CYRX US Equity☆

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

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​ For the fiscal year ended December 31, 2021

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​ For the transition period from to .

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Commission File Number: 001-34632

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CRYOPORT, INC.

(Exact Name of Registrant as Specified in its Charter)

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112 Westwood Place, Suite 350

Brentwood, TN37027

(Address of principal executive offices, including zip code)

(949) 470-2300

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

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Securities registered pursuant to Section 12(g) of the Act: Warrants to purchase Common Stock

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes⌧ No ◻

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ◻No⌧

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes⌧ No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes⌧ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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Large accelerated filer ☒ Accelerated filer ◻

Non-accelerated filer ◻ Smaller reporting company ☐

Emerging growth company ◻

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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ◻ No ⌧

The aggregate market value of common stock held by non-affiliates of the registrant as of June 30, 2021 was $1.9 million based on the closing sale price of such common equity on such date (excluding 16,243,910 shares of common stock held by directors and officers, and any stockholders whose ownership exceeds five percent of the shares outstanding as of June 30, 2021).

As of February 18, 2022, there were 49,694,787 shares of the registrant’s common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

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Portions of the registrant’s proxy statement for the 2022 Annual Meeting of Stockholders are incorporated herein by reference in Part III of this Annual Report on Form 10-K where indicated. Such proxy statement will be filed with the U.S. Securities and Exchange Commission within 120 days of the registrant’s fiscal year ended December 31, 2021.

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Table of Contents

TABLE OF CONTENTS

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PART I ​

Item 1. Business 4

Item 1A. Risk Factors 27

Item 1B. Unresolved Staff Comments 41

Item 2. Properties 41

Item 3. Legal Proceedings 41

Item 4. Mine Safety Disclosures 41

PART II ​

Item 6. [Reserved] 43

Item 7A. Quantitative and Qualitative Disclosures About Market Risk 55

Item 8. Financial Statements and Supplementary Data 56

Item 9A. Controls and Procedures 56

Item 9B. Other Information 57

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 57

PART III ​

Item 10. Directors, Executive Officers and Corporate Governance 59

Item 11. Executive Compensation 59

Item 14. Principal Accountant Fees and Services 59

PART IV ​

Item 15. Exhibits and Financial Statement Schedules 60

Signatures 64

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FORWARD-LOOKING STATEMENTS

References to the “Company,” “Cryoport,” “we,” “us,” “our” and other similar words refer to Cryoport Inc. and its consolidated subsidiaries, unless the context suggests otherwise. This Annual Report on Form 10-K (this “Form 10-K”) contains certain forward-looking statements. These forward-looking statements involve a number of risks and uncertainties. These forward-looking statements can generally be identified as such because the context of the statement will include certain words, including but not limited to, “believes,” “may,” “will,” “expects,” “intends,” “estimates,” “anticipates,” “plans,” “seeks,” “continues,” “predicts,” “potential,” “likely,” or “opportunity,” and also contains predictions, estimates and other forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on the current beliefs of the Company’s management, as well as assumptions made by and information currently available to the Company’s management. Readers of this Form 10-K should not put undue reliance on these forward-looking statements, which speak only as of the time this Form 10-K was filed with the Securities and Exchange Commission (the “SEC”). Reference is made in particular to forward-looking statements regarding our expectations about future business plans, new products or services, regulatory approvals, strategies, development timelines, prospective financial performance and opportunities, including potential acquisitions, expectations about future benefits of our acquisitions, including Cryogene, CRYOPDP and MVE Biological Solutions, our ability to successfully integrate those businesses and our plans related thereto; liquidity and capital resources; projected trends in the market in which we operate; anticipated impacts from the coronavirus strain COVID-19 (“COVID-19”) on us, including to our business operations, results of operations, cash flows, and financial position, and our future responses to the COVID-19 pandemic; our expectations about securing and maintaining strategic relationships with global couriers or large clinical research organizations; our future capital needs and ability to raise capital on favorable terms or at all; results of our research and development efforts; and approval of our patent applications. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. The Company’s actual results may differ materially from the results projected in the forward-looking statements. Factors that might cause such a difference include, but are not limited to, those discussed in this Form 10-K, including the “Risk Factors” in “Part I, Item 1A — Risk Factors”, and in “Part II, Item 7 — Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

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Past financial or operating performance is not necessarily a reliable indicator of future performance, and you should not use our historical performance to anticipate results or future period trends. We can give no assurances that any of the events anticipated by the forward-looking statements will occur or, if any of them do, what impact they will have on our results of operations and financial condition. Except as required by law, we do not undertake to update any such forward-looking statements and expressly disclaim any duty to update the information contained in this Form 10-K.

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PART I

Item 1. Business

Overview

Cryoport Inc. (“Cryoport,” “we,” “our,” or the “company”) is a global leader in serving the life sciences industry as a trusted provider of integrated temperature-controlled supply-chain solutions supporting the biopharma/pharma, animal health, and reproductive medicine markets. Our mission is to support life and health worldwide and we are continuously developing, implementing, and leveraging our supply chain platform, which is designed to deliver comprehensive, unparalleled, highly differentiated temperature-controlled logistics, packaging, storage, cryogenic systems, informatics, and related services for life science products, regenerative medicine, cellular therapies, and treatments that require unique, specialized cold chain management.

Spread across 15 countries and 33 locations worldwide, we serve more than 3,000 customers working in biopharmaceutical, animal husbandry and reproductive medicine companies, universities, research institutions and government agencies. Our platform of solutions together with our global team of more than 850 colleagues delivers a unique combination of innovative supply chain technologies and services through our industry-leading brands, Cryoport Systems, CryoStork®, MVE Biological Solutions, CRYOPDP, and CRYOGENE.

Cryoport’s advanced supply chain platform, comprised of comprehensive and technology-centric systems and solutions, are designed to support the global high-volume distribution of commercial biologic and cell-based products and therapies regulated by the United States Food and Drug Administration (FDA) and other international regulatory bodies for distribution in the Americas, EMEA (Europe, the Middle East, and Africa) and APAC (Asia-Pacific) regions. Cryoport’s solutions are also designed to support pre-clinical, clinical trials, Biologics License Applications (BLA), Investigational New Drug Applications (IND) and New Drug Applications (NDA) with the FDA, as well as global clinical trials initiated in other countries, where strict regulatory compliance and quality assurance is mandated. Over the last several years, we have grown to become a leader in supporting the clinical trials and commercial launches of cell and gene therapies globally. As of the end of the fiscal year of 2021, we supported 602 clinical trials and eight commercial therapies, including KYMRIAH by Novartis, YESCARTA and TECARTUS by Gilead/Kite, and BREYANZI and ABECMA by Bristol-Myers Squibb. A total of eleven (11) Cryoport-supported Biologic License Applications (BLAs) or Marketing Authorization Applications (MAAs) were filed in fiscal year 2021, based on internal information and forecasts from the Alliance for Regenerative Medicine, of which two (2) were filed during the fourth quarter of 2021. Looking forward, we anticipate up to nineteen (19) BLA and MAA submissions for Cryoport-supported products during 2022. Those therapies that receive commercial approval will provide opportunities to become significant revenue drivers for us in the future as the majority of them will require temperature-controlled storage, comprehensive temperature-controlled supply chain support and other services at commercial scale, and we expect that many will select us as their critical supply chain solution as a result of our work in connection with their respective clinical trials and track record in the market.

Cryoport’s advanced supply chain platform also supports the animal health market and the human reproductive market. The animal health market is mainly composed of supporting animal husbandry, as well as companion and recreation animal health. The human reproductive market which is largely composed of In-Vitro Fertilization (IVF) support for patients and clinics.

Our industry standard setting Chain of Compliance® solutions, which include vital analytics, such as ‘chain-of-condition’ and ‘chain-of-custody’ information in a single data stream, empower our clients’ continuous vigilance over their respective commodities. In addition, our Chain of Compliance® standard ensures full traceability of the equipment used and the processes employed during storage, fulfillment, and distribution, further supporting each client’s goal of minimizing risk and maximizing success of their respective new biologics or other products and therapies as they are introduced into the global markets.

As part of our services, our platform of technologies provides the ability for Cryoport personnel, and our clients, to monitor conditions of the internal physical environment, geographic location and other specified critical variables for each shipment or sample in near real time. In accordance with client requirements, information is recorded and archived for each shipment or sample for scientific, quality assurance and regulatory purposes in a secure cloud-based system that can be accessed by authorized personnel globally. This information provides an audit trail that can verify the in-shipment or sample condition in which the life sciences commodity, material, product, vaccine, or therapy was shipped and/or stored.

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One of the most important features of our supply chain solutions platform is our suite of sophisticated, cloud-based, logistics management platforms, which are branded as the Cryoportal® Logistics Management Platform (the “Cryoportal®”), and CRYOPDP UnITy platform, both of which are supported by an integrated control tower. These platforms support the management of shipments through a single interface, which includes order entry, document preparation, customs documentation, courier management, near real-time shipment tracking and monitoring, issue resolution, and regulatory compliance requirements. In addition,they provide unique and incisive information dashboards and validation documentation for every shipment through data collected by the SmartPak TM Condition Monitoring System(s) (the “SmartPakTM”). The Cryoportal® can record and retain a fully documented history of all Cryoport Express® and ELITETM Shippers, including chain-of-custody, chain-of-condition, chain-of-identity, and Chain of ComplianceTM information for each shipment, which is used to ensure that the stability of shipped biologic commodities are maintained throughout the shipping cycle. At the client’s option, recorded information is archived, allowing the client to meet exacting requirements necessary for scientific work and/or proof of regulatory compliance during the logistics process. CRYOPDP’s UnITy transportation management platform contains various modules that include a tracking, order management, asset management, all of which report up to a main control tower to ensure full supply chain visibility and supporting analytics.

Cryoport’s MVE Biological Solutions systems are an important part of our global supply chain platform. MVE Biological Solutions is the leading global manufacturer of temperature-controlled storage and distribution equipment and systems. MVE has set the standard for the manufacture of cryogenic systems including vacuum insulated products and cryogenic freezer and shipper solutions used for storage and/or distribution of critical biological material for more than 50 years. MVE Biological Solutions’ equipment is used extensively throughout the life sciences industry and is the trusted solution within the regenerative medicine space for the storage and distribution of cell and gene therapies. Moreover, Cryoport Systems in conjunction with MVE Biological Solutions are developing a new platform of ultra-low temperature smart packaging for cell and gene therapy distribution through a new purpose built Cryoport ELITETM product line. The first two products in the Cryoport ELITETM line to launch will be the CryosphereTM, which is a first of its kind gravitationally stabilized cryogenic shipper aimed at supporting of cell therapies and a novel ELITETM-80°C shipper, which, is purpose built for the support of gene therapy distribution and upstream viral vector products. Both these products are being launched to complement our current Cryoport Express® and CRYOPDP Temperature Controlled Packaging Solutions.

Our advanced technologies and dedicated personnel allow us to continue to expand our services footprint with a growing suite of services, products and competencies supporting the life sciences industry, which currently include information technology, primary and secondary packaging, analytics, logistics distribution, laboratory relocation, biostorage services, embedded logistics support and validation services (e.g., for shipping lanes and packaging) and consulting services. A sample of our client facing, supply-chain solutions include the following service platforms:

These service platforms have been designed to effectively support, for example, the following use cases:

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Cryoport’s mission is to enable the life sciences to save and improve lives around the world by providing certainty throughout the supply chain – one patient, one therapy, one product at a time. Our people, innovative solutions, and industry leading technologies have been designed to exceed current standards to deliver certainty and de-risk the process across the entire supply chain for the life sciences.

Competitive Advantages

With our first-to-market integrated platform of services, technology-driven supply-chain solutions and decades of experience serving the life sciences industry, we have established a substantial lead over potential competitors. Furthermore, we are not aware of any company that offers services comparable to Cryoport’s full platform of solutions, capabilities, or competencies. Working with our depth of knowledge in information technology, bioservices, packaging, temperature-controlled logistics, and cryogenic systems, our management, technical, business development and service support teams approach our growing markets with adaptability, innovation, and creative thinking.

The most common alternatives to Cryoport’s platform of solutions are “older technologies” and/or systems as well as cobbled together, non-integrated platforms. In fact, a portion of the biopharma market and much of the animal health market still uses liquid nitrogen in its hazard liquid form and/or dry ice with no ongoing validation processes for equipment or procedures. In the case of dry ice, the technology delivers temperatures of approximately -80°C with standard deviations up to 14°C. Consequently, it provides an environment that allows cellular activity to continue and cells to degrade, impacting cell line performance and cell viability. On the other hand, liquid nitrogen, while effective in holding cryogenic temperatures, is bulky, heavy, expensive and requires special handling to avoid spillage and accommodate weight restrictions. Both dry ice and liquid nitrogen are classified “hazardous” by IATA and, therefore, are also classified as “dangerous goods,” requiring additional permits and fees. Cryoport’s cryogenic solutions on the other hand are classified as non-hazardous. Additionally, cobbled together systems with assets and technologies managed by multiple entities introduces gaps in the compliance platform of the offering which in turn creates inherent material risks during the storage, fulfillment, and/or transport processes.

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Through our experience, we know that the logistics distribution process can have a large impact on product/commodity conditions. This is especially important for the high value and at times irreplaceable commodities that we transport, whether in support of a clinical trial or the commercial distribution of a product. We therefore go beyond traditional ISTA (International Safe Transit Association) packaging validation and have implemented Quality-by-Design processes that allow us to assess in-field events, the impact of logistics on the commodity being shipped, and the equipment being used for each individual shipment. With the acquisition of CRYOPDP, Cryoport now has more control and accountability around the logistics distribution which in turn provides better performance and risk management for our clients and their critical therapies.

