What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-03-11 compared with 2024-03-12 · 401 added, 558 removed, 984 unchanged (49% of the section changed)

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Report of Independent Registered Public Accounting Firm (PCAOB ID Number 248 )

Consolidated Statements of Operations and Comprehensive (Loss) Income

Consolidated Statements of Operations and Comprehensive L oss

Consolidated Balance Sheets

Consolidated Statements of Changes in Stockholders’ and Members’ Equity

Consolidated Statements of Changes in Stockholders’ Equity

Consolidated Statements of Cash Flows

Notes to the Consolidated Financial Statements

Significant accounting policies

Balance sheet information

Acquisitions and divestitures

Financial instruments

Fair value measurements

Equity-based compensation

Stockholders’ equity

Earnings per share

Restructuring costs

Commitments and contingencies

Revenue recognition

Discontinued operations

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors and Shareholders

Bioventus Inc.

Opinion on the financial statements

We have audited the accompanying consolidated balance sheets of Bioventus Inc.

(a Delaware corporation) and subsidiaries (the “Company”) as of December 31, 2023 and 2022, the related consolidated statements of operations and comprehensive (loss) income, changes in stockholders’ and members’ equity, and cash flows for each of the three years in the period ended December 31, 2023, and the related notes (collectively referred to as the “financial statements”).

(a Delaware corporation) and subsidiaries (the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of operations and comprehensive loss, changes in stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2024, and the related notes collectively referred to as the financial statements.

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

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Bioventus Inc.

Consolidated Statements of Operations and Comprehensive (Loss) Income

Consolidated Statements of Operations and Comprehensive Loss

Years Ended December 31, 2024, 2023 and 2022

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Loss on disposals 292 3,577 —

Impairment of variable interest entity assets — — 5,674

Operating (loss) income ( 81,725 ) ( 167,234 ) 12,061

Operating loss ( 11,979 ) ( 81,725 ) ( 167,234 )

Interest expense, net 38,792 40,676 12,021

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Other expense 37,147 39,386 21,791

(Loss) income before income taxes ( 121,111 ) ( 189,025 ) 9,488

Income tax expense (benefit), net 85 ( 44,374 ) ( 1,966 )

Net (loss) income from continuing operations ( 121,196 ) ( 144,651 ) 11,454

Loss before income taxes ( 49,126 ) ( 121,111 ) ( 189,025 )

Income tax (benefit) expense, net ( 5,293 ) 85 ( 44,374 )

Net loss from continuing operations ( 43,833 ) ( 121,196 ) ( 144,651 )

Loss from discontinued operations, net of tax — ( 74,429 ) ( 68,740 )

Net (loss) income ( 195,625 ) ( 213,391 ) 9,586

Net loss ( 43,833 ) ( 195,625 ) ( 213,391 )

Loss attributable to noncontrolling interest - continuing operations 10,291 24,458 40,732

Loss attributable to noncontrolling interest - discontinued operations — 14,937 13,955

Net (loss) income attributable to Bioventus Inc.

Net loss attributable to Bioventus Inc.

$ ( 33,542 ) $ ( 156,230 ) $ ( 158,704 )

Net (loss) income $ ( 195,625 ) $ ( 213,391 ) $ 9,586

Other comprehensive (loss) income, net of tax

Change in prior service cost and unrecognized (loss) gain

Net loss $ ( 43,833 ) $ ( 195,625 ) $ ( 213,391 )

Other comprehensive loss, net of tax

Change in prior service cost and unrecognized gain (loss)

for defined benefit plan adjustment 13 ( 8 ) 133

Change in foreign currency translation adjustments ( 4,194 ) 1,140 ( 501 )

Comprehensive (loss) income ( 194,493 ) ( 213,759 ) 8,328

Comprehensive loss ( 48,014 ) ( 194,493 ) ( 213,759 )

Comprehensive loss attributable to noncontrolling interest - continuing operations 11,105 24,230 40,811

Comprehensive loss attributable to noncontrolling interest - discontinued operations — 14,937 13,955

Comprehensive (loss) income attributable to Bioventus Inc.

Comprehensive loss attributable to Bioventus Inc.

$ ( 36,909 ) $ ( 155,326 ) $ ( 158,993 )

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64,547,474 62,647,554 61,389,107

(1) Per share information for the year ended December 31, 2021 represents loss per share of Class A common stock and weighted-average shares of Class A common stock outstanding from February 16, 2021 through December 31, 2021, the period following Bioventus Inc.'s initial public offering and related transactions described in Note 8.

Stockholders’ equity and Note 9.

Earnings per share within the Notes to the Consolidated Financial Statements.

The accompanying notes are an integral part of these consolidated financial statements.

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Prepaid and other current assets 14,160 16,913

Current assets attributable to discontinued operations — 2,777

Total current assets 275,610 267,999

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Operating lease assets 6,506 13,353

Deferred tax assets 4,745 —

Investment and other assets 1,892 3,141

Long-term assets attributable to discontinued operations — 405,994

Total assets $ 727,956 $ 810,910

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Current portion of long-term debt 27,339 27,848

Current portion of contingent consideration 19,573 —

Other current liabilities 3,917 4,816

Current liabilities attributable to discontinued operations — 119,087

Total current liabilities 210,398 175,497

Long-term debt, less current portion 308,288 366,998

Deferred income taxes 1,213 2,248

Deferred income tax liabilities 564 1,213

Contingent consideration — 18,150

Other long-term liabilities 23,102 27,934

Long-term liabilities attributable to discontinued operations — 228,911

Total liabilities 542,352 589,792

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Accumulated deficit ( 355,078 ) ( 321,536 )

Accumulated other comprehensive income (loss) 794 ( 110 )

Accumulated other comprehensive (loss) income ( 2,573 ) 794

Total stockholders’ equity attributable to Bioventus Inc.

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Bioventus Inc.

Consolidated Statements of Changes in Stockholders’ and Members’ Equity

Consolidated Statements of Changes in Stockholders’ Equity

Years Ended December 31, 2024, 2023 and 2022

(Amounts in thousands, except share amounts)

Equity Class A Common Stock Class B Common Stock Additional Paid-in Capital Accumulated other comprehensive income (loss) Accumulated Deficit Non-

Interest Total Stockholders' and

Class A Common Stock Class B Common Stock Additional Paid-in Capital Accumulated other comprehensive income (loss) Accumulated Deficit Non-

Interest Total Stockholders’

Shares Amount Shares Amount

December 31, 2021 59,548,504 $ 59 15,786,737 $ 16 $ 473,318 $ 179 $ ( 6,602 ) $ 140,686 $ 607,656

Prior to Organizational Transactions:

Refund from members 123 — — — — — — — — 123

Equity-based compensation ( 39 ) — — — — — — — — ( 39 )

Net income 25,977 — — — — — — — — 25,977

Other comprehensive loss ( 1,507 ) — — — — — — — — ( 1,507 )

Effect of Organizational Transactions ( 168,714 ) 31,838,589 32 15,786,737 16 41,813 — — 79,119 ( 47,734 )

Subsequent to Organizational Transactions:

Initial public offering, net of offering costs — 9,200,000 9 — — 106,441 — — — 106,450

Issuance of Class A common stock for equity plans 2,514,510 3 — — 5,819 — — — 5,822

Issuance of Class A common stock for acquisitions, net of registration fees — 18,340,790 18 — — 272,706 — — — 272,724

Distribution to Continuing LLC Owner — — — — — — — — ( 3,306 ) ( 3,306 )

Net loss — — — — — — — ( 6,602 ) ( 9,789 ) ( 16,391 )

Deconsolidation of variable interest entity — — — — — — — — 3,746 3,746

Equity based compensation — — — — — 15,059 — — 4,825 19,884

Replacement equity awards in connection with acquisitions — — — — — 27,636 — — — 27,636

Acquisition of noncontrolling interest — — — — — — — — 200 200

Change in noncontrolling interest allocations — — — — — 8,046 — — 65,821 73,867

Other comprehensive income — — — — — — 179 — 70 249

December 31, 2021 $ — 59,548,504 $ 59 15,786,737 $ 16 $ 473,318 $ 179 $ ( 6,602 ) $ 140,686 $ 607,656

Issuance of Class A common stock for equity plans 2,514,510 3 — — 5,819 — — — 5,822

Deferred taxes on equity rebalancing — — — — ( 1,977 ) — — — ( 1,977 )

Net loss — — — — — — ( 158,704 ) ( 54,687 ) ( 213,391 )

Tax withholdings on equity compensation awards — — — — ( 3,352 ) — — — ( 3,352 )

Tax withholdings on equity-based compensation awards — — — — ( 3,352 ) — — — ( 3,352 )

Deconsolidation of noncontrolling interest — — — — — — — 247 247

Equity-based compensation — — — — 14,180 — — 3,405 17,585

Change in noncontrolling interest allocations — — — — 2,588 — — ( 2,588 ) —

Change in noncontrolling interest allocation — — — — 2,588 — — ( 2,588 ) —

Other comprehensive loss — — — — — ( 289 ) — ( 79 ) ( 368 )

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Equity-based compensation — — — — 2,388 — — 334 2,722

Change in noncontrolling interest allocations — — — — 513 — — ( 513 ) —

Change in noncontrolling interest allocation — — — — 513 — — ( 513 ) —

Distributions to members — — — — — — — ( 111 ) ( 111 )

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December 31, 2023 63,267,436 $ 63 15,786,737 $ 16 $ 494,254 $ 794 $ ( 321,536 ) $ 47,527 $ 221,118

Issuance of Class A common stock for equity plans 2,490,905 3 — — 2,439 — — — 2,442

Net loss — — — — — — ( 33,542 ) ( 10,291 ) ( 43,833 )

Equity-based compensation — — — — 8,321 — — 1,737 10,058

Change in noncontrolling interest allocations — — — — 495 — — ( 495 ) —

Other comprehensive loss — — — — — ( 3,367 ) — ( 814 ) ( 4,181 )

December 31, 2024 65,758,341 $ 66 15,786,737 $ 16 $ 505,509 $ ( 2,573 ) $ ( 355,078 ) $ 37,664 $ 185,604

The accompanying notes are an integral part of these consolidated financial statements .

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Operating activities:

Net (loss) income $ ( 195,625 ) $ ( 213,391 ) $ 9,586

Net loss $ ( 43,833 ) $ ( 195,625 ) $ ( 213,391 )

Loss from discontinued operations, net of tax — ( 74,429 ) ( 68,740 )

(Loss) income from continuing operations ( 121,196 ) ( 144,651 ) 11,454

Adjustments to reconcile net (loss) income to net cash from operating activities:

Loss from continuing operations ( 43,833 ) ( 121,196 ) ( 144,651 )

Adjustments to reconcile net loss to net cash from operating activities:

Depreciation and amortization 49,555 57,365 55,398

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Equity-based compensation from 2021 Stock Incentive Plan 10,058 2,722 17,585

Profits interest plan, liability-classified and other equity awards compensation — — ( 24,356 )

Change in fair value of contingent consideration 1,423 719 1,102

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Deferred income taxes ( 5,394 ) ( 2,377 ) ( 46,658 )

Change in fair value of Equity Participation Rights — — ( 2,774 )

Impairments of assets 36,357 78,615 134,982

Loss on debt retirement and modification — — 2,162

Loss on disposals 292 3,577 —

Unrealized loss (gain) on foreign currency fluctuations 665 1,383 472

Unrealized (gain) loss on foreign currency fluctuations ( 259 ) 665 1,383

Other, net 2,810 1,707 388

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Investing activities:

Acquisitions, net of cash acquired — — ( 262,870 )

Proceeds from sale of a business 24,678 34,675 —

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Financing activities:

Proceeds from issuance of Class A common stock sold in initial public offering,

net of underwriting discounts and offering costs — — 107,777

Proceeds from issuance of Class A and B common stock 2,442 778 5,822

Registration fees for Class A common stock to purchase Misonix — — ( 1,838 )

Tax withholdings on equity-based compensation — — ( 3,352 )

Receipt of deferred consideration 4,500 — —

Borrowing on revolver — 64,000 25,000

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As a result, the Company consolidates the financial results of BV LLC and reports a noncontrolling interest representing the interest of BV LLC held by its continuing LLC owner.

The Company is focused on developing and commercializing clinically differentiated, cost efficient and minimally invasive treatments that engage and enhance the body’s natural healing processes.

The Company is headquartered in Durham, North Carolina and has approximately 970 employees at December 31, 2023.

The Company is focused on helping patients recover and live life to the fullest by relieving pain and addressing musculoskeletal challenges through a diverse portfolio of high-quality, innovative and clinically-proven solutions.

The Company is headquartered in Durham, North Carolina and had approximately 930 employees at December 31, 2024.

Interim periods

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Each quarter ends on the Saturday closest to calendar quarter-end, with the exception of the fourth quarter, which ends on December 31.

The 13-week quarterly periods for fiscal year 2023 ended on April 1, July 1 and September 30.

Comparable periods for 2022 ended on April 2, July 2 and October 1.

The 13-week quarterly periods for fiscal year 2024 ended on March 30, June 29 and September 28.

Comparable periods for 2023 ended on April 1, July 1 and September 30.

The fourth and first quarters may vary in length depending on the calendar year.

Correction of immaterial misstatements

During the quarter ended April 1, 2023 and as part of the balance sheet review process, the Company identified misstatements in its calculation of the carrying amount of noncontrolling interest as it applies to the Company’s complex UP-C tax and ownership structure as prescribed in the amended and restated limited liability company agreement of BV LLC.

Specifically, the Company failed to adjust the carrying amount of its noncontrolling interest to reflect changes in ownership interests relating to BV LLC.

As a result, the previously issued consolidated financial statements reflect an understatement of noncontrolling interest and an overstatement of additional paid-in capital.

As a result of further research conducted, the Company discovered an additional error related to historical deferred income tax balances.

The Company concluded that it had inappropriately calculated deferred income taxes by using an incorrect book basis in its investment of BV LLC during the Company’s IPO, which resulted in an overstatement of deferred tax liabilities, an understatement of noncontrolling interest and an understatement of additional paid-in capital.

The statements affected by these errors include the consolidated balance sheets and consolidated statements of stockholders’ and members’ equity issued in the Company’s Annual Report on Form 10-K for the years ended December 31, 2022 and December 31, 2021.

There was no impact to any other financial statements for the periods presented.

