Financial Data and Key Metrics - Revenue for Q4 2023 was $6.9 million, up 216% from $2.2 million in Q4 2022, primarily due to the acquisition of AlterG [8] - Excluding AlterG sales, Q4 2023 revenue was $2.2 million, consistent with Q4 2022 [8] - GAAP operating loss for Q4 2023 was $6.1 million, compared to $5 million in Q4 2022 [12] - Non-GAAP operating loss improved to $3.8 million in Q4 2023 from $4 million in Q4 2022 [12] - Gross profit for Q4 2023 was $2.4 million (35.5% of revenue), up from $0.7 million (30.9% of revenue) in Q4 2022 [61] Business Line Data and Key Metrics - ReWalk Exoskeleton revenue in Q4 2023 was flat compared to Q4 2022, with the same number of units sold [87] - MyoCycle FES training cycle revenue declined slightly, offset by an increase in ReStore unit revenue [87] - AlterG backlog at the end of Q4 2023 was 46 systems, lower than Q3 2023 due to commercial reorganization [9] - The company expects to launch a new AlterG anti-gravity system mid-2024, targeting smaller private practice clinics [97] Market Data and Key Metrics - The company achieved Medicare reimbursement for the ReWalk personal exoskeleton in 2023 and expects Medicare claims to begin processing in April 2024 [4][74] - The US market is a key focus, with plans to expand Medicare coverage and engage private payers and Workers Compensation groups [18] - In Germany, the company expects up to 50% year-over-year growth in the exoskeleton market [102] - The company has 19 distributors in the EU and 22 distributors in the rest of the world [5] Company Strategy and Industry Competition - The company rebranded as Lifeward, integrating ReWalk and AlterG to unify teams and leverage strengths, resulting in $3 million in annual net savings expected in 2024 [56] - The company is shifting its US sales focus to physician referrals to improve scalability and patient qualification [71][108] - Technological advancements include a new AlterG anti-gravity system for smaller clinics and AI integration into exoskeleton prototypes [97][98] - The company aims to achieve profitability by 2026, driven by revenue growth, cost reductions, and operational synergies [72][85] Management Commentary on Operating Environment and Future Outlook - Management is optimistic about Medicare reimbursement finalization, expected to positively impact stock price and revenue growth [13][74] - The company expects 2024 revenue to be between $28 million and $32 million, driven by Medicare claims and new product launches [66][83] - Operating losses are expected to decline sequentially in 2024, with visibility to future operating profit [16][67] - The company is prepared for a reverse stock split if CMS reimbursement rates are not finalized in time to meet NASDAQ compliance [65][92] Other Important Information - The company has 70 ReWalk cases in process as of December 31, 2023, with 49 in Germany and 21 in the US [60] - Cash and cash equivalents at the end of Q4 2023 were $28.1 million, with no debt [91] - The company has submitted 35 claims to Medicare and plans to submit an additional 60-75 claims in 2024 [83][88] Q&A Session Summary Question: CMS Reimbursement Timeline - The company expects CMS reimbursement rules to take effect on April 1, 2024, with final payment rates anticipated soon [74][101] Question: Growth Expectations in Germany and Europe - The company expects strong growth in Germany, with up to 50% year-over-year growth in the exoskeleton market, supported by 19 distributors in the EU [102][117] Question: AlterG Revenue Dynamics and New Product Launch - AlterG revenue is expected to grow sequentially in 2024, with a new product launch targeting smaller clinics mid-year [39][76] - The new AlterG product is designed for smaller private practices, addressing a previously underserved market of approximately 15,000 clinics in the US [25][119] Question: Physician Referral Strategy - The company is shifting to a physician-focused referral model to improve scalability and patient qualification, targeting PM&R doctors initially [71][108][126] Question: Integration Savings Timeline - Integration savings of $3 million are expected to phase in throughout 2024, with full impact realized later in the year [130]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2023 or ☐ TRANSITION REPORT PURSUANT OR SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Commission File Number: 001-36612 ReWalk Robotics Ltd. (Exact name of registrant as specified in charter) | Israel | Not applicable | | --- | --- | | (State ...

[Company Overview & Highlights](index=1&type=section&id=Company%20Overview%20%26%20Highlights) Lifeward (formerly ReWalk Robotics Ltd.) completed commercial and operational integration, rebranded as Lifeward, aiming to elevate rehabilitation care standards through innovative solutions, expecting growth in 2024, especially benefiting from Medicare reimbursement for exoskeletons [Executive Summary & Strategic Vision](index=1&type=section&id=Executive%20Summary%20%26%20Strategic%20Vision) Lifeward completed organizational integration, ready to execute its strategy, and plans to expand ReWalk exoskeleton coverage for spinal cord injury patients by leveraging the new Medicare exoskeleton benefit category - Lifeward has completed organizational integration, preparing to execute its strategy and leverage the newly established Medicare exoskeleton benefit category to expand ReWalk exoskeleton coverage for spinal cord injury patients[3](index=3&type=chunk) - The company has completed the integration of commercial and operational resources of the former ReWalk and AlterG businesses, expecting **$3 million in annual net savings** in 2024[4](index=4&type=chunk) - The company launched its new corporate brand, Lifeward, to reflect its broader mission of elevating care standards in overcoming physical limitations and disabilities[4](index=4&type=chunk) [Key Highlights of Q4 2023 and Early 2024](index=1&type=section&id=Key%20Highlights%20of%20Q4%202023%20and%20Early%202024) Lifeward achieved record annual revenue in 2023, completed commercial and operational integration, and successfully launched its new brand, while CMS finalized the 2024 home health rule to include exoskeletons in Medicare brace benefits and is determining initial reimbursement levels for ReWalk personal exoskeletons 2023 Annual Revenue | Metric | 2023 (Millions USD) | 2022 (Millions USD) | Growth Rate | | :--- | :--- | :--- | :--- | | Annual Revenue | 13.9 | 5.5 | 151% | - The company completed the integration of commercial and operational resources of the former ReWalk and AlterG businesses, expecting **$3 million in annual net savings** in 2024[4](index=4&type=chunk) - The Centers for Medicare & Medicaid Services (CMS) finalized the 2024 home health rule, including exoskeletons in the Medicare brace benefit category, effective January 1, 2024[4](index=4&type=chunk) [Financial Results](index=2&type=section&id=Financial%20Results) Lifeward's financial performance in Q4 2023 showed significant revenue growth, but GAAP gross margin declined, and operating and net losses widened, though non-GAAP adjusted losses improved [Fourth Quarter 2023 Financial Performance](index=2&type=section&id=Fourth%20Quarter%202023%20Financial%20Performance) Lifeward achieved significant revenue growth in Q4 2023, but GAAP gross margin decreased, and operating and net losses expanded, while non-GAAP adjusted operating and net losses improved [Revenue Analysis](index=2&type=section&id=Revenue%20Analysis) Total revenue reached $6.9 million in Q4 2023, a 216% year-over-year increase, primarily driven by $4.7 million contributed by the AlterG business acquired in August 2023 Q4 2023 Revenue | Metric | Q4 2023 (Millions USD) | Q4 2022 (Millions USD) | Change (Millions USD) | Growth Rate | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | 6.9 | 2.2 | 4.7 | 216% | | Original ReWalk Business Revenue | 2.2 | 2.2 | 0 | 0% | | AlterG Business Contribution | 4.7 | - | 4.7 | - | [Gross Margin](index=2&type=section&id=Gross%20Margin) GAAP gross margin for Q4 2023 was 35.5%, an increase from the prior year, while non-GAAP adjusted gross margin was 47.0%, a 5.8 percentage point decrease year-over-year, mainly due to a less favorable product sales mix and material costs as a percentage of revenue in the prior year Q4 2023 Gross Margin | Metric | Q4 2023 | Q4 2022 | Change | | :--- | :--- | :--- | :--- | | GAAP Gross Margin | 35.5% | 30.9% | +4.6 percentage points | | Non-GAAP Adjusted Gross Margin | 47.0% | 52.8% | -5.8 percentage points | [Operating Expenses and Loss](index=2&type=section&id=Operating%20Expenses%20and%20Loss) Total operating expenses in Q4 2023 were $8.6 million, with AlterG contributing $3.2 million, resulting in a GAAP operating loss of $6.1 million, while non-GAAP adjusted operating loss improved by 6% to $3.8 million Q4 2023 Operating Expenses and Loss | Metric | Q4 2023 (Millions USD) | Q4 2022 (Millions USD) | Change (Millions USD) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Total Operating Expenses | 8.6 | 5.7 | 2.9 | 50.9% | | AlterG Contribution to Operating Expenses | 3.2 | - | - | - | | GAAP Operating Loss | (6.1) | (5.0) | (1.1) | 22% | | Non-GAAP Adjusted Operating Loss | (3.8) | (4.0) | 0.2 | -6% | [Net Loss and EPS](index=2&type=section&id=Net%20Loss%20and%20EPS) GAAP net loss for Q4 2023 was $5.6 million, or $0.13 per share, while non-GAAP adjusted net loss improved to $3.3 million, or $0.05 per share Q4 2023 Net Loss and EPS | Metric | Q4 2023 | Q4 2022 | Change | | :--- | :--- | :--- | :--- | | GAAP Net Loss (Millions USD) | (5.6) | (5.3) | (0.3) | | GAAP EPS | (0.13) | (0.09) | (0.04) | | Non-GAAP Adjusted Net Loss (Millions USD) | (3.3) | (4.3) | 1.0 | | Non-GAAP Adjusted EPS | (0.05) | (0.07) | 0.02 | [Liquidity](index=2&type=section&id=Liquidity) As of December 31, 2023, Lifeward held $28.1 million in unrestricted cash and cash equivalents with no debt, and cash outflow from operating activities was $4.4 million in Q4 Liquidity as of December 31, 2023 | Metric | Amount (Millions USD) | | :--- | :--- | | Unrestricted Cash and Cash Equivalents | 28.1 | | Debt | 0 | | Cash Used in Operating Activities in Q4 | 4.4 | [Financial Guidance](index=2&type=section&id=Financial%20Guidance) Lifeward projects full-year 2024 revenue between $28 million and $32 million, with non-GAAP gross margin expanding to over 40% and non-GAAP operating loss decreasing to low double-digit millions, while Q1 2024 revenue is expected to be $5 million to $5.5 million, excluding Medicare revenue 2024 Financial Guidance | Metric | Full-Year 2024 Guidance | Q1 2024 Guidance | | :--- | :--- | :--- | | Revenue | $28 million to $32 million | $5 million to $5.5 million | | Non-GAAP Gross Margin | Above 40% | - | | Non-GAAP Operating Loss | Low double-digit millions | - | - The company expects Q1 revenue to increase in subsequent