Inotiv (NOTV) 10-Q15 May 232023 Q2 Quarterly reportFinancial data

Company Profile

Document And Entity Information

Document And Entity Information - shares	6 Months Ended
Document And Entity Information - shares	Mar. 31, 2023	May 01, 2023
Document And Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Mar. 31, 2023
Entity File Number	000-23357
Entity Registrant Name	INOTIV, INC.
Entity Incorporation, State or Country Code	IN
Entity Tax Identification Number	35-1345024
Entity Address, Address Line One	2701 KENT AVENUE
Entity Address, City or Town	WEST LAFAYETTE
Entity Address, State or Province	IN
Entity Address, Postal Zip Code	47906
City Area Code	765
Local Phone Number	463-4527
Title of 12(b) Security	Common Shares
Trading Symbol	NOTV
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		25,759,977
Entity Central Index Key	0000720154
Current Fiscal Year End Date	--09-30
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Amendment Flag	false

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
Current assets:
Cash and cash equivalents	$ 24,596	$ 18,515
Restricted cash	0	465
Trade receivables and contract assets, net of allowances for credit losses of $7,523 and $6,268, respectively	74,014	100,073
Inventories, net	64,286	71,441
Prepaid expenses and other current assets	40,479	42,483
Assets held for sale	7,270	0
Total current assets	210,645	232,977
Property and equipment, net	188,496	186,199
Operating lease right-of-use assets, net	42,014	32,489
Goodwill	94,286	157,825
Other intangible assets, net	326,261	345,886
Other assets	6,964	7,524
Total assets	868,666	962,900
Current liabilities:
Accounts payable	30,114	28,695
Accrued expenses and other liabilities	30,958	35,801
Revolving credit facility	0	15,000
Fees invoiced in advance	55,196	68,642
Current portion of long-term operating lease	10,061	7,982
Current portion of long-term debt	4,023	7,979
Liabilities held for sale	2,101	0
Total current liabilities	132,453	164,099
Long-term operating leases, net	32,730	24,854
Long-term debt, less current portion, net of debt issuance costs	370,040	330,677
Other long-term liabilities	6,023	6,477
Deferred tax liabilities, net	54,785	77,027
Total liabilities	596,031	603,134
Contingencies (Note 14)
Shareholders' equity and noncontrolling interest:
Common shares, no par value: Authorized 74,000,000 shares at March 31, 2023 and at September 30, 2022; 25,759,107 issued and outstanding at March 31, 2023 and 25,598,289 at September 30, 2022	6,491	6,362
Additional paid-in capital	711,591	707,787
Accumulated deficit	(444,838)	(348,277)
Accumulated other comprehensive income (loss)	702	(5,500)
Total equity attributable to common shareholders	273,946	360,372
Noncontrolling interest	(1,311)	(606)
Total shareholders' equity and noncontrolling interest	272,635	359,766
Total liabilities and shareholders' equity and noncontrolling interest	$ 868,666	$ 962,900

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
CONDENSED CONSOLIDATED BALANCE SHEETS
Allowance for credit losses	$ 7,523	$ 6,268
Common Stock, No Par Value	$ 0	$ 0
Common Stock, Shares Authorized	74,000,000	74,000,000
Common Stock, Shares, Issued	25,759,107	25,598,289
Common Stock, Shares, Outstanding	25,759,107	25,598,289

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Total revenue	$ 151,463	$ 140,313	$ 274,217	$ 224,524
Costs and expenses:
Selling	4,758	4,647	9,265	7,385
General and administrative	29,035	21,347	58,004	34,599
Amortization of intangible assets	8,453	6,414	17,234	9,810
Other operating expense	4,812	4,450	8,451	38,030
Goodwill impairment loss	0	0	66,367	0
Operating income (loss)	(2,125)	7,868	(92,703)	(25,773)
Interest expense	(10,515)	(7,547)	(20,965)	(12,375)
Other expense (income)	545	(139)	(1,333)	(57,866)
(Loss) income before income taxes	(12,095)	182	(115,001)	(96,014)
Income tax benefit (expense)	2,466	(6,846)	18,440	5,939
Consolidated net loss	(9,629)	(6,664)	(96,561)	(90,075)
Less: Net income (loss) attributable to noncontrolling interests	365	(577)	756	(941)
Net loss attributable to common shareholders	$ (9,994)	$ (6,087)	$ (97,317)	$ (89,134)
Loss per common share
Basic net loss per share (in dollars per share)	$ (0.39)	$ (0.24)	$ (3.79)	$ (3.84)
Diluted net loss per share (in dollar per share)	$ (0.39)	$ (0.24)	$ (3.79)	$ (3.84)
Weighted-average number of common shares outstanding:
Basic (in shares)	25,687	25,315	25,645	23,197
Diluted (in shares)	25,687	25,315	25,645	23,197
Service
Total revenue	$ 58,752	$ 49,584	$ 108,800	$ 87,760
Total cost of revenue (excluding amortization of intangible assets)	38,143	33,305	73,573	57,514
Product
Total revenue	92,711	90,729	165,417	136,764
Total cost of revenue (excluding amortization of intangible assets)	$ 68,387	$ 62,282	$ 134,026	$ 102,959

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Consolidated net (loss) income	$ (9,629)	$ (6,664)	$ (96,561)	$ (90,075)
Other comprehensive (loss), net of tax
Foreign currency translation	962	(1,114)
Defined benefit plans:
Foreign currency translation	962	(1,114)
Other comprehensive income (loss), net of tax	908	(774)	6,202	(637)
Consolidated comprehensive loss	(8,721)	(7,438)	(90,359)	(90,712)
Less: Comprehensive income (loss) attributable to non-controlling interests	365	(577)	756	(941)
Comprehensive loss attributable to common stockholders	(9,086)	(6,861)	(91,115)	(89,771)
Defined benefit plans
Other comprehensive (loss), net of tax
Foreign currency translation	26	0	267	0
Defined benefit plans:
Pension cost amortization	(54)	340	(108)	230
Foreign currency translation	26	0	267	0
Operating related
Other comprehensive (loss), net of tax
Foreign currency translation	936	(1,114)	6,043	(867)
Defined benefit plans:
Foreign currency translation	$ 936	$ (1,114)	$ 6,043	$ (867)

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY AND NONCONTROLLING INTEREST - USD ($)	Common Shares	Additional paid-in capital	Accumulated deficit	Accumulated Other Comprehensive (Loss) Income	Non-Controlling Interests	Total
Balance at Sep. 30, 2021	$ 3,945,000	$ 112,198,000	$ (11,015,000)	$ 0	$ 0	$ 105,128,000
Balance (in shares) at Sep. 30, 2021	15,931,485
Consolidated net income (loss)	$ 0	0	(83,411,000)	0	364,000	(83,047,000)
Stock issued in acquisitions	$ 2,094,000	459,289,000	0	0	0	461,383,000
Stock issued in acquisitions (In shares)	8,374,138
Noncontrolling interest related to Envigo acquisition	$ 0	0	0	0	(983,000)	(983,000)
Issuance of stock under employee stock plans	$ 11,000	38,000	0	0	0	49,000
Issuance of stock under employee stock plans (in shares)	42,971
Stock based compensation	$ 0	19,160,000	0	0	0	19,160,000
Stock based compensation (in shares)	0
Pension cost amortization	$ 0	0	0	(110,000)	0	(110,000)
Foreign currency translation	0	0	0	247,000	0	247,000
Reclassification of convertible note embedded derivative to equity (Note 7)	0	88,576,000	0	0	0	88,576,000
Balance at Dec. 31, 2021	$ 6,050,000	679,261,000	(94,426,000)	137,000	(619,000)	590,403,000
Balance (in shares) at Dec. 31, 2021	24,348,594
Balance at Sep. 30, 2021	$ 3,945,000	112,198,000	(11,015,000)	0	0	105,128,000
Balance (in shares) at Sep. 30, 2021	15,931,485
Consolidated net income (loss)						$ (89,134,000)
Stock issued in acquisitions (In shares)						9,480,595
Balance at Mar. 31, 2022	$ 6,336,000	713,034,000	(101,090,000)	(628,000)	(242,000)	$ 617,410,000
Balance (in shares) at Mar. 31, 2022	25,495,701
Balance at Dec. 31, 2021	$ 6,050,000	679,261,000	(94,426,000)	137,000	(619,000)	590,403,000
Balance (in shares) at Dec. 31, 2021	24,348,594
Consolidated net income (loss)	$ 0	0	(6,664,000)	0	577,000	(6,087,000)
Stock issued in acquisitions	$ 276,000	32,599,000	0	0	0	$ 32,875,000
Stock issued in acquisitions (In shares)	1,106,457					1,106,457
Noncontrolling interest related to Envigo acquisition	$ 0	0	0	0	(191,000)	$ (191,000)
Issuance of stock under employee stock plans	$ 10,000	36,000	0	0	0	46,000
Issuance of stock under employee stock plans (in shares)	40,650
Stock based compensation	$ 0	1,138,000	0	0	0	1,138,000
Pension cost amortization	0	0	0	340,000	0	340,000
Foreign currency translation	0	0	0	(1,105,000)	(9,000)	(1,114,000)
Balance at Mar. 31, 2022	$ 6,336,000	713,034,000	(101,090,000)	(628,000)	(242,000)	617,410,000
Balance (in shares) at Mar. 31, 2022	25,495,701
Balance at Sep. 30, 2022	$ 6,362,000	707,787,000	(348,277,000)	(5,500,000)	(606,000)	359,766,000
Balance (in shares) at Sep. 30, 2022	25,598,289
Consolidated net income (loss)	$ 0	0	(86,932,000)		(391,000)	(87,323,000)
Issuance of stock under employee stock plans	$ 1,000	23,000	0			24,000
Issuance of stock under employee stock plans (in shares)	8,347
Stock based compensation	$ 0	2,046,000	0			2,046,000
Pension cost amortization	0	0	0	(54,000)		(54,000)
Foreign currency translation	0	0	0	5,348,000		5,348,000
Balance at Dec. 31, 2022	$ 6,363,000	709,856,000	(435,209,000)	(206,000)	(997,000)	279,807,000
Balance (in shares) at Dec. 31, 2022	25,606,636
Balance at Sep. 30, 2022	$ 6,362,000	707,787,000	(348,277,000)	(5,500,000)	(606,000)	359,766,000
Balance (in shares) at Sep. 30, 2022	25,598,289
Consolidated net income (loss)						$ (97,317,000)
Stock issued in acquisitions (In shares)						0
Balance at Mar. 31, 2023	$ 6,491,000	711,591,000	(444,838,000)	702,000	(1,311,000)	$ 272,635,000
Balance (in shares) at Mar. 31, 2023	25,759,107
Balance at Dec. 31, 2022	$ 6,363,000	709,856,000	(435,209,000)	(206,000)	(997,000)	279,807,000
Balance (in shares) at Dec. 31, 2022	25,606,636
Consolidated net income (loss)	$ 0	0	(9,629,000)		(365,000)	$ (9,994,000)
Stock issued in acquisitions (In shares)						0
Issuance of stock under employee stock plans	$ 128,000	(46,000)	0			$ 82,000
Issuance of stock under employee stock plans (in shares)	152,471
Stock based compensation	$ 0	1,781,000	0			1,781,000
Pension cost amortization	0	0	0	(54,000)		(54,000)
Foreign currency translation	0	0	0	962,000		962,000
Other	0	0	0		51,000	51,000
Balance at Mar. 31, 2023	$ 6,491,000	$ 711,591,000	$ (444,838,000)	$ 702,000	$ (1,311,000)	$ 272,635,000
Balance (in shares) at Mar. 31, 2023	25,759,107

CONDENSED CONSOLIDATED STATEM_4

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Operating activities:
Consolidated net loss	$ (96,561)	$ (90,075)
Adjustments to reconcile net loss to net cash used in operating activities, net of acquisitions:
Depreciation and amortization	26,253	15,866
Employee stock compensation expense	3,827	20,300
Changes in deferred taxes	(21,303)	(1,907)
Provision for doubtful accounts	1,333	381
Amortization of debt issuance costs and original issue discount	1,512	1,203
Noncash interest and accretion expense	2,870	2,512
Loss on fair value remeasurement of embedded derivative	0	56,714
Other non-cash operating activities	8	603
Goodwill impairment loss	66,367	0
Loss on debt extinguishment	0	878
Non-cash amortization of inventory fair value step-up	427	6,277
Non-cash restructuring costs	678	0
Changes in operating assets and liabilities:
Trade receivables and contract assets	22,836	(8,926)
Inventories	7,125	(14,688)
Prepaid expenses and other current assets	1,862	(10,149)
Operating lease right-of-use assets and liabilities, net	429	1,457
Accounts payable	5,018	5,222
Accrued expenses and other liabilities	(3,474)	(11,510)
Fees invoiced in advance	(13,720)	28,402
Other asset and liabilities, net	(61)	1,467
Net cash provided by operating activities	5,426	4,027
Investing activities:
Capital expenditures	(16,840)	(15,202)
Proceeds from sale of equipment	276	283
Cash paid in acquisitions	0	(288,702)
Net cash used in investing activities	(16,564)	(303,621)
Financing activities:
Payments of long-term debt	0	(37,746)
Payments of debt issuance costs	(54)	(9,887)
Payments on promissory notes	(1,454)	(763)
Payments on revolving credit facility	(21,000)	(10,000)
Payments on senior term notes and delayed draw term loans	(1,375)	(601)
Borrowings on construction loans	0	1,184
Borrowings on revolving loan facility	6,000	10,000
Borrowings on delayed draw term loan	35,000	35,000
Proceeds from exercise of stock options	107	93
Proceeds from issuance of senior term notes	0	205,000
Payments on capex lines of credit	0	(1,749)
Net cash provided by financing activities	17,224	190,531
Effect of exchange rate changes on cash and cash equivalents	1,052	(392)
Net increase (decrease) in cash and cash equivalents	7,138	(109,455)
Less: cash, cash equivalents, and restricted cash held for sale	1,522	0
Cash, cash equivalents, and restricted cash at beginning of period	18,980	156,924
Cash, cash equivalents, and restricted cash at end of period, net of cash, cash equivalents and restricted cash held for sale	24,596	47,469
Noncash financing activity:
Seller financed acquisition	0	6,325
Paid in kind debt issuance costs	1,363	0
Supplemental disclosure of cash flow information:
Cash paid for interest	16,374	5,989
Income taxes paid, net	$ 3,952	$ 614

DESCRIPTION OF THE BUSINESS AND

DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION	6 Months Ended
DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION	Mar. 31, 2023
DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION
DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION	1. DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION Inotiv, Inc. and its subsidiaries (“we,” “our,” “us,” the “Company,” and “Inotiv”) comprise a leading contract research organization (“CRO”) dedicated to providing nonclinical and analytical drug discovery and development services to the pharmaceutical and medical device industries and selling a range of research-quality animals and diets to the same industries as well as academia and government clients. Our products and services focus on bringing new drugs and medical devices through the discovery and preclinical phases of development, all while increasing efficiency, improving data, and reducing the cost of discovering and taking new drugs and medical devices to market. Inotiv is committed to supporting discovery and development objectives as well as helping researchers realize the full potential of their critical research and development projects, all while working together to build a healthier and safer world. We are dedicated to practicing high standards of laboratory animal care and welfare. As a result of our strategic acquisition of Envigo RMS Holding Corp. (“Envigo”) in November 2021, which added a complementary research model platform, our full spectrum solutions now span two segments: Discovery and Safety Assessment (“DSA”) and Research Models and Services (“RMS”). Through our DSA segment, we support the discovery, nonclinical development and clinical development needs of researchers and clinicians for primarily small molecule drug candidates, as well as biotherapeutics and biomedical devices. Our scientists have skills in analytical instrumentation development, chemistry, computer software development, histology, pathology, physiology, surgery, analytical chemistry, drug metabolism, pharmacokinetics, and toxicology to make the services and products we provide increasingly valuable to our current and potential clients. Our principal clients are companies whose scientists are engaged in analytical chemistry, drug safety evaluation, clinical trials, drug metabolism studies, pharmacokinetics and basic research, from small start-up biotechnology companies to some of the largest global pharmaceutical companies. Through our RMS segment, we offer access to a wide range of small and large research models for basic research and drug discovery and development, as well as specialized models for specific diseases and therapeutic areas. We combine deep animal husbandry expertise and expanded access to scientists across the discovery and preclinical continuum, which reduces nonclinical lead times and provides enhanced project delivery. In conjunction with our CRO business, we have the ability to run selected nonclinical studies directly on-site at closely located research model facilities and provide access to innovative genetically engineered models and services solutions. Our principal clients include biopharmaceutical companies, CROs, and academic and government organizations. Temporarily Suspended or Limited Operations On November 16, 2022, the Company became aware that the U.S. Attorney’s Office for the Southern District of Florida (“USAO-SDFL”) had criminally charged employees of the principal supplier of non-human primates (“NHPs”) to the Company, along with two Cambodian government officials, with conspiring to illegally import NHPs into the U.S. from December 2017 through January 2022 and in connection with seven specific imports between July 2018 and December 2021 (the “November 16, 2022 event”). Also as previously disclosed, two of the Company’s subsidiaries, Orient BioResource Center, Inc. (“OBRC”) and Envigo Global Services, Inc. (“EGSI”), companies acquired by the Company on January 27, 2022 and November 5, 2021, respectively, had received grand jury subpoenas from USAO-SDFL requiring the production of documents and information related to their importation of NHPs into the U.S. The Company has been fully cooperating, and will continue to cooperate, with USAO-SDFL. The Company has not been directed to refrain from selling the Cambodian NHPs in its possession in the U.S. However, due to the allegations contained in the indictment involving the supplier and the Cambodian government officials, the Company believed that it was prudent, at the time and through January 13, 2023, to refrain from selling or delivering any of its Cambodian NHPs held in the U.S. until the Company’s staff and external experts evaluated what additionally could be done to satisfy itself that the NHPs in inventory from Cambodia can be reasonably determined to be purpose-bred. Historically, the Company has relied on the Convention on International Trade in Endangered Species of Wild Fauna and Flora (“CITES”) documentation and related processes and procedures, including release of each import by U.S. Fish and Wildlife Service. The Company has continued to sell NHPs from other suppliers. Subsequent to January 13, 2023, and through the date of this report, and after an internal analysis and review, the Company has shipped a select number of its Cambodian NHP inventory; however, the Company is not currently shipping Cambodian NHPs at the same volumes that it was prior to the November 16, 2022 event. The Company expects to establish new procedures before it will resume Cambodian NHP imports. The Company expects that future imports of NHPs from Cambodia will be dependent on working with third parties to establish additional procedures aiming at providing additional assurances that future NHP imports from Cambodia are purpose-bred. Of the Company’s total revenue of $547,656 in the fiscal year ended September 30, 2022, approximately $140,000 was from NHPs that it had imported from Cambodia. Refer to the Liquidity section below and Note 5 – Goodwill and Intangible Assets for further discussion of impacts to the six months ended March 31, 2023, and expected future impacts. Liquidity As of March 31, 2023, the Company had cash and cash equivalents of approximately $24,596. The November 16, 2022 event and subsequent decision to refrain from selling or delivering Cambodian NHPs held in the U.S., triggered a material adverse event clause in our Credit Agreement (as defined in Note 6 – Debt) resulting in, among other things, a limitation of the Company’s ability to draw on its revolving credit facility. The loss of access to the Company’s revolving credit facility and reduced liquidity resulting from the decision to refrain from selling Cambodian NHPs held in the U.S. resulted in reduced forecasted liquidity. As a result of these events, the Company took steps to improve its liquidity, which included negotiating an amendment to its Credit Agreement, which was executed on January 9, 2023, to reinstate its ability to borrow under its revolving credit facility. Without the amendment, the Company was at risk of not having the revolving credit facility available. During the six months ended March 31, 2023, the Company announced the completion of the closure of the Cumberland, Virginia (“Cumberland”) facility. Further, the Dublin, Virginia (“Dublin”) facility transition was completed in November 2022 and the exits of the Boyertown, Pennsylvania (“Boyertown”) and Haslett, Michigan (“Haslett”) facilities were completed in March 2023. In addition to the completed closures, the Company’s current site optimization strategy includes the following sites which have been identified for relocation of operations: Gannat, France (“Gannat”); Blackthorn, U.K. (“Blackthorn”) and St. Louis, Missouri (“RMS St. Louis”). The Company completed its consultation with employee representatives at the Gannat and Blackthorn facilities and the closures of both facilities have been approved. The consolidation plans for the Gannat and Blackthorn facilities are expected to be complete by the end of June 2023 and the end of June 2024, respectively. Further, the Company plans to close the RMS St. Louis facility and relocate its operations by the end of June 2023. Refer to Note 10 – Restructuring and Assets Held for Sale for further information regarding the site optimization plan. Basis of Presentation The Company has prepared the accompanying unaudited interim condensed consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles (“GAAP”), and therefore should be read in conjunction with the Company’s audited consolidated financial statements, and the notes thereto, included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2022. In the opinion of management, the condensed consolidated financial statements for the three and six months ended March 31, 2023 and 2022 include all adjustments which are necessary for a fair presentation of the results of the interim periods and of the Company’s financial position at March 31, 2023. The results of operations for the three and six months ended March 31, 2023 are not necessarily indicative of the results for the fiscal year ending September 30, 2023. Certain prior year amounts have been reclassified within the statement of cash flows for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires the Company to make estimates and judgements that may affect the reported amounts of assets, liabilities, revenues, and expenses, and related disclosures of contingent assets and liabilities. These include, but are not limited to, management estimates in the calculation and timing of revenue recognition, pension liabilities, deferred tax assets and liabilities and the related valuation allowance. Although estimates are based upon management’s best estimate using historical experience, current events, and actions, actual results could differ from those estimates. Changes in estimates are reflected in reported results in the period in which they become known. Consolidation The accompanying condensed consolidated financial statements are unaudited and have been prepared by the Company, including all subsidiaries and a variable interest entity (“VIE”) it consolidates in accordance with GAAP. The Company consolidates a VIE as a result of the Envigo acquisition. The VIE does not materially impact our net assets or net loss. The Company accounts for noncontrolling interests in accordance with Accounting Standards Codification (“ASC”) 810, “Consolidation” (“ASC 810”). ASC 810 requires companies with noncontrolling interests to disclose such interests as a portion of equity but separate from the parent’s equity. The noncontrolling interests’ portion of net income (loss) is presented on the condensed consolidated statements of operations. Summary of Significant Accounting Policies The Company’s significant accounting policies are described in Note 2, “Summary of Significant Accounting Policies” in the Company’s Annual Report on Form 10-K for the twelve months ended September 30, 2022. Concentration of Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of trade receivables from customers in the biopharmaceutical, contract research, academic, and governmental sectors. The Company believes its exposure to credit risk is minimal, as the majority of the customers are predominantly well established and viable. Additionally, the Company maintains allowances for potential credit losses. The Company’s exposure to credit loss in the event that payment is not received for revenue recognized equals the outstanding trade receivables and contract assets less fees invoiced in advance. During the three and six months ended March 31, 2023, one customer accounted for 25.0% and 23.6% of sales, respectively. During the three and six months ended March 31, 2022, one customer accounted for 31.4% and 27.4% of sales, respectively. During the three and six months ended March 31, 2023 and 2022, no vendors accounted for more than 10% of cost of revenues.

