323 | 257,803 | 28,908 | |||
Net income per Class A common share - basic (in usd per share) | $ 1.67 | $ 1.59 | $ 7.43 | |||
Net income per Class A common share - diluted (in usd per share) | $ 1.67 | $ 1.56 | $ 2.36 |
Net Income Per Class A Common_5
Net Income Per Class A Common Share/Unit Attributable to Maravai LifeSciences Holdings, Inc. - Summary of Dilutive Securities Excluded (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Potentially dilutive securities excluded from computation of net income per share (in shares) | 2,856 | 367 | 1,586 |
Restricted stock units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Potentially dilutive securities excluded from computation of net income per share (in shares) | 74 | 0 | 0 |
Stock options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Potentially dilutive securities excluded from computation of net income per share (in shares) | 2,769 | 355 | 1,535 |
Shares estimated to be purchased under employee stock purchase plan | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Potentially dilutive securities excluded from computation of net income per share (in shares) | 13 | 12 | 51 |
Equity Incentive Plans - Narrat
Equity Incentive Plans - Narrative (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Nov. 30, 2020 | Oct. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Equity-based compensation | $ 18,670,000 | $ 10,458,000 | $ 24,629,000 | |||
Fair value of options vested in period | 7,700,000 | 4,300,000 | ||||
Unrecognized share-based compensation cost related to unvested stock option awards | 27,700,000 | |||||
Topco LLC | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Payments to settle repurchase agreements | $ 9,100,000 | |||||
2020 Omnibus Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Automatic annual increase period | 10 years | |||||
Automatic annual increase percentage factor | 4% | |||||
Award term | 10 years | |||||
Standard exercise price percentage | 100% | |||||
Exercise price percentage for holders of 10% of stock | 110% | |||||
Employee Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Employee stock purchase period | 6 months | |||||
Discount from market price on offering date | 15% | |||||
Discount from market price on purchase date | 15% | |||||
Performance Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Equity-based compensation | 0 | 0 | 0 | |||
Stock options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Equity-based compensation | $ 8,100,000 | $ 4,600,000 | $ 600,000 | |||
Expected dividend yield | 0% | 0% | 0% | |||
Expected period for recognition | 3 years | |||||
Restricted stock units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Equity-based compensation | $ 8,200,000 | $ 800,000 | $ 100,000 | |||
Expected period for recognition | 2 years 4 months 24 days | |||||
Fair value of shares vested in period | $ 1,000,000 | $ 900,000 | ||||
Unrecognized share-based compensation cost related to unvested incentive units and restricted stock units | $ 25,700,000 | |||||
Outstanding (in shares) | 1,331,000 | 90,000 | ||||
MLSC Incentive Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Equity-based compensation | $ 800,000 | 1,500,000 | ||||
Fair value of shares vested in period | 900,000 | |||||
MLSC Incentive Units | President | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Outstanding (in shares) | 1,500,000 | |||||
MLSH 1 Incentive Unit | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Equity-based compensation | $ 700,000 | $ 3,900,000 | 22,300,000 | |||
Expected period for recognition | 1 year 7 months 6 days | |||||
Unrecognized share-based compensation cost related to unvested incentive units and restricted stock units | $ 500,000 | |||||
Outstanding (in shares) | 77,000 | 159,000 | ||||
Incremental equity based compensation expense | $ 16,700,000 | |||||
Accelerated expense | $ 2,400,000 | |||||
MLSH 1 Incentive Unit | Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award term | 4 years | |||||
MLSH 1 Incentive Unit | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award term | 5 years | |||||
