10-K: Femasys Faces Going Concern Doubt Amid Nasdaq Delisting Threat

Femasys Inc. reported continued operating losses and substantial doubt about its ability to continue as a going concern, alongside Nasdaq delisting notices, despite increased sales and product development progress.

Summary

• Femasys Inc. is a biomedical innovator focused on women's health, with a portfolio including FemaSeed (infertility), FemSperm (sperm handling), FemVue (tubal assessment), FemCerv (cervical cancer diagnosis), and FemBloc (permanent birth control).
• The company reported a net loss of $18,627,887 for the year ended December 31, 2025, compared to $18,816,628 in 2024, with an accumulated deficit of $145,826,144.
• Sales increased by 40.8% to $2,293,313 in 2025, primarily driven by $810,000 in FemBloc product sales, which were commercialized in 2025.
• Cash and cash equivalents stood at $9,266,353 as of December 31, 2025, but current funds are only expected to sustain operations into the third quarter of 2026.
• The company received FDA IDE approval for the final phase of its pivotal clinical trial for FemBloc, with enrollment initiated in March 2026.
• FemBloc received CE mark certification in the EU (delivery system in March 2025, blended polymer in June 2025) and regulatory approvals in the UK and New Zealand in August and September 2025, respectively.
• Positive peer-reviewed clinical data for FemBloc showed a 0% pregnancy rate in initial trials (n=0/51), significantly lower than the 6% historical control for surgical sterilization.
• FemaSeed, FDA-cleared for intratubal insemination, demonstrated a 26.3% pregnancy rate per subject (n=10/38) in its pivotal trial, significantly higher than the 7% performance goal for historical IUI.
• The American Medical Association approved a new Category III CPT code for the FemaSeed procedure, effective January 2027.
• Femasys holds an expansive intellectual property portfolio with approximately 228 issued patents globally and maintains in-house manufacturing capabilities with MDSAP and ISO 13485 certifications.
• The company received Nasdaq deficiency notices in May and July 2025 for non-compliance with the minimum Market Value of Listed Securities and minimum bid price requirements, facing a delisting deadline of July 13, 2026.
• A November 2025 financing round included $12 million in senior secured convertible notes (8.5% PIK interest, $0.73 conversion price) and warrants to purchase 49,135,689 shares, with total potential funding of approximately $58 million if all warrants are exercised for cash.
• In March 2026, the company modified the 2025 Notes and related Warrants and issued new Series D-1 Warrants for 16,378,563 shares at an exercise price of $0.58 per share, expiring in March 2029.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this filing with caution due to significant ongoing operating losses, substantial doubt about the company's ability to continue as a going concern, and immediate Nasdaq delisting risks, despite positive product development and sales growth.

Positives

• Sales increased by 40.8% to $2,293,313 in 2025, primarily driven by $810,000 in FemBloc product sales.
• FemBloc received CE mark certification under EU MDR for its delivery system (March 2025) and blended polymer component (June 2025), achieving full system approval in the EU.
• FemBloc also secured regulatory approvals in the UK (August 2025) and New Zealand (September 2025).
• The FDA granted IDE approval for the final phase of FemBloc's FINALE pivotal trial in November 2025, with enrollment commencing in March 2026.
• Initial clinical trials for FemBloc demonstrated a compelling 0% pregnancy rate (n=0/51), significantly lower than the 6% historical control for surgical sterilization, with no serious adverse events reported through five years.
• FemaSeed's pivotal clinical trial showed a 26.3% pregnancy rate per subject (n=10/38) and 17.5% per cycle (n=10/57), significantly exceeding the 7% performance goal for historical IUI.
• The American Medical Association (AMA) approved a new Category III CPT code for the FemaSeed procedure, expected to be effective in January 2027, which may support future reimbursement discussions.
• Strategic distribution partnerships for FemBloc were announced in Spain (March 2025) and France/Benelux region (September 2025).
• Strategic distribution partnerships for FemaSeed and FemVue were announced in Spain (September 2024).
• Partnerships with prominent infertility center conglomerates, including Boston IVF (October 2024), HRC Fertility (December 2024), and CNY Fertility (March 2025), were established for FemaSeed and FemVue.
• The company possesses an expansive intellectual property portfolio with approximately 228 issued patents globally.
• In-house chemistry, manufacturing, and controls (CMC) and device manufacturing capabilities are certified to MDSAP and ISO 13485:2016, and compliant with EU MDR.
• FemSperm product family was made available in August and September 2025, enabling in-office sperm preparation and analysis for gynecologists.

