DarioHealth (DRIO) FY2025 10-K Risk Factors: 13 New, 22 Dropped

What the changes say

DarioHealth faces severe liquidity pressure, highlighted by $452M in accumulated deficits, a $50M Callodine loan facility, and a strategic review process.

What changed since the prior 10-K

New

NewRisks Related to Our Financial Position and Capital Requirements
Given our limited revenue and lack of positive cash flow, we will need to raise additional capital, which may be unavailable to us or, even if consummated, may cause dilution or place significant restrictions on our ability to operate
Our limited revenue and negative cash flow require us to raise additional capital, risking dilution or operational restrictions.
NewRisks Related to Our Financial Position and Capital Requirements
Our indebtedness under the Callodine loan facility subjects us to financial covenants and other restrictions that could adversely affect our liquidity, operational flexibility and financial condition
Our $50.0 million Callodine loan facility imposes strict financial covenants, liquidity minimums, and revenue conditions that could restrict our operations.
NewRisks Related to Our Business
Our dependence on SaaS business model, third-party services and network infrastructure could adversely affect our business and results of operations
Our reliance on a subscription SaaS model creates revenue fluctuations and requires economies of scale that we may fail to achieve.
NewRisks Related to Our Business
Changes in U.S. laws or policies, including trade policies and tariffs, could adversely affect our business and results of operations
U.S. tariffs and trade policies could increase costs and disrupt our supply chain for connected health devices manufactured outside the United States.
NewRisks Related to Our Business
outside the United States. As a result, tariffs, trade restrictions or other changes in trade policy could increase our costs, disrupt our supply chain, delay product availability or require modifications to our sourcing and logistics strategies
NewRisks Related to Our Business
Our strategic review process may not result in a transaction and may create additional risks and uncertainties for our business
Our Board's ongoing strategic review process may not result in a transaction and could distract management from day-to-day operations.
NewRisks Related to Our Business
Our outcomes-based contracts and reimbursement arrangements may not achieve expected results and may expose us to financial and operational risks
Our outcomes-based contracts with payers tie reimbursement to clinical results, exposing us to financial penalties if we miss target metrics.
NewRisks Related to Our Intellectual Property
In order for our business to be viable and to compete effectively, we need to maintain and continue to develop, and we heavily rely on, our proprietary position with respect to our technologies and intellectual property
Our intellectual property relies heavily on eleven patents, including three for the Dario Blood Glucose Monitoring System audio jack transmission.
NewRisks Related to Our Industry
We face significant competition in the digital health and connected health device markets, which may limit our ability to grow our business
We compete in digital health against larger companies like Teladoc Health, Omada Health, Vida Health, and Virta Health.
NewRisks Related to Our Industry
If we fail to keep pace with technological change, our offerings may become less competitive
Rapid technological change in digital health could render our cardiometabolic platforms and connected devices uncompetitive.
NewRisks Related to the Ownership of Our Common Stock
There can be no assurance that we will be able to maintain continued Nasdaq listing criteria
We recently regained compliance with Nasdaq minimum bid price rules after a 20-for-1 reverse stock split, but future compliance is uncertain.
NewRisks Related to the Ownership of Our Common Stock
Future sales of our securities could depress the market price of our common stock
Future sales of our common stock or the perception of such sales could depress our stock price.
NewRisks Related to the Ownership of Our Common Stock
Our compliance with U.S. regulations concerning corporate governance and public disclosure is expensive

Dropped

DroppedRisks Related to Our Financial Position and Capital Requirements
We were formed in August 2011 and are thus subject to the risks associated with new businesses
Risks associated with being formed in August 2011 as a new business.
DroppedRisks Related to Our Financial Position and Capital Requirements
We may be subject to claims for rescission or damages in connection with certain sales of shares of our securities
DroppedRisks Related to Our Financial Position and Capital Requirements
Our revenues are concentrated with a major customer, and our revenues may decrease significantly if we were to lose our major customer
DroppedRisks Related to Our Business
The success of our Dario product will depend on the acceptance of Dario in the healthcare market
DroppedRisks Related to Our Business
If Dario fails to satisfy current or future customer requirements, we may be required to make significant expenditures to redesign the product, and we may have insufficient resources to do so
Claims for rescission or damages from a March 2016 registration statement.
DroppedRisks Related to Our Business
We rely in part on a small group of third-party distributors to effectively distribute our products
Concentration of revenue with a major customer accounting for 41.6% of receivables.
DroppedRisks Related to Our Business
We rely upon Software-as-a-Services, or SAAS, technologies from third parties to operate our business, and interruptions or performance problems with these technologies may adversely affect our business, financial condition and results of operations
DroppedRisks Related to Our Business
The SaaS pricing model is evolving and our failure to manage its evolution and demand could lead to lower than expected revenue and profit
Market acceptance dependence for the Dario product across international and US markets.
DroppedRisks Related to Our Business
Our results of operations may fluctuate significantly due to the timing of our recognition of SaaS revenues
DroppedRisks Related to Our Business
Any damage, failure or disruption of our SaaS network infrastructure or data centers could impair our ability to effectively provide our solution, harm our reputation and adversely affect our business
Risks of failing to satisfy customer requirements and needing costly product redesigns.
DroppedRisks Related to Our Business
We may not generate the expected benefits of our acquisition of Twill
DroppedRisks Related to Product Development and Regulatory Approval
We may be unable to complete required clinical trials, or we may experience significant delays in completing such clinical trials, which could significantly delay our targeted product launch timeframe and impair our viability and business plan
DroppedRisks Related to Product Development and Regulatory Approval
We are subject to the risk of reliance on third parties to conduct our clinical trial work
Reliance on a small group of third-party medical device distributors.
DroppedRisks Related to Product Development and Regulatory Approval
delayed or terminated, and we may not be able to obtain marketing authorization for or successfully commercialize our product candidates
DroppedRisks Related to Product Development and Regulatory Approval
Product liability suits, whether or not meritorious, could be brought against us due to an alleged defective product or for the misuse of Dario or our potential future products. These suits could result in expensive and time-consuming litigation, payment of substantial damages, and an increase in our insurance rates
Reliance on third-party SaaS technologies for internal operations.
DroppedRisks Related to Product Development and Regulatory Approval
of price or service when a consumer exercises a privacy right. If we fail to comply with these regulations, we could be subject to civil sanctions, including fines and penalties for noncompliance
Uncertainty in managing the evolving SaaS pricing model.
DroppedRisks Related to Our Industry
We face intense competition in the digital support solution and the self-monitoring of blood glucose market, and as a result we may be unable to effectively compete in our industry
Results fluctuation due to timing of SaaS versus hardware revenue recognition.
DroppedRisks Related to Our Industry
If we fail to respond quickly to technological developments our products may become uncompetitive and obsolete
Vulnerability of US data centers and SaaS network infrastructure.
DroppedRisks Related to Our Industry
If third-party payors do not provide adequate coverage and reimbursement for the use of our products and services, our revenue will be negatively impacted
DroppedRisks Related to the Ownership of Our Common Stock
Nasdaq may delist our securities from trading on its exchange, which could limit investors’ ability to make transactions in our securities and subject us to additional trading restrictions
DroppedRisks Related to the Ownership of Our Common Stock
Our officers and directors may exert significant influence over our affairs, including the outcome of matters requiring stockholder approval
DroppedRisks Related to the Ownership of Our Common Stock
Shares eligible for future sale may adversely affect the market for our common stock and warrants

Reworded

100% rewrittenRisks Related to Our Intellectual Property
The failure to obtain or maintain patents, licensing agreements and other intellectual property could materially impact our ability to compete effectively
The heading and scope were broadened from specific patent prosecution details to general failure to obtain or maintain intellectual property.
97% rewrittenRisks Related to Our Business
There is no assurance that our digital health engagement platform will succeed or achieve broad adoption by healthcare providers, employers, health plans or other enterprise customers
Updated to specify a B2B2C model targeting cardiometabolic and behavioral health, detailing lengthy enterprise sales cycles and validation requirements.
Was: There is no assurance that our digital health engagement platform will succeed or be adopted by healthcare providers
79% rewrittenRisks Related to Product Development and Regulatory Approval
If we or our manufacturers fail to comply with the FDA’s Quality System Regulation, pre-market notifications, or any applicable state equivalent, our operations could be interrupted, and our operating results could suffer
Minor edits concerning FDA Quality System Regulation compliance for manufacturers without changing core meaning.
Was: If we or our manufacturers fail to comply with the FDA’s Quality System Regulation or any applicable state equivalent, our operations could be interrupted, and our operating results could suffer
70% rewrittenRisks Related to Our Intellectual Property
We may be subject to claims challenging the inventorship of our patents and other intellectual property
Minor grammatical edits changing product candidate references to product.
68% rewrittenRisks Related to Our Financial Position and Capital Requirements
We have incurred significant losses since inception. As such, you cannot rely upon our historical operating performance to make an investment decision regarding our company
Updated accumulated deficit figures to $452,078,000 as of December 31, 2025, and net losses to $41,714,000 for 2025.
65% rewrittenRisks Related to Product Development and Regulatory Approval
We have conducted limited clinical trials of certain of our solutions. Clinical and nonclinical data is susceptible to varying interpretations, which could delay, limit or prevent additional regulatory clearances
Clarified clinical trial risks specifically around blood glucose monitoring system FDA clearance and future application authorizations.
Was: We have conducted limited clinical trials of Dario. Clinical and nonclinical data is susceptible to varying interpretations, which could delay, limit or prevent additional regulatory clearances
59% rewrittenRisks Related to Our Operations in Israel
Our principal executive offices and other significant operations are located in Israel, and, therefore, our results may be adversely affected by political, economic and military instability in Israel, including a multi front war against Israel
Retained the risk of operational disruption in Israel due to war, updating context to ongoing hostilities.
57% rewrittenRisks Related to Product Development and Regulatory Approval
If we are found to have violated laws protecting the confidentiality of patient health information, we could be subject to civil or criminal penalties, which could increase our liabilities and harm our reputation or our business
Expanded HIPAA confidentiality risks from covering user medical data monetization to general handling of medical and personal data.
54% rewrittenRisks Related to the Ownership of Our Common Stock
If we fail to maintain effective internal control over financial reporting, the price of our common stock may be adversely affected
52% rewrittenRisks Related to the Ownership of Our Common Stock
Anti-takeover provisions in our charter documents and Delaware law could discourage, delay or prevent a change in control of our company and may affect the trading price of our common stock and warrants
50% rewrittenRisks Related to Our Business
Failure in our online and digital marketing efforts could significantly impact our ability to generate sales
48% rewrittenRisks Related to Product Development and Regulatory Approval
Our employees, independent contractors, consultants, manufacturers and suppliers may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements
42% rewrittenRisks Related to Our Business
As we conduct business internationally, we are susceptible to risks associated with international relationships
41% rewrittenRisks Related to Our Financial Position and Capital Requirements
According to our management’s estimates, based on our current cash on hand and further based on our budget and the assumption related to our commercial sales, we believe that we will have sufficient resources to continue our activities for at least a period of twelve months from the date of the issuance of this 10K
Was: According to our management’s estimates, based on our current cash on hand and further based on our budget and the assumption that initial commercial sales will commence during our anticipated timeframes, we believe that we will have sufficient resources to continue our activities through 2025
40% rewrittenRisks Related to Our Business
Our future performance will depend on the continued engagement of key members of our management team
34% rewrittenRisks Related to Our Business
Non-U.S. governments often impose strict price controls, which may adversely affect our future profitability
34% rewrittenRisks Related to the Ownership of Our Common Stock
The market price of our common stock has been extremely volatile and may continue to be volatile due to numerous circumstances beyond our control
25% rewrittenRisks Related to Our Business
If we are unable to attract and retain highly skilled managerial, scientific and technical personnel, we may not be able to implement our business model successfully
Was: If we are not able to attract and retain highly skilled managerial, scientific and technical personnel, we may not be able to implement our business model successfully
23% rewrittenRisks Related to the Ownership of Our Common Stock
If securities or industry analysts do not publish or cease publishing research or reports about us, our business or our market, or if they change their recommendations regarding our common stock adversely, the price of our common stock and trading volume could decline
22% rewrittenRisks Related to Our Business
We cannot accurately predict the volume or timing of any future sales, making the timing of any revenues difficult to predict
22% rewrittenRisks Related to Product Development and Regulatory Approval
Broad-based domestic and international government initiatives to reduce spending, particularly those related to healthcare costs, may reduce reimbursement rates for medical procedures, or make it more difficult for customers to purchase our products and services, all of which could adversely affect our business
21% rewrittenRisks Related to Our Business
Our products are subject to technological changes which may impact their use

All 47 risk factors

Headings as the filing states them, in filing order.

Risks Related to Our Financial Position and Capital Requirements

01Given our limited revenue and lack of positive cash flow, we will need to raise additional capital, which may be unavailable to us or, even if consummated, may cause dilution or place significant restrictions on our ability to operateNew
02According to our management’s estimates, based on our current cash on hand and further based on our budget and the assumption related to our commercial sales, we believe that we will have sufficient resources to continue our activities for at least a period of twelve months from the date of the issuance of this 10K41% rewritten
03If we raise additional funds through collaborations and licensing arrangements, we may be required to relinquish some rights to our technologies or products, or to grant licenses on terms that are not favorable to us
04We have incurred significant losses since inception. As such, you cannot rely upon our historical operating performance to make an investment decision regarding our company68% rewritten
05Our indebtedness under the Callodine loan facility subjects us to financial covenants and other restrictions that could adversely affect our liquidity, operational flexibility and financial conditionNew

Risks Related to Our Business

06There is no assurance that our digital health engagement platform will succeed or achieve broad adoption by healthcare providers, employers, health plans or other enterprise customers97% rewritten
07We cannot accurately predict the volume or timing of any future sales, making the timing of any revenues difficult to predict22% rewritten
08We expect to derive substantially all of our revenues from our principal technology, which leaves us subject to the risk of reliance on such technology
09We are dependent upon third-party manufacturers and suppliers, making us vulnerable to supply shortages and problems and price fluctuations, which could harm our business
10Failure in our online and digital marketing efforts could significantly impact our ability to generate sales50% rewritten
11Our dependence on SaaS business model, third-party services and network infrastructure could adversely affect our business and results of operationsNew
12Our products are subject to technological changes which may impact their use21% rewritten
13As we conduct business internationally, we are susceptible to risks associated with international relationships42% rewritten
14We expect to be exposed to fluctuations in currency exchange rates, which could adversely affect our results of operations
15Changes in U.S. laws or policies, including trade policies and tariffs, could adversely affect our business and results of operationsNew
16outside the United States. As a result, tariffs, trade restrictions or other changes in trade policy could increase our costs, disrupt our supply chain, delay product availability or require modifications to our sourcing and logistics strategiesNew
17Non-U.S. governments often impose strict price controls, which may adversely affect our future profitability34% rewritten
18Our Dario platform and associated business processes may contain undetected errors, which could limit our ability to provide our services and diminish the attractiveness of our service offerings
19Our future performance will depend on the continued engagement of key members of our management team40% rewritten
20If we are unable to attract and retain highly skilled managerial, scientific and technical personnel, we may not be able to implement our business model successfully25% rewritten
21Our strategic review process may not result in a transaction and may create additional risks and uncertainties for our businessNew
22Our outcomes-based contracts and reimbursement arrangements may not achieve expected results and may expose us to financial and operational risksNew