MLSH 1 Incentive Unit, With Performance Condition Vesting | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Equity-based compensation | $ 3,500,000 |
Equity Incentive Plans - Summar
Equity Incentive Plans - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Number of Stock Options | ||
Beginning balance outstanding (in shares) | 1,409 | |
Granted (in shares) | 1,709 | |
Exercised (in shares) | (4) | |
Cancelled (in shares) | (221) | |
Ending balance outstanding (in shares) | 2,893 | 1,409 |
Exercisable (in shares) | 726 | |
Weighted Average Exercise Price per Stock Option | ||
Beginning balance outstanding (in usd per share) | $ 30.47 | |
Granted (in usd per share) | 23.81 | |
Exercised (in usd per share) | 26.08 | |
Cancelled (in usd per share) | 31.64 | |
Ending balance outstanding (in usd per share) | 26.45 | $ 30.47 |
Exercisable (in usd per share) | $ 28.75 | |
Stock Options Additional Disclosures | ||
Weighted average remaining contractual life | 8 years 10 months 24 days | 9 years |
Exercisable weighted average exercise price per stock option | 8 years 2 months 12 days | |
Aggregate intrinsic value, outstanding | $ 0 | $ 16,846 |
Exercisable aggregate intrinsic value | $ 0 |
Equity Incentive Plans - Summ_2
Equity Incentive Plans - Summary of Stock Option Valuation Assumptions (Details) - Stock options | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 51.30% | 57.20% | 59% |
Risk-free interest rate | 2.80% | 1% | 0.50% |
Expected term (in years) | 6 years 1 month 6 days | 6 years 1 month 6 days | 6 years 1 month 6 days |
Expected dividend yield | 0% | 0% | 0% |
Equity Incentive Plans - Summ_3
Equity Incentive Plans - Summary of Restricted Stock Activity (Details) - Restricted stock units shares in Thousands | 12 Months Ended |
Dec. 31, 2022 $ / shares shares | |
Restricted Stock Units (in thousands) | |
Beginning balance (in shares) | shares | 90 |
Granted (in shares) | shares | 1,375 |
Vested (in shares) | shares | (69) |
Forfeited (in shares) | shares | (65) |
Ending balance (in shares) | shares | 1,331 |
Weighted Average Fair Value per RSU at Grant Date | |
Beginning balance (in usd per share) | $ / shares | $ 31.96 |
Granted (in usd per share) | $ / shares | 23.99 |
Vested (in usd per share) | $ / shares | 33.25 |
Forfeited (in usd per share) | $ / shares | 27.30 |
Ending balance (in usd per share) | $ / shares | $ 21.04 |
Equity Incentive Plans - Summ_4
Equity Incentive Plans - Summary of Incentive Unit Activity (Details) - MLSH 1 Incentive Unit shares in Thousands | 12 Months Ended |
Dec. 31, 2022 $ / shares shares | |
Restricted Stock Units (in thousands) | |
Beginning balance (in shares) | shares | 159 |
Forfeited (in shares) | shares | (6) |
Vested (in shares) | shares | (76) |
Ending balance (in shares) | shares | 77 |
Weighted Average Fair Value per RSU at Grant Date | |
Beginning balance (in usd per share) | $ / shares | $ 22.20 |
Forfeited (in usd per share) | $ / shares | 17.44 |
Vested (in usd per share) | $ / shares | 20.39 |
Ending balance (in usd per share) | $ / shares | $ 24.34 |
Equity Incentive Plans - Stock-
Equity Incentive Plans - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total equity-based compensation | $ 18,670 | $ 10,458 | $ 24,629 |
Cost of sales | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total equity-based compensation | 4,192 | 1,915 | 282 |
Selling, general and administrative | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total equity-based compensation | 13,349 | 8,263 | 24,216 |
Research and development | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total equity-based compensation | $ 1,129 | $ 280 | $ 131 |
Repurchase of Non-Controlling_2
Repurchase of Non-Controlling Interests - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | ||
Nov. 30, 2020 | Oct. 31, 2020 | Sep. 30, 2020 | Nov. 19, 2020 | |
Noncontrolling Interest [Line Items] | ||||
Purchase of noncontrolling interest in MLSC | $ 166,427 | |||
Conversion of LLC units to common stock (in shares) | 1,000 | |||
Non-controlling Interest | ||||
Noncontrolling Interest [Line Items] | ||||
Purchase of noncontrolling interest in MLSC | 4,812 | |||
