Beta Bionics, Inc.

Previous wording

We are a commercial-stage medical device company engaged in the design, development, and commercialization of innovative solutions to improve the health and quality of life of insulin-requiring people with diabetes (PWD) by utilizing advanced adaptive closed-loop algorithms to simplify and improve the treatment of their disease. Diabetes is a serious, chronic and often lifelong condition with no known cure that is characterized by extended periods of elevated levels of glucose in the bloodstream (hyperglycemia), resulting from the body’s inability to either produce or effectively utilize the hormone insulin. To treat their diabetes, PWD must undergo a rigorous regimen of daily insulin substitution as elevated levels of glucose in the blood over time can lead to serious and often life-threatening cardiovascular, metabolic and nervous system complications. Despite decades of innovation that have advanced the quality of care available, a significant unmet need remains as the vast majority of PWD still cannot manage their diabetes effectively. Our product, the iLet, is the first insulin delivery device cleared by the U.S. Food and Drug Administration (FDA) to utilize adaptive closed-loop algorithms to autonomously determine every insulin dose without requiring a user to count carbohydrate intake. We believe this marks a significant advancement over other insulin delivery technologies by offering a differentiated combination of improved glycemic control and a vastly simplified experience for users and caregivers.

Current wording

We are a commercial-stage medical device company engaged in the design, development, and commercialization of innovative solutions to improve the health and quality of life of insulin-requiring people with diabetes (PWD) by utilizing advanced adaptive closed-loop algorithms to simplify and improve the treatment of their disease. Diabetes is a chronic condition that requires ongoing insulin therapy, and suboptimal glycemic control remains common despite advances in treatment technologies. Our product, the iLet, is the first insulin delivery device cleared by the U.S. Food and Drug Administration (FDA) to utilize adaptive closed-loop algorithms to autonomously determine every insulin dose without requiring users to count carbohydrate intake. We believe this represents a significant advancement over currently available insulin delivery options by combining improved glycemic control with a simplified user experience.

Previous wording

The iLet was specifically designed to provide improvements in glycemic control relative to currently available treatment options, such as insulin pumps, including partially automated insulin delivery (AID) systems (also known as hybrid closed-loop systems), and multiple daily injections (MDI), also reducing the complexity and burden of achieving these improved results for PWD. It is enabled by adaptive closed-loop algorithms that continuously learn each person’s unique and everchanging insulin requirements and then autonomously delivers the correct insulin doses every five minutes throughout the day and night. Only the user’s body weight is required for device initialization and the autonomous determination of all insulin doses, unlike insulin pumps and hybrid closed-loop systems, which require a complex host of parameters to configure. The adaptive closed-loop algorithms are designed to remove the need to manually adjust insulin pump therapy settings and variables required by conventional pump therapy and hybrid closed-loop systems, which both require the user to determine the size and timing of both meal and correction insulin doses and to adjust basal insulin dosing. Therefore, we believe the adaptive closed-loop algorithms can make the iLet easier to initiate and use on a daily basis than other available AID systems.

Current wording

The iLet was designed to provide improved glycemic control relative to currently available treatment options, such as insulin pumps, partially automated insulin delivery systems, and multiple daily injections (MDI), while reducing the workload associated with achieving these outcomes. It uses adaptive closed-loop algorithms that learn each person’s unique and changing insulin requirements and autonomously deliver the appropriate insulin dose every five minutes throughout the day and night. Only the user’s body weight is required for initialization, unlike traditional pump and hybrid closed-loop systems that require numerous user-defined parameters. These adaptive algorithms eliminate the need to manually adjust pump settings or calculate meal and correction doses, which we believe makes the iLet easier to initiate and use than other available systems.

Previous wording

Our initial commercialization efforts for the iLet are in type 1 diabetes (T1D), an indication for which we received FDA clearance in patients six and older in May 2023, in the United States. T1D is an autoimmune disorder that often develops during childhood or adolescence, but can occur at any age, and arises from a person’s immune system attacking and destroying the insulin-producing beta cells in the pancreas. According to the Centers for Disease Control and Prevention (CDC), there are approximately 1.8 million people with T1D currently in the United States, all of whom require daily insulin replacement to manage their disease. We believe that one of the principal causes of suboptimal outcomes as it relates to disease management is the complexity of the user experience with most currently available insulin pumps and hybrid closed-loop systems, which has kept the majority of PWD from adopting them despite the improved disease management they can offer. These systems require PWD to set and to periodically adjust several insulin pump parameters, to quantify daily carbohydrate intake, and to frequently calculate proper doses of insulin for their pump to deliver. We believe this complexity, and the constant engagement that is required in order to enjoy the full therapeutic benefits that these systems can offer, limits their uptake to a subset of PWD and to subspecialty healthcare providers (HCPs). We believe that approximately one-third of people with T1D in the United States utilize insulin pumps or hybrid closed-loop systems to receive their daily insulin, while the majority receive their daily insulin via MDI, which is less complex, but often less effective, and has been shown to be associated with higher HbA1c levels. This is based on our internal estimates factoring epidemiologic data from government and leading industry organizations such as the CDC (to establish the overall size of the T1D population) and industry sales data from public filings and disclosures made by the leading device manufacturers (Medtronic, Tandem and Insulet, who collectively hold approximately 96% market share) and aggregated by third-party data service providers (to provide independent estimates of both overall device penetration of various diabetes populations). Our initial commercial results suggest that the iLet’s value proposition is resonating strongly within the MDI population as approximately 69% and 51% of the iLet’s adoption through December 31, 2024 and 2023, respectively, came from PWD who were previously utilizing MDI.

