Unless the context requires otherwise, references to LeMaitre, LeMaitre Vascular, we, our, and us refer to LeMaitre Vascular, Inc. and our subsidiaries. We develop, manufacture, and market medical devices and implants used primarily in the field of vascular surgery. We also derive revenues from the processing and cryopreservation of human tissues for implantation in patients. We operate in a single segment in which our principal product lines include the following: ~~valvulotomes,~~anastomotic clips, biologic vascular and dialysis grafts, biologic vascular and cardiac patches, ~~balloon catheters,~~ carotid shunts, ~~biologic vascular grafts, anastomotic clips,~~embolectomy catheters, occlusion catheters, radiopaque marking tape, synthetic vascular grafts, ~~remote endarterectomy devices, laparoscopic cholecystectomy devices, angioscopes,~~ and ~~powered phlebectomy devices.~~valvulotomes. Our offices and production facilities are located in Burlington, Massachusetts; Fox River Grove, Illinois; ~~Mississauga,~~North Brunswick, New Jersey; Chandler, Arizona; Vaughan, Canada; Sulzbach, Germany; Milan, Italy; Madrid, Spain; ~~North Melbourne,~~Hereford, England; Dublin, Ireland; Kensington, Australia; Tokyo, Japan; Shanghai, China; Singapore; Seoul, Korea; and ~~Shanghai, China.~~Bangkok, Thailand.

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information and with the instructions to Form10-Q and Article 10 of RegulationS-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments, consisting only of normal, recurring adjustments considered necessary for a fair presentation of the results of these interim periods have been included. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. Actual results may differ from these estimates. Our estimates and assumptions, including those related to bad debts, inventories, intangible assets, sales returns and discounts, share-based compensation, and income taxes are updated as appropriate. The results for the nine months ended September 30, ~~2017~~2023 are not necessarily indicative of results to be expected for the entire year. The information contained in these interim financial statements should be read in conjunction with our audited consolidated financial statements as of and for the year ended December 31, ~~2016,~~2022, including the notes thereto, included in our Form10-K filed with the Securities and Exchange Commission (SEC) on March ~~9, 2017.~~1, 2023.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited consolidated financial statements and accompanying notes. The Company is not aware of any specific event or circumstance that would require an update to its accounting estimates or adjustments to the carrying value of its assets and liabilities as of November 7, 2023, the issuance date of this Quarterly Report on Form 10-Q. Actual results could differ from those estimates.

Our consolidated financial statements include the accounts of LeMaitre Vascular and the accounts of our wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

Our revenue is derived primarily from the ~~Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (ASU)2017-09~~ ~~which provides guidance~~sale of disposable or implantable devices used during vascular surgery. We sell primarily direct to hospitals and to a lesser extent to international distributors, as described below, and, during the periods presented in our consolidated financial statements, entered into consigned inventory arrangements with either hospitals or distributors on ~~determining which changes~~a limited basis. We also derive revenues from the processing and cryopreservation of human tissues for implantation in patients. These revenues are recognized when services have been provided and the tissue has been shipped to the ~~terms and conditions~~customer, provided all other revenue recognition criteria discussed in the succeeding paragraph have been met.

We record revenue under the provisions of share-based payment awards require an entity to apply modification accounting under ASC 718, Compensation – Stock Compensation. The new standard is effective for us beginning January 1, 2018, with early adoption permitted. The adoption of this standard is not expected to have a material impact on our financial statements.

~~In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (ASU)2017-04,~~ which, among other provisions, eliminates “step 2” from the goodwill impairment test. The annual, or interim, goodwill impairment test will be performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The new standard is effective for us beginning January 1, 2020, with early adoption permitted. The adoption of this standard is not expected to have a material impact on our financial statements.

~~In January 2017, the FASB issued~~ ASU~~2017-01~~ which changes the definition of a business for purposes of determining whether a business has been acquired or sold. The amendment is intended to help companies evaluate whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The new standard is effective for us beginning January 1, 2018, with early adoption permitted. The adoption of this standard is not expected to have a material impact on our financial statements.

~~In August 2016, the FASB issued ASU2016-15,~~ which changes the classification of certain cash receipts and cash payments within the statement of cash flows. The new standard is effective for us beginning January 1, 2018, with early adoption permitted. The adoption of this standard is not expected to have a material impact on our financial statements.

~~In May 2014, the FASB and the International Accounting Standards Board issued substantially converged final standards on revenue recognition. The FASB’s ASUNo.~~ 2014-09,Revenue from Contracts with Customers (Topic 606). The core principle of Topic 606 is that an entity should recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard explains that to achieve the core principle, an entity should take the following actions:

Step 5: Recognize revenue when or as the entity satisfies a performance obligation

Revenue is recognized when or as a company satisfies a performance obligation by transferring a promised good or service to a customer (which is when the customer obtains control of that good or service). In instances in which shipping and handling activities are performed after a customer takes control of the goods (such as when title passes upon shipment from our dock), we have made the policy election allowed under Topic 606 to account for these activities as ~~amended~~fulfillment costs and not as performance obligations.

We generally reference customer purchase orders to determine the existence of a contract. Orders that are not accompanied by a purchase order are confirmed with the customer either in writing or verbally. The purchase orders or similar correspondence, once accepted, identify the performance obligations as well as the transaction price, and otherwise outline the rights and obligations of each party. We allocate the transaction price of each contract among the performance obligations in accordance with the pricing of each item specified on the purchase order, which is in turn based on standalone selling prices per our published price lists. In cases where we discount products or provide certain items free of charge, we allocate the discount proportionately to all performance obligations, unless it can be demonstrated that the discount should be allocated entirely to one or more, but not all, of the performance obligations.

We record revenue, net of allowances for returns and discounts, fees paid to group purchasing organizations, and any sales and value added taxes required to be invoiced, which we have elected to exclude from the measurement of the transaction price as allowed by the standard, at the time of shipment (taking into consideration contractual shipping terms), or in the case of consigned inventory, when it is consumed. Shipment is the point at which control of the product and title passes to our customers, and at which LeMaitre has a present right to receive payment for the goods.

Below is a disaggregation of our revenue by major geographic area, which is among the primary categorizations used by management in evaluating financial performance, for the periods indicated (in thousands):

We do not carry any contract assets or contract liabilities, as there are generally no unbilled amounts due from customers under contracts for which we have partially satisfied performance obligations, or amounts received from customers for which we have not satisfied performance obligations. We satisfy our performance obligations under revenue contracts within a very short time period from receipt of the orders, and payments from customers are typically received within 30 to 60 days of fulfillment of the orders, except in certain geographies such as Italy, Spain and France where the payment cycle is customarily longer. Accordingly, there is no significant financing component to our revenue contracts. Additionally, we have elected as a policy that incremental costs (such as commissions) incurred to obtain contracts are expensed as incurred, due to the short-term nature of the contracts.

Customers returning products may be entitled to full or partial credit based on the condition and timing of the return. To be accepted, a returned product must be unopened (if sterile), unadulterated, and undamaged, must have at least 18 months remaining prior to its expiration date, or twelve months for our hospital customers in Europe, and generally be returned within 30 days of shipment. These return policies apply to sales to both hospitals and distributors. The amount of products returned to us, either for exchange or credit, has not been material. Nevertheless, we provide for an allowance for future sales returns based on historical returns experience, which requires judgment. Our cost of replacing defective products has not been material and is accounted for at the time of replacement.

From time to time, ~~outlines a single comprehensive model for entities to use in~~new accounting ~~for revenue arising from contracts with customers~~pronouncements are issued by the Financial Accounting Standards Board (FASB) or other standard setting bodies and supersedes most current revenue recognition guidance, including industry-specific guidance. The new revenue recognition guidance becomes effective for us on January 1, 2018, with early adoption permitted on January 1, 2017. Entities haveare generally adopted by the ~~option of using either a full retrospective or a modified approach to adopt the guidance in the ASU. Our assessment~~Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact ~~to our financial statements~~ of adopting this standard is underway. We engaged external consultants to assist us with our analysis, which included evaluating our standard arrangements with customers, as well as arrangements specific to certain customer bases or product offerings, and reviewing a sample of actual contracts to determine whether thererecently issued standards that are ~~additional attributes to consider beyond our standard arrangements. Although our assessment is~~ not ~~complete, we do~~yet effective will not ~~currently expect that adoption of Topic 606 will~~ have a material impact on ~~our consolidated~~its financial statements. However, there will likely be changes to our revenue recognition accounting policy as well as other disclosures. Additionally, we have preliminarily determined that we will use the modified retrospective methodposition or results of operations upon adoption.

As part of the process of preparing our consolidated financial statements we are required to determine our income taxes in each of the jurisdictions in which we operate. This process involves estimating our actual current tax expense together with assessing temporary differences resulting from recognition of items for income tax and accounting purposes. These differences result in deferred tax assets and liabilities, which are included within our consolidated balance sheet. We must then assess the likelihood that our deferred tax assets will be recovered from taxable income during the carryback period or in the future; and to the extent we believe that recovery is not more likely than not, we must establish a valuation allowance. To the extent we establish a valuation allowance or increase this allowance in a period, we must reflect this increase as an expense within the tax provision in the statement of operations. We do not provide for income taxes on undistributed earnings of certain foreign subsidiaries, as our intention is to permanently reinvest these earnings.

We recognize, measure, present and disclose in our financial statements any uncertain tax positions that we have taken, or expect to take on a tax return. We operate in multiple taxing jurisdictions, both ~~within~~inside and ~~without~~outside the United States, and may be subject to audits from various tax authorities. Management’s judgment is required in determining our provision for income taxes, our deferred tax assets and liabilities, liabilities for uncertain tax positions, and any valuation allowance recorded against our net deferred tax assets. We will monitor the realizability of our deferred tax assets and adjust the valuation allowance accordingly.

Our policy is to classify interest and penalties related to unrecognized tax benefits as income tax expense.

Our ~~2017~~2023 income tax expense varies from the statutory rate mainly due to the generation of federal and state tax credits, permanent items, ~~and lower~~different statutory rates from our foreign ~~subsidiaries. Additionally, in the second~~subsidiaries, and ~~third quarters of 2017, we recognized certain~~ discrete ~~items primarily related to the exercise of~~ stock ~~options.~~option exercises. Our ~~2016~~2022 income tax expense varied from the statutory rate mainly due to ~~certain~~the generation of federal and state tax credits, permanent items, ~~offset by lower~~different statutory rates from our foreign ~~entities~~subsidiaries, and a discrete ~~item for~~ stock option exercises.

We have reviewed the tax positions taken, or to be taken, in our tax returns for all tax years currently open to examination by a taxing authority. As of September 30, ~~2017,~~2023, the gross amount of unrecognized tax benefits exclusive of interest and penalties was ~~$451,000.~~$569,000. We remain subject to examination until the statute of limitations expires for each remaining respective tax jurisdiction. The statute of limitations will be open with respect to these tax positions until ~~2025.~~2030. A reconciliation of beginning and ending amount of our unrecognized tax benefits is as follows:

As of September 30, ~~2017,~~2023, a summary of the tax years that remain subject to examination in our taxing jurisdictions is as follows:

We had inventory on consignment at customer sites of ~~$1.3~~$1.8 million and ~~$1.1~~$1.5 million at September 30, ~~2017~~2023 and December 31, ~~2016,~~2022, respectively.

In connection with our ~~recent acquisition of the~~ RestoreFlow allograft business, other deferred costs include costs incurred for the preservation of human ~~vascular tissue~~tissues available for shipment, ~~tissue~~tissues currently in active processing, and ~~tissue~~tissues held in quarantine pending release to implantable status. By federal law, human ~~tissue~~tissues cannot be bought or sold. Therefore, the tissues we preserve are not held as inventory, and the costs we incur to procure and process vascular ~~tissue are instead accumulated~~ and ~~deferred.~~

Our strategy for growing our business includes the acquisition of complementary product lines and businesses. Our acquisitions, including those discussed below, have historically been made at prices above the fair value of the acquired identifiable assets, resulting in goodwill, due to expectations of synergies that will be realized by combining businesses. These synergies include the use of our existing sales channel to expand sales of the acquired businesses’ products and services, consolidation of manufacturing facilities, and the leveraging of our existing administrative infrastructure.

The fair market valuations associated with these transactions fall within Level 3 of the fair value hierarchy, due to the use of significant unobservable inputs to determine fair value. The fair value measurements were calculated using unobservable inputs, primarily using the income approach, specifically the discounted cash flow method. The amount and timing of future cash flows within our analysis was based on our due diligence models, most recent operational budgets, long range strategic plans and other estimates.

On November 10, 2016, we entered into an agreement to acquire the assets of Restore Flow Allografts, LLC, a provider of human vascular tissue processing and cryopreservation services, for an initial purchase price of $12 million, with additional payments of up to $6 million, depending upon the satisfaction of certain contingencies. A payment of $2 million is due not later than 15 days following the expiration of the 18 month period following the closing date, subject to reductions as specified in the agreement for each calendar month that certain retained employees are not employed by us due to resignation without good reason, or termination for cause, both as defined in the agreement. The portion of this payment that will be paid to retained employees and that is contingent on their continuing employment, approximately $0.9 million, is being accounted for as post-combination compensation expense rather than purchase consideration. There are also two potential earn-outs under the agreement. The first~~earn-out~~ ~~is calculated at 50% of the amount by which net revenue in the first 12 months following the closing exceeds $6 million, with such payout not to exceed $2 million. The secondearn-out~~ ~~is calculated at 50% of the amount by which net revenue in the second 12 months following the closing exceeds $9 million, with such payout not to exceed $2 million.~~

The RestoreFlow business derives revenue from human tissue preservation services, in particular the processing and cryopreservation of veins and arteries. By federal law, human tissues cannot be bought or sold. Therefore, the tissues we obtain and preserve are not held as inventory, and the costs we incur to procure and process vascularcardiac tissues are instead accumulated and deferred. ~~Revenues are recognized for~~These costs include fixed and variable overhead costs associated with the cryopreservation process, including primarily direct labor costs, tissue recovery fees, inbound freight charges, indirect materials and facilities costs. General and administrative expenses and selling expenses associated with the provision of ~~cryopreservation~~these services ~~rather than product sales.~~are expensed as incurred.

On April 26, 2022, we committed to a plan to close our St. Etienne, France factory, which supported our LeMaitre Cardial SAS (Cardial) business, in order to streamline manufacturing operations and reduce expenses. The Cardial business consisted of the manufacture of polyester vascular grafts, valvulotomes, surgical glue and selected OEM devices. We acquired assets included intellectual property, permits and approvals, data and records, equipment and furnishings, accounts receivable, inventory, literature, and customer and supplier information. We also assumed certain accounts payable. We accountedthe Cardial business in 2018.

On June 30, 2022, we ceased operations at the St. Etienne, France factory. The closure resulted in a restructuring charge of $3.1 million for the ~~acquisition as a business combination.~~

~~The following table summarizes the preliminary purchase price allocation as~~year ended December 31, 2022. Charges primarily consisted of ~~September 30, 2017:~~employment termination costs, impairment of fixed assets and inventory, and third-party costs.

