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Item 7. Management’s Discussion and Analysis

2024-02-28 compared with 2023-03-23 · 470 added, 314 removed, 155 unchanged (83% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion of our financial condition and results of operations should be read in conjunction with the consolidated financial statements and notes thereto included elsewhere in this Annual Report on

The various sections of this discussion contain a number of forward-looking statements, all of which are based on our current expectations and could be materially affected by the uncertainties and risk factors described throughout this

Annual Report.

See “Special Note Regarding Forward-Looking Statements.” Our actual results may differ materially.

ADMA Biologics, Inc.

(the “Company,” “ADMA,” “we,” “us” or “our”) is an end-to-end commercial biopharmaceutical company dedicated to manufacturing, marketing and developing specialty plasma-derived biologics for the

treatment of immunodeficient patients at risk for infection and others at risk for certain infectious diseases.

Our targeted patient populations include immune-compromised individuals who suffer from an underlying immune deficiency disorder or

who may be immune-suppressed for medical reasons.

(the “Company,” “ADMA,” “we,” “us” or “our”) is an end-to-end commercial biopharmaceutical company dedicated to manufacturing, marketing and developing specialty biologics for the treatment of

immunodeficient patients at risk for infection and others at risk for certain infectious diseases.

Our targeted patient populations include immune-compromised individuals who suffer from an underlying immune deficiency disorder or who may be

immune-suppressed for medical reasons.

Through our ADMA BioManufacturing business segment, we currently have three products with U.S.

Food and Drug Administration (the “FDA”) approval, all of which are currently marketed and commercially available:

BIVIGAM (Immune Globulin Intravenous, Human), an Intravenous Immune Globulin (“IVIG”) product indicated for the treatment of Primary Humoral Immunodeficiency (“PI”), also known as Primary Immunodeficiency Disease (“PIDD”) or Inborn Errors of

Immunity, and for which we received FDA approval on May 9, 2019 and commenced commercial sales in August 2019;

(ii) ASCENIV (Immune Globulin Intravenous, Human – slra 10% Liquid), an IVIG product indicated for the treatment of PI, for which we

received FDA approval on April 1, 2019 and commenced first commercial sales in October 2019;

and (iii) Nabi-HB (Hepatitis B Immune Globulin, Human), which is indicated for the treatment of acute exposure to blood containing HBsAg and other listed

exposures to Hepatitis B.

ASCENIV (Immune Globulin Intravenous, Human – slra 10% Liquid), an Intravenous Immune Globulin (“IVIG”) product indicated for the treatment of Primary Humoral Immunodeficiency (“PI”), also known as Primary Immunodeficiency Disease (“PIDD”) or

Inborn Errors of immunity in adults and adolescents, for which we received FDA approval on April 1, 2019 and commenced first commercial sales in October 2019;

(ii) BIVIGAM (Immune Globulin Intravenous, Human), an IVIG product indicated for the

treatment of PI, and for which we received FDA approval on May 9, 2019 and commenced commercial sales in August 2019;

and (iii) Nabi-HB (Hepatitis B Immune Globulin, Human), which is indicated for the treatment of acute exposure to blood containing

HBsAg and other listed exposures to Hepatitis B.

We seek to develop a pipeline of plasma-derived therapeutics, including a product based on our most recently approved patent application under U.S.

10,259,865 related to methods of treatment and prevention of

10,259,865 related to methods of

treatment and prevention of S.

pneumonia infection for an immunoglobulin manufactured to contain standardized antibodies to numerous serotypes of S.

Our products and product

candidates are intended to be used by physician specialists focused on caring for immune-compromised patients with or at risk for certain infectious diseases.

products and product candidates are intended to be used by physician specialists focused on caring for immune-compromised patients with or at risk for certain infectious diseases.

We manufacture these products at our FDA-licensed, plasma fractionation and purification facility located in Boca Raton, Florida with a peak annual processing capability of up to 600,000 liters (the “Boca Facility”).

Based on current production yields, our ongoing supply chain enhancements and capacity expansion initiatives, we believe this facility has the potential to produce sufficient quantities of our immune globulin (“IG”) products representing annual

revenues of $210 million or more in 2023, more than $250 million in annual revenue in 2024 and potentially in excess of $300 million of annual revenue thereafter, as well as achieving profitability during the first quarter of 2024.

revenue levels, we forecast achieving consolidated gross margins in the range of 40-50% and net income margins in the range of 20-30%.

These assumptions translate to potential annual gross profit and net income in the range of $100-150 million

and $50-100 million, respectively, during the 2024-2025 time period and beyond.

Through our ADMA BioCenters subsidiary, we currently operate ten source plasma collection facilities in the U.S.

This business unit, which we refer to as our Plasma Collection Centers business segment, provides us

with a portion of our blood plasma for the manufacture of our products, and also allows us to sell certain quantities of source plasma to third-party customers for further manufacturing.

With respect to our operational plasma collection centers,

eight plasma collection centers currently hold FDA licenses, with the remaining plasma collection centers anticipated to receive FDA approvals throughout 2023.

In addition, three of our FDA-approved plasma collection centers also have approvals

from the Korean Ministry of Food and Drug Safety (“MFDS”), as well as FDA approval to operate a Hepatitis B immunization program.

After giving effect to the supply chain robustness initiatives undertaken in 2021 and 2022 as it pertains to our

plasma collection network expansion, we remain on track to achieve our goal of having 10 FDA-licensed plasma collection centers by the end of 2023.

A typical plasma collection center, such as those operated by ADMA BioCenters, can collect

approximately 30,000 to 50,000 liters of source and hyperimmune plasma annually, which may be sold for different prices depending upon the type of plasma, quantity of purchase and market conditions at the time of sale.

Plasma collected from ADMA

BioCenters’ facilities that is not used to manufacture our products is sold to third-party customers in the U.S.

Based on current production yields, our completed and ongoing supply chain enhancements and capacity expansion initiatives, we believe this facility has the potential to produce sufficient quantities of our immune globulin (“IG”) products

representing annual revenues of approximately $330 million in 2024 and potentially $380 million in 2025.

At these revenue levels, we forecast achieving consolidated gross margins in the range of 40-50% and net income margins in the range of 20-30%.

These assumptions translate to potential fiscal year 2024 and 2025 net income of $65 million and $115 million or more and adjusted EBITDA of $90 million and $140 million or more, respectively.

For the year ended December 31, 2023 we had a net loss of loss of $28.2 million and achieved adjusted net income of $0.7 million which, as further described under “Non-GAAP Financial Measures”, excludes charges related

to the refinancing of our senior debt of $26.2 million and an IT systems disruption of $2.7 million (see Management’s Discussion and Analysis of Financial Condition and Results of Operations).

We also achieved positive cash flow from operations for

the year ended December 31, 2023 for the first time in the Company’s history, primarily as a result of our significant revenue growth and continued physician, patient and payer acceptance of ASCENIV and BIVIGAM that we have experienced over the

past several years.

Through our ADMA BioCenters subsidiary, we currently operate ten source plasma collection facilities in the U.S., all of which hold FDA licenses.

This business unit, which we refer to as our Plasma Collection Centers

business segment, provides us with the blood plasma required for the manufacture of our products, and also allows us to sell certain quantities of source and hyperimmune plasma to third-party customers for further manufacturing.

In addition, three

of our FDA-approved plasma collection centers also have approvals from the Korean Ministry of Food and Drug Safety (“MFDS”), as well as FDA approval to operate a Hepatitis B immunization program.

A typical plasma collection center, such as those

operated by ADMA BioCenters, can collect approximately 30,000 to 50,000 liters of source plasma annually, which may be sold for different prices depending upon the type of plasma, quantity of purchase and market conditions at the time of sale.

Plasma collected from ADMA BioCenters’ facilities that is not used to manufacture our products is sold to third-party customers in the U.S.

and in other locations outside the U.S.

where we are approved under supply agreements or in the open “spot” market.

We sell plasma-derived intermediate fractions to certain customers, which are generated as part of our FDA-approved manufacturing process for IG and IVIG products.

In January 2020, we announced our entry into a

five-year manufacturing and supply agreement to produce and sell these intermediate by-products, which are used as the starting raw material to produce other plasma-derived biologics.

In addition, from time to time we provide contract

manufacturing services for certain third-party clients.

We also provide laboratory contracting services to certain customers and anticipate providing contract filling, labeling and packing services utilizing our FDA-approved in-house fill-finish

capabilities.

On June 6, 2017, we completed the acquisition of certain assets (the “Biotest Assets”) of the Therapy Business Unit (“BTBU”) of Biotest Pharmaceuticals Corporation (“BPC” and, together with Biotest AG, “Biotest”),

which included two FDA-licensed products, Nabi-HB and BIVIGAM, and the Boca Facility (the “Biotest Transaction”).

where we are approved under supply agreements or in the open “spot”

We sell plasma-derived intermediate fractions to certain customers, which are generated as part of our FDA-approved manufacturing process for IG and IVIG products, through a five-year manufacturing and supply agreement

we entered into in January 2020.

These intermediate by-products are used as the starting raw material to produce other plasma-derived biologics.

In addition, from time to time we provide contract manufacturing services for certain third-party

We also provide laboratory contracting services to certain customers and anticipate providing contract filling, labeling and packing services utilizing our FDA-approved in-house fill-finish capabilities.

ASCENIV is a plasma-derived IVIG that contains naturally occurring polyclonal antibodies, which are proteins that are used by the body’s immune system to neutralize microbes, such as bacteria and viruses, and prevent

against infection and disease.

We manufacture ASCENIV under HHS License No.

2019 using a process known as fractionation.

The Centers for Medicare and Medicaid Services (“CMS”) has issued a permanent, product-specific-J-code for ASCENIV.

Healthcare Common Procedure Coding System (“HCPCS”), the J-code (J1554) became effective April 1, 2021.

As part of our proprietary manufacturing process for ASCENIV, we leverage our unique, patented plasma donor screening methodology and tailored

plasma pooling design, which blends normal source plasma and plasma from donors tested to have high levels of neutralizing antibody titers to Respiratory Syncytial Virus (“RSV”) using our proprietary microneutralization testing assay.

patented testing methods and assay, we are able to identify the high-titer or “hyperimmune” plasma that meets our internal and required specifications for ASCENIV.

