What changed in this filing

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Item 9A. Controls and Procedures

2025-02-27 compared with 2024-02-22 · 475 added, 290 removed, 1260 unchanged (38% of the section changed)

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Internal control over financial reporting also can be circumvented by collusion or improper management override.

Also, projections of any evaluation of effectiveness of internal control over financial reporting to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate.

Because of such limitations, there is a risk that material misstatements may not be prevented

or detected on a timely basis by internal control over financial reporting.

procedures may deteriorate.

Because of such limitations, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting.

However, these inherent limitations are known features of the financial reporting process.

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Management has used the framework set forth in the report entitled “Internal Control—Integrated Framework (2013)” published by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) to evaluate the effectiveness of our internal control over financial reporting.

Based on our evaluation, Management has concluded that our internal control over financial reporting was effective as of December 31, 2023.

As permitted by SEC guidance, management may omit an assessment of a newly acquired operation’s internal control over financial reporting for up to one year from the date of acquisition.

Accordingly, we excluded the portion of Ironshore’s operations that represented approximately 8.5% of total operating expenses for the year ended December 31, 2024 from management’s assessment of internal control over financial reporting.

Based on our evaluation, and subject to the exclusion above, management has concluded that our internal control over financial reporting was effective as of December 31, 2024.

Changes in Internal Control Over Financial Reporting

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We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2024, of the Company and our report dated February 27, 2025, expressed an unqualified opinion on those financial statements.

As described in Management’s Report on Internal Control Over Financial Reporting, management excluded from its assessment the internal control over financial reporting at Ironshore Therapeutics Inc., which was acquired on September 3, 2024, and whose financial statements constitute 8.5% of the consolidated operating expenses for the year ended December 31, 2024.

Accordingly, our audit did not include the internal control over financial reporting at Ironshore Therapeutics Inc.

Basis for Opinion

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(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the

financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

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Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required by this Item 12 is incorporated herein by reference from our definitive proxy statement for the 2024 Annual Meeting of Shareholders under the captions “Compensation Discussion and Analysis,” “Executive Compensation” (excluding the information under the heading “Pay Versus Performance”), “Director Compensation” and “Compensation Committee Report.”

The information required by this Item 12 is incorporated herein by reference from our definitive proxy statement for the 2025 Annual Meeting of Shareholders under the captions “Security Ownership of Certain Beneficial Owners and Management” and “Securities Authorized for Issuance Under Equity Compensation Plans.”

Certain Relationships and Related Transactions, and Director Independence

The information required by this Item 13 is incorporated herein by reference from our definitive proxy statement for the 2024 Annual Meeting of Shareholders under the captions “Compensation Discussion and Analysis,” “Executive Compensation” (excluding the information under the heading “Pay Versus Performance”), “Director Compensation” and “Compensation Committee Report.”

The information required by this Item 13 is incorporated herein by reference from our definitive proxy statement for the 2025 Annual Meeting of Shareholders under the captions “Certain Relationships and Related Party Transactions” and “Election of Directors – Director Independence.”

Principa l Accountant Fees and Services

The information required by this Item 14 is incorporated herein by reference from our definitive proxy statement for the 2024 Annual Meeting of Shareholders under the captions “Compensation Discussion and Analysis,” “Executive Compensation” (excluding the information under the heading “Pay Versus Performance”), “Director Compensation” and “Compensation Committee Report.”

The information required by this Item 14 is incorporated herein by reference from our definitive proxy statement for the 2025 Annual Meeting of Shareholders under the captions “Ratification of Appointment of Independent Registered Public Accounting Firm - Independent Registered Public Accountants’ Fees” and “Ratification of Appointment of Independent Registered Public Accounting Firm – Pre-Approval Policies and Procedures.”

Exhibits and Financial Statement Schedules

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and BioDelivery Sciences International, Inc.

Agreement and Plan of Merger, dated as of July 28, 2024, by and among Collegium Pharmaceutical Inc., Ironshore Therapeutics Inc.

and Shareholder Representative Services LLC

Third Amended and Restated Articles of Incorporation of Collegium Pharmaceutical, Inc.

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Form of Indemnification Agreement.

Amended & Restated Employment Agreement, dated December 27, 2020, by and between Collegium Pharmaceutical, Inc.

and Joseph Ciaffoni.

Amended & Restated Employment Agreement, dated December 27, 2020, by and between Shirley Kuhlmann and Collegium Pharmaceutical, Inc.

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Employment Agreement, dated May 24, 2021, by and between Colleen Tupper and Collegium Pharmaceutical, Inc.

Amended and Restated Loan Agreement, dated as of March 22, 2022, by and among Collegium Pharmaceutical, Inc., the guarantors party thereto, BioPharma Credit PLC, and BioPharma Credit Investments V (Master) LP, as lenders.

First Amendment and Consent to Amended and Restated Loan Agreement, dated as of January 3, 2023, by and among Collegium Pharmaceutical, Inc., the guarantors party thereto, BioPharma Credit PLC, and BioPharma Credit Investments V (Master) LP, as lenders.

Second Amendment to Loan Agreement, dated as of February 6, 2023, Amended and Restated Loan Agreement, dated as of March 22, 2022, by and among Collegium Pharmaceutical, Inc., the guarantors party thereto, BioPharma Credit PLC, and BioPharma Credit Investments V (Master) LP, as lenders.

Third Amendment to Loan Agreement, dated as of June 23, 2023, by and among Collegium Pharmaceutical, Inc., the guarantors party thereto, BioPharma Credit PLC, and Bio Pharma Credit Investments V (Master) LP, as lenders.

Second Amended and Restated Loan Agreement by and among Collegium Pharmaceutical Inc., its subsidiaries party thereto;

BioPharma Credit PLC, as collateral agent and lender;

BPCR Limited Partnership, and BioPharma Credit Investments V (Master) LP, as lender, dated as of July 28,2024.

Separation Agreement, by and between Collegium Pharmaceutical Inc.and Joseph Ciaffoni, dated May 24, 2024.

Authorized Generic Agreement by and between Collegium Pharmaceutical Inc.and Hikma Pharmaceuticals USA Inc., dated April 26, 2024.

Exclusive License Agreement, dated April 4, 2019, between the Company and Shionogi, Inc.

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Amendment to Employment Agreement, dated January 20, 2022 by and between Collegium Pharmaceutical, Inc.

and Joseph Ciaffoni.

Amendment to Employment Agreement, dated January 20, 2022 by and between Collegium Pharmaceutical, Inc.

and Colleen Tupper.

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and Thomas Smith.

Employment Agreement, dated November 12, 2024 by and between Collegium Pharmaceutical, Inc.

and Vikram Karnani.

Insider Trading Policy

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(1) Previously filed as an exhibit to the registrant’s Current Report on Form 8-K filed with the SEC on February 14, 2022.

(2) Previously filed as an exhibit to the registrant’s Current Report on Form 8-K filed with the SEC on July 29, 2024.

(3) Previously filed as an exhibit to the registrant’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2020 filed with the SEC on August 5, 2020.

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333-203208) filed with the SEC on April 27, 2015.

(11) Previously filed as an exhibit to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on February 22, 2024.

(12) Previously filed as an exhibit to the registrant’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2019 filed with the SEC on May 8, 2019.

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(16) Previously filed as an exhibit to the registrant’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2021 filed with the SEC August 5, 2021.

(15) Previously filed as an exhibit to the registrant’s Current Report on Form 8-K filed with the SEC on March 23, 2022.

(16) Previously filed as an exhibit to the registrant’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2023 filed with the SEC May 4, 2023.

(17) Previously filed as an exhibit to the registrant’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2023 filed with the SEC August 3, 2023.

(17) Previously filed as an exhibit to the registrant’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2024 filed with the SEC on August 8, 2024.

(18) Previously filed as an exhibit to the registrant’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2022 filed with the SEC May 10, 2022.

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COLLEGIUM PHARMACEUTICAL, INC.

/s/ Joseph Ciaffoni

Joseph Ciaffoni

/s/ Vikram Karnani

Vikram Karnani

Chief Executive Officer

/s/ Joseph Ciaffoni

/s/ Vikram Karnani

President and Chief Executive Officer (Principal Executive Officer) and Director

February 27, 2025

Joseph Ciaffoni

Vikram Karnani

/s/ Colleen Tupper

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February 27, 2025

/s/ Neil McFarlane

/s/ Nancy Lurker

February 27, 2025

Neil McFarlane

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed by the following persons in the capacities and on the dates indicated.

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We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Revenue Recognition – Product Return Liability– Refer to Note 3 to the Financial Statements

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At the end of each reporting period, the Company updates the estimated transaction price (including updating its assessment of whether an estimate of variable consideration should be constrained).

Variable consideration, including the risk of customer concessions, is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty is subsequently resolved.

The Company updates the measurement of the refund liability at the end of each reporting period for changes in expectations about the amount of refunds with the corresponding adjustments recognized as revenue (or reductions of revenue).

Estimating the variable consideration and the provision for the refund liability requires significant judgment by management.

Given the complexity and significant level of estimation uncertainty involved in calculating the refund liability, our audit procedures in this area required a high degree of auditor judgment and an increased extent of effort.

Variable consideration, including the risk of customer concessions, is included in

the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty is subsequently resolved.

The Company updates the measurement of the returns and the refund liability (the “return provision”) at the end of each reporting period for changes in expectations about the amount of refunds with the corresponding adjustments recognized as revenue (or reductions of revenue).

Estimating the return provision requires significant judgment by management.

Given the complexity and significant level of estimation uncertainty involved in calculating the return provision, our audit procedures in this area required a high degree of auditor judgment and an increased extent of effort.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the revenue deductions for returns and the refund liability (the “return provision”) included the following, among others:

Our audit procedures related to the return provision included the following, among others:

● We tested the effectiveness of controls over the measurement and recognition of the return provision.

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● We developed independent estimates of the return provision using historical sales and returns activity, product dating and expiration dates, and other information.

Business Combinations - Refer to Note 4 to the financial statements

Critical Audit Matter Description

During the year ended December 31, 2024, the Company acquired Ironshore Therapeutics Inc.

(“Ironshore”) for total consideration of $309.9 million.

The assets acquired and liabilities assumed were recorded based on their fair value, including an intangible asset and a deferred royalty obligation of $635.0 million and $116.9 million, respectively.

Management estimated the fair value of the asset and liability using valuation techniques, including income-based models, which required the use of significant estimates and assumptions related to future cash flows and the selection of appropriate discount rates.

We identified the valuation of the intangible asset and deferred royalty obligation as a critical audit matter.

Given that the determination of the fair value requires significant estimates and assumptions by management, performing audit procedures to evaluate the reasonableness of these estimates and assumptions required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the estimated future cash flows and the selection of the discount rates for the intangible asset and deferred royalty obligation included the following, among others:

● We tested the effectiveness of controls over the valuation of the intangible asset and deferred royalty obligation, including management's controls over the underlying revenue forecasts, future profit margins, and selection of the discount rates.

● We assessed the reasonableness of management's revenue and profit margin forecasts underlying the forecasted cash flows by performing the following:

o We compared the forecasts to historical results of the acquired business.

o We compared the forecasts to internal forecasts and other information obtained while performing the audit.

o We performed a sensitivity analysis to determine the impact of the assumptions under different scenarios.

o We compared the revenue growth rates to available external information.

● With the assistance of our fair value specialists, we performed the following:

o We evaluated the reasonableness of the valuation methodologies selected and the mathematical accuracy of the calculations.

o We tested the source information underlying the determination of the discount rates, tested the mathematical accuracy of the calculations and compared those to the amounts selected by management.

