NASDAQ: ELUT

Our lead development programs comprise NXT-41, a next-generation biologic matrix, and NXT-41x, which builds on the NXT-41 matrix by incorporating local antibiotic drug delivery. NXT-41 is an advanced biomatrix designed to provide consistent handling and incorporation while enabling scalable manufacturing. In NXT-41x, antibiotics are incorporated into the matrix and released locally over extended periods, offering broad-spectrum antimicrobial protection

against common causes of post-surgical infection. See “Research and Development” below for a more detailed description of these anticipated future products in our reconstructive surgery portfolio.

Elutia continues to market and sell its proprietary biologic matrix products, including SimpliDerm, a human acellular dermal matrix (“hADM”) used in soft tissue reconstruction, and its cardiovascular repair portfolio, comprising ProxiCor, VasCure, and Tyke. SimpliDerm is the primary commercial product in our Women’s Health segment, and the cardiovascular products reside in our Cardiovascular segment. These products establish our commercial presence in surgical repair and reconstruction and provide a revenue base that supports development of our next-generation innovation. These products are sold directly to healthcare facilities through independent sales agents.

In 2025, we leased approximately 26,598 square feet of production, laboratory, and administrative space in Gaithersburg, Maryland, which now serves as our headquarters and primary operations site. This facility supports administrative functions as well as the development of NXT-41 and NXT-41x and, subject to obtaining the necessary FDA marketing authorizations, is expected to support the commercial production of these products. We also maintain a corporate office in San Diego, California. Our former Roswell, Georgia facility was acquired by Boston Scientific Corporation in connection with the sale of the CIED business in October 2025. As part of the sale of our Orthobiologics Business to Berkeley Biologics, LLC (“Berkeley”) in November 2023, our former Richmond, California facility was transferred to Berkeley, and we no longer operate that facility.

Discontinued Operations - Sale of CIED Businesses

On September 8, 2025, we executed an Asset Purchase Agreement (the “APA”) with BSC and CPI (collectively the “CIED Buyers”). On October 1, 2025, at the closing of the transactions contemplated by the APA, the CIED Buyers purchased from Elutia substantially all of the assets that are related to our business of researching, developing, administering, operating, commercializing, manufacturing, selling and marketing our CIED products, including the CanGaroo®, CanGaroo® RM, EluPro™ and CIED envelope products, including next generation CIED envelope products (collectively the “CIED Business”). The APA provides for an aggregate purchase price, subject to certain adjustments pursuant to the terms of the APA, of up to $88.0 million in cash, with $80.4 million (which included an inventory adjustment of $0.4 million) that was paid in cash to Elutia at closing of the transactions and $8.0 million that was deposited at the closing of the transactions in escrow for a period of twelve months, which is subject to potential reduction in the event of certain post-closing breaches of representations and warranties within the APA by Elutia. The assets of the CIED Business constituted substantially all of the assets previously held in Elutia’s Device Protection segment. The CIED Buyers only assumed certain liabilities related to performance of the contracts transferred in the APA. We recognized a gain, net of tax effect and divestiture costs, of $76.1 million on the sale of the CIED Business in 2025.

Prior to the divestiture, we marketed EluPro and CanGaroo in the United States through our direct sales force, supported by a commercial partner, BSC. As part of the divestiture, the sales organization supporting the CIED business transferred to the CIED Buyers.

Discontinued Operations - Sale of Orthobiologics Business

On November 8, 2023, we completed the sale of substantially all of the assets relating to our former Orthobiologics Business to Berkeley. The assets sold represented the entirety of our Orthobiologics segment. We received approximately $14.6 million, and we may earn up to an additional $20.0 million, in the aggregate, in the form of earn-out payments. 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 have been no earn-out payments made to date. In the purchase agreement, we have retained the liabilities arising out of the VBM and FiberCel recall matters, as described in Note 17 to the consolidated financial statements, both of which products were part of the Orthobiologics Business. We recognized a gain of $6.0 million on the sale of the Orthobiologics Business in 2023 and an additional gain of $0.2 million in 2024 from an adjustment payment related to the final working capital received by Berkeley at the sale date. Additionally, the purchase agreement provided for a customary indemnity holdback in the amount of $1.5 million to be retained by Berkeley for 24 months after closing of the transaction. The indemnity holdback was available as a source of recovery for Berkeley for claims of indemnification under the purchase agreement, and some or

all of the holdback could be retained by Berkeley if Berkeley was successful in asserting a claim or claims for indemnification against us. In March 2026, the indemnity holdback was resolved with Berkeley remitting $0.4 million to Elutia. Such amount will be recognized as additional gain in the first quarter of 2026. Should we receive incremental proceeds in the future through an earn-out payment, an additional gain will be recorded upon the receipt of such amounts.

Our Competitive Strengths

Our mission is to humanize medicine so patients can thrive without compromise. We intend to establish our DEB products as the standard of care in reconstructive procedures, including surgeries involving implanted devices. We believe our key competitive strengths position us well to execute on our growth strategy. Our key competitive strengths are:

Focus on Unmet Medical Need. Reconstructive surgeries, including implant-based procedures, are widely performed and play a critical role in restoring function and quality of life for patients. Despite advances in surgical techniques and the widespread use of biologic matrices and other adjunctive materials, clinically significant complication rates persist. Surgical site infection rates in certain settings reach approximately 15 to 20 percent. These serious complications can result in rehospitalizations, procedure failure, prolonged recovery, and increased healthcare utilization. In addition to infection, inflammatory responses, fibrosis, and foreign body reactions can adversely affect surgical outcomes and long-term implant performance. We believe the complication rates reflect an ongoing unmet medical need for solutions that more effectively address the causes of surgical failure. This unmet need drives continued demand for improved products that can help to improve clinical outcomes.

