CLPT 10-K & 10-Q changes, risk factors and insider trading
ClearPoint Neuro, Inc. · Nasdaq · Surgical & Medical Instruments & Apparatus · CIK 1285550 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “We may fail to realize the anticipated benefits of our acquisition of IRRAS, and the combined company may not perform as we or the market expect, which could adversely affect our business, results of operations, and the price of our common stock.”
New heading “Our future business growth is dependent on our ability to market and sell both the ClearPoint system and the IRRAflow system, and on our ability to integrate and effectively manage a combined commercial team that must support two distinct product platforms; our limited experience selling the ClearPoint system in the operating room may further increase these challenges.”
New heading “Limitations in the existing clinical evidence for the IRRAflow system may affect clinical and commercial adoption.”
New heading “We rely on single facilities for manufacturing and performance of services, which exposes us to significant risk of disruption.”
New heading “Our use of hazardous materials in manufacturing and in the conduct of services may exposes us to significant health, safety, environmental, and regulatory risks.”
New heading “Our role as a collaborator, funder, and sponsor of current and future clinical studies in connection with the IRRAflow system requires significant resources, and in some cases, may limit our ability to control the conduct and outcomes of these studies. Negative or unfavorable results from these clinical studies could adversely impact adoption of our IRRAflow products.”
New heading “Our acquisition activities, including our recent acquisition of IRRAS, may expose us to heightened cybersecurity risks that could adversely affect our business, financial condition, and results of operations.”
New heading “We currently have significant debt and may incur additional debt. Failure by us to fulfill our obligations under the applicable debt agreements may cause repayment obligations to accelerate. These agreements also contain certain covenants that restrict our operational and financial flexibility.”
New heading “The success of our biologics and drug delivery business is dependent on timely regulatory approval and commercialization of cell and gene therapies.”
New heading “A government shutdown or prolonged lapse in federal appropriations could materially delay or disrupt FDA review and approval processes critical to our business, which could have a material adverse effect on our financial condition and results of operations.”
Removed heading “A portion of our future business growth is dependent upon marketing and selling our ClearPoint system, and other new products, in the operating room, and if we are unable to expand, manage and maintain our marketing and sales capabilities in this environment, we may be unable to generate significant growth in our product revenues.”
Removed heading “Our internal manufacturing operations are generally conducted at a single location, which may limit our ability to provide an adequate supply of our products, and any disruption at our manufacturing facility could render us unable to produce our products, increase our expenses and decrease our revenue.”
Removed heading “The results of our clinical trials may not support our product candidate claims or any additional claims we may seek for our products and may result in the discovery of adverse side effects.”
Largest changes
“we may become subject to litigation, investigations, proceedings, fines or penalties arising from or relating to the transaction or the acquired business, and any resulting liabilities may exceed our forecasts;”see in full comparison
“We may engage in acquisition activity as part of our growth strategy, including our recent acquisition of IRRAS. Newly acquired companies may rely on information and operational technology systems that differ materially from our own and may not have cybersecurity protections comparable to those we have implemented. The integration of core systems and processes for such transactions often occurs after closing, which may create an elevated risk of cyber incidents during the intervening period. …”see in full comparison
Changes in domestic and global economic conditions, such as persistent inflationary pressure, higher interest rates, changes in monetary policy,see in full comparisondecreasingdeclining consumer and business confidence and spending, supply chain disruptions, the introduction of or changes in tariffs or trade barriers, and the potential for global or local recession may adversely impact the demand for our products and services, which could negatively impact our business, financial conditions, and results of operations. The world’s financial markets remain susceptible to significant stresses,resultingincludinginreducedreductions in available creditliquidity andgovernmentaccessspending,toeconomiccredit,downturnincreasedorborrowingstagnation,costs, foreign currencyfluctuationsfluctuations, and volatility in the valuations of securities generally. As a result, our ability to access capital marketsandor other funding sources in the future may be limited or may not be available on commercially reasonable terms, if at all.Impacts from inflationary pressures, could increase our costs for research and development of our products, and administrative and other costs of doing business, which could in turn increase the costs for producing and distributing our products and services. In a higher inflationary environment, we may be unable to raise the prices of our products and services to sufficiently keep up with the rate of inflation. Impacts from inflationary pressures could be more pronounced and adversely impact aspects of our business where revenue streams and price commitments are linked to contractual agreements that extend further into the future, as we may not be able to quickly or easily adjust pricing, reduce costs, or implement countermeasures.
“We currently have significant debt and may incur additional debt. Failure by us to fulfill our obligations under the applicable debt agreements may cause repayment obligations to accelerate. These agreements also contain certain covenants that restrict our operational and financial flexibility.”see in full comparison
“Inflationary pressures and elevated interest rates could increase our costs for research and development, supply chain, labor, and other administrative expenses, which could in turn raise the cost of producing and distributing our products and services. In such environments, we may be unable to increase prices sufficiently to offset these higher costs. These impacts could be more pronounced in areas of our business where pricing is governed by long-term contractual arrangements, as we may not be able to quickly or easily adjust pricing, reduce costs, or implement countermeasures.”see in full comparison
“Our role as a collaborator, funder, and sponsor of current and future clinical studies in connection with the IRRAflow system requires significant resources, and in some cases, may limit our ability to control the conduct and outcomes of these studies. Negative or unfavorable results from these clinical studies could adversely impact adoption of our IRRAflow products.”see in full comparison
Full comparison: every changed paragraph (139)
Any investment in our common stock involves a high degree of risk. You should consider carefully the risks and uncertainties described below and all information contained in this Annual Report before you decide whether to purchase our common stock. If any of the following risks or uncertainties actually occurs, our business, financial condition, results of operations and prospects would likely suffer, possibly materially. In addition, the trading price of our common stock could decline due to any of these risks or uncertainties, and you may lose part or all of your investment. The matters described below reflect our beliefs and views as to factors, events or contingencies that could materially and adversely affect our business, financial condition, results of operations, and growth prospects, and/or the price of our common shares in the future. References in this section to past events or conditions are provided by way of example only and are not intended to be a complete listing or a representation as to whether or not the factors,events or contingencies discussed below have occurred in the past or their likelihood of occurring in the future.
Changes in domestic and global economic conditions, such as persistent inflationary pressure, higher interest rates, changes in monetary policy, decreasingdeclining consumer and business confidence and spending, supply chain disruptions, the introduction of or changes in tariffs or trade barriers, and the potential for global or local recession may adversely impact the demand for our products and services, which could negatively impact our business, financial conditions, and results of operations. The world’s financial markets remain susceptible to significant stresses, resultingincluding inreduced reductions in available creditliquidity and governmentaccess spending,to economiccredit, downturnincreased orborrowing stagnation,costs, foreign currency fluctuationsfluctuations, and volatility in the valuations of securities generally. As a result, our ability to access capital markets andor other funding sources in the future may be limited or may not be available on commercially reasonable terms, if at all. Impacts from inflationary pressures, could increase our costs for research and development of our products, and administrative and other costs of doing business, which could in turn increase the costs for producing and distributing our products and services. In a higher inflationary environment, we may be unable to raise the prices of our products and services to sufficiently keep up with the rate of inflation. Impacts from inflationary pressures could be more pronounced and adversely impact aspects of our business where revenue streams and price commitments are linked to contractual agreements that extend further into the future, as we may not be able to quickly or easily adjust pricing, reduce costs, or implement countermeasures.
Inflationary pressures and elevated interest rates could increase our costs for research and development, supply chain, labor, and other administrative expenses, which could in turn raise the cost of producing and distributing our products and services. In such environments, we may be unable to increase prices sufficiently to offset these higher costs. These impacts could be more pronounced in areas of our business where pricing is governed by long-term contractual arrangements, as we may not be able to quickly or easily adjust pricing, reduce costs, or implement countermeasures.
Additionally,In addition, our hospitalhospital, pharmaceutical, and pharmaceuticalbiotechnology customers couldmay experience heightened financial and operational pressures as a result of macroeconomic conditionsconditions. whichSuch couldpressures impactmay theirinclude ability to access capital markets and other funding sources, increaseincreased cost of funding, causereduced access to capital markets, cash flow problems,challenges, or impededifficulties their ability to complycomplying with debt covenants,covenants. whichThese conditions could, in turn couldturn, impede theirour hospital customers’ ability to provide patient care,care conductor reduce budgets for new capital equipment and technologies. Government funding cuts have further constrained hospital and healthcare system budgets, which may limit their ability to invest in new technologies and slow adoption of our products. Our pharmaceutical and biotechnology customers who are engaged in gene and cell therapy development, may face reduced availability of research and development,development marketingfunding, andwhich could slow the pace of innovation, delay clinical trials, or constrain commercialization efforts,efforts. or impact their profitability. To the extent that our customers continue to faceAny such financialcustomer pressures,constraints itmay couldadversely impactaffect their willingness or ability to spend onpurchase our products and servicesservices, or may impair their ability to make payment,timely payments, either of which could adverselynegatively affectimpact our business, financial conditioncondition, and results of operations. Further,Moreover, withbroader economic uncertainty, an increase inelevated unemployment rates,levels, and increasingrising health insurance premiums, co-paymentsco-payments, and deductibles may resultlead into cost-conscious consumers pursuing fewer elective or advanced medical treatmentstreatments, and procedures, which, in turn,which could adversely affectreduce procedure volumes and the demand for our products and services.
Geopolitical changes and trends such as populism, protectionism, economic nationalism, as well as trade barriers,tariffs, sanctions, and regulationsother trade restrictions may become disruptive and costly to our business. The global economy has been, and may continue to be, negatively impactedaffected by the ongoing conflictconflicts, resulting fromincluding Russia’s invasion of UkraineUkraine, in 2022, uncertaintyinstability in the Middle EastEast, and heightened tensions in the Asia-Pacific region, orparticularly thewith increasingrespect tensions betweento China and Taiwan. These geopolitical developments may interfere with our supply chain, productionmanufacturing costs, access to raw materials, and customer relationships. In addition, market uncertainty and volatility in various geographies may be magnified as a result of potential shifts in U.S. and foreign trade, economiceconomic, and otherregulatory policies following the recent U.Selections. elections.Geopolitical uncertainty has also prompted many pharmaceutical and biotechnology companies to prefer sourcing from suppliers located closer to their manufacturing and research operations, or within their home markets, as a strategy to reduce exposure to security risks and cross-border disruptions. If we are unable to align with these preferences or establish sufficient local presence in key markets, our competitiveness with respect to certain international customers may be diminished. Although the majority of our operations takeare placebased in the U.S.,United States, further escalation of geopolitical tensions could make it more costly or difficult to continuemaintain our current international business or expand tointo serve otheradditional markets, which maycould adversely affect our business, financial conditioncondition, and results of operations.
