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What changed in RxSight, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of RxSight, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+380 added−368 removedSource: 10-K (2025-02-25) vs 10-K (2024-02-28)

Top changes in RxSight, Inc.'s 2024 10-K

380 paragraphs added · 368 removed · 312 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

87 edited+9 added−9 removed287 unchanged
Biggest changePMA supplements often require submission of the same type of information as an initial PMA application, except that the supplement is limited to information needed to support any changes from the device covered by the approved PMA application and may or may not require as extensive technical or clinical data or the convening of an advisory panel, depending on the nature of the proposed change. 18 In approving a PMA application, as a condition of approval, the FDA may also require some form of post-approval study or post-market surveillance, whereby the applicant conducts a follow-up study or follows certain patient groups for a number of years and makes periodic reports to the FDA on the clinical status of those patients when necessary to protect the public health or to provide additional or longer term safety and effectiveness data for the device.
Biggest changeIn approving a PMA application, as a condition of approval, the FDA may also require some form of post-approval study or post-market surveillance, whereby the applicant conducts a follow-up study or follows certain patient groups for a number of years and makes periodic reports to the FDA on the clinical status of those patients when necessary to protect the public health or to provide additional or longer term safety and effectiveness data for the device.
The result is blurry or hazy vision and increased sensitivity to light, particularly at night, that cannot be treated with glasses or contact lenses. Cataracts are irreversible, progressive and usually affect both eyes. Cataracts can significantly interfere with daily activities, affect quality of life and eventually cause 2 blindness.
The result is blurry or hazy vision and increased sensitivity to light, particularly at night, that cannot be treated with glasses or contact lenses. Cataracts are irreversible, progressive and usually affect both eyes. Cataracts can 2 significantly interfere with daily activities, affect quality of life and eventually cause blindness.
They create an elongated focal point that allows for a broader range of vision, although patients will still often require glasses for distance and near vision. EDOF lenses will still typically result in glare and 4 halos, as well as reduced contrast vision, although generally less severe than those experienced with multifocal lenses; and • Astigmatism-Correcting or Toric Lenses.
They create an elongated focal point that allows for a broader range of vision, although patients will still often require glasses for distance and near vision. EDOF lenses will still typically result in glare and halos, as well as reduced contrast vision, although generally less severe than those experienced with multifocal lenses; and 4 • Astigmatism-Correcting or Toric Lenses.
With the RxSight system, the doctor performs a standard cataract procedure to implant the LAL, determines refractive error with patient input after healing is complete, then uses the LDD to reshape the 5 LAL to achieve the patients’ desired vision outcomes.
With the RxSight system, the doctor performs a standard cataract procedure to implant the LAL, determines refractive error with patient input after healing is complete, then uses the LDD to reshape the LAL 5 to achieve the patients’ desired vision outcomes.
This creates an excess concentration of free macromers in the unexposed portion of the lens and sets up a diffusion gradient over which the unpolymerized macromers 6 move from the concentrated area to the less concentrated area. Over the next one to two days, the unpolymerized macromers redistribute across the lens to achieve a uniform distribution.
This creates an excess concentration of free macromers in the unexposed portion of the lens and sets up a diffusion gradient over which the unpolymerized macromers move from the concentrated area to the less concentrated area. Over the next one to two days, the unpolymerized macromers redistribute across 6 the lens to achieve a uniform distribution.
The commencement or completion of any clinical trial may be delayed or halted, or be inadequate to support approval of a PMA application, for numerous reasons, including, but not limited to, the following: • The FDA or other regulatory authorities do not approve a clinical trial protocol or a clinical trial, or place a clinical trial on hold; • Patients do not enroll in clinical trials at the rate expected; • Patients do not comply with trial protocols; • Patient follow-up is not at the rate expected; • Patients experience adverse events; • Patients die during a clinical trial, even though their death may not be related to the products that are part of the trial; 16 • Device malfunctions occur with unexpected frequency or potential adverse consequences; • Side effects or device malfunctions of similar products already in the market that change the FDA’s view toward approval of new or similar PMAs or result in the imposition of new requirements or testing; • Institutional review boards and third-party clinical investigators may delay or reject the trial protocol; • Third-party clinical investigators decline to participate in a trial or do not perform a trial on the anticipated schedule or consistent with the clinical trial protocol, investigator agreement, investigational plan, good clinical practices, the IDE regulations, or other FDA or IRB requirements; • Third-party investigators are disqualified by the FDA; • We or third-party organizations do not perform data collection, monitoring and analysis in a timely or accurate manner or consistent with the clinical trial protocol or investigational or statistical plans, or otherwise fail to comply with the IDE regulations governing responsibilities, records, and reports of sponsors of clinical investigations; • Third-party clinical investigators have significant financial interests related to us or our study such that the FDA deems the study results unreliable, or we or investigators fail to disclose such interests; • Regulatory inspections of our clinical trials or manufacturing facilities, which may, among other things, require us to undertake corrective action or suspend or terminate our clinical trials; • Changes in government regulations or administrative actions; • The interim or final results of the clinical trial are inconclusive or unfavorable as to safety or effectiveness; or • The FDA concludes that our trial design is unreliable or inadequate to demonstrate safety and effectiveness.
The commencement or completion of any clinical trial may be delayed or halted, or be inadequate to support approval of a PMA application, for numerous reasons, including, but not limited to, the following: • The FDA or other regulatory authorities do not approve a clinical trial protocol or a clinical trial, or place a clinical trial on hold; • Patients do not enroll in clinical trials at the rate expected; • Patients do not comply with trial protocols; • Patient follow-up is not at the rate expected; • Patients experience adverse events; • Patients die during a clinical trial, even though their death may not be related to the products that are part of the trial; • Device malfunctions occur with unexpected frequency or potential adverse consequences; • Side effects or device malfunctions of similar products already in the market that change the FDA’s view toward approval of new or similar PMAs or result in the imposition of new requirements or testing; • Institutional review boards and third-party clinical investigators may delay or reject the trial protocol; • Third-party clinical investigators decline to participate in a trial or do not perform a trial on the anticipated schedule or consistent with the clinical trial protocol, investigator agreement, investigational plan, good clinical practices, the IDE regulations, or other FDA or IRB requirements; • Third-party investigators are disqualified by the FDA; • We or third-party organizations do not perform data collection, monitoring and analysis in a timely or accurate manner or consistent with the clinical trial protocol or investigational or statistical plans, or otherwise fail to comply with the IDE regulations governing responsibilities, records, and reports of sponsors of clinical investigations; • Third-party clinical investigators have significant financial interests related to us or our study such that the FDA deems the study results unreliable, or we or investigators fail to disclose such interests; • Regulatory inspections of our clinical trials or manufacturing facilities, which may, among other things, require us to undertake corrective action or suspend or terminate our clinical trials; • Changes in government regulations or administrative actions; • The interim or final results of the clinical trial are inconclusive or unfavorable as to safety or effectiveness; or 16 • The FDA concludes that our trial design is unreliable or inadequate to demonstrate safety and effectiveness.
Ongoing regulation by the FDA Even after the FDA permits a device to be marketed, numerous regulatory requirements apply, including but not limited to: • establishment registration and device listing; • the QSR, or Quality Management System Regulation (“QMSR”), which goes into effect in February 2026, which requires manufacturers, including third-party manufacturers, to follow stringent design, testing, production, control, supplier/contractor selection, complaint handling, documentation, and other quality assurance procedures during the manufacturing process; • labeling regulations, advertising and promotion requirements, restrictions on sale distribution or use of a device, each including the FDA general prohibition against the promotion of products for any uses other than those authorized by the FDA, which are commonly known as “off label” uses; • the Medical Device Reporting (“MDR”) regulation, which requires that manufactures report to the FDA if their device may have caused or contributed to a death or serious injury or if their device malfunctioned and the device or a similar device marketed by the manufacturer would be likely to cause or contribute to a death or serious injury if the malfunction were to recur; • medical device corrections and removal reporting regulations, which require that manufactures report to the FDA field corrections or removals if undertaken to reduce a risk to health posed by a device or to remedy a violation of the FDCA Act that may present a risk to health; • recall requirements, including a mandatory recall if there is a reasonable probability that the device would cause serious adverse health consequences or death; • an order of repair, replacement or refund; • device tracking requirements; and • post market study and surveillance requirements.
Ongoing regulation by the FDA Even after the FDA permits a device to be marketed, numerous regulatory requirements apply, including but not limited to: • establishment registration and device listing; • the QSR, or Quality Management System Regulation (“QMSR”), which goes into effect in February 2026, which requires manufacturers, including third-party manufacturers, to follow stringent design, testing, production, control, supplier/contractor selection, complaint handling, documentation, and other quality assurance procedures during the manufacturing process; • labeling regulations, advertising and promotion requirements, restrictions on sale distribution or use of a device, each including the FDA general prohibition against the promotion of products for any uses other than those authorized by the FDA, which are commonly known as “off label” uses; • the Medical Device Reporting (“MDR”) regulation, which requires that manufactures report to the FDA if their device may have caused or contributed to a death or serious injury or if their device malfunctioned and the device or a similar 18 device marketed by the manufacturer would be likely to cause or contribute to a death or serious injury if the malfunction were to recur; • medical device corrections and removal reporting regulations, which require that manufactures report to the FDA field corrections or removals if undertaken to reduce a risk to health posed by a device or to remedy a violation of the FDCA Act that may present a risk to health; • recall requirements, including a mandatory recall if there is a reasonable probability that the device would cause serious adverse health consequences or death; • an order of repair, replacement or refund; • device tracking requirements; and • post market study and surveillance requirements.
The federal Physician Payments Sunshine Act requires applicable manufacturers of covered drugs, medical devices, biologics and medical supplies for which payment is available under Medicare, Medicaid, or the Children’s Health Insurance Program, with specific exceptions, to annually report to CMS information regarding payments and other transfers of value to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain non-physician healthcare professionals (such as physician assistants and nurse practitioners, among others) and teaching hospitals, as well as information regarding ownership and investment interests held by physicians and their immediate family members; • The Foreign Corrupt Practices Act (“FCPA”) prohibits any U.S. individual or business from paying, offering, or authorizing payment or offering of anything of value, directly or indirectly, to any foreign official, political party or candidate for the purpose of influencing any act or decision of the foreign entity in order to assist the individual or business in obtaining or retaining business.
The federal Physician Payments Sunshine Act requires applicable manufacturers of covered drugs, medical devices, biologics and medical supplies for which payment is available under Medicare, Medicaid, or the Children’s Health Insurance Program, with specific exceptions, to annually report to CMS information regarding payments and other transfers of value to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain non-physician healthcare professionals (such as physician assistants and nurse practitioners, among others) and teaching hospitals, as well as information regarding ownership and investment interests held by physicians and their immediate family members; 21 • The Foreign Corrupt Practices Act (“FCPA”) prohibits any U.S. individual or business from paying, offering, or authorizing payment or offering of anything of value, directly or indirectly, to any foreign official, political party or candidate for the purpose of influencing any act or decision of the foreign entity in order to assist the individual or business in obtaining or retaining business.
Other legislative changes have been proposed and adopted since the ACA was enacted, including aggregate reductions of Medicare payments to providers of 2% per fiscal year and reduced payments to several types of Medicare providers, which will remain in effect through 2032 absent additional congressional action, with the exception of a temporary suspension from May 1, 2020 through March 31, 2022 due to the COVID-19 pandemic, unless additional action is taken by Congress.
Other legislative changes have been proposed and adopted since the ACA was enacted, including aggregate reductions of Medicare payments to providers of 2% per 22 fiscal year and reduced payments to several types of Medicare providers, which will remain in effect through 2032 absent additional congressional action, with the exception of a temporary suspension from May 1, 2020 through March 31, 2022 due to the COVID-19 pandemic, unless additional action is taken by Congress.
As of 2017, CMS has recognized the LAL as an astigmatism correcting (premium) IOL, making it eligible for the dual aspect payment model. Most commercial payers mirror the Medicare rulings, but this can vary by payor. Procedure coding and payment In the United States, we primarily sell our LAL products to ambulatory surgical centers (“ASCs”) and occasionally to hospitals.
As of 2017, CMS has recognized the LAL as an astigmatism correcting (premium) IOL, making it eligible for the dual aspect payment model. Most commercial payers mirror the Medicare rulings, but this can vary by payor. 11 Procedure coding and payment In the United States, we primarily sell our LAL products to ambulatory surgical centers (“ASCs”) and occasionally to hospitals.
The CPRA, which became effective January 1, 2023 created additional obligations with respect to certain data relating to consumers, significantly expands the CCPA, including by introducing additional obligations such as data minimization and storage limitations, granting additional rights to consumers, such as correction of personal information and additional opt-out rights, and creates a new entity, the California Privacy Protection Agency, to implement and enforce the law.
The CPRA, which became effective January 1, 2023 created additional obligations with respect to certain data relating to consumers, 23 significantly expands the CCPA, including by introducing additional obligations such as data minimization and storage limitations, granting additional rights to consumers, such as correction of personal information and additional opt-out rights, and creates a new entity, the California Privacy Protection Agency, to implement and enforce the law.
Devices are classified in accordance with their perceived risks, similarly to the U.S. system. The class of a product determines the conformity assessment required before the CE mark can be placed on a product. Conformity assessments for our products are carried out as required by the MDD. Each member state 20 can appoint Notified Bodies within its jurisdiction.
Devices are classified in accordance with their perceived risks, similarly to the U.S. system. The class of a product determines the conformity assessment required before the CE mark can be placed on a product. Conformity assessments for our products are carried out as required by the MDD. Each member state can appoint Notified Bodies within its jurisdiction.
If our practices are not consistent, or are viewed as not consistent, with changes in laws, regulations and standards or the interpretations or applications of existing laws, regulations and standards, 24 we may also become subject to fines, audits, inquiries, whistleblower complaints, adverse media coverage, investigations, lawsuits, loss of export privileges, severe criminal or civil sanction or other penalties.
If our practices are not consistent, or are viewed as not consistent, with changes in laws, regulations and standards or the interpretations or applications of existing laws, regulations and standards, we may also become subject to fines, audits, inquiries, whistleblower complaints, adverse media coverage, investigations, lawsuits, loss of export privileges, severe criminal or civil sanction or other penalties.
Our suppliers are evaluated, qualified, and approved as part of our supplier quality program, which includes verification and monitoring procedures to ensure that our suppliers comply with FDA and ISO standards, as well as our own 11 specifications and requirements. We inspect and verify externally sourced components under strict processes supported by internal policies and procedures.
Our suppliers are evaluated, qualified, and approved as part of our supplier quality program, which includes verification and monitoring procedures to ensure that our suppliers comply with FDA and ISO standards, as well as our own specifications and requirements. We inspect and verify externally sourced components under strict processes supported by internal policies and procedures.
Although we take steps to protect our trade secrets and know-how, third parties may independently develop or otherwise gain access to our trade secrets and know-how. For more information regarding risks related to our intellectual property, please see “Risk Factors-Risks related to Intellectual Property” in Part I, Item 1A of this Annual Report.
Although we take steps to protect our trade secrets and know-how, third parties may independently develop or otherwise gain access to our trade secrets and know-how. 13 For more information regarding risks related to our intellectual property, please see “Risk Factors-Risks related to Intellectual Property” in Part I, Item 1A of this Annual Report.
A 17 manufacturer can also submit a petition for direct de novo review if the manufacturer is unable to identify an appropriate predicate device and the new device or new use of the device presents a moderate or low risk. Medical devices can only be marketed for the indications for which they are cleared or approved.
A manufacturer can also submit a petition for direct de novo review if the manufacturer is unable to identify an appropriate predicate device and the new device or new use of the device presents a moderate or low risk. Medical devices can only be marketed for the indications for which they are cleared or approved.
Our commercial efforts are designed to create a “razor and razor blade” business model by building a sizable LDD installed base to drive ongoing growth in LAL procedure volumes. LDD sales personnel are responsible for establishing relationships with doctors and securing new customers.
Sales and marketing Our commercial efforts are designed to create a “razor and razor blade” business model by building a sizable LDD installed base to drive ongoing growth in LAL procedure volumes. LDD sales personnel are responsible for establishing relationships with doctors and securing new customers.
Generally, in the United States, issued patents are granted a term of 20 years from the earliest claimed non-provisional or Patent Cooperation Treaty (“PCT”) filing date. In certain instances, a patent term can be adjusted to recapture a portion of delay by the U.S.
Generally, in the United States, issued patents are granted a term of 20 years from the earliest claimed non-provisional or Patent Cooperation Treaty (“PCT”) filing date. In certain instances, a patent term can be adjusted to recapture a portion of delay by the 12 U.S.
They will also be required to return for an additional two to three clinic visits 14 compared to traditional cataract surgery. The additional clinic visits are non-surgical but do require the patient’s eyes to be dilated. Due to these additional requirements, market acceptance of the LAL may be impacted.
They will also be required to return for an additional two to three clinic visits compared to traditional cataract surgery. The additional clinic visits are non-surgical but do require the patient’s eyes to be dilated. Due to these additional requirements, market acceptance of the LAL may be impacted.
The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions. Prior to approval of a PMA, the FDA may conduct inspections of the clinical trial data and clinical trial sites, as well as inspections of the manufacturing facility and processes.
The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions. 17 Prior to approval of a PMA, the FDA may conduct inspections of the clinical trial data and clinical trial sites, as well as inspections of the manufacturing facility and processes.
QAD provides limited 13 warranties to the software and retains all intellectual property ownership rights in the QAD software including any modifications made by us, however we receive a license to use any modifications made by us. Unless earlier terminated, the term of the QAD agreement is perpetual.
QAD provides limited warranties to the software and retains all intellectual property ownership rights in the QAD software including any modifications made by us, however we receive a license to use any modifications made by us. Unless earlier terminated, the term of the QAD agreement is perpetual.
For example, in the United States, sales, marketing and scientific and educational programs also must comply with state and federal fraud and abuse, anti-kickback false claims, transparency, government price reporting, anti-corruption, and health information privacy and security laws and regulations.
For example, in the United 20 States, sales, marketing and scientific and educational programs also must comply with state and federal fraud and abuse, anti-kickback false claims, transparency, government price reporting, anti-corruption, and health information privacy and security laws and regulations.
In our Food and Drug Administration (“FDA”) clinical trial, 70% of LAL patients achieved 20/20 or better uncorrected visual acuity without glasses, while in similar trials of other premium IOLs, only about 40% of patients achieved this performance level.
In our Food and Drug Administration (“FDA”) clinical trial, 70% of LAL patients achieved 20/20 or better uncorrected visual acuity without glasses, while in similar 1 trials of other premium IOLs, only about 40% of patients achieved this performance level.
Certain of these changes could impose additional limitations on the rates we will be able to charge for our current and future products or the amounts of reimbursement 23 available for our current and future products from governmental agencies or third-party payors.
Certain of these changes could impose additional limitations on the rates we will be able to charge for our current and future products or the amounts of reimbursement available for our current and future products from governmental agencies or third-party payors.
We have received International Organization for Standardization (“ISO”) 13485:2016 certification for our quality management system. ISO certification generally includes recertification audits every third year, scheduled annual surveillance audits and periodic unannounced audits.