/s/ Deloitte & Touche LLP

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Prepaid expenses and other current assets

Restricted cash

Total current assets

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Current portion of operating lease liabilities

Business combination consideration payable

Total current liabilities

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Operating lease liabilities, net of current portion

Deferred royalty obligation

Deferred revenue

Contingent consideration

Total liabilities

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Selling, general and administrative

Restructuring

Gain on fair value remeasurement of contingent consideration

Total operating expenses

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Other comprehensive income:

Unrealized gains on marketable securities

Unrealized gains on marketable securities, net of tax

Total other comprehensive income

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Balance as of December 31, 2021

Cumulative effect of adjustment for adoption of ASU 2020-06

( 2,150,717 )

Exercise of common stock options

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( 1,085,106 )

Forward contract on ASR agreement

Exercise of warrant

Stock-based compensation

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( 3,088,069 )

Exercise of warrant

Stock-based compensation

Other comprehensive income, net of tax

Balance as of December 31, 2023

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Non-cash interest expense for amortization of debt discount and issuance costs

Non-cash interest expense for deferred royalty obligation

Net amortization of premiums and discounts on investments

Non-cash change in fair value of contingent consideration

Changes in operating assets and liabilities:

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Investing activities

Acquisition of Ironshore (net of cash acquired)

Acquisition of BDSI (net of cash acquired)

Purchases of property and equipment

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Maturities of marketable securities

Acquisition of BDSI (net of cash acquired)

Net cash used in investing activities

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Repayment of term notes

Proceeds from term note modification

Proceeds from term note modification, net of fees paid to lender of $ 11,825

Proceeds from issuances of 2029 convertible notes, net of issuance costs of $ 6,280

Repurchase of 2026 Convertible Notes, including premium

Redemption of 2026 Convertible Notes, including premium and redemption costs

Repayment of assumed debt from Ironshore acquisition

Net cash (used in) provided by financing activities

Net increase (decrease) in cash, cash equivalents and restricted cash

Net (decrease) increase in cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash at beginning of year

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Excise tax on share repurchases in accrued liabilities

Inventory used in the construction and installation of property and equipment

Acquisition date fair value of contingent consideration

Business combination consideration payable

The accompanying notes are an integral part of these consolidated financial statements.

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The Company has its principal operations in Stoughton, Massachusetts.

The Company’s mission is to build a leading, diversified specialty pharmaceutical company committed to improving the lives of people living with serious medical conditions.

The Company’s portfolio includes Xtampza ER, Nucynta ER and Nucynta IR (collectively the “Nucynta Products”), Belbuca, and Symproic.

The Company’s mission is to build a leading, diversified biopharmaceutical company committed to improving the lives of people living with serious medical conditions.

The Company’s product portfolio includes Jornay PM (“Jornay”), Belbuca, Xtampza ER, Nucynta ER and Nucynta IR (collectively the “Nucynta Products”), and Symproic.

On September 3, 2024, (the “Acquisition Date”), the Company closed its acquisition of Ironshore Therapeutics Inc.

(“Ironshore”) (the “Ironshore Acquisition” or “Merger”) pursuant to an Agreement and Plan of Merger (the “Merger Agreement”), with Ironshore surviving the Merger as a wholly owned subsidiary of the Company.

Ironshore had developed and obtained commercial approval to market Jornay in the United States.

Upon closing the Ironshore Acquisition, the Company acquired the Jornay product.

On March 22, 2022, the Company acquired BioDelivery Sciences International, Inc.

(“BDSI”), a specialty pharmaceutical company working to deliver innovative therapies for individuals living with serious and debilitating chronic conditions (the “BDSI Acquisition”).

Upon closing the BDSI Acquisition, the Company acquired the Belbuca and Symproic products.

The Company’s operations are subject to certain risks and uncertainties.

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The consolidated financial statements include the accounts of Collegium Pharmaceutical, Inc.

as well as the accounts of its subsidiaries Collegium Securities Corporation (a Massachusetts corporation), Collegium NF LLC (a Delaware limited liability company), BioDelivery Sciences International, Inc.

(a Delaware corporation), Arius Pharmaceuticals, Inc.

(a Delaware corporation), and Arius Two, Inc.

(a Delaware corporation), all wholly owned subsidiaries requiring consolidation.

as well as the accounts of its subsidiaries.

The consolidated financial statements are prepared in conformity with generally accepted accounting principles in the United States of America (“GAAP”).

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The preparation of the consolidated financial statements in accordance with GAAP requires the Company to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues, costs and expenses and the disclosure of contingent assets and liabilities in the Company’s consolidated financial statements and accompanying notes.

Estimates in the Company’s consolidated financial statements include revenue recognition, including the estimates of product returns, discounts and allowances related to commercial sales of products, estimates related to the fair value of assets acquired and liabilities assumed, including acquired intangible assets and the fair value of inventory acquired, estimates utilized in the ongoing valuation of inventory related to potential unsalable product, estimates of useful lives with respect to intangible assets, accounting for stock-based compensation, contingencies, impairment of intangible assets and deferred tax valuation allowances.

Estimates in the Company’s consolidated financial statements include revenue recognition, including the estimates of product returns, discounts and allowances related to commercial sales of products, estimates related to the fair value of assets acquired and liabilities assumed in business combinations, including acquired intangible assets and the fair value of inventory acquired, estimates utilized in the ongoing valuation of inventory related to potential unsalable product, estimates of useful lives with respect to intangible assets, accounting for stock-based compensation, contingencies, impairment of goodwill and intangible assets, future payments under the deferred royalty obligation, and deferred tax valuation allowances.

The Company bases estimates and assumptions on historical experience when available and on various factors that it believes to be reasonable under the circumstances.

The Company evaluates its estimates and assumptions on an ongoing basis.

The Company evaluates its estimates and

assumptions on an ongoing basis.

The Company’s actual results may differ from these estimates under different assumptions or conditions.

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Money market funds

Treasury securities

Commercial paper

Marketable securities:

Corporate debt securities

Treasury securities

Government-sponsored securities

Commercial paper

Total assets measured at fair value

Contingent consideration

Total liabilities measured at fair value

December 31, 2023

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Money market funds

Treasury securities

Marketable securities:

Corporate debt securities

Treasury securities

Government-sponsored securities

Total assets measured at fair value

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Accordingly, these securities are categorized as Level 1.

Contingent Consideration

The Company’s contingent consideration liability is related to the Ironshore Acquisition in 2024.

The Ironshore Acquisition includes a contingent payment of $ 25,000 related to the achievement of a financial milestone based on net revenues of Jornay for the year ended December 31, 2025.

The contingent consideration liability is measured at fair value using an option pricing model.

The Company classifies its contingent consideration liability as a Level 3 fair value measurement based on the significant unobservable inputs used to estimate fair value.

The key assumptions considered in estimating the fair value include the estimated probability and timing of milestone achievement, such as the probability and timing of projected revenues.

Change in the Fair Value of Contingent Consideration

The following table provide a reconciliation of the beginning and ending balances related to the contingent consideration for the Ironshore Acquisition:

Ironshore Acquisition

Contingent Consideration

Balance as of December 31, 2023

Acquisition date fair value

Gain on fair value remeasurement of contingent consideration

Balance as of December 31, 2024

Assets and Liabilities Not Carried at Fair Value

Convertible Senior Notes

The Company’s convertible senior notes fall into the Level 2 category within the fair value level hierarchy.

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As of December 31, 2023, the fair value of the Company’s 2.875 % convertible senior notes due in 2029 was $ 249,803 and the net carrying value was $ 236,133 .

During the year ended December 31, 2024, the Company fully redeemed its 2.625 % convertible senior notes due in 2026 and thus none of these notes were outstanding as of December 31, 2024.

As of December 31, 2023, the fair value of the Company’s 2.625 % convertible senior notes due in 2026 was $ 25,033 and the net carrying value was $ 25,992 .

Term Notes Payable

The Company’s term notes fall into the Level 2 category within the fair value level hierarchy and the fair value was determined using quoted prices for similar liabilities in active markets, as well as inputs that are observable for the liability (other than quoted prices), such as interest rates that are observable at commonly quoted intervals.

As of December 31, 2023, the carrying amount of the term notes reasonably approximated the estimated fair value.

As of December 31, 2023, and 2022, the carrying amounts of the cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued liabilities, and accrued rebates, returns and discounts, reasonably approximated the estimated fair values.

As of December 31, 2024 and 2023, the carrying amount of the term notes reasonably approximated the estimated fair value.

Deferred Royalty Obligation

The Company’s deferred royalty obligation was assumed as part of the Ironshore Acquisition in 2024.

Refer to Note 15, Deferred Royalty Obligation , for more information.

The deferred royalty obligation is not carried at fair value.

The deferred royalty obligation is considered a level 3 fair value measurement.

The fair value of the Company’s deferred royalty obligation approximates the carrying value as of December 31, 2024.

Other Assets and Liabilities

As of December 31, 2024, and 2023, the carrying amounts of the cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued liabilities, and accrued rebates, returns and discounts, approximated the estimated fair values.

Concentration of Credit Risk

Financial instruments, which potentially subject the Company to significant concentration of credit risk, consist primarily of cash and cash equivalents and accounts receivable.

Financial instruments, which potentially subject the Company to significant concentration of credit risk, consist primarily of cash and cash equivalents, marketable securities, and accounts receivable.

The Company maintains its cash deposits primarily with one reputable and nationally recognized financial institution.

In addition, as of December 31, 2023, the Company’s cash equivalents were invested in money market funds.

In addition, as of December 31, 2024, the Company’s cash equivalents were invested in money market funds and commercial paper.

The Company has not experienced any material losses in such accounts and management believes that the Company is not exposed to significant credit risk due to the financial position of the financial institutions in which those deposits are held and the nature of the assets in the money market funds.

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Cash and Cash Equivalents

Cash and cash equivalents include cash in readily available checking and savings accounts, including bank deposits, and investments in money market funds.

Cash and cash equivalents include cash in readily available checking and savings accounts, including bank deposits, investments in money market funds, and commercial paper.

The Company considers all highly liquid investments with an original maturity of three months or less from the date of purchase to be cash equivalents.

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Restricted cash is reported as non-current unless the restrictions are expected to be released in the next twelve months.

Restricted cash as of December 31, 2023 represents cash held in a depository account at a financial institution to collateralize conditional standby letters of credit for the Company’s lease of its corporate headquarters and its leases of vehicles for its field-based employees.

Restricted cash as of December 31, 2024 includes $ 25,000 of deposits into escrow at the closing of the Ironshore Acquisition, to be released (i) in part, after, and subject to, determination of any adjustments related to finalization of working capital and cash at closing;

and (ii) in part, and subject to, the lapse of certain indemnification obligations 12 months from the Acquisition Date.

The remaining amounts in restricted cash represent cash held in a depository account at a financial institution to collateralize conditional standby letters of credit for the Company’s lease of its corporate headquarters and its leases of vehicles for its field-based employees.

Marketable Securities

As of December 31, 2023, the Company’s marketable securities consisted of investments in available-for-sale corporate debt, U.S.

As of December 31, 2024 and 2023, the Company’s marketable securities consisted of investments in available-for-sale corporate debt, commercial paper, U.S.

Treasury, and government-sponsored securities with readily determinable fair values.

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The Company records interest earned and net amortization of premiums and discounts on investments within interest income on its consolidated statements of operations.

The Company records unrealized gains (losses) on available-for-

sale debt securities as a component of “ Accumulated other comprehensive income,” which is a separate component of shareholders’ equity on its consolidated balance sheets, until such gains and losses are realized.

The Company records unrealized gains (losses) on available-for-sale debt securities as a component of “ Accumulated other comprehensive income,” which is a separate component of shareholders’ equity on its consolidated balance sheets, until such gains and losses are realized.

Realized gains and losses are determined using the specific identification method.

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In determining whether impairments are other-than-temporary, the Company considers its ability and intention to hold the investment until market price recovery, as well as issuer-specific credit ratings, historical losses, and current economic conditions.

The Company generally intends to retain investments until their amortized cost is recovered and did not identify any investments with other-than-temporary impairment as of December 31, 2023.

The Company generally intends to retain investments until their amortized cost is recovered and did not identify any investments with other-than-temporary impairment as of December 31, 2024 and 2023.

Inventories are stated at the lower of cost or net realizable value.

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Accordingly, the Company has concentration risk associated with its commercial manufacturing.

The Company expects to use the inventory over its operating cycle.

The Company expects to use the inventory that is classified within current assets on its consolidated balance sheet over its operating cycle.

Inventory that is not expected to be used over the Company’s operating cycle is classified as a non-current asset.

Refer to Note 8, Inventory , for further information.

Business Combination Accounting and Valuation of Acquired Assets

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The determination of the fair value requires the estimation of fair values based on non-observable inputs that are included in valuation models.

