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What changed in NEOGENOMICS INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of NEOGENOMICS INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+407 added−386 removedSource: 10-K (2026-02-17) vs 10-K (2025-02-18)

Top changes in NEOGENOMICS INC's 2025 10-K

407 paragraphs added · 386 removed · 290 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

88 edited+18 added−30 removed98 unchanged
Biggest changeBased on medical and scientific discoveries from the last decade, cancer testing is categorized into three types: diagnostic testing, prognostic testing, and predictive testing. Among these, predictive testing is the fastest-growing area, which clinicians use to anticipate which treatment options a patient is most likely to benefit from, delivering “personalized” or “precision medicine” tailored to that patient's needs.
Biggest changeAmong these, predictive testing is the fastest-growing area, which clinicians use to anticipate which treatment options a patient is most likely to benefit from, delivering “personalized” or “precision medicine” tailored to that patient's needs. Personalized or precision medicine enables clinicians to determine if a patient will respond to specific cancer medications such as Herceptin®, Keytruda®, PIQRAY®, and Opdivo®, among others.
Besides the direct benefits to patients, the precision medicine approach allows the healthcare system to save money by ensuring that expensive cancer drugs are given to those most likely to benefit from them. This type of testing enhances patient care and potentially saves lives by identifying optimized therapies much more rapidly than was possible in previous years.
Besides the direct benefits to patients, the precision medicine approach allows the healthcare system to save money by ensuring that expensive cancer drugs are given to those most likely to benefit from them. This type of testing enhances patient care and potentially saves lives by identifying optimized therapies more rapidly than was possible in previous years.
Therapy selection (molecular) testing requires highly specialized equipment and credentialed individuals (typically MD or PhD level) to certify results. It usually yields the highest reimbursement levels of the three market segments. Minimal Residual Disease testing measures blood or bone marrow to evaluate the amount of cancer cells left after treatment.
Therapy selection (molecular) testing requires highly specialized equipment and credentialed individuals (typically MD or PhD level) to certify results. It usually yields the highest reimbursement levels of the three market segments. Molecular Residual Disease testing measures blood or bone marrow to evaluate the amount of cancer cells left after treatment.
Additionally, we offer a full range of sequencing testing including whole exome and whole genome sequencing as part of our pharmaceutical development services. National Direct Sales Force Our direct sales force has been trained extensively in cancer genetic testing and consultative selling skills to service the needs of clients.
Additionally, we offer a full range of sequencing testing, including whole exome sequencing as part of our pharmaceutical development services. National Direct Sales Force Our direct sales force has been trained extensively in cancer genetic testing and consultative selling skills to service the needs of clients.
Our program employs a risk-based approach to the development and implementation of standards of conduct, training and education of employees, monitoring and auditing Company practices, investigation, and response to reported or detected compliance issues.
Our program employs a risk review-based approach to the development and implementation of standards of conduct, training and education of employees, monitoring and auditing Company practices, investigation, and response to reported or detected compliance issues.
The Company provides a hotline for employees who wish to anonymously or confidentially report suspected violations of our codes of conduct, policies and procedures, or laws and regulations. Employees are strongly encouraged to report suspected violations.
The Company provides a hotline for any employees who wish to anonymously or confidentially report suspected violations of our codes of conduct, policies and procedures, or laws and regulations. Employees are strongly encouraged to report suspected violations.
Risk Factors,” including the risk factors entitled “Risks Relating to Government Regulation and Reimbursement.” Licensure, Accreditation, and Quality Standards The Company operates laboratories domestically in Arizona, California, Florida, Georgia, Illinois, North Carolina, Tennessee, and Texas, and internationally in the United Kingdom. The laboratories are licensed as required by the states or countries in which they are located.
Risk Factors,” including the risk factors entitled “Risks Relating to Government Regulation and Reimbursement.” Licensure, Accreditation, and Quality Standards The Company operates laboratories domestically in Arizona, California, Florida, Georgia, Illinois, New Jersey, North Carolina, Tennessee, and Texas, and internationally in the United Kingdom. The laboratories are licensed as required by the states or countries in which they are located.
Typically performed on liquid samples such as peripheral blood and bone marrow aspirate, it may also be performed on solid tissue samples such as lymph nodes following additional processing steps. Cells are labeled with selective fluorescent antibodies and analyzed as they flow in a fluid stream through a beam of light.
Typically performed on liquid samples such as peripheral blood and bone marrow aspirate, it may also be performed on solid tissue samples such as lymph nodes after additional processing steps. Cells are labeled with selective fluorescent antibodies and analyzed as they flow in a fluid stream through a beam of light.
The State of New York is one state that requires licensure of nonresident laboratories that perform tests on specimens from patients who live in New York, and our laboratories in Fort Myers, Florida; Aliso Viejo and Carlsbad, California; Nashville, Tennessee; and Houston, Texas therefore are licensed by the State of New York.
The State of New York is one state that requires licensure of nonresident laboratories that perform tests on specimens from patients who live in New York, and our laboratories in Fort Myers, Florida; Aliso Viejo and Carlsbad, California; Nashville, Tennessee; Ramsey, New Jersey; and Houston, Texas therefore are licensed by the State of New York.
Similar laws continued to be proposed or passed at the U.S. federal and state level, including the Texas Data Privacy and Security Act, which took effect on July 1, 2024, the Oregon Consumer Privacy Act, which took effect on July 1, 2024, the Montana Consumer Data Privacy Act, which took effect on October 1, 2024, the Delaware Personal Data Privacy Act, which took effect on January 1, 2025, the Iowa Consumer Data Protection Act, which took effect on January 1, 2025, the Nebraska Data Privacy Act, which took effect on January 1, 2025, the New Hampshire Privacy Act, which took effect on January 1, 2025 and the New Jersey Data Privacy Act, which took effect on January 15, 2025.
Similar laws continued to be proposed or passed at the U.S. federal and state level, including the Texas Data Privacy and Security Act, which took effect on July 1, 2024, the Oregon Consumer Privacy Act, which took effect on July 1, 2024, the Montana Consumer Data Privacy Act, which took effect on October 1, 2024, the Delaware Personal Data Privacy Act, which took effect on January 1, 2025, the Iowa Consumer Data Protection Act, which took effect on January 1, 2025, the Nebraska Data Privacy Act, which took effect on January 1, 2025, the New Hampshire Privacy Act, which took effect on January 1, 2025 and the New Jersey Data Privacy Act, which took effect on January 15, 2025, among other states.
The acquisition of Inivata in June 2021 enhanced our capabilities with oncology liquid biopsy technology including RaDaR® which is designed to detect residual disease and recurrence in plasma samples from patients with solid tumor malignancies. These molecular laboratory and NGS capabilities are expected to drive growth in the coming years.
The acquisition of Inivata in June 2021 enhanced our capabilities with oncology liquid biopsy technology including RaDaR®, which is designed to detect MRD and recurrence in plasma samples from patients with solid tumor malignancies. These molecular laboratory and NGS capabilities are expected to drive growth in the coming years.
We believe that our present insurance is sufficient to cover currently estimated exposures, but we cannot assure that we will not incur liabilities in excess of the policy coverage limits.
We believe that our present insurance is sufficient to cover currently estimated exposures, but we cannot ensure that we will not incur liabilities in excess of the policy coverage limits.
For our pharmaceutical development services, we have a dedicated team of business development specialists who are experienced in working with sponsors and helping them with the testing needs of their research and development projects as well as Phase I, II and III studies.
For our pharmaceutical development services, we have a dedicated team of business development specialists who are experienced in working with sponsors and helping them with the testing needs of their pre-clinical development projects as well as Phase I, II and III studies.
We also enter into invention disclosure and assignment agreements with our employees and consultants that obligate them to assign to us any inventions they have developed while working for us. 2025 Focus Areas: We are committed to sustainable growth while transforming cancer care for patients and providers and enabling the delivering of precision oncology into the community care setting.
We also enter into invention disclosure and assignment agreements with our employees and consultants that obligate them to assign to us any inventions they have developed while working for us. 2026 Focus Areas: We are committed to sustainable growth while transforming cancer care for patients and providers and enabling the delivery of precision oncology into the community care setting.
On May 29, 2024, the American Clinical Laboratory Association (“ACLA”) filed a lawsuit against the FDA in the United States District Court for the Eastern District of Texas, challenging the FDA's final rule. A similar lawsuit was also filed by the Association for Molecular Pathology and that case has been consolidated with the ACLA action. Those cases remain pending.
On May 29, 2024, the American Clinical Laboratory Association (“ACLA”) filed a lawsuit against the FDA in the United States District Court for the Eastern District of Texas, challenging the FDA's final rule. A similar lawsuit was also filed by the Association for Molecular Pathology and that case has been consolidated with the ACLA action.
It is possible that changes to FDA’s regulatory approach, whether triggered by legislation, the change in presidential administration, or otherwise, may result in increased regulatory burdens and costs for us to seek marketing authorization for and maintain ongoing compliance for our existing tests, any modifications thereto, or any future tests we may develop.
It is possible that changes to FDA’s regulatory approach, whether triggered by legislation, the current presidential administration, or otherwise, may result in increased regulatory burdens and costs for us, including requiring us to seek marketing authorization for and maintain ongoing compliance for our existing tests, any modifications thereto, or any future tests we may develop.
The Health Information Technology for Economic and Clinical Health Act (“HITECH Act”), enacted as part of the American Recovery and Reinvestment Act (“ARRA”), extended the scope of HIPAA to permit enforcement against business associates, which are entities that use PHI to provide certain services on behalf of covered entities, for HIPAA for violations.
The Health Information Technology for Economic and Clinical Health Act (“HITECH Act”), enacted as part of the American Recovery and Reinvestment Act (“ARRA”), extended the scope of HIPAA to permit enforcement against business associates, which are entities that use, access, store, or transmit PHI to provide certain services on behalf of covered entities, for HIPAA for violations.
This integration aligns with our broader service offerings to provide seamless, comprehensive support for both clinical and pharmaceutical clients. Strategic Focus By streamlining our segments, we aim to provide a seamless and integrated service offering to our clients. This approach allows us to leverage our expertise in oncology and molecular diagnostics to support both clinical and pharmaceutical clients more effectively.
This integration aligns with our broader service offerings to provide seamless, comprehensive support for both clinical and pharmaceutical clients. Strategic Focus We aim to provide a seamless and integrated service offering to our clients. Our operating approach allows us to leverage our expertise in oncology and molecular diagnostics to support both clinical and pharmaceutical clients more effectively.
For the years ended December 31, 2024, 2023 and 2022, no single client accounted for more than 10% of revenue.
For the years ended December 31, 2025, 2024 and 2023, no single client accounted for more than 10% of revenue.
The health care industry is highly regulated and scrutinized, including with respect to fraud, waste, abuse, unauthorized billing practices, and improper financial relationships between health care companies and their referral sources.
Compliance and Ethics Program The health care industry is highly regulated and scrutinized, including with respect to fraud, waste, abuse, unauthorized billing practices, and improper financial relationships between health care companies and their referral sources.
Issued U.S. patents and their international counterparts currently in our patent portfolio that relate to various aspects of our technology and products are expected to expire between 2025 and 2036. To protect our brand and identity, the “NeoGenomics”, “Genoptix”, “Clarient”, “Inivata”, and “Trapelo” company names and certain logos have been trademarked with the United States Patent and Trademark Office.
Issued U.S. patents and their international counterparts currently in our patent portfolio that relate to various aspects of our technology and products are expected to expire between 2025 and 2045. To protect our brand and identity, the “NeoGenomics” and “Inivata” company names and certain logos have been trademarked with the United States Patent and Trademark Office.
Our in-house customer care team is aligned with our field sales team to serve the needs of our clients by utilizing the same LIMS and CRM. Our field teams can see in real time when a client calls the laboratory, the reason for the call and the resolution, and determine if face-to-face interaction is needed for follow-up.
Our in-house customer care team is aligned with our field sales team to serve the needs of our clients by utilizing the same LIMS and CRM. Our field teams have transparency to see when a client calls the laboratory, the reason for the call and the resolution, and determine if face-to-face interaction is needed for follow-up.
All of our domestic laboratories are certified in accordance with the CLIA. Under CLIA, the Centers for Medicare & Medicaid Services (“CMS”) establish various operational, personnel, facilities, administration, quality, and proficiency requirements for testing performed by a laboratory, intended to ensure testing services are accurate, valid, and timely.
All of our domestic laboratories are certified in accordance with the CLIA. Under CLIA, the Centers for Medicare & Medicaid Services (“CMS”) establish various operational, personnel, facilities, administration, quality, and proficiency requirements for testing performed by a laboratory, intended to ensure testing 11 Table of Contents NEOGENOMICS, INC. services are accurate, valid, and timely.
The Office of Inspector General of the Department of Health and Human Services (“OIG”) has published compliance program guidance, including a General Compliance Program Guidance issued in November 2023 that is applicable to all health care companies and stakeholders, a specific Compliance Program Guidance for Clinical Laboratories issued in August of 1998 (which the OIG anticipates updating in 2025), fraud alerts, and advisory opinions.
The Office of Inspector General of the Department of Health and Human Services (“OIG”) has published compliance program guidance, including a General Compliance Program Guidance issued in November 2023 that is applicable to all health care companies and stakeholders, a specific Compliance Program Guidance for Clinical Laboratories issued in August of 1998, fraud alerts, and advisory opinions.
Additionally, private individuals may have a right of action against the Company for violations of a state’s privacy laws. We believe that we are in material compliance with current state laws regarding the confidentiality of health information, and we will continue to monitor and comply with new or changing state laws. 16 Table of Contents NEOGENOMICS, INC.
Additionally, private individuals may have a right of action against the Company for violations of a state’s privacy laws. We believe that we are in material compliance with current state laws regarding the confidentiality of health information, and we will continue to monitor and comply with new or changing state laws.
In addition, the volume of our testing tends to decline due to extreme adverse weather conditions, such as excessively 9 Table of Contents NEOGENOMICS, INC. hot or cold spells, heavy snow, hurricanes or tornadoes in certain regions, consequently reducing revenues and cash flows in any affected period.
In addition, the volume of our testing tends to decline due to extreme adverse weather conditions, such as excessively hot or cold spells, heavy snow, and hurricanes or tornadoes in certain regions, consequently reducing revenues and cash flows in any affected period.
Our volumes are often based on how quickly sponsors can get patient enrollees for their trials and seasonality can impact how quickly patients are enrolled. Many of our long-term contracts contain specific performance obligations where the testing is performed on a specific schedule.
Our volumes are often based on how quickly sponsors can get patient enrollees for their trials and seasonality can impact how quickly patients are enrolled. Many of our long-term contracts 9 Table of Contents NEOGENOMICS, INC. contain specific performance obligations where the testing is performed on a specific schedule.
The services provided at NeoGenomics may include primary diagnosis, in which a sample is received for processing and our pathologists provide the initial diagnosis; or 5 Table of Contents NEOGENOMICS, INC. may include secondary consultations, in which slides and/or tissue blocks are received from an outside institution for second opinion.
The services provided at NeoGenomics may include primary diagnosis, in which a sample is received for processing and our pathologists provide the initial diagnosis; or may include secondary consultations, in which slides and/or tissue blocks are received from an outside institution for second opinion.
Common molecular testing technologies include DNA fragment length analysis; polymerase chain reaction (“PCR”) analysis; reverse transcriptase polymerase chain reaction (“RT-PCR”) analysis, real-time (or quantitative) polymerase chain reaction (“qPCR”) analysis; bi-directional Sanger sequencing analysis; and next-generation sequencing (“NGS”) analysis. • Morphologic analysis – the process of analyzing cells under the microscope by a pathologist, usually for the purpose of diagnosis.
Common molecular testing technologies include DNA fragment length analysis; polymerase chain reaction (“PCR”) analysis; reverse transcriptase polymerase chain reaction (“RT-PCR”) analysis; real-time (or quantitative) polymerase chain reaction (“qPCR”) analysis; Sanger sequencing analysis; and NGS analysis. • Morphologic analysis – the process of analyzing cells under the microscope by a pathologist, usually for the purpose of diagnosis.
In addition, although we believe that we will be able to continue to obtain adequate insurance coverage, we cannot assure that we will be able to do so at an acceptable cost. Human Capital Management As of December 31, 2024, we had approximately 2,200 full-time equivalent employees including contracted pathologists.
In addition, although we believe that we will be able to continue to obtain adequate insurance coverage, we cannot be certain that we will be able to do so at an acceptable cost. Human Capital Management As of December 31, 2025, we had approximately 2,500 full-time equivalent employees including contracted pathologists.
For example, the Company utilizes standard transaction data sets, and has obtained and implemented national provider identifiers, or NPIs, as the standard unique health identifier in filing and processing health care claims and other transactions. HIPAA violations may be subject to criminal and civil penalties.
For example, the Company utilizes standard transaction data sets, and has obtained and implemented national provider identifiers, or NPIs, as the standard unique health identifier in filing and processing health care claims and other transactions. HIPAA violations may be subject to criminal and civil penalties. 15 Table of Contents NEOGENOMICS, INC.
Competition Our competitors within the broader genomics profiling space include laboratory companies such as Quest Diagnostics, Laboratory Corporation of America and Bio-Reference Laboratories. These are large national laboratories that possess greater name recognition, larger client bases, and significantly greater financial resources and employ substantially more personnel than we do.
Competition Our competitors within the broader genomics profiling space include laboratory companies such as Quest Diagnostics, Laboratory Corporation of America and ARUP. These are large national laboratories offering broad diagnostic tests that possess greater name recognition, larger client bases, and significantly greater financial resources and employ substantially more personnel than we do.
Any concerns regarding the quality of testing or services provided by the Company are quickly communicated to our Company management. We also frequently revise and improve our tests, and we work with laboratory equipment vendors to help ensure that our laboratory has the highest possible quality.
Our employees are committed to providing accurate, reliable, and consistent services. Any concerns regarding the quality of testing or services provided by the Company are quickly communicated to our Company management. We also frequently revise and improve our tests, and we work with laboratory equipment vendors to help ensure that our laboratory has the highest possible quality.
The FDA has also claimed regulatory authority over LDTs but has historically exercised enforcement discretion with regard to most LDTs offered by CLIA-certified laboratories performing high complexity tests, and has not subjected these tests to FDA rules and regulations governing medical devices, including premarket review requirements.
LDTs are subject to CMS oversight through its enforcement of CLIA. The FDA has also claimed regulatory authority over LDTs but has historically exercised enforcement discretion with regard to most LDTs offered by CLIA-certified laboratories performing high complexity tests, and has not subjected these tests to FDA rules and regulations governing medical devices, including premarket review requirements.
Given our participation in Medicare and Medicaid, we are subject to Medicare and Medicaid regulations related to billing those programs as well as agency subregulatory guidance regarding the same, the federal Stark Law, federal and state anti-kickback statutes, and the federal FCA and state equivalents. 15 Table of Contents NEOGENOMICS, INC.