quarters, consistent with historical patterns, benefiting from the gradual implementation of Medicare revenue and anticipated mid-year contributions from new AlterG products[11](index=11&type=chunk) - Lifeward does not provide a GAAP reconciliation for non-GAAP financial guidance because the company cannot reasonably determine and without unreasonable effort predict the items included in the reconciliation, such as share-based compensation expense, acquisition-related expenses, and contingent consideration expenses[12](index=12&type=chunk) [Corporate Information](index=3&type=section&id=Corporate%20Information) This section provides details on Lifeward's upcoming Q4 and full-year 2023 earnings conference call, an overview of the company's mission and product portfolio, and important disclaimers regarding forward-looking statements and non-GAAP financial measures [Conference Call Details](index=3&type=section&id=Conference%20Call%20Details) Lifeward management will host a Q4 and full-year 2023 earnings conference call on Tuesday, February 27, 2024, at 8:30 AM ET, providing dial-in numbers for the US, international, Israel, and Germany, along with a webcast link Conference Call Information | Date | Tuesday, February 27, 2024 | | :--- | :--- | | Time | 8:30 AM ET | | US Dial-in | 1-833-316-0561 | | International Dial-in | 1-412-317-0690 | | Access Code | Lifeward Earnings Call | | Webcast | https://edge.media-server.com/mmc/p/3pun37to/ | [About Lifeward](index=3&type=section&id=About%20Lifeward) Lifeward designs, develops, and commercializes life-changing solutions across the continuum of physical rehabilitation and recovery, empowering individuals with physical limitations or disabilities through innovative products, including ReWalk exoskeletons, AlterG anti-gravity systems, ReStore exoskeleton suits, and MyoCycle FES systems - Lifeward designs, develops, and commercializes life-changing solutions across the continuum of physical rehabilitation and recovery, providing proven functional and health benefits in clinical settings, homes, and communities[14](index=14&type=chunk) - Lifeward's product portfolio includes ReWalk exoskeletons, AlterG anti-gravity systems, ReStore exoskeleton suits, and MyoCycle FES systems[14](index=14&type=chunk) - Founded in 2001, Lifeward operates in the United States, Israel, and Germany[15](index=15&type=chunk) [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This press release contains forward-looking statements, including projections of the company's future performance and non-historical facts, which are based on management's current expectations and subject to uncertainties, risks, and changing circumstances that could cause actual results to differ materially - Forward-looking statements may include projections of the company's future performance and may be identified by words such as "anticipate," "assume," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "future," "will," "should," "would," "seek," or similar phrases[17](index=17&type=chunk) - Important factors that could cause the company's actual results to differ materially from forward-looking statements include: the ability to realize the anticipated benefits of the AlterG acquisition, the ability to retain customers and key personnel, relationships with suppliers and distributors, uncertainties of future clinical trials, sufficiency of funding, Nasdaq listing compliance, product market acceptance, third-party payer reimbursement capabilities, limited operating history, clinical research programs, future growth, supply chain, product improvements and development, medical device reporting regulation compliance, regulatory approvals, intellectual property protection, cybersecurity risks, and the use of proceeds from securities offerings[17](index=17&type=chunk) [Non-GAAP Financial Measures Explanation](index=4&type=section&id=Non-GAAP%20Financial%20Measures%20Explanation) The company uses non-GAAP financial measures, including non-GAAP gross margin, operating expenses, operating loss, and net loss, to supplement its GAAP financial statements, believing these metrics help investors understand ongoing business performance, but emphasizes they should not be considered substitutes for GAAP measures and may not be comparable to non-GAAP measures used by other companies - The company believes the use of non-GAAP financial measures, including non-GAAP gross margin, operating expenses, operating loss, and net loss, is helpful to investors because these measures exclude certain significant items that may not be representative of or related to the results of ongoing business operations[18](index=18&type=chunk)[19](index=19&type=chunk) - Non-GAAP financial data are not measures of the company's financial performance under US GAAP and should not be considered as alternatives to operating loss or net loss or any other performance measures derived in accordance with GAAP[19](index=19&type=chunk) - Non-GAAP financial measures may not provide information directly comparable to that provided by other companies in Lifeward's industry, as other companies may calculate non-GAAP financial results differently, particularly with respect to non-recurring, unusual items[19](index=19&type=chunk) [Condensed Consolidated Financial Statements](index=6&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents Lifeward Robotics Ltd. and its subsidiaries' audited condensed consolidated financial statements, including statements of operations, non-GAAP reconciliations, balance sheets, and cash flow statements, along with revenue by geographic region [Statements of Operations](index=6&type=section&id=Statements%20of%20Operations) This section provides Lifeward Robotics Ltd. and its subsidiaries' audited condensed consolidated statements of operations, detailing revenue, cost of sales, gross profit, operating expenses, operating loss, net loss, and basic net loss per share for the three and twelve months ended December 31, 2023, and 2022 Condensed Consolidated Statements of Operations (Excerpt) | Metric (Thousands USD) | Q4 2023 | Q4 2022 | Full-Year 2023 | Full-Year 2022 | | :--- | :--- | :--- | :--- | :--- | | Revenue | 6,884 | 2,179 | 13,854 | 5,511 | | Cost of Sales | 4,441 | 1,506 | 9,401 | 3,606 | | Gross Profit | 2,443 | 673 | 4,453 | 1,905 | | Operating Expenses | 8,580 | 5,678 | 28,065 | 21,007 | | Operating Loss | (6,137) | (5,005) | (23,612) | (19,102) | | Net Loss | (5,639) | (5,313) | (22,133) | (19,569) | | Basic Net Loss Per Share | (0.13) | (0.09) | (0.37) | (0.31) | [Non-GAAP Reconciliations](index=7&type=section&id=Non-GAAP%20Reconciliations) This section provides reconciliations of GAAP net loss, operating loss, gross profit, research and development expenses, sales and marketing expenses, and general and administrative expenses to their corresponding non-GAAP measures, detailing adjustments such as the impact of acquisition accounting on inventory, intangible asset amortization, M&A transaction and integration costs, rebranding, restructuring, contingent consideration income/expense, inventory impairment, and share-based compensation expense Reconciliation of GAAP Net Loss to Non-GAAP Net Loss (Excerpt) | Metric (Thousands USD) | Q4 2023 | Q4 2022 | Full-Year 2023 | Full-Year 2022 | | :--- | :--- | :--- | :--- | :--- | | GAAP Net Loss | (5,639) | (5,313) | (22,133) | (19,569) | | Total Adjustments | 2,343 | 968 | 7,066 | 1,614 | | Non-GAAP Net Loss | (3,296) | (4,345) | (15,067) | (17,955) | | Non-GAAP EPS | (0.05) | (0.07) | (0.25) | (0.29) | Reconciliation of GAAP Operating Loss to Non-GAAP Operating Loss (Excerpt) | Metric (Thousands USD) | Q4 2023 | Q4 2022 | Full-Year 2023 | Full-Year 2022 | | :--- | :--- | :--- | :--- | :--- | | GAAP Operating Loss | (6,137) | (5,005) | (23,612) | (19,102) | | Total Adjustments | 2,343 | 968 | 7,066 | 1,614 | | Non-GAAP Operating Loss | (3,794) | (4,037) | (16,546) | (17,488) | Reconciliation of GAAP Gross Profit to Non-GAAP Gross Profit (Excerpt) | Metric (Thousands USD) | Q4 2023 | Q4 2022 | Full-Year 2023 | Full-Year 2022 | | :--- | :--- | :--- | :--- | :--- | | GAAP Gross Profit | 2,443 | 673 | 4,453 | 1,905 | | Total Adjustments | 783 | 477 | 1,006 | 487 | | Non-GAAP Gross Profit | 3,226 | 1,150 | 6,359 | 2,392 | [Balance Sheets](index=10&type=section&id=Balance%20Sheets) This section provides Lifeward Robotics Ltd. and its subsidiaries' audited condensed consolidated balance sheets, detailing assets, liabilities, and stockholders' equity as of December 31, 2023, and 2022 Condensed Consolidated Balance Sheets (Excerpt) | Metric (Thousands USD) | December 31, 2023 | December 31, 2022 | | :--- | :--- | :--- | | **Assets** | | | | Cash and Cash Equivalents | 28,083 | 67,896 | | Total Current Assets | 39,222 | 72,510 | | Intangible Assets | 12,525 | - | | Goodwill | 7,538 | - | | Total Assets | 63,192 | 74,236 | | **Liabilities and Equity** | | | | Total Current Liabilities | 11,795 | 4,782 | | Contingent Consideration Liability | 3,292 | - | | Stockholders' Equity | 46,510 | 68,165 | | Total Liabilities and Equity | 63,192 | 74,236 | [Statements of Cash Flows](index=11&type=section&id=Statements%20of%20Cash%20Flows) This section provides Lifeward Robotics Ltd. and its subsidiaries' audited condensed consolidated statements of cash flows, detailing cash flows from operating, investing, and financing activities for the twelve months ended December 31, 2023, and 2022 Condensed Consolidated Statements of Cash Flows (Excerpt) | Metric (Thousands USD) | Full-Year 2023 | Full-Year 2022 | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (20,667) | (17,891) | | Net Cash Used in Investing Activities | (18,149) | (25) | | Net Cash Used in Financing Activities | (992) | (2,500) | | Decrease in Cash, Cash Equivalents, and Restricted Cash | (39,763) | (20,495) | | Cash, Cash Equivalents, and Restricted Cash at End of Period | 28,792 | 68,555 | [Revenue by Geographic Region](index=12&type=section&id=Revenue%20by%20Geographic%20Region) This section details Lifeward Robotics Ltd. and its subsidiaries' revenue by geographic region, including the United States, Europe, Asia Pacific, and Rest of World, for the three and twelve months ended December 31, 2023, and 2022 Revenue by Geographic Region (Thousands USD) | Region | Q4 2023 | Q4 2022 | Full-Year 2023 | Full-Year 2022 | | :--- | :--- | :--- | :--- | :--- | | United States | 3,338 | 1,110 | 7,636 | 2,303 | | Europe | 2,843 | 1,034 | 5,044 | 3,057 | | Asia Pacific | 264 | 2 | 387 | 115 | | Rest of World | 439 | 33 | 787 | 36 | | **Total Revenue** | **6,884** | **2,179** | **13,854** | **5,511** |

FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____ to ______ Commission File Number: 001-36612 ReWalk Robotics Ltd. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Exact name of registrant as specified in charter) | Israel | Not applicable | | --- | --- | | ...

Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 UNITED STATES SECURITIES AND EXCHANGE COMMISSION ReWalk Robotics Ltd. (Exact name of registrant as specified in charter) | Israel | Not applicable | | --- | --- | | (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | | 3 Hatnufa Street, Floor 6, Yokneam Ilit, Israel | 2069203 | | (Address of principal executive offices) | (Zip Code) | ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____ to ______ Commission File Number: 001-36612 ReWalk Robotics Ltd. (Exact name of registrant as specified in charter) | Israel | Not applicable | | --- | --- | | (St ...

ReWalk Robotics Ltd. (RWLK) Q4 2022 Earnings Conference Call February 23, 2023 8:30 AM ET Company Participants Mike Lawless - Chief Financial Officer Larry Jasinski - Chief Executive Officer Conference Call Participants Swayampakula Ramakanth - H.C. Wainwright Martin Pollack - KMTR Operator Good morning, everyone and welcome to the ReWalk Robotics Fourth Quarter Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today’s presentation, there will be an oppo ...

[Report Information](index=1&type=section&id=Report%20Information) [Form 10-K Filing Details](index=1&type=section&id=Form%2010-K%20Filing%20Details) This report is ReWalk Robotics Ltd.'s annual Form 10-K filing for the year ended December 31, 2022, with its shares traded on the Nasdaq Capital Market under the ticker RWLK - The company filed its annual report on Form 10-K for the year ended December 31, 2022[2](index=2&type=chunk) Company Securities Registered Information | Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered | | :------------------ | :---------------- | :-------------------------------------- | | Ordinary Shares, par value NIS 0.25 per share | RWLK | Nasdaq Capital Market | [Registrant Status and Market Value](index=1&type=section&id=Registrant%20Status%20and%20Market%20Value) The company is classified as a non-accelerated filer and a smaller reporting company, with an aggregate market value of approximately **$58.5 million** of common stock held by non-affiliates as of June 30, 2022 - The company is classified as a non-accelerated filer and a smaller reporting company[9](index=9&type=chunk) - As of June 30, 2022, the aggregate market value of common stock held by non-affiliates was approximately **$58,466,801**[11](index=11&type=chunk) - As of February 23, 2023, the company had **59,480,132** ordinary shares outstanding[12](index=12&type=chunk) [Special Note Regarding Forward-Looking Statements and Risk Factors Summary](index=4&type=section&id=Special%20Note%20Regarding%20Forward-Looking%20Statements%20and%20Risk%20Factors%20Summary) [Forward-Looking Statements Disclaimer](index=4&type=section&id=Forward-Looking%20Statements%20Disclaimer) This report contains forward-looking statements based on management's beliefs and assumptions regarding future operating results, business strategies, and financing plans, which are subject to uncertainties that may cause actual results to differ materially - Forward-looking statements are based on management's beliefs and assumptions, covering future operating results, business strategies, financing plans, competitive position, industry environment, growth opportunities, and market opportunities[18](index=18&type=chunk) - Important factors may cause actual results, activity levels, performance, or achievements to differ materially from those expressed in forward-looking statements[18](index=18&type=chunk) - Investors should not place undue reliance on forward-looking statements, and the company undertakes no obligation to update any forward-looking statements after the report date[21](index=21&type=chunk)[22](index=22&type=chunk) [Key Risk Factors Summary](index=4&type=section&id=Key%20Risk%20Factors%20Summary) The company faces various key risks, including future growth, product market acceptance, third-party reimbursement, Nasdaq listing compliance, COVID-19 impact, funding needs, limited operating history, acquisition integration, clinical research, supply chain, product improvements, regulatory approvals, cybersecurity, intellectual property protection, and stock market volatility - Future growth, including the ability to increase sales in existing markets and expand into new ones - The ability to maintain and enhance product reputation and market acceptance - The ability to obtain third-party payer reimbursement or advance CMS coverage for products - The ability to regain and maintain compliance with Nasdaq Capital Market continued listing requirements - The adverse impact of the COVID-19 pandemic on business and operating results - Whether sufficient capital is available to meet future capital needs, which could impair efforts to develop and commercialize existing and new products - Limited operating history and the ability to leverage sales, marketing, and training infrastructure - The ability to achieve business growth through acquisitions of businesses, products, or technologies, and the risk of failed acquisition management or integration - Expectations regarding clinical research programs and clinical outcomes - The ability to obtain product components from third-party suppliers and ongoing support from product manufacturers - The ability to improve existing products and develop new ones - Compliance with medical device reporting regulations, reporting product-related side effects, which could lead to enforcement actions such as voluntary corrective actions or mandatory recalls - The ability to obtain and maintain regulatory approvals and comply with any post-market requirements - The risk of cybersecurity attacks or information technology system breaches severely disrupting business operations - The ability to maintain adequate intellectual property protection and avoid infringing on others' intellectual property - The impact of significant sales of company stock by certain shareholders on market price - The ability to effectively utilize proceeds from securities offerings - Significant dilution that may result from periodic issuances of ordinary shares - The impact of the market price of ordinary shares on whether the company is deemed a passive foreign investment company - Market and other conditions, including inflation or global instability, that could disrupt business operations or financial condition - Other factors discussed in "Part I. Item 1A. Risk Factors"[20](index=20&type=chunk)[24](index=24&type=chunk) [ITEM 1. BUSINESS](index=6&type=section&id=ITEM%201.%20BUSINESS) [Overview](index=6&type=section&id=Overview) ReWalk Robotics Ltd. is a medical device company focused on designing, developing, and commercializing innovative technologies to provide mobility and health support for individuals with neurological disorders, featuring ReWalk spinal cord injury exoskeletons, ReStore stroke rehabilitation soft exoskeletons, and MyoCycle FES Pro distribution - ReWalk Robotics Ltd. designs, develops, and commercializes innovative technologies aimed at providing mobility and health support for individuals with neurological disorders[25](index=25&type=chunk) - ReWalk Personal and ReWalk Rehabilitation exoskeleton devices: Used for spinal cord injury (SCI) patients, employing tilt-sensor technology, an onboard computer, and motion sensors to drive motorized legs, enabling paraplegic individuals to stand and walk - ReStore Exo-Suit device: A lightweight soft exoskeleton for rehabilitation of individuals with lower limb disability due to stroke, commercialization began in June 2019 - MyoCycle FES Pro cycling device: Exclusively distributed in the United States to rehabilitation clinics and Veterans Affairs (VA) hospitals - MediTouch Tutor motion biofeedback system: Previously an exclusive distribution product, the agreement was terminated on January 31, 2023, due to unsatisfactory sales performance - ReBoot: A research-stage personal soft exoskeleton for home and community use by post-stroke patients, which received FDA Breakthrough Device designation, but further investment was paused in 2023[25](index=25&type=chunk)[26](index=26&type=chunk)[27](index=27&type=chunk) - The company's primary markets are the United States and Europe, with direct sales operations in Germany and partnerships with distributors in other key countries[28](index=28&type=chunk) - Revenue sources include third-party payers (private and government payers) and self-pay individuals, with the company actively pursuing reimbursement and insurance coverage[29](index=29&type=chunk)[30](index=30&type=chunk)[31](index=31&type=chunk) [COVID-19 Pandemic Impact](index=7&type=section&id=COVID-19%20Pandemic%20Impact) The COVID-19 pandemic significantly disrupted the company's operations, causing global supply chain issues, hindering new customer acquisition, delaying product trials and training, and reducing product demand due to healthcare system staff shortages, with business not yet fully recovering to pre-pandemic levels - The pandemic caused significant disruptions to the global economy, capital markets, and the company's business[33](index=33&type=chunk) - Global suppliers, distributors, and manufacturing facilities were severely adversely affected by restrictive government and corporate measures[34](index=34&type=chunk) - Pandemic restrictions impacted the company's ability to identify new customers through trade shows, engage with existing customers, conduct product trials, deliver and service systems, and provide training for new patients and rehabilitation centers[34](index=34&type=chunk) - Staff shortages in the healthcare system led to decreased demand for spinal cord injury products[34](index=34&type=chunk) - Despite the lifting of restrictions, business has not fully recovered to pre-pandemic levels and is expected to continue to be adversely affected[34](index=34&type=chunk) [ReWalk Personal and ReWalk Rehabilitation Products](index=8&type=section&id=ReWalk%20Personal%20and%20ReWalk%20Rehabilitation%20Products) ReWalk Personal 6.0 and ReWalk Rehabilitation are robotic exoskeletons designed for paraplegic patients to restore standing and walking, utilizing tilt-sensor technology to provide a natural gait and demonstrating potential secondary health benefits, with approximately **20.2%** of **296,000** US spinal cord injury patients being potential candidates - ReWalk Personal 6.0: A battery-powered wearable exoskeleton that uses tilt-sensor technology, sensors, and a computer control system to drive knee and hip movement, allowing users to stand, walk, sit, and, depending on local regulations, ascend and descend stairs and curbs - ReWalk Rehabilitation: Composed of a Personal 6.0 unit and multi-size adjustable components, used by clinics for training and therapy for multiple patients, and also for evaluating a patient's future ability to use ReWalk Personal - ReWalk Personal 6.0 received CE Mark in Europe in late 2012 and FDA approval in the United States in June 2014 - Clinical studies indicate ReWalk Personal can provide functional walking speeds and have reported potential secondary health benefits, including pain reduction, improved bowel and bladder function, reduced spasticity, increased range of motion, improved sleep and reduced fatigue, increased oxygen intake and heart rate, and reduced hospitalizations - Approximately **296,000** individuals in the United States have spinal cord injuries, with about **17,900** new