AtriCure, Inc. (ATRC) 2024年10-K年度報告「NASDAQ」.pdf

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1、Table of ContentsUNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549_FORM 10-K_ ANNUAL REPORT UNDER SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended December 31,2024 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1

2、934Commission File Number 000-51470_AtriCure,Inc.(Exact name of registrant as specified in its charter)_Delaware34-1940305State or other jurisdiction ofincorporation or organization(I.R.S.EmployerIdentification Number)7555 Innovation Way,Mason,OH45040(Address of principal executive offices)(Zip Code

3、)Registrants telephone number including area code:(513)755-4100Securities Registered Pursuant to Section 12(b)of the Act:Title of each classTrading Symbol(s)Name of each exchange on which registeredCommon Stock,$.001 par valueATRCNASDAQ Global MarketSecurities Registered Pursuant to Section 12(g)of

4、the Act:None_Indicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d)of the Act.Yes No Indicate by check mark whether the regis

5、trant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 during thepreceding 12 months(or for such shorter period that the registrant was required to file such reports),and(2)has been subject to such filing requirements for the past90 days.Yes N

6、o Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of RegulationS-T(232.405 of this chapter)during the preceding 12 months(or for such shorter period that the registrant was required to submit such fi

7、les).Yes No Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,a smaller reporting company,or an emerginggrowth company.See definitions of“large accelerated filer,”“accelerated filer,”“smaller reporting company”and“emerging growth

8、company”in Rule 12b-2 of theExchange Act.Large Accelerated Filer Accelerated Filer Non-Accelerated Filer Smaller Reporting Company Emerging Growth Company If an emerging growth company,indicate by check mark if the registrant has elected not to use the extended transition period for complying with a

9、ny new or revisedfinancial accounting standards provided pursuant to Section 13(a)of the Exchange Act:Indicate by check mark whether the registrant has filed a report on and attestation to its managements assessment of the effectiveness of its internal control overfinancial reporting under Section 4

10、04(b)of the Sarbanes-Oxley Act(15 U.S.C.7262(b)by the registered public accounting firm that prepared or issued its auditreport.If securities are registered pursuant to Section 12(b)of the Act,indicate by check mark whether the financial statements of the registrant included in the filing reflectthe

11、 correction of an error to previously issued financial statements.Indicate by check mark whether any of those error corrections are restatements that are required a recovery analysis of incentive-based compensation received byany of the registrants executive officers during the relevant recovery per

12、iod pursuant to 240.10D-1(b).Indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act).Yes No The aggregate market value of the voting Common Stock held by non-affiliates of the registrant,based upon the closing sale price of the Common Stock on J

13、une 30,2024,the last business day of the registrants most recently completed second fiscal quarter as reported on the NASDAQ Global Market,was approximately$1,073.1 million.ClassOutstanding February 11,2025Common Stock,$.001 par value48,879,604_DOCUMENTS INCORPORATED BY REFERENCEItems 10,11,12,13 an

14、d 14 of Part III of this Form 10-K incorporate information by reference from the registrants definitive proxy statement to be filed with the Securitiesand Exchange Commission within 120 days after the end of the fiscal year covered by this Form 10-K.2025/5/19 12:37atrc-20241231https:/www.sec.gov/Arc

15、hives/edgar/data/1323885/000132388525000009/atrc-20241231.htm1/882025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231.htm2/88Table of ContentsTABLE OF CONTENTSPART I2ITEM 1.BUSINESS2ITEM 1A.RISK FACTORS15ITEM 1B.UNRESOLVED STAFF COMMENTS31ITEM 1

16、C.CYBERSECURITY31ITEM 2.PROPERTIES33ITEM 3.LEGAL PROCEEDINGS33ITEM 4.MINE SAFETY DISCLOSURES33PART II34ITEM 5.MARKET FOR REGISTRANTS COMMON EQUITY,RELATED STOCKHOLDER MATTERSAND ISSUER PURCHASES OF EQUITY SECURITIES34ITEM 6.RESERVED34ITEM 7.MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

17、ANDRESULTS OF OPERATIONS35ITEM 7A.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK41ITEM 8.FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA43ITEM 9.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING ANDFINANCIAL DISCLOSURE69ITEM 9A.CONTROLS AND PROCEDURES69ITEM 9B.OTHER INFORMATION71IT

18、EM 9C.DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS71PART III71ITEM 10.DIRECTORS,EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE71ITEM 11.EXECUTIVE COMPENSATION71ITEM 12.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT ANDRELATED STOCKHOLDER MATTERS72ITEM 13.CERTAIN R

19、ELATIONSHIPS AND RELATED TRANSACTIONS,AND DIRECTORINDEPENDENCE72ITEM 14.PRINCIPAL ACCOUNTANT FEES AND SERVICES72PART IV73ITEM 15.EXHIBITS AND FINANCIAL STATEMENT SCHEDULES73ITEM 16.FORM 10-K SUMMARY74SIGNATURES752025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/0001323885250

20、00009/atrc-20241231.htm3/88Table of ContentsSPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTSThis Form 10-K,including the sections titled“Managements Discussion and Analysis of Financial Condition and Results ofOperations”,“Risk Factors”and“Quantitative and Qualitative Disclosures about Market Risk”

21、contains forward-lookingstatements regarding our future performance.All forward-looking information is inherently uncertain and actual results may differmaterially from assumptions,estimates or expectations reflected or contained in the forward-looking statements as a result ofvarious factors,includ

22、ing those set forth under“Risk Factors”and elsewhere in this Form 10-K.There may be additional risks ofwhich we are not presently aware or that we currently believe are immaterial which could have an adverse impact on our business.Forward-looking statements often address our expected future business

23、,financial performance,financial condition and results ofoperations,and often contain words such as“intends,”“estimates,”“anticipates,”“hopes,”“projects,”“plans,”“expects,”“drives,”“seek,”“believes,”“see,”“focus,”“should,”“will,”“would,”“opportunity,”“outlook,”“could,”“can,”“may,”“future,”“predicts,

24、”“target,”“potential,”forecast,trend,might and similar expressions and the negative versions of thosewords,and may be identified by the context in which they are used.However,the absence of these words does not mean that astatement is not forward-looking.Forward-looking statements include,without li

25、mitation,statements that address activities,events,circumstances or developments that AtriCure expects,believes or anticipates will or may occur in the future,such as earningsestimates(including projections and guidance),other predictions of financial performance,launches by AtriCure of new products

26、,developments with competitors and market acceptance of AtriCures products.Such statements are based largely upon currentexpectations of AtriCure.Any forward-looking statement speaks only as of the date made.Reliance should not be placed onforward-looking statements because they involve known and un

27、known risks,uncertainties and other factors which may causeactual results,performance or achievements to differ materially from those expressed or implied.Forward-looking statements arebased on AtriCures expectations,experience and perception of current conditions,trends,expected future developments

28、 and otherfactors it believes are appropriate under the circumstances and are subject to numerous risks and uncertainties,many of which arebeyond AtriCures control.In other words,these statements are not guarantees of future performance and inherently involve a widerange of risks and uncertainties t

29、hat are difficult to predict.With respect to the forward-looking statements,we claim the protectionof the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.These forward-looking statements speak only as of the date of this Form 10-K.We descr

30、ibe risks and uncertainties that could cause actual resultsand events to differ materially in Risk Factors,Managements Discussion and Analysis of Financial Condition and Results ofOperations and Quantitative and Qualitative Disclosures About Market Risk(Part II,Item 7A of this Form 10-K).Readers are

31、cautioned not to place undue reliance on forward-looking statements.We undertake no obligation to publicly update or revise anyforward-looking statements to reflect new information or future events or otherwise unless required by law.WEBSITE AND SOCIAL MEDIA DISCLOSUREWe use our website()and our cor

32、porate Facebook,Instagram,YouTube,LinkedIn and X accounts aschannels of distribution of company information.The information we post through these channels may be deemed material.Accordingly,investors should monitor these channels,in addition to following our press releases,Securities and ExchangeCom

33、mission,or SEC,filings and public conference calls and webcasts.The contents of our website and social media channels arenot,however,a part of this report.TRADEMARKSWe own or have the rights to use various trademarks referred to in this Annual Report on Form 10-K,including IsolatorSynergyclamp,EPi-S

34、ense coagulation device,EnCompass clamp,AtriClip FlexV device,and cryoSPHERE probes,among others,and their respective logos.Solely for convenience,we may refer to trademarks in this Annual Report on Form 10-Kwithout the and symbols.Such references are not intended to indicate,in any way,that we will

35、 not assert,to the fullest extentpermitted by law,our rights to our trademarks.MARKET AND INDUSTRY INFORMATIONMarket data used throughout this Annual Report on Form 10-K is based on managements knowledge of the industry andgood faith estimates of management.All of managements estimates presented her

36、ein are based on industry sources,includinganalyst reports and managements knowledge.We also relied,to the extent available,upon managements review of independentindustry surveys and publications prepared by a number of sources and other publicly available information.We are responsible forall of th

37、e disclosures in this Annual Report on Form 10-K,and while we believe that each of the publications,studies and surveysused throughout this Annual Report on Form 10-K are prepared by reputable sources,we have not independently verified marketand industry data from third-party sources.2025/5/19 12:37

38、atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231.htm4/88Table of ContentsAll of the market data used in this Annual Report on Form 10-K involves a number of assumptions and limitations,and youare cautioned not to give undue weight to such estimates.While w

39、e believe the estimated market position,market opportunity andmarket size information included in this Annual Report on Form 10-K is generally reliable,such information,which in part isderived from managements estimates and beliefs,is inherently uncertain and imprecise and has not been verified by a

40、nyindependent source.Projections,assumptions and estimates of our future performance and the future performance of the industry inwhich we operate are subject to a high degree of uncertainty and risk due to a variety of factors,including those described in“Item1A.Risk Factors”of Part I of this Annua

41、l Report on Form 10-K and elsewhere in this Annual Report on Form 10-K.These andother factors could cause results to differ materially from those expressed in our estimates and beliefs and in the estimates preparedby independent parties.2025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/d