We may fail to realize the anticipated benefits of our acquisition of IRRAS, and the combined company may not perform as we or the market expect, which could adversely affect our business, results of operations, and the price of our common stock.
On November 6, 2025, we entered into an Agreement and Plan of Merger and Reorganization (the “Merger Agreement”) with IRRAS Holdings, Inc. (“IRRAS”), a medical technology company focused on products used in neurocritical care, including treatments for intracerebral hemorrhage, intraventricular hemorrhage, and other conditions requiring intracranial fluid management. The transaction closed in the fourth quarter of 2025.
We pursued the acquisition based on expectations that the transaction would enhance our commercial scale, expand our presence into neurocritical care, drive operational efficiencies, and support our long term strategy of central nervous system drug delivery innovation. These anticipated benefits are inherently subject to uncertainties and are based on assumptions regarding the performance of the combined businesses. There can be no assurance that the expected synergies, growth opportunities, or operating efficiencies will be realized on the timeline anticipated, or at all. If we do not achieve these anticipated benefits, our financial condition, results of operations, and the market price of our common stock could be adversely affected.
The combined company may not perform as we or the market expect. Risks associated with integrating IRRAS into our business include:
integrating the operations, systems, technologies, and personnel of IRRAS is a complex, costly, and time-consuming process, and any failure to do so effectively could adversely affect our financial condition and operating results;
differences in corporate cultures, policies, procedures, internal controls, and operating practices may be more difficult or take longer to harmonize than anticipated;
key employees of either company may choose not to remain with the combined company, and the loss of such personnel could adversely affect our operations, technical capabilities, or commercial execution;
the success of the combined company depends in part on the retention of key customer and supplier relationships, and the merger may cause disruptions or changes in these relationships and behavior that negatively affect revenue;
we may incur significant integration related costs, including costs related to aligning systems, processes, facilities, and commercial organizations;
we may not have identified, or may have underestimated, liabilities or obligations assumed in the merger, which could result in unexpected litigation, regulatory exposure, accounting charges, increased tax liabilities, or other adverse effects;
management’s attention may be diverted from other strategic or operational matters due to the integration process;
challenges in modifying, redesigning, or further developing IRRAflow technology for additional therapeutic applications, including longer duration infusions or oncology and drug delivery uses, which may require substantial engineering work, clinical evaluation, and additional regulatory clearances or approvals; and the risk that we may be unable to expand the indications for use of IRRAflow beyond its current FDA-cleared labeling due to technical, clinical, regulatory, or market constraints.
The occurrence of any of these factors, individually or in the aggregate, could materially and adversely affect our business, results of operations, financial condition, and the market price of our common stock.
Our future success depends in part on our ability to maintain these relationships and establish new relationships, and our drug delivery customer's continued use of our products and services in their therapeutic programs through their research, development, and commercialization process. Many factors have the potential to impact such collaborations, including theour abilitycustomer’s tosatisfaction deliver therapies towith our drugperformance deliveryof customers’services satisfaction,and our products, force majeure, regulatory approval, perceptions in connection with the safety of therapies or delivery mechanisms, our customers’ ability to access adequate and sustainable financing, our customers’ ability to achieve commercial success for their therapies, including overcoming barriers in reimbursement, physician adoption, and patient access to their therapies, and other factors that may be beyond our control. Furthermore, ourOur drug delivery customers may decide to decrease or discontinue their use of our products and services due to changes in research and product development plans, failures in their clinical trials, financial constraints, utilization of internal resources or services performed by other parties. Cancellation or renegotiation of a large agreement could adversely affect our business and, therefore, may adversely affect our operating results. In addition, we may also enter into agreements with customers for which we are paid a lump sum conditioned upon the achievement of development milestones. Accordingly, in these cases, we bear the risk if we underprice our contracts, overrun our cost estimates, or if there is a failure by us or our customer to achieve the development milestones. Any such events could have an adverse effect on our business, results of operations, financial condition and cash flows.
We engage in conversations with drug delivery customers regarding potential opportunities on an ongoing basis. There is no assurance that any of these conversations will result in an agreement, or if an agreement is reached, that the resulting relationship will be successful or that preclinical, clinical, or research studies conducted as part of the engagement will be continued or will produce successful commercial outcomes.
Our ClearPoint system and our IRRAflow system may not achieve broad market adoption.
To date, a substantial majority of the sales of our ClearPoint Systemsystem have been derived from a limited number of hospitals.hospitals, and the IRRAflow system has also historically been used by a relatively small group of neurocritical care centers. Our future growth depends on our ability to increase physician and patienthospital awareness of ourboth products,products and on the willingness of hospitals to adopt our productstechnologies for their neurosurgical and neurocritical care procedures. OurNeither the ClearPoint system nor the IRRAflow system may not gain broad market adoption unless we continue to convince physicians, hospitals and patients of its benefits. Moreover, even if physicians and hospitals understand the benefits of ourtheir ClearPointrespective system, they still may elect not to use our ClearPoint system for a variety of reasons, such as:benefits.
Moreover, even if physicians and hospitals understand the potential benefits of our systems, they may still elect not to use them for a variety of reasons, such as:
demand for the MRI suite within the hospital, which may result in limited or no MRI scanner availability for certain MRI-based procedures in which our ClearPoint system would be used;
the familiarity of the established physicianphysicians with other devicesdevices, anddrainage systems, or established surgical approaches;
lack of exposure to the ClearPoint system inor the IRRAflow system during residency or fellowship trainingtraining, period wherewhen preferences for surgical and critical care methods are formed;
the physician’s perceptionperceptions that there are insufficient clinical benefits of our ClearPointsystems system relativecompared to thosecompeting othertechnologies devicesor and surgicaltraditional approaches;
budgetary constraints with respect to the purchase or placement of our ClearPoint system hardware andor softwarethe IRRAflow control unit;
hospital infection control procedures;
the pricepricing of our ClearPoint system disposable products, which may be higher than devices used with other surgicalalternative approaches; and thephysician physician’s perceptionperceptions that there is a lack ofadditional clinical data onor thereal-world useevidence is needed to support broader adoption of our ClearPoint system.technologies.
Our ability to execute our growth strategy and become profitable depends uponon theincreased adoption byof physicians and hospitals ofboth the ClearPoint system forand usethe inIRRAflow neurosurgical procedures.system. Historically, a substantial portion of our revenue ishas been generated from sales of the disposable products utilizedused with ourthe ClearPoint system, and wethe IRRAflow system similarly relies on utilization driven sales of its disposable catheters and consumables. We are therefore highly dependent on growing the installed base ofand theprocedure ClearPoint systemvolumes for ourboth success.systems. We cannot provide assurance that our ClearPointeither system will achieve broad market acceptance among hospitals,hospitals physicians,and or patients.physicians. Any failure of the ClearPoint system or the IRRAflow system to achieve meaningful market acceptance and penetration willwould harm our future prospects and have a material adverse effect on our business, financial conditioncondition, and results of operations.
Our future business growth is dependent on our ability to market and sell both the ClearPoint system and the IRRAflow system, and on our ability to integrate and effectively manage a combined commercial team that must support two distinct product platforms; our limited experience selling the ClearPoint system in the operating room may further increase these challenges.
Historically, our commercial efforts have been focused on selling and supporting the ClearPoint system for neurosurgical procedures performed in the MRI suite. Although we recently expanded our ClearPoint navigation technology for use in the operating room through the launches of the SmartFrame Array Neuro Navigation System and Software, the SmartFrame OR Stereotactic System, and ClearPoint Navigation Software Version 3.0, we have relatively limited experience marketing and selling the ClearPoint system in the operating room environment, and our limited experience in this setting may make adoption more difficult, slower, or more costly than we anticipate.
Following our acquisition of IRRAS, our combined commercial organization is also responsible for promoting the IRRAflow system within neurocritical care units. Successfully commercializing both the ClearPoint system and the IRRAflow system requires coordinated and effective sales, marketing, and clinical support across two distinct clinical settings with different decision-makers, clinical priorities, and procurement pathways. The need to grow adoption of two systems in two different hospital environments amplifies the commercial complexity that we must now manage.
Integrating and managing the combined commercial organization presents additional risks, including:
aligning sales and clinical support teams that previously operated under different commercial strategies, product expertise, and customer bases;
training personnel to effectively promote both stereotactic navigation products and ICU-based fluid management technologies;
addressing differing decision makers, sales cycles, reimbursement dynamics, and capital and disposable purchasing processes in the operating room and in neurocritical care units;
retaining key sales and clinical specialists from both organizations and maintaining productivity during integration;
harmonizing systems and processes, including customer relationship management tools, forecasting, performance metrics, and compensation structures; and allocating sales and clinical resources efficiently across two markets with different competitive landscapes and adoption curves.
Our ability to achieve our business objectives depends on expanding the installed base and procedure volumes for both the ClearPoint system and the IRRAflow system. If we are unable to overcome the challenges associated with our limited operating room experience, or if we cannot integrate the combined commercial teams effectively to support both platforms, we may fail to achieve anticipated growth. Any such failure could have a material adverse effect on our business, financial condition, and results of operations.
A portion of our future business growth is dependent upon marketing and selling our ClearPoint system, and other new products, in the operating room, and if we are unable to expand, manage and maintain our marketing and sales capabilities in this environment, we may be unable to generate significant growth in our product revenues.
We started selling our ClearPoint system in 2010, and to date, sales of the ClearPoint system have been primarily focused on its use for neurosurgical procedures in the MRI suite. In 2021, we launched the SmartFrame Array Neuro Navigation System and Software, and in 2024, we commercialized the SmartFrame OR Stereotactic System. Both SmartFrame Array and SmartFrame OR allow for operating room placement of our technology. We have relatively limited experience marketing and selling our ClearPoint system and products for use with neurosurgical procedures in the operating room. If our team fails to adequately promote, market and sell the ClearPoint system, and other new products that we may develop in the future, in this new environment, our sales could suffer.
Additionally, our future revenue and operating results will depend on our ability to manage the anticipated growth of our business. To achieve our business objectives, we must continue to grow. However, continued growth presents numerous challenges, including:
expanding our sales, clinical support, product development and marketing infrastructure and capabilities;
expanding our assembly capacity and increasing production;
implementing appropriate operational and financial systems and controls;
improving our information systems;
identifying, attracting and retaining qualified personnel in our areas of activity; and hiring, training, managing and supervising our personnel.
