AXGN

MKT CAP $2BP/E —DIV YIELD —FCF YIELD 0.44%REV TTM $251.2M +23.6%NET INCOME −$33.5MNET CASH $46.2M52W 17.49 – 51.73SEC XBRL · TTM TO Invalid Date

How AXGN rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

Text kept

34%

of sentences unchanged

Added

196

new sentences

Dropped

595

sentences removed

Length

−14,999

words, now 18,710

New in FY2025

Risk Factors – Our operations must comply with FDA and other governmental requirements.
Research and Development We are committed to advancing the field of peripheral nerve repair and offer the most comprehensive portfolio of solutions for peripheral nerve injuries.
Our development efforts are focused on expanding the clinical evidence base for nerve repair surgical applications, introducing product line extensions of the Avance Products and Axoguard products, and innovating new technologies and products to address unmet needs in peripheral nerve repair.
In collaboration with leading academic institutions, we actively support the development and evaluation of novel approaches in peripheral nerve injury treatment.
For the fiscal year ended December 31, 2025, we invested approximately $32.9 million in research and development (“R&D”) activities.
Because the requirements of the biomaterials used in peripheral nerve repair can vary based on the severity and location of the damaged nerve, the size and function of the nerve, surgical technique, and patient preference, our peripheral nerve repair products compete against both autograft materials (nerve in the case of a bridging repair and vein or fat in the case of a nerve protection repair), and a limited number of off-the-shelf alternatives for repairing, protecting and nerve termination.
Our intellectual property (“IP”), and that of our partners, including patents, patents-pending, trade secrets, and unique, internal subject matter expertise, is believed to be an important barrier for our Avance Products and Axoguard products.
Risk Factors – Technological change and competition for newly developed products could reduce demand for our products. and Risk Factors – Our operating results could be adversely impacted if we are unable to effectively manage and sustain our future growth or scale our operations.
Patents As of December 31, 2025, we own 45 issued U.S. patents, more than 50 pending U.S. patent applications (including those for which we have received a notice of allowance) and more than 500 international patents and patent applications with regard to our peripheral nerve products and other related technologies.
In connection with Avance, per Section 351(k)(7) and 351(i)(4) of the PHS Act, from the date of BLA approval, we believe we will have a period of 12 years of exclusivity in the U.S. from commercial competition from biosimilars using Avance Nerve Graft as the reference product.
Our Axoguard HA+ Nerve Protector is also the subject of multiple pending Axogen patent applications in the U.S. and abroad.
The potential for products competitive with Axogen’s Axoguard line of products, including our Axoguard Nerve Connector and Axoguard Nerve Protector, is further encumbered by the additional IP protections related to their methods of manufacture, as discussed further below in the Trademarks, Trade Secrets and Copyrights section below.
We have sought, and will continue to seek, patent Axogen, Inc. protection for select proprietary technologies and other inventions emanating from our R&D, including with respect to uses, methods, and compositions, in an effort to further fortify our IP in areas of importance to us and our growing product portfolio.
Additionally, we entered into the Distribution Agreement and Amended Supply Agreement with Evergen for the Axoguard products.
In addition, our Avance Products must comply with the standards of the tissue bank industry’s accrediting organization, the AATB.
We are the specification developer and authorization holder of the Axoguard HA+ Nerve Protector product, which is classified by the FDA as a Class II device.
Axoguard HA+ Nerve Protector was cleared for market under 510(k) K223640 on April 7, 2023, and a second 510(k) K231708 regulatory clearance was obtained on October 12, 2023, expanding the indication for use of Axoguard HA+ Nerve Protector.
Avive+ Soft Tissue Matrix Regulation We launched Avive+ Soft Tissue Matrix in the second quarter of 2024 after engagement with the FDA through the Tissue Reference Group Rapid Inquiry Program, which resulted in feedback that the product appears to be regulated solely under Section 361 of the PHS Act and the regulations in 21 CFR Part 1271.
