biote Corp

Previous wording

We operate a high growth practice-building business within the hormone optimization space. Similar to a franchise model, we provide the necessary components to enable Biote-certified practitioners to establish, build, and successfully implement a program designed to optimize hormone levels using personalized solutions for their aging patient populations. The Biote Method (the “Biote Method”) is a comprehensive, end-to-end practice building platform that provides Biote-certified practitioners with the components specifically developed for practitioners in the hormone optimization space: Biote Method education, training and certification, practice management software, inventory management software, and information regarding available hormone replacement therapy (“HRT”) products, as well as digital and point-of-care marketing support. We also sell a complementary Biote-branded line of dietary supplements. We generate revenue by charging the Biote-partnered clinics fees associated with the support Biote provides for HRT and from the sale of Biote-branded dietary supplements. By virtue of our historical performance over the past 12 years, we believe that our business model has been successful, remains differentiated, and is well positioned for future growth.

Current wording

We operate a high growth practice-building business within the therapeutic wellness and hormone optimization space. Similar to a franchise model, we provide the necessary components to enable Biote-certified practitioners to establish, build, and successfully implement a program designed to optimize hormone levels using personalized solutions for their aging patient populations. The Biote Method (the “Biote Method”) is a comprehensive, end-to-end practice building platform that provides Biote-certified practitioners with the components specifically developed for practitioners in the therapeutic wellness and hormone optimization space: Biote Method education, training and certification, practice management software, inventory management software, and information regarding available hormone replacement therapy (“HRT”) products, as well as digital and point-of-care marketing support. We also sell a complementary Biote-branded line of dietary supplements. We generate revenue by charging fees associated with the support Biote provides for HRT to the Biote-partnered clinics and from the sale of Biote-branded dietary supplements. By virtue of our historical performance over the past 12 years, we believe that our business model has been successful, remains differentiated, and is well positioned for future growth.

Previous wording

Increase the number of Biote-certified practitioners. Our primary objective in marketing to healthcare providers is to inform them of the value in joining the Biote network. We accomplish this through provider referrals, a dedicated sales force, and through digital and traditional marketing channels. We target specific physicians based on their specialty, prescribing data, demographic information and location match with our existing geographic footprint.

Current wording

Increase the number of Biote-certified practitioners. Our primary objective in marketing to healthcare providers is to inform them of the value in joining the Biote network. We accomplish this through provider referrals, a dedicated sales force, and through digital and traditional marketing channels. We target specific physicians based on their specialty, prescribing data, demographic information and location match within our existing geographic footprint.

Previous wording

Increasing sales of Biote-branded dietary supplements. Our Biote-branded dietary supplement line currently includes 19 dietary supplements that we offer to our Biote-certified practitioners through our eCommerce site, efficiently leveraging our core Biote provider platform. Practitioners then re-sell Biote-branded dietary supplements to their patients, enabling patients to receive physician-guided therapies to manage the related effects of aging. Our direct-to-patient eCommerce platform enables practitioners to invite their patients to buy Biote-branded dietary supplements online via our online store.

Current wording

Increasing sales of Biote-branded dietary supplements. Our Biote-branded dietary supplement line currently includes 22 dietary supplements that we offer to our Biote-certified practitioners through our eCommerce site, efficiently leveraging our core Biote provider platform. Practitioners then re-sell Biote-branded dietary supplements to their patients, enabling patients to receive physician-guided therapies to manage the related effects of aging. Our direct-to-patient eCommerce platform enables practitioners to invite their patients to buy Biote-branded dietary supplements online via our online store.

Previous wording

The hormone pellet products used by Biote-certified practitioners are manufactured by third-party compounding pharmacies and shipped directly to Biote-certified practitioners. Custody of the pellets is with Biote-certified practitioners. However, the pellets are recorded as inventory on our financial statements from the date of shipment until such time as they are administered in a patient treatment as monitored and recorded in our BioTracker system as an additional service for administrative convenience of Biote-certified practitioners and Biote-partnered clinics.

Current wording

A majority of the hormone pellet products used by Biote-certified practitioners are manufactured by our 503B compounding pharmacy as well as by third-party compounding pharmacies and shipped directly to Biote-certified practitioners. Custody of the pellets is with Biote-certified practitioners. However, the pellets are recorded as inventory on our financial statements from the date of shipment until such time as they are administered in a patient treatment as monitored and recorded in our BioTracker system as an additional service for administrative convenience of Biote-certified practitioners and Biote-partnered clinics.

Previous wording

On January 29, 2024, we acquired certain assets of BioSana for $0.7 million in cash and a future earnout payment of up to $0.1 million upon the achievement of certain operating metrics.

