Diabetes is typically classified as either type 1 or type 2:

We estimate that approximately one-third40% of the type 1 diabetes population in the United States and even less of the international type 1 diabetes population use insulin pump therapy. An even smaller portion of the U.S. and international insulin-requiringinsulin-intensive type 2 diabetes population use insulin pump therapy. We believe these factors present a significant available market for theour Omnipod Systemplatform globally.

MDI therapy involves the administration ofinjecting fast-acting insulin before meals (bolus) to lower blood glucose levels to a healthy range. MDI therapy may also require a separate injection of a long-acting (basal) insulin, to control glucose levels between meals; typically, once or twice per day. By comparison, insulin pump therapy uses only fast-acting insulin to fulfill both mealtime (bolus) and background (basal) requirements. Insulin pump therapy allows individuals to customize their bolus and basal insulin doses to meet their insulin needs throughout the day and is intended to more closely resemble the physiologic function of a healthy pancreas.

Insulin pumps perform continuous subcutaneous insulin infusion and typically use a programmable device and an infusion set to administer insulin into the body. Insulin pump therapy has been shown to provide numerous advantages relative to MDI therapy. For example, insulin pump therapy eliminates individual insulin injections, (approximately five per day), delivers insulin more accurately and precisely than injections, often improves HbA1c (a common measure of blood glucose levels) over time, provides greater flexibility with meals, exercise, and daily schedules, and can reduce severe low blood glucose levels. We believe that these advantages, along with technological advancements, including the use of continuous glucose monitoring technology and automated insulin device (“AID”) algorithms, and increased awareness of insulin pump therapy will continue to generate demand for insulin pump devices.

connection if established. The Pod currently integrates with Dexcom, Inc.’s G6 CGM and we recently launched a limited market release with Dexcom’s G7 CGM. Additionally, we plan to launch Omnipod 5 with Abbott Diabetes Care, Inc.’s FreeStyle Libre 2 Plus sensor (“Libre 2 Plus”) in certain international markets in 2020 and 2021. It2024.

We have designed the Omnipod SystemDASH to fit within the normal daily routines of users. The Omnipod SystemDASH communicates wirelessly, provides for virtually pain-free automated cannula insertion, and eliminates the need for MDI therapy or the use of pump and tubing. The Pod can be worn for up to three days at a time and, because it is waterproof (with an IP28 rating for up to 25 feet for 60 minutes), there is no need to remove it when showering, swimming, or performing other activities. The

The product was developed to serve people with type 12 diabetes has found that comparedearlier in their treatment journey by starting them on Pod therapy for their insulin delivery, rather than daily injections. As a patient progresses to prior treatment modality,requiring additional insulin, including basal and bolus, the use oftransition from Omnipod GO to another Omnipod product will be a natural progression.

We developed Omnipod GO with convenience in mind for both the primary care physician and the user, including with respect to prescribing, getting started, training and using the product. We are currently conducting a pilot program for Omnipod System is associated with improved quality of life. We believe that this data is clinically meaningful to healthcare providers and provides support for the use of the Omnipod SystemGO in the treatment of both type 1 and type 2 diabetes.United States.

In certainour international locations in which we sell either directly to consumers or through a distributordistributor/intermediary. In all countries where we operate either Insulet or intermediary, our distribution partners and local intermediaries establish appropriate reimbursement contracts with healthcare systems in those countries and provinces. Reimbursement structures vary by country and our unique offering allows us to provide Pod therapy in attractive pricing structures that reduce the risk to payors while expanding access.

We sell the Omnipod Systemproducts directly to consumers, through distribution partners and in the U.S., also through the pharmacy channel. For the year ended December 31, 2021, 76%2023, 90% of our Omnipod Systemproduct sales globally were through intermediaries. The Omnipod System is also marketed to physicians.

We also produce our devices on manufacturing lines at a facility in Kunshan (Shanghai), China operated by a contract manufacturer. This contract manufacturing agreement expires in December 2022October 2025 and is subject to automatic renewal, unless canceled by either party under the terms of the contract. We have recently optimizedIn December 2023, we completed construction of our operations in China by consolidating our production in that region into this one location. Additionally, we plan to invest in a new manufacturing plant in anotherMalaysia to support our international locationexpansion strategy and further ensure product supply. We expect to further diversify globally and increase efficiency.begin production at this facility in 2024.

We also continue to invest in supply chain efficiencies, including automation improvements at our suppliers and contract manufacturer. In addition, in January 2022, we acquired one of our suppliers to bring key intellectual property and expertise in-house, strengthen our production capabilities and mitigate supply chain risks.