Pioneering Technology. We are developing and commercializing products in our DEB platform that integrates biologic matrices with localized drug delivery. The goal of this approach is to address persistent, unresolved challenges associated with implant-based and reconstructive procedures, such as infection and inflammation, while preserving the regenerative benefits of biologic matrices. We believe that combining these capabilities requires specialized expertise in regenerative materials, drug incorporation, manufacturing and regulatory development.

Our platform builds on the established markets of biologic matrix for tissue repair and soft tissue reconstruction, with the addition of localized delivery of therapeutic agents intended to address key underlying factors that lead to surgical complications. By delivering drugs directly at the surgical site, this approach is designed to achieve localized therapeutic activity while limiting systemic exposure. We are also designing these products to support extended release, extending the period during which the surgical site may be protected. We believe this integrated platform can be adapted across multiple surgical applications where biologic matrices are widely used, and where there remains a need to improve clinical outcomes.

The development and commercialization of EluPro validated the technical feasibility of this approach. EluPro was an antibiotic-eluting biologic matrix envelope designed to secure CIEDs and provide local antibiotic delivery at the implant site. It was the first product of this type developed for use with CIEDs and demonstrated the commercial potential of combining a biologic matrix with localized drug delivery. We believe this experience supports the broader applicability of our DEB platform across reconstructive and soft tissue repair markets.

Proven Commercialization. Our first commercial DEB offering, EluPro, was fully launched in January 2025 and upon sale to BSC in October 2025, sales of EluPro and CanGaroo had achieved annualized revenues of approximately $19 million, with EluPro comprising approximately $14 million of the total. We believe that this rapid sales growth rate demonstrates our ability to successfully and meaningfully commercialize our pioneering DEB product offerings.

Well-positioned in Large, Attractive and Growing Markets. We believe that the plastic and reconstructive surgery markets, the markets targeted by our next-generation antibiotic-eluting biomatrix products, NXT-41 and NXT-41x, currently represent a combined market opportunity of approximately $1.5 billion in the United States. We believe these markets are characterized by procedures with relatively high per-procedure economic value, which supports the adoption of differentiated technologies that address meaningful clinical complications. We also believe that the overall markets to which our DEB products can be applied will continue to experience significant growth given (i) advancements in implantable medical device technologies and surgical techniques, (ii) shifting demographics that include an aging population with a greater incidence of comorbidities, and (iii) increasing procedure volumes.

Integrated Operating Model. Our operating model is designed to support integrated execution across research and development (“R&D”), manufacturing and commercialization, enabling close coordination among these functions and the incorporation of clinical and market feedback into product design and development. As we advance our DEB platform and pipeline programs, we intend to maintain control over manufacturing to support product quality, manage cost of goods, and scale production as needed. We believe this integrated approach supports disciplined development, operational flexibility, and efficient scaling.

Executive Management Team with Extensive Industry Experience Our executive management team has extensive experience in the regenerative medicine and medical device industries, spanning R&D, operations, manufacturing and commercial. This experience allows us to operate with a deep understanding of the underlying trends in this industry and the intertwined scientific, clinical, regulatory, commercial and manufacturing functions that drive success. This breadth of experience supports execution of our platform strategy.

Our Growth Strategy

Our growth strategy is focused on advancing our DEB platform and pipeline programs to address unmet needs in reconstructive surgery, while maintaining a disciplined operating approach following recent divestitures.

Advance our Pipeline of Innovative Drug-Eluting Biologic Products. We are pioneering DEBs to help solve problems unaddressed by available options. We intend to leverage our DEB platform technology, and our demonstrated success related to these products, by developing and commercializing products for markets with similar unmet needs, including breast reconstruction. We intend to prioritize investment in the development of our DEB platform and pipeline programs. These programs build on our experience integrating biologic matrices with localized drug delivery and are designed to address persistent surgical complications, such as infection and inflammation, in reconstructive procedures. We plan to advance these programs through continued research and development, preclinical evaluation, regulatory engagement, and clinical evaluation.

Focus on Surgical Applications with Significant Unmet Need. We are focusing our development efforts on surgical applications characterized by high complication rates and significant procedural complexity. We believe these factors create opportunities for differentiated solutions that can improve clinical outcomes while fitting within existing surgical workflows. Our initial focus is on implant-based reconstructive surgeries and soft tissue repair applications, with the potential to expand into additional indications where our DEB platform may be applicable.

Maintain and Expand our Commercial Foundation. We plan to continue to operate our existing commercial product portfolio and sales infrastructure to support ongoing operations and maintain market presence. These commercial activities, which we anticipate growing significantly upon, and subject to, FDA clearances of NXT-41 and NXT-41x, also provide insight into surgeon needs, purchasing trends, and clinical practice patterns, which we believe can inform development priorities for our pipeline programs. Over time, we may continue to assess the role of these products as we advance our proprietary platform technologies.

Our Proprietary Products

Our portfolio includes a combination of commercial biologic matrix products and development-stage drug-eluting biomatrix programs. Our commercial products address established markets in surgical repair and reconstruction and provide a revenue base that supports ongoing operations and research and development. Our development efforts are focused on advancing our drug-eluting biomatrix platform to address unmet needs in reconstructive surgery.