42、ata/1323885/000132388525000009/atrc-20241231.htm5/88Table of ContentsPART I(Dollar and share amounts referenced in this Part I are in thousands.)ITEM 1.BUSINESSOverviewWe are a leading innovator in treatments for atrial fibrillation(Afib),left atrial appendage(LAA)management and post-operative pain

43、management.Afib is an irregular heartbeat,or arrhythmia,which affects over 59 million people worldwide and is agrowing epidemic.It is the most common cardiac arrhythmia encountered in clinical practice and results in high utilization ofhealthcare services and significant cost burden.Patients often p

44、rogress from being in Afib intermittently(paroxysmal)to being inAfib continuously(non-paroxysmal).The continuous Afib patient population includes early persistent Afib,which lasts seven daysto 6 months,persistent Afib,which lasts 6 months to one year,and long-standing persistent Afib,which lasts lon

45、ger than one year.It is estimated that over 4 million people in the United States currently suffer from long-standing persistent Afib.Afib often occursin conjunction with other cardiovascular diseases,including hypertension,congestive heart failure,left ventricular dysfunction,coronary artery diseas

46、e and valvular disease.Our cardiac ablation and left atrial appendage management(LAAM)products are used by physicians during open-heart andminimally invasive surgical procedures.In open-heart procedures,the patient is undergoing heart surgery for other conditions,suchas a mitral or aortic valve repa

47、ir or a coronary artery bypass,and our products are used by physicians in conjunction with(“concomitant”to)such a procedure.Minimally invasive procedures are performed on a standalone basis,and often include multi-disciplinary or“hybrid”approaches,combining surgical procedures using our ablation and

48、 LAAM products with catheter ablationperformed by an electrophysiologist.Our pain management solutions are used by physicians to freeze nerves during cardiothoracic or thoracic surgicalprocedures.Recovery from cardiothoracic and thoracic surgery can be complicated and painful.Many surgeons use multi

49、ple painmanagement strategies that include oral delivery of opioid and non-opioid pain medications.Our cryoICE cryoSPHERE probesfor pain management(known as Cryo Nerve Block)provides temporary relief of post-operative pain,allowing the patients body toheal after surgery while the nerves regenerate a

50、nd sensation is regained.We sell our products to medical centers through our direct sales force in the United States,Germany,France,the UnitedKingdom,the Benelux region,Canada and Australia.We also sell our products through distributors who in turn sell our products tomedical centers in other intern

51、ational markets.Our business is primarily transacted in U.S.Dollars;direct sales transactions outsidethe United States are transacted in Euros,British Pounds,Canadian Dollars or Australian Dollars.Market OverviewAfib is the most commonly diagnosed sustained cardiac arrhythmia,with over one million d

52、iagnoses annually in the UnitedStates alone.Afib is also an under-diagnosed condition due in large part to the fact that patients with Afib often have mild or nosymptoms,and their Afib is diagnosed when they seek treatment for an associated condition,such as a structural heart disease orstroke.Sympt

53、oms of Afib may include heart palpitations,dizziness,fatigue and shortness of breath,and these symptoms may bedebilitating and life threatening in some cases.When a patient is in Afib,abnormal electrical impulses cause the atria,or upperchambers of the heart,to fibrillate,or beat rapidly,irregularly

54、 and in an uncoordinated fashion.As a result,blood in the atria maybe in stasis,increasing the risk that a blood clot will form and cause a stroke or other serious complications.In patients with Afib,asignificant percentage of those clots can form inside of the LAA.We believe that increasing awarene

55、ss of Afib and improveddiagnostic screening will result in an increased number of patients diagnosed with Afib over time.Also,since the prevalence ofAfib increases with age,there will likely be an increase in the number of diagnosed Afib patients globally as the world populationages.Afib is a condit

56、ion that doctors often find difficult to treat and,historically,there has been no widely accepted long-term curefor Afib.This difficulty is exacerbated with more serious forms of Afib,or persistent and long-standing persistent Afib.Over thepast two decades,technological advancements have made surgic

57、al ablation more effective,repeatable and available to cardiacsurgeons and electrophysiologists around the world.Societal guidelines from the Society of Thoracic Surgeons(STS),HeartRhythm Society(HRS)and American Association of Thoracic Surgery(AATS)have Class I recommendations for concomitantsurgic

58、al ablation,meaning that it is a“recommended”treatment for patients who have structural heart disease and Afib.Guidelinesfor the treatment of more serious forms of Afib for patients without structural heart disease have also been introduced in the pastseveral years.In 2024,the European Society of Ca

59、rdiology(ESC)released Guidelines for Management of Atrial Fibrillationdeveloped in collaboration with the European Association of Cardio-Thoracic Surgery(EACTS),in which they upgraded LAAM tothe highest Class 1 recommendation.During2025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1

60、323885/000132388525000009/atrc-20241231.htm6/8822025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231.htm7/88Table of Contents2023,the American College of Cardiology(ACC),American Heart Association(AHA),American College of Clinical Pharmacy(ACCP)

61、and HRS released Guidelines for Diagnosis and Management of Atrial Fibrillation,and upgraded LAAM to the highestrecommendation of Class 1 and now include Hybrid AF Therapy as a Class 2 recommendation.These societal guidelines arereflective of the scientific evidence suggesting that surgical and hybr

62、id ablation is safe and effective for patients who have Afib.Ofthe patients undergoing open-heart surgery globally on an annual basis,we estimate that over 300,000 are potential candidates forsurgical ablation using our products,as they have pre-operative Afib.Today,we estimate that less than 20%of

63、those candidates arebeing treated with surgical ablation.Therefore,we believe that the market for our ablation products represents a significant growthopportunity.In addition,Afib is thought to be responsible for approximately 15%to 20%of the estimated 800,000 strokes that occurannually in the Unite

64、d States.According to the American Heart Association,the risk of stroke is five times higher in people withAfib.Studies have also suggested that 90%of clots that cause strokes in patients who have Afib originate from within the LAA.In2021,a large independent international randomized trial,Left Atria

65、l Appendage Occlusion Study(LAAOS)III,demonstrated asignificant reduction in strokes when the LAA was managed during cardiac surgery.Afib accounts for billions of dollars inhospitalization-related and office visit costs in the United States each year.Indirect costs,such as the management of Afib-rel

66、atedstrokes,are also believed to be significant.Due to the risk of stroke and the significant cost burden on the healthcare system,moreand more surgeons are routinely addressing the LAA,both in patients who have Afib and in those who do not have Afib but may beat increased risk of developing the dis

67、ease in the future.We believe that our AtriClip system is safer,more effective and easier touse than other products and techniques for excluding the LAA during cardiac surgery.Therefore,we believe that the market for ourAtriClip system represents a significant growth opportunity.Many Afib patients w

68、ithout other underlying structural heart disease,especially those with more advanced forms of Afib,aresymptomatic and experience conditions such as palpitations,breathlessness and drowsiness.These patients tend to be motivated toseek treatment to alleviate their symptoms.Patients who are symptomatic

69、 are often treated by an electrophysiologist using catheterablation.Catheter ablation is considered a percutaneous procedure that does not require the opening of the chest;rather,cathetersare inserted through a small puncture in the groin.In addition to catheter ablation,there are other treatment op

70、tions for patientswith Afib,including pharmacological therapy(anti-arrhythmic drugs)and implantable pacemakers.It is estimated thatapproximately 500,000 Afib patients are treated by catheter ablation every year in the United States,a number that is expected togrow well over 10%annually.While the maj

71、ority of paroxysmal Afib patients treated by catheter ablation tend to experiencefreedom from Afib,less than a third of long-standing persistent patients treated by catheter ablation are cured of their Afib at oneyear,and it declines even more thereafter.Randomized,prospective,multi-center data from

72、 the CONVERGE IDE clinical trial,along with a number of other recent real-world studies performed by physician investigators,show that these long-standingpersistent Afib patients can experience more than double the success rate by adding an ablation on the outside surface of the heartusing our EPi-S

73、ense ablation system.Thus,we believe the EPi-Sense ablation system used as a minimally invasive or Hybrid AFtherapy also represents a significant growth opportunity for the Company.Thoracic surgery involving an incision through the ribcage,typically referred to as thoracotomy access,and cardiothorac

74、icsurgery can often result in significant post-operative pain and longer hospital recovery times as patients refrain from mobilizingtheir chest near the incision site.It is estimated that each year approximately 150,0000 thoracic procedures and approximately250,000 cardiothoracic procedures are perf

75、ormed in the United States.Hospital recovery times can vary from two to fifteen daysdepending on the procedure,operative complications associated with the procedure,pain management protocol and other factors.Most surgeons will employ a multi-modal pain management protocol that includes various pain

76、management techniques,includingtechniques such as epidural delivery of medication directly around the spinal cord,intravenous or oral delivery of opioid and non-opioid pain medications,or other strategies.More focused,local techniques include syringe injections between vertebrates andCryo Nerve Bloc

77、k which uses cryogenic energy to ablate peripheral nerves,temporarily stopping the transmission of pain signalscoming from the chest wall during surgery.The nerve“scaffolds”remain intact,allowing axons to regenerate and restore nervefunction over time.Cryo Nerve Block can be delivered using our cryo

78、ICE cryoSPHERE probes,which are specifically designedfor Cryo Nerve Block therapy.Depending on the degree of invasiveness,physicians and their nursing staff will take advantage ofmultiple ways of managing pain for their patients.In recent years,prescription narcotics,or opioids,have come under heavy

79、scrutiny due to their potential for long-term dependency,overdose and possible death.Both federal and local governments in theUnited States have proposed and implemented new regulations to curb the opioid overdose epidemic.It is also estimated that one inseven thoracic surgery patients develops an u

80、nhealthy post-procedural addiction to prescription narcotics,making alternative,non-opioid pain management modalities,such as Cryo Nerve Block,an increasingly important part of how physicians manage post-operative pain.We believe the market for our pain management ablation products represents a sign

