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

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

+482 added−724 removedSource: 10-K (2026-03-13) vs 10-K (2025-03-11)

Top changes in ELUTIA INC.'s 2025 10-K

482 paragraphs added · 724 removed · 322 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

61 edited+78 added−184 removed55 unchanged
Biggest changeWe ship the product directly to hospitals. ​ Cardiovascular Products ​ We also sell additional cardiovascular products derived from our specialized SIS ECM, all of which received 510(k) regulatory clearance as medical devices: ​ ● ProxiCor for Cardiac Tissue Repair (“CTR”) is cleared for use as an intracardiac patch for repairs such as atrial and ventricular septal defects and suture-line buttressing, as well as for pledgets.
Biggest changeCardiovascular Market ​ Cardiovascular Products ​ We sell cardiovascular products derived from a biologic matrix based on porcine small intestinal submucosa extracellular matrix (“SIS-ECM”), all of which received 510(k) regulatory clearance as medical devices: ​ ● ProxiCor for Cardiac Tissue Repair is cleared for use as an intracardiac patch for repairs such as atrial and ventricular septal defects and suture-line buttressing, as well as for pledgets. ● ProxiCor for Pericardial Closure is used to reconstruct the pericardium after heart surgery. ● Tyke is a thinner, more pliable matrix cleared for use in neonates and infants for the repair of pericardial structures; as an epicardial covering for damaged or repaired cardiac structures, and as a patch material for cardiac defects. ● VasCure is cleared for use, and is used by cardiovascular, vascular and general surgeons as, a patch material to repair or reconstruct the peripheral vasculature, including the carotid, femoral and tibial blood vessels, by modeling into site-specific tissue and conforming to repair defects. 7 ​ Table of Contents Commercial Approach From May 2017 through March 2023, these products were sold directly to hospitals and other healthcare facilities through our sales force and independent sales agents.
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; ● labeling and promotional regulations and FDA prohibitions against the promotion of investigational products, or the promotion of “off-label” uses of cleared or approved products; ● 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 mandate manufacturers to report to the FDA if a marketed device may have caused or contributed to a death or serious injury, or if it has malfunctioned and the device or a similar one in the market could likely cause serious harm 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; ● post-market surveillance activities and regulations, which apply when deemed by the FDA to be necessary to protect the public health or to provide additional safety and effectiveness data for the device.
These include: ● establishment registration and device listing with the FDA; ● QMSR requirements, which require manufacturers, including third-party manufacturers, to follow stringent design, testing, control, documentation and other quality assurance procedures; ● labeling and promotional regulations and FDA prohibitions against the promotion of investigational products, or the promotion of “off-label” uses of cleared or approved products; ● 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 mandate manufacturers to report to the FDA if a marketed device may have caused or contributed to a death or serious injury, or if it has malfunctioned and the device or a similar one in the market could likely cause serious harm 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; ● post-market surveillance activities and regulations, which apply when deemed by the FDA to be necessary to protect the public health or to provide additional safety and effectiveness data for the device.
Medicaid programs are funded by both federal and state governments, and may vary from state to state and from year to year and will likely play an even larger role in healthcare funding pursuant to the Affordable Care Act.
Medicaid programs are funded by both federal and state governments, and may vary from state to state and from year to year and will likely play an even larger role in healthcare funding pursuant to the Affordable Care Act (“ACA”).
The PMA process, more rigorous than 510(k), requires manufacturers to demonstrate safety and efficacy with extensive pre-clinical and human clinical data, a full device description, manufacturing details, and proposed labeling. FDA has 180 days for PMA review, often extending beyond, with the possibility of convening an expert advisory panel for recommendations. A pre-approval inspection ensures compliance with the QSR.
The PMA process, more rigorous than 510(k), requires manufacturers to demonstrate safety and efficacy with extensive pre-clinical and human clinical data, a full device description, manufacturing details, and proposed labeling. FDA has 180 days for PMA review, often extending beyond, with the possibility of convening an expert advisory panel for recommendations. A pre-approval inspection ensures compliance with the QMSR.
If the CPT codes that apply to the procedures performed using our products are changed or deleted, reimbursement for performances of these procedures may be adversely affected. In the United States, some insured individuals enroll in managed care programs, which monitor and often require pre-approval of the services that a member will receive.
If the CPT codes that apply to the procedures performed using our products are changed or deleted, reimbursement for performance of these procedures may be adversely affected. In the United States, some insured individuals enroll in managed care programs, which monitor and often require pre-approval of the services that a member will receive.
Class II devices, of moderate risk, require FDA clearance through a 510(k) submission, involving compliance with general controls and potential imposition of special controls, such as performance standards and post-market surveillance. The Quality System Regulation (“QSR”) is a key aspect of general controls, ensuring adherence to quality standards in manufacturing processes.
Class II devices, of moderate risk, require FDA clearance through a 510(k) submission, involving compliance with general controls and potential imposition of special controls, such as performance standards and post-market surveillance. The Quality Management System Regulation (“QMSR”) is a key aspect of general controls, ensuring adherence to quality standards in manufacturing processes.
Success in these markets depends on product efficacy, ease of product use, product price, availability of payor coverage and adequate third-party reimbursement, customer support services for technical, clinical and reimbursement support and customer preference for, and loyalty to, the products. ​ We believe that the demonstrated clinical efficacy of our products, the breadth of our product portfolio, our in-house customer support services, our customer relationships and our reputation offer us advantages over our competitors. ​ Our products compete primarily with implantable electronic device envelopes and other cardiovascular repair and human-derived acellular dermis products.
Success in these markets depends on product efficacy, ease of product use, product price, availability of payor coverage and adequate third-party reimbursement, customer support services for technical, clinical and reimbursement support and customer preference for, and loyalty to, the products. ​ We believe that the demonstrated clinical efficacy of our products, the breadth of our product portfolio, our in-house customer support services, our customer relationships and our reputation offer us advantages over our competitors. ​ Our products compete primarily with other cardiovascular repair and human-derived acellular dermis products.
However, our owned and licensed patents could be invalidated or narrowed or otherwise fail to adequately protect our proprietary and intellectual property position and our 15 ​ Table of Contents pending owned and licensed patent applications, and any patent applications that we may in the future file or license from third parties may not result in the issuance of patents.
However, our owned and licensed patents could be invalidated or narrowed or otherwise fail to adequately protect our proprietary and intellectual property position and our pending owned and licensed patent applications, and any patent applications that we may in the future file or license from third parties may not result in the issuance of patents.
The HIPAA false statements statute prohibits, among other things, knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement or representation in connection with the delivery of, or payment for, healthcare benefits, items or services.
The HIPAA false statements statute prohibits, among other things, 14 ​ Table of Contents knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement or representation in connection with the delivery of, or payment for, healthcare benefits, items or services.
State, local, and foreign laws impact business practices in the medical device and pharmaceutical industries, including state anti-kickback and false claims laws affecting research, distribution, sales, and marketing. These laws also extend to claims involving healthcare items reimbursed by third-party payors or patients and may restrict payments to 21 ​ Table of Contents healthcare providers and referral sources.
State, local, and foreign laws impact business practices in the medical device and pharmaceutical industries, including state anti-kickback and false claims laws affecting research, distribution, sales, and marketing. These laws also extend to claims involving healthcare items reimbursed by third-party payors or patients and may restrict payments to healthcare providers and referral sources.
After a study begins, we, the FDA or the IRB could suspend or terminate a clinical study at any time for various reasons, including a belief that the risks to study subjects outweigh the anticipated benefits. Post-market Regulation After a device is cleared or approved for marketing, numerous and pervasive regulatory requirements continue to apply.
After a study begins, we, the FDA or the IRB could suspend or terminate a clinical study at any time for various reasons, including a belief that the risks to study subjects outweigh the anticipated benefits. 12 ​ Table of Contents Post-market Regulation After a device is cleared or approved for marketing, numerous and pervasive regulatory requirements continue to apply.
Third-party payors are increasingly auditing and challenging the prices charged for medical products and services with concern for upcoding, miscoding, using inappropriate modifiers, or billing for inappropriate 22 ​ Table of Contents care settings. Some third-party payors must approve coverage for new or innovative devices or procedures before they will reimburse healthcare providers who use the products or therapies.
Third-party payors are increasingly auditing and challenging the prices charged for medical products and services with concern for upcoding, miscoding, using inappropriate modifiers, or billing for inappropriate care settings. Some third-party payors must approve coverage for new or innovative devices or procedures before they will reimburse healthcare providers who use the products or therapies.
In the sale, we received approximately $14.6 million, and we may earn up to an additional $20 million, in the aggregate, in the form of earn-out payments.
We received approximately $14.6 million, and we may earn up to an additional $20.0 million, in the aggregate, in the form of earn-out payments.
The reference to our website address does not constitute incorporation by reference of the information contained on or available through our website, and you should not consider such information to be a part of this Annual Report. ​
The reference to our website address does not constitute incorporation by reference of the information contained on or available through our website, and you should not consider such information to be a part of this Annual Report. ​ 17 ​ Table of Contents
During this time, private payors have developed policies for coverage based on available data and literature. While there are certain national and regional third-party payors who cover SimpliDerm or procedures using SimpliDerm, the majority do not. ​ We are aware of several companies that compete, or are developing technologies, in our current and future product areas.
During this time, private payors have developed policies for coverage based on available data and literature. While there are certain national and regional third-party payors who provide specific reimbursement for SimpliDerm or procedures using SimpliDerm, the majority do not. ​ We are aware of several companies that are developing technologies in our current and future product areas.
On June 17, 2021, the U.S. Supreme Court dismissed a challenge asserting the ACA's unconstitutionality on procedural grounds, affirming its continuation. President Biden's executive order, preceding the Supreme Court ruling, initiated a special enrollment period for ACA marketplace health insurance coverage from February 15, 2021, through August 15, 2021, prompting a review of healthcare access policies.
Supreme Court dismissed a challenge asserting the ACA's unconstitutionality on procedural grounds, affirming its continuation. Former President Biden's executive order, preceding the Supreme Court ruling, initiated a special enrollment period for ACA marketplace health insurance coverage from February 15, 2021, through August 15, 2021, prompting a review of healthcare access policies.
The clinical investigators in the clinical study are also subject to FDA’s regulations and must obtain patient informed consent, follow 18 ​ Table of Contents the investigational plan and study protocol, and comply with all reporting and recordkeeping requirements.
The clinical investigators in the clinical study are also subject to FDA’s regulations and must obtain patient informed consent, follow the investigational plan and study protocol, and comply with all reporting and recordkeeping requirements.
To obtain 510(k) clearance, a product sponsor must submit to the FDA a premarket notification submission 17 ​ Table of Contents demonstrating that the proposed device is “substantially equivalent” to a predicate device already on the market.
To obtain 510(k) clearance, a product sponsor must submit to the FDA a premarket notification submission demonstrating that the proposed device is “substantially equivalent” to a predicate device already on the market.
Our SEC filings are available to the public over the Internet at the SEC’s website at www.sec.gov. Our SEC filings are also available free of charge under the Investor Relations section of our website at www.elutia.com as soon as reasonably practicable after they are filed with or furnished to the SEC.
Our SEC filings are also available free of charge under the Investor Relations section of our website at www.elutia.com as soon as reasonably practicable after they are filed with or furnished to the SEC.
The indemnity holdback is available as a source of recovery for Berkeley for claims of indemnification under the purchase agreement, and some or all of the holdback may be retained by Berkeley if Berkeley is successful in asserting a claim or claims for indemnification against us.
The indemnity holdback was available as a source of recovery for Berkeley for claims of indemnification under the purchase agreement, and some or 4 ​ Table of Contents all of the holdback could be retained by Berkeley if Berkeley was successful in asserting a claim or claims for indemnification against us.
If FDA and IRBs approve the IDE application, human clinical studies may commence. During a study, the sponsor is required to comply with the applicable FDA requirements, including, for example, study monitoring, selecting clinical investigators and providing them with the investigational plan, ensuring IRB review, adverse event reporting, record keeping and prohibitions on the promotion of investigational devices.
During a study, the sponsor is required to comply with the applicable FDA requirements, including, for example, study monitoring, selecting clinical investigators and providing them with the investigational plan, ensuring IRB review, adverse event reporting, record keeping and prohibitions on the promotion of investigational devices.
Additionally, uncertainties in coverage policies and periodic changes to reimbursement levels, including routine updates for procedures using our products, pose challenges. The industry must adeptly navigate these complexities to align with evolving cost control measures in healthcare. Healthcare Reform Since its enactment, the Affordable Care Act (“ACA”) has faced challenges in the judicial, executive, and Congressional arenas.
Additionally, uncertainties in coverage policies and periodic changes to reimbursement levels, including routine updates for procedures using our products, pose challenges. The industry must adeptly navigate these complexities to align with evolving cost control measures in healthcare. Healthcare Reform Since its enactment, the ACA has faced challenges in the judicial, executive, and Congressional arenas. On June 17, 2021, the U.S.
If the FDA determines that we failed to comply with applicable regulatory requirements, it can take a variety of compliance or enforcement actions, which may result in any of the following sanctions: ● warning letters, untitled letters, fines, injunctions, consent decrees and civil penalties; ● recalls, withdrawals, or administrative detention or seizure of our products; ● operating restrictions or partial suspension or total shutdown of production; ● refusing or delaying requests for 510(k) marketing clearance or PMA approvals of new products or modified products; ● withdrawing 510(k) clearances or PMA approvals that have already been granted; ● refusal to grant export approvals for our products; or ● criminal prosecution. 19 ​ Table of Contents FDA Regulation of Combination Products Certain products may be comprised of components, such as drug components and device components that would normally be regulated under different types of regulatory authorities, and frequently by different centers at the FDA.
If the FDA determines that we failed to comply with applicable regulatory requirements, it can take a variety of compliance or enforcement actions, which may result in any of the following sanctions: ● warning letters, untitled letters, fines, injunctions, consent decrees and civil penalties; ● recalls, withdrawals, or administrative detention or seizure of our products; ● operating restrictions or partial suspension or total shutdown of production; ● refusing or delaying requests for 510(k) marketing clearance or PMA approvals of new products or modified products; ● withdrawing 510(k) clearances or PMA approvals that have already been granted; ● refusal to grant export approvals for our products; or ● criminal prosecution.
We do not own or in-license any patents or patent applications covering our other products. As with other medical device and regenerative medicine companies, our ability to maintain and solidify our proprietary and intellectual property position for our product candidates will depend on our success in obtaining effective patent claims and maintaining and enforcing claims that are granted.
As with other medical device and regenerative medicine companies, our ability to maintain and solidify our proprietary and intellectual property position for our product candidates will depend on our success in obtaining effective patent claims and maintaining and enforcing claims that are granted.
The FDA’s 510(k) clearance process usually takes from three to twelve months, but often takes longer. The FDA may require additional information, including clinical data, to make a determination regarding substantial equivalence. If the FDA agrees that the device is substantially equivalent to a predicate device currently on the market, it will grant 510(k) clearance to commercially market the device.
The FDA may require additional information, including clinical data, to make a determination regarding substantial equivalence. If the FDA agrees that the device is substantially equivalent to a predicate device currently on the market, it will grant 510(k) clearance to commercially market the device.
Additionally, the purchase agreement provides for a customary indemnity holdback in 4 ​ Table of Contents the amount of $1.5 million to be retained by Berkeley for 24 months after close.
Additionally, the purchase agreement provided for a customary indemnity holdback in the amount of $1.5 million to be retained by Berkeley for 24 months after closing of the transaction.
A predicate device is a legally marketed device that is not subject to premarket approval, i.e., a device that was legally marketed prior to May 28, 1976 and for which a PMA is not required, a device that has been reclassified from Class III to Class II or I, or a device that was found substantially equivalent through the 510(k) process.
A predicate device is a legally marketed device that is not subject to premarket approval, i.e., a device that was legally marketed prior to May 28, 1976 and for which a PMA is not required, a device that has been reclassified from Class III to Class II or I, or a device that was found substantially equivalent through the 510(k) process. 11 ​ Table of Contents The FDA’s 510(k) clearance process usually takes from three to twelve months, but may take longer.
In the purchase agreement, the Company has retained the liabilities arising out of the VBM and FiberCel matters, as described in Note 17, both of which products were part of the Orthobiologics Business.
In the purchase agreement, we have retained the liabilities arising out of the VBM and FiberCel recall matters, as described in Note 17 to the consolidated financial statements, both of which products were part of the Orthobiologics Business.
Sales generated in the United States represented greater than 96% of our net sales in 2024.
All of our sales in 2025, and greater than 96% of our net sales in 2024, were generated in the United States.
“Risk Factors - Risks Related to Our Business - We face significant and continuing competition from other companies, some of which have longer operating histories, more established products and/or greater resources than we do, which could adversely affect our business, financial condition and results of operations.” ​ Sales and Marketing We have dedicated substantial resources to establishing a multi-faceted sales and marketing organization in the United States.
“Risk Factors - Risks Related to Our Business - We face significant and continuing competition from other companies, some of which have longer operating histories, more established products and/or greater resources than we do, which could adversely affect our business, financial condition and results of operations.” ​ ​ Sales and Marketing Both SimpliDerm and our Cardiovascular products are sold through independent sales agents.
In our experience, third-party payors typically reimburse for surgical procedures involving our products when patients meet established medical necessity criteria. A trend towards managed care systems has been observed among certain payors, where healthcare cost control involves restricting authorizations for surgical procedures, including those utilizing our devices.
A trend towards managed care systems has been observed among certain payors, where healthcare cost control involves restricting authorizations for surgical procedures, including those utilizing our devices.
We believe our employee relations are good. 23 ​ Table of Contents Recruiting and Retention We believe that we have been successful in attracting and retaining qualified personnel with the appropriate background and skills to support our business and its growth.
Human Capital As of December 31, 2025, we had 26 employees, and 25 employees were employed full-time. We believe our employee relations are good. Recruiting and Retention We believe that we have been successful in attracting and retaining qualified personnel with the appropriate background and skills to support our business and its growth.
We have recruited and retained staff with significant experience and skills, gained through both industry experience and training at leading colleges and 14 ​ Table of Contents universities.
We have recruited and retained staff with significant experience and skills, gained through both industry experience and academic training.
In April 2023, we entered into an agreement with LeMaitre Vascular granting them the exclusive U.S. distribution rights for our cardiovascular products.
In April 2023, we entered into an exclusive distribution agreement with LeMaitre Vascular for these products in the United States.
The determination of lead center is based on the “primary mode of action” of the combination product. The FDA has also established an Office of Combination Products to address issues surrounding combination products.
The designation of a lead center generally eliminates the need to receive approvals from more than one FDA center for combination products. 13 ​ Table of Contents The determination of lead center is based on the “primary mode of action” of the combination product. The FDA has also established an Office of Combination Products to address issues surrounding combination products.
Our executive management team has extensive experience in the regenerative medicine and medical device industries, spanning R&D, 5 ​ Table of Contents operations, manufacturing and commercial. This experience allows us to operate with a deep understanding of the underlying trends in this industry and the intertwined scientific, clinical, regulatory, commercial and manufacturing functions that drive success.
This experience allows us to operate with a deep understanding of the underlying trends in this industry and the intertwined scientific, clinical, regulatory, commercial and manufacturing functions that drive success.
