IART 10-K & 10-Q changes, risk factors and insider trading

The United States and foreign countries have experienced recessionary pressures and face continued concerns about the systemic impacts of adverse economic conditions and geopolitical issues. Any negative impact on economic conditions and international markets, including increased geopolitical instability and other macroeconomic factors, including heightened inflation, trade barriers and related restrictions (including tariffs and related countermeasures), import or export licensing requirements, armed conflict and acts of terrorism, geopolitical tension and instability, supply chain disruptions, interest rate and foreign currency rate fluctuations, and volatility in the capital markets could negatively impact our business, financial condition, and results of operations.

Continued concerns about the systemic impact of potential long-term and wide-spread recession and geopolitical issues, including wars, such as the war between Russia and Ukraine and the conflicts in the Middle East involving Israel, and acts of terrorism, have contributed to increased market volatility and diminished expectations for economic growth in the world. Our business and results of operations have been and may continue to be adversely impacted by changes in macroeconomic conditions, including inflation, rising interest rates, bank failures and the accessibility of capital markets. Uncertainty about global economic and geopolitical conditions may also cause decreased demand for our products and services and increased competition, which could result in lower sales volume and downward pressure on the prices for our products, longer sales cycles, and slower adoption of new technologies. Such conditions may also constrain the liquidity of hospitals and other customers or limit their access to financing, which could further delay or reduce capital equipment purchases. A weakening of macroeconomic conditions may also adversely affect our suppliers, which could result in interruptions in supply. In addition, heightened macroeconomic and geopolitical uncertainty may impair our ability to accurately forecast demand and plan our business and operational activities.

Market acceptance of our medical products in the U.S. and other countries is dependent upon the medical equipment purchasing and procurement practices of our customers, patient need for our products and procedures and the reimbursement of patients' medical expenses by government healthcare programs and third-party payors. The continuing uncertainty surrounding global economic conditions and financial markets may cause the purchasers of medical equipment to decrease their procurement activities.activities, particularly the sales of capital equipment such as our ultrasonic surgical aspirators, neuro monitors and cranial stabilization products. Economic uncertainty, an increase in unemployment rates, as well as increasing health insurance premiums, co-payments and deductibles may adversely affect demand for our products and elective or non-reimbursed procedures. Furthermore, governments and other third-party payors around the world facing tightening budgets could move to further reduce the reimbursement rates or the scope of coverage offered, which could adversely affect the sales of our products.

•inspections of our manufacturing facilities for compliance with FDA’s Quality Management System Regulations (Good Manufacturing Practices), which have resulted in, and could result in future Form 483 observations, warning letters, injunctions or other adverse findings from the FDA or from equivalent regulatory bodies, and corrective actions, procedural changes and other actions that we determine are necessary or appropriate to address the results of those inspections, any of which may affect production and our ability to supply our customers with our products, including resuming the manufacture and sale of products subjection to prior voluntary recalls;

•expenditures for major initiatives, including acquired businesses and integrations thereofthereof, restructuring and restructuringthe development and implementation of the CMP;

•disruption of our operations and sales resulting from political instability, war, including the war between Russia and Ukraine and the conflicts in the Middle East involving Israel, insurrections, extreme weather conditions, the outbreak of disease, natural disasters, or other events outside our control that damage our manufacturing, distribution, or infrastructure of those facilities, or the suppliers and service providers for those facilities;

•risks related to public health concerns or crises, including epidemics and pandemics such as COVID-19,pandemics, which may negatively impact certain aspects of our business, including the demand for and supply of certain of our products, operations, supply chains and distribution systems, and our ability to generate cash flow;

•the impact of changes to our sales organization,organization and continued channel expansion, including increased specialization;

There is intense competition among medical device companies. We compete with established medical technology companies in many of our products. Competition also comes from early-stage companies, universities, research institutions and other non-profit entities. In certain cases, our products compete primarily against medical practices that treat a condition without using a device or any particular product, such as the medical practices that use autograft tissue instead of our dermal regeneration products, duraplasty products and nerve repair products, or that use other technologies that cost less than our products. Many of our competitors have access to greater financial, technical, research and development, marketing, manufacturing, sales, distribution, administrative, consulting and other resources than we do. Our competitors may be more effective at developing commercial products or navigating the regulatory approval process in the markets in which we operate. TheyIn mayaddition, beunfavorable ablepayment to gain market share by offering lower-cost productsamounts or productsadverse thatcoverage enjoydeterminations betterof reimbursementprivate fromand third-partypublic payorshealth insurers, such as Medicare and Medicaid, and foreign governmental health systems.systems, regarding our products or third-party determinations that favor a competitor’s product over ours, could harm acceptance or continued use of our products.

Our global business exposes us to operationalcertain operational, compliance and economic risks.

A significant portion of our current operations are conducted and located outside the United States, and our growth strategy involves expanding our existing foreign operations and entering into new foreign jurisdictions. We have significant manufacturing and distribution sites in North America, Europe, China and Japan. Our acquisition of Acclarent resulted in our acquiring research-and-development facilities and personnel located in Israel. As we seek to continue to expand and strengthen our international operations, we may experience difficulty in growing our sales in certain new markets and other international markets in which we are attempting to increase our presence due to, among other things, customer acceptance, undeveloped and/or unfamiliar distribution channels, regulatory restrictions and changes, and business knowledge of these markets.

Since we have operations based outside the U.S. and we generate revenues and incur operating expenses in multiple foreign currencies, we experience currency exchange risk with respect to those foreign currency-denominated revenues and expenses. Our most significant currency exchange risk relates to transactions conducted in Australian dollars,Euros, British pounds, Swiss francs, Canadian dollars, Chinese yuan, Euros, Japanese yen, Israeli shekel, Australian dollars and SwissChinese francs.yuan.

We are required to test both goodwill and indefinite-lived intangible assets for impairment on an annual basis based upon a fair value approach, rather than amortizing them over time. We are also required to test goodwill and indefinite-lived intangible assets for impairment between annual tests if an event occurs such as a significant decline in revenues or cash flows for certain products, or the discount rates used in the calculations of discounted cash flows change significantly, or circumstances change that would more likely than not reduce our enterprise fair value below its book value. If such a decline, rate change or circumstance were to materialize, we may record an impairment of these intangible assets that could be material to the financial statements. SeeFor example, during the second quarter of 2025 we recognized an aggregate charge of $511.4 million in goodwill impairment expense in our consolidated statement of operations following our completion of a quantitative assessment of our Tissue Technologies, Neurosurgery, and Instruments and ENT reporting units in accordance with ASC 350. The quantitative assessment was initiated following the decrease in the price per share of our common stock related to a number of factors including recent tariff changes that have created broad economic uncertainty and the impact of quality, operational, and supply issues. For more information concerning the goodwill impairment charge we recorded in 2025 and related matters, please see Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Estimates” of this Annual Report on Form 10-K, and Note 7. Goodwill and Other Intangibles to the Notes to Consolidated Financial Statements (Part IV, Item 15 of this Annual Report on Form 10-K).