Current wording

To strengthen control over our supply chain, enhance operational efficiency and reduce production costs, we are focused on vertical integration through strategic transactions. For example, in January 2024, we completed an asset acquisition of Simpatra, LLC (“Simpatra”), in which we purchased certain intellectual property and intellectual property rights for a purchase price of (i) $1.5 million in cash, (ii) 291,829 shares of our Class A common stock and (iii) a future earnout payment of 194,553 shares of our Class A common stock upon achieving certain financial targets over a four-year period. Additionally, in January 2024 we reached an agreement with BioSana ID LLC (“BioSana”) to purchase certain assets for a purchase price of (i) $0.7 million in cash and (ii) a future earnout payment of up to $0.1 million upon the achievement of certain operating metrics. Further, in March 2024, we acquired F.H. Investments, Inc. d/b/a Asteria Health (“Asteria Health”), a 503B manufacturer of compounded bioidentical hormones, for a purchase price of (i) $8.4 million in cash and (ii) a future earnout payment of up to $0.5 million upon the achievement of certain operating metrics. As part of the integration process associated with these strategic transactions, we are narrowing our current vendor network to better manage our supply chain. On November 1, 2024, AnazaoHealth provided notice that it was exercising its right to terminate the Pharmacy Services Agreement (the “AnazaoHealth Pharmacy Services Agreement”), which we previously entered into on October 30, 2020, with such termination to be effective as of May 1, 2025. While there is no guarantee that we will be able to negotiate a new agreement with AnazaoHealth and continue our partnership following such notice of termination on terms that are acceptable to us, if at all, we believe we can continue to meet the product demands of our Biote-practitioners through our existing direct manufacturing capabilities and vendor network while continuing to expand our vertical integration.

Previous wording

Revenue generated from individual Biote-partnered clinics varies significantly. This variability is due to many factors. These include: tenure of its practitioners as Biote-certified practitioners; the number of certified practitioners in an individual clinic; the number of patients served by a clinic; the clinic’s patient demographics; and the clinic’s geographic location and population density. The master services agreements (“MSAs”) we enter into with Biote-partnered clinics contain tiered pricing provisions for the management fees. These provisions provide for decreasing management fees owed to us based on the number of new patients treated. This can result in declines in revenue we realize from management fees from existing Biote-partnered clinics unless these are offset by revenue generated from newly acquired Biote-partnered clinics which begin at higher fee levels under the MSA.

Current wording

Revenue generated from individual Biote-partnered clinics varies significantly. This variability is due to many factors, including: tenure of its practitioners as Biote-certified practitioners; the number of certified practitioners in an individual clinic; the number of patients served by a clinic; the clinic’s patient demographics; and the clinic’s geographic location and population density. The master services agreements (“MSAs”) we enter into with Biote-partnered clinics contain tiered pricing provisions for the management fees. These provisions provide for decreasing management fees owed to us based on the number of new patients treated. This can result in declines in revenue we realize from management fees from existing Biote-partnered clinics unless these are offset by revenue generated from newly acquired Biote-partnered clinics which begin at higher fee levels under the MSA.

Previous wording

Our revenue was $96.0 million and $94.1 million, our net loss was $16.3 million and $34.5 million, and our Adjusted EBITDA was $26.9 million and $27.6 million, for the six months ended June 30, 2024 and 2023, respectively. Please refer to “Non-GAAP Measures” below for reconciliations of Adjusted EBITDA to the most directly comparable U.S. GAAP measure, net loss and for additional information about Adjusted EBITDA.

Current wording

Our revenue was $51.4 million and $45.6 million, our net income was $12.7 million and $19.6 million, and our Adjusted EBITDA was $16.2 million and $14.0 million, for the three months ended September 30, 2024 and 2023, respectively. Our revenue was $147.4 million and $139.7 million, our net loss was $3.4 million and $14.9 million and our Adjusted EBITDA was $43.1 million and $41.7 million, for the nine months ended September 30, 2024 and 2023, respectively. Please refer to “Non-GAAP Measures” below for reconciliations of Adjusted EBITDA to the most directly comparable U.S. GAAP measure, net loss and for additional information about Adjusted EBITDA.

Previous wording

Global economic conditions have been challenging, with disruptions to, and volatility in, the credit and financial markets in the U.S. and worldwide resulting from the effects of public health crises and otherwise. If these conditions persist and deepen, we could experience an inability to access additional capital or our liquidity could otherwise be impacted. If we are unable to raise capital when needed or on attractive terms, we would be forced to delay, reduce or eliminate our research and development programs and/or other efforts. A recession or additional market corrections resulting from the impact of the effects of global health crises, such as the COVID-19 pandemic, or geopolitical turmoil, such as the Israel-Hamas war, could materially affect our business and the value of our securities. The impact of global health crises and the related disruptions caused to the global economy did not have a material impact on our business during the three and six months ended June 30, 2024 and 2023.

