Orchestra BioMed Holdings, Inc.
For the period ended Dec 31, 2025. Filed Mar 12, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Mar 12, 2026
OBIO$5.68+1.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-31.
0001558370-25-004161
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-12.
0001104659-26-026754
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 151 previous paragraphs and 120 current paragraphs.
56 unchanged; 41 reworded; 23 added; 53 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 15 previous and 15 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (23)
Current report
On January 9, 2026, Haemonetics Corporation (“Haemonetics”), a global medical technology company focused on delivering innovative solutions designed to improve patient outcomes, announced its acquisition of Vivasure Medical Limited (“Vivasure”), a Galway, Ireland-based company pioneering next-generation technology for percutaneous vessel closure. Vivasure was a strategic holding of ours prior to its acquisition. In connection with the closing of the transaction, we can receive up to $10.7 million of proceeds in 2026 associated with the transaction. In January, we received the initial upfront payment of $4.7 million and the remainder may be received in 2026 based on the achievement of a milestone. We may receive additional proceeds in the future associated with revenue earnouts based on the achievement of certain milestones.
Current report
On October 28, 2025, we entered into a termination and right of first refusal agreement (the “Termination and ROFR Agreement”) with Terumo with respect to Virtue SAB. The Termination and ROFR Agreement, which supersedes and terminates the Terumo Agreement, grants Terumo a right of first refusal (“ROFR”) to acquire the rights, or enter a distribution arrangement, with respect to Virtue SAB for the treatment of coronary artery disease, in exchange for an upfront payment of $10.0 million. In connection with the Termination and ROFR Agreement, on November 7, 2025, Terumo invested an additional $20.0 million in Orchestra BioMed through our Series A Preferred Stock, which is convertible into common stock in the future, subject to certain conditions, at a minimum of $12 per share. Pursuant to the terms of the Termination and ROFR Agreement, Orchestra BioMed, Inc. has no further performance obligations under the Terumo Agreement and therefore recognized the remaining amounts of deferred revenue. We recognized $30.0 million in cumulative partnership revenues from 2019 through December 31, 2025. In addition to recognizing the remainder of the deferred revenue, partnership revenue for the year ended December 31, 2025 included $10.0 million in consideration for the ROFR and $7.4 million associated with the premium above the fair market value of the Series A Preferred Stock.
Current report
In June 2022, Orchestra BioMed, Inc. entered into the Medtronic Agreement for the development and commercialization of AVIM Therapy for the treatment of pacemaker-indicated patients with uncontrolled HTN despite the use of anti-hypertensive medications. On July 31, 2025, Orchestra BioMed, Inc., our wholly owned subsidiary BackBeat Medical, LLC, and Medtronic entered into an amendment to the Medtronic Agreement, which became effective on August 4, 2025 (the “Medtronic Agreement Amendment”), to provide, among other things, a development and commercialization framework for future AVIM-therapy integration into a dual-chamber leadless pacemaker. Pursuant to the Medtronic Agreement Amendment, we will be required, among other things, to reimburse Medtronic for certain expenses incurred in connection with the integration of AVIM-therapy into Medtronic’s dual-chamber leadless pacemaker, up to a specified cap.
Current report
Interest (Expense) Income, Net
Current report
On July 31, 2025, we entered into a revenue participation right purchase and sale agreement (the “Royalty Purchase Agreement”) with Ligand Pharmaceuticals Incorporated (“Ligand”). Under the terms of the Royalty Purchase Agreement, in exchange for payment of $35.0 million (the “Investment Amount”), less certain reimbursable expenses, Ligand acquired the right to receive tiered royalty payments from us (the “Royalty Interest”) with respect to revenue (including certain licensing revenue) received by us in a calendar year in connection with worldwide net product sales, or other product revenue received by, by us and our licensees (“Annual Net Sales”) of (a) AVIM Therapy (the “Primary Product”) and (b) Virtue SAB (the “Secondary Product” and together with the Primary Product, the “Products”) in the field of coronary artery treatment. At execution of the Royalty Purchase Agreement, our estimate of this total interest expense resulted in an effective annual interest rate of approximately 23.1%. This estimate contains significant assumptions that impact both the amount recorded at execution and the interest expense that will be recognized over the royalty period. We will periodically assess the estimated amounts due and payable to Ligand and to the extent the amount or timing of such payments is materially different than the original estimates, an adjustment will be recorded prospectively to increase or decrease interest expense. There are a number of factors that could materially affect the amount and timing of the royalty payments to be paid by us to Ligand and, correspondingly, the amount of interest expense recorded by us.
Current report
Change in the fair value of derivative liability
Current report
In November 2025, we sold 200,000 shares of Series A Preferred Stock at a purchase price equal to $100.00 per share for gross proceeds of $20.0 million. We concluded that certain conversion and redemption features meet the requirements to be separately accounted for as a bifurcated derivative. As a result, we bifurcated the Series A Preferred Stock between (i) the host contract, which was accounted for within mezzanine equity, and (ii) the bifurcated derivative liabilities related to those conversion and redemption features. The bifurcated derivatives are remeasured to fair value at each reporting period with changes in fair value recorded in the consolidated statement of operations and comprehensive loss.
Current report
Interest (Expense) Income, Net
Current report
Change in the fair value of derivative liability
Current report
The derivative liability of the Series A Preferred Stock was remeasured to a fair value of $2.7 million as of December 31, 2025. We recognized a gain of $254,000 for the year ended December 31, 2025, primarily driven by decreases in our stock price compared to initial measurement at issuance.
Current report
We intend to prioritize spending on our two flagship product candidates and expect operating expenses to increase accordingly as we focus on continued execution of the BACKBEAT study for AVIM Therapy and ramp up execution of the recently initiated Virtue Trial for Virtue SAB. The additional investment will primarily support clinical study costs as well as other research and development activities.
Current report
Net cash provided by financing activities of $88.3 million for the year ended December 31, 2025 primarily consisted of $57.8 million of proceeds from the sale of common stock and the pre-funded warrants, net of issuance costs and $20.0 million of proceeds from the sale of future royalties, $12.6 million of proceeds from the issuance of Series A Preferred Stock, partially offset by $1.6 million used to settle taxes associated with the vesting of restricted stock units.
Current report
On October 28, 2025, we entered into the Termination and ROFR Agreement with Terumo with respect to Virtue SAB. The Termination and ROFR Agreement, which supersedes and terminates the Terumo Agreement, grants Terumo a ROFR to acquire the rights, or enter a distribution arrangement, with respect to Virtue SAB for the treatment of coronary artery disease, in exchange for an upfront payment of $10.0 million. In connection with the Termination and ROFR Agreement, Terumo invested an additional $20.0 million in Orchestra BioMed through our Series A Preferred Stock, which is convertible into common stock in the future, subject to certain conditions, at a minimum of $12 per share. Pursuant to the terms of the Termination and ROFR Agreement, we have no further performance obligations under the Terumo Agreement and therefore recognized the remaining amounts of deferred revenue. We recognized $30.0 million in cumulative partnership revenues from 2019 through December 31, 2025. In addition to recognizing the remainder of the deferred revenue, partnership revenue for the year ended December 31, 2025 included $10.0 million in consideration for the ROFR and $7.4 million associated with the premium above the fair market value of the Series A Preferred Stock.
Current report
Royalty purchase agreement
Current report
On July 31, 2025, we entered into the Royalty Purchase Agreement with Ligand. Under the terms of the Royalty Purchase Agreement, in exchange for the Investment Amount, less certain reimbursable expenses, Ligand acquired from us the right to receive Royalty Interest with respect to revenue (including certain licensing revenue) received by us in a calendar year in connection with Annual Net Sales of our Products in the field of coronary artery treatment.
Current report
Pursuant to the Royalty Purchase Agreement, the Investment Amount shall be paid in two tranches: (i) $20.0 million was paid on August 4, 2025 (the “Ligand Closing”) and (ii) $15.0 million is payable on May 1, 2026 (the “Second Installment”), provided certain conditions have been met. In repayment of the Investment Amount, we will remit 17.0% of revenues related to the Products until an annual total of $17.0 million has been remitted to Ligand, thereafter we will remit (a) 4.0% of revenues related to the Primary Product in the field of hypertension treatment and (b) 4.0% of revenues related to the Secondary Product in the field of coronary artery treatment. In addition, under the terms of the Royalty Purchase Agreement, unless and until Ligand pays the Second Installment, Ligand shall only be entitled to 57.1% of the amounts it would otherwise be due under the Royalty Purchase Agreement. However, regardless of whether the Second Installment has been paid, under the terms of the Royalty Purchase Agreement, the percentages referenced in the second sentence of this paragraph will incrementally increase from 17.0% and 4.0% up to 20.0% and 7.0%, respectively, if we do not achieve certain enrollment milestones relating to the BACKBEAT clinical study through January 1, 2027.
