Senseonics Holdings (SENS) risk factors, FY2025 10-K

Other

1. 01Summary of Risks Affecting Our Business92% rewritten

Risks Relating to our Business and our Industry

1. 02We have incurred significant operating losses since inception and cannot assure you that we will ever achieve or sustain profitability22% rewritten
2. 03The transition of commercial responsibility for Eversense to Senseonics in European markets is subject to the finalization and execution of definitive agreements with Ascensia and an uncertain government approval processNew
3. 04Our resumption of commercial responsibility for Eversense will require us to develop a number of internal functions and may not be successfulNew
4. 05We have limited operating history as a commercial-stage company and may face difficulties encountered by companies early in their commercialization in competitive and rapidly evolving markets
5. 06If we are unable to successfully expand our commercialization of Eversense in the United States and Europe our business will be harmed
6. 07Our collaboration agreement with Sequel Med Tech may not lead to the benefits that we anticipateNew
7. 08We are dependent on one product, Eversense. Our success depends on our ability to continue to develop, commercialize and gain market acceptance for our products
8. 09In addition, Eversense may be perceived by people with diabetes, their caregivers or healthcare providers to be more complicated or less effective than traditional monitoring methodologies, including SMBG or CGM systems which may require less calibration, and people may be unwilling to change their current regimens
9. 10We contract with third parties for the manufacture of Eversense. Risks associated with the manufacturing of our products could reduce our gross margins and negatively affect our operating results
10. 11We depend on a limited number of third-party suppliers for the components of Eversense and the loss of any of these suppliers, or their inability to provide us with an adequate supply of materials, could harm our business
11. 12Our third-party suppliers operate primarily at facilities in a single location, and any disruption to these facilities could adversely affect our business and operating results
12. 13If we do not enhance our product offerings through our research and development efforts, we may fail to effectively compete or become profitable
13. 14If important assumptions we have made about what people with intensively managed diabetes are seeking in a CGM system are inaccurate, our business and operating results may be adversely affected
14. 15We operate in a very competitive industry and if we fail to compete successfully against our existing or potential competitors, many of whom have greater resources than we have, our sales and operating results may be negatively affected
15. 16Competitive products or other technological innovations for the monitoring, treatment or prevention of diabetes may render our products less competitive or obsolete
16. 17The size and future growth in the market for CGM systems and CGM-related products has not been established with precision and may be smaller than we estimate, possibly materially. If our estimates and projections overestimate the size of this market, our sales growth may be adversely affected
17. 18Our ability to maintain and grow our revenue will depend on establishing a customer base and retaining a high percentage of our customer base
18. 19Various factors outside our direct control may adversely affect manufacturing, sterilization and distribution of our products
19. 20Potential complications from Eversense or future versions of Eversense may not be revealed by our clinical experience
20. 21Undetected errors or defects in Eversense or future versions of Eversense could harm our reputation, decrease the market acceptance of Eversense or expose us to product liability claims
21. 22We may enter into collaborations, in-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 revenues
22. 23We 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 harm our business, financial condition and operating results
23. 24International trade policies, including tariffs, sanctions and trade barriers may adversely affect our business, financial condition, results of operations and prospectsNew
24. 25as trade restrictions or trade barriers, which could restrict us from doing business directly or indirectly in or with certain countries or parties and may impose additional costs and complexity to our businessNew

Risks Related to our Financial Results and Need for Financing

1. 26We will need to generate significant sales to achieve profitable operations
2. 27We cannot predict the ultimate effect on our common stock share price of the one-for-twenty Reverse Stock Split of our common stock that was effected on October 17, 2025. The Reverse Stock Split may decrease the liquidity of our common stock and magnify any decrease in our overall market capitalizationNew
3. 28Our operating results may fluctuate from quarter to quarter or year to year
4. 29Our product revenue is subject to seasonal variation
5. 30Covenants under the Loan and Security Agreement may result in the acceleration of outstanding indebtedness and limit the manner in which we operate
6. 31Servicing our debt requires a significant amount of cash, and we may not have sufficient cash flow from our business to pay our substantial debt
7. 32Despite our current debt levels, subject to certain conditions and limitations, we may still incur substantially more debt or take other actions which would intensify the risks discussed above33% rewritten
8. 33Our business may be exposed to foreign exchange risks
9. 34There is uncertainty regarding our ability to maintain liquidity sufficient to operate our business effectively, which raises substantial doubt about our ability to continue as a going concern53% rewritten

Risks Related to Development of our Products

1. 35If we modify our approved product or CE Marked, we may need to seek additional approvals or CE Certificates of Conformity, which, if not granted, would prevent us from selling our modified products
2. 36Medical device development involves a lengthy and expensive process, with an uncertain outcome. We may incur additional costs or experience delays in completing, or ultimately be unable to complete, ongoing development for lifecycle management of our products

Risks Related to Employee Matters and Managing our Growth

1. 37Our future success depends on our ability to retain key executives and to attract, retain and motivate qualified personnel27% rewritten
2. 38We will need to expand our sales and marketing and potentially other capabilities, and as a result, we may encounter difficulties in managing our growth, which could disrupt our operations39% rewritten
3. 39Our employees, independent contractors, consultants, manufacturers and distributors may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements
4. 40We may incur product liability losses, and insurance coverage may be inadequate or unavailable to cover these losses

