Company: BIAF
Filing Date: 2025-04-22
Form Type: 424B3
Source: 0001641172-25-005598
Chunk: 183

Company: bioAffinity Technologies, Inc.
Filing Date: 2025-04-22
Form: 424B3
Chunk 183
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      |         — |
| Shares underlying unvested             
 restricted stock outstanding           |     |                 |    349,057 |     |      | 4,649,952 |
| Anti-dilutive                          
 securities                             |     |                 | 12,951,306 |     |      | 5,333,647 |

Revenue Recognition

To determine revenue recognition for the arrangements that the Company determines are within the scope of ASC 606, Revenue from Contracts with Customers, the Company performs the following five steps: (1) identify the contract(s) with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) the entity satisfies a performance obligation.

Post-acquisition of PPLS, additional revenue streams have been consolidated starting September 19, 2023. PPLS generates three sources of revenue: (1) patient service fees, (2) histology service fees, and (3) medical director fees. The Company recognizes as revenue the amount that reflects the consideration to which it expects to be entitled in exchange for goods sold or services rendered primarily upon completion of the testing process (when results are reported) or when services have been rendered.

The Company follows a standard process, which considers historical denial and collection experience and other factors (including the period of time that the receivables have been outstanding), to estimate contractual allowances and implicit price concessions, recording adjustments in the current period as changes in estimates. The process for estimating revenues and the ultimate collection of accounts receivable involves significant judgment and estimation.

Pre-acquisition, bioAffinity’s revenue was generated in three ways: (1) royalties from the Company’s diagnostic test, CyPath ®Lung, (2) clinical flow cytometry services provided to Village Oaks related to the Company’s CyPath ®Lung test, and (3) CyPath ®Lung tests purchased by the U.S. Department of Defense (“DOD”) for an observational study, “Detection of Abnormal Respiratory Cell Populations in Lung Cancer Screening Patients Using the CyPath ®Lung Assay (NCT05870592),” and research and development on using bronchoalveolar lavage fluid as a biological sample to assess cardiopulmonary function and exercise performance in military personnel post COVID-19 infection. The royalty income from CyPath ®Lung and clinical flow cytometry services income,