cases annually; based on FDA restrictions, approximately **20.2%** of spinal cord injury patients may be considered candidates for the ReWalk Personal exoskeleton[35](index=35&type=chunk)[36](index=36&type=chunk)[38](index=38&type=chunk)[41](index=41&type=chunk)[42](index=42&type=chunk)[43](index=43&type=chunk)[44](index=44&type=chunk)[46](index=46&type=chunk) [Overview of Spinal Cord Injury](index=9&type=section&id=Overview%20of%20Spinal%20Cord%20Injury) Spinal cord injury is a severe medical condition resulting from physical damage to spinal nerves, leading to functional loss such as mobility or sensation, categorized by completeness and level of injury - Spinal cord injury is a severe medical condition resulting from physical damage to spinal nerves, leading to loss of function such as mobility or sensation[39](index=39&type=chunk) - Complete injury: Patients experience a complete loss of sensation and voluntary movement below the level of injury - Incomplete injury: Some function is retained below the level of injury - Injury level classification: Cervical injuries result in tetraplegia (quadriplegia), thoracic injuries result in paraplegia (paralysis of the legs), lumbar injuries result in paraplegia, and sacral injuries primarily affect bowel and bladder function, as well as sexual function[39](index=39&type=chunk)[40](index=40&type=chunk) [Market Opportunity](index=10&type=section&id=Market%20Opportunity) Spinal cord injury patients face severe physical and psychological deterioration from prolonged bed rest, incurring high medical costs and reduced quality of life, with **296,000** patients in the US and **42,000** eligible veterans as of 2021 - Long-term bed rest for spinal cord injury patients can lead to severe physical and psychological deterioration, resulting in high medical costs and reduced quality of life[43](index=43&type=chunk) - The National Spinal Cord Injury Statistical Center (NSCISC) estimates that paraplegia-related complications cost approximately **$500,000** in the first year post-injury, with substantial lifetime costs[43](index=43&type=chunk) - As of 2021, there were **296,000** individuals with spinal cord injuries in the United States, with approximately **17,900** new cases annually; the Department of Veterans Affairs (VA) has about **42,000** eligible veteran patients[44](index=44&type=chunk) - Based on FDA restrictions, approximately **20.2%** of spinal cord injury patients may be considered candidates for the ReWalk Personal exoskeleton[46](index=46&type=chunk) [Sales and Marketing activities](index=10&type=section&id=Sales%20and%20Marketing%20activities) The company shifted its commercial focus from rehabilitation centers to direct promotion of ReWalk Personal exoskeletons to patients, physicians, and physical therapists, emphasizing medical necessity, while continuing to pursue reimbursement efforts and expand commercial coverage through direct sales and distributors - The company has shifted its commercialization focus from rehabilitation centers to directly promoting the ReWalk Personal exoskeleton to patients, physicians, and physical therapists, emphasizing its necessity as a medical intervention[47](index=47&type=chunk) - The company sells products directly in Germany and the United States, and primarily through distributors in other markets[48](index=48&type=chunk) ReWalk Device Deployment Numbers (units) | Device Type | As of December 31, 2022 | As of December 31, 2021 | | :------- | :----------------- | :----------------- | | ReWalk Rehabilitation | 128 | 121 | | ReWalk Personal | 572 | 533 | - The company plans to continue focusing on reimbursement efforts, handling insurance claims on a case-by-case basis, and investing in expanding commercial reimbursement coverage[49](index=49&type=chunk) [Third-Party Reimbursements](index=11&type=section&id=Third-Party%20Reimbursements) The company actively seeks third-party reimbursement for ReWalk products from the US Department of Veterans Affairs (VA) and German health insurance providers, with VA having a national policy and several German insurers offering coverage, while pursuing broader Medicare coverage in the US through case-by-case applications and CMS collaboration - In the United States, individuals typically obtain ReWalk Personal exoskeletons through third-party medical insurance (such as workers' compensation insurance, VA) or self-pay[52](index=52&type=chunk) - The VA issued a national policy in December 2014, covering assessment, training, and procurement of ReWalk Personal exoskeleton systems for eligible veterans; as of December 31, 2022, **34** devices have been deployed through the VA policy, and the VA contributed **14%** of total revenue in 2022[53](index=53&type=chunk) - The company is collaborating with CMS to clarify Medicare coverage categories for personal exoskeletons and obtained a unique code for the ReWalk Personal exoskeleton in July 2020[59](index=59&type=chunk) - In Germany, BARMER GEK and DGUV have indicated they will provide coverage for eligible users; the ReWalk Personal exoskeleton system has been listed in the German medical device directory, and several German statutory health insurance (SHI) and private health insurance (PHI) companies have signed agreements with the company[31](index=31&type=chunk)[64](index=64&type=chunk) - Italy's Ministry of Labor and Social Policies issued a policy in March 2018 to provide exoskeleton systems for eligible spinal cord injury patients, with **10** devices supplied through the Italian distributor[66](index=66&type=chunk) [United States](index=11&type=section&id=United%20States) In the US, the VA issued a national policy in 2014 covering ReWalk Personal systems for eligible veterans, contributing **14%** of 2022 revenue, while the company works with CMS for broader Medicare coverage amidst a lack of uniform commercial insurance policies - The VA issued a national policy in December 2014, covering assessment, training, and procurement of ReWalk Personal exoskeleton systems for eligible veterans; as of December 31, 2022, **34** devices have been deployed through the VA policy, and the VA contributed **14%** of total revenue in 2022[53](index=53&type=chunk) - Commercial insurance payers in the United States do not yet have a uniform medical technology coverage and reimbursement policy for electronic exoskeletons, but reimbursement can be obtained through case-by-case determinations[56](index=56&type=chunk) - As of December 31, 2022, **13** insurance coverage decision cases were pending in the United States[57](index=57&type=chunk) - The company is collaborating with CMS to seek national Medicare beneficiary category designation for the ReWalk Personal exoskeleton and obtained a unique code in July 2020[59](index=59&type=chunk)[60](index=60&type=chunk) [Europe](index=12&type=section&id=Europe) In Europe, German insurers BARMER and DGUV cover ReWalk systems, which are listed in the German medical device directory, and Italy's Ministry of Labor and Social Policies also provides coverage for eligible spinal cord injury patients - German insurance companies BARMER and DGUV have indicated they will provide coverage for ReWalk systems for eligible users[64](index=64&type=chunk) - The ReWalk Personal system has been listed in the German medical device directory, and German statutory health insurance (SHI) and private health insurance (PHI) companies have signed agreements with the company[64](index=64&type=chunk) - As of December 31, 2022, **47** insurance cases were pending in Germany[63](index=63&type=chunk) - Italy's Ministry of Labor and Social Policies issued a policy in March 2018 to provide exoskeleton systems for eligible spinal cord injury patients, with **10** devices supplied through the Italian distributor[66](index=66&type=chunk) [ReStore](index=13&type=section&id=ReStore) ReStore Exo-Suit is a lightweight soft exoskeleton for stroke rehabilitation, commercialized in 2019 after FDA and CE approvals, designed to improve walking speed and symmetry through flexible materials and sensors, with **33** units deployed by the end of 2022 - The ReStore Exo-Suit is a lightweight soft exoskeleton system, initially designed for rehabilitation of stroke patients, and began commercialization in June 2019 after receiving FDA approval and CE approval in May[68](index=68&type=chunk) - ReStore provides plantarflexion and dorsiflexion assistance to the patient's ankle joint through flexible materials, sensors, and powered assistance, aiming to improve walking speed and symmetry[70](index=70&type=chunk)[71](index=71&type=chunk) - The primary market for ReStore is rehabilitation clinics with stroke treatment programs, and the company focuses its commercial efforts in the United States and Europe[72](index=72&type=chunk) ReStore Device Deployment Numbers (units) | Year | Deployment Quantity | | :--- | :------- | | 2022 | 33 | | 2021 | 30 | [ReBoot](index=14&type=section&id=ReBoot) ReBoot is a research-stage personal soft exoskeleton for post-stroke home and community use, granted FDA Breakthrough Device designation in November 2021, but further investment was temporarily paused in 2023 pending evaluation of its clinical and commercial opportunities - ReBoot is a research-stage personal soft exoskeleton for home and community use by post-stroke patients, which received FDA Breakthrough Device designation in November 2021[27](index=27&type=chunk)[76](index=76&type=chunk) - ReBoot aims to provide walking assistance for individuals with impaired ankle function due to neurological injury (such as stroke), with an estimated market size of approximately **400,000** stroke patients annually requiring walking assistance[76](index=76&type=chunk) - In 2023, the company temporarily paused further investment in the ReBoot development pathway, pending further determination of its clinical and commercial opportunities[27](index=27&type=chunk)[76](index=76&type=chunk) [Competition](index=14&type=section&id=Competition) The medical exoskeleton market is highly competitive and rapidly evolving, with key rivals including Ekso Bionics and Cyberdyne, and ReWalk Personal's tilt-sensor technology and FDA personal use clearance, along with ReStore's natural gait assistance and cost-effectiveness, provide competitive advantages - The medical exoskeleton market is highly competitive and rapidly changing, with competition expected to intensify[77](index=77&type=chunk) - Key competitors: Ekso Bionics, Rex Bionics Pty, Cyberdyne, FREE Bionics, DIH, AlterG, Wandercraft, and Bioness - Alternative devices and therapies: Treadmill gait therapy, such as products offered by Hocoma, Tyromotion, AlterG, Aretech, and Reha Technology[78](index=78&type=chunk)[81](index=81&type=chunk) - Key competitive advantages of the ReWalk Personal device include tilt-sensor technology, a more natural gait, faster walking speed, self-weight support capability, and broad user specifications, and it was the first medical exoskeleton to receive FDA clearance for personal use[79](index=79&type=chunk) - Competitive advantages of the ReStore soft exoskeleton device include achieving a natural functional walking pattern through flexible materials, sensors, and powered assistance, and its lower cost and weight compared to rigid exoskeleton devices[80](index=80&type=chunk) [Community Engagement and Education](index=15&type=section&id=Community%20Engagement%20and%20Education) The