10q10k10q10k.net

What changed in ARTIVION, INC.'s 10-K — 2024 vs 2025

vs

Paragraph-level year-over-year comparison of ARTIVION, 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.

+265 added−259 removedSource: 10-K (2026-02-18) vs 10-K (2025-02-28)

Top changes in ARTIVION, INC.'s 2025 10-K

265 paragraphs added · 259 removed · 217 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

80 edited+18 added−16 removed199 unchanged
Biggest changeAlternatives to human heart valves processed by us include valve repair and valve replacement with bioprosthetic valves or mechanical valves. We compete with bioprosthetic or mechanical valves from companies including Medtronic, Edwards Lifesciences, Corcym, and Abbott Laboratories. Alternatives to our human cardiac patches include xenograft SIS and glutaraldehyde fixed bovine pericardial patches.
Biggest changeWe compete with bioprosthetic or mechanical valves from companies including Medtronic, Edwards Lifesciences, Corcym, and Abbott Laboratories. Alternatives to our human cardiac patches include xenograft SIS and glutaraldehyde fixed bovine pericardial patches. We compete with these xenograft products from companies including Edwards Lifesciences, Anteris Technologies, Abbott Laboratories, and Baxter. We ship human cardiac tissues to implanting institutions throughout the US.
We have four major product families: aortic stent grafts, surgical sealants, On-X ® mechanical heart valves and related surgical products (“On-X” products), and implantable cardiac and vascular human tissues. Aortic stent grafts include aortic arch stent grafts, abdominal stent grafts, and synthetic vascular grafts.
We have four major product families: aortic stent grafts, On-X ® mechanical heart valves and related surgical products (“On-X” products), surgical sealants, and implantable cardiac and vascular human tissues. Aortic stent grafts include aortic arch stent grafts, abdominal stent grafts, and synthetic vascular grafts.
See Part II, Item 8, Note 16 of the “Notes to Consolidated Financial Statements” for further information on our segments and for our geographic information. Strategy Artivion is committed to partnering with surgeons and cardiologists to deliver innovative technologies of unsurpassed quality that restore the health of patients with aortic disease.
See Part II, Item 8, Note 16 of the “Notes to Consolidated Financial Statements” for further information on our segments and geographic information. Strategy Artivion is committed to partnering with surgeons and cardiologists to deliver innovative technologies of unsurpassed quality that restore the health of patients with aortic disease.
Some states have enacted statutes and regulations governing the preservation, transportation, and storage of human organs and tissues. The activities we engage in require us to be either licensed or registered as a clinical laboratory or tissue bank under California, Delaware, Florida, Georgia, Illinois, Maryland, New York, and Oregon law.
Some states have enacted statutes and regulations governing the preservation, transportation, and storage of human organs and tissues. The activities we engage in require us to be either licensed or registered as a clinical laboratory or tissue bank under California, Delaware, Florida, Illinois, Maryland, New York, and Oregon law.
(“On-X LTI”), an Austin, Texas-based mechanical heart valve company acquired on January 20, 2016, Ascyrus Medical GmbH, a manufacturing entity founded in September 2020, as well as approximately twenty additional country entities to provide sales and marketing support throughout the world.
(“On-X LTI”), an Austin, Texas-based mechanical heart valve company acquired on January 20, 2016, Ascyrus Medical GmbH, a manufacturing entity acquired in September 2020, as well as approximately twenty additional country entities to provide sales and marketing support throughout the world.
We manufacture BioGlue, PhotoFix, and PerClot and process human tissues at this facility. Our On-X facility consists of combined manufacturing, warehouse, and office space in Austin, Texas, where our On-X products, including On-X heart valves and AAPs, are manufactured. Our aortic stent graft facility consists of combined manufacturing, warehousing, and office space in Hechingen, Germany and is our EMEA headquarters.
We manufacture BioGlue, PhotoFix, and PerClot and process human tissues at this facility. Our On-X facility consists of combined manufacturing, warehouse, and office space in Austin, Texas, where our On-X products, including On-X heart valves and AAPs, are manufactured. Our aortic stent graft facility consists of combined manufacturing, warehousing, and office space in Hechingen, Germany and in our EMEA headquarters.
Abdominal stent grafts include our E-xtra Design Engineering (including Artivex TM ), E-nside TM , E-tegra TM , E-ventus TM BX, Tuva™ BX, and E-liac TM products. Surgical sealants include our BioGlue ® Surgical Adhesive products (“BioGlue”).
Abdominal stent grafts include our E-xtra Design Engineering, E-nside TM , Artivex TM , E-tegra TM , E-ventus TM BX, Tuva TM BX, and E-liac TM products. Surgical sealants include BioGlue ® Surgical Adhesive (“BioGlue”) products.
We hold FDA 510(k) clearance and previously held a CE Mark for PhotoFix which is indicated for use in intracardiac repair, great vessel repair, suture line buttressing, pericardial closure, and vascular repair and reconstruction (for example: the carotid, iliac, femoral, and tibial blood vessels as well as arteriovenous access revisions).
We hold FDA 510(k) clearance and a CE Mark for PhotoFix which is indicated for use in intracardiac repair, great vessel repair, suture line buttressing, pericardial closure, and vascular repair and reconstruction (for example: the carotid, iliac, femoral, and tibial blood vessels as well as arteriovenous access revisions).
Tissue is stored by us until it is shipped to a hospital, where the tissue is thawed and implanted immediately or held in a liquid nitrogen freezer pending implantation. Backlog As of December 31, 2024 we did not have a significant backlog of orders related to our medical devices.
Tissue is stored by us until it is shipped to a hospital, where the tissue is thawed and implanted immediately or held in a liquid nitrogen freezer pending implantation. Backlog As of December 31, 2025 we did not have a significant backlog of orders related to our medical devices.
The addition of the NEXUS family of products to our highly differentiated aortic stent graft portfolio further strengthens our position as a leader in the aortic repair market. 10 Table of Contents Several other manufacturers are introducing competitive products through the custom-made device process in Europe and the early feasibility process within the US, including Cook, Gore, and Terumo.
The addition of the NEXUS family of products to our highly differentiated aortic stent graft portfolio further strengthens our position as a leader in the aortic repair market. Several other manufacturers are introducing competitive products through the custom-made device process in Europe and the early feasibility process within the US, including Cook, Gore, and Terumo.
Due to supply-related factors outside of our control, we abandoned the business as of June 2023. PerClot PerClot is an absorbable powdered hemostat, consisting of plant starch modified into ultra-hydrophilic, adhesive-forming hemostatic polymers. PerClot granules are biocompatible, absorbable polysaccharides containing no animal or human components.
Due to supply-related factors outside of our control, we abandoned the business as of June 2023. 15 Table of Contents PerClot PerClot is an absorbable powdered hemostat, consisting of plant starch modified into ultra-hydrophilic, adhesive-forming hemostatic polymers. PerClot granules are biocompatible, absorbable polysaccharides containing no animal or human components.
We also make available on the Corporate Governance portion of our website: (i) our Code of Conduct; (ii) our Corporate Governance Guidelines; (iii) the charter of each active committee of our Board of Directors; (iv) our Code of Ethics for Senior Financial Officers; (v) our Corporate Responsibility Report (ESG); and (vi) our Foreign Corrupt Practices Act (“FCPA”) Policy.
We also make available on the Corporate Governance portion of our website: (i) our Code of Conduct; (ii) our Corporate Governance Guidelines; (iii) the charter of each active committee of our Board of Directors; (iv) our Code of Ethics for Senior Financial Officers; (v) our Corporate Responsibility Report (ESG); (vi) our Foreign Corrupt Practices Act (“FCPA”) Policy; and (vii) our Insider Trading Policy.
We obtained a CE Mark for E-vita Open NEO in the first quarter of 2020 and began full product launch in the fourth quarter of 2020. E-vita Open NEO is a hybrid stent graft system used in the treatment of patients with either an aneurysm or dissection in the aortic arch and in the descending thoracic aorta.
We obtained a CE Mark for E-vita Open NEO in the first quarter of 2020 and began full product launch in the fourth quarter of 2020. 9 Table of Contents E-vita Open NEO is a hybrid stent graft system used in the treatment of patients with either an aneurysm or dissection in the aortic arch and in the descending thoracic aorta.
See also Part I, Item 2, “Properties.” In all of our facilities, we are subject to regulatory standards for good manufacturing practices, including current Quality System Regulations, which are the FDA regulatory requirements for medical device manufacturers, and current Good Tissue Practices (“cGTPs”), which are the FDA regulatory requirements for the processing of human tissue.
See also Part I, Item 2, “Properties.” 17 Table of Contents In all of our facilities, we are subject to regulatory standards for good manufacturing practices, including current Quality System Regulations, which are the FDA regulatory requirements for medical device manufacturers, and current Good Tissue Practices (“cGTPs”), which are the FDA regulatory requirements for the processing of human tissue.
We obtained marketing approvals in addition to the CE Mark for the E-vita Open NEO in other countries throughout the world. The E-vita Open NEO competes outside the US with products from Terumo Medical Corporation (“Terumo”, formerly Vascutek) and two smaller companies. We do not currently sell E-vita Open NEO in the US.
We obtained marketing approvals in addition to the CE Mark for the E-vita Open NEO in other countries throughout the world. The E-vita Open NEO competes outside the United States (“US”) with products from Terumo Medical Corporation (“Terumo”, formerly Vascutek) and two smaller companies. We do not currently sell E-vita Open NEO in the US.
Some of these competitors might have greater experience in developing products, procuring tissues, conducting clinical trials, and obtaining regulatory approvals, and they might have large contracts with hospitals under which they can obtain purchase requirements that place our products at a disadvantage.
Some of these competitors might have greater experience in developing products, procuring tissues, conducting clinical trials, and obtaining regulatory approvals, and they might have contracts with large hospital groups under which they can obtain purchase requirements that place our products at a disadvantage.
Human tissue is not as susceptible to infection as synthetic alternatives and more closely simulates the performance of the patient’s own tissue and vasculature compared to non-human tissue alternatives. 14 Table of Contents Two other domestic human tissue processors, LifeNet and LeMaitre, offer preserved vascular tissue in competition with us.
Human tissue is not as susceptible to infection as synthetic alternatives and more closely simulates the performance of the patient’s own tissue and vasculature compared to non-human tissue alternatives. Two other domestic human tissue processors, LifeNet and LeMaitre, offer preserved vascular tissue in competition with us.
Seasonality See Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Seasonality,” regarding seasonality of our products and services. Human Capital Overview As of December 31, 2024 we had approximately 1,600 employees. Most of our employees are located in Kennesaw, Georgia; Austin, Texas; and Hechingen, Germany.
Seasonality See Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Seasonality,” regarding seasonality of our products and services. Human Capital Overview As of December 31, 2025 we had approximately 1,800 employees. Most of our employees are located in Kennesaw, Georgia; Austin, Texas; and Hechingen, Germany.
The On-X AAP is an On-X aortic valve combined with a synthetic vascular graft to allow physicians to more conveniently treat patients requiring both an aortic valve replacement and replacement of a portion of the ascending aorta with an aortic graft.
The On-X AAP is an On-X aortic valve combined with a synthetic Valsalva graft conduit to allow physicians to more conveniently treat patients requiring both an aortic valve replacement and replacement of a portion of the ascending aorta with an aortic graft.
Aortic arch stent grafts include our E-vita ® Open NEO, E-vita Open Plus, the Ascyrus Medical Dissection Stent (“AMDS”) hybrid prosthesis, the NEXUS ONE TM (“NEXUS ONE”), NEXUS DUO TM (“NEXUS DUO”), and NEXUS TRE TM (“NEXUS TRE”) aortic arch stent graft systems (the “NEXUS family of products”), and E-vita Thoracic 3G products.
Aortic arch stent grafts include our E-vita ® Open NEO, E-vita Open Plus, Arcevo™ LSA Hybrid Stent Graft System (“Arcevo LSA”), the Ascyrus Medical Dissection Stent (“AMDS”) hybrid prosthesis, the NEXUS ONE TM (“NEXUS ONE”), NEXUS DUO TM (“NEXUS DUO”), and NEXUS TRE TM (“NEXUS TRE”) aortic arch stent graft systems (the “NEXUS family of products”), and E-vita Thoracic 3G products.
NEXUS Products We distribute the NEXUS family of products in certain countries in Europe under an exclusive distribution agreement with Endospan Ltd. (“Endospan”), an Israeli corporation.
NEXUS Products We distribute the NEXUS family of products in certain countries in EMEA and APAC under an exclusive distribution agreement with Endospan Ltd. (“Endospan”), an Israeli corporation.
We believe the addition of E-nside positions us well to capture share in the European aortic stent graft market because E-xtra Design Engineering provides patient-specific solutions, and E-nside provides an off-the-shelf solution. 11 Table of Contents Further, there are synergies between E-nside and our portfolio of thoracic and abdominal stent grafts. E-nside competes with products from Cook.
We believe the addition of E-nside positions us well to capture share in the European aortic stent graft market because E-xtra Design Engineering provides patient-specific solutions, and E-nside provides an off-the-shelf solution. Further, there are synergies between E-nside and our portfolio of thoracic and abdominal stent grafts.
We received regulatory approval from the National Medical Products Administration (“NMPA”) to commercialize BioGlue in China during the third quarter of fiscal year 2024. We currently expect to commercialize BioGlue in China during the second half of 2025.
We received regulatory approval from the National Medical Products Administration (“NMPA”) to commercialize BioGlue in China during the third quarter of fiscal year 2024. We began to commercialize BioGlue in China during the first half of 2025.
The E-vita Open NEO competes in Europe primarily on its proven stent graft technology and long-term clinical data. The CE Mark for the E-vita Open Plus expired in 2022 and is only sold in limited countries including Brazil. AMDS TM We acquired Ascyrus in September 2020.
The E-vita Open NEO competes in Europe primarily on its proven stent graft technology and long-term clinical data. The CE Mark for the E-vita Open Plus expired in 2022 and is only sold in limited countries including Brazil.
The E-vita Thoracic 3G is sometimes used in conjunction with the E-vita Open NEO and E-xtra Design Engineering. Until 2022 we held a CE Mark for the E-vita Thoracic 3G and additional marketing approvals have been granted in several other countries throughout the world. The E-vita Thoracic 3G competes primarily with products from Medtronic, Gore, Terumo, and Cook.
The E-vita Thoracic 3G is sometimes used in conjunction with the E-vita Open NEO and E-xtra Design Engineering. Until 2022 we held a CE Mark for the E-vita Thoracic 3G and additional marketing approvals have been granted in several other countries throughout the world.
In 2024, 2023 and 2022 we spent approximately $28.5 million, $28.7 million and $38.9 million, respectively, on research and development activities on new and existing products. These amounts accounted for approximately 7%, 8% and 12% of our revenues for each of 2024, 2023 and 2022, respectively.
In 2025, 2024, and 2023 we spent approximately $31.0 million, $28.5 million, and $28.7 million, respectively, on research and development activities on new and existing products. These amounts accounted for approximately 7%, 7%, and 8% of our revenues for each of 2025, 2024, and 2023, respectively.
The Breakthrough Device Designation program is designed to provide timely access to medical devices that potentially provide a more effective treatment for life-threatening conditions by prioritizing review of its regulatory submissions, thereby expediting the device development process.
The FDA granted Breakthrough Device Designation in the third quarter of 2019 for the AMDS hybrid prosthesis. The Breakthrough Device Designation program is designed to provide timely access to medical devices that potentially provide a more effective treatment for life-threatening conditions by prioritizing review of its regulatory submissions, thereby expediting the device development process.
In addition, if these materials or supplies, or changes to them, do not receive regulatory approval or are recalled, if the related suppliers and/or their facilities are shut down temporarily or permanently, for any reason, or if the related suppliers are otherwise unable or unwilling to supply us, we may not have sufficient materials or supplies to manufacture our products or process tissues.
In these cases, we may have to immediately scrap raw or in-process materials and expense the costs of manufacturing or preservation. 16 Table of Contents In addition, if these materials or supplies, or changes to them, do not receive regulatory approval or are recalled, if the related suppliers and/or their facilities are shut down temporarily or permanently, for any reason, or if the related suppliers are otherwise unable or unwilling to supply us, we may not have sufficient materials or supplies to manufacture our products or process tissues.
The E-liac competes with products from Gore and Cook. Synthetic Vascular Grafts In addition to our endovascular stent graft offerings, we have a broad line of synthetic vascular grafts that are used in open aortic and peripheral vascular surgical procedures. Our offerings include ePTFE grafts and both woven and knitted polyester grafts.
Synthetic Vascular Grafts In addition to our endovascular stent graft offerings, we have a broad line of synthetic vascular grafts that are used in open aortic and peripheral vascular surgical procedures. Our offerings include ePTFE grafts and both woven and knitted polyester grafts.
We are currently transitioning our PhotoFix CE Mark to our new Notified Body, DEKRA. See Part I, Item 1A, “Risk Factors—Legal, Quality, and Regulatory Risks—Our products and tissues are highly regulated and subject to significant quality and regulatory risks,” for a discussion of the risks related to our PhotoFix CE Mark.
The PhotoFix CE Mark has been successfully transferred to our new Notified Body, DEKRA, as of the fourth quarter of 2025. See Part I, Item 1A, “Risk Factors—Legal, Quality, and Regulatory Risks—Our products and tissues are highly regulated and subject to significant quality and regulatory risks,” for a discussion of the risks related to our PhotoFix CE Mark.
The E-liac is a self-expanding stent graft characterized by easy and safe handling, which makes it possible to safely reach the lesion and accurately position the stent graft in the vessel.
E-liac The E-liac is a stent graft used to treat aneurysmal iliac arteries as well as aneurysmal iliac side branches. The E-liac is a self-expanding stent graft characterized by easy and safe handling, which makes it possible to safely reach the lesion and accurately position the stent graft in the vessel.
At the FDA’s request, we are conducting a post-approval study to collect long-term clinical data for the On-X aortic heart valve managed with reduced warfarin therapy. This study is ongoing and data collection is expected to continue through 2027. The FDA granted Breakthrough Device Designation in the third quarter of 2019 for the AMDS hybrid prosthesis.
At the FDA’s request, we are conducting a post-approval study to collect long-term clinical data for the On-X aortic heart valve managed with reduced warfarin therapy. This study is ongoing and data collection is expected to continue through 2027 to fulfill the FDA requirement.
Commercialization of the device may begin when the FDA approves the PMA. 18 Table of Contents The FDCA requires all medical device manufacturers and distributors to register with the FDA annually and to provide the FDA with a list of those medical devices they distribute commercially.
The FDCA requires all medical device manufacturers and distributors to register with the FDA annually and to provide the FDA with a list of those medical devices they distribute commercially.
Industry and the clinician community are currently working with CBER and other federal agencies and stakeholders to rescind implementation of the Guidances or to reissue them. 19 Table of Contents NOTA Regulation Our activities in preserving and transporting human hearts and certain other organs are also subject to federal regulation under the National Organ Transplant Act (“NOTA”), which makes it unlawful for any person to knowingly acquire, receive, or otherwise transfer any human organ for valuable consideration for use in human transplantation if the transfer affects interstate commerce.
NOTA Regulation Our activities in preserving and transporting human hearts and certain other organs are also subject to federal regulation under the National Organ Transplant Act (“NOTA”), which makes it unlawful for any person to knowingly acquire, receive, or otherwise transfer any human organ for valuable consideration for use in human transplantation if the transfer affects interstate commerce.
The Tuva BX is often used in conjunction with E-xtra Design Engineering products, E-nside stent grafts, and E-liac stent grafts. The Tuva BX is manufactured by LVD Biotech SL, who hold a CE Mark for that product and additional marketing approvals in several other countries throughout the world.
The E-ventus BX is often used in conjunction with E-xtra Design Engineering products, E-nside stent grafts, and the E-liac stent graft. 12 Table of Contents The E-ventus BX was manufactured by Bentley, who holds a CE Mark for that product and additional marketing approvals in several other countries throughout the world.
The E-nside’s pre-cannulated inner branches are designed to reduce the overall procedure time which reduces the patient’s exposure to radiation. The vast majority of patients with thoraco-abdominal disease are treated with risky, invasive open surgical procedures, characterized by lengthy hospitalization periods and prolonged recuperation, or with custom-made stent grafts which can take up to 90 days to manufacture.
The vast majority of patients with thoraco-abdominal disease are treated with risky, invasive open surgical procedures, characterized by lengthy hospitalization periods and prolonged recuperation, or with custom-made stent grafts which can take up to 90 days to manufacture.
Raw materials, solutions, and other components utilized in our manufacturing and tissue processing operations as well as certain subassemblies and finished goods manufactured by third parties are received and inspected by trained quality control personnel according to written specifications and standard operating procedures. Those items found to comply with our standards are utilized in our operations.
We employ a comprehensive quality assurance program in our product manufacturing and tissue preservation activities. Raw materials, solutions, and other components utilized in our manufacturing and tissue processing operations as well as certain subassemblies and finished goods manufactured by third parties are received and inspected by trained quality control personnel according to written specifications and standard operating procedures.
(“SMI”), which allowed us to distribute PerClot, worldwide, except a few countries. In July 2021 we entered into an asset purchase agreement and other ancillary agreements related to the sale of PerClot to a subsidiary of Baxter and an agreement to terminate all of our material agreements with SMI related to PerClot (collectively the “Baxter Transaction”).
In July 2021 we entered into an asset purchase agreement, Transitional Manufacturing and Supply Agreement (“TMSA”), and other ancillary agreements related to the sale of PerClot, to a subsidiary of Baxter and an agreement to terminate all of our material agreements with SMI related to PerClot (collectively the “Baxter Transaction”).
Raw materials, solution, components, subassemblies, and tissues are documented throughout manufacturing or processing to ensure traceability. 17 Table of Contents We evaluate and inspect both our manufactured and distributed products to ensure conformity to product specifications. Processes are validated to review whether products manufactured meet our specifications.
Those items found to comply with our standards are utilized in our operations. Raw materials, solution, components, subassemblies, and tissues are documented throughout manufacturing or processing to ensure traceability. We evaluate and inspect both our manufactured and distributed products to ensure conformity to product specifications. Processes are validated to review whether products manufactured meet our specifications.
See Part I, Item 1A, “Risk Factors” below for a discussion of these and other risk factors.
Risk Factors Our business is subject to a number of risks. See Part I, Item 1A, “Risk Factors” below for a discussion of these and other risk factors.