Current report
We accounted for the sale of royalty revenues to Ligand, pursuant to the Royalty Purchase Agreement, in accordance with ASC 470,Debt, which addresses situations in which an entity receives cash from an investor in return for an agreement to pay the investor a specified percentage of the revenue from a contractual right. We classified the proceeds received from the sale to Ligand as debt as we determined that it had significant continuing involvement in the generation of the cash flows to Ligand. Interest related to the Royalty Purchase Agreement is recognized utilizing the effective interest method over the estimated term. When the Second Installment is received, it will also be recorded as a liability related to the sale of future royalties when they are received and amortized under the effective interest method over the estimated remaining term of the Royalty Purchase Agreement.
Current report
As of the Ligand Closing, our estimate of this total interest expense associated with the Royalty Interest resulted in an effective annual interest rate of approximately 23.1%. This estimate contains significant assumptions that impact both the amount recorded at execution and the interest expense that will be recognized over the royalty period. We will periodically assess the estimated amounts due and payable to Ligand and to the extent that the amount or timing of such payments is materially different than the original estimates, an adjustment will be recorded prospectively to the consolidated statements of operations and comprehensive loss. There are a number of factors that could materially affect the amount and timing of the royalty payments to be paid by us to Ligand and, correspondingly, the amount of interest expense recorded by us.
Current report
On November 7, 2025, we entered into a preferred stock purchase agreement, pursuant to which we agreed to issue 200,000 shares of our Series A Preferred Stock at a price per share equal to $100.00 for an aggregate amount of $20.0 million. The Series A Preferred Stock contains certain conversion and redemption features. We utilized an option pricing valuation to determine the fair value of the Series A Preferred Stock at issuance. The valuation incorporated Level 3 inputs in the fair value hierarchy including the expected life of Series A Preferred Stock, expected volatility, and discount rate as well as probability-weighted outcomes. Assumptions used in the valuation also take into account the contractual terms as well as the quoted price of our common stock in an active market. Significant changes in any of these inputs in isolation would result in significant changes to the fair value measurement.
Current report
Derivative Liability
Current report
In connection with the issuance of the Series A Preferred Stock, we evaluated the instruments for any features that must be bifurcated and separately accounted for as embedded derivatives. We concluded that certain conversion and redemption features meet the requirements to be separately accounted for as a bifurcated derivative. The Series A Preferred Stock was accounted for as mezzanine equity in accordance with ASC 480,Distinguishing Liabilities from Equity (“ASC 480”) and the embedded conversion and redemption features were separated from the host instrument and recognized as a derivative liability with the change in fair value at each reporting period end recognized in the consolidated statements of operations and comprehensive loss.
Current report
We performed a “with-and-without” scenario analysis to determine the fair value of the derivative liability by comparing the value of the Series A Preferred Stock including the bifurcated embedded derivatives to the value of the Series A Preferred Stock excluding them. We utilized an option pricing valuation with the expected life of Series A Preferred Stock, expected volatility, and discount rate as significant inputs as well as probability-weighted outcomes. Assumptions used in the valuation also take into account the contractual terms as well as the quoted price of our common stock in an active market. Significant changes in any of those inputs in isolation would result in significant changes to the fair value measurement.
Current report
Smaller Reporting Company Status
Removed paragraphs (53)
Previous report
Closing of Business Combination
Previous report
Prior to January 26, 2023, the Company was a special purpose acquisition company formed for the purpose of entering into a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities. On January 26, 2023, we consummated the business combination contemplated by the Agreement and Plan of Merger, dated as of July 4, 2022 (as amended by Amendment No. 1 to Agreement and Plan of Merger, dated July 21, 2022, and Amendment No. 2 to Agreement and Plan of Merger, dated November 21, 2022, the “Merger Agreement”) by and among Health Sciences Acquisitions Corporation 2, a special purpose acquisition company incorporated as a Cayman Islands exempted company in 2020 and Orchestra’s predecessor (“HSAC2”), HSAC Olympus Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of HSAC2 (“Merger Sub”), and Orchestra BioMed, Inc. (“Legacy Orchestra”). Pursuant to the Merger Agreement, (i) HSAC2 deregistered in the Cayman Islands in accordance with the Companies Act (2022 Revision) (As Revised) of the Cayman Islands and domesticated as a Delaware corporation in accordance with Section 388 of the Delaware General Corporation Law (the “Domestication”) and (ii) Merger Sub merged with and into Legacy Orchestra, with Legacy Orchestra as the surviving company in the merger and, after giving effect to such merger, continuing as a wholly owned subsidiary of Orchestra (the “Merger” and, together with the Domestication and the other transactions contemplated by the Merger Agreement, the “Business Combination”). As part of the Domestication, we changed our name from “Health Sciences Acquisitions Corporation 2” to “Orchestra BioMed Holdings, Inc.” On January 27, 2023, our common stock (“Company Common Stock”) began trading on the Nasdaq Global Market under the symbol “OBIO.” For additional information, seeNote 3 to the Consolidated Financial Statements – “Business Combination and Recapitalization.”
Previous report
Reverse Recapitalization
Previous report
The Business Combination is accounted for as a reverse recapitalization (the “Reverse Recapitalization”) in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Under this method of accounting, HSAC2 is treated as the “acquired” company and Legacy Orchestra is treated as the acquirer for financial reporting purposes. As a result, the consolidated assets, liabilities and results of operations prior to the Reverse Recapitalization are those of Legacy Orchestra. Additionally, the shares and corresponding capital amounts and losses per share, prior to the Business Combination, have been retroactively restated based on the exchange ratio established in the Merger Agreement (the “Exchange Ratio”). For additional information on the Business Combination and the Exchange Ratio, seeNote 3 to the Consolidated Financial Statements – “Business Combination and Recapitalization.”
Previous report
Our flagship product candidates are atrioventricular interval modulation (“AVIM”) therapy (formerly referred to as BackBeat Cardiac Neuromodulation Therapy (“BackBeat CNT”), for the treatment of hypertension (“HTN”), a significant risk factor for death worldwide,
Previous report
As discussed further below under the heading*“Liquidity and Capital Resources— Funding Requirements,”* in this Item 7, because our cash, cash equivalents and short-term investments as of December 31, 2024 are not sufficient to fund our operations for at least the next twelve months from the date of issuance of the consolidated financial statements included elsewhere in this Annual Report on Form 10-K, there is substantial doubt about our ability to continue as a going concern. The consolidated financial statements have been prepared on the basis that the Company will continue to operate as a going concern, which contemplates it will be able to realize assets and settle liabilities and commitments in the normal course of business for the foreseeable future. Accordingly, the consolidated financial statements do not include any adjustments that may result from the outcome of these uncertainties. See “Basis of Presentation and Liquidity,” in Note 1 to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K.
Previous report
As previously disclosed, we have been negotiating with Terumo for mutually agreeable adjustments to the Terumo Agreement with the purpose of restructuring milestone payments as well as making other potential material modifications to that agreement, including additional financial commitments by Terumo to Orchestra and the Virtue SAB program. More recently, we and Terumo have been negotiating terms for a new strategic alliance agreement that would, among other things, (i) replace the Terumo Agreement; (ii) have Terumo make certain upfront and milestone-based payments to us; and (iii) narrow the scope of Terumo’s rights to only coronary applications of Virtue SAB. Because there had not been an agreement on the terms of such new strategic alliance agreement, we previously provided Terumo with a notice of breach of the Terumo Agreement, as we believe that Terumo has failed to, among other things, meet certain clinical and regulatory obligations under the Terumo Agreement, which has resulted in significant damages to us. We believe Terumo’s breaches of the Terumo Agreement provide us with a termination right under the Terumo Agreement, which we could exercise at any time. We further believe we would be entitled to significant damages as a result of Terumo’s breaches if we are unable to come to a negotiated resolution with Terumo.
Previous report
The parties are now in a mediation procedure pursuant to the Terumo Agreement and the International Mediation Rules of the International Centre for Dispute Resolution (“ICDR”). The mediation could assist in potentially resolving disagreements and facilitating the completion of negotiations. The Terumo Agreement provides that matters that are not resolved through mediation are to be resolved by binding arbitration conducted under the auspices of the ICDR in accordance with its International Arbitration Rules.
Previous report
The parties have not yet agreed to the procedural parameters of such mediation, including the terms of a standstill arrangement, pursuant to which neither party would exercise any termination rights under the Terumo Agreement during the mediation period. As noted above, we believe that we have the right to terminate the Terumo Agreement in connection with Terumo’s aforementioned material breaches of their obligations thereunder. Terumo has the right to terminate the agreement, or certain of its obligations thereunder, if certain milestones are not achieved over time. In this regard, under the terms of the Terumo Agreement, if we do not file a PMA for Virtue SAB for the treatment of ISR by March 30, 2025 (the “Virtue SAB PMA Deadline”), Terumo has the right to terminate the Terumo Agreement. We did not meet the Virtue SAB PMA Deadline. Accordingly, as of March 31, 2025, Terumo may seek to terminate the Terumo Agreement, although we understand that no such step is imminent. Nonetheless, absent an agreement related to the mediation or otherwise, both we and Terumo would be free to exercise any termination rights we each may have in accordance with the terms of the Terumo Agreement.
