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Item 7. Management’s Discussion and Analysis

2026-02-27 compared with 2025-02-28 · 200 added, 304 removed, 304 unchanged (62% of the section changed)

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Some of the statements in the following discussion are forward-looking statements.

See the discussion about forward-looking statements on page 1 of this Annual Report on Form 10-K.

This section of this Form 10-K generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023.

Discussions of 2022 items and year-to-year comparisons between 2023 and 2022 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 202 3 , filed with the SEC on F ebruary 29, 2024 .

See the discussion about forward-looking statements on page 1 of this Annual Report on Form 10-K, as actual results may differ materially from those contained in any forward-looking statements.

This section generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024.

Discussions of 2024 items and year-to-year comparisons between 2024 and 2023 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 202 4 , filed with the SEC on February 2 8 , 20 25 .

Executive Overview

ANI Pharmaceuticals, Inc.

and its consolidated subsidiaries (together, “ANI,” the “Company,” “we,” “us,” or “our”) is a diversified bio-pharmaceutical company committed to its mission of “Serving Patients, Improving Lives” by developing, manufacturing, and commercializing innovative and high quality therapeutics.

On September 16, 2024, the Company completed its previously announced acquisition of Alimera Sciences, Inc., a Delaware corporation, pursuant to the terms of the Agreement and Plan of Merger, dated as of June 21, 2024 (the “Merger Agreement”), by and among the Company, Alimera and ANIP Merger Sub INC., a Delaware corporation and wholly-owned subsidiary of the Company (“Merger Sub”).

Pursuant to the Merger Agreement, Merger Sub merged with and into Alimera, with Alimera surviving the merger as a wholly-owned subsidiary of the Company (the “Merger”).

In connection with the Merger, the Company added a growing and durable franchise, ILUVIEN® (fluocinolone acetonide intravitreal implant) 0.19 mg, which has received marketing authorization and reimbursement in the United States (“U.S.”) and 24 countries for the treatment of diabetic macular edema (“DME”) and YUTIQ® (fluocinolone acetonide intravitreal implant) 0.18 mg, available in the U.S.

ANI Pharmaceuticals is a diversified bio-pharmaceutical company.

The Company's mission is “Serving Patients, Improving Lives” by developing, manufacturing, and commercializing therapeutics through its Rare Disease, Generics, and Brands businesses.

On September 16, 2024, the Company acquired Alimera.

In connection with the Merger, the Company added a growing and durable franchise, ILUVIEN® (fluocinolon e acetonide intravitreal implant) 0.19 mg, which has received marketing authorization and reimbursement in the United States (“U.S.”) and 24 countries for the treatment of diabetic macular edema (“DME”) and YUTIQ® (fluocinolone acetonide intravitreal implant) 0.18 mg, available in the U.S.

for the treatment of non-infectious uveitis affecting the posterior segment of the eye (“NIU-PS”).

In connection with the acquisition of Alimera, the Company has assessed its strategic goals and aligned its operational initiatives into two reportable segments, and the discussion of the historical results of operations below has been revised, as applicable, to be consistent with the presentation of the revised reportable segments (see Note 19 "Segment Reporting in the notes to the consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K).

Our three pharmaceutical manufacturing facilities, of which two are located in Baudette, Minnesota, and one is located in East Windsor, New Jersey, are together capable of producing oral solid dose products, as well as semi-solids, liquids and topicals, controlled substances, and potent products that must be manufactured in a fully-contained environment.

We ceased operations at our subsidiary in Oakville, Ontario, Canada as of March 31, 2023.

This action was part of ongoing initiatives to capture operational synergies following our acquisition of Novitium Pharma LLC (“Novitium”) in November 2021.

We have fully completed the transition of the products manufactured or packaged in Oakville to one of our three U.S.

based manufacturing sites.

In February 2024, our Canadian subsidiary entered into an agreement for the purchase and sale of the Oakville site, for a purchase price of $19.2 million Canadian Dollars, or approximately $14.2 million, based on the current exchange rate.

The sale closed on March 28, 2024 (see Note 4 "Restructuring Canada Operations" in the notes to the consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K).

On August 13, 2024, the Company entered into a credit agreement with JPMorgan Chase Bank, N.A., as administrative agent, and the financial institutions party thereto as lenders, (the "New Credit Agreement") which provides for aggregate principal commitments consisting of (i) a senior secured delayed-draw term loan facility in an aggregate principal amount of $325.0 million, and (ii) a senior secured revolving credit facility in an aggregate commitment amount of $75.0 million, which may be used for revolving credit loans, swingline loans and letters of credit.

On September 16, 2024, ANI drew the full $325.0 million of New Credit Agreement principal, with proceeds used to finance the acquisition of Alimera, including fees, costs and expenses incurred in connection with the acquisition.

As of December 31, 2024, the revolving credit facility remains undrawn, and $75.0 million is available for borrowing, subject to the satisfaction of certain conditions.

The New Credit Agreement and the revolving credit facility mature on September 16, 2029.

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Subsequent to the acquisition of Alimera, we expanded the label for ILUVIEN to include an indication for chronic NIU-PS in addition to its then-current indication in DME in the U.S.

The Company owns and operates three pharmaceutical manufacturing facilities, including two facilities in Baudette, Minnesota, and one in East Windsor, New Jersey, which collectively are capable of producing oral solid dose products, as well as semi-solids, liquids and topicals, controlled substances, and potent products that must be manufactured in a fully-contained environment.

The Company ceased operations at another manufacturing facility in Oakville, Ontario as of March 31, 2023.

The sale closed on March 28, 2024.

See Note 4 "Restructuring Canada Operations" in the notes to the consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K.

On August 13, 2024, the Company entered into a credit agreement with JPMorgan Chase Bank, N.A., as administrative agent, and the financial institutions party thereto as lenders (the "2024 Credit Agreement"), which provides for aggregate principal commitments consisting of (i) a senior secured delayed-draw term loan facility in an aggregate principal amount of $325.0 million, and (ii) a senior secured revolving credit facility in an aggregate commitment amount of $75.0 million ($74.9 million of which remains undrawn), which may be used for revolving credit loans, swingline loans and letters of credit.

On August 13, 2024, the Company completed an offering of $316.25 million aggregate principal amount of the Company's Convertible Senior Notes due 2029 (the “Notes”).

The Notes are due September 1, 2029, unless earlier repurchased, redeemed, or converted.

After deducting the initial purchasers’ discounts and commissions of approximately $9.5 million, but before deducting the Company’s offering expenses, the net proceeds to the Company from the offering of the Notes was approximately $306.8 million.

In connection with the offering of Notes, on August 7, 2024 and August 8, 2024, the Company entered into capped call transactions with certain financial institutions (“Capped Calls”).

After payment of the cost of entering into the Capped Calls transactions, of approximately $40.6 million, the Company used the remainder of the net proceeds from the Notes offering, together with cash on hand, to repay the Company’s existing senior secured credit agreement with Truist Bank, dated as of November 19, 2021.

In May 2023, through a public offering, the Company completed the issuance and sale of 2,183,545 shares of ANI common stock, resulting in net proceeds after issuance costs of $80.6 million.

Our objective is to build a sustainable and growing biopharmaceutical company serving patients in need and creating long-term value for our investors.

Our overall strategy is enabled by an empowered, collaborative, and purposeful team with high performance-orienta tion that seeks to deliver on our purpose of “Servin g Patients, Improving Lives.”

Our strategy is driven by the following key growth drivers:

Building a successful Rare Disease and Brands Segment

We have spent significant time, effort and resources in establishing and expanding our Rare Disease and Brands segment which consists of our Rare Disease and Brands portfolio of products.

We plan to continue to expand our Rare Disease business, through a combination of organic growth and acquisition.

While we execute against our strategic initiatives that we believe will result in the long-term, sustainable growth and value to our stockholders, we continue to evaluate potential acquisitions and other strategic transactions of businesses that we believe complement our existing portfolio, infrastructure and capabilities or provide us with the opportunity to expand our existing capabilities.

The Brands portion of the segment is comprised of various branded products.

The acquisition of Alimera is anticipated to strengthen our Rare Disease business and expand our footprint beyond the U.S.

with the addition of Alimera’s direct marketing operations located in Germany, the United Kingdom, Portugal, and Ireland, as well as its partnerships in Europe, Asia, and the Middle East.

ILUVIEN and YUTIQ are a durable franchise with high barriers to genericization which the Company believes have a clear role for patients in need of alternative therapeutic options.

ANI sees the potential to unlock significant additional growth for the ILUVIEN and YUTIQ franchise through commercial synergies and execution.

Purified Cortrophin ® Gel

We acquired the NDAs for Purified Cortrophin® Gel (Repository Corticotropin Injection USP) (“Cortrophin Gel”) and Cortrophin-Zinc TM in January 2016 and executed long-term supply agreements with a supplier of our primary raw material for corticotrophin API, a supplier of corticotrophin API with whom we have advanced the manufacture of commercial scale batches of API, and a Cortrophin Gel fill/finish contract manufacturer.

On October 29, 2021, the FDA approved the Company’s Supplemental New Drug Application ("sNDA") for Cortrophin Gel for the treatment of certain chronic autoimmune disorders, including acute exacerbations of multiple sclerosis (“MS”) and rheumatoid arthritis (“RA”), in addition to excess urinary protein due to nephrotic syndrome.

Cortrophin Gel is an adrenocorticotropic hormone (“ACTH”), also known as purified corticotropin.

On January 24, 2022, we announced the commercial launch of Cortrophin Gel in the U.S.

as our foundational Rare Disease asset.

Throughout 2023 and 2024, we continued to build and invest in our infrastructure to support growth in new areas of opportunity, such as pulmonology, ophthalmology, and gout in the ACTH market.

On October 2, 2023, we announced FDA approval and commercial availability of a 1-mLvial of Cortrophin Gel, appropriate for adjunctive treatment of certain patients with acute gouty arthritis flares.

During the first quarter of 2024, ANI launched a targeted ophthalmology-focused sales force for Cortrophin Gel.

The team has continued to gain momentum in ophthalmology, driving significant growth in the number of new patient starts during 2024.

Importantly, the addition of Alimera expands the reach of the ophthalmology sales team and we believe there will be significant overlap between high potential prescribers of Cortrophin Gel, ILUVIEN, and YUTIQ.

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ILUVIEN and YUTIQ

ILUVIEN (fluocinolone acetonide intravitreal implant) 0.19 mg, was developed in the U.S.

and internationally for the treatment of diabetic macular edema (“DME”), a leading cause of severe vision loss and blindness, and certain international markets for chronic non-infectious uveitis affecting the posterior segment of the eye (“NIU-PS”).

We acquired exclusive commercialization rights to YUTIQ (fluocinolone acetonide intravitreal implant) 0.18 mg, in May 2023 from EyePoint Pharmaceuticals, Inc.