We cannot be certain that our systems, controls, infrastructure and personnel will be adequate to support our future operations. Any failure to effectively manage our growth could impede our ability to successfully develop, market and sell our products and our business will be harmed.
Our long-term growth depends on our ability to compete effectively in the neurosurgery marketand neurocritical care markets by developing and commercializing new products and services through our research and development efforts, independently and through third-party collaborations.collaborations, including key development work required to support broader adoption of the IRRAflow system.
Our future business prospects depend in part on our ability to develop and commercialize new products and services, such as the Company’s proprietary robotic neuro-navigation system. Following our acquisition of IRRAS, our growth also depends on our ability to complete certain research and development initiatives related to the IRRAflow system, including enhancements to its workflow, expansion of its labelling, as well as potential design modifications or product improvements that may be necessary to expand clinical use or improve adoption in neurocritical care settings. If we are unable to complete these development efforts successfully, or if they take longer or cost more than anticipated, adoption of the IRRAflow system may be limited.
Our future business prospects depend in part on our ability to develop and commercialize new products and services, such as the Maestro Brain Model, the ClearPoint Prism Neuro Laser Therapy System, SmartFrame OR, and preclinical development and device development services for pharmaceutical partners. New technologies, techniques or products could emerge from competitors that might offer better combinations of price and performance than our products and services. It is important that we anticipate changes in technology and market demand, as well as customer preferences and practices, to successfully commercialize new technologies to meet our prospective customers’ needs on a timely and cost-effective basis.
We might be unable to successfully commercialize our marketed products or services or obtain authorization to market new products. The success of any new product offeringoffering, including enhancements or next generation versions of the IRRAflow system, will depend on numerous factors, including our ability to:
properly identify and anticipate customer needs across neurosurgery and neurocritical care;
develop and introduce new productsproducts, enhancements, or servicesmodifications in a timely manner;
obtain the necessary regulatory authorizations to market new productsproducts, including any enhancements or productexpanded enhancementsindications for the IRRAflow system;
If we do not develop and obtain regulatory authorization to market new products in time to meet market demand, or if there is insufficient demand for these products, including future versions or enhancements of the IRRAflow system, does not materialize as expected, our results of operations will suffer. Our internal research and development efforts and our outsourced third-party design and development initiatives may require a substantial investment of time and resources before we are adequately able tocan determine the commercial viability of a new product, technology, material or othermodification. innovation. In addition, evenEven if we are able to develop enhancements or new generations of our products successfully, these enhancements or new generations of productsthey may not produce sales inthat excess ofexceed the costs of developmentdevelopment, and they may be quickly rendered obsolete by changing customer preferences or the introduction by our competitors of productscompeting embodying new technologies or features.technologies.
Limitations in the existing clinical evidence for the IRRAflow system may affect clinical and commercial adoption.
The existing clinical literature regarding the IRRAflow system has significant limitations, and further clinical studies may be required to demonstrate safety and effectiveness of the device. If additional supportive data is not generated, clinical acceptance and broader commercial adoption of the IRRAflow system could be adversely affected.
Management's Discussion & Analysis (MD&A)
Largest changes
“the duration and impact of macroeconomic trends, including inflationary pressures, changes in monetary policy, decreasing consumer confidence and spending, the introduction of or changes in tariffs or trade barriers, global or local recession, and geopolitical instability; and the effect of competing technological and market developments.”see in full comparison
“the ultimate duration and impact of macroeconomic trends, including inflationary pressures, changes in monetary policy, decreasing consumer confidence and spending, the introduction of or changes in tariffs or trade barriers, global or local recession, and geopolitical instability;”see in full comparison
“As of December 31, 2025, we had $50.9 million notes payable to the 2025 Investor due in 2031. Future interest payments associated with the notes are variable based on (i) the greater of the Term SOFR (as defined in the 2025 NPA) and 4.30%; and (ii) 3.95%, with a minimum rate of 8.25% and a cap of 9.50%. At current interest rates, we expect the interest payments (not including paid-in-kind) for the next 12 months to be approximately $2.5 million. See Note 9 to the consolidated financial statements included elsewhere in this Annual Report.”see in full comparison
“Determining the fair value of assets acquired and liabilities assumed requires management to make significant estimates and assumptions used in estimating the fair value of acquired technology and other identifiable intangible assets. Although we believe that the assumptions and estimates we have made are reasonable and appropriate, they are inherently subjective. The assistance of an independent third-party valuation firm was used to determine the estimated fair values and useful lives of finite-lived intangible assets including developed technology, customer relationships, and trademarks. …”see in full comparison
“Business Combinations. The IRRAS acquisition has been accounted for under the acquisition method of accounting in accordance with ASC 805. Under the acquisition method of accounting, we record the assets acquired and liabilities assumed at their estimated fair values as of the acquisition date. The excess of the cost of the acquired business and the fair value of the assets acquired and liabilities assumed is recognized as goodwill. …”see in full comparison
“European Medical Device Regulation (EU MDR) certification for the SmartFlow Neuro Cannula; and Several expanded regulatory approvals for product use in Canada, Hong Kong, and Taiwan, bringing the total number of international clearances for key therapy delivery products to 34 countries worldwide.”see in full comparison
Full comparison: every changed paragraph (74)
We are a commercial-stage medical device company that develops and commercializes innovativeintegrated platformssystems forused performingin minimally invasive surgicalneurosurgical procedures in the brain. We have deployed significant resources to fund our efforts to develop the foundational capabilities for enabling MRI-guided interventions, building an intellectual property portfolio, and identifying and building out commercial applications for the technologies developed by our company. Over the past several years, we have expanded our capabilities beyond the MRI suite to include operating room based neurosurgical device products and a growing portfolio of services that support pharmaceutical and biotechnology partners developing gene and cell therapies. In 2025, with the acquisition of IRRAS, we expanded our portfolio into neurocritical care, focusing on treatments for intracerebral hemorrhage, intraventricular hemorrhage, and other conditions requiring intracranial fluid management.
Our business today consists of two integrated components: (i) a business providing medical devices for neurosurgical applications, and (ii) a business focused on partnerships in the biologics and drug delivery space.
The first foundational component of our business is a medical device company providing medical devices for neurosurgery applications. Our primary medical device product, the ClearPoint system, is an integrated system comprised of hardware components, disposable components, and intuitive, menu-driven software, which is in commercial use globally.software. The primary applications for the ClearPoint system are to target and guide: (a) the insertion of deep brain stimulation electrodes, biopsy needles, and laser catheters,catheters; asand well as(b) the infusion of pharmaceuticals into the brain. The ClearPoint system was originally designed for use in an MRI setting. In 2021, we launched the SmartFrame Array Neuro Navigation System and Software, which allows for operating room placement of the ClearPoint system,system and completion of the procedure in the MRI suite. In 2024, we launched limited market release ofintroduced the SmartFrame OR Stereotactic System,System to the market, which allows for complete procedures to be performed in the operating room. In 2022,2025, we commercializedreleased the ClearPoint PrismNavigation NeuroSoftware LaserVersion Therapy3.0, Systemwhich asallows our first therapy product offering. We have exclusive global commercialization rights tofor the ClearPoint Prismsystem Neuronavigation Lasersoftware Therapyto Systemsupport throughend-to-end ourprocedures Swedishin partner,the CLS.operating room.
In 2022, we commenced commercialization of the ClearPoint Prism Neuro Laser Therapy System, a laser ablation system. The ClearPoint Prism Neuro Laser Therapy System was developed and is manufactured for us by CLS. We have exclusive global rights to commercialize the system for neuro applications.
In 2025, through the acquisition of IRRAS, we added the IRRAflow system to our portfolio of medical devices. The IRRAflow system integrates continuous irrigation, drainage, and real-time intracranial pressure monitoring to provide controlled, automated intracranial fluid management within neurocritical care and operating room settings.
The second component of our business is focused on partnerships in the biologics drug and delivery space, supporting our customers from the earliest stages of their research through their clinical study and commercialization process. Since 2021, a growing and significant part of the revenue from our business has been derived from preclinical development services, which include protocol consultation and solutions for preclinical study design and execution. Our consulting services include a core competency of in vivo biology services in large and small research models to assist our customers with establishing drug safety prior to and in support of their human clinical trials.
The second component of our business is focused on partnerships in the biologics drug and delivery space. Our services include protocol consultation and solutions for preclinical study design and execution. Currently, we have more than 60 biologics and drug delivery customers who are evaluating using our products and services in trials to inject gene and cell therapies directly into the brain. These partnerships involve drug development programs that are at various stages of development ranging from preclinical research to late-stage regulatory trials for multiple distinct disease states. This part of our business potentially represents the largest opportunity for growth; however, our ability to grow in this market is dependent on our ability to maintain and establish new relationships with pharmaceutical company customers, such customers' continuation of research and product development plans, and such customers achieving success in completion of clinical trials and subsequent regulatory approvals of their drugs and biologics.biologics, and such customers’ realization of commercial success for their therapies, including overcoming barriers in reimbursement, physician adoption, and patient access to their therapies. In 2024, the U.S. Food and Drug Administration (the “FDA”) granted marketing authorization for our SmartFlow cannula to be used to deliver a gene therapy for the treatment of aromatic L-amino acid decarboxylase deficiency to regions of interest within the brain.
20242025 Milestones and Developments
Completed the acquisition of IRRAS, which brings the IRRAflow active fluid-exchange system into our product portfolio, a differentiated technology designed to modernize the management of intracranial bleeding.
Entered into a debt financing arrangement with an affiliate of Oberland Capital Management under which we may borrow up to $105.0 million from time to time in tranches; we raised approximately $48.1 million in net proceeds under this arrangement during 2025.
Raised approximately $3.3 million in net proceeds from the sale of shares of our common stock to an affiliate of Oberland Capital Management.
Entered into a lease for the new preclinical research facility named ClearPoint Advanced Laboratories (CAL) located in San Diego, California, allowing for additional capacity to perform larger studies, and the ability to offer additional services to biopharma partners.
Activated 25 new global centers for the year, reflecting an increase in demand driven by new product offerings, including the PRISM Laser Therapy System and SmartFrame OR.
Completed a follow-on public offering of common stock, resulting in net proceeds of approximately $16.2 million, and entered into an At-the-Market (“ATM”) Equity Offering Sales Agreement (the "ATM Agreement") pursuant to which we may offer and sell, from time to time, shares of our common stock, having aggregate sales proceeds of up to $50 million.
Repaid prior to maturity all remaining principal and interest on secured convertible notes issued in 2020, resulting in no outstanding debt at December 31, 2024.
