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There has been a steady level of recognition by regulatory and academic institutions of the role that modeling and simulation can play in the biopharmaceutical development and approval process, as demonstrated by regulations and guidance documents describing and encouraging the use of modeling and simulation in the biopharmaceutical discovery, development, testing and approval process, which has directly led to an increase in the demand for our services.
−Removed: Nonetheless, significant changes in government or regulatory policy, or a reversal in the level of adoption and reliance upon in silico data (trials, studies, or experiments conducted via computer or computer simulation) in the drug approval process, could result in the decrease in demand for our products and services or lead regulatory authorities to cease use of, or to recommend against the use of, our products and services.
+Added: Nonetheless, significant changes in government or regulatory policy, levels of government or academic funding or program support, or a reversal in the level of adoption and reliance upon in silico data (trials, studies, or experiments conducted via computer or computer simulation) in the drug approval process, could result in a decrease in demand for our products and services or lead regulatory authorities to cease use of, or to recommend against the use of, our products and services.
These factors, in turn, could ultimately have a material adverse effect on our business, financial condition and results of operations.
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Our software products are used in many academic institutions, often free of charge, where students, including PhD candidates, are first exposed to the types of tools and models that we offer.
−Removed: Upon graduating, these students frequently become employed by biopharmaceutical companies, where
−Removed: they may continue to use our products and advocate for their continued use.
−Removed: If academic institutions decide to use competitive products, develop their own biosimulation products, or reduce their exposure to biosimulation tools in general, familiarity with our products by the future generations of pharmacometricians and clinical pharmacologists may be diminished, which could ultimately result in a reduction in demand for our products over time.
+Added: Upon graduating, these students frequently become employed by biopharmaceutical companies, where they may continue to use our products and advocate for their continued use.
+Added: If academic institutions decide to use competitive products, develop their own biosimulation products, or reduce their exposure to biosimulation tools in general, whether as a result of change in approach or lack of funding or institutional support, familiarity with our products by the future generations of pharmacometricians and clinical pharmacologists may be diminished, which could ultimately result in a reduction in demand for our products over time.
We compete in a competitive and highly fragmented market.
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Any material decrease in demand for our technologies or services may have a material adverse effect on our business, financial condition and results of operations.
−Removed: Changes or delays in government regulation, executive action or administrative decision-making relating to the biopharmaceutical industry could decrease the need for some of the services we provide.
+Added: Changes or delays in government regulation, executive action or administrative decision-making relating to the biopharmaceutical industry have decreased and could continue to decrease the need for some of the services we provide.
Governmental agencies throughout the world strictly regulate the biopharmaceutical development process.
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New or amended regulations could result in higher regulatory standards and potentially additional revenues for companies that service these industries.
−Removed: However, some changes in regulations, such as a relaxation in regulatory requirements or the introduction of streamlined or expedited approval procedures, or an increase in regulatory requirements that we have difficulty satisfying or that make our regulatory strategy services less competitive, could eliminate or substantially reduce the demand for our regulatory services.
+Added: However, some changes in regulations, such as a relaxation in regulatory requirements, the introduction of streamlined or expedited approval procedures, an increase in regulatory requirements that we have difficulty satisfying or that make our regulatory strategy services less competitive, or governmental agency decisions not to review certain types of new drug applications, such as vaccines have reduced and could eliminate or substantially reduce the demand for our regulatory services.
Regulatory developments that could potentially increase demand for our services could also be postponed or not fully implemented.
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There continue to be business and operational variables across regions and changes in governments that may adopt different strategies and priorities in approaches to the regulation of the biopharmaceutical industry.
−Removed: The biopharmaceutical industry may experience a change in the traditional approaches to government support and funding for drug development, in particular for public sector and academic organizations, dependent on outside funding to develop early-stage research.
+Added: For example, in the past year, there has been a general pulling back of government support and funding for drug development, in particular for public sector and academic organizations, dependent on outside funding to develop early-stage research.
Any material decrease or delay in demand for our technologies or services, or regulatory restrictions or requirements placed on them, may have a material adverse effect on our business, results of operations and financial condition.
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If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, our business may be harmed.
−Removed: Reduction in R&D spending by our customers for a variety of reasons, as well as delays in the drug discovery and development process, may reduce demand for our products and services and negatively impact our results of operations and financial condition.
+Added: Reduction in R&D spending by our customers for a variety of reasons, including due to lack of funding, as well as delays in the drug discovery and development process, have reduced and may continue to reduce demand for our products and services and negatively impact our results of operations and financial condition.
We provide biosimulation software platforms and services to the biopharmaceutical industry, including both private and public companies, as well as government and academic institutions.
Because our products and services often depend on our customers’ R&D expenditures, our revenues may be materially negatively affected by any economic, competitive, regulatory, demand, or other market impact that decreases our customers’ financial performance, access to funds or their ability to raise capital, which may cause them to decrease or delay R&D spend.
−Removed: In such an event, our revenues may be reduced through increased downward pricing pressure, reduction in the scope of projects, delays or cancellations of ongoing projects, or our customers shifting away from using third parties for their modeling and simulation work.
−Removed: Our customers’ expenses and obligations could continue to increase as a result of the higher costs of developing more complex drugs and biologics and complying with more onerous government regulations.
+Added: In such an event, our revenues may be reduced through increased downward pricing pressure, reduction in the scope of projects, delays or cancellations of ongoing projects, or our customers
+Added: shifting away from using third parties for their modeling and simulation work.
+Added: See “—Risks Related to our Business—Adverse global economic conditions could have a negative effect on our business, results of operations and financial condition and liquidity.” Our customers’ expenses and obligations could continue to increase as a result of the higher costs of developing more complex drugs and biologics and complying with more onerous government regulations.
Furthermore, our customers may finance their R&D spending from both private and public sources, including the capital markets.
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Government and university-based funding of scientific research can vary for a number of reasons, including general economic conditions, political priorities, changes in the number of students and other demographic changes.
−Removed: Our customers’ revenue and/or profitability could decline as a result of efforts by government and third-party payors to reduce the cost of healthcare.
+Added: Our customers’ revenue and/or profitability have declined and could continue to decline as a result of efforts by government and third-party payors to reduce the cost of healthcare and limit government spending.
Governments worldwide have increased efforts to expand healthcare coverage while at the same time curtailing and better controlling the increasing costs of healthcare.
If cost-containment efforts or other measures substantially change existing insurance models and limit our customers’ profitability, our customers may decrease R&D spending, which could decrease the demand for our services and materially adversely affect our growth prospects.
−Removed: Likewise, drug price controls are a topic subject to governmental intervention and regulation, and may vary by region, market and administration, and when applied could lead to reduced R&D spending by pharmaceutical companies, with one assumption being that they may have less financial incentive to develop new drugs, particularly for niche or complex therapeutic areas.
−Removed: For example, in the United States, specific drug price control provisions, allowing for negotiation of certain categories of drug prices through government executive agencies, were included in the Inflation Reduction Act of 2022, and the extent of their application may have an economic impact on the incentive structure related to drug development R&D spending by our customers.
+Added: Likewise, drug price controls are a topic subject to governmental intervention and regulation, and may vary by region, market and administration, and when applied have led to and could continue to lead to reduced R&D spending by pharmaceutical companies, with one assumption being that they may have less financial incentive to develop new drugs, particularly for niche or complex therapeutic areas.
+Added: For example, in the United States, specific drug price control provisions, allowing for negotiation of certain categories of drug prices through government executive agencies, were included in the Inflation Reduction Act of 2022, and the extent of their application has had and may continue to have an economic impact on the incentive structure related to drug development R&D spending by our customers.
+Added: Similarly, the imposition of most-favored-nation drug pricing in the U.S., reductions in Medicare and Medicaid spending, and the introduction of Medicaid work requirements under the One Big Beautiful Bill Act (“OBBBA”) have also had and may continue to have an economic impact on the incentive structure related to drug development R&D spending by our customers.
In addition, industry trends, economic factors, regulatory developments, patent protection and political and other events and circumstances that decrease our customers’ R&D spending also affect us.
+Added: Governments and third-party payors continue to pursue initiatives intended to reduce prescription drug costs, including through reimbursement changes, price negotiation or reference pricing concepts, and other executive or legislative actions.
+Added: These initiatives may reduce expected returns on pharmaceutical innovation, shift customer portfolio priorities, or otherwise reduce customer research and development budgets, which could reduce demand for our products and services or change the timing of customer spending.
+Added: In the United States, recent executive actions and related government initiatives concerning prescription drug pricing, together with existing statutes and implementing guidance, may create additional uncertainty in pricing frameworks.