Current wording

Our initial commercialization efforts for the iLet are in type 1 diabetes (T1D), an indication for which we received FDA clearance in patients six and older in May 2023, in the United States. T1D is an autoimmune disorder that often develops during childhood or adolescence, but can occur at any age, and arises from a person’s immune system attacking and destroying the insulin-producing beta cells in the pancreas. According to the Centers for Disease Control and Prevention (CDC), there are approximately 1.9 million people with T1D currently in the United States, all of whom require daily insulin replacement to manage their disease. We believe that one of the principal causes of suboptimal outcomes as it relates to disease management is the complexity of the user experience with most currently available insulin pumps and hybrid closed-loop systems, which has kept the majority of PWD from adopting them despite the improved disease management they can offer. These systems require PWD to set and to periodically adjust several insulin pump parameters, to quantify daily carbohydrate intake, and to frequently calculate proper doses of insulin for their pump to deliver. We believe this complexity, and the constant engagement that is required in order to enjoy the full therapeutic benefits that these systems can offer, limits their uptake to a subset of PWD and to subspecialty healthcare providers (HCPs). We believe that approximately one-third of people with T1D in the United States utilize insulin pumps or hybrid closed-loop systems to receive their daily insulin, while the majority receive their daily insulin via MDI, which is less complex, but often less effective, and has been shown to be associated with higher HbA1c levels. This is based on our internal estimates factoring epidemiologic data from government and leading industry organizations such as the CDC (to establish the overall size of the T1D population) and industry sales data from public filings and disclosures made by the leading device manufacturers (Medtronic, Tandem and Insulet, who collectively hold approximately 96% market share) and aggregated by third-party data service providers (to provide independent estimates of both overall device penetration of various diabetes populations). Our initial commercial results suggest that the iLet’s value proposition is resonating strongly within the MDI population as approximately 70% and 69% of the iLet’s adoption through December 31, 2025 and 2024, respectively, came from PWD who were previously utilizing MDI.

Previous wording

We have also partnered with Dexcom and Abbott—global leaders in popular and easy to use iCGM technology—to integrate the iLet with the Dexcom G6 and G7 iCGMs and with Abbott’s FreeStyle Libre 3 Plus Continuous Glucose Monitor (CGM) sensor. A iCGM is a wearable device that works by inserting a small sensor under the skin into fatty tissue and tracks blood sugar levels in real time. The sensor measures glucose levels in the interstitial fluid and sends the information to a receiver, smartphone or insulin pump. The user can view their glucose levels, trends and to what degree their levels are rising or falling. The iCGM is a crucial component of AID systems, and by partnering with these leading global iCGM platforms, we believe we leverage all of the benefits that these CGMs offer in an elegant solution for PWD. Use of the iLet requires the independent purchase of a compatible third-party iCGM to provide real-time data to the iLet user.

Current wording

We have also partnered with Dexcom and Abbott—global leaders in popular and easy to use iCGM technology—to integrate the iLet with the Dexcom G6 and G7 iCGMs and with Abbott’s FreeStyle Libre 3 Plus Continuous Glucose Monitor (CGM) sensor. An iCGM is a wearable device that works by inserting a small sensor under the skin into fatty tissue and tracks blood sugar levels in real time. The sensor measures glucose levels in the interstitial fluid and sends the information to a receiver, smartphone or insulin pump. The user can view their glucose levels, trends and to what degree their levels are rising or falling. The iCGM is a crucial component of AID systems, and by partnering with these leading global iCGM platforms, we believe we leverage all of the benefits that these CGMs offer in an elegant solution for PWD. Use of the iLet requires the independent purchase of a compatible third-party iCGM to provide real-time data to the iLet user.

Previous wording

The durable machine equipment (DME) and pharmacy benefit plans (PBP) reimbursement channels for the iLet and its single-use products entail different payment outlays and therefore differentially impact PWD and our financial results. DME reimbursement requires the user and insurance carrier to make a large, upfront payment and reimbursement, respectively, for the iLet, which is typically in the thousands of dollars. In order to use the iLet, the user must purchase our single-use products, which are generally sold in a 30-day supply.

Current wording

The durable medical equipment (DME) and pharmacy benefit plans (PBP) reimbursement channels for the iLet and its single-use products entail different payment outlays and therefore differentially impact PWD and our financial results. DME reimbursement requires the user and insurance carrier to make a large, upfront payment and reimbursement, respectively, for the iLet, which is typically in the thousands of dollars. In order to use the iLet, the user must purchase our single-use products, which are generally sold in a 30-day supply.

Previous wording

By contrast, PBP reimbursement requires the user and insurance carrier to make a small upfront payment and reimbursement, respectively, for the iLet, allowing for a potentially higher rate of adoption by PWD. The insurance carrier then makes larger reimbursement payments for the purchase of single-use products, with the user’s payments for the single-use products being generally consistent with what the user would likely pay for single-use products in DME reimbursement. As a result, we recognize a small amount of revenue at or around the date the iLet is sold in the PBP channel and we absorb initial negative gross margin. iLet sales in the PBP channel are generally expected to then start generating cumulative positive gross margin for us following the third month the user utilizes the iLet and continues to purchase single-use products. For the years ended December 31, 2024 and December 31, 2023, PBP channel sales represented 10% and 6% of net sales, respectively.

Current wording

By contrast, PBP reimbursement requires the user and insurance carrier to make a small upfront payment and reimbursement, respectively, for the iLet, allowing for a potentially higher rate of adoption by PWD. The insurance carrier then makes larger reimbursement payments for the purchase of single-use products, with the user’s payments for the single-use products being generally consistent with what the user would likely pay for single-use products in DME reimbursement. As a result, we recognize a small amount of revenue at or around the date the iLet is sold in the PBP channel and we absorb initial negative gross margin. iLet sales in the PBP channel are generally expected to then start generating cumulative positive gross margin for us following the third month the user utilizes the iLet and continues to purchase single-use products. For the years ended December 31, 2025 and 2024, PBP channel sales represented 24% and 10% of net sales, respectively.

