Company: BLLN
Filing Date: 2025-08-11
Form Type: DRS/A
Source: 0000950123-25-007483
Chunk: 160

Company: BillionToOne, Inc.
Filing Date: 2025-08-11
Form: DRS/A
Chunk 160
---
 in an amount that reflects the consideration we
expect to be entitled to receive in exchange for those goods and services. Under ASC 606, Revenue from Contracts with Customers (ASC 606), we apply the following five-step approach: (1) identify the contract 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, a performance obligation is
satisfied.

We recognize revenue applying estimated consideration to be received for the performance obligations delivered to customers and their representatives. In
accordance with ASC 606, we apply the constraint on variable consideration and include such amounts in the transaction price only to the extent that it is probable that a significant reversal of cumulative revenue will not occur when the associated
uncertainty is resolved.

We apply the expected value method of estimating variable consideration. The total consideration we expect to collect in exchange for our
products is an estimate and is largely variable in nature. Consideration includes reimbursement from both patients and insurance carriers. We establish variable consideration by considering historical payment trends for tests delivered, test
reimbursement disallowances, and contractual arrangements in place, among other factors, which is adjusted for current expectations. Current expectations of cash collections factor in changes in reimbursement rate trends, historical events not
expected to recur, and future known changes such as anticipated contractual pricing changes or changes to insurance coverage. We also consider hindsight, where applicable, in estimates established for variable consideration and update those
estimates when actual experience supports doing so. In establishing variable consideration, we consider payors with similar reimbursement characteristics together. We monitor cash collections against the estimated variable consideration over the
expected cash collection period and any difference is recognized as an adjustment to estimated revenues after such estimated cash collection period has closed.

We
enter into contracts with third-party payors including insurance carriers and Medicaid to set the pricing for tests provided to patients. Due to the nature of these third-party payor contract arrangements, the total

113

consideration we expect to collect for test results is variable as they are dependent on the terms negotiated with the third-party payor. The predominance of our revenue is derived from payments by third-party insurance carriers. Additionally, we entered into an agreement with Johnson & Johnson in 2023 to utilize our testing capabilities as part of a project to perform a clinical trial. This arrangement involved the performance of testing and related regulatory consulting services. Revenue for