We have received International Organization for Standardization (“ISO”) 13485:2016 certification for our quality management system. ISO certification generally includes recertification audits every third year, scheduled annual surveillance 10 audits and periodic unannounced audits.
In the study, 70.1% of LAL subjects achieved monocular uncorrected distance visual acuity of 20/20 or better compared to 36.3% of the eyes implanted with the monofocal control IOL.
In the study, 70.1% of LAL 9 subjects achieved monocular uncorrected distance visual acuity of 20/20 or better compared to 36.3% of the eyes implanted with the monofocal control IOL.
If the device presents a “significant risk” to human health, as defined by the FDA, the sponsor must submit an IDE application to the FDA and obtain IDE approval prior to commencing the human clinical trials.
If the device presents a “significant risk” 15 to human health, as defined by the FDA, the sponsor must submit an IDE application to the FDA and obtain IDE approval prior to commencing the human clinical trials.
The FDA uses the same procedures and actions in reviewing PMA supplements as it does in reviewing original PMA applications. 19 FDA regulations require us to register as a medical device manufacturer with the FDA.
The FDA uses the same procedures and actions in reviewing PMA supplements as it does in reviewing original PMA applications. FDA regulations require us to register as a medical device manufacturer with the FDA.
Information contained on our website is not incorporated by reference into this Annual Report on Form 10-K or any other filings we make with the SEC. 25
Information contained on our website is not incorporated by reference into this Annual Report on Form 10-K or any other filings we make with the SEC.
The 15 PMA application must provide valid scientific evidence that demonstrates to the FDA’s satisfaction a reasonable assurance of the safety and effectiveness of the device for its intended use.
The PMA application must provide valid scientific evidence that demonstrates to the FDA’s satisfaction a reasonable assurance of the safety and effectiveness of the device for its intended use.
All other premium IOLs are fixed-power lenses that cannot be adjusted following surgery; 1 • Delivering superior visual outcomes with low risk of side effects.
All other premium IOLs are fixed-power lenses that cannot be adjusted following surgery; • Delivering superior visual outcomes with low risk of side effects.
New customer contracts typically include sale of the LDD between approximately $110,000 - $145,000, sale of LALs for approximately $1,000 each and an LAL consignment agreement. Once the LDD is installed, our clinical specialists work closely with the practice’s doctors, technicians and staff members to ensure that they are fully trained, proficient LAL providers.
New customer contracts typically include sale of the LDD between approximately $130,000 - $145,000, sale of LALs for approximately $1,000 each and an LAL consignment agreement. Once the LDD is installed, our clinical specialists work closely with the practice’s doctors, technicians and staff members to ensure that they are fully trained, proficient LAL providers.
The growth of our business and 22 sales organization and our expansion outside of the United States may increase the potential of violating these laws or our internal policies and procedures.
The growth of our business and sales organization and our expansion outside of the United States may increase the potential of violating these laws or our internal policies and procedures.
Any issued patents that we may own or in-license in the future may be challenged, invalidated, narrowed, held unenforceable, infringed or circumvented. As of December 31, 2023, our patent estate is directed to various aspects of our programs and technology, including our LAL and our LDD as well as lens adjustment procedure and other technology.
Any issued patents that we may own or in-license in the future may be challenged, invalidated, narrowed, held unenforceable, infringed or circumvented. As of December 31, 2024, our patent estate is directed to various aspects of our programs and technology, including our LAL and our LDD as well as lens adjustment procedure and other technology.
Since launching the RxSight system commercially in 2019, we have substantially increased the size and scope of our U.S. commercial organization.
Since launching the RxSight system commercially in late 2019, we have substantially increased the size and scope of our U.S. commercial organization.
Toric lenses correct for astigmatism, a condition in which the cornea is not uniformly curved leading to distortion of near and distance vision. According to the 2023 Market Scope IOL Report, approximately 70% of the population has clinically significant astigmatism of 0.5 diopters or more.
Toric lenses correct for astigmatism, a condition in which the cornea is not uniformly curved leading to distortion of near and distance vision. According to the 2024 Market Scope IOL Report, approximately 70% of the population has clinically significant astigmatism of 0.5 diopters or more.
The Acrysof and Tecnis families of IOLs are available in a monofocal Toric, multifocal Toric and EDOF Toric versions. The PC and Toric versions of these lenses represented over half of all premium multifocal IOLs sold in 2023. The rest of the market is shared between several smaller companies each with under 5% market share.
The Acrysof and Tecnis families of IOLs are available in a monofocal Toric, multifocal Toric and EDOF Toric versions. The PC and Toric versions of these lenses represented over half of all premium multifocal IOLs sold in 2024. The rest of the market is shared between several smaller companies each with under 5% market share.
The doctor can also share the LAL’s clinical results with the patient to provide reassurance that the procedure will deliver desired results; • Increased confidence. The clinical benefit of “dialing-in” to achieve superior visual outcomes postoperatively increases doctors’ confidence that the LAL can meet patients’ expectations.
The doctor can also share the LALs clinical results with the patient to provide reassurance that the procedure will deliver desired results; • Increased confidence. The clinical benefit of “dialing-in” to achieve superior visual outcomes postoperatively increases doctors’ confidence that the LAL can meet patients’ expectations.
In 21 recent years, the number of suits brought against healthcare companies by private individuals has increased dramatically.
In recent years, the number of suits brought against healthcare companies by private individuals has increased dramatically.
The RxSight system is comprised of our RxSight Light Adjustable Lens ® (“LAL ® ”), RxSight Light Delivery Device (“LDD™”) and accessories. Our LAL is a premium intraocular lens (“IOL”) made of proprietary photosensitive material that changes shape in response to specific patterns of ultraviolet (“UV”) light generated by our LDD.
The RxSight system is comprised of our RxSight Light Adjustable Lens ® (LAL™/LAL+ ® , collectively the “LAL”), RxSight Light Delivery Device (“LDD™”) and accessories. Our LAL is a premium intraocular lens (“IOL”) made of proprietary photosensitive material that changes shape in response to specific patterns of ultraviolet (“UV”) light generated by our LDD.
In our most recent Phase IV commercial study data over 90% of LAL patients who chose to optimize vision with both eyes, achieved 20/20 distance vision and were also able to read 5-point font without glasses; 7 • Postoperative customization.
In our most recent Phase IV commercial study data over 90% of LAL patients who chose to optimize vision with both eyes, achieved 20/25 or better distance vision and were also able to read 5-point font without glasses; 7 • Postoperative customization.
The surgeon fee covers all pre-operative cataract testing, the cataract operation and follow-up care for three months. 3 For U.S. premium cataract procedures, the healthcare payor (primarily CMS) reimburses the same surgeon and facility fees, but the patient pays the surgeon an additional fee between $1,000-$2,000 for implantation of a toric IOL and an average between $2,000-$4,000 for implantation of other premium lenses, which includes the cost of the premium IOL.
The surgeon fee covers all pre-operative cataract testing, the cataract operation and follow-up care for three months. 3 For U.S. premium cataract procedures, the healthcare payor (primarily CMS) reimburses the same surgeon and facility fees, but the patient pays the surgeon an additional fee of approximately $2,000 for implantation of a toric IOL and an average between $2,000-$5,000 for implantation of other premium lenses, which includes the cost of the premium IOL.
Additionally, LAL patients do not experience increased incidence of glare or halos that are common with other premium IOLs; • Providing accuracy and precision to optimize vision with both eyes. Most LAL patients choose minor differences in the refractive correction of each eye, resulting in glasses-free vision across a full range of distances.
Additionally, LAL patients do not experience increased incidence of glare or halos that are common with other premium IOLs; • Providing accuracy and precision to optimize vision with both eyes. Most LAL patients choose minor differences in the refractive correction of each eye, which can result in glasses-free vision across a full range of distances.
While our current commercial focus is on the large opportunity within the United States, we believe the RxSight system offers compelling benefits for cataract doctors and patients in select international markets. According to the Market Scope 2023 Premium Report, over 75% of the premium IOL procedures in 2023 were outside the United States.
While our current commercial focus is on the large opportunity within the United States, we believe the RxSight system offers compelling benefits for cataract doctors and patients in select international markets. According to the Market Scope 2024 Premium Report, over 80% of the premium IOL procedures in 2024 were outside the United States.
Employees and human capital As of December 31, 2023, we had 374 full-time employees. All of our employees are full-time and none of our employees are represented by a labor union or covered under a collective bargaining agreement. Our human capital resources objectives include, as applicable, identifying, recruiting, retaining, incentivizing and integrating our existing and new employees, advisors and consultants.
Employees and human capital As of December 31, 2024, we had 498 full-time employees. All of our employees are full-time and none of our employees are represented by a labor union or covered under a collective bargaining agreement. Our human capital resources objectives include, as applicable, identifying, recruiting, retaining, incentivizing and integrating our existing and new employees, advisors and consultants.
In the United States, Medicare and private insurers typically cover the full cost of spherical IOL procedures, while premium IOL procedures require patients to pay an incremental out-of-pocket fee, typically ranging from $1,000 to $4,000 per eye depending on the specific premium IOL used.
In the United States, Medicare and private insurers typically cover the full cost of spherical IOL procedures, while premium IOL procedures require patients to pay an incremental out-of-pocket fee, typically ranging from $2,000 to $5,000 per eye depending on the specific premium IOL used.
To achieve broad awareness of the RxSight system among cataract surgeons, we also conduct various marketing programs, including promotions at industry and society conferences, podium presentations, social media, and educational webinars focused on the differentiated benefits of our RxSight system. Our RxSight system has received regulatory approval in Mexico and Canada.
To achieve broad awareness of the RxSight system among cataract surgeons, we also conduct various marketing programs, including promotions at industry and society conferences, podium presentations, social media, and educational webinars focused on the differentiated benefits of our RxSight system. Our RxSight system has regulatory approval in the U.S., Europe, Canada, Mexico and Korea.
Research and development expenses were $29.1 million and $26.0 million for the years ended December 31, 2023 and 2022, respectively. 10 Manufacturing and supply We currently manufacture, assemble, test, and ship our LAL and LDD in Aliso Viejo, California at our campus of four facilities which consist of an aggregate of approximately 121,000 total square feet.
Research and development expenses were $34.4 million, $29.1 million and $26.0 million for the years ended December 31, 2024, 2023 and 2022 respectively. Manufacturing and supply We currently manufacture, assemble, test, and ship our LAL and LDD in Aliso Viejo, California at our campus of four facilities which consist of an aggregate of approximately 150,000 total square feet.
We offer a single IOL that can address a broad range of patient types and needs, while providing a solution that doctors can trust to improve visual outcomes, eliminating the need for extensive preoperative discussions with patients about which IOL may best fit their lifestyle and visual preferences.
Our IOLs can address a broad range of patient types and needs, while providing a solution that doctors can trust to improve visual outcomes, eliminating the need for extensive preoperative discussions with patients about which IOL may best fit their lifestyle and visual preferences.
According to Market Scope, the global cataract IOL market is highly concentrated, with these top three players accounting for approximately 77% of the total U.S. premium cataract surgery market and approximately 61% of the global manufacturer market revenue. Our competitors are significantly larger than us with greater financial, marketing, sales and personnel resources, greater brand recognition and longer operating histories.
According to Market Scope, the global cataract IOL market is highly concentrated, with these top two players accounting for approximately 75% of the total U.S. premium cataract surgery market and approximately 60% of the global manufacturer market revenue. Our competitors are significantly larger than us with greater financial, marketing, sales and personnel resources, greater brand recognition and longer operating histories.
We began commercializing our solution in the United States in 2019 and are focused on establishing the RxSight system as the standard of care for premium IOL procedures. As of December 31, 2023, we had an installed base of 666 LDDs in ophthalmology practices, and since our inception over 96,000 surgeries have been performed with our RxSight system.
We began commercializing our solution in the United States in 2019 and are focused on establishing the RxSight system as the standard of care for premium IOL procedures. As of December 31, 2024, we had an installed base of 971 LDDs in ophthalmology practices, and since our inception over 195,000 surgeries have been performed with our RxSight system.
Key growth drivers include the increasing number of patients who prefer to be glasses-free, technological innovations, increased access to healthcare and rising disposable income; and • In the United States, there are approximately 8,000 ophthalmic surgeons that perform cataract surgery, including approximately 4,000 that perform roughly 70%-80% of premium IOL cataract procedures.
Key growth drivers include the increasing number of patients who prefer to be glasses-free, technological innovations, increased access to healthcare and rising disposable income; and • In the United States, there are approximately 9,000 ophthalmic surgeons that perform cataract surgery, including approximately 3,500 to 4,000 that perform roughly 60% of premium IOL cataract procedures.
Our RxSight system has been shown to deliver excellent visual outcomes across a broad range of patient types and preferences. In our 2022 RxSight customer survey, 89% of respondents said they thought our RxSight system delivered the highest quality vision, 98% said they would recommend the LAL to others and 75% said they would select it for their own eyes.
Our RxSight system has been shown to deliver excellent visual outcomes across a broad range of patient types and preferences. In our 2024 RxSight customer survey, 92% of respondents said they thought our RxSight system delivered the highest quality vision, 97% said they would recommend the LAL to others and 82% said they would select it for their own eyes.
Most LAL patients choose minor differences in the refractive correction of each eye, resulting in glasses-free vision across a full range of distances.
Most LAL patients choose minor differences in the refractive correction of each eye, which can result in glasses-free vision across a full range of distances.
Our U.S. commercial organization includes a direct sales team of LDD sales personnel and LAL account managers, as well as clinical specialists, field service engineers and marketing personnel. Our sales efforts are concentrated on the roughly 4,000 U.S. cataract surgeons that perform 70%-80% of all premium IOL procedures.
Our U.S. commercial organization includes a direct sales team of LDD sales personnel and LAL account managers, as well as clinical specialists, field service engineers and marketing personnel. Our sales efforts are concentrated on the approximately 3,500 to 4,000 U.S. cataract surgeons that perform approximately 60% of all premium IOL procedures.
Further details on certain segments of our patent portfolio, including our owned and exclusively in-licensed issued patents and patent applications, are included below. • Our current LAL: Some of the patents directed to our current LAL include, for example, U.S. Pat. No. 9,119,710, which is expected to expire in 2026, U.S. Pat.
Further details on certain segments of our patent portfolio, including our owned and exclusively in-licensed issued patents and patent applications, are included below. • Our current LAL: Some of the patents directed to our current LAL include, for example, U.S. Pat. No. 10,470,874, which is estimated to expire in 2026, U.S. Pat.
In the United States, procedures are expected to grow at a CAGR of 4.5% to 5.9 million by 2028; • The United States is the world’s largest premium IOL market.
In the United States, procedures are expected to grow at a CAGR of 3.2% to 5.9 million by 2029; • The United States is the world’s largest premium IOL market.
In our most recent Phase IV commercial study data over 90% of patients were able to achieve 20/20 or better at distance without glasses, which is approximately twice the rate of any of the alternative IOLs.
In our most recent Phase IV commercial study data over 90% of patients were able to achieve 20/25 or better at distance without glasses, which is significantly higher than any of the alternative IOLs.
From a commercial perspective, we believe our primary competitors in the cataract IOL market are alternative premium IOL providers, including Alcon, Johnson & Johnson and Bausch + Lomb.
From a commercial perspective, we believe our primary competitors in the cataract U.S. IOL market are premium IOL providers, including Alcon and Johnson & Johnson.
Our market opportunity According to the Market Scope 2023 Premium Cataract Surgery Market Report and 2023 Market Scope IOL Report: • Approximately 31 million cataract surgeries were performed globally in 2023, including 4.7 million in the United States. The number of procedures worldwide is projected to grow at a CAGR of 3.9% to over 37 million by 2028.
Our market opportunity According to the Market Scope 2024 Premium Cataract Surgery Market Report and 2024 Market Scope IOL Report: • Approximately 32 million cataract surgeries were performed globally in 2024, including 5.1 million in the United States. The number of procedures worldwide is projected to grow at a CAGR of 3.4% to over 37 million by 2029.
The most popular premium IOLs families approved for cataract treatment are toric and multifocal Acrysof and Tecnis IOL models. According to the Market Scope 2023 Premium Report Alcon, Johnson & Johnson, Bausch + Lomb are three of the top IOL manufacturers, with an estimated 2022 revenue share of the world-wide premium IOL market of approximately 51%, 24%, and 2% respectively.
The most popular premium IOLs families approved for cataract treatment are toric and multifocal Acrysof and Tecnis IOL models. According to the Market Scope 2024 Premium Report Alcon and Johnson & Johnson are two of the top IOL manufacturers, with an estimated 2024 revenue share of the world-wide premium IOL market of approximately 44%, 24%, and 7% respectively.
No. 10,470,874, which is expected to expire in 2026, and U.S. Pat. No. 10,874,505, which is expected to expire in 2033. • Our LDD: Some of the patents directed to our LDD include, for example, U.S. Pat. No. 10,864,075, which is expected to expire in 2038, and U.S. Pat.
No. 10,874,505, which is estimated to expire in 2033, and U.S. Pat. No. 11,266,495, which is estimated to expire in 2039. • Our LDD: Some of the patents directed to our LDD include, for example, U.S. Pat. No. 10,864,075, which is estimated to expire in 2038, and U.S. Pat.
In the United States, the world’s largest premium IOL market, 2023 premium procedures represented about 21% of all cataract procedures and generated approximately $780 million in revenue, a figure that is projected to grow at a 9.5% compound annual growth rate (“CAGR”) by 2028, according to the Market Scope 2023 Premium Cataract Surgery Market Report.
In the United States, the world’s largest premium IOL market, 2024 premium procedures represented about 20% of all cataract procedures and generated approximately $810 million in revenue, a figure that is projected to grow at a 12.0% compound annual growth rate (“CAGR”) by 2029, according to the Market Scope 2024 Premium Cataract Surgery Market Report.
As of December 31, 2023, we had established an installed base of 666 LDDs in ophthalmology practices and, since our inception though December 31, 2023, surgeons have implanted over 96,000 LALs.
As of December 31, 2024, we had established an installed base of 971 LDDs in ophthalmology practices and, since our inception through December 31, 2024, surgeons have implanted over 195,000 LALs.
In a recent RxSight customer survey, 89% of doctors said they thought our RxSight system delivered the highest quality vision, 98% said they would recommend the LAL to others and 75% said they would select it for their own eyes.
In a recent RxSight customer survey conducted by Haffey & Company, 92% of doctors said they thought our RxSight system delivered the highest quality vision, 97% said they would recommend the LAL to others and 82% said they would select it for their own eyes.
Any U.S. or foreign patents issued or pending would be scheduled to expire on various dates from 2025 and 2043, without taking into account any possible patent term adjustments or extensions and assuming payment of all appropriate maintenance, renewal, annuity, and other governmental fees.
The U.S. and foreign patents issued or pending are estimated to expire from 2025 to 2044, without taking into account any possible patent term adjustments or extensions and assuming payment of all appropriate maintenance, renewal, annuity, and other governmental fees.
Our growth strategies include: • Establishing new customers and growing our installed base of LDDs. We believe our technology offers a differentiated value proposition to doctors and patients, providing us an opportunity to grow our share in the premium IOL market and increase the penetration of premium IOLs in the broader cataract surgery market.