Outside vendors, some of whom are sole-source suppliers, provide key componentscomponents, raw materials, packaging materials and rawcomponents, materialssterilization services, and some finished goods used in the manufacture of our products. Although we believe that alternative sources for many of these componentscomponents, raw materials, packaging materials and rawsome materialsfinished goods are available, any interruption in supply of a limited or sole-source component or raw material could harm our ability to manufacture our products until a new or alternative source of supply is identified and qualified. In addition, an uncorrected defect or supplier’s variation in a component or raw material, either unknown to us or incompatible with our manufacturing process, could harm our ability to manufacture products and create inventory shortages of our products. We may not be able to find a sufficient alternative supplier in a reasonable time period, or on commercially reasonable terms, if at all, and our ability to produce and supply our products could be impaired. We believe that these factors are most likely to affect the following products that we sell:

Our supply chain and our cost of goods also may be negatively impacted by unanticipated price increases due to factors such as global economic disruptions, electronic component shortages, trade wars, inflation, including wage inflation, recessionary conditionsconditions, geopolitical conflict and geopolitical events,instability, including thewars warand inacts Ukraine,of the conflicts in the Middle East involving Israelterrorism, and fear of future or ongoing pandemics, all of which are beyond our control or the control of our suppliers.

While it is our policy to maintain sufficient inventory of components so that our production will not be significantly disrupted even if a particular component or material is not available for a period of time, we remain at risk that we will not be able to qualify new components or materials quickly enough to prevent a disruption if one or more of our suppliers ceases production of important componentscomponents, materials or materials.sterilization services.

In recent years, we consolidated several facilities or transferred manufacturing operations (including between third parties, from third parties to our existing internal manufacturing facilities, and from our existing manufacturing facilities to new internal manufacturing facilities) and may further undertake similar consolidations or transfers in the future in order to improve our cost structure, achieve increased operating efficiencies,efficiencies and reliability, and improve our competitive standing or results of operations and/or to address unfavorable economic conditions. For example, in the second quarter of 2024, the Company has announced its plans to operationalize its Braintree, Massachusetts manufacturing facility (the “Braintree facility”) by the first half of 2026 and to transition the restart of the manufacture of PriMatrix and SurgiMend to the Braintree facility rather than attempt to restart the manufacture of these products at the Company’s Boston, Massachusetts manufacturing facility (the “Boston facility”). The consolidation, transfer or operationalization of manufacturing facilities requires such facilities to meet all applicable requirements related to quality control, quality assurance, and the maintenance of records and documentation as required by the FDA and any other applicable regulatory body both before and following the commencement of the manufacture of any approved product at such facility. For more information concerning the regulation related to our products, please refer to the risk factors appearing under the heading “—Risks Related to Our Regulatory Environment” below. As part of these initiatives, we may also lose favorable tax incentives or not be able to renew leases on acceptable terms. We may further reduce staff, make changes to certain capital projects, close certain production operations and abandon leases for certain facilities that will not be used in our operations. In conjunction with any actions, we will continue to make significant investments and build the framework for our future growth. We may not realize, in full or in part, the anticipated benefits and savings from these efforts because of unforeseen difficulties, delays, implementation issues or unexpected costs. If we are unable to achieve or maintain all of the resulting savings or benefits to our business or other unforeseen events occur, our business and results of operations may be adversely affected.

Damage to our manufacturing, distribution, development and/or research facilities because of fire, extreme weather conditions, natural disaster, power loss, communications failure, geopolitical disruption, unauthorized entry or other events, such as a flu or other health epidemic, could significantly disrupt our operations, the operations of suppliers and critical infrastructure and delay or prevent product manufacture and shipment during the time required to repair, rebuild or replace the damaged facilities. Certain of our manufacturing facilities are located in Puerto Rico, which in the past has experienced both severe hurricanes and other natural disasters. Climate change may increase both the frequency and severity of extreme weather conditions and natural disasters and, consequently, risks to our operations and growth. Although we maintain property damage and business interruption insurance coverage on these facilities, our insurance might not cover all losses under such circumstances, and we may not be able to renew or obtain such insurance in the future on acceptable terms with adequate coverage or at reasonable costs. Moreover, climate change may increase both the frequency and severity of extreme weather conditions and natural disasters and, consequently, risks to our operations and growth.

Global supplySupply constraints have and may continue to adversely affect our ability to meet customer demand, and increase our costs to manufacture, transport and warehouse a certain subset of our products. In addition, global supply constraints have resulted in increases to the costs of production of certain of our products that we may not be able to pass on to our customers. We expect these factors will continue to impact us in the future and obtaining alternative sources of raw materials and components could involve significant costs and regulatory challenges and may not be available to us on commercially reasonable terms, if at all.

Our medical devices and technologies, development activities and manufacturing processes are subject to extensive and rigorous regulation by numerous government agencies, including the FDA and comparable foreign agencies, as discussed in “Part 1, Item 1. Business – Government Regulation” of this Annual Report on Form 10-K. To varying degrees, each of these agencies monitors and enforces our compliance with laws and regulations governing the development, testing, manufacturing, labeling, marketing and distribution of our medical devices. We are also subject to regulations that may apply to certain of our products that are Drug/Device Combination products or are considered to be subject to pharmaceutical regulations outside the U.S. Before a new medical device, or a new use of an existing product can be marketed in the United States, it must first receive either premarket clearance under Section 510(k) of the FD&C Act, a grant of a request for de novo classification, or a PMA from the FDA, unless an exemption applies. The process of obtaining marketing approval or clearance from the FDA and comparable foreign regulatory agencies for new products, or for enhancements or modifications to existing products could be costly, time consuming and burdensome, may be impacted by failed clinical trials or weakened clinical evidence, involve modifications, repairs or replacements of our products and result in limitations on the indicated use of our products, which may negatively impact our ability to market our products and services, result in delays or prevent full commercial realization of future products or service. Furthermore, failure to obtain timely approvals, certifications or renewals may result in penalties and fines. Additional regulations govern the approval, initiation, conduct, monitoring, documentation and reporting of clinical studies to regulatory agencies in the countries or regions in which they are conducted. Failure to comply, could subject us to significant enforcement actions and sanctions, including halting the study, rejection of data generated in the study, seizure of investigational devices or data, sanctions against investigators, civil or criminal penalties, and other actions. In addition, without the data from one or more clinical studies, it may not be possible for us to secure the data necessary to support certain regulatory submissions, to secure reimbursement or demonstrate other requirements. We cannot assure that access to clinical investigators, sites and subjects, documentation and data will be available on the terms and timeframes necessary. We also cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative or executive action, either in the United States or abroad. Further,In changesaddition, orgovernment shortagesshutdowns, recent reductions in FDAU.S. government agency staffing resultingand fromgovernment spending more generally could impact ordinary course operations of agencies with which we interact routinely, such as the changeFDA. inFollowing these reductions, the federalagencies administrationmay couldlack resultadequate instaff delaysand in the FDA’s responsiveness or in its abilityresources to reviewmeet submissionscurrent orreview, applications,approval issueand regulationsinspection or guidance, or implement or enforce regulatory requirements in a timely fashion or at all,schedules, which could negativelydelay impactthe ourreceipt business.of or otherwise adversely affect the outcomes of product authorizations we seek.