Previous report
The mediation proceeding could lead to various outcomes which may affect the terms or status of the Terumo Agreement, the most likely of which may include (i) we and Terumo agree to enter into a new strategic alliance agreement that replaces and substantially restructures the terms of the Terumo Agreement, including material changes to the scope of indications and territories to which Terumo would have rights; or (ii) we and Terumo mutually agree to terms whereby the Terumo Agreement is terminated.
Previous report
If the mediation does not lead to an agreement or resolution, or, if applicable, we do not prevail in arbitration, or if the Terumo Agreement is terminated, our clinical study, product development, and commercialization plans for Virtue SAB may be further adversely impacted. However, any termination of the Terumo Agreement in the context of an arbitration or otherwise would allow us to pursue an alternative strategic collaboration or other transaction with a different partner.
Previous report
As described elsewhere in this Annual Report on Form 10-K, we have recently submitted to the FDA a proposed amendment to our approved IDE to change the design of the Virtue ISR-US pivotal study so that we can randomize patients with coronary ISR 1:1 to either treatment with Virtue SAB or Boston Scientific Corporation’s AGENT™ paclitaxel-coated balloon. We currently expect to receive FDA approval for an amended IDE in the first half of 2025. Once we receive approval for the IDE amendment, we are targeting initiation of enrollment of the Virtue ISR-US study in the second half of 2025. We may elect to initiate enrollment regardless of the status or outcome of our negotiations with Terumo.
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Registration Statement
Previous report
Due to the significant number of redemptions of HSAC2’s ordinary shares in connection with the Business Combination, there was a significantly lower number of HSAC2 ordinary shares that converted into shares of Company Common Stock in connection with the Business Combination. Pursuant to the Amended and Restated Registration Rights Agreement we entered into in connection with the closing of the Business Combination and certain warrant agreements, we filed a registration statement (the “Registration Statement”), which was declared effective on May 9, 2024, that registers, among other things, the resale of an aggregate of 18,586,201 shares of Company Common Stock, which constitutes approximately 49% of the outstanding Company Common Stock as of March 27, 2025. Additionally, some of the shares of the Company Common Stock being registered for resale were originally purchased by selling stockholders pursuant to investments in Legacy Orchestra or HSAC2 at prices considerably below the current market price of the Company Common Stock. These selling stockholders may realize a positive rate of return on the sale of their shares of Company Common Stock covered by the Registration Statement and therefore will have an incentive to sell their shares. Public shareholders may not experience a similar rate of return on shares of Company Common Stock they purchased. This discrepancy in purchase prices may have an impact on the market perception of the Company Common Stock’s value and could increase the volatility of the market price of the Company Common Stock or result in a significant decline in the public trading price of the Company Common Stock. The registration of these shares of Company Common Stock for resale creates the possibility of a significant increase in the supply of the Company Common
Previous report
Stock in the market. The increased supply, coupled with the potential disparity in purchase prices, may lead to heightened selling pressure, which could negatively affect the public trading price of the Company Common Stock.
Previous report
Under the Terumo Agreement, we were initially eligible for certain milestone payments in the amount of $65 million from Terumo upon completion of certain minimum enrollments in clinical studies, making certain filings and submissions, and obtaining certain regulatory approvals and certifications, and are also eligible to earn royalties on future sales by Terumo based on royalty rates ranging from 10-15%. Of these milestone payments, $35 million relate to achieving certain milestones by specified target achievement dates. As of the date of this Annual Report on Form 10-K, the target achievement dates for three $5 million milestone payments have already passed, in each case, without achieving the related milestones. In addition, due to delays in our Virtue SAB program resulting from the COVID 19 pandemic, supply chain issues and unexpected changes to regulatory requirements, including increased testing and other activities related to chemistry, manufacturing, and control, increased nonclinical and good laboratory practice preclinical data requirements, including biocompatibility, as well as a requirement to repeat good laboratory practice preclinical studies already performed based on changes to source of component materials and a change in manufacturing site, that caused us to amend our original project plan, we are unlikely to be able to complete the remaining time-based milestones by the specified target achievement dates to earn the remaining $20 million in time-based milestone payments pursuant to the Terumo Agreement.
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Interest Income, Net
Previous report
In June 2022, Legacy Orchestra entered into a loan and security agreement (the “2022 Loan and Security Agreement”) with Avenue Venture Opportunities Fund, L.P. (“Avenue I”) and Avenue Venture Opportunities Fund II, L.P. (“Avenue II,” and, collectively with Avenue I, “Avenue”). The term loan had a maturity date of June 1, 2026 and accrued interest at a floating per annum rate equal toThe Wall Street Journal prime rate plus 6.45%. On October 6, 2023, the 2022 Loan and Security Agreement was repaid in full and terminated.
Previous report
Loss on Fair Value Adjustment of Warrant Liability
Previous report
Certain of Legacy Orchestra’s outstanding warrants contained features that required the warrants to be accounted for as liabilities. The warrants were subject to re-measurement at each balance sheet date with gains and losses reported through Legacy Orchestra’s consolidated statements of operations and comprehensive loss as loss on fair value adjustment of warrant liability. Upon closing of the Business Combination, all liability classified warrants of Legacy Orchestra became equity classified on that date as they are now considered “fixed for fixed.”
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Loss on Debt Extinguishment
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The loss on debt extinguishment represents charges incurred as a result of the payoff of each of the 2019 Loan and Security Agreement and the 2022 Loan and Security Agreements.
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*Note: NM denotes that the computed amount is not meaningful.
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While we believe we have estimated total costs associated with the Terumo Agreement through completion, these estimates encompass a broad range of expenses over a multi-year period and, as such, are subject to periodic changes as new information becomes available.
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Interest Income, Net
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Loss on Fair Value Adjustment of Warrant Liability
Previous report
The loss on fair value adjustment of warrant liability was $294,000 for the year ended December 31, 2023 and was the result of the final valuation of our outstanding warrants when they had become equity classified and no longer subject to market adjustment upon the
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close of the Business Combination. There were no additional charges for the adjustment of fair value for warrant liability for the year ended December 31, 2024.
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Loss on Debt Extinguishment
Previous report
The loss on debt extinguishment was $1.2 million for the year ended December 31, 2023, which was due to recognition of unamortized debt discount as well as early termination payments related to the early termination and repayment of the 2022 Loan and Security Agreement in October 2023.
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During the year ended December 31, 2023, we and Motus GI entered into an agreement, pursuant to which royalty certificates previously issued to us and other holders were amended to terminate the rights of royalty certificate holders to receive royalties in exchange for shares of Motus GI common stock. As a result of the agreement, we received 701,522 shares of Motus GI common stock in exchange for our royalty certificates, which had a de minimis carrying value.
Previous report
Sales Agreement
Previous report
On August 12, 2024, we entered into a sales agreement (the “Sales Agreement”) with TD Securities (USA) LLC, as agent (“TD Cowen”), pursuant to which we may offer and sell, from time to time through TD Cowen, up to $100 million of shares of Company Common Stock by any method permitted by law and deemed to be an “at the market offering” as defined in Rule 415(a)(4) promulgated under the Securities Act of 1933 (the “Securities Act”). As of December 31, 2024, all of the $100 million of Company Common Stock are available for sale under the Sales Agreement. In connection with the entry into the Sales Agreement, on August 12, 2024, we terminated (the “Termination”) a similar agreement (the “Prior Agreement”) with Jefferies LLC (“Jefferies”) to sell shares of Company Common Stock having an aggregate offering price of up to $100 million, in accordance with its terms and with the mutual agreement of Jefferies. The purpose of the Termination was to eliminate restrictions under certain SEC rules relating to the publication or dissemination of new research reports on the Company’s business by Jefferies in light of its role as sales agent under the Prior Agreement. Prior to the Termination, we sold $15.5 million of shares of Company Common Stock under the Prior Agreement. We cannot make any further sales of the Company Common Stock pursuant to the Prior Agreement.
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2024 LSA
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The Term Loans accrue interest at a floating per annum rate equal to the greater of (i) (x) the ‘prime rate” as reported in The Wall Street Journal plus (y) 2.0%, and (ii) 9.50%. The repayment terms of the Term Loans include monthly payments over a 4-year period, consisting of an initial two-year interest-only period, followed by 24 monthly principal payments plus interest, although the interest-only period can be extended by six months under certain circumstances set forth in the 2024 LSA. At the Company’s option, the Company may prepay all or a portion of the outstanding Term Loans, subject to a prepayment premium equal to (a) 3.0% of the Term Loans being prepaid if the prepayment occurs during the twelve months following the LSA Closing Date, (b) 2.0% of the Term Loans being prepaid if the prepayment occurs after 12 months following the LSA Closing Date but on or prior to 24 months following the LSA Closing Date, and (c) 1.0% of the Term Loans being prepaid if the prepayment occurs after 24 months following the LSA Closing Date and prior to the maturity date. In addition, the Company will pay an end of term charge of 6.35% upon the prepayment or repayment of the Term Loans and a facility charge of 0.75% upon any draws of the Term Loans.