The Company concluded that these misstatements were not material, individually or in the aggregate, as evaluated under the Securities and Exchange Commission Staff Bulletin No.

99, Materiality;

108, Considering the Effects of Prior Year Misstatements in Current Year Financial Statements ;

and Financial Accounting Standards Board ASC 250-10, Accounting Changes and Error Corrections .

However, because of the significance of these items, and to facilitate comparison among periods, the Company decided to revise its previously issued consolidated financial statements on a prospective basis.

The Company corrected its prior period presentation for this error in its 2023 quarterly financial statements included in its Forms 10-Q and 2023 Annual Report on Form 10-K for the period ended December 31, 2023.

The adjustments did not have an impact on revenues, total assets or cash flows.

The following are selected line items from our aforementioned impacted financial statements illustrating the effect of the error corrections thereon:

Consolidated Balance Sheets — December 31, 2022 As Previously Reported Adjustments As Adjusted

Deferred income taxes (b)(d)(e)

$ 74,138 $ ( 71,890 ) $ 2,248

Total liabilities 1,032,317 ( 71,890 ) 960,427

Additional paid-in capital (a)(b)(c)(d)

481,919 8,657 490,576

Noncontrolling interest (a)(c)

23,751 63,233 86,984

Total stockholders’ equity 340,332 71,890 412,222

Consolidated Balance Sheets — December 31, 2021 As Previously Reported Adjustments As Adjusted

Deferred income taxes (b)

$ 133,518 $ ( 73,867 ) $ 59,651

Total liabilities 692,073 ( 73,867 ) 618,206

Additional paid-in capital (a)(b)

465,272 8,046 473,318

Noncontrolling interest (a)

74,865 65,821 140,686

Total stockholders’ equity 533,789 73,867 607,656

The Company’s consolidated statements of changes in stockholders’ and members equity as of December 31, 2022 and December 31, 2021 have been corrected to reflect the above adjustments.

The Company revised the amounts originally reported for the years ended December 31, 2022 and December 31, 2021 for the following items:

(a) Recorded a $ 65,821 decrease to additional paid-in capital and a corresponding increase to noncontrolling interest.

This action effectively rebalanced equity appropriately between the Company and its noncontrolling interests according to their respective BV LLC ownership interests.

(b) Recorded a $ 73,867 decrease to deferred income tax balances and an increase to additional paid in capital to reflect the correction of an error that occurred during the calculation of deferred taxes at the Company’s IPO.

(c) Reflects the entry as discussed in (a) above and additional rebalancing activity of $ 2,588 relating to the issuance of Class A common stock for equity plans during the year ended December 31, 2022.

(d) Reflects the entry as discussed in (b) and an additional $ 1,977 increase to deferred income tax balances and a reduction to additional paid in capital to reflect the deferred tax impact during the year ended December 31, 2022.

(e) The previously reported amount reflects a reclassification of $ 79,863 of deferred tax liabilities associated with the deconsolidation of CartiHeal (2009) Ltd.

into long-term liabilities attributable to discontinued operations as illustrated in the December 31, 2022 consolidated balance sheets.

Refer to Note 4.

Acquisitions and divestitures and Note 15.

Discontinued operations for further details.

Consolidation

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The consolidated financial statements include the Company, its subsidiaries and investments in which the Company has control.

Amounts pertaining to the non-controlling ownership interests held by third parties in the operating results and financial position of the Company’s controlled subsidiaries are reported as non-controlling interests.

Amounts pertaining to the noncontrolling ownership interests held by third parties in the operating results and financial position of the Company’s controlled subsidiaries are reported as noncontrolling interests.

All intercompany balances and transactions have been eliminated in consolidation.

Reclassifications

Certain prior period amounts have been reclassified to conform to the current period presentation.

These changes had no effect on previously reported total revenues, net (loss) income, other comprehensive (loss) income, members’ equity or cash flows.

Certain prior period amounts have been reclassified to conform to current period presentation.

During the first quarter of 2024, the Company reclassified revenue and expense of the SonicOne Ultrasonic Cleansing and Debridement Systems (“SonicOne”) from the Restorative Therapies to the Surgical Solutions business as its capabilities to remove devitalized or necrotic tissue and fiber deposits more closely align with Surgical Solutions’ soft tissue management.

The reclassification of SonicOne activity affected prior presentation of disaggregated revenue by business, which is detailed further in Note 13.

Revenue recognition .

The reclassification had no effect on previously reported total revenues, net loss, other comprehensive loss, stockholders’ equity or cash flows.

Unless otherwise noted, all financial information in the consolidated financial statement footnotes reflects the Company’s results from continuing operations.

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Actual results may differ from those estimates.

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was signed into law, which was aimed at providing emergency assistance and health care for individuals, families, and businesses affected by the COVID-19 pandemic and generally supporting the U.S.

The CARES Act, among other things, included provisions relating to refundable payroll tax credits, deferment of employer social security payments, NOL carryback periods, alternative minimum tax credit refunds, and modifications to the net interest deduction limitations.

The CARES Act allowed the Company to defer employer social security payroll tax payments from May 2020 through December 31, 2020 totaling $ 1,889 .

The Company repaid $ 1,440 in both December 2022 and 2021, including payments on deferred payroll tax balances acquired in business combinations.

Significant accounting policies

Recently issued accounting pronouncements

In addition to being a smaller reporting company and an emerging growth company, the Company also is an accelerated filer under SEC rules and regulations.

Therefore, required effective dates for adopting new or revised accounting standards are generally earlier than when smaller reporting companies and emerging growth companies who are not accelerated filers are required to adopt.

Recently issued accounting pronouncements not yet adopted

In addition to being both a smaller reporting company and an emerging growth company, the Company is an accelerated filer under SEC rules and regulations.

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update 2023-09 (“ASU 2023-09”), Income Taxes, which enhances the transparency of income tax disclosures by expanding annual disclosure requirements related to the rate reconciliation and income taxes paid.

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Retrospective application is permitted.

The Company is currently evaluating this ASU to determine its impact on the Company's disclosures.

The Company is currently evaluating ASU 2023-09 to determine its impact on the Company's disclosures.

In November 2024, the FASB issued Accounting Standards Update 2024-03 (“ASU 2024-03”), Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, which requires additional disclosures regarding income statement expense categories.

The additional disclosures will further disaggregate relevant expense captions in tabular form within the notes to the consolidated financial statements because they include one or more expense categories such as:

(1) purchases of inventory, (2) employee compensation, (3) depreciation, (4) intangible asset amortization and (5) depreciation, depletion and amortization recognized as part of oil- and gas-producing activities or other types of depletion expenses.

ASU 2024-03 also requires:

(i) disclosure of certain amounts that are already required to be disclosed under current requirements in the same disclosure as the other disaggregation requirements;

(ii) a qualitative description of the amount remaining in relevant expense captions that are not separately disaggregated quantitatively;

and (iii) disclosure of the total amount of selling expenses.

In January 2025, the FASB issued Accounting Standards Update 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures:

Clarifying the Effective Date, further defining that ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within the annual reporting periods beginning after December 15, 2027.

The Company is currently evaluating ASU 2024-03 to determine the impact on the Company’s disclosures and plans to adopt ASU 2024-03 in the Company’s annual report on Form 10-K for the fiscal year ending December 31, 2027.

The Company expects that further disaggregation of income statement captions will be necessary, which will be disclosed in the notes to the consolidated financial statements.

Accounting pronouncements recently adopted

In November 2023, the FASB issued Accounting Standards Update 2023-07 (“ASU 2023-07”), Segment Reporting, which improves reportable segment disclosure requirements.

ASU 2023-07 primarily enhances disclosures about significant segment expenses by requiring that a public entity disclose significant segment expenses that are regularly provided to the Chief Operating Decision Maker (“CODM”) and included within each reported measure of segment profit or loss.

This ASU also (i) requires that a public entity disclose, on an annual and interim basis, an amount for other segment items by reportable segment, and a description of its composition;

ASU 2023-07 primarily enhances disclosures about significant segment expenses by requiring that a public entity disclose significant segment expenses that are regularly provided to the CODM and included within each reported measure of segment profit or loss.

ASU 2023-07 also (i) requires that a public entity disclose, on an annual and interim basis, an amount for other segment items by reportable segment, and a description of its composition;

(ii) requires that all annual disclosures are provided in the interim periods;

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The amendments under ASU 2023-07 relate to financial disclosures and its adoption will not have an impact on the Company’s results of operations, financial position or cash flows.

The Company will adopt ASU 2023-07 for the annual reporting period ending December 31, 2024 and for interim reporting periods thereafter.

The Company adopted the provisions of ASU 2023-07 on December 31, 2024.

Refer to Note 14.

Segments for further details.

Variable Interest Entity

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The assets and liabilities of foreign subsidiaries whose functional currency is the local currency are translated into U.S.

dollars at rates of exchange in effect at the close of their month end.

dollars at rates of exchange in effect at the close of their period end.

Equity accounts are translated at their historical rates.

Revenues and expenses are translated at the exchange rate on the transaction date.

Translation gains and losses are accumulated within accumulated other comprehensive (loss) income as a separate component of equity.

Foreign currency transaction gains and losses are included in other expense on the consolidated statements of operations and other comprehensive (loss) income.

There was a gain of $ 351 for the year ended December 31, 2023 and losses of $ 250 and $ 132 for the years ended December 31, 2022 and 2021, respectively.

Comprehensive (loss) income

Comprehensive (loss) income consists of two components:

net (loss) income and other comprehensive (loss) income, which refers to gains and losses that are recorded under U.S.

GAAP as an element of stockholders’ equity and are excluded from net (loss) income.

The Company’s other comprehensive (loss) income consists of a defined benefit plan adjustment and foreign currency translation adjustments from those subsidiaries not using the U.S.

Translation gains and losses are accumulated within accumulated other comprehensive loss as a separate component of equity.

Foreign currency transaction gains and losses are included in other (income) expense on the consolidated statements of operations and other comprehensive loss.

There was a gain of $ 1,306 and $ 351 for the years ended December 31, 2024 and December 31, 2023, respectively, and a loss of $ 250 for the year ended December 31, 2022.

Comprehensive loss

Comprehensive loss consists of two components:

net loss and other comprehensive loss, which refers to gains and losses that are recorded under U.S.

GAAP as an element of stockholders’ equity and is excluded from net loss.

The Company’s other comprehensive loss consists of a defined benefit plan adjustment and foreign currency translation adjustments from those subsidiaries not using the U.S.

dollar as their functional currency.

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Derivatives are recorded on the balance sheet at fair value at each balance sheet date and the Company does not designate whether the derivative instrument is an effective hedge.

Changes in the fair values of derivative instruments are recognized in the consolidated statements of operations and comprehensive (loss) income.

Changes in the fair values of derivative instruments are recognized in the consolidated statements of operations and comprehensive loss .

The Company had entered, and may in the future enter, into derivative contracts related to its debt.

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These incremental costs include the Company’s sales incentive programs for the internal sales force and third-party sales agents as the compensation is commensurate with annual sales activities.

These costs are included in selling, general and administrative expense on the consolidated statements of operations and comprehensive (loss) income.

These costs are included in selling, general and administrative expense on the consolidated statements of operations and comprehensive loss .

The Company values its inventory at the lower of cost or net realizable value and adjusts for the value of inventory that is estimated to be excess, obsolete or otherwise unmarketable.

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During the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with a corresponding offset to goodwill.

Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded within the consolidated statements of operations and comprehensive (loss) income.

Subsequent changes in the estimated fair value of contingent consideration are recognized in earnings in the period of change.

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Upon retirement or sale of property and equipment, the cost of assets disposed of and the related accumulated depreciation and amortization are removed from the accounts, and any resulting gain or loss is included in income from operations.

The Company recorded an impairment loss of $ 33,901 for the year ended December 31, 2024 within the U.S.

reporting segment for net intellectual property attributable to the Company’s Advanced Rehabilitation Business, which includes products such as the L100, L300 Go, L360, H200, Vector Gait & Safety System and Bioness Integrated Therapy System (BITS).

The loss was recorded in impairment of assets within the consolidated statements of operations and comprehensive loss .

Refer to Note 4.

Acquisitions and divestiture s for further information regarding the sale of advanced rehabilitation products and the impairment loss.

The Company recorded impairment losses during the year ended December 31, 2024 within the U.S.

reporting segment for two right-of-use assets related to office and warehouse spaces.

The Company ceased to use these assets during 2024, but has the intent and ability to sublease them.

During the fourth quarter of 2024, the probability of subleasing the spaces declined due to continued market saturation and being closer to the end of these leases.

The Company performed a recoverability analysis, concluding that the carrying value of the right-of-use assets exceeded the undiscounted future cash flows on potential subleases, triggering an impairment calculation.

The Company utilized prices for similar assets in their respective markets and probability-based assumptions on future sublease opportunities to determine the fair value of the right-of-use assets.

The carrying values of the right-of-use assets exceed their fair values, which resulted in a $ 2,456 loss recorded in impairment of assets within the consolidated statements of operations and comprehensive loss .

The Company recorded an impairment loss of $ 78,615 for the year ended December 31, 2023 in the U.S.

reporting segment of net intellectual property attributable to the TheraSkin and TheraGenesis products, which were sold in May 2023.

The loss was recorded in impairment of assets within the consolidated statements of operations and comprehensive (loss) income.

During the year ended December 31, 2021, the Company recognized an impairment of $ 5,674 on long lived assets related to a VIE of which $ 5,176 is attributable to the non-controlling interests, refer to Note 4.

Acquisitions and divestitures for further information regarding both of these impairments.

Except for the previously described impairments of intangibles and the Company’s VIE, there were no other events, facts or circumstances for the years ended December 31, 2023, 2022 and 2021 that resulted in any impairment charges to the Company’s property, equipment, intangible or other long-lived assets.

The loss was recorded in impairment of assets within the consolidated statements of operations and comprehensive loss .

Refer to Note 4.

Acquisitions and divestitures for further information regarding this impairment.

Except for the previously described impairments of intangibles, there were no other events, facts or circumstances for the years ended December 31, 2024, 2023 and 2022 that resulted in any impairment charges to the Company’s property, equipment, intangible or other long-lived assets.

Property and equipment

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Intangible assets

Finite-lived intangible assets were initially recorded at fair value upon acquisition and are amortized using the straight-line method over their estimated useful lives in years are as follows:

Finite-lived intangible assets were initially recorded at fair value upon acquisition and are amortized using the straight-line method over their estimated weighted average useful lives in years are as follows:

Weighted Average Useful Life

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reporting unit for the year ended December 31, 2022.

