What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2026-03-03 compared with 2025-03-17 · 171 added, 115 removed, 743 unchanged (28% of the section changed)

29 unchanged sentences

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which they relate.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Reserve for Excess and Obsolete Inventories — Refer to Notes 2 and 5 to the financial statements

67 unchanged sentences

(Loss) income from operations

Interest and other income (expense), net

Interest and other income, net

(Loss) income before income taxes

Provision for income taxes

(Loss) income from continuing operations

Loss from continuing operations

Loss from discontinued operations, net of tax

(Loss) earnings per share:

Loss per share:

Continuing operations

18 unchanged sentences

Stock-based compensation expense

Repurchase of common stock

Retirement of common stock for minimum tax withholdings

9 unchanged sentences

Balance, December 31, 2024

Issuance of common stock for equity awards

Vesting of restricted stock units

15 unchanged sentences

Non-cash operating lease cost

Loss on disposal of fixed assets

(Gain) loss on sale of assets

Loss on impairment of long-lived assets

3 unchanged sentences

Provision for inventory

Interest income on notes receivable

Changes in operating assets and liabilities:

7 unchanged sentences

Purchases of property and equipment

Proceeds from sale of Parcus

Note receivable

Proceeds from sale of intangible asset

Acquisition of intangible asset

1 unchanged sentence

Cash flows from financing activities:

Payments made on finance leases

Repurchases of common stock

2 unchanged sentences

Proceeds from exercises of equity awards

Payments of contingent consideration

Net cash used in financing activities

Exchange rate impact on cash

Decrease in cash and cash equivalents

Increase (decrease) in cash and cash equivalents

Cash and cash equivalents at beginning of period

20 unchanged sentences

In October 2024, the Company announced a strategic shift to concentrate on OA Pain Management and Regenerative Solutions.

This strategic decision resulted in the sale of Arthrosurface on October 31.

2024 and the sale of Parcus Medical on March 7, 2025, both of which were acquired in early 2020.

This strategic decision resulted in the sale of Arthrosurface on October 31, 2024 and the sale of Parcus Medical on March 7, 2025, both of which were acquired in early 2020.

The Company is subject to risks common to companies in the life sciences industry including, but not limited to, development by the Company or its competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, commercialization of existing and new products, and compliance with U.S.

9 unchanged sentences

All intercompany balances and transactions have been eliminated in consolidation.

As noted above , the Company made a strategic decision in October 2024 that resulted in the sales of Arthrosurface and Parcus Medical.

As noted above, the Company made a strategic decision in October 2024 that resulted in the divestitures of Arthrosurface and Parcus Medical.

The consolidated financial statements reflect the Arthrosurface and Parcus results of operations as discontinued operations, and the related assets and liabilities as held-for-sale for all periods presented.

13 unchanged sentences

In determining the adequacy of the allowance, management specifically analyzes individual accounts receivable, historical bad debts, customer concentrations, customer creditworthiness, current and reasonable and supportable forecasts of future economic conditions, accounts receivable aging trends, and changes in the Company’s customer payment terms.

The components of the Company’s accounts receivables are as follows:

The components of the Company’s accounts receivable are as follows:

As of December 31,

19 unchanged sentences

and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.

The Company generates sales principally through three types of customers:

The Company generates sales principally through the sale of products to three types of customers:

(i) commercial partnerships (ii) hospitals and ambulatory surgical centers (“ASCs”), and (iii) distributors, referred to as the distribution model.

For commercial partnership sales, the Company sells its products directly to these partners, who perform most of the downstream sales and marketing activities to customers and end-users.

These arrangements may include the grant of certain licenses, performance of development services, and the supply of product.

The Company’s largest such customer, Johnson & Johnson MedTech (“J&J MedTech”) (previously known as DePuy Synthes Mitek Sports Medicine), a division of DePuy Orthopedics, Inc., part of the Johnson & Johnson Medical Companies, represented 57 %, 62 % and 60 % of total revenues for the years-ended December 31, 2024, 2023 and 2022 respectively.

The Company completed the performance obligations related to granted licenses and development services under the agreements with J&J MedTech prior to 2016 and has no remaining material performance obligations.

These arrangements may include the grant of certain licenses, performance of development services, and the supply of products.

The Company recognizes revenue from product sales when the customer obtains control of the Company’s product, which typically occurs upon shipment to the customer.

Commercial partnership agreements may also include sales-based royalties and milestones.

As the Company considered the license to be the predominant item to which the royalties relate for these agreements, sales-based royalties and milestones are only recognized when the later of the underlying sale occurs or the performance obligation to which the sales-based royalty has been satisfied (or partially satisfied).

This is generally in the same period that the Company’s licensees complete their product sales in their territory, for which the Company is contractually entitled to a percentage-based royalty.

Commercial partnership agreements may also include variable revenue measured as a percentage of sales to end-customers (“sales-based royalties”) and milestones.

Sales-based royalties and milestones are only recognized when the latter of the underlying sale occurs or the performance obligation to which the sales-based royalty has been satisfied (or partially satisfied).

This is generally in the same period that the Company’s commercial partners complete their product sales in their territory, for which the Company is contractually entitled to a percentage-based royalty.