Current wording

Global economic conditions have been challenging, with disruptions to, and volatility in, the credit and financial markets in the U.S. and worldwide resulting from the effects of public health crises and otherwise. If these conditions persist and deepen, we could experience an inability to access additional capital or our liquidity could otherwise be impacted. If we are unable to raise capital when needed or on attractive terms, we would be forced to delay, reduce or eliminate our research and development programs and/or other efforts. A recession or additional market corrections resulting from the impact of the effects of global health crises, such as the COVID-19 pandemic, or geopolitical turmoil, such as conflicts in the Middle East, could materially affect our business and the value of our securities. The impact of global health crises and the related disruptions caused to the global economy did not have a material impact on our business during the three and nine months ended September 30, 2024 and 2023.

Previous wording

Additionally, the recent trends of rising inflation may also materially adversely affect our business and corresponding financial position and cash flows. Inflationary factors, such as increases in the cost of our materials and supplies, interest rates and overhead costs may adversely affect our operating results. Relatively high interest and inflation rates also present a recent challenge impacting the U.S. economy and could make it more difficult for us to obtain traditional financing on acceptable terms, if at all, in the future. Although we do not believe that inflation has had a material impact on our financial position or results of operations to date, we may experience increases in the near future (especially if inflation rates continue to rise) on our operating costs, including our labor costs and research and development costs, due to supply chain constraints, consequences associated with global health crises and ongoing international conflicts such as the conflict between Russia and Ukraine and the Israel-Hamas war, and employee availability and wage increases, which may result in additional stress on our working capital resources.

Current wording

Additionally, inflationary factors, such as increases in the cost of our materials and supplies, interest rates and overhead costs may adversely affect our business and operating results. Inflation and relatively high interest rates also present a recent challenge impacting the U.S. economy and could make it more difficult for us to obtain traditional financing on acceptable terms, if at all, in the future. Although we do not believe that inflation has had a material impact on our financial position or results of operations to date, we may experience increases in the near future (especially if inflation rates continue to rise) on our operating costs, including our labor costs and research and development costs, due to supply chain constraints, consequences associated with global health crises and ongoing international conflicts such as the conflict between Russia and Ukraine and conflicts in the Middle East, and employee availability and wage increases, which may result in additional stress on our working capital resources.

Previous wording

Selling, general and administrative expense consists primarily of software licensing and maintenance and the cost of employees who engage in corporate functions, such as finance and accounting, information technology, human resources, legal, and executive management. Also included are rent occupancy costs, office expenses, recruiting expenses, entertainment allocations, depreciation and amortization, share-based compensation, transaction related expenses, other general overhead costs, insurance premiums, professional service fees, research and development and costs related to regulatory and legal matters and marketing expenses.

Current wording

Selling, general and administrative expense consists primarily of software licensing and maintenance, the cost of our sales force and the cost of employees who engage in corporate functions, such as finance and accounting, information technology, human resources, legal, and executive management. Also included are rent occupancy costs, office expenses, recruiting expenses, entertainment allocations, depreciation and amortization, share-based compensation, transaction related expenses, other general overhead costs, insurance premiums, professional service fees, research and development and costs related to regulatory and legal matters and marketing expenses.

Previous wording

Loss from change in fair value of earnout liability consists of the change in fair value of the Member and Sponsor earnouts during the period.

Current wording

Gain (loss) from change in fair value of earnout liabilities consists of the change in fair value during the period of the Member and Sponsor earnouts and the earnout related to the acquisition of Simpatra.

Previous wording

Revenue for the three months ended June 30, 2024 decreased $0.1 million to $49.2 million, or 0.2%, compared to the three months ended June 30, 2023, which was primarily driven by a $3.9 million decrease in Biote-branded dietary supplements, offset by a $2.8 million increase in revenue from pellet procedures. Furthermore, service revenue increased 74.9% during the three months ended June 30, 2024, compared with the corresponding period of the prior year, primarily as a result of technology fees earned from physician orders placed through our new platform, BioteRx and an increase in training revenue during the three months ended June 30, 2024, compared to the three months ended June 30, 2023.

Current wording

Revenue for the three months ended September 30, 2024 increased $5.8 million to $51.4 million, or 12.8%, compared to the three months ended September 30, 2023, which was primarily driven by a $2.5 million increase in revenue from pellet procedures and a $1.8 million increase in Biote-branded dietary supplements. Furthermore, service revenue increased $0.9 million during the three months ended September 30, 2024, compared with the corresponding period of the prior year, primarily as a result of technology fees earned from physician orders placed through our new platform, BioteRx, and an increase in training revenue during the three months ended September 30, 2024, compared to the three months ended September 30, 2023.