81、ificant growth opportunity.Further,applications for Cryo Nerve Block outside of thoracic surgery use are being studied by physician investigators andrepresent future possible growth opportunities.32025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-2024

82、1231.htm8/88Table of ContentsAtriCure Solutions and ProductsWe believe that we are currently the market leader in the surgical treatment of Afib and LAAM,and pioneers of theapplication of Cryo Nerve Block in cardiothoracic surgical procedures.We anticipate that substantially all our revenue for thef

83、oreseeable future will relate to products we currently sell or are in the process of developing.Our products enable cardiothoracicsurgeons to perform surgical ablation procedures with faster,less invasive and less technically challenging approaches andclinically proven results.We have completed,and

84、continue to invest in,clinical studies for the use of our ablation and LAAMproducts to treat Afib,reduce post-operative Afib,and prevent strokes.Leading cardiothoracic surgeons and electrophysiologists,including those who serve or who have served as consultants to us,have published results of precli

85、nical and clinical studiesutilizing our devices.The results of these studies have assessed efficacy,ease of use and safety endpoints.Products for cardiac tissue ablation include those that create scar tissue using radio frequency(RF)energy or cryogenic(cryo)modalities.Our ablation products are part

86、of platforms,each consisting of disposable hand pieces which connect to either aRF generator or a cryo generator.We generally place this capital equipment with our direct customers and sell to our distributors.Products for open and minimally invasive ablation:Isolator Synergy Clamps.Our Isolator Syn

87、ergy Ablation System clamps are single-use disposable RF productswith jaws that close in a parallel fashion.The system consists of the clamp and an RF generator.We sell multipleconfigurations of our Isolator Synergy clamps.The various configurations provide the user with options to addresspatient sp

88、ecific procedure requirements or anatomy;however,all the clamps provide consistent performance usingthe same core technology.The parallel closure evenly compresses tissue and evacuates the blood and fluids fromthe energy pathway to make the ablation more effective.The Isolator Synergy Ablation Syste

89、m has been studied inmultiple FDA approved clinical trials,including the previously completed ABLATE clinical trial which supported apre-market approval(PMA)in 2011,as well as the ongoing DEEP AF IDE and HEAL-IST clinical trials.Our Isolator Synergy Ablation System includes multiple configurations a

90、pproved by the United States Food andDrug Administration(FDA)for the treatment of persistent and long-standing persistent Afib concomitant to otheropen-heart surgical procedures.Certain products within our Isolator Synergy clamp line are in compliance with theEuropean Union Medical Device Regulation

91、s(EU MDR)and bear the CE mark for commercial distributionthroughout the member states of the European Union(EU)and other countries that comply with or mirror EUMDR.These products are available for sale in a number of other countries globally.In 2022,we launched the EnCompass clamp in the United Stat

92、es,following 510(k)clearance in 2021.TheEnCompass clamp is indicated for cardiac soft tissue ablation and is designed to make concomitant surgicalablations more efficient and is expected to drive deeper penetration of cardiac surgery procedures.In 2024,wereceived 510(k)clearance for our most recent

93、configuration of the Isolator Synergy platform,the EnCaptureclamp,which has enhanced geometry and features to facilitate engagement with the intended cardiac tissue.Multifunctional Pens and Linear Ablation Devices.These devices are single-use disposable RF products thatcome in multiple configuration

94、s.Surgeons generally use one or more of our pen and linear devices in combinationwith Isolator Synergy clamps.Our pen and linear ablation devices are cleared for sale in the United States underFDA 510(k)clearances,with indications for the ablation of cardiac tissue and/or the treatment of cardiacarr

95、hythmias.Certain configurations of our pen and linear ablation devices are also cleared or approved for saleoutside of the United States.Products for open ablation:cryoICE Cryoablation System.The cryoICE cryoablation system is used in both open ablation procedures andcryoanalgesia for post-operative

96、 pain management.The system consists of the cryoICE BOX generator along witha variety of single-use disposable probes.The primary differences between these cryoablation probes is the form ofthe tissue-contacting distal end.The various configurations of cryoICE devices enable the user to make lineara

97、blations of varied length,providing the surgeon with options to address the specific procedural objectives.Surgeons may utilize the cryoICE devices in combination with Isolator Synergy clamps or independently.42025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000

98、009/atrc-20241231.htm9/88Table of ContentsOur cryoablation devices are cleared for sale in the United States under FDA 510(k)clearances,and are incompliance with EU MDR and bear the CE mark for commercial distribution throughout the member states of theEU and other countries that comply with or mirr

99、or EU MDR.These products are available for sale in a number ofother countries globally.The ICE-AFIB clinical trial is studying the safety and efficacy of the cryoICE system for persistent and long-standing persistent Afib treatment during concomitant on-pump cardiac surgery.Products for minimally in

100、vasive ablation:EPi-Sense Systems.The EPi-Sense Guided Coagulation System and the EPi-Sense ST Guided CoagulationSystem utilize monopolar RF energy for the coagulation of tissue.The system consists of the device and an RFgenerator.Our EPi-Sense devices are single-use disposable ablation devices capa

101、ble of intraoperative cardiac signalsensing and recording when connected to an external recording device.Our EPi-Sense System was studied through the CONVERGE clinical trial and approved in 2021 by FDA for thetreatment of patients with systemic,drug refractory,long-standing persistent Afib when augm

102、ented with anendocardial ablation catheter.Our EPi-Sense ST Guided Coagulation System was approved via PMA supplement inlate 2022.Hybrid AF Therapy is the only FDA-approved minimally invasive procedure to treat patients with long-standing persistent Afib and represents a proven option for patients w

103、ith this advanced disease.The EPi-SenseSystem is in compliance with EU MDR and bear the CE mark for commercial distribution throughout the memberstates of the EU and other countries that comply with or mirror EU MDR.This system is available for sale in anumber of other countries globally.In 2024,FDA

104、 granted 510(k)clearance for EPi-Ease,our Hybrid access device to facilitate guide-wire delivery,vacuum application and endoscope insertion.Products for pain management:cryoSPHERE probes.The cryoSPHERE probe is used to apply cryogenic energy to targeted intercostal peripheralnerves in the ribcage in

105、 order to provide temporary pain relief.This technique,called Cryo Nerve Block,is appliedintraoperatively by cardiothoracic or thoracic surgeons and results in temporary pain relief for up to 90 days afterthe procedure.Sensation typically returns to the affected region of the chest after this period

106、.Scientific data that hasbeen published on the effects of Cryo Nerve Block therapy has generally shown a significant reduction inprescription of opioids,significantly reduced length of stay for patients in the hospital and reduced healthcareutilization costs.The cryoSPHERE probe is 510(k)cleared for

107、 managing pain by temporarily ablating peripheralnerves and is in compliance with EU MDR and bears the CE mark for commercial distribution throughout themember states of the EU and other countries that comply with or mirror EU MDR.During 2024,we launched two new cryoSPHERE probes for pain management

108、 in the United States.ThecryoSPHERE+cryoablation probe leverages new technology that minimizes thermal loss by focusing energy atthe ball tip,allowing for a reduction in freeze time by 25%.The cryoSPHERE MAX probe features a larger balltip,designed to optimize Cryo Nerve Block therapy.The cryoSPHERE

109、 MAXprobe reduces freeze times by 50%when compared to the first generation cryoSPHERE cryoablation probe,and over 30%when compared to thecryoSPHERE+probe.Products for appendage management:AtriClip System.The AtriClip LAA Exclusion System includes various combinations of an implantable device(AtriCli

110、p)coupled to a single-use disposable applier.The AtriClip device is designed to exclude the left atrialappendage by mechanically clamping the appendage from the outside of the heart.In addition to the risk of bloodclots originating in the left atrial appendage,the left atrial appendage has also been

111、 shown to be a source ofarrhythmias.The exclusion of the LAA eliminates blood flow between the left atrial appendage and the atriumwhile avoiding contact with circulating blood and provides electrical isolation benefits after placement.We believethat the AtriClip system is safer,more effective and e

112、asier to use than other techniques for permanently excludingthe left atrial appendage.The device comes in two geometries:a rectangular configuration which encircles thetargeted tissue and a“V”shape which allows for an alternative lateral access,and a variety of lengths which arematched to each patie

113、nts anatomy.The appliers come in multiple forms tailored to specific procedural needsdepending on the type of surgery and how the surgeon is accessing the heart.52025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231.htm10/88Table of ContentsIn th

114、e United States,our AtriClip LAA Exclusion System products are 510(k)-cleared with an indication for theexclusion of the LAA,performed under direct visualization and in conjunction with other cardiac surgicalprocedures.Direct visualization,in this context,requires that the surgeon can see the heart

115、directly,with or withoutassistance from a camera,endoscope or other appropriate viewing technologies.Certain products of our AtriClipLAA Exclusion System are in compliance with EU MDR and bear the CE mark for commercial distributionthroughout the member states of the EU and other countries that comp

116、ly with or mirror EU MDR.These productsare available for sale in a number of other countries globally.During 2024,we launched the newest generation AtriClip,the AtriClip FLEX-Mini device,in the United States.The AtriClip FLEX-Mini sets a new standard as the smallest profile for a surgical LAA device

117、 on the market andbuilds upon the proven technology and clinical benefits of our AtriClip platform,with ease of use and designsimplicity that offers enhanced access and increased visibility for physicians.The AtriClip LAA Exclusion System is currently being evaluated under the Left Atrial Appendage

118、Exclusion forProphylactic Stroke Reduction(LeAAPS)IDE clinical trial.We sell additional products and enabling technologies that hold 510(k)approvals,and certain products are in compliancewith EU MDR and bear the CE mark for commercial distribution.The LARIAT System is a solution for soft-tissue clos

119、ure thatincludes a suture loop coupled to a single-use disposable applier.The Lumitip dissector is used by surgeons to separate tissues toprovide access to key anatomical structures that are targeted for ablation.Other enabling technologies include our Glidepathguides for placement of our clamps,Sub