Reduced cash used in operating activities to $9.0 million in 2024, a 35% year-over-year decrease.
Several of our partners advanced through preclinical and clinical review, with sevenover ten pharmaceutical partners receiving expedited US FDA review designations.
FDA Clearance for the ClearPoint 3.0 Software which includes both operating room navigation capability and features enhanced for laser therapy applications;
FDA 510(k) clearance expanding compatibility of the ClearPoint PRISM Neuro Laser Therapy System with 1.5T scanners in addition to the previously cleared 3T compatible system;
European Medical Device Regulation (EU MDR) certification for the SmartFlow Neuro Cannula; and Several expanded regulatory approvals for product use in Canada, Hong Kong, and Taiwan, bringing the total number of international clearances for key therapy delivery products to 34 countries worldwide.
o
US FDA 510(k) clearance for SmartFrame OR Stereotactic System to support expansion into the operating room;
o
Taiwan Food and Drug Administration approval of SmartFlow cannula for commercial use in Taiwan; and o US FDA De Novo marketing authorization of the SmartFlow Neuro Cannula for intraputaminal administration of eladocagene exuparvovec-tneq for the treatment of adult and pediatric patients with AADC deficiency, representing the first-ever FDA marketing authorization of a device used to deliver gene therapy directly to regions of interest in the brain.
In 2010, we received 510(k) clearance from the FDA to market our ClearPoint system in the U.S. for general neurosurgical procedures; in February 2011 and May 2018, we also obtained CE marking for our ClearPoint system and SmartFlow Neuro cannula, respectively; and in June 2020 we obtained CE marking for version 2.0 of our ClearPoint software and our Inflexion head fixation frame. In January 2021, we received 510(k) clearance for the SmartFrame Array Neuro Navigation System. In September 2022, the ClearPoint Prism Neuro Laser Therapy System, for which we have exclusive global rightrights to commercialize, received 510(k) clearance through our Swedish partner, CLS. The Prism laser representsis the first therapy product we have commercialized. In January 2024, we received 510(k) clearance from the FDA for the SmartFrame OR Stereotactic System.
Future revenue from sales of our ClearPoint platform products and services is difficult to predict and may not be sufficient to offset our continuing research and development expenses and our increasing selling, general and administrative expenses. As a result of the IRRAS acquisition, revenue is expected to grow over the coming years due to a larger combined organization, expanded product offerings, and increased customer reach, both in the U.S. and internationally.
Underlying the revenue from sales of products and services to our biologics and drug delivery customers is the number of direct customers and end users of our products and/or services (“Partners”). Our Partners consist of pharmaceutical and biotech companies, academic institutions, or customer-sponsored contract research organizations that are developing methods to deliver a wide variety of molecules, genes or proteins to targeted brain tissue or structures that would need to bypass the blood-brain barrier for the treatment of a variety of disorders. This is a novel area in which commercialization must be preceded by FDA-mandated clinical trials, which are expensive and time consuming to conduct, and for which commercial success is uncertain, pending, in part, on the outcome of those trials. While our revenue from sales of products and services to our biologics and drug delivery customers is indicative of growth, the number of Partner relationships is also of importance as we recognize the possibility that some Partners’ research will reach commercial success, and others may not. To the extent our Partners achieve commercial success, our expectation is that we will share in such success through our Partners’ use of our products and services in their delivery of therapies. At December 31, 2024,2025, we had more than 60 Partners, as comparedsimilar to overthe 50number of Partners as of the same date in 2023.2024.
Cost of revenue includes the direct costs associated with the assembly and purchase of components for neurosurgery navigation products, biologics and drug delivery products, non-neurosurgery therapy products, and ClearPoint capital equipment that we have sold, and for which we have recognized revenue in accordance with our revenue recognition policy, as well as labor hours for the cost of providing preclinical, consulting, and service revenue. Cost of revenue also includes the allocation of manufacturing overhead costs and depreciation of loaned systems installed under our ClearPoint placement program, as well as provisions for obsolete, impaired, or excess inventory. The IRRAS acquisition is expected to impact cost of revenue and reduce overall gross margins in the near term as IRRAflow currently operates at sub-scale production levels, resulting in higher per-unit manufacturing costs compared to the existing product portfolio.
Our research and development costs consist primarily of costs associated with the conceptualization, design, testing, and prototyping of our ClearPoint system products, cannulas, and enhancements. Such costs include salaries, travel, and benefits for research and development personnel; materials and laboratory supplies in research and development activities; outside consultant costs; and licensing costs related to technology not yet commercialized. We anticipate that, over time, our research and development costs may increase as we: (i) develop devices and services for delivery of therapeutics into the central nervous system, (ii) expand products into the OR and therapeutics space, and (iii) expand the application of our technological platforms internationally.internationally, and (iv) invest in the IRRAflow product portfolio and clinical evidence.
Our sales and marketing, and general and administrative expenses consist primarily of salaries, incentive-based compensation, travel and benefits, including related share-based compensation; marketing costs; professional fees, including fees for outside attorneys and accountants; occupancy costs; insurance; and other general and administrative expenses, which include, but are not limited to, corporate licenses, director fees, hiring costs, taxes, postage, office supplies, information technology and meeting costs. We expect increases in our sales and marketing expenses as a result of the larger combined sales organization, primarily reflecting higher salary and personnel-related costs associated with the larger commercial team following the IRRAS acquisition.
Business Combinations. The IRRAS acquisition has been accounted for under the acquisition method of accounting in accordance with ASC 805. Under the acquisition method of accounting, we record the assets acquired and liabilities assumed at their estimated fair values as of the acquisition date. The excess of the cost of the acquired business and the fair value of the assets acquired and liabilities assumed is recognized as goodwill. During the measurement period, which is up to one year from the acquisition date, we may adjust provisional amounts that were recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date. See Note 3 to our consolidated financial statements included elsewhere in this Annual Report for additional information regarding the IRRAS acquisition.
Determining the fair value of assets acquired and liabilities assumed requires management to make significant estimates and assumptions used in estimating the fair value of acquired technology and other identifiable intangible assets. Although we believe that the assumptions and estimates we have made are reasonable and appropriate, they are inherently subjective. The assistance of an independent third-party valuation firm was used to determine the estimated fair values and useful lives of finite-lived intangible assets including developed technology, customer relationships, and trademarks. Valuation methods were based on the income-based approaches including the multi-period excess earnings method, distributor method, and relief-from-royalty method for developed technology, customer relationships, and trademarks, respectively. Critical estimates and assumptions used in valuing acquired intangible assets include the timing and amount of forecasted revenue, expenses, and cash flows, the life cycle of each asset, the potential regulatory and commercial success risk, competitive trends impacting the assets, and the discount rate reflecting the risk inherent in future cash flows. If the subsequent actual results and updated projections change compared with the assumptions and projections used to develop these values, we could record impairment charges. In addition, we have estimated the economic lives of certain acquired assets and these lives are used to calculate amortization expense. If our estimates of the economic lives change, amortization expenses could be accelerated or slowed.
Inventory. Inventory is carried at the lower of cost (first-in, first-out method) or net realizable value. Items in inventory relate predominantly to our neurosurgical products, drug delivery and biologic products, therapy products and ClearPoint capital equipment. Software license inventory related to ClearPoint systems undergoing on-site customer evaluation is included in inventory in the accompanying consolidated balance sheets. All other software license inventory is classified as a non-current asset. We periodically review our inventory for excess and obsolete items and provide a reserve upon giving consideration to factors such as its physical condition, sales patterns, and expected future demand in order to estimate the amount necessary to write down any slow moving, obsolete, or damaged inventory. These estimates could vary from actual amounts based upon future economic conditions, customer inventory levels, or competitive factors that were not foreseen or did not exist when the estimated write-downs were made.
Share-Based Compensation. We account for compensation for all arrangements under which employees and others receive shares of stock or other equity instruments (such as restricted stock and options) based on fair value. The fair value of each award is estimated as of the grant date and amortized as compensation expense over the requisite vesting period. In the case of stock options, the fair value is estimated on the grant dates using the Black-Scholes valuation model. This valuation model requires the input of highly subjective assumptions, including the expected stock volatility, estimated award terms and risk-free interest rates for the expected terms. To estimate the expected terms, we utilize the simplified method for “plain vanilla” options discussed in the SEC’s Staff Accounting Bulletin 107, or SAB 107. We believe that all factors listed within SAB 107 as prerequisites for utilizing the simplified method apply to us and to our share-based compensation arrangements. We intend to utilize the simplified method for the foreseeable future until more detailed information about exercise behavior becomes available. Expected volatility is based on historical volatility of our common stock. We utilize risk-free interest rates based on U.S. treasury instruments, the term of which is consistent with the expected term of the share-based award. We have not paid, and do not anticipate paying, cash dividends on shares of our common stock; therefore, the expected dividend yield is assumed to be zero. We do not believe there is a reasonable likelihood that there will be a material change in estimates or assumptions used to determine share-based compensation expense.
Biologics and drug delivery revenue, which include sales of disposable products and services related to customer-sponsored preclinical and clinical trials utilizing our products, increased 27%10% to $19.0 million for the year ended December 31, 2025, from $17.3 million for the year ended December 31, 2024, from $13.6 million for the same period in 2023.2024. This increase is attributable to a $3.5$1.7 million increaseof inhigher product revenue resulting from highergreater demand for disposables as multiple partners progress in their trials, and a $0.3 million increase in service and other revenue related to new preclinical trials and service agreements entered into with our partners for the year ended December 31, 2024, compared to the same period in 2023.trials.
Neurosurgery navigation and therapy revenue, which primarily consists of disposable product commercial sales related to cases utilizing the ClearPoint system, increased 21%44% to $10.3$14.8 million during the year ended December 31, 2024,2025, from $8.5$10.3 million for the sameyear periodended inDecember 2023.31, Product2024. revenueThe increase is driven by an increased $2.7customer million,base, oradditional 36%,revenues resultingdue fromto newlysales activatedof accounts,the increasedIRRAflow case count,product, and higher sales for new productofferings offerings, includingof SmartFrame OR andOR, Prism Laser Therapy, and introduction of our 3.0 operating room software, during the year ended December 31, 2025, compared to the sameyear periodended inDecember 2023.31, This was partially offset by a decrease in service and other revenue of $0.9 million primarily as a result of pausing a co-development program with one of our Brain Computer Interface partners.2024.