Given our participation in Medicare and Medicaid, we are subject to Medicare and Medicaid regulations related to billing those programs as well as agency subregulatory guidance regarding the same, the federal Stark Law, federal and state anti-kickback statutes, and the federal FCA and state equivalents.
Congress enacted the Eliminating Kickbacks in Recovery Act of 2018 (“EKRA”), as part of the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act (“SUPPORT Act”).
Congress enacted the Eliminating Kickbacks in Recovery Act of 2018 (“EKRA”), as part of the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for 13 Table of Contents NEOGENOMICS, INC. Patients and Communities Act (“SUPPORT Act”).
Penalties for violations of these laws can be significant; for instance, GDPR’s maximum penalties are up to the greater of 4.0% of a company’s annual global turnover or €20.0 million.
Penalties 16 Table of Contents NEOGENOMICS, INC. for violations of these laws can be significant; for instance, GDPR’s maximum penalties are up to the greater of 4.0% of a company’s annual global turnover or €20.0 million.
The final rule was published on May 6, 2024. As part of that final rule, the FDA issued a policy to phase out, over the course of four years, its general enforcement discretion approach to LDTs and also issued targeted enforcement discretion policies for certain categories of LDTs.
As part of that final rule, the FDA issued a policy to phase out, over the course of four years, its general enforcement discretion approach to LDTs and also issued targeted enforcement discretion policies for certain categories of LDTs.
The U.S. market for oncology testing is divided among numerous commercial and academically affiliated laboratories. The laboratories affiliated with academic institutions primarily provide clinical services to their affiliated university hospitals and associated physicians.
The U.S. market for oncology testing is divided among numerous commercial and academically affiliated laboratories. The laboratories affiliated with academic institutions primarily provide clinical services to their affiliated university hospitals and associated physicians. 7 Table of Contents NEOGENOMICS, INC.
Government Regulation The laboratory industry is subject to extensive governmental regulation domestically, at the federal and state levels, and internationally. The applicable laws and regulations change frequently and there can be no assurance that the Company will not be subject to audit, inquiry, or investigation with respect to some aspect of its operations.
Government Regulation The laboratory industry is subject to extensive governmental regulation domestically, at both the federal and state levels, and internationally. The applicable laws and regulations change frequently and we cannot be certain that the Company will not be subject to audit, inquiry, or investigation with respect to some aspect of its operations.
Our clinical services sales team is organized into nine regions in the United States – Northeast, Northwest, Mid-Atlantic, South, Southeast, North Central, West, Great Lakes, and South Central. Our sales team is focused on value-based care solutions and end-to-end client experience as a growth driver.
Our clinical services sales team is organized into ten regions in the United States – Northeast, Pacific North, South Central, South East, West, Mid-Atlantic, Mountain, Central, Great Lakes and Florida. Our sales team is focused on value-based care solutions and end-to-end client experience as a growth driver.
Payer Mix The following table reflects our estimate of the breakdown of net revenue by type of payer for the years ended December 31, 2024, 2023 and 2022: 2024 2023 2022 Client direct billing 72 % 72 % 73 % Commercial insurance 15 % 15 % 14 % Medicare and other government 13 % 13 % 13 % Self-pay — % — % — % Total 100 % 100 % 100 % Insurance We maintain professional liability and numerous other insurance policies.
Payer Mix The following table reflects our estimate of the breakdown of net revenue by type of payer for the years ended December 31, 2025, 2024 and 2023: 10 Table of Contents NEOGENOMICS, INC. 2025 2024 2023 Client direct billing 71 % 72 % 72 % Commercial insurance 16 % 15 % 15 % Medicare and other government 13 % 13 % 13 % Self-pay — % — % — % Total 100 % 100 % 100 % Insurance We maintain professional liability and numerous other insurance policies.
Due to multiple factors, including the timing of product launches and investments we make in our business, and the annual reset of patient deductibles, our revenue often increases over the course of the year, with a majority of our revenue generated in the third and fourth quarters.
Due to multiple factors, including the timing of product launches and investments we make in our business, and the annual reset of patient deductibles, our revenue often increases over the course of the year, such that a modestly greater portion of our revenue is generated in the third and fourth quarters.
This comprehensive molecular test menu allows our clients to obtain most of their molecular oncology testing needs satisfied by our laboratory. This is attractive to our clients as patient samples do not need to be split and then managed across several laboratories.
These tests are complemented by IHC and FISH tests when necessary. This comprehensive molecular test menu allows our clients to obtain most of their molecular oncology testing needs satisfied from our laboratory. This is attractive to our clients as patient samples do not need to be split and then managed across several laboratories.
The revenue streams include: • Clinical cancer testing; • Interpretation and consultative services; • Molecular and NGS testing; • Comprehensive technical and professional services offering; • Clinical trials and research; • Validation laboratory services; and • Oncology data solutions.
Revenue Streams Our revenue streams include: • Clinical cancer testing; • Interpretation and consultative services; • Molecular and NGS testing; • MRD testing; • Comprehensive technical and professional services offering; • Third-party clinical trials and research support services; • Validation laboratory services; and • Oncology data solutions.
These sales representatives utilize our custom Customer Relationship Management System (“CRM”) to manage their territories, and we have integrated the key customer care functionality within our LIMS into the CRM so that our sales representatives can stay informed of emerging issues and opportunities within their regions.
All sales representatives utilize our custom Customer Relationship Management System (“CRM”) to manage their territories, and we have integrated the key customer care functionality within our Laboratory Information Management System (“LIMS”) into the CRM so that our sales representatives can stay informed of emerging issues and opportunities within their areas of business.
Compliance with licensure, accreditation, and quality standards are verified through periodic inspections by agents of relevant regulatory agencies and accrediting organizations, and we believe we are in material compliance with all licensure, accreditation, and quality requirements. Compliance and Ethics Program 12 Table of Contents NEOGENOMICS, INC.
Compliance with licensure, accreditation, and quality standards are verified through periodic inspections by agents of relevant regulatory agencies and accrediting organizations, and we believe we are in material compliance with all licensure, accreditation, and quality requirements.
It is also a criminal offense, under Title 18 U.S. Code, Section 287, for a person or entity to make a claim against the United States or any department or agency, knowing the claim to be false, fictitious, or fraudulent. The penalty is a fine and imprisonment of up to five years.
Code, Section 287, for a person or entity to make a claim against the United States or any department or agency, knowing the claim to be false, fictitious, or fraudulent. The penalty is a fine and imprisonment of up to five years.
Morphologic analysis may be performed on a wide variety of samples, such as peripheral blood, bone marrow, lymph nodes, and other sites such as lung, breast, etc.
Morphologic analysis may be performed on a wide variety of samples, such as peripheral blood, bone 5 Table of Contents NEOGENOMICS, INC. marrow, lymph nodes, and other organs such as lung, breast, etc.
IHC is widely used in the diagnosis of abnormal cells such as those found in cancer. Specific surface membrane, cytoplasmic, or nuclear markers may be identified. IHC is also widely used to understand the distribution and localization of differentially expressed proteins. Digital imaging allows clients to visualize scanned slides and also perform quantitative analysis for certain stains.
Specific surface membrane, cytoplasmic, or nuclear markers may be identified. IHC is also widely used to understand the distribution and localization of differentially expressed proteins. Digital imaging allows clients to visualize scanned slides and also facilitates quantitative analysis for certain stains.
World-Class Medical and Scientific Team Individuals comprising our medical and scientific team are specialists in the field of genetics, oncology and pathology. As of December 31, 2024, we employed or contracted with approximately 170 MDs and PhDs. We have many nationally and world-renowned pathologists on staff, which is a key differentiator from smaller laboratories.
Distinguished Medical and Scientific Team Individuals comprising our medical and scientific team are specialists in the field of genetics and pathology. As of December 31, 2025, we employed or contracted with approximately 135 MDs and PhDs. We have many nationally recognized team members on staff, which is a key differentiator from many smaller laboratories.
Turnaround Times We consistently focus on improving turnaround times for test results to our clients nationwide. By providing information to our clients in a timely manner, physicians can begin treating their patients as soon as possible. Timeliness of results from our clinical services is a driver of additional testing requests by referring physicians.
By providing information to our clients in a timely manner, physicians can begin treating their patients as soon as possible. Timeliness of results from our clinical services is a driver of additional testing requests by referring physicians.
Our mission is to save lives by improving patient care. Our vision is to become the world’s leader in cancer testing, information, and decision support by providing uncompromising quality, exceptional service, and innovative solutions.
We operate a network of cancer-focused testing laboratories in the United States and the United Kingdom. Our mission is to save lives by improving patient care. Our vision is to become the world’s leader in cancer testing, information, and decision support by providing uncompromising quality, exceptional service, and innovative solutions.
ITEM 1. BUSINESS NeoGenomics, Inc., a Nevada corporation (referred to individually as the “Company” or collectively with its subsidiaries as “NeoGenomics,” “we,” “us,” or “our,” in this Annual Report on Form 10-K) is the registrant for SEC reporting purposes. Our common stock is listed on The Nasdaq Stock Market LLC (“Nasdaq”) under the symbol “NEO”.
ITEM 1. BUSINESS NeoGenomics, Inc., a Nevada corporation (referred to individually as the “Company” or collectively with its subsidiaries as “NeoGenomics,” “we,” “us,” or “our” in this Annual Report on Form 10-K) is the registrant for SEC reporting purposes.
As of December 31, 2024, the Company operated College of American Pathologists (“CAP”) accredited and Clinical Laboratory Improvement Amendments of 1988 (“CLIA”) certified laboratories in Fort Myers, Florida; Aliso Viejo and Carlsbad, California; Research Triangle Park, North Carolina; and Houston, Texas; and a CAP accredited full-service, sample-processing laboratory in Cambridge, United Kingdom.
As of December 31, 2025, the Company operated College of American Pathologists (“CAP”) accredited and Clinical Laboratory Improvement Amendments of 1988 (“CLIA”) certified laboratories in Fort Myers, Florida; Aliso Viejo and Carlsbad, California; Durham, North Carolina; Ramsey, New Jersey; and Houston, Texas; and an International Organization for Standardization (“ISO”) certified, CAP accredited full-service, sample-processing laboratory in Cambridge, United Kingdom.
Our commitment to connecting patients with life-altering therapies and trials remains a core focus. We have invested in leading technologies to secure data and maintain transparency and choice for patients through our Notice of Privacy Practices.
Our commitment to connecting patients with life-altering therapies and trials remains a core focus. We have invested in leading technologies to secure data and maintain transparency and choice for patients through our Notice of Privacy Practices. Markets The oncology testing laboratory market in which we operate includes: • Diagnostic testing; • Therapy selection; and • Molecular Residual Disease testing.
Our Molecular and NGS test menus provide clients with the ability to order single gene molecular tests, targeted NeoTYPE and Neo Comprehensive panels that include the relevant actionable genes for a particular cancer type, as well as comprehensive NGS panels.
Our Molecular and NGS test menus provide clients with the ability to order single gene molecular tests, targeted NeoTYPE panels that include the relevant and actionable genes for a particular cancer type, and the PanTracer portfolio and Neo Comprehensive panels, which include a broader range of genes and may be utilized in many different cancer types.
Like HIPAA, these laws contain regulatory requirements for both robust data privacy and security programs and require data breach reporting should personal data be used or disclosed in a manner not allowed under the laws.
These laws cover a broader range of data in addition to patient data including data of employees, clients, and other individuals whose data we hold. Like HIPAA, these laws contain regulatory requirements for both robust data privacy and security programs and require data breach reporting should personal data be used or disclosed in a manner not allowed under the laws.
The properties measured include the relative size, relative granularity or internal complexity, and relative fluorescence intensity. These fluorescent antibodies bind to specific cellular antigens and are used to identify abnormal and/or malignant cell populations. Flow cytometry is typically utilized in diagnosing a wide variety of hematopoietic and lymphoid neoplasms.
The properties measured include the relative size, relative granularity or internal complexity, and relative fluorescence intensity. These fluorescent antibodies bind to specific cellular antigens and are used to identify abnormal and/or malignant cell populations.
In addition, we could be required to conduct additional clinical trials in order to support required applications, which could add cost, delay and uncertainty to the process of bringing our tests to market and maintaining compliance of our marketed tests.
In addition, we could be required to conduct clinical trials in order to support required applications, which could add cost, delay and uncertainty to the process of bringing our tests to market and maintaining compliance of our marketed tests. Our laboratory in Cambridge, United Kingdom does not conduct studies regulated by Good Laboratory Practice (“GLP”) or Good Clinical Practice (“GCP”).
Larger clinician practices internalizing pathology interpretation services can benefit from our tech-only service offering, allowing them to participate in this diagnostic process while we handle the more complex molecular testing services. We are a leading provider of Heme oncology diagnostic testing, which includes molecular and NGS testing, and one of the key providers of solid tumor NGS testing solutions.
Larger clinician practices internalizing pathology interpretation services can benefit from our tech-only service offering, allowing them to participate in this diagnostic process while we handle the more complex molecular testing services.
The hotline does not replace other resources available to our employees, including supervisors, managers, and human resources staff but is an alternative channel available 24 hours a day, 365 days a year. The hotline forwards all reports to the Chief Compliance Officer, who is responsible for investigating, reporting to the Compliance Committee, and documenting the disposition of each report.
The hotline does not replace other resources available to our employees, including supervisors, managers, and human resources staff but is an alternative channel available 24 hours a day, 365 days a year.
In the latter setting, the expert pathologists at NeoGenomics assist our client pathologists on their most difficult and complex cases. Reportable Segments In 2024, we simplified our operational approach, bringing Clinical Services and Advanced Diagnostics under a single segment.
In the latter setting, the expert pathologists at NeoGenomics assist our client pathologists on their most difficult and complex cases. Reportable Segment We operate under a single segment that encompasses a comprehensive range of services.
Our focus for 2025 is to sustain a purpose driven culture that maintains excellence in service and performance while growing through innovation.
Our focus for 2026 is to sustain a purpose driven culture that maintains excellence in service and performance while growing through targeted innovation and to further extend our market relevance in the areas of therapy selection and MRD.
We intend to continue our efforts to gain market share by offering a broad portfolio of tests with rapid turnaround times, wrap-around services, and solutions targeted to hospitals and community oncology segments. The addition of new tests (including proprietary ones), enhanced post-test consultation services, and personal attention from our direct sales force will further enhance our efforts.
We intend to continue our efforts to gain market share by offering a broad portfolio of tests with rapid turnaround times, wrap-around services, and solutions targeted to hospitals and community oncology segments.
It can determine if the therapy is working or if a cancer has returned. NeoGenomics operates primarily in the Diagnostic testing and Therapy selection markets. The field of precision oncology is evolving quickly, with new tests being developed at an accelerated pace.
It can determine if the therapy is working or if a cancer has returned. The field of precision oncology is evolving quickly, with new tests being developed at an accelerated pace. Based on medical and scientific discoveries from the last decade, cancer testing is categorized into three types: diagnostic testing, prognostic testing, and predictive testing.
We believe that our exclusive focus on oncology, enabled by our expansive oncology testing menu and our high level of service will allow us to continue to gain market share in this segment. Many clinical reference laboratories have also entered the space in support of clinical trials and the related laboratory testing.
Many of these competitors are much larger and offer services across the healthcare spectrum. We believe that our exclusive focus on oncology, enabled by our expansive oncology testing menu and our high level of service, will allow us to continue to gain market share in this segment.
Enhance Our People and Culture • Enhance our Neo Culture; and • Expand scientific, medical and product capabilities. Competitive Strengths In addition to the competitive strengths discussed below, we believe that our superior testing technologies and instrumentation, laboratory information systems, client education programs and domestic and international presence also differentiate NeoGenomics from its competitors.
Competitive Strengths In addition to the competitive strengths discussed below, we believe that our superior testing technologies and instrumentation, laboratory information systems, client education programs and domestic and international operations also differentiate NeoGenomics from its competitors. Turnaround Times We consistently focus on improving turnaround times for test results to our clients nationwide.
This decision aims to streamline our operations and enhance our service offerings to our diverse client base, which includes community-based pathology and oncology practices, hospital pathology labs, reference labs, academic centers, and pharmaceutical companies. Revenue Streams Our single operating segment now encompasses a comprehensive range of services previously categorized under Clinical Services and Advanced Diagnostics.
This approach aims to streamline our operations and enhance our service offerings to our diverse client base, which includes community-based pathology and oncology practices, hospital pathology labs, reference labs, academic centers, and pharmaceutical companies.
The Company has implemented a program to comply with these laws and educates employees and its relevant vendors regularly on the requirements for vendor onboarding and conducting appropriate business interactions globally. 14 Table of Contents NEOGENOMICS, INC.
Because of the broad definitions of applicability of these laws, international clients or vendors working for government-owned entities are often considered to be governmental officials. The Company has implemented a program to comply with these laws and educates employees and its relevant vendors regularly on the requirements for vendor onboarding and conducting appropriate business interactions globally.
We value our teammates and focus on driving employee engagement through internal programs, external outreach, and other internal collaborative initiatives. Our commitment to maintaining an excellent workplace includes investing in ongoing opportunities for employee development in a diverse and inclusive environment.
We value our teammates and focus on driving employee engagement through internal programs, external outreach, and other internal collaborative initiatives. Our commitment to maintaining an excellent workplace includes investing in ongoing opportunities for employee development. We are also committed to rewarding, supporting and developing our employees as they work toward our common purposes of saving lives by improving patient care.
The successful qui tam relator who brought the case is entitled to a portion of the proceeds and its attorneys’ fees and costs. As most qui tam cases are filed by current or former employees, an effective compliance program, as defined by the DOJ and OIG, plays a crucial role in reducing the Company’s exposure to liability.
As 14 Table of Contents NEOGENOMICS, INC. most qui tam cases are filed by current or former employees, an effective compliance program, as defined by the DOJ and OIG, plays a crucial role in reducing the Company’s exposure to liability. It is also a criminal offense, under Title 18 U.S.
Overview NeoGenomics provides a wide range of oncology diagnostic testing and consultative services which includes technical laboratory services and professional interpretation of laboratory test results by licensed physicians or molecular experts who specialize in pathology and oncology. We operate a network of cancer-focused testing laboratories in the United States and the United Kingdom.
Our common stock is listed on The Nasdaq Stock Market LLC (“Nasdaq”) under the symbol “NEO.” Overview NeoGenomics provides a wide range of oncology diagnostic testing and consultative services including technical laboratory services and professional interpretation of laboratory test results by licensed physicians or molecular experts who specialize in pathology and oncology.
The hotline forwards any calls pertaining to the financial statements or financial issues to the Chairman of the Audit Committee. The Company does not allow any retaliation against an employee who reports a compliance related issue in good faith. The Board of Directors has a Compliance Committee that meets regularly to discuss all compliance-related issues that may affect the Company.
