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What changed in Anika Therapeutics, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Anika Therapeutics, Inc.'s 2024 and 2025 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 2025 report.

+310 added−282 removedSource: 10-K (2026-03-03) vs 10-K (2025-03-17)

Top changes in Anika Therapeutics, Inc.'s 2025 10-K

310 paragraphs added · 282 removed · 212 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

61 edited+24 added−19 removed84 unchanged
Biggest changeWe are committed to bringing this revolutionary pain management therapy to the approximate $1 billion U.S. addressable market. For additional information, please see the section captioned “Item 1. Business—Research and Development.” ● Regenerative Solutions : Integrity, Hyalofast, and Tactoset. Integrity is an HA-based scaffold with bone and tendon fixation components and arthroscopic delivery instruments.
Biggest changeWe had another Type-C meeting with the FDA in February 2025 to discuss finalizing NDA submission requirements, including bioequivalence study requirements. The preclinical and bioequivalence studies have been initiated.. We are committed to bringing this revolutionary pain management therapy to the approximate $1 billion U.S. addressable market. For additional information, please see the section captioned “Item 1.
Regulation of a Drug New drugs require FDA approval of a NDA to be marketed. The approval process typically takes several years and varies based on the product’s type, complexity, and novelty. None of our products are currently approved under an NDA.
Regulation of a Drug New drugs require FDA approval of an NDA to be marketed. The approval process typically takes several years and varies based on the product’s type, complexity, and novelty. None of our products are currently approved under an NDA.
We anticipate continuing to commit resources to research and development activities, primarily for new product development, regulatory compliance, scale-up manufacturing activities, and preclinical and clinical activities. 9 Our new product development efforts focus on HA-based products in unmet, large, and growing orthopedic markets to drive long-term value, specifically in OA Pain Management and Regenerative Solutions.
We anticipate continuing to commit resources to research and development activities, primarily for new product development, regulatory compliance, scale-up manufacturing activities, and preclinical and clinical studies. 9 Our new product development efforts focus on HA-based products in unmet, large, and growing orthopedic markets to drive long-term value, specifically in OA Pain Management and Regenerative Solutions.
Additionally, many of our competitors compete with us for collaborations in research and development, clinical trial, and commercialization programs. 10 We primarily compete with other market participants on the efficacy and safety reputation of our products, as well as the breadth of our overall product portfolio.
Additionally, many of our competitors compete with us for collaborations in research and development, clinical trial, and commercialization programs. 10 We primarily compete with other market participants on the efficacy and safety of our products, as well as the breadth of our overall product portfolio.
After these dates, a UK Conformity Assessed (“UKCA”) mark will be required to place a device on the Great Britain market. Manufacturers may choose to use the UKCA mark voluntarily before these dates. However, the UKCA mark will not be recognized in the EU.
After these dates, a UK Conformity Assessed (“UKCA”) mark will be required to place a device on the Great Britain market. Manufacturers may choose to use the UKCA mark voluntarily before these dates. However, the UKCA mark is not recognized in the EU.
Cingal is our novel, next-generation, non-opioid, single-injection OA Pain Management product, consisting of our proprietary cross-linked HA material combined with a fast-acting steroid, designed to provide both short- and long-term pain relief. Cingal is CE marked and has been sold outside the United States for several years, directly in over 35 countries through our network of distributors.
Cingal is our novel, next-generation, non-opioid, single-injection OA Pain Management product, consisting of our proprietary cross-linked HA material combined with a fast-acting steroid, designed to provide both short- and long-term pain relief. Cingal is CE marked and has been sold outside the United States for several years, directly in over 50 countries through our network of distributors.
These legal requirements impose stringent requirements on the processing, administration, security, and confidentiality of personal data and empower enforcement agencies to impose large penalties for noncompliance. In addition, various jurisdictions around the world continue to propose new laws that regulate the privacy and/or security of certain types of personal data.
These laws and regulations impose stringent requirements on the processing, administration, security, and confidentiality of personal data and empower enforcement agencies to impose large penalties for noncompliance. In addition, various jurisdictions around the world continue to propose new laws that regulate the privacy and/or security of certain types of personal data.
Our development focus for OA Pain Management will continue to be on bringing Cingal, our next-generation, non-opioid, single-injection OA pain product combined with a fast-acting steroid, to the U.S. market. In 2022, we completed a third Phase III clinical trial for Cingal, which achieved its primary endpoint.
Our development focus for OA Pain Management will continue to be on targeting to bring Cingal, our next-generation, non-opioid, single-injection OA pain product combined with a fast-acting steroid, to the U.S. market. In 2022, we completed a third Phase III clinical trial for Cingal, which achieved its primary endpoint.
Governmental Regulation The clinical development, manufacturing, and marketing of our products are subject to governmental regulation in the United States, the European Union, and other territories worldwide, including under the Federal Food, Drug, and Cosmetic Act (“FDCA”) in the United States. Medical products regulated by the FDA and other authorities are generally classified as drugs, biologics, or medical devices.
Governmental Regulation The clinical development, manufacturing, and marketing of our products are subject to governmental regulation in the United States, the EU, and other territories worldwide, including under the Federal Food, Drug, and Cosmetic Act (“FDCA”) in the United States. Medical products regulated by the FDA and other authorities are generally classified as drugs, biologics, or medical devices.
Our OA Pain Management products are generally administered to patients in an office setting. In the United States, Monovisc and Orthovisc are marketed exclusively by J&J MedTech. In December 2011, we entered into a fifteen-year licensing agreement with J&J MedTech to exclusively market Monovisc in the United States through December 2026.
Our OA Pain Management products are generally administered to patients in an office setting. In the United States, Monovisc and Orthovisc are marketed exclusively by Johnson & Johnson MedTech (“J&J MedTech”). In December 2011, we entered into a fifteen-year licensing agreement with J&J MedTech to exclusively market Monovisc in the United States through December 2026.
We will place particular emphasis on the commercial execution and adoption of the newest product in our Regenerative Solutions portfolio, the Integrity Implant System (“Integrity”), a HA-based scaffold designed for rotator cuff and other tendon repairs. The Integrity system has shown strong performance, with over 40% sequential growth in surgeries and significant adoption by new customers.
We will place particular emphasis on the commercial execution and adoption of the newest product in our Regenerative Solutions portfolio, the Integrity Implant System (“Integrity”), a HA-based scaffold designed for rotator cuff and other tendon repairs. The Integrity system has shown strong performance, with continuing growth in surgeries and significant adoption by new customers.
As consideration for the Transaction, at closing, Medacta made a payment of $4.5 million in cash. Pursuant to the Parcus Purchase Agreement, the aggregate consideration is subject to customary post-closing adjustments. Products and Services Anika provides a broad array of products and services, including: ● Osteoarthritis ( “ OA ” ) Pain Management : Orthovisc, Monovisc, and Cingal.
As consideration for the Transaction, at closing, Medacta made a payment of $4.5 million in cash. Pursuant to the Parcus Purchase Agreement, the aggregate consideration is subject to customary post-closing adjustments. Products and Services We provide a broad array of products and services, including: ● Osteoarthritis ( “ OA ” ) Pain Management : Orthovisc, Monovisc, and Cingal.
Outside the United States, regulatory agencies may exert similar powers. EU Regulation In the European Union, medical devices must be CE marked to be marketed.
Outside the United States, regulatory agencies may exert similar powers. EU Regulation In the EU, medical devices must be CE marked to be marketed.
An advisory committee of external experts may review the application and provide recommendations to the FDA. The FDA generally conducts a pre-approval inspection of the manufacturing facilities to ensure compliance with the FDA’s quality system regulation (“QSR”).
An advisory committee of external experts may review the application and provide recommendations to the FDA. The FDA generally conducts a pre-approval inspection of the manufacturing facilities to ensure compliance with the FDA’s quality management system regulation (“QMSR”).
As a result of these distinctions, we employ multiple sales models in the United States to ensure that we meet the needs of our customers and other healthcare system stakeholders. For many years, we have maintained a mutually beneficial commercial partnership with J&J MedTech, which sells Monovisc and Orthovisc in the United States.
As a result of these distinctions, we employ multiple sales models in the United States to ensure that we meet the needs of our customers and other healthcare system stakeholders. For many years, we have maintained a mutually beneficial commercial partnership with J&J MedTech.
If these market makers demand significant price concessions or exclude us as a supplier, our product revenue could be adversely impacted. Despite these challenges, our products, like Monovisc, Orthovisc, and Cingal, have maintained strong market positions due to their clinical efficacy and safety profiles.
If these market makers demand significant price concessions or exclude us as a supplier, our product revenue could be adversely impacted. Despite these challenges, many of our products, such as Monovisc, Orthovisc, and Cingal, have maintained strong market positions due to their clinical efficacy and safety profiles.
In addition, we have made significant progress on a full regenerative pipeline, leveraging the commercial success of Integrity, as well as progress on our clinical trial to support approval in the United States for Hyalofast, our single-stage, off-the-shelf cartilage repair therapy, currently sold only outside the United States. We have fully enrolled the 200 patients targeted in the Hyalofast trial.
In addition, we have made significant progress on a full regenerative pipeline, leveraging the commercial success of Integrity, as well as progress on our clinical trial to support approval in the United States for Hyalofast, our single-stage, off-the-shelf cartilage repair therapy, currently sold only outside the United States.
The information on our website is not part of this Annual Report on Form 10-K. 17
The information on our website is not part of this Annual Report on Form 10-K. 16
These include enhancements to existing regenerative solutions such as our Tactoset Injectable Bone Substitute, which received an additional premarket notification (510(k)) clearance in 2021 for hardware augmentation, and our Integrity Implant System, a regenerative HA-based patch product targeted at rotator cuff repair that received 510(k) clearance in August 2023 and is now in full market release.
These include enhancements to existing regenerative solutions such as our Tactoset Injectable Bone Substitute for hardware augmentation, our Integrity Implant System, a regenerative HA-based patch product targeted at rotator cuff repair that received 510(k) clearance in August 2023 and is now in full market release.
As of December 31, 2024, we employed 288 full-time employees in the United States and Europe. 16 We believe that our employees’ understanding of how their work contributes to our overall strategy and performance is key to our success.
As of December 31, 2025, we employed 235 full-time employees in the United States and Europe. 15 We believe that our employees’ understanding of how their work contributes to our overall strategy and performance is key to our success.
Integrity has shown strong performance, with over 40% sequential growth in surgeries and significant adoption by new customers.
Integrity has shown strong performance, with strong growth in surgeries and significant adoption by new customers.
Rules and regulations regarding reimbursement change frequently, often on short notice. The U.S. government, state legislatures, and foreign governments continue to implement cost-containment programs, including price controls, coverage and reimbursement restrictions, and generic substitution requirements. Adoption of such measures could limit product sales.
The U.S. government, state legislatures, and foreign governments continue to implement cost-containment programs, including price controls, coverage and reimbursement restrictions, and generic substitution requirements. Adoption of such measures could limit product sales.
We will continue to invest in our Regenerative Solutions R&D pipeline as we prepare for the U.S. approval and launch of both Hyalofast and Cingal, each representing an incremental U.S. addressable market of at least $1 billion.
We will continue to invest in our Regenerative Solutions R&D pipeline as we prepare for the potential U.S. approval and launch of both Hyalofast and Cingal, each representing an incremental U.S. addressable market of at least $1 billion. We submitted our premarket approval (“PMA”) application with the FDA for Hyalofast on October 31, 2025.
All employees globally are eligible to participate in the annual incentive cash bonus plan or a sales incentive plan aligned with corporate and individual performance. Bonus opportunities and equity compensation increase as a percentage of total compensation based on responsibility level.
We also provide equity compensation for certain employees based on various criteria, including their level within the company. All employees globally are eligible to participate in the annual incentive cash bonus plan or a sales incentive plan aligned with corporate and individual performance. Bonus opportunities and equity compensation increase as a percentage of total compensation based on responsibility level.
Devices certified under the MDD may continue to be marketed during a transitional period. On March 15, 2023, the transition period was extended from May 26, 2024, to either May 26, 2026, December 31, 2027, or December 31, 2028, depending on device classification, provided certain conditions are met.
On March 15, 2023, the transition period was extended from May 26, 2024, to either May 26, 2026, December 31, 2027, or December 31, 2028, depending on device classification, provided certain conditions are met.
Therefore, we encourage investors, the media, and others interested in our company to review the information we post on the social media channels listed on our investor relations website.
It is possible that the information we post on social media could be deemed to be material information. Therefore, we encourage investors, the media, and others interested in our company to review the information we post on the social media channels listed on our investor relations website.
Although we have not received any material product liability claims to date, we cannot assure that if material claims arise in the future, our insurance will be adequate to cover all situations. Moreover, we cannot assure that such insurance, or additional insurance, if required, will be available in the future or, if available, will be available on commercially reasonable terms.
Although we have not received any material product liability claims to date, we cannot be sure that if material claims arise in the future, our insurance will be adequate to cover all situations.
CE marking involves working with a notified body (or self-certifying for low-risk devices) to demonstrate that the device meets all applicable general safety and performance requirements of EU medical devices legislation, including compliance with the manufacturer’s Quality Management System. The EU’s Medical Devices Directive (“MDD”) has been replaced by the EU Medical Devices Regulation (“EU MDR”), effective May 26, 2021.
CE marking involves working with a notified body (or self-certifying for certain low-risk, Class I devices) to demonstrate that the device meets all applicable general safety and performance requirements of EU medical devices legislation, including compliance with the manufacturer’s Quality Management System.
The FDA and other agencies actively enforce laws prohibiting off-label marketing and promotion. Companies found to have improperly marketed or promoted off-label uses may face significant liability, including criminal and civil penalties under the FDCA and False Claims Act, exclusion from federal healthcare programs, and mandatory compliance programs.
Companies found to have improperly marketed or promoted off-label uses may face significant liability, including criminal and civil penalties under the FDCA and False Claims Act, exclusion from federal healthcare programs, and mandatory compliance programs. The FDA may also require post-marketing testing and surveillance to monitor a marketed product's effects.
Drug approval in the European Union follows one of several processes: (i) a centralized procedure involving the European Medicines Agency’s Committee for Medicinal Products for Human Use; (ii) a mutual recognition procedure, where an individual country's regulatory agency approves the product, followed by mutual recognition by other countries' regulatory agencies; (iii) a decentralized procedure, where approval is sought simultaneously through multiple countries' regulatory agencies; or (iv) a national procedure, where approval is sought through a single country's regulatory agency. 13 UK Regulation The UK formally left the EU on January 31, 2020.
Drug approval in the EU follows one of several processes: (i) a centralized procedure, involving a scientific opinion from the European Medicines Agency’s Committee for Medicinal Products for Human Use (“CHMP”), with the marketing authorization granted by the European Commission; (ii) a mutual recognition procedure, where an individual country's regulatory agency approves the product, followed by mutual recognition by other countries' regulatory agencies; (iii) a decentralized procedure, where approval is sought simultaneously through multiple countries' regulatory agencies; or (iv) a national procedure, where approval is sought through a single country's regulatory agency. 13 UK Regulation As of January 1, 2021, the Medicines and Healthcare products Regulatory Agency (“MHRA”) is the UK’s standalone medicines and medical devices regulator.
Driven by strong partnerships with physicians, Anika is dedicated to pioneering HA-based innovations that redefine orthopedic care. Our mission is to restore active living, empower surgeon choice, and enhance patient outcomes worldwide. Anika ’ s Mission: “Powered by our passionate team, we partner with clinicians to create and provide meaningful advancements in early intervention orthopedic care.
Driven by strong partnerships with physicians, Anika is dedicated to pioneering HA-based innovations that redefine orthopedic care. Our mission is to restore active living, empower surgeon choice, and enhance patient outcomes worldwide.
The final module of the PMA will be filed in 2025 once the clinical data becomes available for submission to the FDA. Intellectual Property We pursue patent and trademark protection for our key technologies, products, and product enhancements in the United States and select international markets. When appropriate, we enforce and plan to defend our patent and trademark rights.
Intellectual Property We pursue patent and trademark protection for our key technologies, products, and product enhancements in the United States and select international markets. When appropriate, we enforce and plan to defend our patent and trademark rights.
Monovisc and Orthovisc have been market leaders, based on combined overall revenue in the viscosupplement market, since 2018. Despite recent competitive pricing pressures and reduced market access, Monovisc and Orthovisc remain market leaders in the U.S. OA Pain Management market.