~~The goodwill is deductible~~On October 10, 2022, we sold the St. Etienne, France building, building improvements, and land for ~~tax purposes over 15 years.~~

~~The following table reflects~~$0.9 million less closing costs of $0.1 million, resulting in a gain of approximately $0.1 million recorded for the ~~preliminary allocation of the acquired intangible assets and related estimated useful lives:~~year ended December 31, 2022.

~~The weighted-average amortization period of the acquired intangible assets was 10.3 years.~~

On March 18, 2016, we acquired the ProCol biologic vascular graft (“ProCol”) business for $2.7 million from Hancock Jaffe Laboratories, Inc. (HJL) and CryoLife, Inc. (CRY). HJL was the owner and manufacturer of ProCol and CRY was the exclusive distributor of the ProCol graft. CRY also owned an option to purchase the ProCol business, which we acquired from CRY. We bought finished goods inventory and other ProCol related assets from CRY for $2.0 million, which was paid in full at closing. We bought other ProCol assets from HJL for $0.7 million, 50% of which was paid at closing, 25% of which was paid in the quarter ended September 30, 2016 and the remaining 25% of which was paid in the quarter ended March 31, 2017. Additional consideration is payable to HJL for a three-year period following the closing, calculated at 10% of ProCol revenues. This additional consideration was initially valued at $0.3 million and will be~~re-measured~~ ~~each reporting period until the payment requirement ends, with any adjustments reported in income from operations. For~~During the nine months ended September 30, ~~2017,~~2023, we recorded additional restructuring charges of $0.5 million in conjunction with the ~~amount~~St. Etienne, France factory closure. The additional charges consisted primarily of ~~the adjustment was not material to our financial statements.~~

~~Assets acquired included inventory, intellectual property~~employment termination, settlement, legal and ~~a related license, the ProCol trade name, customer lists,non-compete~~ ~~agreements and certain equipment and supplies. We did not assume any liabilities. We accounted for the acquisition as a business combination. The purchase accounting is complete.~~

~~The following table summarizes the purchase price allocation as of the acquisition date:~~other third-party costs.

~~The weighted-average amortization period of the acquired intangible assets was 8.6 years.~~

~~In May 2015, we entered into an asset purchase agreement with UreSil, LLC (UreSil) to acquire the production and distribution rights of UreSil’sTru-Incise~~ valvulotome for sales outside the United States for a purchase price of approximately $1.4 million. We paid $1.1 million at the closing with the remaining $0.3 million paid at various points in 2016 and 2017. We accounted for the acquisition as a business combination. Assets acquired included inventory and intellectual property. We did not assume any liabilities. The purchase accounting is complete.

~~The following table summarizes the purchase price allocation at the date of the acquisition:~~

~~The following table reflects the allocation of the acquired intangible assets and related estimated useful lives:~~

There was no change to goodwill during the ~~following as of~~nine months ended September 30, ~~2017:~~

These ~~intangible~~ assets are being amortized over ~~their~~ useful lives ranging from 12 to 1316 years. The weighted-average amortization period for these intangibles as of September 30, ~~2017~~2023 is ~~9.1~~10.3 years. Amortization expense is included in general and administrative expense and was as follows for the periods indicated.

We estimate that amortization expense for the remainder of 2023 and for each of the five succeeding fiscal years will be as follows:

The Company determines if an arrangement is a lease at inception of the contract. The Company has operating leases for buildings, primarily for office space, manufacturing and distribution, as well as automobiles and printing equipment. At September 30, 2023, the Company has the following building and facility leases capitalized on the balance sheet:

Operating lease right-of-use (“ROU”) assets and operating lease liabilities are recognized based on the present value of the future lease minimum payments over the lease term at commencement date. Many of the lease agreements contain renewal or termination clauses that are factored into the determination of the lease term if it is reasonably certain that these options would be exercised. The Company recognizes lease expense for these leases on a straight-line basis over the lease term.

None of our noncancelable lease payments include non-lease components such as maintenance contracts; we generally reimburse the landlord for direct operating costs associated with the leased space. We have no subleases, and there are no residual value guarantees associated with, or restrictive covenants imposed by, any of our leases. There were no assets held under capital leases at September 30, 2023.

The interest rate implicit in lease agreements is typically not readily determinable, and as such the Company used the incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The incremental borrowing rate is defined as the interest the Company would pay to borrow on a collateralized basis.

6.	~~Accrued Expenses and Other Long-term Liabilities~~

The maturities of the lease liabilities for each of the following fiscal years is:

~~Under Accounting Standards Codification Topic 280,~~8. Segment ~~Reporting~~,and Enterprise-Wide Disclosures

The FASB establishes standards for reporting information regarding operating segments in financial statements. Operating segments are ~~defined~~identified as components of an enterprise that engage in business activities for which separate, discrete financial information is available and ~~evaluated~~is regularly reviewed by the chief operating decision-maker in making decisions on how to allocate resources and assess performance. We view our operations and manage our business as one operating segment. No discrete operating information is prepared by us except for sales by product line and operations by legal entity for local ~~reporting~~ purposes.

Most of our revenues are generated in the United States, Germany, the United Kingdom and other European countries ~~as well as in Canada, Japan~~ and ~~China.~~Canada. Substantially all of our assets are located in the United ~~States.~~States and Germany. Net sales to unaffiliated customers by country were as follows:

Our Third Amended and Restated 2006 Stock Option and Incentive Plan allows for granting of incentive stock options,non-qualified stock options, stock appreciation rights, restricted stock units, performance-based restricted stock units, unrestricted stock awards, and deferred stock awards to our officers, employees, directors and consultants.

Stock-based compensation is included in our statements of operations as follows:

Included in stock-based compensation expense for the three and nine months ended September 30, 2017 is a stock option modification charge of $0.5 million for awards that are being allowed to continue to vest for approximately one year beyond the requisite service period associated with the recent departure of our President of International Operations. This expense is included in the caption “General and administrative” above.

~~Options granted during the nine months ended September 30, 2017 were not material.~~ During the nine months ended September 30, ~~2016,~~2023 and 2022, we granted options tofor the purchase ~~511,000~~of 1,660 and 2,052 shares of our common stock, ~~to employees andnon-employee~~ directors. We computed the weighted average fair values of employee stock options for option grants issued during the nine months ended September 30, 2016 using the Black-Scholes option model with the following assumptions:

~~Restricted stock awards during the nine months ended September 30, 2017 were not material. During the nine months ended September 30, 2016~~ we ~~awarded~~granted restricted stock units of ~~126,000 to employees. The weighted-average fair value per share of~~944 and 728, and granted performance-based restricted stock ~~unit awards issued for the nine months ended September 30, 2016 was $14.11.~~

units of 310 and 250, respectively. We issued approximately ~~702,000~~180,000 and ~~285,000~~81,000 shares of common stock following the exercise or vesting of underlying stock options or restricted stock units induring the nine months ended September 30, ~~2017~~2023 and ~~2016,~~2022, respectively.

On ~~July 25, 2016,~~February 21, 2023, our Board of Directors ~~approved a stock~~authorized the repurchase ~~program under which the Company was authorized to repurchase~~of up to $5$25.0 million of ~~its~~the Company’s common stock through transactions on the open market, in privately negotiated purchases or ~~otherwise. This program expired on July 25, 2017. We did not make any repurchases under this program prior to its expiration.~~

~~On July 25, 2017, our Board of Directors approved a stock~~otherwise until February 21, 2024. The repurchase ~~program under which the Company is authorized to repurchase up to $7.5 million of its common stock through transactions on the open market, in privately negotiated purchases or otherwise. This~~ program may be suspended or discontinued at any ~~time, and expires on the earlier of July 25, 2018 or when the $7.5 million repurchase limit is reached, unless extended by our Board of Directors.~~time. To date we have not made any repurchases under this program.

In February 2011, our Board of Directors approved a policy for the payment of quarterly cash dividends on our common stock. Future declarations of quarterly dividends and the establishment of future record and payment dates are subject to approval by our Board of Directors on a quarterly basis. The dividend activity for the periods presented is as follows:

On October 24, ~~2017~~2023, our Board of Directors approved a quarterly cash dividend on our common stock of ~~$0.055~~$0.14 per share payable on ~~December 7, 2017~~November 30, 2023, to stockholders of record at the close of business on November ~~22, 2017, which will total approximately $1.1 million.~~16, 2023.

The fair value accounting guidance requires that assets and liabilities carried at fair value be classified and disclosed in one of the following three categories:

•

Level 1 — Quoted prices in active markets for identical assets or liabilities.

•

Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

•

Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

Level 1 ~~— Quoted prices in active markets for identical~~ assets ~~or liabilities.~~

~~Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the~~being measured at fair value ~~of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.~~

Ason a recurring basis as of September 30, ~~2017, we had cash equivalents in a money market~~2023 included our short-term investment and short-duration bond mutual fund ~~that was valued using Level 1 inputs (quoted market prices for identical assets) at a fair value of $19.0 million.~~accounts.

We had no Level 2 assets being measured at fair value on a recurring basis as of September 30, ~~2017.~~2023.

Several of our ~~acquired businesses. These~~acquisition-related assets and liabilities ~~are or~~ have been ~~remeasured each reporting period~~measured using Level 3 ~~techniques to assess~~techniques. During 2020 we recorded a contingent liability associated with our acquisition of the ~~probability that we will be~~bovine carotid graft business from Artegraft. The agreement required us to make ~~future~~potential additional payments ~~and~~ to Artegraft of up to $17.5 million depending on the achievement of certain unit sales milestones during the first three calendar years following the acquisition. We recorded this liability at a fair value of $0.4 million to reflect management’s estimate of the likelihood of achieving these targets at the time of the Closing, as well as the time value of money until payment. This amount is being remeasured each quarter during the earn-out period, with any adjustments recorded in income from operations. During the quarter ended December 31, 2022 we recorded a reduction to the liability to reflect a change in our estimate of ~~those payments. During~~the likelihood of achieving the unit sales milestones. There was no additional change in the estimated liability during the nine months ended September 30, ~~2017~~2023.

During 2019, we ~~made fair-value adjustments to our~~recorded contingent liabilities associated with our acquisition of ~~$0.6 million.~~the Anteris (formerly Admedus) biologic patch business. The agreement includes the potential for us to pay up to $7.8 million of additional consideration beyond payments made to date, with $0.3 million contingent upon the delivery of audited financial statement of the acquired business to us; $2.0 million (“CE Mark Contingency”) contingent on LeMaitre’s success in obtaining CE marks under MDR regulations on the acquired products; $0.5 million contingent upon Anteris’ success in extending the shelf life of the acquired products as specified in the agreement; and another $5.0 million contingent on the achievement of specified levels of revenues in the first 12 and 24 months following the acquisition date. This additional contingent consideration was initially valued in total at $2.3 million and is being re-measured each reporting period until the payment requirement ends, with any adjustments reported in income from operations. The contingent payment related to the delivery of audited financial statements of the business was paid in November 2019 upon satisfaction of the deliverable. The contingent payments related to Anteris’ extending the shelf life of the acquired products and achieving the revenue targets during the first 12 and 24 month periods following the acquisition were not met, and the portion of the liabilities related to these items was adjusted through income from operations. The agreement was amended in August 2021 such that the CE Mark Contingency amount may be reduced for certain costs incurred by LeMaitre in achieving the CE marks. During the quarter ended September 30, 2021 we recorded a reduction to the liability of $0.5 million, with the offset recorded in income from operations, to reflect our estimate of costs to be deducted from the contingent payment in connection with this amendment. Additionally, during the quarter ended December 31, 2022 we recorded a reduction to the liability of approximately $0.1 million, with the offset recorded in income from operations.

In September 2023 the agreement was amended in order to (i) place a cap on the total amount of costs incurred by LeMaitre in achieving the CE marks under MDR regulations that could be used as a deduction toward the $2.0 million holdback, and (ii) require a prorata payment to Anteris of the CE Mark Contingency, less costs described above, by January 2025 if the CE marks are not obtained by that date. During the quarter ended September 30, 2023 we recorded a reduction to the liability of $0.1 million, with the offset recorded in income from operations.

The following table provides a roll-forward of the fair value of these liabilities, as determined by Level 3 unobservable inputs including management’s forecast of future revenues for the acquired businesses, as well as, management’s estimates of the likelihood of achieving the other specified criteria:

Changes to our accumulated other comprehensive loss ~~consisted of foreign currency translation~~ for the nine months ended September 30, ~~2017~~2023 and ~~2016.~~

~~Item 2.~~

~~Management’s Discussion and Analysis of Financial Condition and Results of Operations~~

In October 2023, we amended our lease agreements related to four of our five buildings in Burlington, Massachusetts, extending them for a period of four additional years to December 31, 2034. The Company has no option to extend or renew the leases beyond December 31, 2034. As of September 30, 2023, the expiration date was December 31, 2030. The foregoing description of the Amendments is not complete and is qualified in its entirety by reference to the full text of such documents attached as exhibits hereto.

Item2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Quarterly Report on Form10-Q contains forward-looking statements (within the meaning of the ~~federal securities law)~~U.S. Private Securities Litigation Reform Act of 1995) that involve substantial risks and ~~uncertainties.~~uncertainties, particularly risks related to the regulatory environment, our common stock, fluctuations in our quarterly and annual results, our ability to successfully integrate acquisitions into our business, and risks related to our business and industry generally, such as risks inherent in the process of developing and commercializing products and services that are safe and effective for use in the peripheral vascular disease market. All statements, other than statements of historical facts, included in this report regarding our strategy, future operations, future financial position, future net sales, gross margin expectations, projected costs, projected expenses, prospects and plans and objectives of management are forward-looking statements. The words ~~“anticipates,~~“anticipates,” ~~“believes,~~“believes,” ~~“estimates,~~“estimates,” ~~“expects,~~“expects,” ~~“intends,~~“intends,” ~~“may,~~“may,” ~~“plans,~~“plans,” ~~“projects,~~“projects,” ~~“will,~~“will,” ~~“would,~~“would,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We have based these forward-looking statements on our current expectations and projections about future events. Although we believe that the expectations underlying any of our forward-looking statements are reasonable, these expectations may prove to be incorrect, and all of these statements are subject to risks and uncertainties. Should one or more of these risks and uncertainties materialize, or should underlying assumptions, projections, or expectations prove incorrect, our actual results, performance, or financial condition may vary materially and adversely from those anticipated, estimated, or expected. No forward-looking statement can be guaranteed and actual results may vary materially from those projected in the forward-looking statements. We intend to take advantage of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995 regarding our forward-looking statements, and are including this sentence for the express purpose of enabling us to use the protections of the safe harbor with respect to all forward-looking statements.These risks and uncertainties include, but are not limited to:the risk of significant fluctuations in our quarterly and annual results due to numerous factors; the risk that assumptions about the market for the Company’s products and the productivity of the Company’s direct sales force and distributors may not be correct; the risk that we may not be able to maintain our recent levels of profitability; the status of our global regulatory approvals and compliance with regulatory requirements to market and sell our products both in the US and outside of the US; the risk that the Company may not realize the anticipated benefits of its strategic activities; risks related to the integration of acquisition targets; the ~~risk that assumptions about the market for the Company’s products and the productivity~~acceleration or deceleration of ~~the Company’s direct sales force and distributors may not be correct;~~product growth rates; risks related to product demand and market acceptance of the ~~Company’s products; risks associated with~~Company’s products and pricing; the risk that a recall of our ~~newly acquired tissue processing and preservation operations and the related services we now provide; risks related to attracting, training and retaining sales representatives and other employees~~products could result in ~~new markets; adverse~~significant costs or ~~fluctuating conditions in the general domestic and global economic markets; and~~negative publicity; the risk that the Company is not successful in transitioning to a direct-selling model in new territories.

