Item 1A. Risk Factors 16
Item 1B. Unresolved Staff Comments 34
Item 1C. Cybersecurity 34
Item 2. Properties 34
Item 3. Legal Proceedings 34
Item 4. Mine Safety Disclosures 34
Part II
Item 6. [Reserved] 35
Item 7A. Quantitative and Qualitative Disclosure About Market Risk 50
Item 8. Financial Statements and Supplementary Data 51
Item 9A. Controls and Procedures 52
Item 9B. Other Information 52
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections. 52
Part III
Item 10. Directors, Executive Officers and Corporate Governance 53
Item 11. Executive and Director Compensation 53
Item 14. Principal Accountant Fees and Services 53
Part IV
Item 15. Exhibits, Financial Statement Schedules 54
SIGNATURES 63
SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain
statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives,
and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words “believes,”
“project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,”
“plan,” “may,” “will,” “would,” “will be,” “will continue,” “will
likely result,” and similar expressions. We intend such forward-looking statements to be covered by the safe-harbor provisions
for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement for
purposes of complying with those safe-harbor provisions. Forward-looking statements are based on current expectations and assumptions
that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements.
Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a
material adverse effect on our operations and future prospects on a consolidated basis include, but are not limited to, changes in economic
conditions, legislative or regulatory changes, availability of capital, interest rates, competition, and unforeseen events that may impair
our ability to advance our clinical programs and raise additional financing. These risks and uncertainties should also be considered
in evaluating forward-looking statements and undue reliance should not be placed on such statements. We undertake no obligation to update
or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Further information
concerning our business, including additional factors that could materially affect our financial results, is included herein and in our
other filings with the Securities and Exchange Commission (“SEC”).
Part
I
Item
1. Business
Introduction
This
Annual Report on Form 10-K should be read together and in connection with the other reports that have been filed by us with the SEC for
a comprehensive description of our financial condition and operating results. In the interest of disclosure, we have included in this
Form 10-K certain material events and developments that have taken place through the date of filing of this Form 10-K with the SEC.
In
this Annual Report on Form 10-K, INVO Fertility, Inc., (INVO Fertility, Inc., together with its subsidiaries, is referred to in this
document as “we”, “us”, “INVO Fertility”, “INVO”, or the “Company”), incorporates
by reference certain information from parts of other documents filed with the SEC. The SEC allows us to disclose important information
by referring to it in that manner. Please refer to all such information when reading this Annual Report on Form 10-K. All information
is as of December 31, 2025, unless otherwise indicated. For a description of the risk factors affecting or applicable to our business,
see “Risk Factors,” below.
The
Company
We
are a healthcare services and technology company focused on the fertility marketplace and dedicated to expanding access to assisted
reproductive technology (“ART”) care to patients in need. Our principal commercial strategy is focused on acquiring,
establishing, and operating fertility clinics and related businesses and technologies. Our acquisition strategy focuses on US-based,
profitable fertility clinics. Our clinics offer a variety of fertility services including in vitro fertilization (“IVF”)
and the intravaginal culture (“IVC”) procedure enabled by our INVOcell® medical device (“INVOcell”). As
of the date of this filing, we have four fertility clinics in the United States. We also continue to engage in the sale and
distribution of our INVOcell technology solution into third-party owned and operated fertility clinics. We also intend to seek out
additional, innovative fertility-focused technologies, to license or acquire in order to utilize within our clinics.
Fertility
Clinics
On February 18, 2026, we completed our acquisition
of Family Beginnings, an Indiana based fertility clinic that offers both IVF and IVC. (See below in Recent Developments for additional
information on the acquisition of Family Beginnings.)
On
August 10, 2023, we consummated the first acquisition of an existing fertility clinic, the Wisconsin Fertility Institute (“WFI”).
As an established and profitable clinic, the closing of the WFI acquisition more than tripled our annual revenue and became a major part
of our clinic-based operations. The acquisition accelerated our transformation from a medical device company to a healthcare services
company and immediately added scale and a significant source of positive cash flow to our operations. The acquisition of profitable fertility
clinics complements our efforts to build new INVO Centers, and we expect to continue this strategy to accelerate overall growth.
On
March 10 and June 28, 2021, we established joint ventures to open INVO Centers in Birmingham, Alabama, and Atlanta, Georgia,
respectively. We established these clinics to increase use of the INVOcell, to accelerate the growth and awareness of the IVC
procedure and to expand the availability of statistical and clinical data supporting its use. These clinics also represent our
initial entry into clinic-based fertility operations and enabled us to expand our revenue per fertility cycle from hundreds of
dollars (from the sale of each INVOcell device) to thousands of dollars, and to significantly advance our path to
building greater scale in our overall operations and to reaching profitability.
INVOcell
Device
Our proprietary INVOcell® device enables
fertilization and early embryo development to occur in vivo within the woman’s body - the world’s first intravaginal
culture (“IVC”) technique of its kind. Unlike IVF, which relies on expensive laboratory incubators, the INVOcell allows
fertilization and early embryo development to take place in the woman’s body and has demonstrated equivalent pregnancy success
and live birth rates as IVF.
While INVOcell remains part of our efforts, our strategy
has expanded to focus more broadly on providing ART services through clinic operations.