The Company strictly prohibits any retaliation against an employee who reports a compliance related issue in good faith. The Board of Directors has an Audit Committee that meets regularly to discuss all compliance-related issues that may affect the Company. The Company reviews its policies and procedures as new regulations and interpretations come to light to comply with applicable regulations.
This approach captures a full spectrum of genomic alterations, including mutations, fusions, copy number variations, and splicing mutations, as well as tumor mutation burden (TMB) and microsatellite instability (MSI) for solid tumors. These tests are complemented by IHC and FISH tests when necessary. 6 Table of Contents NEOGENOMICS, INC.
Additionally, we have molecular-only and comprehensive NGS-targeted panels, which combine DNA and RNA into a single workflow. This approach captures a full spectrum of genomic alterations, including 6 Table of Contents NEOGENOMICS, INC. mutations, fusions, copy number variations, and splicing mutations, as well as tumor mutation burden (“TMB”) and microsatellite instability (“MSI”) for solid tumors.
On September 29, 2023, the FDA published a proposed rule on LDTs in which the FDA proposes to end its historical policy of enforcement discretion for virtually all LDTs in five stages over a four-year period from the date FDA publishes a final rule.On April 29, 2024, the FDA announced a final rule on the regulation of Laboratory Developed Tests (“LDTs”) which amends the FDA's regulations to make explicit that LDT's are devices under the Federal Food, Drug, and Cosmetic Act (“FD&C Act”).
On May 6, 2024, the FDA published a final rule on the regulation of Laboratory Developed Tests (“LDTs”) which amended the FDA's regulations to make explicit that LDT's are devices under the Federal Food, Drug, and Cosmetic Act (“FD&C Act”).
The quality of care provided to clients and their patients is of paramount importance to us. We maintain quality control processes, including standard operating procedures, controls, performance measurement and reporting mechanisms. Our employees are committed to providing accurate, reliable, and consistent services.
The Company has a Quality Management System, and we strive to conduct our business in a manner that meets applicable regulatory and accreditation requirements and industry standards. The quality of care provided to clients and their patients is of paramount importance to us. We maintain quality control processes, including standard operating procedures, controls, performance measurement and reporting mechanisms.
Laboratory Developed Tests The FDA has regulatory responsibility over instruments, test kits, reagents, and other medical devices used by clinical laboratories to perform diagnostic testing. High complexity and CLIA-certified laboratories such as ours frequently develop testing procedures intended exclusively for use by the developing laboratory to provide diagnostic results to customers.
High complexity and CLIA-certified laboratories such as ours frequently develop testing procedures intended exclusively for use by the developing laboratory to provide diagnostic results to customers. These tests are referred to as laboratory developed tests (“LDTs”). The regulatory framework governing LDTs is evolving, complex, and has been the subject of ongoing debate.
These laws include the European Union’s General Data Protection Regulation (“GDPR”), the United Kingdom GDPR, and similar privacy laws in other jurisdictions. These laws cover a broader range of data in addition to patient data including data of employees, clients, and other individuals whose data we hold.
Due to the Company’s international operations, we are also subject to a variety of international laws which serve to protect the personal data of individuals who are located in those countries. These laws include the European Union’s General Data Protection Regulation (“GDPR”), the United Kingdom GDPR, and similar privacy laws in other jurisdictions.
Our laboratory in Cambridge, United Kingdom is accredited by CAP and actively participates in CAP’s proficiency testing programs for all tests offered by the Company. CAP’s proficiency testing programs require participating laboratories to test specimens that they receive from an approved testing entity and return the results.
Our laboratory in Cambridge, United Kingdom is accredited by CAP and actively participates in CAP’s proficiency testing programs for all tests offered by the Company. In addition, the Cambridge laboratory maintains ISO 15189 certification, which is administered separately from CAP accreditation and establishes international quality and competence standards specific to medical laboratories.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeNew product development and commercialization involve a lengthy and complex process and we may be unable to develop or commercialize new products on a timely basis, or at all. • Ethical, legal and social concerns related to the use of genetic information could reduce demand for our tests. • The potential loss or delay of our material client contracts or of multiple contracts could adversely affect our results. • We may become involved in litigation, and our insurance may not sufficiently cover all claims brought against us, which will increase our expenses and may adversely affect our business and results of operations. • We may be unable to obtain, maintain or enforce our intellectual property rights and may be subject to intellectual property litigation that could adversely impact our business. • Intellectual property dispute over the RaDaR® assay may necessitate redesign, licensing, discontinuation, or significant damages, potentially harming our overall financial condition, results of operations, or cash flows. • Our involvement with clinical trials and research services creates a risk of liability. • Our investments in marketable securities are subject to certain risks which could affect our overall financial condition, results of operations, or cash flows. • Other manufacturers may discontinue or recall testing products used in our business. • We depend substantially upon third parties for payment of services, which reliance could have a material adverse effect on our cash flows and results of operations. • We depend on information technology systems and maintain protected personal data, and a cyber-attack or other breach affecting these information technology systems or protected data could have a material adverse effect on our results of operations. • Performance issues, service interruptions, or price increases by our shipping carriers could adversely affect our business, results of operations, and financial condition, and harm our reputation and ability to provide our specialized clinical services on a timely basis. • We use biological and hazardous materials that require considerable expertise and expense for handling, storage, or disposal and may result in claims against us.
Biggest changeNew product development and commercialization involve a lengthy and complex process and we may be unable to develop or commercialize new products on a timely basis, or at all. • Ethical, legal and social concerns related to the use of genetic information could reduce demand for our tests. • The potential loss or delay of our material client contracts or of multiple contracts could adversely affect our results. • We may become involved in litigation, and our insurance may not sufficiently cover all claims brought against us, which will increase our expenses and may adversely affect our business and results of operations. • We may be unable to obtain, maintain or enforce our intellectual property rights and may be subject to intellectual property litigation that could adversely impact our business. • Our provision of laboratory testing and related services in support of sponsor-led clinical trials and research studies may expose us to contractual, operational, regulatory, or reputational risks, including risks related to data integrity, turnaround times, and compliance with applicable quality standards. • Other manufacturers may discontinue or recall testing products used in our business. • We depend substantially upon third parties for payment of services, which reliance could have a material adverse effect on our cash flows and results of operations. • Business disruptions, including due to natural disasters, power loss, break-ins, global conflicts, political unrest, or unstable economic and market conditions, could have a material adverse effect on our business, results of operations, financial condition, and stock price. • We depend on information technology systems and maintain protected personal data, and a cyber-attack or other breach affecting these information technology systems or protected data could have a material adverse effect on our results of operations. • Performance issues, service interruptions, or price increases by our shipping carriers could adversely affect our business, results of operations, and financial condition, and harm our reputation and ability to provide our specialized clinical services on a timely basis. • We use biological and hazardous materials that require considerable expertise and expense for handling, storage, or disposal and may result in claims against us. • If we are unable to successfully manage the implementation of our Laboratory Information Management System (“LIMS”), our business and results of operations may be adversely affected.
Risks Relating to Our Business • We are dependent on key personnel and need to hire additional qualified personnel in order for our business to succeed. • If we are unable to keep pace with the rapid scientific and technological change characteristic to our industry, or to develop, or acquire licenses for, new or improved testing technologies, our competitive position, business, results of operations, and financial condition could be harmed. • We face the risk of capacity constraints, which could have a material adverse effect on our business, results of operations, and financial condition. • Increased competition, including price competition, could have a material adverse impact on our net revenues and profitability. • We expect to make significant investments in the development of new genetic tests and other future products.
Risks Relating to Our Business and Operations • We are dependent on key personnel and need to hire additional qualified personnel in order for our business to succeed. • If we are unable to keep pace with the rapid scientific and technological change characteristic to our industry, or to develop, or acquire licenses for, new or improved testing technologies, our competitive position, business, results of operations, and financial condition could be harmed. • We face the risk of capacity constraints, which could have a material adverse effect on our business, results of operations, and financial condition. • Increased competition, including price competition, could have a material adverse impact on our net revenues and profitability. • We expect to make significant investments in the development of new genetic tests and other future products.
Risks Related to Our Common Stock and Indebtedness • The price of our common stock may fluctuate significantly. 18 Table of Contents NEOGENOMICS, INC. • Servicing our Convertible Notes require a significant amount of cash.
Risks Related to Our Common Stock and Indebtedness 18 Table of Contents NEOGENOMICS, INC. • The price of our common stock may fluctuate significantly. • Servicing our Convertible Notes require a significant amount of cash.
Any unforeseen increase in the volume of clients could strain the capacity of our personnel and systems, leading 20 Table of Contents NEOGENOMICS, INC. to unacceptable turnaround times or client service failures. In addition, as the number of our clients and specimens increases, our products, services, and infrastructure may not be able to scale accordingly.
Any unforeseen increase in the volume of clients could strain the capacity of our personnel and systems, leading to unacceptable turnaround times or client service failures. In addition, as the number of our clients and specimens increases, 20 Table of Contents NEOGENOMICS, INC. our products, services, and infrastructure may not be able to scale accordingly.
For example, development, marketing, sale, and performance of laboratory testing services expose us to the risk of litigation, including professional negligence or product liability claims, were someone to allege that our tests failed to perform as designed.
For example, the development, marketing, sale, and performance of laboratory testing services expose us to the risk of litigation, including professional negligence or product liability claims, were someone to allege that our tests failed to perform as designed.
Until such time we become a participating provider with such insurance companies, there can be no contractual assurance that we will be paid for the services we bill to such insurance companies or patients, and such third parties may change their reimbursement policies for non-participating providers in a manner that may have a material adverse effect on our cash flow or results of operations.
Until such time that we become a participating provider with such insurance companies, there can be no contractual assurance that we will be paid for the services we bill to such insurance companies or patients, and such third parties may change their reimbursement policies for non-participating providers in a manner that may have a material adverse effect on our cash flow or results of operations.
In connection with these transactions, the option counterparties or their respective affiliates may modify their hedge positions related to the capped call transactions by entering into or unwinding various derivatives with respect to our common stock and/or purchasing or selling our common stock or other securities of ours in secondary market transactions prior to the maturity of the 2028 Convertible Notes (and are likely to do so during any observation period related to a conversion of 2028 Convertible Notes or following any repurchase or redemption of the 2028 Convertible Notes).
In connection with these transactions, the option counterparties or their respective affiliates may modify their hedge positions related to the capped call transactions by entering into or unwinding various derivatives with respect to our common stock and/or purchasing or selling our common stock or other securities of ours in secondary market transactions prior to the maturity of the Convertible Notes (and are likely to do so during any observation period related to a conversion of Convertible Notes or following any repurchase or redemption of the Convertible Notes).
We frequently develop diagnostic tests for clients that cannot currently be provided using test kits approved or cleared by the FDA. Currently, all Laboratory Developed Tests (“LDTs”) are conducted and offered in accordance with the requirements of CLIA and individual state licensing procedures, but the FDA has had a policy of enforcement discretion with regard to LDTs.
We frequently develop diagnostic tests for clients that cannot currently be provided using test kits approved or cleared by the FDA. Currently, all Laboratory Developed Tests (“LDTs”) are conducted and offered in accordance with the requirements of CLIA and individual state licensing procedures, and the FDA has had a policy of enforcement discretion with regard to LDTs.
We are subject to extensive, federal, state and local laws and regulations in the U.S., including the following laws related to fraud and abuse: • the federal Anti-Kickback Statute (AKS), which prohibits knowingly and willfully offering, paying, soliciting, or receiving remuneration, directly or indirectly, in exchange for or to induce either the referral of an individual, or the furnishing, arranging for, or recommending of an item or service that is reimbursable, in whole or in part, by a federal health care program; • the Eliminating Kickbacks in Recovery Act of 2018 (EKRA), which is an all-payor anti-kickback prohibition on, among other things, knowingly and willfully paying or offering any remuneration directly or indirectly to induce a referral of an individual to a clinical laboratory; • the federal physician self-referral prohibition (Stark Law or the Physician Self-Referral Law), which, absent an exception, prohibits a physician from making a Medicare referral for certain designated health services, including clinical laboratory services, if the physician or an immediate family member of the physician has an applicable financial relationship with the entity providing the designated health services; • the federal False Claims Act (FCA), which, among other things, imposes liability on any person or entity that, among other things, knowingly presents, or causes to be presented, a false or fraudulent claim for payment to, or improperly retaining overpayments from, the federal government; • the federal Civil Monetary Penalties Law, which prohibits, among other things, the offering or transfer of remuneration to a Medicare or Medicaid beneficiary if the person knows or should know it is likely to influence the beneficiary’s selection of a particular provider, practitioner, or supplier of services reimbursable by Medicare or Medicaid, unless an exception applies; • the Health Insurance Portability and Accountability Act of 1996 (HIPAA) fraud and abuse provisions, which created federal criminal statutes that prohibit, among other things, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, including private insurers, knowingly and willfully embezzling or stealing from a healthcare benefit program, willfully obstructing a criminal investigation of a healthcare offense, and knowingly and willfully falsifying, concealing or covering up a material fact or making any 32 Table of Contents NEOGENOMICS, INC. materially false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services; and • other federal and state fraud and abuse laws, such as anti-kickback laws, prohibitions on self-referral and fee-splitting, and false claims acts, which may extend to services reimbursable by any third-party payor, including private insurers.
We are subject to extensive federal, state and local laws and regulations in the U.S., including the following laws related to fraud and abuse: • the federal Anti-Kickback Statute (AKS), which prohibits knowingly and willfully offering, paying, soliciting, or receiving remuneration, directly or indirectly, in exchange for or to induce either the referral of an individual, or the furnishing, arranging for, or recommending of an item or service that is reimbursable, in whole or in part, by a federal health care program; • the Eliminating Kickbacks in Recovery Act of 2018 (EKRA), which is an all-payer anti-kickback prohibition on, among other things, knowingly and willfully paying or offering any remuneration directly or indirectly to induce a referral of an individual to a clinical laboratory; • the federal physician self-referral prohibition (Stark Law or the Physician Self-Referral Law), which, absent an exception, prohibits a physician from making a Medicare referral for certain designated health services, including 33 Table of Contents NEOGENOMICS, INC. clinical laboratory services, if the physician or an immediate family member of the physician has an applicable financial relationship with the entity providing the designated health services; • the federal False Claims Act (FCA), which, among other things, imposes liability on any person or entity that, among other things, knowingly presents, or causes to be presented, a false or fraudulent claim for payment to, or improperly retaining overpayments from, the federal government; • the federal Civil Monetary Penalties Law, which prohibits, among other things, the offering or transfer of remuneration to a Medicare or Medicaid beneficiary if the person knows or should know it is likely to influence the beneficiary’s selection of a particular provider, practitioner, or supplier of services reimbursable by Medicare or Medicaid, unless an exception applies; • the Health Insurance Portability and Accountability Act of 1996 (HIPAA) fraud and abuse provisions, which created federal criminal statutes that prohibit, among other things, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, including private insurers, knowingly and willfully embezzling or stealing from a healthcare benefit program, willfully obstructing a criminal investigation of a healthcare offense, and knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services; and • other federal and state fraud and abuse laws, such as anti-kickback laws, prohibitions on self-referral and fee-splitting, and false claims acts, which may extend to services reimbursable by any third-party payer, including private insurers.
When new Current Procedural Terminology (“CPT”) codes are introduced by the American Medical Association (“AMA”) it often takes time for commercial insurance providers to recognize the new codes, which can significantly impact the timing of payments, if any, and can increase our days-sales-outstanding.
Separately, when new Current Procedural Terminology (“CPT”) codes are introduced by the American Medical Association (“AMA”) it often takes time for commercial insurance providers to recognize the new codes, which can significantly impact the timing of payments, if any, and can increase our days-sales-outstanding.
The Convertible Notes may from time to time in the future be convertible at the option of their holders prior to their scheduled terms under certain circumstances. Any sales in the public market of the common stock issuable upon such conversion could adversely affect prevailing market price of our common stock.
The Convertible Notes may from time to time in the future be convertible at the option of their holders prior to their scheduled terms under certain circumstances. Any sales in the public market of the shares of common stock issuable upon such conversion could adversely affect prevailing market price of our common stock.
Risks Relating to Our Business We are dependent on key personnel and need to hire additional qualified personnel in order for our business to succeed. Our performance is substantially dependent on the performance of our senior management and key scientific and technical personnel. In particular, our success depends substantially on the continued efforts of our senior management team.
Risks Relating to Our Business and Operations We are dependent on key personnel and need to hire additional qualified personnel in order for our business to succeed. Our performance is substantially dependent on the performance of our senior management and key scientific and technical personnel. In particular, our success depends substantially on the continued efforts of our senior management team.
As a result of this and future consolidations, our client diversity may decrease and our business may be adversely affected. We expect to make significant investments in the development of new genetic tests and other future products.
As a result of this and future consolidations, our client diversity may decrease and our business may be adversely affected. We expect to make significant investments in the development of new genetic and diagnostic tests and other future products.
Potential difficulties we may encounter as part of the integration process, include the following: • the potential inability to successfully combine the acquired company’s business with our business in a manner that permits us to achieve the cost synergies expected to be achieved when expected, or at all, and other benefits anticipated to result from such transaction; • challenges optimizing the client information and technology of the two companies, including the goal of consolidating to one laboratory information system and one billing system; • challenges effectuating any diversification strategy, including challenges achieving revenue growth from sales of each company’s products and services to the clients of the other company; • difficulties offering products and services across our expanded portfolio; • the need to revisit assumptions about reserves, revenues, capital expenditures, and operating costs, including expected synergies; 38 Table of Contents NEOGENOMICS, INC. • challenges faced by a potential diversion of the attention of our management as a result of the integration, which in turn could adversely affect our ability to maintain relationships with clients, employees and other constituencies or our ability to achieve the anticipated benefits of such transaction; • the potential loss of key employees, clients, managed care contracts, or strategic partners, or the ability to attract or retain key management and other key personnel, which could have an adverse effect on our ability to integrate and operate the acquired business; • complexities associated with managing the combined businesses, including difficulty addressing possible differences in corporate cultures and management philosophies and the challenge of integrating complex systems, technology, networks, and other assets of each of the companies in a seamless manner that minimizes any adverse impact on clients, suppliers, employees, and other constituencies; • costs and challenges related to the integration of the acquired company’s internal controls over financial reporting with ours; and • potential unknown liabilities and unforeseen increased expenses.