Risks Related to Product Development and Regulatory Approval

23The regulatory clearance process which we must navigate is expensive, time-consuming, and uncertain and may prevent us from obtaining clearance for the commercialization of our current or any future product
24We are not permitted to market our medical device products in any jurisdiction until we receive marketing authorization from the applicable regulatory authority. To date, we have received regulatory authorization in Australia, Canada, Israel and the United States
25We have conducted limited clinical trials of certain of our solutions. Clinical and nonclinical data is susceptible to varying interpretations, which could delay, limit or prevent additional regulatory clearances65% rewritten
26If we or our manufacturers fail to comply with the FDA’s Quality System Regulation, pre-market notifications, or any applicable state equivalent, our operations could be interrupted, and our operating results could suffer79% rewritten
27Broad-based domestic and international government initiatives to reduce spending, particularly those related to healthcare costs, may reduce reimbursement rates for medical procedures, or make it more difficult for customers to purchase our products and services, all of which could adversely affect our business22% rewritten
28If we are found to have violated laws protecting the confidentiality of patient health information, we could be subject to civil or criminal penalties, which could increase our liabilities and harm our reputation or our business57% rewritten
29Our employees, independent contractors, consultants, manufacturers and suppliers may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements48% rewritten

Risks Related to Our Intellectual Property

30The failure to obtain or maintain patents, licensing agreements and other intellectual property could materially impact our ability to compete effectively100% rewritten
31In order for our business to be viable and to compete effectively, we need to maintain and continue to develop, and we heavily rely on, our proprietary position with respect to our technologies and intellectual propertyNew
32Costly litigation may be necessary to protect our intellectual property rights and we may be subject to claims alleging the violation of the intellectual property rights of others
33We have limited foreign intellectual property rights and may not be able to protect our intellectual property rights throughout the world
34We rely on confidentiality agreements that could be breached and may be difficult to enforce, which could result in third parties using our intellectual property to compete against us
35We may be subject to claims challenging the inventorship of our patents and other intellectual property70% rewritten

Risks Related to Our Industry

36We face significant competition in the digital health and connected health device markets, which may limit our ability to grow our businessNew
37If we fail to keep pace with technological change, our offerings may become less competitiveNew

Risks Related to Our Operations in Israel

38Our principal executive offices and other significant operations are located in Israel, and, therefore, our results may be adversely affected by political, economic and military instability in Israel, including a multi front war against Israel59% rewritten

Risks Related to the Ownership of Our Common Stock

39There can be no assurance that we will be able to maintain continued Nasdaq listing criteriaNew
40If securities or industry analysts do not publish or cease publishing research or reports about us, our business or our market, or if they change their recommendations regarding our common stock adversely, the price of our common stock and trading volume could decline23% rewritten
41The market price of our common stock has been extremely volatile and may continue to be volatile due to numerous circumstances beyond our control34% rewritten
42Future sales of our securities could depress the market price of our common stockNew
43Our compliance with U.S. regulations concerning corporate governance and public disclosure is expensiveNew
44If we fail to maintain effective internal control over financial reporting, the price of our common stock may be adversely affected54% rewritten
45Anti-takeover provisions in our charter documents and Delaware law could discourage, delay or prevent a change in control of our company and may affect the trading price of our common stock and warrants52% rewritten
46We are a smaller reporting company and the reduced reporting requirements applicable to smaller reporting companies may make our common stock less attractive to investors
47We do not currently intend to pay dividends on our common stock in the foreseeable future, and consequently, your ability to achieve a return on your investment will depend on appreciation in the price of our common stock

Other DarioHealth 10-Ks

FY2024 10-K risk factors
56 risks
DarioHealth relies heavily on cash reserves, ongoing debt or equity financing, and a single major customer representing 41.6% of receivables. The company faces extensive regulatory, clinical, and privacy compliance requirements across international markets for its digital health platform.
Filed Mar 10, 2025

About this page

The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.