Vericel Corp

Previous wording

We have a cell manufacturing facility in Cambridge, Massachusetts, which is currently used for U.S. manufacturing and distribution of MACI and Epicel. In January 2022, we entered into a lease agreement (as amended, the “Burlington Lease”) to lease approximately 126,000 square feet of manufacturing, laboratory and office space in Burlington, Massachusetts. The Burlington facility is complete, and we are currently utilizing the facility’s office space. In March 2026, we received FDA approval to begin MACI commercial manufacturing at the Burlington facility and the Company has begun transitioning the facility’s manufacturing component into the primary manufacturing facility for MACI. We intend that the Burlington facility’s manufacturing component will eventually also become the primary manufacturing facility for Epicel, upon FDA qualification for Epicel manufacturing.

Current wording

We have a cell manufacturing facility in Cambridge, Massachusetts, which is currently used for U.S. manufacturing and distribution of MACI and Epicel. In January 2022, we entered into a lease agreement (as amended, the “Burlington Lease”) to lease approximately 126,000 square feet of manufacturing, laboratory and office space in Burlington, Massachusetts. The Burlington facility is complete, and we are currently utilizing the facility’s office space. In March 2026, we received FDA approval to begin MACI commercial manufacturing at the Burlington facility and we are currently transitioning the facility’s manufacturing component into the primary manufacturing facility for MACI, and have begun manufacturing a portion of MACI implants at that location. We intend that the Burlington facility’s manufacturing component will eventually also become the primary manufacturing facility for Epicel, upon FDA qualification for Epicel manufacturing.

Previous wording

Epicel is a permanent skin replacement indicated for the treatment of adult and pediatric patients with deep-dermal or full-thickness burns comprising greater than or equal to 30 percent of a patient’s TBSA. Both autologous cell therapy products, MACI and Epicel, are currently manufactured and marketed in the U.S. NexoBrid is a topically-administered biological orphan product containing proteolytic enzymes that is indicated for eschar removal in adult and pediatric patients with deep partial-thickness and/or full-thickness thermal burns. We hold exclusive license and supply agreements with MediWound to commercialize NexoBrid in North America. The Company operates its business primarily in the U.S. in one reportable segment - the research, product development, manufacture and distribution of cellular therapies and specialty biologics for use in the treatment of specific conditions.

Current wording

Epicel is a permanent skin replacement indicated for the treatment of adult and pediatric patients with deep-dermal or full-thickness burns comprising greater than or equal to 30 percent of a patient’s TBSA. Both autologous cell therapy products, MACI and Epicel, are currently manufactured and marketed in the U.S. NexoBrid is a topically-administered biological orphan product containing proteolytic enzymes that is indicated for eschar removal in adult and pediatric patients with deep partial-thickness and/or full-thickness thermal burns. We hold exclusive license and supply agreements with MediWound to commercialize NexoBrid in North America. We operate our business primarily in the U.S. in one reportable segment - the research, product development, manufacture and distribution of cellular therapies and specialty biologics for use in the treatment of specific conditions.

Previous wording

In August 2024, the FDA approved a supplemental Biologics License Application (“sBLA”) expanding the MACI indication to add instructions for the arthroscopic delivery of MACI to the product’s approved labeling, permitting the repair of single or multiple full-thickness cartilage defects of the knee up to 4 cm 2 in size via an arthroscopic approach. MACI Arthro provides a less invasive technique compared to the open arthrotomy approach and allows surgeons to evaluate, prepare and treat the cartilage defect, and deliver the MACI implant, under direct arthroscopic visualization and, should the surgeon so choose, to use specialized and custom-designed instruments (the “MACI Arthro instruments”) through small incisions or portals. The arthroscopic delivery of MACI may increase the ease of MACI’s use for physicians and may reduce both the length of the procedure as well as procedure-induced trauma, which may result in a reduction of a patient’s post-operative pain and accelerate a patient’s recovery. MACI Arthro became commercially available in the U.S. during the third quarter of 2024 and we began selling MACI Arthro instruments at that time. We have experienced strong surgeon interest in the MACI Arthro technique since its launch. To date, more than 900 surgeons have participated in Company-sponsored education and training programs concerning the arthroscopic approach. We believe that the availability of MACI Arthro provides a significant growth opportunity for the overall MACI business, as we have already seen a significant increase in both MACI biopsies and implants from those surgeons who have engaged in MACI Arthro training and education programs. In conjunction with the launch of MACI Arthro, we have expanded our target surgeon base from 5,000 to 7,000 to include orthopedic surgeons that perform high volumes of knee cartilage repair surgeries, predominantly through arthroscopic procedures.