The Cook License Agreement continues in effect until the date of expiration of the last to expire of the licensed patents, including any renewals or extensions. The expiration date for the last to expire of the licensed patents is currently expected to be 2031 (excluding any patent term adjustments or extensions).
The license agreement remains in effect until the earlier of the termination of the supply agreement or the expiration of the last licensed patent, which is currently expected to occur in 2031, excluding any patent term adjustments or extensions.
These products are known as combination products. Under the FDCA and its implementing regulations, the FDA is charged with assigning a center with primary jurisdiction, or a lead center, for review of a combination product. The designation of a lead center generally eliminates the need to receive approvals from more than one FDA center for combination products.
Under the FDCA and its implementing regulations, the FDA is charged with assigning a center with primary jurisdiction, or a lead center, for review of a combination product.
The life of a patent, and the protection it affords, is therefore limited and once the patent lives of our issued patents have expired, we may face competition, including from other competing technologies.
The life of a patent, and the protection it affords, is therefore limited and once the patent lives of our issued patents have expired, we may face competition, including from other competing technologies. As a result, our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours.
Failure by physicians, hospitals, ambulatory surgery centers and other users of our products to obtain sufficient coverage and reimbursement from third-party payors for procedures in which our products are used, or adverse changes in government and private third-party payors’ coverage and reimbursement policies.
Failure by physicians, hospitals, ambulatory surgery centers and other users of our products to obtain sufficient coverage and reimbursement from third-party payors for procedures in which our products are used, or adverse changes in government and private third-party payors’ coverage and reimbursement policies, could have a material adverse effect on our business, financial condition and results of operations. 15 ​ Table of Contents In our experience, third-party payors typically reimburse for surgical procedures involving our products when patients meet established medical necessity criteria.
The impact of other healthcare reform measures under the Biden administration on our business remains uncertain. Legislative changes, including aggregate reductions in Medicare payments to providers, have occurred since the ACA's inception. Notably, heightened governmental scrutiny on product pricing has led to Congressional inquiries and legislation, emphasizing transparency, pricing relationships, and reforming reimbursement methodologies.
The impact of other healthcare reform measures on our business remains uncertain. Legislative changes, including aggregate reductions in Medicare payments to providers, have occurred since the ACA's inception.
We do not intend to apply for the UKCA for our Cardiovascular and Device Protection products in the near future. ​ Regulations Governing Fraud and Abuse Within the United States, our products and our customers are subject to extensive regulation by a wide range of federal and state agencies that govern business practices in the medical device and healthcare industry.
HCT/Ps failing to meet Section 361 criteria are regulated under Section 351 of the PHSA, requiring FDA premarket review and approval. ​ Regulations Governing Fraud and Abuse Within the United States, our products and our customers are subject to extensive regulation by a wide range of federal and state agencies that govern business practices in the medical device and healthcare industry.
We believe that the Device Protection, Women’s Health and Cardiovascular markets, which we believe currently represent a combined market opportunity of greater than $1 billion in the United States, will continue to experience significant growth, given advancements in implantable medical device technologies and surgical techniques; shifting global demographics that include an aging population with a greater incidence of comorbidities, and increasing procedure volumes.
We also believe that the overall markets to which our DEB products can be applied will continue to experience significant growth given (i) advancements in implantable medical device technologies and surgical techniques, (ii) shifting demographics that include an aging population with a greater incidence of comorbidities, and (iii) increasing procedure volumes. 5 ​ Table of Contents ​ Integrated Operating Model.
The IDE becomes effective 30 days after FDA receipt unless modifications are required. Regardless of the device's risk level, clinical studies require approval and oversight from an Institutional Review Board (“IRB”) at each site. The IRB conducts initial and ongoing reviews of the IDE, setting additional study requirements.
An IDE application must be supported by relevant data, such as animal and laboratory test results, demonstrating safety for human testing and a scientifically sound protocol. The IDE becomes effective 30 days after FDA receipt unless modifications are required. Regardless of the device's risk level, clinical studies require approval and oversight from an Institutional Review Board (“IRB”) at each site.
Excluding any patent term extension, our issued patents relating to our technology for EluPro and CanGaroo are anticipated to expire starting in 2027, and our issued patent that relates to our technology for SimpliDerm is anticipated to expire in 2033. There can be no assurance that any pending patent applications will ultimately be issued as patents.
In addition, we own one U.S. patent that relates to our technology for SimpliDerm that claims a method of preparing an acellular dermal matrix that is anticipated to expire in 2033. There can be no assurance that any pending patent applications will ultimately be issued as patents.
We intend to leverage our DEB platform technology by developing and commercializing products for markets with similar unmet needs, including breast reconstruction and neurostimulation.
We are pioneering DEBs to help solve problems unaddressed by available options. We intend to leverage our DEB platform technology, and our demonstrated success related to these products, by developing and commercializing products for markets with similar unmet needs, including breast reconstruction. We intend to prioritize investment in the development of our DEB platform and pipeline programs.
SimpliDerm competes primarily against human-derived acellular dermis matrix meshes, including AbbVie’s AlloDerm, MTF’s FlexHD, Stryker’s 13 ​ Table of Contents DermACELL and Evergen’s (formerly RTI Surgical) Cortiva.
ProxiCor, Tyke and VasCure compete with bovine pericardium and synthetic patch materials produced by numerous companies, including Gore’s Gore-tex and Terumo’s Vascutek. SimpliDerm competes primarily against human-derived acellular dermis matrix meshes, including AbbVie’s AlloDerm, MTF’s FlexHD, Stryker’s DermACELL and Evergen’s (formerly RTI Surgical) Cortiva.
Should we receive incremental proceeds in the future through an earn-out payment or payment of the holdback amount, an additional gain will be recorded upon the receipt of such amounts. ​ Our Competitive Strengths Our mission is to provide advanced regenerative care products that improve the outcomes in patients primarily undergoing implantable device-related surgery.
Should we receive incremental proceeds in the future through an earn-out payment, an additional gain will be recorded upon the receipt of such amounts. ​ Our Competitive Strengths Our mission is to humanize medicine so patients can thrive without compromise. We intend to establish our DEB products as the standard of care in reconstructive procedures, including surgeries involving implanted devices.
Intellectual Property We rely on a combination of patents, trademarks, confidentiality agreements and security procedures to protect our proprietary products, preservation technology, trade secrets and know-how. We believe that our patents, trade secrets, trademarks and technology licensing rights provide us with important competitive advantages. We have also obtained additional rights through license agreements for additional products and technologies.
We expect FDA clearance of NXT-41 in the second half of 2026 and anticipate FDA clearance for NXT-41x by mid-2027. ​ ​ Intellectual Property We rely on a combination of patents, license agreements, trademarks, confidentiality agreements and security procedures to protect our proprietary products, preservation technology, trade secrets and know-how.
Item 1. Business. Overview At Elutia, our mission is to humanize medicine so that patients can thrive without compromise. As a commercial-stage company, we seek to leverage our unique understanding of biologics combined with local drug delivery to improve the interaction between implanted medical devices and patients by reducing complications associated with these surgeries.
Item 1. Business. Overview At Elutia, our mission is to humanize medicine so that patients can thrive without compromise. We develop proprietary drug-eluting biomatrix products for use in surgical reconstruction and related applications. These products are designed to improve the interaction between implanted medical devices and patients.
Risk Factors - Risks Related to Our Business - Our success depends on our ability to retain and motivate key management personnel and other employees and consultants, to attract, retain and motivate additional qualified personnel and to effectively navigate changes in our senior management team. ” Compensation and Benefits We strive to offer competitive pay and benefits designed to attract and retain exceptional talent and drive company performance.
Risk Factors - Risks Related to Our Business - Our success depends on our ability to retain and motivate key management personnel and other employees and consultants, to attract, retain and motivate additional qualified personnel and to effectively navigate changes in our senior management team. ” Culture of Inclusion We are committed to fostering an equitable and inclusive workplace that is free from discrimination, harassment, bias and prejudice and where every individual feels valued and included.
Sales of our products outside of the United States ceased after May 2024 due to changes in certain international regulatory rules which required investment by us not warranted by the current level of sales in these markets. ​ Research and Development Our research and development team has extensive experience in developing regenerative medicine and DEB products and works to design products that are intended to improve patient outcomes, simplify techniques, shorten procedures, reduce hospitalization and rehabilitation times, and, as a result, reduce costs.
We anticipate utilizing this facility for the commercial production of these products, to the extent FDA marketing authorization is obtained. ​ Research and Development Our research and development team has extensive experience in developing regenerative medicine and DEB products and works to design products that are intended to improve patient outcomes, simplify techniques, shorten procedures, reduce rehospitalizations, and as a result, reduce costs.
“Risk Factors - Risks Related to Intellectual Property.” As of December 31, 2024, we had nine registered trademarks and ten pending trademark applications worldwide, including trademark registrations for “CanGaroo,” “ProxiCor,” “Tyke,” “VasCure,” “SimpliDerm,” and “SimpliDerm Ellipse,” in the United States, and for “CanGaroo” in the European Union, United Kingdom and Japan.
We also maintain trademarks associated with our commercial products. As of December 31, 2025, we had 11 registered trademarks, including trademark registrations for “ProxiCor®,” “Tyke®,” “VasCure®,” “SimpliDerm®,” and “SimpliDerm Ellipse®,” in the United States.
There can be no assurance that the obligations of our employees, consultants, independent sales agents and third parties, with whom we have entered into confidentiality agreements, will effectively prevent disclosure of our confidential information or provide meaningful protection for our confidential information if there is unauthorized use or disclosure, or that our trade secrets or proprietary information will not be independently developed by our competitors.
In addition to patents and licenses, we rely on confidentiality agreements with our employees, consultants, independent sales agents and third-party vendors to maintain the confidentiality of our trade secrets and proprietary information. Despite all of the aforementioned measures, there can be no assurance that our intellectual property rights will not be challenged, circumvented, invalidated, or independently developed by third parties.
In addition, certain foreign laws govern the privacy and security of personal data, including health-related data.
Data Privacy and Security Laws Numerous state and federal laws, including consumer protection laws and regulations, govern the collection, dissemination, use, access to, confidentiality and security of personal information, including health-related information.
States are increasingly implementing regulations controlling product pricing, while third-party payors and authorities show growing interest in reference pricing systems, discounts, and list price disclosures. Human Capital As of December 31, 2024, we had 51 employees, nearly 100% of whom were full-time employees.
Notably, heightened governmental scrutiny on product pricing has led to Congressional inquiries and legislation, emphasizing transparency, pricing relationships, and reforming reimbursement methodologies. 16 ​ Table of Contents States are increasingly implementing regulations controlling product pricing, while third-party payors and authorities show growing interest in reference pricing systems, discounts, and list price disclosures.
In addition to our internal staff, our external network of development laboratories, testing laboratories and physicians aids us in our research and development process. ​ Manufacturing and Suppliers We manufacture CanGaroo and our cardiovascular products in our Roswell, Georgia facility and use Cook Biotech Incorporated (“Cook”), now owned by Evergen, as our sole porcine tissue supplier for these products.
In addition to our internal staff, our external network of development and testing laboratories and physicians aids us in our research and development process. ​ We are now focused on advancing our proprietary DEB platform for use in surgical reconstruction and related applications.
See Part I, Item 1A. “Risk Factors - Risks Related to Intellectual Property” for additional information regarding these and other risks related to our intellectual property portfolio and their potential effect on us.
For a discussion of risks related to our intellectual property, see Part I, Item 1A.
Additionally, in March 2023, we entered into an agreement with Sientra, a medical aesthetics company uniquely focused on plastic surgery, to expand the distribution of SimpliDerm. In April 2024, such agreement was acquired by Tiger in connection with their asset acquisition of Sientra.
In March 2023, we entered into a non-exclusive distribution agreement for SimpliDerm with Sientra. In April 2024, Tiger assumed this agreement in connection with its acquisition of Sientra, and the agreement remained in effect until October 2025, at which point, it was terminated by Elutia.
As of January 2025, no biologic matrix or any other soft tissue reinforcement material, including our product, has been approved or cleared by the FDA specifically for use in breast reconstruction surgery. ​ Limitations of Existing Solutions Autologous tissue repair procedures are options for stabilizing soft tissue defects in various applications. However, these methods have limitations.
As of February 2026, no biologic matrix or other soft tissue reinforcement material has been indicated specifically for use in breast reconstruction surgery by the U.S. Food and Drug Administration. SimpliDerm SimpliDerm is an hADM marketed for use in soft tissue repair, reinforcement, and reconstruction.
With the sale of our Orthobiologics Business in November 2023 to Berkeley as described in further detail below, we no longer operate our former Richmond, California human tissue processing and distribution facility; however, we continue to have a contract manufacturing relationship with Berkeley under which we receive SimpliDerm. ​ Discontinued Operations - Sale of Orthobiologics Business On November 8, 2023, we completed the sale of substantially all of the assets relating to our former Orthobiologics Business to Berkeley.
As part of the sale of our Orthobiologics Business to Berkeley Biologics, LLC (“Berkeley”) in November 2023, our former Richmond, California facility was transferred to Berkeley, and we no longer operate that facility. ​ Discontinued Operations - Sale of CIED Businesses On September 8, 2025, we executed an Asset Purchase Agreement (the “APA”) with BSC and CPI (collectively the “CIED Buyers”).
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These complications include infection, device migration, erosion, implant rejection, non-union of implants, fibrosis and scar formation. ​ We estimate that more than 700,000 surgical procedures were performed annually in the United States involving the implantation of medical devices such as pacemakers, defibrillators, neurostimulators or tissue expanders for breast reconstruction.
Added
Our focus is on addressing unmet medical needs and reducing complications associated with surgery, including infection, migration, erosion, implant rejection, and fibrosis. Our operations span research and development through the commercial distribution of biologic matrix products used in plastic and reconstructive surgery. ​ We have applied these capabilities to develop and commercialize products for specific surgical applications.
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This number has been driven by advances in medical device technologies, reimbursement models focused on patient outcomes, and an aging population with a growing incidence of comorbidities, including diabetes, obesity and cardiovascular and peripheral vascular diseases.
Added
As more fully described below, on October 1, 2025, we divested one such product family through the sale of substantially all of the assets related to our business of developing, commercializing, manufacturing, selling and marketing our cardiac implantable electronic device (“CIED”) products, EluPro™ and CanGaroo®, to Boston Scientific Corporation (“BSC”) and Cardiac Pacemakers Inc (“CPI”) for an aggregate purchase price of up to $88.0 million in cash.
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These comorbidities can exacerbate various immune responses and contribute to other complications upon device implant. ​ Our products are targeted to address unmet clinical needs with the goal of promoting healthy tissue formation and avoiding complications associated with medical device implants, such as scar tissue formation, capsular contraction, erosion, migration and infection.
Added
EluPro was the first antibiotic-eluting biologic matrix envelope for use with CIEDs. This transaction reflects the technical and commercial value of solutions developed using our biologic matrices and local drug delivery capabilities. ​ Following the sale of the CIED business, we are focused on advancing our drug-eluting biomatrix (“DEB”) platform.
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We currently focus on our priority markets – Device Protection and Women’s Health. ​ In Device Protection, we sell EluPro, a unique bioenvelope designed to mitigate complications associated with the implantation of electronic medical devices such as pacemakers, internal defibrillators and neurostimulation devices. Complications addressed by EluPro include infection, device migration and erosion.
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This platform builds on our biologic matrix and local drug delivery capabilities to address complications that lead to poor outcomes in reconstructive procedures and surgical repair. EluPro demonstrated the commercial potential of combining a biologic scaffold with antibiotic drug delivery to reduce device-related complications.
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The bioenvelope features a biomatrix comprised of extracellular matrix (“ECM”), which supports healthy wound healing and may facilitate re-operative procedures by reducing scar formation and fibrosis. Additionally, EluPro is embedded with the powerful antibiotics rifampin and minocycline, which are gradually released into the surrounding tissue over several weeks post-implantation 3 ​ Table of Contents to provide antimicrobial protection.
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We believe the same foundational technology can be applied to reconstructive and soft tissue repair markets where biologic matrix products are widely used, but where outcomes remain suboptimal due to complications such as infection, inflammation, and fibrosis. ​ Our lead development programs comprise NXT-41, a next-generation biologic matrix, and NXT-41x, which builds on the NXT-41 matrix by incorporating local antibiotic drug delivery.
Removed
EluPro is the only drug-eluting biomatrix (“DEB”) offering in the U.S. implantable electronic device protection market.
Added
NXT-41 is an advanced biomatrix designed to provide consistent handling and incorporation while enabling scalable manufacturing. In NXT-41x, antibiotics are incorporated into the matrix and released locally over extended periods, offering broad-spectrum antimicrobial protection 3 ​ Table of Contents against common causes of post-surgical infection.
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Alongside EluPro, we market the CanGaroo bioenvelope, our first generation product, which uses the same biomatrix but does not contain antibiotics. ​ In Women’s Health, we have developed both patented and proprietary technologies, culminating in the creation of SimpliDerm—a novel biological matrix that leverages the inherent science of natural healing processes.
Added
See “Research and Development” below for a more detailed description of these anticipated future products in our reconstructive surgery portfolio. ​ Elutia continues to market and sell its proprietary biologic matrix products, including SimpliDerm, a human acellular dermal matrix (“hADM”) used in soft tissue reconstruction, and its cardiovascular repair portfolio, comprising ProxiCor, VasCure, and Tyke.
Removed
SimpliDerm’s design uses human-based hydrated acellular dermal matrix (“HADM”) with heightened structural integrity and superior handling capabilities, which may mitigate inflammation and enhance tissue incorporation, leading to a better healing experience as compared to other human acellular dermal matrices (“ADM”), both lyophilized and pre-hydrated.
Added
SimpliDerm is the primary commercial product in our Women’s Health segment, and the cardiovascular products reside in our Cardiovascular segment. These products establish our commercial presence in surgical repair and reconstruction and provide a revenue base that supports development of our next-generation innovation.
Removed
We believe that these acellular dermal matrices represent an ideal choice for tissue repair and reconstruction, finding applications in fields such as breast reconstruction, sports medicine, hernia repair and trauma reconstruction. ​ We also sell legacy products into the Cardiovascular market.
Added
These products are sold directly to healthcare facilities through independent sales agents. ​ In 2025, we leased approximately 26,598 square feet of production, laboratory, and administrative space in Gaithersburg, Maryland, which now serves as our headquarters and primary operations site.
Removed
In Cardiovascular, we sell our specialized porcine small intestine submucosa, which is based on the same biomatrix used in EluPro and CanGaroo, for use as an intracardiac and vascular patch as well as for pericardial reconstruction. In addition, our TYKE product is designed for use in the neonatal patient population.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThe degree of market acceptance of our products will continue to depend on a number of factors, some of which are outside of our control, including, among other things: ● the actual and perceived safety and efficacy of our products; ● the potential and perceived advantages of our products over alternative treatments; ● clinical data and the clinical indications for which our products are approved or certified; 35 ​ Table of Contents ● product labeling or product insert requirements of the FDA or other regulatory authorities, including any limitations or warnings contained in approved labeling; ● the cost of using our products relative to the use of our competitors’ products or alternative treatment modalities; ● relative convenience and ease of administration; ● the strength of marketing and distribution support; ● the timing of market introduction of competitive products; ● publicity concerning our products or competing products and treatments; ● our reputation and the reputation of our products; ● the prevalence and severity of any adverse events patients experience involving our products; ● the shelf life of our products and our ability to manage the logistics of the end-user supply chain; and ● sufficient and readily accessible third-party insurance coverage and reimbursement for procedures incorporating our products.
