SEC Filing | Centogene N.V.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the date of December 16, 2020

Commission File Number 001-39124

Centogene N.V.

(Translation of registrant’s name into English)

Am Strande 7

18055 Rostock

Germany

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F..⌧.. Form 40-F.◻

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ◻

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ◻

Centogene N.V.

On December 16, 2020, Centogene N.V. (the “Company”) issued a press release reporting its financial results for the Nine Months Ended September 30, 2020. A copy of the press release is attached hereto as Exhibit 99.1.

Attached hereto as Exhibit 99.2, 99.3 and 99.4 are also the financial statements of the Company for the three and nine months ended September 30, 2020, the Management’s Discussion and Analysis of Financial Condition and Results of Operations for the three and nine months ended September 30, 2020 and a risk factor on COVID-19, respectively.

All exhibits attached hereto are incorporated by reference herein.

Exhibits 99.2, 99.3 and 99.4 to this Report on Form 6-K shall be deemed to be incorporated by reference into the registration statement on Form S-8 (Registration Number 333-234551) of the Company and to be a part thereof from the date on which this report is filed, to the extent not superseded by documents or reports subsequently filed or furnished.

Exhibit 99.1 to this Report on Form 6-K shall not be deemed “filed” for purposes of Section 18 of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the U.S. Securities Act of 1933, as amended, or the Exchange Act.

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	CENTOGENE N.V.


Date: December 16, 2020


	By:	/s/ Richard Stoffelen
		Name:	Richard Stoffelen
		Title:	Chief Financial Officer

Exhibit Index

Exhibit		Description of Exhibit

99.1		Press Release dated December 16, 2020
99.2		Unaudited Condensed Consolidated Interim Financial Statements as of and for the Three and Nine Months ended September 30, 2020
99.3		Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Three and Nine Months ended September 30, 2020
99.4		Risk Factor on COVID-19

Exhibit 99.1

CENTOGENE Reports Third-Quarter 2020 Financial Results and Increases Full Year Guidance

CAMBRIDGE, Mass., and ROSTOCK Germany, and BERLIN, December 16, 2020 (Globe Newswire) — Centogene N.V. (Nasdaq: CNTG) (“CENTOGENE” or the “Company”), a commercial-stage company focused on rare diseases that transforms real-world clinical and genetic data into actionable information for patients, physicians, and pharmaceutical companies, today provided an update on its corporate progress and reported its financial results for the three and nine months ended September 30, 2020.

●

Revenues increased 212% compared to Q3 2019, driven by the continued expansion of our COVID-19 testing offering

●

Increased 2020 full-year revenue guidance to more than €100 million

●

Continued growth of new pharma partnerships, with 12 new deals signed and a robust recovery anticipated in 2021

●

Expansion of commercial COVID-19 testing, which now includes antigen testing

●

Announced leadership transition and appointment of Dr. Andrin Oswald as Chief Executive Officer to support the next stage of the Company’s growth

Andrin Oswald, M.D., Chief Executive Officer at CENTOGENE, said, “I am excited to have joined CENTOGENE at such an important stage in the Company’s evolution. While I have only been with CENTOGENE for a few weeks, it is clear to me that our entire team is focused on achieving a common goal of helping rare disease patients around the world. We believe that our mission has the potential to significantly reduce the burden of rare diseases – and offers an exciting value creation opportunity for our stakeholders at the same time. Leveraging more than 20 years of professional experience across the life sciences, including my time at Novartis and the Bill and Melinda Gates Foundation, I am looking forward to helping further scale and accelerate CENTOGENE’s growth as a leader in the rare diseases space.”

Richard Stoffelen, Chief Financial Officer at CENTOGENE, said, “During the third quarter, we saw a significant increase in our revenues, year-over-year, driven by our ability to leverage our core competency in precise medical diagnoses to pivot quickly and provide solutions to help address the COVID-19 pandemic. As we approach the end of what has been an unprecedented year, I would like to thank the entire CENTOGENE team once more for their flexibility and unwavering commitment.”

A Solid Foundation for 2021

CENTOGENE has leveraged its core competency of providing precise medical diagnoses, as well as its infrastructure, to help prevent further outbreaks of SARS-CoV-2 (COVID-19) throughout 2020. As part of this initiative, CENTOGENE has become one of the largest COVID-testing companies in Europe and created a pioneering and leading role in providing testing services at airports. The positive financial contribution from COVID-19 testing will enable the Company to make strategic investments to further solidify its leading position in the rare disease space. The number of Pharma partnership discussions have also continued to increase since Q2 2020, positioning CENTOGENE for further progress in 2021.

Further information on the Company’s Q3 2020 Earnings, including the management’s discussion and analysis of financial condition and results of operations, can be found by visiting EDGAR on the SEC website at www.sec.gov, as well as the Investor Relations page of the Company’s website at http://investors.centogene.com.

About CENTOGENE

CENTOGENE engages in diagnosis and research around rare diseases transforming real-world clinical and genetic data into actionable information for patients, physicians, and pharmaceutical companies. Our goal is to bring rationality to treatment decisions and to accelerate the development of new orphan drugs by using our extensive rare disease knowledge, including epidemiological and clinical data, as well as innovative biomarkers. CENTOGENE has developed a global proprietary rare disease platform based on our real-world data repository with over 3.6 billion weighted data points from approximately 595,000 patients representing over 120 different countries as of September 30, 2020.

The Company’s platform includes epidemiologic, phenotypic, and genetic data that reflects a global population, and also a biobank of these patients’ blood samples. CENTOGENE believes this represents the only platform that comprehensively analyzes multi-level data to improve the understanding of rare hereditary diseases, which can aid in the identification of patients and improve our pharmaceutical partners’ ability to bring orphan drugs to the market. As of September 30, 2020, the Company collaborated with over 40 pharmaceutical partners covering over 45 different rare diseases.

Important Notice and Disclaimer

This press release contains statements that constitute “forward-looking statements” as that term is defined in the United States Private Securities Litigation Reform Act of 1995, including statements that express the Company’s opinions, expectations, beliefs, plans, objectives, assumptions, or projections regarding future events or future results, in contrast with statements that reflect historical facts. Examples include discussion of our strategies, financing plans, growth opportunities, and market growth. In some cases, you can identify such forward-looking statements by terminology such as “anticipate,” “intend,” “believe,” “estimate,” “plan,” “seek,” “project” or “expect,” “may,” “will,” “would,” “could,” or “should,” the negative of these terms or similar expressions. Forward-looking statements are based on management’s current beliefs and assumptions and on information currently available to the Company. However, these forward-looking statements are not a guarantee of our performance, and you should not place undue reliance on such statements. Forward-looking statements are subject to many risks, uncertainties, and other variable circumstances, such as negative worldwide economic conditions and ongoing instability and volatility in the worldwide financial markets, the effects of the COVID-19 pandemic on our business and results of operations, possible changes in current and proposed legislation, regulations and govern-mental policies, pressures from increasing competition and consolidation in our industry, the expense and uncertainty of regulatory approval, including from the U.S. Food and Drug Administration, our reliance on third parties and collaboration partners, including our ability to manage growth and enter into new client relationships, our dependency on the rare disease industry, our ability to manage international expansion, our reliance on key personnel, our reliance on intellectual property protection, fluctuations of our operating results due to the effect of exchange rates, or other factors. Such risks and uncertainties may cause the statements to be inaccurate and readers are cautioned not to place undue reliance on such statements. Many of these risks are outside of the Company’s control and could cause its actual results to differ materially from those it thought would occur. The forward-looking statements included in this press release are made only as of the date hereof. The Company does not undertake, and specifically declines, any obligation to update any such statements or to publicly announce the results of any revisions to any such statements to reflect future events or developments, except as required by law.

For further information, please refer to the Risk Factors section in our Annual Report for the year ended December 31, 2019, on Form 20-F filed with the SEC on April 23, 2020, Form 6-K containing our financial results for the three months ended March 31, 2020, furnished to the SEC on June 15, 2020, Form 6-K containing our financial results for the three and nine months ended September 30, 2020, furnished to the SEC on December 16, 2020, and other current reports and documents furnished to or filed with the U.S. Securities and Exchange Commission (SEC). You may get these documents by visiting EDGAR on the SEC website at www.sec.gov.

Media Contact:

CENTOGENE

Sun Kim

Chief Strategy and Investor Relations Officer

investor.relations@centogene.com

FTI Consulting
Bridie Lawlor O’Boyle
+1.917.929.5684
bridie.lawlor@fticonsulting.com

Centogene N.V.

Unaudited interim condensed consolidated statements of comprehensive loss for the three and nine months ended September 30, 2019 and 2020

(in EUR k)


		For the three months ended September 30		For the nine months ended September 30
	Note	2019	2020	2019	2020
Revenue	4, 5	11,638	36,305	33,559	58,129
Cost of sales		6,641	26,059	19,499	39,892
Gross profit		4,997	10,246	14,060	18,237
Research and development expenses		2,011	4,796	6,119	10,606
General administrative expenses		4,884	8,373	16,487	24,038
Selling expenses		1,788	1,300	6,144	6,012
Impairment of financial assets	8	92	1,147	554	2,821
Other operating income	6.1	935	679	2,623	2,425
Other operating expenses	6.2	—	53	2	191
Real estate transfer tax expenses	7	—	—	1,200	—
Operating loss		(2,843)	(4,744)	(13,823)	(23,006)
Interest and similar income		—	—	12	6
Interest and similar expense		1,433	793	1,865	1,504
Financial costs, net		(1,433)	(793)	(1,853)	(1,498)
Loss before taxes		(4,276)	(5,537)	(15,676)	(24,504)
Income tax expenses		—	103	163	232
Loss for the period		(4,276)	(5,640)	(15,839)	(24,736)
Other comprehensive income/(loss), all attributable to equity holders of the parent		(1)	(66)	9	4
Total comprehensive loss		(4,277)	(5,706)	(15,830)	(24,732)
Attributable to:
Equity holders of the parent		(4,247)	(5,708)	(15,674)	(24,671)
Non‑controlling interests		(30)	2	(156)	(61)
		(4,277)	(5,706)	(15,830)	(24,732)
Loss per share - Basic and diluted (in EUR)		(0.27)	(0.27)	(0.99)	(1.20)

The accompanying notes form an integral part of these unaudited interim condensed consolidated financial statements

Centogene N.V.

Unaudited interim condensed consolidated statements of financial position as at December 31, 2019 and September 30, 2020

(in EUR k)


Assets	Note	Dec 31, 2019	Sep, 2020
Non‑current assets
Intangible assets		14,145	16,405
Property, plant and equipment		8,376	13,585
Right-of-use assets		24,932	23,915
Other assets	8	1,948	1,953
		49,401	55,858
Current assets
Inventories		1,809	7,291
Trade receivables and contract assets	8	16,593	25,787
Other assets	8	8,612	4,055
Cash and cash equivalents	9	41,095	28,748
		68,109	65,881
		117,510	121,739


Equity and liabilities	Note	Dec 31, 2019	Sep, 2020
Equity
Issued capital	10	2,383	2,653
Capital reserve	10	98,099	122,801
Retained earnings and other reserves		(40,622)	(66,073)
Non‑controlling interests		(938)	(26)
		58,922	59,355
Non‑current liabilities
Non‑current loans	11.1	1,578	501
Lease liabilities	11.1	18,069	18,052
Deferred tax liabilities		—	219
Government grants	11.2	9,941	9,296
		29,588	28,068
Current liabilities
Government grants	11.2	1,348	1,350
Current loans	11.1	3,688	4,619
Lease liabilities	11.1	3,635	3,295
Trade payables	11.2	8,554	12,052
Other liabilities	11.2	11,775	13,000
		29,000	34,316
		117,510	121,739

The accompanying notes form an integral part of these unaudited interim condensed consolidated financial statements

Centogene N.V.

Unaudited interim condensed consolidated statements of cash flows for the nine months ended September 30, 2019 and 2020

(in EUR k)


	Note	2019	2020
Operating activities

Loss before taxes		(15,676)	(24,504)

Adjustments to reconcile loss to cash flow from operating activities

Amortization and depreciation	5	4,461	6,943
Interest income		(12)	(6)
Interest expense		1,865	1,504
Gain on the disposal of property, plant and equipment		(532)	—
Expected credit loss allowances on trade receivables and contract assets	8	554	2,821
Share‑based payment expenses	12	5,299	2,542
Real Estate transfer tax expenses	7	1,200	—
Other non‑cash items		(26)	(1,800)

Changes in operating assets and liabilities
Inventories		(240)	(5,482)
Trade receivables and contract assets	8	(3,336)	(12,015)
Other assets	8	(739)	5,605
Trade payables	11.2	3,280	3,498
Other liabilities	11.2	448	1,225

Cash flow used in operating activities		(3,454)	(19,669)

Investing activities

Cash paid for investments in intangible assets	5	(5,366)	(4,781)
Cash paid for investments in property, plant and equipment		(1,266)	(6,641)
Grants received for investment in property, plant and equipment	11.2	341	390
Cash received from the disposals of property, plant and equipment		19,800	—
Interest received		12	6

Cash flow used in investing activities		13,521	(11,026)

Financing activities
Cash received from issuance of shares	10	—	22,430
Cash paid for acquisition of non-wholly owned subsidiary		—	(75)
Cash received from loans	11.1	1,545	1,114
Cash repayments of loans	11.1	(11,871)	(1,260)
Cash received from finance leases		470	—
Cash repayments of lease liabilities	11.1	(1,507)	(2,833)
Interest paid		(1,865)	(1,028)

Cash flow used in financing activities		(13,228)	18,348


Changes in cash and cash equivalents		(3,161)	(12,347)
Cash and cash equivalents at the beginning of the period		9,222	41,095
Cash and cash equivalents at the end of the period		6,061	28,748

The accompanying notes form an integral part of these unaudited interim condensed consolidated financial statements

Centogene N.V.