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The 2024 LSA includes customary affirmative and negative covenants and representations and warranties, including a covenant against the occurrence of a “change in control,” financial reporting obligations, and certain limitations on indebtedness, liens, investments, distributions (including dividends), collateral, transfers, mergers or acquisitions, taxes, corporate changes, and bank accounts. The 2024 LSA also includes customary events of default, including payment defaults, breaches of covenants following any applicable cure period, the occurrence of certain events that could reasonably be expected to have a “material adverse effect” as set forth in the 2024 LSA, cross acceleration to third-party indebtedness and certain events relating to bankruptcy or insolvency. Upon the occurrence of an event of default, Hercules may declare all outstanding obligations immediately due and payable and take such other actions as set forth in the 2024 LSA.
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The Company must maintain Qualified Cash (as defined in the 2024 LSA) in an amount greater than or equal to (x) the outstanding principal amount of the Term Loan advances, multiplied by (y) (1) prior to December 1, 2025, 35% or (2) on and after December 1, 2025, (A) if the Performance Milestone Date (as defined in the 2024 LSA) has not occurred on or prior to December 1, 2025, 50% until the date on which the Performance Milestone Date has occurred and (B) on and after the Performance Milestone Date, 35% (the “Minimum Cash Covenant”). The Minimum Cash Covenant will be waived if the Company’s Market Capitalization (as defined in the 2024 LSA) exceeds $500.0 million.
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Exercise of Warrants
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The exercise price of our outstanding warrants, in certain circumstances, may be higher than the prevailing market price of the Company Common Stock and the cash proceeds to us associated with the exercise of our warrants are contingent upon the price of the Company Common Stock. The value of the Company Common Stock may fluctuate and may not exceed the exercise price of the warrants at any given time. As of the date of this Annual Report on Form 10-K, a significant portion of our warrants are “out of the money,” meaning the exercise price is higher than the market price of the Company Common Stock. Holders of such “out of the money” warrants are not likely to exercise such warrants. As a result, we may not receive any proceeds from the exercise of such warrants. There can be no assurance that such warrants will be in the money prior to their respective expiration dates, and therefore, we may not receive any cash proceeds from the exercise of such warrants to fund our operations.
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As a result, we have neither included nor intend to include any potential cash proceeds from the exercise of our warrants in our short-term or long-term liquidity projections. We will continue to evaluate the probability of warrant exercise over the life of our warrants and the merit of including potential cash proceeds from the exercise in our liquidity projections. We do not expect to rely on the exercise of our warrants to fund our operations.
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Reworded paragraphs (41)
Previous wording
and Virtue Sirolimus AngioInfusion Balloon (“Virtue SAB”) for the treatment of artery disease, the leading cause of mortality worldwide. We have an exclusive license and collaboration agreement with Medtronic, Inc. for the development and commercialization of AVIM therapy for the treatment of HTN in patients indicated for a cardiac pacemaker. We are conducting a double-blind, randomized study (“BACKBEAT”) that is expected to enroll a total of 500 patients that have previously been implanted with a Medtronic dual-chamber pacemaker. We currently estimate completion of enrollment of the BACKBEAT study in the first half of 2026; however, there is no assurance that our current operating plan will be achieved. We have a strategic collaboration with Terumo Medical Corporation (“Terumo”) for the development and commercialization of Virtue SAB for the treatment of coronary and peripheral artery disease. We currently expect to receive FDA approval in the first half of 2025 for an amended IDE to conduct a US pivotal study in coronary ISR randomizing Virtue SAB vs. BSC AGENT DCB and are targeting initiation of enrollment of this study in the second half of 2025. We may elect to initiate enrollment regardless of the status or outcome of our negotiations with Terumo.
Current wording
Our flagship product candidates are Atrioventricular Interval Modulation Therapy (“AVIM Therapy”) for the treatment of hypertension (“HTN”), the leading risk factor for death worldwide, and Virtue® Sirolimus AngioInfusion™ Balloon (“Virtue SAB”) for the treatment of atherosclerotic artery disease, the leading cause of mortality worldwide. We have an exclusive license and collaboration agreement with Medtronic Inc. (an affiliate of Medtronic plc) (“Medtronic”) for the development and commercialization of AVIM Therapy for the treatment of uncontrolled HTN in patients indicated for a cardiac pacemaker (as amended, the “Medtronic Agreement”). We are actively conducting a double-blind, randomized, global pivotal study (the “BACKBEAT study”), enrolling up to 500 patients with uncontrolled hypertension who are indicated for a Medtronic dual-chamber pacemaker, with enrollment completion currently planned for mid-2026. We recently initiated patient enrollments in the Virtue SAB in the Treatment of Coronary In-Stent Restenosis (“ISR”) Trial (the “Virtue Trial”) for our U.S. investigational device exemption (“IDE”) pivotal study randomizing Virtue SAB vs. Boston Scientific Corporation’s AGENT™ drug-coated balloon. Designed to support regulatory approval of Virtue SAB, the Virtue Trial is expected to enroll 740 patients in the United States with enrollment completion currently planned for mid-2027. We cannot provide assurance that we will be able to complete enrollment of the BACKBEAT study or the Virtue Trial in the timeframes we anticipate.
Previous wording
Since Legacy Orchestra’s inception, we have devoted the substantial majority of our resources to performing research and development and clinical activities in support of our product development and collaboration efforts. We have funded our operations primarily through the issuance of convertible preferred stock and proceeds from the Business Combination, as well as through proceeds from our distribution agreement with Terumo (the “Terumo Agreement”), borrowings under debt arrangements and, to a lesser extent, from product revenue from our subsidiary, FreeHold Surgical, LLC. (“FreeHold”). Through December 31, 2024, we have raised a cumulative $252.3 million in gross proceeds through the issuance of convertible preferred stock, proceeds from the Business Combination and other equity sales, and have received $30.0 million from the Terumo Agreement. We have incurred net losses each year since inception. Our net losses were $61.0 million and $49.1 million for the years ended December 31, 2024 and 2023, respectively. We expect to continue to incur significant losses for the foreseeable future. As of December 31, 2024, we had an accumulated deficit of $309.9 million.
Current wording
Since Orchestra BioMed, Inc.’s inception, we have devoted the substantial majority of our resources to performing research and development and clinical activities in support of our product development and collaboration efforts. We have funded our operations primarily through the issuance of common stock, convertible preferred stock, and warrants, as well as proceeds from the Business Combination, our prior Terumo Agreement and the Termination and ROFR Agreement, borrowings under debt arrangements, the sale of future revenues, and, to a lesser extent, from product revenue from our subsidiary, FreeHold Surgical, LLC. (“FreeHold”). As of December 31, 2025, we have raised a cumulative $356.5 million in gross proceeds. Future committed cash receipts expected in April 2026 include $20.0 million from the Medtronic Loan Agreement (as such term is defined in Note 16 to the Consolidated Financial Statements –“Debt Financing”), and an additional $15.0 million from Ligand pursuant to the Royalty Purchase Agreement. On January 9, 2026, we received $4.7 million pursuant to the sale of our Vivasure investment. We have incurred net losses each year since inception. Our net losses were $52.7 million and $61.0 million for the years ended December 31, 2025 and 2024, respectively. We expect to continue to incur significant losses for the foreseeable future. As of December 31, 2025, we had an accumulated deficit of $362.6 million.
Previous wording
Legacy Orchestra, our wholly owned subsidiary, was incorporated in Delaware in 2017 and completed a recapitalization and mergers with Caliber Therapeutics, Inc., a Delaware corporation that has, among other things, the rights to the Virtue SAB product candidate and BackBeat Medical, Inc., a Delaware Corporation that has, among other things, the rights to the AVIM therapy candidate, in 2018. Legacy Orchestra completed the conversions of Caliber Therapeutics, Inc. to Caliber Therapeutics, LLC, a Delaware limited liability company, and BackBeat Medical, Inc. to BackBeat Medical, LLC, a Delaware limited liability company, in 2019.
Current wording
Orchestra BioMed, Inc., our wholly owned subsidiary, was incorporated in Delaware in 2017 and completed a recapitalization and mergers with Caliber Therapeutics, Inc., a Delaware corporation that has, among other things, the rights to the Virtue SAB product candidate and BackBeat Medical, Inc., a Delaware Corporation that has, among other things, the rights to the AVIM Therapy product candidate, in 2018. Orchestra BioMed, Inc. completed the conversions of Caliber Therapeutics, Inc. to Caliber Therapeutics, LLC, a Delaware limited liability company, and BackBeat Medical, Inc. to BackBeat Medical, LLC, a Delaware limited liability company, in 2019.
Previous wording
To date, our partnership revenues have related to the Terumo Agreement described below. In future periods, partnership revenues may also include revenues related to the Exclusive License and Collaboration Agreement, dated as of September 30, 2022, by and among, Legacy Orchestra, BackBeat Medical, LLC and Medtronic, Inc. (an affiliate of Medtronic plc) (the “Medtronic Agreement”), discussed in Note 5 to the Consolidated Financial Statements.
