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New words:
accredited, attack, attained, backstopped, BV, CA, CAGR, chest, Chinese, cloud, concealing, constrain, covert, cybersecurity, declassified, declassify, defense, Dissector, downsizing, drafted, EMEA, entry, epidemic, exploit, Fairfield, falsifying, fear, forensic, foster, grand, hematoma, impersonation, impossible, installation, intervention, Irving, learning, lengthen, militant, obfuscate, offensive, pain, Palestinian, persistence, pf, phishing, procure, ransomware, receivership, recessionary, Recoupment, reinterpreted, remittance, representation, retrieval, sabotage, seamlessly, sequestration, showcase, Signature, Silvergate, slowdown, spent, sublease, subleasing, swept, tenant, terminology, territoriality, terrorist, Tesla, tighter, trailing, Turkey, underreporting, underwritten, undetected, unintentional, unscheduled, upheaval, Valley, waived, wide, willingly, Zen, Zensor
Removed:
accessory, approximate, aspect, attempted, balanced, behavior, Biden, Binomial, Bipartisan, bond, Brexit, BSI, BVBA, Certificate, Circuit, Colleran, comfortable, compound, contouring, corroborated, defer, directing, distancing, dormant, dropped, easing, electrical, evolve, existed, FIN, FSC, heightened, hierarchy, home, house, input, inside, instrument, Jumpstart, Justice, Lattice, lay, legislate, lifting, magnitude, membership, observable, occurring, optionality, orderly, predictable, President, Puregraft, quoted, rating, reach, reached, recovered, recurring, redemption, reinfection, renegotiate, reopen, rescinding, resultant, resume, resumption, revising, show, simulation, staffing, submitting, suffering, supplemented, Supreme, suspending, telecommunication, traditional, trained, Trump, typical, unadjusted, unobservable, variability, veterinary, withheld
Financial report summary
?Risks
- Risks Related to the Development and Commercialization of Our Products
- We have a limited operating history in the United States and may face difficulties encountered by companies early in their commercialization in competitive and rapidly evolving markets.
- Our success depends, in part, on our ability to continue to enhance our existing products and services and develop or commercialize new products and services that respond to customer needs and preferences, which we expect will require us to incur significant expenses.
- The clinical trial process is lengthy and expensive with uncertain outcomes, and often requires the enrollment of large numbers of patients, and suitable patients may be difficult to identify and recruit. In addition, safety issues or other challenges may arise during the conduct of a trial. Delays or failures in our clinical trials will prevent us from commercializing any modified or new products and will adversely affect our business, operating results and prospects.
- Changes in funding or disruptions at the FDA and other government agencies caused by funding shortages or global health concerns could hinder their ability to hire and retain key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved or commercialized in a timely manner or at all, or otherwise prevent those agencies from performing normal business functions on which the operation of our business may rely, which could negatively impact our business.
- Any future distribution or commercialization agreements we may enter into with respect to our current or planned products may place the development of these products outside our control, or may otherwise be on terms unfavorable to us.
- If we are unable to educate clinicians on the safe, effective and appropriate use of our products and designed surgeries, we may experience unsatisfactory patient outcomes, negative publicity and increased claims of product liability and may be unable to achieve our expected growth.
- Commercial success of Motiva Implants in the United States or elsewhere depends on our ability to accurately forecast customer demand and manufacture sufficient quantities of product in the implant sizes that patients and physicians request, and to manage inventory effectively and the failure to do so could have a material adverse effect on our business, financial condition, results of operations and growth prospects.
- Risks Related to Our Business, Industry and Operations
- We expect to incur losses for the foreseeable future, and our ability to achieve and maintain profitability depends on the commercial success of our Motiva Implants.
- Unfavorable global economic conditions, including slower growth or recession, inflation or decreases in consumer spending power or confidence, could adversely affect our business, financial condition or results of operations.
- We have incurred net operating losses in the past and expect to incur net operating losses for the foreseeable future.
- If our available cash resources and anticipated cash flow from operations are insufficient to satisfy our liquidity requirements, we may seek to sell equity or convertible debt securities, enter into a credit facility or another form of third-party funding, or seek other debt financing.
- Our business depends on maintaining our brand and ongoing customer demand for our products and services, and a significant reduction in sentiment or demand could affect our results of operations.
- If we fail to compete effectively against our competitors, many of whom have greater resources than we have, our revenues and results of operations may be negatively affected.
- Pricing pressure from customers and our competitors may impact our ability to sell our products at prices necessary to support our current business strategies and future expansion.
- We expect to increase the size of our organization in certain jurisdictions and functions; as a result, we may encounter difficulties in managing our growth, which could disrupt our operations and/or increase our net losses.