We are subject to extensive complex regulatory requirements by domestic and foreign government agencies and any failure to comply with our ongoing responsibilities under their applicable laws and regulations could result in a material adverse impact on our business. Failure to comply with applicable regulations could result in reduced sales, increased costs, delays to new product introductions, harm to our reputation or competitiveness, future product recalls, injunctions preventing the shipment of products or other enforcement actionsactions, thatall of which could have a material adverse effect on our business.business and financial results. In addition, the FDA has taken the position that device manufacturers are prohibited from promoting their products other than for the uses and indications set forth in the cleared or approved product labeling, and any failure to comply could subject us to significant civil or criminal exposure, administrative obligations and costs, and/or other potential penalties from, and/or agreements with, the federal government. Similar restrictions exist in many other countries where we do business, includedincluding the EEA.

Under the EU MDR, companies that wish to manufacturemanufacture, import and distribute medical devices in EEA must meet certain quality system, performance and safety requirements as well as ongoing product monitoring responsibilities. Companies must also affix a “CE” marking to their products. The right to affix the “CE” marking requires that the manufacturer has previously undergone a conformity assessment procedure for the relevant medical devices, in most cases involving a Notified Body (an organization accredited by the competent authority of an EEA country to conduct conformity assessments). Complying with the requirements of these regulations may require us to incur significant expenditures. Expenditures for EU MDR compliance activities amounted to $44.6$41.9 million for the year ended December 31, 20242025 and we anticipate incurring additional expenditures in connection with our on-going efforts to obtain certification for our products under the EU MDR. Various penalties exist for non-compliance with the requirements of the EU MDR and the related laws of EEA countries which, if incurred, could have a material adverse impact on our business, results of operations and cash flows.

We are subject to laws and regulations that govern the means by which companies in the healthcare industry may market their products to healthcare professionals and may compete by discounting the prices of their products, including for example, the federal AKS, the False Claims Act, HIPAA, state law equivalents to these federal laws that are meant to protect against fraud and abuse and analogous laws in foreign countries. Violations of these laws are punishable by criminal and civil sanctions, including, but not limited to, in some instancesinstances, civil and criminal penalties, damages, fines, restitution and exclusion from participation in federal and state healthcare programs, including Medicare and Medicaid. For a more detailed discussion of these laws, see “Item 1. Business — Government Regulation and Compliance — Other Regulations — Healthcare Fraud and Abuse Laws.”

Maintaining compliance with multiple regulators, and multiple centers within the FDA, adds complexity and cost to our manufacturing processes. Both before and after a device is placed on the market, numerous regulatory requirements apply, which require manufacturers to follow, among other things, design, testing, production, control, documentation and other quality assurance procedures during the manufacturing process; labeling regulations, which prohibit the promotion of unapproved products foror unapproved or “off-label” uses of cleared or approved products and impose other restrictions on labeling; and medical device reporting regulations that require us to report to FDA or similar governmental bodies in other countries if our products are ineffective or may have caused or contributed to a death or serious injury or malfunction in a way that would be reasonably likely to contribute to death or serious injury if the malfunction were to recur. The FDA and similar governmental bodies in other countries have the authority to require the recall, repair, replacement, or refund of such products, refuse to grant pending pre-market approval applications or require certificates of non-U.S. governments for exports, and/or require us to notify health professionals and others that the devices present unreasonable risks of substantial harm to the public health, and in certain rare circumstances, ban medical devices. We may voluntarily recall a product if a reasonable possibility of serious injury or any material deficiency in a device is found, or withdraw a product to improve device performance or for other reasons. For example, in May 2023, after consultation with the FDA, we initiated a voluntary global recall of all products manufactured in our Boston facility distributed between March 1, 2018 and May 22, 2023. Additionally, in response to Form 483s issued to the Company by the FDA at the conclusion of the FDA’s inspection of three of the Company’s facilities located in Mansfield, Massachusetts, Plainsboro, New Jersey, and Princeton, New Jersey during June and August of 2024, the Company took a number of voluntary actions including the initiation of shipping holds for several products and a voluntary recall of certain disposable cottonoid patties and strips. In July 2024, we announced plans to implement an enterprise-wide CMP, a systematic and holistic approach to improving our quality management system across our manufacturing and supply network. We currently cannot predict with certainty whether we will be able to effectively implement the CMP and realize the benefits contemplated thereby within the anticipated timeframe, or at all. Further, there can be no assurance that the Company will build and operationalize the Braintree facility, transition manufacturing activities to the Braintree facility or realize the anticipated benefits of the Company’s consolidation of its efforts at Braintree on the planned timeline, or at all, which could have a material adverse effect on our business and financial results. For more information concerning our remediation efforts, including the status of the implementation of the CMP, and our expectations regarding the Company’s plans to build and operationalize the Braintree manufacturing facility and to transition manufacturing activities from the Boston facility to the Braintree facility and respond to the December 2024 Warning Letter, please see "“Item 7. Management'sManagement’s Discussion and Analysis of Financial Condition and Results of Operations - FDA Matters"” in this Annual Report on Form 10-K.

Recalls of any of our products may divert managerial and financial resources and have an adverse effect on our financial condition and results of operations and cash flows. A recall might not only impact our results of operations and financial results but also could harm our reputation with customers and consumers which could reduce the future sales of our products. In addition, the FDA or other foreign governmental agencies may implement enforcement actions Any adverse regulatory action, depending on its magnitude, may place us under heightened scrutiny by the FDA and other regulators, including more frequent or more extensive inspections and increased monitoring of our quality and compliance activities, may restrict us from effectively marketing and selling our products and subject us to increased requirements for documentation or data in connection with future submissions or otherwise limit our ability to obtain future pre-market clearances or approvals, and could result in a substantial modification to our business practices and operations.

Integra products are sold in more than 120 countries through a direct sales force as well as distributors and wholesalers. We manufacture and sell medical technologies and products in two reportable business segments: Codman Specialty Surgical (“CSS”) and Tissue Technologies (“TT”). The CSS segment, which represents approximately two-thirds70% of our total revenue, consists of market-leading technologies and instrumentation used for a wide range of specialties, such as neurosurgery, neurocritical carecare, and otolaryngology.otolaryngology, commonly referred to as ear, nose, and throat (“ENT”). We are the world leader in neurosurgery and one of the top three providers in the U.S. in instruments used in precision, specialty, and general surgical procedures. Our TT segment generates about one-third30% of our overall revenue and focuses on three main areas: complex wound surgery, surgical reconstruction,reconstruction and peripheralcare nerveand repair.private label.