Unless an exemption applies, each medical device we seek to commercially distribute in the United States will require either prior 510(k) clearance or pre-market approval (“PMA”) from the FDA. A 510(k) pre-market notification filing must contain information establishing that the device to be sold is substantially equivalent to a device commercially distributed prior to May 28, 1976 or to a device that has been determined by the FDA to be substantially equivalent. Both the 510(k) clearance and PMA processes can be expensive and lengthy and entail significant user fees. We have obtained 510(k) clearance for theClassic Omnipod, Omnipod DASH, Omnipod 5, and Omnipod 5 SystemsGO and expect that regulatory approvalclearances or approvals will be needed

for some of our future products. In addition, we

Our clinical trials must be conducted in accordance with FDA regulations and federal and state regulations concerning human subject protection, including informed consent and healthcare privacy. A clinical trial may be suspended by the FDA or at a specific site by the relevant IRB at any time for various reasons, including a belief that the risks to the trial participants outweigh the benefits of participation in the clinical trial. Even if a clinical trial is completed, the results of our clinical testing may not demonstrate the safety and efficacy of the device or may be equivocal or otherwise insufficient for us to obtain approval of our product.

Failure to comply with applicable regulatory requirements can result in enforcement actions by the FDA and other regulatory agencies, which may include any of the following sanctions: untitled letters or warning letters, fines, injunctions, consent decrees, civil or criminal penalties, recall or seizure of our current or future products, operating restrictions, partial suspension or total shutdown of production, refusal of or delay in granting 510(k) clearance or PMA of new products or modified products, rescinding previously granted 510(k) clearances or withdrawing previously granted PMAs, or refusal to grant import or export approval of our products.

We are subject to announced and unannounced inspections by the FDA, and these inspections may include the manufacturing facilities of our subcontractors. If, as a result of these inspections, the FDA determines that our equipment, facilities, laboratories, or processes do not comply with applicable FDA regulations and conditions of product approval, the FDA may seek civil, criminal, or administrative sanctions and/or remedies against us, including the suspension of our manufacturing operations. Since approvalclearance of the first generation of our Omnipod System,product, we have been subject to FDA inspections of our facilities on multiple occasions.

We are required to work with intermediaries who have the appropriate pharmacy license for the applicable market.

The federal Anti-Kickback Statute has been interpreted to apply to arrangements between drug and medical device manufacturers and suppliers on one hand and prescribers, patients, purchasers, and formulary managers on the other. Liability under the statute may be established without a person or entity having actual knowledge of the statute or specific intent to violate it. In addition, claims resulting from a violation of the federal Anti-Kickback Statute constitute false or fraudulent claims for purposes of the federal civil False Claims Act which is addresseddiscussed below. Although there are a number of statutory exemptions and regulatory safe harbors protecting certain common business practices from prosecution and administrative sanctions, the exemptions and safe harbors are drawn narrowly, and practices that involve remuneration that may be perceived as inducing the prescription, purchase, or recommendation of the Omnipod Systemproducts may be subject to scrutiny under the law. For example, we may provide the initial training to users necessary for appropriate use of the Omnipod Systemour product either through our own diabetes educators or by contracting with outside diabetes educators that have completed a Certified Pod Trainer course. We compensate outside diabetes educators for their services at contracted rates deemed to be consistent with the market. We have structured our arrangements with diabetes educators and other business practices to comply with statutory exemptions and regulatory safe harbors whenever possible, but our practices may be subject to scrutiny if they fail to strictly comply with the criteria in the exemption or regulatory safe harbor. Moreover, there are no safe harbors for many common practices such as

Federal law also includes a provision commonly known as the “Stark Law,” which prohibits a physician from referring Medicare or Medicaid patients to an entity for the furnishing of certain “designated health services,” including durable medical equipment, in which the physician has an ownership or investment interest or with which the physician has entered into a compensation arrangement. Violation of the Stark Law could result in denial of payment, disgorgement of reimbursements received for items and services referred by a physician with a noncompliant arrangement, civil damages and penalties, and exclusion from Medicare, Medicaid, or other governmental programs. Although there are statutory and regulatory exceptions protecting certain common business practices, and we have structured our arrangements with physicians and other providers to comply with these exceptions, these arrangements may not expressly meet the requirements for applicable exceptions from the Stark Law.