Capital equipment and software revenue, consisting of sales of ClearPoint reusable hardware and software and related services, increaseddecreased 107%18% to $3.1 million for the year ended December 31, 2025, from $3.8 million for the year ended December 31, 2024, from $1.8 million for the same period in 2023, due to ana increasedecrease in the placements of ClearPoint navigation capital equipment and software and Prism laser units.
Cost of Revenue and Gross Profit. Cost of revenue was $14.3 million, resulting in gross profit of $22.7 million for the year ended December 31, 2025, compared to $12.3 million, resulting in gross profit of $19.1 million for the year ended December 31, 2024. Gross margin was 61% for both the years ended December 31, 2025 and December 31, 2024.
Cost of Revenue and Gross Profit. Cost of revenue was $12.3 million, resulting in gross profit of $19.1 million and gross margin of 61%, for the year ended December 31, 2024, compared to $10.3 million, resulting in gross profit of $13.6 million and gross margin of 57% for the year ended December 31, 2023. The increase in gross margin was primarily due to lower costs for the year ended December 31, 2024 due to the transition to the new manufacturing facility, occurring in 2023, and higher volumes for the year ended December 31, 2024.
Research and Development Costs. Research and development costs were $13.9 million for the year ended December 31, 2025, compared to $12.4 million for the year ended December 31, 2024, compared to $11.7 million for the same period in 2023, an increase of $0.7$1.5 million, or 6%.12%. The increase was due primarily to increaseshigher product and software development costs of $1.2 million, an increase in personnel costs, including share-based compensation expense, of $1.2$0.2 millionmillion, and additional costs due to growththe in headcount, partially offset by a decreaseacquisition of $0.5 million in research costs as a result of reprioritization of certain initiatives.IRRAS.
Sales and Marketing Expenses. Sales and marketing expenses were $16.5 million for the year ended December 31, 2025, compared to $14.5 million for the year ended December 31, 2024, compared to $12.6 million for the same period in 2023, an increase of $1.9$2.0 million, or 15%.14%. This increase was primarily due to higher personnel costs, including share-based compensation expense, of $1.6$1.4 million resulting from increases in headcount in our clinical team, increasesas inwell travelas expenseincreased costs of $0.4$0.9 million,million due to the acquisition of IRRAS, partially offset by $0.1decreased marketing costs of $0.2 million inand otherdecreased marketingtravel activities.costs of $0.2 million.
General and Administrative Expenses. General and administrative expenses were $16.5 million for the year ended December 31, 2025, compared to $12.0 million for the year ended December 31, 2024, compared to $11.8 million for the same period in 2023, an increase of $0.2$4.5 million, or 2%.38%. This increase was due primarily to severance expense of $1.4 million in connection with the IRRAS acquisition, increased professional service fees of $1.0 million, higher personnel costs, including share-based compensationcompensation, of $1.2$0.9 million, anhigher increaseinformation in renttechnology and occupancysoftware costs as a result of the new Carlsbad site of $0.5 million, partiallyincreased offsetbad bydebt aexpense decreaseof in$0.2 million, and additional costs of $0.2 million related to the allowanceIRRAS for credit losses of $1.5 million mainly as a result of subsequent recoveries.acquisition.
Interest IncomeIncome. (Expense). Net interestInterest income for the year ended December 31, 20242025 was $0.9$1.2 million, compared with $0.4$1.4 million for the sameyear periodended December 31, 2024. The decrease in 2023,interest asincome ais resultprimarily ofdue increasedto decreased investment in U.S. Government debt securities stemming from the capital raise in March 2024 as well as lower interest expense due to lower cash balances in the earlyfirst repaymenthalf of the First Closing Note.2025.
Interest Expense. Interest expense for the year ended December 31, 2025 was $2.4 million compared with $0.5 million for the year ended December 31, 2024. The increase was due to the issuance of notes payable in May and November 2025. See Note 9 to the consolidated financial statements included elsewhere in this Annual Report for more information regarding the notes payable issued in May and November 2025.
In May 2025, we entered into a Stock Purchase Agreement (the “2025 SPA”) with TPC Investments III LP, an affiliate of Oberland Capital Management LLC (the “2025 Investor”) relating to the purchase and sale in a registered direct offering of an aggregate of 275,808 shares of our common stock at a price of $12.69 per share, based on the trailing 30-trading day volume-weighted average price of our common stock. The aggregate net proceeds to us from the offering totaled approximately $3.3 million, after deducting offering expenses payable by us. See Note 11 to our consolidated financial statements included elsewhere in this Annual Report for more information regarding the 2025 SPA.
Contemporaneously with entering into the 2025 SPA, we entered into a note purchase agreement (the “2025 NPA”) with the 2025 Investor and CALW SA, LLC, as purchaser agent, under which we may sell to the 2025 Investor tranches of notes (“Notes”) in an aggregate principal amount of up to $105.0 million. Under the terms of the 2025 NPA, (a) we sold a Note in the principal amount of $30.0 million (the “First Purchase Note”) to the 2025 Investor upon signing of the 2025 NPA, (b) at our option, we may sell an additional $25.0 million in principal amount of Notes, in up to two increments of $12.5 million each, at any time prior to December 31, 2026, and (c) at our and 2025 Investor's option, we may sell up to $50.0 million in principal amount of Notes, at any time prior to December 31, 2026 (the “Third Tranche of Notes”).
In connection with the signing of the merger agreement pursuant which we acquired IRRAS, we and the 2025 Investor entered into an amendment to the 2025 NPA pursuant to which the 2025 Investor agreed to purchase $20.0 million in principal amount of the Third Tranche of Notes under the 2025 NPA following the closing of the IRRAS acquisition (the “Third Tranche Note”). The Third Tranche Note was sold to the 2025 Investor in November 2025.
The net proceeds from the sale of the First Purchase Note, after deducting the debt discount and debt issuance costs of $0.6 million and $0.7 million, respectively, was approximately $28.7 million. The net proceeds from the sale of the Third Tranche Note, after deducting the debt discount and debt issuance costs, was approximately $19.4 million. See Note 9 to our consolidated financial statements included elsewhere in this Annual Report for more information regarding the 2025 NPA.
In March 2024, we completed a public offering of 2,653,848 shares of our common stock from which thefor net proceeds totaledof approximately $16.2 million after deducting our payment of underwriting discounts and commissions and other offering expenses. InSee NovemberNote 2024, we entered into an ATM Agreement pursuant11 to which we may offer and sell, from time to time, shares of our commonconsolidated stock,financial havingstatements aggregateincluded saleselsewhere proceedsin ofthis upAnnual toReport $50for million,more subject to the terms and conditions of the ATM Agreement. As of December 31, 2024, we did not issue any shares of common stock under the ATM Agreement.information.
In November 2024, we established an at-the-market equity offering program under which we may offer and sell, from time to time, shares of our common stock having aggregate sales proceeds of up to $50 million. As of December 31, 2025, we did not sell any shares of common stock under our at-the-market equity offering program. See Note 11 to our consolidated financial statements included elsewhere in this Annual Report for more information regarding our at-the-market equity offering program.
In August 2024, we repaid in full the remaining $10 million outstanding under the secured convertible notes issued in 2020 to two investors raising gross proceeds of $25 million, of which $15 million had been previously converted to common stock.
Additional information with respect to the public offerings and 2020 secured convertible notes is in Note 9 and 7, respectively, to the consolidated financial statements included elsewhere in this Annual Report.
As a result of these transactions and our business operations, our cash and cash equivalents totaled $20.1$45.9 million at December 31, 2024.2025. In management’s opinion, based on our current forecasts for revenue, expense and cash flows,forecasts, our existing cash and cash equivalent balances at December 31, 2024,2025 are sufficient to support our operations and meet our obligations for at least the next twelve months.months from the date of issuance of the financial statements included elsewhere in this Annual Report.
We may offer and sell additional equity or issue additional notes payable to raise funds for working capital, capital expenditures, or other general corporate purposes. Our primary uses of cash and operating expenses relate to paying employees and consultants, marketing our products, and supporting our research and development of future product offerings. Our short- and long-term liquidity requirements include the following obligations:
We have lease arrangements related to our office and manufacturing facilities under non-cancellable operating leases. See Note 8 to the consolidated financial statements included elsewhere in this Annual Report.
We typically enter into short-term agreements with vendors and suppliers of goods and services in the normal course of business through purchase orders, which are settled in cash upon our receipt of such goods or services. We may also at times enter into long-term commitments or license and collaboration agreements which require commitments that are noncancellable. The total amount as of December 31, 2024 for unfulfilled purchase orders and long-term purchase commitments is $5.4 million, of which approximately 28% is expected to be paid in 2025.
Net Cash Flows Used in Operating Activities. Net cash flows used in operating activities for the year ended December 31, 2025 was $23.9 million, an increase of $15.0 million from the year ended December 31, 2024. This increase was primarily due to a higher net loss of $6.6 million, and the paydown of accounts payable and accrued expenses of $10.6 million, the majority of which were liabilities assumed from the IRRAS acquisition. We do not expect to incur cash outflows for the payment of assumed liabilities of a similar magnitude in future periods, as the paydown of the liabilities assumed in connection with the IRRAS acquisition represents a non-recurring event.
Net Cash Flows from Operating Activities. Net cash flows used in operating activities for the year ended December 31, 2024 were $9.0 million, a decrease of $4.8 million from the year ended December 31, 2023. This decrease was due to a lower net loss of $3.2 million, and a net decrease in operating assets and liabilities of $1.8 million, partially offset by a net decrease in non-cash items of $0.2 million. The change in operating assets and liabilities is primarily due to higher accounts payable and accrued liabilities, partially offset by lower deferred revenue. The change in the non-cash items results primarily from recoveries in the allowance for credit losses, partially offset by higher share-based compensation expense.
Net Cash Flows fromProvided by (Used in) Investing Activities. Net cash flows provided by investing activities in 20242025 were $0.3$0.6 million and related to cash acquired from the IRRAS acquisition, partially offset by equipment acquisitions.
Net cash flows used in investing activities in 2024 were $0.3 million and related to equipment acquisitions.
What changed in the latest 10-Q
Risk Factors
New heading “Establishing and operating our preclinical CRO facility (CAL) is capital intensive and subject to significant execution risk, and we may not realize the anticipated benefits of this investment.”