We have been qualified as a trusted temperature-controlled solutions provider for hundreds of life sciences companies, institutions, and governments and, as of December 31, 2021, supported over 602 clinical trials in the regenerative medicine space. Cryoport and CRYOPDP have logged over 500,000 shipments to over 100 countries with hundreds of different types of life sciences materials in the last 12 months alone. Our experience and reputation, combined with decades of know-how and technology, provides us with significant competitive advantages. As an example, Novartis, Kite Pharmaceuticals Inc. (a subsidiary of Gilead Sciences), Bluebird Bio, Orchard Therapeutics, and Bristol Myers Squibb have all entrusted Cryoport to manage their respective global clinical shipments of gene and cell therapies trials and the commercial shipments of their respective therapies, KYMRIAH®, YESCARTA®, TECARTUSTM, BREYANZI®, ABECMA®, LIBMELDYTM, and ZYNTEGLOTM. Cryoport is now supporting eight commercially approved products in the regenerative medicine space.

Cryoport Systems’ Cryoportal® logistics management platform (“Cryoportal”) is an important backbone technology that is integrated with our partners like FedEx, UPS, DHL, McKesson, Be-The-Match Biotherapies, Lonza, and others. The Cryoportal® handles order entry, keeps track of our global inventory, and provides algorithms for predictive analysis on every shipment while in transit, globally. Our customer service team monitors every shipment 24/7/365 while they are in transit and, by leveraging the Cryoportal, they have the unique ability to see issues that arise and take corrective measures up to and including intervention to save a shipment when needed.

Embedded within the Cryoportal® is the Chain of Compliance®, which is important for regulatory reasons and for risk mitigation. Using our Chain of Compliance®, every Cryoport Express® and ELITETM shipper has its unique ID, every SmartPak® condition monitoring system has a unique ID, everything that is used more than once has a unique ID that is attached to it for its entire life. Thereby, Cryoport personnel can pull any shipper out of our inventory and tell the customer its entire history including every journey it has taken, for whom it was shipped, the contents shipped, the Cryoport shipper’s performance during transit, and the time of its return to a Cryoport Systems Global Logistics facility. It then continues to provide information on who performed the validated cleaning process, who recertified the unite and its components, and who recalibrated the SmartPak®, and who recertified it as being acceptable for its next use. All this traceability is stored in our Cryoportal® for our clients to access at any time. We are unaware of any other company that provides this solution.

In October 2020, we made two acquisitions: CRYOPDP and MVE. The CRYOPDP acquisition, in October 2020, added 25 facilities located in 14 countries to Cryoport bringing us to a total of 33 facilities in 15 countries. Our network of logistics centers provides redundancies for safety and certainty and enables us to be closer to our clients. It is our goal to have facilities within close proximity to global cell and gene manufacturing sites. With the CRYOPDP acquisition we instantly expanded our global network to cover most of the important locations. CRYOPDP and Cryoport Systems have already initiated the process of establishing jointly run facilities when appropriate to provide additional efficiencies and flexibility to our mutual client base. The first facilities that are jointly run include Osaka, Japan, Singapore, and Morris Plains, NJ.

Approximately eight years ago Cryoport Systems outsourced the manufacturing of the Cryoport Express® cryogenic dewars to the MVE, then a division of Chart Industries. At the time, Cryoport selected MVE because we felt that they were the best at cryogenic manufacturing, produced the highest quality products, and could scale to meet our volume requirements over time. By acquiring MVE, Cryoport became vertically integrated with the leading provider of cryogenic systems in the world and we secured one of our primary strategic inventory sources, which assures us of our ability to scale and further develop our Chain of Compliance® .

Today, Cryoport is the leading temperature-controlled supply chain solutions company serving the life sciences industry with a focus on the fast-paced cell and gene therapies market. In regenerative medicine, we support the major share of clinical trials; we support the most commercial therapies; we have a global logistics of network of 33 facilities, and we own the largest cryogenic systems manufacturing company for the life sciences in the world. We are forecasting a record number of regenerative therapies to file for approval this year and the cell and gene market is expected to grow rapidly for the next decade and beyond. We think Cryoport is well positioned to benefit from that growth -- today and for years to come.

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Cryoport Products and Services

Cryoport is known as an industry leader in bringing best-in-class, comprehensive temperature-controlled supply chain solutions to the biopharma, reproductive medicine, and animal health markets. We have been successful in capturing significant market share through the development and implementation of a growing suite of supply-chain solutions with a relentless focus on effective risk management through market leading systems, processes, technology, and informatics systems coupled with excellent customer service in the management of our clients’ irreplaceable commodities. Our suite of market leading products and services include, but are not limited to the following:

Cryoport Express® Shippers - Cryoport Express® Shippers range from liquid nitrogen dry vapor shippers (-150°C) to our C3TM Shippers (2-8°C), which are powered by phase-change materials. The Cryoport Express® Shippers are precision-engineered assemblies that are reliable, cost-effective, and reusable or recyclable. Our liquid nitrogen dry vapor Cryoport Express® Shippers utilize an innovative application of ‘dry vapor’ liquid nitrogen technology and, most often, include a SmartPakTM Condition Monitoring System. Our Cryoport Express® Shippers are purpose built. Cryoport Express® Shippers meet International Air Transport Association (“IATA”) requirements for transport, including Class 6.2 infectious substances. Cryoport Express® Shippers are also International Safe Transit Association (“ISTA”) “Transit Tested” certified and carry the CE (“Conformité Européenne”) mark demonstrating conformance with European Union health, safety, and environmental protection standards.

Cryoport ELITETM Shippers – Cryoport has designed a best-in-class family of -80°C shippers that have superior temperature management properties as well as incorporate next generation protection, handling, and data collection and management systems including our SmartPakTM Condition Monitoring System. The ELITETM shipper line has been developed in conjunction with one of the leaders in the gene therapy space for clinical and commercial gene therapy distribution. The ELITETM shipper platform will be launched in the first half of 2022.

Cryoport CryosphereTM – The Cryosphere is a revolutionary gravitationally stabilized Cryoport Express® Shipper that is expected to be the most advanced cryogenic shipper to support the cell and gene therapy and other life sciences markets. The shipper is designed to passively stabilize the payload through its internal gravitational sphere, thereby keeping the payload in an upright orientation regardless of the external shipper orientation. This innovative technology further mitigates one of the key risks during storage, handling, and transport, which is maintaining constant cryogenic temperatures. In addition, the Cryosphere will have advanced shock and vibration absorption properties to further protect the payload and will be outfitted with Cryoport’s SmartPakTM state-of-the-art condition monitoring systems. It has also been designed to be ergonomically friendly, thus providing a better user experience than other products in the market. The CryosphereTM is expected to be launched during the first half of 2022.

Cryoport Consulting Services – Cryoport Consulting Services functions in an expert advisory capacity to offer solutions to address risk factors present in temperature-controlled supply chain and logistics. To develop tailored scalable solutions, our cross-functional team collaborates with our clients to understand supply chain, logistics, time, shipper and packaging concerns. Consulting Services employs a structured approach to managing, executing, and developing risk mitigation plans. Our clients benefit from our quality driven processes and solutions delivered by our high integrity team leveraging industry-standard best practices and years of experience partnering with leading regenerative medicine companies from early clinical through post-commercialization. Service solutions range from comprehensive physical, thermal and shipping qualifications of shipping systems and/or packaging to developing user-friendly custom packaging solutions focused on the challenges unique to our Regenerative Medicine customers. Our Packaging Center of Excellence is expected to launch in 2022 to better serve our clients in Biopharmaceuticals, Animal Health and Reproductive Medicine by providing state-of-the-art customized packaging, testing, and qualification capabilities.

Cryoport Bioservices – With the upcoming launch of our new Cryoport Supply Chain Centers during the first half of 2022, Cryoport Systems will launch its Bioservices business. The new Cryoport Supply Chain Centers will offer a fully new and integrated approach designed to support cell and gene therapies including comprehensive controlled temperature storage, fulfilment, kit production, secondary packaging, labelling of therapeutic products and GMP raw materials storage along with world class logistics in both Houston, Texas and Morris Plains, New Jersey. In summary, these state-of-the-art facilities will combine our existing logistics processes and capabilities with our new, cutting edge Bioservices infrastructure – all under one roof, as Cryoport’s Global Supply Chain Center Network. Further expansion of the Cryoport Global Supply Chain Center Network is expected to include additional sites in the Americas, EMEA and APAC regions. The addition of these facilities and services provides for our clients’ increasing need for comprehensive and integrated solutions offerings and the expected growth in the global biostorage and bioservices markets, which are driven by the acceleration of clinical trials and the commercialization of regenerative medicine therapies on a global basis.

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CRYOGENE - provides unparalleled solutions for the provision of pre-clinical temperature-controlled biological materials management services to the life science industry. These services include comprehensive specimen storage, processing, collection, and retrieval at our recently expanded CRYOGENE operations in Houston, TX, which is a cGMP-compliant operation.

CRYOPDP Temperature Controlled Logistics - CRYOPDP is a Specialist providing global and innovative temperature-controlled logistics solutions to the Clinical Research and Cell & Gene Therapy Communities. CRYOPDP operates with expertise an exhaustive range of temperature-controlled logistics services including Temperature controlled Packaging and Premium transport solutions from Cryogenic temperature (-196°C to 150°C) to Controlled Ambient (+15°C to +25°C).

CRYOPDP Direct to Patient Solutions - Direct-to-Patient is an innovative solution designed to meet the requirements of decentralized clinical trials, by focusing on the patient and customer-specific needs. This tailor-made solution allows the patients to access their drug therapies in the comfort of their own home, delivering significant benefits for the patient and to all the associated parties, by reducing drop-out rates due to lack of accessibility or time. Direct-to-patient contributes to the increase of study effectiveness and accelerates the publication of study endpoints and marketing authorization.

CRYOPDP Control Tower Solution - A “customer dedicated” end-to-end Control Management and Monitoring Service. The Control Tower ensures the premium execution of the customer predefined processes: from Order to Bill including booking, shipping, delivery. It provides a full supply chain visibility and real-time analytics, to guarantee total real time supervision of all movements at regional or global level, including pro-active incidents resolutions. The unique Global Control Tower Solution enhances CRYOPDP customers' existing logistics planning and execution systems, providing fully customizable solutions guaranteeing on time and under customer specifications performance above 99.9%.

MVE Biological Solutions Fusion Cryogenic Freezers - are the world’s first and only self-sustaining cryogenic freezer. The Fusion can operate as a stand-alone unit and requires no on-going liquid nitrogen supply or connection to and external liquid nitrogen source. Fusion freezers are a perfect solution for remote geographic locations, isolated laboratories, high elevation facilities, or facilities without existing liquid nitrogen infrastructure.

MVE Biological Solutions Vario Cryogenic Freezers - are innovative cryogenic freezers that can support temperatures anywhere between -20°C and -150°C. The Vario series of cryogenic freezers are able to provide effective and consistent temperature profiles with less than 1% of the power consumption and a 70% reduction in overall operating cost savings compared to traditional mechanical freezers.

In addition to these examples, Cryoport is continuously evaluating, expanding, and improving its range of services and solutions in response to the market requirements and client demand.

We intend to build on our history of developing market-leading, temperature-controlled supply chain solutions and delivering strong growth through the following strategies:

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The Markets We Serve

Cryoport serves the life sciences industry as a trusted provider of integrated temperature-controlled supply-chain solutions supporting the biopharma/pharma, animal health, and reproductive medicine markets.

Biopharma/Pharma. In the biopharma/pharma market, we are focused on supporting the saving of lives. From clinical research and development to clinical research organizations, to clinical trials for cell and gene therapies, to the storage and delivery of life-saving commercial cell and gene therapies, to the customers of biopharmaceutical and biotechnology organizations, to crucial points of care, we strive to address fundamental-to-advanced temperature-controlled storage, transport, packaging, fulfillment, and information challenges. Cell and gene therapies have become a rapidly growing area of biological drug development, with over $23.1 billion in funding raised in 2021 and 1,129 industry-sponsored, global clinical trials underway as of the third quarter of 2021, as reported by the Alliance for Regenerative Medicine in their 2022 Cell & Gene State of the Industry Briefing in January 2022. These therapeutic approaches have certain supply chain challenges that we believe our solutions are well tailored to address.

Cryoport has been focused on the cell and gene therapy market for the last seven (7) years. In that time, we have successfully established ourselves as a premier provider of supply chain solutions and now support 602 clinical trials and 8 commercial programs in the space. Our solutions have been developed to specifically support this space and offer the highest level of temperature control and visibility within the market. Additionally, Cryoport has developed its Chain of ComplianceTM platform that has been specifically developed to support irreplaceable clinical and commercial therapies and of which many of the critical requirements are featured in the recently released ISO 21973 guidance issued by the International Organization for Standardization (ISO) which specifically outlines General Requirement for Transportation of Cells for Therapeutic Use.

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Animal Health. In the animal health market, we provide support for animal reproduction, which primarily involves the production of protein for sustaining life. We also support medicine for the health of recreational and companion animals. Animal disease prevention and control rely on the safe transport and storage of vaccines and other biological materials around the world. Our temperature-controlled supply chain solutions are designed to help avoid costly delays through nonstop monitoring and complete fleet management from and to the origin and destination points as well as provide cryobiological storage equipment.