Since these laws and regulations continue to evolve, we lack definitive guidance as to the application of certain key aspects of these laws and regulations as they relate to certain of our arrangements and programs, including those with providers with

respect to user training. We cannot predict the final form of these federal and state regulations or the effect their application will have on us. As a result, our provider and training arrangements may ultimately be found not to be in compliance with applicable federal law. Moreover, these laws continue to evolve. The Bipartisan Budget Act of 2018 increased the criminal and civil penalties that can be imposed for violating certain federal healthcare laws, including the Anti‑Kickback Statute. Additionally, in late 2020, the United States Department of Health and Human Services’ Office of the Inspector General (“OIG”) finalized a rule that will remove protection from the discount safe harbor to the federal healthcare Anti-Kickback Statute for manufacturers rebates to pharmacy benefit managers (or “PBMs”), Medicare Part D plans and Medicaid managed care organizations (“MCOs”), effective January 2022. The rule also includes a new safe harbor for point-of-sale reductions offered by manufacturers to Part D plans, Medicaid MCOs and their PBMs, and a new safe harbor for certain fees manufacturers pay to PBMs for services to the manufacturers. The rule was finalized consistent with an Executive Order issued by the President in 2020; with the change in Administrations, it is possible that the rule may be revised before it is fully effective. If it takes effect as written, the rule will be one of the most significant amendments to the Anti-Kickback Statute regulatory safe harbors in decades and likely will transform manufacturer interactions with Part D plans, Medicaid MCOs and their PBMs.laws.

Ensuring that our business arrangements and interactions with healthcare professionals, third‑party payors, customers and others comply with applicable healthcare laws and regulations requires substantial resources. Because of the breadth of these laws and the narrowness of the exceptions or safe harbors, it is possible that some of our business activities could be subject to challenge under one or more of these laws.

The primary regulatory body in Europe is that of the European Union, which includes most of the major countries in Europe. Other countries, such as Switzerland, have voluntarily adopted laws and regulations that mirror those of the European Union with respect to medical devices. The European Union has adopted numerous directives and standards regulating the design, clinical trials, manufacture, labeling, and adverse event reporting for medical devices, including the Medical Device Directive (“MDD”) and the Medical Device Regulation (“MDR”),MDR, which replaced MDD in May 2021. Devices that comply with the requirements of the MDD will be entitled to bear the CE conformity marking and, accordingly, can be commercially distributed until May 2024, at which time devices must comply with the MDR.MDR, unless certain requirements are met that would allow for an extension until December 2027. The method of assessing conformity with the applicable directive varies depending on the class of the product, but normally involves a combination of self-assessment by the manufacturer and a third-party assessment by a “Notified Body”. The latter is required in order for a manufacturer to commercially distribute the product throughout the European Union. This third-party assessment may consist of an audit of the manufacturer’s quality system and specific testing of the manufacturer’s product. Outside of the European Union, regulatory approval needs to be sought on a country-by-country basis for us to market our products.

We have obtained the right to affix the CE Mark to theClassic Omnipod and Omnipod DASH Systems, which allows usunder the MDD. We can continue to distribute these products throughoutsell Classic Omnipod through 2027 under MDD in the European Union and in other countries that recognize the CE Mark.Mark and are awaiting certification under MDR for Omnipod DASH. We have obtained the right to affix the CE Mark to Omnipod 5 under MDR, which allows us to distribute it throughout the European Union and in the United Kingdom. In addition weto these countries, Omnipod DASH can be marketed in the Gulf Cooperation Council Countries and in Australia. We also have Health Canada approval to sell these productsClassic Omnipod and Omnipod DASH in Canada.

A range of anti-bribery and anti-corruption laws, as well as industry specific laws and codes of conduct, apply to the medical device industry and interactions with government officials and entities and healthcare professionals. These laws include the U.K. Bribery Act and similar antibribery laws in other jurisdictions in which we operate. Such laws generally prohibit U.S.-based companies and their intermediaries from making improper payments for the purpose of obtaining or retaining business to foreign officials, or in the case of the U.K. Bribery Act, to any person. In addition, the European Union Whistleblower Directive (effective in late 2023) and other applicable law around the world impose specific requirements on companies regarding speak up policies and non-retaliation policies.

To assess and improve employee retention and engagement and identify potential opportunities for improvement, we survey employees with the assistance of third-party consultants,conduct periodic ‘Your Voice’ employee pulse surveys and take timely action to address key areas of employee concern. We regularly conduct engagement surveys to gain valuable insight into our employees’ experience and identify areas for improvement. In 2021, we heard from employees through a variety of surveys focused on wellness, work-life balance, and the workplace of the future. In 2022, we implemented a new approach to engagement. Instead of conducting an engagement survey once per year, we will perform short pulse surveys three to four times per year to better understand opportunities to improve our talent management strategy and gain a more dynamic view of our employees’ needs. Our senior leadership team assesses engagement to understand and identify potential opportunities for improvement.