- In certain large markets, we engage in direct sales efforts. We may fail to maintain and develop our direct sales force, and our revenues and financial outcomes could suffer as a result. Furthermore, our direct sales personnel may not effectively sell our products.
- We may be subject to substantial warranty or product liability claims or other litigation in the ordinary course of business that may adversely affect our business, financial condition and operating results.
- Counterfeit products may be represented as ours, which could compete with our genuine products and may also expose us to risks associated with adverse events and product liability.
- Negative publicity concerning our products or our competitors’ products, including due to product defects, recalls and any resulting litigation, could harm our reputation and reduce demand for silicone breast implants, either of which could adversely impact our financial results and/or share price.
- Recent news coverage has called into question the long-term safety of breast implants and reports of breast implant-associated anaplastic large cell lymphoma linked to our competitors’ products which have led to regulatory actions regarding macrotextured devices in several countries and the worldwide recall of one of our competitor’s macrotextured implants and tissue expanders. These events and reports of other forms of cancer, including squamous cell carcinoma and various lymphomas, from breast implant products may lead to a reduction in the demand for silicone breast implants and could adversely affect our business.
- The loss of members of our executive management team or other employees, or other turnover in our management team, could adversely affect our business.
- We have made multiple acquisitions in the past, and in the future we may acquire other businesses, form joint ventures or make investments in other companies or technologies. If we are not successful in integrating these businesses, as well as identifying and controlling risks associated with the past operations of these businesses, we may incur significant costs, receive penalties or other sanctions from various regulatory agencies and/or incur significant diversions of management time and attention.
- We have significant exposure to the economic and political situations in emerging market countries, and developments in these countries could materially impact our financial results, or our business more generally.
- Adverse developments affecting the financial services industry, such as actual events or concerns involving liquidity, defaults, or non-performance by financial institutions or transactional counterparties, could adversely affect our liquidity and financial performance.
- Our results of operations could be affected by fluctuations in currency rates.
- Continued international expansion of our business will expose us to business, regulatory, political, operational, financial and economic risks associated with doing business internationally.
- Any disruption at our existing facilities could adversely affect our business and operating results.
- Fluctuations in insurance costs and availability, and future insurance requirements could adversely affect our profitability or our risk management profile.
- Risks Related to Manufacturing and Other Third-Party Relationships
- Our operations involve hazardous materials and we and third parties with whom we contract must comply with environmental laws and regulations, which can be expensive and restrict how we do business, and could expose us to liability if our use of such hazardous materials causes injury.
- We rely on third parties to conduct certain components of our clinical studies, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such studies, which could interfere with or delay our ability to obtain regulatory approval or commercialize our products.
- We rely on a single-source, third-party supplier for medical-grade long-term implantable silicone, which is the primary raw material used in our Motiva Implants. If this supplier were to increase prices for this raw material over time or experience interruptions in its ability to supply us with this raw material, our business, financial condition and results of operations could be adversely affected.
- Various factors outside our direct control, including the reliance on single-source suppliers, may adversely affect manufacturing and supply of our Motiva Implants and other products.
- A substantial proportion of our sales are through exclusive distributors, and we do not have direct control over the efforts these distributors may use to sell our products. If our relationships with these third-party distributors deteriorate, or if these third-party distributors fail to sell our products or engage in activities that harm our reputation, or fail to adhere to medical device regulations, our financial results may be negatively affected.
- Risks Related to Public Health Crises
- Pandemics, epidemics, or other public health crises may adversely affect our business and financial results in the future, as was the case with the COVID-19 pandemic in recent years.
- Risks Related to Intellectual Property and Data Security
- If we are unable to protect the confidentiality of our trade secrets, the value of our technology could be materially adversely affected, harming our business and competitive position.
- If we are not able to obtain and maintain intellectual property protection for our products and technologies, or if the scope of our patents is not sufficiently broad, we may not be able to effectively maintain our market leading technology position.
- We may not be able to protect or enforce our intellectual property rights throughout the world.
- We may become involved in legal proceedings to protect or enforce our intellectual property rights, which could be expensive, time consuming, or unsuccessful.
- The medical device industry is characterized by patent litigation and we could become subject to litigation that could be costly, result in the diversion of management’s time and efforts, require us to pay damages or prevent us from marketing our existing or future products.
- Obtaining and maintaining patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.
- If we fail to comply with our obligations in our intellectual property agreements, we could lose intellectual property rights that are important to our business.
- Our information systems, or those used by third parties which we rely on, may fail, be impacted by cybersecurity incidents, suffer other security breaches or be vulnerable to other forms of attack or damage.
- Our failure to adequately protect personal information in compliance with evolving legal requirements could harm our business.