Member’s Equity | ||||
Noncontrolling Interest [Line Items] | ||||
Purchase of noncontrolling interest in MLSC | $ 161,615 | |||
Topco LLC And MLSH 1 | Investors | ||||
Noncontrolling Interest [Line Items] | ||||
Value of shares purchased in noncontrolling interest | $ 120,000 | |||
Topco LLC | ||||
Noncontrolling Interest [Line Items] | ||||
Payments for repurchase of shares | $ 120,000 | |||
Common units outstanding (in shares) | 253,916,941 | |||
Investors | ||||
Noncontrolling Interest [Line Items] | ||||
Preferred units outstanding (in shares) | 16,736 | |||
Common units outstanding (in shares) | 7,112,794 | |||
Value of stock converted in period | $ 46,600 | |||
Preferred Class B | Topco LLC And MLSH 1 | Investors | ||||
Noncontrolling Interest [Line Items] | ||||
Shares purchased in noncontrolling interest (in shares) | 43,264 | |||
Common Units | Topco LLC And MLSH 1 | Investors | ||||
Noncontrolling Interest [Line Items] | ||||
Shares purchased in noncontrolling interest (in shares) | 18,387,206 |
Income Taxes - Summary of Incom
Income Taxes - Summary of Income (Loss) Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
U.S. | $ 551,472 | $ 530,853 | $ 82,012 |
International | 0 | (88) | (316) |
Income before income taxes | $ 551,472 | $ 530,765 | $ 81,696 |
Income Taxes - Summary of Inc_2
Income Taxes - Summary of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current tax expense | |||
Federal | $ 16,312 | $ 9,291 | $ 6,093 |
State and local | 2,173 | 1,623 | 2,251 |
International | 6 | 3,697 | 0 |
Total current tax expense | 18,491 | 14,611 | 8,344 |
Deferred tax expense (benefit) | |||
Federal | 39,924 | 36,564 | (3,922) |
State and local | 2,394 | 10,340 | (1,542) |
Total deferred tax expense (benefit) | 42,318 | 46,904 | (5,464) |
Total provision for income taxes | $ 60,809 | $ 61,515 | $ 2,880 |
Income Taxes - Summary of Inc_3
Income Taxes - Summary of Income Tax Rate Reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Federal statutory rate | 21% | 21% | 21% |
State and local taxes, net of federal benefits | 0.60% | 2.20% | 0.30% |
Deferred tax revaluation | 0.30% | 0% | (1.80%) |
Income of non-controlling interest | (10.30%) | (11.40%) | (18.90%) |
Taxable (loss) gain on subsidiary liquidation | 0% | (0.70%) | 2.70% |
Equity-based compensation | 0% | 0.10% | 1.30% |
Research and development credits | (0.10%) | (0.40%) | (0.10%) |
Valuation allowance | 0.10% | 0.10% | (1.50%) |
Other | (0.60%) | 0.70% | 0.50% |
Effective tax rate | 11% | 11.60% | 3.50% |
Income Taxes - Summary of Defer
Income Taxes - Summary of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets | ||
Investment in Topco LLC | $ 636,498 | $ 675,855 |
Deductions to be received for the Tax Receivable Agreement payments | 148,681 | 154,093 |
Capital loss carryforward | 3,265 | 0 |
Other | 1,131 | 1,249 |
Total deferred tax assets | 789,575 | 831,197 |
Valuation allowance | (23,776) | (23,080) |
Total deferred tax assets, net of valuation allowance | $ 765,799 | $ 808,117 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Examination [Line Items] | ||||
Deferred tax assets | $ 789,575,000 | $ 831,197,000 | ||
Capital loss carryforward | 3,265,000 | 0 | ||
Deferred tax assets, valuation allowance | 23,776,000 | 23,080,000 | ||
Increase (decrease) in valuation allowance | 700,000 | 9,400,000 | ||
Unrecognized tax benefits | 6,257,000 | 241,000 | $ 220,000 | $ 208,000 |
Expected decrease to unrecognized tax benefits due to statue expiration | 1,900,000 | |||
Interest related to uncertain tax benefits | $ 1,000,000 | |||
Percentage of tax benefits paid | 85% | |||
Gain (loss) on tax receivable agreement | $ (4,102,000) | 6,101,000 | 0 | |
Assumed income tax rate | 46.70% | |||
Assumed income tax rate when business income deduction is unavailable | 54.10% | |||
Tax distribution payable | $ 0 | |||
Affiliated Entity | Tax Receivable Agreement, Payments | ||||
Income Tax Examination [Line Items] | ||||
Related party transaction amounts | 0 | |||
Tax Distribution | Topco LLC | ||||
Income Tax Examination [Line Items] | ||||
