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What changed in Bioventus Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Bioventus 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.

+563 added−522 removedSource: 10-K (2026-03-05) vs 10-K (2025-03-11)

Top changes in Bioventus Inc.'s 2025 10-K

563 paragraphs added · 522 removed · 410 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

80 edited+15 added−9 removed204 unchanged
Biggest changeOur portfolio of products is comprised of five patient-focused areas, grouped into three businesses based on clinical use: (i) Pain Treatments, (ii) Surgical Solutions and (iii) Restorative Therapies. • Pain Treatments, comprised of: ◦ Knee Osteoarthritis (“KOA”) area : Our product portfolio includes a range of intra-articular, hyaluronic acid (“HA”) injections that help relieve patient discomfort and improve quality of life. ◦ Peripheral Nerve Stimulation (“PNS”) area: We are focused on developing a full portfolio of peripheral nerve stimulation products with solutions for acute, temporary and chronic pain. • Surgical Solutions, comprised of: ◦ Ultrasonics: Our Ultrasonics business offers precision bone resection for patients with degenerative spine conditions and spinal deformities.
Biggest changeOur portfolio of products is comprised of five patient-focused areas, grouped into three businesses based on clinical use: (i) Pain Treatments & PRP (“Pain Treatments”), (ii) Surgical Solutions and (iii) Restorative Therapies. • Pain Treatments , consisting of: ◦ Knee Osteoarthritis (“KOA”) : Our product portfolio includes a range of intra-articular, hyaluronic acid (“HA”) injections that help relieve patient discomfort and improve quality of life.
Manufacturers are required to take FSCAs defined as any corrective action for technical or medical reasons to prevent or reduce a risk of a serious incident associated with the use of a medical device that is made available on the market. An FSCA may include the recall, modification, exchange, destruction or retrofitting of the device.
Manufacturers are required to take FSCAs defined as any corrective action for technical or medical reasons to prevent or reduce the risk of a serious incident associated with the use of a medical device that is made available on the market. An FSCA may include the recall, modification, exchange, destruction or retrofitting of the device.
The new regulation among other things: • strengthens the rules on placing devices on the market (e.g., reclassification of certain devices and wider scope than the EU Medical Devices Directive) and reinforces surveillance once they are available; • establishes explicit provisions on manufacturers’ responsibilities for the follow-up of the quality, performance and safety of devices placed on the market; • establishes explicit provisions on importers’ and distributors’ obligations and responsibilities; • imposes an obligation to identify a responsible person who is ultimately responsible for all aspects of compliance with the requirements of the new regulation; • improves the traceability of medical devices throughout the supply chain to the end-user or patient through the introduction of a unique identification number, to increase the ability of manufacturers and regulatory authorities to trace specific devices through the supply chain and to facilitate the prompt and efficient recall of medical devices that have been found to present a safety risk; • sets up a central database (“Eudamed”) to provide patients, healthcare professionals and the public with comprehensive information on products available in the EU; and • strengthens rules for the assessment of certain high-risk devices, such as implants, which may have to undergo a clinical evaluation consultation procedure by experts before they are placed on the market.
Among other things, the new regulation does the following: • strengthens the rules on placing devices on the market (e.g., reclassification of certain devices and wider scope than the EU Medical Devices Directive) and reinforces surveillance once they are available; • establishes explicit provisions on manufacturers’ responsibilities for the follow-up of the quality, performance and safety of devices placed on the market; • establishes explicit provisions on importers’ and distributors’ obligations and responsibilities; • imposes an obligation to identify a responsible person who is ultimately responsible for all aspects of compliance with the requirements of the new regulation; • improves the traceability of medical devices throughout the supply chain to the end-user or patient through the introduction of a unique identification number, to increase the ability of manufacturers and regulatory authorities to trace specific devices through the supply chain and to facilitate the prompt and efficient recall of medical devices that have been found to present a safety risk; • sets up a central database (“Eudamed”) to provide patients, healthcare professionals and the public with comprehensive information on products available in the EU; and • strengthens rules for the assessment of certain high-risk devices, such as implants, which may undergo a clinical evaluation consultation procedure by experts before they are placed on the market.
By way of example, the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (“MMA”), requires that manufacturers report data to CMS on pricing of covered drugs reimbursed under Medicare Part B. These are generally drugs and biologicals, such as injectable products, that are administered “incident to” a physician service and in general are not self-administered.
By way of example, the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (“MMA”), requires that manufacturers report data to CMS on pricing of covered drugs reimbursed under Medicare Part B. These are generally drugs and biologicals, such as injectable products, which are administered “incident to” a physician service and in general are not self-administered.
These include: • establishment registration and device listing with the FDA; • QSR requirements, which require manufacturers, including third-party manufacturers, to follow stringent design, testing, control, documentation and other quality assurance procedures during all aspects of the design and manufacturing process; • labeling and marketing regulations, which require that promotion is truthful, not misleading, fairly balanced and provides adequate directions for use and that all claims are substantiated, and also prohibit the promotion of products for unapproved or “off-label” uses and impose other restrictions on labeling; FDA guidance on off-label dissemination of information and responding to unsolicited requests for information; • clearance or approval of product modifications to 510(k)-cleared devices that could significantly affect safety or effectiveness or that would constitute a major change in intended use of one of our cleared devices; • medical device reporting regulations, which require that a manufacturer report to the FDA if a device it markets may have caused or contributed to a death or serious injury, or has malfunctioned and the device or a similar device that it markets would be likely to cause or contribute to a death or serious injury, if the malfunction were to recur; • correction, removal and recall reporting regulations, which require that manufacturers report to the FDA field corrections and product recalls or removals if undertaken to reduce a risk to health posed by the device or to remedy a violation of the FDCA that may present a risk to health; • complying with requirements governing Unique Device Identifiers on devices and also requiring the submission of certain information about each device to the FDA’s Global Unique Device Identification Database; • the FDA’s recall authority, whereby the agency can order device manufacturers to recall from the market a product that is in violation of governing laws and regulations; and • post-market surveillance activities and regulations, which apply when the FDA deems them necessary to protect the public health or to provide additional safety and effectiveness data for the device. 10 Table of Contents HCT/Ps Certain of our products are regulated as “HCT/P”, which is an acronym for human cell, tissue, and cellular and tissue-based products.
These include: • establishment registration and device listing with the FDA; • QSR requirements, which require manufacturers, including third-party manufacturers, to follow stringent design, testing, control, documentation and other quality assurance procedures during all aspects of the design and manufacturing process; • labeling and marketing regulations, which require that promotion is truthful, not misleading, fairly balanced and provides adequate directions for use and that all claims are substantiated, and also prohibit the promotion of products for unapproved or “off-label” uses and impose other restrictions on labeling; FDA guidance on off-label dissemination of information and responding to unsolicited requests for information; • clearance or approval of product modifications to 510(k)-cleared devices that could significantly affect safety or effectiveness or that would constitute a major change in intended use of one of our cleared devices; • medical device reporting regulations, which require that a manufacturer report to the FDA if a device it markets may have caused or contributed to a death or serious injury, or has malfunctioned and the device or a similar device that it markets would be likely to cause or contribute to a death or serious injury, if the malfunction were to recur; • correction, removal and recall reporting regulations, which require that manufacturers report to the FDA field corrections and product recalls or removals if undertaken to reduce the risk to health posed by the device or to remedy a violation of the FDCA that may present a risk to health; • complying with requirements governing Unique Device Identifiers on devices and also requiring the submission of certain information about each device to the FDA’s Global Unique Device Identification Database; • the FDA’s recall authority, whereby the agency can order device manufacturers to recall from the market a product that is in violation of governing laws and regulations; and • post-market surveillance activities and regulations, which apply when the FDA deems them necessary to protect the public health or to provide additional safety and effectiveness data for the device. 10 Table of C o ntents HCT/Ps Certain of our products are regulated as “HCT/P”, which is an acronym for human cell, tissue, and cellular and tissue-based products.
Other internal or governmental investigations or legal or regulatory proceedings, including lawsuits brought by private litigants, may also follow as a consequence. We are also subject to the United Kingdom and Brazilian equivalents, the United Kingdom Bribery Act and the Brazil Clean Company Act.
Other internal or governmental investigations or legal or regulatory proceedings, including lawsuits brought by private litigants, may also follow as a consequence. We are also subject to other jurisdictions including the United Kingdom and Brazilian equivalents, the United Kingdom Bribery Act and the Brazil Clean Company Act.
The process required by the FDA before a drug or biologic may be marketed in the United States generally involves the following: • completion of preclinical laboratory tests and animal studies performed in accordance with the FDA’s Good Laboratory Practice requirements; • submission to the FDA of an IND, which must become effective before clinical trials may begin; • approval by an IRB or ethics committee at each clinical site before the trial is commenced; • performance of adequate and well-controlled human clinical trials to establish the safety, efficacy, purity and potency of the proposed product candidate for its intended purpose; • preparation of and submission to the FDA of a BLA for biologics or New Drug Application (“NDA”) for small molecule drugs after completion of all pivotal clinical trials; • satisfactory completion of an FDA Advisory Committee review, if applicable; • a determination by the FDA within 60 days of its receipt of a BLA or NDA to file the application for review; • satisfactory completion of an FDA pre-approval inspection of the manufacturing facility or facilities at which the proposed product is produced to assess compliance with cGMPs and to assure that the facilities, methods and controls are adequate to preserve the biological product’s continued safety, purity and potency, and of selected clinical investigation sites to assess compliance with Good Clinical Practices (“GCPs”); and • FDA review and approval of the BLA or NDA to permit commercial marketing of the product for particular indications for use in the United States. 11 Table of Contents Prior to beginning clinical trials of a new drug or biologic product in the United States, an IND must be submitted to the FDA.
The process required by the FDA before a drug or biologic may be marketed in the United States generally involves the following: • completion of preclinical laboratory tests and animal studies performed in accordance with the FDA’s Good Laboratory Practice requirements; • submission to the FDA of an IND, which must become effective before clinical trials may begin; • approval by an IRB or ethics committee at each clinical site before the trial is commenced; • performance of adequate and well-controlled human clinical trials to establish the safety, efficacy, purity and potency of the proposed product candidate for its intended purpose; • preparation of and submission to the FDA of a BLA for biologics or New Drug Application (“NDA”) for small molecule drugs after completion of all pivotal clinical trials; • satisfactory completion of an FDA Advisory Committee review, if applicable; • a determination by the FDA within 60 days of its receipt of a BLA or NDA to file the application for review; • satisfactory completion of an FDA pre-approval inspection of the manufacturing facility or facilities at which the proposed product is produced to assess compliance with cGMPs and to assure that the facilities, methods and controls are adequate to preserve the biological product’s continued safety, purity and potency, and of selected clinical investigation sites to assess compliance with Good Clinical Practices (“GCPs”); and • FDA review and approval of the BLA or NDA to permit commercial marketing of the product for particular indications for use in the United States. 11 Table of C o ntents Prior to beginning clinical trials of a new drug or biologic product in the United States, an IND must be submitted to the FDA.
The neXus platform is driven by a proprietary digital algorithm designed to deliver more power, efficiency, and control for the surgeon. The device incorporates technology that allows for intuitive set-up and use.
The neXus platform is driven by a proprietary digital algorithm designed to deliver power, efficiency, and control for the surgeon. The device incorporates technology that allows for intuitive set-up and use.
These agreements further restrict the use and disclosure of Bioventus’ confidential information and proprietary information belonging to any third party. These agreements further prohibit our employees from using, disclosing, or bringing onto the premises any proprietary information belonging to any third party.
These agreements further restrict the use and disclosure of our confidential information and proprietary information belonging to any third party. These agreements further prohibit our employees from using, disclosing, or bringing onto the premises any proprietary information belonging to any third party.
An IND is a request for authorization from the FDA to administer an investigational new drug product to humans. An IND must become effective before human clinical trials may begin.
An IND is a request for authorization from the FDA to administer an investigational new drug product to humans. An IND must become effective before human clinical trials begin.
In certain countries, the health care professionals we or our distributors regularly interact with may meet the definition of a foreign government official for the purposes of the FCPA.
In certain countries, the health care professionals with whom we or our distributors regularly interact may meet the definition of a foreign government official for the purposes of the FCPA.
The amended Article 120(2), the extension of validity for these devices will, however, apply only if one of the following conditions is met: (i) The manufacturer has signed a written agreement with a Notified Body for the conformity assessment of the device in question at the moment of expiry, (ii) a national competent authority has granted a derogation from the applicable conformity assessment procedure in accordance with Article 59 of the MDR; or (iii) a national competent authority has required the manufacturer to carry out the conformity assessment procedure within a specific time period in accordance with Article 97 of the MDR. 14 Table of Contents The EU Medical Devices Regulation requires that before placing a device, other than a custom-made device, on the market, manufacturers (as well as other economic operators such as authorized representatives and importers) must register by submitting identification information to Eudamed, unless they have already registered.
The amended Article 120(2), the extension of validity for these devices will, however, apply only if one of the following conditions is met: (i) The manufacturer has signed a written agreement with a Notified Body for the conformity assessment of the device in question at the moment of expiry, (ii) a national competent authority has granted a derogation from the applicable conformity assessment procedure in accordance with Article 59 of the MDR; or (iii) a national competent authority has required the manufacturer to carry out the conformity assessment procedure within a specific time period in accordance with Article 97 of the MDR. 14 Table of C o ntents The EU Medical Devices Regulation requires that before placing a device, other than a custom-made device, on the market, manufacturers (as well as other economic operators such as authorized representatives and importers) must register by submitting identification information to Eudamed, unless they have already registered.
Durolane’s injection schedule results in economic advantages and greater patient convenience and compliance compared to other HA viscosupplementation therapies which require weekly injections over a period of three to five weeks. Durolane is highly purified and based upon a natural and patented non-animal stabilized HA (“NASHA”), expanding use to patients who are allergic to animal-derived solutions.
Durolane’s injection schedule results in economic advantages and greater patient convenience and compliance compared to other HA viscosupplementation therapies which require weekly injections over a period of three to five weeks. Durolane is highly purified and based upon a natural and patented non-animal stabilized HA, expanding its use to patients who are allergic to animal-derived solutions.
FCA liability can include three times the amount of damages sustained by the government due to the fraudulent activity, possible civil monetary penalties up to $23,331 (adjusted annually for inflation) per claim, exclusion from participating in federal healthcare programs, and possible criminal charges, resulting in additional fines and imprisonment. 16 Table of Contents Further, the Civil Monetary Penalties Statute authorizes the imposition of civil monetary penalties, assessments, and exclusion against an individual or entity based on a variety of prohibited conduct, including, but not limited to offering remuneration to a federal healthcare program beneficiary that the individual or entity knows or should know is likely to influence the beneficiary to order or receive healthcare items or services from a particular provider (also known as “beneficiary inducements”).
FCA liability can include three times the amount of damages sustained by the government due to the fraudulent activity, possible civil monetary penalties up to $23,331 (adjusted annually for inflation) per claim, exclusion from participating in federal healthcare programs, and possible criminal charges, resulting in additional fines and imprisonment. 16 Table of C o ntents Further, the Civil Monetary Penalties Statute authorizes the imposition of civil monetary penalties, assessments, and exclusion against an individual or entity based on a variety of prohibited conduct, including, but not limited to offering remuneration to a federal healthcare program beneficiary that the individual or entity knows or should know is likely to influence the beneficiary to order or receive healthcare items or services from a particular provider (also known as “beneficiary inducements”).
Under this approach, the FDA indicated that high-risk products and uses could be subject to immediate enforcement action. In July 2020, the FDA extended its period of enforcement discretion to May 31, 2021. The FDA resumed enforcement of IND and premarket approval requirements with respect to these products as of June 1, 2021.
Under this approach, the FDA indicated that high-risk products and uses could be subject to immediate enforcement action. In July 2020, the FDA extended its period of enforcement discretion to May 31, 2021. The FDA resumed enforcement of IND and premarket approval requirements with respect to these products as of June 1, 2021. U.S.
In connection with the IPO and the UP-C structure, we completed a series of organizational transactions including, without limitation, the following: • the limited liability company agreement of BV LLC was amended and restated (“Bioventus LLC Agreement”) to, among other things, (i) provide for a new single class of common membership interests in BV LLC (“LLC Interests”), (ii) exchange all of the then existing membership interests of the holders of BV LLC membership interests (“Original LLC Owners”) for LLC Interests and (iii) appoint Bioventus Inc. as the sole managing member of BV LLC; and • the acquisition, by merger, of certain members of BV LLC (“Former LLC Owners”), for which we issued shares of Class A common stock as merger consideration (“Merger”). • We amended and restated our certificate of incorporation to authorize Class A common stock, Class B common stock and undesignated preferred stock.
In connection with the IPO and the UP-C structure, we completed a series of organizational transactions including, without limitation, the following: • the limited liability company agreement of BV LLC was amended and restated (“Bioventus LLC Agreement”) to, among other things, (i) provide for a new single class of common membership interests in BV LLC (“LLC Interests”), (ii) exchange all of the then-existing membership interests of the holders of BV LLC membership interests (“Original LLC Owners”) for LLC Interests, and (iii) appoint Bioventus Inc. as the sole managing member of BV LLC; • the acquisition, by merger, of certain members of BV LLC (“Former LLC Owners”), for which we issued shares of Class A common stock as merger consideration (“Merger”); and 19 Table of C o ntents • we amended and restated our certificate of incorporation to authorize Class A common stock, Class B common stock and undesignated preferred stock.
Possible reductions in, or eliminations of, coverage or reimbursement by third-party payors, or denial of, or provision of uneconomical reimbursement for new products may affect our customers’ revenue and ability to purchase our products. Any changes in the healthcare regulatory, payment or enforcement landscape relative to our customers’ healthcare services have the potential to significantly affect our operations and revenue.
Possible reductions in, or eliminations of, coverage or reimbursement by third-party payers, or denial of, or provision of uneconomical reimbursement for new products may affect our customers’ revenue and ability to purchase our products. Any changes in the healthcare regulatory, payment or enforcement landscape relative to our customers’ healthcare services have the potential to significantly affect our operations and revenue.
This may improve joint function and help to potentially avoid or delay knee replacement surgery. Physicians administer Durolane to the affected knee joint in a single injection and it has been observed to provide a benefit for pain reduction in patients with OA in the knee for up to 26 weeks.
This may improve joint function and help to potentially delay knee replacement surgery. Physicians administer Durolane to the affected knee joint in a single injection and it has been observed to provide a benefit for pain reduction in patients with OA in the knee for up to 26 weeks.
We will continue to seek patent, trademark, and copyright protection as we deem advisable to protect the markets for our products and to support our research and development efforts. Manufacturing and supply We largely manufacture and assemble our medical device products at our production facility located in Cordova, Tennessee.
We will continue to seek patent, trademark, and copyright protection as we deem advisable to protect the markets for our products and to support our research and development efforts. Manufacturing and Supply We mostly manufacture and assemble our medical device products at our production facility located in Cordova, Tennessee.
In the event of either of these occurrences, we could be instructed to recall products, cease distribution and/or be subject to civil or criminal penalties. 15 Table of Contents Anti-kickback Statute, False Claims Act and other healthcare laws We are subject to a number of U.S. laws regulating healthcare fraud, waste, and abuse (“FWA”) including without limitation the federal Anti-Kickback Statute (“AKS”) and the federal Physician Self-Referral Law (known as the Stark Law), the Civil False Claims Act, the civil prohibition on beneficiary inducements, and the Health Insurance Portability and Accountability Act of 1996, as amended (“HIPAA”), as well as numerous state laws and regulations regarding healthcare and insurance services.
In the event of either of these occurrences, we could be instructed to recall products, cease distribution and/or be subject to civil or criminal penalties. 15 Table of C o ntents Anti-kickback Statute, False Claims Act and Other Healthcare Laws We are subject to a number of U.S. laws regulating healthcare fraud, waste, and abuse (“FWA”) including without limitation the federal Anti-Kickback Statute (“AKS”) and the federal Physician Self-Referral Law (known as the Stark Law), the Civil False Claims Act, the civil prohibition on beneficiary inducements, and the Health Insurance Portability and Accountability Act of 1996, as amended (“HIPAA”), as well as numerous state laws and regulations regarding healthcare and insurance services.
If the device presents a non-significant risk to the patient, a sponsor may begin the clinical trial after obtaining approval for the trial by one or more IRBs without separate approval from the FDA, but must still follow abbreviated IDE requirements, such as monitoring the investigation, ensuring that the investigators obtain informed consent, and labeling and record-keeping requirements. 9 Table of Contents In addition to clinical and preclinical data, the PMA must contain a full description of the device and its components, a full description of the methods, facilities, and controls used for manufacturing, and proposed labeling.
If the device presents a non-significant risk to the patient, a sponsor may begin the clinical trial after obtaining approval for the trial by one or more IRBs without separate approval from the FDA, but must still follow abbreviated IDE requirements, such as monitoring the investigation, ensuring that the investigators obtain informed consent, and labeling and record-keeping requirements. 9 Table of C o ntents In addition to clinical and preclinical data, the PMA must contain a full description of the device and its components, a full description of the methods, facilities, and controls used for manufacturing, and proposed labeling.
GELSYN-3 is derived from bacterial fermentation, is highly purified and does not involve the use of animal products, thereby reducing the potential risk of an immune response following injection. We currently market GELSYN-3 in the United States. 2 Table of Contents SUPARTZ is an FDA-approved sterile and viscoelastic solution of HA that is administered as a five-injection HA viscosupplementation therapy.
GELSYN-3 is derived from bacterial fermentation, is highly purified and does not involve the use of animal products, thereby reducing the potential risk of an immune response following injection. We currently market GELSYN-3 in the United States. SUPARTZ is an FDA-approved sterile and viscoelastic solution of HA that is administered as a five-injection HA viscosupplementation therapy.
