What changed in this filing

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Item 1. Financial Statements

2025-11-12 compared with 2025-08-14 · 277 added, 179 removed, 498 unchanged (48% of the section changed)

2 unchanged sentences

(In Thousands, Except for Share and Per Share Data)

September 30,

Current assets:

3 unchanged sentences

Prepaid expenses and other current assets

Current assets of discontinued operations

Total current assets

2 unchanged sentences

Operating lease right-of-use assets and other

Noncurrent assets of discontinued operations

Liabilities and Stockholders’ Deficit

6 unchanged sentences

Current operating lease liabilities

Current liabilities of discontinued operations

Total current liabilities

3 unchanged sentences

Long-term operating lease liabilities

Noncurrent liabilities of discontinued operations

Total liabilities

1 unchanged sentence

Stockholders’ equity (deficit):

Class A Common stock, $ 0.001 par value per share, 200,000,000 shares authorized as of June 30, 2025 and December 31, 2024, and 38,081,935 and 30,897,232 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively

Class B Common stock, $ 0.001 par value per share, 20,000,000 shares authorized as of June 30, 2025 and December 31, 2024 and 4,313,406 issued and outstanding as of June 30, 2025 and December 31, 2024

Class A Common stock, $ 0.001 par value per share, 200,000,000 shares authorized as of September 30, 2025 and December 31, 2024, and 40,198,920 and 30,897,232 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively

Class B Common stock, $ 0.001 par value per share, 20,000,000 shares authorized as of September 30, 2025 and December 31, 2024, and 2,351,246 and 4,313,406 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively

Additional paid-in capital

6 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Cost of goods sold

8 unchanged sentences

Other expense (income), net

Loss before provision for income taxes

Income (loss) before provision for income taxes

Income tax expense

Net loss from continuing operations

Income from discontinued operations

dilutive gain on revaluation of warrant liability

Net loss for diluted earnings per share

Net loss from continuing operations per share - basic

Net loss from continuing operations per share - diluted

Net income from discontinued operations per share - basic and diluted

Net loss per share - basic

Net loss per share - diluted

Net income (loss) from continuing operations

Loss from discontinued operations

Net income (loss)

Undistributed net income to participating securities

Net income (loss) attributable to common stockholders

Net income (loss) attributable to common stockholders from continuing operations per share - basic

Net loss per share attributable to common stockholders from continuing operations per share - diluted

Net income (loss) attributable to common stockholders from discontinued operations per share - basic

Net income (loss) attributable to common stockholders from discontinued operations per share - diluted

Net income (loss) attributable to common stockholders per share - basic

Net loss attributable to common stockholders per share - diluted

Weighted average common shares outstanding - basic

5 unchanged sentences

Equity (Deficit)

Balance, March 31, 2025

Issuance of common stock as payment under revenue interest obligation

Issuance of common stock as payment of interest

Exercise of Prefunded Warrants

Balance, June 30, 2025

Issuance of common stock under Employee Stock Purchase Plan

Vesting of restricted stock units, net of shares withheld and taxes paid

Stock-based compensation

Conversion of Class B Common Stock to Class A Common Stock

( 1,962,160 )

Exercise of Prefunded Warrants

Balance, September 30, 2025

Balance, June 30, 2024

Balance, March 31, 2024

Issuance of common stock in connection with registered direct offering, net of issuance costs of $ 1.1 million

Exercises of Common Warrants and Prefunded Warrants

Exercises of Common Warrants

Issuance of common stock under Employee Stock Purchase Plan and exercise of stock options

Vesting of restricted stock units, net of shares withheld and taxes paid

Stock-based compensation

Balance, June 30, 2024

Balance, September 30, 2024

Stockholders'

4 unchanged sentences

Issuance of common stock as payment of interest

Conversion of Class B Common Stock to Class A Common Stock

( 1,962,160 )

Exercise of Prefunded Warrants

2 unchanged sentences

Stock-based compensation

Balance, June 30, 2025

Balance, September 30, 2025

Balance, December 31, 2023

1 unchanged sentence

Exercises of Common Warrants and Prefunded Warrants

Issuance of common stock under Employee Stock Purchase Plan

Issuance of common stock under Employee Stock Purchase Plan and exercise of stock options

Vesting of restricted stock units, net of shares withheld and taxes paid

Stock-based compensation

Balance, June 30, 2024

Balance, September 30, 2024

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

1 unchanged sentence

(In Thousands)

Six Months Ended

Nine Months Ended

September 30,

Adjustments to reconcile net loss to net cash used in operating activities:

6 unchanged sentences

Stock-based compensation

Bad debt expense

Changes in operating assets and liabilities:

9 unchanged sentences

Expenditures for property and equipment

Net cash provided by (used in) investing activities

Net cash used in investing activities

FINANCING ACTIVITIES:

6 unchanged sentences

Proceeds from stock option exercises and issuance of common stock under ESPP

Net cash provided by (used in) financing activities

Net decrease in cash and cash equivalents

Net cash provided by financing activities

Net increase (decrease) in cash and cash equivalents

Cash and cash equivalents, beginning of period

3 unchanged sentences

Issuance of common stock as payment under revenue interest obligation

Operating lease right-of-use assets executed

Additions to operating lease right-of-use assets

Conversion of Common Warrants and Prefunded Warrants to common stock

2 unchanged sentences

Organization and Description of Business

(together with its consolidated subsidiaries, “Elutia” or the “Company”) is a commercial-stage company leveraging its unique understanding of biologics combined with local drug delivery to improve the interaction between implanted medical devices and patients by reducing complications associated with these surgeries.

(together with its consolidated subsidiary, “Elutia” or the “Company”) is a commercial-stage company leveraging its unique understanding of biologics combined with local drug delivery to improve the interaction between implanted medical devices and patients by reducing complications associated with these surgeries.

The Company has developed a portfolio of products using both human and porcine tissue that are designed to be as close to natural biological material as possible.

Elutia’s portfolio of products spans the Device Protection, Women’s Health and Cardiovascular markets.

Elutia’s portfolio of products spans the Women’s Health and Cardiovascular markets.

These products are primarily sold to healthcare providers or commercial partners.

On November 7, 2025, the Company received a letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”), notifying us that, for the last 30 consecutive business days, the closing bid price for our Class A common stock, par value $ 0.001 per share (the “Common Stock”), was below $ 1.00 per share, which is the minimum closing bid price (the “Minimum Bid Price”) required for continued listing on The Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2) (the “Notice”).

The Notice provided a compliance period of 180 calendar days from the date of the Notice, or until May 6, 2026 (the “Compliance Period”), to regain compliance with the Minimum Bid Price requirement.

Summary of Significant Accounting Policies

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Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the Company’s consolidated financial statements and accompanying notes included in the Company's annual report on Form 10-K (“Annual Report”) for the fiscal year ended December 31, 2024.

The financial information as of June 30, 2025 and for the three and six months ended June 30, 2025 and 2024 is unaudited, but in the opinion of management, all adjustments considered necessary for a fair statement of the results for these interim periods have been included.

The financial information as of September 30, 2025 and for the three and nine months ended September 30, 2025 and 2024 is unaudited, but in the opinion of management, all adjustments considered necessary for a fair statement of the results for these interim periods have been included.

The condensed consolidated balance sheet data as of December 31, 2024 was derived from audited financial statements but does not include all disclosures required by GAAP.

The results of the Company’s operations for any interim period are not necessarily indicative of the results that may be expected for any other interim period or any future year or period.

The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries.

The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary.

Intercompany accounts and transactions have been eliminated in consolidation.