+Added: For example, government-led initiatives to expand direct-to-consumer discount mechanisms and other pricing programs could alter market dynamics and may indirectly affect customer research and development investment levels and priorities.
Drug development cycles and investment in trials may also be impacted by a shift in government priorities, increased regulatory enforcement, more rigorous standards applied to public funding or reductions in philanthropic allocations or budgets.
In such events, delays in the biopharmaceutical development cycle, particularly related to clinical trials being paused or canceled, could also impact the demand or timing for our products and services.
+Added: Outside the United States, regulatory reforms may change the cost, timing, and operational requirements for clinical trials and related development activity.
+Added: For example, reforms to the UK clinical trials regulatory regime scheduled to take effect in 2026 may change approval processes, documentation requirements, and oversight practices, which could impact customer development timelines and the timing of demand for our products and services.
Furthermore, our financial success depends upon the creditworthiness and ultimate collection of amounts due from our customers.
−Removed: If we are not able to collect amounts due from our customers in a timely fashion due to funding or liquidity challenges or for any other reason, we may be required to write-off significant accounts
−Removed: receivable and recognize bad debt expenses, which could materially and adversely affect our operating results.
+Added: If we are not able to collect amounts due from our customers in a timely fashion due to funding or liquidity challenges or for any other reason, we may be required to write-off significant accounts receivable and recognize bad debt expenses, which could materially and adversely affect our operating results.
All of these events could have a material adverse effect on our business, financial condition and results of operations.
+Added: Operational disruptions, funding constraints and policy changes at the FDA and other government agencies could adversely affect regulatory activity and our business
+Added: Disruptions at the FDA and other U.S.
+Added: government agencies, whether arising from funding constraints, personnel losses, regulatory reform initiatives, government shutdowns, or public health emergencies, could adversely affect our business.
+Added: The FDA and comparable regulatory authorities in foreign jurisdictions play a central role in the drug development and approval process, including by providing guidance, conducting inspections, and reviewing regulatory submissions.
+Added: To the extent these activities are delayed, curtailed, or become less predictable, our ability to support customers’ development programs and regulatory submissions, the timing of customer progress, and demand for our products and services could be negatively impacted.
+Added: Recent leadership transitions, reorganizations, and workforce reductions at the FDA illustrate the nature of these risks.
+Added: Pursuant to Executive Order 14210, “Implementing the President’s ‘Department of Government Efficiency’ Workforce Optimization Initiative,” the Secretary of the Department of Health and Human Services (“HHS”) announced on March 27, 2025 a department‑wide reorganization and reduction in force of approximately 20,000 employees, including a planned reduction of approximately 3,500 full‑time positions at the FDA.
+Added: Shortly thereafter, thousands of FDA employees were terminated on April 1, 2025, and on July 14, 2025, following litigation reaching the U.S.
+Added: Supreme Court, the administration began implementing these layoffs across HHS, including at the FDA.
+Added: The workforce reductions and policy changes have also reportedly led to voluntary staff attrition.
+Added: These workforce disruptions could lead to delays or reduced availability of regulatory guidance, inspections, and review activities.
+Added: In addition, actions by the U.S.
+Added: government have disrupted, and may continue to disrupt, the operations of agencies such as the National Institutes of Health, National Science Foundation, Centers for Disease Control and Prevention, and FDA, which traditionally support basic research, research and development, and clinical testing.
+Added: Such actions have included, among other things, suspending, terminating or withholding funding under existing contracts and grants;
+Added: declining to continue multi‑year research projects;
+Added: canceling or delaying solicitations and award processes;
+Added: reducing staff responsible for managing research funding programs;
+Added: limiting agency resources that facilitate research activity;
+Added: delaying authorization of certain international transactions;
+Added: and initiating enforcement actions that may disrupt major research universities and other institutions that are significant contributors to life sciences research.
+Added: These developments could directly or indirectly delay, disrupt, or increase the cost of drug development and commercialization activities and reduce demand for our products and services.
+Added: Government funding for regulatory agencies and capital‑markets regulators, including the FDA, is also subject to the political process and may be interrupted by government shutdowns.
+Added: In recent years, shutdowns have resulted in furloughs of critical personnel and suspension of certain agency activities.
+Added: Any prolonged shutdown
+Added: could impair the FDA’s ability to review and process regulatory submissions and could also affect our ability to access the public markets and obtain capital on acceptable terms.
+Added: Finally, disruptions at the FDA and other regulatory authorities may arise from public health emergencies or other unforeseen events.
+Added: In such an event, FDA review timelines could be extended, and regulatory authorities outside the United States may adopt comparable restrictions or experience similar delays.
+Added: If any of the foregoing developments delay or limit the FDA’s ability to provide guidance, conduct inspections, or complete review activities that affect our customers or our business, or otherwise disrupt the research and regulatory ecosystem on which we rely, our business, results of operations, and financial condition could be materially adversely affected.
Consolidation within the biopharmaceutical industry may reduce the pool of potential customers for our products and services or reduce the number of licenses for our software products.
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Personnel redundancies and layoffs by merged companies to achieve deal synergies would result in a commensurate reduction in total users of our software, reducing the license fees we charge based on the number of users.
−Removed: Evolving corporate governance and public disclosure regulations and expectations, including with respect to sustainability matters, could expose us to risks.
−Removed: In recent years, there has been heightened interest from regulators, customers, investors, employees and other stakeholders on sustainability matters and related disclosures.
−Removed: Such attention to sustainability matters, including expanding mandatory and voluntary reporting, diligence, and disclosure on topics such as climate, human capital, labor and risk oversight, could expand the nature, scope, and complexity of matters that we are required to control, assess and report on.
−Removed: At the same time, regulators and other stakeholders have increasingly expressed or pursued opposing views, legislation and investment expectations with respect to sustainability initiatives.
−Removed: Conflicting regulations and a lack of harmonization of ESG legal and regulatory environments across the jurisdictions in which we operate may create enhanced compliance risks and costs.
−Removed: If our sustainability practices do not meet evolving stakeholders’ expectations and standards, or if we are unable to satisfy all stakeholders, our reputation, ability to attract or retain employees, financial condition, results of operations and cash flows could be negatively impacted.
−Removed: New and emerging costly and resource-consuming regulatory initiatives related to climate and sustainability matters could adversely affect our business, including, for example, the EU Corporate Sustainability Reporting Directive (“CSRD”) and climate disclosure laws adopted in California.
−Removed: These and other legal and regulatory requirements continue to evolve in scope and complexity, making compliance more difficult and uncertain.
−Removed: These changing rules, regulations and stakeholder expectations have resulted in, and are likely to continue to result in, increased general and administrative expenses and increased management time and attention spent complying with or meeting such regulations and expectations.
−Removed: We also expect to incur additional costs as we seek to engage in due diligence, verification and reporting in connection with our sustainability initiatives.
−Removed: In particular, based on certain revenue, presence thresholds, and other measures, we may become subject to the EU CSRD and the California climate disclosure laws.
−Removed: The EU’s CSRD will require expansive disclosures on climate change and other sustainability topics such as biodiversity, workforce, supply chain, and business ethics by in-scope EU entities and certain non-EU entities with significant cross-border business in EU markets.
−Removed: California’s Climate Corporate Data Accountability Act will require annual disclosure of covered companies’ Scope 1, 2 and 3 greenhouse gas (“GHG”) emissions.
−Removed: California’s Climate-related Financial Risk Act will require biannual disclosure of climate-related financial risk reports by covered companies.
−Removed: California’s Voluntary Carbon Market Disclosures Act will require disclosure from entities that participate in the voluntary carbon offset market, or that make certain claims about their CO2 or GHG emissions, updated at least annually.
−Removed: Further, we may from time to time announce, certain initiatives, including goals, targets and objectives, related to GHG emissions targets and other sustainability matters, in our SEC filings or in other public disclosures or reports.
−Removed: These initiatives and goals could be difficult and expensive to implement, and we could be criticized for the scope or nature of such initiatives, or for any revisions thereto, or the accuracy, adequacy or completeness of related disclosures.
−Removed: Statements about our sustainability initiatives and goals, and progress against those goals, reflect our current plans, which are based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future.
−Removed: There is no guarantee that we will be able to successfully achieve our initiatives or commitments related to sustainability matters, on the desired timeframes or at all.
−Removed: Nevertheless, if we fail or are perceived to fail to achieve progress with respect to our sustainability-related goals on a timely basis, or at all, or if we fail or are perceived to fail to comply with all laws, regulations, policies and related interpretations, this could negatively impact our reputation and our business results, as well as expose us to government enforcement actions, fines and private litigation.
−Removed: Achievement of our sustainability goals may also require us to incur additional costs or to make changes to our operations which could adversely affect our business and results of operations.
Risks Related to Our Business
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And although these small biotechnology companies tend to use third parties such as us for many of their development activities, these smaller companies also tend to be less financially secure.
−Removed: If their products are not successful or they have difficulty raising sufficient investment capital, they may not be able to timely or fully pay for our services, or they may terminate or decrease the scope of projects for which they use our products and services, which could adversely impact our revenues.
+Added: If their products are not successful or they have difficulty raising sufficient investment capital, they may not be able to timely or
+Added: fully pay for our services, or they may terminate or decrease the scope of projects for which they use our products and services, which could adversely impact our revenues.
Our strategy also includes expanding into new markets, new geographies, and new areas within our existing markets, either organically or by acquiring other companies in these markets.
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Even if we are able to identify and develop new technologies and biosimulation tools of interest, we may not be able to negotiate license agreements on acceptable terms, or at all.
−Removed: Some of our products, such as our QSP models, require significant time and investment to develop to a point where they can achieve market
−Removed: acceptance, and we may not be able to develop them at a rate that matches market demand.
+Added: Some of our products, such as our QSP models, require significant time and investment to develop to a point where they can achieve market acceptance, and we may not be able to develop them at a rate that matches market demand.
We may also face more significant pricing pressure as we expand geographically and our customer profile evolves.
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As of December 31, 2025, 414 of our employees held PhDs or doctor of medicine degrees.
−Removed: In order to attract and retain personnel in a competitive marketplace, we believe that we must provide a competitive compensation package, and compensation for our employees, which makes up our most significant fixed cost.
+Added: In order to attract and retain personnel in a competitive marketplace, we believe that we must provide a competitive compensation package for our employees, which makes up our most significant fixed cost.
Nonetheless, we may be unable to hire, train, retain, or motivate highly qualified personnel on acceptable terms or at all given the competition among numerous biopharmaceutical and technology companies for similar personnel.
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We would also be liable for unpaid past taxes, subject to penalties and increased operating costs moving forward.
−Removed: We may also have difficulty staffing
−Removed: certain projects if we were not able to convert independent contractors to full or part-time employees.
+Added: We may also have difficulty staffing certain projects if we were not able to convert independent contractors to full or part-time employees.
As a result, any determination that our independent contractors are our employees could have a material adverse effect on our business, financial condition and results of operations.
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The emergence of AI and relevance to our sector may result in more competition over time, which could adversely affect the performance of our business.
−Removed: The development, deployment and use of AI, particularly generative AI, however, is still in its early stages and presents risks that could negatively impact our business.
+Added: The development, deployment and use of AI, particularly generative AI and agentic AI systems that can take action autonomously, however, is still in its early stages and presents risks that could negatively impact our business.
While we aim to develop and use AI responsibly and attempt to identify and mitigate ethical and legal issues presented by its use, we may be unsuccessful in identifying and resolving issues before they arise, and the usage of such technologies may not enhance our products or services, keep pace with our competitors or be beneficial to our business, including our efficiency and profitability.
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The input of confidential information or trade secrets into AI systems may result in the loss of intellectual property, proprietary rights, or attorney-client privilege in such information or trade secrets.
+Added: Despite training and risk management efforts, there is a possibility that employees might misuse AI, either intentionally or unintentionally, including by using authorized AI tools, applications or services, exposing us to risks including confidential data leakage and security vulnerabilities.
The use of AI technologies for developing products or services may adversely affect or preclude our intellectual property rights in such products or services or may expose us to liability related to the infringement, misappropriation or other violation of third-party intellectual property.
−Removed: The use of AI technologies with personally identifiable information or protected health information may also result in legal liability.
+Added: The use of AI technologies with personally identifiable information or protected health information
+Added: may also result in legal liability.
If we do not have sufficient rights to use the data or other material or content on which the AI tools we use rely, we also may incur liability through the violation of applicable laws and regulations, third-party intellectual property, data privacy, or other rights, or contracts to which we are a party.
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states and other foreign jurisdictions are applying, or are considering applying, their platform moderation, data privacy, and security laws and regulations to AI or are considering general legal frameworks for AI.
−Removed: We may not be able to anticipate how to respond to these rapidly evolving frameworks, and we may need to expend resources to adjust our operations or offerings in certain jurisdictions if the legal frameworks are inconsistent across jurisdictions.
−Removed: Furthermore, because AI technology itself is highly
−Removed: complex and rapidly developing, it is not possible to predict all of the legal, operational, or technological risks that may arise relating to the use of AI.
+Added: In Europe, the EU’s Artificial Intelligence Act, which entered into force on August 1, 2024 and, with some exceptions, will begin to apply as of August 2, 2026, imposes significant obligations on providers and deployers of high-risk artificial intelligence systems, and encourages providers and deployers of artificial intelligence systems to account for EU ethical principles in their development and use of these systems.
+Added: We may not be able to anticipate how to respond to these rapidly evolving frameworks, and the uncertainty surrounding evolving regulations may complicate new product development.
+Added: We may need to expend resources to adjust our operations or offerings in certain jurisdictions if the legal frameworks are inconsistent across jurisdictions.
+Added: Furthermore, because AI technology itself is highly complex and rapidly developing, it is not possible to predict all of the legal, operational, or technological risks that may arise relating to the use of AI.
Our failure to adequately address legal risks relating to AI in our business could result in litigation regarding, among other things, intellectual property, privacy, employment, civil rights and other claims that could result in liability for our company, damage our reputation or otherwise materially harm our business.
+Added: Public and regulatory scrutiny of AI-related claims has increased, and companies have faced enforcement actions and litigation based on allegations that their AI capabilities or use of AI were overstated, misleading, or not adequately substantiated.
+Added: If our statements, whether in SEC filings, earnings materials, marketing, or customer communications, are alleged to mischaracterize the nature, scope, or performance of our AI-enabled capabilities or our internal use of AI, we could face reputational harm, customer disputes, regulatory inquiries, enforcement actions, or litigation.
If our existing customers do not renew their software licenses, do not buy additional solutions from us or renew at lower prices, our business and operating results will suffer.
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If our customers fail to renew their agreements, renew their agreements upon less favorable terms or at lower fee levels or fail to purchase new software solutions and licenses from us, our revenues may decline and our future revenues may be constrained.
−Removed: Furthermore, our sales process is dependent on the reputation of our solutions and business and on positive recommendations from our
−Removed: existing customers.
+Added: Furthermore, our sales process is dependent on the reputation of our solutions and business and on positive recommendations from our existing customers.
Any dissatisfaction from existing customers may adversely impact our ability to sell our solutions to new customers.
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government entities, including the FDA and the Center for Disease Control and Prevention within the Department of Health and Human Services, as well as foreign governments.
−Removed: For example, our software products are licensed by 23 global drug regulatory agencies, including the FDA, Health Canada, Japan’s PMDA, China’s NMPA and the UK’s MHRA.
+Added: For example, our software products are licensed by 20 global drug regulatory agencies, including the FDA, Japan’s PMDA, China’s NMPA and the UK’s MHRA.
We have also accepted limited grant funds from governmental entities, whereby we are reimbursed for certain expenses incurred, subject to our compliance with the specific requirements of the applicable grant, including rigorous documentation requirements.
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Increasingly, government support and funding may change with new administrations, personnel or polices in effect from time to time, in the United States and globally.
−Removed: Under these more prevalent circumstances, with respect to these contract and
−Removed: revenue sources, we may operate with less certainty and shorter known time horizons on public sector commitments and contracts.
+Added: Under these more prevalent circumstances, with respect to these contract and revenue sources, we may operate with less certainty and shorter known time horizons on public sector commitments and contracts.
These arrangements subject us to statutes and regulations applicable to companies doing business with the government and customarily contain provisions that give the government substantial rights and remedies, many of which are not typically found in commercial contracts and which are unfavorable to contractors, including provisions that allow the government to unilaterally terminate or modify our federal government contracts, in whole or in part, at the government’s convenience or in the government’s best interest, including if funds become unavailable to the applicable government agency.
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These requirements include, for example:
−Removed: • compliance with complex regulations for procurement, formation, administration, and performance of government contracts under the Federal Acquisition Regulations, agency-specific regulations supplemental to the Federal Acquisition Regulations, and regulations specific to the administration of grants by the U.S.
+Added: • compliance with complex regulations for procurement, formation, administration, and performance of government contracts under the Federal Acquisition Regulations, agency-specific regulations
+Added: supplemental to the Federal Acquisition Regulations, and regulations specific to the administration of grants by the U.S.
• specialized disclosure and accounting requirements unique to government contracts and grants;
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Any penalties, damages, fines, suspension, or damages could have a material adverse impact on our business, financial condition and results of operations.
−Removed: Our historic growth rates may not be sustainable or indicative of future growth.
−Removed: While our growth has moderated in recent years, we have historically experienced periods of significant growth, including within the last five years.
−Removed: Our growth over these periods is attributable to both organic revenue growth and revenue from acquisitions over these periods.
−Removed: Revenue increased from $208.5 million for 2019 to $385.1 million for 2024.
−Removed: Our historical rate of growth may not be sustainable or indicative of our future rate of growth.
−Removed: We believe that our continued growth in revenue, as well as our ability to improve or maintain margins and profitability, will depend upon, among other factors, our ability to address the challenges, risks and difficulties described elsewhere in this “Risk Factors” section and the extent to which our various product offerings grow (either through internal development or external acquisition) and contribute to our results of operations.
−Removed: In addition, our customer base may not continue to grow or may decline due to a variety of possible risks, including increased competition, changes in the regulatory landscape and the maturation of our business.
−Removed: Any of these factors could cause our revenue growth to decline and may adversely affect our margins and profitability.
−Removed: Failure to continue our revenue growth or improve margins would have a material adverse effect on our business, financial condition and results of operations.
−Removed: You should not rely on our historical rate of revenue growth as an indication of our future performance.
We regularly evaluate potential acquisitions and other strategic transactions that we deem beneficial and strategic to our long-term growth and profitability, which could divert our management’s attention, result in additional dilution to our stockholders, and otherwise disrupt our operations and adversely affect our operating results.
−Removed: We have acquired multiple businesses and technologies in the past, and we regularly evaluate opportunities to acquire or invest in businesses, solutions or technologies that we believe could complement or expand our solutions, enhance our technical capabilities or otherwise offer growth opportunities as well as opportunities to streamline our existing business.
−Removed: For example, in November 2024, we announced that we have begun a review process to consider the long-term strategic options for our regulatory services business.
−Removed: The pursuit of potential acquisitions or other strategic transactions may divert the attention of management and cause us to incur various expenses in identifying, investigating and pursuing suitable opportunities, whether or not they are consummated.
+Added: We have acquired multiple businesses and technologies in the past, and we regularly evaluate opportunities to acquire or invest in businesses, solutions or technologies that we believe could complement or expand our solutions, enhance our technical capabilities or otherwise offer growth opportunities as well as opportunities to streamline our existing business, including through potential divestitures.
+Added: The pursuit of potential acquisitions, divestitures or other strategic transactions may divert the attention of management and cause us to incur various expenses in identifying, investigating and pursuing suitable opportunities, whether or not they are consummated.
We may not be able to successfully integrate the personnel, operations and technologies of the businesses we acquire, effectively manage the combined business following an acquisition or preserve the operational synergies between our business units that we underwrite at the time of such acquisition.
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• use of substantial portions of our available cash to consummate the acquisition.
−Removed: For example, in 2023, we acquired Formedix Limited, which added a metadata repository and clinical data flow automation to our data platform, as well as Applied Biomath, a company focused on quantitative systems pharmacology (QSP) to expand and complement our existing QSP capabilities.
−Removed: Additionally, in 2024, we acquired Chemaxon, a leading provider of cheminformatics software to expand and complement our existing prediction and analytical capabilities in drug discovery.
−Removed: The planned integrations of these businesses into our existing product offerings may be delayed or may not achieve the expected results.
+Added: For example, in 2024, we acquired Chemaxon, a leading provider of cheminformatics software to expand and complement our existing prediction and analytical capabilities in drug discovery.
+Added: The planned integrations of our newly acquired businesses into our existing product offerings may be delayed or may not achieve the expected results.
Some acquisitions are structured in such a way that a portion of the purchase price may be based on achieving certain post-closing conditions (i.e., “earn-outs”), such as the Company recognizing certain levels of revenue generated by the acquired business.
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Our Total Available Market (“TAM”) is based on publicly available third-party market research and internal estimates regarding the size of our markets, is subject to significant uncertainty and change, and is based on assumptions that may not prove to be accurate or continuing.
−Removed: We have based the TAM for our business on our current core markets, biosimulation, regulatory science, and market access, which may change from time to
−Removed: time as our strategy evolves.
+Added: We have based the TAM for our business on our current core markets, biosimulation, regulatory science, and market access, which may change from time to time as our strategy evolves.
While we believe the information on which we base our TAM is generally informative, such expectations, assumptions and estimates are inherently imprecise.
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Adverse global economic conditions could have a negative effect on our business, results of operations and financial condition and liquidity.
−Removed: A general slowdown in the global economy or in a particular region or industry, other unfavorable changes in economic conditions, such as inflation, higher interest rates, tightening of the credit markets, recession or slowing growth, or an increase in trade tensions with U.S.
+Added: A general slowdown in the global economy or in a particular region or industry, other unfavorable changes in economic conditions, such as inflation, higher interest rates, tightening of the credit markets, recession or slowing growth, uncertainty regarding tariffs, actual or potential changes in the research funding environment or an increase in trade tensions with U.S.
trading partners could negatively impact our business, financial condition and liquidity.
−Removed: Macroeconomic weakness and uncertainty also make it more difficult for us to accurately forecast operating results and may make it more difficult to raise or refinance debt.
Sustained uncertainty about, or worsening of, current global economic conditions and further escalation of trade tensions between the U.S.
and its trading partners, especially China, could result in a global economic slowdown and long-term changes to global trade.
−Removed: Such events may also (i) cause our customers to reduce, delay or forgo R&D spending, (ii) result in customers sourcing products or services in-house or from other suppliers not subject to such restrictions or tariffs, (iii) lead to the insolvency or consolidation of key customers and/or (iv) intensify pricing pressures.
−Removed: Any or all of these factors could negatively affect demand for our products and our business, financial condition and results of operations.
+Added: Such events may also (i) cause our customers to reduce, delay or forgo R&D spending, (ii) result in customers sourcing products or services in-house or from other suppliers not subject to such restrictions or tariffs, (iii) lead to the insolvency or consolidation of key customers, particularly smaller biotech companies, (iv) result in customers preferring software to services, and/or (v) intensify pricing pressures.
+Added: Any or all of these factors, particularly when combined with financial pressures on and uncertainty in the biopharmaceutical industry, could negatively affect demand for our products and our business, financial condition and results of operations.
+Added: See “—Risks Related to our Industry—Reduction in R&D spending by our customers for a variety of reasons, including due to lack of funding, as well as delays in the drug discovery and development process, may reduce demand for our products and services and negatively impact our results of operations and financial condition.” Additionally, we are continuing to monitor the implications of any policy developments around potential research funding reductions.
+Added: Macroeconomic weakness and uncertainty also make it more difficult for us to accurately forecast operating results and may make it more difficult to raise or refinance debt.
We are subject to economic, political and other risks associated with the operation of a global business that could negatively affect our business, results of operations and financial condition.
−Removed: We operate on a global basis with offices or activities in the United States, Canada, France, Germany, the Netherlands, Poland, Switzerland, the United Kingdom, Australia, India, the Philippines, Japan, China, Hungary, and South Korea.
+Added: We operate on a global basis with offices or activities in the United States, Canada, France, Germany, the Netherlands, Poland, Switzerland, the United Kingdom, India, the Philippines, Japan, China, Hungary, and South Korea.
In addition, we derive a significant portion of our total revenue from our operations in international markets.
−Removed: During the years ended December 31, 2024 and 2023, 28% and 27%, respectively, of our revenues were transacted in foreign currencies, the majority of which included the British Pound Sterling, the Euro and Japanese Yen.
+Added: During the years ended December 31, 2025 and 2024, 31% and 28%, respectively, of our revenues were transacted in foreign currencies, the majority of which included the British Pound Sterling, the
+Added: Euro and Japanese Yen.
Our international operations and sales subject us to a number of increased risks, including, among others:
7 unchanged sentences
• being subject to complex and restrictive immigration, employment and labor laws and regulations, as well as union and works council restrictions ;
−Removed: • changes in tax laws or rulings in the United States or other foreign jurisdictions that may have an adverse impact on our effective tax rate;
+Added: • changes in tax laws or rulings in the United States or other foreign jurisdictions that may have an adverse impact on our effective tax rate, such as the OBBA;
• being subject to burdensome foreign laws and regulations, including regulations that may place an increased tax burden on our operations;
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Furthermore, political, diplomatic or military events could result in trade disruptions, including tariffs, trade embargoes, export restrictions and other trade barriers.
−Removed: A significant trade disruption, export restriction, or the establishment or increase of any trade barrier in any area where we do business could reduce customer demand and cause customers to search for substitute products and services, make our products and services more expensive or unavailable for customers, increase the cost of our products and services, have a negative impact on customer confidence and spending, make our products or services less competitive, or otherwise have an adverse impact on our business, operating results and financial condition.
+Added: A significant trade disruption, export restriction, or the establishment or increase of any trade barrier in any area where we do business could reduce customer demand and cause customers to search for substitute products and services, make our products and services more expensive or unavailable for customers, increase the cost of our products and services, have a negative impact
+Added: on customer confidence and spending, make our products or services less competitive, or otherwise have an adverse impact on our business, operating results and financial condition.
Moreover, in response to the U.S.
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These laws and regulations are complex and may have differing or conflicting legal standards, making compliance difficult and costly.
−Removed: In addition, there is uncertainty regarding how proposed, contemplated or future changes to these complex laws and regulations
−Removed: could affect our business.
+Added: In addition, there is uncertainty regarding how proposed, contemplated or future changes to these complex laws and regulations could affect our business.
We may incur substantial expense in complying with the new obligations to be imposed by these laws and regulations, and we may be required to make significant changes in our business operations, all of which may adversely affect our revenues and our business overall.
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We may be unable to hedge all of our foreign currency risk, which could have a material adverse effect on our business, financial condition and results of operations.
−Removed: We are subject to the FCPA and the U.K.
−Removed: Bribery Act and similar anti-corruption laws and regulations in other countries and jurisdictions.
−Removed: Violations of these laws and regulations could harm our reputation and business, or materially adversely affect our business, results of operations, financial condition and/or cash flows.
−Removed: We operate in numerous countries around the world and are subject to the FCPA, the U.K.
−Removed: Bribery Act and similar anti-bribery laws in the countries and jurisdictions in which we operate.
−Removed: Our business involves sales to government and state-owned agencies and brings us and others acting on our behalf, into contact with government officials around the world.
−Removed: The FCPA and the U.K.
−Removed: Bribery Act prohibit us and our officers, directors, employees and third parties acting on our behalf, including distributors and agents, from corruptly offering, promising, authorizing or providing anything of value to a “foreign official” for the purposes of influencing official decisions or obtaining or retaining business or otherwise obtaining favorable treatment.
−Removed: The FCPA further requires us to make and keep books, records and accounts that accurately reflect transactions and dispositions of assets and to maintain a system of adequate internal accounting controls.
−Removed: Bribery Act also prohibits “commercial” bribery and accepting bribes.
−Removed: Although our officers, directors, employees, distributors, and agents are required to comply with these laws and are subject to our internal policies and procedures, we cannot be sure that our internal policies and procedures will always protect us from liability for violations of these laws committed by persons associated with us, including our employees or third parties acting on our behalf.
−Removed: Violations of anti-corruption laws, or even allegations of such violations, could disrupt our business and result in a material adverse effect on our business, financial condition and results of operations.
−Removed: For example, violations may result in criminal or civil penalties, disgorgement of profits, related stockholder lawsuits, debarment from government contracting and other remedial measures.
Our failure to comply with trade compliance and economic sanctions laws and regulations of the United States and other applicable international jurisdictions could materially adversely affect our reputation and results of operations.
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expose us to the risk of violating, or being accused of violating, either directly or indirectly through our distributors, economic and trade sanctions laws and regulations.
−Removed: Our failure to comply with these laws and regulations may expose us to reputational harm as well as significant penalties, including criminal
−Removed: fines, imprisonment, civil fines, disgorgement of profits, injunctions and debarment from government contracts, as well as other remedial measures.
+Added: Our failure to comply with these laws and regulations may expose us to reputational harm as well as significant penalties, including criminal fines, imprisonment, civil fines, disgorgement of profits, injunctions and debarment from government contracts, as well as other remedial measures.
Investigations of alleged violations can be expensive and disruptive.
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The FDA may also issue or finalize guidance documents that may have implications for our customers and our products, platforms, and services.
+Added: For example, in September 2025, the FDA finalized its guidance on “E6(R3) Good Clinical Practice”, which seeks to provide a unified standard to facilitate the mutual acceptance of clinical trial data for International Council for Harmonisation member countries and regions by applicable regulatory authorities.
We may be subject to inspection by regulatory authorities in connection with our customers’ marketing applications and other regulatory submissions.
If we fail to perform our services in accordance with regulatory requirements, regulatory authorities may take action against us or our customers for failure to comply with applicable regulations governing the development and testing of therapeutic products.
−Removed: Regulatory authorities may also disqualify certain data or analyses from consideration in connection with applications for regulatory approvals, which would result in our customers not being able to rely on our services in connection with their regulatory
−Removed: submissions and may subject our customers to additional or repeat clinical trials and delays in the development and regulatory approval process.
−Removed: Mistakes in providing services to our customers, such as dosing models, could affect medical decisions for patients in clinical trials and create liability for personal injury.
+Added: Regulatory authorities may also disqualify certain data or analyses from consideration in connection with applications for regulatory approvals, which would result in our customers not being able to rely on our services in connection with their regulatory submissions and may subject our customers to additional or repeat clinical trials and delays in the development and regulatory approval process.
+Added: Mistakes in providing services to our customers, such as dosing models, could
+Added: affect medical decisions for patients in clinical trials and create liability for personal injury.
Such actions may include sanctions, such as warning or untitled letters, injunctions, or failure of such regulatory authorities to grant marketing approval of products, delay, suspension, or withdrawal of approvals, license revocation, loss of accreditation;
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As a result of these factors, our bookings are not necessarily a reliable indicator of future direct revenue, and we might not realize all or any part of the revenue from the authorizations in bookings at any given point in time.
+Added: We are subject to the FCPA and the U.K.
+Added: Bribery Act and similar anti-corruption laws and regulations in other countries and jurisdictions.
+Added: Violations of these laws and regulations could harm our reputation and business, or materially adversely affect our business, results of operations, financial condition and/or cash flows.
+Added: We operate in numerous countries around the world and are subject to the FCPA, the U.K.
+Added: Bribery Act and similar anti-bribery laws in the countries and jurisdictions in which we operate.
+Added: Our business involves sales to government and state-owned agencies and brings us and others acting on our behalf, into contact with government officials around the world.
+Added: The FCPA and the U.K.
+Added: Bribery Act prohibit us and our officers, directors, employees and third parties acting on our behalf, including distributors and agents, from corruptly offering, promising, authorizing or providing anything of value to a “foreign official” for the purposes of influencing official decisions or obtaining or retaining business or otherwise obtaining favorable treatment.
+Added: The FCPA further requires us to make and keep books, records and accounts that accurately reflect transactions and dispositions of assets and to maintain a system of adequate internal accounting controls.
+Added: Bribery Act also prohibits “commercial” bribery and accepting bribes.
+Added: Although our officers, directors, employees, distributors, and agents are required to comply with these laws and are subject to our internal policies and procedures, we cannot be sure that our internal policies and procedures will always protect us from liability for violations of these laws committed by persons associated with us, including our employees or third parties acting on our behalf.
+Added: Violations of anti-corruption laws, or even allegations of such violations, could result in a material adverse effect on our business, financial condition and results of operations.
+Added: For example, violations may result in criminal or civil penalties, disgorgement of profits, related stockholder lawsuits, debarment from government contracting and other remedial measures, as well as reputational harm.
Our business may be subject to risks arising from catastrophic events, including natural disasters, significant or extreme weather events, outbreaks of war or terrorism, epidemic diseases, pandemics, and public health crises.
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See “Risks Related to Intellectual Property, Information Technology and Data Privacy.”
−Removed: Although we have disaster recovery and business continuity plans, carry business interruption insurance policies and typically have provisions in our contracts that protect us in certain force majeure type events, we cannot be
−Removed: certain that our plans will be successful in the event of a disaster, that our insurance coverage will be adequate to compensate us for all losses that may occur or that provisions in our contracts will afford us adequate protection.
+Added: Although we have disaster recovery and business continuity plans, carry business interruption insurance policies and typically have provisions in our contracts that protect us in certain force majeure type events, we cannot be certain that our plans will be successful in the event of a disaster, that our insurance coverage will be adequate to compensate us for all losses that may occur or that provisions in our contracts will afford us adequate protection.
If our disaster recovery or business continuity plans are unsuccessful in a disaster recovery scenario, we could potentially experience material adverse impacts, including loss of data, disruption to our operations, legal or regulatory proceedings, reputational harm and loss of customers, any of which could have a material adverse effect on our business, financial condition and results of operations.
+Added: Evolving corporate governance and public disclosure regulations and expectations, including with respect to sustainability matters, could expose us to risks.
+Added: In recent years, there has been heightened interest from regulators, customers, investors, employees and other stakeholders on sustainability matters and related disclosures.
+Added: Such attention to sustainability matters, including expanding mandatory and voluntary reporting, diligence, and disclosure on topics such as climate, human capital, labor and risk oversight, could expand the nature, scope, and complexity of matters that we are required to control, assess and report on.
+Added: At the same time, regulators and other stakeholders have increasingly expressed or pursued opposing views, legislation and investment expectations with respect to sustainability initiatives.
+Added: Conflicting regulations and a lack of harmonization of ESG legal and regulatory environments across the jurisdictions in which we operate may create enhanced compliance risks and costs.
+Added: If our sustainability practices do not meet evolving stakeholders’ expectations and standards, or if we are unable to satisfy all stakeholders, our reputation, ability to attract or retain employees, financial condition, results of operations and cash flows could be negatively impacted.
+Added: New and emerging costly and resource-consuming regulatory initiatives related to climate and sustainability matters could adversely affect our business, including, for example, the EU Corporate Sustainability Reporting
+Added: Directive (“CSRD”) and climate disclosure laws adopted in California.
+Added: These and other legal and regulatory requirements continue to evolve in scope and complexity, making compliance more difficult and uncertain.
+Added: These changing rules, regulations and stakeholder expectations have resulted in, and are likely to continue to result in, increased general and administrative expenses and increased management time and attention spent complying with or meeting such regulations and expectations.
+Added: We also expect to incur additional costs as we seek to engage in due diligence, verification and reporting in connection with our sustainability initiatives.
+Added: In particular, based on certain revenue, presence thresholds, and other measures, we may become subject to the EU CSRD and the California climate disclosure laws.
+Added: The EU’s CSRD will require expansive disclosures on climate change and other sustainability topics such as biodiversity, workforce, supply chain, and business ethics by in-scope EU entities and certain non-EU entities with significant cross-border business in EU markets.
+Added: California’s Climate Corporate Data Accountability Act will require annual disclosure of covered companies’ Scope 1, 2 and 3 greenhouse gas (“GHG”) emissions.
+Added: California’s Climate-related Financial Risk Act will require biannual disclosure of climate-related financial risk reports by covered companies.
+Added: California’s Voluntary Carbon Market Disclosures Act will require disclosure from entities that participate in the voluntary carbon offset market, or that make certain claims about their CO2 or GHG emissions, updated at least annually.
+Added: Further, we may from time to time announce, certain initiatives, including goals, targets and objectives, related to GHG emissions targets and other sustainability matters, in our SEC filings or in other public disclosures or reports.
+Added: These initiatives and goals could be difficult and expensive to implement, and we could be criticized for the scope or nature of such initiatives, or for any revisions thereto, or the accuracy, adequacy or completeness of related disclosures.
+Added: Statements about our sustainability initiatives and goals, and progress against those goals, reflect our current plans, which are based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future.
+Added: There is no guarantee that we will be able to successfully achieve our initiatives or commitments related to sustainability matters, on the desired timeframes or at all.
+Added: Nevertheless, if we fail or are perceived to fail to achieve progress with respect to our sustainability-related goals on a timely basis, or at all, or if we fail or are perceived to fail to comply with all laws, regulations, policies and related interpretations, this could negatively impact our reputation and our business results, as well as expose us to government enforcement actions, fines and private litigation.
+Added: Achievement of our sustainability goals may also require us to incur additional costs or to make changes to our operations which could adversely affect our business and results of operations.
Risks Related to Intellectual Property, Information Technology and Data Privacy
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Work-from-home and other flexible work arrangements have impacted our third-party vendors by increasing operational challenges and risks, including vulnerabilities to cybersecurity and information technology infrastructure threats.
−Removed: A prolonged service disruption affecting our cloud-based solutions for any of the foregoing reasons would negatively impact our ability to serve our customers and could damage our reputation with current and potential customers, expose us to liability, cause us to lose customers or otherwise harm our business.
+Added: A prolonged service disruption affecting our
+Added: cloud-based solutions for any of the foregoing reasons would negatively impact our ability to serve our customers and could damage our reputation with current and potential customers, expose us to liability, cause us to lose customers or otherwise harm our business.
We may also incur significant costs for using alternative equipment or taking other actions in preparation for, or in reaction to, events that damage the third-party hosting services we use.
In the event that our service agreements with our third-party hosting services are terminated, or there is a lapse or interruption of services or features that we utilize, we could experience interruptions in access to our platform as well as significant delays and additional expense in arranging or creating new facilities and services and/or re-architecting our hosted software solutions for deployment on a different cloud infrastructure service provider, which could adversely affect our business, financial condition and results of operations.
−Removed: If we are not able to reliably meet our data storage and management or other information technology requirements, or if we experience any technology failures in the delivery of our services over the internet or in the administration of our business, customer satisfaction and our reputation could be harmed and customer contracts may be terminated.
−Removed: As part of our current business model, the portion of our software that is delivered over the internet as SaaS is increasing, and we store and manage significant data for our customers, resulting in substantial information technology infrastructure and ongoing technological challenges, which we expect to continue to increase over time.
−Removed: If we do not reliably meet these data storage and management requirements, or if we experience any failure or interruption in the delivery of our services over the internet, customer satisfaction and our reputation could be harmed, leading to reduced revenues and increased expenses.
−Removed: Our hosting services are subject to service-level agreements and, if we fail to meet guaranteed service or performance levels, we could be subject to customer credits or termination of these customer contracts.
−Removed: If the cost of meeting these data storage and
−Removed: management requirements increases, our business, financial condition and results of operations could be harmed.
−Removed: Furthermore, we utilize multiple complex integrated software and hardware operating systems, including enterprise resource planning systems, to support our business, and we have a continuous improvement strategy in place to keep our systems and overarching technology stable and in line with our business needs and growth.
−Removed: While we employ controlled change management methodologies to plan, test and execute all such system upgrades and improvements, transitioning critical business or accounting functions to upgraded or new processes and systems may require significant capital investments and personnel resources and coordination with third-party software and system providers.
−Removed: We cannot assure that our systems will meet our future business needs, that upgrades or new systems will operate as designed or that there will not be associated excessive costs or disruptions in portions of our business in the course of our maintenance, support, upgrade and/or transition of these systems.
−Removed: If our information technology systems, upgrades and associated change management are not adequate to support our business and our strategic initiatives, our business, financial condition and results of operations could be harmed.
−Removed: Some of our software solutions utilize third-party open source software, and any failure to comply with the terms of one or more of these open source licenses could adversely affect our business, subject us to litigation and create potential liability.
−Removed: Some of our software solutions utilize software covered by open source licenses, and we expect to continue to incorporate open source software in our solutions in the future.
−Removed: Open source software is often widely accessible, usable and modifiable and may be used by our development team in an effort to reduce development costs and speed up the development process.
−Removed: Use of open source software also in some respects entails greater risks than use of third party commercial software, as open source licensors generally do not provide warranties or other contractual protections regarding infringement claims or the quality of the code, including with respect to security vulnerabilities.
−Removed: Although we have processes intended to comply with the license requirements in our software, certain open source software licenses require, among other things, that a licensor that distributes the open source software as a component of the licensor’s proprietary software to provide or offer to provide to the customer-licensee part or all of the source code to the licensor’s proprietary software.
−Removed: While we have policies against using this type of open source code in our distributed software, if we were to utilize this type of open source code, and if the owner of the copyright of the relevant open source software were to allege that we had not complied with the conditions of one or more of these licenses, we could be required to incur significant legal expenses defending against such allegations and could be subject to significant damages, enjoined from the sale of our solutions that contain the open source software and required to comply with onerous conditions or restrictions on these solutions, which could disrupt the distribution and sale of these solutions.
−Removed: Litigation or other enforcement actions initiated by a copyright owner could have a negative effect on our business, financial condition and results of operations, or require us to devote additional R&D resources to change our solutions.
−Removed: Moreover, we could effectively be required to publicly release the affected portions of our source code, re-engineer all or a portion of our solutions or otherwise be limited in the licensing of our solutions, each of which could reduce or eliminate the value of our solutions.
−Removed: Disclosing our proprietary source code could allow our competitors to create similar products with lower development effort and time and ultimately could result in a loss of sales.
−Removed: Any of these events could create liability for us and damage our reputation, which could have a material adverse effect on our business, financial condition and results of operations.
+Added: In addition, certain jurisdictions have adopted or are adopting laws and regulations intended to facilitate customer portability and switching between cloud service providers and to impose interoperability obligations.
+Added: To the extent such requirements apply to our hosted solutions or to key vendors we rely upon, we may incur additional costs to support portability, interoperability, and contract compliance, and we may experience increased customer churn or pricing pressure if switching becomes easier.
If our cybersecurity measures are breached or unauthorized or unlawful access to customer or other proprietary data occurs, our solutions may be perceived as not being secure, customers may reduce the use of or stop using our solutions and/or we may incur significant liabilities.
−Removed: The evolution of technology systems introduces ever more complex risks of cybersecurity threats that are difficult to predict and defend against.
+Added: The evolution of technology systems, particularly the emergence of artificial technology and machine learning, introduces ever more complex risks of cybersecurity threats that are difficult to predict and defend against.
An increasing number of companies, including those with significant online operations, have recently disclosed breaches of their cybersecurity systems, some of which involved sophisticated tactics and techniques allegedly attributable to criminal enterprises or nation-state actors.
−Removed: Our efforts to improve our defenses may not always prove successful, and we may detect, or receive notices from customers and both public and private agencies that they have detected, actual or perceived vulnerabilities or fraudulent activity.
+Added: We have in the past experienced, and may in the future experience, threats and security incidents related to our data and systems.
+Added: Our efforts to defend against breaches or unauthorized access to customer or other proprietary data may not always prove successful, and we may detect, or receive notices from customers and both public and private agencies that they have detected, actual or perceived vulnerabilities or fraudulent activity.
In addition, cybersecurity threats are constantly evolving, are becoming more frequent and more sophisticated and are being made by groups of individuals with a wide range of expertise and motives, which increases the difficulty of detecting and successfully defending against them.
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Additionally, we rely on third parties and their cybersecurity procedures for the secure storage, processing, maintenance, and transmission of information that is critical to our operations and such third parties may also suffer cybersecurity incidents.
−Removed: Depending on their nature and scope, this could potentially result in the misappropriation, destruction, corruption or unavailability of critical data and confidential or proprietary information (our own or that of third parties, including information about our customers and employees) and the disruption of business operations.
+Added: Depending on the nature and scope, any such incident could potentially result in the misappropriation, destruction, corruption or
+Added: unavailability of critical data and confidential or proprietary information (our own or that of third parties, including information about our customers and employees) and the disruption of business operations.
If there is a cybersecurity incident and we know or reasonably suspect that certain personal information has been subject to unauthorized or unlawful access or use, we may need to inform the affected individuals and make certain public disclosures;
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In addition, if our technical and operational cybersecurity safeguards fail, our existing and prospective customers may lose confidence in our ability to maintain the confidentiality of their intellectual property and other proprietary and sensitive data, we may be subject to breach of contract claims by our customers.
−Removed: Our insurance may not be adequate to cover losses associated with
−Removed: such events, and in any case, such insurance may not cover all of the types of costs, expenses and losses we could incur to respond to and remediate a security breach.
+Added: Our insurance may not be adequate to cover losses associated with such events, and in any case, such insurance may not cover all of the types of costs, expenses and losses we could incur to respond to and remediate a security breach.
Defending against investigations, claims or litigation based on any security breach or incident, regardless of their merit, will be costly.
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Compliance with such laws and related contractual requirements may require changes to our information processing practices and may thereby increase compliance costs.
−Removed: Failure to comply with such laws and/or related contractual obligations could result in regulatory enforcement or claims against us for breach of contract or may lead third parties to terminate their contracts with us and/or choose not to work with us in the future.
+Added: Failure to comply with such laws and/or related contractual obligations could result in regulatory enforcement or claims against us for
+Added: breach of contract or may lead third parties to terminate their contracts with us and/or choose not to work with us in the future.
Should this occur, there could be a material adverse effect on our business, financial condition and results of operations.
4 unchanged sentences
If such information that we publish is considered untrue, we may be subject to government claims of unfair or deceptive trade practices, which could lead to significant liabilities and consequences.
−Removed: Furthermore, according to the FTC, violating consumers’ privacy rights or failing to take appropriate steps to keep information about consumers
−Removed: secure may constitute unfair acts or practices in or affecting commerce in violation of Section 5(a) of the FTC Act.
+Added: Furthermore, according to the FTC, violating consumers’ privacy rights or failing to take appropriate steps to keep information about consumers secure may constitute unfair acts or practices in or affecting commerce in violation of Section 5(a) of the FTC Act.
The GDPR and the UK GDPR regulate our processing of personal data and imposes stringent requirements.
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In the event we are not able to secure indemnification or the indemnification and any insurance coverage is inadequate to cover our losses, we could suffer significant financial, operational, reputational and other harm and our business, financial condition and results of operations could be materially adversely affected.
−Removed: Furthermore, as supervisory authorities issue further guidance on personal data export mechanisms, including circumstances where the standard contractual clauses cannot be used, and/or start taking enforcement action, we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or if we are otherwise unable to transfer personal data between and among countries and regions in which we operate, it could affect the manner in which we provide our services, the geographical location or segregation of our relevant systems and operations.
+Added: Furthermore, as supervisory authorities issue further guidance on personal data export mechanisms, including circumstances where the standard contractual clauses cannot be used, and/or start taking
+Added: enforcement action, we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or if we are otherwise unable to transfer personal data between and among countries and regions in which we operate, it could affect the manner in which we provide our services, the geographical location or segregation of our relevant systems and operations.
+Added: If we are not able to reliably meet our data storage and management or other information technology requirements, or if we experience any technology failures in the delivery of our services over the internet or in the administration of our business, customer satisfaction and our reputation could be harmed and customer contracts may be terminated.
+Added: As part of our current business model, the portion of our software that is delivered over the internet as SaaS is increasing, and we store and manage significant data for our customers, resulting in substantial information technology infrastructure and ongoing technological challenges, which we expect to continue to increase over time.
+Added: If we do not reliably meet these data storage and management requirements, or if we experience any failure or interruption in the delivery of our services over the internet, customer satisfaction and our reputation could be harmed, leading to reduced revenues and increased expenses.
+Added: Our hosting services are subject to service-level agreements and, if we fail to meet guaranteed service or performance levels, we could be subject to customer credits or termination of these customer contracts.
+Added: If the cost of meeting these data storage and management requirements increases, our business, financial condition and results of operations could be harmed.
+Added: Furthermore, we utilize multiple complex integrated software and hardware operating systems, including enterprise resource planning systems, to support our business, and we have a continuous improvement strategy in place to keep our systems and overarching technology stable and in line with our business needs and growth.
+Added: While we employ controlled change management methodologies to plan, test and execute all such system upgrades and improvements, transitioning critical business or accounting functions to upgraded or new processes and systems may require significant capital investments and personnel resources and coordination with third-party software and system providers.
+Added: We cannot assure that our systems will meet our future business needs, that upgrades or new systems will operate as designed or that there will not be associated excessive costs or disruptions in portions of our business in the course of our maintenance, support, upgrade and/or transition of these systems.
+Added: If our information technology systems, upgrades and associated change management are not adequate to support our business and our strategic initiatives, our business, financial condition and results of operations could be harmed.
+Added: Some of our software solutions utilize third-party open source software, and any failure to comply with the terms of one or more of these open source licenses could adversely affect our business, subject us to litigation and create potential liability.
+Added: Some of our software solutions utilize software covered by open source licenses, and we expect to continue to incorporate open source software in our solutions in the future.
+Added: Open source software is often widely accessible, usable and modifiable and may be used by our development team in an effort to reduce development costs and speed up the development process.
+Added: Use of open source software also in some respects entails greater risks than use of third party commercial software, as open source licensors generally do not provide warranties or other contractual protections regarding infringement claims or the quality of the code, including with respect to security vulnerabilities.
+Added: Although we have processes intended to comply with the license requirements in our software, certain open source software licenses require, among other things, that a licensor that distributes the open source software as a component of the licensor’s proprietary software to provide or offer to provide to the customer-licensee part or all of the source code to the licensor’s proprietary software.
+Added: While we have policies against using this type of open source code in our distributed software, if we were to utilize this type of open source code, and if the owner of the copyright of the relevant open source software were to allege that we had not complied with the
+Added: conditions of one or more of these licenses, we could be required to incur significant legal expenses defending against such allegations and could be subject to significant damages, enjoined from the sale of our solutions that contain the open source software and required to comply with onerous conditions or restrictions on these solutions, which could disrupt the distribution and sale of these solutions.
+Added: Litigation or other enforcement actions initiated by a copyright owner could have a negative effect on our business, financial condition and results of operations, or require us to devote additional R&D resources to change our solutions.
+Added: Moreover, we could effectively be required to publicly release the affected portions of our source code, re-engineer all or a portion of our solutions or otherwise be limited in the licensing of our solutions, each of which could reduce or eliminate the value of our solutions.
+Added: Disclosing our proprietary source code could allow our competitors to create similar products with lower development effort and time and ultimately could result in a loss of sales.
+Added: Any of these events could create liability for us and damage our reputation, which could have a material adverse effect on our business, financial condition and results of operations.
We may be unable to adequately enforce or defend our ownership and use of our intellectual property and other proprietary rights.
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The steps we take to protect these rights may not be adequate to prevent misappropriation of our technology by third parties or may not be adequate under the laws of some foreign countries, which may not protect our intellectual property rights to the same extent as do the laws of the United States.
−Removed: Our attempts to protect our intellectual property may be challenged by others or invalidated through
−Removed: administrative process or litigation, and agreement terms that address non-competition are difficult to enforce in many jurisdictions and may not be enforceable in any particular case.
+Added: Our attempts to protect our intellectual property may be challenged by others or invalidated through administrative process or litigation, and agreement terms that address non-competition are difficult to enforce in many jurisdictions and may not be enforceable in any particular case.
In addition, there remains the possibility that others will “reverse engineer” our software products to introduce competing products, or that others will develop competing technology independently.
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Litigation and contested proceedings can also be expensive and time-consuming, and our adversaries in these proceedings may have the ability to dedicate substantially greater resources to prosecuting these legal actions than we can.
−Removed: Third parties may assert infringement claims against us based on existing patents or patents that may be granted in the future, regardless of merit.
+Added: parties may assert infringement claims against us based on existing patents or patents that may be granted in the future, regardless of merit.
We may not be aware of all such intellectual property rights potentially relating to our technology, or we may incorrectly conclude that third-party intellectual property is invalid or that our activities do not infringe such intellectual property.
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If we fail to comply with certain healthcare laws, including fraud and abuse laws, we could face substantial penalties and our business, results of operations, financial condition and prospects could be adversely affected.
−Removed: Even though we do not order healthcare services or bill directly to Medicare, Medicaid or other third-party payors, as a result of contractual, statutory or regulatory requirements, we may be subject to healthcare fraud
−Removed: and abuse laws of both the federal government and the states in which we conduct our business.
−Removed: Because of the breadth of these laws and the narrowness of available statutory and regulatory exceptions, it is possible that some of our business activities could be subject to challenge under one or more of such laws.
+Added: Even though we do not order healthcare services or bill directly to Medicare, Medicaid or other third-party payors, as a result of contractual, statutory or regulatory requirements, we may be subject to healthcare fraud and abuse laws of both the federal government and the states in which we conduct our business.
+Added: Because of the breadth of these laws, ongoing legal and regulatory developments pertaining thereto, and the narrowness of available statutory and regulatory exceptions, it is possible that some of our business activities could be subject to challenge under one or more of such laws.
If we or our operations are found to be in violation of any of the laws described above or any other governmental regulations that apply to us, we may be subject to penalties, including civil and criminal penalties, damages, fines, imprisonment and the curtailment or restructuring of our operations, any of which could have a material adverse effect on our business, financial condition and results of operations.
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If we are unable to generate sufficient cash flow from operations to service our debt and meet our other commitments, we may need to refinance all or a portion of our debt, sell material assets or operations, delay capital expenditures or raise additional debt or equity capital.
−Removed: We may not be able to effect any of these actions on a timely basis, on commercially reasonable terms or at all, and these actions may not be sufficient to meet
−Removed: our capital requirements.
+Added: We may not be able to effect any of these actions on a timely basis, on commercially reasonable terms or at all, and these actions may not be sufficient to meet our capital requirements.
In addition, the terms of our existing or future debt agreements may restrict us from pursuing any of these alternatives.
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Additionally, we have pledged substantially all of our assets as collateral to secure our Credit Agreement.
−Removed: A breach of any of these and certain other covenants could result in a default under our Credit Agreement whereby the lenders could elect to declare all amounts outstanding under our Credit Agreement to be immediately due and payable and terminate any commitments to extend further credit.
+Added: A breach of any of these and certain other covenants could result in a default under our Credit Agreement whereby the lenders could elect to declare all amounts outstanding under our Credit Agreement to be
+Added: immediately due and payable and terminate any commitments to extend further credit.
If we were unable to repay those amounts, the lenders under our Credit Agreement could proceed against the collateral granted to them to secure that indebtedness.
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We assess the potential impairment of goodwill and other intangible assets on at least an annual basis.
−Removed: To the extent goodwill or other indefinite-lived intangibles are
−Removed: impaired, their carrying value will be written down to its implied fair value and a charge will be made to our income from continuing operations.
+Added: To the extent goodwill or other indefinite-lived intangibles are impaired, their carrying value will be written down to its implied fair value and a charge will be made to our income from continuing operations.
Any such impairment charges could have a material adverse effect on our results of operations.
Our ability to use our net operating losses (“NOLs”) and R&D tax credit carryforwards to offset future taxable income may be subject to certain limitations.
−Removed: As of December 31, 2024, we had federal and state NOLs of approximately $6.2 million and $4.9 million, respectively, which are available to reduce future taxable income and expire between 2035 and 2036 and 2029 and 2040, respectively.
−Removed: We had federal R&D tax credit carryforwards of approximately $0.3 million to offset future income taxes, which expire between 2027 and 2048.
+Added: As of December 31, 2025, we had federal and state NOLs of approximately $4.2 million and $3.5 million, respectively, which are available to reduce future taxable income, and some of which expire between 2035 and 2036 and 2030 and 2041, respectively.
+Added: We had federal and state R&D tax credit carryforwards of approximately $0.1 million and $0.02 million, respectively, to offset future income taxes, which expire between 2027 and 2040.
We also had foreign tax credits of approximately $14.6 million, which will start to expire in 2027.
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In addition, we determined that ownership changes occurred in prior periods and therefore our NOLs and R&D tax credit carryforwards reflect the amounts available after considering such limitations.
−Removed: We may experience further ownership changes in the future and/or subsequent changes in our stock ownership (which may be outside our control).
+Added: We may experience further ownership changes in the future and/or subsequent changes in our stock
+Added: ownership (which may be outside our control).
As a result, if, and to the extent that, we earn net taxable income, our ability to use our pre-change NOLs, R&D tax credit carryforwards and disallowed interest expense carryforwards to offset such taxable income may be subject to limitations.
Risks Related to Ownership of Our Common Stock
+Added: The market price of our common stock has been and may continue to be volatile, and may decline regardless of our operating performance, which could cause the value of your investment to decline.
+Added: The market price of our common stock has historically fluctuated in response to numerous factors and may continue to be subject to fluctuations.
+Added: During the year ended December 31, 2025, the closing per share trading price of our common stock fluctuated from a high of $14.47 to a low of $8.03.
+Added: Market volatility, as well as general economic, market or political conditions, could reduce the market price of shares of our common stock regardless of our operating performance.
+Added: In particular, we, along with companies in our sector, have been particularly susceptible to stock price volatility stemming from the integration of AI and machine learning technologies into our business model and market perceptions regarding the impact that developments in AI and machine learning technologies may have on our business, industry and competitive position.
+Added: Additionally, the market price of our common stock may fluctuate as a result of our operating results failing to match our past performance or being below the expectations of public market analysts and investors due to a number of potential factors, including variations in our quarterly operating results or dividends, if any, to shareholders, additions or departures of key management personnel, failure to meet analysts’ earnings estimates, publication of research reports about our industry, the performance of direct and indirect competitors, litigation and government investigations, changes or proposed changes in laws or regulations affecting our business, changes in market valuations of similar companies, announcements by our competitors of significant contracts, strategic transactions or technological or product developments, or adverse publicity or speculation in the press or the investment community about our business or industry.
+Added: In the past, following periods of volatility in the overall market and the market price of a company’s securities, securities class action litigation has often been instituted against these companies.
+Added: This litigation, if instituted against us, could result in substantial costs and a diversion of our management’s attention and resources.
Future sales, or the perception of future sales, of our common stock by us or our existing stockholders in the public market could cause the market price for our common stock to decline.
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Arsenal holds a substantial amount of our outstanding common stock, and its interests may be different than the interests of other holders of our common stock.
−Removed: As of December 31, 2024, Arsenal owns or controls approximately 22.6% of our outstanding common stock, and subject to the terms of the Stockholders Agreement, dated as of November 3, 2022, by and among the Company and Arsenal Saturn Holdings LP and certain affiliated entities (collectively, “Arsenal”), Arsenal maintains the right to nominate up to two board members.
+Added: As of December 31, 2025, Arsenal owns or controls approximately 22.8% of our outstanding common stock, and subject to the terms of the Stockholders Agreement, dated as of November 3, 2022, by and among the Company and certain entities affiliated with Arsenal, Arsenal maintains the right to nominate up to two board members.
In addition, Arsenal has significant influence over the outcome of all matters requiring stockholder approval, including any potential change of control of our company.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.