NewNEW ProductPRODUCT IntroductionsINTRODUCTIONS andAND ResearchRESEARCH andAND Development UpdatesDEVELOPMENT

Neurosurgical Solutions, Surgical Instruments, and ENT Solutions. The CSS neurosurgical business consists of a broad portfolio of market-leading brands, such as Codman®, DuraGen®, DuraSeal®, CUSA®, CereLink®, Mayfield®, Bactiseal®, and Certas® Plus, which are used for the management of multiple disease states, including brain tumors, traumatic brain injury, hydrocephalus and other neurological conditions. The growth in this business in recent years has been fueled by geographic expansion and new product registrations in markets, such as China, Japan, and   Europe, which we expect to continue in the near-to-long term. Because our electromechanical products and instruments address significant needs in surgical procedures and limit uncertainty for surgeons, we continue to invest in registrations, clearances, and approvals for new indications and next generation improvements to our market-leading products. We have several active programs focused on life cycle management and innovation for capital and disposable products in our portfolio. Our product development efforts are focused on core clinical applications in cerebrospinal fluid (“CSF”) management, neuro-critical care monitoring, minimally invasive instruments and electrosurgery and ultrasonic medical technologies, as well as our ambition to transform the standard of care in neurosurgery with product advancements in minimally invasive surgery (“MIS”) and the surgical management of intracerebral hemorrhage (“ICH”). Our lighting franchise is among the most dynamic in the industry.

We also continuedcontinue to advance the early-stage technology platforms we acquired in 2019. Through the acquisition of Arkis Biosciences, Inc. (“Arkis”) we added a platform technology, CerebroFlo® external ventricular drainage (“EVD”), a catheter with Endexo® technology,technology. The Endexo polymer in polyurethane is a permanent additive designedwhich has shown to reducebe effective in reducing platelet adhesion in-vitro, reducing thrombus accumulation in-vitro and in vivo, and reducing the potentialclinical forincidence catheterof obstructionthrombus dueformation. In vitro evaluations and in vivo animal evaluations do not necessarily predict the clinical performance of the SureFlo EVD Catheter with respect to thrombus formation. The incidence of thrombus formation on polyurethane containing Endexo polymer in other medical devices and/or tissues systems does not necessarily predict the clinical performance of the SureFlo EVD Catheter for the intended use of CSF external drainage and monitoring. The CerebroFlo EVD catheter has demonstrated an average of 99% less thrombus accumulation onto its surface, in vitro, compared to a market leading EVD catheter. Our work to combine our Bactiseal® antimicrobial technology with the Endexo anti-occlusive technology continues to progress for both a silicone-based hydrocephalus and EVD project.product.

We also continuedcontinue to advance our innovation from the Rebound Therapeutics Corporation (“Rebound Therapeutics”), which was acquired in 2019. Rebound Therapeutics specializes in a single-use medical device, known as the Aurora® Surgiscope, which is the only tubular retractor system designed for cranial surgery with an integrated access channel, camera and lighting. The 9mm15mm x 60mm and 15mm x 80mm Aurora Surgiscope System version received 510(k) clearance from the FDA in the fourth quarter of 2023.2025.

Regenerative Technologies. We were the first company to receive an FDA claim for regeneration of dermal tissue and are a world leader in regenerative technology. Our regenerative technology development program applies our expertise in bioengineering to a range of biomaterials including natural materials such as purified collagen, intact human or animal tissues, honey as well as resorbable synthetic polymers with our DuraSorb and DuraSeal® product lines. These unique product designs are used for neurosurgical and reconstructive surgical applications, as well as dermal regeneration, including the healing of chronic and acute wounds, tendon and nerve repair.regeneration. Our regenerative technology platform includes our legacy Integra® Dermal Regeneration Template (“IDRT”) products and complementary technologies that we have acquired. Our collagen manufacturing capability, combined with our history of innovation, including our launch of NeuraGen 3D, provides us with strong platform technologies for multiple indications.

In the third quarter of 2021, we filed a PMA application for a specific indication for SurgimendSurgiMend® in the use of post-mastectomy breast reconstruction and in July 2024 received approvable pending GMP status from FDA, which approved and closed out the clinical portion of this PMA application. We anticipate PMA approval following the operationalization of the Braintree facility, which is expected in the2026. firstWe halfare ofalso 2026.pursuing a PMA for DuraSorb for use in implant-based breast reconstruction (“IBBR”).

In 2022, we acquired SIA, which has also submitted a PMA application for DuraSorb with IBBR, and in June 2023 weWe completed enrollment infor the DuraSorb U.S. investigational device exemption clinical study for two-stage breast reconstruction in June 2023; and in 2024 we have continuedcontinue to advance the PMA application. Currently, we hope to secure PMA approval for DuraSorb in 2026. By offering two distinct product solutions, we believe we have the opportunity to build a leading position in the IBBR market.

AsWe part of our ongoing efforts to remain compliant, the Company continuescontinue to work towards Europeancertifying Unionour Medicalproducts Device Regulation (“EU MDR”) certifications. Overunder the pastEU twoMDR. In recent years, the Companywe received EU MDR certification in theour CSS segment for Hakim Programmable Valves, Certas Plus with and without Bactiseal catheters, Surgical Patties and Strips, DuraSeal Dural, CUSA Clarity and DuraGen SuturableSuturable, inCranial theDrills CSSand segment,Perforators, as well as IDRT, BioPatch, MicroMatrix, and Cytal in theour TT segment. We do not currently anticipate any significant disruption to our commercial activities in Europe related to EU MDR.

On December 19, 2024, athe subsidiary of Integra LifeSciences Holdings CorporationCompany received a warning letter from the FDA (the “2024 Warning Letter”). The 2024 warningWarning letterLetter relates to quality system issues identified during FDA inspections at three of the Company’s facilities located in Mansfield, Massachusetts,Massachusetts; Plainsboro, New Jersey,Jersey; and Princeton, New Jersey. The warning2024 letterWarning Letter did not identify any new observations that had not already been provided in the Form 483s previously issued to the Company by the FDA at the conclusion of its three inspections in June and August of 2024 (the “2024 Form 483s”). In the 2024 Form 483s, the FDA deemed certain of the Company'sCompany’s devices, including cranial perforators, disposable cottonoid patties and strips, and collagen-based products, to be out of compliance with respect to the quality system regulation.regulations. At that time, the Company took a number of voluntary actions including the initiation of shipping holds for several products and a voluntary recall of the disposable patties and strips. The warning2024 letterWarning Letter does not restrict the Company’s ability to manufacture or ship products, require recall of any products, nor restrict the Company’s ability to seek FDA 510(k) clearance of products. The warning2024 letterWarning Letter states that premarket approval applications for Class III devices to which the quality system regulation violations are reasonably related will not be approved until the violations have been corrected. The Company has already submitted several responses to the 2024 Form 483s issued to each of the three manufacturing facilities to the FDA and has submitted aseveral written responseupdates to the warning2024 letterWarning inLetter the first quarter ofthroughout 2025.

