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YoY shift: Neutral
Year-over-year tone shift - average net-tone change across Risk Factors and MD&A vs the prior 10-K. This filing is 0.03pp more bullish than last year's.
Why YoY instead of absolute: the LM lexicon has ~6.6× more negative words than positive (legal/risk-disclosure language is heavy on hedging), so every 10-K reads bearish on raw tone. Year-over-year change strips that bias and surfaces the actual shift in management's framing.
Tone shift by section
The two components the gauge averages: how Risk Factors and MD&A each shifted in net tone versus last year's 10-K. The headline above is their average, so a green needle over a soft section just means the other section carried it.
Risk Factors
+0.24pp
Flat
Net-tone change vs last year's 10-K.
MD&A
-0.18pp
Flat
Net-tone change vs last year's 10-K.
Per-snippet highlights
Sentence-level sentiment highlighting with category and subcategory filters is coming once the snippet-scoring pipeline lands. For now, dig into the actual section text on the Sections tab.
Language change vs prior 10-K
Risk Factors (Item 1A) - words with the biggest YoY frequency increase
Negative rising
unable+4
delay+3
losses+3
limitation+3
adverse+2
Positive rising
able+2
success+2
profitability+2
effective+1
favorable+1
Risk Factors (Item 1A)
17,863 words
ITEM 1A. RISK FACTORS
In addition to other information in this Annual Report on Form 10-K, please consider the following discussion of factors that make an investment in our securities risky. The risks or uncertainties described in this Annual Report on Form 10‑K can materially and adversely affect our business, reputation, stock price, results of operations, cash flows or financial condition. While the risks and uncertainties described below have been grouped under general risk categories, one or more of the categories may be applicable to the risk factors described. The risks and uncertainties described in this Annual Report on Form 10‑K are not the only ones facing us. Additional risks and uncertainties of which we are unaware or that we currently deem immaterial may also become important factors that can harm our business, reputation, stock price, results of operations, cash flows, or financial condition. Some of the factors, events, and contingencies discussed below may have occurred in the past, but the disclosures below are not representations as to whether or not the factors, events or contingencies have occurred in the past, and instead reflect our beliefs and opinions as to the factors, events or contingencies that could materially and adversely affect us in the future.
Language change vs prior 10-K
MD&A (Item 7) - words with the biggest YoY frequency increase
Negative rising
restructuring+11
litigation+5
ceasing+5
decline+4
divestiture+3
Positive rising
efficiencies+2
effective+1
improve+1
improving+1
MD&A (Item 7)
7,894 words
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our historical consolidated financial statements and the related notes thereto included in this Annual Report on Form 10-K. In addition to historical information, some of the information contained in this discussion and analysis or set forth under Part I, Item 1 , “Business” and elsewhere in this Annual Report on Form 10-K, including information with respect to our plans and strategy for our business and related financing, includes forward‑looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in Part I, Item 1A “Risk Factors” section of this Annual Report on Form 10-K, our actual results could differ materially from the results described in or implied by the forward‑looking statements contained in the following discussion and analysis or elsewhere in this Annual Report on Form 10-K. For a discussion and analysis of our results of operations for the year ended December 31, 2024 compared to the year ended December 31, 2023, please refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2024.
Overview
Unless otherwise noted or required by context, use of “Assertio,” the “Company,” “we,” “our” and “us” refer to Assertio Holdings and/or its applicable subsidiary or subsidiaries. Reference to “Assertio Specialty” refers to Assertio Specialty Pharmaceuticals, LLC, and “Spectrum” refers to Spectrum Pharmaceuticals, Inc. and/or its applicable subsidiary or subsidiaries. Both Assertio Specialty and Spectrum are wholly-owned subsidiaries of the Company. Additionally, the use of “Assertio Therapeutics” refers to Assertio Therapeutics, Inc., and/or its applicable subsidiary or subsidiaries. Assertio Therapeutics was on May 9, 2025.
Sales of ROLVEDON depend on coverage and reimbursement from third-party payors, including under the Medicare Part B Average Sales Price (“ASP”) payment methodology, and a failure to obtain or a reduction in the coverage and/or reimbursement for our products, including as a result of disputes with government agencies regarding our submitted ASP data for ROLVEDON, which is subject to assumptions that may be challenged, could have a material adverse impact on our product sales, business and results of operations.
Sales of ROLVEDON are dependent on the availability and extent of coverage and reimbursement, or level of reimbursement, from third-party payors, including government programs and private insurance plans. Governments and private payors may regulate prices, reimbursement levels and/or access to our products to contain costs or to affect levels of use. We rely in large part on the reimbursement of ROLVEDON through government programs such as Medicare and Medicaid in the U.S., and a failure to obtain or a reduction in the coverage and/or reimbursement for our products could have a material adverse effect on our product sales, business and results of operations. Failure to obtain, or a reduction in, coverage and/or reimbursement for our products may also lead to patients having to pay more or pay entirely out-of-pocket for ROLVEDON. If patients are unwilling to pay more or entirely out-of-pocket for ROLVEDON as a result of a reduction in, or lack of, coverage or reimbursement, it could have a material adverse effect on our product sales, results of operations, and cash flows.
Further, a substantial portion of our ROLVEDON business relies on reimbursement to customers by the U.S. federal government utilizing ROLVEDON’s Medicare Part B ASP payment methodology, which declines based on discounts and other pricing concessions made by manufacturers. These discounts and other pricing concessions are necessary to remain competitive in the long-acting G-CSF market. Most of our products furnished to Medicare beneficiaries in both a physician office setting and hospital outpatient setting will be reimbursed under ASP payment methodology. ASP-based reimbursement of ROLVEDON under Medicare may be below, or could fall below, the cost that some medical providers pay for such products, which could materially and adversely affect sales of ROLVEDON. We also face risks relating to the reporting of pricing data that affect the U.S. reimbursement of and discounts for our products. ASP data are calculated by the manufacturer based on a
formula defined by statute and regulation and are then submitted to the Centers for Medicare and Medicaid Services (“CMS”), the agency responsible for administering the Medicare program, on a quarterly basis.
CMS uses those ASP data to determine the applicable reimbursement rates for ROLVEDON under Medicare Part B. However, government price reporting and payment regulations are complex, and we are continually assessing the methods by which we calculate and report pricing in accordance with these requirements. The applicable statutes, regulations and guidance do not define specific methodologies for all aspects of reporting applicable data. As a result, we are required to apply our reasonable judgment to certain aspects of calculating ASP data and other government price reporting metrics. While we believe our methodologies for calculations are reasonable, such calculations are inherently subject to assumptions, including assumptions related to our efforts to consolidate operations and align ROLVEDON under a single subsidiary, Assertio Specialty. These calculations may be subject to review and challenge by various government agencies, which may disagree with our calculations. If our submitted ASP or other government price reporting data are incorrect, we may need to restate previously reported data and could become subject to substantial fines and penalties or other government enforcement actions, which could have a material adverse impact on our product sales, business and results of operations.
If we are not successful in driving the growth in sales and profitability of ROLVEDON, our business, financial condition and results of operations will be materially and adversely affected.
Our future success is highly dependent on the commercial success of ROLVEDON, and there is greater reliance on ROLVEDON sales and profitability for the Company. Any failure to successfully grow or maintain sales and profitability of ROLVEDON would likely have a material and adverse impact on our business. In addition, if any of the national distributors who previously participated in the large purchases of ROLVEDON in the third quarter of 2025 to ensure consistent supply of ROLVEDON (as noted in Item 1. Business above) do not purchase, or purchase less than, their historical volumes of ROLVEDON once sales of our newly labeled ROLVEDON commence, it would have a material adverse impact on our business. If the markets or patient subsets that we are targeting are not as significant as we estimate, or if we are unable to maintain and grow our market share or are unable to maintain or expand our pricing, we may not generate significant growth in revenues from sales of ROLVEDON. The commercial success of ROLVEDON depends on a number of factors, including the following:
• our ability to successfully execute a commercial strategy focusing on clinics and hospitals;
• patient demand for ROLVEDON;
• the extent to which the results from the ROLVEDON same-day dosing trial is recognized in the National Comprehensive Cancer Network guidelines, which may support or enhance our commercialization efforts;
• coverage and reimbursement from third-party payors;
• our partners’ ability to consistently manufacture ROLVEDON on a timely basis and supply product to us on commercially acceptable terms;
• achieving and maintaining, and, where applicable, ensuring that our third-party contractors achieve and maintain, compliance with our contractual obligations and with all regulatory requirements applicable to ROLVEDON;
• the prevalence, duration and severity of potential side effects or other safety issues that patients may experience with ROLVEDON;
• the differentiation of ROLVEDON from other available approved or investigational drugs and treatments for patients with chemotherapy-induced neutropenia, and the willingness of physicians, operators of hospitals and clinics and patients to adopt and utilize ROLVEDON;
• our ability to establish and enforce intellectual property rights in and to ROLVEDON; and
• our ability to avoid third-party patent interference, intellectual property challenges or intellectual property infringementclaims.
If we are not successful in commercializing our products, our business, financial condition and results of operations will be materially and adversely affected.
If we are unable to successfully market our products, we will not be able to maintain or increase our revenues and our business, financial condition and results of operations will be materially and adversely affected. In addition to the risks discussed elsewhere in this section, our ability to successfully commercialize and generate revenues from our products depends on a number of factors, including, but not limited to, our ability to:
• develop and execute our sales, marketing and promotional strategies for our products;
• achieve, maintain and grow market acceptance of, and demand for, our products;
• obtain and maintain adequate coverage, reimbursement and pricing from managed care, government and other third-party payors;
• adapt our commercial strategies while minimizing disruption of relationships with prescribers and other decision-makers;
• maintain, manage or scale the necessary sales, marketing, manufacturing, managed markets and other capabilities and infrastructure that are required to successfully integrate and commercialize our products;
• obtain adequate supply of our products;
• maintain and extend intellectual property protection for our products; and
• comply with applicable legal and regulatory requirements.
We depend on one qualified supplier for the API in each of our products, and we depend on third parties that are single source suppliers to manufacture our products. Insufficient availability of our products, the API or other raw materials necessary to manufacture our products, or the inability of our suppliers to manufacture and supply our products on commercially reasonable terms, will adversely impact our sales and/or margins upon depletion of our API and product inventories.
We have one qualified supplier for the API in each of our products and have single source suppliers for the manufacture of our products. We do not have, and we do not intend to establish in the foreseeable future, internal commercial-scale manufacturing capabilities. Rather, we intend to use the facilities of third parties to manufacture products for commercialization and clinical trials. Our dependence on third parties for the manufacture of our products and any future product candidates may adversely affect our ability to obtain such products on a timely or competitive basis, if at all. Any stock out, quality concern or failure to obtain sufficient supplies of our products, or the necessary APIs, excipients or components, from our suppliers, including as a result of disruptions to supplier operations resulting from factors such as supply chain delays, public health emergencies, climate events or political unrest, or failures by us to satisfy minimum order requirements due to declines in product demand or otherwise, would adversely affect our business, results of operations and financial condition.
We, our third-party manufacturers and our suppliers are subject to numerous regulations, including current FDA regulations governing manufacturing processes, stability testing, record keeping, product serialization and quality standards. Similar regulations are in effect in other countries. The manufacturing process for pharmaceutical products is highly regulated, and regulators may from time to time shut down manufacturing facilities that they believe do not comply with their regulations. Our third-party manufacturers and suppliers are independent entities who are subject to their own operational and financial risks which are out of our control. If we or any third-party manufacturer or supplier fails to perform as required or fails to comply with the regulations of the FDA and other applicable governmental authorities, or if our manufacturers and/or their suppliers demand higher prices, our ability to deliver adequate supplies of our products to our customers on a timely basis and on commercially reasonable terms, or to conduct clinical trials, could be adversely affected. For example, in October 2023, the drug product manufacturer for ROLVEDON demanded a significant price increase despite fixed pricing provisions in our supply agreement through the latter half of 2025. We renegotiated supply to meet our demands into 2027 and had to accept higher prices than were previously contracted for. Subsequently, on October 7, 2025, we entered into an amendment of the supply agreement that fixes the price that we pay for the remaining term of the agreement. Additionally, although we have fixed pricing with our contract manufacturer for INDOCIN suppositories through July 2028, we understand the API provider to our INDOCIN contract manufacturer has demanded a significant price increase to continue supplying API to our contract manufacturer on a purchase order basis. We may be subject to similar demands for higher prices from our suppliers in the future, which could adversely affect our business, results of operations and financial condition.
We are assessing the legal and business implications of these circumstances and cannot predict how they may ultimately be resolved. The manufacturing processes of our third-party manufacturers and suppliers may also be found to violate the proprietary rights of others. To the extent these risks materialize and adversely affect such third-party manufacturers’ and/or suppliers’ performance obligations to us, and we are unable to contract for a sufficient supply of required products on acceptable terms, or if we encounter delays and difficulties in our relationships with manufacturers or suppliers, our business, results of operations and financial condition could be adversely affected.
A number of our products, including the INDOCIN products and Cambia, are facing competition from generics, which adversely affects our business. Approval of additional generic or biosimilar versions of our products would have a further adverse effect on our business.
At the present time, the FDA will not accept an application for a biosimilar or interchangeable product based on ROLVEDON as the reference biological product until four years after the date of first licensure of the reference product (i.e., September 2026), and the FDA will not approve an application for a biosimilar or interchangeable product based on the reference biological product until 12 years after the date of first licensure of the reference product (i.e., September 2034). However, during this 12-year period of exclusivity, another company may still develop and receive approval of a competing biologic, provided that their application does not rely on the reference product or our data and is not submitted as a biosimilar application. If the patents covering ROLVEDON (which, not accounting for any patent term adjustment, patent term extension, or pediatric extensions that may be available, expire in 2039) are not upheld in litigation or if a biosimilar or other competing biologic is found not to infringe these patents, the resulting competition for ROLVEDON would have an adverse effect on our business, financial condition and results of operations.
Under the FDCA, the FDA can approve an abbreviated new drug application (“ANDA”) for a generic version of a branded drug without the ANDA applicant undertaking the clinical testing necessary to obtain approval to market a new drug. In place of such clinical studies, an ANDA applicant usually needs only to submit data demonstrating that its product has the same active ingredient(s) and is bioequivalent to the branded product, in addition to any data necessary to establish that any difference in strength, dosage, form, inactive ingredients or delivery mechanism does not result in different safety or efficacy profiles, as compared to the reference drug.
There are no patents covering our INDOCIN products (which accounted for 16% and 21% of our Total revenues in 2025 and 2024, respectively), which allows a generic drug company to introduce a generic alternative for these drugs at any time. Over the past several years, generic versions of our INDOCIN products have been approved and launched, and as a result, we are currently facing competition from these generics. In addition, we are aware of other drug companies that have had interactions with regulatory agencies including the FDA relating to indomethacin, which could indicate the development of additional INDOCIN product generics or other formulations of indomethacin and, as a result, we could face competition from additional generics. As a result of the generic competition, net product sales of INDOCIN have declined as we have lost significant market share and have had to provide pricing concessions to certain customers.
In addition, we also face competition for INDOCIN products from hospitals and other institutions, including a 503B outsourcing facility (commonly referred to as a 503B compounder), which began compounding 100 mg indomethacin suppositories in 2022 in what we believe to be violation of state and federal requirements for new drugs and labeling requirements related to adequate directions for use. For a 503B compounder to qualify for exemptions from these state and federal requirements, the 503B compounder must meet certain conditions set forth in Section 503B of the FDCA. We believe that the 503B compounder compounding 100 mg indomethacin suppositories does not meet these conditions. While indomethacin is included on the FDA’s Category 1 list of bulk substances it is evaluating, it is not on the FDA’s list of bulk substances for which there is a clinical need and INDOCIN suppositories are not on the FDA’s drug shortage list either. We also believe that the 100 mg indomethacin suppositories being compounded are essentially a copy of our FDA-approved INDOCIN suppositories. We cannot guarantee that we will be successful in causing the 503B compounder to discontinue sales of its unapproved indomethacin suppository product. We filed an unfair competition lawsuit in the U.S. District Court (Southern District of Texas) against this 503B compounder, which was dismissed on September 27, 2023. We appealed this decision, and on April 10, 2025, the Fifth Circuit Court of Appeals reversed the dismissal in our favor. Thereafter, following the 503B compounder’s petition for certiorari, on January 12, 2026 the U.S. Supreme Court invited the U.S. Solicitor General to file a brief expressing the views of the U.S., which is still pending.
With respect to CAMBIA, which is included in Other net product sales, generic versions of this product have been approved and launched in the U.S. and as a result, we currently face competition from generic versions of CA MBIA. In addition, our partner Searchlight, commercializes a specific formulation of CAMBIA in Canada. The patents underlying the li cense agreement that we have with Searchlight expire in June 2026, and we anticipate that there will be generic competition in Canada after the patents expire, or the earlier negotiated launch of generics in Canada in connection with the settlement of patent litigation. As a result, we anticipate the amount of royalty revenue earned under the license agreement could be reduced to zero beginning in the third quarter of 2026.
The introduction of known and potential additional generic versions of our products, as well as sales of indomethacin suppositories by compounders, or disclosure of ANDA filings and/or similar applications in respect to any of our products, have and in the future could adversely impact our business, financial condition, results of operations and stock price. Moreover, if the
patents covering Sympazan (which expire in 2040) are not upheld in litigation or if a generic competitor is found not to infringe these patents, the resulting generic competition for Sympazan would have a further adverse effect on our business, financial condition and results of operations.
Our commercialization, collaborative and/or licensing arrangements may give rise to disputes over commercial terms, contract interpretation and ownership or protection of our intellectual property and may adversely affect the commercial success of our products.
We currently have, or have had in the past, collaboration or license arrangements with a number of companies, including commercialization or collaborative arrangements, some of which have been based on less definitive agreements, such as memoranda of understanding, material transfer agreements, options or feasibility agreements.
Commercialization, collaborative and licensing arrangements are generally complex and can give rise to disputes regarding the relative rights, obligations and revenues of the parties, including the ownership of intellectual property and associated rights and obligations. Such disputes have arisen in the past from time to time and, if they arise again could delaycollaborative research, development or commercialization of potential products, and can lead to lengthy, expensive litigation or arbitration. The terms of such arrangements may also limit or preclude us from commercializing products or technologies developed pursuant to such collaborations. Additionally, the commercialization, collaborative or licensing partners under these arrangements might breach the terms of their respective agreements or fail to maintain, protect or prevent infringement of the licensed patents or our other intellectual property rights by third parties. Moreover, negotiating commercialization, collaborative and/or licensing arrangements may cause us to enter into less favorable agreement terms that delay or defer recovery of our development costs and reduce the funding available to support key programs. Any failure by our commercialization, collaborative, or licensing partners to abide by the terms of their respective agreements with us (including their failure to accurately calculate, report or pay any royalties payable to either us or a third party or their failure to repay, in full or in part, either any outstanding receivables or any other amounts for which we are entitled to reimbursement) may adversely affect our results of operations.
We are not always able to enter into commercialization, collaborative or licensing arrangements on acceptable terms, which can harm our ability to develop and commercialize our current and potential future products and technologies. Other factors relating to collaborations that may adversely affect the commercial success of our products include:
• any parallel development by a commercialization or collaborative partner of competitive technologies or products;
• arrangements with commercialization or collaborative partners that limit or preclude us from developing products or technologies;
• failure by a commercialization or collaborative partner to devote sufficient resources to the development and commercial sales of products using our current and potential future products and technologies; or
• prematuretermination of a commercialization or collaboration agreement or the inability to renegotiate existing agreements on favorable terms.
Our commercialization, collaborative or licensing arrangements do not necessarily restrict our commercialization, collaborative or licensing partners from competing with us or restrict their ability to market or sell competitive products. Our current and any future commercialization, collaborative or licensing partners may pursue existing or other development-stage products or alternative technologies in preference to those being commercialized or developed in collaboration with us.
In addition, contract disputes with customers or other third parties may arise from time to time. Our commercialization, collaborative, or licensing partners, or customers or other third parties, may also terminate their relationships with us or otherwise decide not to proceed with the development, commercialization or purchase of our products.
We and our commercial partners may be unable to compete successfully in the pharmaceutical and biological product industry.
Competition in the pharmaceutical and biological product industry is intense and we expect competition to increase. Competing products currently under development or developed in the future may prove superior to our products. These products under development, along with currently approved and marketed products, may achievegreater commercial acceptance than our products. Most of our principal competitors have substantially greater financial, sales, marketing, personnel and research and development resources than we and our commercial partners do.
ROLVEDON is a novel long-acting G-CSF that employs a proprietary technology that is designed to prolong the duration of biologics, reducing the frequency of administration. Currently, two other novel long-acting G-CSF and six biosimilar G-CSFs marketed in the U.S. compete with ROLVEDON. In addition, there is one molecular entity that has been approved by the FDA but is not currently marketed that may compete with ROLVEDON.
INDOCIN products compete with currently marketed oral opioids, transdermal opioids, local anesthetic patches, stimulants and implantable and external infusion pumps that can be used for infusion of opioids and local anesthetics, non-narcotic analgesics, local and topical analgesics and anti-arthritics.
Sympazan competes with other generic and branded products in the treatment of LGS, including clobazam tablets and oral solution options. Competition in the LGS marketplace includes branded and generic anti-seizure medications, surgery, neuromodulations, and changes in diet.
SPRIX competes with currently marketed oral opioids, transdermal opioids, local anesthetic patches, stimulants and implantable and external infusion pumps that can be used for infusion of opioids and local anesthetics, non-narcotic analgesics, local and topical analgesics and anti-arthritics. We face and will continue to face competition from other companies in the pharmaceutical, medical devices and drug delivery industries with respect to SPRIX and INDOCIN products.
CAMBIA competes with a number of triptans that are used to treat migraines and certain other headaches. Currently, eight triptans are available generically and sold in the U.S. (almotriptan, eletriptan, frovatriptan, naratriptan, rizatriptan, sumatriptan, sumatriptan-naproxen and zolmitriptan). There are other products prescribed for or under development for the treatment or prevention of migraines that are now or may become competitive with CAMBIA, including CGRP inhibitor products. Certain parties who have entered into settlement agreements with us began to market generic versions of CAMBIA starting in January 2023.
If we are unable to negotiate acceptable pricing or obtain adequate reimbursement for our products from third-party payors, our business will suffer.
Sales of our products depend significantly on the availability of acceptable pricing and adequate reimbursement from third-party payors such as:
• government health administration authorities;
• private health insurers;
• health maintenance organizations;
• managed care organizations;
• pharmacy benefit management companies; and
• other healthcare-related organizations.
If reimbursement is not available for our products or any future product candidates, demand for our products may be limited. Further, any delay in receiving approval for reimbursement from third‑party payors could have an adverse effect on our future revenues.
Third-party payors frequently require pharmaceutical companies to negotiate agreements that provide discounts or rebates from list prices and that protect the payors from price increases above a specified annual limit. We have agreed to provide such discounts and rebates to certain third-party payors, and expect increasing pressure to offer larger discounts and rebates or discounts and rebates to a greater number of third-party payors to maintain acceptable reimbursement levels for and access to our products for patients at co-pay levels that are reasonable and customary. Consolidation among large third-party payors may increase their leverage in negotiations with pharmaceutical companies. If we are forced to provide additional discounts and rebates to third-party payors to maintain acceptable access to our products for patients, our results of operations and financial condition could be adversely affected. If third-party payors or wholesalers do not accurately and timely report the eligibility and utilization of our products under discounted programs, our reserves for rebates or other amounts payable to third-party payors may be lower than the amount we are invoiced and we may be required to dispute the amount payable, which would adversely affect our business, financial condition and results of operations. For example, we have had, and continue to have, disputes with managed care providers over rebates related to our products. Even when rebate claims made by such managed care providers are without merit, we may be forced to pay such disputed amounts to the extent our failure to do so could otherwise adversely impact our business, such as our ability to maintain a favorable position on such provider’s formulary. In addition, if competitors reduce the prices of their products, or otherwise demonstrate that they are better or more cost effective than our products, this may result in a greater level of reimbursement for their products relative to our products,
which would reduce sales of our products and harm our results of operations. The process for determining whether a third-party payor will provide coverage for a product may be separate from the process for setting the price or reimbursement rate that such third-party payor will pay for the product once coverage is approved. Third-party payors have in the past and may in the future limit coverage to specific products on an approved list, or formulary, which might not include all the approved products for a particular indication, including one or more of our products. Any third-party payor decision not to approve pricing for, or provide adequate coverage and reimbursement of, our products, including by reducing, limiting or denying reimbursement for new products or excluding products that were previously eligible for reimbursement, would limit the market acceptance and commercial prospects of our products and harm our business, financial condition and results of operations. In addition, any third-party payor decision to impose restrictions, limitations or conditions on prescribing or reimbursement of our products, including on the dosing or duration of prescriptions for our products, would harm our business, financial condition and results of operations.
Our customer concentration can materially adversely affect our financial condition and results of operations.
We sell a significant amount of our products to a limited number of independent wholesale drug distributors. If we were to lose the business of one or more of these distributors, if any of these distributors failed to fulfill their obligations, if any of these distributors experienced difficulty in paying us on a timely basis, or if any of these distributors negotiated lower pricing or extended payment terms, it could have a material adverse effect on our competitive position, business, financial condition, results of operations and cash flows.
Risks Related to Our Regulatory Environment
We are subject to risks from changes in laws and regulations applicable to, and increased scrutiny and investigations of, the pharmaceutical industry, which can adversely affect our business, financial condition and results of operations.
The manufacture, marketing, sale, promotion, and distribution of our products are subject to comprehensive government regulation. In addition, the recent change in U.S. federal administration has led and is expected to continue to lead to changes in the leadership of various U.S. federal regulatory agencies and changes or proposed or threatened changes to U.S. federal government policy that have led to, in some cases, legal challenges as well as uncertainty around the funding, functioning and policy priorities of U.S. federal regulatory agencies and the status of current and future regulations. U.S. federal government policy changes have included seeking to temporarily broadly halt federal funding, seeking to aggressively downsize the U.S. federal government’s workforce and instructing federal agencies to re-prioritize or to cease operating or enforcing certain laws or regulations. We are unable to predict the extent to which the current U.S. federal administration may impose or seek to impose leadership or policy changes at the U.S. federal regulatory agencies responsible for regulating our business or changes to rules and policies impacting our operations. Any such changes could impose additional costs, require the attention of senior management or result in other changes to or limitations on our business. Government proposals to reduce or eliminate budgetary deficits may include reduced allocations to the FDA, CMS and other related government agencies. These budgetary pressures may reduce the FDA’s and CMS’s ability to perform their responsibilities. For example, the U.S. government shut down in October 2025. During that shutdown, the FDA was not able to accept applications for new drugs, generics, biologics, biosimilars or medical devices that require payment of a user fee. Any delay in the acceptance, review or approval of our investigational new drug applications (“INDs”), clinical trial applications, marketing applications (including NDAs/BLAs and supplements), or facility inspections could delay or increase the cost of our clinical trials, manufacturing scale-up, product launches or post-approval changes. Prolonged U.S. federal government shutdowns could materially delay our regulatory timelines, clinical development, reimbursement decisions and access to capital. Impacts of the government shutdown on CMS, including a pause on most certification, survey activities, delayed rule-making, and a temporary hold on some Medicare claims payments, may also impact our ability to obtain acceptable pricing or adequate reimbursement for our products from such government health programs and our business could be adversely affected.
The regulatory actions described above, as well as the related litigation and investigations, not only create financial and operational pressure on us, but could also put pressure on other companies in our industry and with which we have contractual arrangements. Such pressures could negatively impact our contractual counterparties and may give rise to contract cancellations, breaches or rejections in bankruptcy. Furthermore, in the event that a contract counterparty seeks to reject a contract, we may have an unsecured claim for damages, which may not be paid in full (if at all), and we may be forced to return payments made within 90 days of the date of filing for bankruptcy protection. If any of these events should occur, it may have a material adverse effect on our business, financial condition and results of operations.
Our products, including the marketing of our products, is subject to substantial regulation in the U.S. and any failure by us or our commercial and collaborative partners to comply with applicable statutes or regulations can adversely affect our business.
Our current marketing activities associated with our products, as well as marketing activities related to any other products that we may acquire, or for which we or our collaborative partners obtain regulatory approval, are and will be subject to numerous federal and state laws governing the marketing and promotion of pharmaceutical and biological products. The FDA regulates post-approval promotional labeling and advertising to ensure that they conform to statutory and regulatory requirements. In addition to FDA restrictions, the marketing of prescription drugs is subject to laws and regulations prohibiting fraud and abuse under government healthcare programs. For example, the federal healthcare program anti-kickback statute (“Anti-Kickback Statute”) prohibits giving things of value to induce the prescribing or purchase of products that are reimbursed by federal healthcare programs, such as Medicare and Medicaid. Our arrangements and practices may not, in every case, meet all criteria for applicable exceptions and/or safe harbors for the Anti‑Kickback Statute, and thus would not be immune from prosecution under the statute. Additionally, the Anti‑Kickback Statute and similar state laws are subject to differing interpretations and may contain ambiguous requirements or require administrative guidance for implementation. Finally, some of the safe harbor rules are currently under review for potential revision and may be revised in the future. Given this, our activities could be subject to the penalties under the Anti-Kickback Statute and similar authorities. In addition, federal falseclaims laws prohibit any person from knowingly presenting, or causing to be presented, a false claim for payment to the federal government. Under these laws, in recent years, the federal government has brought claimsagainst drug manufacturers alleging that certain marketing activities caused falseclaims for prescription drugs to be submitted to federal programs. Many states have similar statutes or regulations that apply to items and services reimbursed under Medicaid and other state programs, and, in some states, such statutes or regulations apply regardless of the payor.
Governmental authorities may also seek to hold us responsible for any failure of our commercialization or collaborative partners to comply with applicable statutes or regulations. If we, or our commercial or collaborative partners, fail to comply with applicable FDA regulations or other laws or regulations relating to the marketing of our products, we could be subject to criminalprosecution, civil penalties, seizure of products, injunctions and exclusion of our products from reimbursement under government programs, as well as other regulatory or investigatory actions against our future product candidates, our commercial or collaborative partners or us.
We are subject to numerous ongoing regulatory requirements and continual review with respect to products that have obtained regulatory approval. In addition, the discovery of previously unknown problems with a product or manufacturer may result in restrictions on the product, manufacturer or manufacturing facility, including withdrawal of the product from the market. Manufacturers of approved products are also subject to ongoing regulation and inspection, including compliance with FDA regulations governing cGMP. The FDCA, the Public Health Services Authority, the Controlled Substance Act of 1970 and other federal and foreign statutes and regulations govern and influence the testing, manufacturing, packing, labeling, storing, record keeping, safety, approval, advertising, promotion, sale and distribution of our products. In addition, we and our partners are also subject to ongoing DEA regulatory obligations, including annual registration renewal, security, record keeping, theft and loss reporting, periodic inspection and annual quota allotments for the raw material for commercial production of our products. The failure to comply with these regulations could result in, among other things, warning letters, fines, injunctions, civil penalties, recall or seizure of products, total or partial suspension of production, non-renewal of marketing applications or authorizations or criminalprosecution, which could adversely affect our business, results of operations and financial condition.
