BIODESIX INC

Previous wording

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2024 (Form 10-K) and the Condensed Financial Statements as of June 30, 2025 and for the three and six months ended June 30, 2025 and 2024, included in Part I, Item 1 of this Form 10-Q, which provide additional information regarding our financial position, results of operations and cash flows. To the extent that the following MD&A contains statements which are not of a historical nature, such statements are forward-looking statements, which involve risks and uncertainties, including but not limited to those set forth under the caption “Special Note Regarding Forward-Looking Statements” and Item 1A. “Risk Factors” of Part II in this Quarterly Report on Form 10-Q and those discussed in our other filings with the Securities and Exchange Commission (SEC), including the risks described in Item 1A. “Risk Factors” of Part I of our Annual Report on Form 10-K for the year ended December 31, 2024, which was filed on March 3, 2025.

Current wording

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2024 (Form 10-K) and the Condensed Financial Statements as of September 30, 2025 and for the three and nine months ended September 30, 2025 and 2024, included in Part I, Item 1 of this Form 10-Q, which provide additional information regarding our financial position, results of operations and cash flows. To the extent that the following MD&A contains statements which are not of a historical nature, such statements are forward-looking statements, which involve risks and uncertainties, including but not limited to those set forth under the caption “Special Note Regarding Forward-Looking Statements” and Item 1A. “Risk Factors” of Part II in this Quarterly Report on Form 10-Q and those discussed in our other filings with the Securities and Exchange Commission (SEC), including the risks described in Item 1A. “Risk Factors” of Part I of our Annual Report on Form 10-K for the year ended December 31, 2024, which was filed on March 3, 2025.

Previous wording

The following MD&A discussion is provided to supplement the Condensed Financial Statements as of June 30, 2025 and 2024 and for the three and six months then ended included in Part I, Item 1 of this Quarterly Report on Form 10-Q. We intend for this discussion to provide you with information that will assist you in understanding our financial statements, the changes in key items in those financial statements from period to period, and the primary factors that accounted for those changes.

Current wording

The following MD&A discussion is provided to supplement the Condensed Financial Statements as of September 30, 2025 and 2024 and for the three and nine months then ended included in Part I, Item 1 of this Quarterly Report on Form 10-Q. We intend for this discussion to provide you with information that will assist you in understanding our financial statements, the changes in key items in those financial statements from period to period, and the primary factors that accounted for those changes.

Previous wording

Data for the three and six months ended June 30, 2025 and 2024 has been derived from our unaudited condensed financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Current wording

Data for the three and nine months ended September 30, 2025 and 2024 has been derived from our unaudited condensed financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Previous wording

Our clinical research has resulted in approximately 90 peer-reviewed publications for our tests. In addition to clinical studies, we are collaborating with investigators from multiple academic cancer centers. On June 3, 2022, we announced the intent to develop a new novel molecular minimal residual disease (MRD) test as a part of a master sponsored research agreement (MSRA) with Memorial Sloan Kettering Cancer Center (MSK). In addition, the MSRA between MSK and the Company also includes the potential future development of other diagnostic tests aimed at improving the treatment of cancer. On March 25, 2024, we announced a new master collaborative research agreement (MCRA) with MSK under which the teams will collaborate on a development plan for diagnostic tests aimed at improving the treatment of cancer. Biodesix will utilize its array of genomics, proteomics, and data mining capabilities with the aim of developing and commercializing oncology biomarker assays in collaboration with MSK. Bio-Rad will provide its industry-leading digital PCR assay technology in support of this important work. We believe these studies and collaborative arrangements are critical to gaining physician adoption and driving favorable coverage decisions by payers and expect our investments in research and development to increase. Further we also expect to increase our research and development expenses to fund further innovation and develop new clinically relevant tests.

Current wording

Our clinical research has resulted in over 90 peer-reviewed publications for our tests. In addition to clinical studies, we are collaborating with investigators from multiple academic cancer centers. On June 3, 2022, we announced the intent to develop a new novel molecular minimal residual disease (MRD) test as a part of a master sponsored research agreement (MSRA) with Memorial Sloan Kettering Cancer Center (MSK). In addition, the MSRA between MSK and the Company also includes the potential future development of other diagnostic tests aimed at improving the treatment of cancer. On March 25, 2024, we announced a new master collaborative research agreement (MCRA) with MSK under which the teams will collaborate on a development plan for diagnostic tests aimed at improving the treatment of cancer. Biodesix will utilize its array of genomics, proteomics, and data mining capabilities with the aim of developing and commercializing oncology biomarker assays in collaboration with MSK. Bio-Rad will provide its industry-leading digital PCR assay technology in support of this important work. We believe these studies and collaborative arrangements are critical to gaining physician adoption and driving favorable coverage decisions by payers and expect our investments in research and development to increase. Further we also expect to increase our research and development expenses to fund further innovation and develop new clinically relevant tests.