Current wording
To date, our partnership revenues have related to the Terumo Agreement described below. In future periods, partnership revenues may also include revenues related to the Exclusive License and Collaboration Agreement, dated as of September 30, 2022, by and among, Orchestra BioMed, Inc., BackBeat Medical, LLC and Medtronic, discussed in Note 4 to the Consolidated Financial Statements.
Previous wording
Legacy Orchestra entered into the Terumo Agreement in June 2019 and has determined that the arrangement represents a contract with a customer and is therefore in scope of ASC 606,Revenues from Contracts with Customers (“ASC 606”). Under the Terumo Agreement, Legacy Orchestra received an upfront payment of $30.0 million in 2019 and an equity commitment of up to $5 million of which $2.5 million was invested in June 2019 as part of the Legacy Orchestra Series B-1 financing and $2.5 million was invested in June 2022 as part of the Legacy Orchestra Series D-2 financing.
Current wording
Orchestra BioMed, Inc. entered into the Terumo Agreement in June 2019 and has determined that the arrangement represents a contract with a customer and is therefore in scope of ASC 606,Revenues from Contracts with Customers (“ASC 606”). Under the Terumo Agreement, Orchestra BioMed, Inc. received an upfront payment of $30.0 million in 2019 and an equity commitment of up to $5.0 million of which $2.5 million was invested in June 2019 as part of the Orchestra BioMed, Inc. Series B-1 financing and $2.5 million was invested in June 2022 as part of the Orchestra BioMed, Inc. Series D-2 financing.
Previous wording
We recorded the $30.0 million upfront payment received in 2019 from Terumo within deferred revenue and are recognizing the upfront payment over time based on a proportional performance model based on the costs incurred to date relative to the total costs expected to be incurred through the completion of the development of the Coronary in ISR indication, for which we are primarily responsible. We have recognized $14.6 million in cumulative partnership revenues from 2019 through December 31, 2024. There were no other proceeds received pursuant to the Terumo Agreement from 2019 through December 31, 2024.
Current wording
We recorded the $30.0 million non-refundable, upfront payment received in 2019 from Terumo within deferred revenue and were recognizing the upfront payment over time based on a proportional performance model based on the costs incurred to date relative to the total costs expected to be incurred through the completion of the development of the Coronary ISR indication, for which we were primarily responsible.
Previous wording
In June 2022, Legacy Orchestra entered into the Medtronic Agreement for the development and commercialization of AVIM therapy for the treatment of pacemaker-indicated patients with uncontrolled HTN despite the use of anti-hypertensive medications. We have determined that the arrangement is a collaboration within the scope of ASC 808,Collaborative Arrangements (“ASC 808”). In addition, we concluded that Medtronic, Inc., an affiliate of Medtronic plc (“Medtronic”), is a customer for a good or service that is a distinct unit of account, and therefore, the transact ions in the Medtronic Agreement should be accounted for under ASC 606. Through December 31, 2024, there have been no amounts recognized as revenue under the Medtronic Agreement.
Current wording
We have determined that the arrangement is a collaboration within the scope of ASC 808,Collaborative Arrangements (“ASC 808”). In addition, we concluded that Medtronic is a customer for a good or service that is a distinct unit of account, and therefore, the transact ions in the Medtronic Agreement, as amended pursuant to the Medtronic Agreement Amendment (the “Amended Medtronic Agreement”), should be accounted for under ASC 606. Through December 31, 2025, there have been no amounts recognized as revenue under the Amended Medtronic Agreement.
Previous wording
Selling, general and administrative expenses consist of personnel-related expenses, including salaries, benefits, bonus, travel and stock-based compensation. Other selling, general and administrative expenses include professional services fees, including legal, audit investor/public relations, and insurance costs, outside consultants costs, employee recruiting and training costs, and non-income taxes. Moreover, we incur and expect to continue to incur additional expenses associated with operating as a public company, including legal, accounting, insurance, exchange listing and U.S. Securities and Exchange Commission (“SEC”) compliance and investor relations. We expect annual selling, general and administrative expenses to continue to increase as we expand our operations as a public company.
Current wording
Selling, general and administrative expenses consist of personnel-related expenses, including salaries, benefits, bonus, travel and stock-based compensation. Other selling, general and administrative expenses include professional services fees, including legal, audit investor/public relations, and insurance costs, outside consultants costs, employee recruiting and training costs, and non-income taxes. Moreover, we incur and expect to continue to incur additional expenses associated with operating as a public company, including legal, accounting, insurance, exchange listing and U.S. Securities and Exchange Commission (“SEC”) compliance, and investor relations expenses. We expect annual selling, general and administrative expenses to continue to increase as we conduct additional clinical trials andexpand our operations as a public company.
Previous wording
Interest income reflects the income generated from marketable securities during the year. Interest expense is attributable to loan interest.
Current wording
Interest (expense) income, net reflects the income generated from marketable securities during the year. Interest expense is attributable to loan interest and interest related to the Royalty Purchase Agreement.
Previous wording
On November 6, 2024(the “LSA Closing Date”), we and certain of our subsidiaries entered into a Loan and Security Agreement (the “2024 LSA”), with Hercules Capital IV, L.P. (“Hercules IV”), Hercules SBIC V, L.P. (“Hercules V”), and Hercules Capital, Inc., as administrative agent and collateral agent (collectively with Hercules IV and Hercules V, “Hercules”). The 2024 LSA provides a secured term loan facility of up to $50.0 million available in up to four tranches (collectively, the “Term Loans”), with the first tranche of $15.0 million drawn on the LSA Closing Date, a second and third tranche of up to an aggregate of $15.0 million available upon achievement of certain performance and financing milestones. Additionally, we may have access to a fourth tranche of $20.0 million subject to future approval. The Term Loan has a maturity date of November 6, 2028 and accrues interest at a floating per annum rate equal to the greater of (i) (x) the “prime rate” as reported inThe Wall Street Journal plus (y) 2.0%, and (ii) 9.50%. Refer to Note 15 to our Consolidated Financial Statements.
Current wording
On November 6, 2024 (the “LSA Closing Date”), we and certain of our subsidiaries (collectively, the “Borrower”) entered into a Loan and Security Agreement, by and among the Borrower, the several banks and other financial institutions or entities party thereto, as lenders (collectively, the “Hercules Lenders”), and Hercules Capital, Inc. (“Hercules”), as administrative agent and collateral agent for itself and the Hercules Lenders, as amended by that certain First Amendment to Loan and Security Agreement dated as of December 30, 2024 ( “2024 LSA”). Prior to July 31, 2025, the 2024 LSA provided a secured term loan facility of up to $50.0 million available in up to four tranches (collectively, the “Term Loans”), with the first tranche of $15.0 million drawn on the LSA Closing Date, and a second and third tranche of up to an aggregate of $15.0 million available upon achievement of certain performance and financing milestones. Additionally, we had access to a fourth tranche of $20.0 million subject to future approval. On July 31, 2025, the Borrower, the Hercules Lenders and Hercules entered into the Second Amendment to the 2024 LSA, which, amended the 2024 LSA to, among other things, (i) delay the initial date upon which we must begin amortizing term loans under the 2024 LSA from (a) December 1, 2026 (with amortization payments delayed to as late December 1, 2027 if certain conditions were met) to (b) July 1, 2027 (with amortization payments delayed to as late as January 1, 2028 if certain conditions are met); (ii) increase by $15.0 million (from $20.0 million to $35.0 million) the amount that that may be borrowed by us in the discretion of the lender’s investment committee’s and (iii) eliminate our ability to draw up to $15.0 million if certain milestones are achieved. The Term Loan has a maturity date of November 6, 2028 and accrues interest at a floating per annum rate equal to the greater of (i) (x) the “prime rate” as reported in The Wall Street Journal plus (y) 2.0%, and (ii) 9.50%. Refer to Note 16 –“Debt Financing” to our Consolidated Financial Statements.
Previous wording
The loss on fair value of strategic investments represents a change in the preferred shares and convertible notes of Vivasure Medical Limited (“Vivasure”), a privately-held company and related party, and fair value of our investment in Motus GI Holdings, Inc. (“Motus GI”), a previously publicly-held company and a former related party. The investments in Vivasure do not have readily determinable fair values and are recorded at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. The shares held of Motus GI represented equity securities with a readily determinable fair value and were required to be measured at fair value at each reporting period using readily determinable pricing available on a securities exchange, in accordance with the provisions of ASU 2016-01. However, in second quarter of 2024, Motus GI announced a resolution to liquidate, at which time we concluded that the fair value should be zero and expensed the remaining carrying value of our investment in Motus GI.
Current wording
The loss on fair value of strategic investments represents a change in the fair value of our investment in common stock holdings of a previously publicly-held company. The common stock held represented equity securities with a readily determinable fair value and were required to be measured at fair value at each reporting period using readily determinable pricing available on a securities exchange, in accordance with the provisions of ASU 2016-01.
Previous wording
Partnership revenue decreased by $101,000, or approximately 5%, to $2.0 million in the year ended December 31, 2024 from $2.1 million for the year ended December 31, 2023. Partnership revenue relates to the recognition of the combined performance obligation for the license granted to Terumo and the ongoing research and development services over the estimated performance period for the Virtue SAB coronary ISR indication, using a proportional performance model, based on the costs incurred relative to the total estimated costs of the research and development services. As of each quarterly reporting date, we evaluate our estimates of the total costs expected to be incurred through the completion of the combined performance obligation and update our estimates as necessary.
