GeneDx Holdings Corp.

Current report

We face uncertainty related to healthcare reform, pricing, coverage and reimbursement, which could reduce our revenue.

Current report

Healthcare reform laws, including the Patient Protection and Affordable Care Act (“ACA”) and PAMA, are significantly affecting the U.S. healthcare and medical services industry. Existing legislation, and possible future legal and regulatory changes, including potential repeal or modification of the ACA, elimination of penalties regarding the individual mandate for coverage, or approval of health plans that allow lower levels of coverage for preventive services, could materially change the structure and finances of the health insurance system and the methodology for reimbursing medical services, drugs and devices, including our current and future products and services. The ACA has also been the subject of various legal challenges, and if the plaintiffs in any case challenging the ACA are ultimately successful, insurance coverage for our tests could be materially and adversely affected. Any change in reimbursement policy could result in a change in patient cost-sharing, which could adversely affect a provider’s willingness to prescribe and patient’s willingness and ability to use our tests and any other product or service we may develop. Healthcare reforms, which may intend to reduce healthcare costs, may have the effect of discouraging third-party payors from covering certain kinds of medical products and services, particularly newly developed technologies, or other products or tests we may develop in the future. We cannot predict whether future healthcare reform initiatives will be implemented at the federal or state level or the effect any such future legislation or regulation will have on it. The taxes imposed by new legislation, cost reduction measures and the expansion in the government’s role in the U.S. healthcare industry may result in decreased profits to us, which may adversely affect our business, financial condition and results of operations.

Current report

PAMA presents significant uncertainty for future CMS reimbursement rates for our tests. Because Medicare currently covers a significant number of patients, any reduction in the CMS reimbursement rate for our tests would negatively affect our revenues and our business prospects. Under PAMA, unless delayed by an act of Congress, CMS reimbursement rates for clinical diagnostic laboratory tests are updated every three years, or annually for clinical laboratory tests that are considered “advanced diagnostic laboratory tests”. The CMS reimbursement rates for clinical diagnostic laboratory tests are updated based on the volume-weighted median of private payor rates for each clinical diagnostic laboratory test based on data submitted by certain applicable laboratories. Further, laboratories that fail to report or erroneously report required payment information may be subject to substantial civil money penalties. There can be no assurance under PAMA that adequate CMS reimbursement rates will continue to be assigned to our tests.

Current report

Absent Congressional action, the next round of PAMA-based rate updates will take effect on January 1, 2027. In September 2026, CMS published preliminary weighted medians, indicating that a substantial majority of test codes would be subject to reductions starting in January 2027, with the 15% statutory cap on annual payment rate reductions expected to apply to many of these codes. CMS is expected to publish final weighted medians and CY 2027 rates in November 2026. Depending on the scope of these reductions, it will likely impact the amount of revenue we are able to collect under these codes beginning in 2027. Because the reductions are cumulative and may continue through 2029 until CMS fully implements the weighted medians, the aggregate effect on our financial results over the phase-in period could increase over time.

Current report

Congress could modify or repeal PAMA in the future or CMS could modify regulations under PAMA, and any such action could have the effect of reducing the CMS reimbursement rate for our tests. Legislation has been introduced in Congress, including the Reforming and Enhancing Sustainable Updates to Laboratory Testing Services (RESULTS) Act, which would modify PAMA’s rate-setting methodology and delay or reduce the scheduled cuts. We cannot predict whether Congress will enact the RESULTS Act, another temporary deferral, or any other PAMA reform before January 1, 2027 or at any time thereafter, or what the terms of any such legislation would be. Further, it is possible that Medicare or other federal payors that provide reimbursement for our tests may suspend, revoke or discontinue coverage at any time, may require co-payments from patients, or may reduce the reimbursement rates payable to us. Any such action could also have a negative impact on our revenues.

Previous report

The market price of our securities may be volatile or decline due to market conditions, or failure to meet investor, stockholder or analyst expectations, which could result in a loss of your investment.

Previous report

The trading price and valuation of life sciences companies, including ours, have been and may continue to be highly volatile, which has often been unrelated or disproportionate to the operating performance of the particular companies affected. The trading prices and valuations of these stocks, and of our securities, may not be predictable.

Previous report

Future volatility in the market price for our securities may occur in response to factors beyond our control, including actual or anticipated fluctuations in our quarterly financial results, changes in market expectations regarding our operating performance, public reaction to our press releases and SEC filings, competitive developments, changes in financial estimates or recommendations by securities analysts which may result in the loss of investor confidence, and general economic and political conditions such as the war in the Middle East. These risk factors, and any other risk factors described in our filings with the SEC, could materially adversely affect our business and the market price of our securities, which may trade at prices significantly below the price paid for them and may not recover. A decline in the market price of our securities also could adversely affect our ability to issue additional securities and our ability to obtain additional financing in the future.

Previous report

In the past, securities class action litigation has often been initiated against companies following periods of volatility in their stock price. This type of litigation could result in substantial costs and divert management’s attention and resources, and could also require us to make substantial payments to satisfy judgments or settle litigation. In particular, on June 4, 2026 and July 28, 2026, putative securities class action lawsuits were filed in the United States District Court for the District of Connecticut, styled Basma v. GeneDx Holdings Corp., et al., 3:26-cv-00880 (D. Conn.) and Kanungo v. GeneDx Holdings Corp., et al., 3:26-cv-01203 (D. Conn.), respectively, against the Company and certain of the Company’s current officers. These complaints purport to bring suit on behalf of stockholders who purchased the Company’s publicly traded securities between April 16, 2025 and May 4, 2026. See also Note 9, “Purchase Commitments and Contingencies” to our consolidated financial statements for more information.