Our Employee Resource Groups (“ERG”ERGs”) serve as a source of inclusion across seventhe following nine categories: African Descent, Asian and Pacific Islander, Hispanic/Latin, LGBTQ+, Sustainability, Veterans and First Responders, Women, Young Professionals, and Young Professionals.Jewish Heritage. These ERGERGs support the acquisition of diverse talent and are sponsored by senior leaders across our organization.

We are committed to providing comprehensive benefit options that allow our employees and their families to live healthier and more secure lives. Our wide-ranging benefits include:include health insurance, telehealth, prescription drug benefits, dental insurance, vision insurance, 80 hours of COVID-19 paid sick time, accident insurance, critical illness insurance, life insurance, disability insurance, health savings accounts, flexible savings accounts, retirement plans, employee stock purchase plan, legal services, identity theft protection, maternity/paternity leave, tuition and professional certification course reimbursement, and employee assistance program. In addition, we offer a free online wellness program; subsidized child, senior care or pet services, and access to personal services; free virtual babysitting and tutoring services; Pod perks, which provides a free Omnipod System,5 or Omnipod DASH product, including PDMPDM/Controller and Pods to benefit eligible employees, interns, or dependents;dependents. We also offer summer hours;hours and a flexible work policy. In addition, our employee stock purchase plan is availablearrangements, including the opportunity to all full-time employeeswork remotely, which allows us to access a broader, more diverse, and has a participation rate of over 60%.

Modern manufacturing enables efficiency and automation, which reduces exposure to health and safety risks throughout the production process. At our facilities, the majority of our equipment is fully automated to minimize human involvement in the operations of machines and therefore reduce the risk of injury. We maintain high standards for workplace safety, and our orientation for technicians includes training about safe procedures, such as lockout/tagout. All employees working in our machine shop must also attend training to understand and comply with safety protocols.

We have a Health and Safety Compliance Manual to provide employees with the tools needed to identify and report hazards and reduce work relatedwork-related injuries. Our programs and policies are in compliance with applicable local, regional, and federal laws, including U.S. Occupational Safety and Health Administration requirements. We continuously monitor and adapt to regional regulations as we expand our facilities into new geographies. In addition to hazard recognition, our workplace health and safety programs cover ergonomics, hearing conservation, fall protection, and accident and injury prevention. Furthermore, we added a detailed program on contractor safety in 2021 to support the health and well-being of the contractors who work with us on various aspects of our operations every day.

We also have formal plans in place to protect our employeesemployees' safety in the event of an emergency. In addition, we haveour Acton, Massachusetts facility maintains an Emergency Action Plan for our Acton, Massachusetts facility that outlines processesdescribes procedures that our employees mustshould follow duringwhen faced with a variety of unexpected health and safety events. As part of this initiative, we have trained certain employees to use automated external defibrillators, provide first aid, and perform cardiopulmonary resuscitation (CPR). In 2023, we implemented a text emergency system for our employee base located in our Acton headquarters and Acton manufacturing facility, which advises employees on building closures and emergencies with clear instructions. We are also planning to schedule annual emergency evaluation drills to enhance theconduct periodic health and safety audits of our facility.

If any of these events occurs,occur, our ability to generate revenue could be significantly reduced, which would adversely affect our business, financial condition, and results of operations.

It is unclear how the ACA and its implementation, as well as efforts to repeal or replace, or invalidate, the ACA, or portions thereof, will affect our business. Additional legislative changes, regulatory changes, and judicial challenges related to the ACA remain possible. It is possible that the ACA, as currently enacted or as it may be amended in the future, and other healthcare reform measures that may be adopted in the future, could have an adverse effect on our industry and on our ability to maintain or increase sales of any of our products.

In addition, future clinical studies or articles regarding our existing products or any competing products may be published that either support a claim, or are perceived to support a claim, that a competitor’s product is clinically more effective or easier to use than the Omnipod Systemour products or that the Omnipod System isour products are not as effective or easy to use as we claim. Additionally, diabetes associations, healthcare providers that focus on diabetes, or other organizations that may be viewed as authoritative could endorse products or methods that compete with the Omnipod Systemour products or otherwise announce positions that are unfavorable to the Omnipod System.our products. Any of these events may negatively affect our sales efforts and result in decreased revenue.

Our ability to compete depends in part on our continued ability to develop or acquire commercially valuable intellectual property rights and to protect those rights adequately. We may not be able to develop additional proprietary technologies that are patentable. Further,patentable, and we cannot ensure that our pending patent applications will result in the issuance of patents to us, that patents issued to or licensed by or to us in the past or in the future will not be challenged or circumvented by competitors or that these patents will be found to be valid or sufficiently broad to preclude our competitors from introducing technologies similar to those covered by our patents and patent applications. In addition, our ability to enforce and protect our intellectual property rights internationally may be limited in certain circumstances. For example, we may not be able to protect our intellectual property rights effectively in China, where we rely on a third-party contract manufacturer to produce our product. The occurrence of any of these events could have a material adverse effect on our business, financial condition and results of operations.

Such litigation, regardless of its outcome, could result in the expenditure of significant financial resources and the diversion of management’s time and resources. In addition, such litigation could cause negative publicity, adversely affect prospective users, cause product shipment delays, limit or prohibit us from manufacturing, marketing or selling our current or future products, and/or require us to develop non-infringing technology, make substantial payments to third parties, or enter into royalty or license agreements, which may not be available on acceptable terms or at all. If a successful claim of infringement were made against us and we could not develop non-infringing technology or license the infringed or similar technology on a timely and cost-effective basis, our revenue could decrease substantially, and we could be exposed to significant liability. A court could enter orders that temporarily, preliminarily, or permanently enjoin consumers from using our products or us from manufacturing, selling, or importing our products, or could enter an order mandating that we undertake certain remedial activities.

TheAnother global pandemic like COVID-19 pandemic also has the potential to significantly impact our supply chain if the manufacturing plants that produce our products or product components, the distribution centers where we manage our inventory, or the operations of our logistics and other service providers, including third parties that sterilize our products, are disrupted, temporarily closed or experience worker shortages for a sustained period of time. Although China, where we manufacture a significant portion of our product, has experienced a recovery and we are currently producing at pre-COVID-19 levels, should China suffer a COVID-19 relapse, it could hinder our ability to produce product and have a material adverse effect on our business and results of operations.

As a result of the COVID-19 pandemic, many employees have transitioned to a remote or hybrid work environment, which has increased risks associated with our information technology systems and networks. These increased risks include cyber-attacks, computer viruses, disruptions, or shutdowns that could result in a failure to protect our information technology systems and data integrity.

The further spreadAnother global pandemic or new variants of COVID-19, and the requirements to take action to help limit the spread of the illness, maycould impact our ability to carry out our business as usual. For example, the COVID-19 pandemic may divertdiverted healthcare resources away from the conduct of clinical trials and interruptinterrupted the operations of the FDA, and comparable foreign regulatory agencies, which could delaydelayed product approval timelines, as it didincluding for Omnipod 5.

Our efforts to introduce or expand our current or future products in international markets may not be successful, in which case we may have expended significant resources without realizing the expected benefit. Ultimately, the investment required for expansion into international markets could exceed the results of operations generated from this expansion.

In addition to the risks discussed elsewhere in this Item 1A, other risks associated with doing business internationally, include:

Our reliance on these third-party suppliers, alsoas well as on our third-party manufacturer, subjects us to other risks that could harm our business, including:

We also are subject to numerous post-marketing regulatory requirements, which include quality system regulations related to the manufacture of our devices, labeling regulations, and medical device reporting regulations. The last of these regulations requires us to report to the FDA if our devices cause or contribute to a death or serious injury, or malfunction in a way that would likely cause or contribute to a death or serious injury if the malfunction recurred. If we fail to comply with present or future regulatory requirements that are applicable to us, we may be subject to enforcement action by the FDA, which may include any of the following sanctions:

In addition, the FDA may change its clearance and approval policies, adopt additional regulations, or revise existing regulations, or take other actions that may prevent or delay approval or clearance of our products under development or impact our ability to modify our currently approved or cleared products on a timely basis. The FDA is in the process of reviewing the 510(k) approvalclearance process and criteria and has announced initiatives to improve the current pre- and post-market regulatory processes and requirements associated with infusion pumps and other home use medical devices. As part of this effort, the FDA is reviewing the adverse event reporting and recall processes for insulin pumps. Any change in the laws or regulations that govern

The Omnipod System isWe also soldsell our products in Canada, Australia and certain countries in Europe and the Middle East. As a result, we are required to comply with additional foreign regulatory requirements. As we expand our sales efforts internationally, we may need to obtain additional foreign approval certifications. Failure to fulfill foreign regulatory requirements on a timely basis or at all could adversely affect our ability to grow our business.

We conduct various marketing and product training activities that involve making payments to healthcare providers and entities. While we believe and make every effort to ensure that our business arrangements with third parties and other activities and programs comply with all applicable laws, these laws are complex and our activities may be found not to be compliant with one of these laws, which may result in significant civil, criminal, and/or administrative penalties, fines, damages, and exclusion from participation in federal healthcare programs. Even an unsuccessful challenge or investigation into our practices could cause adverse publicity, and be costly to respond to, and thus could have a material adverse effect on our business, financial condition, and results of operations. Our compliance with Medicare and Medicaid regulations may be reviewed by federal or state agencies, including the OIG, CMS, and the Department of Justice, or may be subject to whistleblower lawsuits under federal and state false claims laws. To ensure compliance with Medicare, Medicaid, and other regulations, government agencies conduct periodic audits of us to ensure compliance with various supplier standards and billing requirements.

We are subject to a variety of laws and regulations relating to privacy and data protection, data security, data retention and deletion, personal information, electronic contracts, and other communications. The introduction of new products or expansion of our activities in certain jurisdictions may subject us to additional laws and regulations. For example, data privacy laws at the federal and state levels protect the confidentiality of certain health information and restrict the use and disclosure of that protected information. In particular, the U.S. privacy rules under HIPAA protect medical records and other personal health information by limiting their use and disclosure, giving individuals the right to access, amend, and seek accounting of their own health information, and limiting most use and disclosures of health information to the minimum amount reasonably necessary to accomplish the intended purpose. At least fifteen states have adopted new privacy laws in the past few years. In California, the CCPA, which provides certain privacy rights and consumer protection for residents of the state became effective in 2020, and additional regulation under the CPRA, which amends and expands the CCPA, will take effect in 2023.2024. These consumer rights include the right to know what personal information is collected, the right to know whether the data is sold or disclosed and to whom, the right to request a company to delete the personal information collected, the right to opt-out of the sale of personal information, and the right to non-discrimination in terms of price or service when a consumer exercises a privacy right. Colorado and VirginiaThe California laws have enactedserved as a model for many subsequently adopted laws in other states. In 2023, similar privacy laws that will also take effectbecame effective in 2023.Colorado and Virginia. California and other states’ laws apply more broadly and now or in the future may reach data we hold that relates to employees and healthcare providers, not just customers. In addition, data security protection laws passed by the federal government and many states require notification to data subjects, including customers and others, when there is a security breach of personal data. If we fail to comply with these regulations, we could be subject to civil sanctions, including fines and penalties for noncompliance.

In addition, foreign data protection, privacy, and other laws and regulations can be more restrictive than those in the United States. Data localization laws in some countries generally mandate that certain types of data collected in a particular country be stored and/or processed within that country. We could be subject to audits in Europe and around the world, particularly in the areas of consumer and data protection, as we continue to grow and expand our operations. Legislators and regulators may make legal and regulatory changes, or interpret and apply existing laws, in ways that make our products less useful to users, require us to incur substantial costs, expose us to unanticipated civil or criminal liability, or cause us to change our business practices.

The increased scope of regulation around the world may require expanded compliance programs and resources. As our efforts to gain insights from data increase for the operation of our products and services and for the improvement of business processes, including sales and marketing, our exposure to increasingly complex privacy regulation may impede our ability to use data in this way.

Additionally, the FDA has warned that insulin pumps may have cybersecurity vulnerabilities and could be manipulated by hackers, causing danger to people with diabetes. After extensive testing and research in conjunction with an independent third-party firm, a potential security vulnerability in theClassic Omnipod was identified. (This vulnerability does not exist in Omnipod DASH or Omnipod 5.) Successful exploitation of this vulnerability may allow an attacker to gain access to the Pod to intercept, modify, or interfere with the wireless RFradio frequency communications to or from the PDM. This may allow attackers to read sensitive data, change pump settings, or control insulin delivery.

Insulet is aware of a specific group of people with diabetes who have been able to duplicate the Pod communication protocol using a smartphone and a bridge, which in turn allows the Pod to be controlled using an unauthorized device. This practice is commonly referred to as Do-It-Yourself (DIY) and is not the intended use for thewith Omnipod System.products. Insulet has not provided the DIY community with any type of information or input on the product, nor has Insulet been provided with any information proving that this form of off-label use is a safe use of the system. This practice does not exist with Omnipod 5.