We believe our technology offers a differentiated value proposition to doctors and patients, providing us an opportunity to grow our share in the premium 8 IOL market and increase the penetration of premium IOLs in the broader cataract surgery market.
In 2023, premium IOL procedures represented approximately 21% and 11% of cataract surgeries in the United States and worldwide, respectively; • In 2023, premium IOL revenue was approximately $2.4 billion globally and $780 million in the United States, and is expected to grow at a CAGR of 11.0% and 9.5%, respectively, through 2028.
In 2024, premium IOL procedures represented approximately 20% and 13% of cataract surgeries in the United States and worldwide, respectively; • In 2024, premium IOL revenue was approximately $2.8 billion globally and $810 million in the United States, and is expected to grow at a CAGR of 11.0% and 12.0%, respectively, through 2029.
Corporate information We were incorporated in California on March 5, 1997 as Calhoun Vision, Inc. and changed our name to RxSight, Inc. in October 2016. We reincorporated in Delaware on July 6, 2021.We maintain a website at www.rxsight.com.
Corporate information We were incorporated in California on March 5, 1997 as Calhoun Vision, Inc. and changed our name to RxSight, Inc. in October 2016. We reincorporated in Delaware on July 6, 2021. Our principal executive offices are located at 100 Columbia, Aliso Viejo, California 92656. Our telephone number is (949) 521-7830. We maintain a website at www.rxsight.com.
Additionally, LAL patients reported a low rate of glare or halo, visual side effects that are frequently reported with premium IOLs. We are conducting a 500-eye prospective, randomized, controlled multicenter Post Approval Study, which was a requirement of our Premarket Approval (“PMA”) approval. Subjects are randomized in a 2:1 ratio to receive either the LAL or a monofocal IOL.
Additionally, LAL patients reported a low rate of glare or halo, visual side effects that are frequently reported with premium IOLs. In 2024, we completed a 500-eye prospective, randomized, controlled multi-center Post Approval Study (“PAS”), which was a requirement of our Premarket Approval (“PMA”) approval.
New approvals may also be sought in large cataract markets with more complex regulatory environments such as Asia. FDA clinical studies In July 2016, we completed our FDA Phase 3 pivotal randomized clinical study of 600 subjects, designed to evaluate the safety and effectiveness of performing light treatments to correct postoperative spherical and cylindrical refractive error.
FDA clinical studies In July 2016, we completed our FDA Phase 3 pivotal randomized clinical study of 600 subjects, designed to evaluate the safety and effectiveness of performing light treatments to correct postoperative spherical and cylindrical refractive error.
Facilities Our corporate headquarters are in Aliso Viejo, California where we lease four facilities housing our headquarters, manufacturing, research and development and administrative offices. The facility leases are for approximately 121,000 square feet in the aggregate.
Facilities Our corporate headquarters are in Aliso Viejo, California where we lease four facilities housing our headquarters, manufacturing, research and development and administrative offices. The four facility leases are for approximately 150,000 square feet in the aggregate. The leases on our four facilities expire on January 31, 2031, with two options to extend for five years each.
In addition, based on an average of 9 LALs implanted per month at these practices, doctors observed a payback period of approximately nine months for the LDD, based on the current list purchase price.
In addition, based on an average of 11 LALs implanted per month at these practices, doctors observed a payback period of approximately six months for the LDD, based on the current list purchase price. Following this payback period, practices continue to reap the financial benefit of converting patients to the RxSight system.
No. 10,932,864, which is expected to expire in 2039. • Our lens adjustment procedure: Some of the patents directed to our lens adjustment procedure include, for example, U.S. Pat. No. 10,010,406, which is expected to expire in 2032, and U.S. Pat.
No. 10,932,864, which is estimated to expire in 2039. • Our lens adjustment procedure: Some of the patents directed to our lens adjustment procedure include, for example, U.S. Pat. No. 10,166,731, which is estimated to expire in 2036. • Our RxSight system accessories: A patent directed to our RxSight system accessories includes, for example, U.S. Pat.
We use the software licensed under the QAD agreement for inventory, shipping, receiving, sales order, work order, planning and financial transactions for the business. Maintenance for the software is offered by QAD and available for purchase by us on an annual basis, and such purchase was compulsory for the first year of the agreement.
Maintenance for the software is offered by QAD and available for purchase by us on an annual basis, and such purchase was compulsory for the first year of the agreement.
We sell our products in Canada through a distribution partner. Research and development Our research and development activities are focused on programs that improve clinical outcomes, improve customer experience, expand our indications for use, reduce manufacturing costs and lifecycle management.
Beyond these, we have begun sales in select foreign jurisdictions where permitted. Research and development Our research and development activities are focused on programs that improve clinical outcomes, improve customer experience, expand our indications for use, reduce manufacturing costs and lifecycle management.
FDA regulation of medical devices Unless an exemption applies, each new or significantly modified medical device we seek to commercially distribute in the United States will require either a premarket notification to the FDA requesting permission for commercial distribution under Section 510(k) of the FDCA, also referred to as a 510(k) clearance, or approval from the FDA of a PMA application.
The FDA regulates, among other things, product design and development, pre-clinical and clinical testing, manufacturing, packaging, labeling, storage, record keeping and reporting, clearance or approval, marketing, distribution, promotion, import and export, and post-marketing surveillance in the United States to assure the safety and effectiveness of medical products for their intended use. 14 FDA regulation of medical devices Unless an exemption applies, each new or significantly modified medical device we seek to commercially distribute in the United States will require either a premarket notification to the FDA requesting permission for commercial distribution under Section 510(k) of the FDCA, also referred to as a 510(k) clearance, or approval from the FDA of a PMA application.
Since our initial FDA approval in November 2017 through December 31, 2023, we have received approximately 30 supplemental approvals that advance these objectives. In January 2023, the FDA approved our PMA supplement to our compact LDD for various modifications. This LDD will also require a submission for approval in countries outside the United States.
Since our initial FDA approval in November 2017 through December 31, 2024, we have received approximately 40 supplemental approvals that advance these objectives. In January 2023, the FDA approved our PMA supplement for our compact LDD with various modifications and it was approved in Canada in September 2024 and in Korea in February 2025.
Following this payback period, practices continue to reap the financial benefit of converting patients to the RxSight system. 8 Our growth strategies We are leveraging the tangible and compelling benefits of our RxSight solution to achieve broad adoption of our technology and establish it as the standard of care for premium cataract surgery.
Our growth strategies We are leveraging the tangible and compelling benefits of our RxSight solution to achieve broad adoption of our technology and establish it as the standard of care for premium cataract surgery. Our growth strategies include: • Establishing new customers and growing our installed base of LDDs.
For example, respondents indicated that approximately 40% of their LAL patients would have otherwise selected a conventional monofocal IOL, which is far less profitable for a practice than a LAL procedure.
A recent economic impact survey by Haffey & Company, of the practices using the RxSight system revealed that LAL procedures were sourced from all other categories of other IOLs. For example, respondents indicated that approximately 40% of their LAL patients would have otherwise selected a conventional monofocal IOL, which is far less profitable for a practice than a LAL procedure.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIf we are unable to successfully market and sell our RxSight system, our business prospects will be significantly harmed, and we may be unable to achieve revenue growth. • We face significant competition, and if we are unable to compete effectively, we may not be able to achieve or maintain significant market penetration or improve our results of operations. • Global economic, political and market conditions, including downgrades of the U.S. credit rating, may adversely affect our business, results of operations and financial condition, including our revenue growth and profitability. • We currently maintain all of our cash, cash equivalents and short-term investments in one financial institution and, therefore, our cash, cash equivalents and short-term investments could be adversely affected if the financial institution in which we hold our cash, cash equivalents and short-term investments fails.
Biggest changeIf we are unable to successfully market and sell our RxSight system, our business prospects will be significantly harmed, and we may be unable to achieve revenue growth. • We face significant competition, and if we are unable to compete effectively, we may not be able to achieve or maintain significant market penetration or improve our results of operations. • We intend to expand sales of our products internationally in the future, but we may experience difficulties in obtaining regulatory clearance or approval or in successfully marketing our products internationally even if approved. • A variety of risks associated with marketing our products internationally could materially adversely affect our business. • Global economic, political and market conditions, including downgrades of the U.S. credit rating, may adversely affect our business, results of operations and financial condition, including our revenue growth and profitability. • We may experience a significant disruption in our information technology systems or breaches of data security.
Our future liquidity and capital funding requirements will depend on numerous factors, including: • our sales growth; • our research and development efforts; • our sales and marketing activities; • our success in leveraging future strategic partnerships; • working capital investments, primarily in inventories and accounts receivable; • our ability to borrow or raise additional funds through future debt or equity offerings to finance our operations; • the outcome, costs and timing of any clinical trial results for our current or future products; • the emergence and effect of competing or complementary products; • the availability and amount of reimbursement for procedures using our products; • our ability to maintain, expand, enforce and defend our intellectual property portfolio, including the amount and timing of any payments we may be required to make, or that we may receive, in connection with the licensing, filing, prosecution, maintenance, defense and enforcement of any patents or other intellectual property rights; • our ability to retain our current employees and the need and ability to hire additional management, sales, research and development, scientific and customer support personnel; 28 • the terms and timing of any collaborative, licensing or other arrangements that we have or may establish; • operating and finance lease payments for our facilities; and • the extent to which we acquire or invest in businesses, products or technologies.
Our future liquidity and capital funding requirements will depend on numerous factors, including: • our sales growth; • our research and development efforts; • our sales and marketing activities; • our success in leveraging future strategic partnerships; • working capital investments, primarily in inventories and accounts receivable; • our ability to borrow or raise additional funds through future debt or equity offerings to finance our operations; • the outcome, costs and timing of any clinical trial results for our current or future products; • the emergence and effect of competing or complementary products; • the availability and amount of reimbursement for procedures using our products; • our ability to maintain, expand, enforce and defend our intellectual property portfolio, including the amount and timing of any payments we may be required to make, or that we may receive, in connection with the licensing, filing, prosecution, maintenance, defense and enforcement of any patents or other intellectual property rights; 28 • our ability to retain our current employees and the need and ability to hire additional management, sales, research and development, scientific and customer support personnel; • the terms and timing of any collaborative, licensing or other arrangements that we have or may establish; • operating and finance lease payments for our facilities; and • the extent to which we acquire or invest in businesses, products or technologies.
The commercial success of our RxSight system and any of our planned or future products will depend on a number of factors, including the following: • the actual and perceived effectiveness and reliability of our RxSight system, especially relative to alternative products; • the prevalence and severity of any adverse patient events involving our RxSight system; • the results of clinical studies and trials relating to our RxSight system; • our ability to sustain meaningful clinical benefits for our patients; • our ability to obtain regulatory approval to market our planned or future products for use in the United States or internationally; • the availability, relative cost and perceived advantages and disadvantages of alternative technologies or treatment methods for conditions treated by our products; • the degree of patient willingness to pay for the additional costs associated with our premium intraocular lens out of pocket; • the degree to which doctors adopt our RxSight system; • the fact that governmental and private health care providers and payors around the world are increasingly utilizing managed care for the delivery of health care services, centralizing purchasing, limiting the number of vendors that may participate in purchasing programs, forming group purchasing organizations and integrated health delivery networks and pursuing consolidation to improve their purchasing leverage and using competitive bid processes to procure health care products and services; • our ability to obtain, maintain, protect and enforce our intellectual property rights in and to our RxSight system; • the degree to which patients value the customized vision delivered by the RxSight system and are satisfied with their results; • achieving and maintaining compliance with regulatory requirements applicable to our products; • the extent to which we are successful in educating doctors about IOLs in general, and the benefits of our RxSight system; • our reputation among doctors; • the strength of our marketing and commercial organization; 30 • the effectiveness of our marketing and sales efforts in the United States, including our efforts to build out our sales team; • our ability to expand the commercialization of our products into international markets; • our ability to continue to develop, validate and maintain a commercially viable manufacturing process that is compliant with the Quality Systems Regulations (“QSR”), or QSMR when it goes into effect in February 2026, and other applicable foreign, federal and state regulatory requirements; • the success of our ongoing or future clinical trials; and • whether we are required by the FDA or comparable non-U.S. regulatory authorities to conduct additional clinical trials for current or future indications.
The commercial success of our RxSight system and any of our planned or future products will depend on a number of factors, including the following: • the actual and perceived effectiveness and reliability of our RxSight system, especially relative to alternative products; • the prevalence and severity of any adverse patient events involving our RxSight system; • the results of clinical studies and trials relating to our RxSight system; • our ability to sustain meaningful clinical benefits for our patients; • our ability to obtain regulatory approval to market our planned or future products for use in the United States or internationally; • the availability, relative cost and perceived advantages and disadvantages of alternative technologies or treatment methods for conditions treated by our products; • the degree of patient willingness to pay for the additional costs associated with our premium intraocular lens out of pocket; • the degree to which doctors adopt our RxSight system; • the fact that governmental and private health care providers and payors around the world are increasingly utilizing managed care for the delivery of health care services, centralizing purchasing, limiting the number of vendors that may participate in purchasing programs, forming group purchasing organizations and integrated health delivery networks and pursuing consolidation to improve their purchasing leverage and using competitive bid processes to procure health care products and services; • our ability to obtain, maintain, protect and enforce our intellectual property rights in and to our RxSight system; • the degree to which patients value the customized vision delivered by the RxSight system and are satisfied with their results; • achieving and maintaining compliance with regulatory requirements applicable to our products; • the extent to which we are successful in educating doctors about IOLs in general, and the benefits of our RxSight system; • our reputation among doctors; 30 • the strength of our marketing and commercial organization; • the effectiveness of our marketing and sales efforts in the United States, including our efforts to build out our sales team; • our ability to expand the commercialization of our products into international markets; • our ability to continue to develop, validate and maintain a commercially viable manufacturing process that is compliant with the Quality Systems Regulations (“QSR”), or QSMR when it goes into effect in February 2026, and other applicable foreign, federal and state regulatory requirements; • the success of our ongoing or future clinical trials; and • whether we are required by the FDA or comparable non-U.S. regulatory authorities to conduct additional clinical trials for current or future indications.
Even if we are able to raise 31 awareness, doctors tend to be slow in changing their medical treatment practices and may be hesitant to select our products for recommendation to their patients for a variety of reasons, including: • long-standing relationships with competing companies and distributors that sell other products; • competitive response and negative selling efforts from providers of alternative products; • lack of experience with our products and concerns that we are relatively new to market; • lack or perceived lack of sufficient clinical evidence, including long-term data, supporting safety or clinical benefits; • time commitment and skill development that may be required to gain familiarity and proficiency with our products; • patient confusion regarding the wide range of commercially available premium IOL offerings and their ability to deliver promised results at near, middle and far distances without reliance on glasses; • patient reticence to select a premium IOL due to nonperformance and adverse side effects associated with competing products in the market; • patient non-compliance with the RxSight system requirement to wear protective glasses following surgery until the LAL is locked to avoid UV exposure and an unintended change to the LAL, resulting in patient dissatisfaction with the results and possible need to remove the LAL; and • an inability to generate patient referral due to dissatisfaction with results obtained through treatment with our products, the out-of-pocket cost of treatments using our products or otherwise.
Even if we are able to raise awareness, 31 doctors tend to be slow in changing their medical treatment practices and may be hesitant to select our products for recommendation to their patients for a variety of reasons, including: • long-standing relationships with competing companies and distributors that sell other products; • competitive response and negative selling efforts from providers of alternative products; • lack of experience with our products and concerns that we are relatively new to market; • lack or perceived lack of sufficient clinical evidence, including long-term data, supporting safety or clinical benefits; • time commitment and skill development that may be required to gain familiarity and proficiency with our products; • patient confusion regarding the wide range of commercially available premium IOL offerings and their ability to deliver promised results at near, middle and far distances without reliance on glasses; • patient reticence to select a premium IOL due to nonperformance and adverse side effects associated with competing products in the market; • patient non-compliance with the RxSight system requirement to wear protective glasses following surgery until the LAL is locked to avoid UV exposure and an unintended change to the LAL, resulting in patient dissatisfaction with the results and possible need to remove the LAL; and • an inability to generate patient referral due to dissatisfaction with results obtained through treatment with our products, the out-of-pocket cost of treatments using our products or otherwise.
Moreover, any significant delays in our product launches may significantly impede our ability to enter or compete in a given market and may reduce the sales that we are able to generate from these products. We may experience 33 delays in any phase of a product development, including during research and development, clinical trials, regulatory review, manufacturing and marketing.
Moreover, any significant delays in our product launches may significantly impede our ability to enter or compete in a given market and may reduce the sales that we are able to generate from these products. We may experience delays in any phase 33 of a product development, including during research and development, clinical trials, regulatory review, manufacturing and marketing.
We operate in four separate facilities, designated as a single manufacturing facility, and should any one of these facilities be significantly damaged or destroyed by natural or man-made disasters, such as earthquakes, fires (both of which are prevalent in California) or other events, it could take months to relocate or rebuild, during which time our employees may seek other positions, our research, development and manufacturing would cease or be delayed and our products may be unavailable.
We operate in four separate facilities, designated as a single manufacturing facility, and should any one of these facilities be significantly damaged or destroyed by natural or man-made disasters, such as earthquakes, and/or fires (both of which are prevalent in California) or other events, it could take months to relocate or rebuild, during which time our employees may seek other positions, our research, development and manufacturing would cease or be delayed and our products may be unavailable.
We may experience numerous unforeseen events during, or because of, the clinical trial process that could delay or prevent us from receiving regulatory clearance or approval for new products, modifications of existing products, or new indications for existing products, including: • successful and timely completion of nonclinical studies or clinical development of our products, as well as the associated costs, including any unforeseen costs we may incur as a result of clinical trial delays; • enrollment in our clinical trials may be slower than we anticipate, or we may experience high screen failure rates in our clinical trials, resulting in significant delays; • our clinical trials may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical and/or preclinical testing which may be expensive and time-consuming; • trial results may not meet the level of statistical significance required by the FDA or other regulatory authorities; • the FDA or similar foreign regulatory authorities may find that one or more of our products is not sufficiently safe for investigational use in humans; • the FDA or similar foreign regulatory authorities may interpret data from preclinical testing and clinical trials in different ways than we do; • there may be delays or failure in obtaining approval of our clinical trial protocols from the FDA or other regulatory authorities; 35 • there may be delays in obtaining institutional review board approvals or governmental approvals to conduct clinical trials at prospective sites; • the FDA or similar foreign regulatory authorities may find our or our suppliers’ manufacturing processes or facilities unsatisfactory; • the FDA or similar foreign regulatory authorities may change their review policies or adopt new regulations that may negatively affect or delay our ability to bring a product to market or receive approvals or clearances to treat new indications; • we may have trouble in managing multiple clinical sites; • we may have trouble finding patients to enroll in our trials; • we may experience delays in agreeing on acceptable terms with third-party research organizations and trial sites that may help us conduct the clinical trials; and • we, or regulators, may suspend or terminate our clinical trials because the participating patients are being exposed to unacceptable health risks.