Current wording
Partnership revenue increased by $30.9 million, or approximately 1539%, to $32.9 million in the year ended December 31, 2025 from $2.0 million for the year ended December 31, 2024. Partnership revenue relates partially to the recognition of the combined performance obligation for the license granted to Terumo and the ongoing research and development services over the estimated performance period for the Virtue SAB coronary ISR indication, using a proportional performance model, based on the costs incurred relative to the total estimated costs of the research and development services. Partnership revenue primarily relates to our entering into the Termination and ROFR Agreement with Terumo on October 28, 2025, for which we received $30.0 million in exchange for providing a ROFR and issuing Series A Preferred Stock to Terumo. The Termination and ROFR Agreement superseded and terminated the Terumo Agreement, and we no longer have any performance obligations under the Terumo Agreement. In addition to recognizing the remainder of the deferred revenue, partnership revenue for the year ended December 31, 2025 included $10.0 million in consideration for the ROFR and $7.4 million associated with the premium above the fair market value of the Series A Preferred Stock.
Previous wording
For the years ended December 31, 2024 and 2023, the expenses incurred related to the Terumo Agreement were approximately $12.5 million and $15.4 million, respectively. The estimated total costs associated with the Terumo Agreement through completion increased by approximately 5.0% as of December 31, 2024 as compared to the estimates as of December 31, 2023, and increased by approximately 13.6% as of December 31, 2023, as compared to the estimates as of December 31, 2022.
Current wording
Prior to the termination of the Terumo Agreement, as of each quarterly reporting date, we evaluated our estimates of the total costs expected to be incurred through the completion of the combined performance obligation and updated our estimates as necessary. For the year ended December, 31, 2025, the termination of the Terumo Agreement resulted in the conclusion of the related performance obligations and therefore, resulted in the recognition of the remaining deferred revenue. For the year ended December 31, 2024, the expenses incurred related to the Terumo Agreement were $12.5 million. The estimated total costs associated with the Terumo Agreement through completion increased by approximately 5.0% as of December 31, 2024, as compared to the estimates as of December 31, 2023.
Previous wording
Product revenue decreased by $21,000, or approximately 3%, to $633,000 in the year ended December 31, 2024 from $654,000 for the year ended December 31, 2023.
Current wording
Product revenue decreased by $22,000, or approximately 3%, to $611,000 in the year ended December 31, 2025 from $633,000 for the year ended December 31, 2024.
Previous wording
Product revenue consisted of the sale of FreeHold Duo and Trio intracorporeal organ retractors and revenue is recognized when product is shipped to customers. The decrease in product revenue was primarily due to a decrease in the purchase volume of FreeHold Duo and Trio intracorporeal organ retractors. There were no changes to the per unit sale price in either period presented.
Current wording
Product revenue primarily consisted of the sale of FreeHold Duo and Trio intracorporeal organ retractors and revenue is recognized when product is shipped to customers. The decrease in product revenue was due to a decrease in the purchase volume. There were no changes to the per unit sale price in either period between the periods presented.
Previous wording
Cost of product revenue increased by $18,000, or approximately 10%, to $204,000 in the year ended December 31, 2024 from $186,000 for the year ended December 31, 2023. The increase was primarily due to higher production costs per unit of FreeHold Duo and Trio intracorporeal organ retractors.
Current wording
Cost of product revenue decreased by $14,000, or approximately 7%, to $190,000 in the year ended December 31, 2025 from $204,000 for the year ended December 31, 2024. The decrease was primarily due to lower sales volume of FreeHold Duo and Trio intracorporeal organ retractors.
Previous wording
Research and development expenses increased by $9.0 million, or approximately 27%, to $42.8 million for the year ended December 31, 2024 from $33.8 million for the year ended December 31, 2023. This is primarily due to an increase in support of ongoing work to advance the BACKBEAT(BradycArdia paCemaKer with AVIM forBlood prEssure treAtmenT) global pivotal study(“BACKBEAT study”) and to advance Virtue SAB into a planned pivotal study. The increase included an increase of $4.1 million in clinical development costs, an increase of $2.5 million in non-clinical development costs associated with research and development program costs, supplies, and testing, and an increase in personnel-related expenses of $1.5 million due to increased headcount and associated expenses, and an increase in stock-based compensation of $902,000.
Current wording
Research and development expenses increased by $15.4 million, or approximately 36%, to $58.2 million for the year ended December 31, 2025 from $42.8 million for the year ended December 31, 2024. This is primarily due to an increase in support of ongoing work to advance the BACKBEAT study and to advance Virtue SAB into the Virtue Trial, which commenced in October 2025. The increase included an increase of $4.9 million in clinical development costs, an increase in personnel-related expenses of $6.6 million due to increased headcount and consulting costs, an increase of $2.8 million in non-clinical development costs associated with research and development program costs, supplies, and testing, and an increase in stock-based compensation of $1.1 million.
Previous wording
The total research and development expenses summarized above include $12.3 million for the year ended December 31, 2024 and $15.2 million for the year ended December 31, 2023 related to the Terumo Agreement. The decrease of $2.9 million is due to decreased expense activity related to the Terumo Agreement during the 2024 period.
Current wording
The total research and development expenses summarized above include $14.3 million for the year ended December 31, 2025 and $12.3 million for the year ended December 31, 2024 related to the Terumo Agreement. The increase of $2.0 million is due to increased expense activity related to the Terumo Agreement during the 2025 period.
Previous wording
Selling, general and administrative expenses increased by $3.7 million, or approximately 18%, to $23.9 million for the year ended December 31, 2024, from $20.3 million of expense for the year ended December 31, 2023. The increase primarily resulted from an increase in stock-based compensation of $2.1 million, an increase of $1.2 million of accounting, finance, legal, investor relations and public relations expenses incurred in connection with the overall growth of the business and operating as a public company, and an increase in personnel-related expenses of $346,000 due to increased headcount and associated expenses.
Current wording
Selling, general and administrative expenses increased by $3.0 million, or approximately 12%, to $26.9 million for the year ended December 31, 2025, from $23.9 million of expense for the year ended December 31, 2024. The increase primarily resulted from an increase of $1.9 million in accounting, finance, legal, marketing, investor relations and public relations expenses, an increase in personnel-related expenses of $871,000 due to increased headcount and consulting costs, and an increase of $220,000 in stock-based compensation.
Previous wording
Interest income, net, decreased by $493,000, or approximately 13%, to $3.4 million of income for the year ended December 31, 2024 from $3.8 million of income for the year ended December 31, 2023. The net interest income in the 2024 period consisted primarily of interest earned from marketable securities, partially offset by monthly interest expense resulting from the 2024 LSA. The net interest income in the 2023 period consisted primarily of interest earned from marketable securities, partially offset by monthly interest expense incurred resulting from the 2022 Loan and Security Agreement.
Current wording
Interest (expense) income, net, decreased by $4.5 million, or approximately 134%, to $1.1 million of expense for the year ended December 31, 2025 from $3.4 million of income for the year ended December 31, 2024. The net interest expense in the 2025 period consisted primarily of monthly interest expense resulting from the 2024 LSA and the Royalty Purchase Agreement partially offset by interest earned from marketable securities. The net interest income in the 2024 period consisted primarily of interest earned from marketable securities. The decrease in interest (expense) income, net resulted from interest expense related to the Royalty Purchase Agreement, which was not in place during 2024.
Previous wording
The loss on fair value of strategic investments was $68,000 for the year ended December 31, 2024 as compared to a loss of $18,000 for the year ended December 31, 2023. The amounts recognized for the years ended December 31, 2024 and 2023 relate to the change in fair value in our common stock holdings of Motus GI. During the year ended December 31, 2024, Motus GI announced a resolution to liquidate and dissolve, at which time we concluded that the fair value should be zero and expensed the remaining carrying value of our investment in Motus GI.
Current wording
No gain or loss on fair value of strategic investments was recognized for the year ended December 31, 2025 as compared to a loss of $68,000 for the year ended December 31, 2024 related to the change in fair value in our common stock holdings of a previously publicly-held company.
Previous wording
From inception through December 31, 2024, we have incurred significant operating losses and negative cash flows from our operations. Our net losses were $61.0 million and $49.1 million for the years ended December 31, 2024 and December 31, 2023, respectively. As of December 31, 2024, we had an accumulated deficit of $309.9 million. We have funded our operations primarily through the issuance of convertible preferred stock and proceeds from the Business Combination and other equity sales, as well as through proceeds from the Terumo Agreement, borrowings under debt arrangements and, to a lesser extent, from FreeHold product revenue. Through December 31, 2024, we have raised a cumulative $252.3 million in gross proceeds through the issuance of convertible preferred stock, proceeds from the Business Combination and other equity sales, and have received $30.0 million under the Terumo Agreement. We had $22.3 million in cash and cash equivalents at December 31, 2024, which consisted primarily of bank deposits and money market funds. We also had $44.6 million of short-term marketable securities at December 31, 2024, which consisted primarily of our investments in corporate debt securities.