These licensing agreements of Monovisc and Orthovisc can be extended at the option of J&J MedTech. Monovisc and Orthovisc have been market leaders, based on combined overall revenue in the viscosupplement market, since 2018. Despite recent competitive pricing pressures and reduced market access, Monovisc and Orthovisc remain market leaders in the United States OA Pain Management market.
The FDA may also require post-marketing testing and surveillance to monitor a marketed product's effects. Discovery of previously unknown problems or non-compliance with FDA requirements can lead to adverse publicity, product restrictions, and judicial or administrative enforcement.
Discovery of previously unknown problems or non-compliance with FDA requirements can lead to adverse publicity, product restrictions, and judicial or administrative enforcement.
The cost of ongoing compliance with such environmental regulations does not have a material effect on our operations. 15 Seasonality Our OA Pain Management and Non-Orthopedic product families are generally less seasonal in nature due to the nature of our product mix and sales channels and order strategies of our customers.
Seasonality Our OA Pain Management and Non-Orthopedic product families are generally less seasonal in nature due to the nature of our product mix and sales channels and order strategies of our customers.
To communicate these important topics engagingly, we utilize various channels, including all-employee town hall meetings led by senior management, company-wide information sessions known as Knowledge Boosters, and regular email and intranet updates from our CEO and other key executives.
To communicate these important topics engagingly, we utilize various channels, including all-employee town hall meetings led by senior management through regular email and intranet updates from our CEO and other key executives. We also monitor voluntary turnover as compared to national and industry benchmarks and evaluate improvement opportunities through exit and stay interviews.
While Tactoset and Integrity are commercialized principally in the United States, Hyalofast is currently available outside the United States in over 30 countries within Europe, South America, Asia, and certain other international markets. In the United States, Hyalofast is a pipeline product under a pivotal Investigational Device Exemption (“IDE”) clinical trial and is not available for commercial sale.
Hyalofast is a 100% HA resorbable scaffold used for single stage cartilage regeneration. While Tactoset and Integrity are commercialized principally in the United States, Hyalofast is currently available outside the United States in over 30 countries within Europe, South America, Asia, and certain other international markets.
Diversity, Equity and Inclusion We are committed to a diverse, equitable, and inclusive workplace where all employees, regardless of gender, race, ethnicity, national origin, age, sexual orientation or identity, education, or disability, are valued, respected, and supported. Beginning in 2021, we committed to key elements of the MassBio CEO Pledge for a More Equitable and Inclusive Life Science Industry.
Diversity, Equity and Inclusion We are committed to a diverse, equitable, and inclusive workplace where all employees, regardless of gender, race, ethnicity, national origin, age, sexual orientation or identity, education, or disability, are valued, respected, and supported. We will continue to enhance workforce diversity through focused talent acquisition goals and development plans.
FDA regulations mandate that PMA and NDA approved products be manufactured in specific facilities, and all devices and drugs must comply with the QSR and cGMP regulations, respectively.
FDA regulations mandate that PMA and NDA approved products be manufactured in specific facilities, and all devices and drugs must comply with the QMSR and cGMP regulations, respectively. Manufacturers and other entities involved in the manufacture and distribution of cleared or approved devices or drugs must register their establishments and list their products with the FDA and certain state agencies.
Additionally, in September 2024, we acquired the Aristospan NDA, which allowed us to address a recent FDA requirement and will enable us to source the reference drug for a bioequivalence study. We had another Type-C meeting with the FDA in February 2025 to discuss finalizing NDA submission requirements.
Additionally, in September 2024, we acquired the Aristospan New Drug Application (“NDA”), which allowed us to address a recent FDA requirement and will enable us to source the reference drug for a bioequivalence study. In April 2025, we subsequently sold the Aristospan NDA to a third party manufacturer who will supply the reference drug for the bioequivalence study.
Since its launch, Integrity has shown strong performance, with over 40% sequential growth in surgeries and significant adoption by new customers. The system competes in a U.S. tendon augmentation market estimated to be more than $220 million annually. Hyalofast is a 100% HA resorbable scaffold used for single stage cartilage regeneration.
Integrity received FDA clearance for commercial use in the United States in August 2023 and we initiated a limited market release in November 2023. Since its launch, Integrity has shown strong performance, with continuing growth in surgeries and significant adoption by new customers. The system competes in a U.S. tendon augmentation market estimated to be more than $220 million annually.
In December 2003, we entered into a ten-year licensing agreement to exclusively market Orthovisc in the United States. J&J MedTech extended this agreement for additional five-year terms in 2007, 2012, 2017, and most recently in August 2022. The current agreement expires in December 2028 unless extended at the option of J&J MedTech.
On October 16, 2025, J&J MedTech extended the agreement to exclusively market Monovisc in the United States through December 2031. In December 2003, we entered into a ten-year licensing agreement to exclusively market Orthovisc in the United States. J&J MedTech has subsequently extended this agreement, and most recently from August 2022 through December 2028.
We have established safety policies and protocols and regularly update employees on any changes. We have adjusted attendance policies to encourage those who may be ill to stay home. To further protect on-site employees, we provide personal protective equipment and cleaning supplies.
We have established safety policies and protocols and regularly update employees on any changes. To further protect on-site employees, we invest resources for environmental, health and safety, conduct regular safety training for our employees and provide personal protective equipment and cleaning supplies.
We have been actively engaging with the FDA on next steps for U.S. regulatory approval. In September 2024, we acquired the Aristospan NDA to assist with our Cingal regulatory filing with the FDA.
Cingal has shown significant clinical success and we have been actively engaging with the FDA on next steps for regulatory approval in the U.S.
We will continue to assess and update our ESG initiatives as our business grows and as we implement processes and improvements over time. Human Capital Management We believe that creating a diverse, talented, and inclusive workplace is central to our culture, employee recruitment, retention, engagement, innovation, operational excellence, and overall performance.
Human Capital Management We believe that creating a diverse, talented, and inclusive workplace is central to our culture, employee recruitment, retention, engagement, innovation, operational excellence, and overall performance. This culture and drive for performance are crucial in attracting and retaining key talent.
Competitive Pay and Benefits To attract and retain qualified employees and key talent, we offer total rewards packages consisting of base salary, cash bonuses, and comprehensive benefits. We also provide equity compensation for certain employees based on various criteria, including their level within the company.
We also provide financial support, including tuition reimbursement for qualified programs, and access to a broad-based learning management platform for self-directed learning and improvement. Competitive Pay and Benefits To attract and retain qualified employees and key talent, we offer total rewards packages consisting of base salary, cash bonuses, and comprehensive benefits.
Data Privacy and Security Laws We are also subject to various laws and regulations concerning data privacy in the United States, Europe, and elsewhere, including the General Data Protection Regulation (“GDPR”), in the European Union and the United Kingdom.
Data Privacy and Security Laws We are also subject to various laws and regulations concerning data privacy in the United States, Europe, and elsewhere, including Section 5(a) of the Federal Trade Commission Act, U.S. state consumer privacy laws, state breach notification laws, rules restricting the transfer of sensitive personal data, and comprehensive privacy and data protection laws, in the EU and the United Kingdom, including the General Data Protection Regulation (“GDPR”).
In this arrangement, we sell the Monovisc and Orthovisc products that we manufacture to J&J MedTech, and we also receive a royalty from J&J MedTech on their end-user sales of these products in the United States. We have U.S. commercial partnerships for other products in our Non-Orthopedic product families.
Pursuant to our contracts with J&J MedTech, we are the exclusive supplier responsible for the manufacture and sale Monovisc and Orthovisc to J&J MedTech in the United States, while J&J MedTech is responsible for the marketing, sales and distribution to end user customers in the United States. We have U.S. commercial partnerships for other products in our Non-Orthopedic product families.
For 2024, 2023, and 2022, research and development expenses were $25.6 million, $21.8 million, and $18.3 million, respectively. The increase in 2024 was primarily due to costs associated with ensuring compliance with growing global regulatory requirements, such as the European Union (“EU”) Medical Device Regulation (“MDR”), as well as new product development in our research and development pipeline.
The increase in 2025 was primarily due to costs associated with increased spending on Cingal U.S. regulatory submission activities and our Integrity clinical study, as well as ensuring compliance with growing global regulatory requirements, such as the European Union (“EU”) Medical Device Regulation (“MDR”) and new product development initiatives.
Discovery of violative conditions, including failure to conform to QSR and cGMP regulations, could result in enforcement actions. Products may only be promoted for the cleared or approved indications and in accordance with the label provisions. While the FDA does not regulate physicians' treatment choices, it restricts communications about off-label use of products.
These manufacturers are subject to periodic announced and unannounced inspections by the FDA and state agencies to ensure compliance with regulatory requirements. Discovery of violative conditions, including failure to conform to QMSR and cGMP regulations, could result in enforcement actions. Products may only be promoted for the cleared or approved indications and in accordance with the label provisions.
We use these channels as well as social media, including LinkedIn and Twitter (@AnikaThera), to communicate with the public about our company, our business, our product candidates and other matters. It is possible that the information we post on social media could be deemed to be material information.
Investors and others should note that we announce material information to our investors using our investor relations website (https://ir.anika.com/), SEC filings, press releases, public conference calls and webcasts. We use these channels as well as social media, including LinkedIn and Twitter (@AnikaThera), to communicate with the public about our company, our business, our product candidates and other matters.
Any product liability claim, if successful, could have a material adverse effect on our business, financial condition, and results of operations. Available Information We are required to file annual, quarterly, and current reports, proxy statements, and other information with the SEC.
Moreover, we cannot be sure that such insurance, or additional insurance, if required, will be available in the future or, if available, will be available on commercially reasonable terms. Any product liability claim, if successful, could have a material adverse effect on our business, financial condition, and results of operations.
We have made significant progress in addressing the FDA's requirements for Cingal's approval, including a Type-C meeting with the FDA and acquiring the Aristospan NDA to enable us to source the reference drug for a bioequivalence study. We had another Type-C meeting with the FDA in February 2025 to discuss finalizing NDA submission requirements.
We have been actively engaging with the FDA on next steps for U.S. regulatory approval. We have made significant progress in addressing the FDA's requirements for Cingal's approval. This includes having numerous meetings with the FDA to discuss finalizing NDA submission requirements and starting a bioequivalence study in 2025.
The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. Investors and others should note that we announce material information to our investors using our investor relations website (https://ir.anika.com/), SEC filings, press releases, public conference calls and webcasts.
Available Information We are required to file annual, quarterly, and current reports, proxy statements, and other information with the SEC. The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.
Hyalofast is on track for a U.S. launch by 2026, and we have submitted the first two modules of our premarket approval (“PMA”) application with the FDA. Additionally, we will build on the international commercial momentum of our entire OA Pain Management portfolio, led by Monovisc and Cingal.
We received a letter from the FDA in January 2026 in which the FDA identified a number of deficiencies in which we are preparing our response. Additionally, we will build on the international commercial momentum of our entire OA Pain Management portfolio, led by Monovisc and Cingal.
We have also conducted employee surveys and focus groups to discuss diversity and inclusion. We will continue to enhance workforce diversity through focused talent acquisition goals and development plans. Employee Development The ongoing development of our employees is a catalyst for our growth and success. Many of our employees have advanced degrees in their professions.
Employee Development The ongoing development of our employees is a catalyst for our growth and success. Many of our employees have advanced degrees in their professions. We support further development with individualized development plans, mentoring, coaching, group training, and conference attendance.
The EU regulatory framework for medical devices continues to apply in Northern Ireland under the Northern Ireland Protocol. Medical devices in Northern Ireland may carry either an EU CE mark or a UK and Northern Ireland CE mark (“CE UKNI”), although devices bearing the CE UKNI marking will not be accepted on the EU market.
The EU regulatory framework for medical devices continues to apply in Northern Ireland under the Northern Ireland Protocol.
It is impossible to determine how future healthcare reform measures or efforts to challenge, repeal, or replace the ACA will impact our business.
It is impossible to determine how future healthcare reform measures, including changes affecting Medicare reimbursement, utilization management, site-of-care policies, or drug pricing and payment methodologies, will impact our business.
Complying with these laws, if enacted, would require significant resources and leave us vulnerable to possible fines, penalties, litigation, and reputational harm if we are unable to comply. Environmental Laws We believe that we are in compliance with all foreign, federal, state, and local environmental regulations with respect to our manufacturing facilities.
Environmental Laws We believe that we are in compliance with all foreign, federal, state, and local environmental regulations with respect to our manufacturing facilities. The cost of ongoing compliance with such environmental regulations does not have a material effect on our operations.
We have filed the first and second modules of its PMA with the FDA, and the product is on track for a U.S. launch by 2026. For additional information, please see the section captioned “Item 1.
In the United States, Hyalofast is a pipeline product under a pivotal Investigational Device Exemption (“IDE”) clinical trial and is not available for commercial sale. We submitted a PMA on October 31, 2025 with the FDA, and we are targeting a U.S. launch by 2027, pending approval from the FDA. For additional information, please see the section captioned “Item 1.
As a result of the materiality assessment, we identified the themes that are most important to our stakeholders and our business within traditional environmental, social and governance pillars. Most immediately, our materiality assessment enabled us to select our six key focus areas, with a goal to be aligned with SASB standards for the medical device industry.
This process identified the ESG topics most significant to our business and led to the selection of six initial focus areas aligned with SASB standards for the medical device industry. We plan to review and update our ESG efforts as needed over time.
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We are unwavering in our commitment to quality and compliance as we develop and commercialize solutions that restore active living for people around the world.” Anika ’ s Core Values: ● People: We engage with and invest in each other in a community that values diversity and inclusion. ● Quality: We strive for the highest quality and compliance in everything we do. ● Integrity: We live up to our promises and do the right thing, every day. ● Innovation: We are agile and entrepreneurial in developing and delivering meaningful solutions. ● Teamwork: We operate with mutual respect and trust and are collaborative as we grow together. ● Accountability: We are empowered and accountable to deliver results and value to all our stakeholders.
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Anika ’ s Mission: “Together, we restore active living and redefine what’s possible with hyaluronic acid.” Anika ’ s Core Values: ● Trust and Respect: We build trust and show respect in every interaction. ● Quality: We are committed to quality as we work to improve people’s lives. ● Empowerment & Teamwork: We are empowered as a team to make decisions that drive impact. ● Focus: We focus on what matters most and are driven to be better every day.
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Cingal has shown significant clinical success and is progressing towards a New Drug Application (“NDA”) filing in the U.S.
Added
Business—Research and Development.” ● Regenerative Solutions : Integrity, Hyalofast, and Tactoset. Integrity is an HA-based scaffold with bone and tendon fixation components and arthroscopic delivery instruments. It is designed to protect injured tendons and promote healing in rotator cuff repair and other tendon procedures.
Removed
It is designed to protect injured tendons and promote healing in rotator cuff repair and other tendon procedures. Integrity received FDA clearance for commercial use in the United States in August 2023 and we initiated a limited market release in November 2023.
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For 2025, 2024, and 2023, research and development expenses were $25.8 million, $25.5 million, and $21.8 million, respectively.
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This pipeline is led by Integrity, which received FDA clearance in August 2023 and was launched with first surgeries in rotator cuff repair and other tendon procedures in November 2023.
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In early 2023, we completed enrollment of 200 patients in our U.S. pivotal FastTRACK Phase III clinical trial evaluating Hyalofast, a single-stage, hyaluronic acid-based scaffold for cartilage repair. This clinical trial had a two-year follow-up protocol. We used a modular PMA filing process for our regulatory submission to the FDA for approval of Hyalofast in the U.S.
Removed
This pivotal trial has a two-year follow-up protocol expected to be completed in early 2025 before regulatory submission is finalized. We filed the first module as part of a modular PMA in 2024, which is the first step in seeking FDA approval for Hyalofast in the United States, and the second module was filed in January 2025.
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In July 2025, we received topline results from the study and Hyalofast did not achieve significance on its pre-specified co-primary endpoints for pain and function.
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On February 2, 2024, the FDA published a final rule to amend its QSR requirements to align more closely with international consensus standards for medical devices by incorporating the 2016 edition of the ISO 13485 standard. This amended regulation, known as the Quality Management System Regulation, will be effective February 2, 2026.
Added
Although the study did not meet its co-primary endpoints, Hyalofast demonstrated consistent improvements over microfracture across all measures of pain and function, Sports and Recreation Function and Quality of Life and other measures including Total Knee Injury and Osteoarthritis and Outcomes Score.
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Manufacturers and other entities involved in the manufacture and distribution of cleared or approved devices or drugs must register their establishments and list their products with the FDA and certain state agencies. These manufacturers are subject to periodic announced and unannounced inspections by the FDA and state agencies to ensure compliance with regulatory requirements.
