What changed in this filing

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Item 1. Business

2026-03-03 compared with 2025-03-04 · 140 added, 129 removed, 658 unchanged (29% of the section changed)

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While antiepileptic drugs are considered first-line treatment and are effective at controlling seizures in a large portion of the epilepsy population, approximately one-third of epilepsy patients are considered drug-resistant because they do not achieve complete seizure control or cannot tolerate the side effects of these drugs.

According to the International League Against Epilepsy, or ILAE, drug-resistant epilepsy, or DRE, is defined as a patient failing to achieve sustained seizure freedom after trying two antiseizure medications.

According to the International League Against Epilepsy, or ILAE, drug-resistant epilepsy is defined as a patient failing to achieve sustained seizure freedom after trying two antiseizure medications.

These drug-resistant epilepsy patients struggle with a variety of life-impacting challenges including psychological dysfunction, social stigmatization, reduced quality of life, and increased risk of mortality.

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We estimate that only approximately 20% of drug-resistant focal epilepsy patients have a focus that is both safe to remove and likely to result in seizure control if removed, and are also willing to undergo the procedure.

The ILAE guidelines state that DRE patients who may not appear to be appropriate candidates for resective or ablative epilepsy surgery should still be referred to a tertiary epilepsy center to evaluate other potential interventions.

The ILAE guidelines state that drug-resistant epilepsy patients who may not appear to be appropriate candidates for resective or ablative epilepsy surgery should still be referred to a tertiary epilepsy center to evaluate other potential interventions.

There are currently two other neuromodulation devices, Vagus Nerve Stimulation, or VNS, and Deep Brain Stimulation, or DBS, that are also approved to address the approximately 80% of drug-resistant focal epilepsy patients who are not ideal candidates for resective or ablative surgery.

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We have established a significant account base at these CECs.

Given the concentrated and underpenetrated nature of our target market, we believe there is a significant opportunity to efficiently drive higher adoption and utilization within these centers, grow our account base, and expand our referral pathways to increase the number of drug-resistant patients referred to Level 4 CECs.

Given the concentrated and underpenetrated nature of our target market, we believe there is a significant opportunity to efficiently foster higher adoption and utilization within these centers, grow our account base, and expand our referral pathways to increase the number of drug-resistant patients referred to Level 4 CECs.

Additionally, as a result of the approval of a PMA-S in 2023, we are now able to expand our commercial efforts to the approximately 1,800 additional epileptologists as well as the remaining functional neurosurgeons practicing outside of Level 4 CECs.

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We are also pursuing studies to support label expansion for our RNS System in additional epilepsy populations.

In February 2025, we received approximately $69.8 million in net proceeds from the sale of 7,475,000 shares of our common stock, including 975,000 shares from the exercise of the underwriters’ option to purchase additional shares, at a public offering price of $10.00 per share.

In February 2025, we received $69.7 million in net proceeds from the sale of 7,475,000 shares of our common stock, including 975,000 shares from the exercise of the underwriters’ option to purchase additional shares, at a public offering price of $10.00 per share.

We used $49.5 million of the net proceeds from the offering to repurchase all of the shares held by our significant stockholder, KCK Ltd.

We intend to use the remaining net proceeds from the offering for general corporate purposes, which may include clinical trial and other research and development expenses, selling, general and administrative expenses, debt reduction and working capital.

We are using the remaining net proceeds from the offering for general corporate purposes, including, but not limited to, sales and marketing, clinical trial, and other research and development expenses, general and administrative expenses, debt reduction and working capital.

Our Growth Strategies

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We believe the following strategies will contribute to growth in initial patient implants and advance our mission to dramatically improve clinical outcomes and quality of life for patients living with epilepsy and other disabling brain disorders:

• Drive adoption and utilization of our RNS System within Level 4 CECs .

• Increase adoption and utilization of our RNS System within Level 4 CECs .

Our commercial efforts have primarily been focused on the Level 4 CECs where drug-resistant focal epilepsy patients are actively seeking treatment.

In 2024 there were approximately 200 Level 4 CECs in the United States.

In 2025 there were over 230 Level 4 CECs in the United States.

We estimate that there are approximately 1,200 epileptologists affiliated with these centers, approximately five to seven per center on average.

We believe the remaining epileptologists in our existing accounts who are not currently prescribing the RNS System represent a significant potential opportunity to drive efficient growth.

Our partnership with DIXI Medical further enhances our ability to drive adoption and utilization by giving our representatives access to epilepsy monitoring units in Level 4 CECs, generating earlier opportunities to provide education and awareness about the RNS System.

We believe the remaining epileptologists in our existing accounts who are not currently prescribing the RNS System represent a significant potential opportunity to foster efficient growth.

• Expand RNS System access outside of Level 4 CECs, in the community .

Our sales team has begun to target epileptologists and functional neurosurgeons practicing outside of Level 4 CECs to expand access to RNS therapy, both in the community and through referral of patients to Level 4 CECs.

As we expand our footprint, we plan to continue to drive increased adoption and utilization of our RNS System within new and existing accounts by (i) growing the number of epileptologists recommending our system within each customer account, (ii) increasing utilization of our system by prescribers, and (iii) expanding our referral pathways to increase the number of patients with drug-resistant epilepsy that are referred to CECs for the care that they need.

Since 2023, our sales team has targeted epileptologists and functional neurosurgeons practicing outside of Level 4 CECs to expand access to RNS therapy, both in the community and through referral of patients to Level 4 CECs.

As we expand our footprint, we plan to continue to increase adoption and utilization of our RNS System within new and existing accounts by (i) growing the number of epileptologists recommending our system within each customer account, (ii) increasing utilization of our system by prescribers, and (iii) expanding our referral pathways to increase the number of patients with drug-resistant epilepsy that are referred to CECs for the care that they need.

We believe that with incremental additional resources, our focused commercial organization will be able to grow adoption and utilization both at Level 4 CECs and in the community.

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The remaining patients include approximately 40%, or 20,000 patients with drug-resistant generalized epilepsy and approximately 12%, or 6,000 patients under the age of 18 with drug-resistant focal epilepsy.

Of the patients with generalized epilepsy, approximately 50% of those patients have idiopathic generalized epilepsy.

Supported by a growing body of evidence published in peer-reviewed journals, we believe that our current RNS System may be able to effectively treat these expanded patient populations, and we are pursuing clinical studies to support label expansion for these indications.

In March 2024, we finished implanting patients in our clinical trial to evaluate RNS System use in the generalized epilepsy population.

We do not believe we will need to modify our RNS System for potential use in patients under the age of 18 or in generalized epilepsy;

In December 2025, we filed a PMA-S application to the FDA seeking to expand the labeled indication for the RNS System to include patients with drug-resistant idiopathic generalized epilepsy.

