REPLIGEN CORP

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Summary of Significant Accounting Policies

Basis of Presentation

The condensed consolidated financial statements included herein have been prepared by Repligen Corporation (the “Company”, “Repligen”, “our” or “we”) in accordance with generally accepted accounting principles in the United States (“GAAP”) and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”), for Quarterly Reports on Form 10-Q and Article 10 of Regulation S-X and do not include all of the information and footnote disclosures required by GAAP. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, which was filed with the SEC on March 14, 2025 (“Form 10-K”).

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. The business and economic uncertainty resulting from global geopolitical conflicts, supply chain challenges, foreign currency fluctuations and cost pressures on customers' purchasing patterns has made such estimates more difficult to calculate. Accordingly, actual results could differ from those estimates.

In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of only normal, recurring adjustments necessary for a fair presentation of its financial position as of September 30, 2025, its results of operations for the three and nine months ended September 30, 2025 and 2024 and cash flows for the nine months ended September 30, 2025 and 2024. The results of operations for the interim periods presented are not necessarily indicative of results to be expected for the entire year. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

During the three and nine months ended September 30, 2025, the Company made no material changes in the application of its significant accounting policies that were disclosed within Note 2, “Summary of Significant Accounting Policies”included in Part II, Item 8, “Financial Statements and Supplementary Data” to the Company's Form 10-K.

Business Combinations

Total consideration transferred for acquisitions is allocated to the tangible and intangible assets acquired and liabilities assumed, if any, based on their fair values at the dates of acquisition. This purchase price allocation process requires management to make significant estimates and assumptions with respect to intangible assets and deferred revenue. The fair value of identifiable intangible assets is based on detailed valuations that use information and assumptions determined by management. Any excess of purchase price over the fair value of the net tangible and intangible assets acquired is allocated to goodwill. While the Company uses its best estimates and assumptions to accurately value assets acquired and liabilities assumed at the acquisition date as well as any contingent consideration, where applicable, the Company’s estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, the Company records adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the Company’s consolidated statements of comprehensive income. The fair value of contingent consideration includes estimates and judgments made by management regarding the probability that future contingent payments will be made and the extent of royalties to be earned in excess of the defined minimum royalties. Management updates these estimates and the related fair value of contingent consideration at each reporting period. These changes in the fair value of contingent consideration are recorded to contingent consideration in the Company’s condensed consolidated statements of comprehensive income.

The Company typically uses the income approach to determine the fair value of certain identifiable intangible assets including customer relationships and developed technology. This approach determines fair value by estimating after-tax cash flows attributable to these assets over their respective useful lives and then discounting these after-tax cash flows back to a present value. The Company bases its assumptions on estimates of future cash flows, expected growth rates, expected trends in technology, etc. Discount rates used to arrive at a present value as of the date of acquisition are based on the time value of money and certain industry-specific risk factors. The Company believes the estimated purchased customer relationships, developed technologies, trademark/tradename and other intangible assets identified in its acquisitions represent the fair value at the date of acquisition, and do not exceed the amount a third-party would pay for such assets.

Recent Accounting Guidance

The Company considers the applicability and impact of all Accounting Standards Updates (“ASU”) issued by the Financial Accounting Standards Board (“FASB”) and other recently issued guidance or rule decisions on their condensed consolidated financial statements. Updates not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Company’s condensed consolidated financial position or results of operations.

Recently Issued Accounting Guidance – Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”, which requires disclosure of specific expense categories in the notes to the financial statements. This includes: (i) amounts of purchased inventory, employee compensation, depreciation, amortization and other related costs and expenses; (ii) an explanation of costs and expenses that are not disaggregated on a quantitative basis; and (iii) the definition and total amount of selling expenses. The amendment is effective for annual reporting periods beginning after December 15, 2026, with early adoption permitted, and interim reporting periods beginning after December 15, 2027. The amendment should be applied prospectively to financial reporting periods after the effective date or retrospectively to any or all prior periods presented in the financial statements. The Company is currently evaluating the impact that the adoption of this standard will have on its consolidated financial statements and related disclosures.

In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740) - Improvements to Income Tax Disclosures” to enhance the transparency and decision usefulness of income tax disclosures by requiring consistent categories and greater disaggregation of information in the rate reconciliation and income taxes paid disaggregated by jurisdiction. The amendment is effective for annual reporting periods beginning after December 15, 2024. The Company will apply the amendment on a prospective basis. The Company does not expect the adoption of ASU 2023-09 to have a material impact on its condensed consolidated financial statements and related disclosures.

Fair Value Measurements

The Company uses various valuation approaches in determining the fair value of its assets and liabilities. The Company employs a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. The fair value hierarchy is broken down into three levels based on the source of inputs as follows:

The availability of observable inputs can vary among the various types of financial assets and liabilities. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for financial statement disclosure purposes, the level in the fair value hierarchy within which the fair value measurement is categorized is based on the lowest level input that is significant to the overall fair value measurement.

