What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2024-02-29 compared with 2023-02-28 · 542 added, 511 removed, 1327 unchanged (44% of the section changed)

1 unchanged sentence

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, which are designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chairman and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Based on their evaluation as of December 31, 2022, our Chief Executive Officer and Chairman and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2022.

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page 81

Tab le of Contents

We maintain disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, which are designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Based on their evaluation as of December 31, 2023, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2023.

Management’s Report on Internal Control over Financial Reporting

1 unchanged sentence

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f).

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chairman and Chief Financial Officer, management conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2022, based on the criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, management conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2023, based on the criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Based upon the results of the evaluation, our management concluded that our internal control over financial reporting was effective as of December 31, 2023.

1 unchanged sentence

Changes in Internal Control over Financial Reporting

During the quarter ended December 31, 2022, our management integrated internal controls for the acquired Flexion business into our existing controls.

Other than the controls enhanced or implemented to integrate the Flexion business, there have been no changes in our internal control over financial reporting that occurred during the quarter ended December 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

During the quarter ended December 31, 2023, there have been no changes in our internal control over financial reporting that occurred that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page 85

Table of Content s

Other Information

(a) On February 26, 2024 (the “Effective Date”), the Company’s operating subsidiary, Pacira Pharmaceuticals, Inc.

(“PPI”), and Integrated Commercialization Solutions, LLC (“ICS”) entered into a Commercial Outsourcing Services Agreement (the “Agreement”) with respect to the warehousing, distribution, order management, data management and certain other services for EXPAREL, ZILRETTA and iovera°.

The Agreement replaces and supersedes all existing commercial outsourcing service agreements between the parties relating to the aforementioned services.

Pursuant to the Agreement, PPI appointed ICS as the exclusive provider of third-party logistics services for EXPAREL, ZILRETTA and iovera° and as a provider of certain additional services, in each case, in the United States, Guam, Puerto Rico and the United States Territories during the Term (as defined below).

The third-party logistics services include warehousing and inventory services as well as distribution services.

The additional services include, but are not limited to, invoicing and accounts receivable management, customer service and contract administration.

The Agreement became effective as of the Effective Date and will continue for an initial three-year term (the “Term”).

The Agreement may be extended upon written mutual agreement of the parties, with any such extension(s) to be negotiated in good faith within six-months prior to the expiration of the Term, subject to certain conditions set forth in the Agreement.

PPI and ICS each has mutual termination rights under the Agreement, subject to certain terms, conditions and notice requirements set forth in the Agreement.

Each party also has additional unilateral termination rights in the event of a breach or under certain circumstances.

PPI is also required to pay ICS certain compensation per month, commencing on the giving of a notice of termination by ICS to PPI, for the then-remaining months of the then-current Term (including any extension).

The Agreement contains customary representations, warranties, covenants and confidentiality provisions, and also contains mutual indemnification obligations.

The above summary does not purport to be a complete summary of the Agreement and is qualified in its entirety by reference to the Agreement, a copy of which is filed as Exhibit 10.23 to this Annual Report and is incorporated by reference herein.

(b) The following table shows the “Rule 10b5-1 trading arrangements” and “non-Rule 10b5-1 trading arrangements” (as each term is defined in Item 408(a) of Regulation S-K) terminated by our directors and executive officers during the quarter ended December 31, 2023.

No trading arrangements were adopted or modified by our directors and executive officers during the quarter ended December 31, 2023.

Trading Arrangement

Name and Position Action Date Rule 10b5-1* Non-Rule

10b5-1** Total Number of

Shares to be Sold Expiration

Chief Medical Officer and Orthopedic Franchise

Terminate (1)

11/13/2023 x N/A N/A

* Intended to satisfy the affirmative defense of Rule 10b5-1(c).

** Not intended to satisfy the affirmative defense of Rule 10b5-1(c).

Winston resigned on October 11, 2023 and sold 31,000 shares of common stock on November 13, 2023, effectively terminating his previously adopted Rule 10b5-1 trading arrangement.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page 86

Table of Content s

Directors, Executive Officers and Corporate Governance

3 unchanged sentences

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

Information required by this item will be included in the proxy statement for our 2023 annual stockholders’ meeting and is incorporated by reference into this report.

Securities Authorized For Issuance Under Equity Compensation Plans

The following table sets forth certain information, as of December 31, 2023, concerning shares of our common stock authorized for issuance under our equity compensation plans.

We have two equity compensation plans under which shares are currently authorized for issuance—our Amended and Restated 2011 Stock Incentive Plan (the “2011 Plan”) and our Amended and Restated 2014 Employee Stock Purchase Plan (the “2014 ESPP”).

The 2011 Plan and the 2014 ESPP were approved by stockholders.

In April 2014, our board of directors adopted (without stockholder approval), pursuant to Rule 5635(c)(4) of the Nasdaq Listing Rules, our 2014 Inducement Plan, pursuant to which awards for up to 175,000 shares of common stock could be made as a material inducement to such persons entering into employment with us (the “2014 Inducement Plan”).

In December 2023, our board of directors adopted (without stockholder approval), pursuant to Rule 5635(c)(4) of the Nasdaq Listing Rules, our Amended and Restated 2014 Inducement Plan (the “Inducement Plan”).

Pursuant to the Inducement Plan, awards for up to 817,093 shares of common stock can be made as a material inducement to such persons entering into employment with us.

Number of Securities to be Issued Upon Exercise of Outstanding Options and Rights (1) (2)

Weighted Average Exercise Price of Outstanding

Options and Rights Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) (1)

Equity compensation plans approved by stockholders (3)

7,067,248 $ 49.37 2,369,247

Equity compensation plans not approved by stockholders (3) (4)

12,500 $ 64.21 792,032

Total equity compensation plans 7,079,748 $ 49.40 3,161,279

(1) Awards issuable under our 2011 Plan, 2014 Inducement Plan and Inducement Plan include common stock, stock options, restricted stock, restricted stock units and other incentive awards.

(2) Does not include 1,364,618 unvested shares outstanding as of December 31, 2023 in the form of restricted stock units under our 2011 Plan, which do not require the payment of any consideration by the recipients.

(3) See Note 14, Stock Plans , to our consolidated financial statements included herein for further descriptions of our 2011 Plan, 2014 ESPP, 2014 Inducement Plan and Inducement Plan.

(4) On December 20, 2023, in connection with Frank D.

Lee’s appointment as Chief Executive Officer, the board of directors approved the grant of inducement awards to Mr.

Lee pursuant to the Inducement Plan.

Lee’s inducement awards included stock options to purchase an aggregate of 692,512 shares of common stock with an exercise price per share equal to $32.07, the closing price of our common stock as reported on the Nasdaq Global Select Market on January 3, 2024, and, subject to continued service with us as of each vesting date, such option will vest and become exercisable as to 25% of the option shares on January 3, 2025, and vest as to the remaining shares in successive equal quarterly installments over the subsequent three years;

and (ii) a restricted stock unit award for 99,520 shares of common stock, subject to continued service with us as of each vesting date, to vest in four equal annual installments beginning on January 2, 2025, in each case, pursuant to the terms and provisions of the Inducement Plan.

Because these awards were granted subsequent to December 31, 2023, they are not reflected in the table above.

Other information required by this item will be included in the proxy statement for our 2024 annual stockholders’ meeting and is incorporated by reference into this report.

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page 87

Table of Content s

Certain Relationships and Related Transactions, and Director Independence

2 unchanged sentences

Information required by this item will be included in the proxy statement for our 2024 annual stockholders’ meeting and is incorporated by reference into this report.

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page 82

Tab le of Contents

Exhibits, Financial Statement Schedules

1 unchanged sentence

(1) Financial Statements

Index to the Consolidated Financial Statements Page #

Consolidated Balance Sheets

12 unchanged sentences

| 2023 Form 10-K | Page 88

Tab le of Contents

Table of Content s

EXHIBIT INDEX

13 unchanged sentences

Specimen Certificate Evidencing Shares of Common Stock.*

10-Q 4.1 5/2/2019

Indenture (including form of 0.750% Convertible Senior Notes due 2025), dated July 10, 2020, between the Registrant and Computershare Corporate Trust, National Association, as trustee (formerly Wells Fargo Bank, National Association).

12 unchanged sentences

Form of Nonstatutory Stock Option Agreement (Non-Employee Directors) under the Amended and Restated 2011 Stock Incentive Plan for grants made on or after February 1, 2022.*** 10-K 10.4 2/28/2022

Form of Restricted Stock Unit Award Agreement (Employees) under the Amended and Restated 2011 Stock Incentive Plan.*** 10-Q 10.6 7/30/2015

Form of Restricted Stock Unit Award Agreement (Non-Employee Directors) under the Amended and Restated 2011 Stock Incentive Plan.*** 10-Q 10.7 7/30/2015

2014 Inducement Plan.*** 10-Q 10.1 5/1/2014

Form of Restricted Stock Unit Award Agreement (Employees) under the Amended and Restated 2011 Stock Incentive Plan for grants made prior to February 1, 2022.* ***

Form of Restricted Stock Unit Award Agreement (Non-Employee Directors) under the Amended and Restated 2011 Stock Incentive Plan for grants made prior to February 1, 2022.* ***

Amended and Restated 2014 Inducement Plan.*** 8-K 10.2 12/21/2023

Form of Nonstatutory Stock Option Agreement under the Amended and Restated 2014 Inducement Plan.* ***

Form of Restricted Stock Unit Award Agreement under the Amended and Restated 2014 Inducement Plan.* ***

Amended and Restated 2014 Employee Stock Purchase Plan.*** 8-K 10.1 6/10/2022

7 unchanged sentences

1 to Executive Employment Agreement, dated March 13, 2013, between the Registrant and David Stack.*** 8-K 99.3 3/18/2013

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page 89

Table of Content s

Incorporation By Reference From

Number Description Form Exhibit Date

Amendment No.

2 to Executive Employment Agreement, dated June 30, 2015, between the Registrant and David Stack.*** 10-Q 10.2 7/30/2015

Transition and Retirement Agreement, dated September 20, 2023, between the Registrant and David Stack.

*** 8-K 10.1 9/26/2023

Employment Agreement, dated December 20, 2023, between the Registrant and Frank D.

Lee.*** 8-K 10.1 12/21/2023

Employment Agreement, dated November 29, 2012, between the Registrant and Kristen Williams.*** 10-Q 10.2 4/30/2015

1 unchanged sentence

1 to Employment Agreement, dated March 13, 2013, between the Registrant and Kristen Williams.*** 10-Q 10.3 4/30/2015

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page 84

Tab le of Contents

Incorporation By Reference From

Number Description Form Exhibit Date

Amendment No.

2 unchanged sentences

Reinhart, III.*** 10-Q 10.1 8/4/2016

Executive Employment Agreement, dated June 19, 2019, between the Registrant and Max Reinhardt.*** 10-Q 10.1 5/7/2020

Executive Employment Agreement, dated April 24, 2017, between the Registrant and Roy Winston.*** 10-Q 10.2 5/7/2020

Form of Indemnification Agreement between the Registrant and its directors and officers.*** S-1/A 10.32 1/13/2011

Commercial Outsourcing Services Agreement entered into as of August 25, 2011 by the Registrant and Integrated Commercialization Solutions, Inc.† 10-Q 10.1 8/25/2011

First Amendment to Commercial Outsourcing Services Agreement, dated August 1, 2013, between the Registrant and Integrated Commercialization Solutions, Inc.† 10-Q 10.1 10/31/2013

Second Amendment to Commercial Outsourcing Services Agreement, dated August 25, 2014, between the Registrant and Integrated Commercialization Solutions, Inc.† 10-Q 10.1 10/30/2014

Third Amendment to Commercial Outsourcing Services Agreement, dated April 29, 2015, between the Registrant and Integrated Commercialization Solutions, Inc.† 10-Q 10.1 7/30/2015

Fourth through Eleventh Amendments to Commercial Outsourcing Services Agreement, between the Registrant and Integrated Commercialization Solutions, Inc.†† 10-Q 10.3 5/7/2020

Form of Indemnification Agreement between the Registrant and its directors and officers.* ***

Commercial Outsourcing Services Agreement entered into as of February 26, 2024 by the Registrant and Integrated Commercialization Solutions, Inc.* ††

Pacira BioSciences, Inc.

2 unchanged sentences

1 to Pacira BioSciences, Inc.

Deferred Compensation Plan.* ***

Deferred Compensation Plan.*** 10-K 10.25 2/28/2023

Pacira BioSciences, Inc.

3 unchanged sentences

Technical Transfer and Service Agreement dated April 4, 2014, by and between the Registrant and Patheon UK Limited.† 10-Q 10.3 7/31/2014

Side Letter dated June 5, 2023, to the Manufacturing and Supply Agreement by and between the Registrant and Patheon UK Limited.†† 10-Q 10.2 8/2/2023

Manufacturing and Supply Agreement dated July 31, 2015, between Flexion Therapeutics, Inc.

and Patheon UK Limited, as amended to date.†† 10-K 10.36 2/28/2022

First Amendment to Manufacturing and Supply Agreement dated May 8, 2019, between Flexion Therapeutics, Inc.

and Patheon UK Limited.* ††

Second Amendment to Manufacturing and Supply Agreement dated June 17, 2019, between Flexion Therapeutics, Inc.

and Patheon UK Limited.* ††

Third Amendment to Manufacturing and Supply Agreement dated December 1, 2023, by and between the Registrant and Patheon UK Limited.* ††

Technical Transfer and Service Agreement dated July 31, 2015, between Flexion Therapeutics, Inc.

and Patheon UK Limited, as amended to date.†† 10-K 10.37 2/28/2022

Side Letter to the Manufacturing and Supply Agreement between Flexion Therapeutics, Inc.

and Patheon UK Limited, dated as of April 8, 2020.†† 10-K 10.38 2/28/2022

Amended and Restated Consulting Agreement, dated April 3, 2012, between the Registrant and Gary Pace.*** 10-Q 10.1 5/9/2012

2 unchanged sentences

Fourth Amendment to Consulting Agreement, dated November 25, 2015, between the Registrant and Gary Pace.*** 10-K 10.57 2/25/2016

Executive Employment Agreement, dated May 29, 2017, between the Registrant and Dennis McLoughlin.*** 10-Q 10.1 5/2/2019

Contingent Value Right Agreement, dated as of November 19, 2021, by and between Pacira BioSciences, Inc.

1 unchanged sentence

8-K 10.1 11/19/2021

Credit Agreement, dated as of December 7, 2021, by and among Pacira BioSciences, Inc., the lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as administrative agent.## 8-K 10.1 12/9/2021

Manufacturing and Supply Agreement dated July 31, 2015, between Flexion Therapeutics, Inc.

and Patheon UK Limited, as amended to date.†† 10-K 10.36 2/28/22

Technical Transfer and Service Agreement dated July 31, 2015, between Flexion Therapeutics, Inc.

and Patheon UK Limited, as amended to date.†† 10-K 10.37 2/28/22

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page 90

Tab le of Contents

Table of Content s

Incorporation By Reference From

Number Description Form Exhibit Date

Side Letter to the Manufacturing and Supply Agreement between Flexion Therapeutics, Inc.

and Patheon UK Limited, dated as of April 8, 2020.†† 10-K 10.38 2/28/22

Credit Agreement, dated as of March 31, 2023, by and among Pacira BioSciences, Inc., the lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as administrative agent.## 8-K 10.1 4/3/2023

Executive Employment Agreement, dated May 4, 2020, between the Registrant and Jonathan Slonin.*** 10-Q 10.1 5/4/2022

Executive Employment Agreement, dated June 17, 2019, between the Registrant and Daryl Gaugler.*** 10-Q 10.1 5/3/2023

Executive Employment Agreement, dated December 6, 2016, between the Registrant and Anthony Molloy.*** 10-Q 10.2 5/3/2023

Subsidiaries of the Registrant.*

Consent of KPMG LLP.*

Certification of Chief Executive Officer and Chairman pursuant to Exchange Act Rule 13a-14(a).*

Certification of Chief Executive Officer pursuant to Exchange Act Rule 13a-14(a).*

Certification of Chief Financial Officer pursuant to Exchange Act Rule 13a-14(a).*

Certification of Chief Executive Officer and Chairman and Chief Financial Officer pursuant to 18 U.S.C.

Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C.

Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**

Incentive Compensation Recovery Policy.*** *

101.INS* Inline XBRL Instance Document.*

10 unchanged sentences

†† Certain portions of the exhibit have been omitted pursuant to Rule 601(b)(10) of Regulation S-K.

The omitted information is (i) not material and (ii) would likely cause competitive harm to the Company if publicly disclosed.

The omitted information (i) is not material and (ii) is the type that the Registrant treats as private or confidential.

# Certain schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K under the Securities Exchange Act of 1934, as amended.

5 unchanged sentences

| 2023 Form 10-K | Page 91

Tab le of Contents

Table of Content s

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

PACIRA BIOSCIENCES, INC.

/s/ DAVID STACK

February 29, 2024 By:

Chief Executive Officer and Chairman

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

Signature Title Date

/s/ DAVID STACK Director, Chief Executive Officer and Chairman

(Principal Executive Officer) February 28, 2023

Chief Executive Officer and Director

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated and on February 29, 2024.

Principal Executive Officer Directors

LEE /s/ MARCELO BIGAL /s/ GARY PACE

Lee Marcelo Bigal Gary Pace

Chief Executive Officer and Director

/s/ LAURA BREGE /s/ ANDREAS WICKI

Principal Financial Officer Laura Brege Andreas Wicki

/s/ CHARLES A.

REINHART, III Chief Financial Officer

(Principal Financial Officer) February 28, 2023

Reinhart, III

/s/ LAUREN RIKER Senior Vice President, Finance

(Principal Accounting Officer) February 28, 2023

/s/ LAURA BREGE Director February 28, 2023

REINHART, III /s/ ABRAHAM CEESAY /s/ MICHAEL YANG

Reinhart, III Abraham Ceesay Michael Yang

Chief Financial Officer

/s/ CHRISTOPHER J.

CHRISTIE Director February 28, 2023

Christopher J.

/s/ MARK FROIMSON Director February 28, 2023

Mark Froimson

/s/ YVONNE GREENSTREET Director February 28, 2023

Yvonne Greenstreet

/s/ MARK KRONENFELD Director February 28, 2023

CHRISTIE /s/ ALETHIA YOUNG

Principal Accounting Officer Christopher J.

Christie Alethia Young

/s/ LAUREN RIKER /s/ MARK FROIMSON /s/ PAUL HASTINGS

Lauren Riker Mark Froimson Paul Hastings

Senior Vice President, Finance (Chair of the Board)

/s/ MARK KRONENFELD

Mark Kronenfeld

/s/ GARY PACE Director February 28, 2023

/s/ ANDREAS WICKI Director February 28, 2023

Andreas Wicki

/s/ PAUL HASTINGS Lead Director February 28, 2023

Paul Hastings

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page 92

Tab le of Contents

Table of Content s

PACIRA BIOSCIENCES, INC.

15 unchanged sentences

| 2023 Form 10-K | Page F-1

Tab le of Contents

Table of Content s

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

28 unchanged sentences

| 2023 Form 10-K | Page F-2

Tab le of Contents

Table of Content s

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

Also, projections of any evaluation of effectiveness 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 the policies or procedures may deteriorate.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that:

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the consolidated 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 consolidated 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.

Evaluation of the In-Process Research & Development Intangible Impairment Charge

As discussed in Notes 5 and 9 to the consolidated financial statements, the Company performs indefinite-lived intangible asset impairment testing on an annual basis and whenever events or changes in circumstances indicate the fair value of the indefinite-lived intangible asset has declined below its carrying amount.

Fair value is estimated using a discounted cash flow model.

The Company recorded an impairment charge of $26.1 million during 2022 related to in-process research & development (IPR&D) for ZILRETTA.

We identified the evaluation of the IPR&D intangible asset impairment charge as a critical audit matter.

Evaluating the fair value measurement of this intangible asset was complex and required significant auditor judgment due to the high degree of subjectivity in evaluating certain assumptions used to estimate fair value.

In particular, the fair value measurement was sensitive to management’s forecast of revenue and the discount rate assumptions.

Changes in these assumptions could have a significant impact on the fair value of this intangible asset.

In addition, the audit effort associated with the evaluation of the Company’s discount rate involved the use of valuation professionals with specialized skills and knowledge.

The following are the primary procedures we performed to address this critical audit matter.

We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s process used to determine the fair value of its IPR&D intangible asset.

This included controls related to the development of assumptions for forecasted revenues and discount rate.

We evaluated the future revenue growth rates used by the Company to determine forecasted revenue, by comparing them to industry data that was assessed to be relevant and reliable.

We involved valuation professionals with specialized skills and knowledge, who assisted in developing an independent estimate of the discount rate using inputs from publicly available market data and comparing the results to the Company's discount rate assumption.

The communication of a critical audit matter does not alter in any way our opinion on the consolidated 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.

Fair value measurement of the contingent consideration liability associated with the acquisition of Flexion

9 unchanged sentences

We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s fair value measurement process for the contingent consideration liability related to achieving commercial and regulatory milestones.

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-3

Tab le of Contents

included controls related to the development of the assumptions for forecasted revenues, estimated probabilities and timing related to the achievement of certain milestones, volatility, and discount rates.

This included controls related to the development of the assumptions for forecasted revenues, estimated probabilities and timing related to the achievement of certain milestones, volatility, and discount rates.

We evaluated the forecasted revenues and certain commercial and regulatory milestone assumptions used in the Company’s models by comparing them to historical data, industry benchmarks and other third-party market data that were assessed to be relevant and reliable.

5 unchanged sentences

| 2023 Form 10-K | Page F-3

Tab le of Contents

Table of Content s

PACIRA BIOSCIENCES, INC.

21 unchanged sentences

Lease liabilities 8,801 9,121

Convertible senior notes, net — 350,466

Current portion of convertible senior notes, net 8,641 —

Current portion of long-term debt, net — 33,648

Income taxes payable — 429

Total current liabilities 97,383 147,774

15 unchanged sentences

Accumulated deficit ( 106,796 ) ( 148,751 )

Accumulated other comprehensive (loss) income ( 380 ) 167

Accumulated other comprehensive income (loss) 247 ( 380 )

Total stockholders’ equity 870,130 775,010

3 unchanged sentences

| 2023 Form 10-K | Page F-4

Tab le of Contents

Table of Content s

PACIRA BIOSCIENCES, INC.

12 unchanged sentences

Amortization of acquired intangible assets 57,288 57,288 13,553

Acquisition-related charges (gains), impairment and other 10,903 42,911 5,166

Contingent consideration (gains) charges, acquisition-related charges and other ( 352 ) 10,903 42,911

Total operating expenses 587,303 606,799 451,609

7 unchanged sentences

Income before income taxes 61,701 13,302 56,404

Income tax benefit (expense) 2,607 ( 14,424 ) 125,434

Income tax (expense) benefit ( 19,746 ) 2,607 ( 14,424 )

Net income $ 41,955 $ 15,909 $ 41,980

8 unchanged sentences

| 2023 Form 10-K | Page F-5

Tab le of Contents

Table of Content s

PACIRA BIOSCIENCES, INC.

4 unchanged sentences

Net income $ 41,955 $ 15,909 $ 41,980

Other comprehensive (loss) income:

Net unrealized loss on investments, net of tax ( 662 ) ( 180 ) ( 3 )

Other comprehensive income (loss):

Net unrealized gain (loss) on investments, net of tax 647 ( 662 ) ( 180 )

Foreign currency translation adjustments ( 20 ) 115 29

Total other comprehensive loss ( 547 ) ( 151 ) ( 4 )

Total other comprehensive income (loss) 627 ( 547 ) ( 151 )

Comprehensive income $ 42,582 $ 15,362 $ 41,829

2 unchanged sentences

| 2023 Form 10-K | Page F-6

Tab le of Contents

Table of Content s

PACIRA BIOSCIENCES, INC.

13 unchanged sentences

Stock-based compensation — — 42,246 — — 42,246

Retirement of equity component of 2022 convertible senior notes (Note 11) — — ( 33,089 ) — — ( 33,089 )

Equity component of 2025 convertible senior notes issued, net of deferred taxes of $ 20,450 (Note 11)

— — 64,619 — — 64,619

Other comprehensive loss (Note 13) — — — — ( 151 ) ( 151 )

1 unchanged sentence

Balance at December 31, 2021 44,734 45 942,091 ( 211,895 ) 167 730,408

Reclassification of the equity component of convertible senior notes to liabilities upon adoption of Accounting Standards Update 2020-06 (1)

— — ( 96,468 ) 47,235 — ( 49,233 )

Exercise of stock options 690 1 24,386 — — 24,387

2 unchanged sentences

Stock-based compensation — — 48,092 — — 48,092

Issuance of common stock upon conversion of 2022 convertible senior notes (Note 11) 102 — 3,040 — — 3,040

Other comprehensive loss (Note 13) — — — — ( 547 ) ( 547 )

1 unchanged sentence

Balance at December 31, 2022 45,928 46 924,095 ( 148,751 ) ( 380 ) 775,010

Reclassification of the equity component of convertible senior notes to liabilities upon adoption of Accounting Standards Update 2020-06 (Note 3) — — ( 96,468 ) 47,235 — ( 49,233 )

Exercise of stock options 63 — 1,939 — — 1,939

Vested restricted stock units 404 — ( 1 ) — — ( 1 )

Common stock withheld for employee withholding tax liabilities on vested restricted stock units ( 4 ) — ( 106 ) — — ( 106 )

Common stock issued under employee stock purchase plan 90 — 2,811 — — 2,811

Stock-based compensation — — 47,895 — — 47,895

Issuance of common stock upon conversion of 2022 convertible senior notes (Note 11) 102 — 3,040 — — 3,040

Other comprehensive loss (Note 13) — — — — ( 547 ) ( 547 )

Other comprehensive income (Note 13) — — — — 627 627

Net income — — — 41,955 — 41,955

Balance at December 31, 2023 46,481 $ 46 $ 976,633 $ ( 106,796 ) $ 247 $ 870,130

(1) Effective January 1, 2022, the Company adopted Accounting Standards Update 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) on a modified retrospective method of transition.

As a result, the Company no longer separately presents in equity an embedded conversion feature for its convertible debt.

See accompanying notes to consolidated financial statements.

1 unchanged sentence

| 2023 Form 10-K | Page F-7

Tab le of Contents

Table of Content s

PACIRA BIOSCIENCES, INC.

10 unchanged sentences

Amortization of debt discount 752 2,807 23,152

Loss (gain) on disposal of fixed assets 193 ( 10 ) 22

Loss on early extinguishment of debt 16,926 — —

3 unchanged sentences

Impairment of investment — 10,000 —

Loss (gain) on investment and other non-operating income, net 92 2,673 ( 1,618 )

Other losses 2,137 285 2,663

Changes in operating assets and liabilities:

16 unchanged sentences

Purchases of equity and debt investments ( 6,758 ) ( 13,000 ) ( 17,187 )

Net cash used in investing activities ( 225,185 ) ( 20,790 ) ( 277,607 )

Net cash provided by (used in) investing activities 77,541 ( 225,185 ) ( 20,790 )

Financing activities:

1 unchanged sentence

Proceeds from common stock issued under employee stock purchase plan 2,811 2,954 2,811

Payment of employee withholding taxes on restricted stock unit vests ( 106 ) — —

Proceeds from Term loan A facility maturing March 2028 149,550 — —

Proceeds from Term loan B facility maturing December 2026 — — 363,750

Proceeds from debt component of the 2025 convertible senior notes — — 314,708

Proceeds from equity component of the 2025 convertible senior notes — — 87,792

Repayment of 2022 convertible senior notes — ( 156,960 ) —

Retirement of equity component of the 2022 convertible senior notes — — ( 33,089 )

Repayment of 2024 convertible senior notes — ( 192,609 ) —

Repayment of Term loan B facility maturing December 2026 ( 296,875 ) ( 78,125 ) —

Repayment of Term loan A facility maturing March 2028 ( 33,437 ) — —

Debt extinguishment costs ( 5,750 ) — —

Payment of debt issuance and financing costs ( 1,163 ) ( 1,175 ) ( 4,546 )

Payment of contingent consideration — — ( 5,165 )

Net cash (used) provided by financing activities ( 401,528 ) 380,694 222,304

Net (decrease) increase in cash and cash equivalents ( 481,439 ) 485,621 21,729

Net cash (used in) provided by financing activities ( 183,031 ) ( 401,528 ) 380,694

Net increase (decrease) in cash and cash equivalents 49,159 ( 481,439 ) 485,621

Cash and cash equivalents, beginning of year 104,139 585,578 99,957

3 unchanged sentences

| 2023 Form 10-K | Page F-8

Tab le of Contents

Table of Content s

PACIRA BIOSCIENCES, INC.

17 unchanged sentences

Pacira BioSciences, Inc.

and its subsidiaries (collectively, the “Company” or “Pacira”) is the industry leader in its commitment to non-opioid pain management and providing a non-opioid option to as many patients as possible to redefine the role of opioids as rescue therapy only.

and its subsidiaries (collectively, the “Company” or “Pacira”) is the therapeutic area leader in non-opioid pain management with a stated corporate mission of providing non-opioid pain management options to as many patients as possible and redefining the role of opioids for rescue therapy only.

The Company is also developing innovative interventions to address debilitating conditions involving the sympathetic nervous system, such as cardiac electrical storm, chronic pain and spasticity.

1 unchanged sentence

EXPAREL utilizes the Company’s proprietary multivesicular liposome, or pMVL, drug delivery technology that encapsulates drugs without altering their molecular structure, and releases them over a desired period of time.

In November 2021, the Company acquired Flexion Therapeutics, Inc., or Flexion, and added ZILRETTA ® (triamcinolone acetonide extended-release injectable suspension) to its product portfolio.

In November 2021, the Company acquired Flexion Therapeutics, Inc., or Flexion (the “Flexion Acquisition”), and added ZILRETTA ® (triamcinolone acetonide extended-release injectable suspension) to its product portfolio.

ZILRETTA is the first and only extended-release, intra-articular (meaning in the joint) injection indicated for the management of osteoarthritis, or OA, knee pain.

For more information, see Note 5, Flexion Acquisition .

In April 2019, the Company added iovera° ® to its commercial offering with the acquisition of MyoScience, Inc., or MyoScience.

In April 2019, the Company added iovera° ® to its commercial offering with the acquisition of MyoScience, Inc., or MyoScience (the “MyoScience Acquisition”).

The iovera° system is a handheld cryoanalgesia device used to deliver a precise, controlled application of cold temperature to targeted nerves.

Pacira is subject to risks common to companies in similar industries and stages, including, but not limited to, competition from larger companies, reliance on revenue from three products, reliance on a limited number of wholesalers, reliance on a limited number of manufacturing sites, new technological innovations, dependence on key personnel, reliance on third-party service providers and single source suppliers, protection of proprietary technology, compliance with government regulations and risks related to cybersecurity.

Coronavirus (COVID-19) Pandemic and Global Economic Conditions

Since early 2020, the Company’s revenues and supply chain have been impacted by COVID-19 pandemic-related challenges that included the significant postponement or suspension in the scheduling of elective surgical procedures due to public health guidance and government directives.

While the degree of impact has diminished during the course of the pandemic due to the introduction of vaccines and therapeutics, as well as the lessening of elective surgery restrictions, certain pandemic-related operational and staffing challenges persist.

It remains unclear how long it will take the elective surgery market to normalize or if restrictions on elective procedures will recur due to future COVID-19 variants or otherwise.

Direct and indirect effects of the pandemic and global economic conditions have and may continue to negatively impact the Company’s business, financial condition and results of operations.

Such impacts may include the effect of prolonged periods of inflation and rising interest rates on the Company’s customers and suppliers and longer lead-times or the inability to secure a sufficient supply of materials.

The situation remains dynamic and subject to rapid and possibly material changes.

Additional negative impacts may also arise that the Company is unable to foresee.

The nature and extent of such impacts will depend on future developments, which are highly uncertain and cannot be predicted.

Pacira is subject to risks common to companies in similar industries and stages, including, but not limited to, competition from larger companies, reliance on revenue from three products, reliance on a limited number of wholesalers, reliance on a limited number of manufacturing sites, new technological innovations, dependence on key personnel, reliance on third-party service providers and sole source suppliers, protection of proprietary technology, compliance with government regulations and risks related to cybersecurity.

NOTE 2— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 unchanged sentences

The preparation of financial statements in conformity with GAAP requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, including disclosure of contingent assets and contingent liabilities, at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Estimates are used for, among other things, revenue recognition, purchase price allocation, stock-based compensation, inventory costs, impairments of equity investments, long-lived assets, goodwill and other intangible assets, liabilities and accruals, including contingent consideration, and the valuation of deferred tax assets.

Estimates are used for, among other things, revenue recognition, valuation of acquired assets and liabilities, stock-based compensation, inventory costs, impairments of equity investments, long-lived assets, goodwill and other intangible assets, liabilities and accruals, including contingent consideration, and the valuation of deferred tax assets.

The Company’s critical accounting estimates are those that are both most important to the Company’s consolidated financial condition and results of operations and require the most difficult, subjective or complex judgments on the part of management in their application, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.

Because of the uncertainty of factors surrounding the

Because of the uncertainty of factors surrounding the estimates or judgments used in the preparation of the consolidated financial statements, actual results could differ from these estimates.

Revenue From Contracts With Customers

The Company’s net product sales consist of (i) EXPAREL in the U.S., European Union, or E.U.

and the U.K.;

(ii) ZILRETTA in the U.S.;

(iii) iovera° in the U.S., Canada and Europe and (iv) sales of its bupivacaine liposome injectable suspension for veterinary use.

Royalty revenues are related to a collaborative licensing agreement from the sale of the Company’s bupivacaine liposome injectable suspension for veterinary use.

See Note 4, Revenue , for further information on the Company’s accounting policies related to revenue from contracts with customers.

Pacira BioSciences, Inc.

2 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

estimates or judgments used in the preparation of the consolidated financial statements, actual results could differ from these estimates.

Revenue From Contracts With Customers

The Company’s sources of revenue include (i) sales of EXPAREL in the U.S., European Union, or E.U.

(ii) sales of ZILRETTA in the U.S.;

(iii) sales of iovera° in the U.S., Canada and the E.U.;

(iv) sales of, and royalties on, its bupivacaine liposome injectable suspension for veterinary use and (v) license fees and milestone payments.

Royalty revenues are from the Company’s collaborative licensing agreements.

See Note 4, Revenue , for further information on the Company’s accounting policies related to revenue from contracts with customers.

Collaborative Licensing and Milestone Revenue

5 unchanged sentences

Revenue recognition from milestone payments is dependent upon the facts and circumstances surrounding the milestone payments.

Milestone payments based on a non-sales metric such as a development-based milestone (e.g.

obtaining regulatory approval) represent variable consideration and would be included in the transaction price subject to any constraints.

Milestone payments based on a non-sales metric such as a development-based milestone (e.g., obtaining regulatory approval) represent variable consideration and would be included in the transaction price subject to any constraints.

If the milestone payments relate to future development, the timing of recognition depends upon historical experience and the significance a third-party has on the outcome.

7 unchanged sentences

The Company also sells EXPAREL directly to ambulatory surgery centers and physicians.

The Company sells ZILRETTA primarily to specialty distributors and a specialty pharmacy, who then subsequently resell ZILRETTA to physicians, clinics and certain medical centers or hospitals.

The Company sells ZILRETTA primarily to specialty distributors and specialty pharmacies, who then subsequently resell ZILRETTA to physicians, clinics and certain medical centers or hospitals.

The Company also contracts directly with healthcare providers and intermediaries such as Group Purchasing Organizations, or GPOs.

9 unchanged sentences

The year ended December 31, 2022 included the first full-year of ZILRETTA net product sales.

The Company began recognizing revenue from net product sales of ZILRETTA on November 19, 2021, the date of the Flexion Acquisition (as defined herein).

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-12

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The Company began recognizing revenue from net product sales of ZILRETTA on November 19, 2021, the date of the Flexion Acquisition.

Revenue from outside the U.S.

2 unchanged sentences

and iovera° in Canada in the fourth quarter of 2021.

The Company had no revenue from outside the U.S.

during the year ended December 31, 2020.

Research and Development Expenses

3 unchanged sentences

Research and development costs are presented net of reimbursements from commercial partners.

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-11

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

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

2 unchanged sentences

Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.

The Company accrues interest and penalties, if any, on underpayment of income taxes, including those related to unrecognized tax benefits, as a component of income tax expense in its consolidated statements of operations.

The Company accrues interest and penalties on underpayments of income taxes, including those related to unrecognized tax benefits, as a component of income tax expense in its consolidated statements of operations.

Stock-Based Compensation

The Company’s stock-based compensation consists of grants of stock options and restricted stock units, or RSUs, to employees, consultants and non-employee directors, in addition to the opportunity for employees to participate in an employee stock purchase plan.

The expense associated with these programs is recognized in the Company’s consolidated statements of operations based on their fair values as they are earned under the applicable vesting terms or the length of an offering period.

The expense associated with these programs is recognized in the Company’s consolidated statements of operations based on their fair values as they are earned under their applicable vesting terms or the length of an offering period.

In calculating the estimated fair value of stock options and employee stock purchase plan share options granted, the Company uses the Black-Scholes option valuation model, or Black-Scholes model, which requires the consideration of the following variables for purposes of estimating fair value in addition to the closing price of the Company’s common stock on the date of grant:

4 unchanged sentences

The Company utilizes its historical volatility data to determine expected volatility over the expected option term.

The Company uses an expected term based on its historical data from stock option activity.

The Company uses an expected term based on its historical stock option activity data.

The risk-free interest rate is based on the implied yield on U.S.

5 unchanged sentences

All highly liquid investments with maturities of 90 days or less when purchased are considered cash equivalents.

Cash equivalents include corporate debt securities, asset-backed securities and money market funds.

Cash equivalents include money market funds.

As of December 31, 2023, the carrying value of money market funds was $ 26.1 million.

As of December 31, 2021, the carrying value of money market funds was $ 223.0 million, commercial paper was $ 19.0 million and asset-backed securities was $ 2.6 million.

As of December 31, 2022, the carrying value of money market funds was $ 42.6 million.

The carrying values approximate fair value as of December 31, 2023 and 2022.

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-13

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Short-Term and Noncurrent Available-For-Sale Investments

Short-term available-for-sale investments consist of asset-backed securities collateralized by credit card receivables, investment grade commercial paper, corporate and government bonds, and other bonds issued in the U.S.

Available-for-sale investments may consist of asset-backed securities collateralized by credit card receivables, investment grade commercial paper, corporate bonds, federal agency bonds, government bonds, and other bonds issued in the U.S.

(and denominated in the U.S.

dollar) by foreign entities, all with maturities of greater than three months, but less than one year.

Noncurrent available-for-sale investments consist of corporate and government agency bonds with maturities greater than one year.

dollar) by foreign entities.

Current available-for-sale investments are those with maturities of greater than three months, but less than one year.

Noncurrent available-for-sale investments hold maturities greater than one year.

The Company evaluates the classification of its investments at the time of purchase and re-evaluates such determination at each balance sheet date, which includes an assessment of the intent to hold the available-for-sale securities.

3 unchanged sentences

Unrealized holding gains and losses on available-for-sale securities (except for credit losses) are excluded from net income (loss) and are reported as a separate component of accumulated other comprehensive (loss) income until realized.

Realized gains and losses are included in interest income in the consolidated statements of operations and are derived using the specific identification method for determining the cost of the securities sold.

Realized gains and losses are included in interest income in the consolidated statements of operations and are derived using the specific identification method for determining the

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-12

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

cost of the securities sold.

The Company evaluates whether a credit loss exists, and in the event a credit loss does exist, the credit loss is recognized in the consolidated statements of operations based on the amount that the fair value is less than the amortized cost.

22 unchanged sentences

The Company does not have any financing leases.

The amount of ROU assets and lease liabilities to be recognized is impacted by the type of lease payments, the lease term and the

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-14

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

incremental borrowing rate.

The amount of ROU assets and lease liabilities to be recognized is impacted by the type of lease payments, the lease term and the incremental borrowing rate.

Variable lease payments are not included at commencement and are recognized in the period in which they are incurred.

2 unchanged sentences

The incremental borrowing rate is based on the rate the Company estimates it would pay on a collateralized basis over a similar term in a similar economic environment.

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-13

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

In a business combination, the acquisition method of accounting requires that the assets acquired and liabilities assumed be recorded as of the date of the acquisition at their respective fair values, with some exceptions.

10 unchanged sentences

Contingent Consideration

Subsequent to an acquisition, the Company measures contingent consideration arrangements at fair value at each reporting period, with changes in fair value recognized in the consolidated statements of operations as acquisition-related charges (gains).

Changes in contingent consideration can result from changes in the assumed achievement and timing of estimated sales, costs of goods sold and regulatory approvals.

Changes in contingent consideration can result from changes in the assumed achievement and timing of estimated sales and regulatory approvals.

In the absence of new information, changes in fair value reflect the passage of time towards achievement or expiration of the milestones, and are accreted to the period in which payments are expected to be made.

6 unchanged sentences

The Company holds investments in equity securities without a readily determinable fair value which are recognized at cost less any impairments, plus or minus any changes resulting from observable price changes in orderly transactions for a similar investment.

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-15

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Impairments of Long-Lived Assets

2 unchanged sentences

If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets.

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-14

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Per Share Data

1 unchanged sentence

Diluted net income (loss) per common share is calculated by dividing net income (loss) available (attributable) to common stockholders as adjusted for the effect of dilutive securities, if any, by the weighted average number of shares of common stock and dilutive common stock outstanding during the period.

Potential common shares include the shares of common stock issuable upon the exercise of outstanding stock options, the RSUs expected to vest, and the shares of common stock expected to be purchased under the Company’s employee stock purchase plan (using the treasury stock method), and the potential common shares issuable upon conversion of the convertible senior notes using the if-converted method.

Under the if-converted method, adjustments are made to the diluted net income (loss) per common share calculation as if the Company had converted the convertible senior notes on the first day of each period presented.

Potential common shares include the shares of common stock issuable upon the exercise of outstanding stock options, the vesting of RSUs and the purchase of shares from the Company’s employee stock purchase plan (using the treasury stock method), if applicable.

Potential common shares associated with convertible notes are treated under the if-converted method and adjustments are made to the diluted net income (loss) per common share calculation as if the Company had converted the convertible debt on the first day of each period presented.

Adjustments to the numerator are made to add back the interest expense associated with the convertible senior notes on a post-tax basis.

Adjustments to the denominator reflect the number of shares assumed to be convertible at the beginning of the period.

Foreign Currencies

9 unchanged sentences

NOTE 3— RECENT ACCOUNTING PRONOUNCEMENTS

Recently Adopted Accounting Pronouncements

In August 2020, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or 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), which limits the number of convertible debt instruments that require separate accounting to (i) those with embedded conversion features that are not clearly and closely related to the debt, that meet the definition of a derivative and that do not qualify for the scope exception from derivative accounting and (ii) convertible debt instruments issued with substantial premiums for which the premiums were recorded as paid-in capital.

In addition, the new guidance requires diluted earnings per share calculations be prepared using the if-converted method instead of the treasury stock method.

The Company elected to adopt the new guidance using a modified retrospective method of transition, which applied to transactions outstanding at January 1, 2022.

As a result, effective January 1, 2022, the Company does not separately present in equity an embedded conversion feature for its convertible debt.

Instead, the Company accounts for its convertible debt instruments wholly as debt.

In addition, effective January 1, 2022, the Company does not record interest expense on the previously recorded discount on its convertible debt.

The impact on the condensed consolidated balance sheet at January 1, 2022 increased net debt by approximately $ 64.9 million, reduced accumulated deficit by $ 47.2 million, reduced additional paid-in capital by $ 96.5 million and decreased deferred tax liabilities by $ 15.7 million.

Recently Issued Accounting Pronouncements Not Adopted as of December 31, 2023

In November 2023, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2023-07, Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures.

The ASU amendment improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses on an interim and annual basis.

The new segment disclosure requirements apply for entities with a single reportable segment.

The ASU’s amendments are effective for fiscal years beginning after December 15, 2023 and interim periods thereafter, with early adoption permitted.

The ASU will require adoption on a retrospective basis.

The Company is currently evaluating the impact of adopting ASU 2023-07 on its consolidated financial statements.

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

The ASU amendment addresses investor requests for more transparency about income tax information through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information.

The ASU’s amendments are effective for fiscal years beginning after December 15, 2024 and may be adopted on a prospective or retrospective basis.

The Company is currently evaluating the impact of adopting ASU 2023-09 on its consolidated financial statements.

Pacira BioSciences, Inc.

9 unchanged sentences

EXPAREL is delivered directly to the end-user without the wholesaler ever taking physical possession of the product.

The Company primarily sells ZILRETTA to specialty distributors and a specialty pharmacy, who then subsequently resell ZILRETTA to physicians, clinics and certain medical centers or hospitals.

The Company primarily sells ZILRETTA to specialty distributors and specialty pharmacies, who then subsequently resell ZILRETTA to physicians, clinics and certain medical centers or hospitals.

The Company also contracts directly with healthcare providers and intermediaries such as GPOs.

7 unchanged sentences

The 340B Drug Discount Program is a U.S.

federal government program created in 1992 that requires participating drug manufacturers to provide outpatient drugs to eligible health care organizations and covered entities at reduced prices.

federal government program that requires participating drug manufacturers to provide outpatient drugs to eligible health care organizations and covered entities at reduced prices.

Customers charge the Company for the difference between the product payment and the statutory selling price to the qualified entity.

4 unchanged sentences

The adequacy of these provisions is reviewed on a quarterly basis.

The following table provides a summary of activity with respect to the Company’s sales related allowances and accruals related to EXPAREL for the years ended December 31, 2022, 2021 and 2020, as well as ZILRETTA for the years ended December 31, 2022 and 2021 (in thousands):

Pacira BioSciences, Inc.

2 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The following table provides a summary of activity with respect to the Company’s sales related allowances and accruals related to EXPAREL and ZILRETTA for the years ended December 31, 2023, 2022 and 2021:

Returns Allowances Prompt Payment Discounts Service

10 unchanged sentences

Balance at December 31, 2023 $ 1,868 $ 1,308 $ 3,697 $ 5,870 $ 1,175 $ 13,918

The Company began recognizing revenue and the related allowances and accruals from net product sales of ZILRETTA on November 19, 2021, the date of the Flexion Acquisition.

Collaborative Licensing and Milestone Revenue

1 unchanged sentence

Accounts Receivable

The majority of accounts receivable arise from product sales and represent amounts due from wholesalers, hospitals, ambulatory surgery centers, specialty distributors, a specialty pharmacy and individual physicians.

Payment terms generally range from zero to 97 days from the date of the transaction, and accordingly, there is no significant financing component.

The majority of accounts receivable arise from product sales and represent amounts due from wholesalers, hospitals, ambulatory surgery centers, specialty distributors, specialty pharmacies and individual physicians.

Payment terms generally range from zero to four months from the date of the transaction, and accordingly, there is no significant financing component.

Performance Obligations

6 unchanged sentences

The Company considers control to have transferred upon delivery because the customer has legal title to the asset, physical possession of the asset has been transferred, the customer has significant risks and rewards of ownership of the asset and the Company has a present right to payment at that time.

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-17

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Disaggregated Revenue

8 unchanged sentences

Total net product sales $ 672,245 $ 664,150 $ 538,966

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-18

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The Company began recognizing revenue from net product sales of ZILRETTA on November 19, 2021, the date of the Flexion Acquisition (as defined herein).

The Company began recognizing revenue from net product sales of ZILRETTA on November 19, 2021, the date of the Flexion Acquisition.

NOTE 5— FLEXION ACQUISITION

Flexion Therapeutics, Inc.

On November 19, 2021, the Company acquired Flexion (the “Flexion Acquisition”), a biopharmaceutical company focused on the discovery, development and commercialization of novel, local therapies for the treatment of patients with musculoskeletal conditions, beginning with OA, the most common form of arthritis, pursuant to an Agreement and Plan of Merger (the “Flexion Merger Agreement”), dated as of October 11, 2021, by and among the Company, Oyster Acquisition Company Inc., a Delaware corporation and wholly owned subsidiary of the Company (“Purchaser”), and Flexion.

On November 19, 2021, the Company acquired Flexion, a biopharmaceutical company focused on the discovery, development and commercialization of novel, local therapies for the treatment of patients with musculoskeletal conditions, beginning with OA, the most common form of arthritis, pursuant to an Agreement and Plan of Merger (the “Flexion Merger Agreement”), dated as of October 11, 2021, by and among the Company, Oyster Acquisition Company Inc., a Delaware corporation and wholly owned subsidiary of the Company (“Purchaser”), and Flexion.

Following the completion of a successful tender offer for the shares of Flexion’s common stock, and pursuant to the terms of the Flexion Merger Agreement and in accordance with Section 251(h) of the General Corporation Law of the State of Delaware, Purchaser merged with and into Flexion with Flexion surviving as a wholly owned subsidiary of the Company.

13 unchanged sentences

In September 2022, based on the results of a completed phase 1 study, the Company decided to discontinue further development of PCRX-301.

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-18

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The total consideration for the Flexion Acquisition was $ 578.8 million which consisted of the following (in thousands, except per share amounts):

7 unchanged sentences

The Company accounted for the Flexion Acquisition using the acquisition method of accounting and, accordingly, has included the assets acquired, liabilities assumed and results of operations in its consolidated financial statements from the acquisition date of November 19, 2021.

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-19

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

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

The following tables set forth the allocation of the Flexion Acquisition purchase price to the estimated fair value of the net assets acquired at the acquisition date (in thousands):

Amounts Recognized at the Acquisition Date

(as previously

reported) (a)

Measurement Period Adjustments (b)

Amounts Recognized at the Acquisition Date

(as adjusted)

ASSETS ACQUIRED

Cash and cash equivalents $ 113,562 $ — $ 113,562

Short-term available-for-sale investments 11,153 — 11,153

Accounts receivable 32,838 — 32,838

Inventories 29,667 — 29,667

Prepaid expenses and other assets 4,852 — 4,852

Fixed assets 23,307 — 23,307

Deferred tax assets 58,015 ( 16,906 ) 41,109

Right-of-use assets 6,585 — 6,585

Identifiable intangible assets 480,000 — 480,000

IPR&D 61,000 — 61,000

Total assets $ 820,979 $ ( 16,906 ) $ 804,073

LIABILITIES ASSUMED

Accounts payable $ 9,794 $ — $ 9,794

Accrued expenses 22,746 1,162 23,908

Deferred revenue 10,000 — 10,000

Lease liabilities 6,585 — 6,585

Other liabilities 1,187 — 1,187

Long-term debt 201,450 — 201,450

Total liabilities 251,762 1,162 252,924

Total identifiable net assets acquired 569,217 ( 18,068 ) 551,149

Goodwill 9,628 18,068 27,696

Total consideration transferred $ 578,845 $ — $ 578,845

(a) As previously reported in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

(b) Represents the finalization of a tax study and pre-acquisition expenses that were paid by the Company in 2022, partially offset by the release of estimated reserves.

The acquired identifiable intangible assets and IPR&D assets were valued from a market participants’ perspective using a multi-period excess earnings methodology (income approach).

The identifiable finite-lived intangible asset, ZILRETTA, is a developed technology for OA knee pain with a value of $ 480.0 million and a useful life of 9.7 years.

A discount rate of 17.5 % was used in calculating the fair value of this technology.

The IPR&D asset relates to the use of ZILRETTA for the treatment of OA pain of the shoulder and was valued at $ 60.0 million.

The projected cash flows for this asset were adjusted for the probability of successful development and commercialization, and were discounted at 18.0 %.

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

This goodwill is primarily attributable to the value of combining ZILRETTA with iovera° and EXPAREL as a safe and effective non-opioid multimodal regimen for pain management, as well as the synergies of merging operations.

The acquired goodwill and intangible assets are not deductible for tax purposes.

Refer to Note 9, Goodwill and Intangible Assets , and Note 18, Acquisition-related Charges (Gains), Impairment and Other, for further information related to the Flexion Acquisition.

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-20

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Unaudited Pro Forma Summary of Operations

The following table shows the unaudited pro forma summary of operations for the years ended December 31, 2021 and 2020, as if the Flexion Acquisition had occurred on January 1, 2020.

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, 2020, and is not indicative of what such results would be expected for any future period (in thousands, except per share amounts):

Year Ended December 31,

Total revenues $ 630,942 $ 515,199

Net loss ( 67,264 ) ( 19,711 )

Pro forma basic and diluted net loss per share $ ( 1.52 ) $ ( 0.46 )

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 Flexion.

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

• Removal of the acquisition-related transaction fees and costs, including certain stock-based compensation and other compensation expenses related to the acquisition, from the years ended December 31, 2021 and 2020;

• Recognition of the income tax benefit resulting from decreasing Flexion’s existing valuation allowance on deferred tax assets for the year ended December 31, 2021;

• Removal of Flexion’s interest expense and associated deferred financing cost amortization related to the $ 85.1 million of debt not assumed;

• Adjustments to the Company’s interest income for the cash used to acquire Flexion;

• Additional cost of goods sold related to a step-up value in inventory;

• Additional amortization expense from the acquired developed technology intangible assets;

• Additional depreciation of Flexion’s fixed assets;

• Additional lease expense on Flexion’s ROU assets.

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

NOTE 6— INVENTORIES

4 unchanged sentences

Total $ 104,353 $ 96,063

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-21

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 7— FIXED ASSETS

5 unchanged sentences

Construction in progress 105,905 103,226

103,226 80,557

Total 309,233 300,992

1 unchanged sentence

Fixed assets, net $ 173,927 $ 183,512

(1) The increase of $ 22.7 million in construction in progress is related to progress in the expansion of the Company’s manufacturing facilities, including an EXPAREL capacity expansion project at the Company’s Science Center Campus in San Diego, California and a ZILRETTA capital project at Thermo Fisher Scientific Pharma Services’s site in Swindon, England.

For information on useful lives by asset category, refer to Note 2, Summary of Significant Accounting Policies .

11 unchanged sentences

The Company leases all of its facilities, including its EXPAREL and iovera° handpiece manufacturing facility at its Science Center Campus in San Diego, California.

The Company also has an embedded lease with Thermo Fisher Scientific Pharma Services for the use of their manufacturing facility in Swindon, England.

A portion of the associated monthly base fees has been allocated to the lease component based on a relative fair value basis.

The Company also has two embedded leases with Thermo Fisher Scientific Pharma Services, or Thermo Fisher, for the use of their manufacturing facility in Swindon, England for the production of EXPAREL and ZILRETTA.

A portion of the associated monthly base fees has been allocated to the lease components based on a relative fair value basis.

Since July 2022 and February 2023, the Company has been recognizing sublease income for laboratory space leased in Woburn, Massachusetts and a portion of office space leased in Burlington, Massachusetts, respectively, from leases that were assumed as part of the Flexion Acquisition.

During the third quarter of 2023, the Company partially exited its Burlington, Massachusetts office space lease that had been assumed as part of the Flexion Acquisition through a one-time termination fee of $ 0.8 million, which released its obligation of $ 1.6 million in future cash payments for the respective proportion of square footage exited.

The partial lease termination resulted in a nominal gain which was recorded within contingent consideration (gains) charges, acquisition-related charges and other in the consolidated statements of operations.

The operating lease costs for the facilities include lease and non-lease components, such as common area maintenance and other common operating expenses, along with executory costs such as insurance and real estate taxes.

14 unchanged sentences

Weighted average discount rate 7.02 % 7.05 %

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-20

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

As of December 31, 2023, maturities of the Company’s operating lease liabilities are as follows (in thousands):

Year Aggregate Minimum Payments Due

Year Aggregate Minimum

2024 $ 13,038

3 unchanged sentences

Total operating lease liabilities $ 63,607

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-23

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 9— GOODWILL AND INTANGIBLE ASSETS

The Company’s goodwill results from the acquisition of Pacira Pharmaceuticals, Inc.

from SkyePharma Holding, Inc.

(the Company’s California operating subsidiary) from SkyePharma Holding, Inc.

(now a subsidiary of Vectura Group plc), or Skyepharma, in 2007 (the “Skyepharma Acquisition”), the MyoScience Acquisition in 2019 and the Flexion Acquisition in 2021.

The change in the carrying value of the Company’s goodwill is summarized as follows (in thousands):

Carrying Value

Balance at December 31, 2020 $ 99,547

Goodwill arising from milestones achieved under the Skyepharma Acquisition 36,000

Goodwill arising from the Flexion Acquisition 9,628

Balance at December 31, 2021 145,175

Goodwill arising from measurement period adjustments associated with the Flexion Acquisition (Note 5) 18,068

Balance at December 31, 2022 $ 163,243

The Company’s goodwill balance at December 31, 2023 and December 31, 2022 was $ 163.2 million.

The Company’s goodwill balance at December 31, 2021 was $ 145.2 million.

During the year ended December 31, 2022, within one year from the Flexion Acquisition date, measurement period adjustments of $ 18.1 million were recorded to goodwill as the facts and circumstances existed prior to the acquisition date.

The adjustments primarily represent the finalization of a tax study and pre-acquisition expenses.

The acquired goodwill and intangible assets are not deductible for tax purposes.

The Skyepharma Acquisition was accounted for under Statement of Financial Accounting Standards 141, Accounting for Business Combinations , which was the effective GAAP standard at the date of acquisition.

3 unchanged sentences

and $ 32.0 million when annual net sales collected reached $ 500.0 million, which was paid in the first quarter of 2022.

These milestone payments were treated as additions to the Skyepharma Acquisition and, therefore, recorded as goodwill.

Upon the Flexion Acquisition, the Company recorded goodwill totaling $ 9.6 million.

Within one year from the Flexion Acquisition date, measurement period adjustments of $ 18.1 million were recorded to goodwill as the facts and circumstances existed prior to the acquisition date.

The adjustments primarily represent the finalization of a tax study and pre-acquisition expenses.

The acquired goodwill and intangible assets are not deductible for tax purposes.

These milestone payments were treated as additions to the Skyepharma Acquisition and, therefore, recorded as goodwill in the years achieved.

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-21

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Intangible Assets

18 unchanged sentences

Total intangible assets, net $ 624,956 $ ( 84,410 ) $ 540,546

Amortization expense on intangible assets for the years ended December 31, 2022 and 2021 was $ 57.3 million and $ 13.6 million, respectively.

The increase in expense in 2022 is the result of a full year of amortization associated with ZILRETTA for OA knee pain acquired as part of the Flexion Acquisition in November 2021.

Amortization expense on intangible assets was $ 57.3 million for both years ended December 31, 2023 and 2022.

Assuming no changes in the gross carrying amount of these intangible assets, the future estimated amortization expense on the finite-lived intangible assets will be $ 57.3 million from 2024 to 2030, $ 37.4 million in 2031, $ 7.9 million in 2032 and $ 2.2 million in 2033.

The Company reviews its indefinite-lived intangible assets for impairment annually and whenever an event or change in circumstances arises that indicates the carrying amount of an indefinite-lived intangible asset is at risk of not being recoverable.

During the year ended December 31, 2023, the Company conducted the annual impairment assessment for its acquired IPR&D and concluded there was no impairment as of that date.

During the year ended December 31, 2022, the annual impairment assessment of ZILRETTA acquired IPR&D for the treatment of OA pain of the shoulder was conducted through a recoverability test at December 31, 2022 by comparing the $ 60.0 million carrying value of the asset against the fair value through a discounted cash flow model of $ 33.9 million based on new facts and circumstances.

The change in fair value was primarily driven by later timelines for the completion of clinical trials impacting revenue forecasts, among other factors.

An impairment of $ 26.1 million was recognized within contingent consideration (gains) charges, acquisition-related charges and other in the consolidated statements of operations for the year ended December 31, 2022 based on the amount its previous carrying value exceeded its updated fair value.

Pacira BioSciences, Inc.

2 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Assuming no changes in the gross carrying amount of these intangible assets, the future estimated amortization expense on the finite-lived intangible assets will be $ 57.3 million from 2023 to 2030, $ 37.4 million in 2031, $ 7.9 million in 2032 and $ 2.2 million in 2033.

During the year ended December 31, 2022, the annual impairment assessment for ZILRETTA acquired IPR&D for the treatment of OA pain of the shoulder was conducted through a recoverability test at December 31, 2022 by comparing the $ 60.0 million carrying value of the asset against the fair value through a discounted cash flow model of $ 33.9 million based on new facts and circumstances.

The change in fair value was primarily driven by later timelines for the completion of clinical trials impacting revenue forecasts, among other factors.

An impairment of $ 26.1 million was recognized within acquisition-related charges (gains), impairment and other in the consolidated statements of operations for the year ended December 31, 2022 based on the amount its previous carrying value exceeded its updated fair value.

NOTE 10— ACCRUED EXPENSES

4 unchanged sentences

Compensation and benefits 21,682 26,198

26,198 45,491

Termination fee (1)

3 unchanged sentences

Total $ 64,243 $ 89,785

(1) At December 31, 2021, compensation and benefits included $ 18.4 million of accrued severance associated with the Flexion Acquisition.

(1) See Note 20, Commitments and Contingencies , for more information.

(3) At December 31, 2021, accrued royalties included a $ 32.0 million milestone payment to Skyepharma that was met in the fourth quarter of 2021 for achieving annual net sales collected of $ 500.0 million on the Company’s DepoBupivacaine products, including EXPAREL.

This milestone was paid in the first quarter of 2022.

See Note 9, Goodwill and Intangible Assets , for more information .

NOTE 11— DEBT

The carrying value of the Company’s outstanding debt is summarized as follows (amounts in thousands):

Term loan A facility maturing March 2028 $ 115,202 $ —

Term loan B facility maturing December 2026 — 284,704

2 unchanged sentences

3.375 % Convertible senior notes due May 2024

8,641 201,249

2.375 % Convertible senior notes due April 2022 (1)

Total $ 522,437 $ 689,471

(1) The 2022 Notes (as defined below) matured on April 1, 2022.

2028 Term Loan A Facility

On March 31, 2023, the Company entered into a credit agreement (the “TLA Credit Agreement”) with JPMorgan Chase Bank, N.A., as administrative agent, and certain lenders, to refinance the indebtedness outstanding under the Company’s TLB Credit Agreement (as defined and discussed below).

The term loan issued under the TLA Credit Agreement (the “TLA Term Loan”) was issued at a 0.30 % discount and provides for a single-advance term loan A facility in the principal amount of $ 150.0 million, which is secured by substantially all of the Company’s and any subsidiary guarantor’s assets.

Subject to certain conditions, the Company may, at any time, on one or more occasion, add one or more new classes of term facilities and/or increase the principal amount of the loans of any existing class by requesting one or more incremental term facilities.

The net proceeds of the TLA Term Loan were approximately $ 149.6 million after deducting an original issue discount of $ 0.4 million.

The total debt composition of the TLA Term Loan is as follows (in thousands):

Term loan A facility maturing March 2028 $ 116,563

Deferred financing costs ( 988 )

Discount on debt ( 373 )

Total debt, net of debt discount and deferred financing costs $ 115,202

The TLA Term Loan matures on March 31, 2028 and the TLA Credit Agreement requires quarterly repayments of principal in the amount of $ 2.8 million which commenced on June 30, 2023, increasing to $ 3.8 million commencing March 31, 2025, with a remaining balloon payment of approximately $ 85.3 million due at maturity.

Due to voluntary principal

Pacira BioSciences, Inc.

2 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

prepayments of $ 30.6 million made during the year ended December 31, 2023, the Company is not required to make further principal payments until December 2025, although the Company retains the option to do so.

The TLA Credit Agreement requires the Company to, among other things, maintain (i) a Senior Secured Net Leverage Ratio (as defined in the TLA Credit Agreement), determined as of the last day of each fiscal quarter, of no greater than 3.00 to 1.00 and (ii) a Fixed Charge Coverage Ratio (as defined in the TLA Credit Agreement), determined as of the last day of each fiscal quarter, of no less than 1.50 to 1.00.

The TLA Credit Agreement requires the Company to maintain an unrestricted cash and cash equivalents balance of at least $ 500.0 million less any prepayments of the 2025 Notes (as defined below) at any time from 91 days prior to the maturity date through the earlier of (i) the latest maturity date of the 2025 Notes and (ii) the date on which there is no outstanding principal amount of the 2025 Notes.

The TLA Credit Agreement also contains customary affirmative and negative covenants, financial covenants, representations and warranties, events of default and other provisions.

As of December 31, 2023, the Company was in compliance with all financial covenants under the TLA Credit Agreement.

The Company may elect to borrow either (i) alternate base rate borrowings or (ii) term benchmark borrowings or daily simple SOFR (as defined in the TLA Credit Agreement) borrowings.

Each term loan borrowing that is an alternate base rate borrowing bears interest at a rate per annum equal to (i) the Alternate Base Rate (as defined in the TLA Credit Agreement), plus (ii) a spread based on the Company’s Senior Secured Net Leverage Ratio ranging from 2.00 % to 2.75 %.

Each term loan borrowing that is a term benchmark borrowing or daily simple SOFR borrowing bears interest at a rate per annum equal to (i) the Adjusted Term SOFR Rate or Adjusted Daily Simple SOFR (as each is defined in the TLA Credit Agreement), plus (ii) a spread based on the Company’s Senior Secured Net Leverage Ratio ranging from 3.00 % to 3.75 %.

During the year ended December 31, 2023, the Company made a scheduled principal payment of $ 2.8 million as well as $ 30.6 million of voluntary principal prepayments.

As of December 31, 2023, borrowings under the TLA Term Loan consisted entirely of term benchmark borrowings at a rate of 8.46 %.

2026 Term Loan B Facility

In December 2021, the Company entered into a term loan credit agreement (the “Credit Agreement”) with JP Morgan Chase Bank, N.A., as administrative agent and the initial lender.

The term loan issued under the Credit Agreement (the “Term Loan”) was issued at a 3 % discount and allows for a single-advance term loan B facility in the principal amount of $ 375.0 million and is secured by substantially all of the Company’s and each subsidiary guarantor’s assets.

The net proceeds of the Term Loan were approximately $ 363.8 million after deducting an original issue discount of $ 11.2 million.

The total debt composition of the Term Loan is as follows (in thousands):

Term Loan maturing December 2026 $ 296,875 $ 375,000

In December 2021, the Company entered into a term loan credit agreement (the “TLB Credit Agreement”) with JPMorgan Chase Bank, N.A., as administrative agent and the initial lender.

The term loan issued under the TLB Credit Agreement (the “TLB Term Loan”) was issued at a 3.00 % discount and allowed for a single-advance term loan B facility in the principal amount of $ 375.0 million, which was secured by substantially all of the Company’s and each subsidiary guarantor’s assets.

The net proceeds of the TLB Term Loan were approximately $ 363.8 million after deducting an original issue discount of $ 11.2 million.

On March 31, 2023, the Company used the $ 149.6 million of net borrowings under the TLA Credit Agreement and cash on hand to repay the indebtedness outstanding under the TLB Credit Agreement and concurrently terminated the TLB Credit Agreement.

The Company incurred a prepayment fee of 2.00 % of the outstanding principal balance of the TLB Term Loan in connection with the termination.

The total debt composition of the TLB Term Loan was as follows (in thousands):

Term loan B facility maturing December 2026 $ — $ 296,875

Deferred financing costs — ( 3,919 )

1 unchanged sentence

Total debt, net of debt discount and deferred financing costs $ — $ 284,704

The Term Loan matures on December 7, 2026 and requires quarterly repayments of principal in the amount of $ 9.4 million commencing June 30, 2022, and increasing to $ 14.1 million commencing December 31, 2025, with a remaining balloon payment of approximately $ 137.5 million due at maturity.

The Company is required to make mandatory prepayments of principal from (i) the Company’s excess cash flow (as defined in the Credit Agreement) existing in any fiscal year and if the Senior Secured Leverage Ratio (as defined in the Credit Agreement) for such fiscal year exceeds certain predetermined limits (ii) net proceeds (as defined in the Credit Agreement) of non-ordinary course assets sales and casualty events and (iii) debt issuance proceeds (other than permitted debt under the Credit Agreement).

Prepayment penalties for the Term Loan were 2 % in the first loan year plus an interest make-whole payment, 2 % in the second loan year, 1 % in the third loan year and nothing thereafter.

Prepayment penalties generally do not apply to mandatory prepayment obligations under the Credit Agreement, such as prepayments due in connection with excess cash flow.

During the year ended December 31, 2022, the Company made scheduled principal payments of $ 28.1 million in the aggregate.

In addition, during the year ended December 31, 2022, the Company made an additional prepayment of $ 51.0 million, which included a $ 50.0 million reduction in principal and a $ 1.0 million prepayment penalty recorded as part of its deferred financing costs to be included in interest expense prospectively.

The Term Loan requires the Company to, among other things, maintain (i) a first lien net leverage ratio, determined as of the last day of any fiscal quarter, of no greater than 1.75 to 1.00 and (ii) liquidity, at any time, of at least $ 150.0 million.

The Term Loan also contains customary affirmative and negative covenants, financial covenants, representations and warranties, events of default and other provisions.

As of December 31, 2022, the Company was in compliance with all financial covenants under the Credit Agreement.

The Company may elect to borrow either term benchmark borrowings or alternate base rate borrowings.

Term benchmark borrowings bear interest at a variable rate per annum equal to the Adjusted Term SOFR Rate (as defined in the Credit Agreement) (subject to a 75 basis points floor) plus an applicable margin of 700 basis points.

Alternate base rate borrowings bear interest at a variable rate per annum determined using a base rate (subject to a 175 basis points floor) equal to the greatest of (i) the Prime Rate (as defined in the Credit Agreement) in effect on such day, (ii) the NYFRB Rate (as defined in the Credit Agreement) plus 50 basis points or (iii) the Adjusted Term SOFR Rate (as defined in the Credit Agreement) plus 100 basis points, subject to certain exceptions, plus an applicable margin of 600 basis points.

As of December 31, 2022, borrowings under the Term Loan consisted entirely of term benchmark borrowings at a rate of 10.78 %.

During the year ended December 31, 2023, the Company made a scheduled principal payment of $ 9.4 million and repaid the outstanding $ 287.5 million principal on the TLB Term Loan, which resulted in a $ 16.9 million loss on early extinguishment of debt.

Convertible Senior Notes Due 2025

In July 2020, the Company completed a private placement of $ 402.5 million in aggregate principal amount of its 0.750 % convertible senior notes due 2025, or 2025 Notes, and entered into an indenture with Computershare Corporate Trust, N.A.

In July 2020, the Company completed a private placement of $ 402.5 million in aggregate principal amount of 0.750 % convertible senior notes due 2025, or 2025 Notes, and entered into an indenture with Computershare Corporate Trust, N.A.

(formerly Wells Fargo Bank, N.A.), or 2025 Indenture, with respect to the 2025 Notes.

9 unchanged sentences

Deferred financing costs ( 3,906 ) ( 6,374 )

Discount on debt — ( 64,718 )

Total debt, net of debt discount and deferred financing costs $ 398,594 $ 396,126

18 unchanged sentences

In the event that all of the 2025 Notes are converted, the Company would be required to repay the $ 402.5 million in principal value and any conversion premium in any combination of cash and shares of its common stock (at the Company’s option).

Prior to August 1, 2023, the Company may not redeem the 2025 Notes.

On or after August 1, 2023 (but, in the case of a redemption of less than all of the outstanding 2025 Notes, no later than the 40 th scheduled trading day immediately before the maturity date), the Company may redeem for cash all or part of the 2025 Notes if the last reported sale price (as defined in the 2025 Indenture) of the Company’s common stock has been at least 130 % of the conversion price then in effect for (i) each of at least 20 trading days (whether or not consecutive) during any 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related notice of redemption and (ii) the trading day immediately before the date the Company sends such notice.

The redemption price will equal the sum of (i) 100 % of the principal amount of the 2025 Notes being redeemed, plus (ii) accrued and unpaid interest, including additional interest, if any, to, but excluding, the

Beginning on August 1, 2023 (but, in the case of a redemption of less than all of the outstanding 2025 Notes, no later than the 40 th scheduled trading day immediately before the maturity date), the Company may redeem for cash all or part of the 2025 Notes if the last reported sale price (as defined in the 2025 Indenture) of the Company’s common stock has been at least 130 % of the conversion price then in effect for (i) each of at least 20 trading days (whether or not consecutive) during any 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related notice of redemption and (ii) the trading day immediately before the date the Company sends such notice.

In addition, calling the 2025 Notes for redemption will constitute a “make-whole fundamental change” (as defined in the 2025 Indenture) and will, in certain circumstances,

Pacira BioSciences, Inc.

2 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

redemption date.

In addition, calling the 2025 Notes for redemption will constitute a “make-whole fundamental change” (as defined in the 2025 Indenture) and will, in certain circumstances, increase the conversion rate applicable to the conversion of such notes if it is converted in connection with the redemption.

increase the conversion rate applicable to the conversion of such notes if it is converted in connection with the redemption.

No sinking fund is provided for the 2025 Notes.

3 unchanged sentences

The 2025 Notes are also effectively junior in right of payment to any of the Company’s secured indebtedness to the extent of the value of the assets securing such indebtedness, and are structurally subordinated to any debt or other liabilities (including trade payables) of the Company’s subsidiaries.

While the 2025 Notes are currently classified on the Company’s consolidated balance sheet at December 31, 2022 as long-term debt, the future convertibility and resulting balance sheet classification of this liability is monitored at each quarterly reporting date and is analyzed dependent upon market prices of the Company’s common stock during the prescribed measurement periods.

While the 2025 Notes are classified on the Company’s consolidated balance sheet at December 31, 2023 as long-term debt, the future convertibility and resulting balance sheet classification of this liability is monitored at each quarterly reporting date and is analyzed dependent upon market prices of the Company’s common stock during the prescribed measurement periods.

In the event that the holders of the 2025 Notes have the election to convert the 2025 Notes at any time during the prescribed measurement period, the 2025 Notes would then be considered a current obligation and classified as such.

6 unchanged sentences

Effective January 1, 2022, the 2025 Notes debt discount carrying value of $ 64.7 million was eliminated and there was a $ 1.7 million increase in deferred financing costs offset by additional paid-in capital, accumulated deficit and deferred tax assets.

For additional information regarding the adoption of ASU 2020-06, see Note 3 , Summary of Significant Accounting Policies .

The 2025 Notes do not contain any financial or operating covenants or any restrictions on the payment of dividends, the issuance of other indebtedness or the issuance or repurchase of securities by the Company.

22 unchanged sentences

In March 2017, the Company completed a private placement of $ 345.0 million in aggregate principal amount of 2.375 % convertible senior notes due 2022, or 2022 Notes, and entered into an indenture with respect to the 2022 Notes.

The 2022 Notes accrued interest at a fixed rate of 2.375 % per year, payable semiannually in arrears on April 1 st and October 1 st of each year.

In July 2020, the Company used part of the net proceeds from the issuance of the 2025 Notes to repurchase $ 185.0 million aggregate principal amount of the 2022 Notes in privately negotiated transactions for an aggregate of $ 211.1 million in cash (including accrued interest).

The partial repurchase of the 2022 Notes resulted in an $ 8.1 million loss on early extinguishment of debt during the year ended December 31, 2020.

The total debt composition of the 2022 Notes is as follows (in thousands):

2.375 % convertible senior notes due April 2022

$ — $ 160,000

Deferred financing costs — ( 223 )

Discount on debt — ( 1,920 )

Total debt, net of debt discount and deferred financing costs $ — $ 157,857

On April 1, 2022, the 2022 Notes matured and the Company settled the remaining outstanding principal balance of $ 160.0 million and a conversion premium of $ 4.8 million through a cash payment of $ 156.9 million and the issuance of 101,521 shares of the Company’s common stock, which increased additional paid-in capital by $ 3.0 million.

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-29

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Interest Expense

12 unchanged sentences

The deferred financing costs previously allocated to the conversion features have been re-allocated to the outstanding debt.

For additional information regarding the adoption of ASU 2020-06, see Note 3 , Summary of Significant Accounting Policies .

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-27

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 12— FINANCIAL INSTRUMENTS

9 unchanged sentences

The carrying value of financial instruments including cash and cash equivalents, accounts receivable and accounts payable approximate their respective fair values due to the short-term nature of these items.

The fair value of the Company’s convertible senior notes are calculated utilizing market quotations from an over-the-counter trading market for these notes (Level 2).

The fair value of the Company’s convertible senior notes and its term loan are calculated utilizing market quotations from an over-the-counter trading market for these notes (Level 2).

The fair value of the Company’s acquisition-related contingent consideration is reported at fair value on a recurring basis (Level 3).

The carrying amounts of convertible notes receivable without readily determinable fair values have not been adjusted for either an impairment or upward or downward adjustments based on observable transactions, whereas an equity investment was fully impaired during the year ended December 31, 2022.

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-30

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The carrying amounts of equity investments and convertible notes receivable without readily determinable fair values have not been adjusted for either an impairment or upward or downward adjustments based on observable transactions, whereas an equity investment was fully impaired during the year ended December 31, 2022.

At December 31, 2023, the carrying values and fair values of the Company’s financial assets and liabilities were as follows (in thousands):

8 unchanged sentences

Financial Liabilities Measured at Amortized Cost:

Term loan B facility due December 2026 $ 284,704 $ — $ 292,422 $ —

Term loan A facility due March 2028 $ 115,202 $ — $ 115,980 $ —

0.750 % convertible senior notes due 2025 (1)

2 unchanged sentences

$ 8,641 $ — $ 8,641 $ —

(1) The closing price of the Company’s common stock as reported on the Nasdaq Global Select Market was $ 38.61 per share at December 31, 2022 compared to a conversion price of $ 71.78 per share.

(1) The closing price of the Company’s common stock as reported on the Nasdaq Global Select Market was $ 33.74 per share on December 29, 2023—the last trading day of 2023—compared to a conversion price of $ 71.78 per share.

At December 31, 2023, as the conversion price was above the stock price, the requirements for conversion have not been met.

The maximum conversion premium that could have been due on the 2025 Notes at December 31, 2022 is approximately 5.6 million shares of the Company’s common stock, which assumes no increase in the conversion rate for certain events.

(2) Relates to the Flexion 2024 Notes.

For more information, See Note 11, Debt .

The maximum conversion premium that could have been due on the 2025 Notes is 5.6 million shares of the Company’s common stock, which assumes no increase in the conversion rate for certain events.

Certain assets and liabilities are measured at fair value on a non-recurring basis, including assets and liabilities acquired in a business combination and long-lived assets, which would be recognized at fair value if deemed impaired or if reclassified as assets held for sale.

The fair value in these instances would be determined using Level 3 inputs.

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-28

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis

6 unchanged sentences

Purchases 11,750 1,250 13,000

Divestiture of investment ( 11,642 ) — ( 11,642 )

Impairment ( 10,000 ) — ( 10,000 )

Foreign currency adjustments — ( 67 ) ( 67 )

2 unchanged sentences

Purchases — 6,758 6,758

Impairment ( 10,000 ) — ( 10,000 )

Foreign currency adjustments — 61 61

2 unchanged sentences

During the year ended December 31, 2022, an impairment of an equity investment of $ 10.0 million was recorded in other, net in the consolidated statements of operations.

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-31

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

During the year ended December 31, 2021, the Company sold an equity investment for net cash proceeds of $ 9.1 million and recognized a realized loss of $ 2.6 million, which was recorded in other, net in the consolidated statements of operations.

The fair value of the divested equity investment was based on a Level 1 input.

In February 2023, the Company invested $ 4.0 million in a convertible note receivable.

Acquisition-Related Contingent Consideration

The Company has recognized contingent consideration related to the Flexion Acquisition and the MyoScience Acquisition in the amount of $ 24.7 million and $ 28.1 million as of December 31, 2023 and 2022, respectively.

Refer to Note 5, Flexion Acquisition and Note 18, Acquisition-related Charges (Gains), Impairment and Other, for more information.

Refer to Note 5, Flexion Acquisition and Note 18, Contingent Consideration (Gains) Charges, Acquisition-related Charges and Other, for more information.

The Company’s contingent consideration obligations are recorded at their estimated fair values and are revalued each reporting period if and until the related contingencies are resolved.

5 unchanged sentences

The Company’s obligation to make milestone payments is limited to those milestones achieved through December 31, 2030, and are to be paid within 60 days of the end of the fiscal quarter of achievement.

As part of the purchase price consideration related to the Flexion Acquisition, the Company recorded contingent consideration of $ 45.2 million, which represented the Company’s potential achievement of meeting the regulatory and commercial milestones.

From the date of the Flexion Acquisition through December 31, 2021, the Company recorded an additional $ 1.2 million liability.

For the year ended December 31, 2022 , the Company recorded a gain of $ 18.3 million primarily due to adjustments to near-term forecasts for the earnout period of the Flexion contingent consideration, which were recorded as acquisition-related gains in the consolidated statements of operations.

At December 31, 2022, the weighted average discount rate was 15.0 %.

The probability of payment for the achievement of the remaining regulatory milestone by the expiration date was reduced to 12.5 % at December 31, 2022 from 15 % at December 31, 2021.

The reduction in the probability of payment is due to the likelihood of achievement prior to the expiration date being reduced to 50 % from 100 % due to revised timing in conducting clinical trial studies, whereas the probability of success in regulatory approval has improved to 25 % from 15 %.

As of December 31, 2022 and 2021, the contingent consideration liability related to the Flexion Acquisition was recognized in the amount of $ 28.1 million and $ 46.4 million, respectively.

In April 2019, the Company completed the MyoScience Acquisition pursuant to the terms of an Agreement and Plan of Merger, which provided for contingent milestone payments of up to an aggregate of $ 100.0 million upon the achievement of certain regulatory and commercial milestones.

The Company’s obligation to make milestone payments is limited to those milestones achieved through December 31, 2023, and are to be paid within 60 days of the end of the fiscal quarter of achievement.

As of December 31, 2022, the maximum potential remaining milestone payments to be paid are $ 43.0 million.

For the year ended December 31, 2022, the Company recognized a contingent consideration gain of $ 11.2 million due to the reduced probability of meeting the MyoScience contingent consideration milestones by December 31, 2023, the expiration date for achieving the remaining milestones.

For the years ended December 31, 2021 and 2020, the Company recognized an acquisition-related gain of $ 2.2 million and an acquisition-related charge of $ 5.2 million, respectively, as a result of revisions to the probabilities of regulatory milestones being met and future projections, which have been included in acquisition-related charges (gains) in the consolidated statements of operations.

At December 31, 2022, the probability of success for the regulatory milestone that has not yet been met was reduced to zero .

As of December 31, 2022 and 2021, the fair value associated with the contingent consideration liability related to the MyoScience Acquisition has been assessed as zero and $ 11.2 million, respectively.

For the year ended December 31, 2023, the Company recorded gai ns of $ 3.4 million due to a decrease in the fair value of the Flexion contingent consideration.

The decrease was primarily due to adjustments in the assumption for the long-term forecasts which reduced the probability of meeting the sales-based contingent consideration milestones by December 31, 2030, the expiration date for achieving the milestones.

The impact of this assumption on the fair value was partially offset by a decrease to the assumed discount rate based on a significant improvement in the Company’s incremental borrowing rate resulting from the TLA Credit Agreement entered into in March 2023.

From the date of the Flexion Acquisition through December 31, 2021, the Company recorded charges of $ 1.2 million.

These gains and charges were recorded as contingent consideration (gains) charges, acquisition-related charges and other in the consolidated statements of operations.

Pacira BioSciences, Inc.

2 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

December 31, 2023, the weighted average discount rate was 8.8 % and the probability of payment for the achievement of the remaining regulatory milestone by the expiration date was 12.5 %.

As of December 31, 2023 and 2022, the contingent consideration liability related to the Flexion Acquisition was recognized in the amount of $ 24.7 million and $ 28.1 million, respectively.

The Company’s obligation to make milestone payments was limited to milestones achieved through December 31, 2023.

As of December 31, 2023 and 2022, the contingent consideration liability related to the MyoScience Acquisition has been assessed as zero .

For the year ended December 31, 2021, the Company recognized a gain of $ 2.2 million.

These gains were recorded as contingent consideration (gains) charges, acquisition-related charges and other in the consolidated statements of operations .

The following table includes the key assumptions used in the valuation of the Company’s contingent consideration:

Assumption Flexion Ranges Utilized as of

Assumption Flexion Ranges

Utilized as of

December 31, 2023

5 unchanged sentences

Balance at December 31, 2021 $ 57,598

Contingent consideration related to the Flexion Acquisition 45,241

Fair value adjustments and accretion ( 29,476 )

Payments made or offset against amounts due ( 15,000 )

Balance at December 31, 2022 28,122

3 unchanged sentences

Short-term investments consist of asset-backed securities collateralized by credit card receivables, investment grade commercial paper and corporate, federal agency and government bonds with maturities greater than three months, but less than one year.

Noncurrent investments consist of federal agency bonds with maturities greater than one year but less than three years.

Noncurrent investments consist of U.S.

government and federal agency bonds and asset-backed securities with maturities greater than one year but less than three years.

Net unrealized gains and losses (excluding credit losses, if any) from the Company’s short-term and noncurrent investments are reported in other comprehensive (loss) income.

2 unchanged sentences

Treasury bill rate as an observable input.

The fair value of the asset-backed securities and corporate bonds is principally measured or corroborated by trade data for identical issues in which related trading activity is not sufficiently frequent to be considered a Level 1 input or that of comparable securities.

The fair value of the federal agency bonds, asset-backed securities and corporate bonds is principally measured or corroborated by trade data for identical issues in which related trading activity is not sufficiently frequent to be considered a Level 1 input or that of comparable securities.

The fair value of U.S.

government bonds is based on level 1 trading activity.

At the time of purchase, all short-term and noncurrent investments had an “A” or better rating by Standard & Poor’s.

6 unchanged sentences

Losses Fair Value

(Level 1) Fair Value

Asset-backed securities $ 9,539 $ 1 $ — $ — $ 9,540

3 unchanged sentences

Subtotal 125,228 104 ( 49 ) 14,879 110,404

federal agency bonds 22,783 2 ( 66 ) 22,719

government bonds 14,499 — ( 9 ) 14,490

Asset-backed securities 2,403 7 — — 2,410

Subtotal 2,403 7 — — 2,410

2 unchanged sentences

Losses Fair Value

(Level 1) Fair Value

Asset-backed securities $ 6,836 $ — $ ( 3 ) $ — $ 6,833

Commercial paper 134,423 23 ( 386 ) — 134,060

Corporate bonds 9,936 102 — 10,038

federal agency bonds 41,971 — ( 337 ) — 41,634

government bonds 2,003 — ( 18 ) — 1,985

Subtotal 185,233 23 ( 744 ) — 184,512

federal agency bonds 22,783 2 ( 66 ) — 22,719

government bonds 14,499 — ( 9 ) — 14,490

Subtotal 37,282 2 ( 75 ) — 37,209

Total $ 222,515 $ 25 $ ( 819 ) $ — $ 221,721

6 unchanged sentences

As of December 31, 2023, three wholesalers each accounted for over 10% of the Company’s accounts receivable at 37 %, 19 % and 16 %.

As of December 31, 2021, four wholesalers each accounted for over 10% of the Company’s accounts receivable at 30 %, 20 %, 17 % and 11 %.

As of December 31, 2022, three wholesalers each accounted for over 10% of the Company’s accounts receivable at 34 %, 19 % and 18 %.

For additional information regarding the Company’s wholesalers, see Note 2 , Summary of Significant Accounting Policies .

12 unchanged sentences

No preferred stock was issued or outstanding at either December 31, 2023 or 2022.

Accumulated Other Comprehensive (Loss) Income

The following table illustrates the changes in the balances of the Company’s accumulated other comprehensive (loss) income for the periods presented (in thousands):

Accumulated Other Comprehensive Income (Loss)

The following table illustrates the changes in the balances of the Company’s accumulated other comprehensive income (loss) for the periods presented (in thousands):

Net Unrealized Gains

(Losses) From Available-For-Sale Investments Unrealized Foreign Currency Translation Accumulated Other Comprehensive (Loss) Income

Balance at December 31, 2019 $ 322 $ — $ 322

Net unrealized loss on investments ( 3 ) — ( 3 )

Foreign currency translation adjustments — ( 1 ) ( 1 )

(Losses) From Available-For-Sale Investments Unrealized Foreign Currency Translation Accumulated Other Comprehensive Income (Loss)

Balance at December 31, 2020 $ 319 $ ( 1 ) $ 318

7 unchanged sentences

Balance at December 31, 2022 ( 523 ) 143 ( 380 )

(1) Net of a $ 0.2 million and $ 0.1 million tax benefit for the years ended December 31, 2022 and 2021, respectively.

Net unrealized gain on investments, net of tax (1)

Foreign currency translation adjustments — ( 20 ) ( 20 )

Balance at December 31, 2023 $ 124 $ 123 $ 247

(1) Net of a $( 0.2 ) million, $ 0.2 million and $ 0.1 million tax (expense) benefit for the years ended December 31, 2023, 2022 and 2021, respectively.

NOTE 14— STOCK PLANS

Stock Incentive Plans

The Company’s amended and restated 2011 stock incentive plan, or 2011 Plan, was originally adopted by its board of directors and approved by its stockholders in June 2011 and was amended in June 2014, June 2016, June 2019 and June 2021.

The June 2021 amendment and approval by the Company’s stockholders increased the number of shares of common stock authorized for issuance as equity awards under the plan by 1,500,000 shares.

The 2011 Plan allows the granting of incentive stock options, non-statutory stock options, restricted stock awards and other stock-based awards.

In April 2014, the Company’s board of directors also adopted the 2014 Inducement Plan.

The Company’s Amended and Restated 2011 Stock Incentive Plan, or 2011 Plan, was originally adopted by its board of directors and approved by its stockholders in June 2011 and was amended and restated in June 2014, June 2016, June 2019, June 2021 and June 2023.

The June 2023 amendment and restatement and approval by the Company’s stockholders increased the number of shares of common stock authorized for issuance as equity awards under the 2011 Plan by 3,300,000 shares, which allows the granting of incentive stock options, non-statutory stock options, restricted stock units and other stock-based awards.

In April 2014, the Company’s board of directors approved and adopted the Company’s 2014 Inducement Plan (the “2014 Inducement Plan”), pursuant to which awards could be made to new employees under the 2014 Inducement Plan for up to 175,000 shares of the Company’s common stock as a material inducement to such persons entering into employment with the Company.

On December 20, 2023, the board of directors, upon recommendation of the compensation committee of the board of directors, adopted the Pacira BioSciences, Inc.

Amended and Restated 2014 Inducement Plan (as amended and restated, the “Inducement Plan”) such that, among other things, an additional 642,093 shares of the Company’s common stock and 817,093 shares of the Company’s common stock in total, were reserved for issuance under the Inducement Plan, and the term of the Inducement Plan was extended such that it will now expire on December 20, 2033.

The Inducement Plan allows the granting of incentive stock options, non-statutory stock options, restricted stock awards and other stock-based awards.

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-32

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

In addition, on December 20, 2023, the board of directors, upon recommendation of the compensation committee, approved the Inducement Award (as defined below) pursuant to the terms and provisions of the Inducement Plan.

The “Inducement Award” means the grant to Frank D.

Lee, in connection with his appointment as Chief Executive Officer, of:

(i) 692,512 stock options with an exercise price per share equal to the closing price of the Company’s common stock as reported on the Nasdaq Global Select Market on January 3, 2024, vesting over a four-year period with a contractual term of 10 years, which will vest and become exercisable as to 25 % of the option shares on January 3, 2025, and vest as to the remaining shares in successive equal quarterly installments over the subsequent three years, provided that Mr.

Lee remains in continuous service with the Company as of each vesting date, and (ii) restricted stock units for 99,520 shares of the Company’s common stock, subject to continued service with the Company as of each vesting date, to vest in four equal annual installments beginning on January 2, 2025.

Following the Inducement Award, no shares of the Company’s common stock remained reserved for issuance under the Inducement Plan.

The Inducement Plan was adopted by the board of directors without stockholder approval pursuant to Rule 5635(c)(4) of the Nasdaq Listing Rules.

In accordance with Rule 5635(c)(4) of the Nasdaq Listing Rules, awards under the Inducement Plan may only be made to an employee who has not previously been an employee or member of the board of directors or the board of directors or any parent or subsidiary, or following a bona fide period of non-employment by the Company or a parent or subsidiary, if he or she is granted such award in connection with his or her commencement of employment with the Company or a subsidiary and such grant is an inducement material to his or her entering into employment with the Company or such subsidiary.

Equity Grants

The Company’s stock option grants have an exercise price equal to the closing price of the Company’s common stock on the date of grant, generally have a 10-year contractual term and vest in increments (typically over four years from the date of grant, although the Company may occasionally grant options with different vesting terms, including grants made to its non-employee directors).

4 unchanged sentences

The June 2022 amendment and restatement increased the number of shares of common stock that may be sold under the plan by an additional 500,000 shares from the originally provided 500,000 shares.

The purpose of the ESPP is to provide a vehicle for

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-35

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

eligible employees to purchase shares of the Company’s common stock at a discounted price and to help retain and motivate current employees as well as attract new talent.

The purpose of the ESPP is to provide a vehicle for eligible employees to purchase shares of the Company’s common stock at a discounted price and to help retain and motivate current employees as well as attract new talent.

Under the ESPP, up to 1,000,000 shares of common stock may be sold.

6 unchanged sentences

During the year ended December 31, 2023, 90,317 shares were purchased and issued through the ESPP.

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-33

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The following tables contain information about the Company’s stock incentive plans at December 31, 2023:

3 unchanged sentences

2014 Inducement Plan (1)

817,093 25,061 792,032

Total 18,548,794 15,387,515 3,161,279

3 unchanged sentences

ESPP 1,000,000 570,667 429,333

(1) On December 20, 2023, in connection with Frank D.

Lee’s appointment as Chief Executive Officer, the board of directors approved the grant of inducement awards to Mr.

Lee pursuant to the Inducement Plan, which was adopted by the board of directors upon recommendation of the compensation committee of the board of directors, on December 20, 2023.

Lee’s inducement awards included stock options to purchase an aggregate of 692,512 shares of common stock with an exercise price per share equal to $ 32.07 , the closing price of the Company’s common stock as reported on the Nasdaq Global Select Market on January 3, 2024, and, subject to continued service with the Company as of each vesting date, such option will vest and become exercisable as to 25 % of the option shares on January 3, 2025, and vest as to the remaining shares in successive equal quarterly installments over the subsequent three years;

and (ii) a restricted stock unit award for 99,520 shares of the Company’s common stock, subject to continued service with the Company as of each vesting date, to vest in four equal annual installments beginning on January 2, 2025, in each case, pursuant to the terms and provisions of the Inducement Plan.

As these awards were granted subsequent to December 31, 2023, they are not reflected in the table above as awards issued.

Stock-Based Compensation

99 unchanged sentences

If the Company reported a net loss for the year, no potentially dilutive securities would be included in the computation of diluted net loss per share.

As discussed in Note 11, Debt , the Company has the option to pay cash for the aggregate principal amount due upon the conversion of its 2025 Notes, and intends to do so.

ASU 2020-06 was adopted on January 1, 2022 and requires the Company to use the if-converted method to calculate the number of potentially dilutive shares for convertible debt.

Under the if-converted method, adjustments are made to the diluted net income per common share calculation as if the Company had converted the convertible debt on the first day of each period presented.

Adjustments to the numerator are made to add back the interest expense associated with the convertible debt on a post-tax basis.

Adjustments to the denominator reflect the number of shares assumed to be convertible at the beginning of the period.

For additional information regarding the adoption of ASU 2020-06, see Note 3, Recent Accounting Pronouncements .

For the years ended December 31, 2021 and 2020, the Company used the treasury stock method to calculate dilutive shares on its convertible debt.

As discussed in Note 11, Debt , the Company has the option to pay cash for the aggregate principal amount due upon the conversion of its 2025 Notes.

For additional information on the Company’s computation, see Note 2, Summary of Significant Accounting Policies .

Prior to the Company’s adoption of ASU 2020-06, for the year ended December 31, 2021, the Company used the treasury stock method to calculate dilutive shares on its convertible debt.

The following table sets forth the computation of basic and diluted net income per common share for the years ended December 31, 2023, 2022 and 2021 (in thousands, except per share amounts):

2 unchanged sentences

Net income—basic $ 41,955 $ 15,909 $ 41,980

ASU 2020-06 convertible notes if-converted method adjustment 4,114 — —

Adjusted net income—diluted $ 46,069 $ 15,909 $ 41,980

Weighted average common shares outstanding—basic 46,222 45,521 44,262

Computation of diluted securities:

ASU 2020-06 convertible notes if-converted method adjustment 5,608 — —

Dilutive effect of stock options 51 787 1,030

20 unchanged sentences

NOTE 16— INCOME TAXES

Income (loss) before income taxes and the related tax (benefit) expense is as follows (in thousands):

Income (loss) before income taxes and the related tax expense (benefit) is as follows (in thousands):

Year Ended December 31,

13 unchanged sentences

Total deferred taxes $ 15,615 $ ( 7,945 ) $ 10,872

Total income tax (benefit) expense $ ( 2,607 ) $ 14,424 $ ( 125,434 )

A reconciliation of income tax (benefit) expense at the U.S.

Total income tax expense (benefit) $ 19,746 $ ( 2,607 ) $ 14,424

A reconciliation of income tax expense (benefit) at the U.S.

federal statutory rate to the provision for income taxes is as follows (dollars in thousands):

5 unchanged sentences

Foreign taxes ( 1,798 ) ( 2.91 ) % 248 1.86 % ( 651 ) ( 1.15 ) %

Executive compensation 1,267 9.53 % 719 1.27 % 765 3.81 %

Change in valuation allowance 2,192 3.55 % 2,871 21.58 % 3,695 6.55 %

Executive compensation 3,171 5.14 % 2,188 16.45 % 1,538 2.73 %

Stock-based compensation 4,070 6.60 % ( 2,715 ) ( 20.41 ) % ( 2,963 ) ( 5.25 ) %

Tax credits ( 3,327 ) ( 5.39 ) % ( 3,245 ) ( 24.39 ) % ( 1,690 ) ( 3.00 ) %

Reserves 389 0.63 % 984 7.40 % ( 738 ) ( 1.31 ) %

Non-Taxable or Nondeductible Items:

Interest expense — — % ( 3,477 ) ( 26.14 ) % ( 430 ) ( 0.76 ) %

1 unchanged sentence

Nondeductible expenses 975 1.58 % 1,164 8.75 % 1,929 3.42 %

Reserves 984 7.40 % ( 738 ) ( 1.31 ) % 1,539 7.66 %

Convertible debt — — % — — % ( 1,048 ) ( 5.22 ) %

Other 66 0.10 % ( 85 ) ( 0.64 ) % ( 512 ) ( 0.92 ) %

Income tax (benefit) expense and effective tax rate $ ( 2,607 ) ( 19.60 ) % $ 14,424 25.57 % $ ( 125,434 ) ( 624.39 ) %

Income tax expense (benefit) and effective tax rate $ 19,746 32.00 % $ ( 2,607 ) ( 19.60 ) % $ 14,424 25.57 %

Pacira BioSciences, Inc.

4 unchanged sentences

At each reporting date, the Company considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets.

During the year ended December 31, 2020, the Company determined there was sufficient positive evidence to conclude that it was more-likely-than-not the domestic deferred taxes of $ 126.6 million were realizable and, therefore, the domestic valuation allowance was released.

The Company maintains a full valuation allowance on its foreign net deferred tax balances as it is more-likely-than-not the tax benefits are not realizable.

The Company records a valuation allowance on U.S.

capital losses and on foreign net deferred tax balances as it is more-likely-than-not the tax benefits are not realizable.

Significant components of the Company’s deferred tax assets and liabilities at December 31, 2023 and 2022 are as follows (in thousands):

4 unchanged sentences

Stock based compensation 27,520 27,473

Deferred revenue — 2,430

Inventory reserves 2,149 4,889

10 unchanged sentences

The Company also had state NOLs and state tax credit carryforwards of $ 507.6 million and $ 7.3 million, respectively, which are subject to change on an annual basis due to variations in the Company’s annual state apportionment factors.

The federal and state NOLs will begin to expire in 2032 and 2028, respectively.

There are no remaining unlimited federal NOLs.

The state NOLs will begin to expire in 2028.

The Company had non-U.S.

tax NOLs of $ 6.5 million at December 31, 2022.

NOLs of $ 5.5 million at December 31, 2023.

NOLs do not expire.

1 unchanged sentence

Such ownership changes were triggered by the initial acquisition of the Company’s stock in 2007 as well as cumulative ownership changes arising as a result of the completion of the Company’s initial public offering, other financing transactions and the Flexion Acquisition in 2021.

As a result of these ownership changes, the Company estimates $ 516.2 million of federal NOLs are subject to annual limitations and are estimated to be available as follows:

$ 32.6 million will come available in 2023, $ 32.5 million in 2024, $ 32.4 million in 2025, $ 28.3 million in 2026, and $ 6.9 million in 2027 and thereafter.

As a result of these ownership changes, the Company has $ 483.6 million of federal NOLs subject to annual limitations and are available as follows:

$ 32.5 million will become available in 2024, $ 32.4 million in 2025, $ 28.3 million in 2026, and $ 6.9 million in 2027 and thereafter.

In accordance with ASC Topic 740, the Company establishes a valuation allowance for deferred tax assets that, in its judgment, are not more-likely-than-not realizable.

2 unchanged sentences

The Company had a net increase in its valuation allowance of $ 2.6 million and $ 3.9 million for the years ended December 31, 2023 and 2022, respectively.

The current year net increase in The Company’s valuation allowance includes $ 2.5 million against U.S.

capital loss carryforwards, $ 0.9 million against Flexion Acquisition state attributes and $ 0.5 million against foreign net deferred tax assets.

The current year net increase in the Company’s valuation allowance includes $ 2.5 million against foreign net deferred tax assets and $ 0.1 million against U.S.

capital loss carryforwards.

The Company continues to maintain a full valuation allowance against foreign net deferred tax assets since it is more-likely-than-not the tax benefit related to the foreign losses are not realizable.

In 2023 , the Company recorded a $ 0.4 million net increase to unrecognized tax benefits, or UTBs of which a $ 0.6 million increase is related to tax credit positions taken during the year, offset by a $ 0.2 million reduction related to prior year tax credit

Pacira BioSciences, Inc.

2 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

In 2022 , the Company recorded a $ 2.7 million net reduction to unrecognized tax benefits, or UTBs of which $ 3.7 million is a full reduction in Flexion acquired tax credits, offset by a $ 0.2 million increase related to prior year tax credit and $ 0.8 million related to tax credit positions taken during the year.

The Company’s UTB liability at December 31, 2023 was $ 6.7 million.

The change in the Company’s UTBs for the year ended December 31, 2023 is summarized as follows (in thousands):

Balance as December 31, 2020 $ 6,076

Balance at December 31, 2021 $ 9,021

Reduction for prior year positions ( 3,526 )

1 unchanged sentence

Balance at December 31, 2022 6,322

Reduction for prior year positions ( 3,526 )

Additions for current year positions 553

Reduction for prior year positions ( 164 )

Balance at December 31, 2023 $ 6,711

1 unchanged sentence

The Company regularly assesses the likelihood of additional tax assessments by jurisdiction and, if necessary, adjusts its reserve for UTBs based on new information or developments.

Due to the Company’s tax credit carryforwards, the reserve was recorded as a reduction of the Company’s deferred tax assets, and any potential deficiency would not result in a tax liability.

Therefore, no interest or penalties were recognized in income tax expense for the years ended December 31, 2022, 2021 and 2020.

Of the UTB balance at December 31, 2023, $ 5.7 million was recorded as a reduction to the Company’s deferred tax assets.

Any potential deficiency would not result in a tax liability, therefore, no interest or penalties were recognized in income tax expense for the years ended December 31, 2023, 2022 and 2021 for positions recorded to the Company’s deferred tax assets.

During 2023, $ 1.0 million of reserves previously recorded to deferred tax assets were reclassified to the Company’s other long-term liabilities.

The reclassification was required as the Company is utilizing tax credits in the current year and also filed amended returns to claim tax credits, both of which result in a reduction to the Company’s tax liabilities.

No interest or penalties were recognized in income tax expense for the $ 1.0 million of reserve recorded to the Company’s other long-term liabilities as any potential deficiency would not result in a tax liability until next year.

The Company is currently subject to audit by the U.S.

1 unchanged sentence

However, the IRS or states may still examine and adjust an NOL arising from a closed year to the extent it is utilized in a year that remains subject to audit.

The Company’s previously filed income tax returns are not presently under audit by the IRS or state tax authorities.

The Company’s previously filed income tax returns are not presently under audit by the IRS.

The Company is under a state audit for the years 2020 through 2021.

NOTE 17— EMPLOYEE BENEFIT PLANS

4 unchanged sentences

Deferred Compensation Plan

In June 2020, the Company’s board of directors adopted the Company’s Deferred Compensation Plan, or DCP.

The Company intends that the DCP constitute, and be construed and administered as, an unfunded plan of deferred compensation within the meaning of the Employee Retirement Income Security Act of 1974, as amended, and the IRC of 1986, as amended, under which eligible participants may elect to defer the receipt of current compensation.

The Company intends that its Deferred Compensation Plan, or DCP, constitute, and be construed and administered as, an unfunded plan of deferred compensation within the meaning of the Employee Retirement Income Security Act of 1974, as amended, and the IRC of 1986, as amended, under which eligible participants may elect to defer the receipt of current compensation.

Eligible participants include select management and highly compensated employees of the Company, including the Company’s named executive officers.

3 unchanged sentences

Funds held in the rabbi trust must be used to pay benefits to DCP participants, except in the case of the Company’s bankruptcy or insolvency, in which case, they become subject to claims by the Company’s creditors.

The Company recognized $ 0.3 million of related compensation expense for its DCP discretionary match for the year ended December 31, 2022 and $ 0.2 million for each of the years ended December 31, 2021 and 2020.

The carrying value of assets held in the rabbi trust substantially equaled the DCP liability as of both December 31, 2022 and 2021, with balances of $ 4.3 million and $ 2.6 million, respectively.

The rabbi trust asset is classified within other assets and the DCP liability is classified within other liabilities in the consolidated balance sheets.

The Company recognized $ 0.3 million, $ 0.3 million and $ 0.2 million of related compensation expense for its DCP discretionary match for the years ended

Pacira BioSciences, Inc.

2 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

December 31, 2023, 2022 and 2021, respectively.

The carrying value of assets held in the rabbi trust equaled the DCP liability as of both December 31, 2023 and 2022.

As of December 31, 2023, the carrying value of the assets held in the rabbi trust was $ 6.9 million, of which $ 0.7 million is classified as current.

As of December 31, 2022, the carrying value of the assets held in the rabbi trust was $ 4.3 million, of which $ 0.1 million was classified as current.

The rabbi trust current and noncurrent assets are classified within prepaid expenses and other assets and investments and other assets, respectively, within the consolidated balance sheets.

The DCP current and noncurrent liabilities are classified within accrued expenses and other liabilities, respectively, within the consolidated balance sheets.

Cash Long-Term Incentive Plan

In December 2020, the Company’s board of directors adopted a cash long-term incentive plan, or LTIP, commencing in 2021, focused on pre-determined, objective performance goals.

The LTIP provides cash awards to participants based on the achievement of certain performance goals during each applicable performance period from January 1 through December 31 of each calendar year.

The Company’s cash long-term incentive plan, or LTIP, is focused on pre-determined and objective performance goals during each applicable performance period from January 1 through December 31 of each calendar year.

Award amounts ranging from 0 % to 225 % of the target cash award can be earned based on achievement of two equally weighted financial metrics:

2 unchanged sentences

For the years ended December 31, 2023 and 2022, the Company recognized $ 0.5 million and $ 1.0 million of related compensation expense under the LTIP, respectively, all of which related to the 2021 performance period.

Amounts earned for the 2021 performance year are payable to participants in January 2025 after the three-year vesting period concludes.

No amounts were earned for the 2022 performance period.

Amounts earned for the 2021 performance year are payable to participants in January 2025 after a three-year vesting period concludes.

No amounts were earned by participants for the 2022 and 2023 performance periods.

As of December 31, 2023 and 2022, there was $ 2.7 million and $ 2.2 million included in other liabilities in the consolidated balance sheets, respectively.

NOTE 18— ACQUISITION-RELATED CHARGES (GAINS), IMPAIRMENT AND OTHER

Acquisition-related charges (gains), impairment and other for the years ended December 31, 2022, 2021 and 2020 are summarized below (in thousands):

NOTE 18— CONTINGENT CONSIDERATION (GAINS) CHARGES, ACQUISITION-RELATED CHARGES AND OTHER

Contingent consideration (gains) charges, acquisition-related charges and other for the years ended December 31, 2023, 2022 and 2021 are summarized below (in thousands):

Year Ended December 31,

2023 2022 2021

Contingent consideration (gains) charges:

Flexion contingent consideration $ ( 3,424 ) $ ( 18,292 ) $ 1,174

MyoScience contingent consideration — ( 11,184 ) ( 2,163 )

Total contingent consideration (gains) charges ( 3,424 ) ( 29,476 ) ( 989 )

Acquisition-related charges:

Severance-related expenses — 4,494 26,371

2 unchanged sentences

Total acquisition-related charges 1,963 11,245 40,900

Flexion contingent consideration ( 18,292 ) 1,174 —

MyoScience contingent consideration ( 11,184 ) ( 2,163 ) 5,204

Restructuring charges 1,109 — —

Impairment of acquired IPR&D — 26,134 —

2 unchanged sentences

agreement dissolution costs — — 3,000

Discontinuation of DepoCyt(e) — — ( 188 )

Total acquisition-related charges (gains), impairment and other $ 10,903 $ 42,911 $ 5,166

Flexion Acquisition

The Company recognized acquisition-related and other costs of $ 11.2 million and $ 40.2 million during the years ended December 31, 2022 and 2021, respectively, primarily for severance, legal fees, third-party services and other one-time charges related to the Flexion Acquisition.

See Note 5, Flexion Acquisition , for more information.

On November 19, 2021, as part of the purchase price consideration related to the Flexion Acquisition, the Company recorded a contingent consideration of $ 45.2 million, which represents the Company’s potential achievement of meeting regulatory and sales-based milestones.

For the year ended December 31, 2022, the Company recognized a contingent consideration gain of $ 18.3 million due to a decrease to the fair value of its contingent consideration.

From the date of the acquisition through December 31, 2021, the Company recorded a contingent consideration charge of $ 1.2 million.

See Note 12, Financial Instruments , for information regarding the method and key assumptions used in the fair value measurements of the Company’s contingent consideration.

MyoScience Acquisition

The Company recognized contingent consideration gains of $ 11.2 million and $ 2.2 million for the years ended December 31, 2022 and 2021, respectively, and a contingent consideration charge of $ 5.2 million for the year ended December 31, 2020.

See Note 12, Financial Instruments , for information regarding the method, key assumptions used in the fair value measurements of contingent consideration and more information regarding the changes in fair value.

Total contingent consideration (gains) charges, acquisition-related charges and other $ ( 352 ) $ 10,903 $ 42,911

Pacira BioSciences, Inc.

2 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The Company recognized acquisition-related and other charges of $ 0.7 million and $ 0.2 million during the years ended December 31, 2021 and 2020, respectively, related to one-time termination benefits and fees associated with the MyoScience Acquisition.

Flexion Acquisition Contingent Consideration

For the years ended December 31, 2023 and 2022, the Company recognized contingent consideration gains of $ 3.4 million and $ 18.3 million, respectively, due to a decrease in the fair value of its contingent consideration.

From the date of the Flexion Acquisition through December 31, 2021, the Company recorded a contingent consideration charge of $ 1.2 million.

See Note 12, Financial Instruments , for information regarding the method and key assumptions used in the fair value measurements of the Company’s contingent consideration and more information regarding the changes in fair value.

MyoScience Acquisition Contingent Consideration

The Company recognized contingent consideration gains related to the MyoScience Acquisition of $ 11.2 million and $ 2.2 million for the years ended December 31, 2022 and 2021, respectively.

See Note 12, Financial Instruments , for information regarding the method and the changes in fair value.

Restructuring Charges

In J une 2023, t he Company implemented a restructuring plan in an effort to improve its operational efficiencies.

The restructuring charges were predominantly related to one-time employee termination benefits through a reduction of headcount, such as severance and related costs.

During the year ended December 31, 2023, t he Company recognized $ 1.1 million of restructuring charges.

Acquisition-Related Charges

The Company recognized acquisition-related and other costs of $ 2.0 million during the year ended December 31, 2023 primarily related to vacant and underutilized Flexion leases that were assumed from the Flexion Acquisition.

See Note 5, Flexion Acquisition , for more information.

Also included in the year ended December 31, 2021, the Company recognized acquisition-related and other charges of $ 0.7 million related to one-time termination benefits and fees associated with the MyoScience Acquisition.

Impairment of Acquired IPR&D

2 unchanged sentences

Termination of License Agreement

The Company recognized expense of $ 3.0 million in the year ended December 31, 2022 related to the termination of a license agreement.

The Company recognized expense of $ 3.0 million during the year ended December 31, 2022 related to the termination of a license agreement.

See Note 20, Commitments and Contingencies , for more information.

Nuance Biotech Co.

Agreement Dissolution Costs

In June 2018, the Company entered an agreement with Nuance Biotech Co.

2 unchanged sentences

In April 2021, the Company and Nuance agreed to a mutual termination of the agreement due to the lack of a viable regulatory pathway that adequately safeguards the Company’s intellectual property against the risk of a generic product, which included dissolution costs of $ 3.0 million during the year ended December 31, 2021.

DepoCyt(e) Discontinuation

In April 2018, the Company received formal notice of the termination of a Supply Agreement and a Distribution Agreement (and all related agreements as subsequently amended) from Mundipharma International Corporation Limited and Mundipharma Medical Company, respectively (collectively, “Mundipharma”).

In November 2019, the Company reached a settlement with Mundipharma and made a $ 5.3 million payment related to the DepoCyt(e) discontinuation which had previously been accrued.

The Company recorded a gain of $ 0.2 million during the year ended December 31, 2020 related to the discontinuation of its DepoCyt(e) manufacturing activities in June 2017.

The foregoing references to DepoCyt(e) mean DepoCyt ® when discussed in the context of the U.S.

and Canada and DepoCyte ® when discussed in the context of the E.U.

NOTE 19— COMMERCIAL PARTNERS AND OTHER AGREEMENTS

1 unchanged sentence

In April 2014, the Company and Thermo Fisher entered into a Strategic Co-Production Agreement, a Technical Transfer and Service Agreement (the “EXPAREL Technical Transfer and Service Agreement”) and a Manufacturing and Supply Agreement to collaborate in the manufacture of EXPAREL.

Under the terms of the EXPAREL Technical Transfer and Service Agreement, Thermo Fisher agreed to undertake certain technical transfer activities and construction services needed to prepare its Swindon, England facility for the manufacture of EXPAREL in two dedicated suites.

The Company contracted to purchase EXPAREL from Thermo Fisher, beginning with FDA approval of the first suite, which occurred in May 2018.

Commercial production began in February 2019.

The Company is now utilizing a second, larger-scale dedicated manufacturing suite.

Under the terms of the EXPAREL Technical Transfer and Service Agreement, Thermo Fisher undertook certain technical transfer activities and construction services needed to prepare its Swindon, England facility for the manufacture of EXPAREL in dedicated manufacturing suites.

The Company is now utilizing

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-42

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

a second, larger-scale dedicated manufacturing suite.

Under these agreements, the Company makes monthly base fee payments to Thermo Fisher.

Unless earlier terminated by giving notice of up to two years (other than termination by the Company in the event of a material breach by Thermo Fisher), this agreement will expire in May 2028.

Prior to the Flexion Acquisition, in July 2015, Flexion and Thermo Fisher entered into a Manufacturing and Supply Agreement and a Technical Transfer and Service Agreement related to the manufacture of ZILRETTA at the same Thermo Fisher site in Swindon, England where the Company’s EXPAREL suites are located.

Unless earlier terminated by providing 18 months’ notice (other than termination by the Company in the event of a material breach by Thermo Fisher), this agreement will expire in May 2028.

Prior to the Flexion Acquisition, in July 2015, Flexion and Thermo Fisher entered into a Manufacturing and Supply Agreement (the “ZILRETTA Manufacturing and Supply Agreement”) and a Technical Transfer and Service Agreement related to the manufacture of ZILRETTA at the same Thermo Fisher site in Swindon, England where the Company’s EXPAREL manufacturing suite is located.

Thermo Fisher agreed to undertake certain transfer activities and construction services needed to prepare its facility for the commercial manufacture of ZILRETTA in dedicated manufacturing suites.

2 unchanged sentences

The Company also reimburses Thermo Fisher for purchases of materials and equipment made on its behalf, certain nominal expenses and additional services.

Unless earlier terminated (other than termination by the Company in the event that Thermo Fisher does not

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-44

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

meet specified milestones or for a breach by Thermo Fisher), the Company will be obligated to pay for the costs incurred by Thermo Fisher associated with the removal of its manufacturing equipment and for Thermo Fisher’s termination costs up to a specified capped amount.

Unless earlier terminated (other than termination by the Company in the event that Thermo Fisher does not meet specified milestones or for a breach by Thermo Fisher), the Company will be obligated to pay for the costs incurred by Thermo Fisher associated with the removal of its manufacturing equipment and for Thermo Fisher’s termination costs up to a specified capped amount.

The initial term of the ZILRETTA Manufacturing and Supply Agreement that the Company assumed as part of the Flexion Acquisition expires in October 2027.

The Company pays a monthly base fee to Thermo Fisher for the operation of the manufacturing suites and a per product fee for each vial of ZILRETTA based upon a forecast of commercial demand.

The Company also reimburses Thermo Fisher for purchases of materials and equipment made on its behalf, certain nominal expenses and additional services.

The ZILRETTA Manufacturing and Supply Agreement will remain in full effect unless and until it expires or is terminated.

The Company may terminate this agreement upon one month ’s notice if a regulatory authority causes the withdrawal of ZILRETTA from the U.S.

or any other market that represents 80 percent of its overall sales, or at any time for convenience by providing 24 months’ notice.

Either party may terminate the ZILRETTA Manufacturing and Supply Agreement in the event of the breach or bankruptcy of the other party.

Upon termination of the ZILRETTA Manufacturing Agreement (other than termination by the Company in the event that Thermo Fisher does not meet the manufacturing milestones or for a breach by Thermo Fisher), the Company will be obligated to pay for the costs incurred by Thermo Fisher associated with the removal of its manufacturing equipment and for Thermo Fisher’s termination costs up to a specified capped amount.

Eurofarma Laboratories S.A.

8 unchanged sentences

The Company began selling iovera° in Canada in the fourth quarter of 2021.

DePuy Synthes Sales, Inc.

In January 2017, the Company announced a Co-Promotion Agreement with DePuy Synthes Sales, Inc., or DePuy Synthes, part of the Johnson & Johnson family of companies, to market and promote the use of EXPAREL for orthopedic procedures in the U.S.

DePuy Synthes field representatives, specializing in joint reconstruction, spine, sports medicine, trauma and cranio-maxillofacial (CMF) procedures, collaborated with and supplemented the Company’s field teams by expanding the reach and frequency of EXPAREL education in the hospital surgical suite and ambulatory surgery center settings.

In July 2020, the Company notified DePuy Synthes that the Co-Promotion Agreement would terminate on January 2, 2021.

The Company recorded termination-related costs of $ 8.8 million which were recorded in selling, general and administrative expense during the year ended December 31, 2020.

GQ Bio Therapeutics GmbH

In April 2023, the Company entered into a process development agreement with GQ Bio Therapeutics GmbH, or GQ, for the development of a commercially scalable manufacturing process for the production of PCRX-201.

The agreement calls for the Company to pay GQ upon three milestones that can be achieved independently of each other.

Milestone 1 includes a € 0.5 million payment to GQ for the execution and completion of a feasibility assessment proposal for scalable process to support milestone 2.

Achieving milestone 2 is associated with the development of a qualified program process for PCRX-201 where GQ would build a direct manufacturing cost of a PCRX-201 unit.

Based on the direct manufacturing cost, the Company would pay GQ a success fee within a scale of € 0.5 million up to € 7.5 million, plus royalties within a scale of 0.25 % to 3.75 % of net sales associated with PCRX-201.

The achievement of milestone 3 requires the Company to pay GQ € 0.5 million for delivering a validatable manufacturing process and validated analytical control package necessary for initiating process validation.

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-43

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

GQ is one of the Company’s equity investments and convertible notes receivables classified within investments and other assets in the consolidated balance sheets.

See Note 12, Financial Instruments , for more information.

Aratana Therapeutics, Inc.

8 unchanged sentences

Aratana began purchasing bupivacaine liposome injectable suspension product in 2016, which they market under the trade name NOCITA ® (a registered trademark of Aratana) for veterinary use.

Carlisle Companies, Inc.

In January 2020, the Company and Carlisle Companies, Inc., or Carlisle, entered into a Manufacturing and Supply Agreement (the “Carlisle Agreement”) to collaborate in the manufacture of iovera° Smart Tips at Carlisle’s Tijuana, Mexico facility.

The initial term of the Carlisle Agreement is five years with automatic one-year extensions unless either party provides prior notice in writing.

Under the Carlisle Agreement, the Company pays fees based on the amount of iovera° Smart Tips delivered by Carlisle.

Since April 2022, all iovera° Smart Tips have been produced by Carlisle.

The Carlisle Agreement may be terminated by either party upon one year s’ written notice without cause.

The Company may terminate the Carlisle Agreement upon thirty days ’ written notice in the event that iovera° is withdrawn from the market or no longer sold by us.

Either party may terminate the Carlisle Agreement in the event of the breach or bankruptcy of the other party.

NOTE 20— COMMITMENTS AND CONTINGENCIES

2 unchanged sentences

Except as described below, the Company is not presently a party to any legal proceedings that it believes to be material, and is not aware of any pending or threatened litigation against the Company which it believes could have a material adverse effect on its business, operating results, financial condition or cash flows.

Pacira BioSciences, Inc.

| 2022 Form 10-K | Page F-45

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

MyoScience Milestone Litigation

4 unchanged sentences

The total remaining value of these milestones is $ 30.0 million, plus attorneys’ fees.

The Company believes that the counterclaim from Fortis is without merit and intends to vigorously defend against all claims.

A trial was conducted in September 2023, and a decision is expected before the end of the first half of 2024.

The Company is unable to predict the outcome of this action at this time.

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-44

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

eVenus Pharmaceutical Laboratories Litigations

In October 2021, the Company received a Notice Letter advising that eVenus Pharmaceutical Laboratories, Inc., or eVenus, of Princeton, New Jersey, submitted to the FDA an Abbreviated New Drug Application (ANDA) with a Paragraph IV certification seeking authorization for the manufacturing and marketing of a generic version of EXPAREL (266 mg/20 mL) in the U.S.

In October 2021, the Company received a Notice Letter advising that eVenus Pharmaceutical Laboratories, Inc., or eVenus, of Princeton, New Jersey, submitted to the FDA an Abbreviated New Drug Application, or ANDA with a Paragraph IV certification seeking authorization for the manufacturing and marketing of a generic version of EXPAREL (266 mg/20 mL) in the U.S.

prior to the expiration of U.S.

13 unchanged sentences

This filing triggered a second automatic 30-month stay of final approval for the 133 mg/10 mL ANDA product.

These litigations are in their early stages, and the Company is unable to predict their outcome at this time.

The first and second patent infringement suits were consolidated.

In February 2023, eVenus filed its first amended answer to the first amended complaint, alleging patent invalidity, non-infringement and inequitable conduct.

The Company has denied the allegations in eVenus’s first amended answer.

The Company has subsequently voluntarily dismissed its claims with respect to the ’336 Patent.

The trial on the remaining claim occurred in February 2024 with a decision expected to be reached late in the first half of 2024.

In April 2023, the Company filed a third patent infringement suit against eVenus, its parent company, and Fresenius Kabi USA, LLC, in the U.S.

District Court for the District of New Jersey (23-cv-2367) asserting that the 133 mg/10 mL and 266 mg/20 mL ANDA products will infringe U.S.

11,426,348 (the ’348 patent).

In July 2023, eVenus filed its answer with claims for declaratory judgment, alleging patent invalidity, non-infringement and inequitable conduct with respect to the ’348 patent as well as the Company’s other patents, U.S.

11,357,727 and 11,452,691.

The parties have subsequently dismissed all patents other than the ’348 patent from this litigation.

The Company is unable to predict the outcome of these litigations at this time.

Research Development Foundation

1 unchanged sentence

RDF has the right to terminate the agreement for an uncured material breach by the Company, in connection with its bankruptcy or insolvency or if it directly or indirectly opposes or disputes the validity of the assigned patent rights.

The Company’s ’495 patent issued on June 15, 2021.

The Company’s ’495 patent was issued on June 15, 2021.

Thereafter, RDF asserted that the issuance of that patent extends the Company’s royalty obligations under the agreement until 2041.

3 unchanged sentences

The lawsuit seeks a declaration from the court that the Company owes no royalties to RDF with respect to its EXPAREL product after December 24, 2021.

During the pendency of the lawsuit, the Company will continue to pay royalties to RDF under protest, however, the Company is unable to predict the outcome of this action at this time.

On August 8, 2023, the United States District Court, District of Nevada, granted the Company’s motion for partial summary judgment in respect to the Company’s claim for a declaration that it no longer owes royalties for EXPAREL made under the 45-liter manufacturing process as of December 24, 2021.

As a result, the Company expects to receive $ 14.5 million from RDF, representing the royalties that the Company paid to RDF under protest after December 24, 2021 for EXPAREL made from the 45-liter manufacturing process.

Once it becomes probable that the settlement amount will be received, the

Pacira BioSciences, Inc.

2 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Company will record a settlement gain within other operating expenses in the condensed consolidated statement of operations.

In November 2023, the United States District Court, District of Nevada conducted a mediation that did not result in a settlement.

During the pendency of the remaining lawsuit, the Company will continue to pay royalties associated with the 200-liter manufacturing process to RDF under protest.

The Company is unable to predict the outcome of this action at this time.

Purchase Obligations

The Company has approximately $ 71.4 million of minimum, non-cancelable contractual commitments for contract manufacturing services and $ 14.2 million of minimum, non-cancelable contractual commitments for the purchase of certain raw materials as of December 31, 2023.

Subsequent to December 31, 2022, the Company entered into an additional $ 2.8 million of minimum, non-cancelable contractual commitments for marketing sponsorships.

As of December 31, 2023, the Company has $ 4.9 million of other minimum, non-cancelable contractual commitments.

Other Commitments and Contingencies

8 unchanged sentences

In July 2022, the Company submitted notice to HK Tainuo of its intent to pursue termination of the license agreement.

As of December 31, 2022, $ 13.0 million was recorded within accrued expenses in the consolidated balance sheet.

The $ 13.0 million related to the termination of the license agreement was subsequently paid in January 2023.

The $ 13.0 million related to the termination of the license agreement was paid in January 2023.

Pediatric Trial Commitments

The FDA, as a condition of EXPAREL approval, has required the Company to study EXPAREL in pediatric patients, as well as the administration of EXPAREL as a nerve block in the pediatric setting.

The Company was granted a deferral for the required pediatric trials until after the indications were approved in adults.

The FDA, as a condition of EXPAREL approval, has required the Company to study EXPAREL for infiltration and as a brachial plexus block in pediatric patients.

The Company was granted deferrals for the required pediatric trials until after the indications were approved in adults.

Similarly, in Europe, the Company agreed with the European Medicines Agency, or EMA, on a Pediatric Investigation Plan as a prerequisite for submitting a Marketing Authorization Application (MAA) in the E.U.

2 unchanged sentences

Those positive results were the basis for the submission of a supplemental New Drug Application, or sNDA, in the U.S.

and Type II variations in the E.U.

to expand the EXPAREL label to include use in patients six years of age and older for single-dose infiltration to produce postsurgical local analgesia.

In March 2021, the Company announced that the FDA approved the submission of the sNDA in the U.S.

The EMA and the Medicines and Healthcare Products Regulatory Agency, or MHRA, are still reviewing the Type II variations.

The Company is working with the FDA, MAA and MHRA to finalize the regulatory pathway for its remaining pediatric commitments.

to include use in patients six years of age and older for single-dose infiltration to produce postsurgical local analgesia.

In March 2021, the Company announced that the FDA approved the sNDA in the U.S.

and U.K., the Company also submitted the results of the PLAY study as Type II variations in the E.U.

to include the use of EXPAREL in children aged six years or older as a field block for treatment of somatic post-operative pain for small- to medium-sized wounds.

The EMA and the Medicines and Healthcare Products Regulatory Agency, or MHRA, in the U.K.

both approved the variations in their respective regions in November 2022.

The Company received notification from the FDA in October 2023 that its pediatric studies requirement had been waived for the indication of brachial plexus interscalene nerve block to produce postsurgical regional analgesia in pediatric patients.

The Company is still working with the FDA, EMA and MHRA to finalize the regulatory pathways for its remaining pediatric commitments.

Contingent Milestone Payments

Refer to Note 5, Flexion Acquisition and Note 12 , Financial Instruments , for information on potential contingent milestone payments related to the Flexion Acquisition and MyoScience Acquisition.

PCRX-201 was added to the Company’s portfolio as part of the Flexion Acquisition as discussed in Note 5, Flexion Acquisition .

Prior to the Flexion Acquisition, in February 2017, Flexion entered into an agreement with GQ Bio Therapeutics GmbH (formerly named GeneQuine Biotherapeutics GmbH) to acquire the global rights to PCRX-201, a gene therapy product candidate.

Pacira BioSciences, Inc.

| 2023 Form 10-K | Page F-46

PACIRA BIOSCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

PCRX-201, a novel, intra-articular gene therapy product candidate that produces the anti-inflammatory protein interleukin-1 receptor antagonist (IL-1Ra) treating OA pain in the knee, was added to the Company’s portfolio as part of the Flexion Acquisition in November 2021 as discussed in Note 5, Flexion Acquisition .

Prior to the Flexion Acquisition, in February 2017, Flexion entered into an agreement with GQ to acquire the global rights to PCRX-201, a gene therapy product candidate.

As part of the agreement, up to an aggregate of $ 56.0 million of payments could become due upon the achievement of certain development and regulatory milestones, including up to $ 4.5 million through initiation of a Phase 2 proof of concept clinical trial and, following successful proof of concept, up to an additional $ 51.5 million in development and global regulatory approval milestone payments.

NOTE 21—SUBSEQUENT EVENT

In February 2024, the Company initiated a restructuring plan to ensure it is well positioned for long-term growth.

The restructuring plan includes:

(i) reshaping the Company’s executive team;

(ii) reallocating efforts and resources from the Company’s ex-U.S.

and certain early-stage development programs to its commercial portfolio in the U.S.

and (iii) reprioritizing investments to focus on commercial readiness for the Non-Opioids Prevent Addiction In the Nation (“NOPAIN”) Act that takes effect in 2025 and broader commercial initiatives in key areas, such as strategic national accounts, marketing and market access and reimbursement.

The Company recognized approximately $ 5 million of restructuring charges in February 2024 related to employee termination benefits, such as the acceleration of share-based compensation, severance, and, to a lesser extent, other employment-related termination costs.

Pacira BioSciences, Inc.

1 unchanged sentence

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