company dedicates significant resources to engage and educate the spinal cord injury community, promoting the benefits of SCI products and ReStore devices through collaborations with hospitals, rehabilitation centers, key opinion leaders, and patient advocacy groups to advance exoskeleton technology adoption - The company is committed to interacting with and educating the spinal cord injury community, promoting the benefits of SCI products and ReStore devices[84](index=84&type=chunk) - Actively collaborates with hospitals, rehabilitation centers, and key opinion leaders, participating in research and development and clinical activities[84](index=84&type=chunk) - Several advocacy groups, including the United Spinal Association and the Dana and Christopher Reeves Foundation, have publicly endorsed the ReWalk Personal device[85](index=85&type=chunk) [Services and Customer Support](index=15&type=section&id=Services%20and%20Customer%20Support) The company operates support centers in Marlborough, US, and Berlin, Germany, providing comprehensive customer support and product services for North America and Europe through specialized technical staff, including training for healthcare providers and direct user assistance - The company operates support centers in Marlborough, United States, and Berlin, Germany, responsible for all customer support and product service functions in North America and Europe[86](index=86&type=chunk) - Provides training for healthcare providers and support for product users through specialized technical service personnel[86](index=86&type=chunk) [Research and Development](index=15&type=section&id=Research%20and%20Development) The company maintains a robust R&D program to support existing products and develop new ones, with primary activities in Yokneam, Israel, funded partly by the Israel Innovation Authority (IIA), and collaborations with the Human-Robot Interaction (HRI) Consortium and Harvard University to advance exoskeleton technology - The company is committed to investing in a robust research and development program to support existing product lines and develop new, complementary products[87](index=87&type=chunk) - The R&D team includes internal and external engineers, mechanics, researchers, as well as marketing, quality, manufacturing, regulatory, and clinical personnel - Primary R&D work is conducted at facilities in Yokneam, Israel - Product design improvements and expanded labeling work are underway for ReWalk Personal 6.0, with plans to introduce the ReWalk 7.0 next-generation device - Future medical indications that may be pursued include multiple sclerosis, cerebral palsy, Parkinson's disease, and assistance for the elderly[87](index=87&type=chunk)[88](index=88&type=chunk) - As of December 31, 2022, the company had received a total of **$2.3 million** in R&D funding from the Israel Innovation Authority (IIA)[89](index=89&type=chunk) [Research and Development Collaborations](index=16&type=section&id=Research%20and%20Development%20Collaborations) The company collaborates with the Human-Robot Interaction (HRI) Consortium to develop advanced social robotics and with Harvard University on lightweight soft exoskeleton technology for lower limb disabilities, securing exclusive licenses for related patents - On April 1, 2022, the company entered into an R&D collaboration agreement with the Human-Robot Interaction (HRI) Consortium (part of the Israel Innovation Authority MAGNET incentive program), aimed at developing advanced robotic technologies with social capabilities to improve human-robot interaction[90](index=90&type=chunk) - The HRI Consortium project budget is **NIS 57 million**, with **NIS 1.745 million** allocated to ReWalk-specific projects[90](index=90&type=chunk) - On May 16, 2016, the company entered into a research collaboration agreement and an exclusive license agreement with Harvard University to jointly develop lightweight soft exoskeleton system technology for lower limb disabilities, aimed at treating conditions such as stroke, multiple sclerosis, and mobility impairment in the elderly[91](index=91&type=chunk) - Under the Harvard license agreement, the company obtained a global, exclusive, royalty-bearing license to Harvard University's relevant patents and the right to license new inventions arising from the joint research collaboration[92](index=92&type=chunk) [Intellectual Property](index=16&type=section&id=Intellectual%20Property) The company protects its intellectual property through patents, trademarks, confidentiality agreements, and trade secret laws, holding **12** US patents, **19** non-US patents, and **11** pending applications as of December 31, 2022, with ReWalk and ReStore trademarks registered in multiple regions - The company protects its intellectual property through patents, trademarks, confidentiality agreements, and trade secret laws[95](index=95&type=chunk) - As of December 31, 2022, the company held **12** granted US patents and **19** granted non-US patents - The company has **11** pending patent applications in the United States, China, and Europe - Patents cover ReWalk's tilt-sensor technology and user-activated control methods - The ReWalk trademark is registered in the United States, Europe, Israel, and the United Kingdom - The ReStore trademark is registered in the United States, Europe, and the United Kingdom[97](index=97&type=chunk)[100](index=100&type=chunk) - Patent terms typically last **20 years** from the earliest filing date but may be slightly extended due to patent term adjustments[99](index=99&type=chunk) [Government Regulation](index=17&type=section&id=Government%20Regulation) The company's medical products and manufacturing are extensively regulated by agencies like the US FDA, EU MDR, and UKCA, covering product development, testing, manufacturing, labeling, marketing, and post-market surveillance, requiring compliance with pre-market and post-market requirements, as well as anti-kickback, false claims, and data privacy laws - The company's medical products and manufacturing operations are subject to extensive regulation by domestic and international agencies, including the U.S. FDA, EU MDR, and UKCA[102](index=102&type=chunk)[119](index=119&type=chunk)[121](index=121&type=chunk) - Regulation covers product development, testing, manufacturing, labeling, storage, installation, servicing, advertising, promotion, marketing, distribution, import, export, and market surveillance[102](index=102&type=chunk) - United States: Medical devices are classified into Class I, II, or III, requiring 510(k) pre-market notification, PMA approval, or a de novo classification order; ReWalk is classified as a Class II powered exoskeleton device and must comply with special controls; ReStore received 510(k) clearance - European Union: Medical devices are regulated by the EU Medical Device Regulation (MDR) 2017/745 and require CE marking - United Kingdom: Regulated by the Medical Devices Regulations 2002, with the CE Mark to be replaced by the UKCA Mark[103](index=103&type=chunk)[104](index=104&type=chunk)[106](index=106&type=chunk)[108](index=108&type=chunk)[109](index=109&type=chunk)[119](index=119&type=chunk)[120](index=120&type=chunk)[121](index=121&type=chunk) - Post-market regulatory requirements include establishing registration and device listings, quality assurance systems, labeling regulations, UDI requirements, medical device reporting, and corrective action reporting[112](index=112&type=chunk)[117](index=117&type=chunk) - The company must also comply with U.S. anti-kickback laws, false claims laws, HIPAA data privacy laws, and the Sunshine Act, among other healthcare fraud and abuse laws[124](index=124&type=chunk)[126](index=126&type=chunk)[129](index=129&type=chunk)[130](index=130&type=chunk)[131](index=131&type=chunk) - Healthcare reform measures, such as the Affordable Care Act (ACA), may impact medical product pricing and reimbursement, adversely affecting the company's business[144](index=144&type=chunk)[148](index=148&type=chunk) [U.S. Regulation](index=17&type=section&id=U.S.%20Regulation) US medical devices are regulated by the FDA, categorized into Class I, II, or III, requiring pre-market clearance (510(k), PMA, or de novo classification), with ReWalk classified as a Class II powered exoskeleton and ReStore receiving 510(k) clearance, all subject to post-market requirements - U.S. medical devices are regulated by the FDA, categorized into Class I, II, or III, requiring pre-market clearance through 510(k) notification, PMA approval, or a de novo classification order[103](index=103&type=chunk)[104](index=104&type=chunk)[106](index=106&type=chunk) - ReWalk received FDA "de novo" classification in June 2014, categorizing it as a Class II powered exoskeleton device subject to special controls[108](index=108&type=chunk) - ReStore received FDA 510(k) clearance in June 2019 for stroke patient rehabilitation[109](index=109&type=chunk) - Post-market regulatory requirements include compliance with Quality System Regulation (QSR), adverse event reporting, UDI requirements, and post-market surveillance[112](index=112&type=chunk)[114](index=114&type=chunk)[117](index=117&type=chunk) - The FDA confirmed in May 2022 that ReWalk had completed its 522 post-market study requirements[113](index=113&type=chunk) [Regulation outside of the U.S.](index=20&type=section&id=Regulation%20outside%20of%20the%20U.S.) Medical devices in the EU are regulated by the MDR 2017/745, requiring CE marking, while post-Brexit UK regulations (Medical Devices Regulations 2002) will replace CE with UKCA marking, and other jurisdictions have their own approval processes - Medical devices in the European Union are regulated by the EU Medical Device Regulation (MDR) 2017/745 and require CE marking[119](index=119&type=chunk)[120](index=120&type=chunk) - Following Brexit, medical devices in the United Kingdom are regulated by the Medical Devices Regulations 2002, and the CE Mark will be replaced by the UKCA Mark[121](index=121&type=chunk) - Sales in other jurisdictions require compliance with local government regulations and approval processes[122](index=122&type=chunk) [U.S. Anti-kickback, False Claims and Other Healthcare Fraud and Abuse Laws](index=20&type=section&id=U.S.