120、tle Cannulas to support access for our EPi-Sense catheters and a line of reusable cardiacsurgery instruments.Business StrategyWe are passionately focused on healing the lives of patients affected by Afib and pain after surgery.Our strategy is to expandthe treatment options for patients who suffer fr

121、om Afib,have a high risk of stroke,may develop post-operative Afib,or who sufferfrom post-operative pain,through the continued development of our technologies and expansion of our product offerings,clinicalscience investments and global commercial expansion.The key elements of our strategy include:N

122、ew Product and Procedure Innovation.Our product development pipeline includes projects which extend and improve ourexisting products,as well as research and development projects for new technologies and new procedural techniques.We plan tocontinue to develop new and innovative products and procedure

123、s,including those that allow us to enter new markets or expand ourgrowth in existing markets.Investments in Clinical Science.We continue to invest in landmark clinical trials to validate the long-term results ofprocedures using our products and to support applications to regulatory agencies for expa

124、nded indications.We also make clinicalresearch grants to support our product development efforts and expand the body of clinical evidence.We believe publication ofadditional scientific evidence,in addition to robust ongoing research activities,will ultimately create an increased demand for ourproduc

125、ts.Build Physician and Societal Relationships.We have formed consulting relationships with cardiothoracic surgeons,cardiologists,electrophysiologists,stroke neurologists and thoracic surgeons who work with us to develop and evaluate ourproducts.Additionally,we regularly form advisory boards made up

126、of key opinion leaders in multiple specialties to provide input toour training and clinical programs.We are building these relationships along with extended care professionals such as nursepractitioners and advanced practice providers,to provide insight regarding treatment trends,input on future pro

127、duct direction andeducation for providers involved in treating the disease.We are partnering with leading surgical and cardiology societies to increase the awareness of Afib treatment options.In thepast seven years,the Society for Thoracic Surgeons(STS),Heart Rhythm Society(HRS),American College of

128、Cardiology(ACC),American Heart Association(AHA),American College of Clinical Pharmacy(ACCP),European Society of Cardiology(ESC)andEuropean Association of Cardio-Thoracic Surgery(EACTS)have released new guidelines on the surgical treatment of Afib in bothopen-heart and minimally-invasive settings,as

129、well as the management of the left atrial appendage in surgical procedures.Provide Training and Education.We have recruited and trained sales and physician education professionals to effectivelycommunicate to our customers the unique features and benefits of our technologies as they relate to their

130、indications for use.Ourhighly trained professionals meet with physicians at institutions around the world to provide education and technical training on thefeatures,benefits and safe-and-effective use of our products.With the approval of our Isolator Synergy System,we instituted aprogram to train pr

131、oviders on the use of the Isolator Synergy System to treat persistent and long-standing persistent Afib in patientsundergoing open-heart surgery.With the approval of the EPi-Sense System,we began programs to train physicians on the use ofthe EPi-Sense system in a hybrid approach to treating patients

132、 with long-standing persistent Afib.More recently,we haveimplemented multidisciplinary training programs focused on62025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231.htm11/882025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1

133、323885/000132388525000009/atrc-20241231.htm12/88Table of Contentsthe heart team approach for creating and growing an arrhythmia treatment program and managing post-operative pain.We believethese training and education programs have increased awareness about the surgical treatment of Afib,and we will

134、 continue to makeinvestments to serve our physician customers.As a result of the educational process,we believe that awareness of our technologiesis growing and will result in the increased use of our products.Evaluate Acquisition Opportunities.We expect to continue to be opportunistic with respect

135、to acquisitions.We evaluateacquisition opportunities on a variety of factors,including product innovation,clinical differentiation and other strategic andfinancial criteria.Research and Product DevelopmentOur ongoing research and development activities support our business strategy to expand treatme

136、nt options and increaseawareness in our current markets,as well as enabling expansion into adjacent markets.We are engaged in developing andresearching new and existing products or concepts,preclinical studies,clinical trials and other regulatory activities.We makesignificant investments in both pro

137、duct development and clinical science activities to drive the advancement and adoption of newtherapies in the marketplace.In the United States,a significant risk device requires the prior submission of an application for an Investigational DeviceExemption(IDE)to FDA for approval before initiating a

138、clinical trial.Clinical trials are required to support a pre-market approval(PMA)and are sometimes required for 510(k)clearance.Some trials require a feasibility study followed by a pivotal trial.We areconducting several clinical trials to validate the long-term results of procedures using our produ

139、cts and to support applications toregulatory agencies for expanded indications.In addition,we also conduct various studies to gather clinical data regarding ourproducts.Key trials and studies are:LeAAPS.In April 2022,FDA approved the protocol for the Left Atrial Appendage Exclusion for Prophylactic

140、StrokeReduction(LeAAPS)IDE clinical trial.The trial is designed to evaluate the effectiveness of prophylactic LAA exclusion using theAtriClip LAA Exclusion System for the prevention of ischemic stroke or systemic arterial embolism in cardiac surgery patientswithout pre-operative AF diagnosis who are

141、 at risk for these events.This prospective,multicenter,randomized trial evaluates safetyat 30 days post-procedure to demonstrate no increased risk with LAA exclusion during cardiac surgery and effectiveness with aminimum follow-up of five years post procedure for all subjects.The trial provides for

142、enrollment of up to 6,500 subjects at up to250 sites worldwide.We enrolled our first patient in January 2023;site initiation and enrollment is ongoing and we expect tocomplete enrollment in 2025.HEAL-IST.In February 2022,FDA approved the protocol for the Hybrid Epicardial and Endocardial Sinus Node

143、SparingAblation Therapy for Inappropriate Sinus Tachycardia(IST)clinical trial(HEAL-IST).The HEAL-IST clinical trial is designed tostudy the safety and efficacy of a hybrid sinus node sparing ablation procedure using the Isolator Synergy Surgical Ablation Systemfor the treatment of symptomatic,drug

144、refractory or drug intolerant IST.The trial is a prospective,multicenter,single arm trial thatevaluates safety 30 days post-procedure and evaluates primary effectiveness of freedom from IST(as specified)at 12 months post-procedure.The trial provides for enrollment of up to 142 patients at up to 40 s

145、ites in the United States,United Kingdom andEuropean Union.The first patient enrollment in the trial occurred in June 2022;site initiation and enrollment is ongoing.CONVERGE.The CONVERGE IDE clinical trial proved the safety and efficacy of the EPi-Sense System to treatsymptomatic persistent and long

146、-standing persistent Afib patients who are refractory or intolerant to at least one Class I and/or IIIanti-arrhythmic drug.In April 2021,FDA granted PMA approval of the EPi-Sense System for treatment of symptomatic,drug-refractory,long-standing persistent atrial fibrillation,when augmented with an e

147、ndocardial ablation catheter.We believe theConvergent procedure,or Hybrid AF therapy,provides the only compelling treatment option for a large and vastly underpenetratedpopulation of long-standing persistent Afib patients.The CONVERGE trial demonstrated superiority in the hybrid therapy armcompared

148、to endocardial catheter ablation alone.In patients diagnosed with long-standing persistent Afib,the therapy arm showeda 29%absolute difference in efficacy at 12 months(78%relative improvement)and an absolute difference of 35%at 18 months(110%relative improvement).There was also a 33%absolute differe

149、nce in Afib burden reduction in favor of the Hybrid AFtherapy at 12 months,which increased to 37%at 18 months.In April 2021,we also received approval from FDA to conduct theCONVERGE Post Approval Study(PAS).This study allows for 325 patients to be enrolled at up to 50 sites.Site initiation andenroll

150、ment in the CONVERGE PAS is ongoing.We have and will continue to invest in other clinical trials to validate the long-term results of procedures using our productsand to support applications to regulatory agencies for expanded indications.The Company continues to perform long-term patientfollow-up i

151、n multiple studies and plans to present results at 2025 meetings.72025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231.htm13/88Table of ContentsIn May 2024,the Company finished twelve-month patient follow-up required by the ICE-AFIB study protoc

152、ol.TheCompany has completed the analyses of the primary effectiveness and safety endpoints and is pursuing publicationopportunities with reputable cardiac surgery journals.The ICE-AFIB clinical trial is designed to study the safety andefficacy of the cryoICE system for persistent and long-standing p

153、ersistent Afib treatment during concomitant on-pumpcardiac surgery.The CEASE-AF three-year outcomes abstract was submitted and accepted for presentation at the 2025 European HeartRhythm Association(EHRA)meeting.CEASE-AF is a prospective,multi-center randomized control trial thatdemonstrated superior

154、 freedom from atrial arrhythmias for staged hybrid ablation compared to endocardial catheterablation.During the fourth quarter of 2023,the 12-month follow-up results of enrolled patients from the DEEP AF Pivotal studywere presented at the American Heart Association meeting.The two-year DEEP outcomes

155、 poster has been accepted forpresentation at the 2025 AF Symposium.The DEEP AF IDE pivotal trial evaluated the safety and efficacy of the AtriCureBipolar System when used in a staged approach where a minimally invasive surgical ablation procedure is first performed.The patient undergoes the endocard

156、ial catheter procedure approximately 91-120 days later.The results from this singlearm study demonstrated superior freedom from atrial arrhythmias for staged hybrid ablation compared to a pre-specifiedperformance goal.The Company is conducting analyses of additional trial data for publication,future

157、 development activities,or possible evaluation oflabel expansions.Sales,Marketing and Medical EducationOur global sales and marketing efforts focus on educating physicians about our unique technologies and their clinicalbenefits.We only promote our products for uses described in their labeling as cl

158、eared or approved by relevant regulatory agencies,and train our sales force on the use of our products to the extent the products are cleared or approved.Our sales team in the United States has approximately 310 employees.We select our sales personnel based on their expertise,experience and reputati

159、on in the medical device industry and their knowledge of cardiac and thoracic surgery procedures andtechnologies.We market and sell our products in selected countries outside of the United States through a combination of independentdistributors and direct sales personnel.Our international sales team