The Company records royalty revenues based on estimated net sales of licensed products as reported to the Company by its commercial partners.

4 unchanged sentences

Substantially all the Company’s supply agreements do not provide options that are considered material rights.

For sales to hospitals and ASCs, which generally pairs in-house sales representatives with local or regional distributors, the inventory is generally consigned so that products are available when needed for surgical procedures.

The Company’s largest such customer, Johnson & Johnson MedTech (“J&J MedTech”) (previously known as DePuy Synthes Mitek Sports Medicine), a division of DePuy Orthopedics, Inc., part of the Johnson & Johnson Medical Companies, represented 50%, 57% and 62% of total revenues for the years-ended December 31, 2025, 2024 and 2023 respectively.

The Company’s collaboration agreement with J&J MedTech include contracts with Orthovisc and Monovisc products, which were entered into in 2003 and 2011, respectively.

Pursuant to the J&J MedTech contracts, the Company is the exclusive supplier responsible for the manufacture and sale to J&J MedTech of the Orthovisc and Monovisc products pursuant to J&J MedTech’s purchase orders, while J&J MedTech is responsible for the marketing, sales and distribution to end-customers.

In general, the Company’s long-term contractual arrangements do not allow for any other product source suppliers for the OEM Channel partners.

Furthermore, given the proprietary nature of the products, manufacturing would not be easily replicated by the OEM Channel partners, including J&J MedTech nor would an alternative source of supply be available, such that the product supply and license are not distinct.

For these reasons, the Company believes that revenue earned from the combined fixed and variable consideration paid for the sales of the product meets the objective of ASC 606-10-50-5 in depicting how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors.

For sales to hospitals and ASCs, which generally pair in-house sales representatives with local or regional distributors, the inventory is generally consigned so that products are available when needed for surgical procedures.

No revenue is recognized upon the placement of inventory into consignment, as the Company retains the ability to control the inventory.

11 unchanged sentences

If the prospective discounts or free-of-charge sample units are considered material rights, these would be separate performance obligations and a portion of the sales transaction price is allocated to the material right.

Revenue allocated to the material right is recognized when the additional goods are transferred to the customer or when the option expires.

Revenue allocated to the material rights are recognized when the additional goods are transferred to the customer or when the option expires.

During 2025, 2024 and 2023, the consideration allocated to material rights was not significant.

4 unchanged sentences

Generally, customer contracts contain Free on Board (“FOB”) or Ex-Works shipping point terms where the customer pays the shipping company directly for all shipping and handling costs.

In those contracts in which the Company pays for the shipping and handling, the associated costs are generally recorded along with the product sale at the time of shipment in cost of revenue when control over the products has transferred to the customer.

Value-add and other taxes collected by the Company concurrently with revenue-producing activities are excluded from revenue.

Value-add and other taxes collected by the Company with revenue-producing activities are excluded from revenue.

The Company’s general product warranty does not extend beyond an assurance that the product or services delivered will be consistent with stated contractual specifications, which does not create a separate performance obligation.

15 unchanged sentences

Investments with remaining maturities greater than one year are classified as long-term investments.

The Company had no investments as of December 31, 2024 or December 31, 2023.

The Company had no long-term investments as of December 31, 2025 or December 31, 2024.

Investments are subject to a periodic impairment review.

35 unchanged sentences

As such, the Company utilizes the appropriate incremental borrowing rates, which are the rates that would be incurred to borrow on a collateralized basis, over similar terms, amounts equal to the lease payments in a similar economic environment.

Variable payments that do not depend on a rate or index are not included in the lease liability and are recognized as incurred.

Lease contracts do not include residual value guarantees nor do they include restrictions or other covenants.

16 unchanged sentences

Construction-in-process assets are not depreciated until such time as the relevant assets are completed and put into use.

Goodwill and IPR&D Assets

Goodwill and In-Process Research and Development ( “ IPR&D ” ) Assets

Goodwill is the amount by which the purchase price of acquired net assets in a business combination exceeded the fair values of net identifiable assets on the date of acquisition.

Acquired In-Process Research and Development (“IPR&D”) represents the fair value assigned to research and development assets that the Company acquires that have not been completed at the date of acquisition or are pending regulatory approval in certain jurisdictions.

The value assigned to the acquired IPR&D is determined by estimating the costs to develop the acquired technology into commercially viable products, estimating the resulting revenue from the projects, and discounting the net cash flows to present value.

Goodwill and IPR&D are not amortized but are evaluated for impairment annually or more frequently if events or changes in circumstances indicate that the asset might be impaired.

The value assigned to the acquired IPR&D assets is determined by estimating the costs to develop the acquired technology into commercially viable products, estimating the resulting revenue from the projects, and discounting the net cash flows to present value.

Goodwill and IPR&D assets are not amortized but are evaluated for impairment annually or more frequently if events or changes in circumstances indicate that the asset might be impaired.

The goodwill impairment assessment is performed by reporting unit.

2 unchanged sentences

The Company has currently one reporting unit that it is has defined as its the legacy Anika reporting unit, which specializes in therapies based on its hyaluronic acid (“HA”) technology platform.