Previous wording

In addition to our commercialized product and to maintain our competitive position in the marketplace, we intend to continue investing in disruptive technologies through our experienced research and development team. We are in the early stages of developing an insulin pump that adheres directly to the skin and administers insulin without the need for tubing, commonly known in the diabetes industry as a “patch pump.” We are also in the early stages of developing a first-of-its-kind bihormonal configuration of the iLet, which combines automated delivery of insulin and glucagon, the BG-raising hormone that protects against low blood sugar, or hypoglycemia, with adaptive closed-loop algorithms where all doses of both hormones are autonomously determined. We also intend to pursue the development of the iLet for expanded patient populations and indications, such as people with type 2 diabetes (T2D), as we believe the size and composition of this population make it a compelling opportunity.

Current wording

In addition to our commercialized product and to maintain our competitive position in the marketplace, we intend to continue investing in disruptive technologies through our experienced research and development team. We are in the early stages of developing an insulin pump that adheres directly to the skin and administers insulin without the need for tubing, commonly known in the diabetes industry as a “patch pump.” We are also in the early stages of developing a first-of-its-kind bihormonal system of the iLet, which combines automated delivery of insulin and glucagon, the BG-raising hormone that protects against low blood sugar, or hypoglycemia, with adaptive closed-loop algorithms where all doses of both hormones are autonomously determined. As part of our development plans, in September 2025, we completed a clinical trial in Canada assessing the pharmacokinetics (PK) and pharmacodynamics (PD) of our glucagon product candidate (also referred to as the glucagon asset, and referred to herein as the PK-PD Trial). The completion of the PK-PD Trial enables us to bridge our previous bihormonal clinical data, which tested prior formulations of glucagon in three pre-pivotal inpatient and six pre-pivotal outpatient clinical trials, to our glucagon product candidate. We believe that the results from the PK-PD Trial are supportive of the continued development of our glucagon product candidate for use in our bihormonal system of the iLet. In the fourth quarter of 2025, we completed our first-in-human Phase 2a feasibility trial evaluating the integrated bihormonal system and expect to initiate an additional Phase 2a feasibility trial in the first half of 2026 as development progresses. We also intend to pursue the development of the iLet for expanded patient populations and indications, such as people with type 2 diabetes (T2D), as we believe the size and composition of this population make it a compelling opportunity.

Previous wording

In consideration for the licensed patent rights and other rights granted to us under the Control Algorithm Agreement, we issued 1,140 shares of our Class B common stock to BU, representing a specified ownership percentage on a fully diluted basis at the time of entering into the license agreement, subject to anti-dilution adjustments, which have been satisfied and extinguished by the issuance of additional shares of Class B common stock to BU. We are also required to pay BU (i) quarterly royalties of a mid-single-digit percentage based on net sales by us and our affiliates, (ii) royalties of a low double-digit percentage of net sales by sublicensees (in each case (i) and (ii), which royalties are creditable against the minimum royalty amount) and (iii) agreed to make quarterly lump sum payments of a low double-digit percentage of the non-royalty sublicensing revenue received by us from our sublicensees. The foregoing payments are subject to customary increase under certain specified circumstances. We also granted BU board observer rights and agreed to bear the patent costs, including prior patent costs incurred by BU in respect of the licensed patent rights. Additionally, if we undergo a change of control (as defined in the Control Algorithm Agreement) we will owe BU a one-time change of control payment of $65,000. We will also be required to pay BU an assignment fee to be agreed on with BU at the time of such assignment if we assign the Control Algorithm License Agreement in connection with the sale of all or substantially all of our assets relating to the licensed patent rights and copyright.

Current wording

We have the Control Algorithm license agreement with BU covering automated control system technology incorporated into the iLet. In connection with this agreement, we issued 1,140 shares of Class B common stock to BU. Under the financial terms of the agreement, we are required to pay BU (i) quarterly royalties of a mid-single-digit percentage based on net sales by us and our affiliates, (ii) quarterly royalties of a low double-digit percentage based on net sales by sublicensees, in each case of (i) and (ii) creditable against a minimum annual royalty amount, and (iii) quarterly lump-sum payments of a low double-digit percentage of certain non-royalty sublicensing revenue received from sublicensees. We are also responsible for reimbursing patent-related costs and are required to make a one-time change-of-control payment of $65,000 if such an event occurs. Royalty obligations under this agreement represent ongoing costs that are expected to increase as commercial adoption of the iLet expands.

Previous wording

In consideration for the licenses and other rights granted to us under the Collaboration and License Agreement, we paid Xeris a one-time payment of $0.5 million and a one-time milestone payment of $3.0 million for the achievement of certain development milestones, both of which are recognized as research and development expense when incurred. In addition, we are required to pay Xeris tiered royalties of low double-digit percentages based on net sales of Glucagon Products by us or our sublicensees, subject to certain customary reductions.

Current wording

We have the Collaboration and License Agreement with Xeris Pharmaceuticals, Inc. to develop and commercialize a glucagon formulation for use in our bihormonal system. Under this agreement, we paid an upfront fee of $0.5 million and a milestone payment of $3.0 million, both of which were recognized as research and development expense when incurred. We are also obligated to pay tiered royalties in the low double-digit percentage range on future net sales of glucagon products, subject to customary reductions.

Previous wording

Development and Commercialization Agreement with Abbott Diabetes Care Inc.

Current wording

We have the Commercialization Agreement and Development and Commercialization Agreement with DexCom, Inc. and Abbott Diabetes Care Inc., respectively, related to integrated automated insulin delivery systems. These agreements primarily involve shared development responsibilities and cross-licensing of technology and trademarks and do not require upfront payments, milestone payments, or ongoing royalty obligations. As a result, these arrangements have not had a material direct impact on our results of operations or cash flows to date, though they may affect future operating expenses associated with development, regulatory activities, and commercialization.

Previous wording

As a medical device company, our revenue and results of operations may be impacted by the failure to obtain adequate coverage or reimbursement for our current and future products from third-party payors, as well as changes in reimbursement structures in line with our strategy.

Current wording

As a medical device company, our revenue and results of operations may be impacted if we are unable to secure sufficient coverage or reimbursement from third-party payors for our current or future products, or if reimbursement structures change under our multi-channel strategy.

Previous wording

We are pursuing a multi-channel coverage and reimbursement strategy to maximize access to the iLet within the T1D population, provide flexibility for PWD in choosing their device and provide PWD with advantageous coverage and reimbursement terms. We are working with payors to establish coverage and reimbursement under both the DME and PBP channels as we believe this strategy increases access and optimizes the potential for better medical outcomes for PWD through the adoption of the iLet. The DME and PBP channels for the iLet and its single-use products entail different payment outlays and therefore differentially impact PWD and our financial results. When considering the overall economics over the lifetime of each iLet, sales through the DME channel generally result in higher upfront cash flows from the large, upfront payment and reimbursement for the iLet, but lead to lower cash flows over time as the user purchases the necessary single-use products. By contrast, sales through the PBP channel generally result in lower upfront cash flows from the small payment and reimbursement for the iLet, but lead to higher cash flows over time as the user purchases the necessary single-use products. This is because single- use products under the PBP channel are sold at a much higher per unit cost than under the DME. As a result of a small amount of revenue recognized at or around the date the iLet is sold in the PBP channel, we absorb initial negative gross margin. iLet sales in the PBP channel are generally expected to start generating cumulative positive gross margin for us following the third month the user utilizes the iLet and continues to purchase single-use products. For the year ended December 31, 2024 and 2023, PBP channel sales represented 10% and 6%, respectively, of net sales. When comparing sales through the DME and PBP channels, we expect sales through the PBP channel will have a more favorable economic impact on our financial results over the lifetime of the iLet. To the extent that our mix of channel reimbursement fluctuates, our financial results may vary from period to period.

Current wording

We are pursuing a multi-channel coverage and reimbursement strategy to maximize access to the iLet within the T1D population, provide flexibility for PWD in choosing their device and provide PWD with advantageous coverage and reimbursement terms. We are working with payors to establish coverage and reimbursement under both the DME and PBP channels as we believe this strategy increases access and optimizes the potential for better medical outcomes for PWD through the adoption of the iLet. The DME and PBP channels for the iLet and its single-use products entail different payment outlays and therefore differentially impact PWD and our financial results. When considering the overall economics over the lifetime of each iLet, sales through the DME channel generally result in higher upfront cash flows from the large, upfront payment and reimbursement for the iLet, but lead to lower cash flows over time as the user purchases the necessary single-use products. By contrast, sales through the PBP channel generally result in lower upfront cash flows from the small payment and reimbursement for the iLet, but lead to higher cash flows over time as the user purchases the necessary single-use products. This is because single-use products under the PBP channel are sold at a much higher per unit cost than under the DME. As a result of a small amount of revenue recognized at or around the date the iLet is sold in the PBP channel, we absorb initial negative gross margin. iLet sales in the PBP channel are generally expected to start generating cumulative positive gross margin for us following the third month the user utilizes the iLet and continues to purchase single-use products. For the year ended December 31, 2025 and 2024, PBP channel sales represented 24% and 10%, respectively, of net sales. When comparing sales through the DME and PBP channels, we expect sales through the PBP channel will have a more favorable economic impact on our financial results over the lifetime of the iLet. To the extent that our mix of channel reimbursement fluctuates, our financial results may vary from period to period.

Previous wording

The medical device industry is intensely competitive, subject to rapid change and highly sensitive to the introduction of new products, treatment techniques or technologies. We expect our business to be impacted by the introduction of new diabetes devices and treatments by us or our competitors. In order to maintain our competitive position in the marketplace, we intend, through our experienced research and development team, to continue investing in disruptive technologies, such as a patch pump and bihormonal configuration of the iLet, as well as pursuing the development of the iLet for expanded patient populations and indications such as people with T2D.

Current wording

The medical device industry is intensely competitive, subject to rapid change and highly sensitive to the introduction of new products, treatment techniques or technologies. We expect our business to be impacted by the introduction of new diabetes devices and treatments by us or our competitors. In order to maintain our competitive position in the marketplace, we intend, through our experienced research and development team, to continue investing in disruptive technologies, such as a patch pump and bihormonal system of the iLet, as well as pursuing the development of the iLet for expanded patient populations and indications such as people with T2D.

Previous wording

The medical devices we manufacture are subject to laws and regulation by numerous regulatory bodies, including the FDA. The laws and regulations govern, among other things, the research and development, design, testing, manufacture, packaging, storage, recordkeeping, approval, labeling, promotion, post-approval monitoring and reporting, distribution and import and export of medical devices. Any adverse event involving any products that we distribute could result in future corrective actions, such as recalls or customer notifications, or regulatory agency action, which could include inspection, mandatory recall or other enforcement action. In the future, we also intend to pursue additional products, such as a patch pump and bihormonal configuration of the iLet, as well as pursue the development of the iLet for expanded patient populations and indications such as people with T2D, which will increase our expenses and subject us to increased regulatory-related risks.

Current wording

The medical devices we manufacture are subject to laws and regulation by numerous regulatory bodies, including the FDA. The laws and regulations govern, among other things, the research and development, design, testing, manufacture, packaging, storage, recordkeeping, approval, labeling, promotion, post-approval monitoring and reporting, distribution and import and export of medical devices. Any adverse event involving any products that we distribute could result in future corrective actions, such as recalls or customer notifications, or regulatory agency action, which could include inspection, mandatory recall or other enforcement action. In the future, we also intend to pursue additional products, such as a patch pump and bihormonal system of the iLet, as well as pursue the development of the iLet for expanded patient populations and indications such as people with T2D, which will increase our expenses and subject us to increased regulatory-related risks.