160、 includes approximately 70 employees focused on our directmarkets,such as Germany,France,the United Kingdom,the Benelux region,Canada and Australia.We also maintain a network ofdistributors who market and sell our products in Asia and South America,as well as certain countries in Europe.We continue

161、toevaluate opportunities for further expansion into markets outside of the United States.CompetitionAtriCure has the only medical devices that are approved by FDA for treating long-standing persistent Afib:the IsolatorSynergy Ablation,the first medical device to receive FDA approval for the treatmen

162、t of persistent Afib in a concomitant setting,and the EPi-Sense System,which received FDA approval for standalone treatment of Afib with Hybrid AF Therapy.However,ourindustry is competitive,is subject to change and can be significantly affected by new product introductions and other activities ofind

163、ustry participants.We compete with other companies and divisions of companies that sell a single or limited number ofcompetitive product lines or in certain geographies.Our primary competitor in the cardiac surgery market is Medtronic,plc,whoprovides surgical ablation products and LAAM devices used

164、by physicians for the treatment of Afib and related conditions.Forstandalone treatment of Afib,several companies offer endocardial catheter devices that are commonly used by electrophysiologists.These catheter devices are FDA-approved to treat the paroxysmal and persistent forms of Afib,but they are

165、 not FDA indicated andhave not been studied for the treatment of long-standing persistent Afib.Since our Hybrid AF Therapy involves both epicardial andendocardial techniques,we believe these catheters are complementary to our business because our products improve treatmentoutcomes for patients with

166、non-paroxysmal forms of Afib when combined with intracardiac catheter devices.AtriCure is monitoring other companies who are conducting clinical trials that may support FDA approval of their devices totreat persistent and long-standing persistent Afib,although we are not aware of any ongoing FDA tri

167、als by other companies to studyablation of long-standing persistent Afib patients.We are aware of other companies developing technology for cardiac tissueablation and appendage management.New product introductions,technological advances and regulatory clearances fromcompetitors may impact the use of

168、 our products in cardiac procedures.In addition to the cardiac surgery market,we also considercompetition within the post-operative pain market.Currently,we are not aware of other companies in the United States who arepursuing cryo nerve block therapies for thoracic surgery.There are other companies

169、 outside of the United States who market theirdevices for a similar therapy.82025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231.htm14/882025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231

170、.htm15/88Table of ContentsThird-Party ReimbursementReimbursement for health care services in the United States is generally made by third-party payors.These payors includeprivate insurers and government insurance programs,such as Medicare and Medicaid.The Medicare program,the largest singlepayor in

171、the United States,is a federal health benefit program administered by the Centers for Medicare and Medicaid Services(CMS)and covers certain medical care items and services for eligible beneficiaries,primarily individuals over 65 years old,as wellas chronically disabled individuals.Because Medicare b

172、eneficiaries comprise a large percentage of the populations for which ourproducts are used,and private insurers may follow the coverage and payment policies for Medicare,Medicares coding,coverageand payment policies for cardiothoracic surgical procedures are significant to our business.Medicares Par

173、t A program pays hospitals for inpatient services,such as cardiothoracic surgery,under the InpatientProspective Payment System,which provides a predetermined payment based on the patients discharge diagnoses and surgicalprocedure(s).Discharge diagnoses are grouped into Medicare Severity Diagnosis Re

174、lated Groupings(MS-DRG).There are severalcardiac surgery MS-DRGs associated with the surgical treatment of Afib,with and without a concomitant open-heart procedure.When an ablation device and/or LAAM device is used during a concomitant open-heart procedure,Medicares hospitalreimbursement is based up

175、on the patients primary structural heart surgical procedure.In contrast,sole therapy minimally invasiveablation or surgical LAAM procedures typically are reimbursed under a general cardiac surgery or intracardiac procedure MS-DRG.We believe hospital reimbursement rates for sole therapy and concomita

176、nt therapy cardiac surgical ablation or surgicalLAAM are adequate to cover the cost of our products even when multiple procedures are performed.Similar to surgical ablationfor Afib or surgical LAAM,cryoablation performed for post-operative pain management is reimbursed as part of the primaryprocedur

177、e,open thoracic or cardiac surgery,MS-DRG.We believe hospital reimbursement rates are typically adequate in thesesituations.Physicians are reimbursed for their services separately under the Medicare Part B physician fee schedule.When performing asurgical cardiac ablation with and without a concomita

178、nt open-heart procedure,surgeons report Current Procedural Terminology(CPT)codes to receive a professional fee payment.Multiple CPT codes may be reported by a physician during a procedure ifmultiple procedures are performed.There are category one CPT codes for both concomitant and standalone surgica

179、l Afib treatment,as well as surgical LAAM.However,some providers utilize unlisted CPT codes to obtain reimbursement when no appropriate CPTcode exists,such as Cryo Nerve Block ablation when used for post operative pain control.In addition to the Medicare program,many private payors look to CMS polic

180、ies as a guideline in setting their coveragepolicies and payment amounts.The current coverage policies of these private payors may differ from the Medicare program,andpayment rates may be higher,lower,or the same as the Medicare program.In some cases,certain private payors adopt negativecoverage pol

181、icies with respect to therapies involving our products.We provide private payors information on FDA labels and newpublished studies to support positive coverage policies.We also engage third-party reimbursement consultants that provide supportto our customers in the event of a coverage denial.Outsid

182、e of the United States,third-party reimbursement varies widely by geography and by the type of therapy in which ourdevices are used.For example,even though a new medical device may have been approved for commercial distribution,we mayfind limited demand for the device until coverage and sufficient r

183、eimbursement levels have been obtained from governmental andprivate third-party payors.In addition,some private third-party payors require that certain procedures or the use of certain productsbe authorized in advance as a condition of reimbursement.In some countries,cost containment initiatives and

184、 health care policiesmay significantly reduce reimbursement for procedures using our medical devices or deny coverage for those proceduresaltogether.We are actively working to pursue market access in certain geographies,which includes applying for newreimbursement for therapies in which our devices

185、are being used or pursuing specific reimbursement for utilization of our devices.Government RegulationOur products are medical devices and are subject to regulation in the United States by FDA and other federal agencies,andby comparable authorities in the European Union(EU)and other countries worldw

186、ide.United States Regulation:FDA regulations govern nearly all of the activities that we perform,or which are performed on our behalf,to ensure thatmedical products distributed domestically or exported internationally are safe and effective for their intended uses.FDA regulatesthe total product life

187、cycle from early design,development and testing,to manufacturing and commercialization activities,as wellas post-market surveillance and reporting,including corrective actions,removals and recalls.Unless an exemption applies,mostmedical devices distributed in the United States require either 510(k)c

188、learance or PMA from FDA.92025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231.htm16/88Table of Contents510(k)Clearance Pathway.To obtain 510(k)clearance,we must submit a notification to FDA demonstrating that ourproposed device is substantially

189、 equivalent to a predicate device,i.e.,a previously cleared and legally marketed 510(k)device or adevice that was in commercial distribution before May 28,1976,for which FDA has not yet called for the submission of a PMA.Any modification to a 510(k)-cleared device that would constitute a major chang

190、e in its intended use,or a change in its design ormanufacture that could significantly affect the safety or effectiveness of the device,requires a new 510(k)clearance.Premarket Approval Pathway.A PMA must be submitted to FDA if the device cannot be cleared through the 510(k)process and is not otherw

191、ise exempt.A PMA must be supported by extensive data,including but not limited to technical,preclinical,clinical,real-world data,manufacturing and labeling,to demonstrate the safety and effectiveness of the device for itsintended use.A PMA supplement is required for changes affecting the safety or e

192、ffectiveness of a PMA-approved device,includingbut not limited to new indications for use,a different manufacturing facility,or changes in the manufacturing process,labeling,ordesign specifications or components of the device.Clinical Trials.Clinical trials are required to support a PMA and are some

193、times required for 510(k)clearance.Clinical trialsare subject to extensive recordkeeping and reporting requirements.Our clinical trials must be conducted under the oversight of anInstitutional Review Board(IRB)for the relevant clinical trial sites and must comply with FDA regulations,including,but n

194、otlimited to,those relating to current good clinical practices.We are also required to obtain the written informed consent of patientsin form and substance that complies with both FDA requirements and other human subject protection regulations established byFDA.We must conduct our clinical studies i

195、n compliance with state and federal privacy laws,including the Health InsurancePortability and Accountability Act(HIPAA).Educational Grants.FDA regulates the promotion of medical devices by manufacturers and prohibits the promotion bymanufacturers of uses that are not within the approved or cleared

196、labeling of the device.FDA does not regulate the practice ofmedicine or the conduct or content of medical education conducted by third parties,which may include uses that are not withinapproved or cleared device labeling.Manufacturers may provide unrestricted financial support for independent third-

197、party medicaleducation programs in the form of educational grants intended to offset the cost of such programs.If the manufacturer controls orunduly influences the content of such programs,FDA considers those programs to be promotional activities by the manufacturerand thus subject to FDA regulation

198、 including promotional restrictions.We seek to ensure that our educational grants program isconducted in accordance with FDA criteria for independent educational activities.However,we cannot provide an assurance thatFDA or other government authorities would view the third-party programs we have supp

199、orted as being independent.Pervasive and Continuing Regulation.There are numerous regulatory requirements that apply after a product is cleared orapproved by FDA,including,but not limited to:annual establishment registration and product listing;current good manufacturingpractice for devices(GMP);lab

200、eling requirements and advertising and promotion guidelines;assessing the significance of anychanges to a device;monitoring and reporting serious and adverse events and certain device malfunctions;and reporting certaindevice corrections and removals.Our manufacturing facilities and processes are als

201、o subject to FDA inspections to ensurecompliance with Quality System Regulations(QSR).In addition to FDA regulation,the advertising and promotion of certain medical devices are also regulated by the FederalTrade Commission and by state regulatory and enforcement authorities.On occasion,promotional a