Negatives

• The company has incurred significant operating losses since inception, with an accumulated deficit of $145,826,144 as of December 31, 2025.
• There is substantial doubt about the company's ability to continue as a going concern, as stated by management and the independent registered public accounting firm.
• Current cash and anticipated revenue are only expected to fund operations into the third quarter of 2026, necessitating substantial additional funding for FemBloc's U.S. regulatory approval and commercialization.
• The company received Nasdaq deficiency notices in May 2025 for failing to meet the minimum Market Value of Listed Securities ($35.0 million) and in July 2025 for failing to maintain a minimum bid price ($1.00), with a final delisting deadline of July 13, 2026.
• The November 2025 financing, including convertible notes and warrants, introduces significant potential for dilution to existing stockholders, with approximately 65,694,606 shares issuable upon full conversion/exercise.
• Interest expense increased by 17.9% to $1,891,119 in 2025, while interest income decreased significantly by 82.5% to $101,760.
• Inventory levels increased by $2,693,926 in 2025, posing a risk of write-downs if demand is overestimated.
• The company has limited experience marketing and selling its women-specific medical product solutions, requiring significant expansion of its sales and marketing infrastructure.
• Reliance on a limited number of third-party suppliers for components and sterilizers creates supply chain risks.
• The company's single manufacturing facility in Suwanee, Georgia, poses a risk if damaged or rendered inoperable.
• The ability to use net operating losses (NOLs) and research and development credit carryforwards to offset future taxable income may be limited by Section 382 of the Internal Revenue Code.