This type of high-titer plasma is typically found in less than 10% of the total

donor collection samples we test.

ASCENIV is approved for the treatment of PIDD or PI, a class of inherited genetic disorders that causes a deficient or absent immune system in adults and adolescents (12 to 17 years of age).

Our pivotal Phase 3

clinical trial in 59 PIDD patients met the primary endpoint of no Serious Bacterial Infections (“SBI”) reported during 12 months of treatment.

Secondary efficacy endpoints further demonstrated the benefits of ASCENIV in the low incidence of

infection, therapeutic antibiotic use, days missed from work, school and daycare and unscheduled medical visits and hospitalizations.

We believe this clinical data together with the FDA approval for the treatment of PIDD better positions ADMA to

potentially further evaluate ASCENIV in immune-compromised patients infected with or at-risk for RSV infection or potentially other respiratory viral pathogens at an appropriate time.

Due to the COVID-19 pandemic, our plans have been delayed.

the future however, we may elect to work with the FDA and the immunology and infectious disease community to design an appropriate clinical trial to evaluate the use of ASCENIV in this patient population.

Following FDA approval in April 2019,

commercial sales of ASCENIV commenced in October of 2019 and in 2023 ADMA commenced manufacturing ASCENIV at the 4,400 Liter production scale for the first time in the Company’s history.

We expect that this expansion should meaningfully improve the

product’s margin profile and increase plant production capacity as fewer batches will be needed to support our revenue goals.

ASCENIV’s prescriber and patient base continued to expand during 2023, which drove record utilization and pull-through for

this product.

These elevated demand trends have sustained into 2024, and ADMA currently expects that this product’s rapid growth will continue throughout 2024 and beyond.

BIVIGAM is a plasma-derived IVIG that contains a broad range of antibodies similar to those found in normal human plasma.

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estimates, these disorders are no longer considered to be very rare, with as many as one in every 1,200 people in the United States having some form of PI.

On May 9, 2019, the FDA approved the Prior Approval Supplement (the “PAS”) for the use of our IVIG manufacturing process, thereby enabling us to commence commercial sales of this product in the U.S.

On May 9, 2019, the FDA approved the Prior Approval Supplement (the “PAS”) for the use of our IVIG manufacturing process, thereby enabling us to re-launch and commercialize this product in the U.S.

production of BIVIGAM during the fourth quarter of 2017 and commercial production is ongoing, using our FDA-approved IVIG manufacturing process under U.S.

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increased IVIG plasma pool scale, which allows us to produce BIVIGAM at an expanded capacity utilizing the same equipment, release testing assays and labor force, has had a favorable impact on our gross margins, manufacturing efficiencies and

operating results since the beginning of the third quarter of 2021.

against infection and disease.

We manufacture ASCENIV under HHS License No.

2019 using a process known as fractionation.

The Centers for Medicare and Medicaid Services (“CMS”) has issued a permanent, product-specific-J-code for ASCENIV.

the Healthcare Common Procedure Coding System (“HCPCS”), the J-code (J1554) became effective April 1, 2021.

As part of our proprietary manufacturing process for ASCENIV, we leverage our unique, patented plasma donor screening methodology and

tailored plasma pooling design, which blends normal source plasma and plasma from donors tested to have high levels of neutralizing antibody titers to respiratory syncytial virus (“RSV”) using our proprietary microneutralization testing assay.

are able to identify the high titer or “hyperimmune” plasma that meets our internal and required specifications for ASCENIV with our patented testing methods and assay.

This type of high titer plasma is typically found in less than 10% of the

total donor collection samples we test.

ASCENIV is approved for the treatment of Primary Immune Deficiency Disorder (“PIDD”), a class of inherited genetic disorders that causes a deficient or absent immune system in adults and

adolescents (12 to 17 years of age).

Our pivotal Phase III clinical trial in 59 PIDD patients met the primary endpoint of no Serious Bacterial Infections (“SBI”) reported during 12 months of treatment.

Secondary efficacy endpoints further

demonstrated the benefits of ASCENIV in the low incidence of infection, therapeutic antibiotic use, days missed from work/school/daycare and unscheduled medical visits and hospitalizations.

We believe this clinical data together with the FDA

approval for the treatment of PIDD better positions ADMA to potentially further evaluate ASCENIV in immune-compromised patients infected with or at-risk for RSV infection or potentially other respiratory viral pathogens at an appropriate time.

Due to the COVID-19 pandemic, our plans have been delayed.

In the future however, we may work with the FDA and the immunology and infectious disease community to design an appropriate clinical trial to evaluate the use of ASCENIV in this

patient population.

Commercial sales of ASCENIV commenced in October of 2019 and our commercial and medical education efforts are focused on the labeled indication of patients with PIDD.

ASCENIV’s prescriber and patient base continued

to expand during the fourth quarter of 2022, which drove record utilization and pull-through for the product.

These elevated demand trends have sustained into 2023, and ADMA currently expects the product’s rapid growth will continue throughout

2023 and beyond.

operating results.

On December 12, 2023, we announced that the FDA approved the expansion of BIVIGAM’s label in the U.S.

to now include the pediatric setting for those two years of age and older.

Nabi-HB is a hyperimmune globulin that is rich in antibodies to the Hepatitis B virus.

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acute Hepatitis B virus infection in specific, listed settings.

Hepatitis B is a potentially life-threatening liver infection caused by the Hepatitis B virus.

It is a major global health problem.

It can cause chronic infection and places people

at high risk of death from cirrhosis and liver cancer.

Hepatitis B is a potentially life-threatening liver infection caused by the Hepatitis B virus, which is a major global health problem.

The Hepatitis B virus can cause chronic infection

and places people at high risk of death from cirrhosis and liver cancer.

Nabi-HB has a well-documented record of long-term safety and effectiveness since its initial market introduction.

The FDA approved Nabi-HB on March 24, 1999.

Production of Nabi-HB at the

Boca Facility has continued under our leadership since the third quarter of 2017.

Production of

Nabi-HB at the Boca Facility has continued under our leadership since the third quarter of 2017.

In early 2018, we received authorization from the FDA for the release of our first commercial batch of Nabi-HB for commercial distribution in the U.S.

continue to manufacture Nabi-HB under HHS License No.

IMPACT OF THE COVID-19 CRISIS

We continue to monitor the ongoing developments related to the COVID-19 pandemic, including the emergence of the Delta, Omicron and BA.2 variants and other resistant strains of the coronavirus, and its impacts to our

commercial and manufacturing operations and plasma collection facilities, including collections of source plasma, procurement of raw materials and packaging materials, a portion of which are sourced internationally, and the testing of finished

drug product that is required prior to its availability for commercial sale.

A substantial portion of such testing has historically been performed by contract laboratories outside the United States.

Due to a combination of previously mandated state and local “shelter-in-place” orders, as well as government stimulus packages, persisting social distancing measures and varying roll-outs of vaccinations by state, we

experienced lower than normal donor collections at our FDA approved plasma collection centers during 2021.

We are also subject to delays in shipments of source plasma from our contracted third-party suppliers, as well as delays in deliveries for

personal protective equipment, reagents and other non-plasma raw materials and supplies used in the manufacture and distribution of our products.

In addition, we are subject to supply chain delays as a result of certain of our suppliers diverting

significant resources towards the rapid development and distribution of COVID-19 vaccines and, as a result, we have elected to carry more raw materials inventory than we have in the past.

The COVID-19 pandemic previously impacted, to a certain

degree, our customer engagement initiatives, whereby ADMA’s sales and medical affairs field personnel faced difficulties communicating directly with physicians and other healthcare professionals, as well as the cancellation or postponement of a

number of key scientific and medical meetings, further limiting our ability to communicate with potential customers.

The pandemic could also impact our ability to interact with the FDA or other regulatory authorities and may result in delays in the conduct of inspections or review of pending applications or submissions.

received FDA approvals for four of our plasma collection centers during the year ended December 31, 2022, received several FDA approvals and two FDA inspections of the Boca Facility were completed during the year ended December 31, 2021, no

assurances can be provided as to the timing for completion of any future regulatory submissions or applications that may be impacted by restrictions related to COVID-19.

During the years ended December 31, 2022 and 2021, our revenue attributable to international customers was approximately 5% and 13%, respectively, of our total revenues.

As we seek to grow this aspect of our

business, we may also be subject to the impacts of the COVID-19 pandemic in locations outside the United States.

Notwithstanding the foregoing, the COVID-19 pandemic to date has not had a material impact on our financial condition or results of operations, and we do not believe that our production operations at the Boca

Facility, our contract fill/finishers or our plasma collection facilities have been significantly impacted by the COVID-19 pandemic.

As a result, we do not anticipate and have not experienced any material impairments with respect to any of our

long-lived assets, including our property and equipment, goodwill or intangible assets.

Although the COVID-19 pandemic has not, to date, materially adversely impacted our capital and financial resources, because we are unable to determine the ultimate severity or duration of the pandemic or its

long-term effects on, among other things, the global, national or local economies, the capital and credit markets or our workforce, customers or suppliers, at this time we are unable to predict whether COVID-19, or any known or future variant or

government order, will have a material adverse impact on our business, financial condition, liquidity and results of operations.

After the COVID-19 global pandemic has settled, we may continue to experience adverse impacts to our business as a

result of evolving macroeconomic factors, including general economic uncertainty, unemployment rates, inflationary pressures and any actual economic recession that has occurred or may occur in the future.

and we continue to manufacture Nabi-HB under HHS License No.

IT SYSTEMS DISRUPTION

On June 19, 2023, we experienced an IT systems disruption, which rendered certain of our IT systems inaccessible for less than one week.

Our investigation of the disruption has been completed with the assistance of

third-party consultants.

While no definitive root cause was identified, as previously disclosed we believe that this IT systems disruption may have been caused by a third-party who may have gained access to the system.

There was no original

financial systems or other data loss or any evidence of files exfiltrated due to this disruption.

Normal operations have resumed across our business units.