Reproductive Medicine. In the human reproductive medicine market, we are focused on the support of the creation of human life. This is primarily accomplished by supporting In Vitro Fertilization, or IVF, and related technologies along with clinical networks globally. Through our CryoStork® services, we transport reproductive materials through dedicated medical transport services to help ensure that IVF materials are on the next flight out to their destination. IVF materials also receive one-on-one handling and individualized attention during the entire logistics process. In addition, we also provide cryobiological storage equipment to fertility clinics around the world.

Acquisitions

We further expanded our capabilities in October 2020 by acquiring CRYOPDP, a leading global provider of innovative temperature-controlled logistics solutions for high value, time critical and temperature-sensitive pharmaceuticals. provides the biopharma market with temperature-controlled supply chain solutions including packaging, pick-pack kit preparation, premium services and specialty biopharma/pharma courier support. CRYOPDP added a network of 22 global logistics centers located in 12 countries to our global network. These additions expanded our logistics network giving us new advantages when serving global multi-national clients. They also added redundancies and backup that reduce supply chain risk for our clients. CRYOPDP is powered by a cloud-based logistics platform branded as UnITyTM, which we plan to integrate with our Cryoportal® Logistics Management Platform. UnITyTM, provides functionalities such as a transport management system, warehousing management system, quality management system, a customer experience portal, mobile apps for track and trace during transport and storage as well as integration with transportation agents and business partners. In the second quarter of 2021, we completed the acquisitions of Critical Transport Solutions Australia (CTSA) in Australia and F-airGate in Belgium to further enhance our existing global temperature-controlled supply chain capabilities in the APAC, and EMEA regions.

We also acquired MVE in October 2020. MVE provides cryobiological storage and transportation systems for the life sciences industry through its advanced line of cryogenic stainless-steel freezers, aluminum dewars and related ancillary equipment used in the storage and transport of life sciences commodities, which includes the rapidly growing cell and gene therapy business. With three primary facilities, located in Ball Ground, Georgia, New Prague, Minnesota and Cheng-du, China, MVE Biological Solutions is the leader in serving the life sciences industry throughout the world. The acquisition is a vertical integration that, in addition to expanding our footprint to handle the growing demand driven by the growth in the cell and gene therapy market, assures our supply of cryogenic systems. MVE strengthens Cryoport’s presence in all its markets, biopharma/pharma, animal health and reproductive medicine. Its clients include cell and gene therapy, medical laboratories, biotech/pharmaceutical research facilities, blood and tissue banks, animal breeders, veterinary laboratories, large-scale biorepositories, fertility clinics, etc.

In May 2019, we acquired Cryogene Labs (CRYOGENE), which is today an expanding state-of-the-art temperature-controlled biostorage solutions business strategically located in Houston, Texas. CRYOGENE is an industry leader in the management of pre-clinical biostorage services which include critical biological commodities supporting clinical research, the advancement of cell and gene therapy, and public health research. It provides customized, end-to-end chain of custody/chain of condition solutions for its clients. CRYOGENE is a FDA audited operation serving all temperature categories of the cold chain for the life sciences.

As of December 31, 2021, we lease or own 33 total sites across the Americas, EMEA and APAC regions.

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Segment Reporting

The Company continually monitors and reviews its segment reporting structure in accordance with authoritative guidance to determine whether any changes have occurred that would impact its reportable operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing operating performance. The chief operating decision maker (“CODM”) is our Chief Executive Officer. Up until the fourth quarter of 2020, we managed, reported and evaluated our business in the following two reportable operating segments: Global Logistics Solutions and Global Bioservices. During the fourth quarter of 2020, our CODM changed how he makes operating decisions, assesses the performance of the business and allocates resources in a manner that caused our operating segments to change as a result of the MVE Biological Solutions and CRYOPDP acquisitions. In consideration of Financial Accounting Standards Board's ("FASB") Accounting Standards Codification ("ASC"), Segment Reporting, we determined that we are not organized around specific products and services, geographic regions or regulatory environments. Accordingly, beginning with the fourth quarter of 2020 we realigned our reporting structure, resulting in a single reportable segment. The Company has adjusted its financial statements for historical periods to reflect this change in segment reporting and show its financial results without segments for all periods presented. See Part II, Item 7 – Management's Discussion and Analysis of Financial Condition and Results of Operations, in this Annual Report on Form 10-K for further discussion.

Customers and Distribution

As a result of growing globalization, including in such areas as biologics, biopharma, biotechnology, clinical trials, distribution of biopharmaceutical products and reproductive medicine, the requirement for effective and reliable solutions for keeping clinical samples, pharmaceutical products and other specimen at controlled temperatures takes on added significance due to more sophisticated supply chain challenges including complex shipping routes, extended shipping times, potential custom delays, general logistics challenges, distribution and storage requirements. We believe that our platform of solutions, expertise and geographic footprint enables us to take advantage of the growing demand for effective and efficient international transport and storage of temperature sensitive life sciences commodities and products. This is especially the case for the new therapies being developed in the regenerative medicine market, such as autologous and allogeneic CAR-T cell therapies, that require cryogenic temperatures to maintain safety and efficacy.

No single customer accounted for over 10% of our total revenues during the years ended December 31, 2021 and 2020. Two customers accounted for 24.1% and 12.8% of our total revenues during the year ended December 31, 2019.

Our geographical revenues, by origin, for the years ended December 31, 2021, 2020 and 2019, were as follows:

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Europe, the Middle East and Africa (EMEA) 26.7 % 25.8 % 13.3 %

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Customer types

Cryoport is a global leader in serving the life sciences industry as a trusted provider of integrated temperature-controlled supply-chain solutions supporting the biopharma/pharma, animal health, and reproductive medicine markets. Our major customer types include:

Clinical Trials -Every pharmaceutical or biotech company developing a new drug or therapy must seek development protocol approval by regulatory bodies, e.g., the FDA or EMA. Usually, these agencies require clinical trials to be designed to test the safety and efficacy of the potential new drug or therapy among other things. In connection with the clinical trials, due to globalization, companies may enroll patients from all over the world and may need to regularly submit a blood or other specimen at the local hospital, doctor’s offices or laboratories. Generally, these samples are then sent to specified testing laboratories, which may be local or in another country. In addition, the therapies used by the patients may require biostorage and time critical and/or temperature-controlled shipping to the sites of the clinical trials. Importantly, clinical trial specimens are often irreplaceable because each one represents clinical data at a prescribed point in time, in a series of specimens on a given patient, who may be participating in a trial for years. Sample integrity during the logistics process is vital to retaining the maximum number of patients in each trial and keeping the trial on schedule. Requirements can also include the return and destruction of these investigational medicinal products. Clinical trial support involves a full ecosystem of Clinical Research Organizations (“CRO”) and requires flexible and highly qualified end-to-end supply chain solutions for which we ideally suited.

Biotechnology and Diagnostic Companies - The biotechnology market includes basic and applied research and development in diverse areas such as stem cells, gene therapy, DNA tumor vaccines, tissue engineering, genomics, blood products, etc. Companies participating in the foregoing fields rely on the frozen storage and temperature-controlled transport of specimens in connection with their research and development efforts, for which our suite of supply chain solutions are ideally suited.

Cell Therapy Companies- Rapid advancements are underway in the research and development of cell-based therapies, which involve cellular material being infused into a patient. In allogeneic cell therapies, the donor is a different person than the recipient of the cells. Autologous cell therapy is a personalized therapeutic intervention that uses an individual’s cells, which are cultured and expanded outside the body, and reintroduced into the individual. Once cells are manufactured into a cellular therapy, in either case, they must be stored and shipped cryogenically for which our Cryoport Express® and Cryoport ELITETM Shipper solutions, CRYOPDP solutions, CRYOGENE biostorge, and MVE Biological Solutions’ stainless steel cryogenic freezers and aluminum dewars are ideally suited.

Contract Research, Development & Manufacturing Companies - Increasingly, as evidenced by our strategic partnership with Lonza, CRO’s, and Contract Development and Manufacturing Organizations (“CDMO’s”) are engaging our services exclusively in conjunction with their contract services platform in order to provide a higher level of service to our mutual client base. We anticipate that these relationships, which are mutually beneficial to both parties as well as our client base, will accelerate and expand to include our entire portfolio of services as cell and gene therapy clinical trials advances and as commercial therapies ramp on a global basis.

Central Laboratories- With the increase and globalization of clinical studies and trials, logistics have become more complex and ensuring sample integrity has become more challenging. International courier costs are now consuming an increasing portion of global protocol budgets; however, central laboratories are also looking for reliability, thus we believe laboratories performing the testing of samples collected during the conduct of these global multi-site studies are looking for cost effective, reliable state-of-the-art supply chain solutions. CRYOPDP’s global network of logistic centers have successfully supported central laboratories throughout the world for many years.

Pharmaceutical or Therapy Distribution - The current focus for our products and solutions also includes the area of bio-pharmaceutical supply chain. There are a significant number of therapeutic therapies currently or anticipated soon to be undergoing clinical trials. After the FDA or regional or national authorities in EMEA or APAC approve them for commercial marketing, it will be necessary for the manufacturers to have a reliable and economical method of bio-storage and distribution to the physician who will administer the product to the patient. We believe it is likely that the most efficient and reliable method of distribution will be to ship a single dosage to the administering physician. These therapies are typically identified to individual patients and therefore will require a complete tracking history from the manufacturer to the patient. The most reliable method of doing this is to ship a unit dosage specifically for each patient. If such therapies require temperature-controlled logistics, we can provide the technology to meet this need. This supply chain management also includes the support of Managed Access Programs, whereby patients with serious diseases sometimes require specific therapies that are not yet available and/or approved by local regulatory authorities.

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Fertility Clinics and IVF. Maintaining cryogenic temperatures during shipping and transfer of in vitro fertilization specimens like eggs, sperm, or embryos is critical for cell integrity to retain viability, stabilize the cells, and ensure reproducible results and successful IVF treatment. We believe that Cryoport Systems solutions for this market, branded as CryoStork® services, are very compelling and well received. Additionally, MVE supplies stainless steel cryogenic freezers to fertility clinics that wish to store reproductive materials on site. The Assisted Reproductive Technology (“ART”) industry is also starting to undergo a significant change due to the consolidation of clinic networks into large corporations or venture backed organizations, which we believe will allow us to further build out our leadership position and set industry standards.

Animal Health Companies. The global animal health market is largely driven by a significant rise in the zoonotic and food-borne diseases globally. This unprecedented disease prevalence has encouraged companies to produce advanced vaccines and pharmaceuticals. The high demand has also resulted in the subsequent rise in the number of companies making consistent efforts to control risks of pathogen contamination and food-borne diseases, which is contributing to market growth. In addition to food animal production, companion animal support is another emerging area in which companies are investing heavily. Cryoport’s MVE products, Cryoport Systems and CRYOPDP temperature-controlled supply chain solutions are well positioned to support storage and distribution needs of breeders, large-scale repositories, veterinary laboratories, and artificial insemination, particularly in the beef and dairy industries on a global basis.

University Research Facilities. Research is conducted globally at major universities. Often this is done in collaboration with others which requires shipping using Cryoport Express® Shippers or CRYOPDP services. When in storage, we believe storage at cryogenic temperatures provides the most secure long-term storage for high value samples. Our broad line of products provides solutions tailored to institutions and individual researchers as exemplified by CRYOGENE.

Sales and Marketing

We serve clients throughout the life sciences industries and our sales and marketing initiatives are global in nature, focusing on addressing each customer’s pain points and anticipated needs through best-in-class supply chain solutions. Our business development teams have resources in the Americas, EMEA and the APAC regions to proactively support our customers and to ensure efficient business development with respect to the customer’s geographic activity, size and decision-making structure. Our marketing teams design and implement targeted digital campaigns to support our commercial strategy and promote our innovative portfolio of solutions and capabilities. Our marketing initiatives are designed to drive our business development, program management, consulting, other related activities and increase awareness of our advanced temperature-controlled supply chain solutions. Given the global nature of our business and the high focus on customer development and acquisition, we plan to continue to extend our sales and marketing team’s reach in the Americas, EMEA and the APAC regions by further strengthening our marketing initiatives, hiring additional resources, and expanding our distributor and alliance network.

Competition

We believe Cryoport is unique in its offering, and we have not identified any competition that offers solutions that are as comprehensive or as in depth as our platform of temperature-controlled supply chain solutions and that has been proven in the global market to the same extent as our solutions have. However, we do have competition from companies that offer products and/or services that could be considered competitive to certain components or elements of our platform of solutions include specialty couriers, such as World Courier Group, Inc., Marken, Biocair and Quick Life Science Group along with companies that offer products such as Biolife Solutions, Azenta Life Sciences, Cytiva, and IC Biomedical. In addition, life science companies may develop their own in-house temperature-controlled supply chain solutions, systems and procedures to cover their needs.

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Engineering and Development

Our research, development and engineering efforts are focused on continually investigating new technologies that can improve our services and improving the features of our products and solutions, which includes our cloud-based Cryoportal® Logistics Management Platform, Cryoport Express® and Cryoport ELITETM Shippers, secondary packaging solutions, our SmartPak condition monitoring system, technology used to enhance our specialty courier solutions, as well as our advanced line of stainless-steel freezers, aluminum dewars and related ancillary equipment used in the storage and transport of life sciences commodities. These efforts are expected to lead to, based on market requirements, the introduction of additional systems and features, including dewars and other shippers of varying sizes and for various temperature ranges, bio-storage units of varying sizes and for varying ranges, further advanced informatics, and improved monitoring systems. We are continuously researching alternative and new technologies, lower cost materials, utilization of higher volume assembly methods, improved manufacturing methods and enabling technologies that will make it practical to provide a wider range of effective and advanced solutions. Some of these developments are further described under ‘Cryoport Products and Services’ further above.

Innovation

Supporting critical supply chain demands within the cell therapy space requires unique, dedicated temperature-controlled systems and processes. Applying traditional logistics methodology in support of cell therapies is often ineffective. Cryoport continues to develop a dedicated supply-chain platform specifically tailored to cell therapy storage, fulfillment, and distribution requirements. It is anchored by our Chain of Compliance® ISO 21973 compliant platform and supported by industry leading processes, technology, and experience. Critical to the advancement of our supply-chain platform is the ability to develop and launch market leading technologies, systems, and processes that continually improve the management of risk, provide the ability to scale, and enable our clients to focus on the development and manufacturing of their critical therapies and treatments. Specific examples that we have developed and/or have recently launched or are launching include the following novel supply chain products and services in support of our current offerings.

Cryoport ELITETM Shipper Systems

Cryoport ELITETM -80°C Gene Therapy Shipper. As the first product in a high-performance line of Cryoport ELITETM Shippers, the company has designed a best-in-class family of -80°C shippers that have superior temperature management properties as well as incorporate next generation protection, handling, and data collection and management systems including our SmartPakTM Condition Monitoring System. The Cryoport ELITETM shipper line has been developed in conjunction with one of the leaders in the gene therapy space for clinical and commercial gene therapy distribution. The ELITE shipper platform will be launched in 1H 2022.

Cryoport ELITETM CryosphereTM Shipper. The second product in the new high-performance line of Cryoport ELITETM Shippers is the CryosphereTM, which is a revolutionary gravitationally stabilized shipper that is the most advanced cryogenic shipper to support the Cell and Gene Therapy and other life sciences markets. The shipper is designed to passively stabilize the payload through an internal gravitational sphere, thereby keeping the payload in an upright orientation regardless of the external shipper orientation. This innovative technology further mitigates one of the key risks during storage, handling, and transport, which is maintaining constant cryogenic temperatures. In addition, the CryosphereTM will have advanced shock and vibration absorption properties to further protect the payload and will be outfitted with Cryoport’s state-of-the-art condition monitoring systems. It has also been designed to be ergonomically friendly for our manufacturing and clinical partners providing a better user experience than other products in the market. The CryosphereTM is expected to be launched during the first half of 2022.

MVE Fusion®

MVE Fusion Cryogenic Freezers are the world’s first and only self-sustaining cryogenic freezer. The Fusion is able to operate as a stand-alone unit and requires no on-going liquid nitrogen supply or connection to and external liquid nitrogen source. Fusion freezers are a perfect solution for remote geographic locations, isolated laboratories, high elevation facilities, or facilities without existing liquid nitrogen infrastructure.

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MVE Vario®

MVE Vario Cryogenic Freezers are innovative cryogenic freezers that can support temperatures anywhere between -20°C and -150°C. The Vario series of cryogenic freezers are able to provide effective and consistent temperature profiles with less than 1% of the power consumption and a 70% reduction in overall operating cost savings a compared to traditional mechanical freezers.

Cryoport Data Management Systems

SkyTraxTM Condition Monitoring System. SkyTraxTM is a next generation Condition Monitoring System. SkyTraxTM will be the only proprietary designed condition monitoring system custom built for the cell and gene industry. In addition to being 4G/LTE compliant with a 3G/2G back-up, cellular network agnostic, with a full sensor array to track location, temperature, humidity, light, shock, orientation, and geofencing, it will be Bluetooth and Wi-Fi capable, have triple data redundancy, a best-in-class battery life, as well as bi-directional communication providing scannable airway bills, commercial invoices, loading and unloading instructions, security access features, as well as temperature data via an E-ink screen. Upon introduction in 2022, it will also have the ability to be reprogrammable remotely in support of critical in-field logistics needs. SkyTraxTM will be fully integrated into our Cryoport Express® and Cryoport ELITETM Shipper Systems.

Cryoportal® 2.0 and UnITyTM. Cryoport Systems’ Cryoportal® 2.0. Logistics Management Platforms the industry’s only ISO 21973 compliant supply chain management platform. In addition to managing all aspects of a given client shipment, it also manages all elements of the Chain of ComplianceTM based aspects of the packaging as well including shipper management, requalification, and processing. Cryoport Systems’ Cryoportal® 2.0 is complimented by CRYOPDP’s recently released UnITyTM Transportation Management System. UnITyTM provides functionalities in addition to transport management that include: warehousing management, quality management, a Customer Experience portal, mobile apps for track and trace during transport and storage as well as integration with transportation agents and business partners. The combination of these two powerful informatics platforms provides Cryoport clients with a comprehensive status of their clinical or commercial distribution activities, supports regulatory requirements and further sets Cryoport apart from competition.

Global Supply Chain Centers

Cryoport Global Supply Chain Center Network. During the first half of 2022, Cryoport will launch its first two cell and gene therapy purpose-built Global Supply Chain Centers in Houston, Texas and Morris Plains, New Jersey. Each of these global facilities in addition to supporting critical logistics activities will also support all kitting, fulfillment, storage, secondary labelling, and drug return and destruction needs for our clients. They are specifically tailored to the needs of both autologous and allogeneic cell therapies, gene therapies, RNA therapies, and vaccines. We believe these first of their kind global supply chain centers are the beginning of a distinguishing global network that will offer unique advantages to the advancement of the regenerative medicine market.

Manufacturing and Raw Materials

Manufacturing. We source components for our products from multiple suppliers, including those that manufacture to our engineering specifications, using, in part, proprietary technology and know-how to mitigate supply chain risks. We also use “off-the-shelf” products, which we may modify to meet our requirements. For some components, there are relatively few alternate sources of supply and the establishment of additional or replacement suppliers may or may not be accomplished immediately. When this occurs, we endeavor to mitigate risk by locating an alternative qualified supplier and, as appropriate, increasing our inventory level. For additional information see the “Risk Factors” section of this document.

Our vendor/partner relationships allow us to concentrate on further advancing and expanding our platform of systems, products, and solutions for the life sciences to meet the growing and varied demands for validated temperature-controlled solutions in the life sciences industry. We endeavor to keep our supply structure up to date and agile as it provides us the opportunity to rapidly scale to support our client’s commercialization, systems, products, and solutions requirements; however, we are ever mindful of the work we must do to improve our current sourcing and to continue to mitigate risks therein.

Raw Materials. Various raw materials are used in the manufacture of our products and in the development of our technologies. Most raw materials are generally available from several alternate distributors and/or manufacturers. Where we have experienced significant difficulty in obtaining these raw materials, we have established alternative global sources or are working with the existing supplier to overcome its deficiency.

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Patents, Copyrights, Trademarks and Proprietary Rights

To remain competitive, we must develop and maintain protection on the proprietary aspects of our platform of technologies. We rely on a combination of patents, copyrights, trademarks, trade secret laws and confidentiality agreements to protect our intellectual property rights.

We file patent applications to protect innovations arising from our research, development and design. We currently own approximately 32 issued patents and have more than 50 pending patent applications throughout the world. Our patents generally protect certain aspects of our products and related technology. We also own common law and registered trademarks in the U.S. and in certain foreign countries to protect the names of our company, certain products, and key service brands. We own certain copyrights relating to certain aspects of our systems, products and services.

Our success is influenced, in part, by our ability to continue to develop proprietary products and technologies. It is desirable to obtain patent coverage for these products and technologies; however, some are protected as trade secrets. We intend to file trademark and patent applications covering any newly developed products, methods and technologies. However, there can be no guarantee that any of our pending or future filed applications will be issued as patents or registered as trademarks. There can be no guarantee that the various patent and trademark governmental agencies from around the world or some third party will not initiate an interference proceeding involving any of our pending applications or issued patents. Finally, there can be no guarantee that our issued patents or future issued patents, if any, will provide adequate protection from competition.

Patents provide some degree of protection for our proprietary technology. However, the pursuit and assertion of patent rights involve complex legal and factual determinations and, therefore, are characterized by significant uncertainty. In addition, the laws governing patent issuance and the scope of patent coverage continue to evolve. Moreover, the patent rights we possess or are pursuing generally cover our technologies to varying degrees. As a result, we cannot ensure that patents will issue from any of our patent applications, or that any of the issued patents will offer meaningful protection. In addition, our issued patents may be successfully challenged, invalidated, circumvented, or rendered unenforceable so that our patent rights may not create an effective barrier to competition. We must also pay maintenance fees at set intervals for our patents to not expire prematurely. The laws of some foreign countries may not protect our proprietary rights to the same extent as the laws of the United States. There can be no assurance that any patents issued to us will provide a legal basis for establishing an exclusive market for our products or provide us with any competitive advantages, or that patents of others will not have an adverse effect on our ability to do business or to continue to use our technologies freely. As with all patents, we may be subject to third parties filing claims that our technologies or products infringe on their intellectual property. We cannot predict whether third parties will assert such claims against us or whether those claims will hurt our business. If we are forced to defend against such claims, regardless of their merit, we may face costly litigation and diversion of management’s attention and resources. As a result of any such disputes, we may have to develop, at a substantial cost, non-infringing technology or enter into licensing agreements. These agreements may be unavailable on terms acceptable to such third parties, or at all, which could seriously harm our business or financial condition.

With respect to our trademarks, we file and pursue trademark registrations on words, symbols, logos, and other source identifiers that clients use to associate our products and services with us. Although our registered trademarks carry a presumption of validity, they can be challenged and possibly invalidated and as such, we cannot guarantee that any trademark registration is infallible.

We also rely on trade secret protection of our intellectual property. We attempt to protect trade secrets by entering into confidentiality agreements with employees, consultants and third parties, although, in the past, we have not always obtained such agreements. It is possible that these agreements may be breached, invalidated, or rendered unenforceable, and if so, our trade secrets could be disclosed to our competitors. Despite the measures we have taken to protect our intellectual property, parties to such agreements may breach confidentiality provisions in our contracts or infringe or misappropriate our patents, copyrights, trademarks, trade secrets and other proprietary rights. In addition, third parties may independently discover or invent competitive technologies, or reverse engineer our trade secrets or other technology. Therefore, the measures we are taking to protect our proprietary technology may not be adequate.

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Cryoport’s Quality Assurance and Regulatory Affairs Programs

Cryoport is committed to quality, and this is reflected in all aspects of our global organization. From our innovative design of products and services to our continuous improvement initiatives, Cryoport has implemented comprehensive quality standards that match or exceed the stringent requirements within the markets we serve. Cryoport’s Quality Management Systems have been designed, implemented, and certified to meet ISO 9001:2015 and ISO 13485 standards in key global locations, demonstrating the discipline necessary to maintain a positive compliance profile. With our strong foundation in ISO 9001:2015 and ISO 13485, we leverage industry-specific experience with applicable regulatory requirements, and industry expectations, to create processes and procedures that incorporate strong operational practices of checks with verification. Our Quality Management Systems are designed to ensure proper controls in logistics, customer/client education, contracting, processing, shipping and storage, accumulation, and communication. Providing each customer with the proper information, monitoring, and data collection to support Chain of Compliance, Chain of Custody and Chain of Condition, culminating in the successful completion of each transaction or shipment within regulatory requirements.

Our Quality Management Systems incorporate notable good practice quality guidelines and regulations (GxP) elements, beyond those stipulated in ISO 9001:2015 and ISO 13485, to ensure our customers are supported in the manner necessary to maintain standards and to secure a positive compliance profile for Cryoport as a supplier and partner. Notable elements include, but are not limited to, Good Documentation Practices, Good Distribution Practices, Archival processes and procedures, Supplier Controls, and Corrective Action and Preventive Action (CAPA) procedures, to highlight a few examples.

Through procedural requirements, Cryoport provides substantial risk-mitigation strategies throughout its full offering of products, systems, and services to support and maintain customer confidence. Metrics and Key Performance Indicators are accumulated regularly, and are trended to predict, and mitigate, potential risks to operations. Senior management utilized this information to enact decisions regarding procedures, processes, resource allocation, and corrective actions. Quality-driven initiatives are supported throughout our global organization. In addition, Cryoport’s manufacturing operations are ISO 13485 certified as medical manufacturing facilities and are audited for compliance on a regular basis by authorized authorities. We are also subject to GMED, which is an international reference body in the certification of health care and medical devices quality management systems under ISO 9001, NF EN ISO 13485 and ISO 13485. As such, we are subject to audits buy a Medical Device Single Audit Program (MDSAP) auditing organization. Cryoport’s cryogenic storage facilities are routinely inspected by the U.S. Food and Drug Administration (FDA) and The Foundation for the Accreditation of Cellular Therapy (FACT) to confirm regulatory compliance to industry requirements related to drug applications, filings, and maintenance of various cryogenically stored materials.

Government Regulation

Globally, Cryoport is subject to numerous domestic federal, state, and local laws and regulations as well as international regulations relating to shipments, customs, import, export, safe working conditions, manufacturing practices, environmental protection, and disposal of hazardous or potentially hazardous substances. In addition, we must ensure compliance with economic sanctions and/or restrictions on individuals, corporations, or countries, and other government regulations affecting trade that may apply to our international cross border business activities.

The shipping of biologic products, biologic commodities, diagnostic specimens, infectious substances, and dangerous goods, whether via air or ground, falls under the jurisdiction of many state, federal and international agencies. The quality of the packaging that protects such entities is critical in determining successful shipping conditions and to ensure a commodity will arrive at its destination in a satisfactory condition. Meeting stringent regulations such as Dangerous Goods Regulations, ISTA, and IATA, as applicable, Cryoport has demonstrated compliance and adhesion to these requirements. Many of the regulations for transporting dangerous goods in the United States are determined by international rules formulated under the auspices of the United Nations. Dangerous goods are typically one-time shipments and are not a part of our routine services. When called upon to ship dangerous goods, Cryoport follows strict and stringent guidelines. International Civil Aviation Organization (“ICAO”) is the United Nations organization that develops regulations (Technical Instructions) for the safe transport of dangerous goods by air. If shipment is by air, compliance with the rules established by the International Air Transport Association (“IATA”) is required. IATA is a trade association made up of airlines and air cargo couriers that publishes annual editions of the IATA Dangerous Goods Regulations. These regulations interpret and add to the ICAO Technical Instructions to reflect industry practices. Additionally, the Centers for Disease Control (“CDC”) has regulations (published in the Code of Federal Regulations) for interstate shipping of specimens.

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Our Cryoport Express® and ELITETM Shippers meet Packing Instructions 602 and 650 and are certified for the shipment of Class 6.2 Dangerous Goods per the requirements of the ICAO Technical Instructions for the Safe Transport of Dangerous Goods by Air and IATA. Our present and planned future versions of the Cryoport SmartPakTM Condition Monitoring Systems will likely be subject to regulation by the Federal Aviation Administration (“FAA”), Federal Communications Commission (“FCC”), Food and Drug Administration (“FDA”), IATA and possibly other agencies which may be difficult to determine on a global basis. Additionally, our Chain of ComplianceTM processes comply fully with ISO 21973 recommendations.

Storage of biological materials that are classified as drug products for human therapeutic use (either for investigational use or commercially approved) or materials used in the manufacture of drug products for human therapeutic use, is regulated by the FDA under Title 21 Code of Federal Regulations (“CFR”) part 210 & 211. Facilities must be compliant with current Good Manufacturing Practice (“GMP”) regulations which are enforced by the FDA through registration and audit. When drug products are exported to other countries, storage upon receipt must meet relevant local regulations.

Our MVE Biological Solutions cryogenic stainless-steel freezers and aluminum dewars are certified to the Medical Device Directive (MDD) in the European Union. Additionally, registrations for import are in place for various countries with these requirements.

For additional information, See “Part I, Item 1A — Risk Factors—Risks Related to Regulatory and Legal Matters” in this Form 10-K.

Environmental, Social and Governance (“ESG”)

Beginning in 2020 we initiated a formal internal evaluation of our ESG policies, procedures, and performance. Subsequently in February 2021, we publicly disclosed ESG information based on the framework and standards set by the Sustainability Accounting Standards Board (SASB) and the Taskforce on Climate-related Financial Disclosures (TCFD). Building upon our first report, we began with the goal of developing a formal, thoughtful, comprehensive, and right-sized sustainability program that would be used as a foundation for effectively organizing, reporting, and measuring our performance to set ESG goals in the future.

In June of 2021, we began a materiality assessment to guide our overall sustainability strategy. The intent of the materiality assessment was to understand what ESG topics were important to our key stakeholders, to take into consideration Cryoport’s business strategy development, and to understand Cryoport’s global internal priorities. There were three key activities for this phase of the process:

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The information and feedback received from the materiality assessment was aggregated into a customized and weighted materiality matrix. The following Materiality Matrix follows GRI Standards recommendations and plots topics based on their relative priority resulting from the materiality assessment.

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Once the Materiality Matrix was developed, several meetings were conducted internally with our ESG committee and our Board of Directors’ Nomination and Governance Committee to evaluate the findings.

Cryoport Materiality Matrix

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Leveraging the outcomes of the materiality assessment, Cryoport’s Sustainability Strategy was developed to establish focus and a consistent approach to sustainability across the business. Cryoport’s Sustainability Framework defines our overarching vision and mission statements with supporting pillars and corresponding focus areas, as demonstrated below.

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Environmental

As Cryoport continues to grow its business in a way that is considerate of our global community, we are committed to protecting our planet by using our world’s resources sensibly and minimizing our emissions and waste on a global basis. From an environmental standpoint, one example of our sustainability efforts is our cryogenic Cryoport Express® Shipper, which uses the non-hazardous dry vapor form of liquid nitrogen and proprietary informatics to drive efficiencies in the use of resources throughout our company. This service offering also employs multi-use and recyclable packaging. Knowing that there is much more to do to aid in our environmental efforts, we have recently developed a system to collect data on a global scale for the purpose of quantifying the impact of all our environmental initiatives so that we can demonstrate our achievements on this important matter to our shareholders, customers and other interested stakeholders.

Greenhouse Gas Emissions (GHGs)

As we proceed on our ESG journey in 2022, our initial key focus will be on GHG Emissions. GHG emissions were the foremost priority identified in our Materiality Matrix and represent a clear global significance for companies, consumers, and other stakeholders.

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Cryoport engaged an ESG advisor upon completion of our Sustainability Strategy to assist in determing our carbon footprint. Through this engagement, we will define our Scope 1 and Scope 2 emission sources, collect and compile relevant data to quantify our emissions, and establish a carbon accounting methodology in accordance with the GHG Protocol. The outcome will be a baseline carbon footprint for Cryoport and the ability to execute consistent carbon accounting in the future. These tools will enable us to identify key opportunities to implement targeted projects that will drive GHG emissions reductions in the future. One means of reducing our carbon footprint is procurement of electricity from GHG emissions free resources for our biostorage plant in Houston, Texas. Procurement of GHG emissions free electricity has translated to a significant reduction in carbon emissions compared to energy provided by coal-fired power plants. In 2021, the Houston plant consumed 4,489,987 kWh of electricity. By utilizing electricity from GHG emissions free resources, the emission of 1,440,257 pounds of GHGs was avoided. This emissions savings is the equivalent of removing 242 passenger vehicles driven for one year.

Resource Efficiency

Cryoport understands the importance of resource conservation as it relates to the efficient use of resources, reduction of our carbon footprint, and effective cost management. To that end, Cryoport strives to operate in an efficient manner to ensure the optimization of raw materials, equipment, waste, energy and labor. We have identified thermal efficiency as the largest impact on energy conservation associated with our products. To manage this aspect of the business, our Global Logistics Center Network utilizes the International Safe Transit Association (ISTA) standard 7E to test and evaluate thermal performance against stated requirements of 10+ days of maintaining internal temperatures at or below negative 150oC. Our products comply with this standard, and in turn, the products insulative properties require less energy to maintain prescribed temperature levels.

Cryoport’s dewars do not consume any electricity, and our freezer units utilize liquid nitrogen as a cooling agent, which is the by-product of other processes, creating a closed-loop resource that reduces additional energy associated with sourcing, procuring, and delivery of resources purchased from third parties. In 2021, our use of liquid nitrogen freezers, when compared to the energy consumption of a standard -150OC mechanical freezer, prevented the consumption of 1,883,136 kWh of electricity, equivalent to 1,725,871 pounds of GHG emissions avoided.

We also exemplify efficiency through the development and use of the cryogenic Cryoport Express® Shipper, which uses the non-hazardous dry vapor form of liquid nitrogen and proprietary informatics to drive efficiencies in the use of resources throughout our company. Our Cryoport Express® Shipper is also a multi-use offering with recyclable packaging.

In addition, Cryoport measures the effectiveness and efficiency of our production practices by tracking the amount of scrap material disposed of or sold on an annual basis. Stainless steel products that do not meet our stringent specification are reworked into our process to create new products that meet specifications, diverting the material from landfill and scrap recycling for beneficial reuse as new product. Any scrap metal that does not meet specification and cannot effectively be reworked into new product is recycled by third party recycling partners.

Further, in 2021 our Paris, France operations moved into a new facility, which is designed with the highest French environmental standards and equipped with solar panels to reduce energy consumption and GHG emissions. Overall, our efforts in these areas, among others not highlighted, have a positive environmental outcome for Cryoport and its customers.

Supporting Our People

Cryoport’s global team of employees are our most valuable resource, from our teams on the front line in our global supply chain and logistics centers, to our manufacturing operations, to our business development personnel, to the engineers who design our products and services, to our quality assurance and regulatory teams that assure the safety, quality, compliance, and integrity of our products.

Diversity, Equity & Inclusion (DEI)

We are committed to inclusion, equity and diverse representation for our employees across our Company. Cryoport is an Equal Employment Opportunity employer and currently tracks gender distribution across its operations and management. We maintain clear policies related to anti-harassment, discrimination and retaliation, and provide an anonymous, third party-managed reporting hotline for employees to report incidents of harassment, discrimination, and policy violations. In 2021, we further enhanced our online corporate training programs related to diversity, harassment and discrimination, so that employees receive annual training on the topics of

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harassment, diversity and inclusion, business ethics and code of conduct. In addition, Cryoport’s recruiting programs include targeted outreach to a variety of under-represented constituents, including minorities, women, veterans, and disabled populations to help improve recruiting efforts while gaining valuable insights from a diverse set of recruits. Cryoport has partnered with or targeted organizations like Hire Heroes, Career OneStop, recruiting at Historical Black Colleges, Accounting and Financial Women’s Alliance, and Women in Technology.

Cryoport understands that the manufacturing industry is typically male-dominated. In an effort to open opportunities for more female roles within our organization, Cryoport currently tracks gender distribution across operations. As of December 2021, women represented a total of approximately 30% of all employees, with approximately 18% of manager and 8% of directors being women. Senior leadership positions, at Vice President and above, currently sits as approximately 2%. Based on this data, Cryoport understands that there is work to be done to create a more equitable and representative senior leadership team and continue to push gender diversity throughout its operations.

Employee Health & Safety

Cryoport’s Employee Health & Safety (EHS) programs have resulted in strong safety performance, as demonstrated by our total injury rate (TIR) and lost time injury rate (LTIR) being significantly lower than the global industry averages. Facilitated by our culture of continuous improvement, we are committed to continue to work toward reducing our TIR and LTIR numbers even further.

We have implemented flexible working arrangements, including telecommuting and part time arrangements, in order to maintain a safe working environment for our employees throughout the COVID-19 pandemic.

Innovating Responsibly

Cryoport recognizes the role we play in protecting the health and safety of current and future generations through services and solutions that promote sustainability, resilience, and respect for the environment. We strive for a product base that is of the highest quality and with long use phases to minimize impact associated with production of new product, and Cryoport reviews opportunities to eliminate materials of concern and related managed waste streams on a regular cadence.

Product & Service Quality

As a temperature-controlled supply chain provider to the life sciences industry, Cryoport must comply with the safe transportation of regulated hazardous materials. As a result, we have designed and developed several features in its various products to comply with US DOT, IATA, ICAO, and other regulatory and guidance bodies. Additionally, safety warnings are included in our product labeling as well as our manuals. Our products are designed to conform to the following standards (where applicable):

● ISO 13485 (Section 7.3 Design and Development, ISO, QMS)

● ISO 14971 Application of Risk Management, ISO

● Low Voltage Directive (LVD) (2014/35/EU)

● Electromagnetic Compatibility Directive (2014/30/EU)

● RoHS 2 (2011/65/EU) (we are actively working on RoHS 3 and REACH)

● ASME SEC. VIII Pressure Vessel Code (Fusion Only)

● EU Pressure Equipment Directive (EU97/23/EC) (Fusion Only)

● FCC 47 CFR Class B Verification (Fusion Only)

● IEC 62304 Medical device software — Software life cycle processes

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These standards are woven into our development methodology used to design all new products within the organization. This development process includes a risk management assessment done in accordance with ISO 14971 that identifies hazards and mitigates risks via design improvements, process improvement, and warnings (including labels and safety information shipped with the product).

We pride ourselves on our exceptional operational quality. Our temperature-controlled supply chain solutions focused on cell and gene therapies boast a 99.89% delivery success rate and due to this performance 13,477 additional patients were able to receive therapies over the past 24 months and 1,334 intended parents are potentially able to have successful cycles resulting in the birth of a child on an annual basis because of our CryoStork® solution.

While rare, recalls of product may become necessary. The primary responsibility for recall management lies with our Vice President of Quality Assurance and Regulatory Affairs for manufacturing. The executive staff is involved in decision and implementation processes depending upon the specifics of any recall required. Customer service personnel, sales staff and other resources would then be utilized in reaching all distributors and direct end users. Results of recalls are evaluated daily until the recall is closed. There were no product recalls during 2021.

Product Lifecycle Management

Cryoport creates unique products with long-term use in mind. Cryoport products are primarily constructed of recyclable aluminum or stainless steel and we approach the extension of product lifecycles through the following four areas:

● Longevity

● Repairability

● Reusability

● Recyclability

We strive for a product base with long use phases to minimize impact associated with production of new product. At our MVE Biological Solutions production facility, we manufacture fusion freezer units that utilize 1/587 of the energy used by conventional mechanical freezers used for similar applications. For example, our freezer production displaced annual electricity consumption by 139,424,817 kWh from what would otherwise be consumed from alternative products. This amount of electricity could power 11,899 homes (sized at 2,500 square feet) annually. This reduction in energy consumption from our freezer lines alone equates to 123,444,781 pounds of GHG emissions avoided or the emissions equivalent to 21,489 passenger vehicles driven for one year.

Cryoport regularly reviews opportunities to eliminate the use of materials considered hazardous and related managed waste streams on a regular cadence. Cryoport does not utilize any substances of concern in our products; We do currently utilize minimal quantities of hazardous materials that are not listed substances of concern in our operations, primarily in the form of isopropanol, epoxies, butyl cellosolve, lacquer thinner, paint, hyamine and isopropyl alcohol. These materials and the insignificant quantities of hazardous wastes generated in our production facilities are managed in compliance with all state and federal regulations. Any hazardous waste that is generated is tracked and managed with an overall goal of eliminating hazardous materials where possible.

Cryoport does not utilize any minerals identified as conflict minerals (tin, tungsten, tantalum and gold) and makes our best effort to ensure that our suppliers practice responsible sourcing practices, as further detailed in Supplier Management under our Governing Ethically pillar.

Governing Ethically

Cryoport recognizes constructive supplier relationships as essential to our ability to meet customer requirements for quality solutions. We expect our business partners to share our commitment to ethics, integrity, compliance, safety, human rights, data security, and environmental protection. By the same token, as a provider accountable to thousands of companies worldwide, we pledge, through our ESG performance, to meet or exceed our clients’ requirements for the same.

Business Ethics

We are committed to operating with honesty, truthfulness and transparency in accordance to the highest ethical and corporate governance standards – mutual respect, integrity and trust are our foundation. As an ethical operator, we have developed a robust Code of Conduct and hold ourselves accountable to it in all we do. All employees across our operations are provided with training and

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reference materials to reinforce this commitment to integrity and ethics in our business. Our policies are clearly defined, published in local languages where applicable, and include guidance on topics including, but not limited to:

● Corruption

● Anti-Trust and Anti-Competitive Behavior

● Insider Dealings

● Gifts

● Bribes (e.g., explicit prohibition of facilitation payments)

● Conflicts of Interest

● Intellectual Property

● Compliance

● Truthful and accurate reporting

● Interactions with Healthcare professionals

● Whistleblower protections (including non-retaliation)

In addition to our Code of Conduct, our senior leadership team actively oversees the governance of our ethics programs to help ensure that commitment is driven from the top down, and that program owners are accountable for successful program compliance.

Cryoport does not conduct clinical trials, animal testing or use human tissue of any kind in the manufacture or design of our products, and our Code of Conduct governs the ethical behavior of our employees across Cryoport operations. Further, the Company does not conduct lobbying activities.

Supplier Management

Temperature controlled supply chain support to the life sciences industry is critical to all that Cryoport does; therefore, we take an active approach to managing suppliers and partners to ensure that appropriate compliance, health, safety, labor practices, and ethical standards are employed. Our internal diligence process for third-party vendors including a supplier questionnaire that is required for vendor approval and a regular auditing scheme thereafter for existing suppliers. The questionnaire is intended to verify that programs exist to manage material risk areas associated with the given supplier’s operations and particular consideration is paid to diligencing bribery or other forms of corrupt activity. No suppliers are approved until this mandatory due diligence is complete and a completed assessment form is on file.

As an example of verification that programs exist to manage material risks for any given supplier, if our transportation suppliers employ or work with a Dangerous Goods Safety Advisor, we confirm the presence of a credentialed role responsible for overseeing activities associated with dangerous goods, including but not limited to, employee training and coaching, reporting, and monitoring of activities associated with the transportation of dangerous goods. The purpose of this inquiry is to gauge the degree of oversight over dangerous goods management by our suppliers to help ensure product and employee welfare.

Our Code of Conduct extends through our suppliers and thus sets an expectation for our suppliers to commit to operating with honesty, truthfulness and transparency in accordance to the highest ethical and corporate governance standards, as Cryoport personifies through our operations. Per our Code of Conduct, Cryoport will not tolerate the use by suppliers of forced labor in any form.

Data Privacy & Security

Cryoport uses an outside Center for Internet Security (CIS) assessment firm to evaluate its data security controls in an effort protect our businesses and secure the information of our employees and customers. The evaluation process utilizes the CIS Critical Security Controls Capability Maturity Model Integration (CMMI) methodology, and is an ongoing initiative used to continuously improve the CMMI rating for the Company.

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Cryoport Impact Statements

Examples of some of our positive environmental impacts for 2020 and 2021 include the following:

Impact of COVID-19

Refer to the sections entitled “Risks Factors” for risks we face due to the COVID-19 pandemic and “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Impact of COVID-19” for information on the impact of COVID-19 on the Company.

Employees

We refer to our employees as our “team.” They are critical to our success, and we are in constant communication and training. We believe that we have assembled a strong management and leadership team with the experience and expertise needed to execute our business strategy. As of December 31, 2021, we had 847 employees: 791 full-time, 15 part-time, and 41 temporary, of which 411 are located in the Americas, 184 in EMEA and 252 in APAC. This is an increase of over 220 employees since December 31, 2020, primarily as a result of the further build out of our global organization to support the expected growth in the markets we serve. We anticipate hiring additional personnel as required to implement our global growth strategy.

Corporate History and Structure

We are a Nevada corporation originally incorporated under the name G.T.5-Limited (“GT5”) on May 25, 1990. In connection with a Share Exchange Agreement in March 2005, we changed our name to Cryoport, Inc. and acquired all of the issued and outstanding shares of common stock of Cryoport Systems, Inc., a California corporation. Cryoport Systems, Inc., which was originally formed in 1999 as a California limited liability company, was reorganized into a California corporation on December 11, 2000 and converted into Cryoport Systems, LLC, a California limited liability company, on September 17, 2020, remains one of our operating companies under Cryoport, Inc. Our principal executive offices are located at 112 Westwood Place, Suite 350, Brentwood, TN 37027. The telephone number of our principal executive office is (949) 470-2300, and our main corporate website is www.cryoport.com. The information on or that can be accessed through our website is not part of this Form 10-K.

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Information about our Executive Officers

The following are our executive officers as of the filing date of this Form 10-K:

Jerrell W. Shelton. Mr. Shelton became a member of our board of directors in October 2012 and was appointed President and Chief Executive Officer of the Company in November 2012. He was appointed Chairman of the Board in October 2015. He served on the Board of Directors and standing committees of Solera Holdings, Inc. from April 2007 through November 2011. From June 2004 to May 2006, Mr. Shelton was the Chairman and CEO of Wellness, Inc., a provider of advanced, integrated hospital and clinical environments. Prior to that, he served as Visiting Executive to IBM Research and Head of IBM’s WebFountain. From October 1998 to October 1999, Mr. Shelton was Chairman, President and CEO of NDC Holdings II, Inc. Between October 1996 and July 1998, he was President and CEO of Continental Graphics Holdings, Inc. From October 1991 to July 1996, Mr. Shelton served as President and CEO of Thomson Business Information Group. Mr. Shelton has a B.S. in Business Administration from the University of Tennessee and an M.B.A. from Harvard University. Mr. Shelton’s extensive leadership, management, strategic planning and financial expertise through his various leadership and directorship roles in public, private and global companies, makes him well-qualified to serve as a member of the board of directors.

Robert S. Stefanovich. Mr. Stefanovich became Chief Financial Officer and Treasurer for the Company in June 2011. In 2019, he was also given the title Senior Vice President. From 2011 to 2019, Mr. Stefanovich served as the Secretary of the Company. From June 15, 2012 to November 4, 2012, Mr. Stefanovich served as the Principal Executive Officer of the Company. From November 2007 through March 2011, Mr. Stefanovich served as Chief Financial Officer of Novalar Pharmaceuticals, Inc., a venture-backed specialty pharmaceutical company. Prior to that, he held several senior positions, including interim Chief Financial Officer of Xcorporeal, Inc., a publicly traded medical device company, Executive Vice President and Chief Financial Officer of Artemis International Solutions Corporation, a publicly traded software company, Chief Financial Officer and Secretary of Aethlon Medical Inc., a publicly traded medical device company and Vice President of Administration at SAIC, a Fortune 500 company. Mr. Stefanovich also served as a member of the Software Advisory Group and an Audit Manager with Price Waterhouse LLP’s (now PricewaterhouseCoopers) hi-tech practice in San Jose, California and Frankfurt, Germany. He received his Master of Business Administration and Engineering from University of Darmstadt, Germany.

Mark Sawicki, Ph.D. Dr. Sawicki became President and Chief Executive Officer of Cryoport Systems, LLC, a wholly-owned subsidiary of the Company, and the Senior Vice President and Chief Scientific Officer of the Company in September 2020 and served as the Chief Commercial Officer of Cryoport Systems from January 2015 to August 2020. Dr. Sawicki brings over 20 years of business development and sales management experience, having consistently delivered on corporate revenue and market share goals in the pharmaceutical and biotechnology industries. Dr. Sawicki previously served as the Chief Business Officer at AAIPharma Services Corporation/Cambridge Major Laboratories Inc. (now Alcami Corporation), a contract development, testing, and manufacturing organization for pharma and biotech companies. Additionally, he has served in senior business development roles at CMC Biologics, a provider of biopharmaceutical contract manufacturing services, and Albany Molecular Research Inc. (AMRI), a contract research and manufacturing organization. Dr. Sawicki holds a bachelor's in biochemistry from the State University of New York at Buffalo and a Ph.D. in biochemistry from the State University of New York at Buffalo, School of Medicine and Biomedical Sciences. He also received graduate training at the Hauptman Woodard Medical Research Institute. Dr. Sawicki has authored a dozen scientific publications in drug discovery with a focus on oncology and immunology.

Available Information

Our main corporate website address is www.cryoport.com. The information on or that can be accessed through our website is not part of this Form 10-K. We electronically file with the SEC our Annual Report on Form 10‐K, Quarterly Reports on Form 10‐Q, Current Reports on Form 8‐K and amendments to the reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act. We make available free of charge on or through our website copies of these reports as soon as reasonably practicable after we electronically file these reports with, or furnish them to, the SEC. The SEC also maintains an internet site that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC at www.sec.gov.

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ITEM 1A. RISK FACTORS

The following risk factors could materially and adversely affect our business, financial condition and results of operations. These risk factors do not identify all of the risks that we face. Our business, financial condition and results of operations could also be affected by factors that are not presently known to us or that we currently consider to be immaterial.

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Risks Related to Our Business

We depend on the availability of certain component products used in our solutions; delays or increased costs in the procurement of components manufactured by third parties could adversely affect our business operations, financial performance and results of operations, and we may experience customer dissatisfaction and harm to our reputation.

If we fail to procure sufficient components used in our products from our third-party manufacturers, we may be unable to deliver our solutions to our customers on a timely basis, which could lead to customer dissatisfaction and could harm our reputation and ability to compete. We currently acquire various component parts for our solutions from various independent manufacturers, some of which are sole sourced. We would likely experience significant delays or cessation in producing some of these components if a labor strike, natural disaster, public health crisis or other supply disruption were to occur, including as a result of the COVID-19 pandemic, at any of our main suppliers.

For example, there is currently a worldwide shortage of semiconductor, memory and other electronic components affecting many industries. Certain of our MVE Biological Solutions products and our SmartPak system are dependent on some of these electronic components. A continued shortage of electronic components may impact us significantly and could cause us to experience extended lead times and increased prices from our suppliers. Extended lead times and decreased availability of key components could result in a significant disruption to our production schedule and our services, all of which would have an adverse effect on our business operations, financial performance and results of operations. We do not have any guarantees of supply from our third-party suppliers, and in certain cases we have limited contractual arrangements or are relying on standard purchase orders or on component parts available on the open market, which may further result in increased costs combined with reduced availability.

If we are unable to procure a component from one of our manufacturers, we may be required to enter into arrangements with one or more alternative manufacturing companies, which may cause delays in producing components or result in a significant increase in costs. Even though, we have experienced materials and transportation challenges, to date, we have not experienced any material delay that has adversely impacted our operations, but this does not mean that we will continue to have timely access to adequate supplies of essential materials and components in the future or that supplies of these materials and components will be available on satisfactory terms when needed. If our vendors for these materials and components are unable to meet our requirements, fail to make shipments in a timely manner, or ship defective materials or components, we could experience a shortage or delay in supply or fail to meet our contractual requirements, which would adversely affect our results of operations and negatively impact our cash flow and profitability. Continued delay in our ability to produce and deliver our products and services could also cause our customers to purchase alternative products and services from our competitors and/or harm our reputation.

The retirement of older telecommunications technology, such as 2G and 3G, by cellular network providers will require updates to our equipment, which could adversely impact our business operations, financial performance and results of operations.

Most providers of cellular networks globally have begun to retire their 2G cellular networks and/or have announced their intentions to retire their 2G and 3G cellular networks sometime in 2022. Certain elements of our operating model, including our SmartPak II® condition monitoring system, currently rely in part on 2G and 3G cellular networks to transmit data to our Cryoportal® Logistics Management Platform. We are currently in the process of upgrading our existing equipment that uses these cellular networks in order to meet new network standards. Additionally, current delays and uncertainties in the supply chain for semiconductor chips may impact the timely delivery to us of the sensors required to make some of these upgrades. If we are unable to upgrade our existing equipment prior to the retirement of 2G and 3G cellular networks in a timely and cost-effective manner, our business operations, financial performance and results of operations could be materially adversely affected, including due to disruptions in our ability to provide our full monitoring solutions.

Our products and services may contain errors or defects, which could result in damage to our reputation, lost revenues, diverted development resources and increased service costs, litigation and product recalls.

Our products and services must meet stringent requirements and we must develop our products and services solutions quickly to keep pace with the rapidly changing market. Product and services as sophisticated as ours could contain undetected errors or defects, especially when first introduced or when new equipment or versions of our software are released. If our product and services are not free from errors or defects, we may incur an injury to our reputation, lost revenues, diverted development resources, increased customer service and support costs, product recalls and litigation. The costs incurred in correcting any product errors or defects may be substantial and could adversely affect our business, results of operations and financial condition.

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Due to the low temperatures at which some of our products are used and the fact that some of our products are relied upon by our customers or end users in their facilities or operations or are manufactured for relatively broad medical, transportation, or consumer use, we face an inherent risk of exposure to claims in the event that the failure, use, or misuse of our products results, or is alleged to result, in death, bodily injury, property or sample damage, or economic loss. In addition, we specialize in the secure storage of biological specimens, materials and samples covering the full range of temperatures from cryogenic through controlled room temperature. Any damage to these specimens, materials and samples may be attributed to a failure of our storage systems or services, which could lead to claims for damages made by customers and could also harm our relationship with customers and damage our reputation in the life sciences industry, resulting in material harm to our business.

Although we currently maintain product liability coverage, which we believe is adequate for product liability claims and for the continued operation of our business, it includes customary exclusions and conditions, may not cover certain specialized applications and generally does not cover warranty claims. Additionally, such insurance may become difficult to obtain or be unobtainable in the future on terms acceptable to us. A successful product liability claim or series of claims against us, including one or more consumer claims purporting to constitute class actions or claims resulting from extraordinary loss events, in excess of or outside our insurance coverage, or a significant warranty claim or series of claims against us, could materially decrease our liquidity, impair our financial condition, and adversely affect our results of operations. See “—Risks Related to Our Business—Our products and services may expose us to liability in excess of our current insurance coverage” for additional information.

In addition, regardless of merit or eventual outcome, product liability claims may result in, among other things, costs of litigation, distraction of management’s attention from our primary business, the inability to commercialize our existing or new products, decreased demand for our products or, if cleared or approved, products in development, damage to our business reputation, product recalls or withdrawals from the market, withdrawal of clinical trial participants, substantial monetary awards to patients or other claimants, or loss of revenue.

While we may attempt to manage our product liability exposure by proactively recalling or withdrawing from the market any defective products, any recall or market withdrawal of our products may delay the supply of those products to our customers and may impact our reputation. We can provide no assurance that we will be successful in initiating appropriate market recall or market withdrawal efforts that may be required in the future or that these efforts will have the intended effect of preventing product malfunctions and the accompanying product liability that may result. Additionally, any recall could result in significant costs to us and significant adverse publicity, which could harm our ability to market our products in the future. Such recalls and withdrawals may also be used by our competitors to harm our reputation for safety or be perceived by patients as a safety risk when considering the use of our products. Though it may not be possible to quantify the economic impact of a recall, it could have a material adverse effect on our business, financial condition and results of operations.

Additionally, for some of our products we offer a limited warranty for product returns which are due to defects in quality and workmanship. We attempt to estimate our potential liability for future product returns and establish reserves on our financial statements in amounts that we believe will be sufficient to address our warranty obligations; however, our actual liability for product returns may significantly exceed the amount of our reserves. If we underestimate our potential liability for future product returns, or if unanticipated events result in returns that exceed our historical experience, our financial condition and operating results could be materially and adversely affected.

The global pandemic caused by COVID-19 has already and may continue to adversely affect our business operations, financial performance and results of operations, the extent of which is uncertain and difficult to predict.

In late 2019, a novel strain of coronavirus (“COVID-19”) was reported to have surfaced in Wuhan, China, which has since spread globally. In March 2020, the World Health Organization declared COVID-19 a global pandemic. The pandemic has negatively impacted the global economy, disrupted global supply chains and reduced workforce participation. Further, the COVID-19 outbreak has resulted in government authorities around the world implementing numerous measures to try to reduce the impact of COVID-19, such as travel bans and restrictions, quarantines, shelter in place or total lock-down orders. Many countries around the world have also implemented the temporary closure of non-essential businesses and other material limitations on the conduct of business.

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More recently, new variants of COVID-19, such as the Delta and Omicron variants, that are significantly more contagious than previous strains, have emerged. The spread of these new strains are causing many government authorities and businesses to reimplement prior restrictions, or impose new restrictions, in an effort to lessen the spread of COVID-19 and its variants. In addition, virus containment efforts as a result of governmental actions or policies or other initiatives have led to the disruption in the global supply chain and as a result, we have experienced difficulties sourcing materials and equipment and may incur additional direct costs to provide our solutions in the future. As a result of the COVID-19 outbreak and the related responses from government authorities, our business operations, financial performance and results of operations were adversely affected in 2020 due to reduced demand for our services in all markets. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations–Recent Developments – Impact of COVID-19” for additional information.

Additionally, our business operations, financial performance and results of operations have been and could be further adversely impacted in a number of ways, including, but not limited to, the following:

The spread of COVID-19 has caused us to modify our business practices (including employee travel, employee work locations, and cancellation of physical participation in meetings, events and conferences), and we may take further actions as may be required by government authorities or that we determine are in the best interests of our employees, customers, partners, and suppliers. There is no certainty that such measures will be sufficient to mitigate the risks posed by the virus, and our ability to perform critical functions could be harmed.

Additionally, COVID-19 could negatively affect our internal controls over financial reporting as a portion of our workforce is required to work from home and therefore new processes, procedures, and controls could be required to respond to continuing changes in our business environment. Further, should any key employees become ill from COVID-19 and unable to work, the attention of the management team could be diverted.

The potential effects of COVID-19 may also impact and potentially heighten many of our other risk factors discussed in this “Risk Factors” section. The degree to which COVID-19 impacts our business operations, financial performance and results of operations will depend on future developments, which are highly uncertain, continuously evolving and cannot be predicted, including, but not limited to, the duration and spread of the COVID-19 outbreak and its variants; its severity; the actions to contain the virus or treat its impact, such as the availability and efficacy of vaccines (particularly with respect to emerging strains of the virus), and the potential hesitancy to utilize them; and how quickly and to what extent normal economic and operating conditions can resume.

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As an increasingly global business, we are exposed to economic, political, and other risks in different countries which could materially reduce our sales, profitability or cash flows, or materially increase our liabilities.

Since we manufacture and sell our products worldwide, our business is subject to risks associated with doing business internationally. Our future results could be harmed by a variety of factors, including:

● difficulty in staffing and managing geographically widespread operations;

● difficulty in collecting international accounts receivable;

● difficulty in enforcement of contractual obligations under non-U.S. law;

● transportation delays or interruptions; and

We will have difficulty increasing our revenues if we experience delays, difficulties or unanticipated costs in establishing the sales, marketing and distribution capabilities necessary to successfully commercialize our solutions.

We plan to further enhance our sales, marketing and distribution capabilities in the Americas, EMEA, and APAC. It will be expensive and time-consuming for us to develop and integrate our global marketing and sales network and thus we intend to further broaden our strategic alliances with domestic and international providers of shipping services and other solutions providers to the life sciences industry to incorporate use of our platform of solutions in their service offerings. We may not be able to provide adequate incentive to our sales force or to establish and maintain favorable distribution and marketing collaborations with others to promote our solutions. In addition, any third party with whom we have established a marketing and distribution relationship may not devote sufficient time to the marketing and sales of our solutions, thereby exposing us to potential expenses in exiting such distribution agreements. We, and any of our alliance partners, must also market our services in compliance with federal, state, local and international laws relating to the provision of incentives and inducements. Violation of these laws can result in substantial penalties. Therefore, if we are unable to successfully motivate and expand our marketing and sales force and further develop our sales and marketing capabilities, or if our alliance partners fail to promote our solutions, we will have difficulty increasing our revenues and the revenue may not offset the additional expense of expansion.

We expect to base our equipment and inventory purchasing decisions on our forecasts of customers’ demand, and if our forecasts are inaccurate, our operating results could be materially harmed.

As our customer base increases, we expect the need to purchase additional equipment and inventory. Our forecasts will be based on multiple assumptions, each of which may cause our estimates to be inaccurate, affecting our ability to provide products to our customers. When demand for our products increases significantly, we may not be able to meet demand on a timely basis, and we may need to expend a significant amount of time working with our customers to allocate limited supply and maintain positive customer relations, or we may incur additional costs in order to rush the manufacture and delivery of additional products. If we underestimate customers’ demand, we may forego revenue opportunities, lose market share and damage our customer relationships. Conversely, if we overestimate customer demand, we may purchase more equipment and inventory than we are able to use or sell at any given time or at all. As a result of our failure to properly estimate demand for our products, we could have excess or obsolete equipment and/or inventory, resulting in a decline in the value of our equipment and/or inventory, which would increase our costs of revenues and reduce our liquidity. Our failure to accurately manage our equipment purchases and inventory relative to demand would adversely affect our operating results.

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If we suffer a disruption or loss to our factories, facilities or distribution system due to factors outside of our control, our operations could be seriously harmed.

We rely on our distribution system including third-party shipment and carrier services to transport our shippers containing biological material. These third-party operations could be subject to natural disasters, adverse weather conditions, other business disruptions, and carrier error, which could cause delays in the delivery of our shippers, which in turn could cause serious harm to the biological material being shipped. As a result, any prolonged delay in shipment, whether due to technical difficulties, power failures, break-ins, destruction or damage to carrier facilities as a result of a natural disaster, fire, or any other reason, including as a result of the COVID-19 pandemic, could result in damage to the contents of the shipper.

Additionally, our factories and facilities may be subject to catastrophic loss due to fire, flood, terrorism, increasing severity or frequency of extreme weather events, or other natural or man-made disasters, as well as disruptions due to a widespread outbreak of an illness or any other public health crisis, such as the COVID-19 pandemic. For example, certain components of our key products are manufactured in China, and the extent to which our ability to produce such products is affected by COVID-19 will largely continue to depend on future developments, which are highly uncertain and cannot be accurately predicted. See “-Risks Related to Our Business-The global pandemic caused by COVID-19 has already and may continue to adversely affect our business operations, financial performance and results of operations, the extent of which is uncertain and difficult to predict” for additional information. Additionally, we operate facilities that specialize in the secure storage of biological specimens, materials and samples. If natural disasters or similar events, like hurricanes, fires or explosions or large-scale accidents or power outages, were to occur that prevented us from using all or a significant portion of these facilities, damaged critical infrastructure or our customers’ biological samples, or otherwise disrupted operations at such facilities , this could affect our ability to maintain ongoing operations and cause us to incur significant expenses. Insurance coverage may not be adequate to fully cover losses in any particular case.

Our products and services may expose us to liability in excess of our current insurance coverage.

Our platform of products and services involve significant risks of liability, which may substantially exceed the revenues we derive from them. We cannot predict the magnitude of these potential liabilities. We currently maintain general liability insurance and product liability insurance. Claims may be made against us that exceed the limits of these policies.

Our liability policy is an “occurrence” based policy. Thus, our policy is complete when we purchased it and following cancellation of the policy it continues to provide coverage for future claims based on conduct that took place during the policy term. Our insurance coverage, however, may not protect us against all liability because our policies typically have various exceptions to the claims covered and also require us to assume some costs of the claim even though a portion of the claim may be covered. In addition, if we expand into new markets, we may not be aware of the need for, or be able to obtain insurance coverage for such activities or, if insurance is obtained, the dollar amount of any liabilities incurred could exceed our insurance coverage. A partially or completely uninsured claim, if successful and of significant magnitude, could have a material adverse effect on our business, financial condition and results of operations.

If we use biological and hazardous materials in a manner that causes injury, we could be liable for damages.

Our customers may ship potentially harmful biological materials in our dewars. We cannot eliminate the risk of accidental contamination or injury to employees or third parties from the use, storage, handling or disposal of these materials. In the event of contamination or injury, we could be held liable for any resulting damages, and any liability could exceed our resources or any applicable insurance coverage we may have. Additionally, we are subject to, on an ongoing basis, federal, state and local laws and regulations governing the use, storage, handling and disposal of these materials and specified waste products. In the event of an accident, we could be held liable for damages.

We operate in a competitive industry and if we cannot compete effectively, we will lose business.

We expect to continue to experience significant and increasing levels of competition in the future. While there are technological and marketing barriers to entry, we cannot guarantee that these barriers will be sufficient to defend our market share against current and future competitors. Our principal competitive considerations in our market include:

● acceptance of our solutions model;

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● the ability to develop and maintain and expand strategic alliances;

● establishing our brand name;

● our ability to deliver our solutions to our customers when requested; and

● our timing of introductions of new solutions and services.

Our future revenue stream depends to a large degree on our ability to bring new solutions and services to market on a timely basis. We generally sell our products in industries that are characterized by increased competition through frequent innovation, rapid technological changes and changing industry standards. Without the timely introduction of new products, services and enhancements, our products and services may become obsolete over time, in which case our revenue and operating results could suffer.

There may also be other companies which are currently developing competitive products and services or which may in the future develop technologies and products that are comparable, superior or less costly than our own. For example, some specialty couriers and packaging manufacturers with greater resources currently provide temperature-controlled packaging solutions and may develop other products or solutions in the future, both of which compete with our products. A competitor that has greater resources than us may be able to develop and expand their networks and product offerings more quickly, devote greater resources to the marketing and sale of their solutions and adopt more aggressive pricing policies. We may not be able to successfully compete with a competitor that has greater resources, which may adversely affect our business.

If we successfully develop products and/or services, but those products and/or services do not achieve and maintain market acceptance, our business will not be profitable.

The degree of acceptance of our platform of existing products and services or any future products or services by our current target markets, and any other markets to which we attempt to sell our products and services, as well as our profitability and growth, will depend on a number of factors including, among others, our shippers’ ability to perform and preserve the integrity of the materials shipped, relative convenience and ease of use of our shippers and/or Cryoportal®, reliability and effectiveness of our biostorage services, availability of alternative products or new technologies that make our solutions and services less desirable or competitive, pricing and cost effectiveness, effectiveness of our or our collaborators’ sales and marketing strategy and the adoption cycles of our targeted customers.

In addition, even if our products and services achieve market acceptance, we may not be able to maintain that market acceptance over time if new products or services are introduced that are more favorably received than our products and services, are more cost effective, or render our products obsolete. Although we are not aware of any other treatments or methods currently being developed that would directly compete with the methods we employ, there can be no assurance that future developments in technology will not make our technology non-competitive or obsolete, or significantly reduce our operating margins or the demand for our offerings, or otherwise negatively impact our ability to be profitable.

The integration and operation of acquired businesses may disrupt our business and create additional expenses, and we may not achieve the anticipated benefits of the acquisitions.

Integration of an acquired business involves numerous risks, including assimilation of operations of the acquired business and difficulties in the convergence of systems and processes, the diversion of management’s attention from other business concerns, risks of entering markets in which we have had no or only limited direct experience, assumption of unknown or unquantifiable liabilities, difficulties in completing strategic initiatives already underway in the acquired company, and unfamiliarity with partners of the acquired company, each of which could have a material adverse effect on our business, results of operations and financial condition. We cannot assure that these risks or other unforeseen factors will not offset the intended benefits of the acquisitions, in whole or in part.

Additionally, potential acquisition opportunities become available to us from time to time, and we periodically engage in discussions or negotiations relating to potential acquisitions, including acquisitions that may be material in size or scope to our business. Any acquisition may or may not occur and, if an acquisition does occur, it may not be successful in enhancing our business for one or more of the following reasons:

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● We may fail to achieve acquisition synergies; or

Acquisitions and strategic investments and alliances may also require us to integrate and collaborate with a different company culture, management team, business model, business infrastructure and sales and distribution methodology, and assimilate and retain geographically dispersed, decentralized operations and personnel. Depending on the size and complexity of an acquisition, our successful integration of the entity depends on a variety of factors, including introducing new products and meeting revenue targets as expected, the retention of key employees and key customers, increased exposure to certain governmental regulations and compliance requirements and increased costs and use of resources. Further, the integration of acquired businesses is likely to result in our systems and internal controls becoming increasingly complex and more difficult to manage. Any difficulties in the assimilation of acquired businesses into our control system could harm our operating results or cause us to fail to meet our financial reporting obligations.

Even if we are able to successfully integrate acquired businesses, we may not be able to realize the revenue and other synergies and growth that we anticipated from the acquisition in the time frame that we expected, and the costs of achieving these benefits may be higher than what we expected. As a result, the acquisition and integration of acquired businesses may not contribute to our earnings as expected and we may not achieve the other anticipated strategic and financial benefits of such transactions.

Risks Associated with Our Intellectual Property

Our success depends, in part, on our ability to obtain patent protection for our solutions, preserve our trade secrets, and operate without infringing the proprietary rights of others.

Our policy is to seek to protect our proprietary position by, among other methods, filing United States patent applications related to our technology, inventions and improvements that are important to the development of our business. Our patents or patent applications may be challenged, invalidated or circumvented in the future or the rights granted may not provide a competitive advantage. We intend to vigorously protect and defend our intellectual property. Costly and time-consuming litigation brought by us may be necessary to enforce our patents and to protect our trade secrets and know-how, or to determine the enforceability, scope and validity of the proprietary rights of others.

We also rely upon trade secrets, technical know-how and continuing technological innovation to develop and maintain our competitive position. We seek to protect these trade secrets, in part, by entering into confidentiality agreements and inventions assignment and work for hire agreements in connection with employment, consulting, or advisory relationships. Despite these efforts, any of these parties may breach the agreements and disclose our proprietary information, including our trade secrets, and we may not be able to obtain adequate remedies for such breaches. Additionally, our competitors may independently develop substantially equivalent proprietary information and techniques or otherwise gain access to our proprietary technology, or we may not be able to meaningfully protect our rights in unpatented proprietary technology.

Our current and potential competitors and other third parties may have or obtain patents or additional proprietary rights that would prevent, limit or interfere with our ability to make, use or sell our solutions either in the United States or internationally. Additionally, we may face assertions of claims by holders of patents alleging that we are infringing upon their patent rights, which claims may be without merit, but may nonetheless result in our incurring substantial costs of defense.

We rely upon certain critical information systems, including our Cryoportal® software platform, for the operation of our business and the failure of any critical information system could adversely impact our reputation and future revenues and we may be required to increase our spending on data and system security.

We rely upon certain critical information systems, including our Cryoportal®software platform which is used by our customers and business partners to automate the entry of orders, prepare customs documentation and facilitate status and location monitoring of shipped orders while in transit. In addition, the provision of service to our customers and the operation of our networks and systems involve the storage and transmission of significant amounts of proprietary information and sensitive or confidential data, including personal information of customers, employees and others. Our technology infrastructure and critical information systems are subject to damage or interruption from a number of potential sources, including unauthorized intrusions, cyber-attacks, software viruses or other malware, natural disasters, power failures, employee error or malfeasances and other events. Despite our best efforts, no cybersecurity

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or emergency recovery process is failsafe, and if our safeguards fail or our technology infrastructure or critical information systems are compromised, the safety and efficiency of our operations could be materially harmed, our reputation could suffer, and we could face additional costs, liabilities, costly legal challenges. Additionally, an actual or alleged failure to comply with applicable United States or foreign data protection regulations or other data protection standards may expose us to litigation, fines, sanctions or other penalties. We do not have cyber security insurance and we may incur significant costs in the event of a successful cyber-attack against us. The cost and operational consequences of implementing, maintaining and enhancing further data or system protection measures could increase significantly to overcome increasingly intense, complex and sophisticated global cyber threats.

Risks Related to Regulatory and Legal Matters

Complying with certain regulations that apply to shipments using our solutions can limit our activities and increase our cost of operations.

Shipments using our solutions and services are subject to various regulations in the various countries in which we operate. For example, shipments using our solutions may be required to comply with the shipping requirements promulgated by the Centers for Disease Control (“CDC”), the Occupational Safety and Health Organization (“OSHA”), the Department of Transportation (“DOT”) as well as rules established by the IATA and the ICAO. Additionally, our data logger may be subject to regulation and certification by the Food and Drug Administration (“FDA”), Federal Communications Commission (“FCC”), and the Federal Aviation Administration (“FAA”). We will need to ensure that our solutions and services comply with relevant rules and regulations to make our solutions and services marketable, and in some cases, compliance is difficult to determine. Significant changes in such regulations could require costly changes to our solutions and services or prevent use of our shippers for an extended period of time while we seek to comply with changed regulations. If we are unable to comply with any of these rules or regulations or fail to obtain any required approvals, our ability to market our solutions and services may be adversely affected. In addition, even if we are able to comply with these rules and regulations, compliance can result in increased costs. In either event, our financial results and condition may be adversely affected. We depend on our business partners and unrelated and frequently unknown third-party agents in foreign countries to act on our behalf to complete the importation process and to make delivery of our shippers to the final user. The failure of these third parties to perform their duties could result in damage to the contents of the shipper resulting in customer dissatisfaction or liability to us, even if we are not at fault.

Changes in trade policy, tariff and import/export regulations may have a material adverse effect on our business, financial condition and results of operations.

Our international operations and transactions depend upon favorable trade relations between the United States and the foreign countries in which our customers and suppliers have operations. It may be time consuming and expensive for us to adapt to any changes in U.S. or international social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories or countries where we currently sell our products or conduct our business. If such changes occur, it could adversely affect our business.

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We, along with our customers, are subject to various international governmental regulations. Compliance with or changes in such regulations may cause us to incur significant expenses, and if we fail to maintain satisfactory compliance with certain regulations, we may be forced to recall products and cease their manufacture and distribution, and we could be subject to civil or criminal penalties.

We, along with our customers, are subject to various significant international, federal, state and local regulations, including but not limited to regulations in the areas of health and safety, packaging, product content, employment, labor and immigration, import/export controls, trade restrictions and anti-competition. In addition, as a global organization, we are subject to data privacy and security laws, regulations, and customer-imposed controls in numerous jurisdictions as a result of having access to and processing confidential, personal, sensitive and/or patient health data in the course of our business. The EU's General Data Protection Regulation (“GDPR”), which became effective in May 2018, applies to our activities related to products and services that we offer to EU customers and workers. The GDPR established new requirements regarding the handling of personal data and includes significant penalties for non-compliance (including possible fines of up to 4 percent of total company revenue). Other governmental authorities around the world have passed or are considering similar types of legislative and regulatory proposals concerning data protection. Each of these privacy, security and data protection laws and regulations could impose significant limitations and increase our cost of providing our products and services where we process end user personal data and could harm our results of operations and expose us to significant fines, penalties and other damages.

We must also comply with complex foreign and U.S. laws and regulations, such as the U.S. Foreign Corrupt Practices Act, the U.K. Bribery Act, and other local laws prohibiting corrupt payments to governmental officials, anti-competition regulations and sanctions imposed by the U.S. Office of Foreign Assets Control and other similar laws and regulations. Violations of these laws and regulations could result in fines and penalties, criminal sanctions, restrictions on our business conduct and on our ability to offer our products in one or more countries, and could also materially affect our brand, our ability to attract and retain employees, our international operations, our business and our operating results. Although we have implemented policies and procedures designed to ensure compliance with these laws and regulations, there can be no assurance that our employees, contractors, or agents will not violate our policies.

These regulations are complex, change frequently and have tended to become more stringent over time. We may be required to incur significant expenses to comply with these regulations or to remedy any violations of these regulations. Any failure by us to comply with applicable government regulations could also result in the cessation of our operations or portions of our operations, product recalls or impositions of fines and restrictions on our ability to carry on or expand our operations. In addition, because many of our products are regulated or sold into regulated industries, we must comply with additional regulations in marketing our products. Any significant change in these regulations could reduce demand for our products, force us to modify our products to comply with new regulations or increase our costs of producing these products. If demand for our products is adversely affected or our costs increase, our operating results and business would suffer.

We are subject to regulation by the FDA or certain similar foreign regulatory agencies, and failure to comply with such regulations could harm our reputation, business, financial condition and results of operations.

Certain of our operations are subject to regulation by the FDA or similar foreign regulatory agencies. In addition, we may in the future develop products that are subject to regulation as medical devices by the FDA and similar foreign regulatory agencies. For example, we are aware that China’s National Medical Products Administration has had discussions that may require certain of our products to be registered as Class II medical devices. The regulations enforced by the FDA and similar foreign regulatory agencies govern a wide variety of product-related activities, including the research, development, testing, manufacture, quality control, approval, clearance, labeling, packaging, storage, record-keeping, promotion, advertising, distribution, marketing, post-approval monitoring and reporting, pricing, and export and import of pharmaceutical products. If we or any of our customers, suppliers or distributors fail to comply with FDA and other applicable foreign regulatory requirements or are perceived to potentially have failed to comply, we may face, among other things, warning letters; adverse publicity affecting both us and our customers; investigations or notices of non-compliance, fines, injunctions, and civil penalties; import or export restrictions; partial suspensions or total shutdown of production facilities or the imposition of operating restrictions; increased difficulty in obtaining required FDA clearances or approvals or foreign equivalents; seizures or recalls of our products or those of our customers; or the inability to sell our products and services. Any such FDA or other foreign regulatory agency actions could disrupt our business and operations, lead to significant remedial costs and have a material adverse impact on our financial position and results of operations.

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Risks Related to Our Financial Condition

Historically, we have incurred significant losses and we may incur losses in the future.

As of December 31, 2021, we had an accumulated deficit of $467.5 million. In order to achieve and sustain revenue growth in the future, we must expand our market presence and revenues from existing and new customers. We may continue to incur losses in the future and may never generate revenues sufficient to become profitable or to sustain profitability. Continuing losses may impair our ability to raise the additional capital required to continue and expand our operations.

Our indebtedness and liabilities could limit the cash flow available for our operations and expose us to risks that could adversely affect our business, financial condition and results of operations.

We have a substantial amount of indebtedness. As of December 31, 2021, we had approximately $471.1 million of indebtedness and other liabilities, including trade payables, on a consolidated basis. We may also incur additional indebtedness to meet future financing needs. Our indebtedness could have significant negative consequences for our security holders and our business, results of operations and financial condition by, among other things:

● increasing our vulnerability to adverse economic and industry conditions;

● limiting our ability to obtain additional financing;

● limiting our flexibility to plan for, or react to, changes in our business;

Our business may not generate sufficient funds, and we may otherwise be unable to maintain sufficient cash reserves, to pay amounts due under our indebtedness, including our outstanding convertible senior notes (collectively, the “Convertible Senior Notes”) consisting of our 3.00% convertible senior notes due 2025 (the “2025 Convertible Senior Notes”) and our 0.75% convertible senior notes due 2026 (the “2026 Convertible Senior Notes”), and our cash needs may increase in the future. In addition, any future indebtedness that we may incur may contain financial and other restrictive covenants that limit our ability to operate our business, raise capital or make payments under our other indebtedness. If we fail to comply with these covenants or to make payments under our indebtedness when due, then we would be in default under that indebtedness, which could, in turn, result in that and our other indebtedness becoming immediately payable in full.

Risks Related to Our Preferred Stock

The issuance of shares of our Series C Preferred Stock reduces the relative voting power of holders of our common stock, dilutes the ownership of such holders, and may adversely affect the market price of our common stock.