On March 7, 2019, TEI Biosciences, Inc. (“TEI”), one of our wholly-owned subsidiaries, received a Warning Letter (the “2019 Warning Letter”), dated March 6, 2019, from the FDA. The 2019 Warning Letter was related to quality systems issues at TEI’s manufacturing facility located in Boston, Massachusetts (the “Boston facility”). The Boston facility manufacturesmanufactured extracellular bovine matrix products in our TT segment that arewere sold both in wound reconstruction and care and surgical reconstruction franchises, and in private label channels. The letter2019 Warning Letter resulted from an inspection held at thatthe Boston facility in October and November 2018 and did not identify any new observations that were not already provided in the Form 483 that followed the inspection. We submitted our initial response to the 2019 Warning Letter on March 28, 2019 and provide regular progress reports to the FDA as to itsour corrective actions. On October 28, 2021, the FDA initiated an inspection of the Boston facility and at the conclusion of the inspection, issued an FDA Form 483 on November 12, 2021 (the “2021 Form 483”). We provided an initial response to the inspection observations. On March 1, 2023, the FDA commenced an inspection of the Boston facility and issued an FDA Form 483 at the conclusion of this inspection (the “2023 Form 483”). In May 2023, after consultation with the FDA, Thethe Company initiated a voluntary global recall of all products manufactured at the Boston facility, including PriMatrix®,PriMatrix, SurgiMend®,SurgiMend, Revize™, and TissueMend™, distributed between March 1, 2018 and May 22, 2023.2023 (the “Boston recall”). On July 19, 2023, TEI received a Warning Letter, dated July 17, 2023, from the FDA related to quality system issues at the Boston facility (the “2023 Warning Letter”). The 2023 Warning Letter did not identify any new observations that had not already been provided in the 2023 Form 483. The Company has submitted periodic responses to the FDA for both the 2023 Form 483 and the 2023 Warning Letter. We are committed to resolving the matters identified in the Warningwarning Lettersletters and Form 483s and are continuing our significant efforts to remediate the observations.

Although the Warning Letters do not restrict the Company’s ability to seek FDA 510(k) clearance of products, PMAs for Class III devices to which the quality system regulation violations are reasonably related will not be approved until the violations have been addressed. We cannot give any assurances that the FDA will be satisfied with our response to the issues identified by the FDA in any of the foregoing Form 483s or warning letters or as to the expected date of the resolution of such issues. Until the issues cited by the FDA are resolved to the FDA’s satisfaction, the FDA may initiate additional regulatory action without further notice. Any adverse regulatory action, depending on its magnitude, may restrict us from effectively manufacturing, marketing and selling our products and could have a material adverse effect on our business, financial condition and results of operations.

Durepair® Acquisition

On October 2, 2024, the Company completed the acquisition of the product rights for the Durepair® Regeneration Matrix (“Durepair”), a non-synthetic dura substitute for repair of the dura mater during neurosurgical procedures manufactured in our Boston facility and sold under a private label arrangement,procedures, from Medtronic plc for total cash consideration of $45.0 million. The Company made a cash payment of $10.0 million upon the closing of the acquisition andin willOctober make additional cash payments of2024, $15.0 million uponon the first anniversary of the acquisition in October 2025, and will make an additional cash payment of $20.0 million upon the second anniversary of the acquisition.acquisition in October 2026. The Companyadditional accountedcash forpayment theto acquisitionbe ofmade thein productOctober rights2026 foris Durepair,included whichat consistits ofpresent certainvalue patentsin andaccrued trademarks, regulatory approvals,expenses and other records,current liabilities as an asset acquisition in accordance with FASB Topic 805, Business Combinations (“ASC 805”) because the acquisition does not include an assembled workforce and substantially all of theDecember fair31, value of the assets acquired is concentrated in a single identifiable intangible asset. Durepair will be reported within Integra’s Codman Specialty Surgical segment.2025.

Acclarent, Inc. Acquisition

On April 1, 2024, the Company completed the acquisition of all of the outstanding capital stock of Acclarent, Inc. (“Acclarent”), a developer and marketer of medical devices used in ear, nose, throat (“ENT”) procedures, from Ethicon, Inc., a subsidiary of Johnson & Johnson, for approximately $282.0 million in cash, subject to customary adjustments set forth in the purchase agreement related to working capital balances transferred to the Company. TheIn the second half of 2024, the Company finalized and settled the working capital adjustment in the amount of $4.2 million, which resulted in a reduction to goodwill,goodwill inand Septemberalso 2024recognized a measurement period adjustment to recognize deferred tax liabilities of $1.1 million with a corresponding increase to goodwill as a result of a change to the estimated deferred tax rate applied and the adjustmentbook-to-tax wasdifference settledassociated duringwith thefixed threeassets months ended December 31, 2024. The addition of Acclarent’s ENT product portfolio, including sinus balloon dilation, eustachian tube balloon dilation, and surgical navigation systems technologies, and dedicated salesforce will enhance the Company’s position in the ENT specialty device market. Acclarent sales are reported within Integra’s Codman Specialty Surgical segment.acquired.

Net loss for the year ended December 31, 20242025 was $(516.5) million, or $(6.74) per diluted share, compared to a net loss of $(6.9) million, or $(0.09) per diluted share, compared to net income of $67.7 million, or $0.84 per diluted share for the year ended December 31, 2023.2024. The decrease in net incomeloss increased for the year ended December 31, 2024,2025 wasas compared to prior periods, primarily driven by impactsthe fromimpact quality and operational issues, along with costs related toof the Acclarentgoodwill acquisition.impairment of $511.4 million recorded in the second quarter of the current year.

(1) SeeThis includes adjustments for contingent consideration liabilities. Refer to Note 4.15. AcquisitionsCommitments and DivestituresContingencies of the Notes to Consolidated Financial Statements (Part IV, Item 15 of this Annual Report on Form 10-K) for details..

(2) This primarily includes idle capacity charges, inventory write offs, site transfer costs, quality remediation costs, right of use and fixed asset impairments.

We typically define special charges as items for which the amounts and/or timing of such expenses may vary significantly from period to period, depending upon our acquisition, divestiture, integration and restructuring activities,activities; anditems for which the amounts are non-cash in nature; and items which are not expected to recur at the same magnitude. We believe that given our ongoing strategy of seeking acquisitions, our continuing focus on rationalizing our existing manufacturing and distribution infrastructure and our continuing review of various product lines in relation to our current business strategy, some of the special charges discussed above could recur with similar materiality in the future.

OurThe Company’s revenues and gross margin on product revenues were as follows:

Revenues and Gross Margin

We have made statements in this Quarterly Report that constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”). All statements other than statements of historical fact contained in this Quarterly Report, including, but not limited to, statements regarding our future business, operational and financial performance and the Company’s expectations and plans with respect to market opportunity, business and operational performance, strategic initiatives, capabilities, resources, manufacturing capabilities, product development, product availability and regulatory approvals, including our plansplans, toproduction operationalizecapability, and anticipated operational timelines for the Company’s manufacturing facility in Braintree, Massachusetts (“the Braintree facility”), our expectations regarding the Compliance Master Plan (“the CMP”) implementation, engagement and efficacy, our restructuring and cost-saving initiatives, our intellectual property rights, litigation and tax matters, governmental proceedings and investigations, mergers and acquisitions, divestitures, market acceptance of our products and services, accounting estimates, financing activities, ongoing contractual obligations and compliance with restrictive and financial covenants of our outstanding indebtedness, working capital adequacy, value of our investments, our effective tax rate, estimates regarding the impact of tariffs adopted or implemented by the U.S. or other countries on our business, tariff refunds, anticipated impact of the flooding event at our Cincinnati, Ohio manufacturing facility, financial condition and results of operations, our expected returns to shareholders, and our sales efforts, are forward-looking statements. In some cases, these forward-looking statements may be identified by forward-looking words such as “believe,” “may,” “might,” “could,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “seek,” “plan,” “expect,” “should,” “would” or the negative version of these words or other similar words and expressions in this Quarterly Report.

These forward-looking statements are subject to a number of risks, uncertainties and assumptions about the Company and other matters that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. We believe these risks include but are not limited to those described under the headings “Risk Factors” and “Special Note Regarding Forward-Looking Statements” in our Annual Report on Form 10-K for the year ended December 31, 2025 and in this Quarterly Report, as such factors may be updated from time to time in our periodic filings with the Securities and Exchange Commission (the “SEC”), which are accessible on the SEC’s website at https://www.sec.gov. Such risks and uncertainties include, but are not limited, to the following: increased geopolitical tension, instability and other macroeconomic factors, including trade barriers and related restrictions (including tariffs and related countermeasures), armed conflict and acts of terrorism, supply chain disruptions, and interest rate and foreign currency rate fluctuations on the Company’s suppliers, vendors and customers and on the Company’s business and financial condition, results of operations and cash flows; the Company's ability to execute its financial, strategic and operating plans effectively; the Company’s ability to remediate quality systems violations; difficulties in implementing the CMP; difficulties or delays in obtaining and maintaining required regulatory approvals, including the costs thereof; potential difficulties, delays and disruptions in manufacturing, distribution or sale of products; the Company's ongoing assessment of the flooding event at its Cincinnati, Ohio manufacturing facility, related financial impacts, recovery efforts, potential asset impairments, unforeseen costs and insurance recoveries; the failure of the company’sCompany’s suppliers, vendors, and other third parties to meet contractual, regulatory and other obligations; the anticipated development of markets the Company sells its products into and the success of the Company’s products in these markets; the Company’s ability to predict accurately the demand for its products and products under development; increasing industry competition; the coverage and reimbursement decisions of third-party payors; trends toward health care cost containment; difficulties in controlling expenses, including costs to procure and manufacture the Company’s products; the ability of the Company to successfully manage leadership and organizational changes and the impact of changes in management or staff levels; the impact of goodwill and intangible asset impairment charges if future operating results of acquired businesses are significantly less than the results anticipated at the time of the acquisitions; the geographic distribution of where the Company generates its taxable income; changes to applicable laws, regulations and enforcement guidance, including tax laws and global health care reforms; fluctuations in foreign currency exchange rates; the amount of our bank borrowings outstanding and other factors influencing liquidity; breaches, failures or other disruptions of our or our vendors’ or customers’ information technology systems or products; and the potential impact of our compliance with governmental regulations and accounting guidance.

Integra LifeSciences Holdings Corporation is a global medical technology company dedicated to restoring lives. We are advancing transformational care through impactful innovation and our portfolio of highly differentiated technologies is trusted by healthcare professionals to deliver transformative care.professionals.

Neurosurgery: In neurosurgery, we are a global leader in neuro-access, neuro-surgical and neuro-monitoring technologies. Our product portfolio represents a continuum of care from pre-operative, to the neurosurgery operating room, to the neuro-critical care unit and post care for both adult and pediatric patients suffering from brain tumors, brain injury, cerebrospinal fluid pressure complications and other neurological conditions. This portfolio features leading brands such as Codman,Codman®, Duraseal,Duraseal®, CUSA,CUSA®, Mayfield® and Duragen.Duragen®.

ENT Solutions: We provide technologies and instruments that support a broad range of ear, nose and throat procedures, including navigation, balloon sinuplasty, airway and eustachian tube dilation applications. The Company’s ENT portfolio comprises a broad range of products including the TruDi® Navigation System featuring navigated surgical instrumentation, the RELIEVA SPINPLUS® Balloon Sinuplasty System, the AERA® Eustachian Tube Dilation System, and the MicroFrance ENT instrumentation line.

Our Tissue Reconstruction segment develops and markets a broad portfolio of regenerative tissue products and technologies primarily focused on wound reconstruction and care and private label. This segment serves a diverse range of specialties, including plastic and reconstructive surgery, general surgery, and wound management.

Wound Reconstruction Solutions: We currently utilize five unique regenerative technology platforms consisting of highly engineered bovine collagen (derived from bovine sources for structural support), bovine dermis (acellular dermal tissue for natural integration), porcine urinary bladder (extracellular matrix for cellular repopulation), human amniotic tissue (allografts as a wound cover), and resorbable synthetic mesh (biodegradable materials for temporary reinforcement). These technologies address clinical needs in treating acute wounds such as burns, chronic wounds including diabetic foot ulcers, and surgical tissue repair applications such as hernia reinforcement, tendon protection, and peripheral nerve repair. The goal is to support the body’s wound healing process by providing scaffolds that create a wound environment that facilitates cellular invasion and revascularization. These products are often used in hospital settings, wound care clinics, or outpatient procedures.

Private Label: We offer extensive expertise in collagen biomaterials for other medical technology companies that sell to end markets primarily in spine, surgical and wound care. We manufacture a broad set of our regenerativetissue and wound care technologies that are available for private label distribution by our customers, produce raw materials that can be integrated into our customers’ production processes, and have the expertise to design, develop and manufacture products to meet the specific needs of our customers.

An important part of Integra’s growth strategy is introducing new products to strengthen and expand our portfolio through clinical evidence to support regulatory approval and strong reimbursement of our product portfolio around the world, including new indications for existing technologies. Our research and development activities focus on identifying unmet surgical needs and addressing those needs with innovative solutions and products. Investment in research and development is critical to driving our future growth. Our research and development efforts are focused on the further development and improvement of our existing products, the design and development of new innovative medical technologiestechnologies, and regulatory compliance across all our business segments. We apply our core competency in regenerativetissue technologyreconstruction to innovate products for neurosurgical, wound applications, plastic surgery, and reconstructive surgery and we have extensive R&D development programs for our core platforms of electromechanical technologies.