The governing German competent authority, the Regierungspräsidium Tübingen, granted us an extended grace period until December 31, 2021 to transfer LRQA-issued certifications for BioGlue and PhotoFix to a new Notified Body.
The governing German competent authority, the Regierungspräsidium Tübingen, granted us an extended grace period until December 31, 2021 to transfer LRQA-issued certifications for BioGlue and PhotoFix to a new Notified Body. Both BioGlue and PhotoFix CE Marks have been successfully transferred to our new Notified Body, DEKRA, as of the fourth quarter of 2025.
We also operate according to International Organization for Standardization (“ISO”) 13485 Quality System Requirements, an internationally recognized voluntary system of quality management for companies that design, develop, manufacture, distribute, and service medical devices. We maintain a Certification of Approval to ISO 13485. We employ a comprehensive quality assurance program in our product manufacturing and tissue preservation activities.
In addition, with the exception of the processing of human tissue, we operate according to International Organization for Standardization (“ISO”) 13485 Quality System Requirements, an internationally recognized voluntary system of quality management for companies that design, develop, manufacture, distribute, and service medical devices. We maintain a Certification of Approval to ISO 13485.
Our cardiac tissues are used in a variety of valve replacement and cardiac reconstruction surgeries. We believe the human tissues we distribute offer specific clinical advantages over mechanical, synthetic, and bioprosthetic alternatives.
These tissues more closely resemble in structure, and simulate the performance of, the patient’s own tissue compared to non-human tissue alternatives. Our cardiac tissues are used in a variety of valve replacement and cardiac reconstruction surgeries. We believe the human tissues we distribute offer specific clinical advantages over mechanical, synthetic, and bioprosthetic alternatives.
Endospan completed patient enrollment in their US pivotal trial, TRIOMPHE in the fourth quarter of 2024. E-vita Thoracic 3G The E-vita Thoracic 3G is a stent graft system that enables endovascular treatment of TAAs.
Endospan completed patient enrollment in their US pivotal trial, TRIOMPHE, in the fourth quarter of 2024 and completed the one-year clinical follow-up in the fourth quarter of 2025. Endospan anticipates receiving PMA approval for NEXUS ONE in 2026. E-vita Thoracic 3G The E-vita Thoracic 3G is a stent graft system that enables endovascular treatment of TAAs.
We estimate that 20% of patients who have an AAA also have an aneurysmal iliac artery, and as such, the E-liac is often used in conjunction with the E-tegra AAA device as well as one or two E-ventus BX devices. 12 Table of Contents We hold a CE Mark for the E-liac and additional marketing approvals have been granted in several other countries throughout the world.
We estimate that 20% of patients who have an AAA also have an aneurysmal iliac artery, and as such, the E-liac is often used in conjunction with the E-tegra AAA device as well as one or two E-ventus BX devices.
FDA regulations require approval through the IDE/PMA process for all Class III medical devices and for medical devices not deemed substantially equivalent to a predicate device. An IDE authorizes distribution of devices that lack PMA or 510(k) clearance for clinical evaluation purposes. After a product is subjected to clinical testing under an IDE, we may file a PMA application.
Commercialization may commence when the FDA issues a clearance letter finding such substantial equivalence. 18 Table of Contents FDA regulations require approval through the IDE/PMA process for all Class III medical devices and for medical devices not deemed substantially equivalent to a predicate device. An IDE authorizes distribution of devices that lack PMA or 510(k) clearance for clinical evaluation purposes.
Furthermore, this was confirmed by the five-year outcomes from this cohort that determined in a real-world setting, the On-X aortic heart valve managed at a low INR of 1.5-2.0 (after 3 months of standard therapy) demonstrated an 87% reduction in major bleeding with no increase in thromboembolic events and no valve thrombosis when compared to standard INR of 2.0-3.0.
Recent real-world data presented at the 2024 AATS showed five-year outcomes for 229 On-X aortic heart valve patients managed at a low INR of 1.5-2.0 (after 3 months standard therapy) reduces risk of major bleeding by 87% with no increase in thromboembolic events and no valve thrombosis when compared to standard INR of 2.0-3.0.
We believe that this reduced risk may provide a competitive advantage for CryoValve SGPV and CryoPatch SG for patients who later need a whole organ transplant, because an increased PRA can decrease the number of possible donors for subsequent organ transplants and increase time on transplant waiting lists.
We believe that this reduced risk may provide a competitive advantage for CryoValve SGPV and CryoPatch SG for patients who later need a whole organ transplant, because an increased PRA can decrease the number of possible donors for subsequent organ transplants and increase time on transplant waiting lists. 14 Table of Contents Two other domestic tissue processors, LifeNet Health (“LifeNet”) and LeMaitre Vascular (“LeMaitre”), offer preserved human heart valves and patches in competition with us.
In some cases, the submission must include data from clinical studies in order to demonstrate substantial equivalency to a predicate device. Commercialization may commence when the FDA issues a clearance letter finding such substantial equivalence.
In some cases, the submission must include data from clinical studies in order to demonstrate substantial equivalency to a predicate device.
BioGlue syringes are available in pre-filled 2ml, 5ml, and 10ml volumes with applicator tips suitable for various applications. BioGlue is FDA approved as an adjunct to sutures and staples for use in adult patients in open surgical repair of large vessels. We distribute BioGlue under CE Mark for repair of soft tissues (which include cardiac, vascular, and pulmonary).
BioGlue is dispensed through a controlled delivery system that consists of a disposable syringe and various applicator tips. BioGlue syringes are available in pre-filled 2ml, 5ml, and 10ml volumes with applicator tips suitable for various applications. BioGlue is FDA approved as an adjunct to sutures and staples for use in adult patients in open surgical repair of large vessels.
Employee Engagement We solicit employee feedback to assess employee satisfaction and engagement and to identify opportunities for development. Employee feedback is also gathered through onboarding surveys, the employee review process, spot surveys, and exit surveys. Risk Factors Our business is subject to a number of risks.
We continually strive to look for opportunities to provide a safer, healthier, work environment for our employees. Employee Engagement We solicit employee feedback to assess employee satisfaction and engagement and to identify opportunities for development. Employee feedback is also gathered through onboarding surveys, the employee review process, spot surveys, and exit surveys.
In December 2023 we launched Artivex as part of our E-xtra Design Engineering stent graft systems in EMEA. Artivex is indicated for use in both thoraco-abdominal aneurysms and dissections extending into the thoraco-abdominal aorta. We sell custom TAAA and Artivex in EMEA and in a limited number of other countries around the world.
Our custom TAAA is often used in conjunction with E-vita Thoracic 3G, as well as the AAA offering, the E-tegra, or in combination with both. In December 2023 we launched Artivex as part of our E-xtra Design Engineering stent graft systems in EMEA. Artivex is indicated for use in both thoraco-abdominal aneurysms and dissections extending into the thoraco-abdominal aorta.
Once a PMA application has been submitted, the FDA’s review may be lengthy and may include requests for additional data, which may require us to undertake additional human clinical studies.
After a product is subjected to clinical testing under an IDE, we may file a PMA application. Once a PMA application has been submitted, the FDA’s review may be lengthy and may include requests for additional data, which may require us to undertake additional human clinical studies. Commercialization of the device may begin when the FDA approves the PMA.
Our ability to fully recover all possible losses from these suppliers and contract manufacturers may have practical limitations imposed by factors like industry standard contractual terms or the financial resources of the adverse party. 16 Table of Contents Some of the materials, supplies, and services used in our product manufacturing and tissue processing, as well as some of our products, are sourced from single- or sole-source suppliers.
Our ability to fully recover all possible losses from these suppliers and contract manufacturers may have practical limitations imposed by factors like industry standard contractual terms or the financial resources of the adverse party.
Aortic Stent Graft s Hybrid stent grafts, surgical grafts, and endovascular stent grafts can be used in the treatment of complex thoracic and abdominal aortic disease, such as aortic dissections and aortic aneurysms, as well as in other aortic and peripheral procedures. 9 Table of Contents Thoracic Stents and Stent Grafts E-vita Open NEO The E-vita Open NEO is the next generation of the E-vita Open Plus hybrid stent graft, with an updated delivery system and improved handling.
Aortic Stent Graft s Hybrid stent grafts, surgical grafts, and endovascular stent grafts can be used in the treatment of complex thoracic and abdominal aortic disease, such as aortic dissections and aortic aneurysms, as well as in other aortic and peripheral procedures.
Thoraco-abdominal Stents and Stent Grafts E-xtra Design Engineering E-xtra Design Engineering is a comprehensive range of stent graft systems for the treatment of aortic vascular diseases that enables surgeons to quickly and efficiently respond to an individual patient’s therapeutic requirements. E-xtra Design Engineering stent graft systems are tailor-made for individual patients based on imaging of the patient’s own aorta.
The E-vita Thoracic 3G competes primarily with products from Medtronic, Gore, Terumo, and Cook. 11 Table of Contents Thoraco-abdominal Stents and Stent Grafts E-xtra Design Engineering E-xtra Design Engineering is a comprehensive range of stent graft systems for the treatment of aortic vascular diseases that enables surgeons to quickly and efficiently respond to an individual patient’s therapeutic requirements.
Such programs include leadership development, office safety, ethics, and various skill-based training programs. Health and Safety Protecting the health, safety, and well-being of our employees around the world is a priority. We continually strive to look for opportunities to provide a safer, healthier, work environment for our employees.
The Company strives to provide equal opportunity to all applicants and employees. 23 Table of Contents Training and Development We provide internal training and development programs to employees globally. Such programs include leadership development, office safety, ethics, and various skill-based training programs. Health and Safety Protecting the health, safety, and well-being of our employees around the world is a priority.
We also distribute BioGlue in Japan where it is approved for adhesion and support of hemostasis for aortotomy closure sites, suture/anastomosis sites (including aortic dissection and anastomosis sites with use of a prosthetic graft), and suture sites on the heart. Additional marketing approvals have been granted for specified applications in numerous other countries throughout the world.
We distribute BioGlue under CE Mark for repair of soft tissues (which include cardiac, vascular, and pulmonary). We also distribute BioGlue in Japan where it is approved for adhesion and support of hemostasis for aortotomy closure sites, suture/anastomosis sites (including aortic dissection and anastomosis sites with use of a prosthetic graft), and suture sites on the heart.
We believe the human tissues we distribute offer specific advantages over synthetic and bioprosthesis alternatives, particularly for the treatment of infection in hemodialysis and peripheral bypass patients.
Our vascular tissues are used to treat a variety of vascular reconstructions, such as peripheral bypass, hemodialysis access, and aortic infections, which have saved the lives and limbs of patients. We believe the human tissues we distribute offer specific advantages over synthetic and bioprosthesis alternatives, particularly for the treatment of infection in hemodialysis and peripheral bypass patients.
The Tuva BX stent is designed for different artery diameters by adapting its open cell design with alternating connection bridges. The device also has enhanced visibility due to three radiopaque markers at each stent end that facilitate accurate placement in implantation and post-dilation.
The device also has enhanced visibility due to three radiopaque markers at each stent end that facilitate accurate placement in implantation and post-dilation. The Tuva BX is often used in conjunction with E-xtra Design Engineering products, E-nside stent grafts, and E-liac stent grafts.
The E-ventus BX was manufactured by Bentley, who holds a CE Mark for that product and additional marketing approvals in several other countries throughout the world. The E-ventus BX competes with products from Maquet, Gore, BD, and Bentley InnoMed. We received the final production lots of E-ventus BX in May 2023 and we substantially depleted the remaining inventory during 2024.
The Tuva BX is manufactured by LVD Biotech SL, who hold a CE Mark for that product and additional marketing approvals in several other countries throughout the world. The Tuva BX competes with products from Maquet, Gore, BD, and Bentley InnoMed.
We believe that our patents, trade secrets, trademarks, and licensing rights provide us with important competitive advantages. We currently own rights to numerous US and foreign patents and pending patent applications relating to our technology for various product lines. There can be no assurance that any pending applications will ultimately be issued as patents.
We currently own rights to numerous US and foreign patents and pending patent applications relating to our technology for various product lines. There can be no assurance that any pending applications will ultimately be issued as patents. We have also obtained rights through license and distribution agreements for additional products and technologies, including the NEXUS family of products.
Corporate Structure Our main operating subsidiaries include JOTEC GmbH (“JOTEC”), a Hechingen, Germany-based endovascular and surgical products company acquired on December 1, 2017, On-X Life Technologies, Inc.
We began to manufacture and supply PerClot ® hemostatic powder (“PerClot”) during the second quarter of 2023 (as part of the Transitional Manufacturing and Supply Agreement (“TMSA”) of the Baxter Transaction). Corporate Structure Our main operating subsidiaries include JOTEC GmbH (“JOTEC”), a Hechingen, Germany-based endovascular and surgical products company acquired on December 1, 2017, On-X Life Technologies, Inc.
There are currently only limited off-the-shelf products to treat aneurysms in the thoraco-abdominal aorta due to the many side branches in this anatomy where blood flow to vital organs would be obstructed by unbranched stent grafts. We have pioneered a service whereby we can manufacture a customized thoraco-abdominal stent graft in approximately 22 working days.
E-xtra Design Engineering stent graft systems are tailor-made for individual patients based on imaging of the patient’s own aorta. There are currently only limited off-the-shelf products to treat aneurysms in the thoraco-abdominal aorta due to the many side branches in this anatomy where blood flow to vital organs would be obstructed by unbranched stent grafts.
Recently, the Center for Biologics Evaluation and Research (“CBER”) of the FDA issued two “final” guidance documents directed at the reduction of the risk of transmission of tuberculousis (Mtb) in processed human tissue (the “Guidances”), which is already exceedingly low.
The FDA periodically audits our tissue preservation facilities for compliance with its requirements and has the authority to enjoin the distribution, force a recall, or require the destruction of tissues that do not meet its requirements. 19 Table of Contents Recently, the Center for Biologics Evaluation and Research (“CBER”) of the FDA issued two “final” guidance documents directed at the reduction of the risk of transmission of tuberculousis (Mtb) in processed human tissue (the “Guidances”), which is already exceedingly low.
Two other domestic tissue processors, LifeNet Health (“LifeNet”) and LeMaitre Vascular (“LeMaitre”), offer preserved human heart valves and patches in competition with us. We believe that we compete favorably on the basis of surgeon preference, documented clinical data, technology, and customer service, particularly with respect to the capabilities of our field representatives.
We believe that we compete favorably on the basis of surgeon preference, documented clinical data, technology, and customer service, particularly with respect to the capabilities of our field representatives. Alternatives to human heart valves processed by us include valve repair and valve replacement with bioprosthetic valves or mechanical valves.
BioGlue begins to polymerize within 20 to 30 seconds, reaches its bonding strength within two minutes, and it adheres to tissues in a wet field. BioGlue is dispensed through a controlled delivery system that consists of a disposable syringe and various applicator tips.
BioGlue is stronger than other cardiovascular sealants with a tensile strength that is four to five times that of fibrin sealants. BioGlue begins to polymerize within 20 to 30 seconds, reaches its bonding strength within two minutes, and it adheres to tissues in a wet field.
We believe that the use of surgical adhesives and sealants, with or without sutures and staples, in certain areas can enhance the efficacy of these procedures through more effective and rapid wound closure.
We believe that the use of surgical adhesives and sealants, with or without sutures and staples, in certain areas can enhance the efficacy of these procedures through more effective and rapid wound closure. 13 Table of Contents Our proprietary BioGlue is a polymer consisting of bovine blood protein and an agent for cross-linking proteins, which was developed for use in cardiac, vascular, neurologic, and pulmonary procedures.
Under the terms of the Baxter Transaction, we will continue to provide to Baxter certain transition, manufacturing, and supply services relating to the sale of SMI PerClot outside of the US and manufacture and supply of PerClot to Baxter in the US.
Under the terms of the Baxter Transaction, we provided to Baxter certain transition services relating to the sale of SMI PerClot outside of the US. In May 2023 we obtained FDA PMA approval to commercialize PerClot in the US, which we transferred to Baxter, and began manufacturing and supplying PerClot for Baxter under the terms of the TMSA.
The FDA granted Breakthrough Device Designation in the third quarter of 2019 for the E-nside and E-xtra Design Multibranch TAAA devices . Patents, Licenses, and Other Proprietary Rights We rely on a combination of patents, trademarks, confidentiality agreements, and security procedures to protect our proprietary products, preservation technology, trade secrets, and know-how.
Patents, Licenses, and Other Proprietary Rights We rely on a combination of patents, trademarks, confidentiality agreements, and security procedures to protect our proprietary products, preservation technology, trade secrets, and know-how. We believe that our patents, trade secrets, trademarks, and licensing rights provide us with important competitive advantages.
We sell BioGlue throughout the world including North America, EMEA, APAC, and LATAM. 13 Table of Contents Preservation Services Cardiac Preservation Services Our proprietary preservation process involves our dissection, processing, preservation, and storage of donated human tissues until they are shipped to a hospital where they are implanted by physicians.
Preservation Services Cardiac Preservation Services Our proprietary preservation process involves our dissection, processing, preservation, and storage of donated human tissues until they are shipped to a hospital where they are implanted by physicians. The cardiac tissues we currently preserve include aortic and pulmonary heart valves and cardiac patches in three primary pulmonary anatomic configurations: hemi-artery, trunk, and branch.
Tuva™ BX Tuva BX is a balloon-expandable peripheral stent graft indicated for the endovascular treatment of arterial ruptures, aneurysms and other peripheral vascular system pathologies. The Tuva BX stents are manufactured using a cobalt chromium alloy which is covered internally and externally with ePTFE so that the stent is completely encapsulated.
The Tuva BX stents are manufactured using a cobalt chromium alloy which is covered internally and externally with ePTFE so that the stent is completely encapsulated. The Tuva BX stent is designed for different artery diameters by adapting its open cell design with alternating connection bridges.
Radiopaque markers on the delivery system enable secure and accurate positioning of the stent graft. The E-ventus BX is often used in conjunction with E-xtra Design Engineering products, E-nside stent grafts, and the E-liac stent graft.
Radiopaque markers on the delivery system enable secure and accurate positioning of the stent graft.
Vascular Preservation Services Our proprietary preservation process involves our dissection, processing, preservation, and storage of donated human tissues until they are shipped to a hospital for implantation by a physician. The vascular tissues currently preserved by us include saphenous veins, aortoiliac arteries, and femoral veins and arteries.
Our CryoValve SGPV and CryoPatch SG are distributed under 510(k) clearance from the FDA. We also ship limited tissues in Canada and other countries under special access programs. Vascular Preservation Services Our proprietary preservation process involves our dissection, processing, preservation, and storage of donated human tissues until they are shipped to a hospital for implantation by a physician.
TAAA competes with customized product offerings from Cook and Terumo. Artivex competes with other thoracic extension products marketed by Medtronic, Gore, Terumo, and Cook . E-nside TM The E-nside TAAA multibranch stent graft system is an off-the-shelf stent graft with pre-cannulated inner branches indicated for treatment of patients with thoraco-abdominal disease.
E-nside TM The E-nside TAAA multibranch stent graft system is an off-the-shelf stent graft with pre-cannulated inner branches indicated for treatment of patients with thoraco-abdominal disease. The E-nside’s pre-cannulated inner branches are designed to reduce the overall procedure time which reduces the patient’s exposure to radiation.
Each of these tissues maintains a structure which more closely resembles and simulates the performance of the patient’s own tissue compared to non-human tissue alternatives. Our vascular tissues are used to treat a variety of vascular reconstructions, such as peripheral bypass, hemodialysis access, and aortic infections, which have saved the lives and limbs of patients.
The vascular tissues currently preserved by us include saphenous veins, aortoiliac arteries, and femoral veins and arteries. Each of these tissues maintains a structure which more closely resembles and simulates the performance of the patient’s own tissue compared to non-human tissue alternatives.
In May 2023 we obtained FDA PMA approval to commercialize PerClot in the US, which we transferred to Baxter, and began manufacturing and supplying PerClot for Baxter, as discussed further in “Research and Development and Clinical Research” below. 15 Table of Contents Marketing and Distribution In the US and Canada, we market our products and preservation services primarily to physicians and sell our products through our approximately 50-person direct sales team to hospitals and other healthcare facilities.
The TMSA has been extended for an additional 24-month term and will expire in February 2027. Marketing and Distribution In the US and Canada, we market our products and preservation services primarily to physicians and sell our products through our approximately 50-person direct sales team to hospitals and other healthcare facilities.
The HDE allows for, subject to certain restrictions, commercial distribution of AMDS in the United States (“US”) prior to the approval of a Premarket Approval (“PMA”) Application, which we currently anticipate receiving in 2026 allowing for full commercial distribution of AMDS in the US.
The HDE allows for, subject to certain restrictions, commercial distribution of AMDS in the US prior to the approval of PMA, which we currently anticipate receiving in 2026 allowing for full commercial distribution of AMDS in the US. 10 Table of Contents On Oct 1, 2025 CMS made effective the 2026 IPPS (Inpatient Prospective Payment System) Final Rule in which AMDS received a new unique procedure code that was also included in the updated procedure logic.
BioGlue competes with these products based on its features and benefits, such as its strength and ease of use.
BioGlue competes primarily with surgical sealants from Baxter, Ethicon, Grena Ltd, Integra LifeSciences, and Bard, a subsidiary of BD. BioGlue competes with these products based on its features and benefits, such as its strength and ease of use. We sell BioGlue throughout the world including North America, EMEA, APAC, and LATAM.
Our custom E-xtra Design Engineering stent graft system includes TAAA and Artivex TM Thoracic Extension Stent Graft System (“Artivex”). Our custom TAAA is often used in conjunction with E-vita Thoracic 3G, as well as the AAA offering, the E-tegra, or in combination with both.
We have pioneered a service whereby we can manufacture a customized thoraco-abdominal stent graft in approximately 22 working days. Our custom E-xtra Design Engineering stent graft system includes TAAA and Artivex TM Thoracic Extension Stent Graft System (“Artivex”).