Previous wording

Cost of revenue for the three months ended June 30, 2024 decreased $0.5 million, to $15.3 million, or (3.4%), compared to the three months ended June 30, 2023. Cost of Biote branded dietary supplements decreased $2.2 million for the period primarily as a result of the decrease in Biote-branded dietary supplement revenue, compared with the corresponding period of the prior year. This decrease in cost of revenue was partially offset by a $0.8 million increase in cost of pellet procedures, which was driven by an increase in pellet procedure revenue, compared to the three months ended June 30, 2023.

Current wording

Cost of revenue for the three months ended September 30, 2024 increased $1.0 million, to $15.2 million, or 7.1%, compared to the three months ended September 30, 2023. Cost of Biote branded dietary supplements increased $1.1 million for the period primarily as a result of the increase in Biote-branded dietary supplement revenue, compared with the corresponding period of the prior year.

Previous wording

Selling, general and administrative expense for the three months ended June 30, 2024 increased $1.9 million to $27.6 million, or 7.3%, compared to the three months ended June 30, 2023. This increase was primarily due to a $1.4 million increase in payroll and related expenses that was driven by an increase in the Company’s executive-level headcount and expenses related to its first annual marketing event for Biote-certified practitioners since the onset of the COVID-19 pandemic of $1.3 million, compared with the corresponding period of the prior year. Additionally, during the three months ended June 30, 2024, amortization expense increased $0.4 million compared to the three months ended June 30, 2023, due to the addition of intangible assets acquired during the first quarter of 2024. These increases were partially offset by a $1.1 million decrease in legal expenses as a result of settling the Donovitz Litigation during the three months ended June 30, 2024. Additionally, during the three months ended June 30, 2024, expenses related to outsourced professional services decreased $0.7 million due to a decrease in consulting service fees and travel related expenses decreased $0.3 million compared to the three months ended June 30, 2023.

Current wording

Selling, general and administrative expense for the three months ended September 30, 2024 increased $0.2 million to $24.0 million, or 1.0%, compared to the three months ended September 30, 2023. This increase was primarily due to a $1.1 million increase in payroll and related expenses that was driven by an increase in the Company’s executive-level headcount and an increase in commissions earned as a result of the increase in revenue, compared with the corresponding period of the prior year. Additionally, during the three months ended September 30, 2024, amortization expense increased $0.4 million compared to the three months ended September 30, 2023, due to the addition of intangible assets acquired during the first quarter of 2024. These increases were partially offset by a $1.5 million decrease in legal expenses as a result of settling the Donovitz Litigation during the second quarter of 2024. Additionally, during the three months ended September 30, 2024, expenses related to outsourced professional services decreased $0.5 million due to a decrease in outsourced consulting services associated with management’s strategic initiatives, compared to the three months ended September 30, 2023.

Previous wording

Interest expense, net for the three months ended June 30, 2024, increased $0.9 million to $2.6 million compared to the three months ended June 30, 2023. The increase was primarily a result of $0.5 million in accreted interest related to our share repurchase liability, higher interest rates on our Term Loan during the period and a decrease in interest income earned on our money market account.

Current wording

Interest expense, net for the three months ended September 30, 2024, increased $2.0 million to $3.5 million compared to the three months ended September 30, 2023. The increase was primarily a result of $1.1 million in accreted interest related to our share repurchase liability, higher interest rates on our Term Loan during the period and interest on borrowings under our Revolving Loans. These increases were partially offset by a $0.8 million decrease in interest income earned on our money market account as a result of lower cash balances during the period and the maturation of a short-term investment, compared to the three months ended September 30, 2023.

Previous wording

The loss recognized from change in fair value of the earnout liability was primarily due to the change in the closing price of our Class A common stock during the three months ended June 30, 2024 and 2023. For the three months ended June 30, 2024, the closing price of the Company’s Class A common stock increased 28.8%, compared with an increase of 9.2% in the corresponding period of 2023. The increase in the closing price of our Class A common stock for the three months ended June 30, 2023 outpaced the increase in the closing price of our Class A common stock for the three months ended June 30, 2024, resulting in a decrease in the loss from change in the fair value of the earnout liability during the 2024 period.

Current wording

The change in fair value of the earnout liabilities was primarily due to an overall decrease in the earnout liabilities related to the Business Combination Agreement that resulted from the settlement of the Donovitz Litigation and the June 5, 2024 Litigation coupled with the change in the closing price of our Class A common stock during the three months ended September 30, 2024 and 2023. For the three months ended September 30, 2024, the closing price of the Company’s Class A common stock decreased 25.3%, compared with a decrease of 24.3% in the corresponding period of 2023. The decrease in the closing price of our Class A common stock for the three months ended September 30, 2024, outpaced the decrease in the closing price of our Class A common stock for the three months ended September 30, 2023, resulting in a gain from change in the fair value of the earnout liability during the current period.