(“EyePoint”) for the treatment and prevention of NIU-PS worldwide except for Europe, the Middle East, Africa, (known as ILUVIEN in Europe, the Middle East and Africa) and certain Asian countries including China.

ILUVIEN and YUTIQ are state-of-the-art sustained release intravitreal implants that respectively help patients maintain vision longer and reduce disease recurrence.

ILUVIEN is being evaluated as baseline therapy in naïve or near naïve patients with early DME in combination with the current standard of care, anti-vascular endothelial growth factor (“VEGF”) therapy in the NEW DAY clinical trial .

YUTIQ is being further studied in the SYNCHRONICITY Clinical Trial, a prospective, open-label clinical trial evaluating the safety and efficacy of YUTIQ for the treatment and prevention of chronic NIU-PS and related intraocular inflammation.

Both ILUVIEN and YUTIQ treat patients by delivering a continuous microdose of the corticosteroid fluocinolone acetonide (“FAc”) in the eye, for up to 36 months.

ILUVIEN was developed internally and initially to treat DME, a disease of the retina that affects individuals with Type 1 or Type 2 diabetes and can lead to severe vision loss and blindness.

ILUVIEN is sold to treat DME only in the U.S.

YUTIQ is sold to treat NIU-PS only in the U.S.

In certain European and Middle Eastern countries, ILUVIEN is approved and commercialized to treat DME and to prevent relapse in recurrent NIU-PS, an inflammatory disease of the uveal tract, which is comprised of the iris, ciliary body and choroid, that can lead to severe vision loss and blindness.

We also have rights to commercialize ILUVIEN for NIU-PS in Africa.

ILUVIEN and YUTIQ are both intravitreal implants that are inserted into the back of the patient’s eye in non-surgical procedures employing devices with 25-gauge needles, which allow for a self-sealing wounds.

“Intravitreal” refers to the space inside the eye behind the lens that contains the jelly-like substance called vitreous.

The implants, which are non-bioerodible, provide consistent delivery as a result of their constant surface area, permitting elution of FAc to the vitreous.

We call this CONTINUOUS MICRODOSING™.

This delivery mechanism provides lower daily and aggregate exposure to corticosteroids than any other intraocular dosage forms currently available, which we believe mitigates the typical risks associated with corticosteroid therapy.

CONTINUOUS MICRODOSING delivery makes ILUVIEN and YUTIQ the only approved drug therapies for DME and NIU-PS that are designed to deliver consistent daily therapeutic levels of corticosteroid and reduce the recurrence of DME and uveitis for up to three years.

Other therapies that physicians currently use to treat DME, such as anti-VEGF treatments and other corticosteroids, are acute (short-acting) therapies that provide a higher initial daily dose but then rapidly decline, requiring frequent reinjection by the physician to maintain an effective dose or reestablish the therapeutic effect after the disease has recurred.

FAc is a non-proprietary corticosteroid and the active compound in ILUVIEN (0.19mg) and YUTIQ (0.18mg).

We believe that corticosteroids provide the best option in the treatment of DME and NIU-PS because they reduce the inflammatory aspects of both diseases.

ILUVIEN and YUTIQ deliver continuous daily sub-microgram levels of FAc in in vivo release kinetic studies for up to 36 months.

ILUVIEN and YUTIQ are the only single injection therapies available to treat retinal diseases consistently every day for up to three years, which may allow patients to see better, longer, with fewer injections.

We have grown our brands portfolio of products through acquisition.

We have acquired the NDAs for and market Atacand, Atacand HCT, Arimidex, Casodex, Lithobid, Vancocin, Inderal LA, Inderal XL, InnoPran XL, Oxistat, and Veregen.

We are innovating in our go-to-market strategy through creative partnerships and a sales force for these products.

Strengthening our Generics and Other segment through continued investment in our generic research and development capability and increased focus on niche opportunities

We have grown our generics business through a combination of market share gains on existing products and new product launches.

We have also successfully acquired numerous ANDAs through business and asset acquisitions.

Our most recent business acquisition in the Generics and Other segment was the acquisition of Novitium in 2021, which included its portfolio of commercial and pipeline generic products, manufacturing and development facilities and expert workforce.

The Novitium acquisition significantly increased our generic pharmaceutical research and development and manufacturing capabiliti es.

We have begun to increase our focus on niche lower competition opportunities such as injectables, Paragraph IV, and competitive generic therapy (“CGT”) designation filings.

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Additionally, we will continue to seek opportunities to enhance our capab ilities through strategic partnerships and acquisitions of assets and businesses.

D uring 2023, we acquired two ANDAs and one pipeline product from the Chapter 7 Trustee for the estates of Akorn Holding Company and certain of its affiliates, acquired an ANDA and registered patents and pending patent applications from Slayback Pharma Limited Liability Company, and acquired additional ANDAs and product rights for two products in the second half of 2023.

During 2022, we completed an asset acquisition of four ANDAs from Oakrum Pharma, including two that were co mmercial at the time of acquisition.

Generic Product Development Considerations

We consider a variety of criteria in determining which products to develop.

These criteria include:

• Formulation Complexity .

Our development and manufacturing capabilities enable us to manufacture pharmaceuticals that are differentiated and include high potency, modified release, combination, and hormonal products.

This ability to manufacture a variety of differentiated products is a competitive strength that we intend to leverage in selecting products to develop and commercialize.

• Market Size and Patient Need .

When determining whether to develop or acquire an individual product, we review the current and expected market size for that product and competitive environment.

We endeavor to pursue products with sufficient market size to enable us to enter the market with a strong likelihood of serving patients in need and thus being able to price our products both competitively and at a profit.

• Profit Potential.

In determining the potential profit of a product, we forecast our anticipated market share, pricing, competitive environment and the estimated cost to manufacture the products.

• Manufacturing.

We generally seek to develop and manufacture products at our own manufacturing plants to ensure quality control of our products, supply chain reliability and to more closely control the economic inputs and outputs of our products.

• Competition.

When determining whether to develop or acquire a product, we research existing and expected competition.

We seek to develop products for which we can obtain sufficient market share and may decline to develop a product if we anticipate significant competition.

Our manufacturing facilities provide a means of entering niche markets, such as hormone therapies, in which fewer generic companies typically compete.

Fiscal 2024 Developments

On September 16, 2024, ANI drew the full $325.0 million of principal under the 2024 Credit Agreement, with proceeds used to finance the acquisitio n of Alimera, including fees, costs and expenses incurred in connection with the acquisition.

As of December 31, 2025, the revolving credit facility remains undrawn, and $74.9 million is available for borrowing, subject to the satisfaction of certain conditions.

The 2024 Credit Agreement and the revolving credit facility mature on September 16, 2029.

Recent Developments

Purchase of SWK Royalty

Pursuant to a Royalty Purchase Agreement dated as of December 17, 2020, EyePoint sold its right to receive royalty payments on future sales of ILUVIEN to SWK Funding LLC (“SWK”) under the existing collaboration agreement entered into in July 2017 between EyePoint and the Company (the “RPA Transaction”).

In connection with the RPA Transaction, the Company agreed to pay such royalty payments directly to SWK (see Note 11 “Goodwill and Intangible Assets” to the notes to the consolidated financial statements).

On June 19, 2024, Alimera entered into a letter agreement with SWK, pursuant to which the parties agreed to a lower fixed royalty payment of 3.125% (the “Alternative Royalty”) on combined sales of ILUVIEN and YUTIQ.

The letter agreement included a buy-out of the Alternative Royalty at Alimera’s option at any time during the period within six (6) months after a change of control of Alimera, after which SWK would have no further right to receive any payments under the letter agreement or the RPA (the “Buy-Out Option”).

On March 17, 2025, the Company exercised the Buy-Out Option and paid SWK $17.3 million with cash on hand, and as such, no further royalty is due to SWK on net revenues after January 1, 2025.

Acquisition of Alimera Sciences, Inc.

On September 16, 2024, the Company completed our previously announced merger with Alimera (the “Closing”).

At the effective time of the Merger (the “Effective Time”), each share of common stock, par value $0.01 per share, of Alimera (the “Alimera Common Stock”) outstanding immediately prior to the Effective Time including each Alimera RSA, Alimera PSU, Alimera RSU, and Alimera Warrant (as defined below), but excluding any treasury shares or shares owned by the Company, Merger Subs or any other subsidiary of the Company or Alimera), was canceled and ceased to exist and was converted into the right to receive (i) $5.50 in cash (“Closing Cash Consideration”), and (ii) one contingent value right (a “CVR”), which represents the right to receive the milestone payments (as defined below) subject to the terms and conditions set forth in the CVR Agreement entered into on September 16, 2024 (clauses (i) and (ii) collectively, the “Merger Consideration”).

At the effective time of the Merger (the “Effective Time”), each share of common stock, par value $0.01 per share, of Alimera (the “Alimera Common Stock”) outstanding immediately prior to the Effective Time including each Alimera RSA, Alimera PSU, Alimera RSU, and Alimera Warrant (each as defined below), but excluding any treasury shares or shares owned by the Company, merger subsidiaries or any other subsidiary of the Company or Alimera), was canceled and ceased to exist and was converted into the right to receive (i) $5.50 in cash (“Closing Cash Consideration”), and (ii) one contingent value right (a “CVR”), which represents the right to receive the milestone payments subject to the terms and conditions set forth in the CVR Agreement entered into on September 16, 2024 (clauses (i) and (ii) collectively, the “Merger Consideration”).

The Company also repaid $72.5 million of Alimera debt.

Each CVR entitles the holder to receive milestone payments for 2026 and 2027.

The milestone payments for each CVR equals the product (rounded to the nearest 1/100 of $0.01) of $0.25 multiplied by a fraction (which is no case will exceed one), and (i) for 2026, equals the amount, if any, by which the 2026 Net Revenue exceeds $140.0 million, divided by $10.0 million (subject to adjustment for the exercise price of eligible options), and (ii) for 2027, equals the amount, if any, by which the 2027 Net Revenue exceeds $160.0 million, divided by $15.0 million (subject to adjustment for the exercise price of applicable Alimera Options).

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In addition to the amounts payable to the holders thereof in connection with the Closing, all of the outstanding awards of restricted stock with respect to shares of Alimera Common Stock (each, an “Alimera RSA”), each Alimera Performance Stock Unit (“Alimera PSU”), each Alimera Restricted Stock Unit (“Alimera RSU”) and each Alimera Warrant that were outstanding immediately prior to the Effective Time were automatically canceled and converted into the right to receive one (1) CVR per share of Alimera Common Stock then underlying the applicable instrument.

The milestone payments for each CVR equals the product (rounded to the nearest 1/100 of $0.01) of $0.25 multiplied by a fraction (which is no case will exceed one), and (i) for 2026, equals the amount, if any, by which the 2026 Net Revenue (as defined therein) exceeds $140.0 million, divided by $10.0 million (subject to adjustment for the exercise price of eligible options), and (ii) for 2027, equals the amount, if any, by which the 2027 Net Revenue exceeds $160.0 million, divided by $15.0 million (subject to adjustment for the exercise price of applicable Alimera Options).