… 34 more changes not shown on this page.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

50 edited+12 added−10 removed120 unchanged
Biggest changeOur ability to realize the anticipated business opportunities, growth prospects, cost savings, synergies, and other benefits of these and other transactions depends on a number of factors including our ability to: • Leverage our global infrastructure to sell and cross-market the acquired products; • Drive adoption of the NEXUS family of products and AMDS in the European and other markets, including our ability to manage the substantial product training, implant support, and proctoring requirements for NEXUS procedures; • Bring acquired products to the US market, including our acquired aortic stent grafts; • Harness the aortic stent graft product pipeline and our research and development capabilities; • Obtain regulatory approvals in relevant markets, including our ability to timely obtain or maintain CE Mark product certifications for pipeline and current products; • Execute on development and clinical trial timelines for acquired products; • Manage global inventories, including our ability to manage inventories for product lines with large numbers of product configurations and manage manufacturing and demand cycles to avoid excess inventory obsolescence due to shelf life expiration, particularly for processed tissues and aortic stent grafts; • Carry, service, and manage significant debt and repayment obligations; and • Manage the unforeseen risks and uncertainties related to these transactions, including any related to intellectual property rights. 30 Table of Contents Additionally, our ability to realize the anticipated business opportunities, growth prospects, synergies, and other benefits of our 2019 Endospan transaction depends on a number of additional factors including Endospan’s ability to: (a) comply with the Endospan Loan and other debt obligations, and avoid an event of default; (b) successfully commercialize the NEXUS family of products, raise capital and drive adoption in markets in and outside of Europe; (c) meet demand for the NEXUS family of products; (d) meet quality and regulatory requirements for the NEXUS family of products; (e) manage any intellectual property risks and uncertainties associated with the NEXUS family of products; (f) obtain FDA approval of the NEXUS family of products; (g) remain a going concern; and (h) develop the NEXUS family of products, and other product improvements to meet competitive threats and physician demand.
Biggest changeOur ability to realize the anticipated business opportunities, growth prospects, cost savings, synergies, and other benefits of these and other transactions depends on a number of factors including our ability to: • Leverage our global infrastructure to sell and cross-market the acquired products; • Drive adoption of the NEXUS family of products and AMDS in the US, European, and other markets, including our ability to manage the substantial product training, implant support, and proctoring requirements for NEXUS procedures; • Bring acquired products to the US market, including our acquired aortic stent grafts; • Harness the aortic stent graft product pipeline and our research and development capabilities; • Obtain regulatory approvals in relevant markets, including our ability to timely obtain or maintain CE Mark product certifications for pipeline and current products; • Execute on development and clinical trial timelines for acquired products; • Manage global inventories, including our ability to manage inventories for product lines with large numbers of product configurations and manage manufacturing and demand cycles to avoid excess inventory obsolescence due to shelf life expiration, particularly for processed tissues and aortic stent grafts; • Carry, service, and manage significant debt and repayment obligations; and 30 Table of Contents • Manage the unforeseen risks and uncertainties related to these transactions, including any related to intellectual property rights.
Several of our competitors enjoy competitive advantages over us, including: • Greater financial and other resources for research and development, commercialization, acquisitions, and litigation and to weather the impacts of global economic downturns and workforce competition; • Greater name recognition as well as more recognizable trademarks for products similar to products that we sell; • More established record of obtaining and maintaining regulatory product clearances or approvals; 25 Table of Contents • More established relationships with healthcare providers and payors along with better positioning to minimize the impact of consolidated purchasing and other consolidation within the healthcare industry; • Lower cost of goods sold or preservation costs; and • Larger direct sales forces and more established distribution networks.
Several of our competitors enjoy competitive advantages over us, including: • Greater financial and other resources for research and development, commercialization, acquisitions, and litigation and to weather the impacts of global economic downturns and workforce competition; 25 Table of Contents • Greater name recognition as well as more recognizable trademarks for products similar to products that we sell; • More established record of obtaining and maintaining regulatory product clearances or approvals; • More established relationships with healthcare providers and payors along with better positioning to minimize the impact of consolidated purchasing and other consolidation within the healthcare industry; • Lower cost of goods sold or preservation costs; and • Larger direct sales forces and more established distribution networks.
Our failure to anticipate accurately these changes, or our failure to comply with changes to legal and regulatory frameworks, could create liability for us, result in adverse publicity and negatively affect our business, results of operations, and financial condition.
Our failure to accurately anticipate these changes, or our failure to comply with changes to legal and regulatory frameworks, could create liability for us, result in adverse publicity and negatively affect our business, results of operations, and financial condition.
The agreements currently governing our indebtedness contain, and any instruments governing future indebtedness of ours may contain, covenants that impose significant operating and financial restrictions on us and certain of our subsidiaries, including (subject in each case to certain exceptions) restrictions or prohibitions on our and certain of our subsidiaries’ ability to, among other things: • Incur or guarantee additional debt or create liens on certain assets; • Pay dividends on or make distributions of our share capital, including repurchasing or redeeming capital stock, or make other restricted payments, including restricted junior payments; • Enter into agreements that restrict our subsidiaries’ ability to pay dividends to us, repay debt owed to us or our subsidiaries, or make loans or advances to us or our other subsidiaries; • Enter into certain transactions with our affiliates including any transaction or merger or consolidation, liquidation, winding-up, or dissolution; convey, sell, lease, exchange, transfer or otherwise dispose of all or any part of our business, assets or property; or sell, assign, or otherwise dispose of any capital stock of any subsidiary; • Enter into certain rate swap transactions, basis swaps, credit derivative transactions, and other similar transactions, whether relating to interest rates, commodities, investments, securities, currencies, or any other relevant measure, or transactions of any kind subject to any form of master purchase agreement governed by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement; • Amend, supplement, waive, or otherwise modify our or our subsidiaries' organizational documents in a manner that would be materially adverse to the interests of the lender, or change or amend the terms of documentation regarding junior financing in a manner that would be materially adverse to the interests of the lender; • Make changes to our and our subsidiaries’ fiscal year without notice to the administrative agent; • Enter into agreements which restrict our ability to incur liens; • Engage in any line of business substantially different from that in which we are currently engaged; and 36 Table of Contents • Make certain investments, including strategic acquisitions or joint ventures.
The agreements currently governing our indebtedness contain, and any instruments governing future indebtedness of ours may contain, covenants that impose significant operating and financial restrictions on us and certain of our subsidiaries, including (subject in each case to certain exceptions) restrictions or prohibitions on our and certain of our subsidiaries’ ability to, among other things: • Incur or guarantee additional debt or create liens on certain assets; • Pay dividends on or make distributions of our share capital, including repurchasing or redeeming capital stock, or make other restricted payments, including restricted junior payments; • Enter into agreements that restrict our subsidiaries’ ability to pay dividends to us, repay debt owed to us or our subsidiaries, or make loans or advances to us or our other subsidiaries; • Enter into certain transactions with our affiliates including any transaction or merger or consolidation, liquidation, winding-up, or dissolution; convey, sell, lease, exchange, transfer or otherwise dispose of all or any part of our business, assets or property; or sell, assign, or otherwise dispose of any capital stock of any subsidiary; • Enter into certain rate swap transactions, basis swaps, credit derivative transactions, and other similar transactions, whether relating to interest rates, commodities, investments, securities, currencies, or any other relevant measure, or transactions of any kind subject to any form of master purchase agreement governed by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement; 36 Table of Contents • Amend, supplement, waive, or otherwise modify our or our subsidiaries’ organizational documents in a manner that would be materially adverse to the interests of the lender, or change or amend the terms of documentation regarding junior financing in a manner that would be materially adverse to the interests of the lender; • Make changes to our and our subsidiaries’ fiscal year without notice to the administrative agent; • Enter into agreements which restrict our ability to incur liens; • Engage in any line of business substantially different from that in which we are currently engaged; and • Make certain investments, including strategic acquisitions or joint ventures.
Our international operations subject us to a number of risks, which may vary significantly from the risks we face in our US operations, including: • Greater difficulties and costs associated with staffing at all levels, establishing and maintaining internal controls, managing foreign operations and distributor relationships, and selling directly to customers; 24 Table of Contents • Broader exposure to corruption and expanded compliance obligations, including under the Foreign Corrupt Practices Act, the UK Bribery Law, local anti-corruption laws, Office of Foreign Asset Control administered sanction programs, the European Union’s General Data Protection Regulation and Corporate Sustainability Reporting Directive, and other emerging corruption, sustainability, and data privacy and cybersecurity regulations; • Overlapping, ambiguous, and potentially conflicting, or unexpected changes in, international legal and regulatory requirements or reimbursement policies and programs; • Longer and more expensive collection cycles in certain countries, particularly those in which our primary customers are government-funded hospitals; • Changes in currency exchange rates, particularly fluctuations in the Euro as compared to the US Dollar and other inflationary pressures, given sensitivity to exchange rates that we experience from our product revenue streams and account balances; • Potential exposure to adverse financial impact and negative erosion of our operating profit margin over time due to increasing inflationary pressures, including impact felt through our supply chain, and this exposure may be increased through our limited ability to raise prices and through global expansion where business occurs with, or pricing is set directly by, government entities, or we are party to long term pricing agreements with governments or local distributors, impacting our ability to pass on rising costs; • Potential adverse tax consequences of overlapping tax structures or potential changes in domestic and international tax policy, laws, and treaties; and • Potential adverse consequences from unexpected global regulatory and trade developments.
Our international operations subject us to a number of risks, which may vary significantly from the risks we face in our US operations, including: • Greater difficulties and costs associated with staffing at all levels, establishing and maintaining internal controls, managing foreign operations and distributor relationships, and selling directly to customers; 24 Table of Contents • Broader exposure to corruption and expanded compliance obligations, including under the Foreign Corrupt Practices Act, the UK Bribery Law, local anti-corruption laws, Office of Foreign Asset Control administered sanction programs, the European Union’s General Data Protection Regulation and Corporate Sustainability Reporting Directive, and other emerging corruption, sustainability, and data privacy and cybersecurity regulations; • Overlapping, ambiguous, and potentially conflicting, or unexpected changes in, international legal and regulatory requirements or reimbursement policies and programs; • Longer and more expensive collection cycles in certain countries, particularly those in which our primary customers are government-funded hospitals; • Changes in currency exchange rates, particularly fluctuations in the Euro as compared to the US Dollar and other inflationary pressures, given sensitivity to exchange rates that we experience from our product revenue streams and account balances; • Potential exposure to adverse financial impact and negative erosion of our operating profit margin over time due to increasing inflationary pressures, including impact felt through our supply chain, and this exposure may be increased through our limited ability to raise prices and through global expansion where business occurs with, or pricing is set directly by, government entities, or we are party to long term pricing agreements with governments or local distributors, impacting our ability to pass on rising costs; • Potential adverse tax consequences of overlapping tax structures or potential changes in domestic and international tax policy, laws, and treaties; and • Potential adverse consequences from unexpected global regulatory or tariff and trade developments.
The per-and polyfluoroalkyl substances (“PFAS”) are used in a wide variety of consumer and industrial products, including medical devices and product packaging. PFAS have been subject to increasing regulations, and in some cases bans, by the Environmental Protection Agency and numerous states. These requirements impose a high compliance burden, and further regulation of PFAS-containing products is expected.
The per-and polyfluoroalkyl substances (“PFAS”) are used in a wide variety of consumer and industrial products, including medical devices and product packaging. PFAS have been subject to increasing global regulations, and in some cases bans, by the Environmental Protection Agency and numerous states. These requirements impose a high compliance burden, and further regulation of PFAS-containing products is expected.
Finally, although we recently received regulatory approval to market BioGlue in China, it was only after a significantly longer and more expensive regulatory approval process than likely could reasonably have been anticipated when the program began. Each of our trials, studies, and approvals is subject to the risks outlined herein.
Finally, although we have received regulatory approval to market BioGlue in China, it was only after a significantly longer and more expensive regulatory approval process than likely could reasonably have been anticipated when the program began. Each of our trials, studies, and approvals is subject to the risks outlined herein.
We face the following risks relating to BioGlue: • We may be unable to obtain approval to commercialize BioGlue in certain non-US countries as fast as our competitors do or at all. We also may not be able to capitalize on new BioGlue approvals, including for new indications, in non-US countries; and • BioGlue contains a bovine blood protein.
We face the following risks relating to BioGlue: • We may be unable to obtain approval to commercialize BioGlue in certain non-US countries as fast as our competitors do or at all. We also may not be able to capitalize on new BioGlue approvals, including for new indications, in non-US countries; BioGlue contains a bovine blood protein.
Although we have not experienced any material disruption of supply from Endospan, it is difficult to predict the ultimate course of these conflicts and we may face business operations and supply chain disruptions as a result, including disruptions related to shortages of materials and finished goods, higher costs of materials and freight, freight delays, increased energy costs or energy shortages, travel disruptions, currency fluctuation, and disruptions to banking systems or capital markets.
We have not experienced any material disruption of supply from Endospan; however, it is difficult to predict the ultimate course of these conflicts and we may face business operations and supply chain disruptions as a result, including disruptions related to shortages of materials and finished goods, higher costs of materials and freight, freight delays, increased energy costs or energy shortages, travel disruptions, currency fluctuation, and disruptions to banking systems or capital markets.
To date, sanctions and other disruptions in the Eastern European region have not materially impacted our business or ability to supply products to Russia, Belarus, Ukraine, and the region generally; however, continuation or escalation of the wars in Ukraine or instability in the Middle East, or increased export controls or additional sanctions imposed on or by impacted countries, their allies, or related entities could adversely affect our financial performance.
To date, sanctions and other disruptions in the Eastern European region have not materially impacted our business or ability to supply products to Russia, Belarus, Ukraine, and the region generally; however, continuation or escalation of the wars in Ukraine or instability in the Middle East, and in particular Iran, or increased export controls or additional sanctions imposed on or by impacted countries, their allies, or related entities could adversely affect our financial performance.
In connection with one or more of these transactions, we may: • Issue additional equity securities that would dilute our stockholders’ ownership interest; • Use cash we may need in the future to operate our business; • Incur debt, including on terms that could be unfavorable to us or debt we might be unable to repay; 29 Table of Contents • Structure the transaction resulting in unfavorable tax consequences, such as a stock purchase that does not permit a step-up in basis for the assets acquired; • Be unable to realize the anticipated benefits of the transaction; or • Assume material unknown liabilities associated with the acquired business.
In connection with one or more of these transactions, we may: • Issue additional equity securities that would dilute our stockholders’ ownership interest; • Use cash we may need in the future to operate our business; • Incur debt, including on terms that could be unfavorable to us or debt we might be unable to repay; • Structure the transaction resulting in unfavorable tax consequences, such as a stock purchase that does not permit a step-up in basis for the assets acquired; • Be unable to realize the anticipated benefits of the transaction; or • Assume material unknown liabilities associated with the acquired business.
Although the Endospan Option and our loan to Endospan were partially written back up to fair value in the third quarter of 2024, similar impairments, and other potential risks like those mentioned above, may adversely affect the market value of our common stock. We may not realize all the anticipated benefits of our business development activities.
Although the Endospan Option and our loan to Endospan were partially written back up to fair value in the third quarter of 2024 and subsequent quarters, similar impairments, and other potential risks like those mentioned above, may adversely affect the market value of our common stock. We may not realize all the anticipated benefits of our business development activities.
Factors beyond our control such as supply, regulatory changes, negative publicity concerning methods of tissue recovery or disease transmission from donated tissue, or public opinion of the donor process as well as our own reputation in the industry can negatively impact the supply of tissue; • Capitalize on our clinical advantages that we rely on as competitive strengths; or • Mitigate sufficiently the risk that tissue can become contaminated during processing; that processed tissue cannot be end-sterilized and hence carries an inherent risk of infection or disease transmission or that our quality controls can eliminate that risk.
Factors beyond our control such as supply, regulatory changes, negative publicity concerning methods of tissue recovery or disease transmission from donated tissue, or public opinion of the donor process as well as our own reputation in the industry can negatively impact the supply of tissue; • Timely receive and process tissues; • Capitalize on our clinical advantages that we rely on as competitive strengths; or • Mitigate sufficiently the risk that tissue can become contaminated during processing; that processed tissue cannot be end-sterilized and hence carries an inherent risk of infection or disease transmission or that our quality controls can eliminate that risk.
We face risks relating to aortic stent grafts based on our ability to: 26 Table of Contents • Develop innovative, high quality, and in-demand aortic repair products; • Respond adequately to enhanced regulatory requirements and enforcement activities, and particularly, our ability to obtain regulatory approvals and renewals globally; • Drive timely adoption of new products in our aortic stent graft portfolio; • Meet demand and manage inventory for aortic stent grafts as we seek to expand our business globally; and • Maintain a productive working relationship with our Works Council in Germany.
We face risks relating to aortic stent grafts based on our ability to: • Develop innovative, high quality, and in-demand aortic repair products; • Respond adequately to enhanced regulatory requirements and enforcement activities, and particularly, our ability to obtain regulatory approvals and renewals globally; • Drive timely adoption of new products in our aortic stent graft portfolio; • Meet demand and manage inventory for aortic stent grafts as we seek to expand our business globally; and • Maintain a productive working relationship with our Works Council in Germany.
In addition, political tensions between the US and certain other countries have escalated in recent years between and among these countries. Changes in foreign policy and the imposition of new sanctions could impact our ability to distribute products in certain regions. This could limit our market reach and affect our revenue streams.
In addition, political tensions between the US and certain other countries have escalated in recent years. Changes in foreign policy and the imposition of new sanctions could impact our ability to distribute products in certain regions. This could limit our market reach and affect our revenue streams.
Any security breaches, service interruptions, or data losses could adversely affect our business operations or result in the loss of critical or sensitive confidential information or intellectual property, or in financial, legal, business, and reputational harm to us or allow third parties to gain material, inside information that they may use to trade in our securities. 31 Table of Contents Our business could be impacted by environmental, social, and governance matters.
Any security breaches, service interruptions, or data losses could adversely affect our business operations or result in the loss of critical or sensitive confidential information or intellectual property, or in financial, legal, business, and reputational harm to us or allow third parties to gain material, inside information that they may use to trade in our securities. 31 Table of Contents Our business could be impacted by environmental, workforce, and governance-related matters.
Competition for talent and worker shortages at all levels have impacted supply chains and distribution channels and our ability to attract and retain the specialized workforce necessary for our business and operations. We continue to evaluate expansion through acquisitions of, or licenses with, investments in, and distribution arrangements with, other companies or technologies, which may carry significant risks.
Competition for talent and worker shortages at all levels have impacted supply chains and distribution channels and our ability to attract and retain the specialized workforce necessary for our business and operations. 29 Table of Contents We continue to evaluate expansion through acquisitions of, or licenses with, investments in, and distribution arrangements with, other companies or technologies, which may carry significant risks.
These provisions of Delaware law and our Certificate of Incorporation and Bylaws could prevent attempts by stockholders to remove current management, prohibit or delay mergers or other changes of control transactions, and discourage attempts by other companies to acquire us, even if such a transaction would be beneficial to our stockholders. 37 Table of Contents Item 1B. Unresolved Staff Comments.
These provisions of Delaware law and our Certificate of Incorporation and Bylaws could prevent attempts by stockholders to remove current management, prohibit or delay mergers or other changes of control transactions, and discourage attempts by other companies to acquire us, even if such a transaction would be beneficial to our stockholders. Item 1B. Unresolved Staff Comments. None.
Although we were able to transition our LRQA-issued certification for BioGlue to a new notified body, DEKRA, we are still in the process of transitioning the LRQA-issue certification for PhotoFix; and • New CE Marks: The increased workload on notified bodies and other uncertainties around the transition to the MDR will likely cause delays in the approval for any new products that we may wish to bring to the EU market. 32 Table of Contents While we continue to make progress on the MDR transition, the transition to new notified bodies, and the renewal of expired CE Marks, failure to timely complete any transfers or renewals, or to comply with transition to a newly designated UK Approved Body, or further delays in the MDR transition as a whole, may have a material, adverse effect on our ability to supply product in certain jurisdictions, have a material, adverse impact on our business, and may also impact our Medical Device Single Audit Program (“MDSAP”) certifications.