Largest changes
“Establishing and operating our preclinical CRO facility (CAL) is capital intensive and subject to significant execution risk, and we may not realize the anticipated benefits of this investment.”see in full comparison
“We are investing significant capital and management resources to build out, equip, and operate our preclinical contract research organization facility (CAL) to provide preclinical services, including Good Laboratory Practice (GLP) study services, to biopharmaceutical customers. …”see in full comparison
“The build-out and commissioning of the facility are subject to risks that could delay or increase the cost of making it operational, including construction and permitting delays, cost overruns, supply chain constraints or delays in the delivery, installation, and qualification of capital equipment, contractor or vendor performance issues, and other factors, some of which are beyond our control. Delays in taking possession of, building out, remediating, or commissioning the facility could postpone the date on which we are able to begin performing services and generating associated revenue.”see in full comparison
“As a result of these factors, the revenue generated by the facility may be insufficient to offset the significant fixed and variable costs of building, equipping, and operating it, and we may not achieve a return on this investment that justifies the capital and resources deployed, or may not do so within the timeframe we expect. The investment required to establish and expand the facility may also divert capital and management attention from our other business operations. …”see in full comparison
“Even if the facility becomes operational, we may be unable to attract sufficient customer demand, execute or retain a sufficient volume of statements of work, or scale our capacity and throughput to the levels necessary to utilize the facility efficiently. Customer statements of work may be delayed, rescheduled, reduced in scope, or terminated, and demand for our preclinical services may not materialize at the levels or on the timeline we expect. …”see in full comparison
“Our ability to perform certain services, including GLP-compliant studies, depends on achieving and maintaining the appropriate regulatory and quality standards for the facility and its processes. We may be unable to establish, validate, or maintain GLP compliance or other required standards on the timeline we anticipate or at all, which could prevent us from performing GLP studies. …”see in full comparison
Full comparison: every changed paragraph (7)
An investment in shares of our common stock involves a high degree of risk. You should carefully consider the risks and uncertainties described in our 2025 10-K, in addition to other information in this report, before investing in our common stock. The occurrence of any of these risks could have a material adverse effect on our business, financial condition, results of operations and growth prospects. In these circumstances, the market price of our common stock could decline, and you may lose all or part of your investment. There have been no material changes to the risk factors disclosed under Part I, Item 1A. "Risk Factors" in our 2025 10-K.10-K, other than the risks discussed below:
Establishing and operating our preclinical CRO facility (CAL) is capital intensive and subject to significant execution risk, and we may not realize the anticipated benefits of this investment.
We are investing significant capital and management resources to build out, equip, and operate our preclinical contract research organization facility (CAL) to provide preclinical services, including Good Laboratory Practice (GLP) study services, to biopharmaceutical customers. Standing up and scaling this facility is capital intensive and requires substantial expenditures, including facility rent and related occupancy costs, leasehold improvements and construction, the purchase and installation of specialized capital equipment, and the hiring, training, and retention of qualified scientific and technical personnel. Many of these costs are fixed or must be incurred in advance of, and without assurance of, corresponding revenue.
The build-out and commissioning of the facility are subject to risks that could delay or increase the cost of making it operational, including construction and permitting delays, cost overruns, supply chain constraints or delays in the delivery, installation, and qualification of capital equipment, contractor or vendor performance issues, and other factors, some of which are beyond our control. Delays in taking possession of, building out, remediating, or commissioning the facility could postpone the date on which we are able to begin performing services and generating associated revenue.
Our ability to perform certain services, including GLP-compliant studies, depends on achieving and maintaining the appropriate regulatory and quality standards for the facility and its processes. We may be unable to establish, validate, or maintain GLP compliance or other required standards on the timeline we anticipate or at all, which could prevent us from performing GLP studies. Any failure or delay in achieving or maintaining these standards, or any finding of noncompliance, could result in lost or delayed revenue, reputational harm, loss of customers, or the need for additional expenditures to remediate.
Even if the facility becomes operational, we may be unable to attract sufficient customer demand, execute or retain a sufficient volume of statements of work, or scale our capacity and throughput to the levels necessary to utilize the facility efficiently. Customer statements of work may be delayed, rescheduled, reduced in scope, or terminated, and demand for our preclinical services may not materialize at the levels or on the timeline we expect. Our ability to expand capacity depends on factors including facility readiness, equipment availability, and our ability to recruit and retain qualified personnel, and we may be unable to scale on the timeline we anticipate or at all.
As a result of these factors, the revenue generated by the facility may be insufficient to offset the significant fixed and variable costs of building, equipping, and operating it, and we may not achieve a return on this investment that justifies the capital and resources deployed, or may not do so within the timeframe we expect. The investment required to establish and expand the facility may also divert capital and management attention from our other business operations. If we are unable to make the facility operational, achieve and maintain required compliance standards, generate sufficient demand, or scale efficiently, our business, financial condition, and results of operations could be materially and adversely affected.
Management's Discussion & Analysis (MD&A)
New heading “Six Months Ended June 30, 2026, Compared to the Six Months Ended June 30, 2025”
Largest changes
“Six Months Ended June 30, 2026, Compared to the Six Months Ended June 30, 2025”see in full comparison
We continue to monitor the impacts of various macroeconomic trends, such as inflationary pressure, changes in monetary policy,see in full comparisondecreasingconstraintsconsumeronconfidencehospitalandcapital spending, the introduction of or changes in tariffs or trade barriers, and global or localrecession.recession and geopolitical instability. Such changes in domestic and global macroeconomic conditions may lead to increased costs for our business. Additionally, these macroeconomic trends could adversely affect our customers, which could impact their willingness to spend on our products and services, or their ability to make payments, which could harm our collection of accounts receivable and financial results. In particular, a portion of our revenue is derived from products and services supporting pharmaceutical and biotechnology partners' preclinical and clinical development programs, and constraints in the funding environment for these partners, whether due to capital markets conditions or changes in government research funding, could cause partners to delay, scale back or discontinue programs utilizing our products and services. The world’s financial markets remain susceptible to significant stresses, resulting in reductions in available credit and government spending, economic downturn or stagnation, foreign currency fluctuations and volatility in the valuations of securities generally. As a result, our ability to access capital markets and other funding sources may not be available in the future on commercially reasonable terms, if at all.TheWerapidcannotdevelopmentpredictandwithfluidity of these situations precludes any prediction as tocertainty the ultimate impacttheyofwillthesehavetrends on our business, financial condition, results ofoperationoperationsandor cash flows, which will dependlargelyon future developments. To date, these trends have not had a material adverse impact on our business, financial condition or results of operations.
“the cost and timing of completing the build-out of, and achieving operational readiness at, our ClearPoint Advanced Laboratories facility, including the purchase and installation of related equipment;”see in full comparison
“Our biologics and drug delivery revenue comes from sales of products, including disposable products, and services related to customer-sponsored preclinical and clinical trials utilizing our products. Our biologics and drug delivery customers are pharmaceutical and biotech companies, academic institutions, and customer-sponsored contract research organizations that are developing methods to deliver a wide variety of molecules, genes or proteins to targeted brain tissue or structures (our “Partners”) that would need to bypass the blood-brain barrier for the treatment of a variety of disorders. …”see in full comparison
“Our revenue from sales of products and services to our biologics and drug delivery customers comes from pharmaceutical and biotech companies, academic institutions, or customer-sponsored contract research organizations that are developing methods to deliver a wide variety of molecules, genes or proteins to targeted brain tissue or structures (our “Partners”) that would need to bypass the blood-brain barrier for the treatment of a variety of disorders. …”see in full comparison
“Neurosurgery navigation and therapy revenue increased 71% to $11.4 million for the six months ended June 30, 2026, from $6.7 million for the same period in 2025. The increase is driven primarily by additional revenues due to sales of the IRRAflow product as well as the introduction of our 3.0 operating room navigation software, which has positively impacted procedural volumes in the operating room during the six months ended June 30, 2026, compared to the same period in 2025. We acquired the IRRAflow product in connection with our acquisition of IRRAS in the fourth quarter of 2025.”see in full comparison
Full comparison: every changed paragraph (50)
Currently, we have more than 60 biologics and drug delivery customers who are evaluating using our products and services in trials to inject gene and cell therapies directly into the brain. These partnershipscustomers involvehave drug development programs that are at various stages of developmentdevelopment, ranging from preclinical research to late-stage regulatory trials for multiple distinct disease states. This part of our business potentially represents the largest opportunity for growth; however, our ability to grow in this market is dependent on our ability to maintain and establish new relationships with pharmaceutical company customers, such customers' continuation of research and product development plans, such customers achievingsuccessfully success in completion ofcompleting clinical trials and subsequentobtaining regulatory approvals of their drugs and biologics, and such customers’ realization of commercial success for their therapies, including overcoming barriers in reimbursement, physician adoption, and patient access to their therapies. In 2024, the U.S. Food and Drug Administration (the “FDA”) granted marketing authorization for our SmartFlow cannula to be used to deliver a gene therapy for the treatment of aromatic L-amino acid decarboxylase deficiency to regions of interest within the brain.
We continue to monitor the impacts of various macroeconomic trends, such as inflationary pressure, changes in monetary policy, decreasingconstraints consumeron confidencehospital andcapital spending, the introduction of or changes in tariffs or trade barriers, and global or local recession.recession and geopolitical instability. Such changes in domestic and global macroeconomic conditions may lead to increased costs for our business. Additionally, these macroeconomic trends could adversely affect our customers, which could impact their willingness to spend on our products and services, or their ability to make payments, which could harm our collection of accounts receivable and financial results. In particular, a portion of our revenue is derived from products and services supporting pharmaceutical and biotechnology partners' preclinical and clinical development programs, and constraints in the funding environment for these partners, whether due to capital markets conditions or changes in government research funding, could cause partners to delay, scale back or discontinue programs utilizing our products and services. The world’s financial markets remain susceptible to significant stresses, resulting in reductions in available credit and government spending, economic downturn or stagnation, foreign currency fluctuations and volatility in the valuations of securities generally. As a result, our ability to access capital markets and other funding sources may not be available in the future on commercially reasonable terms, if at all. TheWe rapidcannot developmentpredict andwith fluidity of these situations precludes any prediction as tocertainty the ultimate impact theyof willthese havetrends on our business, financial condition, results of operationoperations andor cash flows, which will depend largely on future developments. To date, these trends have not had a material adverse impact on our business, financial condition or results of operations.
Our neurosurgery navigation and therapy revenue primarily consists of disposable product commercial sales related to cases utilizing the ClearPoint and IRRAflow systems. Generating recurring revenue from the sale of disposable products is an important part of our business model for our ClearPoint system.model. Future revenue from sales of our ClearPoint platformsuch products and services is difficult to predict and may not be sufficient to offset our continuing research and development expenses and our increasing selling, general and administrative expenses. As a result of the IRRAS acquisition, revenue is expected to grow over the coming years due to a larger combined organization, expanded product offerings, and increased customer reach, both in the U.S. and internationally.