In addition to the amounts payable to the holders thereof in connection with the Merger, all of the outstanding awards of restricted stock with respect to shares of Alimera Common Stock (each, an “Alimera RSA”), each Alimera Performance Stock Unit (“Alimera PSU”), each Alimera Restricted Stock Unit (“Alimera RSU”) and each Alimera warrant ("Alimera Warrant") that were outstanding immediately prior to the Effective Time were automatically canceled and converted into the right to receive one (1) CVR per share of Alimera Common Stock then underlying the applicable instrument.

Each stock option previously granted by Alimera to purchase Alimera Common Stock (each, an “Alimera Option”) that was outstanding and unexercised as of the Effective Time and which had a per share exercise price that was less than the Closing Cash Consideration was, in addition to the amounts payable to the holders thereof in connection with the Closing, automatically canceled and converted into the right to receive one (1) CVR per share of Alimera Common Stock then underlying such Alimera Option.

No other Alimera Options were cancelled and converted into the right to receive a CVR, provided that each Alimera Option with a per share exercise price greater than or equal to the Closing Cash Consideration but less than the Total Consideration (as defined in the Merger Agreement) may receive a payment in connection with the payout of the CVRs (if any).

During the year ended December 31, 2024, the Company incurred approximately $12.4 million in transaction costs related to the Merger Agreement, all of which were expensed.

See Note 3 “Business Combination” to the notes to the consolidated financial statements for further information on the acquisition.

New Capital Structure

Refer to the Liquidity and Capital Resources below for further discussion of changes to our capital structure during 2024.

Restructuring

On February 15, 2024, ANI Pharmaceuticals Canada, Inc., a wholly owned subsidiary of the Company, entered into an agreement (the “Agreement”) with 1540700 Ontario Limited (“Buyer”) for the sale of ANI’s Oakville, Ontario former manufacturing site (the “Property”) for a total purchase price of $19.2 million Canadian Dollars, or approximately $14.2 million , based on the exchange rate at closing.

During February 2024, and in accordance with the Agreement, the Buyer deposited a total of approximately $1.9 million Canadian Dollars, or approximately $1.4 million in refundable deposits in escrow as part of the total purchase price.

On March 28, 2024 the Company completed the sale of the Property.

After payment of commissions, taxes, and other related costs of approximately $0.7 million, the Company received a net cash amount of approximately $13.5 million at closing.

The gain on the sale of the Property was approximately $5.3 million, recorded in the consolidated statements of operations.

See Note 3 “Business Combination” to the notes to the consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K for further information on the acquisition.

Capital Structure

On March 8, 2021, concurrently with the acquisition of Novitium, and as financing for a portion of the acquisition, the Company entered into an Equity Commitment and Investment Agreement with Ampersand 2020 Limited Partnership (the “PIPE Investor”), pursuant to which the PIPE Investor purchased 25,000 shares of Series A Convertible Preferred Stock (the “PIPE Shares”), for a purchase price of $1,000 per share and an aggregate purchase price of $25.0 million on November 19, 2021.

The PIPE Shares were classified as mezzanine equity because the shares were mandatorily redeemable for cash upon a change in control, an event that was not solely within the Company’s control.

The PIPE Shares accrued dividends at 6.50% per year on a cumulative basis, payable in cash or in-kind, and participated, on a pro-rata basis, in any dividends that would be declared with respect to the Company's common stock.

The PIPE Shares were convertible into common shares at the conversion price of $41.4662 (i) beginning two years after their issuance date, at the election of ANI, if the volume-weighted average price of the common stock for any 20 trading days out of 30 consecutive trading days exceeds 170% of the conversion price, or (ii) at any time after issuance, at the election of the PIPE Investor.

On August 14, 2025, the PIPE Investor converted 5,000 PIPE Shares into 120,580 shares of common stock based on the conversion price of $41.4662 per share.

On September 26, 2025, the Company elected mandatory conversion of the remaining 20,000 outstanding PIPE Shares into 482,320 shares of common stock based on the conversion price of $41.4662 per share, as the conditions for conversion had been satisfied.

There were no shares of Series A Convertible Preferred Stock outstanding as of December 31, 2025.

Refer to the Liquidity and Capital Resources below for further discussion of changes to our capital structure during 2025 and 2024.

Product Launches

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Impacts to our 2025 and 2024 results of operations, including to net revenues, operating expenses, interest and other expense, net, and income taxes are described below.

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The following table summarizes our results of operations for the periods indicated:

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Contingent consideration fair value adjustment (31,012) (619)

Gain on sale of building (5,347) —

Restructuring activities — 1,132

Loss (gain) on disposal of assets 382 (5,347)

Intangible asset impairment charge 767 7,600

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Interest expense, net (20,060) (17,602)

Other expense, net (4,033) (159)

Other income (expense), net 1,934 (4,033)

Loss on extinguishment of debt — (7,468)

(Loss) Income Before (Benefit) Expense for Income Taxes

Income (Loss) Before (Benefit) Expense for Income Taxes

95,791 (22,212)

Income tax (benefit) expense

Income tax expense (benefit)

17,454 (3,690)

Net (Loss) Income $ (18,522) $ 18,779

Net Income (Loss) $ 78,337 $ (18,522)

The following table sets forth, for the periods indicated, items in our consolidated statements of operations as a percentage of net revenues.

Year Ended December 31,

Net Revenues 100.0 % 100.0 %

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Contingent consideration fair value adjustment (3.5) % (0.1) %

Gain on sale of building (0.9) % — %

Restructuring activities — % 0.2 %

Loss (gain) on disposal of assets — % (0.9) %

Intangible asset impairment charge 0.1 % 1.2 %

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Interest expense, net (2.3) % (2.9) %

Other expense, net (0.7) % — %

Other income (expense), net 0.2 % (0.7) %

Loss on extinguishment of debt — % (1.2) %

(Loss) Income Before (Benefit) Expense for Income Taxes (3.6) % 4.2 %

Income tax (benefit) expense (0.6) % 0.2 %

Net (Loss) Income (3.0) % 4.0 %

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Income (Loss) Before Expense (Benefit) for Income Taxes 10.9 % (3.6) %

Income tax expense (benefit) 2.0 % (0.6) %

Net Income (Loss) 8.9 % (3.0) %

Results of Operations for the Years Ended December 31, 2025 and 2024

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Cortrophin Gel $ 347,778 $ 198,085 $ 149,693 75.6 %

ILUVIEN and YUTIQ 31,514 — 31,514 100.0 %

ILUVIEN and YUTIQ 74,868 31,514 43,354 N/M

Rare Disease total net revenues $ 422,646 $ 229,599 $ 193,047 84.1 %

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Total net revenues $ 883,366 $ 614,376 $ 268,990 43.8 %

We derive substantially all of our revenues from sales of rare disease, brands portfolio of pharmaceutical products, generics, and other sources of revenue such as royalties on net sales of certain products, and other pharmaceutical services.

Essentially all of our generic products face competition from other generic products, as do many of our brands products, and we expect them to continue to face competition from generic products in the future.

"N/M" - not meaningful percentage due to the acquisition of ILUVIEN and YUTIQ on September 16, 2024.

We derive substantially all of our revenues from sales of our Rare Disease, Brands and Generics portfolios of pharmaceutical products, as well as from other sources of revenue such as royalties on net sales of certain products, and other pharmaceutical services.

Essentially all of our Generics products face competition from other generic products, as do many of our Brands products, and we expect them to continue to face competition from generic products in the future.

The primary means of competition among generic manufacturers are pricing, contract terms, service levels, and reliability.

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In addition, due to strategic partnerships between wholesalers and pharmacy chains, we have experienced, and expect to continue to experience, increases in net sales to the wholesalers, with corresponding decreases in net sales to the pharmacy chains.

Net revenues for the year ended December 31, 2024 were $614.4 million compared to $486.8 million for the same period in 2023, an increase of $127.6 million, or 26.2%, primarily as a result of the following:

• Net revenues from Rare Disease and Brands, includes rare disease and brands portfolio of pharmaceutical products was $294.3 million during the year ended December 31, 2024, an increase of $96.8 million, compared to $197.5 million, for the same period in 2023.

• Net revenues for rare disease pharmaceutical products, include Cortrophin Gel and a full quarter contribution from ILUVIEN and YUTIQ, were $229.6 million during the year ended December 31, 2024, an increase of $117.5 million from $112.1 million for the same period in 2023.

This increase was driven by increased volume in this third year of launch of Cortrophin Gel (product was launched in late January 2022) from overall ACTH market growth and share growth, and a full quarter of sales from ILUVIEN and YUTIQ, as a result of the acquisition of Alimera on September 16, 2024.

• Net revenues for brands portfolio of pharmaceutical products were $64.7 million during the year ended December 31, 2024, a decrease of $20.6 million compared to $85.4 million for the same period in 2023, driven by a net decrease in volume.

During portions of the prior year and the first quarter and portions of the fourth quarter of 2024, we were successful in supplying incremental volume in markets that were experiencing supply chain disruptions for competing products.

This incremental volume was not a significant factor in the second and third quarter of 2024.

Incremental volume achieved toward the end of 2024 continued into the first half of the first quarter of 2025.

The timing, magnitude and persistence of such market share gains are inherently difficult to predict and they may not persist in future reporting periods.

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• Net revenues for generic and other pharmaceutical products were $320.0 million during the year ended December 31, 2024, an increase of 10.6% compared to $289.3 million for the same period in 2023, primarily a result of the following:

• Generic pharmaceutical products net revenues were $301.0 million during the year ended December 31, 2024, an increase of $31.6 million over the prior year.

This increase was driven by increased volumes on the base business, increased volumes from the full year benefit of 2023 launches in 2024 and 2024 new product launc hes.

The Company launched a total of 17 new products in 2024.

From a product perspective, the increase was principally driven by revenues from year over year increases in products such as Baclofen OS, Candesartan, Colestipol, Estradiol, Ketoconazole, L-Glutamine, Pentoxyifylline, Pirfenidone, Prednisone, Vancomycin, among others.

• Net revenues from royalties and other pharmaceuticals was down modestly between December 31, 2024 and the prior year.

Net revenues for the ye ar ended December 31, 2025 were $883.4 million compared to $614.4 million for the same period in 2024, an increase of $269.0 million, or 43.8%, p rimarily as a result of the following:

• Net revenues from Rare Disease and Brands, which includes our rare disease and brands portfolios of pharmaceutical products, was $484.0 million during the year ended December 31, 2025, an increase of $189.6 million, compared to $294.3 million for the same period in 2024.

• Net revenues for Rare Disease pharmaceutical products were $422.6 million during the year ended December 31, 2025, an increase of $193.0 million from $229.6 million for the same period in 2024.

