What changed in this filing

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Item 1A. Risk Factors

2025-02-14 compared with 2024-02-16 · 61 added, 87 removed, 433 unchanged (25% of the section changed)

14 unchanged sentences

• A prolonged downturn in macroeconomic conditions may materially adversely affect our business.

• Rising healthcare costs may result in efforts by government and private payors to contain or reduce healthcare spending, including reimbursement for procedures that utilize our products.

• Government and private payors may contain or reduce healthcare spending, including reimbursement for procedures that utilize our products.

• Adverse changes in governmental and third-party payors’ policies toward coverage and reimbursement for surgical procedures would harm our ability to promote and sell our products.

Operational Risks

• Unfavorable publicity relating to our business or industry could negatively impact our operations.

• Unfavorable publicity relating to our business or industry could negatively impact our operations or stock price.

• Reliance upon single and limited source third-party suppliers and service providers could harm our business if such third parties cannot provide materials or products or perform services for us in a timely manner.

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• We may be subject to fines, injunctions and penalties if we fail to comply with extensive FDA regulations.

• Unless and until we obtain additional FDA approval for our products, we will not be able to promote them for treatment of Afib and/or to prevent stroke, and our inability to maintain or grow our business could be harmed.

• Unless and until we obtain additional FDA approval for our products, we will not be able to promote them for treatment of Afib, prevention of stroke, or reduction of post-operative Afib, and our inability to maintain or grow our business could be harmed.

We may be subject to fines, injunctions and penalties if we are found to be promoting our products for unapproved or off-label uses.

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• If we or our third-party vendors fail to comply with extensive FDA regulations relating to the manufacturing of our products, we may be subject to fines, injunctions and penalties.

• Any adverse finding, judgement, settlement or enforcement action against us as a result of the current qui tam lawsuit could negatively affect our business.

• The use of products we sell may result in injuries or other adverse events that lead to product liability claims.

3 unchanged sentences

• Any allegation or determination of wrongdoing under the Foreign Corrupt Practices Act or other anti-corruption laws could have a material adverse effect on our business.

• Compliance with European Union medical device regulation may limit our ability to sell our products in European markets.

• The use of artificial intelligence technology by our employees or business partners could result in misuse or loss of proprietary information, violation of laws and regulations, or damage to our reputation and credibility.

Financial Risks

1 unchanged sentence

• We have a history of net losses, and we may never become profitable.

• Governmental authorities may question our intercompany transfer pricing policies or change their laws in a manner that could increase our effective tax rate.

• Governmental authorities may challenge our intercompany transfer pricing policies or change their laws in a manner that could increase our effective tax rate.

• Our goodwill may become impaired which could adversely affect our financial performance.

13 unchanged sentences

Our success depends in large part on the medical community’s acceptance of our products in the United States, which is the largest revenue market in the world for medical devices.

Our ablation and LAAM product sales in the United States generate the majority of our revenue.

We expect that sales of these products will continue to account for a majority of our revenue for the foreseeable future and that our future revenue will depend on the increasing acceptance by the medical community of our products as standard of care for treating Afib, managing the LAA and managing pain with Cryo Nerve Block therapy.

medical community’s acceptance of our products will depend upon our ability to demonstrate the safety and efficacy, advantages, long-term clinical performance and cost-effectiveness of our products.

We expect that sales of our ablation and LAAM products will continue to account for a majority of our revenue for the foreseeable future and that our future revenue will depend on the increasing acceptance by the medical community of our products as standard of care for treating Afib, managing the LAA and managing post-operative pain with Cryo Nerve Block therapy.

medical community’s acceptance of our products will depend upon our ability to demonstrate the safety and efficacy, advantages, short and long-term clinical performance and cost-effectiveness of our products.

In addition, acceptance of products for the treatment of Afib is dependent upon, among other factors, the level of awareness and education of the medical community about the surgical treatment of Afib and the existence, effectiveness and safety of our products.

1 unchanged sentence

Negative publicity resulting from incidents involving our products, or similar products could have a significant adverse effect on the overall acceptance of our products.

If we encounter difficulties growing the market for our products in the U.S., we may not be able to increase our revenue enough to achieve or sustain profitability, and our business and operating results will be seriously harmed.