We have been able to transition our LRQA-issued certification for BioGlue and PhotoFix to a new notified body, DEKRA; and • New CE Marks: The increased workload on notified bodies and other uncertainties around the transition to the MDR will likely cause delays in the approval for any new products that we may wish to bring to the EU market. 32 Table of Contents While we continue to make progress on the MDR transition, the transition to new notified bodies, and the renewal of expired CE Marks, failure to timely complete any transfers or renewals, or to comply with transition to a newly designated UK Approved Body, or further delays in the MDR transition as a whole, may have a material, adverse effect on our ability to supply product in certain jurisdictions, have a material, adverse impact on our business, and may also impact our Medical Device Single Audit Program (“MDSAP”) certifications.
Regulatory focus, particularly with respect to sustainability matters, may change, reducing or changing regulations relating to ethylene oxide (EtO), per- and polyfluoroalkyl substances (PFAs), or other sustainability initiatives, potentially requiring us to make additional expenditures to comply with new regulations, or abandon programs we have already invested in.
Regulatory focus, particularly with respect to sustainability matters, may change, reducing or changing regulations relating to ethylene oxide (EtO), PFAS, or other sustainability initiatives, potentially requiring us to make additional expenditures to comply with new regulations, or abandon programs we have already invested in.
These changes may impact costs and reimbursement, as well as potential changes to the regulatory environment and healthcare generally. Many US healthcare laws, including the Affordable Care Act and the Federal Food, Drug, and Cosmetics Act, are complex, subject to change particularly during a change in administrations, and dependent on interpretation and enforcement decisions from government agencies with broad discretion.
These changes may impact costs and reimbursement, as well as potential changes to the regulatory environment and healthcare generally. Many US healthcare laws, including the Affordable Care Act and the Federal Food, Drug, and Cosmetics Act, are complex, subject to change, and dependent on interpretation and enforcement decisions from government agencies with broad discretion.
Changes in federal funding or staffing at administrative agencies like the FDA may impact, for example, the speed at which we are able to obtain regulatory approvals, and changes in the focus of those administrative agencies may result in the repeal of applicable regulations or guidance or impact us in other ways we can not anticipate.
Changes in regulations, federal funding or staffing at administrative agencies like the FDA may impact, for example, the speed at which we are able to obtain regulatory reviews and approvals. In addition, changes in the focus of those administrative agencies may result in the repeal of applicable regulations or guidance or impact us in other ways we cannot anticipate.
For example, we experienced a previously-disclosed cyber-attack in the fourth quarter of 2024 that temporarily disrupted our business operations, including our ERP systems, and had an impact on revenue, manufacturing, order processing, shipping, and other corporate operations (the “Cybersecurity Incident”).
For example, we experienced a previously-disclosed cybersecurity incident in the fourth quarter of 2024 that temporarily disrupted our business operations, including our ERP systems, and had an impact on revenue, manufacturing, order processing, shipping, and other corporate operations.
Changes in tax policy, including changes to corporate tax rates or changes in tax incentives that we currently benefit from, could negatively impact our results of operations and financial condition. The new administration has already taken numerous steps impacting federal spending and the federal workforce.
Changes in tax policy, including changes to corporate tax rates or changes in tax incentives that we currently benefit from, could also negatively impact our results of operations and financial condition. The new administration has taken steps that have impacted federal spending and the federal workforce.
Although we received approval to market BioGlue in China during the third quarter of 2024, we do not expect any revenue until at least the second half of 2025. We are significantly dependent on our revenues from aortic stent grafts and are subject to a variety of related risks.
Although we received approval to market BioGlue in China during the third quarter of 2024, we did not recognize any revenue until the second quarter of 2025. We are significantly dependent on our revenues from aortic stent grafts and are subject to a variety of related risks.
Many of these laws and regulations, including the European Union’s General Data Protection Regulation (“GDPR”) also include significant penalties for noncompliance.
Many of these laws and regulations, including, but not limited to, the European Union’s General Data Protection Regulation (“GDPR”) also include significant penalties for noncompliance.
Public health crises have, may continue to have, and could have a material, adverse impact on us. Because of our role in the healthcare industry, we are particularly susceptible to the impact public health crises have on healthcare systems globally, including impacts on system capacity and procedure volumes, shortages in healthcare staffing, and restrictions on travel and non-critical hospital access.
Because of our role in the healthcare industry, we are particularly susceptible to the impact public health crises have on healthcare systems globally, including impacts on system capacity and procedure volumes, shortages in healthcare staffing, and restrictions on travel and non-critical hospital access.
The delivery systems we manufacture are comprised of several different raw materials and subassemblies. Our internal manufacturing processes include machining of plastic parts, suturing of stent grafts, processing of Nitinol, and weaving of textiles. Our conventional polyester grafts consist of two main product components: polyester fabric and collagen coating.
The delivery systems we manufacture are comprised of several different raw materials and subassemblies, some of which are sourced from external suppliers, including single suppliers. Our internal manufacturing processes include machining of plastic parts, suturing of stent grafts, processing of Nitinol, and weaving of textiles. Our conventional polyester grafts consist of two main product components: polyester fabric and collagen coating.
If we do not pay cash dividends, our stockholders may receive a return on their investment in our common stock only through appreciation of shares of our common stock that they own. In addition, restrictions in our credit facility limit our ability to pay future dividends.
If we do not pay cash dividends, our stockholders may receive a return on their investment in our common stock only through appreciation of shares of our common stock that they own.
We believe these Guidances, if implemented as written, could significantly reduce the supply of safe implantable human tissue without simultaneously reducing the risk of Mtb transmission.
We believe these Guidances, if implemented as written, could significantly reduce the supply of safe implantable human tissue without simultaneously reducing the risk of Mtb transmission sufficient to offset the harm to patients caused by reduced safe-tissue supply.
As a result, we face increased risks related to: • Our Custom Devices: Stricter requirements on manufacturers of custom-made devices may delay, impede, or otherwise impact the availability of our E-xtra Design Engineering services and custom-made products; • Our Existing CE Marks: The extended timeline for the MDR transition has resulted in certain MDD-based CE Marks expiring prior to the completion of the transition.
As a result, we face increased risks related to: • Our Custom Devices: Stricter requirements on manufacturers of custom-made devices may delay, impede, or otherwise impact the availability of our E-xtra Design Engineering services and custom-made products; • Our Existing CE Marks: In the past, the extended timeline for the MDR transition has resulted in certain MDD-based CE Marks expiring prior to the completion of the transition; however, we were able to successfully renew such CE Marks under the MDR; • Our Notified Bodies: The combination of the increased regulatory framework under the MDR and the UK’s exit from the European Union have both had an impact on notified bodies.
Provisions of Delaware law and anti-takeover provisions in our organizational documents may discourage or prevent a change of control, even if an acquisition would be beneficial to stockholders, which could affect our share price adversely and prevent attempts by stockholders to remove current management. Effective January 1, 2022 we reincorporated in Delaware.
In addition, restrictions in our credit facility limit our ability to pay future dividends. 37 Table of Contents Provisions of Delaware law and anti-takeover provisions in our organizational documents may discourage or prevent a change of control, even if an acquisition would be beneficial to stockholders, which could affect our share price adversely and prevent attempts by stockholders to remove current management.
Even though the FDA approved the PMA-S, due to supply-related factors outside of our control, we eventually abandoned the business as of June 2023 resulting in a write-off of all of our CardioGenesis cardiac laser therapy assets and a recorded expense of $0.4 million during the year ended December 31, 2023 in our Consolidated Statements of Operations and Comprehensive Loss.
Even though the FDA approved the PMA-S, due to supply-related factors outside of our control, we eventually abandoned the business as of June 2023 resulting in a write-off of all of our CardioGenesis cardiac laser therapy assets and a recorded expense of $0.4 million during the year ended December 31, 2023 in our Consolidated Statements of Operations and Comprehensive Loss. 28 Table of Contents By way of additional non-limiting examples, our BioGlue product has three main product components: bovine protein, a cross linker, and a molded plastic resin delivery device.
Although some industry advocates and health care practitioners have expressed strong opposition to these new Guidances, and their implementation has been paused until at least May 2025, if and how they may ultimately be implemented and enforced, and how they may actually impact the availability of our donated tissue, remains to be seen and is difficult to predict.
Although some industry advocates and health care practitioners have expressed strong opposition to these new Guidances, and a number of them submitted comments regarding the Guidances during the recent comment period, if and how they may ultimately be implemented and enforced, and how they may actually impact the availability of our donated tissue, remains to be seen and is difficult to predict.
United States policy changes may have a material, adverse effect on us. The transition to a new presidential administration in the US brings several potential risks that could impact our business operations and financial performance. Changes in policy regarding international trade, including import and export regulation and international trade agreements, could negatively impact our business.
United States policy changes may have a material, adverse effect on us. The policies of the current presidential administration in the US continues to bring several potential risks that could impact our business operations and financial performance.
As a medical device manufacturer and tissue services provider we are exposed to risk of product liability claims and our existing insurance coverage may be insufficient, or we may be unable to obtain insurance in the future, to cover any resulting liability. 35 Table of Contents Our products and processed tissues allegedly have caused, and may in the future cause, injury or result in other serious complications that may result in product or other liability claims from our customers or their patients.
As a medical device manufacturer and tissue services provider we are exposed to risk of product liability claims and our existing insurance coverage may be insufficient, or we may be unable to obtain insurance in the future, to cover any resulting liability.
Animal-based products are subject to increased scrutiny from the public and regulators, who may seek to impose additional regulations, regulatory hurdles or product bans in certain countries on such products; BioGlue is a mature product and other companies may use the inventions disclosed in expired BioGlue patents to develop and make competing products.
Animal-based products are subject to increased scrutiny from the public and regulators, who may seek to impose additional regulations, regulatory hurdles or product bans in certain countries on such products; and • BioGlue is a mature product and other companies may use the inventions disclosed in expired BioGlue patents to develop and make competing products. 26 Table of Contents As an example of this risk, our regulatory approval for BioGlue in China took significantly longer and required significant additional investment, at least in part, due to BioGlue’s animal of origin components.
The impact of this uncertainty on us, our customers, or the specific services and relationships we have with our customers is not always clear.
This could delay clinical trials and product launches, impact the regulatory status of current products or services, or affect our competitive position. The impact of this uncertainty on us, our customers, or the specific services and relationships we have with our customers is not always clear.
We may be unable to make the investments in ESG programs that our competitors with greater financial resources are able to make or we may be challenged by governmental authorities if we choose to make such investments.
We may be unable to make the investments related to environmental, workforce, or governance initiatives at the same level as our competitors with greater financial resources, or we may be challenged by governmental authorities if we choose to make such investments.
Pre- and post-market clinical studies may also be delayed or halted due to many factors beyond our control.
Pre- and post-market clinical studies may also be delayed or halted due to many factors beyond our control, including, for example, reductions in FDA staff that may affect the agency’s response time.
The materials and supplies used in our product manufacturing and tissue processing are subject to regulatory requirements and oversight.
Operational Risks We are heavily dependent on our suppliers and contract manufacturers to provide quality products. The materials and supplies used in our product manufacturing and tissue processing are subject to regulatory requirements and oversight.
Governments, investors, customers, employees and other stakeholders are continuing to focus on areas of corporate responsibility, and particularly matters related to environmental, social, and governance (“ESG”) factors. Stakeholders are looking to companies that demonstrate strong ESG and sustainability practices as an indicator of long-term resilience.
Certain governments, investors, customers, employees and other stakeholders are continuing to focus on areas of corporate responsibility, including matters related to environmental impacts, workforce practices, and governance and risk oversight. In some cases, stakeholders are looking to companies that demonstrate strong performance in these areas as being better positioned for long-term resilience.
Additionally, our technologies, products, or services could infringe intellectual property rights owned by others, or others could infringe our intellectual property rights. If we become involved in intellectual property disputes, the costs could be expensive, and if we were to lose or decide to settle, the amounts or effects of the settlement or award by a tribunal could be costly.
If we become involved in intellectual property disputes, the costs could be expensive, and if we were to lose or decide to settle, the amounts or effects of the settlement or award by a tribunal could be costly. 27 Table of Contents Public health crises have, may continue to have, and could have a material, adverse impact on us.
If our products are defectively designed, manufactured, or labeled, or contain inadequate warnings, defective components, or are misused, or are used contrary to our warnings, instructions, and approved indications, we may become subject to costly litigation that can have unpredictable and sometimes extreme outcomes.
If our products are defectively designed, manufactured, or labeled, or contain inadequate warnings, defective components, or are misused, or are used contrary to our warnings, instructions, and approved indications, we may become subject to costly litigation that can have unpredictable and potentially extreme outcomes. 35 Table of Contents We maintain claims-made insurance policies to mitigate our financial exposure to product and tissue processing liability and securities, claims, among others, that are reported to the insurance carrier while the policy is in effect.
Bard (a subsidiary of Becton, Dickinson and Company), Integra Life Sciences, LifeNet, Corcym, Anteris Technologies, Elutia (formerly Aziyo Biologics), Cook Medical, Gore & Associates, Terumo, LeMaitre Vascular, Maquet, Pfizer, and BioCer Entwicklungs-GmbH.
We face intense competition in virtually all of our product lines, from, among others, Baxter, Ethicon (a Johnson & Johnson Company), Medtronic, Abbott Laboratories, Edwards Lifesciences, Becton, Dickinson and Company, Integra Life Sciences, LifeNet Health, Corcym, Anteris Technologies, Elutia (formerly Aziyo Biologics), Cook Medical, Gore & Associates, Terumo, LeMaitre Vascular, Maquet, Pfizer, BioCer Entwicklungs-GmbH, and Grena Limited.
This impact on healthcare system capacity may also affect our R&D pipeline by lengthening timelines for R&D and clinical research projects and timelines associated with regulatory reviews for new and updated devices, as well as affecting our workforce. 27 Table of Contents Operational Risks We are heavily dependent on our suppliers and contract manufacturers to provide quality products.
If other public health crises emerge in the future, we may experience similar adverse effects on our business. This impact on healthcare system capacity may also affect our R&D pipeline by lengthening timelines for R&D and clinical research projects and timelines associated with regulatory reviews for new and updated devices, as well as affecting our workforce.
By way of additional non-limiting examples, our BioGlue product has three main product components: bovine protein, a cross linker, and a molded plastic resin delivery device. The bovine protein and cross linker are obtained from a small number of qualified suppliers. The delivery devices are manufactured by a single supplier, using resin supplied by a different single supplier.
The bovine protein and cross linker are obtained from a small number of qualified suppliers. The delivery devices are manufactured by a single supplier, using resin supplied by a different single supplier. We purchase grafts for our On-X AAP from a single supplier and various other components for our On-X valves come from single-source suppliers.
The US has imposed tariffs and export controls on certain goods and products imported from abroad, which has resulted in retaliatory tariffs.
Changes in policy regarding international trade, including import and export regulation and international trade agreements, along with resulting volatility, could negatively impact our business. The US has imposed tariffs and export controls on certain goods and products imported from abroad, which has resulted in retaliatory tariffs.
Donated human tissue is procured from deceased human donors by organ and tissue procurement organizations (“OPOs”) and tissue banks.
Our preservation services business and our ability to supply needed tissues is dependent upon donation of tissues from human donors by donor families. Donated human tissue is procured from deceased human donors by organ and tissue procurement organizations (“OPOs”) and tissue banks.
Keeping up with and meeting these sometimes contradictory and evolving expectations can be difficult and expensive, and may disrupt our business and divert the attention of our management.
However, there is an increasing number of state-level and federal legislation, executive orders, and other backlash against such matters that may conflict with other regulatory requirements or our various stakeholders’ expectations. Keeping up with and meeting these sometimes contradictory and evolving expectations can be difficult and expensive, may disrupt our business, and may divert the attention of our management.
Removed
Ultimately, we were subject to an immaterial payment obligation following the conclusion of judicial challenges and negotiations between us, industry, US government representatives, and the Italian government.
Added
Ultimately, following the conclusion of judicial challenges, in August 2025, the Italian parliament agreed to a 75% reduction in the amounts due for the 2015–2018 period.
Removed
We face intense competition in virtually all of our product lines. A significant percentage of market revenues from competitive products are generated by Baxter, Ethicon (a Johnson & Johnson Company), Medtronic, Abbott Laboratories, Edwards Lifesciences, C.R.
Added
The Italian government is currently assessing the amounts due for the 2019–2024 period, and while there are ongoing challenges and negotiations between industry and the government regarding these amounts, our potential repayment exposure for the entire 2019–2025 period is estimated at approximately $2.3 million, which is reflected in accrued expenses in the Consolidated Balance Sheets as of December 31, 2025.
Removed
As an example of this risk, our regulatory approval for BioGlue in China took significantly longer and required significant additional investment, at least in part, due to BioGlue’s animal of origin components.
Added
In May 2025, the “final” Guidances were withdrawn and re-issued as drafts, with a public comment period that ended in July 2025. We and a number of other parties filed comments, the vast majority of which sought substantial modifications of the Guidances.
Removed
If other public health crises emerge in the future, we may experience similar adverse effects on our business.
Added
Additionally, our technologies, products, or services could infringe intellectual property rights owned by others, or others could infringe our intellectual property rights.
Removed
We purchase grafts for our On-X AAP from a single supplier and various other components for our On-X valves come from single-source suppliers. 28 Table of Contents Our preservation services business and our ability to supply needed tissues is dependent upon donation of tissues from human donors by donor families.
Added
Additionally, our ability to realize the anticipated business opportunities, growth prospects, synergies, and other benefits of our 2019 Endospan transaction depends on a number of additional factors including Endospan’s ability to: (a) comply with the Endospan Loan and other debt obligations, and avoid an event of default; (b) successfully commercialize the NEXUS family of products, raise capital, and drive adoption in markets in and outside of Europe; (c) meet demand for the NEXUS family of products; (d) meet quality and regulatory requirements for the NEXUS family of products; (e) manage any intellectual property risks and uncertainties associated with the NEXUS family of products; (f) obtain FDA approval of the NEXUS family of products; (g) remain as a going concern; and (h) develop the NEXUS family of products, and other product improvements to meet competitive threats and physician demand.
Removed
Our MDD-based CE Mark for BioGlue expired in December 2021, and for Chord-X in September 2022.
Added
Our products and processed tissues allegedly have caused, and may in the future cause, injury or result in other serious complications that may result in product or other liability claims from our customers or their patients.
Removed
We have since been able to successfully renew the CE Mark for BioGlue and Chord-X under the MDR; • Our Notified Bodies: The combination of the increased regulatory framework under the MDR and the UK’s exit from the European Union have both had an impact on notified bodies.
Added
These policies do not include coverage for punitive damages.
Removed
The new administration may introduce regulatory changes that could impact the speed to market and our ability to obtain timely reviews for our products. This could delay clinical trials and product launches, impact the regulatory status of current products or services, or affect our competitive position.
Added
Any resulting government enforcement activities may be costly, result in negative publicity, or subject us to significant penalties. Recent healthcare and tax legislation could have a material adverse effect on our business. On July 4, 2025 President Trump signed into law the “One Big Beautiful Bill Act,” which introduces comprehensive changes to U.S. tax and healthcare laws.
Removed
We maintain claims-made insurance policies to mitigate our financial exposure to product and tissue processing liability and securities, claims, among others, that are reported to the insurance carrier while the policy is in effect. These policies do not include coverage for punitive damages.
Added
Some of the provisions in this legislation have delayed effective dates, and we are still assessing the impact of those provisions. Many of its provisions will require interpretation and implementing regulations from federal agencies, including the Department of the Treasury.
Removed
Any resulting government enforcement activities may be costly, result in negative publicity, or subject us to significant penalties. Risks Relating to Our Indebtedness The agreements governing our indebtedness contain restrictions that limit our flexibility in operating our business.
Added
The law’s provisions include, but are not limited to, changes in corporate income tax rates and other business deductions, as well as changes to healthcare-related programs. The effect of interpretive guidance on these and other provisions could have a material adverse effect on our business, financial condition, and results of operations.
Added
We will continue to evaluate the impact of the “One Big Beautiful Bill Act” as additional information and guidance becomes available. Risks Relating to Our Indebtedness The agreements governing our indebtedness contain restrictions that limit our flexibility in operating our business.
Added
Effective January 1, 2022 we reincorporated in Delaware.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

7 edited+1 added−1 removed15 unchanged
Biggest changeAlthough we are continuing to work with our insurer to recoup covered losses, we do expect to continue to incur expenses in connection with improving our global cybersecurity infrastructure and cybersecurity posture. 38 Table of Contents As of the date of this Annual Report on Form 10-K, we believe that the Cybersecurity Incident has not materially impacted the Company, our overall financial condition or results of operations, and that the incident is not reasonably likely to materially impact the Company, our financial conditions or results of operations.
Biggest changeAs of the date of this Annual Report on Form 10-K, we believe that the Cybersecurity Incident has not materially impacted the Company, our overall financial condition, or results of operations, and that the incident is not reasonably likely to materially impact the Company, our financial conditions, or results of operations.
These updates, provided by our Chief Financial Officer and/or our global head of Information Technology, cover various cybersecurity topics, including data security posture, third-party assessment results, progress on risk mitigation goals, incident response plans, and select cybersecurity threat risks or incidents.
These updates, provided by our Chief Financial Officer & Chief Operating Officer and/or our global head of Information Technology, cover various cybersecurity topics, including data security posture, third-party assessment results, progress on risk mitigation goals, incident response plans, and select cybersecurity threat risks or incidents.
Management uses information provided by our global head of Information Technology, along with feedback from external experts, the Audit Committee, and our Board, as part of the cyber-specific and enterprise-wide risk management process described above. Our information technology and cybersecurity team has approximately 35 years of collective experience in information security and cybersecurity strategy, with various roles in significant organizations.
Management uses information provided by our global head of Information Technology, along with feedback from external experts, the Audit Committee, and our Board, as part of the cyber-specific and enterprise-wide risk management process described above. Our information technology and cybersecurity team has numerous years of collective experience in information security and cybersecurity strategy, with various roles in significant organizations.
To safeguard critical data and systems, support regulatory compliance, manage our material risks from cybersecurity threats, and identify, assess and respond to potential cybersecurity incidents, as such term is defined in Item 106(a) of Regulation S-K, we: • Monitor emerging data protection laws and adjust our processes and procedures as required or appropriate; • Utilize Endpoint Detection and Response (EDR) tools to help us prevent, detect, and respond to endpoint threats with real-time visibility across our infrastructure and devices, enterprise-wide; • Provide periodic, but no less than annual, training on cybersecurity, data privacy, and data handling to all employees and contractors with access to our systems; • Conduct periodic, but no less than, annual cybersecurity management and incident response training for relevant personnel, utilizing Knowbe4 resources; • Implement regular phishing simulations and processes for reporting phishing events and concerns to enhance staff awareness, vigilance, and responsiveness; • Mandate that both employees and service providers treat sensitive data with utmost care, enforced through policies, practices, and contracts; • Employ elements of the NIST incident handling framework for identifying, protecting, detecting, responding to, and recovering from cybersecurity incidents; and • Maintain cybersecurity risk insurance to mitigate potential financial losses from incidents.
To safeguard critical data and systems, support regulatory compliance, manage our material risks from cybersecurity threats, and identify, assess and respond to potential cybersecurity incidents, as such term is defined in Item 106(a) of Regulation S-K, we: • Monitor emerging data protection laws and adjust our processes and procedures as required or appropriate; • Utilize Endpoint Detection and Response (EDR) tools to help us prevent, detect, and respond to endpoint threats with real-time visibility across our infrastructure and devices, enterprise-wide; • Provide periodic, but no less than annual, training on cybersecurity, data privacy, and data handling to all employees and contractors with access to our systems; • Conduct periodic, but no less than, annual cybersecurity training for relevant personnel, utilizing Knowbe4 resources; • Implement regular phishing simulations and processes for reporting phishing events and concerns to enhance staff awareness, vigilance, and responsiveness; • Mandate that both employees and service providers treat sensitive data with utmost care, enforced through policies, practices, and contracts; • Employ elements of the NIST incident handling framework for identifying, protecting, detecting, responding to, and recovering from cybersecurity incidents; and • Maintain cybersecurity risk insurance to mitigate potential financial losses from incidents. 38 Table of Contents Our incident response plan outlines our approach to preparing for, detecting, responding to, and recovering from cybersecurity incidents, including severity assessment, containment, investigation, and remediation processes.
Team members’ relevant degrees and certifications include but are not limited to Certified Information Security Manager, Certified Information Systems Security Professional, Certified Ethical Hacker, Certified Penetration Tester, among others.
Team members’ relevant degrees and certifications include but are not limited to Certified Information Security Manager, Certified Information Systems Security Professional, Certified Ethical Hacker, Certified Penetration Tester, among others. 39 Table of Contents
As discussed in more detail in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, the Cybersecurity Incident had a $4.6 million impact on our results for the year ended December 31, 2024.
As discussed in more detail in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” the Cybersecurity Incident had a $4.6 million impact on our results for the year ended December 31, 2024 and a $4.3 million impact on our results for the year ended December 31, 2025, net of the aforementioned recoveries of $3.2 million.
We are seeking reimbursement of costs, expenses and losses stemming from the Cybersecurity Incident by submitting claims to our cybersecurity insurer. The timing and amount of any such reimbursements are not known at this time.
We are continuing to seek reimbursement of costs, expenses and losses stemming from the Cybersecurity Incident by submitting claims to our cybersecurity insurer. To date, we have recovered $3.2 million associated with the 2024 Cybersecurity Incident, but the timing and amount of any additional reimbursements are not known at this time.
Removed
Our incident response plan outlines our approach to preparing for, detecting, responding to, and recovering from cybersecurity incidents, including severity assessment, containment, investigation, and remediation processes.
Added
Although we are continuing to work with our insurer to recoup covered losses, we expect to continue to incur expenses in connection with improving our global cybersecurity infrastructure and cybersecurity posture.

Item 2. Properties

Properties — owned and leased real estate

2 edited+1 added−0 removed4 unchanged
Biggest changeOur primary European subsidiary, JOTEC, located in Hechingen, Germany, maintains facilities that consist of approximately 156,000 square feet of leased manufacturing, administrative, laboratory, and warehouse space where we manufacture aortic stent grafts. 39 Table of Contents Our On-X facility consists of approximately 75,000 square feet of combined manufacturing, administrative, laboratory, warehouse, and office space leased in Austin, Texas.
Biggest changeOur primary European facilities, located in Hechingen, Germany, consist of approximately 156,000 square feet of leased manufacturing, administrative, laboratory, and warehouse space where we manufacture aortic stent grafts.
We lease small amounts of ancillary office and warehouse space in various countries in which we operate direct sales subsidiaries, including in Brazil, Greece, Italy, Poland, Spain, Switzerland, and the United Kingdom. In April 2022 we opened a distribution center in Singapore to support sales activities in the APAC region.
We lease small amounts of ancillary office and warehouse space in various countries in which we operate direct sales subsidiaries, including in Brazil, Greece, Italy, Poland, Spain, Switzerland, and the United Kingdom, and a distribution center in Singapore to support sales activities in the APAC region.
Added
Our On-X facilities consist of approximately 75,000 square feet of combined manufacturing, administrative, laboratory, warehouse, and office space supporting our On-X manufacturing operations, as well as an adjacent approximately 87,000 square-foot building intended to support future capacity expansion, in Austin, Texas. Both properties were acquired through two real estate purchase transactions that closed in December 2025.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed5 unchanged
Biggest changeWe regularly evaluate the status of legal proceedings in which we are involved in order to assess whether a loss is probable or there is a reasonable possibility that a loss or additional loss may been incurred, and to determine if accruals are appropriate.
Biggest changeWe regularly evaluate the status of legal proceedings in which we are involved in order to assess whether a loss is probable or there is a reasonable possibility that a loss or additional loss may have been incurred, and to determine if accruals are appropriate.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

2 edited+0 added−0 removed2 unchanged
Biggest changeThe following table sets forth, for the periods indicated, the intra-day high and low sale prices per share of common stock on the NYSE. 2024 High Low First quarter $ 21.82 $ 16.48 Second quarter 25.74 19.36 Third quarter 29.24 23.79 Fourth quarter 30.45 24.82 2023 High Low First quarter $ 15.18 $ 11.44 Second quarter 17.69 12.57 Third quarter 17.97 14.58 Fourth quarter 19.00 12.16 As of February 21, 2025 we had 157 stockholders of record.
Biggest changeThe following table sets forth, for the periods indicated, the intra-day high and low sale prices per share of common stock on the NYSE. 2025 High Low First quarter $ 32.33 $ 22.93 Second quarter 31.66 21.97 Third quarter 45.07 30.06 Fourth quarter 48.25 38.95 2024 High Low First quarter $ 21.82 $ 16.48 Second quarter 25.74 19.36 Third quarter 29.24 23.79 Fourth quarter 30.45 24.82 As of February 13, 2026 we had 142 stockholders of record.
Dividends No dividends were paid in 2024, 2023, or 2022. Issuer Purchases of Equity Securities Neither the Company nor any affiliate or other party acting on behalf of the Company repurchased any of the Company's equity securities during the three months ended December 31, 2024.
Dividends No dividends were paid in 2025, 2024, or 2023. Issuer Purchases of Equity Securities Neither the Company nor any affiliate or other party acting on behalf of the Company repurchased any of the Company’s equity securities during the three months ended December 31, 2025.