Previous wording

Ability to attract new biopharmaceutical customers and maintain and expand relationships with existing customers. Our business development team promotes the broad utility of our products for biopharmaceutical companies in the United States and internationally. Our revenue, business opportunities and growth depend in part on our ability to attract new biopharmaceutical customers and to maintain and expand relationships with existing biopharmaceutical customers. We expect to increase our sales and marketing expenses in furtherance of this as we continue to develop these relationships, and we expect to support a growing number of investigations and clinical trials. If our relationships expand, we believe we may have opportunities to offer our platform for companion diagnostic development, novel target discovery and validation efforts, and to grow into other commercial opportunities. For example, we believe our multi-omic data including genomic and proteomic data, in combination with clinical outcomes or claims data, has revenue-generating potential, including for novel target identification and companion diagnostic discovery and development.

Current wording

Ability to attract new Development Services including biopharmaceutical customers and maintain and expand relationships with existing customers. Our business development team promotes the broad utility of our products for biopharmaceutical companies in the United States and internationally. Our revenue, business opportunities and growth depend in part on our ability to attract new Development Services including biopharmaceutical customers and to maintain and expand relationships with existing biopharmaceutical customers. We expect to increase our sales and marketing expenses in furtherance of this as we continue to develop these relationships, and we expect to support a growing number of investigations and clinical trials. If our relationships expand, we believe we may have opportunities to offer our platform for companion diagnostic development, novel target discovery and validation efforts, and to grow into other commercial opportunities. For example, we believe our multi-omic data including genomic and proteomic data, in combination with clinical outcomes or claims data, has revenue-generating potential, including for novel target identification and companion diagnostic discovery and development.

Previous wording

Second Quarter 2025 Financial and Operational Highlights

Current wording

Third Quarter 2025 Financial and Operational Highlights

Previous wording

Gross margin was $16.0 million, or 80% for the second quarter 2025, a 150-basis point improvement over the prior year comparable period, continuing to be driven by growth in Lung Diagnostic testing and optimization of testing workflows that resulted in improvements in costs per test, and the ongoing expansion of our Development Services business;

Current wording

Gross margin was $17.7 million, or 81% for the third quarter 2025, a 400-basis point improvement over the prior year comparable period, driven by growth in Lung Diagnostic testing, improvements in average revenue per test, and optimization of testing workflows that resulted in improvements in costs per test;

Previous wording

Operating expenses (excluding direct costs and expenses) of $25.7 million for the second quarter 2025, an increase of 15% over the respective prior year comparable period;

Current wording

Operating expenses (excluding direct costs and expenses) of $24.7 million for the third quarter 2025, an increase of 10% over the prior year comparable period;

Previous wording

Includes non-cash stock compensation expense of $1.0 million during the second quarter 2025, a decrease of 15% over the respective prior year comparable period.

Current wording

Includes non-cash stock compensation expense of $1.1 million during the third quarter 2025, a decrease of 30% over the prior year comparable period;

Previous wording

Cash and cash equivalents of $20.7 million as of June 30, 2025, an increase of $3.1 million from the period ending March 31, 2025.

Current wording

Cash and cash equivalents of $16.6 million as of September 30, 2025, a decrease of $4.1 million from the period ending June 30, 2025. Change in cash included $4.8 million in net proceeds from the Company’s at-the-market offering, partially offset by unfavorable changes in working capital, primarily driven by a $5.2 million increase in accounts receivable. The increase in accounts receivable reflects higher Lung Diagnostic Testing revenue, newly secured Development Services agreements, and the timing of cash receipts, which were collected during the fourth quarter.

