UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

For the fiscal year ended December 31, 2025

or

For the transition period from to

Commission File Number: 001-39059

AVITA MEDICAL, INC.

(Exact name of registrant as specified in its charter)

28159 Avenue Stanford

Suite 220

Valencia, CA 91355

(Address of principal executive offices and Zip Code)

Registrant’s telephone number, including area code: (661) 367-9170

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has selected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The aggregate market value of the voting and nonvoting common equity held by non-affiliates of the registrant was approximately $138,669,045 on June 30, 2025, using the closing price on June 30, 2025 of $5.29.

The number of shares of the registrant’s $0.0001 par value common stock outstanding as of February 6, 2026 was 30,631,794.

TABLE OF CONTENTS

FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K (this “Annual Report”) and our other public filings contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give expectations or forecasts of future events. Forward-looking statements can sometimes, but not always, be identified by words such as “anticipate,” “believe,” “contemplate,” “continue,” “estimate,” “expect,” “forecast,” “goal,” “guidance,” “intend,” “look forward,” “may,” “outlook,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” and similar expressions to future periods. Forward-looking statements are not based on historical facts but rather represent current expectations and assumptions. Factors that may influence or contribute to the inaccuracy of the forward-looking statements or cause actual results to differ materially from expected or desired results may include, without limitation: uncertainties associated with our expectations regarding future revenue or future growth in revenue, profit, or gross and/or operating margins, future working capital, costs, productivity, business process, rationalization, investment (including rates); the ability to achieve or sustain profitability; industry market conditions; increased competition; failure to obtain, maintain or enforce our intellectual property rights, including our expectations regarding the future scope of such rights; failure to obtain and/or maintain regulatory approvals and comply with applicable regulations; the conduct or outcome of pre-clinical or clinical studies; operational and management restructuring activities; our ability to find and maintain partnerships relating to collaborations, strategic arrangements, and licensing arrangements; our ability to manage consulting, operational, financial, and capital projects and/or initiatives; mergers and acquisitions (and related integration activities); if third parties fail to uphold their contractual duties or meet expected deadlines; our ability to obtain and maintain favorable coverage and reimbursement determinations from third party payors; market reaction to growth or product initiatives; our ability to expand our sales and marketing organizations to address existing and new markets that we intend to target; our ability to attract and retain qualified personnel, including management; market penetration of our products; changes in our production capacity; the ability to continue to scale our manufacturing operations to meet the demand for our products; non-compliance with debt covenants, which may result in the acceleration of our debt obligations or the need for renegotiations with our lenders; solvency; changes to tax and interest rates; inflationary pressures on the U.S. and global economies, respectively; changes in the legal or regulatory environments; the impact of a cybersecurity breach, terrorist attack or other geopolitical instability; and the impact of a pandemic or epidemic, or natural disaster.

Forward-looking statements relate to the future and are subject to many risks, assumptions and uncertainties, including those risks set forth in this Annual Report in Part I, Item IA Risk Factors and elsewhere. Although we believe the expectations reflected in the forward-looking statements are reasonable, actual results, developments and business decisions could differ materially from those contemplated by such forward-looking statements. The environment in which we operate is highly competitive, regulated and rapidly changing and it is not possible for our management to predict all risks, as new risks emerge from time to time.

All subsequent written and oral forward-looking statements by or attributable to us or persons acting on our behalf are expressly qualified in their entirety by these factors. We undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future developments or otherwise, except as may be required by law.

As used herein, unless the context otherwise requires, references to "we,” “our,” “us,” “the Company,” and “AVITA Medical” refer to AVITA Medical, Inc., a Delaware corporation, and its subsidiaries.

Currency

In this Annual Report, all references to “dollars” or “$” are to the currency of the United States.

PART I

Item 1. BUSINESS

OVERVIEW

AVITA Medical is a leading therapeutic acute wound care company delivering transformative solutions designed to optimize wound healing, accelerate patient recovery, and improve clinical and economic outcomes across the continuum of acute wound management. Our technologies address critical healing needs arising from burns, traumatic injuries and surgical repairs, through a portfolio of proprietary and complementary products that support wound bed preparation, definitive closure, and recovery.

Our current commercial portfolio includes RECELL® (“RECELL”), and two complementary wound care products, PermeaDerm® and Cohealyx™, which together support a comprehensive standard of care for acute wounds.

At the forefront of our portfolio is RECELL, approved by the United States Food & Drug Administration (the “FDA”) for the treatment of thermal burn wounds and full-thickness skin defects. While RECELL is also approved in the United States for restoring pigmentation of stable depigmented vitiligo lesions, we have paused further commercial investment in vitiligo at this time.

In 2024 and 2025, we expanded our product offerings to address additional acute wound care needs. In January 2024, we entered into an exclusive multi-year distribution agreement with Stedical Scientific, Inc. (“Stedical”) to market, sell, and distribute PermeaDerm, a biosynthetic wound matrix in the United States (“U.S.”). In March 2025, we entered into a multi-year agreement to also manufacture PermeaDerm. In July 2024, we entered into an exclusive multi-year development and distribution agreement with Collagen Matrix, LLC d/b/a as Regenity Biosciences (“Regenity”), granting us exclusive rights to market, sell, and distribute Cohealyx, an AVITA-medical branded collagen-based dermal matrix in the U.S., with potential expansion into the European Union (“E.U.”), Australia, and Japan. Cohealyx was commercially launched in the U.S. on April 1, 2025.

CORPORATE HISTORY

AVITA Medical Limited (“AVITA Australia”), the former Australian parent company of AVITA Medical, was founded in December 1992. On October 1, 2019, AVITA Australia began trading its American Depositary Shares on the Nasdaq Capital Market (“Nasdaq”) under the symbol “RCEL”. In 2020, the Company redomiciled to the U.S. (the “Redomiciliation”). Today, our common stock continues to trade on Nasdaq under “RCEL” and our CHESS Depositary Interests (“CDIs”) trade on the Australian Securities Exchange (“ASX”) under the symbol “AVH.”

STRATEGY

RECELL remains the cornerstone of our business; however, beginning in 2024 we evolved AVITA Medical into a multi-product acute wound care platform company. Our strategy is to build a comprehensive portfolio that addresses wound management from initial coverage and wound bed preparation through definitive closure and healing, while leveraging a single commercial infrastructure focused on burn, trauma and surgical centers.

Key elements of our strategy include:

PRODUCT PORTFOLIO

RECELL Technology Platform

RECELL is an autologous cell harvesting technology that enables clinicians to create a suspension of a patient’s own skin cells, called Spray-On Skin™, at the point of care. The technology allows clinicians to treat large wounds using a small donor skin sample, reducing donor site morbidity while maintaining or improving healing outcomes.

How RECELL Works

RECELL enables clinicians to harvest a thin, split-thickness skin sample from the patient and process it into an autologous cellular suspension in approximately 30 minutes. The suspension contains key skin cell populations, including keratinocytes, fibroblasts, and melanocytes, which are critical to regenerative wound healing and pigment restoration.

The technology underlying RECELL was invented in Australia, by the pioneering work of Professor Fiona Wood and fellow scientist Marie Stoner.

Device Evolution

We continue to refine and expand the RECELL technology to meet a range of clinical and workflow needs; including automating key steps in some RECELL procedures, and adopting the technology to efficiently treat a range of different wound sizes:

We expect the RECELL GO platform to serve as a growth driver, further advancing our strategy to expand our impact on wound healing and patient care.

Key U.S. FDA Regulatory Approvals

Market Opportunity

Burn Injuries

In the U.S., approximately 40,000 people have burn injuries severe enough to require hospital admission annually, with an inpatient mortality rate of 2.7%. Second- and third-degree burns often require autologous split-thickness skin grafts (“STSGs”) to achieve definitive closure of the burn wound. However, donor-site creation in a STSG, or autograft, procedure is associated with significant pain, risk of infection, scarring, delayed healing, and increased healthcare costs. In patients with extensive burns, the availability of healthy donor skin may be limited, requiring staged procedures and temporary coverage with allograft (cadaver skin) or xenograft (typically pig skin), which can prolong hospitalization and increase overall cost of care. As such, treatment with STSGs is expensive, costing around $579,000 and resulting in an average hospital stay of 59.4 days for a patient with a 40% TBSA burn injury to recover and return to normal daily activities.

The clinical benefits of achieving rapid and durable wound closure are well recognized and include increased survival, decreased pain duration, reduced infection risk, improved functional and aesthetic outcomes, and potentially shorter hospital stays. RECELL was designed to address the limitations of traditional grafting by enabling treatment of wound areas using a substantially smaller donor skin sample, while preserving or improving healing outcomes.

In pivotal clinical trials, RECELL significantly reduced donor-skin requirements by up to 97.5% for second-degree burns and 32% for third-degree burns when used with meshed autografts, compared to standard of care autografting, without compromising healing. Additionally, a clinical trial for second-degree burns revealed a statistically significant reduction in patient-reported pain, increased patient satisfaction, and improved scar outcomes.

Retrospective studies further demonstrated that fewer autografting procedures are required for definitive closure of full-thickness burns when RECELL is used compared to conventional autografting alone. In pediatric cases (N = 284), treatment with RECELL resulted in a 56% reduction in the mean number of autograft procedures required compared to National Burn Registry (“NBR”) data. Additionally, in adult patients with greater than 50% TBSA (N=318), RECELL resulted in a 60% reduction in the mean number of autograft procedures versus NBR data.

In addition to these clinical benefits, RECELL has demonstrated meaningful health-economic advantages across a range of burn severities. Health-economic analyses have shown that RECELL use is associated with reductions in overall cost of care driven by fewer operative procedures, reduced donor-site morbidity, and the potential for shorter hospital stays. These cost savings have been observed across both deep partial-thickness and full-thickness burns and are net of the cost of the RECELL device.

Budget impact modeling developed by the Company further indicates that, in a representative burn center treating approximately 200 patients annually, adoption of RECELL could reduce total annual treatment costs by approximately 17% compared to conventional autografting alone. Real-world evidence published by IQVIA and supported by the Biomedical Advanced Research and Development Authority (“BARDA”) demonstrates that these economic benefits are observed across a broad range of burn sizes and patient demographics.

In 2025, real-world evidence derived from the American Burn Association’s national burn registry further supported the clinical and operational benefits of RECELL in adult patients with deep partial-thickness burns. In a matched analysis, RECELL treatment for such patients was associated with an average 36% reduction in hospital length of stay compared to traditional split-thickness skin grafting. These findings reinforce prior clinical and retrospective studies demonstrating that RECELL use is associated with shorter hospitalizations and improved patient throughput in high-acuity burn care settings.

Further supporting the durability and generalizability of these outcomes, a global systematic synthesis of peer-reviewed clinical evidence evaluating RECELL was presented in September 2025. This review encompassed clinical studies across diverse wound etiologies, depths, patient populations, and care settings and demonstrated consistent trends toward reduced donor-site burden, faster healing, and decreased hospital length of stay and healthcare utilization compared to traditional grafting approaches. Collectively, this body of evidence supports RECELL as an evidence-based approach to wound healing with broad clinical applicability.

Adoption decisions in burn centers are typically evaluated through hospital value analysis committees (“VACs”), which assess both clinical outcomes and total cost of care. We have observed that surgeons often adopt RECELL first in larger and more complex burns, where the clinical and economic benefits are most pronounced, and subsequently expand use to smaller or less severe wounds as familiarity with the technology increases.

In the U.S., RECELL is reimbursed through established inpatient and outpatient reimbursement mechanisms. In the inpatient setting, hospitals receive payment under the Medicare Severity Diagnosis-Related Group (“MS-DRG”) system, which classifies hospital stays by diagnosis and procedures performed. For physicians, as well as in outpatient and ambulatory surgical center (“ASC”) settings, Current Procedural Terminology ("CPT") codes are used to describe procedures and support billing. On January 1, 2025, new Category I CPT codes (15011–15018) became effective to describe Skin Cell Suspension Autograft (“SCSA”) procedures performed using RECELL, replacing prior coding constructs and enabling standardized billing for healthcare providers. The Company continues to collaborate with both Medicare and commercial payers to expand coverage and ensure appropriate reimbursement for RECELL and its associated procedures, aiming to enhance patient access and support broader adoption in clinical practice.

The U.S. burn treatment market is highly concentrated, with approximately 140 specialized burn centers treating the majority of severe burn patients. Historically, our commercial focus has been centered on these burn centers, which continue to represent a core component of our customer base. With the expansion of RECELL indications to include full-thickness skin defects, we have broadened our commercial focus to additional trauma and surgical settings that treat complex acute wounds and often share clinical, operational, and economic characteristics with burn centers. Many burn centers are designated trauma centers, and adoption in these settings is supported by overlapping surgeon populations, similar care pathways, and comparable hospital value analysis and purchasing processes.