Current wording

MACI consists of autologous cultured chondrocytes, which are human-derived cells that are obtained from the patient’s own cartilage, and which are seeded onto a resorbable Type I/III collagen membrane. Since MACI’s commercial launch, the product’s FDA-approved labeling has provided for a treating surgeon to use MACI to treat a patient through an open surgical procedure. In August 2024, the FDA approved a supplemental Biologics License Application (“sBLA”) expanding the MACI indication to add instructions for the arthroscopic delivery of MACI to the product’s approved labeling, permitting the repair of single or multiple full-thickness cartilage defects of the knee up to 4 cm 2 in size via an arthroscopic approach. MACI Arthro provides a less invasive technique compared to the open arthrotomy approach and allows surgeons to evaluate, prepare and treat the cartilage defect, and deliver the MACI implant, under direct arthroscopic visualization and, should the surgeon so choose, to use specialized and custom-designed instruments (the “MACI Arthro instruments”) through small incisions or portals. The arthroscopic delivery of MACI may increase the ease of MACI’s use for physicians and may reduce both the length of the procedure as well as procedure-induced trauma, which may result in a reduction of a patient’s post-operative pain and accelerate a patient’s recovery. MACI Arthro became commercially available in the U.S. during the third quarter of 2024, and we began selling MACI Arthro instruments at that time. We have experienced strong surgeon interest in the MACI Arthro technique since its launch, and we believe that the availability of MACI Arthro provides a significant growth opportunity for the overall MACI business. In conjunction with the launch of MACI Arthro, we have expanded our target surgeon base from 5,000 to 7,000 to include orthopedic surgeons that perform high volumes of knee cartilage repair surgeries, predominantly through arthroscopic procedures.

Previous wording

Total revenue increase for the three months ended March 31, 2026, compared to the same period in 2025, was driven primarily by MACI and Epicel volume and price growth, partially offset by lower NexoBrid volume.

Current wording

Total revenue increase for the three and six months ended June 30, 2026, compared to the same periods in 2025, was driven primarily by MACI and Epicel volume and price growth.

Previous wording

Sales of MACI implants have historically experienced a level of seasonality throughout the year. In the last five years through 2025, MACI sales volumes from the first through the fourth quarter on average represented 21% (20%-22% range), 23% (22%-24% range), 22% (21%-24% range) and 34% (33%-34% range) respectively, of total annual volumes. Historically,

Current wording

Sales of MACI implants have historically experienced a level of seasonality throughout the year. In the last five years through 2025, MACI sales volumes from the first through the fourth quarter on average represented 21% (20%-22% range), 23% (22%-24% range), 22% (21%-24% range) and 34% (33%-34% range) respectively, of total annual volumes. Historically, MACI orders are normally stronger in the fourth quarter due to several factors including the satisfaction by patients of insurance deductible limits and the time of year patients prefer to start rehabilitation. Due to the low incidence and variable occurrence of severe burns, Epicel has inherent variability from quarter-to-quarter and does not exhibit significant seasonality.

Previous wording

Gross profit increased for the three months ended March 31, 2026, compared to the same period in 2025, primarily driven by MACI and Epicel revenue growth combined with our primarily fixed manufacturing cost structure, which consists mainly of labor and facility costs.

Current wording

Gross profit increased for the three and six months ended June 30, 2026, compared to the same periods in 2025, primarily driven by MACI and Epicel revenue growth combined with our primarily fixed manufacturing cost structure, which consists mainly of labor and facility costs.

Previous wording

Research and development expenses for the three months ended March 31, 2026 were $8.1 million, compared to $7.3 million for the same period in 2025. The increase is primarily due to higher headcount and employee expenses.

Current wording

Research and development expenses for the three and six months ended June 30, 2026 were $7.5 million and $15.6 million, respectively, compared to $6.7 million and $14.0 million, respectively, for the same periods in 2025. The increase is primarily due to higher headcount and employee expenses, regulatory support for potential MACI launch in the United Kingdom and MACI MASCOT trial spend.

Previous wording

Selling, general and administrative expenses for the three months ended March 31, 2026 were $49.2 million, compared to $41.8 million for the same period in 2025. The increase in selling, general and administrative expenses is primarily due to higher headcount and employee expenses, including the MACI sales force expansion, and facility costs for the new facility in Burlington, Massachusetts.

Current wording

Selling, general and administrative expenses for the three and six months ended June 30, 2026 were $48.5 million and $97.7 million, respectively, compared to $41.9 million and $83.7 million, respectively, for the same periods in 2025. The increase in selling, general and administrative expenses for the three and six months ended June 30, 2026 is primarily due to higher headcount and employee expenses, including the MACI sales force expansion, and an increase in marketing programs. Higher facility costs with respect to the new facility in Burlington, Massachusetts also contributed to the increase in selling, general and administrative expenses for the six months ended June 30, 2026.

Previous wording

The increase in total other income for the three months ended March 31, 2026, compared to the same period in 2025 was due to an increase in interest income, which was primarily due to fluctuations in the rates of return on our investments in various marketable debt securities and money market funds.

Current wording

The increase in total other income for the three and six months ended June 30, 2026, compared to the same periods in 2025 was due to an increase in interest income, which was primarily due to fluctuations in the balances and rates of return on our investments in various marketable debt securities and money market funds.

Previous wording

The decrease in stock-based compensation expense for the three months ended March 31, 2026, compared to the same period in 2025, was due primarily to fluctuations in stock prices and the mix of service-based options and restricted stock units, which impacts the fair value of the options and restricted stock units awarded and the expense recognized in the period.

Current wording

The decrease in stock-based compensation expense for the three and six months ended June 30, 2026, compared to the same periods in 2025, was due primarily to fluctuations in stock prices and the mix of service-based options and restricted stock units, which impacts the fair value of the options and restricted stock units awarded and the expense recognized in the period.

Previous wording

Our cash and cash equivalents totaled $109.3 million, short-term investments totaled $36.0 million and long-term investments totaled $65.3 million as of March 31, 2026. The $16.4 million of cash provided by operations during the three months ended March 31, 2026 was primarily the result of non-cash charges of $11.3 million related to stock-based compensation expense, $3.3 million in depreciation and amortization expense, $1.4 million of operating lease amortization and a net increase of $6.5 million related to movements in our working capital accounts, partially offset by a net loss of $6.3 million. The overall increase in cash from our working capital accounts was primarily driven by a decrease in accounts receivable due to cash collections, partially offset by a decrease in accrued expenses due to timing of payments.

Current wording

Our cash and cash equivalents totaled $125.4 million, short-term investments totaled $37.1 million and long-term investments totaled $65.0 million as of June 30, 2026. The $32.6 million of cash provided by operations during the six months ended June 30, 2026 was primarily the result of non-cash charges of $20.4 million related to stock-based compensation expense, $6.9 million in depreciation and amortization expense, $2.8 million of operating lease amortization and a net increase of $6.2 million related to movements in our working capital accounts, partially offset by a net loss of $4.1 million. The overall increase in cash from our working capital accounts was primarily driven by a decrease in accounts receivable due to cash collections and an increase in accounts payable due to timing of payments, partially offset by payments on operating leases.

