Edwards Lifesciences

“Government and private sector initiatives to limit the growth of health care costs, including price regulation and competitive pricing, coverage and payment policies, comparative effectiveness reviews, technology assessments, increasing evidentiary demands, and managed-care arrangements, are continuing in many geographies where we do business, including the United States, Europe, and Japan. As a result of these changes, the marketplace has placed increased emphasis on the delivery of more cost-effective medical therapies. For example, government programs, private health care insurance, and managed-care plans have attempted to control costs by restricting coverage and limiting the level of reimbursement for procedures or treatments, and some third-party payors require their pre-approval before covering payment of new or innovative devices or therapies that are used by patients.”

Annual report 2025A · The company itself

“Reimbursement schedules regulate the amount the United States government will reimburse hospitals and doctors for the inpatient care of persons covered by Medicare. HHS' Centers for Medicare & Medicaid Services (“CMS”) may also review whether and/or under what circumstances a procedure or technology is reimbursable for Medicare beneficiaries. Changes in current coverage and reimbursement levels could have an adverse effect on market demand and our pricing flexibility.”

Annual report 2025A · The company itself

“The success of many of our products depends upon certain key physicians, research institutions, and hospital systems. We work with leading global physicians and research institutions who provide considerable knowledge and experience. These physicians may assist us as researchers, marketing consultants, product trainers and consultants, inventors, and public speakers.”

Annual report 2025A · The company itself

“In addition, we rely on hospital systems to be able to hire staff and have available facilities, including catheterization laboratories, to perform procedures using our products. With multiple new technologies competing for these facilities, including technologies we develop and introduce in both our TAVR and TMTT product groups, a decision by a hospital system, particularly a large hospital system, not to adequately staff or provide facilities necessary to perform procedures using our products, or a decision to use a competitors’ products instead of ours, has in the past and may continue in the future to meaningfully adversely impact our ability to sell our products, 14 Table of Contents resulting in lower sales and revenue than we forecasted, which could have a material adverse effect on our business, financial condition, and results of operations.”

Annual report 2025A · The company itself

“Government and other third-party payors are increasingly attempting to contain health care costs by limiting both coverage and the level of reimbursement for medical products and services. Reimbursement levels may be decreased in the future.”

Annual report 2025A · The company itself

“The purchasing power of these larger customers has increased, and may continue to increase, causing downward pressure on product pricing. If we are not one of the providers selected by one of these organizations, we may be precluded from making sales to its members or participants. Even if we are one of the selected providers, we may be at a disadvantage relative to other selected providers that are able to offer volume discounts based on purchases of a broader range of medical equipment and supplies.”

Annual report 2025A · The company itself

“We are subject to various federal and foreign laws that govern our domestic and international business practices. For example, in the United States, continued implementation of the Affordable Care Act and the 21st Century Cures Act, or any future legislation, including deficit reduction legislation, could impact medical procedure volumes, reimbursement for our products, and demand for our products or the prices at which we sell our products.”

Annual report 2025A · The company itself

“The medical technologies we create, study, manufacture, and market globally are subject to rigorous regulation and scrutiny by the FDA and various other federal, state, and foreign governmental authorities, including the European Union's European Commission (the “Commission”), which promulgated the European Medical Device Regulation (“EU MDR”). Government regulation applies to nearly all aspects of our products’ lifecycles, including testing, clinical study, manufacturing, transporting, sourcing, safety, labeling, storing, packaging, recordkeeping, reporting, advertising, promoting, distributing, marketing, and importing or exporting of medical devices and products.”

Annual report 2025A · The company itself

“Regulatory agencies may also change policies, adopt additional regulations, or revise existing regulations, each of which could prevent or delay approval or clearance of devices, or could impact our ability to market a previously cleared, approved, or unregulated device. Additionally, the United States federal government has shut down several times in recent years, most recently on October 1, 2025, during which many government agencies, including the FDA, furloughed critical employees and stopped critical activities. A prolonged government shutdown could significantly affect the FDA’s timely review of any regulatory filings or applications we submit, which could result in delays or failures to obtain or maintain regulatory approvals, clearances or to comply with regulatory requirements.”

Annual report 2025A · The company itself

“Table of Contents We are also subject to various United States and foreign laws pertaining to health care pricing, anti-competition, anti-corruption, and fraud and abuse, including prohibitions on kickbacks and the submission of false claims laws and restrictions on relationships with physicians and other referral sources.”

Annual report 2025A · The company itself

“We may incur losses from product liability or other claims that could adversely affect our operating results. Our business exposes us to potential product liability risks that are inherent in the design, manufacture, and marketing of medical technologies. Many of the devices we manufacture and sell are designed to be implanted in the human body for long periods of time.”