If we encounter difficulties growing the market for our products in the United States, we may not be able to increase our revenue enough to achieve or sustain profitability, and our business and operating results will be seriously harmed.

Competition from existing and new products and procedures may decrease our market share and may cause our revenue to decline, and could adversely affect our operating results.

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Most of our competitors and potential competitors have greater financial, manufacturing, marketing and research and development capabilities than we have, and may obtain FDA approval or clearance for their products.

In 2023, Medtronic announced the FDA clearance of the Penditure TM Left Atrial Appendage Exclusion System.

The introduction of new products, procedures or clinical solutions, or our competitors obtaining FDA approvals or clearances, such as Medtronic's Penditure device, may result in price reductions, reduced margins, loss of market share, or may render our products obsolete, which could adversely affect our revenue and future profitability.

The introduction of new products, procedures or clinical solutions, or our competitors obtaining FDA approvals or clearances, may result in price reductions, reduced margins, loss of market share, or may render our products obsolete, which could adversely affect our revenue and future profitability.

Any clinical data that is generated regarding our products may not be positive, and our current and planned clinical trials may not satisfy the requirements of the FDA or other regulatory authorities.

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Our products will be measured on their efficacy.

We cannot provide any assurance that the data collected during our clinical trials will be compelling to the medical community because it may not be scientifically meaningful, may identify unexpected safety concerns, and may not demonstrate that procedures utilizing our products are an attractive option when

compared against data from alternative procedures and products.

Negative data could affect the use of our products and harm our business and prospects.

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There can be no assurance that the results of studies conducted by collaborators or other third parties will be viewed favorably or are indicative of our own future study results.

We may be required to demonstrate with substantial evidence through well-controlled clinical trials that our product candidates are either (i) safe and effective for use in a diverse population for their intended uses or (ii) are substantially equivalent to predicate devices under section 510(k) of the Food, Drug and Cosmetic Act (FDCA).

Success in early clinical trials does not mean that future clinical trials will be successful because product candidates in later-stage clinical trials may fail to demonstrate sufficient safety and efficacy to the satisfaction of the FDA and other regulatory authorities despite having progressed through initial clinical trials.

We may be required to demonstrate with substantial evidence through well-controlled clinical trials that our products are either (i) safe and effective for use in a diverse population for their intended uses or (ii) are substantially equivalent to predicate devices under section 510(k) of the Food, Drug and Cosmetic Act (FDCA).

Success in early clinical trials does not mean that future clinical trials will be successful because products in later-stage clinical trials may fail to demonstrate sufficient safety and efficacy to the satisfaction of the FDA and other regulatory authorities despite having progressed through initial clinical trials.

Our devices and products may not be approved or cleared even though clinical or other data, in our view, are adequate to support an approval or clearance.

1 unchanged sentence

• disagree with our trial design and our interpretation of data from preclinical studies and clinical trials;

• change requirements for the approval or clearance of a product candidate even after reviewing and providing comment on a protocol for a pivotal clinical trial;

• approve or clear a product candidate for fewer or more limited indications or uses than we request;

• change requirements for the approval or clearance of a product even after reviewing and providing comment on a protocol for a pivotal clinical trial;

• approve or clear a product for fewer or more limited indications or uses than we request;

• grant approval or clearance contingent on the performance of costly post-marketing clinical trials;

• not approve the labeling claims necessary or desirable for the successful commercialization of our product candidates.

• not approve the labeling claims necessary or desirable for the successful commercialization of our products.

These factors would affect the rate and extent to which our products are adopted in the medical community.

1 unchanged sentence

We depend on independent third-party distributors to sell our products in certain markets outside of the United States, and if these distributors do not perform, we may be unable to maintain or increase international revenue.

We intend to grow our business outside of the United States, and to do so, we will need to attract additional distributors or hire direct sales personnel to expand the territories in which we sell our products.

We intend to grow our business outside of the United States, and to do so, we may need to attract additional distributors or hire direct sales personnel to expand the territories in which we sell our products.

Independent distributors may terminate their relationship with us or devote insufficient sales efforts to our products.