202、ctivities for FDA-regulatedproducts can be the subject of enforcement action brought under healthcare reimbursement laws and consumer protection statutes.In addition,under the Federal Lanham Act and similar state laws,competitors and others can initiate litigation relating toadvertising claims.Fraud

203、,Abuse and False Claims.We are directly and indirectly subject to various federal and state laws governing ourrelationship with healthcare providers.In particular,the Anti-Kickback Statute is a federal criminal law that applies broadly andprohibits the knowing and willful offer or payment of remuner

204、ation to induce or reward patient referrals or the generation ofbusiness involving any item or service payable by a federal health care program.The federal False Claims Act(FCA)imposes civilliability on any person or entity that submits,or causes the submission of,a false or fraudulent claim to the

205、United Statesgovernment.Damages under the FCA consist of the imposition of fines and penalties and can be significant.The FCA also allows aprivate individual or entity with knowledge of past or present fraud against the federal government to sue on behalf of thegovernment to recover the civil penalt

206、ies and treble damages.AtriCure is a member of the Advanced Medical Technology Association(AdvaMed),a voluntary United States tradeassociation for medical device manufacturers.This association has established guidelines and protocols for medical devicemanufacturers in their relationships with health

207、care professionals on matters including research and development,product trainingand education,grants and charitable contributions,support of third-party educational conferences and consulting arrangements.Adoption of the AdvaMed Code of Ethics for Interactions with Healthcare Professionals(AdvaMed

208、Code)102025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231.htm17/88Table of Contentsby a medical device manufacturer is voluntary,and while the Office of the Inspector General and other federal and state healthcareregulatory agencies encourage

209、its adoption and may look to the AdvaMed Code,they do not view adoption of the AdvaMed Codeas proof of compliance with applicable laws.We have adopted the AdvaMed Code by incorporating its fundamental principles intoour Global Health Care Compliance Manual and incorporated its principles in our comp

210、liance policies,employee training programsand relationships with medical professionals.Regulation Outside of the United States:Sales of medical devices outside of the United States are subject to foreign governmental regulations which varysubstantially from country to country.The time required to ob

211、tain certification or approval by a foreign country may be longer orshorter than that required for FDA clearance or approval and the requirements may be different,but the general trend is towardincreasing regulation and greater requirements for the manufacturer to provide more bench testing and clin

212、ical evidence.Inaddition,regulatory agencies and authorities can halt distribution within the country or otherwise take action in accordance withlocal laws.AtriCure is a member of MedTech Europe,a voluntary trade association for the medical technology industry includingdiagnostics,medical devices an

213、d digital health.MedTech Europe and its members are committed to a high level of ethical businesspractices and have put in place strict guidelines to advise medical technology manufacturers on how to collaborate ethically withhealthcare professionals(HCPs).These guidelines are set out in the MedTech

214、 Europe Code of Ethical Business Practice(MedTechCode),which regulates all aspects of the industrys relationships with HCPs and healthcare organizations(HCOs).It covers medicaleducation and research and development.It also introduces an independent enforcement mechanism and transparency obligations.

215、The Code sets clear and transparent rules for the industrys relationships with HCPs and HCOs,including company events,third-party organized events,arrangements with consultants,gifts,research and financial support to medical education.We have adoptedthe MedTech Code and incorporated its principles i

216、nto our Global Health Care Compliance Manual,employee training programsand relationships with medical professionals.This manual also takes into account other global compliance principles as set forth inother international codes of ethics,such as the APAC Med Code of Ethical Conduct and AdvaMed China

217、 Code.Global anti-bribery laws such as the US Foreign Corrupt Practices Act,the UK Anti-Bribery Act,and other similar lawsapply in markets around the world.We have incorporated these principles into our compliance policies and Global Health CareCompliance Manual,training programs,and business practi

218、ces.Conformity Assessment Pathway.In the European Union,various directives regulate the design,manufacture and labelingof medical devices,and more stringent conformity assessment requirements have been put in place with the 2017 Medical DeviceRegulation,effective May 26,2021.The method for assessing

219、 conformity varies depending on the type and class of the product,but typically involves a combination of quality system assessment and product conformity assessment by a third-party notifiedbody,an independent and neutral institution appointed by a country to conduct the conformity assessment.This

220、third-partyassessment includes a review of documentation related to the device that may be as extensive as the documentation requirementsthat the United States FDA requires for higher risk products.The notified body also audits the manufacturers quality system andperforms a detailed review of the te

221、sting of the manufacturers device.Successful completion of a conformity assessmentprocedure allows a manufacturer to issue a declaration of conformity with the requirements of the relevant directive and affix theCE mark to the device.Devices that bear the CE mark may be commercially distributed thro

222、ughout the member states of theEuropean Union and other countries that comply with or mirror the medical device regulations.Pervasive and Continuing Regulation.There are numerous regulatory requirements that apply after a product has beenapproved by the notified body for CE marking,including,but not

223、 limited to:labeling,advertising and promotion,reporting ofdevice modifications,monitoring the safety of the product and performing corrections and removals when necessary,maintaining“state of the art”requirements for the devices through compliance with standards,and obtaining recertification of the

224、 qualitysystem and individual device certificates on a periodic basis.Consulting RelationshipsWe have developed consulting relationships with scientists and physicians throughout the world to support our research anddevelopment,clinical and training and education programs.We work closely with these

225、thought leaders to understand unmet needsand emerging applications for the treatment of Afib and other diseases and conditions.Our physician consulting agreements are intended to satisfy the requirements of the personal services“Safe Harbor”regulation as well as the AdvaMed Code and the MedTech Euro

226、pe Code of Ethical Business Practice.As such,they provide forpayment of a fair market value fee only for legitimate services rendered to us.We do not expect or require the consultant to utilizeor promote our products,and consultants are required to disclose their relationship with us as112025/5/19 1

227、2:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231.htm18/88Table of Contentsappropriate,such as when publishing an article in which one of our products is discussed.Amounts paid to physicians in the UnitedStates are disclosed by us in annual reports subm

228、itted to CMS under the federal“Open Payments”law.Amounts paid to physiciansin certain other countries are also disclosed by us in reports submitted to various governmental agencies in those countries,inaccordance with the laws of the jurisdictions where those physicians reside or practice,or where t

229、he payments are made.Intellectual PropertyProtection of our intellectual property is a priority for our business,and we rely on a combination of patent,copyright,trademark and trade secret laws to protect our interests.Our ability to protect and use our intellectual property rights in thecontinued d

230、evelopment and commercialization of our technologies and products,operate without infringing the proprietary rightsof others,and prevent others from infringing our proprietary rights is important to our continued success.We will be able to protectour products and technologies from unauthorized use b

231、y third parties only to the extent that they are covered by valid andenforceable patents,trademarks or copyrights,or are effectively maintained as trade secrets,know-how or other proprietaryinformation.We hold numerous issued United States and international patents.We also have multiple pending Unit

232、ed States andinternational patent applications.We seek patent protection relating to technologies and products we develop in both the UnitedStates and in selected foreign countries.While we own much of our intellectual property,including patents,patent applications,trademarks,trade secrets,know-how

233、and proprietary information,we also license know-how and related technology of importanceto the commercialization of our products.To continue developing and commercializing our current and future products,we maylicense intellectual property from commercial or academic entities to obtain the rights t

234、o technology that is required for ourresearch,development and commercialization activities.All of our employees and technical consultants are required to execute confidentiality agreements in connection with theiremployment and consulting relationships with us.We also generally require them to agree

235、 to disclose and assign to us allinventions conceived in connection with their relationship with us.We devote significant resources to obtaining patents and otherintellectual property and protecting our other proprietary information.If valid and enforceable,these patents may give us a meansof blocki

236、ng competitors from using infringing technology to compete directly with our products.We also have proprietaryinformation that may not be patentable.With respect to proprietary information that is not patentable,we have chosen to rely ontrade secret protection and confidentiality agreements to prote

237、ct our interests.ManufacturingWe assemble,inspect,test and package the majority of our products at our facilities in Ohio,and our products are sterilizedby third parties.Purchased components are often sourced from a single supplier,but alternatives to critical suppliers are availablein the event thi

238、s would be needed.To minimize supply chain risks,we maintain inventory levels of components and raw materials specific to the respective partor device.We assess tooling and equipment on an ongoing basis.Order quantities and lead times for components purchased fromoutside suppliers are based on our f

239、orecasts derived from historical demand and anticipated future demand.Lead times may varysignificantly depending on the size of the order,time required to fabricate and test the components,specific supplier requirementsand current market demand for the components and raw materials.To date,we have no

240、t experienced significant product availabilityor delay issues directly related to obtaining any of our components.We regularly audit our suppliers for compliance with our quality system requirements,the QSR and/or applicableInternational Organization of Standardization(ISO)standards.We are an FDA-re

241、gistered medical device manufacturer andcertified to ISO 13485:2016.We routinely conduct internal audits of our quality systems in accordance with various internationalstandards.In addition,we have successfully participated in the Medical Device Single Audit Program(MDSAP)and have beencertified acco

242、rdingly.The MDSAP program is recognized in Australia,Brazil,Canada,Japan and the United States.We are subject to numerous federal,state and local laws relating to such matters as laboratory practices,the experimental useof animals,the use and disposal of hazardous or potentially hazardous substances

243、,safe working conditions,manufacturingpractices,environmental protection and fire hazard control.Human Capital ManagementSuccessful execution of our strategy is dependent on attracting,developing and retaining key employees and members of ourmanagement team.As of December 31,2024,we had approximatel

244、y 1,300 employees.Our Board of Directors,along with theCompensation Committee,provides oversight of human capital management including demographics,diversity and inclusionefforts,and aspects of employee compensation.122025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/0001323

245、88525000009/atrc-20241231.htm19/88Table of ContentsAt AtriCure,our employees are crucial to the ongoing success of the company.The skills,experience and industryknowledge of our employees significantly benefit our operations and performance.We continuously evaluate,modify and enhanceour internal pro

246、cesses to increase employee engagement,productivity and efficiency,as well as to recruit new employees to supportour growth.Recognizing the significance of our employees to our success,we include a“people objective”in our annual incentiveplan to ensure focus and accountability.Talent Attraction and