Item 7. Management's Discussion & Analysis

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

73 edited+16 added−15 removed35 unchanged
Biggest changeThe following table reconciles revenues to constant currency revenues for the periods presented: Revenues for the Year Ended December 31, Percent Change From Prior Year 2024 2023 US GAAP US GAAP Exchange Rate Effect Constant Currency Constant Currency Products: Aortic stent grafts $ 123,081 $ 107,469 $ 1,052 $ 108,521 13% On-X 83,982 74,528 (8) 74,520 13% Surgical sealants 73,898 68,016 39 68,055 9% Other 9,269 11,172 8 11,180 (17)% Total products 290,230 261,185 1,091 262,276 11% Preservation services 98,307 92,819 (34) 92,785 6% Total $ 388,537 $ 354,004 $ 1,057 $ 355,061 9% North America 197,940 187,603 (75) 187,528 6% Europe, the Middle East, and Africa 131,518 114,814 1,838 116,652 13% Asia Pacific 37,202 33,577 — 33,577 11% Latin America 21,877 18,010 (706) 17,304 26% Total $ 388,537 $ 354,004 $ 1,057 $ 355,061 9% A detailed discussion of the changes in product revenues and preservation services revenues for the year ended December 31, 2024 is presented below.
Biggest changeExcluding the effects of foreign exchange, revenues increased 13% for the year ended December 31, 2025, as compared to the year ended December 31, 2024. 43 Table of Contents The following table reconciles revenues to constant currency revenues for the periods presented: Revenues for the Year Ended December 31, Percent Change From Prior Year 2025 2024 US GAAP Italian Payback Measure (2) Adjusted Revenue US GAAP Exchange Rate Effect Constant Currency Adjusted Constant Currency Products: Aortic stent grafts $ 159,371 $ — $ 159,371 $ 123,081 $ 2,701 $ 125,782 27% On-X 101,740 — 101,740 83,982 328 84,310 21% Surgical sealants 76,602 — 76,602 73,898 462 74,360 3% Other 8,112 2,313 10,425 9,269 12 9,281 12% Total products 345,825 2,313 348,138 290,230 3,503 293,733 19% Preservation services 95,505 — 95,505 98,307 (96) 98,211 (3) % Total $ 441,330 $ 2,313 $ 443,643 $ 388,537 $ 3,407 $ 391,944 13% North America 221,742 — 221,742 197,940 (216) 197,724 12% Europe, the Middle East, and Africa 151,368 2,313 153,681 131,518 4,221 135,739 13% Asia Pacific 44,250 — 44,250 37,202 — 37,202 19% Latin America 23,970 — 23,970 21,877 (598) 21,279 13% Total $ 441,330 $ 2,313 $ 443,643 $ 388,537 $ 3,407 $ 391,944 13% (2) Reduction in revenue from Italian government payback reserves.
Other expense, net for the year ended December 31, 2024 primarily included a net $5.4 million loss from realized and unrealized effects of foreign currency gains and losses and a $4.5 million loss associated with fair value adjustments to loans issued pursuant to our Endospan agreements.
Other (income) expense, net for the year ended December 31, 2024 primarily included a net $5.4 million loss from realized and unrealized effects of foreign currency gains and losses and a $4.5 million loss associated with fair value adjustments to loans issued pursuant to our Endospan agreements.
See Part II, Item 8, Note 10 of the “Notes to Consolidated Financial Statements” for further discussion of our new Ares Credit Agreement. Convertible Senior Notes On June 18, 2020 we issued $100.0 million aggregate principal amount of 4.25% Convertible Senior Notes with a maturity date of July 1, 2025 (the “Convertible Senior Notes”).
See Part II, Item 8, Note 10 of the “Notes to Consolidated Financial Statements” for further discussion of our amended Ares Credit Agreement. Convertible Senior Notes On June 18, 2020 we issued $100.0 million aggregate principal amount of 4.25% Convertible Senior Notes with a maturity date of July 1, 2025 (the “Convertible Senior Notes”).
For the year ended December 31, 2024, as compared to the year ended December 31, 2023, the US Dollar weakened in comparison to major currencies, resulting in revenue increases when these foreign currency denominated transactions were translated into US Dollars. Future changes in these exchange rates could have a material, adverse effect on our revenues denominated in these currencies.
For the year ended December 31, 2025, as compared to the year ended December 31, 2024, the US Dollar weakened in comparison to major currencies, resulting in revenue increases when these foreign currency denominated transactions were translated into US Dollars. Future changes in these exchange rates could have a material, adverse effect on our revenues denominated in these currencies.
Excluding the effects of foreign exchange, revenues increased 9% over the prior year. The increase in revenues was due to increases in revenues from aortic stent grafts, On-X products, surgical sealants, and preservation services, partially offset by a decrease in revenues from other products and certain limited impacts resulting from the Cybersecurity Incident.
Excluding the effects of foreign exchange, revenues increased 13% over the prior year. The increase in revenues was due to increases in revenues from aortic stent grafts, On-X products, and surgical sealants, partially offset by a decrease in revenues from other products and preservation services, and certain limited impacts resulting from the Cybersecurity incident.
The following discussion and analysis do not include certain items related to the year ended December 31, 2022, including year-to-year comparisons between the year ended December 31, 2023 and the year ended December 31, 2022. For a comparison of our results of operations for the fiscal years ended December 31, 2023 and December 31, 2022, see Item 7.
The following discussion and analysis do not include certain items related to the year ended December 31, 2023, including year-to-year comparisons between the year ended December 31, 2024 and the year ended December 31, 2023. For a comparison of our results of operations for the fiscal years ended December 31, 2024 and December 31, 2023, see Item 7.
Management uses constant currency revenues internally to assess the operational performance of the Company, as a component in compensation metrics, and as a basis for strategic planning. We believe the provided non-GAAP measures are meaningful in addition to the information contained in the US GAAP presentation of financial performance.
Management uses constant currency revenues internally to assess the operational performance of the Company, as a component in compensation metrics, and as a basis for strategic planning. 48 Table of Contents We believe the provided non-GAAP measures are meaningful in addition to the information contained in the US GAAP presentation of financial performance.
Fixed production overhead costs are allocated based on actual tissue processing levels, to the extent that they are within the range of the facility’s normal capacity. 42 Table of Contents These costs are then allocated among the tissues processed during the period based on cost drivers, such as the number of donors or number of tissues processed.
Fixed production overhead costs are allocated based on actual tissue processing levels, to the extent that they are within the range of the facility’s normal capacity. These costs are then allocated among the tissues processed during the period based on cost drivers, such as the number of donors or number of tissues processed.
Aortic stent grafts include aortic arch stent grafts, abdominal stent grafts, and synthetic vascular grafts. Aortic arch stent grafts include our E-vita Open NEO, E-vita Open Plus, AMDS, NEXUS ONE, NEXUS DUO, and NEXUS TRE, and E-vita Thoracic 3G products. Abdominal stent grafts include our E-xtra Design Engineering, E-nside, E-tegra, E-ventus BX, Tuva™ BX, and E-liac products.
Aortic stent grafts include aortic arch stent grafts, abdominal stent grafts, and synthetic vascular grafts. Aortic arch stent grafts include our E-vita Open NEO, E-vita Open Plus, Arcevo LSA, AMDS, NEXUS ONE, NEXUS DUO, and NEXUS TRE, and E-vita Thoracic 3G products. Abdominal stent grafts include our E-xtra Design Engineering, E-nside, Artivex, E-tegra, E-ventus BX, Tuva BX, and E-liac products.
Non-GAAP Measures of Financial Performance To supplement our Consolidated Financial Statements presented in accordance with US GAAP, we use constant currency revenues, which is a non-GAAP financial measure. We define constant currency revenues as revenues minus the exchange rate effect.
Non-GAAP Measures of Financial Performance To supplement our Consolidated Financial Statements presented in accordance with US GAAP, we use constant currency revenues, which is a non-GAAP financial measure. We define constant currency revenues as revenues adjusted for the exchange rate effect.
Aortic arch stent grafts include our E-vita Open NEO, E-vita Open Plus, AMDS, the NEXUS family of products, and E-vita Thoracic 3G products. Abdominal stent grafts include our E-xtra Design Engineering, E-nside, E-tegra, E-ventus BX, Tuva™ BX, and E-liac products.
Aortic arch stent grafts include our E-vita Open NEO, E-vita Open Plus, Arcevo LSA, AMDS, the NEXUS family of products, and E-vita Thoracic 3G products. Abdominal stent grafts include our E-xtra Design Engineering, E-nside, Artivex, E-tegra, E-ventus BX, Tuva BX, and E-liac products.
See Part II, Item 8, Note 4 - “Agreements with Endospan” of the “Notes to Consolidated Financial Statements” for further information on our agreements with Endospan. Income Tax Expense Our effective income tax rate was an expense of 78% and 42% for the year ended December 31, 2024 and 2023, respectively.
See Part II, Item 8, Note 4 - “Agreements with Endospan” of the “Notes to Consolidated Financial Statements” for further information on our agreements with Endospan. Income Tax Expense Our effective income tax rate was an expense of 34% and 78% for the year ended December 31, 2025 and 2024, respectively.
Aortic stent grafts are used in endovascular and open vascular surgery for the treatment of complex aortic arch, thoracic, and abdominal aortic diseases. Our aortic stent grafts are primarily distributed in international markets. Revenues from the sales of aortic stent grafts increased 15% for the year ended December 31, 2024, as compared to the year ended December 31, 2023.
Aortic stent grafts are used in endovascular and open vascular surgery for the treatment of complex aortic arch, thoracic, and abdominal aortic diseases. Our aortic stent grafts are primarily distributed in international markets. Revenues from the sales of aortic stent grafts increased 29% for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
Loss on Extinguishment of Debt During the year ended December 31, 2024 we recorded a loss on extinguishment of debt of $3.7 million in connection with the extinguishment of our previously existing credit facilities. See Part II, Item 8, Note 10 of the “Notes to Consolidated Financial Statements” for further discussion of our new credit facilities.
During the year ended December 31, 2024 we recorded a loss on extinguishment of debt of $3.7 million in connection with the extinguishment of our previously existing credit facilities. See Part II, Item 8, Note 10 of the “Notes to Consolidated Financial Statements” for further discussion of our Convertible Senior Notes and credit facilities.
Our operating and finance lease obligations result from the lease of land and buildings that comprise our corporate headquarters and our various manufacturing facilities; leases related to additional manufacturing, office, and warehouse space; leases on company vehicles; and leases on a variety of office and other equipment. 51 Table of Contents Capital Expenditures Capital expenditures for the year ended December 31, 2024 and 2023 were $11.2 million and $9.8 million, respectively.
Our operating and finance lease obligations result from the lease of land and buildings that comprise our corporate headquarters and our various manufacturing facilities; leases related to additional manufacturing, office, and warehouse space; leases on company vehicles; and leases on a variety of office and other equipment. 51 Table of Contents Capital Expenditures Capital expenditures for the year ended December 31, 2025 and 2024 were $39.0 million and $11.2 million, respectively.
The increase in revenues for the year ended December 31, 2024 was due to an increase in revenues from aortic stent grafts, On-X products, surgical sealants, and preservation services, partially offset by a decrease in revenues from other products.
Revenues increased 14% for the year ended December 31, 2025, as compared to the year ended December 31, 2024. The increase in revenues for the year ended December 31, 2025 was due to an increase in revenues from aortic stent grafts, On-X products, and surgical sealants, partially offset by a decrease in revenues from other products and preservation services.
We believe that cash generated from operations, together with amounts available under the revolving credit facility will be sufficient to meet working capital requirements and anticipated capital expenditures, and other strategic uses of cash, if any, and debt payments, if any, over the next twelve months.
We believe that cash generated from operations, together with amounts available under our Credit Facilities, as defined below, will be sufficient to meet working capital requirements and anticipated capital expenditures, and other strategic uses of cash, if any, and debt payments, if any, over the next twelve months.
Constant currency revenues from the sales of On-X products increased 13% for the year ended December 31, 2024, as compared to the year ended December 31, 2023. Revenues for the year ended December 31, 2024 increased in all geographies, with the most significant increase in North America.
Constant currency revenues from the sales of On-X products increased 21% for the year ended December 31, 2025, as compared to the year ended December 31, 2024. Revenues for the year ended December 31, 2025 increased in all geographies, with the most significant increase in North America and EMEA.
We began to manufacture and supply PerClot ® hemostatic powder (“PerClot”) during the second quarter of 2023 (as part of the Transitional Manufacturing and Supply Agreement (“TMSA”) of the Baxter Transaction, described below). For the year ended December 31, 2024 we reported annual revenues of $388.5 million, increasing 10% over the prior year.
We began to manufacture and supply PerClot ® hemostatic powder (“PerClot”) during the second quarter of 2023 (as part of the Transitional Manufacturing and Supply Agreement (“TMSA”) of the Baxter Transaction, described below). For the year ended December 31, 2025 we reported annual revenues of $441.3 million, increasing 14% over the prior year.
For the year ended December 31, 2024 we reported a net loss of $13.4 million. See the “Results of Operations” section below for additional analysis of the full year 2024 results. See Part I, Item 1, “Business,” for further discussion of our business and activities during 2024.
For the year ended December 31, 2025 we reported a net income of $9.8 million. See the “Results of Operations” section below for additional analysis of the full year 2025 results. See Part I, Item 1, “Business,” for further discussion of our business and activities during 2025.
Management's Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 23, 2024. 41 Table of Contents Overview Artivion, Inc.
Management ’ s Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on February 28, 2025. 41 Table of Contents Overview Artivion, Inc.
Domestic revenues from the sales of On-X products accounted for 61% and 60% of total On-X revenues for the year ended December 31, 2024 and 2023, respectively.
Domestic revenues from the sales of On-X products accounted for 61% of total On-X revenues for both the year ended December 31, 2025 and 2024.
Research and development spending for the year ended December 31, 2024 and 2023 was primarily focused on clinical work to gain regulatory approvals for certain aortic stent grafts, and, to a lesser extent, On-X products.
Research and development spending for the year ended December 31, 2025 and 2024 was primarily focused on clinical work to gain regulatory approvals for certain aortic stent grafts.
During the year ended December 31, 2024 cash flows used in investing activities primarily included $11.2 million of cash used for capital expenditures and $17.0 million for the funding of loans made pursuant to the Endospan agreements.
Cash flows used in investing activities during the year ended December 31, 2024 included $11.2 million of cash used for capital expenditures and $17.0 million for the funding of loans made pursuant to the Endospan agreements. Financing Activities Net cash provided by financing activities was $11.3 million and $2.2 million for the year ended December 31, 2025 and 2024, respectively.
Our cardiac valves are primarily used in cardiac replacement and reconstruction surgeries, including the Ross procedure, for patients with endocarditis or congenital heart defects. Our cardiac tissues are primarily distributed in domestic markets.
Preservation Services Preservation services include service revenues from processing cardiac and vascular tissues. Our cardiac valves are primarily used in cardiac replacement and reconstruction surgeries, including the Ross procedure, for patients with endocarditis or congenital heart defects. Our cardiac tissues are primarily distributed in domestic markets.
Revenues from the sales of On-X products increased 13% for the year ended December 31, 2024, as compared to the year ended December 31, 2023. This increase was primarily due to an increase in the volume of units sold and, to a lesser extent, an increase in average sales prices.
Revenues from the sales of On-X products increased 21% for the year ended December 31, 2025, as compared to the year ended December 31, 2024. This increase was primarily due to an increase in the volume of units sold as well as an increase in average sales prices.
There are no scheduled repayments of principal required to be made prior to the final maturity date. We have the right to prepay loans under the Ares Credit Agreement in whole or in part at any time, subject to certain premium payment requirements. Amounts repaid in respect of loans under the Term Loan Facilities may not be reborrowed.
The final scheduled maturity date of the Credit Facilities is January 18, 2031. There are no scheduled repayments of principal required to be made prior to the final maturity date. We have the right to prepay loans under the Ares Credit Agreement in whole or in part at any time, subject to certain premium payment requirements.
Cost of preservation services included costs for cardiac and vascular tissue preservation services. Cost of preservation services for the year ended December 31, 2024 was negatively impacted by an increase in cost of certain tissues shipped, offset by a decrease in volume of certain tissues shipped.
Cost of preservation services included costs for cardiac and vascular tissue preservation services. The increase in cost of preservation services was primarily due to an increase in the cost of tissues shipped, partially offset by a decrease in the volume of tissues shipped, as compared to the year ended December 31, 2024.
Other expense, net for the year ended December 31, 2023 primarily included a $5.0 million loss associated with fair value adjustments to loans issued pursuant to our Endospan agreements, partially offset by a $2.1 million gain from realized and unrealized effects of foreign currency gains and losses.
Other income (expense), net for the year ended December 31, 2025 primarily included a net $7.2 million gain from realized and unrealized effects of foreign currency gains and losses and a $2.3 million gain associated with fair value adjustments to loans issued pursuant to our Endospan agreements.
Operating Expenses General, Administrative, and Marketing Expenses Year Ended December 31, 2024 2023 General, administrative, and marketing expenses $ 181,455 $ 208,977 General, administrative, and marketing expenses as a percentage of total revenues 47 % 59 % General, administrative, and marketing expenses decreased 13% for the year ended December 31, 2024, as compared to the year ended December 31, 2023, which includes the impact of the Ascyrus contingent consideration fair value adjustment gain of $11.0 million and loss of $23.5 million for the year ended December 31, 2024 and 2023, respectively.
Operating Expenses General, Administrative, and Marketing Expenses Year Ended December 31, 2025 2024 General, administrative, and marketing expenses $ 226,491 $ 181,455 General, administrative, and marketing expenses as a percentage of total revenues 51 % 47 % General, administrative, and marketing expenses increased 25% for the year ended December 31, 2025, as compared to the year ended December 31, 2024, which includes the impact of the Ascyrus contingent consideration fair value adjustment loss of $7.7 million and gain of $11.0 million for the year ended December 31, 2025 and 2024, respectively.
Cash flows used in investing activities during the year ended December 31, 2023 included $9.8 million of cash used for capital expenditures and $5.0 million for the funding of loans made pursuant to the Endospan agreements, which were partially offset by $14.3 million of proceeds received as part of the Baxter transaction from the sale of non-financial assets.
During the year ended December 31, 2025 cash flows used in investing activities primarily included $39.0 million of cash used for capital expenditures, as discussed below, and $8.0 million for the funding of loans made pursuant to the Endospan agreements, partially offset by $5.0 million proceeds from the sale of non-financial assets.
Research and Development Expenses Year Ended December 31, 2024 2023 Research and development expenses $ 28,452 $ 28,707 Research and development expenses as a percentage of total revenues 7 % 8 % 47 Table of Contents Research and development expenses decreased 1% for the year ended December 31, 2024, as compared to the year ended December 31, 2023.
Research and Development Expenses Year Ended December 31, 2025 2024 Research and development expenses $ 30,991 $ 28,452 Research and development expenses as a percentage of total revenues 7 % 7 % 47 Table of Contents Research and development expenses increased 9% for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
Investors should consider this non-GAAP information in addition to, and not as a substitute for, financial measures prepared in accordance with US GAAP.
Investors should consider this non-GAAP information in addition to, and not as a substitute for, financial measures prepared in accordance with US GAAP. In addition, this non-GAAP financial information may not be the same as similar measures presented by other companies.
Cost of Products and Preservation Services Cost of Products Year Ended December 31, 2024 2023 Cost of products $ 99,385 $ 84,595 Cost of products increased 17% for the year ended December 31, 2024, as compared to the year ended December 31, 2023.
Cost of Products and Preservation Services Cost of Products Year Ended December 31, 2025 2024 Cost of products $ 112,781 $ 99,385 Cost of products increased 13% for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
Gross Margin Year Ended December 31, 2024 2023 Gross margin $ 248,781 $ 229,176 Gross margin as a percentage of total revenues 64 % 65 % Gross margin increased 9% for the year ended December 31, 2024, as compared to the year ended December 31, 2023.
Gross Margin Year Ended December 31, 2025 2024 Gross margin $ 284,227 $ 248,781 Gross margin as a percentage of total revenues 64 % 64 % Gross margin increased 14% for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
Other Expense, Net Other expense, net was $9.9 million and $3.1 million for the year ended December 31, 2024 and 2023, respectively.
Other (Income) Expense, Net Other (income) expense, net was $9.5 million of income and $9.9 million of expense for the year ended December 31, 2025 and 2024, respectively.
Our practice is to maintain sufficient liquidity through cash from operations and our revolving credit facility to mitigate the impacts of any adverse financial market conditions on our operations.
As of December 31, 2025 approximately 34% of our cash and cash equivalents were held in foreign jurisdictions. Our practice is to maintain sufficient liquidity through cash from operations and our revolving credit facility to mitigate the impacts of any adverse financial market conditions on our operations.
The revenue increase in EMEA for the year ended December 31, 2024 was primarily due to an increase in volume of higher priced products within the aortic stent graft product line in direct (to hospitals) markets. On-X Products The On-X products include the On-X aortic and mitral heart valves and the On-X ascending aortic prosthesis (“AAP”) for heart valve replacement.
The revenue increase in EMEA for the year ended December 31, 2025 was primarily due to an increase in volume of higher priced products within the aortic stent graft product line in direct (to hospitals) markets.
Revenues from the sales of surgical sealants increased 9% for the year ended December 31, 2024, as compared to the year ended December 31, 2023. This increase was primarily due to an increase in the volume of milliliters sold and, to a lesser extent, an increase in average sales prices.
This increase was primarily due to an increase in average sales prices as well as an increase in the volume of milliliters sold. 45 Table of Contents Constant currency revenues from the sales of surgical sealants increased 3% for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
The increase in gross margin for the year ended December 31, 2024, as compared to the year ended December 31, 2023 was due to an increase in the volume of all products shipped as well as favorable pricing of certain aortic stent grafts, surgical sealants, On-X products, and tissues shipped during 2024.
The increase in gross margin for the year ended December 31, 2025, as compared to the year ended December 31, 2024 was due to an increase in the volume of all products shipped as well as the increase in the average sales price of certain products and tissues shipped and favorable mix of certain products shipped during 2025.
We do not believe the demand for our On-X and other products is seasonal. Demand for our cardiac preservation services has traditionally been seasonal, with peak demand generally occurring in the third quarter. We believe this trend for cardiac preservation services is primarily due to the high number of surgeries scheduled during the summer months for school-aged patients.
Demand for our vascular preservation services has also traditionally been seasonal, with lowest demand generally occurring in the fourth quarter. We believe this trend for vascular preservation services is primarily due to fewer vascular surgeries being scheduled during the winter holiday months. We do not believe demand for our On-X products, other products, and cardiac preservation services is materially seasonal.
We regularly evaluate our deferred preservation costs to determine if the costs are appropriately recorded at the lower of cost or net realizable value. We also evaluate our deferred preservation costs for costs not deemed to be recoverable, including tissues not expected to ship prior to the expiration date of their packaging.
We also evaluate our deferred preservation costs for costs not deemed to be recoverable, including tissues not expected to ship prior to the expiration date of their packaging.
Scheduled Contractual Obligations and Future Payments Our long-term debt obligations and interest payments include $320.0 million of scheduled principal payments and $119.2 million in anticipated interest payments related to our Initial Term Loan Facility, Revolving Credit Facility, and Convertible Senior Notes.
Scheduled Contractual Obligations and Future Payments Our long-term debt obligations and interest payments include $220.0 million of scheduled principal payments and $146.1 million in anticipated interest payments related to our Term Loan Facility, Revolving Credit Facility, and new Delayed Draw Term Loan Facility.
Products Revenues from products increased 11% for the year ended December 31, 2024, as compared to the year ended December 31, 2023. The increase was due to an increase in revenues from aortic stent grafts, On-X products, and surgical sealants, partially offset by a decrease in revenues from other products and certain limited impacts resulting from the Cybersecurity Incident.
The increase was due to an increase in revenues from aortic stent grafts, On-X products, and surgical sealants, partially offset by a decrease in revenues from other products. The revenue growth rate for the year ended December 31, 2025 was favorably impacted by decreased revenues in the fourth quarter of 2024 resulting from the 2024 cybersecurity incident.
Our liquidity as of December 31, 2024 consisted of cash and cash equivalents of $53.5 million, unused commitments of $30.0 million under a revolving credit facility and unused commitments of $100.0 million on delayed draw term loan facility (see “Credit Facilities” below). As of December 31, 2024 approximately 48% of our cash and cash equivalents were held in foreign jurisdictions.
Our liquidity as of December 31, 2025 consisted of cash and cash equivalents of $64.9 million, unused commitments of $30.0 million under a revolving credit facility, and unused commitments of $150.0 million on the new delayed draw term loan facility (see “Credit Facilities” below).
Actual yields could differ significantly from our estimates, which could result in a change in tissues available for shipment and could increase or decrease the balance of deferred preservation costs. These changes could result in additional cost of preservation services expense or could increase per tissue preservation costs, which would impact gross margins on tissue preservation services in future periods.
Actual yields could differ from our estimates, which could result in a change in tissues available for shipment and could increase or decrease the balance of deferred preservation costs.
Capital expenditures in the year ended December 31, 2024 were primarily related to routine purchases of computer software, manufacturing and tissue processing equipment, leasehold improvements needed to support our business and computer equipment.
Capital expenditures in the year ended December 31, 2025 were primarily related to $20.3 million for the acquisition of buildings in Austin, Texas supporting our On-X manufacturing operations and future capacity expansion, as well as routine purchases of computer software, manufacturing and tissue processing equipment, computer equipment, and leasehold improvements needed to support our business.
The increase in the effective income tax rate for the year ended December 31, 2024 was primarily due to changes in the jurisdictional mix of our earnings and valuation allowance, higher nondeductible executive compensation, state taxes and provision to return adjustments.
The decrease in the effective income tax rate for the year ended December 31, 2025 was primarily due to a decrease in valuation allowance resulting from the enactment of the One Big, Beautiful Bill Act and favorable changes to tax rates in certain jurisdictions, partially offset by changes in the jurisdictional mix of our earnings, higher nondeductible executive compensation, and provision to return adjustments.
In addition, this non-GAAP financial information may not be the same as similar measures presented by other companies. 48 Table of Contents Seasonality Historically, we believe the demand for most of our aortic stent grafts is seasonal, with a decline in demand generally occurring in the third quarter due to the summer holiday season in Europe.
Seasonality Historically, we believe the demand for most of our aortic stent grafts is seasonal, with a decline in demand generally occurring in the third quarter primarily due to the summer holiday season in Europe.
The Credit Facilities currently bear interest at the Adjusted Term Secured Overnight Financing Rate (“Adjusted Term SOFR”) plus applicable margins. As of December 31, 2024 the aggregate interest rate was 11.09% and 8.59% per annum for the Term Loan Facilities and Revolving Credit Facility, respectively.
Amounts repaid in respect of loans under the Term Loan Facilities may not be reborrowed. The Credit Facilities currently bear interest at the Secured Overnight Financing Rate (“SOFR”) plus applicable margins. As of December 31, 2025 the aggregate interest rate was 8.74% and 7.49% per annum for the Term Loan Facilities and Revolving Credit Facility, respectively.
The current year cash provided by financing activities was primarily due to $5.7 million of proceeds from exercise of stock options and issuances of common stock and $0.7 million of net proceeds received on our new credit facilities after repaying and extinguishing all obligations on our old credit facilities, all of which were partially offset by payments of $2.5 million for debt issuance costs and $1.0 million for repayments of short-term notes payable.
The current year cash provided by financing activities was primarily due to $13.1 million of proceeds from exercise of stock options and issuances of common stock and $3.1 million of proceeds from financing insurance premiums, partially offset by $2.3 million for principal payments on short-term notes payable and $1.8 million for payment of debt issuance cost.
Gross margin as a percentage of total revenues was negatively impacted by an increase in the cost of certain aortic stent grafts, largely due to an idle capacity charge resulting from the fourth quarter cybersecurity incident, and other products, unfavorable geography mix of On-X products shipped, partially offset by favorable pricing of certain tissues, favorable product mix of certain aortic stent grafts, and On-X products shipped during the year ended December 31, 2024.
Gross margin as a percentage of total revenues was positively impacted by a favorable geography and product mix as well as favorable pricing of certain products shipped, partially offset by an unfavorable mix of tissues shipped and an unfavorable cost of certain products and tissues shipped during the year ended December 31, 2025.
Our primary sources of funding are operating cash flows and borrowings under our debt facilities. As of December 31, 2024 we had approximately $320.2 million of total nominal indebtedness outstanding.
Liquidity and Capital Resources Our primary uses of liquidity include the payment of operating expenses, capital expenditures, servicing of debt and the funding of acquisitions or other collaborative arrangements. Our primary sources of funding are operating cash flows and borrowings under our debt facilities. As of December 31, 2025 we had approximately $220.0 million of total nominal indebtedness outstanding.
Other Other revenues are comprised of revenues from PhotoFix and PerClot (as part of the TMSA of the Baxter Transaction described below), and CardioGenesis cardiac laser therapy (prior to our abandonment of that business as of June 2023). 45 Table of Contents Other revenues decreased 17% for the year ended December 31, 2024, as compared to the year ended December 31, 2023.
Other Other revenues are comprised of revenues from PhotoFix and PerClot (as part of the TMSA of the Baxter Transaction described below), and reserves related to the Italian payback measure described below. Other revenues decreased 12% for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
Cost of products for the year ended December 31, 2024 and 2023 included costs related to aortic stent grafts, On-X, surgical sealants, and other products. Cost of products for the year ended December 31, 2024 included a $2.0 million idle capacity charge resulting from the previously disclosed cybersecurity incident that occurred during the fourth quarter of 2024.
Cost of products for the year ended December 31, 2025 and 2024 included costs related to aortic stent grafts, On-X products, surgical sealants, and other products.
The remaining increase in cost of products as compared to the year ended December 31, 2023 was primarily due to an increase in volume of On-X and aortic stent grafts shipped and an increase of the cost of certain aortic stent grafts and other products shipped, partially offset by favorable product mix. 46 Table of Contents Cost of Preservation Services Year Ended December 31, 2024 2023 Cost of preservation services $ 40,371 $ 40,233 Cost of preservation services remained flat for the year ended December 31, 2024, as compared to the year ended December 31, 2023.
The increase in cost of products for the year ended December 31, 2025 was primarily due to an increase in the volume of all products shipped, as compared to the year ended December 31, 2024. 46 Table of Contents Cost of Preservation Services Year Ended December 31, 2025 2024 Cost of preservation services $ 44,322 $ 40,371 Cost of preservation services increased 10% for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
Revenues from tissue processing increased 6% for the year ended December 31, 2024, as compared to the year ended December 31, 2023. The increase in revenues was primarily due to an increase in average sales prices.
This increase was primarily due to an increase in volume of units sold. Constant currency revenues from the sales of aortic stent grafts increased 27% for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
Excluding the effects of foreign exchange, revenues increased 9% for the year ended December 31, 2024, as compared to the year ended December 31, 2023.
Revenues from the sales of surgical sealants increased 4% for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
The increase in revenues in EMEA for the year ended December 31, 2024 was primarily due to an increase in unit sales in direct markets. Domestic revenues from surgical sealants accounted for 47% and 48% of total surgical sealant revenues for the year ended December 31, 2024 and 2023, respectively.
Constant currency revenues from the sales of surgical sealants in North America were flat for the year ended December 31, 2025, as compared to the year ended December 31, 2024. Domestic revenues from surgical sealants accounted for 46% and 47% of total surgical sealant revenues for the year ended December 31, 2025 and 2024, respectively.
As a result, all conversions after the date of the notice will be settled by delivery of shares of our common stock using Physical Settlement in accordance with the Indenture. 50 Table of Contents Cash Flows The following table summarizes cash flows from operating activities, investing activities, and financing activities for the periods indicated (in thousands): Year Ended December 31, 2024 2023 Cash flows provided by (used in): Operating activities $ 22,236 $ 18,825 Investing activities (28,188) (502) Financing activities 2,203 865 Effect of exchange rate changes on cash and cash equivalents (1,728) 401 (Decrease) increase in cash and cash equivalents $ (5,477) $ 19,589 Operating Activities Net cash provided by operating activities increased $3.4 million during the year ended December 31, 2024 compared to the year ended December 31, 2023, primarily due to an increase in cash collections resulting from a 10% increase in revenues, partially offset by higher personnel-related costs associated with an increase in headcount, an increase in cash paid for taxes, and higher inventory purchases and increased preservation costs related to the increase in revenues.
The remaining $0.5 million in aggregate principal amount of the Convertible Senior Notes were settled on July 1, 2025 resulting in the issuance of 19,605 shares of our common stock. 50 Table of Contents Cash Flows The following table summarizes cash flows from operating activities, investing activities, and financing activities for the periods indicated (in thousands): Year Ended December 31, 2025 2024 Cash flows provided by (used in): Operating activities $ 39,880 $ 22,236 Investing activities (42,041) (28,188) Financing activities 11,282 2,203 Effect of exchange rate changes on cash and cash equivalents 2,324 (1,728) Increase (decrease) in cash and cash equivalents $ 11,445 $ (5,477) Operating Activities Net cash provided by operating activities increased $17.6 million during the year ended December 31, 2025 compared to the year ended December 31, 2024, primarily due to increased profitability, an improvement in cash collections from customers, and a decrease in cash paid for taxes.
Results of Operations Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 ($ in thousands) Revenues Revenues for the Year Ended December 31, Revenues as a Percentage of Total Revenues for the Year Ended December 31, 2024 2023 Percent Change 2024 2023 Products: Aortic stent grafts $ 123,081 $ 107,469 15% 32% 31% On-X 83,982 74,528 13% 22% 21% Surgical sealants 73,898 68,016 9% 19% 19% Other 9,269 11,172 (17)% 2% 3% Total products 290,230 261,185 11% 75% 74% Preservation services 98,307 92,819 6% 25% 26% Total $ 388,537 $ 354,004 10% 100% 100% 43 Table of Contents Revenues increased 10% for the year ended December 31, 2024, as compared to the year ended December 31, 2023.
Results of Operations Year Ended December 31, 2025 Compared to Year Ended December 31, 2024 ($ in thousands) Revenues Revenues for the Year Ended December 31, Revenues as a Percentage of Total Revenues for the Year Ended December 31, 2025 2024 Percent Change 2025 2024 Products: Aortic stent grafts $ 159,371 $ 123,081 29% 36% 32% On-X 101,740 83,982 21% 23% 22% Surgical sealants 76,602 73,898 4% 17% 19% Other (1) 8,112 9,269 (12)% 2% 2% Total products 345,825 290,230 19% 78% 75% Preservation services 95,505 98,307 (3)% 22% 25% Total $ 441,330 $ 388,537 14% 100% 100% (1) 2025 Other revenue includes reduction in revenue from Italian government payback reserves of $2.3 million.
Gain from Sale of Non-Financial Assets Gain from sale of non-financial assets for the year ended December 31, 2023 consisted of the net $14.3 million received as part of the Baxter Transaction upon receipt of the PerClot PMA in May 2023.
Gain from Sale of Non-Financial Assets Gain from sale of non-financial assets for the year ended December 31, 2025 consisted of a net $7.0 million gain as part of the Baxter Transaction based on the expected achievement of Baxter’s certain cumulative worldwide net sales of PerClot.
The increase in revenues in North America for the year ended December 31, 2024 was impacted by recent gains in the market share. On-X OEM sales accounted for less than 1% of product revenues for the year ended December 31, 2024 and 2023.
The increase in revenues in North America and EMEA for the year ended December 31, 2025 was impacted by gains in market share. The increase in revenues from EMEA for the year ended December 31, 2025 was primarily due to an increase in unit sales in both indirect and direct markets.
The remaining general, administrative, and marketing expenses for the year ended December 31, 2024 increased $7.0 million as a result of higher personnel-related expenses due to an increase in headcount and $2.6 million of expenses associated with the fourth quarter cybersecurity incident.
The remaining general, administrative, and marketing expenses for the year ended December 31, 2025 increased $26.3 million as a result of investments in sales and marketing, including expenses associated with the AMDS launch in the US, investments in information technology, including $3.5 million of expenses, net of insurance recoveries of $3.2 million, associated with the 2024 cybersecurity incident, and increased non-cash stock compensation expenses.
Interest Expense Interest expense was $34.3 million and $25.3 million for the year ended December 31, 2024 and 2023, respectively.
See Part II, Item 8, Note 2 of the “Notes to Consolidated Financial Statements” for further discussion of the Baxter Transaction. Interest Expense Interest expense was $26.6 million and $34.3 million for the year ended December 31, 2025 and 2024, respectively.
Constant currency revenues from the sales of surgical sealants increased 9% for the year ended December 31, 2024, as compared to the year ended December 31, 2023. The increase in revenues was primarily due to revenue increases in EMEA, North America, and Latin America, with the most significant increase in EMEA.
The increase in revenues was primarily due to revenue increases in Latin America (“LATAM”) and Asia Pacific (“APAC”). The increase in revenues in LATAM for the year ended December 31, 2025 was primarily due to an increase in unit sales in indirect and direct markets.
The increase in interest expense for the year ended December 31, 2024, as compared to the year ended December 31, 2023, was primarily due to an increase in the interest rates and higher unused commitment fees on our new credit facilities as a result of our debt refinancing in January 2024 as well as an increase in non-cash amortization of debt discounts and debt issuance costs.
Interest expense for the year ended December 31, 2025 decreased primarily due to lower variable interest rates on our credit facilities and reduced interest expense as a result of the settlement of the Convertible Senior Notes.
While interest payments will be settled in cash, we plan to settle the $100.0 million principal outstanding on our Convertible Senior Notes due July 1, 2025 by issuing shares of our common stock. We have contingent payment obligations that include up to $100.0 million to be paid to the former shareholders of Ascyrus upon the achievement of certain milestones.
We have contingent payment obligations that include up to $100.0 million to be paid to the former shareholders of Ascyrus upon the achievement of certain milestones. Under the terms of the Baxter Transaction, we made a $1.5 million payment to Starch Medical, Inc. in January 2026 related to PerClot sales milestones.
Investing Activities Net cash used in investing activities was $28.2 million and $0.5 million for the year ended December 31, 2024 and 2023, respectively.
These increases were partially offset by higher inventories and deferred preservation costs to support the increase in revenues, as well as changes in the timing of interest payments on our credit facilities executed in January 2024. Investing Activities Net cash used in investing activities was $42.0 million and $28.2 million for the year ended December 31, 2025 and 2024, respectively.
Gross margin as a percentage of total revenues decreased for the year ended December 31, 2024, as compared to the year ended December 31, 2023.
Revenues from tissue processing decreased 3% for the year ended December 31, 2025, as compared to the year ended December 31, 2024. The decrease in revenues was primarily due to a backlog of tissues to be released for shipments as a result of the 2024 cybersecurity incident.
This increase was partially offset by an increase in the cost of certain aortic stent grafts, including an idle capacity charge resulting from the cybersecurity incident that occurred in the fourth quarter of 2024, and certain tissues shipped as well as unfavorable geography mix of On-X products and certain aortic stent grafts shipped during 2024.
The increase was partially offset by unfavorable cost of certain tissues and products shipped, an unfavorable mix of tissues shipped, and an increase in our reserves related to the Italian payback measure, as compared to the year ended December 31, 2024.
Constant currency revenues from the sales of aortic stent grafts increased 13% for the year ended December 31, 2024, as compared to the year ended December 31, 2023. Revenues for the year ended December 31, 2024 increased primarily in Europe, the Middle East, and Africa (collectively, “EMEA”) and, to a lesser extent, in Latin America and Asia Pacific (“APAC”).
Revenues for the year ended December 31, 2025 increased in all geographies, with the most significant increases in Europe, the Middle East, and Africa (collectively, “EMEA”) and North America.
The decrease in other revenues for the year ended December 31, 2024 was primarily due to an decrease in PerClot product revenues and, to a lesser extent, a decrease in CardioGenesis revenues as a result of our abandonment of the CardioGenesis cardiac laser therapy business as of June 30, 2023, partially offset by an increase in PhotoFix revenues due to a change in mix of units sold and an increase in average sales prices.
The increase in revenues in LATAM and APAC for the year ended December 31, 2025 were partially offset by a revenue decrease in EMEA, which was primarily due to a decrease in unit sales in direct markets.
Removed
This increase was primarily due to a change in the volume and mix of units sold, and to a lesser extent, an increase in average sales prices, and the effect of foreign exchange rates.
Added
These changes could result in additional cost of preservation services expense or could increase per tissue preservation costs, which would impact gross margins on tissue preservation services in future periods. 42 Table of Contents We regularly evaluate our deferred preservation costs to determine if the costs are appropriately recorded at the lower of cost or net realizable value.
Removed
On July 28, 2021 we entered into an asset purchase agreement, TMSA, and other ancillary agreements related to the sale of PerClot, a polysaccharide hemostatic agent used in surgery, to a subsidiary of Baxter International, Inc. (“Baxter”), and an agreement to terminate all of our material agreements with Starch Medical, Inc. (“SMI”) related to PerClot (collectively the “Baxter Transaction”).
Added
We used a discount rate of approximat ely 16% a nd estimated future achievement of milestone dates between 2025 and 2026 to calculate the fair value of contingent consideration as of December 31, 2025.
Removed
On May 23, 2023 the FDA granted Premarket Approval (“PMA”) of PerClot for use to control bleeding in certain open and laparoscopic surgical procedures.
Added
A detailed discussion of the changes in product revenues and preservation services revenues for the year ended December 31, 2025 is presented below. Products Revenues from products increased 19% for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
Removed
Pursuant to the terms of the TMSA of the Baxter Transaction, we transferred the ownership of the PMA to Baxter following approval and began manufacturing and supplying PerClot for Baxter for a period of 21 months, subject to short-term renewal provisions. Preservation Services Preservation services include service revenues from processing cardiac and vascular tissues.

… 24 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

2 edited+0 added−0 removed6 unchanged
Biggest changeAssuming a hypothetical 10% change to the foreign currency exchange rates in effect as of December 31, 2024 on our operating results, intercompany trade, and certain intercompany loan and interest balances, our pre-tax operating results would decrease by an estimated $8.0 million over a twelve-month period. 52 Table of Contents
Biggest changeAssuming a hypothetical 10% adverse change to the foreign currency exchange rates in effect as of December 31, 2025 on our operating results, intercompany trade, and certain intercompany loan and interest balances, our pre-tax operating results would decrease by an estimated $8.0 million over a twelve-month period. 52 Table of Contents
Assuming a hypothetical increase of one percentage point in interest rates on our variable rate debt portfolio, cash equivalents, and investments as of December 31, 2024, our pre-tax operating results would decrease by an estimated $2.0 million over a twelve-month period.
Assuming a hypothetical increase of one percentage point in interest rates on our variable rate debt portfolio, cash equivalents, and investments as of December 31, 2025, our pre-tax operating results would decrease by an estimated $2.0 million over a twelve-month period.

Other AORT 10-K year-over-year comparisons