Some of our products and product components are manufactured exclusively by single-source third-party manufacturers, pursuant to multi-year supply agreements that may include minimum order volumes. We work closely with each of our manufacturing partners and provide them with a forecast, which enables them to better capacity plan and sequence their production efficiently.
Some of our products and product components are manufactured exclusively by single-source third-party manufacturers, pursuant to multi-year supply agreements that may include minimum order volumes. We work closely with each of our manufacturing partners and provide them with forecasts, which enables them to have a better capacity plan and sequence their production efficiently.
Other potential consequences include, among other things: complete withdrawal of the product from the market, product recalls, fines, warning letters, untitled letters, clinical holds on clinical studies, refusal of the FDA to approve pending applications or supplements to approved applications, product seizures or detention, refusal to permit the import or export of products, consent decrees, corporate integrity agreements, debarment or exclusion from federal healthcare programs, the issuance of corrective information, injunctions, or the imposition of civil or criminal penalties. 12 Table of Contents In addition, the FDA closely regulates the marketing, labeling, advertising and promotion of drugs, biologics (including Section 361 HCT/Ps) and medical devices.
Other potential consequences include, among other things: complete withdrawal of the product from the market, product recalls, fines, warning letters, untitled letters, clinical holds on clinical studies, refusal of the FDA to approve pending applications or supplements to approved applications, product seizures or detention, refusal to permit the import or export of products, consent decrees, corporate integrity agreements, debarment or exclusion from federal healthcare programs, the issuance of corrective information, injunctions, or the imposition of civil or criminal penalties. 12 Table of C o ntents In addition, the FDA regulates the marketing, labeling, advertising and promotion of drugs, biologics (including Section 361 HCT/Ps) and medical devices.
We manage our business through two reporting segments, U.S. and International, which accounted for 88% and 12%, respectively, of our total net sales during the fiscal year ended December 31, 2024.
We manage our business through two reporting segments, U.S. and International, which accounted for 88% and 12%, respectively, of our total net sales during the fiscal year ended December 31, 2025.
The FCPA prohibits U.S. companies and their representatives from processing, offering, or making payments of money or anything of value to foreign officials with the intent to obtain or retain business or seek a business advantage.
The FCPA prohibits U.S. companies and their representatives from promising, offering, or making payments of money or anything of value to foreign officials with the intent to obtain or retain business or seek a business advantage.
Singleton 56 Senior Vice President and Chief Financial Officer Anthony D’Adamio 64 Senior Vice President and General Counsel Katrina Church 63 Senior Vice President and Chief Compliance Officer Robert Claypoole joined Bioventus in January 2024 as President and Chief Executive Officer and as a member of the Board of Directors from Mölnlycke Health Care (“Mölnlycke”), a world-leading medical products and solutions company, where he served as Executive Vice President of Wound Care since July 2021.
Singleton 57 Senior Vice President and Chief Financial Officer Anthony D’Adamio 65 Senior Vice President and General Counsel Katrina Church 64 Senior Vice President and Chief Compliance Officer Robert Claypoole joined Bioventus in January 2024 as President and Chief Executive Officer and as a member of the Board of Directors from Mölnlycke Health Care (“Mölnlycke”), a world-leading medical products and solutions company, where he served as Executive Vice President of Wound Care since July 2021.
Reimbursement from Medicare, Medicaid and other third-party payors may be subject to periodic adjustments as a result of legislative, regulatory and policy changes, as well as budgetary pressures.
Reimbursement from Medicare, Medicaid and other third-party payers may be subject to periodic adjustments as a result of legislative, regulatory and policy changes, as well as budgetary pressures.
Our patents and pending patent applications directed to our material products are further detailed in Exhibit 99.1 to this Annual Report. 7 Table of Contents Trademarks We own registered trademarks for Bioventus, BoneScalpel, BoneScalpel Access, Durolane, EXOGEN, GELSYN-3, Misonix, neXus, OSTEOAMP, Osteofuse, PureBone, SIGNAFUSE, Sonastar, SonaStar Elite, SonicOne, TalisMann and StimRouter in the United States.
Our patents and pending patent applications directed to our material products are further detailed in Exhibit 99.1 to this Annual Report. 7 Table of C o ntents Trademarks We own registered trademarks for Bioventus, BoneScalpel, BoneScalpel Access, Durolane, EXOGEN, GELSYN-3, Misonix, neXus, OSTEOAMP, Osteofuse, PureBone, SIGNAFUSE, Sonastar, SonaStar Elite, SonicOne, TalisMann and StimRouter in the United States.
We currently market SonaStar System and SonaStar Elite in the United States. 4 Table of Contents The SonicOne Ultrasonic Cleansing and Debridement System is a highly innovative, tissue-specific approach for the removal of devitalized or necrotic tissue and fibrin deposits while sparing viable, surrounding cellular structures.
We currently market SonaStar System and SonaStar Elite in the United States. The SonicOne Ultrasonic Cleansing and Debridement System is a highly innovative, tissue-specific approach for the removal of devitalized or necrotic tissue and fibrin deposits while sparing viable, surrounding cellular structures.
This portfolio also enables precision ultrasonic neuro and general surgery to address brain tumors and pathologies of the liver and other organs. ◦ Bone Graft Substitutes (“BGS”) : Our product portfolio includes a range of products that facilitate optimal bone fusion following a surgical procedure. • Restorative Therapies, comprised of: ◦ Fracture Care: We provide low-intensity pulse ultrasound to help patients who suffer from bone fractures that do not heal through traditional methods.
This portfolio also enables precision bone cutting in ultrasonic neuro and general surgery to address brain tumors and pathologies of the liver and other organs. ◦ Bone Graft Substitutes (“BGS”) : Our BGS product portfolio includes a range of products that facilitate optimal bone fusion following a surgical procedure. • Restorative Therapies , consisting of: ◦ Fracture Care: We provide low-intensity pulse ultrasound to help patients who suffer from bone fractures that do not heal through traditional methods.
There are also harmonized standards relating to design and manufacture. While not mandatory, compliance with these standards is viewed as the easiest way to satisfy the essential requirements as a practical matter as it creates a rebuttable presumption that the device satisfies that essential requirement.
There are also harmonized standards relating to design and manufacture. While not mandatory, compliance with these standards is viewed as the easiest way to satisfy the essential requirements because it creates a rebuttable presumption that the device satisfies that essential requirement.
All tissues are screened for the standard panel of infectious viruses. We currently market PUREBONE in the United States. 5 Table of Contents Reficio Demineralized Bone Matrix (“Reficio DBM”) is a putty comprised of human demineralized bone matrix and a biocompatible, bioabsorbable carrier, carboxymethylcellulose, mixed into a putty-like consistency for ease of use during surgery.
All tissues are screened for the standard panel of infectious viruses. We currently market PUREBONE in the United States. 5 Table of C o ntents Reficio Demineralized Bone Matrix (“Reficio DBM”) is a putty comprised of human demineralized bone matrix and a biocompatible, bioabsorbable carrier, carboxymethylcellulose, mixed into a putty-like consistency for ease of use during surgery.
Singleton received his Bachelor of Science from Purdue University and his Master of Business Administration from Duke University, Fuqua School of Business. 20 Table of Contents Anthony D’Adamio has served as our Senior Vice President and General Counsel since August 2017. Previously, Mr.
Singleton received his Bachelor of Science from Purdue University and his Master of Business Administration from Duke University, Fuqua School of Business. Anthony D’Adamio has served as our Senior Vice President and General Counsel since August 2017. Previously, Mr.
U.S. regulation of drugs and biological products In the United States, the FDA regulates drugs under the FDCA and its implementing regulations, and biologics under the FDCA and the PHSA and their implementing regulations.
Regulation of Drugs and Biological Products In the United States, the FDA regulates drugs under the FDCA and its implementing regulations, and biologics under the FDCA and the PHSA and their implementing regulations.
Privacy and data security laws, regulations, and other obligations are constantly evolving, may conflict with each other to complicate compliance efforts, and can result in investigations, proceedings, or actions that lead to significant civil and/or criminal penalties and restrictions on data processing. 18 Table of Contents Coverage and reimbursement Our products may be reimbursed by third-party payors, such as government programs, including Medicare and Medicaid, or private insurance plans and healthcare networks.
Privacy and data security laws, regulations, and other obligations are constantly evolving, may conflict with each other to complicate compliance efforts, and can result in investigations, proceedings, or actions that lead to significant civil and/or criminal penalties and restrictions on data processing. 18 Table of C o ntents Coverage and Reimbursement Our products may be reimbursed by third-party payers, such as government programs, including Medicare and Medicaid, or private insurance plans and healthcare networks.
Food & Drug Administration-approved, sterile, transparent and viscoelastic gel that is a single injection therapy that is indicated in the United States for the symptomatic treatment of osteoarthritis (“OA”) in the knee in patients who have failed to respond adequately to conservative non-pharmacological therapy and simple analgesics.
Durolane is an U.S. Food & Drug Administration-approved, sterile, transparent and viscoelastic gel that is a single injection therapy that is indicated in the United States for the symptomatic treatment of osteoarthritis (“OA”) in the knee in patients who have failed to respond adequately to conservative non-pharmacological therapy and simple analgesics.
Our SUPARTZ FX, GELSYN-3 and Durolane products are reimbursed under Medicare Part B and, as a result, we provide ASP data on these products to CMS on a quarterly basis. 17 Table of Contents Foreign Corrupt Practices Act We are subject to the Foreign Corrupt Practices Act of 1977, as amended (“FCPA”).
Our SUPARTZ FX, GELSYN-3 and Durolane products are reimbursed under Medicare Part B and, as a result, we provide ASP data on these products to CMS on a quarterly basis. 17 Table of C o ntents Foreign Corrupt Practices Act We are subject to the Foreign Corrupt Practices Act of 1977, as amended (“FCPA”).
The U.S. patents are expected to expire between 2025 and 2029, and the foreign patent is expected to expire in 2025. We own two issued U.S. patents, and 18 issued foreign patents directed to our OSTEOAMP product, including foreign patents in Europe, Asia, Canada and Australia. The issued U.S. patents are expected to expire in 2029.
The U.S. patents are expected to expire between 2028 and 2029, and the foreign patent is expected to expire in 2026. We own two issued U.S. patents, and 18 issued foreign patents directed to our OSTEOAMP product, including foreign patents in Europe, Asia, Canada and Australia. The issued U.S. patents are expected to expire in 2029.
The tissue-specific capability is, in part, due to healthy and viable tissue structures’ higher elasticity and flexibility than necrotic tissue and resistance to destruction from the impact effects of ultrasound. The ultrasonic debridement process separates devitalized tissue from viable tissue layers, allowing for a more defined treatment and, usually, a reduced pain sensation.
The tissue-specific capability is, in part, due to healthy and viable tissue structures’ higher elasticity and flexibility than necrotic tissue and resistance to destruction from the impact effects of ultrasound. The ultrasonic debridement process separates devitalized tissue from viable tissue layers, allowing for a more defined treatment.
As a result, demand for our products is and will continue to be dependent in part on the coverage and reimbursement policies of these payors. The manner in which reimbursement is sought and obtained varies based upon the type of payor involved and the setting in which the product is furnished and utilized.
As a result, demand for our products is and will continue to be dependent in part on the coverage and reimbursement policies of these payers. The manner in which reimbursement is sought and obtained varies based upon the type of payer involved and the setting in which the product is furnished and utilized.
Criminal penalties and administrative sanctions for violating the AKS include civil penalties exceeding $130,000 per violation plus three times the amount of the improper remuneration, criminal penalties up to $100,000 per violation, prison terms, and exclusion from participation in the federal health care programs.
Criminal penalties and administrative sanctions for violating the AKS include civil penalties of $127,973 per violation plus three times the amount of the improper remuneration, criminal penalties up to $100,000 per violation, prison terms, and exclusion from participation in the federal health care programs.
In addition to soft tissue applications, SonaStar may be used with hard tissue tips to enable precise shaping or shaving of bony structures that prevent access to partially or completely hidden soft tissue masses. Our SonaStar Elite handpiece and accessories expand the frequency capabilities of the neXus System, adding 36 kHz capabilities.
In addition to soft tissue applications, SonaStar may be used with hard tissue tips to enable precise shaping or shaving of bony structures that prevent access to partially or completely hidden soft tissue masses. 4 Table of C o ntents Our SonaStar Elite handpiece and accessories expand the frequency capabilities of the neXus System, adding 36 kHz capabilities.
That team is supported by a broad management team in addition to a market access team focused on expanding approvals with integrated healthcare delivery networks (“IDNs”), GPOs and payers. Internationally, we sell our products through a mix of direct and indirect sales teams and distributors.
That team is supported by a broad management team in addition to a market access team focused on expanding approvals with integrated healthcare delivery networks (“IDNs”), group purchasing organizations (“GPOs”) and payers. Internationally, we sell our products through a mix of direct and indirect sales teams and distributors.
D’Adamio holds a Juris Doctor from Howard University School of Law and a Bachelor of Arts from the State University of New York at Binghamton. Katrina Church has served as our Chief Compliance Officer since August 2020. Prior to joining us, Ms.
D’Adamio holds a Juris Doctor from Howard University School of Law and a Bachelor of Arts from the State University of New York at Binghamton. 20 Table of C o ntents Katrina Church has served as our Chief Compliance Officer since August 2020. Prior to joining us, Ms.
Developmental and clinical pipeline for Pain Treatments The TalisMann Pulse Generator and Receiver is an accessory to the StimRouter PNS system and is designed to provide more powerful stimulation to the targeted peripheral nerve, potentially enabling physicians to address chronic pain of a peripheral nerve origin in larger, deeper, or damaged nerves.
The TalisMann Pulse Generator and Receiver is an accessory to the StimRouter PNS system and is designed to provide more powerful stimulation to the targeted peripheral nerve, potentially enabling physicians to address chronic pain of a peripheral nerve origin in larger, deeper, or damaged nerves.
Information about our Executive Officers The following table sets forth information concerning our executive officers as of March 1, 2025: Name Age Position(s) Robert E. Claypoole 53 President and Chief Executive Officer Mark L.
Information about our Executive Officers The following table sets forth information concerning our executive officers as of March 1, 2026: Name Age Position(s) Robert E. Claypoole 54 President and Chief Executive Officer Mark L.
We also own two issued U.S. patents and one pending U.S. patent application, and four pending foreign patent applications directed to our TalisMann product, including foreign patent applications in Australia, Canada, Europe, and Japan. The U.S. patents are expected to expire between 2039 and 2040.
We also own three issued U.S. patents and one pending U.S. patent application, four issued foreign patents, and five pending foreign patent applications directed to our TalisMann product, including foreign patent applications in Australia, Canada, Europe, and Asia. The U.S. patents are expected to expire between 2039 and 2040.
Employee and Human Capital Resources As of December 31, 2024, we had approximately 930 employees, none of whom were covered by collective bargaining agreements. Most of these employees are located in the United States with approximately 98 located outside the United States. We believe that our relations with our employees are generally good.
Employee and Human Capital Resources As of December 31, 2025, we had approximately 930 employees, none of whom were covered by collective bargaining agreements. Most of these employees are located in the United States with approximately 94 located outside the United States. We believe that our relations with our employees are generally positive.
We plan to expand our United States clinical indications to address the healing of fresh fractures, especially for high-risk patients. Financial information regarding our reportable business segments is included in Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and Part II, Item 8.
We plan to expand our U.S. clinical fracture care indications to address the healing of additional fresh fractures, especially for high-risk patients. Financial information regarding our reportable business segments is included in Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and Part II, Item 8.
The Medicare program is expected to continue to implement a new payment mechanism for certain durable medical equipment, prosthetics, orthotics, and supplies (“DMEPOS”) items via the implementation of its competitive bidding program. Bone growth therapy devices are currently exempt from this competitive bidding process. The current federal administration has granted the U.S.
The Medicare program is expected to continue to implement a new payment mechanism for certain durable medical equipment, prosthetics, orthotics, and supplies (“DMEPOS”) items via the implementation of its competitive bidding program. Bone growth therapy devices are currently exempt from this competitive bidding process.
Physicians administer SUPARTZ FX to the affected knee joint once a week for five consecutive weeks. SUPARTZ FX may also delay the need for total knee replacement. SUPARTZ FX is derived from HA extracted from certified and veterinary inspected chicken combs. We currently market SUPARTZ FX in the United States.
Physicians administer SUPARTZ FX to the affected knee joint once a week for five consecutive weeks. SUPARTZ FX may also delay the need for total knee replacement. SUPARTZ FX is derived from HA extracted from certified and veterinary inspected chicken combs.
In particular, there will be a new audit by the notified body before it will renew the relevant certificate(s). 13 Table of Contents Medical Device Regulation The regulatory landscape related to medical devices in the EU continues to evolve.
In particular, there will be a new audit by the notified body before it renews the relevant certificate(s). 13 Table of C o ntents Medical Device Regulation The regulatory landscape related to medical devices in the EU continues to evolve.
Although in the aggregate our intellectual property is of material importance to our business, we do not believe that any single patent is of material importance to our product portfolio. As of December 31, 2024, we owned 77 issued U.S. patents and four pending U.S. patent applications relating to our material products.
Although in the aggregate our intellectual property is material to our business, we do not believe that any single patent is material to our product portfolio. As of December 31, 2025, we owned 99 issued U.S. patents and six pending U.S. patent applications relating to our material products.
The FDA regulates the development, design, non-clinical and clinical research, manufacturing, safety, efficacy, labeling, packaging, storage, installation, servicing, recordkeeping, premarket clearance or approval, adverse event reporting, advertising, promotion, marketing and distribution, and import and export of medical devices and biological products to ensure that such products distributed domestically are safe and effective for their intended uses and otherwise meet the applicable requirements of the FDCA and PHSA. 8 Table of Contents U.S. regulation of medical devices In the United States, the majority of our products are regulated as medical devices by the FDA.
The FDA regulates the development, design, non-clinical and clinical research, manufacturing, safety, efficacy, labeling, packaging, storage, installation, servicing, recordkeeping, premarket clearance or approval, adverse event reporting, advertising, promotion, marketing and distribution, and import and export of medical devices and biological products to ensure that such products distributed domestically are safe and effective for their intended uses and otherwise meet the applicable requirements of the FDCA and PHSA. 8 Table of C o ntents U.S.
We also owned 114 issued foreign patents and 21 pending foreign patent applications directed to our material products. Our patents and patent applications as of December 31, 2024 directed to our material products are summarized below. We own three issued U.S. patents and one issued foreign patent in Australia directed to our EXOGEN system.
We also owned 141 issued foreign patents and 35 pending foreign patent applications directed to our material products. Our patents and patent applications as of December 31, 2025 directed to our material products are summarized below. We own two issued U.S. patents and one issued foreign patent in Australia directed to our EXOGEN system.
Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note 14. Segments of this Annual Report. Our products are described in additional detail below under “Our products.” Our growth strategy The four-pronged strategy to reach our goals across our patient-focused areas includes the following: 1) Further develop and market our surgical solutions business .
Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note 14. Segments of this Annual Report. Our products are described in additional detail below under “Our Products.” Our Growth Strategy The four-pronged strategy to reach our goals across our patient-focused areas includes the following: 1) Strengthen our leading positions in our core markets.
The U.S. patents are expected to expire between 2025 and 2039, and the foreign patents are expected to expire between 2026 and 2038. The pending patent applications, if issued, are expected to expire between 2037 and 2038, without accounting for potential patent term extensions and adjustments.
The U.S. patents are expected to expire between 2026 and 2044, and the foreign patents are expected to expire between 2027 and 2039. The pending patent applications, if issued, are expected to expire between 2036 and 2043, without accounting for potential patent term extensions and adjustments.
Unless an exemption applies, each medical device commercially distributed in the United States requires either FDA clearance of a 510(k) premarket notification or approval of a premarket approval (“PMA”) application.
Regulation of Medical Devices In the United States, the majority of our products are regulated as medical devices by the FDA. Unless an exemption applies, each medical device commercially distributed in the United States requires either FDA clearance of a 510(k) premarket notification or approval of a premarket approval (“PMA”) application.
Regulation (EU) 2023/607 of the European Parliament and of the Council of 15 March 2023 amending Regulations (EU) 2017/745 and (EU) 2017/746 as regards the transitional provisions for certain medical devices and in vitro diagnostic medical devices.
Regulation (EU) 2023/607 of the European Parliament and of the Council of 15 March 2023 amending Regulations (EU) 2017/745 and (EU) 2017/746 regards the transitional provisions for certain medical devices and in vitro diagnostic medical devices. The Regulation introduces a staggered extension of the transition period provided for in Regulation (EU) 2017/745 on medical devices (MDR), subject to certain conditions.
Our Restorative Therapies compete with products marketed by Orthofix Medical Inc., Zimmer Biomet Holdings, Inc., Enovis and XFT Medical. We strive to protect and enhance the proprietary technologies, inventions and improvements that we believe are important to our business, including seeking, maintaining and defending patent rights, whether developed internally or licensed from third-parties.
We strive to protect and enhance the proprietary technologies, inventions and improvements that we believe are important to our business, including seeking, maintaining and defending patent rights, whether developed internally or licensed from third-parties.
Our PNS product targets peripheral nerve pain at its source without the use of drugs and its small profile allows the system to be implanted in many locations on the body, depending on patient needs. Durolane is an U.S.
Our PNS product targets peripheral nerve pain at its source without the use of drugs and its small profile allows the system to be implanted in many locations on the body, depending on patient needs. We also are the exclusive distributor of the XCELL PRP System in the U.S., specifically for the orthopedic and sports medicine markets.