Current wording
From inception through December 31, 2025, we have incurred significant operating losses and negative cash flows from our operations. Our net losses were $52.7 million and $61.0 million for the years ended December 31, 2025 and December 31, 2024, respectively. As of December 31, 2025, we had an accumulated deficit of $362.6 million. We have funded our operations primarily through the issuance of common stock, convertible preferred stock, and warrants, as well as proceeds from the Business Combination, the prior Terumo Agreement and the ROFR and Termination Agreement, borrowings under debt arrangements, the sale of future revenues, and to a lesser extent, revenue from FreeHold products. As of December 31, 2025, we have raised a cumulative total of $356.5 million in gross proceeds. We had $106.5 million in cash and cash equivalents and marketable securities at December 31, 2025, comprised of $34.7 million in cash and cash equivalents and $71.8 million in marketable securities. Cash and cash equivalents consisted primarily of bank deposits and money market funds while short-term marketable securities consisted primarily of our investments in corporate debt securities. Future committed cash receipts expected in April 2026 include $20.0 million from the Medtronic Loan Agreement, and an additional $15.0 million from Ligand pursuant to the Royalty Purchase Agreement. On January 9, 2026, Haemonetics closed on an acquisition of Vivasure in which we can receive up to $10.7 million of proceeds in 2026 made up of approximately $4.7 million upfront and approximately $6.0 million in a first milestone payment.
Previous wording
The amount and timing of our future funding requirements are dependent on many factors, including the cost and pace of execution of clinical studies and research and development activities, the strength of results from clinical studies and other research, development and manufacturing efforts, as well as the potential receipt of revenues or other payments or investments under a restructured Terumo Agreement, the Medtronic Agreement and/or future collaborations, and the realization of cash from the acquisition of Vivasure by Haemonetics. We may also need to seek additional sources of liquidity to meet our funding requirements, including the issuance of new equity, additional drawdowns under the 2024 LSA to the extent we meet the financing and performance requirements to be eligible for such drawdowns, drawdowns on new loan facilities that we may enter into, and/or other financing structures such as the monetization of future royalty streams.
Current wording
Based on internally prepared budget estimates that reflect our operating priorities, we anticipate that our Cash and cash equivalents, Marketable securities, proceeds received subsequent to December 31, 2025 but prior to the filing of this Annual Report on Form 10-K, expected future proceeds from contractual financing commitments and other potential future proceeds described below are sufficient to fund our operations into the fourth quarter of 2027. The amount and timing of our future funding requirements may change from this current estimate and are dependent on many factors, including the cost and pace of execution of clinical studies and research and development activities, the strength of results from clinical studies and other research, development and manufacturing efforts, as well as the receipt of payments under the Royalty Purchase Agreement and the Medtronic Loan Agreement, and receipt of additional expected funds under the terms of the sale of Vivasure to Haemonetics. There are no assurances that any of these factors will be favorable to us, and we may need to seek additional sources of liquidity to meet our funding requirements earlier than current estimates, including the issuance of new equity, and/or other financing structures. In this regard, as of the date of this Annual Report on Form 10-K, we may sell up to $92.4 million of shares of our common stock under the sales agreement we entered into with TD Securities (USA) LLC (the “Sales Agreement”).
Previous wording
As noted above, the sale of Company Common Stock pursuant to the Registration Statement may result in a decline in the value of the Company Common Stock, which may make it more difficult and more dilutive to the existing holders of Company Common Stock to raise funds from the sale of our equity securities.
Current wording
As noted above, the sale of our common stock pursuant to the Resale Registration Statement may result in a decline in the value of our common stock, which may make it more difficult and more dilutive to the existing holders of our common stock to raise funds from the sale of our equity securities.
Previous wording
Net cash used in operating activities for the year ended December 31, 2023 was $46.1 million and primarily consisted of our net loss of $49.1 million and changes in net operating assets and liabilities of $3.3 million, which was partially offset by non-cash charges of $6.3 million. Our non-cash charges primarily consisted of stock-based compensation of $7.6 million and a loss on fair value adjustment of warrant liability of $294,000, partially offset by $3.8 million related to accretion and interest of marketable securities. The net change in operating assets and liabilities was primarily due to a decrease in deferred revenue of $2.1 million, a decrease in operating lease liabilities of $693,000, and an increase in prepaid expenses and other assets of $781,000.
Current wording
Net cash used in operating activities for the year ended December 31, 2025 was $49.0 million and primarily consisted of our net loss of $52.7 million, partially offset by non-cash charges of $14.1 million and changes in net operating assets and liabilities of $10.4 million. Our non-cash charges primarily consisted of stock-based compensation of $12.0 million and $2.0 million in non-cash interest expense in liability related to the Royalty Purchase Agreement. The net change in operating assets and liabilities was primarily due to a decrease in deferred revenue of $15.4 million, partially offset by an increase in accounts payable, accrued expenses, and other liabilities of $4.9 million.
Previous wording
Net cash provided by investing activities for the year ended December 31, 2023 was $10.7 million, which primarily consisted of the sale of $152.8 million of marketable securities, partially offset by the purchase of $142.0 million of marketable securities.
Current wording
Net cash (used in) provided by investing activities for the year ended December 31, 2025 was $26.9 million, which primarily consisted of the purchase of $76.3 million of marketable securities and $489,000 paid for purchases of property and equipment, partially offset by the sale of $49.9 million of marketable securities.
Previous wording
Net cash provided by financing activities of $29.2 million for the year ended December 31, 2024 was primarily attributable to the proceeds of $15.0 million, net of issuance costs, from the at-the-market offering under the Prior Agreement with Jefferies and proceeds from the 2024 LSA with Hercules of $15.0 million. For additional information, seeNote 15 to the Consolidated Financial Statements** – “Debt Financing.”
Current wording
Net cash provided by financing activities of $29.2 million for the year ended December 31, 2024 was primarily attributable to the proceeds of $15.0 million, net of issuance costs, from the at-the-market offering under the Open Market Sale Agreement SM with Jefferies LLC and proceeds from the 2024 LSA with Hercules of $15.0 million. For additional information, see Note 16 to the Consolidated Financial Statements –“Debt Financing.”
Previous wording
Our financial statements are prepared in accordance with U.S. GAAP. The preparation of the financial statements in conformity with U.S. GAAP requires our management to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period. We evaluate our significant estimates on an ongoing basis, including estimates related to the total costs expected to be incurred though the completion of the combined performance obligation of the Terumo Agreement, research and development prepayments, accruals and related expenses and stock-based compensation. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates.
Current wording
Our financial statements are prepared in accordance with U.S. GAAP. The preparation of the financial statements in conformity with U.S. GAAP requires our management to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period. We evaluate our significant estimates on an ongoing basis, including estimates related to the total costs expected to be incurred though the completion of the combined performance obligation of the Terumo Agreement, effective interest expense related to the Royalty Purchase Agreement, research and development prepayments, accruals and related expenses and stock-based compensation. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates.
Previous wording
We believe that the accounting policies described below involve a significant degree of judgment and complexity. Accordingly, we believe these are the most critical to aid in fully understanding and evaluating our financial condition and results of operations. For further information, seeNote 2 to the Consolidated Financial Statements** – “Summary of Significant Accounting Policies.”
Current wording
We believe that the accounting policies described below involve a significant degree of judgment and complexity. Accordingly, we believe these are the most critical to aid in fully understanding and evaluating our financial condition and results of operations. For further information, see Note 2 to the Consolidated Financial Statements –“Summary of Significant Accounting Policies.”
Previous wording
Our revenues are currently comprised of partnership revenues under the Terumo Agreement related to the development and commercialization of Virtue SAB, and product revenue from the sale of FreeHold’s intracorporeal organ retractors.
Current wording
Our revenues have historically been comprised of partnership revenues under the Terumo Agreement related to the development and commercialization of Virtue SAB, and product revenue from the sale of FreeHold’s intracorporeal organ retractors.
Previous wording
To date, our partnership revenues have related to the Terumo Agreement described below. In future periods, partnership revenues may also include revenues related to the Medtronic Agreement, discussed in Note 5 to the
Current wording
To date, our partnership revenues have related to the Terumo Agreement described below. Pursuant to the terms of the Termination and ROFR Agreement, the Terumo Agreement was terminated on October 24, 2025. In future periods, partnership revenues may also include revenues related to the Medtronic Agreement, discussed in Note 4 to the Consolidated Financial Statements.
Previous wording
Legacy Orchestra entered into the Terumo Agreement as further described in Note 4 to the Consolidated Financial Statements. We assessed whether the Terumo Agreement fell within the scope of ASC 808 based on whether the arrangement involved joint operating activities and whether both parties have active participation in the arrangement and are exposed to significant risks and rewards. We determined that the Terumo Agreement did not fall within the scope of ASC 808. We then analyzed the arrangement pursuant to the provisions of ASC 606 and determined that the arrangement represents a contract with a customer and is therefore within the scope of ASC 606.