Additionally, we conduct projects and clinical studies to generate efficacyeffectiveness and health economic evidence. The Company has continued its investments in clinical education as a key value driver to leverage its global footprint, enhanced digital content, and strengthened its clinical network. As part of this objective, the Company remains committed to participation in clinical research demonstrating the efficacyeffectiveness of its products prior to market introduction, and in supporting the clinical education and technical training.

In July 2025, we announced the inaugural enrollment of the first patient in the AERA Pediatric Registry, a prospective, multi-center observational registry evaluating the real-world use of the AERA Eustachian Tube Balloon Dilation System in children. This marks the focused effort to measure the ongoing,ongoing clinical performance of AERA in pediatric patients with obstructive Eustachian tube dysfunction. The registry is designed to capture both safety and efficacy outcomes for up to 300 pediatric patients who undergo Eustachian tube balloon dilation using AERA.

In September 2025, the Mayfield® Ghost Base Unit Post launched in the U.S., which is designed to help provide clear visualization of anatomical structure and to support surgical accuracy and patient positioning. Throughout the first half of 2026, we introduced the Mayfield Ghost Base Unit Post to markets in Europe, Asia, Australia, and New Zealand.

RegenerativeTissue Products and Technologies. Our regenerativetissue technology development program applies our expertise in bioengineering to a range of biomaterials including natural materials such as purified collagen, intact human or animal tissues, honey as well as resorbable synthetic polymers with our DuraSorb and DuraSeal® product lines. These unique product designs are used for neurosurgical and reconstructive surgical applications, as well as dermal regeneration. Our regenerativetissue technology platform includes our legacy Integra® Dermal Regeneration Template (“IDRT”) products and complementary technologies that we have acquired. Our collagen manufacturing capability, combined with our history of innovation, provides us with strong platform technologies for multiple indications.

In the third quarter of 2021, we filed a PMA application for a specific indication for SurgiMend® in the use of post-mastectomy breast reconstruction and in July 2024 received approvable pending GMP status from FDA, which approved and closed out the clinical portion of this PMA application. We currently expect the Braintree facility to be operational in June 2026, with PMA approval anticipatedfor to followSurgiMend in 2027. We are also pursuing a PMA for DuraSorb for use in implant-based breast reconstruction (“IBBR”).reconstruction. We completed enrollment for the DuraSorb U.S. investigational device exemption clinical study for two-stage breast reconstruction in June 2023;2023, completed treatment in 2024, completed patient 1-year follow up in 2025, and we continue to advance the PMA application. Currently,We we hope to secureexpect PMA approval for DuraSorb later in 2027.

In 2024, we acquired the product rights for Durepair® Dural Regeneration Matrix, a suturable dural graft which complements our portfolio of dural grafts and sealants, and subsequently launched the product for commercial sale in the U.S. in October 2025.

EUROPEAN UNION MEDICAL DEVICE (“EU MDR”) REGULATION UPDATES

On December 19, 2024, the Company received a warning letter from the FDA (the “2024 Warning Letter”). The 2024 Warning Letter relates to quality system issues identified during FDA inspections at three of the Company’s facilities located in Mansfield, Massachusetts; Plainsboro, New Jersey; and Princeton, New Jersey. The 2024 Warning Letter did not identify any new observations that had not already been provided in the Form 483s previously issued to the Company by the FDA at the conclusion of its three inspections in June and August of 2024 (the “2024 Form 483s”). In the 2024 Form 483s, the FDA deemed certain of the Company’s devices, including cranial perforators, disposable cottonoid patties and strips, and collagen-based products, to be out of compliance with respect to quality system regulations. At that time, the Company took a number of voluntary actions including the initiation of shipping holds for several products and a voluntary recall of the disposable patties and strips. The 2024 Warning Letter does not restrict the Company’s ability to manufacture or ship products, require recall of any products, nor restrict the Company’s ability to seek FDA 510(k) clearance of products. The 2024 Warning Letter states that premarket approval applications for Class III devices to which the quality system regulation violations are reasonably related will not be approved until the violations have been corrected. The Company has submitted several responses to the 2024 Form 483s issued to each of the three manufacturing facilities to the FDA and has submitted several updates to the 2024 Warning Letter throughout 2025.2025 and 2026.

On March 7, 2019, TEI Biosciences, Inc. (“TEI”), one of our wholly-ownedwholly owned subsidiaries, received a Warning Letter (the “2019 Warning Letter”), dated March 6, 2019, from the FDA. The 2019 Warning Letter was related to quality systems issues at TEI’s manufacturing facility located in Boston, Massachusetts (the “Boston facility”). The Boston facility manufactured extracellular bovine matrix products in our Tissue Reconstruction segment that were sold both in wound reconstruction and care and surgical reconstruction franchises, and in private label channels. The 2019 Warning Letter resulted from an inspection held at the Boston facility in October and November 2018 and did not identify any new observations that were not already provided in the Form 483 that followed the inspection. We submitted our initial response to the 2019 Warning Letter on March 28, 2019 and provide regular progress reports to the FDA as to our corrective actions. On October 28, 2021, the FDA initiated an inspection of the Boston facility and at the conclusion of the inspection, issued an FDA Form 483 on November 12, 2021 (the “2021 Form 483”).2021. On March 1, 2023, the FDA commenced an inspection of the Boston facility and issued an FDA Form 483 at the conclusion of this inspection (the “2023 Form 483”). In May 2023, after consultation with the FDA, the Company initiated a voluntary global recall of all products manufactured at the Boston facility, including PriMatrix, SurgiMend, Revize™, and TissueMend™, distributed between March 1, 2018 and May 22, 2023 (the “Boston recall”). On July 19, 2023, TEI received a Warning Letter, dated July 17, 2023, from the FDA related to quality system issues at the Boston facility (the “2023 Warning Letter”). The 2023 Warning Letter did not identify any new observations that had not already been provided in the 2023 Form 483. The Company has submitted periodic responses to the FDA for both the 2023 Form 483 and the 2023 Warning Letter. We are committed to resolving the matters identified in the warning letters and Form 483s and are continuing significant efforts to remediate the observations.

Although the warning letters do not restrict the Company’s ability to seek FDA 510(k) clearance of products, PMAs for Class III devices to which the quality system regulation violations are reasonably related will not be approved until the violations have been addressed. Following its assessment of the results of a third-party audit of the Boston facility, the Company announced in the second quarter of 2024 that it no longer planned to restart the manufacture of PriMatrix and SurgiMend at its Boston facility. The restart of the manufacturing of SurgiMend 510k product will occur at the Company’s new tissue manufacturing facility in Braintree, Massachusetts (the “Braintree transition”). The Company anticipates the Braintree facility to be operational in 2026. In addition, the Company entered into a new third-party agreement, which facilitated the relaunch of PriMatrix, as well as Durepair Dural Regeneration Matrix in 2025, ahead of previously disclosed timelines. The Braintree facility became operational in June 2026 and is currently ramping up production to support the planned SurgiMend relaunch in the fourth quarter of 2026.