This increase was driven by increased volume of Cortrophin Gel from overall ACTH market growth and market share gains, and a full year of sales from ILUVIEN and YUTIQ.

ILUVIEN and YUTIQ were acquired from Alimera in September 2024.

• Net revenues for Brands portfolio of pharmaceutical products were $61.3 million during the year ended December 31, 2025, a decrease of $3.4 million compared to $64.7 million for the same period in 2024, driven by a net decrease in demand for certain products.

• Net revenues for Generic and Other pharmaceutica l products were $399.4 million during the year ended December 31, 2025, an increase of 24.8% compared to $320.0 million for the same period in 2024, primarily as a result of the following:

• Generic pharmaceutical products net revenues w ere $384.1 million during the year ended December 31, 2025, an increase of $83.1 million over the prior year.

This increase was driven by the December 2024 launch of Prucalopride Tablets, which included CGT designation and corresponding 180 day exclusivity that expired in late June 2025, increased volumes from the benefit of new product launches during 2025, inclusive of a partnered generic product launched in Q3 2025, along with annualization of new product launches that occurred during 2024.

The Company launched a total of 13 and 17 new products in 2025 and 2024, respectively.

From a product perspective, in addition to the products cited above, the increase was principally driven by revenues from year over year increases in products such as Ketoconazole, Nitazoxanide, and Thyroid Tablets, among others.

• Net revenues from royalties and other pharmaceuticals were down modestly between December 31, 2025 and the prior year due to fewer contract manufacturing shipments during the current year.

Cost of Sales (Excluding Depreciation and Amortization)

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Cost of sales (excluding depreciation and amortization) $ 341,310 $ 250,210 $ 91,100 36.4 %

Cost of sales consists of direct labor, including manufacturing and packaging, active and inactive pharmaceutical ingredients, freight costs, packaging components, royalties payable related to profit-sharing arrangements, and amortization of the inventory fair value step-up recognized in connection with the acquisition of Alimera.

Cost of sales does not include depreciation and amortization expense, which is reported as a separate component of operating expenses on our consolidated statements of operations.

For the year ended December 31, 2025, cost of sales increased to $341.3 million from $250.2 million for the same period in 2024, an increase of $91.1 million or 36.4%.

The increase is primarily due to significant net growth in sales volumes of pharmaceutical products, significant growth of royalty bearing products, including Cortrophin Gel, and the amortization of the inventory step up related to the acquisition of Alimera of approximately $13.6 million.

Cost of sales, as a percentage of net revenues, increased from 37.3% to 40.7% for the year ended December 31, 2024, compared to the same period in 2023, primarily due to a shift in product mix year over year, and increase in sales of products that bear a royalty payable.

During the year ended December 31, 2024, 12% of our raw material inventory purchases were from one domestic supplier.

During the year ended December 31, 2023, no single vendor represented at least 10% of our raw material inventory purchases.

During the year ended December 31, 2022 approximately 19% , of our raw material inventory purchases were from one domestic supplier.

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The increase is primarily due to significant net growth in sales volumes of pharmaceutical products and significant growth of royalty bearing products, including Cortrophin Gel and other products in our portfolio.

Cost of sales, as a percentage of net revenues, decreased to 38.6% for the year ended December 31, 2025, from 40.7% for the same period in 2024, primarily due to the non-recurrence of $13.6 million of inventory step-up related to the acquisition of Alimera during 2024.

During the years ended December 31, 2025 and 2024, 17% and 12%, respectively, of our raw material inventory purchases were from one domestic supplier.

Other Operating Expenses, net

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Contingent consideration fair value adjustment (31,012) (619) (30,393) 4910.0 %

Restructuring activities — 1,132 (1,132) (100.0) %

Gain on sale of building (5,347) — (5,347) (100.0) %

Loss (gain) on disposal of assets 382 (5,347) 5,729 (107.1) %

Intangible asset impairment charge 767 7,600 (6,833) (89.9) %

Total other operating expenses $ 430,963 $ 363,582 $ 67,381 18.5 %

For the year ended December 31, 2024, other operating expenses increased to $363.6 million from $258.3 million for the same period in 2023, an increase of $105.3 million, or 40.7%, primarily as a result of the following factors:

• R esearch and development expenses increased from $34.3 million to $44.6 million, an increase of 30.0%, primarily due to a higher level of activity associated with ongoing and new projects, including expenses related to the New Day and Synchronicity clinical trials during the year ended December 31, 2024.

• Selling, general, and administrative expenses increased from $161.7 million to $249.6 million, an increase of 54.4%, due to increased employment related costs, including incentive based compensation tied to record 2024 financial performance, investment in Rare Disease sales and marketing infrastructure and activities, legal expenses, transaction and integration expenses related to the acquisition of Alimera of approximately $18.2 million, severance expense of approximately $5.3 million and the settlement of all outstanding equity awards held by Alimera employees of approximately $9.2 million, and an overall increase in activities to support revenue growth in our Rare Disease and Brands segment.

• Depreciation and amortization expense was $67.7 million f or the year ended December 31, 2024, compared to $59.8 million for the same period in 2023, an increase of approximately $7.9 million, primarily related to th e amortization expense of the acquired intangible assets of ILUVIEN and YUTIQ of approximately $9.6 million.

These assets were acquired on September 16, 2024 from Alimera.

• We recognized a gain of $0.6 million and loss of $1.4 million in the year ended December 31, 2024 and 2023, respectively, for the contingent consideration fair value adjustment.

This financial statement line item consists of three components;

the changes in fair value of (1) the Novitium contingent consideration;

(2) the Alimera contingent value rights;

and (3) the accrued Alimera licensor payments.

• We recorded a gain of approximately $0.6 million related to the the decrease in the expected future payments related to Novitium contingent consideration, and a decrease in fair value of $0.3 million related to the decrease in expected future payments of the accrued licensor payments.

The gain was offset by a loss related to the increase in fair value of $0.3 million related to the Alimera contingent value rights.

• We recognized restructuring activities expenses of $1.1 million of expense in the year ended December 31, 2023, In 2023 costs included severance and other employee benefits costs of $0.2 million, $0.7 million of accelerated depreciation costs, and $0.2 million for other miscellaneous costs.

There were no restructuring expenses recognized in the year ended December 31, 2024 .

• We recognized a gain related to the sale of the former Oakville, Ontario manufacturing site of approximately $5.3 million during the year ended December 31, 2024.

There was no comparable sale in the year ended December 31, 2023.

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• We recognized an impairment charge related to a portfolio of definite-lived intangible assets of $3.6 million and IPR&D of approximately $4.0 million during the three months ended December 31, 2024.

There was no comparable intangible asset impairment charge in the year ended December 31, 2023.

For the year ended December 31, 2025, other operating expenses, net, in creased to $431.0 million from $363.6 million for the same period in 2024, an increase of $67.4 million, or 18.5%, primarily as a result of the following factors:

• Research and development expenses increased from $44.6 million to $51.7 million, an increase of 15.9%, primarily due to a higher level of activity associated with ongoing and new projects to support future growth of our Generics and Rare Disease portfolios.

Generics and Rare Disease expenses increased by approximately $6.0 million and $0.8 million, respectively, as compared to the year ended December 31, 2024.

• Selling, general, and administrative expenses increased from $249.6 million to $317.7 million, an increase of 27.3%, due to increased employment related costs, investment in Rare Disease sales and marketing infrastructure (including our new, larger ophthalmology sales and marketing team) and activities, legal expenses, and an overall increase in activities to support the growth of our business during the year ended December 31, 2025;

offset by a decrease of approximately $16.0 million related to transaction and integration costs for the acquisition of Alimera, and $15.4 million related to severance and equity payments to former Alimera employees incurred during the year ended December 31, 2024, which did not recur during the year ended December 31, 2025.

• Depreciation and amortization expense was $91.4 million for the year ended December 31, 2025, compared to $67.7 million for the same period in 2024, an increase of approximately $23.7 million, primarily related to the increase in amortization expense of the acquired intangible assets, ILUVIEN and YUTIQ.

Amortization expense for these assets totaled $32.9 million for the year ended December 31, 2025 compared to a partial year of amortization expense totaling $9.6 million for the year ended December 31, 2024, an increase of approximately $23.3 million.

These assets were acquired in September 2024 from Alimera.

• We recognized a gain of $31.0 million for the year ended December 31, 2025 related to reductions in contingent consideration liabilities, which are measured at fair value.

These reductions resulted from the adjustment of future forecasted cash flows and the corresponding decrease in expected future payments, including:

(1) a $21.0 million reduction related to the accrued Alimera licensor payments;

(2) a $7.6 million reduction related to the Alimera contingent value rights;

and (3) a $2.6 million reduction in contingent consideration related to the acquisition of Novitium.

• We recognized a loss related to the disposal of certain manufacturing equipment of approximately $0.4 million during the year ended December 31, 2025, and a gain related to the sale of the former Oakville, Ontario manufacturing site of approximately $5.3 million during the year ended December 31, 2024.

• We recognized an impairment charge related to one definite-lived intangible asset of approximately $0.8 million during the year ended December 31, 2025.

We recognized an impairment charge related to a portfolio of definite-lived intangible assets of $3.6 million and IPR&D of approximately $4.0 million during the fourth quarter of 2024.

Other Expense, net

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Interest expense, net (20,060) (17,602) (2,458) 14.0 %

Other expense, net (4,033) (159) (3,874) 2436.5 %

Other income (expense), net 1,934 (4,033) 5,967 (148.0) %

Loss on extinguishment of debt — (7,468) 7,468 (100.0) %

Total other expense, net $ (15,302) $ (22,796) $ 7,494 (32.9) %

For the year ended December 31, 2024 , we recogn ized total other expense, net of $22.8 million as compared to total other expense of $27.1 million for the same period in 2023, a decrease of $4.3 m illion.

• The unrealized gain on investment in equity securities of approximately $6.3 million is due to the mark to market to fair value of the equity securities held in CG Oncology as of the balance sheet date.

There was no comparable gain on investment in the year ended December 31, 2023 .

• Interest expense, for the year ended December 31, 2024 consists primarily of coupon interest expense on borrowings under our outstanding debt and amortization of deferred financings costs on these debt instruments, interest income earned on our bank balances, and interest earned on our interest rate swap.

During 2023 and for the first 8 months of 2024, only the Credit Facility with Truist was outstanding, however, in Q3 2024 we entered into a New Credit Facility and Convertible Senior Notes in an aggregate principal amount of approximately $641.3 million.

The decrease in interest expense, net, of $9.3 million is primarily attributable to favorable interest rates on the New Credit Facility, Convertible Notes, and favorable bank interest rates during 2024.

• Interest expense decreased approximately $2.0 million compared to prior year primarily due to the favorable interest rates on the New Credit Facility.

Interest expense related to our debt during 2024 was $33.6 million, as compared to $35.6 million in the prior year.