The impairment was recorded within impairment of assets on the consolidated statements of operations and comprehensive (loss) income.

The impairment was recorded within impairment of assets on the consolidated statements of operations and comprehensive loss .

Refer to Note 3.

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Concentration of risk

The Company provides credit, in the normal course of business, to its customers.

The Company provides credit to its customers in the normal course of business.

The Company does not require collateral or other securities to support customer receivables.

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The Company utilizes the straight-line amortization method to recognize the expense associated with the awards with graded vesting terms.

Compensation expense is included in selling, general and administrative expense and research and development expense on the consolidated statement of operations and comprehensive (loss) income based upon the classification of the employees who were granted the awards.

Compensation expense is included in selling, general and administrative expense and research and development expense on the consolidated statement of operations and comprehensive loss based upon the classification of the employees who were granted the awards.

Advertising costs

Advertising costs include costs incurred to promote the Company’s business and are expensed as incurred and recorded as selling, general and administrative expense within the consolidated statement of operations and comprehensive (loss) income.

Advertising costs were $ 4,422 , $ 3,853 and $ 5,203 for the years ended December 31, 2024, 2023 and 2022, respectively.

Research and development expense

Research and development expense consist primarily of employee compensation and related expenses as well as contract research organization services.

Research and development expense consists primarily of employee compensation and related expenses as well as contract research organization services.

Internal research and development costs are expensed as incurred.

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Basic earnings per share is calculated using net income or loss attributable to Bioventus Inc.

Class A common stock-holders, divided by the weighted-average Class A common stock outstanding.

Class A common stockholders, divided by the weighted-average Class A common stock outstanding.

Diluted earnings per share is calculated using net income attributable to Bioventus Inc.

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Balance sheet information

Cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash totaled $ 36,964 and $ 30,186 as of December 31, 2023 and 2022.

Cash and restricted cash of $ 1,628 and $ 23 , respectively, attributable to CartiHeal has been reclassified to current assets attributable to discontinued operations within the December 31, 2022 consolidated balance sheets.

Refer to Note 4.

Acquisitions and divestitures and Note 15.

Discontinued operations for further details regarding the deconsolidation of CartiHeal.

Accounts receivable, net

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Accounts receivable, net of allowances, consisted of the following as of December 31:

Accounts receivable (a)

$ 127,008 $ 143,317

Accounts receivable $ 130,257 $ 127,008

Allowance for credit losses ( 2,864 ) ( 4,219 )

$ 127,393 $ 122,789

(a) Other receivables of $ 350 attributable to CartiHeal was reclassified to current assets attributable to discontinued operations within the December 31, 2022 consolidated balance sheets.

Refer to Note 4.

Acquisitions and divestitures and Note 15.

Discontinued operations for further details regarding the deconsolidation of CartiHeal.

Due to the short-term nature of its receivables, the estimate of expected credit losses is based on aging of the account receivable balances.

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Beginning balance $ ( 4,219 ) $ ( 7,022 )

Benefit (provision) for expected credit losses 1,103 ( 5,190 )

Benefit for expected credit losses 434 1,103

Write-offs 4,334 2,827

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Inventory consisted of the following as of December 31:

Raw materials and supplies (a)

$ 21,062 $ 18,454

Raw materials and supplies $ 22,098 $ 21,062

Finished goods 70,377 70,271

$ 92,475 $ 91,333

(a) Raw material inventory of $ 642 attributable to CartiHeal has been reclassified to current assets attributable to discontinued operations within the December 31, 2022 consolidated balance sheets.

Refer to Note 4.

Acquisitions and divestitures and Note 15.

Discontinued operations for further details regarding the deconsolidation of CartiHeal.

Property and equipment, net

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Finance leases 15,737 15,737

Machinery and equipment (a)

Machinery and equipment 1,461 2,180

Assets not yet placed in service 269 4,065

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$ 27,012 $ 36,605

(a) Machinery and equipment and accumulated depreciation attributable to CartiHeal of $ 269 and $ 78 , respectively, were reclassified to long-term assets attributable to discontinued operations within the December 31, 2022 consolidated balance sheets.

Refer to Note 4.

Acquisitions and divestitures and Note 15.

Discontinued operations for further details regarding the deconsolidation of CartiHeal.

Depreciation expense from continuing operations was $ 10,533 , $ 12,121 and $ 5,688 for the years ended December 31, 2024, 2023 and 2022, respectively.

The Company incurred a $ 2,038 disposal loss on fixed assets during the year ended December 31, 2023 as a result of the integration of acquisitions.

The loss is recorded in loss on disposals within the consolidated condensed statements of operations and other comprehensive (loss) income.

Changes in the carrying amounts of goodwill by reportable segment during the years ended December 31, 2023 and December 31, 2022 are as follows:

International Consolidated

Balance at December 31, 2021 $ 138,863 $ 8,760 $ 147,623

Additions 55,295 4,999 60,294

Deconsolidation of noncontrolling interest ( 494 ) — ( 494 )

Purchase accounting adjustments ( 4,467 ) — ( 4,467 )

Impairment ( 189,197 ) — ( 189,197 )

Reclassification (a)

— ( 6,297 ) ( 6,297 )

Balance at December 31, 2022 $ — $ 7,462 $ 7,462

Balance at December 31, 2023 (b)

$ — $ 7,462 $ 7,462

(a) Goodwill of $ 6,297 attributable to CartiHeal was reclassified to long-term assets attributable to discontinued operations within the December 31, 2022 consolidated balance sheets.

Refer to Note 4.

Acquisitions and divestitures and Note 15.

Discontinued operations for further details regarding the deconsolidation of CartiHeal.

(b) There was no activity related to goodwill during the year ended December 31, 2023.

Additions during the year ended December 31, 2022 were the result of the acquisition of CartiHeal and purchase accounting adjustments stem from changes in the preliminary fair values of assets acquired and liabilities assumed in previous and current acquisitions.

Refer to Note 4.

Acquisitions and divestitures for further information.

Due to the significant decline in the Company’s Class A common stock, the Company recorded a non-cash goodwill impairment charge of $ 189,197 within the United States reporting unit for the year ended December 31, 2022 of which $ 124,697 was recorded in the impairment of assets and $ 64,500 in loss on discontinued operations, net of tax within the consolidated statements of operations and comprehensive (loss) income.

The impairment was recorded within impairment of assets on the consolidated statements of operations and comprehensive (loss) income.

There were no accumulated goodwill impairment losses as of December 31, 2021.

The loss is recorded in loss on disposals within the consolidated condensed statements of operations and other comprehensive loss.

The Company’s goodwill totaled $ 7,462 as of December 31, 2024 and 2023, which fully resides within the International business segment.

Accumulated impairment charges totaled $ 189,197 as of December 31, 2024, resulting from a significant decline in the Company’s Class A common stock during the year ended December 31, 2022.

The non-cash goodwill impairment charge was recorded within the United States reporting unit, of which $ 124,697 was recorded in the impairment of assets and $ 64,500 in loss on discontinued operations, net of tax within the consolidated statements of operations and comprehensive loss .

Intangible assets, net

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Less accumulated amortization:

Intellectual property (a)

Intellectual property (a)(b)

( 237,829 ) ( 218,031 )

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$ 404,729 $ 482,350

(a) Intellectual property and accumulated depreciation attributable to CartiHeal totaling $ 410,200 and $ 11,327 , respectively, were reclassified to long-term assets attributable to discontinued operations within the December 31, 2022 consolidated balance sheets.

Refer to Note 4.

Acquisitions and divestitures and Note 15.

Discontinued operations for further details regarding the deconsolidation of CartiHeal.

(a) The Company recorded an impairment loss of $ 33,901 for the year ended December 31, 2024 within the U.S.

reporting segment relating to the net intellectual property solely attributable to the Company’s Advanced Rehabilitation Business.

The loss was recorded in impairment of assets within the consolidated statements of operations and comprehensive loss.

Refer to Refer to Note 4.

Acquisitions and divestitures for further details regarding businesses held for sale.

(b) The Company recorded an impairment loss of $ 78,615 for the year ended December 31, 2023 in the U.S.

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Income and other taxes 3,868 4,749

Other liabilities (a)

19,702 16,947

Other liabilities 20,037 19,702

$ 135,879 $ 119,795

(a) Other liabilities attributable to CartiHeal of $ 384 were reclassified into current liabilities attributable to discontinued operations within December 31, 2022 consolidated balance sheets.

Refer to Note 4.

Acquisitions and divestitures and Note 15.

Discontinued operations for further details.

Acquisitions and divestitures

Advanced Rehabilitation Business

On September 30, 2024, the Company entered into a Purchase and Sale Agreement (the “Purchase Agreement”) with a third-party purchaser to sell certain products within its advanced rehabilitation business, including the L100, L300 Go, L360, H200, Vector Gait & Safety System and Bioness Integrated Therapy System (“BITS”) (collectively, the “Advanced Rehabilitation Business”).

The Company evaluated the Advanced Rehabilitation Business for impairment due to its divestiture.

As a result of this evaluation, the Company recorded impairments totaling $ 33,901 for the year ended December 31, 2024 under the U.S.

reporting segment within the consolidated condensed statements of operations and comprehensive loss .

The impairment losses reduced the intangible assets of the Advanced Rehabilitation Business to reflect their respective fair values less any costs to sell.

The fair value of its intangibles was based on the consideration agreed to with the purchaser for the Advanced Rehabilitation Business.

On December 31, 2024, the Company closed the sale of the Advanced Rehabilitation Business and received $ 24,678 at closing, net of transactional fees, subject to a post-closing adjustment for net working capital.

The Company may also receive an aggregate of $ 20,000 in potential earn-out payments, which are based on the achievement of certain revenue and financial metric thresholds in respect to sales of products from the Advanced Rehabilitation Business during the 2025 and 2026 fiscal years.

The Company had incurred $ 2,500 in transactional fees resulting from the divestiture of the Advanced Rehabilitation Business.

The Advanced Rehabilitation Business was considered non-core and required additional research and development expenditures to achieve its next stage of growth.

The sale of the Advanced Rehabilitation Business is expected to enhance the Company’s strategic focus on its remaining businesses and improve liquidity, as the proceeds, net of transactional fees, were used to pay $ 20,000 in long-term debt obligations.

Refer to Note 5.

Financial instruments for further information regarding the Company’s outstanding long-term debt obligations.

Wound Business

On May 22, 2023, the Company closed the sale of certain assets within its Wound Business, including the TheraSkin and TheraGenesis products (collectively, the “Wound Business” or the “Disposal Group”), for potential consideration of $ 84,675 , including $ 34,675 at closing, $ 5,000 deferred for 18 months and up to $ 45,000 in potential earn-out payments (“Earn-out Payments”), which are based on the achievement of certain revenue thresholds by the purchaser of the Wound Business for sales of the TheraSkin and TheraGenesis products during the 2024, 2025 and 2026 fiscal years.

On May 22, 2023, the Company closed the sale of certain assets within its Wound Business, including the TheraSkin and TheraGenesis products (collectively, the “Wound Business” or the “Disposal Group”), for potential consideration of $ 84,675 , including $ 34,675 at closing, $ 5,000 deferred for 18 months and up to $ 45,000 in potential earn-out payments, which are based on the achievement of certain revenue thresholds by the purchaser of the Wound Business for sales of the TheraSkin and TheraGenesis products during the 2024, 2025 and 2026 fiscal years.

The Company received the deferred payment in November 2024, which was used to pay $ 5,000 of long-term debt obligations.

The Company incurred $ 3,880 in transactional fees resulting from the sale of the Wound Business.

The loss resulting from the deconsolidation of the Disposal Group totaled $ 1,539 for the year ended December 31, 2023 and was recorded in loss on disposals within the consolidated statements of operations and comprehensive (loss) income.

The Company used the proceeds from the sale of its Wound Business to prepay $ 30,000 of long-term debt obligations.

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Financial Instruments for further details regarding the Company’s outstanding long-term debt obligations.

The Company evaluated the Wound Business for impairment prior to its sale and recorded a $ 78,615 impairment within the consolidated statements of operations and comprehensive (loss) income during the year ended December 31, 2023 as a result of this evaluation to reduce the intangible assets of the Disposal Group to reflect their respective fair values less any costs to sell.

The Company evaluated the Wound Business for impairment prior to its sale and recorded a $ 78,615 impairment within the consolidated statements of operations and comprehensive loss during the year ended December 31, 2023 as a result of this evaluation to reduce the intangible assets of the Disposal Group to reflect their respective fair values less any costs to sell.

The fair value of the Disposal Group’s intangibles was determined based on the consideration received for the Wound Business.

CartiHeal (2009) Ltd.

On July 12, 2022, the Company completed the acquisition of 100 % of the remaining shares in CartiHeal, a privately held company headquartered in Israel and the developer of the proprietary Agili-C implant for the treatment of joint surface lesions in traumatic and osteoarthritic joints.

The Company previously held an equity interest in CartiHeal’s fully diluted shares with a carrying value of $ 15,768 and $ 16,771 as of July 12, 2022 and December 31, 2021, respectively.

Net equity losses associated with CartiHeal for the years ended December 31, 2022 and 2021 totaled $ 1,003 and $ 1,868 , respectively, which are included in discontinued operations, net of tax on the consolidated statements of operations and comprehensive (loss) income.

The Company acquired CartiHeal (the “CartiHeal Acquisition”) for an aggregate purchase price of approximately $ 315,000 and an additional $ 135,000 , payable after closing upon the achievement of a certain sales milestone (“Sales Milestone”, or “CartiHeal Contingent Consideration”).

The Company paid $ 100,000 of the aggregate purchase price upon closing consisting of a $ 50,000 deposit held in trust and $ 50,000 from a financing arrangement (Refer to Note 5.

Financial instruments for further information regarding financing arrangements).

The Company also paid approximately $ 8,622 of CartiHeal’s transaction-related fees and expenses and deferred $ 215,000 (“Deferred Amount”) of the aggregate purchase price otherwise due at closing.