Unaudited interim condensed consolidated statements of changes in equity for the nine months ended September 30, 2019 and 2020

Attributable to the owners of the parent

Currency

Non-

Issued

Capital

translation

Retained

controlling

Total

in EUR k

Note

capital

reserve

earnings

Total

interests

equity

As of January 1, 2019

1,903

45,342

(16)

(19,948)

27,281

(757)

26,524

Loss for the period

—

(15,683)

(156)

(15,839)

Other comprehensive loss

—

Total comprehensive loss

—

(15,683)

(15,674)

(156)

(15,830)

Share-based payments

—

494

—

494

—

494

As of September 30, 2019

1,903

45,836

(7)

(35,631)

12,101

(913)

11,188


		Attributable to the owners of the parent
				Currency			Non-
		Issued	Capital	translation	Retained		controlling	Total
in EUR k	Note	capital	reserve	reserve	earnings	Total	interests	equity

As of January 1, 2020		2,383	98,099	—	(40,622)	59,860	(938)	58,922
Loss for the period		—	—	—	(24,675)	(24,675)	(61)	(24,736)
Other comprehensive loss		—	—	4	—	4	—	4
Total comprehensive loss		—	—	4	(24,675)	(24,671)	(61)	(24,732)
Share-based payments	12	—	2,542	—	—	2,542	—	2,542
Issuance of shares	10	240	22,969	—	—	23,209	—	23,209
Exercise of options		30	(30)	—	—	—	—	—
Transaction costs		—	(779)	—	—	(779)	—	(779)
Disposal of non-wholly owned subsidiary	6.2	—	—	—	—	—	268	268
Acquisition of non-wholly owned subsidiary		—	—	—	(780)	(780)	705	(75)
As of September 30, 2020		2,623	122,831	4	(66,077)	59,381	(26)	59,355

The accompanying notes form an integral part of these unaudited interim condensed consolidated financial statements

Notes to the unaudited interim condensed consolidated financial statements as of December 31, 2019 and September 30, 2020 and for the three months and nine months ended September 30, 2019 and 2020

1 General company information

Centogene N.V. (“the Company”) and its subsidiaries (“the Group”) focus on rare diseases and seek to transform real-world clinical and genetic data into actionable information for patients, physicians and pharmaceutical companies. The mission of the Company is to bring rationality to treatment decisions and to accelerate the development of new orphan drugs by using our knowledge of the global rare disease market, including epidemiological and clinical data and innovative biomarkers.

On November 7, 2019, the Company completed an initial public offering (“IPO”) and has since been listed on Nasdaq Global Market under stock code “CNTG”. We have historically conducted our business through Centogene AG (which is now known as Centogene GmbH), and therefore our historical financial statements present the results of operations and financial condition of Centogene AG and its controlled subsidiaries. In connection with our initial public offering, Centogene N.V. became the holding company of Centogene AG on November 12, 2019, and the historical consolidated financial statements of Centogene AG became the historical consolidated financial statements of Centogene N.V. Centogene N.V. is a public company with limited liability incorporated in the Netherlands, with registered office located at Am Strande 7 in 18055 Rostock, Germany and Dutch trade register number 72822872.

On March 5, 2020, the Company resolved that Centogene AG shall be converted into a German limited liability company and renamed Centogene GmbH. Such conversion became effective upon the registration in the German commercial register on June 29, 2020. Unless otherwise stated, “Centogene GmbH” also refers to the historical operations of Centogene AG throughout the notes.

In July 2020, the Company completed a follow-on public offering of 3,500,000 common shares of the Company (the “July 2020 Offering”), consisting of 2,000,000 common shares offered by the Company and 1,500,000 common shares offered by selling shareholders at a price to the public of USD 14.00 per common share (i.e. EUR 12.71 per share). Aggregate offering proceeds, net of underwriting discounts, commissions and transaction costs, were EUR 22 million to the Company.

2 Basis of preparation

The interim condensed consolidated financial statements for the three and nine months ended September 30, 2019 and 2020 have been prepared in accordance with IAS 34 Interim Financial Reporting.

The interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group’s annual consolidated financial statements as of December 31, 2018 and 2019 and for the three years ended December 31, 2019. Unless otherwise specified, "the Company" refers to Centogene N.V. and Centogene GmbH throughout the remainder of these notes, while "the Group" refers to Centogene N.V., Centogene GmbH and its subsidiaries.

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group’s annual consolidated financial statements for the year ended December 31, 2019, except for the adoption of new standards effective as of January 1, 2020 (see note 2.2). The Group has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective.

Several other amendments and interpretations apply for the first time in 2020, but do not have an impact on the interim condensed consolidated financial statements of the Group.

These interim condensed consolidated financial statements are presented in euro, which is the Group's functional currency. Unless otherwise specified, all financial information presented in euro is rounded to the nearest thousand (EUR k) in line with customary commercial practice.

2.1 COVID-19 reporting

Due to the growth and significance of the COVID-19 business in relation to the total activities of the Group, the COVID-19 testing business is managed and reported as a separate segment beginning in the third quarter of 2020. In the second quarter 2020 report, furnished to the SEC on Form 6-K on September 23, 2020, the financial impact of the COVID-19 business has been reported as a part of our Diagnostics segment, whereas it has been separated from the Diagnostics segment and included in the year-to-date COVID-19 financials in this report.

In the third quarter of 2020, the Company entered into a collaboration agreement with Dr. Bauer Laboratoriums GmbH, Rostock (hereafter ‘Bauer GmbH’). Bauer GmbH supports Centogene in certain areas of its COVID-19 testing business by providing the medical laboratory services to facilitate Centogene to perform its COVID-19 testing business activities. Bauer GmbH is wholly owned by a long-time employee of Centogene, who from a medical perspective and by observing the Medical Association's professional code of conduct continues to operate as an independent medical physician.

As per the criteria in IFRS 10, Centogene assessed the control it has over Bauer GmbH and concluded to consolidate the activities of Bauer GmbH in the Group from the third quarter of 2020. Centogene does not own any shares in Bauer GmbH. However, based on the analysis of all facts and circumstances surrounding the close collaboration with Bauer GmbH and the employment relationship with the sole shareholder of Bauer GmbH, this shareholder is considered as a de facto agent. Centogene meets the criteria of the control model under IFRS 10 as it has exposure to variable returns and the ability to use power to affect returns. Bauer GmbH has a share in the net result of the respective COVID-19 testing business which has been accounted for under non-controlling interest.

2.2Effects of new accounting standards

The following amendments and interpretations apply for the first time in 2020 and had no impact on the unaudited interim condensed consolidated financial statements of the Group:

●

Amendments to IAS 1 and IAS 8: Definition of Material

●

Amendments to IFRS 3: Definition of a Business

●

Amendments to IFRS 7, IFRS 9 and IAS 39: Interest Rate Benchmark Reform

●

References to the Conceptual Framework for Financial Reporting issued on 29 March 2018

3 Effect of COVID-19 Pandemic

The COVID-19 pandemic, which began in December 2019, has spread worldwide and continues to cause many governments to maintain measures to slow the spread of the outbreak through quarantines, travel restrictions, closures of borders and requiring maintenance of physical distance between individuals. Due to the complexity of the overall factors, which cannot be reliably separated from unrelated drivers of changes in the Group’s financial performance, the impact of the pandemic could not be quantified.

For more information, also refer to note 2.1 COVID-19 reporting and to notes 4 and 5 below on the new COVID-19 segment.

4 Revenues from contracts with customers

Three months ended September 30


in EUR k	Three Months Ended September 30, 2019
	Pharmaceutical	Diagnostics	Total
Rendering of services	4,512	6,805	11,317
Sales of goods	321	—	321
Total Revenues from contracts with external customers	4,833	6,805	11,638

Recognized over time	4,512	6,805	11,317
Recognized at a point in time	321	—	321
Total Revenues from contracts with external customers	4,833	6,805	11,638

Geographical information
Europe	18	1,945	1,963
—Germany*	18	78	96
Middle East	—	3,407	3,407
—Saudi Arabia#	—	1,921	1,921
North America	4,815	325	5,140
—United States#	4,815	307	5,122
Latin America	—	829	829
Asia Pacific	—	299	299
Total Revenues from contracts with external customers	4,833	6,805	11,638

* country of the incorporation of Centogene GmbH

# countries contributing more than 10% of the Group’s total consolidated revenues for the three months ended September 30, 2019


in EUR k	Three Months Ended September 30, 2020
	Pharmaceutical	Diagnostics	Covid-19	Total
Rendering of services	3,598	5,069	26,795	35,462
Sales of goods	202	—	641	843
Total Revenues from contracts with external customers	3,800	5,069	27,436	36,305

Recognized over time	3,598	5,069	8,693	17,360
Recognized at a point in time	202	—	18,743	18,945
Total Revenues from contracts with external customers	3,800	5,069	27,436	36,305

Geographical information
Europe	39	1,547	27,238	28,824
—Germany#*	20	52	26,568	26,640
—Netherlands**	—	—	2	2
Middle East	26	2,648	—	2,674
North America	3,735	333	197	4,265
—United States#	3,735	299	197	4,231
Latin America	—	398	1	399
Asia Pacific	—	143	—	143
Total Revenues from contracts with external customers	3,800	5,069	27,436	36,305

* country of the incorporation of Centogene GmbH

** country of the incorporation of Centogene N.V.

# countries contributing more than 10% of the Group’s total consolidated revenues for the three months ended September 30, 2020

Nine months ended September 30


in EUR k	Nine months ended September 30, 2019
	Pharmaceutical	Diagnostics	Total
Rendering of services	12,545	20,028	32,573
Sales of goods	986	—	986
Total Revenues from contracts with external customers	13,531	20,028	33,559

Recognized over time	11,964	20,028	31,992
Recognized at a point in time	1,567	—	1,567
Total Revenues from contracts with external customers	13,531	20,028	33,559

Geographical information
Europe	298	5,357	5,655
—Germany*	213	211	424
Middle East	61	10,117	10,178
—Saudi Arabia#	—	5,102	5,102
North America	13,172	1,646	14,818
—United States#	13,172	1,280	14,452
Latin America	—	2,148	2,148
Asia Pacific	—	760	760
Total Revenues from contracts with external customers	13,531	20,028	33,559

*country of the incorporation of Centogene GmbH

# countries contributing more than 10% of the Group's total consolidated revenues for the nine months ended September 30, 2019


in EUR k	Nine months ended September 30, 2020
	Pharmaceutical	Diagnostics	Covid-19	Total
Rendering of services	11,478	16,308	28,848	56,634
Sales of goods	812	—	683	1,495
Total Revenues from contracts with external customers	12,290	16,308	29,531	58,129

Recognized over time	11,478	16,308	9,215	37,001
Recognized at a point in time	812	—	20,316	21,128
Total Revenues from contracts with external customers	12,290	16,308	29,531	58,129

Geographical information
Europe	106	4,282	29,323	33,711
—Germany#*	58	144	28,645	28,847
—Netherlands**	—	3	2	5
Middle East	74	8,852	—	8,926
North America	12,110	1,446	206	13,762
—United States#	12,110	1,254	206	13,570
Latin America	—	1,362	2	1,364
Asia Pacific	—	366	—	366
Total Revenues from contracts with external customers	12,290	16,308	29,531	58,129

* country of the incorporation of Centogene GmbH

** country of the incorporation of Centogene N.V.

# countries contributing more than 10% of the Group's total consolidated revenues for the nine months ended September 30, 2020

The Group collaborated with the majority of our pharmaceutical partners on a worldwide basis in 2019 and 2020. In addition, in cases where our pharmaceutical partners are developing a new rare disease treatment, it is generally anticipated that the final approved treatment will be made available globally. As a result, we allocate the revenues of our pharmaceutical segment by geographical region by reference to the location where each pharmaceutical partner mainly operates, which is based on the region from which most of their revenues are generated. The allocation of revenues in our diagnostics segment and COVID-19 segments are based on the location of each customer.

Pharmaceutical segment

During the three and nine months ended September 30, 2020, revenues from one pharmaceutical partner represented 7.3% and 14.4% respectively, of the Group's total revenues (the three and nine months ended September 30, 2019: 25.4% and 26.5%, respectively).

During the nine months ended September 30, 2019, we have entered into two collaborations with an existing pharmaceutical partner, of which upfront fees of EUR 430k, representing the transaction price allocated to the one-off transfer of the Group's intellectual property, were received and recognized as revenues. No such revenues were recognized in the three and nine months ended September 30, 2020 and the three months ended September 30, 2019.

Covid-19 segment

The Company has commenced testing for COVID-19 in March 2020. Starting from the Mecklenburg-Western Pomerania region of Germany focusing on employees and essential workers in Rostock, the testing for COVID-19 was further expanded to nursing homes as well as to high school students in Germany, and made available to the rest of the world in May 2020. Some of the tests are offered free of charge by the Company, while others are offered in collaboration with the state government, educational institutions and other companies, as well as via the online marketplace. In particular we expanded our COVID-19 testing and entered into new collaborations during the third quarter by launching a CE-labelled CentoSwab (a two-component dry plastic swab for oropharyngeal swab sampling), and opened test centers at Hamburg Airport, Düsseldorf Airport, the Free State of Bavaria and Munich and Nuremberg Central Stations.

COVID-19 revenues are based on a negotiated price per test or on the basis of agreements covering tests to be performed over defined periods. Given the short turnaround time for the COVID-19 tests, revenues from COVID-19 tests that are on a price per test basis are considered as recognized at a point in time. Revenues from COVID-19 tests that are on the basis of agreements covering tests to be performed over defined periods are considered as recognized over time.

During the three and nine months ended September 30, 2020, revenues from two COVID-19 partners represented 25.4% and 23.9% for the quarter and 15.9% and 15.0% for the nine months ended, respectively, of the Group’s total revenues.

To support the expansion of test offerings, the Company acquired laboratory facilities and equipment, developed a Corona Test Portal and leased laboratory space at several locations in Germany. Additionally, COVID-19 testing capacity is provided through our custom-built CentoTruck, a mobile laboratory in a container setup to carry out the COVID-19 analysis. Total investments in COVID-19 testing as of September 30, 2020 amounted to approximately € 6.3 million, of which approximately € 4.8 million and €0.6 million, respectively, are included in property, plant and equipment and right-of-use assets. An amount of € 0.9 million is included in intangible assets and relates to the development of the Corona Test Portal.

5 Segment information

Three months ended September 30


in EUR k	Three months ended September 30, 2019
	Pharmaceutical	Diagnostics	Corporate	Total
Total Revenues from contracts with external customers	4,833	6,805	—	11,638

Adjusted EBITDA	3,400	757	(4,917)	(760)

Capital Expenditures
Additions to property, plant and equipment and right-of-use assets	—	150	276	426
Additions to intangible assets	1,672	—	578	2,250

Other segment information
Depreciation and amortization	281	542	789	1,612
Research and development expenses	—	—	2,011	2,011


in EUR k	Three months ended September 30, 2020
	Pharmaceutical	Diagnostics	Covid-19	Corporate	Total
Total Revenues from contracts with external customers	3,800	5,070	27,435	—	36,305

Adjusted EBITDA	871	(1,210)	9,516	(10,261)	(1,084)

Capital Expenditures
Additions to property, plant and equipment and right-of-use assets	3	195	2,900	516	3,614
Additions to intangible assets	218	—	361	237	816

Other segment information
Depreciation and amortization	617	650	110	1,134	2,511
Research and development expenses	—	—	—	4,796	4,796

Nine months ended September 30


	Nine Months Ended September 30, 2019
in EUR k	Pharmaceutical	Diagnostics	Corporate	Total
Total Revenues from contracts with external customers	13,531	20,028	—	33,559

Adjusted EBITDA	9,561	1,298	(14,922)	(4,063)

Capital Expenditures
Additions to property, plant and equipment and right-of-use assets	179	419	668	1,266
Additions to intangible assets	3,458	—	1,908	5,366

Other segment information
Depreciation and amortization	794	1,627	2,040	4,461
Research and development expenses	—	—	6,119	6,119


	Nine Months Ended September 30, 2020
in EUR k	Pharmaceutical	Diagnostics	Covid-19	Corporate	Total
Total Revenues from contracts with external customers	12,290	16,309	29,530	—	58,129

Adjusted EBITDA	5,278	(2,736)	10,306	(26,369)	(13,521)

Capital Expenditures
Additions to property, plant and equipment and right-of-use assets	304	585	5,400	2,352	8,641
Additions to intangible assets	3,072	—	888	821	4,781

Other segment information
Depreciation and amortization	1,688	1,757	164	3,334	6,943
Research and development expenses	—	—	—	10,606	10,606

Adjustments

Corporate expenses, depreciation and amortization, interest and similar income and expenses, as well as share-based payment expenses are not allocated to individual segments as the underlying instruments are managed on a group basis. Current taxes and deferred taxes are allocated to Corporate as they are also managed on a group basis.

Increases in corporate expenses for the three and nine months ended September 30, 2020 are mainly due to our continued international growth and business expansion. The increase is also due to the costs of operating as a public company, such as additional legal, accounting, corporate governance and investor relations expenses, and higher directors' and officers' insurance premiums.

Corporate expenses for the three and nine months ended September 30, 2020 included expenses related to the July 2020 Offering as described in note 1 of EUR 105k and EUR 278k, respectively. Corporate expenses for the nine months ended September 30, 2019 also included real estate transfer tax of EUR 1,200k related to an intercompany sale of land and building. No such expenses were incurred in the nine months ended September 30, 2020 (see note 7).

Capital expenditure consists of additions of property, plant and equipment, right-of-use assets and intangible assets. All of such assets are located in Germany, which is the country of the registered office of the Company, except for property, plant and equipment of EUR 552k (December 31, 2019: EUR 286k) and right-of-use assets of EUR 792k (December 31, 2019: EUR 1,042k), which is located in the United States.

Reconciliation of segment Adjusted EBITDA to Group loss for the period


For the three months ended September 30	2019	2020
Reported segment Adjusted EBITDA	4,157	9,177
Corporate expenses	(4,917)	(10,261)
	(760)	(1,084)
Share-based payment expenses (Note 12)	(471)	(1,149)
Depreciation and amortization	(1,612)	(2,511)
Operating loss	(2,843)	(4,744)
Financial costs, net	(1,433)	(793)
Income taxes expenses	—	(103)
Loss for the three months ended September 30	(4,276)	(5,640)


For the nine months ended September 30	2019	2020
Reported segment Adjusted EBITDA	10,859	12,848
Corporate expenses	(14,922)	(26,369)
	(4,063)	(13,521)
Share-based payment expenses (Note 12)	(5,299)	(2,542)
Depreciation and amortization	(4,461)	(6,943)
Operating loss	(13,823)	(23,006)
Financial costs, net	(1,853)	(1,498)
Income taxes expenses	(163)	(232)
Loss for the nine months ended September 30	(15,839)	(24,736)

6 Other income and expenses

6.1Other operating income


	For the Three months ended September 30		For the Nine months ended September 30
in EUR k	2019	2020	2019	2020
Government grants	363	535	1,833	1,940
Income from the reversal of provisions	—	—	89	—
Gain on disposal of property, plant and equipment	532	—	532	—
Others	40	144	169	485
Total other operating income	935	679	2,623	2,425

Government grants contain performance-based grants to subsidize research, development and innovation in the state of Mecklenburg-Western Pomerania from funds granted by the European Regional Development Fund. Furthermore, government grants contain the release of deferred income from investment related grants.

6.2Other operating expenses


	For the Three months ended September 30		For the Nine months ended September 30
in EUR k	2019	2020	2019	2020
Currency losses	—	23	2	60
Others	—	30	—	131
Total other operating expenses	—	53	2	191

During the nine months ended September 30, 2020, the Group disposed of its entire 51% interest in LPC GmbH (“LPC”) to the minority shareholders for a consideration of EUR 213k, of which EUR 200k is to be paid over a period of four years (and included in other assets, see note 8). The related non-controlling interest of EUR 268k (accumulated share of loss) was debited to profit or loss, and the sale resulted in a loss of EUR 101k.

7 Sale and Leaseback transaction

In June 2019, in preparation for a sale and leaseback transaction, the Company sold its land and building (the Rostock headquarters building) with a carrying value of EUR 22,778k to another subsidiary of the Group. Such intercompany transaction resulted in a real estate transfer tax expense of EUR 1,200k and was recognized in the three and nine months period ended September 30, 2019.

8 Trade receivables and other assets


in EUR k	Dec 31, 2019	Sep 30, 2020
Non‑current
Other assets - Rental deposits	1,948	1,853
Other assets – Others	—	100
	1,948	1,953
Current
Trade receivables, net	12,709	22,674
Contract assets, net	3,884	3,113
Receivables due from shareholders	2,766	—
Other assets	5,846	4,055
	25,205	29,842
Total non-current and current trade receivables and other assets	27,153	31,795

Trade receivables and contract assets

Trade receivables are non-interest bearing and are generally due in 30 to 90 days. In general, portfolio-based expected credit loss allowances are recognized on trade receivables and contract assets.

Considering the potential impact of the COVID-19 pandemic on the global economy, the Group has re-assessed the credit loss rates in relation to the outstanding trade receivables and contract assets as follows:


in EUR k	Dec, 2019		Sep 30, 2020
Not past due	11,102		21,273
Past due 1-30 days	1,113		1,033
Past due 31-90 days	1,708		1,247
Past due more than 90 days	5,005		7,380
Total gross amount of trade receivables and contract assets	18,928		30,933

Expected credit loss rate
Not past due	0.3	%	0.7	%
Past due 1-30 days	1.0	%	5.9	%
Past due 31-90 days	1.2	%	10.1	%
Past due more than 90 days	45.4	%	65.3	%
Expected credit loss rate on total gross trade receivables and contract assets	12.3	%	16.6	%

Expected credit loss	2,335		5,146

Based on the re-assessment the Group recognized impairment losses on receivables and contract assets arising from contracts with customers, included under impairment of financial assets in the consolidated statement of comprehensive loss, amounting to EUR 1,147k and EUR 2,821k, respectively, for the three and nine months ended September 30, 2020 (the three and nine months ended September 30, 2019: EUR 92k and EUR 554k, respectively).

Receivables due from shareholders

In 2016, the Group established a virtual share option program ("2016 VSOP") under Centogene GmbH that entitled the management board to grant virtual share options to individuals, in regard to services they provide and their

continuous commitment to the Group. Upon completion of the IPO in November 2019, all options granted under the 2016 VSOP were vested immediately in full, and the holders of vested options were entitled to receive a direct cash payment from the Company according to the calculation as stipulated in the 2016 VSOP, which is determined based on the IPO price of the shares of Centogene N.V. and the exercise prices of the vested options.

The payables by the Group to the holders of vested options were recorded as a liability with a carrying amount of EUR 2,766k by the end of December 31, 2019 (see note 11.2). As the payments to the option holders would be reimbursed by certain original shareholders to the Company, corresponding receivables against shareholders were recorded. Such receivables were considered as additional capital from shareholders and recorded against equity (capital reserve). Upon the completion of the July 2020 Offering, the relevant payables to the holders of vested options were settled by the proceeds received from such original shareholders from the sale of their shares.

Other assets

The non-current portion of other assets mainly include cash deposit of EUR 1,500k (used to secure a bank guarantee of EUR 3,000k) relating to the leases of Rostock headquarters building, cash deposits of EUR 128k (used to secure a bank guarantee of EUR 257k) relating to the leases of Berlin office and EUR 191k for the leases of certain plant and machineries. It also includes the consideration receivable for the sale of LPC of EUR 200k, among which EUR 100k is due after 1 year (see note 6.2).

The current portion of other assets include prepaid expenses of EUR 1,483k (December 31, 2019: EUR 3,481k) as well as receivables from grants of EUR 1,268k (December 31, 2019: EUR 409k).

9 Cash and short-term deposits

As of September 30, 2020, the Group has pledged its short-term deposits with carrying amount of EUR 1,500k (December 31, 2019: EUR 1,500k) and EUR 2,500k (December 31, 2019: EUR 2,500k) respectively, to fulfil collateral requirements in respect of existing secured bank loan and overdraft facility up to EUR 2,500k. In addition, the Group has pledged its short-term deposits of EUR 1,000k (December 31, 2019: EUR nil) related to another overdraft facility up to EUR 500k.

The restriction applying to the collateral may be terminated at any time subject to the full amount of the relevant bank loans and the overdrafts being repaid.

10 Equity

As discussed in note 1, Centogene N.V. became the parent holding company of the Group on November 12, 2019 as part of the IPO process. All share, per-share and related information presented in the financial statements and corresponding disclosure notes have been retrospectively adjusted, where applicable, to reflect the impact of the share split resulting from the reorganization.

In July 2020, the Company completed a follow-on public offering of 3,500,000 common shares of the Company, consisting of 2,000,000 common shares offered by the Company and 1,500,000 common shares offered by selling shareholders at a price to the public of USD 14.00 per common share (i.e. EUR 12.71 per share). Aggregate offering proceeds, net of underwriting discounts, commissions and transaction costs, were EUR 22 million to the Company.

Capital reserve

As of September 30, 2020, capital reserve included a share premium of EUR 107,499k, being amounts paid in by shareholders at the issuance of shares in excess of the par value of the shares issued, net of any transaction costs incurred for the share issuance.

In addition, it also included amounts recorded in respect of share-based payments. For additional information on the share-based payments, see note 12.

11 Financial liabilities

11.1Interest-bearing liabilities


in EUR k	Dec 31, 2019	Sep 30, 2020
Non‑current liabilities
Non‑current portion of secured bank loans	968	501
Municipal loans	610	—
Total non‑current loans	1,578	501
Lease liabilities	18,069	18,052
Total non‑current liabilities	19,647	18,553

Current liabilities
Current portion of secured bank loans	802	868
Other bank loans	—	406
Bank overdrafts	2,636	3,345
Municipal loans	250	—
Total current loans	3,688	4,619
Current portion of lease liabilities	3,635	3,295
Total current liabilities	7,323	7,914

Total non‑current and current liabilities	26,970	26,467

As of September 30, 2020, short-term cash deposits of EUR 1,500k (December 31, 2019: EUR 1,500k) were used to secure the secured bank loan outstanding (see note 9).

Other bank loans outstanding as of September 30, 2020 represented bank loans granted under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). Subject to certain reporting and review requirements, the Company may apply for forgiveness of the amount after the 24-week period beginning on the date of first disbursement of the loans. The Company is in the process of preparing the relevant application and anticipates the result of the forgiveness will be available in the first half of 2021. The amount which is forgiven will be considered as government grant income, while any remaining amount not forgiven will be repaid by the Company. Accordingly, the entire amount was classified as current.

The following table is based on the original terms and conditions:

Conditions and statement of liabilities

The outstanding interest-bearing liabilities as of September 30, 2020 and December 31, 2019 have the following conditions:


				Dec 31, 2019		Sep 30, 2020
				Nominal	Carrying	Nominal	Carrying
in EUR k	Currency	Nominal interest rate	Maturity	amount	amount	amount	amount
Secured bank loan	EUR	3.95%	2018‑25	1,770	1,770	1,369	1,369
Other bank loan	USD	1%	2020-22	—	—	406	406
Municipal loan	EUR	8.25%; plus 1.5% profit-related; 0.75% on losses	2018-23	500	500	—	—
Municipal loan	EUR	8%; plus 1.5% profit-related; 0.75% on losses	2021	360	360	—	—
Bank overdrafts	EUR	4.46%	Rollover	476	476	490	490
Bank overdrafts	EUR	3.75%	Rollover	2,160	2,160	2,405	2,405
Bank overdrafts	EUR	3.59%	Rollover	—	—	450	450
Lease liabilities	EUR	2.1%-3.5%*, 5.4%-8.9%	2017-31	21,704	21,704	21,347	21,347
Total interest‑bearing financial liabilities				26,970	26,970	26,467	26,467

* represents the incremental borrowing rate of the Group at the commencement of the leases

The bank overdrafts of EUR 2,405k as of September 30, 2020 (December 31, 2019: EUR 2,160k) were secured by short-term deposits with a carrying amount of EUR 2,500k (December 31, 2019: EUR 2,500k) (see note 9). The bank overdrafts of EUR 490k (December 31, 2019: EUR 476k) were secured by guarantees provided by certain of the Company's shareholders as of December 31, 2019, and these guarantees were released providing security over a short-term deposit with a carrying amount of EUR 500k subsequent to the year end (see note 9).

The municipal loan due to MBMV (Mittelständische Bürgschaftsbank Mecklenburg-Vorpommern) of EUR 860k outstanding as of December 31, 2019 was secured by guarantees provided by the Group's shareholders, and were released upon full repayment in February 2020.

11.2Trade payables and other liabilities


in EUR k	Dec 31, 2019	Sep 30, 2020
Trade payables	8,554	12,052
Government grants (deferred income)	11,289	10,646
Liability for Virtual Stock Option Program	2,769	—
Contract liabilities	3,748	3,134
Others	5,258	9,866
Trade payables and other liabilities	31,618	35,698
Non‑current	9,941	9,296
Current	21,677	26,402

Government grants mainly include investment-related government grants. These were received for the purchase of certain items of property, plant and equipment for the research and development facilities in Mecklenburg-Western Pomerania, including the Rostock facility. The grants were issued in the form of investment subsidies as part of the joint federal and state program, "Verbesserung der regionalen Wirtschaftsstruktur" (improvement of the regional economic structure) in connection with funds from the European Regional Development Fund. Additional grants received during the nine months ended September 30, 2020 are related to the purchase of certain items of property, plant and equipment amounted to EUR 390k (the nine months ended September 30, 2019: EUR 341k).

In addition, other liabilities include a provision for outstanding invoices of EUR 4,675k (December 31, 2019: EUR 1,210k) which mainly relates to pandemic related invoices, personnel-related liabilities for vacation and bonuses totaling EUR 2,662k (December 31, 2019: EUR 2,264k), a VAT payable of EUR 963k (December 31, 2019: EUR 1,311k receivable), as well as liabilities for wage and church tax of EUR 478k (December 31, 2019: EUR 376k). Other liabilities as of September 30, 2020 do not include costs related to the July 2020 Offering, while other liabilities as of December 31, 2019 included costs relating to the IPO of EUR 565k.

12 Share-based payments

At September 30, 2020 the Group had the following share-based payment arrangements.

(i) Equity share option - Replacement (ESOP 2017)

In 2017, the Group established a second virtual share option program ("2017 VSOP”) that entitled the management board to grant virtual share options to individuals, in regard to services they provide and their continuous commitment to the Group.

For the nine months ended September 30, 2019, the Group recognized EUR 5,299k of share-based payment expense in the statement of comprehensive income in relation to the cash-settled virtual share option programs of Centogene GmbH, which were cancelled upon completion of IPO.

In connection with the IPO (see note 1), a transfer agreement was entered into between the holders of the 2017 VSOP, Centogene GmbH and the Company in November 2019, under which the 2017 VSOP was terminated, and the option holders were granted new share options of Centogene N.V. (“ESOP 2017”). This transaction was accounted for as a replacement, no incremental fair value arose on this transaction.

The number of options granted to each holder under ESOP 2017 was based on the number of options granted to them under 2017 VSOP and the IPO price of Centogene N.V. Accordingly, 805,308 new share options were granted pursuant to Centogene N.V’s long-term incentive plan (the “Long-term Incentive Plan”), with each option representing one common share of Centogene N.V., and an exercise price equal to the nominal value of the share of Centogene N.V., which is EUR 0.12.

The options were considered vested upon the completion of the IPO, but were not exercisable in the first 180 days subsequent to the listing (lock-up period).

The remaining contractual life for the share options as at September 30, 2020 is 9.25 years (December 31, 2019: 10 years).

The share options issued under ESOP 2017 are equity-settled and the fair value of the options were fully recognized in equity under capital reserve on the date of grant, i.e. at the replacement date.

(ii) Equity share option 2019 (ESOP 2019)

In 2019, an agreement was entered into between the Company and an individual of the Supervisory Board. According to this agreement, a total of 396,522 options, each option representing one common share, were granted pursuant to the Long-term Incentive Plan to the individual Supervisory Board member with exercise price equaling to the IPO price, which is EUR 12.58 per option, on the date of the IPO of the Company. The vesting period shall be three years commencing on the day of grant, where one-third of the granted options shall be vested at the end of each year of grant, and the first year ending on March 31, 2020.

The contractual life for the share options as at December 31, 2019 is ten years and the weighted average fair value of options outstanding was EUR 9.08. The share options issued under “ESOP 2019” will be equity-settled and the fair value of the options were recognized in equity under capital reserve, based on the fair value on the date of grant, and will be charged to profit or loss over the vesting period by using the graded vested approach. For the three and nine

months ended September 30, 2020, the Group recognized EUR 336k and EUR 1,728k respectively, of share-based payment expense in the statement of comprehensive income.

(iii) Long-Term Incentive Plan (LTIP)

In 2019, the Company established a Long-Term Incentive Plan (“LTIP”) that entitled the Supervisory Board or the Management Board, as applicable, to grant share-based awards to members of the Supervisory Board, members of the Management Board, employees, officers and certain other service providers. Under the LTIP, the maximum number of shares underlying awards made under the LTIP (excluding awards granted in replacement of other awards in connection with an acquisition, merger or business combination) shall not exceed 13% of the Company’s issued share capital immediately following the completion of the initial public offering of the Company's ordinary shares, provided that, on January 1, 2020 and on January 1 of each calendar year thereafter, such maximum number shall be increased with an additional number of shares equal to 3% of the Company’s issued share capital on such date (or any lower number of Shares as determined by the Supervisory Board).

Effective as of September 11, 2020, the Supervisory Board granted members of the Management Board the following options and restricted stock units ("RSUs") under the LTIP:

to the Company’s Chief Executive Officer: 36,175 Options and 72,350 RSUs;

to the Company’s Chief Financial Officer: 16,250 Options and 32,250 RSUs; and

to the Company’s Chief Information Officer: 15,000 Options and 30,000 RSUs.

Effective as of September 11, 2020, the Management Board granted 87,500 options and 75,000 RSUs to other key current and former executive officers.

Apart from one award that immediately vested in full on the grant date and another award that vests in three equal tranches on each anniversary of its date of first employment, all other awards referred to above shall vest in three equal tranches from January 1 following the grant date, in accordance with the following vesting schedule:

one third of the awards vest on January 1, 2021;

ii.

one third of the awards vest on January 1, 2022; and

iii.

one third of the awards vest on January 1, 2023.

All of the foregoing awards vest in full upon the occurrence of a change of control as defined by the LTIP, unless the holder is no longer eligible to participate in the LTIP at that time.

The options referred to above vest only if the 20-trading day volume-weighted average stock price of the Company's shares preceding the vesting date of each tranche exceeds the exercise price of USD 11.60. This hurdle is considered a market condition. Therefore, expenses would not be reversed, if the tranches do not ultimately vest. The RSUs referred to above have no performance-based vesting criteria. RSUs represent a right to receive a payment equal to the value of the RSU at the exercise date. The company has a choice to settle either in cash, in shares or a combination thereof. In line with this policy both types of awards are to be settled in shares and expire on the 10^th anniversary of the grant date.

The fair value of the options as of the grant date was determined using a Monte Carlo simulation model. The Monte Carlo simulation model utilizes multiple input variables to estimate the probability that market conditions will be achieved. The input variables include stock price volatility of 75% based on other public companies in the relevant industry, and risk-free interest rate of 0.8% to estimate the probability of satisfying the market conditions and the resulting fair value of the award.

For the three and nine months ended September 30, 2020, the Company recognized EUR 812k of share-based payment expenses in the statement of comprehensive income in relation to these awards under the LTIP plan.

13 Commitments

Future payments for non-cancellable leases

The Group has various lease contracts in relation to the expansion of the Rostock headquarters and leasing of the Frankfurt laboratory, Airport Berlin, Airport Düsseldorf, Airport Frankfurt and additional laboratory space in Hamburg. The future lease payments and utilities for these non-cancellable lease contracts are EUR 380k within one year, EUR 1,838k within five years and EUR 5,012k thereafter (December 31, 2019: EUR nil).

The Group has various non-cancellable lease contracts of office equipment and storage spaces which had a lease term of less than 12 months or were related to leases of low-value assets, and therefore the short-term lease recognition exemption was applied to these contracts. The future lease payments for these non-cancellable lease contracts are EUR 75k within one year (December 31,2019: EUR 72k) and EUR 23k within five years (December 31, 2019: EUR 36k).

Future payment obligations

As of September 30, 2020, the Group concluded agreements with suppliers, for goods and services to be provided subsequent to September 30, 2020 with a total payment obligation of approximately EUR 7,131k (December 31, 2019: EUR 802k).

14 Contingent Liabilities

In May 2016, the Company was informed in writing by the Universitair Medisch Centrum Utrecht (‘‘UMCU’’) that a claim had been initiated against UMCU regarding a prenatal diagnostic test that the Company conducted at their request which failed to identify a specific mutation present in a patient. On November 8, 2018, the UMCU and Neon Underwriting Limited formally filed a legal claim in the local court in Rostock, Germany against the Company alleging that the Company’s negligence in performing the test resulted in the misdiagnosis of the patient. UMCU is seeking recovery for compensatory damages as a result of the alleged misdiagnosis. By court order of November 8, 2018 the Regional Court of Rostock set the amount in dispute at EUR 880k.

On November 12, 2018, the Company submitted a notice to the Regional Court of Rostock of the intention to defend against the claim. On January 3, 2019, the Company filed a motion to dismiss in which the Company denied the merits of the claim. UMCU and Neon Underwriting Limited responded to this motion on March 15, 2019 with a statement of reply, and the parties made several court filings setting out their arguments since. By order dated June 3, 2019, the Regional Court of Rostock provided a first set of questions to be answered by an expert witness. Following a request by the Court, the Director of the Institute of Genetics at the University of Bonn recommended a professor for human genetics from the University of Aachen be appointed as an expert witness in this case. The Company agreed to such recommendation.

As of September 30, 2020, the dispute amount was EUR 1.3 million. The claim was assigned to a new judge, due to an illness of the preceding judge, while the decision to appoint the recommended expert witness has not yet been finalized.

The Company intends to continue to rigorously defend its position and considers that it is not probable the legal claim towards the Company will be successful and as a result has not recognized a provision for this claim as of September 30, 2020. In addition, in case a settlement would be required, the Company believes that the corresponding liability will be fully covered by the respective existing insurance policies.

The higher regional court of Rostock issued a final decision by which it renders a contract entered into between the State of Mecklenburg-Western Pomerania (“MVP”) and the Company for Corona testing as invalid with retroactive effect under a public procurement litigation case. Under this contract, the Company has invoiced and received a total amount of EUR 2.3 million. Since the contract was rendered invalid, MVP now has a claim under German law against the Company for repayment of the full amount invoiced and received. The Company at the same time has a claim against MVP for compensation for the value of services provided in expectation of the validity of the contract.

In the typical scenario, the amounts of these two claims would equal each other and could be offset against each other. However, there can be no assurance that MVP will take the view that the amount of its claim equals and offsets the amount of the Company’s claim. To the extent MVP’s claim exceeds the Company’s claim against MVP, Centogene may ultimately have a payment obligation, which could materially adversely affect the Group’s financial position and results of operations.

15 Subsequent Events

Leadership transition

On October 20, 2020 the Company announced that Prof. Arndt Rolfs, the Company’s founder and former Chief Executive Officer (CEO), has decided to step down as CEO of Centogene as of October 20, 2020, and that Andrin Oswald, M.D., will join the Company as CEO effective December 1, 2020. Prof. Rolfs has agreed to serve as an advisor during the transition period until December 31, 2020.

The financial impact of the departure of Prof. Rolfs, in the fourth quarter of 2020, are additional expenses relating to one full year’s base salary aggregating to EUR 565k, as well as additional share-based payment expenses of EUR 162k and EUR 620k respectively relating to all LTIP options and RSUs granted in 2020 that would vest immediately.

LTIP grant of restricted stock units

In October 2020, 251,500 RSUs granted to employees were issued, subject to the terms of the LTIP, the applicable award agreement and the terms specified in the authorization from the Supervisory Board for this purpose. The awards will vest in three equal tranches over a three-year period from January 1, 2021 to January 1, 2023.

Exhibit 99.3

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of our financial condition and results of operations should be read in conjunction with Centogene N.V.’s unaudited interim condensed consolidated financial statements as of December 31, 2019 and September 30, 2020 and for the three and nine months ended September 30, 2019 and 2020 included as Exhibit 99.2 to this report on Form 6-K. We also recommend that you read our management’s discussion and analysis and our audited consolidated financial statements and the notes thereto included in our annual report for the year ended December 31, 2019 on Form 20-F, filed with the U.S. Securities and Exchange Commission (the “SEC”) pursuant to the U.S. Securities and Exchange Act of 1934, as amended, on April 23, 2020 (the “Annual Report”).

Unless otherwise indicated or the context otherwise requires, all references to “Centogene N.V.” or the “Company,” “we,” “our,” “ours,” “us” or similar terms refer to Centogene N.V. and its subsidiaries.

The following discussion is based on our financial information prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”), which may differ in material respects from generally accepted accounting principles in the United States and other jurisdictions.

This discussion and analysis is dated as of December 16, 2020.

Overview

We are a commercial-stage company focused on rare diseases that transforms real-world clinical and genetic data into actionable information for patients, physicians and pharmaceutical companies. Our goal is to bring rationality to treatment decisions and to accelerate the development of new orphan drugs by using our knowledge of the global rare disease market, including epidemiological and clinical data and innovative biomarkers. We have developed a global proprietary rare disease platform based on our real-world data repository with over 3.6 billion weighted data points from approximately 595 thousand patients representing 120 different countries as of September 30, 2020, or an average of over 660 data points per patient. Our platform includes multiomic data (such as epidemiologic, phenotypic, proteomic, metabolomic and genetic data) that reflects a global population, and also a biobank of these patients’ blood samples. We believe this represents the only platform that comprehensively analyzes multi-level data to improve the understanding of rare hereditary diseases, which can aid in the identification of patients and improve our pharmaceutical partners’ ability to bring orphan drugs to the market.

We have identified three reportable segments:

· Pharmaceutical. Our pharmaceutical solutions provide a variety of services to our pharmaceutical partners, including target discovery, early patient recruitment and identification, epidemiological insights, biomarker discovery and patient monitoring. Our information platforms, access to rare disease patients and their biomaterials, and ability to develop proprietary technologies and biomarkers enable us to provide services to our pharmaceutical partners in all phases of the drug development process as well as post-commercialization. Revenues from our pharmaceutical segment are generated primarily from collaboration agreements with our pharmaceutical partners. As of September 30, 2020, we collaborated with over 40 pharmaceutical partners for over 45 different rare diseases. In addition, out of the over 60 single biomarker development programs as of September 30, 2020, 33 were used in connection with our pharmaceutical collaborations. Since early 2020, we also started to pursue a metabolomics approach for establishing a biomarker discovery pipeline for rare hereditary disease. Our new approach includes a tandem mass spectrometry (ion mobility quadrupole time-of-flight mass spectrometry) methodology and artificial intelligence and, combined with the large volume of datasets in our global rare disease platform, has proven successful in the identification of new biomarkers. The new biomarker candidates identified are then further validated and optimized in epidemiological clinical trials.

· Diagnostics. Our diagnostics segment provides targeted genetic sequencing and diagnostics services to our clients worldwide, who are typically physicians, laboratories or hospitals, either directly or through distributors. As of September 30, 2020, we believe we offer the broadest diagnostic testing portfolio for rare diseases, covering over 7,500 genes using over 10,000 different tests. In turn, the data collected from our diagnostics services and biomaterials allow us to continue to grow our repository and our CentoMD database.

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COVID-19 testing. Due to the growth and significance of our COVID-19 business in relation to our total activities, our COVID-19 testing business has been managed and reported as a separate segment beginning in the third quarter of 2020. We started offering COVID-19 testing in March 2020. Our original COVID-19 test was a molecular diagnostic test performed for the in vitro qualitative detection of RNA from the SAR-CoV-2 in oropharyngeal samples from presymptomatic probands according to the recommended testing by public health authority guidelines. It has also been validated in CENTOGENE’s

CAP/CLIA/ISO certified analytical laboratory and has received Emergency Use Authorization (EUA) by the United States Food and Drug Administration (FDA) for use by authorized laboratories. The majority of these tests are performed in airport locations and currently offered at the Frankfurt, Hamburg, Düsseldorf, and Berlin airports. To date, our COVID-19 tests are offered free of charge as additional measures to protect our employees as well as initiatives to support the community to overcome the challenges of the pandemic, while the billable tests are mainly offered through collaborations with the state government and other companies.

In the three months ended September 30, 2020, we received over 431 thousand total test requests, of which 400 thousand account for COVID-19 tests. Excluding the COVID-19 test requests, we received 31 thousand test requests in the three months ended September 30, 2020, representing a 9.0% decrease as compared to the three months ended September 30, 2019. In the nine months ended September 30, 2020, we received approximately 552 thousand test requests, of which over 470 thousand account for our COVID-19 tests. Excluding the COVID-19 test requests, we received 82 thousand test requests in the nine months ended September 30, 2020, representing a 14.8% decrease as compared to approximately 97 thousand test requests received in the nine months ended September 30, 2019.

Our revenue for the three months ended September 30, 2020 was €36,305 thousand, an increase of €24,667 thousand, or 212.0%, from €11,638 thousand for the three months ended September 30, 2019. Our pharmaceutical, diagnostics and Covid-19 segments contributed 10.4%, 14.0% and 75.6%, respectively, of our total revenues for the three months ended September 30, 2020, as compared to 41.5% and 58.5% for the pharmaceutical and diagnostics segments, respectively, of our total revenues for the three months ended September 30, 2019. Test requests received by our pharmaceutical segment in the three months ended September 30, 2020 were 18 thousand, representing a decrease of 5.3% as compared to 19 thousand test requests received in the three months ended September 30, 2019. Test requests received by our diagnostics segment in the three months ended September 30, 2020, was 10 thousand, representing a decrease of 16.8% as compared to 12 thousand in the three months ended September 30 2019.

Our revenue for the nine months ended September 30, 2020 was €58,129 thousand, an increase of €24,570 thousand, or 73.2%, from €33,559 thousand for the nine months ended September 30, 2019. Our pharmaceutical, diagnostics and Covid-19 segments contributed 21.1% and 50.8%, respectively, of our total revenues for the nine months ended September 30, 2020, as compared to 40.3% and 59.7% for our pharmaceutical and diagnostic segments, respectively, of our total revenues for the nine months ended September 30, 2019. Test requests received by our pharmaceutical segment in the nine months ended September 30, 2020 were 46 thousand, representing a decrease of 8.8% as compared to 50 thousand test requests received in the nine months ended September 30, 2019. Test requests received by our diagnostics segment in the nine months ended September 30, 2020, were 30 thousand representing a decrease of 20.9% as compared to 38 thousand test requests received in the nine months ended September 30, 2019.

Since the inception of our business, our research and development has been substantially devoted to our biomarkers, knowledge-based platform and interpretation-based solutions. For the three months ended September 30, 2020, we incurred research and development expenses of €4,796 thousand, an increase of €2,785 thousand, or 138.5%, from €2,011 thousand for the three months ended September 30, 2019. We received 3 thousand test requests for our internal research and development projects in both of the three months ended September 30, 2020 and 2019. For the nine months ended September 30, 2020, we incurred research and development expenses of €10,606 thousand, an increase of €4,487 thousand, or 73.3%, from €6,119 thousand for the nine months ended September 30, 2019. During the nine months ended September 30, 2020 and 2019, we received 9 thousand and 7 thousand test requests for our internal research and development projects, respectively.

For the three months ended September 30, 2020, our loss before taxes was €5,537 thousand, an increase of €1,261 thousand, or 29%, from €4,276 thousand for the three months ended September 30, 2019. For the nine months ended September 30, 2020, our loss before taxes was €24,504 thousand, an increase of €8,828 thousand, or 56%, from €15,676 thousand for the nine months ended September 30, 2019.

Recent Developments

Effect of the COVID-19 Pandemic

The COVID-19 pandemic, which began in December 2019, has spread worldwide and continues to cause many governments to maintain measures to slow the spread of the outbreak through quarantines, travel restrictions, closures of borders and mandatory maintenance of physical distance between individuals. We have been continuously monitoring the situation and have taken a series of measures to protect our employees and safeguard our operations.

As part of the Company’s initiative to assist local, national and international authorities as well as other partners in their efforts to facilitate the earliest possible diagnosis of COVID-19 and thereby contribute to allowing society to return to a ‘‘new’’ normal, the Company commenced testing for COVID-19 in March 2020. We offer a comprehensive and high quality COVID-19 testing solution to the community. This includes our COVID-19 tests, which received EUAs from the FDA in July 2020; our CentoKit-19, a fully

validated sample collection kit which can either be used by healthcare professionals or self-administered by individuals; and our Corona Test Portal, a secure digital platform following stringent data privacy measures in compliance with the General Data Protection Regulation (GDPR) and the Health Insurance Portability and Accountability Act (HIPAA), allowing seamless registration and result notification.

Starting from the Mecklenburg-Western Pomerania region of Germany, where we focused on employees and essential workers in Rostock, our COVID-19 testing solution was further expanded to nursing homes as well as to high school students in Germany, and has been available to the rest of the world since May 2020. Some of our tests are offered free of charge by the Company, others are offered in collaboration with the state governments and other partners. In particular, we expanded our COVID-19 testing business during the three months ended September 30, 2020:

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We launched our testing kits, CentoKit-19 in July 2020. The CentoKit-19 consists of a CE-labelled CentoSwab (a two-component dry plastic swab for oropharyngeal swab sampling), a collection tube with barcode sticker, and labelled and prepaid return. It is designed for sale to end consumers via marketplaces including Amazon Germany.

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In August 2020, we opened an additional walk-in testing facility at Hamburg Airport offering COVID-19 testing to passengers departing from and returning to Hamburg as well as to the general public.

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Since August 2020, we operate mobile test centers in the government districts of Upper Palatinate, Upper Franconia, and Lower Franconia in the Free State of Bavaria.

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In September 2020, we opened an additional walk-in testing facility at Düsseldorf Airport offering COVID-19 testing to passengers departing from and returning to Düsseldorf as well as to the general public.

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As of September 2020, we offered COVID-19 testing to employees and residents of day care facilities in the federal state of Hamburg as part of a three month project.

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During September 2020, additional test centers were opened at Munich and Nuremberg Central Stations offering COVID-19 tests to travelers, including returning travelers from “high risk regions” as defined by the Robert Koch Institute (RKI), the public health agency which compiles the COVID-19 statistics in Germany.

Given the increasing focus of management on the development of our COVID-19 related testing business, we identified this business as a separate segment.

To support the expansion of our COVID-19 test offerings, the Company, in April 2020, acquired laboratory facilities and equipment for a total consideration of €1.8 million and leased laboratory space in Hamburg, Germany. Subsequently, in July 2020, the Company leased further laboratory space in Frankfurt, Germany. Additional COVID-19 testing capacity is provided through our custom-build CentoTruck, a mobile laboratory in a container setup to carry out COVID-19 analyses. Total investments in COVID-19 testing as of September 30, 2020 amounted to approximately €6.3 million, of which approximately €4.8 million and €0.6 million, respectively, are included in property, plant and equipment and right-of-use assets. An amount of €0.9 million is included in intangible assets and relates to the development of the Corona Test Portal. In addition, we have secured the production and supply of a sample collection kit for COVID-19 tests, CentoSwab.

Due to the measures implemented to control the further spread of the outbreak, including “social distancing”, as well as the allocation of healthcare resources to treating those infected with the virus, we have seen a significant decrease in our sample volume related to our routine diagnostics business and pharmaceutical collaborations with fee per sample structure. In addition, the pandemic also slowed the progress of the clinical studies of our pharmaceutical partners with whom we collaborate, which adversely affected our pharmaceutical business. In addition, travel restrictions and the cancellation of conferences and seminars also delayed the conclusion of new collaborations with our pharmaceutical partners.

Although we are taking a number of measures aimed at minimizing disruptions to our business and operations, and while the provision of testing for the COVID-19 virus is anticipated to generate additional revenues for us, the full extent to which the global COVID-19 pandemic may impact our business will depend on future developments, which are highly uncertain and cannot be predicted, such as the duration of the pandemic, the availability of vaccines, the probability of the occurrence of further outbreaks and the ultimate impact on the financial markets and the global economy, and could result in an unforeseen negative impact on our business and our future results of operations.

Research and Development

Despite the disruption from the COVID-19 pandemic, we continued to expand our medical and genetic knowledge of rare genetic diseases, with the vision of shortening the diagnostics odyssey of rare disease patients and accelerating the development of new orphan drugs. In particular, we entered into the following collaborations subsequent to the three months ended September 30, 2020:

· Collaboration with PTC Therapeutic, Inc (“PTC”) to expand our existing partnership to several new regions including many countries in Europe, the Middle East, and Latin America to provide genetic testing and 3-O-Methyldopa (3-OMD) biomarker analytics to help identify patients with Aromatic L-amino Acid Decarboxylase (AADC) deficiency.

· Collaboration with Alnylam Pharmaceuticals (“Alnylam”) to expand its existing epidemiology and biomarker work through the initiation of a new clinical program (TRAMoniTTR) focused on Hereditary Transthyretin Amyloidosis (hATTR, hereditary amyloidosis, transthyretin-related). Through the newly executed agreement, the Company will provide specific analyses regarding anonymized TTR patient populations with a focus on long-term longitudinal data.

As of September 30, 2020, our global proprietary rare disease platform included real-world data repository with approximately 595 thousand patients representing 120 different countries, an increase of 28.0% as compared to the number of patients in our platform as of September 30, 2019.

We also released an update of CentoLSD, powered by CentoMD, which we believe is the world’s largest knowledge-driven lysosomal storage disease (“LSD”) database. CentoLSD allows researchers, pharmaceutical partners, and clinicians to access a comprehensive database of GBA and GLA genetic variants classified through a standardized curation workflow, and is accessible through our website free of charge, for the purpose of enhancing a global understanding and the potential treatment opportunities for rare disease patients.

Follow-on Equity Offering

In July 2020, we completed a follow-on public offering of 3,500,000 common shares of the Company (the “Follow-on Equity Offering”), consisting of 2,000,000 common shares offered by the Company and 1,500,000 common shares offered by selling shareholders at a price to the public of $14.00 per common share (i.e., €12.71 per share). Aggregate offering proceeds, net of underwriting discounts, commissions and transaction costs, to the Company were €22 million. With the additional funding from the Follow-on Equity Offering, we believe that our cash and cash equivalents will enable us to fund our operating expenses and capital expenditure requirements for more than 12 months.

Leadership transition

On October 20, 2020, we announced that Prof. Arndt Rolfs, our founder and Chief Executive Officer (CEO), had decided to step down as CEO of Centogene as of October 20, 2020, and that Andrin Oswald, M.D., would join the Company as CEO effective December 1, 2020. Prof. Rolfs has agreed to serve as an advisor during the transition period until December 31, 2020.

The financial impact of the departure of Prof. Rolfs, in the fourth quarter of 2020, are additional expenses related to one full year’s base salary aggregating to €565 thousand, as well as additional share-based payment expenses of €162 thousand and €620 thousand, respectively, relating to all Long-Term Incentive Plan options and restricted stock units granted in 2020 that would vest immediately.

Financial Operations Overview

Our revenue is principally derived from the provision of pharmaceutical solutions and diagnostic tests enabled by our knowledge and interpretation-based platform, as well as from our COVID-19 testing solution.

Besides the recent impact of our COVID-19 testing solution related revenue, we expect our revenue to increase over time as we continue to expand our commercial efforts internationally with a focus on further growth in our pharmaceutical segment. We expect revenue from our diagnostics segment to grow in absolute terms but decrease as a percentage of total revenue if there is growth in our pharmaceutical segment. The development of the COVID-19 testing revenues will strongly depend on the further development of the COVID-19 pandemic.

Changes in revenue mix between our pharmaceutical, diagnostics and COVID-19 segments can impact our results period over period. We typically incur lower costs for the provision of solutions in our pharmaceutical segment and therefore generate higher returns from our pharmaceutical segment contracts than from our diagnostics and COVID-19 segments contracts.

For a discussion of our other key financial statement line items, please see “Item 5—Operating and Financial Review and Prospects—Operating Results—Financial Operations Overview” in our Annual Report.

Results of Operations

Three and Nine Months Ended September 30, 2020 Compared to Three and Nine Months Ended September 30, 2019


	For the Three Months Ended		For the Nine Months Ended
	September 30,		September 30,
	2019	2020	2019	2020

	(unaudited,
	€ in thousands)
Condensed consolidated statement of comprehensive loss:
Revenue	11,638	36,305	33,559	58,129
Cost of sales	6,641	26,059	19,499	39,892
Gross profit	4,997	10,246	14,060	18,237
Research and development expenses	2,011	4,796	6,119	10,606
General administrative expenses	4,884	8,373	16,487	24,038
Selling expenses	1,788	1,300	6,144	6,012
Impairment of financial assets	92	1,147	554	2,821
Other operating income	935	679	2,623	2,425
Other operating expenses	—	53	2	191
Real estate transfer tax expenses	—	—	1,200	—
Operating loss	(2,843)	(4,744)	(13,823)	(23,006)
Interest and similar income	—	—	12	6
Interest and similar expenses	1,433	793	1,865	1,504
Finance costs, net	(1,433)	(793)	(1,853)	(1,498)
Loss before taxes	(4,276)	(5,537)	(15,676)	(24,504)
Income tax expenses	—	103	163	232
Loss for the period	(4,276)	(5,640)	(15,839)	(24,736)
Other comprehensive income/(loss)	(1)	(66)	9	4
Total comprehensive loss for the period	(4,277)	(5,706)	(15,830)	(24,732)
Attributable to:
Equity holders of the parent	(4,247)	(5,708)	(15,674)	(24,671)
Non-controlling interests	(30)	2	(156)	(61)
	(4,277)	(5,706)	(15,830)	(24,732)

Loss per share – Basic and diluted (in €)	(0.27)	(0.27)	(0.99)	(1.20)

Revenue

Our total revenues for the three and nine months ended September 30, 2020 were €36,305 thousand and €58,129 thousand, respectively, representing increases of €24,667 thousand and €24,570 thousand, respectively, or 212.0% and 73.2%, respectively, as compared to the three and nine months ended September 30, 2019.

The graphic below shows the number of test requests for the diagnostics segment (excluding COVID-19 tests) and pharmaceutical segment, as well as the number of test requests received for our internal research projects during the three and nine months ended September 30, 2019 and 2020.

The breakdown of our revenue by segment was as follows:


	For the Three Months		For the Nine Months
	Ended September 30,		Ended September 30,
	2019	2020	2019	2020

	(unaudited,
	€ in thousands)
Revenue by segment:
Pharmaceutical	4,833	3,800	13,531	12,290
Diagnostics	6,805	5,069	20,028	16,308
Covid-19	—	27,436	—	29,531
Total Revenue	11,638	36,305	33,559	58,129

Pharmaceutical segment

Revenues from our pharmaceutical segment were €3,800 thousand for the three months ended September 30, 2020, a decrease of €1,033 thousand, or 21.4%, from €4,833 thousand for the three months ended September 30, 2019. Our partnership agreements are structured on a fee per sample basis, milestone basis, fixed fee basis, royalty basis or a combination thereof. The 21.4% decrease was primarily due to the impact of the COVID-19 pandemic, which slowed the clinical studies of our pharmaceutical partners.

Revenues from our pharmaceutical segment were €12,290 thousand for the nine months ended September 30, 2020, a decrease of €1,241 thousand, or 9.2%, from €13,531 thousand for the nine months ended September 30, 2019.

The total number of active/completed collaborations in the nine months ended September 30, 2020 amounted to 63, as compared to 63 in the nine months ended September 30, 2019. As of September 30, 2020, we collaborated with 41 pharmaceutical partners, as compared to 38 pharmaceutical partners as of September 30, 2019.

The graphs below show our revenues for the three and nine months ended September 30, 2020 and 2019, resulting from our collaborations with our pharmaceutical partners, split between drug development stages, as well as between different fee structures:

Revenues from our collaborations which are structured on a fixed fee basis represented 6.7% and 13.0%, respectively, of our total revenues for the three and nine months ended September 30, 2020, as compared to 62.9% and 36.8%, respectively, for the three and nine months ended September 30, 2019. Given the fee structure, these revenues provide us with stable revenues and cashflow from the pharmaceutical segment. As new and existing clinical trials were slowed down or put on hold, the COVID-19 pandemic had a more significant impact on those of our collaborations that are structured on a fee per sample basis. Revenues from fee per sample collaborations were €0.1 million and €1.1 million, respectively, for the three and nine months ended September 30, 2020, and decreased by 83.7% and 38.1%, respectively, as compared to the same periods in 2019. Revenues from the fee per sample collaborations represented 2.5% and 9.1%, respectively, of our total revenues for the pharmaceutical segment for the three and nine months ended September 30, 2020 and decreased by 9.4 percentage points and 4.3 percentage points, respectively, compared to the same periods in 2019.

During the nine months ended September 30, 2019, we entered into two collaborations with an existing pharmaceutical partner, of which upfront fees of €430 thousand, representing the transaction price allocated to the one-off transfer of the Group’s intellectual property were received and recognized as revenues. No such revenues were recognized in the three and nine months ended September 30, 2020 and the three months ended September 30, 2020.

During the three and nine months ended September 30, 2020, revenues from one pharmaceutical partner represented 7.3% and 14.4%, respectively, of our total revenue, as compared to 25.4% and 26.5%, respectively, for the three and nine months ended September 30, 2019.

Diagnostics segment

Revenues from our diagnostics segment were €5,069 thousand for the three months ended September 30, 2020, a decrease of €1,736 thousand, or 25.5%, from €6,805 thousand for the three months ended September 30, 2019. Revenues from our diagnostics segment were €16,308 thousand for the nine months ended September 30, 2020, a decrease of €3,720 thousand, or 18.6%, from €20,028 thousand for the nine months ended September 30, 2019.

The decreases were mainly due to decreases in test requests for all our primary rare disease testing products (i.e., standard genetic testing including single gene, CNV and mutation quantification products, panel sequencing, whole exome sequencing (“WES”) and whole genome sequencing (“WGS”), and biochemistry) as a result of the COVID-19 pandemic. The decreases were also attributable to decreases in test requests for our non-invasive pre-natal testing (“NIPT”), a non-core diagnostics product, which we intend to continue lowering the volume of, to focus more on the testing products that provide a larger quantity of data, such as WES and WGS, to continue growing our rare disease platform repository.

The graph below shows the test requests received in the diagnostics segment, split between primary rare disease testing products, for the three and nine months ended September 30, 2020 and 2019:

For the three and nine months ended September 30, 2020 and 2019, our total diagnostics segment revenues from our primary rare disease testing products were as follows:

The revenues for the diagnostics segment are recognized over time by reference to the percentage of completion of the service on the reporting date, assessed on the basis of the work rendered. The 29.1% decrease in revenues from our primary rare disease tests for the three months ended September 30, 2020, was primarily driven by the decrease in test requests across all testing products by 24.1% as compared to the three months ended September 30, 2019. In particular, the decreases in test requests and revenues from our NIPT (non-core and relatively low price product) were 24.7% and 14.0%, respectively, for the three months ended September 30, 2020 as compared to the same period ended September 30, 2019 reflecting our strategy of moving towards testing products that provide a larger quantity of data. The total number of WES and WGS test requests received in the diagnostics segment for the three months ended September 30, 2020, was approximately 2,827, representing 26.3% of total test requests for the period, and representing an increase of 0.7 percentage points as compared to the proportion of WES and WGS received over the total test requests received for the three months ended September 30, 2019.

The 12.3% decrease in revenues from our primary testing products for the nine months ended September 30, 2020, was in line with the decrease in test requests by 18.5% as compared to the nine months ended September 30, 2019, of which test requests and revenues from our NIPT decreased by 47.9% and 32.3%, respectively, for the nine months ended September 30, 2020 as compared to the same period ended September 30, 2019. On the other hand, the total number of WES and WGS test requests received in the diagnostics segment for the nine months ended September 30, 2020 increased by 6.2% to 10,804 test requests, from approximately 10,170 test requests received for the nine months ended September 30, 2019. The total number of WES and WGS test requests received in the diagnostics segment for the nine months ended September 30, 2020 represented 29.7% of total primary rare disease test requests for the period, a 6.9 percentage points increase as compared to the proportion of WES and WGS received over the total test requests for the nine months ended September 30, 2019.

COVID-19 testing segment

Revenues generated from the testing for COVID-19 and sales of CentoSwab for the three and nine months ended September 30, 2020 amounted to €27,436 thousand, and €29,531 thousand, respectively, and beginning in the third quarter of 2020, are included in a separate segment. We received 400 thousand and over 470 thousand test requests, respectively, for our COVID-19 tests in the three and nine months ended September 30, 2020.

The breakdown of our revenue from all of our segments, in the aggregate, by geographical region was as follows:


	For the Three Months		For the Nine Months
	Ended September 30,		Ended September 30,
	2019	2020	2019	2020

	(unaudited,
	€ in thousands)
Revenue by geographical region:
Europe	1,963	28,824	5,655	33,711
of which: Germany	96	26,640	424	28,847
of which: Netherlands	—	2	—	5
Middle East	3,407	2,674	10,178	8,926
North America	5,140	4,265	14,818	13,762
of which: United States	5,122	4,231	14,452	13,570
Latin America	829	399	2,148	1,364
Asia Pacific	299	143	760	366
Total Revenue	11,638	36,305	33,559	58,129

In cases where our pharmaceutical partners are developing a new rare disease treatment, we generally anticipate that the final approved treatment will be made available globally. As a result, we allocate the revenues of our pharmaceutical segment by geographical region by reference to the location where each pharmaceutical partner mainly operates, which is based on the region from which most of their revenues are generated. The allocation of revenues in our diagnostics segment is based on the location of each customer.

Our North America region contributed €4,265 thousand to revenues for the three months ended September 30, 2020, a decrease of €875 thousand, or 17.0%, from €5,140 thousand for the three months ended September 30, 2019, primarily driven by the decrease in revenues from our pharmaceutical segment, of which over 98.3% are allocated to the North America region. Revenues from the North America region for the nine months ended September 30, 2020, decreased to €13,762 thousand, representing a decrease of €1,056 thousand, or 7.1%, from €14,818 thousand, which is mainly due to a decrease in revenues from the pharmaceutical segment by €1,062 thousand, or 8.1%, as compared to the nine months ended September 30, 2019. Revenues from the North America region represented 11.7% and 23.7%, respectively, of our total revenues for the three and nine months ended September 30, 2020, as compared to 44.2% and 44.2%, respectively, for the three and nine months ended September 30, 2019.

Our Middle East region contributed €2,674 thousand to revenues for the three months ended September 30, 2020, a decrease of €733 thousand, or 21.5%, from €3,407 thousand for the three months ended September 30, 2019. This was primarily attributable to the decrease in test requests received in our diagnostics segment by 19.8% in the three months ended September 30, 2020, as compared to the three months ended September 30, 2020. The negative impact of the diagnostics segment in the Middle East region was partially offset by the increase in revenues in the first quarter of 2020. As a result, revenues from the Middle East region for the nine months ended September 30, 2020 only decreased by €1,252 thousand, or 12.3%, to €8,926 thousand from €10,178 thousand for the nine months ended September 30, 2020. Revenues from the Middle East region represented 7.4% and 15.4%, respectively, of our total revenues for the three and nine months ended September 30, 2020, as compared to 29.3% and 30.3%, respectively, for the three and nine months ended September 30, 2019.

Our Europe region contributed €28,824 thousand and €33,711 thousand, respectively, to revenues for the three and nine months ended September 30, 2020, representing increases of 1368.4% and 496.1%, respectively, as compared to the three and nine months ended September 30, 2019. The increases were mainly driven by revenues from our COVID-19 testing during the period, as over 97% of such revenues were generated in Germany in the three and nine months ended September 30, 2020. Revenues from the Europe region represented 79.4% and 58.0% respectively, of our total revenues for the three and nine months ended September 30, 2020, as compared to 16.9% and 16.9%, respectively, for the three and nine months ended September 30, 2019.

Cost of Sales

Cost of sales increased by €19,418 thousand, or 292.4%, to €26,059 thousand for the three months ended September 30, 2020, from €6,641 thousand for the three months ended September 30, 2019, and increased by €20,393 thousand, or 104.6%, to €39,892 thousand for the nine months ended September 30, 2020, from €19,499 thousand for the nine months ended September 30, 2019. Cost of sales for the three and nine months ended September 30, 2020 represented 71.8% and 68.6%, respectively, of total revenue, representing increases of 14.7 percentage points and 10.5 percentage points, respectively, as compared to 57.1% and 58.1%, respectively, for the three and nine months ended September 30, 2019.

Cost of sales incurred by our pharmaceutical segment for the three and nine months ended September 30, 2020 represented 85.4% and 54.5%, respectively, of the revenues from the segment, representing increases of 60.8 percentage points and 30.4 percentage

points, respectively, as compared to 24.6% and 24.1%, respectively, for the three and nine months ended September 30, 2019 for our pharmaceutical segment. The increases were mainly due to a relatively larger portion of revenues from clinical study related collaborations, where higher staff costs and consumable costs are incurred as compared to patient screening collaborations in the past where the consumable costs were comparatively low due to different technologies being used in the testing.

Cost of sales incurred by our diagnostics segment for the three months ended September 30, 2020 represented 94.4% of the revenues from the segment, representing an increase of 14.3 percentage points as compared to 80.1% for the three months ended September 30, 2019. The increase was mainly due to the reallocation of some of the fixed costs incurred for the segment, such as depreciation of laboratory equipment, as well as personnel costs for employees for laboratory operations to the COVID-19 segment where such costs were incurred.

Cost of sales incurred by our diagnostics segment for the nine months ended September 30, 2020 represented 84.4% of the revenues from the segment, representing a increase of 3.3 percentage points as compared to 81.1% for the nine months ended September 30, 2019 for our diagnostics segment. The decrease was mainly due to reallocation of some of the fixed costs incurred for the segment, such as depreciation of laboratory equipment, as well as personnel costs for employees for laboratory operations to the COVID-19 segment where such costs were incurred. The decrease was further caused by the change in the Diagnostics product mix, with fewer NIPT tests (which have comparatively higher costs per test) performed in the nine months ended September 30, 2020.

Cost of sales incurred by our COVID-19 segment for the three months and nine months ended September 30, 2020 represent 65.7% and 65.7% of the revenues for the segment, respectively.

Gross Profit

As a result of the above factors, our gross profit increased by €5,249 thousand, or 105%, to €10,246 thousand for the three months ended September 30, 2020, from €4,997 thousand for the three months ended September 30, 2019, while our gross profit for the nine months ended September 30, 2020, increased by €4,177 thousand, or 29.7%, to €18,237 thousand from €14,060 thousand for the nine months ended September 30, 2019.

Research and Development Expenses

Research and development expenses increased by €2,785 thousand, or 138.5%, to €4,796 thousand for the three months ended September 30, 2020, from €2,011 thousand for the three months ended September 30, 2019, while our research and development expense increased by €4,487 thousand, or 73.3%, to €10,606 thousand for the nine months ended September 30, 2020, from €6,119 thousand for the nine months ended September 30, 2019. This mainly represents personnel costs, consumable costs and IT-related expenses incurred in the research phase that do not qualify for capitalization, or costs incurred for updates or improvements of our biomarkers, databases and technology platform for which development is completed.

General Administrative Expenses

General administrative expenses increased by €3,489 thousand, or 71.4%, to €8,373 thousand for the three months ended September 30, 2020, from €4,884 thousand for the three months ended September 30, 2019, while general administrative expenses increased by €7,551 thousand, or 45.8%, to €24,038 thousand for the nine months ended September 30, 2020, from €16,487 thousand for the nine months ended September 30, 2019.

The increases were principally due to an increase in personnel costs and operating expenses as a result of the expansion of the business. The increase was also largely due to costs of operating as a public company, such as additional legal, accounting, corporate governance and investor relations expenses, and higher directors’ and officers’ insurance premiums.

Share-based compensation expenses for the three and nine months ended September 30, 2019 were calculated based on the estimated fair values of the share-based awards as of September 30, 2019, as well as the estimated number of awards expected to vest. The share-based compensation expenses for the three and nine months ended September 30, 2020 were based on the estimated fair values of the share-based awards at the grant date.

Selling Expenses

Selling expenses for the three and nine months ended September 30, 2020 were €1,300 thousand and €6,012 thousand respectively, representing a decrease of €488 thousand, or 27.3% as compared to €1,788 thousand for the three months ended September 30, 2019, and a decrease of €132 thousand, or 2.1%, as compared to €6,144 thousand for the nine months ended September 30, 2019. The decreases for the three and nine months ended September 30, 2020 were mainly due to a reduction in expenses

incurred for conferences and exhibitions due to travel restrictions and other social-distancing measures, partly offset by the expansion of our business development team for the pharmaceutical segment.

Impairment of financial assets

Impairment expenses for financial assets for the three and nine months ended September 30, 2020 were €1,147 thousand and €2,821 thousand respectively, representing increases of €1,055 thousand from €92 thousand for the three months ended September 30, 2019, and €2,267 thousand from €554 thousand for the nine months ended September 30, 2019, respectively. These impairment losses related to the re-assessment of the receivables and contract assets arising from contracts with customers, partly due to the effect of the COVID-19 pandemic.

Other Operating Income / (Expenses)

Other operating income decreased by €256 thousand, or 27.4%, to €679 thousand for the three months ended September 30, 2020, from €935 thousand for the three months ended September 30, 2019, and decreased by €198 thousand, or 7.5%, to €2,425 thousand for the nine months ended September 30, 2020, from €2,623 thousand for the nine months ended September 30, 2019, principally due to lower grant income received during the periods.

Other operating expenses increased by €53 thousand and €189 thousand in the three and nine months ended September 30, 2020, compared to the three and nine months ended September 30, 2019.

Interest and Similar Income / (Expenses)

Net financial costs decreased by €640 thousand and €355 thousand, respectively, to €793 thousand and €1,498 thousand, respectively, for the three and nine months ended September 30, 2020, from €1,433 thousand and €1,853 thousand, respectively, for the three and nine months ended September 30, 2019, principally due to lower interest expenses in conjunction with the lease liabilities accounted for upon the adoption of IFRS 16 effective since January 1, 2019.

Real estate transfer tax

In June 2019, we sold our land and building, which had a carrying value of €22,778 thousand, to a subsidiary in preparation for a potential sale and leaseback transaction. Such intercompany transaction resulted in a real estate transfer tax expense of €1,200 thousand and was recognized in the three and nine months periods ended September 30, 2019.

Loss Before Taxes

As a result of the factors described above, our losses before taxes for the three and nine months ended September 30, 2020 were €5,537 thousand and €24,504 thousand, respectively, representing increases of €1,261 thousand and €8,828 thousand, respectively, from losses before taxes of €4,276 thousand and €15,676 thousand, respectively, for the three and nine months ended September 30, 2019.

Segment Adjusted EBITDA

We evaluate segment performance based on segment results and measure it with reference to Adjusted EBITDA, which we define as operating loss presented in the consolidated statements of comprehensive loss, adjusted for corporate expenses, depreciation and amortization as well as share-based payment expenses. Our Segment Adjusted EBITDA was as follows:


	For the Three Months		For the Nine Months
	Ended September 30,		Ended September 30,
	2019	2020	2019	2020

	(unaudited,
	€ in thousands)
Segment Adjusted EBITDA:
Pharmaceutical	3,400	871	9,561	5,278
Diagnostics	757	(1,210)	1,298	(2,736)
Covid-19	—	9,516	—	10,306
Total segment Adjusted EBITDA	4,157	9,177	10,859	12,848

Adjusted EBITDA from our pharmaceutical segment for the three and nine months ended September 30, 2020 were €871 thousand and €5,278 thousand, respectively, representing decreases of €2,529 thousand and €4,283 thousand, respectively, as compared to €3,400 thousand and €9,561 thousand, respectively, for the three and nine months ended September 30, 2019. The

decreases were primarily attributable to the decrease in revenues from the pharmaceutical segment, as well as the increase in cost of sales and the continuous expansion of our business development team.

Adjusted EBITDA from our COVID-19 segment for the three months and nine months ended September 30, 2020 was positive €9,516 thousand and €10,306 thousand, respectively.

Adjusted EBITDA from our diagnostics segment for the three months ended September 30, 2020, was negative €1,210 thousand, a decrease of €1,967 thousand as compared to €757 thousand for the three months ended September 30, 2019. The decrease is mainly due to decreases in revenues during the period. Adjusted EBITDA from our diagnostics segment for the nine months ended September 30, 2020, was negative €2,736 thousand, a decrease of €4,036 thousand as compared to €1,298 thousand for the nine months ended September 30, 2019, mainly attributable to increased credit loss allowances for trade receivables and contract assets recognized during the period.

Liquidity and Capital Resources

Our cash requirements are principally for working capital and capital expenditures, including expansions and improvements to our laboratory facilities, technology infrastructure and research and development activities. For the remaining period of 2020 and beyond, we anticipate that our capital expenditures will increase from prior periods as we continue to increase our research and development efforts. Our main source of liquidity has been our secured loans, municipal loans and government funding of research programs as well as the proceeds from our initial public offering.

In July 2020, we completed the Follow-on Equity Offering and received net offering proceeds, after deducting underwriting discounts and commissions, of €22 million.

Our financial condition and liquidity is and will continue to be influenced by a variety of factors, including our ability to continue to generate cash flows from our operations, our capital expenditure requirements, and the impact of the COVID-19 pandemic on financial markets and the global economy.

Our known material liquidity needs for periods beyond the next twelve months are described below under “Contractual Obligations and Commitment”. We believe that our existing cash and cash equivalents and proceeds from the Follow-on Equity Offering will enable us to fund our operating expenses and capital expenditure requirements for more than 12 months.

Comparative Cash Flows

The table below summarizes our consolidated statement of cash flows for the nine months ended September 30, 2020 and 2019:


	For the Nine Months
	Ended September 30,
	2019	2020

	(unaudited,
	€ in thousands)
Consolidated statement of cash flows:
Cash flow used in operating activities	(3,454)	(19,669)
Cash flow used in investing activities	13,521	(11,026)
Cash flow used in financing activities	(13,228)	18,348
Net decrease in cash and cash equivalents	(3,161)	(12,347)
Cash and cash equivalents at the beginning of the period	9,222	41,095
Cash and cash equivalents at the end of the period	6,061	28,748

Operating Activities

Our cash flow used in operating activities primarily relates to changes in the components of our working capital, including cash received from our pharmaceutical partners and diagnostics clients, and payments made to our suppliers.

For the nine months ended September 30, 2020, cash used in operating activities was €19,669 thousand, an increase of €16,215 thousand as compared to €3,454 thousand for the nine months ended September 30, 2019. This change was principally due to the increase in losses incurred for the period. In addition, to ensure we can continue to operate without being potentially affected by the COVID-19 pandemic limitations of our suppliers, we have purchased additional inventories for both COVID-19 tests and our core genetic testing, reflected in the increase in inventories by €5,482 thousand to €7,291 thousand as of September 30, 2020, from €1,809 thousand as of December 31, 2019.

Investing Activities

Our cash flow used in investing activities consists of investments in intangible assets, plant, property and equipment and right-of-use assets, as well as grants received for investments in property, plant and equipment.

The increase was mainly due to investments made in respect of COVID-19 testing during the period of €6,288 thousand, of which approximately €5,400 thousand are included in property, plant and equipment and right-of-use assets and €888 thousand related to intangible assets.

Financing Activities

Our cash flow received in financing activities is primarily driven by the cash received in our follow-on offering, which contributed €22 million in the three months ended September 30, 2020. Cash used in financing activities included also repayment of lease liabilities of €2,833 thousand for the nine months ended September 30, 2020, an increase of €1,326 thousand as compared to repayment of €1,507 thousand for the nine months ended September 30, 2019.

Off-Balance Sheet Arrangements

We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements, as defined in the rules and regulations of the SEC.

Contractual Obligations and Commitments

The table below presents the residual contractual terms of the financial liabilities, including estimated interest payments. The figures are undiscounted gross amounts, including estimated interest payments and interest on undrawn loan funds as of September 30, 2020, but without showing the impact of offsetting.


	Payments due by Period
		Total		Between 1	Between 3
	Carrying	contractual	Less than	and	and	More than
	amount	cashflow	1 year	3 years	5 years	5 years

	(unaudited,
	€ in thousands)
Secured bank loans	1,369	1,419	903	516	—	—
Bank overdraft	3,345	3,345	3,345	—	—	—
Other bank loans(1)	406	406	406	—	—	—
Lease liabilities(2)	21,347	25,168	4,072	6,125	3,772	11,199
Trade payables	12,052	12,052	12,052	—	—	—
Total	38,519	42,390	20,778	6,641	3,772	11,199

(1) On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was signed into law in the United States, which was a stimulus bill intended to bolster the U.S. economy, among other things, and provide assistance to qualifying businesses and individuals. The CARES Act included an infusion of funds into the healthcare system, and in May 2020, we received USD 475,000 as part of this initiative. This payment was recognized in short term current loans as of September 30, 2020. At this time, we are not certain of the availability, extent or impact of any future relief provided under the CARES Act.

(2) Lease liabilities include leases related to lease contracts for land and buildings, offices, as well as various items including motor vehicles and other equipment which are accounted for according to IFRS 16, and measured at the present value of lease payments over the lease term at the commencement date of the leases.

In addition, to the contractual obligations disclosed above, we also have various lease contracts in relation to the expansion of our Rostock headquarters and the Frankfurt laboratory that had not yet commenced as at September 30, 2020. The future lease payments and utilities for these non-cancellable lease contracts are €380 thousand within one year, €1,838 thousand within five years and €5,012 thousand thereafter as at September 30, 2020.

We also have various non-cancellable lease contracts of office equipment and storage spaces which had a lease term of less than 12 months or were related to leases of low-value assets, and therefore the short-term lease recognition exemption was applied to these contracts. The future lease payments for these non-cancellable lease contracts are €75 thousand within one year and €23 thousand within five years as at September 30, 2020.

As of September 30, 2020, we had concluded agreements with suppliers, for goods and services to be provided subsequent to September 30, 2020, with a total payment obligation of approximately €7,131 thousand.

For further information on our material loan agreements, please see “Item 5. Operating and Financial Review and Prospects—F. Tabular Disclosure of Contractual Obligations” in our Annual Report.

Critical Accounting Policies and Estimates

There have been no material changes to the critical accounting policies and estimates described in “Item 5. Operating and Financial Review and Prospects—H. Critical Accounting Policies and Estimates” in our Annual Report.

JOBS Act Exemption

As a company with less than US$1.07 billion in revenue during our last fiscal year, we qualify as an “emerging growth company” as defined in the JOBS Act. As an emerging growth company, we are not required to provide an auditor attestation report on our system of internal controls over financial reporting. This exemption will apply for a period of five years following the completion of our initial public offering (November 6, 2019) or until we no longer meet the requirements of being an “emerging growth company,” whichever is earlier. We would cease to be an emerging growth company if we have more than US$1.07 billion in annual revenue, have more than US$700 million in market value of our common shares held by non-affiliates or issue more than US$1.0 billion of non-convertible debt over a three-year period.

Cautionary Statement Regarding Forward Looking Statements

Forward-looking statements are based on our management’s beliefs and assumptions and on information currently available to our management. Such statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors, including, but not limited to, those identified under the heading “Risk Factors” in our Annual Report, Form 6-K containing our financial results for the six months ended June 30, 2020, filed with the SEC on September 23, 2020, and other current reports and documents filed with the SEC. These risks and uncertainties include factors relating to:

· our ability to effectively manage our future growth and to execute our business strategy;

· our ability to generate sufficient revenue from our relationships with our pharmaceutical partners and clients, and to otherwise maintain our current relationships, or enter into new relationships, with pharmaceutical partners and clients;

· the effects of the COVID-19 pandemic on our business, financial position and results of operations;

· economic, political or social conditions and the effects of these conditions on our pharmaceutical partners’ and diagnostics clients’ businesses and levels of business activity;

· our expectations for our products and solutions achieving commercial market acceptance, and our ability to keep pace with the rapidly evolving industry in which we operate;

· our assumptions regarding market size in the rare disease industry and our growth potential;

· our pharmaceutical partners’ and clients’ need for rare disease information products and solutions and any perceived advantage of our products over those of our competitors;

· our ability to manage our international expansion, including our exposure to new and complex business, regulatory, political, operational, financial, and economic risks, and numerous and conflicting legal and regulatory requirements;

· our continued reliance on our senior management team, in particular our CEO, and other qualified personnel and our ability to retain such personnel;

· our ability to obtain, maintain, protect and enforce sufficient patent and other intellectual property protection for any products or solutions we develop and for our technology;

· the ongoing protection of our trade secrets, know-how, and other confidential and proprietary information;

· our ability to remediate our material weakness on internal control over financial reporting;

· general economic, political, demographic and business conditions in North America, the Middle East, Europe and other regions in which we operate;

· changes in government and industry regulation and tax matters;

· other factors that may affect our financial condition, liquidity and results of operations; and

· other risk factors discussed under “Item 3. Key Information—D. Risk Factors” in our Annual Report.

You should refer to the section in our Annual Report titled “Risk Factors”, Form 6-K containing our financial results for the three months ended March 31, 2020, furnished to the SEC on June 15, 2020, Form 6-K containing our financial results for the three and nine months ended September 30, 2020, furnished to the SEC on December 16, 2020 and other current reports and documents furnished to or filed with the SEC, for a discussion of important factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. As a result of these factors, we cannot assure you that the forward-looking statements included herein or incorporated by reference herein will prove to be accurate. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may be material. In light of the significant uncertainties in these forward-looking statements, you should not regard these statements as a representation or warranty by us or any other person that we will achieve our objectives and plans in any specified time frame or at all. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. The Private Securities Litigation Reform Act of 1995 and Section 27A of the Securities Act do not protect any forward-looking statements that we make in connection with this offering.

Exhibit 99.4

Risk Factor on COVID-19

In response to the COVID-19 pandemic, we have swiftly ramped up our molecular testing for the diagnosis of COVID-19. The demand for such tests may shrink rapidly, and we may be unable to recoup the significant expenses incurred and investments made in testing capabilities.

In response to the COVID-19 pandemic, we took a series of measures aimed at minimizing the disruptions to our business and operations, including by adding COVID-19 molecular testing to our product mix. To support the rapid rollout of our COVID-19 testing offering, we have incurred significant expenses and made significant investments, including the acquisition of laboratory facilities, walk-in testing facilities, and mobile test centers, as well as related equipment and inventory. Our COVID-19 testing business has grown significantly since the second quarter of 2020 and, as a result, we started managing and reporting it as a separate reportable business segment in the third quarter of 2020 (during which quarter the COVID-19 testing segment generated revenues of €27.4 million).

While the COVID-19 pandemic has created an opportunity for our business and helped us offset the pandemic-related slowdown in our Diagnostics and Pharmaceutical businesses, and we presently expect our COVID-19 testing business to continue contributing significantly to our revenue for the remainder of 2020 and for 2021, the demand for our COVID-19 tests may not be sustainable and the recent increase in our revenues from COVID-19 testing may not be indicative of future revenues. Such demand, and the revenues of our COVID-19 testing segment, may shrink rapidly in the future, for instance:

●

as the pandemic abates or infection rates decline;

●

as vaccinations become more widely administered; or

●

if other tests become more accepted or produce results more quickly, more accurately or at lower cost;

in each case in particular in the regions where we offer our COVID-19 testing services. As a result, we may be unable to recoup the significant expenses we incurred in connection with our COVID-19 testing business. In addition, while we are depreciating all of the investments made in our COVID-19 testing business on an accelerated timetable, we may be required to write-down of some or all of our investments in, and working capital related to, our COVID-19 testing business. Any of the foregoing developments and events could have a material adverse effect on our business, results of operations and financial position.