PROCEPT BioRobotics (PRCT) - 2025 Q4 - Annual Report

Financial Performance - The company generated revenue of $308.1 million for the year ended December 31, 2025, compared to $224.5 million for 2024, reflecting a year-over-year increase of approximately 37.2%[30] - The company incurred a net loss of $95.6 million for the year ended December 31, 2025, compared to a net loss of $91.4 million for 2024, indicating continued operating losses[30] - The company has an accumulated deficit of $641.6 million as of December 31, 2025, indicating ongoing financial challenges[30] Market Opportunity - The total addressable market opportunity for the company's products in the United States is estimated to be approximately $30 billion, targeting around 8.0 million patients[22] - The total addressable market opportunity for BPH treatment in the U.S. is estimated to be approximately $30 billion, including men receiving drug therapy, those who have recently failed medication, and those undergoing surgical intervention[34] - Approximately 40 million men in the U.S. are impacted by symptoms of BPH, with 12 million being managed by a physician for related symptoms[34] Product Efficacy and Safety - The company’s Aquablation therapy demonstrated a surgical retreatment rate of only 5.2% at five years in pivotal studies, which is favorable compared to traditional treatments[25] - Aquablation therapy demonstrated a transfusion rate of only 0.8% in a study of 2,089 men, significantly lower than the 25% rate associated with traditional procedures[53] - Clinical studies have shown incontinence rates between 0%-2% and ejaculatory dysfunction rates between 6.9%-24.6% for Aquablation therapy[53] - The WATER III study showed Aquablation therapy provided similar symptom relief to laser enucleation while achieving a zero percent transfusion rate and lower rates of ejaculatory dysfunction and incontinence[66] Clinical Data and Research - The company has developed a significant body of clinical data, including nine clinical studies and over 150 peer-reviewed publications, supporting the efficacy and safety of Aquablation therapy[26] - The OPEN WATER study included a diverse patient population with prostate sizes between 20 ml and 150 ml, providing robust data for Aquablation therapy[66] Regulatory and Compliance - The company is subject to extensive regulation by the FDA and other authorities, impacting the development and commercialization of its products[103] - The company must obtain new 510(k) clearance or PMA approval for any significant modifications to devices post-clearance[109] - The FDA can enforce compliance actions, including recalls and fines, if the company fails to meet regulatory requirements[116] - The company is subject to extensive post-market surveillance requirements to monitor device performance and safety[125] - Compliance with the Quality Management System Regulation (QMSR) is necessary to continue marketing cleared or approved products in the U.S.[115] - The European Union's Medical Device Regulation (MDR) requires all devices to be certified under its guidelines, impacting market access[121] - The company must comply with General Safety and Performance Requirements (GSPRs) to affix the CE Mark to devices in the EU[122] - The company faces significant penalties under the federal civil False Claims Act for presenting false claims related to government funds[132] - The company must navigate various foreign regulations for marketing products outside the U.S., which can vary significantly by country[117] - The company is required to maintain compliance with anti-kickback laws and transparency regulations regarding payments to healthcare providers[128] Strategic Initiatives - The company aims to establish Aquablation therapy as the surgical treatment of choice for BPH, targeting urologists who perform resective procedures[31] - The company plans to invest in two single-arm prostate cancer clinical trials and one randomized FDA-approved pivotal IDE clinical trial to support the use of Aquablation therapy for prostate cancer[35] - The company intends to increase awareness of Aquablation therapy beyond the urology community, particularly among primary care physicians managing BPH patients[35] - The company plans to expand its direct sales organization to drive awareness and adoption of Aquablation therapy among urologists[68] - The company is committed to expanding its international market presence while continuing to promote the clinical benefits of Aquablation therapy[35] - The company plans to leverage treatment data and software development capabilities to integrate artificial intelligence and machine learning into its products[35] - The introduction of the FirstAssist AI feature in the HYDROS Robotic System aims to enhance procedural accuracy by assisting surgeons in identifying anatomical landmarks[58] Employee and Corporate Governance - The company had 888 employees as of December 31, 2025, indicating a focus on human capital resources[143] - The company emphasizes a diverse workplace to enhance employee experience and drive superior results[144] - The company has published its Environmental, Social, and Governance (ESG) Report annually since 2022, detailing human capital programs[145] - The company invests in employee health, safety, and wellness programs, supporting physical, mental, emotional, and financial well-being[148] - Compensation programs are designed to align employee compensation with company performance, including annual bonuses and equity awards[149] - The company fosters professional growth through stretch assignments, coaching, and mentoring to help employees achieve career goals[151] - An annual global performance review process is in place to assess employee performance and support equitable compensation recommendations[152] - The company conducts periodic engagement surveys to improve employee retention and address areas of concern[153] Competitive Landscape - The company faces intense competition from both resective surgical treatments and non-surgical treatments for BPH, with competitors having greater resources and established market presence[87] - Medicare accounts for approximately 50% of all hospital-based resective BPH procedures performed in the United States[78] - The company estimates that access to Aquablation therapy is available to approximately 95% of all men in the United States due to favorable coverage decisions from large commercial payors[77] Intellectual Property - As of December 31, 2025, the company holds rights to 73 issued U.S. patents and 157 issued foreign patents, with expiration dates ranging from 2028 to 2042[91] - The company has entered into exclusive license agreements with AquaBeam LLC and HydroCision, with the latter involving a payment of $2.5 million in 2019[98][101] - The company's robotic systems are classified as Class II medical devices and have received FDA clearance through the 510(k) premarket notification process[105][107]