Investigational New Drug Application for Drugs and Biologics Federal law requires that a new drug be the subject of an approved marketing application and that a biological product be properly licensed before each is introduced or delivered for introduction into interstate commerce.
The following regulations apply to the IND application process: • 21 CFR Part 201 Drug Labeling • 21 CFR Part 312 Investigational New Drug Application • 21 CFR Part 314 IND and NDA Applications for FDA Approval to Market a New Drug (New Drug Approval) • 21 CFR Part 316 Orphan Drugs • 21 CFR Part 50 Protection of Human Subjects • 21 CFR Part 54 Financial Disclosure by Clinical Investigators • 21 CFR Part 56 Institutional Review Boards • 21 CFR Part 58 Good Lab Practice for Nonclinical Laboratory Studies Biological Product License Application Pathway The BLA is a request for permission to introduce, or deliver for introduction, a biological product into interstate commerce (21 CFR Part 601.2).
Satisfaction of FDA approval requirements for biologics typically takes several years and the actual time required may vary substantially based on the type, complexity, and novelty of the product.
The steps for obtaining FDA approval of a BLA to market a biological product in the U.S. include: • Completion of pre-clinical laboratory tests, animal studies, and formulation studies under the FDA’s GLP regulations; • Submission to the FDA of an IND for human clinical testing, which must become effective before human clinical trials may begin and which must include independent IRB approval at each clinical site before the trials may be initiated; Axogen, Inc. • Performance of an adequate and well-controlled clinical trial in accordance with Good Clinical Practices to establish the safety and efficacy of the product for each indication; • Submission to the FDA of a BLA, which contains detailed information about the CMC for the product, reports of the outcomes and full data sets from the clinical trials, and proposed labeling and packaging for the product.
In March of 2021, FDA provided written responses to a Type B Meeting Request that documented a transition plan for after BLA approval.
Part of that transition plan included FDA agreement that Avance could be distributed as a tissue product following BLA approval until the depletion of Avance tissue product inventory and transition to distribution of Avance biologic product.
Axogen submitted the BLA for Avance on September 5, 2024.
The FDA held the Mid-Cycle meeting with Axogen on March 7, 2025 and the Late-Cycle Meeting on May 21, 2025.
In April 2025, FDA performed a Pre-License Inspection (“PLI”) of the Avance Processing Center in Vandalia, Ohio in support of the Avance BLA regulatory submission.
The manufacturing facility is now FDA registered and listed on the FDA Drug Establishment Registration site, and the PLI concluded with a positive outcome.
In December 2025, we received FDA approval of our BLA for Avance.
The indications for sensory nerve discontinuities >25mm and for mixed and motor nerve discontinuities were approved under FDA’s Accelerated Approval pathway based on the effect on static two-point discrimination in sensory nerve gaps ≤25mm, which provided empirical evidence to reasonably predict clinical benefit given similarities in pathophysiology and anticipated therapeutic effects.
Commercial availability of the licensed Avance product is expected early in the second quarter of 2026.
In the meantime, Avance remains available under the current tissue framework.
As part of the FDA approval of Avance under the BLA, Axogen has agreed to a Post-Marketing Requirement (“PMR”).
Under this PMR, Axogen will conduct a study comparing Avance to nerve autograft.
Axogen will submit the final study protocol by February 5, 2026, complete the trial by December 5, 2030 and submit the final study report within six months of completion, as well as reports every 180 days, beginning May 31, 2026.
Clinical trials for biological products require the submission and FDA acceptance of an IND and clinical trials for medical devices require the submission and FDA approval of an Investigational Device Exemption (“IDE”) application unless the device regulations provide for an exemption from the IDE requirement.
In our case, we believe that the Phase III clinical trial study for Avance Nerve Graft represents the only prospective clinical data that will be required to evaluate safety and effectiveness.
Phase III clinical trials usually further evaluate clinical efficacy and test further for safety in an expanded patient population.
Phase III clinical trials usually involve comparison with placebo, standard treatments, or other comparators.
Usually, multiple well-controlled large Phase III or pivotal clinical trials demonstrating safety and efficacy are required to support a BLA.

and 156 more.

Gone since FY2024

Risk Factors – Our operations must comply with FDA and other governmental requirements." Research and Development We are committed to advancing the field of peripheral nerve repair and providing the most comprehensive portfolio of solutions for peripheral nerve injuries.
Our development efforts are focused on expanding the clinical evidence base for nerve repair surgical applications, introducing product line extensions of the Avance and Axoguard products, and innovating new technologies and products to address unmet needs in peripheral nerve repair.
In collaboration with leading academic institutions, we actively support the development of novel treatment approaches for peripheral nerve injuries.
Our research initiatives are supported by several government-funded grants that explore the application of our technologies in nerve repair and recovery.
For the fiscal year ended December 31, 2024, we invested approximatel y $27.8 million in research and development activities.
P16 Table of Conten t Because the requirements of the biomaterials used in peripheral nerve repair can vary based on the severity and location of the damaged nerve, the size and function of the nerve, surgical technique, and patient preference, our peripheral nerve repair products compete against both autograft materials (nerve in the case of a bridging repair and vein or fat in the case of a nerve protection repair), and a limited number of off-the-shelf alternatives for repairing and protecting.
Our intellectual property (“IP”), and that of our partners, including patents, patents-pending, trade secrets, and unique, internal subject matter expertise, is believed to be an important barrier for our Avance Nerve Graft and Axoguard products.
Risk Factors – Technological change and competition for newly developed products could reduce demand for our products”; “Risk Factors –– Our operating results could be adversely impacted if we are unable to effectively manage and sustain our future growth or scale our operations”).
Patents As of the date of this Annual Report on Form 10-K, we own thirty-two issued U.S. patents, more than fifty pending U.S. patent applications (including those for which we have received a notice of allowance) and three hundred twenty international patents and patent applications with regard to our peripheral nerve products and other related technologies.
In connection with our Avance Nerve Graft, per Section 351(k)(7) and 351(i)(4) of the PHS Act, from the date of BLA approval, we believe we will have a period of 12 years of exclusivity in the U.S. from commercial competition from biosimilars using Avance Nerve Graft as t he reference product.
P17 Table of Conten t Our HA+ is also the subject of multiple pending Axogen patent applications in the U.S. and abroad.
The potential for products competitive with Axogen’s Axoguard line of products, including our Axoguard Nerve Connector and Axoguard Nerve Protector, is further encumbered by the additional IP protections related to their methods of manufacture, as discussed further below in the Trade Secrets section.
We have sought, and will continue to seek, patent protection for select proprietary technologies and other inventions emanating from our research and development ("R&D"), including with respect to uses, methods, and compositions, in an effort to further fortify our IP in areas of importance to us and our growing product portfolio.
Additionally, we entered into the Distribution Agreement and Supply Agreement with Evergen for the Axoguard products.
In addition, our Avance Nerve Graft must comply with the standards of the tissue bank industry’s accrediting organization, the AATB.
We are the specification developer and authorization holder of the HA+ product, which is classified by the FDA as a Class II device.
HA+ was cleared for market under 510(k) K223640 on April 7, 2023, and a second 510(k) K231708 regulatory clearance was obtained on October 12, 2023, expanding the indication for use of HA+.
P18 Table of Conten t Avive+ Soft Tissue Matrix Regulation We launched Avive+ Soft Tissue Matrix in the second quarter of 2024 after engagement with the FDA through the Tissue Reference Group Rapid Inquiry Program, which resulted in feedback that the product appears to be regulated solely under section 361 of the PHS Act and the regulations in 21 CFR Part 1271.
P19 Table of Conten t Investigational New Drug Application for Drugs and Biologics Federal law requires that a new drug be the subject of an approved marketing application and that a biological product be properly licensed before each is introduced or delivered for introduction into interstate commerce.
The following regulations apply to the IND application process: • 21 CFR Part 201 Drug Labeling • 21 CFR Part 312 Investigational New Drug Application • 21 CFR Part 314 IND and NDA Applications for FDA Approval to Market a New Drug (New Drug Approval) • 21 CFR Part 316 Orphan Drugs • 21 CFR Part 50 Protection of Human Subjects • 21 CFR Part 54 Financial Disclosure by Clinical Investigators • 21 CFR Part 56 Institutional Review Boards • 21 CFR Part 58 Good Lab Practice for Nonclinical Laboratory Studies Biological Product License Application Pa thway Th e BLA is a request for permission to introduce, or deliver for introduction, a biological product into interstate commerce (21 CFR Part 601.2).
Satisfaction of FDA approval requirements for biologics typically takes several years and the actual time P20 Table of Conten t required may vary substantially based on the type, complexity, and novelty of the product.
The steps for obtaining FDA approval of a BLA to market a biological product in the U.S. include: • Completion of pre-clinical laboratory tests, animal studies, and formulation studies under the FDA’s good laboratory practices regulations; • Submission to the FDA of an IND for human clinical testing, which must become effective before human clinical trials may begin and which must include independent IRB approval at each clinical site before the trials may be initiated; • Performance of an adequate and well-controlled clinical trial in accordance with Good Clinical Practices to establish the safety and efficacy of the product for each indication; • Submission to the FDA of a BLA, which contains detailed information about the CMC for the product, reports of the outcomes and full data sets from the clinical trials, and proposed labeling and packaging for the product.
If final action on the BLA is negative or we are found to not meet the conditions for the transition plan or its execution, or if FDA were to revoke the enforcement discretion for any other reason, we may not be able to continue to distribute Avance Nerve Graft.
We continue to work diligently to execute the transition plan, including maintaining regular communication with the FDA, and, in this context, continue to distribute Avance Nerve Graft.
We met with the FDA Center for Biologics Evaluation and Research ("CBER") in July 2010 and, between July 2010 and November 2010, provided information to CBER that resulted in the FDA issuing a letter stating the agency’s intent to exercise enforcement discretion with respect to the continued introduction or delivery for introduction into interstate commerce of Avance Nerve Graft assuming that certain conditions are met relating to the transition of Avance Nerve Graft from regulation as an HCT/P under Section 361 to a biological product under Section 351 of the PHS Act.
Specifically, the FDA transition plan outlined that: • We transition to compliance with Section 501(a)(2)(B) of the FD&C Act, the current cGMP regulations in 21 CFR Parts 210 and 211 and the applicable regulations and standards in 21 CFR Parts 600-610 prior to initiation of a phase 3 clinical trial designed to demonstrate the safety, purity, and potency of Avance Nerve Graft. ◦ We have performed several gap analyses of our quality system for compliance with 21 CFR Parts 210 and 211 and 600-610 regulations.
The gap analyses have identified areas in which our quality system could improve with respect to compliance with the regulations.
We have created and implemented appropriate changes, including new quality procedures.
Through our internal auditing process, we have assessed our compliance to the regulations.
We have also retained an external former FDA consultant with experience in P21 Table of Conten t auditing to 21 CFR Parts 210 and 211 and 600-610 regulations to verify quality system compliance with the regulations. • We conduct a phase 3 clinical trial to demonstrate safety, purity and potency of Avance Nerve Graft under a Special Protocol Assessment (“SPA”).
We and the FDA agreed to the SPA in August 2011. ◦ In accordance with FDA regulations in 21 CFR Part 312, we submitted IND #15419 to the FDA, and it became effective in March 2015. ◦ The phase 3 clinical trial was initiated in the second quarter of 2015.
The study completed initial enrollment in January 2019.
As required by the SPA and agreed to by FDA and us, an independent statistical analysis was conducted to determine if greater study enrollment was appropriate to maintain the planned statistical power of the trial.
As part of that review, the targeted enrollment was increased to 220 subjects, and the number of participating centers was increased to up to 25.
RECON results demonstrated statistical superiority for return of sensory function, as measured by static two-point discrimination, as compared to conduits in gaps greater than 12 mm (p-value <0.05).
Avance demonstrated statistical superiority for time to recover of static two-point discrimination over conduits in nerve gaps greater than 10mm (p-value <0.05). • We continue to comply with the regulations and standards under 21 CFR Part 1271. ◦ We were audited by the FDA at the Solvita facility in March 2013, March 2015, October 2016 and September 2022 and at the Avance distribution facility in October 2015 with respect to its Human Tissue Quality System under 21 CFR Part 1271 and in July 2022 with respect to Level 1 Quality System Inspection Technique Medical Device Inspection under 21 CFR Part 820.
At each inspection, the quality systems were found to be in compliance with 21 CFR Part 1271, and no FDA Form 483 observations were issued. ◦ In February 2018, we were audited by the FDA with respect to its Medical Device Quality System under 21 CFR Part 820 and its Human Tissue Quality System under 21 CFR Part 1271.
Such audit resulted in two Form 483 observations on general procedures on our Medical Device Quality System and no Form 483 observations on our Human Tissue Quality System.
We took corrective action to correct these observations, and the FDA accepted the corrective action plan. ◦ In November 2018, we were inspected by the FDA at our Texas distribution facility with respect to our Human Tissue Quality System under 21 CFR Part 1271.
Such inspection resulted in one Form 483 observation on tissue tracking.

and 555 more.

Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

Watch AXGN. Know when insiders buy.

One email the day a filing lands. Free.