Women’s Health Market

Market Opportunity

Biologic matrices are widely used in reconstructive surgery to provide soft tissue support, reinforcement, and coverage in a range of clinical settings. These procedures are performed to restore form and function following trauma,

tumor resection, congenital abnormalities, infection, or disease, and include applications involving the breast, chest wall, and other soft tissue defects. The use of acellular dermal matrices (“ADMs”) in plastic and reconstructive surgery is well established in clinical practice and supported by published literature and consensus guidelines for certain surgical techniques.

Breast reconstruction following mastectomy represents a common application of biologic matrices within plastic and reconstructive surgery. It is estimated that, in the United States, approximately one in eight women will develop invasive breast cancer during their lifetime, which results in approximately 163,000 post-mastectomy breast reconstruction procedures. In these procedures, ADMs are frequently used in implant-based reconstruction to assist with implant positioning, provide soft tissue support, and facilitate tissue integration. Despite widespread adoption of biologic matrices in this and other reconstructive applications, clinically meaningful complication rates persist, with reported serious infection rates in certain settings reaching approximately 15 to 20 percent, along with delayed healing and implant-related complications. As of February 2026, no biologic matrix or other soft tissue reinforcement material has been indicated specifically for use in breast reconstruction surgery by the U.S. Food and Drug Administration.

SimpliDerm

SimpliDerm is an hADM marketed for use in soft tissue repair, reinforcement, and reconstruction. It is manufactured using a proprietary decellularization process designed to preserve the structural integrity of the extracellular matrix while reducing immunogenic components. SimpliDerm is provided in a pre-hydrated form and terminally sterilized.

We sell SimpliDerm through a network of independent sales agents to plastic and reconstructive surgeons in the United States. From March 2023 through October 2025, SimpliDerm was also distributed under a non-exclusive agreement with Sientra and its successor, Tiger Aesthetics Medical (“Tiger”), which was terminated in October 2025.

SimpliDerm is part of our current commercial product portfolio and supports our commercial presence in plastic and reconstructive surgery. It provides operational and market insight relevant to the advancement of our drug-eluting biomatrix development programs and strengthens our commercial channel with reconstructive and plastic surgeons, who routinely use biologic matrices in surgical reconstruction. Our NXT-41x development program is initially intended for use in reconstructive applications, and SimpliDerm supports the development of surgeon relationships, experience, and organizational capabilities relevant to the potential introduction of our next-generation biologic drug-eluting technologies.

Cardiovascular Market

Cardiovascular Products

We sell cardiovascular products derived from a biologic matrix based on porcine small intestinal submucosa extracellular matrix (“SIS-ECM”), all of which received 510(k) regulatory clearance as medical devices:

● ProxiCor for Cardiac Tissue Repair is cleared for use as an intracardiac patch for repairs such as atrial and ventricular septal defects and suture-line buttressing, as well as for pledgets.

● ProxiCor for Pericardial Closure is used to reconstruct the pericardium after heart surgery.

● Tyke is a thinner, more pliable matrix cleared for use in neonates and infants for the repair of pericardial structures; as an epicardial covering for damaged or repaired cardiac structures, and as a patch material for cardiac defects.

● VasCure is cleared for use, and is used by cardiovascular, vascular and general surgeons as, a patch material to repair or reconstruct the peripheral vasculature, including the carotid, femoral and tibial blood vessels, by modeling into site-specific tissue and conforming to repair defects.

Commercial Approach

From May 2017 through March 2023, these products were sold directly to hospitals and other healthcare facilities through our sales force and independent sales agents. In April 2023, we entered into an exclusive distribution agreement with LeMaitre Vascular for these products in the United States. This agreement with LeMaitre Vascular was terminated in April 2025, at which time we resumed selling these products directly to hospitals and other healthcare facilities through independent sales agents.

Competition

We operate in highly competitive markets that are subject to rapid technological change. Success in these markets depends on product efficacy, ease of product use, product price, availability of payor coverage and adequate third-party reimbursement, customer support services for technical, clinical and reimbursement support and customer preference for, and loyalty to, the products.

We believe that the demonstrated clinical efficacy of our products, the breadth of our product portfolio, our in-house customer support services, our customer relationships and our reputation offer us advantages over our competitors.

Our products compete primarily with other cardiovascular repair and human-derived acellular dermis products. ProxiCor, Tyke and VasCure compete with bovine pericardium and synthetic patch materials produced by numerous companies, including Gore’s Gore-tex and Terumo’s Vascutek. SimpliDerm competes primarily against human-derived acellular dermis matrix meshes, including AbbVie’s AlloDerm, MTF’s FlexHD, Stryker’s DermACELL and Evergen’s (formerly RTI Surgical) Cortiva. SimpliDerm also competes against animal-derived biological mesh products, such as AbbVie’s Strattice and Integra’s SurgiMend, as well as various synthetic mesh products.

We also compete in the marketplace to recruit and retain qualified scientific, management and sales personnel, as well as to acquire technologies and technology licenses complementary to our products or advantageous to our business.

Our competitors’ products in the soft tissue repair market have been available for use for multiple years. During this time, private payors have developed policies for coverage based on available data and literature. While there are certain national and regional third-party payors who provide specific reimbursement for SimpliDerm or procedures using SimpliDerm, the majority do not.