We do not believe we will need to modify our RNS System for potential use in patients under the age of 18 or in idiopathic generalized epilepsy;

however, we will need to complete our clinical studies and obtain FDA approval prior to marketing the RNS System for these indications.

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Pursuant to this agreement, we provide information to Rapport that will help evaluate the impact of their product candidate on certain biomarkers of patients with focal onset seizures.

We may enter into similar collaborations with other companies.

We have entered into a subsequent agreement with Rapport for continued work.

We have entered into a similar collaboration with another company and plan to continue to evaluate additional opportunities for such collaborations.

• Expand into international markets .

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While we are presently focused on addressing the significant domestic market opportunity, we believe our RNS System offers an attractive value proposition for patients, providers, and payors in the large potential market outside of the United States and may additionally seek to expand our operations to reach the approximately 16.5 million drug-resistant epilepsy patients globally.

While our RNS System is not yet approved for sale outside the United States, other than limited case-by-case approvals pursuant to a special program in Canada, if we determine to expand internationally, we will plan to pursue regulatory approvals and reimbursement with a priority on markets in which we see significant potential opportunity.

In late 2025, after strategic analysis of regulatory and market considerations, we entered into a narrowly-scoped distribution agreement with an Israeli distributor to commence limited sales of the RNS System in Israel, where regulatory approval has been obtained.

Since the commencement of this relationship, a small number of cases have been performed in Israel.

In 2025, the revenue generated from those cases is slightly less than the 2025 revenue generated from the limited special access program in Canada, where the RNS System may be approved on a case-by-case basis.

If and when we determine to further expand internationally, we will

continue to pursue regulatory approvals and reimbursement with a priority on markets in which we see significant potential opportunity.

• Pursue additional indications outside of epilepsy .

We believe our versatile, closed-loop, brain-responsive neuromodulation platform has potential applications in other brain disorders including depression, memory disorders, and post-traumatic stress disorder.

For each of these conditions, we are collaborating with

academic investigators in early IDE feasibility studies using our RNS System in patients.

For each of these conditions, we are collaborating with academic investigators in early IDE feasibility studies using our RNS System in patients.

In the future, depending on the outcome of these studies, we may seek regulatory approval to commercialize our technology for these or other indications.

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The electrodes on the leads sense electrical activity from the brain, provide targeted stimulation only when abnormal activity is detected, and record iEEG data that is stored in the neurostimulator and transmitted wirelessly to a secure portal for remote review by the patients’ clinicians.

Once fully programmed, patients do not feel the stimulation bursts, which are typically 100 to 200 milliseconds long.

Once fully programmed, patients do not feel the

stimulation bursts, which are typically 100 to 200 milliseconds long.

Because our RNS System provides targeted, responsive stimulation only when abnormal electrical activity is detected, patients receive approximately three minutes of stimulation on average per day and do not experience stimulation-related side effects at therapeutic settings.

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As we collect iEEG data from our RNS System, our database of iEEG records continues to grow.

As of December 31, 2024, over 6,000 epilepsy patients have received our RNS System, yielding an extensive database of over nineteen million iEEG records.

As of December 31, 2025, over 8,000 epilepsy patients have received our RNS System, yielding an extensive database of over twenty-two million iEEG records.

We believe that we are able to continue to learn and innovate by leveraging this database and our monitoring and data analytics capabilities, thereby improving and enhancing our products and creating actionable insights for clinicians that improve clinical outcomes for patients.

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Once an adult patient has been determined to have drug-resistant focal epilepsy, we believe the patient should be considered for our RNS System.

Our RNS System is initially implanted by a neurosurgeon in an inpatient procedure.

Our RNS System is initially implanted by a neurosurgeon in an inpatient

Detection is turned on at the end of the implant procedure when the neurostimulator is placed.

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Prior to the first in-person follow up visit, which typically occurs approximately two weeks to four weeks after the implant procedure, an epileptologist will review the iEEG data recorded by our RNS System and identify patient specific patterns that are associated with the early onset of seizures.

During the follow-up visit, the epileptologist will make

programming adjustments to the device’s detection parameters in order to optimize for early detection.

During the follow-up visit, the epileptologist will make programming adjustments to the device’s detection parameters in order to optimize for early detection.

Once the patient-specific detection parameters are established, the epileptologist will turn on the stimulation feature, activating the closed-loop treatment of our RNS System.

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Replacement procedures are typically performed on an outpatient basis and take approximately one hour.

Clinicians are able to view the device’s battery status through our Patient Data Management System or on our Physician Tablet, and can plan accordingly with the patient for replacement procedures.

Clinicians are able to view the device’s battery status through our PDMS or on our Physician Tablet, and can plan accordingly with the patient for replacement procedures.

In 2019, more than 90% of patients whose RNS System reached the end of its battery life chose to have a replacement RNS System implanted.

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Clinical Data Supporting Our RNS System

The safety, effectiveness.

and clinical benefits of our RNS System are supported by data from four multi-center, FDA approved prospective clinical studies representing nearly 600 patients and multiple retrospective studies reporting real-world outcomes.

The safety, effectiveness and clinical benefits of our RNS System are supported by data from four multi-center, FDA approved prospective clinical studies representing nearly 600 patients and multiple retrospective studies reporting real-world outcomes.

Our robust and growing body of clinical evidence, which includes nine-year follow-up with over 3,400 years of patient data, provides the largest and longest published prospective clinical data set in the field of neuromodulation devices for epilepsy.

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Data from the Pivotal Study supported FDA PMA approval of our RNS System.

Patients from the Feasibility and Pivotal Studies were subsequently enrolled in our LTT study that followed these patients for an additional seven years, culminating in a total of nine years of follow-up data.

Patients from the Feasibility and Pivotal Studies were subsequently enrolled in our LTT that followed these patients for an additional seven years, culminating in a total of nine years of follow-up data.

We are currently conducting a prospective Post-Approval Study evaluating “real world” outcomes across more than 300 additional patients.

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As shown in the graph below, there were statistically significant sustained improvements in overall QOL as well as in every subdomain of QOL for patients who began treatment less than ten years after epilepsy onset at both one and two years of follow-up.

Long-Term Treatment (LTT) Study

The LTT study was a seven-year prospective, open-label study that followed patients originally treated in either the Feasibility or Pivotal Study.

Long-term Treatment Trial

The Long-term Treatment Trial, or LTT, was a seven-year prospective, open-label study that followed patients originally treated in either the Feasibility or Pivotal Study.

In total, this provided approximately nine years of prospective data on the safety and efficacy of our RNS System.

The LTT study, which enrolled 230 patients, is the largest and longest prospective trial published in the field of neuromodulation to date and provided additional evidence that our RNS System is safe, reduces seizure frequency, and improves QOL in adults with drug-resistant focal epilepsy with one or two seizure foci.

The LTT, which enrolled 230 patients, is the largest and longest prospective trial published in the field of neuromodulation to date and provided additional evidence that our RNS System is safe, reduces seizure frequency, and improves QOL in adults with drug-resistant focal epilepsy with one or two seizure foci.

Enrolled patients were studied over a median follow-up of 8.97 years, representing 1,895 cumulative patient-implant years.

The primary effectiveness objective of the LTT study was to evaluate the long-term efficacy of our RNS System in reducing the frequency of disabling seizures in patients who participated in the Feasibility Study or Pivotal Study.

The primary effectiveness objective of the LTT was to evaluate the long-term efficacy of our RNS System in reducing the frequency of disabling seizures in patients who participated in the Feasibility Study or Pivotal Study.

As indicated in the figure below, the median percent reduction in seizure frequency improved from 44% after one year to 75% at nine years.

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Post-Approval Study

We are currently engaged in follow up and data collection for our FDA-mandated prospective open-label “real-world” study of our RNS System in drug-resistant focal epilepsy patients with a planned follow up period of five years, or the Post-approval Study.

As of November 2024, all patients in the Post-approval Study have completed three years of follow up, and the associated safety and effectiveness data have been submitted to and accepted by the FDA.

We are currently engaged in follow up and database lock activities for our FDA-mandated prospective open-label “real-world” study of our RNS System in drug-resistant focal epilepsy patients with a planned follow up period of five years, or the Post-approval Study.

In April 2025 at the American Academy of Neurology Annual Meeting, we announced our primary effectiveness endpoint data in the Post-approval Study.

Of the 324 patients in the trial across 32 participating centers, 271 patients completed three years in the study and 255 patients provided complete seizure data.

The data showed that the RNS System efficacy improved over time, with 62.5% median seizure reduction at six months after implant (n=314) and an 82.0% median seizure reduction at 36 months after implant (n=255).

Additionally, 42.5% of patients experienced a period of seizure-freedom for at least six months, and 22% of patients were seizure free for at least one year.

In this clinical study, our RNS System was implanted in 324 patients across 32 centers.

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During this ongoing five-year study, 224 SAEs have been reported, 19 of which were attributed to the implant procedure and none of which were attributed as specific to treatment with the RNS System.

These SAEs included nervous system disorders (such as cerebral or intracranial hemorrhage and tinnitus), implant site infections, subdural hematoma, status epilepticus, and implant site dehiscence.

We recently announced our primary effectiveness endpoint data in the Post-approval Study.

Of the 324 patients in the trial across 32 participating centers, 271 patients completed three years in the study and 255 patients provided complete seizure data.

Additionally, 42.5% of patients experienced a period of seizure-freedom for at least six months, and 22% of patients were seizure free for at least one year.

Results will be presented at the American Academy of Neurology Annual Meeting, held April 5 through 9, 2025.

These SAEs included

nervous system disorders (such as cerebral or intracranial hemorrhage and tinnitus), implant site infections, subdural hematoma, status epilepticus, and implant site dehiscence.

Current Label Expansion Studies

RESPONSE Study

We are conducting studies to support label expansion for our RNS System in additional epilepsy populations.

We have IDE approval for an open label study of our RNS System in adolescent patients between ages 12 and 17 who have drug-resistant focal epilepsy from one or two foci.

The objective of this study, referred to as the RESPONSE study, is to demonstrate safety and effectiveness in this pediatric population, and to obtain data on quality of life, neuropsychological function, and social function.

Importantly, our RNS System does not require any modifications to conduct this study.

We began enrollment in RESPONSE in late 2021.

We recently announced our collaboration with the National Evaluation System for health Technology, or NEST, and the FDA to pursue the use of real-world data from the Pediatric Epilepsy Research Consortium, or PERC, to supplement the RESPONSE study.

We are planning to file the expanded label submission to the FDA in the second half of 2025.

NAUTILUS Study

Supported by evidence published in peer-reviewed journals, we also believe that our current RNS System may be able to effectively treat patients with drug-resistant generalized epilepsy.

We are conducting studies to support label expansion for our RNS System in additional epilepsy populations.

Supported by evidence published in peer-reviewed journals, we believe that our current RNS System may be able to effectively treat patients with drug-resistant idiopathic generalized epilepsy.

In February 2021, our RNS System received Breakthrough Device Designation from the FDA for the treatment of IGE.

In the second half of 2021, we received IDE approval to initiate a study in IGE, called the NAUTILUS study, and in March 2024, we completed implanting patients in NAUTILUS, for a total of 87 patients implanted across 23 centers.

In March 2025, the last patient is expected to complete one year of follow up post-implant, with the data lock and subsequent commencement of data analyses expected to begin in the second quarter of 2025.

We plan to use this data to support our expected expanded label submission to the FDA in the second half of 2025 and we anticipate the final patient two-year completion in the first half of 2026.

In March 2025, the last patient in our NAUTILUS study for IGE completed one year of follow up.

In May 2025, we announced the preliminary results from the NAUTILUS study based on analysis of the one-year data.

The study met the 12-week post-implant primary safety endpoint, demonstrating excellent safety outcomes and confirming the favorable safety profile of the RNS System.

While the primary effectiveness endpoint did not reach statistical significance in the overall study, pre-specified secondary endpoints did show meaningful and clinically significant seizure reduction.

In December 2025, we filed a PMA-S to support label expansion for our RNS System in patients who have drug-resistant idiopathic generalized epilepsy.

The PMA-S is supported by positive preliminary results from the NAUTILUS study, which demonstrated robust 77% median GTC seizure reduction and a favorable safety profile in this highly refractory patient population at 18 months of therapy.

Patients in the NAUTILUS trial continue to participate in the study through the completion of two years after the device implant, with prespecified collection of safety and effectiveness data occurring upon completion of the two years post-implant, and we anticipate the final patient two-year completion in the first half of 2026.

RESPONSE Study and NEST Collaboration

We began our efforts to support label expansion of the RNS System in drug-resistant focal epilepsy in patients, ages 12 to 17 (pediatric), with an open-label IDE (‘RESPONSE’) study, which began enrollment in 2021.

In 2025, we began a collaboration with Medical Device Innovation Consortium’s, National Evaluation System for health Technology, or NEST, and the FDA to pursue the use of real-world data to support expanded labeling for pediatric patients.

These efforts are continuing into 2026.

Commercial Strategy

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DIXI Medical Distribution Agreement

In August 2022, we entered into an exclusive distribution agreement, or the Distribution Agreement, with DIXI Medical, pursuant to which we became the exclusive U.S.

distributor of DIXI Medical’s stereo electroencephalography, or Stereo EEG, product line beginning in October 2022.

In 2022, we entered into an exclusive distribution agreement, or the Distribution Agreement, with DIXI Medical USA Corp., or DIXI Medical, pursuant to which we became the exclusive U.S.

distributor of DIXI Medical’s stereo electroencephalography, or Stereo EEG, product line.

These products are used in the epilepsy monitoring units, or EMUs, of Level 4 CECs to determine where epileptic seizures originate.

In addition to providing us with an incremental revenue stream, the DIXI Medical partnership provides us with improved visibility of patients moving through the EMUs, many of whom may be candidates for our RNS System.

This synergistic partnership leverages our field organization that is already calling on the same customers and supports our objective to engage earlier in the diagnostic and therapy selection process.

The Distribution Agreement has an initial term of three years, which expires September 30, 2025.

The Distribution Agreement automatically renews for additional one-year terms, unless either party provides written notice to the other party of its intention to not renew at least 180 days prior to the expiration of the then-current term.

The current Distribution Agreement will automatically renew unless either party provides notice of intent not to renew by April 3, 2025.

In addition to providing us with an incremental revenue stream, the DIXI Medical partnership provided us with improved visibility of patients moving through the EMUs, many of whom may be candidates for our RNS System.

This synergistic partnership leveraged our field organization that was already calling on the same customers and supported our objective to engage earlier in the diagnostic and therapy selection process.

The Distribution Agreement had an initial term of three years, which expired on September 30, 2025.

In March 2025, we notified DIXI Medical of our intent to not renew the Distribution Agreement and the Distribution Agreement by its terms expired on September 30, 2025.

Although the Distribution Agreement originally provided for a six-month wind down period following the September 30, 2025 expiration, the parties agreed to an amendment that ended the wind down period on December 31, 2025.

We exercised our right to sell DIXI product inventory that we held through December 31, 2025, and as provided for in the Distribution Agreement, DIXI Medical is in the process of buying back, at cost, all DIXI product inventory held by us that has at least six months of remaining shelf life.

Rapport Agreement

In November 2023, we entered into a collaboration agreement with Rapport Therapeutics, Inc., or Rapport, a clinical-stage biotechnology company, to leverage our data as well as our RNS System’s unique biomarker monitoring and data analysis capabilities.

The collaboration evaluates biomarker changes in currently implanted RNS System patients that enroll in Rapport’s Phase 2a clinical trial of its product candidate.

Pursuant to this agreement, we provide information to Rapport that will help evaluate the impact of their product candidate on certain biomarkers of patients with focal onset seizures.

In 2023, we entered into a collaboration agreement with Rapport Therapeutics, Inc., or Rapport, a clinical-stage biotechnology company, to leverage our data as well as our RNS System’s unique biomarker monitoring and data analysis capabilities.

The collaboration evaluated biomarker changes in currently implanted RNS System patients that enroll in Rapport’s Phase 2a clinical trial of its product candidate.

Pursuant to this agreement, we provided information to Rapport to help evaluate the impact of their product candidate on certain biomarkers of patients with focal onset seizures.

We have since agreed to extend our collaboration with a subsequent agreement to provide further monitoring and data analysis services as a part of Rapport’s continuing clinical trial.

Research and Development

We focus our research and development efforts on advancing the treatment of patients living with disabling neurological disorders.

These efforts are enhanced by the strong relationships that we have developed with epileptologists and neurosurgeons, as well as other neuroscientists and experts, through our clinical and commercial activities.

These efforts are enhanced by the strong relationships that we have developed with

epileptologists and neurosurgeons, as well as other neuroscientists and experts, through our clinical and commercial activities.

We believe our brain-responsive RNS System is a platform that can drive a better standard of care for patients living with drug-resistant epilepsy and can also offer a more personalized solution and improved outcomes to the large population of patients living with other brain disorders.

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In addition, our clinical organization has expertise as well as extensive experience in clinical trial design and management, data collection, data management, and clinical data analysis.

Our clinical team has conducted three prospective clinical studies on our RNS System and completed enrollment in a fourth, prospective Post-Approval Study, in addition to the ongoing NAUTILUS and RESPONSE studies.

Our clinical team has conducted three prospective clinical studies on our RNS System and nearing completion of a fourth, prospective Post-Approval Study, in addition to the ongoing NAUTILUS and RESPONSE studies.

We believe the strength and strategic vision of our research and development team, combined with our clinical and regulatory expertise, will continue to drive our leadership position in the emerging category of brain-responsive neuromodulation.

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We believe our unique data, as well as our data analysis, machine learning, and AI capabilities, provide a window into the brain and may be useful to other third parties doing work in or treating patients with epilepsy.

In addition to our near-term efforts, we continue to focus on developing our next-generation neurostimulator and developing new features such as streamlined, remote programming capabilities.

We recently announced that in 2025 we plan to release an AI-powered electrographic seizure classifier tool as a part of the PDMS component of the RNS System.

With this tool, we anticipate bringing greater efficiency in physician identification of electrographic seizures in patients.

In addition to our near-term efforts, we continue to focus on developing our next-generation neurostimulator and developing new features such as streamlined, remote programming capabilities and AI-based software tools for PDMS that drive efficiency in programming the RNS System for detection and stimulation.

In the fall of 2025, we submitted the application for the first of such software tools, Seizure ID™, to the FDA for review and approval.

Seizure ID, an AI-powered electrographic seizure classifier tool, is the first of a suite of planned NeuroPace AI™ applications that will become a part of the PDMS component of the RNS System.

We also maintain and will continue to build an intellectual property portfolio covering brain-responsive neuromodulation and AI assessment of brain data.

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Initial implantation of our RNS System takes place in a single hospital inpatient procedure.

Hospitals are generally reimbursed for inpatient procedures based on Medicare Severity Diagnosis Related Group, or MS‐DRG, classifications derived from ICD-10 codes that describe the patient’s diagnoses and procedure(s) performed during the hospital stay.

One single MS‐DRG payment is intended to cover all hospital costs associated with treating an individual during his or her hospital stay, with the exception of clinician charges associated with performing medical procedures, which are reimbursed through CPT codes and payments.

Hospitals are generally reimbursed for inpatient procedures based on Medicare Severity Diagnosis Related Group, or MS‐DRG, classifications derived from the International Classification of Diseases, Tenth Revision, or ICD-10, codes that

describe the patient’s diagnoses and procedure(s) performed during the hospital stay.

While these MS-DRG and CPT codes are generally employed by both private insurers and government payors, the payment rates typically differ substantially, with private insurers generally providing reimbursement at higher rates than Medicare or Medicaid.

Hospitals code for implantation of our RNS System neurostimulator and implantation of the leads using separate ICD-10 procedure codes.

When combined with an ICD-10 diagnosis code for epilepsy, the codes map into MS-DRG 023 for payment to the hospital.

When combined with a primary ICD-10 diagnosis code for epilepsy, the codes map into MS-DRG 023 for payment to the hospital.

In federal fiscal year 2026, which runs from October 2025 through September 2026, we expect the Medicare average payment rate for MS-DRG 023 at our customer accounts to be approximately $58,675.

We believe that most DBS procedures for epilepsy map into MS-DRG 024 and we expect the Medicare average payment rate at these accounts will be approximately $40,655.

We believe that VNS implantation procedures take place in a single outpatient procedure and map to Ambulatory Payment Classification, or APC, 5465.

We believe that VNS implantation procedures take place in a single outpatient procedure and map to New Technology Ambulatory Payment Classification, or New Tech APC, 1580.

We expect the Medicare average payment rate in 2026 will be approximately $45,000.

The neurosurgeons who implant our RNS System may seek reimbursement for their services using a variety of Category I CPT codes, depending on the type of leads implanted.

Effective in 2024, these codes include new CPT code 61889 for implantation of the RNS neurostimulator in addition to CPT codes 61850 or 61860 for cortical leads or CPT codes 61863 and 61864 for depth leads.

These codes include CPT code 61889 for implantation of the RNS neurostimulator in addition to CPT codes 61850 or 61860 for cortical leads or CPT codes 61863 and 61864 for depth leads.

We believe these codes for depth leads are the same CPT codes used for reimbursement of physician services for epilepsy DBS procedures.

Based on 2025 Medicare national average payment rates, we expect that physician reimbursement under appropriate combinations of these codes may be between approximately $2,765 to $2,990 per procedure for our RNS System and approximately $2,645 for epilepsy DBS procedures.

We believe physician services for the VNS implantation procedure are reimbursed under CPT code 64568 which is associated with a 2025 Medicare national average payment rate of approximately $590.

Based on 2026 Non-Qualifying Alternative Payment Model (AMP) Medicare national average payment rates, we expect that physician reimbursement under appropriate combinations of these codes may be between approximately $3,280 to $3,505 per procedure for our RNS System and approximately $2,685 for epilepsy DBS procedures.

We believe physician services for the VNS implantation procedure are reimbursed under CPT code 64568 which is associated with a 2026 Non-Qualifying AMP Medicare national average payment rate of approximately $660.

After implantation of our RNS System, the patient’s ongoing care, including device programming and data review, is typically managed by an epileptologist or other qualified clinician.

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We believe this CPT code for ECoG review is only applicable to our RNS System as it is currently the only commercially available implanted brain neuromodulation system that records, stores, and enables online review of the patient’s ECoG data.

Based on 2025 Medicare national average payment rates, reimbursement under CPT codes 95983 and 95984 is expected to range from $47 to $88, depending on length of programming time.

Based on 2026 Non-Qualifying AMP Medicare national average payment rates in the physician office setting, reimbursement under CPT codes 95983 and 95984 is expected to range from $52 to $97, depending on length of programming time.

Reimbursement under CPT code 95836 is expected to be approximately $107 for ECoG review.

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We believe physicians submit claims for VNS device programming using code 95976 or 95977, depending on the number of device parameters changed.

Based on Medicare national average payment rates, payment under these codes is expected to range from $36 to $48.

Based on Non-Qualifying AMP Medicare national average payment rates, payment under these codes is expected to range from $38 to $51.

Our industry is competitive and has been evolving rapidly with the introduction of new products and technologies as well as the market activities of industry participants.

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Intellectual Property

Our commercial success depends in part on our ability to obtain and maintain intellectual property protection for our RNS System and any future products, to prevent others from infringing, misappropriating, or otherwise violating our intellectual property rights, to defend and enforce our intellectual property rights, and to operate without infringing, misappropriating, or otherwise violating valid and enforceable intellectual property rights of others.

without infringing, misappropriating, or otherwise violating valid and enforceable intellectual property rights of others.

We actively seek to protect intellectual property that we believe is important to our business, which includes patents covering the components of our RNS System and the methods used for optimizing the therapy that our RNS System delivers.

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We take steps to build and maintain the integrity of our brand, for example, with trademarks and service marks, and we seek to protect the confidentiality of trade secrets that may be important to the development of our business.

We rely on a strategy that combines the use of patents, trademarks, trade secrets, know-how, and license agreements, as well as other

intellectual property laws, employment, confidentiality and invention assignment agreements, and contractual protections, to establish and protect our intellectual property rights.

We rely on a strategy that combines the use of patents, trademarks, trade secrets, know-how, and license agreements, as well as other intellectual property laws, employment, confidentiality and invention assignment agreements, and contractual protections, to establish and protect our intellectual property rights.

Patent Portfolio

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As of December 31, 2025, we owned 98 issued U.S.

patents and 16 non-provisional patent applications pending in the U.S.

patents, 9 non-provisional and 3 provisional patent applications pending in the U.S.

Patent and Trademark Office, or the USPTO.

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Our trademark portfolio is designed to protect the brands of our RNS System and any future products.

As of December 31, 2024, we own 26 trademark registrations, four of which are U.S.

As of December 31, 2025, we own 25 trademark registrations, three of which are U.S.

trademark registrations and the rest in various other countries or regions.

We own trademark registrations for “NeuroPace,” the “NeuroPace” logo, and “RNS” in the United States and various other countries, and “WINDOW TO THE BRAIN” in the U.S.

We own trademark registrations for “NeuroPace,” the “NeuroPace” logo, and “RNS” in the United States and various other countries.

Trade Secrets

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We believe our existing facility will be sufficient to meet our current and near-term manufacturing needs.

Our manufacturing and distribution operations are subject to regulatory requirements of the FDA’s Quality System Regulation, or QSR, for medical devices sold in the United States.

The FDA monitors compliance with the QSR through periodic inspections of our facilities and may include our suppliers’ facilities as well.

Our manufacturing and distribution operations are subject to regulatory requirements of the FDA’s Quality Management System Regulation, or QMSR, for medical devices sold in the United States.

The FDA monitors compliance with the QMSR through periodic inspections of our facilities and may include our suppliers’ facilities as well.

We are also subject to applicable state and local regulations relating to the environment, waste management and health and safety matters, including measures relating to the release, use, storage, treatment, transportation, discharge, disposal, sale, labeling, collection, recycling, treatment and remediation of hazardous substances.

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In the event that one of our suppliers fails to maintain acceptable quality requirements, we may have to find and qualify a new supplier and could experience a material adverse effect to our manufacturing operations and result in manufacturing delays.

We believe our quality management system is compliant with FDA Quality Systems Regulations.

We believe our quality management system is compliant with the FDA’s QSRs and the Quality Management System Regulations, or QMSR, which went into effect on February 2, 2026.

We have been an FDA registered medical device establishment since 2014 and California licensed medical device manufacturer since 2004.

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The FDA conducted a PMA pre-approval inspection of our manufacturing facility in Mountain View, California prior to our PMA approval, as well as an establishment inspection in September 2014 which resulted in no 483 observations.

We were accepted into the FDA Voluntary Improvement Program in 2018, and we are in our seventh year of participation in the program.

We were accepted into the FDA Voluntary Improvement Program in 2018, and we are in our eighth year of participation in the program.

The FDA Voluntary Improvement Program is part of the FDA’s Case for Quality Program.

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For companies that participate in this program, the FDA forgoes conducting routine facility inspections and pre-approval inspections in order to allow participants to shift resources to innovation and improvement efforts.

We believe that we are in compliance, in all material respects, with applicable FDA and QSR requirements.

We believe that we are in compliance, in all material respects, with applicable FDA and QMSR requirements.

The materials, components, and sub-assemblies of our RNS System, as well as manufacturing services, are provided by qualified and approved suppliers, most of which are single source suppliers.

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Classification of a device is important because the class to which a device is assigned determines, among other things, the necessity and type of FDA review required prior to marketing the device, making changes to the device, or otherwise using the device.

medical events and malfunctions through the submission of Medical Device Reports, or MDRs, and appropriate, truthful and non-misleading labeling, advertising, and promotional materials.

Class I devices include those with the lowest risk to the patient and are those for which safety and effectiveness can be reasonably assured by adherence to the FDA’s “general controls” for medical devices, which include compliance with the applicable portions of the QMSR, facility registration and product listing, reporting of adverse medical events and malfunctions through the submission of Medical Device Reports, and appropriate, truthful and non-misleading labeling, advertising, and promotional materials.

Some Class I or low risk devices also require premarket clearance by the FDA through the 510(k) premarket notification process described below.

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The FDA may or may not accept the panel’s recommendation.

In addition, the FDA will generally conduct a pre-approval inspection of the applicant or its third-party manufacturers’ or suppliers’ manufacturing facility or facilities to ensure compliance with the QSR.

In addition, the FDA

will generally conduct a pre-approval inspection of the applicant or its third-party manufacturers’ or suppliers’ manufacturing facility or facilities to ensure compliance with the QMSR.

The FDA will approve the new device for commercial distribution if it determines that the data and information in the PMA constitute valid scientific evidence and that there is reasonable assurance that the device is safe and effective for its intended use(s).

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The FDA may also condition PMA approval on some form of post-market surveillance when deemed necessary to protect the public health or to provide additional safety and efficacy data for the device in a larger population or for a longer period of use.

In such cases, the manufacturer might be required to follow certain patient groups for a number of years and to make periodic

reports to the FDA on the clinical status of those patients.

In such cases, the manufacturer might be required to follow certain patient groups for a number of years and to make periodic reports to the FDA on the clinical status of those patients.

Failure to comply with the conditions of approval can result in material adverse enforcement action, including withdrawal of the approval.

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If the FDA agrees that the device is substantially equivalent to a predicate device currently on the market, it will grant 510(k) clearance to commercially market the device.

If the FDA determines that the device is “not substantially equivalent” to a previously cleared device, for example, due to a finding of a lack of a predicate device, that the device has a new intended use or different technological characteristics that raise different questions of safety or effectiveness when the device is compared to the cited predicate device, the device is automatically designated as a Class III device.

of safety or effectiveness when the device is compared to the cited predicate device, the device is automatically designated as a Class III device.

The device sponsor must then fulfill more rigorous PMA requirements, or can request a risk-based classification determination for the device in accordance with the “de novo” process, which is a route to market for novel medical devices that are low to moderate risk and are not substantially equivalent to a predicate device.

If the FDA determines that the information provided in a 510(k) submission is insufficient to demonstrate substantial equivalence to the predicate device, the FDA generally identifies the specific information that needs to be provided so that the FDA may complete its evaluation of substantial equivalence, and such information may be provided within the time allotted by the FDA or in a new 510(k) submission should the original 510(k) submission have been withdrawn.

After a device receives 510(k) marketing clearance, any modification that could significantly affect its safety or effectiveness, or that would constitute a major change or modification in its intended use, will require a new 510(k)

marketing clearance or, depending on the modification, PMA approval.

The determination as to whether or not a modification could significantly affect the device’s safety or effectiveness is initially left to the manufacturer using available FDA guidance.

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Clinical trials are typically required to support a PMA, oftentimes for a de novo request for classification, and are sometimes required to support a 510(k) submission.

As has and continues to be required for our RNS System, all clinical investigations of devices to determine safety and effectiveness must be conducted in accordance with the FDA’s IDE regulations which govern investigational device labeling, prohibit promotion of the investigational device, and specify an array of recordkeeping, reporting and monitoring responsibilities of study sponsors and study investigators.

investigators.

If the device presents a “significant risk,” as defined by the FDA, to human health, the FDA requires the device sponsor to submit an IDE application to the FDA, which must be approved prior to commencing clinical trials.

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If the FDA determines that there are deficiencies or other concerns with an IDE for which it requires modification, the FDA may permit a clinical trial to proceed under a conditional approval.

Acceptance of an IDE application for review does not guarantee that the FDA will approve the IDE and, if it is

approved, the FDA may or may not determine that the data derived from the trials support the safety and effectiveness of the device or warrant the continuation of clinical trials.

Acceptance of an IDE application for review does not guarantee that the FDA will approve the IDE and, if it is approved, the FDA may or may not determine that the data derived from the trials support the safety and effectiveness of the device or warrant the continuation of clinical trials.

An IDE supplement must be submitted to, and approved by, the FDA before a sponsor or investigator may make a change to the investigational plan that may affect its scientific soundness, study plan or the rights, safety or welfare of human subjects.

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• establishment registration and device listing with the FDA;

• QSR requirements, which require manufacturers and contract manufacturers, including third-party manufacturers, to follow stringent design, testing, control, documentation and other quality assurance procedures during all aspects of the design and manufacturing process;

• QMSR requirements, which require manufacturers and contract manufacturers, including third-party manufacturers, to follow stringent design, testing, control, documentation and other quality assurance procedures during all aspects of the design and manufacturing process;

• labeling regulations and FDA prohibitions against the promotion of investigational products, or “off-label” uses of cleared or approved products;

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Advertising and promotion of medical devices, in addition to being regulated by the FDA, are also regulated by the Federal Trade Commission and by state regulatory and enforcement authorities.

Recently, promotional activities for FDA-regulated products have been the subject of enforcement action brought under healthcare reimbursement laws and consumer protection statutes.

Promotional activities for FDA-regulated products have been the subject of enforcement action brought under healthcare reimbursement laws and consumer protection statutes.

In addition, under the federal Lanham Act and similar state laws, competitors and others can initiate litigation relating to advertising claims.

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It is also possible that other federal, state or foreign enforcement authorities might take action if they consider our promotional, technical guidance, or training materials to constitute promotion of an unapproved or uncleared use, which could result in significant fines or penalties under other statutory authorities, such as laws prohibiting false claims for reimbursement.

Manufacturing processes for commercial products are required to comply with the applicable portions of the QSR, which cover the methods and the facilities and controls for the design, manufacture, testing, production, processes, controls, quality assurance, labeling, packaging, distribution, installation and servicing of finished devices intended for human use.