We may experience numerous unforeseen events during, or because of, the clinical trial process that could delay or prevent us from receiving regulatory clearance or approval for new products, modifications of existing products, or new indications for existing products, including: • successful and timely completion of nonclinical studies or clinical development of our products, as well as the associated costs, including any unforeseen costs we may incur as a result of clinical trial delays; • enrollment in our clinical trials may be slower than we anticipate, or we may experience high screen failure rates in our clinical trials, resulting in significant delays; • our clinical trials may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical and/or preclinical testing which may be expensive and time-consuming; • trial results may not meet the level of statistical significance required by the FDA or other regulatory authorities; • the FDA or similar foreign regulatory authorities may find that one or more of our products is not sufficiently safe for investigational use in humans; • the FDA or similar foreign regulatory authorities may interpret data from preclinical testing and clinical trials in different ways than we do; • there may be delays or failure in obtaining approval of our clinical trial protocols from the FDA or other regulatory authorities; • there may be delays in obtaining institutional review board approvals or governmental approvals to conduct clinical trials at prospective sites; 35 • the FDA or similar foreign regulatory authorities may find our or our suppliers’ manufacturing processes or facilities unsatisfactory; • the FDA or similar foreign regulatory authorities may change their review policies or adopt new regulations that may negatively affect or delay our ability to bring a product to market or receive approvals or clearances to treat new indications; • we may have trouble in managing multiple clinical sites; • we may have trouble finding patients to enroll in our trials; • we may experience delays in agreeing on acceptable terms with third-party research organizations and trial sites that may help us conduct the clinical trials; and • we, or regulators, may suspend or terminate our clinical trials because the participating patients are being exposed to unacceptable health risks.
Our ability to utilize those NOLs could be limited by an “ownership change” as described above and consequently, we may not be able to utilize a material portion of our NOLs and certain other tax attributes, which could have a material adverse effect on our cash flows and results of operations. 43 Risks related to intellectual property If we are unable to obtain, maintain, protect and enforce patent and other intellectual property protection for our technology and products, or if the scope of the patent and other intellectual property protection obtained is not sufficiently broad, we may not be able to compete effectively in our markets.
Our ability to utilize those NOLs and certain other tax attributes could be limited by an “ownership change” as described above and consequently, we may not be able to utilize a material portion of our NOLs and certain other tax attributes, which could have a material adverse effect on our cash flows and results of operations. 43 Risks related to intellectual property If we are unable to obtain, maintain, protect and enforce patent and other intellectual property protection for our technology and products, or if the scope of the patent and other intellectual property protection obtained is not sufficiently broad, we may not be able to compete effectively in our markets.
With respect to both in-licensed and owned intellectual property, we cannot predict whether the patent applications we and our licensors are currently pursuing will issue as patents in any particular jurisdiction or 44 whether the claims of any issued patents will provide sufficient protection from competitors.
With respect to both in-licensed and owned intellectual property, we cannot predict whether the patent applications we and our licensors are currently pursuing will issue as patents in any particular jurisdiction or whether the claims 44 of any issued patents will provide sufficient protection from competitors.
The defense of these matters can be time consuming, be costly, divert management’s attention and resources, damage our reputation and brand and cause us to incur significant expenses or make substantial payments.
The defense of these matters can be time consuming, costly, divert management’s attention and resources, damage our reputation and brand and cause us to incur significant expenses or make substantial payments.
Collaborations are subject to numerous risks, which may include that: • collaborators have significant discretion in determining the efforts and resources that they will apply to collaborations; • collaborators may not pursue development and commercialization of our products or may elect not to continue or renew development or commercialization programs based on trial or test results, changes in their strategic focus due to the acquisition of competitive products, availability of funding or other external factors, such as a business combination that diverts resources or creates competing priorities; • collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our current and future products; • a collaborator with marketing, manufacturing and distribution rights to one or more products may not commit sufficient resources to or otherwise not perform satisfactorily in carrying out these activities; • we could grant exclusive rights to our collaborators that would prevent us from collaborating with others; • collaborators 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 liability; 52 • disputes may arise between us and a collaborator that causes the delay or termination of the research, development or commercialization of our current or future products or that results in costly litigation or arbitration that diverts management attention and resources; • collaborations may be terminated, and, if terminated, may result in a need for additional capital to pursue further development or commercialization of the applicable current or future products; • collaborators may own or co-own intellectual property covering our products that results from our collaborating with them, and in such cases, we would not have the exclusive right to develop or commercialize such intellectual property; and • a collaborator’s sales and marketing activities or other operations may not be in compliance with applicable laws resulting in civil or criminal proceedings.
Collaborations are subject to numerous risks, which may include that: • collaborators have significant discretion in determining the efforts and resources that they will apply to collaborations; • collaborators may not pursue development and commercialization of our products or may elect not to continue or renew development or commercialization programs based on trial or test results, changes in their strategic focus due to the acquisition of competitive products, availability of funding or other external factors, such as a business combination that diverts resources or creates competing priorities; • collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our current and future products; • a collaborator with marketing, manufacturing and distribution rights to one or more products may not commit sufficient resources to or otherwise not perform satisfactorily in carrying out these activities; • we could grant exclusive rights to our collaborators that would prevent us from collaborating with others; • collaborators 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 liability; • disputes may arise between us and a collaborator that causes the delay or termination of the research, development or commercialization of our current or future products or that results in costly litigation or arbitration that diverts management attention and resources; • collaborations may be terminated, and, if terminated, may result in a need for additional capital to pursue further development or commercialization of the applicable current or future products; 52 • collaborators may own or co-own intellectual property covering our products that results from our collaborating with them, and in such cases, we would not have the exclusive right to develop or commercialize such intellectual property; and • a collaborator’s sales and marketing activities or other operations may not be in compliance with applicable laws resulting in civil or criminal proceedings.
The FDA can delay, limit or deny clearance or approval of a device for many reasons, including: • our inability to demonstrate to the satisfaction of the FDA or the applicable regulatory entity or notified body that our products are safe or effective for their intended uses; • the disagreement of the FDA or the applicable foreign regulatory body with the design, conduct or implementation of our clinical trials or the analyses or interpretation of data from pre-clinical studies or clinical trials; • serious and unexpected adverse device effects experienced by participants in our clinical trials; • the data from our pre-clinical studies and clinical trials may be insufficient to support clearance or approval, where required; 57 • our inability to demonstrate that the clinical and other benefits of the device outweigh the risks; • an advisory committee, if convened by the applicable regulatory authority, may recommend against approval of our application or may recommend that the applicable regulatory authority require, as a condition of approval, additional preclinical studies or clinical trials, limitations on approved labeling or distribution and use restrictions, or even if an advisory committee, if convened, makes a favorable recommendation, the respective regulatory authority may still not approve the product; • the applicable regulatory authority may identify significant deficiencies in our manufacturing processes, facilities or analytical methods or those of our third-party contract manufacturers; • the potential for approval policies or regulations of the FDA or applicable foreign regulatory bodies to change significantly in a manner rendering our clinical data or regulatory filings insufficient for clearance or approval; and • the FDA or foreign regulatory authorities may audit our clinical trial data and conclude that the data is not sufficiently reliable to support approval or clearance.
The FDA can delay, limit or deny clearance or approval of a device for many reasons, including: • our inability to demonstrate to the satisfaction of the FDA or the applicable regulatory entity or notified body that our products are safe or effective for their intended uses; • the disagreement of the FDA or the applicable foreign regulatory body with the design, conduct or implementation of our clinical trials or the analyses or interpretation of data from pre-clinical studies or clinical trials; • serious and unexpected adverse device effects experienced by participants in our clinical trials; • the data from our pre-clinical studies and clinical trials may be insufficient to support clearance or approval, where required; • our inability to demonstrate that the clinical and other benefits of the device outweigh the risks; • an advisory committee, if convened by the applicable regulatory authority, may recommend against approval of our application or may recommend that the applicable regulatory authority require, as a condition of approval, additional preclinical studies or clinical trials, limitations on approved labeling or distribution and use restrictions, or even if an advisory committee, if convened, makes a favorable recommendation, the respective regulatory authority may still not approve the product; • the applicable regulatory authority may identify significant deficiencies in our manufacturing processes, facilities or analytical methods or those of our third-party contract manufacturers; • the potential for approval policies or regulations of the FDA or applicable foreign regulatory bodies to change significantly in a manner rendering our clinical data or regulatory filings insufficient for clearance or approval; and 57 • the FDA or foreign regulatory authorities may audit our clinical trial data and conclude that the data is not sufficiently reliable to support approval or clearance.
Environmental laws and regulations could become more stringent over time, imposing greater compliance costs and increasing risks and penalties associated with violations. We cannot assure you that violations of these laws and regulations will not occur in the future or have not occurred in the past as a result of human error, accidents, equipment failure or other causes.
Environmental laws and regulations could become more stringent over time, imposing greater compliance costs and increasing risks and penalties associated with violations. We cannot assure you that violations of these laws and regulations will not occur in the future or have not occurred in the past as a result of human error, accidents, equipment failure or other causes.
If any such actions are instituted against us and we are not successful in defending ourselves or asserting our rights, those actions could result in the imposition of significant fines or other sanctions, including the imposition of civil, criminal and administrative penalties, damages, 68 monetary fines, disgorgement, individual imprisonment, additional integrity reporting and oversight obligations, possible exclusion from participation in Medicare, Medicaid and other federal healthcare programs, contractual damages, reputational harm, diminished profits and future earnings and curtailment of operations, any of which could adversely affect our ability to operate our business and our results of operations.
If any such actions are instituted against us and we are not successful in defending ourselves or asserting our rights, those actions could result in the imposition of significant fines or other sanctions, including the imposition of civil, criminal and administrative penalties, damages, monetary fines, disgorgement, individual imprisonment, additional integrity reporting and oversight obligations, possible exclusion from participation in Medicare, Medicaid and other federal healthcare programs, contractual damages, reputational harm, diminished profits and future earnings and curtailment of operations, any of which could adversely affect our ability to operate our business and our results of operations.
Our bylaws provide that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or, if the Court of Chancery does not have jurisdiction, another State court in Delaware or the federal district court for the District of Delaware) is the exclusive forum for: • any derivative action or proceeding brought on our behalf; • any action asserting a claim of breach of fiduciary duty; 77 • any action asserting a claim against us arising under the DGCL, our amended and restated certificate of incorporation or our bylaws; and • any action asserting a claim against us that is governed by the internal-affairs doctrine.
Our bylaws provide that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or, if the Court of Chancery does not have jurisdiction, another State court in Delaware or the federal district court for the District of Delaware) is the exclusive forum for: • any derivative action or proceeding brought on our behalf; • any action asserting a claim of breach of fiduciary duty; • any action asserting a claim against us arising under the DGCL, our amended and restated certificate of incorporation or our bylaws; and • any action asserting a claim against us that is governed by the internal-affairs doctrine.
In cases where data from foreign clinical trials are intended to serve as the basis for marketing approval in the United States, the FDA will generally not approve the 61 application on the basis of foreign data alone unless (1) the data are applicable to the U.S. population and U.S. medical practice; (2) the trials are performed by clinical investigators of recognized competence and pursuant to current good clinical practices regulations; and (3) audits by regulatory authorities of the clinical data do not identify significant data integrity issues.
In cases where data from foreign clinical trials are intended to serve as the basis for marketing approval in the United States, the FDA will generally not approve the application on the basis of foreign data alone unless (1) the data are applicable to the U.S. population and U.S. medical practice; (2) the trials are performed by clinical investigators of recognized competence and pursuant to current good clinical practices regulations; and (3) audits by regulatory authorities of the clinical data do not identify significant data integrity issues.
We have a compliance program, a Code of Conduct and associated policies and procedures, but it is not always possible to identify and deter misconduct by our employees and other third parties, and the precautions we take to detect and prevent noncompliance may not be effective in protecting us from governmental investigations for failure to comply with applicable fraud and abuse or other healthcare laws and regulations.
We have a 63 compliance program, a Code of Conduct and associated policies and procedures, but it is not always possible to identify and deter misconduct by our employees and other third parties, and the precautions we take to detect and prevent noncompliance may not be effective in protecting us from governmental investigations for failure to comply with applicable fraud and abuse or other healthcare laws and regulations.
We are subject to numerous, and sometimes conflicting, legal regimes in the countries in 71 which we operate, including on matters as diverse as health and safety standards, marketing and promotional activities, anticorruption, import/export controls, content requirements, trade restrictions, tariffs, taxation, sanctions, immigration, internal and disclosure control obligations, securities regulation, anti-competition, data protection privacy, security and labor relations.
We are subject to numerous, and sometimes conflicting, legal regimes in the countries in which we operate, including on matters as diverse as health and safety standards, marketing and promotional activities, anticorruption, import/export controls, content requirements, trade restrictions, tariffs, taxation, sanctions, immigration, internal and disclosure control obligations, securities regulation, anti-competition, data protection privacy, security and labor relations.
Any violation of the FCPA or other applicable anti-bribery, anti-corruption or anti-money laundering laws could result in whistleblower complaints, adverse media coverage, investigations, loss of export privileges, severe criminal or civil sanctions and, in the case of the FCPA, suspension or debarment from U.S. government contracts, which could have a material and adverse effect on our business, financial condition and results of operations.
Any violation of the FCPA or other applicable anti-bribery, anti-corruption or anti-money laundering laws could result in whistleblower complaints, adverse media coverage, investigations, loss of export privileges, severe criminal or civil sanctions and, in the case of the FCPA, 71 suspension or debarment from U.S. government contracts, which could have a material and adverse effect on our business, financial condition and results of operations.
Government regulations specific to medical devices are wide ranging and govern, among other things: • product design, development and manufacture; • laboratory, preclinical and clinical testing, labeling, packaging, storage and distribution; • premarketing clearance or approval; • record keeping; • product safety and effective; • product changes; • product marketing, promotion and advertising, sales and distribution; and • post marketing surveillance, including reporting of deaths or serious injuries and recalls and correction and removals.
Government regulations specific to medical devices are wide ranging and govern, among other things: • product design, development and manufacture; • laboratory, preclinical and clinical testing, labeling, packaging, storage and distribution; 56 • premarketing clearance or approval; • record keeping; • product safety and effective; • product changes; • product marketing, promotion and advertising, sales and distribution; and • post marketing surveillance, including reporting of deaths or serious injuries and recalls and correction and removals.
If we fail these inspections or fail to meet these regulatory standards, it could have a material adverse effect on our business, financial condition and results of operations. We depend upon third parties, including single and sole source suppliers, to manufacture certain components and subcomponents of the RxSight system making us vulnerable to supply disruptions and price fluctuations.
If we fail these inspections or fail to meet these regulatory standards, it could have a material adverse effect on our business, financial condition and results of operations. 72 We depend upon third parties, including single and sole source suppliers, to manufacture certain components and subcomponents of the RxSight system making us vulnerable to supply disruptions and price fluctuations.
Our certificate of incorporation authorizes our Board of Directors, without the approval of our stockholders, to issue shares of our preferred stock, subject to limitations prescribed by applicable law, rules and regulations and the provisions of our amended and restated certificate of incorporation, as shares of preferred stock in series, to establish from time to time the number of shares to be included in each such series and to fix the designation, powers, preferences and rights of the shares of each such series and the qualifications, limitations or restrictions thereof.
Our certificate of incorporation authorizes our Board of Directors, without the approval of our stockholders, to issue shares of our preferred stock, subject to limitations prescribed by applicable law, rules and regulations and the provisions of our amended and restated certificate of incorporation, as shares of preferred stock in series, to establish from time to time the number of shares to be included in each such series and to fix the designation, powers, preferences and rights of the shares of each such 77 series and the qualifications, limitations or restrictions thereof.
An adverse determination in any such submission or proceeding may result in loss of exclusivity or freedom to operate or in patent claims being narrowed, invalidated or held unenforceable, in whole or in part, which could limit our ability to stop others from using or commercializing similar technology and therapeutics, without payment to us, or could limit the duration of the patent protection covering our technology.
An adverse determination in any such submission or proceeding may result in loss of exclusivity or freedom to operate or in patent claims being narrowed, invalidated or held unenforceable, in whole or in part, which could limit our ability to stop others from using or commercializing 47 similar technology and therapeutics, without payment to us, or could limit the duration of the patent protection covering our technology.
We train 59 our marketing and sales force against promoting our products for uses outside of the cleared or approved indications for use, known as “off-label uses.” However, doctors may use our products for off-label purposes and are allowed to do so when in the doctor’s independent professional medical judgment he or she deems it appropriate.
We train our marketing and sales force against promoting our products for uses outside of the cleared or approved indications for use, known as “off-label uses.” However, doctors may use our products for off-label purposes and are allowed to do so when in the doctor’s independent professional medical judgment he or she deems it appropriate.
Additionally, adverse worldwide economic conditions may also adversely impact our suppliers’ ability to provide us with materials and components, cause them to limit or place burdensome conditions upon future transactions with us, or 80 affect their ability to fulfill their respective contractual obligations to us, which could have a material adverse effect on our business, financial condition and results of operations.
Additionally, adverse worldwide economic conditions may also adversely impact our suppliers’ ability to provide us with materials and components, cause them to limit or place burdensome conditions upon future transactions with us, or affect their ability to fulfill their respective contractual obligations to us, which could have a material adverse effect on our business, financial condition and results of operations.
Our network security controls are comprised of administrative, physical and technical controls, which include, but are not limited to, the implementation of firewalls, anti-virus protection, patches, log monitors, routine backups, off-site storage, network audits and other routine updates and modifications. We also routinely monitor and develop our internal information technology systems to address risks to our information systems.
Our network security controls are comprised of administrative, physical and technical controls, which include, but are not limited to, the implementation of firewalls, anti-virus protection, patches, log monitors, routine 36 backups, off-site storage, network audits and other routine updates and modifications. We also routinely monitor and develop our internal information technology systems to address risks to our information systems.
If we are unable to successfully develop, license or acquire 37 new products, enhance our existing products to meet customer requirements or otherwise gain market acceptance, our business, financial condition and results of operations would be harmed. The typical development cycle of new medical device products can be lengthy and complicated and may require complex technology and engineering.
If we are unable to successfully develop, license or acquire new products, enhance our existing products to meet customer requirements or otherwise gain market acceptance, our business, financial condition and results of operations would be harmed. The typical development cycle of new medical device products can be lengthy and complicated and may require complex technology and engineering.
Even if we succeed in bringing our products to market internationally, uncertainties regarding future healthcare policy, legislation and regulation, as well as private market practices, could affect our ability to sell our products in commercially acceptable quantities at acceptable prices. Our quarterly and annual results may fluctuate significantly and may not fully reflect the underlying performance of our business.
Even if we succeed in bringing our products to market internationally, uncertainties regarding future healthcare policy, legislation and regulation, as well as private market practices, could affect our ability to sell our products in commercially acceptable quantities at acceptable prices. 42 Our quarterly and annual results may fluctuate significantly and may not fully reflect the underlying performance of our business.
If the FDA or a comparable foreign regulatory authority disagrees and requires new clearances or approvals for these modifications, we may be required to recall and to stop selling or marketing such products as modified, which could harm our operating results and require us to redesign such products. In these circumstances, we may be subject to significant enforcement actions.