Previous wording

Income tax expense for the three months ended June 30, 2024 decreased $0.7 million, compared to the three months ended June 30, 2023. This decrease in expense was primarily driven by a decrease in the forecasted annual tax rate of approximately 6.9% for the fiscal year ended December 31, 2024.

Current wording

Income tax expense for the three months ended September 30, 2024 decreased $0.7 million, compared to the three months ended September 30, 2023. This decrease in expense was primarily driven by quarter over quarter Biote ownership of Holdings remaining relatively flat for 2024 when compared to quarter over quarter increase in Biote ownership of Holdings in 2023.

Previous wording

The table and discussion below present our results for the six months ended June 30, 2024:

Current wording

The table and discussion below present our results for the nine months ended September 30, 2024:

Previous wording

Revenue for the six months ended June 30, 2024 increased $1.9 million to $96.0 million, or 2.0%, compared to the six months ended June 30, 2023, which was primarily driven by a $5.1 million increase in revenue from pellet procedures, partially offset by a 23.7% decrease in Biote-branded dietary supplements. Furthermore, service revenue increased 41.3% during the six months ended June 30, 2024, compared with the corresponding period of the prior year, primarily as a result of technology fees earned from physician orders placed through our new platform, BioteRx, during the six months ended June 30, 2024, compared to the six months ended June 30, 2023.

Current wording

Revenue for the nine months ended September 30, 2024 increased $7.7 million to $147.4 million, or 5.5%, compared to the nine months ended September 30, 2023, which was primarily driven by a $7.6 million increase in revenue from pellet procedures and a $0.8 million increase in revenue from disposable trocars. Furthermore, service revenue increased 68.6% to $3.4 million during the nine months ended September 30, 2024, compared with the corresponding period of the prior year, primarily as a result of technology fees earned from physician orders placed through our new platform, BioteRx, during the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023. These increases were partially offset by a 10.4% decrease in Biote-branded dietary supplements during the nine months ended September 30, 2024, compared with the corresponding period of the prior year.

Previous wording

Cost of revenue for the six months ended June 30, 2024 decreased $1.1 million, to $28.7 million, or (3.5%), compared to the six months ended June 30, 2023. Cost of Biote-branded dietary supplements decreased $3.3 million for the period primarily due to the decrease in Biote-branded dietary supplement sales, compared with the corresponding period of the prior year. This decrease in cost of revenue was partially offset by a $1.4 million increase in cost of pellet procedures, which was driven by the increase in revenue, compared to the six months ended June 30, 2023.

Current wording

Cost of revenue for the nine months ended September 30, 2024 remained flat at $43.8 million, compared to the nine months ended September 30, 2023. Cost of pellet procedures and disposable trocars increased $1.5 million and $0.4 million respectively, which was driven by the respective increases in revenue in the nine months ended September 30, 2024, compared with the corresponding period of the prior year. These increases in cost of revenue was offset by a $2.2 million decrease in cost of Biote-branded dietary supplements for the period primarily due to the decrease in Biote-branded dietary supplement sales, compared with the corresponding period of the prior year.

Previous wording

Selling, general and administrative expense for the six months ended June 30, 2024 increased $1.8 million to $50.7 million, or 3.7%, compared to the six months ended June 30, 2023. This increase was primarily due to a $2.0 million increase in payroll and related expenses that was driven by an increase in the Company’s executive-level headcount and expenses related to the Company’s first annual marketing event for Biote-certified practitioners since the onset of the COVID-19 pandemic of $1.0 million, compared with the corresponding period of the prior year. Marketing expenses increased $0.4 million during the six months ended June 30, 2024 due to an increase in web-based marketing and the production of informational materials in the ongoing effort to increase awareness of the products and services offered by Biote-certified practitioners compared to the six months ended June 30, 2023. Additionally, during the six months ended June 30, 2024, amortization expense increased $0.7 million compared to the six months ended June 30, 2023, due to the addition of intangible assets acquired during the first quarter of 2024. These increases were partially offset by a $1.2 million decrease in legal expenses as a result of settling the Donovitz Litigation during the six months ended June 30, 2024 and the completion of the acquisitions during the first quarter of 2024, compared to the six months ended June 30, 2023. Additionally, during the six months ended June 30, 2024, expenses related to outsourced professional services decreased $0.8 million due to a decrease in consulting service fees and travel related expenses decreased $0.4 million compared to the three months ended June 30, 2023.