The QSR also requires, among other things, maintenance of a device master file, design history file, device history records, and complaint files.

Manufacturing processes for commercial products are required to comply with the applicable portions of the QMSR, which cover the methods and the facilities and controls for the design, manufacture, testing, production, processes, controls, quality assurance, labeling, packaging, distribution, installation and servicing of finished devices intended for human use.

The QMSR also requires, among other things, maintenance of a device master file, design history file, device history records, and complaint files.

As a manufacturer, we are subject to periodic scheduled or unscheduled inspections by the FDA.

Failure to maintain compliance with the QSR requirements could result in the shut-down of, or restrictions on, manufacturing operations and the recall or seizure of products, which would harm our business.

Failure to maintain compliance with the QMSR requirements could result in the shut-down of, or restrictions on, manufacturing operations and the recall or seizure of products, which would harm our business.

The discovery of previously unknown problems with our product, including unanticipated adverse events or adverse events of increasing severity or frequency, whether resulting from the use of the device within the scope of its clearance or off-label by a clinician in the practice of medicine, could result in restrictions on the device, including the removal of the product from the market or voluntary or mandatory device recalls.

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For example, in the United States, there are federal and state anti-kickback laws that prohibit the payment or receipt of kickbacks, bribes or other remuneration intended to induce the purchase or recommendation of healthcare products and services or reward past purchases or recommendations.

Violations of these laws can lead to significant civil and criminal penalties, including fines, disgorgement, imprisonment and exclusion from participation in federal healthcare programs, integrity oversight and reporting obligations, contractual damages, reputational harm, diminished profits and future earnings and the forced curtailment or restructuring of our operations.

Violations of these laws can lead to significant administrative, civil and criminal penalties, including fines, disgorgement, imprisonment, exclusion from participation in federal healthcare programs, integrity oversight and reporting obligations, contractual damages, reputational harm, diminished profits and future earnings and the forced curtailment or restructuring of our operations.

These laws are applicable to us as a medical device company and also apply to hospitals, epileptologists, neurologists, neurosurgeons, and other potential purchasers or users of our RNS System or any future products.

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The federal Anti- Kickback Statute and implementing regulations provide for certain narrow exceptions and “safe harbors” for certain defined practices including discounting, rebating or personal services arrangements, among other things.

Failure to meet all the requirements of a particular applicable statutory exception or regulatory safe harbor does not make the conduct per se illegal under the Anti Kickback Statute.

Instead, the legality of the arrangement will be evaluated on a case-by-case basis based on a cumulative review of all its facts and circumstances.

In addition, a person or entity does not need to have actual knowledge of this statute or specific intent to violate it in order to have committed a violation.

In addition, the government may assert that a claim, including items or services resulting from a violation of federal Anti- Kickback Statute, constitutes a false or fraudulent claim for purposes of the civil False Claims Act or the civil monetary penalties statute, which imposes fines against any person who is determined to have presented or caused to be presented claims to a federal healthcare program that the person knows or should know is for an item or service that was not provided as claimed or is false or fraudulent.

be presented claims to a federal healthcare program that the person knows or should know is for an item or service that was not provided as claimed or is false or fraudulent.

Moreover, the lack of uniform court interpretation of the Anti-Kickback Statute makes compliance with the law difficult.

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Violations of the federal Anti-Kickback Statute may also result in civil and criminal penalties, including criminal fines and imprisonment, or exclusion from Medicare, Medicaid or other governmental programs.

Certain arrangements between medical device companies and referring, or prescribing clinicians have been identified in fraud alerts issued by the OIG as implicating the Anti-Kickback Statute.

Certain arrangements between medical device companies and referring, or prescribing clinicians have been identified in fraud alerts issued by the Office of Inspector General, or OIG, as implicating the Anti-Kickback Statute.

Moreover, the provision of payments or other items of value by a medical device company to a referral source could be prohibited under the Stark Law (described below) unless the arrangement meets all criteria of an applicable exception.

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§ 1347), also created additional federal criminal statutes that prohibit, among other actions, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, including payors, knowingly and willfully embezzling or stealing from a healthcare benefit program, willfully obstructing a criminal investigation of a healthcare offense, and knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services.

Similar to the federal Anti-

Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation.

Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation.

Federal criminal law at 18 U.S.C.

§ 1001, among other sections, prohibits knowingly and willfully falsifying, concealing, or covering up a material fact or making any materially false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services.

The civil False Claims Act imposes liability on any person or entity who, among other things, knowingly presents, or causes to be presented, a false or fraudulent claim for payment by a federal healthcare program.

The qui tam provisions of the False Claims Act allow a private individual to bring civil actions on behalf of the federal government alleging that the defendant has submitted or caused the submission of a false claim to the federal government, and to share in any monetary recovery.

The civil FCA imposes liability on any person or entity who, among other things, knowingly presents, or causes to be presented, a false or fraudulent claim for payment by a federal healthcare program.

The qui tam provisions of the FCA allow a private individual to bring civil actions on behalf of the federal government alleging that the defendant has submitted or caused the submission of a false claim to the federal government, and to share in any monetary recovery.

These laws can apply to entities that provide information on coverage, coding, and reimbursement of their products and assistance with obtaining reimbursement to persons who bill payors.

When an entity is determined to have violated the federal civil False Claims Act, the government may impose civil fines, award treble damages, and exclude the entity from participation in Medicare, Medicaid and other federal healthcare programs.

In addition, various states have enacted false claim laws analogous to the federal False Claims Act.

When an entity is determined to have violated the federal civil FCA, the government may impose civil fines, award treble damages, and exclude the entity from participation in Medicare, Medicaid and other federal healthcare programs.

In addition, various states have enacted false claim laws analogous to the federal FCA.

The Civil Monetary Penalty Act of 1981 imposes penalties against any person or entity that, among other things, is determined to have presented or caused to be presented a claim to a federal healthcare program that the person knows or should know is for an item or service that was not provided as claimed or is false or fraudulent, or offering or transferring remuneration to a federal healthcare beneficiary that a person knows or should know is likely to influence the beneficiary’s decision to order or receive items or services reimbursable by the government from a particular provider or supplier.

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Failure to submit required information may result in civil monetary penalties, which can be increased for “knowing failures”, for all payments, transfers of value or ownership or investment interests that are not timely, accurately, and completely reported in an annual submission, and may result in liability under other federal laws or regulations.

Numerous states have enacted laws prohibiting business corporations, such as us, from practicing medicine and other professions and employing or engaging physicians and other professionals to practice medicine, generally

referred to as the prohibition against the corporate practice of medicine.

These laws are designed to prevent interference in the medical decision-making process by anyone who is not a licensed professional.

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Any violations of these laws, or allegations of such violations, could involve significant costs and expenses, including legal fees, and could result in a material adverse effect on our business operations and revenue.