Full-Thickness Skin Defects

Full-thickness wounds arise from traumatic injuries, surgical wounds, and oncologic excisions and resections that extend through the dermal layer into deeper tissues. These acute wounds are frequently associated with significant tissue loss, contamination, and complex zones of injury, and they present many of the same challenges encountered in severe burns, including limited donor skin availability, risk of delayed healing, and the need for staged reconstruction.

RECELL is approved for the treatment of full-thickness skin defects, enabling clinicians to reduce donor skin harvesting while achieving wound closure outcomes comparable to conventional autografting. The clinical studies that supported FDA approval demonstrated statistically significant donor skin sparing with non-inferior healing outcomes relative to standard of care. In the U.S., we estimate that approximately 272,000 procedures annually may be eligible for treatment with RECELL across traumatic injuries, surgical wounds, and cancer-related resections. This indication materially expands our addressable market and allows us to leverage our existing commercial infrastructure and clinical relationships. Approximately half of U.S. burn centers are also designated trauma centers, and many trauma and surgical centers follow similar adoption and value analysis processes. As a result, the expansion into full-thickness skin defects represents a natural extension of our burn-focused business rather than the creation of a distinct new market.

From a reimbursement perspective, the same DRG code that is currently being used to treat inpatient burns is now being applied for the treatment of full-thickness skin defects.

Effective October 1, 2025, the Centers for Medicare & Medicaid Services ("CMS") approved a New Technology Add-On Payment ("NTAP") for RECELL when used in combination with meshed autograft for certain inpatient non-thermal full-thickness skin defects. NTAP provides incremental reimbursement above the applicable MS-DRG payment for a limited period, intended to support hospital adoption of innovative technologies like ours that demonstrate substantial clinical improvement.

Vitiligo

RECELL is approved for the repigmentation of stable depigmented vitiligo lesions. Vitiligo is a chronic autoimmune condition characterized by the loss of melanocytes, resulting in depigmented skin patches that can affect patients’ quality of life. Following FDA approval, we conducted post-market clinical and health economic studies to evaluate RECELL use in vitiligo, and these studies were published in 2025. Despite regulatory approval and demonstrated clinical benefit, reimbursement for vitiligo procedures remains limited and uncertain. As a result, we have paused further commercial investment in vitiligo at this time.

Cohealyx

Cohealyx is an AVITA-Medical branded collagen-based dermal matrix developed and commercialized pursuant to a multi-year exclusive development and distribution agreement with Regenity. Designed to support wound bed preparation, Cohealyx features an advanced bovine collagen-based design engineered to facilitate tissue integration and revascularization resulting in reduced treatment timelines and improved patient outcomes in full-thickness wounds.

Preclinical studies in porcine models demonstrated that Cohealyx generated robust tissue capable of consistently supporting a split-thickness skin graft in a two-stage procedure earlier than leading dermal matrices in the study. While animal model results do not necessarily translate to clinical results, this expedited timeline is anticipated to lead to quicker wound closure and streamlined clinician workflows, improving patient outcomes, and resulting in potential reduction in both treatment costs and hospital stays.

The FDA granted 510(k) clearance for Cohealyx on December 19, 2024, and we initiated commercial launch of Cohealyx in the United States on April 1, 2025.

In 2025, the first peer-reviewed clinical publication evaluating Cohealyx was published, reporting early clinical experience in complex full-thickness wounds. The case series provided initial clinical evidence supporting accelerated wound bed vascularization and readiness for autografting, consistent with prior preclinical findings. While limited in scope, these results support the intended role of Cohealyx as part of a two-stage wound management approach leading to definitive closure. To further develop clinical data, we are conducting a post-market clinical study of 40 patients to demonstrate Cohealyx’s performance in real-world settings, focusing on time-to-graft reduction in the treatment of full-thickness wounds and burns.

PermeaDerm

PermeaDerm is a biosynthetic wound matrix that we manufacture, and exclusively market and distribute in the U.S., under multi-year agreements with Stedical. It is FDA-cleared for the treatment of a variety of wound types and sizes until healing is achieved. PermeaDerm has three key attributes: (i) transparency, allowing clinicians to monitor wounds without frequent dressing changes; (ii) variable porosity, allowing clinicians to customize moisture management; and (iii) flexibility and adherency, allowing applications across a wide variety of wound presentations, including articulating joints. This trio of features supports use across acute care hospitals, burn centers, and surgical settings.

Within our portfolio, PermeaDerm complements RECELL by providing wound coverage before and after definitive closure, supporting wound management throughout the healing process. In addition, we are conducting a post-market clinical study, with approximately 40 patients enrolled, to evaluate the health economic impact of PermeaDerm compared to human cadaveric allograft.

INTERNATIONAL STRATEGY

Outside the U.S., RECELL has received regulatory approvals or registrations in multiple markets, including Australia, Europe, and Japan. In September 2025, RECELL GO received Conformité Européene (“CE”) mark approval, enabling commercialization in the European Union and other CE mark-recognizing markets. Our international commercialization strategy relies on third-party distributions rather than direct sales.

RESEARCH & DEVELOPMENT

Our research and development activities are focused on advancing our innovative products and building a comprehensive portfolio of solutions, as well as developing clinical applications to advance the management of wound care. Additionally, we continue to conduct clinical studies to provide further efficacy and health economic evidence.

SALES AND MARKETING

Our commercial organization is focused on clinical case support, staff training, and building awareness to further expand interest in the clinical and economic benefits of our acute wound care products. It is not uncommon in the treatment of wounds to have rotating staff and it is our commitment for all those working with our products to be comfortable with our technologies both during the procedure as well as during aftercare.

Our commercial organization is composed of highly experienced medical sales representatives as well as former burn and trauma nurses. This organization covers both burns and full-thickness skin defects.

HUMAN CAPITAL

As of December 31, 2025, we employed approximately 226 full-time and part-time employees, the majority of whom are based in the U.S. A significant number of our management and professional employees have prior experience with leading medical device, biotech, or pharmaceutical companies. None of our employees are covered by collective bargaining agreements.

We embrace differences, diversity and varying perspectives amongst our employee base and are proud to be an equal opportunity employer. We do not discriminate based on race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, military or veteran status, sexual orientation or any other protected characteristic established by federal, state, or local laws. A diverse workforce as well as an inclusive culture and work environment are fundamentally important and strategic to us, starting at the leadership level and extending to all levels of the Company. As of December 31, 2025, the Directors of the Company were 33% female, our senior executive team was 40% female, and our total employee base was 52.5% female.

INTELLECTUAL PROPERTY

Intellectual property, including patents, trade secrets, trademarks and copyrights, is critical to our business. Our commercial success depends in part on our ability to obtain and maintain proprietary intellectual property protection for our current products as well as for future product candidates and novel discoveries, product development technologies, and know-how. Our commercial success also depends in part on our ability to operate without infringing the proprietary rights of others and to prevent others from infringing our proprietary rights.

We protect our intellectual property, core technologies, and other know-how through a combination of patents, trademarks, trade secrets, and IP protection clauses in our agreements. Additionally, we rely on our research and development program, clinical trials, know-how and marketing programs to advance our products and product candidates, and to expand our intellectual property rights.

As of December 31, 2025, we had 6 issued U.S. utility patents, which are expected to expire between 2034 and 2043; 1 issued U.S. design patent, which is expected to expire in 2038, 7 pending U.S. utility patent applications, and 5 pending U.S. design patent applications. Additionally, as of December 31, 2025, we had 3 granted patents in Australia, 1 granted patent in Brazil, 1 granted patent in Canada, 1 granted patent in China, 1 granted patent in Hong Kong, 2 granted patents in Japan, 2 granted patents in Europe, each validated in Germany, Spain, France, Great Britain, and Italy, and 3 German utility models, which are expected to expire between 2033 and 2041; 4 certified registered designs in Australia, 2 design patents in China, 16 registered community designs in Europe, 2 design registrations in Japan, 16 registered designs in the United Kingdom, which are expected to expire between 2034 and 2050; and 5 pending patent applications in Australia, 1 pending patent application in Canada, 4 pending patent applications in China, 7 pending patent applications in Europe, 2 pending patent applications in Hong Kong, 4 pending patent applications in Japan, 1 pending patent application in New Zealand, 6 registered designs in Australia, 1 pending design patent in China, 5 pending design registrations in Japan, and 6 pending registered designs in New Zealand. The foregoing estimated expiration dates for the issued and granted patents do not account for potentially available patent term extensions and assume payment of appropriate maintenance, renewal, annuity and other governmental fees. Calculation of the expiration of issued or granted patents is complex, varies by country and is based upon many factors. Accordingly, the foregoing expiration dates are estimates.

Our owned U.S. and foreign patents and patent applications generally relate to devices for preparing regenerative epidermal suspensions for skin regeneration and wound healing, methods for harvesting and preparing cells for transplant or treatment of a tissue site, including automated preparations, methods of treating a tissue site with a regenerative epidermal suspension, methods of preparing a regenerative suspension with exogenous agents to promote wound healing, methods of evaluating the therapeutic potential of regenerative epidermal suspension, and methods of preparing a cell-free and allogeneic regenerative epidermal suspension supernatant.

Additionally, as of December 31, 2025, we owned 147 registered trademarks, common or state law trademarks, and 17 pending trademark applications, including “AVITA Medical,” the AVITA Medical logo, “RECELL,” “RECELL GO”, the RECELL GO logo, “RECELL GO mini”, “Spray-On Skin,” the RECELL logo, “Cohealyx,” the Cohealyx logo, and others in the U.S. and international markets.

FACILITIES

AVITA Medical leases approximately 17,500 square feet of administrative and office space in Valencia, California that is currently leased through October 31, 2026. We operate an FDA-registered production plant in Ventura, California, in a 27,840 square foot facility that is currently leased through September 30, 2030. We also lease a 3,360 square foot storage facility adjacent to our existing production plant in Ventura under a lease agreement that expires on September 30, 2030. We also have an administrative office lease in Irvine, California of approximately 10,700 square feet that is currently leased through the end of July 2028. We also lease a limited amount of incubator space in Irvine, California for scientific research and product development activities.

MANUFACTURING, SUPPLY AND PRODUCTION

We produce RECELL and PermeaDerm in our Ventura facility under current Good Manufacturing Practices (“cGMP”) and per ISO 13485, which also meets the regulatory requirements of other jurisdictions in which we sell RECELL. We maintain a state of regulatory compliance and inspection readiness at all times, and any future material changes to our production processes will be submitted for approval to the FDA and regulatory authorities in other jurisdictions as required.

Within the Ventura facility we perform the final manufacturing, assembly, packaging, and warehousing of RECELL and PermeaDerm. In August of 2025, we received approval from the FDA to conduct quality testing in house for U.S. products, and in October 2025 we received the same approval from our notified body for E.U. products. Bringing quality testing in house reduces our reliance on third-party test laboratories..

AVITA Medical sources multiple components, sub-assemblies, and materials from third-party suppliers, who are required to meet our cGMP quality specifications and associated regulatory requirements. To ensure continuity of supply, we maintain multiple sources of supply for key components, subassemblies and materials, and the majority of critical raw materials and services have multiple qualified suppliers. While a small number of materials remain single-sourced, we are actively working to qualify and validate additional suppliers for these materials as we continue to evaluate methods of removing risk from our supply chain. Additionally, in the second half of 2024, we implemented lean manufacturing methods to increase efficiencies in the production of RECELL. We believe that our current manufacturing capacity at the Ventura facility is sufficient to meet the expected commercial demand for burns, full-thickness skin injuries, and other indications under development, for the foreseeable future.

AVITA Medical ships its products directly from our Ventura facility to customers and distributors. From time-to-time we may also store small quantities of products at satellite distribution sites within the U.S. to better support access to our U.S. customers.

BARDA CONTRACT

BARDA, under the Assistant Secretary for Preparedness and Response, within the U.S. Department of Health and Human Services (“HHS”) has supported our company since 2015. A contract with BARDA provided funding for the development of the RECELL. The BARDA contract also supported the Company’s clinical trial in soft-tissue reconstruction, which led to the full-thickness skin defect indication. In addition to the clinical support provided by BARDA, we managed an inventory system of RECELL devices for BARDA to bolster emergency preparedness and support the logistics of emergency deployment of RECELL for use in mass casualty or other emergency situations. Between 2015 and December 31, 2025, we have received an aggregate total of $40.7 million in payments under the contract with BARDA.

As of December 31, 2023, we no longer have a contractual obligation to manage an inventory system for BARDA. However, from that date through September 28, 2025, we had an agreement to provide access to RECELL inventory in the event of a national emergency. Under that agreement, BARDA would pay for any devices requisitioned from this inventory along with a nominal annual maintenance fee to ensure first right of access. We anticipate BARDA will renew that agreement, but has been delayed due to the recent shutdown of the federal government.