We are also required to report adverse events associated with our products to the FDA and other regulatory authorities. Unexpected or serious health or safety concerns could result in labeling changes, recalls, market withdrawals or other regulatory actions. Recalls may be issued at our discretion or at the discretion of the FDA or other empowered regulatory agencies.
We may incur significant liability if it is determined that we are promoting or have in the past promoted the “off-label” use of our products.
Companies may not promote drugs for “off-label” use—that is, uses that are not described in the product’s labeling and that are not consistent with those approved by the FDA. Physicians may prescribe drug products for off-label uses, and such off-label uses are common across some medical specialties. Although the FDA and other regulatory agencies do not regulate a physician’s choice of treatments, the FDCA and FDA regulations restrict communications on the subject of off-label uses of drug products by pharmaceutical companies. The Office of Inspector General of the U.S. Department of Health and Human Services, the FDA, and the DOJ all actively enforce laws and regulations prohibiting promotion of off-label use and the promotion of products for which marketing clearance has not been obtained. If any regulatory agencies open investigations or bring actions against us that result in a finding that we engaged in wrongdoing, including sales and marketing practices for our former, current and/or future products that violate applicable laws and regulations, we would be subject to significant liabilities.
Such liabilities would damage our reputation, divert management’s attention from our business operations, and harm our business, financial condition and results of operations.
Healthcare reform can reduce our revenues, increase our expenses and adversely affect the commercial success of our products.
There have been, and there will continue to be, legislative, regulatory and third-party payor proposals to change the healthcare system in ways that could impact our ability to commercialize our products profitably. We anticipate that the federal and state legislatures and the private sector will continue to consider and may adopt and implement healthcare policies, such as the IRA and ACA, intended to curb rising healthcare costs. These cost-containment measures may include, among other measures: requirements for pharmaceutical companies to negotiate prescription drug prices with government healthcare programs; controls on government-funded reimbursement for drugs; new or increased requirements to pay prescription drug rebates to government healthcare programs, including if drug prices increase at a higher rate than inflation; controls on healthcare providers; challenges to or limits on the pricing of drugs, including pricing controls or limits or prohibitions on reimbursement for specific products through other means; requirements to try less expensive products or generics before a more expensive branded product; and public funding for cost effectiveness research, which may be used by government and private third-party payors to make coverage and payment decisions.
For example, the ACA includes numerous provisions that affect pharmaceutical companies, including provisions intended to expand healthcare coverage to the uninsured through private health insurance reforms and an expansion of Medicaid. The ACA also imposes substantial costs on pharmaceutical manufacturers, such as an increase in liability for rebates paid to Medicaid, new drug discounts that must be offered to certain enrollees in the Medicare prescription drug benefit and an annual fee imposed on all manufacturers of brand prescription drugs in the U.S. The ACA also requires increased disclosure obligations and an expansion of an existing program requiring pharmaceutical discounts to certain types of hospitals and federally subsidized clinics and contains cost-containment measures that could reduce reimbursement levels for pharmaceutical products. The ACA also includes provisions known as the Physician Payments Sunshine Act, which require manufacturers of drugs, biologics, devices and medical supplies covered under Medicare and Medicaid to record any transfers of value to certain U.S. healthcare providers (including, but not limited to, physicians, physician assistants, nurse practitioners, dentists, optometrists, podiatrists, chiropractors and other healthcare providers) and teaching hospitals and to report this data to the CMS annually for subsequent public disclosure. Similar reporting requirements have also been enacted on the state level domestically, and an increasing number of countries worldwide either have adopted or are considering similar laws requiring transparency of interactions with healthcare professionals. Failure to report appropriate data may result in civil or criminalfines and/or penalties.
In addition, the IRA contains provisions intended to lower beneficiary drug spending. The IRA enables Medicare to negotiate prescription drug prices with manufacturers of certain high-cost drugs for the first time. A separate provision requires drug manufacturers to pay rebates to Medicare if their drug prices increase at a higher rate than the rate of inflation (the so-called inflation rebate provision). Additionally, beginning in 2024, the IRA eliminates the 5% coinsurance for catastrophic coverage under Medicare Part D; and in 2025, the IRA capped the beneficiary annual out-of-pocket expenditure and required new mandatory manufacturer discounts. Since its enactment, CMS has taken steps to implement various provisions of the IRA, including negotiating and publishing maximum fair prices for drugs selected under the IRA’s negotiation framework. The ultimate impact of the IRA’s drug pricing provisions on the pharmaceutical industry, including on pricing, reimbursement, and market dynamics, remains uncertain.
Legislative and regulatory efforts to implement drug pricing reforms, including MFN models, can adversely affect our business, if implemented. For example, in May 2025, the President of the United States issued an executive order instructing the executive branch to communicate MFN price targets to pharmaceutical manufacturers, aiming to align prices with those in comparably developed nations. In December 2025, CMS subsequently proposed new mandatory demonstration payment models, including the Global Benchmark for Efficient Drug Pricing (“GLOBE”) for Medicare Part B and Guarding U.S. Medicare Against Rising Drug Costs (“GUARD”) for Medicare Part D under its Center for Medicare and Medicaid Innovation (“CMMI”) authority. If finalized, the GLOBE and GUARD models would impose additional mandatory rebates on manufacturers of certain Medicare Part B and Medicare Part D drugs, for select Medicare populations intended to represent 25% of Medicare patients, if the Medicare prices for such products exceed those paid in economically comparable countries. Both the GLOBE and GUARD models would be tested over a 5-year performance period and would run through 2031, with rebate invoicing and reconciliation continuing into 2033. If these models are finalized as proposed under CMMI authority, we could be required to pay additional rebates on products reimbursed by Medicare for ROLVEDON for the covered populations during the applicable model periods. These proposed reforms create uncertainty for our business, and they remain subject to change through potential legal challenges or subsequent rulemaking or sub-regulatory guidance. While we are unable to predict
whether any pending or future reforms may be adopted, if such reforms are adopted they could lower our pricing, which would have a material negative impact on our competitive position in the market, our sales levels and our profitability.
In addition, while we are not currently engaged in a significant number of clinical trials at this time, if that changes and we are unable to adapt to changes in existing requirements or the adoption of new requirements or policies governing clinical trials, our development plans may be impacted. For example, in December 2022, with the passage of Food and Drug Omnibus Reform Act (“FDORA”), Congress required sponsors to develop and submit a Diversity Action Plan (“DAP”) for each Phase 3 clinical trial or any other “pivotal study” of a new drug or biological product. These plans are meant to encourage the enrollment of more diverse patient populations in late-stage clinical trials of FDA-regulated products. In June 2024, as mandated by FDORA, the FDA issued draft guidance outlining the general requirements for DAPs. Unlike most guidance documents issued by the FDA, the DAP guidance when finalized will have the force of law because FDORA specifically dictates that the form and manner for submission of DAPs are specified in FDA guidance. In January 2025, in response to an Executive Order issued by the President of the United States on Diversity, Equity and Inclusion programs, the FDA removed this draft guidance from its website. This action raises questions about the applicability of statutory obligations to submit DAPs and the agency’s current thinking on best practices for clinical development.
Any new laws or regulations that have the effect of imposing additional costs or regulatory burden on pharmaceutical manufacturers, or otherwise negatively affect the industry, could adversely affect our ability to successfully commercialize our products and any future product candidates. The implementation of any price controls, caps on prescription drugs or price transparency requirements, whether at the federal level or state level, could adversely affect our business, operating results and financial condition.
We are not always able to protect our intellectual property and are subject to risks from liability for infringing the intellectual property of others.
Our success depends in part on our ability to obtain and maintain patent protection for our products and technologies, and to preserve our trade secrets. Our policy is to seek to protect our proprietary rights by, among other methods, filing patent applications in the U.S. and foreign jurisdictions to cover certain aspects of our technology. We hold patents in the U.S. and in foreign countries. In addition, we may pursue patent applications relating to our technologies in the U.S. and abroad. Any such patent applications may lack priority over other applications or may not result in the issuance of patents. Even if issued, our patents may not be sufficiently broad to provide protection against competitors with similar technologies and may be challenged, invalidated or circumvented, which could limit our ability to stop competitors from marketing related products or may not provide us with competitive advantagesagainst competing products. We also rely on trade secrets and proprietary know-how, which are difficult to protect. We seek to protect such information, in part, by entering into confidentiality agreements with employees, consultants, collaborative partners and others before such persons or entities have access to our proprietary trade secrets and know-how. These confidentiality agreements may not be effective in certain cases, due to, among other things, the lack of an adequate remedy for breach of an agreement or a finding that an agreement is unenforceable. In addition, our trade secrets may otherwise become known or be independently developed by competitors.
Our ability to develop our technologies and to make commercial sales of products using our technologies also depends on not infringing other patents or intellectual property rights. We are not aware of any such intellectual property claims directly against us. However, the pharmaceutical industry has experienced extensive litigation regarding patents and other intellectual property rights. Patents issued to third parties in the future could be asserted against us, although we believe that we do not infringe any valid claim of any patents. If claims concerning any of our products were to arise and it was determined that these products infringe a third party’s proprietary rights, we or our commercial partners could be subject to substantial damages for past infringement or could be forced to stop or delay activities with respect to any infringing product, unless we or our commercial partner, as applicable, can obtain a license, or our product may need to be redesigned so that it does not infringe upon such third party’s patent rights, which may not be possible or could require substantial funds or time. Such a license may not be available on acceptable terms, or at all. Even if we, our collaborators or our licensors were able to obtain a license, the rights may be nonexclusive, which could give our competitors access to the same intellectual property. In addition, any public announcements related to litigation or interference proceedings initiated or threatenedagainst us, even if such claims are without merit, could cause our stock price to decline.
Macroeconomic conditions can materially impact our business and operations.
Adverse economic conditions, including inflationary pressures, economic slowdown or recession, relatively high interest rates, government shutdowns, changes to fiscal and monetary policy or government budget dynamics (particularly in the pharmaceutical and biotechnology areas), potential U.S. federal government shutdowns, geopolitical conflicts, financial institution instability and similar events beyond our control can affect our business and financial results. For instance, recent
supply chain constraints have led to higher inflation, which if sustained could have a negative impact on the acquisition of our APIs or the cost to manufacture and purchase our products, as well as our business and results of operations. If inflation or other factors were to significantly increase our business costs or the costs of the manufacturers we use to manufacture our products, our ability to purchase our APIs or our products may be negatively affected. Interest rates, the liquidity of the credit markets and the volatility of the capital markets could also affect the operation of our business and our ability to raise capital on favorable terms, or at all, in order to fund our operations, business development efforts and other business plans. Similarly, these macroeconomic factors could affect the ability of our third-party suppliers to supply our APIs and our manufacturers to manufacture our products cost effectively. For example, in September 2025, the U.S. announced plans to impose up to 100% tariffs on imported branded or patented pharmaceuticals, unless the importing company is building U.S. manufacturing capacity (the “Pharma Tariffs”). Certain major drug producers and manufacturers have negotiated or are in negotiations with the U.S. federal administration to receive relief from such tariffs. While implementation of the Pharma Tariffs is subject to uncertainty, there is a possibility that the Pharma Tariffs could impact the cost at which we purchase the APIs or other components for our products. Current and threatened tariffs are subject to implementation or change with little notice. For example, the U.S. Supreme Court ruled in February 2026 that certain tariffs imposed by the U.S. federal government under the International Emergency Economic Powers Act exceeded presidential authority and therefore are invalid. However, tariffs imposed under different statutes (including the Pharma Tariffs, if implemented) were not directly impacted by the decision and therefore remain in place. The scope and durability of existing and future tariffs remain uncertain, and any potential impact on our business is unclear at this time. Historically, tariffs have led to increased trade and political tensions. In response to tariffs, other countries have implemented retaliatory tariffs on U.S. goods. Political tensions as a result of trade policies could reduce trade volume, investment, technological exchange and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets. New tariffs (including potential tariffs on imported pharmaceuticals into the U.S.) and greater restrictions on trade generally may be imposed. Concerns also remain around the social, political and economic impacts of the changing political landscape in Europe and elsewhere. Broader geopolitical tensions remain high among the U.S. Russia, China and across the Middle East. Given the international scope of our supply chain, any of the above factors, including sanctions, export controls, tariffs, trade wars and other governmental actions, can have a material adverse effect on our business, financial condition, cash flows and results of operations and can cause the market value of our common shares and/or debt securities to decline.
Risks Related to Our Business Development Activities
Our success is dependent on our ability to successfully execute business development strategies, strategic partnerships, acquisitions of businesses, product candidates, products, or technologies, and investment opportunities to build and grow for the future. Our failure or inability to do so will limit our business growth and prospects.
Over the past several years, we have actively pursued and executed several opportunistic business development and strategic transactions designed to grow our revenues and profits and improve our balance sheet, with varying levels of success. Successfully identifying and executing on such business development and strategic transactions is not easily achievable and depends on several factors, including, but not limited to, the availability and willingness of other parties to transact on terms we find attractive and our ability to fund such transactions from our existing cash flows or raise funds from third parties. If we are unable to find attractiveopportunities, finance them and successfully execute and integrate such acquisitions, our business growth and prospects will be adversely impacted.
Our ability to fund our business development strategies may be limited by the financial resources we are able to obtain, which may restrict our ability to pursue, fund and complete acquisitions or other strategic transactions. We may be unable to finance potential transactions from existing cash flows, and there can be no assurance that we will be able to raise necessary third-party financing on acceptable terms or at all. As a result, we may forgo or be unable to complete attractive business development opportunities, or we may be required to accept less favorable terms, thereby limiting our ability to enhance or expand our product portfolio. This would further adversely impact our business growth and prospects.
An important element of our business strategy is to actively seek to acquire product candidates, products, technologies or companies and to in-license or seek co-promotion rights to additional products. In the past, we have acquired ROLVEDON, Otrexup, Sympazan, CAMBIA, the INDOCIN products, SPRIX, NUCYNTA and NUCYNTA ER (both NUCYNTA products were subsequently divested to Collegium in February 2020 and we ceased commercializing Otrexup in July 2025). We cannot be certain that we will be able to successfully identify, pursue, finance and complete any future acquisitions or whether we would be able to successfully obtain regulatory approvals and launch, if applicable, integrate or develop any acquired business, product candidate, product or technology, successfully commercialize and realize the anticipated benefits from acquired products or retain any key employees. If we are unable to enhance and broaden our product offerings, our business and prospects will be limited.
In addition, if our executive management team is not able to develop, implement and execute successful business development strategies and plans to maintain and increase our product revenues in a timely manner, our business, financial condition and results of operations will be materially and adversely affected, and the existing business may be required to take further steps to reduce its costs at some point in time. It may take time for our executive management team, despite their significant industry-related experience, to develop, implement and execute our business strategies and plans.
Further, our future business strategies and plans may differ materially, or may continue to evolve, from those we previously pursued. If our business strategies and plans, or our efforts to realize future operational efficiencies, cause disruption in our business or operations or do not achieve the level of success or results we anticipate, our business, financial condition and results of operations will be materially and adversely affected.
Strategic transactions that fail to achieve the anticipated levels of revenue, synergies and profit growth will cause our business to suffer.
We seek to engage in strategic transactions with third parties, such as product acquisitions, strategic partnerships, joint ventures, business combinations or divestitures. We face significant competition in seeking potential strategic partners and transactions, and the negotiation process for acquiring any product or engaging in strategic transactions can be time-consuming and complex. Engaging in strategic transactions, such as acquisitions of product rights, businesses combinations and divestitures, and commercialization arrangements, have in the past and may in the future require us to incur non-recurring and other charges, increase our near- and long-term expenditures, pose integration challenges and fail to achieve the anticipated results or synergies or distract our management and business, which may harm our business.
As part of an effort to acquire a product candidate, product or company or to enter into other strategic transactions, we conduct due diligence with the goal of identifying, evaluating and assessing material risks involved in the transaction. However, it is not possible to ascertain, evaluate and accurately assess all potential risks, which may impact our ability to realize the intended advantages of the transaction. We also assume liabilities and legal risks in connection with a transaction, including those relating to activities of the seller prior to the consummation of the transaction and contracts that we assume. Failure to realize the expected benefits from acquisitions or strategic transactions that we may consummate, or that we have completed, such as those described above, whether as a result of identified or unidentified risks, integration difficulties, regulatory setbacks, governmental investigations, independent actions of or financial position of our collaborative partners, litigation or other events, could adversely affect our business, results of operations and financial condition.
These factors, many of which are beyond our control, could delay or prevent the achievement of our business objectives and cause our business, financial condition and results of operations to be materially and adversely affected.
Failure to integrate any business, product or technology we acquire, will cause our business, financial condition and operating results to suffer.
Integrating any business, product or technology we acquire is expensive and time-consuming and can disrupt and adversely affect our ongoing business, including product sales, and distract our management. Our ability to successfully integrate any business, product or technology we acquire depends on a number of factors, including, but not limited to, our ability to:
• maintain existing agreements with customers, suppliers, distributors and vendors, avoid delays in entering into new agreements with prospective customers, suppliers, distributors and vendors, and leverage relationships with such third parties;
• obtain and maintain adequate coverage, reimbursement and pricing from managed care, government and other third-party payors with respect to any acquired product;
• maintain and increase sales of our existing products;
• establish or manage the transition of the manufacture and supply of any acquired product, including the necessary active pharmaceutical ingredients, excipients and components;
• integrate and unify the offerings and services available to customers;
• integrate the owned and licensed technologies from third parties;
• integrate personnel from the acquired business;
• combine our and the acquired business’ operations and corporate functions, if any;
• address possible differences in business backgrounds, corporate cultures and management philosophies, if any;
• meet the capital requirements of the acquired business in a manner that permits us to achieve any cost savings or other synergies anticipated to result from the acquisition;
• identify and add the necessary sales, marketing, manufacturing, regulatory and other related personnel, capabilities and infrastructure that are required to successfully integrate any acquired business, product or technology;
• minimize the disruption and distraction of our management and other employees in connection with the integration of any acquired business, product or technology;
• harmonize our and the acquired business’ operating practices, compensation programs, internal controls and other policies, processes and procedures;
• manage the transition and migration of all commercial, financial, legal, clinical, regulatory and other pertinent information relating to any acquired business, product or technology;
• identify and eliminate redundant and underperforming functions and assets;
• comply with legal, regulatory and contractual requirements applicable to any acquired business, product or technology; and
• maintain and extend intellectual property protection for any acquired product or technology.
If we are unable to perform the above functions or otherwise effectively integrate any acquired businesses, products or technologies, our business, financial condition and operating results will suffer.
Risks Related to Our Financial Position
Our existing capital resources may not be sufficient to fund our future operations or product acquisitions and strategic transactions that we may pursue.
We fund our operations primarily through our existing capital resources and operating cash flows and do not have any committed sources of capital. To the extent that our existing capital resources and operating cash flows are insufficient to fund our future operations, including our litigation-related costs, product acquisitions and strategic transactions that we may pursue, we will have to seek to raise additional funds through the sale of our equity securities, through additional debt financing, from development and licensing arrangements and/or from the sale of assets. We may be unable to raise such additional capital on a timely basis and on favorable terms, or at all. If we raise additional capital by selling our equity or convertible debt securities, the issuance of such securities could result in dilution of our shareholders’ equity positions.
Our failure to generate sufficient cash flow from our business to make payments on our debt would adversely affect our business, financial condition and results of operations. Our indebtedness could limit our ability to incur additional debt to fund our operations.
We have $40 million aggregate principal amount outstanding under our 6.5% Convertible Senior Notes, which mature on September 1, 2027, with interest payable semi-annually in arrears on March 1 and September 1 of each year (the “2027 Convertible Notes”). Holders of the 2027 Convertible Notes will have the right to require us to repurchase their 2027 Convertible Notes for cash upon the occurrence of a “fundamental change,” as defined in the indenture for the 2027 Convertible Notes, and we may elect to settle all or a portion of the conversion obligation of the 2027 Convertible Notes in cash. Our ability to make scheduled payments of the principal of, to pay interest on, to offer to repurchase the 2027 Convertible Notes upon a fundamental change as defined in the indenture for the 2027 Convertible Notes, or to refinance the 2027 Convertible Notes and any additional debt obligations we may incur depends on our future performance, which is subject to economic, financial, competitive and other factors that may be beyond our control. If we are unable to generate the necessary cash flow, we may be required to adopt one or more alternatives, such as selling assets, restructuring debt or obtaining additional equity capital on terms that may be onerous or highly dilutive. Any failure to generate sufficient cash flow to satisfy our obligations under the 2027 Convertible Notes or any future indebtedness could lead to a default under the 2027 Convertible Notes or such indebtedness.
The indenture for the 2027 Convertible Notes contains covenants limiting our ability in the future to secure our or our subsidiaries’ assets or have our subsidiaries issue guarantees without equally and ratably securing or guaranteeing the 2027 Convertible Notes. These covenants may make it more difficult for us to incur indebtedness to fund our operations on attractive terms or at all.
We may seek to refinance all or a portion of our outstanding indebtedness in the future. Any such refinancing would depend on the capital markets and business and financial conditions at the time, which could affect our ability to obtain attractive terms if or when desired or at all.
In addition, our significant indebtedness, combined with our other financial obligations and contractual commitments, could have other important consequences to our business. For example, it could:
• limit our ability to borrow additional amounts for working capital and other general corporate purposes, including funding possible acquisitions of, or investments in, new and complementary businesses, products and technologies, which is a key element of our corporate strategy;
• make it more difficult for us to meet our payment and other obligations under our indebtedness;
• require the dedication of a substantial portion of our cash flow from operations to service our indebtedness, thereby reducing the amount of our cash flow available for other purposes, including working capital, business development activities, any future clinical trials and/or research and development, capital expenditures and other general corporate purposes;
• result in other events of default under our indebtedness, which events of default could result in all our debt becoming immediately due and payable;
• make us more vulnerable to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation;
• limit our flexibility in planning for, or reacting to, changes in our business and our industry; and
• put us at a disadvantage compared to our competitors who have less debt.
Any of these factors can adversely affect our business, financial condition and results of operations. In addition, if we incur additional indebtedness, the risks related to our business and our ability to service or repay our indebtedness would increase.
We have incurred operating losses in the past and may incur operating losses in the future.
We have incurred net losses in many of the years of our existence, including in the past three years. We may incur operating losses in future years. Any such losses may have an adverse impact on our total assets, shareholders’ equity and working capital.
We have significant amounts of long-lived assets which depend upon future positive cash flows to support the value recorded in our balance sheet. We have recognized impairment charges in the past and may recognize impairment charges in the future should actual financial results differ materially from our projections.
Our consolidated balance sheet contains significant amounts of long-lived assets, including intangible assets representing the product rights which we have acquired, which have a total net carrying value of $48.9 million as of December 31, 2025. The net carrying amount of our product rights intangible assets related to ROLVEDON and Sympazan are $34.7 million and $10.7 million, respectively, as of December 31, 2025. We review the carrying value of our long-lived assets when indicators of impairment are present. Conditions that could indicate impairment of long-lived assets include, but are not limited to, our market capitalization declining below the book value of our equity, a significant adverse change in market conditions, significant competing product launches by our competitors, a significant adverse change in the manner in which the long-lived asset is being used, and adverse legal or regulatory outcomes.
During each quarter of 2025 and 2024, our market capitalization was below the book value of our equity, which management determined represented an indicator of impairment with respect to our long-lived assets. For the three months ended September 30, 2025, we also recognized an additional indicator of impairment in our SPRIX asset group related to a change in the expected timing of cash flows from SPRIX net product sales. Applying the relevant accounting guidance, we first assessed the recoverability of our long-lived assets at the product level at each date.
For the assessment performed for the three months ended September 30, 2025, we determined that the undiscounted cash flows and the fair value of the SPRIX asset group were less than its carrying value and recognized an impairment for this asset group of $1.7 million during the third quarter of 2025, reducing its carrying value to $4.6 million.
For the assessment performed for the three months ended December 31, 2024, we determined that the estimated undiscounted cash flows and fair value of the Otrexup asset group were less than its carrying value and recognized an impairment for this asset group of $5.2 million during the fourth quarter of 2024, reducing its carrying value to zero.
For all the assessments for our other asset groups performed during each quarter in 2025 and 2024, we determined that the estimated undiscounted cash flows were in excess of the carrying amounts for all our long-lived asset groups at each impairment testing date. Accordingly, we concluded that the long-lived asset groups were fully recoverable and no adjustment to their carrying values was required.
In performing our impairment tests, which assess the recoverability of our assets, we utilize our future projections of cash flows. Projections of future cash flows are inherently subjective and reflect assumptions that may or may not ultimately be realized. Significant assumptions utilized in our projections include, but are not limited to, our evaluation of the market opportunity for our products, the current and future competitive landscape and resulting impacts to product pricing, future regulatory actions, planned strategic initiatives and the realization of benefits associated with our existing patents. Given the inherent subjectivity and uncertainty in projections, we could experience significant unfavorable variances in future periods or revise our projections downward. This would result in an increased risk that our long-lived assets may be impaired. Any future impairments could have a material adverse effect on our financial condition and results of operations.
We have significant amounts of inventory, and we have recognized inventory write-off charges in the past and may recognize write-off charges in the future.
Inventories are stated at the lower of cost or net realizable value, with cost determined by specific manufactured lot. Inventories consist of costs of the active pharmaceutical ingredient, contract manufacturing and packaging costs. We review for potentially excess, dated or obsolete inventories based on an analysis of inventory on hand and projected demand, as well as inventory that may not be salable because it does not meet our quality standards. We write down the value of potentially excess, dated or obsolete inventory, or inventory with quality issues impacting its salability, when evidence of these conditions exist. For the years ended December 31, 2025 and 2024, we recognized $4.5 million and $9.0 million of inventory write-downs, respectively. We may recognize inventory write-downs in the future based on changes in projected demand, continuing quality issues and/or other factors that we are not yet aware, any of which could have an adverse effect on our financial condition, results of operations or cash flows.
Our financial results are impacted by management’s assumptions and use of estimates.
The preparation of financial statements in conformity with generally accepted accounting principles in the U.S. requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Estimates are used in determining items such as product returns, rebates, evaluation of impairment of intangible assets, amounts recorded in connection with acquisitions and taxes on income. Although management believes these estimates are based upon reasonable assumptions within the bounds of its knowledge of our business and operations, actual results could differ materially from these estimates. For additional information, please refer to the Critical Accounting Policies and Significant Estimates section within “ Item 7 . Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
We face risks relating to product liability losses and other litigation liability for which we may be unable to maintain or obtain adequate insurance.
We are, or may be, involved in various legal proceedings, lawsuits and certain government inquiries and investigations, including with respect to, but not limited to, securities class action lawsuits, Medicare and Medicaid reimbursement claims, patent infringement, product liability, personal injury, antitrust matters, breach of contract, promotional practices and compliance with laws relating to the manufacture and sale of controlled substances. For example, we are subject to shareholder litigation relating to the Spectrum Merger and/or the approval and launch of generic indomethacin suppositories in the second half of 2023, and Spectrum is named in several securities class action and shareholder derivative lawsuits filed by former Spectrum stockholders. Such litigation and related matters are described in “Item 8. Financial Statements and Supplementary Data – Note 8 . Commitments and Contingencies.”
The defense of these legal proceedings, inquiries, and investigations have resulted in, and are expected to continue to result in, us incurring significant expenses and may adversely impact our ability to execute product acquisitions and strategic transactions using our common stock, obtain financing or refinance existing debt, or could make us less attractive to potential acquirers. In addition, other than with respect to shareholder litigation, we do not presently anticipate receiving any insurance coverage for any of our pending litigation. With respect to shareholder litigation, we have provided notice to our insurance carriers with respect to such litigation, and we have received, and further anticipate receiving, some amount of insurance coverage with respect to such litigation. There is, however, no guarantee that our shareholder litigation insurance coverage will adequately protect us from our pending or future shareholder litigationclaims. If any of these legal proceedings, inquiries or
investigations were to result in an adverse outcome, the impact could have an adverse effect on our competitive position, business, financial condition, results of operations and cash flows.
We have obtained product liability insurance for sales of our products and any clinical trials currently underway, but:
• we may be unable to maintain product liability insurance on acceptable terms;
• we may be unable to obtain product liability insurance for future trials;
• we may be unable to obtain product liability insurance for future products; or
• our insurance may not provide adequate protection against potential liabilities or may provide no protection at all.
Our inability to obtain or maintain adequate insurance coverage at an acceptable cost could prevent or inhibit the commercialization of our products. Defending a lawsuit could be costly and significantly divert management’s attention from conducting our business. If third parties were to bring a successful product liability or other claims, or series of claims, against us for uninsured liabilities, or in excess of our insured liability limits, our business, results of operations and financial condition could be adversely affected.
Our ability to use NOLs to offset future taxable income may be limited.
We have recognized NOLs for losses we incurred during our history. As of December 31, 2025, we have U.S. federal NOLs of $256.1 million that expire between 2029 and 2037 and state NOL carryforwards of $554.6 million, which begin to expire in 2026. Additionally, we have U.S. federal NOLs generated in taxable years beginning after December 31, 2017 of $690.5 million that under current U.S. federal income tax law can be carried forward indefinitely, but the deductibility of such U.S. federal NOLs in taxable years beginning after December 31, 2020 is limited to 80% of our taxable income. State NOL carryforward periods, expirations and limitations may differ from federal tax laws.
Accordingly, our pre-2018 NOL carryforwards may expire prior to being used, our NOL carryforwards generated in 2018 and thereafter will be subject to a percentage limitation and our ability to use pre-2018 NOL carryforwards and other 2018 tax attributes (such as research tax credits) to offset income or cash taxes may be limited. Similar provisions of state tax law may also apply to limit our use of accumulated state NOLs. In addition, at the state level, there may be periods during which the use of NOLs is suspended or otherwise limited, which could increase state taxes owed. Utilization of our NOLs are subject to a substantial annual limitation due to ownership change limitations provided by the Internal Revenue Code of 1986 and similar state provisions. The annual limitation may result in the expiration of net operating losses before utilization. We currently have a full valuation allowance established against our NOLs and tax credit carryforwards, primarily due to our recurring net operating losses. As a result, even if we regainprofitability, we may be unable to use all or a material portion of our NOLs and other tax attributes, which could adversely affect future cash flows.
Risks Related to Future Product Development
The development of drug and biological product candidates is inherently difficult and uncertain, and we cannot be certain that any of our future product candidates will be approved for marketing or, if approved, will achieve market acceptance. Failure to obtain regulatory approval for our products, our raw materials or future product candidates, will limit our ability to commercialize our products, and our business will suffer.
Other than our ongoing post-marketing pediatric Phase 4 clinical study of ROLVEDON, we are currently not engaged in any material clinical or preclinical trials, but may be in the future. Clinical development is a long, expensive and uncertain process and is subject to delays and failures. As a condition to regulatory approval, each future product candidate must undergo extensive and expensive preclinical studies and clinical trials to demonstrate to a statistically significant degree that any such product candidate is safe and effective. The results at any stage of the development process may lack the desired safety, efficacy or pharmacokinetic characteristics. Positive or encouraging results of prior clinical trials are not necessarily indicative of the results obtained in later clinical trials, and later clinical trials may fail to show the desired safety and efficacy despite having progressed in development. In addition, data obtained from pivotal clinical trials are susceptible to varying interpretations, which could delay, limit or prevent regulatory approval.
Product candidates are subject to the risk that any or all of them may be found to be ineffective or unsafe, or otherwise may fail to receive necessary regulatory clearances. The FDA or other applicable regulatory agencies may determine that our data is not sufficiently compelling to warrant marketing approval and require us to engage in additional clinical trials or provide further analysis, which may be costly and time-consuming. A number of companies in the pharmaceutical and biological
product industry have suffered significant setbacks in clinical trials, even in later clinical trials after showing positive results in preclinical studies or earlier clinical trials. If our future product candidates fail at any stage of development, they will not receive regulatory approval, we will not be able to commercialize them and we will not receive any return on our investment in any such product candidates. We may also have asset impairments, other asset write-offs, or additional liabilities as a result of the failure of any of our future product candidates, which would impact our results from operations and financial position.
Other factors could delay or result in the termination of our future clinical trials and related development programs, including:
• negative or inconclusive results;
• patient enrollment requirements and rates;
• patient noncompliance with the clinical trial protocol;
• adverse medical events or side effects among patients during the clinical trials;
• any findings resulting from FDA inspections of clinical operations;
• failure to meet FDA preferred or recommended clinical trial design, end points or statistical power;
• failure to comply with current good clinical practices;
• our failure, and the failure of third-party clinical trial vendors to comply with applicable regulatory laws and regulations;
• inability of third-party clinical trial vendors to satisfactorily perform their contractual obligations, comply with applicable laws and regulations or meet deadlines;
• delays or failures in obtaining clinical materials or manufacturing sufficient quantities of the product candidate for use in clinical trials; and
• unexpected external medical threats such as epidemics, pandemics, or other disease outbreaks.
We are unable to predict whether any future product candidates will receive regulatory clearances or be successfully manufactured or marketed. Further, due to the extended testing and regulatory review process required before marketing clearance can be obtained, the time frame for commercializing a product is long and uncertain. Additionally, disruptions at the FDA and other regulatory agencies, including as a result of reductions in budget, personnel, or operations, may cause delays in the review and/or approval of our product candidates. Even if product candidates receive regulatory clearance, these products may not achieve or maintain market acceptance. If it is discovered that our products or technologies have potential adverse effects or other characteristics that indicate they may be ineffective as therapeutics, our product development efforts and our business could be significantly harmed.
Even assuming our products obtain regulatory approval, successful commercialization requires:
• market acceptance;
• a cost-effective commercial-scale production; and
• reimbursement under private or governmental health plans.
Any material delay or failure in the governmental approval process, the successful production of commercial product or the successful commercialization of any future approved product candidates could adversely impact our business, financial condition and results of operations.
The regulatory process is expensive and time consuming. Even after investing significant time and expenditures on clinical trials, we may not obtain regulatory approval of any future product candidates. Data obtained from clinical trials are susceptible to varying interpretations, which could delay, limit or prevent regulatory approval, and the FDA may not agree with our methods of clinical data analysis or our conclusions regarding safety and/or efficacy. Significant clinical trial delays could impair our ability to commercialize any future products and could allow our competitors to bring products to market before we do. In addition, changes in regulatory policy for product approval during the period of product development and regulatory agency review of each submitted new application may cause delays or rejections. Even if we receive regulatory approval, this approval may entail limitations on the indicated uses for which we can market a product.
We and our collaborative partners customarily depend on third-party contract research organizations, clinical investigators and clinical sites to conduct clinical trials with regard to product candidates, and if they do not perform their regulatory, legal and contractual obligations, or successfully enroll patients in and manage our clinical trials, we and our collaborative partners may not be able to obtain regulatory approvals for future product candidates.
We and our collaborative partners customarily depend on third-party contract research organizations and other third parties to assist us in designing, managing, monitoring and otherwise conducting clinical trials. We and our collaborative partners do not directly control these third parties and, as a result, we and our collaborative partners may be unable to control the amount and timing of resources that they devote to our or our collaborative partners’ clinical trials.
Although we and our collaborative partners rely on third parties to conduct clinical trials, we and our collaborative partners are responsible for confirming that each clinical trial is conducted in accordance with its general investigational plan and protocol, as well as the FDA’s and other applicable regulatory agencies’ requirements, including good clinical practices, for conducting, recording and reporting the results of clinical trials to ensure that the data and results are credible and accurate and that the trial participants are adequately protected. If we, contract research organizations or other third parties assisting us or our collaborative partners with clinical trials fail to comply with applicable good clinical practices, the clinical data generated in such clinical trials may be deemed unreliable and the FDA, or other applicable regulatory agencies, may require us or our collaborative partners to perform additional clinical trials before approving any marketing applications with regard to future product candidates. We cannot be certain that, upon inspection, the FDA or other applicable regulatory agencies will determine that any of our clinical trials or those of our collaborative partners comply with good clinical practices. In addition, clinical trials must be conducted with product produced under the FDA’s cGMP regulations and similar regulations outside of the U.S. Our or our collaborative partners’ failure, or the failure of our product manufacturers, to comply with these regulations may require the repeat or redesign of clinical trials, which would delay the regulatory approval process.
We and our collaborative partners also customarily rely on clinical investigators and clinical sites to enroll patients and other third parties to manage clinical trials and to perform related data collection and analysis. If clinical investigators and clinical sites fail to enroll a sufficient number of patients in such clinical trials or fail to enroll them on the planned schedule, these trials may not be completed or completed as planned, which could delay or prevent us or our collaborative partners from obtaining regulatory approvals for future product candidates.
Agreements with clinical investigators and clinical sites for clinical testing and for trial management services place substantial responsibilities on these parties, which could result in delays in, or termination of, clinical trials if these parties fail to perform as expected. If these clinical investigators, clinical sites or other third parties do not carry out their contractual duties or obligations or fail to meet expected deadlines, or if the quality or accuracy of the clinical data they obtain is compromised due to their failure to adhere to clinical protocols or for other reasons, clinical trials may be extended, delayed or terminated, and we and our collaborative partners may be unable to obtain regulatory approval for, or successfully commercialize, product candidates. In addition, clinical trials sometimes need to be amended once the trial is in process in order to ensure enrollment and/or successfulprosecution of a trial, and such amendments could introduce significant delays and/or additional costs to our or our collaborative partners’ clinical programs.
We are subject to risks associated with NDAs we submit under Section 505(b)(2) of the FDCA.
The products we and our collaborative partners develop or acquire generally are or will be submitted for approval under Section 505(b)(2) of the FDCA, which was enacted as part of the Drug Price Competition and Patent Term Restoration Act of 1984, otherwise known as the Hatch-Waxman Act. Section 505(b)(2) permits the submission of an NDA where at least some of the information required for approval comes from studies not conducted by or for the applicant and for which the applicant has not obtained a right of reference. For example, the NDA for CAMBIA relies on the FDA’s previous findings of safety and efficacy of Cataflam, the diclofenac initially approved by the FDA.
For NDAs submitted under Section 505(b)(2) of the FDCA, the patent certification and related provisions of the Hatch-Waxman Act apply. In accordance with the Hatch-Waxman Act, such NDAs may be required to include certifications, known as “Paragraph IV certifications,” that certify any patents listed in the Orange Book publication in respect to any product referenced in the 505(b)(2) application are invalid, unenforceable and/or will not be infringed by the manufacture, use or sale of the product that is the subject of the 505(b)(2) application. Under the Hatch-Waxman Act, the holder of the NDA which the 505(b)(2) application references may file a patent infringement lawsuit after receiving notice of the Paragraph IV certification. Filing of a patent infringement lawsuit triggers a one-time automatic 30-month stay of the FDA’s ability to approve the 505(b)(2) application. Accordingly, we may invest a significant amount of time and expense in the development of one or more products only to be subject to significant delay and patent litigation before such products may be commercialized, if at all. A
Section 505(b)(2) application may also not be approved until any non-patent exclusivity, such as exclusivity for obtaining approval of a new chemical entity, listed in the Orange Book for the referenced product has expired.
The FDA may also require us to perform one or more additional clinical studies or measurements to support the change from the approved product. The FDA may then approve the new formulation for all or only some of the indications sought by us. If the FDA disagrees with the use of the Section 505(b)(2) regulatory pathway for future product candidates, we would need to reconsider our plans and might not be able to obtain approval for any such product candidates in a timely or cost-efficient manner, or at all. The FDA may also reject our future Section 505(b)(2) submissions and may require us to file such submissions under Section 501(b)(1) of the FDCA, which could be considerably more expensive and time-consuming.
Risks Related to Share Ownership
Our common stock may be delisted from The Nasdaq Capital Market if we are unable to maintain compliance with its continued listing standards.
Our common stock is listed on The Nasdaq Capital Market (“Nasdaq”). There are a number of continued listing requirements that we must satisfy in order to maintain our listing on Nasdaq, including the requirement to maintain a minimum bid price of at least $1.00 (the “Bid Price Rule”). If a deficiency with respect to this requirement continues for a period of 30 consecutive business days, Nasdaq may require us to satisfy a minimum bid price per share of our common stock of at least $1.00 for a period in excess of ten consecutive business days, but generally no more than 20 consecutive business days, before determining that we have demonstrated an ability to maintain long-term compliance with the Bid Price Rule. We have been unable to comply with the Bid Price Rule in the past and for periods in 2021 and 2025 our continued listing on Nasdaq required the granting of a grace period from Nasdaq and the implementation of reverse stock splits. If we fail to comply with the Bid Price Rule in the future, there can be no assurance that we will be granted such grace periods or that we will be able to receive the necessary shareholder approval to implement an additional reverse stock split. In particular, we may encounter difficulties obtaining such shareholder approval due to our heavily retail investor shareholder base, which may also affect our ability to obtain shareholder approval of other significant corporate actions.
Any delisting of our common stock would likely adversely affect the market liquidity and market price of our common stock and our ability to obtain financing for the continuation of our operations and/or result in the loss of confidence by investors. If we were delisted from Nasdaq, it would constitute a “fundamental change” under the 2027 Convertible Notes, which would require us to offer to repurchase the 2027 Convertible Notes and would allow the holders of the 2027 Convertible Notes to convert their 2027 Convertible Notes into our common stock at an increased conversion rate, which would make conversion of the 2027 Convertible Notes more dilutive.
The market price of our common stock historically has been volatile. Our results of operations have and may continue to fluctuate and affect our stock price.
The trading price of our common stock has been, and is likely to continue to be, volatile and could be subject to wide fluctuations in response to various factors, some of which are beyond our control. Factors affecting our operating results and that could adversely affect our stock price include the other risk factors noted in this Item 1A.
As a result of these and other such factors, our stock price may continue to be volatile and investors may be unable to sell their shares at a price equal to, or above, the price paid. Any significant drops in our stock price, including those we experienced in 2024 and 2025, have and could g ive rise to shareholder lawsuits, which are costly and time-consuming to defendagainst and which may adversely affect our ability to raise capital while the suits are pending, even if the suits are ultimately resolved in our favor.
In addition, if the market for pharmaceutical stocks or the stock market in general experiences uneven investor confidence, the market price of our common stock could decline for reasons unrelated to our business, operating results or financial condition. For example, if one or more securities or industry analysts downgrades our stock or publishes an inaccurate research report about our company, the market price for our common stock would likely decline. The market price of our common stock might also decline in reaction to events that affect other companies within, or outside, our industry even if these events do not directly affect us.
Fluctuations in the market price of our common stock may also impact the trading price of the 2027 Convertible Notes, and investors may be unable to sell their notes at a price equal to or above the price paid thereof.
Our business could be impacted as a result of actions by activist shareholders, including as a result of a potential proxy contest for the election of directors at future annual meetings.
In the past, activist investors have subjected us to vote-no campaigns and threatened proxy contests in connection with its annual stockholder meeting. These actions by activist investors have resulted in significant legal and other fees being incurred by us, including as a result of litigation arising out of activist shareholders’ activities. The potential for additional proxy contests, vote-no campaigns or other continuing actions by activist investors could result in further costly and time-consuming litigation, interfere with our ability to execute our strategic plan, give rise to perceived uncertainties as to our future direction, adversely affect our relationships with customers, suppliers, investors, prospective and current team members and others, result in the loss of potential business opportunities, or make it more difficult to attract and retain qualified personnel, any of which could materially and adversely affect our business and operating results.
We are subject to risks related to unsolicited takeover attempts in the future.
We have in the past and may in the future be subject to unsolicited attempts to gain control of our company. Responding to any such attempt would distract management attention away from our business and would require us to incur significant costs. Moreover, any unsolicited takeover attempt may disrupt our business by causing uncertainty among current and potential employees, producers, suppliers, customers and other constituencies important to our success, which could negatively impact our financial results and business initiatives. Other disruptions to our business include potential volatility in our stock price and potential adverse impacts on the timing of, and our ability to consummate, acquisitions of products and companies.
Conversions of the 2027 Convertible Notes or future sales of our common stock or equity-linked securities in the public market could lower the market price of our common stock and adversely impact the trading price of the 2027 Convertible Notes.
In 2022, we issued the 2027 Convertible Notes, and in the future, we may sell additional shares of our common stock or equity-linked securities to raise capital. A substantial number of shares of our common stock is reserved for issuance upon the exercise of restricted stock units and stock options, and upon conversion of the 2027 Convertible Notes. We cannot predict the effect, if any, that conversions of the 2027 Convertible Notes or of any future issuances of common stock or equity-linked securities, may have on the market price of our common stock. The issuance and sale or conversion of substantial amounts of common stock or equity-linked securities, or the perception that such issuances and sales may occur, could adversely affect the trading price of the 2027 Convertible Notes and the market price of our common stock and impair our ability to raise capital through the sale of additional equity or equity-linked securities.
Risks Related to our Corporate Organization and General Business Risks
Our success is dependent in large part upon the continued services of our executive management team.
Our success is dependent in large part upon the continued services of members of our executive management team, and on our ability to attract and retain key management and operating personnel. Management, scientific and operating personnel are in high demand in our industry and are often subject to competing offers. Changes in our management team may disrupt our business, strategic and employee relationships, which may delay or prevent the achievement of our business objectives, strategies and plans. During such transition periods, there may be uncertainty among investors, employees and others concerning our future direction and performanc e. For example, Brendan P. O’Grady separated from his service as our Chief Executive Officer (“CEO”) effective as of October 27, 2025 and resigned from his position on our Board of Directors effective November 17, 2025. Effective October 27, 2025, Mark Reisenauer, an existing member of our board of directors, was appointed to serve as our CEO. Effective November 3, 2025, our board of directors appointed Paul Schwichtenberg, the Company’s Chief Transformation Officer, to serve as our President and Chief Operating Officer. As with any significant leadership change, these transitions involve inherent risks and any failure to execute a smooth transition could hinder employee retention and recruitment and our strategic planning, business execution, and future performance, which could have an adverse effect on our business, financial condition and results of operations. We cannot provide assurances that any current or future changes of management personnel will not cause disruption to operations or customer relationships, a decline in our operating results or a delay in the execution of our business strategies and plans. The loss of the services of one or more members of management or key employees or the inability to hire additional personnel as needed could result in delays in the research, development and commercialization of our products and potential product candidates, or otherwise adversely impact our business.
Despite our corporate structure, creditors of our current or former operating subsidiaries could be successful in piercing the corporate veil otherwise reaching the assets of one another, which could have an adverse effect on us and our operating results, results from continued operations, and financial condition.
Our operating subsidiaries are separate legal entities within our holding company corporate structure. There can be no assurance that our efforts to preclude corporate veil-piercing, alter ego, control person, or other similar claims by creditors of any one particular current or former entity within our corporate structure (including Assertio Therapeutics, which was sold in May 2025 to an independent company that is not affiliated with us) from reaching the assets of the other entities, including Assertio Holdings, within our corporate structure to satisfyclaims will be successful. If a court were to allow a creditor to pierce the corporate veil and reach the assets of such other entities within our corporate structure, despite such entities not being directly liable for the underlying claims, it could have a material adverse effect on us and our operating results, results from continued operations, and financial condition.
If we are unable to satisfy regulatory requirements relating to internal controls, our stock price could suffer.
Section 404 of the Sarbanes-Oxley Act of 2002 requires companies to conduct a comprehensive evaluation of the effectiveness of their internal control over financial reporting. At the end of each fiscal year, we must perform an evaluation of our internal control over financial reporting, include in our annual report the results of the evaluation and have our external auditors also publicly attest to the effectiveness of our internal control over financial reporting.
Our ability to produce accurate financial statements and comply with applicable laws, rules and regulations is largely dependent on our maintenance of internal control and reporting systems, as well as on our ability to attract and retain qualified management and accounting personnel to further develop our accounting function and internal control policies. If we fail to effectively establish and maintain such reporting and accounting systems or fail to attract and retain personnel who are capable of designing and operating such systems, these failures will increase the likelihood that we may be required to restate our financial results to correct errors or that we will become subject to legal and regulatory infractions, which may entail civil litigation and investigations by regulatory agencies including the SEC. In addition, if material weaknesses are found in our internal controls in the future, if we fail to complete future evaluations on time or if our external auditors cannot attest to the effectiveness of our internal control over financial reporting, we could fail to meet our regulatory reporting requirements and be subject to regulatory scrutiny and a loss of public confidence in our internal controls, which could have an adverse effect on our stock price or expose us to litigation or regulatory proceedings, which may be costly or divert management attention.
Business interruptions due to natural disasters and other emergencies could severelydisrupt our operations, and have a material adverse effect on our business, results of operations, financial condition and prospects.
Our operations and infrastructure, and those of our partners, third-party suppliers, manufacturers and vendors are vulnerable to damage or interruption from natural disasters or other crises. Our business and operations can be seriouslyinterrupted by natural disasters, fire, flood, the effects of climate change, actual or threatened public health crises, power loss, telecommunications failures, equipment failures, intentional acts of theft, vandalism, terrorism, epidemics, pandemics and other disease outbreak and other public health crises. Our back-up operations and our business interruption insurance as part of our formal disaster recovery plan may not be adequate to compensate us for losses that occur. A significant business interruption could result in losses or damages incurred by us and require us to cease or curtail our operations.
Data breaches and cyber-attacks or other failures in our telecommunications or information technology systems, or those of our third-party vendors or other contractors or consultants, could result in information theft, data corruption and significant disruption of our business operations.
Securities breaches can adversely impact our operations and financial results. In the ordinary course of our business, we collect, maintain and transmit sensitive data on our computer networks and information technology systems, including our intellectual property and proprietary or confidential business information. The secure maintenance of such information is critical to our business. Furthermore, we have outsourced elements of our operations to third-party vendors, who each have access to our confidential information, which increases our risk of data breaches or cyber-attacks. Companies have been increasingly subject to a wide variety of security incidents, cyber-attacks and other attempts to gainunauthorized access, including ransomware attacks. These threats can come from a variety of sources, ranging in sophistication from an individual hacker to a state-sponsored attack and motives (including corporate espionage). Cyber threats may be generic, or they may be custom-crafted to target our information systems or those of our third-party vendors. Cyber-attacks are becoming increasingly more prevalent and much harder to detect and defendagainst. Sophisticated cyber attackers are skilled at adapting to existing security technology and developing new methods of gaining access to organizations’ sensitive business data, which could result in the loss of proprietary information, including trade secrets. We may not be able to anticipate all types of security threats, and
we may not be able to implement preventive measures effectiveagainst all such security threats. The techniques used by cyber criminals change frequently and may not be recognized until or after they are launched. Cybersecurity incidents, including phishing attacks and attempts to misappropriate or compromise confidential or proprietary information or sabotage enterprise IT systems are becoming increasingly frequent and more sophisticated. Cybersecurity incidents increasingly involve the use of artificial intelligence (“AI”) and machine learning (“ML”) to launch more automated, targeted and coordinated attacks on targets. Additionally, businesses which we have acquired, or may in the future acquire, may have information technology system vulnerabilities which could increase our risk of cybersecurity attacks. The information and data processed and stored in our technology systems, and those of our strategic partners, contract research organizations, contract manufacturers, suppliers, distributors or other third parties for which we depend to operate our business, may be vulnerable to loss, damage, denial-of-service, unauthorized access or misappropriation.
Our network and storage applications and those of our third-party vendors may be subject to unauthorized access by hackers or breached due to operator error, malfeasance or other system disruptions. We and certain of the third parties for which we depend on to operate our business may, and certain of such third parties have, experienced cybersecurity incidents, including third-party unauthorized access to and misappropriation of personal information, and may experience similar incidents in the future. These incidents could compromise our system infrastructure or lead to the loss, destruction, alteration, disclosure, or dissemination of, or damage or unauthorized access to, our data or data that is processed or maintained on our behalf, or other assets.
There can be no assurance that our cybersecurity risk management protocols will be sufficient to prevent or mitigate cyber-attacks. In addition, it is often difficult to anticipate or immediately detect such incidents and the damage that may be caused by such incidents, and it may take considerable time for us to investigate and evaluate the full impact of cyber-attacks, particularly for sophisticated attacks, which may inhibit our ability to provide prompt, full, and reliable information about cybersecurity incidents to our customers, regulators, and the public. These data breaches and any unauthorized access or disclosure of our information or intellectual property could compromise our intellectual property and expose sensitive business information, including our financial information or the information of our business partners. Cyber-attacks could cause us to incur significant remediation costs, disrupt key business operations, harm our reputation and divert attention of management and key information technology resources. We expect to incur significant costs in an effort to detect and prevent security incidents and otherwise implement our internal security and business continuity measures, and actual, potential, or anticipated attacks may cause us to incur increasing costs, including costs to deploy additional personnel and protection technologies, train employees, and engage third-party experts and consultants. We may face increased costs and find it necessary or appropriate to expend substantial resources in the event of an actual or perceived security breach. Our network security and data recovery measures and those of our third-party vendors may not be adequate to protect against such security breaches and disruptions. These incidents could also subject us to litigation and regulatory investigations, expose us to significant expense and cause significant harm to our business. Our insurance coverage may not be sufficient to prevent or recover from cyber-attacks, including coverage of applicable resulting losses arising from any such incident. In addition, such insurance may not be available to us in the future on economically reasonable terms, or at all. Further, our insurance may not cover all claims made against us and could have high deductibles in any event, and defending a suit, regardless of its merit, could be costly and divert management attention. Furthermore, if the information technology systems of our third-party vendors and other contractors and consultants become subject to disruptions or security breaches, we may have insufficient recourse against such third parties and we may have to expend significant resources to mitigate the impact of such an event, and to develop and implement protections to prevent future events of this nature from occurring.
The use of new and evolving technologies, such as AI and ML, in our operations, and the operations of third parties upon which we rely, may result in spending additional resources and present new risks and challenges that can impact our business including by posing security and other risks to our sensitive data, and as a result we may be exposed to reputational harm, other adverse consequences, and liability.
The use of new and evolving technologies, such as AI/ML, in our operations, and the operations of third parties upon which we rely presents new risks and challenges that could negatively impact our business. The use of certain AI/ML technologies can give rise to intellectual property risks, including compromises to proprietary intellectual property and intellectual property infringement. Additionally, several U.S. jurisdictions have proposed, enacted, or are considering, laws governing the development and use of AI/ML. Additionally, certain privacy laws extend rights to consumers (such as the right to delete certain personal data) and regulate automated decision making, which may be incompatible with our use of AI/ML. These obligations may make it harder for us to conduct our business using AI/ML, lead to regulatory fines or penalties, require us to change our business practices, retrain our AI/ML, or prevent or limit our use of AI/ML. For example, the Federal Trade Commission has required other companies to turn over (or disgorge) valuable insights or trainings generated through the use of AI/ML where they allege the company has violated privacy and consumer protection laws. If we cannot use AI/ML or that use is restricted, our business may be less efficient, or we may be at a competitive disadvantage. In addition, our vendors may in
turn incorporate AI/ML tools into their own offerings, and the providers of these AI/ML tools may not meet existing or rapidly evolving regulatory or industry standards, including with respect to privacy and data security. Further, bad actors around the world use increasingly sophisticated methods, including the use of AI/ML, to engage in illegal activities involving the theft and misuse of sensitive data. Any of these effects could damage our reputation, result in the loss of valuable property and information, cause us to breach applicable laws and regulations, and adversely impact our business.
divested
We are a pharmaceutical company with comprehensive commercial capabilities offering differentiated products designed to address patients’ needs. Our focus is on supporting patients by marketing products primarily in the oncology market. Our primary marketed products are:
ROLVEDON TM (eflapegrastim-xnst) injection for subcutaneous use
A long-acting granulocyte colony-stimulating factor (“G-CSF”) with a novel formulation that is indicated to decrease the incidence of infection, as manifested by febrile neutropenia, in adult patients with nonmyeloid malignancies receiving myelosuppressive anti-cancer drugs associated with clinically significant incidence of febrile neutropenia.
Sympazan® (clobazam) oral film
A benzodiazepine indicated for the adjunctive treatment of seizures associated with Lennox-Gastaut Syndrome (“LGS”) in patients aged two years of age or older. Sympazan is the only product to offer clobazam in a convenient film with PharmFilm® technology. Sympazan is taken without water or liquid, adheres to the tongue, and dissolves to deliver clobazam.
INDOCIN ® (indomethacin) Suppositories
A suppository and oral solution of indomethacin used both in hospitals and out-patient settings. Both products are nonsteroidal anti-inflammatory drugs (“NSAIDs”), indicated for:
• Moderate to severe rheumatoid arthritis including acute flares of chronic disease
A prescription NSAID indicated in adult patients for the short-term (up to five days) management of moderate to moderately severe pain that requires analgesia at an opioid level. SPRIX is a non-narcotic nasal spray that provides patients with moderate to moderately severe short-term pain relief through a form of ketorolac that is absorbed rapidly but does not require an injection administered by a healthcare provider.
CAMBIA ® (diclofenac potassium for oral solution)
A prescription NSAID indicated for the acute treatment of migraine attacks with or without aura in adults 18 years of age or older. CAMBIA can help patients with migraine pain, nausea, photophobia (sensitivity to light), and phonophobia (sensitivity to sound). CAMBIA is not a pill; it is a powder, and combining CAMBIA with water activates the medicine in a unique way.
2025 Transactions
On May 9, 2025, we transferred all the equity interests in Assertio Therapeutics to an established purchaser of legacy litigation matters, resulting in Assertio Therapeutics being owned by the purchaser’s related company, ATIH Industries, LLC (the “Therapeutics Transaction”). At the closing of the Therapeutics Transaction, Assertio Therapeutics held approximately $8.2 million in cash, insurance and retained a single-digit royalty based on net income derived from INDOCIN. In addition, Assertio Therapeutics retained certain legal liabilities, including those related to opioid litigation. As a result of the Therapeutics Transaction, we are not defendants in any opioid-related litigation.
As part of our ongoing commercial portfolio assessment, we ceased commercialization of Otrexup in July 2025.
In the third quarter of 2025, we advanced key integration efforts to consolidate operations and align our products, including ROLVEDON, under a single subsidiary, Assertio Specialty. Sales of ROLVEDON in 2025 reflected normal demand through the first nine months of 2025, as well as large purchases by several national distributors to help ensure consistent supply of ROLVEDON during the fourth quarter of 2025 and first quarter of 2026 as we complete the integration of ROLVEDON into Assertio Specialty. We did not record material net product sales of ROLVEDON during the fourth quarter of 2025 and do not anticipate material net product sales in the first quarter of 2026. Sales of the newly labeled ROLVEDON are expected to commence at a normal volume in the second quarter of 2026.
To facilitate the large purchases of ROLVEDON by several national distributors in the third quarter of 2025, we provided our customers with higher-than-historical levels of discounts and extended payment terms. These factors unfavorably impacted our net selling price and gross profit in the third quarter of 2025. The extended payment terms provided as part of these sales also led to reduced cash collections and a decline in our cash and short-term investments balance in the fourth quarter of 2025. We anticipate that the extended payment terms will lead to further reduced cash collections and a decline in our cash and short-term investments balances for the first quarter of 2026, but we expect that cash collections and our cash and short-term investments balances will increase in the second quarter of 2026. These factors will further lead to variability in our working capital balances during these periods.
On October 7, 2025, we entered into an amendment and restatement of the Manufacturing and Supply Agreement (the “Hanmi Agreement,” as amended, the “Amendment”) with Hanmi Pharmaceutical Co. Ltd. (“Hanmi”). The Amendment fixes the price that we pay for the remaining term of our license agreement with Hanmi and amends the payment timing for certain product royalties due to Hanmi, which have been fully accrued and resulted in an immaterial reclassification between Other current liabilities and Other long-term liabilities in our Consolidated Balance Sheet during the third quarter of 2025.
On December 26, 2025, we effected a 1-for-15 reverse stock split of our issued and outstanding common stock (the "Reverse Stock Split"). As a result of the Reverse Stock Split, our stockholders received one share of the Company’s common stock for every 15 shares held immediately prior to the effective time of the Reverse Stock Split. The Reverse Stock Split affected all our issued and outstanding shares of common stock equally. Any fractional shares remaining as a result of the Reverse Stock Split were paid to the shareholder in cash. The par value and number of authorized shares of our common stock were not adjusted as a result of the Reverse Stock Split. The Reverse Stock Split also affected our outstanding stock-based awards and convertible senior notes due 2027 and resulted in the shares underlying such instruments being reduced and the exercise price or conversion price being increased proportionately.
RESULTS OF OPERATIONS
The following table reflects our results of operations for the years ended December 31, 2025 and 2024 (in thousands):
Year ended December 31,
Revenues:
Product sales, net
Royalty revenue
Other revenue
Total revenues
Costs and expenses:
Cost of sales
Research and development expenses
Selling, general and administrative expenses
Change in fair value of contingent consideration
Amortization of intangible assets
Impairment of intangible assets
Restructuring charges
Total costs and expenses
Loss from operations
Other (expense) income:
Loss on Assertio Therapeutics divestiture
Interest expense
Interest income
Other gain, net
Total other (expense) income
Net loss before income taxes
Income tax expense
Net loss and comprehensive loss
Revenues
The following table reflects total revenues, net for the years ended December 31, 2025 and 2024 (in thousands):
Year ended December 31,
Product sales, net:
ROLVEDON
INDOCIN products
Sympazan
SPRIX
Other products
Total product sales, net
Royalty revenue
Other revenue
Total revenues
Product sales, net
ROLVEDON net product sales increased $8.1 million from $60.1 million for the year ended December 31, 2024 to $68.2 million for the year ended December 31, 2025, primarily due to higher volume, the adjustment of a prior period returns reserve of $5.4 million established in connection with our merger with Spectrum (the “Spectrum Merger”), partially offset by lower net pricing. The higher volume reflects large purchases by several national distributors during the third quarter of 2025 to help ensure consistent supply of ROLVEDON in the fourth quarter of 2025 and the first quarter of 2026 as we complete the integration into Assertio Specialty, as noted above. We did not record material net product sales of ROLVEDON during the fourth quarter of 2025 and do not anticipate material net product sales in the first quarter of 2026. Sales of the newly labeled ROLVEDON are expected to commence at a normal volume in the second quarter of 2026.
INDOCIN net product sales decreased $7.9 million from $26.8 million for the year ended December 31, 2024 to $18.9 million for the year ended December 31, 2025, primarily due to lower volume from previously announced generic competition. In 2026, we expect INDOCIN net product sales to continue to decline as a result of continued competition from existing generic entrants, as well as new and expected future generic entrants.
Sympazan net product sales increased $0.9 million from $10.5 million for the year ended December 31, 2024 to $11.3 million for the year ended December 31, 2025, primarily due to higher volume, partially offset by unfavorable payor mix.
SPRIX net product sales increased $0.3 million from $7.6 million for the year ended December 31, 2024 to $8.0 million for the year ended December 31, 2025, primarily due to favorable payor mix, partially offset by lower volume.
Other net product sales for the year ended December 31, 2025 and December 31, 2024 included net product sales of Otrexup of $4.5 million and $8.8 million, respectively, net product sales of CAMBIA of $5.7 million and $5.6 million, respectively, and net product sales of Zipsor of $0.5 million and $1.5 million, respectively. The year-over-year decrease in other net product sales was primarily due to lower Otrexup net product sales as a result of ceasing commercialization of Otrexup in July 2025.
For the year ended December 31, 2025, the amount recognized for gross-to-net sales allowances on product sales increased by $50.8 million compared to the year ended December 31, 2024, primarily due to higher ROLVEDON sales volumes and a continued shift in product mix toward ROLVEDON, which carries a higher contractual rebate rate than our other products. Refer to the Critical Accounting Policies and Significant Estimates section within this Item 7 and Schedule II to the accompanying Consolidated Financial Statements for additional information about amounts charged as a reduction to revenue for product sales allowances, product return allowances, discounts, chargebacks, and rebates. Our products operate in competitive markets and the impact of competition on net pricing could have an unfavorable impact on the amount of gross-to-net sales allowances recognized.
Royalty Revenue
In November 2010, we entered into a license agreement granting Tribune Pharmaceuticals Canada Ltd. (later known as Aralez Pharmaceuticals, Miravo Healthcare, and Searchlight Pharma, or “Searchlight,” now owned by Apotex Inc.) the rights to commercially market CAMBIA in Canada. The counterparty to the license agreement independently contracts with manufacturers to produce a specific CAMBIA formulation in Canada. We recognized royalty revenue related to the CAMBIA licensing agreement of $1.6 million and $2.0 million for the years ended December 31, 2025 and 2024, respectively.
The patents underlying the license agreement that we have with Searchlight expire in June 2026, and we anticipate that there will be generic competition in Canada after the patents expire, or the earlier negotiated launch of generics in connection with the settlement of patent litigation, resulting in increased competition with CAMBIA upon patent expiration. As a result, we anticipate the amount of royalty revenue earned under the license agreement could be reduced to zero beginning in the third quarter of 2026.
Other revenue
Other revenue consists of sales adjustments for previously divested products, which includes adjustments to reserves for product s ales allowances (gross-to-net sales allowances) and can res ult in a reduction to or an increase to total revenue in the period of recognition. There was no other revenue for the year ended December 31, 2025. Sales adjustments for reserves recorded in prior periods for previously divested products resulted in an increase to total revenue of $2.1 million for the year ended December 31, 2024.
Cost of Sales
Cost of sales consists of costs of the active pharmaceutical ingredient, contract manufacturing and packaging costs, royalties payable to third parties, inventory write-downs and scrap, product quality testing, distribution costs, and shipping costs related to our product sales. Cost of sales excludes the amortization of intangible assets. Fair value of inventories acquired through business combinations or asset acquisitions include an inventory step-up within the value of inventories. The inventory step-up value is amortized as the related inventory is sold, and included in cost of sales.
Cost of sales decreased $3.8 million from $39.2 million for the year ended December 31, 2024 to $35.4 million for the year ended December 31, 2025, primari ly due to (i) a $6.6 million decrease in inventory write-downs, primarily for INDOCIN due to lower demand for INDOCIN products, (ii) a $4.6 million of ROLVEDON inventory step-up amortization included in the year ended December 31, 2024, which did not recur in the year ended December 31, 2025, (iii) a $1.9 million decrease in Otrexup cost of sales primarily due to ceasing commercialization of Otrexup in July 2025, (iv) a $0.9 million decline in INDOCIN cost of sales due to lower INDOCIN sales volume, and (v) a $0.2 million decrease in other cost of sales. The decrease was partially offset by a $7.9 million increase from the impact of higher ROLVEDON volumes on cost of sales driven by the sales of ROLVEDON inventory during the third quarter of 2025 noted above, and $2.5 million of one-time costs related to ceasing commercialization of Otrexup in July 2025.
Cost of sales are impacted by both product volume and mix, changes in which will have an impact on Cost of sales recognized by us in future periods.
Research and Development Expenses
Research and development expenses include salaries, costs for clinical trials, consultant fees, supplies, and allocations of corporate costs. Research and development expenses were $1.7 million and $3.8 million for the years ended December 31, 2025 and 2024, respectively, primarily representing costs directly associated with ongoing clinical activity for the ROLVEDON pediatric safety trial in 2025 and 2024, as well as the same-day dosing trial in 2024.
Selling, General and Administrative Expenses
Selling, general and administrative expenses primarily consist of personnel, contract personnel, marketing and promotion expenses, personnel expenses to support our administrative and operating activities, facility costs, and professional expenses, such as legal and accounting fees.
Selling, general, and administrative expenses decreased $6.1 million from $75.1 million for the year ended December 31, 2024 to $69.0 million for the year ended December 31, 2025, primarily due to (i) a $4.7 million net decrease in legal charges and settlements of certain litigation items, (ii) $2.4 million of income recognized during the year ended December 31,
2025 related to the lapsing of the statute of limitations for employee retention tax credits, of which there was none in 2024, (iii) a $1.6 million decrease in stock-based compensation expense, primarily driven by forfeitures related to our 2025 restructuring actions, and (iv) a $0.2 million decrease in other general operating expenses. The decrease was partially offset by $1.7 million of one-time costs related to ceasing commercialization of Otrexup and $1.1 million of costs related to the Therapeutics Transaction recognized in the year ended December 31, 2025.
Change in Fair Value of Contingent Consideration
In connection with the Spectrum Merger , we issued contingent value rights (“CVRs”) that represent a contingent consideration obligation that is measured at fair value. In connection with the merger with Zyla Life Sciences (“Zyla”) in May 2020 (the “Zyla Merger”), we assumed a contingent consideration obligation for future royalties on annual INDOCIN product net sales that is measured at fair value. Change in fair value of contingent consideration represents the change in fair value, if any, of our contingent consideration obligations which are remeasured each reporting period.
We recognized a benefit of $0.3 million and $0.2 million during the years ended December 31, 2025 and December 31, 2024, respectively, for the change in f air value of contingent consideration incurred in the Zyla Merger. We recognized no expense or benefit for the change in fair value of the CVR contingent consideration obligation during the years ended December 31, 2025 or December 31, 2024, as the milestones triggering payment of the obligation were not met.
We do not expect to recognize a contingent consideration obligation in future periods nor make any contingent consideration payments related to the above in 2026 or beyond.
Amortization of Intangible Assets
The following table reflects amortization of intangible assets for the years ended December 31, 2025 and 2024 (in thousands):
Year ended December 31,
Amortization of intangible assets—ROLVEDON
Amortization of intangible assets—Sympazan
Amortization of intangible assets—SPRIX
Amortization of intangible assets—INDOCIN
Amortization of intangible assets—Otrexup
Total amortization of intangible assets
Amortization expense increased $4.2 million from $25.6 million for the year ended December 31, 2024 to $29.9 million for the year ended December 31, 2025, primarily due to an increase of $11.3 million related to a change in the remaining estimated useful life of the ROLVEDON product rights intangible assets effective December 31, 2024, as well as a $0.2 million increase related to a change in the remaining estimated useful life of the SPRIX product rights intangible assets effective October 1, 2025. This was partially offset by a net decrease of $6.2 million due to the full amortization of the remaining value of the INDOCIN intangible assets in the second quarter of 2025 and a $1.0 million decrease resulting from the full impairment of the Otrexup intangible asset group in the fourth quarter of 2024.
Impairment of Intangible Assets
During each quarter of 2025 and 2024, our market capitalization was below the book value of our equity, which management determined represented an indicator of impairment with respect to our long-lived assets. For the three months ended September 30, 2025, we also recognized an additional indicator of impairment in our SPRIX asset group related to a change in the expected timing of cash flows from SPRIX net product sales. Applying the relevant accounting guidance, we first assessed the recoverability of our long-lived assets at the product level at each date.
For the assessment performed for the three months ended September 30, 2025, we determined that the undiscounted cash flows and the fair value of the SPRIX asset group were less than its carrying value and recognized an impairment for this asset group of $1.7 million during the third quarter of 2025, reducing its carrying value to $4.6 million. Additionally, effective October 1, 2025, we revised the remaining estimated useful life of the SPRIX product rights intangible assets to one year, which we believe better reflects the realization of the economic benefit of the intangible asset.
For the assessment performed for the three months ended December 31, 2024, we determined that the estimated undiscounted cash flows and fair value of the Otrexup asset group were less than its carrying value and recognized an impairment for this asset group of $5.2 million during the fourth quarter of 2024 , reducing its carrying value to zero.
For all the assessments for our other asset groups performed during each quarter in 2025 and 2024, we determined that the estimated undiscounted cash flows were in excess of the carrying amounts for all our long-lived asset groups at each impairment testing date. Accordingly, we concluded that the long-lived asset groups were fully recoverable and no adjustment to their carrying values was required.
Although the SPRIX asset group was written down to its fair value as of September 30, 2025, the sum of the undiscounted cash flows could continue to decrease in the event of significant unfavorable changes in their estimated undiscounted future cash flows due to increased competition. Any significant unfavorable changes in the estimated undiscounted future cash flows may also impact the related assets, such as inventory, leading to potential charges in addition to a potential impairment. Any future impairment of our long-lived assets may result in material charges that could have a material adverse effect on our business and financial results.
Restructuring Charges
We regularly evaluate our operations to identify opportunities to streamline operations and optimize operating efficiencies in anticipation of changes in the business environment. As such, Company management may approve, from time to time, plans to reduce costs and improveefficiencies, which may result in incurring costs associated with those restructuring efforts.
Restructuring charges related to employee compensation costs were $2.9 million and $0.7 million for the years ended December 31, 2025 and December 31, 2024, respectively. Cash payments during the years ended December 31, 2025 and December 31, 2024 related to our various restructuring efforts were $1.7 million and $3.9 million, respectively.
During the fourth quarter of 2025, we recognized $1.2 million in restructuring costs associated with a reduction in our workforce. We may incur additional restructuring charges related to this restructuring effort. All related cash payments are expected to be completed by the fourth quarter of 2026.
Effective as of October 27, 2025, we separated from the service of our former Chief Executive Officer. Pursuant to his then existing Management Continuity Agreement with the Company, he was entitled to severance compensation and benefits of approximately $1.4 million, which were recognized as Restructuring charges during the year ended December 31, 2025. All related cash payments are expected to be completed by the second quarter of 2027. We do not expect to recognize any additional restructuring charges related to his separation from us.
During the first quarter of 2025, we recognized $0.3 million in restructuring costs associated with improvingefficiencies within our sales and marketing organization. We do not expect to recognize any additional restructuring charges related to this restructuring effort, and a ll related cash payments were completed by the third quarter of 2025.
Other (Expense) Income
The following table reflects Other (expense) income for the years ended December 31, 2025 and 2024 (in thousands):
Year ended December 31,
Loss on Assertio Therapeutics divestiture
Interest expense
Interest income
Other gain, net
Total other (expense) income
Total other (expense) income changed by $11.4 million from income of $2.9 million for the year ended December 31, 2024 to expense of $8.4 million for the year ended December 31, 2025, primarily due to an $8.2 million loss on the divestiture of Assertio Therapeutics recognized during the second quarter of 2025, as described in “Item 8. Financial Statements and
Supplementary Data – Note 2 . Divestitures and Strategic Transactions,” and the favorable impact of a $2.6 million customer reimbursement recognized in the year ended December 31, 2024 that did not repeat in 2025.
The following table reflects interest expense for the years ended December 31, 2025 and 2024 (in thousands):
Year ended December 31,
Interest on 2027 Convertible Notes
Amortization of debt issuance costs on 2027 Convertible Notes
Total interest expense
Income Tax Provision
We recorded income tax expense of $0.4 million and $0.1 million for the years ended December 31, 2025 and December 31, 2024, respectively. The difference between the income tax expense and the tax at the federal statutory rate of 21.0% in each period was primarily due to changes in the valuation allowance due to our net loss, partially offset by state tax expense and the loss recorded on sale of Assertio Therapeutics. As of December 31, 2025 and December 31, 2024, we concluded that it is not more likely than not that the net deferred tax asset recorded as of those dates will be realized. As a result, we recorded a full valuation allowance against our net deferred tax asset as of both December 31, 2025 and December 31, 2024.
On July 4, 2025, the President of the United States signed House Resolution 1 (“H.R. 1”), which made a number of changes to tax law in the Internal Revenue Code, including the reinstatement of immediate expensing for domestic research and development expenditures and modifications to the business interest expense limitation. The changes to tax law promulgated under H.R. 1 did not have a material impact on our income tax expense or income tax account balances for the year ended December 31, 2025.
LIQUIDITY AND CAPITAL RESOURCES
We have financed, and continue to finance, our operations and business development efforts primarily from product sales, the proceeds of secured borrowings, and public sales of equity securities, including convertible debt securities.
We believe that our existing cash, cash equivalents and short-term investments, which totaled $63.4 million at December 31, 2025, will be sufficient to fund our operations and make the required payments under our debt agreements due for the next 12 months from the date of this filing. We base this expectation on our current operating plan, which may change as a result of many factors.
Our cash needs may vary materially from our current expectations because of numerous factors, including:
• reductions in net product sales and gross margin in the first quarter of 2026 due to the transition of ROLVEDON from Spectrum to Assertio Specialty;
• changes in our working capital needs, including the timing of purchases and manufacturing of our inventories, the timing of payment of our accounts payable and accrued rebates, returns and discounts, and the timing of accounts receivable collections, due to the large purchases of ROLVEDON inventory by several national distributors in the third quarter of 2025 noted above;
• interest and principal payments on our current and future indebtedness;
• our level of expenditures related to the commercialization of our products, including our efforts to manage supply costs and enhance the long-term prospects of ROLVEDON product sales;
• the timing of our purchases of inventory pursuant to our supply agreements, including those that may be required under the Amendment to the Hanmi Agreement, and the impact this may have on our inventory purchases in future periods;
• declines in sales of our marketed products, including those resulting from the entry and sales of generics and/or other products competitive with any of our products;
• potential additional expenses relating to any litigation matters, as discussed in “Item 8. Financial Statements and Supplementary Data - Note 8 . Commitments and Contingencies;”
• potential payments required as a result of ceasing commercialization of Otrexup in July 2025;
• potential payments for income and other taxes to the extent that they cannot be offset against our net operating loss (“NOL”) carryforwards;
• acquisitions or licenses of complementary businesses, products, technologies or companies;
• financial terms of definitive license agreements or other commercial agreements we may enter into;
• milestone and royalty revenue we receive under our collaborative development arrangements;
• changes in the focus and direction of our business strategy and/or research and development programs;
• potential expenses, including termination expenses if a decision is made to cease development of Spectrum’s de-prioritized development asset poziotinib; and
• expenditures related to future clinical trial costs.
We expect our cash needs will be met by our existing cash, cash equivalents, and short-term investments, including funding our future operations, payments due under our debt agreement, ongoing legal expenses and settlement payments, or product acquisitions and strategic transactions that we may pursue. We expect that ongoing legal expenses will, and any settlements that we are able to negotiate may, continue to be a significant usage of cash in 2026. We may be required to raise additional capital if our cash needs increase significantly from current expectations.
On August 22, 2022, we issued $70.0 million aggregate principal amount of convertible senior notes which mature on September 1, 2027 and bear interest at a rate of 6.5% per annum, payable semi-annually in arrears on March 1 and September 1 of each year (the “2027 Convertible Notes”). On February 27, 2023, we completed a privately negotiated exchange of $30.0 million principal amount of the 2027 Convertible Notes.
The terms of the 2027 Convertible Notes are governed by an indenture dated August 25, 2022 (the “2027 Convertible Note Indenture”). Pursuant to the terms of the 2027 Convertible Note Indenture, we and our restricted subsidiaries must comply with certain covenants, including mergers, consolidations, and divestitures; guarantees of debt by subsidiaries; issuance of preferred and/or disqualified stock; and liens on our properties or assets. We were in compliance with our covenants with respect to the 2027 Convertible Notes as of December 31, 2025.
The following table reflects summarized cash flow activities for the years ended December 31, 2025 and 2024 (in thousands):
Year ended December 31,
Net cash (used in) provided by operating activities
Net cash used in investing activities
Net cash used in financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Cash Flows from Operating Activities
Cash used in operating activities was $28.2 million for the year ended December 31, 2025 compared to cash provided by operating activities of $26.4 million for the year ended December 31, 2024. The change was primarily due to higher net working capital needs and lower net product sales.
Operating assets and liabilities resulted in a net cash use of $45.3 million for the year ended December 31, 2025 compared to net cash provided of $5.2 million for the year ended December 31, 2024. The change was primarily due to a $59.5 million increase in accounts receivable primarily associated with the large purchases of ROLVEDON by several national distributors in the third quarter of 2025, which included extended payment terms provided to ROLVEDON customers as further discussed above in “COMPANY OVERVIEW,” as well as higher settlements of accrued liabilities, particularly accrued legal costs, and accounts payable due to timing. This was partially offset by lower inventory purchases, particularly for the ROLVEDON active pharmaceutical ingredient, and higher accruals from the timing of settlements of accrued rebates, returns and discounts related to the sale of ROLVEDON inventory at the end of the third quarter of 2025.
Cash flows from operating activities are impacted by, among other things, product revenue, operating profit and changes in working capital. Fluctuations in any of these will impact our cash flows from operating activities recognized in future periods. Due to the large purchases of ROLVEDON by several national distributors in the third quarter of 2025, the timing of related cash collections and payments is expected to reduce cash flows from operating activities in the first quarter of 2026, with cash flows from operating activities expected to increase in the second quarter of 2026.
Cash Flows from Investing Activities
Cash used in investing activities was $12.0 million for the year ended December 31, 2025, which consisted of $119.2 million of purchases of short-term investments and an $8.2 million investing outflow from cash transferred in the Therapeutics Transaction, offset by $115.4 million of proceeds from maturities of short-term investments. Refer to Note 2 . Divestitures and Strategic Transactions included in “Item 8. Financial Statements and Supplemental Data for details regarding the Therapeutics Transaction.
Cash used in investing activities was $48.9 million for the year ended December 31, 2024, which consisted of $98.6 million of purchases of short-term investments, partially offset by $49.7 million of proceeds from maturities of short-term investments. Beginning in the second quarter of 2024, we began purchasing and holding highly liquid marketable securities with maturities dates at purchase of more than three months and less than one year.
Cash Flows from Financing Activities
Cash used in financing activities for the year ended December 31, 2025 and December 31, 2024 was $0.2 million and $0.4 million, respectively, and consisted entirely of cash used from employees’ withholding tax liability upon the vesting of employee stock awards.
Contractual Obligations
Our principal material cash requirements consist of obligations related to our payments for rebates, returns and discounts, payments for debt, non-cancelable leases for our office space, non-cancelable contractual obligations for our purchase commitments, and cash payments for our restructuring activities. Refer to “Item 8. Financial Statements and Supplemental Data - Note 1, Note 6 , Note 7 , Note 8 and Note 16 ,” respectively. We generally expect to satisfy these requirements and commitments with cash on hand and cash provided by operating activities.
CRITICAL ACCOUNTING POLICIES AND SIGNIFICANT ESTIMATES
Our consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and SEC regulations for annual reporting. Our management’s discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements. The preparation of our consolidated financial statements requires us to make estimates, assumptions and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. We evaluate our estimates on an ongoing basis. We base our estimates on historical experience and various other assumptions that we believe to be reasonable under the circumstances, the results of which form our basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from those estimates under different assumptions or conditions. We believe the following critical accounting policies reflect the more significant judgments and estimates used in the preparation of our consolidated financial statements.
A more detailed discussion of our significant accounting policies may be found in “ Note 1 . Organization and Significant Accounting Policies” of the Notes to the Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K, and the impact and risks associated with our accounting policies are discussed throughout this Annual Report on Form 10‑K and in the Notes to the Consolidated Financial Statements.
Revenue Recognition
Product sales revenue is recognized when the customer has control of the product, which is when title has transferred to the customer and the customer has assumed the risks and rewards of ownership. These conditions typically occur upon delivery to the customer. Our performance obligation is to deliver product to the customer, and the performance obligation is typically completed upon delivery. The transaction price consists of a fixed invoice price and variable product sales allowances, which include rebates, discounts and returns. Product sales revenues are recorded net of applicable sales tax and reserves for these product sales allowances (also referred to as gross-to-net sales allowances).
Product sales allowances consist primarily of provisions for product returns, managed care rebates, commercial rebates, and government rebates (managed care rebates, commercial rebates and government rebates are collectively referred to as “rebates”), wholesaler and pharmacy discounts, prompt pay discounts, patient discount programs, and chargebacks. We
consider product sales allowances to be variable consideration and estimate and recognize product sales allowances as a reduction of product sales in the same period the related revenue is recognized. Product sales allowances are based on actual or estimated amounts owed on the related sales. These estimates take into consideration the terms of our agreements with customers, historical returns, rebates or discounts taken by product, estimated levels of inventory in the distribution channel, the shelf life of the product, and specific known market events, such as competitive pricing and new product introductions. We use the most likely method in estimating product sales allowances. If actual future results vary from our estimates, we may need to adjust the estimates, which could affect product sales and earnings in the period of adjustment.
Our estimates related to gross‑to‑net sales adjustments for product return allowances and rebates are judgmental and are subject to change based on our historical experience and certain quantitative and qualitative factors. We believe that our estimates related to gross‑to‑net sales adjustments for wholesaler and pharmacy discounts, prompt payment discounts, patient discount programs and chargebacks do not have a high degree of estimation complexity or uncertainty, as the related amounts are settled within a relatively short period of time. The timing of ultimate settlement of returns- and chargebacks-related allowances can be prolonged by our process to validate such adjustments before settlement is finalized.
Product Returns - We allow customers to return product for credit with respect to that product generally within six months before and 12 months after the product expiration date. We estimate product returns based on historical return trends by product or by return trends of similar products, taking into consideration the shelf life of the product at the time of shipment, shipment and prescription trends, estimated distribution channel inventory levels and consideration of the introduction of competitive products. We do not assume financial responsibility for returns of any of our currently marketed products acquired through product rights acquisitions if those returns relate to sales of that product prior to or after the period of our ownership of the respective product, which are identified by specific lot numbers.
Shelf lives for our products, from the respective manufacture dates, range from 24 months to 48 months. Because of the shelf life of our products and our return policy of issuing credits with respect to product that is returned within six months before and 12 months after our product expiration date, there may be a significant period of time between when the product is shipped and when we issue credit on a returned product. Accordingly, we may have to adjust these estimates, which could affect product sales and earnings in the period of adjustments.
Managed Care Rebates - We offer discounts under contracts with certain managed care providers. We generally pay managed care rebates one to three months after prescriptions subject to the rebate are filled.
Commercial Rebates - We offer certain group purchasing organization (“GPO”) rebates for end-user purchases made under contractual rebate percentage tier programs. Commercial rebates are based on (i) our estimates of end-user purchases through a GPO, (ii) the corresponding contractual rebate percentage tier we expect each GPO to achieve, and (iii) our estimates of the impact of any prospective rebate program changes made by us. We generally pay commercial rebates two to 12 months after qualifying purchases are made.
Government Rebates - We offer discounted pricing or rebates on purchases of pharmaceutical products under various federal and state healthcare programs, including Centers for Medicare & Medicaid Services’ Medicaid Drug Rebate Program, Medicare Part B Program and Medicare Part D Coverage Gap Discount Programs. We generally pay government rebates three to 12 months after prescriptions subject to the rebate are filled. These rebates are subject to our active participation in the respective programs.
The following table reflects activity relating to the Company’s provision for product sales allowances as of December 31, 2025 and 2024 (in thousands):
Product Returns
Rebates (1)
Other Sales Allowances (2)
Total (5)
Balance as of December 31, 2023
Provisions made in current period to Product Sales, net (3)
Provisions made in current period to Other revenue (4)
Payments and credits made in current period
Balance as of December 31, 2024
Provisions made in current period to Product Sales, net (3)
Payments and credits made in current period
Balance as of December 31, 2025
(1) Rebates consist of managed care rebates, commercial rebates and government rebates.
(2) Other Sales Allowances consist of wholesaler and pharmacy discounts, prompt pay discounts, patient discount programs, and chargebacks.
(3) Includes adjustments to revenue recognized as a result of changes in estimates for the Company’s gross-to-net sales allowances for products sold in previous periods, which were approxima tely 7% a nd 3% for the years ended December 31, 2025 and 2024, respectively. In addition, ROLVEDON net product sales for the year ended December 31, 2025 included the adjustment of a prior period returns reserve of $5.4 million established in connection with the Spectrum Merger.
(4) Consists of sales adjustments for previously divested products recognized in Other revenue in the Consolidated Statements of Comprehensive Loss.
(5) Balance includes allowances for cash discounts for prompt payment of $3.0 million and $1.2 million as of December 31, 2025 and 2024, respectively, which are recognized in Account receivable, net in the Company’s Consolidated Balance Sheets. The remaining balance of $99.4 million and $76.3 million as of December 31, 2025 and 2024, respectively, is recognized in Accrued rebates, returns and discounts in the Company’s Consolidated Balance Sheets.
Impairment of Long-lived Assets
We evaluate long-lived assets, including property and equipment and acquired intangible assets consisting of product rights, for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. An impairment would be recognized when the estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition are less than its carrying amount. The impairment is calculated as the excess of the carrying amount over the fair value. Estimating future cash flows and fair value related to an intangible asset involves significant estimates and assumptions. If our assumptions are not correct, there could be an impairment or, in the case of a change in the estimated useful life of the asset, a change in amortization expense. Refer to “Results of Operations – Impairment of Intangible Assets ” within this Item 7 and “Item 8. Financial Statements and Supplemental Data – Note 5 . Intangible Assets” for a discussion of the results of our 2025 and 2024 assessments of the recoverability and impairment of our long-lived assets.
Income Taxes
We record the estimated future tax effects of temporary differences between the tax basis of assets and liabilities and amounts reported in our accompanying consolidated balance sheets, as well as operating loss and tax credit carryforwards. We follow the guidelines set forth in the applicable accounting guidance regarding the recoverability of any tax assets recorded on the consolidated balance sheet and provide any necessary allowances as required. Determining necessary allowances requires us to make assessments about the timing of future events, including the probability of expected future taxable income and available tax planning opportunities. When we determine that it is more-likely-than-not that some portion or all the deferred tax assets will not be realized in the future, the deferred tax assets are reduced by a valuation allowance. The valuation allowance is sufficient to reduce the deferred tax assets to the amount that we determine is more-likely-than-not to be realized.
We are subject to examination of our income tax returns by various tax authorities on a periodic basis. We regularly assess the likelihood of adverse outcomes resulting from such examinations to determine the adequacy of our provision for income taxes. We have applied the provisions of the applicable accounting guidance on accounting for uncertainty in income taxes, which requires application of a more‑likely‑than‑not threshold to the recognition and derecognition of uncertain tax positions. If the recognition threshold is met, the applicable accounting guidance permits us to recognize a tax benefit measured at the largest amount of tax benefit that, in our judgment, is more than 50% likely to be realized upon settlement. It further requires that a change in judgment related to the expected ultimate resolution of uncertain tax positions be recognized in earnings in the period of such change.
As of December 31, 2025, we have recorded a full valuation allowance against our net deferred tax assets. In evaluating our ability to realize our deferred tax assets, we consider available positive and negative evidence, including past operating results and forecasts of future taxable income, and the potential Internal Revenue Code section 382 limitation on NOL carryforwards due to a change in control. In determining future taxable income, we make assumptions to forecast U.S. federal and state operating income, the reversal of temporary differences, and the implementation of any feasible and prudent tax planning strategies.
These assumptions require significant judgment regarding the forecasts of the future taxable income in each tax jurisdiction and are consistent with the forecasts used to manage our business. We have generated a top-line and as-adjusted cumulative loss for the three year period ended December 31, 2025. All our deferred tax assets (“DTA”) are recorded by our U.S. operations, and the U.S. does not permit carryback of losses. As such, we can only rely on the reversal of existing taxable temporary differences to be considered as positive evidence in analyzing future use of existing DTAs. We analyzed the existing taxable temporary differences, but determined they were insufficient for generating future taxable income to permit full use of the existing DTAs. Additionally, we did not identify any tax planning strategies or tax planning actions which would allow for the use of the net domestic DTAs recorded as of December 31, 2025.
We recognize tax liabilities in accordance with Accounting Standards Codification Topic 740, Income Taxes , and we adjust these liabilities when our judgment changes as a result of the evaluation of new information not previously available. Due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from our current estimate of the tax liabilities. These differences are reflected as increases or decreases to income tax expense in the period in which they are determined.
See “Item 8. Financial Statements and Supplemental Data - Note 14 . Income Taxes” for additional information.
RECENT ACCOUNTING PRONOUNCEMENTS
See “Item 8. Financial Statements and Supplemental Data - Note 1 . Organization and Summary of Significant Accounting Policies” for additional information on recent accounting pronouncements.