If the 60 FDA or a comparable foreign regulatory authority disagrees and requires new clearances or approvals for these modifications, we may be required to recall and to stop selling or marketing such products as modified, which could harm our operating results and require us to redesign such products. In these circumstances, we may be subject to significant enforcement actions.
While we are currently in compliance with the EU MDR and in process of transferring certification from MDD to EU MDR, compliance with any new or changing regulations in the EU or other jurisdictions where we currently commercialize our products or intend to commercialize in the 66 future is a time consuming process that may require comprehensive quality system audits and new conformity assessment certifications for our products.
While we are currently in compliance with the EU MDR and in process of transferring certification from MDD to EU MDR, compliance with any new or changing regulations in the EU or other jurisdictions where we currently commercialize our products or intend to commercialize in the future is a time consuming process that may require comprehensive quality system audits and new conformity assessment certifications for our products.
If we fail to comply with these regulatory requirements or to obtain and maintain required approvals, our target market will be reduced and our ability to generate revenue will be diminished. Our inability to successfully enter all our desired international markets and manage business on a global scale could negatively affect our business, financial results and results of operations.
If we fail to comply with these regulatory requirements or to obtain and maintain required approvals, our target market will be reduced and 41 our ability to generate revenue will be diminished. Our inability to successfully enter all our desired international markets and manage business on a global scale could negatively affect our business, financial results and results of operations.
For any products that we may develop in the future, complying with these new regulations may result in Europe being less attractive as a “first market” destination. Marketing authorization timelines will become more protracted and the costs of operating in Europe will increase. A significantly more costly path to regulatory compliance is anticipated.
For any products that we may develop in the future, complying with these new regulations may result in Europe being less attractive as a “first market” destination. Marketing authorization timelines will become more 66 protracted and the costs of operating in Europe will increase. A significantly more costly path to regulatory compliance is anticipated.
Additionally, in the United States, California adopted the CCPA in January 2020, which requires certain companies that process information of California consumers to, among other things, provide new disclosures to California consumers and afford such consumers new abilities to exercise certain rights with respect to their personal information and opt out of certain sales of personal information, in addition to severely limiting our ability to use their information.
Additionally, in the United States, California adopted the CCPA in January 2020, which requires certain companies that process information of California consumers to, among other things, provide certain disclosures to California consumers and afford such consumers abilities to exercise certain rights with respect to their personal information and opt out of certain sales of personal information, in addition to severely limiting our ability to use their information.
We may not be able to successfully integrate any acquired personnel, operations and technologies, or effectively manage the combined business following an acquisition. Acquisitions could also result in dilutive issuances of equity securities, the use of our available cash, or the incurrence of debt, which could harm our operating results.
We may not be able to successfully integrate any acquired personnel, operations and technologies, or effectively manage the combined business following an acquisition. Acquisitions could also result in dilutive issuances of equity securities, 38 the use of our available cash, or the incurrence of debt, which could harm our operating results.
Uncertainties resulting from the initiation and continuation of patent and other intellectual property litigation or other proceedings could have a material adverse effect on our business, financial condition and results of operations. Because of the expense and uncertainty of litigation, we may not be in a position to enforce our intellectual property rights against third parties.
Uncertainties resulting from the initiation and continuation of patent and other intellectual property litigation or other proceedings could have a material adverse effect on our business, financial condition and results of operations. 49 Because of the expense and uncertainty of litigation, we may not be in a position to enforce our intellectual property rights against third parties.
Further, if patents, trademarks, copyrights, or trade secrets are successfully asserted against us, this may harm our business and result in injunctions preventing us from developing, manufacturing, marketing or selling our products, or result in obligations to pay license fees, damages, attorney fees and court costs, which could be significant.
Further, if patents, trademarks, copyrights, or trade secrets are successfully asserted against us, this may harm our business and result in injunctions preventing us from developing, manufacturing, marketing or selling our products, or result in 48 obligations to pay license fees, damages, attorney fees and court costs, which could be significant.
If the FDA or FTC determines that any of our advertising or promotional claims are misleading, not substantiated or not permissible, we may be subject to enforcement actions, including adverse publicity and warning letters, and we may be required to revise our promotional claims and make other corrections or restitutions. 58 The FDA and state authorities have broad enforcement powers.
If the FDA or FTC determines that any of our advertising or promotional claims are misleading, not substantiated or not permissible, we may be subject to enforcement actions, including adverse publicity and warning letters, and we may be required to revise our promotional claims and make other corrections or restitutions. The FDA and state authorities have broad enforcement powers.
These unauthorized products may compete with our products in such jurisdictions and take away our market share where we do not have any issued or in-licensed patents and any future patent claims or other intellectual property rights may not be effective or sufficient to prevent them from so competing.
These unauthorized products may compete with our products in such jurisdictions and take away our market share where 54 we do not have any issued or in-licensed patents and any future patent claims or other intellectual property rights may not be effective or sufficient to prevent them from so competing.
The continuing efforts of the government, insurance companies, managed care organizations and other payors of healthcare services to contain or reduce costs of healthcare may harm: • our ability to set a price that we believe is fair for our products; 63 • our ability to generate revenue and achieve or maintain profitability; and • the availability of capital.
The continuing efforts of the government, insurance companies, managed care organizations and other payors of healthcare services to contain or reduce costs of healthcare may harm: • our ability to set a price that we believe is fair for our products; • our ability to generate revenue and achieve or maintain profitability; and • the availability of capital.
If a regulatory agency discovers previously unknown problems with a product, such as adverse events of unanticipated severity or frequency, or problems with our facility where the product is manufactured or disagrees with the promotion, marketing or labeling of a product, such regulatory agency may impose restrictions on that product or us, including requiring withdrawal of the product from the market.
If a regulatory agency discovers previously unknown problems with a product, such as adverse events of unanticipated severity or frequency, or problems with our facility where the product is manufactured or disagrees with the promotion, 59 marketing or labeling of a product, such regulatory agency may impose restrictions on that product or us, including requiring withdrawal of the product from the market.
Our research and development and manufacturing operations involve the use of hazardous substances and are subject to a variety of federal, state, local and foreign environmental laws and regulations relating to the storage, use, discharge, disposal and remediation of, as well as human exposure to, hazardous substances and the sale, labeling, collection, recycling, treatment and disposal of products containing hazardous substances.
Our research and development and manufacturing operations involve the use of hazardous 68 substances and are subject to a variety of federal, state, local and foreign environmental laws and regulations relating to the storage, use, discharge, disposal and remediation of, as well as human exposure to, hazardous substances and the sale, labeling, collection, recycling, treatment and disposal of products containing hazardous substances.
If any of the above were to happen, the market price of our stock could decline significantly and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities. 76 We do not intend to pay dividends on our common stock so any returns will be limited to the value of our stock.
If any of the above were to happen, the market price of our stock could decline significantly and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities. We do not intend to pay dividends on our common stock so any returns will be limited to the value of our stock.
The theft or unauthorized use or publication of our trade secrets and other confidential business information 53 could reduce the differentiation of our products and harm our business, the value of our investment in development or business acquisitions could be reduced and third parties might make claims against us related to losses of their confidential or proprietary information.
The theft or unauthorized use or publication of our trade secrets and other confidential business information could reduce the differentiation of our products and harm our business, the value of our investment in development or business acquisitions could be reduced and third parties might make claims against us related to losses of their confidential or proprietary information.
Further, it is possible that others will independently develop the same or similar technology or otherwise obtain access to our unpatented technology, and in such cases we could not assert any trade secret rights against such parties or those to whom they communicate such trade secrets.
Further, it is possible that others will independently develop the same or similar technology or otherwise obtain access to our unpatented technology, and in such cases we could not assert any trade secret rights against such parties or those to whom they 53 communicate such trade secrets.
These recent developments have required us to review and modify the legal means by which we process personal data and may require us to make other modifications. The implementation and enforcement of the GDPR and other evolving legislation may subject us to enforcement risk and requirements to change certain of our data collection, processing and other policies and practices.
These developments have required us to review and modify the legal means by which we process personal data and may require us to make other modifications. The implementation and enforcement of the GDPR and other evolving legislation may subject us to enforcement risk and requirements to change certain of our data collection, data processing and other policies and practices.
Any of the foregoing could have a material adverse effect on our competitive position, business, financial conditions, results of operations and prospects. 45 Furthermore, our owned and in-licensed patents may be subject to a reservation of rights by one or more third parties.
Any of the foregoing could have a material adverse effect on our competitive position, business, financial conditions, results of operations and prospects. Furthermore, our owned and in-licensed patents may be subject to a reservation of rights by one or more third parties.
In some cases, we or our licensors may not be able to obtain patent protection for certain technology outside the United States. In addition, the laws of some foreign countries do not protect intellectual 54 property rights to the same extent as federal and state laws in the United States.
In some cases, we or our licensors may not be able to obtain patent protection for certain technology outside the United States. In addition, the laws of some foreign countries do not protect intellectual property rights to the same extent as federal and state laws in the United States.
Furthermore, our key component suppliers may not currently be or may not continue to be in compliance 62 with applicable regulatory requirements, which may result in manufacturing delays for our products and cause our revenue to decline. The FDA has broad post-market and regulatory enforcement powers.
Furthermore, our key component suppliers may not currently be or may not continue to be in compliance with applicable regulatory requirements, which may result in manufacturing delays for our products and cause our revenue to decline. The FDA has broad post-market and regulatory enforcement powers.
The ACA is a sweeping measure intended to expand healthcare coverage within the United States, primarily through the imposition of health insurance mandates on employers and individuals, the provision of subsidies to eligible individuals enrolled in plans offered on the health insurance exchanges and the expansion of the Medicaid program.
The ACA is a sweeping measure intended to expand healthcare coverage within the United States, primarily through the imposition of health 62 insurance mandates on employers and individuals, the provision of subsidies to eligible individuals enrolled in plans offered on the health insurance exchanges and the expansion of the Medicaid program.
The publication of our privacy policies and other statements that provide notices and representations about privacy, data protection or security can subject us to potential government or legal action if they are found to be deceptive, unfair or misrepresentative of our actual practices.
The publication of our privacy policies and other statements that provide notices and representations about privacy, data protection or security can subject us to potential government or legal action if they are found 70 to be deceptive, unfair or misrepresentative of our actual practices.
For example, this could arise if the research resulting in certain of our owned or in-licensed patent rights and technology was funded in part by the United States government. As a result, the government may have certain rights, or march-in rights, to such patent rights and technology.
For example, this could arise if the research resulting in certain of our owned or in-licensed patent rights and technology was funded in part by the United States government. As a result, the government may have certain rights, or march-in rights, to such patent 45 rights and technology.
Compliance with applicable regulatory requirements is subject to continual review and is rigorously monitored through periodic inspections by the FDA and foreign regulatory agencies. 72 Our manufacturer, component, and sub-component suppliers are also required to meet certain standards applicable to their manufacturing processes.
Compliance with applicable regulatory requirements is subject to continual review and is rigorously monitored through periodic inspections by the FDA and foreign regulatory agencies. Our manufacturer, component, and sub-component suppliers are also required to meet certain standards applicable to their manufacturing processes.
As this burden is a high one requiring us to present clear and convincing evidence as to the invalidity of any such United States patent claim, there is no 48 assurance that a court of competent jurisdiction would invalidate the claims of any such United States patent.
As this burden is a high one requiring us to present clear and convincing evidence as to the invalidity of any such United States patent claim, there is no assurance that a court of competent jurisdiction would invalidate the claims of any such United States patent.
Global economic conditions could have an adverse effect on demand for our products, including on our ability to predict future operating results and on our financial condition and operating results. If global economic conditions remain uncertain or deteriorate, it may materially impact our business, operating results and financial condition.
Global economic conditions could have an adverse effect on demand for our products, including on 79 our ability to predict future operating results and on our financial condition and operating results. If global economic conditions remain uncertain or deteriorate, it may materially impact our business, operating results and financial condition.
Furthermore, the submission of these reports has been and could be used by competitors against us in competitive situations and cause customers to delay purchase decisions or cancel orders and would harm our reputation.
Furthermore, the 61 submission of these reports has been and could be used by competitors against us in competitive situations and cause customers to delay purchase decisions or cancel orders and would harm our reputation.
Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their greater financial resources and more mature and 49 developed intellectual property portfolios.
Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their greater financial resources and more mature and developed intellectual property portfolios.
It is difficult to monitor whether our predecessors or future licensors limit their use of the technology to these uses, and we could incur substantial expenses to enforce our rights to our licensed technology in the event of misuse.
It is difficult to 51 monitor whether our predecessors or future licensors limit their use of the technology to these uses, and we could incur substantial expenses to enforce our rights to our licensed technology in the event of misuse.
Moreover, some third parties are located in markets subject to political and social risk, corruption, infrastructure problems and natural disasters, in addition to country-specific privacy, data protection and security risk given current legal and 73 regulatory environments.
Moreover, some third parties are located in markets subject to political and social risk, corruption, infrastructure problems and natural disasters, in addition to country-specific privacy, data protection and security risk given current legal and regulatory environments.
In addition, the policies of the FDA and of comparable foreign regulatory authorities may change and additional laws, regulations and government actions may be enacted that could prevent, limit, or delay regulatory approval of our product 60 candidates.
In addition, the policies of the FDA and of comparable foreign regulatory authorities may change and additional laws, regulations and government actions may be enacted that could prevent, limit, or delay regulatory approval of our product candidates.
In addition, our corporate headquarters is located in Aliso Viejo, California, near major earthquake faults and fire zones, and the ultimate impact on us for being located near major earthquake faults and fire zones and being consolidated in a certain geographical area is unknown.
In addition, our corporate headquarters is located in Aliso Viejo, California, near major earthquake faults and fire zones, and the ultimate impact on us for being located near major earthquake 80 faults and fire zones and being consolidated in a certain geographical area is unknown.
The techniques and sophistication used to conduct cyber-attacks and security breaches or other incidents, including of information technology systems, as well as the sources and targets of these attacks, may take many forms (including phishing, social engineering, denial or degradation of service attacks, ransomware, malware or other malicious code), change frequently and are often not recognized until such attacks are launched or have been in place for a period of time.
The techniques and sophistication used to conduct cyber-attacks and security breaches or other incidents, including of information technology systems, as well as the sources and targets of these attacks, may take many forms (including phishing, social engineering, denial or degradation of service attacks, sim swaps, ransomware, malware or other malicious code), change frequently and are often not recognized until such attacks are launched or have been in place for a period of time.
Any of the foregoing consequences could seriously harm our business and our financial results. 65 Achieving and sustaining compliance with applicable federal and state anti-fraud and abuse laws may prove costly.
Any of the foregoing consequences could seriously harm our business and our financial results. Achieving and sustaining compliance with applicable federal and state anti-fraud and abuse laws may prove costly.
Moreover, the ACA provides that the government may assert that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the civil False Claims Act; • the Federal False Claims Act, including its civil provisions that can be enforced by private citizens through civil whistleblower or qui tam actions, and civil monetary penalties prohibiting individuals or entities from, among other things, knowingly presenting, or causing to be presented, to the federal government, claims for payment that are false or fraudulent or making a false statement to avoid, decrease or conceal an obligation to pay money to the federal government, and/or impose exclusions from federal health care programs and/or penalties for parties who engage in such prohibited conduct; 64 • the Federal Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), which prohibits, among other things, executing or attempting to execute a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters; • HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, and their implementing regulations also impose obligations on covered entities such as health insurance plans, healthcare clearinghouses, and certain health care providers and their respective business associates and their covered subcontractors, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information; • the federal Physician Payments Sunshine Act, also referred to as the CMS Open Payments, which requires applicable manufacturers of covered drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program, with specific exceptions, to annually report to CMS information regarding certain payments and other transfers of value to covered recipients, including physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain non-physician healthcare professionals (such as physician assistants and nurse practitioners, among others) and teaching hospitals, as well as information regarding ownership and investment interests held by physicians and their immediate family members; and • analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers, state laws that require biotechnology companies to comply with the biotechnology industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government; state and local laws that require medical device manufacturers to report information related to payments and other transfers of value to doctors or marketing expenditures and require the registration of their sales representatives; state laws that require medical device companies to report information on the pricing of certain medical device products; and state and foreign laws that govern the privacy and security of health information in some circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts.
Moreover, the ACA provides that the government may assert that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the civil False Claims Act; • the Federal False Claims Act, including its civil provisions that can be enforced by private citizens through civil whistleblower or qui tam actions, and civil monetary penalties prohibiting individuals or entities from, among other things, knowingly presenting, or causing to be presented, to the federal government, claims for payment that are false or fraudulent or making a false statement to avoid, decrease or conceal an obligation to pay money to the federal government, and/or impose exclusions from federal health care programs and/or penalties for parties who engage in such prohibited conduct; • the Federal Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), which prohibits, among other things, executing or attempting to execute a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters; • HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, and their implementing regulations also impose obligations on covered entities such as health insurance plans, healthcare clearinghouses, and certain health care providers and their respective business associates and their covered subcontractors, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information; • the federal Physician Payments Sunshine Act, also referred to as the CMS Open Payments, which requires applicable manufacturers of covered drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program, with specific exceptions, to annually report to CMS information regarding certain payments and other transfers of value to covered recipients, including physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain non-physician healthcare professionals (such as physician assistants and nurse practitioners, among others) and teaching hospitals, as well as information regarding ownership and investment interests held by physicians and their immediate family members; and • analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers, state laws that require biotechnology companies to comply with the biotechnology industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government; state and local laws that require medical device manufacturers to report information related to payments and other transfers of value to doctors or marketing expenditures and require the registration of their sales representatives; state laws that require medical device companies to report information on the pricing of certain medical device products; and state and foreign laws that govern the privacy and security of health information in some circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts. 64 State and federal regulatory and enforcement agencies continue to actively investigate violations of healthcare laws and regulations, and the U.S.
In addition, we cannot assure you that any such products that are approved or cleared will be manufactured or produced economically, successfully commercialized or widely accepted in the marketplace.
In addition, we cannot assure you that any such products that are approved or cleared will be manufactured or 37 produced economically, successfully commercialized or widely accepted in the marketplace.
It is unclear how this Supreme Court decision, future litigation, and healthcare measures promulgated by the Biden administration will impact the ACA, our business, financial condition and results of operations. Complying with any new legislation or reversing changes implemented under the ACA could be time-intensive and expensive, resulting in a material adverse effect on our business.
It is unclear how this Supreme Court decision, future litigation, and healthcare measures promulgated by the new Trump administration will impact the ACA, our business, financial condition and results of operations. Complying with any new legislation or reversing changes implemented under the ACA could be time-intensive and expensive, resulting in a material adverse effect on our business.
In addition, the ability to charge patients directly for premium IOLs and associated services also varies widely across different countries and could 42 become more restricted.
In addition, the ability to charge patients directly for premium IOLs and associated services also varies widely across different countries and could become more restricted.
Clinical trials conducted in one country may not be 41 accepted by other countries, and regulatory approval in one country does not mean that regulatory approval will be obtained in any other country.
Clinical trials conducted in one country may not be accepted by other countries, and regulatory approval in one country does not mean that regulatory approval will be obtained in any other country.
Non-compliance with GDPR is subject to significant penalties, including fines of up to €20 million or 4% of total worldwide revenue, whichever is greater.
Non-compliance with the GDPR is subject to significant penalties, including fines of up to €20 million or 4% of total worldwide revenue, whichever is greater.
Our 2021 Plan and 2021 ESPP each contain an evergreen provision that may increase The number of shares available for issuance pursuant to such plans on the first day of each fiscal year. See Note 9 – Stock-Based Compensation Expense in the Notes to the consolidated financial statements included in this report.
Our 2021 Plan and 2021 ESPP each contain an evergreen provision that may increase the number of shares available for issuance pursuant to such plans on the first day of each fiscal year. See Note 8 – Stock-Based Compensation Expense in the Notes to the consolidated financial statements included in this report.
Because the interpretation and application of laws, regulations, standards and other obligations relating to privacy, data protection and security are still uncertain, it is possible that these laws, regulations, standards and other obligations may be interpreted and applied in a manner that is inconsistent with our practices and policies.
Because the interpretation and application of laws, regulations, standards and other obligations relating to privacy, data protection and security are still uncertain, it is possible that these laws, regulations, standards and other obligations may be interpreted and applied in a manner that is, or is alleged to be, inconsistent with our practices and policies.
In addition, several components, sub-assemblies and materials incorporated into our products require lengthy order lead times, and additional supplies or materials may not be available when required on terms that are acceptable to us, or at all, and our third-party manufacturers and suppliers may not be able to allocate sufficient capacity in order to meet our increased requirements, any of which could have an adverse effect on our ability to meet customer demand for our products and our business, financial condition and results of operations. 81 I tem 1B.
In addition, several components, sub-assemblies and materials incorporated into our products require lengthy order lead times, and additional supplies or materials may not be available when required on terms that are acceptable to us, or at all, and our third-party manufacturers and suppliers may not be able to allocate sufficient capacity in order to meet our increased requirements, any of which could have an adverse effect on our ability to meet customer demand for our products and our business, financial condition and results of operations.
Third parties may also gain access to users’ accounts using stolen or inferred credentials, computer malware, viruses, spamming, phishing attacks or other means, and may use such access to obtain users’ personal data or prevent use of their accounts.
Third parties may also gain access to users’ accounts using stolen or inferred credentials, computer malware, viruses, spamming, sim-swap attacks, phishing attacks or other means, and may use such access to obtain users’ personal data or prevent use of their accounts.
In addition to the factors discussed in this “Part I, Item 1A, “Risk Factors,” and elsewhere in this report, these factors include: • announcement of our results of operations and updates regarding our business; • the timing and results of preclinical studies and clinical trials of our current and future products or those of our competitors; • the success of competitive products or announcements by potential competitors of their product development efforts; • regulatory actions with respect to our products or our competitors’ products; • actual or anticipated changes in our growth rate relative to our competitors; • regulatory or legal developments in the United States and other countries; • developments or disputes concerning patent applications, issued patents or other intellectual property or proprietary rights; • the recruitment or departure of key personnel; • announcements by us or our competitors of significant acquisitions, strategic collaborations, joint ventures, collaborations or capital commitments; • actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts; • fluctuations in the valuation of companies perceived by investors to be comparable to us; • market conditions in the medical device sector; • changes in the structure of healthcare payment systems; • share price and volume fluctuations attributable to inconsistent trading volume levels of our shares; • announcement or expectation of additional financing efforts; • sales of our common stock by us, our insiders or our other stockholders; and • general economic, industry and market conditions, including global and national events, such as the conflicts in Eastern Europe, and general economic downturns.
In addition to the factors discussed in “Part I, Item 1A, “Risk Factors,” and elsewhere in this report, these factors include: • announcement of our results of operations and updates regarding our business, including financial and operational guidance; • research published by securities or industry analysts about our business and prospects; • the timing and results of preclinical studies and clinical trials of our current and future products or those of our competitors; • the success of competitive products or announcements by potential competitors of their product development efforts; 73 • regulatory actions with respect to our products or our competitors’ products; • actual or anticipated changes in our growth rate relative to our competitors; • regulatory or legal developments in the United States and other countries; • developments or disputes concerning patent applications, issued patents or other intellectual property or proprietary rights; • the recruitment or departure of key personnel; • announcements by us or our competitors of significant acquisitions, strategic collaborations, joint ventures, collaborations or capital commitments; • actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts; • fluctuations in the valuation of companies perceived by investors to be comparable to us; • market conditions in the medical device sector; • changes in the structure of healthcare payment systems; • share price and volume fluctuations attributable to inconsistent trading volume levels of our shares; • announcement or expectation of additional financing efforts; • sales of our common stock by us, our insiders or our other stockholders; and • general economic, industry and market conditions, including global and national events, such as the conflicts in Eastern Europe and the Middle East, and general economic downturns.
Under the Tax Cuts and Jobs Act (“Tax Act”), as modified by the Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, our federal NOLs generated in tax years ending after December 31, 2017 may be carried forward indefinitely, but the deductibility of such federal NOLs in tax years beginning after December 31, 2020 is limited to 80% of taxable income.
Under the Tax Cuts and Jobs Act (“Tax Act”), as modified by the Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, our federal NOLs generated in tax years ending after December 31, 2017 may be carried forward indefinitely, but the deductibility of such federal NOLs, is generally limited to 80% of taxable income.
The medical device industry is intensely competitive, subject to rapid change and significantly affected by new product introductions and other market activities of industry participants. We compete with manufacturers and distributors of premium and conventional IOLs. Our most significant competitors in the IOL field include Alcon, Johnson & Johnson Vision and Bausch + Lomb.
The medical device industry is intensely competitive, subject to rapid change and significantly affected by new product introductions and other market activities of industry participants. We compete with manufacturers and distributors of premium and conventional IOLs. Our most significant competitors in the IOL field include Alcon and Johnson & Johnson.
The number of shares to be registered represents the annual evergreen increase calculated as 4% of the outstanding shares of our common stock on the last day of fiscal year 2023 under our 2021 Plan.
The number of shares to be registered represents the annual evergreen increase calculated as 4% of the outstanding shares of our common stock on the last day of fiscal year 2024 under our 2021 Plan.
Summary Risk Factors Our following risks and uncertainties are among the most significant we face, however, the risks and uncertainties identified in this subsection are not the only ones we face and are qualified in their entirety by reference to all of the risk factors described herein: Risks related to our business and products: • We have a limited operating history, and if we fail to effectively train our sales force, increase our sales and marketing capabilities, or develop broad brand awareness in a cost-effective manner, our growth will be impeded, and our business will suffer. • We have a history of net operating losses, and we expect to continue to incur losses in the future.
However, the risks and uncertainties identified in this subsection are not the only ones we face and are qualified in their entirety by reference to all of the risk factors described herein: Risks related to our business and products: • We have a limited operating history, and if we fail to effectively train our sales force, increase our sales and marketing capabilities, or develop broad brand awareness in a cost-effective manner, our growth will be impeded, and our business will suffer. • We have a history of net operating losses, and we expect to continue to incur losses in the future.
We also face risks inherent in handling large volumes of data and in protecting the security of such data. We could be subject to attacks on our systems by outside parties or fraudulent or inappropriate behavior by our service providers or employees.
We also face risks inherent in handling large volumes of data and in protecting the security of such data. We have been and could again be subject to attacks on our systems by outside parties, or by fraudulent or inappropriate behavior by our service providers or employees.
Any such actual or perceived access, disclosure or other security breach or incident, loss, or unauthorized processing of information (whether affecting us or one of our third-party service providers) could result in legal claims and proceedings, regulatory investigations, and other proceedings and liability under laws that protect the privacy of personal information, significant regulatory penalties or other fines or remedies, and such an event could disrupt our operations, damage our reputation, and cause a loss of confidence in us and our ability to commercialize our products and 79 conduct clinical trials, which could adversely affect our reputation and delay the commercialization of our RxSight system and clinical development of our current and future products.
Any such actual or perceived access, disclosure, or other security breach or incident, loss, or unauthorized processing of information (whether affecting us or one of our third-party service providers or other third parties with whom we do business) could result in legal claims and proceedings, regulatory investigations, and other proceedings and liability under laws that protect the privacy of personal information, significant regulatory penalties or other fines or remedies, and such an event could disrupt our operations, damage our reputation, and cause a loss of confidence in us and our ability to commercialize our products and conduct clinical trials, which could adversely affect our reputation and delay the commercialization of our RxSight system and clinical development of our current and future products.
The following examples are illustrative: • others may be able to make a product that is similar to our current products and future products we intend to commercialize and that is not covered by the patents that we own or exclusively in-license and have the right to enforce; • we and any of our current or future licensors or collaborators might not have been the first to make the inventions covered by the issued patents or pending patent applications that we own, license or may own or license in the future; • we or any of our current or future licensors or collaborators might not have been the first to file patent applications covering certain of our inventions; • others may independently develop similar or alternative technologies or duplicate any of our technologies without infringing, misappropriating or otherwise violating our intellectual property rights; • it is possible that our current or future owned or in-licensed patent applications will not lead to issued patents; • issued patents that we own or in-license may not provide us with any competitive advantages, or may be held invalid or unenforceable as a result of legal challenges, including as a result of legal challenges by our competitors; 55 • our competitors might conduct research and development activities in the United States and other countries that provide a safe harbor from patent infringement claims for certain research and development activities, as well as in countries where we do not have patent rights, and then use the information learned from such activities to develop competitive products for sale in our major commercial markets; • we may not develop additional proprietary technologies that are patentable; and • we may choose not to file a patent for certain trade secrets or know-how, and a third party may subsequently file a patent covering such intellectual property.
The following examples are illustrative: • others may be able to make a product that is similar to our current products and future products we intend to commercialize and that is not covered by the patents that we own or exclusively in-license and have the right to enforce; • we and any of our current or future licensors or collaborators might not have been the first to make the inventions covered by the issued patents or pending patent applications that we own, license or may own or license in the future; • we or any of our current or future licensors or collaborators might not have been the first to file patent applications covering certain of our inventions; • others may independently develop similar or alternative technologies or duplicate any of our technologies without infringing, misappropriating or otherwise violating our intellectual property rights; • it is possible that our current or future owned or in-licensed patent applications will not lead to issued patents; • issued patents that we own or in-license may not provide us with any competitive advantages, or may be held invalid or unenforceable as a result of legal challenges, including as a result of legal challenges by our competitors; • our competitors might conduct research and development activities in the United States and other countries that provide a safe harbor from patent infringement claims for certain research and development activities, as well as in countries where we do not have patent rights, and then use the information learned from such activities to develop competitive products for sale in our major commercial markets; • we may not develop additional proprietary technologies that are patentable; and • we may choose not to file a patent for certain trade secrets or know-how, and a third party may subsequently file a patent covering such intellectual property. 55 Our use of “open source” software could subject our proprietary software to general release, adversely affect our ability to sell our products and subject us to possible litigation.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe conduct periodic risk assessments to identify cybersecurity threats that may affect information systems that may be vulnerable to cybersecurity threats. These risk assessments include identification of reasonably foreseeable internal and external risks and the sufficiency of existing policies, procedures, systems, and safeguards in place to manage such risks.
Biggest changeThese risk assessments include identification of reasonably foreseeable internal and external risks and the sufficiency of existing policies, procedures, systems, and safeguards in place to manage such risks. 81 Following these risk assessments, if necessary, we implement and maintain reasonable safeguards to minimize identified risks and regularly monitor the effectiveness of our safeguards.
For additional information regarding whether any risks from cybersecurity threats have materially affected or are reasonably likely to materially affect our company, including our business strategy, results of operations, or financial condition, please refer to Item 1A, “Risk Factors,” in this report, including the risk factor entitled “We may experience a significant disruption in our information technology systems or breaches of data security” and “Unauthorized third parties may seek to access our devices or other products and services, or related devices, products, and services, and modify or use them in a way inconsistent with our FDA clearances and approvals, which may create risks to users.” As of the date of this report, we do not believe that we have experienced a material cybersecurity incident. 82
For additional information regarding whether any risks from cybersecurity threats have materially affected or are reasonably likely to materially affect our company, including our business strategy, results of operations, or financial condition, please refer to Item 1A, “Risk Factors,” in this report, including the risk factor entitled “We may experience a significant disruption in our information technology systems or breaches of data security” and “Unauthorized third parties may seek to access our devices or other products and services, or related devices, products, and services, and modify or use them in a way inconsistent with our FDA clearances and approvals, which may create risks to users.” As of the date of this report, we do not believe that we have experienced a material cybersecurity incident.
Personnel at all levels and departments are made aware of our cybersecurity policies and risks through communication and trainings. We have engaged, and expect to continue to engage, consultants, or other third parties in connection with our risk assessment processes.
Personnel at all levels and departments are made aware of our cybersecurity policies and risks through communication and training. We have engaged , and expect to continue to engage, consultants, or other third parties in connection with our risk assessment processes.
Personnel tasked with managing cybersecurity risks periodically report to senior management and the Audit Committee. We use automated tools and trained personnel to maintain real-time threat monitoring and 24x7 alerting of all of our IT infrastructure and endpoints. We leverage various software tools, internal personnel and consultants to identify, triage, escalate and remediate threats.
We use automated tools and trained personnel to maintain real-time threat monitoring and 24x7 alerting of all of our IT infrastructure and endpoints. We leverage various software tools, internal personnel and consultants to identify, triage, escalate and remediate threats.
Following these risk assessments, if necessary, we implement and maintain reasonable safeguards to minimize identified risks and regularly monitor the effectiveness of our safeguards. We devote significant resources, including engaging experienced consultants and designate senior-level information technology management (“IT management”) to manage the risk assessment and mitigation process.
We devote significant resources, including engaging experienced consultants and designate senior-level information technology management (“IT management”) to manage the risk assessment and mitigation process. Personnel tasked with managing cybersecurity risks periodically report to senior management and the Audit Committee.
Added
We conduct periodic risk assessments to identify cybersecurity threats that may affect information systems that may be vulnerable to cybersecurity threats.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties. We currently lease four facilities which includes our headquarters, manufacturing, research and development and administrative offices in Aliso Viejo, California. The facility leases are for approximately 121,000 square feet in the aggregate.
Biggest changeItem 2. Properties. We currently lease four facilities which includes our headquarters, manufacturing, research and development and administrative offices in Aliso Viejo, California. The facility leases are for approximately 150,000 square feet in the aggregate. The current leases on our four facilities expire on January 31, 2031, with two options to extend for five years each.
Removed
The leases terminate, respectively, on (i) September 30, 2024, with one option to extend for five years; (ii) January 31, 2026, with three options to extend for five years each; (iii) March 31, 2025 with two options to extend for five years each; and (iv) August 31, 2024, with one option to extend for five years.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings. From time to time, we may become involved in litigation or other legal proceedings. Except as indicated above, we are not currently a party to any litigation or legal proceedings that, in the opinion of our management, are likely to have a material adverse effect on our business.
Biggest changeItem 3. Legal Proceedings. From time to time, we may become involved in litigation or other legal proceedings. We are not currently a party to any litigation or legal proceedings that, in the opinion of our management, are likely to have a material adverse effect on our business.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changePrior to that time, there was no public market for our common stock. Stockholders As of February 15, 2024, there were approximately 150 registered stockholders of record of our common stock.
Biggest changePrior to that time, there was no public market for our common stock. Stockholders As of February 14, 2025, there were approximately 110 registered stockholders of record of our common stock.
Item 4. Mine Safety Disclosures. None 83 PART II It em 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market information and holders Our common stock has been publicly traded on the Nasdaq Global Market under the symbol “RXST” since July 30, 2021.
Item 4. Mine Safety Disclosures. None 82 PART II It em 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market information and holders Our common stock has been publicly traded on the Nasdaq Global Market under the symbol “RXST” since July 30, 2021.
Removed
Issuer purchases of equity securities None. Item 6. [ Reserved] 84
Added
Issuer purchases of equity securities None. 83 Stock Performance Graph This performance graph shall not be deemed “soliciting material” or to be “filed” with the SEC for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any filing of ours under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
Added
The following graph compares the performance of our common stock for the periods indicated with the performance of the S&P Healthcare and Supplies Index, the Russell 2000 Index, and the NASDAQ Composite Index from July 30, 2021 to December 31, 2024.
Added
This graph assumes an investment of $100 on July 30, 2021 in each of our common stock, the NASDAQ Composite Index, and the S & P Healthcare Equipment and Supplies Index, and assumes reinvestment of dividends, if any. The stock price performance shown on the graph below is not necessarily indicative of future stock price performance.

Item 7. Management's Discussion & Analysis

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

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Biggest changeComprehensive loss is defined as the change in equity during a period from transactions and other events and circumstances from non-owner sources, including unrealized gains and losses on short-term investments and foreign currency translation adjustments. 88 Results of operations Comparison of the years ended December 31, 2023 and 2022 The following table summarizes our results of operations for the years ended December 31, 2023 and 2022, together with the dollar increase or decrease and percentage change in those items: Year Ended December 31, Change (in thousands, except percentages) 2023 2022 ($) (%) Sales $ 89,077 $ 49,005 $ 40,072 81.8 % Cost of sales 35,312 27,677 7,635 27.6 Gross profit $ 53,765 $ 21,328 $ 32,437 152.1 % Operating expenses: Selling, general and administrative 74,799 58,665 16,134 27.5 Research and development 29,051 25,981 3,070 11.8 Total operating expenses 103,850 84,646 19,204 22.7 Loss from operations $ (50,085 ) $ (63,318 ) 13,233 (20.9 )% Other income (expense), net: Interest expense (3,308 ) (4,946 ) 1,638 (33.1 ) Interest and other income 6,574 1,517 5,057 333.4 Loss on extinguishment of term loan (1,769 ) — (1,769 ) — Total other income (expense), net: 1,497 (3,429 ) 4,926 (143.7 )% Loss before income taxes (48,588 ) (66,747 ) 18,159 (27.2 ) Income tax expense 20 9 11 121.0 Net loss $ (48,608 ) $ (66,756 ) $ 18,148 (27.2 )% Other comprehensive loss Unrealized gain (loss) on short-term investments 83 (66 ) 149 (226.3 ) Foreign currency translation gain (loss) 7 (9 ) 16 (176.5 ) Total other comprehensive income (loss) 90 (75 ) 165 (220.2 ) Comprehensive loss $ (48,518 ) $ (66,831 ) $ 18,313 (27.4 )% Sales Sales increased by $40.1 million, or 81.8%, to $89.1 million for the year ended December 31, 2023 from $49.0 million for the year ended December 31, 2022.
Biggest changeComprehensive loss is defined as the change in equity during a period from transactions and other events and circumstances from non-owner sources, including unrealized gains and losses on short-term investments and foreign currency translation adjustments. 88 Results of operations Comparison of the years ended December 31, 2024 and 2023 The following table summarizes our results of operations for the years ended December 31, 2024 and 2023, together with the dollar increase or decrease and percentage change in those items: Twelve Months Ended December 31, Change (in thousands, except percentages) 2024 2023 ($) (%) Sales $ 139,927 $ 89,077 $ 50,850 57.1 % Cost of sales 40,984 35,312 5,672 16.1 Gross profit $ 98,943 $ 53,765 $ 45,178 84.0 % Operating expenses: Selling, general and administrative 101,434 74,799 26,635 35.6 Research and development 34,367 29,051 5,316 18.3 Total operating expenses 135,801 103,850 31,951 30.8 Loss from operations $ (36,858 ) $ (50,085 ) $ 13,227 (26.4 )% Other income (expense), net: Interest expense (21 ) (3,308 ) 3,287 (99.4 ) Interest and other income 9,474 6,574 2,900 44.1 Loss on extinguishment of term loan — (1,769 ) 1,769 — Total other income (expense), net: 9,453 1,497 7,956 531.4 % Loss before income taxes (27,405 ) (48,588 ) 21,183 (43.6 ) Income tax expense 50 20 30 151.6 Net loss $ (27,455 ) $ (48,608 ) $ 21,153 (43.5 )% Other comprehensive income (loss) Unrealized gain on short-term investments 180 83 97 117.0 Foreign currency translation (loss) gain (9 ) 7 (16 ) (229.7 ) Total other comprehensive income (loss) 171 90 81 90.0 Comprehensive loss $ (27,284 ) $ (48,518 ) $ 21,234 (43.8 )% Sales Sales increased by $50.8 million, or 57.1%, to $139.9 million for the year ended December 31, 2024 from $89.1 million for the year ended December 31, 2023.
Interest expense Interest expense consist primarily of interest incurred on indebtedness and non-cash interest related to the amortization of debt discount and issuance costs associated with indebtedness and interest on leases. Interest and other income, net Interest and other income, net consist primarily of interest income earned on our short-term investments and cash equivalents.
Interest expense Interest expense consist primarily of interest incurred on indebtedness and non-cash interest related to the amortization of debt discount and issuance costs associated with our indebtedness and interest on leases. Interest and other income, net Interest and other income, net consist primarily of interest income earned on our short-term investments and cash equivalents.
Although, based on our current planned operations, we do not anticipate the need to raise additional capital or incur additional debt in order to reach profit from operations, as the same may be disclosed in the Company’s future Annual Reports on Form 10-K or Quarterly Reports on Form 10-Q filed with the SEC, we may be required to raise additional capital through public or private equity offerings or debt financings, credit or loan facilities or by entering into partnerships or a combination of one or 91 more of these funding sources in order to meet our liquidity requirements.
Although, based on our current planned operations, we do not anticipate the need to raise additional capital or incur additional debt in order to reach profit from operations, as the same may be disclosed in the Company’s future Annual Reports on Form 10-K or Quarterly Reports on Form 10-Q filed with the SEC, we may be required to raise additional capital through public or private equity offerings or debt financings, credit or loan facilities or by entering into partnerships or a combination of one or more of these funding sources in order to meet our liquidity requirements.
Additionally, as a public company, we have incurred and expect to continue to incur increased costs for employee-related expenses, director and officer insurance premiums, audit fees, (including costs for compliance with Section 404(b) of the Sarbanes-Oxley Act), legal fees, investor relations fees and fees to members of our Board and expenses for compliance with public-company reporting requirements.
Additionally, as a public company, we have incurred and expect to continue to incur increased costs for employee-related expenses, director and officer insurance premiums, audit fees, (including costs for compliance with Section 404(b) of the Sarbanes-Oxley Act), legal fees, investor relations fees, fees to members of our Board of directors and expenses for compliance with public-company reporting requirements.
New approvals may also be sought in large foreign cataract markets with more complex regulatory processes such as Asia. We are a Delaware corporation headquartered in Aliso Viejo, California with one wholly owned subsidiary located in Amsterdam, Netherlands. The wholly owned subsidiary has a registered branch in the United Kingdom and a wholly owned subsidiary located in Germany.
New approvals may also be sought in large foreign cataract markets with more complex regulatory processes such as Asia and Europe. We are a Delaware corporation headquartered in Aliso Viejo, California with one wholly owned subsidiary located in Amsterdam, Netherlands. The wholly owned subsidiary has a registered branch in the United Kingdom and a wholly owned subsidiary located in Germany.
Revenue recognition Our revenue is generated from the sale of LALs used in cataract surgery along with a specifically designed machine for delivering light to the eye, the LDD, to adjust the lens post-surgery. Revenue is recognized from sales of products in the U.S. Canada and Europe to ambulatory surgery centers, hospitals, and physician private practices.
Revenue recognition Our revenue is generated from the sale of LALs used in cataract surgery along with a specifically designed machine for delivering light to the eye, the LDD, to adjust the lens post-surgery. Revenue is recognized from sales of products in the U.S. Canada, Europe and Asia to ambulatory surgery centers, hospitals, and physician private practices.
We expect revenue to increase in absolute dollars as we expand our sales organization and sales territories, add customers, 86 expand the base of doctors that are trained to use our products, and expand awareness of our products with new and existing customers and as doctors perform more procedures using our products. LALs are held at customer sites on consignment.
We expect revenue to increase in absolute dollars as we expand our sales organization and sales territories, add customers, expand the base of doctors that are trained to use our products, and expand awareness of our products with new and existing customers and as doctors perform more procedures using our products. LALs are held at customer sites on consignment.
To continue to strengthen our competitive position in the premium IOL market, our research and development activities are focused primarily on programs that improve clinical outcomes, improve customer experience, expand our indications for use, reduce manufacturing costs and lifecycle management.
To continue to 85 strengthen our competitive position in the premium IOL market, our research and development activities are focused primarily on programs that improve clinical outcomes, improve customer experience, expand our indications for use, reduce manufacturing costs and lifecycle management.
Our commercial efforts began in 2019 and have been primarily focused in the United States, where we are building a “razor and razor blade” business model to drive new customer adoption and ongoing LAL volume growth.
Our commercial efforts began in late 2019 and have been primarily focused in the United States, where we are building a “razor and razor blade” business model to drive new customer adoption and ongoing LAL volume growth.
We plan to grow our business primarily by expanding the size of our LDD installed base and driving increased 85 utilization of our LAL through heightened awareness of the superior clinical outcomes that our RxSight system provides patients.
We plan to grow our business primarily by expanding the size of our LDD installed base and driving increased utilization of our LAL through heightened awareness of the superior clinical outcomes that our RxSight system provides patients.
GAAP”). The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported expenses incurred during the reporting periods.
The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported expenses incurred during the reporting periods.
The expansion of global lead times has resulted in the lack of availability of raw materials, including semiconductors, computers, monitors electronic parts, metals, packaging, adhesives, chemicals, resins and subcontract painted components.
The expansion of global lead times has resulted in the lack of availability of raw materials, including 93 semiconductors, computers, monitors electronic parts, metals, packaging, adhesives, chemicals, resins and subcontract painted components.
Uncertain macroeconomic conditions including recent inflationary pressures and the rise in interest rates have created significant uncertainty in the U.S. economy and capital markets, which is expected to continue through 2024 and beyond and could negatively impact our financial results and liquidity.
Uncertain macroeconomic conditions including recent inflationary pressures and the rise in interest rates have created significant uncertainty in the U.S. economy and capital markets, which is expected to continue through 2025 and beyond and could negatively impact our financial results and liquidity.
Cash (used in) provided by investing activities Net cash used in investing activities for the year ended December 31, 2023 was $22.1 million, consisting of net purchases of short-term investments of $17.3 million and purchases of property and equipment of $4.8 million.
Net cash used in investing activities for the year ended December 31, 2023 was $22.1 million, consisting of net purchases of short-term investments of $17.3 million and purchases of property and equipment of $4.8 million.
Funding requirements Our future liquidity and capital funding requirements will depend on numerous factors, including: • our sales growth; • our research and development efforts; • our sales and marketing activities; • our success in leveraging future strategic partnerships; • working capital investments, primarily in inventories and accounts receivable; • our ability to borrow or raise additional funds through future debt or equity offerings to finance our operations; • the outcome, costs and timing of any clinical trial results for our current or future products; • the emergence and effect of competing or complementary products; • our ability to maintain, expand, enforce and defend our intellectual property portfolio, including the amount and timing of any payments we may be required to make, or that we may receive, in connection with the licensing, filing, prosecution, maintenance, defense and enforcement of any patents or other intellectual property rights; • our ability to retain our current employees and the need and ability to hire additional management, sales, research and development, scientific and customer support personnel; • the terms and timing of any collaborative, licensing or other arrangements that we have or may establish; • operating and finance lease payments for our facilities; and • the extent to which we acquire or invest in businesses, products or technologies.
Funding requirements Our future liquidity and capital funding requirements will depend on numerous factors, including: • our sales growth, including potential international expansion; • our research and development efforts; • our sales and marketing activities; • working capital investments, primarily in inventories and accounts receivable; • our ability to raise additional funds or borrow to finance our operations; • the outcome, costs and timing of any clinical trial results for our current or future products; • the emergence and effect of competing or complementary products; • our ability to maintain, expand, enforce and defend our intellectual property portfolio, including the amount and timing of any payments we may be required to make, or that we may receive, in connection with the licensing, filing, prosecution, maintenance, defense and enforcement of any patents or other intellectual property rights; • our ability to retain our current employees and the need and ability to hire additional management, sales, research and development, scientific and customer support personnel; • the terms and timing of any collaborative, licensing or other arrangements that we have or may establish; • operating and finance lease payments for our facilities; and • the extent to which we acquire or invest in businesses, products or technologies.
Gross margin increased to 60.4% in the year ended December 31, 2023 from 43.5% in 2022 primarily due to improved operating leverage, favorable product mix from a greater percentage of revenue from LAL sales and increased margins on our LDD due to lower material costs from the introduction of our compact LDD during the third quarter of 2023.
Gross margin increased to 70.7% in the year ended December 31, 2024 from 60.4% in 2023 primarily due to improved operating leverage, favorable product mix from a greater percentage of revenue from LAL sales and increased margins on our LDD due to lower material costs from the introduction of our compact LDD during the third quarter of 2023.
As of December 31, 2023, we had established an installed base of 666 LDDs in ophthalmology practices and, since our inception though December 31, 2023, surgeons have implanted over 96,000 LALs. We believe this business model provides an attractive and concentrated market opportunity addressable with a focused sales force.
As of December 31, 2024, we had established an installed base of 971 LDDs in ophthalmology practices and, since our inception though December 31, 2024, surgeons have implanted over 195,000 LALs. We believe this business model provides an attractive and concentrated market opportunity addressable with a focused sales force.
Our United States commercial organization includes a direct sales team of LDD sales personnel and LAL account managers, as well as clinical specialists, field service engineers and marketing personnel. Our sales efforts are concentrated on the roughly 4,000 U.S. cataract surgeons that perform 70%-80% of all premium IOL procedures.
Our United States commercial organization includes a direct sales team of LDD sales personnel and LAL account managers, as well as clinical specialists, field service engineers and marketing personnel. Our sales efforts are concentrated on the roughly 3,500 to 4,000 U.S. cataract surgeons that perform approximately 60% of all premium IOL procedures.
As of December 31, 2023, we had cash and cash equivalents of $9.7 million, short-term investments of $117.5 million, and an accumulated deficit of $594.6 million. We believe that our current cash, cash equivalents and short-term investments through the date of filing of this report will be sufficient to fund our operations for at least the next 12 months.
As of December 31, 2024, we had cash and cash equivalents of $16.7 million, short-term investments of $220.5 million, and an accumulated deficit of $622.1 million. We believe that our current cash, cash equivalents and short-term investments through the date of filing of this report will be sufficient to fund our operations for at least the next 12 months.
The RxSight system is comprised of our RxSight Light Adjustable Lens ® (“LAL” ® ), RxSight Light Delivery Device (“LDD”™) and accessories. Our LAL is a premium intraocular lens (“IOL”) made of proprietary photosensitive material that changes shape in response to specific patterns of ultraviolet (“UV”) light generated by our LDD.
The RxSight system is comprised of our RxSight Light Adjustable Lens™ (“LAL™” and “LAL+ ® ”, collectively the “LAL”), RxSight Light Delivery Device (“LDD™”), and accessories. Our LAL's are premium intraocular lens (“IOL”) made of proprietary photosensitive material that changes shape in response to specific patterns of ultraviolet (“UV”) light generated by our LDD.
This increase was primarily attributable to an increase in selling and marketing personnel costs of $12.5 million due mainly to additional headcount of 29, increased sales commissions, incentive bonuses and employee benefits of $7.5 million, $2.0 million of increased stock-based compensation expense, $0.9 million in additional post market study costs, and new customer acquisition costs, in each case when compared to the year ended December 31, 2022.
This increase was primarily attributable to an increase in selling and marketing personnel costs of $19.4 million due mainly to additional headcount of 44, increased sales commissions, incentive bonuses and employee benefits of $9.4 million, $3.2 million of increased stock-based compensation expense, $3.7 million in additional marketing study costs, and new customer acquisition costs, in each case when compared to the year ended December 31, 2023.
Additionally, due to these supply chain constraints we will identify and qualify new vendors or substitute components which requires testing, validations and documentation adding to internal costs and diverting engineering resources from other projects.
Additionally, we identify and qualify new suppliers to mitigate risk due to single and sole source suppliers and to alleviate supply chain constraints we will identify and qualify new vendors or substitute components which requires testing, validations and documentation adding to internal costs and diverting engineering resources from other projects.
If we determine that we need to raise additional funds, we may do so through equity or debt financings, which may not be available to us when needed or on terms that we deem to be favorable.
If we determine that we need to raise additional funds, which may not be available to us when needed or on terms that we deem to be favorable.
If we are unable to maintain sufficient financial resources, our business, financial condition and results of operations will be materially and adversely affected, including potentially requiring us to delay, limit, reduce or terminate certain of our product discovery and development activities or future commercialization efforts.
If we are unable to maintain sufficient financial resources, our business, financial condition and results of operations will be materially and adversely affected, including potentially requiring us to delay, limit, reduce or terminate certain of our product discovery and development activities or future commercialization efforts. If we raise additional funds by issuing equity securities, our stockholders may experience dilution.
Cost of sales Cost of sales increased by $7.6 million, or 27.6%, to $35.3 million for the year ended December 31, 2023 from $27.7 million for the year ended December 31, 2022, primarily due to the increase in the number of LALs and LDDs sold during the period.
Cost of sales Cost of sales increased by $5.7 million, or 16.1%, to $41.0 million for the year ended December 31, 2024 from $35.3 million for the year ended December 31, 2023, primarily due to the increase in the number of LALs and LDDs sold during the period.
Net cash used in operating activities for the year ended December 31, 2022 was $58.8 million, consisting primarily of a net loss of $66.8 million, a change in operating assets and liabilities of $7.4 million, partially offset by non-cash stock-based compensation of $11.4 million, and depreciation and amortization of $3.9 million.
Net cash used in operating activities for the year ended December 31, 2023 was $41.6 million consisting primarily of a net loss of $48.6 million, a change in operating assets and liabilities of $9.1 million, partially offset by non-cash stock-based compensation of $15.7 million, and depreciation and amortization of $4.1 million.
Under the terms of the underwriting agreement, we also granted the underwriters an option exercisable for 30 days from the date of the underwriting agreement to purchase up to an additional 600,000 shares of common stock on the same terms and conditions. The public offering closed on February 10, 2023.
Under the terms of the underwriting agreement, we also granted the underwriters an option exercisable for 30 days from the date of the underwriting agreement to purchase up to an additional 267,857 shares of common stock on the same terms and conditions.
On February 7, 2023, we entered into an underwriting agreement with BofA Securities, Inc., pursuant to which we agreed to issue and sell 4,000,000 shares of our common stock in a public offering, pursuant to the shelf registration statement. The shares of common stock were sold at a price to the public of $12.50 per share.
Public Offering On May 8, 2024, we entered into an underwriting agreement with BofA Securities, Inc., in which we agreed to issue and sell 1,785,714 shares of our common stock in a Public Offering, pursuant to the shelf registration statement. The shares of common stock were sold at a price to the public of $56.00 per share.
Summary statement of cash flows The following table sets forth the primary sources and uses of cash, cash equivalents, and restricted cash for each of the periods presented below: For the Year Ended December 31, 2023 2022 Net cash (used in) provided by: Operating activities $ (41,593 ) $ (58,850 ) Investing activities (22,129 ) 39,950 Financing activities 61,524 6,332 Effect of foreign exchange rate on cash, cash equivalents and restricted cash 6 (9 ) Net (decrease) in cash, cash equivalents and restricted cash $ (2,192 ) $ (12,577 ) Cash used in operating activities Net cash used in operating activities for the year ended December 31, 2023 was $41.6 million consisting primarily of a net loss of $48.6 million, a change in operating assets and liabilities of $9.1 million, partially offset by non-cash stock-based compensation of $15.7 million, and depreciation and amortization of $4.1 million.
Summary statement of cash flows The following table sets forth the primary sources and uses of cash, cash equivalents, and restricted cash for each of the periods presented below (in thousands): For the Year Ended December 31, 2024 2023 Net cash (used in) provided by: Operating activities $ (16,946 ) $ (41,593 ) Investing activities (99,311 ) (22,129 ) Financing activities 123,319 61,524 Effect of foreign exchange rate on cash, cash equivalents and restricted cash (9 ) 6 Net increase (decrease) in cash, cash equivalents and restricted cash $ 7,053 $ (2,192 ) Cash used in operating activities Net cash used in operating activities for the year ended December 31, 2024 was $17.0 million consisting primarily of a net loss of $27.5 million, a change in operating assets and liabilities of $9.2 million, partially offset by non-cash stock-based compensation of $24.6 million, and depreciation and amortization of $3.6 million.
While our significant accounting policies are described in more detail in the “Summary of Accounting Polices” in Note 2 in the Notes to Consolidated Financial Statements included in Part II - Item 8 in this report, we believe that the following accounting policies are those most critical to the judgments and estimates used in the preparation of our consolidated financial statements.
Our significant accounting policies are described in more detail in the “Summary of Accounting Polices” in Note 2 in the Notes to Consolidated Financial Statements included in Part II – Item 8 in this report.
The increase was due to incremental sales of 29,589 LALs primarily due to an increased LDD installed base of 266 and incremental sales of 71 LDDs from strong adoption of our RxSight technology by practices and doctors.
The increase was due to incremental sales of 43,182 LALs primarily due to continued penetration in existing customers, an increased LDD installed base of 305 and incremental sales of 39 LDDs from strong adoption of our RxSight technology by practices and doctors.
This change was primarily due to increased interest income of $5.1 million from higher interest rates earned on higher short-term investment balances and decreased interest expense of $1.6 million on the Oxford term loan, which were offset by an increase of $1.8 million loss from extinguishment of term loan due to the repayment of the Oxford debt.
This change was primarily due to increased interest income of $2.9 million primarily from higher short-term investment balances and decreased interest expense of $3.3 million on the Oxford term loan and a decrease of $1.8 million loss from extinguishment of term loan due to the repayment of the Oxford debt.
We may not yet be able to accurately assess seasonality and other trends, and we will continue to evaluate our business in the future using these and other financial metrics as we observe trends in our business.
We may not yet be able to accurately assess seasonality and other trends, and we will continue to evaluate our business in the future using these and other financial metrics as we observe trends in our business. Our quarterly and annual financial results may fluctuate as a result of a variety of factors many of which are outside our control.