Previous wording

Cost of diagnostic testing generally consists of cost of materials, direct labor, including bonuses, employee benefits, share-based compensation, equipment and infrastructure expenses associated with acquiring and processing test samples, including sample accessioning, test performance, quality control analyses, charges to collect and transport samples; curation of test results for physicians; and in some cases, license or royalty fees due to third parties. Costs associated with performing our tests are recorded as the tests are processed regardless of whether revenue was recognized with respect to the tests. Infrastructure expenses include allocated depreciation of laboratory equipment, rent costs, amortization of leasehold improvements and information technology costs. Royalties for licensed technology are calculated as a percentage of revenues generated using the associated technology and recorded as expense at the time the related revenue is recognized. One-time royalty payments related to signing of license agreements or other milestones, such as issuance of new patents, are amortized to expense over the expected useful life of the patents. While we do not believe the technologies underlying these licenses are necessary to permit us to provide our tests, we do believe these technologies are potentially valuable and of possible strategic importance to us or our competitors. Under these license agreements, we are obligated to pay aggregate royalties ranging from

Current wording

Cost of diagnostic testing generally consists of cost of materials, direct labor, including bonuses, employee benefits, share-based compensation, equipment and infrastructure expenses associated with acquiring and processing test samples, including sample accessioning, test performance, quality control analyses, charges to collect and transport samples; curation of test results for physicians; and in some cases, license or royalty fees due to third parties. Costs associated with performing our tests are recorded as the tests are processed regardless of whether revenue was recognized with respect to the tests. Infrastructure expenses include allocated depreciation of laboratory equipment, rent costs, amortization of leasehold improvements and information technology costs. Royalties for licensed technology are calculated as a percentage of revenues generated using the associated technology and recorded as expense at the time the related revenue is recognized. One-time royalty payments related to signing of license agreements or other milestones, such as issuance of new patents, are amortized to expense over the expected useful life of the patents. While we do not believe the technologies underlying these licenses are necessary to permit us to provide our tests, we do believe these technologies are potentially valuable and of possible strategic importance to us or our competitors. Under these license agreements, we are obligated to pay aggregate royalties ranging from 1% to 8% of sales in which the patents or know-how are used in the product or service sold, sometimes subject to minimum annual royalties or fees in certain agreements.

Previous wording

For the three and six months ended June 30, 2025 interest expense primarily consists of cash and non-cash interest from the Perceptive Term Loan Facility. For the three and six months ended June 30, 2024, interest expense consists of cash and non-cash interest from the Perceptive Term Loan Facility, contingent consideration, and changes in the fair value of our contingent consideration associated with the passage of time subsequent to the achievement of the gross margin target in the second quarter 2021. Interest income, which is included in ‘Other income, net’ in the statements of operations consists of income earned on our cash and cash equivalents.

Current wording

For the three and nine months ended September 30, 2025 interest expense primarily consists of cash and non-cash interest from the Perceptive Term Loan Facility. For the three and nine months ended September 30, 2024, interest expense consists of cash and non-cash interest from the Perceptive Term Loan Facility and changes in the value of our contingent consideration associated with the passage of time subsequent to the achievement of the gross margin target in the second quarter 2021. Interest income, which is included in ‘Other income, net’ in the condensed statements of operations consists of income earned on our cash and cash equivalents.

Previous wording

Diagnostic Tests revenue increased $1.4 million or 8% and $3.9 million or 13% for the three and six months ended June 30, 2025, respectively, compared to the same periods in 2024. The increases are primarily due to an increase of $1.9 million and $4.5 million, respectively, in the Nodify Lung Nodule Risk Assessment testing strategy driven by an increase in tests delivered as our sales efforts continue to focus on Nodify CDT and XL2 tests. These increases were partially offset by $0.5 million and $0.7 million decreases, respectively, in the IQLung testing strategy sales.

Current wording

Diagnostic Tests revenue increased $2.7 million or 16%, and $6.5 million or 14%, for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024. The increases are primarily due to an increase of $3.2 million and $7.7 million, respectively, in the Nodify Lung Nodule Risk Assessment testing strategy driven by increases in tests delivered and improvements in average revenue per test as our sales efforts continue to focus on Nodify CDT and XL2 tests. These increases were partially offset by $0.5 million and $1.2 million decreases, respectively, in the IQLung testing strategy sales.

Previous wording

Development Services revenue increased $0.7 million or 53% and $1.4 million or 56% for the three and six months ended June 30, 2025, respectively, compared to the same periods in 2024. The increase in revenue was primarily a result of delivering against our expanding book of business and securing new agreements.