Fair Value Measured on a Recurring Basis

Financial assets and financial liabilities measured at fair value on a recurring basis consist of the following as of September 30, 2025 and December 31, 2024:

Contingent Consideration – Earnouts

As of September 30, 2025, the maximum amount of future contingent consideration (undiscounted) that the Company could be required to pay in connection with each of its completed acquisitions is $54.5 million over a three-year period for Tantti Laboratory Inc. (“Tantti”), which was acquired in December 2024.

A reconciliation of the change in the fair value of contingent consideration – earnouts is included in the following table (amounts in thousands):

The recurring Level 3 fair value measurement of our contingent consideration obligations for Tantti include the following significant unobservable inputs (amounts in thousands, except percent data):

(1)

Unobservable inputs were weighted by the relative fair value of the contingent consideration liability.

The fair value of the contingent consideration liability is valued using the inputs noted in the table above. During the three and nine months ended September 30, 2025, the Company adjusted its revenue targets for Tantti based on revised forecasts. Accordingly, during the three and nine months ended September 30, 2025, the Company recognized a gain of$4.1 million and$12.1 million, respectively, related to the change in fair value of contingent consideration. Changes in the projected performance of the acquired business could result in a higher or lower contingent consideration obligation in the future.

Fair Value of Other Financial Instruments

The fair value of outstanding foreign exchange forward contracts are valued using quoted forward foreign exchange prices at the reporting date. See Note 3, “Derivative Instruments”, for additional information.

Convertible Senior Notes

At September 30, 2025 and December 31, 2024, the fair value of the Company’s 1.00% Convertible Senior Notes due 2028 (the “2023 Notes”) was$598.8 million and $546.1 million, respectively. The fair value of the 2023 Notes is a Level 1 valuation and was determined based on the most recent trade activity of the 2023 Notes as of September 30, 2025 and December 31, 2024. See Note 9, “Convertible Senior Notes”, for additional information.

Fair Value Measured on a Nonrecurring Basis

During the three and nine months ended September 30, 2025, there were no re-measurements to the fair value of financial assets and liabilities that are measured at fair value on a nonrecurring basis.

Derivative Instruments

The primary risk managed by the Company using derivative instruments is foreign exchange risk. Foreign exchange forward contracts are entered into as hedges against unfavorable fluctuations in the United States (“U.S.”) dollar to Swedish krona (SEK) exchange rates. The Company does not apply hedge accounting to these contracts because these derivative instruments are not qualified as accounting hedges; therefore the changes in fair value are recorded in the condensed consolidated statements of comprehensive income. By using derivative instruments to mitigate exposures to changes in foreign exchange rates, the Company is exposed to credit risk from the failure of the counterparty to perform under the terms of the contract. The credit or repayment risk is minimized by entering into transactions with high-quality counterparties.

There wereno outstanding contracts at September 30, 2025. The notional amounts of the outstanding contracts at December 31, 2024 were as follows (amounts in thousands):

The fair value of outstanding derivative instruments recorded in the accompanying condensed consolidated balance sheets were as follows:

The effects of derivative instruments on thecondensed consolidated statements of comprehensive income were as follows:

Acquisitions

2025 Acquisition

908 Devices Inc. Bioprocessing Analytics Portfolio

On March 4, 2025, the Company completed its acquisition of 908 Devices Inc.’s (“908 Devices”) desktop portfolio of four devices for bioprocessing process analytical technology applications (“PAT Portfolio”). In connection with the transaction, Repligen also acquired facilities, employees, equipment and lease obligations for facilities in North Carolina and Braunschweig, Germany as well as certain working capital balances related to the PAT Portfolio. This transaction is referred to as the 908 Devices PAT Portfolio acquisition.

Consideration Transferred

The Company accounted for the 908 Devices PAT Portfolio acquisition as a purchase of a business under Accounting Standards Codification (“ASC”) 805, “Business Combinations.” Under the securities and asset purchase agreement, the PAT portfolio and associated net assets were acquired for cash consideration of $69.9 million, subject to a working capital adjustment to be finalized in a future period. Under the acquisition method of accounting, the assets acquired and liabilities assumed were recorded as of the acquisition date, at their respective fair values and consolidated with those of the Company. The provisional fair value of the net tangible assets acquired is estimated to be $6.2 million, the provisional fair value of intangible assets acquired is estimated to be $13.6 million and the residual provisional goodwill is estimated to be $50.1 million. Acquisition-related costs are not included as a component of consideration transferred but are expensed in the periods in which such costs are incurred. The Company has incurred $10.5 million of transaction and integration costs associated with the 908 Devices PAT Portfolio acquisition from the date of acquisition to September 30, 2025, of which $2.1 million and $10.5 million were incurred during the three and nine months ended September 30, 2025, respectively. The transaction and integration costs are included in operating expenses in the condensed consolidated statements of comprehensive income.

Fair Value of Net Assets Acquired

The preliminary purchase price allocation is based on the fair value of assets acquired and liabilities assumed as of the acquisition date. As of September 30, 2025, the purchase accounting for this acquisition has not been finalized and has been recorded on a provisional basis. As additional information becomes available, the Company may further revise its preliminary purchase price allocation during the remainder of the measurement period. The Company expects to finalize this determination during or before the quarter ending March 31, 2026. Amounts recorded on a provisional basis include but are not limited to intangible assets, working capital accounts including inventories, deferred tax accounts, deferred revenues, lease assets and goodwill.

The components and estimated allocation of the purchase price consist of the following (amounts in thousands):

There wereno significant changes to the preliminary purchase price allocation during thethree and nine months ended September 30, 2025.

Acquired Goodwill

The provisional goodwill of $50.1 million represents future economic benefits expected to arise from anticipated synergies from the integration of the PAT Portfolio into the Company. These synergies include operating efficiencies and strategic benefits projected to be achieved as a result of the 908 Devices PAT Portfolio acquisition. Goodwill is calculated based on the acquired assets in the United States and Germany. Goodwill related to the United States of $39.2 million is deductible for income tax purposes. The goodwill of $10.9 million related to Germanyis expected to be nondeductible for income tax purposes.

Intangible Assets

The following table sets forth the components of the identified intangible assets (determined on a provisional basis and thus subject to change during the measurement period) associated with the 908 Devices PAT Portfolio acquisition and their estimated useful lives:

2024 Acquisition

Tantti Laboratory Inc.

On December 2, 2024, the Company's subsidiary, Repligen Sweden AB, acquired Tantti from the former shareholders of Tantti (“Tantti Seller”) pursuant to a share swap agreement, dated as of July 27, 2024 (such acquisition, the “Tantti Acquisition” and such agreement, the “Share Swap Agreement”), by and among Repligen Sweden AB, the Tantti Seller and the Company, in its capacity as guarantor of the obligations of Repligen Sweden AB under the share purchase agreement (the “Share Purchase Agreement”).

Tantti, headquartered in Taoyuan City, Taiwan, has developed a unique portfolio of macroporous chromatography beads to optimize the purification of new modalities including viral vectors, viruses, nucleic acids and other large molecule biologics. The addition of Tantti further strengthens our portfolio in the new modality space.

Consideration Transferred

The Company accounted for the Tantti Acquisition as a purchase of a business under ASC 805, “Business Combinations.” Under the Share Swap Agreement, all outstanding equity interests of Tantti were acquired for consideration with a value totaling $75.1 million. The Tantti Acquisition was funded through payment of $55.4 million in cash and contingent consideration with an estimated fair value of $19.7 millionas of the acquisition date. Under the acquisition method of accounting, the assets acquired and liabilities assumed were recorded as of the acquisition date, at their respective fair values and consolidated with those of the

Company. The provisional fair value of the net tangible liabilities acquired is estimated to be $0.8 million, the provisional fair value of the intangible assets acquired is estimated to be $28.9 million and the residual provisional goodwill is estimated to be $46.9 million. Acquisition-related costs are not included as a component of consideration transferred but are expensed in the periods in which costs are incurred. The Company incurred $4.2 million of transaction and integration costs associated with the Tantti Acquisition from the date of acquisition to September 30, 2025, of which $0.8 million and $2.6 million were incurred during thethree and nine months ended September 30, 2025, respectively. The transaction costs are included in operating expenses in the condensed consolidated statements of comprehensive income.

Fair Value of Net Assets Acquired

The preliminary purchase price allocation is based on the fair value of assets acquired and liabilities assumed as of the acquisition date. As of September 30, 2025, the purchase accounting for this acquisition has not been finalized and has been recorded on a provisional basis. As additional information becomes available, the Company may further revise its preliminary purchase price allocation during the remainder of the measurement period. The Company expects to finalize this determination during or before the quarter ending December 31, 2025. The components and estimated allocation of the purchase price consist of the following (amounts in thousands):

There wereno significant changes to the preliminary purchase price allocation during thethree and nine months ended September 30, 2025.

Acquired Goodwill

The provisional goodwill of $46.9 million represents future economic benefits expected to arise from anticipated synergies from the integration of Tantti into the Company. These synergies include operating efficiencies and strategic benefits projected to be achieved as a result of the Tantti Acquisition. Substantially all of the goodwill recorded is expected to be nondeductible for income tax purposes.

Intangible Assets

The identified intangible asset (determined on a provisional basis and thus subject to change during the measurement period) associated with the Tantti Acquisition is developed technology of $28.9 million with a useful life ofnine years.

Restructuring Activities and Other Inventory-Related Charges

In July 2023, the Board of Directors authorized the Company's management team to undertake restructuring activities to simplify and streamline our organization and strengthen the overall effectiveness of our operations. Since the initial streamlining and rebalancing efforts contemplated in July 2023, and with the introduction of new management in the second half of 2024, the Company continued to undertake further restructuring activities (collectively, the “Restructuring Plan”) which has included consolidating a portion of our manufacturing operations between certain U.S. locations, writing-off abandoned equipment with the rationalization of excess production line capacity and discontinuing the sale of certain product SKUs. In addition, the Company evaluated the net realizable value of finished goods and raw materials to meet rapidly changing demand during a challenging supply chain environment in the industry during 2023 and 2024.

The Company recorded pre-tax restructuring charges of $4.1 million for thenine months ended September 30, 2025, and pre-tax charges of $2.9 million and $5.3 million for thethree and nine months ended September 30, 2024, respectively, related to the Restructuring Plan. The Restructuring Plan was completed during the second quarter of 2025. The Company does not expect to incur further significant charges related to the Restructuring Plan. Asof September 30, 2025, the total pre-tax restructuring activity incurred related to the Restructuring Plan and other inventory-related charges is $83.3 million, of which $59.7 million related to other inventory-related charges. For more information, see Note 6, “Restructuring Activities and Other Inventory-Related Charges” included in Part II, Item 8, “Financial Statements and Supplementary Data” to the Company's Form 10-K.

The following tables summarize the charges related to restructuring activities by type of cost for the periods presented on the Company’scondensed consolidated statements of comprehensive income:

Severance and employee-related costs under the Restructuring Plan are primarily associated with actual headcount reductions. Costs incurred include cash severance and non-cash severance, including other termination benefits. Severance and other termination benefit packages are based on established benefit arrangements or local statutory requirements and we recognized the contractual component of these benefits when payment was probable and could be reasonably estimated.

The Company’s manufacturing strategy and footprint were reviewed as a part of our 2024 annual strategic planning and budget session. These exit activities initiated in 2024 were completed in the second quarter of 2025.

As of September 30, 2025, there wasno restructuring liability remaining in thecondensed consolidated balance sheets. Activity related to the Restructuring Plan for thenine months ended September 30, 2025 was as follows:

Revenue Recognition

Disaggregation of Revenue

Revenues for thethree and nine months ended September 30, 2025 and 2024 were as follows:

When disaggregating revenue, the Company considered all of the economic factors that may affect its revenues. Because its revenues are from bioprocessing customers, there are no differences in the nature, timing and uncertainty of the Company’s revenues and cash flows from any of its product lines. However, given that the Company’s revenues are generated in different geographic regions, factors such as regulatory, economic and geopolitical developments within those regions could impact the nature, timing and uncertainty of the Company’s revenues and cash flows.

Disaggregated revenue from contracts with customers by geographic region and revenue from significant customers can be found in Note 15, “Segment Reporting.” For more information regarding product revenue, see Note 8, “Revenue Recognition” included in Part II, Item 8, “Financial Statements and Supplementary Data” to the Company's Form 10-K.

Contract Balances from Contracts with Customers

The following table provides information about receivables and deferred revenue from contracts with customers as of September 30, 2025 and December 31, 2024:

During the nine months ended September 30, 2025, the Company recognized$9.9 million of revenue that was deferred and included within accrued liabilities and other noncurrent current liabilities as of December 31, 2024. During the nine months ended September 30, 2024, the Company recognized$15.4 million of revenue that was deferred and included within accrued liabilities and other noncurrent current liabilities as of December 31, 2023.

The timing of revenue recognition, billings and cash collections results in the accounts receivable and deferred revenue balances on the Company’s condensed consolidated balance sheets.

Goodwill and Intangible Assets

Goodwill

The following table represents the change in the carrying value of goodwill for thenine months ended September 30, 2025 (amounts in thousands):

The Company’s annual impairment analysis of goodwill was performed as of October 1, 2025. The qualitative assessment of the Company’sone reporting unit indicated there were no indications of impairment and it was not more likely than not that its fair value was less than its carrying amount.

Intangible assets

Indefinite-lived intangible assets are reviewed for impairment at least annually. Definite-lived intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. There has beenno impairment of the Company’s intangible assets for the periods presented.

Intangible assets, net, consisted of the following at September 30, 2025 and December 31, 2024:

Amortization expense for finite-lived intangible assets was$9.9 million and$8.6 million for each of the three months ended September 30, 2025 and 2024, respectively, and$29.3 million and$26.0 million for each of the nine months ended September 30, 2025 and 2024, respectively. As of September 30, 2025, the Company expects to record the following amortization expense in future periods:

Condensed Consolidated Balance Sheets Detail

Inventories, net

Inventories, net consists of the following:

Property, plant and equipment, net

Property, plant and equipment, net consists of the following:

Accrued liabilities

Accrued liabilities consist of the following:

Convertible Senior Notes

The carrying value of the Company's Convertible Senior Notes is as follows:

1.00% Convertible Senior Notes due 2028

On December 14, 2023, the Company issued $600.0 million aggregate principal amount of its 2023 Notes pursuant to the Exchange and Subscription Agreements with a limited number of holders of the 0.375% Convertible Senior Notes due 2024 (the “2019 Notes”) and certain other qualified institutional buyers pursuant to Rule 144A under the Securities Act. Pursuant to the Exchange and Subscription Agreements, the Company exchanged $217.7 million of its 2019 Notes, which were cancelled upon exchange, for $309.9 million aggregate principal amount of the 2023 Notes (the “Exchange Transaction”) and issued $290.1 million aggregate principal amount of the 2023 Notes in a private placement to accredited institutional buyers (the “Subscription Transactions”) for $290.1 million in cash.

The Company evaluated the Exchange Transaction and determined approximately $29.6 million of the $217.7 million principal of the exchanged 2019 Notes should be accounted for as extinguishment of debt and approximately $188.1 million should be accounted for as modification of debt. As a result, the Company recognized a $12.7 million loss on extinguishment of debt in its consolidated statements of comprehensive income for the year ended December 31, 2023, inclusive of $0.1 million of unamortized debt issuance costs. Under debt modification accounting, the carrying amount of the modified 2019 Notes was reduced by $2.8 million, with a corresponding increase to additional paid-in capital, to account for the increase in the fair value of the embedded conversion option, representing a debt discount of the modified 2019 Notes. The aggregate debt discount of $56.6 million as of September 30, 2025 is comprised of a $54.8 million increase in principal of the modified 2019 Notes and a $1.8 million increase in the fair value of the embedded conversion option. The aggregate debt discount of $67.7 million as of December 31, 2024, is comprised of $65.5 million increase in principal of the modified 2019 Notes and a $2.2 million increase in the fair value of the embedded conversion option. These amounts are presented in their respective periods as a direct reduction fromthe carrying value of the convertible debt in our condensed consolidated balance sheets. This amount is being accreted into interest expense in the condensed consolidated statements of comprehensive income using the effective interest method over the term of the 2023 Notes.

Proceeds from the Subscription Transactions were $276.1 million, net of debt issuance costs of $13.9 million. The Exchange Transaction resulted in $6.2 million of the debt issuance costs related to the modified 2019 Notes, which were expensed as incurred in accordance with debt modification accounting, and $7.7 million of deferred debt issuance costs related to the 2023 Notes, which were recorded as a direct deduction to the carrying value of the 2023 Notes on the Company’s condensed consolidated balance sheets. The Company is amortizing the $7.8 million of debt issuance costs of the 2023 Notes into amortization of debt issuance costs in the Company’s condensed consolidated statements of comprehensive income over the remaining term of the 2023 Notes.

The Company used $14.4 million of the proceeds from the Subscription Transactions to repurchase shares of its common stock from certain purchasers of the 2023 Notes. For more information regarding this repurchase, see Note 13, “Stockholders’ Equity - Share Repurchases” included in Part II, Item 8, “Financial Statements and Supplementary Data,” to the Company's Form 10-K. The Company also used a portion of the proceeds to finance in part, the settlement upon redemption of the remaining 2019 Notes at maturity. The remainder of the proceeds were used for working capital.

The 2023 Notes are senior, unsecured obligations of the Company, and bear interest at a rate of 1.00% per year and have an effective interest rate of 4.39%. Interest is payable semi-annually in arrears on each of June 15 and December 15, which commenced on June 15, 2024. The 2023 Notes will mature on December 15, 2028, unless earlier redeemed, repurchased or converted. During thethird quarter of 2025, the closing price of the Company’s common stock did not exceed 130% of the conversion price of the 2023 Notes for more than 20 trading days of the last 30 consecutive trading of the quarter. As a result, the 2023 Notes are not convertible at the option of the holders of the 2023 Notes during thefourth quarter of 2025, the quarter immediately following the quarter when the conditions are met, as stated in the indenture governing the 2023 Notes. Because the 2023 Notes were not convertible as of September 30, 2025, the Company continues to classify the carrying value of the 2023 Notes of$537.9 million as noncurrent liabilities on the Company’s condensed consolidated balance sheet at September 30, 2025.

The initial conversion rate for the 2023 Notes is 4.9247 shares of the Company’s common stock per $1,000 principal amount of 2023 Notes, which is equivalent to an initial conversion price of $203.06 per share and represents a 30% premium over the last reported sale price of $156.20 per share on December 6, 2023, the date on which the 2023 Notes were priced. Prior to the close of business on the business day immediately preceding September 15, 2028, the 2023 Notes will be convertible at the option of the holders of 2023 Notes only upon the satisfaction of the specified conditions mentioned above into cash up to their principal amount, and into cash, shares of the Company’s common stock or a combination thereof, at the Company’s election, for the conversion value above the principal amount, if any. Thereafter until the close of business on the second scheduled trading day immediately preceding the maturity date, the 2023 Notes will be convertible at the option of the holders of 2023 Notes at any time regardless of these conditions. The Company may redeem for cash, all or a portion of the 2023 Notes, at its option, on or after December 18, 2026 and prior to the 21 st scheduled trading day immediately preceding the maturity date at a redemption price of 100% of the principal amount of the 2023 Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date, if certain conditions are met in accordance with the indenture governing the 2023 Notes. For more information on the 2023 Notes, see Note 15, “Convertible Senior Notes” included in Part II, Item 8, “Financial Statements and Supplementary Data” to the Company's Form 10-K.

The following table sets forth total interest expense recognized related to the 2019 and 2023 Notes for thethree and nine months ended September 30, 2025 and 2024:

Stockholders’ Equity

Stock Option and Incentive Plans

Under the Company’s current 2018 Stock Option and Incentive Plan (the “2018 Plan”), the number of shares of the Company’s common stock that were reserved and available for issuance was 2,778,000, plus the number of shares of common stock that were available for issuance under the Company’s previous equity plans. The shares of common stock underlying any awards under the 2018 Plan and previous equity plans (together, the “Plans”) that are forfeited, canceled or otherwise terminated (other than by exercise) shall be added back to the shares of stock available for issuance under the 2018 Plan. At September 30, 2025,1,187,708 shares were available for future grants under the 2018 Plan.

Former Chief Executive Officer Accounting Modifications

On June 12, 2024, upon approval by the Board, the Company entered into the Fourth Amended and Restated Employment Agreement (the “Transition Agreement”) with the Company's former Chief Executive Officer (“CEO”), Tony J. Hunt, which amends and restates Mr. Hunt's Third Amended and Restated Employment Agreement with the Company dated as of May 26, 2022. Under the terms of the Transition Agreement, Mr. Hunt relinquished his position as the Company's CEO effective September 1, 2024 (the “Transition Date”) and transitioned to a new role as Executive Chair of the Board beginning on the Transition Date (the “CEO Transition”). It is anticipated that Mr. Hunt will continue to be involved in the business as the Executive Chair of the Board until March 2026 and will continue to be employed by the Company as an advisor thereafter, until March 2027.

Under the terms of the Transition Agreement and the award agreements governing Mr. Hunt’s outstanding equity awards, Mr. Hunt’s unvested stock awards will continue to vest in accordance with their original terms. Furthermore, on June 28, 2024, the Company entered into an amendment (the “2024 Award Amendment”) to the equity awards granted to Mr. Hunt in 2024, which consisted of a stock option, restricted stock units (“RSUs”) and performance stock units (“PSUs” and together with the RSUs, the “2024 Grants”). Pursuant to the terms of the 2024 Award Amendment, two-thirds of the 2024 Grants were forfeited, which equates to 32,776 shares of the Company’s common stock.

Although Mr. Hunt’s unvested equity awards continue to vest in accordance with their original terms and there has been no amendment to Mr. Hunt’s outstanding equity awards other than the 2024 Award Amendment, the Company determined that under ASC 718, “Compensation - Stock Compensation”, the CEO Transition represented a significant reduction in Mr. Hunt’s operating role with the Company for accounting purposes. This determination resulted in a Type III accounting modification of certain of Mr. Hunt’s unvested stock awards (improbable to probable) under ASC 718 (the “Equity Modification”) on June 12, 2024. As a result, for accounting purposes only, Mr. Hunt’s unvested awards were deemed cancelled and a new grant issued for his unvested shares with the value of these awards recalculated using a price of $136.00 per share, which was the opening stock price of the first day of trading following the public announcement of the CEO Transition.

As a result of the Equity Modification, the Company recognized stock-based compensation expense for the modified awards of $22.4 million over the remaining requisite service period, which the Company determined to be between June 13, 2024 and September 1, 2024 and represented the remaining service period of Mr. Hunt’s role as CEO.

The Company determined that the PSUs granted to Mr. Hunt in 2022 and 2023 should be accounted for as a Type IV accounting modification (improbable to improbable) in accordance with ASC 718, because vesting conditions before and after June 12, 2024 were improbable of being achieved.

Stock Issued for Earnout Payments

In April 2025, the Company issued 52,935 shares of its common stock to former securityholders of Avitide to satisfy the final contingent consideration obligation established under the Agreement and Plan of Merger and Reorganization (the “Avitide Agreement”) which the Company entered into as part of the acquisition of Avitide in September 2021.

In April 2025, the Company issued 5,517 shares of its common stock to former securityholders of FlexBiosys, Inc. (“FlexBiosys”)to satisfy the final contingent consideration obligation established under the Equity Purchase Agreement (the “FlexBiosys Agreement”), which the Company entered into as part of the acquisition of FlexBiosys in April 2023.

In April 2024, the Company issued 28,638 shares of its common stock to former securityholders of Avitide to satisfy the contingent consideration obligation established under the Avitide Agreement.

In March 2024, the Company issued 2,770 shares of its common stock to former securityholders of FlexBiosys to satisfy the contingent consideration obligation established under the FlexBiosys Agreement.

See Note 5, “Acquisitions”, included in Part II, Item 8, “Financial Statements and Supplementary Data” to the Company's Form 10-K for additional information on the acquisitions of Avitide and FlexBiosys and the contingent consideration. The shares issued to FlexBiosys represent 20% of the earnout consideration earned in the First Earnout Year (as defined in the FlexBiosys Agreement) and the shares issued to Avitide represents 50% of the earnout consideration earned in the Second Earnout Year (as defined in the Avitide Agreement).

Stock-Based Compensation

The following table presents stock-based compensation expense in the Company’scondensed consolidated statements of comprehensive income:

(1)

Selling, general and administrative stock-based compensation for thethree and nine months ended September 30, 2024 includes $17.4 million and $22.4 million, respectively, of expense related to the Equity Modification discussed above.

Stock Options

Information regarding option activity for thenine months ended September 30, 2025 under the Plans is summarized below:

(1)

Represents the number of vested options as of September 30, 2025 plus the number of unvested options expected to vest as of September 30, 2025 based on the unvested outstanding options at September 30, 2025 adjusted for estimated forfeiture rates of 8% for awards granted to non-executive level employees and 3% for awards granted to executive level employees.

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value that would have been received by the option holders had all option holders exercised their options on September 30, 2025. The aggregate intrinsic value of stock options exercised was $4.3 million and $4.7 million during the nine months ended September 30, 2025 and 2024, respectively.

The weighted average grant date fair value of options granted during the nine months ended September 30, 2025 and 2024 was$72.94 and $89.09, respectively.

Stock Units

The fair value of stock units is calculated using the closing price of the Company’s common stock on the date of grant. The Company recognizes expense on awards with service-based vesting over the employee’s requisite service period on a straight-line basis. The Company recognizes expense on performance-based awards over the vesting period based on the probability that the performance metrics will be achieved. Information regarding stock unit activity, which includes activity for restricted stock units and performance stock units, for thenine months ended September 30, 2025 under the Plans is summarized below:

(1)

Represents the number of vested stock units as of September 30, 2025 plus the number of unvested stock units expected to vest as of September 30, 2025 based on the unvested outstanding stock units at September 30, 2025 adjusted for estimated forfeiture rates of 8% for awards granted to non-executive level employees and 3% for awards granted to executive level employees.

The aggregate intrinsic value of stock units vested during the nine months ended September 30, 2025 and 2024 was $20.8 million and $25.1 million, resp ectively.

The weighted average grant date fair value of stock units granted during the nine months ended September 30, 2025 and 2024 was $144.23 and $180.02, respecti vely.

As of September 30, 2025, there was $72.0 million of total unrecognized compensation cost related to unvested share-based awards. This cost is expected to be recognized over a weighted average remaining requisite service period of 2.78 years.

Commitments and Contingencies

Collaboration Agreements

The Company licenses certain technologies that are, or may be, incorporated into its technology under several agreements and also has entered into several clinical research agreements that require the Company to fund certain research projects. Generally, the license agreements require the Company to pay annual maintenance fees and royalties on product sales once a product has been established using the technologies. Research and development expenses associated with license agreements were immaterial amounts for the three and nine months ended September 30, 2025 and 2024.

Legal Proceedings

From time to time, in the normal course of its operations, the Company is subject to litigation matters and claims relating to employee relations, business practices and patent infringement. Litigation can be expensive and disruptive to normal business operations. Moreover, the results of complex legal proceedings are difficult to predict, and the Company's view of these matters may change in the future as the litigation and events related thereto unfold. The Company expenses legal fees as incurred. The Company records a provision for contingent losses when it is both probably that a liability has been incurred and the amount of the loss can be reasonably estimated. An unfavorable outcome to any legal matter, if material, could have an adverse effect on the Company's operations or its financial results.

Income Taxes

For the three and nine months ended September 30, 2025, the Company recorded income tax provisions of$2.2 million and$7.7 million, respectively. The Company’s effective tax rate for the three and nine months ended September 30, 2025 was 12.9% and 17.7%, respectively, compared to 43.0% and 27.8% for the corresponding periods in the prior year. The difference in effective tax rates between the periods was primarily due to nontaxable contingent consideration and lower nondeductible stock-based compensation offset by lower stock windfall tax benefits.

On July 4, 2025, the United States enacted into law new tax legislation, the One Big Beautiful Bill Act (“OBBBA”), which contains several provisions modifying the corporate income tax code such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, updates to the international tax framework and the reinstatement of certain business related provisions. The legislation has multiple effective dates, with provisions taking effect from 2025 through 2027. The Company does not expect the OBBBA to have a material impact on its consolidated financial statements or results of operations.

Earnings (Loss) Per Share

The Company reports earnings or loss per share in accordance with ASC 260, “Earnings Per Share,” which establishes standards for computing and presenting earnings or loss per share. Basic earnings or loss per share is computed by dividing net income or loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings or loss per share is computed by dividing net income or loss available to common shareholders by the weighted-average number of common shares and dilutive common share equivalents outstanding during the period. Potential common share equivalents consist of restricted stock awards (including performance stock units) and the incremental common shares issuable upon the exercise of stock options and stock issuable upon conversion of convertible debt securities. The dilutive effects of restricted stock awards and stock options are reflected in diluted earnings or loss per share by application of the treasury stock method. The dilutive effect of shares issuable upon conversion of the convertible debt securities are included in the calculation of diluted earnings or loss per share under the if-converted method.

In periods where the Company is in a net loss position, diluted loss per share is the same as basic loss per share, as the effects of common stock equivalents outstanding and shares issuable upon conversion of convertible debt securities are antidilutive and therefore excluded from the calculation of diluted loss per share.

A reconciliation of basic and diluted weighted average shares outstanding is as follows:

For the three and nine months ended September 30, 2025,652,930 shares and 610,880 shares, respectively, of the Company’s common stock were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive. Comparatively, for thethree and nine months ended September 30, 2024,491,206 shares and 404,989 shares, respectively were excluded because their inclusion would have been anti-dilutive.

Related Party Transactions

Certain facilities leased by our subsidiary, Spectrum LifeSciences LLC (“Spectrum”) are owned by the Roy Eddleman Living Trust (the “Trust”). As of September 30, 2025, the Trust is considered a related party to the Company based on the level of ownership during the reporting period. The lease payments to the Trust were negotiated in connection with the acquisition of Spectrum. The Company incurred rent expense totaling $0.2 million and $0.1 million for thethree months ended September 30, 2025 and 2024, respectively, and incurred $0.5 million for thenine months ended September 30, 2025 and 2024, related to the leases.

Segment Reporting

Operating segments are components of an enterprise that engage in business activities for which discrete financial information is available and regularly reviewed by the Chief Operating Decision Maker (the “CODM”) in deciding how to allocate resources and assess performance. The Company’s CEO has been identified as the CODM.

The Company views its operations, makes decisions regarding how to allocate resources and manages its business asone reportable segment andone reporting unit. Net income or net loss as reported on the condensed consolidated statements of comprehensive income is the measure of segment profit or loss used by the CODM in allocating resources and assessing performance. Total assets for the operating segment is the amount presented on thecondensed consolidated balance sheets.

The following table represents the Company’s total revenue by customers’ geographic locations:

The following table presents the Company’s significant segment expenses which are regularly provided to the CODM for the single reportable segment:

Concentrations of Credit Risk and Significant Customers

Financial instruments that subject the Company to significant concentrations of credit risk primarily consist of cash and cash equivalents, marketable securities, accounts receivable, and foreign exchange forward contracts. Per the Company’s investment policy, cash equivalents and marketable securities are invested in financial instruments with high credit ratings. Additionally, the policy limits the credit exposure to any one issuer (with the exception of U.S. treasury obligations) and the types of instruments held. As of September 30, 2025 and December 31, 2024, the Company had no investments associated with foreign exchange contracts or options contracts. The Company uses derivative financial instruments to manage exposure to foreign exchange risk on certain repayable intercompany loans with foreign subsidiaries, specifically foreign exchange forward contracts. No such instruments are outstanding as of September 30, 2025.

Concentration of credit risk with respect to accounts receivable is limited to customers to whom the Company makes significant sales. While a reserve for the potential write-off of accounts receivable is maintained, the Company has not written off any significant accounts to date. To control credit risk, the Company performs regular credit evaluations of its customers’ financial condition.

No customers represented 10% or more of the Company's total revenue for each of thethree and nine months ended September 30, 2025 and 2024.

No customers represented 10% or more of the Company's total trade accounts receivable at September 30, 2025 and December 31, 2024.