Previous wording

Our cash, cash equivalents and restricted cash totaled $79.7 million, short-term investments totaled $39.4 million and long-term investments totaled $43.3 million as of March 31, 2025. The $6.6 million of cash provided by operations during the three months ended March 31, 2025 was primarily the result of non-cash charges of $11.5 million related to stock-based compensation expense, $2.7 million in depreciation and amortization expense and $1.4 million of operating lease amortization, partially offset by a net loss of $11.2 million and a net increase of $1.4 million related to movements in our working capital accounts. The overall increase in cash from our working capital accounts was primarily driven by a decrease in accounts receivable due to cash collections and receipts of tenant improvement allowances which exceeded payments on operating leases amortization, offset by a decrease in accounts payable and accrued expenses due to timing of payments.

Current wording

Our cash and cash equivalents totaled $80.5 million, short-term investments totaled $36.3 million and long-term investments totaled $47.4 million as of June 30, 2025. The $14.8 million of cash provided by operations during the six months ended June 30, 2025 was primarily the result of non-cash charges of $21.6 million related to stock-based compensation expense, $5.5 million in depreciation and amortization expense and $2.7 million of operating lease amortization, partially offset by a net loss of $11.8 million and a net decrease of $4.0 million related to movements in our working capital accounts. The overall decrease in cash from our working capital accounts was primarily driven by an increase in accounts receivable due to higher sales volume, as well as a decrease in accounts payable and accrued expenses due to timing of payments.

Previous wording

Net cash used in investing activities during the three months ended March 31, 2026 was the result of $17.2 million in investment purchases and $1.3 million of property and equipment purchases primarily for construction in process, partially offset by $14.2 million of investment sales and maturities.

Current wording

Net cash used in investing activities during the six months ended June 30, 2026 was the result of $29.0 million in investment purchases and $3.2 million of property and equipment purchases primarily for construction in process, partially offset by $25.2 million of investment sales and maturities.

Previous wording

Net cash used in investing activities during the three months ended March 31, 2025 was the result of $14.2 million of property and equipment purchases primarily for construction in process related to the Burlington Lease and $13.4 million in investment purchases, partially offset by $12.5 million of investment sales and maturities.

Current wording

Net cash used in investing activities during the six months ended June 30, 2025 was the result of $22.3 million of property and equipment purchases primarily for construction in process related to the Burlington Lease and $29.0 million in investment purchases, partially offset by $27.2 million of investment sales and maturities.

Previous wording

Net cash used in financing activities during the three months ended March 31, 2026 was the result ofpayment of employee withholding taxes related to the vesting of restricted stock units of $4.5 million, partially offset by thenet proceeds from the exercise of stock options and the employee stock purchase plan of $1.6 million.

Current wording

Net cash used in financing activities during the six months ended June 30, 2026 was the result ofpayment of employee withholding taxes related to the vesting of restricted stock units of $4.7 million, partially offset by thenet proceeds from the exercise of stock options and the employee stock purchase plan of $4.4 million.

Previous wording

Net cash provided by financing activities during the three months ended March 31, 2025 was the result of net proceeds from the exercise of stock options and the employee stock purchase plan of $9.4 million, partially offset by the payment of employee withholding taxes related to the vesting of restricted stock units of $6.2 million.

Current wording

Net cash provided by financing activities during the six months ended June 30, 2025 was the result of net proceeds from the exercise of stock options and the employee stock purchase plan of $11.2 million, partially offset by the payment of employee withholding taxes related to the vesting of restricted stock units of $6.3 million.

Previous wording

There have been no material changes to our critical accounting policies and estimates in the three months ended March 31, 2026. For further information, refer to our summary of significant accounting policies and estimates in our Annual Report on Form 10-K filed for the year ended December 31, 2025.

Current wording

There have been no material changes to our critical accounting policies and estimates in the six months ended June 30, 2026. For further information, refer to our summary of significant accounting policies and estimates in our Annual Report on Form 10-K filed for the year ended December 31, 2025.

Previous wording

This report, including the documents incorporated by reference herein, contains certain statements that describe our management’s beliefs concerning future business conditions, plans and prospects, growth opportunities and the outlook for our business based upon information currently available. Such statements are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). Wherever possible, we have identified these forward-looking statements by words such as “will,” “may,” “anticipates,” “believes,” “intends,” “estimates,” “expects,” “plans,” “projects,” “trends,” “opportunity,” “current,” “intention,” “position,” “assume,” “potential,” “outlook,” “remain,” “continue,” “maintain,” “sustain,” “seek,” “target,” “achieve,” “continuing,” “ongoing,” and similar words or phrases, or future or conditional verbs such as “would,” “should,” “could,” “may,” or similar expressions. Among the factors that could cause actual results to differ materially from those set forth in the forward-looking statements include, but are not limited to, uncertainties associated with our expectations regarding future revenue, growth in revenue, market penetration for MACI®, MACI Arthro®, Epicel®, and NexoBrid®, growth in profit, gross margins and operating margins, the ability to continue to scale our manufacturing operations to meet the demand for our cell therapy products, the ability to sustain profitability, contributions to adjusted EBITDA, the expected target surgeon audience, potential fluctuations in sales and volumes and our results of operations over the course of the year, timing and conduct of clinical trial and product development activities, timing and likelihood of the FDA’s potential approval of the use of MACI to treat cartilage defects in the ankle, the timing and likelihood of obtaining market approval for MACI in the United Kingdom, the estimate of the commercial growth potential of our products and product candidates, competitive developments, changes in third-party coverage and reimbursement, including recent and future healthcare reform measures and private payor initiatives, surgeon adoption of MACI Arthro, physician and burn center adoption of NexoBrid, labor strikes, supply chain disruptions or other events or factors that might affect our ability to manufacture MACI or Epicel or affect MediWound’s ability to manufacture and supply sufficient quantities of NexoBrid to meet customer demand, including but not limited to conflicts in the Middle East region involving Israel or those related to disruptions of land or sea transportation routes or distribution or shipping channels, uncertainties associated with the potential benefits of the Company’s agreement with BARDA for the procurement and development of NexoBrid and the availability of funding from BARDA under that ag…

Excerpt shortened here; the source contains the full paragraph.

Current wording

This report, including the documents incorporated by reference herein, contains certain statements that describe our management’s beliefs concerning future business conditions, plans and prospects, growth opportunities and the outlook for our business based upon information currently available. Such statements are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). Wherever possible, we have identified these forward-looking statements by words such as “will,” “may,” “anticipates,” “believes,” “intends,” “estimates,” “expects,” “plans,” “projects,” “trends,” “opportunity,” “current,” “intention,” “position,” “assume,” “potential,” “outlook,” “remain,” “continue,” “maintain,” “sustain,” “seek,” “target,” “achieve,” “continuing,” “ongoing,” and similar words or phrases, or future or conditional verbs such as “would,” “should,” “could,” “may,” or similar expressions. Among the factors that could cause actual results to differ materially from those set forth in the forward-looking statements include, but are not limited to, uncertainties associated with our expectations regarding future revenue, growth in revenue, market penetration for MACI®, MACI Arthro®, Epicel®, and NexoBrid®in the U.S. and in applicable markets outside the U.S., growth in profit, gross margins and operating margins, the ability to continue to scale our manufacturing operations to meet the demand for our cell therapy products, the ability to sustain profitability, the expected target surgeon audience, potential fluctuations in sales and volumes and our results of operations over the course of the year, timing and conduct of clinical trial and product development activities, timing and likelihood of the FDA’s potential approval of the use of MACI to treat cartilage defects in the ankle, the timing and likelihood of obtaining market approval for MACI in the United Kingdom, the estimate of the commercial growth potential of our products and product candidates, competitive developments, changes in third-party coverage and reimbursement, including recent and future healthcare and drug pricing reform measures and private payor initiatives, surgeon adoption of MACI Arthro, physician and burn center adoption of NexoBrid, labor strikes, supply chain disruptions or other events or factors that might affect our ability to manufacture MACI or Epicel or affect MediWound’s ability to manufacture and supply sufficient quantities of NexoBrid to meet customer demand, including but not limited to conflicts in the Middle East region involving Israel or those related to disruptions of land or sea transportation routes or distribution or shipping channels, uncertainties associated with the potential benefits of the Company’s agreement with BARDA for the procurement and development of NexoBrid and the availabilit…

Excerpt shortened here; the source contains the full paragraph.