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The ability of these independent distributors to market and sell our products could also be adversely affected by unexpected events, including, but not limited to, power failures, nuclear events, local economic and political conditions, natural or other disasters and war or terrorist activities.

In addition, the ability of our independent distributors to borrow money from their existing lenders or to obtain credit from other sources to purchase our products may be impaired or our independent distributors could experience a significant change in their liquidity or financial condition, all of which could impair their ability to distribute our products and eventually lead to distributor turnover, and may adversely impact our sales.

In addition, the ability of our independent distributors to obtain financing to purchase our products may be impaired or our independent distributors could experience a significant change in their liquidity or financial condition, all of which could impair their ability to distribute our products and eventually lead to distributor turnover, and may adversely impact our sales.

Industry Conditions Risks

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Geopolitical issues around the world have impacted the global supply chain and could materially adversely affect global economic growth, disrupt discretionary spending habits and generally decrease demand for our products and services.

Our customers’ ability to borrow money from their existing lenders or to obtain credit from other sources to purchase our products may be impaired,

resulting in a decrease in sales.

Our customers’ ability to borrow money from their existing lenders or to obtain credit from other sources to purchase our products may be impaired, resulting in a decrease in sales.

We may experience diversion of healthcare resources away from the conduct of clinical trials, including the diversion of hospitals serving as our clinical trial sites.

We may also encounter interruption or delays in the operations of FDA or other regulatory authorities, which may impact review and approval timelines.

We may also encounter interruption or delays in

the operations of FDA or other regulatory authorities, which may impact review and approval timelines.

We are unable to predict the extent to which current or future worldwide economic conditions may impact our business.

Healthcare costs have risen significantly over the past decade.

There have been and may continue to be proposals by legislators, regulators and third-party payors to keep, contain or reduce healthcare costs.

There have been and may continue to be proposals by legislators, regulators and third-party payors to contain or reduce healthcare costs.

The continuing efforts of governments, insurance companies and other payors of healthcare costs to contain or reduce these costs, combined with closer scrutiny of such costs, could lead to patients being unable to obtain approval for payment from these third-party payors.

The cost containment measures that healthcare providers are instituting both in the U.S.

and internationally could harm our business.

Some healthcare providers in the U.S.

have adopted or are considering a managed care system in which the providers contract to provide comprehensive healthcare for a fixed cost per person.

The cost containment measures that healthcare providers are instituting both in the United States and internationally could harm our business.

Some healthcare providers in the United States have adopted or are considering a managed care system in which the providers contract to provide comprehensive healthcare for a fixed cost per person.

Healthcare providers may attempt to control costs by authorizing fewer elective surgical procedures, eliminating incremental procedure costs or by requiring the use of the least expensive devices possible, which could adversely affect the demand for our products or the price at which we can sell our products.

1 unchanged sentence

As the healthcare industry consolidates, competition to provide products and services has become and will continue to become more intense.

This has resulted and likely will continue to result in greater pricing pressures and the exclusion of certain suppliers from important marketing segments.

This has resulted and likely will continue to result in greater pricing pressures and the exclusion of certain suppliers from important market segments.

Adverse changes in governmental and third-party payors’ policies toward coverage and reimbursement for surgical procedures would harm our ability to promote and sell our products.

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FDA does not regulate the practice of medicine.

Physicians may use our products in circumstances where they deem it medically appropriate, such as for the treatment of Afib or the reduction in stroke risk, even though FDA may not have approved or cleared our products to be marketed specifically for those indications.

Physicians may use our products in circumstances where they deem it medically appropriate, such as for the treatment Afib, prevention of stroke, or reduction of post-operative Afib, even though FDA may not have approved or cleared our products to be marketed specifically for those indications.

Some payors may deny coverage or payment for the use of our products for indications not specifically approved or cleared by FDA.

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We may experience a negative impact on our business from newspaper articles or other media reports relating to, among other things, our compliance with FDA regulations for medical device reporting, adverse patient and clinical outcomes, potential impact to our business from competitors or emerging technology and concerns over disclosure of financial relationships between us and our consultants.

We believe that such publicity would potentially have a negative

impact on our business, results of operations and financial condition and our clinical studies, or cause other adverse effects, including a decline in the price of our stock.