Our products are designed to improve bone fusion rates following spine and other orthopedic surgeries, including trauma and reconstructive foot and ankle procedures. 3 Table of Contents The neXus Ultrasonic Surgical System (“neXus”) is a leading ultrasonic surgical platform that combines all the features of our Surgical Solutions applications, including BoneScalpel, BoneScalpel Access, SonaStar Elite, SonicOne and SonaStar into a single fully integrated system, setting a foundation for future developments to fulfill unmet customer needs.
The neXus Ultrasonic Surgical System (“neXus”) is a leading ultrasonic surgical platform that combines all the features of our Surgical Solutions applications, including BoneScalpel, BoneScalpel Access, SonaStar Elite, SonicOne and SonaStar into a single fully integrated system, setting a foundation for future developments to fulfill unmet customer needs.
Our products We offer a diverse portfolio of products to support physicians in relieving pain and addressing musculoskeletal challenges across indications and clinical areas, including knee, hand and upper extremities, foot and ankle, podiatry, trauma, general surgery, spine and neurosurgery.
We also plan to strategically expand to new markets with our existing portfolio and intend to selectively pursue new market opportunities. 1 Table of C o ntents Our Products We offer a diverse portfolio of products to support physicians in relieving pain and addressing musculoskeletal challenges across indications and clinical areas, including knee, hand and upper extremities, foot and ankle, podiatry, trauma, general surgery, spine and neurosurgery.
The pending patent applications, if issued, are expected to expire between 2034 and 2039, without accounting for potential patent term extensions and adjustments. We also own 19 issued U.S. patents, 20 issued foreign patents, and six pending foreign patent applications directed to our SonicOne System, including foreign patents and patent applications in Australia, Canada, and Europe.
The pending patent applications, if issued, are expected to expire between 2037 and 2038, without accounting for potential patent term extensions and adjustments. We also own six issued U.S. patents, five issued foreign patents, and one pending U.S. patent application directed to our Sonastar System.
Its small profile allows the system to be implanted in many locations around the body, depending on patient needs. StimRouter is ideally suited for patients with chronic pain of a peripheral origin who are unable to find sustained pain relief with other treatment options such as nerve blocks, nerve ablation, and other temporary treatments.
StimRouter is ideally suited for patients with chronic pain of a peripheral origin who are unable to find sustained pain relief with other treatment options such as nerve blocks, nerve ablation, and other temporary treatments.
We also own 39 issued U.S. patents, 50 issued foreign patents, and 11 pending foreign patent applications directed to our BoneScalpel system, including foreign patents and patent applications in Australia, Canada, Europe, and Japan. The U.S. patents are expected to expire between 2025 and 2039, and the foreign patents are expected to expire between 2027 and 2039.
We also own 19 issued U.S. patents, 26 issued foreign patents, and two pending foreign patent applications directed to our SonicOne System, including foreign patents and patent applications in Asia, Canada, and Europe. The U.S. patents are expected to expire between 2026 and 2039, and the foreign patents are expected to expire between 2026 and 2038.
We compete with many companies having more significant capital resources, greater R&D resources and more extensive distribution systems than we do. 6 Table of Contents Our Pain Treatments that we own or distribute compete with products from Ferring Pharmaceutical Inc., Fidia Farmaceutici S.p.A., DePuy Orthopaedics, Inc. (Johnson & Johnson), Zimmer Biomet Holdings, Inc. and Sanofi S.A, OrthogenRx Inc.
We compete with many companies that have significant capital resources, greater R&D resources and more extensive distribution systems than we do. 6 Table of C o ntents Our Pain Treatments that we own or distribute compete with products from Ferring Pharmaceutical Inc., Fidia Farmaceutici S.p.A., Johnson & Johnson, Zimmer Biomet Holdings, Inc., Arthrex, Inc., Emcyte Corporation and Channel-Markers Medical, and for peripheral nerve stimulation specifically, we compete with SPR Therapeutics, Nalu and Curonix.
Some state fraud and abuse laws apply to items or services reimbursed by any payer, including patients, employers and commercial insurers, not just those reimbursed by a federally or state funded healthcare program.
The scope of these laws and their interpretations vary from state to state and are enforced by state courts and regulatory authorities, each with broad discretion. Some state fraud and abuse laws apply to items or services reimbursed by any payer, including patients, employers and commercial insurers, not just those reimbursed by a federally or state funded healthcare program.
(Avanos) and for peripheral nerve stimulation specifically we compete with SPR Therapeutics, Nalu and Stimwave. Our Surgical Solutions products compete with products from Medtronic, DePuy Orthopaedics, Inc. (Johnson & Johnson), Stryker Corporation, NuVasive, Inc., Orthofix Medical Inc., Zimmer Biomet Holdings, Inc., Globus Medical Inc., Johnson & Johnson, Integra Life Sciences, Inc., and Söering.
Our Surgical Solutions products compete with products from Medtronic, DePuy Orthopaedics, Inc. (Johnson & Johnson), Stryker Corporation, NuVasive, Inc., Orthofix Medical Inc., Zimmer Biomet Holdings, Inc., Globus Medical Inc., Johnson & Johnson, Integra Life Sciences, Inc., and Söering. Our Restorative Therapies compete with products marketed by Orthofix Medical Inc., Zimmer Biomet Holdings, Inc., Enovis and XFT Medical.
Each device – and as applicable, each package – will have a UDI composed of two parts: a device identifier (“UDI-DI”) specific to a device, and a production identifier (“UDI-PI”) to identify the unit producing the device.
Each device – and as applicable, each package – will have a UDI composed of two parts: a device identifier (“UDI-DI”) specific to a device, and a production identifier (“UDI-PI”) to identify the unit producing the device. Manufacturers are also notably responsible for entering the necessary data on Eudamed, which includes the UDI database, and for keeping it updated.
The transition provisions covers products with CE certificates issued under the Medical Devices Directive (MDD) set to expire before the date of application.
The transition period of medical devices to MDR has been extended until December 31, 2027 or December 31, 2028 depending on the classification of the medical device. The transition provisions covers products with CE certificates issued under the Medical Devices Directive (MDD) set to expire before the date of application.
We are focused on establishing BoneScalpel as a standard of care for spine applications by accelerating market penetration in spinal surgery through increased surgeon education and awareness. In parallel, we plan to leverage the versatility of our neXus platform and its existing install base to expand into additional specialties like neurosurgery and general surgery.
We are focused on establishing BoneScalpel as a standard of care for spine applications by accelerating market penetration in spinal surgery through increased surgeon education and awareness.
We are headquartered in Durham, North Carolina. On February 16, 2021, we closed an initial public offering (“IPO”). Our IPO was conducted through what is commonly referred to as an umbrella partnership C corporation (“UP-C”) structure.
Our IPO was conducted through what is commonly referred to as an umbrella partnership C corporation (“UP-C”) structure.
Manufacturers are also notably responsible for entering the necessary data on Eudamed, which includes the UDI database, and for keeping it up to date. The obligations for registration in Eudamed will become applicable at a later date (as Eudamed is not yet fully functional).
The obligations for registration in Eudamed will become applicable at a later date (as Eudamed is not yet fully functional).
TalisMann has a small profile and is attached to the StimRouter lead intraoperatively and pocketed under the skin after the StimRouter lead electrodes are placed near the targeted peripheral nerve. Though not currently available, the 510(k) submission to the FDA for market clearance of the TalisMann was completed in the fourth quarter of 2024.
TalisMann has a small profile and is attached to the StimRouter lead intraoperatively and pocketed under the skin after the StimRouter lead electrodes are placed near the targeted peripheral nerve. FDA 510(k) clearances for both TalisMann and StimTrial were received in July 2025, expanding our innovative growth portfolio of PNS solutions for chronic pain management.
Our StimRouter Peripheral Nerve Stimulation system is a permanent option that provides relief for chronic peripheral pain, including nerve pain, neuroma, neuropathic pain, post-stroke shoulder pain and neuralgia. StimRouter is implanted during a minimally invasive outpatient procedure performed under local anesthetic and delivers gentle electrical pulses directly to target peripheral nerve pain at its source.
StimRouter is implanted during a minimally invasive outpatient procedure performed under local anesthetic and delivers gentle electrical pulses directly to target peripheral nerve pain at its source. Its small profile allows the system to be implanted in many locations around the body, depending on patient needs.
The goals of these and other similar initiatives is to encourage broad and diverse viewpoints to achieve the best outcomes for the patients, healthcare providers, and employees we serve. 19 Table of Contents Our Organizational Structure Bioventus Inc. is a Delaware corporation formed on December 22, 2015 and functions as a holding company with no direct operations and our principal asset is the equity interest in BV LLC.
Our Organizational Structure Bioventus Inc. is a Delaware corporation formed on December 22, 2015 and functions as a holding company with no direct operations whose principal asset is the equity interest in BV LLC. We are headquartered in Durham, North Carolina. On February 16, 2021, we closed an initial public offering (“IPO”).
We also own two issued U.S. patents, two issued foreign patent, and one pending foreign patent application directed to our Sonastar System. The U.S. patents are expected to expire between 2030 and 2037, and the foreign patents are expected to expire in 2037.
The U.S. patents are expected to expire between 2030 and 2045, and the foreign patents are expected to expire between 2031 and 2037.
We also plan to strategically expand to new markets with our existing portfolio and intend to selectively pursue new market opportunities. 3) Strengthen our leading position in Knee Osteoarthritis. We are focused on continued market share growth of HA in the United States through targeted high-potential account execution.
We are focused on continued market share growth of our differentiated HA, BGS and Fracture Care products, which account for the majority of our sales today, through targeted high-potential account execution.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeAny violation of the FCPA, other anti-bribery legislation, including the UK Bribery Act and the Brazil Clean Company Act, or related policies could result in severe criminal or civil sanctions, which could adversely affect our business, results of operations and financial condition. 49 Table of Contents Furthermore, we are subject to the export controls and economic embargo rules and regulations of the United States, including, but not limited to, the Export Administration Regulations and trade sanctions against embargoed countries, which are administered by the Office of Foreign Assets Control within the Department of the Treasury, as well as the laws and regulations administered by the Department of Commerce and the Department of State.
Biggest changeFurthermore, we are subject to the export controls and economic embargo rules and regulations of the United States, including, but not limited to, export controls including the Export Administration Regulations administered by the Department of Commerce, anti-boycott regulations administered by the Departments of Treasury and Department of Commerce, and trade sanctions against embargoed countries and persons administered by the Office of Foreign Assets Control within the Department of the Treasury, the Department of Commerce and the Department of State.
If we fail to properly manage growth or scale our business processes, systems, and data management, our business could suffer. We may, in the future, experience periods of rapid growth and expansion, which could place a significant additional strain on our limited personnel, information technology systems and other resources.
If we fail to properly manage growth or scale our business processes, systems, and data management, our business could suffer. In the future, we may experience periods of rapid growth and expansion, which could place a significant additional strain on our limited personnel, information technology systems and other resources.
There are a limited number of suppliers and third-party manufacturers that operate under FDA’s QSR requirements and that have the necessary expertise and capacity to manufacture our products or components for our products.
There are a limited number of suppliers and third-party manufacturers that operate under the FDA’s QSR requirements and that have the necessary expertise and capacity to manufacture our products or components for our products.
These systems and software and hardware impact, among other things, ordering and managing components of our products from suppliers, shipping products to customers on a timely basis, processing transactions, coordinating our sales activities across all of our products, summarizing and reporting results of operations, complying with regulatory, legal or tax requirements, data security and other processes necessary to manage our business.
These systems, software, and hardware impact, among other things, ordering and managing components of our products from suppliers, shipping products to customers on a timely basis, processing transactions, coordinating our sales activities across all of our products, summarizing and reporting results of operations, complying with regulatory, legal or tax requirements, data security and other processes necessary to manage our business.
To be regulated as Section 361 HCT/Ps, these products must meet FDA’s criteria to be considered “minimally manipulated” and intended for “homologous use,” among other requirements. HCT/Ps that do not meet the criteria to be considered Section 361 HCT/Ps are subject to the FDA’s regulatory requirements applicable to medical devices, biologics or drugs.
To be regulated as Section 361 HCT/Ps, these products must meet the FDA’s criteria to be considered “minimally manipulated” and intended for “homologous use,” among other requirements. HCT/Ps that do not meet the criteria to be considered Section 361 HCT/Ps are subject to the FDA’s regulatory requirements applicable to medical devices, biologics or drugs.
The inability to perform those activities, combined with our limited inventory of supplies, components and finished product, may result in the inability to continue manufacturing or supplying our products during such periods and the loss of customers or harm to our reputation.
The inability to perform those activities, combined with our limited inventory of supplies, components and finished product, may result in the inability to continue manufacturing or supplying our products during such periods, the loss of customers, or harm to our reputation.
The following examples are illustrative: • others may be able to develop and/or practice technology that is similar to our technology or aspects of our technology, but that are not covered by the claims of the patents that we own or control, assuming such patents have issued or do issue; 58 Table of Contents • we, the inventors of any in-licensed patent rights, or any future strategic partners might not have been the first to conceive or reduce to practice the inventions covered by the issued patent or pending patent application that we own or have exclusively licensed; • we, the filing party(ies) of any in-licensed patent rights, or any future strategic partners might not have been the first to file patent applications covering certain of our inventions; • others may independently develop similar or alternative technologies or duplicate any of our technologies without infringing our intellectual property rights; • our pending patent applications may not lead to issued patents; • issued patents that we own or exclusively license may not provide us with any competitive advantage, or may be held invalid or unenforceable, as a result of legal challenges by our competitors; • our competitors might conduct research and development activities in countries where we do not have patent rights and then use the information learned from such activities to develop competitive products for sale in our major commercial markets; • third parties performing manufacturing or testing for us using our products or technologies could use the intellectual property of others without obtaining a proper license; • parties may assert an ownership interest in our intellectual property and, if successful, such disputes may preclude us from exercising exclusive rights over that intellectual property; • we may not develop or in-license additional proprietary technologies that are patentable; • we may not be able to obtain and maintain necessary licenses on commercially reasonable terms, or at all; and • the patents of others may adversely affect our business.
The following examples are illustrative: • others may be able to develop and/or practice technology that is similar to our technology or aspects of our technology, but that are not covered by the claims of the patents that we own or control, assuming such patents have issued or do issue; • we, the inventors of any in-licensed patent rights, or any future strategic partners might not have been the first to conceive or reduce to practice the inventions covered by the issued patent or pending patent application that we own or have exclusively licensed; • we, the filing party(ies) of any in-licensed patent rights, or any future strategic partners might not have been the first to file patent applications covering certain of our inventions; • others may independently develop similar or alternative technologies or duplicate any of our technologies without infringing our intellectual property rights; • our pending patent applications may not lead to issued patents; • issued patents that we own or exclusively license may not provide us with any competitive advantage, or may be held invalid or unenforceable, as a result of legal challenges by our competitors; • our competitors might conduct research and development activities in countries where we do not have patent rights and then use the information learned from such activities to develop competitive products for sale in our major commercial markets; • third parties performing manufacturing or testing for us using our products or technologies could use the intellectual property of others without obtaining a proper license; • parties may assert an ownership interest in our intellectual property and, if successful, such disputes may preclude us from exercising exclusive rights over that intellectual property; • we may not develop or in-license additional proprietary technologies that are patentable; • we may not be able to obtain and maintain necessary licenses on commercially reasonable terms, or at all; and • the patents of others may adversely affect our business.
For example, a vendor informed us that Change Healthcare, a subsidiary of UnitedHealth Group that acts as an intermediary for processing certain of our claims for reimbursement related to our EXOGEN device to commercial payers, experienced an incident in which a cybersecurity threat actor gained access to some of its information technology systems.
For example, in 2024, a vendor informed us that Change Healthcare, a subsidiary of UnitedHealth Group that acts as an intermediary for processing certain of our claims for reimbursement related to our EXOGEN device to commercial payers, experienced an incident in which a cybersecurity threat actor gained access to some of its information technology systems.
In the United States, we have obtained 510(k) clearance from the FDA to market certain of our products such as SIGNAFUSE Bioactive Bone Graft Putty, Interface Bioactive Bone Graft and SIGNAFUSE Mineralized Collagen Scaffold. Our Pain Treatment products, including Durolane, GELSYN-3 and SUPARTZ FX, and our EXOGEN system, have obtained a PMA.
In the United States, we have obtained 510(k) clearance from the FDA to market certain of our products such as SIGNAFUSE Bioactive Bone Graft Putty, Interface Bioactive Bone Graft and SIGNAFUSE Mineralized Collagen Scaffold. Our Pain Treatment products, including Durolane, GELSYN-3 and SUPARTZ FX, and our EXOGEN Bone Stimulation System, have obtained a PMA.
U.S. states have adopted various privacy and security laws and regulations, some of which may be more stringent than HIPAA. Such laws and regulations will be subject to interpretation by various courts and other governmental authorities, thus creating potentially complex compliance issues for us and our future customers and strategic partners.
U.S. states have adopted various privacy and security laws and regulations, some of which may be more stringent than HIPAA. Such laws and regulations will be subject to interpretation by various courts and other governmental authorities, thus creating potentially complex compliance issues for us and our customers and strategic partners.
Payments under the TRA are be based on the tax reporting positions that we determine, and the Internal Revenue Service (“IRS”) or another tax authority may challenge all or part of the tax basis increases, as well as other related tax positions we take, and a court could sustain such challenge.
Payments under the TRA are to be based on the tax reporting positions that we determine, and the Internal Revenue Service (“IRS”) or another tax authority may challenge all or part of the tax basis increases, as well as other related tax positions we take, and a court could sustain such challenge.
In the absence of a waiver from our lenders, any failure by us to comply with these covenants in the future might result in the declaration of an event of default, which could adversely affect our business, results of operations and financial position.
In the absence of a waiver from our lenders, any failure by us to comply with these covenants might result in the declaration of an event of default, which could adversely affect our business, results of operations and financial position.
Although our agreements with our international distributors clearly state our expectations for our distributors’ compliance with U.S. laws, including the FCPA, and provide us with various remedies upon any non-compliance, including the ability to terminate the agreement, we also cannot guarantee our distributors’ compliance with U.S. laws, including the FCPA.
Although our agreements with our international distributors clearly state our expectations for our distributors’ compliance with U.S. and local laws, including the FCPA, and provide us with various remedies upon any non-compliance, including the ability to terminate the agreement, we also cannot guarantee our distributors’ compliance with U.S. laws, including the FCPA.
Among other things, the ACA: • increased the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program; 44 Table of Contents • created a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected; • extended manufacturers’ Medicaid rebate liability to individuals enrolled in Medicaid managed care organizations; • expanded eligibility criteria for Medicaid programs; • established a new Patient-Centered Outcomes Research Institute to oversee and identify priorities in comparative clinical effectiveness research in an effort to coordinate and develop such research; and • implemented payment system reforms including a national pilot program on payment bundling to encourage hospitals, physicians and other providers to improve the coordination, quality and efficiency of certain healthcare services through bundled payment models.
Among other things, the ACA: • increased the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program; • created a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected; • extended manufacturers’ Medicaid rebate liability to individuals enrolled in Medicaid managed care organizations; • expanded eligibility criteria for Medicaid programs; • established a new Patient-Centered Outcomes Research Institute to oversee and identify priorities in comparative clinical effectiveness research in an effort to coordinate and develop such research; and • implemented payment system reforms including a national pilot program on payment bundling to encourage hospitals, physicians and other providers to improve the coordination, quality and efficiency of certain healthcare services through bundled payment models.
We may also face increased cybersecurity risks due to our reliance on internet technology and the number of our employees who are working remotely, which may create additional opportunities for cybercriminals to exploit vulnerabilities.
We may also face increased cybersecurity risks due to our reliance on internet technology, the number of our employees who are working remotely, which may create additional opportunities for cybercriminals to exploit vulnerabilities.
Risks related to our business We are currently subject derivative shareholder lawsuits and have been defendants in securities class action litigation and may be subject to similar or other litigation in the future, which will require significant management time and attention, result in significant legal expenses and may result in unfavorable outcomes, which may have a material adverse effect on our business, operating results and financial condition, and negatively affect the price of our common stock.
Risks Related to Our Business We are currently subject to derivative shareholder lawsuits and have been defendants in securities class action litigation and may be subject to similar or other future litigation, which will require significant management time and attention, result in significant legal expenses and may result in unfavorable outcomes, any or all of which may have a material adverse effect on our business, operating results and financial condition, and negatively affect the price of our common stock.
Even if we are successful in developing additional products, the success of any new product offering or enhancements to existing products will depend on several factors, including our ability to: • properly identify and anticipate the needs of healthcare professionals and patients; • develop and introduce new products, line extensions and expanded indications in a timely manner; • distinguish our products from those of our competitors; 23 Table of Contents • avoid infringing upon the intellectual property rights of third parties and maintain necessary intellectual property licenses from third parties; • demonstrate, if required, the safety and efficacy of new products with data from preclinical studies and clinical trials; • obtain clearance, approval, or certification, if required, from the FDA and other regulatory agencies or notified bodies, for such new products, line extensions and expanded indications, and maintain full compliance with FDA and other regulatory requirements applicable to new devices or products or modifications of existing devices or products; • provide adequate training to potential users of our products; • market acceptance of our newly developed or acquired products or therapies; • receive adequate coverage and reimbursement for our products; and • maintain an effective and dedicated sales and marketing team.