Our biologics and drug delivery revenue comes from sales of products, including disposable products, and services related to customer-sponsored preclinical and clinical trials utilizing our products. Our biologics and drug delivery customers are pharmaceutical and biotech companies, academic institutions, and customer-sponsored contract research organizations that are developing methods to deliver a wide variety of molecules, genes or proteins to targeted brain tissue or structures (our “Partners”) that would need to bypass the blood-brain barrier for the treatment of a variety of disorders. This is a novel area in which commercialization must be preceded by FDA-mandated clinical trials, which are expensive and time consuming to conduct, and for which the commercial success is uncertain, pending, in part, on the outcome of those trials. The number of Partner relationships is of importance as we recognize the possibility that some Partners’ research will reach commercial success, and others may not. To the extent our Partners achieve commercial success, our expectation is that we will share in such success through our Partners’ use of our products and services in their delivery of therapies. At June 30, 2026, we had more than 60 Partners, similar to the number of Partners as of the same date in 2025.
Our capital equipment and software revenue consists of sales of ClearPoint and IRRAflow reusable hardware and software and related services.
As a result of the IRRAS acquisition, revenue is expected to grow over the coming years due to a larger combined organization, expanded product offerings, and increased customer reach, both in the U.S. and internationally.
Substantially all our revenue for the three and six months ended MarchJune 31,30, 2026 and 2025 relates to: (i) sales of our ClearPoint and IRRAflow system products and related services; and (ii) consulting services fromprovided to our customers in the biologics and drug delivery space.customers. Our product revenue was $8.8$7.4 million and $16.2 million for the three and six months ended MarchJune 31,30, 2026, respectively, and was almost entirely related to our ClearPoint system. Our service revenue was $3.3$3.5 million and $6.8 million for the three and six months ended MarchJune 31,30, 2026, respectively, of which 88% was related to the biologics and drug delivery service line.
Our revenue from sales of products and services to our biologics and drug delivery customers comes from pharmaceutical and biotech companies, academic institutions, or customer-sponsored contract research organizations that are developing methods to deliver a wide variety of molecules, genes or proteins to targeted brain tissue or structures (our “Partners”) that would need to bypass the blood-brain barrier for the treatment of a variety of disorders. This is a novel area in which commercialization must be preceded by FDA-mandated clinical trials, which are expensive and time consuming to conduct, and for which the commercial success is uncertain, pending, in part, on the outcome of those trials. While our revenue from sales of products and services to our biologics and drug delivery customers is indicative of growth, the number of Partner relationships is also of importance as we recognize the possibility that some Partners’ research will reach commercial success, and others may not. To the extent our Partners achieve commercial success, our expectation is that we will share in such success through our Partners’ use of our products and services in their delivery of therapies. At March 31, 2026, we had more than 60 Partners, similar to the number of Partners as of the same date in 2025.
Cost of revenue includes the direct costs associated with the assembly and purchase of components for neurosurgery navigation products, biologics and drug delivery products, non-neurosurgery therapy products, and capital equipment that we have sold, and for which we have recognized revenue in accordance with our revenue recognition policy, as well as labor hours for the cost of providing preclinical, consulting,preclinical and serviceconsulting revenue.services. Cost of revenue also includes the allocation of manufacturing overhead costs and depreciation of loaned systems installed under our ClearPoint placement program, as well as provisions for obsolete, impaired, or excess inventory.
Our research and development costs consist primarily of costs associated with the conceptualization, design, testing, and prototyping of our ClearPoint system products, cannulas, and enhancements. Such costs include salaries, travel, and benefits for research and development personnel; materials and laboratory supplies in research and development activities; outside consultant costs; and licensing costs related to technology not yet commercialized. We anticipate that, over time, our research and development costs may increase as we: (i) develop devices and services for delivery of therapeutics into the central nervous system, (ii) expand products into the ORoperating room and therapeutics space, (iii) expand the application of our technological platforms internationally, and (iv) invest in the IRRAflow product portfolio and clinical evidence.evidence, and (v) develop robotics and focused ultrasound technologies.
Our sales and marketing, and general and administrative expenses consist primarily of salaries, incentive-based compensation, travel and benefits, including related share-based compensation; marketing costs; professional fees, including fees for outside attorneys and accountants; occupancy costs; insurance; and other general and administrative expenses, which include, but are not limited to, corporate licenses, director fees, hiring costs, taxes, postage, office supplies, information technology and meeting costs. We expect increases in our sales and marketing expenses as a result of thea larger combined sales organization,organization following the IRRAS acquisition, primarily reflecting higher salary and personnel-related costs associated with the larger commercial team following the IRRAS acquisition.
There have been no significant changes in our critical accounting policies and estimates during the threesix months ended MarchJune 31,30, 2026, as compared to the critical accounting policies and estimates described in our 2025 10-K.
Three Months Ended MarchJune 31,30, 2026, Compared to the Three Months Ended MarchJune 31,30, 2025
Revenue. Total revenue was $12.1$10.9 million for the three months ended MarchJune 31,30, 2026, and $8.5$9.2 million for the three months ended MarchJune 31,30, 2025, which represents an increase of $3.6$1.7 million, or 43%.18%.
Biologics and drug delivery revenue,revenue which includes sales of disposable products and services relateddecreased to customer-sponsored preclinical and clinical trials utilizing our products, increased slightly to $4.8$4.0 million for the three months ended MarchJune 31,30, 2026 from $4.7 million for the three months ended MarchJune 31,30, 2025. This increasedecrease is attributable to higherlower product revenue.revenue due to a single customer order that occurred in the quarter of the prior year and did not recur in the current quarter.
Neurosurgery navigation and therapy revenue,revenue whichincreased primarily consists of disposable product commercial sales related62% to cases utilizing the ClearPoint and IRRAflow systems, increased 80% to $5.9$5.6 million for the three months ended MarchJune 31,30, 2026, from $3.3$3.4 million for the same period in 2025. The increase is driven primarily by additional revenues due to sales of the IRRAflow product as well as the introduction of our 3.0 operating room navigation software, which has positively impacted procedural volumes in the operating room during the three months ended MarchJune 31,30, 2026, compared to the same period in 2025. We acquired the IRRAflow product in connection with our acquisition of IRRAS in the fourth quarter of 2025.
Capital equipment and software revenue, consisting of sales of ClearPoint and IRRAflow reusable hardware and software and related services,revenue increased 177%24% to $1.4$1.3 million for the three months ended MarchJune 31,30, 2026, from $0.5$1.0 million for the same period in 2025 primarily due to an increase in placements of ClearPoint navigation capital and software, IRRAflow control units, and Prism laser units.
Cost of Revenue and Gross Profit. Cost of revenue was $4.4$4.2 million, resulting in gross profit of $7.8$6.7 million for the three months ended MarchJune 31,30, 2026, and was $3.4$3.7 million, resulting in gross profit of $5.1$5.6 million for the three months ended MarchJune 31,30, 2025. Gross margin was 64%62% for the three months ended MarchJune 31,30, 2026, as compared to 60% in the same period in 2025. The increase in gross margin is primarily due to lower excess and obsolete inventory for the three months ended MarchJune 31,30, 2026, as compared to the same period in 2025.
Research and Development Costs. Research and development costs were $4.5$4.6 million for the three months ended MarchJune 31,30, 2026, compared to $3.4$3.8 million for the same period in 2025, an increase of $1.1$0.8 million, or 34%.21%. The increase was due primarily to higher personnel costs of $0.6 million, and higher product and software development costs of $0.3$0.8 million.
Sales and Marketing Expenses. Sales and marketing expenses were $6.7$6.8 million for the three months ended MarchJune 31,30, 2026, compared to $3.8$4.0 million for the same period in 2025, an increase of $2.9$2.7 million, or 75%.68%. This increase was due primarily to additional personnel costs of $1.9$1.8 million and increases in travel costs of $0.5$0.3 million, resulting from the expansion of our clinical and sales teams,teams. asThe wellincrease aswas also driven by additional amortization expense of acquired intangiblesintangible assets of $0.2 million and marketing material costs of $0.2 million.
General and Administrative Expenses. General and administrative expenses were $5.0$5.6 million for the three months ended MarchJune 31,30, 2026, compared to $4.1$3.4 million for the same period in 2025, an increase of $0.9$2.2 million, or 22%.64%. This increase was due primarily to higherincreases in occupancy costs of $0.7 millionmillion, professional service fees of $0.5 million, personnel costs of $0.3 million, general corporate costs of $0.3 million, and higherinformation personneltechnology and software costs of $0.2 million.
Interest Income. Interest income was $0.4$0.3 million for each of the three months ended MarchJune 31,30, 2026,2026 compared to $0.2 million for the three months ended March 31,and 2025. The increase is due to higher investment in U.S. government debt securities.
Interest Expense. Interest expense was $1.4 million for the three months ended MarchJune 31,30, 2026, compared to no$0.4 interest expensemillion for the threesame monthsperiod endedin March2025, 31,an 2025.increase of $1.0 million. Interest expense increased due to the issuance of notes payable in May and November 2025. See Note 8 to the condensed consolidated financial statements included in Part I, Item 1elsewhere in this Quarterly Report for additional information with respect to the notes payable issued in May and November 2025.
Six Months Ended June 30, 2026, Compared to the Six Months Ended June 30, 2025
NM – The percentage change is not meaningful.
Revenue. Total revenue was $23.0 million for the six months ended June 30, 2026, and $17.7 million for the six months ended June 30, 2025, which represents an increase of $5.3 million, or 30%.
Biologics and drug delivery revenue decreased to $8.8 million for the six months ended June 30, 2026 from $9.4 million for the six months ended June 30, 2025. This decrease is attributable to lower product revenue due to a single customer order that occurred in the six-month period of the prior year and did not recur in the current period. In general, this category of revenue is impacted by timing of our Partners’ drug development programs and tends to be uneven quarter to quarter.
Neurosurgery navigation and therapy revenue increased 71% to $11.4 million for the six months ended June 30, 2026, from $6.7 million for the same period in 2025. The increase is driven primarily by additional revenues due to sales of the IRRAflow product as well as the introduction of our 3.0 operating room navigation software, which has positively impacted procedural volumes in the operating room during the six months ended June 30, 2026, compared to the same period in 2025. We acquired the IRRAflow product in connection with our acquisition of IRRAS in the fourth quarter of 2025.
Capital equipment and software revenue increased 75% to $2.7 million for the six months ended June 30, 2026, from $1.6 million for the same period in 2025 primarily due to an increase in placements of ClearPoint navigation capital and software, IRRAflow control units, and Prism laser units.