It previously had a second reporting unit established in 2020 upon the acquisitions of Parcus Medical and Arthrosurface.

Factors that the Company considers important, on an overall company basis, that could trigger an impairment review include significant underperformance relative to historical or projected future operating results, significant changes in the Company’s use of the acquired assets or the strategy for its overall business, significant negative industry or economic trends, a significant decline in the Company’s stock price for a sustained period, or a reduction of its market capitalization relative to net book value.

GAAP, the Company has the option to perform a qualitative assessment to determine if it is necessary to perform the impairment test.

If the Company concludes, based on a qualitative assessment, it is not more likely than not that the Goodwill or the IPR&D asset is impaired, the Company is not required to perform the quantitative test.

If the Company concludes, based on a qualitative assessment, it is not more likely than not that Goodwill or the IPR&D assets are impaired, the Company is not required to perform the quantitative test.

The Company has an unconditional option to bypass the qualitative assessment in any period and proceed directly to the quantitative impairment test.

1 unchanged sentence

If the reporting unit’s carrying value exceeds its fair value, the Company records an impairment loss to the extent that the carrying value of goodwill exceeds its implied fair value, not to exceed the recorded amount of goodwill.

The Company performed a qualitative annual assessment for impairment of the remaining goodwill with respect to legacy Anika reporting unit as of November 30, 2024, including consideration of (i) general macroeconomic factors, (ii) industry and market conditions, and (iii) the extent of the excess of the fair value over the carrying value indicated in prior impairment testing.

Accordingly, the Company determined it was not more likely than not that the fair value of the legacy Anika reporting unit is less than its carrying amount and thus goodwill was not impaired as of November 30, 2024.

To conduct impairment tests of IPR&D, the fair value of the IPR&D project is compared to its carrying value.

The Company performed a quantitative annual assessment for impairment of the remaining goodwill with respect to legacy Anika reporting unit as of November 30, 2025, where the estimated fair value of the reporting unit was based on a combination of an income and market approach.

The discounted cash flow method of the income approach which is based on the present value of projected cash flows and a terminal value, which represents the expected normalized cash flows of the reporting units beyond the cash flows from the discrete projection period.

The market approach utilizes our market capitalization plus an appropriate control premium, whereby the market capitalization is determined by multiplying the number of shares of common stock outstanding by the market price of our common stock and the control premium is determined by utilizing data from publicly available premium studies for similarly situated public company transactions.

As a result of this impairment testing, the Company determined it was not more likely than not that the fair value of the legacy Anika reporting unit is less than its carrying amount and thus goodwill was not impaired as of November 30, 2025.

To conduct impairment tests of IPR&D assets, the fair value of the IPR&D project is compared to its carrying value.

If the carrying value exceeds its fair value, the Company records an impairment loss to the extent that the carrying value of the IPR&D project exceeds its fair value.

The Company estimates the fair value for IPR&D using the income approach, which is based on the Multi-Period Excess Earnings Method (“MPEEM”).

The Company estimates the fair value for IPR&D assets using the income approach, which is based on the Multi-Period Excess Earnings Method (“MPEEM”).

MPEEM measures economic benefit indirectly by calculating the income attributable to an asset after appropriate returns are paid to complementary assets used in conjunction with the subject asset to produce the earnings associated with the subject asset, commonly referred to as contributory asset charges.

24 unchanged sentences

Non-Recurring Fair Value Measurement

In measuring the impairment of intangible assets, the fair value of the Company's developed technology, customer relationship and tradename definite lived intangible assets within the Parcus and Arthrosurface reporting unit are classified within Level 3 of the fair value hierarchy because of the use of unobservable inputs in measuring the estimated fair value.

In measuring the impairment of intangible assets, the fair value of the Company's developed technology definite lived intangible assets are classified within Level 3 of the fair value hierarchy because of the use of unobservable inputs in measuring the estimated fair value.

When performing a quantitative assessment for impairment of these definite lived intangible assets, the Company measures the amount of impairment by calculating the amount by which the carrying value of the definite lived intangible assets exceeds its estimated fair value (as discussed in Note 7 – Acquired Intangible Assets, Net).

25 unchanged sentences

Although the outcomes of any potential legal proceedings are inherently difficult to predict, the Company does not expect the resolution of any potential legal proceedings to have a material adverse effect on its financial position, results of operations, or cash flows.

Recent Issued Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In December 2023, the FASB issued Accounting Standards Update 2023-09, Improvements to Income Tax Disclosures, ( “ ASU 2023-09 ” ), which is effective for annual periods beginning after December 15, 2024.

ASU 2023-09 intends to enhance the transparency as well as usefulness of income tax disclosures, primarily related to the rate reconciliation and income taxes paid.

The Company is currently assessing the impact that adoption of this new accounting guidance will have on its consolidated financial statements and footnote disclosures.

Recently Adopted Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures , requiring public entities to disclose information about their reportable segments’ significant expenses and other segment items on an interim and annual basis.

Public entities with a single reportable segment are required to apply the disclosure requirements in ASU 2023-07, as well as all existing segment disclosures and reconciliation requirements in ASC 280 in an interim and annual basis.

The Company adopted ASU 2023-09 during the year ended December 31, 2025.

See Note 18 Segment Information in the accompanying notes to the consolidated financial statements for further detail.

See Note 17 Income Taxes in the accompanying notes to the consolidated financial statements for further detail.

Recent Issued Accounting Pronouncements

In November 2024, the FASB issued ASU No.

2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) :

Disaggregation of Income Statement Expenses , and in January 2025, the FASB issued ASU No.

2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Clarifying the Effective Date .

ASU 2024-03 requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement.

ASU 2024-03, as clarified by ASU 2025-01, is effective for public companies for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027.

Early adoption is permitted.

The Company is evaluating the impact of ASU 2024-03 on its disclosures.

Discontinued Operations

10 unchanged sentences

The Company valued the consideration with the sale of the Arthrosurface asset group to be $ 5.9 million and recorded as Notes Receivable on its balance sheet at December 31, 2024.

The Notes Receivable balance was $ 5.6 million at December 31, 2025.

As a result of the Arthrosurface Transaction, the Company tested the assets associated with the Arthrosurface asset group to determine if the carrying value of the assets at September 30, 2024 were fully recoverable.

7 unchanged sentences

Given that the proceeds from the sale of the Parcus Medical assets group was less than the carrying value of its net assets, the Company recorded asset impairment charges totaling $ 20.1 million during the three-month period ended December 31, 2024 related to a write-down of its inventories, property and equipment and intangible assets related to the Parcus Medical asset group.

The results of operations for Arthrosurface and Parcus are reported in income from discontinued operations within the consolidated statements of operations for the years ended December 31, 2024, 2023 and 2022, and the related assets and liabilities are presented within assets and liabilities held-for-sale on the consolidated balance sheets as of December 31, 2024 and 2023.

The results of operations for Arthrosurface and Parcus are reported in income from discontinued operations within the consolidated statements of operations for the years ended December 31, 2025, 2024 and 2023, and the related assets and liabilities are presented within assets and liabilities held-for-sale on the consolidated balance sheets as of December 31, 2024.

Years Ended December 31,

10 unchanged sentences

Right-of-use assets

Other long-term assets

Intangible assets, net

Total assets held-for-sale

3 unchanged sentences

Total liabilities held-for-sale

There are no assets and liabilities reported as held-for-sale as of December 31, 2025, as the Company completed the divestitures of the Arthrosurface and Parcus Medical asset groups during the year ended December 31, 2025.

Selected financial information related to significant operating and investing cash flow items from discontinued operations are as follows (in thousands):

9 unchanged sentences

The Company’s investments, including cash equivalents, are all classified within Levels 1 of the fair value hierarchy and are valued based on quoted prices in active markets.

For cash, current receivables, notes receivable, accounts payable, and accrued interest, the carrying amounts approximate fair value, because of the short maturity of these instruments, and therefore fair value information is not included in the table below.

Contingent consideration related to the previously described business combinations are classified within Level 3 of the fair value hierarchy as the determination of fair value uses considerable judgement and represents the Company’s best estimate of an amount that could be realized in a market exchange for the asset or liability.

For cash, accounts receivable, accounts payable, and accrued interest, the carrying amounts approximate fair value, because of the short maturity of these instruments, and therefore fair value information is not included in the table below.

The classification of the Company’s cash equivalents and investments within the fair value hierarchy is as follows:

13 unchanged sentences

Money Market Funds

There were no transfers between fair value levels in 2024 or 2023.

There were no transfers between fair value levels during the years ended December 31, 2025 and 2024, respectively.

Total inventories included in the balance sheet consist of the following:

22 unchanged sentences

Developed technology

Distributor relationships

Year Ended December 31, 2024

Currency Translation

Accumulated Currency

Translation Adjustment

Net Book Value

Average Useful

Life (in Years)

Developed technology

1 unchanged sentence

Total amortization expense with respect to the definite lived acquired intangible assets was $ 0.4 million, $ 0.7 million and $ 0.6 million for each of the years ended December 31, 2025, 2024 and 2023, respectively.

The Company performed an assessment of its definite lived acquired intangible assets during the quarter ended December 31, 2024.

The Company estimated the fair value of its definite lived acquired intangible assets using an income approach method of valuation, including a combination of the distributor method for the customer relationships intangible asset and the relief of royalty method for each of the developed technology and tradename intangible assets.

These valuation approaches incorporate significant estimates and assumptions related to the forecasted results including revenues, expenses, expected economic life of the asset, royalty rates, after-tax royalty savings expected from ownership of the developed technology and tradename assets, contributory asset charges and discount rates to estimate future cash flows.

While assumptions utilized are subject to a high degree of judgment and complexity, the Company made its best estimate of future cash flows under a high degree of economic uncertainty that existed as of December 31, 2024.

In developing its assumptions, the Company also considered observed trends of its industry participants.

As of December 31, 2025, the Company’s definite lived acquired intangible assets are fully amortized.

The Company performed its annual assessment of the IPR&D intangible asset as of November 30, 2025.