At the time of the disruption, we were in production of two batches of BIVIGAM, and after a

prolonged hold time, it was deemed to be a prudent GMP quality decision to discard these two in-process production batches as these batches were no longer viable for further production or had any alternative use.

As a result, we recorded a

one-time, non-recurring charge of $2.1 million for this inventory in the second quarter of 2023, which is reflected in Cost of product revenue in the accompanying consolidated statements of operations for the year ended December 31, 2023.

addition, the Company’s Plasma center operating expenses were adversely impacted by approximately $0.7 million due to the temporary closing of our plasma collection centers while their IT systems were restored.

We carry appropriate insurance for these types of instances, and while there can be no assurances ADMA will be reimbursed for the insurance claims made pertaining to these charges, we are actively working with our

insurance broker and carriers.

RESULTS OF OPERATIONS

Critical Accounting Policies and Estimates

This Management’s Discussion and Analysis of Financial Condition and Results of Operations is based on our consolidated financial statements, which have been prepared in accordance with Accounting Principles

Generally Accepted in the United States of America (“U.S.

The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and

On an ongoing basis, we evaluate these estimates and assumptions, including those described below.

We base our estimates on our historical experience and on various other assumptions that we believe to be reasonable under the

circumstances.

These estimates and assumptions form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

Actual results and experiences may differ materially from

these estimates.

Significant estimates include rebates and certain other deductions from gross revenues, the realizable value of accounts receivable, valuation of inventory, impairment of long-lived assets, assumptions used in projecting future

liquidity and capital requirements, assumptions used in the fair value of awards granted under our equity incentive plans and warrants issued in connection with the issuance of notes payable and the valuation allowance for our deferred tax

Accepted in the United States of America (“U.S.

The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses.

ongoing basis, we evaluate these estimates and assumptions, including those described below.

We base our estimates on our historical experience and on various other assumptions that we believe to be reasonable under the circumstances.

estimates and assumptions form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

Actual results and experiences may differ materially from these estimates.

Significant estimates include rebates and certain other deductions from gross revenues, impairment of long-lived assets, valuation of inventory, assumptions used in projecting future liquidity and capital requirements, assumptions used in the fair

value of awards granted under our equity incentive plans and warrants issued in connection with the issuance of notes payable and the valuation allowance for our deferred tax assets.

Some of the estimates and assumptions we have to make under U.S.

GAAP require difficult, subjective and/or complex judgments about matters that are inherently uncertain and, as a result, actual results could differ

from those estimates.

Due to the estimation processes involved, the following summary of accounting estimates and their application are considered to be critical to understanding our business operations, financial condition and results of

GAAP require difficult, subjective or complex judgments about matters that are inherently uncertain and, as a result, actual results could differ from

those estimates.

For a description of our significant accounting policies, see Note 2 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K.

Estimates and assumptions used in projecting future liquidity and

capital requirements are described in Note 1 to the Consolidated Financial Statements.

Estimates and assumptions used in projecting future liquidity and capital

requirements are described in Note 1 to the Consolidated Financial Statements.

Our gross product revenues are subject to a variety of deductions, which are estimated and recorded in the same period that the revenues are recognized.

These deductions primarily consist of rebates, distribution

fees, chargebacks and sales allowances.

These deductions represent estimates of the related obligations, some of which are contractual in nature and do not require extensive judgment to be exercised by management, while other estimates require

complex or subjective matters of knowledge and judgment when estimating the impact of these revenue deductions on net revenues for a reporting period.

These deductions primarily consist of rebates, distribution fees,

chargebacks and sales allowances.

subjective matters of knowledge and judgment when estimating the impact of these revenue deductions on net revenues for a reporting period.

Historically, adjustments to these estimates to reflect actual results or updated expectations have not been material to our overall business.

However, two of our primary immunoglobulin products, ASCENIV and

BIVIGAM, were only approved for commercial sale by the FDA in 2019, and as such our historical experience with rebates with respect to these products is limited.

If any of our ratios, factors, assessments, experiences or judgments are not

indicative or accurate estimates of our future experience, our results could be materially affected.

While we have some historical sales and rebate experience from our two

primary immunoglobulin products, ASCENIV and BIVIGAM, since their FDA approvals in 2019, it is not extensive.

If any of our ratios, factors, assessments, experiences or judgments are not indicative or accurate estimates of our future experience,

our results could be materially affected.

Estimates that are most at risk for material adjustment are those associated with U.S.

Medicaid rebates because of the extensive time delay

between the recording of the accrual and its ultimate settlement, an interval that can generally take up to several years or more.

While our results of operations to date have not required any material adjustment due to this risk, the delay

between when this obligation is initially recorded and ultimately settled could potentially materially impact our revenues and our results of operations in the future.

Medicaid rebates because of the extensive time delay between the recording of the accrual and its ultimate settlement,

an interval that can generally take up to several years or more.

These estimates may change from time to time based on changes in utilization, payor and channel mixes.

While our results of operations to date have not required any material

adjustment due to this risk, the delay between when this obligation is initially recorded and ultimately settled could potentially materially impact our revenues and our results of operations in the future.

Valuation of Inventory

Estimates related to the valuation of inventory include net realizable value of inventory in determining whether the cost of inventory exceeds its net realizable value which, if this were the case, would require a

charge against earnings to write down the value of the inventory to its net realizable value.

Net realizable value of inventory is based on our management’s estimate of the future net selling price of the inventory, which is subject to market

conditions and the estimation processes we use for revenues as discussed above.

With respect to raw materials inventory, we are required to estimate the level and timing of usage of these materials prior to their expiration dates in determining

whether it is appropriate to carry these materials on our balance sheet as a valid asset of the Company.

Changes in either of these estimates could potentially materially impact our cost of product revenue and results of operations.

Stock-Based Compensation and Valuation of Warrants

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Any changes in

the foregoing Black-Scholes assumptions, or an election by us to utilize an alternative method for valuing stock options granted to employees, directors and officers, could potentially impact our stock-based compensation expense and our results

of operations.

We also use the Black-Scholes option pricing model for the purpose of estimating the fair value of warrants we issue from time to time in connection with the issuance of notes payable.

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Impairment of Long-Lived Assets

We assess the recoverability of our long-lived assets, which include property and equipment and definite-lived intangible assets, whenever significant events or changes in circumstances indicate impairment may have

We assess the recoverability of our long-lived assets, which include property and equipment and finite-lived intangible assets, whenever significant events or changes in circumstances indicate impairment may have

If indicators of impairment exist, projected future undiscounted cash flows associated with the asset are compared to its carrying amount to determine whether the asset’s carrying value is recoverable.

Any resulting impairment is

recorded as a reduction in the carrying value of the related asset in excess of fair value and a charge to operating results.

Any resulting impairment is recorded

as a reduction in the carrying value of the related asset in excess of fair value and a charge to operating results.

For the years ended December 31, 2023 and 2022, we determined that there was no impairment of our long-lived assets.

Examples of events or circumstances that may be indicative of impairment that would require the use of significant judgment by management include:

events or circumstances that may be indicative of impairment that would require the use of significant judgment by management include:

A significant adverse change in legal factors or in the business climate that could affect the value of the asset.

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An expectation of losses or reduced profits associated with an asset.

This could result, for example, from the introduction of a competitor’s product that impacts projected revenue growth, or a change in the acceptance of a product

by patients, physicians and payers that results in an inability to sustain projected product revenues.

This could result, for example, from the introduction of a competitor’s product that impacts projected revenue growth, or a change in the acceptance of a product by

patients, physicians and payers that results in an inability to sustain projected product revenues.

Goodwill is not amortized but is assessed for impairment on an annual basis or more frequently if impairment indicators exist.

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market capitalization.

Determination of the fair value and carrying value of each reporting unit, relative to the fair value of the Company, requires management to employ certain estimates, assumptions and judgment, which we believe are

However, any changes to these estimates and assumptions could impact our determination of whether or not our goodwill is impaired.

We did not recognize any impairment charges related to goodwill for the years ended December 31, 2022

We did not recognize any impairment charges related to goodwill for the years ended December 31, 2023, 2022 and 2021.

Deferred Tax Assets

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source of income to recognize our deferred tax assets.

Year Ended December 31, 2023 Compared to Year Ended December 31, 2022

The following table presents a summary of the changes in our results of operations for the year ended December 31, 2023, compared to the year ended December 31, 2022:

Year Ended December 31,

(in thousands)

Increase (Decrease)

Cost of product revenue

Research and development expenses

Plasma center operating expenses

Amortization of intangibles

Selling, general and administrative expenses

Income (loss) from operations

Interest expense

Loss on extinguishment of debt

Other income (expense), net

Adjusted EBITDA *

Adjusted net income (loss) *

- See Non-GAAP Financial Measures appearing at the end of this discussion

We recorded total revenues of $258.2 million for the year ended December 31, 2023, as compared to $154.1 million for the year ended December 31, 2022, an increase of $104.1 million, or approximately 68%.

is primarily related to increased sales of our immunoglobulin products, mainly ASCENIV and BIVIGAM, generated by our Boca Facility manufacturing operations in 2023 of $105.8 million, as we continue to experience increased physician, payer and

patient acceptance and utilization of ASCENIV and expand our customer base for BIVIGAM, partially offset by a decrease in sales of plasma in our Plasma Collection Centers business segment of $1.5 million.

During 2023, we began utilizing a

substantial majority of the plasma collected at our plasma collection facilities for our IVIG production, with significantly less emphasis on plasma sales to third-party customers.

Cost of Product Revenue and Gross Profit

Cost of product revenue was $169.3 million for the year ended December 31, 2023, as compared to $118.8 million for the year ended December 31, 2022.

This increase is primarily attributable to volume-driven increases

in product revenue costs related to the increased sales of our immunoglobulin products of $54.9 million.

Cost of product revenue was also impacted by the inventory losses of $2.1 million related to the June 2023 IT disruption, partially offset by

a decrease in other manufacturing expenses of approximately $6.2 million in 2023, mainly due to a shorter planned shutdown of the Boca Facility in 2023 as compared to 2022.

For the year ended December 31, 2023, we had gross profit of $88.9 million, as compared to $35.3 million for the same period of a year ago.