If our product is breached or our information technology systems are breached or suffer severe damage, disruption, or shutdown and we are unable to effectively resolve the issues in a timely manner, our reputation, business, and operating results may be materially adversely affected.

Our long-term financial objective is to sustain profitable growth. To achieve this goal, our efforts have been focused onwe launched Omnipod 5 in the United States in August 2022 and in the United Kingdom and Germany in June and August 2023, respectively. Subsequent to the launch of Omnipod 5, which recently received FDA clearance for individuals aged six yearswe began to phase-out our Classic Omnipod in the U.S. in 2023, since the vast majority of our U.S. customer base is no longer using this product.

We are working on further building our international teams and older with type 1 diabetes. Our limitedadvancing our regulatory, reimbursement, and market release ofdevelopment efforts so we can bring Omnipod 5 is underway. Additionally, we have completed our FDA submission to expand Omnipod 5’s indication down to age two, and are planning for an expanded indication in 2022.additional international markets. We have also recently completed our type 2 feasibility study and plan to conduct additional studieslaunch Omnipod 5 in more European markets in 2024 starting with the Netherlands. Additionally, in December 2023, we completed enrollment for our pivotal trial for Omnipod 5 with the goal to further expandof expanding Omnipod 5’s indication to type 2 users. In our effortsWe expect to bringcomplete the trial and submit to the FDA for an expanded indication by the end of 2024.

We have completed a randomized control trial in the U.S. and France for Omnipod 5 to international markets, we have submitted for CE Marking in Europe under MDR.

We also continue to focus on adding capacity to our U.S. manufacturing plant. During 2021, we began producing salable product on our third highly automated manufacturing line. We have also takentake steps to strengthen our global manufacturing capabilities. We have optimized our operations in China by consolidating our production in that region into one location and we plan to invest inrecently completed construction of a new manufacturing plant in anotherMalaysia to support our international location toexpansion strategy, further diversify globallyensure product supply, and increase efficiency to drive higher gross margins over time.

Finally, we plan to continue to expand awareness of and access to our products, while also focusingfocus on our product development efforts. The latter includesefforts, including AID offerings such as choice of smartphone integration and CGM, and enhancing the customer experience through digital product offerings. Achievingand data capabilities. In February 2024, we began our limited market release of Omnipod 5 with Dexcom’s G7 CGM in the above strategic imperatives is expectedUnited States and received CE mark approval for the added compatibility of Libre 2 Plus with Omnipod 5 for individuals aged two years and older with type 1 diabetes. We expect to require additional investmentslaunch a limited market release of Omnipod 5 with Libre 2 Plus in certain initiativesthe U.K. and personnel, as well as enhancementsthe Netherlands in 2024. Additionally, we received FDA clearance for the Omnipod 5 App for iPhone in the fourth quarter of 2023 and plan to our supply chain operation capacity, efficiency and effectiveness.launch a limited market release in the U.S. in 2024.

During 2020 and 2021,In 2022, we were subjectissued two voluntary Medical Device Corrections (“MDCs”), one in October for our Omnipod DASH PDM related to challenging conditions stemming from the coronavirus pandemic (“COVID-19” or the “pandemic”). Containment efforts and responses to the pandemic have varied by individuals, businesses, state and local municipalities, and region. We believe people were less likely to change the way they manage their diabetes during the pandemic for a variety of reasons including temporary closure of doctors’ offices or a general unwillingness to visit a doctor’s office or hospital during the pandemic, particularly since those with diabetes are deemed at higher risk of suffering complications from COVID-19. While the pandemic had a negative impact on new customer startsits battery and the effects will not be fully reflectedother in November for our Omnipod 5 Controller related to its charging port and cable. During 2022, we initially recorded a net charge of $57.9 million related to these MDCs. During the year ended December 31, 2023, we recorded $11.5 million of income associated with a change in our results of operations and overall financial performance until future periods, we believe our overall recurring revenue model provides a solid financial foundationestimated liability for strong cash flow generation. Further, the pandemic had a positive impact on our Drug Delivery revenue.MDCs, primarily due to lower distribution costs.

We have also experienced and may continue to experience challenges stemming from the global supply chain disruption; however, while there is no guarantee of future performance, to date we have been able to successfully mitigate any disruption. See “Risk Factors”this disruption and ensure uninterrupted supply to our customers by increasing our inventory levels and taking other measures. While our mitigation efforts and inflation have and are expected to continue to negatively impact gross margins and net income in Part I, Item 1A of this Annual Report for further discussion of the possible impact of the COVID-19 pandemic on our business.2024, we intend to continue to work to improve productivity to help offset these costs.

Total revenue for 20212023 increased $194.4$391.8 million, or 21.5%30.0%, to $1,098.8$1,697.1 million, compared with $904.4$1,305.3 million in 2020.2022. Constant currency revenue growth of 19.7%29.6% was primarily driven by higher volume and, to a lesser extent, favorable sales channel mix. This increase wasmix, partially offset by decreased drug delivery revenue.

Revenue from the impactsale of Omnipod products in the pandemic on our recurring revenue. U.S. Omnipod revenue for 2021 includes $58.2$473.7 million of related party revenue thatin 2023, compared with $249.9 million in 2022. The $223.8 million increase primarily resulted from a shift in certain revenues from one distributor to another.growth through the pharmacy channel. Additional information regarding our related party transactions is provided in Note 5. 5 to our consolidated financial statements.

In 2022,2024, we expect strong OmnipodU.S. revenue growth driven by continued volume growth of Omnipod 5, continued sales of Omnipod DASH, primarilyand the benefits of our recurring revenue model and pharmacy channel access. We expect these increases to be partially offset by lower conversions from Classic Omnipod and Omnipod DASH to Omnipod 5 in the pharmacy channel.first half of the year compared to 2023 since the vast majority of conversions to Omnipod 5 occurred in 2023.

We expect gross margin for 20222024 to be in the range of 67%68% to 68%69%. We anticipate gross margin to be relatively level due to higher average selling prices primarily due to growth in the pharmacy channel and improved manufacturing efficiencies, partially offset by $11.5 million of income associated with a reduction to our MDC liability in 2023, which will be negatively impacted by unfavorable product mix,not recur, and higher costs associated with Omnipod 5 production, and continued higher production costs as we further scale U.S. manufacturing, and contend with inflation and global supply chain disruptions. We believe these higher costs will be partially offset by the benefits of continued improvements in global manufacturing and supply chain operations and increased volumes in the pharmacy channel.our new product launches.

We expect selling, general and administrative expenses to increase in 20222024 compared with 20212023 due to expansion of our sales force and customer support personnel, investments to expand market acceptance and access for the Omnipod System, including direct-to-consumer advertising, and investments in our operating structure, primarily headcount additions, to facilitate operational efficienciescontinued growth, including customer support. Additionally, we plan to make additional investments to support our Omnipod platform, including market acceptance and continued growth.access, and the phased launch of Omnipod 5 in our international markets.

We maintain a $202.9 million valuation allowance on net deferred tax assets at December 31, 2023. Given our current year lossesearnings and anticipated future earnings, we believe that there is a reasonable possibility that within the next 12 months, sufficient positive evidence may become available to allow us to reach a conclusion that a significant portion of our valuation allowance will no longer be needed. A release of the valuation allowance would result in the United Kingdom duerecognition of certain deferred tax assets and a decrease to income tax expense in the period the release is recorded. However, the timing and amount of the valuation allowance requirements following a transferrelease, if any, are unknown as this is subject to change on the basis of intellectual propertythe level of profitability that occurred during 2021. Seewe are able to actually achieve in future periods and other evidence that will be considered at the time of the assessment. Refer to Note 2223 to theour consolidated financial statements for additional information on our income tax expense.

Constant currency revenue growth represents the change in revenue between current and prior year periods using the exchange rate in effect during the applicable prior year period. We present constant currency revenue growth because we believe it provides meaningful information regarding our results on a consistent and comparable basis. Management uses this non-GAAP financial measure, in addition to financial measures in accordance with GAAP, to evaluate our operating results. It is also one of the performance metrics that determines management incentive compensation.

Adjusted EBITDA represents net income (loss) plus net interest expense, income tax expense, (benefit), depreciation and amortization, stock-based compensation expense and other significant unusual items,transactions or events, such as legal settlements, medical device corrections, gains (losses) on investments, and loss on extinguishment of debt, which affect the period-to-period comparability of our operating performances, as applicable. We present Adjusted EBITDA because management uses it as a supplemental measure in assessing our operating performance, and we believe that it is helpful

These non-GAAP financial measures should be considered supplemental to, and not a substitute for, our reported financial results prepared in accordance with GAAP. In addition, the above definitions may differ from similarly titled measures used by others. Non-GAAP financial measures exclude the effect of items that increase or decrease our reported results of operations; accordingly, we strongly encourage investors to review our consolidated financial statements in their entirety.

Additional information regarding our debt is provided in Note 15Notes 16 and 26 to the consolidated financial statements.