Alphatec Holdings (ATEC) risk factors, FY2025 10-K

Risks Related to Our Business and Industry

1. 01We operate in a highly competitive market segment, face competition from large, well-established medical device companies with significant resources, and may not be able to compete effectively
2. 02greater experience in obtaining and maintaining FDA and other regulatory clearances or approvals for products and product enhancements
3. 03Our reliance on sales agents could affect our ability to market our products efficiently and profitably
4. 04Demand for our products, and prices at which customers and patients are willing to pay for our products depend upon the ability of our customers to obtain adequate third-party coverage and reimbursement product purchases
5. 05If we or our suppliers fail to comply with applicable regulations, the manufacture of our products could be delayed
6. 06If we fail to timely obtain governmental clearances or approvals for our future products or modifications to our products, our ability to commercially distribute and market our products could suffer
7. 07changes in regulatory policies, increased submission volumes, or reduced staffing and administrative capacity at regulatory agencies such as the FDANew
8. 08To be commercially successful, we must convince the spine surgeon community that our products are an attractive alternative to competitive products
9. 09Our business plan relies on certain assumptions pertaining to the market for our products that, if incorrect, may adversely affect our growth and profitability
10. 10We are dependent on our senior management team, sales and marketing team, engineering team and key surgeon advisors, and the loss of any of them could harm our business87% rewritten
11. 11We rely on a limited number of third parties to manufacture and supply our products. Any problems experienced by these manufacturers could result in a delay or interruption in the supply of our products until such manufacturer cures the problem or until we locate and qualify an alternative source of supply
12. 12We depend on third-party suppliers, and in one case a single supplier, for key raw materials and the loss of any of these third-party suppliers, or their inability to supply us with adequate raw materials, could harm our business
13. 13Consolidation in the healthcare industry could lead to price concessions or exclusion of some suppliers from some markets, which could have an adverse effect on our business, financial condition or results of operations84% rewritten
14. 14Operation of our business internationally is subject to our continued compliance with the laws and regulations of each country in which we operate, as well as the business and legal customs in those jurisdictions and geographies
15. 15A significant percentage of our revenues are derived from sales of our systems that include polyaxial pedicle screws
16. 16We may be subject to or otherwise affected by federal and state healthcare laws, including fraud and abuse, health information privacy and security, and disclosure laws, and could face substantial penalties if we are unable to fully comply with such laws
17. 17a variety of state-imposed privacy and data security laws which require the protection of personal information beyond health information and which require reporting to state officials in the event of breach or violation and which impose both civil and criminal penalties
18. 18If we fail to properly manage our anticipated growth, our business could suffer
19. 19Nearly all of our operations are currently conducted in locations that may be at risk of damage from fire, earthquakes or other natural disasters
20. 20Public health crises, political crises, and other catastrophic events or other events outside of our control may impact our business
21. 21Tariffs and other trade measures could adversely affect our business, results of operations, financial position and cash flowsNew
22. 22If we choose to acquire new and complementary businesses, products or technologies, we may be unable to complete these acquisitions or successfully integrate them in a cost-effective and non-disruptive manner
23. 23The use of artificial intelligence ("AI") technology by our employees or business partners could result in misuse or loss of proprietary information, violation of laws and regulations, or damage to our reputation and credibility
24. 24Alphatec Holdings is a holding company with no operations, and unless it receives dividends or other payments from its subsidiaries, it will be unable to fulfill its cash obligations

Risks Related to Our Intellectual Property, Regulatory Penalties and Litigation

1. 25If we become subject to product liability claims, we may be required to pay damages that exceed our insurance coverage
2. 26Because biologics products entail a potential risk of communicable disease to human recipients, we may be the subject of product liability claims regarding our biologics products
3. 27Any claims relating to our improper handling, storage or disposal of biological, hazardous and radioactive materials could be time consuming and costly
4. 28If our patents and other intellectual property rights do not adequately protect our products, we may lose market share to our competitors and be unable to operate our business profitably
5. 29The medical device industry is characterized by patent and other intellectual property litigation and we could become subject to litigation that could be costly, result in the diversion of management’s time and efforts, require us to pay damages, and/or prevent us from marketing our existing or future products73% rewritten

Risks Related to Our Financial Results, Credit and Certain Financial Obligations and Need for Financing

1. 30We may need to raise additional funds in the future and such funds may not be available on acceptable terms, if at all
2. 31the costs associated with our employee retention programs and related benefits
3. 32We have a history of net losses, we expect to continue to incur net losses in the near future, and we may not achieve or maintain profitability
4. 33A significant economic downturn or volatility in the economy in any market in which we operate could have a material adverse impact on our business, financial condition, results of operations, or cash flows
5. 34Our quarterly financial results could fluctuate significantly
6. 35In addition, until we have a larger base of spine surgeons using our products, occasional fluctuations in the use of our products by individual surgeons or small groups of surgeons will have a proportionately larger impact on our revenues than for companies with a larger customer base
7. 36Covenants in our loan documents and indenture may restrict our business and operations and if we do not effectively manage our covenants, our financial condition and results of operations could be adversely affected

Risks Related to Our Common Stock

1. 37Our stock price may fluctuate significantly, particularly if holders of substantial amounts of our stock attempt to sell, and holders may have difficulty selling their shares based on trading volumes of our stock
2. 38We may become involved in securities class action litigation that could divert management’s attention and harm our business
3. 39Securities analysts may not provide coverage of our common stock or may issue negative reports, which may have a negative impact on the market price of our common stock
4. 40Because of their significant stock ownership, our executive officers, directors and principal stockholders will be able to exert control over us and our significant corporate decisions
5. 41limit who may call stockholder meetings
6. 42Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited
7. 43We could be subject to changes in our tax rates, new tax legislation or additional tax liabilities74% rewritten
8. 44affected by changes in tax laws or interpretations of those tax laws; by stock-based compensation and other non-deductible expenses; by changes in the mix of earnings in countries with differing statutory tax rates; or by changes in the valuation of our deferred tax assets and liabilitiesNew