Dexcom (DXCM) Risk Factor Changes

We are also aware of companies outside the traditional medical device sector that are attempting to develop competitive products and services, including for general health and wellness, or population health.

In addition, the pressure on consumers to absorb more of their own health care costs has resulted in some cases in higher deductibles and limits on durable medical equipment, which may cause seasonality in purchasing…

Climate change may have an adverse impact on our business.

We may communicate certain initiatives and may communicate goals regarding sustainability-related matters (including environmental, social and governance) in our SEC filings or in other public disclosures.

If the conditional conversion feature of the Notes is triggered, holders of the Notes will be entitled to convert the Notes at any time during specified periods at their option.

If we are unable to generate such cash flow, we may be required to adopt one or more alternatives, such as reducing or delaying investments or capital expenditures, selling assets, refinancing or obtaining additional…

Our ability to make scheduled payments of the principal of, to pay interest on or to refinance our indebtedness, including the Notes, depends on our future financial condition and operating performance, which is subje…

In addition, our ability to purchase the Notes or repay prior to maturity any accelerated amounts under the Notes upon an event of default or pay cash upon conversions of the Notes may be limited by law, by regulatory…

In May 2023, we completed an offering of approximately $1.25 billion aggregate principal amount of 0.375% unsecured senior convertible notes due 2028, or the Notes or the 2028 Notes, which offering we refer to as the…

The Amended Credit Agreement imposes numerous financial and other restrictive covenants on our operations, including covenants relating to our general profitability and our liquidity.

In June 2023, we entered into the First Amendment to our Second Amended and Restated Credit Agreement, or the Amended Credit Agreement, with JPMorgan Chase and other syndicate lenders, which amended and restated the c…

We have never declared or paid cash dividends on our capital stock.

Historically, the market price of our common stock, like the securities of many other medical products companies, fluctuates and could continue to be volatile in the future, especially as our business continues to gro…

In 2021, the OECD announced the OECD/G20 Inclusive Framework on BEPS which agreed to a two-pillar solution to address tax challenges arising from digitalization of the economy and released Pillar Two Model Rules defin…

There is growing pressure in many jurisdictions, including the United States, and from multinational organizations such as the OECD and the EU to amend existing international tax rules in order to render them more res…

We are subject to taxes in the United States and numerous international jurisdictions, where a number of our subsidiaries are organized.

As changes in our business environment occur we have adjusted, and may further, adjust our business strategies to meet these changes and we may otherwise decide to further restructure our operations or particular busi…

proceeds through the private sale of our convertible notes, we could require funds to continue the commercialization of our current products and to develop and commercialize future products or pursue other strategic i…

We depend to a significant degree on our senior management, especially Jake Leach, our President and Chief Executive Officer.

Our marketing, promotional and educational materials and practices are subject to FDCA, Federal Trade Commission Act, and other applicable laws and regulations, as may be amended from time to time.

To protect our proprietary rights, we may in the future need to assert claims of infringement against third parties.

Any adverse determination in litigation or interference proceedings to which we are or may become a party relating to patents or other intellectual property rights could subject us to significant liabilities to third…

Third parties have asserted in the past, and may assert in the future, infringement or misappropriation claims against us with respect to our current or future products.

The ACA imposes certain stringent compliance, recordkeeping, and reporting requirements on companies in various sectors of the life sciences industry, and enhanced penalties for non-compliance.

In November 2020, the OIG published a Special Fraud Alert addressing manufacturer Speaker Programs, signaling both a more narrow government view of AKS compliance with respect to such programs as well as the potential…

During the period in which we directly billed Medicare, our financial relationships with referring physicians and their immediate family members were required to comply with the federal Physician Self-Referral law, co…

by a safe harbor, but nevertheless we do not believe them to present a significant risk to beneficiaries or federal healthcare programs and, as such, appear unlikely to invite government scrutiny or prosecution, warra…

Even if approved or cleared by the FDA or international regulatory agencies, future generations of our CGM systems, expanded indications for use of current and future generation CGM systems, our software platforms or…

The FDA, CMS, OIG, OCR, FTC, Department of Justice, states’ attorneys general and other governmental authorities actively enforce the laws and regulations discussed above.

These laws and regulations are extremely complex and, in many cases, still evolving.

Additionally, in response to the onset of the COVID-19 pandemic, we modified our business practices and initially implemented telework policies for certain categories of “non-essential” employees to the extent possible.

For instance, in the EU, increasingly stringent data protection and privacy rules that have and will continue to have substantial impact on the use of patient data across the healthcare industry became effective in Ma…

Additional data protection laws exist at the state level as well.

In the ordinary course of our business, we collect and store sensitive data, such as our proprietary business information and that of our clients, contractors, vendors and others as well as personally identifiable inf…

We conduct limited commercial and marketing efforts in certain international markets in the Asia-Pacific, North America and Europe, Middle East and Africa regions, with respect to our CGM systems and may seek to marke…

Several companies are developing and/or commercializing products for continuous or periodic monitoring of glucose levels in the interstitial fluid under the skin that compete directly with our products.

In selling our G6, G7, G7 15 Day, Dexcom One and Dexcom ONE+, we compete directly with the Diabetes Care division of Abbott Laboratories; Medtronic (MiniMed); Roche Diabetes Care, a division of Roche Diagnostics; priv…

We have also entered into distribution arrangements to leverage existing distributors (including wholesalers) already engaged in the distribution of drugs, devices and/or products in the diabetes marketplace.

We manufacture the majority of our products and procure important third-party services, such as sterilization services, at numerous facilities worldwide.

If we experience manufacturing difficulties or disruptions, it could result in insufficient inventory, increased costs, immediate shortages in product or component supply, and decreased sales, any of which may harm ou…

destroy or limit our manufacturing equipment, inventory, or records and cause us to incur additional expenses.

Our products require multiple manufacturing processes and steps.

Our ability to scale manufacturing capacity is subject to numerous risks and uncertainties, and may lead to variability in product quality or reliability, increased construction timelines, as well as resources require…

We have experienced manufacturing and inventory challenges for G7 in the past that resulted in disruptions in our ability to supply certain markets, including in the U.S.

If we obtain regulatory approval to market and sell a product, the FDA or a foreign regulatory authority may still impose significant restrictions on the indicated uses or how the product may be marketed, or may conta…

The potential effect of the warning letter and these other events can in some cases be difficult to quantify and could harm our reputation and cause our product sales and profitability to suffer.

Compliance with ongoing regulatory requirements can be complex, expensive and time-consuming.

We and certain of our suppliers are also required to comply with the FDA’s Quality System Regulation, or QSR, which as stated above is being superseded by the new QSMR, and other regulations which cover the methods an…

If we or our suppliers or distributors fail to comply with ongoing regulatory requirements, including responding to the FDA warning letter, or if we have unanticipated problems with our products, the products could be…

unable to do so, we may not be able to generate product revenue from our international sales efforts.

In addition to the risks outlined above, our CGMs are more invasive than many other self-monitored glucose testing systems, including single-point finger stick devices, and people with diabetes and those seeking to op…

•our G6 and G7 systems prompt the user to replace the sensor no later than the tenth day, and our G7 15 Day prompts the user to replace the sensor no later than the fifteenth day, which might make it expensive for users;

commercialization of, our next-generation CGM systems, we expect most patients will migrate onto those systems.

Many of the companies that we collaborate with are also competitors or potential competitors who may decide to terminate our collaborative arrangement.

In addition, the change in presidential administration in 2025 has caused and may continue to cause shifts in health policy priorities, including potential impacts on Medicare coverage and reimbursement.

United States, existing single-point finger stick devices used by people with diabetes are generally reimbursable for all or part of the product cost by Medicare or other third-party payors, which may be perceived as…

cost containment efforts are not offset by greater patient access to our products, our revenue may be reduced and our business may be harmed.

We have experienced, and anticipate that we will continue to experience, decreasing prices for our products due to future reimbursement changes under Medicare and pricing pressure from managed care organizations and o…

In addition, the pressure on consumers to absorb more of their own health care costs has resulted in some cases in higher deductibles and limits on durable medical equipment, which may cause seasonality in purchasing…

We may communicate certain initiatives and, in the future, may communicate goals regarding sustainability-related matters (including environmental, social and governance) in our SEC filings or in other public disclosu…

If the conditional conversion feature of the Notes is triggered, holders of the Notes will be entitled to convert the Notes at any time during specified periods at their option.

Our ability to make scheduled payments of the principal of, to pay interest on or to refinance our indebtedness, including the Notes, depends on our future financial condition and operating performance, which is subje…

In addition, our ability to purchase the Notes or repay prior to maturity any accelerated amounts under the Notes upon an event of default or pay cash upon conversions of the Notes may be limited by law, by regulatory…

There is also a risk that due to regulatory changes or changes to federal or state law, such as suspensions on the use of NOLs, or other unforeseen reasons, our existing NOLs could expire or otherwise be unavailable e…

objectives, including the commercialization of our current products and the development and introduction of additional products.

materials or activities to constitute improper promotion of an unapproved use, which could result in significant fines or penalties under other statutory authorities, such as laws prohibiting false claims for reimburs…

licenses could prevent us from manufacturing and selling our products, which would have a significant adverse impact on our business.

reimbursement rates for our products and changes that may be proposed or implemented by the current or future laws or regulations.

As 2025 ushers in a new presidential administration, we expect material changes in health policy, enforcement initiatives, and coverage and reimbursement for health care items and services.

During the period in which we directly billed Medicare, our financial relationships with referring physicians and their immediate family members were required to comply with the federal Physician Self-Referral law, co…

inventory to excess or obsolescence charges, which could have an adverse effect on our business, financial condition and operating results.

such laws, and potentially be awarded a share of any damages or penalties ultimately awarded to the applicable government body.

We rely on information technology and telephone networks and systems, including the Internet, to process and transmit sensitive electronic information and to manage or support a variety of business processes and activ…

For instance, in the European Union, increasingly stringent data protection and privacy rules that have and will continue to have substantial impact on the use of patient data across the healthcare industry became eff…

contracting, and could disrupt our business, and result in a material adverse effect on our business, financial condition, and results of operations.

either party upon short notice.

Our ability to scale manufacturing capacity is subject to numerous risks and uncertainties, and may lead to variability in product quality or reliability, increased construction timelines, as well as resources require…

In addition to the risks outlined above, our G6, G7, Dexcom One, and Stelo systems are more invasive than many other self-monitored glucose testing systems, including single-point finger stick devices, and people with…

Many of the companies that we collaborate with are also competitors or potential competitors who may decide to terminate our collaborative arrangement.

government insurance programs could significantly influence the purchase of healthcare services and products and may result in lower prices for our products or the exclusion of our products from reimbursement programs.

In the United States and other countries, government and private sector access to health care products continues to be a subject of focus, and efforts to reduce health care costs are being made by third-party payors.

all, we could experience adverse regulatory consequences and/or our reputation, business, financial performance and growth could be adversely affected.

will depend on the capital markets and our financial condition at such time.

ability to borrow funds in the future may be restricted or eliminated.

The 2025 Share Repurchase Program could affect the price of our common stock and increase the volatility thereof.

In April 2025, our Board of Directors authorized and approved a share repurchase program of up to $750.0 million of our outstanding common stock, with a repurchase period ending no later than June 30, 2026, or the 202…

We cannot guarantee that the 2025 Share Repurchase Program will be fully consummated or that such program will enhance the long-term value of our share price.

common stock, if any, upon conversion of their notes) may only receive a return on their investment in our common stock if the market price of our common stock increases.

There is also a risk that due to regulatory changes or changes to federal or state law, such as suspensions on the use of NOLs, or other unforeseen reasons, our existing NOLs could expire or otherwise be unavailable e…

changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, and changes in tax laws or their interpretation, both in and outside the…

including investments in the international expansion of our sales efforts and the build-out of our manufacturing facility in Malaysia and the construction of a new facility in Ireland.

Our operations have consumed substantial amounts of cash since inception.

of such litigation.

under the settlement agreement for periods of time which vary depending on the relevant patents or patent applications.

We have been involved in various patent infringement actions in the past and in 2024, we entered into a settlement and license agreement with Abbott to settle all pending patent infringement legal proceedings brought…

products and to promote use of our products, and which may in turn lead to decreased product sales and negatively impact our business, financial condition and results of operations.

We train and educate employees and marketing representatives on the Anti-Kickback Statute and their obligations thereunder, and we endeavor to comply with the applicable safe harbors.

and onerous, further contributing to the risk that we could be found to be out of compliance with particular requirements.

Moreover, we are subject to various operational, compliance, and reputational risks associated with our adoption and utilization of AI technologies, including inaccurate or unpredictable outputs, such as errors or hal…

information, limited ability to restore the systems in the event of a systems failure or interruption, greater risk of a security breach resulting in destruction, alteration or misuse of valuable information, includin…