Current wording

Selling, general and administrative expense for the nine months ended September 30, 2024 increased $2.1 million to $74.7 million, or 2.8%, compared to the nine months ended September 30, 2023. This increase was primarily due to a $3.1 million increase in payroll and related expenses that was driven by an increase in the Company’s executive-level headcount and an increase in commissions earned as a result of the increase in revenue, compared with the corresponding period of the prior year. Additionally, during the nine months ended September 30, 2024 we incurred expenses related to our first annual marketing event for Biote-certified practitioners since the onset of the COVID-19 pandemic of $1.0 million, compared with the corresponding period of the prior year. Furthermore, during the nine months ended September 30, 2024, amortization expense increased $1.1 million compared to the nine months ended September 30, 2023, primarily due to the addition of intangible assets acquired during the first quarter of 2024. These increases were partially offset by a $2.8 million decrease in legal expenses as a result of settling the Donovitz Litigation during the nine months ended September 30, 2024 and the completion of the acquisitions during the first quarter of 2024, compared to the nine months ended September 30, 2023. Additionally, during the nine months ended September 30, 2024, expenses related to outsourced professional services decreased $0.7 million due to a decrease in consulting service fees associated with management’s strategic initiatives and insurance expense decreased $0.7 million as a result of negotiating lower rates on select policies compared to the nine months ended September 30, 2023.

Previous wording

Interest expense, net for the six months ended June 30, 2024 increased $0.9 million to $4.2 million compared to the six months ended June 30, 2023. The increase was primarily a result of $0.5 million in accreted interest related to our share repurchase liability, higher interest rates on our Term Loan during the period and a decrease in interest income earned on our money market account.

Current wording

Interest expense, net for the nine months ended September 30, 2024 increased $3.0 million to $7.8 million compared to the nine months ended September 30, 2023. The increase was primarily a result of $1.5 million in accreted interest related to our share repurchase liability, higher interest rates on our Term Loan during the period and interest on borrowings under our Revolving Loans. These increases were partially offset by a $1.1 million decrease in interest income earned on our money market account as a result of a lower cash balances during the period and the maturation of a short-term investment compared to the nine months ended September 30, 2023.

Previous wording

The loss recognized from change in fair value of the earnout liability was primarily due to the change in the closing price of our Class A common stock during the six months ended June 30, 2024 and 2023. For the six months ended June 30, 2024, the closing price of the Company’s Class A common stock increased 51.2%, compared with an increase of 81.2% in the corresponding period of 2023. The increase in the closing price of our Class A common stock for the six months ended June 30, 2023 outpaced the increase in the closing price of our Class A common stock for the six months ended June 30, 2024, resulting in a decrease in the loss from change in the fair value of the earnout liability during the 2024 period.

Current wording

The change in fair value of the earnout liabilities was primarily due to an overall decrease in the earnout liabilities related to the Business Combination Agreement that resulted from the settlement of the Donovitz Litigation and the June 5, 2024 Litigation coupled with the change in the closing price of our Class A common stock during the nine months ended September 30, 2024 and 2023. For the nine months ended September 30, 2024, the closing price of the Company’s Class A common stock increased 13.0%, compared with an increase of 37.3% in the corresponding period of 2023. The percentage increase in the closing price of our Class A common stock for the nine months ended September 30, 2023 outpaced the percentage increase in the closing price of our Class A common stock for the nine months ended September 30, 2024. The impact of the 24.3% change in the price of our Class A common stock combined with the overall decrease in the earnout liability during the nine months ended September 30, 2024 resulted in a decrease in the loss from change in the fair value of the earnout liability in the nine months ended September 30, 2024, compared with the corresponding period of the prior year.

Previous wording

The change in other income (expense) for the six months ended June 30, 2024, compared to the six months ended June 30, 2023, primarily resulted from foreign currency fluctuations during the period.

Current wording

The change in other income (expense) for the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023, primarily resulted from foreign currency fluctuations during the period.

Previous wording

The following is a reconciliation of net loss to Adjusted EBITDA (in thousands) for the three and six months ended June 30, 2024 and 2023:

Current wording

The following is a reconciliation of net income (loss) to Adjusted EBITDA (in thousands) for the three and nine months ended September 30, 2024 and 2023:

Previous wording

Represents cash and non-cash interest on our debt obligations, commitment fees for our unused Revolving Loans, net of interest income earned on our money market account and short-term investment. For the three and six months ended June 30, 2024, interest expense, net included $0.5 million of accreted interest related to the share repurchase liability.

Current wording

Represents cash and non-cash interest on our debt obligations, commitment fees for our unused Revolving Loans, net of interest income earned on our money market account and short-term investment. For the three and nine months ended September 30, 2024, interest expense, net included $1.1 million and $1.5 million of accreted interest related to the share repurchase liability.

Previous wording

Represents depreciation expense on property and equipment, amortization expense on capitalized software and amortization expense on purchased intangible assets. Depreciation expense of $0.01 million was included in cost of products for the three and six months ended June 30, 2024.

Current wording

Represents depreciation expense on property and equipment, amortization expense on capitalized software and amortization expense on purchased intangible assets. Depreciation expense of $0.01 million and $0.03 million was included in cost of products for the three and nine months ended September 30, 2024, respectively.