247、RetentionWe attract top talent to AtriCure,provide mechanisms for them to take ownership of their career paths and support theircareer aspirations to build a long-term future with our company.Over the last five years,the voluntary turnover rate among ouremployees has remained consistently below 12%,

248、outperforming the industry average for medical device companies.We conductengagement surveys of our employees at least annually with our last Organizational Health Survey resulting in above averageresults when compared to similar size companies.In addition,our employees have voted us as a Top Workpl

249、ace nine times in thepast ten years,and internationally,our employees have voted us a Great Place to Work for three consecutive years.We alsopromote employee retention and development by supporting internal movement to create accretive experiences for our employees.We have made focused efforts to at

250、tract diverse candidates in our pipeline and have expanded our recruiting channels to connectwith new communities.Talent Management and DevelopmentOur philosophy of Talent Mastery is our aspirational commitment to spend as much time focusing on our talent as we do onour business strategies.Under thi

251、s philosophy,we believe our leaders will better help attract,develop and retain talent.We arecommitted to identifying and developing the talents of our next-generation leaders,and conduct a comprehensive Talent andOrganization Planning to position AtriCure with appropriate organization and leadershi

252、p capability to meet current and futurebusiness needs.In that process,we review existing leaders and prospective leaders throughout the organization and determine thenext best steps for their future development.Employee development is an important part of the way we drive retention and foster a stro

253、ng culture of learning.We haveinvested in programs to drive ongoing career development and provide a range of training courses and online resources foremployees,and opportunities for coaching and mentoring.Programs and offerings for development include AMPLIFY,ourleadership development program for m

254、id-level leaders across the company;Manager Foundations Certification Program to provideall people-managers with tools and resources to be effective managers,and AtriCure YOUniversity,a series of competency-basedcourses for global employees.In addition to development programs for all employees,we ha

255、ve several functional developmentprograms,such as the Engineering Development Program that offers four six-month rotations through different departments as partof our differentiated early pipeline talent development and the Sales Training Associates program focused on rotating talent withinfunctions

256、 to support future commercial roles.Lastly,we provide tuition reimbursement for employees pursuing undergraduate andgraduate degrees.Diversity,Equity and Inclusion(DE&I)We are driven by the belief that diverse skills and experiences produce better outcomes and more innovative solutions toimprove pat

257、ients lives.We have an ongoing commitment to advancing DE&I throughout our workplace and the communities inwhich we operate.Our leaders create an environment that fosters a sense of belonging and ignites passion within their team.Thisleader-led approach to building an equitable and inclusive workfor

258、ce has a longstanding commitment to fostering a workplace thatrejects discrimination,celebrates differences,and promotes equality.In 2024,the Company earned recognition by Fast Company,Inc.as the company that offers the best opportunities for women innovators.This honor reflects our commitment to fo

259、stering anenvironment where women can thrive,innovate and lead in advancing solutions.Our DE&I framework guides our long-term visionand is grounded in the following objectives:Attract and develop employees resembling the diversity of the communities and patients we serve.Create a diverse talent pipe

260、line by fostering awareness of STEM and healthcare careers for women and ethnically diversegroups.Foster a culture of inclusion and belonging where all employees are valued and empowered.Enhance DE&I understanding and behaviors through education and development.Increase awareness and advocate for di

261、versity in medical research and clinical trials through healthcare partnerships.Collaborate with our partners to engage communities to promote heart health awareness.132025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231.htm20/88Table of Content

262、sOur DE&I efforts and programs advance our commitment by fostering employee understanding,intentionality andmeasurable processes.This commitment is also reflected in the current makeup of our Board of Directors,which helps to set the“tone at the top”for our DE&I initiatives.Compensation and Benefits

263、Competitive compensation and benefits are an integral part of our efforts to attract and retain world-class talent.We arecommitted to regularly analyzing and evaluating the effectiveness of our compensation and benefit programs and benchmarkingour programs against the market and our industry peers.A

264、nnual pay increases and other forms of incentive compensation are basedon performance and market evaluation.Performance expectations are communicated to employees at the time of hiring,as well asupon internal transfer or promotion,and documented through our annual performance management process.Bene

265、fits for eligible U.S.-based employees include medical,dental and vision insurance;paid leave for vacation,illness andvolunteer time;parental leave,fertility and adoption assistance;a 401(k)retirement plan that includes a company matchingcontribution;a stock purchase plan enabling employees to purch

266、ase AtriCure stock at a reduced price;and life and disabilityinsurance.Our international employee benefits vary due to local regulations and offerings.We ensure compliance with all statutoryand mandatory benefits which vary by country,such as medical,disability,retirement/pension,workers compensatio

267、n,accident,social benefits and paid leave.None of our employees are represented by a labor union,and we have never experienced anyemployment-related work stoppages.We consider our employee relations to be in good standing.Our attrition rate is historicallylower than the industry average.AtriCure has

268、 a strong company culture,which is reflected in our employee engagement and overallsuccess.Safety for All EmployeesWe are committed to maintaining a safe workplace and promoting all our employees well-being.We have implementedmultiple safety programs and regularly perform safety hazard evaluations w

269、ithin our facilities.Programs include our EmergencySite Action Plan for emergencies such as fire response,severe weather threats and shelter in place incidents,as well as our CertifiedFirst Responders safety program that include Red Cross training of employees in CPR,AED Usage and First Aid practice

270、s.Werecognize that the use of tobacco is linked to many adverse health effects,including those that impact the heart,and we offer ouremployees tobacco cessation programs.Since 2021,our Ohio office locations are entirely tobacco-and nicotine-free,and to theextent permitted in the local jurisdictions

271、of our other offices,those locations are also tobacco-and nicotine-free.Available InformationOur principal executive offices are located at 7555 Innovation Way,Mason,Ohio and our telephone number is 513-755-4100.We are subject to the reporting requirements under the Securities Exchange Act of 1934.C

272、onsequently,we are required tofile reports and information with the Securities and Exchange Commission(SEC)including reports on the following forms:Form10-K,Form 10-Q,Form 8-K,and amendments to those reports filed or furnished pursuant to Section 13(a)or 15(d)of theSecurities Exchange Act of 1934.Th

273、ese reports and other information concerning us may be accessed through the SECs website athttp:/www.sec.gov.You may also find,free of charge,on our website at http:/,electronic copies of our Form10-Ks,Form 10-Qs,Form 8-Ks and amendments to those reports filed or furnished pursuant to Section 13(a)o

274、r 15(d)of theSecurities Exchange Act of 1934.Such filings are placed on our website as soon as reasonably practicable after they are filed orfurnished,as the case may be,with the SEC.Charters for our Audit,Compensation,Nominating and Corporate Governance,Strategy,and Compliance,Quality and Risk Comm

275、ittees and our Code of Conduct are available on our website.In the event thatwe grant a waiver under our Code of Conduct to any of our officers or directors or make any material amendments to the Code ofConduct,we will publish it on our website within four business days.Information on our website is

276、 not deemed to be a part of thisForm 10-K.142025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231.htm21/88Table of ContentsITEM 1A.RISK FACTORSThe following discussion of risk factors contains forward-looking statements.These risk factors may be

277、important tounderstanding other statements in this report.The following information should be carefully considered in addition to the otherinformation set forth in this report,including the Managements Discussion and Analysis of Financial Conditions and Results ofOperations section and Consolidated

278、Financial Statements and accompanying notes.If any of the risks or uncertainties describedbelow actually occur or continue to occur,our business,reputation,financial condition,results of operations,future prospects andstock price could be materially and adversely affected.The risks below are not the

279、 only risks we face and additional risks notcurrently known to us or that we presently deem immaterial may emerge or become material at any time and may negativelyimpact our business,reputation,financial condition,results of operations,future prospects or stock price.The order in which thesefactors

280、appear should not be construed to indicate their relative importance or priority.Risk Factors SummaryThe following is a summary of the principal risks that could adversely affect our business,operations,financial results and stockprice.Commercial Execution and Product Performance RisksFailure to ach

281、ieve widespread market acceptance domestically may harm operating results.Competition from existing and new products and procedures may decrease our market share.Clinical data may be negative,or our trials may not satisfy requirements of regulatory authorities,slowing or reversing the rateof adoptio

282、n or reducing use of our products by the medical community.Reliance on independent distributors to sell our products in some international markets could adversely impact our sales.Industry Condition RisksA prolonged downturn in macroeconomic conditions may materially adversely affect our business.Go

283、vernment and private payors may contain or reduce healthcare spending,including reimbursement for procedures thatutilize our products.Adverse changes in governmental and third-party payors policies toward coverage and reimbursement for surgical procedureswould harm our ability to promote and sell ou

284、r products.Operational RisksUnfavorable publicity relating to our business or industry could negatively impact our operations or stock price.Reliance upon single and limited source third-party suppliers and service providers could harm our business if such thirdparties cannot provide materials or pr

285、oducts or perform services for us in a timely manner.Our manufacturing operations are highly centralized and disruption could harm our business.If we fail to properly manage our anticipated growth,our business could suffer.If we cannot retain our skilled and experienced officers and other employees,

286、or recruit,hire,train and integrate sufficientadditional qualified personnel,our business may suffer.Disruptions of critical information systems or material breaches in the security of our systems could harm our business,customer relations and financial condition.Our insurance may not cover our inde

287、mnification obligations and other liabilities associated with our operations.Legal&Compliance RisksWe could face substantial penalties if we do not fully comply with federal,state and foreign regulations.We may be subject to fines,injunctions and penalties if we fail to comply with extensive FDA reg

288、ulations.Unless and until we obtain additional FDA approval for our products,we will not be able to promote them for treatment ofAfib,prevention of stroke,or reduction of post-operative Afib,and our inability to maintain or grow our business could beharmed.We may be subject to fines,injunctions and

289、penalties if we are found to be promoting our products for unapproved oroff-label uses.Modifications to our products may require new clearances or approvals by FDA;failure to obtain such clearances or approvalswhere required could result in a recall of the modified products and limitation on future

290、sales until cleared or approved.152025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231.htm22/88Table of ContentsIf we or our third-party vendors fail to comply with extensive FDA regulations relating to the manufacturing of our products,we may b

291、e subject to fines,injunctions and penalties.The use of products we sell may result in injuries or other adverse events that lead to product liability claims.Our ability to compete in the marketplace could be affected if our intellectual property rights fail to provide meaningfulcommercial protectio

292、n for our products.Litigation and administrative proceedings over patent and other intellectual property rights are common in our industry,andany litigation or claim against us may cause us to incur substantial costs.We are subject to various regulatory and other risks related to selling our product

293、s internationally which could harm ourrevenue.Any allegation or determination of wrongdoing under the Foreign Corrupt Practices Act or other anti-corruption laws couldhave a material adverse effect on our business.The use of artificial intelligence technology by our employees or business partners co

294、uld result in misuse or loss of proprietaryinformation,violation of laws and regulations,or damage to our reputation and credibility.Financial RisksOur quarterly financial results are likely to fluctuate significantly.We have a history of net losses,and we may never become profitable.Governmental au

295、thorities may challenge our intercompany transfer pricing policies or change their laws in a manner that couldincrease our effective tax rate.Our goodwill may become impaired which could adversely affect our financial performance.We may take inventory-related charges as a result of inaccurate foreca

296、sting or estimates of product life cycles which wouldnegatively affect our gross margins and results of operations.We are subject to credit risk from our accounts receivable related to our sales.We may be unable to comply with the covenants of our Loan Agreement.Common Stock RisksWe may fail to achi

297、eve our publicly announced guidance about our business which could cause a decline in our stock price.Securities analysts may discontinue coverage for our common stock or issue reports which could have a negative impact on themarket price of our common stock.Our common stock may experience extreme f

298、luctuations in the price and trading volume causing our stockholders to lose someor all of their investment.The sale of material amounts of common stock could encourage short sales by third parties and depress the price of ourcommon stock causing our stockholders to lose part or all of their investm

299、ent.Stockholder ownership of our common stock may be diluted if we sell common stock in a capital raising transaction or issueshares in a future acquisition.Anti-takeover provisions in our amended and restated certificate of incorporation and amended and restated bylaws and underDelaware law could i

300、nhibit a change in control or a change in management that stockholders consider favorable.Our stockholders must rely on stock appreciation for any return on investment as we do not expect to pay dividends in theforeseeable future.162025/5/19 12:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1

301、323885/000132388525000009/atrc-20241231.htm23/88Table of ContentsCommercial Execution and Product Performance RisksIf our products do not achieve widespread market acceptance in the United States,our operating results will be harmed,and we may not achieve or sustain profitability.Our success depends

302、 in large part on the medical communitys acceptance of our products in the United States,which is thelargest revenue market in the world for medical devices.We expect that sales of our ablation and LAAM products will continue toaccount for a majority of our revenue for the foreseeable future and tha

303、t our future revenue will depend on the increasingacceptance by the medical community of our products as standard of care for treating Afib,managing the LAA and managing post-operative pain with Cryo Nerve Block therapy.The U.S.medical communitys acceptance of our products will depend upon ourabilit

304、y to demonstrate the safety and efficacy,advantages,short and long-term clinical performance and cost-effectiveness of ourproducts.In addition,acceptance of products for the treatment of Afib is dependent upon,among other factors,the level ofawareness and education of the medical community about the

305、 surgical treatment of Afib and the existence,effectiveness and safetyof our products.Market acceptance and adoption of our products for the treatment of Afib also depends on the level of healthinsurer(including Medicare)reimbursement to physicians and hospitals for procedures using our products.Neg

306、ative publicityresulting from incidents involving our products,or similar products could have a significant adverse effect on the overallacceptance of our products.If we encounter difficulties growing the market for our products in the United States,we may not beable to increase our revenue enough t

307、o achieve or sustain profitability,and our business and operating results will be seriouslyharmed.Competition from existing and new products and procedures may decrease our market share and may cause our revenue todecline,and could adversely affect our operating results.The medical device industry,i

308、ncluding the market for the treatment of Afib,is highly competitive,is subject to rapidtechnological change and can be significantly affected by new product introductions and promotional activities.There is noassurance that our products will compete effectively against drugs,catheter-based ablation,

309、implantable devices,other surgicalablation devices,other products or techniques to occlude the left atrial appendage or other products and techniques to manage post-operative pain.Our products may become obsolete prior to the end of their anticipated useful lives,or we may introduce newproducts or n

310、ext-generation products prior to the end of the useful life of our current products,either of which may require us todispose of existing inventory and related capital equipment and/or write off their value or accelerate their depreciation.In addition,other products may be sold at lower prices.Due to

311、 the size of our markets,we anticipate that new or existing competitors maydevelop competing products,procedures and/or clinical solutions.There are few barriers to prevent new entrants or existingcompetitors from developing products to compete directly with ours.Companies also compete with us to at

312、tract qualified scientific,technical and commercial personnel as well as funding.Most of our competitors and potential competitors have greater financial,manufacturing,marketing and research and development capabilities than we have,and may obtain FDA approval or clearance fortheir products.The intr

313、oduction of new products,procedures or clinical solutions,or our competitors obtaining FDA approvals orclearances,may result in price reductions,reduced margins,loss of market share,or may render our products obsolete,which couldadversely affect our revenue and future profitability.Any clinical data

314、 that is generated regarding our products may not be positive,and our current and planned clinical trialsmay not satisfy the requirements of the FDA or other regulatory authorities.Our clinical trials are expensive to conduct,typically taking many years to complete and have uncertain outcomes.Delays

315、 inpatient enrollment or failure of patients to consent or continue to participate in a clinical trial may cause an increase in costs anddelays in the approval and attempted commercialization of our products or result in the failure of the clinical trial.Conductingsuccessful clinical studies may req

316、uire the enrollment of large numbers of clinical sites and patients,and suitable patients may bedifficult to identify and recruit.Patient enrollment in clinical trials and completion of patient participation and follow-up dependson many factors,including the size of the patient population;the nature

317、 of the trial protocol;the attractiveness of,or thediscomforts and risks associated with,the treatments received by enrolled subjects;the availability of appropriate clinical trialinvestigators,support staff,and proximity of patients to clinical sites;and the ability to comply with the eligibility a

318、nd exclusioncriteria for participation in the clinical trial and patient compliance.Our products will be measured on their efficacy.We cannot provide any assurance that the data collected during our clinicaltrials will be compelling to the medical community because it may not be scientifically meani

319、ngful,may identify unexpected safetyconcerns,and may not demonstrate that procedures utilizing our products are an attractive option when compared against data fromalternative procedures and products.Negative data could affect the use of our products and harm our business and prospects.172025/5/19 1

320、2:37atrc-20241231https:/www.sec.gov/Archives/edgar/data/1323885/000132388525000009/atrc-20241231.htm24/88Table of ContentsConversely,positive results from clinical trial experience should not be relied upon as evidence that any of our products willgain market acceptance or that they will satisfy reg

321、ulatory requirements for product approval.There can be no assurance that theresults of studies conducted by collaborators or other third parties will be viewed favorably or are indicative of our own futurestudy results.We may be required to demonstrate with substantial evidence through well-controll

322、ed clinical trials that our productsare either(i)safe and effective for use in a diverse population for their intended uses or(ii)are substantially equivalent to predicatedevices under section 510(k)of the Food,Drug and Cosmetic Act(FDCA).Success in early clinical trials does not mean that futurecli

323、nical trials will be successful because products in later-stage clinical trials may fail to demonstrate sufficient safety and efficacyto the satisfaction of the FDA and other regulatory authorities despite having progressed through initial clinical trials.Our devices and products may not be approved

324、 or cleared even though clinical or other data,in our view,are adequate tosupport an approval or clearance.The FDA or other regulatory authorities may:disagree with our trial design and our interpretation of data from preclinical studies and clinical trials;change requirements for the approval or cl

325、earance of a product even after reviewing and providing comment on a protocol fora pivotal clinical trial;approve or clear a product for fewer or more limited indications or uses than we request;grant approval or clearance contingent on the performance of costly post-marketing clinical trials;ornot

326、approve the labeling claims necessary or desirable for the successful commercialization of our products.These factors would affect the rate and extent to which our products are adopted in the medical community.We rely on independent distributors to market and sell our products in certain markets out

327、side of the United States,and afailure of our independent distributors to successfully market our products or any disruption in their ability to do so mayadversely impact our sales.We depend on independent third-party distributors to sell our products in certain markets outside of the United States,

328、and ifthese distributors do not perform,we may be unable to maintain or increase international revenue.We intend to grow our businessoutside of the United States,and to do so,we may need to attract additional distributors or hire direct sales personnel to expand theterritories in which we sell our p

329、roducts.Independent distributors may terminate their relationship with us or devote insufficientsales efforts to our products.We are not able to control our independent distributors,and they may not be successful in marketingour products.In addition,many of our independent distributors outside of th

330、e United States initially obtain and maintain foreignregulatory approval for sale of our products in their respective countries.Our failure to maintain our relationships with ourindependent distributors outside of the United States,or our failure to recruit and retain additional skilled independent

331、distributorsin these locations,could have an adverse effect on our operations.Turnover among our independent distributors,even if replaced,may adversely affect our short-term financial results while we transition to new independent distributors or direct sales personnel.The ability of these independ

332、ent distributors to market and sell our products could also be adversely affected by unexpected events,including,but not limited to,power failures,nuclear events,local economic and political conditions,natural or other disasters andwar or terrorist activities.In addition,the ability of our independe

333、nt distributors to obtain financing to purchase our products maybe impaired or our independent distributors could experience a significant change in their liquidity or financial condition,all ofwhich could impair their ability to distribute our products and eventually lead to distributor turnover,and may adversely impact oursales.Industry Conditions RisksA prolonged downturn in macroeconomic condi