Previous wording

Our costs are subject to fluctuation, and we continue to evaluate contributing factors, specifically those leading to inflationary cost increases in logistics, price of raw materials (components of the iLet), cost of labor, transportation and operating supplies. While we are experiencing higher raw material, labor, transportation, and operating supply costs, we intend to continue to work to improve productivity to help offset these costs as we navigate these global macroeconomic challenges.

Current wording

Our costs are subject to fluctuation, and we continue to evaluate contributing factors, specifically those leading to inflationary cost increases in logistics, price of raw materials (components of the iLet), cost of labor, transportation and operating supplies. While we are experiencing higher raw material, labor, transportation, and operating supply costs, we intend to continue to work to improve productivity to help offset these costs as we navigate these global macroeconomic challenges, including tariffs or other trade measures, future bank failures, increased geopolitical tensions and conflicts, global pandemics, global economic conditions, including changes in monetary and fiscal policy, U.S. political developments and other sources of instability.

Previous wording

Cost of sales includes raw materials, labor costs, manufacturing overhead expenses, royalties, freight, import tariffs, scrap and reserves for expected warranty costs and excess and obsolete inventory. Manufacturing overhead expenses include expenses relating to manufacturing engineering, material procurement, inventory and quality control, facilities, depreciation, amortization, information technology and operations supervision and management.

Current wording

Cost of sales includes raw materials, labor costs, manufacturing overhead expenses, royalties, freight, import tariffs, scrap and reserves for expected warranty costs and excess and obsolete inventory. Manufacturing overhead expenses include expenses relating to manufacturing engineering, material procurement, inventory and quality control, facilities, depreciation, information technology and operations supervision and management.

Previous wording

Our research and development expenses primarily consist of engineering and research expenses related to the iLet clinical trials, regulatory expenses and personnel-related expenses, such as salaries, bonuses, stock-based compensation expense and benefits for our employees in the research and development function. We also incur research and development expenses for payments made under third-party licensing agreements, supplies, development prototypes, outside design and testing services, depreciation, allocated facilities and information services, clinical trial costs, and other indirect costs. We expense research and development costs as incurred. We do not track research and development expenses by individual product candidate.

Current wording

Our research and development expenses include engineering and clinical trial activities for the iLet, regulatory efforts, personnel costs such as salaries, bonuses, stock-based compensation and benefits, payments under third-party license agreements, supplies, development prototypes, design and testing services, depreciation and allocated facilities and information technology expenses, all of which are expensed as incurred. We track research and development expenses by individual product candidate. We expect research and development expenses to increase significantly for the foreseeable future as we advance clinical development, pursue new products and indications including the bihormonal system, patch pump, and potential T2D use, expand technical and operational staffing, make required payments under license arrangements, and establish commercial scale manufacturing capabilities.

Previous wording

We are in the early commercialization stages of the iLet and are focused on driving awareness and adoption among new customers. Sales and marketing expenses are primarily related to the market development and post-commercial launch activities for the iLet, including the design of infrastructure to support the customer experience, and marketing and branding strategy. Market development and post-commercial launch activities account for a significant portion of our overall operating expenses and are expensed as they are incurred. We anticipate a significant increase in sales and marketing expenses for the foreseeable future to support the continued commercialization of the iLet.

Current wording

We are in the early commercialization stages of the iLet and are focused on driving awareness and adoption among new customers. Sales and marketing expenses primarily include personnel costs for our sales and clinical teams, the development of customer support infrastructure, marketing and branding activities, healthcare conference and market research costs, payer education and market access initiatives, data purchases, website and consulting fees, and facilities, travel, and other related operating expenses. We anticipate a significant increase in sales and marketing expenses for the foreseeable future to support the continued commercialization of the iLet and our future products.

Previous wording

General and administrative expenses primarily consist of personnel-related costs, including salaries, bonuses, stock-based compensation expense and benefits for our personnel in executive, legal, finance and accounting, human resources, information technology, quality assurance and other administrative roles. We additionally incur expenses related to patent filings, legal fees for patent and corporate matters, as well as other professional fees for accounting, auditing, consulting and tax services. Other expenses include insurance, travel, facilities, depreciation and other expenses not otherwise included in research and development or sales and marketing expenses. We anticipate a significant increase in general and administrative expenses for the foreseeable future due to additional costs associated with operating as a public company. These include increased expenses for professional services, director and officer insurance, investor and public relations and compliance with U.S. Securities and Exchange Commission (SEC) rules and regulations and exchange listing standards.

Current wording

General and administrative expenses include personnel-related costs, including salaries, bonuses, stock-based compensation expense and benefits for our personnel in executive, legal, finance, accounting, human resources, information technology, quality assurance and other administrative functions, as well as expenses for patent filings, legal services, accounting and tax services, insurance, travel, facilities and depreciation. We expect these expenses to increase significantly as we continue operating as a public company, driven by higher professional services costs, director and officer insurance, investor and public relations activities and compliance with SEC and stock exchange listing requirements. We anticipate a significant increase in general and administrative expenses for the foreseeable future in order to continue to scale the business and support future demand.

Previous wording

Our other income (expense) consists of (i) interest income, (ii) other expense and (iii) change in fair value of warrant liabilities.

Current wording

Our other income (expense) consists of (i) interest income, (ii) other income (expense) and (iii) change in fair value of warrant liabilities.

Previous wording

Interest income consists of cash interest earned on our cash, cash equivalents and short-term investment balances.

Current wording

Interest income consists of cash interest earned on our cash, cash equivalents and short-term and long-term investment balances.

Previous wording

Other expense consists of miscellaneous expenses unrelated to our core operations.

Current wording

Other income (expense) consists of miscellaneous income and expenses unrelated to our core operations.

Previous wording

In connection with our February 2022 Series C preferred stock financing, we granted warrants (Series C Warrants) to certain investors to purchase additional shares of our Series C convertible preferred stock. In connection with our August 2023 Series D preferred stock financing, we granted warrants to certain investors to purchase shares of our Class B common stock (Class B Warrants, and together with the Series C Warrants, the Warrants). These Warrants were classified as liabilities on our balance sheet and initially recorded at fair value on the grant date. They are subsequently remeasured to fair value at the end of each reporting period, with changes in the fair value recognized as a component of other income (expense), net. We will continue to recognize changes in fair value of the warrant liabilities until the Warrants are exercised, expire, or qualify for equity classification. The Warrants were exercised prior to the completion of our initial public offering and are no longer be outstanding. For additional information, see Part II. Item 8. Note 4 of our audited financial statements included elsewhere in this Annual Report.

Current wording

In connection with our February 2022 Series C preferred stock financing, we granted warrants (Series C Warrants) to certain investors to purchase additional shares of our Series C convertible preferred stock. In connection with our August 2023 Series D preferred stock financing, we granted warrants to certain investors to purchase shares of our Class B common stock (Class B Warrants, and together with the Series C Warrants, the Warrants). These Warrants were classified as liabilities on our balance sheet and initially recorded at fair value on the grant date. They are subsequently remeasured to fair value at the end of each reporting period through their exercise in January 2025. Changes in the fair value were recognized as a component of other income (expense), net. We continued to recognize changes in fair value of the warrant liabilities until the Warrants were exercised prior to the completion of our IPO. The Warrants are no longer outstanding. For additional information, see Part II. Item 8. Note 4 of our audited financial statements included elsewhere in this Annual Report.

Previous wording

Research and development expenses were $26.2 million for the year ended December 31, 2024, compared to $17.9 million during the year ended December 31, 2023. This increase of $8.3 million was primarily attributable to a $3.5 million in Xeris milestone payments and $2.2 million in engineering, materials, and third-party consulting costs incurred from the development of our patch pump, bihormonal configuration of the iLet and incremental software and product updates. The remaining increase is attributable to a net increase of $2.8 million in payroll-related expenses driven by an increase in R&D personnel headcount offset by a decrease of $0.2 million in facilities-related overhead.

Current wording

Research and development expenses for the year ended December 31, 2025 were $34.8 million, compared to $26.2 million during the year ended December 31, 2024. This increase of $8.6 million was primarily attributable to a net increase of $5.4 million in payroll-related expenses, including stock-based compensation, driven by an increase in headcount focused on supporting our innovation activities. The remaining increase is attributable to materials and clinical trial related expenses incurred for the development of our patch pump, bihormonal system of the iLet and incremental software and product updates.

Previous wording

Sales and marketing expenses were $37.1 million for the year ended December 31, 2024, compared to $12.0 million for the year ended December 31, 2023. This increase of $25.1 million was primarily attributable to an increase of $17.4 million in payroll-related costs, including salaries and wages, sales incentive bonuses, and stock-based compensation, due to an increase in headcount of our sales force and customer care team in connection with the post-commercial launch of the iLet in the United States. The remaining increase includes $7.7 million in HCP-related marketing, training and professional education and facilities-related expenses.

Current wording

Sales and marketing expenses for the year ended December 31, 2025 were $61.4 million, compared to $37.1 million for the year ended December 31, 2024. This increase of $24.3 million was primarily attributable to an increase of $16.3 million in payroll-related expenses, including salaries and wages, sales incentive bonuses, and stock-based compensation, due to an increase in headcount of our sales force and customer care team in connection with the expansion of our sales territories within the United States. The remaining increase includes HCP-related marketing, training and travel-related expenses attributable to our continued efforts to grow our install base and support sales expansion.

Previous wording

Total other expense, net was $9.5 million for the year ended December 31, 2024, compared to $8.2 million for the year ended December 31, 2023. This increase of $1.3 million was attributable to a $3.4 million increase in expense from the change in fair value of our warrant liabilities due to changes in inputs associated with the Black-Scholes calculations used to determine the fair value of our warrant liabilities as of December 31, 2024. This was partially offset by a $2.1 million increase in interest income from our short-term investments.

Current wording

Total other expense, net for the year ended December 31, 2025 was $1.5 million, compared to $9.5 million for the year ended December 31, 2024. This decrease of $8.0 million was attributable to a $7.0 million increase in interest income from our short-term and long-term investments due to the investment of our IPO proceeds during the first quarter of 2025 as well as a $1.0 million decrease in expense from the change in fair value of our warrant liabilities due to changes in inputs associated with the fair value measurement immediately prior to our IPO compared to December 31, 2024.

Previous wording

The following table sets forth our selected unaudited quarterly consolidated statements of operations data for each of the eight quarters in the period ended December 31, 2024. The information for each of these quarters has been prepared in accordance with GAAP, on a basis consistent with our audited consolidated financial statements included elsewhere in this Annual Report and include, in our opinion, all normal recurring adjustments necessary for the fair presentation of the results of operations for the periods presented, with the exception of Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), which is a non-GAAP financial measure discussed below. Our historical quarterly results are not necessarily indicative of the results that may be expected in the future and these quarterly results are not necessarily indicative of our operating results for a full year. The following quarterly financial information should be read in conjunction with our consolidated financial statements and related notes thereto included elsewhere in this Annual Report.