Potential difficulties we may encounter as part of the integration process, include the following: • the potential inability to successfully combine the acquired company’s business with our business in a manner that permits us to achieve the cost synergies expected to be achieved when expected, or at all, and other benefits anticipated to result from such transaction; • challenges optimizing the client information and technology of the two companies, including the goal of consolidating to one laboratory information system and one billing system; • challenges effectuating any diversification strategy, including challenges achieving revenue growth from sales of each company’s products and services to the clients of the other company; • difficulties offering products and services across our expanded portfolio; • the need to revisit assumptions about reserves, revenues, capital expenditures, and operating costs, including expected synergies; • challenges faced by a potential diversion of the attention of our management as a result of the integration, which in turn could adversely affect our ability to maintain relationships with clients, employees and other constituencies or our ability to achieve the anticipated benefits of such transaction; • the potential loss of key employees, clients, managed care contracts, or strategic partners, or the ability to attract or retain key management and other key personnel, which could have an adverse effect on our ability to integrate and operate the acquired business; • complexities associated with managing the combined businesses, including difficulty addressing possible differences in corporate cultures and management philosophies and the challenge of integrating complex systems, technology, networks, and other assets of each of the companies in a seamless manner that minimizes any adverse impact on clients, suppliers, employees, and other constituencies; • costs and challenges related to the integration of the acquired company’s internal controls over financial reporting with ours; and • potential unknown liabilities and unforeseen increased expenses.
In addition, our ability to repurchase the Convertible Notes or to pay cash upon conversions of the Convertible Notes may be limited by law, by regulatory authority, or by agreements governing our future indebtedness.
In addition, our ability to repurchase the Convertible Notes or to pay cash upon conversions of the Convertible Notes may be limited by applicable law, by regulatory authority, or by agreements governing our future indebtedness.
As of December 31, 2024, the Company has accrued a reserve of $11.2 million in other long-term liabilities on the Consolidated Balance Sheets for potential damages and liabilities associated with the federal healthcare program revenue received by the Company in connection with the agreements at issue that were identified during the course of this internal investigation.
As of December 31, 2025, the Company has accrued a reserve of $11.2 million in other long-term liabilities on the Consolidated Balance Sheets for potential damages and liabilities associated with the federal healthcare program revenue received by the Company in connection with the agreements at issue that were identified during the course of this internal investigation.
We cannot be assured that some of our molecular tests will ever be covered services by Medicare, nor can we determine when the medical literature will meet the standard for coverage that Medicare Administrative Contractors have set. In November 2017, CMS initiated a national coverage analysis for the use of NGS diagnostic tests for patients with advanced cancer.
We cannot be certain that some of our molecular tests will ever be covered services by Medicare, nor can we determine when the medical literature will meet the standard for coverage that Medicare Administrative Contractors have set. In November 2017, CMS initiated a national coverage analysis for the use of NGS diagnostic tests for patients with advanced cancer.
The price of our common stock could fluctuate significantly for many reasons including the following: • change in our leadership or Board of Directors; 26 Table of Contents NEOGENOMICS, INC. • future announcements concerning us or our competitors; • regulatory developments and enforcement actions bearing on advertising, marketing, or sales; • reports and recommendations of analysts and whether or not we meet the milestones and metrics set forth in such reports; • gaining or losing large clients or managed care plans; • introduction of new products or services and related insurance coverage; • acquisition or loss of significant manufacturers, distributors or suppliers, or an inability to obtain sufficient quantities of materials needed to provide our services; • quarterly variations in operating results; • business acquisitions or divestitures; • changes in the regulation of LDTs; • changes in governmental or third-party reimbursement practices and rates; and • fluctuations in the economy, political events, or general market conditions.
The price of our common stock could fluctuate significantly for many reasons, including the following: • change in our leadership or Board of Directors; • future announcements concerning us or our competitors; • regulatory developments and enforcement actions bearing on advertising, marketing, or sales; • reports and recommendations of analysts and whether or not we meet the milestones and metrics set forth in such reports; • gaining or losing large clients or managed care plans; • introduction of new products or services and related insurance coverage; • acquisition or loss of significant manufacturers, distributors or suppliers, or an inability to obtain sufficient quantities of materials needed to provide our services; • quarterly variations in operating results; • business acquisitions or divestitures; • changes in the regulation of LDTs; • changes in governmental or third-party reimbursement practices and rates; and • fluctuations in the economy, political events, or general market conditions.
We also face increased competition from laboratories that are more specialized and focused on particular areas such as liquid biopsies or large tissue based molecular panels such as Guardant Health, Inc., Natera, Inc., Exact Sciences Corp, Caris Life Science, Tempus Labs, Inc and Myriad Genetics, Inc.
We also face increased competition from laboratories that are more specialized and focused on particular areas such as liquid biopsies or large tissue based molecular panels such as Guardant Health, Inc., Natera, Inc., Exact Sciences Corp, Caris Life Science, Tempus AI, Inc and Myriad Genetics, Inc.
Management expects that our results of operations may fluctuate significantly in the future as a result of a variety of factors, including, but not limited to: (i) the continued rate of growth, usage, and acceptance of our products and services; (ii) demand for our products and services; (iii) the introduction and acceptance of new or enhanced products or services by us or by competitors; (iv) our ability to anticipate and effectively adapt to developing markets and to rapidly changing technologies; (v) our ability to attract, retain, and motivate qualified personnel; (vi) the initiation, renewal, or expiration of significant 39 Table of Contents NEOGENOMICS, INC. contracts with any major clients; (vii) pricing changes by us, our suppliers, or our competitors; (viii) seasonality; and (ix) general economic conditions and other factors.
Management expects that our results of operations may fluctuate significantly in the future as a result of a variety of factors, including, but not limited to: (i) the continued rate of growth, usage, and acceptance of our products and services; (ii) demand for our products and services; (iii) the introduction and acceptance of new or enhanced products or services by us or by competitors; (iv) our ability to anticipate and effectively adapt to developing markets and to rapidly changing technologies; (v) our ability to attract, retain, and motivate qualified personnel; (vi) the initiation, renewal, or expiration of significant contracts with any major clients; (vii) pricing changes by us, our suppliers, or our competitors; (viii) seasonality; and (ix) general economic conditions and other factors.
On March 16, 2018, CMS issued a final decision memorandum for NGS as a diagnostic laboratory test and determined it to be reasonable and necessary, and covered nationally when performed in a CLIA-certified laboratory, ordered by a treating physician, and all of the following requirements are met: (a) the patient has either recurrent, relapsed, refractory, metastatic, or advanced stages III or IV cancer; (b) the patient has either not been previously tested using the same NGS test for the same primary diagnosis of cancer or has had repeat testing using the same NGS test only when a new primary cancer diagnosis is made by the treating physician; and (c) the patient has decided to seek further cancer treatment (e.g., therapeutic chemotherapy).
On March 16, 2018, CMS issued a final decision memorandum for NGS as a diagnostic laboratory test and determined it to be reasonable and 31 Table of Contents NEOGENOMICS, INC. necessary, and covered nationally when performed in a CLIA-certified laboratory, ordered by a treating physician, and all of the following requirements are met: (a) the patient has either recurrent, relapsed, refractory, metastatic, or advanced stages III or IV cancer; (b) the patient has either not been previously tested using the same NGS test for the same primary diagnosis of cancer or has had repeat testing using the same NGS test only when a new primary cancer diagnosis is made by the treating physician; and (c) the patient has decided to seek further cancer treatment (e.g., therapeutic chemotherapy).
While we maintain a robust compliance program that includes consistent, detailed review of our documentation, coding, and billing practices, the rules are frequently vague, complex, and continually changing and we cannot assure that governmental authorities, private insurers, or private whistleblowers will not challenge our practices. Such a challenge could result in a material adverse effect on our business.
While we maintain a robust compliance program that includes consistent, detailed review of our documentation, coding, and billing practices, the rules are frequently vague, complex, and continually changing and we cannot be certain that governmental authorities, private insurers, or private whistleblowers will not challenge our practices. Such a challenge could result in a material adverse effect on our business.
Competition for such personnel is intense among the laboratory testing industry and we may not be able to retain our key managerial and technical employees or may not be able to attract and retain additional highly qualified managerial and technical personnel in the future.
Competition for such personnel is intense within the laboratory testing industry and we may not be able to retain our key managerial and technical employees or may not be able to attract and retain additional highly qualified managerial and technical personnel in the future.
Our competitors may develop products and services that are superior to ours or that achieve greater market acceptance than our offerings. Many of our competitors have long established relationships with their clients and third-party payers. We cannot assure you that we will be able to compete successfully with these entities or other competitors in the future.
Our competitors may develop products and services that are superior to ours or that achieve greater market acceptance than our offerings. Many of our competitors have long established relationships with their clients and third-party payers. We cannot be certain that we will be able to compete successfully with these entities or other competitors in the future.
Tests which are reimbursed by Medicare and other government payers (for example, State Medicaid programs) accounted for approximately 13%, 13% and 13% of our revenues for the years ended December 31, 2024, 2023 and 2022, respectively.
Tests which are reimbursed by Medicare and other government payers (for example, State Medicaid programs) accounted for approximately 13%, 13% and 13% of our revenues for the years ended December 31, 2025, 2024 and 2023, respectively.
We cannot be assured that all of the goals and anticipated benefits of an acquisition will be achievable, particularly as achievement of the benefits is in many important respects subject to factors that we do not control.
We cannot be certain that all of the goals and anticipated benefits of an acquisition will be achievable, particularly as achievement of the benefits is in many important respects subject to factors that we do not control.
Because litigation is inherently unpredictable, we cannot assure you that the results of any of these actions will not have a material adverse effect on our business, results of operations and financial condition. We may be unable to obtain, maintain or enforce our intellectual property rights and may be subject to intellectual property litigation that could adversely impact our business.
Because litigation is inherently unpredictable, we cannot be certain that the results of any of these actions will not have a material adverse effect on our business, results of operations and financial condition. We may be unable to obtain, maintain or enforce our intellectual property rights and may be subject to intellectual property litigation that could adversely impact our business.
However, we do not have contractual relationships with some of the insurance companies with whom we deal, nor are we necessarily able to become an approved provider for all government programs.
However, we do not have contractual relationships with some of the insurance companies with which we deal, nor are we necessarily able to become an approved provider for all government programs.
The market for genetic and molecular testing services is highly competitive, and, given the opportunities in this market within the laboratory testing industry, we expect competition to continue increasing. Our competitors within the broader genomics profiling space include laboratory companies such as Quest Diagnostics, Laboratory Corporation of America, and Bio-Reference Laboratories.
The market for genetic and molecular testing services is highly competitive and, given the opportunities in this market within the laboratory testing industry, we expect competition to continue increasing. Our competitors within the broader genomics profiling space include laboratory companies such as Quest Diagnostics, Laboratory Corporation of America, and ARUP Laboratories.
On January 27, 2020 CMS 30 Table of Contents NEOGENOMICS, INC. issued a final decision memorandum expanding coverage of a FDA approved or cleared NGS test when performed in a CLIA-certified laboratory, ordered by a treating physician, and all of the following requirements are met (a) the patient has ovarian or breast cancer; (b) the patient has clinical indications for germline (inherited) testing ; (c) the patient has a risk factor for germline (inherited) breast or ovarian cancer; and (d) the patient has not been previously tested with the same germline test using NGS for the same germline genetic content.
On January 27, 2020 CMS issued a final decision memorandum expanding coverage of a FDA approved or cleared NGS test when performed in a CLIA-certified laboratory, ordered by a treating physician, and all of the following requirements are met (a) the patient has ovarian or breast cancer; (b) the patient has clinical indications for germline (inherited) testing ; (c) the patient has a risk factor for germline (inherited) breast or ovarian cancer; and (d) the patient has not been previously tested with the same germline test using NGS for the same germline genetic content.
Risks Relating to Government Regulation and Reimbursement • If the FDA were to begin to enforce regulation of Laboratory Developed Tests it could require us to conduct additional clinical trials, result in increased costs or delays, or we could fail to obtain necessary regulatory approvals, all of which could harm our business. • Healthcare reform efforts may impact our business and the pricing we receive for our services. • Changes in laws, regulations, contracting arrangements with payers, or payer policies, including steps taken by payers to control utilization and reimbursement of healthcare services, may adversely affect coverage or reimbursement for our specialized clinical services, which may decrease our revenues and adversely affect our results of operations and financial condition. • Failure to comply with laws and regulations regarding laboratory licensing and operations, including CLIA environmental, health, and safety laws and regulations such as the federal Occupational Safety and Health Administration Act and the Needlestick Safety and Prevention Act, could result in fines and penalties and loss of licensure, and have a material adverse effect upon our business. • Our net revenue will be diminished if payers do not adequately cover or reimburse our services. • Our operations are subject to strict laws prohibiting fraudulent billing and other abuse, and our failure to comply with such laws could result in substantial penalties, including exclusion from participation in Medicare, Medicaid, and other governmental payer programs. • The failure to comply with fraud and abuse laws, including physician self-referral laws and anti-kickback laws, may subject us to liability, penalties, or limitation of operations. • If our agreements or arrangements with certain of our licensed physicians and/or professional associations owned by physicians are deemed invalid under state corporate practice of medicine and similar laws or federal law, or are terminated as a result of changes in state law, it could have a material impact on our results of operations and financial condition. • Failure to comply with federal, state and international laws related to privacy and security could result in fines, penalties, and damage to the Company’s reputation with clients and could have a material adverse effect upon the Company’s business.
Risks Relating to Government Regulation and Reimbursement • If the FDA were to begin to regulate Laboratory Developed Tests as medical devices it could require us to conduct additional clinical trials and obtain regulatory approval for our products, which could harm our business. • Healthcare reform efforts may impact our business and the pricing we receive for our services. • Changes in laws, regulations, contracting arrangements with payers, or payer policies, including steps taken by payers to control utilization and reimbursement of healthcare services, may adversely affect coverage or reimbursement for our specialized clinical services, which may decrease our revenues and adversely affect our results of operations and financial condition. • Failure to comply with laws and regulations regarding laboratory licensing and operations, including CLIA environmental, health, and safety laws and regulations such as the federal Occupational Safety and Health Administration Act and the Needlestick Safety and Prevention Act, could result in fines and penalties and loss of licensure, and have a material adverse effect upon our business. • Our net revenue will be diminished if payers do not adequately cover or reimburse our services. • Our operations are subject to strict laws prohibiting fraudulent billing and other abuse, and our failure to comply with such laws could result in substantial penalties, including exclusion from participation in Medicare, Medicaid, and other governmental payer programs. • The failure to comply with fraud and abuse laws, including physician self-referral laws and anti-kickback laws, may subject us to liability, penalties, or limitation of operations. • If our agreements or arrangements with certain of our licensed physicians and/or professional associations owned by physicians are deemed invalid under state corporate practice of medicine and similar laws or federal law, or are terminated as a result of changes in state law, it could have a material impact on our results of operations and financial condition. • Failure to comply with federal, state and international laws related to privacy and security could result in fines, penalties, and damage to the Company’s reputation with clients and could have a material adverse effect upon the Company’s business.
We will continue to be a non-contracted provider until such time as we enter into contracts with third-party payers with whom we are not currently contracted.
We will continue to be a non-contracted provider until such time as we enter into contracts with third-party payers with which we are not currently contracted.
Before we can commercialize any new products, we will need to expend significant funds in order to: • conduct substantial research and development, including validation studies and clinical studies; • further develop and scale our laboratory processes to accommodate different products, including the expansion of our medical staff and PhDs; • further develop and scale our infrastructure to be able to analyze increasingly large amounts of data; and 21 Table of Contents NEOGENOMICS, INC. • seek and obtain regulatory clearance or approvals of our new products, as required by applicable regulations.
Before we can commercialize any new products, we will need to expend significant funds in order to: • conduct substantial research and development, including validation studies and clinical studies; • further develop and scale our laboratory processes to accommodate different products, including the expansion of our medical staff and PhDs; • further develop and scale our infrastructure to be able to analyze increasingly large amounts of data; and • seek and obtain regulatory clearance or approvals of our new products, as required by applicable regulations.
We compete in the market place primarily on three factors: (i) the quality and accuracy of our test results; (ii) the speed or turnaround times of our testing services; and (iii) our ability to provide after-test support to those physicians requesting consultation.
We compete in the marketplace primarily on three factors: (i) the quality and accuracy of our test results; (ii) the speed or turnaround times of our testing services; and (iii) our ability to provide after-test support to those physicians requesting consultation.
Upon conversion of any of the 2028 Convertible Notes, we will satisfy our conversion obligation by paying or delivering, as the case may be, cash, shares of our common stock, or a combination of cash and shares of our common stock, at our election, and the capped call transactions are intended to reduce the potential dilution upon conversion of the 2028 Convertible Notes and/or offset some or all of any cash payments we are required to make in excess of the principal amount of converted 2028 Convertible Notes, as the case may be, with such reduction and/or offset subject to a cap.
Upon conversion of any of the Convertible Notes, we will satisfy our conversion obligation by paying or delivering, as the case may be, cash, shares of our common stock, or a combination of cash and shares of our common stock, at our election, and the capped call transactions are intended to reduce the potential dilution to our common stock (or, in the event a conversion of the Convertible Notes is settled in cash, to reduce our cash payment obligation) upon conversion of the Convertible Notes and/or offset some or all of any cash payments we are required to make in excess of the principal amount of converted Convertible Notes, as the case may be, with such reduction and/or offset subject to a cap.
These factors would include the reactions of third parties with whom we enter into contracts and do business and the reactions of investors and analysts.
These factors would include the reactions of third parties with which we enter into contracts and do business and the reactions of investors and analysts.
The sanctions for failure to comply with CLIA, state licensure requirements, or other applicable laws and regulations include the suspension, revocation, or limitation of the right to perform clinical laboratory services or receive compensation for those services, as well as the requirement to enter into a corrective action plan to monitor compliance, and the imposition of civil or criminal penalties or administrative fines.
The sanctions for failure to comply with CLIA, state licensure requirements, or other applicable laws and 32 Table of Contents NEOGENOMICS, INC. regulations include the suspension, revocation, or limitation of the right to perform clinical laboratory services or receive compensation for those services, as well as the requirement to enter into a corrective action plan to monitor compliance, and the imposition of civil or criminal penalties or administrative fines.
As drafted, an EKRA prohibition on incentive compensation to sales employees, payments to group purchasing organizations (“GPOs”), or group 35 Table of Contents NEOGENOMICS, INC. practices is broader than the federal AKS. Significantly, EKRA permits the U.S. Department of Justice (the “DOJ”) to issue regulations clarifying EKRA’s exceptions or adding additional exceptions, but such regulations have not yet been issued.
As drafted, an EKRA prohibition on incentive compensation to sales employees, payments to group purchasing organizations (“GPOs”), or group practices is broader than the federal AKS. Significantly, EKRA permits the U.S. Department of Justice (the “DOJ”) to issue regulations clarifying EKRA’s exceptions or adding additional exceptions, but such regulations have not yet been issued.