Tax distributions paid | 310,000,000 | 283,200,000 | 13,100,000 | |
Topco LLC | ||||
Income Tax Examination [Line Items] | ||||
Deferred tax assets | 765,800,000 | |||
Temporary book basis difference | 636,500,000 | |||
Future tax benefit deductions | 148,700,000 | |||
Capital loss carryforward | 3,300,000 | |||
Deferred tax assets, valuation allowance | 23,800,000 | |||
MLSH1 and MLSH 2 | Affiliated Entity | Tax Receivable Agreement, Payments | ||||
Income Tax Examination [Line Items] | ||||
Liability payable to related party | 718,200,000 | 748,300,000 | ||
Gain (loss) on tax receivable agreement | (4,100,000) | |||
Related party transaction amounts | 35,300,000 | 1,300,000 | ||
MLSH1 and MLSH 2 | Affiliated Entity | Interest Payments | ||||
Income Tax Examination [Line Items] | ||||
Related party transaction amounts | 1,100,000 | |||
Maravai LifeSciences Holdings, Inc | Tax Distribution | Topco LLC | ||||
Income Tax Examination [Line Items] | ||||
Tax distributions paid | $ 159,800,000 | $ 129,700,000 | $ 4,900,000 |
Income Taxes - Summary of Loss
Income Taxes - Summary of Loss and Tax Credit Carryforwards (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Operating Loss Carryforwards [Line Items] | ||
Capital loss carryforward | $ 3,265 | $ 0 |
State | ||
Operating Loss Carryforwards [Line Items] | ||
Tax credits | $ 100 |
Income Taxes - Summary of Unrec
Income Taxes - Summary of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance, beginning of year | $ 241 | $ 220 | $ 208 |
Gross increases based on tax positions related to current year | 130 | 232 | 62 |
Gross increases based on tax positions related to prior years | 6,775 | 0 | 0 |
Gross decreases based on tax positions related to prior years | (889) | (211) | (50) |
Balance, end of year | $ 6,257 | $ 241 | $ 220 |
Employee Benefit Plans - Narrat
Employee Benefit Plans - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |||
Employers matching contribution percentage | 50% | ||
Percentage of gross pay matched | 6% | ||
Employers contribution costs | $ 1.6 | $ 1.3 | $ 1 |
Related Party Transactions (Det
Related Party Transactions (Details) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |||||||
Nov. 30, 2022 | Dec. 31, 2020 USD ($) | Dec. 31, 2020 USD ($) | Nov. 30, 2020 director | Oct. 31, 2020 USD ($) | Aug. 31, 2018 USD ($) | Nov. 19, 2020 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Related Party Transaction [Line Items] | ||||||||||
Stock conversion ratio | 1 | 1 | ||||||||
Distribution | $ 8,171 | $ 52,000 | $ 88,880 | $ 150,065 | $ 153,492 | |||||
Topco LLC | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Distribution | $ 8,200 | $ 88,600 | $ 96,700 | |||||||
Non-controlling Interest | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Distribution | $ 8,171 | $ 88,600 | $ 150,206 | 153,451 | ||||||
Non-controlling Interest | Topco LLC | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Distribution | 153,500 | 8,200 | ||||||||
GTCR | Advisory Services Agreement, Placement Fee | Affiliated Entity | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Placement fee percentage | 1% | |||||||||
Related party expense | 3,700 | |||||||||
GTCR | Advisory Services Agreement, Management Fees | Affiliated Entity | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Related party costs | $ 4,200 | |||||||||
GTCR | Director Nomination Agreement | Affiliated Entity | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Termination percentage of shares | 5% | |||||||||
GTCR | Director Nomination Agreement | Affiliated Entity | 100% of Directors | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Percentage of total directors threshold | 100% | |||||||||
Percentage of shares threshold | 40% | |||||||||
GTCR | Director Nomination Agreement | Affiliated Entity | 40% of Directors | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Percentage of total directors threshold | 40% | |||||||||
GTCR | Director Nomination Agreement | Affiliated Entity | 40% of Directors | Minimum | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Percentage of shares threshold | 30% | |||||||||