Current wording

The following table sets forth our selected unaudited quarterly consolidated statements of operations data for each of the eight quarters in the period ended December 31, 2025. The information for each of these quarters has been prepared in accordance with generally accepted accounting principles in the United States (GAAP), on a basis consistent with our audited consolidated financial statements included elsewhere in this Annual Report and include, in our opinion, all normal recurring adjustments necessary for the fair presentation of the results of operations for the periods presented, with the exception of Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), which is a non-GAAP financial measure discussed below. Our historical quarterly results are not necessarily indicative of the results that may be expected in the future and these quarterly results are not necessarily indicative of our operating results for a full year. The following quarterly financial information should be read in conjunction with our consolidated financial statements and related notes thereto included elsewhere in this Annual Report.

Previous wording

In addition to our financial results determined in accordance with generally accepted accounting principles in the United States (GAAP), we believe the following adjusted EBITDA non-GAAP measure is useful in evaluating our operating performance. We use adjusted EBITDA to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that this non-GAAP financial measure, when taken together with the corresponding GAAP financial measures, provide meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our business, results of operations, or outlook. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison. A reconciliation is provided below for adjusted EBITDA to the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review the related GAAP financial measures and the reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure, and not to rely on any single financial measure to evaluate our business.

Current wording

In addition to our financial results determined in accordance with GAAP, we believe the following adjusted EBITDA non-GAAP measure is useful in evaluating our operating performance. We use adjusted EBITDA to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that this non-GAAP financial measure, when taken together with the corresponding GAAP financial measures, provide meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our business, results of operations, or outlook. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison. A reconciliation is provided below for adjusted EBITDA to the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review the related GAAP financial measures and the reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure, and not to rely on any single financial measure to evaluate our business.

Previous wording

We calculate adjusted EBITDA as net loss adjusted to exclude (i) depreciation and amortization expense, (ii) stock-based compensation expense, (iii) interest income, (iv) provision for state taxes and (v) change in fair value of warrant liabilities.

Current wording

We calculate adjusted EBITDA as net loss adjusted to exclude (i) depreciation expense, (ii) stock-based compensation expense, (iii) interest income, (iv) income tax expense (benefit), (v) litigation settlement and other related expense, and (vi) change in fair value of warrant liabilities.

Previous wording

Some of the limitations of adjusted EBITDA include: (i) adjusted EBITDA does not properly reflect capital commitments to be paid in the future and (ii) although depreciation and amortization expense are non-cash charges, the underlying assets may need to be replaced and adjusted EBITDA does not reflect these capital expenditures. Our adjusted EBITDA may not be comparable to similarly titled measures of other companies because they may not calculate adjusted EBITDA in the same manner as we calculate the measure, limiting its usefulness as a comparative measure. In evaluating adjusted EBITDA, you should be aware that in the future we will incur expenses similar to the adjustments in this presentation. Our presentation of adjusted EBITDA should not be construed as an inference that our future results will be unaffected by these expenses or any unusual or non-recurring items. When evaluating our performance, you should consider adjusted EBITDA alongside other financial performance measures, including our net loss and other GAAP results.

Current wording

Some of the limitations of adjusted EBITDA include: (i) adjusted EBITDA does not properly reflect capital commitments to be paid in the future and (ii) although depreciation expense includes non-cash charges, the underlying assets may need to be replaced and adjusted EBITDA does not reflect these capital expenditures. Our adjusted EBITDA may not be comparable to similarly titled measures of other companies because they may not calculate adjusted EBITDA in the same manner as we calculate the measure, limiting its usefulness as a comparative measure. In evaluating adjusted EBITDA, you should be aware that in the future we will incur expenses similar to the adjustments in this presentation. Our presentation of adjusted EBITDA should not be construed as an inference that our future results will be unaffected by these expenses or any unusual or non-recurring items. When evaluating our performance, you should consider adjusted EBITDA alongside other financial performance measures, including our net loss and other GAAP results.

Previous wording

Our quarterly research and development expenses increased in all periods presented, except the second quarter of 2023 and third quarter of 2024, primarily due to increases in engineering, third-party consulting costs and payroll-related expenses incurred to support our continued research and development efforts to enhance our existing product and develop new products.

Current wording

Our quarterly research and development expenses increased in all periods presented, except the third quarters of 2024 and 2025 and the first quarter of 2025, primarily due to increases in payroll-related expenses, materials and clinical trial related expenses incurred to support our continued research and development efforts to enhance our existing product and develop new products.

Previous wording

Our general and administrative expenses increased in all periods presented, except the third quarter of 2023, primarily due to increases in payroll-related expenses driven by headcount increases in our quality assurance team, as well as expenses incurred for operational overhead expenses to meet the growing demand for the iLet.

Current wording

Our general and administrative expenses increased in all periods presented, except the fourth quarter of 2024, primarily due to increases in payroll-related expenses driven by headcount increases in our quality assurance team, and public company costs, including accounting and audit services, insurance premiums and legal expenses, as well as expenses incurred for operational overhead expenses to meet the growing demand for the iLet.

Previous wording

Our quarterly Adjusted EBITDA increased from the first quarter 2023 to the fourth quarter of 2023 primarily due to an increase in Net Sales and Gross Profit. Our quarterly Adjusted EBITDA decreased from the fourth quarter of 2023 to the fourth quarter of 2024 primarily due to increases in Sales & Marketing and Research & Development expenses. The decrease in Adjusted EBITDA from the third quarter of 2024 to the fourth quarter of 2024 was primarily driven by a $3.0 million milestone payment made to Xeris in the fourth quarter of 2024 for the achievement of certain developmental milestones.

Current wording

Adjusted EBITDA improved from the first quarter of 2025 to the fourth quarter of 2025 due to higher revenue, improved margins, and increased operating leverage despite continued headcount increases. The decline from the third quarter of 2024 to the first quarter of 2025 was primarily driven by product mix, lower volume due to seasonal factors as well as a $3.0 million milestone payment made to Xeris in the fourth quarter of 2024 for the achievement of certain developmental milestones. Adjusted EBITDA improved from the second quarter of 2024 to the third quarter of 2024 due to favorable timing of research and development expenses. Adjusted EBITDA declined from the first quarter of 2024 to the second quarter of 2024 primarily due to increases in sales and marketing and research and development expenses.

Previous wording

We regularly review the following key business metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections and make strategic decisions. We believe that the following metrics are representative of our current business:

Current wording

We regularly review the following key business metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections and make strategic decisions, although we may change our key business metrics or how we present our key business metrics from time to time.

Previous wording

In the year ended December 31, 2023, a mid-single digit percentage of our new patient starts were reimbursed through the PBP channel. In the year ended December 31, 2024 a high-single digit percentage of our new patient starts were reimbursed through the PBP channel. In the fourth quarter of 2024, a low-teens percentage of our new patient starts were reimbursed through the PBP channel.

Current wording

In the year ended December 31, 2025, a high-twenties percentage of our new patient starts were reimbursed through the PBP channel. In the year ended December 31, 2024, a high-single digit percentage of our new patient starts were reimbursed through the PBP channel. The increase in new patient starts through the PBP channel reflects enhanced formulary access and broader pharmacy coverage for iLet. These improvements are primarily attributable to the execution of contracts with key PBMs.

Previous wording

Since our inception, we have incurred significant operating losses. To date, research and development, market development and commercial launch activities have accounted for a significant portion of our overall operating expenses. We expect to incur significant expenses and operating losses for the foreseeable future as we advance the commercialization of our iLet, including future development of the patch pump and bihormonal configuration of the iLet.

Current wording

Since our inception, we have incurred significant operating losses. To date, research and development, market development and commercial launch activities have accounted for a significant portion of our overall operating expenses. We expect to incur significant expenses and operating losses for the foreseeable future as we advance the commercialization of our iLet, including future development of the patch pump and bihormonal system of the iLet.

Previous wording

To date, we have funded our operations primarily with proceeds from the sale of our convertible preferred stock, raising an aggregate of approximately $356.6 million of gross proceeds, including net proceeds of approximately $101.7 million from the issuance and sale of our Series D convertible preferred stock in August 2023 and approximately $59.7 million from the issuance and sale of our Series E convertible preferred stock in November 2024. In January 2025, we completed our initial public offering and a concurrent private placement, pursuant to which we received aggregate net proceeds of approximately $190.4 million and approximately $15.6 million, respectively, in each case after deducting underwriting discounts, commissions, and other offering expenses. We have also received payments in connection with collaboration agreements and government grants, receiving $6.1 million to date from these types of arrangements, as well as from the sale of the iLet and single-use products utilized with the iLet from our contracts with customers. As of December 31, 2024, we had cash and cash equivalents and short-term investments of $103.6 million.

Current wording

To date, we have funded our operations primarily with proceeds from the sale of our convertible preferred stock, raising an aggregate of approximately $356.6 million of gross proceeds, including net proceeds of approximately $101.7 million from the issuance and sale of our Series D convertible preferred stock in August 2023 and approximately $59.7 million from the issuance and sale of our Series E convertible preferred stock in November 2024. In January 2025, we completed our IPO and a concurrent private placement, pursuant to which we received aggregate net proceeds of approximately $190.4 million and approximately $15.6 million, respectively, in each case after deducting underwriting discounts, commissions, and other offering expenses. We have also received payments in connection with collaboration agreements and government grants, receiving $6.1 million to date from these types of arrangements, as well as from the sale of the iLet and single-use products utilized with the iLet from our contracts with customers. As of December 31, 2025, we had cash and cash equivalents and short-term and long-term investments of $264.7 million.

Previous wording

During the year ended December 31, 2024, net cash provided by investing activities was $3.5 million, primarily attributable to a $72.0 million in proceeds from maturities and redemptions of short-term investments, offset by $72.1 million in purchases of short-term investments as well as $3.4 million in additional investment in property and equipment for additional manufacturing equipment.

Current wording

Net cash used in investing activities increased to $162.8 million for the year ended December 31, 2025 compared to $3.5 million for the year ended December 31, 2024. The increase in net cash used in investing activities was primarily driven by the investment of net proceeds from our IPO in January 2025. The Company used $282.0 million in purchases of short-term investments and $45.5 million in purchases of long-term investments during 2025, partially offset by $170.0 million in proceeds from maturities and redemptions of short-term investments. Capital expenditures increased modestly to $5.3 million in 2025 compared to $3.4 million in 2024, reflecting continued investment in property and equipment for additional manufacturing equipment to support commercial growth.

Previous wording

During the year ended December 31, 2024, net cash provided by financing activities was $55.6 million, primarily attributable to the net proceeds of $59.7 million from the issuance and sale of shares of our Series E convertible preferred stock, offset by $4.1 million in payments of deferred offering costs associated with the initial public offering (IPO).

Current wording

Net cash provided by financing activities was $214.9 million for the year ended December 31, 2025 compared to $55.6 million for the year ended December 31, 2024. The increase in net cash provided by financing activities was primarily driven by the completion of the Company’s IPO in January 2025. During 2025, financing activities primarily consisted of $195.4 million in net proceeds from the IPO, $15.6 million in proceeds from the private placement, and $4.8 million from stock option exercises. By comparison, financing activities in 2024 primarily consisted of $59.7 million from the issuance and sale of shares of our Series E convertible preferred stock, offset by $4.1 million in payments of deferred offering costs associated with our IPO.

Previous wording

the cost of obtaining and maintaining FDA marketing authorization or clearance for other future indications or other product candidates, including for the iLet for T1D using both insulin and glucagon (a bihormonal configuration), the iLet for T2D and the patch pump;

Current wording

the cost of obtaining and maintaining FDA marketing authorization or clearance for other future indications or other product candidates, including for the iLet for T1D using both insulin and glucagon (a bihormonal system), the iLet for T2D and the patch pump;