We are aware of several companies that are developing technologies in our current and future product areas. As a result, we expect competition to remain intense. Our ability to compete successfully will depend primarily on our ability to develop proprietary products that reach the market in a timely manner, are used in procedures that receive adequate payor coverage and reimbursement, are cost-effective, and are safe and effective, as well as our reputation in the market and success of our sales strategy. See Part I, Item 1A. “Risk Factors - Risks Related to Our Business - We face significant and continuing competition from other companies, some of which have longer operating histories, more established products and/or greater resources than we do, which could adversely affect our business, financial condition and results of operations.”

Sales and Marketing

Both SimpliDerm and our Cardiovascular products are sold through independent sales agents. In March 2023, we entered into a non-exclusive distribution agreement for SimpliDerm with Sientra. In April 2024, Tiger assumed this agreement in connection with its acquisition of Sientra, and the agreement remained in effect until October 2025, at which point, it was terminated by Elutia. In April 2023, we entered into an exclusive distribution agreement with LeMaitre Vascular for our Cardiovascular products, which was subsequently terminated in April 2025. Following these contract terminations, our products resumed being marketed through our network of independent distributors.

We have historically focused our market development and commercial activities primarily in the United States. All of our sales in 2025, and greater than 96% of our net sales in 2024, were generated in the United States. Sales of our

products outside of the United States ceased after May 2024 due to changes in certain international regulations which required investment by us not warranted by the then-current level of sales in these markets.

Manufacturing and Suppliers

SimpliDerm was historically processed at our former Richmond, California facility, which was included in the divestiture of the Orthobiologics Business in 2023. SimpliDerm is now supplied to Elutia through a supply agreement with Berkeley, the acquiror of our Orthobiologics Business. The porcine SIS-ECM for our Cardiovascular products is supplied by Cook Biotech Incorporated (“Cook”), now owned by Evergen, through a long-term supply agreement. Both Berkeley and Cook are currently our sole sources of supply within the respective product offerings, and we cannot guarantee that an interruption in supply will not occur.

We historically performed the minor finished goods conversion activities along with the stocking and distribution of our Cardiovascular products at our former manufacturing facility in Roswell, Georgia. Our Roswell facility was acquired by BSC in connection with the sale of the CIED Business, and these logistics, along with order fulfillment of SimpliDerm, are now provided to us through a third-party logistics provider.

In March 2025, we signed a lease for 26,598 square feet of production, laboratory and administrative space in Gaithersburg, Maryland, which serves as our headquarters and primary operational site. We are currently using this space for administrative purposes and development of NXT-41 and NXT-41x. We anticipate utilizing this facility for the commercial production of these products, to the extent FDA marketing authorization is obtained.

Research and Development

Our research and development team has extensive experience in developing regenerative medicine and DEB products and works to design products that are intended to improve patient outcomes, simplify techniques, shorten procedures, reduce rehospitalizations, and as a result, reduce costs. We have recruited and retained staff with significant experience and skills, gained through both industry experience and academic training. In addition to our internal staff, our external network of development and testing laboratories and physicians aids us in our research and development process.

We are now focused on advancing our proprietary DEB platform for use in surgical reconstruction and related applications. This platform combines our expertise in biologics and localized drug delivery to address complications that lead to poor outcomes in reconstructive procedures. Our first commercial product under this platform, EluPro, which along with CanGaroo was sold to BSC in October 2025 for an aggregate purchase price of up to $88 million, demonstrated the clinical potential of combining a biologic scaffold with antibiotic drug delivery to reduce device-related complications. We believe the same foundational technology can be applied to broader reconstructive and soft tissue repair markets where biologic matrix products are widely used but where outcomes remain suboptimal due to causes of failure, such as infection, inflammation, and fibrosis.

The clinical and economic need in these markets is substantial, reflecting both the volume of reconstructive surgery and the persistence of high complication rates. For example, in implant-based breast reconstruction and complex abdominal wall repair, infection rates approximate 15 to 20 percent, leading to frequent reoperations and hospital readmissions. Each year, in the United States, there are approximately 163,000 post-mastectomy breast reconstruction procedures, and roughly one in three experiences a serious complication such as infection, capsular contracture, or implant loss. We believe biologic matrices represent an estimated $1.5 billion U.S. market opportunity and account for more than 60% of reconstruction spending, yet meaningful innovation has been limited and significant unmet medical need remains.

Our lead development programs, NXT-41 and NXT-41x, are designed as next-generation biologic scaffolds combined with local antibiotic delivery. NXT-41 features a porcine-derived engineered matrix that provides superior handling, consistency, and incorporation compared to human-derived acellular dermal matrices. In NXT-41x, the antibiotics rifampin and minocycline are incorporated into the matrix, and the drugs are released locally over extended periods, offering broad-spectrum antimicrobial protection against the pathogens most associated with implant infections,

mitigating the risk of any systemic toxicity. The objective is to materially reduce complications arising from contamination, biofilm formation, and inflammation while maintaining surgeon-preferred handling, flexibility, and soft-tissue reinforcement for implant support. We believe Elutia is well-positioned to pioneer a new class of active biomatrices for reconstructive biosurgery, combining biologic innovation and localized pharmacologic activity to improve outcomes for patients at favorable economics for healthcare systems. We expect FDA clearance of NXT-41 in the second half of 2026 and anticipate FDA clearance for NXT-41x by mid-2027.

Intellectual Property

We rely on a combination of patents, license agreements, trademarks, confidentiality agreements and security procedures to protect our proprietary products, preservation technology, trade secrets and know-how. We believe that our patents, trade secrets, trademarks and technology licensing rights provide us with important competitive advantages. Our intellectual property strategy is focused on supporting the development of our proprietary DEB platform and related technologies, while maintaining flexibility as our pipeline advances.