%20Anti-kickback%2C%20False%20Claims%20and%20Other%20Healthcare%20Fraud%20and%20Abuse%20Laws) The company is subject to US anti-kickback, false claims, and healthcare fraud laws, including HIPAA and ACA, which prohibit inducements for product purchases, false claims to the government, and mandate reporting of payments to healthcare providers under the Sunshine Act, alongside data privacy regulations - Federal and state anti-kickback laws prohibit paying or receiving kickbacks to induce the purchase or recommendation of medical products and services[124](index=124&type=chunk) - The Civil False Claims Act (FCA) prohibits knowingly submitting false or fraudulent claims for payment to the federal government, which can result in treble damages and civil penalties[126](index=126&type=chunk) - Federal criminal statutes, including the Health Insurance Portability and Accountability Act (HIPAA) and the Affordable Care Act (ACA) amendments, prohibit healthcare fraud and abuse[129](index=129&type=chunk) - The Physician Payments Sunshine Act requires medical device manufacturers to annually report payments and other transfers of value made to healthcare providers[130](index=130&type=chunk) - The company is also subject to data privacy and security regulations, such as HIPAA, HITECH, GDPR, and CCPA[131](index=131&type=chunk)[261](index=261&type=chunk)[262](index=262&type=chunk) [Coverage and Reimbursement](index=22&type=section&id=Coverage%20and%20Reimbursement) Commercial success hinges on obtaining adequate coverage and reimbursement from government and private third-party payers, who increasingly restrict or regulate pricing, potentially limiting product access or requiring high co-payments, making favorable CMS coverage crucial for new product launches - The commercial success of products depends on government payers (Medicare, Medicaid), private health insurance companies, and other third-party payers providing coverage and establishing adequate reimbursement levels[136](index=136&type=chunk) - Government agencies and third-party payers are increasingly limiting or regulating the prices of medical products and services, which could result in average selling prices lower than anticipated[137](index=137&type=chunk) - Payers may restrict coverage for specific therapeutic products or require high co-payments to control costs[137](index=137&type=chunk)[142](index=142&type=chunk) - Obtaining favorable CMS coverage and reimbursement is often a critical issue for the successful launch of new products[140](index=140&type=chunk) [Healthcare Reform Measures](index=23&type=section&id=Healthcare%20Reform%20Measures) Healthcare reform measures in the US and abroad, such as the ACA and Budget Control Act of 2011, aim to control healthcare spending, potentially limiting government payments for medical products and services, restricting coverage and reimbursement, and reducing product demand - The United States and many foreign jurisdictions have enacted or proposed legislative and regulatory reforms to limit the growth of government healthcare spending[143](index=143&type=chunk) - The Patient Protection and Affordable Care Act (ACA) significantly altered healthcare financing and had a major impact on the pharmaceutical industry[144](index=144&type=chunk) - The Budget Control Act of 2011 resulted in a **2%** reduction in Medicare payments, and the Bipartisan Budget Act of 2018 extended this cut[146](index=146&type=chunk)[242](index=242&type=chunk) - Future healthcare reform measures may limit the amount governments pay for medical products and services, leading to restricted coverage and reimbursement, and reduced product demand[150](index=150&type=chunk) [Environmental Matters](index=24&type=section&id=Environmental%20Matters) The company adheres to environmental, health, and safety regulations concerning air and water emissions, chemical management, and waste disposal, with Israeli contract manufacturers requiring poison permits and EU products complying with WEEE and RoHS directives, affirming material compliance with applicable laws - The company complies with various environmental, health, and safety laws and regulations, including those concerning air emissions, water discharges, and the use, transportation, management, and disposal of chemicals and hazardous materials[151](index=151&type=chunk) - In Israel, contract manufacturers are required to obtain a poison permit under the Israeli Hazardous Substances Law[152](index=152&type=chunk) - In the EU market, electrical and electronic equipment must comply with the WEEE Directive (encouraging reuse and recycling) and the RoHS Directive (restricting the use of hazardous substances)[153](index=153&type=chunk) - The company believes it is in compliance with applicable environmental laws and regulations in all material respects[153](index=153&type=chunk) [Manufacturing](index=24&type=section&id=Manufacturing) The company contracts Sanmina Corporation to manufacture all its products, including ReWalk and ReStore, at its Ma'alot, Israel facility, enabling focus on technology development and commercialization with scalable production, while internally developing some software components and licensing others - The company contracts Sanmina Corporation to manufacture all its products, including ReWalk and ReStore, at its Ma'alot, Israel facility[154](index=154&type=chunk) - This contract manufacturing relationship allows the company to focus on technology development and commercialization, and provides scalable production capacity[155](index=155&type=chunk) - The company internally develops some software components and licenses other open-source software[156](index=156&type=chunk) - The company produces based on internal sales forecasts, aiming to deliver products within two weeks of receiving an order[156](index=156&type=chunk) [Suppliers](index=25&type=section&id=Suppliers) The company relies on Sanmina for most product components and raw materials, sourced globally, with some direct procurement; despite pandemic-driven electronic component price increases, current manufacturing and supply arrangements are deemed sufficient for foreseeable capacity needs - The company contracts Sanmina to procure all product components and raw materials, with some raw materials procured directly by the company[158](index=158&type=chunk) - Components and raw materials are sourced from suppliers in the United States, Europe, China, and Israel[158](index=158&type=chunk) - During the pandemic, prices for some electronic components increased[158](index=158&type=chunk) - The company believes its manufacturing and supply arrangements are sufficient to support foreseeable capacity needs[159](index=159&type=chunk) [Human Capital](index=25&type=section&id=Human%20Capital) As of December 31, 2022, the company employed **56** individuals primarily in sales, marketing, and R&D, adhering to local labor laws, offering competitive compensation and benefits, and fostering a diverse and inclusive work environment - As of December 31, 2022, the company had **56** employees (including full-time and hourly workers), with **24** in the United States, **17** in Israel, and **15** in Europe[159](index=159&type=chunk) - Most employees are engaged in sales and marketing activities[159](index=159&type=chunk) - The company complies with labor laws and regulations in the United States, Germany, and Israel, offering competitive compensation, bonuses, equity incentives, and comprehensive benefits programs[160](index=160&type=chunk)[161](index=161&type=chunk) - The company is committed to diversity and inclusion, encouraging different perspectives and striving to create an equal opportunity workplace[162](index=162&type=chunk) [Financial Information about Geographic Areas and Significant Customer Information](index=25&type=section&id=Financial%20Information%20about%20Geographic%20Areas%20and%20Significant%20Customer%20Information) In 2022, the company's total revenue was **$5.511 million**, an **8%** decrease from **$5.966 million** in 2021, with both the US and Europe being primary revenue sources experiencing declines, while Israel, Asia-Pacific, and Africa contributed smaller amounts Revenue by Customer Location (thousand dollars) | | 2022 | 2021 | | :--- | :--- | :--- | | Israel | 32 | — | | United States | 2,303 | 2,519 | | Europe | 3,057 | 3,381 | | Asia-Pacific | 115 | 60 | | Africa | 4 | 6 | | Total Revenue | 5,511 | 5,966 | - Total revenue in 2022 was **$5.511 million**, an **8%** decrease from 2021, primarily due to decreased U.S. rehabilitation equipment sales and unfavorable Euro to U.S. Dollar exchange rates[406](index=406&type=chunk) [ITEM 1A. RISK FACTORS](index=26&type=section&id=ITEM%201A.%20RISK%20FACTORS) [Risks Related to Our Business and Our Industry](index=26&type=section&id=Risks%20Related%20to%20Our%20Business%20and%20Our%20Industry) The company faces business and industry risks including global economic uncertainty, ongoing COVID-19 impacts, insufficient funding, Nasdaq delisting risk, new product development challenges, low market acceptance, reliance on a single manufacturer and limited suppliers, intense competition, non-exclusive distributors, high warranty claims, and inadequate R&D capabilities - Weak and uncertain global, regional, and local economic conditions could adversely affect demand for products and services and financial performance[166](index=166&type=chunk) - The COVID-19 pandemic has adversely affected, and may continue to adversely affect, business, operations, and financial results[168](index=168&type=chunk) - The company may not have sufficient capital to meet future operating needs or capital requirements, potentially necessitating dilutive equity or restrictive debt financing[172](index=172&type=chunk) - The company does not meet all Nasdaq Capital Market listing requirements, posing a risk of delisting[177](index=177&type=chunk) - Future growth and operating results depend on the ability to develop, obtain regulatory clearance for, and commercialize new products, as well as penetrate new markets[181](index=181&type=chunk) - The company relies on sales of ReWalk and ReStore systems and related service contracts and extended warranties, and may not achieve or maintain market acceptance[187](index=187&type=chunk) - The medical exoskeleton market is relatively new and unproven, and assumptions about the potential market may be inaccurate[190](index=190&type=chunk) - The company relies on a single third-party supplier (Sanmina) for product manufacturing and a limited number of third-party suppliers for certain components, posing risks of supply chain disruptions and operational challenges[216](index=216&type=chunk)[218](index=218&type=chunk) - The industry in which the company operates is highly competitive and rapidly changing, with competition expected to intensify[221](index=221&type=chunk) - The independent distributors utilized by the company may sell competing products[225](index=225&type=chunk) - The company may receive a significant number of warranty claims or ReWalk and ReStore systems may require substantial after-sales service[226](index=226&type=chunk) - The company may not be able to enhance its product offerings through research and development efforts[227](index=227&type=chunk) [Risks Related to Government Regulation](index=38&type=section&id=Risks%20Related%20to%20Government%20Regulation) The company faces government regulatory risks such as US healthcare reform, no guaranteed fast FDA approval for breakthrough devices, marketing compliance, manufacturing and labeling regulations, QSR compliance, anti-fraud and anti-bribery laws, patient health information confidentiality, and the compliance costs and management challenges of being a US public company and medical device manufacturer - FDA Breakthrough Device designation does not guarantee regulatory clearance or a faster clearance timeline[235](index=235&type=chunk) - U.S. healthcare reform measures and other potential legislative initiatives could adversely affect the company's business[238](index=238&type=chunk) - The company's devices are subject to FDA marketing and promotional communication regulations, and non-compliance could lead to enforcement actions[244](index=244&type=chunk) - The company is subject to extensive government regulations concerning the manufacturing, labeling, and marketing of its products, and non-compliance could lead to product withdrawals or recalls[246](index=246&type=chunk) - Failure by the company or its third-party