Even if we are successful in developing additional products, the success of any new product offering or enhancements to existing products will depend on several factors, including our ability to: • properly identify and anticipate the needs of healthcare professionals and patients; • develop and introduce new products, line extensions and expanded indications in a timely manner; • distinguish our products from those of our competitors; • avoid infringing upon the intellectual property rights of third parties and maintain necessary intellectual property licenses from third parties; • demonstrate, if required, the safety and efficacy of new products with data from preclinical studies and clinical trials; 23 Table of C o ntents • obtain clearance, approval, or certification, if required, from the FDA and other regulatory agencies or notified bodies, for such new products, line extensions and expanded indications, and maintain full compliance with FDA and other regulatory requirements applicable to new devices or products or modifications of existing devices or products; • provide adequate training to potential users of our products; • market acceptance of our newly developed or acquired products or therapies; • receive adequate coverage and reimbursement for our products; and • maintain an effective and dedicated sales and marketing team.
Also in 2020, the Orthopedic and Rehabilitation Devices Panel of the FDA Medical Devices Advisory Committee met and ultimately voted in favor of the FDA’s proposal to down-classify non-invasive bone growth stimulators.
Also in 2020, the Orthopedic and Rehabilitation Devices Panel of the FDA Medical Devices Advisory Committee met and voted in favor of the FDA’s proposal to down-classify non-invasive bone growth stimulators.
In addition, the government may assert that a claim including items or services resulting from a violation of the AKS or Stark Law constitutes a false or fraudulent claim for purposes of the FCA; • the beneficiary inducement provisions of the Civil Monetary Penalties Law, which prohibits, an individual or entity from offering remuneration to a federal healthcare program beneficiary that the individual or entity knows or should know is likely to influence the beneficiary to order or receive healthcare items or services from a particular provider.
In addition, the government may assert that a claim including items or services resulting from a violation of the AKS or Stark Law constitutes a false or fraudulent claim for purposes of the FCA; • the beneficiary inducement provisions of the Civil Monetary Penalties Law, which prohibit an individual or entity from offering remuneration to a federal healthcare program beneficiary that the individual or entity knows or should know is likely to influence the beneficiary to order or receive healthcare items or services from a particular provider.
In 2020, the FDA published a Federal Register notice announcing its proposal to reclassify non-invasive bone growth stimulators, such as EXOGEN, from Class III medical devices to Class II with special controls. Class III devices are subject to the most stringent regulatory pathway for approval for medical devices requiring, among other things, rigorous clinical studies and pre-approval manufacturing review.
In 2020, the FDA published a Federal Register notice announcing its proposal to reclassify non-invasive bone growth stimulators, such as EXOGEN, from Class III medical devices to Class II with special controls. Class III devices are subject to the most stringent regulatory pathway for approval for medical devices and require, among other things, rigorous clinical studies and pre-approval manufacturing review.
The FDA enforces the QSR through periodic announced or unannounced inspections of manufacturing facilities, and both we and our third-party manufacturers and suppliers are subject to such inspections. Similarly, the devices we distribute on behalf of third-party manufacturers that are regulated as Section 361 HCT/Ps must be manufactured in compliance with FDA’s cGTP requirements and other related requirements.
The FDA enforces the QSR through periodically announced or unannounced inspections of manufacturing facilities, and both we and our third-party manufacturers and suppliers are subject to such inspections. Similarly, the devices we distribute on behalf of third-party manufacturers that are regulated as Section 361 HCT/Ps must be manufactured in compliance with the FDA’s cGTP requirements and other related requirements.
In connection with our EXOGEN system, we submit claims directly to, and receive payments directly from, the Medicare and Medicaid programs and private payers. Therefore, we are subject to extensive government regulation, including detailed requirements for submitting claims under appropriate codes and maintaining certain documentation, including evidence that all medical necessity requirements are met to support our claims.
In connection with our EXOGEN Bone Stimulation System, we submit claims directly to, and receive payments directly from, the Medicare and Medicaid programs and private payers. Therefore, we are subject to extensive government regulation, including detailed requirements for submitting claims under appropriate codes and maintaining certain documentation, including evidence that all medical necessity requirements are met to support our claims.
From our initial public offering in February 2021 through February 27, 2025, the per share trading price of our Class A common stock has been as high as $19.94 and as low as $0.80. It might continue to fluctuate significantly in response to various factors, some of which are beyond our control.
From our initial public offering in February 2021 through February 27, 2026, the per share trading price of our Class A common stock has been as high as $19.94 and as low as $0.80. It might continue to fluctuate significantly in response to various factors, some of which are beyond our control.
We will continue to qualify as an emerging growth company until the earliest of: • The last day of our fiscal year following the fifth anniversary of the date of our IPO; • The last day of our fiscal year in which have annual gross revenues of at least $1.235 billion or more; • The date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt; • The date on which we are deemed to be a “large accelerated filer,” as such terms is defined in the Exchange Act rules.
We will continue to qualify as an emerging growth company until the earliest of: • December 31, 2026 (the last day of the fiscal year following the fifth anniversary of the date of our IPO); • The last day of our fiscal year in which we have annual gross revenues of at least $1.235 billion or more; • The date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt; • The date on which we are deemed to be a “large accelerated filer,” as such terms is defined in the Exchange Act rules.
If the reclassification of HA products were to occur, the FDA may not allow us to continue to market our HA products without submitting additional clinical trial data, obtaining approval of a NDA for these products, or without otherwise complying with new conditions or limitations on how those products are marketed.
If the reclassification of HA products were to occur, the FDA may not allow us to continue to market our HA products without submitting additional clinical trial data, obtaining approval of an NDA for these products, or without otherwise complying with new conditions or limitations on how those products are marketed.
The Original LLC Owners are able to, subject to applicable law, and the voting arrangements, elect a majority of the members of our Board, control actions to be taken by us and our Board, including amendments to our certificate of incorporation and bylaws and approval of significant corporate transactions, including mergers and sales of substantially all of our assets.
The Original LLC Owners may be able to, subject to applicable law, and the voting arrangements, elect a majority of the members of our Board, control actions to be taken by us and our Board, including amendments to our certificate of incorporation and bylaws and approval of significant corporate transactions, including mergers and sales of substantially all of our assets.
The FDA requires every manufacturer to make the determination regarding the need for a new 510(k) submission in the first instance, but the FDA may review any manufacturer’s decision. We may make changes to our 510(k)-cleared products in the future that we may determine do not require a new 510(k) clearance or PMA.
The FDA requires every manufacturer to make the determination regarding the need for a new 510(k) submission in the first instance, but the FDA may review any manufacturer’s decision. We may make changes to our 510(k)-cleared products in the future, which we may determine do not require a new 510(k) clearance or PMA.
Other states, including Nevada and Washington, have recently enacted robust health privacy laws. Legislation has been proposed in other states and at the federal level, reflecting a trend toward more stringent privacy legislation in the United States. These developments are likely to result in increased privacy and data security enforcement.
Other states, including Nevada and Washington, enacted robust health privacy laws. Legislation has been proposed in other states and at the federal level, reflecting a trend toward more stringent privacy legislation in the United States. These developments are likely to result in increased privacy and data security enforcement.
Such impacts include but are not limited to: investigation costs, legal fees, fines and penalties; compensatory, special, punitive, and statutory damages; enforcement actions; litigation; reputational damage; consent orders regarding our privacy and security practices; requirements that we provide consumer notices, credit monitoring services, and/or credit restoration services or other relevant services to individuals impacted by a data breach; adverse actions against our licenses to do business; and injunctive relief. 47 Table of Contents In the United States, HIPAA, as amended, and regulations implemented thereunder (collectively referred to as “HIPAA”) imposes, among other things, certain standards relating to the privacy and security of protected health information (“PHI”) on certain healthcare providers, health plans, and healthcare clearinghouses, known as covered entities, as well as their business associates that perform certain services that generally involve creating, receiving, maintaining or transmitting PHI for or on behalf of such covered entities, and their covered subcontractors.
Such impacts include but are not limited to: investigation costs, legal fees, fines and penalties; compensatory, special, punitive, and statutory damages; enforcement actions; litigation; reputational damage; consent orders regarding our privacy and security practices; requirements that we provide consumer notices, credit monitoring services, and/or credit restoration services or other relevant services to individuals impacted by a data breach; adverse actions against our licenses to do business; and injunctive relief. 49 Table of C o ntents In the United States, HIPAA, as amended, and regulations implemented thereunder (collectively referred to as “HIPAA”) imposes, among other things, certain standards relating to the privacy and security of protected health information (“PHI”) on certain healthcare providers, health plans, and healthcare clearinghouses, known as covered entities, as well as their business associates that perform certain services that generally involve creating, receiving, maintaining or transmitting PHI for or on behalf of such covered entities, and their covered subcontractors.
We are an emerging growth company and a smaller reporting company, and we cannot be certain if the reduced disclosure requirements applicable to us will make our Class A common stock less attractive to investors. We are an “emerging growth company” pursuant to the provisions of the JOBS Act.
We are an emerging growth company and we cannot be certain if the reduced disclosure requirements applicable to us will make our Class A common stock less attractive to investors. We are an “emerging growth company” pursuant to the provisions of the JOBS Act.
Civil monetary penalties of up to $1,000,000 as adjusted annually may be imposed on reporting entities if they fail to report information in a timely, accurate or complete manner; • federal consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm customers; • federal government price reporting laws; 46 Table of Contents • privacy and data security requirements imposed by HIPAA, including the Privacy Rule, the Security Rule, and the Breach Notification Rule promulgated pursuant to HIPAA; and • analogous state law equivalents of each of the above federal laws, state anti-kickback and false claims laws; state laws requiring device companies to comply with specific compliance standards, restrict payments made to healthcare providers and other potential referral sources, and report information related to payments and other transfers of value to healthcare providers or marketing expenditures; and state laws related to insurance fraud in the case of claims involving private insurers.
Civil monetary penalties of up to $1,000,000 as adjusted annually may be imposed on reporting entities if they fail to report information in a timely, accurate or complete manner; • federal consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm customers; • federal government price reporting laws; 48 Table of C o ntents • privacy and data security requirements imposed by HIPAA, including the Privacy Rule, the Security Rule, and the Breach Notification Rule promulgated pursuant to HIPAA; and • analogous state law equivalents of each of the above federal laws, state anti-kickback and false claims laws; state laws requiring device companies to comply with specific compliance standards, restrict payments made to healthcare providers and other potential referral sources, and report information related to payments and other transfers of value to healthcare providers or marketing expenditures; and state laws related to insurance fraud in the case of claims involving private insurers.
Violations of the CMPL may result in CMPs of $24,947 and in administrative penalties ranging up to $100,000 per violation depending on the conduct involved; • the criminal healthcare fraud provisions of Health Insurance Portability and Accountability Act, or “HIPAA”, and related rules that prohibit knowingly and willfully executing a scheme or artifice to defraud any healthcare benefit program or falsifying, concealing or covering up a material fact or making any material false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services.
Violations of the CMPL may result in CMPs of $25,663 and in administrative penalties ranging up to $100,000 per violation depending on the conduct involved; • the criminal healthcare fraud provisions of Health Insurance Portability and Accountability Act, or “HIPAA”, and related rules that prohibit knowingly and willfully executing a scheme or artifice to defraud any healthcare benefit program or falsifying, concealing or covering up a material fact or making any material false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services.
For example, in December 2020 we undertook a voluntary Class II recall of certain vials of ultrasound gel that we provide with our EXOGEN system due to particulates, which were microbial in nature, found in the gel.
For example, in December 2020 we undertook a voluntary Class II recall of certain vials of ultrasound gel that we provide with our EXOGEN Bone Stimulation System due to particulates, which were microbial in nature, found in the gel.
We do not have redundant manufacturing facilities and have one primary location for manufacturing in the Memphis, Tennessee area. Our other facilities and equipment would be costly to replace and could require substantial lead-time to repair or replace.
We do not have redundant manufacturing facilities and have one primary location for manufacturing in Memphis, Tennessee. Our other facilities and equipment would be costly to replace and could require substantial lead-time to repair or replace.
If we have to cease marketing and/or have to recall any of our Surgical Solutions products our net sales would decrease, which would adversely affect our business, results of operations and financial condition. 40 Table of Contents HCT/Ps that do not meet the criteria of Section 361 are regulated under Section 351 of the PHSA.
If we have to cease marketing and/or have to recall any of our Surgical Solutions products our net sales would decrease, which would adversely affect our business, results of operations and financial condition. HCT/Ps that do not meet the criteria of Section 361 are regulated under Section 351 of the PHSA.
The issuance of shares of our Class A common stock upon the exchange of LLC Interests would significantly dilute the ownership interest of our Class A common stockholders and the resale of such shares by the Selling Securityholders pursuant to the Form S-3 once declared effective, or the perception in the market that the Selling Securityholders intend to sell such shares, could adversely affect the market price of our Class A common stock.
The issuance of shares of our Class A common stock upon the exchange of LLC Interests would significantly dilute the ownership interest of our Class A common stockholders and the resale of such shares by the Selling Securityholders pursuant to the Form S-3, or the perception in the market that the Selling Securityholders intend to sell such shares, could adversely affect the market price of our Class A common stock.
If we are unable to manage our growth effectively, it may be difficult for us to execute our business strategy and our operating results and business could suffer. 24 Table of Contents Demand for our existing products and any new products, line extensions or expanded indications depends on the continued and future acceptance of our products by physicians, patients, third-party payers and others in the medical community.
If we are unable to manage our growth effectively, it may be difficult for us to execute our business strategy and our operating results and business could suffer. 24 Table of C o ntents Demand for our existing products and any new products, line extensions or expanded indications depends on the continued and future acceptance of our products by physicians, patients, third-party payers and others in the medical community.
We may not realize the anticipated strategic or financial benefits from our business divestitures, which may adversely affect our results of operations and financial condition. We have in the past divested of certain of our businesses, including most recently our Advanced Rehabilitation business, to help improve our focus on our core businesses and improve our liquidity.
We may not realize the anticipated strategic or financial benefits from our business divestitures, which may adversely affect our results of operations and financial condition. We have in the past divested of certain of our businesses, including our Advanced Rehabilitation Business and Wound Business, to help improve our focus on our core businesses and improve our liquidity.
It is unknown whether any other sterilization facilities we may contract with in the future will experience reduced capacity related to new regulatory requirements or will be required to shut down, either temporarily related to upgrading emissions controls or permanently due to inability to comply with the new environmental regulations.
It is unknown whether any other sterilization facilities with which contract in the future will experience reduced capacity related to new regulatory requirements or will be required to shut down, either temporarily related to upgrading emissions controls or permanently due to inability to comply with the new environmental regulations.
In addition, the anticipated benefits related to any divestiture may take longer to realize than expected, and a failure to achieve the anticipated financial and strategic benefits of a divestiture could be disruptive to our operations and could have a material adverse impact on our business, results of operations, financial condition and cash flows.
In addition, the anticipated benefits related to any divestiture may take longer to realize than expected or may not materialize, and a failure to achieve the anticipated financial and strategic benefits of a divestiture could be disruptive to our operations and could have a material adverse impact on our business, results of operations, financial condition and cash flows.
Billing for our EXOGEN system is complex, time-consuming and expensive, particularly for items and services provided to government healthcare program beneficiaries, such as Medicare and Medicaid.
Billing for our EXOGEN Bone Stimulation System is complex, time-consuming and expensive, particularly for items and services provided to government healthcare program beneficiaries, such as Medicare and Medicaid.
In addition to reimbursing the government any associated overpayment, violations of the Stark Law can lead to: (1) civil penalties of nearly $30,868 per claim (in 2024, adjusted annually for inflation); (2) three times the amount of damages suffered by the government; and (3) potential exclusion from participation in federal healthcare programs; • the False Claims Act, or “FCA”, which imposes civil and criminal liability on individuals or entities that knowingly submit false or fraudulent claims for payment to the government or knowingly make, or cause to be made, a false statement in order to have a false claim paid, including qui tam or whistleblower suits.
In addition to reimbursing the government any associated overpayment, violations of the Stark Law can lead to: (1) civil penalties of nearly $31,670 per claim (in 2025, adjusted annually for inflation); (2) three times the amount of damages suffered by the government; and (3) potential exclusion from participation in federal healthcare programs; • the False Claims Act, or “FCA”, which imposes civil and criminal liability on individuals or entities that knowingly submit false or fraudulent claims for payment to the government or knowingly make, or cause to be made, a false statement in order to have a false claim paid, including qui tam or whistleblower suits.
There is no guarantee that patents will not issue in the future from currently pending applications that may be infringed by our technology or products.
There is no guarantee that patents will not be issued in the future from currently pending applications that may be infringed by our technology or products.
Moreover, should any of our HA products be re-classified as drugs, such products would be required to comply with a different set of manufacturing requirements under FDA’s cGMP requirements for drugs. The need to comply with different manufacturing requirements may require us to seek new suppliers.
Moreover, should any of our HA products be reclassified as drugs, such products would be required to comply with a different set of manufacturing requirements under the FDA’s cGMP requirements for drugs. The need to comply with different manufacturing requirements may require us to seek new suppliers.
Furthermore, our suppliers may not currently be or may not continue to be in compliance with all applicable regulatory requirements, which could result in our failure to produce our products on a timely basis and in the required quantities, if at all. Our products may be subject to product recalls.
Furthermore, our suppliers may not currently be or may not continue to be in compliance with all applicable regulatory requirements, which could result in our failure to produce our products on a timely basis and in the required quantities, if at all.
Reimbursement claims may be adversely affected by improper completion of the Certificates of Medical Necessity (“CMN”) required in connection with Medicare claims for the EXOGEN system and we may be subject to investigations by governmental authorities or third-party payers and required to prove the validity of the claims or the authenticity of the signatures on the CMNs under investigation.
Reimbursement claims may be adversely affected by improper completion of the Certificates of Medical Necessity (“CMN”) or other documentation required in connection with Medicare claims for the EXOGEN Bone Stimulation System and we may be subject to investigations by governmental authorities or third-party payers and required to prove the validity of the claims or the authenticity of the signatures on the CMNs under investigation.
Even after clearance or approval for our products is obtained, we and the products are subject to extensive post market regulation by the FDA, including with respect to advertising, marketing, labeling, manufacturing, distribution, import, export, and clinical evaluation. 38 Table of Contents We are also required to timely file various reports with regulatory agencies.
Even after clearance or approval for our products is obtained, we and the products are subject to extensive post-market regulation by the FDA, including with respect to advertising, marketing, labeling, manufacturing, distribution, import, export, and clinical evaluation. We are also required to timely file various reports with regulatory agencies.
The European Commission issued revised SCCs in 2021 to account for the decision of the CJEU and recommendations made by the European Data Protection Board (“EDPB”). The United States and the EU agreed to a new data transfer mechanism to replace the Privacy Shield known as the EU-U.S. Data Privacy Framework, which may be subject to legal challenges.
The European Commission issued revised SCCs in 2021 to account for the decision of the CJEU and recommendations made by the European Data Protection Board (“EDPB”). The United States and the EU agreed to a new data transfer mechanism to replace the Privacy Shield known as the EU-U.S. Data Privacy Framework, which has been subject to legal challenges.
While the FDA has not yet finalized its proposal to down-classify non-invasive bone growth stimulators, should such down-classification occur now or in the future, we may face additional competition from new market entrants who would be able to pursue marketing authorization through the 510(k) clearance pathway instead of the more onerous and burdensome PMA approval process.
Although the FDA has not yet finalized its proposal to down-classify non-invasive bone growth stimulators, should such down-classification occur now or in the future, we could face additional competition from new market entrants who would be able to pursue marketing authorization through the 510(k) clearance pathway instead of the more onerous and burdensome PMA process.
In addition, such lawsuits may make it more difficult to finance our operations. We are highly dependent on a limited number of products for revenue generation and profitability. Our HA products accounted for 46%, 43% and 42% of our total revenue for the years ended December 31, 2024, 2023 and 2022, respectively.
In addition, such lawsuits may make it more difficult to finance our operations. We are highly dependent on a limited number of products for revenue generation and profitability. Our HA products accounted for 49%, 46% and 43% of our total revenue for the years ended December 31, 2025, 2024 and 2023, respectively.
Product liability and related claims could divert management’s attention from our core business, be expensive to defend and result in sizeable damage awards against us that may not be covered by insurance. Further, our promotional materials and training methods must comply with FDA and other applicable laws and regulations, including the prohibition of the promotion of off-label use.
Product liability and related claims could divert management’s attention from our core business, be expensive to defend and result in sizeable damage awards against us that may not be covered by insurance. 43 Table of C o ntents Further, our promotional materials and training methods must comply with FDA and other applicable laws and regulations, including the prohibition of the promotion of off-label use.
Any such claim could also force use to do one or more of the following: • incur substantial monetary liability for infringement or other violations of intellectual property rights, which we may have to pay if a court decides that the product, service, or technology at issue infringes or violates the third-party’s rights, and if the court finds that the infringement was willful, we could be ordered to pay treble damages and the third-party’s attorneys’ fees; • pay substantial damages to our customers or end users to discontinue use or replace infringing technology with non-infringing technology; • stop manufacturing, offering for sale, selling, using, importing, exporting or licensing the product or technology incorporating the allegedly infringing technology or stop incorporating the allegedly infringing technology into such product, service, or technology; • obtain from the owner of the infringed intellectual property right a license, which may require us to pay substantial upfront fees or royalties to sell or use the relevant technology and which may not be available on commercially reasonable terms, or at all; • redesign our products, services, and technology so they do not infringe or violate the third-party’s intellectual property rights, which may not be possible or may require substantial monetary expenditures and time; • enter into cross-licenses with our competitors, which could weaken our overall intellectual property position; • lose the opportunity to license our technology to others or to collect royalty payments based upon successful protection and assertion of our intellectual property against others; • find alternative suppliers for non-infringing products and technologies, which could be costly and create significant delay; or • relinquish rights associated with one or more of our patent claims, if our claims are held invalid or otherwise unenforceable.