Our owned intellectual property includes patents and patent applications relating primarily to aspects of biologic matrix processing and related technologies, including technologies outside of our current commercial product portfolio. We do not rely on patent protection for all aspects of our current commercial products, and certain products are protected primarily through manufacturing know-how, trade secrets, and regulatory barriers to entry.

In connection with the development and commercialization of EluPro, we created a substantial intellectual property portfolio specifically relating to antibiotic-eluting biologic envelopes. That intellectual property portfolio was transferred to the CIED Buyers as part of the sale of our CIED business in October 2025 and contributed to the overall value of that transaction. The transferred intellectual property did not include patents or patent applications relating to our NXT-41 or NXT-41x development programs or to our broader drug-eluting biomatrix platform. As of December 31, 2025, our intellectual property portfolio relating to our next-generation biologic matrix technologies, including NXT-41 and NXT-41x, consists of patent filings directed to aspects of matrix design, drug incorporation, and related manufacturing methods. In addition, we own one U.S. patent that relates to our technology for SimpliDerm that claims a method of preparing an acellular dermal matrix that is anticipated to expire in 2033. There can be no assurance that any pending patent applications will ultimately be issued as patents.

As with other medical device and regenerative medicine companies, our ability to maintain and solidify our proprietary and intellectual property position for our product candidates will depend on our success in obtaining effective patent claims and maintaining and enforcing claims that are granted. However, our owned and licensed patents could be invalidated or narrowed or otherwise fail to adequately protect our proprietary and intellectual property position and our pending owned and licensed patent applications, and any patent applications that we may in the future file or license from third parties may not result in the issuance of patents. In addition, the term of individual issued patents depends upon the legal term for patents in the countries in which they are obtained. In most countries in which we have filed, including the United States, the patent term is 20 years from the earliest filing date of a non-provisional patent application. The life of a patent, and the protection it affords, is therefore limited and once the patent lives of our issued patents have expired, we may face competition, including from other competing technologies. As a result, our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours.

We also maintain trademarks associated with our commercial products. As of December 31, 2025, we had 11 registered trademarks, including trademark registrations for “ProxiCor®,” “Tyke®,” “VasCure®,” “SimpliDerm®,” and “SimpliDerm Ellipse®,” in the United States.

In addition to patents and licenses, we rely on confidentiality agreements with our employees, consultants, independent sales agents and third-party vendors to maintain the confidentiality of our trade secrets and proprietary information. Despite all of the aforementioned measures, there can be no assurance that our intellectual property rights will not be challenged, circumvented, invalidated, or independently developed by third parties. For a discussion of risks related to our intellectual property, see Part I, Item 1A. “Risk Factors  - Risks Related to Intellectual Property.”

License Agreement with Cook

We are party to a license agreement with Cook, which we refer to as the Cook License Agreement, that provides us with field-of-use rights to use porcine SIS-ECM technologies in specified cardiovascular applications. The agreement supports our ability to manufacture, market, and sell our Cardiovascular products within defined fields of use.

The license agreement also provides us with the option to access newer-generation, patent-protected SIS technologies for use in the licensed fields. We have elected not to utilize these patent-protected materials at this time; however, the agreement provides flexibility to access such technologies in the future if we determine that doing so is commercially or strategically appropriate.

Under the license and related supply arrangements, Cook, now owned by Evergen, is our exclusive supplier of SIS material for the licensed fields of use. The agreement includes minimum purchase requirements and other customary terms. The amended supply agreement currently remains in effect through December 31, 2028 and automatically renews for two additional two-year periods unless either party provides notice of non-renewal. The license agreement remains in effect until the earlier of the termination of the supply agreement or the expiration of the last licensed patent, which is currently expected to occur in 2031, excluding any patent term adjustments or extensions.

The Cook License agreement does not apply to our NXT-41 and NXT-41x development programs, which utilize different source material and is not procured from Evergen.

Regulatory Matters

Government Regulation

Our products are subject to extensive regulation by the FDA and other federal and state authorities in the United States, as well as comparable authorities in any foreign jurisdictions in which we market our products. In the United States, they fall under the regulations of the Federal Food, Drug, and Cosmetic Act (“FDCA”) as medical devices or as biological products under the Public Health Service Act (“PHSA”), enforced by the FDA. The FDA and other United States and foreign governmental agencies regulate, among other things, the development, design, nonclinical and clinical research, manufacturing, safety, efficacy, labeling, recordkeeping, premarket clearance or approval, promotion, marketing and distribution, and import and export of medical devices and biological products to ensure that such products distributed domestically are safe and effective for their intended uses and otherwise meet the requirements of the FDCA or PHSA.

FDA Premarket Clearance and Approval Requirements

In the United States, medical devices fall under the regulatory purview of the FDCA with classification into three categories based on risk. Class I devices, considered low-risk, are usually exempt from the 510(k) premarket notification. Class II devices, of moderate risk, require FDA clearance through a 510(k) submission, involving compliance with general controls and potential imposition of special controls, such as performance standards and post-market surveillance. The Quality Management System Regulation (“QMSR”) is a key aspect of general controls, ensuring adherence to quality standards in manufacturing processes. For the highest-risk Class III devices, PMA is required, encompassing life-sustaining devices, those with new intended uses, or utilizing advanced technology not substantially equivalent to existing devices. This comprehensive regulatory framework aims to ensure safety and effectiveness based on the specific risk levels of each device class.