This gross profit increase of $53.7 million was primarily due to the revenue

increases and the supply chain and manufacturing enhancements at the Boca Facility which include producing at the increased 4,400 liter scale, along with the reduction in other manufacturing costs discussed above as we elected to extend our

otherwise-routine plant shutdown in the first quarter of 2022 in order to complete certain projects.

We also experienced a more favorable sales mix in 2023 toward our higher margin products and benefitted from price increases for ASCENIV and

BIVIGAM that were implemented late in 2022.

As a result, we achieved a gross margin of 34.4% for the year ended December 31, 2023 as compared to 22.9% for the year ended December 31, 2022.

Research and Development Expenses

Research and development (“R&D”) expenses totaled $3.3 million for the year ended December 31, 2023, as compared to $3.6 million for the year ended December 31, 2022.

The decrease is primarily due to lower

expenditures attributable to a third-party service provider in connection with an R&D project that was completed in early 2023.

Plasma Center Operating Expenses

Plasma Center Operating Expenses decreased from $17.8 million in the year ended December 31, 2022 to $4.3 million in the year ended December 31, 2023.

As a result of our now having ten plasma centers in operation, we

were able to more than double the number of liters of plasma collected, with a corresponding reduction in the cost per liter, in 2023 as compared to 2022, coupled with the changes in the market price of normal source plasma and its impact on the

net realizable value of our plasma inventory, the amount of plasma center costs we capitalized into inventory increased by approximately $43.2 million in 2023.

This amount was largely offset by increases in donor fees of $12.8 million,

compensation, benefits and temporary labor of $3.9 million, softgoods and supplies of $5.0 million, donor testing expenses of $4.8 million, depreciation of $0.8 million, software maintenance expense of $0.9 million, janitorial, security and

utilities expense of $0.5 million, travel expenses of $0.1 million, advertising expense of $0.2 million, repairs and maintenance expense of $0.2 million and rent of $0.2 million.

In addition, our plasma center collections and operating costs were

unfavorably impacted by approximately $0.7 million due to the temporary closing of our plasma collection centers attributable to an IT disruption occurring in June 2023, of which all systems have since been fully restored.

Amortization of Intangibles

Amortization expense mainly pertains to the amortization of intangible assets acquired in a 2017 acquisition transaction and was $0.7 million for the years ended December 31, 2023 and 2022.

Selling, General and Administrative Expenses

Selling, general and administrative (“SG&A”) expenses were $59.0 million for the year ended December 31, 2023, an increase of $6.6 million from the year ended December 31, 2022.

The increase reflects higher

expenses for employee-related costs including salaries, benefits, stock-based compensation, travel, relocation and recruiting of $2.4 million, data services and market intelligence fees in support of the continued ASCENIV and BIVIGAM

commercialization efforts in the amount of $1.8 million, marketing and advertising expenses of $1.0 million, insurance expense of $0.6 million, software maintenance expense of $0.6 million and state and local taxes of $0.2 million.

Income/Loss from Operations

For the year ended December 31, 2023, we had operating income of $21.6 million, as compared to an operating loss of $39.4 million for the year ended December 31, 2022.

The $61.0 million improvement in operating results

was mainly due to the improved gross profit of $53.7 million and the lower total operating expenses of $7.3 million.

Interest Expense

Interest expense for the year ended December 31, 2023 was $25.0 million, as compared to $19.3 million for the year ended December 31, 2022.

The increase is mainly due to approximately $51.8 million of additional debt

principal resulting from the refinancing of our senior credit facility on March 23, 2022, additional debt principal resulting from interest payments made “in kind” in the form of additional indebtedness of approximately $6.8 million, as well as an

increase in the stated interest rate on our senior debt from 10.75% in 2022 to as high as 14.4% at certain points in fiscal 2023 as a result increases in the Secured Overnight Financing Rate (“SOFR”).

We expect our interest expense to decrease in

2024 as a result of the refinancing transaction we completed in December of 2023 (see “Liquidity and Capital Resources”), which resulted in a lower debt principal balance and a reduction in the interest rate.

Loss on Extinguishment of Debt

In connection with the foregoing refinancing of our senior debt in December of 2023, we incurred a loss on extinguishment of debt in the amount of $26.2 million, which is comprised of a prepayment penalty paid to our

previous lender in the amount of $11.1 million, and the write-off of unamortized discount related to the retired indebtedness in the approximate amount of $15.1 million (see “Liquidity and Capital Resources”).

In connection with the refinancing of our senior credit facility on March 23, 2022, we incurred a loss on the extinguishment of debt in the amount of $6.7 million as a result of the redemption premium we paid to retire

our previously existing credit facility in the amount of $2.0 million, and the write-off of unamortized debt discount of $4.7 million related to that facility (see Note 7 to the Consolidated Financial Statements).

Other Income (Expense), Net

Other income, net, for the year ended December 31, 2023 was $1.3 million, as compared to other expense, net, of $0.6 million for the year ended December 31, 2022.

The increase is mainly due to an increase in interest

income of approximately $1.6 million in 2023 due to higher interest earned on our cash balances in 2023.

Our net loss was $28.2 million for the year ended December 31, 2023, as compared to $65.9 million for the year ended December 31, 2022.

The $37.7 million decrease in net loss was mainly due to the improvement in

operating income/loss of $61.0 million and the $1.9 million increase in other income/expense, partially offset by a higher loss on extinguishment of debt of $19.5 million and higher interest expense of $5.7 million.

Year Ended December 31, 2022 Compared to December 31, 2021

1 unchanged sentence

Year Ended December 31,

(in thousands)

Increase (Decrease)

Cost of product revenue

7 unchanged sentences

Other expense, net

Adjusted EBITDA *

Adjusted net loss *

- See Non-GAAP Financial Measures appearing at the end of this discussion

We recorded total revenues of $154.1 million during the year ended December 31, 2022, as compared to $80.9 million during the year ended December 31, 2021, an increase of $73.1 million, or approximately 90%.

increase is mainly due to increased sales of our immunoglobulin products and intermediate fractions generated by our Boca Facility manufacturing operations in 2022 totaling $69.2 million as we conclude our third full year of commercial sales of

BIVIGAM and ASCENIV.

We attribute this increase in revenue to the continued expansion of our customer base in 2022 and to increasing physician, payer and patient acceptance of both BIVIGAM and ASCENIV.

We also experienced a $4.0 million increase

in plasma revenues generated by our Plasma Collection Centers business segment due to increased sales of plasma through spot market opportunities beyond our long-term supply agreement.

We also experienced a $4.0 million increase in

plasma revenues generated by our Plasma Collection Centers business segment due to increased sales of plasma through spot market opportunities beyond our long-term supply agreement.

Cost of Product Revenue and Gross Profit

2 unchanged sentences

volume-related increases in product revenue costs related to the sale of our immunoglobulin products of $30.4 million and increased product revenue costs related to our ADMA BioCenters business segment in the amount of $4.3 million.

we also experienced an increase in other manufacturing expenses of approximately $4.4 million in fiscal 2022 as compared to fiscal 2021, which is indicative of certain inflationary pressures being experienced by our industry for labor,

materials, freight, fuel surcharges and third-party services.

Our gross profit of $35.3 million for the year ended December 31, 2022 represents an improvement over the same period of a year ago of $34.1 million and is mainly due to the higher sales volume, the improved margins

we are experiencing with BIVIGAM at the larger plasma pool production scale, and to the increased relative contribution of ASCENIV to our total revenues.

In addition, we

also experienced an increase in other manufacturing expenses of approximately $4.4 million in fiscal 2022 as compared to fiscal 2021, which is indicative of certain inflationary pressures being experienced by our industry for labor, materials,

freight, fuel surcharges and third-party services.

are experiencing with BIVIGAM at the larger plasma pool production scale, and to the increased relative contribution of ASCENIV to our total revenues.

As a result, we achieved a gross margin of 22.9% for the year ended December 31, 2022, as

1 unchanged sentence

Subsequent to the FDA approvals for BIVIGAM and ASCENIV received in 2019 through December 31, 2022, substantially all of the normal source plasma (“NSP”) used in our Boca Facility IG production was sourced under a

supply agreement we had in place with Grifols Worldwide Operations Limited, the successor-in-interest to BPC (“Grifols”).

supply agreement we had in place with Grifols Worldwide Operations Limited (“Grifols”).

This agreement expired on December 31, 2022 and was not renewed.

Although we have executed additional agreements with other

third-party suppliers of NSP, we anticipate that a substantial portion of the NSP used in IG production in 2023 and beyond will be sourced from our ADMA BioCenters plasma collection facilities.

As a number of these facilities are still in their

initial stages of operation, we expect that the cost of collecting NSP at many of these facilities will exceed the price per liter of NSP we were paying to Grifols and other third-party suppliers.

As a result, we expect the production costs for

our immune globulin products to increase in the near term, which could adversely impact our cost of product revenue and gross margins, without giving effect to other supply chain initiatives completed and anticipated manufacturing efficiencies

expected in the future.

Although we have executed additional agreements with other third-party suppliers of NSP, we

anticipate that the NSP used in IG production in 2023 and beyond will be sourced from our ADMA BioCenters plasma collection facilities.

As a number of these facilities are still in their initial stages of operation, we expect that the cost of

collecting NSP at many of these facilities will exceed the price per liter of NSP we were paying to Grifols and other third-party suppliers.

As a result, we expect the production costs for our immune globulin products to increase in the near term,

which could adversely impact our cost of product revenue and gross margins, without giving effect to other supply chain initiatives completed and anticipated manufacturing efficiencies expected in the future.

Research and Development Expenses

Research and development expenses (“R&D”) of $3.6 million for the year ended December 31, 2022 was essentially unchanged from the year ended December 31, 2021, as the lower compensation costs (including

stock-based compensation) in 2022 resulting from the 2021 resignation of our former Chief Medical and Chief Scientific Officer was offset by increased expenses associated with post-marketing commitment clinical

studies for ASCENIV and BIVIGAM (see Note 10 to the Consolidated Financial Statements) .

R&D expenses of $3.6 million for the year ended December 31, 2022 was essentially unchanged from the year ended December 31, 2021, as the lower compensation costs (including stock-based compensation) in 2022

resulting from the 2021 resignation of our former Chief Medical and Chief Scientific Officer were offset by increased expenses associated with post-marketing commitment clinical studies for ASCENIV and BIVIGAM (see Note 10 to the Consolidated

Financial Statements).

Plasma Center Operating Expenses

9 unchanged sentences

mainly attributable to increases in donor fees, some of which are specialty programs and promotions by the newly opened centers, of $10.7 million, employee compensation costs of $5.8 million, softgoods and supplies of $3.8 million, depreciation

expense of $1.1 million, rent expense of $0.5 million, plasma testing expenses of $2.8 million, travel expense of $0.2 million, software maintenance expense of $0.4 million, janitorial and utilities expense of $0.5 million, professional services

of $0.4 million, postage and freight of $0.3 million and advertising expenses of $0.3 million.

These amounts were partially offset by a substantial increase in plasma collections which resulted in a reduction in our plasma center operating

expenses by approximately $21.4 million.

$0.4 million, postage and freight of $0.3 million and advertising expenses of $0.3 million.

These amounts were partially offset by a substantial increase in plasma collections which resulted in a reduction in our plasma center operating expenses by

approximately $21.4 million.

Selling, General and Administrative Expenses

Selling, general and administrative expenses (“SG&A”) were $52.5 million for the year ended December 31, 2022, an increase of $9.6 million from the year ended December 31, 2021.

As we continued to support the

increase in the size and scope of our Boca Facility manufacturing and commercial operations in 2022, we experienced increases in employee compensation and related expenses, including travel, relocation and recruiting, of $4.6 million, $1.8

million of which is stock-based compensation.

We also experienced increases in insurance expense of $1.4 million and utilities of $0.5 million in 2022, as well as an increase in data services and market intelligence fees in the amount of $1.5

million in support of the commercialization efforts for BIVIGAM and ASCENIV.

In addition, we incurred professional fees in connection with the Morgan Stanley strategic alternatives process in the amount of $1.4 million, with no comparable amount

SG&A expenses were $52.5 million for the year ended December 31, 2022, an increase of $9.6 million from the year ended December 31, 2021.

As we continued to support the increase in the size and scope of our Boca

Facility manufacturing and commercial operations in 2022, we experienced increases in employee compensation and related expenses, including travel, relocation and recruiting, of $4.6 million, $1.8 million of which is stock-based compensation.

also experienced increases in insurance expense of $1.4 million and utilities of $0.5 million in 2022, as well as an increase in data services and market intelligence fees in the amount of $1.5 million in support of the commercialization efforts

for BIVIGAM and ASCENIV.

In addition, we incurred professional fees in connection with the Morgan Stanley strategic alternatives process in the amount of $1.4 million, with no comparable amount in 2021.

Amortization of Intangibles

Amortization expense for intangible assets acquired in the Biotest Transaction was $0.7 million for the years ended December 31, 2022 and 2021.

Amortization expense for intangible assets acquired in an acquisition transaction was $0.7 million for the years ended December 31, 2022 and 2021.

Loss from Operations

Our operating loss was $39.4 million for the year ended December 31, 2022, as compared to $58.4 million for the year ended December 31, 2021.

The decrease in operating loss was mainly due to the improved gross

profit for the year ended December 31, 2022 of $34.1 million, partially offset by the increases in plasma center operating expenses and SG&A.

The decrease in operating loss was mainly due to the improved gross profit

for the year ended December 31, 2022 of $34.1 million, partially offset by the increases in plasma center operating expenses and SG&A.

Interest Expense

Interest expense was $19.3 million for the year ended December 31, 2022, as compared to $13.1 million for the year ended December 31, 2021.

The increase reflects the additional indebtedness and increase in

amortization of debt discount resulting from the refinancing of our senior credit facility on March 23, 2022 (see “Liquidity and Capital Resources”).

The refinancing transaction resulted in additional indebtedness at closing in the approximate

amount of $51.8 million, and our debt principal increased by an additional $3.0 million subsequent to closing as our new senior credit facility allows us to pay “in kind” a portion of our monthly interest obligation in the form of additional

indebtedness to the lender.

The increase reflects the additional indebtedness and increase in amortization

of debt discount resulting from the refinancing of our senior credit facility on March 23, 2022.

The refinancing transaction resulted in additional indebtedness at closing in the approximate amount of $51.8 million, and our debt principal increased

by an additional $3.0 million subsequent to closing as the Hayfin Credit Agreement (see “Liquidity and Capital Resources”) allowed us to pay “in kind” a portion of our monthly interest obligation in the form of additional indebtedness to the

We expect to continue to pay a portion of our monthly interest obligation “in kind” during 2023.

As a result, and given the expected continued rise in global interest rates, we expect our principal debt balance and the

associated interest expense to increase over the course of fiscal 2023 as compared to previous years.

As a result, and given the expected continued rise in SOFR, we expect our principal debt balance and the associated interest expense to

increase over the course of fiscal 2023 as compared to previous years.

Loss on Extinguishment of Debt

retire our previously existing credit facility in the amount of $2.0 million, and the write-off of unamortized debt discount of $4.7 million related to that facility (see Note 7 to the Consolidated Financial Statements).

Our net loss was $65.9 million for the year ended December 31, 2022, as compared to $71.6 million for the year ended December 31, 2021.

1 unchanged sentence

operating loss, largely offset by the higher interest expense and loss on extinguishment of debt in 2022.

Non-GAAP Financial Measures

Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”), Adjusted EBITDA and Adjusted Net Income (Loss)

EBITDA, Adjusted EBITDA and Adjusted net income (loss) are important non-GAAP financial measures used by our management and Board of Directors to assess our operating performance.

We use EBITDA, Adjusted EBITDA and

Adjusted net income (loss) as key performance measures because we believe that they facilitate operating performance comparisons from period to period that exclude, in the case of Adjusted net income (loss), items that are expected to be

non-recurring, and in the case of EBITDA and Adjusted EBITDA, potential differences driven by the impact of variations of non-cash items such as depreciation and amortization, as well as, in the case of Adjusted EBITDA, stock-based compensation or

certain one-time and non-recurring items.

In addition, we believe that EBITDA, Adjusted EBITDA and Adjusted net loss and similar measures are widely used by investors, securities analysts, ratings agencies and other parties in evaluating companies

in our industry as a measure of financial performance and debt-service capabilities.

See below for a reconciliation of our EBITDA, Adjusted EBITDA and Adjusted net income (loss) to net loss, the most directly comparable financial measure calculated

and presented in accordance with U.S.

Because EBITDA, Adjusted EBITDA and Adjusted net income (loss) are measures not deemed to be in accordance with U.S.

GAAP and are susceptible to varying calculations, our EBITDA, Adjusted EBITDA and Adjusted net income

(loss) may not be comparable to similarly titled measures of other companies, including companies in our industry, because other companies may calculate EBITDA, Adjusted EBITDA and Adjusted net income (loss) in a different manner than we calculate

these measurements.

Although the Company uses Adjusted EBITDA as one of several financial measures to assess its operating performance, its use is limited as it excludes certain significant operating expenses.

EBITDA, Adjusted EBITDA and Adjusted

net income (loss) are not intended to represent cash flows for the periods presented, nor have they been presented as an alternative to operating income/loss, net income/loss or as an indicator of operating performance and should not be considered

in isolation or as a substitute for measures of performance prepared in accordance with U.S.

The following table presents the reconciliation of net loss to EBITDA and Adjusted EBITDA for the years ended December 31, 2023, 2022 and 2021:

Years Ended December 31,

(in thousands)

Interest expense

Stock-based compensation

IT systems disruption

Loss on extinguishment of debt

Adjusted EBITDA

Adjusted EBITDA increased by $67.9 million for the year ended December 31, 2023 as compared to the same period of a year ago.

The improvement is driven primarily by an increase in operating income in 2023 of $61.0

Adjusted EBITDA improved by $22.0 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021, mainly due to the decreasing in operating loss in 2022 of $19.0 million.

The following table presents the reconciliation of Net loss to Adjusted net income (loss) for the years ended December 31, 2023, 2022 and 2021:

Years Ended December 31,

(in thousands)

Loss on extinguishment of debt

IT systems disruption

Adjusted net income (loss)

LIQUIDITY AND CAPITAL RESOURCES

At December 31, 2022, we had working capital of $231.1 million, primarily consisting of $163.3 million of inventory, cash and cash equivalents of $86.5 million and accounts receivable of $15.5 million, partially

offset by current liabilities of $39.3 million, as compared to working capital at December 31, 2021 of $178.4 million, primarily consisting of $124.7 million of inventory, cash and cash equivalents of $51.1 million and accounts receivable of

$28.6 million, partially offset by $30.4 million of current liabilities.

We have incurred an accumulated deficit of $478.0 million since inception and had negative cash flows from operations of $59.5 million and $112.4 million for the years ended

December 31, 2022 and 2021, respectively.

We have funded our operations over the past few years primarily from the sale of our equity and debt securities.

At December 31, 2023, we had working capital of $207.2 million, primarily consisting of $172.9 million of inventory, cash and cash equivalents of $51.4 million and $27.4 million of accounts receivable, partially offset

by current liabilities of $49.8 million, as compared to working capital at December 31, 2022 of $231.1 million, primarily consisting of $163.3 million of inventory, cash and cash equivalents of $86.5 million and accounts receivable of $15.5

million, partially offset by current liabilities of $39.3 million.

We have incurred an accumulated deficit of $506.3 million since inception and although we had positive cash flow from operations of $8.8 million for the year ended December 31,

2023, we had negative cash flows from operations of $59.5 million and $112.4 million for the years ended December 31, 2022 and 2021, respectively.

We have funded our operations over the past few years primarily from the sale of our equity

securities and debt financings.

Our material cash requirements are primarily comprised of:

The procurement of raw material plasma and other raw materials necessary to maintain and scale up our manufacturing operations;

The collection and procurement of raw material source plasma, which includes plasma donor fees and plasma center supplies, and other raw materials necessary to maintain and scale up our manufacturing operations;

Employee compensation and benefits;

Capital expenditures to complete the buildout for and maintain our plasma collection facilities and for equipment upgrades and capacity expansion at the Boca Facility;

Plasma donor fees and plasma center supplies;

Capital expenditures for equipment upgrades and capacity expansion at the Boca Facility and to maintain our plasma collection facilities;

Interest on our debt;

Marketing programs and continued commercialization efforts;

Marketing programs, medical education and continued commercialization efforts;

Boca Facility maintenance, repairs and supplies;

Conducting required post-marketing clinical trials for our FDA-approved products;

Continuous improvements and updates to our IT infrastructure, laboratory equipment and assays, and facilities and engineering equipment.

In addition, our end-to-end production cycle time from procurement of raw materials to commercial release of finished product can take between seven and 12 months or potentially longer, requiring substantial inventories of raw material plasma

and other manufacturing materials and single use disposables.

We expect that we will not be able to generate a sufficient amount of product revenue to achieve profitability until the beginning of 2024.

We currently anticipate, based upon our projected revenue and expenditures,

that our current cash, cash equivalents and accounts receivable will be sufficient to fund our operations, as currently conducted, through the end of the first quarter of 2024, at which time we believe we will begin to generate positive cash flow

from operations.

This time frame may change based on several factors, including the success of our commercial efforts with respect to the sale of our products and the acceptability of our immune globulin products by physicians, patients or

payers, and whether or not the assumptions underlying our projected revenues and expenses are correct.

If we are unable to achieve positive cash flow by the beginning of 2024, we may need to raise additional capital and if such capital is not

available due to widespread liquidity constraints or significant market instability that could result from the COVID-19 pandemic, inflationary pressures or other factors beyond our control, we may have to delay, curtail or eliminate some of our

commercialization efforts or product development activities.

If we are unable to generate sufficient revenue to achieve positive cash flow by the beginning of 2024 and need to raise additional capital, we may decide to do so through public or

private equity offerings or debt financings, or we may enter into a corporate collaboration or licensing arrangement.

The sale of additional or equity debt securities, if convertible, could result in dilution to our stockholders and, in such

event, the value and potential future market price of our common stock may decline.

ADMA continues to evaluate a variety of strategic alternatives through its ongoing engagement with Morgan Stanley.

The exploration of value-creating opportunities remains a top corporate priority for ADMA.

On March 23, 2022, (the “Hayfin Closing Date”) we and all of our subsidiaries entered into a Credit and Guaranty Agreement (the “Hayfin Credit Agreement”) with Hayfin Services LLP (“Hayfin”).

Hayfin Credit Agreement, as amended, provides for a senior secured term loan facility in a principal amount of up to $175.0 million (the “Hayfin Credit Facility”), composed of (i) a term loan made on the Hayfin Closing Date in the principal

amount of $150.0 million (the “Hayfin Closing Date Loan”), and (ii) a delayed draw term loan in the principal amount of $25.0 million (the “Hayfin Delayed Draw Loan” and, together with the Hayfin Closing Date Loan, the “Hayfin Loans”).

to an amendment to the Hayfin Credit Agreement dated March 22, 2023, the obligation of the lenders to make the Hayfin Delayed Draw Loan expires on June 30, 2023.

The obligation of the lenders to make the Hayfin Delayed Draw Loan is subject to the

satisfaction of certain conditions, including, but not limited to, our meeting certain 12-month revenue targets as set forth in the Hayfin Credit Agreement which have been met.

The Hayfin Credit Facility has a maturity date of March 23, 2027 (the

“Hayfin Maturity Date”), subject to acceleration pursuant to the Hayfin Credit Agreement, including upon an Event of Default (as defined in the Hayfin Credit Agreement).

On the Hayfin Closing Date, we used $100.0 million of the Hayfin Closing Date Loan to terminate and pay in full all of the outstanding obligations under our previous senior credit facility with

Perceptive (see Note 7 to the Consolidated Financial Statements).

We also used $2.0 million of the Hayfin Closing Date Loan proceeds to pay a redemption premium to Perceptive and used approximately $1.0 million of the Hayfin Closing Date Loan

proceeds to pay certain fees and expenses incurred in connection with this transaction.

In addition, a $1.8 million upfront fee payable to Hayfin was paid “in kind” and was added to the outstanding principal balance in accordance with the terms

of the Hayfin Credit Agreement.

The remainder of the proceeds received or to be received from the Hayfin Loans will be used for working capital and other general corporate purposes.

Borrowings under the Hayfin Credit Agreement currently bear interest at the adjusted Term Secured Overnight Financing Rate (“SOFR”) for either a one-month or three-month tenor, as elected by us, and

subject to a floor of 1.25%, plus an applicable margin of 9.5% (the “Applicable Margin”);

provided, however, that upon, and during the continuance of, an Event of Default, the Applicable Margin shall increase by an additional 3% per annum.

will also pay “in kind” a portion of the interest on the Hayfin Loans for each monthly or quarterly interest period in an amount equal to 2.5% per annum.

Such interest paid “in kind” will reduce our quarterly cash interest obligation by

approximately $1.0 million and will be added to the principal amount of the outstanding debt under the Hayfin Credit Facility.

As a result, our outstanding debt principal on the Hayfin Loans will increase each month as long as we elect to

continue to pay a portion of our interest obligation “in kind.” On the Hayfin Closing Date and as of December 31, 2022, the stated interest rate on the Hayfin Loans interest rate was 10.75% and approximately 13.9%, respectively.

interest rate in effect as of the date of this report, on the last day of each calendar month or quarter during the term of the Hayfin Credit Facility, we are required to pay accrued interest to Hayfin of approximately $1.6 million per month or

approximately $4.7 million per quarter, after giving effect to the “in kind” interest of 2.5% per annum, but without giving effect to the Hayfin Delayed Draw Loan, which we have yet to draw upon.

Our interest obligations under the Hayfin credit agreement are subject to variable interest rates based on the Term SOFR in effect at the beginning of each monthly interest period.

With the global

rise in interest rates, we expect our interest rate and our monthly cash interest obligation to be higher in fiscal 2023 as compared to previous years.

For example, our stated interest rate, which was 10.75% for the month of June 2022, increased

to approximately 12.06% for the month of September and was approximately 14.16% for the month of February 2023.

On the Hayfin Maturity Date, we will pay Hayfin the entire outstanding principal amount underlying the Hayfin Loans and any accrued and unpaid interest thereon, as well as an exit fee of 1.0% of the

outstanding principal amount being paid.

Prior to the Hayfin Maturity Date, there are no scheduled principal payments on the Hayfin Loans.

We may prepay outstanding principal on the Hayfin Loans at any time and from time to time upon five

business days’ prior written notice, subject to the payment to Hayfin of, (A) any accrued but unpaid interest on the prepaid principal amount plus (B) a prepayment fee in the amount equal to (i) 7.0% of the prepaid principal amount, if prepaid on

or prior to the first anniversary of the Hayfin Closing Date, (ii) 3.0% of the prepaid principal amount, if prepaid after the first anniversary of the Hayfin Closing Date and on or prior to the second anniversary of the Hayfin Closing Date, or

(iii) 1.0% of the prepaid principal amount, if prepaid after the second anniversary of the Hayfin Closing Date and on or prior to the third anniversary of the Hayfin Closing Date.

In addition, for any prepayments of principal, we are required to

pay the 1.0% exit fee for the amount of principal being paid.

All of our obligations under the Hayfin Credit Agreement are secured by a first-priority lien and security interest in substantially all of our tangible and intangible assets, including intellectual

property and all of the equity interests in our subsidiaries.

The Hayfin Credit Agreement contains certain representations and warranties, affirmative covenants, negative covenants and conditions that are customarily required for similar

The negative covenants restrict or limit our ability and the ability of our subsidiaries to, among other things and subject to certain exceptions contained in the Hayfin Credit Agreement, incur new indebtedness;

create liens on

engage in certain fundamental corporate changes, such as mergers or acquisitions, or changes to our or our subsidiaries’ business activities;

make certain Investments or Restricted Payments (each as defined in the Hayfin Credit

and other manufacturing and laboratory testing materials and single use disposables.

to the refinancing of our senior debt of $26.2 million and an IT systems disruption of $2.7 million, as well as positive cash flow from operations, both for the first time in our history.

However, at present we cannot be certain that we will be

able to continue to generate a sufficient amount of product revenue to achieve profitability on an ongoing basis.

We currently anticipate, based upon our projected revenue and expenditures, that our current cash, cash equivalents and accounts

receivable, along with our projected future operating cash flow, will be sufficient to fund our operations, as currently conducted, through the end of the first quarter of fiscal 2025.

However, our current outlook with respect to cash flows and

profitability may change based upon several factors, including the success of our commercial efforts with respect to the sale of our products and the continued acceptability of our immune globulin products by physicians, patients or payers, and

whether or not the assumptions underlying our projected revenues and expenses are correct.

If we are unable to maintain positive cash flow throughout fiscal 2024, we may need to raise additional capital and if such capital is not available due to

widespread liquidity constraints or significant market instability that could result from international or global conflicts, economic uncertainty, COVID-19 or other pandemics, inflationary pressures or other factors beyond our control, we may have

to delay, curtail or eliminate some of our commercialization efforts or product development activities.

If we are unable to generate sufficient revenue to maintain positive cash flow throughout fiscal 2024 and need to raise additional capital, we

may decide to do so through public or private equity offerings or debt financings, or we may enter into a corporate collaboration or licensing arrangement.

The sale of additional equity securities or debt financings, if convertible, could result in

dilution to our stockholders and, in such event, the value and potential future market price of our common stock may decline.

ADMA continues to evaluate a variety of strategic alternatives, and the exploration of value-creating opportunities remains a top corporate priority.

On December 18, 2023 (the “Ares Closing Date”), we and all of our subsidiaries entered into a new senior secured credit facility (the “Ares Credit Agreement”) with Ares Capital Corporation and certain credit funds

affiliated with Ares Capital Corporation (collectively, “Ares”).

The Ares Credit Agreement provides for a total of $135.0 million in senior secured credit facilities (the “Ares Credit Facility”) consisting of (i) a term loan in the aggregate

principal amount of $62.5 million and (ii) a revolving credit facility in the aggregate principal amount of $72.5 million (collectively, the “Ares Loans”), both of which were fully drawn on the Ares Closing Date.

The Ares Credit Facility has a

maturity date of December 20, 2027 (the “Ares Maturity Date”).

On the Ares Closing Date, we used the proceeds from the Ares Loans, along with a portion of our existing cash on hand, to terminate and pay in full all of the outstanding obligations

under our previous senior credit facility (the “Hayfin Credit Facility”) with Hayfin Services LLP (“Hayfin”) including the outstanding principal in the amount of $158.6 million, a prepayment penalty in the amount $11.1 million, an exit fee of

$1.6 million, all accrued and unpaid interest outstanding on the Hayfin Credit Facility as of the Ares Closing date, as well as certain fees and expenses related thereto.

In connection with the payoff and termination of the Hayfin Credit

Facility, we also wrote off $15.0 million of unamortized debt discount related to the Hayfin Credit Facility.

As a result of this transaction, we recorded a loss on the extinguishment of the Hayfin Credit Facility in the amount of $26.2 million,

which is mainly comprised of the write-off of unamortized debt discount and the prepayment penalty.

Borrowings under the term loan initially bear interest at the adjusted Term SOFR for a three‑month tenor in effect on the day that is two business days prior to the first day of the applicable calendar quarter plus

6.50% (the “Initial SOFR Term Loan Applicable Margin”).

Borrowings under the revolving facility initially bear interest at the adjusted Term SOFR for a three‑month tenor in effect on the day that is two business days prior to the first day of the

applicable calendar quarterplus3.75% (the “SOFR Revolving Facility Applicable Margin”).

On the Ares Closing Date, the interest rate on the term loan was approximately 11.9% and the interest rate on the revolving facility was approximately 9.1%,

representing a weighted-average interest rate of approximately 10.4%.

Prior to the Ares Closing Date, the interest rate on the Hayfin Credit Facility was approximately 13.9%.

On the Ares Maturity Date, we are required to pay Ares the entire outstanding principal amount underlying the Ares Loans and any accrued and unpaid interest thereon.

Prior to the Ares Maturity Date, there are no

scheduled principal payments on the Ares Credit Facility, and we are required to make quarterly interest payments during the term of Ares Credit Facility of approximately $3.7 million.

We may prepay the outstanding principal under the revolving

facility, together with any accrued but unpaid interest on the prepaid principal amount, at any time and from time to time upon three business days’ prior written notice with no prepayment premium.

However, in the event that we prepay an amount

under the revolving facility that is greater than 50% of the current $72.5 million outstanding balance, we will still be required to pay interest on 50% of this balance, or $36.3 million, through the term of Ares Credit Facility.

We may prepay

the outstanding principal on the term loan, together with any accrued but unpaid interest on the prepaid principal amount, at any time and from time to time upon three business days’ prior written notice, subject to the payment to Ares of a

prepayment premium equal to (i) the present value as of such date of all remaining required interest payments on the principal amount being repaid plus 1.5% of the prepaid principal amount, if prepaid on or prior to the first anniversary of the

Ares Closing Date, (ii) 1.5% of the prepaid principal amount, if prepaid after the first anniversary of the Ares Closing Date and on or prior to the second anniversary of the Ares Closing Date, or (iii) 1.0% of the prepaid principal amount, if

prepaid on or prior to the third anniversary of the Ares Closing Date.

In connection with the closing of the Ares Credit Facility, we incurred fees and expenses related to the transaction of approximately $2.7 million, including a $1.7 million original issue discount payable to Ares,

all of which was deducted from the Ares loan proceeds.

In addition, we are also required to pay Ares an exit fee of $1.7 million upon the earlier of any prepayment date or the Ares Maturity Date, and this amount has been accrued as a separate

liability in our consolidated balance sheet as of December 31, 2023.

As a result, we recognized an aggregate debt discount of $4.4 million as of the Ares Closing Date, and the weighted-average effective interest rate on the Ares Loans as of

December 31, 2023 was 11.39%.

All of our obligations under the Ares Credit Agreement are secured by a first-priority lien and security interest in substantially all of our tangible and intangible assets, including intellectual property and all of

the equity interests in our subsidiaries.

The Ares Credit Agreement contains certain representations and warranties, affirmative covenants, negative covenants and conditions that are customarily required for similar financings.

covenants include certain financial covenants, including maximum total leverage ratios and a $15.0 million liquidity covenant, and also restrict or limit our ability and the ability of our subsidiaries to, among other things and subject to

certain exceptions contained in the Ares Credit Agreement, incur new indebtedness;

create liens on assets;

engage in certain fundamental corporate changes, such as mergers or acquisitions, or changes to our or our subsidiaries’ business

make certain Investments or Restricted Payments (each as defined in the Ares Credit Agreement);

engage in certain affiliate transactions;

or enter into, amend or terminate any other agreements that have the impact of restricting our

ability to make loan repayments under the Ares Credit Agreement.

As of December 31, 2023, we were in compliance with all of the covenants contained in the Ares Credit Agreement.

Events of default on the Ares Loans include, among others, non-payment of principal, interest or fees, violation of covenants, inaccuracy of representations and warranties, bankruptcy and insolvency events, material

judgments, cross-defaults to material contracts and events constituting a change of control.

If there is an event of default, we will incur an increase in the rate of interest on the Ares Loans of 2% per annum.

On March 23, 2022 (the “Hayfin Closing Date”), we and all of our subsidiaries entered into the Hayfin Credit Agreement with Hayfin.

The Hayfin Credit Agreement, as amended, provided for a senior secured term loan

facility in a principal amount of up to $175.0 million (the “Hayfin Credit Facility”), composed of (i) a term loan made on the Hayfin Closing Date in the principal amount of $150.0 million (the “Hayfin Closing Date Loan”), and (ii) a delayed draw

term loan in the principal amount of $25.0 million (the “Hayfin Delayed Draw Loan” and, together with the Hayfin Closing Date Loan, the “Hayfin Loans”).

The Hayfin Delayed Draw Loan was not drawn prior to the Hayfin Closing Date.

The Hayfin Credit

Facility had a maturity date of March 23, 2027 (the “Hayfin Maturity Date”), subject to acceleration pursuant to the Hayfin Credit Agreement, including upon an Event of Default (as defined in the Hayfin Credit Agreement).

On the Hayfin Closing Date, we used $100.0 million of the Hayfin Closing Date Loan to terminate and pay in full all of the outstanding obligations under our previous senior credit facility with Perceptive (see Note 7

to the Consolidated Financial Statements).

We also used $2.0 million of the Hayfin Closing Date Loan proceeds to pay a redemption premium to Perceptive and used approximately $1.0 million of the Hayfin Closing Date Loan proceeds to pay certain fees

and expenses incurred in connection with this transaction.

In addition, a $1.8 million upfront fee payable to Hayfin was paid “in kind” and was added to the outstanding principal balance in accordance with the terms of the Hayfin Credit Agreement.

Borrowings under the Hayfin Credit Agreement bore interest at the adjusted Term SOFR for either a one-month or three-month tenor, as elected by us, and subject to a floor of 1.25%, plus an applicable margin of 9.5%

(the “Applicable Margin”);

provided, however, that upon, and during the continuance of, an Event of Default, the Applicable Margin would increase by an additional 3% per annum.

On May 1, 2023 the Hayfin Credit Agreement was amended to reduce the

Applicable Margin from 9.5% to 8.5%.

On the last day of each calendar month prior to the Ares Closing Date we paid accrued interest to Hayfin.

On the Hayfin Closing Date, December 31, 2022 and the Ares Closing Date, the stated interest rate on the

Hayfin Loans was 10.75%, approximately 13.7% and approximately 13.9%, respectively.

We were also permitted to pay “in kind” a portion of the interest on the Hayfin Loans for each monthly interest period in an amount equal to 2.5% per annum, which

was added to the principal amount of the outstanding debt under the Hayfin Credit Facility.

From the Hayfin Closing Date through December 31, 2022, $3.0 million of interest was paid in kind and added to the balance of the outstanding Hayfin Loans.

For the year ended December 31, 2023, $3.8 million of interest was paid in kind and added to the balance of the outstanding Hayfin Loans.

On the Ares Closing Date, we paid Hayfin the entire outstanding principal amount underlying the Hayfin Loans and any accrued and unpaid interest thereon, as well as an exit fee of 1.0% of the outstanding principal

amount being paid.

In accordance with the terms of the Hayfin Credit Agreement, we also paid Hayfin the early prepayment fee in the amount equal 7.0% of the prepaid principal amount, or $11.1 million.

All of our obligations under the Hayfin Credit Agreement were secured by a first-priority lien and security interest in substantially all of our tangible and intangible assets, including intellectual property and all

of the equity interests in our subsidiaries.

The Hayfin Credit Agreement contained certain representations and warranties, affirmative covenants, negative covenants and conditions that are customarily required for similar financings.

covenants restricted or limited our ability and the ability of our subsidiaries to, among other things and subject to certain exceptions contained in the Hayfin Credit Agreement, incur new indebtedness;

create liens on assets;

engage in certain

fundamental corporate changes, such as mergers or acquisitions, or changes to our or our subsidiaries’ business activities;

make certain Investments or Restricted Payments (each as defined in the Hayfin Credit Agreement);

change our fiscal year;

2 unchanged sentences

engage in certain affiliate transactions;

or enter into, amend or terminate any other agreements that have the impact of restricting our ability to make loan

repayments under the Hayfin Credit Agreement.

In addition, we are required (i) at all times prior to the Maturity Date to maintain a minimum cash balance of $6.0 million;

and (ii) as of the last day of each fiscal quarter, report IVIG product and

related revenues for the trailing 12-month period that exceed the amounts set forth in the Hayfin Credit Agreement, which range from $75.0 million for the fiscal quarter ending June 30, 2022 to $250.0 million for the fiscal quarter ending

December 31, 2026 and each fiscal quarter thereafter.

As of December 31, 2022, we were in compliance with all of the financial covenants contained in the Hayfin Credit Agreement.

or enter into, amend or terminate any other agreements that have the impact of restricting our ability to make loan repayments under the Hayfin Credit

In addition, we were required (i) at all times prior to the Hayfin Maturity Date to maintain a minimum cash balance of $6.0 million;

and (ii) as of the last day of each fiscal quarter, report IVIG product and related revenues for the

trailing 12-month period that exceed the amounts set forth in the Hayfin Credit Agreement, which ranged from $75.0 million for the fiscal quarter ending June 30, 2022 to $110.0 million for the fiscal quarter ending September 30, 2023.

Ares Closing Date and December 31, 2022, we were in compliance with all of the financial covenants contained in the Hayfin Credit Agreement.

On December 9, 2022, we completed an underwritten public offering whereby we issued 24,125,873 shares of our common stock.

Net proceeds after underwriting discounts and expenses associated with the offering were

approximately $64.6 million and are being used to accelerate commercialization and production activities, complete plasma center buildouts and obtain FDA approvals, to conclude post‑FDA marketing approval research and development projects, and

for working capital, capital expenditures and general corporate purposes.

approximately $64.6 million and were used to accelerate commercialization and production activities, complete plasma center buildouts and obtain FDA approvals, to conclude post‑FDA marketing approval research and development projects, and for

working capital, capital expenditures and general corporate purposes.

On October 25, 2021, we completed an underwritten public offering whereby we issued 57.5 million shares of our common stock and received gross proceeds of $57.5 million.

Net proceeds, after underwriting discounts and

expenses associated with the offering, were approximately $53.8 million, and were used to advance the commercial sales of our FDA approved products through the procurement of raw materials for the manufacturing of

BIVIGAM and ASCENIV, to expand our plasma collection facility network, to scale up the manufacturing capacity of the Boca Facility and make continuous improvements in order to adhere to cGMP compliance, to explore business development

opportunities and for general corporate purposes and other capital expenditures.

On September 3, 2021, we entered into a distribution agreement with Raymond James & Associates, Inc., as agent (“Agent”), pursuant to which we may offer and sell, from time to

time, at our option, through or to the Agent, up to an aggregate of $50 million of shares of our common stock (the “Distribution Agreement”).

We currently intend to use any net proceeds from the sale of our common stock under the Distribution

Agreement for general corporate purposes, including procurement of source plasma and other raw materials, supply chain initiatives and production expenditures, funding expansion of plasma collection centers, working capital, capital

expenditures, expansion and resources for commercialization activities, and other potential research and development and business opportunities.

During the year ended December 31, 2021, we issued 5,540,831 shares of our common stock under the

Distribution Agreement and received net proceeds of $6.9 million.

We did not issue any shares under this agreement during the year ended December 31, 2022, and we currently have approximately $42.8 million of shares available to sell under

the Distribution Agreement.

plasma collection facility network, to scale up the manufacturing capacity of the Boca Facility and make continuous improvements in order to adhere to cGMP compliance, to explore business development opportunities and for general corporate purposes

and other capital expenditures.

On September 3, 2021, we entered into a distribution agreement with Raymond James & Associates, Inc., as agent (“Agent”), pursuant to which we may offer and sell, from time to time, at our option, through or to

the Agent, up to an aggregate of $50 million of shares of our common stock (the “Distribution Agreement”).

We currently intend to use any net proceeds from the sale of our common stock under the Distribution Agreement for general corporate

purposes, including procurement of source plasma and other raw materials, supply chain initiatives and production expenditures, working capital, capital expenditures, expansion and resources for commercialization activities, and other potential

research and development and business opportunities.

During the year ended December 31, 2021, we issued 5,540,831 shares of our common stock under the Distribution Agreement and received net proceeds of $6.9 million.

We did not issue any shares

under this agreement during the years ended December 31, 2023 and 2022, and we currently have approximately $42.8 million of shares available to sell under the Distribution Agreement.

The following table sets forth a summary of our cash flows for the periods indicated:

Year Ended December 31,

Net cash used in operating activities

Years Ended December 31,

(in thousands)

Net cash provided by (used in) operating activities

Net cash used in investing activities

Net cash provided by financing activities

Net cash (used in) provided by financing activities

Net change in cash and cash equivalents

Cash and cash equivalents - beginning of period

Cash and cash equivalents - end of period

Net Cash Used in Operating Activities

Cash used in operations for the year ended December 31, 2022 was $59.5 million, a decrease of $52.9 million from the same period of a year ago, mainly due to the improvement in our operating results after giving

effect to non-cash items, driven by higher revenues and gross margins, and reductions in accounts receivable related to the timing of shipments and collections from customers.

The following table illustrates the primary components of our cash

flows from operations:

Year Ended December 31,

Cash and cash equivalents - beginning of year

Cash and cash equivalents - end of year

Net Cash Provided by (Used in) Operating Activities

Cash provided by operations for the year ended December 31, 2023 was $8.8 million, as compared to cash used in operations of $59.5 million for the same period of a year ago.

This improvement was mainly due to the

improvement in our operating results, driven by higher revenues and gross margins, and a lower increase in inventories.

Cash used in operations for the year ended December 31, 2022 of $59.5 million represents a decrease of $52.9 million from the

same period of a year ago, mainly due to the improvement in our operating results after giving effect to non-cash items, driven by higher revenues and gross margins, and reductions in accounts receivable related to the timing of shipments and

collections from customers.

The following table illustrates the primary components of our cash flows from operations:

Years Ended December 31,

(in thousands)

Non-cash expenses, gains and losses

3 unchanged sentences

Changes in accounts payable and accrued expenses

Cash used in operations

Cash provided by (used) in operations

Net Cash Used in Investing Activities

Net cash used in investing activities for the year ended December 31, 2022 was $13.9 million, which consisted of $8.7 million for the construction and buildout of several new plasma collection facilities and $5.2

million for equipment purchases and upgrades to the Boca Facility.

Net cash used in investing activities for the year ended December 31, 2021 was $13.5 million, which consisted of $8.6 million for the construction and buildout of new plasma

collection facilities and $4.9 million of capital expenditures at the Boca Facility, which included equipment purchases and continued implementation of our in-house fill/finish capabilities.

While we do not have any firm commitments for material

capital expenditures in 2023, we expect our total capital expenditures will be between $8.0 million and $12.0 million for fiscal 2023.

Net Cash Provided by Financing Activities

Net cash provided by financing activities for the year ended December 31, 2022 was $108.9 million, as we received approximately $47.0 in net proceeds from the refinancing of our senior credit facility in March of

2022 and $64.6 million in net proceeds from the December 9, 2022 public offering of our common stock.

Cash provided by financing activities during the year ended December 31, 2021 was $121.0 million, which is mainly comprised of the net proceeds

of $67.3 million from the sale of our common stock through several sale agreements and $53.8 million from the October 2021 underwritten public offering.

Cash used in investing activities for the year ended December 31, 2023 was $5.0 million, which was primarily comprised of capital expenditures of $3.0 million for equipment purchases and facilities upgrades at the Boca

Facility, and $1.8 million to complete the buildout of our plasma collection facilities.

Net cash used in investing activities for the year ended December 31, 2022 was $13.9 million, which consisted of $8.7 million for the construction and buildout

of several new plasma collection facilities and $5.2 million for equipment purchases and upgrades to the Boca Facility.

Net cash used in investing activities for the year ended December 31, 2021 was $13.5 million, which consisted of $8.6 million

for the construction and buildout of new plasma collection facilities and $4.9 million of capital expenditures at the Boca Facility, which included equipment purchases and continued implementation of our in-house fill/finish capabilities.

do not have any firm commitments for material capital expenditures in 2024, we expect our total capital expenditures will be between $8.0 million and $12.0 million for fiscal 2024.

Net Cash (Used in) Provided by Financing Activities

Net cash used in financing activities for the year ended December 31, 2023 was $39.0 million, as we reduced our outstanding debt principal by $23.6 million with the refinancing of our senior debt on December 18, 2023

and paid approximately $12.7 million to exit the Hayfin Credit Facility.

Net cash provided by financing activities for the year ended December 31, 2022 was $108.9 million, as we received approximately $47.0 in net proceeds from the refinancing of

our senior credit facility in March of 2022 and $64.6 million in net proceeds from the December 9, 2022 public offering of our common stock.

Cash provided by financing activities during the year ended December 31, 2021 was $121.0 million, which is

mainly comprised of the net proceeds of $67.3 million from the sale of our common stock through several sale agreements and $53.8 million from the October 2021 underwritten public offering.

Effect of Inflation

Inflation impacted a number of facets of our business during the years ended December 31, 2023, 2022 and 2021 at each of our business segments.

We experienced price increases for, among other items, certain raw materials,

consumable supplies, services for repairs and maintenance of our facilities, utilities, shipping and freight charges, fuel surcharges and labor costs.

We expect this trend to continue at least into 2023 or longer, which could have a significant

impact on our future results of operations.

In addition, some of our plasma purchase agreements provide for annual price increases that are tied to various consumer price indices, which have resulted in higher than historical percentage price

increases and has resulted in and is expected to continue to result in higher source plasma and other raw material and supplies costs in fiscal 2023.

Quantitative and Qualitative Disclosures About Market Risk

Not applicable.

Financial Statements and Supplementary Data

Our financial statements required to be filed pursuant to this Item 8 appear in a separate section of this Annual Report on Form 10-K, beginning on page F-1.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

We experienced price increases for, among other items, certain raw

materials, consumable supplies, services for repairs and maintenance of our facilities, utilities, shipping and freight charges, fuel surcharges and labor costs, among other expenses.

Based upon the macroeconomic environment, publicly available

information and reports form the U.S.

government, we expect this trend to continue in 2024 and potentially longer, which could potentially have a significant impact on our future results of operations.

In addition, some of our third-party inventory

purchase agreements provide for annual price increases that are tied to various consumer price indices, which have resulted in higher than historical percentage price increases and has resulted in and could continue to result in higher source

plasma and other raw material and supplies costs in 2024 and beyond.

Also, in a higher inflationary environment, we may not be able to raise the prices of our products to keep up with the rate of inflation.

We are unable to predict when these

external drivers of inflation will subside.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis