What changed in this filing

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Item 1. Business

2026-03-26 compared with 2025-03-27 · 98 added, 99 removed, 476 unchanged (29% of the section changed)

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2025 Highlights and Events

On November 1, 2024, the FDA approved Emrosi TM (Minocycline Hydrochloride Extended Release Capsules, 40 mg), formerly referred to as DFD-29 (“Emrosi”), for the treatment of inflammatory lesions of rosacea in adults.

On November 1, 2024, the FDA approved Emrosi for the treatment of inflammatory lesions of rosacea in adults.

Emrosi was developed by Journey in collaboration with Dr.

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Our initial supply became available in March 2025.

In addition, the initial distribution of Emrosi to pharmacies is ongoing and the first Emrosi prescriptions have been filled.

We anticipate sales promotion of Emrosi beginning in April 2025.

We intend to commercialize Emrosi in the U.S.

We began sales promotion of Emrosi beginning in April 2025, and we are commercializing Emrosi in the U.S.

with our existing commercial team.

Effective after the close of U.S.

equity markets on June 27, 2025, we joined the small cap Russell 2000® Index and the broad-market Russell 3000® Index as a result of the 2025 annual Russell Index reconstitution.

CORPORATE INFORMATION

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We maintain a website with the address www.jmcderm.com.

We make available free of charge through our website our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and any amendments to these reports, as soon as reasonably practicable after we electronically file such material with, or furnish such material to, the SEC.

We are not including the information on our website as a part of, nor incorporating it by reference into, this report.

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Our Market, Products and Relevant Disease States

Our major marketed products, which have been approved by the FDA for sale in the United States, include:

● Emrosi TM (Minocycline Hydrochloride Extended Release Capsules, 40 mg for the treatment of inflammatory lesions of rosacea in adults), approved by the FDA in November 2024, sales promotion beginning in April 2025.

Our major actively marketed products, which have been approved by the FDA for sale in the United States, include:

● Qbrexza® (a medicated cloth towelette for the treatment of primary axillary hyperhidrosis in patients nine years of age and older), acquired and launched in May 2021;

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● Zilxi® (minocycline) topical foam, 1.5% (a topical minocycline treatment for inflammatory lesions of rosacea in adults), acquired and launched in January 2022;

● Exelderm® Cream and Solution (a broad-spectrum antifungal intended for topical use), acquired and launched in October 2018;

● Targadox® (an oral doxycycline drug for adjunctive therapy for severe acne), licensed in March 2015 and launched in October 2016;

● Luxamend® (a water-based emulsion formulated to provide an optimally moist healing environment for superficial wounds;

In addition to our actively marketed products, we also have a portfolio of legacy products that we continue to sell, including:

Exelderm® Cream and Solution (a broad-spectrum antifungal intended for topical use), Targadox® (an oral doxycycline drug for adjunctive therapy for severe acne), and Luxamend® (a water-based emulsion formulated to provide an optimally moist healing environment for superficial wounds;

minor cuts or scrapes;

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first- and second-degree burns, including sunburns;

and radiation dermatitis), acquired in 2021 and launched in 2023.

and radiation dermatitis).

Rosacea and the Current Standard of Care

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The tetracycline class of antibiotics (minocycline and doxycycline) are considered to be effective options for the treatment of papulopustular rosacea.

Oral doxycycline (40mg) has been approved for the treatment of only inflammatory lesions (papules and pustules) of rosacea and is available under the proprietary name Oracea ® (Galderma L.P.) in the US.

Oracea is generally considered to be the current standard of care.

Oracea was the most prescribed oral doxycycline brand for rosacea for the last 20 years.

Minocycline is widely believed to be the most effective tetracycline agent due to its high lipophilicity, which is anticipated to permit greater permeation into, and accumulation in, the sebaceous follicles and layers of the epidermis.

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Emrosi 40mg is now the lowest-dose approved oral minocycline hydrochloride approved by the FDA.

It was developed using Multiple Unit Pellet System technology, which combines Immediate Release (25%) and Extended Release (75%) Minocycline pellets for uniform drug release.

Emrosi has shown superiority to Oracea and Placebo on the co-primary endpoints and all secondary endpoints in two phase 3 studies and was well-tolerated.

The NDA was filed under Section 505(b)(2) of the Food Drug and Cosmetic Act (“FDCA”) in January 2024 and was approved in November 2024 by the FDA (NDA 219015).

Emrosi has Orange Book-listed patents that extend through January of 2039.

It was developed using Multiple Unit Pellet System technology, which combines Immediate Release (10mg) and Extended Release (30mg) Minocycline pellets for uniform drug release.

Emrosi has shown statistical superiority to Oracea and Placebo on the co-primary endpoints and all secondary endpoints in two phase 3 studies and was well-tolerated.

The New Drug Application (the “NDA”) was filed under Section 505(b)(2) of the Food Drug and Cosmetic Act (“FDCA”) in January 2024 and was approved in November 2024 by the FDA.

Emrosi has three Orange Book-listed patents that extend through January of 2039.

The oral rosacea market had more than 1.5 million prescriptions in 2025 according to Symphony Health.

Zilxi for the Treatment of Rosacea

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We believe the anti-inflammatory properties of minocycline delivered in our innovative foam technology make Zilxi a highly appealing treatment option for rosacea patients.

Zilxi has Orange Book-listed patents that extend through October of 2030.

The topical rosacea market had more than 4.3 million prescriptions in 2024 while the oral rosacea market had more than 700,000 according to Symphony Health.

Zilxi has nine Orange Book-listed patents that extend through October of 2030.

The topical rosacea market had more than 4.7 million prescriptions in 2025 according to Symphony Health.

Excessive Underarm Sweating and the Current Standard of Care

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The exact cause of PAH is not known, and the disorder affects males and females equally.

When excessive sweating occurs as part of some other disorder, it is said to be secondary hyperhidrosis, which is a more commonly encountered condition than is primary hyperhidrosis.

When excessive sweating occurs as part of some other disorder, it is said to be secondary hyperhidrosis, which is a more commonly encountered condition than primary hyperhidrosis.

According to a 2016 article published in the Archives of Dermatological Research, there are approximately 10 million people who suffer from PAH in the United States.

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Qbrexza is applied directly to the skin and is designed to block underarm sweat production by inhibiting sweat gland activation.

Qbrexza has Orange Book-listed patents that extend through February of 2033.

Qbrexza has eight Orange Book-listed patents that extend through February of 2033.

The PAH market had approximately 560,000 prescriptions in 2025 according to Symphony Health, excluding over-the-counter (“OTC”) clinical strength anti-perspirants.

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Acne, also known as acne vulgaris, is a common skin disorder characterized by a blockage of hair follicles, which are clogged with oil and dead skin cells.

According to the American Academy of Dermatology (“AAD”), acne is the most common skin condition in the US, affecting up to 50 million individuals annually.

According to the American Academy of Dermatology, acne is the most common skin condition in the U.S., affecting up to 50 million individuals annually.

Approximately 85% of people between the ages of 12 and 24 experience at least a minor form of acne.

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Accutane belongs to a class of drugs that affects all four major pathogenic processes in acne:

increased sebum

production, irregular follicular desquamation, propionibacterium acnes proliferation and inflammation.

increased sebum production, irregular follicular desquamation, propionibacterium acnes proliferation and inflammation.

Accutane has achieved a strong market position and is well known in the dermatology community.

The oral isotretinoin market had just under 2.3 million prescriptions in 2024 according to Symphony Health.

The oral isotretinoin market had just over 2.3 million prescriptions in 2025 according to Symphony Health.

Targadox for the Treatment of Severe Acne

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We believe that the combination of a well-established antibiotic in a well-tolerated, easy to use foam makes Amzeeq a very attractive treatment option for patients.

The topical acne market had more than 23.5 million prescriptions in 2024 according to Symphony Health, presenting significant unmet needs of patients and healthcare providers to be addressed.

As the first topical minocycline to be approved by the FDA for any condition, we believe that Amzeeq may provide a new treatment alternative for patients and healthcare providers who are unsatisfied with their current therapies.

Amzeeq has 12 Orange Book-listed patents that extend through September of 2037.

The topical acne market had more than 24.8 million prescriptions in 2025 according to Symphony Health, presenting significant unmet needs of patients and healthcare providers to be addressed.

Fungal Infections of the Skin and the Current Standard of Care

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OTC products typically include known antifungal ingredients such as clotrimazole, miconazole, terbinafine or ketoconazole.

Prescription treatments are often reserved for more serious infection or for those in hard-to-treat areas.

Prescription treatments are often reserved for more serious infections or for those in hard-to-treat areas.

In conjunction with OTC or prescription medications, lifestyle adjustments, including daily washing of bedding and clothing during an infection, drying thoroughly after bathing, wearing loose clothing in affected areas and actively treating infected areas, can all contribute to disinfecting your surroundings and preventing a prolongation or recurrence of infection.

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Antihistamines are also effective in treating some types of itch, but they too have drawbacks with continued use.

We plan on launching our Anti-itch Product through our field sales force during the second half of 2025 or first half of 2026.

We plan on launching our Anti-itch Product through our field sales force during the first half of 2026.

Luxamend for Wound Healing

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We are in various stages of discussion for other opportunities, both commercial and development stage, that could drive additional growth in the business.

Successful development and commercialization of any future in-licensed development stage or commercial drugs will require us to navigate the many laws and regulations of governmental authorities and regulatory agencies around the world, including the FDA, relating to the manufacture, development, approval and commercialization of investigational drugs.

For development stage drugs, we may require financial resources significantly in excess of our current cash on hand, and it may take many years for us to receive marketing approval, if ever, for any in-licensed or acquired product candidate.

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We continue to seek to enhance our product line and develop a portfolio of differentiated products through product acquisitions and in-licensing or acquiring rights to products and technologies from third parties.

We intend to enter into strategic alliances and collaborative

arrangements with third parties, which will give us rights to develop, manufacture, market and/or commercialize pharmaceutical products, the rights to which are primarily owned by these third parties.

We intend to enter into strategic alliances and collaborative arrangements with third parties, which will give us rights to develop, manufacture, market and/or commercialize pharmaceutical products, the rights to which are primarily owned by these third parties.

These alliances and arrangements can take many forms, including licensing arrangements, co-development and co-marketing agreements, co-promotion arrangements, research collaborations and joint ventures.

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Employees and Human Capital Management

We currently employ 41 individuals, all of whom are full-time employees.

We have 34 employees in sales and marketing, 19 employees in general and administrative positions, and 3 employees were utilized in research and development positions during 2024.

As of March 18, 2026, we had 58 employees, all of whom are full-time employees.

39 of these employees are in sales and marketing and 19 employees in general and administrative positions.

Additionally, we have retained a number of expert advisors and consultants that help us navigate through different aspects of our business.

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In general, all of our product revenues are generated from operations or otherwise earned within the U.S.

During 2023, we received a one-time upfront license payment totaling $19.0 million from Maruho Ltd., our exclusive licensing partner in Japan (“Maruho”), under the license agreement we entered into with Maruho, dated August 31, 2023 (the “New License Agreement”) in which we granted Maruho exclusive rights to Qbrexza in Korea and other Asian countries.

During 2025, we began supplying Cutia Therapeutics (HK) Limited (“Cutia”) with Amzeeq for sale in the People’s Republic of China (the “PRC”).

We recognized Other revenue during 2025 associated with the supply of Amzeeq to Cutia and royalties earned on net sales made by Cutia in the PRC.

Seasonality of Business

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in the first calendar year in which annual sales reach each of $100 million, $200 million, $300 million, $400 million and $500 million, we will be required to make a one-time payment of $10 million, $20 million, $30 million, $40 million and $50 million, respectively, in that year only, per product, totaling up to $450.0 million.

In addition, Journey will pay Vyne 10% of any upfront payment received by Journey from a licensee or sublicensee of the products in any territory outside of the United States, subject to exceptions for certain jurisdictions as detailed in the Vyne APA.

In addition, Journey will pay Vyne 10% of any upfront payment received by Journey from a licensee or sublicensee of the products in any territory outside of the U.S., subject to exceptions for certain jurisdictions as detailed in the Vyne APA.

There are no subsequent milestone payments or royalties beyond the aforementioned payments.

The Acquisition included two FDA-approved products (Amzeeq and Zilxi), and a development-stage dermatology program (FCD105), along with the Molecule Stabilizing Technology proprietary platform.

Emrosi TM (formerly DFD-29)

On June 29, 2021, we entered into a license, collaboration, and assignment agreement with DRL to obtain the global rights for the development and commercialization of Emrosi TM (“Emrosi”), a late-stage development modified release oral minocycline that is being evaluated for the treatment of inflammatory lesions of rosacea (the “Emrosi Agreement”).

Emrosi (formerly DFD-29)

On June 29, 2021, we entered into a license, collaboration, and assignment agreement with DRL to obtain the global rights for the development and commercialization of Emrosi, a late-stage development modified release oral minocycline that is being evaluated for the treatment of inflammatory lesions of rosacea (the “Emrosi Agreement”).

We acquired global rights to Emrosi, including in the U.S.

and Europe, except that DRL has retained certain rights to the program in select markets including Brazil, Russia, India, China and the Commonwealth of Independent States (“CIS”) countries.

and Europe, except that DRL has retained certain rights to the program in select markets including Armenia, Azerbaijan, Belarus, Brazil, Georgia, India, Kazakhstan, Kyrgyzstan, Moldova, the PRC, Russia, Taiwan, Tajikistan, Turkmenistan, Ukraine and Uzbekistan.

Pursuant to the Emrosi Agreement, we agreed to make an upfront payment of $10.0 million, comprised of a $2.0 million payment upon execution and $8.0 million which was paid on September 29, 2021, 90 days following execution.

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Royalties are subject to a 50% reduction in the event that a generic competitor launches in an applicable country where we market and sell the product.

Qbrexza Agreement

On March 31, 2021, we executed an asset purchase agreement for Qbrexza (the “Qbrexza APA”) with Dermira Inc.

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Rose U may terminate the license in certain circumstances if we experience certain insolvency events or if we commit a material breach of the license agreement or if we cause Rose U to be in material breach of its license agreement with Stiefel, subject in each case to applicable cure provisions.

Subject to earlier termination, the license agreement remains in effect until 15 years following the first commercial sale of a licensed product have elapsed or, if later, the date that the last patent or patent application in the licensed patent rights has expired or been revoked, invalidated or abandoned.

Subject to earlier termination, the license agreement remains in effect until 15 years following the first commercial sale of a licensed product has elapsed or, if later, the date that the last patent or patent application in the licensed patent rights has expired or been revoked, invalidated or abandoned.

As of December 31, 2025, the last-to-expire issued patent relating to Qbrexza that we license under the license agreement with Rose U expires in 2029.

Accutane Agreement

On July 29, 2020, we entered into a license and supply agreement for Accutane (the “Accutane Agreement”) with DRL.

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The agreement contains customary representations, warranties, and indemnities.

Each party may also terminate the Accutane Agreement for material breach by the other party or for certain bankruptcy or insolvency related events and we may terminate for upon 180 days written notice to the other party.

Each party may also terminate the Accutane Agreement for material breach by the other party or for certain bankruptcy or insolvency related events and we may terminate the Accutane Agreement upon 180 days written notice to the other party.

We commenced sales of this product in April 2021.

Anti-Itch Product Agreement

Anti-Itch Product

On December 18, 2020, we entered into an asset purchase agreement for our Anti-itch Product (the “Anti-itch APA”) with Sun Pharmaceutical Industries, Inc.

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There are no subsequent milestone payments or royalties beyond the aforementioned payments.

We intend to launch this product during the second half of 2025 or first half of 2026.

Exelderm Agreement

We intend to launch this product during the first half of 2026.

On August 31, 2018, we entered into an asset purchase agreement for Exelderm (the “Exelderm APA”) with Sun.

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We commenced sales of this product in August 2018.

Targadox Agreement

On March 10, 2015, we entered into a license and supply agreement (as amended) for Targadox® (the “Targadox Agreement”) with PuraCap International LLC n/k/a Caribe Holdings, Inc.

We made an upfront payment of $1.3 million.

Further payments will be made based on a revenue sharing arrangement and no additional licensing or milestone payments are required.

The term of the Targadox Agreement is ten years and automatically renews for three-year periods unless either party provides notice of its intent not to renew at least 180 days prior to the expiration of the applicable term.

Under our revenue sharing arrangement, we are entitled to retain a majority of the net profits and pay Caribe a portion of the net profits after deducting certain commercial, marketing and sales expenses during the term of the Targadox Agreement.

On May 21, 2025, we entered into a Manufacturing and Supply Agreement for Targadox (the “Targadox Agreement”) with Epic Pharma, LLC (“Epic”).

No royalties or upfront payment was made.

The term of the Targadox Agreement is three years and automatically renews for two-year periods unless either party provides notice of its intent not to renew at least 120 days prior to the expiration of the applicable term.

The Targadox Agreement contains customary representations, warranties, and indemnities.

Each party may also terminate the Targadox Agreement for material breach by the other party or for certain bankruptcy or insolvency related events.

We commenced sales of this product in October 2016.

We commenced sales of this product under a previous agreement with an affiliated entity of Epic, PuraCap International LLC n/k/a Caribe Holdings, Inc., in October 2016.

We commenced sales of this product in September 2025 under the Targadox Agreement.

Out - licensing Agreements

On August 31, 2023, we entered into the New License Agreement with Maruho, whereby we granted an exclusive license to Maruho to develop and commercialize Qbrexza® for the treatment of primary axillary hyperhidrosis in South Korea, Taiwan, Hong Kong, Macau, Thailand, Indonesia, Malaysia, Philippines, Singapore, Vietnam, Brunei, Cambodia, Myanmar and Laos.

Under the terms of the New License Agreement, in exchange for the exclusive rights to Qbrexza in the Territory, Maruho paid $19.0 million as a non-refundable upfront payment.

Maruho License Agreement

On August 31, 2023, we entered into the New License Agreement with Maruho Co.

(“Maruho”), whereby we granted an exclusive license to Maruho to develop and commercialize Qbrexza for the treatment of primary axillary hyperhidrosis in South Korea, Taiwan, Hong Kong, Macau, Thailand, Indonesia, Malaysia, Philippines, Singapore, Vietnam, Brunei, Cambodia, Myanmar and Laos.

Under the terms of the New License Agreement, in exchange for the exclusive rights to Qbrexza in Japan, Maruho paid $19.0 million as a non-refundable upfront payment.

Cutia License Agreement

In January 2022, as a part of the Vyne APA, we assumed a license agreement with Cutia Therapeutics (HK) Limited, a Hong Kong biopharmaceutical company with experience in developing pharmaceutical products in the greater China region (the “Cutia Agreement”).

In January 2022, as a part of the Vyne APA, we assumed a license agreement with Cutia, a Hong Kong biopharmaceutical company with experience in developing pharmaceutical products in the greater China region (the “Cutia Agreement”).

Pursuant to the agreement, Cutia was granted an exclusive license to obtain regulatory approval of and commercialize Amzeeq (topical 4% minocycline foam) and Zilxi (topical 1.5% minocycline foam) in mainland China, Taiwan, Hong Kong and Macau.

We have agreed to supply the finished Licensed Products to Cutia for clinical and commercial use at an agreed price.

On November 11, 2024, Cutia received marketing approval for topical 4% minocycline foam from the National Medical Products Administration (the “NMPA”) of the People’s Republic of China.

On November 11, 2024, Cutia received marketing approval for topical 4% minocycline foam from the National Medical Products Administration (the “NMPA”) of the PRC.

The approval triggered a $1.0 million dollar milestone payment to us.

Additionally, during 2025, we began supplying Amzeeq to Cutia and earning a royalty on net sales of Amzeeq made by Cutia.

Research and Development

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With regard to Emrosi, we own three issued U.S.

patents and one U.S.

continuation application, as well as one issued foreign patent (Mexico) and eight foreign pending patent applications (one in each of Australia, Canada, Europe, Japan, Korea, and South Africa;

and two in New Zealand) covering methods of treating an inflammatory skin condition by selecting and administering an oral composition comprising reduced dose of minocycline and the relevant pharmacokinetic parameters, and we intend to pursue composition-of-matter patents, where possible, and dosage and formulation patents, as well as method-of-use patents on novel indications for known compounds.

patents, one allowed application, and one U.S.

continuation application, as well as four issued foreign patents (one in each of Australia, Japan, Korea, and Mexico) and eight foreign pending patent applications (one in each of Australia, Canada, Europe, Japan, and South Africa;

and two in New Zealand) covering methods and/or compositions for treating an inflammatory skin condition by selecting and administering an oral composition comprising reduced dose of minocycline and the relevant pharmacokinetic parameters.

We have also filed an additional patent application directed to methods and compositions for treating rosacea which is currently pending as a U.S.

patent application and an International Patent Application (PCT).

The three issued U.S.

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We own or have an exclusive license to 20 issued U.S.

patents and 41 issued foreign patents, which include granted European patent rights that have been validated in selected European Patent Organization (“EPO”) member states (Switzerland, Germany, Spain, France, Great Britain, Ireland, and Italy), Australia, Canada, Mexico, Israel, Japan, Hong Kong, Korea, and New Zealand, Singapore, and South Africa, and six pending U.S.

patent applications, one pending Patent Cooperation Treaty application, and sixteen pending foreign patent applications.

Of these patents and patent applications:

There are 18 issued U.S.

patents, thirty seven issued foreign patents (AU, CA, selected EP member states, Mexico, Japan, Hong Kong, Korea, New Zealand, Singapore, and South Africa), two pending U.S.

patent applications and three pending foreign applications (in Israel and Hong Kong), all relating to Qbrexza.

patents and 38 issued foreign patents, which include granted European patent rights that have been validated in selected European Patent Office (“EPO”) member states (Switzerland, Germany, Spain, France, Great Britain (UK), Ireland, Italy), Australia, Canada, Mexico, Israel, Japan, Hong Kong, Korea, New Zealand, Singapore, and South Africa, as well as two pending U.S.

patent applications, and one pending foreign patent application, all relating to Qbrexza.

We own 16 of the issued U.S.

patents, both of the pending U.S.

patent applications, 20 of the issued foreign patents, and two of the pending foreign applications, and have exclusively licensed from Rose U worldwide rights to four of the issued U.S.

patents, 17 issued foreign patents, and one pending foreign patent application.

The issued Qbrexza patents contain claims directed to individually packaged wipes for the treatment of hyperhidrosis where the wipes contain a composition comprising Qbrexza or other related compounds, and methods of alleviating hyperhidrosis using such compositions and contain claims directed to compositions comprising Qbrexza or other related compounds, individually packaged wipes comprising such compositions, absorbent pads comprising Qbrexza pharmaceutical compositions and methods of treating hyperhidrosis with topical administration of Qbrexza or other related compounds.

patents, the one pending U.S.

patent application, 29 of the issued foreign patents, and the pending foreign application, and have exclusively licensed from Rose U worldwide rights to four of the issued U.S.

patents, and nine issued foreign patents.

The issued U.S.

and foreign patents relating to Qbrexza will expire between 2028 and 2033 and the pending U.S.

and foreign patent applications relating to Qbrexza, if issued, will expire between 2028 and 2034.

Amzeeq, Zilxi & the Molecular Stabilizing Technology Platform Patents

and foreign patents and applications relating to Qbrexza will expire between 2028 and 2033.

Amzeeq, Zilxi and the Molecular Stabilizing Technology Platform Patents

We own 30 issued U.S.

patents and twenty issued foreign patents, and nine pending U.S.

patents and 17 issued foreign patents, and five pending U.S.

patent applications, and two pending foreign patent applications.

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● There are 14 issued U.S.

patents, fifteen issued foreign patents (Australia, Canada, Europe, Israel, Mexico, United Kingdom, South Africa), six pending U.S.

patents, 14 issued foreign patents (Australia, Canada, Europe, Israel, Mexico, United Kingdom, South Africa), two pending U.S.

patent applications and one pending foreign application (Canada), all relating to Amzeeq.

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● There are 11 issued U.S.

patents, fifteen issued foreign patents (Australia, Canada, Europe, Israel, Mexico, United Kingdom, South Africa), four pending U.S.

patent applications and one pending foreign application (Canada), all relating to Zilxi.

patents, 14 issued foreign patents (Australia, Canada, Europe, Israel, Mexico, United Kingdom, South Africa), and two pending U.S.

patent applications, all relating to Zilxi.

The issued Zilxi patents contain claims directed to compositions and use of the compositions (method claims).

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and foreign patent applications relating to Zilxi will expire between 2030 and 2037.

● The other patents related to molecular stabilizing platform but not products directly are sixteen issued U.S.

patents, three pending U.S.

patent applications, and five issued foreign patents (Canada, Israel, and Mexico).

● The other patents related to molecular stabilizing platform but not products directly are 13 issued U.S.

patents, two pending U.S.

patent applications, three issued foreign patents (Canada, Israel, and Mexico), and one pending foreign application (Europe).

Additional Intellectual Property and Proprietary Right Protection

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In the event of litigation involving a third-party claim, an adverse outcome in the litigation could subject us to significant liabilities to such third party, require us to seek a license under the disputed rights of such third party, and/or require us to cease use of the technology.

Moreover, our breach of an existing license or failure to obtain a license to technology required to commercialize our products may seriously harm our business.

Moreover, our breach of an existing license or failure to obtain a license for technology required to commercialize our products may seriously harm our business.

We also may need to commence litigation to enforce any patents issued to us or to determine the scope and validity of third-party proprietary rights.

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Litigation is costly and time-consuming and there can be no assurance that our litigation expenses will not be significant in the future or that we will prevail in any such litigation.

See “Item 3 - Legal Proceedings” for additional information.

Pharmaceutical Industry

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Generic products generally face intense competition from other generic equivalents (including authorized generics) and therapeutically similar branded or generic products.

See “Item 3 - Legal Proceedings” for additional information.

Supply and Manufacturing

We have limited experience in manufacturing products for clinical or commercial purposes, and we currently do not have any internal manufacturing capabilities.

We currently rely upon multiple contract manufacturers to produce our products and clinical supply of product candidates and will continue to rely upon contract manufacturers for any current or future product candidates under current Good Manufacturing Practice (“cGMP”) regulations for use in pre-clinical and clinical activities.

We currently rely upon multiple contract manufacturers to produce our products and clinical supply of product candidates, some of which are located outside of the U.S., and will continue to rely upon contract manufacturers for any current or future product candidates under current Good Manufacturing Practice (“cGMP”) regulations for use in pre-clinical and clinical activities.

Due to the risks associated with reliance on third-party manufacturing, as part of our current and future strategy of licensing, acquiring, or the future development of assets, we currently, and will continue to, secure manufacturing agreements with either a counterparty to a transaction, with one or more of our contract manufacturers or additional contract manufacturers.

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● insufficient supply of the drug candidates;

● adverse medical events or side effects in treated patients;

● adverse events in treated patients;

● ineffectiveness of the drug candidates.

In addition, the FDA, equivalent foreign regulatory authority, or a data safety monitoring committee for a trial may place a clinical trial on hold or terminate it if it concludes that subjects are being exposed to an unacceptable health risk, or for futility.

Any drug is likely to produce some toxicity or undesirable side effects in animals and in humans when administered at sufficiently high doses and/or for a sufficiently long period of time.

Unacceptable toxicity or side effects may occur at any dose level at any time in the course of studies in animals designed to identify unacceptable effects of a drug candidate, known as toxicological studies, or clinical trials of drug candidates.

The appearance of any unacceptable toxicity or side effect could cause us or regulatory authorities to interrupt, limit, delay or abort the development of any of our drug candidates and could ultimately prevent approval by the FDA or foreign regulatory authorities for any or all targeted indications.

Any drug is likely to produce some toxicity or undesirable adverse events in animals and in humans when administered at sufficiently high doses and/or for a sufficiently long period of time.

Unacceptable toxicity or adverse events may occur at any dose level at any time in the course of studies in animals designed to identify unacceptable effects of a drug candidate, known as toxicological studies, or clinical trials of drug candidates.

The appearance of any unacceptable toxicity or adverse event could cause us or regulatory authorities to interrupt, limit, delay or abort the development of any of our drug candidates and could ultimately prevent approval by the FDA or foreign regulatory authorities for any or all targeted indications.

Sponsors of drugs may apply for a special protocol assessment (“SPA”) from the FDA.

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Thus approval of a Section 505(b)(2) NDA can be stalled until all the listed patents claiming the referenced product have expired;

until any non-patent exclusivity, such as exclusivity for obtaining approval of a New Chemical Entity (“NCE”), listed in its publication “Approved Drug Products with Therapeutic Equivalence Evaluations,” also referred to as the “Orange Book,” for the referenced product has expired;

until any non-patent exclusivity, such as exclusivity for obtaining approval of a New Chemical Entity, listed in its publication “Approved Drug Products with Therapeutic Equivalence Evaluations,” also referred to as the “Orange Book,” for the referenced product has expired;

and, in the case of a Paragraph IV certification and subsequent patent infringement suit, until the earlier of 30 months, settlement of the lawsuit or a decision in the infringement case that is favorable to the Section 505(b)(2) applicant.

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Final regulatory approval can only be granted if the FDA is assured that there is no new information that would affect final regulatory/ approval.

The FDA may request a Risk Evaluation and Mitigation Strategy (“REMS”), as part of an NDA, ANDA, 510(K) or BLA.

The FDA may request a REMS, as part of an NDA, ANDA, 510(K) or BLA.

The REMS typically contains some combination of post-marketing obligations of the sponsor to train prescribing physicians, monitor drug use, including off-label use, and conduct sufficient Phase 4 follow-up studies and registries to ensure the continued safe use of the drug.

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Drugs whose review was accelerated may carry additional restrictions on marketing activities, including the requirement that all promotional materials are pre-submitted to the FDA.

Claims exceeding those contained in approved labeling will constitute a violation of the FDCA.

Claims not consistent with approved labeling will constitute a violation of the FDCA.

Violations of the FDCA or regulatory requirements at any time during the product development process, approval process, or marketing and sale following approval may result in agency enforcement actions, including withdrawal of approval, recall, seizure of products, warning letters, untitled letters, Form 483s, injunctions, fines and/or civil or criminal penalties.

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The United States and many foreign jurisdictions have enacted or proposed legislative and regulatory changes affecting the healthcare system, including implementing cost-containment programs to limit the growth of government-paid healthcare costs, including price controls, restrictions on reimbursement and requirements for substitution of generic products for branded prescription drugs.

In the United States, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010

(the “Affordable Care Act”) was intended to broaden access to health insurance, reduce or constrain the growth of healthcare spending, enhance remedies against fraud and abuse, add transparency requirements for the healthcare and health insurance industries, impose new taxes and fees on the health industry and impose additional health policy reforms.

In the United States, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010 (the “Affordable Care Act”) was intended to broaden access to health insurance, reduce or constrain the growth of healthcare spending, enhance remedies against fraud and abuse, add transparency requirements for the healthcare and health insurance industries, impose new taxes and fees on the health industry and impose additional health policy reforms.

There have been significant ongoing judicial, administrative, executive and legislative efforts to modify or eliminate the Affordable Care Act.

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The Inflation Reduction Act of 2022 (the “IRA”) contains substantial drug pricing reforms, including the establishment of a drug price negotiation program within the U.S.

Department of Health and Human Services that would require manufacturers to charge a negotiated “maximum fair price” for certain selected drugs or pay an excise tax for noncompliance, the establishment of rebate payment requirements on manufacturers of certain drugs payable under Medicare Parts B and D to penalize price increases that outpace inflation, and requires manufacturers to provide discounts on Part D drugs.

Department of Health and Human Services (“HHS”) that would require manufacturers to charge a negotiated “maximum fair price” for certain selected drugs or pay an excise tax for noncompliance, the establishment of rebate payment requirements on manufacturers of certain drugs payable under Medicare Parts B and D to penalize price increases that outpace inflation, and requires manufacturers to provide discounts on Part D drugs.

Orphan drugs that treat only one rare disease are exempt from the IRA’s drug negotiation program.

Substantial penalties can be assessed for noncompliance with the drug pricing provisions in the IRA.

In May 2025, President Trump issued an executive order implementing the concept of most-favored nation pricing.

Under this order, the HHS, in coordination with other federal agencies, is directed to take actions to ensure that the price of prescription drugs paid by federal health insurers, including Medicare and Medicaid, is in line with the prices paid in comparably developed nations.

As an alternative to the Affordable Care Act, President Trump recently announced the Great Healthcare Plan.

As presented, the plan is intended to lower drug prices by increasing competition and benchmarking U.S.

drug prices to other countries, reduce insurance premiums by redirecting subsidies from insurers to individuals, increase accountability and transparency from insurers, and promote consumer choice by giving individuals more direct control over how healthcare dollars are spent.

Legislative and regulatory action will be required to fully implement the plan.

It is unclear how these proposed changes will impact our business and the pharmaceutical industry in general.

At the state level, legislatures have increasingly passed legislation and implemented regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

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PHRMA Code and April 3, 2003 Department of Health and Human Services Office of Inspector General, OIG Compliance Program for Pharmaceutical Manufacturers

Code and the Health and Human Services Office of Inspector General (“OIG”) Compliance Program requirements for Pharmaceutical Manufacturers.

We have established and implemented a corporate compliance program designed to prevent, detect and correct violations of state and federal healthcare laws, including laws related to advertising and promotion of our products that are in compliance with the PHRMA Code and the Health and Human Services Office of Inspector General (“OIG”) Compliance Program requirements for Pharmaceutical Manufacturers.

Healthcare Fraud, Waste and Abuse

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Violations of the federal Anti-Kickback Statute can result in significant criminal fines, exclusion from participation in Medicare and Medicaid and follow-on civil litigation, among other things, for both entities and individuals.

In October 2019, the OIG issued a proposed rule to, among other things, add new safe harbors for certain value-based arrangements.

Although the value-based proposals would not include pharmaceutical manufacturers among the entities that could permissibly enter into such contracting arrangements, the general trend toward outcomes and value-based contracts in the healthcare industry may continue.

It is possible that payors, among other customers, could push manufacturers for novel contracting approaches, including those that would incorporate value-based principles, and these efforts could affect our business.

The civil False Claims Act and similar state laws impose liability on any person or entity who, among other things, knowingly presents, or causes to be presented, a false or fraudulent claim for payment by a federal healthcare program.

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Other Healthcare Laws and Compliance Requirements

In the United States, our activities are potentially subject to regulation by various federal, state and local authorities in addition to the FDA, including the Centers for Medicare and Medicaid Services (formerly the Health Care Financing Administration), other divisions

of the United States Department of Health and Human Services, the United States Department of Justice and individual United States Attorney offices within the Department of Justice, and state and local governments.

Department of Justice and individual U.S.

Attorney offices within the Department of Justice, and state and local governments.

Drug Quality and Security Act (“DQSA”)

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Additionally, the DSCSA directs FDA to establish national licensure standards for wholesale distributors and third-party logistics providers, and requires these entities report licensure and other information to FDA annually.

The implementation and enforcement of complete unit level traceability of verifiable return serialization, including aggregation throughout the whole supply chain, is not required as of November 27, 2023.

The implementation and enforcement of complete unit level traceability of verifiable return serialization, including aggregation throughout the whole supply chain is also required.

Although the rule regarding wholesale distributor verification of saleable returned products does not directly apply to our Company, we are required to assist our wholesale distributor customers by setting in place mechanics that would allow for traceability of returns in the supply chain.

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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 1. Business