Because a portion of our revenues is from third-party payers with whom we are not currently contracted, it is possible that we will be required to make positive or negative adjustments to accounting estimates with respect to contractual allowances in the future, which may adversely affect our results of operations, our credibility with financial analysts and investors, and our stock price. 29 Table of Contents NEOGENOMICS, INC.
Because a portion of our revenues is from third-party payers with which we are not currently contracted, it is possible that we will be required to make positive or negative adjustments to accounting estimates with respect to contractual allowances in the future, which may adversely affect our results of operations, our credibility with financial analysts and investors, and our stock price.
The HIPAA Rules do not supersede state laws that may be more stringent; therefore, we are required to comply with both federal privacy and security regulations and varying state privacy and security laws and regulations. The HIPAA Rules also require healthcare providers like us to notify affected individuals, the Secretary of the U.S.
The HIPAA Rules do not supersede state laws that may be more stringent; therefore, we are required to comply with both federal privacy and security regulations and varying state privacy and security laws and regulations. 37 Table of Contents NEOGENOMICS, INC. The HIPAA Rules also require healthcare providers like us to notify affected individuals, the Secretary of the U.S.
Additionally, HIPAA allows state Attorneys General to bring an action against a covered entity, such as us, for a violation of HIPAA. We insure some of our risk with respect to HIPAA security breaches, but operational costs and penalties associated with HIPAA breaches easily could exceed our insured limits. 36 Table of Contents NEOGENOMICS, INC.
Additionally, HIPAA allows state Attorneys General to bring an action against a covered entity, such as us, for a violation of HIPAA. We insure some of our risk with respect to HIPAA security breaches, but operational costs and penalties associated with HIPAA breaches easily could exceed our insured limits.
We cannot predict the number, timing or size of future acquisitions or the effect that any such transactions might have on our operating results. If goodwill and intangible assets that we recorded in connection with our acquisitions become impaired, we may have to take significant charges against earnings.
We cannot predict the number, timing or size of future acquisitions or the effect that any such transactions might have on our operating results. 40 Table of Contents NEOGENOMICS, INC. If goodwill and intangible assets that we recorded in connection with our acquisitions become impaired, we may have to take significant charges against earnings.
We require extensive, comprehensive training of all sales and marketing personnel, but cannot guarantee that every staff member will comply with the training. Thus, we could face liability under the AKS for non-compliance by individuals engaged in prohibited sales and marketing activities.
We require extensive, comprehensive training of all sales and marketing personnel, but cannot guarantee that every staff member will comply with the training. Thus, we could face liability under the AKS for non-compliance by individuals engaged in prohibited sales and marketing activities. 36 Table of Contents NEOGENOMICS, INC.
In addition, the Needlestick Safety and Prevention Act requires, among other things, that we include in our safety programs the evaluation and use of 31 Table of Contents NEOGENOMICS, INC. engineering controls such as safety needles, if found to be effective at reducing the risk of needlestick injuries in the workplace.
In addition, the Needlestick Safety and Prevention Act requires, among other things, that we include in our safety programs the evaluation and use of engineering controls such as safety needles, if found to be effective at reducing the risk of needlestick injuries in the workplace.
Privacy Shield Framework, under which 37 Table of Contents NEOGENOMICS, INC. personal data could be transferred from the EEA to U.S. entities that had self-certified under the Privacy Shield scheme. This framework has been replaced by the E.U.-U.S. Data Privacy Framework for which the European Commission adopted an adequacy decision in July 2023.
Privacy Shield Framework, under which personal data could be transferred from the EEA to U.S. entities that had self-certified under the Privacy Shield scheme. This framework has been replaced by the E.U.-U.S. Data Privacy Framework for which the European Commission adopted an adequacy decision in July 2023.
In addition, the existence of the Convertible Notes may encourage short selling by market participants because conversion could be used to satisfy short positions, and the anticipated conversion of the Convertible Notes into shares of our common stock could depress the price of our common stock.
In addition, the existence of the Convertible Notes may encourage short selling by market participants because the conversion of the Convertible Notes could be used to satisfy short positions, and the anticipated conversion of the Convertible Notes into shares of our common stock could depress the price of our common stock. 29 Table of Contents NEOGENOMICS, INC.
We may not have sufficient cash flow from our business to pay our obligations under the Convertible Notes, which could adversely affect our financial condition and operating results. In April 2020, we issued $201.3 million aggregate principal amount of 2025 Convertible Notes, and in January 2021, we issued $345.0 million aggregate principal amount of 2028 Convertible Notes.
We may not have sufficient cash flow from our business to pay our obligations under the Convertible Notes, which could adversely affect our financial condition and operating results. In January 2021, we issued $345.0 million aggregate principal amount of our Convertible Notes.
We have entered into capped call transactions with respect to the 2028 Convertible Notes to reduce the risk of dilution, but to the extent that the conversion price of the 2028 Convertible Notes exceeds the cap price of the capped calls or to the extent that the Convertible Notes are converted, such conversions will dilute the ownership interests of our existing stockholders.
We have entered into capped call transactions with respect to the Convertible Notes to reduce the risk of dilution, but to the extent that the conversion price of the Convertible Notes exceeds the cap price of the capped calls or to the extent that the Convertible Notes are converted, such conversions and the corresponding issuance of common stock will dilute the ownership interests of our existing stockholders.
While we invest in our systems and technology and in the protection of our products and data to reduce the risk of an attack or other significant disruption, there can be no assurance that these measures and efforts will prevent future attacks or other significant disruptions to any of the systems on which we rely.
While we invest in our systems and technology and in the protection of our products and data to reduce the risk of an attack or other significant disruption, we cannot be certain that these measures and efforts will prevent future attacks or other significant disruptions to any of the systems on which we rely.
Congress and federal agencies, such as CMS, have, from time to time, implemented changes to laws and regulations governing healthcare service providers, including specialized diagnostic service providers. These changes have adversely affected and may in the future adversely affect coverage for our services.
Congress and federal agencies, such as CMS, have, from time to time, implemented changes to laws and regulations 30 Table of Contents NEOGENOMICS, INC. governing healthcare service providers, including specialized diagnostic service providers. These changes have adversely affected and may in the future adversely affect coverage for our services.
Furthermore, in Florida, historically our largest referral market for laboratory testing services, a meaningful percentage of the population returns to their homes in the Northern United States to avoid the hot summer months. This, combined with our clients’ usual summer vacation schedules typically results in seasonality in our business.
Furthermore, in Florida, historically our largest referral market for laboratory testing services, a meaningful percentage of the population returns to their homes in the Northern United States to avoid the hot summer months. This, combined with our clients’ usual summer vacation schedules, typically results in a modest decline in the volume of our testing services during the summer vacation season.
We may become involved in litigation, and our insurance may not sufficiently cover all claims brought against us, which will increase our expenses and may adversely affect our business and results of operations.
We may become involved in litigation, and our insurance may not sufficiently cover all claims brought against us, which will increase our expenses and may adversely affect our business and results of operations. 22 Table of Contents NEOGENOMICS, INC.
Holders of the Convertible Notes have the right to require us to repurchase their Convertible Notes upon the occurrence of a fundamental change at a repurchase price equal to 100% of the principal amount of the Convertible Notes to be repurchased, plus accrued and unpaid interest, if any.
Holders of the Convertible Notes have the right to require us to repurchase their Convertible Notes upon the occurrence of a fundamental change (as defined in the indenture governing the Convertible Notes) at a cash repurchase price equal to 100% of the principal amount of the Convertible Notes to be repurchased, plus accrued and unpaid interest, if any.
When we submit bills for our services to third-party payers, we must follow complex documentation, coding, and billing rules which are based on federal and state laws, rules and regulations, various government publications, and on industry practice.
When we submit bills for our services to third-party payers, we must follow complex documentation, coding, and billing rules which are based on federal and state laws, rules and regulations, various government publications, and on industry 34 Table of Contents NEOGENOMICS, INC. practice.
In addition, we may be subject to intellectual property litigation, and we may be found to infringe on the proprietary rights of others, which could force us to do one or more of the following: • cease developing, performing or selling solutions or services that incorporate the challenged intellectual property; • obtain and pay for licenses from the holder of the infringed intellectual property right; • redesign or re-engineer our tests; • change our business processes; or • pay substantial damages, court costs and attorneys' fees, including potentially increased damages for any infringement held to be willful.
If we are found to infringe on the proprietary rights of others, we could be forced to do one or more of the following: • cease developing, performing or selling solutions or services that incorporate the challenged intellectual property; • obtain and pay for licenses from the holder of the infringed intellectual property right; • redesign or re-engineer our tests; • change our business processes; or • pay substantial damages, court costs and attorneys' fees, including potentially increased damages for any infringement held to be willful.
We may also be subject to liability for 22 Table of Contents NEOGENOMICS, INC. errors in the test results we provide to pathologists and oncologists related to a misunderstanding of, or inappropriate reliance upon, the information we provide.
We may also be subject to liability for errors in the test results we provide to pathologists and oncologists related to a misunderstanding of, or inappropriate reliance upon, the information we provide.
Even if we were to enter into an arrangement with such alternative provider, there can be no assurance that they will provide the same level of quality in transport services currently provided to us by the Carrier.
Even if we were to enter into an arrangement with such alternative provider, we cannot be certain that they will provide the same level of quality in transport services currently provided to us by the Carrier.
Similarly, there can be no assurance that third party information technology providers with whom we contract will not suffer a significant attack or disruption that impacts clients, such as supply chain attacks. Any significant breach, attack, disruption, or failure of our information technology systems could adversely affect our business, results of operations, and financial condition.
Similarly, we cannot be certain that third-party information technology providers with which we contract will not suffer a significant attack or disruption that impacts clients, such as supply chain attacks. Any significant breach, attack, disruption, or failure of our information technology systems could adversely affect our business, results of operations, and financial condition.
As addressed in Part I, Item 1, “Business— Licensure, Accreditation, and Quality Standards— Laboratory Developed Tests” in this Annual Report on Form 10-K, on April 29, 2024, the FDA announced a final rule on the regulation of LDTs, which amends the FDA's regulations to make explicit that LDT's are devices under the Federal Food, Drug, and Cosmetic Act (“FD&C Act”).
As addressed in Part I, Item 1, “Business— Licensure, Accreditation, and Quality Standards— Laboratory Developed Tests” in this Annual Report on Form 10-K, on April 29, 2024, the FDA’s final rule on the regulation of LDTs, which amended the FDA's regulations to make explicit that LDT's are devices under the Federal Food, Drug, and Cosmetic Act (“FD&C Act”), was vacated by the U.S.
A default under an indenture or the occurrence of the fundamental change may also lead to a default under agreements governing our future indebtedness.
A default under an indenture or the occurrence of the fundamental change may also lead to a default under any agreements governing our indebtedness we may incur in the future.
The Stark Law 34 Table of Contents NEOGENOMICS, INC. is a strict liability statute, and thus any technical violation requires repayment of all “tainted” referrals, regardless of the intent, unless an exception applies.
The Stark Law is a strict liability statute, and thus any technical violation requires repayment of all “tainted” referrals, regardless of the intent, unless an exception applies.
There can be no assurance that we will be successful in entering into agreements with these managed care programs at rates of payment similar to those we realize from our non-managed care lines of business.
We cannot be certain that we will be successful in entering into agreements with these managed care programs at rates of payment similar to those we realize from our non-managed care lines of business.
The price of our common stock has been, and is likely to continue to be, volatile and it could decline substantially within a short period of time.
Risks Related to Our Common Stock and Indebtedness The price of our common stock has, and may continue to, fluctuate significantly. The price of our common stock has been, and is likely to continue to be, volatile and it could decline substantially within a short period of time.
We have had certain tests discontinued by manufacturers and have had to develop alternative solutions for our clients. We depend substantially upon third parties for payment of services, which reliance could have a material adverse effect on our cash flows and results of operations.
Such discontinuations or recalls could adversely affect our costs, testing volume and revenues. We have had certain tests discontinued by manufacturers and have had to develop alternative solutions for our clients. We depend substantially upon third parties for payment of services, which reliance could have a material adverse effect on our cash flows and results of operations.
Third-party payers, including governmental payers such as Medicare and private payers, are scrutinizing new medical products and services and may not cover or may limit coverage and the level of reimbursement for our services.
Third-party payers, including governmental payers such as Medicare and private payers, are scrutinizing new medical products and services and may not cover or may limit coverage and the level of reimbursement for our services, or may impose processes, such as requirements for prior authorization, that can challenge coverage and reimbursement.
Similar laws continued to be proposed or passed at the U.S. federal and state level, including the Texas Data Privacy and Security Act, which took effect on July 1, 2024, the Oregon Consumer Privacy Act, which took effect on July 1, 2024, the Montana Consumer Data Privacy Act, which took effect on October 1, 2024, the Delaware Personal Data Privacy Act, which took effect on January 1, 2025, the Iowa Consumer Data Protection Act, which took effect on January 1, 2025, the Nebraska Data Privacy Act, which took effect on January 1, 2025, the New Hampshire Privacy Act, which took effect on January 1, 2025 and the New Jersey Data Privacy Act, which took effect on January 15, 2025.
Similar laws continued to be proposed or passed at the U.S. federal and state level, including the Texas Data Privacy and Security Act, which took effect on July 1, 2024, the Oregon Consumer Privacy Act, which took effect on July 1, 2024, the Montana Consumer Data Privacy Act, which took effect on October 1, 2024, the Delaware Personal Data Privacy Act, which took effect on January 1, 2025, the Iowa Consumer Data Protection Act, which took effect on January 1, 2025, the Kentucky Consumer Data Protection Act, which took effect on January 1, 2026, the Maryland Online Data Privacy Act, which took effect on October 1, 2025, the Minnesota Consumer Data Privacy Act, which took effect on July 31, 2025, the Nebraska Data Privacy Act, which took effect on January 1, 2025, the New Hampshire Privacy Act, which took effect on January 1, 2025, the New Jersey Data Privacy Act, which took effect on January 15, 2025, the Rhode Island Data Transparency and Privacy Protection Act, which took effect on January 1, 2026, and Tennessee Information Protection Act, which took effect on July 1, 2025, among other laws.
Existing federal laws governing Medicare and Medicaid, as well as other state and federal laws, also regulate certain aspects of the relationship between healthcare providers, including clinical laboratories, and their referral sources, including physicians, hospitals and other laboratories.
Existing federal laws governing Medicare and Medicaid, as well as other state and federal laws, also regulate certain aspects of the relationship between healthcare providers, including clinical laboratories, and their referral sources, including physicians, hospitals and other laboratories. Some of these laws, including the federal AKS and the federal Stark Law contain extremely broad proscriptions.
For example, there can be no assurance that we will be able to produce commercial products CGP or MRD.
For example, there can be no assurance that we will be able to successfully commercialize our MRD testing products or produce commercial products targeted towards CGP.
In addition, any significant increase in shipping rates could adversely affect our operating margins and results of operations. Similarly, strikes, severe weather, natural disasters, or other service interruptions by delivery services we use would adversely affect our ability to receive and process patient samples on a timely basis and, accordingly, our ability to compete with other providers of similar services.
Similarly, strikes, severe weather, natural disasters, or other service interruptions by delivery services we use would adversely affect our ability to receive and process patient samples on a timely basis and, accordingly, our ability to compete with other providers of similar services.
Subsequent legislation, including most recently the Continuing Appropriations and Extensions Act, 2025 that was passed in 2024, delayed the implementation of the 15.0 percent rate reduction cap to 2026 and extended the 15.0 percent rate reduction cap through 2028. When rate reductions begin to take effect again in 2024, this will further reduce Medicare program payments for CLFS tests.
Subsequent legislation, including most recently the Continuing Appropriations and Extensions Act, 2025 that was passed in 2024, delayed the implementation of the 15.0 percent rate reduction cap to 2026 and extended the 15.0 percent rate reduction cap through 2028. The effectiveness of the rate reductions, as of January 31, 2026, further reduces Medicare program payments for CLFS tests.
The HIPAA Rules do not supersede state laws that may be more stringent; therefore, we are required to comply with both federal privacy and security regulations as well as varying state privacy and security laws and regulations. These laws vary widely.
HHS has announced the agency's “commitment to intensify enforcement activity” to stop information blocking. The HIPAA Rules do not supersede state laws that may be more stringent; therefore, we are required to comply with both federal privacy and security regulations as well as varying state privacy and security laws and regulations. These laws vary widely.
Contracting with excluded individuals or entities, such as hiring an excluded person or contracting with an excluded vendor, can result in significant penalties.
Contracting with excluded individuals or entities, such as hiring an excluded person or contracting with an excluded vendor, can result in significant penalties. 35 Table of Contents NEOGENOMICS, INC.
General Risk Factors • We may not be able to implement our business strategy, which could impair our ability to continue operations. • We may be unable to realize estimated benefits from our cost reduction and restructuring efforts and our profitability may be hurt or our business might otherwise be adversely affected. • If we are unable to successfully integrate future acquisitions with our legacy business, the anticipated benefits of such transaction may not be realized. • If goodwill and intangible assets that we recorded in connection with our acquisitions become impaired, we may have to take significant charges against earnings. • We may incur greater costs than anticipated, which could result in sustained losses. • We may face fluctuations in our results of operations and we are subject to seasonality in our business which could negatively affect our business operations. • The steps we have taken to protect our proprietary rights may not be adequate, which could result in infringement or misappropriation by third parties. • We may be subject to claims that we or our employees have wrongfully used or disclosed alleged trade secrets. 19 Table of Contents NEOGENOMICS, INC.
General Risk Factors • We may not be able to implement our business strategy, which could impair our ability to continue operations. • We may form strategic partnerships or make investments in companies or technologies that could negatively affect our operating results, distract management’s attention from other business concerns, dilute our stockholders’ ownership, and significantly increase our debt, costs, expenses, liabilities and risks. • If we are unable to successfully integrate future acquisitions with our legacy business, the anticipated benefits of such transaction may not be realized. • If goodwill and intangible assets that we recorded in connection with our acquisitions become impaired, we may have to take significant charges against earnings. • We may incur greater costs than anticipated, which could result in sustained losses. • We may face fluctuations in our results of operations and we are subject to seasonality in our business which could negatively affect our business operations. • The steps we have taken to protect our proprietary rights may not be adequate, which could result in infringement or misappropriation by third parties. • We may be subject to claims that we or our employees have wrongfully used or disclosed alleged trade secrets. 19 Table of Contents NEOGENOMICS, INC.
Even if the FDA and other regulatory authorities clear or approve a new product or service we develop, we would need to commit substantial resources to commercialize, sell and market it before it could be profitable, and the product or service may never be commercially viable.
We would need to commit substantial resources to commercialize, sell and market any new product or service we develop before it could be profitable, and the product or service may never be commercially viable.
Increasingly complex methods have been used in cyber-attacks, including ransomware, phishing, structured query language injections, social engineering schemes, and distributed denial-of-service attacks. A cyber-attack can also be in the form of unauthorized access or a blocking of authorized access.
Cyber-attacks, security breaches, computer viruses, malware and other incidents could cause misappropriation, loss or other unauthorized disclosure of such information. Increasingly complex methods have been used in cyber-attacks, including ransomware, phishing, structured query language injections, social engineering schemes, and distributed denial-of-service attacks. A cyber-attack can also be in the form of unauthorized access or a blocking of authorized access.
In the event that the FDA begins to regulate our tests, it may require additional pre-market clinical testing prior to submitting a premarket approval, premarket notification, or other application to permit commercial sales.
In the event that the FDA begins to regulate our tests, it may require us to submit a premarket approval, premarket notification, or other application to permit commercial sales.
A number of other states have passed laws related to the privacy and security of consumer health information and personal data which will become effective within the next two years, including Tennessee, Minnesota, Maryland, Indiana, Kentucky and Rhode Island, and more states have proposed legislation under consideration.
A number of other states have passed laws related to the privacy and 38 Table of Contents NEOGENOMICS, INC. security of consumer health information and personal data which will become effective within the next two years, and more states have proposed legislation under consideration.
The capped call transactions may affect the value of the 2028 Convertible Notes and our common stock. In connection with the issuance of the 2028 Convertible Notes, we have entered into capped call transactions with the option counterparties.
The capped call transactions may affect the value of the Convertible Notes and our common stock. In connection with the issuance of the Convertible Notes, we entered into privately negotiated convertible note held transactions, referred to as capped call transactions, with certain option counterparties.
For newly developed tests or for established tests that have not been validated for clinical and analytical validity and clinical utility, laboratories must submit a detailed dossier of clinical data to substantiate that the test meets Medicare’s requirements for coverage.
For newly developed tests or for established tests that have not been validated for clinical and analytical validity and clinical utility, laboratories must submit a detailed dossier of clinical data to substantiate that the test meets Medicare’s requirements for coverage. The field of molecular diagnostics is evolving very rapidly, and clinical studies on many new tests are still underway.
Our ability to realize the full benefits of our backlog of contractually committed services due to delay, cancellation or reduction in our client’s contractual commitments, would materially impact our revenues.
Delays, terminations or reductions in the scope of our contracts impact our ability to convert our contractually committed services into revenue for the Company. Our ability to realize the full benefits of our contractually committed services due to delay, cancellation or reduction in our client’s contractual commitments, would materially impact our revenues.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe regularly assess risks from cybersecurity threats; monitor our information systems for potential vulnerabilities; and test those systems pursuant to our cybersecurity policies, processes, and practices, which are integrated into our overall risk management program. To ensure the continued effectiveness of our information security controls, we regularly engage both internal and external experts to evaluate our program.
Biggest changeWe regularly assess risks from cybersecurity threats; monitor our information systems for potential vulnerabilities; and test those systems pursuant to our cybersecurity policies, processes, and practices, which are integrated into our overall risk management program. We also rely on third parties, including cloud vendors, for various business functions.
However, as discussed under the heading “ We depend on information technology systems and maintain protected personal data, and a cyber-attack or other breach affecting these information technology systems or protected data could have a material adverse effect on our results of operations ” in Part I, Item 1A, “Risk Factors,” the Company remains subject to evolving cybersecurity risks that could have adverse impacts. 40 Table of Contents NEOGENOMICS, INC.
However, as discussed under the heading “ We depend on information technology systems and maintain protected personal data, and a cyber-attack or other breach affecting these information technology systems or protected data could have a material adverse effect on our results of operations ” in Part I, Item 1A, “Risk Factors,” the Company remains subject to evolving cybersecurity risks that could have adverse impacts.
These updates typically address: • Evolving cyber risks and threats; • Progress on strategic initiatives to safeguard our information systems; • Cyber incident response preparedness and capabilities; • Findings from assessments of our information security program; and • Insights into the emerging threat landscape.
These updates typically address: • Evolving cyber risks and threats; • Progress on strategic initiatives to safeguard our information systems; • Cyber incident response preparedness and capabilities; 42 Table of Contents NEOGENOMICS, INC. • Findings from assessments of our information security program; and • Insights into the emerging threat landscape.
ITEM 1C. CYBERSECURITY Cybersecurity Risk Management and Strategy We have developed and implemented a cybersecurity and information security risk management program intended to protect the confidentiality, integrity, and availability of our critical systems and information.
ITEM 1C. CYBERSECURITY Cybersecurity Risk Management and Strategy We have developed and implemented a cybersecurity and information security risk management program intended to protect the confidentiality, integrity, and availability of our critical systems and information. We have adopted processes designed to identify, assess and manage material risks from cybersecurity threats.
The results of these evaluations are reviewed by senior management and reported to the Board. In addition, we proactively collaborate with key vendors, industry peers, and relevant government and law enforcement entities to remain informed about new threats and best practices.
In addition, we proactively collaborate with key vendors, industry peers, and relevant government and law enforcement entities to remain informed about new threats and best practices.
Added
Those processes include response to and an assessment of internal and external threats to the security, confidentiality, integrity and availability of our data and information systems, along with other material risks to our operations.
Added
Our third-party services providers have access to our information systems and data, and we rely on such third parties for the continuous operation of our business operations.
Added
We select key third-party service providers based on several factors, including the type of data processed and the nature of services offered, and we oversee such key third party service providers by conducting vendor diligence upon onboarding and ongoing monitoring.
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To ensure the continued effectiveness of our information security controls, we regularly engage both internal and external experts to evaluate our program. The results of these evaluations are reviewed by senior management and reported to the Board.

Item 2. Properties

Properties — owned and leased real estate

1 edited+0 added−0 removed2 unchanged
Biggest changeThe following table summarizes our facilities by location and approximate square footage: Location Square Footage Fort Myers, Florida 150,000 Aliso Viejo, California 112,700 Houston, Texas 32,800 Durham, North Carolina 32,100 Carlsbad, California 28,600 Cambridge, United Kingdom 12,500 Nashville, Tennessee 7,800 Tampa, Florida 5,600 Phoenix, Arizona 4,700 Atlanta, Georgia 3,800 Fresno, California 2,600 Chicago, Illinois 2,200
Biggest changeThe following table summarizes our facilities by location and approximate square footage: Location Square Footage Fort Myers, Florida 150,000 Aliso Viejo, California 112,700 Ramsey, New Jersey 39,100 Houston, Texas 32,800 Durham, North Carolina 32,100 Carlsbad, California 28,600 Cambridge, United Kingdom 12,500 Nashville, Tennessee 7,800 Tampa, Florida 5,600 Phoenix, Arizona 4,700 Fresno, California 2,600 Chicago, Illinois 2,200 Plantation, Florida 100 Sarasota, Florida 100

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed0 unchanged
Biggest changeITEM 3. LEGAL PROCEEDINGS From time to time the Company is engaged in legal proceedings, including proceedings that arise in the ordinary course of business. For further information on legal proceedings, please refer to Note 15. Commitments and Contingencies, in the notes to our Consolidated Financial Statements. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 41 Table of Contents NEOGENOMICS, INC.
Biggest changeITEM 3. LEGAL PROCEEDINGS From time to time the Company is engaged in legal proceedings, including proceedings that arise in the ordinary course of business. For further information on legal proceedings, please refer to Note 15. Commitments and Contingencies, in the notes to our Consolidated Financial Statements. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 43 Table of Contents NEOGENOMICS, INC.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeIssuer Purchases of Equity Securities The following table sets forth information concerning our purchases of common stock for the periods indicated: Period of Repurchase Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs October 1, 2024 - October 31, 2024 542 $ 14.71 — — November 1, 2024 - November 30, 2024 2,267 $ 13.60 — — December 1, 2024 - December 31, 2024 19,211 $ 17.70 — — Total 22,020 — — (1) The Company’s 2023 Equity Incentive Plan, adopted on May 25, 2023, allows participants to surrender vesting shares having a fair market value equal to the required withholding tax related to the vesting of restricted stock.
Biggest changeIssuer Purchases of Equity Securities The following table sets forth information concerning our purchases of common stock for the periods indicated: Period of Repurchase Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs October 1, 2025 - October 31, 2025 488 $ 7.91 — — November 1, 2025 - November 30, 2025 623 $ 9.78 — — December 1, 2025 - December 31, 2025 23,475 $ 12.00 — — Total 24,586 — — (1) The Company's 2023 Equity Incentive Plan was adopted on May 25, 2023 and amended on May 22, 2025 (as amended, the “2023 Plan”).
The results assume that $100 (with reinvestment of all dividends) was invested in our common stock, the index, and in the peer group and its relative performance tracked through December 31, 2024. The comparisons are based on historical data and are not indicative of, nor intended to forecast, the future performance of our common stock.
The results assume that $100 (with reinvestment of all dividends) was invested in our common stock, the index, and in the peer group and its relative performance tracked through December 31, 2025. The comparisons are based on historical data and are not indicative of, nor intended to forecast, the future performance of our common stock.
Comparison of Cumulative Five Year Total Return We have presented below the cumulative total return to our stockholders of $100 during the period from December 31, 2019, through December 31, 2024, in comparison to the cumulative return on the S&P 500 Index, the Nasdaq Biotechnology Index (^NBI) and a customized peer group of five publicly traded companies during that same period.
Comparison of Cumulative Five Year Total Return We have presented below the cumulative total return to our stockholders of $100 during the period from December 31, 2020, through December 31, 2025, in comparison to the cumulative return on the S&P 500 Index, the Nasdaq Biotechnology Index (^NBI) and a customized peer group of five publicly traded companies during that same period.
The average prices listed in the above table are averages of the fair market prices at which we valued shares withheld for purposes of calculating the number of shares to be withheld. 42 Table of Contents NEOGENOMICS, INC.
The prices listed in the table above are averages of the fair market prices at which we valued shares withheld for purposes of calculating the number of shares to be withheld. 44 Table of Contents NEOGENOMICS, INC.
ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock is listed on The Nasdaq Stock Market LLC under the symbol “NEO.” Holders of Common Stock As of February 11, 2025, there were 615 stockholders of record of our common stock.
ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock is listed on The Nasdaq Stock Market LLC under the symbol “NEO.” Holders of Common Stock As of February 13, 2026, there were 519 stockholders of record of our common stock.
We intend to retain all future earnings to finance operations and future growth and, therefore, we do not anticipate paying any cash dividends in the foreseeable future. Our financing arrangements contain certain restrictions on our ability to pay dividends on our common stock.
We intend to retain all future earnings to finance operations and future growth and, therefore, we do not anticipate paying any cash dividends in the foreseeable future. Our financing arrangements contain certain restrictions on our ability to pay dividends on our common stock. Recent Sales of Unregistered Securities None.
Removed
Recent Sales of Unregistered Securities None for the year ended December 31, 2024 that have not been previously included in a Current Report on Form 8-K.
Added
The 2023 Plan replaced the Amended and Restated Equity Incentive Plan, as most recently amended on May 25, 2017 (the “Prior Plan”). Both the 2023 Plan and the Prior Plan allow participants to surrender already-owned shares having a fair market value equal to the required withholding tax related to the vesting of restricted stock.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

67 edited+27 added−20 removed33 unchanged
Biggest changeThe following is a reconciliation of GAAP net loss to Non-GAAP EBITDA and Adjusted EBITDA for the years ended December 31, 2024 and 2023 (dollars in thousands): 2024 2023 NET LOSS (GAAP) $ (78,726) $ (87,968) Adjustments to net loss: Interest income (18,427) (16,902) Interest expense 6,617 6,907 Income tax benefit (1,949) (9,129) Depreciation 39,101 37,450 Amortization of intangibles 33,446 35,133 EBITDA (non-GAAP) (19,938) (34,509) Further Adjustments to EBITDA: Non-cash stock-based compensation 33,413 24,633 Restructuring charges 6,658 11,088 IP litigation costs (1) 13,753 1,111 Other significant expenses (income), net (2) 5,722 1,163 ADJUSTED EBITDA (non-GAAP) $ 39,608 $ 3,486 51 Table of Contents NEOGENOMICS, INC. _________________ (1) For the year ended December 31, 2024, IP litigation costs include legal fees and a settlement payment.
Biggest changeThe following is a reconciliation of GAAP net loss to Non-GAAP EBITDA and Adjusted EBITDA for the years ended December 31, 2025 and 2024 (dollars in thousands): 2025 2024 NET LOSS $ (108,025) $ (78,726) Adjustments to net loss Interest income (9,070) (18,427) Interest expense 3,753 6,617 Income tax benefit (2,243) (1,949) Depreciation 36,072 39,101 Amortization of intangibles 31,752 33,446 EBITDA (non-GAAP) $ (47,761) $ (19,938) Further adjustments to EBITDA: CEO transition costs (1) 3,500 330 Acquisition and integration related expenses (2) 7,266 — Stock-based compensation 41,316 33,413 Restructuring charges — 6,658 Impairment charges (3) 27,753 — IP litigation costs (4) 11,283 13,753 Other significant expenses, net (5) — 5,392 Adjusted EBITDA (non-GAAP) $ 43,357 $ 39,608 _________________ (1) For the year ended December 31, 2025, CEO transition costs include severance costs, executive retention costs, and executive search costs.
Interest expense for the years ended December 31, 2024 and 2023 primarily reflects the effective interest rate on the 2028 Convertible Notes and the 2025 Convertible Notes which is 0.70% and 1.96%, respectively. Interest on the 2028 Convertible Notes and 2025 Convertible Notes began accruing upon issuance and is payable semi-annually.
Interest expense for the years ended December 31, 2025 and 2024 primarily reflects the effective interest rate on the 2028 Convertible Notes and the 2025 Convertible Notes which is 0.70% and 1.96%, respectively. Interest on the 2028 Convertible Notes and 2025 Convertible Notes began accruing upon issuance and is payable semi-annually.
Effects of Inflation During the years ended December 31, 2024, 2023 and 2022, inflation did not have a material effect on our business. Widely reported inflation has occurred, however, and may be ongoing for the foreseeable future. Depending on the severity and persistence of these inflationary pressures, we could experience, in the future, a negative impact on our financial results.
Effects of Inflation During the years ended December 31, 2025, 2024 and 2023, inflation did not have a material effect on our business. Widely reported inflation has occurred, however, and may be ongoing for the foreseeable future. Depending on the severity and persistence of these inflationary pressures, we could experience, in the future, a negative impact on our financial results.
We closely monitor changes in legislation and take specific actions to identify and estimate the impact of changes in legislation whenever possible as regulatory changes can affect reimbursement for clinical laboratory services. We do not anticipate significant changes to our revenue in 2025 resulting from known changes in legislation or rulemaking.
We closely monitor changes in legislation and take specific actions to identify and estimate the impact of changes in legislation whenever possible as regulatory changes can affect reimbursement for clinical laboratory services. We do not anticipate significant changes to our revenue in 2026 resulting from known changes in legislation or rulemaking.
Non-GAAP financial measures exclude certain income and/or expense items that management believes are not directly attributable to our core operating results and/or certain items that are inconsistent in amounts and frequency, making it difficult to perform a meaningful evaluation of our current or past operating performance.
Non-GAAP financial measures exclude certain income and/or expense items that management believes are not directly attributable to the Company’s core operating results and/or certain items that are inconsistent in amounts and frequency, making it difficult to perform a meaningful evaluation of our current or past operating performance.
Our commitment to connecting patients with life-altering therapies and trials remains a core focus. We have invested in leading technologies to secure data and maintain transparency and choice for patients through our Notice of Privacy Practices. 46 Table of Contents NEOGENOMICS, INC.
Our 48 Table of Contents NEOGENOMICS, INC. commitment to connecting patients with life-altering therapies and trials remains a core focus. We have invested in leading technologies to secure data and maintain transparency and choice for patients through our Notice of Privacy Practices.
This comprehensive molecular test menu allows our clients to obtain most of their molecular oncology testing needs satisfied by our laboratory. This is attractive to our clients as patient samples do not need to be split and then managed across several laboratories.
This comprehensive molecular test menu allows our clients to obtain most of their molecular oncology testing needs satisfied from our laboratory. This is attractive to our clients as patient samples do not need to be split and then managed across several laboratories.
While we anticipate an increasingly uncertain macroeconomic environment in fiscal year 2025, we will continue to mitigate through targeted pricing and various sourcing strategies. We remain optimistic about our growth opportunities in our key markets in fiscal year 2025.
While we anticipate an increasingly uncertain macroeconomic environment in fiscal year 2026, we will continue to mitigate through targeted pricing and various sourcing strategies. We remain optimistic about our growth opportunities in our key markets in fiscal year 2026.
The acquisition of Inivata in June 2021 enhanced our capabilities with oncology liquid biopsy technology including RaDaR® which is designed to detect residual disease and recurrence in plasma samples from patients with solid tumor malignancies. These molecular laboratory and NGS capabilities are expected to drive growth in the coming years.
The acquisition of Inivata in June 2021 enhanced our capabilities with oncology liquid biopsy technology including RaDaR®, which is designed to detect MRD and recurrence in plasma samples from patients with solid tumor malignancies. These molecular laboratory and NGS capabilities are expected to drive growth in the coming years.
We believe lower cost and increased value of testing is extremely important to the healthcare industry and creates a competitive advantage. We will invest in information technology, automation and best practices to continually improve our processes and drive down the cost of testing.
We believe increased value of testing and lower cost is extremely important to the healthcare industry and creates a competitive advantage. We expect to continue to invest in information technology, automation and best practices to continually improve our processes and drive down the cost of testing.
GAAP financial results, should not be considered measures of liquidity, and are unlikely to be comparable to non-GAAP financial measures used by other companies.
GAAP financial results, should not be considered measures of liquidity, and are unlikely to be comparable to non-GAAP financial measures provided by other companies.
This integration aligns with our broader service offerings to provide seamless, comprehensive support for both clinical and pharmaceutical clients. Strategic Focus By streamlining our segments, we aim to provide a seamless and integrated service offering to our clients. This approach allows us to leverage our expertise in oncology and molecular diagnostics to support both clinical and pharmaceutical clients more effectively.
This integration aligns with our broader service offerings to provide seamless, comprehensive support for both clinical and pharmaceutical clients. Strategic Focus We aim to provide a seamless and integrated service offering to our clients. Our operating approach allows us to leverage our expertise in oncology and molecular diagnostics to support both clinical and pharmaceutical clients more effectively.
Additionally, we enter into contracts to provide pharmaceutical development services and oncology data solutions. Revenue is recorded on a unit-of-service basis based on the number of units completed towards the satisfaction of a performance obligation. 47 Table of Contents NEOGENOMICS, INC. Services are billed to various payers, including client direct billing, commercial insurance, Medicare and other government payers, and patients.
Additionally, we enter into contracts to provide pharmaceutical development services and oncology data solutions. Revenue is recorded on a unit-of-service basis based on the number of units completed towards the satisfaction of a performance obligation. Services are billed to various payers, including client direct billing, commercial insurance, Medicare and other government payers, and patients.