Recent
Developments
JAG
Amendment
On
May 27, 2026, we entered into a letter agreement (the “JAG May 2026 Letter”) with JAG Multi Investments LLC (“JAG”)
pursuant to which (i) the maturity date of certain previously issued convertible notes with a principal balance of $660,000 (the “JAG
Notes”) was extended until December 31, 2026, (ii) we agreed to repay the JAG Notes in monthly installments of $50,000 starting
in April 2026 with a balloon payment at the end of December 2026, (iii) confirmation that if we raise more than $3,000,000 after the
date of the JAG May 2026 Letter, we shall pay ten percent (10%) of any proceeds in excess of $3,000,000 to accelerate repayment of the
JAG Notes, (iv) the conversion price of the JAG Notes was reset to $1.60, (v) we agreed to issue to JAG a new warrant (the “JAG
May 2026 Warrant”) to purchase up to 150,000 shares of our common stock at an exercise price of $1.60 per share, exercisable for
five years from the date of issuance, and (vi) we agreed to the reset of the conversion and exercise prices of the JAG Notes and JAG
May 2026 Warrant, respectively, to equal the price of any future financing based on a share price that is lower than the conversion and
exercise prices then in effect.
Nasdaq
On April 23, 2026, we received a letter (the “10-K
Letter”) from the Listing Qualifications staff (the “Staff”) of The Nasdaq Stock Market LLC (“Nasdaq”) indicating
that we failed to file our Annual Report on Form 10-K for the year ended December 31, 2025 (the “10- K Filing”), on a timely
basis and, as such, no longer satisfies Nasdaq Listing Rule 5250(c)(1) (the “Timely Filing Rule”)
On May 27, 2026 we receive an additional letter (the
“10-Q Letter”) from the Staff indicating that we failed to file our Quarterly Report on Form 10-Q for the period ended March
31, 2026 (the “10-Q Filing”), on a timely basis.
Neither letter had an immediate effect on the listing
of our common stock.
Both letters also stated that, in accordance with Nasdaq rules, we have 60 calendar days from the date of the 10-K
Letter to submit a plan to regain compliance with the Timely Filing Rule. Should the Staff accept such plan, it could grant an exception
of up to 180 calendar days from the 10-K Filing’s due date, or until October 13, 2026, to regain compliance.
Reverse Stock Split (March 2026)
On March 25, 2026, we filed a certificate of change
with the Secretary of State of Nevada to effectuate a reverse split of our common stock at a ratio of 1-for-5, and our authorized common
stock was proportionately reduced to 50,000,000 shares from 250,000,000 shares. The reverse stock split took effect on March 27, 2026.
All share information included in this Form 10-K has been reflected as if the reverse stock split occurred as of the earliest period presented
Closing
of Family Beginnings Acquisition
On
February 18, 2026, we completed the acquisition of Family Beginnings P.C., a fertility clinic located in Indianapolis, Indiana. The
transaction was executed through our wholly owned subsidiary Wood Violet Fertility, LLC (“Wood Violet”). The total
purchase price was approximately $760,000, consisting of $360,000 in cash, of which $210,000 was paid at closing, and $400,000 in Series D Preferred
Stock.
As
part of the acquisition structure, we acquired the clinic’s non-medical business assets through Wood Violet, while
the clinic’s medical assets were acquired by Fertility, P.A., which entered into a long-term Management Services Agreement with
Wood Violet. Under this agreement, Wood Violet will provide management, administrative, laboratory, and operational support services
to the clinic for an initial 10-year term, renewable for additional five-year periods. Fertility, P.A. agreed to reimburse Wood Violet for costs incurred in providing such services plus twenty percent
(20%).
In
connection with the acquisition, we also entered into a lease for approximately 4,387 square feet of clinic and office space in Indianapolis,
effective March 1, 2026, with an initial term through July 31, 2033.
Founded
more than a decade ago, Family Beginnings has built a strong reputation for delivering comprehensive fertility services with a highly
personalized, patient-first approach. The clinic offers a full suite of reproductive services, including in vitro fertilization, intravaginal
culture (as an early adopter of our INVOcell solution), ovulation induction, intrauterine insemination, fertility preservation, and diagnostic
testing, supported by an experienced clinical and embryology team. The acquisition expands INVO’s clinical footprint and is expected
to support continued growth of our fertility services platform.
Warrant
Inducement (January 2026)
On January 28, 2026, we entered into an inducement
letter agreement (the “January 2026 Inducement Letter Agreement”) with an institutional investor and existing holder (the
“Holder”) of the Common Warrants (as defined below).
The issuance of the shares of common stock upon exercise
of such the Common Warrants was registered pursuant to a registration statement on Form S-1 (File No. 333-292206), which was declared
effective by the SEC on December 29, 2025.
Pursuant to the January 2026 Inducement Letter Agreement,
the Holder agreed to exercise the Common Warrants for cash at the exercise price of $7.95 per share in consideration for our agreement
to issue new unregistered warrants to purchase up to an aggregate of 1,893,492 shares of common stock at an exercise price of $7.95 per
share. Such new warrants will become exercisable upon receipt of such approval as may be required by the applicable rules and regulations
of the Nasdaq Capital Market (or any successor entity) from the stockholders of INVO with respect to issuance of all of such new warrants
and the shares of common stock upon the exercise thereof and have a term of five and one-half years from the date stockholder approval
is obtained.
We registered the resale of the shares underlying such new warrants pursuant to a registration statement on Form
S-1 (File No. 333-293135), which was declared effective by the SEC on February 12, 2026, and we agreed to observe customary limitations on
additional issuances of common stock and variable-rate financing arrangements for a limited period following the warrant inducement
transaction.