Any such claim could also force use to do one or more of the following: • incur substantial monetary liability for infringement or other violations of intellectual property rights, which we may have to pay if a court decides that the product, service, or technology at issue infringes or violates the third-party’s rights, and if the court finds that the infringement was willful, we could be ordered to pay treble damages and the third-party’s attorneys’ fees; • pay substantial damages to our customers or end users to discontinue use or replace infringing technology with non-infringing technology; • stop manufacturing, offering for sale, selling, using, importing, exporting or licensing the product or technology incorporating the allegedly infringing technology or stop incorporating the allegedly infringing technology into such product, service, or technology; • obtain from the owner of the infringed intellectual property right a license, which may require us to pay substantial upfront fees or royalties to sell or use the relevant technology and which may not be available on commercially reasonable terms, or at all; • redesign our products, services, and technology so they do not infringe or violate the third-party’s intellectual property rights, which may not be possible or may require substantial monetary expenditures and time; • enter into cross-licenses with our competitors, which could weaken our overall intellectual property position; • lose the opportunity to license our technology to others or to collect royalty payments based upon successful protection and assertion of our intellectual property against others; • find alternative suppliers for non-infringing products and technologies, which could be costly and create significant delay; or • relinquish rights associated with one or more of our patent claims, if our claims are held invalid or otherwise unenforceable. 58 Table of C o ntents Some of our competitors may be able to sustain the costs of complex intellectual property litigation more effectively than we can.
There may be others that we have not identified or that we have deemed to be immaterial. All forward-looking statements made by us or on our behalf are qualified by the risks described below. Risks related to our financial position Our Amended 2019 Credit Agreement contains financial and operating restrictions that may limit our access to credit.
There may be others that we have not identified or that we have deemed to be immaterial. All forward-looking statements made by us or on our behalf are qualified by the risks described below. Risks Related to Our Financial Position Our 2025 Credit Agreement contains financial and operating restrictions that could limit our access to credit.
In addition, our indebtedness could have significant consequences on our financial position, including: • requiring a substantial portion of our cash flows to be dedicated to debt service payments instead of funding growth, working capital, capital expenditures, investments or other cash requirements; • reducing our flexibility to adjust to changing business conditions or obtain additional financing; • exposing us to the risk of increased interest rates as certain of our borrowings, including borrowings under our term loan, are at variable rates, making it more difficult for us to make payments on our indebtedness; • restricting us from making strategic acquisitions or causing us to make non-strategic divestitures; and • limiting our ability to obtain additional financing for working capital, capital expenditures, debt service requirements and general corporate or other purposes.
In addition, our indebtedness could have significant consequences on our financial position, including: • requiring a substantial portion of our cash flows to be dedicated to debt service payments instead of funding growth, working capital, capital expenditures, investments or other cash requirements; • reducing our flexibility to adjust to changing business conditions or obtain additional financing; 21 Table of C o ntents • exposing us to the risk of increased interest rates as certain of our borrowings, including borrowings under the term loan under the 2025 Credit Agreement, are at variable rates, making it more difficult for us to make payments on our indebtedness; • restricting us from making strategic acquisitions or causing us to make non-strategic divestitures; and • limiting our ability to obtain additional financing for working capital, capital expenditures, debt service requirements or general corporate purposes.
By way of example, the Affordable Care Act (“ACA”) substantially changed the way healthcare is financed by both governmental and private insurers, encourages improvements in the quality of healthcare items and services and significantly impacts the medical device industry.
The Affordable Care Act (“ACA”), for instance, substantially changed the way healthcare is financed by both governmental and private insurers, encourages improvements in the quality of healthcare items and services and significantly impacts the medical device industry.
We cannot predict if investors will find our Class A common stock less attractive because we may rely on the reduced disclosure requirements and exemptions applicable to emerging growth companies and/or smaller reporting companies.
We cannot predict if investors will find our Class A common stock less attractive because we may rely on the reduced disclosure requirements and exemptions applicable to emerging growth companies.
Our facilities may be harmed or rendered inoperable by natural disasters (including events caused by or intensified by climate change) or man-made disasters, including, but not limited to, tornadoes, flooding, fire and power outages.
Our equipment and facilities might be harmed or rendered inoperable by natural disasters (including events caused by or intensified by climate change) or man-made disasters, including, but not limited to, tornadoes, flooding, fire and power outages.
Any of these sanctions could also result in higher than anticipated costs or lower than anticipated sales and adversely affect our business, results of operations and financial condition. In addition, the FDA’s and other regulatory authorities’ policies may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates.
Any of these sanctions could also result in higher than anticipated costs or lower than anticipated sales and adversely affect our business, results of operations and financial condition. 40 Table of C o ntents In addition, the FDA’s and other regulatory authorities’ policies may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates.
Any reluctance on the part of patients to undergo procedures utilizing our products due to cost could impact our ability to expand sales of our products and could adversely impact our business, results of operations and financial condition. 45 Table of Contents We are subject to federal, state and foreign laws and regulations relating to our healthcare business, and could face substantial penalties if we are determined not to have fully complied with such laws, which would adversely affect our business, results of operations and financial condition.
Any reluctance on the part of patients to undergo procedures utilizing our products due to cost could impact our ability to expand sales of our products and could adversely impact our business, results of operations and financial condition. 47 Table of C o ntents We are subject to federal, state and foreign laws and regulations relating to our healthcare business, and could face substantial penalties if we are determined not to have fully complied with such laws, which would adversely affect our business, results of operations and financial condition.
In addition, the approval of a biologic product biosimilar to one of our products could have a material adverse impact on our business as it may be significantly less costly to bring to market and may be priced significantly lower than our products. Intellectual property rights do not necessarily address all potential threats to our business.
In addition, the approval of a biologic product biosimilar to one of our products could have a material adverse impact on our business as it may be significantly less costly to bring to market and may be priced significantly lower than our products. 59 Table of C o ntents Intellectual property rights do not necessarily address all potential threats to our business.
As a result, our patent portfolio may not provide us with sufficient rights to exclude others from commercializing product candidates similar or identical to ours. Trademarks We rely on our trademarks as one means to distinguish our products from the products of our competitors, and have registered or applied to register many of these trademarks.
As a result, our patent portfolio may not provide us with sufficient rights to exclude others from commercializing product candidates similar or identical to ours. 55 Table of C o ntents Trademarks We rely on our trademarks as one means to distinguish our products from the products of our competitors, and have registered or applied to register many of these trademarks.
Penalties for violating the AKS include civil penalties of up to $124,732 per violation plus three times the amount of the improper remuneration, criminal penalties up to $100,000 per violation, prison terms of up to ten years, and exclusion from participation in the federal healthcare programs.
Penalties for violating the AKS include civil penalties of up to $127,973 per violation plus three times the amount of the improper remuneration, criminal penalties up to $100,000 per violation, prison terms of up to ten years, and exclusion from participation in the federal healthcare programs.
We have availed ourselves of some of these reduced reporting obligations and exemptions in our SEC filings and expect to continue to do so in future SEC filings. 63 Table of Contents In addition, emerging growth companies can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.
We have availed ourselves of some of these reduced reporting obligations and exemptions in our SEC filings and, if available, expect to continue to do so in future SEC filings. In addition, emerging growth companies can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.
Patients may also not participate in our clinical trials if they choose to participate in contemporaneous clinical trials of competitive products. In addition, patients participating in clinical trials may die before completion of the trial or suffer adverse medical events unrelated to investigational products. Clinical failure can occur at any stage of testing.
Patients may also not participate in our clinical trials if they choose to participate in contemporaneous clinical trials of competitive products. In addition, patients participating in clinical trials may die before completion of the trial or suffer adverse medical events unrelated to investigational products. 42 Table of C o ntents Clinical failure can occur at any stage of testing.
While such actions have not disrupted our ability to supply products and the previously shut down facilities have been permitted to resume certain operations after implementation of increased emissions controls, it is uncertain as to whether these facilities will be shut down or experience capacity reductions related to environmental, health and safety concerns. In March 2024, the U.S.
While such actions have not disrupted our ability to supply products and the previously shut down facilities have been permitted to resume operations after implementation of increased emissions controls, it is uncertain as to whether these facilities will be shut down or experience capacity reductions related to environmental, health and safety concerns.
Failure to comply with the GDPR can result in fines up to the greater of €20 million (approximately $21 million), or 4% of global revenue. Additionally, following the United Kingdom’s departure from the EU, we have also had to comply with the UK GDPR (i.e., the GDPR as implemented into UK law).
Additionally, following the United Kingdom’s departure from the EU, we have also had to comply with the UK GDPR (i.e., the GDPR as implemented into UK law). Failure to comply with the UK GDPR can result in fines up to the greater of £17.5 million, or 4% of global revenue.
However, we cannot assure you that the measures we have taken to date, and actions we may take in the future, will be sufficient to prevent or avoid financial misstatements due to error or material weaknesses.
However, we cannot provide assurance that the measures we have taken to date, and actions we may take in the future, will be sufficient to prevent or avoid financial misstatements due to error or material weaknesses.
If we fail to comply with its financial or other covenants, we may be required to repay the indebtedness, which may harm our liquidity.
If we fail to comply with its financial or other covenants, we might be required to repay the indebtedness, which could harm our liquidity.
Our competitors or other patent holders may assert that our products and/or the methods employed in our products are covered by their patents or that we are infringing, misappropriating, or misusing their trademark, copyright, trade secret, and/or other proprietary rights. If our products or methods are found to infringe, we could be prevented from manufacturing or marketing our products.
Our competitors or other patent holders may assert that our products and/or the methods employed in our products are covered by their patents or that we are infringing, misappropriating, or misusing their trademark, copyright, trade secret, and/or other proprietary rights. 57 Table of C o ntents If our products or methods are found to infringe, we could be prevented from manufacturing or marketing our products.
Across industries, companies are facing increasing requirements to disclose information about social and environmental risks and increasing pressure to improve performance on aspects of sustainability, such as climate impact and product environmental performance, that go beyond currently enacted legislative or regulatory mandates.
Globally, companies are facing increasing requirements to disclose information about social and environmental risks and increasing pressure to improve performance on aspects of sustainability, such as climate impact and product environmental performance, which go beyond currently enacted legislative or regulatory mandates.
Item 1A. Risk Factors. Described below are certain risks that we believe apply to our business and the industry in which we operate. You should carefully consider each of the following risk factors in conjunction with other information provided in this Annual Report on Form 10-K (“Annual Report”) and in our other public disclosures.
Item 1A. Risk Factors. Described below are certain risks that we believe apply to our business and the industry in which we operate. You should carefully consider each of the following risk factors in conjunction with other information provided in this Annual Report and in our other public disclosures.
In addition to enforcing against organizations, the FTC has made clear that it may seek to hold officers personally liable for privacy or security violations of their organizations, having done so in the past. 48 Table of Contents In Europe, the GDPR imposes strict requirements for processing personal data.
In addition to enforcing against organizations, the FTC has made clear that it may seek to hold officers personally liable for privacy or security violations of their organizations, having done so in the past. 50 Table of C o ntents In Europe, the GDPR imposes strict requirements for processing personal data.
For example, recently the operations of certain of our contracted sterilization providers were temporarily suspended by the supplier as a voluntary response to a state environmental agency investigation.
For example, in past years, the operations of certain of our contracted sterilization providers were temporarily suspended by the supplier as a voluntary response to a state environmental agency investigation.
As we conduct our business in jurisdictions outside of the United States, we face significant risks if we fail to comply with the FCPA and other laws that prohibit improper payments, offers or promises of payment to foreign governments and their officials and political parties by us and other business entities for the purpose of obtaining or retaining business or other advantages.
As we conduct our business in jurisdictions outside of the United States, we face significant risks if we fail to comply with the FCPA and other laws that prohibit improper payments, offers or promises of payment by us and other business entities for the purpose of improperly obtaining or retaining business or other advantages.
Accordingly, our future results could be harmed by a variety of factors associated with international sales and operations, including: • economic weakness, including inflation, or political instability in particular foreign economies and markets; • unexpected changes in tariffs, trade barriers and regulatory requirements, export licensing requirements or other restrictive actions by the United States or foreign governments; • foreign currency fluctuations, which could result in increased operating expenses and reduced revenue, and other obligations incident to doing business in another country; • customers in some foreign countries potentially having longer payment cycles; • exposure of our foreign operations to liability under U.S. laws and regulations, including the U.S.
Accordingly, our future results could be harmed by a variety of factors associated with international sales and operations, including: • economic weakness, including inflation, or political instability in particular foreign economies and markets; • tariffs, trade barriers import/export restrictions, foreign investment reviews, export licensing requirements, or other requirements or restrictive actions by the United States or foreign governments; 35 Table of C o ntents • foreign currency fluctuations or currency controls, which could result in increased operating expenses and reduced revenue, and other obligations incident to doing business in another country; • customers in some foreign countries potentially having longer payment cycles; • exposure of our foreign operations to liability under U.S. laws and regulations, including the U.S.
We cannot be certain that our existing products and any new products, line extensions or expanded indications that we develop will achieve or maintain market acceptance. Third-party payers may be reluctant to continue to cover our products at their current prices.
We cannot be certain that our existing products and any new products, such as our newly launched PNS and PRP products, or any line extensions or expanded indications that we develop will achieve or maintain market acceptance. Third-party payers may be reluctant to continue to cover our products at their current prices.
Acquisitions also frequently result in the recording of goodwill and other intangible assets which are subject to potential impairment in the future that could harm our financial results. If we were to issue additional equity in connection with such acquisitions, this may dilute our stockholders.
Acquisitions also frequently result in the recording of goodwill and other intangible assets which are subject to potential impairment in the future that could harm our financial results. The issuance of additional equity in connection with such acquisitions may dilute our stockholders.
If the value of such equity incentive awards does not appreciate as measured by the performance of the price of our Class A common stock, such awards may cease to be viewed as valuable and our ability to attract, retain and motivate our employees could be adversely impacted, which could adversely affect our business, results of operations and financial condition and/or require us to increase the amount we expend on cash and other forms of compensation. 30 Table of Contents We may not be able to strengthen our brand and the brands associated with our products.
If the value of such equity incentive awards does not appreciate as measured by the performance of the price of our Class A common stock, such awards may cease to be viewed as valuable and our ability to attract, retain and motivate our employees could be adversely impacted, which could adversely affect our business, results of operations and financial condition and/or require us to increase the amount we expend on cash and other forms of compensation.
HIPAA requires covered entities, such as us, as well as business associates, to develop and maintain administrative, physical and technical safeguards to protect PHI. HHS recently updated the HIPAA Privacy Rule and proposed updates to the HIPAA Security Rule. These developments could pose compliance challenges for us.
HIPAA requires covered entities, such as us, as well as business associates, to develop and maintain administrative, physical and technical safeguards to protect PHI. HHS recently proposed updates to the HIPAA Security Rule. This development could pose compliance challenges for us.
Penalties for a violation of the FCA include fines up to $27,894 for each false claim, plus up to three times the amount of damages caused by each false claim.
Penalties for a violation of the FCA include fines up to $29,363 for each false claim, plus up to three times the amount of damages caused by each false claim.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThose processes include assessing the third parties’ information security practices before allowing them to access our information systems or data, requiring the third parties to implement appropriate cybersecurity controls and otherwise agree to contractual requirements designed to address cybersecurity risks in our agreements with them, and conducting ongoing monitoring of their compliance with those requirements.
Biggest changeThose processes include assessing the third party’s information security practices before allowing them to access our information systems or data, requiring the third parties to implement appropriate cybersecurity controls and otherwise agree to contractual requirements designed to address cybersecurity risks in our agreements with them, and conducting ongoing monitoring of their compliance with those requirements. 66 Table of C o ntents Risks from Cybersecurity Threats As of the date of this Annual Report, we have not encountered any risks from cybersecurity threats that have materially affected or are reasonably likely to materially affect the Company, including its business strategy, results of operations, or financial condition.
As a result of the Change Healthcare incident, certain of our patient billing and collections processes were disrupted. We have identified an alternative claim processing intermediary and have resumed claims submissions, but this incident caused delays in a portion of our claims submissions to some commercial payers thereby delaying the related cash remittances to us.
As a result of the Change Healthcare incident, certain of our patient billing and collections processes were disrupted. We identified an alternative claim processing intermediary and have resumed claims submissions, but this incident caused delays in a portion of our claims submissions to some commercial payers thereby delaying the related cash remittances to us.
For example, Change Healthcare, a subsidiary of UnitedHealth Group that acts as an intermediary for processing certain of our claims for reimbursement related to our EXOGEN device to commercial payers experienced an incident in which a cybersecurity threat actor gained access to some of its information technology systems.
For example, Change Healthcare, a subsidiary of UnitedHealth Group that acts as an intermediary for processing certain of our claims for reimbursement related to our EXOGEN device to commercial payers experienced an incident in 2024 in which a cybersecurity threat actor gained access to some of its information technology systems.
Governance The oversight of Bioventus’ Cybersecurity Program falls under the purview of the Company’s Director of IT Security, Risk and Compliance, who has over 25 years of combined technical and leadership experience, with the past 18 years focused on information security and technology risk management, and holds Certified Information Systems Security Professional (CISSP) and Certified Information Security Manager (CISM) certifications.
Governance The oversight of Bioventus’ Cybersecurity Program falls under the purview of the Company’s Director of IT Security, Risk and Compliance, who has over 25 years of combined technical and leadership experience, with the past 19 years focused on information security and technology risk management, and holds Certified Information Systems Security Professional (CISSP) and Certified Information Security Manager (CISM) certifications.
These include cybersecurity consultants and external auditors to review the Company’s cybersecurity posture and responsive efforts. Our relationships with these external partners enable us to leverage their expertise with the goal of maintaining best practices. Oversight of Third-Party Risks Our third-party service providers, suppliers, and vendors face their own risks from cybersecurity threats that could impact Bioventus in certain circumstances.
Our relationships with these external partners enable us to leverage their expertise with the goal of maintaining best practices. Oversight of Third-Party Risks Our third-party service providers, suppliers, and vendors face their own risks from cybersecurity threats that could impact us in certain circumstances. We have implemented processes for overseeing and managing these risks.
The Cybersecurity Program is integrated into our enterprise risk management program and framework. These programs are designed to foster a company-wide culture of appropriate cybersecurity risk management.
The Cybersecurity Program is integrated into our enterprise risk management program and framework. These programs are designed to foster a company-wide culture of appropriate cybersecurity risk management. Our IT Security team works closely with stakeholders across technology, legal, risk, and business operations to implement and monitor the effectiveness of the Cybersecurity Program.
Our IT Security team works closely with stakeholders across technology, legal, risk, and business operations to implement and monitor the effectiveness of the Cybersecurity Program. 64 Table of Contents Engagement of Third Parties in Connection with Risk Management The Company engages a range of external experts to assist in its assessment, identification, and management of risks from cybersecurity threats.
Engagement of Third Parties in Connection with Risk Management The Company engages a range of external experts to assist in its assessment, identification, and management of risks from cybersecurity threats. These include cybersecurity consultants and external auditors to review the Company’s cybersecurity posture and responsive efforts.
Removed
We have implemented processes for overseeing and managing these risks.
Removed
Risks from Cybersecurity Threats As of the date of this Annual Report, we have not encountered any risks from cybersecurity threats that have materially affected or are reasonably likely to materially affect the Company, including its business strategy, results of operations, or financial condition.
Removed
As of the date of this Annual Report, UnitedHealth Group is still investigating this incident, including any potential impact on claims and patient data. We do not presently believe that the Change Healthcare incident has materially affected, or is reasonably likely to materially affect the Company, including with respect to our claims collection and cash flows.
Removed
We continue to evaluate the impact of the Change Healthcare incident on our Company.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe believe that our facilities are sufficient to meet our current needs and that suitable additional space will be available as and when needed on acceptable terms. 65 Table of Contents
Biggest changeWe believe that our facilities are sufficient to meet our current needs and that suitable additional space will be available as and when needed on acceptable terms.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeOn February 14, 2025, the plaintiff requested voluntary dismissal of the Vince case without prejudice and the Court granted the request that same day. 66 Table of Contents On February 20, 2025, plaintiff Jeffrey Vince refiled a Verified Stockholder Derivative Complaint against certain of Bioventus’ current and former officers and directors, naming Bioventus as a nominal defendant only, in Delaware Chancery Court, captioned Jeffrey Vince v.
Biggest changeOn February 20, 2025, plaintiff Vince refiled a derivative complaint against certain of Bioventus’ current and former officers and directors, (in which the Company is a nominal defendant), in the Delaware Chancery Court, captioned Vince, on behalf of Bioventus Inc. v. Reali et al. , No. 2025-0192-LWW (Del. Ch.).
Item 3. Legal Proceedings. Bioventus shareholder litigation On January 12, 2023, the Company and certain of its current and former directors and officers were named as defendants in a putative class action lawsuit filed in the Middle District of North Carolina (the “Court”), Ciarciello v. Bioventus Inc., No. 1:23– CV – 00032-CCE-JEP (M.D.N.C. 2023).
Item 3. Legal Proceedings. Bioventus Shareholder Litigation On January 12, 2023, the Company and certain of its current and former directors and officers were named as defendants in a putative class action lawsuit filed in the Middle District of North Carolina (the “Court”), Ciarciello v. Bioventus Inc. , No. 1:23– cv – 00032-CCE-JEP (M.D.N.C.).
On October 4, 2023, certain of the Company’s current and former directors and officers were named as defendants in a derivative shareholder lawsuit (in which the Company is a nominal defendant) filed in the United States District Court for the District of Delaware, Grogan, on behalf of Bioventus Inc., v. Reali, et al. , No. 1:23-CV-01099-RGA (D. Del. 2023).
On October 4, 2023, certain of the Company’s current and former directors and officers were named as defendants in a derivative shareholder lawsuit (in which the Company is a nominal defendant) filed in the United States District Court for the District of Delaware, Grogan, on behalf of Bioventus Inc., v. Reali, et al. , No. 1:23-CV-01099-RGA (D. Del.).
On February 9, 2024, another plaintiff filed a derivative shareholder lawsuit against certain of the Company’s current and former directors and officers (in which the Company is a nominal defendant) in the United States District Court for the District of Delaware, Sanderson, on behalf of Bioventus Inc., v. Reali, et al. , No. 1:24-cv-00180-RGA (D. Del. 2024).
On February 9, 2024, another plaintiff filed a derivative shareholder lawsuit against certain of the Company’s current and former directors and officers (in which the Company is a nominal defendant) in the United States District Court for the District of Delaware, Sanderson, on behalf of Bioventus Inc. , v. Reali, et al., No. 1:24-cv-00180-RGA (D. Del.).
The complaint asserted violations of Sections 10(b) and 20(a) of the Exchange Act and of Sections 11 and 15 of the Securities Act and generally alleges that the Company failed to disclose certain information regarding rebate practices, its business and financial prospects, and the sufficiency of internal controls regarding financial reporting. The complaint seeks damages in an unspecified amount.
The complaint asserted violations of Sections 10(b) and 20(a) of the Exchange Act and of Sections 11 and 15 of the Securities Act and generally alleges that the Company failed to disclose certain information regarding its rebate practices, its business and financial prospects, and the sufficiency of internal controls regarding financial reporting. The complaint sought damages in an unspecified amount.
The settlement amount of $15.3 million, together with interest earned thereon, has been paid by the defendants and/or the defendant’s insurers.
The settlement amount of $15.25 million, together with interest earned thereon, has been paid by the defendants and/or the defendant’s insurers.
The Court dismissed the plaintiff’s Securities Act claims, but allowed the plaintiff’s Exchange Act claims to proceed into discovery. On July 15, 2024, a Stipulation and Agreement of Settlement (the “Settlement Agreement”) by and between the lead plaintiff and the defendants was filed with the Court and the Court preliminarily approved the Settlement Agreement on August 13, 2024.
The Court dismissed the plaintiff’s Securities Act claims, but allowed the plaintiff’s Exchange Act claims to proceed into discovery. 67 Table of C o ntents On July 15, 2024, a Stipulation and Agreement of Settlement (the “Settlement Agreement”) by and between the lead plaintiff and the defendants was filed with the Court, and the Court preliminarily approved the Settlement Agreement on August 13, 2024.
The Company incurred $13.8 million of net shareholder litigation costs (including estimated settlement and reimbursement) during the year ended December 31, 2024 under the Settlement Agreement, which were recorded in selling, general and administrative expense within the consolidated condensed statements of operations and comprehensive loss.
The Company incurred $0.1 million and $13.8 million of net shareholder litigation costs (including estimated settlement and reimbursement) during the years ended December 31, 2025 and 2024, respectively, under the Settlement Agreement, which were recorded in selling, general and administrative expense within the consolidated statements of operations and comprehensive income (loss).
The complaint is identical to the Vince complaint and asserts breaches of fiduciary duties, unjust enrichment, contribution, and waste, and generally alleges the same purported misconduct as alleged in the Ciarciello case. The Defendants have not yet been served.
The complaint is nearly identical to the Vince complaint and asserts breaches of fiduciary duties, unjust enrichment, contribution, and waste, and generally alleges the same purported misconduct as alleged in the Ciarciello case.
Derivative Litigation , Case No.: 1:23-cv-01099-RGA. The Court also stayed the consolidated case. Following resolution of the Ciarciello case, on December 30, 2024, the plaintiffs in the consolidated case filed an amended complaint asserting the same claims as in the Grogan case against certain of the Company’s current and former directors and officers.
Del.). The Court also stayed the consolidated case. Following resolution of the Ciarciello case, on December 30, 2024, the plaintiffs in the consolidated case filed an amended complaint asserting the same claims as in the Grogan case against certain of the Company’s current and former directors and officers.
On July 31, 2024, another plaintiff filed a derivative complaint against certain of the Company’s current and former officers and directors, naming Bioventus as a nominal defendant only, in the United States District Court for the Middle District of North Carolina, captioned Vince v. Reali , No. 1:24-cv-006390CCEJEP (M.D.N.C. 2024).
On July 31, 2024, another plaintiff filed a derivative complaint against certain of the Company’s current and former officers and directors, (in which the Company is a nominal defendant), in the United States District Court for the Middle District of North Carolina, captioned Vince, on behalf of Bioventus Inc. v. Reali et. al. , No. 1:24-cv-00639-CCE-JEP (M.D.N.C.).
On May 1, 2024, the parties filed a stipulation to consolidate the two derivative matters and stay them on terms similar to those entered in the Grogan case. On May 2, 2024, the United States District Court for the District of Delaware granted the stipulation and ordered the consolidation of the Sanderson and Grogan cases, captioned In re Bioventus Inc.
On May 1, 2024, the parties filed a stipulation to consolidate the Sanderson and Grogan derivative matters and stay them on terms similar to those entered in the Grogan case. On May 2, 2024, the Court granted the stipulation and ordered the consolidation of the Sanderson and Grogan cases, captioned In re Bioventus Inc. Derivative Litigation , No.: 1:23-cv-01099-RGA (D.
On January 6, 2025, the Court entered a scheduling order, under which the defendants had until March 3, 2025, to file a motion to dismiss the amended complaint.
On January 6, 2025, the Court entered a scheduling order, under which the defendants had until March 3, 2025 to file a motion to dismiss the amended complaint. On February 21, 2025, the parties submitted a joint stipulation to stay the proceedings to allow the parties time to negotiate a settlement.
On February 26, 2025, plaintiff James Bouchereau filed a Verified Stockholder Derivative Complaint against certain of Bioventus’s current and former officers and directors, naming Bioventus as a nominal defendant only, in Delaware Chancery Court, captioned James Bouchereau v. Kenneth M. Reali et al ., C.A. No. 2025-___-___ (Del. Ch.).
On February 26, 2025, another plaintiff filed a derivative complaint against certain of Bioventus’s current and former officers and directors, (in which the Company is a nominal defendant), in the Delaware Court of Chancery, captioned Bouchereau, on behalf of Bioventus Inc. v. Reali et al. , No. 2025-0214-BWD (Del. Ch.).
Kenneth M. Reali et al ., C.A. No. 2025-0192-LWW (Del. Ch.). Like his prior complaint, which he voluntarily dismissed, Vince asserts breaches of fiduciary duties, unjust enrichment, contribution, and waste, and generally alleges the same purported misconduct as alleged in the Ciarciello case. The Defendants have not yet been served.
Like the prior complaint, which he voluntarily dismissed, Vince asserts breaches of fiduciary duties, unjust enrichment, contribution, and waste, and generally alleges the same purported misconduct as alleged in the Ciarciello case. On March 24, 2025, the defendants filed a motion to dismiss the complaint, or in the alternative, to stay the case.
Removed
On February 21, 2025, the parties submitted a joint stipulation to stay the proceedings to allow the parties time to negotiate a settlement, which the company expects to be in the form of governance reforms.
Added
On April 22, 2025, June 23, 2025, October 24, 2025, December 23, 2025, and February 3, 2026, the parties submitted status updates requesting more time to continue their settlement discussions.
Removed
On February 6, 2025, purported stockholder Jae Hyung Jung served a litigation demand, requesting that the Board take action against certain directors and officers for alleged breaches of fiduciary duties, gross mismanagement, unjust enrichment, waste, aiding and abetting in connection with the same conduct at issue in the litigations.
Added
On February 14, 2025, the plaintiff requested voluntary dismissal of the Vince case without prejudice and the Court granted the request that same day.
Removed
On February 7, 2025, the same purported stockholder, Jung, served a settlement demand, requesting that the Company adopt certain corporate governance reforms and agree to certain monetary payments. The Company has not yet responded to either demand. The Company believes the claims alleged in the above derivative matters lack merit and intends to defend itself vigorously.
Added
The Defendants have not yet been served. 68 Table of C o ntents On March 6, 2025, another plaintiff filed a derivative complaint against certain of Bioventus’s current and former officers and directors (in which the Company is a nominal defendant), in in the United States District Court for the Middle District of North Carolina, captioned Hyung v.
Added
Reali et al. , No. 1:25-cv-00177-CCE-JEP (M.D.N.C.). Like the other derivative cases, the Hyung case asserts violations of Section 14(a) of the Exchange Act, contribution, breaches of fiduciary duties, aiding and abetting, gross mismanagement, waste, and generally alleges the same purported misconduct as alleged in the Ciarciello case.
Added
On May 13, 2025, the defendants filed a motion to transfer the Hyung case to the United States District Court for the District of Delaware, pursuant to the forum selection clause in Bioventus’s certificate of incorporation, or in the alternative, to dismiss the case.
Added
On July 1, 2025, the Court granted the motion to transfer and transferred the Hyung case to the District of Delaware. The plaintiff subsequently filed a notice of appeal of that order to the United States Court of Appeals for the Fourth Circuit on July 16, 2025.
Added
On July 25, 2025, the plaintiff filed a joint stipulation to voluntarily dismiss the appeal. On July 8, 2025, the plaintiff filed an amended complaint in the District of Delaware, captioned Hyung v. Reali, et. al ., No. 1:25-cv-00806-RGA (D. Del.).
Added
The defendants filed a motion to dismiss the Hyung case on October 10, 2025.The motion to dismiss has been fully briefed and the parties are currently awaiting the Court’s decision. The Company believes the claims alleged in the above actions, including the pending derivative matters, lack merit and intends to defend itself vigorously.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 67 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 67 Item 6. [Reserved] 68 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 69 I tem 7A. Quantitative and Qualitative Disclosures about Market Risk 84 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 69 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 69 Item 6. [Reserved] 70 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 71 I tem 7A. Quantitative and Qualitative Disclosures about Market Risk 85 Item 8.
Removed
Financial Statements and Supplementary Data 85 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures 122 Item 9A. Controls and Procedures 123 Item 9B. Other Information 123

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeNote that historic stock price performance is not necessarily indicative of future stock price performance. 2/11/21 6/30/21 12/31/21 6/30/22 12/31/22 6/30/23 12/31/23 6/30/24 12/31/24 Bioventus Inc. $ 100.00 $ 91.62 $ 75.43 $ 35.50 $ 13.59 $ 15.04 $ 27.43 $ 29.93 $ 54.66 NASDAQ Composite $ 100.00 $ 103.41 $ 111.54 $ 78.63 $ 74.62 $ 98.30 $ 107.03 $ 126.43 $ 137.68 S&P 500 Health Care Equipment $ 100.00 $ 104.57 $ 113.11 $ 85.61 $ 90.75 $ 102.06 $ 97.83 $ 103.44 $ 107.41
Biggest changeNote that historic stock price performance is not necessarily indicative of future stock price performance. 2/11/2021 12/31/2021 12/31/2022 12/31/2023 12/31/2024 12/31/2025 Bioventus Inc. $ 100.00 $ 75.43 $ 13.59 $ 27.43 $ 54.66 $ 38.73 NASDAQ Composite $ 100.00 $ 111.54 $ 74.62 $ 107.03 $ 137.68 $ 165.71 S&P 500 Health Care Equipment $ 100.00 $ 113.11 $ 90.75 $ 97.83 $ 107.41 $ 115.17
Nasdaq Composite Index and S&P 500 Health Care Equipment Index will not be deemed incorporate by reference into any other filings under the Exchange Act or the Securities Act, except to the extent we specifically incorporate.
Nasdaq Composite Index and S&P 500 Health Care Equipment Index will not be deemed incorporated by reference into any other filings under the Exchange Act or the Securities Act, except to the extent we specifically incorporate.
The following performance graph compares the cumulative total return to stockholders on our Class A common stock relative to the cumulative total returns on the Nasdaq Composite Index and the S&P 500 Health Care Equipment Index for the period commencing on February 11, 2021 (the date our Class A common stock commenced trading on Nasdaq) through December 31, 2024 assuming an initial investment of $100.
The following performance graph compares the cumulative total return to stockholders on our Class A common stock relative to the cumulative total returns on the Nasdaq Composite Index and the S&P 500 Health Care Equipment Index for the period commencing on February 11, 2021 (the date our Class A common stock commenced trading on Nasdaq) through December 31, 2025 assuming an initial investment of $100.
As of February 27, 2025, we had one holder of record of our Class B common stock. Dividends We do not anticipate declaring or paying any cash dividends to holders of our Class A common stock in the foreseeable future. We currently intend to retain all available funds and any future earnings to finance the growth of our business.
As of February 27, 2026, we had one holder of record of our Class B common stock. Dividends We do not anticipate declaring or paying any cash dividends to holders of our Class A common stock in the foreseeable future. We currently intend to retain all available funds and any future earnings to finance the growth of our business.
As of February 27, 2025, we had approximately 256 holders of record of our Class A common stock. This amount does not take into account shareholders whose shares are held in “street name” by brokerage houses or other intermediaries. The closing price of our common stock on February 27, 2025 was $9.73.
As of February 27, 2026, we had approximately 243 holders of record of our Class A common stock. This amount does not take into account shareholders whose shares are held in “street name” by brokerage houses or other intermediaries. The closing price of our common stock on February 27, 2026 was $8.78.
Performance Graph The following performance graph is not deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C or to the liabilities of Section 18 of the Exchange Act.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters . Performance Graph The following performance graph is not deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C or to the liabilities of Section 18 of the Exchange Act.
Subsidiaries of BV LLC are generally subject to similar legal limitations on their ability to make distributions to BV LLC. Equity-based Compensation Plans The information required by Item 5 of Form 10-K regarding equity-based compensation plans is incorporated herein by reference to Part III, Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters .
Subsidiaries of BV LLC are generally subject to similar legal limitations on their ability to make distributions to BV LLC. 69 Table of C o ntents Equity-based Compensation Plans The information required by Item 5 of Form 10-K regarding equity-based compensation plans is incorporated herein by reference to Part III, Item 12.
If BV LLC makes such distributions to Bioventus Inc., the Class B common stock owner will also be entitled to receive the respective equivalent pro rata distributions in accordance with the percentages of their respective LLC Interests. 67 Table of Contents In addition, the terms of our financing arrangements contain covenants that may restrict BV LLC and its subsidiaries from paying such distributions, subject to certain exceptions.
If BV LLC makes such distributions to Bioventus Inc., the Class B common stock owner will also be entitled to receive the respective equivalent pro rata distributions in accordance with the percentages of their respective LLC Interests.
Any financing arrangements that we enter into in the future may include restrictive covenants that limit our ability to pay dividends.
In addition, the terms of our financing arrangements contain covenants that may restrict BV LLC and its subsidiaries from paying such distributions, subject to certain exceptions. Any financing arrangements that we enter into in the future may include restrictive covenants that limit our ability to pay dividends.

Item 7. Management's Discussion & Analysis

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

83 edited+58 added−57 removed50 unchanged
Biggest changeResults of Continuing Operations The following table sets forth components of our consolidated statements of operations as a percentage of net sales for the periods presented: Years Ended December 31, 2024 2023 Net sales 100.0 % 100.0 % Cost of sales (including depreciation and amortization) 32.3 % 35.9 % Gross profit 67.7 % 64.1 % Selling, general and administrative expense 59.5 % 59.4 % Research and development expense 2.4 % 2.6 % Restructuring costs — % 0.2 % Change in fair value of contingent consideration 0.2 % 0.1 % Depreciation and amortization 1.3 % 1.7 % Impairment of assets 6.3 % 15.4 % Loss on disposals 0.1 % 0.7 % Operating loss (2.1 %) (16.0 %) 73 Table of Contents The following table presents a reconciliation of net loss from continuing operations to Adjusted EBITDA for the periods presented: Years Ended December 31, (in thousands) 2024 2023 Net loss from continuing operations $ (43,833) $ (121,196) Interest expense, net 38,792 40,676 Income tax expense (benefit), net (5,293) 85 Depreciation and amortization (a) 49,555 57,365 Acquisition and related costs (b) 1,339 5,694 Shareholder litigation costs (c) 13,802 — Restructuring and succession charges (d) (57) 2,331 Equity-based compensation (e) 10,058 2,722 Financial restructuring costs (f) 351 7,291 Impairment of assets (g) 36,357 78,615 Loss on disposal of a business (h) 292 1,539 Other items (i) 7,519 13,740 Adjusted EBITDA $ 108,882 $ 88,862 (a) Includes for the years ended December 31, 2024 and 2023, respectively, depreciation and amortization of $41.9 million and $48.5 million in cost of sales and $7.7 million and $8.9 million in operating expenses presented in the consolidated statements of operations and comprehensive loss.
Biggest changeGAAP measure. 74 Table of C o ntents Results of Operations The following table sets forth components of our consolidated statements of operations as a percentage of net sales for the periods presented: Years Ended December 31, 2025 2024 Net sales 100.0 % 100.0 % Cost of sales (including depreciation and amortization) 31.7 % 32.3 % Gross profit 68.3 % 67.7 % Selling, general and administrative expense 55.3 % 60.1 % Research and development expense 2.1 % 2.4 % Restructuring costs 0.4 % — % Change in fair value of contingent consideration — % 0.2 % Depreciation and amortization 1.0 % 1.3 % Impairment of assets — % 6.3 % Loss on disposals — % 0.1 % Operating income (loss) 9.5 % (2.7 %) The following table presents a reconciliation of net income (loss) to Adjusted EBITDA for the periods presented: Years Ended December 31, (in thousands) 2025 2024 Net income (loss) $ 27,274 $ (47,049) Interest expense, net 26,486 38,792 Income tax benefit, net (1,565) (5,293) Depreciation and amortization (a) 47,011 49,555 Acquisition and related costs (b) — 1,339 Shareholder litigation costs (c) 51 13,802 Restructuring costs (d) 2,235 (57) Equity-based compensation (e) 12,673 13,274 Debt refinancing (f) 902 351 Loss on extinguishment (g) 326 — Impairment of assets (h) — 36,357 Loss on disposal of a business (i) 81 292 Other items (j) 803 7,519 Adjusted EBITDA $ 116,277 $ 108,882 (a) Includes for the years ended December 31, 2025 and 2024, respectively, depreciation and amortization of $41.3 million and $41.9 million in cost of sales and $5.7 million and $7.7 million in operating expenses presented in the consolidated statements of operations and comprehensive income (loss).
Non-GAAP financial measures have limitations as an analytical tool and should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with U.S. GAAP. These measures might exclude certain normal recurring expenses.
Non-GAAP financial measures have limitations as an analytical tool and should not be considered in isolation or as a substitute for, or as superior to, the financial information prepared and presented in accordance with U.S. GAAP. These measures might exclude certain normal recurring expenses.
Investors are encouraged to review the reconciliation of the non-GAAP measure provided in this Annual Report on Form 10-K, including all tables referencing Adjusted EBITDA to its most directly comparable U.S. GAAP measure.
Investors are encouraged to review the reconciliation of the non-GAAP measure provided in this Annual Report on Form 10-K, including all tables referencing Adjusted EBITDA to its most directly comparable U.S.
Gains and losses are recorded with selling, general and administrative expenses within the consolidated statements of operations and comprehensive loss. Impairment of goodwill and indefinite-lived intangible assets We evaluate goodwill for impairment annually during the fourth quarter, or more frequently if events or changes in circumstances indicate that the asset might be impaired.
Gains and losses are recorded in selling, general and administrative expenses within the consolidated statements of operations and comprehensive income (loss). Impairment of Goodwill and Indefinite-Lived Intangible Assets We evaluate goodwill for impairment annually during the fourth quarter, or more frequently if events or changes in circumstances indicate that the asset might be impaired.
This portfolio also enables precision ultrasonic neuro and general surgery to address brain tumors and pathologies of the liver and other organs. ◦ Bone Graft Substitutes (“BGS”) : Our product portfolio includes a range of products that facilitate optimal bone fusion following a surgical procedure. • Restorative Therapies, comprised of: ◦ Fracture Care: We provide low-intensity pulse ultrasound to help patients who suffer from bone fractures that do not heal through traditional methods.
This portfolio also enables precision ultrasonic neuro and general surgery to address brain tumors and pathologies of the liver and other organs. ◦ Bone Graft Substitutes (“BGS”) : Our BGS product portfolio includes a range of products that facilitate optimal bone fusion following a surgical procedure. • Restorative Therapies , consisting of: ◦ Fracture Care: We provide low-intensity pulse ultrasound to help patients who suffer from bone fractures that do not heal through traditional methods.
Where appropriate, these estimates take into consideration a range of possible outcomes, which are probability-weighted for relevant factors such as our historical experiences, current contractual requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns.
Where appropriate, these estimates take into consideration a range of possible outcomes, which are probability-weighted for relevant factors such as our historical experience, current contractual requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns.
We discount future cash flows based on a market comparable weighted average cost of capital rate for each reporting unit. The discount rates used in the discounted free cash flow analyses reflect the risks inherent in the expected future cash flows generated by the respective intangible assets.
We discounted future cash flows based on a market comparable weighted average cost of capital rate for each reporting unit. The discount rates used in the discounted free cash flow analyses reflected the risks inherent in the expected future cash flows generated by the respective intangible assets.
(c) Amounts that are contractually committed to as of December 31, 2024 related to multi-year exclusive supply agreements. Generally, our purchase obligations under these supply agreements are based on forecasted requirements, subject in some cases to an annual contractual minimum.
(c) Amounts that are contractually committed to as of December 31, 2025 related to multi-year exclusive supply agreements. Generally, our purchase obligations under these supply agreements are based on forecasted requirements, subject in some cases to an annual contractual minimum.
A discussion of the year ended December 31, 2023 compared to the year ended December 31, 2022 has been reported previously in our Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on March 12, 2024, under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations." Executive Summary We are a global medical device company focused on helping patients recover and live life to the fullest by relieving pain and addressing musculoskeletal challenges through a diverse portfolio of high-quality, innovative, and clinically-proven solutions.
A discussion of the year ended December 31, 2024 compared to the year ended December 31, 2023 has been reported previously in our Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on March 11, 2025, under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations." Executive Summary We are a global medical device company focused on helping patients recover and live life to the fullest by relieving pain and addressing musculoskeletal challenges through a diverse portfolio of high-quality, innovative, and clinically proven solutions.
Certain of our more critical accounting policies require the application of significant judgment by management in selecting the appropriate assumptions for calculating financial estimates. By their nature, these judgments are subject to an inherent degree of uncertainty. 80 Table of Contents We use historical experience and other assumptions as the basis for our judgments in making these estimates.
Certain of our more critical accounting policies require the application of significant judgment by management in selecting the appropriate assumptions for calculating financial estimates. By their nature, these judgments are subject to an inherent degree of uncertainty. We use historical experience and other assumptions as the basis for our judgments in making these estimates.
Each of these factors and assumptions can significantly affect the value of the intangible asset. 81 Table of Contents Acquired in-process research and development (“IPR&D”) is the fair value of projects for which the related products have not received regulatory approval and have no alternative future use and is capitalized as an indefinite-lived intangible asset.
Each of these factors and assumptions can significantly affect the value of the intangible asset. Acquired in-process research and development (“IPR&D”) is the fair value of projects for which the related products have not received regulatory approval and have no alternative future use and is capitalized as an indefinite-lived intangible asset.
Significant judgments inherent in this analysis include estimating the amount and timing of future cash flows and the selection of appropriate discount rates, royalty rate and long-term growth rate assumptions.
Significant judgments inherent in this analysis included estimating the amount and timing of future cash flows and the selection of appropriate discount rates, royalty rates and long-term growth rate assumptions.
However, over time, as we grow our net sales, we expect selling, general and administrative expenses to decline as a percentage of net sales. 71 Table of Contents Research and development expense Research and development expense primarily consists of employee compensation, equity-based compensation and related expenses, as well as contract research organization service expenses related to clinical trials.
However, over time, as we grow our net sales, we expect selling, general and administrative expenses to decline as a percentage of net sales. Research and Development Expense Research and development expense primarily consists of employee compensation, equity-based compensation and related expenses, as well as contract research organization service expenses related to clinical trials.
We define Adjusted EBITDA as net loss from continuing operations before depreciation and amortization, provision of income taxes and interest expense, net, adjusted for the impact of certain cash, non-cash and other items that we do not consider in our evaluation of ongoing operating performance.
We define Adjusted EBITDA as net income (loss) before depreciation and amortization, provision of income taxes and interest expense, net, adjusted for the impact of certain cash, non-cash and other items that we do not consider in our evaluation of ongoing operating performance.
(“Continuing LLC Owner”) 85% of the amount of any realized tax benefits (or in some circumstances are deemed to realize) resulting from (i) increases in the tax basis of assets of BV LLC as a result of (a) any future redemptions or exchanges of LLC Interests and (b) certain distributions (or deemed distributions) by BV LLC and (ii) certain other tax benefits arising from our making payments under the TRA.
(“Continuing LLC Owner”) 85% of the amount of any realized tax benefits (or in some circumstances are deemed to realize) resulting from (i) increases in the tax basis of assets of BV LLC as a result of (a) any future redemptions or exchanges of LLC Interests and (b) certain distributions (or deemed distributions) by BV LLC and (ii) certain other tax benefits arising from payments we make under the TRA.
Amortization expense primarily consists of amortization expense related to customer relationships and other intangible assets. Interest expense Interest expense primarily consists of interest on our indebtedness, which currently consists of our term loan and revolving credit facility, which was incurred pursuant to the Amended 2019 Credit Agreement.
Amortization expense primarily consists of amortization expense related to customer relationships and other intangible assets. Interest Expense Interest expense primarily consists of interest on our indebtedness, which currently consists of our term loan and revolving credit facility, which was incurred pursuant to the 2025 Credit Agreement.
Adjusted EBITDA by segment is comprised of net sales and costs directly attributable to a segment, as well as an allocation of corporate overhead costs primarily based on a ratio of net sales by segment to total consolidated net sales.
Adjusted EBITDA by segment consists of net sales and costs directly attributable to a segment, as well as an allocation of corporate overhead costs primarily based on a ratio of net sales by segment to total consolidated net sales.
Components of our results of operations Net sales We generate net sales from a portfolio of active healing products that serve physicians spanning the orthopedic continuum, including sports medicine, total joint reconstruction, hand and upper extremities, foot and ankle, podiatric surgery, trauma, spine and neurosurgery. We report sales net of contractual allowances, rebates and returns.
Components of our results of operations Net Sales We generate net sales from a portfolio of active healing products that serve physicians spanning the orthopedic continuum, including sports medicine, total joint reconstruction, hand and upper extremities, foot and ankle, podiatric surgery, trauma, spine and neurosurgery.
Our impairment process includes applying a quantitative impairment analysis to the fair value of the reporting unit and comparing it to its carrying value. We used independent third-party valuation specialists in 2024 and 2023 using year-to-date October data in each year to assist management in performing our annual impairment evaluation.
Our impairment process in 2024 included applying a quantitative impairment analysis to the fair value of the reporting unit and comparing it to its carrying value. We used independent third-party valuation specialists and year-to-date October data to assist management in performing the 2024 annual impairment evaluation.
Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note 3. Balance sheet information. Equity-based compensation Equity-based compensation expense generated from the granting of restricted stock units represents the fair value of the stock measured at the market price on the date of grant.
Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note 3. Balance Sheet Information for further discussion regarding goodwill . Equity-Based Compensation Equity-based compensation expense generated from the granting of restricted stock units represents the fair value of the stock measured at the market price on the date of grant.
We determine the fair value of U.S. and International reporting units based primarily on an income approach, which incorporates the use of a discounted free cash flow analysis. The discounted free cash flow analysis is based on significant judgments, including the current operating budgets, estimated long-term growth projections and future forecasts for each reporting unit.
We determined the fair value of U.S. and International reporting units based primarily on an income approach, which incorporated the use of a discounted free cash flow analysis. The discounted free cash flow analysis was based on significant judgments, including the current operating budgets, estimated long-term growth projections and future forecasts for each reporting unit.
We will continue to qualify as an emerging growth company until the earliest of: • The last day of our fiscal year following the fifth anniversary of the date of our IPO; • The last day of our fiscal year in which have annual gross revenues of $1.235 billion or more; • The date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt; • The date on which we are deemed to be a “large accelerated filer”, which will occur at such time as we (1) have an aggregate worldwide market value of common equity securities held by non-affiliates of $700 million or more as of the last business day of our second fiscal quarter, (2) have been required to file annual and quarterly reports under the Exchange Act for a period of at least 12 months, (3) have filed at least one annual report pursuant to the Exchange Act, and (4) are not eligible to use the requirements for smaller reporting companies as defined in Rule 12b-2 under the Exchange Act (annual revenue less than $100 million and either no public float or a public float of less than $700 million). 83 Table of Contents Additionally, we are considered a “smaller reporting company,” as defined by Rule 12b-2 of the Exchange Act, which was determined as of the last day of our second fiscal quarter of 2024 (a “determination date”).
We will continue to qualify as an emerging growth company until the earliest of: • December 31, 2026 (the last day of our fiscal year following the fifth anniversary of the date of our IPO); • The last day of our fiscal year in which we have annual gross revenues of $1.235 billion or more; • The date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt; • The date on which we are deemed to be a “large accelerated filer,” which will occur at such time as we (1) have an aggregate worldwide market value of common equity securities held by non-affiliates of $700 million or more as of the last business day of our second fiscal quarter, (2) have been required to file annual and quarterly reports under the Exchange Act for a period of at least 12 months, (3) have filed at least one annual report pursuant to the Exchange Act, and (4) are not eligible to use the requirements for smaller reporting companies as defined in Rule 12b-2 under the Exchange Act (annual revenue less than $100 million and either no public float or a public float of less than $700 million).
We base the allowance on an assessment of customer creditworthiness, historical payment experience, the age of outstanding receivables and other information as applicable. Fair value We record certain assets and liabilities at fair value.
We base the allowance on an assessment of customer creditworthiness, historical payment experience, the age of outstanding receivables and other information, as applicable. 82 Table of C o ntents Fair Value We record certain assets and liabilities at fair value.
Payments due upon cancellation generally consist only of payments for services provided or expenses incurred, including non-cancellable obligations of our service providers, up to the date of cancellation. Certain agreements include contingent events that upon occurrence would require payment. For information regarding Commitments and Contingencies, refer to Item 8.
Payments due upon cancellation generally consist only of payments for services provided or expenses incurred, including non-cancellable obligations of our service providers, up to the date of cancellation. Certain agreements include contingent events that upon occurrence would require payment. For information regarding Commitments and Contingencies, refer to Item 8. Financial Statements and Supplementary Data in this Annual Report.
Identifying and calculating the cost to exit operations requires certain assumptions to be made, the most significant of which are anticipated future liabilities. Although our estimates have been reasonably accurate in the past, significant judgment is required, and these estimates and assumptions may change as additional information becomes available and facts or circumstances change.
Identifying and calculating the cost to exit operations requires certain assumptions, the most significant of which are anticipated future liabilities. Although our estimates have been reasonably accurate in the past, significant judgment is required, and these estimates and assumptions may change as additional information becomes available and facts or circumstances change. Restructuring costs are recorded at estimated fair value.
The value of each reporting unit is determined on a stand-alone basis from the perspective of a market participant and represents the price we estimate we would receive in a sale of the reporting unit in an orderly transaction between market participants at the measurement date.
The value of each reporting unit was determined on a stand-alone basis from the perspective of a market participant and represents the price we estimated we would have received in a sale of the reporting unit in an orderly transaction between market participants at the measurement date.
Market risk, industry risk and a small company premium has an impact on the discount rate.
Market risk, industry risk and a small company premium had impact on the discount rate.
We establish reserves for the estimated variable consideration based on the amounts earned or eligible for claim on the related sales.
We establish reserves for the estimated variable consideration based on the amounts earned or eligible to be claimed on the related sales.
Income tax expense The Company’s subsidiary, Bioventus LLC (“BV LLC”), is a partnership for U.S. federal tax purposes. Accordingly, the members include the profits and losses of BV LLC in their income tax returns. Certain wholly-owned subsidiaries of BV LLC are taxable entities for U.S. or foreign tax purposes and file tax returns in their local jurisdictions.
Accordingly, the members include the profits and losses of BV LLC in their income tax returns. Certain wholly-owned subsidiaries of BV LLC are taxable entities for U.S. or foreign tax purposes and file tax returns in their local jurisdictions.
We plan to expand our United States clinical indications to address the healing of fresh fractures, especially for high-risk patients.
We plan to expand our U.S. clinical fracture care indications to address the healing of fresh fractures, especially for high-risk patients.
Financial Statements and Supplementary Data in this Annual Report. 78 Table of Contents Tax Receivable Agreement The BV LLC Agreement provides for the payment of certain distributions to the Continuing LLC Owner in amounts sufficient to cover the income taxes imposed with respect to the allocation of taxable income from BV LLC as well as obligations within the TRA.
Tax Receivable Agreement The BV LLC Agreement provides for the payment of certain distributions to the Continuing LLC Owner in amounts sufficient to cover the income taxes imposed with respect to the allocation of taxable income from BV LLC as well as obligations within the TRA.
We report the income tax effects of these differences as deferred income taxes. Valuation allowances recognized reduce the related deferred tax assets to an amount which will, more likely than not, be realized.
We report the income tax effects of these differences as deferred income taxes. Valuation allowances recognized reduce the related deferred tax assets to an amount which are more likely than not to be realized. We recognize interest and penalties related to unrecognized tax benefits as a component of income tax expense.
We recognize interest and penalties related to unrecognized tax benefits as a component of income tax expense. 72 Table of Contents Non-GAAP Financial Measures - Adjusted EBITDA We present Adjusted EBITDA, a non-GAAP financial measure, because we believe it is a useful indicator that management uses to measure operating performance and for planning purposes, including the preparation of our annual operating budget and financial projections.
Non-GAAP Financial Measures - Adjusted EBITDA We present Adjusted EBITDA, a non-GAAP financial measure, because we believe it is a useful indicator that management uses to measure operating performance and for planning purposes, including the preparation of our annual operating budget and financial projections.
If we raise additional funds through collaboration and licensing arrangements with third parties, it might be necessary to relinquish valuable rights to our products, future revenue streams or product candidates, or to grant licenses on terms that might not be favorable to us. We cannot be certain that additional funding will be available on acceptable terms, or at all.
If we raise additional funds by issuing equity securities or convertible debt, our stockholders will experience dilution. If we raise additional funds through collaboration and licensing arrangements with third parties, it might be necessary to relinquish valuable rights to our products, future revenue streams or product candidates, or to grant licenses on terms that might not be favorable to us.
We operate our business through two reporting segments, U.S. and International, and our portfolio of products is comprised of five patient-focused areas, grouped into three businesses based on clinical use: (i) Pain Treatments, (ii) Surgical Solutions and (iii) Restorative Therapies. • Pain Treatments, comprised of: ◦ Knee Osteoarthritis (“KOA”) area : Our product portfolio includes a range of intra-articular, hyaluronic acid (“HA”) injections that help relieve patient discomfort and improve quality of life. ◦ Peripheral Nerve Stimulation (“PNS”) area: We are focused on developing a full portfolio of peripheral nerve stimulation products with solutions for acute, temporary and chronic pain. • Surgical Solutions, comprised of: ◦ Ultrasonics: Our Ultrasonics business offers precision bone resection for patients with degenerative spine conditions and spinal deformities.
We operate our business through two reporting segments, U.S. and International, and our portfolio of products is comprised of five patient-focused areas, grouped into three businesses based on clinical use: (i) Pain Treatments & PRP (“Pain Treatments”), (ii) Surgical Solutions and (iii) Restorative Therapies. • Pain Treatments , consisting of: ◦ Knee Osteoarthritis (“KOA”) : Our product portfolio includes a range of intra-articular, hyaluronic acid (“HA”) injections that help relieve patient discomfort and improve quality of life.
We analyze all other indefinite-lived intangible assets qualitatively to determine if it is more likely than not that an impairment exists. If we meet the criteria, we perform a quantitative analysis to determine if an impairment exists. Our reporting units are U.S. and International and we analyze each reporting unit separately in our impairment evaluations.
We analyze all other indefinite-lived intangible assets qualitatively to determine if it is more likely than not that an impairment exists. If we meet the qualitative criteria, we perform a quantitative analysis to determine if an impairment exists.
We generally recognize revenue at the point in time when control is transferred to the customer, for example, when the product is shipped to the customer, when the patient has accepted the product or upon consumption in a surgical procedure.
Financial Statements and Supplementary Data—Notes to Consolidated Financial Statements—Note 2. Significant Accounting Policies for further information. We generally recognize revenue at the point in time when control is transferred to the customer, for example, when the product is shipped to the customer, when the patient has accepted the product or upon consumption in a surgical procedure.
The amount of variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. We regularly review all reserves and update them at the end of each reporting period as needed.
The amount of variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period.
These items include acquisition and divestiture related costs, certain shareholder litigation costs, impairments of assets, restructuring and succession charges, equity-based compensation expense, financial restructuring costs and other items.
These items include acquisition and divestiture related costs, certain shareholder litigation costs, impairment of assets, restructuring costs, equity-based compensation expense, debt refinancing, loss on extinguishment of debt, and other items.
Changes in estimates and assumptions could materially affect the determination of fair value for each reporting unit and could result in an impairment charge, which could be material to our financial position and results of operations.
Changes in estimates and assumptions could materially affect the determination of fair value for each reporting unit and could result in an impairment charge, which could be material to our financial position and results of operations. There were no goodwill impairment charges for the years ended December 31, 2025, 2024 or 2023. Refer to Item 8.
We may also receive an aggregate of $20.0 million in potential earn-out payments, which are based on the achievement of certain revenue and financial metric thresholds in respect to sales of products from the Advanced Rehabilitation Business during the 2025 and 2026 fiscal years.
We may also receive an aggregate of $20.0 million in potential earn-out payments based on the achievement of certain revenue and financial performance thresholds related to the Advanced Rehabilitation Business during the fiscal years ending December 31, 2025 and 2026. The revenue and specified financial performance criteria for the fiscal year ended December 31, 2025 were not achieved.
We have previously entered into interest rate swaps to limit our exposure to changes in the variable interest rate on our term loan. Interest expense includes any fair value gain or losses on these swaps.
We have entered into interest rate swaps to limit our exposure to changes in the variable interest rate on our 2025 Term Loan. Interest expense includes any fair value gain or losses on these swaps. Other Expense Other expense primarily consists of foreign currency transaction and remeasurement gains and losses on transactions denominated in currencies other than our functional currency.
Any failure to raise capital in the future might have a negative impact on our financial condition and our ability to pursue our business strategies. Future cash requirements The following table summarizes certain estimated future cash requirements under our various contractual obligations committed to as of December 31, 2024 in total and disaggregated into current and long-term obligations.
Future Cash Requirements The following table summarizes certain estimated future cash requirements under our various contractual obligations committed to as of December 31, 2025 in total and disaggregated into current and long-term obligations.
Change in fair value of contingent consideration Years Ended December 31, Change (in thousands, except for percentage) 2024 2023 $ % Change in fair value of contingent consideration $ 1,423 $ 719 $ 704 97.9 % Changes in fair value for both periods relates to contingent consideration associated with the acquisition of Bioness in March 2021.
Change in Fair Value of Contingent Consideration Years Ended December 31, Change (in thousands, except for percentage) 2025 2024 $ % Change in fair value of contingent consideration $ — $ 1,423 $ (1,423) (100.0 %) Activity from the change in fair value of contingent consideration relates to the acquisition of Bioness in 2021.
(g) Activity in 2024 includes: (i) a non-cash impairment charge of $33.9 million for intangible assets solely attributable to our Advanced Rehabilitation Business due to the decision to divest the business and (ii) a non-cash impairment charge of $2.5 million for rented right-of-use assets involving exited office and warehouse spaces.
(g) Losses recognized in connection with the refinancing of long-term debt. 75 Table of C o ntents (h) Includes a non-cash impairment charge of $33.9 million for intangible assets solely attributable to our Advanced Rehabilitation Business, driven by the decision to divest and a $2.5 million non-cash impairment charge for right-of-use assets associated with exited office and warehouse spaces.
We based the fair value of its intangibles on the consideration agreed to with the purchaser for the Advanced Rehabilitation Business. We also recorded impairment losses of $2.5 million during the year ended December 31, 2024 for 2 right-of-use assets, specifically office and warehouse spaces, which the Company exited during 2024.
Based on this evaluation, we recorded a $33.9 million impairment to reduce intangible assets to fair value less costs to sell, using the consideration agreed upon with the purchaser. Additionally, we recognized $2.5 million of impairment losses during the year ended December 31, 2024 for two right-of-use assets—office and warehouse spaces—that the Company exited during the year.
Each quarter, we update our estimate of our annual effective tax rate, and if the estimated annual effective tax rate changes, we make a cumulative adjustment in such period.
Income Taxes The tax provision for interim periods is determined using an estimate of our annual effective tax rate, adjusted for discrete items, if any, that arise during the period. Each quarter, we update our estimate of our annual effective tax rate, and if the estimated annual effective tax rate changes, we make a cumulative adjustment in such period.
(b) Includes acquisition and integration costs related to completed acquisitions and changes in fair value of contingent consideration. (c) Costs incurred as a result of certain shareholder litigation unrelated to our ongoing operations. (d) Costs incurred were the result of adopting restructuring plans to reduce headcount, contract termination, reorganize management structure and consolidate certain facilities.
(b) Includes acquisition and integration costs related to completed acquisitions and changes in fair value of contingent consideration. (c) Costs incurred as a result of certain shareholder litigation unrelated to our ongoing operations. (d) Restructuring costs in 2025 primarily related to severance associated with the elimination of several positions and the consolidation of certain administrative functions and roles.
Other (income) expense Other (income) expense primarily consists of foreign currency transaction and remeasurement gains and losses on transactions denominated in currencies other than our functional currency. Our foreign currency transaction and remeasurement gains and losses are primarily related to foreign currency denominated cash, liabilities and intercompany receivables and payables. Other (income) expense may also include certain nonrecurring items.
Our foreign currency transaction and remeasurement gains and losses are primarily related to cash, liabilities and intercompany receivables and payables denominated in foreign currency. Other expense may also include certain nonrecurring items. Income Tax Expense The Company’s subsidiary, Bioventus LLC (“BV LLC”), is a partnership for U.S. federal tax purposes.
During the year ended December 31, 2024, other items primarily consisted of the following: (i) divestiture costs related to the Company’s Advanced Rehabilitation Business, including transactional fees, totaled $4.7 million; (ii) transformative project costs of $1.7 million; and (iii) strategic transaction costs of $0.4 million.
Other items during the year ended December 31, 2024 primarily consisted of $4.7 million, net of transactional fees, of expenses related to the divestiture of the Advanced Rehabilitation Business and transformative project costs of $1.7 million. Net Sales Years Ended December 31, Change (in thousands, except for percentage) 2025 2024 $ % U.S.