The Deferred Amount was to be paid in five tranches commencing in 2023 and ending no later than 2027 as follows:

• $ 50,000 due upon the earliest to occur — the publication in a peer-reviewed orthopedic journal of an article that presents the results of the pivotal clinical trial (“First Paper Milestone”) or July 1, 2023;

• $ 50,000 due upon the earliest to occur — the implantation of Agili-C devices in 100 patients in the United States or September 1, 2023;

• $ 25,000 due upon the earliest to occur — the publication in a peer-reviewed orthopedic journal of an article that presents any new or additional clinical data subsequent to the First Paper Milestone with respect to Agili-C (“Second Paper Milestone”) or January 1, 2025;

• $ 25,000 due upon the earliest to occur — the publication in a peer-reviewed orthopedic journal of an article that presents any new or additional clinical data subsequent to the First and Second Paper Milestone with respect to Agili-C or January 1, 2026;

• $ 65,000 due upon the earliest to occur — obtaining a U.S.

Category 1 Current Procedural Terminology (“CPT”) code from Centers for Medicare and Medicaid Services (“CMS”) for Agili-C or January 1, 2027.

Pursuant to the CartiHeal Amendment (as defined below), the Company owed interest on each tranche of the Deferred Amount at a rate of 8.0 % annually, until such tranche was paid.

The Sales Milestone will be payable upon the achievement of $ 75,000 in trailing twelve month sales pursuant to the CartiHeal Amendment.

The Company had entered into an Option and Equity Purchase Agreement with CartiHeal (“Option Agreement”) in January 2020 and a subsequent amendment in June 2022 (“CartiHeal Amendment”).

The Option Agreement provided the Company with an exclusive option to acquire 100 % of CartiHeal’s shares (“Call Option”), and provided CartiHeal with a put option that would require the Company to purchase 100 % of CartiHeal’s shares under certain conditions.

In August 2021, CartiHeal achieved pivotal clinical trial success, as defined in the Option Agreement, for the Agili-C implant.

In order to preserve the Company’s Call Option, in accordance with the Option Agreement and upon approval of the Company’s Board of Directors (“BOD”), the Company deposited $ 50,000 into escrow in August 2021.

The First Paper Milestone under the Option Agreement occurred on February 13, 2023, which obligated the Company to make the first $ 50,000 payment, plus applicable interest, under the Option Agreement.

On February 27, 2023, the Company entered into a settlement agreement (the “Settlement Agreement”) with Elron Ventures Ltd.

(“Elron” and together with the Company, the “Parties”) as representative of CartiHeal’s selling securityholders under the Option Agreement (collectively, the “Former Securityholders”).

Pursuant to the Settlement Agreement, Elron, on behalf of the Former Securityholders, agreed to forbear from initiating any legal action or proceedings relating to non-payment of any obligations arising under the Option Agreement during a period of 30 calendar days (the “Interim Period”) in exchange for (i) a one-time non-refundable amount of $ 10,000 and (ii) a one-time non-refundable payment of $ 150 to Elron to be used in accordance with the expense fund provisions of the Option Agreement.

The Interim Period expired on March 29, 2023 and the Company did not exercise its right to extend the Interim Period.

In addition, the Parties mutually released any further claims under the Option Agreement and related transaction documents, including without limitation a release by the Former Securityholders of any rights to enforce the provisions of the Option Agreement or make further monetary claims against the Company and/or its respective affiliates and representatives.

On July 12, 2022, the Company completed the acquisition of 100 % of the remaining shares in CartiHeal (2009) Ltd.

(“CartiHeal”), in which the Company previously held an equity interest.

CartiHeal is a privately held company headquartered in Israel and the developer of the proprietary Agili-C implant for the treatment of joint surface lesions in traumatic and osteoarthritic joints.

The acquisition of CartiHeal involved an aggregate purchase price of approximately $ 315,000 and an additional $ 135,000 , payable after closing upon the achievement of a certain sales milestone (“CartiHeal Contingent Consideration”).

The Company paid $ 100,000 of the aggregate purchase price upon closing, deferred $ 215,000 (the “Deferred Amount”) of the aggregate purchase price otherwise due at closing and paid $ 8,622 in transaction-related fees and expenses.

The Deferred Amount was to be paid in five tranches based upon certain medical and research achievements and was subject to an 8.0 % annual interest rate.

On February 13, 2023, the first tranche of the Deferred Amount plus applicable interest became due.

The Company subsequently entered into a settlement agreement (the “Settlement Agreement”) with Elron Ventures Ltd.

(“Elron” and together with the Company, the “Parties”) as representative of CartiHeal’s selling securityholders (collectively, the “Former Securityholders”).

Pursuant to the Settlement Agreement, Elron, on behalf of the Former Securityholders, agreed to forbear from initiating any legal action or proceedings relating to non-payment of any obligations arising under the previously entered into Option and Equity Purchase Agreement with CartiHeal (the “Option Agreement”) during a period of 30 calendar days (the “Interim Period”) in exchange for (i) a one-time non-refundable amount of $ 10,000 and (ii) a one-time non-refundable payment of $ 150 to Elron to be used in accordance with the expense fund provisions under the Option Agreement.

The Interim Period expired on March 29, 2023 and the Company did not exercise its right to extend the Interim Period as the Company was not able to find a financing solution to fund the payment obligations under the Option Agreement on terms the Company believed to be favorable to it and its shareholders.

In addition, the Parties mutually released any further claims under the Option Agreement and related transaction documents, including without limitation a release by the Former Securityholders of any rights to enforce the provision of the Option Agreement or make further monetary claims against the Company and/or its respective affiliates and representatives.

The release of obligations includes liabilities associated with the Deferred Amount and CartiHeal Contingent Consideration.

The Company transferred 100 % of its shares in CartiHeal to a trustee (the “Trustee”) for the benefit of the Former Securityholders pursuant to the Settlement Agreement.

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The Company treated the deconsolidation of CartiHeal as a discontinued operation.

The loss upon disposal was $ 60,639 and was recorded within discontinued operations, net of tax within the consolidated statements of operations and comprehensive (loss) income.

The loss upon disposal was $ 60,639 and was recorded within discontinued operations, net of tax within the consolidated statements of operations and comprehensive loss .

The loss on disposal is comprised of the book value of CartiHeal’s net assets at the time of disposal, goodwill attributable to CartiHeal and the previously discussed non-refundable payments made to Elron.

The Company allowed the Interim Period to expire on March 29, 2023 as the Company was not able to find a financing solution to fund the payment obligations under the Option and Equity Purchase Agreement on terms the Company believed to be favorable to it and its shareholders.

The fair value of consideration for the CartiHeal Acquisition is comprised of the following:

Cash consideration $ 100,000

Transaction related costs 8,622

Subtotal of cash at closing 108,622

Deferred Amount 183,400

Sales Milestone 61,901

Fair value of previously held equity interest (a)

Total consideration $ 393,400

(a) Remeasurement of the Company’s equity method investment in CartiHeal, net of equity losses as a result of the purchase.

The remeasurement included a gain of $ 23,709 calculated as the difference between the fair value and the carrying value of the Company’s investment in CartiHeal at the acquisition date and was recognized in other income for the year ended December 31, 2023 on the consolidated statements of operations and comprehensive (loss) income.

The fair value was based upon:

(i) the consideration transferred to members owning 89.97 % of CartiHeal’s fully diluted shares;

(ii) calculating the value of CartiHeal’s fully diluted shares based upon the transferred consideration;

and (iii) applying the calculated value to the Company’s 10.03 % ownership in CartiHeal’s fully diluted shares at the acquisition date.

The Company accounted for the CartiHeal Acquisition using the acquisition method of accounting whereby the total purchase price was preliminarily allocated to tangible and intangible assets acquired and liabilities assumed based on respective fair values.

The following table summarizes the fair values of the assets acquired and liabilities assumed at the acquisition date:

Fair value of consideration $ 393,400

Assets acquired and liabilities assumed:

Cash and cash equivalents and restricted cash 3,781

Inventory 642

Prepaid and other current assets 552

Property and equipment 259

Intangibles 410,200

Investment and other assets 727

Accounts payable ( 18 )

Accrued liabilities ( 459 )

Other current liabilities ( 171 )

Deferred income taxes ( 79,863 )

Other liabilities ( 2,544 )

Net assets acquired 333,106

Resulting goodwill $ 60,294

Goodwill of $ 55,295 and $ 4,999 was allocated to the U.S.

and International reporting units, respectively.

CartiHeal’s intangibles consists of the following:

Useful Life Fair Value

Intellectual property - US segment 20 years $ 351,500

Intellectual property - International segment 8 years 58,700

The estimated fair value of the acquired CartiHeal intangibles was determined using an income approach, a valuation technique that estimates the fair value of an asset based on market participant expectations of the cash flows that an asset would generate over its remaining useful life.

The determination of the useful lives was based upon consideration of market participant assumptions and transaction specific factors.

Misonix, Inc.

The Company acquired 100 % of the capital stock of Misonix, Inc.

(“Misonix”) in a cash-and-stock transaction (the “Misonix Acquisition”) on October 29, 2021.

Total consideration for the Misonix Acquisition was $ 525,316 comprised of $ 274,562 in Bioventus Class A common stock, $ 223,118 in cash and $ 27,636 in value for Misonix options settled with Bioventus options.

Misonix manufactures minimally invasive surgical ultrasonic medical devices used for precise bone sculpting, removal of soft and hard tumors and tissue debridement, primarily in the areas of neurosurgery, orthopedic surgery, plastic surgery and maxillo-facial surgery.

Misonix also exclusively distributes skin allografts used to support healing.

Bioness, Inc.

The Company acquired 100 % of the capital stock of Bioness, Inc.

(“Bioness”) for $ 48,933 in cash and future contingent consideration payments (the “Bioness Acquisition”).

Bioness is a global leader in neuromodulation and advanced rehabilitation medical devices through its innovative peripheral nerve stimulation therapy and premium advanced rehabilitation solutions.

Contingent consideration related to the Bioness Acquisition (“Bioness Contingent Consideration”) is comprised of future earn-out payments contingent upon the achievement of certain research and development projects as well as sales milestones related to Bioness products.

The Bioness Acquisition Agreement includes maximum earn-out payments of $ 50,000 as follows:

(i) $ 20,000 for meeting net sales targets for certain implantable products over a three year period ending on June 30, 2025 at the latest;

(ii) up to $ 10,000 for meeting net sales milestones for certain implantable products over a three year period ending on June 30, 2025 at the latest;

and (iii) $ 20,000 for maintaining Centers for Medicare & Medicaid Services coverage and reimbursement for certain products at specified levels as of December 31, 2024.

The Company had a fully diluted 8.8 % ownership of Harbor Medtech Inc.’s (“Harbor”) Series C Preferred Stock and an exclusive Collaboration Agreement with Harbor, which resulted in the consolidation of Harbor.

The Company terminated the Collaboration Agreement on June 8, 2021, which resulted in the deconsolidation of Harbor and the recognition of a $ 5,674 impairment of Harbor’s long-lived assets.

The impairment was recorded within impairment of variable entity assets for the year ended December 31, 2022 in the consolidated statements of operations and comprehensive (loss) income, of which $ 5,176 was attributable to the non-controlling interest.

An additional impairment of $ 1,369 , representing the Company’s remaining investment balance in Harbor, was recorded within other (income) expense for the year ended December 31, 2021 in the consolidated statements of operations and comprehensive (loss) income.

The Company continues to have license rights to certain technology obtained from Harbor and is continuing product development initiated under the Collaboration Agreement.

On August 23, 2021, the Company purchased shares of Trice Medical, Inc.’s (“Trice”) Series D Preferred Stock for $ 10,000 , representing an 8.4 % ownership interest of its fully diluted shares.

Trice is a privately held company that develops and commercializes minimally invasive technologies for sports medicine and orthopedic surgical procedures and it did not have a readily determinable fair value.

Trice is a privately held company that develops and markets minimally invasive technologies for sports medicine and orthopedic surgical procedures and it did not have a readily determinable fair value.

The investment in Trice was recorded at cost, less any impairment, plus or minus any changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer.

In December 2022, the Company recognized an impairment of $ 10,285 representing its entire ownership interest due to Trice’s liquidity situation.

The impairment was recorded within other (income) expense on the consolidated statements of operations and comprehensive (loss) income for the year ended December 31, 2022.

The impairment was recorded within other (income) expense on the consolidated statements of operations and comprehensive loss for the year ended December 31, 2022.

Financial instruments

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On December 6, 2019, the Company entered into a Credit and Guaranty Agreement (the “2019 Credit Agreement”) that was comprised of a $ 200,000 term loan (“Original Term Loan”) and a $ 50,000 revolving facility (the “Revolver”).

The Company amended the 2019 Credit Agreement on August 29, 2021, and then again on October 29, 2021 in connection with the Misonix Acquisition in which the Company prepaid $ 80,000 on the Original Term Loan.

The Company amended the 2019 Credit Agreement on August 29, 2021, and then again on October 29, 2021 in connection with the acquisition of Misonix, Inc.

in which the Company prepaid $ 80,000 on the Original Term Loan.

The 2019 Credit Agreement, as amended, subsequent to the prepayment, was comprised of a $ 360,750 term loan (“Term Loan”) and the Revolver.

On July 11, 2022, the Company further amended the 2019 Credit Agreement in conjunction with the CartiHeal Acquisition.

On July 11, 2022, the Company further amended the 2019 Credit Agreement in conjunction with the acquisition of CartiHeal.

Pursuant to that amendment, an $ 80,000 term loan facility (the “July 2022 Term Loan” and, together with the Term Loan, the “Term Loan Facilities”) was extended to the Company to be used for:

(i) the financing of the CartiHeal Acquisition;

(i) the financing of the acquisition of CartiHeal;

(ii) the payment of related fees and expenses;

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As a result, on March 31, 2023, the Company entered into another amendment to the 2019 Credit Agreement to, among other things, modify certain financial covenants, waive the noncompliance at December 31, 2022, and to modify interest rates applicable to borrowings under the 2019 Credit Agreement.

The Company was in compliance as of December 31, 2023 with the financial covenants as stated within the 2019 Credit Agreement then in effect.

On January 18, 2024 (the “Closing Date”), the Company further amended the 2019 Credit Agreement (collectively, with the August 2021, October 2021, July 2022 and March 2023 amendments, the “Amended 2019 Credit Agreement”), to further modify certain financial covenants under the 2019 Credit Agreement.

The Term Loan Facilities will now mature on October 29, 2026 (“Maturity”).

The Revolver will mature on October 29, 2025.

SOFR loans and base rate loans had a margin of 3.25 % and 2.25 %, respectively, subsequent to July 11, 2022 and prior to the Closing Date.