Biggest changeIn general, physicians may be slow to change their medical treatment practices and adopt our products for a variety of reasons, including, among others: ● their lack of experience using our products and the time that must be dedicated to learning how to use our products; ● lack of evidence supporting additional patient benefits from use of our products over conventional methods; ● pressure to contain costs; ● preference for other treatment modalities or our competitors’ products; ● perceived liability risks generally associated with the use of new products and procedures; and ● limited availability of coverage and/or reimbursement from third-party payors. ​ The degree of market acceptance of our products will continue to depend on a number of factors, some of which are outside of our control, including, among other things: ● the actual and perceived safety and efficacy of our products; ● the potential and perceived advantages of our products over alternative treatments; ● clinical data and the clinical indications for which our products are approved or certified; ● product labeling or product insert requirements of the FDA or other regulatory authorities, including any limitations or warnings contained in approved labeling; ● the cost of using our products relative to the use of our competitors’ products or alternative treatment modalities; ● relative convenience and ease of administration; ● the strength of marketing and distribution support; ● the timing of market introduction of competitive products; ● publicity concerning our products or competing products and treatments; ● our reputation and the reputation of our products; ● the prevalence and severity of any adverse events patients experience involving our products; ● the shelf life of our products and our ability to manage the logistics of the end-user supply chain; and ● sufficient and readily accessible third-party insurance coverage and reimbursement for procedures incorporating our products. ​ In addition, we believe recommendations for, and support of our products by, influential physicians are essential for market acceptance and adoption.
Additionally, we may be subject to product liability claims, proceedings and lawsuits, even if the apparent injury is due to the actions of others or the pre-existing health of the patient. For example, we rely on physicians and other healthcare providers to properly and correctly use our products.
Additionally, we may be subject to product liability claims, proceedings and lawsuits, even if the apparent injury is due to the actions of others or the pre-existing health of the patient. For example, we rely on physicians and other healthcare providers to use our products properly and correctly.
We are authorized under our certificate of incorporation to issue these shares of common stock and other securities convertible into or exercisable or exchangeable for shares of our common stock for the consideration and on the terms and conditions established by our board of directors in its sole discretion, whether in connection with acquisitions or otherwise.
We are authorized under our certificate of incorporation to issue these shares of common stock and other securities convertible into or exercisable or exchangeable for shares of our common stock for consideration and on the terms and conditions established by our board of directors in its sole discretion, whether in connection with acquisitions or otherwise.
The trading market for our Class A common stock will be influenced by the research and reports that industry or securities analysts publish about us and our business. We do not control these analysts.
The trading market for our Class A common stock will be influenced by research and reports that industry or securities analysts publish about us and our business. We do not control these analysts.
When an entity is determined to have violated the federal civil False Claims Act, the government may impose civil penalties, including treble damages, and exclude the entity from participation in Medicare, Medicaid and other federal healthcare programs; ● the federal Civil Monetary Penalties Law, which prohibits, among other things, offering or transferring remuneration to a federal healthcare beneficiary that a person knows or should know is likely to influence the beneficiary’s decision to order or receive items or services reimbursable by the government from a particular provider or supplier; ● the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), which created additional federal criminal statutes that prohibit, among other things, executing a scheme to defraud any healthcare benefit program and making false statements relating to healthcare matters; ● the federal Physician Sunshine Act, which requires certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or CHIP, to report annually to CMS, information related to payments and other transfers of value to physicians, which is defined broadly to include doctors, dentists, optometrists, podiatrists and chiropractors, certain non-physician providers such as physician assistants and nurse practitioners, and teaching hospitals, and applicable manufacturers and GPOs, to report annually ownership and investment interests held by such physicians and their immediate 54 ​ Table of Contents family members.
When an entity is determined to have violated the federal civil False Claims Act, the government may impose civil penalties, including treble damages, and exclude the entity from participation in Medicare, Medicaid and other federal healthcare programs; 40 ​ Table of Contents ● the federal Civil Monetary Penalties Law, which prohibits, among other things, offering or transferring remuneration to a federal healthcare beneficiary that a person knows or should know is likely to influence the beneficiary’s decision to order or receive items or services reimbursable by the government from a particular provider or supplier; ● the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), which created additional federal criminal statutes that prohibit, among other things, executing a scheme to defraud any healthcare benefit program and making false statements relating to healthcare matters; ● the federal Physician Sunshine Act, which requires certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or CHIP, to report annually to CMS, information related to payments and other transfers of value to physicians, which is defined broadly to include doctors, dentists, optometrists, podiatrists and chiropractors, certain non-physician providers such as physician assistants and nurse practitioners, and teaching hospitals, and applicable manufacturers and GPOs, to report annually ownership and investment interests held by such physicians and their immediate family members.
The FDA or any foreign regulatory agency or notified body can delay, limit or deny approval, certification or clearance of our product candidates or require us to conduct additional nonclinical or clinical testing or abandon a program for many reasons, including: ● the FDA or the applicable foreign regulatory agency or notified body’s disagreement with the design or implementation of our clinical studies; ● negative or ambiguous results from our clinical studies or results that may not meet the level of statistical significance required by the FDA or comparable foreign regulatory agencies; ● serious and unexpected drug or device-related side effects experienced by participants in our clinical studies or by individuals using devices similar to our products; ● our inability to demonstrate to the satisfaction of the FDA or the applicable foreign regulatory agency or notified body that our product candidates are safe and effective for their intended uses, or in the case of the 510(k) clearance process, that our product candidate is substantially equivalent to a predicate device; ● the FDA’s or the applicable foreign regulatory agency or notified body’s disagreement with the interpretation of data from pre-clinical or clinical studies; ● our inability to demonstrate the clinical and other benefits of our product candidates outweigh any safety or other perceived risks; ● the FDA’s or the applicable foreign regulatory agency or notified body’s requirement for additional pre-clinical studies or clinical studies; ● the FDA’s or the applicable foreign regulatory agency or notified body’s disagreement regarding the formulation, labeling or the specifications of our products or future product candidates; ● the FDA’s or the applicable foreign regulatory agency’s failure to approve the manufacturing processes or facilities of third-party manufacturers with which we contract; or ● the potential for approval or clearance policies or regulations of the FDA or the applicable foreign regulatory agencies or notified bodies to significantly change in a manner rendering our clinical data insufficient for approval. 50 ​ Table of Contents Of the large number of products in development, only a small percentage successfully complete the FDA or foreign regulatory approval or certification processes and are commercialized.
The FDA or any foreign regulatory agency or notified body can delay, limit or deny approval, certification or clearance of our product candidates or require us to conduct additional nonclinical or clinical testing or abandon a program for many reasons, including: ● the FDA or the applicable foreign regulatory agency or notified body’s disagreement with the design or implementation of our clinical studies; ● negative or ambiguous results from our clinical studies or results that may not meet the level of statistical significance required by the FDA or comparable foreign regulatory agencies; ● serious and unexpected drug or device-related side effects experienced by participants in our clinical studies or by individuals using devices similar to our products; ● our inability to demonstrate to the satisfaction of the FDA or the applicable foreign regulatory agency or notified body that our product candidates are safe and effective for their intended uses, or in the case of the 510(k) clearance process, that our product candidate is substantially equivalent to a predicate device; ● the FDA’s or the applicable foreign regulatory agency or notified body’s disagreement with the interpretation of data from pre-clinical or clinical studies; ● our inability to demonstrate the clinical and other benefits of our product candidates outweigh any safety or other perceived risks; ● the FDA’s or the applicable foreign regulatory agency or notified body’s requirement for additional pre-clinical studies or clinical studies; ● the FDA’s or the applicable foreign regulatory agency or notified body’s disagreement regarding the formulation, labeling or the specifications of our products or future product candidates; ● the FDA’s or the applicable foreign regulatory agency’s failure to approve the manufacturing processes or facilities of third-party manufacturers with which we contract; or ● the potential for approval or clearance policies or regulations of the FDA or the applicable foreign regulatory agencies or notified bodies to significantly change in a manner rendering our clinical data insufficient for approval. ​ Of the large number of products in development, only a small percentage successfully complete the FDA or foreign regulatory approval or certification processes and are commercialized.
Failure to comply may result in delisting of our common stock, government penalties or other materially adverse consequences. ​ As a public company, and particularly after we are no longer an emerging growth company, we incur and will continue to incur significant legal, accounting and other expenses.
Failure to comply may result in delisting of our common stock, government penalties or other materially adverse consequences. ​ As a public company, and particularly as we are no longer an emerging growth company, we incur and will continue to incur significant legal, accounting and other expenses.
We regularly conduct a variety of pre-clinical and clinical studies, comparative effectiveness studies and economic and other studies of our products in an effort to generate clinical and real-world outcomes and cost effectiveness data in order to obtain product approval and drive further penetration in the markets we serve.
We conduct a variety of pre-clinical and clinical studies, comparative effectiveness studies and economic and other studies of our products in an effort to generate clinical and real-world outcomes and cost effectiveness data in order to obtain product approval and drive further penetration in the markets we serve.
Our certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty or other wrongdoing by any of our directors, officers, employees or agents to us or our stockholders, (iii) any action asserting a claim arising pursuant to any provision of the DGCL or our certificate of incorporation or bylaws, (iv) any action to interpret, apply, enforce or determine the validity of our certificate of incorporation or bylaws or (v) any action asserting a claim governed by the internal affairs doctrine; provided that, the exclusive forum provision will not apply to suits brought to enforce any liability or duty created 72 ​ Table of Contents by the Securities Act, the Exchange Act, the rules and regulations thereunder or any other claim for which the federal courts have exclusive jurisdiction; and provided further that, if and only if the Court of Chancery of the State of Delaware dismisses any such action for lack of subject matter jurisdiction, such action may be brought in another state or federal court sitting in the State of Delaware.
Our certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty or other wrongdoing by any of our directors, officers, employees or agents to us or our stockholders, (iii) any action asserting a claim arising pursuant to any provision of the DGCL or our certificate of incorporation or bylaws, (iv) any action to interpret, apply, enforce or determine the validity of our certificate of incorporation or bylaws or (v) any action asserting a claim governed by the internal affairs doctrine; provided that, the exclusive forum provision will not apply to suits brought to enforce any liability or duty created by the Securities Act, the Exchange Act, the rules and regulations thereunder or any other claim for which the federal courts have exclusive jurisdiction; and provided further that, if and only if the Court of Chancery of the State of Delaware dismisses any such action for lack of subject matter jurisdiction, such action may be brought in another state or federal court sitting in the State of Delaware.
In addition, in regularly evaluating our financial and operating performance, we may decide to sell one or more of our product lines or another portion of our business as we did with our Orthobiologics Business.
In addition, in regularly evaluating our financial and operating performance, we may decide to sell one or more of our product lines or another portion of our business as we did with our Orthobiologics Business and our CIED Business.
Demand for our products can change, and has changed, rapidly and unexpectedly, including during the time between when raw materials are ordered from our suppliers and the finished product is offered for sale.
Demand for our products can change, and has changed rapidly and unexpectedly, including during the time when raw materials are ordered from our suppliers and the finished product is offered for sale.
As of December 31, 2024, we have recorded insurance receivables of $4.8 million on our balance sheet as a loss recovery resulting from our insurance coverage for the VBM Recall. ​ As described above, our future FiberCel Recall litigation costs and obligations are now fully our financial responsibility and are expected to have a material adverse effect on our cash flow and financial position.
As of December 31, 2025, we have recorded insurance receivables of $4.8 million on our balance sheet as a loss recovery resulting from our insurance coverage for the VBM Recall. ​ As described above, our future FiberCel Recall litigation costs and obligations are now fully our financial responsibility and are expected to have a material adverse effect on our cash flow and financial position.
Misconduct by these parties could include, but is not limited to, intentional, reckless and/or negligent failures to comply with the laws and regulations of the FDA and its foreign counterparts, including, but not limited to, those relating to the manufacture, processing, packing, holding, investigating or distributing in commerce of medical devices, biological products and/or HCT/Ps, requiring the reporting of true, complete and accurate information to such regulatory bodies (including any safety problems associated with the use of our products), and relating to the conduct of clinical studies and the protection of human research subject.
Misconduct by these parties could include, but is not limited to, intentional, reckless and/or negligent failures to comply with the laws and regulations of the FDA and its foreign counterparts, including, but not limited to, those relating to the manufacture, processing, packing, 33 ​ Table of Contents holding, investigating or distributing in commerce of medical devices, biological products and/or HCT/Ps, requiring the reporting of true, complete and accurate information to such regulatory bodies (including any safety problems associated with the use of our products), and relating to the conduct of clinical studies and the protection of human research subject.
Actions by the sales representatives and other employees of our commercial partners and independent sales agents that are beyond our control could adversely impact sales in that territory or result in harm to the reputation of the Company or our products or legal liability, any of which could have a material adverse effect on our business, financial condition and results of operations.
Actions by the sales representatives and other employees of our independent sales agents that are beyond our control could adversely impact sales in that territory or result in harm to the reputation of the Company or our products or legal liability, any of which could have a material adverse effect on our business, financial condition and results of operations.
In the sale, we received $14.6 million, and we may earn up to an additional $20 million, in the aggregate, in the form of earn-out payments.
In the sale, we received $14.6 million, and we may earn up to an additional $20.0 million, in the aggregate, in the form of earn-out payments.
We may not prevail in any lawsuits that we initiate and the damages or other remedies awarded, if we were to prevail, may not be commercially meaningful.
We may not prevail in any lawsuits that we initiate and damages or other remedies awarded, if we were to prevail, may not be commercially meaningful.
It is possible that technology relevant to our business will be independently developed by a person that is not a party to such an agreement.
It is possible that technology relevant to our business will be independently developed by a person who is not a party to such an agreement.
In addition, regardless of merit or eventual outcome, product liability claims may result in: ​ ● harm to our business reputation; ● investigations by regulators; ● significant legal costs; ● distraction of management’s attention from our primary business; ● substantial monetary awards to patients or other claimants; ● loss of revenue; ● exhaustion of any available insurance and our capital resources; and 29 ​ Table of Contents ● decreased demand for our products. ​ Our product liability insurance is subject to deductibles and coverage limitations, and we may not be able to maintain this insurance.
In addition, regardless of merit or eventual outcome, product liability claims may result in: ​ ● harm to our business reputation; ● investigations by regulators; ● significant legal costs; ● distraction of management’s attention from our primary business; ● substantial monetary awards to patients or other claimants; ● loss of revenue; ● exhaustion of any available insurance and our capital resources; and ● decreased demand for our products. ​ Our product liability insurance is subject to deductibles and coverage limitations, and we may not be able to maintain this insurance.
We rely on these licenses in order to be able to use and sell various proprietary technologies that are material to our business, as well as technologies we intend to use in our future commercial activities. For example, we expect that we will be dependent on our licensing arrangements with Cook, relating to EluPro, CanGaroo and our cardiovascular products.
We rely on these licenses in order to be able to use and sell various proprietary technologies that are material to our business, as well as technologies we intend to use in our future commercial activities. For example, we expect that we will be dependent on our licensing arrangements with Cook, relating to our Cardiovascular products.
In addition, our research and development efforts may require a substantial investment of time and resources before we are adequately able to determine the commercial viability of a new product, technology or other innovation. 32 ​ Table of Contents Even if we are successful in obtaining the required regulatory clearance, there can be no assurances that we will be able to achieve market acceptance or that we will able to realize the intended benefits from commercializing this product candidate.
In addition, our research and development efforts may require a substantial investment of time and resources before we are able to determine the commercial viability of a new product, technology or other innovation. 22 ​ Table of Contents Even if we are successful in obtaining the required regulatory clearance, there can be no assurances that we will be able to achieve market acceptance or that we will be able to realize the intended benefits from commercializing this product candidate.
We are exposed to the risk that our officers, employees, independent contractors (including contract research organizations (“CROs”)), principal investigators, consultants, commercial partners and independent sales agents may engage in fraudulent conduct or other illegal activity and/or may fail to disclose unauthorized activities to us.
We are exposed to the risk that our officers, employees, independent contractors (including contract research organizations (“CROs”)), principal investigators, consultants and independent sales agents may engage in fraudulent conduct or other illegal activity and/or may fail to disclose unauthorized activities to us.
There are risks and uncertainties associated with these efforts, particularly in instances where the markets are not fully developed or are evolving. In developing and commercializing new lines of business and new products and services, we may invest significant time and resources.
There are risks and uncertainties associated with these efforts, particularly in instances where the markets are not fully developed or are evolving. In developing and commercializing new lines of business and new products and services, we may invest a significant amount of time and resources.
Before we can market or sell a new medical device or a new use of or a claim for or significant modification to an existing medical device in the United States, we must obtain either clearance from the FDA under Section 510(k) of 49 ​ Table of Contents the Federal Food, Drug, and Cosmetic Act (the “FDCA”) or approval of an application for premarket approval, or PMA, unless an exemption applies.
Before we can market or sell a new medical device or a new use of or a claim for or significant modification to an existing medical device in the United States, we must obtain either clearance from the FDA under Section 510(k) of the Federal Food, Drug, and Cosmetic Act (the “FDCA”) or approval of an application for premarket approval, or PMA, unless an exemption applies.
We believe these provisions benefits us by providing increased consistency in the application of Delaware law by chancellors particularly experienced in resolving corporate disputes and in the application of the Securities Act by federal judges, as applicable, efficient administration of cases on a more expedited schedule relative to other forums and protection against the burdens of multi-forum litigation.
We believe these provisions benefits us by providing increased consistency in the application of Delaware law by chancellors particularly experienced in resolving corporate disputes and in the application of the Securities Act by 55 ​ Table of Contents federal judges, as applicable, efficient administration of cases on a more expedited schedule relative to other forums and protection against the burdens of multi-forum litigation.
While we may take steps to mitigate the risks associated with noncompliance by our commercial partners and independent sales agents, there remains a risk that they will not comply with regulatory requirements or our requirements and policies.
While we may take steps to mitigate the risks associated with noncompliance by our independent sales agents, there remains a risk that they will not comply with regulatory requirements or our requirements and policies.
Any breakdowns or breaches of our systems, or resulting access, disclosure, or other loss of information, could significantly disrupt our business and result in legal claims or proceedings, liability under laws that protect the privacy of personal information, and damage to our reputation, any of which could have a material and adverse effect on our business, financial condition and results of operations.
Any breakdowns or breaches of our systems, or resulting access, disclosure, or other loss of information, could significantly disrupt our business and result in legal claims or proceedings, liability under laws that protect the privacy of personal information, and damage to our 32 ​ Table of Contents reputation, any of which could have a material and adverse effect on our business, financial condition and results of operations.
Our officers, employees, independent contractors, principal investigators, consultants, commercial partners and independent sales agents may engage in misconduct or activities that are improper under other laws and regulations, which would create liability for us.
Our officers, employees, independent contractors, principal investigators, consultants and independent sales agents may engage in misconduct or activities that are improper under other laws and regulations, which would create liability for us.
If 64 ​ Table of Contents we fail to comply with our obligations under these agreements, or if we are subject to a bankruptcy proceeding, the licensor may have the right to terminate the license, in which case we would not be able to market products covered by the license, which would adversely affect our business, financial condition and results of operations.
If we fail to comply with our obligations under these agreements, or if we are subject to a bankruptcy proceeding, the licensor may have the right to terminate the license, in which case we would not be able to market products covered by the license, which would adversely affect our business, financial condition and results of operations.
Compliance with these regulatory requirements, including but not limited to the FDA’s Quality System Regulation (“QSR”), current Good Manufacturing Practices (“GMPs”) and adverse events/recall reporting requirements in the United States and other applicable regulations worldwide, is subject to continual review and is monitored rigorously through periodic inspections by the FDA.
Compliance with these regulatory requirements, including but not limited to the FDA’s Quality Management System Regulation (“QMSR”), current Good Manufacturing Practices (“GMPs”) and adverse events/recall reporting requirements in the United States and other applicable regulations worldwide, is subject to continual review and is monitored rigorously through periodic inspections by the FDA.
Further, as a strategic response to changes in the competitive environment or to changes in laws and regulations, 44 ​ Table of Contents we may from time to time make certain pricing, service or marketing decisions (e.g., reduce prices) that could have a material and adverse effect on our business, financial condition and results of operations.
Further, as a strategic response to changes in the competitive environment or to changes in laws and regulations, we may from time to time make certain pricing, service or marketing decisions (e.g., reduce prices) that could have a material and adverse effect on our business, financial condition and results of operations.
Because we have exhausted our insurance coverage for this matter, the entire contingent 28 ​ Table of Contents liability for FiberCel Recall product liability losses is our financial responsibility. The satisfaction of this obligation and the future costs incurred are expected to have a material adverse effect on our cash flow, results of operations, financial position and prospects.
Because we have exhausted our insurance coverage for this matter, the entire contingent liability for FiberCel Recall product liability losses is our financial responsibility. The satisfaction of this obligation and the future costs incurred are expected to have a material adverse effect on our cash flow, results of operations, financial position and prospects.
These changes in policy or regulations may impose additional requirements, potentially leading to delays in obtaining new clearances, increased compliance costs, or limitations on maintaining current product clearances. It's important to note that the FDA and other regulatory bodies may alter their policies, and new government regulations may emerge, further complicating the regulatory landscape.
These changes in policy or regulations may impose additional requirements, potentially leading to delays in obtaining new clearances, increased compliance costs, or limitations on maintaining current product clearances. It is important to note that the FDA and other regulatory bodies may alter their policies, and new government regulations may emerge, further complicating the regulatory landscape.
Failure to comply may result in FDA enforcement actions, including warning letters, fines, injunctions, recalls, seizures, and, in severe cases, criminal penalties. The clinical study process is lengthy and expensive with uncertain outcomes. We have limited data and experience regarding the safety and efficacy of our products.
Failure to comply may result in FDA enforcement actions, including warning letters, fines, injunctions, recalls, seizures, and, in severe cases, criminal penalties. 39 ​ Table of Contents The clinical study process is lengthy and expensive with uncertain outcomes. We have limited data and experience regarding the safety and efficacy of our products.
These applications may later result in issued patents, or the revival of previously abandoned patents, that will prevent, limit or otherwise interfere with our ability to make, use or sell our products.
These applications may later result in issued patents, or the revival of previously abandoned patents, which will prevent, limit or otherwise interfere with our ability to make, use or sell our products.
Any disruption in the operation of our facilities as a result of any of the above could impair our product development and commercialization efforts and result in lost sales, lost customers and harm to our reputation, any of which would negatively impact our growth prospects and profitability and have a material adverse effect on our business, financial condition and results of operations.
Any disruption in our facility as a result of any of the above could impair our product development and commercialization efforts and result in lost sales, lost customers and harm to our reputation, any of which would negatively impact our growth prospects and profitability and have a material adverse effect on our business, financial condition and results of operations.
Also, if serious adverse events are reported during the conduct of a study, it could affect continuation of the study, product approval, certification or clearance and product adoption. In addition, U.S. and foreign regulatory authorities routinely conduct audits of clinical studies and such 48 ​ Table of Contents audits may result in adverse regulatory actions.
Also, if serious adverse events are reported during the conduct of a study, it could affect continuation of the study, product approval, certification or clearance and product adoption. In addition, U.S. and foreign regulatory authorities routinely conduct audits of clinical studies and such audits may result in adverse regulatory actions.
Our HCT/Ps are believed to be regulated solely under Section 361, and we haven't sought 510(k) clearance, PMA approval, or BLA licensure. However, the FDA could disagree, potentially requiring us to cease marketing or recall products pending proper authorization.
Our HCT/Ps are believed to be regulated solely under Section 361, and we have not sought 510(k) clearance, PMA approval, or BLA licensure. However, the FDA could disagree, potentially requiring us to cease marketing or recall products pending proper authorization.
Any failure by 63 ​ Table of Contents us to comply with federal regulations regarding intellectual property rights that were developed through the use of U.S. government funding could have a material and adverse effect on our business, financial condition and results of operations.
Any failure by us to comply with federal regulations regarding intellectual property rights that were developed through the use of U.S. government funding could have a material and adverse effect on our business, financial condition and results of operations.
If we do not adequately educate physicians, surgeons and other healthcare professionals about our products, as well as any adverse events involving these products, our products may not gain or maintain market acceptance, which may adversely affect our business, financial condition and results of operations.
If we do not adequately educate physicians, surgeons and other 24 ​ Table of Contents healthcare professionals about our products, as well as any adverse events involving these products, our products may not gain or maintain market acceptance, which may adversely affect our business, financial condition and results of operations.
As of December 31, 2024, insurance remains available to cover the cost of the VBM liability and related defense costs. However, conversely, we have no more insurance to cover the cost of the FiberCel liability and the related defense costs as of December 31, 2024.
As of December 31, 2025, insurance remains available to cover the cost of the VBM liability and related defense costs. However, conversely, we have no more insurance to cover the cost of the FiberCel liability and the related defense costs as of December 31, 2025.
We may in the future receive letters or other threats or claims from third parties inviting us to take licenses under, or alleging that we infringe, their patents. Moreover, we may become party to future adversarial proceedings regarding our patent portfolio or the patents of third parties.
We may in the future receive letters or other threats or claims from third parties inviting us to take licenses under, or alleging that we infringe, their patents. 45 ​ Table of Contents Moreover, we may become party to future adversarial proceedings regarding our patent portfolio or the patents of third parties.
Although it is not clear what, if any, long-term impact the PTAB proceedings will have on the operation of our business, patent challenge proceedings before the PTAB since its inception in 2013 have resulted in the invalidation of many U.S. 62 ​ Table of Contents patent claims.
Although it is not clear what, if any, long-term impact the PTAB proceedings will have on the operation of our business, patent challenge proceedings before the PTAB since its inception in 2013 have resulted in the invalidation of many U.S. patent claims.
Similarly, strikes, severe weather, natural disasters, equipment malfunctions or other service interruptions affecting the delivery services we use, would impair our ability to process orders for our products on a timely basis or at all, which could have a material adverse effect on our business, financial condition and results of operations.
Similarly, strikes, severe weather, natural disasters, terrorism, civil or political unrest, equipment malfunctions or other service interruptions affecting the delivery services we use, would impair our ability to process orders for our products on a timely basis or at all, which could have a material adverse effect on our business, financial condition and results of operations.
Due to the highly competitive nature of the healthcare industry and the cost containment efforts of our customers and third-party payors, we may be unable to pass along cost increases for key supplies or raw materials through higher prices to our customers.
Due to the highly competitive nature of the healthcare industry 28 ​ Table of Contents and the cost containment efforts of our customers and third-party payors, we may be unable to pass along cost increases for key supplies or raw materials through higher prices to our customers.
We operate in highly competitive markets that are characterized by intense competition, subject to rapid change and significantly affected by new product introductions, technological advancements and other market activities of industry participants. Our competitors have historically dedicated, and will continue to dedicate, significant resources to promote their products and to develop new products that compete with ours.
We operate in highly competitive markets that are characterized by intense competition, subject to rapid change and significantly affected by new product introductions, technological advancements and other market activities of industry participants. Our competitors have historically dedicated, and will continue to dedicate, significant resources to promoting their products and to developing new products that compete with ours.
Transitioning to a new supplier could be time-consuming and expensive, may result in interruptions in our operations and product delivery, could affect the performance specifications of our products or could require that we modify the design of those systems.
Transitioning to a new supplier could be 23 ​ Table of Contents time-consuming and expensive, may result in interruptions in our operations and product delivery, could affect the performance specifications of our products or could require that we modify the design of those systems.
In addition, the third parties owning such intellectual property rights could seek either an injunction prohibiting our sales, or, with respect to our sales, an obligation on our part to pay royalties or other forms of compensation and damages.
In addition, the third 49 ​ Table of Contents parties owning such intellectual property rights could seek either an injunction prohibiting our sales, or, with respect to our sales, an obligation on our part to pay royalties or other forms of compensation and damages.
In addition, because our board of directors is responsible for appointing the members of our management team, these provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current 71 ​ Table of Contents management by making it more difficult for stockholders to replace members of our board of directors.
In addition, because our board of directors is responsible for appointing the members of our management team, these provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our board of directors.
While we currently believe we are not directly regulated under HIPAA, criminal penalties may apply if we knowingly misuse health information from a HIPAA-covered entity. Additionally, the California Consumer Privacy Act (“CCPA”), effective since January 1, 2020, grants expanded rights to California residents regarding their personal information.
While we currently believe we are not directly regulated under HIPAA, criminal penalties may apply if we knowingly misuse health information from a HIPAA-covered entity. Additionally, the California Consumer 41 ​ Table of Contents Privacy Act (“CCPA”), effective since January 1, 2020, grants expanded rights to California residents regarding their personal information.
In recent years, patent rights have been the subject of significant litigation. Changes in either the patent laws or interpretation 56 ​ Table of Contents of the patent laws in the United States and other countries may diminish the value of our owned or licensed patents or narrow the scope of our patent protection.
In recent years, patent rights have been the subject of significant litigation. Changes in either the patent laws or interpretation of the patent laws in the United States and other countries may diminish the value of our owned or licensed patents or narrow the scope of our patent protection.
The degree of future protection for our proprietary rights is uncertain, and we cannot ensure that: ● any of our patents, or any of our pending patent applications, if issued, will include claims having a scope sufficient to protect our products; ● any of our pending patent applications will issue as patents; ● we will be able to successfully commercialize our products on a substantial scale, if approved, before the relevant patents we currently have, or may have, expire; ● we were the first to conceive and reduce to practice the inventions covered by each of our patents and pending patent applications; ● we were the first to file patent applications for these inventions; ● others will not develop similar or alternative technologies that do not infringe, misappropriate or otherwise violate our owned or licensed patents and other intellectual property rights; 57 ​ Table of Contents ● any of our patents will ultimately be found to be valid and enforceable; ● ownership of our patents or patent applications will not be challenged by third parties; ● any patents issued to us will provide a basis for an exclusive market for our commercially viable products, will provide us with any competitive advantages or will not be challenged by third parties; ● our competitors will not conduct research and development activities in countries where we do not have patent rights, or in countries where research and development safe harbor laws exist, and then use the information learned from such activities to develop competitive products for sale in our major commercial markets; ● we will develop additional proprietary technologies or products that are separately patentable; or ● our commercial activities or products will not infringe, misappropriate or otherwise violate the patents and other intellectual property rights of others. ● Should any of these events occur, they could have a material and adverse effect on our business, financial condition and results of operations.
The degree of future protection for our proprietary rights is uncertain, and we cannot ensure that: ● any of our patents, or any of our pending patent applications, if issued, will include claims having a scope sufficient to protect our products; ● any of our pending patent applications will issue as patents; ● we will be able to successfully commercialize our products on a substantial scale, if approved, before the relevant patents we currently have, or may have, expire; ● we were the first to conceive and reduce to practice the inventions covered by each of our patents and pending patent applications; ● we were the first to file patent applications for these inventions; ● others will not develop similar or alternative technologies that do not infringe, misappropriate or otherwise violate our owned or licensed patents and other intellectual property rights; ● any of our patents will ultimately be found to be valid and enforceable; 43 ​ Table of Contents ● ownership of our patents or patent applications will not be challenged by third parties; ● any patents issued to us will provide a basis for an exclusive market for our commercially viable products, will provide us with any competitive advantages or will not be challenged by third parties; ● our competitors will not conduct research and development activities in countries where we do not have patent rights, or in countries where research and development safe harbor laws exist, and then use the information learned from such activities to develop competitive products for sale in our major commercial markets; ● we will develop additional proprietary technologies or products that are separately patentable; or ● our commercial activities or products will not infringe, misappropriate or otherwise violate the patents and other intellectual property rights of others. ● Should any of these events occur, they could have a material and adverse effect on our business, financial condition and results of operations. ​ We may not enter into invention assignment and confidentiality agreements with all of our employees and contractors and such agreements could be ineffective or breached.
Third-party payors also may deny reimbursement for procedures using our products if they determine that a product used in a procedure was not medically necessary, was not used in accordance with cost-effective treatment methods, as determined by the third-party payor, or was used for an unapproved use.
Third-party payors also may deny reimbursement for procedures using our products if they determine that a product used in a procedure was not medically necessary, was not 29 ​ Table of Contents used in accordance with cost-effective treatment methods, as determined by the third-party payor, or was used for an unapproved use.
Accordingly, we may not be able to utilize a material portion of our federal and state NOLs or credits. Our ability to utilize our NOLs or credits is 47 ​ Table of Contents conditioned upon our attaining profitability and generating U.S. federal and state taxable income.
Accordingly, we may not be able to utilize a material portion of our federal and state NOLs or credits. Our ability to utilize our NOLs or credits is conditioned upon our attaining profitability and generating U.S. federal and state taxable income.
This will require us to be cognizant going forward of the timing from invention to filing of a patent application and be diligent in filing patent applications, but circumstances could prevent us from promptly filing patent applications on our inventions.
This will require us to 47 ​ Table of Contents be cognizant going forward of the timing from invention to filing of a patent application and be diligent in filing patent applications, but circumstances could prevent us from promptly filing patent applications on our inventions.
In addition, once we are no longer an emerging growth company, provided we then qualify as an “accelerated filer” as defined in Rule 12b-2 under the Exchange Act, we will be required to include in the annual reports that we file with the SEC an attestation report on our internal control over financial reporting issued by our independent registered public accounting firm.
In addition, as we are no longer an emerging growth company, if we in the future qualify as an “accelerated filer” as defined in Rule 12b-2 under the Exchange Act, we will be required to include in the annual reports that we file with the SEC an attestation report on our internal control over financial reporting issued by our independent registered public accounting firm.
Quality and safety issues may occur with respect to any of our products, and our future operating results will depend on our ability to maintain an effective quality control system and effectively train and manage our workforce with 42 ​ Table of Contents respect to our quality system.
Quality and safety issues may occur with respect to any of our products, and our future operating results will depend on our ability to maintain an effective quality control system and effectively train and manage our workforce with respect to our quality system.
Failure to comply with post-marketing regulatory requirements could subject us to enforcement actions, including substantial penalties, and might require us to recall or withdraw a product from the market. The regulations to which we are subject are complex and have become more stringent over time.
Failure to comply 38 ​ Table of Contents with post-marketing regulatory requirements could subject us to enforcement actions, including substantial penalties, and might require us to recall or withdraw a product from the market. The regulations to which we are subject are complex and have become more stringent over time.
Third parties may, in the future, 59 ​ Table of Contents assert claims that we are employing their proprietary technology without authorization, including claims from competitors or from non-practicing entities that have no relevant product sales and against whom our own patent portfolio may have no deterrent effect.
Third parties may, in the future, assert claims that we are employing their proprietary technology without authorization, including claims from competitors or from non-practicing entities that have no relevant product sales and against whom our own patent portfolio may have no deterrent effect.
In the past, securities class action litigation has often been brought against a company following a decline in the market price of its securities. This risk is especially relevant for us because medical device companies have experienced significant stock price volatility in recent years.
In the past, securities class action litigation has often been brought against a company following a decline in the market price of its securities. This risk is especially relevant for us because we, along with other medical device companies, have experienced significant stock price volatility in recent years.
In addition, we do not have staff in many of the areas covered by our commercial partners and independent sales agents, which makes it particularly difficult for us to monitor their performance.
In addition, we do not have staff in many of the areas covered by our independent sales agents, which makes it particularly difficult for us to monitor their performance.
Valuation allowances have been provided for all deferred tax assets related to our federal and state NOLs. In addition, other tax attributes, such as interest carryforwards, are also subject to various limits on their use under the Code.
Valuation allowances have been provided for all deferred tax assets related to our federal and state NOLs. 34 ​ Table of Contents In addition, other tax attributes, such as interest carryforwards, are also subject to various limits on their use under the Code.
Accordingly, although we have no current commitments with respect to any acquisition or investment, we regularly review potential acquisitions of, investments in, and licenses or other commercial arrangements involving, complementary businesses, products or technologies instead of developing them ourselves.
Accordingly, although we have no current commitments with respect to any acquisition or investment, we may from time to time review potential acquisitions of investments in, and licenses or other commercial arrangements involving, complementary businesses, products or technologies instead of developing them ourselves.
Proceedings challenging our patents could result in either loss of the patent or denial of the patent application or loss or reduction in the scope of one or more of the claims of the patent or patent application. In addition, such proceedings may be costly.
Proceedings challenging our patents could result in either loss of the patent or 42 ​ Table of Contents denial of the patent application or loss or reduction in the scope of one or more of the claims of the patent or patent application. In addition, such proceedings may be costly.
If a clinical study conducted by us or a third party fails to demonstrate statistically significant results supporting performance, use benefits or compelling health or economic outcomes from using our products, physicians may elect not to use our products.
If a clinical study conducted by us or a 25 ​ Table of Contents third party fails to demonstrate statistically significant results supporting performance, use benefits or compelling health or economic outcomes from using our products, physicians may elect not to use our products.
In connection with one or more of these transactions, we may: 36 ​ Table of Contents ● issue additional equity securities that would dilute the value of your investment in us; ● use cash that we may need in the future to operate our business; ● incur debt that could have terms unfavorable to us or that we might be unable to repay; ● structure the transaction in a manner that has unfavorable tax consequences, such as a stock purchase that does not permit a step-up in the tax basis for the assets acquired; ● incur asset impairment or other acquisition-related charges, or unforeseen costs, expenditures and risks; ● be unable to realize the anticipated benefits, such as increased revenues, cost savings or synergies from additional sales of existing or newly acquired products; ● experience dis-synergies in shared functions following a divestment of any portion of our business; ● be unable to successfully integrate, operate, maintain and manage any newly acquired operations; ● divert management’s attention from the existing business to integrate, operate, maintain and manage any newly acquired operations and personnel, or to manage the complexities involved in separating divested operations, services, products and personnel; ● be unable to secure the services of key employees related to an acquisition or, in the case of a divestiture, lose one or more of our key employees; ● face increased scrutiny and review of our company and operations from government and other regulatory authorities; and ● otherwise be unable to succeed in the marketplace with the acquisition.
In connection with one or more of these transactions, we may: ​ ● issue additional equity securities that would dilute the value of your investment in us; ● use cash that we may need in the future to operate our business; ● incur debt that could have terms unfavorable to us or that we might be unable to repay; ● structure the transaction in a manner that has unfavorable tax consequences, such as a stock purchase that does not permit a step-up in the tax basis for the assets acquired; ● incur higher than expected acquisition or integration costs; ● incur asset or goodwill impairment, contingencies or other acquisition-related charges, or unforeseen costs, expenditures and risks; 35 ​ Table of Contents ● be unable to realize the anticipated benefits, such as increased revenues, cost savings or synergies from additional sales of existing or newly acquired products; ● experience dis-synergies in shared functions following a divestment of any portion of our business; ● be unable to successfully integrate, operate, maintain and manage any newly acquired operations; ● divert management’s attention from the existing business to integrate, operate, maintain and manage any newly acquired operations and personnel, or to manage the complexities involved in separating divested operations, services, products and personnel; ● be unable to secure the services of key employees related to an acquisition or, in the case of a divestiture, lose one or more of our key employees; ● face increased scrutiny and review of our company and operations from government and other regulatory authorities; and ● otherwise, be unable to succeed in the marketplace with the acquisition. ​ The occurrence of any of the above could materially and adversely affect our business, financial condition and results of operations.
Further, even where a PMA is not required, we cannot assure you that we will be able to obtain 510(k) clearances with respect to such product candidates or modifications to previously cleared products.
Further, even where a PMA is not 36 ​ Table of Contents required, we cannot assure you that we will be able to obtain 510(k) clearances with respect to such product candidates or modifications to previously cleared products.
Competitors could attempt to replicate some or all of the competitive advantages we derive from our development efforts, willfully infringe, misappropriate or otherwise violate our intellectual property rights, design around our patents or develop and obtain patent protection for more effective technologies, designs or methods. EluPro, CanGaroo and SimpliDerm are the only current products covered by issued patents.
Competitors could attempt to replicate some or all of the competitive advantages we derive from our development efforts, willfully infringe, misappropriate or otherwise violate our intellectual property rights, design around our patents or develop and obtain patent protection for more effective technologies, designs or methods. SimpliDerm is the only current product covered by issued patents.
The delisting of the Company’s common stock would have a material adverse effect on the liquidity of the common stock, and could have a material adverse effect on its price. Moreover, the threat of delisting could have similar consequences.
The delisting of the Company’s common stock would have a 52 ​ Table of Contents material adverse effect on the liquidity of the common stock, and could have a material adverse effect on its price. Moreover, the threat of delisting could have similar consequences.
If we do not obtain patent term extension in the United States under the Hatch-Waxman Amendments and in foreign countries under similar legislation, thereby potentially extending the term of marketing exclusivity for our product candidates, our business may be materially harmed. Patents have a limited lifespan.
If we do not obtain patent term extension in the United States under the Hatch-Waxman Amendments, thereby potentially extending the term of marketing exclusivity for our product candidates, our business may be materially harmed. Patents have a limited lifespan.
The FDA’s authority to require a recall for a medical device must be based on a finding that there is reasonable probability that the device could cause serious injury or death.
The FDA’s authority to require a recall for a medical device must be based on a finding that there is reasonable probability that the device could cause 37 ​ Table of Contents serious injury or death.
As a result, our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours.
As a result, our owned and licensed 48 ​ Table of Contents patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours.
Because we do not control the sales representatives and other employees of our commercial partners, we cannot guarantee that our sales processes, regulatory compliance and other priorities will be consistently communicated and executed.
Because we do not control the sales representatives and other employees of our independent sales agents, we cannot guarantee that our sales processes, regulatory compliance and other priorities will be consistently communicated and executed.
Even if we are successful in developing additional products, the success of any new product offering or enhancements to any of our existing products will depend on several factors, including our ability to: ​ ● properly identify and anticipate physician and patient needs; ● develop and introduce new products and product enhancements in a timely manner; ● distinguish our products from those of our competitors; ● develop an effective and dedicated sales and marketing team; ● enter into successful agreements with commercial partners, independent sales agents and other third parties where it is beneficial for us to do so; ● adequately protect our intellectual property, avoid infringing, misappropriating or otherwise violating the intellectual property rights of third parties and obtain and maintain necessary intellectual property licenses from third parties; ● demonstrate, if required, the safety and efficacy of new products with data from pre-clinical and clinical studies; ● obtain the necessary regulatory clearances, certifications or approvals for new products, product enhancements and expanded indications; ● maintain full compliance with FDA medical devices regulations 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; ● receive adequate coverage and reimbursement for our products; and ● otherwise compete effectively against products and enhancements developed by our competitors.
Even if we are successful in developing additional products, the success of any new product offering or enhancements to any of our existing products will depend on several factors, including our ability to: ​ ● properly identify and anticipate physician and patient needs; ● develop and introduce new products and product enhancements in a timely manner; ● distinguish our products from those of our competitors; ● develop an effective and dedicated sales and marketing team; ● enter into successful agreements with commercial partners, independent sales agents and other third parties where it is beneficial for us to do so; ● adequately protect our intellectual property, avoid infringing, misappropriating or otherwise violating the intellectual property rights of third parties and obtain and maintain necessary intellectual property licenses from third parties; ● demonstrate, if required, the safety and efficacy of new products with data from pre-clinical and clinical studies; ● obtain the necessary regulatory clearances, certifications or approvals for new products, product enhancements and expanded indications; ● maintain full compliance with FDA medical devices regulations 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; ● receive adequate coverage and reimbursement for our products; and ● otherwise compete effectively against products and enhancements developed by our competitors. ​ If we are not successful in expanding our indications and developing, acquiring and commercializing new products and product enhancements, our ability to increase our net sales may be impaired, which could have a material adverse effect on our business, financial condition and results of operations.
Any potential intellectual property litigation also could force us to do one or more of the following: · stop making, selling or using products or technologies that allegedly infringe, misappropriate or otherwise violate the asserted intellectual property; ● lose the opportunity to license our technology to others or to collect royalty payments based upon successful protection and assertion of our intellectual property rights against others; ● incur significant legal expenses; ● pay substantial damages or royalties to the party whose intellectual property rights we may be found to be infringing, misappropriating or otherwise violating; ● pay the attorney’s fees and costs of litigation to the party whose intellectual property rights we may be found to be infringing, misappropriating or otherwise violating; ● redesign those products that contain the allegedly infringing intellectual property, which could be costly, disruptive and infeasible; and ● attempt to obtain a license to the relevant intellectual property from third parties, which may not be available on reasonable terms or at all, or from third parties who may attempt to license rights that they do not have.
Any potential intellectual property litigation also could force us to do one or more of the following: ● stop making, selling or using products or technologies that allegedly infringe, misappropriate or otherwise violate the asserted intellectual property; ● lose the opportunity to license our technology to others or to collect royalty payments based upon successful protection and assertion of our intellectual property rights against others; ● incur significant legal expenses; ● pay substantial damages or royalties to the party whose intellectual property rights we may be found to be infringing, misappropriating or otherwise violating; ● pay the attorney’s fees and costs of litigation to the party whose intellectual property rights we may be found to be infringing, misappropriating or otherwise violating; ● redesign those products that contain the allegedly infringing intellectual property, which could be costly, disruptive and infeasible; and ● attempt to obtain a license to the relevant intellectual property from third parties, which may not be available on reasonable terms or at all, or from third parties who may attempt to license rights that they do not have. ​ Any litigation or claim against us, even those without merit, may cause us to incur substantial costs, and could place a significant strain on our financial resources, divert the attention of management from our core business and harm our reputation.
Regardless of any precautions we may take, our information technology (“IT”) and infrastructure, and that of our technology partners and providers, may be vulnerable to attack, damage and interruption from computer viruses and malware (e.g. ransomware), malicious code, natural disasters, terrorism, war, telecommunication and electrical failures, hacking, cyberattacks, phishing attacks and other social engineering schemes, employee theft or misuse, human error, fraud, denial or degradation of service attacks, sophisticated nation-state and nation-state-supported actors or unauthorized access or use by persons inside our organization, or persons with access to systems inside our organization.
Regardless of any precautions we may take, our IT and infrastructure, and that of our technology partners, vendors and providers, may be vulnerable to attack, damage and interruption from computer viruses and malware (e.g. ransomware), malicious code, natural disasters, terrorism, war, telecommunication and electrical failures, hacking, cyberattacks, phishing attacks and other social engineering schemes, credential theft, employee theft, misuse or other malfeasance, human error, fraud, denial or degradation of service attacks, sophisticated nation-state and nation-state-supported actors, unauthorized access or use by persons inside our organization, or persons with access to systems inside our organization or exploitation of vulnerabilities in third-party software and systems.
Additionally, as of December 31, 2024, we had total warrants outstanding of 4,486,295 to purchase our Class A common stock comprised of up to 187,969 warrants issued to the lender under the SWK Loan Facility and 4,298,326 warrants issued to investors in our September 2023 Class A common stock private placement or June 2024 Class A common stock registered direct offering.
Additionally, as of December 31, 2025, we had total warrants outstanding of 4,716,295 to purchase our Class A common stock comprised of up to 187,969 warrants issued to the lender under the SWK Loan Facility and 4,528,326 warrants issued to investors in our September 2023 Class A common stock private placement or June 2024 and February 2025 Class A common stock registered direct offerings.
In the United States, we have obtained 510(k) premarket clearance from the FDA to market products such as our EluPro, CanGaroo, VasCure, ProxiCor and Tyke products.
In the United States, we have obtained 510(k) premarket clearance from the FDA to market our VasCure, ProxiCor and Tyke products.
Because of the numerous risks and uncertainties affecting product sales and our ongoing commercialization and product development efforts, including our ability to commercialize our flagship Device Protection product, EluPro, we are unable to predict with any certainty whether we will be able to increase sales of our products or the timing or amount of ongoing expenditures we will be required to incur.
Because of the numerous risks and uncertainties affecting product sales and our ongoing commercialization and product development efforts, we are unable to predict with any certainty whether we will be able to increase sales of our products or the timing or amount of ongoing expenditures we will be required to incur.
Any future funding requirements will depend on many factors, including, among other things: ● our ability to commercialize, market and sell our newly approved EluPro antibacterial envelope device; ● continued patient, physician and market acceptance of our products; ● the scope, rate of progress and cost of our current and future pre-clinical and clinical studies; ● the cost of our research and development activities and the cost of commercializing new products or technologies; ● the cost and timing of expanding our sales and marketing capabilities; ● the cost of filing and prosecuting patent applications and maintaining, defending and enforcing our patent or other intellectual property rights; ● the cost of defending, in litigation or otherwise, any claims that we infringe, misappropriate or otherwise violate third-party patents or other intellectual property rights; ● the costs of defending against or damages payable (to the extent above the applicable insurance coverage), for example, in connection with lawsuits and claims involving the FiberCel Recall or VBM Recall; ● the cost and timing of additional regulatory approvals or certifications; ● costs associated with any product recall; ● the effect of competing technological and market developments; 30 ​ Table of Contents ● the expenses we incur in manufacturing and selling our products; ● the costs of developing and commercializing new products or technologies; ● the extent to which we acquire or invest in products, technologies and businesses, although we currently have no commitments or agreements relating to any of these types of transactions; ● the costs of operating as a public company; and ● unanticipated general, legal and administrative expenses.
Any future funding requirements will depend on many factors, including, among other things: ● the cost of our research and development activities and the cost of commercializing new products or technologies; ● our ability to commercialize, market and sell our anticipated future products; ● continued patient, physician and market acceptance of our current products; ● the scope, rate of progress and cost of our current and future pre-clinical and clinical studies; ● the cost and timing of expanding our sales and marketing capabilities; ● the cost of filing and prosecuting patent applications and maintaining, defending and enforcing our patent or other intellectual property rights; ● the cost of defending, in litigation or otherwise, any claims that we infringe, misappropriate or otherwise violate third-party patents or other intellectual property rights; ● the costs of defending against or damages payable (to the extent above the applicable insurance coverage), for example, in connection with lawsuits and claims involving the FiberCel Recall or VBM Recall; ● the cost and timing of additional regulatory approvals or certifications; ● costs associated with any product recall; ● the effect of competing technological and market developments; ● the expenses we incur in manufacturing and selling our products; ● the costs of developing and commercializing new products or technologies; ● the extent to which we acquire or invest in products, technologies and businesses, although we currently have no commitments or agreements relating to any of these types of transactions; ● the costs of operating as a public company; and ● unanticipated general, legal and administrative expenses. ​ In addition, our operating plan may change as a result of a number of factors, including those set forth above and other factors currently unknown to us, and we may need additional funds sooner than anticipated.
If we are unable to or do not realize the expected strategic, economic, or other benefits of the transaction, it could adversely affect our business and financial position. ​ Because we depend upon a limited number of third-party suppliers and manufacturers and, in certain cases, exclusive suppliers for products essential to our business, we may incur significant product development costs and experience material delivery delays if we lose any significant supplier, which could materially and adversely affect our business, financial condition and results of operations. ​ We obtain some of our raw materials from a limited group of suppliers and, for reasons of quality assurance, cost-effectiveness, availability or constraints resulting from regulatory requirements, we rely on a single supplier, Cook, to source the SIS ECM biomaterial used to manufacture EluPro, CanGaroo and our Cardiovascular products.
Because we depend upon a limited number of third-party suppliers and manufacturers and, in certain cases, exclusive suppliers for products essential to our business, we may incur significant product development costs and experience material delivery delays if we lose any significant supplier, which could materially and adversely affect our business, financial condition and results of operations. ​ We obtain some of our raw materials from a limited group of suppliers and, for reasons of quality assurance, cost-effectiveness, availability or constraints resulting from regulatory requirements, we rely on a single supplier, Cook, to source the SIS ECM biomaterial used to manufacture our Cardiovascular products.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThese partnerships enable us to leverage specialized knowledge and insights, with the goal of ensuring our cybersecurity strategies and processes remain current. The results of those findings are reported to the Audit Committee and used to help identify potentially material risks and prioritize certain security initiatives. ​ We face a number of cybersecurity risks in connection with our business.
Biggest changeThe results of those findings are reported to the Audit Committee and used to help identify potentially material risks and prioritize certain security initiatives. ​ We face a number of cybersecurity risks in connection with our business. Due to evolving cybersecurity threats, it has been and will continue to be difficult to prevent, detect, mitigate, and remediate cybersecurity incidents.
Despite ongoing efforts to continued improvement of our ability to protect against cyber incidents, we may not be able to protect all information systems, and such incidents may lead to reputational harm, revenue and client loss, legal actions, statutory penalties, among other consequences. ​ Based on the information we have as of the date of this Annual Report, we do not believe that any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, have materially affected or are reasonably likely to materially affect the Company’s business strategy, results of operations or financial position.
Despite ongoing efforts toward continued improvement of our ability to protect against cyber incidents, we may not be able to protect all information systems, and such incidents may lead to reputational harm, revenue and client loss, legal actions, and statutory penalties, among other consequences. ​ Based on the information we have as of the date of this Annual Report, we do not believe that any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, have materially affected or are reasonably likely to materially affect the Company’s business strategy, results of operations or financial position.
Key elements of that program include: ​ ● Alignment with the National Institute of Standards and Technology Cybersecurity Framework to prevent, detect and respond to cyberattacks; ● Engaging external cybersecurity experts in incident response development and management; ● An information security training program instructing company employees with access to our networks how to be aware of, and help defend against cybersecurity risks; ● Evaluating the cybersecurity risk of third party service providers ; and ● Business continuity plans and critical recovery backup systems . ​ Our cybersecurity risk management program is supervised by our Director of Information Systems, who has over 20 years of relevant experience, and whose team is responsible for leading enterprise-wide information security strategy, policy, standards, architecture, and processes, as well as managing the Company’s information security and risk management awareness program. ​ Cybersecurity Incident Response Process ​ 75 ​ Table of Contents We maintain and regularly update a cybersecurity incident response plan that outlines the steps we take to identify, investigate and take action in response to any potentially material cybersecurity incidents.
Key elements of that program include: ​ ● Alignment with the National Institute of Standards and Technology Cybersecurity Framework to prevent, detect and respond to cyberattacks; ● Engaging external cybersecurity experts in incident response development and management; ● An information security training program instructing company employees with access to our networks how to be aware of, and help defend against cybersecurity risks; ● Evaluating the cybersecurity risk of third party service providers ; and ● Business continuity plans and critical recovery backup systems . ​ Our cybersecurity risk management program is supervised by our Director of Information Systems, who has over 20 years of relevant experience, and whose team is responsible for leading enterprise-wide information security strategy, policy, standards, architecture, and processes, as well as managing the Company’s information security and risk management awareness program. ​ Cybersecurity Incident Response Process ​ We maintain and regularly update a cybersecurity incident response plan that outlines the steps we take to identify, investigate and take action in response to any potentially material cybersecurity incidents.
Periodic updates are provided to the Audit Committee on, among other things, our cybersecurity risks and threats, the status of projects to strengthen the Company’s information security systems, and the emerging threat landscape. We also engage third parties to periodically evaluate and audit aspects of our information security programs, including by conducting vulnerability assessments and penetration testing.
Periodic updates are provided to the Audit Committee on, among other things, our cybersecurity risks and threats, the status of projects to strengthen the Company’s information security systems, and the 58 ​ Table of Contents emerging threat landscape.
Due to evolving cybersecurity threats, it has been and will continue to be difficult to prevent, detect, mitigate, and remediate cybersecurity incidents. We may also rely on information technology and third-party vendors to support our operations, including to collect and store sensitive data.
We may also rely on information technology and third-party vendors to support our operations, including to collect and store sensitive data.
Added
We also engage third parties to periodically evaluate and audit aspects of our information security programs, including conducting vulnerability assessments and penetration testing. These partnerships enable us to leverage specialized knowledge and insights, with the goal of ensuring our cybersecurity strategies and processes remain current.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties. Our principal executive office at December 31, 2024 is located in Silver Spring, Maryland, where we lease approximately 5,052 square feet of office and laboratory space under a lease that expires in May 2025.
Biggest changeItem 2. Properties. Our principal executive office at December 31, 2025 is in Gaithersburg, Maryland, where we lease 26,598 square feet of office, manufacturing and laboratory space under a lease that expires in January 2036 with early termination dates in 2029 and 2033.
Removed
We also occupy approximately 12,888 square feet of manufacturing and office space in Roswell, Georgia under a lease that expires in July 2029 (with an early termination right in October 2026), and 2,391 square feet for administrative space in San Diego, California that expires in February 2026.
Added
We also lease 2,391 square feet for administrative space in San Diego, California that expires in June 2028. We believe that our facilities are sufficient to meet our current and future business needs. ​
Removed
We believe that our facilities are sufficient to meet our current needs and that suitable additional space will be available as and when needed. Additionally, in March 2025, we signed a lease for 26,598 square feet in Gaithersburg, Maryland. This new facility will become our principal executive office and be utilized for office, manufacturing and laboratory space.