• Interest income increased approximately $7.3 million compared to prior year, primarily due to interest and dividends earned on our bank balances and interest rate swap which increased to $16.0 million during 2024 from $8.7 million during 2023.

• Other expense, net, increased to approximately $4.0 million, primarily due to the fees paid to JPMorgan Chase Bank, N.A.

and Blackstone Credit & Insurance of $2.8 million pursuant to the terms of the debt commitment letter, dated June 21, 2024, entered into in connection with the acquisition of Alimera.

• We recorded a loss on debt extinguishment of approximately $7.5 million, comprised of the write-off unamortized deferred financing fee s related to the Credit Facility.

On August 13, 2024, the Company entered into the 2.25% Convertible Senior Notes due 2029 (as described in Note 7 “2.25% Convertible Senior Notes” to the notes to consolidated financial statements).

The proceeds of the Convertible Senior Notes were used to repay the Truist Credit Facility in its entirety, approximately $294.0 million , comprised of $292.5 million of unpaid principal, $1.2 million in accrued and unpaid interest, and $0.3 million of legal fees.

There was no comparable transaction in the year ended December 31, 2023 .

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Income Tax (Benefit) Expense

For the year ended December 31, 2025 , we recognized total other expense, net of $15.3 million as compared to total other expense, net of $22.8 million for the same period in 2024, a decrease of $7.5 million.

• We recorded an unrealized gain on investment in equity securities of approximately $2.8 million for the year ended December 31, 2025, compared to an unrealized gain of $6.3 million in the same period in 2024, which is based on the mark to market fair value of equity securities held in CG Oncology as of the balance sheet date.

• Interest expense, net, for the year ended December 31, 2025 consists primarily of coupon interest expense on borrowings under our outstanding debt and amortization of deferred financings costs on these debt instruments, interest income earned on our bank balances, and interest earned on our interest rate swap.

Interest income earned on our bank balances and interest rate swaps decreased approximately $2.0 million and $1.4 million, respectively.

This impact was partially offset by a decrease in interest expense related to our outstanding debt of approximately $1.1 million, compared to the prior year.

• Other income (expense), net for the years ended December 31, 2025 and 2024 consists primarily of unrealized foreign exchange gains related to our Alimera UK subsidiary.

During 2024, other expense, net primarily consisted of the fees paid to JPMorgan Chase Bank, N.A.

and Blackstone Credit & Insurance of $2.8 million pursuant to the terms of the debt commitment letter, dated June 21, 2024, entered into in connection with the acquisition of Alimera, in addition to foreign exchange losses.

• We recorded a loss on debt extinguishment of approximately $7.5 million, comprised of the write-off of unamortized deferred financing fees related to the Credit Facility during 2024.

On August 13, 2024, the Company entered into the Notes (as described in Note 7 “2.25% Convertible Senior Notes” in the Notes to the Consolidated Financial Statements).

The proceeds of the Notes were used to repay the 2021 Credit Facility in its entirety, approximately $294.0 million, comprised of $292.5 million of unpaid principal, $1.2 million in accrued and unpaid interest, and $0.3 million of legal fees.

There was no comparable transaction during the year ended December 31, 2025.

Income Tax Expense (Benefit)

(in thousands) 2025 2024 Change % Change

Income tax (benefit) expense $ (3,690) $ 1,093 $ (4,783) (437.6) %

Income tax (benefit) expen se consists of current and deferred components, which include changes in our deferred tax assets, our deferred tax liabilities, and our valuation allowance.

Income tax expense (benefit) $ 17,454 $ (3,690) $ 21,144 573.0 %

Income tax expense (benefit) consists of current and deferred components, which include changes in our deferred tax assets, our deferred tax liabilities, and our valuation allowance.

See Note 16 "Income Taxes" in the notes to the consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K for further information.

For the year ended December 31, 2024, we recognized an income tax benefit of a pproximately $3.7 million, an effective tax rate of 16.6% of pre-tax loss reported in the period, as well as the net effect of certain discrete items for the year ended December 31, 2024 which impact our income tax expense in the period in which they occur.

Discrete items occurring in 2024 include the U.S.

federal research and development credit, permanent differences, and stock based compensation.

For the year ended December 31, 2023, we recognized an income tax expense of $1.1 million, an effective rate of 5.5% of pre-tax income reported in the period, as well as the net effects of certain discrete items occurring in 2023 which impact our income tax benefit in the period in which they occur.

There were no material discrete items occurring during the year ended December 31, 2023.

For the year ended December 31, 2025, our income tax expense was approximately $17.5 million.

Our effective tax rate of approximately 18.2% of pre-tax income for the current year was determined based on our pre-tax income, statutory tax rates and the tax impacts of certain items including the UK valuation allowance, the U.S.

federal research and development credit, certain non-deductible items such as contingent consideration and stock based compensation.

For the year ended December 31, 2024, our income tax benefit was approximately $3.7 million.

Our effective tax rate of approximately 16.6% of pre-tax loss or the year ended December 31, 2024 was determined based on our pre-tax loss, statutory tax rates and the tax impacts of certain items including the U.S.

federal research and development credit, certain non-deductible items, and stock based compensation.

Liquidity and Capital Resources

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Inventories 143,067 136,782

Assets held for sale — 8,020

Prepaid income taxes 11,027 772

Prepaid expenses and other current assets 23,189 17,975

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Income taxes payable 1,291 5,622

Income taxes payable - foreign 948 1,899

Returned goods reserve 49,504 39,274

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Total current liabilities $ 278,112 $ 194,452

As of December 31, 2024, we had $144.9 million in unr estricted cash and cash equivalents.

On December 31, 2023, we had $221.1 million in unrestricted cash and cash equivalents.

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We are focused on expanding our business and product pipeline through collaborations, and also through acquisitions of products and companies.

As of December 31, 2025 and 2024 , w e had $285.6 million and $144.9 million, respectively, in unr estricted cash and cash equivalents.

We are focused on expanding our business and product pipeline through acquisitions of products and companies as well as internal research and development.

We are continually evaluating potential asset acquisitions and business combinations.

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Our working capital ratio, defined as total current assets divided by total current liabilities, is 2.7 as of December 31, 2025.

We believe that our financial resources, consisting of net current working capital of approximately $334.0 million, anticipated future operating revenue and corresponding collections from customers, and our New Credit Agreement, under which $75.0 million remains available for borrowing as of December 31, 2024, will be sufficient to enable us to meet our working capital requirements, debt obligations, and other liability obligations for at least the next 12 months from the date of filing of this report, and for the foreseeable future thereafter.

We believe that our financial resources, consisting of net current working capital of approximately $475.0 million, anticipated future operating revenue and corresponding collections from customers, and available borrowings of under our revolving credit facility, of which $74.9 million is available as of December 31, 2025, will be sufficient to enable us to meet our working capital requirements, debt obligations, and other liability obligations for at least the next 12 months from the date of filing of this report, and for the foreseeable future thereafter.

If our assumptions underlying estimated revenue and expenses are wrong, or if our cash requirements change materially as a result of shifts in our business or strategy, we could require additional financing.

If we are not able to continue to be profitable in future years or are not able to continue to generate cash from operations as anticipated and additional capital is needed to support operations, we may be unable to obtain such financing, or obtain it on favorable terms, in which case we may be required to curtail development of new products, limit expansion of operations, or accept financing terms that are not as attractive as desired.

If we are not able to maintain profitability in future years or are not able to continue to generate cash from operations as anticipated and additional capital is needed to support operations, we may be unable to obtain such financing, or obtain it on favorable terms, in which case we may be required to curtail development of new products, limit expansion of operations, or accept financing terms that are not as attractive as desired.

Consolidation among wholesale distributors, chain drug stores, and group purchasing organizations has resulted in a smaller number of companies each controlling a larger share of pharmaceutical distribution channels.

Our net revenues were concentrated among four customers representing 25%, 16%, 12%, and 11% of net revenues during the year ended December 31, 2024.

As of December 31, 2024 accounts receivable from these four customers totaled approximately 70% of accounts receivable, net.

Our net revenues were concentrated among four customers representing 31%, 13%, 13%, and 12% of net revenues during the year ended December 31, 2023.

Our net revenues were concentrated among three customers, which represented 22%, 17%, and 14% of our net revenues during the year ended December 31, 2025.

As of December 31, 2025 accounts receivable from these three customers totaled approximately 64% of accounts receivable, net.

Our net revenues were concentrated among four customers, which represented 25%, 16%, 12%, and 11% of our net revenues during the year ended December 31, 2024.

As of December 31, 2024, accounts receivable from these four customers totaled approximately 70% of accounts receivable, net.

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("Merck") quarterly contingent consideration in the form of a perpetual, tiered royalty expressed as a percentage of Cortrophin Gel net sales.

During the initial two years of commercialization (2022 and 2023) this royalty approximated 10% of net sales.

During 2024, the blended Merck royalty rate was in the upper teens, and we currently anticipate the blended royalty rate to be in in the low 20 percent range in 2025.

In 2025, annual revenues of Cortrophin Gel reached a level by which we surpassed the highest royalty tier for incremental net sales.

To the extent that we achieve higher revenues in future periods, our blended royalty rate will increase.

During 2023, 2024 and 2025, the blended Merck royalty rate approximated 10%, the upper teens, and the low twenties, respectively.

We currently anticipate the blended royalty rate to be in the high twenties in 2026.

Solely for illustrative purpose, if annual net sales were to increase toward one billion dollars, the blended royalty rate would increase into the 30% range.

Sources and Uses of Cash

On August 13, 2024, the Company, as lead borrower, entered into a delayed-draw credit agreement (the “New Credit Agreement”) with JPMorgan Chase Bank, N.A., and other financial institutions (together, the “Lenders”), which provides for aggregate principal commitments consisting of (i) a senior secured term loan facility in an aggregate principal amount of $325.0 million (the “Term Loan A” or “TLA”), and (ii) a senior secured revolving credit facility in an aggregate commitment amount of $75.0 million, which may be used for revolving credit loans, swingline loans and letters of credit (the “TLA Revolver” and together with the TLA, the “New Credit Facility”).

The facilities are secured by a lien on substantially all of the personal property owned by the Company and its material wholly-owned domestic subsidiaries and is guaranteed by all of the Company’s material wholly-owned domestic subsidiaries.

The New Credit Facility matures on the date that is five years following the closing date of the New Credit Agreement, provided that if any of the Notes (defined below) remain outstanding on the date that is 91 days prior to the maturity date of the Notes, the New Credit Facility will mature on such date unless certain terms are met.

At the Company’s option, loans under the New Credit Facility accrue interest at a per annum rate equal to (i) the alternate base rate or (ii) the adjusted term SOFR rate for an interest period of one, three or six months, plus a spread depending on the Company’s first lien net leverage ratio, between 1.25% and 2.00% in the case of ABR loans and between 2.25% and 3.00% in the case of adjusted term SOFR rate loans.