As of the March 31, 2023 amendment, SOFR loans and base rate loans had a margin of 4.25 % and 3.25 %, respectively.

The Company was in compliance as of December 31, 2024 and 2023 with the financial covenants as stated within the 2019 Credit Agreement then in effect.

The Term Loan Facilities matures on October 29, 2026 (“Maturity”).

The Revolver matures on October 29, 2025.

Secured overnight financial rate (“SOFR”) loans and base rate loans had a margin of 3.25 % and 2.25 %, respectively, subsequent to July 11, 2022 and prior to the Closing Date.

Subsequent to the March 31, 2023 amendment, SOFR loans and base rate loans had a margin of 4.25 % and 3.25 %, respectively.

All obligations under the Amended 2019 Credit Agreement are guaranteed by the Company and certain wholly owned subsidiaries where substantially all the assets of the Company collateralize the obligations.

The Amended 2019 Credit Agreement contains customary affirmative and negative covenants, including those related to financial reporting and notification, restrictions on the declaration or payment of certain distributions on or in respect of Bioventus LLC’s equity interests, restrictions on acquisitions, investments and certain other payments, limitations on the incurrence of new indebtedness, limitations on transfers, sales and other dispositions of assets of Bioventus LLC and its subsidiaries, as well as limitations on making changes to the business and organizational documents of Bioventus LLC and its subsidiaries.

Financial covenant requirements include (i) a maximum debt leverage ratio of not greater than 5.65 to 1.00 for the testing period ending March 31, 2024, 5.00 to 1.00 for the testing period ending June 30, 2024, 4.75 to 1.00 for the testing period ending September 30, 2024, 4.50 to 1.00 for the testing period ending December 31, 2024, 4.25 to 1.00 for testing period ending March 31, 2025, 4.00 to 1.00 for testing period ending June 30, 2025 and each testing period thereafter, and, beginning with the testing period ending March 31, 2025, to be subject to a temporary increase to 4.50 to 1.00 upon certain events, and (ii) an interest coverage ratio not less than 1.75 to 1.00 for the testing period ending March 31, 2024, 1.75 to 1.00 for the testing period ending June 30, 2024, 1.75 to 1.00 for the testing period ending September 30, 2024, 2.00 to 1.00 for the testing period ending December 31, 2024, 2.00 to 1.00 for the testing period ending March 31, 2025, 2.25 to 1.00 for the testing period ending June 30, 2025, 2.50 to 1.00 for the testing period ending September 30, 2025 and 3.00 to 1.00 for the testing period ending December 31, 2025 and each testing period thereafter.

Financial covenant requirements include (i) a maximum debt leverage ratio of not greater than 4.50 to 1.00 for the testing period ending December 31, 2024, 4.25 to 1.00 for the testing period ending March 31, 2025, 4.00 to 1.00 for the testing period ending June 30, 2025 and at the end of each testing period occurring thereafter, and beginning on March 31, 2025, to be subject to a temporary increase to 4.50 to 1.00 upon certain events;

and (ii) an interest coverage ratio not less than 2.00 to 1.00 for the testing period ending December 31, 2024, 2.00 to 1.00 for the testing period ending March 31, 2025, 2.25 to 1.00 for the testing period ending June 30, 2025, 2.50 to 1.00 for the testing period ending September 30, 2025 and 3.00 to 1.00 for the testing period ending December 31, 2025 and each testing period thereafter.

In addition, during the period commencing on the Closing Date and ending upon the satisfaction of certain conditions occurring not prior to October 29, 2025, the Company will be subject to certain additional requirements and covenants, including a requirement to maintain Liquidity (as defined in the Amended 2019 Credit Agreement) of not less than $ 10,000 as of the end of each calendar month during such period.

The July 2022 Term Loan had an original issue discount of $ 240 and deferred financing costs of $ 101 .

No financing or deferred costs were expensed and there was no loss on debt refinancing and modification as a result of the July 2022 amendment.

The Company paid financing costs of $ 3,318 as a result of the October 2021 amendment, of which $ 1,421 was capitalized to the consolidated balance sheets and $ 1,897 was recorded in selling, general and administrative expenses during the year ended December 31, 2021 within the consolidated statements of operations and comprehensive (loss) income.

Due to the change in participating lenders, an additional $ 269 in deferred costs was recorded in interest expense for the year ended December 31, 2021.

Loss on debt refinancing and modification totaled $ 2,162 for the year ended December 31, 2021.

Capitalized deferred fees from the October 2021 amendment totaled $ 3,174 and $ 893 for the Term Loan and the Revolver, respectively.

The January 2024 amendment had deferred financing costs of $ 1,180 , of which $ 325 was expensed and $ 855 was capitalized.

The March 2023 amendment had deferred financing costs of $ 3,661 , of which $ 1,617 was expensed and $ 2,044 was capitalized.

There were no losses on debt refinancing and modification as a result of either the January 2024 or March 2023 amendments.

Deferred financing costs expensed resulting from the amendments were recorded in selling, general and administrative expense within the consolidated statements of operations and other comprehensive loss and amounts capitalized were recorded primarily in long-term debt, less current portion within the consolidated balance sheets.

As of December 31, 2024, $ 335,627 was outstanding on the Term Loan Facilities, net of original issue discount of $ 1,090 and deferred financing costs of $ 1,147 .

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The Company recorded $ 1,524 , $ 1,706 and $ 853 for deferred cost amortization in interest expense for the years ended December 31, 2024, 2023 and 2022, respectively.

Scheduled quarterly principal payments of the Term Loan Facilities are $ 3,056 for the first quarter of 2024, $ 8,264 for the second, third and fourth quarters of 2024 and $ 11,019 for the year 2025 and the first three quarters of 2026 with a final payment of $ 277,469 at Maturity.

Contractual maturities of long term debt for the next three years are as follows:

2024—$ 27,848 , 2025—$ 44,075 and 2026—$ 310,525 , respectively.

Scheduled quarterly principal payments for the Term Loan Facilities are $ 5,301 in the third quarter of 2025, $ 22,038 in the fourth quarter of 2025, three quarterly payments of $ 11,019 during 2026 with a final payment of $ 277,469 at Maturity.

Contractual maturities of long term debt for the next two years are as follows:

2025—$ 27,339 and 2026—$ 310,525 .

The Company may voluntarily prepay the Term Loan Facilities without premium or penalty upon prior notice.

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This is classified as a Level 2 instruments within the fair value hierarchy.

The Revolver is a five-year revolving credit facility that includes revolving and swingline loans as well as letters of credit (“LOC”) and, inclusive of all, cannot exceed $ 45,000 at any one time as the Revolver capacity was reduced at December 31, 2023 in accordance with the 2019 Credit Agreement then in effect.

The Revolver credit capacity will be further reduced by $ 5,000 on June 30, 2024.

The Revolver was a five-year revolving credit facility, that was subsequently reduced to a four-year revolving credit facility in the Amended 2019 Credit Agreement, that includes revolving and swingline loans as well as letters of credit (“LOC”) and, inclusive of all, cannot exceed $ 40,000 at any one time.

The Revolver’s capacity was reduced $ 5,000 on December 31, 2023 and June 30, 2024 in accordance with the Amended 2019 Credit Agreement.

LOCs are available in an amount not to exceed $ 7,500 .

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As of December 31, 2024, the Company had three LOCs outstanding leaving approximately $ 37,800 available.

The Revolver had $ 15,000 in outstanding borrowings as of December 31, 2023 and zero at December 31, 2022.

The Revolver had no outstanding borrowings as of December 31, 2024 and $ 15.0 million at December 31, 2023.

The Term Loan Facilities and Revolver permit the Company to elect either the secured overnight financial rate (“SOFR”) or base interest rate (“BR”) options for the entire amount or certain portions of the loans.

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The Company had one non-designated interest rate swap agreement that was terminated on October 28, 2022 and subsequently received $ 7,738 upon its termination.

The swap was carried at fair value on the balance sheet with changes in fair value recorded as interest income or expense within the consolidated statements of operations and comprehensive (loss) income.

Net interest income of $ 6,396 and $ 2,730 was recorded related to the change in fair value of the interest rate swap for the years ended December 31, 2022 and 2021, respectively.

The swap was carried at fair value on the balance sheet with changes in fair value recorded as interest income or expense within the consolidated statements of operations and comprehensive loss .

Net interest income of $ 6,396 was recorded related to the change in fair value of the interest rate swap for the year ended December 31, 2022.

Fair value measurements

There were no assets measured at fair value on a recurring basis and there were no liabilities valued at fair value using Level 1 inputs at December 31, 2023 and 2022.

The following table provides information for assets and liabilities measured at fair value on a recurring basis using Level 2 and Level 3 inputs:

There were no assets measured at fair value on a recurring basis and there were no liabilities valued at fair value using Level 1 or Level 2 inputs at December 31, 2024 and 2023.

The following table provides information for assets and liabilities measured at fair value on a recurring basis using Level 3 inputs:

December 31, 2024 December 31, 2023

Total Level 2 Level 3 Total Level 2 Level 3

Deferred Amount - Current (a)

$ — $ — $ — $ 117,615 $ — $ 117,615

Deferred Amount - Long Term (a)

— — — 79,269 — 79,269

CartiHeal Contingent Consideration (a)

— — — 67,251 — 67,251

Bioness Contingent Consideration 18,150 — 18,150 17,431 — 17,431

Total Level 3 Total Level 3

Current portion of contingent consideration $ 19,573 $ 19,573 $ — $ —

Contingent consideration — — 18,150 18,150

Total liabilities:

$ 19,573 $ 19,573 $ 18,150 $ 18,150

(a) The Deferred Amount and contingent consideration attributable to CartiHeal have been reclassified to discontinued operations within the December 31, 2022 balance sheet.

CartiHeal was fully deconsolidated during the first quarter of 2023.

Refer to Note 4.

Acquisitions and divestitures and Note 15.

Discontinued operations for further details regarding the deconsolidation of CartiHeal.

Deferred Amount

The Deferred Amount that resulted from the CartiHeal Acquisition was calculated based on the total amount payable on each due date for the payment tranches including applicable interest.

As previously discussed, the Company reached a Settlement Agreement with the Former Securityholders which relieved the Company of the obligations under the Deferred Amount.

Refer to Note 4.

Acquisitions and divestitures for further information.

Contingent consideration

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After the initial valuation, the Company generally uses its best estimate to measure contingent consideration at each subsequent reporting period using unobservable Level 3 inputs.

As previously discussed, the Company reached a Settlement Agreement with CartiHeal’s selling securityholders.

As a result of the Settlement Agreement, the Company was relieved of the CartiHeal Contingent Consideration obligations.

Refer to Note 4.

Acquisitions and divestitures for further information.

Unobservable inputs

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Valuation Technique Unobservable inputs Range

Bioness Contingent Consideration Discounted cash flow Payment discount rate 6.4 % - 6.8 %

Contingent consideration Discounted cash flow Payment discount rate 6.4 % - 6.8 %

Payment period 2025

Significant changes in these assumptions could result in a significantly higher or lower fair value.

The contingent consideration reported in the above table resulted from the Bioness Acquisition on March 30, 2021 and the CartiHeal Acquisition on July 12, 2022.

The contingent consideration reported in the above table resulted from the acquisition of Bioness, Inc.

(“Bioness”) on March 30, 2021 and is comprised of future earn-out payments contingent upon the achievement of certain research and development projects as well as sales milestones related to Bioness products.

Contingent consideration resulting from the acquisition of Bioness includes maximum earn-out payments of $ 50,000 as follows:

(i) $ 20,000 for meeting net sales targets for certain implantable products over a three year period ending on June 30, 2025 at the latest;

(ii) up to $ 10,000 for meeting net sales milestones for certain implantable products over a three year period ending on June 30, 2025 at the latest;

and (iii) $ 20,000 for maintaining Centers for Medicare & Medicaid Services coverage and reimbursement for certain products at specified levels as of December 31, 2024.

The Company met criteria (iii) as of December 31, 2024 and will make the related payment in the first half of fiscal year 2025.

Contingent consideration is adjusted quarterly based upon the passage of time or the anticipated success or failure of achieving certain milestones.

Changes in contingent consideration related to the Bioness Acquisition totaled $ 719 , $ 1,102 and $ 829 for the years ended December 31, 2023, 2022 and 2021, respectively, and were recorded as the change in fair value of contingent consideration within the consolidated statements of operations and comprehensive (loss) income.

Changes in contingent consideration related to the CartiHeal Acquisition totaled $ 1,710 and $ 5,350 for years ended December 31, 2023 and 2022, respectively and were recorded in discontinued operations, net of tax within the consolidated statements of operations and comprehensive (loss) income.

comprehensive loss.

Pursuant to the Settlement Agreement, the Company was relieved of CartiHeal related obligations.

The Company deconsolidated the remaining $ 68,961 contingent consideration liability as a result.

Refer to Note 4.

Acquisitions and divestitures for further details regarding the deconsolidation of CartiHeal.

Management incentive plan and liability-classified awards

BV LLC had operated two equity-based compensation plans, the management incentive plan (the “MIP”) and the BV LLC Phantom Profits Interest Plan (together with the MIP, the “Phantom Plans”), which were terminated on February 11, 2021 in connection with the Company’s IPO.

Awards granted under the MIP Plan and the 2015 Phantom Units were liability-classified and the 2012 Phantom Units were equity-classified.

Prior to the IPO and during the year ended December 31, 2021, the Company settled with the sole MIP awardee for $ 10,802 .

No awards under the Phantom Plans were granted post-IPO and the Phantom Plan awards were settled 12 months following the termination.

Vested awardees whose BV LLC employment terminated prior to the IPO had their awards settled in March 2022 for $ 10,413 .

Due to the changes in fair value for these awards granted prior to the Company’s IPO, compensation award activity from the Phantom Plans resulted in a net gain of $ 24,356 for the year ended December 31, 2021.

Changes in contingent consideration related to the Bioness Acquisition totaled $ 1,423 , $ 719 and $ 1,102 for the years ended December 31, 2024, 2023 and 2022, respectively, and were recorded as the change in fair value of contingent consideration within the consolidated statements of operations and comprehensive loss .

Equity-based compensation

Terminated plans

Prior to the Phantom Plans’ termination, during the year ended December 31, 2021, (i) the Company granted 90,000 Phantom Profits Interest Plan units;

(ii) there were no MIP awards granted;

(iii) 900 Phantom Profits Interest Plan units were forfeited;

and (iv) other Phantom Plan units were redeemed for $ 479 .

Compensation expense related to the Phantom Plans totaled $ 829 for the year ended December 31, 2021.

This amount excludes the $ 25,185 decrease in fair market value of accrued equity-based compensation due to adjustments to reflect the difference between the expected public offering price of the IPO and the actual offering price, of which $ 1,777 was recorded in research and development expense within the consolidated statements of operations and comprehensive (loss) income for the year ended December 31, 2021.

The Company operates an equity-based compensation plan (“2021 Plan”), which allows for the issuance of stock options (incentive and nonqualified), restricted stock, dividend equivalents, restricted stock units (“RSUs”), other stock-based awards, and cash awards (collectively, “Awards”).

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Equity-based compensation expense for Awards granted under the Plans and inducement awards for the years ended December 31, 2024, 2023 and 2022 totaled $ 9,613 , $ 2,370 and $ 17,114 , respectively.

The expense is primarily included in selling, general and administrative expense with a nominal amount in research and development expense on the consolidated statements of operations and comprehensive (loss) income based upon the classification of the employee.

The expense is primarily included in selling, general and administrative expense with a nominal amount in research and development expense on the consolidated statements of operations and comprehensive loss based upon the classification of the employee.

There were no income tax benefits related to equity-based compensation expense for the years ended December 31, 2024 and 2023.

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Exercisable and vested at December 31, 2024 1,816 $ 10.29 4.95 $ 1,624

The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the market price of the Company’s Class A common stock for options that had exercise prices lower than $ 5.27 per share, the closing price of the Company’s Class A common stock on December 29, 2023.

(1) The aggregate intrinsic value is based upon the difference between the Company’s closing stock price at the date of the consolidated balance sheets and the exercise price of the stock option for in-the-money stock options.

The intrinsic value of outstanding stock options fluctuates based upon the trading value of the Company’s Class A common stock.

Employee Stock Purchase Plan

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Company contributions totaled $ 6,715 , $ 5,836 , and $ 6,407 for all global plans during the years ended December 31, 2024, 2023 and 2022, respectively.

The expense is included in cost of sales, selling, general and administrative expense and research and development expense on the consolidated statement of operations and comprehensive (loss) income based upon the classification of the employee.

The expense is included in cost of sales, selling, general and administrative expense and research and development expense on the consolidated statement of operations and comprehensive loss based upon the classification of the employee.

Stockholders’ equity

Initial Public Offering

On February 16, 2021, the Company closed an IPO of 9,200,000 shares of Class A common stock at a public offering price of $ 13.00 per share, which includes 1,200,000 shares issued pursuant to the underwriters' over-allotment option.

The Company received $ 111,228 in proceeds, net of underwriting discounts and commissions of $ 8,372 , which was used to purchase newly-issued membership interests from BV LLC at a price per interest equal to the IPO price of $ 13.00 .

The Company also incurred offering expenses totaling $ 4,778 in addition to the underwriting discounts and commissions.

Offering expenses of $ 1,327 were paid in 2020 and $ 3,451 were paid in 2021.

The Company is the sole managing member of, has a majority economic interest in, has the sole voting interest in, and controls the management of BV LLC.

As a result, the Company consolidates the financial results of BV LLC and reports a non-controlling interest for the interest not held by the Company.

IPO Transactions

In connection with the IPO, the Company completed the following transactions (“Transactions”).

• Amended and restated the limited liability company agreement of BV LLC (“BV LLC Agreement”), to, among other things, (i) provide for a new single class of common membership interests in BV LLC (“LLC Interests”);

(ii) exchange all of the existing membership interests in BV LLC (“Original BV LLC Owners”) for new LLC Interests;

and (iii) appoint Bioventus Inc.

as the sole managing member of BV LLC.

• Amended and restated the Bioventus Inc.

certificate of incorporation to, among other things, (i) provide for an increase in the authorized shares of Class A common stock;

(ii) provide for Class B common stock with voting rights but no economic interest, which shares were issued to the Original BV LLC Owners on a one -for-one basis with the number of LLC Interests they owned;

and (iii) provide for undesignated preferred stock.

• Acquired, by merger, ten entities that were Original BV LLC Owners (“Former LLC Owners”), for which the Company issued 31,838,589 shares of Class A common stock as merger consideration (“IPO Mergers”).

The only assets held by the Former LLC Owners were 31,838,589 LLC Interests and a corresponding number of shares of Class B common stock.

Upon consummation of the IPO Mergers, the 31,838,589 shares of Class B common stock were canceled, and the Company recognized the 31,838,589 LLC Interests at carrying value, as the IPO Mergers are considered to be a recapitalization transaction.

The Company issued 15,786,737 shares of Class B common stock to the Original BV LLC Owners.

The financial statements for periods prior to the IPO and Transactions have been adjusted to combine the previously separate entities for presentation purposes.

Prior to the Transactions, Bioventus Inc.

had no operations.

Amendment and restatement of certificate of incorporation

On February 16, 2021, the Company amended and restated its certificate of incorporation to, among other things, provide for:

(i) the authorization of 250,000,000 shares of Class A common stock with a par value of $ 0.001 per share;

(ii) the authorization of 50,000,000 shares of Class B common stock with a par value of $ 0.001 per share;

(iii) the authorization of 10,000,000 shares of undesignated preferred stock that may be issued from time to time by the BOD in one or more series;

and (iv) the establishment of a classified BOD, divided into three classes, each of whose members will serve for staggered three-year terms.

Holders of Class A and Class B common stock are entitled to one vote per share and, except as otherwise required, will vote together as a single class on all matters on which stockholders generally are entitled to vote.

On February 16, 2021, the Company closed an IPO of 9,200,000 shares of Class A common stock through an UP-C structure with BV LLC.

In connection with the IPO, the Company amended and restated the limited liability agreement of BV LLC (“BV LLC Agreement”) to provide for a new single class of common membership interests in BV LLC (“LLC Interests”) and exchange all of the existing membership interests in BV LLC (the “Original BV LLC Owners”) for new LLC Interests.

The Company also amended its certificate of incorporation to authorize the following shares:

(i) 250,000,000 shares of Class A common stock with a par value of $ 0.001 per share;

(ii) 50,000,000 shares of Class B common stock with a par value of $ 0.001 per share, which have voting rights but no economic interest, and some of which were issued to the Original BV LLC Owners;

and (iii) 10,000,000 shares of undesignated preferred stock that may be issued from time to time by the Company’s board of directors.

In connection with the completion of the IPO, the Company acquired, by merger, certain entities that were part of the Original BV LLC Owners (“Former BV LLC Owners”), for which the Company issued 31,838,589 Class A common stock as merger consideration (“IPO Mergers”) and cancelled the Class B common stock held by such Former BV LLC Owners.

The IPO Mergers are deemed to be a recapitalization transaction.

Holders of the Company’s Class A and Class B common stock are entitled to one vote per share and, except as otherwise required, will vote together as a single class on all matters on which stockholders generally are entitled to vote.

Holders of Class B common stock are not entitled to receive dividends and will not be entitled to receive any distributions upon the liquidation, dissolution or winding up of the Company.

Shares of Class B common stock may only be issued to the extent necessary to maintain the one -to-one ratio between the number of LLC Interests and the number of shares of Class B common stock held by the Continuing LLC Owner.

(the “Continuing LLC Owner”).

Shares of Class B common stock are transferable only together with an equal number of LLC Interests.

Shares of Class B common stock will be canceled on a one -for-one basis upon the redemption or exchange of any outstanding LLC Interests.

BV LLC recapitalization

On February 16, 2021, the Company amended and restated the BV LLC Agreement to, among other things, (i) provide for new LLC Interests;

(ii) exchange all of the then existing membership interests of the Original BV LLC Owners for new LLC Interests;

and (iii) appoint Bioventus Inc.

as the sole managing member of BV LLC.

The BV LLC Agreement provides that holders of LLC Interests may, from time to time, require the Company to redeem all or a portion of their LLC Interests for newly-issued shares of Class A common stock on a one -for-one basis.

The Company may elect to settle any such redemption in shares of Class A common stock or in cash.

The amendment also requires that the Company, at all times, maintain (i) a one -to-one ratio between the number of outstanding shares of Class A common stock and the number of LLC Interests owned by the Company and (ii) a one -to-one ratio between the number of shares of Class B common stock owned by the Continuing LLC Owner and the number of LLC Interests owned by the Continuing LLC Owner.

Noncontrolling interest

In connection with any redemption of LLC Interests by the Continuing LLC Owner, the Company will receive a corresponding number of LLC Interests, increasing its ownership interest in BV LLC.

In connection with any redemption pursuant to the BV LLC Agreement, the Company will receive a corresponding number of LLC Interests, increasing its ownership interest in BV LLC.

Future redemptions of LLC Interests will result in a change in ownership and reduce the amount recorded as noncontrolling interest and increase additional paid-in capital.

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Earnings per share

The following table sets forth the computation of basic and diluted loss per share of Class A common stock for the periods presented (amounts in thousands, except share and per share data):

December 31, 2023 December 31, 2022 February 16, 2021 through the Year Ended December 31, 2021

The following table sets forth the computation of basic and diluted loss per share of Class A common stock (amounts in thousands, except share and per share data) for the years ending December 31:

2024 2023 2022

Net loss from continuing operations $ ( 43,833 ) $ ( 121,196 ) $ ( 144,651 )

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As such, separate presentation of basic and diluted losses per share of Class B common stock under the two-class method has not been presented.

The following number of weighted-average potentially dilutive shares as of December 31, 2023 and 2022 were excluded from the calculation of diluted loss per share because the effect of including such potentially dilutive shares would have been antidilutive upon conversion:

December 31, 2023 Year Ended

December 31, 2022 February 16, 2021 through the Year Ended December 31, 2021

The following number of weighted-average potentially dilutive shares were excluded from the calculation of diluted loss per share because the effect of including such potentially dilutive shares would have been antidilutive upon conversion for the years ending December 31:

2024 2023 2022

LLC Interests held by Continuing LLC Owner (a)

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RSUs 11,052 595,030 710,807

Unvested shares of Class A common stock — — 30,056

Total 18,087,225 22,242,283 24,177,324

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Restructuring costs are not allocated to the Company’s reportable segments as they are not part of the segment performance measures regularly reviewed by management.

These charges are included in restructuring costs in the consolidated statements of operations and comprehensive (loss) income.

These charges are included in restructuring costs in the consolidated statements of operations and comprehensive loss .

Liabilities associated from restructuring costs are recorded in accrued liabilities on the consolidated balance sheets.

The Company announced a restructuring plan in December 2022 (“2022 Restructuring Plan”) that was intended to align the Company’s organizational and management cost structure to improve profitability and cash flow.

The 2022 Restructuring Plan primarily consisted of employee severance and additional expenses for third-party and other related costs.

Pre-tax charges recognized during the year ended December 31, 2023 and 2022 totaled $ 793 and $ 4,581 , respectively.

The 2022 Restructuring Plan is complete.

The Company adopted restructuring plans for businesses acquired to reduce headcount, reorganize management structure and consolidate certain facilities during the second half of 2021 (“2021 Acquisition Restructuring Plan”) and during the first quarter of 2022 (“2022 Acquisition Restructuring Plan”).

The Company planned total pre-tax charges for the 2021 Acquisition Restructuring Plan and the 2022 Acquisition Restructuring Plan were $ 3,500 and $ 2,300 , respectively.

There was nominal activity related to the 2021 Acquisition Restructuring Plan during the year ended December 31, 2023, and $ 719 and $ 2,487 was recognized during the years ended December 31, 2022 and 2021, respectively.

The 2021 Acquisition Restructuring Plan is complete.

Costs attributable to the 2022 Acquisition Restructuring Plan totaled $ 84 and $ 1,479 during the years ended December 31, 2023 and 2022, respectively.

The Company’s prior restructuring plans adopted in 2021 and 2022 focused on aligning its organizational and management cost structure to improve profitability and cash flow, reduce headcount and consolidate facilities.

These plans have been completed.

There was a restructuring expense reversal of $ 52 during the year ended December 31, 2024 primarily due to employee transitions associated with the sale of the Advanced Rehabilitation Business.

Restructuring expenses totaled $ 840 and $ 6,779 during the years ended December 31, 2023 and 2022, respectively.

The Company’s restructuring charges and payments for plans related to businesses acquired comprised of the following:

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Balance at December 31, 2023 1,316 — 1,316

Expenses incurred 648 192 840

Expense reversal ( 52 ) — ( 52 )

Payments made ( 1,139 ) — ( 1,139 )

Balance at December 31, 2024 $ 125 $ — $ 125

As a result of the Transactions, Bioventus Inc.

became the sole managing member of BV LLC, which is treated as a partnership for income tax purposes.

Bioventus Inc.

is the sole managing member of BV LLC, which is treated as a partnership for income tax purposes.

As a partnership, BV LLC is not subject to United States federal and certain state and local income taxes.

Any taxable income or loss generated by BV LLC is passed through to and included in the taxable income or loss of its members, including the Company, following the Transactions, on a pro rata basis.

Prior to the Transactions, income from other domestic subsidiaries included BV LLC and thereafter is included in income from domestic taxable subsidiaries.

The components of (loss) income before income taxes for the years ended December 31 are as follows:

Any taxable income or loss generated by BV LLC is passed through to and included in the taxable income or loss of its members, including the Company, on a pro rata basis.

The components of loss before income taxes for the years ended December 31 are as follows:

2024 2023 2022

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International 10,322 4,565 ( 1,454 )

(Loss) income before income taxes - continuing operations $ ( 121,111 ) $ ( 189,025 ) $ 9,488

Loss before income taxes - continuing operations $ ( 49,126 ) $ ( 121,111 ) $ ( 189,025 )

The provision for income taxes on operations consists of the following for the years ended December 31:

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Total deferred ( 5,394 ) ( 2,377 ) ( 46,666 )

Total income tax expense (benefit) - continuing operations $ 85 $ ( 44,374 ) $ ( 1,966 )

Total income tax (benefit) expense - continuing operations $ ( 5,293 ) $ 85 $ ( 44,374 )

Cash paid for income taxes totaled $ 1,341 , $ 2,955 and $ 1,518 for the years ended December 31, 2024, 2023 and 2022, respectively.

