Myomo (MYO) risk factors, FY2025 10-K

Risks Related to Our Operating and Financial Results

1. 01We have a history of operating losses. Investments in advertising, R&D and clinical, reimbursement and manufacturing capacity could result in a delay in our ability to achieve cash flow breakeven on a quarterly basis79% rewritten
2. 02Our direct billing revenues are concentrated with a small number of payers, including CMS. Adverse changes in the reimbursement policies of these payers regarding the MyoPro could have an adverse effect on our business29% rewritten
3. 03We may experience significant fluctuations in our quarterly and annual results
4. 04the loss of any significant customer
5. 05Continued inflation may materially impact our financial operations or results of operations
6. 06Significant political, trade, regulatory developments, and other circumstances beyond our control, could have a material adverse effect on our financial condition or results of operations63% rewritten

Risks related to our Reliance on Third Parties

1. 07We may not be able to obtain third-party payer reimbursement, including reimbursement by Medicare, for our products25% rewritten
2. 08If CMS amends, restricts, or retracts coverage requirements, its billing contractors and insurers offering Medicare Advantage insurance plans may restrict what they reimburse for the MyoPro, which would have an adverse effect on our business66% rewritten
3. 09Changes made by direct to consumer advertising platforms (such as social media) in how they reach prospective patients could adversely impact our lead generation efforts, resulting in higher advertising cost per addition to our patient pipeline and have an adverse effect on revenuesNew
4. 10We currently rely, and in the future will rely, on sales of our MyoPro products for our revenue, and we may not be able to expand market acceptance or grow revenues in the orthotics and prosthetics channel
5. 11We depend on a single third-party to manufacture key subassemblies for the MyoPro and a limited number of third-party suppliers for certain components of the MyoPro47% rewritten
6. 12chain, we could face regulatory enforcement, have to conduct recalls, lose customer orders, our reputation may be harmed, and our business could sufferNew

Risks Related to Capital Requirements

1. 13We may not have sufficient funds to meet our future capital requirements65% rewritten
2. 14liquidity and increase the amount of cash flow required to service our debt. If we raise funds through the issuance of equity securities, such issuance could result in dilution to our stockholders and the newly issued securities may have rights senior to those of the holders of our common stockNew
3. 15If we raise additional capital through debt financing, the terms of any new debt could further restrict our ability to operate our businessNew

Risks Related to Competitors and Our Market

1. 16We sell to O&P providers who are free to market products that compete with the MyoPro, and we rely on these providers to market and promote our products in accordance with their FDA listings, select appropriate patients and provide adequate follow-on care
2. 17The market for myoelectric braces is relatively new and the rate of adoption is uncertain, and important assumptions about the potential market for our products may be inaccurate
3. 18If the upper extremity orthotics market fails to develop or develops more slowly than we expect, or if we have relied on sources or made assumptions or estimates that are not accurate, our business could be adversely affected

Risks Related to Our Products

1. 19We may receive a significant number of warranty claims or our MyoPro may require significant amounts of service after sale
2. 20Defects in our products or the software that drives them could adversely affect the results of our operations
3. 21While there is long-term clinical data supporting the safety of our existing MyoPro products, updates to our products inherently have uncertain safety risks as they enter the market

Risks Related to Collaborations and Licensing Agreements

1. 22We may enter into collaborations, licensing arrangements, joint ventures, strategic alliances or partnerships with third parties that may not result in the development of commercially viable products or the generation of significant future revenues31% rewritten

Risks Related to Our Business Operations and Management

1. 23If we fail to properly manage our anticipated growth, including in O&P channel and international markets, our business could suffer87% rewritten
2. 24weaknesses in our infrastructure, systems, processes and controls, which could materially adversely affect our business. Additionally, our anticipated growth will increase the demands placed on our suppliers, resulting in an increased need for us to manage our suppliers and monitor for quality assuranceNew
3. 25We depend on the knowledge and skills of our senior management
4. 26We may seek to grow our business through acquisitions of complementary products or technologies, and the failure to manage acquisitions, or the failure to integrate them with our existing business, could have a material adverse effect on our business, financial condition and operating results
5. 27increased legal and accounting costs relating to the acquisitions or compliance with regulatory matters