A commitment fee accrues on the unutilized commitments under the TLA Revolver and, from and after the date that is two months after the closing date of the New Credit Agreement, the TLA at a per annum rate equal between 0.25% and 0.40% depending on the Company’s first lien net leverage ratio.

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The New Credit Agreement contains usual and customary representations and warranties of the parties for credit facilities of this type, subject to customary exceptions and materiality standards.

In addition, the Company is required to maintain a first lien net leverage ratio not to exceed 3.00:1.00 (provided, that the lead borrower under the New Credit Agreement may elect to increase the ratio to 3.50:1.00 for four consecutive fiscal quarters following the consummation of a material acquisition) and a minimum interest coverage ratio of 3.00 to 1.00.

The New Credit Agreement also contains certain customary covenants including but not limited to restrictions on the amount of debt the Company and its restricted subsidiaries may incur and payments the Company and its restricted subsidiaries may make, and events of default, as well as, in the event of an occurrence of an event of default, customary remedies for the Lenders, including the acceleration of any amounts outstanding under the New Credit Agreement.

On September 16, 2024 (the “Closing Date”) the Company drew the full $325.0 million of Term Loan A principal on September 16, 2024, with proceeds used to finance the acquisition of Alimera, including fees, costs and expenses incurred in connection with the transaction.

As of December 31, 2024, the TLA Revolver remains undrawn, and $75.0 million is available for borrowing, subject to certain conditions.

The 2024 Credit Facility

On August 13, 2024, the Company, as lead borrower, entered into the 2024 Credit Agreement with JPMorgan Chase Bank, N.A., and other financial institutions (together, the “Lenders”), which provides for aggregate principal commitments consisting of (i) a senior secured term loan facility in an aggregate principal amount of $325.0 million (the “Term Loan A” or “TLA”), and (ii) a senior secured revolving credit facility in an aggregate commitment amount of $75.0 million, which may be used for revolving credit loans, swingline loans and letters of credit (the “TLA Revolver” and together with the TLA, the “2024 Credit Facility”).

The 2024 Credit Facility is secured by a lien on substantially all of the personal property owned by the Company and its material wholly-owned domestic subsidiaries and is guaranteed by all of the Company’s material wholly-owned domestic subsidiaries.

The 2024 Credit Facility matures on the date that is five years following the closing date of the 2024 Credit Agreement, provided that if any of the Notes remain outstanding on the date that is 91 days prior to the maturity date of the Notes, the 2024 Credit Facility will mature on such date unless certain terms are met.

At the Company’s option, loans under the 2024 Credit Facility accrue interest at a per annum rate equal to (i) the alternate base rate or (ii) the adjusted term SOFR rate for an interest period of one, three or six months, plus a spread depending on the Company’s first lien net leverage ratio, between 1.25% and 2.00% in the case of ABR loans and between 2.25% and 3.00% in the case of adjusted term SOFR rate loans.

A commitment fee accrues on the unutilized commitments under the TLA Revolver and, from and after the date that is two months after the closing date of the 2024 Credit Agreement, the TLA at a per annum rate equal between 0.25% and 0.40% depending on the Company’s first lien net leverage ratio.

The 2024 Credit Agreement contains usual and customary representations and warranties of the parties for credit facilities of this type, subject to customary exceptions and materiality standards.

In addition, the Company is required to maintain a first lien net leverage ratio not to exceed 3.00:1.00 (provided, that the Company may elect to increase the ratio to 3.50:1.00 for four consecutive fiscal quarters following the consummation of a material acquisition) and a minimum interest coverage ratio of 3.00 to 1.00.

The 2024 Credit Agreement also contains certain customary covenants including but not limited to restrictions on the amount of debt the Company and its restricted subsidiaries may incur and payments the Company and its restricted subsidiaries may make, and events of default, as well as, in the event of an occurrence of an event of default, customary remedies for the Lenders, including the acceleration of any amounts outstanding under the 2024 Credit Agreement.

On September 16, 2024 the Company drew the full $325.0 million of principal under the Term Loan A and used the proceeds to finance the acquisition of Alimera, including fees, costs and expenses incurred in connection with the transaction.

As of December 31, 2025, $74.9 million is available for borrowing under the TLA Revolver subject to certain conditions.

The TLA and the TLA Revolver mature on September 16, 2029.

The New Credit Facility contains certain contingent acceleration clauses, none of which have been triggered as of December 31, 2024.

The cash interest rate and effective rate under the Term Loan A was approximately 6.98% at December 31, 2024.

The 2024 Credit Facility contains certain contingent acceleration clauses, none of which have been triggered as of December 31, 2025.

The contractual interest rate under the Term Loan A was approximately 6.33% at December 31, 2025.

2.25% Convertible Senior Notes Due 2029

On August 07, 2024, the Company entered into a purchase agreement (the “Purchase Agreement”) with the initial purchasers (the “Initial Purchasers”) relating to the issuance of the $275.0 million aggregate principal amount of the Company's Convertible Senior Notes due 2029 (the “Notes”).

Pursuant to the terms of the Purchase Agreement, the Company granted the Initial Purchasers an option to purchase up to an additional $41.25 million aggregate principal amount of Notes (the “Option”) for settlement at any time during the thirteen days beginning on, and including, August 7, 2024, which Option was exercised in full on August 8, 2024.

On August 7, 2024, the Company entered into a purchase agreement (the “Purchase Agreement”) with the initial purchasers (the “Initial Purchasers”) relating to the issuance of the $275.0 million aggregate principal amount of the e “Notes.” Pursuant to the terms of the Purchase Agreement, the Company granted the Initial Purchasers an option to purchase up to an additional $41.3 million aggregate principal amount of Notes (the “Option”) for settlement at any time during the thirteen days beginning on, and including, August 7, 2024, which Option was exercised in full on August 8, 2024.

On August 13, 2024 (the “Closing Date” or “Issue Date”), the Company completed an offering of $316.25 million aggregate principal amount of Notes.

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The Notes will accrue interest at a rate of 2.25% per annum, payable semi-annually in arrears on March 1 and September 1 of each year, beginning on March 1, 2025.

After payment of the cost of entering into the Capped Call Transactions (as defined below), the Company used the remainder of the net proceeds from the Notes offering, together with cash on hand, to repay the Company’s existing senior secured credit agreement, dated as of November 19, 2021, by and among the Company, certain of the Company’s subsidiaries, as guarantors, Truist Bank, as administrative agent and other parties thereto, as amended, supplemented or otherwise modified from time to time (as amended, the “Credit Agreement”).

After payment of the cost of entering into the Capped Call transactions, the Company used the remainder of the net proceeds from the Notes offering, together with cash on hand, to repay the Company’s 2021 Credit Agreement, dated as of November 19, 2021, by and among the Company, certain of the Company’s subsidiaries, as guarantors, Truist Bank, as administrative agent and other parties thereto, as amended, supplemented or otherwise modified from time to time (as amended, the “2021 Credit Agreement”).

The Notes are the Company’s senior, unsecured obligations and are (i) equal in right of payment with the Company’s existing and future senior, unsecured indebtedness;

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and (iv) structurally subordinated to all existing and future indebtedness and other liabilities, including trade payables, and (to the extent the Company is not a holder thereof) preferred equity, if any, of the Company’s subsidiaries.

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Prior to the close of business on the business day immediately preceding June 1, 2029, holders of the Notes will have the right to convert their Notes only upon the occurrence of certain events as set forth in the Indenture.

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Capped Call Transactions

In connection with the offering of Notes, on August 7, 2024 and August 8, 2024, the Company entered into capped call transactions with certain financial institutions (“Capped Calls”).

In connection with the offering of Notes, on August 7, 2024 and August 8, 2024, the Company entered into Capped Call transactions with certain financial institutions.

The Capped Calls each have an initial strike price of $114.02 , which represents a premium of 100% over the last reported sale price of the Company’s common stock on August 7, 2024.

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The Capped Calls do not meet the criteria for separate accounting as a derivative as they meet the criteria for equity classification, and the capped call transaction premiums are recorded as a reduction to Additional Paid-In Capital within Shareholders’ Equity, net of deferred income taxes.

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Debt Extinguishment

On November 19, 2021, the Company, as borrower, entered into a credit agreement (the “Credit Agreement”) with Truist Bank and other lenders, which provided for credit facilities consisting of (i) a senior secured term loan facility in an aggregate principal amount of $300.0 million (the “Term Facility”) and (ii) a senior secured revolving credit facility in an aggregate commitment amount of $40.0 million, which may be used for revolving credit loans, swingline loans and letters of credit (the “Revolving Facility,” and together with the Term Facility, the “Credit Facility”).

The Credit Facility was secured by substantially all our assets and the assets of our domestic subsidiaries.

On August 13, 2024, the Company entered into the 2.25% Convertible Senior Notes due 2029.

The proceeds of the Convertible Senior Notes were used to repay the Credit Facility in its entirety, approximately $294.0 million, comprised of $292.5 million of unpaid principal, $1.2 million in accrued and unpaid interest, and $0.3 million of legal fees.

In connection with the issuance of the Convertible Senior Notes, the Company recorded a loss on debt extinguishment in the consolidated statement of operations for the year ended December 31, 2024, amounting to approximately $7.5 million, comprised of the write-off unamortized deferred financing fees related to the Credit Facility as of August 13, 2024.

2021 Credit Agreement Debt Extinguishment

The proceeds of the Notes were used to repay the 2021 Credit Agreement with Truist Bank and other lenders, in its entirety, approximately $294.0 million, comprised of $292.5 million of unpaid principal, $1.2 million in accrued and unpaid interest, and $0.3 million of legal fees.

In connection with the issuance of the Notes, the Company recorded a loss on debt extinguishment in the consolidated statement of operations for the year ended December 31, 2024, amounting to approximately $7.5 million, comprised of the write-off unamortized deferred financing fees related to the Credit Facility as of August 13, 2024.

Accrued Licensor Payments

On May 17, 2023, Alimera entered into the Product Rights Agreement with EyePoint which granted Alimera an exclusive and sublicensable right and license under EyePoint’s and its affiliates’ interest in certain of EyePoint’s and its affiliates’ intellectual property to develop, manufacture, sell, commercialize and otherwise exploit certain products, including YUTIQ, for the treatment and prevention of uveitis in the entire world, except Europe, the Middle East and Africa, where the Company already has such rights pursuant to the New Collaboration Agreement, and except for China, Hong Kong, Macau, Taiwan, Brunei, Burma (Myanmar), Cambodia, Timor-Leste, Indonesia, Laos, Malaysia, the Philippines, Singapore, South Korea, Thailand and Vietnam, where Ocumension holds a license from EyePoint.

On May 17, 2023, Alimera entered into the Product Rights Agreement with EyePoint, which granted Alimera an exclusive and sublicensable right and license under EyePoint’s and its affiliates’ interest in certain of EyePoint’s and its affiliates’ intellectual property to develop, manufacture, sell, commercialize and otherwise exploit certain products, including YUTIQ, for the treatment and prevention of uveitis in the entire world, except Europe, the Middle East and Africa, where the Company already has such rights pursuant to the A&R Collaboration Agreement, and except for China, Hong Kong, Macau, Taiwan, Brunei, Burma (Myanmar), Cambodia, Timor-Leste, Indonesia, Laos, Malaysia, the Philippines, Singapore, South Korea, Thailand and Vietnam, where Ocumension holds a license from EyePoint.

Pursuant to the agreement, Alimera paid EyePoint an upfront payment of an upfront payment of $75.0 million and has also made four quarterly guaranteed payments to EyePoint totaling $7.5 million during the year ended December 31, 2024.

The Company will also pay royalties to EyePoint from 2025 to 2028 at a percentage of mid-to-low double digits of annual U.S.

net sales of certain products (including YUTIQ and ILUVIEN) in excess of certain thresholds, beginning at $70.0 million in 2025, increasing annually thereafter.

Upon making the quarterly payments in the aggregate amount of $7.5 million in 2024, the licenses and rights granted to the Company will automatically become perpetual and irrevocable.

Royalties are payable to EyePoint from 2025 to 2028 at 30% of annual U.S.

net sales of certain products (including YUTIQ and ILUVIEN) in excess of certain thresholds, beginning at $70.0 million in 2025, and increasing annually thereafter (the "Accrued Licensor Payments").

There were no payments made in 2025, as the minimum threshold for payment was not met.

Upon making the quarterly payments in the aggregate amount of $7.5 million in 2024, the licenses and rights granted to the Company automatically became perpetual and irrevocable.

Equity Fin ancing

In May 2023, through a public offering, we completed the issuance and sale of 2,183,545 shares of ANI common stock, resulting in net proceeds after issuance costs of approximately $80.6 million, which was used to acquire and invest in additional businesses, technologies, products or assets, to fund our commercialization efforts, including, but not limited to, sales and marketing and consulting expenses related thereto, and for general corporate purposes.

In May 2023, through a public offering, we completed the issuance and sale of 2,183,545 shares of our common stock, resulting in net proceeds after issuance costs of approximately $80.6 million, which was used to acquire and invest in additional businesses, technologies, products or assets, to fund our commercialization efforts, including, but not limited to, sales and marketing and consulting expenses related thereto, and for general corporate purposes.

Our primary cash requirements are to fund operations of the rare disease portion of our Rare Disease and Brands segment, research and development programs and collaborations, to support general and administrative activities, to purchase equipment and machinery to expand our manufacturing capabilities as our product lines grow, and to expand our business and product pipeline through acquisitions of products and companies.

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• business and product acquisitions.

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Discussion of Cash Flows

The following table summarizes the net cash and cash equivalents provided by (used in) operating activities, investing activities, and financing activities for the periods indicated:

The following table summar izes the net cash and cash equivalents provided by (used in) operating activities, investing activities, and financing activities for the periods indicated:

Year Ended December 31,

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Financing Activities $ (9,944) $ 264,945

Net Cash Provided by Operations

Net cash provided by operating activities was $64.0 million for the year ended December 31, 2024, compared to $119.0 million used in operating activities during the same period in 2023, a decrease of $54.9 million.

The decrease in cash provided by operating activities primarily resulted from our net loss of $18.5 million adjusted for non-cash items, and an increase in working capital driven by the growth of our business, resulting in incremental accounts receivable and inventory.

Net Cash Provided by Op erations

Net cash provided by operating activities was $185.2 million for the year ended December 31, 2025, compared to net cash provided by operating activities of $64.0 million during the same period in 2024, an increase of $121.2 million.

The increase in cash provided by operating activities primarily resulted from our net income of $78.3 million adjusted for non-cash items, and an increase in our working capital accounts driven by the growth of our business.

Net Cash Used in Investing Activities

Net cash used in investing activities for the year ended December 31, 2025 was $34.3 million, principally due to the payment for the exercise of the Buy-Out Option and purchase of other intangible assets of approximately $20.5 million and capital expenditures of approximately $13.8 million.

Net cash used in investing activities for the year ended December 31, 2024 was $404.7 million, principally due to the acquisition of Alimera of approximately $401.3 million and capital expenditures of approximately $16.2 million.

These cash outflows were offset by proceeds received from the sale of Oakville, Ontario manufacturing site in March 2024 of approximately $13.5 million.

Net cash used in investing activities for the year ended December 31, 2023 was $18.5 million, principally due to $8.9 million of capital expenditures and the consideration paid for asset acquisitions of ANDAs and other product rights totaling $9.6 million.

Net Cash Provided by Financing Activities

Net cash provided by financing activities was $264.9 million for the year ended December 31, 2024, principally resulting from proceeds from the New Credit Facility of $325.0 million, proceeds from the offering of the Convertible Senior Notes of $316.3 million, tempered by the repayment of the Truist Credit Facility of $292.5 million, purchase of the capped calls of $40.6 million, payments of debt issuance costs related to the Convertible Senior Notes and New Credit Facility of $17.4 million, $12.5 million paid the the Company Members of Novitium, and $11.0 million of treasury stock purchase, and other items.

Net cash provided by financing activities for the year ended December 31, 2023 was $67.4 million, principally due to the $80.6 million in net proceeds from the May 2023 public offering and $9.0 million from proceeds from stock option exercises and ESPP purchases.

This was offset by cash used in financing activities related to $12.5 million to Company Members of Novitium, $3.0 million maturity payments on the Term Facility, $5.0 million of treasury stock purchased in relation to restricted stock vests, and $1.6 million convertible preferred stock dividends paid.

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Net Cash (Used in) Provided by Financing Activities

Net cash used in financing activities w as $9.9 million for the year ended December 31, 2025, principally resulting from $12.2 million of treasury stock purchases for restricted stock vesting events, principal payments on our 2024 Credit Facility of $10.2 million, offset by proceeds received from stock option exercises and ESPP purchases of approximately $13.6 million.

Net cash provided by financing activities for the year ended December 31, 2024 was $264.9 million, princip ally resulting from proceeds from the 2024 Credit Facility of $325.0 million, proceeds from the offering of the Notes of $316.3 million, tempered by the repayment of the 2021 Credit Facility of $292.5 million, purchase of the capped calls of $40.6 million, payments of debt issuance costs related to the Notes and 2024 Credit Facility of $17.4 million, $12.5 million paid the Company Members of Novitium, and $11.0 million of treasury stock purchase, and other items.

Contractual Obligations

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Our contractual obligations and commitments as of December 31, 2025 are comprised of principal payments on debt, interest payments on debt, operating leases, purchase obligations, dividends, and contingent consideration.

New Credit Agreement

2024 Credit Agreement

Our largest contractual obligation relates to our principal payments on our interest payments on our debt.

As of December 31, 2024 , the principal amount of our New Credit Agreement was approximately $323.0 million .

As of December 31, 2025 , the outstanding principal under our 2024 Credit Agreement was approximately $312.8 million.

The cash interest rate under the Term Loan A was approximately 6.33% at December 31, 2025.

See Note 6 "New Credit A greement" in the notes to the consolidated financial statements in Part II, Item 8.

See Note 6 "2024 Credit Agreement" in the notes to the consolidated financial statements in Part II, Item 8.

of this Annual Report on Form 10-K for additional information and timing on our principal payments on debt.

An interest rate swap is used to manage changes in SOFR-based variable interest rates underlying a portion of the borrowing under the New Credit Agreement.

An interest rate swap is used to manage changes in SOFR-based variable interest rates underlying a portion of the borrowing under the 2024 Credit Agreement.

Pursuant to the terms of the swap agreement, ANI pays the counterparty an effective fixed rate of 2.313%.

As of December 31, 2025, the notional value of the interest rate swap was $139.4 million.

See Note 8 "Derivative Financial Instruments and Hedging Activity" in the notes to the consolidated financial statements in Part II, Item 8.

See Note 8 "Derivative Financial Ins truments and Hedging Activity" in the notes to the consolidated financial statements in Part II, Item 8.

of this Annual Report on Form 10-K for additional information.

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On August 13, 2024, the Company completed an offering of $316.25 million aggregate principal amount of Notes.

The Notes were issued pursuant to an indenture (the “Indenture”) dated as of August 13, 2024 between the Company and U.S.

Bank Trust Company, National Association (“Trustee”).

The Notes were issued pursuant to the Indenture dated as of August 13, 2024 between the Company and the Trustee.

The Notes are due September 1, 2029, unless earlier repurchased, redeemed, or converted.

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of this Annual Report on Form 10-K for additional information and timing on our principal payments on debt.

Our operating leases are primarily for warehouse, office space, and office equipment.

Our leases are primarily operating leases for warehouse, office space, and office equipment.

As leases expire, we do not anticipate difficulty in negotiating renewals or finding other satisfactory space if the premise becomes unavailable.

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of this Annual Report on Form 10-K for additional discussion and timing of payments related to these operating lease obligations.

Our convertible preferred stock (“PIPE Shares”) accrue dividends at 6.50% per year on a cumulative basis, payable in cash or in-kind.

Dividends are payable until the preferred stock is converted, either at the option of the PIPE investor, at any time, or the option of ANI, beginning two years after the November 19, 2021 issuance provided ANI’s stock price reaches a certain level.

See Note 13 "Mezzanine and Stockholders’ Equity" in the notes to the con solidated financial statements in Part II, Item 8.

Our PIPE Shares accrued dividends at 6.50% per year on a cumulative basis, payable in cash or in-kind.

During the third quarter of 2025, all of the PIPE Shares were converted into shares of the Company, and as such, no dividends were payable in the fourth quarter of 2025 or in the future.

See Note 13 "Mezzanine and Stockholders’ Equity" in the notes to the consolidated financial statements in Part II, Item 8.

of this Annual Report on Form 10-K for additional discussion of dividends.

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Novitium Contingent Consideration

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The contingent consideration is based on the achievement of certain milestones, including milestones on gross profit of Novitium portfolio products over a 24-month period, regulatory filings completed during this 24-month period, and a percentage of net profits on certain products that are launched in the future.

Pursuant to the terms of the Novitium Agreement and Plan of Merger, dated as of March 8, 2021, on December 12, 2023, the Company paid $12.5 million of cash consideration to the Company Members, defined as the holders of Novitium ownership interests in the Agreement and Plan of Merger, of Novitium for the achievement of the "ANDA Filing Earn-Out," as defined in the Agreement .

Pursuant to the terms of the Novitium Merger Agreement, the Company paid $12.5 million of cash consideration to the Company Members for the achievement of the ANDA Filing Earn-Out.

On February 22, 2024, the Company paid $12.5 million to Novitium related to the achievement of the milestone.

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of this Annual Report on Form 10-K for additional information on our contingent consideration.

Pursuant to the terms of the Novitium Merger Agreement, the Company owes 20% of net profit generated by sales of certain 505(b)(2) Products, to the Company Members.