Current wording

Development Services revenue increased $1.0 million or 97%, and $2.3 million or 68%, for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024. The increase in revenue was primarily a result of delivering against our expanding book of business and securing new agreements.

Previous wording

Direct costs and expenses related to revenue increased $0.2 million or 4% and $0.7 million or 10% for the three and six months ended June 30, 2025, respectively, compared to the same periods in 2024, primarily driven by the increase in testing volume compared to the same periods in 2024, partially offset by the optimization of testing workflows that resulted in improvements in costs per test.

Current wording

Direct costs and expenses related to revenue decreased $0.1 million or 2%, and increased $0.6 million or 5%, for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024. Although testing volumes increased, the decrease in expenses for the three months ended September 30, 2025 is primarily driven by the optimization of testing workflows that resulted in improvements in costs per test. The increase for the nine months ended September 30, 2025 is primarily due to the increase in testing volume, partially offset by improvements in costs per test, compared to the same period in 2024.

Previous wording

Research and development expenses increased $0.7 million or 28% and $1.5 million or 34% for the three and six months ended June 30, 2025, respectively, compared to the same periods in 2024. The increase in costs was primarily due to an increase in internal expenses associated with employee compensation and benefit costs resulting from an increase in headcount and variable compensation as well as an increase in external costs associated with clinical trials.

Current wording

Research and development expenses increased $0.4 million or 17%, and $2.0 million or 28%, for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024. The increase in costs was primarily due to an increase in internal expenses associated with employee compensation and benefit costs resulting from an increase in headcount and variable compensation as well as an increase in external costs associated with clinical trials.

Previous wording

The following table summarizes our external and internal costs for the three and six months ended June 30, 2025 and 2024 (in thousands, except percentages):

Current wording

The following table summarizes our external and internal costs for the three and nine months ended September 30, 2025 and 2024 (in thousands, except percentages):

Previous wording

Sales, marketing, general and administrative expenses increased $2.8 million or 14% and $2.6 million or 7% for the three and six months ended June 30, 2025, respectively, compared to the same periods in 2024. The increase in costs was primarily due to an increase in internal expenses associated with employee compensation and benefit costs resulting from an increase in headcount and variable compensation offset by a decrease in external costs associated with contracted services and sales and marketing educational and event expenses.

Current wording

Sales, marketing, general and administrative expenses increased $1.7 million or 8%, and $4.3 million or 7%, for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024. The increase in costs was primarily due to an increase in internal expenses associated with employee compensation and benefit costs resulting from an increase in headcount and variable compensation offset by a decrease in external costs associated with contracted services and sales and marketing educational and event expenses.

Previous wording

Interest expense decreased an insignificant amount and $0.9 million or 20% for the three and six months ended June 30, 2025, respectively, compared to the same periods in 2024. The interest expense for the six months ended June 30, 2025 is primarily related to interest and amortization of debt issuance costs associated with the Perceptive Term Loan Facility of $3.5 million. The interest expense for the six months ended June 30, 2024 is primarily related to interest and amortization of debt issuance costs associated with the Perceptive Term Loan Facility of $3.5 million and interest associated with the contingent consideration of $0.9 million, which was paid in full on September 30, 2024.

Current wording

Interest expense increased an insignificant amount and decreased $0.8 million or 13%, for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024. The interest expense for the nine months ended September 30, 2025 is primarily related to interest and amortization of debt issuance costs associated with the Perceptive Term Loan Facility of $5.5 million. The interest expense for the nine months ended September 30, 2024 is primarily related to interest and amortization of debt issuance costs associated with the Perceptive Term Loan Facility of $5.3 million and interest associated with the contingent consideration of $1.1 million, which was paid in full on September 30, 2024.

Previous wording

Loss on extinguishment of liabilities decreased $0.2 million or 100% for both the three and six months ended June 30, 2025, respectively, compared to the same periods in 2024. On April 22, 2024, the Company obtained consent from Perceptive and prepaid the July 1, 2024 contingent consideration Milestone Payment of $8.4 million to Indi. As a result of prepaying the Milestone Payment, the Company performed a fair value analysis through April 22, 2024 and recorded a loss on early extinguishment of $0.2 million.

Current wording

Loss on extinguishment of liabilities decreased $0.2 million or 100% for the nine months ended September 30, 2025, compared to the same period in 2024. On April 22, 2024, the Company obtained consent from Perceptive and prepaid the July 1, 2024 contingent consideration Milestone Payment of $8.4 million to Indi. As a result of prepaying the Milestone Payment, the Company performed a fair value analysis through April 22, 2024 and recorded a loss on early extinguishment of $0.2 million.

Previous wording

On February 28, 2025, the Company entered into the Fifth Amendment to the Credit Agreement with Perceptive, whereby subject to the terms and conditions of the Fifth Amendment, the Tranche C Loan Commitment Termination Date was extended, providing continued availability to the Tranche C Loan through December 31, 2025. In addition, on the Tranche C Loan borrowing date, the Tranche C Warrants, as amended, would become vested and exercisable at an exercise price equal to $0.793, the Company's closing stock price on February 28, 2025. On May 8, 2025, the Company exercised its ability to draw the Tranche C loan under the Perceptive Term Loan Facility for $10.0 million. As consideration for drawing the Tranche C Loan, the Company agreed to modify the previously agreed upon per share exercise price of $0.793 for the Tranche C Warrants to a new per share exercise of $0.4191, which was equal to the 10-day VWAP of the Company’s common stock on May 9, 2025, the business day immediately preceding the Tranche C Loan borrowing date. In connection with the Tranche C draw, the Company remeasured the Tranche C Warrants through the Tranche C borrowing date and recorded the change in fair value through the statement of operations and, subsequently, reclassified the fair value to additional paid-in capital.

Current wording

On February 28, 2025, the Company entered into the Fifth Amendment to the Credit Agreement with Perceptive, whereby subject to the terms and conditions of the Fifth Amendment, the Tranche C Loan Commitment Termination Date was extended, providing continued availability to the Tranche C Loan through December 31, 2025. In addition, on the Tranche C Loan borrowing date, the Tranche C Warrants, as amended, would become vested and exercisable at an exercise price equal to $15.86, the Company's closing stock price on February 28, 2025. On May 8, 2025, the Company exercised its ability to draw the Tranche C loan under the Perceptive Term Loan Facility for $10.0 million. As consideration for drawing the Tranche C Loan, the Company agreed to modify the previously agreed upon per share exercise price of $15.86 for the Tranche C Warrants to a new per share exercise of $8.382, which was equal to the 10-day VWAP of the Company’s common stock on May 9, 2025, the business day immediately preceding the Tranche C Loan borrowing date. In connection with the Tranche C draw, the Company remeasured the Tranche C Warrants through the Tranche C borrowing date and recorded the change in fair value through the statement of operations and, subsequently, reclassified the fair value to additional paid-in capital.

Previous wording

During the three and six months ended June 30, 2025, the Company recorded a gain of $0.1 million and a loss of $0.3 million, respectively, as a change in fair value of warrant liability through the condensed statements of operations.

Current wording

During the three and nine months ended September 30, 2025, the Company recorded no change and a loss of $0.3 million, respectively, as a change in fair value of warrant liability through the condensed statements of operations.

Previous wording

During the three and six months ended June 30, 2025, the Company recorded other income, net of $0.1 million and $0.2 million, respectively, primarily related to interest income. During the three and six months ended June 30, 2024, the Company recorded other expense, net of $0.4 million and $0.5 million, respectively. The expense primarily consists of deferred offering costs of approximately $0.6 million and $0.7 million, respectively, as a result of changes in the probability of our ability to fully utilize the LPC Facility prior to the termination date. Partially offsetting this expense during the three and six months ended June 30, 2024 is $0.3 million of interest and other income.

Current wording

During the three and nine months ended September 30, 2025, the Company recorded other income, net of $0.4 million and $0.6 million, respectively, primarily related to interest and other income. During the three and nine months ended September 30, 2024, the Company recorded other income, net of $0.4 million and other expense, net of $0.1 million, respectively. The other income, net for the three months ended September 30, 2024 was comprised primarily of interest income. The other expense, net for the nine months ended September 30, 2024 primarily consisted of deferred offering costs of approximately $0.7 million as a result of changes in the probability of our ability to fully utilize the LPC Facility prior to the termination date, offset by $0.6 million of interest and other income.

Previous wording

On November 21, 2022, the Company entered into a Credit Agreement and Guaranty (the Credit Agreement) with Perceptive Credit Holdings IV, LP (Perceptive) as lender and administrative agent (the Lender) for up to $50.0 million, with funding of $30.0 million and the issuance of warrants exercisable into 3,000,000 shares of the Company’s common stock occurring on November 21, 2022, and two additional contingently issuable tranches of $10.0 million each subject to certain terms and conditions, including revenue milestones. During the three months ended December 31, 2023, the Company met the conditions precedent associated with the Tranche B Loan and, on December 15, 2023, the Company exercised its ability to draw the Tranche B loan for $10.0 million (the Tranche B Loan). The Tranche C loan had a prior commitment date through September 30, 2024 and, as of that date, the Company did not exercise its ability to draw the Tranche C loan (see below for further details related to the Fifth Amendment).

Current wording

During the three months ended December 31, 2023, the Company met the conditions precedent associated with the Tranche B Loan and, on December 15, 2023, the Company exercised its ability to draw the Tranche B loan for $10.0 million (the Tranche B Loan). The Tranche C loan had a prior commitment date through September 30, 2024 and, as of that date, the Company did not exercise its ability to draw the Tranche C loan (see below for further details related to the Fifth Amendment).

Previous wording

On November 1, 2024, the Company filed a shelf registration statement on Form S-3 and entered into a new sales agreement with a financial institution, pursuant to which the Company may issue and sell, from time to time, shares of its common stock having an aggregate offering price of up to $50.0 million, subject to terms and conditions (the 2024 ATM Program). The shares of common stock offered pursuant to the 2024 ATM Program will be offered and sold by the Company pursuant to its registration statement on Form S-3 which became effective with the SEC on November 12, 2024. Sales of common stock under the 2024 ATM Program, if any, will be made at market prices by methods deemed to be an “at-the-market offering” as defined in Rule 415 promulgated under the Securities Act of 1933, as amended, including sales made directly on the NASDAQ Global Market, or any other existing trading market for our common stock. In connection with establishing the 2024 ATM Program, the Company terminated its prior $50.0 million ATM program established in November 2021, and no additional stock can be issued thereunder. As of June 30, 2025, the Company had remaining available capacity for share issuances of up to $50.0 million under the 2024 ATM Program.

Current wording

On November 1, 2024, the Company filed a shelf registration statement on Form S-3 and entered into a new sales agreement with a financial institution, pursuant to which the Company may issue and sell, from time to time, shares of its common stock having an aggregate offering price of up to $50.0 million, subject to terms and conditions (the 2024 ATM Program). The shares of common stock offered pursuant to the 2024 ATM Program will be offered and sold by the Company pursuant to its registration statement on Form S-3 which became effective with the SEC on November 12, 2024. Sales of common stock under the 2024 ATM Program, if any, will be made at market prices by methods deemed to be an “at-the-market offering” as defined in Rule 415 promulgated under the Securities Act of 1933, as amended, including sales made directly on the NASDAQ Global Market, or any other existing trading market for our common stock. In connection with establishing the 2024 ATM Program, the Company terminated its prior $50.0 million ATM program established in November 2021, and no additional stock can be issued thereunder. During the three and nine months ended September 30, 2025, the Company raised approximately $5.0 million ($4.8 million after deducting underwriting discounts and commissions and offering expenses payable), in gross proceeds from the sale of 596,532 common shares at a weighted average price per share of $8.38. As of September 30, 2025, the Company had remaining available capacity for share issuances of up to $45.0 million under the 2024 ATM Program.

Previous wording

On March 24, 2025, the Company received written notice from the Listing Qualifications Staff (the Staff) of The Nasdaq Stock Market LLC (Nasdaq) notifying the Company that, for the last 30 consecutive business days, the closing bid price for the Company’s common stock had closed below the minimum $1.00 per share required for continued listing on The Nasdaq Global Market pursuant to Nasdaq Listing Rule 5450(a)(1) (the Minimum Bid Price Requirement). In accordance with Nasdaq rules, the Company has been provided an initial period of 180 calendar days, or until September 22, 2025 (the Compliance Date), to regain compliance with the Minimum Bid Price Requirement. If, at any time before the Compliance Date, the closing bid price for the Company’s common stock is at least $1.00 for a minimum of ten consecutive business days, the Staff will provide the Company written confirmation of compliance with the Minimum Bid Price Requirement and close the matter. The Company may be eligible for an additional 180 calendar day compliance period. The Company intends to monitor the closing bid price of its common stock and will consider various options available to it if its common stock does not trade at a level to regain compliance with the Minimum Bid Price Requirement. These options include effecting a reverse stock split designed to increase the bid price of the Company’s common stock in an amount sufficient to regain compliance with the Minimum Bid Price Requirement.

Current wording

On March 24, 2025, the Company received written notice from the Listing Qualifications Staff (the Staff) of Nasdaq notifying the Company that it no longer complied with the minimum bid price requirement for continued listing on The Nasdaq Global Market. On September 15, 2025, the Company effected a 1-for-20 reverse stock split and on September 26, 2025, the Company received a letter from the Staff notifying the Company that it had regained compliance with the minimum bid price requirement for continued listing on The Nasdaq Global Market, and the matter is now closed.

Previous wording

Our cash flows resulted in a net decrease in cash and cash equivalents and restricted cash of $5.5 million during the six months ended June 30, 2025 as compared to a net increase in cash of $15.9 million for the six months ended June 30, 2024. For the six months ended June 30, 2025, net cash used in operating activities totaled $15.2 million, a decrease of approximately $18.7 million compared to the same period in 2024 primarily due to favorable changes in net working capital of $20.1 million, which includes a decrease of $17.2 million in payments made for contingent consideration during the six months ended June 30, 2024. This also includes an improvement in net working capital for the timing of cash receipts from customers and payments to vendors of $2.9 million and a year-over-year decrease in net loss from operations of $1.9 million.

Current wording

Our cash flows resulted in a net decrease in cash and cash equivalents and restricted cash of $9.6 million during the nine months ended September 30, 2025 as compared to a net increase in cash of $5.1 million for the nine months ended September 30, 2024. For the nine months ended September 30, 2025, net cash used in operating activities totaled $24.0 million, a decrease of approximately $20.6 million compared to the same period in 2024 primarily due to favorable changes in net working capital of $20.9 million, which includes a decrease of $23.3 million in payments made for contingent consideration during the nine months ended September 30, 2024, partially offset by a $3.3 million increase in accounts receivable due to an increase in revenue.

Previous wording

Net cash used in investing activities during the six months ended June 30, 2025 totaled $0.2 million, a decrease of $2.0 million compared to the same period in 2024. The decrease in net cash used in investing activities was primarily due to decreases in purchases of property and equipment and capital expenditures.

Current wording

Net cash used in investing activities during the nine months ended September 30, 2025 totaled $0.3 million, a decrease of $2.3 million compared to the same period in 2024. The decrease in net cash used in investing activities was primarily due to decreases in purchases of property and equipment and capital expenditures.

Previous wording

Net cash provided by financing activities during the six months ended June 30, 2025 totaled $9.9 million, a decrease of $42.2 million compared to the same period in 2024. The net cash provided by financing activities for the six months ended June 30, 2025 primarily resulted from $10.0 million in net proceeds from the issuance of Tranche C under the Perceptive Term Loan Facility and $0.3 million in net proceeds from our ESPP, partially offset by payments of $0.4 million associated with our finance lease obligations. The net cash provided by financing activities for the six months ended June 30, 2024 primarily resulted from $51.3 million in net proceeds from the issuance of common stock from an underwritten offering of common stock and a concurrent private placement, $0.6 million from the issuance of common stock from our ATM facility, and $0.3 million from our ESPP, partially offset by repayment of notes payable, debt issuance costs and financing leases of $0.2 million.

Current wording

Net cash provided by financing activities during the nine months ended September 30, 2025 totaled $14.7 million, a decrease of $37.5 million compared to the same period in 2024. The net cash provided by financing activities for the nine months ended September 30, 2025 primarily resulted from $10.0 million in net proceeds from the issuance of Tranche C under the Perceptive Term Loan Facility, $4.8 million net proceeds from the issuance of common stock under our ATM facility, and $0.5 million in net proceeds from our ESPP, partially offset by payments of $0.6 million associated with our finance lease obligations. The net cash provided by financing activities for the nine months ended September 30, 2024 primarily resulted from $51.3 million in net proceeds from the issuance of common stock from an underwritten offering of common stock and a concurrent private placement, $0.6 million from the issuance of common stock from our ATM facility, and $0.3 million from our ESPP.