510(k) Clearance Marketing Pathway

Certain of our ECM products are subject to premarket notification and clearance under Section 510(k) of the FDCA. To obtain 510(k) clearance, a product sponsor must submit to the FDA a premarket notification submission demonstrating that the proposed device is “substantially equivalent” to a predicate device already on the market. A predicate device is a legally marketed device that is not subject to premarket approval, i.e., a device that was legally marketed prior to May 28, 1976 and for which a PMA is not required, a device that has been reclassified from Class III to Class II or I, or a device that was found substantially equivalent through the 510(k) process.

The FDA’s 510(k) clearance process usually takes from three to twelve months, but may take longer. The FDA may require additional information, including clinical data, to make a determination regarding substantial equivalence. 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, 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 medical devices that are low to moderate risk and are not substantially equivalent to a predicate device.

Following 510(k) marketing clearance, significant modifications to a device, impacting safety or effectiveness or constituting a major change in intended use, necessitate a new 510(k) clearance, PMA approval, or de novo reclassification. Manufacturers initially determine the submission pathway, but the FDA can disagree and enforce marketing cessation or device recall until proper clearance or approval is obtained. Non-compliance may lead to regulatory fines or penalties.

PMA Approval Pathway

Class III devices necessitate PMA approval before marketing, although certain pre-amendment Class III devices without mandated PMAs are cleared through the 510(k) process. The PMA process, more rigorous than 510(k), requires manufacturers to demonstrate safety and efficacy with extensive pre-clinical and human clinical data, a full device description, manufacturing details, and proposed labeling. FDA has 180 days for PMA review, often extending beyond, with the possibility of convening an expert advisory panel for recommendations. A pre-approval inspection ensures compliance with the QMSR. FDA approves the device for commercial distribution if it deems PMA data as valid scientific evidence, ensuring reasonable assurance of safety and effectiveness. Post-approval conditions, including labeling restrictions and additional clinical studies, may accompany PMA approval. Post-market surveillance may be required as well. Non-compliance with approval conditions may lead to adverse enforcement actions, such as withdrawal of approval.

None of our products are currently marketed pursuant to a PMA.

Clinical Studies

Clinical studies are typically required to support a PMA and may be necessary for a 510(k) submission. In the United States, all device-related clinical investigations to determine safety and effectiveness must adhere to FDA's IDE regulations. IDE regulations govern investigational device labeling, restrict promotion, and outline recordkeeping, reporting, and monitoring responsibilities for sponsors and investigators. If a device presents a "significant risk" as defined by the FDA, an IDE application must be submitted and approved before initiating human clinical studies. An IDE application must be supported by relevant data, such as animal and laboratory test results, demonstrating safety for human testing and a scientifically sound protocol. The IDE becomes effective 30 days after FDA receipt unless modifications are required.

Regardless of the device's risk level, clinical studies require approval and oversight from an Institutional Review Board (“IRB”) at each site. The IRB conducts initial and ongoing reviews of the IDE, setting additional study requirements. If FDA and IRBs approve the IDE application, human clinical studies may commence.

During a study, the sponsor is required to comply with the applicable FDA requirements, including, for example, study monitoring, selecting clinical investigators and providing them with the investigational plan, ensuring IRB review, adverse event reporting, record keeping and prohibitions on the promotion of investigational devices. The clinical investigators in the clinical study are also subject to FDA’s regulations and must obtain patient informed consent, follow the investigational plan and study protocol, and comply with all reporting and recordkeeping requirements. After a study begins, we, the FDA or the IRB could suspend or terminate a clinical study at any time for various reasons, including a belief that the risks to study subjects outweigh the anticipated benefits.

Post-market Regulation

After a device is cleared or approved for marketing, numerous and pervasive regulatory requirements continue to apply. These include:

● establishment registration and device listing with the FDA;

● QMSR requirements, which require manufacturers, including third-party manufacturers, to follow stringent design, testing, control, documentation and other quality assurance procedures;

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

● clearance or approval of product modifications to 510(k)-cleared devices that could significantly affect safety or effectiveness or that would constitute a major change in intended use of one of our cleared devices;

● medical device reporting regulations, which mandate manufacturers to report to the FDA if a marketed device may have caused or contributed to a death or serious injury, or if it has malfunctioned and the device or a similar one in the market could likely cause serious harm if the malfunction were to recur.

● correction, removal and recall reporting regulations, which require that manufacturers report to the FDA field corrections and product recalls or removals if undertaken to reduce a risk to health posed by the device or to remedy a violation of the FDCA that may present a risk to health;

● post-market surveillance activities and regulations, which apply when deemed by the FDA to be necessary to protect the public health or to provide additional safety and effectiveness data for the device.

The FDA has broad regulatory compliance and enforcement powers. If the FDA determines that we failed to comply with applicable regulatory requirements, it can take a variety of compliance or enforcement actions, which may result in any of the following sanctions:

● warning letters, untitled letters, fines, injunctions, consent decrees and civil penalties;

● recalls, withdrawals, or administrative detention or seizure of our products;

● operating restrictions or partial suspension or total shutdown of production;

● refusing or delaying requests for 510(k) marketing clearance or PMA approvals of new products or modified products;

● withdrawing 510(k) clearances or PMA approvals that have already been granted;

● refusal to grant export approvals for our products; or

● criminal prosecution.

FDA Regulation of Combination Products

Certain products may be comprised of components, such as drug components and device components that would normally be regulated under different types of regulatory authorities, and frequently by different centers at the FDA. These products are known as combination products. Under the FDCA and its implementing regulations, the FDA is charged with assigning a center with primary jurisdiction, or a lead center, for review of a combination product. The designation of a lead center generally eliminates the need to receive approvals from more than one FDA center for combination products.

