KESTRA MEDICAL TECHNOLOGIES, LTD.

Kestra Medical Technologies, Ltd. operates in the wearable medical device and digital healthcare industry, focused on cardiovascular disease. The company's Cardiac Recovery System platform is anchored by the ASSURE Wearable Cardioverter Defibrillator (WCD), which continuously monitors heart rhythms and delivers defibrillation therapy for patients at elevated risk of sudden cardiac arrest. The global WCD market reached approximately $1.1 billion in 2025, with over 80% of revenues coming from the United States. The WCD market grew in the low to mid-teens in 2025, an acceleration from high single digit growth in recent years. Despite being available for over 25 years, WCD therapy reached just 16% of eligible U.S. patients in 2025. Based on the Medicare reimbursement rate of $3,589 per patient per month and the company's average initial WCD prescription length of 3.4 months, management believes the total annual addressable market in the U.S. for the ASSURE WCD is approximately $10 billion. In select international markets, management estimates an approximately $14 billion total annual market opportunity outside the U.S. as of 2025.

The WCD market has historically been served by a single incumbent commercial product, the LifeVest WCD, marketed by ZOLL Medical, a wholly owned subsidiary of Asahi Kasei Corporation. In May 2025, a new market entrant received FDA approval for an adhesive-based external defibrillator. Management believes the ASSURE WCD is differentiated by its patient-centered design, including comfort, wearability, and low false alarm rates. Primary results from the ACE-PAS study reported a low false alarm rate with only 6% of patients experiencing a false alarm, compared to 46% of patients experiencing a false alarm for the leading competitor's device. The Enhanced ASSURE Detection Algorithm's projected impact is estimated to result in only 3% of ASSURE patients experiencing a false alarm. The ASSURE WCD delivers a 170-joule shock compared to the leading competitor device which delivers a 150-joule shock, and has a minimum defibrillation capacity of 25 shocks.

The company generates revenue primarily by leasing the ASSURE WCD to patients on a month-to-month basis as part of the Cardiac Recovery System platform. Revenue is derived from direct billing of various third-party payors, including Medicare, Medicaid, private payors and other healthcare-related organizations. The company also bills patients for co-insurance payments and deductibles. The company is contracted or enrolled as an in-network healthcare provider with payors currently covering over 290 million lives as of April 30, 2026. The platform also includes digital patient engagement and clinical workflow solutions, including the ASSURE patient application, Kestra CareStation remote patient management platform, Heart Alert Services, and ASSURE Assist.

The ASSURE WCD received FDA approval on July 27, 2021 for adult patients at elevated risk of SCA who are not candidates for, or decline, an ICD. As of April 30, 2026, the ASSURE WCD has protected nearly 40,000 patients since commercial launch. The Cardiac Recovery System platform includes the ASSURE patient application for real-time mobile connectivity, the Kestra CareStation remote patient management platform for alert-based notifications, Heart Alert Services and ASSURE Assist for notifying healthcare providers of significant arrhythmias and facilitating emergency response. In April 2026, the company announced the release of the Enhanced ASSURE Detection Algorithm, a software enhancement designed to further improve rhythm discrimination and reduce unnecessary alarms. In January 2026, the company announced a strategic collaboration with Biobeat Technologies, which has developed the only clinically validated, FDA-cleared cuffless, patch-worn ambulatory blood pressure monitoring device. The company intends to integrate Biobeat's technology into its product portfolio to make ABPM data available for patients prescribed the ASSURE WCD.

The company's commercial team is comprised of approximately 130 direct sales representatives as well as more than 40 sales and clinical support professionals as of April 30, 2026, up from 80 direct sales representatives and 40 sales and clinical support professionals as of April 30, 2025. The direct sales team is supported by a contracted team of over 500 Assure Patient Specialists as of April 30, 2026, up from 300 APSs as of April 30, 2025. The company utilizes a lease business model where certain components of the ASSURE WCD are reused for multiple patients. The company relies on a single or limited number of suppliers for certain components. Both tier-one third-party manufacturing and supplier partners are headquartered in the U.S. and provide products from their facilities based in the U.S. The company utilizes an inventory distribution strategy with a central distribution location and 20 additional strategically located third-party warehouses across the U.S.

The company completed its initial public offering on March 7, 2025 of its Common Shares. As of April 30, 2026, the company had rights to 264 issued U.S. and foreign patents, consisting of 229 issued patents in the U.S., 17 issued patents in the European Union, 8 issued patents in Japan, 5 issued patents in Australia and 5 issued patents in China. Additionally, as of April 30, 2026, the company had 125 pending published and unpublished U.S. and foreign patent applications. The earliest expiry date for issued patents owned or used by the company is in February 2031. The company had over 443 full time team members as of April 30, 2026, substantially all located in the U.S.

The company had net losses of $131.6 million and $113.8 million for the fiscal years ended April 30, 2026 and 2025, respectively. As of April 30, 2026, the company had an accumulated deficit of $651.9 million. The company expects to continue to incur losses for the next several years. The aggregate market value of the company's Common Shares held by non-affiliates, based upon the closing price on October 31, 2025, was approximately $618.7 million.

The company intends to continue to capture share of current WCD prescriptions in the U.S. and expand adoption of the Cardiac Recovery System platform to increase penetration of the U.S. total addressable WCD market. Management believes the total annual addressable market in the U.S. for the ASSURE WCD is approximately $10 billion, based on the Medicare reimbursement rate of $3,589 per patient per month and the company's average initial WCD prescription length of 3.4 months. The company plans to pursue expansion in international markets, with Western Europe as the initial focus due to favorable market dynamics. The goal is to obtain regulatory approvals to begin distributing the ASSURE WCD in certain markets in Western Europe within the next three years. The company estimates that Germany and France include approximately 600,000 WCD-indicated patients. The company is currently planning to pursue CE Mark approval in Europe.

The company intends to build upon its strong base of clinical evidence, including through the ASSURE Patient Registry which as of April 30, 2026 has enrolled approximately 40,000 patients. The company plans to continue payor engagement to broaden coverage and increase reimbursement. The company also intends to innovate its system and bolster its digital healthcare platform and data management capabilities. The company aims to develop advanced capabilities to deliver personalized clinical decision support and expand offerings to a broader range of cardiac patients, including those with previously undiagnosed atrial fibrillation, advanced hypertension, and other cardiac conditions. The company intends to strategically pursue adjacent markets with new product offerings and differentiated services.

The company expects to drive gross profit expansion and operating leverage through supply chain efficiencies and manufacturing process improvements. The company's gross profit is affected by payors' reimbursement rates for the ASSURE WCD, as well as the ability to increase reimbursement realization. The company expects to continue to incur significant expenses related to sales, marketing, product manufacturing and distribution functions.

The company utilizes third-party manufacturing and supply partners to manufacture the ASSURE WCD and its components. The company's tier-one third-party manufacturing and supplier partners also operate facilities in Asia and Europe, equipped with localized manufacturing and reconditioning capabilities to support future international needs. The company employs a rigorous manufacturing and supplier partner assessment, qualification, and selection process. The company's quality assurance program monitors and maintains manufacturing and supplier partner performance through qualification and periodic reviews and audits.

The company expects to continue to make significant investments in research and development activities to advance the Cardiac Recovery System platform and develop next-generation products. The company has a tenured and dedicated research and development team comprised of highly skilled engineers and program managers. The company also has strong software development resources capable of innovating advanced algorithms, user interfaces, and connectivity solutions. The company expects to continue to incur expenses relating to operating as a public company.

The company faces structural headwinds including a limited operating history, a history of net losses, and dependence on the ASSURE WCD for nearly all revenue. The company expects to continue to incur losses for the next several years. The company may need to raise equity or debt financing in the future to support growth plans. Macroeconomic conditions such as inflationary pressure, changes to monetary policy, fluctuations in interest rates, and global recessions could adversely impact demand for products. The company's operating results are subject to seasonality as billings and collections during January and February tend to be lower because of resetting annual patient healthcare insurance plan deductibles.

The company faces execution risks including the need to effectively manage the growth of its sales force and customer service resources. The company's commercial team grew from 80 direct sales representatives as of April 30, 2025 to approximately 130 as of April 30, 2026, and the contracted team of APSs grew from 300 to over 500 during the same period. The company depends on a limited number of third-party suppliers and contract manufacturers, and relies on a single or limited number of suppliers for certain components. The company has limited experience supplying the ASSURE WCD in commercial quantities, having fully commercially launched in August 2022.

The company has a history of net losses, with net losses of $131.6 million and $113.8 million for fiscal years ended April 30, 2026 and 2025, respectively, and an accumulated deficit of $651.9 million as of April 30, 2026, with no assurance of when profitability will be achieved. The company is highly dependent on the ASSURE WCD, which generates nearly all revenue, and any failure to maintain broad adoption by healthcare providers and patients would materially harm the business. The company depends on a limited number of third-party suppliers for components, and any supply interruption could impair the ability to meet demand. The company has identified material weaknesses in internal control over financial reporting, and failure to remediate could impair the ability to produce timely and accurate financial statements. Bain Capital has significant influence over the company, and its interests may conflict with those of other shareholders.

Management's message emphasizes the company's focus on transforming patient outcomes in cardiovascular disease through the Cardiac Recovery System platform, anchored by the ASSURE WCD. Key themes include the large, growing, and underpenetrated WCD market, the highly innovative platform designed to improve patient compliance and healthcare provider adoption, and material investments in infrastructure to support rapid growth and scale. Management highlights the strong and compelling body of clinical evidence, including primary results from the ACE-PAS study announced in November 2025, which enrolled 21,612 patients and reported a 100% successful conversion rate for VT and VF events and an inappropriate-shock rate of 0.0065 per patient-month. Management's strategic priorities for the period ahead include continuing to capture share of current WCD prescriptions in the U.S., expanding adoption of the Cardiac Recovery System platform to increase penetration of the U.S. total addressable WCD market, and pursuing expansion in international markets, with the goal of obtaining regulatory approvals to begin distributing the ASSURE WCD in certain markets in Western Europe within the next three years.