Previous wording

Represents transaction costs including legal fees of $0.04 million during the six months ended June 30, 2024, and professional services fees of $0.9 million and legal fees of $0.5 million during the three months ended June 30, 2023 and professional services fees of $0.9 million and legal fees of $0.8 million for the six months ended June 30, 2023 that were incurred in connection with the filing of, and transactions contemplated by, the Company’s securities offerings.

Current wording

Represents transaction costs including legal fees of $0.04 million and $0.08 million during the three and nine months ended September 30, 2024, respectively, and legal fees of $0.07 million and filing fees of $0.2 million during the three months ended September 30, 2023 and legal fees of $0.9 million, filing fees of $0.2 million and professional services fees of $1.0 million for the nine months ended September 30, 2023 that were incurred in connection with the filing of, and transactions contemplated by, the Company’s securities offerings.

Previous wording

Represents professional services fees of $0.1 million incurred related to the accounting treatment of the share repurchase liability, strategic consulting and advisory services of $0.5 million, executive severance costs of $0.3 million and a realized foreign currency loss of less than $0.01 million for each of the three and six months ended June 30, 2024, and professional services fees of $0.05 million associated with the restatement of the Company’s financial statements for the quarters ended June 30, 2022 and September 30, 2022, executive severance costs of $0.2 million, costs related to recruiting executive level management, including the Chief Commercial Officer of $0.1 million and a realized foreign currency gain of less than $0.01 million for the three months ended June 30, 2023 and professional services fees of $0.1 million and legal fees of $0.1 million associated with the restatement of the Company’s financial statements for the quarters ended June 30, 2022 and September 30, 2022, executive severance costs of $0.2 million and costs related to recruiting executive level management, including the Chief Commercial Officer of $0.2 million and a realized foreign currency loss of $0.01 million for the six months ended June 30, 2023.

Current wording

Represents professional services fees of $0.07 million incurred related to the accounting treatment of the share repurchase liability and a realized foreign currency loss of less than $0.01 million during the three months ended September 30, 2024, and $0.2 million incurred related to the accounting treatment of the share repurchase liability, strategic consulting and advisory services of $0.6 million, executive severance costs of $0.3 million, excise tax related to repurchases of Class A common stock of $0.2 million and a realized foreign currency loss of less than $0.01 million for the nine months ended September 30, 2024, and executive severance costs of $0.04 million and a realized foreign currency loss of less than $0.01 for the three months ended September 30, 2023 and for the nine months ended September 30, 2023, executive severance costs of $0.3 million, a realized foreign currency loss of $0.02 million, costs related to recruiting executive level management, including the former Chief Commercial Officer of $0.2 million, and legal fees of $0.1 million and professional services fees of $0.1 million associated with the restatement of the Company’s financial statements for the quarters ended June 30, 2022 and September 30, 2022.

Previous wording

Represents legal fees of $0.2 million and $0.5 million and professional services fees of $0.2 million and $0.3 million incurred during the three and six months ended June 30, 2024, respectively, related to our recent acquisitions and other strategic opportunities. For the three and six months ended June 30, 2023, the amount represents professional services fees of $0.1 million and legal fees of $0.05 million associated with strategic opportunities to expand the business.

Current wording

Represents legal fees of $0.2 million incurred during the three months ended September 30, 2024 and legal fees of $0.7 million and professional services fees of $0.3 million incurred during the nine months ended September 30, 2024, respectively, related to our recent acquisitions and other strategic opportunities. For the three and nine months ended September 30, 2023, the amount represents professional services fees of $0.05 million, consulting fees of $0.1 million and legal fees of $0.3 million incurred during the three months ended September 30, 2023 and professional fees of $0.05 million, consulting fees of $0.3 million and legal fees of $0.4 million incurred during the nine months ended September 30, 2023 all of which were associated with strategic opportunities to expand the business.

Previous wording

Our liquidity is derived primarily from available cash and cash equivalents, cash generated from operations, capacity under our Revolving Loans and, when necessary, debt and equity financing activities. We believe that for at least the next 12 months, our current cash position, coupled with anticipated cash generated from operations and the capacity under our revolving loans, is sufficient to fund our operations and our debt service obligations. As of June 30, 2024 and December 31, 2023, we had cash and cash equivalents of $26.4 million and $89.0 million, respectively. Additionally, as of June 30, 2024 and December 31, 2023, we had $40.0 million and $50.0 million, respectively, of Revolving Loans available under our Truist Credit Agreement.