Forward-looking statements reflect ~~management’s~~management’s analysis as of the date of this quarterly report. Further information on potential risk factors that could affect our business and financial results is detailed in Part II, Item 1A, ~~“Risk Factors”~~“Risk Factors” in this Quarterly Report on Form10-Q and in our other filings with the Securities and Exchange Commission, including under the section headed ~~“Risk Factors”~~“Risk Factors” in our most recent Annual Report on Form10-K. Given these risks, uncertainties and other factors, you should not place undue reliance on these forward-looking statements. The following discussion and analysis should be read in conjunction with our consolidated financial statements and the related notes included in this report and our other SEC filings, including our audited consolidated financial statements and the related notes contained in our Annual Report on Form10-K for the year ended December31, ~~2016,~~2022, as filed with the SEC on March ~~8, 2017.~~1, 2023. We do not assume any obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.

Unless the context indicates otherwise, references to ~~“LeMaitre~~“LeMaitre Vascular,”“we,” ~~“we,~~“LeMaitre,” ~~“our,~~“our,” and ~~“us”~~“us” in this Quarterly Report on Form10-Q refer to LeMaitre Vascular, Inc. and its subsidiaries.

LeMaitre, AlboGraft, AnastoClip, ~~Omniflow,~~AnastoClip GC, Artegraft, Cardial, CardioCel, Dialine, Eze-Sit, Glow ‘N Tell, LeverEdge, LifeSpan, ProCol, Pruitt, Pruitt F3, Pruitt-Inahara, RestoreFlow, TufTex, VascuCel, VascuTape, Wovex and XenoSure are registered trademarks of LeMaitre Vascular or one of its ~~subsidiaries.~~subsidiaries, and Chevalier, DuraSure, Flexcel, Omniflow, PeriVu and Syntel are trademarks of LeMaitre Vascular. This Quarterly Report on Form10-Q also includes the registered and unregistered trademarks of other persons, which are the property of their respective owners.

LeMaitre Vascular is a ~~medical device company that develops, manufactures, and markets~~global provider of medical devices and ~~implants for~~human tissue cryopreservation services largely used in the treatment of peripheral vascular disease, end-stage renal disease, and to a lesser extent cardiovascular disease. We ~~also provide processing~~develop, manufacture, and ~~cryopreservation services~~market vascular devices to address the needs of ~~human tissue for implantation into patients.~~vascular surgeons and, to a lesser degree, other specialties such as cardiac surgeons, general surgeons and neurosurgeons. Our diversified portfolio of devices consists of brand name products that are used in arteries and veins and are well known to vascular surgeons. Our principal product offerings are sold ~~throughout the world,~~globally, primarily in ~~North America,~~the United States, Europe, Canada and ~~to a lesser extent,~~ Asia ~~and the Pacific Rim.~~Pacific. We estimate that the annual worldwide market for ~~all~~ peripheral vascular devices ~~approximates~~exceeds $5 billion, within which we estimate that the market for our ~~product lines address roughly $870~~products is approximately $750 million. We have grown our business by using a simple three-pronged strategy: 1) pursuing a focused call point, 2) competing for sales oflow-rivalry, niche products, and 3) expanding our worldwide direct sales force while acquiring ~~and developing~~ complementary ~~vascular~~ devices. We have used acquisitions as a primary means of further ~~accessing~~penetrating the ~~larger~~ peripheral vascular device market, and we expect to ~~pursue~~continue this strategy in the future. ~~Additionally, we have continued our efforts to expand our vascular device offerings through research and development.~~ We currently manufacture most of our ~~product lines at~~products in our Burlington, Massachusetts headquarters.

Our products and services are used primarily by vascular surgeons who treat peripheral vascular disease through both open surgical methods and endovascular techniques. In contrast to interventional cardiologists and interventional radiologists, ~~neither of whom are certified to perform open surgical procedures,~~ vascular surgeons can perform both open surgical and minimally invasive endovascular procedures, and ~~are~~ therefore ~~uniquely positioned to~~can provide a wider range of treatment ~~options.~~options to their patients. More recently, however, we have begun to explore adjacent market customers, or non-vascular surgeon customers, who can be served by our vascular device technologies, such as cardiac surgeons and neurosurgeons.

Our principal product lines include the following: anastomotic clips, ~~angioscopes, balloon catheters,~~ biologic vascular and dialysis grafts, biologic vascular and cardiac patches, carotid shunts, ~~laparoscopic cholecystectomy devices, powered phlebectomy devices,~~embolectomy catheters, occlusion catheters, radiopaque marking tape, ~~remote endarterectomy devices,~~ synthetic vascular and dialysis grafts, and valvulotomes. ~~With the November 10, 2016 acquisition of the~~Through our RestoreFlow allografts business, we also provide services related to the processing and cryopreservation of human vascular and cardiac tissue.

Our principal biologic offerings include vascular and cardiac patches as well as vascular and dialysis grafts. In Q3 2023, biologics represented 51% of our worldwide sales. We view our biologic device offerings favorably, as we believe they represent differentiated and in many cases growing product segments.

To assist us in evaluating our business strategies, we regularly monitor long-term technology trends in the peripheral vascular device market. Additionally, we consider the information obtained from discussions with the medical community in connection with the demand for our products, including potential new product launches. We also use this information to help determine our competitive position in the peripheral vascular device market and our manufacturing capacity requirements.

~~the long-term growth of our direct sales force in North America, Europe, Asia and the Pacific Rim;~~

~~the addition of complementary products through acquisitions;~~

~~the updating of existing products and introduction of new products through research and development;~~

~~the introduction of our products in new territories upon receipt of regulatory approvals or registrations in these territories; and~~

~~the consolidation of, and automation of, product manufacturing at our facilities in our Burlington, Massachusetts corporate headquarters.~~

We sell our products and services primarily through a direct sales force. As of September 30, ~~2017~~2023, our sales force was comprised of 89136 sales representatives in North America, Europe ~~Japan, China~~ and ~~Australia.~~Asia Pacific, including three export managers. Our worldwide headquarters is located in Burlington, Massachusetts, and we also have North American sales offices in Chandler, Arizona and Vaughan, Canada. Our European headquarters is located in Sulzbach, Germany, and we also have sales offices in Milan, Italy; Madrid, Spain; Hereford, England; and Dublin, Ireland. Our Asia Pacific headquarters is located in Singapore, and we also have sales offices in Tokyo, Japan; Shanghai, China; Kensington, Australia; Seoul, Korea; and Bangkok, Thailand. During the current quarter, approximately 95% of our net sales were generated in countries in which we employ direct sales representatives. We also sell our products in other countries through distributors. Our worldwide headquarters is located in Burlington, Massachusetts. Our international operations are headquartered in Sulzbach, Germany. We also have sales offices located in Tokyo, Japan; Mississauga, Canada; Madrid, Spain; Milan, Italy; Shanghai, China; and North Melbourne, Australia, and we have processing facilities in Fox River Grove, Illinois and North Melbourne, Australia. During the nine month periods ended September 30, 2017 and 2016, approximately 93% and 92%, respectively, of our net sales were generated in territories in which we employ direct sales representatives.

Historically we have experienced success in lower-rivalry niche product segments, for example the market segments for biologic vascular patches and valvulotomes. In the biologic vascular patch market the number of competitors is limited, and we believe that we have been able to increase segment share and increase selling prices, mainly due to the strength of our sales force.segments. In the valvulotome market, wefor example, our highly differentiated devices have ~~been able~~historically allowed us to increase our selling prices while maintaining ~~our~~ unit ~~market~~ share. In contrast, we have experienced less success in highly competitive markets such as ~~laparoscopic cholecystectomy catheters and synthetic grafts,~~the polyester vascular graft market, where we face ~~stronger~~ competition from larger companies with greater resources and lower ~~production~~per unit costs. While we believe ~~that~~ these challenging market dynamics can be mitigated by our relationships with vascular surgeons, there can be no assurance that we will ~~be successful~~succeed in ~~these~~ highly competitive markets.

We have also experienced success in international markets, such as Europe, where we have a significant sales force, and sometimes offer comparatively lower average selling ~~prices.~~prices than in North America. If we continue to seek growth opportunities outside of ~~the~~ North America, we ~~will likely~~may experience downward pressure on our gross margin.

Our strategy for growing our business includes the acquisition of complementary product lines and companies, which can be difficult to identify, negotiate and purchase, and there can be no assurance that we will be able to do so in the future.

Occasionally we discontinue or divest products or product lines that are no longer complementary to our business or that are not commercially viable.

From time to time we may undertake SKU reductions or transition sales to other SKUs or products with similar features. For example, in 2022, we initiated the transition of sales of our Syntel spring tip catheter to our legacy regular tip catheter. Any of these actions may result in inventory write-offs and temporary or permanent negative impacts to our sales, gross margin and customer relationships.

Because we believe thatdirect-to-hospital sales engender closer customer relationships, and allow for higher selling prices and gross margins, we periodically enter into transactions with our distributors to transition their sales of our medical devices tointo our direct sales organization:

~~During 2015, we entered into definitive agreements with seven former UreSil, LLC distributors in Europe in order to terminate their distribution of ourTru-Incise~~ ~~valvulotome and we began sellingdirect-to-hospital~~ ~~in those geographies. The total of these termination fees was approximately $0.2 million~~

~~In August 2015, we entered into a definitive agreement with Grex Medical Oy (Grex), our distributor in Finland, in order to terminate their distribution of our products and we began sellingdirect-to-hospital~~ ~~in Finland as of January 1, 2016. The termination fee was approximately $0.2 million.~~

We anticipate that the expansion of our direct sales organization in China will result in increased sales, marketing and regulatory expenses during 2017. As of September 30, 2017 we had seven employees in China.

Our strategy for growing our business includes the acquisition of complementary product lines and companies and occasionally the discontinuance or divestiture of products or activities that are no longer complementary:

•

During 2020, we entered into definitive agreements with, or participated with Anteris in concluding agreements with, several former Anteris distributors in Europe and Canada, in order to terminate their distribution of the acquired bovine cardiac and vascular patch products, and we began selling direct-to-hospital in those geographies. The distribution termination fees totaled approximately $0.1 million.

~~In May 2015, we acquired the production and distribution rights of UreSil LLC’sTru-Incise~~ ~~valvulotome for sales outside of the United States for $1.4 million.~~

~~In July 2015, we entered into an asset sales agreement with Merit Medical Ireland Limited to sell our inventory, intellectual property and customer lists associated with The UnBalloon, ournon-occlusive~~ ~~modeling catheter product line for $0.4 million.~~

~~In December 2015, we terminated our InvisiGrip vein stripper product line, and wrote down $0.1 million of related inventory in Q3 2015.~~

In March 2016, we acquired substantially all of the assets as well as the production and distribution rights of the ProCol business from Hancock Jaffe Laboratories and CryoLife, Inc. for $2.7 million plus 10% of net sales for three years following the closing. ProCol is a biologic vascular graft used for dialysis access, and is approved for sale in the United States.

In November 2016, we acquired substantially all of the assets related to the peripheral vascular allograft operations of Restore Flow Allografts, LLC for $12.0 million plus additional payments of up to $6 million, depending upon the satisfaction of certain contingencies.

~~In addition to relying upon acquisitions to grow our business, we~~We also rely, to a lesser extent, on ~~our product~~internal development efforts to bring differentiated technology and next-generation products and services to ~~market. These efforts have led to the following recent product developments:~~market:

~~In October 2016, we launched additional sizes of our XenoSure patch.~~

~~In December 2016, we launched the 7.0mm diameter Omniflow II graft.~~

~~In October 2017, we launched XenoSure pledgets.~~

In addition to our sales growth strategies, we have also executed on several operational initiatives designed to consolidate ~~and streamline~~ manufacturing ~~within~~into our Burlington ~~facility.~~facilities. We expect these plant consolidations will result in improved control over production ~~control,~~quality as well as reduced ~~costs over the long-term.~~costs. Our most recent manufacturing ~~transitions~~transfers included:

~~In March 2015,~~

•

In June 2014, we acquired the Omniflow II ovine graft business from BioNova, International. In June 2019, we initiated a project to transfer the production of these devices to our Burlington facilities. We received CE mark approval to sell these Burlington produced devices in Europe in June 2022. This transfer was completed in 2023.

	•	In October 2019, we acquired the CardioCel biologic patch business from Anteris. In July 2020, we initiated a project to transfer the production of these devices to our Burlington facilities. We expect these transfer activities to be substantially complete in 2023. In June 2023, the MDR CE mark application to market these Burlington produced devices was submitted, and we anticipate this application process to take 18-24 months.

	•	In June 2018, we acquired the Cardial business from Becton Dickinson. Cardial manufactured polyester vascular grafts, valvulotomes and surgical glue at its St. Etienne, France facility. In June 2022, we closed the St. Etienne factory in order to streamline manufacturing operations and to reduce expenses. We are transitioning Cardial graft sales to our Burlington-manufactured polyester vascular graft product (AlboGraft) for additional cost savings and improved margins.

Finally, from time to time we ~~initiated a project~~may enter into distribution agreements of complementary product lines with the option to ~~transfer~~acquire the ~~manufacturing of the newly acquired angioscope~~ product line to our Burlington facility. We had been purchasing the devices from Applied Medical since the September 2014 acquisition and completed the transition of manufacturing to our Burlington facility in December 2015.

~~In May 2015, we initiated a project to transfer the manufacturing of the newly acquiredTru-Incise~~ ~~valvulotome product line to our Burlington facility. We have been purchasing the devices from UreSil, LLC since the acquisition. We completed this transition~~ in the ~~first half of 2017.~~

In March 2016, we initiated a project to transfer the manufacturing of the newly acquired ProCol biologic product line to our Burlington facility. We have an agreement to purchase the product from Hancock Jaffe Laboratories for up to three years following the closing. We initiated the transfer of the production line and transition of manufacturing in 2016, and we expect the transfer to be complete in 2018, subject to regulatory approval.

In the fourth quarter of 2017, we expect to complete the renovation of our Burlington facility, where we expect several of our biologic offerings, including the XenoSure patch and the ProCol biologic graft, will be produced or processed. We believe the cost of the facility renovation will be approximately $2.3 million, of which approximately $1.8 million has been incurred through September 30, 2017.

Our execution of these ~~business opportunities~~initiatives may affect the comparability of our financial results ~~from period to period~~ and may cause ~~substantial~~ fluctuations from period to period as we incur related expenses such as process engineering and other ~~charges, as well as longer term impacts~~charges.

In 2024, we expect to ~~revenues~~implement a new Enterprise Resource Planning (“ERP”) system to replace our current software reporting and ~~operating expenditures.~~planning system. We expect that the new ERP system will be beneficial in a number of areas, including inventory management, pricing programs, financial operations and real time reporting. While we have been preparing for this transition since 2022, and have hired an experienced consulting team to assist us in this transition, there can be no assurances that the implementation will be successful or executed in a timely fashion. We expect to spend approximately $7.0 million on this implementation.