Cost of Revenue and Gross Profit. Cost of revenue was $8.5 million, resulting in gross profit of $14.5 million for the six months ended June 30, 2026, and was $7.0 million, resulting in gross profit of $10.7 million for the six months ended June 30, 2025. Gross margin was 63% for the six months ended June 30, 2026, as compared to 60% in the same period in 2025. The increase in gross margin is primarily due to lower excess and obsolete inventory for the six months ended June 30, 2026, as compared to the same period in 2025.
Research and Development Costs. Research and development costs were $9.2 million for the six months ended June 30, 2026, compared to $7.2 million for the same period in 2025, an increase of $1.9 million, or 27%. The increase was due primarily to increases in personnel costs of $1.4 million, repair costs of $0.2 million, quality audit fees of $0.1 million, and travel costs of $0.1 million.
Sales and Marketing Expenses. Sales and marketing expenses were $13.5 million for the six months ended June 30, 2026, compared to $7.9 million for the same period in 2025, an increase of $5.6 million, or 72%. This increase was due primarily to additional personnel costs of $3.7 million and increases in travel costs of $0.8 million, resulting from the expansion of our clinical and sales teams. The increase was also driven by additional amortization expense of acquired intangible assets of $0.4 million and marketing material costs of $0.4 million.
General and Administrative Expenses. General and administrative expenses were $10.6 million for the six months ended June 30, 2026, compared to $7.5 million for the same period in 2025, an increase of $3.1 million, or 41%. This increase was due primarily to increases in occupancy costs of $1.3 million, personnel costs of $0.5 million, professional service fees of $0.5 million, information technology and software costs of $0.4 million, and general corporate costs of $0.4 million.
Interest Income. Interest income was $0.6 million for the six months ended June 30, 2026, compared to $0.4 million for the same period in 2025, an increase of $0.2 million, or 47%. The increase is due to higher investment in U.S. government debt securities.
Interest Expense. Interest expense was $2.8 million for the six months ended June 30, 2026, compared to $0.4 million for the same period in 2025, an increase of $2.4 million. Interest expense increased due to the issuance of notes payable in May and November 2025. See Note 8 to the condensed consolidated financial statements included elsewhere in this Quarterly Report for additional information with respect to the notes payable issued in May and November 2025.
We have incurred net losses since our inception as we have devoted substantial efforts to research and development, which has resulted in a cumulative deficit at MarchJune 31,30, 2026 of $226.5$237.8 million. Our use of cash from operations amounted to $8.0$15.0 million for the threesix months ended MarchJune 31,30, 2026, and $23.9 million for the year ended December 31, 2025. Our primary uses of cash and operating expenses relate to paying employees and consultants, marketing our products, and supporting our research and development of future product offerings. Since inception, we have financed our operations principally from the sale of equity securities and the issuance of notes payable.
Also in May 2025, we entered into a note purchase agreement under which we may sell tranches of notes in an aggregate principal amount of up to $105.0 million. As of MarchJune 31,30, 2026, we have received net proceeds of approximately $48.1 million from the sale of two notes thereunder. See Note 8 to the condensed consolidated financial statements included elsewhere in this Quarterly Report.
In November 2024, we established an at-the-market equity offering program under which we may offer and sell, from time to time, shares of our common stock having aggregate sales proceeds of up to $50$50.0 million. As of MarchJune 31,30, 2026, we didhad not sellsold any shares of common stock under our at-the-market equity offering program. See Note 10 to the condensed consolidated financial statements included elsewhere in this Quarterly Report.
Our cash and cash equivalents totaled $35.6$29.4 million at MarchJune 31,30, 2026. In management’s opinion, based on our current forecasts, our cash and cash equivalent balances at MarchJune 31,30, 2026 are sufficient to support our operations and meet our obligations for at least the next twelve months from the date of issuance of the condensed consolidated financial statements included elsewhere in this Quarterly Report.
We may offer and sell additional equity or issue additional notes payable to raise funds for working capital, capital expenditures, or other general corporate purposes. Our primary uses of cash and operating expenses relate to paying employees and consultants, marketing our products, and supporting our research and development of future product offerings.
Cash activity for the threesix months ended MarchJune 31,30, 2026 and 2025 is summarized as follows:
Net Cash Flows Used in Operating Activities. Net cash flows used in operating activities for the threesix months ended MarchJune 31,30, 2026 werewas $8.0$15.0 million, an increase of $1.8$6.3 million from the threesix months ended MarchJune 31,30, 2025. This increase was primarily due to a higher net loss of $3.5$9.0 million, which was partially offset by higher non-cash expenses of $1.3$2.5 million attributed to amortization of intangible assets, share-based compensation, and payment-in-kind interest. TheWe changesexpect our net cash used in operating assetsactivities andto liabilitiesdecrease during the remainder of $0.42026 millionas werewe drivenbenefit primarilyfrom bythe increasedcompletion accountsof receivablethe balances,IRRAS reflecting higher revenues and slower collections, partially offset by lower cash use in paying down liabilities.integration.
Net Cash Flows Used in Investing Activities. Net cash flows used in investing activities for the threesix months ended MarchJune 31,30, 2026 and MarchJune 31,30, 2025 werewas $0.6$0.9 million and $0.2$0.3 million, respectively, and related to equipment acquisitions.
Net Cash Flows (Used in) Provided by Financing Activities. Net cash flows used in financing activities for the threesix months ended MarchJune 31,30, 2026 and March 31, 2025 consisted primarily of $2.0 million and $1.3 million, respectively, in payments for taxes related to shares withheld in connection with the vesting of restricted stock.stock awards; partially offset by $0.6 million of proceeds from stock option exercises and $0.5 million of proceeds from the issuance of common stock under our employee stock purchase plan.
Net cash provided by financing activities for the six months ended June 30, 2025 consisted primarily of proceeds, net of financing costs and discount, of $28.7 million from the issuance of a note payable; proceeds, net of offering costs, of $3.3 million from the registered direct offering of common stock; partially offset by $1.7 million in payments for taxes related to shares withheld in connection with the vesting of restricted stock awards.
Our short- and long-term liquidity requirements include the obligations under notes payable and under lease arrangements related to our office and manufacturing facilities under non-cancellable operating leases. See Notes 88, 9, and 912 to the condensed consolidated financial statements included elsewhere in this Quarterly Report. We typically enter into short-term agreements with vendors and suppliers of goods and services in the normal course of business through purchase orders, which are settled in cash upon our receipt of such goods or services. We may also at times enter into long-term commitments or license and collaboration agreements which require commitments that are noncancellable. See Note 10 to the consolidated financial statements included in our 2025 10-K.
the cost and timing of completing the build-out of, and achieving operational readiness at, our ClearPoint Advanced Laboratories facility, including the purchase and installation of related equipment;
the scope, rate of progress and cost of our ongoing product development activities relating to our productsproducts, including our development of robotics and focused ultrasound technologies;
the cost and timing of expandingexpenditures ourfor sales, clinical support, marketing and distribution capabilities, and other corporate infrastructure;
the duration and impact of macroeconomic trends, including inflationary pressures, changes in monetary policy, decreasingconstraints consumeron confidencehospital andcapital spending, the introduction of or changes in tariffs or trade barriers, global or local recession and geopolitical instability; and the effect of competing technological and market developments.
CLPT insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 5 filings (4 insiders, 5 trade dates, 108,349 shares, about $1.8M; 3 of these filings say the sales were made under a Rule 10b5-1 trading plan). Net open-market shares: -108,349 (purchases minus sales); net value about -$1.8M.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-10-01 | Richards Timothy T. |
Grant/award | 319 | $12.21 | $3.9K |
| 2026-10-01 | Fletcher R John |
Grant/award | 993 | $12.21 | $12.1K |
| 2026-09-02 | Burnett Joseph |
Option exercise | 12,517 | $3.47 | $43.4K |
| 2026-07-01 | Fletcher R John |
Grant/award | 662 | $17.84 | $11.8K |
| 2026-07-01 | Richards Timothy T. |
Grant/award | 222 | $17.84 | $4.0K |
| 2026-06-30 | Stigall L. Jeremy |
Grant/award | 1,781 | $11.93 | $21.2K |
| 2026-06-30 | D'alessandro Danilo |
Grant/award | 1,085 | $11.93 | $12.9K |
| 2026-06-30 | Burnett Joseph |
Grant/award | 1,361 | $11.93 | $16.2K |
| 2026-06-29 | Burnett Joseph |
Option exercise |
20,000 | $2.50 | $50.0K |
| 2026-06-29 | Burnett Joseph |
Open-market sale |
20,000 | $19.38 | $387.6K |
| 2026-06-17 | Burnett Joseph |
Open-market sale |
1,843 | $17.94 | $33.1K |
| 2026-06-17 | Burnett Joseph |
Open-market sale |
60,000 | $17.79 | $1.1M |
| 2026-06-17 | Burnett Joseph |
Option exercise |
60,000 | $2.50 | $150.0K |
| 2026-06-04 | Richards Timothy T. |
Shares withheld for tax | 376 | $13.30 | $5.0K |
| 2026-06-04 | Richards Timothy T. |
Option exercise | 500 | $10.00 | $5.0K |
| 2026-06-01 | Richards Timothy T. |
Open-market sale | 5,415 | $12.17 | $65.9K |
| 2026-05-21 | Klein Matthew B. |
Open-market sale | 16,000 | $11.59 | $185.4K |
| 2026-05-20 | Fallon Lynnette C |
Open-market sale |
5,091 | $11.14 | $56.7K |
| 2026-05-19 | Klein Matthew B. |
Option exercise | 12,417 | — | — |
| 2026-05-19 | Fallon Lynnette C |
Option exercise |
12,417 | — | — |
| 2026-05-19 | Fletcher R John |
Option exercise | 12,417 | — | — |
| 2026-05-19 | Richards Timothy T. |
Option exercise | 12,417 | — | — |
| 2026-05-19 | Johnson B Kristine |
Option exercise | 12,417 | — | — |
| 2026-05-19 | Girin Pascal E R |
Option exercise | 12,417 | — | — |
| 2026-05-19 | Liau Linda M. |
Option exercise | 12,417 | — | — |
Well-known investors holding CLPT (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| Millennium Management (Israel Englander) | 2026-06-30 | 357,676 | $6.4M | 0.0% | Added 54% |
| Two Sigma Investments | 2026-06-30 | 154,851 | $2.8M | 0.0% | Reduced 27% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 48,688 | $868.6K | 0.0% | New position |