GTCR | Director Nomination Agreement | Affiliated Entity | 40% of Directors | Maximum | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Percentage of shares threshold | 40% | |||||||||
GTCR | Director Nomination Agreement | Affiliated Entity | 30% of Directors | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Percentage of total directors threshold | 30% | |||||||||
GTCR | Director Nomination Agreement | Affiliated Entity | 30% of Directors | Minimum | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Percentage of shares threshold | 20% | |||||||||
GTCR | Director Nomination Agreement | Affiliated Entity | 30% of Directors | Maximum | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Percentage of shares threshold | 30% | |||||||||
GTCR | Director Nomination Agreement | Affiliated Entity | 20% of Directors | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Percentage of total directors threshold | 20% | |||||||||
GTCR | Director Nomination Agreement | Affiliated Entity | 20% of Directors | Minimum | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Percentage of shares threshold | 10% | |||||||||
GTCR | Director Nomination Agreement | Affiliated Entity | 20% of Directors | Maximum | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Percentage of shares threshold | 20% | |||||||||
GTCR | Director Nomination Agreement | Affiliated Entity | One Director | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Number of directors | director | 1 | |||||||||
GTCR | Director Nomination Agreement | Affiliated Entity | One Director | Minimum | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Percentage of shares threshold | 5% | |||||||||
Curia | Consulting Services | Affiliated Entity | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Related party expense | $ 0 | 7,400 | ||||||||
Maravai LifeSciences Foundation | Charitable Foundation Contribution | Affiliated Entity | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Related party expense | $ 2,000 |
Segments - Narrative (Details)
Segments - Narrative (Details) | 12 Months Ended | ||
Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) segment | Dec. 31, 2020 USD ($) | |
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Number of reportable segments | segment | 2 | 3 | |
Revenue | $ (883,001,000) | $ (799,240,000) | $ (284,098,000) |
Intersegment eliminations | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenue | 7,000 | 656,000 | 1,277,000 |
Commission expense | $ 0 | $ 0 | $ 0 |
Segments - Reconciliation of Re
Segments - Reconciliation of Revenue and Adjusted EBITDA to Net Loss (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |||
Nov. 20, 2020 | Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||
Revenue | $ 883,001 | $ 799,240 | $ 284,098 | |||
Amortization | (24,269) | (18,339) | (20,320) | |||
Depreciation | (7,566) | (6,413) | (5,593) | |||
Interest expense | (20,414) | (30,260) | (30,740) | |||
Interest income | 2,338 | 0 | 0 | |||
Corporate costs, net of eliminations | (55,378) | (43,265) | (18,398) | |||
Other adjustments: | ||||||
Acquisition contingent consideration | 7,800 | 0 | 0 | |||
Acquisition integration costs | (13,362) | (44) | (3,857) | |||
Acquired in-process research and development costs | 0 | 0 | (2,881) | |||
Equity-based compensation | (18,670) | (10,458) | (24,629) | |||
GTCR management fees | 0 | 0 | (680) | |||
Gain on sale of business | 0 | 11,249 | 0 | |||
Gain on sale and leaseback transaction | 19,002 | |||||
Merger and acquisition related expenses | (2,416) | (1,508) | (395) | |||
Financing costs | (1,078) | (2,383) | (9,784) | |||
Acquisition related tax adjustment | (349) | 0 | 0 | |||
Tax Receivable Agreement liability adjustment | (4,102) | 6,101 | 0 | |||
Chief Executive Officer transition costs | (2,426) | 0 | 0 | |||
Other | (1,814) | 0 | (7,592) | |||
Income before income taxes | 551,472 | 530,765 | 81,696 | |||
Income tax expense | (60,809) | (61,515) | (2,880) | |||
Net income | $ (20,831) | $ 11,431 | $ 88,216 | 490,663 | 469,250 | 78,816 |
Nucleic Acid Production | ||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||
Revenue | 813,069 | 711,864 | 206,320 | |||
Biologics Safety Testing | ||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||
Revenue | 69,932 | 68,417 | 54,897 | |||
Protein Detection | ||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||
Revenue | 18,959 | 22,881 | ||||
Operating Segments | ||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||
Revenue | 883,008 | 799,896 | 285,375 | |||
Segment adjusted EBITDA: | 693,178 | 626,085 | 187,563 | |||
Operating Segments | Nucleic Acid Production | ||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||
Revenue | 813,076 | 712,520 | 207,597 | |||
Segment adjusted EBITDA: | 638,337 | 565,254 | 133,822 | |||
Operating Segments | Biologics Safety Testing | ||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||
Revenue | 69,932 | 68,417 | 54,897 | |||
Segment adjusted EBITDA: | 54,841 | 54,440 | 44,516 | |||
Operating Segments | Protein Detection | ||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||
Revenue | 0 | 18,959 | 22,881 | |||
Segment adjusted EBITDA: | 0 | 6,391 | 9,225 | |||
Intersegment eliminations | ||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||
Revenue | $ (7) | $ (656) | $ (1,277) |
Subsequent Events - Narrative (
Subsequent Events - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | ||
Jan. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Subsequent Event [Line Items] | |||
Contingent consideration | $ 0 | $ 0 | |
Subsequent Event | Alphazyme | |||
Subsequent Event [Line Items] | |||
Payment of cash to acquire business | $ 70,000 | ||
Contingent consideration | $ 75,000 |
Uncategorized Items - mrvi-2022
Label | Element | Value |
Adjustments to Additional Paid in Capital, Tax Receivable Agreement Impact | mrvi_AdjustmentsToAdditionalPaidInCapitalTaxReceivableAgreementImpact | $ 42,776,000 |
Noncontrolling Interest, Increase from Sale of Parent Equity Interest | us-gaap_NoncontrollingInterestIncreaseFromSaleOfParentEquityInterest | 0 |
APIC, Share-Based Payment Arrangement, Increase for Cost Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 20,387,000 |
APIC, Share-Based Payment Arrangement, Increase for Cost Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 966,000 |
Stock Issued During Period, Value, New Issues | us-gaap_StockIssuedDuringPeriodValueNewIssues | 1,754,432,000 |
Limited Liability Company (LLC) Members' Equity, Unit-Based Payment Arrangement | us-gaap_LimitedLiabilityCompanyLLCMembersEquityUnitBasedCompensation | 3,276,000 |
Stock Repurchased During Period, Value | us-gaap_StockRepurchasedDuringPeriodValue | 9,140,000 |
Noncontrolling Interest, Decrease From Purchase Of Preexisting Units | mrvi_NoncontrollingInterestDecreaseFromPurchaseOfPreexistingUnits | 1,424,327,000 |
Organizational Transactions [Member] | ||
Effects Of Organizational Transactions, Value | mrvi_EffectsOfOrganizationalTransactionsValue | (159,946,000) |
Retained Earnings [Member] | ||
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | us-gaap_ProfitLoss | (3,044,000) |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | us-gaap_ProfitLoss | 3,898,000 |
AOCI Attributable to Parent [Member] | ||
Noncontrolling Interest, Increase from Sale of Parent Equity Interest | us-gaap_NoncontrollingInterestIncreaseFromSaleOfParentEquityInterest | (1,000) |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | us-gaap_OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax | 6,000 |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | us-gaap_OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax | (1,000) |
Noncontrolling Interest, Decrease From Purchase Of Preexisting Units | mrvi_NoncontrollingInterestDecreaseFromPurchaseOfPreexistingUnits | 29,000 |
AOCI Attributable to Parent [Member] | Organizational Transactions [Member] | ||
Effects Of Organizational Transactions, Value | mrvi_EffectsOfOrganizationalTransactionsValue | 114,000 |
Additional Paid-in Capital [Member] | ||
Adjustments to Additional Paid in Capital, Tax Receivable Agreement Impact | mrvi_AdjustmentsToAdditionalPaidInCapitalTaxReceivableAgreementImpact | 42,776,000 |
Stock Repurchased and Retired During Period, Value | us-gaap_StockRepurchasedAndRetiredDuringPeriodValue | 33,645,000 |
Noncontrolling Interest, Increase from Sale of Parent Equity Interest | us-gaap_NoncontrollingInterestIncreaseFromSaleOfParentEquityInterest | (58,940,000) |
APIC, Share-Based Payment Arrangement, Increase for Cost Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 2,980,000 |
APIC, Share-Based Payment Arrangement, Increase for Cost Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 362,000 |
Stock Issued During Period, Value, New Issues | us-gaap_StockIssuedDuringPeriodValueNewIssues | 1,753,742,000 |
Noncontrolling Interest, Decrease From Purchase Of Preexisting Units | mrvi_NoncontrollingInterestDecreaseFromPurchaseOfPreexistingUnits | 1,421,760,000 |
Additional Paid-in Capital [Member] | Organizational Transactions [Member] | ||
Effects Of Organizational Transactions, Value | mrvi_EffectsOfOrganizationalTransactionsValue | (200,390,000) |
Member Units [Member] | ||
Limited Liability Company (LLC) Members' Equity, Unit-Based Payment Arrangement | us-gaap_LimitedLiabilityCompanyLLCMembersEquityUnitBasedCompensation | 1,793,000 |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | us-gaap_ProfitLoss | 88,118,000 |
Stock Repurchased During Period, Value | us-gaap_StockRepurchasedDuringPeriodValue | 9,140,000 |
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders | us-gaap_MinorityInterestDecreaseFromDistributionsToNoncontrollingInterestHolders | 88,880,000 |
Member Units [Member] | Organizational Transactions [Member] | ||
Effects Of Organizational Transactions, Value | mrvi_EffectsOfOrganizationalTransactionsValue | 28,195,000 |
Noncontrolling Interest [Member] | ||
Noncontrolling Interest, Increase from Sale of Parent Equity Interest | us-gaap_NoncontrollingInterestIncreaseFromSaleOfParentEquityInterest | 58,941,000 |
APIC, Share-Based Payment Arrangement, Increase for Cost Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 17,407,000 |
APIC, Share-Based Payment Arrangement, Increase for Cost Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 604,000 |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | us-gaap_OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax | 10,000 |
Limited Liability Company (LLC) Members' Equity, Unit-Based Payment Arrangement | us-gaap_LimitedLiabilityCompanyLLCMembersEquityUnitBasedCompensation | 1,483,000 |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | us-gaap_ProfitLoss | (17,787,000) |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | us-gaap_ProfitLoss | 98,000 |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | us-gaap_ProfitLoss | 7,533,000 |
Noncontrolling Interest, Decrease From Purchase Of Preexisting Units | mrvi_NoncontrollingInterestDecreaseFromPurchaseOfPreexistingUnits | 2,538,000 |
Noncontrolling Interest [Member] | Organizational Transactions [Member] | ||
Effects Of Organizational Transactions, Value | mrvi_EffectsOfOrganizationalTransactionsValue | $ 10,236,000 |
Common Class B [Member] | Common Stock [Member] | Organizational Transactions [Member] | ||
Effects Of Organizational Transactions, Shares | mrvi_EffectsOfOrganizationalTransactionsShares | 160,974,000 |
Effects Of Organizational Transactions, Value | mrvi_EffectsOfOrganizationalTransactionsValue | $ 1,610,000 |
Common Class A [Member] | Common Stock [Member] | ||
Stock Repurchased and Retired During Period, Value | us-gaap_StockRepurchasedAndRetiredDuringPeriodValue | 13,000 |
Stock Issued During Period, Value, New Issues | us-gaap_StockIssuedDuringPeriodValueNewIssues | $ 690,000 |
Stock Issued During Period, Shares, New Issues | us-gaap_StockIssuedDuringPeriodSharesNewIssues | 69,000,000 |
Stock Repurchased and Retired During Period, Shares | us-gaap_StockRepurchasedAndRetiredDuringPeriodShares | 1,319,000 |
Common Class A [Member] | Common Stock [Member] | Organizational Transactions [Member] | ||
Effects Of Organizational Transactions, Shares | mrvi_EffectsOfOrganizationalTransactionsShares | 28,966,000 |
Effects Of Organizational Transactions, Value | mrvi_EffectsOfOrganizationalTransactionsValue | $ 289,000 |