Centers for Medicare and Medicaid Services

Centers for Medicare & Medicaid Services

Medicare is a federal program administered by CMS through fiscal intermediaries, Medicare Administrative Contractors and carriers.

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The methodology for determining coverage status and the amount of Medicare reimbursement varies based upon, among other factors, the setting in which a Medicare beneficiary received healthcare products and services.

Any changes in federal legislation, regulations and policy affecting CMS coverage and reimbursement relative to the procedures of implanting or using our RNS System could have a material effect on our performance.

Any changes in federal legislation, regulations and policy affecting CMS

coverage and reimbursement relative to the procedures of implanting or using our RNS System could have a material effect on our performance.

CMS also administers the Medicaid program, a cooperative federal/state program that provides medical assistance benefits to qualifying low income and medically needy persons.

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Changes in healthcare policy could increase our costs and subject us to additional regulatory requirements that may interrupt commercialization of our RNS System and future products.

Changes in healthcare policy could increase our costs, decrease our revenue and impact sales of and reimbursement for our RNS System and future

Changes in healthcare policy could increase our costs, decrease our revenue and impact sales of and reimbursement for our RNS System and future products.

The Affordable Care Act substantially changes the way healthcare is financed by both governmental and private insurers, and significantly impacts our industry.

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The implementation of the Affordable Care Act in the United States, for example, has changed healthcare financing and delivery by both governmental and private insurers substantially, and affected medical device manufacturers significantly.

The Affordable Care Act imposed, among other things, a 2.3% federal excise tax, with limited exceptions, on any entity that manufactures or imports Class I, II and III medical devices offered for sale in the United States that began on January 1, 2013.

Through a series of legislative amendments, the tax was suspended for 2016 through 2019.

The Further Consolidated Appropriations Act, signed into law on December 20, 2019, has repealed the medical device excise tax and as a result of the repeal and the prior moratorium, sales of taxable medical devices after December 31, 2015, are not subject to the tax.

The Affordable Care Act also provided incentives to programs that increase the federal government’s comparative effectiveness research, and it implemented payment system reforms including a national pilot program on payment bundling to encourage hospitals, physicians and other providers to improve the coordination, quality and efficiency of certain healthcare services through bundled payment models.

Additionally, the Affordable Care Act has expanded eligibility criteria for Medicaid programs and created a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research.

We continue to evaluate the full impact that the Affordable Care Act will have on our business.

During its history, there have been amendments to and judicial, executive and Congressional challenges to certain aspects of the Affordable Care Act.

For example, on August 16, 2022, the Inflation Reduction Act of 2022, or IRA, was signed into law, which among other things, extends enhanced subsidies for individuals purchasing health insurance coverage in Affordable Care Act marketplaces through plan year 2025.

The IRA also eliminates the “donut hole” under the Medicare Part D program beginning in 2025 by significantly lowering the beneficiary maximum out-of-pocket cost and creating a new manufacturer discount program.

For example, on July 4, 2025, the One, Big, Beautiful Bill Act, or OBBBA, was signed into law, which narrowed access to Affordable Care Act marketplace exchange enrollment and declined to extend the Affordable Care Act enhanced advanced premium tax credits that expired at the end of 2025, which, among other provisions in the law, are anticipated to reduce the number of Americans with health insurance.

The OBBBA also is expected to reduce Medicaid spending and enrollment by implementing work requirements for some beneficiaries, capping state-directed payments, reducing federal funding, and limiting provider taxes used to fund the program.

Congress is considering proposed legislation intended to further reduce healthcare costs with alternatives to replace the expired Affordable Care Act subsidies.

It is possible that the Affordable Care Act will be subject to judicial or Congressional challenges in the future.

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For example, the Budget Control Act of 2011, among other things, included reductions to CMS payments to providers of 2% per fiscal year, which went into effect on April 1, 2013 and, due to subsequent legislative amendments to the statute, will remain in effect through 2032 unless additional Congressional action is taken.

The American Rescue Plan Act of 2021 was signed into law on March 11, 2021, expanding the definition of covered employees as defined under IRC Section 162(m).

The provisions under the expanded definition of covered employees have been considered and were determined not to be materially impactful on our tax positions.

In addition, the current administration is pursuing policies to reduce regulations and expenditures across government agencies including at the U.S.

Department of Health and Human Services, the FDA, CMS and related

These actions, presently directed by executive orders or memoranda from the Office of Management and Budget, may propose policy changes that create additional uncertainty for our business.

Recent actions, for example, include directing agencies to reduce agency workforce and cut programs and imposing tariffs on imported products.

Additionally, the current administration recently called on Congress to enact “The Great Healthcare Plan,” to codify and expand Most-Favored Nation pricing, lower government subsidies to private insurance companies, increase healthcare price transparency, and enact restrictions on pharmacy benefit manager payment methodologies, among other things.

These actions and policies may significantly reduce U.S.

medical device prices, potentially impacting manufacturers’ global pricing strategies and profitability, while increasing their operational costs and compliance risks.

We believe that there will continue to be proposals by legislators at both the federal and state levels, regulators and third-party payors to reduce costs while expanding individual healthcare benefits.

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In addition, as noted above, we are planning for regulatory clearances in non-U.S.

jurisdictions, including the EU, Canada, and Japan, and may be subject to non-U.S.

data privacy and security laws, rules, regulations and standards as our operations expand.

For example, the collection, use, disclosure, transfer, or other processing of personal information regarding individuals in the EU, including personal health data, is subject to the European Union General Data Protection Regulation (EU) 2016/679, or EU GDPR.

jurisdictions, including the European Union (EU), Canada, and Japan, and may be subject to non-U.S.

data privacy and security laws, rules,

regulations and standards as our operations expand.

For more information regarding the risks related to data privacy and security, please see “Risk Factors—Risks related to privacy, information technology and cybersecurity.”

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For example, we utilize both instructor-led training and online learning to deliver proprietary, targeted training courses designed to position our commercial organization at the cutting edge of neuromodulation.

For our talent pipeline development, we utilize a variety of tools and work closely with individual business functions to provide training and hands-on support for managers and leaders for assessing talent, identifying development opportunities, and discussing succession planning.

For our talent pipeline development, we utilize a variety of tools and work closely with individual business functions to

provide training and hands-on support for managers and leaders for assessing talent, identifying development opportunities, and discussing succession planning.

Communication is also key to our employee development and retention.

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We offer a comprehensive benefits package including:

401(k) plan, medical, dental, and vision insurance, life and long-term disability insurance, health care and childcare spending accounts, Section 529 college savings plan, three weeks paid vacation for most employees at start, 12 paid holidays, and PTO for sick time and family

Other benefits include hybrid work schedules, online wellness program, patent awards, company picnics, parties and barbecues, and more.

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

What changed 10-K

Item 1. Business