On September 8, 2025, Elutia executed an Asset Purchase Agreement (the “APA”) with Boston Scientific Corporation (“BSC”), a Delaware corporation, and Cardiac Pacemakers Inc.

(“CPI”), a Minnesota corporation (collectively with BSC, the “Buyers”).

On October 1, 2025, at the closing of the transactions contemplated by the APA, the Buyers purchased from the Company substantially all of the assets that are related to the Company’s business of researching, developing, administering, operating, commercializing, manufacturing, selling and marketing its cardiac implantable electronic device (“CIED”) products, including its CanGaroo®, CanGaroo® RM, EluPro™ and CIED envelope products, including next generation CIED envelope products (collectively the “CIED Business”).

The assets of the CIED Business constitute substantially all of the assets held in Elutia’s Device Protection segment.

The Buyers are only assuming certain liabilities related to performance of the contracts transferred in the APA.

The APA provides for an aggregate purchase price, subject to certain adjustments pursuant to the terms of the APA, of up to $ 88 million in cash,

with $ 80.3 million (which included a preliminary inventory adjustment of $ 0.3 million) that was paid in cash to Elutia at the closing of the transactions and $ 8 million that was deposited at the closing of the transactions in escrow with a bank for twelve months , which is subject to potential reduction in the event of certain post-closing breaches of representations and warranties within the APA by the Company.

The sale of the CIED Business represents a strategic shift that has a major effect on the Company’s operations and financial results.

Consequently, the Company met the held-for-sale criteria of Accounting Standards Codification (“ASC”) 205-20, Discontinued Operations as of September 30, 2025.

Accordingly, this transaction is accounted for as Discontinued Operations for all periods presented in accordance with ASC 205-20, Discontinued Operations .

Unless indicated otherwise, the information in the notes to the Condensed Consolidated Financial Statements relates to continuing operations.

See Note 4 for further discussion of the divestiture of the CIED Business.

On November 8, 2023, the Company completed the sale of substantially all of the assets relating to its Orthobiologics segment (the “Orthobiologics Business”) to Berkeley Biologics, LLC (“Berkeley”).

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The earn-out payments are equal to 10 % of the actual revenue earned by Berkeley in each of the five years after the closing of the sale from sales of specified Orthobiologics products under the purchase agreement (including improvements, modifications, derivatives and enhancements related to those products).

There were no earn-out payments earned or paid in the six months ended June 30, 2025.

Additionally, the purchase agreement provides for a customary indemnity holdback in the amount of $ 1.5 million to be retained by Berkeley for 24 months after close.

There were no earn-out payments earned or paid in the nine months ended September 30, 2025 or 2024.

Additionally, the purchase agreement provides for a customary indemnity holdback in the amount of $ 1.5 million to be retained by Berkeley for 24 months after closing.

In the purchase agreement, the Company has retained the liabilities arising out of the VBM and FiberCel matters, as described in Note 9, both of which products were part of the Orthobiologics Business.

The Company recognized a gain of $ 6.0 million on the sale of the Orthobiologics Business in the fourth quarter of 2023 and an additional gain of $ 0.2 million in the second quarter of 2024 from an adjustment payment related to the final working capital received by Berkeley at the sale date.

The indemnity holdback is available as a source of recovery for Berkeley for claims of indemnification under the purchase agreement, and some or all of the holdback may be retained by Berkeley if Berkeley is successful in asserting a claim or

claims for indemnification against the Company.

The Company is aware of certain indemnity-related claims raised, including a claim from a former supplier alleging breach of contract.

Based on the Company’s ongoing assessment of these claims, along with the remaining indemnity holdback of $ 1.5 million, the Company does not consider a loss to be probable or estimable as of June 30, 2025.

Should the Company receive incremental proceeds in the future through an earn-out payment or payment of the holdback amount, an additional gain will be recorded upon the receipt of such amounts.

In accordance with Accounting Standards Update (“ASU”) 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (Subtopic 205-40) , the Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the condensed consolidated financial statements are issued.

For the six months ended June 30, 2025, the Company incurred a net loss of $ 13.5 million, and as of June 30, 2025, the Company had an accumulated deficit of $ 243.1 million.

In addition, during the six months ended June 30, 2025, the Company used $ 17.1 million of cash in operating activities and expects to continue to incur cash outflows from operating activities during the remainder of 2025.

Because of the numerous risks and uncertainties associated with the Company’s commercialization and development efforts, the Company is unable to predict when it will become profitable, and it may never become profitable.

The Company’s inability to achieve and then maintain profitability would negatively affect its business, financial condition, results of operations and cash flows.

Furthermore, even if the Company does achieve profitability, it may not be able to sustain or increase profitability on an ongoing basis, or, in general, be able to satisfy its obligations, including those related to the FiberCel Litigation and VBM Litigation described in Note 9, when they become due.

In order to mitigate the current and potential future liquidity issues caused by the matters noted above, the Company may seek to raise capital through the issuance of common stock or debt such as the offerings described in Note 8, issue common stock to satisfy certain obligations in lieu of cash such as the Ligand amendment described in Note 7 or pursue asset sales or other transactions, such as the sale of the Orthobiologics Business described above.

In the future, the Company may also seek to obtain waivers, amendments or other accommodations with lenders or other obligees in order to help manage the Company’s indebtedness and other obligations, such as the May 2025 amendment to the SWK Loan Facility described in Note 6.

Since inception, the Company has financed its operations primarily through amounts borrowed under its credit facilities, proceeds from its initial public offering (“IPO”), sales of its products and more recently, the sale of its Orthobiologics and CIED Businesses and proceeds from follow-on offerings and private placements of its common stock and warrants to purchase its common stock.

The Company’s historical cash outflows have primarily been associated with manufacturing and administrative costs, general and marketing, research and development, clinical activity, purchase of property and equipment used in its production activities, litigation defense and settlement costs and investing in its commercial infrastructure.

For the nine months ended September 30, 2025, the Company incurred a net loss of $ 17.4 million, and as of September 30, 2025, the Company had an accumulated deficit of $ 247.0 million.

In addition, during the nine months ended September 30, 2025, the Company used $ 20.0 million of cash in operating activities.

The Company expects to incur operating losses and negative cash flows from operations for the foreseeable future, as the Company advances its development and commercialization of NXT-41 and NXT-41x.

Because of the numerous risks and uncertainties associated with the Company’s development and commercialization efforts, the Company is unable to predict when it will become profitable, and it may never become profitable.

The future viability of the Company is dependent on its ability to generate cash flows from current or future product sales and/or raise additional capital to finance its operations.

The Company may seek to raise capital through the issuance of common stock or debt such as the offerings described in Note 8 or pursue asset sales or other transactions, such as the sale of the CIED and Orthobiologics Businesses described

However, such transactions may not be successful, and we may not be able to raise additional equity, refinance our debt instruments, sell assets or obtain waivers or amendments to our obligations on acceptable terms, or at all.

As such, based on our current operating plans, we believe there is uncertainty as to whether our future cash flows, along with our existing cash, issuances of additional equity and cash generated from expected future sales will be sufficient to meet our anticipated operating needs through twelve months from the condensed consolidated financial statement issuance date.

Due to these factors, there is substantial doubt about our ability to continue as a going concern within one year after the issuance of the condensed consolidated financial statements.

The accompanying condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

That is, the accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and satisfaction of liabilities in the ordinary course of business.

In accordance with Accounting Standards Update (“ASU”) 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (Subtopic 205-40), the Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the condensed consolidated financial statements are issued.