Added
The statistical analysis was impacted by both a disproportionately higher subject dropout rate in the microfracture arm and missed visits due to COVID.
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The EU also removed its 12-month "sell-off" provision, allowing non-transitioning medical devices that comply with the MDD to be supplied in the EU after May 2025 until stock is depleted.
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Based on the strength and consistency of the overall data and the positive real-world clinical experience including data from multiple independent studies outside the U.S. over the past 15 years, we submitted the final PMA module to the FDA on October 31, 2025.
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The EU and the UK concluded a Trade and Cooperation Agreement (“TCA”), provisionally applicable since January 1, 2021, and formally applicable since May 1, 2021. The TCA includes specific provisions concerning pharmaceuticals, such as the mutual recognition of GMP inspections and GMP documents but does not provide for wholesale mutual recognition of UK and EU pharmaceutical regulations.
Added
As expected, we received in January 2026 a deficiency letter from the FDA informing us that the Hyalofast PMA lacks information needed to complete its review. Among other things, the letter addressed matters related to chemistry, manufacturing and controls (CMC) and the statistical analysis plan for both primary and secondary endpoints and whether any of these endpoints achieved statistical significance.
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Currently, the UK has implemented EU legislation on the marketing, promotion, and sale of medicinal products through the Human Medicines Regulations 2012 (as amended), with the Medicines and Healthcare products Regulatory Agency (“MHRA”) responsible for authorizing all medicinal products.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

78 edited+47 added−22 removed201 unchanged
Biggest changeThe authorities have shown a willingness to impose significant fines and issue orders preventing the processing of personal data on non-compliant businesses. Data subjects also have a private right of action, as do consumer associations, to lodge complaints with supervisory authorities, seek judicial remedies, and obtain compensation for damages resulting from violations of applicable data protection laws.
Biggest changeThe GDPR also confers a private right of action on data subjects and consumer associations to lodge complaints with supervisory authorities, seek judicial remedies, and obtain compensation for damages resulting from violations of the GDPR. 20 In the United States, numerous federal and state laws and regulations, including health information privacy laws, state data breach notification laws, and federal and state consumer protection laws that govern the collection, use, disclosure and protection of health-related and other personal information could apply to our operations or the operations of our collaborators and third-party service providers.
We may not be able to anticipate all types of security threats, nor may we be able to implement preventive measures effective against all such security threats.
We may not be able to anticipate all types of security threats, nor may we be able to implement preventive measures to be effective against all such security threats.
Additional clearance or approval of existing products may be required when changes to such products may affect the safety and effectiveness, including for new indications for use, labeling changes, process or manufacturing changes, the use of a different facility to manufacture, process or package the product, and changes in performance or design specifications.
Additional clearance or approval of existing products may be required when changes to such products may affect safety and effectiveness, including for new indications for use, labeling changes, process or manufacturing changes, the use of a different facility to manufacture, process or package the product, and changes in performance or design specifications.
We secured certification extensions for several products in accordance with EU MDR transitional guidance. We have achieved MDR certification for Monovisc and Hyalofast, and have other products’ submissions either under review, or planned to meet updated certification deadlines.
We secured certification extensions for several products in accordance with EU MDR transitional guidance. We have achieved EU MDR certification for Monovisc and Hyalofast, and have other products’ submissions either under review, or planned to meet updated certification deadlines.
These risks include: ● The impact of recessions, inflation and other economic conditions in economies outside the United States; ● Instability of foreign economic, political, and labor conditions; ● Fluctuations in foreign currency exchange rates relative to the U.S. dollar; ● Unfavorable labor regulations applicable to our European operations, such as severance and the unenforceability of non-competition agreements in the European Union; ● The impact of strikes, work stoppages, work slowdowns, grievances, complaints, claims of unfair labor practices, or other collective bargaining disputes; ● Difficulties in complying with restrictions imposed by regulatory or market requirements, tariffs, or other trade barriers or by U.S. export laws; ● Imposition of government controls limiting the volume of international sales; ● Longer accounts receivable payment cycles; ● Potentially adverse tax consequences, including, if required or applicable, difficulties transferring funds generated in non-U.S. jurisdictions to the United States in a tax efficient manner; ● Difficulties in protecting intellectual property, especially in international jurisdictions; ● Difficulties in managing international operations; and ● Burdens of complying with a wide variety of foreign laws, including the EU MDR and GDPR among others.
These risks include: ● The impact of recessions, inflation and other economic conditions in economies outside the United States; ● Instability of foreign economic, political, and labor conditions; ● Fluctuations in foreign currency exchange rates relative to the U.S. dollar; ● Unfavorable labor regulations applicable to our European operations, such as severance and the unenforceability of non-competition agreements in the EU; ● The impact of strikes, work stoppages, work slowdowns, grievances, complaints, claims of unfair labor practices, or other collective bargaining disputes; ● Difficulties in complying with restrictions imposed by regulatory or market requirements, tariffs, or other trade barriers or by U.S. export laws; ● Imposition of government controls limiting the volume of international sales; ● Longer accounts receivable payment cycles; ● Potentially adverse tax consequences, including, if required or applicable, difficulties transferring funds generated in non-U.S. jurisdictions to the United States in a tax efficient manner; ● Difficulties in protecting intellectual property, especially in international jurisdictions; ● Difficulties in managing international operations; and ● Burdens of complying with a wide variety of foreign laws, including the EU MDR and GDPR among others.
A significant portion of our OA Pain Management revenues are derived from a small number of customers, the loss of which could materially adversely affect our business, financial condition and results of operations. We have historically derived most of our revenues from a small number of customers who resell our products to end-users.
A significant portion of our OA Pain Management revenues are derived from a small number of customers, the loss of which could materially adversely affect our business, financial condition and results of operations. We have historically derived most of our revenue from a small number of customers who resell our products to end-users.
We expect that market demand, government regulation, third-party reimbursement policies, and societal pressures will continue to change the worldwide healthcare industry, which may exert further downward pressure on the prices of our products and limit our access to sell our products and services to customers.
We expect that market demand, government regulation, third-party reimbursement policies, and societal pressure will continue to change the worldwide healthcare industry, which may exert further downward pressure on the prices of our products and limit our access to sell our products and services to customers.
If such an event were to occur, it could result in the theft or destruction of intellectual property, data or other misappropriation of assets, or otherwise compromise our confidential or proprietary information and result in a material disruption of our development programs and our business operations. 23 Although we devote resources to protect our information systems, we realize that cyberattacks, cyber intrusions and other disruptions are a threat, and there can be no assurance that our efforts will prevent information security incidents or breaches that would result in business, legal, financial or reputational harm to us, or would have a material adverse effect on our business, financial condition, results of operations and prospects.
If such an event were to occur, it could result in the theft or destruction of intellectual property, data or other misappropriation of assets, or otherwise compromise our confidential or proprietary information and result in a material disruption of our development programs and our business operations. 22 Although we devote resources to protect our information systems, we realize that cyberattacks, cyber intrusions and other disruptions are a threat, and there can be no assurance that our efforts will prevent information security incidents or breaches that would result in business, legal, financial or reputational harm to us, or would have a material adverse effect on our business, financial condition, results of operations and prospects.
Any data security incident or breach in our or our third-party providers’ information technology systems could lead to the unauthorized access, disclosure and use of non-public information, including protected health information and other personally identifiable information which is protected by HIPAA, and other laws.
Any data security incident or breach in our or our third-party providers’ information technology systems could lead to unauthorized access, disclosure and use of non-public information, including protected health information and other personally identifiable information which is protected by HIPAA, and other laws.
Lack of adequate coverage and reimbursement provided by governments and other third-party payers for our products and services, including continuing coverage for Monovisc and Orthovisc in the United States, and any change of classification by the Centers for Medicare and Medicaid Services for reimbursement of Orthovisc and Monovisc, could have a material adverse effect on our business, financial condition, and results of operations. 28 Risks Related to Our Product Development and Regulatory Compliance We are facing a longer than expected pathway to commercialize our Cingal product in the United States, and we may face other unforeseen difficulties in achieving regulatory approval for Cingal and Hyalofast, which could affect our business and financial results.
Lack of adequate coverage and reimbursement provided by governments and other third-party payers for our products and services, including continuing coverage for Monovisc and Orthovisc in the United States, and any change of classification by the Centers for Medicare and Medicaid Services for reimbursement of Orthovisc and Monovisc, could have a material adverse effect on our business, financial condition, and results of operations. 27 Risks Related to Our Product Development and Regulatory Compliance We are facing a longer than expected pathway to commercialize our Cingal product in the United States, and we may face other unforeseen difficulties in achieving regulatory approval for Cingal and Hyalofast, which could affect our business and financial results.
The FDA and foreign regulatory bodies impose extensive regulations applicable to our operations and products, including regulations governing product and sterilization standards, packaging requirements, labeling requirements, adverse event reporting, quality system and manufacturing requirements, import restrictions, tariff regulations, duties, and tax requirements.
The FDA and foreign regulatory bodies impose extensive regulations applicable to our operations and products, including regulations governing product and sterilization standards, packaging requirements, labeling requirements, adverse event reporting, quality management system and manufacturing requirements, import restrictions, tariff regulations, duties, and tax requirements.
This includes the European Union (“EU”), GDPR, and the United Kingdom (“UK”) equivalent of the same (the “UK GDPR” together with the EU GDPR, the “GDPR”), as well as other national data protection legislation in force in relevant European Economic Area (“EEA”) Member States and the UK (including the UK Data Protection Act 2018), which governs the collection, use, storage, disclosure, transfer, or other processing of personal data (including health data processed in the context of clinical trials): (i) regarding individuals in the EEA and UK; and/or (ii) carried out in the context of the activities of our establishment in any EEA Member State or the UK.
This includes the EU, GDPR, and the United Kingdom (“UK”) equivalent of the same (the “UK GDPR” together with the EU GDPR, the “GDPR”), as well as other national data protection legislation in force in relevant European Economic Area (“EEA”) Member States and the UK (including the UK Data Protection Act 2018), which governs the collection, use, storage, disclosure, transfer, or other processing of personal data (including health data processed in the context of clinical trials): (i) regarding individuals in the EEA and UK; and/or (ii) carried out in the context of the activities of our establishment in any EEA Member State or the UK.
Those provisions could have the effect of discouraging a third party from pursuing a non-negotiated takeover of our company at a price considered attractive by many stockholders and could have the effect of preventing or delaying a potential acquirer from acquiring control of our company. 34 If securities or industry analysts do not publish or cease publishing research or reports about us, our business, or our market, or if they adversely change their recommendations regarding our stock, our stock price and trading volume could decline.
Those provisions could have the effect of discouraging a third party from pursuing a non-negotiated takeover of our company at a price considered attractive by many stockholders and could have the effect of preventing or delaying a potential acquirer from acquiring control of our company. 33 If securities or industry analysts do not publish or cease publishing research or reports about us, our business, or our market, or if they adversely change their recommendations regarding our stock, our stock price and trading volume could decline.
There can be no assurance that we will be able to compete against current or future competitors or that competition will not have a material adverse effect on our business, financial condition, and results of operations. 18 Our business may be adversely affected if consolidation in the healthcare industry leads to demand for price concessions or if we are excluded from being a supplier by a group purchasing organization or similar entity.
There can be no assurance that we will be able to compete against current or future competitors or that competition will not have a material adverse effect on our business, financial condition, and results of operations. 17 Our business may be adversely affected if consolidation in the healthcare industry leads to demand for price concessions or if we are excluded from being a supplier by a group purchasing organization or similar entity.
Compliance with this and any other requirements is time consuming and costly, and our failure to comply may subject us to significant liabilities, which could have a material adverse effect on our business, financial condition, and results of operations. 30 Notices of inspectional observations or deficiencies from the FDA or other regulatory bodies require us to undertake corrective and preventive actions or other actions to address the FDA ’ s or other regulatory bodies' concerns.
Compliance with this and any other requirements is time-consuming and costly, and our failure to comply may subject us to significant liabilities, which could have a material adverse effect on our business, financial condition, and results of operations. 29 Notices of inspectional observations or deficiencies from the FDA or other regulatory bodies require us to undertake corrective and preventive actions or other actions to address the FDA ’ s or other regulatory bodies' concerns.
A failure to maintain relationships with our commercial partners on terms satisfactory to us, or at all, could result in a material adverse effect on our operating results. 27 We continue to seek to establish long-term partnerships in regions and countries not covered by existing agreements, and we may need to obtain the assistance of additional marketing partners to bring new and existing products to market and to replace certain marketing partners.
A failure to maintain relationships with our commercial partners on terms satisfactory to us, or at all, could result in a material adverse effect on our operating results. 26 We continue to seek to establish long-term partnerships in regions and countries not covered by existing agreements, and we may need to obtain the assistance of additional marketing partners to bring new and existing products to market and to replace certain marketing partners.
In addition, cyberattacks, cyber intrusions, or other interruptions may cause stakeholders (including investors and potential customers) to stop supporting our business, deter new customers from using our products, and negatively impact our ability to grow and operate our business. 24 We may face circumstances in the future that will result in impairment charges, including, but not limited to, goodwill impairment, intangible assets impairment and in-process research and development charges.
In addition, cyberattacks, cyber intrusions, or other interruptions may cause stakeholders (including investors and potential customers) to stop supporting our business, deter new customers from using our products, and negatively impact our ability to grow and operate our business. 23 We may face circumstances in the future that will result in impairment charges, including, but not limited to, goodwill impairment, intangible assets impairment and in-process research and development charges.
Any of these factors could significantly impact our competitive position in relation to such products and could have a negative impact on the sales of such products. 29 Once obtained, we cannot guarantee that the FDA or international product clearances or approvals will not be withdrawn or that relevant agencies will not require other corrective action, and any withdrawal or corrective action could materially affect our business and financial results.
Any of these factors could significantly impact our competitive position in relation to such products and could have a negative impact on the sales of such products. 28 Once obtained, we cannot guarantee that the FDA or international product clearances or approvals will not be withdrawn or that relevant agencies will not require other corrective action, and any withdrawal or corrective action could materially affect our business and financial results.
We may not be able to find sufficient alternative suppliers in a reasonable time period, or on commercially reasonable terms, if at all, and our ability to produce and supply our products could be impaired. 19 Our manufacturing processes involve inherent risks, and disruption could materially adversely affect our business, financial condition, and results of operations.
We may not be able to find sufficient alternative suppliers in a reasonable time period, or on commercially reasonable terms, if at all, and our ability to produce and supply our products could be impaired. 18 Our manufacturing processes involve inherent risks, and disruption could materially adversely affect our business, financial condition, and results of operations.
We are required to apply GDPR standards to any clinical trials that our EEA and UK established businesses carry out anywhere in the world. 20 Significantly, the GDPR imposes strict rules on the transfer of personal data out of the EEA or the UK to the United States or other regions that have not been deemed to offer “adequate” privacy protections.
We are required to apply GDPR standards to any clinical trials that our EEA and UK established businesses carry out anywhere in the world. 19 Significantly, the GDPR imposes strict rules on the transfer of personal data out of the EEA or the UK to the United States or other regions that have not been deemed to offer “adequate” privacy protections.
If the fair value of any of our long-lived assets decrease as a result of an economic slowdown, a downturn in the markets where we sell products and services, a downturn in our stock price, financial performance or future outlook, or other reasons, we may be required to record an impairment charge on such assets.
If the fair value of any of our long-lived assets decreases as a result of an economic slowdown, a downturn in the markets where we sell products and services, a downturn in our stock price, financial performance or future outlook, or other reasons, we may be required to record an impairment charge on such assets.
No assurance can be given that any additional financing will be made available to us or will be available on acceptable terms should such a need arise. 25 If we succeed in raising additional funds through the issuance of equity or convertible securities, then the issuance could result in substantial dilution to existing stockholders.
No assurance can be given that any additional financing will be made available to us or will be available on acceptable terms should such a need arise. 24 If we succeed in raising additional funds through the issuance of equity or convertible securities, then the issuance could result in substantial dilution to existing stockholders.
The process of complying with these governmental regulations can be costly and time consuming, and could delay or prevent the production, manufacturing or sale of our products. We could become subject to product liability claims, which, if successful, could materially adversely affect our business, financial condition, and results of operations.
The process of complying with these government regulations can be costly and time-consuming, and could delay or prevent the production, manufacturing or sale of our products. We could become subject to product liability claims, which, if successful, could materially adversely affect our business, financial condition, and results of operations.
Although we believe that alternative sources for many of these and other components and raw materials that we use in our manufacturing processes are available, we cannot be certain that the supply of key raw materials will continue to be available at current levels or will be sufficient to meet our future needs.
Although we believe that alternative sources for many of the components and raw materials that we use in our manufacturing processes are available, we cannot be certain that the supply of key raw materials will continue to be available at current levels or will be sufficient to meet our future needs.
As a result, we have had and will have less control over the conduct of the clinical trials, the timing and completion of the trials, the required reporting of adverse events, and the management of data developed through the trials than would be the case if we were relying entirely on our own staff.
As a result, we have had and will have less control over the conduct of the clinical trials, the timing and completion of the trials, the required reporting of adverse events, and the management of data developed through the trials that would be the case if we were relying entirely on our own staff.
The GDPR also provide individuals with various rights in respect of their personal data. The definition of personal data under GDPR is defined broadly and includes pseudonymized or coded data; GDPR will, therefore, apply in the context of data collected and processed about clinical trial participants and investigators in the EU and UK.
The GDPR also provides individuals with various rights in respect of their personal data. The definition of personal data under GDPR is defined broadly and includes pseudonymized or coded data; GDPR will, therefore, apply in the context of data collected and processed about clinical trial participants and investigators in the EU and UK.
To the extent funds generated from our operations, together with our existing capital resources, are insufficient to meet future requirements, we will be required to obtain additional funds through equity or debt financings, through strategic alliances with corporate partners and others, or through other sources.
To the extent funds generated from our operations, together with our existing capital resources, are insufficient to meet future requirements, we will be required to obtain additional funds through equity or debt financing, through strategic alliances with corporate partners and others, or through other sources.
The protections afforded by patents will depend upon their scope and validity, and others may be able to design around our patents. 33 We also rely upon trade secrets and proprietary know-how for certain non-patented aspects of our technology.
The protections afforded by patents will depend upon their scope and validity, and others may be able to design around our patents. 32 We also rely upon trade secrets and proprietary know-how for certain non-patented aspects of our technology.
Whether or not completed, transactions may result in diversion of management resources otherwise available for ongoing development of our business and significant expenditures. 32 Customer and employee uncertainty about the effects of any acquisitions or divestitures could harm us.
Whether or not completed, transactions may result in diversion of management resources otherwise available for ongoing development of our business and significant expenditures. 31 Customer and employee uncertainty about the effects of any acquisitions or divestitures could harm us.
Any compromise to our information security or that of our third-party service providers or contractors could result in an interruption in our operations, the unauthorized publication of our confidential business or proprietary information, the unauthorized release, use, disclosure and/or dissemination of customer, vendor, or employee data, the violation of privacy and/or data protection laws, including under the GDPR, in the European Union or the UK, or other laws and exposure to litigation, any of which could harm our business and operating results.
Any compromise to our information security or that of our third-party service providers or contractors could result in an interruption in our operations, the unauthorized publication of our confidential business or proprietary information, the unauthorized release, use, disclosure and/or dissemination of customer, vendor, or employee data, the violation of privacy and/or data protection laws, including under the GDPR, in the EU or the UK, or other laws and exposure to litigation, any of which could harm our business and operating results.
Despite our internal investment in staffing, we will remain dependent upon these third-party contract research organizations and consultants to carry out portions of our clinical and preclinical research studies and regulatory filing assistance for the foreseeable future.
Despite our internal investment in staffing, we will remain dependent upon these third-party contract research organizations and consultants to carry out portions of our clinical and pre-clinical research studies and regulatory filing assistance for the foreseeable future.
Any failure to comply with these laws could subject us to significant liabilities, which could have a material adverse effect on our business, financial condition, and results of operations. 31 We are subject to environmental regulations and any failure to comply with applicable laws could subject us to significant liabilities and harm our business.
Any failure to comply with these laws could subject us to significant liabilities, which could have a material adverse effect on our business, financial condition, and results of operations. 30 We are subject to environmental regulations and any failure to comply with applicable laws could subject us to significant liabilities and harm our business.
As a result of technology initiatives, recently enacted regulations, changes in our system platforms and integration of new business acquisitions, we have been consolidating and integrating the number of systems we operate and have upgraded and expanded our information systems capabilities.
As a result of technological initiatives, recently enacted regulations, changes in our system platforms and integration of new business acquisitions, we have been consolidating and integrating the number of systems we operate and have upgraded and expanded our information systems capabilities.
Beginning in 2019, we started selling and marketing many of our products directly to customers, including hospitals and ASCs, through our direct Anika sales team and large network of independent third-party distributors.
Beginning in 2019, we started selling and marketing many of our products directly to customers, including hospitals and ASCs, through our direct Anika sales team and a network of independent third-party distributors.
The rapid evolution of artificial intelligence will require the application of significant resources to design, develop, test and maintain our products and services to help ensure that artificial intelligence is implemented in accordance with applicable law and regulation and in a socially responsible manner and to minimize any real or perceived unintended harmful impacts.
The rapid evolution of AI will require the application of significant resources to design, develop, test and maintain our products and services to help ensure that AI is implemented in accordance with applicable law and regulation and in a socially responsible manner and to minimize any real or perceived unintended harmful impacts.
If we receive a notice of inspectional observations or deficiencies from the FDA or other regulatory bodies following an inspection, we may be required to undertake corrective and protective actions or other actions in order to address the FDA or other regulatory bodies concerns which could be expensive and time-consuming to complete and could impose additional burdens and expenses.
If we receive notice of inspectional observations or deficiencies from the FDA or other regulatory bodies following an inspection, we may be required to undertake corrective and protective actions or other actions to address the FDA or other regulatory bodies concerns which could be expensive and time-consuming to complete and could impose additional burdens and expenses.
Although we assess our banking and customer relationships as we believe necessary or appropriate, our access to funding sources and other credit arrangements in amounts adequate to finance or capitalize our current and projected future business operations could be significantly impaired by factors that affect the Company, the financial institutions with which the Company has credit agreements or arrangements directly, or the financial services industry or economy in general.
Although we assess our banking and customer relationships as we believe necessary or appropriate, our access to funding sources and other credit arrangements in amounts adequate to finance or capitalize our current and projected future business operations could be significantly impaired by factors that affect us, the financial institutions with which we have credit agreements or arrangements directly, or the financial services industry or economy in general.
There may be increased risk with the divestitures of these businesses due to diversion of the attention of management created by the divestiture process, disruptions or other difficulties encountered in the divestiture process, and unforeseen liabilities or unanticipated problems with the businesses being sold, which could have a material adverse effect on our business, operating results and financial condition.
While the divestitures are substantially complete, there may be increased risk with the divestitures of these businesses due to diversion of the attention of management created by the divestiture process, disruptions or other difficulties encountered in the divestiture process, and unforeseen liabilities or unanticipated problems with the businesses being sold, which could have a material adverse effect on our business, operating results and financial condition.
Our vendors may in turn incorporate artificial intelligence tools into their offerings, and the providers of these artificial intelligence tools may not meet existing or rapidly evolving regulatory or industry standards, including with respect to privacy and data security.
Our vendors may in turn incorporate AI tools into their offerings, and the providers of these AI tools may not meet existing or rapidly evolving regulatory or industry standards, including with respect to privacy and data security.
We may require additional capital in the future. We cannot give any assurance that such capital will be available at all or on terms acceptable to us, and if it is available, additional capital raised by us could dilute your ownership interest or the value of your shares.
We cannot give any assurance that such capital will be available at all or on terms acceptable to us, and if it is available, additional capital raised by us could dilute your ownership interest or the value of your shares.
Further, bad actors around the world use increasingly sophisticated methods, including the use of artificial intelligence, to engage in illegal activities involving the theft and misuse of personal information, confidential information and intellectual property.
Further, bad actors around the world use increasingly sophisticated methods, including the use of AI, to engage in illegal activities involving theft and misuse of personal information, confidential information and intellectual property.
During 2024, 2023, and 2022, 31%, 28%, and 26%, respectively, of our product sales were to international customers. We continue to be subject to a variety of risks, which could cause fluctuations in the results of our international and domestic operations.
During 2025, 2024, and 2023, 38%, 31%, and 28%, respectively, of our product sales were to international customers. We continue to be subject to a variety of risks, which could cause fluctuations in the results of our international and domestic operations.
Until we know what policy changes are made, whether those policy changes are challenged and subsequently upheld by the court system and how those changes impact our business and the business of our competitors over the long term, we will not know if, overall, we will benefit from them or be negatively affected by them.
Until we know what policy changes are made, whether those policy changes are challenged and subsequently upheld by the court system, the duration that those policy changes remain in effect, and how those changes impact our business and the business of our competitors over the long term, we will not know if, overall, we will benefit from them or be negatively affected by them.
As we expand the scale of our business activities, any changes in the United States and non-U.S. taxation of such activities may impact our effective tax rate, result in higher tax payments and harm our business, financial condition, cash flows and results of operations.
As we expand the scale of our business activities, any changes in the United States and non-U.S. taxation of such activities may impact our effective tax rate, result in higher tax payments and harm our business, financial condition, cash flows and results of operations. Substantial changes to U.S. tax law may adversely affect our business.
Any of these effects could damage our reputation, result in the loss of valuable property and information, cause us to breach applicable laws and regulations, and adversely impact our business.
Any of these effects could damage our reputation, result in the loss of valuable property and information, cause us to breach applicable laws and regulations, and adversely impact our business, financial condition and results of operation.
Changes to U.S. policy implemented by the U.S. Congress, the Trump administration or any new administration have impacted and may in the future impact, among other things, the U.S. and global economy, international trade relations, unemployment, immigration, healthcare, taxation, the U.S. regulatory environment, inflation and other areas.
Congress, the current administration or any new administration have impacted and may in the future impact, among other things, the U.S. and global economy, international trade relations, unemployment, immigration, healthcare, taxation, the U.S. regulatory environment, inflation and other areas.
Many of these customers are significantly larger companies than us. In 2024, J&J MedTech accounted for 57% of our revenue.
Many of these customers are significantly larger companies than us. In 2025, J&J MedTech accounted for 50% of our revenue.
On June 4, 2021, the European Commission issued new forms of SCCs for data transfers from controllers or processors in the EEA (or otherwise subject to the EU GDPR) to controllers or processors established outside the EEA (and not subject to the EU GDPR). The new SCCs replace the SCCs that were adopted previously under the Data Protection Directive.
On June 4, 2021, the European Commission issued new forms of SCCs for data transfers from controllers or processors in the EEA (or otherwise subject to the EU GDPR) to controllers or processors established outside the EEA (and not subject to the EU GDPR).
The existence of comprehensive privacy laws in different states in the country would make our compliance obligations more complex and costly and may increase the likelihood that we may be subject to enforcement actions or otherwise incur liability for noncompliance.
The existence of comprehensive privacy laws in different states in the country, which vary in their requirements and enforcement, may make our compliance obligations more complex and costly and may increase the likelihood that we become subject to litigation, enforcement actions or otherwise incur liability actual or perceived for noncompliance.
Such risks include, but are not limited to, adverse effects on macroeconomic conditions, including inflation; disruptions to our global technology infrastructure, including through cyberattack, ransom attack, or cyber-intrusion; adverse changes in international trade policies and relations; disruptions in global supply chains; and constraints, volatility, or disruption in the capital markets, any of which could negatively affect our business and financial condition. 26 The U.S.
Such risks include, but are not limited to, adverse effects on macroeconomic conditions, including inflation; disruptions to our global technology infrastructure, including through cyberattack, ransom attack, or cyber-intrusion; adverse changes in international trade policies and relations; disruptions in global supply chains; and constraints, volatility, or disruption in the capital markets, any of which could negatively affect our business and financial condition. 25 Significant political, trade, regulatory developments, and other circumstances beyond our control, could have a material adverse effect on our financial condition or results of operations.
For example, the EU’s Artificial Intelligence Act (“AI Act”) — the world’s first comprehensive AI law — which has entered into force on August 1, 2024 and most provisions of which will become effective on August 2, 2026.
For example, the EU’s Artificial Intelligence Act (“AI Act”) — the world’s first comprehensive AI law —entered into force on August 1, 2024, with most important provisions scheduled to become effective on August 1, 2026.
After discussions with the FDA, it was determined that an additional Phase III clinical trial would most likely be necessary to support U.S. marketing approval for Cingal.
After discussions with the FDA, it was determined that an additional Phase III clinical trial would most likely be necessary to support U.S. marketing approval for Cingal. In 2022, we completed this third Phase III clinical trial, which achieved its primary endpoint.
Connecticut and Nevada have also passed similar laws regulating consumer health data. In addition, a small number of states have also passed laws that regulate biometric data specifically. These various privacy and security laws may impact our business activities, including our identification of research subjects, relationships with business partners and ultimately the marketing and distribution of our products.
In addition, a smaller number of states have passed laws that regulate biometric data specifically. The increasingly complex landscape of privacy and security laws may impact our business activities, including our identification of research subjects, relationships with business partners and ultimately the marketing and distribution of our products.
Any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business.
Any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses, divert our management’s attention from the operation of our business, and lead to reputational damage and loss of current and future business, any of which may have a material adverse effect on our business.
We could be required to incur substantial costs to investigate, audit, and monitor compliance or to alter our practices, to the extent that we are subject to government scrutiny under these laws.
Even arrangements intended to facilitate product access, reimbursement, or patient affordability may be subject to regulatory interpretation or enforcement. We could be required to incur substantial costs to investigate, audit, and monitor compliance or to alter our practices, to the extent that we are subject to government scrutiny under these laws.
Together with previous clinical studies, Cingal has demonstrated superiority over each of its active ingredients and placebo over 26 weeks for long-acting pain relief. We have been engaging with the FDA on next steps for U.S. regulatory approval. We acquired the Aristospan NDA s in September 2024 to assist with our Cingal regulatory filing with the FDA.
Together with previous clinical studies, Cingal has demonstrated superiority over each of its active ingredients and placebo over 26 weeks for long-acting pain relief. We have been engaging with the FDA on next steps for U.S. regulatory approval. In parallel, we are exploring the potential to advance Cingal through commercial partnerships in the U.S. and select Asian markets.
The impact of the Russian invasion of Ukraine and the conflict in the Middle East on the global economy, energy supplies and raw materials is uncertain, but may prove to negatively impact our business and operations. The short and long-term implications of Russia’s invasion of Ukraine and the conflict in the Middle East are difficult to predict at this time.
The impact of the ongoing conflict between Russia and Ukraine and the conflict in the Middle East on the global economy, energy supplies and raw materials is uncertain, but may prove to negatively impact our business and operations.
We expect to continue to actively explore inorganic growth as a part of our future growth strategy, which exposes us to a variety of risks that could adversely affect our business operations.
The acquisition of these two companies and the related investment in the business have significantly contributed to our net losses in recent years. We expect to continue to actively explore inorganic growth as a part of our future growth strategy, which exposes us to a variety of risks that could adversely affect our business operations.
The trading market for our common stock is influenced by the research and reports that securities or industry analysts may publish about us, our business, our market, or our competitors.
The trading market for our common stock is influenced by research and reports that securities or industry analysts may publish about us, our business, our market, or our competitors. No person is under any obligation to publish research or reports on us, and any person publishing research or reports on us may discontinue doing so at any time without notice.
Claims that we have violated individuals’ privacy rights, failed to comply with data protection laws or breached our contractual obligations, even if we are not found liable, could be expensive and time-consuming to defend, could result in adverse publicity and could have a material adverse effect on our business, financial condition, results of operations and prospects.
Claims that we have violated individuals’ privacy rights, failed to comply with data protection laws or breached our contractual obligations, even if we are not found liable, could be expensive and time-consuming to defend, could result in adverse publicity and could have a material adverse effect on our business, financial condition, results of operations and prospects. 21 The use of new and evolving technologies, such as artificial intelligence, in our business may result in spending material resources and presents risks and challenges that can impact our business including by posing security and other risks to our confidential and/or proprietary information, including personal information, and as a result we may be exposed to reputational harm and liability.
If we develop or use AI systems that are governed by the AI Act, it may necessitate ensuring higher standards of data quality, transparency, and human oversight, as well as adhering to specific and potentially burdensome and costly ethical, accountability, and administrative requirements.
If we develop or use AI systems that are governed by these laws or regulations, including as informed by regulatory guidance, we will need to meet higher standards of data quality, transparency, and human oversight, and we would need to adhere to specific, potentially burdensome and costly ethical, accountability, and administrative requirements.
We face significant competition for such personnel from competitive companies, research and academic institutions, government entities, and other organizations. There can be no assurance that we will be successful in hiring or retaining the personnel we require. The failure to hire and retain such personnel could have a material adverse effect on our business, financial condition, and results of operations.
We continue to engage with our employees on a regular basis to limit voluntary employee turnover. We face significant competition for such personnel from competitive companies, research and academic institutions, government entities, and other organizations. There can be no assurance that we will be successful in hiring or retaining the personnel we require.
In parallel, we are exploring the potential to advance Cingal through commercial partnerships in the U.S. and select Asian markets. Other unforeseen future developments could have a substantial negative impact on the timeline for and the cost associated with a potential Cingal regulatory approval, our overall business condition, financial results, and competitive position could be affected.
Other unforeseen future developments could have a substantial negative impact on the timeline for and the cost associated with a potential Cingal regulatory approval, our overall business condition, financial results, and competitive position could be affected. We may experience difficulties or delays in securing regulatory approval for Hyalofast, which could negatively affect our business and financial results.
The lack of clarity on future UK laws and regulations and their interaction with EU laws and regulations could add legal risk, uncertainty, complexity and compliance cost to the handling of European personal data and our privacy and data security compliance and could require us to amend our processes and procedures to implement different compliance measures for the UK and the EEA. 21 In the United States, numerous federal and state laws and regulations, including federal health information privacy laws, state data breach notification laws, state health information privacy laws and federal and state consumer protection laws that govern the collection, use, disclosure and protection of health-related and other personal information could apply to our operations or the operations of our collaborators and third-party providers.
The lack of clarity on future UK laws and regulations and their interaction with EU laws and regulations could add legal risk, uncertainty, complexity and compliance cost to the handling of European personal data and our privacy and data security compliance and could require us to amend our processes and procedures to implement different compliance measures for the UK and the EEA.
The use of certain artificial intelligence technology can give rise to intellectual property risks, including compromises to proprietary intellectual property and intellectual property infringement. Additionally, we expect to see increasing government and supranational regulation related to artificial intelligence use and ethics, which may also significantly increase the burden and cost of research, development and compliance in this area.
We expect to see increasing regulation related to AI governance, use and ethics, which may also significantly increase the burden and cost of research, development and compliance in this area.
For example, California enacted the California Consumer Privacy Act (“CCPA”). This law, which became effective on January 1, 2020 gives California residents expanded rights to access and delete their personal information, opt out of certain personal information sharing and receive detailed information about how their personal information is used.
For example, the California Consumer Privacy Act (“CCPA”), grants California consumers (as defined in the law) individual privacy rights, including the rights to access, correct and delete their personal information, opt out of certain personal information sharing and receive detailed notice about how their personal information is used or shared.
The shifting compliance environment and the need to build and maintain robust and expandable systems to comply with multiple jurisdictions with different compliance and/or reporting requirements increases the possibility that a healthcare company may run afoul of one or more of the requirements. 22 Compliance with data protection laws and regulations could require us to take on more onerous obligations in our contracts, restrict our ability to collect, use and disclose data, or in some cases, impact our ability to operate in certain jurisdictions.
Compliance with data protection laws and regulations could require us to take on more onerous obligations in our contracts, restrict our ability to collect, use and disclose data, or in some cases, impact our ability to operate in certain jurisdictions.
In addition to these comprehensive laws and proposals, several other states have passed or proposed more limited privacy laws focused on particular privacy issues. For example, Washington’s My Health My Data Act, which became effective on March 31, 2024, regulates the collection and sharing of health information and has a private right of action, further increasing relevant compliance risk.
In addition to these comprehensive state privacy laws, other states, including Washington, Connecticut and Nevada, have passed laws that apply more stringent standards to consumer health information. Most notably, Washington’s My Health My Data Act regulates the collection and sharing of consumer health information and has a private right of action, further increasing relevant compliance risk.
As the healthcare industry consolidates, competition to provide products and services to industry participants has become and may continue to become more intense. This may result in greater pricing pressures and the exclusion of certain suppliers from important markets as group purchasing organizations, independent delivery networks, and large single accounts continue to use their market power to consolidate purchasing decisions.
This may result in greater pricing pressures and the exclusion of certain suppliers from important markets such as group purchasing organizations, independent delivery networks, and large single accounts continuing to use their market power to consolidate purchasing decisions. If a group purchasing organization excludes us from being one of their suppliers, our net sales could be adversely impacted.
In addition, the California Privacy Rights Act (“CPRA”) which became effective on January 1, 2023, imposes additional obligations on companies covered by the legislation and significantly modifies the CCPA, including by expanding consumers’ rights with respect to certain sensitive personal information. The CPRA also created a new state agency that was vested with authority to implement and enforce the CCPA.
In addition, the California Privacy Rights Act (“CPRA”) significantly modified the CCPA, including by expanding consumers’ rights with respect to certain sensitive personal information and created a state agency vested with authority to enforce the CCPA. The CCPA also provides for a private right of action for certain data breaches.
The effects of the CCPA are potentially significant and, should we begin to process personal information concerning California residents may require us to modify our data collection or processing practices and policies and to incur substantial costs and expenses in an effort to comply and increase our potential exposure to regulatory enforcement and/or litigation.
The effects of the CCPA are potentially significant and may require us to modify our data collection or processing practices and policies and to incur substantial costs and expenses in an effort to comply. The CCPA marked the beginning of a trend toward more stringent privacy legislation at the state level.
We believe that our future success will depend in large part upon our ability to attract and retain technical and highly skilled executive, managerial, professional, and technical personnel. We continue to engage with our employees on a regular basis to limit voluntary employee turnover.
This transition in our CEO role may disrupt our operations, create uncertainty among employees and investors, and result in changes to our strategic direction. We believe that our future success will depend in large part upon our ability to attract and retain technical and highly skilled executive, managerial, professional, and technical personnel.
In the EEA and the UK, data protection authorities may impose large penalties for violations of the data protection laws, including potential fines of up to €20 million (£17.5 million in the UK) or 4% of annual global revenue, whichever is greater.
Failure to comply with the requirements of the GDPR and the related national data protection laws of the EEA Member States and the UK may result in fines up to €20 million (£17.5 million for the UK GDPR) or 4% of a company’s global annual revenues for the preceding financial year, whichever is higher.
This legislation imposes significant obligations on providers and deployers of high-risk artificial intelligence systems and encourages providers and deployers of artificial intelligence systems to account for EU ethical principles in their development and use of these systems.
As currently enacted, the AI Act imposes significant obligations on providers and deployers of high-risk AI systems and general purpose AI models, and encourages providers and deployers of AI systems to account for EU ethical principles when developing and using AI technology.
If we are found to have promoted such “off-label” uses, we may become subject to significant government fines and other related liability. The federal government has levied large civil and criminal fines against companies for alleged improper promotion and has enjoined several companies from engaging in off-label promotion.
If we are found to have promoted such “off label” uses, we may become subject to significant government fines and other related liability. In the current administration, the FDA has increased its enforcement scrutiny over prescription drug advertising, particularly direct-to-consumer product promotion and advertising.
We may use and integrate artificial intelligence into our business processes, and this innovation presents risks and challenges that could affect its adoption, and therefore our business. If we enable or offer solutions that draw controversy due to perceived or actual negative societal impact, we may experience brand or reputational harm, competitive harm or legal liability.
We may use and integrate artificial intelligence (“AI”) into our business processes, and this innovation presents risks and challenges that could affect its adoption, and therefore our business. The use of AI presents risks and challenges that could adversely affect our business and reputation, including cybersecurity, data privacy, IT, confidentiality, regulatory, legal, operational, competitive, reputational, intellectual property and other risks.
The sales, marketing and pricing of products and the relationships that medical products companies have with healthcare providers such as physicians, hospitals, ASCs, and others are under increased scrutiny.
We are subject to various healthcare laws and regulations, and any failure to comply with applicable laws could subject us to significant liability and harm our business. The sales, marketing, pricing, and reimbursement practices of medical product companies, and their relationships with healthcare providers such as physicians, hospitals, ASCs, and others, are subject to extensive regulation and enforcement scrutiny.
The FDA has also requested that companies enter into consent decrees or permanent injunctions under which specified promotional conduct is changed or curtailed. We are subject to various healthcare laws and regulations, and any failure to comply with applicable laws could subject us to significant liability and harm our business.
The federal government has levied large civil and criminal fines against companies for alleged improper promotion and has enjoined several companies from engaging in off-label promotion. The FDA has also requested that companies enter into consent decrees or permanent injunctions under which specified promotional conduct is changed or curtailed.
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If a group purchasing organization excludes us from being one of their suppliers, our net sales could be adversely impacted.
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As the healthcare industry consolidates, competition to provide products and services to industry participants has become and may continue to become more intense.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeRisks from cybersecurity threats have, to date, not materially affected, and we do not believe they are reasonably likely to materially affect, us, our business strategy, results of operations or financial condition; however, from time to time, we have experienced threats and security incidents relating to our and our third party vendors’ information systems.
Biggest changeRisks from cybersecurity threats have, to date, not materially affected, and we do not believe they are reasonably likely to materially affect, us, our business strategy, results of operations or financial condition; however, from time to time, we have experienced threats and security incidents relating to our internal and our third-party vendors’ information systems.
We have implemented and maintain various information security processes designed to identify, assess and manage material risks from cybersecurity threats to critical computer networks, third party hosted services, communications systems, hardware, manufacturing equipment and processes, lab equipment, software, and our critical data including confidential, personal, proprietary, financial and sensitive data.
We have implemented and maintained various information security processes designed to identify, assess and manage material risks from cybersecurity threats to critical computer networks, third party hosted services, communications systems, hardware, manufacturing equipment and processes, lab equipment, software, and our critical data including confidential, personal, proprietary, financial and sensitive data.
To manage cybersecurity incidents, our global security operations team maintains a cybersecurity incident response plan, conducts readiness exercises, and takes steps to improve the program, as appropriate, to manage the changing threats faced in our industry. 35 As part of our cybersecurity risk management program, we take a risk-based approach to the evaluation of third -party vendors.
To manage cybersecurity incidents, our global security operations team maintains a cybersecurity incident response plan, conducts readiness exercises, and takes steps to improve the program, as appropriately, to manage the changing threats faced in our industry. 34 As part of our cybersecurity risk management program, we take a risk-based approach to the evaluation of third -party vendors.
Our VP of IT presents on risks from cybersecurity threats to the Audit Committee at least annually and to the full Board, as necessary.
Our VP of IT reviews the risks from cybersecurity threats to the Audit Committee at least annually and to the full Board, as necessary.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeOur other lease locations are in Warsaw, Indiana and Padova, Italy. These additional facilities provide us with an aggregate of over 80,000 square feet of additional space and have terms expiring between 2025 and 2032, subject to certain renewal provisions contained within the lease agreements.
Biggest changeOur other lease locations are in Warsaw, Indiana and Padova, Italy. These additional facilities provide us with an aggregate of over 64,000 square feet of additional space and have terms expiring between 2026 and 2032, subject to certain renewal provisions contained within the lease agreements.
ITEM 2. PROPERTIES We maintain leases on six facilities, including our corporate headquarters location in Bedford, Massachusetts, where we lease approximately 134,000 square feet of administrative, research and development, and manufacturing space. The lease on this facility contains multiple extension options that allow us to extend the term through October 2038.
ITEM 2. PROPERTIES We maintain leases on three facilities, including our corporate headquarters location in Bedford, Massachusetts, where we lease approximately 134,000 square feet of administrative, research and development, and manufacturing space. The lease on this facility contains multiple extension options that allow us to extend the term through October 2038.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS We are involved from time-to-time in various legal proceedings arising in the normal course of business. Although the outcomes of these legal proceedings are inherently difficult to predict, we do not expect the resolution of these proceedings to have a material adverse effect on our financial position, results of operations, or cash flows. ITEM 4.
Biggest changeITEM 3. LEGAL PROCEEDINGS We are involved from time to time in various legal proceedings arising in the normal course of business. Although the outcomes of these legal proceedings are inherently difficult to predict, we do not expect the resolution of these proceedings to have a material adverse effect on our financial position, results of operations, or cash flows.
MINE SAFETY DISCLOSURES Not applicable. 36 PART II
ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 35 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeDec-19 Dec-20 Dec-21 Dec-22 Dec-23 Dec-24 Anika Therapeutics, Inc. $ 100.00 $ 87.29 $ 69.10 $ 57.09 $ 43.70 $ 31.75 NASDAQ Composite Index $ 100.00 $ 143.64 $ 174.36 $ 116.65 $ 167.30 $ 215.22 NASDAQ Biotechnology Index $ 100.00 $ 125.69 $ 124.89 $ 111.27 $ 115.42 $ 113.84 37 Issuer Purchases of Equity Securities The following is a summary of stock repurchases for the three-month period ended December 31, 2024 (in thousands, except share and per share data): Period (a) Total number of shares purchased (1) (b) Average Price per Share (c) Total number of shares purchased as part of publicly announced plans or programs (d) Maximum number (or approximate dollar value) of shares that may yet be purchased under the plans or programs October 1 to 31, 2024 60,571 $ 24.37 60,571 $ 33,186 November 1 to 30, 2024 116,635 $ 17.14 116,635 $ 31,189 December 1 to 31, 2024 123,293 $ 17.03 123,293 $ 29,092 Total 300,499 300,499 (1) In May 2024, we agreed to implement a share repurchase program for an aggregate purchase price of $40.0 million to occur as follows: (i) first $15.0 million was to be effected through a Rule 10b5-1 plan initiated prior to June 1, 2024 and to be effective through June 30, 2025, and (ii) the remaining amount to be purchased in the open market (the “ 2024 Share Repurchase Program ”).
Biggest changeDec-20 Dec-21 Dec-22 Dec-23 Dec-24 Dec-25 Anika Therapeutics, Inc. $ 100.00 $ 79.16 $ 65.40 $ 50.07 $ 36.37 $ 21.23 NASDAQ Composite Index $ 100.00 $ 121.39 $ 81.21 $ 116.47 $ 149.83 $ 180.33 NASDAQ Biotechnology Index $ 100.00 $ 99.37 $ 88.53 $ 91.84 $ 90.58 $ 119.92 36 Issuer Purchases of Equity Securities The following is a summary of stock repurchases for the three-month period ended December 31, 2025 (in thousands, except share and per share data): Period (a) Total number of shares purchased (1) (b) Average Price per Share (c) Total number of shares purchased as part of publicly announced plans or programs (d) Maximum number (or approximate dollar value) of shares that may yet be purchased under the plans or programs October 1 to 31, 2025 - $ - - $ 25,000 November 1 to 30, 2025 219,660 $ 9.89 219,660 $ 22,828 December 1 to 31, 2025 342,454 $ 9.59 342,454 $ 19,543 Total 562,114 562,114 (1) In May 2024, we agreed to implement a share repurchase program for an aggregate purchase price of $40.0 million to occur as follows: (i) first $15.0 million was to be effected through a Rule 10b5-1 plan initiated prior to June 1, 2024 and to be effective through June 30, 2025, and (ii) the remaining amount to be purchased in the open market (the “ 2024 Share Repurchase Program ”).
Performance Graph Set forth below is a graph comparing the total returns of our company, the NASDAQ Composite Index, and the NASDAQ Biotechnology Index. The graph assumes $100 is invested on December 31, 2019, in our common stock and each of the indices. Past performance is not indicative of future results.
Performance Graph Set forth below is a graph comparing the total returns of our company, the NASDAQ Composite Index, and the NASDAQ Biotechnology Index. The graph assumes $100 is invested on December 31, 2020, in our common stock and each of the indices. Past performance is not indicative of future results.
MARKET FOR REGISTRANT ’ S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Common Stock Information Our common stock has traded on the NASDAQ Global Select Market since November 25, 1997, under the symbol “ANIK.” At December 31, 2024, the closing price per share of our common stock was $16.46 as reported on the NASDAQ Global Select Market, and there were 101 holders of record.
MARKET FOR REGISTRANT ’ S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Common Stock Information Our common stock has traded on the NASDAQ Global Select Market since November 25, 1997, under the symbol “ANIK.” At December 31, 2025, the closing price per share of our common stock was $9.61 as reported on the NASDAQ Global Select Market, and there were 96 holders of record.
On May 28, 2024, the Company entered into a share repurchase agreement under a Rule 10b5-1 with Bank of America. As of December 31, 2024, the Company had repurchased 505,903 shares at an average cost of $21.57 per share, representing 27% of the then estimated total number of shares expected to be repurchased under the 2024 Share Repurchase Program.
As of December 31, 2025, the Company had repurchased 1,308,545 shares at an average cost of $15.63 per share, representing 51% of the then estimated total number of shares expected to be repurchased under the 2024 Share Repurchase Program.