Our Company NeoGenomics, Inc., a Nevada corporation (the “Company,” or “NeoGenomics”), and its subsidiaries provide a wide range of oncology diagnostic testing and consultative services which includes technical laboratory services and professional interpretation of laboratory test results by licensed physicians who specialize in pathology and oncology.
Our Company NeoGenomics, Inc., a Nevada corporation (the “Company,” or “NeoGenomics”), and its subsidiaries provide a wide range of oncology diagnostic testing and consultative services, including technical laboratory services and professional interpretation of laboratory test results by licensed physicians or molecular experts who specialize in pathology and oncology.
For discussion and analysis pertaining to 2023 overview and highlights as compared to 2022, please refer to the Company’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission (“SEC”) on February 20, 2024.
For discussion and analysis pertaining to 2024 overview and highlights as compared to 2023, please refer to the Company’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission (“SEC”) on February 18, 2025.
As a leading global oncology diagnostics company serving biopharmaceutical companies as well as practicing oncologists and pathologists, NeoGenomics facilitates the adoption of these advanced oncology diagnostic tools beyond the academic environment into the community setting.
As a leading provider of oncology diagnostics solutions serving practicing oncologists and pathologists as well as biopharmaceutical companies, NeoGenomics facilitates the adoption of these advanced oncology diagnostic tools beyond the academic environment into the community setting.
Revenue Recognition and Accounts Receivable Our specialized clinical services are performed based on an online test order or a written test requisition form. The performance obligation is satisfied and revenues are recognized once the clinical services have been performed and the results have been delivered to the ordering physician.
Revenue Recognition and Accounts Receivable Our specialized clinical services are performed based on an online test order or a written test requisition form. The performance obligation is satisfied and revenues are recognized once the clinical services have been performed and the 49 Table of Contents NEOGENOMICS, INC. results have been delivered to the ordering physician.
We will continue to expand our test menu and expect to remain at the forefront of the ongoing revolution in cancer related genetic and molecular testing to achieve our vision of becoming one of the world’s leading cancer testing and information companies.
We are also continuing to expand our test menu and expect to remain at the forefront of the ongoing revolution in cancer related genetic and molecular testing to achieve our vision of becoming one of the world’s leading cancer testing and information companies.
We currently anticipate that our capital expenditures for the year ended December 31, 2025, will be in the range of $30 million to $35 million. During the year ended December 31, 2024, we purchased, with cash, approximately $41.1 million of capital equipment, software, and leasehold improvements.
We currently anticipate that our capital expenditures for the year ended December 31, 2026, will be in the range of $30 million to $35 million. During the year ended December 31, 2025, we purchased, with cash, approximately $27.0 million of capital equipment, software, and leasehold improvements.
The FDA issued a policy to phase out, over the course of four years, its general enforcement discretion approach to LDTs and also issued targeted enforcement discretion policies for certain categories of LDTs.
As part of that final rule, the FDA issued a policy to phase out, over the course of four years, its general enforcement discretion approach to LDTs and also issued targeted enforcement discretion policies for certain categories of LDTs.
On April 29, 2024, the FDA announced a final rule on the regulation of Laboratory Developed Tests (“LDTs”) which amends the FDA's regulations to make explicit that LDT's are devices under the Federal Food, Drug, and Cosmetic Act (“FD&C Act”).
On May 6, 2024, the FDA published a final rule on the regulation of Laboratory Developed Tests (“LDTs”) which amended the FDA's regulations to make explicit that LDT's are devices under the Federal Food, Drug, and Cosmetic Act (“FD&C Act”).
Definitions of Non-GAAP Measures Non-GAAP Adjusted EBITDA “Adjusted EBITDA” is defined by NeoGenomics as net (loss) income from continuing operations before: (i) interest income, (ii) interest expense, (iii) tax (benefit) or expense, (iv) depreciation and amortization expense, (v) stock-based compensation expense, and, if applicable in a reporting period, (vi) restructuring charges, (vii) intellectual property (“IP”) litigation costs, and (viii) other significant or non-operating (income) or expenses, net.
Definitions of Non-GAAP Financial Measures Non-GAAP Adjusted EBITDA “Adjusted EBITDA” is defined by NeoGenomics as net (loss) income from continuing operations before: (i) interest income, (ii) interest expense, (iii) tax (benefit) or expense, (iv) depreciation and amortization expense, (v) stock-based compensation expense, and, if applicable in a reporting period, (vi) CEO transition costs, (vii) acquisition and integration related expenses, (viii) restructuring charges, (ix) impairment charges, (x) intellectual property (“IP”) litigation costs, and (xi) other significant or non-operating (income) or expenses, net. 53 Table of Contents NEOGENOMICS, INC.
Management believes that the presentation of operating results using non-GAAP financial measures provides useful supplemental information to investors by facilitating the analysis of our core test-level operating results across reporting periods and when comparing those same results to those published by our peers. These non-GAAP financial measures may also assist investors in evaluating future prospects.
Management believes that the presentation of operating results using non-GAAP financial measures provides useful supplemental information to investors by facilitating the analysis of the Company’s core test-level operating results across reporting periods. These non-GAAP financial measures may also assist investors in evaluating future prospects.
This $9.0 million increase was primarily driven by our operating results (net loss adjusted for depreciation, amortization of intangibles, and other non-cash charges) which resulted in $16.1 million of lower cash used by operating activities year-over-year, as well as a $7.1 million decrease in cash used resulting from net changes in operating assets and liabilities.
This $1.8 million decrease was primarily driven by our operating results (net loss adjusted for depreciation, amortization of intangibles, and other non-cash charges) which resulted in $2.3 million of higher cash used by operating activities year-over-year, as well as a $0.5 million decrease in cash used resulting from net changes in operating assets and liabilities.
Restructuring charges Consolidated restructuring charges for the years ended December 31, 2024 and 2023 are as follows (dollars in thousands): 2024 2023 $ Change % Change Restructuring charges $ 6,658 $ 11,088 $ (4,430) (40.0) % Restructuring charges as a percentage of revenue 1.0 % 2.0 % Restructuring charges relate to a restructuring program to improve execution and drive efficiency across the organization.
Restructuring Charges Consolidated restructuring charges for the years ended December 31, 2025 and 2024 are as follows (dollars in thousands): 2025 2024 $ Change % Change Restructuring charges $ — $ 6,658 $ (6,658) (100.0) % Restructuring charges as a percentage of revenue — % 1.0 % Restructuring charges relate to a restructuring program to improve execution and drive efficiency across the organization.
Net Loss The following table provides the net loss for the years ended December 31, 2024 and 2023, along with the computation of basic and diluted net loss per share (in thousands, except per share amounts): 2024 2023 Net loss $ (78,726) $ (87,968) Basic weighted average shares outstanding 126,658 125,502 Diluted weighted average shares outstanding 126,658 125,502 Basic net loss per share $ (0.62) $ (0.70) Diluted net loss per share $ (0.62) $ (0.70) Non-GAAP Measures Use of Non-GAAP Financial Measures In order to provide greater transparency regarding our operating performance, the financial results and financial guidance include the use of certain non-GAAP financial measures that involve adjustments to GAAP results.
Net Loss The following table provides the net loss for the years ended December 31, 2025 and 2024, along with the computation of basic and diluted net loss per share (in thousands, except per share amounts): 2025 2024 NET LOSS $ (108,025) $ (78,726) Basic weighted average shares outstanding 128,101 126,658 Diluted weighted average shares outstanding 128,101 126,658 Basic net loss per share $ (0.84) $ (0.62) Diluted net loss per share $ (0.84) $ (0.62) Non-GAAP Financial Measures Use of Non-GAAP Financial Measures In order to provide greater transparency regarding our operating performance, the financial results and financial guidance in this press release refer to certain non-GAAP financial measures that involve adjustments to GAAP results.
Moreover, our team of MDs and PhDs, along with our highly-trained oncology-focused sales team, provides ongoing education to our clients to ensure that they remain abreast of cutting-edge developments in oncology. We are a leading provider of oncology-diagnostic services to biopharma companies.
Moreover, our team of MDs and PhDs, along with our highly-trained oncology-focused sales team, provides ongoing education to our clients to ensure that they remain abreast of cutting-edge developments in oncology.
Related Party Transactions, to our Consolidated Financial Statements for a description of our related party transactions. Capital Expenditures We forecast capital expenditures in order to execute on our business plan and maintain growth; however, the actual amount and timing of such capital expenditures will ultimately be determined by the volume of business.
Capital Expenditures We forecast capital expenditures in order to execute on our business plan and maintain growth; however, the actual amount and timing of such capital expenditures will ultimately be determined by the volume of business.
The revenue streams include: • Clinical cancer testing; • Interpretation and consultative services; • Molecular and NGS testing; • Comprehensive technical and professional services offering; • Clinical trials and research; • Validation laboratory services; and • Oncology data solutions.
Revenue Streams Our revenue streams include: • Clinical cancer testing; • Interpretation and consultative services; • Molecular and NGS testing; • MRD testing; • Comprehensive technical and professional services offering; • Clinical trials and research; • Validation laboratory services; and • Oncology data solutions. 47 Table of Contents NEOGENOMICS, INC.
The consolidated cost of revenue and gross profit metrics for the years ended December 31, 2024 and 2023 are as follows (dollars in thousands): 2024 2023 % Change Cost of revenue: Cost of revenue (1) $ 370,466 $ 347,039 6.8 % Cost of revenue as a percentage of revenue 56.1 % 58.7 % Gross Profit: Gross profit $ 290,100 $ 244,604 18.6 % Gross profit margin 43.9 % 41.3 % _________________ (1) Cost of revenue for the twelve months ended December 31, 2024 includes $19.6 million of amortization of acquired intangible assets and $1.4 million of stock-based compensation.
The consolidated cost of revenue and gross profit metrics for the years ended December 31, 2025 and 2024 are as follows (dollars in thousands): 2025 2024 % Change Cost of revenue: Cost of revenue (1) $ 413,039 $ 370,466 11.5 % Cost of revenue as a percentage of revenue 56.8 % 56.1 % Gross Profit: Gross profit $ 314,293 $ 290,100 8.3 % Gross profit margin 43.2 % 43.9 % _________________ (1) Cost of revenue for the year ended December 31, 2025 includes $18.9 million of amortization of acquired intangible assets and $1.4 million of stock-based compensation.
This decision aims to streamline our operations and enhance our service offerings to our diverse client base, which includes community-based pathology and oncology practices, hospital pathology labs, reference labs, academic centers, and pharmaceutical companies. Revenue Streams Our single operating segment now encompasses a comprehensive range of services previously categorized under Clinical Services and Advanced Diagnostics.
Reportable Segment We operate under a single segment that encompasses a comprehensive range of services. This approach aims to streamline our operations and enhance our service offerings to our diverse client base, which includes community-based pathology and oncology practices, hospital pathology labs, reference labs, academic centers, and pharmaceutical companies.
This approach captures a full spectrum of genomic alterations, including mutations, fusions, copy number variations, and splicing mutations, as well as tumor mutation burden (TMB) and microsatellite instability (MSI) for solid tumors. These tests are complemented by IHC and FISH tests when necessary.
Additionally, we have molecular-only and comprehensive NGS-targeted panels which combine DNA and RNA into a single workflow. This approach captures a full spectrum of genomic alterations, including mutations, fusions, copy number variations, and splicing mutations, as well as tumor mutation burden (TMB) and microsatellite instability (MSI) for solid tumors. These tests are complemented by IHC and FISH tests when necessary.
Consolidated research and development expense for the years ended December 31, 2024 and 2023 are as follows (dollars in thousands): 2024 2023 $ Change % Change Research and development $ 31,159 $ 27,309 $ 3,850 14.1 % Research and development as a percentage of revenue 4.7 % 4.6 % Research and development expenses increased $3.9 million in 2024 compared to 2023.
Consolidated research and development expense for the years ended December 31, 2025 and 2024 are as follows (dollars in thousands): 2025 2024 $ Change % Change Research and development $ 37,077 $ 31,159 $ 5,918 19.0 % Research and development as a percentage of revenue 5.1 % 4.7 % Research and development expenses increased $5.9 million in 2025 compared to 2024.
On October 1, 2024, we performed a qualitative assessment to determine whether it was more likely than not that the fair values of our reporting units were less than their carrying values.
During the fourth quarter of 2025, we performed an updated qualitative assessment to determine whether it was more likely than not that the fair values of our reporting units were less than their carrying values.
Cash Flows from Operating Activities Cash provided by in operating activities during the year ended December 31, 2024, was $7.0 million compared to cash used of $2.0 million in the same period in 2023.
(1) Defined as current assets less current liabilities. Cash Flows from Operating Activities Cash provided by operating activities during the year ended December 31, 2025, was $5.2 million compared to cash provided of $7.0 million in the same period in 2024.
Service Offerings Our clinical cancer testing services are designed to complement the work of community-based pathologists and oncologists, allowing them to expand their testing capabilities without significant investment in new technology or personnel.
Service Offerings Our clinical cancer testing services are designed to complement the work of community-based pathologists and oncologists, allowing them to expand their testing capabilities without significant investment in new technology or personnel. We offer both technical component (“TC” or “tech-only”) and professional component (“PC”) services, enabling our clients to participate in the diagnostic process.
Consolidated cost of revenue increased $23.4 million for the year ended December 31, 2024 when compared to the same period in 2023 primarily due to $15.5 million in higher compensation and benefit costs, an increase in supplies expense of $6.9 million, and an increase in professional fees of $0.9 million, partially offset by a decrease in technology and equipment fees of $0.6 million.
Consolidated cost of revenue increased $42.6 million for the year ended December 31, 2025 when compared to the same period in 2024 primarily due to $23.3 million in higher compensation and benefit costs, an increase in supplies expense of $16.7 million, and an increase in postage and shipping costs of $2.6 million, partially offset by a decrease in depreciation of $3.9 million.
Operating needs include, but are not limited to, the planned costs to operate our business, including amounts required to fund working capital including the convertible senior notes due 2025, capital expenditures, continued research and development efforts, and potential strategic acquisitions and investments. 52 Table of Contents NEOGENOMICS, INC. Related Party Transactions Please refer to Note 15.
Operating needs include, but are not limited to, the planned costs to operate our business, including amounts required to fund working capital, capital expenditures, continued research and development efforts, and potential strategic acquisitions and investments. Related Party Transactions Please refer to Note 16. Related Party Transactions, to our Consolidated Financial Statements for a description of our related party transactions.
Consolidated general and administrative expenses for the years ended December 31, 2024 and 2023 are as follows (dollars in thousands): 2024 2023 $ Change % Change General and administrative $ 259,737 $ 243,101 $ 16,636 6.8 % General and administrative as a percentage of revenue 39.3 % 41.1 % General and administrative expenses increased $16.6 million in 2024 compared to 2023.
Consolidated general and administrative expenses for the years ended December 31, 2025 and 2024 are as follows (dollars in thousands): 2025 2024 $ Change % Change General and administrative $ 273,337 $ 259,737 $ 13,600 5.2 % General and administrative as a percentage of revenue 37.6 % 39.3 % General and administrative expenses increased $13.6 million in 2025 compared to 2024.
For the year ended December 31, 2023, IP litigation costs include legal fees. (2) For the year ended December 31, 2024, other significant (income) expenses, net, includes CEO transition costs, site closure costs, severance costs, and fees related to non-recurring legal matters.
(5) For the year ended December 31, 2024, other significant (income) expenses, net, includes site closure costs, severance costs, and fees related to non-recurring legal matters. There we no such costs for the year ended December 31, 2025.
Gross profit margin for 2024 was 43.9% compared to 41.3% in 2023. This 2.6% increase is primarily related to increases in revenue partially offset by higher compensation and benefits costs and supplies expense.
Gross profit margin for 2025 was 43.2% compared to 43.9% in 2024. This 0.7% decrease is primarily related to the acquisition of Pathline as well as higher compensation and benefits costs and supplies expense partially offset by increases in revenue.
Cost of revenue for the twelve months ended December 31, 2023 includes $19.6 million of amortization of acquired intangible assets. There were no stock-based compensation amounts recorded for the year ended December 31, 2023. 48 Table of Contents NEOGENOMICS, INC.
Cost of revenue for the year ended December 31, 2024 includes $19.6 million of amortization 50 Table of Contents NEOGENOMICS, INC. of acquired intangible assets and $1.4 million of stock-based compensation.
Restructuring charges consist of severance and other employee costs, costs for optimizing the Company’s geographic presence, and consulting and other costs. Restructuring charges decreased $4.4 million in 2024 compared to 2023. Restructuring charges in 2024 consist of $1.5 million in severance and other employee costs, $4.1 million in Facility Footprint Optimization costs, and $1.0 million of consulting and other costs.
Restructuring charges consist of severance and other employee costs, costs for optimizing the Company’s geographic presence, and consulting and other costs. Restructuring charges decreased $6.7 million in 2025 compared to 2024 due to the completion of the restructuring program in 2024.
The following table presents a summary of our consolidated cash flows for operating, investing, and financing activities for the years ended December 31, 2024 and 2023, as well as the period ending cash and cash equivalents and working capital (in thousands): 2024 2023 Net cash (used in) provided by: Operating activities $ 7,023 $ (1,953) Investing activities 12,855 76,707 Financing activities 4,646 4,554 Net change in cash and cash equivalents 24,524 79,308 Cash, cash equivalents and restricted cash, beginning of year 342,488 263,180 Cash and cash equivalents, end of year $ 367,012 $ 342,488 Working Capital, (1) end of period $ 294,778 $ 500,508 _________________ (1) Defined as current assets less current liabilities.
The following table presents a summary of our consolidated cash flows for operating, investing and financing activities for the years ended December 31, 2025 and 2024, as well as balances of cash and cash equivalents and working capital: 2025 2024 Net cash (used in) provided by: Operating activities $ 5,230 $ 7,023 Investing activities (12,336) 12,855 Financing activities (200,288) 4,646 Net change in cash and cash equivalents (207,394) 24,524 Cash, cash equivalents and restricted cash, beginning of year 367,012 342,488 Cash and cash equivalents, end of year $ 159,618 $ 367,012 Working Capital, (1) end of period $ 287,986 $ 294,778 _________________ 54 Table of Contents NEOGENOMICS, INC.
Consolidated sales and marketing expenses for the years ended December 31, 2024 and 2023, are as follows (dollars in thousands): 2024 2023 $ Change % Change Sales and marketing $ 84,652 $ 70,842 $ 13,810 19.5 % Sales and marketing as a percentage of revenue 12.8 % 12.0 % 49 Table of Contents NEOGENOMICS, INC.