We believe that such publicity would potentially have a negative impact on our business, results of operations and financial condition and our clinical studies, or cause other adverse effects, including a decline in the price of our stock.

We rely upon single and limited source third-party suppliers and third-party service providers, making us vulnerable to supply problems and price fluctuations which could harm our business.

We rely on single and limited source third-party vendors for the manufacture and sterilization of components used in our products.

For example, we rely on one vendor to manufacture our RF generator, as well as separate vendors to manufacture our EPi-Sense System and related RF generator.

It would be a time consuming and lengthy process to secure these products from an alternative supplier.

We rely on single and limited source third-party vendors for the manufacture and sterilization of components used in our products as well as third-party vendors for the manufacturing of our RF generator and our EPi-Sense System.

We have significant concentrations with a limited number of vendors.

It would be a time consuming and lengthy process to secure these products from an alternative supplier.

Additionally, our devices are sterilized prior to use using ethylene oxide at third-party sterilizers.

Recently, certain sterilization facilities have experienced mandated temporary closures due to concerns over the impact of emissions of ethylene oxide from such facilities, and the Environmental Protection Agency has proposed regulations aimed at reducing hazardous air pollutants.

Recently, certain sterilization facilities have experienced voluntary or mandated temporary closures due to concerns over the impact of emissions of ethylene oxide from such facilities, and the Environmental Protection Agency has proposed regulations aimed at reducing hazardous air pollutants.

We also rely on third parties to handle our warehousing and logistics functions for European and several other international markets on our behalf.

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Our manufacturing operations are highly centralized to our corporate headquarters.

While we take precautions, such as qualifying a second building for manufacturing, we do not maintain a backup manufacturing facility outside of our Ohio campus, making us dependent on the current facilities and production workers for the continued operation of our business.

While we have taken precautions, such as qualifying a second building for manufacturing, we do not maintain a backup manufacturing facility outside of our Ohio campus, making us dependent on the current facilities and production workers for the continued operation of our business.

A natural or other disaster could damage or destroy our manufacturing equipment and cause substantial delays in our manufacturing operations, which could lead to additional expense and decreased revenue due to lack of supply.

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In the future, we may experience difficulties in increasing production, including problems with production yields and quality control, component supply and shortages of qualified personnel.

These problems could result in delays in product availability and increases in expenses.

These problems could result in delays in product

availability and increases in expenses.

Any such delay or increased expense could adversely affect our ability to generate revenues and adversely impact our operating results.

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We have cyber-insurance coverage that may not cover all possible events, and this insurance is subject to deductibles and coverage limitations.

additional regulatory scrutiny or penalties and to civil litigation and possible financial liability, any of which could have a material adverse effect on our business, operating margins, revenues and competitive position.

We could sustain damage to our reputation and customer and employee relationships, suffer disruptions to our business and incur increased operating costs including costs to mitigate any damage caused and protect against future damage, and be exposed to additional regulatory scrutiny or penalties and to civil litigation and possible financial liability, any of which could have a material adverse effect on our business, operating margins, revenues and competitive position.

We also rely in part on information technology to store information, interface with customers, maintain financial accuracy, secure our data and accurately produce our financial statements.

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We spend considerable time and money complying with federal, state and foreign regulations in addition to FDA regulations, and, if we do not fully comply with such regulations, we could face substantial penalties.

We are subject to extensive regulation by the federal government and foreign countries in which we conduct business.

We are subject to extensive regulations by the federal government and foreign countries in which we conduct business.

The laws that affect our ability to operate our business in addition to the FDCA and FDA regulations include, but are not limited to, the following:

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In addition, the number of medical device reports we make, or the magnitude of the problems reported, could cause us or FDA to terminate or modify our clinical trials or recall or cease the sale of our products, and could hurt commercial acceptance of our products and harm our reputation with customers.

Unless and until we obtain additional FDA approval for our products, we will not be able to promote them for the treatment of Afib and/or to prevent stroke, and our ability to maintain and grow our business could be harmed.

Unless and until we obtain additional FDA approval for our products, we will not be able to promote them for the treatment of Afib, prevention of stroke, or reduction of post-operative Afib, and our ability to maintain and grow our business could be harmed.

We may be subject to fines, penalties, injunctions and other sanctions if we are deemed to be promoting the use of our products for unapproved, or off-label, uses.

Our business and future growth depend on the continued use of our products for the treatment of Afib.

Unless the products are approved or cleared by FDA specifically for the treatment of Afib or prevention of stroke, we may not make claims about the safety or effectiveness of our products for such uses.

In order to obtain additional FDA approvals to promote our products for the treatment of Afib or reduction in stroke risk, we will need to demonstrate in clinical trials that our products are safe and effective for such use.

Our business and future growth depend on the continued use of our products for the treatment of Afib and/or reduction of Afib and related complications, such as stroke.

Unless the products are approved or cleared by FDA specifically for the treatment of Afib, prevention of stroke, or reduction of post-operative Afib, we may not make claims about the safety or effectiveness of our products for such uses.

In order to obtain additional FDA approvals to promote our products, we will need to demonstrate in clinical trials that our products are safe and effective for such use.

Development of sufficient and appropriate clinical protocols to demonstrate quality, safety and efficacy may be required and we may not adequately develop such protocols to support approval.

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There is also a possibility that we could be enjoined from selling some or all of our products for any unapproved use.

Although our Isolator Synergy System and EPi-Sense System have received FDA approval for the treatment of some forms of Afib in certain procedures, we have not received FDA clearance or approval to promote our other products for the treatment of Afib or the prevention of stroke.

Unless and until we obtain FDA clearance or approval for the use of our other products to treat Afib or prevent stroke, we, and others acting on our behalf, may not claim in the U.S.

that such products are safe and effective for such uses or otherwise promote them for such uses.

Similar restrictions also exist outside of the U.S.

Unless and until we obtain FDA clearance or approval for the use of our other products to treat Afib, prevent stroke, or reduce post-operative Afib, we, and others acting on our behalf, may not claim in the United States that such products are safe and effective for such uses or otherwise promote them for such uses.

Similar restrictions also exist outside of the United States.

There is no assurance that future clearances or approvals of our products will be granted or that current or future clearances or approvals will not be withdrawn.

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FDA may not agree with our decisions regarding whether submissions were required.

If FDA were to disagree with us and require us to submit a 510(k), PMA or a PMA supplement for then-existing modifications, we could be required to cease promoting or to recall the modified product until we obtain clearance or approval.

In addition, we could be subject to significant regulatory fines or other penalties.

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Interruption or delay in the manufacture of the product or any of its components could impair our ability to meet the demand of our customers and cause them to cancel orders or switch to competitive products and could, therefore, have a material adverse effect on our business, financial condition and results of operations.

We are currently defending against a lawsuit brought under the False Claims Act, and any adverse finding, judgement, or enforcement action could materially and adversely affect our business, financial condition or results of operations.

As previously disclosed, on December 11, 2017, the Company received a Civil Investigative Demand (CID) from the US Department of Justice (USDOJ) stating that it was investigating the Company to determine whether the Company has violated the False Claims Act, relating to the promotion of certain medical devices related to the treatment of atrial fibrillation for off-label use and submitted or caused to be submitted false claims to certain federal and state health care programs for medically unnecessary healthcare services related to the treatment of Afib.

The Company provided the USDOJ with documents and answers to the written interrogatories, and cooperated with the investigation.

In 2021, USDOJ informed the Company that the investigation resulted from a lawsuit by a private individual, or "relator", brought on behalf of the United States and various state and local governments under the qui tam provisions of the federal and similar state and local laws.

Although the USDOJ and all of the state and local governments declined to intervene, the relator continues to pursue the lawsuit.

During the third quarter of 2022, the relator filed a Fourth Amended Complaint, which dropped allegations of off-label promotion and now alleges that the Company paid illegal kickbacks to healthcare providers in exchange for using or referring the Company’s products, in violation of the federal Anti-Kickback Statute and various comparable state and local laws.

While the Company is contesting the case, it is not possible to predict when the lawsuit

will be resolved, the outcome of the lawsuit or its potential impact on the Company.

While the Company believes its practices are lawful, there can be no assurance that the lawsuit will not result in findings of violations of federal laws that could lead to the imposition of damages, fines, penalties, restitution, other monetary liabilities, sanctions, settlements or changes to the Company’s business practices or operations that could have a material adverse effect on the Company’s business, financial condition or results of operations, or eliminate altogether the Company’s ability to operate its business.

The use of products we sell may result in injuries or other adverse events that lead to product liability suits, which could be costly to our business or our customers’ businesses.

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For example, our operations outside of the United States are subject to different regulatory requirements in each jurisdiction where we operate or have sales.

Our failure, or the failure of our distributors, to comply with current or future foreign regulatory requirements, or the assertion by foreign authorities that we or our distributors have failed to comply, could result in adverse consequences, including enforcement actions, fines and penalties, recalls, cessation of sales, civil and criminal prosecution, and the consequences could be disproportionate to the relative contribution of our international operations to our results of operations.

Our failure, or the failure of our distributors, to comply with current or future

foreign regulatory requirements, or the assertion by foreign authorities that we or our distributors have failed to comply, could result in adverse consequences, including enforcement actions, fines and penalties, recalls, cessation of sales, civil and criminal prosecution, and the consequences could be disproportionate to the relative contribution of our international operations to our results of operations.

Moreover, if political or economic conditions deteriorate in these countries, or if any of these countries are affected by a natural disaster or other catastrophe, our ability to conduct our international operations or collect on international accounts receivable could be limited and our costs could be increased, which could negatively affect our operating results.

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or other governments may seek to hold us liable for successor liability FCPA violations or violations of other anti-corruption laws committed by companies in which we invest or that we acquired or will acquire.

Compliance with developing European Union medical device regulations may limit our ability to maintain sales of our products in European markets or to introduce new products into European markets.

Many foreign countries where we market or may market our products have regulatory bodies and restrictions similar to those of FDA.

International sales are subject to foreign government regulation, the requirements of which vary substantially from country to country.

The time required to obtain approval by a foreign country may be longer or shorter than that required for FDA clearance and the requirements may differ.

In particular, marketing of medical devices in the EU is subject to compliance with the Medical Device Directive 93/92/EEC (MDD).

A medical device may be placed on the market within the EU only if it conforms to certain “essential requirements” and bears the CE Mark.

The most fundamental and essential requirement is that a medical device must be designed and manufactured in such a way that it will not compromise the clinical condition or safety of patients, or the safety and health of users and others.

In addition, the device must achieve the essential performance intended by the manufacturer and be designed, manufactured and packaged in a suitable manner.

In May 2017, the EU adopted a new Medical Device Regulation (EU) 2017/745 (MDR), which repealed and replaced the MDD effective May 26, 2021.

The MDR clearly envisages, among other things, stricter controls of medical devices, including strengthening of the conformity assessment procedures, increased expectations with respect to clinical data for devices and pre-market regulatory review of high-risk devices.

The MDR also envisages greater control over notified bodies and their standards, increased transparency, more robust device vigilance requirements and clarification of the rules for clinical investigations.

Under transitional provisions, medical devices with notified body certificates issued under the MDD prior to May 26, 2021, may continue to be placed on the market until 2027 or 2028, depending on device classification, as long as those devices meet the requirements of 2017/745 as amended by EU 2023/607.

After the expiry of any applicable transitional period, only devices that have been CE marked under the MDR may be placed on the market in the EU.

If we fail to comply with the new MDR, we may not be able to continue to sell existing products in the EU or introduce new products for sale in the EU, either of which could materially harm our results of operations and financial condition.

The use of artificial intelligence ("AI") technology by our employees or business partners could result in misuse or loss of proprietary information, violation of laws and regulations, or damage to our reputation and credibility.

Our employees and business partners may use AI technology to perform their work.

Our sensitive information could be leaked, disclosed, or revealed as a result of or in connection with use of AI technology.

Additionally, the use and disclosure of personal data in AI technology is subject to various data privacy laws and other data privacy obligations.

Governments have passed and are likely to pass additional laws regulating AI.

Our use of this technology could result in additional compliance costs, regulatory investigations and actions and lawsuits.

Further, the cost to comply with such laws or regulations, or decisions and/or guidance interpreting existing laws, could be significant and would increase our operating expenses, which could adversely affect our business, financial condition and results of operations.

Financial Risks

Our quarterly financial results are likely to fluctuate significantly because the pace of adoption of our products by clinicians are uncertain.

Our quarterly financial results are likely to fluctuate significantly because the pace of adoption of our products by clinicians is uncertain.

Due to differing rates of adoption of our devices, our quarterly operating results may fluctuate significantly.

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We have a history of net losses, and we may never become profitable.

Even though we reported net income of $50,199 in 2021, we have a history of net losses, including net losses of $30,438 in 2023, and $46,466 in 2022.

We have a history of net losses, including $44,698 in 2024, $30,438 in 2023, and $46,466 in 2022.

As of December 31, 2024, we had an accumulated deficit of $401,755.

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Our losses have had, and are expected to continue to have, an adverse impact on our working capital, total assets and accumulated deficit.

Governmental authorities may question our intercompany transfer pricing policies or change their laws in a manner that could increase our effective tax rate or otherwise harm our business.

Governmental authorities may challenge our intercompany transfer pricing policies or change their laws in a manner that could increase our effective tax rate or otherwise harm our business.

company doing business in international markets through subsidiaries, we are subject to foreign tax and intercompany transfer pricing laws, including those relating to the flow of funds between the parent and subsidiaries.

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We may have future impairment adjustments to our recorded goodwill.

Any finding that the value of our goodwill has been impaired would require us to record an impairment charge which could materially reduce the value of our assets and reduce our net income or increase our net loss for the year in which the impairment charge occurs and increase our accumulated deficit.

Any finding that the value of our goodwill has been impaired would require us to record an impairment charge which could

materially reduce the value of our assets and reduce our net income or increase our net loss for the year in which the impairment charge occurs and increase our accumulated deficit.

An inability to forecast future revenue or estimate life cycles of products may result in inventory-related charges that would negatively affect our gross margins and results of operations.

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As we grow and expand our product offerings, managing our inventory levels becomes more difficult, particularly as we expand into new product areas and bring product enhancements to market.

While we rely on our personnel and information technology systems for inventory management, our personnel and

information technology systems may fail to adequately perform these functions or may experience an interruption.

While we rely on our personnel and information technology systems for inventory management, our personnel and information technology systems may fail to adequately perform these functions or may experience an interruption.

An excessive amount of inventory reduces our cash available for operations and may result in excess or obsolete materials.

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Our accounts receivable outside the United States are primarily due from public and private hospitals and from independent distributors.

Our historical write-offs of accounts receivable have not been significant.

We monitor the financial performance and credit worthiness of our customers so that we can properly assess and respond to changes in their credit profile.

Although our historical write-offs of accounts receivable have not been significant, we monitor the financial performance and credit worthiness of our customers so that we can properly assess and respond to changes in their credit profile.

Our independent distributors operate in certain countries where economic conditions continue to present challenges to their businesses, and, thus, could place the amounts due to us at risk.

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If sufficient securities analysts do not cover our common stock, the lack of research coverage may adversely affect the market price of our common stock.

It may be difficult for companies such as ours, with a smaller market capitalization, to attract and

maintain sufficient independent financial analysts that will cover our common stock.

It may be difficult for companies such as ours, with a smaller market capitalization, to attract and maintain sufficient independent financial analysts that will cover our common stock.

This could have a negative effect on the market price of our stock.

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This volatility has often been unrelated to the operating performance of these particular companies.

In the past, companies that experience volatility in the market price of their securities have often faced securities class action litigation.

In the past, companies that experienced volatility in the market price of their securities have often faced securities class action litigation.

Whether or not meritorious, litigation brought against us could result in substantial costs, divert our management’s attention and resources and harm our ability to grow our business.

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Provisions in our certificate of incorporation and bylaws could delay or prevent a change of control or change in management that would provide a premium to the market price of common stock.

These provisions include those:

These provisions include the following:

• authorizing the issuance without further approval of “blank check” preferred stock that could be issued by our board of directors to increase the number of outstanding shares and thwart a takeover attempt;

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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 1A. Risk Factors