The determination of lead center is based on the “primary mode of action” of the combination product. The FDA has also established an Office of Combination Products to address issues surrounding combination products. In reviewing the application for a combination product, FDA reviewers in the lead center will generally consult with their counterparts in other centers to ensure that each component meets applicable requirements regarding safety, effectiveness, durability and performance.

FDA Regulation of HCT/Ps

Certain of our products fall under FDA regulation as Human Cells, Tissues, and Cellular and Tissue-Based Products (“HCT/Ps”) and may be categorized under Section 361 of the PHSA. This section allows the FDA to issue regulations preventing the spread of communicable diseases. These HCT/Ps must comply with various requirements, including facility registration, product listing, donor eligibility screening, and Good Tissue Practice for processing, storage, labeling, and distribution. These products, considered "minimally manipulated" and intended for "homologous use," do not require premarket authorization from the FDA for legal marketing in the U.S. “Homologous use” refers to use in the repair, reconstruction, replacement, or supplementation of a recipient’s cells or tissues with an HCT/P that performs the same basic function or functions in the recipient as in the donor. The HCT/P must also have no systemic effect and not depend upon the metabolic activity of living cells for its primary function. HCT/Ps failing to meet Section 361 criteria are regulated under Section 351 of the PHSA, requiring FDA premarket review and approval.

Regulations Governing Fraud and Abuse

Within the United States, our products and our customers are subject to extensive regulation by a wide range of federal and state agencies that govern business practices in the medical device and healthcare industry. These laws include federal and state anti-kickback, false claims, physician payment transparency, anti-corruption, and other fraud and abuse statutes and regulations. Internationally, other governments also impose regulations in connection with their healthcare reimbursement programs and the delivery of healthcare items and services.

In the United States, federal healthcare fraud and abuse laws generally apply to our activities because procedures using our products are covered under federal healthcare programs including Medicare and Medicaid. The Anti-Kickback Statute is particularly relevant because of its broad applicability. Specifically, the Anti-Kickback Statute prohibits persons from knowingly and willfully soliciting, offering, receiving, or providing remuneration, directly or indirectly, in exchange for, or to induce, either the referral of an individual, or the furnishing, arranging for or recommending a good or service for which payment may be made in whole or part under federal healthcare programs, such as the Medicare and Medicaid programs. Statutory exceptions and regulatory safe harbors protect certain interactions if specific requirements are met. A person or entity does not need to have actual knowledge of the Anti-Kickback Statute or specific intent in order to violate it to have committed a violation.

The healthcare industry is facing a heightened enforcement environment related to the federal Civil False Claims Act, with specific attention on actions initiated through the Act's whistleblower or qui tam provisions. This legal framework holds entities or individuals accountable for knowingly presenting false or fraudulent claims for payment by federal healthcare programs. It is noteworthy that claims stemming from violations of the federal Anti-Kickback Statute may also trigger scrutiny under the False Claims Act. The qui tam provisions empower private individuals to initiate actions on behalf of the government, providing them the opportunity to participate in any resulting financial recovery. The surge in legal actions against healthcare providers by private individuals, along with the potential for insurance companies to pursue treble damages against manufacturers under the federal Racketeer Influenced and Corrupt Organizations Act (RICO) for inducing false claims, underscores the industry's increased regulatory scrutiny, emphasizing the necessity for stringent compliance measures.

The federal Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act (the “HIPAA”), among other things, created two new federal crimes: healthcare fraud and false statements relating to healthcare matters. The HIPAA healthcare fraud statute prohibits, among other things, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, including private payors. A violation of this statute is a felony and may result in fines, imprisonment, and/or exclusion from government sponsored programs. The HIPAA false statements statute prohibits, among other things,

knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement or representation 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 Anti-Kickback Statute or specific intent in order to violate it to have committed a violation.

The federal Physician Payment Sunshine Act requires, among other things, manufacturers of drugs, devices, biologicals and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to the government information related to payments or other transfers of value made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain non-physician practitioners (physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists, anesthesiologist assistants and certified nurse midwives) and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members.

State, local, and foreign laws impact business practices in the medical device and pharmaceutical industries, including state anti-kickback and false claims laws affecting research, distribution, sales, and marketing. These laws also extend to claims involving healthcare items reimbursed by third-party payors or patients and may restrict payments to healthcare providers and referral sources. Additional regulations mandate pharmaceutical companies to comply with industry guidelines and federal guidance, while requiring drug manufacturers to report pricing and marketing information. State and local laws also necessitate tracking gifts and remuneration provided to physicians and healthcare entities. Violations of these laws, carrying potential criminal and civil penalties such as fines, exclusion from federal healthcare programs, disgorgement, and corporate integrity agreements, may be imposed on executives and employees, including imprisonment.

Data Privacy and Security Laws

Numerous state and federal laws, including consumer protection laws and regulations, govern the collection, dissemination, use, access to, confidentiality and security of personal information, including health-related information. In the United States, numerous federal and state laws and regulations, including data breach notification laws, health information privacy laws, and consumer protection laws and regulations govern the collection, use, disclosure and protection of health-related and other personal information could apply to our operations or the operations of our partners. Privacy and security laws, regulations, and other obligations are constantly evolving, may conflict with each other to complicate compliance efforts, and can result in investigations, proceedings, or actions that lead to significant civil and/or criminal penalties and restrictions on data processing.