Fluctuations in the ~~rate of~~ exchange rates between the U.S. dollar and foreign currencies, primarily the Euro, affect our financial results. For the nine months ended September 30, ~~2017,~~2023, approximately ~~42%~~39% of our sales ~~were to customers located~~took place outside of the ~~United States.~~U.S., largely in currencies other than the U.S. dollar. We expect ~~that~~ foreign currencies will ~~continue to~~ represent a significant percentage of ~~our~~ future sales. Selling, marketing, and administrative costs related to these sales are ~~largely~~also denominated in ~~the local currency,~~foreign currencies, thereby partially mitigating our bottom-line exposure to exchange rate fluctuations. However, ~~as most of our foreign sales are denominated in local currency,~~ if there is ~~a decrease~~an increase in the rate at which a foreign currency is exchanged for U.S. dollars, it will require more of the foreign currency to equal a specified amount of U.S. ~~dollars.~~dollars than before the rate increase. In such cases we will record less revenue in U.S. dollars than we did ~~prior to~~before the exchange rate ~~increase.~~changed. For the nine months ended September 30, ~~2017,~~2023, we estimate that the effects of changes in foreign exchange rates decreased our reported sales by approximately $0.3 ~~million.~~million, as compared to rates in effect for the nine months ended September 30, 2022.

The following is a description of the primary components of our net sales and expenses:

Net sales. We derive our net sales from the sale of our products and services, less discounts and returns. Net sales include the shipping and handling fees paid for by our customers. Most of our sales are generated by our direct sales force and are shipped and billed to hospitals or clinics throughout the world. In countries where we do not have a direct sales force, sales are primarily to distributors, who in turn sell to hospitals and clinics. In certain cases our products are held on consignment at a hospital or clinic prior to purchase; in ~~these~~those instances we recognize revenue at the time the product is used in surgery rather than at shipment.

Cost of sales. We manufacture the majority of the products that we sell. Our cost of sales consists primarily of manufacturing personnel, raw materials and components, depreciation of property and equipment, and other allocated manufacturing overhead, as well as ~~the~~ freight expense we pay to ship products to customers.

Sales and marketing. Our sales and marketing expense consists primarily of salaries, commissions, stock-based compensation, travel and entertainment, sales meetings, attendance at vascular and cardiac congresses, training programs, advertising and product promotions, direct mail and other marketing costs.

General and administrative. General and administrative expense consists primarily of executive, finance and human resource ~~expense,~~salaries, stock-based compensation, legal and accounting fees, ~~acquisition-related charges,~~ information technology expense, intangible asset amortization expense and insurance expense.

Research and development. Research and development expense primarily includes costs associated with ~~the design, development, testing, enhancement~~obtaining and maintaining regulatory approval of our products, ~~principally~~ salaries, laboratory testing and supply costs. It also includes costs associated with the design and execution of clinical studies, ~~regulatory submissions and~~ costs to register, maintain, and defend our intellectual property, and ~~royalty payments~~costs to transfer the manufacturing of acquired product lines to our Burlington facility. Also included are costs associated with ~~licensed~~the design, development, testing and ~~acquired intellectual property.~~enhancement of new or existing products.

Other income (expense). Other income (expense) primarily includes interest income and expense, foreign currency gains (losses), and other miscellaneous gains (losses).

Income tax expense. We are subject to federal and state income taxes for earnings generated in the ~~United States,~~U.S., which include operating losses or profits in certain foreign jurisdictions for certain years depending on tax elections made, and foreign taxes on earnings of our wholly-owned foreign subsidiaries. Our consolidated tax expense is affected by the mix of our taxable income (loss) in the ~~United States~~U.S. and foreign subsidiaries, permanent items, discrete items, unrecognized tax benefits, and amortization of goodwill for U.S. tax reporting purposes.

Comparison of the ~~three~~three- and ~~nine months~~nine-month periods ended September 30, ~~2017~~2023 to the ~~three~~three- and ~~nine months~~nine-month periods ended September 30, ~~2016.~~2022:

The following tables set forth, for the periods indicated, our ~~results of operations,~~ net sales by geography, and the change between the specified periods expressed as a percentage increase or decrease:

Net sales. Net sales increased ~~$1.6~~by $8.4 million, or 7%21%, to ~~$24.8~~$47.4 million for the three months ended September 30, ~~2017,~~2023, compared to ~~$23.2~~$39.0 million for the three months ended September 30, ~~2016. Sales increases for~~2022. The increase was driven primarily by elevated hospital procedure volumes, higher average selling prices, additional sales representatives, and $1.3 million in sales related to our new porcine patch product line. Valvulotome sales increased $1.8 million, bovine vascular patch sales increased $1.2 million and bovine graft sales increased $1.0 million. We estimate that the weaker U.S. dollar increased net sales by $0.7 million during the three months ended September 30, ~~2017 were due in large part~~2023 as compared to ~~sales of our RestoreFlow service offering (acquired in~~ the fourth quarter of 2016) of $1.6 million. Other products with increased sales included carotid shunts of $0.4 million and Omniflow II biosynthetic vascular grafts of $0.2 million, which were offset by lower sales of valvulotomes of $0.6 million.three months ended September 30, 2022.

Net sales increased ~~$8.8~~by $23.9 million, or ~~13%~~20%, to ~~$74.7~~$144.6 million for the nine months ended September 30, ~~2017,~~2023, compared to ~~$65.9~~$120.7 million for the nine months ended September 30, ~~2016. Sales increases~~2022. The increase was driven primarily by elevated hospital procedure volumes, higher average selling prices, additional sales representatives, and $2.6 million in sales related to our new porcine patch product line. Valvulotome sales increased $5.3 million, bovine graft sales increased $3.5 million, and bovine vascular patch sales increased $3.4 million. We estimate that the stronger U.S. dollar decreased net sales by $0.3 million during the nine months ended September 30, 2023 as compared to the nine months ended September 30, 2022.

Direct-to-hospital net sales were 96% of our total net sales for the nine months ended September 30, 2017 were due in large part to sales of our RestoreFlow service offering of $4.4 million. Other products with increased sales included biologic vascular patches of $2.8 million, carotid shunts of $0.9 million, Omniflow II biosynthetic vascular grafts of $0.6 million,2023 and ~~vessel closure systems of $0.6 million, which were offset by lower sales of valvulotomes of $0.7 million.~~2022.

~~Direct-to-hospital~~ ~~net sales were 93% and 92% for the nine months ended September 30, 2017 and September 30, 2016, respectively.~~

Net sales by geography. Net sales in the Americas increased ~~$0.9~~$5.2 million, or 6%20%, for the three months ended September 30, ~~2017.~~2023 as compared to the three months ended September 30, 2022. The increase was ~~due in large part to~~driven primarily by increased sales of ~~our RestoreFlow service offering~~valvulotomes of $1.3 million, porcine patches of $1.3 million, bovine grafts of $1.0 million, and bovine vascular patches of $0.5 million.

Net sales in the Americas increased $15.5 million, or 19%, for the nine months ended September 30, 2023 as compared to the nine months ended September 30, 2022. The increase was driven primarily by increased sales of valvulotomes of $4.4 million, bovine grafts of $3.5 million, porcine patches of $2.6 million, allograft preservation services of $1.6 million, and ~~increased sales of carotid shunts of $0.3 million. These increases were partially offset by lower valvulotome sales of $0.8 million and biologic~~bovine vascular patches of ~~$0.3~~$1.4 million. ~~International~~

EMEA net sales increased $2.4 million, or 24%, for the three months ended September 30, ~~2017~~2023 as compared to the three months ended September 30, 2022. The increase was driven primarily by increased sales of bovine vascular patches of $0.6 million, valvulotomes of $0.5 million, carotid shunts of $0.4 million, and bovine cardiac patches of $0.4 million.

EMEA net sales increased $7.0 million, or 23%, for the nine months ended September 30, 2023 as compared to the nine months ended September 30, 2022. The increase was driven primarily by increased sales of bovine vascular patches of $1.6 million, carotid shunts of $1.5 million, valvulotomes of $0.9 million, and bovine cardiac patches of $0.9 million.

Asia Pacific net sales increased $0.7 million, or ~~8% due mainly~~30%, for the three months ended September 30, 2023 as compared to ~~higher~~the three months ended September 30, 2022. The increase was driven primarily by increased sales of ~~biologic~~over-the-wire embolectomy catheters of $0.2 million and occlusion catheters, bovine cardiac patches and bovine vascular patches of $0.1 million, respectively.

Asia Pacific net sales increased $1.4 million, or 19%, for the nine months ended September 30, 2023 as compared to the nine months ended September 30, 2022. The increase was driven primarily by increased sales of bovine vascular patches and occlusions catheters of $0.4 million, respectively, and over-the-wire embolectomy catheters and bovine cardiac patches of $0.2 million, respectively.

The following table sets forth the change in our gross profit and ~~valvulotomes of $0.2~~gross margin for the periods indicated:

Gross Profit.Gross profit increased $5.7 million, ~~as well as carotid shunts, biosynthetic vascular grafts~~or 23%, to $30.8 million for the three months ended September 30, 2023, and ~~polyester vascular grafts, each of $0.1 million.~~

~~Net sales~~gross margin increased 80 basis points to 65% in the ~~Americas~~period. The increase in gross profit was driven primarily by increased ~~$6.9~~sales, particularly from valvulotomes, porcine patches, bovine vascular patches and bovine grafts. The increase in gross margin was driven primarily by favorable product mix, including sales of comparatively higher margin valvulotomes, and manufacturing efficiencies, which were partially offset by increased scrap and excess and obsolescence charges.

Gross profit increased $14.9 million, or 19%, to $93.8 million for the nine months ended September 30, 2017. The increase was due in large part to sales of our RestoreFlow service offering of $4.4 million, as well as our ProCol biologic grafts of $0.4 million. We also recorded increased sales of our biologic vascular patches of $1.8 million, vessel closure systems of $0.5 million2023, and carotid shunts of $0.6 million. These increases were partially offset by lower sales of valvulotomes of $0.8 million. International net sales for the nine months ended September 30, 2017 increased $1.9 million, or 7%, due mainly to higher sales of biologic vascular patches, Omniflow II biosynthetic grafts and powered phlebectomy devices, partially offset by decreased sales of catheters and ePTFE vascular grafts.

~~Gross Profit.~~~~Gross profit increased $0.6 million to $17.6 million for the three months ended September 30, 2017, while~~ gross margin decreased ~~by 250~~50 basis points to 70.8%. The gross margin decrease was mainly the result of the addition of our RestoreFlow service offering in November 2016, which carries comparatively lower gross margins than our other products, as well as lower valvulotome sales and an unfavorable geographic mix of our revenues. These factors were offset partially by pricing increases in 2017 as well as the effects of foreign exchange.

~~Gross profit increased $5.7 million to $52.4 million for the nine months ended September 30, 2017, while gross margin decreased by 80 basis points to 70.2%~~64.9% in the period. The increase in gross profit was driven primarily by increased sales, particularly from valvulotomes, bovine grafts and bovine vascular patches. The decrease in gross margin ~~decrease~~ was ~~mainly the result~~driven primarily by increases in labor costs, unfavorable product mix, including sales of ~~the addition~~comparatively lower margin porcine patches and sales of our ~~RestoreFlow service offering~~allograft preservation services, and increased scrap and excess and obsolescence charges.

The following tables set forth changes in ~~November 2016, which carries comparatively lower gross margins than~~ our ~~other products, as well as lower valvulotome sales, which were partially offset by pricing increases, favorable geographic and product mix, and the effects of foreign exchange.~~

~~Our~~ operating expenses for the ~~three~~periods indicated and ~~nine month~~the change between the specified periods ~~ended September 30, 2017 and 2016 consisted of the following (in thousands):~~expressed as a percentage increase or decrease:

Sales and marketing. ~~Sales and marketing expenses for~~For the three months ended September 30, 2017 decreased $0.3 million or 5% vs. the September 30, 2016 period. Decreases were mainly driven by a decline in compensation-related costs of $0.2 million related to fewer direct sales representatives as well as the vacancy in the position of Vice President Sales, The Americas. Sales meeting expense also decreased $0.1 million due to an event held in the 2016 period that was not held in the 2017 period.

~~For the nine months ended September 30, 2017,~~2023, sales and marketing expenses increased ~~$0.4 million or 2%~~18% to ~~$19.8~~$9.7 million. The increase was driven primarily ~~driven~~ by higher sales rep headcount and higher sales commissions, which resulted in increased ~~compensation-related~~compensation and related expenses of $1.4 million. Travel, training and related ~~to an~~expenses increased by $0.1 million. Sales rep headcount was 136 as of September 30, 2023, a 15% increase ~~in the average number of sales representatives during the comparative periods,~~ from ~~91 in 2016 to 93 in 2017.~~September 30, 2022. As a percentage of net sales, sales and marketing expense decreased to ~~26%~~20% for the three months ended September 30, 2023, down from 21% in the prior period.

For the nine months ended September 30, ~~2017~~2023, sales and marketing expenses increased 27% to $30.8 million. The increase was driven primarily by higher sales rep headcount and higher sales commissions, which resulted in increased compensation and related expenses of $5.3 million. Travel, training and related expenses increased by $0.6 million. As a percentage of net sales, sales and marketing expense increased to 21% for the nine months ended September 30, 2023, up from ~~29%~~20% in the prior ~~year period due to higher sales in the current~~ period.

General and administrative. For the three months ended September 30, ~~2017,~~2023, general and administrative expenses increased 7% to $7.7 million. The increase was driven primarily by higher outside services and professional fees of $1.0 million, ~~or 27% to $4.6 million. Included in the current period is a charge of $0.5 million~~which were partially offset by lower compensation and related ~~to a stock option award modification associated with the recent departure of our President of International Operations. We also had higher compensation costs~~expenses of $0.2 million, ~~acquisition-related charges of $0.2 million, and recruiting~~facility fees of $0.1 million, and acquisition costs of $0.1 million. Lower acquisition costs were driven by gains related to the amendment of a contingent purchase obligation associated with our 2019 Anteris biologic patch acquisition. As a percentage of sales, general and administrative expense decreased to 16% for the three months ended September 30, 2023, down from 19% in the prior period.

For the nine months ended September 30, ~~2017,~~2023, general and administrative expenses increased ~~$2.5 million, or 24%,~~7% to ~~$12.9~~$23.4 million. ~~Increases included the aforementioned stock option award modification charge,~~The increase was driven primarily by higher compensation ~~costs~~and related expenses of ~~$0.5 million, acquisition-related charges of $0.6 million, facility-related costs of $0.5 million in connection with expanding our Burlington manufacturing operations,~~$1.1 million. Travel, training and ~~professional service fees of $0.3~~related expenses increased by $0.2 million. As a percentage of ~~net~~ sales, general and administrative ~~expenses increased~~expense decreased to ~~17%~~16% for the nine months ended September 30, ~~2017 as compared to 16% for~~2023, down from 18% in the ~~year-earlier~~prior period.

Research and development. ~~Research~~For the three months ended September 30, 2023, research and development expenses increased 22% to $4.2 million. The increase was driven by higher compensation and related expenses of $0.4 million. Outside services and testing increased by $0.3 million primarily due to higher consulting and third-party costs largely associated with European regulatory approvals. Our products are currently regulated in the European Union (EU) and the United Kingdom under the European Medical Devices Directive (MDD) and the EU Medical Device Regulation (MDR). In order to market our medical devices in the EU and the United Kingdom, we are required to obtain CE marks, which denote conformity to the essential requirements of the MDD or MDR. As a percentage of sales, research and development expense was unchanged at 9% for the three months ended September 30, ~~2017 increased $0.2 million or 14% to $1.8 million, primarily due to higher professional services and testing costs.~~2023.

For the nine months ended September 30, ~~2017,~~2023, research and development expense increased 30% to $12.6 million. The increase was driven by higher compensation and related expenses of $1.1 million. Outside services and testing increased ~~$0.4~~by $1.5 million ~~or 9%, to $5.1 million. Increases were~~ primarily due to higher ~~compensation~~consulting and third-party costs ~~as well as higher product testing~~largely associated with European regulatory approvals. As a percentage of sales, research and development expense increased to 9% for the nine months ended September 30, 2023, up from 8% in the prior period.

Restructuring. For the nine months ended September 30, 2023, restructuring expenses ~~related to clinical~~were $0.5 million. On June 30, 2022, we ceased operations at our St. Etienne, France factory. The closure resulted in a restructuring charge of $3.1 million for the year ended December 31, 2022. These charges consisted primarily of employment termination costs, impairment of fixed assets and ~~regulatory.~~inventory, and third-party costs. For the nine months ended September 30, 2023 we recorded additional restructuring charges in conjunction with the St. Etienne, France factory closure of $0.5 million. The additional charges consisted primarily of employment termination, settlement, legal and other third-party costs. As a percentage of sales, restructuring expense was less than 1% for the nine months ended September 30, 2023. There was no restructuring charges for the three months ended September 30, 2023.

Income tax expense.We recorded a tax provision of ~~$31,000~~$2.3 million onpre-tax income of ~~$5.1~~$9.8 million for the three months ended September 30, ~~2017,~~2023, compared to a ~~$2.1~~$0.7 million tax provision onpre-tax income of ~~$5.3~~$6.1 million for the three months ended September 30, ~~2016.~~2022. We recorded a tax provision of ~~$1.9~~$6.5 million onpre-tax income of ~~$14.8~~$28.2 million for the nine months ended September 30, ~~2017,~~2023, compared to ~~$4.4~~a tax provision of $4.7 million onpre-tax income of ~~$12.4~~$19.7 million for the nine months ended September 30, ~~2016.~~2022. Our effective income tax rate was ~~0.6%~~23.6% and ~~12.8%~~23.1% for the ~~three~~three- and ~~nine month~~nine-month periods ended September 30, ~~2017.~~2023. Our tax expense for the current period is based on an estimated annual effective tax rate of ~~36.8%~~24.9%, adjusted in the applicable quarterly periods for discrete stock option exercises and other discrete items. Our income tax expense for the current period varies from the statutory rate mainly due to ~~certain~~the generation of federal and state tax credits, permanent items, ~~offset by lower~~different statutory rates from our foreign entities, and a discrete item for stock option exercises.

Our effective income tax rate was ~~39.2%~~11.3% and ~~35.6%~~23.8% for the ~~three~~three- and ~~nine month~~nine-month periods ended September 30, ~~2016.~~2022. Our ~~2016~~2022 provision was based on the estimated annual effective tax rate of ~~34.8%~~25.1%, adjusted in the applicable quarterly period for discrete stock option exercises and other discrete items. Our income tax expense for ~~2016~~the three-and nine-month periods ended September 30, 2022 varied from the statutory rate mainly due to ~~certain~~federal and state tax credits, permanent items, ~~offset by lower~~different statutory rates from our foreign entities, and a discrete item for stock option exercises.

We monitor the mix of profitability by tax jurisdiction and adjust our annual expected rate on a quarterly basis as needed. While it is often difficult to predict the final outcome or timing of the resolution for any particular tax matter, we believe ~~that~~ our tax reserves reflect the probable outcome of known contingencies.

We assess the likelihood that our deferred tax assets will be realized through future taxable income and record a valuation allowance to reduce gross deferred tax assets to an amount that we believe is more likely than not to be realized. As of September 30, ~~2017,~~2023, we have provided a valuation allowance of ~~$1.9~~$1.6 million for deferred tax assets primarily related to Australian net operating loss and capital loss carry forwards and Massachusetts tax credit carry forwards that are not expected to be realized.

The Inflation Reduction Act ("IRA") was enacted into law on August 16, 2022. Included in the IRA was a provision to implement a 15% corporate alternative minimum tax on “adjusted financial statement income” for applicable corporations and a 1% excise tax on repurchases of stock. These provisions are effective for tax years beginning after December 31, 2022. We ~~expect that~~are in the process of evaluating the provisions of the IRA, but we do not currently believe the IRA will have a material impact on our effective tax rate will remain somewhat inconsistent for the remainder of 2017 due to the timing of exercises of certain employee stock options. We expect our 2017 effective tax rate will be lower than our 2016 effective tax rate mainly due to exercises of stock options in 2017.

As of September 30, ~~2017,~~2023, our cash and cash equivalents were ~~$37.5~~$18.1 million as compared to ~~$24.3~~$19.1 million atas of December 31, ~~2016.~~2022. We had $79.0 million in short-term marketable securities as of September 30, 2023 and $63.6 million as of December 31, 2022. Our cash and cash equivalents are ~~highly~~ liquid investments with maturities of 90 days or less at the date of purchase, and consist primarily of operating bank ~~accounts~~accounts. Our short-term marketable securities consist of a managed income mutual fund investing mainly in short-term investment grade, U.S. dollar denominated fixed and ~~money~~floating-rate debt, and a short-duration bond fund. As of September 30, 2023 our short-term marketable securities reflected an unrealized loss of $2.0 million as a result of increasing market funds, and are stated at cost, which approximates fair value. All of our cash held outside of the United States is available for corporate use, with the exception of $7.8 million held by certain international subsidiaries where earnings are planned to be permanently reinvested.interest rates.

On ~~July 25, 2016,~~February 21, 2023, our Board of Directors ~~approved a stock~~authorized the repurchase ~~program under which the Company was authorized to repurchase~~of up to $5$25.0 million of ~~its~~the Company’s common stock through transactions on the open market, in privately negotiated purchases or ~~otherwise. We did not make any repurchases under this program prior to its July 25, 2017 expiration.~~

~~On July 25, 2017, our Board of Directors approved a stock~~otherwise until February 21, 2024. The repurchase ~~program under which the Company is authorized to repurchase up to $7.5 million of its common stock through transactions on the open market, in privately negotiated purchases or otherwise. This~~ program may be suspended or discontinued at any ~~time, and expires on the earlier of July 25, 2018 or when the authorized aggregate $7.5 million repurchase limit is reached, unless extended by our Board of Directors.~~time. To date we have not made any repurchases under this program.

We require cash to pay our operating expenses, make capital expenditures, and pay our long-term liabilities. Since our inception, we have funded our operations through public offerings and private placements of equity securities, short-term and long-term borrowings, and funds generated from our operations.

We recognized operating income of ~~$14.8~~$26.5 million for the nine months ended September 30, ~~2017.~~2023. For the year ended December 31, ~~2016,~~2022, we had operating income of ~~$16.3~~$26.8 million. We expect to fund any increased costs and expenditures from our existing cash and cash equivalents, though our future capital requirements depend on numerous factors. These factors include, but are not limited to, the following:

~~the~~

•

revenues generated by sales of our products and services;

•

payments associated with potential future quarterly cash dividends to our common stockholders;

•

future acquisition-related payments;

•

payments associated with income and other taxes;

•

costs associated with expanding our manufacturing, marketing, sales, and distribution efforts;

•

costs associated with our initiatives to sell direct-to-hospital in new countries;

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~~payments associated with potential future quarterly cash dividends to our common stockholders;~~

•

costs of obtaining and maintaining U.S. FDA and other regulatory clearances for our existing and future products;

~~future acquisition-related payments;~~

•

costs associated with obtaining European MDR clearances for our existing and future products;

~~payments associated with income and other taxes;~~

•

the number, timing, and nature of acquisitions, divestitures and other strategic transactions, and

~~the costs associated with expanding our manufacturing, marketing, sales, and distribution efforts;~~

•

potential future share repurchases.

~~the costs associated with our initiatives to selldirect-to-hospital~~ ~~in new countries;~~

~~the costs of obtaining and maintaining FDA and other regulatory clearances of our existing and future products;~~

~~the number, timing, and nature of acquisitions and other strategic transactions, and~~

~~potential future share repurchases.~~

Our cash balances may decrease as we continue to use cash to fund our operations, make acquisitions, ~~make payments under~~pay dividends, repurchase shares of our ~~quarterly dividend program, make share repurchases,~~common stock and make deferred payments related to prior acquisitions. We believe that our cash, cash equivalents, investments and the interest we earn on these balances will be sufficient to meet our anticipated cash requirements for at least the next twelve ~~months.~~months and to meet our known long-term cash requirements. If these sources of cash are insufficient to satisfy our liquidity requirements beyond the next twelve months, we may seek to sell additional equity or debt securities or ~~borrow funds from, or establish~~take out a ~~revolving credit facility with a financial institution.~~loan. The sale of additional equity and debt securities may result in dilution to our ~~stockholders.~~stockholders, as was the case with our July 2021 equity offering. If we raise additional funds through the issuance of debt securities, such securities could have rights senior to those of our common stock and could contain covenants that would restrict our operations and possibly our ability to pay dividends. We may require additional capital beyond our ~~currently-forecasted~~currently forecasted amounts. Any such required additional capital may not be available on reasonable terms, if at all.

Dividends

In February 2011, our Board of Directors approved a policy for the payment of quarterly cash dividends on our common stock. Future declarations of quarterly dividends and the establishment of future record and payment dates are subject to approval by our Board of ~~Directors.~~Directors on a quarterly basis. The dividend activity for the periods presented is as follows:

Record Date
   Payment Date    Per Share Amount    Dividend Payment
         (in thousands)
Fiscal Year 2017

March 22, 2017
   April 6, 2017    $ 0.055    $ 1,029
May 24, 2017
   June 8, 2017    $ 0.055    $ 1,036
August 23, 2017
   September 6, 2017    $ 0.055    $ 1,055
Fiscal Year 2016

March 21, 2016
   April 4, 2016    $ 0.045    $ 825
May 25, 2016
   June 8, 2016    $ 0.045    $ 829
August 22, 2016
   September 2, 2016    $ 0.045    $ 833
November 21, 2016
   December 5, 2016    $ 0.045    $ 836

Record Date	Payment Date	Per Share Amount		Dividend Payment
				(in thousands)
Fiscal Year 2023
March 9, 2023	March 23, 2023	$	0.140	$	3,099
May 17, 2023	June 1, 2023	$	0.140	$	3,116
August 17, 2023	August 31, 2023	$	0.140	$	3,117

Fiscal Year 2022
March 8, 2022	March 24, 2022	$	0.125	$	2,743
May 17, 2022	June 2, 2022	$	0.125	$	2,745
August 25, 2022	September 8, 2022	$	0.125	$	2,750
November 17, 2022	December 1, 2022	$	0.125	$	2,750

Cash Flows


	Nine months ended September 30,									Nine months ended September 30,
	(in thousands)									(in thousands)
	2017			2016			Net Change			2023			2022			Net Change
Cash and cash equivalents	$	37,514		$	34,650		$	2,864		$	18,051		$	16,913		$	1,138

Cash flows provided by (used in):
Operating activities	$	16,098		$	12,702		$	3,396		$	26,005		$	21,301		$	4,704
Investing activities		(4,780	)		(4,198	)		(582	)		(22,454	)		(9,969	)		(12,485	)
Financing activities		1,146			(1,535	)		2,681			(4,445	)		(7,112	)		2,667

Net cash provided by ~~(used in)~~ operating activities. Net cash provided by operating activities was ~~$16.1~~$26.0 million for the nine months ended September 30, ~~2017,~~2023, consisting of ~~$12.9~~$21.6 million in net income, ~~adjusted~~adjustments fornon-cash or non-operating items of ~~$5.2~~$12.9 million (including primarily depreciation and amortization of ~~$3.0~~$7.1 million, stock-based compensation of ~~$1.8~~$3.9 million, ~~and~~ provisions for inventory write-offs and doubtful accounts of ~~$0.4~~$1.5 million and loss on divestiture of $0.5 million), and ~~offset by changes in~~also a net use of working capital of ~~$2.0~~$8.6 million. The net cash used for working capital was driven by ~~increases~~an increase in ~~inventory of $1.3 million,~~ accounts receivable of ~~$0.1~~$2.1 million, an increase in inventory and other deferred costs of $7.6 million, and an increase in prepaid expenses and other ~~current~~ assets of ~~$1.4 million,~~$1.2 million. These cash uses were offset by ~~a decrease~~an increase in accounts payable and other liabilities of ~~$0.8~~$2.3 million.

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Net cash provided by operating activities was ~~$12.7~~$21.3 million for the nine months ended September 30, ~~2016, and consisted~~2022, consisting of ~~$8.0~~$15.0 million in net income, ~~adjusted~~adjustments fornon-cash or non-operating items of ~~$4.2~~$14.2 million (including primarily depreciation and amortization of ~~$2.7~~$7.1 million, stock-based compensation of ~~$1.2~~$3.5 million, ~~and~~ provisions for inventory write-offs and doubtful accounts of ~~$0.3~~$2.3 million, and loss on divestiture of $1.4 million), ~~as well as changes in~~and also a net use of working capital of ~~$0.5~~$7.9 million. The net cash used ~~by changes in~~for working capital was driven by ~~increases~~an increase in inventory and other deferred costs of $5.0 million, an increase in accounts receivable of $1.7 million, and an increase in prepaid expenses and other assets of $1.3 million. These cash uses were offset by an increase in accounts payable and other liabilities of ~~$1.2 million offset by decreases in other current assets of $0.4 million, inventory of~~ $0.2 ~~million and accounts receivable of $0.1~~ million.

Net cash used in investing activities. Net cash used in investing activities was ~~$4.8~~$22.5 million for the nine months ended September 30, ~~2017. This was primarily driven by~~2023, consisting of purchases of marketable securities of $15.6 million, expenditures on ~~leasehold improvements~~equipment and ~~equipment associated with the expansion~~technology of ~~our Burlington facility.~~$6.0 million, and acquisition related payments of $0.9 million.

Net cash used in investing activities was $4.2 million for nine months ended September 30, 2016, driven by $2.4 million of cash paid in connection with our acquisition of the ProCol biologic vascular grafts, as well as purchases of property and equipment of $1.8 million primarily associated with the expansion of our Burlington facility

~~Net cash provided by (used in) financing activities.~~ ~~Net cash provided by financing activities was $1.1~~$10.0 million for the nine months ended September 30, ~~2017,~~2022, consisting of purchases of marketable securities of $8.0 million and expenditures on equipment and technology of $2.0 million.

Net cash used in financing activities. Net cash used in financing activities was $4.4 million for the nine months ended September 30, 2023, consisting primarily of a dividend payment of $9.3 million. This use of cash was partly offset by proceeds from stock option exercises of ~~$5.5~~$4.9 million, ~~offset by dividend payments~~net of ~~$3.1 million,~~ shares ~~withheld~~repurchased used to ~~satisfy~~pay employee ~~taxes on restricted stock vesting of $0.8 million and payments related to prior acquisitions of $0.4 million.~~payroll taxes.

Net cash used in financing activities was ~~$1.5~~$7.1 million for the nine months ended September 30, ~~2016, driven~~2022, consisting primarily byof a dividend payment of $8.2 million and deferred payments for acquisitions of ~~common stock dividends~~$0.4 million. This use of ~~$2.5 million, partially~~cash was partly offset by proceeds from stock option exercises of $1.5 million, net of shares ~~withheld~~repurchased to ~~satisfy~~cover employee ~~taxes on restricted stock vesting of $1.2 million. We also made payments related to our prior acquisitions of $0.2 million.~~payroll taxes.

~~Contractual obligations~~. Our principal contractual obligations consist of operating leases and inventory purchase commitments, and have not changed significantly since December 31, 2016 as reported in our Annual Report on Form~~10-K.~~

~~Off-Balance~~ ~~Sheet Arrangements~~

~~We did not have anyoff-balance~~ sheet arrangements as of September 30, 2017. We do not currently have, nor have we ever had, any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating~~off-balance~~ ~~sheet arrangements or other contractually narrow or limited purposes. In addition, we do not engage in trading activities involvingnon-exchange~~ ~~traded contracts. As a result, we are not materially exposed to any financing, liquidity, market or credit risk that could arise if we had engaged in these relationships.~~

Critical Accounting Policies and Estimates

We have adopted various accounting policies to prepare our consolidated financial statements in accordance with U.S. generally accepted accounting principles, or U.S. GAAP. Our most significant accounting policies are described in ~~note~~Note 1 to our consolidated financial statements included in our Annual Report onForm 10-K for the fiscal year ended December 31, ~~2016.~~2022. There have been no material changes in our critical accounting policies during the nine months ended September 30, ~~2017.~~2023. The preparation of our consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the amounts reported in our consolidated financial statements and accompanying notes. Our estimates and assumptions, including those related to ~~bad debts, inventories,~~revenue recognition, inventory valuation, valuation of intangible assets ~~sales returns~~ and ~~discounts, share-based compensation,~~goodwill, contingent consideration and income taxes are reviewed on an ongoing basis and updated as appropriate. Actual results may differ from those estimates.

Recent Accounting Pronouncements

~~In May 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)2017-09~~ ~~which provides guidance on determining which changes to the terms and conditions~~

A summary of ~~share-based payment awards require an entity to apply modification~~recent accounting under ASC 718, Compensation – Stock Compensation. The new standard is effective for us beginning January 1, 2018, with early adoption permitted. The adoption of this standard is not expected to have a materialpronouncements that may impact on our financial ~~statements.~~

~~In January 2017, FASB issued ASU2017-04,~~ ~~which, among other provisions, eliminates “step 2” from the goodwill impairment test. The annual, or interim, goodwill impairment test will~~statements upon adoption in future periods can be performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The new standard is effective for us beginning Januaryfound in Note 1 ~~2020, with early adoption permitted. The adoption of this standard is not expected to have a material impact on our financial statements.~~

~~In January 2017, the FASB issued ASU2017-01~~ which changes the definition of a business for purposes of determining whether a business has been acquired or sold. The amendment is intended to help companies evaluate whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The new standard is effective for us beginning January 1, 2018, with early adoption permitted. The adoption of this standard is not expected to have a material impact on our financial statements.

~~In May 2014, the FASB and the International Accounting Standards Board issued substantially converged final standards on revenue recognition. The FASB’s ASUNo. 2014-09,~~ Revenue from Contracts with Customers (Topic 606), as amended from time to time, outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The new revenue recognition guidance becomes effective for us on January 1, 2018, with early adoption permitted on January 1, 2017. Entities have the option of using either a full retrospective or a modified approach to adopt the guidance in the ASU. Our assessment of the impact to our financial statements included under Part 1, Item 1 of ~~adopting~~ this standard is underway. We engaged external consultants to assist us with our analysis, which included evaluating our standard arrangements with customers, as well as arrangements specific to certain customer bases or product offerings,Quarterly Report on Form 10-Q.

Item3. Quantitative and reviewing a sample of actual contracts to determine whether there are additional attributes to consider beyond our standard arrangements. Although our assessment is not complete, we do not currently expect that adoption of Topic 606 will have a material impact on our consolidated financial statements. However, there will likely be changes to our revenue recognition accounting policy as well as other disclosures.

~~Additionally, we have preliminarily determined that we will use the modified retrospective method of adoption.~~Qualitative Disclosures About Market Risk

~~Item 3.~~

~~Quantitative and Qualitative Disclosures About Market Risk~~

In the ordinary course of conducting business, we are exposed to certain risks associated with potential changes in market conditions. These market risks include changes in currency exchange rates and interest rates which could affect operating results, financial position and cash flows. We manage our exposure to these market risks through our regular operating and financing activities and, if considered appropriate, we may enter into derivative financial instruments such as forward currency exchange contracts, although we have not done so in ~~2017~~2023 or in recent years. There have been no material changes in our quantitative and qualitative market risks since the disclosure in our Annual Report on Form10-K for the year ended December 31, ~~2016.~~

2022.

~~Item 4.~~ ~~Controls and Procedures~~

Item4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation and supervision of our Chief Executive Officer and Chief Financial Officer, is responsible for our disclosure controls and procedures pursuant to Rules13a-15(e) and15d-15(e) under the Exchange Act. Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified under SEC rules and forms. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to our principal executive officer and our principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. We design our disclosure controls and procedures to ensure, at reasonable assurance levels, that such information is timely recorded, processed, summarized and reported, and then accumulated and communicated appropriately.

~~Management conducted~~

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Based on an evaluation of ~~the effectiveness of~~ our internal control over financial reporting based on the framework in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management concluded that the company’s internal control over financial reporting was effectivedisclosure controls and procedures as of September 30, 2017. In November 2016, we acquired substantially all of the assets of the RestoreFlow allograft business from Restore Flow Allografts LLC. This acquired business, which during the nine months ended September 30, 2017 comprised 5.9% of2023 our ~~revenues~~Chief Executive Officer and Chief Financial Officer concluded that, as of ~~that~~such date, ~~comprised approximately 2.5% of~~ our ~~total assets, is excluded from our evaluation of internal control over financial reporting.~~disclosure controls and procedures were effective at reasonable assurance levels.

Changes in Internal Control

There have been no changes in our internal control over financial reporting for the nine months ended September 30, ~~2017~~2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ~~Management is in the process of assessing the effectiveness of internal control over financial reporting for the acquired RestoreFlow allograft business.~~

Inherent Limitations of Internal Controls

Notwithstanding the foregoing, our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any system will succeed in achieving its stated goals under all potential future conditions. Over time, control may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

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Part II. Other Information

~~Item 1.~~

~~Legal Proceedings~~

Item1. Legal Proceedings

In the ordinary course of business, we are from time to time involved in lawsuits, claims, investigations, proceedings, and threats of litigation relating to employment, product liability, commercial arrangements, contracts, intellectual property and other matters. While the outcome of these proceedings and claims cannot be predicted with certainty, there are no matters, as of November ~~1, 2017,~~7, 2023 that management believes would have a material adverse effect on our financial position, results of operations or cash flows.

~~Item 1A.~~ ~~Risk Factors~~
Item1A. Risk Factors

In addition to the information set forth in this report, you should consider the risks and uncertainties discussed in “Part I, Item 1A. Risk Factors” in our Annual Report on Form10-K for the year ended December 31, ~~2016,~~2022, which could materially affect our business, financial condition, or future results. ~~There have been no substantive changes from~~The risk factors below supplement and update the risk factors ~~previously disclosed~~and information discussed in our Annual Report on Form10-K for the year ended December 31, ~~2016,~~2022.

We face intense competition from other companies, technologies, and alternative medical procedures and we may not be able to compete effectively.

The segments in which ~~was filed~~we operate are highly competitive, subject to change, and significantly affected by new product introductions and other activities of industry participants. Although no one company competes against us in all of our product lines or services, a number of manufacturers of peripheral vascular devices have substantially greater capital resources, larger customer bases, broader product lines, larger sales forces, greater marketing and management resources, larger research and development staffs, and larger facilities than ours; have established reputations with our target customers; and have developed worldwide distribution channels that are more effective than ours. Our competitors could elect to devote additional resources to the segments in which we currently enjoy less competition. Also, although we currently have leading positions in the segments for some of our products, this is not true for all of our products. From time to time, we have experienced difficulties competing against large companies.

Our competitors may be companies which are larger than us and have substantially greater financial, technological, research and development, regulatory, marketing, sales, and personnel resources than we do. Certain competitors are able to manufacture at lower costs and may offer comparable products at lower prices. Certain competitors may also have greater experience in developing and improving products, obtaining regulatory approvals, and manufacturing and marketing products. Certain competitors may obtain patent protection or regulatory approval or clearance, or achieve product commercialization, before us, any of which could materially adversely affect us. Further, if the trend towards endovascular procedures versus open vascular procedures continues or accelerates, our competitors may be better positioned to take advantage of that trend, since our main product lines are used primarily in open vascular procedures. New product developments that could compete with us more effectively are likely because the vascular disease market is characterized by extensive research efforts and technological progress. Competitors may develop technologies and products that are safer, more effective, easier to use, less expensive, or more readily accepted than ours. Their products could make our technology and products obsolete or noncompetitive. Our competitors may also be able to achieve more efficient manufacturing and distribution operations than we can. In addition, many of our products face competition from alternative procedures that utilize different kinds of medical devices than we currently sell. Increased competition could also result in price reductions and loss of market share, any of which could result in lower revenues and reduced gross profits.

Other companies that may not be deemed competitors in the peripheral vascular device space in which we operate may develop technologies, products or services that may adversely impact the use of our products and services. For example, certain therapeutic treatments, such as drugs used to treat diabetes or help with weight loss, may enhance patient health and lower the occurrence and severity of the vascular diseases that certain of our products and services are intended to treat. If we do not introduce new products, services and enhancements in a timely manner, there may be a decrease in the use of certain of our products and services by vascular surgeons, in which case our revenues and operating results would suffer.

If we do not comply with international regulatory requirements to market our products outside the United States or are required to modify our operations or products as a result of such requirements, our business will be harmed.

Sales of medical devices outside the U.S. are subject to international regulatory requirements that vary from country to country. These requirements and the amount of time required for approval may differ from our experiences with the U.S. FDA. In some countries, we rely on our international distributors to obtain premarket approvals, complete product registrations, comply with clinical trial requirements, and complete those steps that are customarily taken in the applicable jurisdictions to comply with governmental and quasi-governmental regulation. In the future, we expect to continue to rely on distributors in this manner in those countries where we continue to market and sell our products through them. Failure to satisfy these foreign regulations would impact our ability to sell our products in these countries and could cause our business to suffer. There can be no assurance that we will be able to obtain or maintain the required regulatory approvals in these countries.

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Our products are currently regulated in the European Union (EU) and the United Kingdom under the MDD and the MDR. In order to market our medical devices in the EU, we are required to obtain CE marks, which denote conformity to the essential requirements of the MDD or MDR, and manufacturers of higher-risk devices generally must use a “Notified Body”—an appointed independent third party to assess conformity. We currently use three Notified Bodies for our various products. We have received CE marks under the MDD to sell most of our products and have recently received our first CE mark under the MDR for our Pruitt F3 Carotid Shunt.

In April 2017, the EU adopted new regulations for medical devices, the MDR, which replace the MDD and which started to take effect as of May 26, 2021. The final deadline for compliance with MDR was initially set to May 26, 2024, and subsequently revised to December 31, 2027 and December 31, 2028 for certain classifications of medical devices. Our products will eventually be fully subject to the MDR, which requires all of our products, regardless of classification, to obtain a new CE mark in accordance with the new, more stringent standards under the MDR. As a condition to CE mark approval, clinical evidence will be required for Class III and implantable devices. As our Notified Bodies transition from MDD to MDR, they have begun to impose more rigorous requirements on us. Nearly all of our products have been submitted to our Notified Bodies for review under the MDR. If we fail to obtain new CE marks on these products or our other products under the MDR in a timely manner, or at all, future sales of our products in the EU could be adversely impacted.

There can be no assurance that we will be able to obtain or maintain MDR CE marks for our existing products, and obtaining CE marks may involve a significant amount of time and expense, stringent clinical and preclinical testing, or modification of our products and could result in limitations being placed on the use of our products in order to obtain approval. These types of more stringent restrictions on our products as they transition to MDR could impact sales of our products and/or their gross margins could be adversely impacted. For example, under the MDR CE mark issued in January 2023 for our Pruitt F3 Carotid Shunt, we were unable to secure the new CE marking for the polyurethane balloon models (F3-S). While the MDD CE mark remains valid for the F3-S, we will be required to incur more expenses to gain MDR CE marking for those models. The F3-S models accounted for approximately $53,000 of annual sales in Europe and the U.K. in 2022. Additionally, significant changes to our devices may trigger a requirement to file or obtain an MDR CE mark earlier than expected, which could result in supply chain delays.

Maintaining a CE mark is contingent upon our continued compliance with applicable European medical device requirements, including limitations on advertising and promotion of medical devices and requirements governing the handling of adverse events. As highlighted above, there can be no assurance that we will be successful in obtaining, retaining or maintaining the CE mark for any of our current products. In particular, adverse event reporting requirements in the EU and the U.K. mandate that we report incidents which led or could have led to death or serious deterioration in health. Under certain circumstances, we could be required to or could voluntarily initiate a recall or removal of our product from the market in order to address product deficiencies or malfunctions. Any recall of our products may harm our reputation with customers and divert managerial and financial resources.

As a result of the U.K.’s exit from the EU, the U.K. Medicines and Healthcare Products Regulatory Agency (“MHRA”) announced that CE marking will continue to be recognized in the U.K. and certificates issued by EU-recognized Notified Bodies will continue to be valid in the U.K. market until July 1, 2024. This deadline was subsequently revised by MHRA to coincide with the EU extensions ending in December 31, 2027 and December 31, 2028. Following such dates, all devices marketed in the U.K. will require U.K. Conformity Assessed (“UKCA”) marks certified by a U.K. Approved Body. If we fail to obtain UKCA marks by these deadlines, or at all, our sales in the U.K. could be negatively affected.

Our facilities are subject to periodic inspection by numerous regulatory authorities, including governmental agencies and Notified Bodies, and we must demonstrate compliance with the applicable medical devices regulations. Any failure by us to comply with regulatory requirements may entail our taking corrective action, such as modification of our policies and procedures. In addition, we may be required to cease all or part of our operations for some period of time until we can demonstrate that appropriate steps have been taken. There can be no assurance that we will be found in compliance with such standards in future audits.

We also pursue registrations in other jurisdictions in which we sell our devices directly, such as Japan and China. In 2015, the China Food and Drug Administration (NMPA) significantly increased the application fees for product registrations and imposed additional requirements for obtaining product approval, which includes requirements for conducting clinical trials to support the registration application process on newly introduced products in China. As a result, we may not seek registration for certain products where the cost is not justified. Any delay in product registrations could have a negative impact on our results of operations.

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Item2. Unregistered Sales of Equity Securities and ~~Exchange Commission on March 8, 2017.~~Use of Proceeds

~~Item 2.~~

~~Unregistered Sales of Equity Securities and Use of Proceeds~~

Recent Sales of Unregistered Securities

None.

Issuer Purchases of Equity Securities

   Issuer Purchases of Equity Securities
Period
   Total
Number of
Shares (or Units)
Purchased (1)    Average
Price
Paid Per
Share (or Unit)    Total Number of
Shares (or Units)
Purchased as
Part of Publicly
Announced Plans
or Program    Maximum Number
(or Approximate
Dollar Value) of
Shares (or Units)
that may yet be
Purchased under
the Plans or
Program
July 1, 2017 through July 31, 2017
   27,291    $ 28.51    N/A    N/A
August 1, 2017 through August 31, 2017
   —         N/A    N/A
September 1, 2017 through September 30, 2017
   —         N/A    N/A








Total
   27,291    $ 28.51    N/A    N/A

Issuer Purchases of Equity Securities

Maximum Number

(or Approximate

Total Number of

Dollar Value) of

Shares (or Units)

Total

Average

Purchased as

that may yet be

Number of

Price

Part of Publicly

Purchased under

Shares (or Units)

Paid Per

Announced Plans

the Plans or

Period

Purchased (1)

Share (or Unit)

or Program

Program

July 1, 2023 through July 31, 2023

N/A

August 1, 2023 through August 31, 2023

55.82

N/A

September 1, 2023 through September 30, 2023

N/A

Total

55.82

N/A

(1) For the three months ended September 30, 2023, we repurchased 87 shares of our common stock to satisfy employees’ obligations with respect to minimum statutory withholding taxes in connection with the vesting of restricted stock units.

Item 5. Other Information

Rule 10b5-1 and non-Rule 10b5-1 trading arrangements

During the fiscal quarter ended September 30, 2023, none of our directors or officers informed us of the adoption, modification or termination of a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement, as those terms are defined in Regulation S-K, Item 408.

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Item6. Exhibits

~~(1)~~

For the three months ended September 30, 2017, we withheld 27,291 shares of common stock to satisfy employees’ obligations with respect to minimum statutory withholding taxes in connection with the vesting of restricted stock units.

IncorporatedbyReference

Exhibit

~~Item 6.~~Number
~~Exhibits~~

Exhibit Description

		Form	Date	Number						Filed Herewith
				~~Incorporated by Reference~~
~~Exhibit~~3.1	~~Number~~Amended and Restate d By-laws of the Registrant		~~Exhibit Description~~ S-1/A	5/26/06	001-33092
~~Form~~ 3.2		~~Date~~		~~Number~~ Second Amended and Restated Certificate of Incorporation of the Registrant		~~Filed~~10-K	~~Herewith~~3/29/10	001-33092
3.3
~~31.1~~ Amendment to Second Amended and Restated Certificate of Incorporation of the Registrant		8-K	6/5/12	001-33092
10.1	First Amendment of Lease dated October 18, 2023 between NWP RETAIL 18 LLC and the Registrant					X
10.2	Second Amendment of Lease dated October 18, 2023 between NWP BUILDING 3 LLC and the Registrant					X
10.3	Sixth Amendment of Lease dated October 18, 2023 between NWP BUILDING 4 LLC and the Registrant					X
10.4	Eighth Amendment of Lease dated October 18, 2023 between NWP BUILDING 5 LLC and the Registrant					X
31.1	Certification of Chief Executive Officer, as required by Rule13a-14(a) or Rule~~15d-14(a)~~ 15 d-14(a).								X
31.2
~~31.2~~		Certification of Chief Financial Officer, as required by Rule13a-14(a) or Rule15d-14(a).								X
32.1
~~32.1~~		Certification by the Chief Executive Officer, as required by Rule13a-14(b) or Rule15d-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. §1350).*								X
32.2
~~32.2~~		Certification by the Chief Financial Officer, as required by Rule13a-14(b) or Rule15d-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. §1350).*					X
101.INS	Inline XBRL Instance Document.					X
101.SCH
~~101.INS~~		~~XBRL Instance Document.~~								X

~~101.SCH~~		Inline XBRL Taxonomy Extension Schema Document.								X
101.CAL
~~101.CAL~~		Inline XBRL Taxonomy Extension Calculation Linkbase Document.								X
101.DEF
~~101.DEF~~		Inline XBRL Taxonomy Extension Definition Linkbase Document.								X
101.LAB
~~101.LAB~~		Inline XBRL Taxonomy Extension Label Linkbase Document.								X
101.PRE
~~101.PRE~~		Inline XBRL Taxonomy Extension Presentation Linkbase Document.					X
				X
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).					X

+ †	Indicates a management contract or any compensatory plan, contract, or arrangement.

The certifications attached as Exhibit 32.1 and Exhibit 32.2 that accompany this Quarterly Report on Form10-Q, are not deemed filed with the SEC and are not to be incorporated by reference into any filing of LeMaitre Vascular, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Quarterly Report on Form10-Q, irrespective of any general incorporation language contained in such filing.

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on November ~~3, 2017.~~7, 2023.


LEMAITRE VASCULAR, INC.

/s/ George W. LeMaitre
George W. LeMaitre
Chairman and Chief Executive Officer

/s/ Joseph P. Pellegrino, Jr.
Joseph P. Pellegrino, Jr.
Chief Financial Officer and Director

~~EXHIBIT INDEX~~


		~~Incorporated by Reference~~
~~Exhibit~~ ~~Number~~	~~Exhibit Description~~	~~Form~~	~~Date~~	~~Number~~	~~Filed~~ ~~Herewith~~

~~31.1~~	~~Certification of Chief Executive Officer, as required by Rule13a-14(a)~~ ~~or Rule15d-14(a).~~				X

~~31.2~~	~~Certification of Chief Financial Officer, as required by Rule13a-14(a)~~ ~~or Rule15d-14(a).~~				X

~~32.1~~	~~Certification by the Chief Executive Officer, as required by Rule13a-14(b)~~ ~~or Rule15d-14(b)~~ and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. §1350).*				X

~~32.2~~	~~Certification by the Chief Financial Officer, as required by Rule13a-14(b)~~ ~~or Rule15d-14(b)~~ and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. §1350).*				X

~~101.INS~~	~~XBRL Instance Document.~~				X

~~101.SCH~~	~~XBRL Taxonomy Extension Schema Document.~~				X

~~101.CAL~~	~~XBRL Taxonomy Extension Calculation Linkbase Document.~~				X

~~101.DEF~~	~~XBRL Taxonomy Extension Definition Linkbase Document.~~				X

~~101.LAB~~	~~XBRL Taxonomy Extension Label Linkbase Document.~~				X

~~101.PRE~~	~~XBRL Taxonomy Extension Presentation Linkbase Document.~~				X

+	~~Indicates a management contract or any compensatory plan, contract, or arrangement.~~

~~The certifications attached as Exhibit 32.1 and Exhibit 32.2 that accompany this Quarterly Report on Form10-Q,~~ are not deemed filed with the SEC and are not to be incorporated by reference into any filing of LeMaitre Vascular, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Quarterly Report on Form~~10-Q,~~ ~~irrespective of any general incorporation language contained in such filing.~~


63 Second Avenue, Burlington, Massachusetts		01803
(Address of principal executive offices)		(Zip Code)


Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐
		~~Accelerated filer~~
		☒

~~Non-accelerated~~ ~~filer~~		~~☐ (Do not check if a smaller reporting company)~~		~~Smaller reporting company~~		☐

				Emerging growth company	☐	☐

							(unaudited)
	(unaudited)						September 30,			December 31,
	September 30, 2017			December 31, 2016			2023			2022
	(in thousands, except share data)						(in thousands, except share data)
Assets
Current assets:
Cash and cash equivalents	$	37,514		$	24,288		$	18,051		$	19,134
Accounts receivable, net of allowances of $315 at September 30, 2017, and $258 at December 31, 2016		13,553			13,191
Short-term marketable securities								78,967			63,557
Accounts receivable, net of allowances of $863 at September 30, 2023 and $835 at December 31, 2022								23,882			22,040
Inventory and other deferred costs		21,095			19,578			56,187			50,271
Prepaid expenses and other current assets		3,480			1,970			5,097			6,731
Total current assets								182,184			161,733

Total current assets		75,642			59,027
Property and equipment, net		11,367			8,012			21,357			17,901
Right-of-use leased assets								15,850			15,634
Goodwill		23,850			23,426			65,945			65,945
Other intangibles, net		8,669			9,897			43,199			46,527
Deferred tax assets		1,562			1,399			2,325			1,745
Other assets		179			163			3,152			991

Total assets	$	121,269		$	101,924		$	334,012		$	310,476

Liabilities and stockholders’ equity
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	1,617		$	1,217		$	4,371		$	2,903
Accrued expenses		8,803			8,804			21,788			19,967
Acquisition-related obligations		1,690			461			121			573
Lease liabilities - short-term								2,749			1,886
Total current liabilities								29,029			25,329

Total current liabilities		12,110			10,482
Lease liabilities - long-term								14,132			14,710
Deferred tax liabilities		1,948			1,941			69			69
Other long-term liabilities		1,098			2,001			2,145			2,167
Total liabilities								45,375			42,275

Total liabilities		15,156			14,424
Stockholders’ equity:
Preferred stock, $0.01 par value; authorized 3,000,000 shares; none outstanding		—			—			-			-
Common stock, $0.01 par value; authorized 37,000,000 shares; issued 20,742,411 shares at September 30, 2017, and 20,040,348 shares at December 31, 2016		207			200
Common stock, $0.01 par value; authorized 37,000,000 shares; issued 23,835,670 shares at September 30, 2023, and 23,655,716 shares at December 31, 2022								239			237
Additionalpaid-in capital		92,685			85,378			198,254			189,268
Retained earnings		25,109			15,335			110,081			97,773
Accumulated other comprehensive loss		(2,280	)		(4,583	)		(6,705	)		(6,031	)
Treasury stock, at cost; 1,480,101 shares at September 30, 2017 and 1,452,810 shares at December 31, 2016		(9,608	)		(8,830	)

Treasury stock, at cost; 1,572,435 shares at September 30, 2023 and 1,568,595 shares at December 31, 2022								(13,232	)		(13,046	)
Total stockholders’ equity		106,113			87,500			288,637			268,201

Total liabilities and stockholders’ equity	$	121,269		$	101,924		$	334,012		$	310,476

													Three months ended						Nine months ended
													September 30,						September 30,
	Three months ended September 30,						Nine months ended September 30,						2023			2022			2023			2022
	2017			2016			2017			2016			(in thousands, except per share data)						(in thousands, except per share data)
	(in thousands, except per share data)
Net sales	$	24,822		$	23,216		$	74,714		$	65,863		$	47,411		$	39,028		$	144,601		$	120,697
Cost of sales		7,245			6,197			22,269			19,121			16,596			13,958			50,817			41,855

Gross profit		17,577			17,019			52,445			46,742			30,815			25,070			93,784			78,842

Sales and marketing		6,201			6,541			19,754			19,353			9,673			8,229			30,786			24,321
General and administrative		4,562			3,595			12,857			10,343			7,738			7,229			23,392			21,812
Research and development		1,761			1,539			5,053			4,619			4,224			3,462			12,615			9,740
Restructuring														-			-			485			3,107

Total operating expenses		12,524			11,675			37,664			34,315			21,635			18,920			67,278			58,980

Income from operations		5,053			5,344			14,781			12,427			9,180			6,150			26,506			19,862

Other income (expense):
Interest income		48			24			100			55			835			264			2,085			539
Foreign currency gain (loss)		(28	)		(61	)		(103	)		(74	)
Foreign currency loss														(189	)		(266	)		(429	)		(709	)

Income before income taxes		5,073			5,307			14,778			12,408			9,826			6,148			28,162			19,692
Provision for income taxes		31			2,078			1,885			4,415			2,324			692			6,522			4,683

Net income	$	5,042		$	3,229		$	12,893		$	7,993		$	7,502		$	5,456		$	21,640		$	15,009

Earnings per share of common stock:
Basic	$	0.26		$	0.17		$	0.68		$	0.43		$	0.34		$	0.25		$	0.97		$	0.68

Diluted	$	0.25		$	0.17		$	0.65		$	0.42		$	0.33		$	0.25		$	0.97		$	0.68

Weighted-average shares outstanding:
Basic		19,124			18,524			18,859			18,423			22,263			21,984			22,196			21,959

Diluted		20,147			19,248			19,970			19,103			22,481			22,217			22,411			22,149

Cash dividends declared per common share	$	0.055		$	0.045		$	0.165		$	0.135		$	0.140		$	0.125		$	0.420		$	0.375

									Three months ended						Nine months ended
	Three months ended September 30,				Nine months ended September 30,				September 30,						September 30,
	2017		2016		2017		2016		2023			2022			2023			2022
	(in thousands)								(in thousands)						(in thousands)
Net income	$	5,042	$	3,229	$	12,893	$	7,993	$	7,502		$	5,456		$	21,640		$	15,009
Other comprehensive income (loss):
Foreign currency translation adjustment, net		664		312		2,303		836		(833	)		(1,350	)		(492	)		(2,876	)

Total other comprehensive income (loss)		664		312		2,303		836
Unrealized loss on short-term marketable securities										(50	)		(333	)		(182	)		(1,816	)
Total other comprehensive loss										(883	)		(1,683	)		(674	)		(4,692	)

Comprehensive income	$	5,706	$	3,541	$	15,196	$	8,829	$	6,619		$	3,773		$	20,966		$	10,317

								Page
				~~Page~~
Part I.			Financial Information:						4
		~~Item 1.~~		~~Financial Statements~~
				~~Consolidated Balance Sheets as of September 30, 2017 (unaudited) and December 31, 2016~~			3
			Item 1.	Financial Statements	4

				Consolidated Balance Sheets as of September 30, 2023 (unaudited) and December 31, 2022	4

			Unaudited Consolidated Statements of Operations for the three-month and nine-month periods ended September 30, ~~2017~~2023 and ~~2016~~2022	5
			4
		Unaudited Consolidated Statements of Comprehensive Income for the three-month and nine-month periods ended September 30, ~~2017~~2023 and ~~2016~~2022	6
		5
		Unaudited Consolidated Statements of ~~Cash Flows~~Stockholders’ Equity for the three-month and nine-month periods ended September 30, ~~2017~~2023 and ~~2016~~2022	7
		6
		Unaudited Consolidated Statements of Cash Flows for the nine-month periods ended September 30, 2023 and 2022	9

		Notes to Unaudited Consolidated Financial Statements	10
		7
	Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
		19
	Item 3.		Quantitative and Qualitative Disclosure about Market Risk	32
			29
		Item 4.		Controls and Procedures	32
		30
Part II.			Other Information:
		~~Item 1.~~		~~Legal Proceedings~~34
			30
		Item ~~1A.~~	1.	~~Risk Factors~~Legal Proceedings	34
			31
		Item 2.1A.	Risk Factors	34

	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	36
		31
	Item 6.	5.	~~Exhibits~~Other Information	36
			32
	Item 6.	Exhibits	37

	Signatures				33	38
	~~Index to Exhibits~~

										Accumulated
					Additional					Other								Total
	Common Stock				Paid-in		Retained			Comprehensive			Treasury Stock					Stockholders’
	Shares		Amount		Capital		Earnings			Income (Loss)			Shares		Amount			Equity