COMPETITION

We currently believe that there is no direct competition for RECELL. Additionally, our innovative technology is supported by our expanding intellectual property portfolio and we believe that regulatory approval processes around the world will continue to provide additional and significant barriers to entry against meaningful competition. Despite these meaningful competitive advantages, the medical device, biotechnology, and pharmaceutical industries are highly competitive and subject to rapid advancements in technology, as well as changes in practice. In the future, we may face competition from various sources, including medical device, pharmaceutical, and wound care companies, academic and medical institutions, governmental agencies, medical practitioners, and public and private research institutions, among others. Consequently, any product that we successfully develop and/or commercialize will compete with both existing therapies and any new therapies that may emerge in the future.

In both the burn and non-burn wound markets, our indirect competitor is primarily split-thickness autografts. While RECELL complements autografts for the treatment of various wound injuries, split-thickness autografts represent the traditional surgical procedure and the current standard of care. However, based on our clinical trials and commercial experience, we believe that RECELL offers sustainable competitive, clinical, and economic advantages over the traditional surgical procedure. We also believe that our current portfolio products (Cohealyx and PermeaDerm)l enhance these advantages.

GOVERNMENT REGULATIONS

The production and marketing of our current products, as well as any additional product candidates developed in future ongoing research and development activities, are subject to regulation by numerous governmental authorities including the FDA in the U.S. and similar agencies in other countries throughout the world. Pursuant to its authority under the Federal Food, Drug, and Cosmetic Act (the “FD&C Act”), the FDA has jurisdiction over medical devices in the U.S. The FDA regulates the design, development, manufacturing, and distribution of medical devices to ensure that medical products distributed domestically are safe and effective for their intended uses. The FD&C Act classifies medical devices into one of three categories based on the risks associated with the device and the level of control necessary to provide reasonable assurance of safety and effectiveness. Devices deemed by the FDA to pose the greatest risk, such as life-sustaining, life-supporting or implantable devices, or devices deemed not substantially equivalent to a previously 510(k)-cleared device, are categorized as Class III. These devices typically require submission and approval of a PMA. RECELL is categorized as a Class III medical device, and in September 2018 the FDA granted our PMA for use in the treatment of acute thermal burns in patients 18 years and older. In June 2021, the FDA approved a supplement to our PMA to expand the use of RECELL in pediatric patients with full-thickness burns. In June 2023, the FDA approved both a supplement to our PMA to expand the use of RECELL for full-thickness skin defects and an original PMA to expand the use of RECELL for the repigmentation of stable depigmented vitiligo lesions. On May 29, 2024, the FDA approved our PMA supplement for RECELL GO, our next generation autologous cell harvesting device, to treat thermal burn wounds and full-thickness skin defects. On December 23, 2024, the FDA approved RECELL GO mini. Cohealyx and PermeaDerm have both received 510(k) clearance from the FDA.

To support additional PMAs or PMA supplements in the U.S. or applications for approval in other regions, the completion of additional clinical and non-clinical studies and supporting development activities will likely be required. Clinical trials can take many years to complete and require the expenditure of substantial resources. The length of time varies substantially according to the type, complexity, novelty, and intended use of the product candidate. We cannot make any assurances that once clinical trials are completed by us or a collaborative partner, we will be able to submit as scheduled a marketing approval request to the applicable governmental regulatory authority, or that such request and application will be reviewed and cleared by such governmental authority in a timely manner, or at all. Although we intend to make use of fast-track and abbreviated regulatory approval programs when possible and commercially appropriate, we cannot be certain that we will be able to obtain the clearances and approvals necessary for clinical testing or for manufacturing and marketing our product candidates. Delays in obtaining regulatory approvals could adversely affect the development and commercialization of our product candidates and could adversely impact our business, financial condition, and results of operations. During the course of clinical trials and non-clinical studies, product candidates may exhibit unforeseen and unacceptable safety considerations. If any unacceptable side effects were to occur, we may, or regulatory authorities may require us to, interrupt, limit, delay or abort the development of our potential products.

Any products manufactured or distributed by us pursuant to regulatory approvals are subject to continuing regulation by the FDA and similar agencies in other countries, including maintaining records supporting manufacturing and distribution under cGMP, periodic reporting, advertising, promotion, compliance with any post-approval requirements imposed as a conditional of approval, recordkeeping and reporting requirements, including adverse events experiences. After approval, material changes to the approved product, such as adding new indications or other labeling claims, or changes to the manufacturing process, are subject to prior approval by the FDA and other regulatory agencies. Medical device manufacturers and their subcontractors are required to register their establishments with the FDA, certain state agencies and international agencies. Subcontractors are subject to periodic announced and unannounced inspections by the FDA and other agencies for compliance with cGMP. We have established processes for the categorization of vendor criticality and the associated activities for qualification and monitoring of vendors. These activities include, but are not limited to, requiring certification of supplier in conformance to relevant cGMP requirements and other FDA and international agency regulatory requirements, approved supplier lists, and Company-conducted audits. In addition, all goods and services purchased from suppliers by us must be purchased from only those suppliers on the approved supplier list. Furthermore, the Company itself will continue to comply with all relevant FDA requirements and regulations and any applicable international agency regulatory requirements in its continued manufacturing and promotion of its FDA approved commercial products.

In addition to FDA approval in the U.S., RECELL has received various approvals and registrations in international markets. RECELL (including RECELL GO) has received CE-mark approval in Europe; RECELL, excluding RECELL GO, has received PMDA approval for burns in Japan and is TGA-registered in Australia.

HEALTHCARE LAWS AND REGULATIONS

AVITA Medical is a manufacturer of medical devices, and therefore we are subject to regulations by the FDA and various federal and state healthcare laws and regulations. These regulations govern our advertising and promotional practices, our interactions with healthcare providers (“HCPs”), and our reporting of any payments made to HCPs. AVITA Medical is committed to the highest standards of business conduct in accordance with the AdvaMed Code of Ethics on Interactions with Health Care Professionals (the “AdvaMed Code”). We are members of AdvaMed and have been AdvaMed-certified since December 2025, reflecting our commitment to ethical, transparent, and compliant interactions with healthcare providers.

Interactions with Healthcare Providers

Providing any benefits or advantages to HCPs in order to induce or encourage the use or referral of AVITA products is strictly prohibited by both U.S. and international laws and regulations. Restrictions under applicable federal and state healthcare laws and regulations include but are not limited to the following:

Additionally, certain state laws require medical device companies to comply with voluntary guidelines in our interactions with healthcare providers promulgated by global trade associations and relevant compliance guidance issued by the HHS, Office of Inspector General. Such guidelines prohibit medical device manufacturers from offering or providing certain types of payments or gifts to health care providers; and/or require the disclosure of gifts or payments to healthcare providers. We maintain a robust compliance program designed to meet applicable federal and state laws and to align with recognized industry standards, including the AdvaMed Code and relevant HHS Office of Inspector General guidance.

Interactions with Foreign Officials and Entities

The U.S. Foreign Corrupt Practices Act (“FCPA”) prohibits any U.S. individual or business from paying, offering, or authorizing payment or offering of anything of value, directly or indirectly, to any foreign official, political party, or candidate for the purpose of influencing any act or decision of the foreign entity in order to assist the individual or business in obtaining or retaining business. The FCPA also obligates companies whose securities are listed in the U.S. to comply with accounting provisions requiring companies to maintain books and records that accurately and fairly reflect all transactions of companies, including international subsidiaries, and to devise and maintain an adequate system of internal accounting controls for international operations. We are also subject to similar regulations under the Australian bribery laws and other anti-corruption laws that apply in countries where we do business.

Federal and State Reporting

Pursuant to the federal National Physician Payment Transparence Program (Open Payments) Act, AVITA Medical is required to annually report certain payments or transfers of value to HCPs annually to CMS. In addition to adhering to these federal reporting requirements, we are required to make similar annual reports to relevant state agencies.

Privacy

Various federal, state, and foreign laws govern the privacy and security of consumer and patient information. We comply with all such applicable laws.

ENVIRONMENTAL, HEALTH AND SAFETY MATTERS

We are subject to extensive environmental, health and safety laws and regulations in a number of jurisdictions, primarily in California and the U.S., governing, among other things: the use, storage, registration, handling, emission and disposal of chemicals, waste materials and sewage; chemicals, air, water and ground contamination; and air emissions and the cleanup of contaminated sites, including any contamination that could result from spills due to our failure to properly dispose of production waste materials. Our operations at our Ventura manufacturing facility produce a small amount of waste materials that are considered minimally hazardous, and we use a third-party waste disposal company to remove any waste generated during operations from the facility. Our activities require permits from various governmental authorities including local municipal authorities. Local and state authorities may conduct periodic inspections in order to review and ensure our compliance with the various regulations. We are not presently aware of any material violations or deficiencies relating to these requirements. These laws, regulations and permits could potentially impose additional costs related to compliance or remediation.

AVAILABLE INFORMATION

The Company files annual, quarterly and current reports, proxy statements and other documents with the Securities and Exchange Commission (“SEC”) under the Securities Exchange Act of 1934 (the “Exchange Act”). The SEC maintains a website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. The public can obtain any documents that we file with the SEC at www.sec.gov. In addition, copies of announcements made by the Company to ASX are available on the ASX website (www.asx.com.au) and also, under the heading “Investors: Press Releases” at the following link on our website https://ir.avitamedical.com/press-releases/news-releases. Our filings with the SEC, including without limitation, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act, are available free of charge on our website under the heading “Investors: Financials _SEC Filings” at the following link on our website (https://ir.avitamedical.com/financials/sec-filings), as soon as reasonably practicable after we file or furnish them electronically with the SEC. We maintain a website at www.avitamedical.com. Information contained on our website is not part of or incorporated into this Annual Report.

Item 1A. RISK FACTORS

Our business faces significant risks. You should carefully consider all of the information set forth in this annual report, including the following risk factors. Our business, results of operations, and financial condition could be materially and adversely affected by any of these risks, and in such event, the trading price of our common stock would likely decline, and you might lose all or part of your investment. This Annual Report also contains forward-looking statements that involve risks and uncertainties, and our results could materially differ from those anticipated in these forward-looking statements. See “Forward-Looking Statements” included elsewhere within this Annual Report for a discussion of certain risks, uncertainties and assumptions associated with these statements.

Risks Related to Our Business Operations

We have experienced significant losses, expect losses to continue for the foreseeable future and may never achieve or maintain profitability.

Although we have begun full scale marketing and sales of our products in the United States and other jurisdictions, we have not yet achieved profitability. We had a total net loss of $48.6 million and $61.8 million for the year ended December 31, 2025 and 2024, respectively. We have incurred a cumulative deficit of $408.4 million through December 31, 2025. We anticipate that we may continue to incur losses at least until sales of our products are adequate to fund operating expenses. We may not be able to successfully achieve or sustain profitability. Successful transition to profitable operations is dependent upon achieving a level of revenues adequate to support our cost structure, including in new markets where regulatory approval is in process or pending.

Servicing our debt requires a significant amount of cash and we are subject to a number of restrictive covenants relating to our indebtedness, which may restrict our business and financing activities.

We had previously entered into a credit agreement with OrbiMed Advisors, LLC (as amended, the “Previous Credit Agreement”) on October 18, 2023, most recently amended in the Previous Credit Agreement’s Sixth Amendment, on November 5, 2025 (the “Sixth Amendment”) and incurred $40.0 million of indebtedness secured by substantially all of our assets.

On January 13, 2026, we entered into a new Credit Agreement and Guaranty (the “Perceptive Credit Agreement”), and Security Agreement (the “Security Agreement”), by and among us, as borrower, Avita Medical Americas, LLC, a wholly-owned subsidiary of the Company, as guarantor (the “Guarantor,” taken together with the Company, the “Obligors”) and Perceptive Credit Holdings V, LP as a lender and the administrative agent (the “Lender,” and the “Administrative Agent,” as applicable). The Perceptive Credit Agreement provides for a five-year senior secured credit facility in an aggregate principal amount of up to $60 million (the “Loan Facility”), of which (i) $50 million was funded on the Closing Date (the “Initial Commitment Amount”) and (ii) $10 million will be made available, at our discretion by notice to the Administrative Agent on or before March 31, 2027, subject to satisfaction of a certain net revenue requirement (the “Additional Commitment Amount”). On the Closing Date, we closed on the Initial Commitment Amount, less certain fees and expenses payable to or on behalf of the Lender. Simultaneously with the closing of the Initial Commitment Amount, we repaid in full and terminated all of obligations and commitments (other than previously issued warrants) (the “Refinancing Transaction”)[1] under the Previous Credit Agreement.

This level of debt could have significant consequences on future operations, including increasing our vulnerability to adverse economic and industry conditions and limiting our flexibility in planning for, or reacting to, changes in our business and the markets in which we compete.