REVENUE FROM CONTRACTS WITH CUS

REVENUE FROM CONTRACTS WITH CUSTOMERS	6 Months Ended
REVENUE FROM CONTRACTS WITH CUSTOMERS	Mar. 31, 2023
REVENUE FROM CONTRACTS WITH CUSTOMERS
REVENUE FROM CONTRACTS WITH CUSTOMERS	2. DSA The DSA segment generates service revenue through drug discovery and development services. The DSA segment generates product revenue through internally-manufactured scientific instruments for life sciences research and the related software for use by pharmaceutical companies, universities, government research centers and medical research institutions under the Company’s BASi product line. RMS The RMS segment generates products revenue through the commercial production and sale of research models, diets and bedding and bioproducts. The RMS segment generates service revenue through Genetically Engineered Models and Services (GEMS), client-owned animal colony care, and health monitoring and diagnostics services related to research models. Contract Assets and Liabilities from Contracts with Customers The timing of revenue recognition, billings and cash collections results in billed receivables (trade receivables), contract assets (unbilled revenue), and contract liabilities (customer deposits and deferred revenue) on the condensed consolidated balance sheets. The following table provides information about contract assets (trade receivables and unbilled revenue, excluding allowances for credit losses), and fees invoiced in advance (customer deposits and deferred revenue): Balance at Balance at March 31, September 30, 2023 2022 Contract assets: Trade receivables $ 65,127 $ 88,867 Contract assets: Unbilled revenue 16,410 17,474 Contract liabilities: Customer deposits 36,761 39,222 Contract liabilities: Deferred revenue 18,435 29,420 When the Company does not have the unconditional right to advanced billings, both advanced client payments and unpaid advanced client billings are excluded from deferred revenue, with the advanced billings also being excluded from client receivables. The Company excluded approximately $15,419 and $2,647 of unpaid advanced client billings from both client receivables and deferred revenue in the accompanying unaudited condensed consolidated balance sheets as of March 31, 2023 and September 30, 2022, respectively. Changes in the contract asset and the contract liability balances during the six months ended March 31, 2023 include the following: ● Changes in the time frame for a right for consideration to become unconditional – approximately 85% of unbilled revenue as of September 30, 2022, was billed during the six months ended March 31, 2023 ● Changes in the time frame for a performance obligation to be satisfied – approximately 55% of deferred revenue as of September 30, 2022, was recognized as revenue during the six months ended March 31, 2023.

SEGMENT AND GEOGRAPHIC INFORMAT

SEGMENT AND GEOGRAPHIC INFORMATION	6 Months Ended
SEGMENT AND GEOGRAPHIC INFORMATION	Mar. 31, 2023
SEGMENT AND GEOGRAPHIC INFORMATION
SEGMENT AND GEOGRAPHIC INFORMATION	3. Segment Information During the three and six months ended March 31, 2023, the RMS segment reported intersegment revenue of $3,262 and $4,387 Three Months Ended Six Months Ended March 31, March 31, 2023 2022 2023 2022 Revenue DSA: Service revenue $ 46,145 $ 38,062 $ 86,116 $ 69,937 Product revenue 878 992 2,000 1,942 RMS: Service revenue 12,607 11,522 22,684 17,823 Product revenue 91,833 89,737 163,417 134,822 $ 151,463 $ 140,313 $ 274,217 $ 224,524 Operating Income (Loss) DSA $ 1,924 $ 3,752 $ 4,296 $ 9,794 RMS 12,725 22,562 (58,547) 22,642 Unallocated Corporate (16,774) (18,446) (38,452) (58,209) $ (2,125) $ 7,868 $ (92,703) $ (25,773) Interest expense (10,515) (7,547) (20,965) (12,375) Other income (expense) 545 (139) (1,333) (57,866) (Loss) income before income taxes $ (12,095) $ 182 $ (115,001) $ (96,014) Three Months Ended Six Months Ended March 31, March 31, 2023 2022 2023 2022 Depreciation and amortization: DSA $ 3,611 $ 3,414 $ 7,591 $ 5,958 RMS 9,379 6,417 18,662 9,908 $ 12,990 $ 9,831 $ 26,253 $ 15,866 Capital expenditures: DSA $ 3,970 3,431 $ 7,264 $ 6,417 RMS 4,501 6,116 9,576 8,785 $ 8,471 $ 9,547 $ 16,840 $ 15,202 Geographic Information The following represents revenue originating in entities physically located in the identified geographic area: Three Months Ended Six Months Ended March 31, March 31, 2023 2022 2023 2022 United States $ 129,980 $ 117,890 $ 228,989 $ 190,335 Netherlands 11,522 12,119 26,744 18,655 Other 9,961 10,304 18,484 15,534 $ 151,463 $ 140,313 $ 274,217 $ 224,524 Long-lived assets shown below include property and equipment, net. The following represents long-lived assets where they are physically located: March 31, September 30, 2023 2022 United States $ 173,540 $ 173,417 Netherlands 6,436 5,824 Other 8,520 6,958 $ 188,496 $ 186,199

BUSINESS COMBINATIONS

BUSINESS COMBINATIONS	6 Months Ended
BUSINESS COMBINATIONS	Mar. 31, 2023
BUSINESS COMBINATIONS
BUSINESS COMBINATIONS	4. BUSINESS COMBINATIONS The Company accounts for acquisitions in accordance with ASC 805, Business Combinations. The guidance requires consideration given, including contingent consideration, assets acquired, liabilities assumed and non-controlling interests to be valued at their fair market values at the acquisition date. The guidance further provides that: (1) in-process research and development will be recorded at fair value as an indefinite-lived intangible asset; (2) acquisition costs will generally be expensed as incurred; (3) restructuring costs associated with a business combination will generally be expensed subsequent to the acquisition date; and (4) changes in deferred tax asset valuation allowances and income tax uncertainties after the acquisition date generally will affect income tax expense (benefit). ASC 805 requires that any excess of the purchase price over the fair value of assets acquired, including identifiable intangibles and liabilities assumed, be recognized as goodwill. Plato BioPharma Acquisition On October 4, 2021, the Company completed the acquisition of Plato BioPharma, Inc. (“Plato”) to expand its market reach in early-stage drug discovery. Consideration for the Plato acquisition consisted of (i) $10,530 in cash, including working capital and subject to customary purchase price adjustments, (ii) 57,587 of the Company’s common shares valued at $1,776 using the closing price of the Company’s common shares on October 4, 2021 and (iii) seller notes to the former shareholder of Plato in an aggregate principal amount of $3,000. This business is reported as part of our DSA reportable segment. The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date: October 4, 2021 Assets acquired and liabilities assumed: Cash 1,027 Trade receivables and contract assets 853 Prepaid expenses and other assets 133 Property and equipment 1,127 Operating lease right-of-use assets, net 2,272 Goodwill 9,279 Intangible assets 4,800 Accounts payable (113) Accrued expenses and other liabilities (343) Operating lease liabilities (2,272) Deferred tax liabilities (1,457) $ 15,306 Property and equipment is mostly composed of lab equipment, furniture and fixtures, and computer equipment. The fair value of property and equipment was determined using a combination of cost and market-based methodologies. Intangible assets primarily relate to customer relationships. The acquired definite-lived intangible assets are being amortized over a weighted-average estimated useful life of approximately eight years for customer relationships on a straight-line basis. The estimated fair value of the customer relationships was determined using the "income approach," which is a valuation technique that provides the fair value of an asset based on market participant expectations of the cash flows an asset would generate over its remaining useful life. Some of the significant assumptions inherent in the development of these asset valuations include the estimated net cash flows for each year for each asset or product (including revenues and EBITDA), the appropriate discount rate necessary to measure the risk inherent in each future cash flow stream, the life cycle of each asset, the potential regulatory and commercial success risk, and competitive trends impacting the asset and each cash flow stream, as well as other factors. Goodwill, which is derived from the enhanced scientific expertise, expanded client base and our ability to provide broader service solutions through a comprehensive portfolio, is recorded based on the amount by which the purchase price exceeds the fair value of the net assets acquired and is not deductible for tax purposes. Goodwill from this transaction is allocated to the Company’s DSA reportable segment. In accordance with ASC 805-740, the Company established a deferred tax liability with an offset to goodwill in connection with the accounting for the opening balance sheet of the Plato acquisition as a result of book-to-tax differences primarily related to the intangible assets. Envigo RMS Holding Corp Acquisition On November 5, 2021, the Company completed the acquisition of Envigo by merger of a wholly owned subsidiary of the Company with and into Envigo to expand its market reach in early-stage drug discovery. The aggregate consideration paid to the holders of outstanding capital stock in Envigo in the merger consisted of cash of $217,808, including adjustments for net working capital, and 8,245,918 of the Company’s common shares valued at $439,590 using the opening price of the Company’s common shares on November 5, 2021. In addition, the Company assumed certain outstanding Envigo stock options, including both vested and unvested options, that were converted to the right to purchase 790,620 Company common shares at an exercise price of $9.93 per share. The stock options were valued at $44.80 per option utilizing a Black-Scholes option valuation model with the inputs below. The total value of options issued was $35,418, of which $18,242 was excluded from the purchase price as those options were determined to be post-combination expense. The previously vested stock options are reflected as purchase consideration of approximately $17,176. This business is reported as part of the Company’s RMS reportable segment. Stock price $ 53.31 Strike price $ 9.93 Volatility 75.93 % Expected term 3.05 Risk-free rate 0.62 % The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date: November 5, 2021 Assets acquired and liabilities assumed: Cash 2,488 Restricted cash 435 Trade receivables and contract assets 43,566 Inventories 40,000 Prepaid expenses and other current assets 17,373 Property and equipment 106,338 Operating lease right-of-use assets, net 13,229 Goodwill 282,768 Intangible assets - customer relationships 251,000 Intangible assets - intellectual property 49,000 Other assets 7,676 Accounts payable (25,832) Accrued expenses and other liabilities (11,665) Fees invoiced in advance (7,047) Current portion on long-term operating lease (4,371) Long-term operating leases, net (8,634) Other liabilities (5,339) Deferred tax liabilities (77,291) Noncontrolling interest 880 $ 674,574 Inventory is comprised of small and large animal research models, including NHPs, and Teklad diet and bedding. The fair value was determined using a comparative sales methodology, in which the intent is to ensure that the acquirer only recognizes profits associated to value added subsequent to the acquisition date. Property and equipment is mostly composed of land, buildings and equipment (including lab equipment, furniture and fixtures, caging and computer equipment). The fair value of property and equipment was determined using a combination of cost and market-based methodologies. Intangible assets primarily relate to customer relationships and technology associated with the ability to produce and care for the research models. The acquired customer relationship intangible assets are being amortized over a weighted-average estimated useful life of approximately 12.5 years on a straight-line basis and the acquired intellectual property associated with the ability to produce and care for the research models is being amortized over a weighted-average estimated useful life of approximately 8.8 years. The estimated fair values of identifiable intangible assets were determined using the "income approach," which is a valuation technique that provides an estimate of the fair value of an asset based on market participant expectations of the cash flows an asset would generate over its remaining useful life. Some of the significant assumptions inherent in the development of these asset valuations include the estimated net cash flows for each year for each asset or product (including revenues, gross margin, EBITDA, customer survival rate and royalty rates), the appropriate discount rate necessary to measure the risk inherent in each future cash flow stream, the life cycle of each asset, the potential regulatory and commercial success risk, and competitive trends impacting the asset and each cash flow stream, as well as other factors. In accordance with ASC 805-740, the Company established a deferred tax liability with an offset to goodwill in connection with the accounting for the opening balance sheet of the Envigo acquisition as a result of book-to-tax differences primarily related to the intangible assets, step up on the fair value of inventory and property and equipment. Within the deferred tax liability, $2,222 of acquired foreign net operating losses are offset by an uncertain tax benefit of $1,861. Goodwill, which is derived from the expanded client base, the ability to provide products and services for the entirety of discovery and nonclinical development within one organization, and to ensure supply for internal use, is recorded based on the amount by which the purchase price exceeds the fair value of the net assets acquired and $50,428 is deductible for tax purposes. Goodwill from this transaction is allocated to the Company’s RMS reportable segment. Robinson Services, Inc. Acquisition On December 29, 2021, the Company completed the acquisition of the rabbit breeding and supply business of Robinson Services, Inc. (“RSI”). The acquisition was another step in Inotiv’s strategic plan for building its RMS business. The aggregate consideration paid in the transaction consisted of cash consideration of $3,250 and 70,633 of the Company’s common shares valued at $2,898 using the closing price of the Company’s common shares on December 29, 2021. This business is reported as part of the Company’s RMS reportable segment. The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date: December 29, 2021 Assets acquired and liabilities assumed: Customer relationship 4,700 Non-compete agreement 300 Supply agreement 200 Goodwill 948 $ 6,148 Intangible assets primarily relate to customer relationships. The acquired definite-lived intangible assets are being amortized over a weighted-average estimated useful life of approximately 7.5 years on a straight-line basis. The estimated fair values of identifiable intangible assets were determined using the "income approach," which is a valuation technique that provides an estimate of the fair value of an asset based on market participant expectations of the cash flows an asset would generate over its remaining useful life. Some of the significant assumptions inherent in the development of these asset valuations include the estimated net cash flows for each year for each asset or product (including revenues and EBITDA), the appropriate discount rate necessary to measure the risk inherent in each future cash flow stream, the life cycle of each asset, the potential regulatory and commercial success risk, and competitive trends impacting the asset and each cash flow stream, as well as other factors. Goodwill, which is derived from the expanded client base and our ability to provide broader service solutions through a comprehensive portfolio, is recorded based on the amount by which the purchase price exceeds the fair value of the net assets acquired and is deductible for tax purposes. Goodwill from this transaction is allocated to the Company’s RMS reportable segment. Integrated Laboratory Systems, LLC Acquisition On January 10, 2022, the Company completed the acquisition of Integrated Laboratory Systems, LLC (“ILS”). ILS is a provider of services specializing in nonclinical and analytical drug discovery and development services. Consideration for the ILS acquisition consisted of (i) $38,993 in cash, including adjustments for net working capital, and inclusive of $3,800 being held in escrow for purposes of securing any amounts payable by the selling parties on account of indemnification obligations, purchase price adjustments, and other amounts payable under the merger agreement, (ii) 429,118 of the Company’s common shares valued at $14,466 using the opening price of the Company’s common shares on January 10, 2022 and (iii) the effective settlement of a preexisting relationship of $(15). This business is reported as part of our DSA reportable segment. The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date: January 10, 2022 Assets acquired and liabilities assumed: Cash 797 Trade receivables, contract assets and other current assets 4,730 Property and equipment 4,436 Operating lease right-of-use assets, net 4,994 Goodwill 25,283 Intangible assets 22,300 Accounts payable (1,165) Accrued expenses and other liabilities (905) Fees invoiced in advance (2,472) Operating lease liabilities (4,554) $ 53,444 Property and equipment is mostly composed of equipment (including lab equipment, furniture and fixtures, and computer equipment) and leasehold improvements. The fair value of property and equipment was determined using a combination of cost and market-based methodologies. Intangible assets primarily relate to customer relationships. The acquired definite-lived intangible assets are being amortized over a weighted-average estimated useful life of approximately nine years on a straight-line basis. The estimated fair values of identifiable intangible assets were determined using the "income approach," which is a valuation technique that provides an estimate of the fair value of an asset based on market participant expectations of the cash flows an asset would generate over its remaining useful life. Some of the significant assumptions inherent in the development of these asset valuations include the estimated net cash flows for each year for each asset or product (including revenues, EBITDA, and customer survival rate), the appropriate discount rate necessary to measure the risk inherent in each future cash flow stream, the life cycle of each asset, the potential regulatory and commercial success risk, and competitive trends impacting the asset and each cash flow stream, as well as other factors. Goodwill, which is derived from the enhanced scientific expertise, expanded client base and our ability to provide broader service solutions through a comprehensive portfolio, is recorded based on the amount by which the purchase price exceeds the fair value of the net assets acquired and is deductible for tax purposes. Goodwill from this transaction is allocated to the Company’s DSA reportable segment. Orient BioResource Center, Inc. Acquisition On January 27, 2022, the Company completed the acquisition of OBRC from Orient Bio, Inc., a preclinical contract research organization and animal model supplier based in Seongnam, South Korea (“Seller”). OBRC is a primate quarantine and holding facility. Consideration for the OBRC acquisition consisted of (i) $26,522 in cash, including certain adjustments, (ii) 677,339 of the Company’s common shares valued at $18,410 using the closing price of the Company’s common shares on January 27, 2022, (iii) the effective settlement of a preexisting relationship of $1,017 and (iv) a payable owed by OBRC to the Seller in the amount of $3,325. The preexisting relationship represents the return of fees invoiced in advance and paid to OBRC by the Company prior to the acquisition offset by the payment of trade receivables by the Company to OBRC. As these were settled at the stated value, no gain or loss was recorded as a result of the settlement of this preexisting relationship. The payable does not bear interest and is required to be paid to the Seller on the date that is 18 months after the closing. Refer to Note 6 – Debt and Note 15 – Subsequent Events for further information related to amendments of the terms of the payable due to the Seller. The Company will have the right to set off against the payable any amounts that become payable by the Seller on account of indemnification obligations under the purchase agreement. This business is reported as part of our RMS reportable segment. In accordance with ASC 805-740, the Company established a deferred tax liability with an offset to goodwill in connection with the accounting for the opening balance sheet of the OBRC acquisition as a result of book-to-tax differences primarily related to the intangible assets and property and equipment. The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date: January 27, 2022 Assets acquired and liabilities assumed: Cash 5,481 Trade receivables and contract assets 2,025 Inventories 9,400 Prepaid expenses and other current assets 2,609 Property and equipment 8,336 Goodwill 18,624 Intangible assets 13,400 Accounts payable (552) Accrued expenses and other liabilities (285) Fees invoiced in advance (6,548) Deferred tax liabilities (3,216) $ 49,274 Inventory is comprised of NHP research models. The fair value was determined using a comparative sales methodology, in which the intent is to ensure that the acquirer only recognizes profits associated to value added subsequent to the acquisition date. Property and equipment is mostly composed of land, building and equipment. The fair value of property and equipment was determined using a combination of cost and market-based methodologies. Intangible assets primarily relate to customer relationships and technology associated with the ability to produce and care for the research models. The acquired definite-lived intangible assets are being amortized over a weighted-average estimated useful life of approximately 10 years on a straight-line basis. The estimated fair values of identifiable intangible assets were determined using the "income approach," which is a valuation technique that provides an estimate of the fair value of an asset based on market participant expectations of the cash flows an asset would generate over its remaining useful life. Some of the significant assumptions inherent in the development of these asset valuations include the estimated net cash flows for each year for each asset or product (including revenues and EBITDA), the appropriate discount rate necessary to measure the risk inherent in each future cash flow stream, the life cycle of each asset, the potential regulatory and commercial success risk, and competitive trends impacting the asset and each cash flow stream, as well as other factors. In accordance with ASC 805-740, the Company established a deferred tax liability with an offset to goodwill in connection with the accounting for the opening balance sheet of the OBRC acquisition as a result of book-to-tax differences primarily related to the intangible assets and step up on the fair value of inventory. Goodwill, which is derived from the enhanced scientific expertise, expanded client base and our ability to provide broader service solutions through a comprehensive portfolio, is recorded based on the amount by which the purchase price exceeds the fair value of the net assets acquired and none is deductible for tax purposes. Goodwill from this transaction is allocated to the Company’s RMS reportable segment. Histion Acquisition On April 25, 2022, the Company completed the acquisition of Histion, LLC (“Histion”), which is a strategic element of the Company’s expansion of its specialized pathology services. Consideration for the Histion acquisition consisted of (i) $950 in cash, subject to working capital adjustments, (ii) 17,618 of the Company’s common shares valued at $364 using the closing price of the Company’s common shares on April 25, 2022 and (iii) unsecured subordinated promissory notes payable to the former shareholders of Histion in an aggregate principal amount of $433. Protypia Acquisition On July 7, 2022, the Company entered into a Stock Purchase Agreement with Protypia, Inc. (“Protypia”), which is a strategic element of the Company’s expansion of its mass spectrometry-based bioanalytical offerings providing for the acquisition by the Company of all of the outstanding stock of Protypia on that date. Consideration for the Protypia stock consisted of $9,460 in cash, subject to certain adjustments, $600 in seller notes and 74,997 common shares having a value of approximately $806 based on the opening stock price of the Company’s common shares as reported by Nasdaq on the closing date. The following table summarizes the preliminary fair value of assets acquired and liabilities assumed as of the acquisition date: Preliminary Allocation as of March 31, 2023 Assets acquired and liabilities assumed: Goodwill 6,002 Intangible assets 5,600 Other liabilities, net (84) Deferred tax liabilities (652) $ 10,866 The preliminary purchase price allocation is subject to change as additional information becomes available concerning the fair value and tax basis of the assets acquired and liabilities assumed, including intangible assets, goodwill and deferred tax liabilities. From the date of the acquisition through March 31, 2023, the Company recorded measurement-period adjustments related to the acquisition that resulted in changes to the purchase price allocation. Any additional adjustments to the purchase price allocation will be made as soon as practicable but no later than one year from the date of acquisition. Intangible assets primarily relate to customer relationships and technology associated with the ability to perform specialized protein and peptide mass spectrometry analysis. The acquired definite-lived intangible assets are being amortized over a weighted-average estimated useful life of approximately 8.6 years on a straight-line basis. The estimated fair values of identifiable intangible assets were determined using the "income approach," which is a valuation technique that provides an estimate of the fair value of an asset based on market participant expectations of the cash flows an asset would generate over its remaining useful life. Some of the significant assumptions inherent in the development of these asset valuations include the estimated net cash flows for each year for each asset or product (including revenues and EBITDA), the appropriate discount rate necessary to measure the risk inherent in each future cash flow stream, the life cycle of each asset, the potential regulatory and commercial success risk, and competitive trends impacting the asset and each cash flow stream, as well as other factors. The fair value of intangible assets is based on preliminary assumptions which are subject to change as we complete our valuation procedures. In accordance with ASC 805-740, the Company established a deferred tax liability with an offset to goodwill in connection with the accounting for the opening balance sheet of the Protypia acquisition as a result of book-to-tax differences primarily related to the intangible assets. Goodwill, which is derived from the enhanced scientific expertise and our ability to provide broader service solutions through a comprehensive portfolio, is recorded based on the amount by which the purchase price exceeds the fair value of the net assets acquired and none is deductible for tax purposes. Goodwill from this transaction is allocated to the Company’s DSA reportable segment. Pro Forma Results The Company’s unaudited pro forma results of operations for the three and six months ended March 31, 2022, assume that the acquisitions had occurred as of October 1, 2021. Pro forma information for the three and six months ended March 31, 2023, is not presented here, as the statement of operations for the three and six months ended March 31, 2023, includes all business combinations. The following pro forma amounts are based on available information of the results of operations prior to the acquisition date and are not necessarily indicative of what the results of operations would have been had the acquisitions been completed on October 1, 2021. The unaudited pro forma information is as follows: Three Months Ended Six Months Ended March 31, 2022 March 31, 2022 Total revenues $ 144,027 $ 269,721 Net loss $ (71,731) $ (98,475)

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS	6 Months Ended
GOODWILL AND INTANGIBLE ASSETS	Mar. 31, 2023
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS	Goodwill The following is a rollforward of the Company’s goodwill: September 30, 2022 Acquisitions Impairment March 31, 2023 DSA $ 91,458 $ 2,828 $ — $ 94,286 RMS 302,372 — — 302,372 Gross Carrying Amount 393,830 2,828 — 396,658 Accumulated impairment loss - RMS (236,005) — (66,367) (302,372) Goodwill $ 157,825 $ 2,828 $ (66,367) $ 94,286 The Company determined that as a result of the November 16, 2022 event, which led to the Company’s decision to refrain from selling or delivering any of its Cambodian NHPs held in the U.S., the uncertainty related to the Company’s ability to import NHPs from Cambodia and the decrease in its stock price, the carrying value of goodwill as of December 31, 2022, was required to be quantitatively evaluated. The carrying value of the Company’s goodwill by reporting unit was determined utilizing the income approach. Based on the Company’s quantitative goodwill impairment test, the fair value of the DSA reporting unit exceeded the reporting unit’s carrying value and, therefore, goodwill was not impaired. However, the fair value of the RMS reporting unit was less than the RMS reporting unit’s carrying value. As a result, a goodwill impairment loss of $66,367 was recorded within the RMS segment. The remaining goodwill balance as of March 31, 2023 is attributed to the DSA segment. Further, certain measurement period adjustments related to the acquisitions of Histion and Protypia were identified during the three months ended March 31, 2023, which are reflected as changes in goodwill due to acquisitions within the Company’s DSA reportable segment. Intangible Assets, Net The following table displays intangible assets, net by major class: March 31, 2023 Carrying Accumulated Carrying Amount, Gross Amortization Amount, Net Customer relationships $ 317,061 $ (40,821) $ 276,240 Intellectual property 56,591 (9,037) 47,554 Non-compete agreements 2,410 (1,100) 1,310 Other 2,396 (1,239) 1,157 $ 378,458 $ (52,197) $ 326,261 September 30, 2022 Carrying Accumulated Carrying Amount, Gross Amortization Amount, Net Customer relationships $ 318,896 $ (26,990) $ 291,906 Intellectual property 56,997 (5,767) 51,230 Non-compete agreements 2,410 (872) 1,538 Other 2,396 (1,184) 1,212 $ 380,699 $ (34,813) $ 345,886 The decrease in intangible assets, net during the six months ended March 31, 2023 related to measurement period adjustments to intangible assets for the Protypia acquisition, partially offset by amortization over the applicable useful lives and by the impact of foreign exchange rates.

DEBT

DEBT	6 Months Ended
DEBT	Mar. 31, 2023
DEBT
DEBT	6. Long term debt as of March 31, 2023 and September 30, 2022 is detailed in the table below. March 31, 2023 September 30, 2022 Seller Note – Bolder BioPath 714 808 Seller Note – Preclinical Research Services 578 615 Seller Note – Plato BioPharma 214 1,470 Seller Payable - Orient BioResource Center 3,594 3,488 Seller Note – Histion 301 369 Seller Note – Protypia 600 600 Economic Injury Disaster Loan 140 140 Convertible Senior Notes 107,729 104,965 Term Loan Facility, DDTL and Incremental Term Loans 273,188 238,200 387,058 350,655 Less: Current portion (4,023) (7,979) Less: Debt issuance costs not amortized (12,995) (11,999) Total long-term debt $ 370,040 $ 330,677 Revolving Credit Facility As of March 31, 2023 and September 30, 2022, the Company had a $0 and $15,000 outstanding balance on the revolving credit facility. Refer to the statements of cash flows for information related to borrowings and paydowns of the revolving credit facility during the six months ended March 31, 2023. Significant Transactions On October 12, 2022, the Company drew its $35,000 delayed draw term loan (the “Additional DDTL”) allowed under the First Amendment to the Credit Agreement (“First Amendment”). A portion of the proceeds were used to repay the $15,000 balance on the Company’s revolving credit facility, while the remaining was drawn to fund a portion of the Company’s capital expenditures in fiscal year 2022 and those planned for fiscal year 2023. On December 29, 2022 and January 9, 2023, the Company, the lenders party thereto, and Jefferies Finance LLC, as administrative agent (the “Agent”), entered into the Second and Third Amendments, respectively, to the Credit Agreement. Refer below for further information related to those amendments. Term Loan Facility, DDTL and Incremental Term Loans Credit Agreement On November 5, 2021, the Company, certain subsidiaries of the Company (the “Subsidiary Guarantors”), the lenders party thereto, and the Agent, entered into a Credit Agreement (the “Credit Agreement”). The Credit Agreement provides for a term loan facility in the original principal amount of $165,000, a delayed draw term loan facility in the original principal amount of $35,000 (available to be drawn up to 18 months from the date of the Credit Agreement) (the “Initial DDTL” and together with the Additional DDTL, the “DDTL”) and a revolving credit facility in the original principal amount of $15,000. On November 5, 2021, the Company borrowed the full amount of the term loan facility, but did not borrow any amounts on the delayed draw term loan facility or the revolving credit facility. The Company may elect to borrow on each of the loan facilities at either an adjusted LIBOR rate of interest or an adjusted prime rate of interest. Adjusted LIBOR rate loans shall accrue interest at an annual rate equal to the LIBOR rate plus a margin of between 6.00% and 6.50%, depending on the Company’s then current Secured Leverage Ratio (as defined in the Credit Agreement). The LIBOR rate must be a minimum of 1.00%. The initial adjusted LIBOR rate of interest is the LIBOR rate plus 6.25%. Adjusted prime rate loans shall accrue interest at an annual rate equal to the prime rate plus a margin of between 5.00% and 5.50%, depending on the Company’s then current Secured Leverage Ratio. The initial adjusted prime rate of interest is the prime rate plus 5.25%. For the term loan facility, interest expense was accrued at an effective rate of 10.40% and 10.32% The Company must pay (i) a fee based on a percentage per annum equal to 0.50% on the average daily undrawn portion of the commitments in respect of the revolving credit facility and (ii) a fee based on a percentage per annum equal to 1.00% on the average daily undrawn portion of the commitments in respect of the delayed draw loan facility. In each case, such fee shall be paid quarterly in arrears. Each of the term loan facility and delayed draw term loan facility require annual principal payments in an amount equal to 1.00% of their respective original principal amounts. The Company shall also repay the term loan facility on an annual basis in an amount equal to a percentage of its Excess Cash Flow (as defined in the Credit Agreement), which percentage will be determined by its then current Secured Leverage Ratio. Each of the loan facilities may be repaid at any time. Voluntary prepayments will be subject to a 1% prepayment premium if made on or prior to November 5, 2023 and other breakage penalties, as defined in the Credit Agreement. Voluntary prepayments made after November 5, 2023 are not subject to 1% prepayment premium. The Company is required to maintain an initial Secured Leverage Ratio of not more than 4.25 to 1.00. The maximum permitted Secured Leverage Ratio shall reduce to 3.75 to 1.00 beginning with the Company’s fiscal quarter ending September 30, 2023 and to 3.00 to 1.00 beginning with the Company’s fiscal quarter ending March 31, 2025. The Company is required to maintain a minimum Fixed Charge Coverage Ratio (as defined in the Credit Agreement), which ratio shall be 1.00 to 1.00 during the first year of the Credit Agreement and shall be 1.10 to 1.00 from and after the Credit Agreement’s first anniversary. Each of the loan facilities is secured by all assets (other than certain excluded assets) of the Company and each of the Subsidiary Guarantors. Repayment of each of the loan facilities is guaranteed by each of the Subsidiary Guarantors. Utilizing proceeds from the Credit Agreement on November 5, 2021, the Company repaid all indebtedness and terminated the credit agreement related to the First Internet Bank of Indiana (“FIB”) credit facility and recognized an $877 loss on debt extinguishment during the six months ended March 31, 2022. On January 7, 2022, the Company drew $35,000 on the Initial DDTL. Amounts outstanding under the Initial DDTL accrue interest at an annual rate equal to the LIBOR rate plus a margin of between 6.00% and 6.50%, depending on the Company’s then current Secured Leverage Ratio (as defined in the Credit Agreement). The initial adjusted LIBOR rate of interest is the LIBOR rate plus 6.25%. For the Initial DDTL, interest expense was accrued at an effective rate of 10.45% and 10.35% for the three and six months ended March 31, 2023, respectively. First Amendment to Credit Agreement On January 27, 2022, the Company, Subsidiary Guarantors, the lenders party thereto, and the Agent entered into the First Amendment to the existing Credit Agreement. The First Amendment provides for, among other things, an increase to the existing term loan facility in the amount of $40,000 (the “Incremental Term Loans”) and the Additional DDTL in the original principal amount of $35,000, which amount is available to be drawn up to 24 months from the date of the First Amendment. The Incremental Term Loans and any amounts borrowed under the Additional DDTL are referred to herein as the “Additional Term Loans”. On January 27, 2022, the Company borrowed the full amount of the Incremental Term Loans, and on October 12, 2022, the Company borrowed the full $35,000 under the Additional DDTL. Amounts outstanding under the Additional Term Loans will accrue interest at an annual rate equal to the LIBOR rate plus a margin of between 6.00% and 6.50%, depending on the Company’s then current Secured Leverage Ratio (as defined in the Credit Agreement). The initial adjusted LIBOR rate of interest is the LIBOR rate plus 6.25%. For the Additional DDTL, interest expense was accrued at an effective rate of 10.68% and 11.07% for the three and six months ended March 31, 2023, respectively. The Additional Term Loans require annual principal payments in an amount equal to 1.0% of the original principal amount. Voluntary prepayments of the Additional Term Loans will be subject to a 1% prepayment premium if made on or prior to November 5, 2023 and other breakage penalties, as defined in the Credit Agreement. Voluntary prepayments made after November 5, 2023 are not subject to 1% prepayment premium. The Company shall also repay the term loans on an annual basis in an amount equal to a percentage of its Excess Cash Flow (as defined in the Credit Agreement), which percentage will be determined by its then current Secured Leverage Ratio. The Additional Term Loans are secured by all assets (other than certain excluded assets) of the Company and each of the Subsidiary Guarantors. Repayment of the Additional Term Loans is guaranteed by each of the Subsidiary Guarantors. The Additional Term Loans will mature on November 5, 2026. Second Amendment to Credit Agreement On December 29, 2022, the Company, the Subsidiary Guarantors, the lenders party thereto, and the Agent, entered into a Second Amendment (the “Second Amendment”) to the Credit Agreement. The Second Amendment provides for, among other things, an extension of the deadline for the Company to provide to the lenders the audited financial statements for the Company’s fiscal year ended September 30, 2022 and an annual budget for 2023; the Company satisfied these requirements by the extended deadline. The Second Amendment adds a requirement that the Company provide, within 30 days after the end of each month, an unaudited consolidated balance sheet, statement of income and statement of cash flows as of the end of, and for, such month, as well as a “key performance indicator” report. The Second Amendment also requires that, within 10 business days after the end of each month, the Company will provide a rolling 13-week cash flow forecast prepared on a monthly basis. The Second Amendment further provides that, upon the request of the Required Lenders (as defined in the Credit Agreement), the Company will permit a financial advisor designated by the Required Lenders to meet with management of the Company to discuss the affairs, finances, accounts and condition of the Company during the six-month period following the effective date of the Second Amendment. In addition, the Second Amendment requires the Company to deliver an updated organization chart and certain supplemental information regarding the Company’s subsidiaries in connection with each quarterly report required pursuant to the Credit Agreement. Under the Second Amendment , the Company may elect to borrow on each of the loan facilities at either an adjusted term secured overnight financing rate (“Term SOFR”) rate of interest or an alternate base rate of interest. Adjusted Term SOFR loans shall accrue interest at an annual rate equal to the applicable Term SOFR rate plus (i) an adjustment percentage equal to between 0.11448% and 0.42826% , depending on the term of the loan (“Adjusted Term SOFR”); provided that, Adjusted Term SOFR shall never be less than 1.00% , and (ii) a margin of between 6.00% and 6.50% , depending on the Company’s then current Secured Leverage Ratio (as defined in the Credit Agreement). Alternate base rate loans shall accrue interest at an annual rate equal to (i) the highest of (a) the Federal Funds Effective Rate (as defined in the Credit Agreement) plus 0.5% , (b) the Agent’s prime rate and (c) Adjusted Term SOFR for a one-month tenor plus 1.00% (the “Alternate Base Rate”); provided that, the Alternate Base Rate shall never be less than 2.00% , plus (ii) a margin of between 5.00% and 5.50% , depending on the Company’s then current Secured Leverage Ratio. The Second Amendment also provides that the Company may not request any credit extensions under the revolving credit facility under the Credit Agreement, if any of the conditions precedent set forth in Section 4.02 of the Credit Agreement cannot be satisfied, including, without limitation, the making of the representation and warranty that as of the date of the most recent audited financial statements delivered to the Agent, no event, change, circumstance, condition, development or occurrence has had, or would reasonably be expected to result in, either individually or in the aggregate, a Material Adverse Effect (as defined in the Credit Agreement). In addition, the Second Amendment provides that, no later than January 13, 2023 (or such later date as the Required Lenders shall agree in their discretion), the Company shall (i) appoint a financial advisor on terms reasonably acceptable to the Required Lenders and the Company for a term of at least six months, (ii) provide a 13-week budget to the Agent, and (iii) deliver a perfection certificate supplement updating certain information previously provided with respect to each of the Company and the Subsidiary Guarantors, including information regarding certain collateral and other assets owned by such parties. The Company has timely satisfied each of these requirements. Third Amendment to Credit Agreement On January 9, 2023, the Company, the Subsidiary Guarantors, the lenders party thereto, and the Agent, entered into a Third Amendment (“Third Amendment”) to the Credit Agreement. The Third Amendment provides that, among other things, during the period beginning on January 9, 2023 and, subject to the terms of the Credit Agreement, ending on the date on which financial statements for the Company’s fiscal quarter ending March 31, 2024 are delivered or are required to be delivered, as long as no event of default has occurred (the “Amendment Relief Period”): ● the Cambodian NHP-related matters, to the extent existing and disclosed to the lenders prior to December 29, 2022, shall not constitute a Material Adverse Effect under the Credit Agreement and will not restrict the Company’s ability to request credit extensions under the revolving credit facility; ● the use of borrowings under the revolving credit facility is limited to funding operational expenses of the Company in the ordinary course and cannot be used for the making or funding of investments, permitted acquisitions or restricted payments, payments or purchases with respect to any indebtedness, bonuses or executive compensation, or judgments, fines or settlements; and ● additional limitations are imposed on the Company under the Credit Agreement, including restrictions on permitted asset sales, a prohibition on making permitted acquisitions, and significant limitations on the ability to incur additional debt, make investments and make restricted payments. The Third Amendment provides that from and after the date thereof, no incremental facilities under the Credit Agreement may be established or incurred. The Third Amendment also provides for additional mandatory prepayments of borrowed amounts following the receipt by the Company of certain cash receipts, including proceeds from certain equity issuances and cash received by the Company not in the ordinary course of business. Under the Third Amendment, after any draw on the revolving credit facility, the Company’s cash and cash equivalents held on hand domestically within the U.S. cannot exceed $10,000 . Under the Third Amendment, the Company may elect to borrow on each of the loan facilities accruing interest at either an adjusted secured overnight financing rate (“Term SOFR”) or an alternate base rate of interest. SOFR loans shall accrue interest at an annual rate equal to the applicable Term SOFR rate plus (i) an adjustment percentage equal to between 0.11448% and 0.42826%, depending on the term of the loan (“Adjusted Term SOFR”), provided that, the Adjusted Term SOFR shall never be less than 1.00% per annum, plus (ii) an applicable margin of 6.75% per annum for term loans maintained as SOFR loans or 9.50% per annum for revolving loans maintained as SOFR loans. Alternate base rate loans shall accrue interest at an annual rate equal to (i) the highest of (a) the Federal Funds Effective Rate (as defined in the Credit Agreement) plus 0.50%, (b) the Agent’s prime rate and (c) Adjusted Term SOFR for a one-month tenor plus 1.00% (the “Alternate Base Rate”), provided that, the Alternate Base Rate is subject to a floor of 2.00% per annum plus (ii) an applicable margin of 5.75% per annum for term loans maintained as Alternate Base Rate loans or 8.50% per annum for revolving loans maintained as Alternate Base Rate loans. The fee consideration payable by the Company for each consenting lender party to the Third Amendment is: (i) 0.50% of the aggregate outstanding principal amount of the term loans held by each consenting term loan lender, to be paid in-kind and capitalized to the principal amounts of the term loans held by such lender; (ii) 0.50% of the aggregate outstanding principal amount of the term loans held by each consenting term loan lender, to be paid in cash upon the occurrence of certain prepayments of the term loan under the Credit Agreement; and (iii) 7.00% of the aggregate amount of the revolving commitments held by each consenting revolving lender, to be paid in cash upon the occurrence with certain permanent reductions of the revolving loans under the Credit Agreement Acquisition-related Debt (Seller Notes) In addition to the indebtedness under the Credit Agreement, certain of the Company’s subsidiaries have issued unsecured notes as partial payment of the purchase prices of certain acquisitions as described herein. Each of these notes is subordinated to the indebtedness under the Credit Agreement. As part of the acquisition of Plato, which is a part of the Company’s Inotiv Boulder subsidiary, Inotiv Boulder, LLC, the Company issued unsecured subordinated promissory notes payable to the former shareholders of Plato in an aggregate principal amount of $3,000. The promissory notes bear interest at a rate of 4.5% per annum, with monthly payments of principal and interest and a maturity date of June 1, 2023. As part of the acquisition of OBRC, the Company agreed to leave in place a payable owed by OBRC to the Seller in the amount of $3,700, which the Company determined to have a fair value of $3,325 as of January 27, 2022. The payable does not bear interest and was originally required to be paid to the Seller on the date that is 18 months after the closing date of January 27, 2022. The Company has the right to set off against the payable any amounts that become payable by the Seller on account of indemnification obligations under the purchase agreement. On April 4, 2023, the Company and the Seller entered into a First Amendment to extend the maturity date of the payable to July 27, 2024. Since, prior to March 31, 2023, management intended to extend the maturity date, the payable is presented as a long-term liability as of March 31, 2023, reflecting the amended maturity date. As part of the acquisition of Histion, which is a part of the Company’s subsidiary, Bronco Research Services, LLC, the Company issued unsecured subordinated promissory notes payable to the former shareholders of Histion in an aggregate principal amount of $433. The promissory notes bear interest at a rate of 4.5% per annum, with monthly payments of principal and interest and a maturity date of April 1, 2025. As part of the acquisition of Protypia, the Company issued unsecured subordinated promissory notes payable to the former shareholders of Protypia in an aggregate principal amount of $600. The promissory notes bear interest at a rate of 4.5% per annum, with monthly payments of principal and interest and a maturity date of January 7, 2024. Convertible Senior Notes On September 27, 2021, the Company issued $140,000 principal amount of its 3.25% Convertible Senior Notes due 2027 (the “Notes”). The Notes were issued pursuant to, and are governed by, an indenture, dated as of September 27, 2021, among the Company, the Company’s wholly-owned subsidiary, BAS Evansville, Inc., as guarantor (the “Guarantor”), and U.S. Bank National Association, as trustee (the “Indenture”). Pursuant to the purchase agreement between the Company and the initial purchaser of the Notes, the Company granted the initial purchaser an option to purchase, for settlement within a period of 13 days from, and including, the date the Notes were first issued, up to an additional $15,000 principal amount of the Notes. The Notes issued on September 27, 2021 included $15,000 principal amount of the Notes issued pursuant to the full exercise by the initial purchaser of such option. The Company used the net proceeds from the offering of the Notes, together with borrowings under a new senior secured term loan facility, to fund the cash portion of the purchase price of the Envigo acquisition and related fees and expenses. The Notes are the Company’s senior, unsecured obligations and are (i) equal in right of payment with the Company’s existing and future senior, unsecured indebtedness; (ii) senior in right of payment to the Company’s existing and future indebtedness that is expressly subordinated to the Notes; (iii) effectively subordinated to the Company’s existing and future secured indebtedness, to the extent of the value of the collateral securing that indebtedness; and (iv) structurally subordinated to all existing and future indebtedness and other liabilities, including trade payables, and (to the extent the Company is not a holder thereof) preferred equity, if any, of the Company’s non-guarantor subsidiaries. The Notes are fully and unconditionally guaranteed, on a senior, unsecured basis, by the Guarantor. The Notes accrue interest at a rate of 3.25% per annum, payable semi-annually in arrears on April 15 and October 15 of each year, beginning on April 15, 2022. The Notes will mature on October 15, 2027, unless earlier repurchased, redeemed or converted. Before April 15, 2027, noteholders have the right to convert their Notes only upon the occurrence of certain events. From and after April 15, 2027, noteholders may convert their Notes at any time at their election until the close of business on the scheduled trading day immediately before the maturity date. The Company will settle conversions by paying or delivering, as applicable, cash, its common shares or a combination of cash and its common shares, at the Company’s election. The initial conversion rate is 21.7162 common shares per $1 principal amount of Notes, which represents an initial conversion price of approximately $46.05 per common share. The conversion rate and conversion price are subject to customary adjustments upon the occurrence of certain events. In addition, if certain corporate events that constitute a “Make-Whole Fundamental Change” (as defined in the Indenture) occur, then the conversion rate will, in certain circumstances, be increased for a specified period of time. As of March 31, 2023 and September 30, 2022, there were $4,620 and $5,060, respectively, in unamortized debt issuance costs related to the Notes. For the three months ended March 31, 2023, the total interest expense was $2,740, including coupon interest expense of $1,138, accretion expense of $1,383, and the amortization of debt discount and issuance costs of $219. During the three months ended March 31, 2022, the total interest expense was $2,603, including coupon interest expense of $1,138, accretion expense of $1,257, and the amortization of debt discount and issuance costs of $208. For the six months ended March 31, 2023, the total interest expense was $5,504, including coupon interest expense of $2,300, accretion expense of $2,764, and the amortization of debt discount and issuance costs of $440. During the six months ended March 31, 2022, the total interest expense was $5,230, including coupon interest expense of $2,300, accretion expense of $2,512, and the amortization of debt discount and issuance costs of $418. The Notes are redeemable, in whole and not in part, at the Company’s option at any time on or after October 15, 2024 and on or before the 40th scheduled trading day immediately before the maturity date, but only if the last reported sale price per common share of the Company exceeds 130% of the conversion price on (i) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related redemption notice; and (ii) the trading day immediately before the date the Company sends such notice. The redemption price is a cash amount equal to the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. In addition, calling the Notes for redemption pursuant to the provisions described in this paragraph will constitute a Make-Whole Fundamental Change, which will result in an increase to the conversion rate in certain circumstances for a specified period of time. If certain corporate events that constitute a “Fundamental Change” (as defined in the Indenture) occur, then noteholders may require the Company to repurchase their Notes at a cash repurchase price equal to the principal amount of the Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the Fundamental Change repurchase date. The definition of Fundamental Change includes certain business combination transactions involving the Company and certain de-listing events with respect to the Company’s common shares. The Notes have customary provisions relating to the occurrence of “Events of Default” (as defined in the Indenture), which include the following: (i) certain payment defaults on the Notes (which, in the case of a default in the payment of interest on the Notes, are subject to a 30-day cure period); (ii) the Company’s failure to send certain notices under the Indenture within specified periods of time; (iii) the failure by the Company or the Guarantor to comply with certain covenants in the Indenture relating to the ability of the Company or the Guarantor to consolidate with or merge with or into, or sell, lease or otherwise transfer, in one transaction or a series of transactions, all or substantially all of the assets of the Company or the Guarantor, as applicable, and its subsidiaries, taken as a whole, to another person; (iv) a default by the Company or the Guarantor in its other obligations or agreements under the Indenture or the Notes if such default is not cured or waived within 60 days after notice is given in accordance with the Indenture; (v) certain defaults by the Company, the Guarantor or any of their respective subsidiaries with respect to indebtedness for borrowed money of at least $20,000; (vi) the rendering of certain judgments against the Company, the Guarantor or any of their respective subsidiaries for the payment of at least $20,000, where such judgments are not discharged or stayed within 60 days after the date on which the right to appeal has expired or on which all rights to appeal have been extinguished; (vii) certain events of bankruptcy, insolvency and reorganization involving the Company, the Guarantor or any of their respective significant subsidiaries; and (viii) the guarantee of the Notes ceases to be in full force and effect (except as permitted by the Indenture) or the Guarantor denies or disaffirms its obligations under its guarantee of the Notes. If an Event of Default involving bankruptcy, insolvency or reorganization events with respect to the Company or the Guarantor (and not solely with respect to a significant subsidiary of the Company or the Guarantor) occurs, then the principal amount of, and all accrued and unpaid interest on, all of the Notes then outstanding will immediately become due and payable without any further action or notice by any person. If any other Event of Default occurs and is continuing, then the trustee, by notice to the Company, or noteholders of at least 25% of the aggregate principal amount of Notes then outstanding, by notice to the Company and the trustee, may declare the principal amount of, and all accrued and unpaid interest on, all of the Notes then outstanding to become due and payable immediately. However, notwithstanding the foregoing, the Company may elect, at its option, that the sole remedy for an Event of Default relating to certain failures by the Company to comply with certain reporting covenants in the Indenture consists exclusively of the right of the noteholders to receive special interest on the Notes for up to 180 days at a specified rate per annum not exceeding 0.50% on the principal amount of the Notes. In accordance with ASC 815, at issuance, the Company evaluated the convertible feature of the Notes and determined it was required to be bifurcated as an embedded derivative and did not qualify for equity classification. The convertible feature of the Notes is subject to fair value remeasurement as of each balance sheet date or until it meets equity classification requirements and is valued utilizing Level 3 inputs as described below. The discount resulting from the initial fair value of the embedded derivative will be amortized to interest expense using the effective interest method. Non-cash interest expense during the period primarily related to this discount. In the first quarter of 2022, the Company adopted Accounting Standards Update (“ASU”) ASU 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”). The update simplifies the accounting for convertible debt instruments and convertible preferred shares by reducing the number of accounting models and limiting the number of embedded conversion features separately recognized from the primary contract. As a result of the approval of the increase in authorized shares on November 4, 2021 (see Note 12 – Equity, Stock-Based Compensation and Loss Per Share), the Note conversion rights met all equity classification criteria in ASC 815. As a result, the derivative liability was remeasured as of November 4, 2021 and reclassified out of long-term liabilities and into additional paid-in capital. Based upon the above, the Company remeasured the fair value of the embedded derivative as of November 4, 2021, which resulted in a fair value measurement of $88,576 and a loss on remeasurement included in other income (loss) for the six months ended March 31, 2022 of $56,714.

SUPPLEMENTAL BALANCE SHEET INFO

SUPPLEMENTAL BALANCE SHEET INFORMATION	6 Months Ended
SUPPLEMENTAL BALANCE SHEET INFORMATION	Mar. 31, 2023
SUPPLEMENTAL BALANCE SHEET INFORMATION
SUPPLEMENTAL BALANCE SHEET INFORMATION	7. Trade receivables and contract assets, net consisted of the following: March 31, September 30, 2023 2022 Trade receivables $ 65,127 $ 88,867 Unbilled revenue 16,410 17,474 Total 81,537 106,341 Less: Allowance for credit losses (7,523) (6,268) Trade receivables and contract assets, net of allowances for credit losses $ 74,014 $ 100,073 Inventories, net consisted of the following: March 31, September 30, 2023 2022 Raw materials $ 2,106 $ 1,757 Work in progress 131 186 Finished goods 4,947 4,933 Research Model Inventory 60,617 68,055 Total 67,801 74,931 Less: Obsolescence reserve (3,515) (3,490) Inventories, net $ 64,286 $ 71,441 Prepaid expenses and other current assets consisted of the following: March 31, September 30, 2023 2022 Advances to suppliers $ 29,195 $ 30,292 Income tax receivable 1,943 366 Prepaid research models 2,812 3,575 Other 6,529 8,250 Prepaid expenses and other current assets $ 40,479 $ 42,483 The composition of other assets is as follows: March 31, September 30, 2023 2022 Long-term advances to suppliers $ 2,250 $ 2,894 Finance lease right-of-use assets, net 65 79 Debt issuance costs - revolving credit facility 384 1,411 Funded status of defined benefit plan 2,507 1,573 Other 1,758 1,567 Other assets $ 6,964 $ 7,524 Accrued expenses consisted of the following: March 31, September 30, 2023 2022 Accrued compensation $ 11,296 $ 17,460 Non-income taxes 2,358 1,200 Accrued interest 5,318 5,228 Other 5,657 7,547 Accrued professional fees 6,329 4,366 Accrued expenses and other liabilities $ 30,958 $ 35,801 The composition of fees invoiced in advance is as follows: March 31, September 30, 2023 2022 Customer deposits $ 36,761 $ 39,222 Deferred revenue 18,435 29,420 Fees invoiced in advance $ 55,196 $ 68,642

DEFINED BENEFIT PLAN

DEFINED BENEFIT PLAN	6 Months Ended
DEFINED BENEFIT PLAN	Mar. 31, 2023
DEFINED BENEFIT PLAN
DEFINED BENEFIT PLAN	8. The Company has a defined benefit plan in the U.K., the Harlan Laboratories UK Limited Occupational Pension Scheme (the "Pension Plan"), which operated through April 2012. As of April 30, 2012, the accumulation of plan benefits of employees in the Pension Plan was permanently suspended and therefore the Pension Plan was curtailed. During the year ending September 30, 2023, the Company expects to contribute $1,237 to the Pension Plan. As of March 31, 2023, the funded status of the defined benefit plan obligation of $2,507 is included in other assets (non-current) in the condensed consolidated balance sheets. The following table provides the components of net periodic benefit costs for the Pension Plan, which is included in general and administrative expenses in the condensed consolidated statements of operations. Three Months Ended Six Months Ended March 31, March 31, 2023 2022 2023 2022 Components of net periodic (benefit) expense: Interest cost $ 182 $ 79 $ 364 $ 137 Expected return on assets (198) (220) (396) (329) Amortization of prior (gain) loss (37) 116 (75) 277 Net periodic (benefit) expense $ (53) $ (25) $ (107) $ 85

OTHER OPERATING EXPENSE

OTHER OPERATING EXPENSE	6 Months Ended
OTHER OPERATING EXPENSE	Mar. 31, 2023
OTHER OPERATING EXPENSE
OTHER OPERATING EXPENSE	9. Other operating expense consisted of the following: Three Months Ended Six Months Ended March 31, March 31, 2023 2022 2023 2022 Acquisition and integration costs $ 105 $ 2,085 $ 1,088 $ 10,893 Restructuring costs 1 1,740 — 2,006 — Startup costs 2,281 1,474 3,786 2,431 Remediation costs 555 507 1,140 946 Other costs 131 384 431 746 Acquisition-related stock compensation costs 2 — — — 23,014 $ 4,812 $ 4,450 $ 8,451 $ 38,030 1 2

RESTRUCTURING AND ASSETS HELD F

RESTRUCTURING AND ASSETS HELD FOR SALE	6 Months Ended
RESTRUCTURING AND ASSETS HELD FOR SALE	Mar. 31, 2023
RESTRUCTURING AND ASSETS HELD FOR SALE
RESTRUCTURING AND ASSETS HELD FOR SALE	10. During June 2022, the Company approved and announced a plan to close its facility in Cumberland. Further, the Company’s site consolidation strategy includes the following sites, which have been identified for relocation of operations: Dublin, Gannat, Blackthorn, RMS St. Louis, Boyertown and Haslett. For the three and six months ended March 31, 2023, the Company incurred immaterial expenses that qualify as exit and disposal costs under GAAP, and does not expect further material charges as a result of the closures and planned site consolidations. Exit and disposal costs were charged to other operating expense. Further, as of March 31, 2023, the liability balance for exit and disposal costs that qualify as employee-related exit and disposal costs was $503. Cumberland and Dublin The Cumberland facility exit was a part of the transfer plan settlement, as further described in Note 14 – Contingencies. The Cumberland facility exit was completed in September 2022. The real property of the Cumberland facility met the criteria for assets held for sale as of March 31, 2023. Further, in connection with this conclusion, the Company determined that the carrying value exceeded the fair value of the real property at the Cumberland facility less costs to sell. As a result, an asset impairment charge of $678 was recorded within the RMS reportable segment during the three months ended March 31, 2023. The Dublin facility transition was completed in November 2022. The operations at both the Cumberland facility and the Dublin facility were within the RMS reporting segment. Gannat, Blackthorn and RMS St. Louis During the three months ended March 31, 2023, the Company completed its consultation with employee representatives at the Gannat and Blackthorn facilities and the closures of both facilities have been approved. The consolidation plans for the Gannat and Blackthorn facilities are expected to be complete by the end of June 2023 and the end of June 2024, respectively. The operations at the Gannat and Blackthorn facilities, which are within the RMS reportable segment, will be consolidated with the operations in Horst, The Netherlands, and Hillcrest, U.K., respectively. During the three months ended March 31, 2023, the Company determined the RMS St. Louis facility will be closing by the end of June 2023. The GEMS operations at the RMS St. Louis facility will be relocated to the DSA St. Louis facility and other operational facilities. The operations at the RMS St. Louis facility are within the RMS reportable segment. Boyertown and Haslett Prior to the acquisition of Envigo, the Boyertown and Haslett facilities were identified for relocation of operations to the Denver, Pennsylvania facility. The exits of the Boyertown and Haslett facilities were completed in March 2023. Further, it was determined that the assets of the Boyertown and Haslett facilities met the criteria for assets held for sale as of March 31, 2023. Israel Prior to the Envigo acquisition, Envigo management signed a Stock Purchase Agreement dated October 6, 2021, to sell its ownership interest in its Israel RMS and Israel CRS businesses (the “Israeli Businesses”) to the management team of the Israel Businesses for $6,650. The sale includes the Company’s 100% ownership in Israel RMS and Israel RMS’s 62.5% ownership interest in Israel CRS. The management team currently owns the 37.5% non-controlling ownership position in Israel CRS. In October 2022, the Company’s Board of Directors approved the sale of the Israeli Businesses. As a result of this approval, and in consideration of the remaining assets held for sale criteria under ASC 360 – Property, Plant and Equipment, the net assets and liabilities of the Israeli Businesses met the criteria for assets held for sale as of March 31, 2023. Assets Held for Sale The assets and liabilities, and the resulting net assets held for sale, of the Israeli Businesses and the Boyertown, Haslett and Cumberland facilities are as follows: March 31, 2023 Assets Current assets: Cash and cash equivalents $ 1,058 Restricted cash 465 Trade receivables and contract assets, net of allowances for credit losses 2,462 Inventories, net 822 Prepaid expenses and other current assets 843 Total current assets $ 5,650 Property and equipment, net 1,620 Total assets $ 7,270 Liabilities Current liabilities: Accounts payable $ 299 Accrued expenses and other liabilities 1,478 Fees invoiced in advance 324 Total liabilities $ 2,101 Net assets held for sale $ 5,169

LEASES

LEASES	6 Months Ended
LEASES	Mar. 31, 2023
LEASES
LEASES	11. The Company records a right-of-use (“ROU”) asset and lease liability for substantially all leases for which it is a lessee, in accordance with ASU 842. Leases with an initial term of 12 months or less are not recorded on the condensed consolidated balance sheets. The Company recognizes lease expense for the leases on a straight-line basis over the lease term. At inception of a contract, the Company considers all relevant facts and circumstances to assess whether or not the contract represents a lease by determining whether or not the contract conveys the right to control the use of an identified asset, either explicit or implicit, for a period of time in exchange for consideration. The Company has various operating and finance leases for facilities and equipment. Facilities leases provide office, laboratory, warehouse, or land that the Company uses to conduct its operations. Facilities leases range in duration from two renewal options Equipment leases provide for office equipment, laboratory equipment or services the Company uses to conduct its operations. Equipment leases range in duration from 30 to 60 months, with either subsequent annual ROU lease assets and lease liabilities that are reported in the Company’s condensed consolidated balance sheets are as follows: March 31, 2023 September 30, 2022 Operating ROU assets, net $ 42,014 $ 32,489 Current portion of operating lease liabilities 10,061 7,982 Long-term operating lease liabilities 32,730 24,854 Total operating lease liabilities $ 42,791 $ 32,836 Finance ROU assets, net $ 65 $ 79 Current portion of finance lease liabilities 39 43 Long-term finance lease liabilities 34 41 Total finance lease liabilities $ 73 $ 84 During the three and six months ended March 31, 2023, the Company had operating lease amortization of $2,466 and $4,401, respectively. During the three and six months ended March 31, 2022, the Company had operating lease amortization of $1,486 and $2,568, respectively. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The components of lease expense related to the Company’s leases for the three and six months ended March 31, 2023 were: Three Months Ended Six Months Ended March 31, March 31, 2023 2022 2023 2022 Operating lease costs: Fixed operating lease costs $ 3,322 $ 1,120 $ 5,914 $ 2,203 Short-term lease costs 50 19 62 44 Lease income (811) (988) (1,485) (1,165) Finance lease costs: Amortization of ROU asset expense 11 6 21 12 Interest on finance lease liability 1 — 2 1 Total lease cost $ 2,573 $ 157 $ 4,514 $ 1,095 The Company serves as lessor to a lessee in five facilities. The gross rental income and underlying lease expense are presented net in the Company’s condensed consolidated statements of operations. The gross rent receivables and underlying lease liabilities are presented gross in the Company’s condensed consolidated balance sheets. Supplemental cash flow information related to leases was as follows: Six Months Ended March 31, 2023 2022 Cash flows included in the measurement of lease liabilities: Operating cash flows from operating leases $ 5,491 $ 2,722 Operating cash flows from finance leases 23 1 Financing cash flows from finance leases 2 13 Non-cash lease activity: ROU assets obtained in exchange for new operating lease liabilities $ 14,080 $ 18,091 ROU assets obtained in exchange for new finance lease liabilities — 10 The weighted average remaining lease term and discount rate for the Company’s operating and finance leases as of March 31, 2023 and 2022 were: March 31, 2023 March 31, 2022 Weighted-average remaining lease term (in years) Operating lease 5.92 6.11 Finance lease 1.92 2.97 Weighted-average discount rate (in percentages) Operating lease 7.85 % 5.01 % Finance lease 4.86 % 4.86 % Lease duration was determined utilizing renewal options that the Company is reasonably certain to execute. As of March 31, 2023, maturities of operating and finance lease liabilities for each of the following five fiscal years and a total thereafter were as follows: Operating Leases Finance Leases 2023 (remainder of fiscal year) $ 5,630 $ 22 2024 10,175 34 2025 8,695 14 2026 7,423 5 2027 5,573 1 Thereafter 19,138 — Total minimum future lease payments 56,634 76 Less interest (13,843) (3) Total lease liability 42,791 73

EQUITY, STOCK-BASED COMPENSATIO

EQUITY, STOCK-BASED COMPENSATION AND LOSS PER SHARE	6 Months Ended
EQUITY, STOCK-BASED COMPENSATION AND LOSS PER SHARE	Mar. 31, 2023
EQUITY, STOCK-BASED COMPENSATION AND LOSS PER SHARE
EQUITY, STOCK-BASED COMPENSATION AND LOSS PER SHARE	12. Increase in Authorized Shares and Equity Plan Reserve On November 4, 2021, the Company’s shareholders approved an amendment to the Company’s Second Amended and Restated Articles of Incorporation to increase the number of authorized shares from 20,000,000 shares, consisting of 19,000,000 common shares and 1,000,000 preferred shares, to 75,000,000 shares, consisting of 74,000,000 common shares and 1,000,000 preferred shares. Approval of this matter by the Inotiv shareholders was a condition to the closing of the Envigo acquisition. The amendment was effective on November 4, 2021. On November 4, 2021, the Company’s shareholders approved an amendment to the Company’s 2018 Equity Incentive Plan (the “Equity Plan”) to increase the number of shares available for awards thereunder by 1,500,000 shares and to make certain corresponding changes to certain limitations in the Equity Plan. At March 31, 2023, 502,685 shares remained available for grants under the Equity Plan. Stock Issued in Connection with Acquisitions During the three and six months ended March 31, 2023, no common shares were issued in relation to acquisitions. During the three and six months ended March 31, 2022, 1,106,457 and 9,480,595 common shares, respectively, were issued in relation to acquisitions. See Note 4 – Business Combinations for further discussion of consideration for each acquisition. Stock-Based Compensation The Company expenses the estimated fair value of stock options, restricted stock and restricted stock units over the vesting periods of the grants. The Company recognizes expense for awards subject to graded vesting using the straight-line attribution method and forfeitures, as they are incurred. Stock based compensation expense for the three months ended March 31, 2023 and 2022, was $1,781 and $1,138, respectively. Stock based compensation expense for the six months ended March 31, 2023 and 2022, was $3,827 and $25,070, respectively. Of the $25,070 stock based compensation expense during the six months ended March 31, 2022, $23,014 related to post-combination expense recognized in connection with the Envigo transaction (see Note 4 – Business Combinations), which was inclusive of $4,772 of stock based compensation settled in cash. Net Loss per Share The Company computes basic loss per share using the weighted average number of common shares outstanding. The Company computes diluted loss per share using the if-converted method for preferred shares and convertible debt, if any, and the treasury stock method for stock options and restricted stock units. Shares issuable upon exercise of 1,797,189 options and shares issuable upon vesting of 803,972 restricted stock units were not considered in computing diluted loss per share for the three and six months ended March 31, 2023 because they were anti-dilutive. Shares issuable upon exercise of 1,695,070 options and shares issuable upon vesting of 682,357 restricted stock units were not considered in computing diluted loss per share for the three and six months ended March 31, 2022 because they were anti-dilutive. Additionally, there are 3,040,268 shares of common stock issuable upon conversion in connection with the convertible debt entered into on September 27, 2021, which were not considered in computing diluted loss per share for the three and six months ended March 31, 2023 and 2022 because they were anti-dilutive. The following table reconciles the computation of basic net loss per share to diluted net loss per share: Three Months Ended Six Months Ended March 31, March 31, 2023 2022 2023 2022 Basic and diluted net loss per share: Net loss applicable to common shareholders $ (9,994) $ (6,087) $ (97,317) $ (89,134) Weighted average common shares outstanding (in thousands) Basic and diluted: 25,687 25,315 25,645 23,197 Basic and diluted net loss per share $ (0.39) $ (0.24) $ (3.79) $ (3.84)

INCOME TAXES

INCOME TAXES	6 Months Ended
INCOME TAXES	Mar. 31, 2023
INCOME TAXES
INCOME TAXES	13. The Company uses the asset and liability method of accounting for income taxes.  The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. The Company measures deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The Company recognizes the effect on deferred tax assets and liabilities of a change in tax rates in income in the period that includes the enactment date. The Company records valuation allowances based on a determination of the expected realization of tax assets. The Company’s effective tax rates for the three months ended March 31, 2023 and 2022 were 20.4% and 3761.5%, respectively. For the three months ended March 31, 2023, the Company’s effective tax rate was primarily driven by the impact of discrete permanent items. For the three months ended March 31, 2022, the Company’s effective tax rate was driven by the earnings impact of acquisitions and minimal change between actual year-to-date loss before income taxes during the three months ended March 31, 2022 compared to the three months ended December 31, 2021. The Company’s effective tax rates for the six months ended March 31, 2023 and 2022 were 16.0% and 6.2%, respectively. For the six months ended March 31, 2023, the Company’s effective tax rate was primarily related to the impact on tax expense of certain book to tax differences on the deductibility of goodwill impairment and other permanent items. For the six months ended March 31, 2022, the Company’s effective tax rate was primarily related to a release of valuation allowance due to deferred tax liabilities established as part of the acquisition of Envigo, as well as, the impact on tax expense of certain book to tax differences on the deductibility of transaction costs, loss on fair value remeasurement of the embedded derivative component of the convertible notes, and other permanent items. The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not to be sustained upon examination based on the technical merits of the position. The Company measures the amount of the accrual for which an exposure exists as the largest amount of benefit determined on a cumulative probability basis that it believes is more likely than not to be realized upon settlement of the position. The Company settled the previously reported uncertain tax position derived from the acquisition of Envigo with a taxing authority during the three and six months ended March 31, 2023, with no impact on consolidated net loss. As of March 31, 2023, the Company had no material liability for uncertain tax positions. The Company records interest and penalties accrued in relation to the uncertain income tax position as a component of income tax expense (benefit). Any changes in the liability for the uncertain tax position would impact the effective tax rate. The Company does not expect the total amount of unrecognized tax benefits to significantly change in the next twelve months. The Company is subject to income taxes in the U.S. federal jurisdiction, and the various states and foreign jurisdictions in which it operates. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. In the normal course of business, the Company is subject to examination by federal, state, local and foreign taxing authorities. State and other income tax returns are generally subject to examination for a period of  three

CONTINGENCIES

CONTINGENCIES	6 Months Ended
CONTINGENCIES	Mar. 31, 2023
CONTINGENCIES
CONTINGENCIES	14. Litigation Envigo RMS, LLC (“Envigo RMS”) is a defendant in a purported class action and a related action under California’s Private Attorney General Act of 2004 (“PAGA”) brought by Jacob Greenwell, a former employee of Envigo RMS, on June 25, 2021 in the Superior Court of California, Alameda County. The complaints allege that Envigo RMS violated certain wage and hour requirements under the California Labor Code. PAGA authorizes private attorneys to bring claims on behalf of the State of California and aggrieved employees for violations of California’s wage and hour laws. The class action complaint seeks certification of a class of similarly situated employees and the award of actual, consequential and incidental losses and damages for the alleged violations. The PAGA complaint seeks civil penalties pursuant to the California Labor Code and attorney’s fees. The Company intends to continue to vigorously defend these claims. It is not possible to determine the final outcome of this matter, and we cannot reasonably estimate the maximum potential exposure or the range of possible loss in excess of amounts accrued for any of these matters. On June 23, 2022, a putative securities class action lawsuit was filed in the United States District Court for the Northern District of Indiana, naming the Company and Robert W. Leasure and Beth A. Taylor as defendants, captioned Grobler v. Inotiv, Inc., et al., Case No. 4:22-cv-00045 (N.D. Ind.). The complaint alleged violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Act”), as amended, and Rule 10b-5 promulgated thereunder, based on alleged false and misleading statements and material omissions regarding the Company’s acquisition of Envigo RMS and its regulatory compliance. On September 12, 2022, Oklahoma Police Pension and Retirement System was appointed by the Court as lead plaintiff. Thereafter, on November 14, 2022, the lead plaintiff filed an amended complaint against the same defendants, in addition to John E. Sagartz and Carmen Wilbourn, that asserted the same claims along with a claim under Section 14(a) of the Act. On November 23, 2022, the lead plaintiff filed a further amended complaint against the aforementioned defendants asserting the same claims as the amended complaint and further alleging that false and misleading statements and material omissions were made concerning the Company’s non-human primate business. The purported class in the operative complaint includes all persons who purchased or otherwise acquired the Company’s common stock between September 21, 2021 and November 16, 2022, and the complaint seeks an unspecified amount of monetary damages, interest, fees and expenses of attorneys and experts, and other relief. While the Company cannot predict the outcome of this matter, the Company believes the class action to be without merit and plans to vigorously defend itself. We cannot reasonably estimate the maximum potential exposure or the range of possible loss in excess of amounts accrued for this matter. On September 9, 2022, a purported shareholder derivative lawsuit was filed in the United States District Court for the Northern District of Indiana, naming Robert W. Leasure, Beth A. Taylor, Gregory C. Davis, R. Matthew Neff, Richard A. Johnson, John E. Sagartz, Nigel Brown, and Scott Cragg as defendants, and the Company as a nominal defendant, captioned Grobler v. Robert W. Leasure, et al., Case No. 4:22-cv-00064 (N.D. Ind.). The derivative action asserts claims for breach of fiduciary duty, abuse of control, gross mismanagement, and waste of corporate assets, as well as violations of Section 14(a) of the Securities Exchange Act of 1934 arising out of the Company’s acquisition of Envigo and its regulatory compliance. On November 15, 2022, the Court entered an order staying the derivative action pending a resolution of a motion to dismiss in the securities class action. On January 4, 2023, an additional shareholder derivative lawsuit was filed in the United States District Court for the Northern District of Indiana, naming Robert W. Leasure, Beth A. Taylor, Gregory C. Davis, R. Matthew Neff, Richard A. Johnson, John E. Sagartz, Nigel Brown, and Scott Cragg as defendants, and the Company as a nominal defendant, captioned Burkhart v. Robert W. Leasure, et al., Case No 4:23-cv-00003 (N.D. Ind.). The derivative action asserts claims for breach of fiduciary duty, abuse of control, gross mismanagement, and waste of corporate assets, as well as violations of Section 10(b), 21D and 14(a) of the Securities Exchange Act of 1934 arising out of the Company’s acquisition of Envigo and its regulatory compliance. On May 8, 2023, the Court entered an order staying the derivative action pending a resolution of a motion to dismiss in the securities class action. On April 20, 2023, an additional shareholder derivative lawsuit was filed in the State of Indiana Tippecanoe County Circuit Court, naming Robert W. Leasure, Beth A. Taylor, Gregory C. Davis, R. Matthew Neff, Richard A. Johnson, John E. Sagartz, Nigel Brown, and Scott Cragg as defendants, and the Company as a nominal defendant, captioned Whitfield v. Gregory C. Davis, et al., Case No. 79C01-2304-PL-000048 (Tippecanoe Circuit Court). The derivative action asserts claims for breach of fiduciary duty, aiding and abetting breach of fiduciary duty, and waste of corporate assets arising out of the Company’s acquisition of Envigo and its regulatory compliance, and the Company’s non-human primate business. While the Company cannot predict the outcome of these matters, the Company believes the derivative actions to be without merit and plans to vigorously defend itself. We cannot reasonably estimate the maximum potential exposure or the range of possible loss in excess of amounts accrued for any of these matters. The Company is party to certain other legal actions arising out of the normal course of its business. In management's opinion, none of these actions will have a material effect on the Company's operations, financial condition or liquidity. Government Investigations and Actions The Company is subject to and/or involved in various government investigations, inquiries and actions, including those described below. Given their inherent uncertainty, the Company cannot predict the duration or outcome of the pending matters described below. An adverse outcome of any of the following matters could have a material adverse impact on the Company’s operations, financial condition, operating results and cash flows. During the period from July 2021 through March 2022, Envigo RMS’s Cumberland facility was inspected on several occasions by the U.S. Department of Agriculture (“USDA”). USDA issued inspection reports with findings of non-compliance with certain USDA laws and regulations. Envigo RMS formally appealed certain of the findings, and made multiple remediations and improvements at the Cumberland facility, of which it kept USDA apprised. On May 18, 2022, the U.S. Department of Justice (“DOJ”), together with federal and state law enforcement agents, executed a search and seizure warrant on the Cumberland facility. The warrant was issued by the U.S. District Court for the Western District of Virginia on May 13, 2022. EGSI and Inotiv have received grand jury subpoenas and other requests from the U.S. Attorney’s Office for the Western District of Virginia (“USAO-WDVA”) for documents and information related to the companies’ compliance with the Animal Welfare Act (“AWA”), the Clean Water Act, the Virginia State Water Control Law and local pretreatment requirements from January 2017 to present. Certain current and former employees have also received subpoenas for testimony and documents related to these matters. The Company is continuing to cooperate with USAO-WDVA and other involved authorities, and cannot predict the duration or outcome of this investigation. As previously disclosed, on May 19, 2022, a civil complaint was filed by DOJ against Envigo RMS in the U.S. District Court for the Western District of Virginia alleging violations of the AWA at the Cumberland facility. On July 15, 2022, the court approved a settlement entered into by Envigo RMS, DOJ and the USDA in this civil case, which also comprised USDA’s administrative claims against Envigo RMS for the Cumberland facility, and the civil and administrative complaints were dismissed with prejudice on September 14, 2022. This matter is now fully resolved. On June 15, 2021, EGSI, a subsidiary of the Company acquired in the Envigo acquisition, received a grand jury subpoena requested by the U.S. Attorney’s Office for the Southern District of Florida (“USAO-SDFL”) for the production of documents related to the procurement of NHPs from foreign suppliers for the period January 1, 2018 through June 1, 2021. The subpoena relates to an earlier grand jury subpoena requested by the USAO-SDFL and received by EGSI’s predecessor entity, Covance Research Products, in April 2019. Envigo acquired EGSI from Covance, Inc. (“Covance”), a subsidiary of Laboratory Corporation of America Holdings, in June 2019. On January 27, 2022, EGSI acquired OBRC, which owns and operates a primate quarantine and holding facility located near Alice, Texas. In 2019, OBRC received grand jury subpoenas requested by the USAO-SDFL requiring the production of documents and information related to its importation of NHPs into the United States. On June 16, 2021, OBRC received a grand jury subpoena requested by the USAO-SDFL requiring the production of documents related to the procurement of NHPs from foreign suppliers for the period January 1, 2018 through June 1, 2021. The OBRC purchase agreement provides for indemnification of EGSI and its officers, directors and affiliates by the Seller, Orient Bio, Inc., for liabilities resulting from actions, inactions, errors or omissions of Orient Bio, Inc. or OBRC related to any period prior to the closing date. Consistent with Company policy, the Company is cooperating with USAO-SDFL. On November 16, 2022 the Company disclosed that employees of the principal supplier of NHPs to the Company, along with two Cambodian government officials, have been criminally charged by the USAO-SDFL with conspiring to illegally import NHPs into the United States from December 2017 through January 2022 and in connection with seven specific imports between July 2018 and December 2021. As of the filing date of this report, the Company has not received any additional subpoenas related to this matter.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	6 Months Ended
SUBSEQUENT EVENTS	Mar. 31, 2023
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS	15. SUBSEQUENT EVENTS On April 4, 2023, the Company extended by one year the maturity of the seller payable pursuant to the stock purchase agreement (“SPA”) with the Seller of OBRC. The payable, which was originally due on July 27, 2023, is now due on July 27, 2024. This extension did not affect the rights and remedies of any party to the SPA, nor alter, modify or amend or in any way affect any of the terms and conditions, obligations, covenants or agreements contained in the SPA. The seller payable has been presented as long-term debt as of March 31, 2023.

DESCRIPTION OF THE BUSINESS A_2

DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION (Policies)	6 Months Ended
	Mar. 31, 2023
DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION
Basis of Presentation	Basis of Presentation The Company has prepared the accompanying unaudited interim condensed consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles (“GAAP”), and therefore should be read in conjunction with the Company’s audited consolidated financial statements, and the notes thereto, included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2022. In the opinion of management, the condensed consolidated financial statements for the three and six months ended March 31, 2023 and 2022 include all adjustments which are necessary for a fair presentation of the results of the interim periods and of the Company’s financial position at March 31, 2023. The results of operations for the three and six months ended March 31, 2023 are not necessarily indicative of the results for the fiscal year ending September 30, 2023. Certain prior year amounts have been reclassified within the statement of cash flows for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations.
Use of Estimates	Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires the Company to make estimates and judgements that may affect the reported amounts of assets, liabilities, revenues, and expenses, and related disclosures of contingent assets and liabilities. These include, but are not limited to, management estimates in the calculation and timing of revenue recognition, pension liabilities, deferred tax assets and liabilities and the related valuation allowance. Although estimates are based upon management’s best estimate using historical experience, current events, and actions, actual results could differ from those estimates. Changes in estimates are reflected in reported results in the period in which they become known.
Consolidation	Consolidation The accompanying condensed consolidated financial statements are unaudited and have been prepared by the Company, including all subsidiaries and a variable interest entity (“VIE”) it consolidates in accordance with GAAP. The Company consolidates a VIE as a result of the Envigo acquisition. The VIE does not materially impact our net assets or net loss. The Company accounts for noncontrolling interests in accordance with Accounting Standards Codification (“ASC”) 810, “Consolidation” (“ASC 810”). ASC 810 requires companies with noncontrolling interests to disclose such interests as a portion of equity but separate from the parent’s equity. The noncontrolling interests’ portion of net income (loss) is presented on the condensed consolidated statements of operations.
Concentration of Risk	Concentration of Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of trade receivables from customers in the biopharmaceutical, contract research, academic, and governmental sectors. The Company believes its exposure to credit risk is minimal, as the majority of the customers are predominantly well established and viable. Additionally, the Company maintains allowances for potential credit losses. The Company’s exposure to credit loss in the event that payment is not received for revenue recognized equals the outstanding trade receivables and contract assets less fees invoiced in advance. During the three and six months ended March 31, 2023, one customer accounted for 25.0% and 23.6% of sales, respectively. During the three and six months ended March 31, 2022, one customer accounted for 31.4% and 27.4% of sales, respectively. During the three and six months ended March 31, 2023 and 2022, no vendors accounted for more than 10% of cost of revenues.

REVENUE FROM CONTRACTS WITH C_2

REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables)	6 Months Ended
REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables)	Mar. 31, 2023
REVENUE FROM CONTRACTS WITH CUSTOMERS
Schedule of changes in contract assets and liabilities	Balance at Balance at March 31, September 30, 2023 2022 Contract assets: Trade receivables $ 65,127 $ 88,867 Contract assets: Unbilled revenue 16,410 17,474 Contract liabilities: Customer deposits 36,761 39,222 Contract liabilities: Deferred revenue 18,435 29,420

SEGMENT AND GEOGRAPHIC INFORM_2

SEGMENT AND GEOGRAPHIC INFORMATION (Tables)	6 Months Ended
SEGMENT AND GEOGRAPHIC INFORMATION (Tables)	Mar. 31, 2023
SEGMENT AND GEOGRAPHIC INFORMATION
Schedule of operating segments	Three Months Ended Six Months Ended March 31, March 31, 2023 2022 2023 2022 Revenue DSA: Service revenue $ 46,145 $ 38,062 $ 86,116 $ 69,937 Product revenue 878 992 2,000 1,942 RMS: Service revenue 12,607 11,522 22,684 17,823 Product revenue 91,833 89,737 163,417 134,822 $ 151,463 $ 140,313 $ 274,217 $ 224,524 Operating Income (Loss) DSA $ 1,924 $ 3,752 $ 4,296 $ 9,794 RMS 12,725 22,562 (58,547) 22,642 Unallocated Corporate (16,774) (18,446) (38,452) (58,209) $ (2,125) $ 7,868 $ (92,703) $ (25,773) Interest expense (10,515) (7,547) (20,965) (12,375) Other income (expense) 545 (139) (1,333) (57,866) (Loss) income before income taxes $ (12,095) $ 182 $ (115,001) $ (96,014) Three Months Ended Six Months Ended March 31, March 31, 2023 2022 2023 2022 Depreciation and amortization: DSA $ 3,611 $ 3,414 $ 7,591 $ 5,958 RMS 9,379 6,417 18,662 9,908 $ 12,990 $ 9,831 $ 26,253 $ 15,866 Capital expenditures: DSA $ 3,970 3,431 $ 7,264 $ 6,417 RMS 4,501 6,116 9,576 8,785 $ 8,471 $ 9,547 $ 16,840 $ 15,202
Schedule of geographical Information	The following represents revenue originating in entities physically located in the identified geographic area: Three Months Ended Six Months Ended March 31, March 31, 2023 2022 2023 2022 United States $ 129,980 $ 117,890 $ 228,989 $ 190,335 Netherlands 11,522 12,119 26,744 18,655 Other 9,961 10,304 18,484 15,534 $ 151,463 $ 140,313 $ 274,217 $ 224,524
Schedule of Long-lived Assets by Geographic Area	March 31, September 30, 2023 2022 United States $ 173,540 $ 173,417 Netherlands 6,436 5,824 Other 8,520 6,958 $ 188,496 $ 186,199

BUSINESS COMBINATIONS (Tables)

BUSINESS COMBINATIONS (Tables)	6 Months Ended
BUSINESS COMBINATIONS (Tables)	Mar. 31, 2023
BUSINESS COMBINATIONS
Schedule of unaudited pro forma information	The unaudited pro forma information is as follows: Three Months Ended Six Months Ended March 31, 2022 March 31, 2022 Total revenues $ 144,027 $ 269,721 Net loss $ (71,731) $ (98,475)
Plato BioPharma Inc
BUSINESS COMBINATIONS
Schedule of purchase price allocation	The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date: October 4, 2021 Assets acquired and liabilities assumed: Cash 1,027 Trade receivables and contract assets 853 Prepaid expenses and other assets 133 Property and equipment 1,127 Operating lease right-of-use assets, net 2,272 Goodwill 9,279 Intangible assets 4,800 Accounts payable (113) Accrued expenses and other liabilities (343) Operating lease liabilities (2,272) Deferred tax liabilities (1,457) $ 15,306
Envigo RMS Holding Corp
BUSINESS COMBINATIONS
Schedule of purchase price allocation	The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date: November 5, 2021 Assets acquired and liabilities assumed: Cash 2,488 Restricted cash 435 Trade receivables and contract assets 43,566 Inventories 40,000 Prepaid expenses and other current assets 17,373 Property and equipment 106,338 Operating lease right-of-use assets, net 13,229 Goodwill 282,768 Intangible assets - customer relationships 251,000 Intangible assets - intellectual property 49,000 Other assets 7,676 Accounts payable (25,832) Accrued expenses and other liabilities (11,665) Fees invoiced in advance (7,047) Current portion on long-term operating lease (4,371) Long-term operating leases, net (8,634) Other liabilities (5,339) Deferred tax liabilities (77,291) Noncontrolling interest 880 $ 674,574
Schedule of information related to measurement assumptions	Stock price $ 53.31 Strike price $ 9.93 Volatility 75.93 % Expected term 3.05 Risk-free rate 0.62 %
Robinson Services, Inc.
BUSINESS COMBINATIONS
Schedule of purchase price allocation	The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date: December 29, 2021 Assets acquired and liabilities assumed: Customer relationship 4,700 Non-compete agreement 300 Supply agreement 200 Goodwill 948 $ 6,148
Integrated Laboratory Systems, LLC (ILS)
BUSINESS COMBINATIONS
Schedule of purchase price allocation	The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date: January 10, 2022 Assets acquired and liabilities assumed: Cash 797 Trade receivables, contract assets and other current assets 4,730 Property and equipment 4,436 Operating lease right-of-use assets, net 4,994 Goodwill 25,283 Intangible assets 22,300 Accounts payable (1,165) Accrued expenses and other liabilities (905) Fees invoiced in advance (2,472) Operating lease liabilities (4,554) $ 53,444
Orient BioResource Center, Inc
BUSINESS COMBINATIONS
Schedule of purchase price allocation	The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date: January 27, 2022 Assets acquired and liabilities assumed: Cash 5,481 Trade receivables and contract assets 2,025 Inventories 9,400 Prepaid expenses and other current assets 2,609 Property and equipment 8,336 Goodwill 18,624 Intangible assets 13,400 Accounts payable (552) Accrued expenses and other liabilities (285) Fees invoiced in advance (6,548) Deferred tax liabilities (3,216) $ 49,274
Protypia, Inc.
BUSINESS COMBINATIONS
Schedule of purchase price allocation	The following table summarizes the preliminary fair value of assets acquired and liabilities assumed as of the acquisition date: Preliminary Allocation as of March 31, 2023 Assets acquired and liabilities assumed: Goodwill 6,002 Intangible assets 5,600 Other liabilities, net (84) Deferred tax liabilities (652) $ 10,866

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS (Tables)	6 Months Ended
GOODWILL AND INTANGIBLE ASSETS (Tables)	Mar. 31, 2023
GOODWILL AND INTANGIBLE ASSETS
Schedule of changes in goodwill	The following is a rollforward of the Company’s goodwill: September 30, 2022 Acquisitions Impairment March 31, 2023 DSA $ 91,458 $ 2,828 $ — $ 94,286 RMS 302,372 — — 302,372 Gross Carrying Amount 393,830 2,828 — 396,658 Accumulated impairment loss - RMS (236,005) — (66,367) (302,372) Goodwill $ 157,825 $ 2,828 $ (66,367) $ 94,286
Schedule of intangible assets	The following table displays intangible assets, net by major class: March 31, 2023 Carrying Accumulated Carrying Amount, Gross Amortization Amount, Net Customer relationships $ 317,061 $ (40,821) $ 276,240 Intellectual property 56,591 (9,037) 47,554 Non-compete agreements 2,410 (1,100) 1,310 Other 2,396 (1,239) 1,157 $ 378,458 $ (52,197) $ 326,261 September 30, 2022 Carrying Accumulated Carrying Amount, Gross Amortization Amount, Net Customer relationships $ 318,896 $ (26,990) $ 291,906 Intellectual property 56,997 (5,767) 51,230 Non-compete agreements 2,410 (872) 1,538 Other 2,396 (1,184) 1,212 $ 380,699 $ (34,813) $ 345,886

DEBT (Tables)

DEBT (Tables)	6 Months Ended
DEBT (Tables)	Mar. 31, 2023
DEBT
Schedule of long-term debt	March 31, 2023 September 30, 2022 Seller Note – Bolder BioPath 714 808 Seller Note – Preclinical Research Services 578 615 Seller Note – Plato BioPharma 214 1,470 Seller Payable - Orient BioResource Center 3,594 3,488 Seller Note – Histion 301 369 Seller Note – Protypia 600 600 Economic Injury Disaster Loan 140 140 Convertible Senior Notes 107,729 104,965 Term Loan Facility, DDTL and Incremental Term Loans 273,188 238,200 387,058 350,655 Less: Current portion (4,023) (7,979) Less: Debt issuance costs not amortized (12,995) (11,999) Total long-term debt $ 370,040 $ 330,677

SUPPLEMENTAL BALANCE SHEET IN_2

SUPPLEMENTAL BALANCE SHEET INFORMATION (Tables)	6 Months Ended
SUPPLEMENTAL BALANCE SHEET INFORMATION (Tables)	Mar. 31, 2023
SUPPLEMENTAL BALANCE SHEET INFORMATION
Schedule of supplemental balance sheet information related to trade receivables and contract assets, net	Trade receivables and contract assets, net consisted of the following: March 31, September 30, 2023 2022 Trade receivables $ 65,127 $ 88,867 Unbilled revenue 16,410 17,474 Total 81,537 106,341 Less: Allowance for credit losses (7,523) (6,268) Trade receivables and contract assets, net of allowances for credit losses $ 74,014 $ 100,073
Schedule of supplemental balance sheet information related to inventories	Inventories, net consisted of the following: March 31, September 30, 2023 2022 Raw materials $ 2,106 $ 1,757 Work in progress 131 186 Finished goods 4,947 4,933 Research Model Inventory 60,617 68,055 Total 67,801 74,931 Less: Obsolescence reserve (3,515) (3,490) Inventories, net $ 64,286 $ 71,441
Schedule of supplemental balance sheet information related to the composition of prepaid expenses and other current assets	Prepaid expenses and other current assets consisted of the following: March 31, September 30, 2023 2022 Advances to suppliers $ 29,195 $ 30,292 Income tax receivable 1,943 366 Prepaid research models 2,812 3,575 Other 6,529 8,250 Prepaid expenses and other current assets $ 40,479 $ 42,483
Schedule of supplemental balance sheet information related to other assets	The composition of other assets is as follows: March 31, September 30, 2023 2022 Long-term advances to suppliers $ 2,250 $ 2,894 Finance lease right-of-use assets, net 65 79 Debt issuance costs - revolving credit facility 384 1,411 Funded status of defined benefit plan 2,507 1,573 Other 1,758 1,567 Other assets $ 6,964 $ 7,524
Schedule of accrued expenses	Accrued expenses consisted of the following: March 31, September 30, 2023 2022 Accrued compensation $ 11,296 $ 17,460 Non-income taxes 2,358 1,200 Accrued interest 5,318 5,228 Other 5,657 7,547 Accrued professional fees 6,329 4,366 Accrued expenses and other liabilities $ 30,958 $ 35,801
Schedule of fees invoiced in advance	The composition of fees invoiced in advance is as follows: March 31, September 30, 2023 2022 Customer deposits $ 36,761 $ 39,222 Deferred revenue 18,435 29,420 Fees invoiced in advance $ 55,196 $ 68,642

DEFINED BENEFIT PLAN (Tables)

DEFINED BENEFIT PLAN (Tables)	6 Months Ended
DEFINED BENEFIT PLAN (Tables)	Mar. 31, 2023
DEFINED BENEFIT PLAN
Schedule of components of net periodic benefit costs	The following table provides the components of net periodic benefit costs for the Pension Plan, which is included in general and administrative expenses in the condensed consolidated statements of operations. Three Months Ended Six Months Ended March 31, March 31, 2023 2022 2023 2022 Components of net periodic (benefit) expense: Interest cost $ 182 $ 79 $ 364 $ 137 Expected return on assets (198) (220) (396) (329) Amortization of prior (gain) loss (37) 116 (75) 277 Net periodic (benefit) expense $ (53) $ (25) $ (107) $ 85

OTHER OPERATING EXPENSE (Tables

OTHER OPERATING EXPENSE (Tables)	6 Months Ended
OTHER OPERATING EXPENSE (Tables)	Mar. 31, 2023
OTHER OPERATING EXPENSE
Schedule of other operating expense	Other operating expense consisted of the following: Three Months Ended Six Months Ended March 31, March 31, 2023 2022 2023 2022 Acquisition and integration costs $ 105 $ 2,085 $ 1,088 $ 10,893 Restructuring costs 1 1,740 — 2,006 — Startup costs 2,281 1,474 3,786 2,431 Remediation costs 555 507 1,140 946 Other costs 131 384 431 746 Acquisition-related stock compensation costs 2 — — — 23,014 $ 4,812 $ 4,450 $ 8,451 $ 38,030 1 2

RESTRUCTURING AND ASSETS HELD_2

RESTRUCTURING AND ASSETS HELD FOR SALE (Tables)	6 Months Ended
RESTRUCTURING AND ASSETS HELD FOR SALE (Tables)	Mar. 31, 2023
RESTRUCTURING AND ASSETS HELD FOR SALE
Schedule of assets and liabilities and the resulting net assets held for sale	The assets and liabilities, and the resulting net assets held for sale, of the Israeli Businesses and the Boyertown, Haslett and Cumberland facilities are as follows: March 31, 2023 Assets Current assets: Cash and cash equivalents $ 1,058 Restricted cash 465 Trade receivables and contract assets, net of allowances for credit losses 2,462 Inventories, net 822 Prepaid expenses and other current assets 843 Total current assets $ 5,650 Property and equipment, net 1,620 Total assets $ 7,270 Liabilities Current liabilities: Accounts payable $ 299 Accrued expenses and other liabilities 1,478 Fees invoiced in advance 324 Total liabilities $ 2,101 Net assets held for sale $ 5,169

LEASES (Tables)

LEASES (Tables)	6 Months Ended
LEASES (Tables)	Mar. 31, 2023
LEASES
Summary of right-of-use lease assets and lease liabilities that are reported in the Company's condensed consolidated balance sheets	ROU lease assets and lease liabilities that are reported in the Company’s condensed consolidated balance sheets are as follows: March 31, 2023 September 30, 2022 Operating ROU assets, net $ 42,014 $ 32,489 Current portion of operating lease liabilities 10,061 7,982 Long-term operating lease liabilities 32,730 24,854 Total operating lease liabilities $ 42,791 $ 32,836 Finance ROU assets, net $ 65 $ 79 Current portion of finance lease liabilities 39 43 Long-term finance lease liabilities 34 41 Total finance lease liabilities $ 73 $ 84
Summary of components of lease expense	Three Months Ended Six Months Ended March 31, March 31, 2023 2022 2023 2022 Operating lease costs: Fixed operating lease costs $ 3,322 $ 1,120 $ 5,914 $ 2,203 Short-term lease costs 50 19 62 44 Lease income (811) (988) (1,485) (1,165) Finance lease costs: Amortization of ROU asset expense 11 6 21 12 Interest on finance lease liability 1 — 2 1 Total lease cost $ 2,573 $ 157 $ 4,514 $ 1,095
Summary of supplemental cash flow information related to leases	Supplemental cash flow information related to leases was as follows: Six Months Ended March 31, 2023 2022 Cash flows included in the measurement of lease liabilities: Operating cash flows from operating leases $ 5,491 $ 2,722 Operating cash flows from finance leases 23 1 Financing cash flows from finance leases 2 13 Non-cash lease activity: ROU assets obtained in exchange for new operating lease liabilities $ 14,080 $ 18,091 ROU assets obtained in exchange for new finance lease liabilities — 10
Summary of weighted average remaining lease term and discount rate	The weighted average remaining lease term and discount rate for the Company’s operating and finance leases as of March 31, 2023 and 2022 were: March 31, 2023 March 31, 2022 Weighted-average remaining lease term (in years) Operating lease 5.92 6.11 Finance lease 1.92 2.97 Weighted-average discount rate (in percentages) Operating lease 7.85 % 5.01 % Finance lease 4.86 % 4.86 %
Summary of maturities of operating lease liabilities for each of the following five years and a total thereafter	As of March 31, 2023, maturities of operating and finance lease liabilities for each of the following five fiscal years and a total thereafter were as follows: Operating Leases Finance Leases 2023 (remainder of fiscal year) $ 5,630 $ 22 2024 10,175 34 2025 8,695 14 2026 7,423 5 2027 5,573 1 Thereafter 19,138 — Total minimum future lease payments 56,634 76 Less interest (13,843) (3) Total lease liability 42,791 73

EQUITY, STOCK-BASED COMPENSAT_2

EQUITY, STOCK-BASED COMPENSATION AND LOSS PER SHARE (Tables)	6 Months Ended
	Mar. 31, 2023
EQUITY, STOCK-BASED COMPENSATION AND LOSS PER SHARE
Schedule of computation of basic and diluted net (loss) income per share	The following table reconciles the computation of basic net loss per share to diluted net loss per share: Three Months Ended Six Months Ended March 31, March 31, 2023 2022 2023 2022 Basic and diluted net loss per share: Net loss applicable to common shareholders $ (9,994) $ (6,087) $ (97,317) $ (89,134) Weighted average common shares outstanding (in thousands) Basic and diluted: 25,687 25,315 25,645 23,197 Basic and diluted net loss per share $ (0.39) $ (0.24) $ (3.79) $ (3.84)

DESCRIPTION OF THE BUSINESS A_3

DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION - Narrative (Details)	6 Months Ended
	Mar. 31, 2023 segment
SEGMENT AND GEOGRAPHIC INFORMATION
Number of segments	2

DESCRIPTION OF THE BUSINESS - T

DESCRIPTION OF THE BUSINESS - Temporarily Suspended or Limited Operations (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022	Sep. 30, 2022
REVENUE RECOGNITION
Revenues	$ 151,463	$ 140,313	$ 274,217	$ 224,524	$ 547,656
Cambodian NHP Vendor
REVENUE RECOGNITION
Revenues					$ 140,000

DESCRIPTION OF THE BUSINESS A_4

DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION - Liquidity (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION
Cash and cash equivalents	$ 24,596	$ 18,515

DESCRIPTION OF THE BUSINESS A_5

DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION - Concentration of Risk (Details) - customer	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Cost of revenues \| Vendor concentration risk
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Line Items]
Number of vendors	0	0	0	0
One customer \| Sales revenue \| Customer concentration risk
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Line Items]
Number of Customers	1	1	1	1
Concentration risk percentage	25%	31.40%	23.60%	27.40%

REVENUE FROM CONTRACTS WITH C_3

REVENUE FROM CONTRACTS WITH CUSTOMERS - Contract Assets and Contract Liabilities (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Mar. 31, 2023	Sep. 30, 2022
Contract assets
Trade receivables	$ 65,127	$ 88,867
Unbilled revenue	16,410	17,474
Contract liabilities
Customer deposits	36,761	39,222
Deferred revenue	18,435	29,420
Uncollectible invoices written off	$ 15,419	$ 2,647
Percentage of revenue billed from unbilled revenue	85%
Percentage of contract liabilities recognized as revenue	55%

SEGMENT AND GEOGRAPHIC INFORM_3

SEGMENT AND GEOGRAPHIC INFORMATION - Operating Segments Revenue and Operating Income (Loss) (Details) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Mar. 31, 2023 USD ($)	Mar. 31, 2022 USD ($)	Mar. 31, 2023 USD ($) segment	Mar. 31, 2022 USD ($)	Sep. 30, 2022 USD ($)
SEGMENT INFORMATION
Number of segments \| segment			2
Revenue	$ 151,463	$ 140,313	$ 274,217	$ 224,524	$ 547,656
Operating Income (Loss)	(2,125)	7,868	(92,703)	(25,773)
Interest expense	(10,515)	(7,547)	(20,965)	(12,375)
Other expense (income)	545	(139)	(1,333)	(57,866)
(Loss) income before income taxes	(12,095)	182	(115,001)	(96,014)
Service
SEGMENT INFORMATION
Revenue	58,752	49,584	108,800	87,760
Product
SEGMENT INFORMATION
Revenue	92,711	90,729	165,417	136,764
Intersegment
SEGMENT INFORMATION
Revenue	3,262	1,997	4,387	2,317
Discovery and Safety Assessment Segment (DSA)
SEGMENT INFORMATION
Operating Income (Loss)	1,924	3,752	4,296	9,794
Discovery and Safety Assessment Segment (DSA) \| Service
SEGMENT INFORMATION
Revenue	46,145	38,062	86,116	69,937
Discovery and Safety Assessment Segment (DSA) \| Product
SEGMENT INFORMATION
Revenue	878	992	2,000	1,942
Research Models And Services Segment (RMS)
SEGMENT INFORMATION
Operating Income (Loss)	12,725	22,562	(58,547)	22,642
Research Models And Services Segment (RMS) \| Service
SEGMENT INFORMATION
Revenue	12,607	11,522	22,684	17,823
Research Models And Services Segment (RMS) \| Product
SEGMENT INFORMATION
Revenue	91,833	89,737	163,417	134,822
Unallocated Corporate Segment
SEGMENT INFORMATION
Operating Income (Loss)	$ (16,774)	$ (18,446)	$ (38,452)	$ (58,209)

SEGMENT AND GEOGRAPHIC INFORM_4

SEGMENT AND GEOGRAPHIC INFORMATION - Operating Segments (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
SEGMENT INFORMATION
Depreciation and amortization:	$ 12,990	$ 9,831	$ 26,253	$ 15,866
Capital expenditures:	8,471	9,547	16,840	15,202
Discovery and Safety Assessment Segment (DSA)
SEGMENT INFORMATION
Depreciation and amortization:	3,611	3,414	7,591	5,958
Capital expenditures:	3,970	3,431	7,264	6,417
Research Models And Services Segment (RMS)
SEGMENT INFORMATION
Depreciation and amortization:	9,379	6,417	18,662	9,908
Capital expenditures:	$ 4,501	$ 6,116	$ 9,576	$ 8,785

SEGMENT AND GEOGRAPHIC INFORM_5

SEGMENT AND GEOGRAPHIC INFORMATION - Geographic Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022	Sep. 30, 2022
SEGMENT INFORMATION
Revenues	$ 151,463	$ 140,313	$ 274,217	$ 224,524	$ 547,656
Long-Lived Assets	188,496		188,496		186,199
United States
SEGMENT INFORMATION
Revenues	129,980	117,890	228,989	190,335
Long-Lived Assets	173,540		173,540		173,417
Netherlands
SEGMENT INFORMATION
Revenues	11,522	12,119	26,744	18,655
Long-Lived Assets	6,436		6,436		5,824
Other
SEGMENT INFORMATION
Revenues	9,961	$ 10,304	18,484	$ 15,534
Long-Lived Assets	$ 8,520		$ 8,520		$ 6,958

SEGMENT AND GEOGRAPHIC INFORM_6

SEGMENT AND GEOGRAPHIC INFORMATION (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
SEGMENT AND GEOGRAPHIC INFORMATION
Non-cash amortization of inventory fair value step-up			$ 427	$ 6,277
Goodwill impairment loss	$ 0	$ 0	66,367	0
Stock based compensation expense, non-cash			$ 3,827	$ 20,300

BUSINESS COMBINATIONS - Narrati

BUSINESS COMBINATIONS - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands

3 Months Ended

6 Months Ended

12 Months Ended

Jul. 07, 2022

Apr. 25, 2022

Jan. 27, 2022

Jan. 10, 2022

Dec. 29, 2021

Nov. 05, 2021

Oct. 04, 2021

Mar. 31, 2023

Dec. 31, 2022

Mar. 31, 2022

Dec. 31, 2021

Mar. 31, 2023

Mar. 31, 2022

Sep. 30, 2022

BUSINESS COMBINATIONS

Consideration in cash

$ 0

$ 288,702

Revenue

$ 151,463

$ 140,313

274,217

224,524

$ 547,656

Net loss

(9,994)

$ (87,323)

$ (6,087)

$ (83,047)

$ (97,317)

$ (89,134)

Plato BioPharma Inc

BUSINESS COMBINATIONS

Consideration in cash

$ 10,530

Shares issued

57,587

Common shares value

$ 1,776

Intangible assets

4,800

Plato BioPharma Inc | Promissory Note

BUSINESS COMBINATIONS

Principal amount

$ 3,000

Plato BioPharma Inc | Customer Relationships

BUSINESS COMBINATIONS

Weighted-average estimated useful life

8 years

Envigo RMS Holding Corp

BUSINESS COMBINATIONS

Aggregate consideration paid, including adjustments for net working capital

$ 217,808

Shares issued

8,245,918

Common shares value

$ 439,590

Shares issuable upon the exercise of stock option

790,620

Exercisable weighted-average exercise price (in dollars per share)

$ 9.93

Share Price

$ 44.80

Total value of options

$ 35,418

Value of options excluded from purchase price

18,242

Vested stock options reflected as purchase consideration

17,176

Goodwill deductible for tax purposes

50,428

Net loss

2,222

Unrecognized tax benefit

$ 1,861

Envigo RMS Holding Corp | Customer Relationships

BUSINESS COMBINATIONS

Weighted-average estimated useful life

12 years 6 months

Intangible assets

$ 251,000

Envigo RMS Holding Corp | Intellectual property

BUSINESS COMBINATIONS

Weighted-average estimated useful life

8 years 9 months 18 days

Intangible assets

$ 49,000

Robinson Services, Inc.

BUSINESS COMBINATIONS

Aggregate consideration paid, including adjustments for net working capital

$ 3,250

Shares issued

70,633

Common shares value

$ 2,898

Robinson Services, Inc. | Customer Relationships

BUSINESS COMBINATIONS

Weighted-average estimated useful life

7 years 6 months

Integrated Laboratory Systems, LLC (ILS)

BUSINESS COMBINATIONS

Consideration in cash

$ 38,993

Shares issued

429,118

Common shares value

$ 14,466

Escrowed amount

3,800

Settlement of a preexisting relationship

Intangible assets

$ 22,300

Integrated Laboratory Systems, LLC (ILS) | Customer Relationships

BUSINESS COMBINATIONS

Weighted-average estimated useful life

9 years

Orient BioResource Center, Inc

BUSINESS COMBINATIONS

Consideration in cash

$ 26,522

Shares issued

677,339

Common shares value

$ 18,410

Weighted-average estimated useful life

10 years

Settlement of a preexisting relationship

$ 1,017

Period for payment of consideration

18 months

Liabilities incurred

$ 3,325

Gain or loss on settlement

Intangible assets

13,400

Goodwill deductible for tax purposes

$ 0

Histion LLC Acquisition

BUSINESS COMBINATIONS

Consideration in cash

$ 950

Shares issued

17,618

Common shares value

$ 364

Principal amount

$ 433

Protypia, Inc.

BUSINESS COMBINATIONS

Consideration in cash

$ 9,460

Shares issued

74,997

Common shares value

$ 806

Principal amount

$ 600

Weighted-average estimated useful life

8 years 7 months 6 days

Intangible assets

$ 5,600

Goodwill deductible for tax purposes

$ 0

BUSINESS COMBINATIONS - Fair va

BUSINESS COMBINATIONS - Fair value of assets acquired and liabilities assumed (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Jan. 27, 2022	Jan. 10, 2022	Dec. 29, 2021	Nov. 05, 2021	Oct. 04, 2021
Plato BioPharma Inc
Assets acquired and liabilities assumed:
Cash						$ 1,027
Trade receivables and contract assets						853
Prepaid expenses and other current assets						133
Operating lease right of use ("ROU") asset						2,272
Property and equipment						1,127
Intangible assets						4,800
Goodwill						9,279
Accounts payable						(113)
Accrued expenses						(343)
Deferred tax liabilities						(1,457)
Long-term operating leases, net						(2,272)
Total						$ 15,306
Envigo RMS Holding Corp
Assets acquired and liabilities assumed:
Cash					$ 2,488
Restricted cash					435
Trade receivables and contract assets					43,566
Inventories					40,000
Prepaid expenses and other current assets					17,373
Operating lease right of use ("ROU") asset					13,229
Property and equipment					106,338
Other assets					7,676
Goodwill					282,768
Accounts payable					(25,832)
Accrued expenses					(11,665)
Deferred tax liabilities					(77,291)
Fees invoiced in advance					(7,047)
Current portion on long-term operating lease					(4,371)
Long-term operating leases, net					(8,634)
Other liabilities					(5,339)
Noncontrolling interest					880
Total					674,574
Envigo RMS Holding Corp \| Customer Relationships
Assets acquired and liabilities assumed:
Intangible assets					251,000
Envigo RMS Holding Corp \| Intellectual property
Assets acquired and liabilities assumed:
Intangible assets					$ 49,000
Robinson Services, Inc.
Assets acquired and liabilities assumed:
Customer relationship				$ 4,700
Non-complete agreement				300
Supply agreement				200
Goodwill				948
Total				$ 6,148
Integrated Laboratory Systems, LLC (ILS)
Assets acquired and liabilities assumed:
Cash			$ 797
Trade receivables and contract assets			4,730
Operating lease right of use ("ROU") asset			4,994
Property and equipment			4,436
Intangible assets			22,300
Goodwill			25,283
Accounts payable			(1,165)
Accrued expenses			(905)
Fees invoiced in advance			(2,472)
Long-term operating leases, net			(4,554)
Total			$ 53,444
Orient BioResource Center, Inc
Assets acquired and liabilities assumed:
Cash		$ 5,481
Trade receivables and contract assets		2,025
Inventories		9,400
Prepaid expenses and other current assets		2,609
Property and equipment		8,336
Intangible assets		13,400
Goodwill		18,624
Accounts payable		(552)
Accrued expenses		(285)
Deferred tax liabilities		(3,216)
Fees invoiced in advance		(6,548)
Total		$ 49,274
Protypia, Inc.
Assets acquired and liabilities assumed:
Intangible assets	$ 5,600
Goodwill	6,002
Deferred tax liabilities	(652)
Other liabilities	(84)
Total	$ 10,866

BUSINESS COMBINATIONS - Previou

BUSINESS COMBINATIONS - Previously Vested Stock Options (Details) - Envigo RMS Holding Corp	Nov. 05, 2021 $ / shares
Principal assumptions
Stock price	$ 53.31
Strike price	$ 9.93
Volatility	75.93%
Expected term	3 years 18 days
Risk-free rate	0.62%

BUSINESS COMBINATIONS - Unaudit

BUSINESS COMBINATIONS - Unaudited pro forma (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Mar. 31, 2022	Mar. 31, 2022
BUSINESS COMBINATIONS
Total revenues	$ 144,027	$ 269,721
Net (loss) income	$ (71,731)	$ (98,475)

GOODWILL AND INTANGIBLE ASSET_2

GOODWILL AND INTANGIBLE ASSETS - Goodwill (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022	Sep. 30, 2022
Goodwill
Gross Carrying Amount	$ 396,658		$ 396,658		$ 393,830
Acquisition during the period			2,828
Goodwill impairment	0	$ 0	(66,367)	$ 0
Goodwill	94,286		94,286		157,825
DSA
Goodwill
Gross Carrying Amount	94,286		94,286		91,458
Acquisition during the period			2,828
RMS
Goodwill
Gross Carrying Amount	302,372		302,372		302,372
Goodwill impairment			(66,367)
Accumulated impairment loss	$ (302,372)		$ (302,372)		$ (236,005)

GOODWILL AND INTANGIBLE ASSET_3

GOODWILL AND INTANGIBLE ASSETS - Intangible Assets, net by major class (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
Finite-Lived intangible assets
Carrying Amount, Gross	$ 378,458	$ 380,699
Accumulated Amortization	(52,197)	(34,813)
Totals	326,261	345,886
Customer relationships
Finite-Lived intangible assets
Carrying Amount, Gross	317,061	318,896
Accumulated Amortization	(40,821)	(26,990)
Totals	276,240	291,906
Intellectual property
Finite-Lived intangible assets
Carrying Amount, Gross	56,591	56,997
Accumulated Amortization	(9,037)	(5,767)
Totals	47,554	51,230
Non-compete agreements
Finite-Lived intangible assets
Carrying Amount, Gross	2,410	2,410
Accumulated Amortization	(1,100)	(872)
Totals	1,310	1,538
Other
Finite-Lived intangible assets
Carrying Amount, Gross	2,396	2,396
Accumulated Amortization	(1,239)	(1,184)
Totals	$ 1,157	$ 1,212

DEBT (Details)

3 Months Ended

6 Months Ended

Jan. 09, 2023 USD ($)

Dec. 29, 2022 D

Jan. 27, 2022 USD ($)

Jan. 07, 2022 USD ($)

Nov. 27, 2021 USD ($) $ / shares

Nov. 05, 2021 USD ($)

Nov. 04, 2021 USD ($)

Mar. 31, 2023 USD ($)

Mar. 31, 2022 USD ($)

Mar. 31, 2023 USD ($) D

Mar. 31, 2022 USD ($)

Sep. 30, 2022 USD ($)

Jul. 07, 2022 USD ($)

Oct. 04, 2021 USD ($)

DEBT

Revolving credit facility

$ 0

$ 15,000,000

Loss on debt extinguishment

$ 878,000

Borrowings on delayed draw term loan

35,000,000

Repayment of revolving credit facility

21,000,000

10,000,000

Long-term debt

387,058,000

350,655,000

Unamortized debt issuance costs

4,620,000

5,060,000

Interest expense

2,740,000

$ 2,603,000

5,504,000

5,230,000

Coupon interest expense

1,138,000

2,300,000

Accretion expense

1,383,000

1,257,000

2,764,000

2,512,000

Amortization of debt discount and issuance costs

$ 219,000

$ 208,000

$ 440,000

418,000

Minimum | SOFR

DEBT

Variable interest rate (as a percent)

0.11448%

Credit Agreement

DEBT

Loss on debt extinguishment

877,000

Credit Agreement | LIBOR

DEBT

Basis points adjustments (as percentage)

6.25%

Credit Agreement | Prime Rate

DEBT

Basis points adjustments (as percentage)

5.25%

Credit Agreement | Maximum | Prime Rate

DEBT

Basis points adjustments (as percentage)

5.50%

Credit Agreement | Minimum

DEBT

Variable interest rate (as a percent)

Credit Agreement | Minimum | Prime Rate

DEBT

Basis points adjustments (as percentage)

Term Loan

DEBT

Maximum amount of line of credit

$ 40,000,000

$ 165,000,000

Delayed Draw Term Loan

DEBT

Maximum amount of line of credit

$ 35,000,000

Maximum term for drawing loan facility

18 months

Effective rate (as percentage)

10.45%

10.35%

Commitment fee (as percentage)

Borrowings on delayed draw term loan

$ 35,000,000

Delayed Draw Term Loan | LIBOR

DEBT

Basis points adjustments (as percentage)

6.25%

Delayed Draw Term Loan | Maximum

DEBT

Basis points adjustments (as percentage)

6.50%

Delayed Draw Term Loan | Maximum | LIBOR

DEBT

Basis points adjustments (as percentage)

6.50%

Delayed Draw Term Loan | Minimum

DEBT

Basis points adjustments (as percentage)

Delayed Draw Term Loan | Minimum | LIBOR

DEBT

Basis points adjustments (as percentage)

Credit Facility Term Loan and Delayed Draw Term Loan

DEBT

Annual principal payments (as percentage)

Revolving Facility

DEBT

Revolving credit facility

$ 0

15,000,000

Principal amount of revolving loan facility

$ 15,000,000

Commitment fee (as percentage)

0.50%

Repayment of revolving credit facility

15,000,000

New Delayed Draw Term Loan

DEBT

Maximum amount of line of credit

$ 35,000,000

Maximum term for drawing loan facility

24 months

Borrowings on delayed draw term loan

$ 35,000,000

Additional Term Loans

DEBT

Effective rate (as percentage)

10.40%

10.32%

Annual principal payments (as percentage)

Additional Term Loans | LIBOR

DEBT

Basis points adjustments (as percentage)

6.25%

Additional Term Loans | Maximum | LIBOR

DEBT

Basis points adjustments (as percentage)

6.50%

Additional Term Loans | Minimum | LIBOR

DEBT

Basis points adjustments (as percentage)

Line Of Credit Facility, Initial Leverage Ratio | Credit Agreement

DEBT

Threshold secured leverage ratio

4.25

Line Of Credit Facility, Leverage Ratio To Be Maintained Beginning Quarter Ending September 30, 2023 | Credit Agreement

DEBT

Threshold secured leverage ratio

3.75

Line Of Credit Facility, Leverage Ratio To Be Maintained Beginning Quarter Ending March 31, 2025 | Credit Agreement

DEBT

Threshold secured leverage ratio

Line Of Credit Facility, Minimum Fixed Charge Coverage Ratio To Be Maintained During First Anniversary | Credit Agreement

DEBT

Threshold secured leverage ratio

Line Of Credit Facility, Minimum Fixed Charge Coverage Ratio To Be Maintained From And After First Anniversary | Credit Agreement

DEBT

Threshold secured leverage ratio

1.10

First Amendment to Credit Agreement | Delayed Draw Term Loan

DEBT

Effective rate (as percentage)

10.68%

11.07%

Second Amendment To Credit Agreement | Maximum | SOFR

DEBT

Variable interest rate (as a percent)

0.42826%

Second Amendment To Credit Agreement | Minimum | SOFR

DEBT

Variable interest rate (as a percent)

Second Amendment To Credit Agreement | Credit Agreement

DEBT

Basis points adjustments (as percentage)

0.50%

Number of days after end of each months within which company needs to provide unaudited consolidated financial statements | D

Number of business days within which company need to provide cash flow forecast | D

Duration for which periodic cash flow forecast is prepared

91 days

Term following the date of amendment permitted to financial advisor to conduct meet under the amended credit agreement

6 months

Second Amendment To Credit Agreement | Credit Agreement | Base Rate

DEBT

Basis points adjustments (as percentage)

Second Amendment To Credit Agreement | Credit Agreement | Maximum | Base Rate

DEBT

Basis points adjustments (as percentage)

5.50%

Second Amendment To Credit Agreement | Credit Agreement | Maximum | SOFR

DEBT

Basis points adjustments (as percentage)

6.50%

Second Amendment To Credit Agreement | Credit Agreement | Minimum | Base Rate

DEBT

Basis points adjustments (as percentage)

Variable interest rate (as a percent)

Second Amendment To Credit Agreement | Credit Agreement | Minimum | SOFR

DEBT

Basis points adjustments (as percentage)

Variable interest rate (as a percent)

0.11448%

Third Amendment To Credit Agreement

DEBT

Cash and cash equivalents held on hand domestically

$ 10,000,000

Consideration to be paid-in-kind (as a percent)

0.50%

Consideration to be paid in cash upon prepayments (as a percent)

0.50%

Consideration to be paid in cash upon permanent reductions (as a percent)

Third Amendment To Credit Agreement | Minimum | SOFR

DEBT

Variable interest rate (as a percent)

Third Amendment To Credit Agreement | Credit Agreement

DEBT

Basis points adjustments (as percentage)

0.50%

Third Amendment To Credit Agreement | Credit Agreement | Base Rate

DEBT

Basis points adjustments (as percentage)

Third Amendment To Credit Agreement | Credit Agreement | Maximum | Base Rate

DEBT

Basis points adjustments (as percentage)

8.50%

Third Amendment To Credit Agreement | Credit Agreement | Maximum | SOFR

DEBT

Basis points adjustments (as percentage)

9.50%

Variable interest rate (as a percent)

0.42826%

Third Amendment To Credit Agreement | Credit Agreement | Minimum | Base Rate

DEBT

Basis points adjustments (as percentage)

5.75%

Variable interest rate (as a percent)

Third Amendment To Credit Agreement | Credit Agreement | Minimum | SOFR

DEBT

Basis points adjustments (as percentage)

6.75%

Seller Note - Plato BioPharma

DEBT

Long-term debt

$ 214,000

1,470,000

Seller Note - Plato BioPharma | Unsecured promissory note

DEBT

Principal amount

$ 3,000,000

Interest Rate (as a percent)

4.50%

Seller Payable Orient Bio Resource Center

DEBT

Long-term debt

3,594,000

3,488,000

Seller Payable Orient Bio Resource Center | Unsecured promissory note

DEBT

Principal amount

$ 3,700,000

Fair value of debt

$ 3,325,000

Period for payment of consideration

18 months

Seller Note - Histion

DEBT

Long-term debt

301,000

369,000

Seller Note - Histion | Unsecured promissory note

DEBT

Principal amount

$ 433,000

Interest Rate (as a percent)

4.50%

Seller Note - Protypia

DEBT

Long-term debt

600,000

Seller Note - Protypia | Unsecured promissory note

DEBT

Principal amount

$ 600,000

Interest Rate (as a percent)

4.50%

Convertible Senior Notes

DEBT

Principal amount

$ 140,000

Interest Rate (as a percent)

3.25%

Settlement period

13 days

Additional principal amount

$ 15,000,000

Long-term debt

107,729,000

$ 107,729,000

104,965,000

Initial conversion rate

21.7162

Initial conversion price | $ / shares

$ 46.05

Number of scheduled trading days | D

Conversion price

130%

Number of trading days

Number of consecutive trading days

Cure period

30 days

Cure or waiver period

60 days

Guarantor or subsidiaries for the payment

$ 20,000,000

Period for discharge or stay

60 days

Percentage of noteholders

25%

Right to receive special interest maximum term

180 days

Right to receive special interest maximum rate

0.50%

Convertible Senior Notes | Other Income (loss)

DEBT

Gain (loss) on fair value remeasurement

$ 56,714,000

Convertible Senior Notes | ASU 2020-06

DEBT

Fair value remeasurement of embedded derivative

$ 88,576,000

EIDL Loan

DEBT

Long-term debt

$ 140,000

DEBT - Schedule of long-term de

DEBT - Schedule of long-term debt (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
DEBT
Long-term debt	$ 387,058	$ 350,655
Less: Current portion	(4,023)	(7,979)
Less: Debt issue costs not amortized	(12,995)	(11,999)
Total Long-term debt	370,040	330,677
Long-term debt, Carrying value	387,058	350,655
Seller Note - Bolder BioPATH
DEBT
Long-term debt	714	808
Long-term debt, Carrying value	714	808
Seller Note - Pre-Clinical Research Services
DEBT
Long-term debt	578	615
Long-term debt, Carrying value	578	615
Seller Note - Plato BioPharma
DEBT
Long-term debt	214	1,470
Long-term debt, Carrying value	214	1,470
Seller Payable Orient Bio Resource Center
DEBT
Long-term debt	3,594	3,488
Long-term debt, Carrying value	3,594	3,488
Seller Note - Histion
DEBT
Long-term debt	301	369
Long-term debt, Carrying value	301	369
Seller Note - Protypia
DEBT
Long-term debt	600	600
Long-term debt, Carrying value	600	600
EIDL Loan
DEBT
Long-term debt	140	140
Long-term debt, Carrying value	140	140
Convertible Senior Notes
DEBT
Long-term debt	107,729	104,965
Long-term debt, Carrying value	107,729	104,965
Term Loan Facility, Initial DDTL and Incremental Term Loans
DEBT
Long-term debt	273,188	238,200
Long-term debt, Carrying value	$ 273,188	$ 238,200

SUPPLEMENTAL BALANCE SHEET IN_3

SUPPLEMENTAL BALANCE SHEET INFORMATION - Trade Receivables (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
Trade receivables and contract assets
Trade receivables	$ 65,127	$ 88,867
Unbilled revenue	16,410	17,474
Total	81,537	106,341
Less: Allowance for credit losses	(7,523)	(6,268)
Trade receivables and contract assets, net of allowances for credit losses	$ 74,014	$ 100,073

SUPPLEMENTAL BALANCE SHEET IN_4

SUPPLEMENTAL BALANCE SHEET INFORMATION - Inventories (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
Inventories
Raw materials	$ 2,106	$ 1,757
Work in progress	131	186
Finished goods	4,947	4,933
Research Model Inventory	60,617	68,055
Total	67,801	74,931
Less: Obsolescence reserve	(3,515)	(3,490)
Inventories, net	$ 64,286	$ 71,441

SUPPLEMENTAL BALANCE SHEET IN_5

SUPPLEMENTAL BALANCE SHEET INFORMATION - Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
Prepaid expenses and other current assets
Advances to suppliers	$ 29,195	$ 30,292
Income tax receivable	1,943	366
Prepaid research models	2,812	3,575
Other	6,529	8,250
Prepaid expenses and other current assets	$ 40,479	$ 42,483

SUPPLEMENTAL BALANCE SHEET IN_6

SUPPLEMENTAL BALANCE SHEET INFORMATION - Composition of Other Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
Other assets
Long-term advances to suppliers	$ 2,250	$ 2,894
Finance lease right-of-use assets, net	65	79
Debt issuance costs - revolving credit facility	384	1,411
Funded status of defined benefit plan	2,507	1,573
Other	1,758	1,567
Other assets	$ 6,964	$ 7,524

SUPPLEMENTAL BALANCE SHEET IN_7

SUPPLEMENTAL BALANCE SHEET INFORMATION - Accrued Expenses (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
Accrued expenses
Accrued compensation	$ 11,296	$ 17,460
Non-income taxes	2,358	1,200
Accrued interest	5,318	5,228
Other	5,657	7,547
Accrued professional fees	6,329	4,366
Accrued expenses and other liabilities	$ 30,958	$ 35,801

SUPPLEMENTAL BALANCE SHEET IN_8

SUPPLEMENTAL BALANCE SHEET INFORMATION - Fees Invoiced in Advance (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
Fees invoiced in advance
Customer deposits	$ 36,761	$ 39,222
Deferred revenue	18,435	29,420
Fees invoiced in advance	$ 55,196	$ 68,642

DEFINED BENEFIT PLAN - Narrativ

DEFINED BENEFIT PLAN - Narrative (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Mar. 31, 2023	Sep. 30, 2022
DEFINED BENEFIT PLAN
Contributions to the plan	$ 1,237
Funded status of defined benefit plan		$ 2,507	$ 1,573

DEFINED BENEFIT PLAN - Net peri

DEFINED BENEFIT PLAN - Net periodic benefit costs (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Components of net periodic (benefit) expense:
Interest cost	$ 182	$ 79	$ 364	$ 137
Expected return on assets	(198)	(220)	(396)	(329)
Amortization of prior (gain) loss	(37)	116	(75)	277
Net periodic (benefit) expense	$ (53)	$ (25)	$ (107)	$ 85
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) Excluding Service Cost, Statement of Income or Comprehensive Income [Extensible Enumeration]	General and Administrative Expense	General and Administrative Expense	General and Administrative Expense	General and Administrative Expense

OTHER OPERATING EXPENSE (Detail

OTHER OPERATING EXPENSE (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
OTHER OPERATING EXPENSE (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
OTHER OPERATING EXPENSE
Acquisition and integration costs	$ 105	$ 2,085	$ 1,088	$ 10,893
Restructuring costs	1,740		2,006
Start up costs	2,281	1,474	3,786	2,431
Remediation costs	555	507	1,140	946
Other costs	131	384	431	746
Acquisition-related stock compensation costs				23,014
Total	$ 4,812	$ 4,450	$ 8,451	$ 38,030

RESTRUCTURING AND ASSETS HELD_3

RESTRUCTURING AND ASSETS HELD FOR SALE - Restructuring (Details) - Site Optimization Plan $ in Thousands	6 Months Ended
	Mar. 31, 2023 USD ($)
RESTRUCTURING
Liability balance for restructuring costs	$ 503
Research Models And Services Segment (RMS)
RESTRUCTURING
Impairment charges	$ 678

RESTRUCTURING AND ASSETS HELD_4

RESTRUCTURING AND ASSETS HELD FOR SALE - Assets Held for Sale (Details) - Israeli Businesses - Assets held for sale - USD ($) $ in Thousands		3 Months Ended	6 Months Ended
	Oct. 06, 2021	Mar. 31, 2023	Mar. 31, 2023
Assets held for sale
Amount considered for sale of ownership interest	$ 6,650
Income (loss) before taxes		$ 810	$ (1,094)
Current assets:
Cash and cash equivalents		1,058	1,058
Restricted cash		465	465
Trade receivables and contract assets, net of allowances for credit losses		2,462	2,462
Inventories, net		822	822
Prepaid expenses and other current assets		843	843
Total current assets		5,650	5,650
Property and equipment, net		1,620	1,620
Total assets		7,270	7,270
Current liabilities:
Accounts payable		299	299
Accrued expenses and other liabilities		1,478	1,478
Fees invoiced in advance		324	324
Total liabilities		2,101	2,101
Net assets held for sale		$ 5,169	$ 5,169
Israel RMS
Assets held for sale
Percentage of interest sold	100%
Israel CRS
Assets held for sale
Percentage of interest held	37.50%
Israel CRS \| Israel RMS
Assets held for sale
Percentage of interest sold	62.50%

LEASES (Details)

LEASES (Details)	6 Months Ended
LEASES (Details)	Mar. 31, 2023
LEASES
Renewal option, operating lease	true
Renewal option, finance lease	true
Facilities leases \| Minimum
LEASES
Lease term, operating lease	2 years
Lease term, finance lease	2 years
Facilities leases \| Maximum
LEASES
Lease term, operating lease	10 years
Lease term, finance lease	10 years
Equipment leases \| Minimum
LEASES
Lease term, operating lease	30 months
Lease term, finance lease	30 months
Equipment leases \| Maximum
LEASES
Lease term, operating lease	60 months
Lease term, finance lease	60 months

LEASES - Right-of-use lease ass

LEASES - Right-of-use lease assets and lease liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
Right-of-use lease assets and lease liabilities
Operating ROU assets, net	$ 42,014	$ 32,489
Current portion of operating lease liabilities	10,061	7,982
Long-term operating lease liabilities	32,730	24,854
Total operating lease liabilities	42,791	32,836
Finance ROU assets, net	$ 65	$ 79
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration]	Other Assets, Noncurrent	Other Assets, Noncurrent
Current portion of long-term finance lease	$ 39	$ 43
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration]	Accrued Liabilities, Current	Accrued Liabilities, Current
Long-term finance lease liabilities	$ 34	$ 41
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration]	Other Liabilities, Noncurrent	Other Liabilities, Noncurrent
Total finance lease liabilities	$ 73	$ 84

LEASES - Components of lease ex

LEASES - Components of lease expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Operating lease costs:
Fixed operating lease costs	$ 3,322	$ 1,120	$ 5,914	$ 2,203
Short-term lease costs	50	19	62	44
Lease income	(811)	(988)	(1,485)	(1,165)
Finance lease costs:
Amortization of ROU asset expense	11	6	21	12
Interest on finance lease liability	1		2	1
Total lease cost	$ 2,573	$ 157	$ 4,514	$ 1,095

LEASES - Operating and Finance

LEASES - Operating and Finance leases (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023 USD ($)	Mar. 31, 2022 USD ($)	Mar. 31, 2023 USD ($) facility	Mar. 31, 2022 USD ($)
LEASES
Amortization of operating leases \| $	$ 2,466	$ 1,486	$ 4,401	$ 2,568
Number of facilities the Company serves as a lessor to a lessee \| facility			5

LEASES - Supplemental cash flow

LEASES - Supplemental cash flow information (Details) - USD ($) $ in Thousands	6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash flows included in the measurement of lease liabilities:
Operating cash flows from operating leases	$ 5,491	$ 2,722
Operating cash flows from finance leases	23	1
Finance cash flows from finance leases	2	13
Non-cash lease activity:
ROU assets obtained in exchange for new operating lease liabilities	$ 14,080	18,091
Right-of-use assets obtained in exchange for new finance lease liabilities		$ 10

LEASES - Weighted average remai

LEASES - Weighted average remaining lease term and discount rate (Details)	Mar. 31, 2023	Mar. 31, 2022
LEASES
Operating lease, Weighted-average remaining lease term (in years)	5 years 11 months 1 day	6 years 1 month 9 days
Finance lease, Weighted-average remaining lease term (in years)	1 year 11 months 1 day	2 years 11 months 19 days
Operating lease, Weighted-average discount rate (as a percent)	7.85%	5.01%
Finance lease, Weighted-average discount rate (as a percent)	4.86%	4.86%

LEASES - Maturities of operatin

LEASES - Maturities of operating and finance lease (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
Maturities of operating lease liabilities
2023 (remainder of fiscal year)	$ 5,630
2024	10,175
2025	8,695
2026	7,423
2027	5,573
Thereafter	19,138
Total minimum future lease payments	56,634
Less interest	(13,843)
Total operating lease liabilities	42,791	$ 32,836
Maturities of finance lease liabilities
2023 (remainder of fiscal year)	22
2024	34
2025	14
2026	5
2027	1
Total minimum future lease payments	76
Less interest	(3)
Total finance lease liabilities	$ 73	$ 84

EQUITY, STOCK-BASED COMPENSAT_3

EQUITY, STOCK-BASED COMPENSATION AND LOSS PER SHARE (Details) - USD ($) $ in Thousands			3 Months Ended		6 Months Ended
	Nov. 04, 2021	Sep. 27, 2021	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022	Sep. 30, 2022	Nov. 03, 2021
STOCKHOLDERS EQUITY AND (LOSS) INCOME PER SHARE
Common and preferred shares authorized	75,000,000							20,000,000
Common Stock, Shares Authorized	74,000,000		74,000,000		74,000,000		74,000,000	19,000,000
Preferred Stock, Shares Authorized	1,000,000							1,000,000
Number of shares added under amended and restated plan	1,500,000
Stock issued in acquisitions (In shares)			0	1,106,457	0	9,480,595
Stock based compensation expense			$ 1,781	$ 1,138	$ 3,827	$ 25,070
Employee stock options
STOCKHOLDERS EQUITY AND (LOSS) INCOME PER SHARE
Shares excluded in computing diluted (loss)				1,695,070	1,797,189
Shares issuable upon conversion		3,040,268
Restricted stock units
STOCKHOLDERS EQUITY AND (LOSS) INCOME PER SHARE
Shares excluded in computing diluted (loss)					803,972	682,357
2021 Equity Incentive Plan
STOCKHOLDERS EQUITY AND (LOSS) INCOME PER SHARE
Number of shares remained available for grants			502,685		502,685
Envigo equity plan
STOCKHOLDERS EQUITY AND (LOSS) INCOME PER SHARE
Post-combination expense recognized in connection acquisition inclusive of cash					$ 4,772
Stock based compensation expense					$ 23,014

EQUITY, STOCK-BASED COMPENSAT_4

EQUITY, STOCK-BASED COMPENSATION AND LOSS PER SHARE - Basic and diluted net loss per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended				6 Months Ended
	Mar. 31, 2023	Dec. 31, 2022	Mar. 31, 2022	Dec. 31, 2021	Mar. 31, 2023	Mar. 31, 2022
EQUITY, STOCK-BASED COMPENSATION AND LOSS PER SHARE
Net loss	$ (9,994)	$ (87,323)	$ (6,087)	$ (83,047)	$ (97,317)	$ (89,134)
Weighted average common shares outstanding, basic (in thousands) (in shares)	25,687		25,315		25,645	23,197
Weighted average common shares outstanding, diluted (in thousands) (in shares)	25,687		25,315		25,645	23,197
Basic net loss per share (in dollars per share)	$ (0.39)		$ (0.24)		$ (3.79)	$ (3.84)
Diluted net loss per share (in dollar per share)	$ (0.39)		$ (0.24)		$ (3.79)	$ (3.84)

INCOME TAXES - Narrative (Detai

INCOME TAXES - Narrative (Details)	3 Months Ended		6 Months Ended
INCOME TAXES - Narrative (Details)	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Income Taxes Quarterly Disclosure
Effective income tax rate (as a percent)	20.40%	3,761.50%	16%	6.20%
Income tax examination period			3 years
Maximum
Income Taxes Quarterly Disclosure
Income tax examination period			5 years
Minimum
Income Taxes Quarterly Disclosure
Income tax examination period			3 years

SUBSEQUENT EVENTS (Details)

SUBSEQUENT EVENTS (Details)	Apr. 04, 2023
Subsequent events \| Seller Payable Orient Bio Resource Center
SUBSEQUENT EVENTS
Maturity extension term (in years)	1 year