Risks

• Incurring significant operating losses since inception and expecting future losses, potentially never achieving or sustaining profitability.
• Needing substantial additional funding and potentially being unable to raise capital when needed, forcing delays or reductions in commercialization or product development programs.
• Substantial doubt about the ability to continue as a going concern.
• Financial results may fluctuate significantly due to various factors, including seasonal variations, product adoption, reimbursement changes, and competition.
• Ability to use net operating losses and research and development credit carryforwards to offset future taxable income may be subject to limitations under Sections 382 and 383 of the Internal Revenue Code.
• Received deficiency notices from Nasdaq relating to non-compliance with continued listing requirements (MVLS and minimum bid price), with a risk of delisting.
• Risks associated with convertible notes and warrants, including significant dilution of common stock and potential inability to satisfy payment obligations at maturity.
• Enrollment and retention of subjects in clinical trials is an expensive and time-consuming process and could be made more difficult or impossible by factors outside control, leading to delays or failures.
• FemBloc, as a late-stage U.S. product candidate, may fail in development or suffer delays that adversely affect its commercial viability or fail to obtain FDA approval.
• Substantial dependence on FDA permission to market the FemBloc system and its failure to gain market acceptance would negatively impact the business.
• The clinical development process required to obtain regulatory approvals is lengthy and expensive with uncertain outcomes, and data is subject to interpretation by regulatory authorities.
• Interim, topline, and preliminary data from clinical trials may change as more data become available and are subject to confirmation, audit, and verification procedures.
• Products may fail to gain increased market acceptance if patients or healthcare practitioners are unwilling to change current practices.
• Inability to achieve and maintain adequate levels of coverage or reimbursement for permanent birth control solution or other products could severely hinder commercial success.
• Third-party payors and healthcare practitioners may require additional clinical data prior to adopting or maintaining coverage of products.
• The training required for healthcare practitioners to use artificial insemination and permanent birth control solutions could reduce market acceptance.
• Competition from other companies, some with longer operating histories, more established products, or greater resources.
• Long-term growth depends on the ability to enhance solutions, expand indications, and develop and commercialize additional products.
• Results of operations could be materially harmed if unable to accurately forecast customer demand and manage inventory.
• Loss or degradation in performance of manufacturing capabilities could have a material adverse effect.
• Reliance on a limited number of third-party suppliers for components and sterilization services.
• Performance issues, service interruptions, or price increases by shipping carriers could adversely affect business.
• Limited experience marketing and selling women-specific medical product solutions.
• Reliance on a direct sales force in North America may result in higher fixed costs and slower ability to reduce costs.
• International business risks, including difficulties in distribution partnerships, increased competition, reduced intellectual property protection, currency fluctuations, and varying regulatory requirements.
• Risk of product liability claims that could be expensive, divert management's attention, and harm reputation.
• Quality of solutions not meeting expectations of healthcare practitioners or patients could adversely affect brand and reputation.
• Risks related to health epidemics and outbreaks disrupting commercialization activities and clinical trials.
• Failure of key information technology systems, processes, or sites, or security/data privacy breaches, could result in additional costs, liabilities, and disruption.
• Facilities could become damaged or inoperable, disrupting research, development, manufacturing, and supply.
• Ability to maintain competitive position depends on attracting and retaining senior management and other highly qualified personnel.
• Difficulties in managing organizational growth.
• Extensive government regulation and oversight, with failure to comply leading to enforcement actions.
• Misuse or off-label use of products may harm reputation, result in injuries, or lead to costly investigations and sanctions.
• Products may cause or contribute to adverse medical events or be subject to failures/malfunctions requiring reporting to the FDA, with failure to do so leading to sanctions.
• Failure to obtain and maintain international regulatory registrations or approvals.
• Legislative or regulatory reforms in the United States or the European Union may make it more difficult and costly to obtain approvals or to manufacture, market, or distribute products.
• Business involves the use of hazardous materials, requiring compliance with environmental laws and regulations.
• Subject to anti-bribery, anti-corruption, anti-money laundering, export control, customs, and sanctions laws.
• Inability to adequately protect intellectual property rights or accusations of infringing on others' intellectual property rights.
• Obtaining and maintaining patent protection depends on compliance with various governmental requirements, with noncompliance potentially reducing or eliminating patent protection.
• Litigation or other proceedings or third-party claims of intellectual property infringement could require significant time and money and prevent product development/sales.
• Inability to enforce intellectual property rights throughout the world due to varying laws.
• Third parties may assert that employees or consultants have wrongfully used or disclosed confidential information or misappropriated trade secrets.
• Recent changes in U.S. patent laws could diminish the value of patents in general.
• Patent terms may be inadequate to protect competitive position for an adequate amount of time.
• Trademarks or trade names denied by regulatory authorities or not adequately protected could harm name recognition.
• Reduced disclosure requirements as a smaller reporting company and emerging growth company may make common stock less attractive to investors.
• Anti-takeover provisions in charter documents and under Delaware law could make an acquisition more difficult.
• Significant costs incurred as a public company.
• Obligation to develop and maintain proper and effective internal controls over financial reporting, with failure potentially affecting investor confidence.
• Disclosure controls and procedures may not prevent or detect all errors or acts of fraud.
• Exclusive forum provisions in charter documents could limit stockholders' ability to obtain a favorable judicial forum.
• No anticipated cash dividends on capital stock in the foreseeable future, making capital appreciation the sole source of gain.
• Adverse developments affecting the financial services industry could adversely affect business operations and financial condition.
• Unfavorable global economic conditions could adversely affect business.
• Employees, independent contractors, consultants, commercial partners, collaborators, and vendors may engage in misconduct or other improper activities.
• Inadequate funding for the FDA, SEC, and other government agencies, including from government shutdowns, could hinder their ability to perform normal business functions.
• Compliance with ever-evolving federal, state, and foreign laws relating to handling of information about individuals involves significant expenditure and resources, with failure resulting in significant liability.
• Bearing the risk of warranty claims on products.

Future Outlook

The company expects to continue incurring operating losses for the foreseeable future and needs substantial additional funding beyond Q3 2026 to complete the U.S. development and EU commercialization of its FemBloc product candidate. Future capital requirements depend on clinical trial costs, regulatory reviews, sales and marketing expansion, manufacturing capabilities, and intellectual property protection. The company plans to continue investing in R&D for product enhancements and new offerings, aiming to become a global leader in women's health by disrupting large market segments.

Management Comments

• Our goal is to become a global leader in womens health providing safe and effective solutions that have the potential to disrupt and grow the market segments that they address.
• Our experienced leadership team with concentrated development and execution expertise has an unwavering commitment to advancing womens health.

Industry Context

StockSavvy.ai notes that Femasys operates in a highly competitive biomedical industry, targeting large, underserved markets in reproductive health (infertility and permanent birth control). The company aims to disrupt traditional surgical and pharmaceutical solutions with in-office, non-invasive devices. The market for permanent birth control is dominated by surgical tubal ligation, while artificial insemination is largely served by IUI and expensive IVF. Femasys's strategy positions it against established players like Cook Medical, Cooper Surgical, and MedGyn in infertility, and aims to create a new non-surgical category for permanent birth control. The company's focus on in-office procedures and lower costs could address significant market penetration issues in both segments.

Comparison to Industry Standards

• FemBloc aims to be the first non-surgical, non-implant permanent birth control solution, offering significant advantages over surgical sterilization (tubal ligation) by reducing risks (infection, bleeding, organ injury, anesthesia, death) and costs (likely half the overall cost), while providing an in-office alternative. This contrasts with previous non-surgical implants like Essure (marketed by Bayer), which was removed due to safety concerns, highlighting FemBloc's potential to fill a critical market gap.
• FemaSeed offers a revolutionary alternative to traditional intrauterine insemination (IUI) by precisely delivering sperm directly into the fallopian tube, the natural site of conception. Its pivotal trial demonstrated a 26.3% pregnancy rate per subject, significantly higher than the 7% performance goal based on historical IUI controls, suggesting improved efficiency, particularly for male-factor infertility. This positions FemaSeed as a more affordable, less burdensome, and lower-risk first step compared to in vitro fertilization (IVF), which can cost $15,000 to $30,000 per cycle with typical effectiveness around 25%.

Management Changes

Corporate Governance

Legal Proceedings

• The company is not currently a party to any legal proceedings whose outcome is believed to have a material adverse effect on its business, operating results, or financial condition.
• The company has received, and may continue to receive, letters from third parties alleging patent infringement, violation of employment practices, or trademark infringement.
• The company may participate in future litigation to defend itself against such disputes, which could divert management time and attention and incur financial costs.

Related Party Transactions

• In November 2023, the company issued a $5 million convertible note and Series A and Series B Warrants to PharmaCyte Biotech, Inc. Joshua Silverman, who served as interim CEO, President, and Director of PharmaCyte, was also on Femasys's board until March 2026.
• In November 2024, Femasys paid PharmaCyte $300,000 in accrued interest on the convertible note through the issuance of 315,790 common shares.
• In November 2025, Femasys paid PharmaCyte an additional $300,000 in accrued interest through the issuance of 379,747 common shares.
• The $5 million principal balance of the convertible note to PharmaCyte was repaid at maturity in November 2025.
• In the June 2025 financing, certain executive officers and a director purchased an aggregate of 98,040 shares of common stock in a private placement at $1.02 per share, totaling $100,001.
• In the August 2025 financing, certain executive officers purchased 87,363 common shares with common warrants at a combined price of $0.5151, totaling $45,001.
• In the November 2025 financing, certain executive officers and a director purchased senior secured convertible notes with a combined principal balance of $100,000, convertible into common shares at $0.73 per share, and received related Series A-1, B-1, and C-1 Warrants.
• A family member of the CEO was employed by the company and earned total cash compensation of $196,000 in 2025 and $168,000 in 2024, consistent with market standards for comparable positions.

Stakeholder Impact

• Shareholders face significant dilution risk from recent and potential future capital raises, including convertible notes and warrants. The ongoing Nasdaq delisting threats due to non-compliance with listing requirements could negatively impact share price and liquidity. Continued operating losses and substantial doubt about the company's ability to continue as a going concern pose a high risk to investment value, with capital appreciation being the sole source of gain as no dividends are anticipated.
• Employees are critical to the company's success, and its ability to attract, retain, and motivate highly qualified talent is essential for growth. The company's expansion plans will require additional managerial, operational, sales, marketing, financial, and other personnel. Stock-based compensation is used as an incentive to align employee interests with company performance.
• Customers, including healthcare practitioners and patients, stand to benefit from the company's innovative products like FemBloc and FemaSeed, which aim to address unmet needs in reproductive health by offering safer, more accessible, and cost-effective in-office alternatives to existing surgical or pharmaceutical solutions. Market acceptance will depend on the perceived clinical benefits, ease of use, and availability of adequate reimbursement.
• Suppliers and creditors are impacted by the company's reliance on a limited number of third-party suppliers for critical components and sterilization services, which introduces supply chain risks. The company's debt obligations, including senior secured convertible notes, represent a financial commitment to creditors, with the company's ability to meet these obligations dependent on future operational performance and financing.

Next Steps

• Complete the FINALE pivotal trial for FemBloc and file a Premarket Approval (PMA) application with the FDA.
• Obtain U.S. regulatory approval for the FemBloc system for permanent birth control.
• Expand the direct sales organization in the United States to support commercialization of FemaSeed and FemBloc.
• Continue to invest in research and development activities focused on improvements and enhancements to FemaSeed and FemBloc, and additional women-specific medical products.
• Increase healthcare practitioner and patient awareness for FemaSeed and FemBloc through engagement and scientific data publication.
• Expand in-house manufacturing capabilities and evaluate potential outsourcing arrangements to meet scaling demand.
• Monitor the safety and performance of FemBloc in real-world settings through a post-market surveillance (PMS) clinical study in the EU, complying with MDR framework.
• Pursue Category I Current Procedural Terminology (CPT) codes for the FemBloc procedure in the United States.
• Work with payors in select international countries and regions to pursue appropriate coverage and reimbursement approvals for FemBloc.
• Actively monitor the closing bid price of common stock and consider all available options, including a reverse stock split, to regain Nasdaq compliance by July 13, 2026.
• Assess the impact and adopt ASU 2024-03 (Disaggregation of Income Statement Expenses) for annual reporting periods beginning after December 15, 2026.
• Assess the impact and adopt ASU 2025-11 (Interim Reporting) for interim periods in annual reporting periods beginning after December 15, 2027.

Key Dates

Recommendation

The company faces severe financial distress, evidenced by recurring significant operating losses, a substantial accumulated deficit, and explicit 'substantial doubt about our ability to continue as a going concern.' Immediate Nasdaq delisting threats due to non-compliance with listing requirements add significant uncertainty and risk to shareholder value. While product development shows promise, the urgent need for substantial additional capital, coupled with the high potential for further shareholder dilution from existing and future financing instruments, outweighs the positive clinical and commercial developments. The company's ability to secure necessary funding on favorable terms or at all is highly uncertain, making the stock a high-risk investment with significant downside potential.

Keywords

Femasys, Women's Health, Medical Devices, Infertility Treatment, Permanent Birth Control, FemBloc, FemaSeed, FemVue, FemSperm, FDA Approval, Clinical Trials, Reproductive Health, Biomedical Innovation, Nasdaq Listing, Convertible Notes, Warrants, SEC Filing, Financial Reporting, Market Acceptance, Intellectual Property