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

Continuing pressures to reduce healthcare costs and inadequate coverage and reimbursement may adversely affect our prices.prices and volume. If we cannot reduce manufacturing costs of existing and new products to counteract such pricing pressures, our sales may not grow and our profitability may decline.

Disruptions at the FDA, other government agencies or notified bodies caused by funding shortages, globalpolicy health concerns,changes, or personnel turnover could hinder their ability to hire, retain, or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, cleared, approved, certified, or commercialized in a timely manner, or at all, which could negatively impact our business.

The ability of the FDA, foreign regulatory authorities and notified bodies to review and approve or certify new products can be affected by a variety of factors, including government budget and funding levels, statutory, regulatory and policy changes, a government agency's ability to hire and retain key leadership and other personnel and accept the payment of user fees, and other events that may otherwise affect the government's ability to perform routine functions. Average review times at the FDA, other government agencies, foreign regulatory authorities and notified bodies have fluctuated in recent years as a result. In addition, government funding of other government agencies that fund research and development activities is subject to the political process, which is inherently fluid and unpredictable. For example, in recent years, the U.S. government has shut down several times and certain regulatory agencies, such as the FDA, have had to furlough critical FDA employees and stop critical activities. In addition, the current U.S. Presidential administration has issued certain policies and Executive Orders directed towards reducing the employee headcount and costs associated with U.S. administrative agencies, including the FDA, and it remains unclear the degree to which these efforts may limit or otherwise adversely affect the FDA’s ability to conduct routine activities. If a prolonged government shutdown occurs, or if funding shortages, policy modifications, staffing limitations or similar factors hinder or prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, such events could significantly impact the ability of the FDA or other such regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

Our ability to execute our business strategy depends, in part, on the continued and uninterrupted performance of our information technology systems and those of our third-party service providers, strategic partners and other contractors or consultants, which support our operations. Despite the implementation of security measures, our information technology systems, and those of third parties on which we rely, are vulnerable to attack, interruption and damage from, among others, computer viruses, malware (e.g. ransomware), misconfigurations, “bugs” or other vulnerabilities, malicious code, natural disasters, terrorism, war, telecommunication and electrical failures, hacking, cyber-attacks or cyber-intrusions over the Internet, phishing and other social engineering schemes, human error, theft or misuse by persons inside our organization, or persons with access to systems inside our organization, fraud, denial or degradation of service attacks and sophisticated nation-state and nation-state-supported actors or similar disruptive problems. We have also outsourced elements of our information technology infrastructure, and as a result a number of third-party vendors may or could have access to our confidential information. The risk of a security breach or disruption, particularly through cyber-attacks or cyber-intrusion, including by computer hackers, foreign governments, and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased. Because the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently and often are not foreseeable or recognized until launched against a target, we may be unable to anticipate these techniques or to implement adequate preventative measures. We may also experience security breaches that may remain undetected for an extended period. Even if identified, we may be unable to adequately investigate or remediate incidents or breaches due to attackers increasingly using tools and techniques (including artificial intelligence) that are designed to circumvent controls, to avoid detection, and to remove or obfuscate forensic evidence. There can also be no assurance that our and our third-party service providers’, strategic partners’, contractors’, consultants’, CROs’ and collaborators’ cybersecurity risk management program and processes, including policies, controls or procedures, will be fully implemented, complied with or effective in protecting our systems, networks and Confidential Information.

If a catastrophic event occurs at or near any of our manufacturing facilities or our suppliers’ facilities, or utility providers or public health officials take certain actions (e.g., shut off power to our or our suppliers’ facilities), our operations may be interrupted, which could adversely impact our business and results of operations. TransitionTransitions impactsto ofaddress climate-related events may subject us to increased regulations, reporting requirements, standards or expectations regarding the environmental impacts of our business. Any of such adverse impacts from these or other climate-related events may also adversely affect our reputation, business, or financial performance.

The increasingevolving focusand varied views on sustainability and environmental, social and governance ("ESG") initiatives could increase our costs, harm our reputation and adversely impact our financial results.

There has been increasing public focus by investors,Investors, patients, the media, governmental and nongovernmental organizations and other stakeholders have evolving and varied views on a variety of sustainability and ESG matters. We may experience pressureconflicting pressures to make commitments relating to sustainability matters that affect us, including the design and implementation of risk mitigation strategies related to sustainability. Expectations regarding the management of ESG initiatives also continue to evolve rapidly.evolve. While we may from time to time engage in various initiatives (including but not limited to voluntary disclosures, policies or goals) to improve our ESG profile or respond to certain stakeholder expectations, we cannot guarantee that these initiatives will have the desired effect. If we are not effective in addressing the sustainability and ESG matters affecting our business, or setting and meeting relevant goals, our reputation and financial results may suffer. In addition, even if we are effective at addressing such matters, we may experience increased costs as a result of executing upon our sustainability and ESG goals that may not be offset by any benefit to our reputation,reputation. whichMoreover, if we are effective at addressing such matters, we may also attract negative attention from stakeholders and regulators with diverging views on ESG and sustainability. These outcomes could have an adverse impact on our business, operations and financial condition.

In addition, we operate in various jurisdictions that have adopted or proposed laws and regulations related to sustainability and ESG reporting. For example, we and our subsidiaries may be subject to the European Union’s Corporate Sustainability Reporting Directive,Directive ("CSRD"), which requires in scopein-scope entities to provide detailed reporting on various climate change and sustainability topics. For certain U.S. companies with subsidiaries in the EU, CSRD will become effective in 2027 through a phased approach, following the European Parliament’s approval of the Omnibus package on December 16, 2025. Similarly, California’s Climate Corporate Data Accountability Act,Act ("SB 253"), Climate-Related Financial Risk Act,Act ("SB 261"), both of which are being challenged in federal courts, and Voluntary Carbon Market Disclosures Act would respectively require third-party assurance of greenhouse gas emissions information for certain entities, climate-related financial risk reporting and disclosures regarding carbon reduction claims. TheOn SEC’sNovember climate18, disclosure2025, rule,the ifU.S. itCourt of Appeals for the Ninth Circuit granted a motion for an injunction on SB 261, enjoining the California Air Resources Board’s from enforcing SB 261, and scheduled a hearing for January 9, 2026. This decision does not impact SB 253, which is enforcedstill byin effect. The court has yet to decide post-hearing whether to issue a preliminary injunction against SB 261 and/or SB 253, and the currentcase administrationwill andreturn survivesto itsthe currentCentral federalDistrict courtof challenge,California wouldfor requirefurther newproceedings, with summary judgment briefing planned for the summer. We are assessing the necessary measures to comply with the climate-related disclosuresreporting in SEC filings and audited financial statements.requirements. We may also be subject to the International Sustainability Standards Board’s sustainability and climate disclosure standards, to the extent adopted by jurisdictions in which we operate, among other regulations or requirements. We are assessing our reporting obligations in the jurisdictions where we operate. Operating in more than one jurisdiction is likely to make our compliance with sustainability and ESG rules more complex and expensive, and potentially expose us to greater levels of legal risks associated with our compliance. Our failure to comply with any applicable rules or regulations could lead to penalties and adversely impact our reputation, customer attraction and retention, access to capital and employee retention. Such sustainability and ESG matters may also impact our suppliers and customers, which may augment or cause additional impacts on our business, financial condition, or results of operations.

We have a single manufacturing facility for our Clave products located in Salt Lake City, Utah. Our Salt Lake City facility also produces other components on which our manufacturing operations in Ensenada, Mexico and Costa Rica rely. Our IV Solutions are manufactured at our manufacturing facility in Austin, Texas or our suppliers’ facilities. We also operate various other manufacturing facilities in the U.S., Mexico, Italy and Czech Republic. In addition, the IV Solutions products that we sell and distribute on behalf of the joint venture are manufactured at a facility in Austin, Texas owned by the joint venture, in which we own a 40% equity interest. If our facilities or our suppliers' facilities are inoperable, for even a short period of time, it could adversely affect our ability to manufacture and distribute our products in a timely or cost-effective manner, and our ability to make product sales. Furthermore, our facilities and the equipment we use to perform our manufacturing processes could be unavailable or costly and time-consuming to repair or replace.

The credit agreement governing our Senior SecuredNew Credit Facilities contains, among other things, certain customary restrictive covenants that limit our ability to incur additional indebtedness and liens, merge with other companies or consummate certain changes of control, acquire other companies, make certain investments, pay dividends, enter into certain transactions with affiliates, and transfer or dispose of assets as well as financial covenants. While we have not previously breached and are not currently in breach of these or any other covenants contained in our credit agreement, our ability to comply with these covenants may be affected by events beyond our control, including health crises and global pandemics, other geopolitical events, supply chain interruptions or general economic environment, including high inflation and interest rates. These covenants could also limit our ability to seek capital through the incurrence of new indebtedness or, if we are unable to meet our obligations, require us to repay any outstanding amounts with sources of capital we may otherwise use to fund our business. As such, these restrictive covenants contained in our Senior SecuredNew Credit FacilityFacilities may restrict our ability to pursue our business strategies.

For the years ended December 31, 20242025 and 2023,2024, business from a single distributor accounted for approximately 18% and 16% of our consolidated revenues, respectively.revenues. We may rely on one or more key distributors for a product, and the loss of these distributors could reduce our revenue. Additionally, distributors may face financial difficulties, including bankruptcy, which could harm our collection of accounts receivable and financial results. Failure to manage risks related to our use of distributors may reduce sales, increase expenses, and weaken our competitive position, any of which could have a material adverse effect on our business and results of operations.

•delays in or refusal to grant our requests for future 510(k) clearances, PMA approvals or foreign regulatory approvals or certifications of new products, new intended uses, or modifications to existing products;

In addition, theThe FDA may change its clearance and approval policies, adopt additional regulations or revise existing regulations, or take other actions which may prevent or delay approval or clearance of our future products under development or otherwise increase the costs associated with compliance.

In addition, FDA and foreign regulations and guidance are often revised or reinterpreted by the FDA and foreign counterparts in ways that may significantly affect our business and our products. Any new statutes, regulations or revisions or reinterpretations of existing regulations may impose additional costs or lengthen review times of any future products or make it more difficult to obtain clearance, approval, or certification to manufacture, market or distribute our products. We cannot determine what effect changes in regulations, statutes, legal interpretation or policies, when and if promulgated, enacted or adopted may have on our business in the future. Such changes could, among other things, require: additional testing prior to obtaining clearance, approval, or certification; changes to manufacturing methods; recall, replacement or discontinuance of our products; or additional record keeping. For example, inon February 2024,2, 2026, the FDA issued aFDA’s final rule to amend and replaceimplementing the QSR,QMSR became effective. The QMSR, which replaced the FDA’s former Quality System Regulation, sets forth the FDA’s current good manufacturing practicecGMP requirements for medical devices, to align more closely with the International Organization for Standardization standards. Specifically, this final rule, which the FDA expects to go into effect on February 2, 2026, establishes the “Quality Management System Regulation,” (“QMSR”), whichand among other things, incorporates by reference certain elements of the quality management system requirements of ISO 13485:2016. Although the FDA has stated that the standards contained in ISO 13485:2016216 are substantially similar to those set forth in the QSR, and although we have obtained ISO 13485:2016 certification for our quality systemmanagement issystem, currentlythe designedFDA has indicated that ISO:13485 certification alone will not ensure compliance under the QMSR, nor will ISO certification exempt manufacturers from FDA inspection. The QMSR also includes certain compliance obligations, such as those relating to complyunique device identification, product traceability, and maintenance of complaint and service records, that align more closely with FDA’s existing medical device requirements than with ISO standardsstandards. in connection with our device certifications outside the United States,Accordingly, it isremains unclear the extent to which thisthe finalQMSR rule, once effective, couldmay impose additional or different regulatory requirements on us that could increase the costs of compliance or otherwise negatively affect our business. If we are unable to comply with QMSR, once effective,QMSR or with any other changes in the laws or regulations enforced by FDA or comparable regulatory authorities, we may be subject to enforcement action, which could have an adverse effect on our business, financial condition and results of operations.

In addition, the EU landscape concerning medical devices recently evolved. On May 26, 2021, the EU Medical Devices Regulation became applicable and repealed and replaced the EU Medical Devices Directive. Unlike directives, which must be implemented into the national laws of the EU member states, regulations are directly applicable (i.e., without the need for adoption of EU member state laws implementing them) in all EU member states and are intended to eliminate current differences in the regulation of medical devices among EU member states. In accordance with its recently extended transitional provisions, both (i) devices lawfully placed on the market pursuant to the EU Medical Devices Directive prior to May 26, 2021 and (ii) legacy devices lawfully placed on the EU market after May 26, 2021 in accordance with the EU Medical Devices Regulation transitional provisions may generally continue to be made available on the market or put into service, provided that the requirements of the transitional provisions are fulfilled as may be assessed by the notified body. However, even in this case, manufacturers must comply with a number of new or reinforced requirements set forth in the EU Medical Devices Regulation with regard to registration of economic operators and of devices, post-market surveillance, market surveillance and vigilance requirements and comply with the requirements of the notified body.

If we or our component manufacturers fail to comply with the FDA's Quality Management System Regulation or Good Manufacturing Practice regulations or other requirements, our manufacturing operations could be interrupted, and our product sales and operating results could suffer. In particular, if we are unable to resolve or close-out the Warning Letter dated October 1, 2021, received by Smiths Medical ASD, Inc. from the Minneapolis, Minnesota Facility following a February to March 2021 inspection, we could suffer significant sanctions which may impact our ability to sell products globally.

In the United States, we and some of our component manufacturers are required to comply with regulatory requirements known as the FDA's QSR,QMSR, a complex regulatory scheme which currently covers the procedures and documentation of the design, testing, production, control, quality assurance, inspection, complaint handling, recordkeeping, management review, labeling, packaging, sterilization, storage and shipping of our device products. The QSR applies to the manufacture of medical device components and finished medical devices. The FDA audits compliance with these regulatory requirements through periodic announced and unannounced inspections of manufacturing and other facilities. The FDA may conduct inspections or audits at any time, and we and some of our component suppliers are subject to such inspections. Although we believe our manufacturing facilities and those of our critical component suppliers are in compliance with the QSRQMSR requirements, and with other applicable cGMPs for our products, we cannot provide assurance that any future inspection will not result in adverse findings. For example, on October 1, 2021, Smiths Medical received a Warning Letter from the FDA following an inspection of Smiths Medical’s Minneapolis, Minnesota Facility during February to March 30, 2021. The Warning Letter cited, among other things, failures to comply with FDA's medical device reporting requirements and failures to comply with applicable portions of the QSR. There is no guarantee that we will be able to successfully resolve the issues identified in the Warning Letter or do so in a timely manner or that similar compliance issues will not be identified in a future FDA inspection. If we are unable to resolve the Warning Letter, we may be subject to the sanctions listed below.

To market our products in the EU, we must conform to additional requirements and demonstrate conformance to harmonized quality standards. A notified body would typically audit and examine a product's technical dossiers and the manufacturers'manufacturer's quality system (the notified body must presume that quality systems which implement the relevant harmonized standards – which is ISO 13485:2016 for Medical Devices Quality Management Systems – conform to these requirements). Subject to the transitional provisions, manufacturers of medical devices must also comply with the EU Medical Devices Regulation. Compliance with these requirements assure that medical devices are both safe and effective and do not compromise the clinical condition or safety of patients, or the safety and health of users and – where applicable – other persons and meet all applicable established standards prior to being marketed in the EU. There is no assurance that we will continue to meet the requirements for distribution of our products in the EU and the EEA.