An income approach, which generally relies upon projected cash flow models, is used in estimating the fair value of the acquired intangible assets and the fair value of acquired inventory.

These cash flow projections are based on management's estimates of economic and market conditions including the estimated future cash flows from revenues of acquired assets, the timing and projection of costs and expenses and the related profit margins, tax rates, and an appropriate discount rate.

An income approach, which generally relies upon projected cash flow models, is used in estimating the fair value of the acquired intangible assets and the deferred royalty obligation.

The fair value of acquired inventory is based on inventory cost and other assumptions.

The cash flow projections are based on management's estimates of economic and market conditions including the estimated future cash flows from revenues of acquired assets, the timing and projection of costs and expenses and the related profit margins, tax rates, and an appropriate discount rate.

Goodwill represents the excess of the purchase price over the estimated fair value of the net assets acquired in a business combination.

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The Company records lease assets and liabilities for lease arrangements exceeding a 12-month initial term.

For operating leases, the Company records a beginning lease liability equal to the present value of minimum lease payments to be made over the lease term discounted using the Company’s incremental borrowing rate and a corresponding lease asset adjusted for incentives received and indirect costs.

At lease commencement, the Company measures the lease liability at the present value of the remaining lease payments discounted using the incremental borrowing rate and the corresponding lease asset is adjusted for incentives received and indirect costs.

For operating leases, the Company records an initial lease liability equal to the present value of minimum lease payments to be made over the lease term discounted using the Company’s incremental borrowing rate and a corresponding lease asset adjusted for incentives received and indirect costs.

The Company records operating lease rent expense in the statements of operations over the lease term.

Variable lease costs are not included in the measurement of the operating lease liability and are recognized in the period in which they are incurred.

Leases with an initial term of

12 months or less, or short-term leases, are not recorded on the Company’s consolidated balance sheets.

Leases with an initial term of 12 months or less, or short-term leases, are not recorded on the Company’s consolidated balance sheets.

Short-term lease expense is recognized on a straight-line basis over the lease term.

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Impairment of Long-Lived Assets

Long-lived assets consist primarily of property and equipment, operating and finance lease assets, and definite-lived intangible assets.

Long-lived assets consist primarily of property and equipment, operating lease assets, and definite-lived intangible assets.

The Company assesses the recoverability of its long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

If indications of impairment exist, projected future undiscounted cash flows associated with the asset (or asset group) would be compared to the carrying value of the asset to determine whether the asset's value is recoverable.

If impairment is determined, the Company writes down the asset to its estimated fair value and records an impairment loss equal to the excess of the carrying value of the long-lived asset over its estimated fair value in the period at which such a determination is made.

If impairment is determined, the Company records an impairment loss equal to the excess of the carrying value of the long-lived asset over its estimated fair value in the period at which such a determination is made.

Revenue Recognition

The Company’s revenue to date is from sales of the Company’s products, which are primarily sold to wholesale pharmaceutical distributors, which in turn sell the product to pharmacies for the treatment of patients.

The Company’s revenue is from sales of the Company’s products, which are primarily sold to wholesale pharmaceutical distributors, which in turn sell the product to pharmacies for the treatment of patients.

The Company recognizes revenue when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services.

Refer to Note 3, Revenue from Contracts with Customers , for more information.

Deferred Royalty Obligation

The Company’s deferred royalty obligation liability is a debt obligation of Ironshore that was assumed as part of the Ironshore Acquisition.

The deferred royalty obligation relates to royalty payments on revenue of Jornay that are paid to debtholders in exchange for preacquisition funding provided to Ironshore by the debtholders.

The Company accretes the deferred royalty obligation to the estimated future royalty payments over the life of the agreement and records the accretion as interest expense using the effective interest rate.

The carrying value of the obligation decreases for royalty payments made based upon the actual Jornay revenue and related royalty payments.

The effective interest rate is calculated based on current estimates of future royalty payments over the life of the agreement.

To the extent estimates of future royalty payments are greater or less than previous estimates or the estimated timing of such payments is materially different than previous estimates, the Company accounts for any such changes by adjusting the effective interest rate on a prospective basis, which will adjust future interest expense.

Refer to Note 15, Deferred Royalty Obligation , for more information.

Research and Development Costs

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Product development expenses primarily consisted of labor, benefits, and related employee expenses for personnel directly involved in product development activities, fees paid to contract research organizations for managing clinical and non-clinical trials, and regulatory costs.

As of April 1, 2022, the Company focused entirely on commercial products rather than research and development and redirected resources from research and development activities.

Since April 1, 2022, the Company has focused entirely on commercial products rather than research and development and redirected resources from research and development activities.

As such, there were no expenses incurred in research and development after the three months ended March 31, 2022.

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The Company estimates the grant date fair value of awards with market conditions using the Monte Carlo model.

Restructuring

During the three months ended December 31, 2021, the Company executed a plan to reduce its workforce, primarily related to its salesforce.

The arrangements included the payment of a cash severance benefit near the time of separation, together with continued medical benefits and related services.

As a result, the Company recognized $ 4,578 in restructuring expense.

Of this amount, $ 1,335 was paid by December 31, 2021 and the remaining $ 3,243 was paid in the first half of 2022.

The Company accounts for income taxes under the liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements.

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Embedded Derivatives

The Company accounts for derivative financial instruments as either equity or liabilities in accordance with Accounting Standards Codification Topic 815, Derivatives and Hedging , (“ASC 815”) based on the characteristics and provisions of each instrument.

Embedded derivatives are required to be bifurcated from the host instruments and recorded at fair value if the derivatives are not clearly and closely related to the host instruments on the date of issuance.

The Company’s term notes and convertible notes (refer to Note 14, Debt ) contain certain features that, in accordance with ASC 815, are not clearly and closely related to the host instrument and represent derivatives that are required to be re-measured at fair value each reporting period.

The Company determined that the estimated fair value of the derivatives at issuance and through December 31, 2023 were not material based on a scenario-based cash flow model that uses unobservable inputs that reflect the Company’s own assumptions.

The Company’s term notes and convertible notes (refer to Note 14, Debt ) contain certain features that are not clearly and closely related to the host instrument and represent derivatives that are required to be re-measured at fair value each reporting period.

The Company determined that the estimated fair value of the derivatives at issuance and through December 31, 2024 were not material based on a scenario-based cash flow model that uses unobservable inputs that reflect the Company’s own

Should the Company’s assessment of the probabilities around these scenarios change, including due to changes in market conditions, there could be a change to the fair value.

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New accounting pronouncements are issued periodically by the Financial Accounting Standards Board (“FASB”) and are adopted by the Company as required by the specified effective dates.

In August 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40):

Accounting for Convertible Instruments and Contracts in an Entity's Own Equity .

This ASU simplifies the complexity associated with applying U.S.

GAAP for certain financial instruments with characteristics of liabilities and equity.

More specifically, the amendments focus on the guidance for convertible instruments and derivative scope exceptions for contracts in an entity’s own equity.

Under ASU 2020-06, the embedded conversion features are no longer separated from the host contract for convertible instruments with conversion features that are not required to be accounted for as derivatives under Topic 815, or that do not result in substantial premiums accounted for as paid-in capital.

Consequently, a convertible debt instrument, such as the Company’s convertible senior notes, will be accounted for as a single liability measured at its amortized cost, as long as no other features require bifurcation and recognition as derivatives.

The new guidance also requires the if-converted method to be applied for all convertible instruments and requires additional disclosures.

The Company elected to early adopt this guidance on January 1, 2021 using the modified retrospective method.

Under this transition method, the cumulative effect of the accounting change was removing the impact of recognizing the equity component of the Company’s convertible notes (at issuance and the subsequent accounting impact of additional interest expense from debt discount amortization).

The cumulative effect of the accounting change as of January 1, 2021 was an increase to the carrying amount of the convertible notes of $ 39,489 , a reduction to accumulated deficit of $ 5,288 , and a reduction to additional paid-in capital of $ 44,777 .

Interest expense of the convertible senior notes will be lower as a result of adoption of this guidance and diluted net loss per share will be computed using the if-converted method for the convertible senior notes.

As a result of the adoption of this guidance, interest expense decreased and net income increased by $ 6,488 , basic earnings per share was increased by $ 0.19 , and diluted earnings per share was decreased by $ 0.06 for the year ended December 31, 2021.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) :

Facilitation of the Effects of Reference Rate Reform on Financial Reporting , to ease the potential burden in accounting for reference rate reform.

The amendments in ASU 2020-04 were elective and applied to all entities that have contracts, hedging relationships, and other transactions that reference the London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued due to reference rate reform.

The standard became effective immediately and may be applied prospectively to contracts and transactions through December 31, 2022.

Subsequent to issuance, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848):

Scope, in January 2021 to refine and clarify some of its guidance on ASU 2020-04 and ASU 2022-06, Reference Rate Reform (Topic 848) to defer the sunset date of Topic 848 from December 31, 2022 to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848.

Following the cessation of LIBOR in the United States on June 30, 2023, the Company elected to apply the optional expedient provided in FASB ASU 2020-04, Reference Rate Reform (Topic 848):

Facilitation of the Effects of Reference Rate Reform on Financial Reporting prospectively.

Thus, debt previously referenced to LIBOR was transitioned to the Secured Overnight Financing Rate (“SOFR”) effective July 1, 2023, however, such transition did not have a material effect on the Company’s consolidated financial statements.

Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2023, the FASB issued ASU 2023-07 , Segment Reporting (Topic 280).

In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280) .

The amendments in this update expand segment disclosure requirements, including new segment disclosure requirements for entities with a single reportable segment among other disclosure requirements.

This update is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements.

This update is effective for fiscal years beginning after December 15, 2023 for the Company’s annual report, and interim periods within fiscal years beginning after December 15, 2024.

The adoption of this standard did not to have a material impact on the Company’s consolidated financial statements, and the Company’s provided enhanced disclosures as required to comply with this standard.

Refer to Note 21, Segments , for further information.

Recently Issued Accounting Pronouncements Not Yet Adopted

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740).

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This update is effective for annual periods beginning after December 15, 2024.

The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements.

The Company is currently evaluating the effect of adopting this guidance on its consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40) .

The amendments in this update require disclosure of specified information about certain costs and expenses.

This update is effective for annual periods beginning after December 15, 2026.

The Company is currently evaluating the effect of adopting this guidance on its consolidated financial statements.

In November 2024, the FASB issued ASU 2024-04, Debt – Debt with Conversion and Other Options (Subtopic 470-20) .

The amendments in this update clarify the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion.

This update is effective for annual periods beginning after December 15, 2025.

The Company is currently evaluating the effect of adopting this guidance on its consolidated financial statements.

Other recent accounting pronouncements issued, but not yet effective, are not expected to be applicable to the Company or have a material effect on the consolidated financial statements upon future adoption.

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At contract inception, the Company assesses the goods or services promised within each contract and determines those that are performance obligations and assesses whether each promised good or service is distinct.

The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

The Company expenses incremental costs of obtaining a contract as and when incurred if the expected amortization period of the assets is one year or less.

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The Company will estimate the amount of variable consideration that should be included in the transaction price under the expected value method for all sales deductions other than trade allowances, which are estimated under the most likely amount method.

These provisions reflect the expected amount of consideration to which

the Company is entitled based on the terms of the contract.

These provisions reflect the expected amount of consideration to which the Company is entitled based on the terms of the contract.

In addition, the Company made a policy election to exclude from the measurement of the transaction price all taxes that are assessed by a governmental authority that are imposed on revenue-producing transactions.

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Product Returns

Provisions for product returns, including returns for Xtampza, the Nucynta Products, Belbuca and Symproic, are based on product-level returns rates, including processed as well as unprocessed return claims, in addition to relevant market events and other factors.

Provisions for product returns are based on product-level returns rates, including processed as well as unprocessed return claims, in addition to relevant market events and other factors.

Estimates of the future product returns are made at the time of revenue recognition to determine the amount of consideration to which the Company expects to be entitled (that is, excluding the products expected to be returned).

At the end of each reporting period, the Company analyzes trends in returns rates and updates its assessment of variable consideration.

To the extent the Company receives amounts in excess of what it expects to be entitled to receive due to a product return, the Company does not recognize revenue when it transfers products to customers but instead recognizes those excess amounts received as a refund liability.