Risks Related to Healthcare Industry

1. 28We are subject to extensive governmental regulations relating to the design, development, manufacturing, labeling, marketing, delivery and billing of our products, and a failure to comply with such regulations could lead to withdrawal or recall of our products from the market
2. 29If we or our third-party manufacturers or key suppliers fail to comply with the applicable good manufacturing practice requirements, including FDA’s Quality Management System Regulation, our manufacturing operations could be interrupted24% rewritten
3. 30pursuing criminal prosecution
4. 31Our employees, principal investigators, consultants and commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and insider trading
5. 32We face risks in connection with the Affordable Care Act (“ACA”) or its possible replacement or modifications and other ongoing healthcare legislative and regulatory reform measures

Risks Related to Cybersecurity and Data Protection

1. 33Our internal computer systems, or those of our customers, collaborators or other contractors, third-party service providers and vendors may be subject to cyber-attacks, compromises or security incidents, which could result in a material disruption of our product development programs88% rewritten
2. 34interruptions in our operations and could result in a material disruption of our business operations, damage to our reputation or a loss of revenuesNew
3. 35European data collection is governed by restrictive regulations governing the use, processing, and cross-border transfer of personal information27% rewritten
4. 36Issues relating to the use of artificial intelligence and machine learning could adversely affect our business and operating resultsNew

Risks Related to Our Intellectual Property

1. 37Our success depends in part on our ability to obtain and maintain protection for the intellectual property relating to or incorporated into our products
2. 38We are not able to protect our intellectual property rights in all countries
3. 39We may be subject to patent infringement claims, which could result in substantial costs and liability and prevent us from commercializing our current and future products
4. 40We rely on trademark protection to distinguish our products from the products of our competitors
5. 41We may be subject to damages resulting from claims that our employees or we have wrongfully used or disclosed alleged trade secrets of their former employers

Risks Related to Ownership of Our Securities

1. 42Our stockholders will experience significant dilution upon the issuance of common stock if the shares of our common stock underlying our warrants are exercised or converted or if Avenue elects to convert some principal payments into common stock58% rewritten
2. 43We may not be able to maintain a listing of our common stock on the NYSE American75% rewritten
3. 44There is no public market for our warrants or pre-funded warrants to purchase common stock
4. 45Holders of our warrants and pre-funded warrants have no rights as a common stockholder until such holders exercise their warrants and acquire our common stock
5. 46The market price of our common stock has been and may continue to be volatile26% rewritten
6. 47We do not expect to declare or pay dividends in the foreseeable future41% rewritten
7. 48If securities industry analysts do not publish research reports on us, or publish unfavorable reports on us, then the market price and market trading volume of our common stock could be negatively affected
8. 49Future issuances of our common stock or equity-related securities could cause the market price of our common stock to decline and would result in the dilution of your holdings
9. 50Future issuances of debt securities, which would rank senior to our common stock upon our bankruptcy or liquidation, and future issuances of preferred stock, which could rank senior to our common stock for the purposes of dividends and liquidating distributions, may adversely affect our common stock price
10. 51If our shares of common stock become subject to the penny stock rules, it would become more difficult to trade our shares
11. 52Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us more difficult, limit attempts by our stockholders to replace or remove our current management and limit the market price of our common stock
12. 53provide that vacancies on our board of directors may be filled only by the vote of a majority of directors then in office, even though less than a quorum or by the holders of at least sixty-six and two-thirds percent (66 2/3%) of the issued and outstanding shares of common stock

Risks Related to Internal Controls

1. 54We cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile91% rewritten
2. 55The preparation of our financial statements involves the use of estimates, judgments and assumptions, and our financial statements may be materially affected if such estimates, judgments or assumptions prove to be inaccurate
3. 56We are incurring increased costs as a public company and our management team is required to devote substantial time to new compliance initiatives and corporate governance practices

Risks Related to Tax Laws

1. 57We may be subject to adverse legislative or regulatory changes in tax laws that could negatively impact our financial condition
2. 58Our ability to use net operating losses and research and development credits to offset future taxable income may be subject to certain limitations31% rewritten
3. 59CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS27% rewritten
4. 60other risks and uncertainties, including those listed under the captain “Risk Factors” in this Annual Report on Form 10-K