- Risks Related to Regulatory and Political Environment
- The regulatory approval process is expensive, time consuming and uncertain. Our future success depends on our ability to develop, receive regulatory clearance or approval for, and introduce new products that will be accepted by the market in a timely manner. There is no guarantee that the FDA will authorize the commercialization of Motiva Implants or our planned products on a timely basis, if at all, and failure to obtain necessary clearances or approvals would adversely affect our ability to grow our business.
- Once commercialized, modifications to our marketed products may require new 510(k) clearances or approval of PMA supplements, or equivalent steps in other countries, or may require us to cease marketing or recall the modified products until certification, clearances or regulatory approvals are obtained.
- Even if we receive regulatory approval for a planned product, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense and subject us to penalties if we fail to comply with applicable regulatory requirements.
- Our products may cause or contribute to adverse medical events or be subject to failures or malfunctions that we are required to report to the FDA, and if we fail to do so, we would be subject to sanctions that could harm our reputation, business, financial condition and results of operations. The discovery of serious safety issues with our products, or a recall of our products either voluntarily or at the direction of the FDA or another governmental authority, could have a negative impact on us.
- We are subject to extensive and dynamic medical device regulation, and oversight in the United States and other countries. If we fail to obtain or maintain necessary regulatory approvals for our products, or if approvals or clearances for future products are delayed or not issued, it will negatively affect our business, financial condition and results of operations.
- Our products, such as Motiva Implants, may in the future be subject to product recalls that could harm our reputation, business and financial results.
- The medical technology industry is complex and intensely regulated at the federal, state, and local levels and government authorities may determine that we have failed to comply with applicable laws or regulations.
- If we obtain approval for our products, we may be subject to enforcement action if we engage in improper marketing or promotion of Motiva Implants or our other products.
- Our relationship with customers and third party payors will be subject to applicable anti-kickback, fraud and abuse, and other health care laws and regulations, which could expose us to criminal sanctions, civil penalties, damages, reputational harm and diminished profits and future earnings.
- Health care reform measures could hinder or prevent our planned products’ commercial success.
- The coverage and reimbursement status of newly-approved products is uncertain. Failure to obtain or maintain adequate coverage and reimbursement for new or current products could limit our ability to market those products and decrease our ability to generate revenue.
- The political situation in the United States can affect the ability of our company to conduct business in certain areas or countries if new trade conditions are imposed or enforced by the U.S. government.
- The global economic instability caused by the ongoing military conflicts in Ukraine and Israel may adversely affect our business in Europe and the Middle East.
- Risks Related to Taxation
- Tax authorities may disagree with our positions and conclusions regarding certain tax positions, resulting in unanticipated costs, taxes or non-realization of expected benefits.
- We are a multinational organization faced with increasingly complex tax issues in many jurisdictions, and changes in tax laws or their application to the operation of our business could adversely impact our operating results and our business.
- Our ability to use net operating losses to offset future taxable income and certain other tax attributes may be subject to certain limitations.
- U.S. holders of our common shares may suffer adverse tax consequences if we are characterized as a passive foreign investment company.
- If a United States person is treated as owning at least 10% of our common shares, such holder may be subject to adverse U.S. federal income tax consequences.
- Discontinuation of preferential tax treatments we currently enjoy or other unfavorable changes in tax law could result in additional compliance obligations and costs.
- Risks Related to Ownership of Our Securities
- Our share price may be volatile, and purchasers of our securities could incur substantial losses.
- Risks Related to Being a British Virgin Islands Company
- Rights of shareholders under British Virgin Islands law differ from those under U.S. law, and, accordingly, you may have fewer protections as a shareholder.
- British Virgin Islands companies may not be able to initiate shareholder derivative actions, thereby depriving shareholders of one avenue to protect their interests.
- British Virgin Islands law differs from the laws in effect in the United States, and U.S. investors may have difficulty enforcing civil liabilities against us, our directors or members of senior management.
- The laws of the British Virgin Islands provide limited protection for minority shareholders, so minority shareholders will have limited or no recourse if they are dissatisfied with the conduct of our affairs.
- Provisions in our amended and restated memorandum and articles of association and under British Virgin Islands law could make an acquisition of us more difficult and may prevent attempts by our shareholders to replace or remove our current management.
Management Discussion
- Revenue increased $3.5 million, or 2.2%, to $165.2 million for the year ended December 31, 2023, as compared to $161.7 million for the year ended December 31, 2022. The increase was primarily due to share gains in global markets and the launch of new products and technologies. The first half of 2023 resulted in record quarterly revenue, primarily due to strong demand in our EMEA and in Asia-Pacific regions. The third and fourth quarters of 2023 showed a slowing in revenue growth, primarily in distributor markets in our Asia-Pacific and, to a lesser degree, in Latin American regions, compared to the first half of 2023. We believe the slower growth is a result of an overall slowdown in demand for aesthetic procedures primarily as a result of general uncertainty about macroeconomic and geopolitical conditions and seasonality.