To the extent the Company receives amounts in excess of what it expects to be entitled to receive due to a product return, the Company does not recognize revenue when it

transfers products to customers but instead recognizes those excess amounts received as a refund liability.

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The Company’s return policy requires that product is returned and that the return is claimed within the 18-month window.

2021 Returns Adjustment

Prior to the year ended December, 31, 2021, estimates of the refund liability for Xtampza product returns were based on a combination of a limited amount of historical actual returns processed to date, taking into consideration the expiration date of product upon delivery to customers, as well as forecasted customer buying and return patterns, channel inventory levels, and other specifically known market events and trends.

Sales of Xtampza increased significantly starting in 2018;

as a result, the majority of Xtampza sold to customers by the Company had not been eligible for return until the year ended December 31, 2021, or beyond.

For the Nucynta Products, estimates of the refund liability for product returns were based on historical returns rates as these products have been commercially sold in the U.S.

since 2009 for Nucynta IR and since 2011 for Nucynta ER.

Because the Company began selling the Nucynta Products in 2018, most of the Nucynta Products sold to customers by the Company were not eligible for return until the year ended December 31, 2021, or beyond.

During the year ended December 31, 2021, there were unprecedented and significant disruptions in the processing of product returns.

Specifically, the Company’s customers, via the third-party returns processor that they and many pharmacies engage to process the majority of the Company’s product returns, failed to return products to the Company in the ordinary course.

The value of actual returned product during the year ended December 31, 2021 represented less than 20 % of the value of the product returns claimed during that period.

Due to the failure of the customers and their vendor to return product timely in the ordinary course, the Company did not physically receive returned products corresponding to the substantial majority of the returns claimed and could not validate or finalize customer return claims, nor determine if the return was or would be eligible for refund upon the physical return.

The lack of timely processing of requested product returns obscures information related to the validation of product returns and increases uncertainty related to the actual volume of product that will be physically returned and credited in accordance with the Company’s returns policy.

During the fourth quarter of 2021, after significant and sustained efforts with customers to resolve the unprocessed return claims, the Company formally denied a significant portion of these claims under the Company’s return policy.

The Company subsequently received payment for only a portion of the denied claims and vigorously pursued collections of the full amount of these short-pay receivables.

As a result of discussions with customers related to unprocessed return claims and the uncertainty associated with the ultimate resolution, as well as the impact of unprocessed claims on estimates of future returns, the Company recorded an adjustment to reduce product revenues, net of $ 38,329 , with offsetting reductions in accounts receivable or increases in the refund liability for future product returns.

During the year ended December 31, 2022, the Company revised its estimate of variable consideration associated with unprocessed returns claims that arose in prior periods due to the receipt of payment and settlement, which resulted in an increase to product revenues, net of $ 4,684 .

During the year ended December 31, 2021, the Company’s adjustment was a $ 26,644 reduction in product revenues.

Trade Allowances and Chargebacks

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Balance as of December 31, 2021

Acquired from BDSI

Provision related to current period sales

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Balance as of December 31, 2022

Acquired from BDSI

Provision related to current period sales

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Balance as of December 31, 2023

Acquired from Ironshore

Provision related to current period sales

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Total product revenues, net

The Company began recognizing revenue from net product sales of Belbuca and Symproic following the Acquisition Date as defined in Note 4, Acquisitions .

On March 22, 2022 (the “Acquisition Date”), the Company acquired BioDelivery Sciences International, Inc.

(“BDSI”), a specialty pharmaceutical company working to deliver innovative therapies for individuals living with serious and debilitating chronic conditions (the “BDSI Acquisition”).

The Company began recognizing revenue from Jornay in September 2024 following the acquisition of Ironshore.

The Company began recognizing revenue from Belbuca and Symproic in March 2022 following the acquisition of BDSI.

Refer Note 4, Acquisitions , for further information.

Contract Liabilities

The Company’s contract liabilities, or deferred revenue, primarily relate to contracts where the Company has received payment, but it has not yet satisfied or fully satisfied the related performance obligations.

Upfront payments and fees are recorded as deferred revenue upon receipt or when due and may require deferral of revenue recognition to a future period until the Company satisfies its obligations under these arrangements.

The Company’s only contract liability relates to a contract with Knight Therapeutics, Inc.

(“Knight”), which was entered into by Ironshore and Knight in May 2024 and was assumed as part of the Ironshore Acquisition (see Note 4, Acquisition ).

The contract provides Knight the right to sell Jornay in Canada and certain countries in Latin America, subject to regulatory approval.

The contract provides for a nonrefundable upfront payment of $ 10,000 , sales milestones, royalties on net revenue, and reimbursement for certain manufacturing expenses.

The Company identified one combined performance obligation in the contract related primarily to the sale of products.

The up-front payment will be recognized as revenue as product sales are made over the term of the contract.

No products have been delivered to date under this contract and therefore no revenue has been recognized through December 31, 2024.

Ironshore Acquisition

On September 3, 2024, the Company closed the Ironshore Acquisition.

Ironshore had developed and obtained commercial approval to market Jornay in the United States.

The Ironshore Acquisition was completed to expand the Company’s business beyond pain management and establish a commercial presence in neuropsychiatry via the attention deficit hyperactivity disorder (“ADHD”) market.

The Company obtained control through the acquisition of shares in an all-cash transaction which closed on September 3, 2024 (“the Acquisition Date”).

The acquisition consideration includes payments for the Ironshore equity and assumption of certain of its debt.

The Company deposited $ 25,000 into escrow at closing, to be released (i) in part, after, and subject to, determination of any adjustments related to finalization of working capital and cash at closing;

and (ii) in part, and subject to, the lapse of certain indemnification obligations 12 months from the Acquisition Date.

As of the Acquisition Date, and December 31, 2024, approximately $ 21,956 was due to the former Ironshore equity holders and $ 25,000 is recorded as restricted cash.

In addition, the Company will pay approximately $ 7,000 to former Ironshore equity holders as the Company recovers certain acquired deposits as specified in the Merger Agreement, which amount is due no later than 225 days from the Acquisition Date.

The Company also agreed to pay a $ 25,000 contingent payment upon the achievement of a financial milestone based on net revenues of Jornay for the year ended December 31, 2025.

The fair value of the total consideration was approximately $ 309,940 consisting of the following (in thousands):

Fair Value of Purchase Price Consideration

Fair value of purchase price consideration paid at closing:

Initial cash consideration

Deferred payments and contingent consideration:

Cash held in escrow related to indemnification and other settlements

Other deferred consideration

Fair value of contingent consideration

Total purchase consideration

The Company has accounted for the Ironshore Acquisition as a business combination and, accordingly, has included the assets acquired, liabilities assumed and results of operations in its financial statements following the Acquisition Date.

The preliminary purchase price allocation is based on estimates, assumptions, valuations and other studies which have not yet been finalized.

The Company is finalizing its valuation of intangible assets, tangible assets, liabilities and tax analyses, and anticipates finalizing the valuation of assets acquired and liabilities assumed as the information necessary to complete the analysis is obtained, but no later than one year after the Acquisition Date.

In the fourth quarter of 2024, the Company recognized measurement period adjustments to increase accrued returns by $ 31,298 , deferred tax assets by $ 15,368 , goodwill by $ 16,374 and certain other accounts by $ 444 .

The following tables set forth the final allocation of the Ironshore Acquisition purchase price to the estimated fair value of the net assets acquired at the Acquisition Date:

Amounts Recognized at the Acquisition Date

Assets Acquired

Cash and cash equivalents

Accounts receivable

Prepaid expenses and other current assets

Property, plant and equipment, net

Intangible assets

Right-of-use assets

Deferred tax assets

Liabilities Assumed

Accounts payable

Accrued liabilities

Accrued rebates, returns and discounts

Lease liabilities

Senior secured notes payable

Deferred royalty obligation

Deferred revenue

Total liabilities

Total identifiable net assets acquired

Total consideration transferred

The valuation of the acquired intangible assets and assumed deferred royalty obligations relies on significant unobservable inputs.

The Company used an income approach to value the $ 635,000 for the acquired intangible asset.

The valuation of the intangible asset was based on estimated projections of expected cash flows to be generated by the asset, discounted to the present value at an appropriate discount rate.

The Company is amortizing the identifiable intangible asset on a straight-line basis over its useful life of 7.7 years (refer to Note 11, Goodwill and Intangible Assets ).

The acquired inventory was recorded at fair value, which includes an adjustment to record inventory from its historic cost to fair value of $ 10,700 .

The assumed senior secured notes payable and borrowings were settled immediately after the close of the acquisition, resulting in a loss in debt extinguishment of $ 4,145 .

The excess of the purchase price over the fair value of identifiable net assets acquired represents goodwill.

This goodwill is primarily attributable to synergies of merging operations.

The acquired goodwill is not deductible for tax purposes.

Total revenues attributable to Ironshore from the Acquisition Date through December 31, 2024 were $ 37,239 .

However, earnings attributable to Ironshore from the Acquisition Date through December 31, 2024 are not distinguishable due to the rapid integration of Ironshore’s core operations into the Company.

Unaudited Pro Forma Summary of Operations

The following table shows the unaudited pro forma summary of operations for the twelve months ended December 31, 2024 and 2023, as if the Ironshore Acquisition had occurred on January 1, 2023.

This pro forma information does not purport to represent what the Company’s actual results would have been if the acquisition had occurred as of January 1, 2023, and is not indicative of what such results would be expected for any future period (in thousands) :

Years Ended December 31,

Total revenues

The unaudited pro forma financial information was prepared using the acquisition method of accounting and was based on the historical financial information of the Company and Ironshore.

The summary pro forma financial information primarily reflects the following pro forma adjustments:

● Employee severance-related expense of $ 10,360 was reflected as of January 1, 2023;

● The Company’s acquisition-related transaction costs of $ 9,046 were reflected as of January 1, 2023;

● Additional amortization expense from the acquired intangibles;

● Additional cost of product revenues related to the step-up basis in inventory to record inventory at fair value;

● Adjustments to the Company’s interest expense related to additional borrowings on the 2024 Term Loan as defined in Note 14, Debt, and elimination of certain Ironshore debt .

In addition, all of the above adjustments were adjusted for the applicable tax impact.

Acquisition Related Expenses

During the year ended December 31, 2024, the Company incurred $ 24,329 of acquisition related expenses as a result of the Ironshore Acquisition and the substantial majority were included in Selling, general, and administrative expense in the consolidated statements of operations.

These costs include transaction costs, which primarily consisted of financial advisory, banking, legal, and regulatory fees, and other consulting fees, incurred to complete the acquisition;

employee-related expenses (severance cost and benefits) for terminated employees after the acquisition, Ironshore directors and officers insurance purchased at the closing of the Ironshore Acquisition, and miscellaneous other acquisition expenses incurred, including integration consulting costs and contract termination costs.

The Company has accrued $ 510 related to employee severance costs incurred as of December 31, 2024 but not yet paid.

Additional charges related to severance or retention payments are not expected to be material and the remaining employee termination costs are expected to be paid by March 31, 2025.

The Company expects, however, to incur additional acquisition-related expenses relating to consulting fees, contract termination costs, and other integration-related expenses during the first half of 2025.

Year Ended December 31, 2024

Employee-related expenses

Transaction costs

Ironshore directors and officers insurance

Other acquisition expenses

Total acquisition related expenses

BDSI Acquisition

On March 22, 2022 (the “BDSI Acquisition Date”), the Company acquired BioDelivery Sciences International, Inc.

(“BDSI”) in an all-cash transaction.

Upon closing, the Company acquired Belbuca and Symproic.

The BDSI Acquisition was completed to leverage the Company’s existing sales force and other operations to commercialize additional products that are typically marketed to similar physicians and to develop other synergies.

The Company obtained control through the acquisition of shares in an all-cash transaction which closed on March 22, 2022.

The total consideration paid for the BDSI acquisition was approximately $ 669,431 consisting of the following (in thousands, except per share amounts):

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Total purchase consideration

The Company has accounted for the BDSI Acquisition as a business combination and, accordingly, has included the assets acquired, liabilities assumed and results of operations in its financial statements following the Acquisition Date.

The final allocation of the consideration transferred to the assets acquired and liabilities assumed has been completed.

During the three months ended March 31, 2023, the Company recorded measurement period adjustments to increase accrued expenses by $ 134 and deferred tax liabilities by $ 28 , with a corresponding increase to goodwill of $ 162 .

The following tables set forth the final allocation of the BDSI Acquisition purchase price to the estimated fair value of the net assets acquired at the Acquisition Date:

Amounts Recognized at the Acquisition Date

The final allocation of the consideration transferred to the assets acquired and liabilities assumed was completed in the year ended December 31, 2023.

The following tables set forth the final allocation of the BDSI Acquisition purchase price to the estimated fair value of the net assets acquired at the BDSI Acquisition Date:

Amounts Recognized at the BDSI Acquisition Date

Assets Acquired

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The acquired goodwill is not deductible for tax purposes.

Total revenues attributable to BDSI from the Acquisition Date through December 31, 2022 were $ 140,653 .

However, earnings attributable to BDSI from the Acquisition Date through December 31, 2022 are not distinguishable due to the rapid integration of BDSI’s core operations into the Company.

Total revenues attributable to BDSI from the BDSI Acquisition Date through December 31, 2022 were $ 140,653 .

However, earnings attributable to BDSI from the BDSI Acquisition Date through December 31, 2022 are not distinguishable due to the rapid integration of BDSI’s core operations into the Company.

Unaudited Pro Forma Summary of Operations

The following table shows the unaudited pro forma summary of operations for the years ended December 31, 2022 and 2021, as if the BDSI Acquisition had occurred on January 1, 2021.

The following table shows the unaudited pro forma summary of operations for the years ended December 31, 2022, as if the BDSI Acquisition had occurred on January 1, 2021.

This pro forma information does not purport to represent what the Company’s actual results would have been if the acquisition had occurred as of January 1, 2021, and is not indicative of what such results would be expected for any future period:

Years Ended December 31,

Year Ended December 31, 2022

Total revenues

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The pro forma financial information primarily reflects the following pro forma adjustments:

● The Company’s acquisition related transaction costs of $ 14,718 were reflected as of January 1, 2021;

● Employee severance related expense of $ 8,008 was reflected as of January 1, 2021;

● Additional amortization expense from the acquired intangibles;

● A dditional amortization expense from the acquired intangibles;

● Additional cost of product revenues related to the step-up basis in inventory to record inventory at fair value;

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The Company periodically enters into license agreements to develop and commercialize its products.

Grünenthal License

In connection with the acquisition of the Nucynta Products from Assertio Therapeutics, Inc.

(the “Nucynta Acquisition”), the Company assumed all commercialization responsibilities, including sales and marketing, for the Nucynta Products through the acquisition of a license from Grünenthal Gmbh (“Grünenthal”) (the “Grünenthal License”).

Pursuant to the Grünenthal License, the Company is obligated to make royalty payments directly to Grünenthal at a rate of 14 % on net sales of Nucynta Products.

Unless earlier terminated, the Grünenthal License Agreement will continue in effect until the expiration of the royalty obligations therein.

Upon expiration of the Grünenthal License, the Company will retain a fully paid up, non-exclusive license to make, use and sell the Nucynta Products under the Grünenthal Patents (as defined therein) in the United States.

Shionogi License and Supply Agreement

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Diluted earnings per share is computed by dividing the net income or loss by the weighted-average number of shares of common stock, plus potentially dilutive securities outstanding for the period, as determined in accordance with the treasury stock, if-converted, or contingently issuable accounting methods, depending on the nature of the security.

For purposes of the diluted earnings per share calculation, stock options, restricted stock units (“RSUs”), performance share units (“PSUs”), and shares potentially issuable in connection with the employee stock purchase plan and convertible senior notes are considered potentially dilutive securities and included to the extent that their addition is not anti-dilutive.

The following table presents the computations of basic and dilutive earnings (loss) per common share:

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Net income (loss)

Adjustment for interest expense recognized on convertible senior notes:

Net (loss) income — diluted

Adjustment for interest expense recognized on convertible senior notes, net of tax

Net income (loss) — diluted

Weighted-average shares outstanding — basic

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Performance share units

Employee stock purchase plan

Convertible senior notes

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Earnings (loss) per share — diluted

The Company has the option to settle the conversion obligation for its convertible senior notes due in 2026 and 2029 in cash, shares or a combination of the two.

The Company has the option to settle the conversion obligation for its convertible senior notes in cash, shares or a combination of the two.

The Company uses the if-converted method for the convertible senior notes.

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Marketable securities

The following table summarizes the available-for-sale securities held as of December 31, 2023:

Available-for-sale debt securities consisted of the following:

December 31, 2024

Amortized Cost

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Government-sponsored securities

The following table summarizes the contractual maturities of available-for-sale securities other than investments in money market funds as of December 31, 2023:

Commercial paper

December 31, 2023

Corporate debt securities

Treasury securities

Government-sponsored securities

The contractual maturities of available-for-sale debt securities were as follows:

Matures within one year

Matures after one year through five years

The Company did not record any allowances for credit losses to adjust the fair value of available-for-sale debt securities during the year ended December 31, 2023.

The Company did not hold marketable securities as of December 31, 2022.

There were no sales of marketable securities during the year ended December 31, 2023.

Net unrealized holding gains or losses for the period that have been included in other comprehensive income were not material to the Company’s consolidated results of operations.

The unrealized losses on the Company’s available-for-sale debt securities were immaterial as of December 31, 2024 and December 31, 2023.

The Company did not hold available-for-sale debt securities as of December 31, 2022.

There were no sales of marketable securities during the years ended December 31, 2024 or 2023.

Net unrealized holding gains or losses for the period that have been previously included in accumulated other comprehensive income were not material to the Company’s consolidated statement of operations.

The Company did not record any allowances for credit losses to adjust the fair value of available-for-sale debt securities during the year ended December 31, 2024 or 2023.

The Company reviews its investments for other-than-temporary impairment whenever the fair value of an investment is less than amortized cost and evidence indicates that an investment’s carrying amount is not recoverable within a reasonable period of time.

To determine whether an impairment is other-than-temporary, the Company considers whether it has the ability and intent to hold the investment until a market price recovery and considers whether evidence indicating the cost of the investment is recoverable outweighs evidence to the contrary.

The Company generally does not intend to sell any investments prior to recovery of their amortized cost basis for any investment in an unrealized loss position.

As such, the Company did not hold any securities with other-than-temporary impairment as of December 31, 2024 or 2023.

Inventory consisted of the following:

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Total inventory

During the years ended December 31, 2023 and 2022, the expenses related to excess and obsolete inventory that were recorded as a component of cost of products revenues were $ 1,624 and $ 1,814 , respectively.

Expenses related to excess and obsolete inventory were immaterial for the year ended December 31, 2021.

During the years ended December 31, 2023, 2022, and 2021, inventory used in the construction and installation of property and equipment was immaterial.

Long-term inventory is included in other noncurrent assets in the Company’s consolidated balance sheet.

The balance sheet classification of inventory consisted of the following:

Years Ended December 31,

Other noncurrent assets

Total inventory

During the years ended December 31, 2024, 2023 and 2022 the expenses related to excess and obsolete inventory that were recorded as a component of cost of product revenues were $ 866 , $ 1,624 , and $ 1,814 , respectively.

Prepaid Expenses and Other Current Assets

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Years Ended December 31,

Prepaid co-pay program incentives

Prepaid regulatory fees

Prepaid income taxes

Prepaid co-pay program incentives

Prepaid insurance

Manufacturing deposits

Other current assets

Manufacturing deposits

Prepaid insurance

Other prepaid expenses

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Leasehold improvements

Construction-in-process

Total property and equipment

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Depreciation expense related to property and equipment amounted to $ 3,856 , $ 3,496 , and $ 2,684 for the years ended December 31, 2024, 2023, and 2022, respectively.

During the year ended December 31, 2024, the Company disposals of property and equipment assets were immaterial.

During the years ended December 31, 2023 and 2022, the Company disposed of fully depreciated assets of $ 141 , and $ 1,040 respectively.

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Goodwill and Intangible Assets

The Company’s goodwill resulted from the BDSI Acquisition.

The Company’s goodwill resulted from the acquisition of BioDelivery Sciences International, Inc.

(“BDSI”) on March 22, 2022 (the “BDSI Acquisition”) and the Ironshore Acquisition on September 3, 2024.

Refer to Note 4, Acquisitions, for more information.

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Balance as of December 31, 2022

Goodwill resulting from BDSI Acquisition

Balance as of December 31, 2022

Measurement period adjustments from BDSI Acquisition

Balance as of December 31, 2023

Goodwill resulting from Ironshore Acquisition

Balance as of December 31, 2024

The following table sets forth the cost, accumulated amortization, and carrying amount of intangible assets as of December 31, 2024 and 2023:

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As of December 31, 2023

Amortization Period

Accumulated Amortization

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Total amortization and impairment expense

(1) During the three months ended September 30, 2023, the United States Food and Drug Administration (“FDA”) granted New Patient Population exclusivity in pediatrics for Nucynta IR which extends the period of U.S.

(1) During the year ended December 31, 2023, the United States Food and Drug Administration (“FDA”) granted New Patient Population exclusivity in pediatrics for Nucynta IR which extends the period of U.S.

exclusivity for Nucynta IR to July 3, 2026, resulting in an extension of the estimated useful life of the underlying intangible asset from 8.0 years to 8.5 years.

This change in estimate resulted in a decrease of amortization expense of $ 4,099 and an increase in net income of $ 3,037 during the year ended December 31, 2023.

The impact to earnings per share — basic and earnings per share — diluted was $ 0.09 and $ 0.07 , respectively, during the year ended December 31, 2023.

(2) Includes $ 214 of amortization expense and $ 4,786 of impairment expense .

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Other expenses associated with the discontinuation of Elyxyb were immaterial.

The revenues generated from sales of Elyxyb to date were immaterial.

Elyxyb is not considered a significant component of the entity’s business and therefore, is not presented as a discontinued operation.

There were no employees impacted by the decision to discontinue the commercialization of Elyxyb and therefore, no severance or employee benefit expenses were recognized.

In addition, contract termination costs related to the discontinuation were immaterial and expensed upon the termination of the contracts.

In February 2023, the Company entered into the Elyxyb Sale Agreement with Scilex to transfer to Scilex all assets, rights, and obligations necessary to commercialize Elyxyb in the United States and Canada.

In February 2023, the Company transferred all of the assets, rights, and obligations necessary to commercialize Elyxyb in the United States and Canada to a third party.

As of December 31, 2024, the remaining amortization expense expected to be recognized is as follows:

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Accrued royalties

Accrued product taxes and fees

Accrued income taxes

Accrued bonuses

Accrued product taxes and fees

Accrued interest

Accrued income taxes

Accrued inventory

Accrued payroll and related benefits

Accrued incentive compensation

Accrued sales and marketing

Accrued incentive compensation

Liability for cash-settled share-based awards assumed from Ironshore Acquisition

Accrued audit and legal

Accrued severance expense related to Ironshore Acquisition

Accrued other operating costs

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From time to time, the Company may face legal claims or actions in the normal course of business.

Except as disclosed below, the Company is not currently a party to any material litigation and, accordingly, does not have any other amounts recorded for any litigation related matters.

Except as disclosed below, the Company is not currently a party to any material litigation.

Xtampza ER Litigation

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At this stage, the Company is unable to evaluate the likelihood of an unfavorable outcome or estimate the amount or range of potential loss, if any.

Opioid Litigation

As a result of the opioid epidemic, numerous state and local governments and other entities brought suit against manufacturers, distributors, and pharmacies alleging a variety of claims related to opioid marketing and distribution practices.

In late 2017, the U.S.

Judicial Panel on Multidistrict Litigation ordered the consolidation of cases pending around the country in federal court against opioid manufacturers and distributors into a Multi-District Litigation (“MDL”) in the Northern District of Ohio.

The Company was initially named as a defendant in 21 of the MDL cases.

By April 19, 2022, all MDL cases naming the Company were dismissed or withdrawn.

Outside of the MDL, several cases were filed against the Company in Arkansas, Pennsylvania, and Massachusetts state courts with allegations similar to those in the MDL related to opioid marketing and distribution practices, as well as allegations including violations of state consumer protections laws.