Operating expenses Selling, general and administrative expenses Selling, general and administrative (“SG&A”), expenses consist primarily of personnel-related expenses, including wages, incentive bonuses, stock-based compensation and benefits related to administrative, selling and marketing functions, education programs for doctors, commercial operations and analytics, finance, information technology and human resource functions.
As our manufacturing volume of the LAL increases and the percentage of revenue from the LAL increases as a percentage of sales, we expect gross margin may continue to improve. 87 Operating expenses Selling, general and administrative expenses Selling, general and administrative (“SG&A”), expenses consist primarily of personnel-related expenses, including wages, incentive bonuses, stock-based compensation and benefits related to administrative, selling and marketing functions, education programs for doctors, commercial operations and analytics, finance, information technology and human resource functions.
Loss on extinguishment of term loan Loss on extinguishment of term loan consist of the loss from extinguishment of term loan due to repayment of the Oxford debt. Comprehensive Loss All components of comprehensive loss, including net loss, are reported in the consolidated financial statements in the period in which they are recognized.
Comprehensive loss All components of comprehensive loss, including net loss, are reported in the consolidated financial statements in the period in which they are recognized.
If we raise additional funds by issuing equity securities, our stockholders may experience dilution. See Part I, Item 1A (Risk Factors) of this report for additional risks associated with our substantial capital requirements.
See Part I, Item 1A (Risk Factors) of this report for additional risks associated with our substantial capital requirements.
We believe the number of LALs sold (reported as implanted in a patient) in each quarter is an important metric indicative of adoption and utilization of our RxSight system. 2023 2022 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 LALs Sold 10,523 12,622 13,657 18,071 4,166 5,400 6,595 9,123 During 2023, we had increased LDD sales of 71 and increased LAL sales of 29,589 when compared to 2022 from strong adoption of our RxSight technology by practices and doctors combined with an increased LDD installed base.
We also believe the number of LALs sold (reported as implanted in a patient) in each quarter is an important metric indicative of adoption and utilization of our RxSight system. 2024 2023 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 LDDs Sold 66 78 78 83 56 67 66 77 Installed Base at End of Period 732 810 888 971 456 523 589 666 2024 2023 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 LALs Sold 20,218 24,214 24,554 29,069 10,523 12,622 13,657 18,071 86 During 2024, we had increased LDD sales of 39 and increased LAL sales of 43,182 when compared to 2023 from strong adoption of our RxSight technology by practices and doctors combined with an increased LDD installed base.
Selling, general and administrative expenses Selling, general and administrative expenses increased by $16.1 million, or 27.5%, to $74.8 million for the year ended December 31, 2023, from $58.7 million for the year ended December 31, 2022.
Selling, general and administrative expenses Selling, general and administrative expenses increased by $26.6 million, or 35.6%, to $101.4 million for the year ended December 31, 2024, from $74.8 million for the year ended December 31, 2023.
Our gross margin could fluctuate from quarter to quarter as we introduce new products, and as we adopt new manufacturing processes and technologies. Our LDD, as is typical of many medical device capital equipment products, has a low gross margin, as the material cost of the LDD is significant, representing greater than 50% of the total cost to manufacture.
Our LDD, as is typical of many medical device capital equipment products, has a lower gross margin than the IOL, as the material cost of the LDD is significant, representing approximately 50% of the total cost to manufacture.
For the year ended December 31, 2023 and 2022, revenue from contracts with customers consisted of the following (in thousands): Year Ended December 31, 2023 2022 LDD (including training) $ 32,091 $ 22,515 LAL 54,092 24,965 Service warranty, service contracts, and accessories 2,894 1,525 $ 89,077 $ 49,005 For the year ended December 31, 2023 and 2022 we had no customers who individually accounted for more than 10% of revenue.
For the years ended December 31, 2024 and 2023, revenue from contracts with customers consisted of the following (in thousands): Year Ended December 31, 2024 2023 LDD (including training) $ 39,704 $ 32,091 LAL 96,497 54,092 Service warranty, service contracts, and accessories 3,726 2,894 $ 139,927 $ 89,077 For the year ended December 31, 2024 and 2023 we did not have any one customer who individually accounted for more than 10% of revenue.
Our RxSight system is approved in Mexico and Canada for improving uncorrected visual acuity by adjusting the LAL power to correct residual postoperative refractive error. We may selectively pursue commercial expansion in these or other geographies that accept these approvals in the future, with a priority on markets where we see significant potential future opportunities.
Our RxSight system has regulatory approval in the U.S., Europe, Canada, Mexico and Korea. We may selectively pursue commercial expansion in these or other geographies that accept these approvals in the future, with a priority on markets where we see significant potential opportunities.
Liquidity and capital resources Sources of liquidity We have incurred significant operating losses and negative cash flows from operations since our inception, and we anticipate that we will incur significant losses in the future. As of December 31, 2023, we had cash and cash equivalents of $9.7 million, short-term investments of $117.5 million, and accumulated deficit of $594.6 million.
Liquidity and capital resources Sources of liquidity We have incurred significant operating losses and negative cash flows from operations since our inception, and we anticipate that we will continue to incur losses in the near future.
Net cash provided by investing activities for the year ended December 31, 2022 was $40.0 million, consisting of net maturity of short-term investments of $42.3 million which was partially offset by purchases of property and equipment of $2.4 million.
Cash used in investing activities Net cash used in investing activities for the year ended December 31, 2024 was $99.3 million, consisting of net purchases of short-term investments of $93.9 million and purchases of property and equipment of $5.4 million.
We do not have long-term supply agreements with, or guaranteed commitments from our suppliers, including single and sole source suppliers. We utilize purchase orders or blanket orders covering the medium term of 18–24 months for the majority of our supplier base.
We utilize purchase orders or blanket orders covering the medium term of 18–24 months for the majority of our supplier base.
For the years ended December 31, 2023 and 2022, our net losses from operations were $50.1 and $63.3 million, respectively. We generated sales of $89.1 million and had a net loss of $48.6 million for the year ended December 31, 2023, compared to sales of $49.0 million and net loss of $66.8 million for the year ended December 31, 2022.
We generated sales of $139.9 million and had a net loss of $27.5 million for the year ended December 31, 2024, compared to sales of $89.1 million and net loss of $48.6 million for the year ended December 31, 2023.
At the time of filing the shelf registration statement, we also filed a prospectus supplement to sell up to an aggregate value of $50.0 million dollars of our common stock through an ATM offering, through BofA Securities, Inc. as sales agent (the “ATM Facility”).
The shelf registration statement is intended to provide us with the flexibility to access additional capital. At the time of filing the shelf registration statement, we also filed a prospectus supplement to sell up to an aggregate value of $115.0 million dollars of common stock through a public offering (“Public Offering”).
Cash provided by financing activities Net cash provided by financing activities for the year ended December 31, 2023 was $61.5 million, consisting primarily of proceeds from issuances of common stock from our public offering of $54.1 million, proceeds from issuance of common stock for at-the-market offerings of $42.4 million and proceeds from issuance of common stock of $9.5 million partially offset by a net paydown of the June 2023 LSA of $40.0 million.
Net cash provided by financing activities for the year ended December 31, 2023 was $61.5 million, consisting primarily of proceeds from issuances of common stock from our public offering of $54.1 million, proceeds from issuance of common stock for at-the-market offerings of $42.4 million and proceeds from issuance of common stock of $9.5 million pursuant to equity compensation programs, partially offset by a net paydown of the June 2023 LSA Oxford term debt of $40.0 million. 92 Critical accounting policies, significant judgments and use of estimates Our management’s discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).
Shelf Registration Statement On August 8, 2022, we filed a $200.0 million shelf registration statement which became effective on August 12, 2022. The shelf registration is effective for three years and permits us to sell, from time to time, up to $200.0 million in aggregate value of our common stock, preferred stock, debt securities, warrants, and/or units.
Recent Developments Shelf Registration Statement On May 8, 2024, we filed an automatic shelf registration statement on Form S-3 (“shelf registration statement”). The shelf registration statement is effective for three years and permits us to sell, from time to time, common stock, preferred stock, debt securities, warrants, and/or units.
In addition, we do not mark up our LDD substantially, as LDDs, as sold, generate LAL procedures. Our LAL gross margin is higher, with low material cost but high fixed overhead costs. As our manufacturing volume of the LAL increases, we expect the gross margin may improve significantly.
In addition, the list price for and average selling price of our LDD are priced reasonably because LDDs, once sold, generate LAL procedures. Our LAL gross margin is higher, with low material cost but high fixed overhead costs.
This increase was primarily attributable to $2.9 million in increased personnel costs which includes stock-based compensation and $0.4 million in increased clinical study costs. Other income (expense), net Other income (expense), net decreased by $4.9 million to income of $1.5 million for the year ended December 31, 2023 from expense of $3.4 million for the year ended December 31, 2022.
This increase was primarily attributable to $2.9 million in increased facility costs due to increased research and development infrastructure, $2.2 million in increased personnel costs which includes stock-based compensation and $0.4 million in increased clinical study costs.
Net cash provided by financing activities for the year ended December 31, 2022 was $6.3 million, consisting primarily of net proceeds from our at-the-market offering of $6.0 million and proceeds from stock options exercised and issuance of common stock under the employee stock purchase plan of $1.8 million which were partially offset by payments of employee taxes of $0.6 million and payments for offering costs of $0.6 million in connection with the filing of our shelf registration statement.
Cash provided by financing activities Net cash provided by financing activities for the year ended December 31, 2024 was $123.3 million, consisting primarily of proceeds from issuances of common stock from our public offering of $108.1. million, and proceeds from issuance of common stock pursuant to equity compensation programs of $20.8 million, partially offset by tax payments for employee stock compensation of $4.8 million.
We recognize LDD revenue primarily at the point in time at installation and customer acceptance of the LDD is satisfied. LALs are held at customer sites on consignment. Revenue is recognized for LALs upon customer notification that the LALs have been implanted in a patient. The timing of revenue recognition for LDD transactions and LAL transactions requires management judgment.
Revenue is recognized for LALs upon customer notification that the LALs have been implanted in a patient or when title transfers to the distributor in a limited number. The timing of revenue recognition for LDD transactions and LAL transactions requires management judgment. Revenue recognition is reasonably likely to have a material impact on our financial condition and results of operations.
General and administrative expenses increased by $3.7 million primarily due to an additional $2.5 million from increased personnel costs and increased stock-based compensation as well as $1.7 million of increased legal, audit and audit related costs related to operating as a public company. 89 Research and development expenses Research and development expenses increased by $3.1 million to $29.1 million for the year ended December 31, 2023 from $26.0 million for the year ended December 31, 2022, an increase of 11.4%.
Research and development expenses Research and development expenses increased by $5.3 million to $34.4 million for the year ended December 31, 2024 from $29.1 million for the year ended December 31, 2023, an increase of 18.3%.
Revenue recognition is reasonably likely to have a material impact on our financial condition and results of operations. Indemnification agreements We enter into standard indemnification arrangements in the ordinary course of business.
Indemnification agreements We enter into standard indemnification arrangements in the ordinary course of business.
The underwriters' option was exercised in full on February 10, 2023 and closed on February 14, 2023. We received net proceeds of approximately $53.6 million from the public offering, after deducting underwriters' discounts and commissions of $3.5 million and offering expenses of $0.5 million.
The underwriters' option was exercised in full on May 10, 2024 and the Public Offering (inclusive of the underwriters' option shares) closed on May 13, 2024.
Removed
Our fourth quarter of 2023 was consistent with the typical seasonality patterns for cataract surgery volumes, which tend to be stronger in the fourth quarter. 2023 2022 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 LDDs Sold 56 67 66 77 40 49 49 57 Installed Base at End of Period 456 523 589 666 246 294 * 343 400 * Reduced by one LDD taken out of installed base in Q2 2022.
Added
For example, it is not uncommon in our industry to experience seasonally weaker sales during the summer months and end-of-year holiday season. We may be affected by other seasonal trends in the future, including severe weather (which can impact the number of elective procedures performed), particularly as our business matures.
Removed
We expect SG&A expenses to continue to increase in absolute dollars as we expand our sales and marketing organization and 87 infrastructure to both drive and support the anticipated growth in revenue and due to additional legal, accounting audit and tax fees, insurance and other expenses associated with being a public company.
Added
Additionally, this seasonality may be reflected to a much lesser extent, and sometimes may not be immediately apparent, in our revenue. To the extent we experience this seasonality, it may cause fluctuations in our operating results and financial metrics and make forecasting our future operating results and financial metrics more difficult.
Removed
The shelf registration statement was intended to provide us with flexibility to access additional capital when market conditions are appropriate.
Added
Our gross margin could fluctuate from quarter to quarter as we introduce new products, and as we adopt new manufacturing processes and technologies.
Removed
As of the date of this report, a total of 2,617,964 shares of our common stock, for total gross proceeds of $50.0 million (net proceeds of $47.5 million), representing the full authorized amount under the ATM Facility, have been issued and sold.
Added
Loss on extinguishment of term loan Loss on extinguishment of term loan consist of the loss from extinguishment of term loans due to repayment to Oxford Finance, LLC (“Oxford”).
Removed
Refinancing and Payoff of Oxford Debt On October 29, 2020, we and Oxford Finance LLC (“Oxford”), as collateral agent, and certain lenders (“Lenders”) entered into that certain Loan and Security Agreement, as amended by that certain Consent and First Amendment to Loan and Security Agreement, dated as of July 6, 2021, and that certain Second Amendment to Loan and Security Agreement, dated as of May 3, 2022 (the “May 2022 LSA”), pursuant to which the Lenders provided to us certain loans in accordance with the terms and conditions of the May 2022 LSA (such loans collectively, the “May 2022 Term Loan”).
Added
For more information regarding our prior term debt arrangement with Oxford, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) – Liquidity and Capital Resources – Refinancing and Payoff of Oxford Debt” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on March 28, 2024 (the “2023 Form 10-K”), which is incorporated herein by reference.
Removed
The May 2022 LSA increased the loan and security agreement to $60.0 million, of which $40.0 million was fully drawn upon as of May 3, 2022 from the original term loan.
Added
General and administrative expenses increased by $7.2 million due to increased personnel expenses of $2.6 million, and increased stock-based compensation of $2.8 million and as well as $1.6 million of increased sales 89 tax, outside services, software licenses and bank fees due to an increase in our general administration infrastructure to support an increased installed base and revenues.
Removed
On June 30, 2023, we entered into a new Loan and Security Agreement (the “June 2023 LSA”) with Oxford as collateral agent and the lenders party thereto, pursuant to which we borrowed $20.0 million in aggregate Term A Loans (the “Term A Loans”).
Added
Other income (expense), net Other income (expense), net increased by $8.0 million to income of $9.5 million for the year ended December 31, 2024 from income of $1.5 million for the year ended December 31, 2023.
Removed
On that same date, we prepaid the May 2022 Term Loan in full which included approximately $1.2 million in final payment and other fees using a combination of cash, primarily comprised of $19.4 million of net cash raised under the ATM Facility during the quarter ended June 30, 2023, $20.0 million in Term A 90 Loans and $1.7 million in cash reserves.
Added
Comparison of the years ended December 31, 2023 and 2022 A discussion of changes in our results of operations during the year ended December 31, 2023 compared to the year ended December 31, 2022 has been omitted from this Annual Report on Form 10-K, but may be found in “MD&A – Results of Operations – Comparison of the years ended December 31, 2023 and 2022” in Part II, Item 7 of the 2023 Form 10-K, which discussion is incorporated herein by reference and which is available free of charge on the SEC’s website at www.sec.gov.
Removed
On August 4, 2023, we prepaid the Term A Loans in full, including accrued interest and fees, using $11.9 million of cash, net, raised under the ATM Facility and $9.3 million in cash reserves. The paydown in full of our debt is expected to reduce anticipated interest expense in 2024 by approximately $2.3 million.
Added
As of December 31, 2024, we had cash and cash equivalents of $16.7 million, short-term investments of $220.5 million, and accumulated deficit of $622.1 million. For the years ended December 31, 2024 and 2023, our net losses from operations were $36.9 and $50.1 million, respectively.
Removed
Moreover, in the event that we enter into collaborations or licensing arrangements to raise capital, we may be required to accept unfavorable terms.
Added
We received net proceeds of approximately $107.5 million from the Public Offering, after deducting underwriters' discounts and commissions of $6.9 million and other offering expenses of $0.6 million. 90 Contractual obligations and commitments November 2024 lease activity 100 Columbia lease to include 120 Columbia Suites 300, 400 and 500 On November 6, 2024, we entered into a new lease amendment to one of our existing leases comprising our headquarters, manufacturing, research and development and administrative offices in Aliso Viejo, California.
Removed
These agreements may require that we relinquish or license to a third party on unfavorable terms our rights to products or technologies we otherwise would seek to develop or commercialize ourselves, or reserve certain opportunities for future potential arrangements when we might be able to achieve more favorable terms.
Added
We entered into the new amended lease to have continued long-term access to our facilities and acquire additional square footage. April 2024 lease activity On April 18, 2024, we entered into a new lease, and amendments to two existing leases, for three of our four facilities comprising our headquarters, manufacturing, research and development and administrative offices in Aliso Viejo, California.
Removed
We may be unable to raise additional funds or to enter into such agreements or arrangements on favorable terms, or at all.
Added
We entered into the new lease and amended two existing leases to extend the rental terms and options, ensure continued long-term access to our facilities, acquire additional square footage to expand manufacturing, and align the lease end dates for each of our four facilities.
Removed
Our ability to raise additional funds may be adversely impacted by potential worsening global economic conditions and the recent disruptions to, and volatility in, the credit and financial markets in the United States and worldwide resulting from the conflicts in Eastern Europe, the Middle East and otherwise.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeInterest Fluctuation Rate Risk We had cash and cash equivalents and short-term investments of $127.2 million as of December 31, 2023, which consisted of $117.5 million in highly liquid money market and U.S. Treasury securities with maturities of twelve months or less. The primary goals of our investment policy are liquidity and capital preservation.
Biggest changeInterest Fluctuation Rate Risk We had cash and cash equivalents and short-term investments of $237.2 million as of December 31, 2024, which consisted of $220.5 million in highly liquid money market and U.S. Treasury securities with maturities of twelve months or less. The primary goals of our investment policy are liquidity and capital preservation.
If overall interest rates had increased or decreased by 1.00% (100 basis points), our interest income would not have been materially affected during the years ended December 31, 2023 or December 31, 2022.
If overall interest rates had increased or decreased by 1.00% (100 basis points), our interest income would not have been materially affected during the years ended December 31, 2024 or December 31, 2023.
A hypothetical 1.00% (100 basis points) increase in interest rates would not have materially impacted the fair value of our marketable securities as of December 31, 2023 and December 31, 2022.
A hypothetical 1.00% (100 basis points) increase in interest rates would not have materially impacted the fair value of our marketable securities as of December 31, 2024 and December 31, 2023.
Foreign Currency Exchange Risk As of December 31, 2023, we have de minimis amounts of revenue and expenses that are denominated in currencies other than U.S. dollars. 94
Foreign Currency Exchange Risk As of December 31, 2024, we have de minimis amounts of revenue and expenses that are denominated in currencies other than U.S. dollars. 94

Other RXST 10-K year-over-year comparisons