Annual report 2025A · The company itself

“We rely extensively on our sales and field clinical specialist personnel who work closely with our customers in hospitals. Field clinical specialists routinely attend procedures where Edwards' products are being used in order to provide guidance on the use of our therapies, thereby enabling physicians and staff to reach expert proficiency and deliver differentiated patient outcomes. In addition to working closely with physicians, nurses, and other clinical personnel, our customers include decision makers such as service line leaders, material managers, biomedical staff, hospital administrators and executives, purchasing managers, and ministries of health.”

Annual report 2025A · The company itself

“We have in the past and are continuing to experience constrained procedure volumes and sales for our products because more products, including Edwards’ own products, are competing for the same facilities and staffing within hospitals.”

Annual report 2025A · The company itself

“If government or other third-party payors decline to reimburse our customers for our products or impose other cost containment measures to reduce reimbursement levels, our ability to profitably sell our products will be harmed. We sell our products and technologies to hospitals and other health care providers, nearly all of which receive reimbursement for the health care services provided to patients from third-party payors, such as government programs (both domestic and outside of the United States), private insurance plans, and managed care programs. The ability of customers to obtain appropriate reimbursement for their products from private and governmental third-party payors is critical to our success.”

Annual report 2025A · The company itself

“Continued consolidation in the health care industry could have an adverse effect on our sales and results of operations. The health care industry has been consolidating, and organizations such as GPOs, independent delivery networks, and large single accounts, such as the United States Veterans Administration, continue to consolidate purchasing decisions for many of our health care provider customers. As a result, transactions with customers are larger and more complex, and tend to involve more long-term contracts.”

Annual report 2025A · The company itself

“Health care cost containment efforts have also prompted domestic hospitals and other customers of medical device manufacturers to consolidate into larger purchasing groups to enhance purchasing power. The medical technology industry has also experienced some consolidation, partly in order to offer a broader range of products to large purchasers. As a result, transactions with customers are larger, more complex, and tend to involve more long-term contracts than in the past. These larger customers, due to their enhanced purchasing power, may have a material impact on product pricing.”

Annual report 2025A · The company itself

“As part of our strategy, we actively manage a portfolio of businesses, technologies, services, and products as well as enter into potential strategic alliances. If we are unable to acquire businesses or technologies or other transactions on a timely basis or at all, we will not be able to execute our strategy and our business and results of operations may be adversely impacted.”

Annual report 2025A · The company itself

“Research and development spending increased approximately 2% year over year, representing approximately 18% of 2025 sales. This increase was primarily the result of significant investments in our transcatheter structural heart programs, including an increase in clinical research for our mitral, aortic, and tricuspid therapies.”

Annual report 2025A · The company itself

“Our continued growth and success depend on our ability to innovate and develop new and differentiated products in a timely manner and effectively market these products. Without timely innovation and development, our products could be rendered obsolete or less competitive because of the introduction of a competitor's newer technologies or changing customer preferences.”

Annual report 2025A · The company itself

“Our use of, or our failure to effectively and timely utilize, emerging technologies, including AI, could adversely impact our business and financial results. We use AI and other emerging technologies in various facets of our operations and our business.”

Annual report 2025A · The company itself

“Sales of our TAVR products represented 74%, 75%, and 77% of our net sales in 2025, 2024, and 2023, respectively.”

Annual report 2025A · The company itself

“Sales of our TMTT products represented 9%, 7%, and 4% of our net sales in 2025, 2024, and 2023, respectively.”

Annual report 2025A · The company itself

“Table of Contents Sales of our surgical tissue heart valve products represented 17%, 18%, and 19% of our net sales in 2025, 2024, and 2023, respectively.”

Annual report 2025A · The company itself

“Problems can arise for a number of reasons, including disruption of facility utilities, equipment malfunction, failure to follow protocols and procedures, raw material problems (including cost volatility and availability), software problems, cybersecurity incidents, or human error.”

Annual report 2025A · The company itself

“The rapid advancement of these technologies entails risks, including potential deficiencies in AI-generated information and increased regulatory, cybersecurity, privacy, intellectual property and data-related risks.”

Annual report 2025A · The company itself

“Failure to protect our information technology infrastructure and our products against cybersecurity attacks, network security breaches, service interruptions, or data corruption could materially disrupt our operations and adversely affect our business and operating results. The operation of our business depends on our information technology systems and the information technology systems of certain of our service providers and suppliers. We rely on our information technology systems to, among other things, effectively manage sales and marketing data, accounting and financial functions, inventory 15 Table of Contents management, product development tasks, clinical data, customer service and technical support functions.”

Annual report 2025A · The company itself

“Cybersecurity attacks can include, but are not limited to, computer viruses, denial-of-service attacks, phishing attacks, ransomware attacks, and other introduction of malware to computers and networks; social engineering or other unauthorized access through the use of compromised credentials; exploitation of design flaws, bugs, or security vulnerabilities; intentional or unintentional acts by employees or other insiders with access privileges; and intentional acts of vandalism by third parties and sabotage. Further, cybersecurity threats and the techniques used in cybersecurity attacks change, develop, and evolve rapidly, including from emerging technologies, such as advanced forms of AI and quantum computing.”

Annual report 2025A · The company itself

“Failure to comply with data privacy and security laws could have a material adverse effect on our business. We are required to comply with increasingly complex and changing legal and regulatory requirements that govern the collection, use, storage, security, transfer, disclosure, and other processing of personal data in the United States and in other countries, which may include, but are not limited to, the Health Insurance Portability and Accountability Act (“HIPPA”), as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, the General Data Protection Regulation (“GDPR”) adopted by the EU and the California Privacy Rights Act (“CRPA”) and the California Consumer Privacy Act, as amended by the CRPA (the “CCPA”). The GDPR imposes stringent EU data protection requirements and provides for significant penalties for noncompliance.”

Annual report 2025A · The company itself

“These include, but are not limited to, conditions impacting inflation, credit and capital markets, interest rates, tax law, including tax rate and policy changes, factors affecting global economic stability, tariffs and the political environment relating to health care.”

Annual report 2025A · The company itself

“Problems can arise for a number of reasons, including disruption of facility utilities, equipment malfunction, failure to follow protocols and procedures, raw material problems (including cost volatility and availability), software problems, cybersecurity incidents, or human error.”

Annual report 2025A · The company itself

“We experience from time to time, and may continue to experience, supply interruptions due to a variety of factors, including: •General economic conditions that could adversely affect the financial viability of our vendors; •Vendors' election to no longer service or supply medical technology companies, including due to the burdens of applicable quality requirements and regulations or for no reason at all; •The limitation or ban of certain chemicals or other materials used in the manufacture of our products; and •Delays, shortages and price increases due to trade or regulatory embargoes.”

Annual report 2025A · The company itself

“Additionally, any significant increases in the cost of raw materials, whether due to inflationary pressure, supply constraints, the imposition of tariffs, regulatory changes, or otherwise, could adversely impact our operating results.”

Annual report 2025A · The company itself

“We experience from time to time, and may continue to experience, supply interruptions due to a variety of factors, including: •General economic conditions that could adversely affect the financial viability of our vendors; •Vendors' election to no longer service or supply medical technology companies, including due to the burdens of applicable quality requirements and regulations or for no reason at all; •The limitation or ban of certain chemicals or other materials used in the manufacture of our products; and •Delays, shortages and price increases due to trade or regulatory embargoes.”

Annual report 2025A · The company itself

“Additionally, any significant increases in the cost of raw materials, whether due to inflationary pressure, supply constraints, the imposition of tariffs, regulatory changes, or otherwise, could adversely impact our operating results.”

Annual report 2025A · The company itself

“These include, but are not limited to, conditions impacting inflation, credit and capital markets, interest rates, tax law, including tax rate and policy changes, factors affecting global economic stability, tariffs and the political environment relating to health care.”

Annual report 2025A · The company itself

“Department of Commerce recently initiated an investigation under Section 232 of the Trade Expansion Act of 1962, as amended, into (among other things) imports of personal protective equipment, medical consumables and medical equipment (including devices), to determine whether they threaten U.S. national security, which further creates policy uncertainty in terms of tariffs. The current tariff environment is dynamic, as the U.S. government has imposed, modified and paused tariffs multiple times since the beginning of 2025. Changes to tariffs and other trade restrictions can be announced at any time with little or no notice. We cannot predict with certainty the future trade policy of the U.S. or other countries.”

Annual report 2025A · The company itself

“Problems can arise for a number of reasons, including disruption of facility utilities, equipment malfunction, failure to follow protocols and procedures, raw material problems (including cost volatility and availability), software problems, cybersecurity incidents, or human error.”

Annual report 2025A · The company itself

“Our business and results of operations may be adversely affected if we are unable to recruit and retain qualified talent or are otherwise unsuccessful in the execution of our management succession plans. Our continued success depends, in large part, on our ability to hire and retain qualified people and execute on our talent management and succession plans, and if we are unable to do so, our business and operations may be impaired or disrupted.”

Annual report 2025A · The company itself

“The legal and regulatory landscape surrounding AI technologies is rapidly evolving and uncertain. The rapid advancement of these technologies entails risks, including potential deficiencies in AI-generated information and increased regulatory, cybersecurity, privacy, intellectual property and data-related risks. Another risk may arise if we are unable to timely utilize AI for technological innovation and business operation efficiency in a manner that is faster and more effective than our competitors. In addition, compliance with new or changing laws, regulations or industry standards relating to AI may impose significant costs on us and limit our ability to effectively develop, deploy or use AI technologies.”

Annual report 2025A · The company itself

“Disruptions can also occur if our manufacturing and warehousing facilities are damaged by earthquakes, hurricanes, volcanoes, fires, and other natural disasters or catastrophic circumstances.”

Annual report 2025A · The company itself

“Climate change, or legal, regulatory or market measures to address climate change, may materially adversely affect our financial condition and business operations. Climate change resulting from increased concentrations of carbon dioxide and other greenhouse gases in the atmosphere could present risks to our future operations from natural disasters and extreme weather conditions, such as hurricanes, tornadoes, seismic events, wildfires, or flooding.”

Annual report 2025A · The company itself

“Currently, the UK’s medical device legislation states that the access for CE-marked medical devices will end on June 30, 2030; however, the UK’s regulatory body, the Medicines and Healthcare products Regulatory Agency (MHRA), has announced it will consult on extending the recognition of CE-marked products indefinitely. In addition, the UK government has put in place legislation to clarify and strengthen the post-market surveillance requirements for medical devices in Great Britain. These measures became effective on June 16, 2025, and aim to facilitate greater traceability of incidents and trends, and to allow the MHRA to act swiftly when needed, supporting better risk management and containment of safety issues to reduce harm.”

Annual report 2025A · The company itself

“Concern over climate change could result in new legal or regulatory requirements designed to mitigate the effects of climate change on the environment. Such laws or regulations may result in increased compliance burdens and costs to meet the regulatory obligations, and it may adversely affect our raw material sourcing, manufacturing operations, and the distribution of our products.”

Annual report 2025A · The company itself

“Summary of Risk Factors The following summarizes the principal risks and uncertainties affecting our business, financial condition, and results of operations.”

Annual report 2025A · The company itself

“We are subject to risks associated with public health crises, including pandemics and epidemics, the timing and effects of which are highly uncertain and difficult to predict, and could disrupt our business and the hospital systems and supply chains in which we operate and result in material adverse impacts on our business, financial condition, and results of operations.”

Annual report 2025A · The company itself

“Certain of our products, including pericardial tissue valves, are manufactured using bovine tissue. Concerns relating to the potential transmission of animal-borne illnesses, including BSE, commonly known as “mad cow disease,” from cows to humans may result in reduced acceptance of products containing bovine materials.”

Annual report 2025A · The company itself

“We follow rigorous sourcing and manufacturing procedures intended to safeguard humans from potential risks associated with diseases such as bovine spongiform encephalopathy (“BSE”). We obtain bovine tissue used in our pericardial tissue valve products only from sources within the United States and Australia, where strong control measures and surveillance programs exist. In addition, bovine tissue used in our pericardial tissue valve products is from tissue types considered by global health and regulatory organizations to have shown no risk of infectibility.”

Annual report 2025A · The company itself

“Global Macroeconomic and Industry Risks We may be adversely impacted by global economic, political and social conditions. We conduct extensive global operations and have been impacted and may continue to be negatively impacted by general global economic, political and social conditions, although we cannot predict the extent to which such conditions may negatively impact our business. These include, but are not limited to, conditions impacting inflation, credit and capital markets, interest rates, tax law, including tax rate and policy changes, factors affecting global economic stability, tariffs and the political environment relating to health care.”

Annual report 2025A · The company itself

“These include, but are not limited to, conditions impacting inflation, credit and capital markets, interest rates, tax law, including tax rate and policy changes, factors affecting global economic stability, tariffs and the political environment relating to health care.”

Annual report 2025A · The company itself

“Most of our replacement heart valves are manufactured from natural tissues harvested from animal tissue as well as fabricated materials. We purchase certain materials and components used in manufacturing our products from external suppliers.”

Annual report 2025A · The company itself

“In 2025, 42% of our net sales were derived outside of the United States through our direct sales forces and independent distributors. Of the total sales outside of the United States, 60% were in Europe, 14% were in Japan, and 26% were in Rest of World.”

Annual report 2025A · The company itself

“Table of Contents In addition, a Mutual Recognition Agreement still under negotiation for the Medical Device Regulation may result in a lack of free movement of medical devices between the EU and Switzerland, may impact our access in the EU and may, ultimately, have a material effect on our business, financial condition, and results of operations.”

Annual report 2025A · The company itself

“Of the total sales outside of the United States, 60% were in Europe, 14% were in Japan, and 26% were in Rest of World.”

Annual report 2025A · The company itself

“We sell our products in approximately 100 countries, including Germany, Japan, France, United Kingdom (“U.K.”), Italy, Canada, China, and Spain.”

Annual report 2025A · The company itself

“In the United States, we sell substantially all of our products through our direct sales forces. In 2025, 58% of our net sales were derived from sales to customers in the United States.”

Annual report 2025A · The company itself