The payments are due on a quarterly basis, within 45 calendar days of each quarter end, until the earlier to occur of (i) the sum of all such payments being equal to $21.5 million in the aggregate and (ii) the tenth anniversary of FDA approval of the applicable 505(b)(2) Product (the "505(b)(2) Earn-Out").

During the year ended December 31, 2025, the Company paid approximately $26 thousand for payment of the 505(b)(2) Earn-Out to the Company Members.

Alimera Contingent Value Rights

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The fair value of the contingent value rights as of December 31, 2025 was approximately $1.4 million .

Se e Note 3 and Note 12 "Business Combination" and "Fair Value", respectively, in the notes to the consolidated financial statements in Part II, Item 8.

See Note 3 and Note 12 "Business Combination" and "Fair Value," respectively, in the notes to the consolidated financial statements in Part II, Item 8.

of this Annual Report on Form 10-K for additional information on the contingent consideration.

Accrued Licensor Payments

The Company will also pay royalties to EyePoint from 2025 to 2028 at a percentage of mid-to-low double digits of annual U.S.

net sales of certain products (including YUTIQ and ILUVIEN) in excess of certain thresholds, beginning at $70.0 million in 2025, increasing annually thereafter.

Upon making the quarterly payments in the aggregate amount of $7.5 million in 2024, the licenses and rights granted to the Company will automatically become perpetual and irrevocable.

The present value of the remaining payments to EyePoint for years 2025 to 2028 will continue to be revalued at an appropriate discount rate for the Company at each reporting date until they are settled.

The fair value of the remaining future payments as of December 31, 2024 was approximately $21.0 million.

Se e Note 12 "Fair Value" in the notes to the consolidated financial statements in Part II, Item 8.

The Company will also pay royalties to EyePoint from 2025 to 2028 at 30% of annual U.S.

net sales of certain products (including YUTIQ and ILUVIEN) in excess of certain thresholds, beginning at $70.0 million in 2025, and increasing annually thereafter.

Upon making the quarterly payments in the aggregate amount of $7.5 million in 2024, the licenses and rights granted to the Company automatically became perpetual and irrevocable.

The present value of the remaining payments to EyePoint for years 2026 to 2028 will continue to be revalued at an appropriate discount rate for the Company at each r eporting date until they are settled.

The fair value of the remaining future payments as of December 31, 2025 was zero.

See Note 12 " Fair Value" in the notes to the consolidated financial statements in Part II, Item 8.

of this Annual Report on Form 10-K for additional information on the licensor payments.

We expect to continue to incur significant expenditures in support of our commercial launch of Cortrophin, including costs related to service contracts and increased headcount.

We expect to continue to incur significant expenditures in support of our commercial launch of Cortrophin Gel, including costs related to service contracts and increased headcount.

Critical Accounting Estimates

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Our significant accounting policies are discussed in Note 1, "Description of Business and Summary of Significant Accounting Policies" of the Notes to the consolidated financial statements in Part II, Item 8.

of this Form 10-K describes the significant accounting policies and methods used in the preparation of the Company's consolidated financial statements.

of this Annual Report on Form 10-K describes the significant accounting policies and methods used in the preparation of the Company's consolidated financial statements.

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

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Revenue is recognized when our obligations under the terms of our contracts with customers are satisfied, which generally occurs when control of the products we sell is transferred to the customer.

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Variable consideration is estimated after the consideration of applicable information that is reasonably available.

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If actual results were not consistent with our estimates, the Company could be exposed to losses or gains that could be material, as changes to chargeback estimates could cause an increase or decrease in revenue recognized during the year and increase or decrease accounts receivable.

If there were a 1% change in the chargeback estimates throughout the year, our net revenues would be affecte d by $5.8 million for the year ended December 31, 2024.

If there were a 1% change in the chargeback estimates throughout the year, our net revenues would be affected by $6.8 million for the year ended December 31, 2025.

Government Rebates

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If there were a 10% decrease in the prompt payment discounts estimates throughout the year, our net revenues would increase by $3.6 million for the year ended December 31, 2025.

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Impairment of Goodwill and Intangible Assets

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Changes in these estimates and assumptions could materially affect the determination of fair value and goodwill impairment for each reporting unit.

The carrying value of goodwill at December 31, 2024 was approximately $60.0 million.

As part of the Novitium acquisition on November 19, 2021, we acquired goodwill of $24.6 million in the Generics and Other reporting unit.

The carrying value of goodwill at December 31, 2025 was approxi mately $62.5 million.

As part of the Novitium acquisition on November 19, 2021, we acquired goodwill of $24.6 million in the Gen erics and Other reporting unit.

As a result of the acquisition of Alimera, on September 16, 2024, the Company recorded goodwill of $34.3 million in the Rare Disease reporting unit.

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If the carrying amount of an intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess.

We consider many factors in evaluating whether the value of its intangible assets with indefinite lives may not be recoverable, including, but not limited to the discount rate, terminal growth rates, general economic conditions, our outlook and market performance of our industry and recent and forecasted financial performance.

We recognized approximately $0.8 of impairment charges during the year ended December 31, 2025, related to one product for which the Company has ceased commercialization.

We recognized an impairment loss of $4.0 million during the three months ended December 31, 2024 related to IPR&D which was acquired as part of the Novitium acquisition during 2021, and also recorded an impairment loss of $3.6 million on a basket of definite-lived intangible assets.

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Contingent Consideration

Accrued Licensor Payments

The terms of the Product Rights Agreement between the Company and EyePoint include the potential payment of future consideration that is contingent upon the achievement o f annual U.S.

The terms of the Product Rights Agreement between the Company and EyePoint include the potential payment of future consideration that is contingent upon the achievement of annual U.S.

net sales of certain products (including YUTIQ and ILUVIEN) in excess of certain thresholds, beginning at $70 million in 2025, increasing annually thereafter.

The fair value of the Accrued Licensor Payments was approximately $21.0 million at December 31, 2024.

The fair value of the Accrued Licensor Payments was zero at December 31, 2025.

Significant inputs used in the measurement of the fair value include discount rates and probabilities of achievement of net revenue.

Changes in fair value, which incorporate changes in assumptions and the passage of time, are recognized as an operating expense in the consolidated statements of operations.

These changes resulted in a decrease of the fair value of the liability of approximately $21.0 milli on during the year ended December 31, 2025, as no further payments are anticipated to be made in fiscal 2026 to 2028.

Novitium Contingent Consideration

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The fair value of contingent consideration is remeasured to the estimated fair value each reporting period with the change recognized as an operating expense in our consolidated statements of operations.

Changes in fair value can result from changes in assumptions such as discount rates, probabilities or estimates of revenue and profits, and probability of achieving regulatory milestones, as well as the passage of time.

These changes resulted in a decrease of the fair value of the liability of approximately $0.6 million and an increase of the fair value of the liability of $1.4 million during the years ended December 31, 2024 and 2023, respectively.

Changes in fair value can result from changes in assum ptions such as discount rates, probabilities or estimates of revenue and profits, and probability of achieving regulatory milestones, as well as the passage of time.

These changes resulted in a decrease of the fair value of the liability of approximately $2.6 milli on during the year ended December 31, 2025.

Alimera Contingent Value Rights

The fair value of the Alimera Contingent Value Rights c onsideration was $9.0 million at December 31, 2024.

The fair value of the Alimera Contingent Value Rights c onsideration was $1.4 million and $9.0 million at December 31, 2025 and 2024, respectively.

The fair value of Alimera Contingent Value Rights is remeasured to the estimated fair value each reporting period with the change recognized as an operating expense in our consolidated statements of operations.

Changes in fair value can result from changes in assumptions such as discount rates, probabilities or estimates of future revenue and profits, as well as the passage of time.

These changes resulted in charges of $0.3 million during the year ended December 31, 2024.

These changes resulted in a gain recognized in our consolidated statement of operations of $7.6 million during the year ended December 31, 2025.

Stock-Based Compensation

Stock-based compensation c ost for stock options is determined at the grant date using an option pricing model and stock-based compensation cost for restricted stock is based on the closing market price of the stock at the grant date.

The value of the award is recognized as expense on a straight-line basis over the employee’s requisite service period.

The value of the awards and units are recognized as expense on a straight-line basis over the employee’s requisite service period.

Awards may also be issued in the form of Performance Stock Units (“PSUs”) to certain employees of the Company.

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Changes in these assumptions can affect the fair value estimate.

The following table summarizes stock-based compensation and ESPP expense included in our consolidated statements of operations:

The following table summarizes stock-based compensation expense incurred for ESPP, stock options, restricted stock awards, restricted stock units, performance-based restricted stock units, and Inducement grants included in our consolidated statements of operations:

(in thousands) Years Ended December 31,

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$ 37,929 $ 29,344 $ 20,652

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Stock-based compensation cost for stock options is determined at the grant date using an option pricing model and stock-based compensation cost for restricted stock is based on the closing market price of the stock at the grant date.

The value of the award is recognized as expense on a straight-line basis over the employee’s requisite service period.

Valuation of stock awards requires us to make assumptions and to apply judgment to determine the fair value of the awards.

The value of the awards and units are recognized as expense on a straight-line basis over the employee’s requisite service period.

Valuation of stock awards and units require us to make assumptions and to apply judgment to determine the fair value of the awards.

These assumptions and judgments include estimating the future volatility of our stock price and dividend yields.

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Changes in estimates could affect compensation expense within individual periods.

If there were to be a 10% change in our stock-based compensation expense for the year, our (Loss) Income Before (Benefit) Expense for Income Taxes would be affected by $2.9 million for the year ended December 31, 2024.

If there were to be a 10% change in our stock-based compensation expense for the year, our Income (Loss) Before Expense (Benefit) for Income Taxes would be affected by $3.8 million for the year ended December 31, 2025.

The Company uses the asset and liability method of accounting for income taxes.

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The Company is subject to taxation in various U.S.

jurisdictions, Canada, India, the United Kingdom, Ireland, Portugal, and Germany and all of its income tax returns remain subject to examination by tax authorities due to the availability of net operating loss carryforwards.

jurisdictions, Canada, India, the UK, Ireland, Portugal, and Germany and all of its income tax returns remain subject to examination by tax authorities due to the availability of net operating loss carryforwards.

To the extent the Company is required to pay amounts in excess of our established liability, our effective income tax rate in a given financial statement period could be materially affected.

An unfavorable tax settlement generally would require use of our cash and may result in an increase in our effective income tax rate in the period of resolution.

The Company considers potential tax effects resulting from discontinued operations and gains and losses included in other comprehensive (loss) income and record intra-period tax allocations, when those effects are deemed material.

The Company considers potential tax effects resulting from discontinued operations and gains and losses included in other comprehensive income (loss) and record intra-period tax allocations, when those effects are deemed material.

Our effective income tax rate is also affected by changes in tax law, our level of earnings, and the results of tax audits.

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of this Form 10-K.

Ta b l e of Contents

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