The aggregate gross proceeds to us from the exercise
of such existing warrants was approximately $7.5 million, before deducting offering expenses payable by us.
Maxim
Group LLC (“Maxim”) acted as our financial advisor in connection with the inducement transaction.
Increase
in Authorized Common Stock (Jan 2026)
On
January 22, 2026, our stockholders approved an amendment to our Amended and Restated Articles of Incorporation to increase our number
of authorized shares of common stock from 6,250,000 to 250,000,000 and we filed a Certificate of Amendment to our Articles of Incorporation
to increase our authorized shares of common stock for the same.
Private
Placement (December 2025)
On
December 2, 2025, we entered into a securities purchase agreement with an institutional investor for a private placement of approximately
$4.0 million in securities, comprised of 47,000 shares of Common Stock, pre-funded warrants to purchase 426,373 shares of Common Stock
(the “Pre-Funded Warrants”), and common warrants to purchase 946,746 shares of Common Stock (the “Common Warrants”).
The Common Warrants became exercisable on January 22, 2026 upon receipt of approval from the stockholders of INVO to increase the number of authorized shares of common stock available for issuance
thereunder and as required by the applicable rules and regulations
of the Nasdaq Capital Market (or any successor entity) with respect to issuance of all of such new warrants
and the shares of common stock upon the exercise thereof, expired five years thereafter, and carried an exercise price of $8.45 per share.
The Pre-Funded Warrants were immediately exercisable at $0.0005 per share until exercised in full.
In
connection with the foregoing private placement, we entered into a placement agency agreement with Maxim on a reasonable best efforts
basis, pursuant to which we agreed to pay the Placement Agent a fee equal to 8.0% of gross proceeds, warrants to purchase 23,669 shares
of Common Stock at $10.5625 per share, and reimbursement of expenses up to $50,000.
Net
proceeds from the private placement are being used to support our growth and liquidity needs, including funding a portion of the Family
Beginnings P.C. acquisition, paying certain outstanding debt obligations, and providing additional working capital.
Reverse
Stock Split (Nov 2025)
On
November 26, 2025, we filed a certificate of change with the Secretary of State of Nevada to effectuate a reverse split of our common
stock at a ratio of 1-for-8, and our authorized common stock was proportionately reduced to 6,250,000 shares from 50,000,000 shares.
The reverse stock split took effect on November 28, 2025. All share information included in this Form 10-K has been reflected as if the
reverse stock split occurred as of the earliest period presented.
Pritts
Litigation and Binding Settlement Term Sheet
On
May 7, 2025, Dr. Elizabeth Pritts (“Dr. Pritts”) and the Elizabeth Pritts Revocable Living Trust (the “Pritts Trust”)
filed a complaint in the Circuit Court of the State of Wisconsin, Dane County, against us and our subsidiaries INVO CTR, Wisconsin Fertility
and Reproductive Surgery Associates, S.C., and Wood Violet Fertility LLC (“Wood Violet”). Dr. Pritts and the Pritts Trust
have asserted causes of action arising out of the WFI acquisition documents (the “WFI Documents”) for breach of contract,
breach of the implied covenant of good faith and fair dealing, tortious interference with contract (or, in the alternative, veil piercing),
and unjust enrichment.
On
May 14, 2025, INVO, Dr. Pritts, the Pritts Trust, and certain of their respective affiliates entered into binding term sheet (the “Term
Sheet”) to settle all disputes between the parties pursuant to the terms set forth in the Term Sheet (the “Terms”).
The parties agreed to cooperate in good faith to prepare and enter into a final settlement agreement (the “Settlement Agreement”)
based on the terms set forth in the Term Sheet; provided, however, that unless and until the Settlement Agreement is executed, the Terms
are binding on the parties. Under the Terms, Wood Violet agreed to pay Dr. Pritts $6,000,000 in full and final settlement and satisfaction
of all obligations to Dr. Pritts and her affiliates under the WFI Documents, of which $525,000 was paid concurrently with the execution
of the Term Sheet, and the remainder of which is payable as follows: $475,000 due June 30, 2025, $750,000 due September 30, 2025, $750,000
due December 31, 2025, $1,000,000 due March 31, 2026, $2,000,000 due June 30, 2026, and $500,000 due December 31, 2026. INVO shall provide
Wood Violet with use of 25% of all gross funding proceeds above $2,000,000 raised within any six-month period to accelerate the payment
of scheduled settlement payments in chronological order. The parties will enter into a consent judgment to resolve the complaint that
would come into effect upon any breach of the Settlement Agreement. The parties agreed to settle all disputes, including those related
to employment, acquisition, tax, and related matters, the termination of all employment, consulting, and similar agreements with Dr Pritts,
and other customary terms, including, without limitation, indemnification and release of claims. On September 30, 2025 we executed the
Settlement Agreement.
FNL
Financing Transactions
On
October 11, 2024, we issued a 7.0% Senior Secured Convertible Debenture in the principal amount of $3,934,146, due December 11, 2025
(the “Debenture”), to Five Narrow Lane LP (“FNL”). We became a party to that certain Securities Purchase Agreement,
dated as of January 3, 2024, between FNL and NAYA Therapeutics Inc. (formerly known as NAYA Biosciences, Inc.) (the “Securities
Purchase Agreement”), pursuant to a joinder agreement (the “Joinder Agreement”) on October 11, 2024. FNL was entitled
to convert any portion of the outstanding principal and accrued interest into shares of our common stock at a conversion price of $1,339.992
per share, subject to adjustment, following stockholder approval, provided that conversion could not result in FNL beneficially owning
more than 4.99% of our outstanding common stock. Commencing March 14, 2025, we were required to redeem $437,127.24 of principal, plus
accrued interest, on the 14th of each month until maturity.
