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MAXCYTE, INC.

MAXCYTE, INC.MXCTEarnings & Financial Report

Nasdaq · Industrials · Services-Commercial Physical & Biological Research

MaxCyte Inc. is a global biotechnology company focused on developing cell engineering platforms and enabling technologies for cell and gene therapy advancement. Its proprietary non-viral cell modification systems are widely used by pharmaceutical, biotech and life science research entities to develop immunotherapies, gene-edited treatments and next-generation biologic drugs from preclinical research through commercialization.

What changed in MAXCYTE, INC.'s 10-K — 2023 vs 2024

Top changes in MAXCYTE, INC.'s 2024 10-K

446 paragraphs added · 462 removed · 388 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

93 edited+16 added−8 removed102 unchanged
The activities of sponsors, applicants and manufacturers are subject to regulation of those jurisdictions where the research or manufacturing occur, and also jurisdictions for which applications are planned or have been made and the product is intended to be marketed.
The activities of sponsors, applicants, and manufacturers are subject to regulation of those jurisdictions where the research or manufacturing occur, and also those jurisdictions for which applications are planned or have been made, and the product is intended to be marketed.
Our STx instrument has high efficiency and can rapidly transfect from 75,000 to 20 billion cells. When combined with flexible media strategies, the STx allows for substantial improvement in yields of high-quality, transiently expressed proteins while enabling reduced media costs. Another key application area for the STx is expression of therapeutic targets for cell-based assays.
Our STx instrument has high efficiency and can rapidly transfect from 75,000 to 20 billion cells. When combined with flexible cell culture strategies, the STx allows for substantial improvement in yields of high-quality, transiently expressed proteins while enabling reduced media costs. Another key application area for the STx is expression of therapeutic targets for cell-based assays.
By incorporating the Flow Electroporation technology, larger volumes of up to 20 billion cells can be electroporated within 15 to 20 minutes. With a processing potential that ranges from 75,000 to 20 billion cells on a cGMP, 21 CFR Part 11 compatible system, the GTx represents a platform for clinical electroporation at large scale.
By incorporating the Flow Electroporation technology, larger volumes of up to 20 billion cells can be electroporated within 20 minutes. With a processing potential that ranges from 75,000 to 20 billion cells on a cGMP, 21 CFR Part 11 compatible system, the GTx represents a platform for clinical electroporation at large scale.
Research licenses under a stand-alone research license agreement, as well as instruments purchased for research use, could represent opportunities for future SPL partnerships. Clinical Licenses Clinical licenses are agreements with academic institutions or commercial entities that provide access to the use of our instruments for the clinical evaluation and development of a therapeutic product intended for human use.
Research licenses under a stand-alone research license agreement, as well as instruments purchased for research use, could represent opportunities for future SPL agreements. Clinical Licenses Clinical licenses are agreements with academic institutions or commercial entities that provide access to the use of our instruments for the clinical evaluation and development of a therapeutic product intended for human use.
In this way, the regulatory body may review information on our platform in the context of its utilization by our partners in regulated products, for example, as described in our customers’ INDs or BLAs. We continuously update the Master and Technical Files in order to support the regulatory activities of our customers.
In this way, the regulatory body may review information on our platform in the context of its utilization by our customers in regulated products, for example, as described in our customers’ INDs or BLAs. We continuously update the Master and Technical Files in order to support the regulatory activities of our customers.
Our ExPERT system uses two PA designs — a static cuvette used for smaller cell volumes (from 75,000 cells up to 200 million cells) and a cartridge design that is used for both static and Flow Electroporation for larger cell volumes (700 million up to tens of billions of cells).
Our ExPERT system uses two classes of PA designs — a static cuvette used for smaller cell volumes (from 75,000 cells up to 200 million cells) and a cartridge design that is used for both static and Flow Electroporation for larger cell volumes (700 million up to tens of billions of cells).
Our SPL partners also commit to pay precommercial milestone payments for each therapeutic licensed under the agreement and produced using our platform, to be paid as they achieve key precommercial clinical development events (including, for example, Investigational New Drug (“IND”) applications and approvals, filing, dosing of an agreed number of patients in a Phase 1 clinical trial, initiating a pivotal clinical trial, and Biologics License applications (“BLA”) approvals in specified regions).
Our SPL customers also commit to pay precommercial milestone payments for each therapeutic licensed under the agreement and produced using our platform, to be paid as they achieve key precommercial clinical development events (including, for example, Investigational New Drug (“IND”) applications and approvals, filing, dosing of an agreed number of patients in a Phase 1 clinical trial, initiating a pivotal clinical trial, and Biologics License applications (“BLA”) approvals in specified regions).
Our biopharmaceutical and life sciences customers are subject to extensive regulations by the FDA and similar federal, state, and local authorities, as well as their foreign equivalents, regarding the conduct of preclinical studies and clinical trials, in the manufacture of product candidates and products for use in humans (i.e., “Good Manufacturing Practice” laws and regulations) and the marketing authorization and commercialization of biological and drug products.
Our biopharmaceutical and life sciences customers are subject to extensive regulations by the FDA and similar federal, state, and local authorities, as well as their foreign equivalents, regarding the conduct of preclinical studies and clinical trials, in the manufacture of product candidates and products for use in humans (i.e., “Good Manufacturing Practices” laws and regulations) and the marketing authorization and commercialization of biological and drug products.
We have entered into many research licenses to-date, either as (i) instrument sales, (ii) stand-alone research license agreements, (iii) research and clinical license agreements that do not have associated commercial rights, or (iv) under an SPL partnership, which allows a customer to use the instrument for clinical development and potential commercial sale of a therapeutic product.
We have entered into many research licenses to-date, either as (i) instrument sales, (ii) stand-alone research license agreements, (iii) research and clinical license agreements that do not have associated commercial rights, or (iv) under an SPL agreement, which allows a customer to use the instrument for clinical development and potential commercial sale of a therapeutic product.
Our long-term internal engineering expertise is supplemented by our customer focused approach—with a growing application scientist team working with our customers across increasingly diverse applications. • Capitalizing on the large and growing next-generation cell therapy market with the ability to take advantage of rising demand for non-viral approaches.
Our long-term internal engineering expertise is supplemented by our customer focused approach—with an application scientist team working with our customers across increasingly diverse applications. • Capitalizing on the large and growing next-generation cell therapy market with the ability to take advantage of rising demand for non-viral approaches.
VLx provides the capability for large-scall cell engineering and drug discovery applications. The STx is not covered by our FDA Master File or our Technical Files. We believe these systems will also be supportive of the commercial marketing of our partners’ therapeutic products which we enable.
VLx provides the capability for large-scall cell engineering and drug discovery applications. The STx is not covered by our FDA Master File or our Technical Files. We believe these systems will also be supportive of the commercial marketing of our customers’ therapeutic products which we enable.
Our PAs are capable of electroporating cell volumes from small to large scale, in single and multi-well formats, for both research and 18 Table of Contents clinical use. Cells are placed into the sample bag in large scale PAs, or into the well or wells in small scale PAs, and the PA is then connected to the instrument for processing.
Our PAs are capable of electroporating cell volumes from small to large scale, in single and multi-well formats, for both research and 19 Table of Contents clinical use. Cells are placed into the sample bag in large scale PAs, or into the well or wells in small scale PAs, and the PA is then connected to the instrument for processing.
Given growth in the cell therapy pipeline and increased investment in the space, we estimate that the number of potential SPL partnerships for us will continue to grow significantly, based on our estimates of growth in the cell therapy pipeline, growth in the number of therapeutic delivery entrants into the market and ongoing shift in the industry to non-viral delivery.
Given growth in the cell therapy pipeline and increased investment in the space, we estimate that the number of potential SPL customers for us will continue to grow significantly, based on our estimates of growth in the cell therapy pipeline, growth in the number of therapeutic delivery entrants into the market and ongoing shift in the industry to non-viral delivery.
By providing applications for cell-based assays, the STx offers a unique opportunity to apply our technology. ​ ​ 17 Table of Contents ​ ExPERT GTx: Flow Electroporation for large scale transfection in therapeutic applications ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The ExPERT GTx incorporates our proprietary Flow Electroporation technology for use in the cGMP manufacturing of cellular therapies with clinical uses.
By providing applications for cell-based assays, the STx offers a unique opportunity to apply our technology. ​ ​ 18 Table of Contents ​ ExPERT GTx: Flow Electroporation for large scale transfection in therapeutic applications ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The ExPERT GTx incorporates our proprietary Flow Electroporation technology for use in the cGMP manufacturing of cellular therapies with clinical uses.
We expect to continue to grow our market share given the high performance of our platform and the ongoing adoption of non-viral delivery methods as the cell and gene therapy industry has trended towards developing advanced cell-based therapies with complex engineering strategies to improve efficacy, reduce time to patient treatment and expand into new indications. ​ • Innovative partnership business model focused on value creation and shared success .
We expect to continue to grow our market share given the high performance of our platform and the ongoing adoption of non-viral delivery methods as the cell and gene therapy industry has trended towards developing advanced cell-based therapies with complex engineering strategies to improve efficacy, reduce time to patient treatment and expand into new indications. ​ • Innovative SPL agreement business model focused on value creation and shared success .
Our portfolio protects our core technology, the Flow Electroporation® process, the processing assemblies and consumables, control and process elements, and application methods of using our non-viral delivery platform. The protection over our instruments and related methods is estimated to last through at least 2028 and through 2034 for our electroporation applications.
Our portfolio protects our core technology, the Flow Electroporation process, the processing assemblies and consumables, control and process elements, and application methods of using our non-viral delivery platform. The protection over our instruments and related methods is estimated to last through at least 2028 and through 2037 for our electroporation applications.
Violations of these laws by our customers who are subject thereto can lead to significant administrative, civil and criminal penalties, including sanctions, damages, disgorgement, monetary fines, possible exclusion from participation in government healthcare programs such as Medicare and Medicaid, imprisonment, additional reporting requirements and/or oversight obligations, contractual damages, reputational harm, diminished profits and future earnings and curtailment or restructuring of operations.
Violations of these laws by those who are subject thereto can lead to significant administrative, civil and criminal penalties, including sanctions, damages, disgorgement, monetary fines, possible exclusion from participation in government healthcare programs such as Medicare and Medicaid, imprisonment, additional reporting requirements and/or oversight obligations, contractual damages, reputational harm, diminished profits and future earnings and curtailment or restructuring of operations.
Such obligations may include, without limitation, the Federal Trade Commission Act , the California Consumer Privacy Act of 2018, as amended by the California Privacy Rights Act of 2020 (“CPRA”) (collectively, “CCPA”), the European Union’s General Data Protection 24 Table of Contents Regulation 2016/679 (“EU GDPR”), the EU GDPR as it forms part of United Kingdom law by virtue of section 3 of the European Union (Withdrawal) Act 2018 (“UK GDPR”), the ePrivacy Directive, and wiretapping laws.
Such obligations may include, without limitation, the Federal Trade Commission Act , the California Consumer Privacy Act of 2018, as amended by the California Privacy Rights Act of 2020 (“CPRA”) (collectively, “CCPA”), the European Union’s General Data Protection Regulation 2016/679 (“EU GDPR”), the EU GDPR as it forms part of United Kingdom law by virtue of section 3 of the European Union (Withdrawal) Act 2018 (“UK GDPR”), the ePrivacy Directive, and wiretapping laws.
Our customers have a choice of four different instrument versions that are standardized on the same technology to deliver equivalent high performance—ATx, STx, GTx and the VLx, as well as a portfolio of proprietary related disposables and consumables.
Our customers have a choice of four different instrument versions that are standardized on the same technology to deliver equivalent high performance—ATx, STx, GTx and the VLx, as well as a portfolio of proprietary related PAs and consumables.
Once optimized for the biological function with smaller numbers of cells, the process can be replicated and scaled before being transferred to the clinical platform (GTx) for eventual manufacturing in the cGMP suite or to the STx platform for drug discovery and bioprocessing applications. ​ ExPERT STx: Flow Electroporation for protein production and drug development ​ ​ ​ ​ ​ Our ExPERT STx instrument, which is generally used in the field of protein production and for other drug discovery applications, also incorporates our proprietary Flow Electroporation Technology for high yield transient expression of complex proteins, viral vectors, vaccines, virus like particles (“VLPs”) and biologics.
Once optimized for the biological function with smaller numbers of cells, the process can be replicated and scaled before being transferred to the clinical platform (GTx) for eventual manufacturing in the cGMP suite or to the STx platform for drug discovery and bioprocessing applications. ​ 17 Table of Contents ExPERT STx: Flow Electroporation for protein production and drug development ​ ​ ​ ​ ​ Our ExPERT STx instrument, which is generally used in the field of protein production and for other drug discovery applications, also incorporates our proprietary Flow Electroporation Technology for high yield transient expression of proteins, viral vectors, vaccines, virus like particles (“VLPs”) and biologics.
One key element of this protection is our FDA Master File and Technical Files described in more detail below, which allow us to submit to the regulatory authorities confidential detailed information about our ExPERT system and disposables.
One key element of this protection is our FDA Master File and Technical Files described in more detail below, which allow us to submit to the regulatory authorities confidential detailed information about our ExPERT system and PAs.
We maintain the confidentiality of our trade secrets, know-how and proprietary methods and protocols to protect our intellectual property from competitors including through confidentiality provisions in our agreements with our SPL partners and execution of non-disclosure agreements with prospective clients.
We maintain the confidentiality of our trade secrets, know-how and proprietary methods and protocols to protect our intellectual property from competitors including through confidentiality provisions in our agreements with our SPL customers and execution of non-disclosure agreements with prospective clients.
While difficult to predict given uncertainty around regulatory approvals and clinical risk, the first next-generation ex vivo cell therapies using non-viral approaches was approved in the United States in 2023 using our platform.
While difficult to predict given uncertainty around regulatory approvals and clinical risk, the first next-generation ex vivo cell therapy using non-viral approaches was approved in the United States in 2023 using our platform.
Additionally, our instruments and platform have been used in over 60 clinical trials to date for drugs being developed to treat a variety of indications, from hematological malignancies to solid tumors to inherited genetic disorders.
Additionally, our instruments and platform have been used in over 70 clinical trials to date for drugs being developed to treat a variety of indications, from hematological malignancies to solid tumors to inherited genetic disorders.
In order to support our customers’ use of our platform in regulatory submissions, we have submitted Master 23 Table of Contents Files to the FDA, Center for Biologics Evaluation and Research and Master Files and/or Technical Files to comparable regulatory authorities in other jurisdictions, including Canada, Japan, Australia, the United Kingdom and Austria, and provide nonexclusive Letters of Authorization to the Master or Technical Files under contractual agreements with our customers.
In order to support our customers’ use of our platform in regulatory submissions, we have submitted Master Files to the FDA, Center for Biologics Evaluation and Research and Master Files and/or Technical Files to comparable regulatory authorities in other jurisdictions, including Canada, Japan, Australia, the United Kingdom and Austria, and provide nonexclusive Letters of Authorization to the Master or Technical Files under contractual agreements with our customers.
Users transfer their cells and loading molecules to the sample bag, and the pump on either the GTx or STx instrument pumps a fixed volume of cells into the cartridge chamber where they are electroporated.
Users transfer their cells and loading molecules to the sample bag, and the pump on the GTx , STx or VLx instrument pumps a fixed volume of cells into the cartridge chamber where they are electroporated.
Our disposables and consumables include PAs designed for use with our instruments, as well as accessories supporting PAs such as electroporation buffer solution and software protocols. We have garnered meaningful expertise in cell engineering via our internal research and development efforts as well as our customer-focused commercial approach, which includes a growing application scientist team.
Our disposables include PAs designed for use with our instruments and our consumables include accessories supporting PAs such as electroporation buffer solution and software protocols. We have garnered meaningful expertise in cell engineering via our internal research and development efforts as well as our customer-focused commercial approach, which includes an application scientist team.
Our SPL partnerships allow us to participate in the value creation of our customers’ programs via precommercial milestones and in commercial sales-based payments. We intend to continue to build a portfolio of strategic partnerships with cell therapy developers, which provide us with a growing, diversified source of annual licenses and potential downstream revenue.
Our SPL agreements allow us to participate in the value creation of our customers’ programs via precommercial milestones and in commercial sales-based payments. We intend to continue to build a portfolio of strategic relationships with cell therapy developers, which provide us with a growing, diversified source of annual licenses and potential downstream revenue.
The FDA Master File and equivalent Technical Files and Master Files in other countries can be referenced by our partners to support their own regulatory submissions with the goal of accelerating regulatory submissions processes for our partners.
The FDA Master File and equivalent Technical Files and Master Files in other countries can be referenced by our customers to support their own regulatory submissions with the goal of accelerating regulatory submissions processes for our customers.
Following the successful clinical development leading to FDA approvals of CAR-T cell therapies in blood-based cancers, developers have focused on improving efficacy, lowering the cost of manufacturing and/or expanding engineered cell therapies into new indications, such as solid tumors, as well as autoimmune and neurogenerative diseases.
Following the successful clinical development leading to FDA approvals of CAR-T cell therapies in blood-based cancers, developers have focused on improving efficacy, lowering the cost of manufacturing and/or expanding engineered cell therapies into new indications, such as solid tumors, as well as autoimmune and neurogenerative 12 Table of Contents diseases.
Examples of our two ExPERT PA designs are shown in the pictures below: We have conducted extensive end-user research to continue improving the design of the PAs and the range of products available.
Examples of our two ExPERT PA design classes are shown in the pictures below: We have conducted extensive end-user research to continue improving the design of the PAs and the range of products available.
Manufacturing and Supply We design and develop our PA disposables and conduct final functional testing in our Maryland facility. PAs are manufactured both in our Maryland facility and at a third-party manufacturer. In addition, we design, develop and manufacture our ExPERT instruments in-house.
Manufacturing and Supply We design and develop our PAs and conduct final functional testing in our Maryland facility. PAs are manufactured both in our Maryland facility and at a third-party manufacturer. In addition, we design, develop and manufacture our ExPERT instruments in-house.
Specifically, if a customer wishes to use our products in the clinical phase of process development, they will need to enter into an agreement establishing an SPL partnership, as a customer must obtain clinical rights to perform clinical process development, including for engineering runs. Customer discussion for an SPL partnership can take place any time during our engagement.
Specifically, if a customer wishes to use our products in the clinical phase of process development, they will need to enter into an SPL agreement, as a customer must obtain clinical rights to perform clinical process development, including for engineering runs. Customer discussion for an SPL arrangement can take place any time during our engagement.
The R-1L assembly 19 Table of Contents allows for large volume sample processing that can be adapted to a closed and sterile workflow for continuous end-product production.
The R-1L assembly 20 Table of Contents allows for large volume sample processing that can be adapted to a closed and sterile workflow for continuous end-product production.
Our ExPERT platform enables delivery of almost any molecule into almost any cell type. We believe our ExPERT platform leads the industry in performance, as measured by consistency, efficiency, viability, flexibility and scale. Our ExPERT platform is further supported by a robust intellectual property portfolio. • Comprehensive, high-performance transfection platform .
Our ExPERT platform enables delivery of almost any molecule into almost any cell type. We believe our ExPERT platform leads the industry in performance, as measured by consistency, efficiency, viability, flexibility and scale. Our ExPERT platform is further supported by a robust intellectual property portfolio.
We generate recurring revenue from our ExPERT instrumentation licenses, as well as disposables and consumables (or buffer) sales, which provides high visibility into future near-term revenue.
We generate recurring revenue from our ExPERT instrumentation licenses, as well as PAs and consumables (or buffer) sales, which provides high visibility into future near-term revenue.
Academic clinical licenses can represent opportunities for future SPL partnerships to the extent that commercial entities seek and obtain rights to such programs from the academic institution.
Academic clinical licenses can represent opportunities for future SPL agreements to the extent that commercial entities seek and obtain rights to such programs from the academic institution.
Our ExPERT platform is now the delivery backbone for a number of next-generation cell therapy programs, including one that has received FDA approval and is presently being commercialized. 12 Table of Contents Our Agreements with Customers We have a diverse portfolio of clinical partners and licensees that mirror the overall next-generation engineered ex vivo cell therapies.
Our ExPERT platform is now the delivery backbone for a number of next-generation cell therapy programs, including one that has received FDA approval and is presently being commercialized. Our Agreements with Customers We have a diverse portfolio of clinical customers and licensees that mirror the overall next-generation engineered ex vivo cell therapies.
Annual instrument lease fees are non-refundable and customers may not use our instruments or process assemblies after terminating their agreement with us. We retain title to the leased instrument in each of our licenses.
Annual instrument license fees are non-refundable and customers may not use our instruments or process assemblies after terminating their agreement with us. We retain title to the instrument in each of our licenses.
As part of this strategy, we have focused on obtaining protection for our non-viral delivery platform to the extent possible, particularly in the United States and other key jurisdictions of commercial value.
As part of this strategy, we have focused on obtaining protection for our non-viral delivery platform to the extent possible, particularly in the United 23 Table of Contents States and other key jurisdictions of commercial value.
The platform is also supported by a robust intellectual property portfolio with more than 150 granted U.S. and foreign patents and more than 95 pending patent applications worldwide. From leading commercial cell therapy drug and biologic developers and top biopharmaceutical companies to top academic and government research institutions, including the U.S.
The platform is also supported by a robust intellectual property portfolio with more than 200 granted U.S. and foreign patents and more than 100 pending patent applications worldwide. From leading commercial cell therapy drug and biologic developers and top biopharmaceutical companies to top academic and government research institutions, including the U.S.
We have established a quality management system (under ISO 9001:2015 standards) which is designed to respond to customer expectations and needs and support customer adherence to applicable regulatory requirements. The technologies we offer for potential use by customers in a cGMP environment are produced under this ISO 9001:2015 quality management system.
We have established a quality management system (under ISO 9001:2015 standards) which is designed to respond to customer expectations and needs and support customer adherence to applicable regulatory requirements. The 24 Table of Contents technologies we offer for potential use by customers in a cGMP environment are produced under this ISO 9001:2015 quality management system.
Our FDA Master File, which is a submission to the FDA with confidential detailed information about our products, methods, processes and data, was originally established in 2002 and has been continuously updated as platform improvements have been implemented to support different applications and cell types.
Our FDA Master File, which is a submission 9 Table of Contents to the FDA with confidential detailed information about our products, methods, processes and data, was originally established in 2002 and has been continuously updated as platform improvements have been implemented to support different applications and cell types.
Sales and Marketing We follow a direct sales model in North America, the United Kingdom, and Europe, while also selling through third-party distributors in Asia and some regions of Europe. As of December 31, 2023, we had over 36 field sales and application scientists located in the United States, the United Kingdom, and several regions in Europe and Asia.
Sales and Marketing We follow a direct sales model in North America, the United Kingdom, and Europe, while also selling through third-party distributors in Asia and some regions of Europe. As of December 31, 2024, we had over 33 field sales and application scientists located in the United States, the United Kingdom, and several regions in Europe and Asia.
Our design protection covering the ExPERT system has the potential to provide protection through at least 2036. 22 Table of Contents In addition to our granted patents and filed applications, we maintain protection over a number of trade secrets related to our cell processing technology and other core technology areas, including our electroporation protocols, pulsing patterns, proprietary buffer, and other formulations we have developed.
Our design protection covering the ExPERT system has the potential to provide protection through at least 2048. In addition to our granted patents and filed applications, we maintain protection over a number of trade secrets related to our cell processing technology and other core technology areas, including our electroporation protocols, pulsing patterns, proprietary buffer, and other formulations we have developed.
Our business model enables us to generate revenue from five sources: sales of instruments, disposables and consumables to new customers; additional sales of instruments, disposables and consumables to our existing installed base; annual instrument license fees from cell therapy customers; potential precommercial milestones under SPL partnerships; and potential commercial sales-based payments under SPL partnerships.
Our business model enables us to generate revenue from five sources: sales of instruments, PAs and consumables to new customers; additional sales of instruments, PAs and consumables to our existing installed base; annual instrument license fees from cell therapy customers; potential precommercial milestones under SPL agreements; and potential commercial sales-based payments under SPL agreements.
The following chart summarizes the features of the four ExPERT instruments: ​ 16 Table of Contents ExPERT ATx: Research focused, static electroporation for small to medium scale transfection ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Our ExPERT ATx static electroporation instrument is a research focused, high performance electroporation platform for small to medium scale transfection.
The following chart summarizes the features of the four ExPERT instruments: ​ ExPERT ATx: Research focused, static electroporation for small to medium scale transfection ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Our ExPERT ATx static electroporation instrument is a research focused, high performance electroporation platform for small to medium scale transfection.
Our platform’s ability to engineer a diversity of cell types (including CAR-T, chimeric antigen receptor Natural Killer cells (“CAR-NK/NK”), T cell receptor cells (“TCR”) and stem cells) and cell sources (autologous and allogeneic) enhances our opportunity by potentially providing SPL partnership revenues regardless of which approaches advance in the coming years.
Our platform’s ability to engineer a diversity of cell types (including CAR-T, chimeric antigen receptor Natural Killer cells (“CAR-NK/NK”), T cell receptor cells (“TCR”) and stem cells) and cell sources (autologous and allogeneic) 13 Table of Contents enhances our opportunity by potentially providing SPL agreement revenues regardless of which approaches advance in the coming years.
We currently use distributors in countries in these regions, such as in China and Japan, supplemented by dedicated MaxCyte team 20 Table of Contents members, and continuously assess the need for direct sales and local support personnel to supplement our distributors’ resources.
We currently use distributors in countries in these regions, such as in China and Japan, supplemented by dedicated MaxCyte team members, and continuously assess the need for direct sales and local support personnel to supplement our distributors’ resources.
The instrumentation engineering team focuses on developing and improving electroporation instruments and PA disposables to meet our partners’ wide range of needs from research to commercialization in a GMP environment. The research and development functional teams work together as a core team, following a stage-gate process to develop, qualify and launch new products to market.
The instrumentation engineering team focuses on developing and improving electroporation instruments and PAs to meet our customers’ wide range of needs from research to commercialization in a GMP environment. The research and development functional teams work together as a core team, following a stage-gate process to develop, qualify and launch new products to market.
Since the commercial launch of our first Flow Electroporation instrument in 2003, the installed base of our instruments has grown to more than 680 instruments globally. Our sales force and field application scientists and international partners inform our current and potential customers of current product offerings, new target applications and advances in our technologies and products.
Since the commercial launch of our first Flow Electroporation instrument in 2003, the installed base of our instruments has grown to more than 760 instruments globally. 21 Table of Contents Our sales force and field application scientists and international partners inform our current and potential customers of current product offerings, new target applications and advances in our technologies and products.
The combination of the ExPERT instruments, associated disposables and universal electroporation buffer provides researchers, production scientists, and cGMP facilities with a solution to transfect cells with high efficiency, viability and consistency, which are the three attributes that are consistently ranked by our customers as the top requirements when choosing a cellular or gene engineering platform for clinical use.
The combination of the ExPERT instruments, associated PAs and consumables provides researchers, production scientists, and cGMP facilities with a solution to transfect cells with high efficiency, viability and consistency, which are the three attributes that are consistently ranked by our customers as the top requirements when choosing a cellular or gene engineering platform for clinical use.
A customer relationship may evolve to an SPL partnership after the customer’s drug candidate optimization and verification process nears completion and the clinical process development stage begins.
A customer relationship may evolve to include an SPL agreement after the customer’s drug candidate optimization and verification process nears completion and the clinical process development stage begins.
In return, these SPL partnerships provide us with the ability to receive downstream program-related precommercial milestone payments and, in most cases, commercial sales-based payments. In addition, from our SPL partnership customers, we receive annual research fees for certain products and clinical license fees for others as well as payments from sales of our proprietary disposables as recurring revenue streams.
In return, these SPL agreements provide us with the ability to receive downstream program-related precommercial milestone payments and, in most cases, commercial sales-based payments. In addition, from our SPL customers, we receive annual research fees for certain products and clinical license fees for others as well as payments from sales of our proprietary PAs and consumables as recurring revenue streams.
In addition to the high performance and flexibility of the ExPERT platform, we believe our partnership model further reduces clinical risk and development timelines for our cell therapy partners. By entering into SPL partnerships with us, for example, our partners gain access to our FDA Master File to support their IND-enabling studies and potentially shortening clinical development.
In addition to the high performance and flexibility of the ExPERT platform, we believe our licensing model further reduces clinical risk and development timelines for our cell therapy customers. By entering into SPL agreements with us, for example, our customers gain access to our FDA Master File to support their IND-enabling studies and potentially shortening clinical development.
The Flow Electroporation PA (“Flow PA”) allows for processing of cellular volumes ranging from 10 mL to 100 mL and up to tens of billions of cells. The Flow PA consists of bags and associated tubing, made from medical grade materials, that are connected to the electroporation cartridge.
The Flow Electroporation PA (“Flow PA”) allows for processing of cellular volumes ranging from 5 mL to 1,000 mL and up to tens of billions of cells. The Flow PA consists of bags and associated tubing, made from medical grade materials, that are connected to the electroporation cartridge.
To date, our FDA Master File and Technical Files have been referenced by our customers in over 60 clinical trials. 9 Table of Contents • Recurring revenue model provides high visibility, with drivers of potential long-term upside.
To date, our FDA Master File and Technical Files have been referenced by our customers in over 70 clinical trials. • Recurring revenue model provides high visibility, with drivers of potential long-term upside.
Our SPL customers typically pay an annual license fee per instrument per year for a research license (for preclinical use) or per instrument per year for a clinical license (for clinical or commercial use) or in certain circumstances may purchase an instrument for research use. Partners may also purchase associated single-use disposables and consumables as needed.
Our SPL customers typically pay an annual license fee per instrument per year for a research license (for preclinical use) or per instrument per year for a clinical license (for clinical or commercial use) or in certain circumstances may purchase an instrument for research use. These customers may also purchase associated PAs and consumables as needed.
Our existing customer base, which includes but is not limited to our 26 SPL partners, ranges from large biopharmaceutical companies, including a majority of the top 25 pharmaceutical companies based on 2022 global revenue, to hundreds of biotechnology companies and academic centers focused on translational research.
Our existing customer base, which includes but is not limited to our 29 SPL customers, ranges from large biopharmaceutical companies, including a majority of the top 25 pharmaceutical companies based on 2023 global revenue, to hundreds of biotechnology companies and academic centers focused on translational research.
The Alliance for Regenerative Medicine (“ARM”), an international advocacy organization, estimates that the regenerative medicine sector, which consists of gene, cell, and tissue-based therapeutic developers raised an aggregate of $11.7 billion in 2023 and that, as of February 2024, there were more than 1,900 active clinical trials focused on regenerative and advanced medicine, which includes gene therapy, cell-based immuno-oncology, cell therapy and tissue engineering.
The Alliance for Regenerative Medicine (“ARM”), an international advocacy organization, estimates that the regenerative medicine sector, which consists of gene, cell, and tissue-based therapeutic developers raised an aggregate of $15.2 billion in 2024 and that, as of December 2024, there were more than 1,950 active clinical trials focused on regenerative and advanced medicine, which includes gene therapy, cell-based immuno-oncology, cell therapy and tissue engineering.
Our instruments are sold or licensed for research or clinical use, while the associated disposables and electroporation buffer are sold to support pre-clinical research and development work and are compatible for integration into cGMP manufacturing environments.
Our instruments are sold or licensed for research or clinical use, while the associated PAs and consumables are sold to support pre-clinical research and development work and are compatible for integration into cGMP manufacturing environments.
More information about our equity incentive plan will be available in our proxy statement for the 2024 annual meeting of stockholders. None of our employees is represented by a labor organization or under any collective-bargaining arrangements. We consider our employee relations to be good.
More information about our equity incentive plan will be available in our proxy statement for the 2025 annual meeting of stockholders. None of our employees is represented by a labor organization or under any collective-bargaining arrangements.
Our website and information included in or linked to our website are not part of this Annual Report. 25 Table of Contents Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act are available free of charge through our website as soon as reasonably practicable after they are electronically filed with or furnished to the SEC.
Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act are available free of charge through our website as soon as reasonably practicable after they are electronically filed with or furnished to the SEC.
Once the electroporation is complete, the cells are pumped to the collection bag and the chamber is filled with the next volume of cells for electroporation. This process is repeated until the entire sample volume is processed. The maximum volume of 100 mL of cells can be processed in approximately 15–20 minutes.
Once the electroporation is complete, the cells are pumped to the collection bag and the chamber is filled with the next volume of cells for electroporation. This process is repeated until the entire sample volume is processed. The maximum volume of 1,000 mL of cells can be processed in less than 30 minutes.
Approximately 56% of inventory for the year ended December 31, 2023 was purchased from one supplier. Single source suppliers are chosen for their business stability and scalability to minimize risk.
Approximately 16% of additions to inventory for the year ended December 31, 2024 were from one supplier. Single source suppliers are chosen for their business stability and scalability to minimize risk.
As of March 1, 2024, we have more than 150 granted U.S. and foreign patents, including in Australia, Canada, Japan, China, South Korea, and certain countries in Europe, as well as over 95 pending patent applications worldwide.
As of February 19, 2025, we have more than 200 granted U.S. and foreign patents, including in Australia, Canada, Japan, China, South Korea, and certain countries in Europe, as well as over 100 pending patent applications worldwide.
We believe our ExPERT platform offers a compelling value proposition to our customers due to: (i) the ability to use our technology to deliver almost any molecule into almost any cell type, including hard-to-transfect human primary cells, while maintaining high cell viability and function; (ii) the capacity to introduce larger and more diverse molecules, as well as multiple payloads, which exceeds the capabilities of other intracellular delivery technologies, such as viral vectors; and (iii) the flexibility to scale up from research to cGMP, manufacturing on a single platform—enabling the engineering of cells ranging from tens of thousands of cells to tens of billions of cells in a single transfection run in 30 minutes or less. 11 Table of Contents We believe our ExPERT intracellular delivery platform provides value across numerous applications in the life sciences market, including research, discovery, development, and manufacturing of next-generation, cell-based therapeutics, as well as in biomanufacturing, such as transient protein production for drug discovery and manufacturing of other proteins, including biological therapeutics, viral vectors and vaccines, and small molecule drug discovery.
We believe our ExPERT platform offers a compelling value proposition to our customers due to: (i) the ability to use our technology to deliver almost any molecule into almost any cell type, including hard-to-transfect human primary cells, while maintaining high cell viability and function; (ii) the capacity to introduce larger and more diverse molecules, as well as multiple payloads, which exceeds the capabilities of other intracellular delivery technologies, such as viral vectors; and (iii) the flexibility to scale up from research to cGMP, manufacturing on a single platform without the need for re-optimization —enabling the engineering of cells ranging from tens of thousands of cells to tens of billions of cells in a single transfection run in 30 minutes or less.
Of the over 160 potential programs allowed under our current SPL partnerships, one is in the commercial stage and 16 are active in clinical development, meaning they have at least an FDA-cleared IND application or foreign equivalent.
Of our current SPL customers, one is in the commercial stage and 18 are active in clinical development, meaning they have at least an FDA-cleared IND application or foreign equivalent.
Strategic Platform Licenses (SPLs) Given our value proposition in non-viral delivery, we have established strategic relationships in the form of SPL partnerships with a growing number of leading cell therapy developers as they work to bring next-generation cell therapies into and through clinical development and advance those candidates to potential commercialization. 13 Table of Contents Under these SPL partnerships and other license agreements with our customers, we retain title to the licensed instrument and associated intellectual property, and in exchange for an annual license fee per instrument, we provide our customers with non-exclusive access, for a defined field of use, to our: • cGMP-compatible platform, which enables early-optimization and scale-up from pre-clinical research into clinical development using our intellectual property portfolio; • FDA Master File and Technical Files, which may help accelerate and streamline development and reduce regulatory risk in the creation and development of our partners’ therapeutic drug candidates; • experienced team of sales personnel and application scientists who work directly with our customers to solve cell engineering problems; and • continuous know-how and cell engineering process improvements.
Under these SPL agreements and other license agreements with our customers, we retain title to the licensed instrument and associated intellectual property, and in exchange for an annual license fee per instrument, we provide our customers with non-exclusive access, for a defined field of use, to our: • cGMP-compatible platform, which enables early-optimization and scale-up from pre-clinical research into clinical development using our intellectual property portfolio; • FDA Master File and Technical Files, which may help accelerate and streamline development and reduce regulatory risk in the creation and development of our customers’ therapeutic drug candidates; • experienced team of sales personnel and application scientists who work directly with our customers to solve cell engineering problems; and 14 Table of Contents • continuous know-how and cell engineering process improvements.
Research and development expenses totaled $23.8 million and $19.5 million in the years ended December 31, 2023 and 2022, respectively.
Research and development expenses totaled $22.2 million and $23.8 million in the years ended December 31, 2024 and 2023, respectively.
In 2022, we added the R-20K Flow Electroporation Processing Assembly for our STx and GTx platforms, which can process between 5 mL and 20 mL sample volumes, which can accommodate between 200 million and up to 4 billion cells.
By enabling eight samples to be processed in the same cuvette, a more efficient process can be achieved by users. In 2022, we added the R-20K Flow Electroporation Processing Assembly for our STx and GTx platforms, which can process between 5 mL and 20 mL sample volumes, which can accommodate between 200 million and up to 4 billion cells.
As of March 1, 2024, we owned 17 registered trademarks in the United States, over 190 registered foreign trademarks, 13 pending U.S. trademark applications, and more than 30 pending foreign trademark applications. This collection includes trademarks for our company name, logos and stylized versions of our ExPERT product line names.
As of February 19, 2025, we owned 22 registered trademarks in the United States, over 155 registered foreign trademarks, 9 pending U.S. trademark applications, and more than 20 pending foreign trademark applications. This collection includes trademarks for our company name, logos and stylized versions of our ExPERT product line names.
Upon contract termination, our customers would be responsible for any further clinical studies or data development that regulators may require to allow a change in their cell engineering methodology. We have entered into 26 SPL partnerships with commercial cell therapy developers and, to date, none of our SPL partnership licensees has ever terminated their contract with us.
Upon contract termination, our customers would be responsible for any further clinical studies or data development that regulators may require to allow a change in their cell engineering methodology. We have entered into 30 SPL agreements with commercial cell therapy developers, with 29 of those agreements currently active.
The PAs are designed, developed, and shipped from our headquarters facility. We outsource supply and manufacturing of key PA components. Final clean-room disposables assembly is performed at our headquarters facility and at a third party.
Processing Assemblies Our PAs are only available for purchase directly from us and our third-party distributors and are designed for use only with our instruments. The PAs are designed, developed, and shipped from our headquarters facility. We outsource supply and manufacturing of key PA components. Final clean-room assembly is performed at our headquarters facility and at a third party.
Our platform allows our customers to perform their research and process optimization on a research platform and seamlessly scale to a clinically validated, cGMP environment and 21 CFR Part 11 compatible clinical platform. Further, we believe our platform provides an opportunity for our customers to realize significant time and cost savings.
Our platform allows our customers to perform their research and process optimization on a research platform and seamlessly scale to a clinically validated, cGMP environment and 21 CFR Part 11 compatible clinical platform.
However, clinical development involves a lengthy and expensive process with uncertain outcomes, including the results of pre-clinical research, as well as clinical trials demonstrating product safety and efficacy, and therefore our customers may not begin or complete clinical development, and may never receive FDA or other regulatory approval for all or any product candidates covered by their SPL partnership agreements with us, in which case we will not receive the full potential precommercial milestone payments or the sales-based commercial payments or royalties contemplated by our SPL agreements. 15 Table of Contents Our Products ExPERT Instruments The ExPERT instrument family was designed to provide a single unifying technology that can be used from concept to clinic, with both the research and clinical versions of an instrument incorporating the same underlying technology and protocols.
Clinical development involves a lengthy and expensive process with uncertain outcomes, including the results of pre-clinical research, as well as clinical trials demonstrating product safety and efficacy, and therefore our customers may not begin or complete clinical development, and may never receive FDA or other regulatory approval for all or any product candidates covered by their SPL agreements with us, in which case we will not receive the full potential precommercial milestone payments or the sales-based commercial payments or royalties contemplated by our SPL agreements.
In addition to recurring revenue, we have the potential to receive meaningful precommercial and commercial payments under SPL partnerships as our customers achieve success in advancing programs through the clinical stage and into the commercial stage.
In addition to recurring revenue, we have the potential to receive meaningful precommercial and commercial payments under SPL agreements as our customers achieve success in advancing programs through the clinical stage and into the commercial stage. The total pre-commercial milestone opportunity across our 29 SPL agreements has the potential to generate greater than $2 billion.
All our instruments have been designed to provide customers with the key features required for a scalable high-performance transfection solution. Each of our ExPERT instruments is benchtop with the same small footprint and has integrated touch screens with an intuitive Graphical User Interface (“GUI”), designed for simple training and operation.
Each of our ExPERT instruments is benchtop with the same small footprint and has integrated touch screens with an intuitive Graphical User Interface (“GUI”), designed for simple training and operation.
Employees and Human Capital As of December 31, 2023, we had 143 full-time employees, 81 of whom have advanced degrees, including 29 with Ph.D. degrees. Our human capital resources objectives include, as applicable, identifying, recruiting, retaining, training, incentivizing and integrating our existing and new employees, advisors and consultants.
Employees and Human Capital As of December 31, 2024, we had 114 full-time employees which is inclusive of individuals employed through third-party employer-of-record (“EOR”) employees , 64 of whom have advanced degrees, including 23 with Ph.D. degrees. Our human capital resources objectives include, as applicable, identifying, recruiting, retaining, training, incentivizing and integrating our existing and new employees, advisors and consultants.
By delivering high efficiency at any scale, the ExPERT platform is designed to improve our customers’ ability to achieve the required therapeutic index, enabling accelerated, cost-efficient translation of complex cellular therapies from research to clinical development. 10 Table of Contents Our ExPERT platform consists of four instruments, the ATx, STx, GTx and VLx, which use a broad range of PAs, or disposables, of different volumes to enable scalable electroporation from tens of thousands to billions of cells to facilitate the translation of complex cellular therapies from concept to clinical development, in support of the intended therapeutic commercialization.
Our ExPERT platform consists of four instruments, the ATx, STx, GTx and VLx, which use a broad range of PAs, of different volumes to enable scalable electroporation from tens of thousands to billions of cells to facilitate the translation of complex cellular therapies from concept to clinical development, in support of the intended therapeutic commercialization.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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The actual timing of these events and any resultant revenue to us may vary dramatically due to a number of factors such as delays or failures in our or our current and future partners’ therapeutic discovery and development programs and the numerous uncertainties inherent in the development of therapeutics.
The actual timing of these events and any resultant revenue to us may vary dramatically due to a number of factors such as delays or failures in our current and future partners’ therapeutic discovery and development programs and the numerous uncertainties inherent in the development of therapeutics.
If one of our SPL customers terminates its agreement with us, we may find it more difficult to attract new partners. Our partners, and therefore our potential financial outcomes under our agreements, are also subject to inherent industry-wide FDA and other regulatory risk.
If one of our SPL customers terminates its agreement with us, we may find it more difficult to attract new partners. Our customers, and therefore our potential financial outcomes under our agreements, are also subject to inherent industry-wide FDA and other regulatory risk.
Furthermore, partners, collaborators or other parties to such transactions or arrangements may fail to fully perform their obligations or meet our expectations or cooperate with us satisfactorily for various reasons and subject us to potential risks, including the following: • Partners, collaborators or other parties have significant discretion in determining the efforts and resources that they will apply to a transaction or arrangement; • Partners, collaborators or other parties could independently develop, or develop with third parties, services and products that compete directly or indirectly with our products or product candidates; • Partners, collaborators or other parties may stop, delay or discontinue clinical trials as well as conduct new clinical trials by using our intellectual property or proprietary information; • Partners, collaborators or other parties may not properly maintain or defend our intellectual property rights or may use our intellectual property or proprietary information in a way that gives rise to actual or threatened litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential liabilities; • Disputes may arise between us and partners, collaborators or other parties that cause the delay or termination of the research, development or commercialization of product candidates, or that result in costly litigation or arbitration that diverts management’s attention and resources; • Partners, collaborators or other parties may be terminated and, if terminated, may result in a need for additional capital to pursue further development or commercialization of the applicable services and products; and • Partners, collaborators or other parties may own or co-own intellectual properties covering our product candidates that results from our collaborating with them, and in such cases, we may not have the exclusive right to commercialize such intellectual properties.
Furthermore, partners, collaborators or other parties to such transactions or arrangements may fail to fully perform their obligations or meet our expectations or cooperate with us satisfactorily for various reasons and subject us to potential risks, including the following: • Partners, collaborators or other parties have significant discretion in determining the efforts and resources that they will apply to a transaction or arrangement; • Partners, collaborators or other parties could independently develop, or develop with third parties, services and products that compete directly or indirectly with our products or product candidates; • Partners, collaborators or other parties may stop, delay or discontinue clinical trials as well as conduct new clinical trials by using our intellectual property or proprietary information; • Partners, collaborators or other parties may not properly maintain or defend our intellectual property rights or may use our intellectual property or proprietary information in a way that gives rise to actual or threatened litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential liabilities; • Disputes may arise between us and our partners, collaborators or other parties that cause the delay or termination of the research, development or commercialization of product candidates, or that result in costly litigation or arbitration that diverts management’s attention and resources; • Partners, collaborators or other parties may be terminated and, if terminated, may result in a need for additional capital to pursue further development or commercialization of the applicable services and products; and • Partners, collaborators or other parties may own or co-own intellectual properties covering our product candidates that results from our collaborating with them, and in such cases, we may not have the exclusive right to commercialize such intellectual properties.
Our customers who use our platform and may be exposed to broadly applicable U.S. federal and state healthcare laws and regulations, including those relating to kickbacks and false claims, transparency, and health information privacy and security law. Failure to comply with such laws and regulations may result in substantial penalties.
Our customers who use our platform may be exposed to broadly applicable U.S. federal and state healthcare laws and regulations, including those relating to kickbacks and false claims, transparency, and health information privacy and security law. Failure to comply with such laws and regulations may result in substantial penalties.
Further, our customers are subject to the extensive risks and uncertainties that apply to product candidates in this area including those associated with preclinical and clinical research and development and related regulatory and Institutional Review Board authorization and oversight, manufacturing challenges and compliance standards, the data requirements and review process for seeking marketing authorization, and the potential for safety and efficacy concerns to emerge at any stage of product development and even after approval.
Further, our customers are subject to the extensive risks and uncertainties that apply to product candidates in this area, including those associated with preclinical and clinical research and development and related regulatory and Institutional Review Board (“IRB”) authorization and oversight, manufacturing challenges and compliance standards, the data requirements and review process for seeking marketing authorization, and the potential for safety and efficacy concerns to emerge at any stage of product development and even after approval.
Any future acquisitions we make could subject us to a number of risks, including: • Purchase prices we pay could significantly deplete our cash reserves, impair our future operating flexibility or result in dilution to our existing stockholders; 39 Table of Contents • We may find that the acquired company, assets or technology does not further improve our financial and strategic position as planned; • We may find that we overpaid for the company, asset or technology, or that the economic conditions underlying our acquisition have changed; • We may have difficulty integrating the operations and personnel of the acquired company; • We may have difficulty retaining the employees with the technical skills needed to enhance and provide services with respect to the acquired assets or technologies; • Acquisitions may be viewed negatively by customers, financial markets, or investors; • We may have difficulty incorporating the acquired technologies or products with our existing products; • We may encounter difficulty entering and competing in new product or geographic markets; • We may encounter a competitive response, including price competition or intellectual property litigation; • We may have product liability, customer liability or intellectual property liability associated with the sale of the acquired company’s products; • We may be subject to litigation by terminated employees or third parties; • We may incur debt and restructuring charges; • We may acquire goodwill and other intangible assets that are subject to impairment tests, which could result in future impairment charges; • Our ongoing business and management’s attention may be disrupted or diverted by transition or integration issues and the complexity of managing geographically or culturally diverse enterprises; and • Our due diligence process may fail to identify significant existing issues with the target company’s product quality, product architecture, financial disclosures, accounting practices, internal controls, legal contingencies, intellectual property and other matters.
Any future acquisitions we make could subject us to a number of risks, including: ​ • Purchase prices we pay could significantly deplete our cash reserves, impair our future operating flexibility or result in dilution to our existing stockholders; • We may find that the acquired company, assets or technology does not further improve our financial and strategic position as planned; • We may find that we overpaid for the company, asset or technology, or that the economic conditions underlying our acquisition have changed; • We may have difficulty integrating the operations and personnel of the acquired company; • We may have difficulty retaining the employees with the technical skills needed to enhance and provide services with respect to the acquired assets or technologies; • Acquisitions may be viewed negatively by customers, financial markets, or investors; • We may have difficulty incorporating the acquired technologies or products with our existing products; • We may encounter difficulty entering and competing in new product or geographic markets; • We may encounter a competitive response, including price competition or intellectual property litigation; • We may have product liability, customer liability or intellectual property liability associated with the sale of the acquired company’s products; • We may be subject to litigation by terminated employees or third parties; • We may incur debt and restructuring charges; • We may acquire goodwill and other intangible assets that are subject to impairment tests, which could result in future impairment charges; • Our ongoing business and management’s attention may be disrupted or diverted by transition or integration issues and the complexity of managing geographically or culturally diverse enterprises; and • Our due diligence process may fail to identify significant existing issues with the target company’s product quality, product architecture, financial disclosures, accounting practices, internal controls, legal contingencies, intellectual property and other matters.
Further, setbacks in the clinical trials of our current or future partners, such as serious adverse events, including patient deaths, could significantly impact capital available to customers and our ability to enter into future SPL agreements with new therapeutic product companies. Our growth strategy also involves expanding our international operations.
Further, setbacks in the clinical trials of our current or future customers, such as serious adverse events including patient deaths, could significantly impact capital available to customers and our ability to enter into future SPL agreements with new therapeutic product companies. Our growth strategy also involves expanding our international operations.
The success of the VLx, including new engineering modifications to the platform, may depend in part on the availability, compatibility and capability of appropriate technologies upstream and downstream of electroporation to support potential large-scale applications enabled by the VLx platform, our ability to develop and launch GMP-compliant processing assemblies, and willingness of customers to adopt the VLx for new applications.
The success of the VLx, including new engineering modifications to the platform, may depend in part on the availability, compatibility and capability of appropriate technologies upstream and downstream of electroporation to support potential large-scale applications enabled by the VLx platform, our ability to develop and launch GMP-compliant processing assemblies, and willingness of current and potential customers to adopt the VLx for new applications.
Delays in filing or obtaining (as applicable in each jurisdiction), or our inability to obtain or retain, acceptance of such filings in individual countries could negatively impact the progress of our partners if they intend to run clinical trials in such countries, and as a result, could negatively affect our reputation and revenues or require disclosure of confidential information to our partners.
Delays in filing or obtaining (as applicable in each jurisdiction), or our inability to obtain or retain, acceptance of such filings in individual countries could negatively impact the progress of our customers if they intend to run clinical trials in such countries, and as a result, could negatively affect our reputation and revenues or require disclosure of confidential information to our partners.
If we are unable to implement a valid solution for cross-border data transfers, or if the requirements for a legally-compliant transfer are too onerous, we may face significant adverse consequences, including limitations on our ability to collaborate with partners as well as other service providers, contractors and other companies in Europe; the need to increase our processing capabilities within Europe at significant expense or otherwise change the geographical location or segregation of our relevant systems and operations, and increased exposure to regulatory actions, substantial fines and penalties, and injunctions against our processing or transferring of personal information necessary to operate our business —any or all of which could adversely affect our operations or financial results.
If we are unable to implement a valid solution for cross-border data transfers, or if the requirements for a legally-compliant transfer are too onerous, we may face significant adverse consequences, including limitations on our ability to collaborate with customers as well as other service providers, contractors, and other companies in Europe; the need to increase our processing capabilities within Europe at significant expense or otherwise change the geographical location or segregation of our relevant systems and operations, increased exposure to regulatory actions, substantial fines and penalties, and injunctions against our processing or transferring of personal information necessary to operate our business —any or all of which could adversely affect our operations or financial results.
Many of the companies developing or marketing competing or alternative products have competitive advantages when compared to us, including: • greater financial and human resources for product development, sales and marketing; • greater domestic and international name recognition and more product familiarity among users; • broader and more established relationships with pharmaceutical companies and academic institutions; • broader product lines and the ability to offer lower prices or rebates, integrate technologies more successfully to offer better workflow solutions, bundle products to offer greater discounts or incentives or offer more attractive milestone and partnership terms; • broader intellectual property protection for their technology and products; • larger sales forces and broader and more established domestic and international sales and marketing and distribution networks; and • more experience in conducting research and development, manufacturing and preparing regulatory submissions, both in the United States and in foreign jurisdictions.
Many of the companies developing or marketing competing or alternative products have competitive advantages when compared to us, including: • greater financial and human resources for product development, sales and marketing; • greater domestic and international name recognition and more product familiarity among users; • broader and more established relationships with pharmaceutical companies and academic institutions; • broader product lines and the ability to offer lower prices or rebates, integrate technologies more successfully to offer better workflow solutions, bundle products to offer greater discounts or incentives or offer more attractive milestone and agreement terms; • broader intellectual property protection for their technology and products; • larger sales forces and broader and more established domestic and international sales and marketing and distribution networks; and • more experience in conducting research and development, manufacturing and preparing regulatory submissions, both in the United States and in foreign jurisdictions.
In addition, quality issues may impair our relationships with new or existing customers and adversely affect our brand image, and our reputation could suffer, which could adversely affect our business, financial condition, results of operations, cash flows and prospects. The failure of our partners to meet their contractual obligations to us could adversely affect our business.
In addition, quality issues may impair our relationships with new or existing customers and adversely affect our brand image, and our reputation could suffer, which could adversely affect our business, financial condition, results of operations, cash flows and prospects. The failure of our customers to meet their contractual obligations to us could adversely affect our business.
We presently do not have long-term supply contracts for these components, and none of our third-party suppliers is obligated to supply products to us for any specific period or in any specific quantities, except as may be provided for in submitted and accepted purchase orders.
We presently do not have long-term supply contracts for any components, and none of our third-party suppliers is obligated to supply products to us for any specific period or in any specific quantities, except as may be provided for in submitted and accepted purchase orders.
Our current certificate of incorporation and bylaws include provisions that: • authorize our board of directors to issue, without further action by the stockholders, shares of undesignated preferred stock with terms, rights, and preferences determined by our board of directors that may be senior to our common stock; 68 Table of Contents • require that any action to be taken by our stockholders be effected at a duly called annual or special meeting and not by written consent; • specify that special meetings of our stockholders can be called only by our board of directors, the chairperson of our board of directors, or our chief executive officer; • establish an advance notice procedure for stockholder proposals to be brought before an annual meeting, including proposed nominations of persons for election to our board of directors; • establish that our board of directors is divided into three classes, with each class serving three- year staggered terms; • prohibit cumulative voting in the election of directors; • provide that our directors may be removed (i) with or without cause, upon the vote of at least 50% of the outstanding shares of voting stock or (ii) with cause, by the affirmative vote or consent of at least two-thirds of the other members of our board of directors; and • provide that vacancies on our board of directors may be filled only by a majority of directors then in office, even though less than a quorum.
Our current certificate of incorporation and bylaws include provisions that: • authorize our board of directors to issue, without further action by the stockholders, shares of undesignated preferred stock with terms, rights, and preferences determined by our board of directors that may be senior to our common stock; • require that any action to be taken by our stockholders be effected at a duly called annual or special meeting and not by written consent; • specify that special meetings of our stockholders can be called only by our board of directors, the chairperson of our board of directors, or our chief executive officer; • establish an advance notice procedure for stockholder proposals to be brought before an annual meeting, including proposed nominations of persons for election to our board of directors; • establish that our board of directors is divided into three classes, with each class serving three- year staggered terms; • prohibit cumulative voting in the election of directors; • provide that our directors may be removed (i) with or without cause, upon the vote of at least 50% of the outstanding shares of voting stock or (ii) with cause, by the affirmative vote or consent of at least two-thirds of the other members of our board of directors; and • provide that vacancies on our board of directors may be filled only by a majority of directors then in office, even though less than a quorum.
Potential implications of future public health emergencies may include: • our customer prospects and our existing customers may experience slowdowns in their businesses, and our academic institution customers may experience decreases in government funding of research and development, which in turn may result in reduced demand for our products, lengthening of sales cycles, loss of customers, difficulties in collections, and inaccurate inventory forecasting; • limitations on our business operations by local, state, provincial and/or federal governments that could impact our ability to sell products to customers, and visit customers for process optimization of their cellular therapies; • delays in negotiations with partners and potential partners; • interruption of or delays in receiving supplies from the third parties we rely on to manufacture components to our products, which may impair our ability to sell our products; • interruption of or delays in installation of our products for our customers and partners; • interruption of or delays in the shipments of purchased products to customers or to our distribution partners; • decreased employee productivity and morale, with increased employee attrition and risk of a cyberattack resulting from our employees working from home; • disruptions and significant costs to our growth planning, such as for facilities and international expansion; • costs in fully returning to work from our facilities around the world, including changes to the workplace, such as space planning, food service and amenities; • legal liability for safe workplace claims; • loss of critical vendors or third-party partners, which may go out of business; and • continued cancellation of in-person marketing events, including industry conferences, and prolonged delays in our ability to reschedule or conduct in-person marketing events and other sales and marketing activities.
Potential implications of future public health emergencies may include: • our customer prospects and our existing customers may experience slowdowns in their businesses, and our academic institution customers may experience decreases in government funding of research and development, which in turn may result in reduced demand for our products, lengthening of sales cycles, loss of customers, difficulties in collections, and inaccurate inventory forecasting; • limitations on our business operations by local, state, provincial and/or federal governments that could impact our ability to sell products to customers, and visit customers for process optimization of their cellular therapies; • delays in negotiations with SPL customers and potential partners; • interruption of or delays in receiving supplies from the third parties we rely on to manufacture components to our products, which may impair our ability to sell our products; • interruption of or delays in installation of our products for our customers and partners; • interruption of or delays in the shipments of purchased products to customers or to our distribution partners; 55 Table of Contents • decreased employee productivity and morale, with increased employee attrition and risk of a cyberattack resulting from our employees working from home; • disruptions and significant costs to our growth planning, such as for facilities and international expansion; • costs in fully returning to work from our facilities around the world, including changes to the workplace, such as space planning, food service and amenities; • legal liability for safe workplace claims; • loss of critical vendors or third-party partners, which may go out of business; and • continued cancellation of in-person marketing events, including industry conferences, and prolonged delays in our ability to reschedule or conduct in-person marketing events and other sales and marketing activities.
We and the third parties upon which we rely are subject to a variety of evolving threats, including but not limited to, malicious code (such as viruses and worms), personnel misconduct or error, malware (including as a result of advanced persistent threat intrusions), ransomware attacks, denial-of-service attacks (such as credential stuffing), credential harvesting, social-engineering attacks (including through phishing attacks), ransomware attacks, supply-chain attacks, personnel misconduct or error, software bugs, server malfunctions, software or hardware failures, loss of data or other information technology assets, adware, telecommunications failures, earthquakes, fires, floods, and other similar threats.
We and the third parties upon which we rely are subject to a variety of evolving threats, including but not limited to, malicious code (such as viruses), personnel misconduct or error, malware (including as a result of advanced persistent threat intrusions), ransomware attacks, denial-of-service attacks (such as credential stuffing), credential harvesting, social-engineering attacks (including through phishing attacks), ransomware attacks, supply-chain attacks, personnel misconduct or error, insider threats, software bugs, server malfunctions, software or hardware failures, loss of data or other information technology assets, adware, telecommunications failures, earthquakes, fires, floods, and other similar threats.
If a pandemic, epidemic, outbreak of an infectious disease, or other public health emergency occurs in the United States or worldwide, our business may be adversely affected, by, among other things, disruptions to the research and development activities of our customers, disruptions to the development of our collaboration partners’ product candidates, disruptions to our ability to enter into new collaborations with potential partners in a timely manner, disruptions in the operations of our third-party manufacturing organizations upon whom we rely for the production and supply of our products, and other disruptions to our operations.
If a pandemic, epidemic, outbreak of an infectious disease, or other public health emergency occurs in the United States or worldwide, our business may be adversely affected, by, among other things, disruptions to the research and development activities of our customers, disruptions to the development of our collaboration partners’ product candidates, disruptions to our ability to enter into new collaborations with potential SPL customers in a timely manner, disruptions in the operations of our third-party manufacturing organizations upon whom we rely for the production and supply of our products, and other disruptions to our operations.
Further, we could encounter delays and setbacks in implementing engineering modifications necessary for certain large-scale applications, resulting in delayed acceptance by future customers and partners of such a large-scale system.
Further, we could encounter delays and setbacks in implementing engineering modifications necessary for certain large-scale applications, resulting in delayed acceptance by future customers of such a large-scale system.
Our reliance on our partners poses a number of additional risks, including the risk that they may not perform their contractual obligations to our standards, in compliance with applicable legal or contractual requirements, in a timely manner or at all; they may not maintain the confidentiality of our proprietary information; and disagreements or disputes could arise that could cause delays in, or termination of, the research, development or commercialization of therapeutic candidates produced using our instruments and PAs.
Our reliance on our customers poses a number of additional risks, including the risk that they may not perform their contractual obligations to our standards, in compliance with applicable legal or contractual requirements, in a timely manner or at all; they may not maintain the confidentiality of our proprietary information; and disagreements or disputes could arise that could cause delays in, or termination of, the research, development or commercialization of therapeutic candidates produced using our instruments and PAs.
Even if we are able to enter into additional future SPL arrangements and similar arrangements for future therapeutic products that have not yet been partnered, there can be no assurance that any of the therapeutic products that are being or might be developed by our partners using our technology will continue to advance through clinical development, receive regulatory approvals or be successfully developed into commercially viable products.
Even if we are able to enter into additional future SPL arrangements and similar arrangements for future therapeutic products that have not yet been partnered, there can be no assurance that any of the therapeutic products that are being or might be developed by our customers using our technology will continue to advance through clinical development, receive regulatory approvals or be successfully developed into commercially viable products.
Our operations, including our manufacturing operations, and the operations of our customers, partners, distributors and collaborators could be subject to earthquakes, power shortages, telecommunications failures, water shortages, floods, hurricanes, typhoons, fires, extreme weather conditions, medical epidemics and pandemics, including COVID-19, other natural or man-made disasters or business interruptions, and geopolitical conflicts, for which we are predominantly self-insured.
Our operations, including our manufacturing operations, and the operations of our customers, partners, distributors and collaborators could be subject to earthquakes, power shortages, telecommunications failures, water shortages, floods, hurricanes, typhoons, fires, extreme weather conditions, medical epidemics and pandemics, other natural or man-made disasters or business interruptions, and geopolitical conflicts, for which we are predominantly self-insured.
We will remain an emerging growth company until the earliest of: (i) December 31, 2026, which is the last day of the fiscal year following the fifth anniversary of our initial public offering in the United States; (ii) the last day of the 67 Table of Contents first fiscal year in which our annual gross revenue is $1.235 billion or more; (iii) the date on which we have, during the previous rolling three-year period, issued more than $1 billion in non-convertible debt securities; and (iv) the last day of the fiscal year in which the market value of our common stock held by non-affiliates exceeded $700 million as of June 30 of such fiscal year.
We will remain an emerging growth company until the earliest of: (i) December 31, 2026, which is the last day of the fiscal year following the fifth anniversary of our initial public offering in the United States; (ii) the last day of the first fiscal year in which our annual gross revenue is $1.235 billion or more; (iii) the date on which we have, during the previous rolling three-year period, issued more than $1 billion in non-convertible debt securities; and (iv) the last day of the fiscal year in which the market value of our common stock held by non-affiliates exceeded $700 million as of June 30 of such fiscal year.
Identifying and qualifying alternate sources may take time and involve additional expense, and there is no guarantee that current suppliers or alternate sources will timely deliver materials that meet our needs. If our customers experience a shortage or delay in delivery of our ExPERT instruments, PAs or buffers our business could be materially and adversely impacted.
Identifying and qualifying alternate sources may take time and involve additional expense, and there is no guarantee that current suppliers or alternate sources will timely deliver materials that meet our needs. If our customers experience a shortage or delay in delivery of our ExPERT instruments, PAs or consumables our business could be materially and adversely impacted.
If we or the third parties on which we rely fail, or are perceived to have failed, to address or comply with applicable data privacy and security obligations, we could face significant consequences, including but not limited 49 Table of Contents to: government enforcement actions (e.g., investigations, fines, penalties, audits, inspections, and similar); litigation (including class-related claims);additional reporting requirements and/or oversight; temporary or permanent bans on all or some processing of personal information; orders to destroy or not use personal information; and imprisonment of company officials.
If we or the third parties on which we rely fail, or are perceived to have failed, to address or comply with applicable data privacy and security obligations, we could face significant consequences, including but not limited to: government enforcement actions (e.g., investigations, fines, penalties, audits, inspections, and similar); litigation (including class-related claims); additional reporting requirements and/or oversight; temporary or permanent bans on all or some processing of personal information; orders to destroy or not use personal information; and imprisonment of company officials.
To become and remain profitable, we must succeed in realizing meaningful precommercial milestone payments from our current SPLs and potentially secure future commercial partnership, licensing or collaboration arrangements for use of our cell engineering platforms and similar arrangements for cell therapy programs in development that have not yet been partnered.
To become and remain profitable, we must succeed in realizing meaningful precommercial milestone payments from our current SPLs and potentially securing future commercial partnership, licensing or collaboration arrangements for use of our cell engineering platforms and similar arrangements for cell therapy programs in development that have not yet been partnered.
As a result, if we fail to maintain our relationships with our partners or if any of our partners discontinue their programs or transition to alternative cell engineering technologies, our future results of operations could be materially and adversely affected. An increasing portion of our revenue is derived from milestone payments from our SPL customers.
As a result, if we fail to maintain our relationships with our SPL customers or if any of these customers discontinue their programs or transition to alternative cell engineering technologies, our future results of operations could be materially and adversely affected. An increasing portion of our revenue is derived from milestone payments from our SPL customers.
These fluctuations may occur due to a variety of factors, many of which are outside of our control, including, but not limited to the: • level of demand for any of our products, which may vary significantly; • timing and cost of, and level of investment in, research, development, manufacturing, regulatory approval and commercialization activities for partners relating to our products, which may change from time to time; • size, seasonality and customer mix of the cell engineering market; • start, milestone attainment and completion of programs in which our platform is utilized; • sales and marketing efforts and expenses we incur; 52 Table of Contents • rate at which we grow our sales force and the speed at which newly-hired salespeople become effective; changes in the productivity of our sales force; • positive or negative coverage in the media or publications of our products or competitive products; • cost of manufacturing our products, which may vary depending on the quantity of production and the terms of our arrangements with our suppliers; • degree of competition in our industry and any change in the competitive landscape of our industry, including the introduction of new products or enhancements or technologies by us or others in the cell engineering market and competition-related pricing pressures; • changes in governmental regulations or in the status of regulatory approvals or applications; • future accounting pronouncements or changes in our accounting policies; • disruptions to our business and operations or to the business and operations of our suppliers, distributors, and other third parties with whom we conduct business resulting from the COVID-19 public health emergency or other widespread public health emergencies; • future global financial crises and economic downturns, including those caused by widespread public health emergencies or geopolitical conflicts; and • general market conditions and other factors, including factors unrelated to our operating performance or the operating performance of our competitors.
These fluctuations may occur due to a variety of factors, many of which are outside of our control, including, but not limited to the: • level of demand for any of our products, which may vary significantly; • timing and cost of, and level of investment in, research, development, manufacturing, regulatory approval, and commercialization activities for customers relating to our products, which may change from time to time; • size, seasonality, and customer mix of the cell engineering market; • start, milestone attainment, and completion of programs in which our platform is utilized; • sales and marketing efforts and expenses we incur; • rate at which we grow our sales force and the speed at which newly-hired salespeople become effective; changes in the productivity of our sales force; • positive or negative coverage in the media or publications of our products or competitive products; 53 Table of Contents • cost of manufacturing our products, which may vary depending on the quantity of production and the terms of our arrangements with our suppliers; • degree of competition in our industry and any change in the competitive landscape of our industry, including the introduction of new products or enhancements or technologies by us or others in the cell engineering market and competition-related pricing pressures; • changes in governmental regulations or in the status of regulatory approvals or applications; • future accounting pronouncements or changes in our accounting policies; • disruptions to our business and operations or to the business and operations of our suppliers, distributors, and other third parties with whom we conduct business resulting from public health emergencies; • future global financial crises and economic downturns, including those caused by widespread public health emergencies or geopolitical conflicts; and • general market conditions and other factors, including factors unrelated to our operating performance or the operating performance of our competitors.
Biopharmaceutical drug , biologics and therapeutics development is inherently uncertain, and it is possible that none of the drug, biologic or therapeutic candidates discovered using our platform that are further developed by our partners will receive marketing approval or become viable commercial products on a timely basis or at all.
Biopharmaceutical drug , biologics and therapeutics development is inherently uncertain, and it is possible that none of the drug, biologic or therapeutic candidates discovered using our platform that are further developed by our customers will receive marketing approval or become viable commercial products on a timely basis or at all.
Likewise, our partners have to make decisions about which clinical stage and preclinical drug, biologic and therapeutic candidates to develop and advance, and our partners may not have the resources to invest in all of the drug, biologic or therapeutic candidates that are produced using our platform, or clinical data and other development considerations may not support the advancement of one or more drug candidates developed using our platform.
Likewise, our customers have to make decisions about which clinical stage and preclinical drug, biologic and therapeutic candidates to develop and advance, and our customers may not have the resources to invest in all of the drug, biologic or therapeutic candidates that are produced using our platform, or clinical data and other development considerations may not support the advancement of one or more drug candidates developed using our platform.
We rely on a limited number of suppliers for certain key components utilized in the assembly of our ExPERT instruments and manufacture of our PAs and buffer, and in some cases, such as certain instrument components ( e.g. , CPU chips or PA electrodes), we rely on a single supplier for a particular component, subassembly or consumable.
We rely on a limited number of suppliers for certain key components utilized in the assembly of our ExPERT instruments and manufacture of our PAs and consumables, and in some cases, such as certain instrument components ( e.g. , CPU chips or PA electrodes), we rely on a single supplier for a particular component, subassembly or consumable.
The market price of our common stock may be highly volatile and may fluctuate or decline substantially as a result of a variety of factors, some of which are beyond our control, including: • actual or anticipated fluctuations in our financial condition or results of operations; • variance in our financial performance from expectations of securities analysts; • changes in our projected operating and financial results; • announcements by us or our competitors of significant business developments, acquisitions, or new offerings; • announcements by our partners on clinical development delays for products being enabled by our technology; • announcements or concerns regarding real or perceived safety or efficacy issues with our products or similar products of our competitors; • adoption of new regulations applicable to our industry or the expectations concerning future regulatory developments; • our involvement in litigation; • future sales of our common stock by us or our stockholders; • changes in senior management, the board of directors or key personnel; • the trading volume of our common stock; • changes in the anticipated future size and growth rate of our market; and • general economic, macroeconomic and market conditions.
The market price of our common stock may be highly volatile and may fluctuate or decline substantially as a result of a variety of factors, some of which are beyond our control, including: • actual or anticipated fluctuations in our financial condition or results of operations; • variance in our financial performance from expectations of securities analysts; • changes in our projected operating and financial results; • announcements by us or our competitors of significant business developments, acquisitions, or new offerings; • announcements by our customers on clinical development delays for products being enabled by our technology; • announcements or concerns regarding real or perceived safety or efficacy issues with our products or similar products of our competitors; • adoption of new regulations applicable to our industry or the expectations concerning future regulatory developments; • our involvement in litigation; • future sales of our common stock by us or our stockholders; 65 Table of Contents • changes in senior management, the board of directors or key personnel; • the trading volume of our common stock; • changes in the anticipated future size and growth rate of our market; and • general economic, macroeconomic and market conditions.
Material, one-time milestone payments earned as SPL partners achieve clinical progress are also a significant portion of our revenue, although such milestone payments are not in our control, are unpredictable because of the early-stage nature of cell therapy clinical development, and may contribute materially to the volatility of our revenue.
Material, one-time milestone payments earned as SPL customers achieve clinical progress are also a significant portion of our revenue, although such milestone payments are not in our control, are unpredictable because of the early-stage nature of cell therapy clinical development, and may contribute materially to the volatility of our revenue.
Our partners may not achieve projected development and regulatory milestones and other anticipated key events in the expected timelines or at all, or may discontinue some or all of their programs, which could have an adverse impact on our business and could cause the price of our common stock to decline.
Our customers may not achieve projected development and regulatory milestones and other anticipated key events in the expected timelines or at all, or may discontinue some or all of their programs, which could have an adverse impact on our business and could cause the price of our common stock to decline.
The number and types of preclinical studies and clinical trials that will be required for regulatory approval also varies depending on the product candidate (including cell therapies, for which development is inherently challenging), the disease or condition that the product candidate is designed to address, and the regulations applicable to any particular product candidate.
The number and types of preclinical studies and clinical trials that will be required for regulatory approval also vary depending on the product candidate (including cell therapies, for which development is inherently challenging), the disease or condition that the product candidate is designed to address, and the regulations applicable to any particular product candidate.
In addition, even if these drug, biologic or therapeutic candidates receive regulatory approval in the United States, our partners may never obtain approval or commercialize them outside of the United States, which would limit their full market potential and therefore may impact our ability to realize their potential downstream value.
In addition, even if these drug, biologic or therapeutic candidates receive regulatory approval in the United States, our customers may never obtain approval or commercialize them outside of the United States, which would limit their full market potential and therefore may impact our ability to realize their potential downstream value.
Under the EU GDPR and UK GDPR, government regulators may impose temporary or definitive bans on data processing and other corrective actions; fines of up to €20 million (£17.5 million under the UK GDPR) or up to 4% of the total worldwide annual turnover of the preceding financial year, whichever is higher; or private litigation related to the processing of personal information brought by classes of data subjects or consumer protection organizations 48 Table of Contents authorized at law to represent their incidents.
Under the EU GDPR and UK GDPR, government regulators may impose temporary or definitive bans on data processing and other corrective actions; fines of up to €20 million (£17.5 million under the UK GDPR) or up to 4% of the total worldwide annual turnover of the preceding financial year, whichever is higher; or private litigation related to the processing of personal information brought by classes of data subjects or consumer protection organizations authorized at law to represent their incidents.
Future actions or escalations by either the United States or China that affect trade relations may also negatively affect our business, or that of our suppliers or customers, and we cannot provide any assurances as to whether such actions will occur or the form that they may take.
Future actions or escalations by either the United States, China or other nations that affect trade relations may also negatively affect our business, or that of our suppliers or customers, and we cannot provide any assurances as to whether such actions will occur or the form that they may take.
Our partners’ failure to effectively advance, market and sell suitable drug, biologic and therapeutic candidates developed using our platform could have a material adverse effect on our business, financial condition, results of operations and prospects, and cause the market price of our common stock to decline.
Our customers’ failure to effectively advance, market and sell suitable drug, biologic and therapeutic candidates developed using our platform could have a material adverse effect on our business, financial condition, results of operations and prospects, and cause the market price of our common stock to decline.
We cannot be certain that the FDA or foreign regulators will not require audits of and information on our ExPERT systems used in clinical development as our partners advance their cellular therapies from preclinical through clinical development toward marketing approval.
We cannot be certain that the FDA or foreign regulators will not require audits of and information on our ExPERT systems used in clinical development as our customers advance their cellular therapies from preclinical through clinical development toward marketing approval.
Any of these events could have a material adverse effect on our reputation, business or financial condition, including but not limited to: loss of actual or prospective customers, collaborators or partners; interruptions or stoppages in our business operations; inability to process personal information or to operate in certain jurisdictions; limited ability to develop or commercialize our products; expenditure of time and resources to defend any claim or inquiry; adverse publicity; or revision or restructuring of our business model or operations.
Any of these events could have a material adverse effect on our reputation, business, or financial condition, including but not limited to: loss of actual or prospective customers, collaborators, or partners; interruptions or stoppages in our business operations; inability to process personal information or to operate in certain jurisdictions; limited ability to develop or commercialize our 50 Table of Contents products; expenditure of time and resources to defend any claim or inquiry; adverse publicity; or revision or restructuring of our business model or operations.
To operate successfully, or for our partners to obtain regulatory approval in other countries, we must comply with numerous and varying regulatory requirements imposed by such countries regarding safety, efficacy, manufacturing, clinical trials, commercial sales, pricing and distribution of our products.
To operate successfully, or for our customers to obtain regulatory approval in other countries, we must comply with numerous and varying regulatory requirements imposed by such countries regarding safety, efficacy, manufacturing, clinical trials, commercial sales, pricing and distribution of our products.
Even if we are successful in defending against these claims, litigation could result in substantial costs and be a distraction to management. 60 Table of Contents ​ Business disruptions could seriously harm our future revenue and financial condition and increase our costs and expenses.
Even if we are successful in defending against these claims, litigation could result in substantial costs and be a distraction to management. 61 Table of Contents ​ Business disruptions could seriously harm our future revenue and financial condition and increase our costs and expenses.
In addition, if we experience a significant increase in demand, we may not have adequate manufacturing capacity to meet such demand, and additional supplies may not be available when required on terms that are acceptable to us, or at all, or suppliers may not be able to allocate sufficient capacity in order to meet our increased requirements, all of which could negatively affect our business, financial condition and results of operations.
In addition, if we experience a significant increase in demand, we may not have adequate manufacturing capacity to meet such demand, and additional supplies may not be available when required on terms that 43 Table of Contents are acceptable to us, or at all, or suppliers may not be able to allocate sufficient capacity in order to meet our increased requirements, all of which could negatively affect our business, financial condition and results of operations.
In addition, the demand for our products may depend upon the research and development budgets of these customers, which are impacted by factors beyond our control, such as: 31 Table of Contents • macroeconomic conditions, and the political climate; • investor confidence in the biopharmaceutical industry and the amount of capital such investors provide to our potential customers; • reduced pricing of approved therapeutics; • scientists’ and customers’ opinions of the utility of new products or services; • changes in the regulatory environment; • differences in budgetary cycles; • competitor product offerings or pricing; • merger and acquisition activity within the industry; • market-driven pressures to consolidate operations and reduce costs; • market acceptance of relatively new technologies, such as ours; • clinical trial or milestone failures that impact our customers’ ability to raise capital; and • inability to sustain capital requirements or bankruptcy.
In addition, the demand for our products may depend upon the research and development budgets of these customers, which are impacted by factors beyond our control, such as: • macroeconomic conditions, and the geopolitical climate; • investor confidence in the biopharmaceutical industry and the amount of capital such investors provide to our potential customers; • reduced pricing of approved therapeutics; • scientists’ and customers’ opinions of the utility of new products or services; • changes in the regulatory environment; • differences in budgetary cycles; • competitor product offerings or pricing; • merger and acquisition activity within the industry; • market-driven pressures to consolidate operations and reduce costs; • market acceptance of relatively new technologies, such as ours; • clinical trial or milestone failures that impact our customers’ ability to raise capital; and • inability to sustain capital requirements or bankruptcy.
We do not have our own pipeline of therapeutic candidates, and instead we focus our efforts on the development of our cell engineering offerings, including our ExPERT platform. Our partners then use our instruments and PAs for cell engineering to develop their own therapeutic candidates without our direct involvement.
We do not have our own pipeline of therapeutic candidates, and instead we focus our efforts on the development of our cell engineering offerings, including our ExPERT platform. Our customers then use our instruments and PAs for cell engineering to develop their own therapeutic candidates without our direct involvement.
Additionally, subject to its contractual obligations to us, if one or more of our partners is involved in a business combination, the partner might deemphasize or terminate the development or commercialization of any drug, biologic or therapeutic candidate that utilizes our platform.
Additionally, subject to its contractual obligations to us, if one or more of our customers is involved in a business combination, the partner might deemphasize or terminate the development or commercialization of any drug, biologic or therapeutic candidate that utilizes our platform.
In addition, certain of our partners are large, multinational organizations that run many programs concurrently, and we are dependent on their ability to accurately track and make milestone payments to us pursuant to the terms of our agreements with them.
In addition, certain of our customers are large, multinational organizations that run many programs concurrently, and we are dependent on their ability to accurately track and make milestone payments to us pursuant to the terms of our agreements with them.
Without the timely introduction of new instruments, single-use disposables software, services, enhancements and new product integrations with electroporation, our offerings may become less competitive over time, in which case our competitive position and operating results could suffer.
Without the timely introduction of new instruments, single-use PAs, software, services, enhancements and new product integrations with electroporation, our offerings may become less competitive over time, in which case our competitive position and operating results could suffer.
We do not plan to disclose, and historically, have not disclosed, the development status and progress of individual therapeutic candidates of our partners. Our partners may wish to report such information more or less frequently than we prefer or may not wish to report such information at all.
We do not plan to disclose, and historically, have not disclosed, the development status and progress of individual therapeutic candidates of our customers. Our customers may wish to report such information more or less frequently than we prefer or may not wish to report such information at all.
Decision-making about which drug or therapeutic candidates to prioritize involves inherent uncertainty, and our partners’ development program decision-making and resource prioritization decisions, which are outside of our control, may adversely affect the potential value of those partnerships.
Decision-making about which drug or therapeutic candidates to prioritize involves inherent uncertainty, and our partners’ development program decision-making and resource prioritization decisions, which are outside of our control, may adversely affect the potential value of those agreements.
In addition, supply-chain attacks have increased in frequency and severity, and we cannot guarantee that third parties and 55 Table of Contents infrastructure in our supply chain or our third-party partners’ supply chains have not been compromised or that they do not contain exploitable defects or bugs that could result in a breach of or disruption to our information technology systems (including our products) or the third-party information technology systems that support us and our services.
In addition, supply-chain attacks have increased in frequency and severity, and we cannot guarantee that third parties and infrastructure in our supply chain or our third-party partners’ supply chains have not been compromised or that they do not contain exploitable defects or bugs that could result in a breach of or disruption to our information technology systems (including our products) or the third-party information technology systems that support us and our services.
For example, our instruments or PAs could fail or our partners could use our technology improperly and blame a failure on our systems, resulting in customer complaints and significant resources dedicated to finding the cause of the failure and/or developing a solution.
For example, our instruments or PAs could fail or our customers could use our technology improperly and blame a failure on our systems, resulting in customer complaints and significant resources dedicated to finding the cause of the failure and/or developing a solution.
If our partners fail to achieve one or more of these milestones or other key events as we or they expect, our business could be materially adversely affected and the price of our common stock could decline.
If our customers fail to achieve one or more of these milestones or other key events as we or they expect, our business could be materially adversely affected and the price of our common stock could decline.
We offer our cell engineering platform to partners who are engaged in drug, biologics and therapeutics discovery and development. These partners include large pharmaceutical companies, biotechnology companies of all sizes and non-profit and academic institutions.
We offer our cell engineering platform to customers who are engaged in drug, biologics and therapeutics discovery and development. These customers include large pharmaceutical companies, biotechnology companies of all sizes and non-profit and academic institutions.
Obtaining export licenses can be difficult, costly and time-consuming and we may not always be successful in obtaining necessary export licenses, and our failure to obtain required export approval for our products or limitations on our ability to export or sell our products imposed by export control or sanctions laws may harm our revenues and adversely affect our business, financial condition, and results of operations.
Obtaining export licenses can be difficult, costly and time-consuming and we may not always be successful in obtaining necessary export licenses, and our failure to obtain required export approval for our products or limitations on our ability to export or sell our products imposed by export control or sanctions laws may harm our revenues and adversely affect our business, financial condition, and results of 48 Table of Contents operations.
In addition, in the future, we may issue additional shares of common stock or other equity or debt securities convertible 66 Table of Contents into common stock in connection with a financing, acquisition, litigation settlement, employee arrangements or otherwise. Any such future issuance could result in substantial dilution to our existing stockholders and could cause our stock price to decline.
In addition, in the future, we may issue additional shares of common stock or other equity or debt securities convertible into common stock in connection with a financing, acquisition, litigation settlement, employee arrangements, or otherwise. Any such future issuance could result in substantial dilution to our existing stockholders and could cause our stock price to decline.
Our offerings include products such as instruments, single-use disposables and the provision of support services to our customers with the goal of supporting the advancement of our customers’ cell-therapies and/or drug or biologic discovery activities.
Our offerings include products such as instruments, single-use PAs and the provision of support services to our customers with the goal of supporting the advancement of our customers’ cell therapies and/or drug or biologic discovery activities.
Under these escrow agreements, the know-how and source code to the applicable product may be released to the customer, typically for its use to further develop, maintain, modify and enhance the product, upon the occurrence of specified events, such as our filing for bankruptcy and breaching our representations, warranties or covenants of our agreements with our customers.
Under these escrow agreements, the know-how and source code to the applicable product may be 64 Table of Contents released to the customer, typically for its use to further develop, maintain, modify and enhance the product, upon the occurrence of specified events, such as our filing for bankruptcy and breaching our representations, warranties or covenants of our agreements with our customers.
If we are unable to identify and fix defects or other problems, we could experience, among other things: • product recalls and replacement costs; • loss of customers or orders; • damage to our brand reputation; • failure to attract new customers; • diversion of development, engineering and manufacturing resources; • regulatory actions by governmental authorities; and • legal actions by our customers.
If we are unable to identify and fix defects or other problems, we could experience, among other things: • product recalls and replacement costs; • loss of customers or orders; • damage to our brand reputation; 45 Table of Contents • failure to attract new customers; • diversion of development, engineering and manufacturing resources; • regulatory actions by governmental authorities; and • legal actions by our customers.
With or without insurance, damage to our manufacturing facility or our other property, or to any of our suppliers, due to fire, flood or other natural disaster or casualty event may have a material adverse effect on our business, financial condition and results of operations. We may face exposure to foreign currency exchange rate fluctuations.
With or without insurance, damage to our manufacturing facility or our other property, or to any of our suppliers, due to fire, flood or other natural disaster or casualty event may have a material adverse effect on our business, financial condition and results of operations. 62 Table of Contents We may face exposure to foreign currency exchange rate fluctuations.
In addition, negotiations for acquisitions, collaborations or investments that are not ultimately consummated could result in significant diversion of management time, as well as substantial out-of-pocket costs, any of which could have a material adverse effect on our business, operating results and financial condition.
In addition, negotiations for acquisitions, collaborations or investments that are not ultimately consummated could result in significant diversion of management time, as well as 41 Table of Contents substantial out-of-pocket costs, any of which could have a material adverse effect on our business, operating results and financial condition.
If we choose to scale the commercial production of our PA and increase our manufacturing capacity, we may encounter quality issues that could 41 Table of Contents result in product defects, errors or recalls. Manufacturing delays related to quality control could negatively impact our ability to bring our PAs to market, harm our reputation and decrease our revenue.
If we choose to scale the commercial production of our PA and increase our manufacturing capacity, we may encounter quality issues that could result in product defects, errors or recalls. Manufacturing delays related to quality control could negatively impact our ability to bring our PAs to market, harm our reputation and decrease our revenue.
In response to COVID-19 in 2020, we temporarily closed our headquarters and other offices, and our employees and contractors who were able to perform their duties remotely continue to do so. We also implemented travel restrictions and other significant changes in how we operate our business. The operations of our partners and customers were likewise altered.
For example, in response to COVID-19 in 2020, we temporarily closed our headquarters and other offices, and our employees and contractors who were able to perform their duties remotely continue to do so. We also implemented travel restrictions and other significant changes in how we operate our business. The operations of our customers were likewise altered.
Domestic and international equity and debt markets experienced in 2022 and 2023, and may continue to experience, heightened volatility and turmoil, including, among other things, severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, supply chain shortages, increases in inflation rates, higher interest rates and uncertainty about economic stability.
Recently, domestic and international equity and debt markets experienced, and may continue to experience, heightened volatility and turmoil, including, among other things, severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, supply chain shortages, increases in inflation rates, higher interest rates and uncertainty about economic stability.
In such circumstances, we may not generate any substantial revenues from such a collaboration in the form of milestone payments, royalties or otherwise. Speculation in the industry about our existing or potential partnerships can be a catalyst for adverse speculation about us which can adversely affect our reputation and our business.
In such circumstances, we may not generate any substantial revenues from such a collaboration in the form of milestone payments, royalties or otherwise. Speculation in the industry about our existing or potential SPL customers can be a catalyst for adverse speculation about us which can adversely affect our reputation and our business.
Although our partners have historically been able to reference our FDA Master File in the United States and our Master and Technical Files in some other countries in the course of clinical development of their therapeutic products, we cannot ensure that we will obtain or establish a regulatory Master or Technical File in other countries.
Although our SPL customers have historically been able to reference our FDA Master File in the United States and our Master and Technical Files in some other countries in the course of clinical development of their therapeutic products, we cannot ensure that we will obtain or establish a regulatory Master or Technical File in other countries.
Our growth is subject to many factors, including our success in implementing our business strategy, which is subject to many risks and uncertainties. 28 Table of Contents We rely on assumptions, estimates and data to calculate certain of our key metrics, and real or perceived inaccuracies in such metrics may harm our reputation and negatively affect our business.
Our growth is subject to many factors, including our success in implementing our business strategy, which is subject to many risks and uncertainties. We rely on assumptions, estimates and data to calculate certain of our key metrics, and real or perceived inaccuracies in such metrics may harm our reputation and negatively affect our business.
Broad market and industry fluctuations, as well as general economic, political, regulatory and market conditions, may also negatively impact the market price of our common stock. 65 Table of Contents If securities or industry analysts do not publish research, or publish inaccurate or unfavorable research, about our business, the price of our common stock and our trading volume could decline.
Broad market and industry fluctuations, as well as general economic, political, regulatory and market conditions, may also negatively impact the market price of our common stock. If securities or industry analysts do not publish research, or publish inaccurate or unfavorable research, about our business, the price of our common stock and our trading volume could decline.
If these third-party distributors do not provide a high-quality customer experience, our business operations and reputation may suffer. If we cannot maintain and expand current partnerships and enter into new partnerships that generate marketed licensed products, our business could be adversely affected.
If these third-party distributors do not provide a high-quality customer experience, our business operations and reputation may suffer. If we cannot maintain and expand current SPL agreements and enter into new agreements that generate marketed licensed products, our business could be adversely affected.
If we are unable to hire, develop and retain talented sales personnel or if new sales personnel are unable to achieve desired productivity levels in a reasonable period of time, we may not be able to realize the expected benefits of this investment or increase our revenue.
If we are unable to hire, 46 Table of Contents develop and retain talented sales personnel or if new sales personnel are unable to achieve desired productivity levels in a reasonable period of time, we may not be able to realize the expected benefits of this investment or increase our revenue.
Remote work has become more common and also poses increased risks to our information technology systems and data, as more of our employees utilize network connections, computers and devices outside our premises or network, including working at home, while in transit and in public locations.
Remote work has become more common and also poses increased risks to our information technology systems and data, as more of our employees utilize network connections, computers and devices outside our premises or network, including working at 56 Table of Contents home, while in transit and in public locations.
Our operating results may fluctuate substantially due to the potential changes in our customers' resources as described above. Any decrease in our customers’ budgets or expenditures, or in the size, scope or frequency of their capital or operating expenditures, could materially and adversely affect our business, operating results and financial condition.
Our operating results may fluctuate substantially due to the potential changes in our customers' resources as described above. Any decrease in our customers’ budgets or expenditures, or in the size, scope or frequency of their 33 Table of Contents capital or operating expenditures, could materially and adversely affect our business, operating results and financial condition.
In addition, if partners choose to announce a collaboration with us or their progress, there is no guarantee that we will concurrently recognize any fees or that such announcement will be indicative of future fees to us, as such fees are not due to us until our partner reaches certain specific activities or clinical progress events, for example IND submissions or start of pivotal trials.
In addition, if customers choose to announce a collaboration with us or their progress, there is no guarantee that we will concurrently recognize any fees or that such announcement will be indicative of future fees to us, as such fees are not due to us until our partner reaches certain specific activities or clinical progress events, such as IND submissions or start of pivotal trials.
As a result of the technological complexity of our systems, changes 44 Table of Contents in our suppliers’ manufacturing processes or the inadvertent use of defective materials by us or our suppliers could result in a product recall, or an adverse effect on our ability to achieve acceptable manufacturing quality and product reliability.
As a result of the technological complexity of our systems, changes in our suppliers’ manufacturing processes or the inadvertent use of defective materials by us or our suppliers could result in a product recall, or an adverse effect on our ability to achieve acceptable manufacturing quality and product reliability.
We currently compete with both established and early-stage life sciences technologies companies that design, 30 Table of Contents manufacture and market electroporation and other non-viral cell engineering technology based on efficacy, price, ease of use, reimbursement and customer support services.
We currently compete with both established and early-stage life sciences technologies companies that design, manufacture and market electroporation and other non-viral cell engineering technology based on efficacy, price, ease of use, reimbursement and customer support services.
Pursuant to Section 107 of the JOBS Act, as an emerging growth company, we have elected to use the extended transition period for complying with new or revised accounting standards until those standards would otherwise apply to private companies.
Pursuant to Section 107 of the JOBS Act, as an emerging growth company, we have elected to use the extended transition period 67 Table of Contents for complying with new or revised accounting standards until those standards would otherwise apply to private companies.
We aim to provide our customers with a single, integrated platform to discover, develop and 42 Table of Contents manufacture safer, more targeted and increasingly complex cell-based therapies, designed for integration into customers’ current good manufacturing practices environments. We cannot guarantee that the market for our current products will continue to generate significant or consistent demand.
We aim to provide our customers with a single, integrated platform to discover, develop and manufacture safer, more targeted and increasingly complex cell-based therapies, designed for integration into customers’ current good manufacturing practices environments. We cannot guarantee that the market for our current products will continue to generate significant or consistent demand.
We currently sell and license our products primarily in the cell therapy market, which is characterized by significant enhancements and evolving industry and regulatory standards and a high degree of regulatory scrutiny. As a result, our customers’ needs are rapidly evolving.
We currently sell and license our products primarily in the cell therapy market, which is characterized by significant enhancements and evolving industry and regulatory standards and a high degree of regulatory scrutiny. As a result, our 44 Table of Contents customers’ needs are rapidly evolving.
If unacceptable side effects or deaths arise in the development of our customers’ product candidates, the Institutional Review Boards at the institutions in which their studies are conducted, the FDA or any comparable foreign regulatory authority could suspend or terminate our customers’ clinical trials or the FDA or other regulatory authorities could order them to cease clinical trials or deny approval of their product candidates for any or all targeted indications.
If unacceptable side effects or deaths arise in the development of our customers’ product candidates, the IRBs at the institutions in which their studies are conducted, the FDA or any comparable foreign regulatory authority could suspend or terminate our customers’ clinical trials or the FDA or other regulatory authorities could order them to cease clinical trials or deny approval of their product candidates for any or all targeted indications.
One of the components of our growth strategy is to sell our recently launched ExPERT VLx platform for large-scale bioprocessing applications, including viral vector production in suspension cell cultures and rapid production of proteins, 27 Table of Contents including monoclonal antibodies.
One of the components of our growth strategy is to sell our recently launched ExPERT VLx platform for large-scale bioprocessing applications, including viral vector production in suspension cell cultures and rapid production of proteins, including monoclonal antibodies.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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We recognize the importance of assessing, identifying, and managing material risks associated with cybersecurity threats and cybersecurity incidents, as such terms are defined in Item 106(a) of Regulation S-K. Our exposure to applicable cybersecurity risks is described more fully under the Risk Factors in Item 1A in this annual report on Form 10-K.
We recognize the importance of assessing, identifying, and managing material risks associated with cybersecurity threats and cybersecurity incidents, as such terms 70 Table of Contents are defined in Item 106(a) of Regulation S-K. Our exposure to applicable cybersecurity risks is described more fully under the Risk Factors in Item 1A in this annual report on Form 10-K.
In addition to antivirus endpoint protection on Company devices, our IT MSP 70 Table of Contents also, for example, monitors IT system metadata around suspicious events, evidence of tactics, tools, or procedures used by attackers, and monitors remote privileged activity.
In addition to antivirus endpoint protection on Company devices, our IT MSP also, for example, monitors IT system metadata around suspicious events, evidence of tactics, tools, or procedures used by attackers, and monitors remote privileged activity. We engaged a third party to perform a cybersecurity audits in 2021 and in the fourth quarter of 2024.
Our management team has also established a Cybersecurity Incident Response Team (the “CSIRT”), which is comprised of our Chief Executive Officer, the Chair of the Audit Committee of our Board, our General Counsel, our Chief Administrative Officer, and our Senior Vice President of Human Resources. The CSIRT is also responsible for responding to cybersecurity incidents.
These individuals are responsible for coordinating resources internally and externally regarding cybersecurity risk management and incident response, and they report directly to our Chief Administrative Officer. 71 Table of Contents Our management team has also established a Cybersecurity Incident Response Team (the “CSIRT”), which is comprised of our Chief Executive Officer, the Chair of the Audit Committee of our Board, our General Counsel, our Chief Administrative Officer, and our Senior Vice President of Human Resources.
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We engaged a third party to perform a cybersecurity audit in the fourth quarter of 2021 and intend to undertake another cybersecurity audit in the third quarter of 2024.
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The CSIRT is also responsible for responding to cybersecurity incidents.
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These individuals are responsible for coordinating resources internally and externally regarding cybersecurity risk management and incident response, and they report directly to our Chief Administrative Officer.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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We are not currently a party to any material legal proceedings, and we are not aware of any pending or threatened legal 71 Table of Contents proceedings against us that we believe will have, individually or in the aggregate, a material adverse effect on our business, financial condition or results of operations. Item 4. Mine Safety Disclosures.
We are not currently a party to any material legal proceedings, and we are not aware of any pending or threatened legal proceedings against us that we believe will have, individually or in the aggregate, a material adverse effect on our business, financial condition or results of operations. Item 4. Mine Safety Disclosures.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Since 2016, our common stock has traded on AIM, and currently trades on AIM under the symbol “MXCT.” ​ Holders of Our Common Stock ​ As of March 5, 2024, there were approximately 35 holders of record of our common stock.
Since 2016, our common stock has traded on AIM, and currently trades on AIM under the symbol “MXCT.” ​ Holders of Our Common Stock ​ As of March 7, 2025, there were approximately 29 holders of record of our common stock.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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We expect to continue to incur net losses as we focus on growing commercial sales of our products in both the United States and international markets, including growing our sales teams, scaling our manufacturing operations, continuing research and development efforts to develop new products and further enhance our existing products.
We expect to continue to incur net losses as we focus on growing commercial sales of our products in both the United States and international markets, including growing our sales teams, scaling our manufacturing operations, and continuing research and development efforts to develop new products and further enhance our existing products.
We expect our gross margins to benefit from realization of the economics from our SPL partnership agreements described above, to the extent that such milestones and/or sales-based payments grow to be a significant proportion of overall revenues, as there is no cost of goods sold associated with such revenue. However, realization of these potential revenues is uncertain.
We expect our gross margins to benefit from realization of the economics from our SPL agreements described above, to the extent that such milestones and/or sales-based payments grow to be a significant proportion of overall revenues, as there is no cost of goods sold associated with such revenue. However, realization of these potential revenues is uncertain.
We have recorded a full valuation allowance against our net deferred tax assets at each balance sheet date since, due to our history of net losses, we have determined that it is not currently more likely than not that our net deferred tax assets are recoverable. 82 Table of Contents Results of Operations Comparison of the Years Ended December 31, 2023 and 2022 The results of operations presented below should be reviewed in conjunction with the consolidated financial statements and notes included elsewhere in this Annual Report.
We have recorded a full valuation allowance against our net deferred tax assets at each balance sheet date since, due to our history of net losses, we have determined that it is currently more likely than not that our net deferred tax assets are not recoverable. 82 Table of Contents Results of Operations Comparison of the Years Ended December 31, 2024 and 2023 The results of operations presented below should be reviewed in conjunction with the consolidated financial statements and notes included elsewhere in this Annual Report.
Customers purchase an ATx, STx, GTx or VLx depending upon their intended use and all customers purchase PAs for use with our instruments. Commercial customers may not use a purchased instrument for clinical or commercial processes.
Customers purchase an ATx, STx, GTx or VLx depending upon their intended use and all customers purchase PAs and consumables for use with our instruments. Commercial customers may not use a purchased instrument for clinical or commercial processes.
Other Income (Expense) Interest income includes interest earned on cash balances in our cash accounts and interest earned on money market funds, commercial paper and corporate bonds as well as miscellaneous income unrelated to our core operations.
Other Income Interest income includes interest earned on cash balances in our cash accounts and interest earned on money market funds, commercial paper and corporate bonds as well as miscellaneous income unrelated to our core operations.
Our ability to successfully address the factors below is subject to various risks and uncertainties, including those described in this Annual Report under the heading “Risk Factors.” Sales and Leases of Instruments Our financial performance has largely been driven by, and in the future will continue to be impacted by, the rate of sales and leases of our ExPERT family of proprietary Flow Electroporation instruments to existing and new customers.
Our ability to successfully address the factors below is subject to various risks and uncertainties, including those described in this Annual Report under the heading “Risk Factors.” Sales and Licenses of Instruments Our financial performance has largely been driven by, and in the future will continue to be impacted by, the rate of sales and licenses of our ExPERT family of proprietary Flow Electroporation instruments to existing and new customers.
It is possible, however, that our future lease revenue could be impacted by failure of the customer therapeutic candidates to progress through clinical development for reasons unrelated to the successful use of our instruments, such as toxicity, lack of efficacy, funding constraints, changes in development priorities, patient access limitations or regulatory challenges.
It is possible, however, that our future license revenue could be impacted by failure of the customer therapeutic candidates to progress through clinical development for reasons unrelated to the successful use of our instruments, such as toxicity, lack of efficacy, funding constraints, changes in development priorities, patient access limitations or regulatory challenges.
Our customers typically negotiate the terms of those licenses during research and preclinical development. We refer to these arrangements as SPL partnerships, the terms of which contain not only higher annual, non-exclusive fees for the clinical use of the instrument, but also allow us to share in the economics of the customer’s programs.
Our customers typically negotiate the terms of those licenses during research and preclinical development. We refer to these arrangements as SPL agreements, the terms of which contain not only higher annual, non-exclusive fees for the clinical use of the instrument, but also allow us to share in the economics of the customer’s programs.
In addition, part of our growth strategy is to expand into new regional markets, which could require the use of distributors and/or our participation in more competitive environments, which could impact our ability to price our instruments at a premium and could negatively impact our ability to enter into SPL partnerships on terms similar to those currently in effect.
In addition, part of our growth strategy is to expand into new regional markets, which could require the use of distributors and/or our participation in more competitive environments, which could impact our ability to price our instruments at a premium and could negatively impact our ability to enter into SPL agreements on terms similar to those currently in effect.
Strategic Platform Licenses (SPLs) Typically, our cell therapy customers will either purchase our ATx instrument for research purposes or purchase or obtain a research use license under lease of our GTx instrument technology in order to validate the use of our technology in their programs and to progress their preclinical work towards clinic trials.
Strategic Platform Licenses (SPLs) Typically, our cell therapy customers will either purchase our ATx instrument for research purposes or purchase or obtain a research use license of our GTx instrument technology in order to validate the use of our technology in their programs and to progress their preclinical work towards clinic trials.
Our future milestone revenue under our SPL partnerships will depend in large part on the clinical and regulatory achievements of our customers. Generally, precommercial milestone payments become larger as programs move through clinical development. We rely in part on our customers’ public disclosures around regulatory timelines to forecast our receipt of precommercial milestone payments.
Our future milestone revenue under our SPL agreements will depend in large part on the clinical and regulatory achievements of our customers. Generally, precommercial milestone payments become larger as programs move through clinical development. We rely in part on our customers’ public disclosures around regulatory timelines to forecast our receipt of precommercial milestone payments.
To achieve this goal, we intend to further expand our commercial infrastructure, including through the expansion of our sales force and field application scientists. We have expanded our sales force and field application scientist count over the past several years and now have over 36 dedicated field sales and application scientist professionals globally.
To achieve this goal, we intend to further expand our commercial infrastructure, including through the expansion of our sales force and field application scientists. We have expanded our sales force and field application scientist count over the past several years and now have over 33 dedicated field sales and application scientist professionals globally.
SPL partnerships typically include potential payments to us upon the customer’s achievement of specified clinical development or regulatory milestones, as well as potential sales-based payments to us, which could be payments based upon the achievement of specified sales levels and/or royalty payments that are a percentage of the customer’s net sales.
SPL agreements typically include potential payments to us upon the customer’s achievement of specified clinical development or regulatory milestones, as well as potential sales-based payments to us, which could be payments based upon the achievement of specified sales levels and/or royalty payments that are a percentage of the customer’s net sales.
Operating Expenses Research and Development Research and development expenses consist primarily of costs incurred for our research activities related to advancing our technology and development of applications for our technology, including research into specific applications and associated data development, process development, product development (e.g., development of instruments and disposables, including hardware and software engineering) and design and other costs not directly charged to inventory or cost of goods sold, such as supply chain development and design and management of quality systems.
Operating Expenses Research and Development Research and development expenses consist primarily of costs incurred for our research activities related to advancing our technology and development of applications for our technology, including research into specific applications and associated data development, process development, product development (e.g., development of instruments and PAs and consumables, including hardware and software engineering) and design and other costs not directly charged to inventory or cost of goods sold, such as supply chain development and design and management of quality systems.
The ExPERT family of products includes four instruments, which we call the ATx, STx, GTx and VLx, and related software protocols, as well as a portfolio of proprietary related disposables and consumables. We launched the VLx instrument in September 2022.
The ExPERT family of products includes four instruments, which we call the ATx, STx, GTx and VLx, and related software protocols, as well as a portfolio of proprietary related PAs and consumables. We launched the VLx instrument in September 2022.
Recent Accounting Pronouncements A description of recently issued accounting pronouncements that may potentially impact our financial position, results of operations or cash flows is disclosed in Note 2 to our consolidated financial statements in this Annual Report. Emerging Growth Company Status We are an “emerging growth company,” or EGC, under the JOBS Act.
Recent Accounting Pronouncements A description of recently issued accounting pronouncements that may potentially impact our financial position, results of operations or cash flows is disclosed in Note 2 to our consolidated financial statements in this Annual Report. ​ 88 Table of Contents Emerging Growth Company Status We are an “emerging growth company,” or EGC, under the JOBS Act.
Cost of Goods Sold Cost of goods sold primarily consists of costs for raw material parts, contract manufacturer costs, salaries, overhead, other direct costs related to sales recognized as revenue in the period, and leased equipment depreciation.
Cost of Goods Sold Cost of goods sold primarily consists of costs for raw material parts, contract manufacturer costs, salaries, overhead, other direct costs related to sales recognized as revenue in the period, and licensed equipment depreciation.
Therefore, depending on the number of instruments that have been sold or are under active lease, we have insight into the demand for PAs that will also translate to future revenue for us.
Therefore, depending on the number of instruments that have been sold or are under active license, we have insight into the demand for PAs that will also translate to future revenue for us.
The sales cycle for our cell engineering instruments varies widely and typically ranges from approximately six to approximately 12 months, with the actual period depending on project stage, budget process, equipment prioritization 75 Table of Contents and the general financial status of the customer or the market in general.
The sales cycle for our cell engineering instruments varies widely and typically ranges from approximately six to approximately 12 months, with the actual period depending on project stage, budget process, equipment prioritization and the general financial status of the customer or the market in general.
The STx is primarily sold to end users for research and drug discovery purposes, and the GTx is leased to customers for research, clinical or commercial use or sold for research use in certain circumstances or sold to academic centers for research or clinical use.
The STx is primarily sold to end users for research and drug discovery purposes, and the GTx is licensed to customers for research, clinical or commercial use or sold for research use in certain circumstances or sold to academic centers for research or clinical use.
Our future funding requirements will depend on many factors, including: • transaction and capital expenditures necessitated by strategic activities; • market acceptance of our products; • the cost and timing of establishing additional sales, marketing and distribution capabilities; • the cost of our research and development activities and successful development of data supporting use of our products for new applications, and timely launch of new features and products; • sales to existing and new customers and the progress of our SPL partners in developing their pipelines of product candidates; • our ability to enter into additional SPL partnerships and licenses for clinical use of our platform in the future; • changes in the amount of capital available to existing and emerging customers in our target markets; 86 Table of Contents • the effect of competing technological and market developments; and • the level of our selling, general and administrative expenses.
Our future funding requirements will depend on many factors, including: • transaction and capital expenditures necessitated by strategic activities; • market acceptance of our products; • the cost and timing of establishing additional sales, marketing and distribution capabilities; • the cost of our research and development activities and successful development of data supporting use of our products for new applications, and timely launch of new features and products; • sales to existing and new customers and the progress of our SPL customers in developing their pipelines of product candidates; • our ability to enter into additional SPL agreements and licenses for clinical use of our platform in the future; • changes in the amount of capital available to existing and emerging customers in our target markets; • the effect of competing technological and market developments; and • the level of our selling, general and administrative expenses.
We view the demand for our instruments, whether in the form of sales or leases, as an indicator of the health of our current business and as a predictor of future instrument sale and lease revenue. As described below, we separately sell proprietary single-use disposables, which we call PAs, that are necessary for our customers to use our electroporation instruments.
We view the demand for our instruments, whether in the form of sales or license, as an indicator of the health of our current business and as a predictor of future instrument sale and license revenue. As described below, we separately sell proprietary single-use PAs, which we call PAs, that are necessary for our customers to use our electroporation instruments.
We also provide scientific and regulatory support to our clinical use licensees to help them improve process optimization and facilitate their regulatory submission process. We expect leased elements revenue to increase in future periods as our market and customer base grow.
We also provide scientific and regulatory support to our clinical use licensees to help them improve process optimization and facilitate their regulatory submission process. We expect license revenue to increase in future periods as our market and customer base grow.
We expect that our cost of goods sold will increase or decrease primarily to the extent that our instrument and disposables revenue increases and decreases. Gross Profit and Gross Margin Gross profit is calculated as revenue less cost of goods sold. Gross margin is gross profit expressed as a percentage of revenue.
We expect that our cost of goods sold will increase or decrease primarily to the extent that our instrument and PA and consumable revenue increases and decreases. Gross Profit and Gross Margin Gross profit is calculated as revenue less cost of goods sold. Gross margin is gross profit expressed as a percentage of revenue.
We measure stock-based compensation expense on the 89 Table of Contents date of grant and recognize the corresponding compensation expense of those awards over the requisite service period, which is generally the vesting period of the respective award. We record forfeitures as they occur.
We measure stock-based compensation expense on the date of grant and recognize the corresponding compensation expense of those awards over the requisite service period, which is generally the vesting period of the respective award. We record forfeitures as they occur.
Our gross profit in future periods will depend on a variety of factors, including sales mix among instruments, disposables and milestones, the specific mix among types of instruments or disposables, the proportion of revenues associated with instrument leases as opposed to sales, the share of revenues composed of milestones, changes in the costs to produce our various products, the launch of new products or changes in existing products, our cost structure for manufacturing including changes in production volumes, the proportion of sales made through third-party distributors, and the pricing of our products which may be impacted by market conditions.
Our gross profit in future periods will depend on a variety of factors, including sales mix among instruments, PAs, consumables and milestones, the specific mix among types of instruments or PAs, the proportion of revenues associated with licenses as opposed to sales, the share of revenues composed of milestones, changes in the costs to produce our various products, the launch of new products or changes in existing products, our cost structure for manufacturing including changes in production volumes, the proportion of sales made through third-party distributors, and the pricing of our products which may be impacted by market conditions.
Sales of Processing Assemblies In addition to instrument sales, our current and future revenue is dependent on sales of our proprietary PAs, as well as the sale of our proprietary electroporation buffer solution, for use with our instruments. We sell PAs that are intended either to support research use or use in cGMP clinical research applications.
Sales of Processing Assemblies and Consumables In addition to instrument sales, our current and future revenue is dependent on sales of our proprietary PAs, as well as the sale of our proprietary consumables, for use with our instruments. We sell PAs that are intended either to support research use or use in cGMP clinical research applications.
These key metrics include: 78 Table of Contents • the number of cumulative instruments that we have placed with our customers, either by sale or lease, which we refer to as our installed base and consider to be an indication of our traction within the non-viral delivery market and other markets and indicative of the potential future recurring revenue generated from those instruments, including disposables and annual fees; • the number of active (customers with rights to develop one or more clinical programs) SPL partnerships that we have entered into with cell therapy developers, as well as the total number of our customers’ clinical programs, whether active or contemplated, that are covered by such active SPL partnerships and the percentage of those clinical programs that are under an active IND application (or foreign equivalent), meaning that the customer is cleared to commence clinical trials; • the aggregate potential precommercial milestone payments under active SPL partnerships, representing the maximum potential milestone payments to us if all programs covered by each SPL partnership were to achieve regulatory approval; • the aggregate number of potential programs licensed for clinical use, whether active or contemplated, that are covered by our SPL partnerships; and • the aggregate number of programs licensed for clinical use and covered by our SPL partnerships that are currently in clinical development.
These key metrics include: • the number of cumulative instruments that we have placed with our customers, either by sale or license, which we refer to as our installed base and consider to be an indication of our traction within the non-viral delivery market and other markets and indicative of the potential future recurring revenue generated from those instruments, including PAs and annual fees; • the number of existing (customers with rights to develop one or more clinical programs) SPL agreements that we have entered into with cell therapy developers, as well as the total number of our customers’ clinical programs, whether active or contemplated, that are covered by such existing SPL agreements and the percentage of those clinical programs that are under an active IND application (or foreign equivalent), meaning that the customer is cleared to commence clinical trials; • the aggregate potential precommercial milestone payments under SPL agreements, representing the maximum potential milestone payments to us if all programs covered by each SPL agreements were to achieve regulatory approval; • the aggregate number of potential programs licensed for clinical use, whether active or contemplated, that are covered by our SPL agreements; and • the aggregate number of programs licensed for clinical use and covered by our SPL agreements that are currently in clinical development.
We believe we have a diversified revenue model with revenue generated from multiple sources including instrument leases with recurring license fees, sales of instruments and related disposables and participation in the clinical and commercial success of some of our customers through milestone and sales-based payments under SPL agreements.
We believe we have a diversified revenue model with revenue generated from multiple sources including recurring license fees, sales of instruments and related PAs and participation in the clinical and commercial success of some of our customers through milestone and sales-based payments under SPL agreements.
This number may fluctuate due to the success of our commercial partners. Additionally, the addition of a large SPL partnership in which one SPL partner uses multiple instruments as part of their research, clinical or commercial program, may dilute the percentage of commercial programs currently in the clinic.
This number may fluctuate due to the success of our commercial partners. Additionally, the addition of a large SPL agreement in which one SPL customer uses multiple instruments as part of their research, clinical or commercial program, may dilute the percentage of commercial programs currently in the clinic.
As of December 31, 2023, we had U.S. net operating loss carryforwards of $88.9 million, which may be available to offset future taxable income and begin to expire in 2025, as well as net operating losses in the various states in which we file.
As of December 31, 2024, we had U.S. net operating loss carryforwards of $109.9 million, which may be available to offset future taxable income and begin to expire in 2025, as well as net operating losses in the various states in which we file.
Under our instrument lease arrangements, we lease our instruments to customers and provide associated software licenses to allow customers non-exclusive use of our technology for research and/or specific clinical programs, typically along with rights for commercial use upon regulatory approval of the customer's products.
Under our research and clinical licenses, we provide our instruments and associated software to customers for non-exclusive use of our technology for research and/or specific clinical programs, typically along with rights for commercial use upon regulatory approval of the customer's products.
We recognize revenue from the sale of extended warranty and service plans over the respective coverage period, which approximates the service effort provided by us. Warranties are typically not a material revenue stream for us. Product Sales Revenue from contracts with customers includes revenue from the sale of instruments, PAs and buffers.
We recognize revenue from the sale of extended warranty and service plans over the respective coverage period, which approximates the service effort provided by us. Warranties are typically not a material revenue stream for us and included in other revenue. Product Sales Revenue from contracts with customers includes revenue from the sale of instruments, PAs and consumables.
We record revenue from the sale of instruments or PAs upon shipment to a customer. Instrument leases are typically invoiced annually at the start of each instrument license period and are accounted for as monthly revenue over the lease term with the expectation of continuing customer renewals of their instrument leases.
We record revenue from the sale of instruments, PAs or consumables upon shipment to a customer. Licenses are typically invoiced annually at the start of each license period and are accounted for as monthly revenue over the license term with the expectation of continuing customer renewals of their licenses.
Further, each agreement typically includes programs that have not been specifically identified, or for which a candidate may never be identified or developed by the customer. Our strategy is to capitalize on the growth in the number of cell therapy developers by entering into new SPL partnerships.
Further, each agreement typically includes programs that have not been specifically identified, or for which a candidate may never be identified or developed by the customer. Our strategy is to capitalize on the growth in the number of cell therapy developers by entering into new SPL agreements. We entered into six agreements in 2024.
We plan to further grow our installed base of ExPERT instruments through additional sales and leases to our current customers and through the sale or lease of instruments to new cell therapy, product discovery, academic and other customers.
We plan to further grow our installed base of ExPERT instruments through additional sales and licenses to our current customers and through the sale or license of instruments to new cell therapy, product discovery, academic and other customers.
Our ability to generate revenue sufficient to achieve profitability will depend on the successful further development and commercialization of our products. We generated revenue of $41.3 million and $44.3 million for the years ended December 31, 2023 and 2022, respectively, and incurred net losses of $37.9 million and $23.6 million for those same years.
Our ability to generate revenue sufficient to achieve profitability will depend on the successful further development and commercialization of our products. We generated revenue of $38.6 million and $41.3 million for the years ended December 31, 2024 and 2023, respectively, and incurred net losses of $41.1 million and $37.9 million for those same years.
Our SPL partnerships also include associated clinical progress milestones and sales-based payments to us, in addition to annual lease payments. Sales of instruments and disposables under contracts with customers are classified as product sales in our consolidated financial statements.
Our SPL agreements also include associated clinical progress milestones and sales-based payments to us, in addition to annual license payments. Sales of instruments and PAs under contracts with customers are classified as product sales in our consolidated financial statements.
As our customers achieve clinical progress milestones and/or sales-based payment milestones, we recognize the full value of the milestone as revenue. In addition, as customers use instruments they have either purchased or leased, they typically replenish their supplies of disposables through recurring purchases.
As our customers achieve clinical progress milestones and/or sales-based payment milestones, we recognize the full value of the milestone as revenue. In addition, as customers use instruments they have either purchased or included with their license, they typically replenish their supplies of PAs and consumables through recurring purchases.
The amount of each milestone payment is typically correlated in size with value-creating, precommercial clinical progress events or commercial sales levels. Of the over 160 programs associated with our current SPLs, one is in commercial stage, and 16 of those programs are currently active in clinical development, meaning they have at least an FDA-cleared IND application or foreign equivalent.
The amount of each milestone payment is typically correlated in size with value-creating, precommercial clinical progress events or commercial sales levels. Under our current SPLs, one program is in commercial stage, and 18 programs are currently in clinical development, meaning they have at least an FDA-cleared IND application or foreign equivalent.
This license fee varies based on whether the instrument is being used for preclinical or clinical purposes. Once we have leased an instrument to a customer, we generally have high visibility into future lease revenue from this customer.
This license fee varies based on whether the instrument is being used for preclinical or clinical purposes. Once we have a research or clinical license with a customer, we generally have high visibility into future license revenue from this customer.
Gross Margins We have generated overall gross margins of nearly 90% for the last six years, although our margins vary depending on our revenue mix from instruments, PAs and milestones under SPL partnerships and other factors.
Gross Margins We have generated overall gross margins of over 80% for the last six years, although our margins vary depending on our revenue mix from instruments, PAs and milestones under SPL agreements and other factors.
For any of these reasons, a customer could determine not to renew or to enter into additional instrument leases with us, which could result in our actual future lease revenues differing from our estimates and projections. Our installed base of electroporation instruments has grown to over 680 instruments as of December 31, 2023.
For any of these reasons, a customer could determine not to renew or to enter into additional licenses with us, which could result in our actual future license revenues differing from our estimates and projections. Our installed base of electroporation instruments has grown to over 760 instruments as of December 31, 2024.
However, our actual milestone revenue from these agreements will likely be considerably lower than this amount, as not all programs covered by each agreement will become and remain active programs in a 77 Table of Contents customer’s development pipeline or successfully complete the clinical development process.
However, our actual milestone revenue from these agreements will likely be lower, as not all programs covered by each agreement will become and remain active programs in a customer’s development pipeline or successfully complete the clinical development process.
We expect revenue from instruments leased to cell therapy customers to continue to grow as those customers move their existing drug or biologic development programs into later-stage clinical trials and advance their preclinical pipeline programs into clinical development.
We expect license revenue to continue to grow as those customers move their existing drug or biologic development programs into later-stage clinical trials and advance their preclinical pipeline programs into clinical development.
The increase was primarily driven by increases in leasehold improvements and investments in laboratory equipment and consignment instruments.
The increase was primarily driven by investments in laboratory equipment and consignment instruments.
We also had net cash outflows of $3.2 million due to net changes in our operating assets and liabilities.
We also had net cash outflows of $0.7 million due to net changes in our operating assets and liabilities.
For the year ended December 31, 2023, two cell therapy companies with which we have entered into an SPL accounted for 39% of our total revenue, and our five largest SPL partners accounted for an aggregate of approximately 52% of our total revenue for the year through a combination of instrument license fees, milestones realized and processing assembly revenue.
For the year ended December 31, 2024, two cell therapy companies with which we have entered into an SPL agreement accounted for 32% of our total revenue, and our five largest SPL customers accounted for an aggregate of approximately 46% of our total revenue for the year through a combination of instrument license fees, milestones realized and processing assembly revenue.
Based on our current business plan, we believe that our existing cash, cash equivalents, short-term investments and internally generated cash flows will enable us to fund our operating expenses and capital expenditure requirements for at least the next 12 months.
Based on our current business plan, we believe that our existing cash, cash equivalents, short-term investments and internally generated cash flows will enable us to fund our operating expenses and capital expenditure requirements for at least the next 12 months. We expect to end 2025 with approximately $160 million in total cash, cash equivalents and investments.
Revenue from instrument leases, including payments that we may receive from our customers based on their achievement of specified clinical development or commercialization milestones, are classified as leased elements in our consolidated financial statements. Our business and revenue growth strategy currently consists of the sale or lease of instruments and the sale of disposables.
Revenue from SPLs, including payments that we may receive from our customers based on their achievement of specified clinical development or commercialization milestones, are classified as leased elements in our consolidated financial statements. Our business and revenue growth strategy currently consists of the sale or instruments, the sale of PAs and consumables, and SPL license fees.
To date, we have funded our operations primarily with proceeds from sales of common stock, borrowings under loan agreements and cash flows associated with sales and licenses of our products to customers. On August 3, 2021, we completed our U.S. IPO, generating gross proceeds of $201.8 million.
As of December 31, 2024, we had an accumulated deficit of $216.9 million. To date, we have funded our operations primarily with proceeds from sales of common stock, borrowings under loan agreements and cash flows associated with sales and licenses of our products to customers. On August 3, 2021, we completed our U.S. IPO, generating gross proceeds of $201.8 million.
Although customers are not contractually obligated to renew their instrument leases or to purchase additional disposables and may decide not to do so solely in their own discretion, leased instruments and disposables revenue streams have historically formed an important component of our revenues, and we believe they provide insight into our future performance.
Although customers are not contractually obligated to renew their licenses or to purchase additional PAs or consumables and may decide not to do so solely in their own discretion, license fees and PAs and consumable revenue streams have historically formed an important component of our revenues, and we believe they provide insight into our future performance.
Net cash provided by financing activities during the year ended December 31, 2022 was $2.9 million, which consisted exclusively of proceeds from the exercise of stock options. Contractual Obligations and Commitments Our contractual obligations and commitments as of December 31, 2023 consisted exclusively of operating lease obligations.
Financing Activities Net cash provided by financing activities during the years ended December 31, 2024 and 2023 was $2.1 million, which consisted of proceeds from the exercise of stock options and employee purchases from our employee stock purchase plan. Contractual Obligations and Commitments Our contractual obligations and commitments as of December 31, 2024 consisted exclusively of operating lease obligations.
Our preparation of these consolidated financial statements requires us to make estimates, assumptions and judgments that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. We evaluate our estimates and judgments on an ongoing basis.
Critical Accounting Estimates We have prepared our consolidated financial statements in accordance with U.S. GAAP. Our preparation of these consolidated financial statements requires us to make estimates, assumptions and judgments that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. We evaluate our estimates and judgments on an ongoing basis.
As of the dates presented, our key metrics described above were as follows: ​ ​ ​ ​ ​ ​ ​ As of December 31, ​ ​ 2023 2022 2021 Installed base of instruments (sold or leased) ​ 683 616 502 Core revenue generated by SPL clients as a percentage of core revenue ​ 48% 42% 40% Number of active SPLs ​ 23 18 15 Total number of licensed clinical programs (SPL clients only) ​ >160 >125 >95 Total number of licensed clinical programs under SPLs currently in the clinic ​ 16 16 15 Total number of licensed clinical programs under SPLs currently commercial ​ 1 - - Total potential pre-commercial milestones under SPLs ​ >$1.95 billion >$1.55 billion >$1.25 billion * Number of licensed clinical programs under SPL partnerships are by number of product candidates and not by indication. ​ 79 Table of Contents Components of Our Results of Operations Revenue We generate revenue principally from the sale of instruments, single-use PAs and buffers as well as from the lease of instruments to our customers.
As of the dates presented, our key metrics described above were as follows: ​ ​ ​ ​ ​ ​ ​ As of December 31, ​ ​ 2024 2023 2022 Installed base of instruments (sold or licensed) ​ 760 683 616 Core revenue generated by SPL clients as a percentage of core revenue ​ 55% 48% 42% Number of SPLs ​ 28 23 18 Total number of licensed clinical programs under SPLs currently in the clinic* ​ 18 16 16 Total number of licensed clinical programs under SPLs currently commercial* ​ 1 1 - * Number of licensed clinical programs under SPL agreements are by number of product candidates and not by indication. ​ 79 Table of Contents Components of Our Results of Operations Revenue We generate revenue principally from the sale of instruments, single-use PAs and consumables as well as from licenses to our customers.
Leases of instruments include warranty during the lease term without additional charge. Extended warranty and service plans generally have fixed fees and terms ranging from one additional year to four additional years and include an annual calibration.
Research and clinical licenses include a warranty during the license term without additional charge. Extended warranty and service plans generally have fixed fees and terms ranging from one additional year to four additional years and include an annual calibration.
We expect that as our installed instrument base grows, our sales of PAs and electroporation buffer solutions will grow accordingly, especially as cell therapy programs continue to progress through clinical development and potentially 76 Table of Contents become commercial-stage, thereby increasing the number of PAs needed by customers.
Our PA pricing varies based on the volume of cells processed and the number of transfections per PA. 76 Table of Contents We expect that as our installed instrument base grows, our sales of PAs and consumables will grow accordingly, especially as cell therapy programs continue to progress through clinical development and potentially become commercial-stage, thereby increasing the number of PAs needed by customers.
We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form 88 Table of Contents the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.
We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results could therefore differ materially from these estimates under different assumptions or conditions.
As of December 31, 2023, we have placed more than 680 of our electroporation instruments with customers worldwide. Historically, we have financed our operations primarily from the issuance and sale of equity securities, previous debt borrowings and cash flows from operations. On August 3, 2021, we issued and sold 15,525,000 shares of common stock in our U.S.
Historically, we have financed our operations primarily from the issuance and sale of equity securities, previous debt borrowings and cash flows from operations. On August 3, 2021, we issued and sold 15,525,000 shares of common stock in our U.S.
Cash Flows The following table summarizes our uses and sources of cash for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, (in thousands) 2023 2022 Net cash provided by (used in): ​ ​ ​ ​ ​ Operating activities ​ $ (21,686) ​ $ (14,783) Investing activities ​ 54,984 ​ (24,823) Financing activities ​ 2,143 ​ 2,888 Net increase (decrease) in cash and cash equivalents ​ $ 35,441 ​ $ (36,718) ​ Operating Activities Net cash used in operating activities for the year ended December 31, 2023 was $21.7 million, and consisted primarily of our net loss of $37.9 million, offset in part by net non-cash expenses of $12.4 million, including stock-based compensation of $14.0 million, depreciation and amortization expenses of $4.2 million, an increase in our inventory reserve of $0.7 million, and other non-cash expenses totaling $0.6 million, offset by the amortization of $7.1 million of discounts on investments.
Cash Flows The following table summarizes our uses and sources of cash for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, (in thousands) 2024 2023 Net cash provided by (used in): ​ ​ ​ ​ ​ Operating activities ​ $ (27,610) ​ $ (21,686) Investing activities ​ 6,932 ​ 54,984 Financing activities ​ 2,056 ​ 2,143 Net (decrease) increase in cash and cash equivalents ​ $ (18,622) ​ $ 35,441 86 Table of Contents ​ Operating Activities Net cash used in operating activities for the year ended December 31, 2024 was $27.6 million, and consisted primarily of our net loss of $41.1 million, offset in part by net non-cash expenses of $14.2 million, including stock-based compensation of $13.1 million, depreciation and amortization expenses of $4.3 million, an increase in our inventory reserve of $1.8 million, a loss on disposal of assets of $0.9 million, and other net non-cash expenses totaling $0.3 million, offset by the amortization of $6.2 million of discounts on investments.
We received aggregate net proceeds of $184.3 million after deducting aggregate underwriting commissions and offering costs of $17.6 million. 74 Table of Contents We believe that our current cash, cash equivalents and short-term investments will enable us to fund our operating expenses and capital expenditure requirements for at least the next 12 months from the date of the filing of this Annual Report.
We believe that our current cash, cash equivalents and short-term investments will enable us to fund our operating expenses and capital expenditure requirements for at least the next 12 months from the date of the filing of this Annual 74 Table of Contents Report.
Net cash used in operating activities for the year ended December 31, 2022 was $14.8 million, and consisted primarily of our net loss of $23.6 million, offset in part by net non-cash expenses of $12.8 million, including stock-based compensation of $11.8 million, depreciation and amortization expenses of $2.7 million, non-cash lease expense and other non-cash charges of $1.0 million, offset by the amortization of $2.7 million of discounts on investments.
Net cash used in operating activities for the year ended December 31, 2023 was $21.7 million, and consisted primarily of our net loss of $37.9 million, offset in part by net non-cash expenses of $12.4 million, including stock-based compensation of $14.0 million, depreciation and amortization expenses of $4.2 million, an increase in our inventory reserve of $0.7 million, and other non-cash expenses totaling $0.6 million, offset by the amortization of $7.1 million of discounts on investments.
In order to evaluate how our sales are trending across key markets, as well as the contribution of program economics from our SPL partnerships, we separately analyze revenue derived from our cell therapy customers and drug discovery customers, as well as the performance-based milestone revenues we recognize under our SPL partnerships.
We consider these sales and license revenue streams to be recurring revenues. In order to evaluate how our sales are trending across key markets, as well as the contribution of program economics from our SPL agreements, we separately analyze revenue derived from our core revenue, as well as the performance-based milestone revenues we recognize under our SPL agreements.
IPO at a price to the public of $13.00 per share, inclusive of 2,025,000 shares issued pursuant to the full exercise of the underwriters’ option to purchase additional shares. The IPO generated gross proceeds to us of $201.8 million.
IPO at a price to the public of $13.00 per share, inclusive of 2,025,000 shares issued pursuant to the full exercise of the underwriters’ option to purchase additional shares. The IPO generated gross proceeds to us of $201.8 million. We received aggregate net proceeds of $184.3 million after deducting aggregate underwriting commissions and offering costs of $17.6 million.
For cell therapy customers who use our technology to develop engineered cells for human therapeutic use in clinical trials or, if approved by regulatory authorities, for commercial sale, we license our platform on a non-exclusive basis in exchange for an annual fee per instrument licensed.
As a result of this lengthy and unpredictable sales cycle, we expect that we may be prone to quarterly fluctuations in our instrument sales revenue. 75 Table of Contents For cell therapy customers who use our technology to develop engineered cells for human therapeutic use in clinical trials or, if approved by regulatory authorities, for commercial sale, we license our platform on a non-exclusive basis in exchange for an annual fee per instrument licensed.
Cost of Goods Sold and Gross Profit ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ Change ​ 2023 2022 Amount % ​ (in thousands, except percentages) ​ ​ ​ ​ Cost of goods sold ​ $ 4,742 ​ $ 5,098 ​ $ (356) (7%) ​ Gross profit ​ $ 36,546 ​ $ 39,163 ​ $ (2,617) (7%) ​ Gross margin ​ ​ 89% ​ ​ 88% ​ ​ ​ ​ ​ ​ ​ Cost of goods sold decreased by $0.4 million, or 7%, for the year ended December 31, 2023, compared to the year ended December 31, 2022.
Cost of Goods Sold and Gross Profit ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ Change ​ 2024 2023 Amount % ​ (in thousands, except percentages) ​ ​ ​ ​ Cost of goods sold ​ $ 7,100 ​ $ 4,742 ​ $ 2,358 50% ​ Gross profit ​ $ 31,527 ​ $ 36,546 ​ $ (5,019) (14%) ​ Gross margin ​ ​ 82% ​ ​ 89% ​ ​ ​ ​ ​ ​ ​ Cost of goods sold increased by $2.4 million, or 50%, for the year ended December 31, 2024, compared to the year ended December 31, 2023.
Margins may also experience downward pressure during the investment phase of our internal PA production ramp up, increases in labor and materials costs, expansion of our PA portfolio, future design changes or the mix of PAs sold, or other factors, but may benefit in the mid-to-long term as PA production becomes more automated.
Margins may also experience downward pressure during the investment phase of our internal PA production ramp up, increases in labor and materials costs, expansion of our PA portfolio, future design changes or the mix of PAs sold, or other factors, but may benefit in the mid-to-long term as PA production becomes more automated. 78 Table of Contents Key Business Metrics In addition to revenue, we regularly review several key business metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections and make strategic decisions.
The increase was primarily driven by a $1.9 million increase in compensation expenses, a $1.6 million increase in professional fees, a $0.7 million increase in general office expenses, a $0.5 million increase in stock-based compensation, a $0.5 million increase in legal fees, a $0.2 million increase in memberships, and a $0.2 million increase in travel and other expenses, partially offset by a $0.9 million reduction in public company fees, and a $0.5 million decrease in occupancy expenses.
The decrease was primarily driven by a $1.6 million decrease in stock-based compensation, a $0.7 million decrease in engineering and lab expenses, and a $0.5 million decrease in office, travel, and general operating expenses, offset by a $0.6 million increase in occupancy expenses and a $0.6 million increase in compensation expenses.
Depreciation and Amortization ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ Change ​ 2023 2022 Amount % (in thousands, except percentages) ​ ​ ​ Depreciation and amortization ​ $ 3,985 ​ $ 2,528 ​ $ 1,457 58% ​ 85 Table of Contents Depreciation and amortization expense increased by $1.5 million, or 58%, for the year ended December 31, 2023, compared to the year ended December 31, 2022.
Depreciation and Amortization ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ Change ​ 2024 2023 Amount % (in thousands, except percentages) ​ ​ ​ Depreciation and amortization ​ $ 4,143 ​ $ 3,985 ​ $ 158 4% ​ Depreciation and amortization expense increased by $0.2 million, or 4%, for the year ended December 31, 2024, compared to the year ended December 31, 2023.
We expect to incur near-term operating losses as we continue to invest in expanding our business through growing our sales and marketing efforts, continued research and development, product development and expanding our product offerings.
As of December 31, 2024, we had cash and cash equivalents and short-term investments of $154.5 million. 85 Table of Contents We expect to incur near-term operating losses as we continue to invest in expanding our business through growing our sales and marketing efforts, continued research and development, product development and expanding our product offerings.
As of December 31, 2023, we had an accumulated deficit of $175.8 million.
As of December 31, 2024, we had an accumulated deficit of $216.9 million.
We received net proceeds of $184.3 million after deducting aggregate underwriting commissions and offering expenses of $17.6 million. As of December 31, 2023, we had cash and cash equivalents and short-term investments of $168.3 million.
We received net proceeds of $184.3 million after deducting aggregate underwriting commissions and offering expenses of $17.6 million.
The decrease was primarily driven by the decreases in total core revenue described below. Total core revenue for the year ended December 31, 2023 was $29.8 million, a decrease of $9.8 million, or 25%, compared to core revenue of $39.6 million for the year ended December 31, 2022.
The decrease was primarily driven by the decreases in program-related revenue. Total core revenue for the year ended December 31, 2024 was $32.5 million, an increase of $2.7 million, or 9%, compared to core revenue of $29.8 million for the year ended December 31, 2023.
General and Administrative ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ Change ​ 2023 2022 Amount % ​ (in thousands, except percentages) ​ ​ ​ ​ General and administrative ​ $ 30,068 ​ $ 25,829 ​ $ 4,239 16% ​ ​ General and administrative expense increased by $4.2 million, or 16%, for the year ended December 31, 2023, compared to the year ended December 31, 2022.
General and Administrative ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ Change ​ 2024 2023 Amount % ​ (in thousands, except percentages) ​ ​ ​ ​ General and administrative ​ $ 29,693 ​ $ 30,068 ​ $ (375) (1)% ​ ​ General and administrative expenses decreased by $0.4 million, or 1%, for the year ended December 31, 2024, compared to the year ended December 31, 2023.
Our leases of instruments to customers consist of fixed license/lease payments and variable milestone payments that are dependent on our customer's achievement of clinical milestones. Typically, instrument leases that provide for clinical or commercial use also include sales-based milestone payments (and/or sales-based royalties in some cases) upon the commercialization of the customer's product.
Typically, licenses that provide for clinical or commercial use also include sales-based milestone payments (and/or sales-based royalties in some cases) upon the commercialization of the customer's product.
Sales and Marketing ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ Change ​ 2023 2022 Amount % ​ (in thousands, except percentages) ​ ​ ​ ​ Sales and marketing ​ $ 26,975 ​ $ 18,653 ​ $ 8,322 45% ​ ​ Sales and marketing expenses increased by $8.3 million, or 45%, for the year ended December 31, 2023, compared to the year ended December 31, 2022.
Sales and Marketing ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ Change ​ 2024 2023 Amount % ​ (in thousands, except percentages) ​ ​ ​ ​ Sales and marketing ​ $ 26,661 ​ $ 26,975 ​ $ (314) (1%) ​ ​ 84 Table of Contents Sales and marketing expenses decreased by $0.3 million, or 1%, for the year ended December 31, 2024, compared to the year ended December 31, 2023.
We believe the features and performance of our platform have led to sustained customer engagement. Our existing customer base ranges from large biopharmaceutical companies, including a majority of the top 25 pharmaceutical companies based on 2022 global revenue, to hundreds of biotechnology companies and academic centers focused on translational research.
Our existing customer base ranges from large biopharmaceutical companies, including a majority of the top 25 pharmaceutical companies based on 2023 global revenue, to hundreds of biotechnology companies and academic centers focused on translational research. As of December 31, 2024, we have placed more than 760 of our electroporation instruments with customers worldwide.
Liquidity and Capital Resources Since our inception, we have experienced losses and negative cash flows from operations. For the years ended December 31, 2023 and 2022, we incurred net losses of $37.9 million and $23.6 million, respectively. As of December 31, 2023, we had an accumulated deficit of $175.8 million.
The decrease is primarily due to a decrease in balances of cash and investments. Liquidity and Capital Resources Since our inception, we have experienced losses and negative cash flows from operations. For the years ended December 31, 2024 and 2023, we incurred net losses of $41.1 million and $37.9 million, respectively.
The increase was primarily driven by a $4.3 million increase in compensation expenses as a result of increases in headcount, a $1.2 million increase in occupancy expenses, a $0.8 million increase in travel expenses, a $0.7 million increase in stock-based compensation, a $0.6 million increase in marketing expenses, a $0.4 million increase in professional fees, and a $0.3 million increase in general office expenses.
The decrease was primarily driven by a $1.0 million decrease in occupancy expenses, a $0.4 million decrease in travel expenses, a $0.3 million decrease in stock-based compensation, and a $0.2 million decrease in professional services and marketing expenses, offset by a $1.4 million increase in compensation expense and a $0.2 million increase in software subscriptions.
We expect program-related revenue to continue to experience variability for some time, although we anticipate that variability may moderate as the volume of SPL partnerships and associated milestones grows.
The decrease reflects the expected variability from period to period in the level of program-related revenue given the small number of individual triggering events which currently generate this portion of revenue. We expect program-related revenue to continue to experience variability for some time, although we anticipate that variability may moderate as the volume of SPL agreements and associated milestones grows.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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As a result, a 10% change in the level of market interest rates would not be expected to have a material effect on our business, financial condition or results of operations. 90 Table of Contents Foreign Currency Risk We are exposed to financial risks as a result of exchange rate fluctuations between the U.S.
As a result, a 10% change in the level of market interest rates would not be expected to have a material effect on our business, financial condition or results of operations. Foreign Currency Risk We are exposed to financial risks as a result of exchange rate fluctuations between the U.S.
We are unable to predict whether inflation or changing prices will materially affect our business in the foreseeable future. ​ 91 Table of Contents ​
We are unable to predict whether inflation or changing prices will materially affect our business in the foreseeable future. ​ 89 Table of Contents ​

Other MXCT 10-K year-over-year comparisons