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Total deferred tax assets 4,745 840

Deferred tax liability:

Investment in Bioventus LLC — 26,814

Deferred income tax liabilities:

Intangibles 564 2,053

Gross deferred tax liability 2,053 29,241

Net deferred tax liability $ 1,213 $ 2,248

The valuation allowance is primarily attributable to net operating losses (“NOLs”).

Gross deferred income tax liabilities 564 2,053

Net deferred tax (asset) liability $ ( 4,181 ) $ 1,213

The Company considered many factors when assessing the likelihood of future realization of these deferred tax assets, including expectations of future taxable income or loss, the carryforward periods available to the Company for tax reporting purposes, and other relevant factors.

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Beginning in 2022, the Tax Cuts and Jobs Act of 2017 eliminated the option to deduct research and development expenditures immediately in the year incurred and requires companies to amortize such expenditures over five or fifteen years for tax purposes, depending on whether the activities were incurred in the United States or outside of the United States.

This change resulted in an increase to gross deferred tax assets and cash tax liabilities.

This change resulted in an increase to gross deferred tax assets and cash tax liabilities in 2023 and 2024.

As of December 31, 2024, the Company had approximately $ 33,720 in U.S.

federal NOL carryforwards at its corporate subsidiaries and $ 1,213 in federal tax credits.

federal NOL carryforwards and $ 1,153 in federal tax credits.

Certain US federal NOL carryforwards begin to expire in 2031, while others were generated after the enactment of the Tax Cuts and Jobs Act (the “Act”) and as such do not expire, but can only be utilized to offset up to 80% of taxable income in any given year.

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In general, the tax years 2021 - 2024 remain open to examination by the major jurisdictions in which the Company is subject to tax.

A reconciliation of the gross unrecognized tax benefits (excluding interest and penalties) for the year ended December 31, 2023 follows:

A reconciliation of the gross unrecognized tax benefits (excluding interest and penalties) for the years ended December 31:

Beginning of the period $ 4,725 $ 5,883

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The Company also leases certain office equipment under nominal finance leases.

The remaining lease terms range from 1 month to 8.3 years.

Lease assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease.

8 unchanged sentences

Additionally, lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise the option.

The Company leases its office facilities as well as other property, vehicles and equipment under operating leases.

The Company also leases certain office equipment under nominal finance leases.

The remaining lease terms range from 1 month to 9.33 years.

The components of lease cost were as follows for the years ended December 31:

17 unchanged sentences

Supplemental balance sheet and other information related to operating leases were as follows for the years ended December 31:

Operating lease assets $ 13,353 $ 16,690

Operating lease liabilities- current $ 4,057 $ 3,552

Operating lease liabilities- noncurrent 10,573 14,355

Operating lease assets (a)

$ 6,506 $ 13,353

Operating lease liabilities - other current liabilities $ 3,102 $ 4,057

Operating lease liabilities - other long-term liabilities 6,940 10,573

Total operating lease liabilities $ 10,042 $ 14,630

1 unchanged sentence

Property, plant and equipment - net $ 12,703 $ 14,279

Finance lease liabilities - current $ 759 $ 55

Finance lease liabilities - noncurrent 10,386 76

Finance lease liabilities - other current liabilities $ 815 $ 759

Finance lease liabilities - other long-term liabilities 9,571 10,386

Total financing lease liabilities $ 10,386 $ 11,145

5 unchanged sentences

Finance leases 8.1 % 8.1 %

(a) As previously discussed in Note 2.

Significant accounting policies , the Company incurred an impairment of right-of-use assets totaling $ 2,456 during the year ended December 31, 2024.

Future maturities of operating and finance lease liabilities are as follows:

21 unchanged sentences

In the opinion of management, the outcome of any existing claims and legal or regulatory proceedings, other than the specific matters described below, if decided adversely, is not expected to have a material adverse effect on the Company’s business, financial condition, results of operations, or cash flows.

Bioventus stockholder litigation

On January 12, 2023, the Company and certain of its current and former directors and officers were named as defendants in a putative class action lawsuit filed in the Middle District of North Carolina, Ciarciello v.

Bioventus, Inc., No.

Bioventus shareholder litigation

Bioventus Inc.

1:23– CV – 00032-CCE-JEP (M.D.N.C.

The complaint asserts violations of Sections 10(b) and 20(a) of the Exchange Act and of Sections 11 and 15 of the Securities Act and generally alleges that the Company failed to disclose certain information regarding rebate practices, its business and financial prospects, and the sufficiency of internal controls regarding financial reporting.

The complaint asserted violations of Sections 10(b) and 20(a) of the Exchange Act and of Sections 11 and 15 of the Securities Act and generally alleges that the Company failed to disclose certain information regarding rebate practices, its business and financial prospects, and the sufficiency of internal controls regarding financial reporting.

The complaint seeks damages in an unspecified amount.

5 unchanged sentences

The Court dismissed the plaintiff’s Securities Act claims, but allowed the plaintiff’s Exchange Act claims to proceed into discovery.

On July 15, 2024, a Stipulation and Agreement of Settlement (the “Settlement Agreement”) by and between the lead plaintiff and the defendants was filed with the Court, and the Court preliminarily approved the Settlement Agreement on August 13, 2024.

The Court entered judgment on December 18, 2024, granting final approval of the terms of the Settlement Agreement and dismissing all claims against the defendants, including the Company.

The parties settled without any admission of liability or wrongdoing by any party.

The settlement amount of $ 15,250 , together with interest earned thereon, has been paid by the defendants and/or the defendant’s insurers.

The Company incurred $ 13,802 of net shareholder litigation costs (including estimated settlement and reimbursement) during the year ended December 31, 2024 under the Settlement Agreement, which were recorded in selling, general and administrative expense within the consolidated condensed statements of operations and comprehensive loss.

On October 4, 2023, certain of the Company’s current and former directors and officers were named as defendants in a derivative shareholder lawsuit (in which the Company is a nominal defendant) filed in the United States District Court for the District of Delaware, Grogan, on behalf of Bioventus Inc., v.

Reali, et.al., No.

Reali, et al.

1:23-CV-01099-RGA (D.

1 unchanged sentence

On January 12, 2024, the Court agreed to stay this case pending resolution of the Ciarciello case.

On February 9, 2024, another plaintiff filed a derivative shareholder lawsuit against certain of the Company’s current and former directors and officers (in which the Company is a nominal defendant) filed in the United States District Court for the District of Delaware, Sanderson, on behalf of Bioventus Inc., v.

Reali, et.al., No.

1:24-cv-00180-RGA (D.

Like the Grogan case, this case asserts violations of Section 10(b) of the Exchange Act, breaches of fiduciary duties and related state law claims, and a claim for contribution, and generally alleges the same purported misconduct as alleged in the Ciarciello case.

The parties are in discussions to consolidate the two derivative matters and stay them on terms similar to those entered in the Grogan case.

The Company believes the claims alleged in each of the above matters lack merit and intends to defend itself vigorously.

The outcome of these matters is not presently determinable, and any loss is neither probable nor reasonably estimable.

Misonix former distributor litigation

On March 23, 2017, Misonix’s former distributor in China, Cicel (Beijing) Science & Technology Co., Ltd., filed a lawsuit against Misonix and certain of its officers and directors in the United States District Court for the Eastern District of New York.

The complaint alleged that Misonix improperly terminated its contract with the former distributor.

The complaint sought various remedies, including compensatory and punitive damages, specific performance and preliminary and post judgment injunctive relief, and asserted various causes of action, including breach of contract, unfair competition, tortious interference with contract, fraudulent inducement, and conversion.

On October 7, 2017, the court granted Misonix’s motion to dismiss each of the tort claims asserted against Misonix, and also granted the individual defendants’ motion to dismiss all claims asserted against them.

On January 23, 2020, the court granted Cicel’s motion to amend its complaint, to include claims for alleged defamation and theft of trade secrets in addition to the breach of contract claim.

Discovery in the matter ended on August 5, 2021.

On January 20, 2022, the court granted Misonix’s summary judgment motion on Cicel’s breach of contract and defamation claims.

Cicel’s motion for reconsideration of the court’s summary judgment ruling in Misonix’s favor was dismissed by the Court on April 29, 2022.

On July 18, 2022, Cicel voluntarily dismissed the remaining claim for trade secret theft and later filed an appeal to the United States Court of Appeals for the Second Circuit.

On March 6, 2024, the Second Circuit Court of Appeals issued its ruling affirming the lower Court’s summary judgment in favor of Misonix in all respects.

Bioness stockholder litigation

On February 8, 2022, a minority shareholder of Bioness filed an action in the Delaware State Court of Chancery in connection with the Company’s acquisition of Bioness, Teuza, a Fairchild Technology Venture Ltd.

2022-0130 -SG.

This action names the former Bioness directors, the Alfred E.

Mann Trust (Trust), which was the former majority shareholder of Bioness, the trustees of the Trust and Bioventus as defendants.

The complaint alleges, among other things, that the individual directors, the Trust, and the trustees breached their fiduciary duty to the plaintiff in connection with their consideration and approval of the Company’s transaction.

The complaint also alleges that the Company aided and abetted the other defendants in breaching their fiduciary duties to the plaintiff and that the Company breached the Merger Agreement by failing to pay the plaintiff its pro rata share of the merger consideration.

The Company believes that it is indemnified under the indemnification provisions contained in the Bioness Merger Agreement for these claims.

On July 20, 2022, the Company filed a motion to dismiss all claims made against it on various grounds, as did all the other named defendants in the suit.

A hearing on Bioness’ and other the defendant’s motions was held before the Court of Chancery on January 19, 2023.

On April 27, 2023, the Court issued an order which, among other things, dismissed Bioventus from the cas e.

On May 1, 2024, the parties filed a stipulation to consolidate the two derivative matters and stay them on terms similar to those entered in the Grogan case.

On May 2, 2024, the United States District Court for the District of Delaware granted the stipulation and ordered the consolidation of the Sanderson and Grogan cases, captioned In re Bioventus Inc.

Derivative Litigation , Case No.:

1:23-cv-01099-RGA.

The Court also stayed the consolidated case.

Following resolution of the Ciarciello case, on December 30, 2024, the plaintiffs in the consolidated case filed an amended complaint asserting the same claims as in the Grogan case against certain of the Company’s current and former directors and officers.

On January 6, 2025, the Court entered a scheduling order, under which the defendants had until March 3, 2025 to file a motion to dismiss the amended complaint.

On February 21, 2025, the parties submitted a joint stipulation to stay the proceedings to allow the parties time to negotiate a settlement, which the company expects to be in the form of governance reforms.

On July 31, 2024, another plaintiff filed a derivative complaint against certain of the Company’s current and former officers and directors, in which Bioventus is a nominal defendant only, in the United States District Court for the Middle District of North Carolina, captioned Vince v.

1:24-cv-006390CCEJEP (M.D.N.C.

Like the Gorgan case, the Vince case asserts violations of Section 14(a) of the Exchange Act, breaches of fiduciary duties, unjust enrichment, contribution, and waste, and generally alleges the same purported misconduct as alleged in the Ciarciello case.

On November 11, 2024, the defendants filed a motion to transfer the Vince case to the United States District Court for the District of Delaware, pursuant to the forum selection clause in Bioventus’s certificate of incorporation.

On January 14, 2025, the Court granted the motion and transferred the Vince case to the District of Delaware.

On February 14, 2025, the plaintiff requested voluntary dismissal of the Vince case without prejudice and the Court granted the request that same day.

On February 20, 2025, plaintiff Jeffrey Vince refiled a Verified Stockholder Derivative Complaint against certain of Bioventus’ current and former officers and directors, naming Bioventus as a nominal defendant only, in Delaware Chancery Court, captioned Jeffrey Vince v.

Reali et al ., C.A.

2025-0192-LWW (Del.

Like his prior complaint, which he voluntarily dismissed, Vince asserts breaches of fiduciary duties, unjust enrichment, contribution, and waste, and generally alleges the same purported misconduct as alleged in the Ciarciello case.

The Defendants have not yet been served.

On February 26, 2025, plaintiff James Bouchereau filed a Verified Stockholder Derivative Complaint against certain of Bioventus’s current and former officers and directors, naming Bioventus as a nominal defendant only, in Delaware Chancery Court, captioned James Bouchereau v.

Reali et al ., C.A.

2025-___-___ (Del.

The complaint is identical to the Vince complaint and asserts breaches of fiduciary duties, unjust enrichment, contribution, and waste, and generally alleges the same purported misconduct as alleged in the Ciarciello case.

The Defendants have not yet been served.

On February 6, 2025, purported stockholder Jae Hyung Jung served a litigation demand, requesting that the Board take action against certain directors and officers for alleged breaches of fiduciary duties, gross mismanagement, unjust enrichment, waste, aiding and abetting in connection with the same conduct at issue in the litigations.

On February 7, 2025, the same purported stockholder, Jung, served a settlement demand, requesting that the Company adopt certain corporate governance reforms and agree to certain monetary payments.

The Company has not yet responded to either demand.

The Company believes the claims alleged in the above derivative matters lack merit and intends to defend itself vigorously.

Except as described above, the outcomes of these matters are not presently determinable, and any loss is neither probable nor reasonably estimable.

Other matters

On November 10, 2021, the Company entered into an asset purchase agreement for a hyaluronic acid (“HA”) product and made an upfront payment of $ 853 .

If the Company is able to obtain a Medical Device Regulation Certification for the product $ 1,707 (the “Milestone Payment”) will be paid to the seller within five days .

The Company is also required to pay royalties if certifications are achieved before December 31, 2024.

Royalties will be payable through 2026 of 5.0 % on the first $ 569 in sales and 2.5 % thereafter.

On March 8, 2023, the parties amended the agreement under which the Milestone Payment was reduced to $ 1,418 , of which $ 709 was paid on January 31, 2024, and the remainder is due upon receipt of the Medical Device Regulation Certification for the product provided that is obtained prior to December 31, 2024.

As a result, the Company recorded an intellectual property intangible asset totaling $ 709 for the initial payment.

On May 29, 2019, the Company and the Musculoskeletal Transplant Foundation, Inc.

d/b/a MTF Biologics (“MTF”), entered into a collaboration and development agreement to develop one or more products for orthopedic application to be commercialized by the Company and supplied by MTF (the “Development Agreement”).

The first phase has been completed, but during the second quarter of 2022, the Company elected to discontinue the development of MOTYS, the initial product candidate under development.