Our ability to make scheduled payments of interest depends on our future performance, which is subject to interest rate risk, as well as economic, financial, competitive, and other factors beyond our control. We are exposed to risks related to a potential rising interest rate environment for the debt, which could cause our borrowing costs to rise and impact our liquidity. Our business may not generate cash flow from operations in the future sufficient to service our debt in cash while simultaneously making necessary capital expenditures. In addition, if the Company’s net revenue does not equal or exceed a certain amount for upcoming fiscal periods as set forth in the Perceptive Credit Agreement, then the Company will be in default of the Perceptive Credit Agreement.

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[1]Additional details concerning the Perceptive Credit Agreement, the Security Agreement, and the Refinancing Transaction are provided in Item 7, infra.

If we are unable to generate sufficient cash flow to satisfy payment obligations under the Perceptive Credit Agreement, we may be required to adopt one or more alternatives, such as obtaining additional equity capital on terms that may be onerous or highly dilutive. We may not be able to engage in any of these activities, or such activities may only be available to the Company on undesirable terms, which could result in a default on our debt obligations.

The restrictions and covenants in the Perceptive Credit Agreement may also prevent us from taking actions that we believe would be in the best interests of our business, and may make it difficult for us to successfully execute our business strategy or effectively compete with companies that are not similarly restricted. Our ability to comply with these covenants in future periods will largely depend on the success of our products, and our ability to successfully implement our overall business strategy. We may be unsuccessful in obtaining waivers or amendments to restrictions and covenants in certain agreements with our customers or counterparties. And any breach by the Company of covenants and restrictions in such agreements could result in a default under the Perceptive Credit Agreement, which could result in an acceleration of the repayment of our indebtedness.

We may require additional financing in the future to continue the development and commercialization of our current and future products, which may cause dilution to our existing stockholders. If additional financing is not available, we may have to postpone, reduce or cease operations.

If we are unable to achieve profitability sufficient to permit us to fund our operations, repay indebtedness in accordance with the Perceptive Credit Agreement, and take other planned actions, we may be required to raise additional capital. There can be no assurance that such capital would be available on favorable terms, or available at all. If we raise additional capital through the issuance of equity, the percentage ownership held by existing stockholders may be reduced, and the market price of our common stock or CDIs could fall due to an increased number of shares or CDIs available for sale in the market. If we are unable to secure additional capital as circumstances require, we may not be able to fund our planned activities or continue our operations.

The markets in which we operate are highly competitive and innovative. Our competitors may develop products that render our products less attractive or obsolete and our business may deteriorate.

The markets for our products are highly competitive and our competitors may develop products that may more effectively compete with our products. Our competitors may have significantly more financial and other resources to invest in product development. We must, therefore, continue to develop and market new products, or we risk our products becoming obsolete, in which case, our revenues may decline, adversely impacting our financial condition or our business prospects.

Our success depends, in part, on our relationships with, and the efforts of, third-party distributors.

We rely on third-party distributors for a portion of our sales in countries outside of the U.S. Our distributors may not commit the necessary resources to market and sell our products to the level of our expectations, and, regardless of the resources they commit, they may not be successful. If we are not able to maintain our distribution network, if our distribution network is not successful in marketing and selling our products, or if we experience a significant reduction, cancellation, or change in the size and timing of orders from our distributors, our revenues could decline significantly and lead to an inability to meet operating cash flow requirements, which would have a material adverse effect on our business, financial condition, or results of operations.

Certain of our products are dependent on specialized sources of supply potentially subject to disruption which could have a material, adverse impact on our business.

Due to the cost and regulatory requirements associated with qualifying multiple suppliers, in 2023, we single-sourced some of our material components. To the extent that any of these single-sourced suppliers experience disruptions in deliveries due to production, quality, or other issues, we are potentially subject to similar production delays or unfavorable cost increases. In 2024, we started investing resources to secure additional suppliers for some of our key raw materials, but these efforts only mitigate, but do not eliminate, our supply chain risk.

We rely on third parties to conduct, supervise, and monitor our clinical trials. If these third parties do not successfully carry out their contractual duties or meet expected deadlines, we may not be able to obtain or maintain regulatory approval for or commercialize our products and our business could be substantially harmed.

We rely on clinical research organizations (“CROs”) and clinical trial sites to ensure our clinical trials are conducted properly and on time. While we have agreements governing their activities, we have limited influence over their actual performance. CROs manage and monitor the duties and functions pertaining to clinical trials and we control only certain aspects of our CROs’ activities. Nevertheless, we remain responsible for ensuring that each of our clinical trials is conducted in accordance with applicable protocol, legal, regulatory, and scientific standards, and our reliance on CROs does not relieve us of our such responsibilities.

We and our CROs are required to comply with the FDA’s GCPs for conducting, recording, and reporting the results of clinical trials to assure that the data and reported results are credible and accurate and that the rights, integrity, and confidentiality of clinical trial participants are protected. The FDA, and comparable foreign regulatory authorities, enforce these GCPs through periodic inspections of trial sponsors, principal investigators, and clinical trial sites. If we or our CROs fail to comply with applicable GCPs, the clinical data generated in our future clinical trials may be deemed unreliable and the FDA or other foreign regulatory authorities may require us to perform additional clinical trials before approving any marketing applications.

If our CROs do not successfully carry out their contractual duties or obligations, fail to meet expected deadlines, or if the quality or accuracy of the clinical data they obtain is compromised due to the failure to adhere to our clinical protocols or regulatory requirements, or for any other reasons, our clinical trials may be extended, delayed or terminated, and we may not be able to obtain or maintain regulatory approval for, or successfully commercialize, our products. If any such event were to occur, our financial results and the commercial prospects for our products would be harmed, our costs could increase, and our ability to generate revenues could be delayed. If any of our relationships with these third-party CROs terminate, we may not be able to enter into arrangements with alternative CROs or to do so on commercially reasonable terms. Further, switching or adding additional CROs involves additional costs and requires management resources. In addition, there is a natural transition period when a new CRO commences work. As a result, delays occur, which could materially impact our ability to meet our desired clinical development timelines. Though we carefully manage our relationships with our CROs, there can be no assurance that we will not encounter challenges or delays in the future or that these challenges or delays will not have a material adverse impact on our business, financial condition, or results of operations.

We may encounter substantial delays in further clinical studies necessary to support regulatory applications for additional commercial applications of our technology.

We cannot guarantee that any pre-clinical testing or clinical trials will be conducted as planned or on schedule, or completed at all. As a result, we may not achieve the expected clinical milestones necessary for approval by the FDA, or other regulators, for the use of our products for additional applications or indications in the United States or other countries.

A failure in a clinical study or regulatory application can occur at any stage. Events that may prevent successful or timely

commencement, enrollment or completion of a clinical study or a regulatory application include:

Delays, including delays caused by the above factors, can be costly and could negatively affect our ability to complete clinical trials for our product candidates. If we are not able to successfully complete clinical trials or are not able to do so in a timely and cost-effective manner, we will not be able to obtain regulatory approval for the use of our products for additional applications or indications, all of which could have a material adverse effect on our business, financial condition, or results of operations.

Product development is an expensive, uncertain and lengthy process.

We have significant product development projects ongoing that, if successful, are intended to continue to improve the consistency and ease for the use of RECELL across indications and wound sizes, as well as expand our portfolio of complementary products. The costs, timeline, and ultimate success of these product development programs are subject to risk and uncertainty. If we are not able to develop and obtain regulatory approval for our new products in a timely fashion and within budget, our business prospects and financial condition may suffer.

Development and commercialization of our products require successful completion of the regulatory approval process and may suffer delays or fail.

In the United States, as well as other jurisdictions, we have been and will be required to apply for and receive regulatory authorization before we can market our products. We may require additional clinical data or approvals from regulatory authorities within the jurisdictions in which we operate to market improved versions of RECELL for the same or additional indications, and from any other jurisdictions in which we seek to market the product. This process can be time-consuming and complicated, and may result in unanticipated delays or fail altogether.

To secure marketing authorization, an applicant generally is required to submit an application that includes the data supporting pre-clinical and clinical safety and effectiveness as well as detailed information on the manufacturing and control of the product, proposed labeling, and other additional information. Before marketing authorization is granted, regulatory authorities may require the inspection of the manufacturing facility and quality systems (including those of third parties) at which the product candidate is manufactured and tested, as well as potential audits of the non-clinical and clinical trial sites that generated the data cited in the marketing authorization application.

We cannot predict whether any additional marketing authorizations will ultimately be granted or how long the applicable regulatory authority or agency approval processes will take. Regulatory agencies, including the FDA, have substantial discretion in the approval process. In addition, the approval process and the requirements governing clinical trials vary from country to country. The policies of the FDA or other regulatory authorities may change, and additional government regulations may be enacted that could prevent, limit or delay the necessary approval of any products we may develop and commercialize. We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or elsewhere. If we are slow or unable to adapt to new or changed requirements, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we may have obtained, which may impact our ability to achieve or sustain profitability.

Additionally, any future regulatory approvals that we receive may also contain requirements for costly post-marketing testing and surveillance to monitor the safety and effectiveness of the product. Once a product is approved, the manufacturing processes, labeling, packaging, distribution, adverse event reporting, storage, advertising, promotion, import, export, distribution, and record-keeping for the product will be subject to extensive and ongoing regulatory requirements. These requirements include submission of safety and other post-marketing reports, registration, and continued compliance with good manufacturing practices (including for any clinical trials that we conduct post-approval).

Finally, per FDA regulations, changes made to products, specifications, or test data evaluation methodology would generally require communication with the FDA. There are several pathways for communicating with the FDA of such changes. As part of such review, the FDA may request additional information, at which time the product may become temporarily unavailable.

We are highly dependent on our regulatory approval in the United States and failure to maintain that approval would materially impact our business and prospects.

Our business is highly dependent on the PMA we received in September 2018 from the FDA, including subsequent PMA supplement approvals for acute wound indications. This PMA allows us to sell RECELL and RECELL GO in the United States, our current primary market. While we intend to take every action and precaution to ensure that our PMA remains effective, it is possible that the FDA could take a position in the future that requires a modification, temporary suspension or revocation of our PMA. Any such action by the FDA would have a material adverse effect on our business.

Obtaining and maintaining regulatory approval for a product in one jurisdiction does not mean that we will be successful in obtaining regulatory approval for that product in other jurisdictions.

Obtaining and maintaining regulatory approval for a product in one jurisdiction does not guarantee that we will be able to obtain or maintain similar approval in other jurisdictions; further, a failure or delay in obtaining regulatory approval in one jurisdiction may have a negative effect on the regulatory approval process in others. For example, even though the FDA has granted marketing approval for use of RECELL in the treatment of full-thickness skin defects and vitiligo, comparable regulatory authorities in foreign jurisdictions must also approve the manufacturing, marketing, and promotion of the product in those jurisdictions if not currently approved. Approval procedures vary among jurisdictions and can involve requirements and administrative review periods different from, and greater than, those in the United States, including the requirement in such jurisdictions of additional clinical studies due to clinical trials conducted in one jurisdiction not being accepted by regulatory authorities in other jurisdictions. In addition, in certain jurisdictions outside the United States, the reimbursement and/or intended price of a medical device must be approved before it can be approved for sale in that jurisdiction.

Product recalls or inventory losses caused by unforeseen events may adversely affect our operating results and financial condition.

Our products are manufactured, stored, and distributed using technically complex processes requiring specialized facilities, highly specific raw materials and other production constraints. The complexity of these processes, as well as strict company and government standards for the manufacture, storage, and distribution of our product candidates, subject us to risks. In addition, process deviations or unanticipated effects of approved process changes may result in production runs of our products not complying with stability requirements or specifications. The occurrence or suspected occurrence of production and distribution difficulties can lead to lost inventories and in some cases product recalls, with consequential reputational damage and the risk of product liability. The investigation and remediation of any identified problems can consume management resources and cause production delays, substantial expense, lost sales, and delays of new product launches. In the event our production efforts require a recall or result in an inventory loss, our operating results and financial condition may be adversely affected.

We face manufacturing risks that may adversely affect our ability to manufacture products and could reduce our gross margins and negatively affect our business and operating results.

Our success depends, in part, on our ability to manufacture our current and future products in sufficient quantities and on a timely basis to meet demand, while managing manufacturing costs, while continuing to adhere to product quality standards and comply with regulatory quality system requirements. We have a manufacturing facility located in Ventura, California where we produce, package, and warehouse RECELL and PermeaDerm. We also rely on global third-party manufacturers for production of some of the components used in RECELL. If our facility or the facilities of our third-party contract manufacturers suffer damage or experience a force majeure event, this could materially impact our ability to operate.

We are also subject to other risks relating to our manufacturing capabilities, including:

As demand for our products increases, we will have to invest additional resources to purchase raw materials and components, sub-assemblies, and materials, hire and train employees, and enhance our manufacturing processes. If we fail to increase our production capacity efficiently to meet demand for our products, we may not be able to fill customer orders on a timely basis, our sales may not increase in line with our expectations, and our operating margins could fluctuate or decline. It may not be possible for us to manufacture our products at a cost or in quantities sufficient to make these products commercially viable or to maintain current operating margins, all of which could have a material adverse effect on our business, financial condition, or results of operations. Accordingly, we are continually identifying additional third-party suppliers who could serve as replacement suppliers should the need arise.