The Company believes that its existing cash and cash equivalents as of September 30, 2025, along with the proceeds received on October 1, 2025 from the sale of its CIED Business, net of repayment of the SWK debt in conjunction with the sale, will be sufficient to fund its operating expenses and capital expenditure requirements through at least one year after the issuance date of the condensed consolidated financial statements.

If the Company is unable to obtain sufficient funding when needed and/or on acceptable terms, the Company may be required to significantly curtail, delay or discontinue its research and development programs, the manufacture of clinical and commercial supplies, product portfolio expansion, commercialization efforts and/or commercial operations, which could adversely affect its business prospects, or the Company may be unable to continue operations.

Reclassifications

T he Company has determined that its operating and reportable segments are consistent with its major product groupings which in prior periods included Device Protection, Women’s Health and Cardiovascular.

Segment results for the three and nine months ended September 30, 2024, have been recast to conform to the new segment presentation, which now excludes Device Protection due to its divestiture noted above.

Refer to the Segment Information in Note 12.

Use of Estimates

34 unchanged sentences

Inventory, consisting of purchased materials, direct labor and manufacturing overhead, is stated at the lower of cost or net realizable value, with cost determined generally using the average cost method.

At each balance sheet date, the

Company also evaluates inventory for excess quantities, obsolescence or shelf-life expiration.

At each balance sheet date, the Company also evaluates inventory for excess quantities, obsolescence or shelf-life expiration.

This evaluation includes analysis of the Company’s current and future strategic plans, historical sales levels by product, projections of future demand, the risk of technological or competitive obsolescence for products, general market conditions and a review of the shelf-life expiration dates for products.

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The Company combines lease and non-lease elements for office leases.

In March 2025, the Company executed a new lease for 26,598 square feet.

This new facility will be utilized for office, manufacturing and laboratory space.

In March 2025, the Company executed a new lease for 26,598 square feet in Gaithersburg, Maryland.

The lease expires in January 2036 with early termination dates in 2029 and 2033.

2 unchanged sentences

The property was made available for use to Elutia by the landlord in May 2025 and at that time, the Company recognized an ROU asset and liability of $ 2.3 million on the Company’s condensed consolidated balance sheet using an incremental borrowing rate of 12.1 %.

The Company moved its executive offices to this new location in May 2025.

The Company is currently using the new facility for administrative purposes along with laboratory space for product development and anticipates using this facility for commercial production of certain new products, to the extent that marketing authorization for such new products is obtained.

As part of the Company’s divestiture of its CIED Business, Elutia’s lease in Roswell, Georgia was assigned to BSC.

See Note 4 for further discussion of the assets and liabilities divested with the sale and their reporting as assets and liabilities of discontinued operations in the accompanying condensed consolidated balance sheets as of September 30, 2025 and December 31, 2024.

Long-Lived Assets

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If impairment exists, the carrying value of that asset is adjusted to its fair value.

A discounted cash flow analysis is used to estimate an asset’s fair value, using assumptions

that market participants would apply.

A discounted cash flow analysis is used to estimate an asset’s fair value, using assumptions that market participants would apply.

The results of impairment tests are subject to management’s estimates and assumptions of projected cash flows and operating results.

Changes in assumptions or market conditions could result in a change in estimated future cash flows and could result in a lower fair value and therefore an impairment, which could impact reported results.

There were no impairment losses for the six months ended June 30, 2025 or 2024.

There were no impairment losses for the nine months ended September 30, 2025 or 2024.

Warrant Liability

1 unchanged sentence

The warrants issued in connection with the September 2023 private placement, June 2024 registered direct offering and 2025 registered direct offering (see Note 8) are classified as liabilities and are recorded at fair value.

The warrants are subject to re-measurement at each settlement date and at each balance sheet date and any change in fair value is recognized in (gain) loss on revaluation of warrant liability net in the condensed consolidated statements of operations.

The warrants are

subject to re-measurement at each settlement date and at each balance sheet date and any change in fair value is recognized in (gain) loss on revaluation of warrant liability net in the condensed consolidated statements of operations.

Revenue Recognition

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The Company accounts for its stock-based compensation plans in accordance with FASB Accounting Standards Codification (“ASC”) 718, Accounting for Stock Compensation .

ASC 718 requires the measurement and recognition of

compensation expense for all stock-based awards made to employees and directors, including employee stock options and restricted stock units.

ASC 718 requires the measurement and recognition of compensation expense for all stock-based awards made to employees and directors, including employee stock options and restricted stock units.

Stock-based compensation cost is measured at the grant date, based on the calculated fair value of the award, and is recognized as an expense on a straight-line basis over the requisite service period of the entire award.

5 unchanged sentences

There was one customer that represented 14 % of the Company’s accounts receivable as of December 31, 2024.

No customer represented greater than 10% of the Company’s accounts receivable as of June 30, 2025.

No customer represented greater than 10% of the Company’s accounts receivable as of September 30, 2025.

Comprehensive Income (Loss)

Comprehensive income (loss) comprises net income (loss) and other changes in equity that are excluded from net income (loss).

For the six months ended June 30, 2025 and 2024, the Company’s net loss equaled its comprehensive loss and accordingly, no additional disclosure is presented.

For the nine months ended September 30, 2025 and 2024, the Company’s net loss equaled its comprehensive loss and accordingly, no additional disclosure is presented.

The Company uses the asset and liability method of accounting for income taxes.

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tax laws, including provisions related to bonus depreciation and deductions for research and development expenses.

The Company is currently evaluating the impact of the OBBBA on its consolidated financial statements.

Upon adoption, the impact of the OBBBA was not material to the Company’s condensed consolidated financial statements;

however, the Company is assessing the impact of the OBBBA on the projected taxable gain on the sale of its CIED Business in the fourth quarter of 2025.

Recently Issued Accounting Standards

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The Company is currently evaluating any new disclosures that may be required upon adoption of ASU 2024-03.

Divestiture of CIED Business

As described in Note 2, o n September 8, 2025, the Company executed the APA for the sale of its CIED Business and the CIED Business met the criteria for held-for-sale classification as of September 30, 2025 and is reported as discontinued operations in accordance with ASC 205-20 - Discontinued Operations .

The related assets and liabilities of the CIED Business are classified as assets and liabilities of discontinued operations as of September 30, 2025 and December 31, 2024 in the condensed consolidated balance sheets and the results of operations from the CIED Business are reported as discontinued operations in the condensed consolidated statements of operations for the three and nine months ended September 30, 2025 and 2024.

Applicable amounts in the prior year have been recast to conform to this discontinued operations presentation.

The following tables shows the assets and liabilities of the discontinued operations:

September 30,

Carrying amounts of the major classes of assets included in discontinued operations:

Total current assets

Property and equipment, net

Intangible assets, net

Operating lease right-of-use and other assets

Total non-current assets

Total assets of discontinued operations

Carrying amounts of the major classes of liabilities included in discontinued operations:

Current operating lease liabilities

Total current liabilities

Long-term operating lease liabilities

Total liabilities of discontinued operations

In accordance with ASC 205-20, only expenses specifically identifiable and related to a business to be disposed are presented in discontinued operations.

Additionally, since the repayment of the Company’s SWK Loan Facility (see Note 7) was deemed to be contractually required as part of the CIED Business sale, interest expense on the repaid SWK Loan Facility is also classified within discontinued operations.

The following table shows the financial results of the discontinued operations:

Three Months Ended

Nine Months Ended

September 30,

Cost of goods sold

Sales and marketing

General and administrative

Research and development

Total operating expenses

Interest expense

Total operating and investing cash flows of discontinued operations for the nine months ended September 30, 2025 and 2024 are comprised of the following:

Nine Months Ended

September 30,

Significant operating non-cash reconciliation items

Depreciation and amortization

Stock-based compensation

Changes in operating assets and liabilities:

Prepaid expenses and other

Other liabilities

Significant investing items

Expenditures for property and equipment

The divestiture of the CIED Business was completed pursuant to the APA on October 1, 2025.

Stock-Based Compensation

In 2015, the Company established the Elutia Inc.

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In addition, the shares reserved for issuance under the 2020 Plan also include shares reserved but not issued under the 2015 Plan as well as an annual increase as set forth in the 2020 Plan.

As of June 30, 2025, the Company had 1,411,696 shares of Class A common stock available for issuance under the 2020 Plan.

As of September 30, 2025, the Company had 1,352,707 shares of Class A common stock available for issuance under the 2020 Plan.

Stock Options

1 unchanged sentence

The Company’s stock options generally have contractual terms of ten years and vest over a four-year period from the date of grant.

A summary of stock option activity under the Company’s 2015 Plan and 2020 Plan for the six months ended June 30, 2025 is as follows:

A summary of stock option activity under the Company’s 2015 Plan and 2020 Plan for the nine months ended September 30, 2025 is as follows:

Number of Shares

1 unchanged sentence

Outstanding, December 31, 2024

Outstanding, June 30, 2025

Vested and exercisable, June 30, 2025

As of June 30, 2025, there was approximately $ 2.5 million of total unrecognized compensation expense related to unvested stock options.

Outstanding, September 30, 2025

Vested and exercisable, September 30, 2025

As of September 30, 2025, there was approximately $ 1.8 million of total unrecognized compensation expense related to unvested stock options.

These costs are expected to be recognized over a weighted-average period of 1.2 years.

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The expected volatility of the Class A common stock is based on the Company’s historical stock data.

The Company uses a zero -dividend yield assumption as the Company has not paid dividends since inception nor does it

anticipate paying dividends in the future.

The Company uses a zero -dividend yield assumption as the Company has not paid dividends since inception nor does it anticipate paying dividends in the future.

The risk-free interest rate approximates recent U.S.

1 unchanged sentence

The period expense is then determined based on the valuation of the options and is recognized on a straight-line basis over the requisite service period for the entire award.

The following weighted-average assumptions were used to determine the fair value of time-based options granted during the six months ended June 30, 2025 and 2024:

Six Months Ended

The following weighted-average assumptions were used to determine the fair value of time-based options granted during the nine months ended September 30, 2025 and 2024:

Nine Months Ended

September 30,

Expected term (years)

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Dividend yield

The Company has granted stock options that vest upon the achievement of certain share price thresholds for twenty consecutive days of trading at each respective threshold.

The Company has also granted stock options that vest upon the achievement of certain share price thresholds for twenty consecutive days of trading at each respective threshold.

For these stock options, the Company accounted for the awards as market condition awards and used an option pricing model, the Monte Carlo model, to determine the fair value of the respective equity instruments and an expense recognition term of approximately three years .

As of June 30, 2025, there were a total of 345,011 stock options outstanding that are market condition stock option awards.

As of September 30, 2025, there were a total of 345,011 stock options outstanding that are market condition stock option awards.

Restricted Stock Units

1 unchanged sentence

There is no exercise price, and no monetary payment is required for receipt of restricted stock units or the shares issued in settlement of the award.

A summary of the RSU activity under the Company’s 2020 Plan for the six months ended June 30, 2025 is as follows:

A summary of the RSU activity under the Company’s 2020 Plan for the nine months ended September 30, 2025 is as follows:

Number of Shares

1 unchanged sentence

Unvested, December 31, 2024

Unvested, June 30, 2025

The total fair value of the RSUs granted during the six months ended June 30, 2025 was $ 0.3 million.

Unvested, September 30, 2025

The total fair value of the RSUs granted during the nine months ended September 30, 2025 was $ 0.4 million.

For the performance vesting RSUs, the fair value was based on the fair market value of the Company's Class A common stock on the date of grant.

1 unchanged sentence

The respective fair values are amortized to expense on a straight-line basis over the vesting period of generally three to four years .

As of June 30, 2025, $ 3.3 million of unrecognized compensation costs related to RSUs is expected to be recognized over a weighted average period of 1.6 years.

As of September 30, 2025, $ 2.2 million of unrecognized compensation costs related to RSUs is expected to be recognized over a weighted average period of 1.3 years.

The Company has granted RSUs that vest upon the achievement of certain share price thresholds for twenty consecutive days of trading at each respective threshold.

For these RSUs, the Company accounted for the awards as market condition awards and used a Monte Carlo model to determine the fair value of these RSUs as well as the expense recognition term of approximately three years using the graded vesting method.

As of June 30, 2025, there were 252,394 RSUs outstanding that were market condition RSU awards.

As of September 30, 2025, there were 252,394 RSUs outstanding that were market condition RSU awards.

Employee Stock Purchase Plan

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The number of shares reserved under the ESPP will automatically increase on the first day of each fiscal year through January 1, 2030, in an amount as set forth in the ESPP.

As of June 30, 2025, the total shares of Class A common stock authorized for issuance under the ESPP was 1,126,448 , of which 791,675 remained available for future issuance.

During the six months ended June 30, 2025, shares of Class A common stock totaling 31,558 were issued under the ESPP.

As of September 30, 2025, the total shares of Class A common stock authorized for issuance under the ESPP was 1,126,448 , of which 763,965 remained available for future issuance.

During the nine months ended September 30, 2025, shares of Class A common stock totaling 59,268 were issued under the ESPP.

Stock-Based Compensation Expense

Stock-based compensation expense recognized during the three and six months ended June 30, 2025 and 2024 was comprised of the following (in thousands):

Stock-based compensation expense recognized during the three and nine months ended September 30, 2025 and 2024 was comprised of the following (in thousands):

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Sales and marketing

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Total stock-based compensation expense

Inventory as of June 30, 2025 and December 31, 2024 was comprised of the following (in thousands):

Stock-based compensation expense included within discontinued operations totaled $ 0.6 million and $ 0.2 million for the three months ended September 30, 2025 and 2024 and totaled $ 0.9 million and $ 0.8 million, respectively for the nine months ended September 30, 2025 and 2024, respectively.

Inventory as of September 30, 2025 and December 31, 2024 was comprised of the following (in thousands):

September 30,

Raw materials

Work in process

Finished goods

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An initial draw of $ 21 million was made in August 2022, and an additional $ 4 million was made on December 14, 2022.

The SWK Loan Facility also allows for the establishment of a separate, new asset-based revolving loan facility of up to $ 8 million, which has not been entered into to date.

The SWK Loan Facility matures on August 10, 2027 and accrues interest, payable quarterly in arrears.

Principal amortization of the SWK Loan Facility, as amended in September 2024, starts in November 2025.

Principal payments during the amortization period will be limited based on revenue-based caps, although as of June 30, 2025, no such caps are applicable and quarterly principal payments will be in an amount equal to 5 % of the aggregate principal amount funded with the balance paid at maturity.

T he SWK Loan Facility also includes both minimum revenue and liquidity covenants, restrictions as to payment of dividends, and is secured by all assets of the Company, subject to certain customary exceptions.

As of June 30, 2025, Elutia was in compliance with its financial covenants under the agreement governing the SWK Loan Facility (“SWK Loan Facility Agreement”).

The SWK Loan Facility also allowed for the establishment of a separate, new asset-based revolving loan facility of up to $ 8 million, which was not entered into before termination of the SWK Loan Facility, as described below.

T he SWK Loan Facility also included

both minimum revenue and liquidity covenants, restrictions as to payment of dividends, and was secured by all assets of the Company, subject to certain customary exceptions.

As of September 30, 2025, Elutia was in compliance with its financial covenants under the agreement governing the SWK Loan Facility (“SWK Loan Facility Agreement”).

See below for discussion of an amendment to the minimum liquidity covenant in May 2025.

All of the SWK Loan Facility borrowings take the form of Secured Overnight Financing Rate (“SOFR”) loans and bear interest at a rate per annum equal to the sum of an applicable margin of (i) 7.75 % and the “Term SOFR Rate”

(based upon an interest period of 3 months), or (ii) if the Company has elected the PIK Interest option (as defined below), 3.75 % and the “Term SOFR Rate.” The Company may elect a portion of the interest due, to be paid in-kind at a rate per annum of 4.5 % (“PIK Interest”), and such election may be made until November 15, 2025.

The “Term SOFR Rate” is subject to a floor of 2.75 %.

The agreement governing the SWK Loan Facility also includes an exit fee equal to 6.5 % of the aggregate principal amount funded prior to termination plus $ 112,500 .

The weighted average interest rate on the SWK Loan Facility was 12.6 % and 13.6 % for the three and six months ended June 30, 2025 and 2024, respectively .

In May 2025, Elutia entered into an amendment to the SWK Loan Facility.

This amendment, among other things:

(i) allows for 100 % of the interest payment due in May 2025 to be paid as PIK Interest, (ii) removed mandatory repayment obligations related to non-ordinary course asset sales, (iii) allows the Company to request that SWK advance a new term loan in the amount of up to $ 5.0 million, which advance will be in the sole and absolute discretion of SWK and (iv) fixed the amount of the minimum liquidity covenant to be $ 8.0 million.

In consideration for the amendment, the Company agreed to issue SWK 50,000 shares of its Class A Common Stock in a private placement.

All of the SWK Loan Facility borrowings took the form of Secured Overnight Financing Rate (“ SOFR ”) loans and bore interest at a rate per annum equal to the sum of an applicable margin of (i) 7.75 % and the “Term SOFR Rate” (based upon an interest period of 3 months), or (ii) if the Company elected the PIK Interest option (as defined below), 3.75 % and the “Term SOFR Rate.” The Company could elect a portion of the interest due, to be paid in-kind at a rate per annum of 4.5 % (“PIK Interest”), and such election could be made until November 15, 2025.

The “Term SOFR Rate” was subject to a floor of 2.75 %.

The agreement governing the SWK Loan Facility also included an exit fee equal to 6.5 % of the aggregate principal amount funded prior to termination plus $ 112,500 .

The weighted average interest rate on the SWK Loan Facility was 12.3 % and 13.5 % for the three months ended September 30, 2025 and 2024 and 12.5 % and 13.5 % for the nine months ended September 30, 2025 and 2024, respectively.

On August 10, 2022 (the “Closing Date”), the Company issued to SWK Funding LLC a warrant (“SWK Warrant”) to purchase, in the aggregate, up to 187,969 shares of Class A common stock of the Company, $ 0.001 par value per share at an exercise price of $ 6.65 per share.

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The debt discount and deferred financing costs are recognized as interest expense through the maturity of the loan.

In May 2025, Elutia entered into a fourth amendment (the “Fourth Amendment”) to the SWK Loan Facility.

The Fourth Amendment, among other things:

(i) allowed for 100 % of the interest payment due in May 2025 to be paid as PIK Interest, (ii) removed mandatory repayment obligations related to non-ordinary course asset sales, (iii) allowed the Company to request that SWK advance a new term loan in the amount of up to $ 5.0 million, which advance would have been in the sole and absolute discretion of SWK and (iv) fixed the amount of the minimum liquidity covenant to be $ 8.0 million.

In consideration for the Fourth Amendment, the Company agreed to issue SWK 50,000 shares of its Class A Common Stock in a private placement.

In August 2025, the Company entered into a fifth amendment (the “Fifth Amendment”) to the SWK Loan Facility, which, among other things, provided that the following amounts were capitalized into the unpaid principal balance of the SWK Loan Facility:

(i) all accrued and unpaid interest due and owing to the lenders on the payment date in August 2025, (ii) a $ 50,000 amendment fee agreed to by us on June 30, 2025, and (iii) a $ 10,000 amendment fee to be paid pursuant to the Fifth Amendment.

Prior to the May 2025 amendment described above, the SWK Loan Facility Agreement required certain mandatory prepayments, subject to certain exceptions, with:

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Long-term debt was comprised of the following (in thousands):

September 30,

Term Loan Facility, net of unamortized discount and deferred financing costs

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Long-Term Debt

On October 1, 2025, in connection with and through the proceeds of the sale of the Company’s CIED Business described in Note 2, Elutia fully repaid the SWK Loan Facility as required by the terms of the loan agreement.

The outstanding principal, including the accrued exit fee, and accrued interest recognized as of this date totaled approximately $ 26.5 million.

The total payment by the Company to SWK in full satisfaction of the debt was $ 27.8 million.

In addition to the above, the Company finances the annual premiums of certain insurance policies through short-term financing arrangements and includes the liabilities associated with such arrangements within accrued liabilities in accompanying consolidated balance sheets.

The fair value of all debt instruments, which is based on inputs considered to be Level 2 under the fair value hierarchy, approximates the respective carrying values as of June 30, 2025 and December 31, 2024.

The fair value of all debt instruments, which is based on inputs considered to be Level 2 under the fair value hierarchy, approximates the respective carrying values as of September 30, 2025 and December 31, 2024.

Revenue Interest Obligation

On May 31, 2017, the Company completed an asset purchase agreement with CorMatrix Cardiovascular, Inc.

(“CorMatrix”) and acquired all CorMatrix commercial assets and related intellectual property (the “CorMatrix

Acquisition”).

(“CorMatrix”) and acquired all CorMatrix commercial assets and related intellectual property (the “CorMatrix Acquisition”).

As part of the CorMatrix Acquisition, the Company assumed a restructured, long-term royalty obligation (the “Revenue Interest Obligation”) to Ligand Pharmaceuticals Incorporated (“Ligand”) with an estimated present value on the acquisition date of $ 27.7 million.

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Through such amendment, $ 2.2 million in outstanding royalty obligations (royalty obligations for the fiscal quarters ended December 31, 2024 and March 31, 2025) owed by Elutia to Ligand under the Amended Revenue Interest Obligation was satisfied by the issuance of 1,105,528 shares of Elutia’s Class A common stock to Ligand in a transaction registered with the Securities and Exchange Commission.

No additional payments to Ligand have been made during the six months ended June 30, 2025.

Total payments to Ligand during the six months ended June 30, 2024 were $ 5.2 million comprised of the aforementioned 2023 amounts due and a 2024 quarterly minimum payment of $ 1.1 million.

No additional payments to Ligand have been made during the nine months ended September 30, 2025.

Total payments to Ligand during the nine months ended September 30, 2024 were $ 6.3 million comprised of the aforementioned 2023 amounts due and a 2024 quarterly minimum payments of $ 2.2 million.

The Company records the present value of the estimated total future payments under both the Revenue Interest Obligation and Amended Revenue Interest Obligation as a long-term obligation, with the short-term portion being recorded as described below.

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During the second quarter of 2025, the Company identified and corrected an accounting error related to the January 2024 amendment of the Revenue Interest Obligation.

The Company inappropriately recorded a gain instead of accounting for the amendment as a modification.

Company inappropriately recorded a gain instead of accounting for the amendment as a modification.

As a result, the Company recorded a gain of $ 1.4 million recognized in the first quarter of 2024 and overstated interest expense in the subsequent periods.

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However, as of the second quarter of 2025, the revenue interest obligation was understated by $ 0.8 million.

As such, the Company corrected this as an out of period adjustment through a $ 1.4 million increase in “Other expense (income), net” to reverse the original gain and a reduction of $ 0.6 million in “Interest expense, net” to reverse the overstatement of interest expense.

As such, the Company corrected this as an out of period adjustment in June 2025 through a $ 1.4 million increase in “Other expense (income), net” to reverse the original gain and a reduction of $ 0.6 million in “Interest expense, net” to reverse the overstatement of interest expense.

The out of period correction is not material to the condensed consolidated financial statements.

After the effects of these corrections, interest expense related to the Revenue Interest Obligation of approximately $( 0.4 ) million and $ 0.4 million was recorded for the three months ended June 30, 2025 and 2024, respectively and approximately ($ 0.1 ) million and $ 0.9 million was recorded for the six months ended June 30, 2025 and 2024, respectively.

Interest expense related to the Revenue Interest Obligation of approximately $ 0.3 million and $ 0.4 million was recorded for the three months ended September 30, 2025 and 2024, respectively and approximately $ 0.3 million (net of the corrections noted above) and $ 1.3 million was recorded for the nine months ended September 30, 2025 and 2024, respectively.

On October 1, 2025, in connection with sale of the CIED Business described in Note 2, Ligand and the Company further amended the Amended Revenue Interest Obligation.

Such amendment primarily consisted of a consent to the sale of the CIED Business and a release by Ligand of its security and royalty interest in the assets of the CIED Business including the EluPro and CanGaroo products.

The Company’s annual minimum payment requirements of $ 4.4 million per year remain unchanged.

In partial consideration of Ligand entering into the amendment, Elutia paid $ 1.1 million in accrued unpaid royalty obligations to Ligand.

Common Stock and Warrants

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The public offering price for each share of Class A Common Stock was $ 2.50 , and the public offering price for each 2025 Prefunded Warrant was $ 2.499 , for aggregate gross proceeds of approximately $ 15.0 million, before deducting offering expenses.

The 2025 Prefunded Warrants have an exercise price of $ 0.001 per share of Class A Common Stock, are exercisable immediately and will expire when exercised

The 2025 Prefunded Warrants have an exercise price of $ 0.001 per share of Class A Common Stock, are exercisable immediately and will expire when exercised in full.

The Company incurred transaction fees, including commissions and legal fees, of approximately $ 1.3 million in connection with the 2025 Registered Offering, of which $ 1.2 million were allocated to the issuance of the common stock.

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The Company has concluded that the outstanding 2025 Prefunded Warrants, 2024 Prefunded Warrants and 2023 Prefunded Warrants do not meet the equity contract scope exception under ASC 815-40 as in the event of a (i) fundamental transaction such as a merger and (ii) failure to timely deliver warrant shares upon exercise, certain provisions of which may require the Company to adjust the settlement value in a manner that is not consistent with a fixed-for-fixed option pricing model.

As a result, the Company allocated a portion of the gross proceeds from the respective offerings to 2025 Prefunded Warrants, 2024 Prefunded Warrants and 2023 Prefunded Warrants based on their fair values and have recorded such amounts as a warrant liability in the accompanying condensed consolidated balance sheet as of June 30, 2025 and December 31, 2024.

Additionally, the Company allocated a portion of the transaction fees from the 2024 Registered Offering, 2025 Registered Offering and the Private Offering to the respective warrants and recognized the expense within other expense (income), net.

Such expenses totaled $ 0.1 million for the six months ended June 30, 2025.

Such expenses totaled $ 0.1 million for the nine months ended September 30, 2025.

As noted above, the last exercise date for the Common Warrants was July 31, 2024.

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Certain of these exercises ultimately resulted in their conversion to 2023 Prefunded Warrants.

A summary of the warrant activity for the six months ended June 30, 2025 is as follows:

A summary of the warrant activity for the nine months ended September 30, 2025 is as follows:

2023 Prefunded Warrants

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Outstanding, December 31, 2024

Outstanding, June 30, 2025

Outstanding, September 30, 2025

The valuation of the warrants is adjusted to fair value (Level 3) at each subsequent balance sheet date until the warrants are settled.

The following table provides a rollforward of the aggregate fair value of the warrant liability for the six months ended June 30, 2025 (in thousands):

The following table provides a rollforward of the aggregate fair value of the warrant liability for the nine months ended September 30, 2025 (in thousands):

2023 Prefunded Warrants

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Gain on revaluation of warrant liability

Warrant liability, June 30, 2025

Warrant liability, September 30, 2025

The Company has used the price of its Class A Common Stock to estimate the fair value of the 2025 Prefunded Warrants, 2024 Prefunded Warrants and 2023 Prefunded Warrants at each measurement date.

The price of the Company’s Class A Common Stock approximates fair value of the 2025 Prefunded Warrants , 2024 Prefunded Warrants and 2023 Prefunded Warrants due to the exercise price per share of $ 0.001 .

The fair value adjustments, which include a $ 2.2 million gain recognized during the three months ended June 30, 2025, have been recorded as (gain) loss on revaluation of warrant liability in the accompanying condensed consolidated statements of operations for the three and six months ended June 30, 2025.

The Company had previously calculated the fair value of the Common Warrants using the Black-Scholes option pricing model with the following inputs as of June 30, 2024:

The fair value adjustments, which include a $ 5.1 million gain recognized during the three months ended September 30, 2025, have been recorded as (gain) loss on revaluation of

warrant liability in the accompanying condensed consolidated statements of operations for the three and nine months ended September 30, 2025.

The Company had previously calculated the fair value of the Common Warrants using the Black-Scholes option pricing model with the following inputs as of September 30, 2024:

Common stock price

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Dividend yield

Class B Common Stock

During the third quarter of 2025, 1,962,160 shares of the Company’s Class B common stock were converted by the holder to voting Class A common stock.

Commitments and Contingencies

Cook Biotech License and Supply Agreements

Elutia has entered into a license agreement, as amended, with Cook Biotech (“Cook”), now owned by Evergen, for an exclusive, worldwide license to the porcine tissue for use in the Company’s Cardiac Patch, CanGaroo and EluPro products, subject to certain co-exclusive rights retained by Cook (the “Cook License Agreement”).

The term of such license is through the date of the last to expire of the licensed Cook patents, which is anticipated to be July 2031.

In 2017, Elutia entered into a license agreement, as amended, with Cook Biotech (“Cook”), now owned by Evergen, for an exclusive, worldwide license to the porcine tissue for use in the Company’s Cardiovascular, CanGaroo and EluPro products, subject to certain co-exclusive rights retained by Cook.

Along with this license agreement, Elutia entered into a supply agreement whereby Cook would be the exclusive supplier to Elutia of licensed porcine tissue.

On October 1, 2025, in connection with the sale of the CIED Business described in Note 2, the Company entered into amendments to both the license (the “Amended License Agreement”) and supply agreements such that the Amended License Agreement removed all products divested with the sale of the CIED Business and includes only the Company’s remaining Cardiovascular products.

Both agreements expire on December 31, 2028.

Under certain limited circumstances, Elutia has the right to manufacture the licensed product and pay Cook a royalty of 3 % of sales of the Elutia-manufactured tissue.

The supply agreement expires on the same date as the related license agreement.

No royalties were due or paid to Cook during the six months ended June 30, 2025 or 2024.

The Cook License Agreement also provides for a worldwide exclusive license to the porcine tissue for use with neuromodulation devices in addition to cardiovascular devices and includes license fee payments of $ 0.1 million per year in each of the years 2021 through 2026.

Such license payments would accelerate if Elutia undergoes a change in control,

as defined in the Cook License Agreement.

The Company, in its sole discretion, can terminate the Cook License Agreement at any time.

No royalties were due or paid to Cook during the nine months ended September 30, 2025 or 2024.

The Amended License Agreement includes license fee payments of $ 0.1 million to be paid by the Company in October 2025 and 2026.

The Company, in its sole discretion, can terminate the Amended License Agreement at any time.

Legal Proceedings

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Since September 2021, 110 product liability lawsuits or claims have been filed or asserted against the Company involving FiberCel.

As of June 30, 2025, there were 47 active lawsuits or claims against the Company, including 34 lawsuits or claims where settlements have been reached but had not yet been paid by quarter-end.

The lawsuits, which have been filed against Elutia, certain Medtronic entities, and others, allege that the plaintiffs were exposed to and/or contracted tuberculosis and/or suffered substantial symptoms and complications following the implantation of FiberCel during orthopedic fusion operations.

As of September 30, 2025, there were 44 active lawsuits or claims against the Company, including 38 lawsuits or claims where settlements have been reached but had not yet been paid by quarter-end and six lawsuits which have not yet been settled or adjudicated.

The lawsuits, which have been filed against Elutia, certain Medtronic entities, and others, allege that the plaintiffs were exposed to and/or contracted tuberculosis and/or suffered

substantial symptoms and complications following the implantation of FiberCel during orthopedic fusion operations.

Such lawsuits were filed in various U.S.

federal courts and in state courts in Indiana, Delaware, Florida, Maryland and Ohio.

federal courts and in state courts in Indiana, Pennsylvania, Delaware, Florida, Maryland and Ohio.

The Company refers to all of the aforementioned litigation, or claim notices, collectively as the “FiberCel Litigation.”

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Based on our discussions with the CDC, the Company believes that a total of 36 patients were treated with product from the single donor lot.

As of June 30, 2025, there were 13 active lawsuits or claims filed or asserted against the Company.

As of September 30, 2025, there were 13 active lawsuits or claims filed or asserted against the Company.

The lawsuits, which have been filed against Elutia and others, allege that the plaintiffs were exposed to and/or contracted tuberculosis and/or suffered substantial symptoms and complications following the implantation of VBM during orthopedic fusion operations.

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(“Medtronic”) in the Superior Court of the State of Delaware.

The Company’s complaint alleges breach of the 2019 Tissue Product Supply Agreement (the “Supply Agreement”) between the Company and Medtronic.

In particular, the complaint alleges that Medtronic did not honor its contractual obligations to obtain insurance coverage and to defend and indemnify the Company for over 100 lawsuits against the Company alleging claims arising from the use of FiberCel products distributed by Medtronic.

The Company’s operative complaint alleges breach of the 2019 Tissue Product Supply Agreement (the “Supply Agreement”) between the Company and Medtronic.

In particular, the complaint alleges that Medtronic did not honor its contractual obligations to defend and indemnify the Company for over 100 lawsuits against the Company alleging claims arising from the use of FiberCel products distributed by Medtronic and that Medtronic concealed and misrepresented an insurance policy potentially applicable to those FiberCel-related lawsuits.

The complaint does not specify the amount of damages owed by Medtronic for these breaches.

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The counterclaim does not specify the amount of any alleged damages.

On October 15, 2024, Medtronic filed a motion to dismiss Elutia’s claims.

The court held a hearing on January 9, 2025, and a decision was rendered by the court on April 8, 2025.

In its decision, the court dismissed the Company’s claim with respect to Medtronic’s failure to obtain insurance coverage, but allowed the Company to continue with its claim that Medtronic

breached its indemnity obligations to Elutia.

On September 19, 2025, Medtronic filed a partial motion to dismiss some of the claims in Elutia’s current complaint.

On October 17, 2025, Elutia filed an opposition to that motion.

The court has not set a hearing or rendered a decision on the partial motion to dismiss.

Discovery is ongoing in the case.

Given the early stages of this matter and the Company’s intention to vigorously defend Medtronic’s counterclaim, we do not consider a loss to be probable or estimable at this time.

Tiger Litigation

On October 21, 2025, Tiger Aesthetics Medical, LLC (“Tiger”) filed an action against Elutia in the Superior Court of the State of Delaware.

The Complaint alleges breach of contract and related claims related to the 2023 distribution agreement (the “Tiger Distribution Agreement”) between the Company and Tiger as well as the August 2025 letter of intent (the “LOI”) for the possible sale by the Company to Tiger of certain assets and rights.

The complaint does not specify the amount of any alleged damages.

Given the early stages of this matter and the Company’s intention to vigorously defend against Tiger’s claims, Elutia does not consider a loss to be probable or estimable at this time.

Elutia terminated the Tiger Distribution Agreement effective October 25, 2025.

Additionally, the LOI expired on October 25, 2025.

Contingent Liability for Legal Proceedings

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In total, Elutia’s liability in 64 of the cases has been settled for a total cash outlay of $ 22.5 million, with $ 9.6 million of such total settlement outlays having been paid through insurance proceeds.

For the remaining 47 cases, the Company estimated a probable loss related to each case and has recorded a liability at a total estimated amount of $ 13.3 million at June 30, 2025, which is recorded as Contingent Liability for Legal Proceedings in the accompanying condensed consolidated balance sheets.

Such liability includes $ 11.1 million for which the settlements have been reached but had not yet been paid by quarter-end.

For the remaining 44 cases (which excludes one case that has been dismissed and one case where the statute of limitations has elapsed), the Company estimated a probable loss related to each case and has recorded a liability at a total estimated amount of $ 12.7 million at September 30, 2025, which is recorded within Contingent Liability for Legal Proceedings in the accompanying

condensed consolidated balance sheets.

Such liability includes $ 12.0 million for the 38 cases in which the settlements have been reached but had not yet been paid by quarter-end and $ 0.7 million for the six cases which have not yet been settled or adjudicated.

In order to reasonably estimate the liability for the unsettled FiberCel Litigation cases, the Company, along with outside legal counsel, has assessed a variety of factors, including (i) the extent of the injuries incurred, (ii) recent experience on the settled claims, (iii) settlement offers made to the other parties to the litigation and (iv) any other factors that may have a material effect on the FiberCel Litigation.

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In total, Elutia’s liability in 13 of the cases has been settled for a total cash outlay of approximately $ 1.5 million.

For the remaining 23 cases (which includes unasserted claims that the Company believes are probable of assertion and excludes one case where the statute of limitations has elapsed), the Company estimated a probable loss at an estimated amount of $ 3.7 million at June 30, 2025, which is recorded as Contingent Liability for Legal Proceedings in the accompanying consolidated balance sheets.

Such liability includes $ 0.1 million for which a settlement has been reached but had not yet been paid by quarter-end.

For the remaining 21 cases (which includes unasserted claims that the Company believes are probable of assertion and excludes one case that has been dismissed and one case where the statute of limitations has elapsed), the Company estimated a probable loss at an estimated amount of $ 3.7 million at September 30, 2025, which is recorded within Contingent Liability for Legal Proceedings in the accompanying consolidated balance sheets.

The expense related to this estimate was recorded within Litigation costs, net in the accompanying consolidated statement of operations, with the entirety of such expense offset by insurance recoveries received or receivable as further described below.

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The determination that the recorded receivables are probable of collection is based on the terms of agreements reached in respect of indemnity and contribution claims as well as the advice of the Company’s outside legal counsel.

These receivables as of June 30, 2025 totaled $ 4.3 million and are recorded as Insurance Receivables of Litigation Costs in the accompanying consolidated balance sheets.

As of June 30, 2025, all amounts recorded as Insurance Receivables of Litigation Costs related to the VBM Litigation, and additional insurance remains available to cover the future cost of the VBM Litigation and related defense costs.

These receivables as of September 30, 2025 totaled $ 4.6 million and are recorded as Insurance Receivables of Litigation Costs in the accompanying consolidated balance sheets.

As of September 30, 2025, all amounts recorded as Insurance Receivables of Litigation Costs relate to the VBM Litigation, and additional insurance remains available to cover the future cost of the VBM Litigation and related defense costs.

Conversely, the Company has no more insurance to cover the cost of the FiberCel Litigation and the related defense costs.

As of both June 30, 2025 and 2024, the Company was not a party to, or aware of, any legal matters or claims with material financial exposure, except for the FiberCel Litigation, VBM Litigation and Medtronic matter.

As of both September 30, 2025 and 2024, the Company was not a party to, or aware of, any legal matters or claims with material financial exposure, except for the FiberCel Litigation, VBM Litigation, Medtronic matter and Tiger matter.

Net Income (Loss) Per Share

Three Months Ended

Six Months Ended

Nine Months Ended

(in thousands, except share and per share data)

Net loss from continuing operations

Income from discontinued operations

dilutive gain on revaluation of warrant liability

Net loss for diluted earnings per share

September 30,

Net income (loss) from continuing operations

Undistributed net income to participating securities

Net income (loss) from continuing operations attributable to common stockholders

Loss attributable to common stockholders from discontinued operations

Net income (loss) attributable to common stockholders

dilutive gain on revaluation of warrant liability, net of addback for undistributed net income to participating securities

Net loss attributable to common stockholders for diluted earnings per share

Weighted average number of common shares - basic

Effect of dilutive prefunded warrants

Effect of dilutive common and prefunded warrants

Weighted average number of common shares - diluted

Net loss from continuing operations per share - basic

Net loss from continuing operations per share - diluted

Net income from discontinued operations per share - basic and diluted

Net loss per share - basic

Net loss per share - diluted

Net income (loss) attributable to common stockholders from continuing operations per share - basic

Net loss per share attributable to common stockholders from continuing operations per share - diluted

Net income (loss) attributable to common stockholders from discontinued operations per share - basic

Net income (loss) attributable to common stockholders from discontinued operations per share - diluted

Net income (loss) attributable to common stockholders per share - basic

Net loss attributable to common stockholders per share - diluted

Basic net loss per share is computed by dividing net loss for the period by the weighted average number of common shares outstanding during the period.

Diluted net loss per share is computed by dividing the net loss, adjusted for gains on the revaluation of warrant liability (see Note 9), by the weighted average number of common shares outstanding for the period, adjusted for the dilutive effect of shares of common stock equivalents resulting from the exercise of the Common Warrants, 2023

Prefunded Warrants, 2024 Prefunded Warrants and 2025 Prefunded Warrants.

The treasury stock method was used to calculate the potential dilutive effect of these common stock equivalents.

Certain of the Company’s potential dilutive securities have been excluded from the computation of diluted net loss per share as the effect would be anti-dilutive.

The Company excluded the following potential common shares, presented based on amounts outstanding at period end, from the computation of diluted net loss per share:

Six Months Ended

Three Months Ended

Nine Months Ended

September 30,

Options to purchase common stock

Restricted stock units

Common Warrants

Class A common stock warrants

2023 Prefunded Warrants

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Segment Information

With the divestiture in 2023 of the Orthobiologics Business, the Company now operates in three segments.

The Company determined its operating and reportable segments to be consistent with its major product groupings – Device Protection, Women’s Health and Cardiovascular.

With the divestiture of the CIED Business, the Company now operates in two segments.

The Company determined its operating and reportable segments to be consistent with its major product groupings – Women’s Health and Cardiovascular.

The accounting policies of the segments are the same as those described in the summary of significant accounting policies.

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Asset information is not provided as the Company's CODM does not regularly review or utilize detailed asset data to assess segment performance.

For the three months ended June 30, 2025, the Company’s segment gross profit was comprised of the following (in thousands):

Device Protection

For the three months ended September 30, 2025, the Company’s segment gross profit was comprised of the following (in thousands):

Women's Health

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Segment gross profit

No customer for the three months ended June 30, 2025 represented greater than 10% of total net sales.

For the six months ended June 30, 2025, the Company’s segment gross profit was comprised of the following (in thousands):

Device Protection

For the nine months ended September 30, 2025, the Company’s segment gross profit was comprised of the following (in thousands):

Women's Health

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Segment gross profit

The net sales for the six months ended June 30, 2025 include the revenues derived from one customer which represents 11 % of total net sales.

Such customer is included within the Women’s Health segment.

For the three months ended June 30, 2024, the Company’s segment gross profit was comprised of the following (in thousands):

Device Protection

For the three months ended September 30, 2024, the Company’s segment gross profit was comprised of the following (in thousands):

Women's Health

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Segment gross profit

The net sales for the three months ended June 30, 2024 include the revenues derived from one customer which represents 11 % of total net sales.

Such customer is included within the Women’s Health segment.

Additionally, the net sales for the three months ended June 30, 2024 include the revenues derived from another customer which represents 15 % of total net sales.

Such customer is included within the Cardiovascular segment.

For the six months ended June 30, 2024, the Company’s segment gross profit was comprised of the following (in thousands):

Device Protection

For the nine months ended September 30, 2024, the Company’s segment gross profit was comprised of the following (in thousands):

Women's Health

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Segment gross profit

The net sales for the six months ended June 30, 2024 include the revenues derived from one customer which represents 14 % of total net sales.

Such customer is included within the Women’s Health segment.

Additionally, the net sales for the three months ended June 30, 2024 include the revenues derived from another customer which represents 11 % of total net sales.

Such customer is included within the Cardiovascular segment.

The following table is a reconciliation of segment gross profit to the consolidated loss before provision for income taxes for the three and six months ended June 30, 2025 and 2024, (in thousands):

One customer in the Women’s Health segment, Tiger, represented 16 %, 26 %, 21 % and 24 % of total sales for the three months ended September 30, 2025 and 2024 and the nine months ended September 30, 2025 and 2024, respectively.

The distribution agreement with Tiger was terminated by the Company effective in October 2025.

Additionally, another customer in the Women’s Health segment represented 13 %, 9 %, 9 % and 5 % of total sales for the three months ended September 30, 2025 and 2024 and the nine months ended September 30, 2025 and 2024, respectively.

One customer in the Cardiovascular segment, LeMaitre Vascular, represented 0 %, 13 %, 4 % and 16 % of total sales for the three months ended September 30, 2025 and 2024 and the nine months ended September 30, 2025 and 2024, respectively.

The distribution agreement with LeMaitre Vascular was terminated by the Company in April 2025.

The following table is a reconciliation of segment gross profit to the consolidated loss before provision for income taxes for the three and nine months ended September 30, 2025 and 2024, (in thousands):

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Segment gross profit

9 unchanged sentences

Loss before provision for income taxes

During the six months ended June 30, 2025 and 2024, the Company did not have any material international product sales, and the Company did not own any long-lived assets outside the United States.

During the nine months ended September 30, 2025 and 2024, the Company did not have any material international product sales, and the Company did not own any long-lived assets outside the United States.

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

What changed 10-Q

Item 1. Financial Statements