manufacturer to comply with FDA's Quality System Regulation (QSR) could lead to disruptions in manufacturing operations[255](index=255&type=chunk) - The company is subject to various laws and regulations, including "fraud and abuse" laws and anti-bribery laws, and violations could result in substantial penalties[257](index=257&type=chunk) - If the company is found to be in violation of laws protecting the confidentiality of patient health information, it could face civil or criminal penalties[261](index=261&type=chunk) - Compliance with various regulations as a U.S. public company and medical device manufacturer could lead to increased administrative expenses, management distraction, and compliance challenges[264](index=264&type=chunk) [Risks Related to Our Intellectual Property and Information Technology](index=43&type=section&id=Risks%20Related%20to%20Our%20Intellectual%20Property%20and%20Information%20Technology) The company's success relies partly on intellectual property protection but faces risks from patent validity uncertainty, high litigation costs, trade secret disclosure, IT system failures, and cybersecurity attacks, potentially leading to loss of competitive advantage, legal liabilities, and business disruptions - The company relies on computer and telecommunications systems that it does not own or control, and system failures or cybersecurity attacks could severely disrupt business operations or lead to the disclosure of sensitive customer information[269](index=269&type=chunk) - The company's success is partly dependent on obtaining and maintaining protection for intellectual property related to its products[274](index=274&type=chunk) - The patent landscape for robotic and exoskeleton inventions is highly uncertain, and patent laws and interpretations may change, potentially weakening patent value or narrowing the scope of protection[275](index=275&type=chunk) - Intellectual property litigation can be time-consuming and expensive, potentially leading to patent invalidation or narrow interpretation[276](index=276&type=chunk) - The company relies on trademark protection to distinguish its products, but trademarks may be challenged or infringed upon[289](index=289&type=chunk) - The company may face claims from employees or other companies regarding the improper use or disclosure of former employers' trade secrets[290](index=290&type=chunk) [Risks Related to Ownership of Our Ordinary Shares](index=46&type=section&id=Risks%20Related%20to%20Ownership%20of%20Our%20Ordinary%20Shares) Ownership of the company's ordinary shares carries multiple risks, including potential dilution from large stock sales or warrant exercises, future equity incentive plans, failure to meet analyst expectations, reduced investor appeal as a 'smaller reporting company,' internal control compliance costs, adverse tax consequences if deemed a PFIC, and stock price volatility - Significant sales of ordinary shares by the company or major shareholders, or large exercises of warrants by holders, could adversely affect the value of ordinary shares[291](index=291&type=chunk) - Future grants of ordinary shares to employees, non-employee directors, and consultants under equity incentive plans, or sales of shares by these individuals in the open market, could result in substantial dilution[295](index=295&type=chunk) - If the company fails to meet the expectations of equity research analysts, or if analysts cease publishing research reports or issue unfavorable comments, the stock price could decline[297](index=297&type=chunk) - The company's status as a "smaller reporting company" and its simplified reporting requirements may reduce the attractiveness of its ordinary shares to investors[300](index=300&type=chunk) - The company faces ongoing costs and risks in determining whether its existing internal control over financial reporting system complies with Section 404 of the Sarbanes-Oxley Act, and failure to maintain adequate internal controls could materially adversely affect financial performance and reputation[302](index=302&type=chunk) - If the company is deemed a passive foreign investment company (PFIC), U.S. holders of ordinary shares may face adverse U.S. tax consequences[306](index=306&type=chunk) - The price of the company's ordinary shares may fluctuate, and investors could lose all or part of their investment[313](index=313&type=chunk) [Risks Related to Our Incorporation and Location in Israel](index=50&type=section&id=Risks%20Related%20to%20Our%20Incorporation%20and%20Location%20in%20Israel) The company's Israeli operations face risks from political and military instability, employee military service, boycotts, termination of tax benefits, government funding restrictions on technology transfer, and employee invention claims, while Israeli law and articles of association may hinder M&A, and US court judgments may be difficult to enforce - The company's technology development and quality headquarters, as well as its contract manufacturer's facilities, are located in Israel; therefore, economic restrictions and political and military instability in Israel could adversely affect the company's business[315](index=315&type=chunk) - Military service obligations for Israeli citizens could disrupt the operations of the company and its contract manufacturer[318](index=318&type=chunk) - Boycotts against Israel could adversely affect the sales of the company's products[319](index=319&type=chunk) - Tax benefits available to the company require meeting various conditions and may be terminated or reduced in the future, increasing costs and taxes[320](index=320&type=chunk) - The company has received funding from the Israeli government for its R&D activities, and the terms of these grants restrict the company's ability to manufacture products or transfer technology outside of Israel, or may require penalty payments if the company is sold[321](index=321&type=chunk) - The company may face claims from employees regarding their rights to compensation or royalties for service inventions[325](index=325&type=chunk) - Provisions of Israeli law and the company's articles of association may delay, prevent, or otherwise hinder mergers or acquisitions of the company[326](index=326&type=chunk) - Judgments rendered against the company, its officers, and directors in U.S. courts may be difficult to enforce in Israel, or it may be difficult to assert U.S. securities law claims or serve process in Israel[333](index=333&type=chunk) [General Risks](index=54&type=section&id=General%20Risks) The company faces profitability risks from currency exchange rate fluctuations (USD, EUR, NIS), changes in international trade and anti-bribery laws, fiscal and tax policy adjustments, IT system disruptions, and challenges in managing growth, while also being highly dependent on senior management and potentially impacted by US federal government shutdowns - Fluctuations in exchange rates between the U.S. Dollar, Euro, and New Israeli Shekel could adversely affect the company's profitability[339](index=339&type=chunk) - The company is subject to various regulatory regimes that may affect international operations, and failure to comply with applicable laws and regulations could harm its reputation and lead to fines and increased costs[344](index=344&type=chunk) - Changes in fiscal and tax policies could have a significant impact on the company's business and result in potential negative or unexpected tax consequences[346](index=346&type=chunk) - If the company is deemed a controlled foreign corporation (CFC), U.S. holders of ordinary shares may face adverse U.S. tax consequences[348](index=348&type=chunk) - Significant disruptions to information technology systems could adversely affect the company's business, financial condition, and results of operations[350](index=350&type=chunk) - If the company fails to properly manage anticipated growth, its business could be harmed[352](index=352&type=chunk) - The company is highly dependent on the knowledge and skills of its senior management, and failure to attract and retain highly qualified personnel may prevent successful implementation of business strategies[353](index=353&type=chunk) - A U.S. federal government shutdown could severely harm the company's business and financial condition[355](index=355&type=chunk) [ITEM 1B. UNRESOLVED STAFF COMMENTS](index=57&type=section&id=ITEM%201B.%20UNRESOLVED%20STAFF%20COMMENTS) There are no unresolved staff comments in this report - There are no unresolved staff comments in this report[356](index=356&type=chunk) [ITEM 2. PROPERTIES](index=57&type=section&id=ITEM%202.%20PROPERTIES) The company's headquarters are in Yokneam, Israel, with US operations in Marlborough and European operations in Berlin, Germany; all facilities are leased, totaling approximately **24,297 square feet**, and are considered sufficient for current needs - The company's headquarters are located in Yokneam, Israel, its U.S. headquarters in Marlborough, Massachusetts, and its European headquarters in Berlin, Germany - All facilities are leased, and the company does not own any real estate - The company believes its facilities are sufficient to meet current needs[357](index=357&type=chunk)[358](index=358&type=chunk) Leased Property Area (approximate, square feet) | Location | Area (square feet) | | :--- | :--------------- | | Marlborough, Massachusetts | 11,850 | | Yokneam, Israel | 11,500 | | Berlin, Germany | 947 | | Total | 24,297 | [ITEM 3. LEGAL PROCEEDINGS](index=57&type=section&id=ITEM%203.%20LEGAL%20PROCEEDINGS) The company is occasionally involved in various legal claims, lawsuits, and regulatory investigations arising in the ordinary course of business, for which it accrues losses when probable and estimable, but does not believe any pending or threatened matters will materially adversely affect its consolidated operating results, liquidity, or financial condition - The company is occasionally involved in various legal claims, lawsuits, and regulatory investigations, most of which arise in the ordinary course of business[359](index=359&type=chunk) - The company accrues for losses when they are probable and the amount can be reasonably estimated[359](index=359&type=chunk) - The company does not believe that any pending or threatened legal matters will have a material adverse effect on its consolidated operating results, liquidity, or financial condition[360](index=360&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURES](index=57&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) Not applicable - Not applicable[362](index=362&type=chunk) [ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES](index=58&type=section&id=ITEM%205.%20MARKET%20FOR%20REGISTRANT%27S%20COMMON%20EQUITY%2C%20RELATED%20STOCKHOLDER%20MATTERS%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) [Market Information](index=58&type=section&id=Market%20Information) The company's ordinary shares began trading on the Nasdaq Global Market on September 12, 2014, transferred to the Nasdaq Capital Market on May 25, 2017, and had approximately **278,511** registered shareholders as of February 23, 2023 - The company's ordinary shares began trading on the Nasdaq Global Market on September 12, 2014, and transferred to the Nasdaq Capital Market on May 25, 2017[365](index=365&type=chunk) - As of February 23, 2023, the company had approximately **278,511** registered shareholders[365](index=365&type=chunk) [Dividend Policy](index=58&type=section&id=Dividend%20Policy) The company has never declared or paid cash dividends and does not anticipate doing so in the foreseeable future, planning to retain future earnings to fund operations and business expansion, with dividend distributions restricted by Israeli law to retained earnings or court approval - The company has never declared or paid any cash dividends and does not expect to do so in the foreseeable future[366](index=366&type=chunk) - The company plans to retain any future earnings to fund operations and business expansion[366](index=366&type=chunk) - Dividend distributions are restricted by Israeli law, allowing distribution only from retained earnings or with Israeli court permission[366](index=366&type=chunk) [Israeli Taxes Applicable to U.S. Holders](index=58&type=section&id=Israeli%20Taxes%20Applicable%20to%20U.S.%20Holders) Non-Israeli residents selling shares in Israeli public companies are generally exempt from Israeli capital gains tax under certain conditions, while dividends paid to non-Israeli residents are typically subject to **25%** or **30%** Israeli income tax, potentially reduced by tax treaties, with US residents possibly eligible for federal income tax credits - Capital gains derived by non-Israeli residents from the sale of shares in Israeli public companies are generally exempt from Israeli tax, provided certain conditions are met, such as the shares not being held through a permanent establishment in Israel[367](index=367&type=chunk) - Dividends paid to non-Israeli residents are generally subject to Israeli income tax at a rate of **25%** or **30%**, with the specific tax rate potentially reduced by applicable tax treaties[371](index=371&type=chunk) - Under the U.S.-Israel tax treaty, dividends paid to U.S. residents are subject to a maximum Israeli withholding tax rate of **25%**, which may be reduced to **15%** or **12.5%** in certain circumstances[371](index=371&type=chunk) - U.S. residents may be entitled to a U.S. federal income tax credit after paying Israeli withholding tax[371](index=371&type=chunk) - Israeli individuals with annual income exceeding a certain threshold (**NIS 663,240** in 2022) are subject to an additional **3%** tax[372](index=372&type=chunk) [Recent Sales of Unregistered Equity Securities](index=59&type=section&id=Recent%20Sales%20of%20Unregistered%20Equity%20Securities) All sales of unregistered equity securities during the reporting period have been disclosed in Form 8-K or Form 10-Q quarterly reports - All sales of unregistered equity securities during the reporting period have been disclosed in Form 8-K or Form 10-Q quarterly reports[373](index=373&type=chunk) [Purchases of Equity Securities by the Issuer and Affiliated Purchasers](index=59&type=section&id=Purchases%20of%20Equity%20Securities%20by%20the%20Issuer%20and%20Affiliated%20Purchasers) The company initiated a stock repurchase program in June 2022, with board approval to repurchase up to **$8 million** of ordinary shares, extended by an additional **$5.8 million** in December 2022, resulting in the repurchase of approximately **2.9 million** ordinary shares for a total cost of **$2.6 million** as of December 31, 2022 - The company initiated a stock repurchase program in June 2022, with the Board of Directors approving the repurchase of up to **$8 million** of ordinary shares, and further approving an extension of the repurchase program by an additional **$5.8 million** in December 2022[374](index=374&type=chunk)[376](index=376&type=chunk)[459](index=459&type=chunk)[460](index=460&type=chunk) Q4 2022 Stock Repurchase Activity (thousand dollars) | Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of a Publicly Announced Plan | Maximum Value of Shares That May Yet Be Purchased Under the Plan | | :----------------------- | :----------------------------- | :--------------------------- | :----------------------------------------------------------------- | :------------------------------------------------------------- | | October 1 - October 30, 2022 | 529,319 | $0.90 | 529,319 | $7,330 | | November 1 - November 30, 2022 | 1,056,776 | $0.94 | 1,056,776 | $6,317 | | December 1 - December 31, 2022 | 1,162,484 | $0.80 | 1,162,484 | $5,358 | | Quarter Total | 2,748,579 | $0.87 | 2,748,579 | $5,358 | - As of December 31, 2022, the company had repurchased approximately **2.9 million** ordinary shares at a total cost of **$2.6 million**[462](index=462&type=chunk) - Between January 1 and January 20, 2023, the company repurchased an additional **730,350** ordinary shares under the repurchase program for a total consideration of **$628,477**[376](index=376&type=chunk) [ITEM 6. [RESERVED]](index=60&type=section&id=ITEM%206.%20%5BRESERVED%5D) This item is reserved and contains no content [ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=60&type=section&id=ITEM%207.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) [Overview](index=60&type=section&id=Overview) The company is a medical device firm developing mobility and health technologies for neurological disorders, featuring ReWalk SCI exoskeletons, ReStore stroke exoskeletons, and MyoCycle distribution, primarily targeting US and European markets with revenue from third-party payers and self-pay individuals, while ReBoot soft exoskeleton development is paused - The company designs, develops, and commercializes innovative technologies aimed at providing rehabilitation and daily living mobility and health support for individuals with neurological disorders[379](index=379&type=chunk) - Primary products: ReWalk Personal and ReWalk Rehabilitation exoskeleton devices (for spinal cord injury), ReStore Exo-Suit device (for stroke rehabilitation) - Distributed products: MYOLYN MyoCycle FES Pro cycling device (exclusive U.S. distribution), MediTouch Tutor motion biofeedback system (distribution terminated) - Products in development: ReBoot (personal soft exoskeleton for post-stroke home and community use), which received FDA Breakthrough Device designation, but further investment was paused in 2023[379](index=379&type=chunk)[380](index=380&type=chunk)[381](index=381&type=chunk) - Primary markets are the United States and Europe, with revenue derived from third-party payers (including private and government payers) and self-pay individuals[382](index=382&type=chunk)[383](index=383&type=chunk) - The company is actively pursuing coverage and reimbursement from Medicare and German health insurance[385](index=385&type=chunk)[386](index=386&type=chunk) [Components of Our Statements of Operations](index=61&type=section&id=Components%20of%20Our%20Statements%20of%20Operations) This section details the company's statement of operations components, including revenue from product sales, leases, service contracts, and extended warranties, cost of revenue and gross profit, operating expenses (R&D, S&M, G&A), net financial expenses (income), income taxes, and government grants - Revenue primarily derives from sales and leases of ReWalk Personal and ReWalk Rehabilitation exoskeleton devices, sales of ReStore exoskeleton devices, sales of distributed products, and related extended service contracts - Revenue sources include third-party payers (private and government employers, institutions) and self-pay individuals, with third-party payers expected to become an increasingly important revenue source - Cost of revenue primarily includes the cost of systems procured from outsourced manufacturer Sanmina, internal personnel costs, manufacturing and inventory management, training and inspection, warranty and service activities, freight, and inventory impairment provisions - Gross profit and gross margin are affected by product sales volume, pricing, product mix, and fluctuations in cost of revenue, and are expected to expand in the future with revenue growth and economies of scale - Research and development expenses primarily include personnel costs, materials, consulting fees, clinical research, regulatory filings, and patent costs, net of R&D grants received - Sales and marketing expenses primarily include personnel costs related to sales, marketing, and reimbursement, travel, advertising, trade shows, lobbying, and public relations activities - General and administrative expenses primarily include administrative, finance, and management personnel costs, professional service fees, and insurance premiums - Net financial expenses (income) include b

Financial Data and Key Metrics Changes - ReWalk reported revenues for Q3 2022 of $886,000, a decrease from $2 million in Q3 2021, and for the nine months ended September 30, 2022, revenues were $3.3 million compared to $4.7 million in the same period of the previous year [18][19] - The gross margin for Q3 2022 was 25%, down from 58% in the prior year's quarter, primarily due to fixed production costs and rising production costs [23] - The net loss for Q3 2022 was $5.5 million or $0.09 per share, compared to a net loss of $2.7 million or $0.06 per share in Q3 2021 [27] Business Line Data and Key Metrics Changes - Sales of ReWalk exoskeleton units were adversely affected by the timing of coverage decisions by insurers and delays in training schedules [19] - In Q3 2022, ReWalk generated approximately $250,000 from the sale of MYOLYN MyoCycles, marking the highest quarterly performance for this product line [20] - The current pipeline of active rentals consists of 26 cases, with a total of 74 cases in process, including 56 in Germany and 18 in the U.S. [22] Market Data and Key Metrics Changes - The U.S. and German markets were almost fully open, allowing for training and placement for home systems, which is expected to improve sales cycles [29] - The capital budgets for clinic-based products are constrained, leading to delays in some planned purchases [30] Company Strategy and Development Direction - The company is focused on establishing coverage for exoskeletons through public and private insurance, with submissions to Medicare administrative contractors (MACs) underway [9][11] - ReWalk is pursuing additional commercial product lines to leverage its organizational structure and achieve profitability [32] - The company aims to submit two FDA device applications for improved ReWalk designs, with the first submission made in June 2022 and the second expected in Q1 2023 [36] Management's Comments on Operating Environment and Future Outlook - Management indicated that the timing of reimbursement decisions has delayed revenue growth expectations for 2022, but many deferred cases are anticipated to conclude in Q4 [31] - The company remains focused on execution to enhance shareholder value and improve patient outcomes [38] Other Important Information - ReWalk's operating expenses for Q3 2022 were $5.7 million, up from $3.8 million in the prior year's quarter, driven by increased R&D and sales and marketing expenses [24][25] - The company ended the quarter with $74 million in cash and cash equivalents and no debt, indicating a strong balance sheet [27][28] Q&A Session Summary - There were no questions during the Q&A session, and the operator concluded the conference call [40][41]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____ to ______ Commission File Number: 001-36612 ReWalk Robotics Ltd. (Exact name of registrant as specified in charter) | Israel | Not applicable | | --- | --- | | ...