Coverage and Reimbursement

Market acceptance and sales of our products to our customers, who primarily consist of hospitals, government facilities, and ambulatory surgery centers, will depend on the availability of payor coverage and the adequacy of reimbursement, for the procedures using our products, by government insurance programs and other third-party payors. Payor coverage and reimbursement for procedures using medical devices in the United States and international markets vary significantly by country.

In the United States, our currently approved products are commonly treated as general supplies utilized in surgical procedures and if covered by third-party payors, are paid for as part of the procedure. Outside of the United States, there are many reimbursement programs through private payors as well as government programs. In some countries, government reimbursement is the predominant program available to patients and hospitals. Our commercial success depends in part on the extent to which governmental authorities, private health insurers and other third-party payors provide coverage for and establish adequate reimbursement levels for the procedures during which our products are used. Failure by physicians, hospitals, ambulatory surgery centers and other users of our products to obtain sufficient coverage and reimbursement from third-party payors for procedures in which our products are used, or adverse changes in government and private third-party payors’ coverage and reimbursement policies, could have a material adverse effect on our business, financial condition and results of operations.

In our experience, third-party payors typically reimburse for surgical procedures involving our products when patients meet established medical necessity criteria. A trend towards managed care systems has been observed among certain payors, where healthcare cost control involves restricting authorizations for surgical procedures, including those utilizing our devices. While there is no uniform coverage and reimbursement policy among U.S. payors, decisions often hinge on factors such as the payor's determination that product use is a covered benefit, medically necessary for the specific indication, cost-effective, and not experimental or investigational. Reimbursement landscape variations exist from payor to payor in the United States. Third-party payors are increasingly auditing and challenging the prices charged for medical products and services with concern for upcoding, miscoding, using inappropriate modifiers, or billing for inappropriate care settings. Some third-party payors must approve coverage for new or innovative devices or procedures before they will reimburse healthcare providers who use the products or therapies. Even though a new product may have been cleared for commercial distribution by the FDA, we may find limited demand for the product unless and until reimbursement approval has been obtained from governmental and private third-party payors.

The Centers for Medicare & Medicaid Services (“CMS”) is responsible for administering the Medicare program and sets coverage and reimbursement policies for the Medicare program in the United States. CMS, in partnership with state governments, also administers the Medicaid program and Children’s Health Insurance Program (“CHIP”). CMS policies may alter coverage and payment related to our product portfolio in the future. These changes may occur as the result of national coverage determinations issued by CMS or as the result of local coverage determinations by contractors under contract with CMS to review and make coverage and payment decisions. Medicaid programs are funded by both federal and state governments, and may vary from state to state and from year to year and will likely play an even larger role in healthcare funding pursuant to the Affordable Care Act (“ACA”).

A key component in ensuring whether the appropriate payment amount is received for physician and other services, including those procedures using our products, is the existence of a Current Procedural Terminology (“CPT”) code, to describe the procedure in which the product is used. To receive payment, healthcare practitioners must submit claims to insurers using these codes for payment for medical services. CPT codes are assigned, maintained and annually updated by the American Medical Association and its CPT Editorial Board. If the CPT codes that apply to the procedures performed using our products are changed or deleted, reimbursement for performance of these procedures may be adversely affected.

In the United States, some insured individuals enroll in managed care programs, which monitor and often require pre-approval of the services that a member will receive. Some managed care programs pay their providers on a per capita (patient) basis, which puts the providers at financial risk for the services provided to their patients by paying these providers a predetermined payment per member per month and, consequently, may limit the willingness of these providers to use our products.

The escalating costs of medical products and services, covered by government and private health insurance, are compelling the healthcare and medical device industry to reduce expenses. Third-party reimbursement programs are employing sophisticated strategies like prospective reimbursement, capitation programs, and group purchasing, alongside measures such as benefit redesign and mandatory second opinions for major surgeries. Additionally, uncertainties in coverage policies and periodic changes to reimbursement levels, including routine updates for procedures using our products, pose challenges. The industry must adeptly navigate these complexities to align with evolving cost control measures in healthcare.

Healthcare Reform

Since its enactment, the ACA has faced challenges in the judicial, executive, and Congressional arenas. On June 17, 2021, the U.S. Supreme Court dismissed a challenge asserting the ACA's unconstitutionality on procedural grounds, affirming its continuation. Former President Biden's executive order, preceding the Supreme Court ruling, initiated a special enrollment period for ACA marketplace health insurance coverage from February 15, 2021, through August 15, 2021, prompting a review of healthcare access policies. The impact of other healthcare reform measures on our business remains uncertain. Legislative changes, including aggregate reductions in Medicare payments to providers, have occurred since the ACA's inception. Notably, heightened governmental scrutiny on product pricing has led to Congressional inquiries and legislation, emphasizing transparency, pricing relationships, and reforming reimbursement methodologies.

States are increasingly implementing regulations controlling product pricing, while third-party payors and authorities show growing interest in reference pricing systems, discounts, and list price disclosures.

Human Capital

As of December 31, 2025, we had 26 employees, and 25 employees were employed full-time. We believe our employee relations are good.

Recruiting and Retention

We believe that we have been successful in attracting and retaining qualified personnel with the appropriate background and skills to support our business and its growth. Although we believe our recruiting efforts have been successful to date, headcount reductions taken as part of cost saving initiatives and as our business strategy evolves may negatively impact our ability to attract qualified personnel in the future. See Part I.