On March 21, 2019, the Arkansas state court litigation was dismissed.

On December 24, 2021, the Company entered into a settlement framework with Scott+Scott Attorneys at Law, LLP, the law firm representing plaintiffs in 27 jurisdictions filed either in Pennsylvania and Massachusetts state courts, or filed in other state courts and removed to the MDL.

Pursuant to the terms of the settlement, the Company paid $ 2,750 in exchange for dismissal, with prejudice, of each plaintiff’s lawsuit and a release of claims related to such lawsuits.

The Company is currently dismissed from all cases.

The Company settled to efficiently resolve these litigations and did not admit any liability or acknowledge any wrongdoing in connection with the settlement.

Opioid-Related Request and Subpoenas

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The Merger Litigations seek, among other things:

an injunction enjoining consummation of the Merger, rescission of the Merger Agreement, a declaration that BDSI and its Board of Directors violated Sections 14(e) and 20(a) of the Exchange Act and Rule 14a-9 promulgated thereunder, damages, costs of the action, including plaintiffs’ attorneys’ fees and experts’ fees and expenses, and any other relief the court may deem just and proper.

an injunction enjoining consummation of the Merger, rescission of the Merger Agreement, a declaration that BDSI and its Board of

Directors violated Sections 14(e) and 20(a) of the Exchange Act and Rule 14a-9 promulgated thereunder, damages, costs of the action, including plaintiffs’ attorneys’ fees and experts’ fees and expenses, and any other relief the court may deem just and proper.

In addition, between February and March of 2022, BDSI received demand letters from three purported stockholders of BDSI seeking to inspect certain books and records of BDSI related to the Merger (collectively, the “Inspection Letters”).

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On August 24, 2022, the Court instructed the parties to update the Court at such time as the FDA addresses Chemo's July 29, 2022 response to the FDA.

On February 8, 2023, the Court denied Chemo’s request for a trial date in the spring, and

again instructed the parties to update the Court at such time as the FDA addresses Chemo’s July 29, 2022 response to the FDA.

On February 8, 2023, the Court denied Chemo’s request for a trial date in the spring, and again instructed the parties to update the Court at such time as the FDA addresses Chemo’s July 29, 2022 response to the FDA.

Chemo received a complete response letter with respect to its July 29, 2022 ANDA in April 2023.

Chemo submitted a further amended ANDA to FDA in September 2023.

On May 30, 2024, the parties submitted a Joint Status Report to the Court providing that Chemo received a fourth Complete Response Letter on March 27, 2024.

On February 7, 2025, the parties submitted a Joint Status Report to the Court providing that Chemo received a fifth Complete Response Letter in January 2025.

The Company plans to litigate this case vigorously.

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2022 Term Loan

On February 6, 2020, in connection with the execution of the Nucynta Purchase Agreement, the Company, together with its subsidiary, Collegium Securities Corporation, entered into a loan agreement (the “2020 Loan Agreement”) with BioPharma Credit PLC, as collateral agent and lender, and BioPharma Credit Investments V (Master) LP, as lender (collectively “Pharmakon”).

The 2020 Loan Agreement provided for a $ 200,000 secured term loan (the “2020 Term Loan”), the proceeds of which were used to finance a portion of the purchase price paid pursuant to the Nucynta Purchase Agreement.

O n February 13, 2020 (the “2020 Term Loan Closing Date”) , the Company received the $ 200,000 proceeds from the 2020 Term Loan.

On March 22, 2022 the outstanding balance under the 2020 Loan Agreement was fully paid in connection with the closing of the BDSI Acquisition and establishment of the 2022 Term Loan, as described below.

2022 Term Loan

On March 22, 2022, in connection with the closing of the BDSI Acquisition, the Company entered into an Amended and Restated Loan Agreement by and among the Company, and BioPharma Credit PLC, as collateral agent and lender, and BioPharma Credit Investments V (Master) LP, as lender (collectively “Pharmakon”), as amended (the “2022 Loan Agreement”).

The 2022 Loan Agreement provided for a $ 650,000 secured term loan (the “2022 Term Loan”), the proceeds of which were used to repay the Company’s existing term notes and fund a portion of the consideration to be paid to complete the BDSI Acquisition.

The 2022 Loan Agreement provided for a $ 650,000 secured term loan (the “2022 Term Loan”), the proceeds of which were used to repay the Company’s existing term notes outstanding from an existing 2020 Term Loan and fund a portion of the consideration to be paid to complete the BDSI Acquisition.

The 2022 Loan Agreement was accounted for as a debt modification and transaction fees of $ 173 were expensed.

In connection with the 2022 Loan Agreement, the Company paid loan commitment and other fees to the lender of $ 19,818 , which together with preexisting debt issuance costs and note discounts of $ 2,049 will be amortized over the term of the loan using the effective interest rate.

The 2022 Term Loan will mature on the 48-month anniversary of the closing of the BDSI Acquisition and is guaranteed by the Company’s material domestic subsidiaries.

The 2022 Term Loan is also secured by substantially all of the assets of the Company and its material domestic subsidiaries.

Prior to the cessation of LIBOR on June 30, 2023, the 2022 Term Loan bore interest at a rate based on LIBOR (subject to a LIBOR floor of 1.20 %), plus a margin of 7.5 % per annum.

On June 23, 2023, the Company entered into an amendment to the 2022 Loan Agreement to adjust the interest terms of the 2022 Term Loan to transition from LIBOR to SOFR in anticipation of the cessation of LIBOR.

Effective July 1, 2023, the 2022 Term Loan bears interest at a rate based on SOFR plus a spread adjustment of 0.26 % (subject to a floor of 1.20 %), plus a margin of 7.5 % per annum.

In connection with the 2022 Loan Agreement, the Company paid loan commitment and other fees to the lender of $ 19,818 , which together with preexisting debt issuance costs and note discounts of $ 2,049 were be amortized over the term of the loan using the effective interest rate.

The net proceeds of the loan modification were $ 517,682 .

On July 28, 2024, the 2022 Term Loan was amended and restated in connection with the Ironshore Acquisition and establishment of the 2024 Term Loan as described below.

2024 Term Loan

On July 28, 2024, the Company entered into a Second Amended and Restated Loan Agreement by and among the Company, certain of its subsidiaries party thereto as guarantors, BioPharma Credit PLC as collateral agent, and BioPharma Credit Investments V (Master) LP and BPCR Limited Partnership (investment funds managed by Pharmakon Advisors, LP) as the lenders (the “Lenders”) party thereto (the “2024 Loan Agreement”).

The 2024 Loan Agreement provided for a $ 645,833 secured term loan (the “2024 Term Loan”), consisting of a $ 320,833 initial term loan and a $ 325,000 delayed draw term loan.

On the effective date of the 2024 Loan Agreement, the Company used the proceeds of the initial term loan to refinance in full all outstanding indebtedness under the 2022 Term Loan.

On the closing date of the Ironshore Acquisition, the Company used the proceeds of the delayed draw term loan to fund a portion of the consideration to complete the Ironshore Acquisition.

The Company used the remainder for general corporate purposes.

The 2024 Loan Agreement was accounted for as a debt modification as there was no change in the debtor or creditor and the present value of the cash flows under the terms of the new debt instrument were not at least 10% different from the present value of the remaining cash flows under the terms of the original instrument.

Accordingly, the new effective interest rate was determined based on the carrying amount of the original debt instrument adjusted for the increase in debt, and transaction fees of $ 619 were expensed.

In connection with the 2024 Loan Agreement, the Company paid loan commitment and other fees to the lender of $ 11,825 , which together with preexisting debt issuance costs and note discounts of $ 4,192 are amortized over the term of the loan using the effective interest rate.

The 2024 Term Loan is scheduled to mature on July 28, 2029 (provided, however, that if the aggregate principal amount outstanding under the 2029 Convertibles Notes is more than $ 50,000 as of November 18, 2028, then the 2024 Term Loan will mature on November 18, 2028) and is guaranteed by certain of the Company’s material subsidiaries.

The 2024 Term Loan is secured by substantially all of the assets of the Company and its material subsidiaries.

Until September 30, 2024, the 2024 Term Loan bore an annual interest rate equal to term Secured Overnight Financing Rate (“SOFR”) plus a spread adjustment of 0.13 % (subject to a 1.20 % floor), plus a margin of 7.50 %.

Following September 30, 2024, the 2024 Term Loan bears an annual interest rate equal to term SOFR plus a spread adjustment of 0.13 % (subject to a 4.00 % floor), plus a margin of 4.50 % per annum, and is subject to quarterly amortization payments equal to 2.50 % of the original funded amount of the 2024 Term Loan.

The Company paid a one-time fee of 1.25 % of the initial term loan principal amount on July 29, 2024 and paid a one-time fee of 2.25 % of the delayed draw term loan principal amount on September 3, 2024.

As of December 31, 2024, the contractual interest rate was 9.2 %.

The Company paid $ 100,000 in principal payments under the 2022 Term Loan during the first year and the remaining $ 550,000 balance is required to be paid in equal quarterly installments over the remaining three years.

The 2022 Loan Agreement permits voluntary prepayment at any time, subject to a prepayment premium.

The prepayment premium is equal to 2.00 % of the principal amount being prepaid prior to the second-year anniversary of the closing date, or 1.00 % of the principal amount being prepaid on or after the second-year anniversary of the closing date.

The 2022 Loan Agreement also includes a make-whole premium in the event of a voluntary prepayment, a prepayment due to a change in control or acceleration following an Event of Default (as defined in the 2022 Loan Agreement) on or prior to the second-year anniversary of the closing date, in each case in an amount equal to foregone interest from the date of prepayment through the second-year anniversary of the closing date.

A change of control also triggers a mandatory prepayment of the 2022 Term Loan.

The Company is required to pay the $ 629,687 principal balance under the 2024 Term Loan in equal quarterly installments of $ 16,146 over the remaining four years with a $ 387,500 final payment.

The 2024 Loan Agreement contains certain covenants and obligations of the parties, including, without limitation, covenants that limit the Company’s ability to incur additional indebtedness or liens, make acquisitions or other investments or dispose of assets outside the ordinary course of business.

Failure to comply with these covenants would constitute an event of default under the 2024 Loan Agreement, notwithstanding the Company’s ability to meet its debt service obligations.

The 2022 Loan Agreement also includes various customary remedies for the lenders following an Event of Default, including the acceleration of repayment of outstanding amounts under the 2022 Loan Agreement and execution upon the collateral securing obligations under the 2022 Loan Agreement.

The following table presents the total interest expense recognized related to the 2020 Term Loan and 2022 Term Loan during the years ended December 31, 2023, 2022, and 2021:

The 2024 Loan Agreement also includes various customary remedies for secured lenders following an event of default, including the acceleration of the outstanding amounts under the 2024 Loan Agreement and enforcement upon the collateral securing obligations under the 2024 Loan Agreement.

The following table presents the total interest expense recognized related to the 2024 Term Loan, the 2022 Term Loan, and the 2020 Term Loan during the years ended December 31, 2024, 2023, and 2022:

Years Ended December 31,

3 unchanged sentences

As of December 31, 2024, the effective interest rate on the 2024 Term Loan was 9.9 %.

As of December 31, 2023, principal repayments under the 2022 Term Loan are as follows:

As of December 31, 2024, future principal repayments under the 2024 Term Loan are as follows:

Years ended December 31,

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Some of the Company’s existing investors participated in the 2026 Convertible Notes offering.

In connection with the issuance of the 2026 Convertible Notes, the Company incurred approximately $ 5,473 of debt issuance costs, which primarily consisted of underwriting, legal and other professional fees.

The 2026 Convertible Notes are senior unsecured obligations and bear interest at a rate of 2.625 % per year payable semi-annually in arrears on February 15 and August 15 of each year, beginning on August 15, 2020.

Before August 15, 2025, noteholders will have the right to convert their notes only upon the occurrence of certain events.

From and after August 15, 2025, noteholders may convert their notes at any time at their election until the close of business on the scheduled trading day immediately before the maturity date.

The Company will settle conversions by paying or delivering, as applicable, cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the Company’s election.

The 2026 Convertible Notes will mature on February 15, 2026, unless earlier repurchased, redeemed or converted.

The initial conversion rate is 34.2618 shares of common stock per $1 principal amount of the 2026 Convertible Notes, which represents an initial conversion price of approximately $ 29.19 per share of common stock.

The conversion rate and conversion price are subject to adjustment upon the occurrence of certain events.

Holders of the 2026 Convertible Notes may convert all or any portion of their 2026 Convertible Notes, in multiples of $1 principal amount, at their option only under the following circumstances:

(1) during any calendar quarter commencing after the calendar quarter ending on March 31, 2020, if the last reported sale price per share of the Company’s common stock exceeds 130 % of the conversion price for at least 20 trading days during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter;

(2) during the five consecutive business days immediately after any 10 consecutive trading day period (such 10 consecutive trading day period, the “measurement period”) in which the “trading price” per $1 principal amount of the 2026 Convertible Notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price per share of the Company’s common stock on such trading day and the conversion rate on such trading day;

(3) upon the occurrence of certain corporate events or distributions on the Company’s common stock;

(4) if the Company calls the 2026 Convertible Notes for redemption;

(5) at any time from, and including, August 15, 2025 until the close of business on the scheduled trading day immediately before the maturity date.

As of December 31, 2023, none of the above circumstances had occurred and as such, the 2026 Convertible Notes could not have been converted.

The Company did not have the right to redeem the 2026 Convertible Notes prior to February 15, 2023.

On or after February 15, 2023, the Company may redeem the 2026 Convertible Notes, in whole and not in part, at a cash redemption price equal to the principal amount of the 2026 Convertible Notes to be redeemed, plus accrued and unpaid interest, if any, only if the last reported sale price per share of the Company’s common stock exceeds 130 % of the conversion price on:

(1) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related redemption notice;

(2) the trading day immediately before the date the Company sends such notice.

Calling any 2026 Convertible Notes for redemption will constitute a make-whole fundamental change, in which case the conversion rate applicable to the conversion of any 2026 Convertibles Notes, if converted in connection with the redemption, will be increased in certain circumstances for a specified period of time.

The 2026 Convertible Notes have customary default provisions, including:

(i) a default in the payment when due (whether at maturity, upon redemption or repurchase upon fundamental change or otherwise) of the principal of, or the redemption price or fundamental change repurchase price for, any note; (ii) a default for 30 days in the payment when due of interest on any note; (iii) a default in the Company’s obligation to convert a note in accordance with the indenture, if such default is not cured within 3 calendar days after its occurrence;

(iv) a default with respect to the Company’s obligations under the indenture related to consolidations, mergers and asset sales;

(v) a default in any of the Company’s other obligations or agreements under the indenture that are not cured or waived within 60 days after notice to the Company;

(vi) certain payment defaults by the Company or certain subsidiaries with respect to mortgages, agreements or other instruments for indebtedness for money borrowed of at least $ 20,000 or other defaults by the Company or certain subsidiaries with respect to such indebtedness that result in the acceleration of such indebtedness;

(vii) default upon the occurrence of one or more final judgments being rendered against the Company or any of the Company's significant subsidiaries for the payment of at least $ 20,000 ;

and (viii) certain events of bankruptcy, insolvency and reorganization with respect to the Company or any of its significant subsidiaries.

Repurchase of a Portion of the 2026 Convertible Notes

Contemporaneously with the offering of the 2029 Convertible Notes (as defined below), the Company entered into separate privately negotiated transactions with certain holders of the 2026 Convertible Notes to repurchase $ 117,400 aggregate principal amount of the 2026 Convertible Notes for an aggregate of $ 140,100 of cash, which includes accrued

and unpaid interest on the 2026 Convertible Notes to be repurchased.

Repurchase of a Portion of the 2026 Convertible Notes in 2023

Contemporaneously with the offering of the 2029 Convertible Notes in February 2023 (as described below), the Company entered into separate privately negotiated transactions with certain holders of the 2026 Convertible Notes to repurchase $ 117,400 aggregate principal amount of the 2026 Convertible Notes for an aggregate of $ 140,100 of cash, which includes accrued and unpaid interest on the 2026 Convertible Notes to be repurchased.

This transaction involved a contemporaneous exchange of cash between the Company and holders of the 2026 Convertible Notes participating in the issuance of the 2029 Convertible Notes.

2 unchanged sentences

Therefore, the repurchase of the 2026 Convertible Notes was accounted for as a debt extinguishment.

The Company recorded a $ 23,504 loss on early extinguishment of debt on the consolidated statements of operations during the three months ending March 31, 2023, which includes the recognition of previously deferred financing costs of $ 2,264 .

The total remaining principal amount outstanding under the 2026 Convertible Notes as of December 31, 2023 was $ 26,350 .

The Company recorded a $ 23,504 loss on early extinguishment of debt on the consolidated statements of operations during the year ended December 31, 2023, which includes the recognition of previously deferred financing costs of $ 2,264 .

The total remaining principal amount outstanding under the 2026 Convertible Notes following the repurchase was $ 26,350 .

Redemption of Remaining 2026 Convertible Notes in 2024

On April 11, 2024, the Company provided notice of redemption for the remaining $ 26,350 aggregate principal amount of its outstanding 2026 Convertible Notes.

The 2026 Convertible Notes were fully redeemed on June 18, 2024.

The Company settled all conversions of the 2026 Convertible Notes in cash.

In accordance with ASC 470-50, Debt – Modifications and Extinguishments, the Company accounted for the redemption of the 2026 Convertible Notes as a debt extinguishment.

The Company paid $ 33,218 to settle the 2026 Convertible Notes, as well as accrued and unpaid interest of $ 229 .

The Company recorded a $ 7,184 loss on extinguishment of debt on the consolidated statements of operations during the year ended December 31, 2024, which includes recognition of previously deferred financing costs of $ 289 and miscellaneous costs of redemption of $ 27 .

2029 Convertible Notes

On February 10, 2023, the Company issued 2.875 % convertible senior notes due in 2029 (the “2029 Convertible Notes”) in the aggregate principal amount of $ 241,500 , in a private offering to qualified institutional buyers pursuant to Section 4(a)(2) and Rule 144A under the Securities Act of 1933, as amended.

The 2029 Convertible Notes were issued to finance the concurrent repurchase of a portion of the 2026 Convertible Notes, and the remainder of the net proceeds may be used for general corporate purposes.

The 2029 Convertible Notes were issued to finance the concurrent repurchase of a portion of the 2026 Convertible Notes, and the remainder of the net proceeds were used

for general corporate purposes.

In connection with the issuance of the 2029 Convertible Notes, the Company incurred approximately $ 6,280 of debt issuance costs, which primarily consisted of underwriting, legal and other professional fees.

26 unchanged sentences

and (xiii) upon the occurrence of certain events of bankruptcy, insolvency and reorganization with respect to the Company or any of its significant subsidiaries.

The 2026 Convertible Notes and 2029 Convertible Notes (together, the “Convertible Notes”) are classified on the consolidated balance sheets as of December 31, 2023 as convertible senior notes.

As of December 31, 2023, the Convertible Notes outstanding consisted of the following:

2026 Convertible Notes

The 2029 Convertible Notes are classified on the consolidated balance sheets as of December 31, 2024 as convertible senior notes.

As of December 31, 2024, the convertible senior notes outstanding consisted of the following:

2029 Convertible Notes

Total Convertible Notes

unamortized issuance costs

Net carrying amount

The Company determined the expected life of the 2026 Convertible Notes and 2029 Convertible Notes was equal to the six-year term of each.

The effective interest rate on the 2026 Convertible Notes and 2029 Convertible Notes is 3.34 % and 3.28 %, respectively.

The Company determined the expected life of the 2029 Convertible Notes was equal to the six-year term.

The effective interest rate on the 2029 Convertible Notes is 3.28 %.

As of December 31, 2024, the if-converted value did not exceed the remaining principal amount of the 2029 Convertible Notes.

The following table presents the total interest expense recognized related to the Convertible Notes during the years ended December 31, 2023, 2022, and 2021:

The following table presents the total interest expense recognized related to the 2026 Convertible Notes and 2029 Convertible Notes during the years ended December 31, 2024, 2023, and 2022:

Years Ended December 31,

5 unchanged sentences

2029 Convertible Notes

Total Convertible Notes

Total minimum payments

1 unchanged sentence

Convertible Notes carrying value

Deferred Royalty Obligation

The Company’s deferred royalty obligation is a debt obligation of Ironshore that was assumed as part of the Ironshore Acquisition.

The deferred royalty obligation relates to royalty payments on net sales of Jornay that are paid to debtholders in exchange for funding provided to Ironshore by its debtholders.

The royalty rate is 7.4 % for net sales prior to July 1, 2025 and 9.7 % thereafter through March 2032.

The royalty payments are an unsecured obligation of the Company and there are no financial covenants or other restrictive covenants.

The royalty payments are to be made semi-annually in February and August of each year based on the sales of Jornay in the prior six-month calendar year period.

The deferred royalty obligation will be accreted to the estimated future royalty payments over the life of the agreement, which will be recorded as interest expense using the effective interest rate.

The carrying value of the obligation will decrease for royalty payments made based upon the actual Jornay sales and the related royalty payments.

The effective interest rate is calculated based on current estimates of future royalty payments over the life of the arrangement.

The effective interest rate as of December 31, 2024 was approximately 15.2 %.

A rollforward of the deferred royalty obligation is as follows:

Deferred Royalty Obligation

Acquired balance as of September 3, 2024

Accretion interest expense

Payments made

Net carrying amount

The total interest expense recognized related to the deferred royalty obligation during year ended December 31, 2024 was $ 5,795 .

Operating Lease Arrangements

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The initial annual base rent is $ 1,214 , subject to annual increases between 2.5 % to 3.1 %.

As of December 31, 2023, the Company's operating lease assets totaled $ 6,029 and operating lease liabilities amounted to $ 7,112 .

This primarily relates to the corporate headquarters lease, with other immaterial operating and embedded operating leases accounted for in the normal course of business.

In connection with the Ironshore Acquisition, the Company acquired an operating lease for the U.S.

headquarters of Ironshore pursuant to which the Company leases 8,817 of rentable square feet of space in Durham, North Carolina (the “Ironshore Lease”).

The Ironshore Lease continues through February 2028.

As of December 31, 2024, the Company's operating lease assets totaled $ 5,822 and operating lease liabilities totaled $ 6,810 .

This primarily relates to the Company’s corporate headquarters lease in Stoughton, Massachusetts and the Ironshore Lease.

Short-Term Lease Arrangements

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The Company’s qualified incentive stock options, non-qualified options and restricted stock units generally vest ratably over a four-year period of service.

The stock options generally have a ten-year contractual life and, upon termination, vested options are generally exercisable between one and three months following the termination date, while unvested options are forfeited

immediately upon termination.

Shares issued under all of the Company’s plans are funded through the issuance of new shares.

4 unchanged sentences

In November 2022, the Warrant was exercised through a cashless exercise and the Company issued 40,666 shares.

As of December 31, 2023, there were no outstanding warrants remaining.

Share Repurchases

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Repurchased shares were returned to the Company’s pool of authorized but unissued shares.

The cost of repurchased shares were recorded as treasury stock in the consolidated balance sheet.

repurchased shares were recorded as treasury stock in the consolidated balance sheet.

Shares repurchased under the Prior Repurchase Program resulted in an immediate reduction of shares outstanding used to calculate the weighted-average common shares outstanding for both basic and diluted earnings per share.

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In January 2024, the Company’s Board of Directors authorized the repurchase of up to $ 150,000 of the Company’s common stock through June 30, 2025 (the “2024-2025 Repurchase Program”).

The 2024-2025 Repurchase Program permits the Company to effect repurchases through a variety of methods, including open-market purchases (including pursuant to a trading plan adopted in accordance with Rule 10b5-1 of the Exchange Act), privately negotiated transactions, or otherwise in compliance with Rule 10b-18 of the Exchange Act.

The 2024-2025 Repurchase Program permits the Company to effect repurchases through a variety of methods, including open-market purchases (including

pursuant to a trading plan adopted in accordance with Rule 10b5-1 of the Exchange Act), privately negotiated transactions, or otherwise in compliance with Rule 10b-18 of the Exchange Act.

The timing and amount of any shares purchased on the open market will be determined based on the Company’s evaluation of the market conditions, share price and other factors.

The Company plans to utilize existing cash on hand to fund share repurchases.

In May 2024, the Company’s Board of Directors authorized an ASR program to repurchase $ 35,000 of the Company’s common stock, as part of the 2024-2025 Repurchase Program.

Under the terms of the Company’s ASR agreement with an investment bank, the Company paid $ 35,000 on May 13, 2024, and received 888,889 shares, representing 80 % of the upfront payment on a price per share of $ 31.50 , the closing price on the date the agreement was executed.

The remaining shares to be purchased by the Company was to be based on the volume-weighted average price of its common stock through July 31, 2024, minus an agreed upon discount between the parties.

In July 2024, the ASR agreement settled and the Company received an additional 173,659 shares, bringing the total shares repurchased pursuant to the ASR agreement to 1,062,548 .

The ASR agreement was accounted for as two distinct transactions:

(1) an immediate repurchase of common stock, recorded as a treasury stock transaction;

and (2) a forward contract indexed to the Company’s own stock.

The forward contracts, which represented the remaining shares to be delivered by the investment bank, were recorded as a reduction to stockholders’ equity.

Both forward contracts associated with this ASR agreement were settled and not outstanding as of December 31, 2024.

As of December 31, 2024, the Company repurchased 1,882,702 shares at a weighted-average price of $ 31.88 per share for a total of $ 60,025 , inclusive of $ 25 of fees and commissions, under the 2024-2025 Repurchase Program and the cost of repurchased shares was recorded as treasury stock in the consolidated balance sheet.

As of December 31, 2024, $ 90,000 remained available for share repurchases under the 2024-2025 Repurchase Program.

Stock-based Compensation

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PSUs vest subject to the satisfaction of annual and cumulative performance and/or market conditions established by the Compensation Committee.

In January 2019, the Company granted PSUs with performance conditions related to 2019, 2020, 2021 and three-year cumulative revenue goals for Xtampza ER.

The PSUs were to vest following a three-year performance period, subject to the satisfaction of the performance criteria and the executive’s continued employment through the performance period.

PSUs may vest in a range between 0 % and 200 %, based on the satisfaction of performance criteria, and no shares will be issued if the minimum applicable performance metric is not achieved.

The Company recognizes compensation expense ratably over the required service period based on its estimate of the number of shares that will vest based upon the probability of achieving the performance metrics.

During the year ended December 31, 2021, the Company adjusted cumulative compensation expense based on the number of shares that vested.

Beginning in February 2020 and each year thereafter, the Company granted PSUs with performance criteria related to the relative ranking of the total stockholder return (“TSR”) of the Company’s common stock for each individual year within a three-year performance period as well as the cumulative three-year performance period return relative to the TSR of certain peer companies within the S&P Pharmaceutical Select Industry Index.

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The weighted-average grant date fair value of PSUs granted for the years ended December 31, 2024, 2023, and 2022 was $ 44.15 , $ 38.71 , and $ 24.12 , respectively.

The total fair value of PSUs vested (measured on the date of vesting) for the years ended December 31, 2024, 2023, and 2022 was $ 17,433 , $ 5,970 , and $ 2,257 , respectively.

For the years ended December 31, 2024, 2023, and 2022, the stock-based compensation expense for PSUs was $ 5,037 , $ 7,037 , and $ 5,398 respectively.

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The expected term represents the period of time that options are expected to be outstanding.

Because the Company does not have historical exercise behavior through December 31, 2021, it determined the expected term assumption using the simplified method, which is an average of the contractual term of the option and its vesting period.

Because the Company does not have sufficient levels of historical exercise behavior through December 31, 2024, it determined the expected term assumption using the simplified method, which is an average of the contractual term of the option and its vesting period.

Expected Dividend Yield.

The expected dividend yield assumption is based on the fact that the Company has never paid cash dividends and has no present intention to pay cash dividends.

The Company did not grant stock options during the years ended December 31, 2023 and 2022.

The weighted-average grant date fair value of stock options granted for the year ended December 31, 2024 was $ 17.10 .

The Company did not grant stock options during the years ended December 31, 2023 and 2022.

The total intrinsic value of stock options exercised for the years ended December 31, 2024, 2023 and 2022 was $ 6,833 , $ 4,786 , and $ 3,943 , respectively.

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Effective income tax rate

During the year ended December 31, 2023, the effective tax rate was impacted by permanent differences, including the extinguishment of debt in connection with the repurchase of a portion of the Company’s 2026 Convertible Notes, for which certain extinguishment costs were not deductible for tax purposes.

During the years ended December 31, 2024 and 2023, the effective tax rate was impacted by permanent differences, including the extinguishment of the Company’s 2026 convertible notes, for which certain extinguishment costs were not deductible for tax purposes.

Stock compensation, including the impact of excess benefits and 162(m) limitations, impacted the effective tax rate at varying percentages each year due to changes in the non-deductible amount and profit before tax.

In addition, during the year ended December 31, 2022, non-deductible transaction costs resulting from the BDSI Acquisition impacted the effective tax rate.

During the year ended December 31, 2021, the Company released the valuation allowance on the majority of its net operating losses, resulting in a significant discrete deferred tax benefit that impacted the effective tax rate.

During the year ended December 31, 2022, non-deductible transaction costs resulting from the BDSI Acquisition impacted the effective tax rate.

Deferred taxes are recognized for temporary differences between the basis of assets and liabilities for financial statement and income tax purposes.

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Deferred tax assets:

and state net operating loss carryforwards

Net operating loss carryforwards

Research and development credits

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Intangible assets

Deferred royalty obligation

Gross deferred tax assets:

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In determining the extent to which a valuation allowance for deferred tax assets is required, the Company evaluates all available evidence including projections of future taxable income, carryback opportunities, reversal of certain deferred tax liabilities, and other tax planning strategies.

The Company maintains a partial valuation against its federal and state operating losses and federal R&D credits as of December 31, 2023.

The Company maintains a partial valuation against its federal, state, and international operating losses and federal R&D credits as of December 31, 2024.

The valuation allowance was $ 6,498 and $ 5,781 as of December 31, 2024 and 2023, respectively, and reflects limitations based on the Company’s ability to use such assets prior to expiration.

The change in the valuation allowance increased the tax provision by $ 527 for the year ended December 31, 2023.

The change in valuation allowance did not impact the tax provision for the year ended December 31, 2022.

As a result of sustained positive earnings history through cumulative earnings over the prior three years, as of June 30, during the year ended December 31, 2021, the Company began using projections of future taxable income as a source of realizing its deferred tax assets.

Accordingly, the Company recognized a deferred tax benefit of $ 78,042 for the year ended December 31, 2021 related to the reversal of valuation allowances.

The change in the valuation allowance increased the tax provision by $ 431 and $ 527 for the years ended December 31, 2024 and 2023.

The change in valuation allowance did no t impact the tax provision for the year ended December 31, 2022.

The change in the valuation allowance for the year ended December 31, 2024 was $ 717 , including $ 287 recorded through purchase accounting.

The Tax Cuts and Jobs Act of 2017 (“TCJA”) will generally allow losses incurred after 2017 to be carried over indefinitely but will generally limit the net operating loss (“NOL”) deduction to the lesser of the NOL carryover or 80% of a corporation’s taxable income (subject to Internal Revenue Code Sections 382 and 383).

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state net operating loss carryforwards of $ 198,986 and $ 202,381 , respectively, which may be available to offset future income tax liabilities and expire at various dates through 2037.

As of December 31, 2023 and 2022, the Company had federal research and development tax credit carryforwards of approximately $ 1,025 and $ 4,231 , respectively, available to reduce future tax liabilities which expire at various dates through 2032.

As of December 31, 2023 and 2022, the Company had state research and development tax credit carryforwards of approximately $ 672 and $ 832 , respectively, available to reduce future tax liabilities which expire at various dates through 2036.

As of December 31, 2024 and 2023, the Company had federal research and development tax credit carryforwards of approximately $ 1,025 .

As of December 31, 2024, the Company did no t have any state research and development tax credit carryforwards.

As of December 31, 2023, the Company had state research and development tax credit carryforwards of approximately $ 672 .

The Company has completed studies to assess the impact of ownership changes, if any, on the Company’s ability to use its NOL and tax credit carryovers as defined under Section 382 of the Internal Revenue Code (“IRC 382”).

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As of December 31, 2024, remaining net operating losses of $ 90,062 are subject to limitation.

The Company also acquired $ 1,092 of Canadian operating losses as part of the Ironshore Acquisition on which the Company has recorded a full valuation allowance.

The Company files income tax returns in the United States and in several states.

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Total expense for contributions made by the Company for the years ended December 31, 2024, 2023 and 2022 was $ 1,945 , $ 1,759 , and $ 1,315 , respectively.

Segment Information

The Company’s product portfolio includes Jornay, Belbuca, Xtampza ER, Nucynta IR and Nucynta ER, and Symproic.

The Company defines its segments on the basis of the way in which internally reported financial information is regularly reviewed by the chief operating decision maker (“CODM”) to analyze financial performance, make decisions, and allocate resources.

The CODM is the Chief Executive Officer.

As the internal reporting is based on the consolidated results, the Company has identified one operating and reportable segment and the measure of segment profit or loss is consolidated net income (loss).

The CODM uses net income (loss) to assess actual results and considers budget-to-actual variances on a quarterly basis when making decisions about the allocation of operating and capital resources.

The financial information regularly provided to the CODM includes consolidated cost of sales information and segment expense categories at a more disaggregated level than the consolidated statement of operations.

The significant segment expenses for functional areas exclude stock-based compensation and certain other segment expenses, and are reported for the following functional areas:

corporate, medical, technical operations, and commercial.

The corporate functional area includes operating expenses related to finance, legal, business development, and other administrative activities, excluding stock-based compensation and other segment expenses (“Corporate Expenses”).

The medical functional area includes operating expenses related to medical affairs, regulatory, pharmacovigilance and other medical-related activities, excluding stock-based compensation and other segment expenses (“Medical Expenses”).

The technical operations functional area includes non-inventoriable operating expenses related to supply chain, product quality, information technology and other technical activities, excluding stock-based compensation and other segment expenses (“Technical Operations Expenses”).

The commercial function includes operating expenses related to sales, marketing, market access, and other commercial activities, excluding stock-based compensation and other segment expenses (“Commercial Expenses”).

Stock compensation is a significant segment expense and other segment expenses are included in Other segment items or separately stated in the table below.

The table below provides information about the Company’s segment, including segment expenses, and a reconciliation to net income (loss):

Years Ended December 31,

Product revenues, net

Cost of product revenues (excluding intangible asset amortization)

Intangible asset amortization and impairment

Commercial expenses

Corporate expenses

Medical expenses

Technical operations expenses

Stock-based compensation expense

Other segment items (1)

Interest expense

Interest income

Loss on extinguishment of debt

Provision for (benefit from) income taxes

Net income (loss)

(1) – Other segment expenses are primarily acquisition-related expenses, expenses related to the Company’s CEO transition, litigation settlements, and fair value remeasurement of contingent consideration.

Depreciation expense was $ 3,856 , $ 3,496 and $ 2,684 in the years ended December 31, 2024, 2023 and 2022, respectively.

Intangible asset amortization and impairment expense was $ 165,304 , $ 145,760 and $ 136,255 in the years ended December 31, 2024, 2023 and 2022.

Unaudited Quarterly Operating Results

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Selling, general and administrative

Gain on fair value remeasurement of contingent consideration

Total operating expenses

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Loss on extinguishment of debt

(Loss) income before income taxes

(Benefit from) provision for income taxes

Net (loss) income

(Loss) earnings per share — basic

Income (loss) before income taxes

Provision for income taxes

Earnings (loss) per share — basic

Weighted-average shares — basic

(Loss) earnings per share — diluted

Earnings (loss) per share — diluted

Weighted-average shares — diluted

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Operating expenses

Research and development

Selling, general and administrative

Total operating expenses

(Loss) income from operations

Income from operations

Interest expense

Interest income

Loss on extinguishment of debt

(Loss) income before income taxes

(Benefit from) provision for income taxes

Net (loss) income

(Loss) earnings per share — basic

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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 9A. Controls and Procedures