Financial Data and Key Metrics Changes - Revenue for Q2 2025 was $56.7 million, reflecting an 18.3% increase compared to Q2 2024 and a 16.7% sequential increase over Q1 2025 [5][18] - Gross profit for the quarter was $42 million, up from $35.3 million in Q2 2024, representing a gross margin of 74.2%, an increase from 73.8% in the same period last year [18][19] - Net income for the quarter was $600,000 or $0.01 per share, compared to a net loss of $1.9 million or $0.04 per share in Q2 2024 [21] Business Line Data and Key Metrics Changes - Sales growth was driven by double-digit growth across all nerve repair target markets, including extremities, oral, maxillofacial, head and neck, and breast [5][6] - The advanced nerve graft remains the primary growth driver, complemented by other nerve repair products [6] - High potential accounts contributed approximately 70% of revenue growth in the first half of 2025, with 641 active high potential accounts, an increase of 19 accounts or 3% compared to 2024 [8][9] Market Data and Key Metrics Changes - Coverage for nerve repair using synthetic conduits or allografts has increased to over 55% among commercial payers, with an estimated 17 million additional lives covered year to date [13] - The company expects to achieve nearly complete commercial coverage over the strategic plan period, with significant progress noted in the healthcare climate in the U.S. [40][41] Company Strategy and Development Direction - The company is focused on executing its strategic plan, investing in innovation, optimizing resource allocation, and driving towards profitability [23] - The Biologics License Application (BLA) for the advanced nerve graft is on track for anticipated approval in September 2025, which will secure 12 years of market exclusivity [16][17] - The company aims to double its breast sales force by the end of 2025, targeting 22 representatives and two regional sales directors [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to grow the business consistent with previously provided guidance, despite potential deceleration in the second half of the year due to BLA logistics [32] - The leadership team believes that the treatment penetration of nerve care is still low, indicating significant growth opportunities [28][29] - The company remains focused on maintaining operational efficiency and leveraging improvements post-BLA approval [56] Other Important Information - Operating expenses increased to $40.3 million, but as a percentage of revenue, they decreased by 3.5%, indicating improved operating leverage [20] - The company expects to be net cash flow positive for the year and to self-fund its strategic plan with growing cash from operations [22][23] Q&A Session Summary Question: Insights on business progress in the first half of the year - Management noted that growth is driven by effective sales management and strategies to increase adoption of nerve care [26][27] Question: Dynamics for the second half of the year - Management indicated a conservative approach until the BLA process is finalized, which may affect logistics and product supply [32] Question: Sales rep productivity and seasonal trends - Management expects historical seasonality to continue, with specific increases in procedures during favorable weather and year-end [36] Question: Coverage expansion and its drivers - Management highlighted the importance of updated evidence and clinician advocacy in driving coverage expansion [40][41] Question: BLA process and interactions with the FDA - Management described the interactions as professional and cooperative, with ongoing discussions about quality systems and labeling [46][82] Question: Manufacturing improvements post-BLA approval - Management outlined plans for continuous improvement processes and electronic systems to enhance operational efficiency [56] Question: Gross margin changes and future write-offs - Management indicated that while there may be future write-offs, they do not foresee significant issues at the moment [92]

Financial Performance - Q2 2025 revenue increased to $56.7 million, representing an 18.3% year-over-year growth[12,22] - Q2 2025 gross margin was 74.2%, a 0.4% increase compared to 2024[24] - Net income for Q2 2025 was $0.6 million, compared to a loss of $1.9 million in Q2 2024[26] - Adjusted EBITDA for Q2 2025 was $9.3 million, compared to $5.6 million in Q2 2024[26] - Operational cash flow increased by $7.8 million, from $28.1 million on March 31, 2025, to $35.9 million on June 30, 2025[28] Business Growth & Development - High Potential (HiPo) accounts yielded approximately 70% of year-over-year revenue growth year-to-date[12] - HiPo accounts have yielded a 21% year-over-year increase in average account productivity year-to-date[12] - The company added approximately 10 million estimated additional covered lives in Q2 via BCBS policy changes, with approximately 17 million estimated new lives year-to-date[14] Guidance - The company raised its full-year 2025 revenue growth guidance to at least 17%, or $219 million[30]

[Executive Summary](index=1&type=section&id=Executive%20Summary) Axogen, Inc. reported strong second quarter 2025 financial results, with significant revenue growth and a shift to net income. The company raised its full-year revenue guidance to at least 17% growth, or $219 million, reflecting confidence in its market development strategies and commercial execution - Axogen reported strong Q2 2025 results, with revenue growth and a **Shift to profit**, and raised full-year revenue guidance to at least **17% growth** or **$219 million**[1](index=1&type=chunk)[3](index=3&type=chunk) [Second Quarter 2025 Financial Results](index=1&type=section&id=Second%20Quarter%20Financial%20Results) Axogen achieved robust financial performance in Q2 2025, marked by double-digit revenue growth, improved gross margin, and a return to net income compared to a net loss in the prior year. Adjusted financial metrics also showed significant improvement [Key Financial Metrics](index=1&type=section&id=Key%20Financial%20Metrics) In Q2 2025, Axogen's revenue increased by 18.3% year-over-year to $56.7 million, with gross margin improving to 74.2%. The company reported a net income of $0.6 million ($0.01 per share) and adjusted net income of $5.7 million ($0.12 per share), a substantial improvement from a net loss in Q2 2024. Adjusted EBITDA also grew significantly to $9.3 million Key Financial Metrics | Metric | Q2 2025 | Q2 2024 | Change (YoY) | Q1 2025 | Change (QoQ) | | :----- | :------ | :------ | :----------- | :------ | :----------- | | Revenue | $56.7M | $47.9M | +18.3% | N/A | +16.7% (vs Q1 2025) | | Gross Margin | 74.2% | 73.8% | +0.4 pp | 71.9% | +2.3 pp | | Net Income (Loss) | $0.6M | ($1.9M) | Shift to profit | N/A | N/A | | Net Income (Loss) per share | $0.01 | ($0.04) | Shift to profit | N/A | N/A | | Adjusted Net Income | $5.7M | $2.0M | +185% | N/A | N/A | | Adjusted Net Income per share | $0.12 | $0.05 | +140% | N/A | N/A | | Adjusted EBITDA | $9.3M | $5.6M | +66.1% | N/A | N/A | - Cash and cash equivalents, restricted cash, and investments increased **$7.8 million** during the second quarter of 2025, reaching **$35.9 million** at June 30, 2025, compared to **$39.5 million** at December 31, 2024[5](index=5&type=chunk) [Business Highlights](index=1&type=section&id=Summary%20of%20Business%20Highlights) Axogen's Q2 2025 business highlights include broad-based revenue growth across all key markets and significant progress in expanding coverage and reimbursement for nerve repair solutions. The company also advanced its Biologics License Application (BLA) for Avance® Nerve Graft, completing critical regulatory milestones [Market Development and Commercial Execution](index=1&type=section&id=Market%20Development%20and%20Commercial%20Execution) Axogen achieved double-digit revenue growth across all its markets, including Extremities, Oral Maxillofacial & Head and Neck, and Breast. The company also expanded coverage and reimbursement for nerve repair, adding an estimated 10 million new covered lives in 2025, bringing the total to approximately 17 million new lives and over 55% commercial payer coverage - Second quarter 2025 revenue growth was broad-based, with double-digit growth from Q2 2024 in all markets: Extremities, Oral Maxillofacial & Head and Neck, and Breast[6](index=6&type=chunk) - Expanded coverage and reimbursement for nerve repair by an estimated **10 million new covered lives** in 2025, totaling approximately **17 million new lives** and bringing **commercial payer coverage to more than 55%**[6](index=6&type=chunk) [Regulatory Milestones](index=2&type=section&id=Regulatory%20Milestones) The FDA accepted Axogen's Biologics License Application (BLA) for Avance® Nerve Graft on November 1, 2024, with a Prescription Drug User Fee Act (PDUFA) goal date of September 5, 2025. During Q2 2025, Axogen completed key regulatory steps, including the late-cycle meeting with the FDA, pre-licensing inspection, and sponsor inspection under the Bioresearch Monitoring program, supporting anticipated approval - FDA accepted the BLA for Avance® Nerve Graft on November 1, 2024, with a PDUFA goal date of September 5, 2025[7](index=7&type=chunk) - Completed key regulatory milestones in Q2 2025 for Avance® Nerve Graft BLA, including the late-cycle meeting, pre-licensing inspection, and sponsor inspection[7](index=7&type=chunk) [2025 Financial Guidance](index=2&type=section&id=2025%20Financial%20Guidance) Axogen has raised its full-year 2025 revenue guidance to at least 17% growth, or $219 million. The company maintains its gross margin expectation of 73% to 75%, noting a potential 1% negative impact from anticipated Avance® Nerve Graft BLA approval costs. Axogen also reiterates its expectation to be net cash flow positive for the full year - Full-year 2025 revenue guidance raised to at least **17% growth**, or **$219 million**[8](index=8&type=chunk) - Gross margin for the year is expected to be in the range of **73% to 75%**, with a **~1% negative impact** from anticipated Avance® Nerve Graft BLA approval costs[8](index=8&type=chunk) - Company expects to be **net cash flow positive** for the full year[8](index=8&type=chunk) [About Axogen](index=2&type=section&id=About%20Axogen) Axogen (NASDAQ: AXGN) is a leading company dedicated to the science, development, and commercialization of technologies for peripheral nerve regeneration and repair. The company aims to restore nerve function and improve quality of life for patients with peripheral nerve injuries through innovative, clinically proven, and economically effective solutions [Product Portfolio](index=2&type=section&id=Product%20Portfolio) Axogen's product portfolio includes a range of solutions for peripheral nerve repair and regeneration. Key products are Avance Nerve Graft (human nerve allograft), Axoguard Nerve Connector (coaptation aid), Axoguard Nerve Protector (nerve wrap), Axoguard HA+ Nerve Protector (next-gen nerve protector), Axoguard Nerve Cap (neuroma reduction), and Avive+ Soft Tissue Matrix (tissue protection). These products are available in the US, Canada, Germany, UK, Spain, South Korea, and other countries - Axogen's product portfolio includes Avance Nerve Graft, Axoguard Nerve Connector, Axoguard Nerve Protector, Axoguard HA+ Nerve Protector, Axoguard Nerve Cap, and Avive+ Soft Tissue Matrix[12](index=12&type=chunk) - Products are available in the United States, Canada, Germany, the United Kingdom, Spain, South Korea, and several other countries[12](index=12&type=chunk) [Non-GAAP Financial Measures](index=3&type=section&id=About%20Non-GAAP%20Financial%20Measures) Axogen uses non-GAAP financial measures such as EBITDA, Adjusted EBITDA, Adjusted Net Income/Loss, and Adjusted Net Income/Loss Per Common Share - diluted to supplement its GAAP financial statements. These measures exclude noncash stock compensation expense and other items to provide additional insights into the company's operational performance and facilitate period-to-period comparisons for management and investors - Non-GAAP measures include EBITDA, Adjusted EBITDA (excluding noncash stock compensation), and Adjusted Net Income/Loss (excluding noncash stock compensation)[14](index=14&type=chunk) - These non-GAAP measures are used for financial and operational decision-making, to evaluate period-to-period comparisons, and provide greater transparency for investors and analysts[15](index=15&type=chunk) [Financial Statements](index=4&type=section&id=Financial%20Statements) This section presents Axogen's unaudited condensed consolidated financial statements, including the Balance Sheets, Statements of Operations, Reconciliation of GAAP to Non-GAAP Measures, Statements of Changes in Shareholders' Equity, and Statements of Cash Flows for the periods ended June 30, 2025, and December 31, 2024 (for balance sheet) or June 30, 2024 (for income statement and cash flow) [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, Axogen's total assets increased slightly to $205.45 million from $203.73 million at December 31, 2024. Current assets rose to $103.42 million, driven by increases in investments and accounts receivable. Total liabilities decreased to $93.18 million from $99.82 million, while total shareholders' equity increased to $112.28 million from $103.91 million Condensed Consolidated Balance Sheets (in thousands) | Metric (in thousands) | June 30, 2025 | December 31, 2024 | Change | | :-------------------- | :------------ | :---------------- | :----- | | Total Assets | $205,453 | $203,728 | +$1,725 | | Total Current Assets | $103,419 | $99,217 | +$4,202 | | Cash and cash equivalents | $20,036 | $27,554 | -$7,518 | | Investments | $9,886 | $5,928 | +$3,958 | | Accounts receivable, net | $28,029 | $24,105 | +$3,924 | | Total Liabilities | $93,177 | $99,821 | -$6,644 | | Total Shareholders' Equity | $112,276 | $103,907 | +$8,369 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the three months ended June 30, 2025, Axogen reported revenues of $56.66 million, an 18.3% increase year-over-year. Gross profit rose to $42.02 million, and the company achieved a net income of $0.58 million, a significant improvement from a net loss of $1.92 million in Q2 2024. For the six months ended June 30, 2025, revenues were $105.22 million, and net loss decreased to $3.26 million from $8.56 million in the prior year period Condensed Consolidated Statements of Operations (in thousands) | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change (YoY) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change (YoY) | | :-------------------- | :------------------------------- | :------------------------------- | :----------- | :----------------------------- | :----------------------------- | :----------- | | Revenues | $56,662 | $47,912 | +18.3% | $105,222 | $89,289 | +17.8% | | Gross profit | $42,018 | $35,345 | +18.9% | $76,951 | $67,964 | +13.2% | | Income (loss) from operations | $1,672 | ($428) | Shift to profit | $11 | ($4,988) | Shift to profit | | Net income (loss) | $579 | ($1,921) | Shift to profit | ($3,255) | ($8,556) | Reduced loss | | Net income (loss) per common share — diluted | $0.01 | ($0.04) | Shift to profit | ($0.07) | ($0.20) | Reduced loss | [Reconciliation of GAAP to Non-GAAP Financial Measures](index=6&type=section&id=Reconciliation%20of%20GAAP%20Financial%20Measures%20to%20Non-GAAP%20Financial%20Measures) The reconciliation shows that for Q2 2025, Adjusted EBITDA was $9.26 million, up from $5.62 million in Q2 2024, and Adjusted Net Income was $5.75 million, a significant increase from $1.99 million in Q2 2024. For the six months ended June 30, 2025, Adjusted EBITDA was $12.14 million, and Adjusted Net Income was $4.82 million, compared to a loss in the prior year. These adjustments primarily account for noncash stock-based compensation expense Reconciliation of GAAP to Non-GAAP Financial Measures (in thousands) | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change (YoY) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change (YoY) | | :-------------------- | :------------------------------- | :------------------------------- | :----------- | :----------------------------- | :----------------------------- | :----------- | | Net income (loss) (GAAP) | $579 | ($1,921) | Shift to profit | ($3,255) | ($8,556) | Reduced loss | | EBITDA - non-GAAP | $4,091 | $1,717 | +138.3% | $4,059 | ($1,198) | Shift to profit | | Adjusted EBITDA - non-GAAP | $9,259 | $5,624 | +64.6% | $12,136 | $6,628 | +83.1% | | Adjusted net income (loss) - non-GAAP | $5,747 | $1,986 | +189.4% | $4,822 | ($730) | Shift to profit | | Adjusted net income (loss) per common share - diluted - non-GAAP | $0.12 | $0.05 | +140% | $0.10 | ($0.02) | Shift to profit | [Condensed Consolidated Statements of Changes in Shareholders' Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Shareholders'%20Equity) Axogen's total shareholders' equity increased from $103.91 million at December 31, 2024, to $112.28 million at June 30, 2025. This increase was primarily driven by stock-based compensation and proceeds from the exercise of stock options and ESPP stock purchases, partially offset by the net loss for the six-month period Condensed Consolidated Statements of Changes in Shareholders' Equity (in thousands) | Metric (in thousands) | June 30, 2025 | December 31, 2024 | Change | | :-------------------- | :------------ | :---------------- | :----- | | Total Shareholders' Equity | $112,276 | $103,907 | +$8,369 | | Stock-based compensation (6 months) | $8,077 | N/A | N/A | | Exercise of stock options and ESPP (6 months) | $3,547 | N/A | N/A | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash used in operating activities decreased to $5.45 million from $8.10 million in the prior year period, primarily due to a reduced net loss and higher stock-based compensation. Net cash used in investing activities increased to $5.61 million, mainly due to higher purchases of investments. Net cash provided by financing activities significantly increased to $3.54 million, driven by proceeds from stock option exercises and ESPP. Overall, there was a net decrease in cash and cash equivalents, and restricted cash of $7.52 million Condensed Consolidated Statements of Cash Flows (in thousands) | Metric (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change | | :-------------------- | :------------------------------- | :------------------------------- | :----- | | Net cash used in operating activities | ($5,449) | ($8,101) | -$2,652 (**less cash used**) | | Net cash used in investing activities | ($5,608) | ($4,484) | +$1,124 (**more cash used**) | | Net cash provided by financing activities | $3,539 | $748 | +$2,791 | | Net decrease in cash and cash equivalents, and restricted cash | ($7,518) | ($11,837) | -$4,319 (**less decrease**) | | Cash and cash equivalents, and restricted cash, end of period | $26,036 | $25,189 | +$847 | [Additional Information](index=2&type=section&id=Additional%20Information) This section provides important legal disclaimers regarding forward-looking statements, outlining potential risks and uncertainties that could cause actual results to differ materially from projections. It also includes details for the investor conference call and company contact information [Cautionary Statements Concerning Forward-Looking Statements](index=3&type=section&id=Cautionary%20Statements%20Concerning%20Forward-Looking%20Statements) This section highlights that the press release contains forward-looking statements based on management's current expectations, which are subject to various risks and uncertainties. These risks include leadership transitions, supply chain issues, inflation, hospital staffing, product development timelines, regulatory processes, financial performance, and geopolitical conflicts, as detailed in the company's Form 10-K. The company assumes no responsibility to update these statements - Statements are forward-looking and subject to risks including leadership transitions, supply chain issues, inflation, hospital staffing, product development, regulatory approvals, and geopolitical conflicts[13](index=13&type=chunk) - Actual results may differ materially from projections, and the company assumes no responsibility to publicly update or revise any forward-looking statements[13](index=13&type=chunk) [Conference Call & Contact Information](index=3&type=section&id=Conference%20Call) Axogen hosted a conference call and webcast for the investment community on August 5, 2025, at 8:00 a.m. ET. Replay information is available on the company's investor relations website. Contact information for investor relations is also provided - Conference call and webcast held on August 5, 2025, at 8:00 a.m. ET, with replay available on the company's investor website[9](index=9&type=chunk)[10](index=10&type=chunk) - Investor contact: InvestorRelations@axogeninc.com[16](index=16&type=chunk)

Core Insights - Axogen, Inc. has raised its full-year revenue guidance to at least 17% growth, equating to approximately $219 million [5] - The company reported strong second-quarter results, with revenue of $56.7 million, an 18.3% increase compared to the same quarter in 2024 [6][7] - The CEO expressed confidence in the company's strategic plan and market development objectives, emphasizing the goal of making peripheral nerve function restoration a standard of care [3] Financial Performance - Second-quarter revenue was $56.7 million, reflecting an 18.3% increase year-over-year and a 16.7% increase from the first quarter of 2025 [6][7] - Gross margin for the second quarter was 74.2%, up from 73.8% in the same quarter of 2024 [6] - Net income for the quarter was $0.6 million, or $0.01 per share, compared to a net loss of $1.9 million, or $0.04 per share, in the second quarter of 2024 [6][7] - Adjusted net income for the quarter was $5.7 million, or $0.12 per share, compared to $2.0 million, or $0.05 per share, for the same period in 2024 [6][7] Business Highlights - The company achieved broad-based revenue growth across all markets, including Extremities, Oral Maxillofacial & Head and Neck, and Breast [7] - Coverage and reimbursement for nerve repair using synthetic conduits or allografts expanded by an estimated 10 million new covered lives in 2025, totaling approximately 17 million new lives covered [7] - The FDA accepted the filing of the Biologics License Application for Avance® Nerve Graft, with a goal date for approval set for September 5, 2025 [7] Cash Position - As of June 30, 2025, the balance of cash and cash equivalents, restricted cash, and investments was $35.9 million, down from $39.5 million at the end of 2024 [6] - The company expects to be net cash flow positive for the full year [5]

Company Overview - Axogen, Inc. is a global leader in developing and marketing innovative surgical solutions for the restoration of peripheral nerve function [1] - The company focuses specifically on the science, development, and commercialization of technologies for peripheral nerve regeneration and repair [2] - Axogen's products address the needs of patients suffering from traumatic injuries or surgical procedures that impact peripheral nerve function [2] Product Portfolio - Axogen offers a comprehensive portfolio of products for peripheral nerve repair, including: - Avance Nerve Graft®, a biologically active processed human nerve allograft for bridging severed peripheral nerves [2] - Axoguard Nerve Connector®, a porcine submucosa extracellular matrix coaptation aid for tensionless repair of severed peripheral nerves [2] - Axoguard Nerve Protector®, a product used to wrap and protect damaged peripheral nerves [2] - Axoguard HA+ Nerve Protector™, designed to enhance nerve gliding and provide protection for peripheral nerve injuries [2] - Avive+ Soft Tissue Matrix™, a multi-layer amniotic membrane allograft for tissue protection during repair [2] - Axoguard Nerve Cap®, used to protect a peripheral nerve end and reduce the development of symptomatic neuroma [2] Market Presence - Axogen's products are available in multiple markets, including the United States, Canada, the United Kingdom, South Korea, and several European and international markets [2] - The company plays a vital role in addressing diverse patient needs in peripheral nerve repair across various applications and surgical specialties [2]

Company Overview - Axogen, Inc. (NASDAQ: AXGN) is a global leader in developing and marketing innovative surgical solutions for the restoration of peripheral nerve function [1][3] - The company focuses specifically on the science, development, and commercialization of technologies for peripheral nerve regeneration and repair [3] Product Portfolio - Axogen offers a comprehensive portfolio of products for peripheral nerve repair, including: - Avance Nerve Graft®, a biologically active processed human nerve allograft for bridging severed peripheral nerves [3] - Axoguard Nerve Connector®, a porcine submucosa extracellular matrix coaptation aid for tensionless repair of severed peripheral nerves [3] - Axoguard Nerve Protector®, a product used to wrap and protect damaged peripheral nerves [3] - Axoguard HA+ Nerve Protector™, designed to enhance nerve gliding and provide protection for peripheral nerve injuries [3] - Avive+ Soft Tissue Matrix™, a multi-layer amniotic membrane allograft for tissue repair [3] - Axoguard Nerve Cap®, used to protect a peripheral nerve end and reduce the development of symptomatic or painful neuroma [3] Market Applications - Axogen's products are utilized across various applications and surgical specialties, including: - Traumatic injuries, oral and maxillofacial surgery, breast reconstruction, and surgical treatment of pain [3] - The company addresses both scheduled procedures, such as nerve reconstruction after surgical removal of painful neuromas, and emergent procedures arising from injuries [3] Upcoming Financial Reporting - Axogen will report its 2025 second quarter financial results on August 5, 2025, before the market opens [1] - An investment-community conference call and webcast will follow the release at 8 a.m. ET [1]

AxoGen (AXGN) FY Conference June 11, 2025 02:00 PM ET Speaker0 All good? All right. Well, to everyone who was here today to learn a little bit about AxoGen. Just before I get started, just want to draw everyone's attention to our forward looking statements. You're familiar with these and we will certainly be making forward looking statements but we may or may not be updating these on a regular basis. So, little bit about me. My name is Mike Dale. I've been, as you can tell by my gray hair, around for a litt ...

Company Overview - Axogen, Inc. (NASDAQ: AXGN) is a leader in developing and marketing surgical solutions for peripheral nerve injuries [1][3] - The company focuses on the science, development, and commercialization of technologies for peripheral nerve regeneration and repair [3] - Axogen's products aim to restore peripheral nerve function and improve the quality of life for patients with nerve damage [3] Product Portfolio - Axogen offers a comprehensive portfolio of products for various applications, including traumatic injuries, oral and maxillofacial surgery, breast reconstruction, and pain treatment [3] - Key products include: - Avance Nerve Graft®: a processed human nerve allograft for bridging severed peripheral nerves [3] - Axoguard Nerve Connector®: an extracellular matrix coaptation aid for tensionless repair of severed nerves [3] - Axoguard Nerve Protector®: a product used to protect damaged nerves and reinforce reconstruction [3] - Axoguard HA+ Nerve Protector™: designed to enhance nerve gliding and provide protection for peripheral nerve injuries [3] - Avive+ Soft Tissue Matrix™: an amniotic membrane allograft for tissue protection during repair [3] - Axoguard Nerve Cap®: used to protect a peripheral nerve end and reduce the development of painful neuromas [3] Market Presence - Axogen's products are available in the United States, Canada, the United Kingdom, South Korea, and several other international markets [3] - The company addresses both scheduled and emergent procedures, highlighting its vital role in peripheral nerve repair [3]

Group 1 - AxoGen (AXGN) has experienced a significant downtrend, with a 25% decline in stock price over the past four weeks due to excessive selling pressure [1] - The stock is currently in oversold territory, indicated by an RSI reading of 28.96, suggesting a potential for a trend reversal [5] - Wall Street analysts have raised earnings estimates for AXGN by 9.1% over the last 30 days, indicating a positive outlook for the company's earnings [7] Group 2 - The Zacks Rank for AXGN is 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks, which supports the potential for a near-term turnaround [8]

[Part I - Financial Information](index=5&type=section&id=Part%20I%20-%20Financial%20Information) [Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) The company reported total assets of $196.2 million as of March 31, 2025, a decrease from $203.7 million at year-end 2024, with revenues of $48.6 million and a net loss of $3.8 million for the three months ended March 31, 2025 [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets were $196.2 million, a decrease from $203.7 million at December 31, 2024, primarily due to reduced cash and cash equivalents, while total liabilities decreased to $90.8 million and shareholders' equity increased to $105.4 million Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $18,096 | $27,554 | | Total current assets | $93,070 | $99,217 | | Total assets | $196,165 | $203,728 | | **Liabilities & Equity** | | | | Total current liabilities | $21,745 | $30,610 | | Total liabilities | $90,800 | $99,821 | | Total shareholders' equity | $105,365 | $103,907 | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For Q1 2025, revenues increased 17.4% to $48.6 million, gross profit rose to $34.9 million despite a gross margin decrease to 71.9%, and the net loss narrowed to $3.8 million or ($0.08) per share Condensed Consolidated Statements of Operations (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenues | $48,560 | $41,378 | | Gross Profit | $34,933 | $32,620 | | Loss from operations | $(1,661) | $(4,560) | | Net loss | $(3,834) | $(6,635) | | Net loss per common share | $(0.08) | $(0.15) | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) In the first three months of 2025, net cash used in operating activities was $13.2 million, net cash provided by investing activities was $1.3 million, and financing activities provided $2.4 million, resulting in a net decrease in cash of $9.5 million Summary of Cash Flows (in thousands) | Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(13,179) | $(12,266) | | Net cash provided by (used in) investing activities | $1,339 | $(3,251) | | Net cash provided by financing activities | $2,382 | $204 | | **Net decrease in cash** | **$(9,458)** | **$(15,313)** | [Notes to Unaudited Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Key notes detail the company's focus on peripheral nerve repair, potential clawback of **$950,000** for unmet grant milestones, a disagreement with a lender over up to **$12 million** in make-whole payments, and high dependency on Ohio processing facilities - The company's business is focused on the science, development, and commercialization of technologies for peripheral nerve regeneration and repair, with products including Avance® Nerve Graft and Axoguard® Nerve Protector. Substantially all revenues are derived from the U.S.[24](index=24&type=chunk) - The company has not met certain job creation milestones for economic development grants and could be obligated to pay back up to approximately **$950,000**. Discussions with grant authorities are ongoing[70](index=70&type=chunk)[71](index=71&type=chunk) - A disagreement exists with the lender (Oberland Capital) regarding the calculation of make-whole payments on the credit facility. The company's interpretation results in a zero make-whole payment at maturity, while the lender's alternative interpretation could result in payments of approximately **$9 million** for the first tranche and **$3 million** for the second tranche[72](index=72&type=chunk)[73](index=73&type=chunk) - The company is highly dependent on its processing facilities in Vandalia, Ohio (APC Facility) and Dayton, Ohio (leased from Solvita)[69](index=69&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management reported a 17.4% revenue increase for Q1 2025, driven by unit volume and price/mix, despite a gross margin decline due to higher product costs and write-offs, while operating expenses decreased, and the company expects sufficient liquidity for the next twelve months, highlighted by the FDA's acceptance of the BLA for Avance® Nerve Graft - The FDA accepted the filing of the company's Biologics License Application (BLA) for Avance® Nerve Graft, with a PDUFA goal date of **September 5, 2025**. Key regulatory milestones were completed in Q1 2025 to support this timeline[87](index=87&type=chunk) - The company's strategy focuses on deepening its presence in high-potential accounts like Level 1 trauma centers and academic hospitals by expanding nerve repair indications and driving adoption of its surgical algorithm[80](index=80&type=chunk) - The company believes existing cash, investments, and cash from sales will fund operations for at least the **next twelve months**[98](index=98&type=chunk) [Results of Operations](index=24&type=section&id=Results%20of%20Operations) Q1 2025 revenue grew 17.4% to $48.6 million, driven by a 12.0% increase in unit volume, while gross margin fell to 71.9% due to higher product costs and inventory write-offs, and total operating expenses decreased 1.6% due to reduced R&D costs Revenue and Gross Profit Comparison (in thousands) | Metric | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Revenues | $48,560 | $41,378 | +17.4% | | Gross Profit | $34,933 | $32,620 | +7.1% | | Gross Margin | 71.9% | 78.8% | -6.9 p.p. | - The increase in Q1 2025 revenue was driven by a **12.0% increase in unit volume**, a **3.2% impact from price changes**, and a **2.1% impact from product mix**[86](index=86&type=chunk) - R&D expenses decreased by **17.8% to $6.1 million**, primarily due to lower product development costs, including non-clinical expenses related to the BLA for Avance Nerve Graft[91](index=91&type=chunk) - Sales and marketing expenses increased **6.2% to $21.0 million** due to higher compensation, travel, and marketing program costs[90](index=90&type=chunk) [Liquidity and Capital Resources](index=26&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2025, the company held **$22.1 million** in cash and investments, a decrease of **$11.4 million** from year-end 2024, with net cash used in operations at **$13.2 million** and **$50 million** in outstanding debt, which management asserts is sufficient for at least the next 12 months - Principal sources of liquidity as of March 31, 2025, were cash, cash equivalents, and investments totaling **$22.1 million**[97](index=97&type=chunk) Cash Flow Summary (in thousands) | Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Operating activities | $(13,179) | $(12,266) | | Investing activities | $1,339 | $(3,251) | | Financing activities | $2,382 | $204 | - The company has **$50 million** in outstanding debt, with **$35 million** maturing in June 2027 and **$15 million** in June 2028. The interest rate was **11.91%** as of March 31, 2025[103](index=103&type=chunk) [Contractual Obligations and Commitments](index=28&type=section&id=Contractual%20Obligations%20and%20Commitments) The company has total contractual obligations of **$101.0 million**, primarily comprising a **$50.0 million** credit facility principal, **$32.2 million** in lease obligations, and **$15.2 million** in estimated interest payments Summary of Contractual Obligations (in thousands) | Contractual Obligations | Total | | :--- | :--- | | Credit Facility principal | $50,000 | | Credit Facility interest | $15,185 | | Credit Facility revenue participation payments | $1,975 | | Operating and financing lease obligations | $32,214 | | Insurance financing agreements | $1,432 | | Transition and separation obligations to former CEO | $151 | | **Total** | **$100,957** | [Quantitative and Qualitative Disclosures About Market Risk](index=28&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate exposure from its **$50 million** variable-rate credit facility, with a 100 basis point increase in interest rates estimated to increase annual interest expense by approximately **$500,000**, which is not considered material - The company has interest rate exposure from its **$50 million credit facility**, with an interest rate of **11.91%** as of March 31, 2025[107](index=107&type=chunk) - A **100 basis point** increase in interest rates would increase annual interest expense by approximately **$500,000**, which the company does not consider material[107](index=107&type=chunk) [Controls and Procedures](index=29&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were **effective** as of March 31, 2025, with no material changes in internal control over financial reporting during the quarter - Management concluded that the company's disclosure controls and procedures were **effective** as of March 31, 2025[110](index=110&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, internal controls[111](index=111&type=chunk) [Part II - Other Information](index=30&type=section&id=Part%20II%20-%20Other%20Information) [Legal Proceedings](index=30&type=section&id=Item%201.%20Legal%20Proceedings) The company is subject to various claims and lawsuits in the ordinary course of business, which management believes are either covered by insurance or are not expected to have a **material adverse effect** on the company's financial condition, results of operations, or cash flows - The company is involved in various legal proceedings in the ordinary course of business, which are not expected to have a **material adverse effect**[75](index=75&type=chunk)[113](index=113&type=chunk) [Risk Factors](index=30&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's **2024 Annual Report on Form 10-K** - No material changes to the risk factors disclosed in the **2024 Annual Report on Form 10-K** have occurred[114](index=114&type=chunk) [Other Information](index=30&type=section&id=Item%205.%20Other%20Information) During the first quarter of 2025, two directors adopted Rule 10b5-1 trading plans, with Amy Wendell planning to sell 5,000 shares and William Burke planning to sell 125,983 shares Rule 10b5-1 Trading Plan Adoptions | Name and Title | Action | Date | Securities to be Sold | | :--- | :--- | :--- | :--- | | Amy Wendell, Director | Adopt | 11/20/2024 | 5,000 | | William Burke, Director | Adopt | 3/14/2025 | 125,983 | [Exhibits](index=31&type=section&id=Item%206.%20Exhibits) The filing includes key exhibits such as the forms for the **2025 Performance Stock Unit** and **Restricted Stock Unit Award Agreements**, along with certifications from the Principal Executive Officer and Principal Financial Officer as required by the Sarbanes-Oxley Act - Key exhibits filed include forms of **2025 Performance Stock Unit** and **Restricted Stock Unit award agreements**[121](index=121&type=chunk) - Certifications by the CEO and CFO pursuant to Sections **302** and **906** of the Sarbanes-Oxley Act were filed with the report[121](index=121&type=chunk)