Risks Related to our Intellectual Property

1. 41Our ability to protect our intellectual property and proprietary technology is uncertain
2. 42Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by government patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements
3. 43The medical device industry is characterized by patent litigation, and we could become subject to litigation that could be costly, result in the diversion of management's time and efforts, stop our development and commercialization measures, harm our reputation or require us to pay damages77% rewritten
4. 44We are further reviewing the allegations, and intend to vigorously defend this matter, however, the outcome of any litigation, such as this, is inherently unpredictableNew
5. 45We may be subject to damages resulting from claims that we, or our employees, have wrongfully used or disclosed alleged trade secrets of our competitors or are in breach of non-competition or non-solicitation agreements with our competitors
6. 46We may be subject to claims challenging the inventorship of our patents and other intellectual property
7. 47We are subject to the patent laws of countries other than the United States, which may not offer the same level of patent protection and whose rules could seriously affect how we draft, file, prosecute and maintain patents, trademarks and patent and trademark applications
8. 48Our intellectual property rights do not necessarily address all potential competitive threats or confer meaningful competitive benefits

Risks Related to our Legal and Regulatory Environment

1. 49Our products and operations are subject to extensive governmental regulation, and failure to comply with applicable requirements could cause our business to suffer
2. 50The FDA regulatory clearance process and regulatory processes in other countries are expensive, time-consuming and uncertain, and the failure to obtain and maintain required regulatory clearances, certification and approvals could prevent us from commercializing Eversense and future versions of Eversense
3. 51If the FDA requires us to go through a more rigorous examination for future products or modifications to existing products than we had expected, our product introductions or modifications could be delayed or canceled, which could cause our sales to decline or to not increase in line with our expectations
4. 52If we or our third-party suppliers fail to comply with the FDA's or other foreign regulatory authorities’ good manufacturing practice regulations, this could impair our ability to market our products in a cost-effective and timely manner
5. 53A recall of our products, or the discovery of serious safety issues with our products, could have a significant negative impact on us
6. 54We are subject to additional federal, state and foreign laws and regulations relating to our healthcare business; our failure to comply with those laws could have an adverse impact on our business70% rewritten
7. 55Because of our hybrid work policies, sensitive information may be less secure as more of our employees utilize network connections, computers and devices outside our premises or network, including working at home, while in transit and in public locations27% rewritten
8. 56may prevent or cause customers to stop using our products, deter new customers from using our products, and negatively impact our ability to grow and operate our businessNew
9. 57We may be liable if the FDA, competent authorities of the EEA countries, or another regulatory agency concludes that we have engaged in the off-label promotion of our products
10. 58International sales of medical devices are subject to foreign government regulations, which vary substantially from country to country. In order to market our products in other countries, we must obtain regulatory approvals or certifications and comply with extensive safety and quality regulations in other countries
11. 59Off-label use of our product by patients could lead to product liability claims and regulatory action
12. 60Legislative or regulatory healthcare reforms may make it more difficult and costly for us to obtain regulatory clearance, certification or approval of our products or otherwise impact our profitability44% rewritten

Risks Related to our Common Stock

1. 61Because our stock price has and will likely continue to be highly volatile, the market price of our common stock may be lower or more volatile than expected
2. 62The issuance of additional stock in connection with financings, acquisitions, investments, our equity incentive plans, or otherwise will dilute our existing stockholders
3. 63PHC may have the ability exert substantial influence over us in a manner adverse to your interestsNew
4. 64The rights that we have granted to Abbott in connection with a recent private placement may affect the likelihood of a change of control of SenseonicsNew
5. 65If our estimates relating to our critical accounting policies are based on assumptions or judgments that change or prove to be incorrect, our operating results could fall below expectations of financial analysts and investors, resulting in a decline in our stock price
6. 66We do not intend to pay cash dividends in the foreseeable future
7. 67Provisions in our corporate charter documents and under Delaware law may prevent or frustrate attempts by our stockholders to change our management and hinder efforts to acquire a controlling interest in us, and the market price of our common stock may be lower as a result
8. 68(4) any action asserting a claim governed by the internal affairs doctrine. However, this exclusive forum provision would not apply to suits brought to enforce a duty or liability created by the Securities Act or the Exchange Act
9. 69If we fail to maintain proper and effective internal controls, our ability to produce accurate financial statements on a timely basis could be impaired
10. 70Our effective tax rate may fluctuate, and we may incur obligations in tax jurisdictions in excess of accrued amounts
11. 71We may be unable to utilize our tax attribute carryforwards to reduce our income taxes24% rewritten
12. 72Changes in tax laws or regulations that are applied adversely to us or our customers may have a material adverse effect on our business, cash flow, financial condition, or results of operations79% rewritten
13. 73Our bank deposits in excess of the Federal Deposit Insurance Corporation (“FDIC”) insurance limits could be impacted if the underlying financial institutions fail