Current wording
Orchestra BioMed, Inc. entered into the Terumo Agreement as further described in Note 3 to the Consolidated Financial Statements. We assessed whether the Terumo Agreement fell within the scope of ASC 808 based on whether the arrangement involved joint operating activities and whether both parties have active participation in the arrangement and are exposed to significant risks and rewards. We determined that the Terumo Agreement did not fall within the scope of ASC 808. We then analyzed the arrangement pursuant to the provisions of ASC 606 and determined that the arrangement represents a contract with a customer and is therefore within the scope of ASC 606.
Previous wording
The promised goods or services in the Terumo Agreement include (i) license rights to our intellectual property and (ii) research and development services. We also have optional additional items in the Terumo Agreement, which are considered marketing offers and are accounted for as separate contracts with the customer if such option is elected by the customer, unless the option provides a material right which would not be provided without entering into the contract. Performance obligations are promised goods or services in a contract to transfer a distinct good or service to the customer. Promised goods or services are considered distinct when (i) the customer can benefit from the good or service on its own or together with other readily available resources or (ii) the promised good or service is separately identifiable from other promises in the contract. In assessing whether promised goods or services are distinct in the Terumo Agreement, we considered factors such as the stage of development of the underlying intellectual property, the capabilities of the customer to develop the intellectual property on their own or whether the required expertise is readily available.
Current wording
The promised goods or services in the Terumo Agreement included (i) license rights to our intellectual property and (ii) research and development services. Performance obligations are promised goods or services in a contract to transfer a distinct good or service to the customer. Promised goods or services are considered distinct when (i) the customer can benefit from the good or service on its own or together with other readily available resources or (ii) the promised good or service is separately identifiable from other promises in the contract. In assessing whether promised goods or services are distinct in the Terumo Agreement, we considered factors such as the stage of development of the underlying intellectual property, the capabilities of the customer to develop the intellectual property on their own or whether the required expertise is readily available.
Previous wording
We estimate the transaction price for the Terumo Agreement performance obligations based on the amount expected to be received for transferring the promised goods or services pursuant to the Terumo Agreement. The consideration includes both fixed consideration and variable consideration. At the inception of the Terumo Agreement, as well as at each reporting period, we evaluate the amount of potential payment and the likelihood that the payments will be received. We utilize either the most likely amount method or expected amount method to estimate the amount expected to be received based on which method better predicts the amount expected to be received. If it is probable that a significant revenue reversal would not occur, the variable consideration is included in the transaction price.
Current wording
We estimated the transaction price for the Terumo Agreement performance obligations based on the amount expected to be received for transferring the promised goods or services pursuant to the Terumo Agreement. The consideration included both fixed consideration and variable consideration. At the inception of the Terumo Agreement, as well as at each reporting period, we evaluated the amount of potential payment and the likelihood that the payments would be received. We utilized either the most likely amount method or expected amount method to estimate the amount expected to be received based on which method better predicts the amount expected to be received. If it was probable that a significant revenue reversal would not occur, the variable consideration was included in the transaction price.
Previous wording
The Terumo Agreement contains development and regulatory milestone payments. At contract inception and at each reporting period, we evaluate whether the milestones are considered probable of being reached and estimate the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. At the end of each subsequent reporting period, we re-evaluate the probability of achievement of such development milestones and any related constraint, and if necessary, adjust our estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect partnership revenues and earnings in the period of adjustment.
Current wording
The Terumo Agreement had contained development and regulatory milestone payments. At contract inception and at each reporting period, we evaluated whether the milestones were considered probable of being reached and estimated the amount to be included in the transaction price using the most likely amount method. If it was probable that a significant revenue reversal would not occur, the associated milestone value was included in the transaction price. At the end of each subsequent reporting period, we re-evaluated the probability of achievement of such development milestones and any related constraint, and if necessary, adjusted our estimate of the overall transaction price. Any such adjustments were recorded on a cumulative catch-up basis, which affected partnership revenues and earnings in the period of adjustment.
Previous wording
We have determined that intellectual property licensed to Terumo and the research and development services to be provided to support the premarket approval by the FDA for the ISR indication represent a combined performance obligation that is satisfied over time, which is currently estimated to be completed in 2029, and that the appropriate method of measuring progress for purposes of recognizing revenues relates to a proportional performance model that measures the proportional performance based on the costs incurred to date relative to the total costs expected to be incurred through the completion of the performance obligation. We evaluate the measure of progress at each reporting period and, if necessary, adjust the measure of performance and related revenue recognition.
Current wording
We had determined that intellectual property that was licensed to Terumo and the research and development services to be provided to support the premarket approval by the FDA for the ISR indication represented a combined performance obligation that was satisfied over time and that the appropriate method of measuring progress for purposes of recognizing revenues relates to a proportional performance model that measures the proportional performance based on the costs incurred to date relative to the total costs expected to be incurred through the completion of the performance obligation. We had evaluated the measure of progress at each reporting period and, if necessary, adjusted the measure of performance and related revenue recognition.
Previous wording
We receive payments from Terumo based on billing schedules established in the contract. Such billings for milestone related events have 10-day terms from the date the milestone is achieved, royalty payments are 20-day terms after the close of each quarter, any optional services are 20 days after receipt of an invoice and sales of SirolimusEFR are within 30 days after receipt of the shipping invoices. Upfront payments are recorded as deferred revenue upon receipt or when due until we perform our obligations under these arrangements. Amounts are recorded as accounts receivable when the right to consideration is unconditional.
Current wording
We had received payments from Terumo based on billing schedules established in the contract. Such billings for milestone related events had 10-day terms from the date the milestone was achieved, royalty payments were 20-day terms after the close of each quarter, any optional services were 20 days after receipt of an invoice and sales of SirolimusEFR were within 30 days after receipt of the shipping invoices. Upfront payments were recorded as deferred revenue upon receipt or when due until we perform our obligations under these arrangements. Amounts were recorded as accounts receivable when the right to consideration was unconditional.
Previous wording
In June 2022, Legacy Orchestra, BackBeat Medical, LLC and Medtronic entered into the Medtronic Agreement for the development and commercialization of AVIM therapy for the treatment of pacemaker-indicated patients with uncontrolled HTN despite the use of anti-hypertensive medications. We determined that the arrangement is a collaboration within the scope of ASC 808. In addition, we concluded Medtronic is a customer for a good or service that is a distinct unit of account, and therefore the transactions in the Medtronic Agreement should be accounted for under ASC 606. Through December 31, 2024, there have been no amounts recognized as revenue under the Medtronic Agreement.
Current wording
In June 2022, Orchestra BioMed Inc., BackBeat Medical, LLC and Medtronic entered into the Medtronic Agreement for the development and commercialization of AVIM Therapy for the treatment of pacemaker-indicated patients with uncontrolled HTN despite the use of anti-hypertensive medications. We determined that the arrangement is a collaboration within the scope of ASC 808. In addition, we concluded Medtronic is a customer for a good or service that is a distinct unit of account, and therefore the transactions in the Medtronic Agreement should be accounted for under ASC 606. Through December 31, 2025, there have been no amounts recognized as revenue under the Medtronic Agreement.
Previous wording
We account for share-based payments at fair value. The fair value of stock options is measured using the Black-Scholes option-pricing model and the fair value of restricted stock is measured based on the fair value of the Company Common Stock underlying the award as of the grant date, described further below. For share-based awards that vest subject to the satisfaction of a service requirement, the fair value measurement date for stock-based compensation awards is the date of grant and the expense is recognized on a straight-line basis, over the vesting period. We account for forfeitures as they occur.
Current wording
We account for share-based payments at fair value. The fair value of stock options is measured using the Black-Scholes option-pricing model and the fair value of restricted stock is measured based on the fair value of our common stock underlying the award as of the grant date, described further below. For share-based awards that vest subject to the satisfaction of a service requirement, the fair value measurement date for stock-based compensation awards is the date of grant and the expense is recognized on a straight-line basis, over the vesting period. We account for forfeitures as they occur.
Previous wording
During the years ended December 31, 2024 and 2023, stock-based compensation was $10.6 million and $7.6 million, respectively. As of December 31, 2024, we had approximately $17.8 million of total unrecognized stock-based compensation, which we expect to recognize over a weighted-average period of approximately 2.3 years.
Current wording
During the years ended December 31, 2025 and 2024, stock-based compensation was $12.0 million and $10.6 million, respectively. As of December 31, 2025, we had approximately $13.3 million of total unrecognized stock-based compensation, which we expect to recognize over a weighted-average period ofapproximately 2.3 years.
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Previous report — wording carried elsewhere
On November 6, 2024, the Company and certain of its subsidiaries entered into the 2024 LSA. The 2024 LSA provides a secured term loan facility of up to $50.0 million available in up to four tranches (collectively, the “Term Loans”), with the first tranche of $15.0 million drawn on the LSA Closing Date, a second and third tranche of up to an aggregate of $15.0 million available upon achievement of certain performance and financing milestones. Additionally, the Company may have access to a fourth tranche of $20.0 million subject to future approval.