Balance at December 31, 2022		23,655,716	$	237	$	189,268	$	97,773		$	(6,031	)		1,568,595	$	(13,046	)	$	268,201

Net income								6,040											6,040
Other comprehensive income (loss)											459								459
Issuance of common stock for stock options exercised		50,424		1		1,445													1,446
Vested restricted stock units		8,773		-		-													-
Stock-based compensation expense						1,290													1,290
Repurchase of common stock for net settlement of equity awards														3,602		(172	)		(172	)
Common stock dividend paid								(3,099	)										(3,099	)
Balance at March 31, 2023		23,714,913		238		192,003		100,714			(5,572	)		1,572,197		(13,218	)		274,165

Net income								8,098											8,098
Other comprehensive income (loss)											(250	)							(250	)
Issuance of common stock for stock options exercised		120,179		1		3,626													3,627
Vested restricted stock units		399		-		-													-
Stock-based compensation expense						1,312													1,312
Repurchase of common stock for net settlement of equity awards														151		(9	)		(9	)
Common stock dividend paid								(3,116	)										(3,116	)
Balance at June 30, 2023		23,835,491	$	239	$	196,941	$	105,696		$	(5,822	)		1,572,348	$	(13,227	)	$	283,827

Net income								7,502											7,502
Other comprehensive income (loss)											(883	)							(883	)
Issuance of common stock for stock options exercised		-		-		-													-
Vested restricted stock units		179		-		-													-
Stock-based compensation expense						1,313													1,313
Repurchase of common stock for net settlement of equity awards														87		(5	)		(5	)
Common stock dividend paid								(3,117	)										(3,117	)
Balance at September 30, 2023		23,835,670	$	239	$	198,254	$	110,081		$	(6,705	)		1,572,435	$	(13,232	)	$	288,637

							For the nine months ended
	For the nine months ended September 30,						September 30,
	2017			2016			2023			2022
	(in thousands)						(in thousands)
Operating activities
Net income	$	12,893		$	7,993		$	21,640		$	15,009
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		2,966			2,658			7,072			7,145
Stock-based compensation		1,845			1,195			3,915			3,489
Provision for (recovery of) doubtful accounts		152			52
Fair value adjustment to contingent consideration obligations								(49	)		(81	)
Provision for credit losses								60			214
Provision for inventory write-downs		272			280			1,455			2,060
Foreign currency transaction loss		(34	)		(1	)
Loss on disposal of property and equipment								-			95
Loss on divestitures								485			1,406
Foreign currency transaction (gain) loss								(7	)		(90	)
Changes in operating assets and liabilities:
Accounts receivable		(50	)		(68	)		(2,077	)		(1,737	)
Inventory and other deferred costs		(1,330	)		(216	)		(7,582	)		(5,041	)
Prepaid expenses and other assets		(1,403	)		(390	)		(1,160	)		(1,344	)
Accounts payable and other liabilities		787			1,199			2,253			176
Net cash provided by operating activities								26,005			21,301

Net cash provided by operating activities		16,098			12,702
Investing activities
Purchases of property and equipment and other assets		(4,780	)		(1,830	)		(5,986	)		(1,969	)
Payments related to acquisitions		—			(2,368	)		(899	)		-
Purchases of short-term marketable securities								(15,569	)		(8,000	)
Net cash used in investing activities								(22,454	)		(9,969	)

Net cash used in investing activities		(4,780	)		(4,198	)
Financing activities
Payments of deferred acquisition consideration		(427	)		(249	)		-			(401	)
Proceeds from issuance of common stock		5,470			1,384			5,073			1,679
Purchase of treasury stock		(778	)		(183	)
Purchase of treasury stock for net settlement of equity awards								(186	)		(152	)
Common stock cash dividend paid		(3,119	)		(2,487	)		(9,332	)		(8,238	)
Net cash used in financing activities								(4,445	)		(7,112	)

Net cashprovidede by (used in) financing activities		1,146			(1,535	)
Effect of exchange rate changes on cash and cash equivalents		762			230			(189	)		(1,162	)

Net increase in cash and cash equivalents		13,226			7,199
Net increase (decrease) in cash and cash equivalents								(1,083	)		3,058
Cash and cash equivalents at beginning of period		24,288			27,451			19,134			13,855

Cash and cash equivalents at end of period	$	37,514		$	34,650		$	18,051		$	16,913

Supplemental disclosures of cash flow information (see Note 11)

	Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
	($ in thousands)				($ in thousands)

Americas	$	31,863	$	26,627	$	97,496	$	82,024
Europe, Middle East and Africa		12,322		9,922		38,179		31,165
Asia Pacific		3,226		2,479		8,926		7,508
Total	$	47,411	$	39,028	$	144,601	$	120,697


	Nine months ended September 30, 2017
	(in thousands)
Unrecognized tax benefits as of December 31, 2016	$	390
Additions for tax positions of current year		66
Additions for tax positions of prior years		—
Reductions for settlements with taxing authorities.		—
Reductions for lapses of the applicable statutes of limitations		(5	)

Unrecognized tax benefits as of September 30, 2017	$	451

	Nine months ended September 30, 2023
	(in thousands)
Unrecognized tax benefits as of December 31, 2022	$	612
Additions/adjustments for tax positions of current year		-
Additions/adjustments for tax positions of prior years		(43	)
Reductions for settlements with taxing authorities		-
Reductions for lapses of the applicable statutes of limitations		-
Unrecognized tax benefits as of September 30, 2023	$	569


United States		~~2014~~ 2019 and forward
Foreign		~~2010~~ 2015 and forward


	September 30, 2017		December 31, 2016		September 30, 2023		December 31, 2022
	(in thousands)				(in thousands)
Raw materials	$	3,657	$	2,810	$	19,137	$	14,929
Work-in-process		3,491		2,489		3,793		3,662
Finished products		11,944		11,662		28,334		26,688
Other deferred costs		2,003		2,617		4,923		4,992

Total inventory and other deferred costs	$	21,095	$	19,578	$	56,187	$	50,271


	Allocated Fair Value
	(in thousands)
Accounts receivable	$	394
Deferred cryopreservation costs		2,583
Equipment and supplies		125
Accounts payable		(286	)
Intangible assets		4,544
Goodwill		5,599

Purchase price	$	12,959


	Allocated Fair Value		Weighted Average Useful Life
	(in thousands)
Non-compete agreement	$	180		5.0 years
Tradename		271		9.0 years
Procurement contracts		617		9.0 years
Technology		2,793		10.5 years
Customer relationships		683		12.5 years

Total intangible assets	$	4,544

													September 30, 2023						December 31, 2022
	September 30, 2017						December 31, 2016						Gross				Net		Gross				Net
	Gross Carrying Value		Accumulated Amortization		Net Carrying Value		Gross Carrying Value		Accumulated Amortization		Net Carrying Value		Carrying		Accumulated		Carrying		Carrying		Accumulated		Carrying
	(in thousands)												Value		Amortization		Value		Value		Amortization		Value
Product technology	$	10,271	$	4,694	$	5,577	$	10,173	$	4,017	$	6,156
Trademarks and licenses		1,949		1,445		504		1,939		1,359		580
													(in thousands)
Product technology and intellectual property													$	29,549	$	15,381	$	14,168	$	29,549	$	13,319	$	16,230
Trademarks, tradenames and licenses														3,767		1,870		1,897		3,647		1,533		2,114
Customer relationships		5,372		3,142		2,230		5,216		2,588		2,628		37,171		10,341		26,830		36,197		8,359		27,838
Other intangible assets		1,574		1,216		358		1,558		1,025		533		1,643		1,339		304		1,461		1,116		345

Total identifiable intangible assets	$	19,166	$	10,497	$	8,669	$	18,886	$	8,989	$	9,897	$	72,130	$	28,931	$	43,199	$	70,854	$	24,327	$	46,527

	Year ended December 31,
	2023		2024		2025		2026		2027		2028
	(in thousands)

Amortization expense	$	1,488	$	5,904	$	5,554	$	5,119	$	4,842	$	4,456


	Allocated Fair Value
	(in thousands)
Inventory	$	2,080
Manufacturing equipment and supplies		25
Intangible assets		620
Goodwill		318

Purchase price	$	3,043


	(in thousands)
Balance at December 31, 2016	$	23,426
Purchase accounting adjustments		257
Effects of currency exchange		167

Balance at September 30, 2017	$	23,850

Location (leases)	Purpose	Approx. Sq. Ft.		Expiration

Americas
Burlington, MA (5)	Corporate headquarters, manufacturing and distribution		109,354	December 2030
North Brunswick, NJ (1)	Artegraft biologic business		16,732	October 2029
Fox River Grove, IL (3)	RestoreFlow allografts business		11,765	November 2025
Vaughn, Canada	Canada sales office and distribution		3,192	February 2026
Chandler, Arizona	US sales office		2,058	August 2025

Europe, Middle East and Africa
Sulzbach, Germany	European headquarters and distribution		21,410	June 2031
Milan,Italy	Italy sales office and distribution		5,705	July 2027
Hereford, England	United Kingdom sales office and distribution		3,575	October 2029
Madrid, Spain	Spain sales office		2,260	June 2029

Asia Pacific
Singapore	Asia Pacific headquarters and distribution		1,270	June 2024
Tokyo, Japan	Japan sales office and distribution		4,236	July 2025
Bangkok, Thailand	Thailand sales office and distribution		2,810	August 2026
Seoul, Korea	Korea sales office and distribution		2,300	April 2027
Shanghai, China	China sales office and distribution		1,152	August 2024
Ballarat, Australia	Supply facility	Up to 350 acres		December 2030


	Three months ended September 30,				Nine months ended September 30,
	2017		2016		2017		2016
	(in thousands)
Amortization expense	$	443	$	385	$	1,353	$	1,170

	Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023			2022
	(in thousands)		(in thousands)		(in thousands)			(in thousands)

Lease cost
Operating lease cost	$	797	$	792	$	1,941		$	1,955
Short-term lease cost		28		154		348			478
Total lease cost	$	825	$	946	$	2,289		$	2,433

Other information
Cash paid for amounts included in the measurement of operating lease liabilities	$	967	$	977	$	2,433		$	2,461

Right-of-use assets obtained in exchange for new operating lease liabilities	$	843	$	287	$	2,156		$	2,669


Weighted average remaining lease term - operating leases (in years)						6.7			8.2

Weighted average discount rate - operating leases						5.15	%		4.93	%

Remainder of 2023	$	880
Year ending December 31,
2024		3,502
2025		3,314
2026		2,647
2027		2,482
2028		2,452
Thereafter		4,610
Adjustment to net present value as of September 30, 2023		(3,006	)

Minimum noncancelable lease liability	$	16,881


	2016
Dividend yield		1.3	%
Volatility		34.5	%
Risk-free interest rate		1.2	%
Weighted average expected option term (in years)		5.5
Weighted average fair value per share of options granted	$	4.04


Record Date	Payment Date		Per Share Amount		Dividend Payment
					(in thousands)
Fiscal Year 2017
March 22, 2017		April 6, 2017	$	0.055	$	1,029
May 24, 2017		June 8, 2017	$	0.055	$	1,036
August 23, 2017		September 6, 2017	$	0.055	$	1,055
Fiscal Year 2016
March 21, 2016		April 4, 2016	$	0.045	$	825
May 25, 2016		June 8, 2016	$	0.045	$	829
August 22,2016		September 2, 2016	$	0.045	$	833
November 21, 2016		December 5, 2016	$	0.045	$	836

	For the nine months ended
	September 30,
	2023		2022
	(in thousands)
Cash paid for income taxes, net	$	5,420	$	6,822

	•	growing our direct sales force in the United States, Europe, the United Kingdom, Canada and Asia Pacific, including replacing distributors with our direct sales personnel;

	•	increasing the average selling prices of our devices;

	•	adding complementary products through acquisitions;

	•	introducing our products into new territories upon receipt of regulatory approvals or registrations;

	•	consolidating and automating product manufacturing at our Burlington, Massachusetts facilities; and

	•	updating existing products and introducing new products through research and development.

	•	In October 2019, we entered into an agreement with Anteris to purchase the assets of their CardioCel biologic patch business for $15.5 million plus additional payments of up to $7.8 million, depending upon the satisfaction of certain contingencies.

	•	In June 2020, we entered into an agreement with Artegraft to purchase the assets of their bovine graft business for $72.5 million plus additional payments of up to $17.5 million, depending upon 2021 – 2023 unit sales.

	•	During 2021, we made decisions to wind down or discontinue TRIVEX powered phlebectomy systems, remote endarterectomy devices and surgical glue. These products totaled approximately $2.2 million in 2021 revenues.

	•	During 2022, we made the decision to wind down the ProCol graft, AlboSure polyester patch, LeverEdge and Latis graft cleaning catheter product lines. These products totaled approximately $0.7 million in 2022 revenues.

	•	During 2023, we made the decision to discontinue the sales of AlboGraft and LifeSpan synthetic graft product lines in the United States. These products totaled approximately $0.2 million and less than $0.1 million, respectively, in 2022 revenues.

	•	In May 2022, we entered into a distribution transition agreement with our Korean distributor in order to sell products directly in Korea and dissolve the existing distribution arrangement. We have been selling direct-to-hospital in Korea since December 2022. The distribution termination fees totaled approximately $0.5 million.

	•	In March 2023, we entered into a distribution transition agreement with our Thailand distributor in order to sell products directly in Thailand and dissolve the existing distribution arrangement. The distribution termination fees will total approximately $0.7 million. We began selling direct-to-hospital in Thailand in Q3 2023.

	•	In 2020, we launched RestoreFlow cardiac allografts for use in cardiac repair and restoration.

	•	In March 2022, we received U.S. FDA clearance to market PhasTIPP, a portable powered phlebotomy device used to remove varicose veins in the leg. We expect to launch this product in 2024.


	Three months ended Sept ember 30,							Nine months ended September 30,							Three months ended September 30,							Nine months ended September 30,
(unaudited)	2017		2016		Percent change			2017		2016		Percent change							Percent							Percent
	($ in thousands)														2023		2022		change			2023		2022		change
															($ in thousands)							($ in thousands)
Net sales	$	24,822	$	23,216		7	%	$	74,714	$	65,863		13	%	$	47,411	$	39,028		21	%	$	144,601	$	120,697		20	%

Net sales by geography:
Americas	$	15,442	$	14,528		6	%	$	46,511	$	39,594		17	%	$	31,863	$	26,627		20	%	$	97,496	$	82,024		19	%
International		9,380		8,688		8	%		28,203		26,269		7	%

Europe, Middle East and Africa																12,322		9,922		24	%		38,179		31,165		23	%
Asia Pacific																3,226		2,479		30	%		8,926		7,508		19	%
Total	$	24,822	$	23,216		7	%	$	74,714	$	65,863		13	%	$	47,411	$	39,028		21	%	$	144,601	$	120,697		20	%


	Three months ended September 30,									Nine months ended September 30,
	2017 % of Net Sales			2016 % of Net Sales			Change			2017 % of Net Sales			2016 % of Net Sales			Change
Sales and marketing		25	%		28	%		(3	%)		26	%		29	%		(3	%)
General and administrative		18	%		15	%		3	%		17	%		16	%		1	%
Research and development		7	%		7	%		0	%		7	%		7	%		0	%