Removed
We expect to occupy this new facility in the second quarter of 2025. This lease expires in January 2036 with early termination dates in 2029 and 2033. ​

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeFor information about legal proceedings in which we are involved, see Note 17 to the consolidated financial statements included elsewhere in this Annual Report. ​ Item 4. Mine Safety Disclosure. Not applicable. 76 ​ Table of Contents ​ PART II
Biggest changeFor information about legal proceedings in which we are involved, see Note 17 to the consolidated financial statements included elsewhere in this Annual Report. ​ Item 4. Mine Safety Disclosure. Not applicable. ​ PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeMarket Information Our Class A common stock is traded on The Nasdaq Capital Market under the symbol “ELUT.” Stockholders As of March 3, 2025, there were approximately 29 holders of record of our Class A common stock and two affiliated holders of record of our Class B common stock.
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our Class A common stock is traded on The Nasdaq Capital Market under the symbol “ELUT.” Stockholders As of March 4, 2026, there were approximately 27 holders of record of our Class A common stock.
This number does not include “street name” or beneficial holders, whose shares are held of record by banks, brokers, financial institutions and other nominees. Dividend Policy We have never declared or paid any cash dividends on our capital stock.
This number does not include “street name” or beneficial holders, whose shares are held of record by banks, brokers, financial institutions and other nominees. 59 ​ Table of Contents Dividend Policy We have never declared or paid any cash dividends on our capital stock.
Removed
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Item 7. Management's Discussion & Analysis

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

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Biggest changeLitigation Costs, net Litigation costs, net consist primarily of legal fees and the estimated and actual costs to resolve the outstanding FiberCel and VBM litigation cases offset by the estimated and actual amounts recoverable or recovered under insurance, indemnity and contribution agreements for such costs. 81 ​ Table of Contents Results of Operations Comparison of the Years Ended December 31, 2024 and 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ ​ ​ ​ ​ ​ 2024 ​ ​ 2023 ​ ​ Change 2023 / 2024 ​ ​ ​ ​ ​ % of Net ​ ​ ​ ​ ​ % of Net ​ ​ ​ ​ ​ ​ ​ (in thousands, except percentages) Amount ​ Sales ​ Amount ​ Sales ​ $ ​ % Net sales ​ $ 24,375 ​ 100.0 % ​ $ 24,745 ​ 100.0 % ​ $ (370) ​ (1.5) % Cost of goods sold ​ 13,668 ​ 56.1 % ​ ​ 13,692 ​ 55.3 % ​ ​ (24) ​ (0.2) % Gross profit ​ 10,707 ​ 43.9 % ​ ​ 11,053 ​ 44.7 % ​ ​ (346) ​ (3.1) % Sales and marketing ​ 12,546 ​ 51.5 % ​ ​ 13,087 ​ 52.9 % ​ ​ (541) ​ (4.1) % General and administrative ​ 18,659 ​ 76.5 % ​ ​ 14,104 ​ 57.0 % ​ ​ 4,555 ​ 32.3 % Research and development ​ 3,785 ​ 15.5 % ​ ​ 4,399 ​ 17.8 % ​ ​ (614) ​ (14.0) % Litigation costs, net ​ ​ 11,368 ​ 46.6 % ​ ​ 9,989 ​ 40.4 % ​ ​ 1,379 ​ 13.8 % Total operating expenses ​ 46,358 ​ 190.2 % ​ ​ 41,579 ​ 168.0 % ​ ​ 4,779 ​ 11.5 % Loss from continuing operations ​ (35,651) ​ (146.3) % ​ ​ (30,526) ​ (123.4) % ​ ​ (5,125) ​ (16.8) % Interest expense ​ 4,779 ​ 19.6 % ​ ​ 5,796 ​ 23.4 % ​ ​ (1,017) ​ (17.5) % Loss on revaluation of warrant liability ​ ​ 14,878 ​ 61.0 % ​ ​ 4,140 ​ 16.7 % ​ ​ 10,738 ​ 259.4 % Other (income) expense, net ​ (1,186) ​ (4.9) % ​ ​ 759 ​ 3.1 % ​ ​ (1,945) ​ NM ​ Loss before provision of income taxes ​ (54,122) ​ (222.0) % ​ ​ (41,221) ​ (166.6) % ​ ​ (12,901) ​ (31.3) % Income tax expense ​ 7 ​ 0.0 % ​ ​ 28 ​ 0.1 % ​ ​ (21) ​ (75.0) % Net loss from continuing operations ​ ​ (54,129) ​ (222.1) % ​ ​ (41,249) ​ (166.7) % ​ ​ (12,880) ​ (31.2) % Income from discontinued operations ​ ​ 180 ​ 0.7 % ​ ​ 3,593 ​ 14.5 % ​ ​ (3,413) ​ (95.0) % Net loss ​ $ (53,949) ​ (221.3) % ​ $ (37,656) ​ (152.2) % ​ $ (16,293) ​ (43.3) % NM = not meaningful Net Sales Net sales information for our products is summarized as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ​ ​ ​ ​ ​ ​ ​ ​ 2024 ​ ​ 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ % of Net ​ ​ ​ ​ ​ % of Net ​ ​ Change (in thousands, except percentages) Amount ​ Sales ​ Amount ​ Sales ​ $ ​ % Products: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Device Protection ​ $ 9,907 ​ 40.6 % ​ $ 9,401 ​ 38.0 % ​ $ 506 ​ 5.4 % Women's Health ​ 11,553 ​ 47.4 % ​ 10,304 ​ 41.6 % ​ 1,249 ​ 12.1 % Cardiovascular ​ ​ 2,915 ​ 12.0 % ​ ​ 5,040 ​ 20.4 % ​ ​ (2,125) ​ (42.2) % Total Net Sales ​ $ 24,375 ​ 100.0 % ​ $ 24,745 ​ 100.0 % ​ $ (370) ​ (1.5) % ​ Total net sales decreased $0.4 million, or 1.5%, to $24.4 million in the year ended December 31, 2024 compared to $24.7 million in the year ended December 31, 2023.
Biggest changeLitigation Costs, net Litigation costs, net consist primarily of legal fees and the estimated and actual costs to resolve the outstanding FiberCel and VBM litigation cases offset by the estimated and actual amounts recoverable or recovered under insurance, indemnity and contribution agreements for such costs. 63 ​ Table of Contents Results of Operations Comparison of the Years Ended December 31, 2025 and 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ ​ ​ ​ ​ ​ 2025 ​ ​ 2024 ​ ​ Change 2024 / 2025 ​ ​ ​ ​ ​ % of Net ​ ​ ​ ​ ​ % of Net ​ ​ ​ ​ ​ ​ ​ (in thousands, except percentages) ​ ​ ​ Amount ​ Sales ​ ​ ​ ​ Amount ​ Sales ​ ​ ​ ​ $ ​ % ​ ​ ​ Net sales ​ $ 12,293 ​ 100.0 % ​ $ 14,467 ​ 100.0 % ​ $ (2,174) ​ (15.0) % Cost of goods sold ​ 5,697 ​ 46.3 % ​ ​ 7,752 ​ 53.6 % ​ ​ (2,055) ​ (26.5) % Gross profit ​ 6,596 ​ 53.7 % ​ ​ 6,715 ​ 46.4 % ​ ​ (119) ​ (1.8) % Sales and marketing ​ 5,765 ​ 46.9 % ​ ​ 4,988 ​ 34.5 % ​ ​ 777 ​ 15.6 % General and administrative ​ 15,080 ​ 122.7 % ​ ​ 18,073 ​ 124.9 % ​ ​ (2,993) ​ (16.6) % Research and development ​ 4,163 ​ 33.9 % ​ ​ 2,998 ​ 20.7 % ​ ​ 1,165 ​ 38.9 % Litigation costs, net ​ ​ 8,499 ​ 69.1 % ​ ​ 11,368 ​ 78.6 % ​ ​ (2,869) ​ (25.2) % Total operating expenses ​ 33,507 ​ 272.6 % ​ ​ 37,427 ​ 258.7 % ​ ​ (3,920) ​ (10.5) % Loss from continuing operations ​ (26,911) ​ (218.9) % ​ ​ (30,712) ​ (212.3) % ​ ​ 3,801 ​ 12.4 % Interest (income) expense, net ​ (387) ​ (3.1) % ​ ​ 934 ​ 6.5 % ​ ​ (1,321) ​ (141.4) % (Gain) loss on revaluation of warrant liability ​ ​ (13,424) ​ (109.2) % ​ ​ 14,878 ​ 102.8 % ​ ​ (28,302) ​ NM ​ Other expense (income), net ​ 2,758 ​ 22.4 % ​ ​ (1,186) ​ (8.2) % ​ ​ 3,944 ​ NM ​ Loss from continuing operations before provision of income taxes ​ (15,858) ​ (129.0) % ​ ​ (45,338) ​ (313.4) % ​ ​ 29,480 ​ 65.0 % Income tax expense ​ 13 ​ 0.1 % ​ ​ 7 ​ 0.0 % ​ ​ 6 ​ 85.7 % Net loss from continuing operations ​ ​ (15,871) ​ (129.1) % ​ ​ (45,345) ​ (313.4) % ​ ​ 29,474 ​ 65.0 % Income (loss) from discontinued operations ​ ​ 69,251 ​ 563.3 % ​ ​ (8,604) ​ (59.5) % ​ ​ 77,855 ​ NM % Net income (loss) ​ $ 53,380 ​ 434.2 % ​ $ (53,949) ​ (372.9) % ​ $ 107,329 ​ 198.9 % NM = not meaningful Net Sales Net sales information for our products is summarized as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ​ ​ ​ ​ ​ ​ ​ ​ 2025 ​ ​ 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ % of Net ​ ​ ​ ​ ​ % of Net ​ ​ Change (in thousands, except percentages) ​ ​ ​ Amount ​ Sales ​ ​ ​ ​ Amount ​ Sales ​ ​ ​ ​ $ ​ % Products: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Women's Health ​ 9,138 ​ 74.3 % ​ 11,553 ​ 79.9 % ​ (2,415) ​ (20.9) % Cardiovascular ​ ​ 3,155 ​ 25.7 % ​ ​ 2,914 ​ 20.1 % ​ ​ 241 ​ 8.3 % Total Net Sales ​ $ 12,293 ​ 100.0 % ​ $ 14,467 ​ 100.0 % ​ $ (2,174) ​ (15.0) % ​ Total net sales decreased $2.2 million, or 15.0%, to $12.3 million in the year ended December 31, 2025 compared to $14.5 million in the year ended December 31, 2024.
Satisfaction of patient deductibles throughout the course of the year also results in increased sales later in the year, once patients have paid their annual insurance deductibles in full, which reduces their out-of-pocket costs.
Satisfaction of patient deductibles throughout the course of the year also results in increased sales later in the year, once patients have paid their annual insurance t deductibles in full, which reduces their out-of-pocket costs.
See Note 14 to the consolidated financial statements included elsewhere in this Annual Report for additional information. ​ Non-GAAP Financial Measures In this Part II. Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Annual Report, we present our gross margin, excluding intangible asset amortization.
See Note 11 to the consolidated financial statements included elsewhere in this Annual Report for additional information. ​ Non-GAAP Financial Measures In this Part II. Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Annual Report, we present our gross margin, excluding intangible asset amortization.
Each Common Warrant was exercisable until July 31, 2024, the date which was 30 trading days after the clearance by the FDA of the Company’s EluPro product, at an exercise price per share of $1.4275. All Common Warrants were exercised by such date yielding exercise proceeds of $15.7 million in 2024.
Each Common Warrant was exercisable until July 31, 2024, the date which was 30 trading days after the clearance by the FDA of EluPro, at an exercise price per share of $1.4275. All Common Warrants were exercised by such date yielding exercise proceeds of $15.7 million in 2024.
The Orthobiologics Business was comprised of assets relating to researching, developing, administering, insuring, operating, commercializing, manufacturing, selling and marketing our Orthobiologics products, and the business of contract manufacturing of particulate bone, precision milled bone, cellular bone matrix, acellular dermis, soft tissue and other products. The assets sold represent the entirety of our Orthobiologics segment.
The Orthobiologics Business was comprised of assets relating to researching, developing, administering, insuring, operating, commercializing, manufacturing, selling and marketing our Orthobiologics products, and the business of contract manufacturing of particulate bone, precision milled bone, cellular bone matrix, acellular dermis, soft tissue and other products. The assets sold represented the entirety of our Orthobiologics segment.
We recognized a gain of $6.0 million on the sale of the Orthobiologics Business in 2023 and an additional gain of $0.2 million in 2024 from an adjustment payment related to the final working capital received by Berkeley at the sale date.
We recognized a gain of $6.0 million on the sale of the Orthobiologics Business in 2023 and an additional gain of $0.2 million in the second quarter of 2024 from an adjustment payment related to the final working capital received by Berkeley at the sale date.
We periodically evaluate the period of amortization for purchased intangible assets to determine whether current circumstances warrant revised estimates of useful lives. We review our purchased intangible assets for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable.
We periodically evaluate the period of amortization for purchased intangible assets to determine whether current circumstances warrant revised estimates of 72 ​ Table of Contents useful lives. We review our purchased intangible assets for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable.
The fair value of stock options is determined on the grant date using assumptions for the estimated fair value of the underlying common stock, expected term, expected volatility, dividend yield and the risk-free interest rate. We use the simplified method for estimating the expected term used to determine the fair value of options.
The fair value of stock options is determined on the grant date using assumptions for the estimated fair value of the underlying common stock, expected term, expected volatility, dividend yield and the risk-free interest rate. We use the 73 ​ Table of Contents simplified method for estimating the expected term used to determine the fair value of options.
The first covenant, which is measured quarterly, requires us to achieve a specified Minimum Aggregate Revenue (as defined in the SWK Loan Facility) for the preceding 12-month period or, alternatively, to maintain Consolidated Unencumbered Liquid Assets (as defined in the SWK Loan Facility) greater than either (i) the outstanding principal balance of the loan, or (ii) the aggregate operating cash burn (as defined in the SWK Loan Facility) for the preceding 12-month period.
The first covenant, which was measured quarterly, required us to achieve a specified Minimum Aggregate Revenue (as defined in the SWK Loan Facility) for the preceding 12-month period or, alternatively, to maintain Consolidated Unencumbered Liquid Assets (as defined in the SWK Loan Facility) greater than either (i) the outstanding principal balance of the loan, or (ii) the aggregate operating cash burn (as defined in the SWK Loan Facility) for the preceding 12-month period.
The 2025 Prefunded Warrants have an exercise price of $0.001 per share of Class A Common Stock, are exercisable immediately and will expire when exercised in full. ​ On June 18, 2024, we sold, in a registered direct offering (“2024 Registered Offering”) an aggregate of (i) 3,175,000 shares of our Class A common stock and (ii) prefunded warrants (“2024 Prefunded Warrants”) to purchase up to an aggregate of 725,000 shares of Class A Common Stock.
The 2025 Prefunded Warrants have an exercise price of $0.001 per share of Class A Common Stock, are exercisable immediately and will expire when exercised in full. ​ 67 ​ Table of Contents On June 16, 2024, we sold, in a registered direct offering (“2024 Registered Offering”) an aggregate of (i) 3,175,000 shares of our Class A common stock and (ii) prefunded warrants (“2024 Prefunded Warrants”) to purchase up to an aggregate of 725,000 shares of Class A Common Stock.
The public offering price for each share of Class A Common 85 ​ Table of Contents Stock was $3.40, and the public offering price for each 2024 Prefunded Warrant was $3.399 , for aggregate gross proceeds of approximately $13.3 million, before deducting offering expenses.
The public offering price for each share of Class A Common Stock was $3.40, and the public offering price for each 2024 Prefunded Warrant was $3.399 , for aggregate gross proceeds of approximately $13.3 million, before deducting offering expenses.
Although we use gross margin, excluding intangible asset amortization, as described above, this metric has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information 84 ​ Table of Contents presented in accordance with GAAP.
Although we use gross margin, excluding intangible asset amortization, as described above, this metric has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP.
Our present and future funding requirements will depend on many factors, including, among other things: ​ ● the cost of fully commercializing our EluPro product; ● continued patient, physician and market acceptance of our products; ● the scope, rate of progress and cost of our current and future pre-clinical and clinical studies; ● the cost of our research and development activities and the cost and timing of commercializing new products or technologies; ● the cost and timing of expanding our sales and marketing capabilities; ● the cost of filing and prosecuting patent applications and maintaining, defending and enforcing our patent or other intellectual property rights; ● the cost of defending, in litigation or otherwise, any claims that we infringe, misappropriate or otherwise violate third-party patents or other intellectual property rights; 89 ​ Table of Contents ● the costs of defending against or the damages payable in connection with the FiberCel Litigation, associated litigation related to indemnity claims by other defendants to the FiberCel Litigation and any future litigation that we may be subject to (to the extent above the applicable insurance coverage); ● the cost and timing of additional regulatory approvals; ● costs associated with any product recall that may occur; ● the effect of competing technological and market developments; ● the expenses we incur in manufacturing and selling our products; ● the extent to which we acquire or invest in products, technologies and businesses in the future, although we may currently have no commitments or agreements relating to any of these types of transactions; ● the costs of operating as a public company; ● unanticipated general, legal and administrative expenses; and ● the effects on any of the above from any pandemic, epidemic or outbreak of infectious disease or any other public health crisis.
Our present and future funding requirements will depend on many factors, including, among other things: ​ ● the cost of our research and development activities and the cost and timing of commercializing new products or technologies; 70 ​ Table of Contents ● the costs of defending against, or the damages payable in connection with the FiberCel Litigation and VBM Litigation, associated litigation related to indemnity claims by other defendants to the FiberCel Litigation and any future litigation that we may be subject to (to the extent above the applicable insurance coverage); ● continued patient, physician and market acceptance of our products; ● the scope, rate of progress and cost of our current and future pre-clinical and clinical studies; ● the cost and timing of expanding our sales and marketing capabilities; ● the cost of filing and prosecuting patent applications and maintaining, defending and enforcing our patent or other intellectual property rights; ● the cost of defending, in litigation or otherwise, any claims that we infringe, misappropriate or otherwise violate third-party patents or other intellectual property rights; ● the cost and timing of additional regulatory approvals; ● costs associated with any product recall that may occur; ● the effect of competing technological and market developments; ● the expenses we incur in manufacturing and selling our products; ● the extent to which we acquire or invest in products, technologies and businesses in the future, although we may currently have no commitments or agreements relating to any of these types of transactions; ● the costs of operating as a public company; and ● unanticipated general, legal and administrative expenses.
Actual results and the timing of events may differ materially from those contained in these forward-looking statements due to a number of factors, including those discussed in the sections entitled “Forward-Looking Statements,” “Risk Factors Summary” and in Part I, Item 1A.
Actual results and the timing of events may differ materially from those contained in these forward-looking statements due to a number of factors, including those discussed in the sections entitled “Forward-Looking Statements,” “Risk Factors Summary” and in Part I, Item 1A. “Risk Factors” of this Annual Report.
GAAP requires that management make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities 90 ​ Table of Contents at the date of the financial statements and the amounts of revenues and expenses reported during the period.
GAAP requires that management make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the amounts of revenues and expenses reported during the period.
The indemnity holdback is available as a source of recovery for Berkeley for claims of indemnification under the purchase agreement, and some or all of the holdback may be retained by Berkeley if Berkeley is successful in asserting a claim or claims for indemnification against us.