10 unchanged sentences

Balance, ending December 31

The goodwill balance at December 31, 2024 and 2023 was related to the legacy Anika reporting unit.

The Company estimated the fair value of its reporting units using a discounted cash flow method, which is based on the present value of projected cash flows and a terminal value, which represents the expected normalized cash flows of the reporting units beyond the cash flows from the discrete projection period.

The Company determined that a discounted cash flow model provided the best approximation of fair value of the reporting units for the purpose of performing the impairment test.

The goodwill balance at December 31, 2025 and 2024 was related to the Company’s legacy Anika reporting unit.

The Company estimated the fair value of its reporting unit using a combination of the income and market approaches.

The discounted cash flow method of the income approach estimates the present value of projected cash flows and a terminal value, which represents the expected normalized cash flows of the reporting units beyond the cash flows from the discrete projection period.

This approach incorporates significant estimates and assumptions related to the forecasted results including revenues, expenses, the achievement of certain cost synergies, terminal growth rates and discount rates to estimate future cash flows.

1 unchanged sentence

In developing its assumptions, the Company also considered observed trends of its industry participants.

For the legacy Anika reporting unit, the Company performed a qualitative assessment as of November 30, 2024.

In addition, the Company estimated the fair value of its reporting unit based on its market capitalization and an appropriate control premium.

Market capitalization is determined by multiplying the number of shares of common stock outstanding by the market price of its common stock.

The control premium, or the amount paid by a new controlling shareholder for the benefits resulting from synergies and other potential benefits derived from controlling the acquired company, is determined by utilizing data from publicly available premium studies for similarly situated public company transactions.

For its legacy Anika reporting unit, the Company performed a quantitative assessment as of November 30, 2025.

The results of the impairment test indicated that the estimated fair value of the legacy Anika reporting unit was greater than its carrying value, therefore the Company determined that was more likely than not that the fair value of the legacy Anika reporting unit was not impaired as of November 30, 2025.

The Company leases its buildings and manufacturing facilities under operating leases.

As of December 31, 2024, the Company had real estate leases in Bedford, Massachusetts, Sarasota, Florida, Warsaw, Indiana and Padova, Italy and Sarasota, Florida.

As of December 31, 2025, the Company has real estate leases in Bedford, Massachusetts, Warsaw, Indiana and Padova, Italy.

In June 2022, the Company finalized a renewal option to extend the current term for its operating headquarters and manufacturing facility in Bedford through 2027.

There are also lease renewal options into 2038.

There are also lease renewal options into 2038 that the Company is reasonably certain to exercise.

The Company leases office space in Padova, Italy.

The current term of the Padova lease extends to 2032, with a right to terminate at the Company’s option in 2026 without penalty.

The Company had two real estate leases in Sarasota, Florida that it uses for office space and manufacturing and warehouse facilities.

In June 2022, the Company extended its current term on these leases through 2027.

These leases were sold with the Parcus transaction in March 2025.

The Company is not expected to terminate this lease prior to the lease expiration date in 2032.

During 2025, the Company determined that it became reasonably certain that the Company would not exercise its option to terminate and accordingly, the right of use asset and lease liability were increased to account for the lease extension to 2032.

The significant assumptions in recognizing the right-of-use asset and lease liability are as follows:

9 unchanged sentences

Operating lease expense

Short-term lease expense

Variable lease expense

18 unchanged sentences

Compensation and related expenses

Professional fees

Operating lease liability- current

Share based compensation

Operating lease liability - current

Professional fees

Clinical trial costs

21 unchanged sentences

Revenue and Geographic Information

During the year ended December 31, 2024, the Company changed its classification of revenue.

The Company previously disclosed revenue in 3 categories:

OA Pain Management, Joint Preservation and Restoration and Non-Orthopedic.

As a result of a change in strategic focus made in 2024, revenue classification was delineated to provide a clear view to the Company’s value drivers.

Revenue will be split between the Commercial Channel and the Original Equipment Manufacturer (“OEM”) Channel.

In the Commercial Channel, the Company has full responsibility for sales, marketing, and pricing of products through its commercial leaders, direct sales representatives, and independent distributors.

Revenue from our Regenerative Solutions and international OA Pain Management businesses is included in the Commercial Channel.

The Company has two classifications of revenue:

Original Equipment Manufacturer (“OEM”) Channel and the Commercial Channel.

In the OEM Channel, the Company is responsible for development and manufacturing of products sold to the Company’s OEM partners governed by long-term agreements, but the Company does not control sales, marketing, or pricing with end users.

Revenue from the Company’s U.S.

OA Pain Management business and the Non-Orthopedic business is now included in the OEM Channel.

All other revenue is reported in the Commercial Channel.

OA Pain Management business and the Non-Orthopedic businesses is included in the OEM Channel.

Revenue from the Company’s Regenerative Solutions and international OA Pain Management businesses is included in the Commercial Channel.

Product revenue by product family is as follows:

20 unchanged sentences

The Anika Therapeutics, Inc.

2017 Omnibus Incentive Plan (the “2017 Plan”) was approved by the Company’s stockholders on June 13, 2017 and subsequently amended on June 18, 2019, June 16, 2020 and June 16, 2021 and June 14, 2023.

2017 Omnibus Incentive Plan (the “2017 Plan”) was approved by the Company’s stockholders on June 13, 2017 and subsequently amended most recently on June 25, 2024.

On June 25, 2025, the Company’s stockholders approved an amendment to the 2017 Plan increasing the number of shares by 475,000 shares from 5,285,000 shares to 5,760,000 shares.

The 2017 Plan provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights (“SARs”), restricted stock awards (“RSAs”), performance restricted stock units (“PSUs”), restricted stock units (“RSUs”), total shareholder return options (“TSRs”) and performance options that may be settled in cash, stock, or other property.

In accordance with the 2017 Plan approved by the Company’s stockholders, including the amendments thereto, each share award other than stock options or SAR’s will reduce the number of total shares available for grant by two shares.

In accordance with the 2017 Plan approved by the Company’s stockholders, including the amendments thereto, each share award other than stock options or SARs will reduce the number of total shares available for grant by two shares.

Subject to adjustment for specified types of changes in the Company’s capitalization, no more than 4.6 million shares of common stock may be issued under the 2017 Plan.

There are 1.4 million shares available for future grant at December 31, 2025 under the 2017 Plan.

These shares available for future grant exclude 0.9 million of PSUs and RSUs that are subject to liability accounting based on the expectation the shares will be settled in cash.

If these PSUs and RSUs were to be settled in shares at vesting then the Company will have fewer shares available for future issuance.

The Anika Therapeutics, Inc.

32 unchanged sentences

The aggregate intrinsic value of options exercised was immaterial for the years ended December 31, 2025, 2024 and 2023, respectively.

The Company granted 547,450 stock options during the year ended December 31, 2024, of which 421,925 shares were premium-priced options.

The Company granted 16,300 stock options during the year ended December 31, 2025.

The Company uses the Black-Scholes pricing model to determine the fair value of options granted.

6 unchanged sentences

Fair value per option

As of December 31, 2024, there was $ 5.5 million of unrecognized compensation cost related to unvested stock options.

As of December 31, 2025, there was $ 2.4 million of unrecognized compensation related to unvested stock options.

This expense is expected to be recognized over a weighted average period of 1.3 years.

Restricted Stock Units

RSUs generally vest in equal annual installments over a three - or four -year periods.

RSUs generally vest in equal annual installments over a three - or four -year period.

The grant-date fair value of RSUs is recognized as expense on a straight-line basis over the requisite service period, which is generally the vesting period.

8 unchanged sentences

The total fair value of RSUs vested was $ 8.2 million, $ 8.7 million and $ 6.9 million for the years ended December 31, 2025, 2024 and 2023, respectively.

As of December 31, 2024, there was $ 5.1 million of unrecognized compensation cost related to time-based RSUs, which is expected to be recognized over a weighted-average period of 1.4 years.

As of December 31, 2025, the Company had outstanding 342,713 RSUs being treated as equity awards in which $ 1.5 million of unrecognized compensation cost related to time-based RSUs, which is expected to be recognized over a weighted-average period of 0.8 years.

The Company’s annual grants of RSU awards in March 2024 and 2025 can be settled at vesting in cash or shares at the Company’s election.

The Company has recorded these RSU grants as a liability due to the expectation that the Company will settle the vesting of these RSU awards in cash due to a potential shortage of shares in the 2017 Plan at the time of vesting.

As a result, these RSUs will be subject to change in value at the time of each reporting period.

The first tranche of the March 2024 RSU awards vested in March 2025 and the Company issued 106,550 shares to employees.

As of December 31, 2025, the Company had 611,000 RSUs outstanding for which a liability of $ 1.8 million was recorded in Accrued Expenses and Other Liabilities at December 31, 2025 and there is unrecorded compensation cost of $ 4.1 million which is to be recognized over a weighted-average period of 2.0 years.

Performance Stock Units ( “ PSUs ” )

PSU activity for the year ended December 31, 2025 was as follows:

Weighted Average

Outstanding as of December 31, 2024

Forfeited and cancelled

Outstanding as of December 31, 2025

The weighted-average grant-date fair value per share of PSUs granted was $ 15.36 for the year ended December 31, 2025.

There were no PSUs granted in the years ended December 31, 2024 and 2023, respectively.

On March 14, 2025, the Company granted 290,792 PSUs to certain senior management employees.

The Company granted two different PSU awards to each PSU award recipient.

One form of PSU award has a 3-year cliff vest subject to achievement of certain market-based metrics in which 50 - 200 % of target shares granted may vest based on achievement of the specified Company market price targets during the performance period from March 14, 2025 through March 1, 2028.

No shares will vest if these market price targets are not achieved.

The Company estimated the fair value of these market-based PSUs using a Monte Carlo simulation model in which multiple simulations were using inputs based on the Black-Scholes formula using inputs for expected volatility, risk-free interest rate and dividend yield.

The market-based PSUs were valued at the grant date and the Company will continue to use the Monte- Carlo simulation model to update the fair value at the end of each reporting period.

The second form of PSU awards is vesting in equal annual installments of target on each anniversary date of grant over three years, subject to annual achievement of the specified strategic performance objectives each year based upon certain regulatory milestones and financial targets.