Certain states have also adopted privacy and security laws and regulations, which govern the privacy, processing and protection of health-related and other personal information. Such laws and regulations will beare subject to interpretation by various courts and other governmental authorities, thus creating potentially complex compliance issues for us and our future customers and strategic partners. For example, California enacted the California Consumer Privacy Act of 2018 (the "CCPA"), as amended by the California Privacy Rights Act (collectively, the CCPA) which requires covered businesses that process the personal information of California residents to, among other things: (i) provide certain disclosures to California residents regarding the business’s collection, use, and disclosure of their personal information; (ii) receive and respond to requests from California residents to access, delete, and correct their personal information, or to opt out of certain disclosures of their personal information;, and (iii) enter into specific contractual provisions with service providers that process California resident personal information on the business’s behalf. Additional compliance investment and potential business process changes may be required. Similar laws have passed in other states, and are continuing to be proposed at the state and federal level, reflecting a trend toward more stringent privacy legislation in the U.S. The enactment of such laws could have potentially conflicting requirements that would make compliance challenging. If we fail to comply with applicable laws and regulations we could be subject to penalties or sanctions, including criminal penalties if we knowingly obtain or disclose individually identifiable health information from a covered entity in a manner that is not authorized or permitted by HIPAA or applicable state laws.

Foreign data protection laws, including the European Union General Data Protection Regulation (the "EU GDPR"), which became effective in May 2018, and the United Kingdom General Data Protection Regulation (the "UK GDPR") (the EU GDPR and EEAUK memberGDPR statetogether datareferred protectionto legislation,as the "GDPR", may also apply to health-related and other personal data obtained outside of the U.S. or in the context of our establishments outside of the U.S.. The GDPR imposes strict requirements for processing the personal data of individuals within the EEA and the UK or in the context of our activities within the EEA. The GDPR hasEEA and willthe continue to increase compliance burdens on us,UK, including by mandating potentially burdensome documentation requirements and granting certain rights to individuals to control how we collect, use, disclose, retain and process data about them. Fines for non-compliance with the GDPR are significant - the greater of €20 million/£17.5 million or 4% of global turnover. In addition to fines, a breach of the GDPR may result in regulatory investigations, reputational damage, orders to cease/ change our data processing activities, enforcement notices, assessment notices (for a compulsory audit) and/ or civil claims (including class actions). The GDPR provides that EU and EEA member states or the UK may impose further obligations relating to the processing of genetic, biometric or health data, which could limit our ability to collect, use and share personal data, or could cause our compliance costs to increase, ultimately having an adverse impact on our business. Among other requirements, the GDPR regulates transfers of personal data subject to the GDPR to third countries that have not been found to provide adequate protection to such personal data, including the United States, and the efficacy and longevity of current transfer mechanisms between the European Economic Area, or the EEA, and the United States remains uncertain. Case law from the Court of Justice of the European Union (“CJEU”) states that reliance on the standard contractual clauses - a standard form of contract approved by the European Commission as an adequate personal data transfer mechanism - alone may not necessarily be sufficient in all circumstances and that transfers must now be assessed on a case-by-case basis. On July 10, 2023, the European Commission adopted its Adequacy Decision in relation to the new EU-US Data Privacy Framework (“DPF”), rendering the DPF effective as a GDPR transfer mechanism to U.S. entities self-certified under the DPF. We expect the existing legal complexity and uncertainty regarding international personal data transfers to continue as supervisory authorities issue further guidance on personal data export mechanisms, including circumstances where the SCCs cannot be used, and/or start taking enforcement action. In particular, we expect the DPF Adequacy Decision to be challengedcontinue, and international transfers to the United States and to other jurisdictions more generally to continue to be subject to enhanced scrutiny by regulators. WeAs the regulatory guidance and enforcement landscape in relation to data transfers continue to develop, we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or if we are otherwise unable to transfer personal data between and among countries and regions in which we operate, it could affect the manner in which we provideoperate our services,business, the geographical location or segregation of our relevant systems and operations, and could adversely affect our financial results.

•the federal Physician Sunshine Act, which require certain applicable manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program ("CHIP") to report annually to the U.S. Department of Health and Human Services' CMS information related to payments and other transfers of value to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain other healthcare providers (physician assistants, nurse practitioners, clinical nurse specialists, anesthesiologist assistants, certified registered nurse anesthetists, anesthesiology assistants and certified nurse midwives, and teaching hospitals), and applicable manufacturers and GPOs, to report annually ownership and investment interests held by physicians and their immediate family members;

Our profitability and operations are subject to risks relating to changes in government and private reimbursement programs and policies and changes in legal requirements in the U.S. and in the world. There have been, and we expect there will continue to be, a number of legislative and regulatory changes to the healthcare system that could affect our future revenues and profitability in the U.S. and abroad. Federal and state lawmakers regularly propose and, at times, enact legislation that results in significant changes to the healthcare system, some of which are intended to contain or reduce the costs of medical products and services. For example, in 2010, the ACA was signed into law introducing comprehensive health insurance and healthcare reforms in the U.S. The ACA, among other things, provided incentives to programs that increase the federal government's comparative effectiveness research, and implemented payment system reforms including a national pilot program on payment bundling to encourage hospitals, physicians and other providers to improve the coordination, quality and efficiency of certain healthcare services through bundled payment models. Additionally, the ACA has expanded eligibility criteria for Medicaid programs and created a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research. Since its enactment, there have been judicial, executive and Congressional challenges to certain aspects of the ACA. On June 17, 2021, the U.S. Supreme Court dismissed the most recent judicial challenge to the ACA brought by several states without specifically ruling on the constitutionality of the ACA.

On December 13, 2021, Regulation No 2021/2282 on Health Technology Assessment (“HTA”) amending Directive 2011/24/EU, was adopted. While theThe Regulation entered into force in January 2022,2022 itand onlyhas beganbeen toapplicable apply fromsince January 2025 onwards,2025, with preparatory and implementation-related steps that took place in the interim. Once applicable, it will have a phased implementation dependingbased on the concernedtype products.of product i.e., certain high-risk medical devices as of 2026. The Regulation intends to boost cooperation among EU member states in assessing health technologies, including certain high-risk medical devices, and provide the basis for cooperation at the EU level for joint clinical assessments in these areas. It will permit EU member states to use common HTA tools, methodologies, and procedures across the EU, working together in four main areas, including joint clinical assessment of the innovative health technologies with the highest potential impact for patients, joint scientific consultations whereby developers can seek advice from HTA authorities, identification of emerging health technologies to identify promising technologies early, and continuing voluntary cooperation in other areas. Individual EU member states will continue to be responsible for assessing non-clinical (e.g., economic, social, ethical) aspects of health technology, and making decisions on pricing and reimbursement.

The FDA and foreign regulatory bodies have the authority to require the recall of commercialized products in the event of material deficiencies or defects in design or manufacture of a product or in the event that a product poses an unacceptable risk to health. The FDA’s authority to require a recall must be based on a finding that there is reasonable probability that the device could cause serious injury or death. We may also choose to voluntarily recall a product if any material deficiency is found. A government-mandated or voluntary recall by us could occur as a result of an unacceptable risk to health, component failures, malfunctions, manufacturing defects, labeling or design deficiencies, packaging defects or other deficiencies or failures to comply with applicable regulations. Product defects or other errors may occur in the future. For example, in June 2024, Smiths Medical ASD initiated Class 1 recalls with respect to certain tracheostomy tube kits, and, in May 2024, Smiths Medical ASD initiated Class 1 recalls for certain paraPAC plus ventilators.ventilators, and in April 2025 and February 2025, we initiated Class 1 recalls for certain CADD Solis ambulatory infusion pumps and ProPort venous access systems and catheters, respectively. We can provide no assurance that our efforts to work with the FDA to complete, and ultimately close, these product recalls, and any recalls that may occur in the future, will be accomplished in a timely manner, or at all. In addition, the costs associated with conducting and closing these or any other product recalls, including any liabilities we may incur, could have a material adverse effect on our business, financial condition and results of operations.

Significant changes in U.S. trade, tax or other policies that restrict imports or increase import tariffs for certain countries, particularly Mexico,Mexico and Costa Rica, can escalate trade wars and could have a meaningful adverse effect on our results of operations.

A significant amount of our products are manufactured outside of the U.S. In certain years, the U.S. government has initiated substantial changes in U.S. trade policy and U.S. trade agreements, including the initiation of tariffs on certain foreign goods. In response to these tariffs, certain foreign governments, including Canada, China and Mexico, have retaliated imposing tariffs on certain U.S. goods. In January 2025, the current administration issued executive orders imposing additional tariffs on imported goods from Canada, Mexico, and China and in response Canada immediately announced similar tariffs on U.S. imports. In April 2025, the U.S. announced and began implementing "Liberation Day" reciprocal tariff measures, including a 10% baseline tariff on imports from many countries and certain higher country-specific tariff rates. Further, in July 2025, the U.S. announced that the 10% baseline reciprocal tariff on imports from all countries would be raised to 15% for certain countries, including Costa Rica. Imposed tariffs and retaliatory responses to these and further trade measures could prevent or make it difficult and will be more costly for us to import goods. They could also potentially disrupt our existing supply chains and impose additional costs on our business, including, without limitation, costs with respect to raw materials upon which our business depends. The most significant potential impact to us is the additional tariffs on Costa Rican and Mexican imports, which could result in a meaningful impact to our results of operations due to our manufacturing facilities in Mexico.these countries. Increased tariffs could require us to increase our prices, which likely could decrease demand for our products, and in certainmany cases we may be unable to pass along increased costs to our customers if they are under long-term fixed price contracts. Additionally, we are subject to income taxes in the U.S. and numerous foreign jurisdictions. Any significant changes in current tax policies could have a material adverse effect on our results of operations.

We face exposure to adverse movements in foreign currency exchange rates due to our operations in foreign markets through our foreign subsidiaries and other international distributors. Our primary foreign currency exchange rate exposures are currently with the Euro, Mexican Peso, Canadian Dollar, Czech Koruna, Costa Rican Colon, Japanese Yen, Chinese Renminbi, and the Australian Dollar against the U.S. dollar. Our income and expenses are based on a mix of currencies, and a decline in one currency relative to the other currencies could adversely affect our operating results. Furthermore, our operating results are reported in U.S. dollars, using the exchange rate in effect at the balance sheet date, or, for revenues and expenses, using the average monthly exchange rates during the year. Accordingly, our operating results have been and continue to be subject to volatility due to fluctuations in foreign currency exchange rates. Generally, when the U.S. dollar weakens against these currencies, the dollar value of foreign-currency denominated revenue and expense increases, and when the U.S. dollar strengthens against these currencies, the dollar value of foreign-currency denominated revenue and expense decreases. We are also exposed to foreign currency risk on outstanding foreign currency denominated receivables and payables. Currency exchange rates have been especially volatile in the recent past. Accordingly, changes in foreign currency exchange rates have adversely affected and may continue to adversely affect our results of operations. DuringFor 2024,example, during 2025, we recorded $9.8$3.8 million in foreign exchange lossesgains, duenet primarily related to the volatility of foreign exchange rates later in the year such as the strengtheningweakening of the USU.S. dollar relative to most of our selling currencies incertain foreign jurisdictionscurrencies, whichincluding impactedthe marginsEuro and British Pound, partially offset by the devaluationweakening of the ArgentineU.S. dollar relative to the Mexican Peso. See Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for a further discussion of the financial impact of exchange rate fluctuations on our results of operations. Fluctuations in currency exchange rates are caused by a number of factors that are beyond our control, including a country’s political and economic policies, inflationary conditions, disruptions in the financial markets, and global economic and geopolitical conditions.

We are dependent on manufacturing in Mexico,Mexico and could be adversely affected by that region's increased labor costs and any economic, social or political disruptions.

The Smiths Medical acquisition completed in January 2022 has resulted in organizational changes and an increase in size to our business. If we fail to effectively complete the integration of our businessacquired businesses in a manner that preserves our reputation with customers and the key aspects of our corporate culture, our business, financial condition and results of operations could be harmed.

The Smiths Medical acquisition was a significant acquisition for us and the product offerings within Smiths Medical are not product offerings that we previously offered. The success of our business will depend, in part, on our ability to realize our anticipated benefits, opportunities and synergies from combining our legacy businesses and Smiths Medical. We can provide no assurance that the anticipated benefits of the Smiths Medical acquisition will be fully realized in the time frame anticipated or at all. Integrating the operations of Smiths Medical with that of our legacy business has been and continues to be a complex, costly and time-consuming process. For example, we continue to execute several integration initiatives, including remaining enterprise systems conversions, manufacturing plant consolidation efforts and supply chain integration projects. The integration process may disrupt the businesses and, if implemented ineffectively, would restrict the realization of the full expected benefits. The failure to meet the challenges involved in integrating the two businesses could cause an interruption of, or a loss of momentum in, the activities of the combined businesses and could adversely affect the results of operations of the combined businesses. Potential difficulties that may be encountered in the integration process include the following:

We may expand our product offerings through acquisitions of companies or product lines from time to time. We can provide no assurance that we will be able to identify, acquire, develop or profitably manage additional companies or operations or successfully integrate such companies or operations into our existing operations without substantial costs, delays or other challenges. In 2022, we acquired the Smiths Medical business, which includes syringe and ambulatory infusion devices, vascular access, and vital care products, but we have made and continue to make significant integration efforts to achieve the anticipated benefits. See “The Smiths Medical acquisition completed in January 2022 has resulted in organizational changes and significantan growthincrease in size to our business. If we fail to effectively managecomplete thisthe growthintegration and change toof our business in a manner that preserves our reputation with customers and the key aspects of our corporate culture, our business, financial condition and results of operations could be harmed.”

For the Smiths Medical acquisition, we used a significant portion of our cash on hand and incurred a substantial amount of debt to finance the cash consideration portion and certain other amounts paid in connection with the Smiths Medical acquisition, which could adversely affect our business, including by restricting our ability to engage in additional transactions or incur additional indebtedness.

At December 31, 2024 and 2023, we had $308.6 million and $254.7 million of cash, cash equivalents and investment securities on hand, respectively, which was significantly less in each case than the balances maintained prior to the Smiths Medical acquisition. Although our management believes that we continue to have sufficient access to cash to meet our business objectives and capital needs, we currently have a decreased availability of cash, cash equivalents and investment securities and expect to continue to have such decreased availability of cash for the foreseeable future which could constrain our ability to grow our business. Furthermore, inIn connection with the Smiths Medical transaction and the payment of the cash consideration,transaction, we entered into Seniorour SecuredExisting Credit FacilitiesAgreement with Wells Fargo Bank and certain other financial institutions to refinance the Term Loan A and the existing Revolving Credit Facility under the Credit Agreement dated as of January 6, 2022 (as amended by Amendment No. 1, dated as of October 5, 2022, the "Senior SecuredExisting Credit FacilitiesAgreement," and as further amended by the Amendment, the "Amended Credit Agreement"), ofwhich $2.2resulted billionin consistingus ofincurring additional borrowing costs. In October 31, 2025, we amended our Existing Credit Agreement to refinance our existing Term Loan A and Revolving Credit Facilities. The amended credit facility includes a new five-year term loan A facility of $850.0 million, a term loan B facility of $850.0$750.0 million (the "Term Loan A"), and a new five-year revolving credit facility of $500.0 million.million (the "Revolving Credit Facility"). The proceeds from the new Term Loan A were primarily used by the lenders to (i) directly repay in full the $559.7 million of outstanding principal of the existing Term Loan A and (ii) directly repay $190.0 million of the outstanding balance of the Term Loan B under the Existing Credit Agreement. As a result of entering into the Senioramended Securedcredit Credit Facilities,facility, we incurred additional borrowing costs. At December 31, 2024,2025, our long-term debt outstanding was $1.6$1.3 billion. Our more leveraged financial position following the Smiths Medical transaction could make us more vulnerable to general economic downturns and industry conditions, and place us at a competitive disadvantage relative to our competitors. In the event that we do not have adequate capital to maintain or develop our business and need to seek additional financing, additional capital may not be available to us on a timely basis, on favorable terms, or at all. Moreover, our Senior SecuredNew Credit Facilities (defined below) have certain restrictions that may limit how we operate our business, including our ability to engage in certain transactions and incur additional indebtedness, and our business may be materially and adversely affected if these restrictions prevent us from implementing our business plan. See “Business and Operating Risks - The agreements governing our debt contain a number of restrictive covenants which limit our flexibility in operating our business, finance future operations or pursue our business strategies.”

More recently, in November 2024, we entered into a purchase agreement (the “Agreement”) with Otsuka to form a joint venture (the “Jointjoint Ventureventure”) for our IV Solutions product line. WithIn May 2025, we announced the completion of our joint venture and the formation of ICU Medical, Pearl LLC (n/k/a Otsuka expectedICU toMedical haveLLC) awith Otsuka having 60% equity interest, weand willus bebeing a minority holder with a 40% equity interest. The failure to complete this transaction or, if completed, for the Jointjoint Ventureventure to meet our performance and financial expectations could adversely impact our ability to meet internal forecasts and expectations. Additionally, pursuant to the terms of the Agreement, we willdo not have sole decision-making authority with matters related to the Jointjoint Venture,venture, or have the ability exertto control over the actions of Otsuka, which could result in impasses on decisions or decisions made by our partners, which we may be unable to resolve in a manner that will be favorable to us. Further, Otsuka may have economic or business interests that are, or may become, inconsistent with our interests.

We develop, manufacture, and sell innovative medical products used in infusion systems, infusion consumables and high-value critical care products used in hospital, alternate site and home care settings. Our team is focused on providing quality, innovation and value to our clinical customers worldwide. Our product portfolio includes ambulatory, syringe, and large volume IV pumps and safety software; dedicated and non-dedicated IV sets, needlefree IV connectors, and peripheral IV catheters, and sterile IV solutionscatheters; closed system transfer devices and pharmacy compounding systems; as well as a range of respiratory, anesthesia, patient monitoring, and temperature management products. We also offer IV Solutions products through a commercial relationship with the joint venture.

WeIn recent years, we have experiencedexperienced, and may continue to experienceexperience, significant impacts to our business as a result of global economic challenges, resulting from, among other events, health pandemics and geopolitical conflicts. These impacts,conflicts which negativelyhave impactedresulted ourin grossfluctuating profitinflation margin during 2023 and 2022, include the impact of rising inflation,rates, especially with respect to freight costs driven by higher fuel prices, increased cost and shortages of raw materials, and supply chain disruptions.disruptions, Whilehigher weinterest expectrates, the pressurevolatility on theforeign supplycurrency chainexchange to lessenrates, and inflation to continue to subside, freight costs aredriven expectedby tohigher remainfuel subject to volatility in the market.prices.

There are no significant seasonal aspects to our business. We can experience fluctuations in net sales as a result of variations in the ordering patterns of our largest customers, which may be driven more by production scheduling and customer inventory levels,levels and production scheduling, and less by seasonality. Our expenses often do not fluctuate in the same manner as net sales, which may cause fluctuations in operating income that are disproportionate to fluctuations in our revenue.

Infusion Systems revenue increased in 2023,2025, as compared to 2022,2024, primarily due to higherincreased sales of ourLVP syringe pumpshardware and LVP dedicated sets.

During the third quarter of 2024, a competitor’s U.S. IV solutions manufacturing facility was damaged as a result of Hurricane Helene causing a national shortage of IV solutions. In response, we actively increased production of our IV Solutions product lines in anticipation of increased demand due to the temporary market shortage. We experienced increased demand for our IV Solutions product lines in the fourth quarter of 2024 and may continue to see elevated demand in the near term given the sustained market shortage until conditions normalize.2024.

In 2024,2025, 20232024 and 2022,2023, interest expense primarily includes the contractual interest incurred on borrowings under the Credit Agreement, as defined below, the per annum commitment fee charged on the available amount of the revolving credit facility contained in the Credit Agreement, the amortization of debt issuance costs incurred in connection with entering into the Credit Agreement (see Note 1312: Long-Term Obligations in our accompanying consolidated financial statements) offset by the impact of the interest rate swaps (see Note 98: Derivatives and Hedging in our accompanying consolidated financial statements). Theand interest expense increased in 2024, as compared to 2023, primarily due to amortization of certain swaps. The interest expense increased in 2023, as compared to 2022, primarily due to increases in the applicable SOFR reference rate.income.

The foreign exchange lossesgains, net in 20242025 were primarily related to the strengtheningweakening of the U.S. dollar relative to certain foreign currencies, including the Mexican pesoEuro and ArgentineBritish peso.Pound, Thepartially foreignoffset exchangeby lossesthe inweakening 2023of werethe primarilyU.S. relateddollar relative to the devaluationMexican of the Argentine peso during the fourth quarter of 2023.Peso.

In 2024, other miscellaneous (expense) income, net primarily includes $2.6 million in fees associated with our accounts receivable purchase program with BMO Bank N.A. ("BMO") (see Note: 18 Accounts Receivable Purchase Program). In 2023, other miscellaneous (expense) income, net primarily includes $3.7 million in fees related to our accounts receivable purchase program (see Note 1816: Accounts Receivable Purchase Program) mostly offset by a business interruption gain recognized upon receipt of insurance proceeds. We received total insurance recoveries for property damage and business interruption of $3.1 million, $2.6 million of which was related to insurance proceeds for business interruption included within other miscellaneous (expense) income, net.

Income taxes were accrued at an estimated annual effective tax rate of 56%, (78)%,% and 62% and 35% in 2024,2025, 20232024 and 2022,2023, respectively.

The effective tax rate in 2023 differs from the federal statutory rate of 21% principally because of the effect of the mix of U.S. and foreign income, state income taxes, section 162(m) excess compensation, foreign-derived intangible income (“FDII”),FDII, and tax credits. The effective tax rate in 2023 included a tax benefit of $9.6 million primarily related to unrecognized tax benefits released as a result of the expiration of the statute of limitations. The effective tax rate for 2023 also included a tax benefit of $0.8 million related to the excess tax benefits recognized on stock option exercises and the vesting of restricted stock units during the period. Additionally, the effective tax rate for 2023 included a tax benefit of $6.5 million related to U.S. federal and state return-to-provision adjustments net of related tax reserves. The adjustments related to primarily to changes in estimates for the research and development credit and foreign tax credits. Additionally,Lastly, the effective tax rate 2023 included the tax impact of the revaluation of contingent consideration of $16.2 million.

Our current primary sources of liquidity are cash and cash equivalents andequivalents, cash flows from our operations including access to borrowing arrangements.arrangements and cash flows from our accounts receivable purchase program.

2022 Credit Facilities and Access to Capital

As discussed in Note 1312: Long-Term Obligations to our accompanying consolidated financial statements, on October 31, 2025, we enteredamended intoour theExisting Credit Agreement withto variousrefinance lendersour onexisting JanuaryTerm 6,Loan 2022A inand connectionRevolving withCredit the closing of the Smiths Medical acquisition.Facilities. The Creditamended Agreementcredit providesfacility forincludes a new five-year term loan A facility of $850.0$750.0 million (the "Term Loan A"), a seven-year term loan B facility of $850.0 million (the "Term Loan B") and a new five-year revolving credit facility of $500.0 million (the "Revolving Credit Facility") (collectively, the "Senior Secured Credit Facilities"). The proceeds from the termnew loansTerm Loan A were primarily used by the lenders to finance(i) adirectly portionrepay in full the $559.7 million of outstanding principal of the cashexisting considerationTerm forLoan A and (ii) directly repay $190.0 million of the Smithsoutstanding Medicalbalance acquisition.of the Term Loan B under the Existing Credit Agreement. The outstanding aggregate principal amount of the term loans is $1.6$1.3 billion as of December 31, 2024,2025, which includes the Term Loan A that will mature in JanuaryOctober 20272030 and the Term Loan B that will mature in January 2029. The proceeds of future borrowings under the Revolving Credit Facility, which expires in JanuaryOctober 2027,2030, may be used as a source of liquidity to support our ongoing working capital requirements and other general corporate purposes. There are no outstanding borrowings under the Revolving Credit Facility as of December 31, 2024.2025. As part of entering into the Senior Secured Credit Facilities, we were assigned issuer and Term Loan B credit ratings. At the date of issuance of this report, our issuer and Term Loan B credit ratings assigned and outlook were as follows:

The Credit Agreement contains financial covenants that pertain to the Term Loan A and the Revolving Credit Facility. Specifically, we were required to maintain a Senior Secured Leverage Ratio of no more than 4.50 to 1.00 until June 30, 2024, with a stepdown to 4.00 to 1.00 thereafter, and an Interest Coverage Ratio of no less than 3.00 to 1.00 (defined and discussed in greater detail in Note 1312: Long-Term Obligations to our accompanying consolidated financial statements). We were in compliance with these financial covenants as of December 31, 2024.2025.

In January 2023, we entered into a receivables purchase agreement with Bank of the West, which was subsequently acquired by BMO Bank, N.A. ("BMO") in February 2023. This agreement providesaccelerates forour access to capital, which we utilize on an additional source of capital; however as ofneeded December 31, 2024, we are not currently utilizing this programbasis (see Note 1816: Accounts Receivable Purchase Program).

We believe that our existing cash and cash equivalents along with cash flows expected to be generated from future operations andoperations, the funds received and accessible under the Senior SecuredNew Credit Facilities and funds received under the accounts receivable program will provide us with sufficient liquidity to finance our cash requirements for the next twelve months and the foreseeable future. In the event that we experience downturns, cyclical fluctuations in our business that are more severe or longer than anticipated, fail to achieve anticipated revenue and expense levels, or have significant unplanned cash expenditures, we may need to obtain or seek alternative sources of capital or financing, and we can provide no assurances that the terms of such capital or financing will be available to us on favorable terms, if at all. Our ability to generate cash flows from operations, issue debt or enter into other financing arrangements on acceptable terms could be adversely affected if there is a material decline in the demand for our products or in the solvency of our customers or suppliers, deterioration in our key financial ratios or credit ratings or other significantly unfavorable changes in economic conditions. See Part I. Item 1A. Risk Factors for discussion of the risks and uncertainties associated with our debt financing.

In recent years, we have experienced, and may continue to experience, significant impacts to our business as a result of global economic challenges, resulting from, among other events, health pandemics and geopolitical conflicts which have resulted in fluctuating inflation rates, especially with respect to increased cost and shortages of raw materials, supply chain disruptions, higher interest rates, volatility onin foreign currency exchange rates, and freight costs driven by higher fuel prices.

In February 2026, the Supreme Court ruled that the U.S. Administration lackslacked the authority to impose tariffs under the International Emergency Economic Powers Act ("IEEPA"); the U.S. Court of International Trade subsequently ruled that companies are entitled to seek refunds for tariffs alreadypreviously paid under that Act. We areaccount currentlyfor evaluatingpotential tariff refunds under the impactgain contingency model, recognizing recoveries in the period in which the contingency is resolved and realization is assured; during the second quarter of these2026, developments,$18.9 includingmillion theof potentialtariff forrefunds recoverywere whichrecognized couldin becost material.of However,goods thesold and $0.7 million of related interest income was recognized in interest expense, net. The ultimate outcome, timing and amount of any suchadditional potential recoveriesrefunds remain uncertain. Accordingly, no amounts have been recognized during the first quarter of 2026. In response to the Supreme Court Ruling,ruling, the Administration formally repealed the tariffs imposed under IEEPA while immediately implementing new broader tariff measures under Section 122 of the Trade Act of 1974. The Section 122 tariffs expired on July 24, 2026 and the Administration subsequently announced new tariffs under Section 301 of the Trade Act of 1974, including tariffs ranging from 10% to 12.5% on imports from certain countries. In addition, the U.S. Department of Commerce continues to evaluate imports of medical consumables and equipment under a Section 232 national security investigation, which could result in additional tariffs and/or changes to currently available exemptions such as the United States-Mexico-Canada Agreement if the imports are determined to pose a national security risk. The applicability, duration, and resulting impact of these tariff measures, including ongoing legal challenges and potential changes to tariff levels or exemptions, remain uncertain. Any new tariffs, increases to existing tariff levels, or changes to currently available exemptions could increase the cost of products we import into the U.S. and adversely affect our business, financial condition and results of operations.

Based on current geopolitical conditions we expect foreign currency exchange rates, freight costs, oil prices, interest rates, and general inflation to remain subject to volatility in the market. For example, the conflict ininvolving Iran has and could continue to significantly disrupt the global oil and gasfuel supply-demand balance, increase commodity price volatility and heighten uncertainty in regional operating conditions. DisruptionsHigher fuel prices along with disruptions to transportation routes andare expected to result in higher logistics couldcosts and affect our operating results, liquidity, and cash flows, particularly if conditions persist or escalate. In addition, because resin is a primary petroleum-based raw material for our products, sustained increases in crude oil prices directly impact our manufacturing costs. While the situation remains fluid, adverse impacts cancould continue in future periods. We will continue to monitor developments and assess potential impacts on our business and financial position.

On April 24, 2025, pursuant to a purchase agreement (the "Agreement") with Otsuka Pharmaceutical Factory America, Inc. a Delaware corporation ("OPF") (described in Note 4: Disposal of Business to our accompanying condensed consolidated financial statements), we completed the formation of ICU Medical Pearl LLC (n/k/a Otsuka ICU Medical LLC (the "joint venture")) and transferred the assets, liabilities and operations that comprise our IV Solutions product line to the joint venture. At the closing of the transaction on May 1, 2025, under the Agreement, we sold a 60% interest in the joint venture to OPF. The total sales price, inclusive of our final purchase price adjustments, was $211.2 million, of which we used $200.0 million of the proceeds from the sale to pay down a portion of our outstanding Term Loan A (as defined below) long-term debt during the second quarter of 2025.

We present income statement data in Part I, Item 1. "Financial Statements." The following table shows, for the three and six months ended MarchJune 31,30, 2026 and 2025, the percentages of each income statement caption in relation to total revenue:

There are no significant seasonal aspects to our business. We can experience fluctuations in net sales as a result of variations in the ordering patterns of our largest customers, which may be driven more by production scheduling and customer inventory levels, and less by seasonality. Our expenses often do not fluctuate in the same manner as net sales, which may cause fluctuations in operating income that are disproportionate to fluctuations in our revenue. In addition, the results of our joint venture may be affected by seasonal factors, including planned facility shutdowns, which may result in lower earnings from the joint venture during the second half of the year.

Consumables revenue increased for the three and six months ended MarchJune 31,30, 2026, as compared to the same periodperiods in the prior year,year. primarilyPrice dueincreases contributed approximately 1% to newgrowth, customerfor installationsboth the three and increasedsix demandmonths ended June 30, 2026, with the remaining revenue increase driven by higher sales volumes for our Infusion Consumables and Oncology product lines.lines of approximately $9 million and $17 million for the three and six months ended June 30, 2026, respectively.

Infusion Systems revenue increased for the three and six months ended MarchJune 31,30, 2026, as compared to the same periodperiods in the prior year, primarily duedriven toby approximately $26 million and $33 million, respectively, in increased sales volumes of LVP hardware.

Vital Care revenue decreased for the three and six months ended MarchJune 31,30, 2026, as compared to the same periodperiods in the prior year, primarily due to the sale of our IV Solutions business on May 1, 2025 (see Note 4: Disposal of Business to our accompanying condensed consolidated financial statements), aswhich wellreduced asrevenue by approximately $32 million and $127 million, respectively. The remaining decrease of approximately $3 million and $8 million, respectively, was primarily due to lower sales volumes of our Pain Management and CriticalTemperature CareManagement products.

For the three months ended March 31, 2026 and 2025, gross margins were 38.9% and 34.8%, respectively. The increase in gross margin for the three months ended MarchJune 31,30, 2026, as compared to the same period in the prior year, was primarily driven by the(i) 18.9 million or 3.4% impact from tariff refunds that were received during the second quarter of 2026 and (ii) approximately a 1.7% impact from the May 1, 2025 sale of a 60% interest ofin our lower margin IV Solutions business on May 1, 2025, a lower margin business. GrossThe marginremaining alsoincrease increasedwas asrelated ato resultintegration of price increases, lower supply chain costssynergies and thepricing realization of integration synergies.changes. These reductionsfavorable impacts were partially offset by ana increase1% inunfavorable impact from tariff expense as compared toand the prior year comparable period, due to the implementationimpact of newforeign tariffscurrency beginningexchange inrate March 2025.changes.

SG&A expenses decreased for the threesix months ended MarchJune 31,30, 2026, as compared to the same period in the prior year, primarily due to a decrease of $1.9$2.4 million in dealer feesfees, and$1.9 $1.1million in IT expenses, $1.8 million in facilities expenses, $1.5 million in loss contract amortization, which when combined with other smaller category decreases, were mostlyprimarily offset by an increase of $1.7$1.6 million in stockcompensation based compensation.costs. Dealer fees decreased primarily due to the timing of end customer sales. IT expenses decreased primarily due to lower computer maintenance costs and lower outsourced data processing costs as a result of integration synergies. Facilities expenses decreased primarily due to a decrease in rent expense as a result of the expiration and exit of certain facility leases and due to lower operating lease expense driven by a lower amortization base following ROU asset impairments. Loss contract amortization decreased due to the release of an unfavorable contract liability related to the sale of the IV Solutions business in the second quarter of 2025. Stock based compensationCompensation increased due to aan changeincrease in thecash probabilityincentive of meeting certain financial targets related to a performance equity awardcompensation and dueemployee to the adoption of a retirement policy.benefits.

R&D expenses decreasedslightly increased for the three months ended MarchJune 31,30, 2026, as compared to the same period in the prior year, primarily related to lowerhigher employment expense that support ongoing R&D projects. R&D expenses decreased for the six months ended June 30, 2026, as compared to the same period in the prior year, primarily related to organizational synergies and project reprioritization. R&D expenses for both periods presented generally included increasedinclude compensation and benefit expenses, consulting fees, production supplies, samples, travel costs, utilities and other miscellaneous administrative costs incurred in our ongoing R&D projects.

Restructuring, strategic transaction and integration expenses were $16.8$21.3 million and $16.7$38.1 million for the three and six months ended MarchJune 31,30, 20262026, respectively, as compared to $16.2 million and $32.9 million for the three and six months ended June 30, 2025, respectively.

Restructuring charges were $6.9$13.0 million and $6.8$19.9 million for the three and six months ended MarchJune 31,30, 2026, respectively, as compared to $8.2 million and $15.0 million for the three and six months ended June 30, 2025, respectively. The restructuring costs for the three and six months ended June 30, 2026 were primarily related to facility closure costs and 2025,severance respectively,costs, which included $5.8 million of non-cash impairment charges related to operating lease right-of-use assets and property, plant and equipment. The restructuring costs for the three and six months ended June 30, 2025 were primarily related to facility closure costs and severance costs. As of MarchJune 31,30, 2026, we expect to pay the majority of our outstanding restructuring charges during the next twelve months. We expect restructuring costs to decrease during the remainder of 2026.

Strategic transaction and integration expenses were $9.9$8.3 million and $9.9$18.2 million for the three and six months ended MarchJune 31,30, 20262026, respectively, as compared to $8.0 million and $17.9 million for the three and six months ended June 30, 2025, respectively. The strategic transaction and integration expenses during the three and six months ended MarchJune 31,30, 2026 and 2025 were primarily related to ongoing consulting expenses, employee costs and costs from certain facility consolidations incurred to integrate our Smiths Medical business acquired in 2022. For the three and six months ended MarchJune 31,30, 2025, transaction costs also included expenses related to the sale of 60% of our IV solutions business that was completed during the second quarter of 2025.

Interest expense, net for the three and six months ended MarchJune 31,30, 2026 and 2025 primarily included the contractual interest incurred on borrowings under the Credit Agreement, as defined below, the per annum commitment fee charged on the available amount of the revolving credit facility contained in the Credit Agreement, the amortization of debt issuance costs incurred in connection with entering into the Credit Agreement (see Note 18: Long-Term Debt in our accompanying condensed consolidated financial statements), the impact of the interest rate swaps, and interest income. Additionally, interest expense for the three months ended March 31, 2026 includes the interest accretion on an unfavorable contract loss provision.provision beginning in the second quarter of 2025.

The interest expense component decreased for the three and six months ended MarchJune 31,30, 2026, as compared to the respective prior year period,periods, primarily due to lower obligation principal balances primarily resulting from principal prepayments including the $200.0 million paydown of our Term Loan A in May 2025 using proceeds from the sale of a 60% interest of our IV Solutions business.

Other Expense,(Expense) Income, net

The following table presents other expense,(expense) income, net (in thousands):

For the three and six months ended MarchJune 31,30, 2025,2026, the foreign exchange losses were primarily related to the strengthening of the U.S. dollar relative to certain foreign currencies, including the Euro. For the three and six months ended, June 30, 2025, the foreign exchange gains were primarily related to the weakening of the U.S. dollar relative to certain foreign currencies, most notably including the British Pound in the firstsecond quarter of 2025.

For the three and six months ended MarchJune 31,30, 2026 and 2025,2026, income taxes were accrued at an estimated effective tax rate of 873%31% and (42144)%, respectively, as compared to 3% and 25% for the three and six months ended June 30, 2025, respectively.

The effective tax rate for the three and six months ended MarchJune 31,30, 2026 differs from the federal statutory rate of 21% principally because of the effect of the mix of U.S. and foreign incomes, section 162(m) excess compensation, federal and state valuation allowance, FDII, and tax credits. Additionally, the effective tax rate for the three and six months ended MarchJune 31,30, 2026 included a tax benefit of $29.2$0.9 million and $30.1 million, respectively, related to unrecognized tax benefits released as a result of the expiration of statute of limitations.

The Company regularly assesses the realizability of deferred tax assets and records a valuation allowance to reduce the deferred tax assets to the amount that is more likely than not to be realized. In assessing the realizability of our deferred tax assets, we weigh all available positive and negative evidence. This evidence includes, but is not limited to, historical earnings, scheduled reversal of taxable temporary differences, tax planning strategies and projected future taxable income. Due to the weight of objectively verifiable negative evidence, the Company recorded a change to the valuation allowance against certain U.S. federal and state deferred tax assets, resulting in a $4.2$1.5 million tax expense and $2.7 million tax benefit during the three and six months ended MarchJune 31,30, 2026.2026, respectively. The significant piece of objectively verifiable negative evidence evaluated was the recent U.S. cumulative losses. The Company's ability to use our deferred tax assets depends on the amount of taxable income in future periods.

The effective tax rate for the three and six months ended MarchJune 31,30, 2025 differs from the federal statutory rate of 21% principally because of the effect of the mix of U.S. and foreign incomes, section 162(m) excess compensation, federal and state valuation allowance, and tax credits. The effective tax rate during the three and six months ended June 30, 2025 included a tax expense of $6.1 million related to the sale of a 60% interest of our IV solutions business. Additionally, there were unrecognized tax benefits released as a result of the expiration of statute of limitations during the three and six months ended June 30, 2025 of $5.0 million.

The Company recorded ana increasechange into the valuation allowance of $6.4 million tax expense against certain U.S. federal and state deferred tax assetsassets, resulting in a $2.7 million tax benefit and $3.7 million tax expense during the three and six months ended MarchJune 31,30, 2025.2025, The significant piece of objectively verifiable negative evidence evaluated was the recent U.S. cumulative losses.respectively.

Equity in LossesEarnings of Unconsolidated Affiliates

For the three and six months ended MarchJune 31,30, 2026, we recorded equity in lossesearnings of unconsolidated affiliates of $(0.6)$3.0 million and $2.4 million, respectively, as compared to equity in earnings of unconsolidated affiliates of $2.8 million for each of the three and six months ended June 30, 2025, related to our 40% proportionate share of the losses of the joint ventureventure's financial results (see Note 4: Disposal of Business to our accompanying condensed consolidated financial statements). The joint venture's earnings are typically lower in the second half of the year due to seasonality and planned facility shutdowns.

Funds generated from operations are held in cash and cash equivalents. During the threesix months ended MarchJune 31,30, 2026, our cash and cash equivalents decreased by $19.7$9.7 million from $308.0 million at December 31, 2025 to $288.3$298.3 million at MarchJune 31,30, 2026. This decrease was in part due to $38.8principal payments in 2026, including a $45.3 million prepayment on our Term Loan B during the second quarter of 2026 and $38.9 million of tax withholding payments made during the first quarter of 2026 to settle employee equity award vests. Tax withholding payments are typically highest during the first quarter due to the timing of employee equity vesting activity. These payments represent the value of the shares withheld by the Company to satisfy employee tax obligations, which effectively reduced the total number of shares issued upon vesting and minimized shareholder dilution.

As discussed in Note 18: Long-Term Debt to our accompanying condensed consolidated financial statements, on October 31, 2025 (the "Closing Date"), we entered into an Amendment No. 2 to our Credit Agreement (the "Amendment"), whereby we refinanced our Term Loan A and our Revolving Credit Facility under our existing Credit Agreement dated as of January 6, 2022 (as amended by Amendment No. 1, dated as of October 5, 2022, the "Existing Credit Agreement" and as further amended by the Amendment, the "Amended Credit Agreement"). The Amended Credit Agreement includes new credit facilities (the "New Credit Facilities") that consists of a $750.0 million senior secured term loan A and a new $500.0 million revolving credit facility (the "New Revolving Facility"). The outstanding aggregate principal amount of the term loans is $1.3$1.2 billion as of MarchJune 31,30, 2026, which includes the Term Loan A that will mature in October 2030 and the Term Loan B that will mature in January 2029. There are no outstanding borrowings under the New Revolving Facility as of MarchJune 31,30, 2026.

The Credit Agreement contains financial covenants that pertain to the Term Loan A and the New Revolving Facility. Specifically, we were required to maintain a Secured Net Leverage Ratio of no more than 4.50 to 1.00, with a step-down to 4.00 to 1.00 starting with the quarter ending June 30, 2027 and an Interest Coverage Ratio of no less than 3.00 to 1.00 (defined and discussed in greater detail in Note 18: Long-Term Debt to our accompanying condensed consolidated financial statements). We were in compliance with these financial covenants as of MarchJune 31,30, 2026.

In January 2023, we entered into a receivables purchase agreement with Bank of the West, which was subsequently acquired by BMO Bank, N.A. ("BMO") in February 2023. The program accelerates our access to capital and may be utilized as needed. The program was not utilized during the periods presented, and there arewere no outstanding sold receivables as of MarchJune 31,30, 2026 and December 31, 2025.

As of MarchJune 31,30, 2026, therewe hasnow beenexpect nocapital material changesexpenditures to ourbe range ofapproximately $85 million to $100 million for estimated 2026 planned capital expendituresexpenditures, which is at the low end of our previously disclosed $85 million to $100 million range in our 2025 Annual Report on Form 10-K.

Our principal commitments at MarchJune 31,30, 2026 include both short and long-term future obligations.

FiscalTerm 2025Loan B Principal Pre-PaymentsPrepayments

Due to a principal pre-paymentsprepayment of $45.3 million during the second quarter of 2026 and principal prepayments in 20252025, we have no mandatory principal payments on our Term loanLoan B until 2029.

Other future capital investments include restructuring and integration expenses along with spending to support quality systems and quality compliance objectives, which includes acquired field action liabilities. As of MarchJune 31,30, 2026, there have been no material changes to our range of $60 million to $80 million for estimated 2026 other future capital investments previously disclosed in our 2025 Annual Report on Form 10-K.

Our net cash provided by operations for the threesix months ended MarchJune 31,30, 2026 was $38.9$119.1 million. The changes in operating assets and liabilities included a $20.2 million increase in accounts payable and a $6.1$4.6 million decrease in inventories. Offsetting these amounts was a $24.1$7.6 million increase in accounts receivable, a $14.3$16.5 million increase in prepaid expenses and other current assets, a $2.4$2.9 million increase in other assets, a $9.8$4.9 million decrease in accounts payable, $5.9 million decrease in accrued liabilities, and $39.5$45.3 million in net changes in income taxes, including excess tax benefits and deferred income taxes. The increase in accounts payable was due to the timing of payments. The decrease in inventory was primarily due to lowerstrong productionsales volumesvolume atof certain sites as a result of material shortages from suppliersproducts and delays in the inventory production as a result of plant transfers. The increase in accounts receivable was primarily due to the amount and timing of collections. The increase in prepaid expenses and other current assets was primarily due to an increase in deferred costs andrelated to infusion pumps sold, prepaid income taxes.taxes, and amounts due from the joint venture. The increase in other assets was due to the purchase of spare parts. The decrease in accounts payable was due to the timing of payments. The decrease in accrued liabilities was primarily due to payout of annual bonuses and operating lease payments offset by an increase in deferred revenue. The net changes in income taxes was a result of the timing of payments, recording of the current deferred provision, and valuation allowance.

Our net cash provided by operations for the threesix months ended MarchJune 31,30, 2025 was $51.3$62.5 million. The changes in operating assets and liabilities included a $22.4$16.7 million decrease in accounts receivable and a $32.1$14.4 million increase in accounts payable. Offsetting these amounts was a $8.2$29.2 million increase in inventories, a $8.5$9.2 million increase in prepaid expenses and other current assets, a $6.8$5.7 million increase in other assets, $36.3$19.8 million decrease in accrued liabilities, and $6.6$28.1 million in net changes in income taxes, including excess tax benefits and deferred income taxes. The decrease in accounts receivable was primarily due to the sale of accounts receivable as part of our accounts receivable purchase program with BMO and the amount and timing of revenues. The increase in accounts payable was due to the timing of payments. The increase in inventory was primarily to build inventory safety stock levels.levels and the impact of the capitalization of tariffs in our accounting. The increase in prepaid expenses and other current assets was primarily due to an increase in deferred costs related to infusion pumps sold and the payment of other miscellaneous prepaid invoices. The increase in other assets was due to the purchase of spare parts. The decrease in accrued liabilities was primarily due to payout of annual bonuses, accrued freight chargesbonuses and paymentsoperating oflease field service corrective action.payments. The net changes in income taxes was a result of recording the current deferred provision, the timing of payments, and valuation allowance.payments.

(2) OnIn March 6, 2026,2025, we entered intosold a definitive60% agreementownership interest in our IV Solutions business to sell certain assets that constitute a business, as defined under ASC 805, Business Combinations. We received a $2.0 million advanced deposit on the pending sale,OPF, see Note 4: Disposal of Business to our accompanying condensed consolidated financial statements.

(1) Relates to scheduled principal payments and any prepayments on the Senior Secured Credit Facilities. In March 2025, we prepaid $35.0 million on our Term Loan B. In May 2025, we used $200.0 million received from the sale of a 60% interest in our IV Solutions business to pay down a portion of our Term Loan A. In June 2026, we prepaid $45.3 million on our Term Loan B. Due to pre-paymentsprepayments in 2025,2025 and 2026, we do not have any mandatory principal payment on our Term Loan B until 2029.

(3) During the threesix months ended MarchJune 31,30, 2026, our employees surrendered 295,896296,524 shares of our common stock from vested restricted stock unit awards as consideration for approximately $38.8$38.9 million in minimum statutory withholding obligations paid on their behalf. During the threesix months ended MarchJune 31,30, 2025, our employees surrendered 58,85861,066 shares of our common stock from vested restricted stock unit awards as consideration for approximately $8.4$8.7 million in minimum statutory withholding obligations paid on their behalf.

Our common stock purchase plan, which authorizes the repurchase of up to $100.0 million of our common stock, was approved by our Board of Directors in August 2019. This plan has no expiration date. As of MarchJune 31,30, 2026, all of the $100.0 million available for purchase was remaining under the plan. We are limited on share purchases in accordance with the terms and conditions of our Credit Agreement (see Note 18: Long-Term Debt in our accompanying condensed consolidated financial statements).