Company: BWAY
Filing Date: 2025-04-22
Form Type: 20-F
Source: 0001171843-25-002347
Chunk: 162

Company: Brainsway Ltd.
Filing Date: 2025-04-22
Form: 20-F
Item: Item 5
Chunk 162
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 costs
of raw materials, including components purchased from our third-party contract manufacturers, and manufacturing and assembly of the components
that we perform ourselves. The entire cost of the Deep TMS system is recognized upon such sales. While we have previously used a third-party
stimulator for our Deep TMS systems, we developed and have received FDA clearance for our own proprietary stimulator for MDD (in May 2018),
OCD (in March 2019), and smoking addiction (in April 2021).

In the case of our other models, including our fixed-fee
lease model, where we maintain ownership of the Deep TMS systems and place our systems at sites for use by our customers, rather than
selling them outright. Cost of revenue for these models includes a significant component of depreciation of the Deep TMS systems. We expect
to continue to own our Deep TMS systems that have been placed under these models for the foreseeable future, which allows us to maintain
our relatively low cost of revenues for those systems.

The cost of revenues for systems that we lease or
sell also includes costs related to personnel, royalties to PHS and Yeda, shipping, and our operations department. We expect our cost
of revenues to increase in absolute dollars to the extent our revenues increase.

  94  

Research and development expenses, net

Research and development expenses, net, consist primarily
of personnel expenses, including salaries and related benefits and share-based compensation for employees, laboratory materials, regulatory
costs, patents, facility costs,תand travel expenses, as well as expenses associated with outsourced professional scientific development
services, and the costs of multi-center and other clinical trials.

We expect to continue to incur research and development
expenses for the foreseeable future as we advance the development of our Deep TMS technology for various neurological and/or addiction
disorders, as well as for various hardware and software development projects related to the Deep TMS system.

Selling and marketing expenses

Selling and marketing expenses consist of marketing and
commercial activities related to the sale and lease of our Deep TMS systems, as well as personnel expenses, including salaries and related
benefits, sales commissions and share-based compensation for employees, collection fees and facility costs. Other significant sales and
marketing costs include conferences, trade shows, and promotional and marketing activities, including direct and online marketing, SEO,
earned media, practice support programs, media campaigns and travel expenses.

While we anticipate relative stability in current headcount
levels for our existing commercial organization