In the fourth quarter of 2025, we approved a restructuring initiative to improve the Company’s operational performance by strengthening the stability and resilience of our supply chain, strengthening global commercial capabilities and advancing our prioritization and execution discipline. We expect to incur aggregate restructuring costs associated with this initiative of approximately $12.3 million related to severance and other employee costs. The costs will be incurred as specific actions required as part of the initiative are identified and approved and are expected to continue through the end of 2026. The amounts and timing of estimated restructuring costs are subject to change until finalized; actual amounts and timing may vary materially based on various factors. During 2025, we incurred $8.5 million of restructuring costs related to this initiative. In the firstsix quartermonths ofended June 30, 2026, we incurred an additional $3.8 million in restructuring related expenses, consistent with the previously announced plans. In addition, we incurred costs related to executive restructuring activities during the six months ended June 30, 2026, which were separate from the previously announced plans.

Net loss forFor the three and six months ended MarchJune 31,30, 20262026, net income (loss) was $4.5 million and $(4.60.1) million, or $0.06 and $(0.060.00) per diluted share, as compared to net losslosses of $(25.3484.1) million and $(509.4) million, or $(0.336.31) and $(6.65) per diluted share, for the three and six months ended MarchJune 31,30, 2025. The improvement in net income (loss decreased) for the three and six months ended MarchJune 31,30, 2026,2026 was primarily dueattributable to the reducedgoodwill impactimpairment ofcharge quality and operational issuesrecognized in the current year compared to prior period.year.

Three Months Ended MarchJune 31,30, 2026 as Compared to Three Months Ended MarchJune 31,30, 2025

For the three months ended MarchJune 31,30, 2026, total revenues increased by $9.3$3.2 million to $391.9$418.8 million from $382.7$415.6 million for the same period in 2025, representing low-single digit growth compared to the same period in the prior year.

In the Specialty Surgery segment, revenues were $283.1$309.3 million which represents an increase of $2.5$5.3 million, or 1%2% as compared to the prior-year period. Excluding the impact of foreign currency of $4.1$0.4 million, the increase in revenue is primarily driven by Neurosurgery,Neurosurgery and Surgical Instruments, offset by decreases in our Instrument and ENT Solutions business.

In the Tissue Reconstruction segment, revenues were $108.8$109.5 million which represents ana increasedecrease of $6.8$2.2 million, or 7%2% as compared to the prior-year period. ThisThe isdecline primarilywas attributable to lower sales of MicroMatrix and Integra Skin, partially offset by growth in PriMatrix and DuraSorb. The decrease in Integra Skin,Skin whichsales recoveredwas fromprimarily priordue year supply issues, Primatrix and Durasorb, offset byto the impactclearance of qualitybackorders andin operationalthe issuesprior-year associated with Medihoney.period.

Gross margin was $217.0$219.7 million for the three months ended MarchJune 31,30, 2026, an increase of $22.6$10.4 million from $194.4$209.3 million for the same period in 2025. Gross margin as a percentage of revenues was 55.4%52.5% for the three months ended MarchJune 31,30, 2026 and 50.8%50.4% for the same period in 2025. The increase in gross margin is primarily attributable to higher revenues and a reduction in costs associated with the Braintree remediation, lower costs related to quality and operational issues, and improved manufacturing performance compared to the Braintreesame remediation.period in the prior year.

Total operating expenses, which consist of research and development, selling, general and administrative, and amortization expenses, decreased by $4.4$521.5 million, or 2.1%,72.2%, to $205.5$200.5 million in the three months ended MarchJune 31,30, 2026, compared to $209.9$722.0 million in the same period in 2025.2025, mainly driven by the goodwill impairment charge in the second quarter of the prior year.

Research and development expenses for the three months ended MarchJune 31,30, 2026 decreased by $1.2$2.7 million as compared to the same period in the prior year, primarily attributable to costreduced management initiativesspending in theEU current year.MDR.

Selling, general and administrative costs for the three months ended MarchJune 31,30, 2026 decreased by $3.3$7.5 million as compared to the same period in the prior year, primarily due a reduction in Acclarent integration costs and reduced spending in EU MDR.

Amortization expense (which does not include amounts reported in cost of product revenues for technology-based intangible assets) for the three months ended MarchJune 31,30, 2026 was $3.8 millionmillion, comparedconsistent to $3.7 million forwith the same period in the prior year.

Interest income for the three months ended MarchJune 31,30, 2026 decreased by $0.3$0.4 million as compared to the same period in the prior year.

Interest expense for the three months ended MarchJune 31,30, 2026 increased by $3.7$2.0 million as compared to the same period in the prior year primarily due to higher interest rates on the borrowings under the revolving credit facility component of the Senior Credit Facility as compared to the interest rates on the 2025 Notes, which was repaid in August 2025.

Other income (expense), net for the three months ended MarchJune 31,30, 2026 changed by $4.6$6.1 million as compared to the same period in the prior year, primarily driven by higher income recognized on our cross currency swap contracts. For additional information regarding our cross-currency swap arrangements, see Note 6. Derivative Instruments.

The Company’s effective income tax rates for the three months ended MarchJune 31,30, 2026 and 2025 were (91.7)%5.5% and 15.8%,8.8%, respectively.

The effective tax rate may vary from period to period dependingdue on,to amongfactors other factors,including the geographic and business mix of taxable earnings and losses, tax planning activities, and settlements with various taxing authorities. WeThe considerCompany evaluates these factorsfactors, andtogether others,with including the Company’sits history of generating taxable earnings, inwhen assessing ourthe abilityrealizability toof realizeits tax assets on a quarterly basis.

Additionally, changes to incomein tax laws andor regulations,regulations in any of the tax jurisdictions in which the Company operates,operates could impact theits effective tax rate. VariousGovernments governments,in boththe U.S. and non-U.S.,abroad arecontinue increasinglyto focusedfocus on tax reform and revenue-raising legislation. On July 4, 20252025, the One Big Beautiful Bill Act (“OBBBA”), was enacted in the U.S., with certain provisions effective in 2025 and others implemented through 2027.U.S. The OBBBA includedincludes theseveral permanenttax extensionlaw changes, including extensions of certain expiring provisions of the 2017 Tax Cuts and Jobs Act,Act theprovisions, immediate expensing of previously capitalizedcertain research and development costs, and reducedchanges limitations onto interest expense deductions,deduction among other provisions.limitations.

Further, theThe Company continues to monitor tax legislation inenacted by foreign jurisdictions, enactedjurisdictions in response to ongoing efforts led by the Organization of Economic Cooperation and DevelopmentDevelopment's (“OECD”). The OECD released Pillar Two model rules, defining a new 15% global minimum tax framework. Pillar Two generally provides for each jurisdiction in which a 15% minimum tax on large multinational corporationcompanies operates,on a jurisdiction-by-jurisdiction basis, with certain provisions effective beginning in 2024.