Heartflow, Inc.

Our existing facilities will continue to support our production, research and development, finance, marketing, and administrative teams. We believe that our existing and new facilities are adequate to support our expansion through the end of the facilities’ lease periods. We believe that suitable additional or alternative space would be available in the future as required on commercially reasonable terms.

• We depend on our talent to grow and operate our business, and if we are unable to hire, integrate, develop, motivate and retain our personnel, including highly qualified, technical personnel, we may not be able to grow effectively and this could adversely affect our business.
• If we fail to properly manage our future growth, our business could suffer.
• Our business could be disrupted by catastrophic events.
• Consolidation among healthcare providers could have an adverse effect on our business, financial condition, results of operations and prospects.
• We may acquire other companies, solutions or technologies, which could divert our management’s attention, result in additional dilution to our stockholders and otherwise disrupt our operations and adversely affect our operating results.
• Sales to customers outside the United States or with international operations expose us to risks inherent in international sales.
• If we do not obtain and maintain international regulatory registrations, clearances or approvals for our Heartflow Platform, we will be unable to market and sell our products outside of the United States.
• Risks Related to Data Privacy and Information Technology
• Failure to comply with laws and regulations affecting the transmission, security and privacy of personal information (including health information) could result in significant penalties.
• We depend on our information technology systems, and any failure of these systems could harm our business and adversely affect our business and operating results.
• We rely upon AWS to operate our cloud offering; any disruption of or interference with our use of AWS would adversely affect our business, results of operations and financial condition.
• If we fail to offer high quality customer support, our business and reputation could suffer.
• We invest significantly in research and development, and to the extent our research and development investments do not translate into new products, features or improvements to our current products, or if we do not use those investments efficiently, our business, financial condition, results of operations and prospects would be harmed.
• Our networks and those of our third-party service providers may become the target of bad actors or security breaches that we cannot anticipate or successfully defend, which could have an adverse impact on our business.
• Risks Related to Legal and Regulatory Matters
• We face extensive regulatory requirements to bring our products to market, and our failure to receive and maintain regulatory clearances or approvals of our current and future products in the United States or abroad or to comply with medical device regulatory requirements could adversely affect our business.
• Healthcare policy changes, including recently enacted legislation reforming the U.S. healthcare system could have an adverse effect on our business, financial condition, results of operations and prospects.
• We are subject to many laws and governmental regulations affecting our marketed products, both domestically and internationally, and any adverse regulatory action may adversely affect our business, financial condition, results of operations and prospects.
• Delays in the commencement or completion of future or ongoing clinical testing could result in increased costs to us and delay our ability to market the Heartflow Platform for additional indications.
• Interim, “top-line” and preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data.
• We may face product liability claims that could result in costly litigation and significant liabilities. We may not be able to maintain adequate product liability insurance.
• The Heartflow Platform may be subject to recalls, which could be costly and could harm our reputation and business.
• Off-label or other unlawful promotion of our products could result in costly investigations and sanctions from the FDA and other regulatory bodies.
• We are subject to numerous federal, state and foreign healthcare fraud and abuse, compliance, transparency and privacy laws and regulations, and a failure to comply with such laws and regulations could have an adverse effect on our business; similarly, an investigation, inquiry or audit by a government agency that alleges violations of law or regulation may have an adverse effect on our business.
• We are subject to U.S. and foreign anti-corruption and anti-money laundering laws with respect to our operations and non-compliance with such laws can subject us to criminal and/or civil liability and harm our business.
• We are subject to governmental export and import controls that could impair our ability to compete in international markets due to licensing requirements and subject us to liability if we are not in compliance with applicable laws.
• Any future litigation against us could be costly and time-consuming to defend.
• Risks Related to Our Intellectual Property
• If we are unable to obtain and maintain sufficient intellectual property rights, or the scope of our rights is not sufficiently broad, third parties could develop and commercialize technology and products similar or identical to ours, and our ability to successfully commercialize our technology and products may be adversely affected.
• If we are unable to protect the disclosure and use of our confidential information and trade secrets, the value of our products and technologies and our business and competitive position could be harmed.
• Reliance on third parties requires us to share our trade secrets, which increases the possibility that a competitor will discover them or that our trade secrets will be misappropriated or disclosed to others.
• Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for noncompliance with these requirements.
• Changes in patent law, precedents and policies in the United States and other jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our products.
• We may not be able to adequately protect our intellectual property rights throughout the world.
• We may be involved in lawsuits to protect or enforce our patents or other intellectual property, or the patents of our licensors, which could be expensive, time consuming and unsuccessful.
• We may be subject to claims challenging the inventorship or ownership of our patents and other intellectual property rights or alleging that we have violated the intellectual property rights or other proprietary rights of third parties.
• The terms of our patents may not be sufficiently long to effectively protect our products and business.
• If we do not obtain additional protection under the Hatch-Waxman Amendments or similar foreign legislation, our business may be materially affected.
• Open-source software licenses often impose unanticipated or unclear restrictions on us or could expose us to litigation, and using open-source software has inherent risks, any of which could impair our ability to successfully commercialize the Heartflow Platform.
• Intellectual property rights do not necessarily address all potential threats to our competitive advantage.
• Risks Related to Financing and Tax Matters
• We may require additional capital to support business growth, and this capital might not be available on terms favorable to us, or at all, and may dilute ownership of our common stock for our stockholders.
• Our operating results may fluctuate significantly, which makes our future operating results difficult to predict and could cause our operating results to fall below expectations or any guidance we may provide.
• We are subject to risks associated with currency fluctuations, and changes in foreign currency exchange rates could impact our results of operations.
• Our ability to use our net operating losses and tax credits to offset future taxable income and taxes may be subject to certain limitations.
• Our international operations subject us to potentially adverse tax consequences.
• Our effective tax rate may vary significantly from period to period.
• Taxing authorities may successfully assert that we should have collected or in the future should collect sales and use, value added or similar taxes, and we could be subject to tax liabilities with respect to past or future sales, which could adversely affect our results of operations.
• Risks Related to Our Common Stock
• There may not be a sustainable trading market for our common stock.
• The market price of our common stock may be volatile, which could cause the value of your investment to decline and could result in substantial losses for investors.
• We are an emerging growth company, and the reduced reporting requirements applicable to emerging growth companies could make our common stock less attractive to investors.
• We incur increased costs and are subject to additional regulations and requirements as a result of becoming a public company, which could lower our profits or make it more difficult to run our business.
• If we are unable to design, implement and maintain effective internal control over financial reporting in the future, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our common stock may decline.
• Our disclosure controls and procedures may not prevent or detect all errors or acts of fraud.
• If our estimates or judgments relating to our critical accounting policies are based on assumptions that change or prove to be incorrect, our operating results could fall below our publicly announced guidance or the expectations of securities analysts and investors, resulting in a decline in the market price of our common stock.
• Our principal stockholders and management own a significant percentage of our stock and will be able to exert significant control over matters subject to stockholder approval.
• Our amended and restated certificate of incorporation provides that the Court of Chancery of the State of Delaware (or, if such court does not have jurisdiction, Delaware federal district court) is the exclusive forum for certain disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.
• General Risk Factors
• We have broad discretion in the use of net proceeds to us from our IPO and may not use them effectively.
• We do not intend to pay dividends in the foreseeable future. As a result, your ability to achieve a return on your investment will depend on appreciation in the market price of our common stock.
• If our operating and financial performance in any given period does not meet any guidance that we provide to the public, the market price of our common stock may decline.
• If securities or industry analysts issue an adverse or misleading opinion regarding our stock, or if they cease coverage of us or fail to publish reports on us regularly, our stock price and trading volume could decline.
• We may be subject to securities litigation, which is expensive and could divert management attention.
• Provisions in our charter documents and under Delaware law could discourage a takeover that stockholders may consider favorable and may lead to entrenchment of management.