Added
On May 28, 2024, we entered into a share repurchase agreement under a Rule 10b5-1 plan with Bank of America and we completed the first $15.0 million tranche of the 2024 Share Repurchase Program in March 2025.
Added
On November 6, 2026, we entered into a share repurchase agreement under a Rule 10b5-1 plan with Clear Street LLC for another $15.0 million related to the 2024 Share Repurchase Program.

Item 7. Management's Discussion & Analysis

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

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Biggest changeResearch and Development Research and development expenses for the year ended December 31, 2024 were $25.5 million, an increase of $3.7 million, or 17%, as compared to the prior year, primarily due to increased costs to ensure compliance with growing regulatory requirements globally, such as EU MDR, as well as regulatory, clinical and product development costs associated with our research and development pipeline, led by Hyalofast, in which we submitted the first part of our modular PMA application with the FDA in October 2024.
Biggest changeResearch and Development Research and development costs for the years ended December 31, 2024 and 2023 were as follows: Years Ended December 31, 2024 2023 $ Change % Change (in thousands, except percentages) External costs by program Hyalofast clinical study $ 1,789 $ 1,712 $ 77 4 % Integrity development costs 943 2,290 (1,347 ) (59 %) Cingal clinical study 363 - 363 - % Regulatory external costs 2,728 2,612 116 4 % Other early programs and unallocated expenses 3,884 2,131 1,754 82 % Total external costs 9,707 8,745 962 11 % Internal costs: Employee compensation and benefits 13,779 11,259 2,520 22 % Facility and other 2,057 1,759 298 17 % Total internal costs 15,836 13,018 2,818 22 % Total research and development expense $ 25,544 $ 21,763 $ 3,781 17 % Research and development expenses for the year ended December 31, 2024 were $25.5 million, an increase of $3.7 million, or 17%, as compared to the prior year, primarily due to increased costs to ensure compliance with growing regulatory requirements globally, such as EU MDR, as well as regulatory, clinical and product development costs associated with our research and development pipeline, led by Hyalofast, in which we submitted the first part of our modular PMA application with the FDA in October 2024.
GAAP, and should not be considered in isolation of, or as an alternative to, measures prepared in accordance with U.S. GAAP. There are a number of limitations related to the use of adjusted EBITDA rather than net income (loss), which is the nearest U.S. GAAP equivalent.
Adjusted EBITDA is not prepared in accordance with U.S. GAAP, and should not be considered in isolation of, or as an alternative to, measures prepared in accordance with U.S. GAAP. There are a number of limitations related to the use of adjusted EBITDA rather than net income (loss), which is the nearest U.S. GAAP equivalent.
This is generally in the same period that our licensees complete their product sales in their territory, for which we are contractually entitled to a percentage-based royalty. We record royalty revenues based on estimated net sales of licensed products as reported to us by our commercial partners.
This is generally in the same period that our commercial partners complete their product sales in their territory, for which we are contractually entitled to a percentage-based royalty. We record royalty revenues based on estimated net sales of licensed products as reported to us by our commercial partners.
Income (Loss) from Operations For the year ended December 31, 2024, the loss from operations was $5.1 million, compared to income from operations of $0.8 million for the prior year. The $5.9 million decrease in income from operations was due to lower gross profit and higher research and development costs.
Income (Loss) from Continuing Operations For the year ended December 31, 2024, the loss from operations was $5.1 million, compared to income from operations of $0.8 million for the prior year. The $5.9 million decrease in income from operations was due to lower gross profit and higher research and development costs.
For sales to hospitals and ambulatory service centers, which generally pairs in-house sales representatives with local or regional distributors, the inventory is generally consigned so that products are available when needed for surgical procedures. No revenue is recognized upon the placement of inventory into consignment, as we retain the ability to control the inventory.
For sales to hospitals and ambulatory service centers, which generally pair in-house sales representatives with local or regional distributors, the inventory is generally consigned so that products are available when needed for surgical procedures. No revenue is recognized upon the placement of inventory into consignment, as we retain the ability to control the inventory.
Subject to certain conditions, we may request up to an additional $75.0 million for a maximum aggregate commitment of $150.0 million. As of December 31, 2024, and 2023, there were no outstanding borrowings, and we are in compliance with the terms of the credit facility.
Subject to certain conditions, we may request up to an additional $75.0 million for a maximum aggregate commitment of $150.0 million. As of December 31, 2025, and 2024, there were no outstanding borrowings, and we are in compliance with the terms of the credit facility.
Cingal is our next generation fast-acting, long-lasting, non-opioid, clinically proven osteoarthritis pain product which is designed to provide both short- and long-term pain relief, through at least six months. It is currently sold outside the United States in over 35 countries. In 2022, we completed a third Phase III clinical trial for Cingal, which achieved its primary endpoint.
Cingal is our next generation fast-acting, long-lasting, non-opioid, clinically proven osteoarthritis pain product which is designed to provide both short- and long-term pain relief, through at least six months. It is currently sold outside the United States in 53 countries. In 2022, we completed a third Phase III clinical trial for Cingal, which achieved its primary endpoint.
Actual results may differ from our estimates if past experience or other assumptions do not turn out to be substantially accurate. 49 We have identified the policies below as critical to our business operations and the understanding of our results of operations.
Actual results may differ from our estimates if past experience or other assumptions do not turn out to be substantially accurate. 46 We have identified the policies below as critical to our business operations and the understanding of our results of operations.
Contractual Obligations and Other Commercial Commitments The table below summarizes our non-cancelable operating leases, purchase commitments, and contractual obligations related to future periods which are not reflected in our consolidated balance sheet at December 31, 2024.
Contractual Obligations and Other Commercial Commitments The table below summarizes our non-cancelable operating leases, purchase commitments, and contractual obligations related to future periods which are not reflected in our consolidated balance sheet at December 31, 2025.
In those contracts in which we pay for the shipping and handling, the associated costs are generally recorded along with the product sale at the time of shipment in cost of revenue when control over the products has transferred to the customer. Value-add and other taxes we collected concurrently with revenue-producing activities are excluded from revenue.
In those contracts in which we pay for shipping and handling, the associated costs are generally recorded along with the product sale at the time of shipment in cost of revenue when control over the products has been transferred to the customer. Value-added and other taxes we collected concurrently with revenue-producing activities are excluded from revenue.
Some of these limitations are: 43 • adjusted EBITDA excludes depreciation and amortization, and, although these are non-cash expenses, the assets being depreciated or amortized may have to be replaced in the future, the cash requirements for which are not reflected in adjusted EBITDA; • we exclude stock-based compensation expense from adjusted EBITDA although (a) it has been, and will continue to be for the foreseeable future, a significant recurring expense for our business and an important part of our employee compensation strategy and (b) if we did not pay out a portion of our compensation in the form of stock-based compensation, the cash salary and bonus expense included in operating expenses likely would be higher, which would affect our cash position; • we exclude acquisition related expenses, including transaction costs and other related expenses, amortization and depreciation of acquired assets in recent acquisitions, and the impact of inventory fair-value step up on cost of goods sold; • we exclude certain impairment charges, including impairment related to intangible assets, certain product rationalization charges; • we exclude goodwill impairment charges and changes in the fair value of contingent consideration; • we exclude certain other non-recurring costs, such as costs associated with shareholder activism; • the expenses and other items that we exclude in our calculation of adjusted EBITDA may differ from the expenses and other items, if any, that other companies may exclude from adjusted EBITDA when they report their operating results; • adjusted EBITDA does not reflect changes in, or cash requirements for, working capital needs; • adjusted EBITDA does not reflect provision for (benefit from) income taxes or the cash requirements to pay taxes; and • adjusted EBITDA does not reflect historical cash expenditures or future requirements for capital expenditures or contractual commitments.
Some of these limitations are: • adjusted EBITDA excludes depreciation and amortization, and, although these are non-cash expenses, the assets being depreciated or amortized may have to be replaced in the future, the cash requirements for which are not reflected in adjusted EBITDA; • we exclude stock-based compensation expense from adjusted EBITDA although (a) it has been, and will continue to be for the foreseeable future, a significant recurring expense for our business and an important part of our employee compensation strategy and (b) if we did not pay out a portion of our compensation in the form of stock-based compensation, the cash salary and bonus expense included in operating expenses likely would be higher, which would affect our cash position; • we exclude acquisition related expenses, including transaction costs and other related expenses, amortization and depreciation of acquired assets in recent acquisitions ; • we exclude certain impairment charges, including impairment related to intangible assets, certain product rationalization charges; • we exclude goodwill impairment charges and changes in the fair value of contingent consideration; • we exclude certain other non-recurring costs, such as costs associated with shareholder activism; • the expenses and other items that we exclude in our calculation of adjusted EBITDA may differ from the expenses and other items, if any, that other companies may exclude from adjusted EBITDA when they report their operating results; • adjusted EBITDA does not reflect changes in, or cash requirements for, working capital needs; • adjusted EBITDA does not reflect provision for (benefit from) income taxes or the cash requirements to pay taxes; and • adjusted EBITDA does not reflect historical cash expenditures or future requirements for capital expenditures or contractual commitments.
For the foreseeable future, we expect to continue to invest in research and development for new products and clinical trials related to our HA-based technology to support our growth strategy. These costs will be funded with a combination of cash on hand and cash expected to be generated from future operations.
For the foreseeable future, we expect to continue to invest in research and development for new products and clinical trials related to our HA-based technology to support our growth strategy, particularly on Cingal and Integrity. These costs will be funded with a combination of cash on hand and cash expected to be generated from future operations.
We have presented adjusted gross profit and adjusted gross margin, adjusted EBITDA, adjusted net income, adjusted EPS, because they are key measures used by our management and board of directors to understand and evaluate our operating performance and to develop operational goals for managing our business.
We have presented adjusted EBITDA, adjusted net income, adjusted EPS, because they are key measures used by our management and board of directors to understand and evaluate our operating performance and to develop operational goals for managing our business.
Integrity Implant System and Hyalofast) markets; ● Launching the Integrity Implant System, our arthroscopic patch system for rotator cuff repair, in 2024; ● Targeting to introduce key HA-based products into the US market upon FDA approval/clearance, such as Cingal and Hyalofast, and developing additional products that leverage our proprietary Hyaff regenerative platform; ● Robust network of stakeholders in our target markets to identify evolving unmet patient treatment needs; ● Global commercial expertise which we will leverage to drive growth across our product portfolio, including continued international expansion; ● Opportunity to pursue strategic inorganic growth opportunities, including potential partnerships and smaller acquisitions, technology licensing, and leveraging our strong financial foundation and operational capabilities; and ● Energized and experienced team focused on strong values, talent, and culture.
Integrity Implant System and Hyalofast) markets; ● Growth of the Integrity Implant System, our HA-based scaffold for rotator cuff and other tendon repairs; ● Targeting to introduce key HA-based products into the US market upon FDA approval/clearance, such as Cingal and Hyalofast, and developing additional products that leverage our proprietary Hyaff regenerative platform; ● Robust network of stakeholders in our target markets to identify evolving unmet patient treatment needs; ● Global commercial expertise which we will leverage to drive growth across our product portfolio, including continued international expansion; ● Opportunity to pursue strategic inorganic growth opportunities, including potential partnerships and smaller acquisitions, technology licensing, and leveraging our strong financial foundation and operational capabilities; and ● Energized and experienced team focused on strong values, talent, and culture.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our annual report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on March 15, 2024, which is incorporated by reference in this Report.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our annual report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on March 17, 2025, which is incorporated by reference in this Report.
We also have Notes Receivable that we have recorded as consideration related to the divestiture of the Arthrosurface asset group in which repayment will be dependent upon the cash flows from the Arthrosurface asset group.
We also have Notes Receivable that we have recorded as consideration related to the divestiture of the Arthrosurface asset group in which repayment will be dependent upon the cash receipts that we receive from Arthrosurface.
We define adjusted net loss from continuing operations as our net loss from continuing operations excluding amortization and depreciation of acquired assets, the impact of inventory fair-value step up on cost of revenue, changes in the fair value of contingent consideration, as well as certain impairment charges, including impairment related to IPR&D assets and non-cash product rationalization charges, each on a tax effected basis.
We define adjusted net loss from continuing operations as our net loss from continuing operations excluding amortization and depreciation of acquired assets, changes in the fair value of contingent consideration, as well as certain impairment charges, including impairment related to IPR&D assets and non-cash product rationalization charges, each on a tax effected basis.
The increase in our effective rate for the year ended December 31, 2023 as compared to the year ended December 31, 2022 is primarily due to a higher valuation allowance being recorded on U.S. deferred tax assets in 2023. 47 Concentration of Risk We have historically derived the majority of our revenue from a small number of customers, most of whom resell our products to end-users and are significantly larger companies than us.
The decrease in our effective rate for the year ended December 31, 2024 as compared to the year ended December 31, 2023 is primarily due to a lower valuation allowance being recorded on U.S. deferred tax assets in 2024. 44 Concentration of Risk We have historically derived most of our revenue from a small number of customers, most of whom resell our products to end-users and are significantly larger companies than us.
Business” of this Annual Report on Form 10-K. 39 Products OA Pain Management Our OA Pain Management product family consists of Monovisc and Orthovisc, our injectable, HA-based OA Pain Management offerings that are indicated to provide pain relief from osteoarthritis conditions; and Cingal, our novel, next-generation, single-injection OA Pain Management product consisting of our proprietary cross-linked HA material combined with a fast-acting steroid.
Products OA Pain Management Our OA Pain Management product family consists of Monovisc and Orthovisc, our injectable, HA-based OA Pain Management offerings that are indicated to provide pain relief from osteoarthritis conditions; and Cingal, our novel, next-generation, single-injection OA Pain Management product consisting of our proprietary cross-linked HA material combined with a fast-acting steroid.
Purchase commitments relate primarily to non-cancellable inventory commitments and capital expenditures entered in the normal course of business: Payments due by period (in thousands) Less than More than Total 1 year 1 - 3 years 3 - 5 years 5 years Operating Leases $ 32,810 $ 2,783 $ 4,797 $ 4,658 $ 20,572 Year Ended December 31, 2024 $ 32,810 $ 2,783 $ 4,797 $ 4,658 $ 20,572 We also have purchase orders and commitments for materials and other day-to-day business requirements in which there are no material commitments greater than one year.
Purchase commitments relate primarily to non-cancellable inventory commitments and capital expenditures entered in the normal course of business: Payments due by period (in thousands) Less than More than Total 1 year 1 - 3 years 3 - 5 years 5 years Operating Leases $ 32,733 $ 2,848 $ 5,544 $ 5,544 $ 18,797 Year Ended December 31, 2025 $ 32,733 $ 2,848 $ 5,544 $ 5,544 $ 18,797 We also have purchase orders and commitments for materials and other day-to-day business requirements in which there are no material commitments greater than one year.
For the year ended December 31, 2024, J&J MedTech accounted for 57% of revenue, as compared to 62% in prior year.
For the year ended December 31, 2025, J&J MedTech accounted for 50% of revenue, as compared to 57% in prior year.
We recognize revenue from product sales when the distributor obtains control of our product, which typically occurs upon shipment to the distributor, in return for agreed-upon, fixed-price consideration. Performance obligations are generally settled quickly after purchase order acceptance; therefore, the value of unsatisfied performance obligations at the end of any reporting period is generally insignificant.
We recognize revenue from product sales when the distributor obtains control of our product, which typically occurs upon shipment to the distributor, in return for agreed-upon, fixed-price consideration. Performance obligations are generally settled quickly after purchase order acceptance.
This strategic decision involved the sale of Arthrosurface Incorporated in October 2024 and the divestiture of Parcus Medical, LLC, in March 2025. As we look towards the future, our business is positioned to capture value within our target market of OA Pain Management and Regenerative Solutions product portfolios.
In 2024, we refined our strategic focus to prioritize OA Pain Management and regenerative solutions and, consistent with this focus, divested Arthrosurface Incorporated in October 2024 and Parcus Medical, LLC in March 2025. As we look forward to the future, our business is positioned to capture value within our target market of OA Pain Management and Regenerative Solutions product portfolios.
We also launched a full market release of Integrity in the U.S. in 2024. 41 Gross Profit and Margin Gross profit for the year ended December 31, 2024 was $76.0 million, or gross margin of 63%, as compared with $82.5 million, or gross margin of 68%, for the year ended December 31, 2023.
We also launched a full market release of Integrity in the U.S. in 2024 which contributed to a $1.7 million increase in regenerative product sales during the year ended December 31, 2024. 43 Gross Profit and Margin Gross profit for the year ended December 31, 2024 was $76.0 million, or gross margin of 63%, as compared with $82.5 million, or gross margin of 68%, for the year ended December 31, 2023.
Summary of Cash Flows (in thousands): Years Ended December 31, 2024 2023 2022 Cash provided by (used in) Operating activities $ 5,403 $ (1,788 ) $ 4,409 Investing activities (8,334 ) (5,427 ) (7,486 ) Financing activities (12,729 ) (6,324 ) (4,852 ) Effect of exchange rate changes on cash (48 ) 79 (130 ) Net decrease in cash and cash equivalents $ (15,708 ) $ (13,460 ) $ (8,059 ) 48 The following changes contributed to the net change in cash and cash equivalents from 2023 to 2024.
Summary of Cash Flows (in thousands): Years Ended December 31, 2025 2024 2023 Cash provided by (used in) Operating activities $ 11,188 $ 5,403 $ (1,788 ) Investing activities (401 ) (8,334 ) (5,427 ) Financing activities (10,551 ) (12,729 ) (6,324 ) Effect of exchange rate changes on cash 86 (48 ) 79 Net increase (decrease) in cash and cash equivalents $ 322 $ (15,708 ) $ (13,460 ) 45 The following changes contributed to the net change in cash and cash equivalents from 2024 to 2025.
The differences between actual and estimated royalty revenues have not been material and are typically adjusted in the following quarter when the actual amounts are known. Revenue from sales-based royalties is included in revenues in our consolidated statement of operations.
The differences between actual and estimated royalty revenues have not been material and are typically adjusted in the following quarter when the actual amounts are known. Revenue from sales-based royalties is included in revenues in our consolidated statement of operations. Our largest customer, J&J MedTech, represented 50% of total revenues for the year ended December 31, 2025.
Our proprietary technologies for modifying the HA molecule allow product properties to be tailored specifically to multiple uses, including enabling longer residence time to support OA Pain Management and creating a solid form of HA called Hyaff, which is a platform utilized in our regenerative solutions portfolio. 38 In early 2020, we expanded our overall technology platform, product portfolio, and significantly expanded our commercial infrastructure, especially in the United States, through our strategic acquisitions of Parcus Medical, LLC, a sports medicine and instrumentation solutions provider, and Arthrosurface Incorporated, a company specializing in bone preserving partial and total joint replacement solutions.
Our proprietary technologies for modifying the HA molecule allow product properties to be tailored specifically to multiple uses, including enabling longer residence time to support OA Pain Management and creating a solid form of HA called Hyaff, which is a platform utilized in our regenerative solutions portfolio. 37 In early 2020, we expanded our product portfolio and commercial capabilities through the acquisitions of Parcus Medical, LLC and Arthrosurface Incorporated, adding sports medicine, joint preservation, and instrumentation offerings to our business.
Cingal is currently not approved for commercial use in the United States. We have been actively engaging with the U.S. Food and Drug Administration (“FDA”) on next steps for U.S. regulatory approval. We acquired the Aristospan New Drug Application (“NDA”) regulatory approval in the United States in September 2024 to assist with our Cingal regulatory filing with the FDA.
Cingal is currently not approved for commercial use in the United States. We have been actively engaging with the U.S. Food and Drug Administration (“FDA”) on next steps for U.S. regulatory approval.
We expect that our requirements for cash to fund these uses will increase as our operations expand.
We expect that our requirements for cash to fund these uses will increase as our operations, particularly for our expansion of manufacturing capacity.
Selling, General and Administrative Selling, general and administrative (“SG&A”) expenses for the year ended December 31, 2024 were $55.6 million, a decrease of $4.4 million, or 7%, as compared to the prior year. The decrease in SG&A expenses for the year ended December 31, 2023 was primarily due to lower headcount and reduced shareholder activism costs.
Selling, General and Administrative Selling, general and administrative (“SG&A”) expenses for the year ended December 31, 2024 were $55.6 million, a decrease of $4.4 million, or 7%, as compared to the prior year.
Income Taxes The provision for income taxes was $6.6 million for the year ended December 31, 2023, resulting in an effective tax rate of 209.0%. The provision from income taxes was $2.1 million for the year ended December 31, 2022, resulting in an effective tax rate of 49.1%.
The provision from income taxes was $6.1 million for the year ended December 31, 2024, resulting in an effective tax rate of (219.4%).
Business” of this Annual Report on Form 10-K. 40 Results of Operations Year ended December 31, 2024 compared to year ended December 31, 2023 Statement of Operations Detail Year Ended December 31, 2024 2023 $ Change % Change (in thousands, except percentages) Revenue $ 119,907 $ 120,792 $ (885 ) (1 %) Cost of revenue 43,909 38,260 5,649 15 % Gross profit 75,998 82,532 (6,534 ) (8 %) Gross margin 63 % 68 % Operating expenses: Research & development 25,544 21,763 3,781 17 % Selling, general & administrative 55,555 59,925 (4,370 ) (7 %) Total operating expenses 81,099 81,688 (589 ) (1 %) (Loss) income from operations (5,101 ) 844 (5,945 ) (704 %) Interest and other expense, net 2,337 2,312 25 1 % (Loss) income before income taxes (2,764 ) 3,156 (5,920 ) (188 %) Provision for (benefit from) income taxes 6,064 6,595 (531 ) (8 %) Loss from continuing operations (8,828 ) (3,439 ) (5,389 ) 157 % Loss from discontinued operations, net of tax (47,557 ) (79,228 ) 31,671 (40 %) Net loss $ (56,385 ) $ (82,667 ) $ 26,282 (32 %) Revenue During the year ended December 31, 2024, we changed our classification of revenue.
The decrease in adjusted net income from continuing operations and adjusted diluted income from continuing operations per share for the period was primarily due to lower revenues and higher manufacturing expenses during the year. 42 Results of Operations Year ended December 31, 2024 compared to year ended December 31, 2023 Statement of Operations Detail Year Ended December 31, 2024 2023 $ Change % Change (in thousands, except percentages) Revenue $ 119,907 $ 120,792 $ (885 ) (1 %) Cost of revenue 43,909 38,260 5,649 15 % Gross profit 75,998 82,532 (6,534 ) (8 %) Gross margin 63 % 68 % Operating expenses: Research & development 25,544 21,763 3,781 17 % Selling, general & administrative 55,555 59,925 (4,370 ) (7 %) Total operating expenses 81,099 81,688 (589 ) (1 %) (Loss) income from operations (5,101 ) 844 (5,945 ) (704 %) Interest and other expense, net 2,337 2,312 25 1 % (Loss) income before income taxes (2,764 ) 3,156 (5,920 ) (188 %) Provision for (benefit from) income taxes 6,064 6,595 (531 ) (8 %) Loss from continuing operations (8,828 ) (3,439 ) (5,389 ) 157 % Loss from discontinued operations, net of tax (47,557 ) (79,228 ) 31,671 (40 %) Net loss $ (56,385 ) $ (82,667 ) $ 26,282 (32 %) Revenue The following table presents revenue by product family for fiscal years 2024 and 2023 (dollars in thousands): Years Ended December 31, 2024 2023 $ Change % Change OEM Channel $ 77,770 $ 84,645 $ (6,875 ) (8 %) Commercial Channel 42,137 36,147 5,990 17 % $ 119,907 $ 120,792 $ (885 ) (1 %) Revenue for the year ended December 31, 2024 was $119.9 million, a decrease of $0.9 million, or 1%, compared to the prior year.
The following is a reconciliation of adjusted net income from continuing operations to net loss from continuing operations for the years ended December 31, 2024 and 2023, respectively: Years Ended December 31, 2024 2023 Net loss from continuing operations $ (8,828 ) $ (3,439 ) Product rationalization charges, tax effected 457 725 Share-based compensation, tax effected 9,167 13,114 Costs of shareholder activism, tax effected 1,647 2,938 Adjusted net income from continuing operations $ 2,443 $ 13,338 The following is a reconciliation of adjusted diluted income from continuing operations per share to diluted loss from continuing operations per share for the years ended December 31, 2024 and 2023, respectively (in thousands, expect per share data): Years Ended December 31, 2024 2023 Diluted loss from continuing operations per share $ (0.60 ) $ (0.23 ) Product rationalization charges, tax effected 0.03 0.05 Share-based compensation, tax effected 0.62 0.89 Costs of shareholder activism, tax effected 0.11 0.20 Adjusted diluted income from continuing operations per share $ 0.16 $ 0.91 Adjusted net income from continuing operations in 2024 was $2.4 million, a decrease of $10.9 million as compared to 2023.
The following is a reconciliation of adjusted net income from continuing operations to net loss from continuing operations for the years ended December 31, 2025 and 2024, respectively: Years Ended December 31, 2025 2024 Net loss from continuing operations $ (9,979 ) $ (8,828 ) Product rationalization charges, tax effected - 457 Share-based compensation, tax effected 10,954 9,167 Non-recurring professional fees, tax effected 639 - Costs of shareholder activism, tax effected - 1,647 Adjusted net income from continuing operations $ 1,614 $ 2,443 The following is a reconciliation of adjusted diluted income from continuing operations per share to diluted loss from continuing operations per share for the years ended December 31, 2025 and 2024, respectively (in thousands, expect per share data): Years Ended December 31, 2025 2024 Diluted loss from continuing operations per share $ (0.70 ) $ (0.60 ) Product rationalization charges, tax effected - 0.03 Share-based compensation, tax effected 0.77 0.62 Non-recurring professional fees 0.04 - Costs of shareholder activism, tax effected - 0.11 Adjusted diluted income from continuing operations per share $ 0.11 $ 0.16 Adjusted net income from continuing operations in 2025 was $1.6 million, a decrease of $0.8 million as compared to 2024.
Amounts are recorded as accounts receivable when our right to consideration is unconditional. There was no deferred revenue as of December 31, 2024 and 2023, respectively. 50 Generally, customer contracts contain Free on Board (“FOB”) or Ex-Works shipping point terms where the customer pays the shipping company directly for all shipping and handling costs.
There was no deferred revenue as of December 31, 2025 and 2024, respectively. 47 Generally, customer contracts contain Free on Board (“FOB”) or Ex-Works shipping point terms where the customer pays the shipping company directly for all shipping and handling costs.
The following is a reconciliation of adjusted EBITDA to net loss from operations for the years ended December 31, 2024 and 2023 respectively: Years Ended December 31, 2024 2023 Net loss from continuing operations $ (8,828 ) $ (3,439 ) Interest and other expense, net (2,337 ) (2,312 ) Provision for income taxes 6,064 6,595 Depreciation and amortization 5,688 5,506 Stock-based compensation 12,158 13,537 Product rationalization charges 606 748 Costs of shareholder activism 2,185 3,033 Adjusted EBITDA $ 15,536 $ 23,668 Adjusted EBITDA for year ended December 31, 2024 was $15.5 million, a decrease of $8.2 million as compared to 2023.
The following is a reconciliation of adjusted EBITDA to net loss from operations for the years ended December 31, 2025 and 2024 respectively: Years Ended December 31, 2025 2024 Net loss from continuing operations $ (9,979 ) $ (8,828 ) Interest and other income, net (1,744 ) (2,337 ) Provision for income taxes 672 6,064 Depreciation and amortization 5,580 5,688 Stock-based compensation 10,216 12,158 Product rationalization charges - 606 Non-recurring professional fees 596 - Costs of shareholder activism - 2,185 Adjusted EBITDA $ 5,341 $ 15,536 Adjusted EBITDA for year ended December 31, 2025 was $5.3 million, a decrease of $10.2 million as compared to 2024.
Revenue from our OEM Channel product family decreased 8% for the year ended December 31, 2024, as compared to prior year, due to lower J&J MedTech revenue, mostly related to Orthovisc and the discontinuation of certain non-orthopedic products.
Revenue from our OEM Channel product family decreased 8% for the year ended December 31, 2024, as compared to prior year, due to lower J&J MedTech revenue, primarily due to lower volumes resulting in a decrease of $4.3 million and lower pricing contributing to a $1.6 million decrease and the discontinuation of certain non-orthopedic products resulting in a decrease of $1.1 million.
If the prospective discounts or free-of-charge sample units are considered material rights, these would be separate performance obligations and a portion of the sales transaction price is allocated to the material right. Revenue allocated to the material right is recognized when the additional goods are transferred to the customer or when the option expires.
These prospective discounts together with any free-of-charge sample units offered are evaluated as potential material rights. If the prospective discounts or free-of-charge sample units are considered material rights, these would be separate performance obligations, and a portion of the sales transaction price is allocated to the material right.
The decrease in our effective rate for the year ended December 31, 2024 as compared to the year ended December 31, 2023 is primarily due to a lower valuation allowance being recorded on U.S. deferred tax assets in 2024. 42 Non-GAAP Financial Measures We present certain information with respect to adjusted gross profit and adjusted gross margin, adjusted Earnings Before Interest, Tax, Depreciation and Amortization (“EBITDA”), adjusted net income, adjusted diluted earnings per share or adjusted Earnings Per Share (“EPS”), which are financial measures not based on any standardized methodology prescribed by accounting principles generally accepted in the United States (“GAAP”), and is not necessarily comparable to similarly titled measures presented by other companies.
Non-GAAP Financial Measures We present certain information with respect to adjusted Earnings Before Interest, Tax, Depreciation and Amortization (“EBITDA”), adjusted net income, adjusted diluted earnings per share or adjusted Earnings Per Share (“EPS”), which are financial measures not based on any standardized methodology prescribed by accounting principles generally accepted in the United States (“GAAP”), and is not necessarily comparable to similarly titled measures presented by other companies.
Financing Activities Cash used in financing activities was $12.7 million, $6.3 million and $4.9 million for 2024, 2023 and 2022, respectively. The change in 2024 was primarily due to $10.9 million used to fund the stock repurchase program we started in May 2024.
Financing Activities Cash used in financing activities was $10.6 million, $12.7 million and $6.3 million for 2025, 2024 and 2023, respectively. The decrease in cash used in financing activities was primarily due a reduction in stock repurchases as we incurred $9.5 million in 2025 versus $10.9 million on the stock repurchase program we started in May 2024.
Cash, cash equivalents, and investments aggregated $55.6 million and $68.7 million, and working capital totaled $90.3 million and $132.3 million, at December 31, 2024 and 2023, respectively.
Cash and cash equivalents aggregated $57.5 million and $55.6 million, and working capital totaled $80.2 million and $90.3 million, at December 31, 2025 and 2024, respectively.
The following table presents revenue by product family for fiscal years 2024 and 2023 (dollars in thousands): Years Ended December 31, 2024 2023 $ Change % Change OEM Channel $ 77,770 $ 84,645 $ (6,875 ) (8 %) Commercial Channel 42,137 36,147 5,990 17 % $ 119,907 $ 120,792 $ (885 ) (1 %) Revenue for the year ended December 31, 2024 was $119.9 million, a decrease of $0.9 million, or 1%, compared to the prior year.
The following table presents revenue by product family for fiscal years 2025 and 2024 (dollars in thousands): Years Ended December 31, 2025 2024 $ Change % Change OEM Channel $ 64,406 $ 77,770 $ (13,364 ) (17 %) Commercial Channel 48,413 42,137 6,276 15 % $ 112,819 $ 119,907 $ (7,088 ) (6 %) Revenue for the year ended December 31, 2025 was $112.8 million, a decrease of $7.1 million, or 6%, compared to the prior year.
For a discussion of our liquidity and capital resources as of December 31, 2023, and our cash flow activities for the fiscal year ended December 31, 2023, see “Part II, Item 7.
We also had lower payments in cash withheld for taxes related the vesting of restricted stock awards. For a discussion of our liquidity and capital resources as of December 31, 2024, and our cash flow activities for the fiscal year ended December 31, 2024, see “Part II, Item 7.
Accordingly, we believe that these measures provide useful information to investors and others in understanding and evaluating our operating results, enhancing the overall understanding of our past performance and future prospects and allowing for greater transparency with respect to key financial metrics used by our management in their financial and operational decision-making.
Accordingly, we believe that these measures provide useful information to investors and others in understanding and evaluating our operating results, enhancing the overall understanding of our past performance and future prospects and allowing for greater transparency with respect to key financial metrics used by our management in their financial and operational decision-making. 40 Adjusted EBITDA We present information below with respect to adjusted EBITDA, which we define as our net loss excluding interest and other income, net, income tax benefit, depreciation and amortization, stock-based compensation, product rationalization charges, and other non-recurring expenses.
As we considered the license to be the predominant item to which the royalties relate for these agreements, sales-based royalties and milestones are only recognized when the later of the underlying sale occurs or the performance obligation to which some or all of the sales-based royalty has been satisfied (or partially satisfied).