Current wording

Our liquidity is derived primarily from available cash and cash equivalents, cash generated from operations, capacity under our Revolving Loans and, when necessary, debt and equity financing activities. We believe that for at least the next 12 months, our current cash position, coupled with anticipated cash generated from operations and the capacity under our revolving loans, is sufficient to fund our operations and our debt service obligations. As of September 30, 2024 and December 31, 2023, we had cash and cash equivalents of $38.2 million and $89.0 million, respectively. Additionally, as of September 30, 2024 and December 31, 2023, we had $40.0 million and $50.0 million, respectively, of Revolving Loans available under our Truist Credit Agreement.

Previous wording

Net cash provided by operating activities for the six months ended June 30, 2024 decreased $2.4 million to $17.3 million compared to cash provided by operating activities of $19.8 million for the six months ended June 30, 2023. Our cash flow from working capital for the six months ended June 30, 2024, was impacted by a $0.3 million increase in Biote-branded dietary supplement inventory, compared with a $4.2 million decrease in Biote-branded dietary supplement inventory during the six months ended June 30, 2023. Additionally, in March 2024 we acquired Asteria Health, resulting in a $0.6 million increase in pellets in process and raw material used in the production of our pellets for the six months ended June 30, 2024. Further, due to the settlement of the Donovitz Litigation, legal and other related accrued liabilities decreased approximately $1.0 million compared to the six months ended June 30, 2023. During the six months ended June 30, 2024, we made investments in key sales and marketing initiatives, including our annual marketing event for Biote-certified practitioners, which impacted cash from working capital by $0.8 million, compared to the six months ended June 30, 2023. Cash used by these activities during the six months ended June 30, 2024 was partially offset by a $2.7 million reduction in cash used for advances on future inventory purchases, compared with the six months ended June 30, 2023.

Current wording

Net cash provided by operating activities for the nine months ended September 30, 2024 increased $12.9 million to $32.9 million compared to cash provided by operating activities of $19.9 million for the nine months ended September 30, 2023. Our cash flow from working capital for the nine months ended September 30, 2024, was primarily impacted by a $6.3 million reduction in cash used for advances on future inventory purchases and a $1.0 million decrease in income tax receivable, compared with the nine months ended September 30, 2023. Additionally, Biote-branded dietary supplement inventory decreased $2.1 million, compared with a $0.8 million decrease in Biote-branded dietary supplement inventory during the nine months ended September 30, 2023. Cash provided by these activities during the nine months ended September 30, 2024 was partially offset by a decrease in cash provided by accrued liabilities of approximately $4.0 million. Further, during the nine months ended September 30, 2024, we made investments in key sales and marketing initiatives, including our annual marketing event for Biote-certified practitioners, which impacted cash from working capital by $0.5 million, compared to the nine months ended September 30, 2023.

Previous wording

Net cash used in investing activities decreased $5.7 million to $15.5 million for the six months ended June 30, 2024, compared to $21.2 million for the six months ended June 30, 2023. This decrease was principally driven by the maturity of a $20.0 million short- term investment that was purchased in 2023 and not replaced with a new investment in 2024, partially offset by the acquisition of Asteria Health, Simpatra and BioSana during the six months ended June 30, 2024.

Current wording

Net cash used in investing activities decreased $4.2 million to $17.5 million for the nine months ended September 30, 2024, compared to $21.7 million for the nine months ended September 30, 2023. This decrease was principally driven by the maturity of a $20.0 million short-term investment that was purchased in 2023 and not replaced with a new investment in 2024, partially offset by the acquisition of Asteria Health, Simpatra and BioSana during the nine months ended September 30, 2024.

Previous wording

Net cash used in financing activities increased $55.1 million to $64.4 million for the six months ended June 30, 2024, compared to $9.3 million for the six months ended June 30, 2023. The increase in our cash flow used in financing activities was primary driven by a $62.2 million payment on our share repurchase liability that we recorded related to the settlement of the Donovitz Litigation and the June 5, 2024 Litigation. Additionally we used cash of $5.6 million to repurchase Class A common stock during the six months ended June 30, 2024. This increase was partially offset by a $10.0 million draw under our Revolving Loans, which was used to fund a portion of the $62.2 million payment on the share repurchase liability and a $2.4 million reduction in distributions to our partners during the six months ended June 30, 2024, compared to the six months ended June 30, 2023.

Current wording

Net cash used in financing activities increased $54.3 million to $66.1 million for the nine months ended September 30, 2024, compared to $11.9 million for the nine months ended September 30, 2023. The increase in our cash flow used in financing activities was primary driven by a $62.2 million payment on our share repurchase liability that we recorded related to the settlement of the Donovitz Litigation and the June 5, 2024 Litigation. Additionally we used cash of $5.6 million to repurchase Class A common stock during the nine months ended September 30, 2024. This increase was partially offset by a $10.0 million draw under our Revolving Loans, which was used to fund a portion of the $62.2 million payment on the share repurchase liability and a $2.9 million reduction in distributions to our partners during the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023.