Subject to achievement of each milestone, these awards will vest annually on each anniversary date of the grant date over three years.

The Company recognizes stock-based compensation based on the evaluation of probability outcomes of achieving these milestones each reporting period.

The Company’s annual grants of PSU awards in March 2025 can be settled at vesting in cash or shares at the Company’s election.

The Company has recorded these PSUs as a liability due to the expectation that the Company will settle the vesting of these PSU awards in cash due to a potential shortage of shares in the 2017 Plan at the time of vesting.

As a result, these PSUs will be subject to change in value at the time of each reporting period.

As of December 31, 2025, the Company had 279,754 shares outstanding for which a liability of $ 0.6 million was recorded in Accrued Expenses and Other Liabilities and there is unrecorded compensation cost of $ 0.8 million associated with these PSUs which is to be recognized over a weighted-average period of 2.3 years.

Employee Benefit Plan

2 unchanged sentences

Employees may elect to contribute a percentage of their compensation to the plan, and the Company will make 100 % matching contributions up to a limit of 5 % of an employee's eligible compensation.

Effective January 1, 2025, the Company's matching contributions became 100% up to a limit of 5 % of an employee’s eligible compensation.

In addition, the Company may make annual discretionary contributions.

4 unchanged sentences

In the event of positive “free cash flow” as defined in the 2024 Cooperation Agreement dated May 28, 2024, with Caligan Partners LP, Caligan Partners Master Fund LP and David Johnson, for the period from July 1, 2024 through June 30, 2025, the amount under the share repurchase program shall be increased by 50 % of such positive amount and in no event would we be required to make any purchases in the event that our cash would be less than $ 45.0 million after taking into account the share repurchase and reasonably anticipated capital expenditures and restructuring costs.

On May 28, 2024, the Company entered into a share repurchase agreement under a Rule 10b5-1 with Bank of America.

As of December 31, 2024, the Company had repurchased 505,903 shares at a cost of $ 10.9 million, representing 27 % of the then estimated total number of shares expected to be repurchased under the 2024 Share Repurchase Program.

On May 28, 2024, the Company entered into a share repurchase agreement under a Rule 10b5-1 plan with Bank of America and we completed the first $ 15.0 million tranche of the 2024 Share Repurchase Program in March 2025.

On November 6, 2026, the Company entered into a share repurchase agreement under a Rule 10b5-1 plan with Clear Street LLC for another $ 15.0 million related to the 2024 Share Repurchase Program.

As of December 31, 2025, the Company had repurchased 1,308,445 shares at a cost of $ 20.5 million, representing 51 % of the 2024 Share Repurchase Program.

Income Tax Expense

3 unchanged sentences

Years ended December 31,

Provision for (benefit from) income taxes:

Provision for income taxes:

Total current

Total deferred

Total benefit from income taxes

Total provision for income taxes

Deferred Tax Assets and Liabilities

2 unchanged sentences

Capital loss carryforward

Net operating loss carryforwards

Capitalized research expenditures

Lease liability

Acquisition-related intangible asset

Impairment of assets

Stock-based compensation expense

Inventory reserves

Accrued expenses and other

Compensation accrual

Net operating loss carry forwards

Accrued expenses and other

Acquisition-related intangible asset

Impairment of assets

Foreign currency exchange

3 unchanged sentences

Deferred tax liabilities:

Acquisition-related intangible asset

Right of use asset

Acquisition-related intangible asset

Deferred tax liabilities

Net deferred tax assets

As of December 31, 2024, the Company had no Federal net operating loss (“NOL”) carryforwards, including with the Arthrosurface asset group and a negligible amount of state net NOL carryforwards that will begin to expire in 2039.

The Company also had NOL carryforwards in Italy of $ 2.7 million that do not expire but are limited to 80% of taxable income.

As of December 31, 2024, the Company had no federal or state research and development tax credit carryforwards.

The Tax Cuts and Jobs Act (“TCJA”) requires taxpayers to capitalize and amortize research and experimental (“R&D”) starting in the year the year ended December 31, 2022.

The Company will amortize these costs for tax purposes over 5 years if the R&D was performed in the United States and over 15 years if the R&D was performed outside the U.S.

This change has resulted in the recognition of additional deferred tax assets and increased cash tax liabilities.

The One Big Beautiful Bill Act (the “OBBBA”), was enacted on July 4, 2025, among other things, repealed the mandatory capitalization of Internal Revenue Code Section 174 research and development expenditures allowing taxpayers to fully expense qualifying costs in the year incurred.

The Company does not expect to accelerate the write-off of previously capitalized research and development costs.

This approach results in a more consistent pattern of deductions and moderates the creation of additional tax attributes.

The OBBBA did not otherwise have a material impact on the Company’s consolidated financial statements.

As of December 31, 2025, the Company had $ 53.7 million and $ 34.5 million of Federal and State net operating loss (“NOL”) carryforwards, of which $ 53.7 million and $ 11.6 million, respectively, do not expire and $ 22.9 million of State net operating losses that will begin expiring in 2036.

The Company also had NOL carryforwards in Italy of $ 1.6 million that do not expire.

As of December 31, 2025, the Company had $ 0.4 million of Federal research and development credits and $ 0.2 million of State credits that begin expiring in 2028.

The Company recognizes deferred tax assets to the extent that it believes that these assets are more likely than not to be realized.

2 unchanged sentences

The Company recorded a full valuation allowance on all deferred tax assets in the U.S.

as it was determined they are more likely than not to be realizable as of both December 31, 2024 and December 31, 2023.

as it was determined that it is more likely than not that these deferred tax assets were not realizable as of December 31, 2025 and 2024.

The Company intends to maintain a full valuation allowance until there is sufficient evidence to support release of all or a portion of the allowance.

5 unchanged sentences

Effective Tax Rate

During the year ended December 31, 2025, the Company adopted Accounting Standards Update 2023-09, Improvements to Income Tax Disclosures, ( “ ASU 2023-09 ” ) .

ASU 2023-09 requires additional disclosures for income tax reporting, primarily related to a requirement for companies to disaggregate their income tax rate reconciliation.

The Company adopted ASU 2023-09 on a prospective basis and a tabular income tax rate reconciliation pursuant to the disclosure requirements of ASU 2023-09 for the year ended December 31, 2025 is as follows:

Year ended December 31, 2025

Statutory federal income tax rate

State tax expense, net of federal provision**

Foreign tax effects:

Other foreign jurisdictions

Effect of cross-border tax laws:

Global intangible low-taxed income, net

Research and development tax credits

Change in valuation allowance

Nontaxable or nondeductible items:

Stock-based compensation

Section 162(m) limitation

Other reconciling items:

Return to provision adjustments

Effective income tax rate

**State taxes in Indiana, Massachusetts and Kentucky made up the majority (greater than 50 percent) of the tax effect in this category.

The reconciliation between the U.S.

federal statutory rate and the Company’s effective rate is summarized as follows:

federal statutory rate and the Company’s effective rate for the years ended December 31, 2024 and 2023 is summarized as follows:

Years ended December 31,

1 unchanged sentence

State tax expense, net of federal benefit

Stock compensation

Stock-based compensation

Section 162(m) limitation

1 unchanged sentence

Federal, state and foreign tax credits

Valuation allowance

Change in valuation allowance

Return to provision adjustments

1 unchanged sentence

Effective income tax rate

Income Tax Payments

A summary of income taxes paid, net of refunds, by jurisdiction pursuant to the disclosure requirements of ASU 2023-09 for the year ended December 31, 2025 is as follows:

Year ended December 31,

United States - Federal

United States – State and local

United Kingdom

Accounting for Uncertainty in Income Taxes

The Company has $ 0.6 million and $0 of unrecognized tax benefits for the years ended December 31, 2024 and 2023, respectively.

The Company does not anticipate experiencing any significant increase or decrease in its unrecognized tax benefits within the twelve months following December 31, 2024.

The Company has $ 0.3 million and $ 0.6 million of unrecognized tax benefits for the years ended December 31, 2025 and 2024, respectively.

The Company files income tax returns in the United States on a federal basis, in certain U.S.

2 unchanged sentences

With a few exceptions, the Company is no longer subject to income tax examinations for years prior to 2021 .

In September 2024, the Company was notified by the Italian tax authorities that it had selected the Company’s tax returns for its Italian subsidiary for 2021 for examination and they remain under review.

In September 2024, the Company was notified by the Italian tax authorities that it had selected the Company’s tax returns for its Italian subsidiary for 2021 for examination.

The examination was completed in the quarter ended December 31, 2025 and the Company paid $ 0.4 million in income taxes which reduced the unrecognized tax benefit by $ 0.2 million during the year ended December 31, 2025.

Earnings per Share ( “ EPS ” )

2 unchanged sentences

Diluted EPS is calculated by dividing net income by the weighted average number of shares outstanding plus the dilutive effect, if any, of outstanding share-based awards using the treasury stock method.

The following table provides share information used in the calculation of the Company's basic and diluted EPS (in thousands):

Years Ended December 31,

Shares used in the calculation of basic EPS

Effect of dilutive securities:

Share based awards

Diluted shares used in the calculation of EPS

Due to the Company’s loss position, the share-based payment awards are anti-dilutive.

The Company was in a loss position during the years ended December 31, 2025, 2024 and 2023, therefore all potential common shares would have been anti-dilutive and accordingly were excluded from the computation of diluted EPS.

4 unchanged sentences

The CODM’s financial review is focused on the consolidated financial results of the Company which is used as the basis for financial performance assessment and allocation of resources.

The Company has determined that it only has one operating segment and is managed on a consolidated basis, the measure of profit or loss is consolidated net income or loss.

The following table presents selected financial information with respect to the Company’s single operating segment for the years ended December 31, 2025, 2024 and 2023 (in thousands):

6 unchanged sentences

(Loss) income from operations

Interest and other income (expense), net

Interest and other income, net

(Loss) income before income taxes

Provision for (benefit from) for income taxes

(Loss) income from continuing operations

Provision for income taxes

Loss from continuing operations

Loss from discontinued operations

3 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data