Consolidated sales and marketing expenses for the years ended December 31, 2025 and 2024, are as follows (dollars in thousands): 51 Table of Contents NEOGENOMICS, INC. 2025 2024 $ Change % Change Sales and marketing $ 92,007 $ 84,652 $ 7,355 8.7 % Sales and marketing as a percentage of revenue 12.6 % 12.8 % Sales and marketing expenses increased $7.4 million in 2025 compared to 2024.
These increases in general and administrative expenses for the year ended December 31, 2024 were partially offset by a decrease in amortization of $1.7 million, and a decrease in credit card fees of $1.0 million.
These increases in general and administrative expenses for the year ended December 31, 2025 were partially offset by a decrease in legal and other professional fees of $2.1 million, a decrease in equipment maintenance costs of $1.8 million, a decrease in travel costs of $1.3 million, a decrease in amortization of $1.0 million, and a decrease in facilities related expenses of $0.5 million.
These decreases were partially offset by a $12.3 million increase in purchases of property and equipment year-over-year. Cash Flows from Financing Activities During the year ended December 31, 2024, cash provided by financing activities was $4.6 million compared to $4.6 million for the same period in 2023.
Cash Flows from Financing Activities During the year ended December 31, 2025, cash used in financing activities was $200.3 million compared to cash provided of $4.6 million for the same period in 2024.
We anticipate that the cash on hand, marketable securities, and cash collections are sufficient to fund our near-term capital and operating needs for at least the next 12 months.
Liquidity Outlook As of December 31, 2025, we had $159.6 million in cash and cash equivalents to support current operational liquidity needs. We anticipate that the cash on hand and cash collections are sufficient to fund our near-term capital, and operating needs for at least the next 12 months.
Sales and marketing expenses increased $13.8 million in 2024 compared to 2023. The increase primarily reflects increases in compensation and benefit costs due to increased headcount, an increase in sales commissions, and an increase in travel. We expect higher commissions expense in the coming quarters as we expand our sales representative force and our sales representatives generate new business.
The increase primarily reflects an increase in compensation and benefit costs of $4.3 million, an increase in consulting and other professional fees of $1.3 million, and an increase in travel costs of $0.4 million. We expect higher commissions expense in the coming quarters as we expand our sales representative force and our sales representatives generate new business.
We believe our relationship as a non-competitive partner to community-based pathology practices, hospital pathology labs, reference labs, and academic centers empowers them to expand their breadth of testing. We believe this enables them to provide a menu of services that could match or exceed the level of service found in any center of excellence around the world.
We believe this enables them to provide a menu of services that could match or exceed the level of service found in any center of excellence around the world.
Cash Flows from Investing Activities During the year ended December 31, 2024, cash provided by investing activities was $12.9 million, compared to $76.7 million for the same period in 2023. This change was due to a $6.8 million decrease in purchases of marketable securities and a $58.3 million decrease in the sales and maturities of marketable securities year-over-year.
Cash Flows from Investing Activities During the year ended December 31, 2025, cash used in investing activities was $12.3 million, compared to cash provided of $12.9 million for the same period in 2024.
The following table reflects our estimate of the breakdown of net revenue by type of payer for the years ended December 31, 2024, 2023 and 2022: 2024 2023 2022 Client direct billing 72 % 72 % 73 % Commercial insurance 15 % 15 % 14 % Medicare and other government 13 % 13 % 13 % Self-pay — % — % — % Total 100 % 100 % 100 % Results of Operations for the year ended December 31, 2024 as compared with the year ended December 31, 2023 Revenue The Company has historically reported its activities in two reportable segments, (1) Clinical Services and (2) Advanced Diagnostics.
The following table reflects our estimate of the breakdown of net revenue by type of payer for the years ended December 31, 2025, 2024 and 2023: 2025 2024 2023 Client direct billing 71 % 72 % 72 % Commercial insurance 16 % 15 % 15 % Medicare and other government 13 % 13 % 13 % Self-pay — % — % — % Total 100 % 100 % 100 % Results of Operations for the year ended December 31, 2025 as compared with the year ended December 31, 2024 Revenue The consolidated revenue for the years ended December 31, 2025 and 2024, are as follows (dollars in thousands): 2025 2024 % Change Net revenue $ 727,332 $ 660,566 10.1 % Revenue in 2025 increased $66.8 million, or 10.1%, as compared to 2024.
For the year ended December 31, 2023, other significant (income) expenses, net, fees related to a regulatory matter, CEO transition costs and other non-recurring items. Liquidity and Capital Resources To date, we have financed our operations primarily through cash generated from operations, public and private sales of debt and equity securities, and bank debt borrowings.
Liquidity and Capital Resources To date, we have financed our operations primarily through cash generated from operations, public and private sales of debt and equity securities, and bank debt borrowings.
Fair Value Measurements in the accompanying notes to the Consolidated Financial Statements. Interest Expense Interest expense for the years ended December 31, 2024 and 2023 is as follows (dollars in thousands): 2024 2023 $ Change % Change Interest expense $ 6,617 $ 6,907 $ (290) (4.2) % Interest expense decreased $0.3 million in 2024 compared to 2023.
Goodwill and Intangible Assets in the accompanying notes to the Consolidated Financial Statements. Interest Income Interest income for the years ended December 31, 2025 and 2024 is as follows (dollars in thousands): 2025 2024 $ Change % Change Interest income $ 9,070 $ 18,427 $ (9,357) (50.8) % Interest income decreased $9.4 million in 2025 compared to 2024.
This increase was partially due to an increase in legal and other professional fees of $8.3 million, an increase in compensation and benefit costs of $7.2 million, and an increase in depreciation of $1.6 million.
This increase was partially due to an increase in compensation and benefit costs of $11.5 million, increased software development and other technology costs of $8.0 million, and an increase in transaction costs of $1.4 million.
Sales and Marketing Expenses Sales and marketing expenses are primarily attributable to employee-related costs including sales management, sales representatives, sales and marketing consultants, marketing and client service personnel, and stock-based compensation.
We anticipate research and development expenditures will increase in the future as we continue to invest in development activities for innovation projects and bringing new tests to market. Sales and Marketing Expenses Sales and marketing expenses are primarily attributable to employee-related costs including sales management, sales representatives, sales and marketing consultants, marketing and client service personnel, and stock-based compensation.
Interest income includes interest earned on funds held in our cash equivalent and marketable securities accounts. The increase in interest income in 2024 was due to the higher interest rate environment experienced when compared to the same period in 2023. For further details regarding our investments in marketable securities, please refer to Note 3.
Interest income includes interest earned on funds held in our cash equivalent and marketable securities accounts. The decrease in interest income in 2025 was primarily due to a reduction in the average balance of invested cash and a lower interest rate environment when compared to the same periods in 2024.
For further details regarding the convertible notes please refer to Note 7. Debt in the accompanying notes to the Consolidated Financial Statements. 50 Table of Contents NEOGENOMICS, INC.
These decreases are primarily attributable to the maturity and settlement of the Company's 2025 Convertible Notes during the second quarter of 2025. For further details regarding the convertible notes please refer to Note 8. Debt in the accompanying notes to the Consolidated Financial Statements.
These comprehensive panels can allow for faster treatment decisions for patients as compared to a series of single-gene molecular tests being ordered sequentially. Our broad molecular testing menu includes NeoTYPE and Neo Comprehensive panels which target genes relevant to a particular cancer type. Additionally, we have molecular-only and comprehensive NGS-targeted panels which combine DNA and RNA into a single workflow.
These comprehensive panels can allow for faster treatment decisions for patients as compared to a series of single-gene molecular tests being ordered sequentially.
Enhance Our People and Culture • Enhance our Neo Culture; and • Expand scientific, medical and product capabilities. 44 Table of Contents NEOGENOMICS, INC. These critical success factors have been communicated throughout our Company. We have structured departmental goals around these factors and have created employee incentive plans in which every employee will have a meaningful incentive for our success.
We have structured departmental goals around these factors and have created employee incentive plans in which every employee will have a meaningful incentive for our success. 46 Table of Contents NEOGENOMICS, INC. Regulatory Environment The FDA has regulatory responsibility over instruments, test kits, reagents, and other medical devices used by clinical laboratories to perform diagnostic testing.
The Company operates a network of cancer-focused testing laboratories in the United States and the United Kingdom. 43 Table of Contents NEOGENOMICS, INC. 2024 Overview and Highlights • We increased revenue by 11.6% compared to 2023; • Net cash used in operations improved $9.0 million compared to 2023; • We increased Adjusted EBITDA $36.1 million to positive $39.6 million compared to 2023; and • We improved gross margin by 259 basis points while also improving turnaround time.
The Company operates a network of cancer-focused testing laboratories in the United States and the United Kingdom. 45 Table of Contents NEOGENOMICS, INC. 2025 Overview and Highlights • We increased revenue by 10.1% compared to 2024; • We increased Adjusted EBITDA 9.5% or $3.7 million to positive $43.4 million compared to 2024; • We completed the acquisition of Pathline in April 2025; and • We successfully resolved the RaDaR ST patent litigation with no remaining claims pending against the Company in December 2025.
We aim to help clients discover the right content, refine biomarker strategies, and develop effective pathways for clinical trial testing.
NeoGenomics does not sponsor, conduct, or control clinical trials, and sponsors retain responsibility for study design, regulatory submissions, trial conduct, and clinical decision-making. These services provide comprehensive support in oncology programs, including biomarker discovery, study design, and clinical trial testing. We aim to help clients discover the right content, refine biomarker strategies, and develop effective pathways for clinical trial testing.
Interest Income Interest income for the years ended December 31, 2024 and 2023 is as follows (dollars in thousands): 2024 2023 $ Change % Change Interest income $ (18,427) $ (16,902) $ (1,525) 9.0 % Interest income increased $1.5 million in 2024 compared to 2023.
Interest Expense Interest expense for the years ended December 31, 2025 and 2024 is as follows (dollars in thousands): 52 Table of Contents NEOGENOMICS, INC. 2025 2024 $ Change % Change Interest expense $ 3,753 $ 6,617 $ (2,864) (43.3) % Interest expense decreased $2.9 million in 2025 compared to 2024.
This increase is primarily due to increases in professional fees, a decrease in research and development tax credits from the UK government and an increase in compensation and benefits costs. We anticipate research and development expenditures will increase in the future as we continue to invest in development activities for innovation projects and bringing new tests to market.
This increase is primarily due to an increase in compensation and benefits costs of $2.2 million, an increase in supplies expense of $1.7 million, an increase in software support and other technology costs of $0.3 million, and a decrease in research and development tax credits from the UK government of $1.2 million.
The cash provided by financing activities during the year ended December 31, 2024 consisted of $4.6 million for the issuance of common stock net of issuance costs. Liquidity Outlook As of December 31, 2024, we had $367.0 million in cash and cash equivalents in addition to $19.8 million of marketable securities available to support current operational liquidity needs.
The cash used in financing activities during the year ended December 31, 2025 consisted of $201.3 million for the repayment of the 2025 Convertible Notes, partially offset by cash provided of $1.0 million for the issuance of common stock net of issuance costs.
In 2024, we simplified our operational approach, bringing Clinical Services and Advanced Diagnostics under a single segment. The consolidated revenue for the years ended December 31, 2024 and 2023, are as follows (dollars in thousands): 2024 2023 % Change Net revenue $ 660,566 $ 591,643 11.6 % Revenue in 2024 increased $68.9 million, or 11.6%, as compared to 2023.
Impairment Charges Consolidated impairment charges for the years ended December 31, 2025 and 2024 are as follows (dollars in thousands): 2025 2024 $ Change % Change Impairment charges $ 27,753 $ — $ 27,753 NM (2) Impairment charges as a percentage of revenue 3.8 % — % _________________ (2) NM - Not meaningful Impairment charges increased $27.8 million in 2025 compared to 2024.
We offer 45 Table of Contents NEOGENOMICS, INC. both technical component (“TC” or “tech-only”) and professional component (“PC”) services, enabling our clients to participate in the diagnostic process. These services are designed to be a natural extension of, and complementary to, the services that clients perform within their own practices.
These services are designed to be a natural extension of, and complementary to, the services that clients perform within their own practices. We believe our relationship as a non-competitive partner to community-based pathology practices, hospital pathology labs, reference labs, and academic centers empowers them to expand their breadth of testing.
Removed
We will continue to work with these clients across the drug development continuum—from research and development through clinical trials testing—to commercialization of companion diagnostic tests.
Added
We are a leading provider of Heme oncology diagnostic testing, which includes molecular and NGS testing, and one of the key providers of solid tumor NGS testing solutions in the United States.
Removed
We expect to continue to grow our business through (i) expansion of our test offerings (including leading edge NGS tools such as WES, WGS, and others), and (ii) our unique capabilities for developing and commercializing companion diagnostic tests.
Added
Additionally, we are a trusted provider of specialized pharmaceutical development services, supporting pharmaceutical firms through the provision of laboratory testing, biomarker analysis, data generation, and related scientific support services in connection with sponsor-led research studies and clinical trials.
Removed
We are continuing to develop and broaden our oncology data solutions to leverage our strategic market position and oncology expertise to help our stakeholders solve real-world problems such as identifying patients for clinical trials or providing clinical decision support tools for physicians and providers. We are committed to connecting patients with life-altering therapies and trials.
Added
We expect to continue to grow our business by offering a broad portfolio of tests with rapid turnaround times, wrap-around services, and solutions targeted to hospitals and community oncology segments. We believe that our exclusive focus on oncology, enabled by our expansive oncology testing menu and our high level of service, will further enhance our efforts.
Removed
In carrying out these commitments, NeoGenomics aims to provide transparency and choice to patients regarding the handling and use of their data through our Notice of Privacy Practices, and has invested in leading technologies to help ensure the data we maintain is secured at all times.
Added
Our focus for 2026 is to sustain a purpose driven culture that maintains excellence in service and performance while growing through targeted innovation and to further extend our market relevance in the areas of therapy selection and MRD.
Removed
We continue to develop our company-wide focus, which includes the following four critical success factors for 2025: Profitably Grow Our Core Business • Accelerate volume growth; both through the traditional clinical and NGS modalities; • Accelerate growth with oncologists in the community; and • Execute pharmaceutical client strategy and deliver profitable revenue growth.
Added
We expect the following initiatives to allow the Company to continue on its path to becoming one of the world’s leading comprehensive cancer testing companies catering primarily to patients receiving their care in the community setting: Next Generation Precision Diagnostic Testing Solutions • Drive targeted product launches in therapy selection and MRD through our launch excellence program; and • Execute on focused investment programs in solid tumor Next Generation MRD assay targeting ultra-sensitive testing.
Removed
Accelerate Innovation • Deliver 3-year product roadmaps; • Execute successful timely-planned product launch(es); and • Drive productization and sales excellence for Data Solutions. Drive Value Creation • Improve operational efficiency and gross margin; • Transform Neo’s digital ecosystem; and • Achieve positive cash flow from operations.
Added
Our Community Channel Strength • Continue purposeful expansion into the community oncology market, leveraging the strategic position that we've established with community hospitals; and • Deliberately leverage partnerships to expand our market presence and accelerate our topline growth.
Removed
Regulatory Environment The FDA is currently considering changes that may include increased regulation of LDTs by the FDA. In October 2014 the FDA announced its proposed framework and timetable and indicated it would move toward greater oversight of LDTs. The FDA has not finalized the framework they announced in 2014.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

5 edited+0 added−5 removed0 unchanged
Biggest changeWe carry the 2025 Convertible Notes and 2028 Convertible Notes at face value less unamortized debt discount and debt issuance costs on our balance sheet, and we present the fair value for required disclosure purposes only. The primary objective of our investment activities is to preserve principal while at the same time maximizing yields without significantly increasing risk.
Biggest changeWe carry the 2028 Convertible Notes at face value less unamortized debt discount and debt issuance costs on our balance sheet, and we present the fair value for required disclosure purposes only. Foreign Currency Exchange Risk We have operations in Cambridge, United Kingdom.
Our international revenues and expenses denominated in foreign currencies (primarily British Pounds), expose us to the risk of fluctuations in foreign currency exchange rates against the U.S. dollar. We do not hedge foreign currency exchange risks and do not currently believe that these risks are significant. 53 Table of Contents NEOGENOMICS, INC.
Our international revenues and expenses denominated in foreign currencies (primarily British Pounds), expose us to the risk of fluctuations in foreign currency exchange rates against the U.S. dollar. We do not hedge foreign currency exchange risks and do not currently believe that these risks are significant. 56 Table of Contents NEOGENOMICS, INC.
Generally, the fair market value will increase as interest rates fall and decrease as interest rates rise. In addition, the fair value is affected by our common stock price. The fair value will generally increase as our common stock price increases and will generally decrease as our common stock price declines.
In addition, the fair value is affected by our common stock price. The fair value will generally increase as our common stock price increases and will generally decrease as our common stock price declines.
The 2028 Convertible Notes have a fixed annual interest rate of 0.25%; therefore, we do not have economic interest rate exposure with respect to the 2028 Convertible Notes. However, the fair value of the 2025 Convertible Notes and 2028 Convertible Notes is exposed to interest rate risk.
The 2028 Convertible Notes have a fixed annual interest rate of 0.25%; therefore, we do not have economic interest rate exposure with respect to the 2028 Convertible Notes. However, the fair value of the 2028 Convertible Notes is exposed to interest rate risk. Generally, the fair market value will increase as interest rates fall and decrease as interest rates rise.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We are exposed to market risks, including changes in foreign currency exchange rates. Interest Rate Risk In May 2020, we issued $201.3 million aggregate principal amount of the 2025 Convertible Notes.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We are exposed to market risks, including changes in foreign currency exchange rates. Interest Rate Risk 55 Table of Contents NEOGENOMICS, INC. In January 2021, we issued $345.0 million aggregate principal amount of the 2028 Convertible Notes.
Removed
The 2025 Convertible Notes have a fixed annual interest rate of 1.25%; therefore, we do not have economic interest rate exposure with respect to the 2025 Convertible Notes. In January 2021, we issued $345.0 million aggregate principal amount of the 2028 Convertible Notes.
Removed
To achieve this objective, we invest in highly liquid and high-quality U.S. government and other highly credit rated debt securities. Our investments are exposed to market risk due to fluctuations in interest rates, which may affect our interest income and the fair market value of our investments.
Removed
To minimize our exposure due to adverse shifts in interest rates, we invest in short-term securities with short maturities. If a 1% change in interest rates were to have occurred on December 31, 2024, this change would not have had a material effect on the fair value of our investment portfolio as of that date.
Removed
Due to the short holding period of our investments, we do not believe that we have a material financial market risk exposure and do not expect our operating results or cash flows to be materially affected by a sudden change in market interest rates.
Removed
While we believe our marketable securities do not contain excessive risk, we cannot provide absolute assurance that in the future our investments will not be subject to adverse changes in market value. Foreign Currency Exchange Risk We have operations in Cambridge, United Kingdom.

Other NEO 10-K year-over-year comparisons