We may explore divestiture opportunities for non-core assets to improve our liquidity position. In addition, we may raise additional funds to finance future cash needs through receivables or royalty financings or corporate collaboration and licensing arrangements. If we raise additional funds by issuing equity securities or convertible debt, our stockholders will experience dilution.
Our ability to access these sources will depend on market conditions, our financial performance, and other factors. 79 Table of C o ntents We may explore divestiture opportunities for non-core assets to improve our liquidity position. In addition, we may raise additional funds to finance future cash needs through receivables or royalty financings or corporate collaboration and licensing arrangements.
Segment Adjusted EBITDA Adjusted EBITDA for each of our reportable segments is as follows: Years Ended December 31, Change (in thousands, except for percentage) 2024 2023 $ % U.S. $ 95,421 $ 78,668 $ 16,753 21.3 % International $ 13,461 $ 10,194 $ 3,267 32.0 % U.S.
Segment Adjusted EBITDA Adjusted EBITDA for each of our reportable segments is as follows: Years Ended December 31, Change (in thousands, except for percentage) 2025 2024 $ % U.S. $ 100,967 $ 95,421 $ 5,546 5.8 % International $ 15,310 $ 13,461 $ 1,849 13.7 % 78 Table of C o ntents U.S.
We sell our products primarily through our direct sales team, which manages and maintains the sales relationship with healthcare providers, distribution centers or specialty pharmacies. Certain Surgical Solutions products are sold through independent distributors to hospitals so our neurosurgeon and orthopedic spine surgeon customers can use them in procedures.
Certain Surgical Solutions products are sold through independent distributors to hospitals so our neurosurgeon and orthopedic spine surgeon customers can use them in procedures. In certain international markets, we also sell to independent distributors on prearranged business terms, who manage or maintain the sales relationship with their physician customers. Refer to Item 8.
As of December 31, 2024, $22.1 million and $19.5 million of our cash and cash equivalents was held within the U.S. and International segments, respectively.
Information Regarding Cash Flows Cash and cash equivalents as of December 31, 2025 totaled $51.2 million, compared to $41.6 million as of December 31, 2024. As of December 31, 2025, $41.3 million and $9.9 million of our cash and cash equivalents was held within the U.S. and International segments, respectively.
Assumptions used in determining stock option fair value include the risk-free interest rate, expected dividend yield, expected price volatility, expected life of stock options and weighted-average fair value of stock options granted. The expected term of the options granted is estimated using the simplified method. Expected volatility is based on the historical volatility of our peers’ common stock.
The fair value of time-based stock options is determined using the Black-Scholes valuation model, with such value recognized as expense over the service period, net of actual forfeitures. Assumptions used in determining stock option fair value include the risk-free interest rate, expected dividend yield, expected price volatility, expected life of stock options and weighted-average fair value of stock options granted.
We recognize a tax benefit from any uncertain tax positions only if they are more likely than not to be sustained upon examination based on the technical merits of the position.
The release of all or part of the valuation allowance against deferred tax assets may cause greater volatility in the effective tax rate in the periods in which it is reversed. 84 Table of C o ntents We recognize a tax benefit from any uncertain tax positions only if they are more likely than not to be sustained upon examination based on the technical merits of the position.
Restructuring costs recorded in 2023 and 2022 are the result of aligning our organizational and management cost structure to improve profitability and cash flow. Depreciation and amortization Depreciation expense primarily consists of depreciation of computer equipment and software as well as demonstration and consignment inventory, leasehold improvements, furniture, fixtures, machinery and equipment.
In 2025, restructuring costs primarily related to severance costs associated with the elimination of several positions in order to optimize our organizational structure. 73 Table of C o ntents Depreciation and Amortization Depreciation expense primarily consists of depreciation of computer equipment and software as well as demonstration and consignment inventory, leasehold improvements, furniture, fixtures, machinery and equipment.
On December 31, 2024, we closed the sale of the Advanced Rehabilitation Business and received $24.7 million at closing, net of transactional fees, subject to a post-closing adjustment for net working capital.
The Advanced Rehabilitation Business was considered non-core and required additional research and development investment to achieve its next stage of growth. We received $24.7 million of cash proceeds at closing, net of transactional fees, which were subject to a post-closing adjustment for net working capital.
Restructuring costs are recorded at estimated fair value. Key assumptions in determining the restructuring costs include negotiated terms and payments to terminate contractual obligations. Restructuring costs primarily consist of employee severance, legal, consulting and temporary labor expenses.
Key assumptions in determining the restructuring costs include negotiated terms and payments to terminate contractual obligations.
Gross profit and gross margin Years Ended December 31, Change (in thousands, except for percentage) 2024 2023 $ % U.S. $ 348,953 $ 294,366 $ 54,587 18.5 % International 39,273 33,827 5,446 16.1 % Total $ 388,226 $ 328,193 $ 60,033 18.3 % Years Ended December 31, 2024 2023 Change U.S. 68.9 % 65.4 % 3.5 % International 59.1 % 54.1 % 5.0 % Total 67.7 % 64.1 % 3.6 % U.S.
Gross Profit and Gross Margin Years Ended December 31, Change (in thousands, except for percentage) 2025 2024 $ % U.S. $ 350,004 $ 348,953 $ 1,051 0.3 % International 38,153 39,273 (1,120) (2.9 %) Total $ 388,157 $ 388,226 $ (69) — % Years Ended December 31, 2025 2024 Change U.S. 69.7 % 68.9 % 0.8 % International 57.8 % 59.1 % (1.3 %) Total 68.3 % 67.7 % 0.6 % 76 Table of C o ntents U.S.
Significant accounting policies for a further description of our significant accounting policies, however, we believe that the following accounting estimates are considered critical to our business in order to obtain a full understanding and to evaluate our reported financial results.
Significant Accounting Policies for a further description of our significant accounting policies. The critical accounting estimates discussed below represent the most significant judgments and assumptions we use to prepare our consolidated financial statements and are important to understanding and interpreting our reported results.
The risk-free interest rate is determined based upon a constant U.S. Treasury security rate with a contractual life that approximates the expected term of the option. Income taxes The tax provision for interim periods is determined using an estimate of our annual effective tax rate, adjusted for discrete items, if any, that arise during the period.
The expected term of the options granted is estimated using the simplified method. Expected volatility is based on the historical volatility of our peers’ common stock. The risk-free interest rate is determined based upon a constant U.S. Treasury security rate with a contractual life that approximates the expected term of the option.
Other (income) expense during 2024 primarily consisted of an increase of $1.0 million in foreign currency gains, resulting from recognizing previously unrealized gains and losses on the assets and liabilities of the Advanced Rehabilitation Business, which was sold in the fourth quarter of 2024. Activity during 2023 primarily included a $1.5 million receipt from the settlement of a legal claim.
Other income, net during 2024 primarily reflected foreign currency gains, inclusive of a $1.0 million gain related to the recognition of previously unrealized gains and losses on the assets and liabilities of the Advanced Rehabilitation Business.
Other (income) expense Years Ended December 31, Change (in thousands, except for percentage) 2024 2023 $ % Interest expense, net $ 38,792 $ 40,676 $ (1,884) (4.6 %) Other (income) expense $ (1,645) $ (1,290) $ (355) 27.5 % Interest expense, net decreased during the year ended December 31, 2024 compared to the prior year primarily due to less debt outstanding and a decrease in interest rates.
Other Expense (Income) Years Ended December 31, Change (in thousands, except for percentage) 2025 2024 $ % Interest expense, net $ 26,486 $ 38,792 $ (12,306) (31.7 %) Loss on extinguishment $ 326 $ — $ 326 NM Other expense (income) $ 1,454 $ (1,645) $ 3,099 (188.4 %) Interest expense, net decreased during the year ended December 31, 2025 compared to the prior year.
Refer to Item 8. Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note 5. Financial instruments in this Annual Report for further details on the Company’s indebtedness. Information regarding cash flows Cash and cash equivalents as of December 31, 2024 totaled $41.6 million, compared to $37.0 million as of December 31, 2023.
As of December 31, 2025, we had $294.0 million outstanding under the 2025 Term Loan, net of original issue discount and deferred financing costs, and no outstanding borrowings under the 2025 Revolver. Refer to Item 8. Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note 5. Financial Instruments for further details on the Company’s indebtedness.
Depreciation and amortization Years Ended December 31, Change (in thousands, except for percentage) 2024 2023 $ % Depreciation and amortization $ 7,652 $ 8,842 $ (1,190) (13.5 %) Depreciation and amortization decreased during the year ended December 31, 2024 compared with the prior year primarily due to the write-off of consigned fixed assets and fewer assets to depreciate due to divestitures.
Depreciation and Amortization Years Ended December 31, Change (in thousands, except for percentage) 2025 2024 $ % Depreciation and amortization $ 5,727 $ 7,652 $ (1,925) (25.2 %) Depreciation and amortization decreased during the year ended December 31, 2025 compared with the prior year primarily due to certain information technology assets being fully depreciated in 2025. 77 Table of C o ntents Impairment of Assets In 2024, we evaluated the Advanced Rehabilitation Business for impairment following our decision to divest.
We anticipate that to the extent that we require capital, we will obtain funding through additional equity financings or the incurrence of other indebtedness or a combination of these potential sources of capital. As of December 31, 2024, we have the ability to borrow up to $40.0 million using our Revolving Credit Facility and available letters of credit.
We anticipate that, to the extent additional capital is required, we will seek funding through a combination of equity financings, the incurrence of additional indebtedness, or other strategic sources of capital.
(in thousands) Current Long-Term Total Long-term debt (a) $ 27,339 $ 310,525 $ 337,864 Interest payments on long-term debt obligations (a) 28,974 21,442 50,416 Lease liabilities (b) 5,104 20,104 25,208 Purchase commitments (c) 29,196 1,223 30,419 $ 90,613 $ 353,294 $ 443,907 (a) Refer to Item 8. Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note 5.
(in thousands) Current Long-Term Total Long-term debt (a) $ 15,000 $ 281,250 $ 296,250 Interest payments on long-term debt obligations (a) 20,242 65,330 85,572 Lease liabilities (b) 5,222 15,811 21,033 Purchase commitments (c) 23,763 25,000 48,763 $ 64,227 $ 387,391 $ 451,618 (a) Refer to Item 8. Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note 5.
The change in cash was primarily due to the following: Years Ended December 31, Change (in thousands, except for percentage) 2024 2023 $ % Cash flows from continuing operations: Net cash from operating activities $ 38,795 $ 17,513 $ 21,282 121.5 % Net cash from investing activities 22,963 27,313 (4,350) (15.9 %) Net cash from financing activities (54,580) (26,653) (27,927) 104.8 % Net cash from discontinued operations — (13,675) 13,675 (100.0 %) Effect of exchange rate changes on cash (2,560) 629 (3,189) NM Net change in cash and cash equivalents $ 4,618 $ 5,127 $ (509) (9.9 %) Operating Activities Net cash in operating activities from continuing operations increased $21.3 million, due to cash collections from sales growth and the timing of working capital payments.
The change in cash was primarily due to the following: Years Ended December 31, Change (in thousands, except for percentage) 2025 2024 $ % Net cash from operating activities $ 74,673 $ 38,795 $ 35,878 92.5 % Net cash from investing activities (3,248) 22,963 (26,211) (114.1 %) Net cash from financing activities (62,140) (54,580) (7,560) 13.9 % Effect of exchange rate changes on cash 371 (2,560) 2,931 (114.5 %) Net change in cash and cash equivalents $ 9,656 $ 4,618 $ 5,038 109.1 % Operating Activities Net cash inflows from operating activities increased $35.9 million due to cash collections on net sales, lower interest payments due to favorable interest rates and reduced debt levels, and one-time charges in 2024 including the payment of certain shareholder litigation costs and expenses related to the divestiture of the Advanced Rehabilitation Business.
Income tax (benefit) expense, net Years Ended December 31, Change (in thousands, except for percentage) 2024 2023 $ % Income tax (benefit) expense, net $ (5,293) $ 85 $ (5,378) NM Effective tax rate NM - Not Meaningful 10.8 % (0.1) % 10.9 % The $5.4 million change in income taxes was due to the recognition of deferred tax benefits resulting from the impairments recorded.
Income Tax Benefit, Net Years Ended December 31, Change (in thousands, except for percentage) 2025 2024 $ % Income tax benefit, net $ (1,565) $ (5,293) $ 3,728 (70.4) % Effective tax rate 6.1 % 10.1 % (4.0 %) The effective tax rate of 6.1% for the year ended December 31, 2025 was attributable to the release of reserves for uncertain tax positions and a positive change in the valuation allowance on deferred tax assets due to the utilization of net operating loss carryforwards.
There were no significant adjustments arising from the change in estimates of variable consideration for the years ended December 31, 2024 and 2023. Accounts receivable allowances for credit losses We maintain allowances for credit losses to provide for receivables we do not expect to collect.
Accounts Receivable Allowances for Credit Losses We maintain allowances for credit losses to provide for receivables we do not expect to collect.
As a result, we consolidate the financial results of BV LLC and report a noncontrolling interest representing the 19.4% that is owned by the Continuing LLC Owner. Noncontrolling interest activity during year ended December 31, 2024 was the result of losses recorded.
We consolidate BV LLC’s financial statements as we have both a majority economic interest and sole voting control over BV LLC. The portion of BV LLC not owned by us—19.0% as of December 31, 2025—is reflected as a noncontrolling interest, representing the share of BV LLC owned by the Continuing LLC Owner.
International Net sales increased $4.0 million, or 6.4%, due to volume growth in Pain Treatments and Surgical Solutions, partially offset with a volume decline in Restorative Therapies.
Net sales decreased $4.7 million, or 0.9%, compared to the prior year. Net sales from Pain Treatments increased $13.3 million, driven by volume growth in Durolane. Net sales from Surgical Solutions increased $12.7 million due to volume growth in BGS and Ultrasonics.
Gross profit increased $54.6 million, or 18.5%, primarily due to volume growth in Pain Treatments, Surgical Solutions and our EXOGEN Bone Stimulation System, partially offset by the Wound Business divestiture. Gross margin increased due to product mix.
Gross profit increased $1.1 million, or 0.3%, compared to the prior year, primarily driven by volume growth in Durolane, BGS and our EXOGEN Bone Stimulation System. This increase was partially offset by a $21.3 million reduction resulting from the divestiture of the Advanced Rehabilitation Business. Gross margin increased 0.8% in comparison to the prior year.
We determined the fair value of intangibles of the Wound Business based on the consideration offered for the Wound Business. 76 Table of Contents Loss on disposals The loss on disposals during the year ended December 31, 2024 resulted from the sale of the Advanced Rehabilitation Business.
Loss on Disposals The loss on disposals during the years ended December 31, 2025 and 2024 related to the sale of the Advanced Rehabilitation Business.
To the extent that we are unable to make payments under the TRA for any reason, such payments generally will be deferred and will accrue interest until paid; provided, however, that nonpayment for a specified period may constitute a material breach of a material obligation under the TRA and therefore accelerate payments due under the TRA.
To the extent that we are unable to make payments under the TRA for any reason, such payments generally will be deferred and will accrue interest until paid; provided, however, that nonpayment for a specified period may constitute a material breach of a material obligation under the TRA and therefore accelerate payments due under the TRA. 80 Table of C o ntents Indebtedness The 2025 Credit Agreement contains affirmative and negative covenants applicable to senior secured credit facilities, including covenants that, among other things, limit or restrict our ability to, subject to negotiated exceptions, incur additional indebtedness, liens on our assets, engage in acquisitions or dispositions, pay dividends or make other distributions, enter into transactions with affiliated persons, make investments, change the nature of our business or organizational documents, or prepay or make modifications to other indebtedness that would adversely affect the lenders.
Noncontrolling interest Subsequent to the IPO and related transactions, we are the sole managing member of BV LLC of which we owned 80.6% and 80.0% at December 31, 2024 and 2023, respectively. We have a majority economic interest, the sole voting interest in, and control the management of BV LLC.
The effective rate was 10.1% for the year ended December 31, 2024 due to the recognition of deferred tax benefits from recorded impairments. Noncontrolling Interest Subsequent to the IPO and related transactions, we became the sole managing member of BV LLC, holding ownership interests of 81.0% and 80.6% as of December 31, 2025 and 2024, respectively.
Adjusted EBITDA increased $16.8 million, or 21.3%, due to revenue growth and increased gross profit. International Adjusted EBITDA increased $3.3 million or 32.0%, due to increased gross profit. Liquidity and Capital Resources Sources of liquidity Our principal liquidity needs have historically been for acquisitions, working capital, research and development, clinical trials, and capital expenditures.
The increase was primarily driven by lower selling, general and administrative expenses, partially offset by lower gross profit primarily resulting from the divestiture of the Advanced Rehabilitation Business. Liquidity and Capital Resources Sources of Liquidity Our principal liquidity needs have historically been for acquisitions, working capital, research and development, clinical trials, and capital expenditures.
Restructuring costs Years Ended December 31, Change (in thousands, except for percentage) 2024 2023 $ % Restructuring costs $ (52) $ 840 $ (892) (106.2 %) There were expense reversals during the year ended December 31, 2024 primarily due to employee transitions associated with prior restructuring initiatives.
Restructuring Costs Years Ended December 31, Change (in thousands, except for percentage) 2025 2024 $ % Restructuring costs NM - Not Meaningful $ 2,235 $ (52) $ 2,287 NM Restructuring costs in 2025 primarily related to severance costs associated with the elimination of several positions in order to optimize our organizational structure.
Gross margin increased due to product mix. 75 Table of Contents Selling, general and administrative expense Years Ended December 31, Change (in thousands, except for percentage) 2024 2023 $ % Selling, general and administrative expense $ 340,894 $ 303,879 $ 37,015 12.2 % Selling, general and administrative expense increased $37.0 million, or 12.2%, primarily due to increases in: (i) compensation and related costs of $24.4 million; (ii) accounting and legal costs of $10.8 million, mostly related to the settlement of shareholder litigation; and (iii) equity-based compensation of $8.2 million.
Selling, General and Administrative Expense Years Ended December 31, Change (in thousands, except for percentage) 2025 2024 $ % Selling, general and administrative expense $ 314,026 $ 343,798 $ (29,772) (8.7 %) Selling, general and administrative expenses decreased by $29.8 million, or 8.7%, primarily due to: (i) a $14.5 million decrease in compensation-related costs, partially attributable to the sale of the Advanced Rehabilitation Business; (ii) a $13.8 million reduction in shareholder litigation costs settled during 2024; and (iii) a $2.3 million decrease in administrative related expenses.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

7 edited+0 added−1 removed4 unchanged
Biggest changeWe bill most direct sales outside of the United States in local currencies. We expect that the percentage of our sales denominated in foreign currencies will increase in the foreseeable future as we continue to expand into international markets. When sales or expenses are not denominated in U.S. dollars, a fluctuation in exchange rates could affect our net income.
Biggest changeForeign Exchange Risk Management We operate in countries other than the United States and are exposed to foreign currency risks. We bill most direct sales outside of the United States in local currencies. We expect that the percentage of our sales denominated in foreign currencies will increase in the foreseeable future as we continue to expand into international markets.
We are also exposed to interest rate risk in connection with borrowings under our Amended 2019 Credit Agreement, which bear interest at a floating rate based on three-month SOFR plus an applicable borrowing margin.
We are also exposed to interest rate risk in connection with borrowings under our 2025 Credit Agreement, which bear interest at a floating rate based on three-month SOFR plus an applicable borrowing margin.
Changes in the fair values of derivative instruments are recognized in the consolidated statements of operations and comprehensive loss in the period incurred. Interest rate risk Our cash and cash equivalents balance as of December 31, 2024 consisted of demand deposits and institutional money market funds held in U.S. and foreign banks.
Changes in the fair values of derivative instruments are recognized in the consolidated statements of operations and comprehensive income (loss) in the period incurred. 85 Table of C o ntents Interest Rate Risk Our cash and cash equivalents balance as of December 31, 2025 consisted of demand deposits and institutional money market funds held in U.S. and foreign banks.
Effects of inflation We do not believe that inflation has had a material effect on our results of operations during the periods presented herein. 84 Table of Contents
Effects of Inflation We do not believe that inflation has had a material effect on our results of operations during the periods presented herein. 86 Table of C o ntents
For variable rate debt, interest rate changes generally do not affect the fair value of the Amended 2019 Credit Agreement, but impact future earnings and cash flows, assuming other factors are constant.
For variable rate debt, interest rate changes generally do not affect the fair value of the 2025 Credit Agreement, but impact future earnings and cash flows, assuming other factors are constant. In the ordinary course of business, we may enter into contractual arrangements to reduce our exposure to interest rate risks, subject to any applicable limitations in our financing arrangements.
We believe that the risk of a significant impact on our operating income from foreign currency fluctuations is minimal.
When sales or expenses are not denominated in U.S. Dollars, a fluctuation in exchange rates could affect our net income. We believe that the risk of a significant impact on our operating income from foreign currency fluctuations is minimal.
As of December 31, 2024, a 1.0% increase in interest rate would result in $5.9 million increase in total interest payable over the remaining life of the Amended 2019 Credit Agreement in the event we were to draw down the entire capacity of our revolving credit facility.
As of December 31, 2025, a 1.0% increase in interest rate would result in a $12.0 million increase in total interest payable over the remaining life of the 2025 Term Loan, exclusive of any interest rate swap impact.
Removed
In the ordinary course of business, we may enter into contractual arrangements to reduce our exposure to interest rate risks, subject to any applicable limitations in our financing arrangements. Foreign exchange risk management We operate in countries other than the United States and are exposed to foreign currency risks.

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