The indemnity holdback was available as a source of recovery for Berkeley for claims of indemnification under the purchase agreement, and some or all of the holdback could be retained by Berkeley if Berkeley was successful in asserting a claim or claims for indemnification against us.
Since inception, we have financed our operations primarily through amounts borrowed under our credit facilities, proceeds from our initial public offering (“IPO”), sales of our products and more recently, the sale of our Orthobiologics Business and proceeds from a follow-on offering and private placements of our common stock and warrants.
Since inception, we have financed our operations primarily through amounts borrowed under our credit facilities, proceeds from our initial public offering (“IPO”), sales of our products and more recently, the sale of our Orthobiologics and CIED Businesses and proceeds from follow-on offerings and private placements of our common stock and warrants.
In the sale, we received $14.6 million, and we may earn up to an additional $20 million, in the aggregate, in the form of earn-out payments.
We received approximately $14.6 million, and we may earn up to an additional $20.0 million, in the aggregate, in the form of earn-out payments.
Conversely, our first quarter generally has lower sales than the preceding fourth quarter as patient deductibles are re-established with the new year, which increases their out-of-pocket costs. Liquidity and Capital Resources As of December 31, 2024, we had cash and cash equivalents of approximately $13.2 million.
Conversely, our first quarter generally has lower sales than the preceding fourth quarter as patient deductibles are re-established with the new year, which increases their out-of-pocket costs. Liquidity and Capital Resources As of December 31, 2025, we had cash and cash equivalents of approximately $36.4 million.
Inventory Valuation Inventories, consisting of purchased materials, direct labor and manufacturing overhead, are stated at the lower of cost or net realizable value, with cost determined using the average cost method. At each balance sheet date, we also evaluate inventories for excess quantities, obsolescence or shelf life expiration.
Inventory Valuation Inventories, consisting primarily of purchased materials, are stated at the lower of cost or net realizable value, with cost determined using the average cost method. At each balance sheet date, we also evaluate inventories for excess quantities, obsolescence or shelf-life expiration.
In addition, the SWK Loan Facility Agreement contains two financial covenants.
In addition, the SWK Loan Facility Agreement contained two financial covenants.
Additionally, the purchase agreement provides for a customary indemnity holdback in the amount of $1.5 million to be retained by Berkeley for 24 months after close.
Additionally, the purchase agreement provided for a customary indemnity holdback in the amount of $1.5 million to be retained by Berkeley for 24 months after closing of the transaction.
Stock-Based Compensation ​ Compensation costs associated with stock option awards, restricted stock units and other forms of equity compensation are measured at the grant-date fair value of the awards and recognized over the requisite vesting period of the awards on a straight-line basis. ​ Our policy is to grant stock options at an exercise price equal to 100% of the market value of a share of common stock at closing on the date of the grant.
As such, actual settlement amounts may differ from our estimates. and such differences may be material. ​ Stock-Based Compensation ​ Compensation costs associated with stock option awards, restricted stock units and other forms of equity compensation are measured at the grant-date fair value of the awards and recognized over the requisite vesting period of the awards on a straight-line basis. ​ Our policy is to grant stock options at an exercise price equal to 100% of the market value of a share of common stock at closing on the date of the grant.
At each reporting period, the value of the Revenue Interest Obligation is re-measured based on current estimates of the net present value of future payments, with changes to be recorded in the consolidated statements of operations.
At each reporting period, the value of the Revenue Interest Obligation is re-measured based on current estimates of the net present value of future payments, with changes to be recorded in the consolidated statements of operations. The estimation of future sales and the possible attainment of sales milestones is subject to judgment.
Interest Rates All of the SWK Loan Facility borrowings take the form of Secured Overnight Financing Rate (“SOFR”) loans and bear interest at a rate per annum equal to the sum of an applicable margin of (i) 7.75% and the “Term SOFR Rate” (based upon an interest period of 3 months), or (ii) if we have elected the PIK Interest option (as defined below), 3.75% and the “Term SOFR Rate.” We may elect a portion of the interest due, to be paid in-kind at a rate per annum of 4.5% (“PIK Interest”), and such election may be made until November 15, 2025.
The total payment by the Company to SWK in full satisfaction of the debt and termination of the credit agreement was $27.8 million. ​ Interest Rates All of the SWK Loan Facility borrowings took the form of Secured Overnight Financing Rate (“SOFR”) loans and bear interest at a rate per annum equal to the sum of an applicable margin of (i) 7.75% and the “Term SOFR Rate” (based upon an interest period of 3 months), or (ii) if we had elected the PIK Interest option (as defined below), 3.75% and the “Term SOFR Rate.” We could elect a portion of the interest due, to be paid in-kind at a rate per annum of 4.5% (“PIK Interest”), and such election could be made until November 15, 2025.
In the purchase agreement, the Company has retained the liabilities arising out of the viable bone matrix (“VBM”) and FiberCel matters, as described in Note 17, both of which products were part of the Orthobiologics Business.
In the purchase agreement, we have retained the liabilities arising out of the viable bone matrix (“VBM”) and FiberCel recall matters, as described in Note 17 to the consolidated financial statements, both of which products were part of the Orthobiologics Business.
Other (Income) Expense, net ​ Other (income) expense, net was income of approximately $1.2 million in the year ended December 31, 2024 and was primarily attributable to the $1.4 million gain on the revaluation of our Revenue Interest Obligation to Ligand.
Other Expense (Income), net ​ Other (income) expense, net was expense of $2.8 million in the year ended December 31, 2025 and was primarily attributable to the $1.3 million loss on early repayment of debt and the reversal of the $1.4 million gain on the revaluation of our Revenue Interest Obligation to Ligand.
If 91 ​ Table of Contents impairment exists, the carrying value of that asset is adjusted to its fair value. A discounted cash flow analysis is used to estimate an asset’s fair value, using assumptions that market participants would apply.
A discounted cash flow analysis is used to estimate an asset’s fair value, using assumptions that market participants would apply. If impairment exists, the carrying value of that asset is adjusted to its fair value. An impairment loss would be recorded for the excess of net carrying value over the fair value of the asset impaired.
We calculate gross margin, excluding intangible asset amortization, as gross profit, excluding amortization expense relating to intangible assets we acquired in the CorMatrix Acquisition, divided by net sales.
We calculate gross margin, excluding intangible asset amortization, as gross profit, excluding amortization expense relating to intangible assets we acquired in the CorMatrix Acquisition (net of those sold in connection with the divestiture of our CIED Business), divided by net sales.
As of December 31, 2024, we had $23.5 million of indebtedness outstanding under our SWK Loan Facility and an exit fee liability to SWK of $0.9 million, with such balances being net of $0.5 million of unamortized discount and deferred financing costs.
As of September 30, 2025, we had $26.1 million of indebtedness outstanding under our SWK Loan Facility and an exit fee liability to SWK of $1.1 million, with such balances being net of $0.4 million of unamortized discount and deferred financing costs.
Our historical cash outflows have primarily been associated with acquisitions and integration, manufacturing and administrative costs, general and marketing, research and development, clinical activity, purchase of property and equipment used in our production activities, litigation defense and settlement costs and investing in our commercial infrastructure through our direct sales force and our commercial partners in order to expand our presence and to promote awareness and adoption of our products.
Our historical cash outflows have primarily been associated with manufacturing and administrative costs, sales and marketing, research and development, clinical activity, purchase of property and equipment used in our production activities, litigation defense and settlement costs and investing in our commercial infrastructure.
As part of this acquisition, we entered into a royalty agreement with Ligand pursuant to which we assumed the Revenue Interest Obligation, with an estimated present value on the acquisition date of $27.7 million.
Revenue Interest Obligation In 2017, we completed an asset purchase agreement with CorMatrix and acquired all of the CorMatrix commercial assets and related intellectual property. As part of this acquisition, we entered into a royalty agreement with Ligand pursuant to which we assumed the Revenue Interest Obligation, with an estimated present value on the acquisition date of $27.7 million.
Gross margin was 43.9% in the year ended December 31, 2024 compared to 44.7% in the year ended December 31, 2023. Gross margin, excluding intangible asset amortization, was 57.9% in the year ended December 31, 2024 compared to 58.4% in the year ended December 31, 2023.
Gross margin was 53.7% in the year ended December 31, 2025 compared to 46.4% in the year ended December 31, 2024. Gross margin, excluding intangible asset amortization, was 62.4% in the year ended December 31, 2025 compared with 53.9% in the year ended December 31, 2024.
Operating Expenses Sales and Marketing Sales and marketing expenses decreased $0.6 million, or 4.1%, to $12.5 million in the year ended December 31, 2024 compared to $13.1 million in the year ended December 31, 2023.
Operating Expenses Sales and Marketing Sales and marketing expenses increased $0.8 million, or 15.6%, to $5.8 million in the year ended December 31, 2025 compared to $5.0 million in the year ended December 31, 2024.
Cash Flows for the Years Ended December 31, 2024 and 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, ​ 2024 2023 ​ ​ (in thousands) Net cash used in: ​ ​ Operating activities ​ $ (22,657) ​ $ (21,761) Investing activities ​ (474) ​ 14,208 Financing activities ​ 17,094 ​ 9,840 Net increase (decrease) in cash ​ $ (6,037) ​ $ 2,287 ​ Net Cash Used in Operating Activities Net cash used in operating activities for the year ended December 31 2024 was $22.7 million compared to $21.8 million for the year ended December 31, 2023.
Cash Flows for the Years Ended December 31, 2025 and 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, ​ ​ 2025 ​ ​ ​ 2024 ​ ​ (in thousands) Net cash used in: ​ ​ ​ ​ Operating activities ​ $ (44,810) ​ $ (22,657) Investing activities ​ 78,559 ​ (474) Financing activities ​ (10,638) ​ 17,094 Net increase (decrease) in cash ​ $ 23,111 ​ $ (6,037) ​ Net Cash From Operating Activities Net cash used in operating activities for the year ended December 31, 2025 was $44.8 million compared to $22.7 million for the year ended December 31, 2024.
Our Women’s Health products are sold directly to hospitals and other healthcare facilities through independent sales agents or through our distribution agreement with Tiger. Expenses In recent years, we have incurred significant costs in the operation of our business.
In April 2025, this agreement with LeMaitre Vascular terminated, and, in May 2025, we resumed selling these products directly to hospitals and other healthcare facilities through independent sales agents. ​ Expenses In recent years, we have incurred significant costs in the operation of our business.
As of December 31, 2024, we were in compliance with the financial covenants and all other covenants. ​ Funding Requirements We expect to continue to incur significant expenses and operating losses for the foreseeable future as we further commercialize EluPro and expand our product development and clinical and research activities.
We expect to continue to incur significant expenses and operating losses for the foreseeable future as we further expand our product development and clinical and research activities. In addition, we expect to continue to incur significant costs and expenses associated with operating as a public company.
The following table presents a reconciliation of our gross margin, excluding intangible asset amortization, for the years ended December 31, 2024 and 2023 to the most directly comparable GAAP financial measure, which is our GAAP gross margin (in thousands). ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ December 31, ​ ​ 2024 ​ 2023 Net sales ​ $ 24,375 ​ ​ $ 24,745 ​ Cost of goods sold ​ 13,668 ​ ​ 13,692 ​ Gross profit ​ 10,707 ​ ​ 11,053 ​ Intangible asset amortization expense ​ 3,398 ​ ​ 3,398 ​ Gross profit, excluding intangible asset amortization ​ $ 14,105 ​ ​ $ 14,451 ​ Gross margin ​ 43.9 % ​ 44.7 % Gross margin, excluding intangible asset amortization ​ 57.9 % ​ 58.4 % ​ Seasonality Historically, we have experienced seasonality in our first and fourth quarters, and we generally expect this trend to continue but may also see quarter-to-quarter fluctuations that are inconsistent with this trend.
In addition, other companies, including companies in our industry, may use other measures to evaluate their performance, which could reduce the usefulness of this non-GAAP financial measure as a tool for comparison. 66 ​ Table of Contents The following table presents a reconciliation of our gross margin, excluding intangible asset amortization, for the years ended December 31, 2025 and 2024 to the most directly comparable GAAP financial measure, which is our GAAP gross margin (in thousands). ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ December 31, ​ ​ ​ 2025 ​ ​ ​ ​ 2024 Net sales ​ $ 12,293 ​ ​ $ 14,467 ​ Cost of goods sold ​ 5,697 ​ ​ 7,752 ​ Gross profit ​ 6,596 ​ ​ 6,715 ​ Intangible asset amortization expense ​ 1,077 ​ ​ 1,077 ​ Gross profit, excluding intangible asset amortization ​ $ 7,673 ​ ​ $ 7,792 ​ Gross margin ​ 53.7 % ​ 46.4 % Gross margin, excluding intangible asset amortization ​ 62.4 % ​ 53.9 % ​ Seasonality Historically, we have experienced seasonality in our first and fourth quarters, and we generally expect this trend to continue but may also see quarter-to-quarter fluctuations that are inconsistent with this trend.
Subsequent to year-end, on February 4, 2025, we sold, in a registered direct offering (“2025 Registered Offering”) an aggregate of (i) 5,520,000 shares of our Class A common stock and (ii) prefunded warrants (“2025 Prefunded Warrants”) to purchase up to an aggregate of 480,000 shares of Class A Common Stock.
However, such transactions may not be successful, and we may not be able to raise additional equity, refinance our debt instruments, sell assets or obtain waivers or amendments to our obligations on acceptable terms, or at all. ​ On February 4, 2025, we sold, in a registered direct offering (“2025 Registered Offering”) an aggregate of (i) 5,520,000 shares of our Class A common stock and (ii) prefunded warrants (“2025 Prefunded Warrants”) to purchase up to an aggregate of 480,000 shares of Class A Common Stock.
However, such transactions may not be successful and we may not be able to raise additional equity or debt, or sell or license assets on acceptable terms, or at all. We may also consider raising additional capital in the future to expand our business, pursue strategic investments or take advantage of financing opportunities.
We may also consider raising additional capital in the future to expand our business, pursue strategic investments or take advantage of financing opportunities.
The Revenue Interest Obligation, as amended in January 2024, requires us to pay Ligand 5.0% of future sales of our CanGaroo, ProxiCor, Tyke and VasCure products, and substantially similar products, such as EluPro, through May 31, 2027, subject to annual minimum payments of $4.4 million. ​ If our available cash balances and cash flow from operations are insufficient to satisfy our liquidity requirements, we may seek to raise additional capital through equity offerings, debt financings, or asset sale or other transactions.
The Revenue Interest Obligation, as amended in January 2024, requires us to pay Ligand 5.0% of future sales of our CanGaroo, ProxiCor, Tyke and VasCure products, and substantially similar products, such as EluPro, through May 31, 2027, subject to annual minimum payments of $4.4 million. ​ Effective May 8, 2025, we entered into a subscription agreement and further amendment to the Revenue Interest Obligation with Ligand.
However, such transactions may not be successful, and we may not be able to raise additional equity, refinance our debt instruments, or sell assets on acceptable terms, or at all.
In the future, we may also seek to preserve existing capital by obtaining waivers, amendments or similar accommodations from our lender and other obligees. However, such transactions may not be successful, and we may not be able to raise additional equity or debt, sell or license assets or obtain waivers or amendments on acceptable terms, or at all.
Cost of goods sold also includes the amortization of intangibles generated from the CorMatrix Acquisition in 2017. 80 ​ Table of Contents Sales and Marketing Expenses Sales and marketing expenses are primarily related to our direct sales force, consisting of salaries, commission compensation, fringe benefits, meals and other expenses. Auto and travel costs also contribute to sales and marketing expenses.
Cost of goods sold also includes the amortization of intangibles related to the Cardiovascular products generated from the CorMatrix Acquisition in 2017. Sales and Marketing Expenses Sales and marketing expenses are primarily related to the sales commissions of our SimpliDerm and Cardiovascular independent sales agents.
Changes in assumptions or market conditions could result in a change in estimated future cash flows and could result in a lower fair value and therefore an impairment, which could impact reported results. Revenue Interest Obligation In 2017, we completed an asset purchase agreement with CorMatrix and acquired all of the CorMatrix commercial assets and related intellectual property.
The results of impairment tests are subject to management’s estimates and assumptions of projected cash flows and operating results. Changes in assumptions or market conditions could result in a change in estimated future cash flows and could result in a lower fair value and therefore an impairment, which could impact reported results.
Because of the numerous risks and uncertainties associated with our commercialization and development efforts, including our ability to successfully commercialize our new EluPro product, we are unable to predict when we will become profitable, and we may never become profitable.
We expect to incur operating losses and negative cash flows from operations for the foreseeable future as we advance our development and commercialization of NXT-41 and NXT-41x. Because of the numerous risks and uncertainties associated with our development and commercialization efforts, we are unable to predict when we will become profitable, and we may never become profitable.
The increase in expense resulted largely from the non-cash equity compensation grants made in January 2024. Research and Development R&D expenses decreased to $3.8 million in the year ended December 31, 2024 compared to $4.4 million in the year ended December 31, 2023.
Research and Development R&D expenses increased to $4.2 million in the year ended December 31, 2025 compared to $3.0 million in the year ended December 31, 2024.
Security ​ All obligations under the SWK Loan Facility are, and any future guarantees of those obligations will be, secured by, among other things, and in each case subject to certain exceptions, a first priority lien on and security interest in, upon, and to all of our assets, whether now owned or hereafter acquired, wherever located. ​ Covenants and Other Matters The SWK Loan Facility Agreement that governs the SWK Loan Facility contains a number of covenants that, among other things and subject to certain exceptions, restrict our ability to: ● incur additional indebtedness; ● incur certain liens; ● pay dividends or make other distributions on equity interests; ● redeem, repurchase or refinance subordinated indebtedness; ● consolidate, merge or sell or otherwise dispose of their assets; ● make investments, loans, advances, guarantees and acquisitions; ● enter into transactions with affiliates; ● amend or modify their governing documents; ● amend or modify certain material agreements; and ● alter the business conducted by them and their subsidiaries.
The “Term SOFR Rate” was subject to a floor of 2.75%. ​ Optional Prepayment ​ The agreement, as amended, governing the SWK Loan Facility also included an exit fee equal to 6.5% of the aggregate principal amount funded prior to termination plus $112,500. ​ Covenants and Other Matters The SWK Loan Facility Agreement that governed the SWK Loan Facility contained a number of covenants that, among other things and subject to certain exceptions, restricted our ability to: incur additional indebtedness; incur certain liens; pay dividends or make other distributions on equity interests; redeem, repurchase or refinance subordinated indebtedness; consolidate, merge or sell or otherwise dispose of assets; make investments, loans, advances, guarantees and acquisitions; enter into transactions with affiliates; amend or modify our governing documents; amend or modify certain 69 ​ Table of Contents material agreements; and alter the business conducted by us and our subsidiary.
Our Device Protection products are sold to hospitals and other healthcare facilities primarily through our direct sales force, commercial partners or independent sales agents. Our cardiovascular products are sold domestically through a distribution agreement with LeMaitre Vascular and were previously sold internationally through commercial partners.
Our Women’s Health products are sold directly to hospitals and other healthcare facilities through independent sales agents, and until its termination in October 2025, through our distribution agreement with Tiger. From April 2023 through April 2025, our Cardiovascular products were sold through a distribution agreement with LeMaitre Vascular.
Below is a breakdown of our main expense categories and the related expenses incurred in each category: Costs of Goods Sold Our cost of goods sold relate to purchased raw materials and the processing and conversion costs of such raw materials consisting primarily of salaries and benefits, supplies, quality control testing and the manufacturing overhead incurred at our processing facilities in Roswell, Georgia and our former Orthobiologics facility in Richmond, California.
Below is a breakdown of our main expense categories and the related expenses incurred in each category: Cost of Goods Sold Our cost of goods sold relate to the purchase costs of the SimpliDerm finished goods and the purchased raw materials and minor finished good conversion costs required for the Cardiovascular products.
Discontinued Operations Income from discontinued operations for the year ended December 31, 2024 was $0.2 million and the loss from discontinued operations for the year ended December 31, 2023 was $3.6 million. See Notes 1 and 4 to the consolidated financial statements included elsewhere in this Annual Report for further discussion.
See Notes 10 and 11 to the consolidated financial statements included elsewhere in this Annual Report for additional information. ​ Other (income) expense, net was income of approximately $1.2 million in the year ended December 31, 2024 and was primarily attributable to the $1.4 million gain on the revaluation of our Revenue Interest Obligation to Ligand.
Research and Development Expenses Research and development (“R&D”) expenses consist primarily of salaries and fringe benefits, laboratory supplies, clinical studies and outside service costs. Over the last several years, our product development efforts have primarily related to activities associated with the development of EluPro (referred to as CanGarooRM during development), our initial DEB product offering.
Research and Development Expenses Research and development (“R&D”) expenses consist primarily of salaries and fringe benefits, laboratory supplies, clinical studies and outside service costs.
An initial draw of $21 million was made on the Closing Date with the additional $4 million drawn on December 14, 2022. The SWK Loan Facility also allows for the establishment of a separate, new asset-based revolving loan facility of up to $8 million, which has not been entered into to date.
An initial draw of $21 million was made on the Closing Date with the additional $4 million drawn on December 14, 2022.
EluPro revenues as well as overall Device Protection revenues are expected to continue to grow as we further commercialize this product in 2025. 82 ​ Table of Contents Cost of Goods Sold Cost of goods sold and gross margin percentage information for our products is summarized as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 ​ ​ 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross ​ ​ ​ ​ ​ Gross ​ ​ Change 2023 / 2024 (in thousands, except percentages) ​ Amount ​ Margin % ​ Amount ​ Margin % ​ $ ​ % Products: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Device Protection ​ $ 3,594 ​ 63.7 % ​ $ 2,836 ​ 69.8 % ​ $ 758 ​ (6.1) % Women's Health ​ 5,568 ​ 51.8 % ​ ​ 5,902 ​ 42.7 % ​ ​ (334) ​ 9.1 % Cardiovascular ​ ​ 1,108 ​ 62.0 % ​ ​ 1,556 ​ 69.1 % ​ ​ (448) ​ (7.1) % Cost of goods sold, excluding intangible asset amortization ​ ​ 10,270 ​ 57.9 % ​ ​ 10,294 ​ 58.4 % ​ ​ (24) ​ (0.5) % Intangible asset amortization expense ​ ​ 3,398 ​ (13.9) % ​ ​ 3,398 ​ (13.7) % ​ ​ — ​ (0.2) % Total Cost of Goods Sold ​ $ 13,668 ​ 43.9 % ​ $ 13,692 ​ 44.7 % ​ $ (24) ​ (0.7) % ​ Total cost of goods sold was unchanged at $13.7 million for both the years ended December 31, 2024 and 2023.
Our distribution agreement with Tiger terminated in October 2025. 64 ​ Table of Contents Cost of Goods Sold Cost of goods sold and gross margin percentage information for our products is summarized as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 ​ ​ 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross ​ ​ ​ ​ ​ Gross ​ ​ Change 2024 / 2025 (in thousands, except percentages) ​ Amount ​ Margin % ​ ​ ​ ​ Amount ​ Margin % ​ ​ ​ ​ $ ​ % Products: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Women's Health ​ 3,986 ​ 56.4 % ​ ​ 5,568 ​ 51.8 % ​ ​ (1,582) ​ 4.6 % Cardiovascular ​ ​ 634 ​ 79.9 % ​ ​ 1,107 ​ 62.0 % ​ ​ (473) ​ 17.9 % Cost of goods sold, excluding intangible asset amortization ​ ​ 4,620 ​ 62.4 % ​ ​ 6,675 ​ 53.9 % ​ ​ (2,055) ​ 8.5 % Intangible asset amortization expense ​ ​ 1,077 ​ (8.8) % ​ ​ 1,077 ​ (7.4) % ​ ​ — ​ (1.3) % Total Cost of Goods Sold ​ $ 5,697 ​ 53.7 % ​ $ 7,752 ​ 46.4 % ​ $ (2,055) ​ 7.2 % ​ Total cost of goods sold decreased $2.1 million to $5.7 million in the year ended December 31, 2025 compared to $7.8 million in the year ended December 31, 2024.
Each 2023 Prefunded Warrant is exercisable at any time at a nominal exercise price per share of $0.001 (with the remainder of the exercise price per share of Class A Common Stock having been prefunded to us). ​ We expect our losses to continue for the foreseeable future and these losses will continue to have an adverse effect on our financial position.
Each 2023 Prefunded Warrant is exercisable at any time at a nominal exercise price per share of $0.001 (with the remainder of the exercise price per share of Class A Common Stock having been prefunded to us). ​ On October 1, 2025, in connection with and through the proceeds of the sale of the Company’s CIED Business described in Note 2 to the consolidated financial statements, we fully repaid the SWK Loan Facility as required by the terms of the credit agreement.
As a percentage of sales, sales and marketing expenses decreased to 51.5% in the year ended December 31, 2024 from 52.9% in the year ended December 31, 2023. The decrease in expense was largely attributable to a reduction in force which occurred in the first quarter of 2023 and primarily impacted certain members of sales and marketing management.
As a percentage of sales, sales and marketing expenses increased to 46.9% in the year ended December 31, 2025 from 34.5% in the year ended December 31, 2024. The increase was largely attributable to sales commission expense growth commensurate with the resumption in the second quarter of 2025 of the direct selling of our Cardiovascular products.
In the second half of 2024, our insurance available to cover such costs was fully utilized. 86 ​ Table of Contents Net Cash Used in Investing Activities Net cash used in investing activities for the year ended December 31, 2024 was $0.4 million compared to net cash provided by investing activities of $14.2 million for the year ended December 31, 2023.
Net Cash From Investing Activities Net cash provided by investing activities for the year ended December 31, 2025 was $78.6 million compared to net cash used in investing activities of $0.5 million for the year ended December 31, 2024. The significant cash generation in 2025 resulted from the sale of our CIED Business which yielded proceeds of $80.4 million.
General and Administrative G&A expenses increased $4.6 million, or 32.3%, to $18.7 million in the year ended December 31, 2024 compared to $14.1 million in the year ended December 31, 2023. As a percentage of net sales, G&A expenses increased to 76.5% in the year ended December 31, 2024 from 57.0% in the year ended December 31, 2023.
General and Administrative G&A expenses decreased $3.0 million, or 16.6%, to $15.1 million in the year ended December 31, 2025 compared to $18.1 million in the year ended December 31, 2024. The decrease in expense was primarily driven by lower non-cash equity compensation in the 2025 period.
Outside of our direct sales force, we incur significant expenses relating to commissions to our CanGaroo and SimpliDerm commercial partners and independent sales agents. Additionally, this expense category includes distribution costs as well as market research, trade show attendance, advertising and public relations related to our products, and customer service expenses.
Additionally, this expense category includes distribution and customer service costs as well as market research, trade show attendance, advertising and public relations related to our products. General and Administrative Expenses General and administrative (“G&A”) expenses consist primarily of compensation, consulting, legal, human resources, information technology, accounting, insurance (including directors and officer premiums), SEC compliance, and general business expenses.
Over the last several years, our R&D efforts have primarily related to activities associated with the development of EluPro (referred to as CanGarooRM during development).
Over the last several years, our product development efforts have primarily related to activities associated with the development of EluPro, our initial DEB product offering, which gained FDA clearance in June 2024 and was sold in connection with the divestiture of the CIED Business in October 2025.
Interest Expense Interest expense was approximately $4.8 million in the year ended December 31, 2024 compared to $5.8 million in the year ended December 31, 2023.
See further discussion in Note 17 to the consolidated financial statements. ​ Interest (Income) Expense, net ​ Interest (income) expense, net was interest income of $0.4 million in the year ended December 31, 2025 and interest expense of $0.9 million in the year ended December 31, 2024.
Our inability to achieve and then maintain profitability would negatively affect our business, financial condition, results of operations and cash flows. ​ In order to mitigate the current and potential future liquidity issues caused by the matters noted above, we may seek to raise capital through the issuance of common stock, such as the 2025 Registered Offering, 2024 Registered Offering and Private Offering described above, pursue asset sale or other transactions, such as the sale of the Orthobiologics Business described above.
We may seek to raise capital through the issuance of common stock or debt such as the offerings described below or pursue asset sales or other transactions, such as the sale of the Orthobiologics and CIED Businesses described above.
Such indebtedness currently has a principal payment commencement date of November 15, 2025, with quarterly principal payments in an amount equal to 5% of the outstanding principal. In addition, we are party to a royalty agreement with Ligand Pharmaceuticals Incorporated (“Ligand”) pursuant to a long-term obligation to Ligand (the “Revenue Interest Obligation”).
In consideration for the amendment, the Company agreed to issue SWK 50,000 shares of its Class A Common Stock in a private placement. ​ Ligand Revenue Interest Obligation ​ We are also a party to a royalty agreement with Ligand Pharmaceuticals Incorporated (“Ligand”) pursuant to which we have incurred a long-term obligation to Ligand (the “Revenue Interest Obligation”).
“Risk Factors — Risks Related to Our Business — Our future capital needs are uncertain and we may need to raise funds in the future, and such funds may not be available on acceptable terms or at all .” Based on our current operating plans, we believe there is uncertainty as to whether our future cash flows along with our existing cash, issuances of additional equity and cash generated from expected future sales will be sufficient to meet our anticipated operating needs through twelve months from the financial statement issuance date.
“Risk Factors — Risks Related to Our Business — Our future capital needs are uncertain and we may need to raise funds in the future, and such funds may not be available on acceptable terms or at all .” Off-Balance Sheet Arrangements As of December 31, 2025, we did not have any off-balance sheet arrangements, as defined under SEC Regulation S-K Item 303(a)(4)(ii). 71 ​ Table of Contents Critical Accounting Policies and Significant Judgments and Estimates The preparation of financial statements in conformity with U.S.
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“Risk Factors” of this Annual Report. 77 ​ Table of Contents Overview At Elutia, our mission is to humanize medicine so that patients can thrive without compromise.
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Overview At Elutia, our mission is to humanize medicine so that patients can thrive without compromise. We develop proprietary drug-eluting biomatrix products for use in surgical reconstruction and related applications. These products are designed to improve the interaction between implanted medical devices and patients.
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As a commercial-stage company, we seek to leverage our unique understanding of biologics combined with local drug delivery to improve the interaction between implanted medical devices and patients by reducing complications associated with these surgeries. These complications include infection, device migration, erosion, implant rejection, non-union of implants, fibrosis and scar formation.
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Our focus is on addressing unmet medical needs and reducing complications associated with surgery, including infection, migration, erosion, implant rejection, and fibrosis. Our operations span research and development through the commercial distribution of biologic matrix products used in plastic and reconstructive surgery. ​ We have applied these capabilities to develop and commercialize products for specific surgical applications.
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We estimate that in 2024, more than 700,000 surgical procedures were performed annually in the United States involving the implantation of medical devices such as pacemakers, defibrillators, neurostimulators or tissue expanders for breast reconstruction.
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As more fully described below, on October 1, 2025, we divested one such product family through the sale of substantially all of the assets related to our business of developing, commercializing, manufacturing, selling and marketing our cardiac implantable electronic device (“CIED”) products, EluPro™ and CanGaroo®, to Boston Scientific Corporation (“BSC”) and Cardiac Pacemakers Inc (“CPI”) for an aggregate purchase price of up to $88.0 million in cash.
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This number has been driven by advances in medical device technologies, reimbursement models focused on patient outcomes, and an aging population with a growing incidence of comorbidities, including diabetes, obesity and cardiovascular and peripheral vascular diseases.
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EluPro was the first antibiotic-eluting biologic matrix envelope for use with CIEDs. This transaction reflects the technical and commercial value of solutions developed using our biologic matrices and local drug delivery capabilities. ​ 60 ​ Table of Contents Following the sale of the CIED business, we are focused on advancing our drug-eluting biomatrix (“DEB”) platform.
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These comorbidities can exacerbate various immune responses and contribute to other complications upon device implant. ​ Our products are targeted to address unmet clinical needs with the goal of promoting healthy tissue formation and avoiding complications associated with medical device implants, such as scar tissue formation, capsular contraction, erosion, migration and infection.
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This platform builds on our biologic matrix and local drug delivery capabilities to address complications that lead to poor outcomes in reconstructive procedures and surgical repair. EluPro demonstrated the commercial potential of combining a biologic scaffold with antibiotic drug delivery to reduce device-related complications.
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We currently focus on two priority markets – Device Protection and Women’s Health. In Device Protection, we sell EluPro, a unique bioenvelope designed to mitigate CIED complications including infection, device migration and erosion. The bioenvelope features a biomatrix comprised of ECM, which supports healthy wound healing and may facilitate re-operative procedures by reducing scar formation and fibrosis.
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We believe the same foundational technology can be applied to reconstructive and soft tissue repair markets where biologic matrix products are widely used, but where outcomes remain suboptimal due to complications such as infection, inflammation, and fibrosis. ​ The clinical and economic need in the reconstructive and soft tissue repair markets is substantial, reflecting both the volume of reconstructive surgery and the persistence of high complication rates.
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Additionally, EluPro is embedded with the powerful antibiotics rifampin and minocycline, which are gradually released into the surrounding tissue over several weeks post-implantation to provide antimicrobial protection. Currently, EluPro is the only drug-eluting biomatrix (“DEB”) offering in the U.S. implantable electronic device protection market.
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For example, in implant-based breast reconstruction and complex abdominal wall repair, infection rates approximate 15% to 20%, leading to frequent reoperations and hospital readmissions. Each year, in the United States, there are approximately 163,000 post-mastectomy breast reconstruction procedures, and roughly one in three experiences a serious complication such as infection, capsular contracture, or implant loss.
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Alongside EluPro, we market the CanGaroo bioenvelope, our first generation product, which uses the same biomatrix but does not contain antibiotics. ​ In Women’s Health, we have developed both patented and proprietary technologies, culminating in the creation of SimpliDerm—a novel biological matrix that leverages the inherent science of natural healing processes.
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We believe biologic matrices represent an estimated $1.5 billion U.S. market opportunity and account for more than 60% of reconstruction spending, yet meaningful innovation has been limited and significant unmet medical need remains. ​ Our lead development programs comprise NXT-41, a next-generation biologic matrix, and NXT-41x, which builds on the NXT-41 matrix by incorporating local antibiotic delivery.
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SimpliDerm’s design uses human-based hydrated acellular dermal matrix with heightened structural integrity and superior handling capabilities, which may mitigate inflammation and enhance tissue incorporation, leading to a better healing experience as compared to other ADM products.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAccordingly, we cannot assure you that our financial condition and results of operations will not be materially impacted by inflation in the future.
Biggest changeAccordingly, we cannot assure you that our financial condition and results of operations will not be materially impacted by inflation in the future. Item 8. Financial Statements and Supplementary Data. The financial statements required to be filed pursuant to this Item 8 are appended to this Annual Report and are incorporated herein by reference. ​ Item 9.
While it is difficult to accurately measure the impact of inflation due to the imprecise nature of the estimates required, we do not believe inflation had a material effect on our financial condition or results of operations during the years ended December 31, 2024 and 2023.
While it is difficult to accurately measure the impact of inflation due to the imprecise nature of the estimates required, we do not believe inflation had a material effect on our financial condition or results of operations during the years ended December 31, 2025 and 2024.
Credit Risk As of December 31, 2024, our cash and cash equivalents were maintained with two financial institutions in the United States. While our deposit accounts are insured up to the legal limit, the balances we maintain may, at times, exceed this insured limit.
Credit Risk As of December 31, 2025, our cash and cash equivalents were maintained with two financial institutions in the United States. While our deposit accounts are insured up to the legal limit, the balances we maintain may, at times, exceed this insured limit.
One customer represented 14% of our accounts receivable as of December 31, 2024. Foreign Currency Risk Our business is primarily conducted in U.S. dollars. Any transactions that may be conducted in foreign currencies are not expected to have a material effect on our financial condition, results of operations or cash flows.
One customer represented 13% of our accounts receivable as of December 31, 2025. Foreign Currency Risk Our business is primarily conducted in U.S. dollars. Any transactions that may be conducted in foreign currencies are not expected to have a material effect on our financial condition, results of operations or cash flows.
As we grow our operations, our exposure to foreign currency risk could become more significant. Inflation Risk Inflationary factors, such as increases in our cost of goods sold or other operating expenses, may adversely affect our operating results.
As we grow our operations, our exposure to foreign currency risk could become more significant. 74 ​ Table of Contents Inflation Risk Inflationary factors, such as increases in our cost of goods sold or other operating expenses, may adversely affect our operating results.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. We are exposed to market risks in the ordinary course of our business, including risks relating to changes in interest rates, foreign currency and inflation. The following discussion provides additional information regarding these risks. Interest Rate Risk Our primary exposure to market risk relates to changes in interest rates.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. We are exposed to market risks in the ordinary course of our business, including risks relating to changes in interest rates, foreign currency and inflation. The following discussion provides additional information regarding these risks.
As of December 31, 2024 we maintained $12.2 million in bank deposit accounts that are in excess of the federally insured limit in one federally insured financial institution. The Company has not experienced any losses in such accounts. Our accounts receivable relate to sales to customers. To minimize credit risk, ongoing credit evaluations of all customers’ financial condition are performed.
As of December 31, 2025 we maintained $35.0 million in bank deposit accounts that are in excess of the federally insured limit in one federally insured financial institution. The Company has not experienced any losses in such accounts. Our accounts receivable relate to sales to customers. To minimize credit risk, ongoing credit evaluations of all customers’ financial condition are performed.
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Borrowings under our SWK Loan Facility bear interest at variable rates, subject to an interest rate floor. Interest rate risk is highly sensitive due to many factors, including U.S. monetary and tax policies, U.S. and international economic factors and other factors beyond our control.
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Interest Rate Risk With the repayment of our SWK Loan Facility on October 1, 2025 (see “Credit Facilities” in Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations), we are no longer subject to any material interest rate risk, which was formerly our primary exposure to market risk.
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A hypothetical 10% relative change in interest rates to our variable rate indebtedness outstanding during the years ended December 31, 2024 or 2023 would not have had a material effect on our financial statements. We do not currently engage in hedging transactions to manage our exposure to interest rate risk.
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Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. None. ​

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