Sales-based royalties and milestones are only recognized when the latter of the underlying sale occurs or the performance obligation to which some or all of the sales-based royalties have been satisfied (or partially satisfied).
We assess if these options provide a material right to the licensee, and if so, they are accounted for as separate performance obligations. Our supply agreements do not provide options that are considered material rights. Our payment terms are consistent with prevailing practice in the respective markets in which we do business.
Certain of our supply agreements contain terms that represent a promise to deliver product at the customer’s discretion that are considered distributor options. We assess if these options provide a material right to the licensee, and if so, they are accounted for as separate performance obligations. Our supply agreements do not provide options that are considered material rights.
In the OEM Channel, we are responsible for development and manufacturing of products sold to our OEM partners governed by long-term agreements, but we do not control sales, marketing, or pricing with end users. Revenue from our U.S. OA Pain Management business and the Non-Orthopedic business is now included in the OEM Channel.
In the OEM Channel, we are responsible for development and manufacturing of products sold to our OEM partners governed by long-term agreements, but we do not control sales, marketing, or pricing with end users. In the Commercial Channel, we have full responsibility for sales, marketing, and pricing of products through our commercial leaders, direct sales representatives, and independent distributors.
These arrangements may include the grant of certain licenses, performance of development services, and the supply of product. Our largest such customer, J&J MedTech, represented 57% of total revenues for the year ended December 31, 2024. We recognize revenue from product sales when the customer obtains control of our product, which typically occurs upon shipment to the customer.
These arrangements may include the grant of certain licenses, performance of development services, and the supply of products. We recognize revenue from product sales when the customer obtains control of our product, which typically occurs upon shipment to the customer. Commercial partnership agreements may also include sales-based royalties and milestones.
During 2024, the consideration allocated to material rights was not significant. We receive payments from our customers based on billing schedules established in each contract. Up-front payments and fees are recorded as deferred revenue upon receipt or when due and may require deferral of revenue recognition to a future period until we perform our obligations under these arrangements.
Up-front payments and fees are recorded as deferred revenue upon receipt or when due and may require deferral of revenue recognition to a future period until we perform our obligations under these arrangements. Amounts are recorded as accounts receivable when our right to consideration is unconditional.
The decrease in adjusted EBITDA was primarily due to lower adjusted gross profit and higher research and development spending in 2024 on product development and clinical activity, primarily with Integrity, Hyalofast and Cingal. 44 Adjusted Net Loss and Adjusted EPS from Continuing Operations We present information below with respect to adjusted net loss and adjusted EPS from continuing operations.
The decrease in adjusted EBITDA was primarily due to lower revenues, primarily related to J&J MedTech and lower gross profit due to higher inventory reserves and manufacturing costs. 41 Adjusted Net Loss and Adjusted EPS from Continuing Operations We present information below with respect to adjusted net loss and adjusted EPS from continuing operations.
For additional information regarding our business, please refer to “Item 1.
For additional information regarding our business, please refer to “Item 1. Business” of this Annual Report on Form 10-K.
Operating Activities Cash provided by (used in) operating activities was $5.4 million, $(1.8) million and $4.4 million for 2024, 2023 and 2022, respectively. The change in 2024 was primarily attributable to a lower net loss in 2024, compared to the same period in 2023.
Operating Activities Cash provided by (used in) operating activities was $11.2 million, $5.4 million and $(1.8) million for 2025, 2024 and 2023, respectively.
Most of our customers make payments based on contract terms, which are not affected by contingent events that could impact the transaction price. Payment terms fall within the one-year guidance for the practical expedient, which allows us to forgo adjustment of the contractual payment amount of consideration for the effects of a significant financing component.
Payment terms fall within the one-year guidance for the practical expedient, which allows us to forgo adjustment of the contractual payment amount of consideration for the effects of a significant financing component. Some of our distributor agreements have volume-based discounts with tiered pricing which are generally prospective in nature.
Revenue from our OEM channel product family increased 4% for the year ended December 31, 2023, as compared to prior year, due to domestic sales growth of our Monovisc single injection pain product and favorable ordering patterns from J&J MedTech.
Revenue from our Commercial Channel product family increased 15% for the year ended December 31, 2025, as compared to prior year, due to international sales growth on Cingal and Orthovisc, offset by lower Monovisc shipments due to manufacturing delays.
Income from Operations For the year ended December 31, 2023, the loss from operations was $0.8 million, compared to income from operations of $3.7 million for the prior year. The $2.8 million decrease in income from operations was due higher operating expenses.
The $1.2 million decrease in the loss from continuing operations was due to lower revenues, primarily from J&J MedTech offset somewhat by lower operating expenses, primarily related to lower SG&A expenses. Income Taxes The provision for income taxes was $0.7 million for the year ended December 31, 2025, resulting in an effective tax rate of (7.1%).
Investing Activities Cash used in investing activities was $8.3 million, $5.4 million and $7.5 million for 2024, 2023 and 2022, respectively. The change was primarily due to an increase in capital expenditures in 2024 to support the expansion of manufacturing capacity at our Bedford facility and a purchase of developed technology for $0.6 million.
The decrease in cash used in investing activities was primarily related to proceeds received from the sales of Arthrosurface and Parcus Medical offset by an increase in capital expenditures in 2025 to support the expansion of manufacturing capacity at our Bedford facility.
Revenue has been split between the Commercial Channel and the Original Equipment Manufacturer (“OEM”) Channel. In the Commercial Channel, we have full responsibility for sales, marketing, and pricing of products through our commercial leaders, direct sales representatives, and independent distributors. Revenue from our Regenerative Solutions and international OA Pain Management businesses is included in the Commercial Channel.
Revenue from our Regenerative Solutions and international OA Pain Management businesses is included in the Commercial Channel.
Selling, General and Administrative Selling, general and administrative (“SG&A”) expenses for the year ended December 31, 2023 were $59.9 million, an increase of $8.7 million, or 17%, as compared to the prior year. The increase in SG&A expenses for the year ended December 31, 2023 was primarily due to shareholder activism and related corporate costs during the year.
The decrease in SG&A expenses for the year ended December 31, 2025 was due primarily to lower general and administrative expenses such as $2.2 million in shareholder activism costs that occurred in prior year, $1.5 decrease in stock-based compensation and the remainder attributable to lower headcount and professional fees.
We sell to a diversified base of distributors and, therefore, we believe there is no material concentration of credit risk. Certain of our supply agreements contain terms that represent a promise to deliver product at the customer’s discretion that are considered distributor options.
We have no performance obligations greater than one year; therefore, the value of unsatisfied performance obligations at the end of any reporting period is generally insignificant. We sell to a diversified base of distributors and, therefore, we believe there is no material concentration of credit risk.
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These acquisitions augmented our HA-based OA Pain Management and regenerative products with a broad suite of products and capabilities focused on early intervention joint preservation primarily in upper and lower extremities such as shoulder, foot/ankle, knee and hand/wrist. In October 2024, we announced a strategic shift to concentrate on OA Pain Management and our Regenerative Solutions products.
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Business” of this Annual Report on Form 10-K. 38 Results of Operations Year ended December 31, 2025 compared to year ended December 31, 2024 Statement of Operations Detail Year Ended December 31, 2025 2024 $ Change % Change (in thousands, except percentages) Revenue $ 112,819 $ 119,907 $ (7,088 ) (6 %) Cost of revenue 49,012 43,909 5,103 12 % Gross profit 63,807 75,998 (12,191 ) (16 %) Gross margin 57 % 63 % Operating expenses: Research & development 25,770 25,544 226 1 % Selling, general & administrative 49,088 55,555 (6,467 ) (12 %) Total operating expenses 74,858 81,099 (6,241 ) (8 %) Loss from operations (11,051 ) (5,101 ) (5,950 ) 117 % Interest and other income, net 1,744 2,337 (593 ) (25 %) Loss before income taxes (9,307 ) (2,764 ) (6,543 ) 237 % Provision for income taxes 672 6,064 (5,392 ) (89 %) Loss from continuing operations (9,979 ) (8,828 ) (1,151 ) 13 % Loss from discontinued operations, net of tax (901 ) (47,557 ) 46,656 (98 %) Net loss $ (10,880 ) $ (56,385 ) $ 45,505 (81 %) Revenue We classify our revenue between the Original Equipment Manufacturer (“OEM”) Channel and the Commercial Channel.
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We previously disclosed revenue in three categories: OA Pain Management, Joint Preservation and Restoration and Non-Orthopedic. As a result of a change in strategic focus announced by us in 2024, revenue classification was delineated to provide the investment community a clear view to our value drivers.
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The decrease in revenue was driven by lower pricing with our OEM channel partners, primarily J&J MedTech.
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All other revenue is reported in the Commercial Channel.
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Revenue from our OEM Channel product family decreased 17% for the year ended December 31, 2025, as compared to prior year, due to a $12.6 million decrease in J&J MedTech revenue, primarily due to lower pricing contributing $10.0 million of the decrease and lower volumes contributing to $2.6 million of the decrease.
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Adjusted Gross Profit and Adjusted Gross Margin We define adjusted gross profit as our gross profit excluding certain product rationalization charges. We define adjusted gross margin as adjusted gross profit divided by total revenue.
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There was a $0.8 million decrease in the Non-Orthopedic category revenue with prior year due to lower veterinary sales offset by higher ophthalmic and surgery product sales.
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The following is a reconciliation of adjusted gross profit to gross profit for the years ended December 31, 2024 and 2023, respectively: Years Ended December 31, 2024 2023 Gross profit $ 75,998 $ 82,532 Product rationalization charges 606 748 Adjusted gross profit $ 76,604 $ 83,280 Adjusted gross margin 64 % 69 % Adjusted gross profit for the year ended December 31, 2024 decreased $6.7 million to $76.6 million representing 64% of revenue.
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This sales growth in international OA Pain Management products was primarily related to increased product demand of $3.6 million and minimal change on pricing with international customers.
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Adjusted gross profit for the year ended December 31, 2023 was $83.3 million, or 69% of revenue. The decrease in adjusted gross profit for the year ended December 31, 2024 as compared to 2023, primarily resulted from slower manufacturing production, higher supply chain costs, and a higher proportion of international sales in which product margins are generally lower.
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We also continued our full market release of Integrity in the U.S. in 2025 which contributed to a $3.4 million increase during the year ended December 31, 2025 and we had a $0.8 million increase in Hyalofast which is sold only outside of the United States.
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Adjusted EBITDA We present information below with respect to adjusted EBITDA, which we define as our net loss excluding interest and other income, net, income tax benefit, depreciation and amortization, stock-based compensation, product rationalization charges, and other non-recurring expenses. Adjusted EBITDA is not prepared in accordance with U.S.
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These increases in international OA Pain Management, Hyalofast and Integrity revenues were offset by a $1.5 million decrease in Tactoset sales during 2025.
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The decrease in adjusted net income from continuing operations and adjusted diluted income from continuing operations per share for the period was primarily due to higher manufacturing expenses and research and development costs during the year. 45 Results of Operations Year ended December 31, 2023 compared to year ended December 31, 2022 Statement of Operations Detail Year Ended December 31, 2023 2022 $ Change % Change (in thousands, except percentages) Revenue $ 120,792 $ 113,827 $ 6,965 6 % Cost of revenue 38,260 40,607 (2,347 ) (6 %) Gross profit 82,532 73,220 9,312 13 % Gross margin 68 % 64 % Operating expenses: Research & development 21,763 18,321 3,442 19 % Selling, general & administrative 59,925 51,229 8,696 17 % Total operating expenses 81,688 69,550 12,138 17 % Income (loss) from operations 844 3,670 (2,826 ) (77 %) Interest and other expense, net 2,312 654 1,658 254 % Income before income taxes 3,156 4,324 (1,168 ) (27 %) Provision for income taxes 6,595 2,124 4,471 210 % (Loss) income from continuing operations (3,439 ) 2,200 (5,639 ) (256 %) Loss from discontinued operations (79,228 ) (17,059 ) (62,169 ) 364 % Net loss $ (82,667 ) $ (14,859 ) $ (67,808 ) 456 % Revenue The following table presents revenue by product family for fiscal years 2023 and 2022 (dollars in thousands): Years Ended December 31, 2023 2022 $ Change % Change OEM Channel $ 84,645 $ 81,675 $ 2,970 4 % Commercial Channel 36,147 32,152 3,995 12 % $ 120,792 $ 113,827 $ 6,965 6 % Revenue for the year ended December 31, 2023 was $120.8 million, an increase of $7.0 million, or 6%, compared to the prior year.
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Gross Profit and Margin Gross profit for the year ended December 31, 2025 was $63.8 million, or gross margin of 57%, as compared with $76.0 million, or gross margin of 63%, for the year ended December 31, 2024.
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The increase in revenue was driven by growing global commercial adoption of our OA Pain Management products as well as our introduction of new products in recent years.
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The decrease in gross profit for the year ended December 31, 2025, primarily resulted from lower revenue, primarily related to OA Pain Management products in the U.S., product channel mix with a higher percentage of international sales which have a lower selling price, increased manufacturing costs and higher inventory reserves. 39 Research and Development Research and development costs for the years ended December 31, 2025 and 2024 were as follows: Years Ended December 31, 2025 2024 $ Change % Change (in thousands, except percentages) External costs by program Hyalofast clinical study $ 2,193 $ 1,789 $ 404 23 % Integrity development costs 1,370 943 427 45 % Cingal clinical study 2,998 363 2,635 726 % Regulatory external costs 906 2,728 (1,822 ) (67 %) Other early programs and unallocated expenses 3,631 3,884 (253 ) (7 %) Total external costs 11,098 9,707 1,391 14 % Internal costs: Employee compensation and benefits 12,692 13,779 (1,087 ) (8 %) Facility and other 1,980 2,058 (78 ) (4 %) Total internal costs 14,672 15,837 (1,165 ) (7 %) Total research and development expense $ 25,770 $ 25,544 $ 226 1 % Research and development external costs for the years ended December 31, 2025 and 2024 were $11.1 million and $9.7 million, respectively.
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Revenue from our Commercial Channel product family increased 12% for the year ended December 31, 2023, as compared to prior year, due to international sales growth of our Monovisc single injection pain product and our Cingal next generation non-opioid single injection pain product, as well as favorable ordering patterns from our distributors. 46 Gross Profit and Margin Gross profit for the year ended December 31, 2023 was $82.5 million, or gross margin of 68%, as compared with $73.2 million, or gross margin of 64%, for the year ended December 31, 2022.
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The increase in research and development external costs was primarily due to increased spending on Cingal regulatory submission activities offset by lower regulatory costs related to EU MDR requirements. Research and development internal costs for the years ended December 31, 2025 and 2024 were $14.7 million and $15.8 million, respectively.
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The increase in gross profit for the year ended December 31, 2023, primarily resulted from higher revenue growth, improved manufacturing efficiency and lower product rationalization charges. This increase was partially offset by higher costs due to inflationary pressures for raw materials and freight charges.
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The decrease in internal research and development costs was primarily due to a reduction in headcount and a $0.1 million gain on the sale of an intangible asset during the year ended December 31, 2025. For additional information on our research and development activities, please see the section captioned “Part I. Item 1.

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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 changeUnfavorable fluctuations in exchange rates would have a negative impact on our financial statements. The impact of currency exchange rate fluctuations related to our international subsidiaries on our financial statements were insignificant in 2024. We recognize foreign currency gains or losses arising from our operations in the period incurred. 52
Biggest changeUnfavorable fluctuations in exchange rates would have a negative impact on our financial statements. The impact of currency exchange rate fluctuations related to our international subsidiaries on our financial statements was insignificant in 2025. We recognize foreign currency gains or losses arising from our operations in the period incurred. 48
We also utilize clinical vendors that are located in various countries outside of the United States and invoice us in their local currency and we have one major supplier contract denominated in a foreign currency. We do not engage in foreign currency hedging arrangements for these transactions, and, consequently, foreign currency fluctuations may adversely affect our earnings.
We also utilize clinical vendors that are located in various countries outside of the United States that invoice us in their local currency and we have one major supplier contract denominated in a foreign currency. We do not engage in foreign currency hedging arrangements for these transactions, and, consequently, foreign currency fluctuations may adversely affect our earnings.
Approximately $24.8 million of our revenue was denominated in foreign currencies (primarily the Euro and UK pound sterling) for the year ended December 31, 2024.
Approximately $27.6 million of our revenue was denominated in foreign currencies (primarily the Euro and UK pound sterling) for the year ended December 31, 2025.

Other ANIK 10-K year-over-year comparisons