Effective
May 23, 2025, we entered into an agreement with FNL (the “May 2025 Amendment and Exchange Agreement”), pursuant to which
the parties agreed to (a) exchange outstanding shares of our Series C-1 Convertible Preferred Stock (the “Series C-1 Preferred”)
held by FNL for shares of our Series C-2 Convertible Preferred Stock (the “Series C-2 Preferred”), (b) amend the Series C-2
Certificate of Designation pursuant to a certificate of amendment (the “Certificate of Amendment to the Series C-2 Certificate
of Designation”), (c) exchange the Debenture for an Amended and Restated Senior Secured Convertible Debenture due February 11,
2026 (the “Amended and Restated Debenture”), and (d) amend the Securities Purchase Agreement to grant FNL the right (the
“Additional Investment Right”), exercisable at any time and from time to time beginning on or after May 23, 2025, to purchase
up to $10,000,000 of aggregate stated value of additional shares of Series C-2 Preferred (the “AIR Preferred Shares”), exercisable
in minimum amounts of $500,000. The AIR Preferred Shares carry the same terms as the Series C-2 Preferred then outstanding, except that
the conversion price upon issuance is deemed to be the lowest of (i) the conversion price then in effect, and (ii) the greater of (x)
the Floor Price (as defined in the Certificate of Amendment to the Series C-2 Certificate of Designation) and (y) 85% of the arithmetic
average of the three lowest VWAPs during the ten trading days prior to exercise. In consideration of the foregoing, we issued 1,029 additional
shares of Series C-2 Preferred to FNL.
On
June 30, 2025, we entered into an Amendment to the Securities Purchase Agreement (the “June 2025 Amendment”) with FNL to
permit FNL to elect, when exercising its Additional Investment Right, to either purchase AIR Preferred Shares for cash (an “AIR
Purchase”) or exchange them for all or a portion of the Amended and Restated Debenture, with the aggregate stated value of AIR Preferred
Shares received in such exchange equal to the principal amount so exchanged plus accrued and unpaid interest thereon (an “AIR Exchange”).
The Amendment also reduced the minimum exercise amount to $200,000. On the same date, we entered into an inducement letter agreement
with FNL (the “AIR Exercise and Reload Agreement”), pursuant to which FNL exercised its Additional Investment Right to acquire
1,800 shares of Series C-2 Preferred with an aggregate stated value of $1,800,000 in exchange for $1,800,000 of principal, plus accrued
and unpaid interest, under the Amended and Restated Debenture. In consideration thereof, we issued 630 additional shares of Series C-2
Preferred to FNL.
Effective
August 21, 2025, we entered into an agreement with FNL (the “August 2025 Amendment and Exchange Agreement”), pursuant to
which the parties exchanged the Amended and Restated Debenture for a Second Amended and Restated Senior Secured Convertible Debenture
due February 11, 2026 (the “Second Amended and Restated Debenture”) with an outstanding principal amount reduced to $1,751,344,
and removed the monthly redemption provisions. In connection therewith, the parties agreed to reduce the outstanding principal by $1,300,000
in exchange for AIR Preferred Shares with an aggregate stated value of $1,300,000, and we issued 325 additional shares of Series C-2
Preferred to FNL.
Effective
September 29, 2025, we entered into an agreement with FNL (the “September 2025 Exchange Agreement”), pursuant to which FNL
exchanged the Second Amended and Restated Debenture for 467 shares of Series C-2 Preferred with an aggregate stated value of $1,334,000.
As a result, the Second Amended and Restated Debenture was paid in full and fully extinguished.
In
addition to the exchanges of outstanding debenture principal, during 2025, FNL exercised the AIR for $2,850,000 in aggregate cash consideration,
for which we issued 2,850 shares of Series C-2 Preferred. As January 31, 2026, all outstanding shares of Series C-2 Preferred have been
converted into shares of our common stock, and all dividends owed under the Series C-2 Preferred have been settled in full.
Decathlon
Amendment
On
September 29, 2023, we, our CEO, Steven Shum as a Key Person (as defined in the Loan Agreement defined below), and the our wholly-owned
subsidiaries Bio X Cell, Inc, INVO Centers LLC, Wood Violet, Fertility Labs of Wisconsin LLC and Orange Blossom Fertility LLC as guarantors
(the “Guarantors”), entered into a Revenue Loan and Security Agreement (the “Loan Agreement”) with Decathlon
Alpha V LP (the “Lender”) under which the Lender advanced a gross amount of $1,500,000 to us.
On
September 24, 2024, we, the Lender, Steven Shum and the Guarantors entered into an amendment to the Loan Agreement (the “First
Amendment to the Loan Agreement”), pursuant to which (i) the Lender approved that certain Standard Merchant Cash Advance Agreement,
dated September 25, 2024 between us and Cedar Advance LLC, and (ii) we agreed to increase the “Minimum Interest” (as defined
in the Loan Agreement) multiples set forth therein by 0.15 effective as of December 1, 2024, if we did not receive equity investment
of at least $1,000,000 by November 30, 2024.
On
October 11, 2024, we, the Lender, Steven Shum and the Guarantors entered into a second amendment to the Loan Agreement (the “Second
Amendment to the Loan Agreement”), pursuant to which we agreed, among other things, to pay down its loan by at least $500,000 and
increase its monthly payments by up to $30,000 if we close a private offering of its securities. We also agreed to retain an investment
banker to pursue a financing or a sale if it fails to meet certain liquidity covenants.
On
August 13, 2025, we, the Lender, Steven Shum and the Guarantors entered into a third amendment to the Loan Agreement (the “Third
Amendment to the Loan Agreement”), pursuant to which (a) the Lender consented to the change of our name to INVO Fertility, Inc.,
(b) the Lender waived the event of default that would result from the entry of judgment pursuant to the Term Sheet with Dr. Pritts and
the Pritts Trust, (c) the parties agreed to an adjusted repayment schedule whereby the monthly payment under the Loan Agreement increased
by $20,000, and (d) we agreed to reimburse the Lender for approximately $17,500 in fees and expenses incurred in connection with the
Third Amendment to the Loan Agreement.
On
September 22, 2025, we, the Lender, Steven Shum, and the Guarantors entered into a restated third amendment to the Loan Agreement (the
“Restated Third Amendment to the Loan Agreement”), pursuant to which and in addition to amendments set forth in the Third
Amendment, since we did not raise the above stated $1 million by November 30, 2024 as required under the Loan Agreement, the Loan Agreement
was amended to reflect an increase of 0.15 to the Minimum Interest multiples set forth in the Loan Agreement.
Increase
in Authorized Common Stock (July 2025)
On
July 23, 2025, our stockholders approved an amendment to our Amended and Restated Articles of Incorporation to increase our number of
authorized shares of common stock from 1,388,888 to 50,000,000 and we filed a Certificate of Amendment to our Articles of Incorporation
to increase our authorized shares of common stock for the same.
Reverse
Stock Split (July 2025)
On July 18, 2025, we filed a certificate of change
with the Secretary of State of Nevada to effectuate a reverse split of our common stock at a ratio of 1-for-3, and our authorized common
stock was proportionately reduced to 1,388,888 shares from 4,166,667 shares. The reverse stock split took effect on July 21, 2025. All
share information included in this Form 10-K has been reflected as if the reverse stock split occurred as of the earliest period presented.
Series
C-2 Preferred Amendments
On May 23, 2025, the Company filed a Certificate of
Amendment that, among other changes, allows holders of Series C-2 Preferred to receive dividends payable in additional shares of Series
C-2 Preferred, subject to specified equity-related conditions. The amendment also updated the mechanics for adjusting the conversion price
of the Series C-2 Preferred in connection with any future issuances of AIR Preferred Shares.
On
June 27, 2025, the Company filed a second amendment to the Series C-2 Certificate of Designation, which restated the rights and preferences
of the Series C-2 Preferred and authorized 20,000 shares with a stated value of $1,000 per share. This amendment also removed certain
redemption features, including the “Bankruptcy Triggering Event” and “Change of Control” redemption rights, as defined therein.
NTI
Divesture
On October 11, 2024, we acquired NAYA Therapeutics,
Inc. with the intent to expand beyond fertility into a broader healthcare portfolio combining our commercial-stage fertility business
with a clinical-stage oncology and autoimmune technology business. Following insufficient stockholder support for key elements of the
transaction at a March 2025 stockholder meeting, and upon advice of counsel, our proxy solicitation firm, and general stakeholder feedback,
we elected to re-focus exclusively on our fertility business.
Effective June 2, 2025, we divested a majority stake in NAYA Therapeutics, Inc. by redeeming all outstanding shares
of Series C-1 Preferred at a redemption price of 113.8558 shares of NAYA Therapeutics Class A Common Stock per share of Series C-1 Preferred
redeemed. We retained 6,300 shares of Series A Preferred Stock of NAYA Therapeutics, representing 19.9% of outstanding common stock on
an as-converted basis, and hold a secured convertible promissory note issued by NAYA Therapeutics on May 28, 2025 in the principal amount
of $4,803,175.
Series
C-1 Preferred Amendment
On
May 28, 2025, we filed with the Nevada Secretary of State a certificate of amendment to the Series C-1 Certificate of Designation pursuant
to which, we are entitled to redeem at our option at any time or from time to time upon not less than 2 calendar days written notice
to the holders prior to the date fixed for redemption thereof, at a redemption price of 113.8558 shares of Class A Common Stock
of NTI for each share of Series C-1 Preferred being redeemed.
Warrant Inducement (April 2025)
On April 30, 2025, we entered into an inducement letter
agreement (the “April 2025 Inducement Letter Agreement”) with FNL as the existing holder of certain existing warrants to purchase
up to 3,882 shares of our common stock. Such existing warrants were originally issued on January 14, 2025, with an exercise price of $1,008.00
per share.
The issuance of the shares of common stock upon exercise
of such existing warrants was registered pursuant to a registration statement on Form S-3 (File No. 333-283872), which was declared effective
by the SEC on January 14, 2025.
Pursuant to the April 2025 Inducement Letter Agreement,
FNL agreed to exercise such existing warrants for cash at the exercise price of $193.20 per share in consideration for our agreement to
issue new unregistered warrants to purchase up to an aggregate of 5,823 shares of common stock at an exercise price of $193.20 per share.
Such new warrants would become exercisable upon receipt of such approval as may be required by the applicable rules and regulations of
the Nasdaq Capital Market (or any successor entity) from the stockholders of INVO with respect to issuance of all of such new warrants
and the shares of common stock upon the exercise thereof and have a term of five years from the date stockholder approval would be obtained.
We received stockholder approval for the issuance of shares of common stock upon exercise of such new warrants on July 23, 2025.
The aggregate gross proceeds to us from the exercise
of such existing warrants was approximately $750,000, before deducting offering expenses payable by us.
Name
Change
On
April 14, 2025, we changed our corporate name to INVO Fertility, Inc., pursuant to an Amendment to Articles of Incorporation filed with
the Nevada Secretary of State on April 14, 2025 (the “Name Change”). Pursuant to Nevada law, a stockholder vote was not necessary
to effectuate the Name Change.
On
April 28, 2025, our common stock ceased trading under the ticker symbol “NAYA” and began trading under our new ticker symbol,
“IVF”, on the Nasdaq Capital Market.
Reverse Stock Split (March 2025)
On February 24, 2025, we filed a certificate of change
with the Secretary of State of Nevada to effectuate a reverse split of our common stock at a ratio of 1-for-12, and our authorized common
stock was proportionately reduced to 4,166,667 shares from 50,000,000 shares. The reverse stock split took effect on March 18, 2025. All
share information included in this Form 10-K has been reflected as if the reverse stock split occurred as of the earliest period presented.
Public Offering
On January 14, 2025, we consummated a public offering
(the “January 2025 Offering”) of 9,455 units (“Units”), each consisting of either one share of common stock, or
one pre-funded warrant to purchase one share of common stock (the “January 2025 PFWs”) in lieu thereof, and one warrant to
purchase one share of common stock at an offering price of $1,008.00 per Unit (the “January 2025 Warrants”). The January 2025
Warrants are exercisable from and after the date of their issuance and expire on the five-year anniversary of such date, at an exercise
price of $1,008.00 per share of common stock. Each January 2025 PFW is immediately exercisable at an exercise price of $0.144 per share
and may be exercised at any time until all of the January 2025 PFWs are exercised in full. In connection with the January 2025 Offering,
we entered into a securities purchase agreement (the “January 2025 SPA”) with certain institutional investors who purchased
Units in this January 2025 Offering.
The securities issued in the January 2025 Offering
were offered pursuant to our registration statement on Form S-1, as amended (File No. 333-283872) (the “January 2025 S-1”),
initially filed by us with the SEC under the Securities Act of 1933, as amended (the “Securities Act”), on December 17, 2024
and declared effective on January 13, 2025.
We closed the January 2025 Offering on January 14,
2025, raising gross proceeds of approximately $9.5 million before deducting placement agent fees and other offering expenses payable.
Also in connection with the January 2025 Offering,
on January 13, 2025, we entered into a placement agency agreement (the “January 2025 PAA”) with Maxim, pursuant to which (i)
Maxim agreed to act as lead placement agent on a “best efforts” basis in connection with the January 2025 Offering, and (ii)
we agreed to pay Maxim an aggregate fee equal to 6.5% of the gross proceeds raised in the January 2025 Offering (or 5.0% in the case of
certain investors) and warrants to purchase up to 1,555 shares of Common Stock at an exercise price of $420.00 per share (the “Maxim
January 2025 Warrants”). The Maxim January 2025 Warrants are exercisable at any time after the six-month anniversary of the closing
date, from time to time, in whole or in part, until five (5) years from the commencement of sales of the securities in the January 2025
Offering. Additionally, we reimbursed Maxim for certain expenses and legal fees up to $90,000.
In
connection with the January 2025 Offering, on January 13, 2025, we entered into a Class C-2 Preferred Stock Redemption Agreement with FNL, pursuant to which we agreed to purchase and acquire from FNL 4,000 shares of our C-2 Preferred
Stock for $4,000,000. Accrued dividends, plus any other accrued payments under the Certificate of Designations for the C-2 Preferred
Stock, remained outstanding.
Operations
Our
critical management and leadership functions are carried out by our management team. In the Fertility Clinic segment, each clinic is
separately staffed with employees necessary to manage daily activities, while most administrative tasks are centralized and handled by
the INVO corporate staff. With respect to the INVOcell Device segment, we have contracted out the manufacturing, assembly, packaging,
and labeling to a medical manufacturing company, sterilization of the device to a sterilization specialist, and storage and shipping
to a third party logistics company.
Wisconsin Fertility Institute
As an established and profitable clinic, WFI has a
full staff, including a reproductive and endocrinology and infertility medical doctor (“REI”), an OBGYN trained to provide
fertility treatment and full complement of medical, laboratory and administration staff. The day to day clinical operations are handled
by the on site staff. Our corporate staff manages finance, accounting, human resources and other overhead responsibilities.
Alabama JV
We established a joint venture partnership in Birmingham,
Alabama (the “Alabama JV”) with HRCFG, LLC (“HRCFG”). The responsibilities of HRCFG’s principals include
providing clinical practice expertise, performing recruitment functions, providing all necessary training, and providing day-to-day management
of the Alabama JV. Our responsibilities include providing funding to the Alabama JV and being the exclusive provider of the INVOcell.
Georgia JV
We formed a joint venture with Bloom
Fertility, LLC (“Bloom”) to establish an INVO Center in Atlanta, Georgia (the “Georgia JV”). The responsibilities
of Bloom include providing all medical services required for the operation of the Georgia JV. Our responsibilities include providing
funding to the Georgia JV, lab services, quality management, and being the exclusive provider of the INVOcell.
INVOcell
To
date, we have completed a series of important steps in the successful development and manufacturing of the INVOcell:
Employees
As
of December 31, 2025, INVO employed 14 full time employees. The clinics employed an additional 26 full time and 2 part time employees.
We also engage consultants to further support our operations.
Market
Opportunity
Fertility
Clinics and INVOcell Device
The
global ART marketplace is a large and growing, multi-billion-dollar industry across the world as increased infertility rates,
greater patient awareness and improving financial incentives, such as insurance and governmental assistance, continue to drive
growth and demand. According to the European Society for Human Reproduction’s 2024 ART Fact Sheet, one in six couples
worldwide experience fertility challenges. Additionally, the worldwide market remains vastly underserved as a high percentage of
patients in need of care continue to go untreated each year for many reasons, but key among them are capacity constraints and cost
barriers. There have been large increases in the use of IVF, with current estimates of approximately 4 million ART cycles performed
globally each year, producing around 1 million babies. Regrettably, this only amounts to less than 5% of the infertile couples
worldwide being treated and less than 2% of such couples having a child though IVF. The industry remains capacity constrained which
creates challenges in providing access to care at an affordable price for the volume of patients in need. A survey by
“Resolve: The National Infertility Association,” indicates the two main reasons couples do not use IVF is cost and
geographical availability (and/or capacity).
In
the United States, infertility affects an estimated 10%-15% of the couples of childbearing-age, according to the American Society of
Reproductive Medicine (2017). According to the Centers for Disease Control (“CDC”), there are approximately 6.7 million women
with impaired fertility. Based on 2022 data from the CDC’s National ART Surveillance System, approximately 435,000 IVF cycles were
performed across ~500 IVF centers, leaving the U.S. with a large, underserved patient population, similar to most markets around the
world.
Our corporate development strategy, which includes
acquiring established existing practices, building new clinics, and expanding our INVOcell device, is designed to take advantage of the
attractive fertility market dynamics of supply and demand.
Competitive
Advantages
INVOcell
Device and Fertility Clinics
Over
the past several years, the principal focus of our commercial efforts has shifted from the distribution of our INVOcell device to the
provision of fertility services through our network of clinics. For the most part, our clinical activities have been focused on secondary
markets where there is a greater imbalance between the need for ART treatment and the number of cycles available. Combined with our ability
to offer a wider range of advanced fertility care, including IVC, IVF and IUI, at multiple price points, our clinics have the opportunity
for differentiation from our competitors. As with our INVOcell technology, we continuously look for new solutions that can create greater
efficiency and effectiveness in the provision of fertility cycles and support our efforts to democratize fertility care.
While
a much smaller part of our current business, we continue to believe that our INVOcell device, and the IVC procedure it enables, can
play a key role in making advanced fertility care more affordable and accessible. We continue to engage with sympathetic third-party
clinics that share our same vision and that use our one-of-a-kind INVOcell device.
Unlike
IVF, where the oocytes and sperm develop into embryos in a laboratory incubator, the INVOcell allows fertilization and early embryo development
to take place in the woman’s body. We believe that the IVC procedure can provide the following benefits:
● A natural and stable incubation environment;
● A more personal, intimate experience in creating a baby; and
● A reduced risk of errors and wrong embryo transfers.
In
both current utilization of the INVOcell, and in clinical studies, the IVC procedure has demonstrated equivalent pregnancy success and
live birth rates as IVF and generally may be offered at a significant discount to IVF cycles.
Sales
and Marketing
Fertility
Clinics
Our
four fertility clinics employ various strategies to build awareness for their services and/or to maintain and grow patient flow and
fertility cycle volume. The principal source of patient flow comes through social media marketing, OBGYN referrals, and patient word
of mouth. Our clinical staff build and maintain relationships with the local OBGYN community, regularly following up with patient OBGYNs to build additional referral flow.
We also conduct regular social and other media campaigns to attract new patients and to build awareness.
At
the corporate level, we seek to build general awareness for our clinical activities and IVC procedure results with a view to drive patients
to our centers and to grow demand for our INVOcell device. These efforts also support our ongoing work to acquire additional IVF clinics in the near term and open new INVO
Centers longer term.
The
acquisition of existing fertility clinics requires less sales and marketing effort compared to opening and establishing new INVO
Centers, as they have established patient flows that can be built upon. When entering a new market with an INVO Center, we leverage
the experience developed in establishing our Alabama and Georgia joint ventures. We employ strategies to secure patient
flow levels that can enable new INVO Centers to become profitable and contribute economically to our overall business as soon as
possible. Primarily, our INVO Centers seek to employ local, reputable physicians with strong ties to the OBGYN community.
INVOcell
Device
Historically,
our approach to marketing INVOcell was focused on identifying partners within targeted geographic regions that we believe could best
support our efforts to expand access to advanced fertility treatment using the INVOcell and IVC procedure for the large number of underserved
infertile people around the world. Those efforts resulted in the execution of a series of distribution agreements with partners across
the globe. More recently, as we shifted our focus to acquiring and establishing fertility clinics, which activities have been centered
in the US, and as a result of the limited traction experienced in international markets, proactive marketing efforts for the INVOcell
have been limited to the United States. In our domestic market, we distribute the INVOcell directly to a number of third-party IVF clinics
and we remain open to pursuing foreign markets that present a realistic opportunity for incremental revenue on a profitable basis.
Competition
Fertility
Clinics and INVOcell Device
Our
fertility clinics, within their own local markets, compete with other local fertility clinics largely on the basis of reputation,
quality of patient care, and general pricing. Our fertility clinics have at least 1 or more competing fertility clinics within a
25-mile radius. We believe each of our existing centers compete effectively on price and quality of care in their respective
markets.
The
fertility treatment regimens with whom the INVOcell and IVC procedure compete when infertile people, in conjunction with their physician,
are choosing the treatment method include drug-only stimulation, IUI, and conventional IVF. The fertility industry is highly competitive
and characterized by long-standing well-entrenched procedures. Our INVOcell device enables the first new advanced treatment incubation
alternative in over forty years. We face competition from all ART practitioners and device manufacturers. To date, most advancements
in the ART market have been limited to incremental improvements to the various products designed to simply support conventional IVF.
The only ART medical device competitors for INVOcell
that we are aware of are intrauterine devices called AneVivoTM, developed by Anecova, and UteroPodTM, developed by invoLab SA,
both Swiss life sciences companies. The principal difference between the INVOcell and these devices is the latter’s placement inside
the woman’s uterus for early embryo development. We believe that placing the device in the uterus is more invasive and thus may
increase the risk to patients compared to the INVOcell, which is placed in the vaginal cavity. It appears that Anecova is no longer active.
For
additional information about competition, see Risk Factors in Item 1A of this Annual Report on Form 10-K.
Government
Regulation
With
respect to our Clinic Segment, all our clinics are subject to standard governmental and oversight regulations and must meet certain standards
to be certified and operational.
With
respect to our INVOcell segment, in November 2015, the FDA granted our petition for de novo classification of the INVOcell. Special controls
include clinical and non-clinical performance testing, biocompatibility, sterility and shelf-life testing, and labeling. These special
controls also apply to competing products that seek 510(k) clearance under the classification regulation for IVC systems, including our
own 510(k) effort to expand the labeling on INVOcell from a 3-day incubation period to up to a 5-day incubation period. In June 2023,
we received FDA 510(k) clearance to expand the labeling on the INVOcell device and its indication for use to provide for a 5-day incubation
period.
We
are not actively targeting international markets for INVOcell, although we are willing to engage with potential foreign partners that
seek us out and demonstrate a commitment to apply sufficient resources to develop their specific market. Every country has its own, often
different regulatory and registration requirements for medical devices, and our decision to support a potential partner will also be
based on those requirements.
In
general, we may be subject to healthcare fraud, waste, and abuse regulation and enforcement by the federal government and the governments
in the states and foreign countries in which we might conduct our business. The federal laws and many state laws generally apply only
to entities or individuals that provide items or services for which payment may be made under a government healthcare program. These
include laws that prohibit the following:
These
laws are subject to extensive and increasing enforcement by numerous federal, state, and local government agencies including the Office
of Inspector General, the Department of Justice, the Centers for Medicare & Medicaid Services, and various state authorities. At
present, our products and services are not reimbursable under any government healthcare program. If, however, that changes in the future
and it were determined that we were not in compliance with these federal fraud, waste, and abuse laws, we would be subject to liability.
We
are subject to the requirements of the Health Insurance Portability and Accountability Act of 1996, the Health Information
Technology for Economic and Clinical Health Act of 2009 (“HITECH Act”), and related implementing regulations (together,
“HIPAA”). Under HIPAA, we must have in place administrative, physical, and technical standards to guard against the
misuse of individually identifiable health information. In the ordinary course of our business with our fertility clinics as Covered Entities as well as with INVO as a Business Associate, we may use, collect, and store sensitive data, including protected
health information (“PHI”). We face risks relative to protecting this critical information, including loss of access
risk, inappropriate disclosure risk, inappropriate modification risk, and the risk of being unable to adequately monitor our
controls. Our information technology and infrastructure may be vulnerable to attacks by hackers or viruses or breached due to
employee error, malfeasance, or other disruptions. Failure to comply with HIPAA, including through a breach of PHI, could result in
penalties and sanctions, and materially harm our business.
For
additional information about government regulation applicable to our business, see Risk Factors in Item 1A.
Intellectual
Property
Fertility
Clinics and INVOcell
We
rely on a combination of copyright and trademark laws in the United States and other countries to obtain and maintain our intellectual
property. In the past, we protected our intellectual property by, among other methods, filing patent applications with the U.S. Patent
and Trademark Office (the “USPTO”) and its foreign counterparts on inventions related to the development of our business.
On February 10, 2026, we were notified that our patent application for a redesign of the INVOcell device, aimed at process improvements
on the IVC procedure, was granted and issued by the USPTO’s (Patent No. 12,544,204).
Our portfolio of U.S. registered trademarks includes
the following:
● Registration No. 4009828 for INVO BIOSCIENCE
● Registration No. 7516572 for LIFE BEGINS WITHIN
For
additional information about our intellectual property, see Risk Factors in Item 1A of this Annual Report on Form 10-K.
Available
Information
Our
primary corporate website is www.invofertility.com. We make available, free of charge through our website, our annual report on Form
10-K, current reports on Form 8-K, quarterly reports on Form 10-Q and each amendment to these reports. Each such report is posted on
our website as soon as reasonably practicable after such report is filed with the SEC via the EDGAR system.
The
information on our websites is not incorporated by reference into this Annual Report on Form 10-K and should not be considered a part
of this Annual Report. Our website address is included in this Annual Report as an inactive textual reference only.