Compliance with environmental, health and safety requirements is costly and, if not achieved, could result in material financial fines, costly litigation, and a material adverse impact on the business.

Our manufacturing and other processes may involve the use of hazardous materials subject to federal, state, local, and foreign environmental requirements. Under some environmental laws and regulations, we could be held responsible for costs at third-party sites that we have used for waste disposal, or for contamination at our past or present facilities. Failure to comply with current or future environmental laws or regulations could result in significant fines and expenses which could have an adverse impact on our financial condition or business prospects.

We may be subject to civil fines and/or criminal penalties if the FDA determines that we have marketed or promoted our products for off-label usage.

If the FDA determines that our marketing activities constitute off-label promotion, the FDA could impose civil fines or even criminal penalties on the Company and our executives, withdraw or recall our approved product from the market, as well as limit our products from such off-label usage.

We rely on information technology systems for critical business functions and the operations of our business.

We rely upon complex, integrated information technology (“IT”) systems in our business functions including our quality systems to operate our business. If any of our IT systems were to be disrupted or fail, our business could suffer irreparable harm, including financial loss, adverse impact to our operations, and reputational damage.

A cyber security incident could be disruptive to our business, compromise confidential data, cause reputation harm, and subject us to litigation and federal and state governmental inquiries.

We collect and store sensitive business and other information, such as sensitive intellectual property, on our IT systems. Our business operations are dependent upon the secure maintenance of these IT systems and this information. Despite the implementation of security measures, our IT systems and those of our vendors and customers are vulnerable to attack and damage from computer viruses, malware, denial of service attacks, unauthorized access, or other harm, including from threat actors seeking to cause disruption to our business. We face risks related to the disruption of the confidentiality, integrity, and availability of our IT systems and the information that we maintain—or engage a third-party to maintain on our behalf—including unauthorized access, acquisition, use, disclosure, or modification of such information. Cyberattacks are increasing in their frequency, sophistication, and intensity and have become increasingly difficult to detect. Cyberattacks could include the deployment of harmful malware, ransomware, denial-of-service attacks, social engineering, and other means to affect service reliability and threaten the confidentiality, integrity, and availability of information. Beyond external criminal activity, systems that access or control access to our services and databases may be compromised as a result of human error, fraud or malice on the part of employees or third parties, or may result from accidental technological failure. A material cyberattack or security incident could cause interruptions in our operations and could also damage our reputation, financial condition, and results of operations.

We receive, collect, process, use, and store a large amount of information from our customers and our own employees, including personal information and other sensitive and confidential information. If threat actors are able to circumvent or breach our security systems, they could steal any information located therein or cause serious and potentially long-lasting disruption to our operations. Security breaches or attempts thereof could also damage our reputation and expose us to a risk of litigation, sanctions, and/or monetary loss. We also face risks associated with security breaches affecting third parties that conduct business with us or our customers and others who interact with our data. While we maintain insurance that covers certain security incidents, we may not carry appropriate insurance or maintain sufficient coverage to compensate for damage from all events and related potential liability.

We are subject to diverse laws and regulations relating to data privacy and security, such as federal and state data protection regulations, including the California Consumer Privacy Act, as amended, and European data privacy laws, including the General Data Protection Regulation. Complying with these numerous and complex regulations is expensive and difficult, and failure to comply with these regulations could result in regulatory scrutiny, civil liability and related fines, or damage to our reputation. In addition, any security breach or attempt thereof could result in liability for stolen assets or information, additional costs associated with repairing any system damage, and implementation of measures to prevent future breaches, including organizational changes, deployment of additional personnel and protection technologies, increased employee training, and engagement of third-party experts and consultants. The costs incurred to remediate any security incident could be substantial. We cannot guarantee that any costs and liabilities incurred in relation to an attack or incident will be covered by our existing insurance policies or that applicable insurance will be available to us in the future on economically reasonable terms or at all.

In addition, we cannot assure that any of our third-party service providers with access to our sensitive or confidential information, or to that of our customers and/or employees, will not experience security breaches or attempts thereof, which could have a corresponding effect on our business.

Tariffs and Changes in Trade Policy Could Adversely Affect Our Business, Financial Condition, and Results of Operations

We currently derive less than 5% of our net sales from international operations and a de minimus portion of our raw materials and components are sourced internationally. The sale and shipment of our products across international borders, as well as the purchase of materials and components from international sources, subject us to U.S. and foreign governmental trade regulations, including those related to duties, and tariffs. Recent shifts in U.S. trade policy and the imposition of tariffs on imports from certain countries, as well as retaliatory tariffs imposed by those countries on U.S. goods, may negatively impact our business, results of operations, and financial condition. We cannot predict the future direction of trade policy or the impact of any future trade restrictions or retaliatory measures that may further impact our business.

Risks Relating to our Industry and Technology

We face competition from the existing standard of care and any future potential changes in medical practice and technology and the possibility that our competitors may develop products, treatments or procedures that are similar, more advanced, safer or more effective than ours.

The medical device, biotechnology and pharmaceutical industries, specifically relating to the areas where we currently or intend to market our products, are intensely competitive and subject to significant changes due to technology and medical practice standards. We may face competition from any number of different sources with respect to any products we develop and commercialize.

Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products, treatments or procedures that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than our current products or any future products we develop. Many of our current or future competitors may have significantly greater financial resources and experience in research and development, manufacturing, pre-clinical testing, conducting clinical trials, obtaining regulatory approvals, and marketing approved products than we may have. Mergers and acquisitions in the medical device, pharmaceutical, and biotechnology industries, or specifically in the wound care markets, may result in increased concentration of resources among a smaller number of our competitors. Other early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These companies compete with us in recruiting and retaining qualified scientific and management personnel, establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies necessary for, or complementary to, our products.

If we are unable to effectively protect our intellectual property, we may not be able to operate our business and third parties may be able to use and profit from our technology, both of which would impair our ability to be competitive.

Our success will be heavily dependent on our ability to obtain and maintain meaningful patent protection for our technologies and products throughout the world. Patent law relating to the technology fields in which we operate continues to evolve. The amount of protection to maintain over our proprietary rights, therefore, is uncertain. Further, the validity and enforceability of our patent portfolio cannot be predicted with certainty. We rely on patents to protect a significant part of our intellectual property and to enhance our competitive position. However, our presently pending or future patent applications may be denied, and any patent previously issued to us may be challenged, invalidated, held unenforceable or circumvented. Our patents have expected expiration dates ranging from 2032 to 2033, while our pending patent applications, if granted, would have expiration dates ranging from 2034 to 2043. Furthermore, our issued patents may not be broad enough to prevent competitors from producing products similar to ours, and we have products that we continue to commercialize that were covered by patents that are now expired.

In the ordinary course of business and as appropriate, we intend to apply for additional patents covering both our technologies and products, as we deem appropriate. Our existing patents and any future patents we obtain may not be sufficiently broad to prevent others from practicing our technologies or developing competing products and technologies.

We may find it difficult to protect our intellectual property rights throughout the world.

Filing, prosecuting and enforcing patents on all of our technologies and products in every jurisdiction is expensive. Competitors could reverse engineer our technologies in jurisdictions where we have not obtained patent protection to develop their own products. These products may compete with our products and may not be covered by any of our patent claims or other intellectual property rights.

The laws of some countries do not protect intellectual property rights to the same extent as the laws of the United States and many companies have encountered significant problems in protecting and defending such rights in foreign jurisdictions. This lack of protection could make it difficult for us to stop third parties from infringing our patents. Proceedings to enforce our patent rights in the U.S. or foreign jurisdictions could result in substantial cost and divert the efforts and attention of key personnel from other aspects of our business. If we fail to obtain adequate patent protection for our proprietary technology, our ability to be commercially competitive internationally will be materially impaired.

If third parties make claims of intellectual property infringement against us, or otherwise seek to establish their intellectual property rights equal or superior to ours, we may have to spend time and money in response and potentially discontinue certain of our operations.

While we currently do not believe it to be the case, third parties may claim that we are employing their proprietary technology without authorization or that we are infringing their patents. Third parties may assert infringement claims against us based on existing patents or patents that may be granted in the future, regardless of their merit. If such claims were made, we could incur substantial costs coupled with diversion of key technical personnel in defending against these claims and/or challenging the validity of any asserted patent before a court or administrative agency. Even if we believe such claims are without merit, parties making claims against us may be able to obtain injunctive or other equitable relief that could effectively halt our ability to further develop, commercialize, and sell products. In the event of a successful claim of infringement, courts may order us to pay damages and obtain one or more licenses from third parties. We may not be able to obtain these licenses at a reasonable cost, if at all. Defense of any lawsuit or failure to obtain any of these licenses could prevent us from commercializing available products and have a material adverse effect on our financial condition and business prospects.

Moreover, given the vast number of patents in our field of technology, we may infringe existing patents, and we may infringe patents that may be granted in the future. While we may decide to initiate proceedings to challenge the validity of these or other patents in the future, we may not be successful, and courts or patent offices in the United States and abroad could uphold the validity of any such patent. Furthermore, because patent applications can take many years to issue and may be confidential for 18 months or more after filing, and because pending patent claims can be revised before issuance, there may be applications now pending that may later result in issued patents that may be infringed by the manufacture, use or sale of our products. We may fail to identify relevant third-party patents or patent applications, regardless of when filed, or we may incorrectly conclude that a third-party patent is invalid or not infringed by our products or activities.

We may incur substantial costs as a result of litigation or other proceedings relating to patent and other intellectual property rights and we may be unable to protect our rights to, or use of, our technology.

If we choose to go to court to stop someone else from using the intellectual property claimed in our patents, that individual or company has the right to ask a patent office or a court to rule that these patents are invalid and/or should not be enforced against that third party. These lawsuits or proceedings are expensive and would distract our key personnel and consume time and other resources, even if we were successful in stopping the infringement of these patents. In addition, there is a risk that a patent office or a court will decide that our patents are invalid or unenforceable and that we do not have the right to stop the other party from using the inventions or, even if the validity or enforceability of these patents is upheld, the court may refuse to stop the other party because the competitors’ activities do not infringe our rights. Furthermore, even if our patents are found to be valid and infringed, a court may refuse to grant injunctive relief against the infringer and instead grant us monetary damages and/or ongoing royalties. Such monetary compensation may be insufficient to adequately offset the damage to our business caused by the infringer’s competition in the market.

We could be subject to product liability lawsuits, which could result in costly and time-consuming litigation and significant liabilities.

The development of medical device products such as RECELL involves an inherent risk of product liability claims and associated financial liability and adverse publicity. Any products we may develop could be found to be harmful or to contain harmful substances and expose us to substantial liability and risk of litigation or may force us to discontinue production. We may be unable to obtain or maintain insurance on reasonable terms or otherwise protect ourselves against potential product liability claims that could impede or prevent further business development of any products we may create and commercialize. Furthermore, a product liability claim could damage our reputation, regardless of the claim’s merit or whether liability for such claims is covered by insurance. A product liability claim against us or the withdrawal of a product from the market could have a material adverse effect on our financial condition or business operations. Furthermore, product liability lawsuits, regardless of their success, would likely be time-consuming and expensive to resolve and would divert management’s time and attention, which could seriously harm our business.

The continued successful commercialization of our products for FDA approved and pending indications, will depend in part on the extent to which government authorities and healthcare insurers establish adequate reimbursement levels and pricing policies.

Continued sales of our products depend in part on the availability of coverage and reimbursement from third-party payers such as government insurance programs, including Medicare and Medicaid, private health insurers, health maintenance organizations and other healthcare-related organizations, who are increasingly challenging the price of medical device products and services.

Both the federal and state governments in the United States continue to propose and pass new legislation, regulations, and policies affecting coverage and reimbursement rates, which are designed to contain or reduce the cost of health care. Continued federal and state proposals and healthcare reforms are likely, which could limit the prices that can be charged for our products and may further limit our commercial opportunity.

While many of these initiatives are focused on pharmaceuticals, these measures may impact our products, or analogous measures may be introduced that target our products. For example, the Inflation Reduction Act, or the IRA, was enacted in 2022. Among other things, the IRA replaces the Part D coverage gap discount program with a new manufacturer discounting program (which began in 2025). The IRA permits the Secretary of HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial years. HHS has and will continue to issue and update guidance as these programs are implemented, although the Medicare drug price negotiation program is currently subject to legal challenges. The impact of the IRA on our business and the medical device industry cannot yet be fully determined, but is likely to be significant.

The One Big Beautiful Bill Act, which was enacted in July 2025, imposes significant reductions in the funding of the Medicaid program. Such reductions are expected to decrease the number of persons enrolled in Medicaid and reduce the services covered by Medicaid, which could adversely affect our sales of our products.

There also may be future changes unrelated to the IRA that result in reductions in potential coverage and reimbursement levels for our products, and we cannot predict the scope of any future changes or the impact that those changes would have on our operations. For example, the Trump administration is aggressively pursuing a pharmaceutical pricing policy that would tie prices in the U.S. to prices in other countries. Adoption of such a mechanism in one part of the healthcare sector lowers the barrier to imposing similar approaches in other sectors of our industry. Cost control initiatives may decrease coverage and payment levels and, in turn, impact the prices that we will be able to charge and/or the volume of our sales. We are unable to predict all changes to the coverage or reimbursement methodologies that will be applied by private or government payers. Any denial of private or government payer coverage, as well as other federal, state, and foreign healthcare reform measures that have been and may be adopted in the future, or inadequate reimbursement, could reduce our revenue and business prospects.

We may be unsuccessful in commercializing our current products or other future products due to unfavorable pricing regulations or third-party coverage or reimbursement policies.

We cannot guarantee that we will receive favorable pricing or reimbursement for use of our products. The rules and regulations that govern pricing and reimbursement for medical products vary widely from country to country or from indication to indication, and within the United States, can also vary widely from one health system or hospital to the next. In some foreign jurisdictions, including the EU and the individual jurisdictions within it, the government largely controls pricing of medical products. In other countries, coverage negotiations must occur at the regional or hospital level. Pricing negotiations can take considerable time after the receipt of marketing approval for a medical product.

As a result, even after obtaining regulatory approval for a product in a particular country, we may be subject to price regulations or limited reimbursement, which may delay or limit our commercial launch of the product and negatively impact the revenue we are able to generate from the sale of the product in that country. Further, such pricing limitations may hinder our ability to recoup our total investment in our current products or other future products. If we are unable to promptly obtain coverage and profitable payment rates from hospital budgets, as well as from either government-funded or private purchasers, for our current products or any future products, this could have a material adverse effect on our operating results, our ability to raise capital needed to commercialize products, and our overall financial condition.

For example, we presently benefit from various reimbursement codes, including the following:

There can be no guarantee that the above reimbursement codes will not be withdrawn, reduced, consolidated or otherwise altered in a manner which is not supportive of ongoing commercial use of RECELL.

Our current and future relationships with regulators, HCPs, third-party payors, customers, and consultants will be subject to applicable healthcare laws and regulations, as well as to other laws and regulations addressing fraud and abuse, and failure to comply with such laws could expose us to penalties.

Our business operations, as well as our current and future relationships with regulators, healthcare professionals, third-party payors, customers, and consultants may expose us to healthcare laws and regulations, as well as to other laws and regulations addressing fraud and abuse. These laws regulate our business as well as the financial arrangements and relationships through which we conduct our operations, including how we research, market, sell, and distribute our products for which we obtain marketing approval. Such laws include:

There is no assurance that we will be completely effective in ensuring our compliance with all applicable laws. If we are not in compliance with these laws, we may be subject to civil and/or criminal and penalties, disgorgement, and other sanctions and remedial measures, and legal expenses, which could have an adverse impact on our business, financial condition, results of operations, and liquidity. Likewise, any investigation of potential violations of these laws by respective government bodies could also have an adverse impact on our reputation, as well as on our business, financial condition, and results of operations.

Defending against any allegations that we have violated any such laws can be costly, time-consuming and may require significant financial and personnel resources. Therefore, even if we are successful in defending against any such allegations that may be brought against us, our financial condition and operations, as well as business prospects, may be impaired.

Macroeconomic and Social Risks

Adverse changes in general economic conditions or uncertainty about future economic conditions, could adversely affect us.

We are subject to the risks arising from adverse changes in general economic market conditions. Uncertainty about future economic conditions could negatively affect our current and prospective customers causing them to delay the purchase of our products. Customer and consumer demand for our products may be impacted by weak economic conditions, recession, equity market volatility or other negative economic factors in the U.S. or other nations. The severity and length of time that a downturn in economic and financial market conditions may persist, as well as the timing, strength, and sustainability of any recovery from such downturn, are unknown and beyond our control. Poor economic conditions could harm our business, financial condition, operating results, and cash flows.

Risks Relating to Our Common Stock and CDIs

We have never paid a dividend on our common stock and CDIs and do not intend to do so in the foreseeable future, and consequently, investors’ only opportunity to realize a return on their investment in the Company is through the appreciation in the price of our common stock and CDIs.

We do not anticipate paying cash dividends on our common stock and CDIs in the foreseeable future and intend to retain all earnings, if any, to fund our operations. Even if funds are legally available for distribution, we may be unable to pay any dividends to our stockholders because of limitations imposed by a lack of liquidity. Accordingly, our stockholders may have to sell some or all of their common stock or CDIs (as applicable) in order to generate cash flow from their investment. Our stockholders may not receive a gain on their investment when they sell their common stock or CDIs and may lose some or all of their investment. Any determination to pay dividends in the future on our common stock and CDIs will be made at the discretion of our board of directors (the “Board of Directors” or the “Board” and each director, a “Director”) and will depend on our results of operations, financial condition, contractual restrictions, restrictions imposed by applicable law, capital requirements, and other factors that our Board of Directors deems relevant.

As long as we remain subject to the rules of the Australian Securities Exchange (“ASX”) and of Nasdaq, we will be unable to access equity capital without stockholder approval if such equity capital sales would result in an equity issuance above regulatory thresholds, and consequently, we may be unable to obtain financing sufficient to sustain our business if we are unsuccessful in soliciting requisite stockholder approvals.

Our ability to access equity capital is currently limited by ASX Listing Rule 7.1, which provides that a company must not, subject to specified exceptions, issue or agree to issue during any consecutive 12-month period any equity securities, or other securities with rights to conversion to equity, if the number of those securities in aggregate would exceed 15% of the number of outstanding common shares at the commencement of that 12-month period unless stockholder approval is obtained.

Our equity issuances will be limited by ASX Listing Rule 7.1 so long as we continue to be listed on the ASX and this constraint may prevent us from raising the full amount of equity capital needed for operations without prior stockholder approval.

In addition to ASX Listing Rule 7.1, we are also subject to Nasdaq Listing Rule 5635(d), commonly referred to as the “Nasdaq 20% Rule”, which requires stockholder approval of a transaction other than a public offering involving the sale, issuance, or potential issuance by a company of common stock (or securities convertible into or exercisable for common stock) equal to 20% or more of the common stock, or 20% or more of the voting power outstanding before the issuance for less than the greater of book or market value of the shares. While less restrictive than ASX Listing Rule 7.1, the operation of the Nasdaq 20% Rule could limit our ability to raise capital through issuance of common stock or convertible securities without jeopardizing our listing status. If we were to violate the “Nasdaq 20% Rule”, the Company would be subject to delisting from Nasdaq and share prices and trading volumes would likely suffer.

There has been relatively limited trading volume in the markets for our common stock and CDIs, and more active, liquid trading markets for such securities may never develop.

Trading in our common stock on Nasdaq and our CDIs on the ASX is often thin and susceptible to wide fluctuations in trading prices due to such limited trading volume and other factors, some of which may have little to do with our operations or business prospects. Limited liquidity in the trading markets for our common stock and CDIs may adversely affect a stockholder’s ability to sell its shares of our common stock or CDIs at the time it wishes to sell them or at a price that it considers acceptable. In addition, if a more active, liquid public trading market does not develop we may be limited in our ability to raise capital by selling shares of common stock or CDIs. We cannot assure you that more active, liquid public trading markets for our common stock and CDIs will develop or, if developed, will be sustained.

The market price and trading volume of our common stock and CDIs may be volatile and may be affected by variability in our performance from period to period and economic conditions beyond management’s control.

The market price of our common stock (including common stock represented by CDIs) may be highly volatile and could be subject to wide fluctuations. This means that our stockholders could experience a decrease in the value of their common stock or CDIs regardless of our operating performance or prospects. The market prices of securities of companies operating in the medical device sectors have often experienced fluctuations that have been unrelated or disproportionate to their operating results. In addition, the trading volume of our common stock and CDIs may fluctuate and cause significant price variations to occur. If the market price of our common stock or CDIs declines significantly, our stockholders may be unable to resell our common stock or CDIs at or above their purchase price, if at all. There can be no assurance that the market price of our common stock and CDIs will not fluctuate or significantly decline in the future.

Some specific factors that could negatively affect the price of our common stock and CDIs or result in fluctuations in their price and trading volume include:

If research analysts publish unfavorable commentary or downgrade our common stock or CDIs, it could adversely affect our share price and trading volume.

The trading market for our common stock and CDIs depends, in part, on the research and reports that analysts publish about us and our business and industry. If one or more analysts downgrade our shares or CDIs, publish unfavorable commentary about the Company or cease publishing reports about us or our business, the price of our common stock and CDIs could decline. If one or more of the analysts ceases coverage of our company or fails to publish reports on us regularly, demand for our common stock and CDIs could decrease, which could cause our share price or trading volume to decline.

The requirements of being a public company in the United States and listed on the ASX may strain our resources and divert management’s attention.

As a public company, we are subject to the reporting requirements of the Exchange Act, the U.S. Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), the Dodd-Frank Act, and the listing standards and the rules and regulations of Nasdaq. We are also subject to the reporting requirements under the ASX Listing Rules due to the listing of our CDIs on ASX. The requirements of these rules and regulations will increase our legal, accounting, and financial compliance costs, make some activities more difficult, time- consuming and costly, and can place significant strain on our personnel, systems, and resources. As a result of our disclosure of information in filings required of a public company, our business and financial condition is more visible, which may result in threatened or actual litigation, including by competitors, stockholders or third parties. If such claims are successful, and even if the claims do not result in litigation or are resolved in our favor, these claims, and the time and resources necessary to resolve them, could divert the resources of our management and harm our business and operating results.

We are a “smaller reporting company”, under federal securities laws, and the reduced disclosure requirements applicable to such companies may make our common stock less attractive to investors.

We will remain a smaller reporting company so long as (i) our public float remains less than $250 million as of the last business day of our most recently completed second fiscal quarter or (ii) our annual revenues are less than $100 million during our most recently completed fiscal year; and we have no public float; or a public float of less than $700 million.

For as long as we continue to be a smaller reporting company, we may take advantage of exemptions from various reporting requirements that are applicable to other public companies, including (1) not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, and (2) reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements. In addition, we are only required to provide two years of audited financial statements in our SEC reports. We will remain a smaller reporting company so long as (i) our public float remains less than $250 million as of the last business day of our most recently completed second fiscal quarter or (ii) our annual revenues are less than $100 million during our most recently completed fiscal year; and we have no public float; or a public float of less than $700 million. We 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 decline or be more volatile.

General Risk Factors

The Company's cash, cash equivalents and marketable securities could be adversely affected by bank failures or other events affecting financial institutions and could adversely affect our liquidity and financial performance.

We regularly maintain domestic cash deposits in Federal Deposit Insurance Corporation (“FDIC”) insured banks, which exceed the FDIC insurance limits. We also maintain cash deposits in foreign banks where we operate, some of which are not insured or are only partially insured by the FDIC or other similar agencies. The failure or rumored failure of a bank, or events involving limited liquidity, defaults, non-performance, bankruptcy, receivership or other adverse developments in the financial or credit markets impacting financial institutions, may lead to disruptions in access to our bank deposits. These disruptions may adversely impact our liquidity and financial performance. There can be no assurance that our deposits in excess of the FDIC or other comparable insurance limits will be backstopped by the U.S. or applicable foreign government, or that any bank or financial institution with which we do business will be able to obtain needed liquidity from other banks, government institutions or by acquisition in the event of a failure or liquidity crisis. As such, those funds in bank deposit accounts in excess of the standard FDIC insurance limits are uninsured and subject to the risk of bank failure.

Currently, we have full access to all funds in deposit accounts or other money management arrangements. The failure of any bank in which we deposit our funds could reduce the amount of cash that we have available for our operations or delay our ability to access such funds. In the event of such failure, we may experience delays or other issues in meeting our financial obligations, our ability to access our cash and cash equivalents may be threatened and could have a material adverse effect on our business and financial condition.

Future adverse developments with respect to specific financial institutions or the broader financial services industry may also lead to market-wide liquidity shortages.

If we fail to manage our growth effectively, our business could be disrupted.

Our future financial performance and ability to successfully commercialize our products and to compete in the market will depend, in part, on our ability to manage any future growth effectively. We expect to make significant investments to facilitate our future growth through, among other things:

Any failure to manage future growth effectively could have a material adverse effect on our business and results of operations.

Our growth and success depend on our ability to attract and retain additional highly qualified and skilled sales and marketing, research and development, operational, managerial, legal, and finance personnel.

Competition for skilled personnel is intense and the unexpected loss of an employee with a particular skill could have a material adverse effect on our operations until a replacement can be found and trained. If we cannot attract and retain skilled scientific and operational personnel for our research and development and manufacturing operations on acceptable terms, we may not be able to develop and commercialize our products. Further, any failure to effectively onboard and train new personnel could prevent us from successfully growing our company.

Item 1B. UNRESOLVED STAFF COMMENTS

None

Item 2. PROPERTIES

Our principal corporate office is located at 28159 Avenue Stanford, Suite 220, Valencia, California 91355. We lease the 17,500 square foot facility under a lease agreement that expires on October 31, 2026. Our production plant in Ventura, California is a 27,840 square foot facility that we lease through September 30, 2030. We also lease a 3,360 square foot storage facility adjacent to our existing production plant in Ventura under a lease agreement that expires on September 30, 2030. The Company also has an administrative office lease in Irvine, California of approximately 10,700 square feet that is currently leased through the end of July 2028. We do not own any real property. We believe that leased facilities are adequate to meet current needs and that additional facilities will, if required, be available for lease to meet future needs.

Item 3. LEGAL PROCEEDINGS

We are currently not aware of any material pending legal proceedings to which we are a party or of which any of our property is the subject, nor are we aware of any such proceedings that are contemplated by any governmental authority. From time to time, as an operating business, we are involved in routine disputes (both formal and informal) with customers, partners and employees.

Item 4. MINE SAFETY DISCLOSURES

Not applicable.

PART II

Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information

The Company’s common stock is quoted on the Nasdaq Capital Market under the ticker symbol “RCEL” and the Company’s CDIs are quoted on the ASX under the ticker code “AVH”. One share of common stock on Nasdaq is equivalent to five CDIs on the ASX.

Holders

As of January 26, 2026, the Company had approximately 3 unique stockholders of record of our common stock (which includes 18,051 holders of record of the Company’s CDIs, with each representing 1/5 of a share of common stock, and CHESS Depositary Nominees Pty Ltd, holds the legal title to all of the outstanding common stock underlying the CDIs of the Company).

Dividends

We have never paid cash dividends to our stockholders or to the holders of ordinary shares in the former parent company, AVITA Australia. We intend to retain future earnings for use in our business and do not anticipate paying cash dividends on our common stock and CDIs in the foreseeable future. Any future dividend policy will be determined by our Board and will be based upon various factors, including our results of operations, financial condition, current and anticipated cash needs, future prospects, contractual restrictions and other factors as our Board may deem relevant.

Item 6. [Reserved]

Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS

Objective

The purpose of this Management’s Discussion and Analysis is to better allow our investors to understand and view our company from management's perspective. We are providing an overview of our business and strategy including a discussion of our financial condition and results of operations. The following discussion and analysis of our financial condition and results of operations for the years-ended December 31, 2025 and 2024, should be read in conjunction with our consolidated financial statements and related notes included in this Annual Report.

Overview

AVITA Medical, Inc. (“we”, “our”, “us”) is a leading therapeutic acute wound care company delivering transformative solutions. Our solutions improve the healing outcomes for patients with traumatic injuries and surgical repairs, addressing critical healing needs that arise from unpredictable and life-changing events. At the forefront of our portfolio is RECELL® (“RECELL”), approved by the U.S. Food & Drug Administration (the “FDA”) for the treatment of thermal burn wounds and full-thickness skin defects. RECELL harnesses the healing properties of a patient’s own skin to create an autologous skin cell suspension, Spray-On Skin™ Cells, offering an innovative solution for improved clinical outcomes at the point of care. In addition, in the United States, we hold the rights to manufacture and exclusively market, sell, and distribute PermeaDerm®, a biosynthetic wound matrix, under the terms of exclusive multi-year distribution and contract manufacturing agreements with Stedical Scientific, Inc. (“Stedical”). We also entered into an exclusive multi-year development and distribution agreement with Collagen Matrix, Inc. dba Regenity Biosciences (“Regenity”). Regenity manufactures and supplies Cohealyx™, an AVITA Medical-branded, FDA-cleared, collagen-based dermal matrix. Under the agreement with Regenity, we hold the exclusive rights to market, sell, and distribute Cohealyx in the U.S., with the potential to expand such commercialization into the European Union, Australia, and Japan.

The single-use RECELL Autologous Cell Harvesting Device (“RECELL Ease-of-Use” or “RECELL EOU”) is approved by the FDA for the treatment of thermal burn wounds and full-thickness skin defects. Our next-generation device, RECELL GO® Autologous Cell Harvesting Device (“RECELL GO”), is FDA-approved to treat thermal burn wounds and full-thickness skin defects. RECELL GO introduces enhanced features that improve consistency and standardization across clinical settings. It consists of two components: the RECELL GO Processing Device (the “RPD”) and the RECELL GO Preparation Kit (the “RPK”). The RPD is a multi-use, AC-powered device that controls the RPK. The RPK contains a single-use cartridge and the RECELL Enzyme™. The RPD regulates the pressure applied to disaggregate the cells and precisely controls the incubation time of the RECELL Enzyme to optimize cell yield and promote cell viability. RECELL GO mini™ Autologous Cell Harvesting Device (“RECELL GO mini”), which was approved by the FDA in December 2024, is a line extension of RECELL GO, designed specifically to treat smaller wounds up to 480 cm2. It utilizes the same RPD but features a RECELL GO mini Preparation Kit, which includes a single-use RECELL GO mini cartridge optimized for smaller skin samples. These modifications are intended to align with the needs of clinicians treating smaller wounds, and to support broader adoption of the RECELL GO platform in trauma centers.

We are executing a focused commercial strategy centered on approximately 200 U.S. burn and trauma centers that represent the highest value and procedural volume within the acute wound care market. These institutions are core to our commercialization efforts due to their high concentration of complex inpatient cases and consistent procedural throughput. By prioritizing burn and trauma centers, we are targeting the most critical segments of acute wound care to maximize clinical impact and drive adoption across our portfolio.

To further our mission of improving clinical outcomes and establishing new standards of acute wound care, we have outlined the following strategic objectives:

Business Environment and Current Trends

Changes in reimbursement rates and coverage policy by third party payors may place additional financial pressure on

hospitals and the broader healthcare system. These changes could reduce demand for our products, particularly if healthcare providers face lower margins or additional administrative burdens. For example, in 2025 the Centers for Medicare & Medicaid Services (“CMS”) designated pricing responsibility for the Current Procedural Terminology (“CPT”) code used with RECELL to the seven regional Medicare Administrative Contractors (“MACs”). MAC delay in establishing and publishing reimbursement rates temporarily slowed clinician use of RECELL. As of January 2026, all seven MACs have established pricing, six of which have been published, restoring reimbursement clarity and supporting a return toward normalized utilization.

The macroeconomic environment may have unexpected adverse effects on businesses and healthcare institutions globally that may negatively impact our consolidated operating results. There remains significant uncertainty in the current macroeconomic environment due to factors including supply chain shortages, increased cost of healthcare, changes to inflation rates, a competitive labor market, tariffs, and other related global economic conditions and geopolitical conditions. If these conditions continue or worsen, they could adversely impact our future operating results.

Geopolitical conditions may also impact our operations. Although we do not have operations in Russia, Ukraine, the Middle East, or Asia, the continuation or threat of military conflicts in these regions or any escalation of conflicts beyond their current scope may further weaken the global economy resulting in additional inflationary pressures or supply chain constraints.

Recent Developments

On January 13, 2026, we closed a five-year credit facility providing up to $60 million in capital with a new lender and refinanced our existing debt, receiving total net proceeds of $6.0 million after repayment of our existing debt and certain fees. As part of the new credit facility, we established trailing twelve-month (“TTM”) revenue covenants aligned with our current operating trajectory. The initial TTM revenue covenant is $68.5 million for the first quarter ending March 31, 2026, and $73 million for the full year 2026. For additional information, see Liquidity and Capital Resources below.

On January 5, 2026, the Board of Directors recognized the contributions of long-time Director (and former Chair of the Board) Lou Panaccio, whose last day of service was December 31, 2025. Following Mr. Panaccio’s retirement, the Board was pleased to announce Joe Woody’s appointment as a new Director pursuant to an offer letter to join the Board as of January 1, 2026.

On October 16, 2025, Mr. Vance, the Chair of the Board of Directors, assumed the position of Interim Chief Executive Officer (the “Interim CEO”) upon the departure of Mr. Corbett from the Company and the Board.

On October 1, 2025, the CMS approved a New Technology Add-On Payment (“NTAP”) for the RECELL® System, applicable to acute non-thermal full-thickness skin defects—such as traumatic injuries and surgical wounds—that require inpatient care and are treated with RECELL in combination with a meshed autograft. This NTAP designation allows Medicare Part A inpatient claims to receive up to $4,875 in additional reimbursement per case, beyond the standard MS-DRG base rate, provided CMS thresholds and coding criteria are met. The NTAP is effective from October 1, 2025, through September 30, 2026, and was granted under CMS’s alternative pathway recognizing RECELL’s FDA Breakthrough Device status, reinforcing its clinical value and supporting broader hospital adoption.

On September 14, 2025, we obtained the CE Mark for RECELL GO under the European Union Medical Device Regulation (“EU MDR”). This allows us to commercialize RECELL GO in Europe and other markets that recognize the CE Mark.

During 2025, we continued to expand the clinical and real-world evidence supporting RECELL and its acute wound care portfolio, with an emphasis on hospital utilization, wound closure outcomes and staged care pathways. Data presented at major burn and wound care conferences highlighted reproducible outcomes in clinical practice and increasing surgeon adoption across diverse patient populations.

Key studies presented during 2025 included the following:

Sources for the studies referenced above were provided in the relevant press releases we issued from June through November 2025.

In 2025, we initiated two post-market clinical trials, PermeaDerm I and Cohealyx I, to further evaluate the performance of our technologies in the treatment of acute and complex wounds. The PermeaDerm I study is designed to assess cost and clinical outcomes when used as a temporizing treatment, and enrollment in this study has surpassed 75%. The Cohealyx I study is intended to evaluate time to autografting compared to a literature derived performance goal, with enrollment completed we expect data in 2026.

In early 2026, presentations at the Boswick Burn & Wound Symposium extended this evidence to staged wound care strategies, including surgeon-reported cases integrating RECELL, PermeaDerm and Cohealyx on the same patient. Together, these data reflect growing use of AVITA Medical’s integrated portfolio across wound coverage, preparation and definitive closure.

Results of Operations

Year-Ended December 31, 2025, compared to the Year-Ended December 31, 2024

The table below summarizes the results of our operations for each of the periods presented (in thousands).

*nm = not meaningful

Total revenues increased by 11%, or $7.4 million, to $71.6 million, compared to $64.3 million in the year-ended December 31, 2024. The growth in revenues was largely driven by deeper penetration within customer accounts, new accounts for the treatment of traumatic and surgical wounds and, to a lesser extent, new product launches.

Gross profit margin was 82.1% compared to 85.8% in the corresponding period in the prior year. Note that the gross margin for RECELL products only was 84.3% for the year. The decrease in the overall gross margin percentage from the prior year was primarily caused by product mix and higher inventory reserve. We share the average sales price for Cohealyx at 50% and for PermeaDerm at 60%. Although these arrangements are highly beneficial, they inevitably result in an overall decrease in gross margin percentage. Therefore, the product mix is expected to continue to reduce the overall gross margin percentage while increasing the gross profit, and given that costs associated with this revenue do not increase significantly, operating profit increases on a quarterly basis.

Total operating expenses decreased by 9% or $10.4 million to $101.4 million, compared with $111.8 million in the year-ended December 31, 2024.

Sales and marketing expenses decreased by 9%, or $5.1 million, to $53.1 million, compared to $58.2 million in the year-ended December 31, 2024. Lower costs in the current year were related to decreases in salaries and benefits of $1.9 million, stock-based compensation expense of $0.9 million, commissions expense of $0.7 million, professional fees of $0.7 million, recruiting expenses of $0.6 million, and travel expenses of $0.3 million. The decreases are primarily due to the reduction of our sales force as part of cost savings initiatives.

General and administrative expenses decreased by 18%, or $5.8 million, to $27.3 million, compared to $33.1 million in the year-ended December 31, 2024. Lower costs in the current year are due to decreases in stock-based compensation of $3.5 million and salaries and benefits of $2.3 million. The decreases in salaries and benefits and stock-based compensation are primarily attributable to decreased headcount.

Research and development expenses increased by 2%, or $0.5 million, to $20.8 million, compared to $20.3 million in the year-ended December 31, 2024. Higher costs in the current year are due to increases in salaries and benefits of $1.0 million and stock-based compensation expense of $0.7 million, offset by decreases in research and development expenses of $0.8 million and lower other research and development expenses of $0.4 million. The decrease in research and development expenses are due to the capitalization of project costs, specifically internally developed software.

Other (expense) income, net decreased by $1.2 million to other expense, net of $1.0 million. In the current year, other expense, net consists of $3.3 million in debt issuance costs and $1.4 million related to the change in fair value of loan facility, offset by a non-cash gain of $2.2 million related to the change in fair value of warrants, $0.9 million in income related to our investments, and $0.4 million in other gains, net. In the prior period, other income, net of $0.2 million consisted of $2.7 million in income related to our investments and $0.3 million in other gains, net offset by non-cash charges of $2.5 million due to the change in fair value of the debt and $0.3 million due to the change in fair value of warrant liability.

Net loss decreased by $13.3 million, to $48.6 million, over the $61.8 million recognized in the year ended December 31, 2024. The decrease in net loss was driven by the higher gross profit and lower operating expenses offset by higher other expense, net as described above.

Year-Ended December 31, 2024, compared to the Year-Ended December 31, 2023

The table below summarizes the results of our operations for each of the periods presented (in thousands).

*nm = not meaningful

Total revenues increased by 28%, or $14.1 million, to $64.3 million, compared to $50.1 million in the year-ended December 31, 2023. Our commercial revenue was $64.0 million for the year-ended December 31, 2024, an increase of $14.2 million, or 29%, compared to $49.8 million in the year-ended December 31, 2023. The growth in commercial revenues was largely driven by deeper penetration within customer accounts and new accounts for full-thickness skin defects.

Gross profit margin was 85.8% compared to 84.5% in the corresponding period in the prior year. This increase was largely driven by increases in both revenues and the volume of production.

BARDA income decreased to zero, compared to $1.4 million in the corresponding period in the prior year due to the ending of reimbursable clinical trials. BARDA income in the prior year consisted of funding received from the Biomedical Advanced Research and Development Authority, under the Assistant Secretary for Preparedness and Response, within the U.S. Department of Health and Human Services, under ongoing USG Contract No. HHSO100201500028C.

Total operating expenses increased by 29% or $25.3 million to $111.8 million, compared with $86.4 million in the year-ended December 31, 2023.

Sales and marketing expenses increased by 56%, or $20.9 million, to $58.2 million, compared to $37.3 million in the year-ended December 31, 2023. Higher costs in the current year were related to increases in salaries and benefits and personnel expenses of approximately $8.7 million, commissions expense of $7.4 million, stock-based compensation expense of $1.8 million, $1.2 million in professional fees, $0.6 million in other selling expenses, $0.6 million in travel expenses, and $0.2 million in rent expense, plus $0.4 million in all other expenses, net. The increase in salaries and benefits, personnel-related expenses, stock-based compensation, travel expenses, and other selling expenses are due to the expansion of the sales force to support our growing commercial capabilities. Higher commissions were directly associated with the increase in revenues. The increase in professional fees are primarily due to consulting expenses related to our foreign distribution network. The increase in rent is due to increased office space to accommodate our growing operations.

General and administrative expenses increased by 17%, or $4.9 million, to $33.1 million, compared to $28.3 million in the year-ended December 31, 2023. The increase was attributable to increases in salaries and benefits and personnel expenses of $2.9 million, stock-based compensation of $2.4 million, and rent expense of $0.5 million, partially offset by lower deferred compensation expenses of $0.4 million, lower insurance expense of $0.3 million plus lower other corporate expenses, net of $0.3 million. The increase in salaries and benefits and stock-based compensation are primarily attributable to headcount growth to support the expansion of our business. The decrease in the deferred compensation expense is driven by a lower stock price used to calculate the deferred compensation liability for the deferred restricted stock awards.

Research and development expenses decreased by 2%, or $0.5 million, to $20.3 million, compared to $20.8 million in the year-ended December 31, 2023. The decrease in research and development expenses is primarily due to lower professional fees and development expenses of approximately $4.0 million related to RECELL GO and full-thickness skin defects plus lower other development expenses, net of $0.3 million, partially offset by an increase in salaries and benefits of $2.8 million, an increase in stock-based compensation of $0.7 million, and an increase of $0.3 million in travel expenses, primarily due to the increase in headcount resulting from the deployment of Medical Science Liaisons.

Interest expense increased approximately $4.2 million in comparison to the prior year due to the interest expense related to long-term debt for the full year, for an aggregate principal amount owed of $40 million.

Other income, net decreased by $8.3 million to $0.2 million. In the current year, other income, net consisted of $2.7 million in income related to our investments and $0.3 million in other gains, net offset by non-cash charges of $2.5 million due to the change in fair value of the debt and $0.3 million due to the change in fair value of warrant liability. In the prior period, income consisted of $3.1 million in income from our investment activities, dissolution of certain foreign subsidiaries that resulted in a $9.4 million gain, plus other gains, net of $0.3 million, partially offset by a loss on debt issuance of $1.2 million, debt issuance costs of $0.8 million and the change of fair value for our debt of $1.6 million and change in fair value of warrants for $0.7 million.

Net loss increased by $26.5 million, to $61.8 million, over the $35.4 million recognized in the year ended December 31, 2023. The increase in net loss was driven by the higher operating expenses and lower other income, net, partially offset by higher gross profit as described above.

Liquidity and Capital Resources

Overview

Our Consolidated Financial Statements have been prepared on the basis we will continue as a going concern for the next 12 months. We had approximately $10.2 million in cash and cash equivalents and $7.9 million in marketable securities as of December 31, 2025. We have funded our research and development activities, and more recently our substantial investment in sales and marketing activities, through the sale of our products, the issuance of equity securities, and debt financing. If capital is not available to us when amounts are needed, we could be required to delay, scale back or abandon commercial and development programs and other operations, which could adversely impact our business, financial condition, and operating results.

Based on our liquidity position and current forecast of operating results and cash flows, management determined there is substantial doubt about our ability to continue as a going concern over the next twelve months following the date of issuance of these Consolidated Financial Statements due to our debt repayment obligations, historical negative cash flows, and recurring losses. As a result, we may require additional liquidity to continue our operations over the next twelve months.

Subsequent to December 31, 2025, on January 13, 2026 (the “Closing Date”), we entered into a Credit Agreement and Guaranty (the “Perceptive Credit Agreement”), and Security Agreement (the “Security Agreement”), by and among us, as borrower, Avita Medical Americas, LLC, a wholly-owned subsidiary of the Company, as guarantor (the “Guarantor,” taken together with the Company, the “Obligors”) and Perceptive Credit Holdings V, LP as a lender and the administrative agent (the “Lender,” and the “Administrative Agent,” as applicable). The Perceptive Credit Agreement provides for a five-year senior secured credit facility in an aggregate principal amount of up to $60 million (the “Perceptive Loan Facility”), of which (i) $50 million was funded on the Closing Date (the “ Perceptive Initial Commitment Amount”) and (ii) $10 million will be made available, at our discretion by notice to the Administrative Agent on or before March 31, 2027, subject to satisfaction of a certain net revenue requirement (the “Additional Commitment Amount”). On the Closing Date, we closed on the Perceptive Initial Commitment Amount, less certain fees and expenses payable to or on behalf of the Lender. Simultaneously with the closing of the Perceptive Initial Commitment Amount, we repaid in full and terminated all of its obligations and commitments (the “Refinancing Transaction”) under the Previous Credit Agreement (as defined below).

During the term of the Perceptive Loan Facility, interest payable in cash shall accrue on any outstanding amounts under the Loan Facility at a rate per annum equal to the greater of (x) the SOFR rate for such period and (y) 4.00% plus, in either case, 7.50%. Upon the occurrence and during the continuance of an event of default, any outstanding amount under the Perceptive Loan Facility will bear interest at a rate of 4.00% in excess of the otherwise applicable rate of interest.

Under the terms of the Perceptive Credit Agreement, and as set forth in a fee letter between us, and the Lender and the Administrative Agent (the “Fee Letter”), we will pay certain fees with respect to the Loan Facility, including (a) an exit fee equal to 5% of the aggregate principal amount borrowed by us under the Perceptive Credit Agreement in the event that we fail to secure shareholder approval of the issuance of the Warrant (as defined below) in accordance with the rules of the ASX (the “Warrant Shareholder Approval”) on or prior to September 30, 2026, and (b) a prepayment premium ranging from 1% to 10% of the amount of the Loan Facility that is prepaid upon any voluntary or mandatory prepayment (including as a result of an acceleration), together with certain other fees and expenses of the Lender.

The Perceptive Credit Agreement contains certain customary events of default, including with respect to nonpayment of principal, interest, fees or other amounts; material inaccuracy of a representation or warranty; failure to perform or observe covenants; material defaults on other indebtedness; insolvency; loss of certain key permits, persons and contracts; material adverse effects; certain regulatory matters; and change of control. Additionally, the Company’s failure to obtain the Warrant Shareholder Approval on or prior to November 30, 2026 shall constitute an event of default under the Perceptive Credit Agreement.

The Perceptive Credit Agreement contains a number of customary representations, warranties and covenants that, among other things, will limit or restrict the ability of the Company and its subsidiaries to (subject to certain qualifications and exceptions): create liens and encumbrances; incur additional indebtedness; merge, dissolve, liquidate or consolidate; make acquisitions, investments, advances or loans; dispose of or transfer assets; pay dividends or make other payments in respect of their capital stock; redeem or repurchase certain debt; engage in certain transactions with affiliates; and enter into certain restrictive agreements. Among such covenants, the Perceptive Credit Agreement includes a financial maintenance test that requires the Obligors to maintain a specified minimum net revenue for each trailing twelve-month period ending on the last day of a fiscal quarter occurring prior to the maturity date of the Loan Facility. In addition, the Perceptive Credit Agreement requires the Company to ensure that the Obligors maintain in the aggregate at least $5 million of unrestricted cash at all times.

Pursuant to the Security Agreement, all obligations under the Perceptive Credit Agreement is guaranteed by the Guarantor and secured by substantially all of our and the Guarantor’s assets.

On August 12, 2025, we completed a private placement (the “Placement”) on the ASX to institutional and professional investors to raise $14.8 million, or $13.8 million after deducting sales commissions and offering expenses, through the issuance of 17,201,886 CHESS Depositary Interests (“CDIs”), which is the equivalent of 3,440,377 shares of Common stock. Proceeds of the Placement will be used for working capital requirements and will provide additional strategic flexibility to support continued growth of our therapeutic acute wound portfolio.

In connection with the Refinancing Transaction, on January 13, 2026, we repaid all outstanding indebtedness under the Previous Credit Agreement and terminated all obligations and commitments thereunder. As a result, we and the guarantors under the Previous Credit Agreement have no further obligations under the Previous Credit Agreement or the related guarantees other than with respect to warrants previously issued under the Previous Credit Agreement, which remain outstanding.

On September 30, 2025, we received a waiver related to the trailing 12-month revenue covenant for the third quarter of 2025. On November 5, 2025, we entered into a sixth amendment to the Previous Credit Agreement (the “Sixth Amendment”), which amended the trailing 12-month revenue covenant for the fourth quarter of 2025 to $70.0 million for the quarter ending December 31, 2025, and waived the event of default caused by the “going concern” qualification in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2025. The revenue covenants for all subsequent quarters remained in effect. In consideration for the Sixth Amendment, we agreed to add $500,000 to the original $40.0 million principal balance, with interest paid on this amount as of November 1, 2025 and during the term of the Previous Credit Agreement and payable along with the original $40.0 million principal balance, either at the maturity date or when and if earlier repaid.

On June 30, 2025, we received a waiver related to the trailing 12-month revenue covenant for the second quarter of 2025. On August 7, 2025, we entered into a fifth amendment to the Previous Credit Agreement (the “Fifth Amendment”), which further amended the trailing 12-month revenue covenants, and waived the event of default caused by the “going concern” qualification in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2025. In consideration of the Fifth Amendment, we issued 400,000 shares of our Common stock to the Lender.

On February 13, 2025, we entered into a fourth amendment to the Previous Credit Agreement (the “Fourth Amendment”), which amended the trailing 12-month revenue covenants. In consideration of the Fourth Amendment, we issued to the Lender warrants to purchase up to 145,180 shares of our common stock, at an exercise price of $0.01 per share, with a term of 10 years from the issuance date. On March 31, 2025, we received a waiver related to the trailing 12-month revenue covenant for the first quarter of 2025.

On October 18, 2023, we entered into a credit agreement (as amended and modified, the “Previous Credit Agreement”), by and between us, as borrower, and an affiliate of OrbiMed Advisors, LLC, as the lender and administrative agent. The Previous Credit Agreement provided for a five-year senior secured credit facility in an aggregate principal amount of up to $90.0 million, of which $40.0 million was borrowed, less certain fees and expenses. On November 7, 2024, we entered into the third amendment (the “Third Amendment”) to the Previous Credit Agreement. Under the terms of the Third Amendment and subject to our payment of a consent fee to the Lender, we mutually agreed to (1) terminate two additional tranches of available debt in the aggregate amount of $50.0 million and (2) remove the trailing 12-month revenue covenant for the fourth quarter of 2024, which was set at $67.5 million. All revenue covenants for subsequent quarters remained in effect.

The following table summarizes our cash flows for the periods presented: