Quarterly report pursuant to Section 13 or 15(d)

Revenue and Accounts Receivable

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Revenue and Accounts Receivable
6 Months Ended
Jun. 30, 2016
Receivables [Abstract]  
Revenue and Accounts Receivable
Revenue and Accounts Receivable

Revenue by service type for the three and six months ended June 30, 2016 and 2015 is comprised of the following (in thousands): 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2016
 
2015
 
2016
 
2015
Biopharma Services
$
4,219

 
$
2,675

 
7,569

 
$
6,006

Clinical Services
2,542

 
1,251

 
4,998

 
2,124

Discovery Services
240

 
259

 
502

 
425

 
$
7,001

 
$
4,185

 
$
13,069

 
$
8,555



The table above includes approximately $619,000 of biopharma revenue and approximately $1,425,000 of clinical services revenue from our acquisition of Response Genetics for the three months ended June 30, 2016. The table above includes approximately $1,078,000 of biopharma revenue and approximately $3,129,000 of clinical services revenue from our acquisition of Response Genetics for the six months ended June 30, 2016.

Accounts receivable by service type at June 30, 2016 and December 31, 2015 consists of the following (in thousands): 

June 30,
2016
 
December 31,
2015
Biopharma Services
$
5,144

 
$
3,238

Clinical Services
7,119

 
3,733

Discovery Services
345

 
314

Allowance for doubtful accounts
(664
)
 
(664
)

$
11,944

 
$
6,621



At June 30, 2016, accounts receivable includes approximately $1,425,000 of unbilled revenue for clinical services provided by our location in California.

Allowance for Doubtful Accounts (in thousands)
Balance, December 31, 2015
$
664

Additions to allowance for doubtful accounts

Balance, June 30, 2016
$
664



Revenue for Biopharma Services are customized solutions for patient stratification and treatment selection through an extensive suite of DNA-based testing services. Clinical Services are tests performed to provide information on diagnosis, prognosis and theranosis of cancers to guide patient management. These tests can be billed to Medicare, another third party insurer or the referring community hospital or other healthcare facility. Discovery Services are services that provide the tools and testing methods for companies and researchers seeking to identify new DNA-based biomarkers for disease. The breakdown of our Clinical Services revenue (as a percent of total revenue) is as follows:

 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2016
 
2015
 
2016
 
2015
Medicare
12%
 
7%
 
13%
 
7%
Other insurers
17%
 
6%
 
19%
 
6%
Other healthcare facilities
7%
 
9%
 
6%
 
8%
 
36%
 
22%
 
38%
 
21%


We have historically derived a significant portion of our revenue from a limited number of test ordering sites. Test ordering sites account for all of our Clinical Services and Biopharma Services revenue. Our test ordering sites are largely hospitals, cancer centers, reference laboratories, physician offices and biopharmaceutical companies. Oncologists and pathologists at these sites order the tests on behalf of the needs of their oncology patients or as part of a clinical trial sponsored by a biopharmaceutical company in which the patient is being enrolled. We generally do not have formal, long-term written agreements with such test ordering sites, and, as a result, we may lose a significant test ordering site at any time.

The top five test ordering sites during the three months ended June 30, 2016 and 2015 accounted for 40% and 61%, respectively, of our testing volumes, with 6% and 22%, respectively, of the volume coming from community hospitals. During the three months ended June 30, 2016, there were two biopharmaceutical companies which accounted for approximately 15% and 11% of our total revenue, respectively. During the three months ended June 30, 2015, there was one biopharmaceutical company which accounted for approximately 25% of our total revenue.

The top five test ordering sites during the six months ended June 30, 2016 and 2015 accounted for 38% and 66% respectively, of our testing volumes, with 7% and 23%, respectively, of the volume coming from community hospitals. During the six months ended June 30, 2016, there were two biopharmaceutical companies which accounted for approximately 13% and 11% of our total revenue, respectively. During the six months ended June 30, 2015, there were two biopharmaceutical companies which accounted for approximately 26% and 14% of our total revenue, respectively.