On October 21, 2022, the Company provided notice to MTF of termination of the Development Agreement and the related cGTP Commercial Supply Agreement with MTF for MOTYS, effective December 20, 2022.

On November 10, 2021, the Company entered into an asset purchase agreement for an HA product and made an upfront payment of $ 853 .

An additional payment of $ 853 was made in 2022 upon the transfer of certain seller customer data.

If the Company is able to obtain a Medical Device Regulation Certification (“MDR Certification”) for the product, $ 1,707 (the “Milestone Payment”) will be paid to the seller within five days.

On March 8, 2023, the parties amended the agreement under which the Milestone Payment was reduced to $ 1,418 , of which $ 709 was recorded as an intellectual property intangible asset during 2023 and was paid on January 31, 2024.

The remainder was due upon receipt of the MDR Certification for the product provided that it was obtained prior to December 31, 2024, which was not achieved.

The asset purchase agreement was further amended in 2024 acknowledging the expectation that the MDR Certification would not be obtained.

Pursuant to the amendment in 2024, the MDR Certification achievement criteria under the asset purchase agreement was extended for two years.

On December 9, 2016, the Company entered into an amended and restated license agreement for the exclusive U.S.

2 unchanged sentences

Royalties related to this agreement during the years ended December 31, 2024, 2023 and 2022 totaled $ 18,764 , $ 14,035 and $ 14,712 , respectively.

These royalties are included in cost of sales within the consolidated statements of operations and comprehensive (loss) income.

These royalties are included in cost of sales within the consolidated statements of operations and comprehensive loss .

As part of a supply agreement entered on February 9, 2016 and subsequently amended for the Company’s three-injection OA product, the Company is subject to annual minimum purchase requirements for 10 years.

1 unchanged sentence

As part of a supply agreement for the Company’s five-injection OA product that was amended and restated on December 22, 2020, the Company is subject to annual minimum purchase requirements for 8 years.

The Company has an exclusive license agreement for bioactive bone graft putty.

The Company is required to pay a royalty on all commercial sales revenue from the licensed products with a minimum annual royalty payment through 2023, the date the agreement will expire, upon the expiration of the patent held by the licensor.

These royalties are included in cost of sales on the consolidated statements of operations and comprehensive (loss) income.

From time to time, the Company causes letters of credit (“LOCs”) to be issued to provide credit support for guarantees, contractual commitments and insurance policies.

The fair values of the LOCs reflect the amount of the underlying obligation and are subject to fees payable to the issuers, competitively determined in the marketplace.

As of December 31, 2023 the Company had three LOCs outstanding for $ 1,800 and as of December 31, 2022, the Company had one LOC outstanding for a nominal amount.

As of December 31, 2024 the Company had three LOCs outstanding for $ 2,200 and as of December 31, 2023, the Company had three LOC outstanding for $ 2,200 .

The Company currently maintains insurance for risks associated with the operation of its business, provision of professional services and ownership of property.

5 unchanged sentences

and to all foreign countries based on the legal entity from which the sale originated.

Refer to Note 2.

Significant accounting policies for further information regarding revenue recognition.

As previously discussed in Note 1.

Organization, SonicOne revenue was reclassified from Restorative Therapies to Surgical Solutions on a retrospective basis as its capabilities to remove devitalized or necrotic tissue and fiber deposits more closely align with Surgical Solutions’ soft tissue management.

SonicOne revenue reclassified for the year ended December 31, 2023 and 2022 totaled $ 6,833 and $ 6,845 , respectively, for the U.S.

reporting segment and $ 299 and $ 281 , respectively, for the International reporting segment.

The Company had product sales to one customer totaling $ 59,742 primarily in the U.S.

reporting segment during the year ended December 31, 2024, representing 10.4 % of total net sales.

There were no customers representing 10% or more of net sales during the years ended December 31, 2023 and 2022.

The following table presents the Company’s net sales disaggregated by major products within each segment as follows for the years ended December 31:

2 unchanged sentences

$ 234,936 $ 197,954 $ 194,830

Restorative Therapies 116,851 134,214 103,009

Surgical Solutions 167,706 141,888 133,052

Restorative Therapies 104,167 110,018 127,369

net sales 506,809 449,860 455,251

2 unchanged sentences

26,353 22,847 21,495

Restorative Therapies 20,222 20,420 18,563

Surgical Solutions 21,549 19,715 15,232

Restorative Therapies 18,569 19,923 20,139

Total International net sales 66,471 62,485 56,866

Total net sales $ 573,280 $ 512,345 $ 512,117

The Company’s two reportable segments are U.S.

and International.

The Company’s products are primarily sold to orthopedists, musculoskeletal and sports medicine physicians, podiatrists, neurosurgeons and orthopedic spine surgeons, as well as to their patients.

The Company does not disclose segment information by asset, nor does it disclose transactions between reportable segments, as the CODM does not review or use it to allocate resources or to assess the operating results and financial performance.

Transactions between reportable segments are executed in accordance with our transfer pricing arrangements and are eliminated in consolidation and not presented in the measures below.

Segment adjusted EBITDA is the segment profitability metric reported to the Company’s CODM for purposes of decisions about allocation of resources to, and assessing performance of, each reportable segment.

The following table presents segment adjusted EBITDA reconciled to (loss) income before income taxes for the years ended December 31:

As previously discussed in Note 2.

Significant accounting policies—Accounting pronouncements recently adopted, the Company adopted the provisions of ASU 2023-07, which required enhanced disclosures concerning significant segment expenses that are provided to the CODM and included within each measure of segment profit or loss.

The Company identifies a business as an operating segment if (i) it engages in business activities from which it may earn revenues and incur expenses;

(ii) its operating results are regularly reviewed by the CODM and (iii) it has available discrete financial information.

The Company’s CODM is its President and Chief Executive Officer, who uses Segment adjusted EBITDA to make decisions regarding the allocation of resources, assess performance and to develop annual budgets and forecasts.

The Company’s two operating segments are U.S.

and International, which also represent its reportable segments.

Both segments sell the Company’s portfolio of products to healthcare institutions, physicians, patients, distributors and dealers.

The Company does not disclose segment information by asset, as the CODM does not review or use it to allocate resources or to assess the operating results and financial performance.

The following table presents segment adjusted EBITDA reconciled to loss before income taxes for the years ended December 31:

December 31, 2024

International Consolidated

Revenue $ 506,809 $ 66,471 $ 573,280

Adjusted cost of sales (a)

118,985 24,188

Segment adjusted EBITDA

Adjusted selling expense (b)

157,789 11,233

International 10,194 12,097 9,915

Adjusted marketing expense (b)

Adjusted general and administrative expense (b)

97,592 14,949

Adjusted research and development expense (c)

Adjusted other segment income (d)

( 352 ) ( 405 )

Adjusted EBITDA 95,421 13,461 108,882

Reconciliation to loss before income taxes

Interest expense, net ( 38,792 )

1 unchanged sentence

Acquisition and related costs ( 1,339 )

Shareholder litigation costs ( 13,802 )

Restructuring and succession charges 57

Equity compensation ( 2,722 ) ( 17,585 ) 4,512

Equity-based compensation ( 10,058 )

Financial restructuring costs ( 351 )

Impairments of assets ( 36,357 )

Impairment of goodwill — ( 124,697 ) —

Loss on disposal of a business ( 292 )

Impairments related to variable interest entity — — ( 7,043 )

Other items ( 13,740 ) ( 8,465 ) ( 5,940 )

(Loss) income before income taxes $ ( 121,111 ) $ ( 189,025 ) $ 9,488

Other items (e)

Loss before income taxes $ ( 49,126 )

December 31, 2023

International Consolidated

Revenue $ 449,860 $ 62,485 $ 512,345

Adjusted cost of sales (a)

109,889 25,760

Adjusted selling expense (b)

140,278 11,908

Adjusted marketing expense (b)

Adjusted general and administrative expense (b)

86,108 12,285

Adjusted research and development expense (c)

Adjusted other segment income (d)

( 942 ) ( 348 )

Adjusted EBITDA 78,668 10,194 88,862

Reconciliation to loss before income taxes

Interest expense, net ( 40,676 )

Depreciation and amortization ( 57,365 )

Acquisition and related costs ( 5,694 )

Restructuring and succession charges ( 2,331 )

Equity-based compensation ( 2,722 )

Financial restructuring costs ( 7,291 )

Impairments of assets ( 78,615 )

Loss on disposal of a business ( 1,539 )

Other items (e)

Loss before income taxes $ ( 121,111 )

December 31, 2022

International Consolidated

Revenue $ 455,251 $ 56,866 $ 512,117

Adjusted cost of sales (a)

109,961 19,847

Adjusted selling expense (b)

147,772 11,291

Adjusted marketing expense (b)

Adjusted general and administrative expense (b)

93,565 10,397

Adjusted research and development expense (c)

Adjusted other segment (income) expense (d)

( 1,047 ) 534

Adjusted EBITDA 56,513 12,097 68,610

Reconciliation to loss before income taxes

Interest expense, net ( 12,021 )

Depreciation and amortization ( 55,398 )

Acquisition and related costs ( 21,731 )

Restructuring and succession charges ( 7,453 )

Equity-based compensation ( 17,585 )

Impairment of assets ( 10,285 )

Impairment of goodwill ( 124,697 )

Other items (e)

Loss before income taxes $ ( 189,025 )

(a) Adjusted cost of sales used in calculating segment Adjusted EBITDA excludes depreciation and amortization as well as the amortization of inventory step-up resulting from acquisitions.

(b) Adjusted selling, general and administrative expense used in the calculation of segment Adjusted EBITDA excludes certain acquisition and related costs, shareholder litigation costs, certain restructuring and succession charges, asset impairments, financial restructuring costs, equity-based compensation expense and other segment items—charges associated with strategic transactions, such as potential acquisitions or divestitures and transformative project to redesign systems and information processing projects.

(c) Adjusted research and development expense used in calculating segment Adjusted EBITDA excludes depreciation and amortization, equity-based compensation expense and other items—charges associated with the discontinuance of MOTYS and certain regulatory costs.

(d) Adjusted other segment (income) expense primarily consists of foreign currency transaction and remeasurement gains and losses and other certain nonrecurring items.

Activity excluded for the year ended December 31, 2024 included previously unrealized foreign currency gains within the International segment resulting from the sale of the Advanced Rehabilitation Business.

There were no excluded costs relating to other (income) expense during the year ended December 31, 2023.

Costs excluded for the year ended December 31, 2022 included an impairment related to the investment in Trice Medical Inc.

within the U.S.

(e) Other items primarily include charges associated with strategic transactions, such as potential acquisitions or divestitures and a transformative project to redesign systems and information processing.

During the year ended December 31, 2024, other items primarily consisted of divestiture costs related to the Company’s Advanced Rehabilitation Business, including transactional fees, transformative project costs and strategic transaction costs.

During the year ended December 31, 2023, other items mostly consisted of strategic transaction costs, transformative project costs, transition and severance costs and expenses related to the discontinuance of MOTYS.

During the year ended December 31, 2022, other items primarily consisted of costs related to the discontinuance of MOTYS, strategic transaction costs and public company preparation costs .

Discontinued operations

On February 27, 2023 the Company reached a Settlement Agreement with the Former Securityholders of CartiHeal that resulted in the transfer of 100 % of Company’s shares in CartiHeal to a Trustee.

On February 27, 2023 the Company reached a Settlement Agreement with the Former Securityholders of CartiHeal that resulted in the transfer of 100 % of the Company’s shares in CartiHeal to a Trustee.

Refer to Note 4.

Acquisitions and divestitures for further details concerning the CartiHeal Settlement Agreement and its deconsolidation from the Company’s financial statements.

CartiHeal had no sales for the year ended December 31, 2022 and December 31, 2023.

The following table summarizes CartiHeal’s major classes of assets and liabilities as reported on the consolidated balance sheets as of December 31, 2022 as the balances were fully deconsolidated as of December 31, 2023:

December 31, 2022

Carrying amounts of major classes of assets included as part of discontinued operations

Restricted cash 23

Other receivables 350

Inventory 642

Prepaid and other current assets 134

Current assets attributable to discontinued operations 2,777

Property and equipment, net 191

Goodwill 6,297

Intangible assets, net 398,873

Operating lease assets 618

Other assets 15

Long-term assets attributable to discontinued operations 405,994

Total assets attributable to discontinued operations $ 408,771

Carrying amounts of major liabilities included as part of discontinued operations

Accounts payable $ 852

Accrued liabilities 384

Current portion of deferred consideration 117,615

Other current liabilities 236

Current liabilities attributable to discontinued operations 119,087

Deferred income taxes 79,863

Deferred consideration 79,269

Contingent consideration 67,251

Other long-term liabilities 2,528

Long-term liabilities attributable to discontinued operations 228,911

Total liabilities attributable to discontinued operations $ 347,998

CartiHeal had no sales for the years ended December 31, 2023 and 2022.

The following table summarizes the major income and expense line items of these discontinued operations, as reported in the consolidated statements of operations for the years ended December 31:

2023 2022 2021

Selling, general and administrative expense $ 1,728 $ 472

1 unchanged sentence

Change in fair value of contingent consideration (a)

1,710 5,350 —

Depreciation and amortization (a)

4,264 11,405 —

Impairments of assets — 64,500

1 unchanged sentence

Interest expense, net (a)

4,889 13,774 —

Other expense (income) (b)

4 unchanged sentences

Net loss from discontinued operations ( 74,429 ) ( 68,740 )

Loss attributable to noncontrolling interest —

discontinued operations 14,937 13,955 —

Net loss attributable to Bioventus Inc.

discontinued operations $ ( 59,492 ) $ ( 54,785 ) $ ( 1,868 )

Loss attributable to noncontrolling interest—discontinued operations 14,937 13,955

Net loss attributable to Bioventus Inc.—discontinued operations $ ( 59,492 ) $ ( 54,785 )

(a) Depreciation and amortization, the change in fair value of contingent consideration and interest expense represent the significant operating non-cash items of discontinued operations.

1 unchanged sentence

Total investing cash outflows included these non-refundable payments and $ 1,356 cash on hand at disposal.

Subsequent events

As disclosed in Note 5.

Financial Instruments , the Company amended the 2019 Credit Agreement on January 18, 2024 to further modify certain financial covenants applicable to borrowings under the 2019 Credit Agreement.

Financial instruments .

Changes in and Disagreements with Accountants on Accounting and Financial Disclosures.

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