What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-08-10 compared with 2022-05-10 · 221 added, 165 removed, 465 unchanged (45% of the section changed)

FINANCIAL STATEMENTS

HOLDINGS CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

thousands, except par value and share data)

(in thousands,

except par value and share data)

Current assets:

7 unchanged sentences

Cost method investment

Deferred tax asset, net

Deferred tax assets, net

Warrant assets

14 unchanged sentences

5,000,000 shares authorized;

no shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively

no shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively

Common stock, $ 0.001 par value;

250,000,000 shares authorized;

12,834,813 and 12,836,133 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively

12,839,118 and 12,836,133 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively

Additional paid-in capital

6 unchanged sentences

notes to the unaudited condensed consolidated financial statements.

HOLDINGS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

thousands, except per share data)

(in thousands,

except per share data)

Three Months Ended

Six Months Ended

Finance receivable interest income, including fees

4 unchanged sentences

Pharmaceutical manufacturing, research and development expense

Change in fair value of acquisition-related contingent consideration

Depreciation and amortization expense

7 unchanged sentences

Net income per share

Weighted Average Shares

Weighted average shares outstanding

See accompanying

notes to the unaudited condensed consolidated financial statements.

HOLDINGS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

thousands, except share data)

Months Ended March 31, 2022

(in thousands,

except share data)

Six Months Ended June 30, 2022

Stockholders’

at December 31, 2021

Paid-In Capital

Balances at December 31, 2021

$ ( 4,164,496 )

of common stock upon vesting of restricted stock

of unvested restricted stock

at March 31, 2022

Stock-based compensation

Issuance of common stock upon vesting of restricted stock

Forfeiture of unvested restricted stock

Balances at March 31, 2022

( 4,161,018 )

Months Ended March 31, 2021

Stock-based compensation

Issuance of common stock upon vesting of restricted stock

Balances at June 30, 2022

$ ( 4,160,453 )

Six Months Ended June 30, 2021

Stockholders’

at December 31, 2020

Paid-In Capital

Balances at December 31, 2020

$ ( 4,190,425 )

of common stock upon vesting of restricted stock

at March 31, 2021

Stock-based compensation

Issuance of common stock upon vesting of restricted stock

Balances at March 31, 2021

( 4,187,036 )

Stock-based compensation

Issuance of common stock upon vesting of restricted stock

Balances at June 30, 2021

$ ( 4,173,066 )

See accompanying

notes to the unaudited condensed consolidated financial statements.

HOLDINGS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

(in thousands)

Six Months Ended

Cash flows from operating activities:

4 unchanged sentences

Change in fair value of equity securities

Change in fair value of acquisition-related contingent consideration

Loan discount amortization and fee accretion

7 unchanged sentences

Cash flows from investing activities:

Investment in equity securities

Investment in finance receivables

2 unchanged sentences

Purchases of property and equipment

Net cash used in investing activities

Net cash provided by investing activities

Cash flows from financing activities:

Net payments on credit facility

Payment of acquisition-related contingent consideration

Net cash used in financing activities

Net decrease in cash and cash equivalents

Net increase in cash and cash equivalents

Cash and cash equivalents at beginning of period

2 unchanged sentences

notes to the unaudited condensed consolidated financial statements.

HOLDINGS CORPORATION

TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SWK Holdings Corporation and Summary of Significant Accounting Policies

9 unchanged sentences

the sales of life science products by third parties.

The Company is headquartered in Dallas, Texas, and as of March 31, 2022,

the Company had 35 full-time employees.

The Company is headquartered in Dallas, Texas, and as of June 30, 2022, the

Company had 34 full-time employees.

Company has net operating loss carryforwards (“NOLs”) and believes that the ability to utilize these NOLs is an important

5 unchanged sentences

might result in the ability to utilize more of the NOLs.

of May 4, 2022, the Company and its partners have executed transactions with 45 different parties under its specialty finance

strategy, funding an aggregate of $643.2 million in various financial products across the life science sector.

of August 3, 2022, the Company and its partners have executed transactions with 46 different parties under its specialty

finance strategy, funding an aggregate of $649.6 million in various financial products across the life science sector.

The Company’s

1 unchanged sentence

sector, and purchased royalties generated by sales of life science products and related intellectual property.

August 26, 2019, the Company commenced its Pharmaceutical Development segment with the acquisition of Enteris BioPharma, Inc.

Enteris is a clinical stage biopharmaceutical company offering innovative formulation solutions built

around its proprietary oral drug delivery technologies, the Peptelligence® platform.

Since its founding in 2013, Enteris has

advanced multiple internal and external programs leveraging Peptelligence®, which enables the oral delivery of molecules that

are typically injected, including peptides and BCS Class II, III, and IV small molecules, in an enteric-coated tablet formulation.

Peptelligence® utilizes a unique multifaceted approach to increase the solubility and absorption of peptides and small molecules,

addressing the complex challenges regarding solubility and permeability of therapeutics with low oral bioavailability.

2019, the Company commenced its Pharmaceutical Development segment with the acquisition of Enteris BioPharma, Inc.

Enteris is a clinical stage biopharmaceutical company offering innovative formulation solutions built around its proprietary oral

drug delivery technologies, the Peptelligence® platform.

Since its founding in 2013, Enteris has advanced multiple internal

and external programs leveraging Peptelligence®, which enables the oral delivery of molecules that are typically injected,

including peptides and BCS Class II, III, and IV small molecules, in an enteric-coated tablet formulation.

Peptelligence®

utilizes a unique multifaceted approach to increase the solubility and absorption of peptides and small molecules, addressing

the complex challenges regarding solubility and permeability of therapeutics with low oral bioavailability.

Peptelligence®

is protected by an extensive patent estate that extends until 2036.

96 unchanged sentences

2022-02, “Financial Instruments - Credit Losses (Topic 326):

Troubled Debt Restructurings and Vintage Disclosures, which

updates the requirements for accounting for credit losses under ASC 326, eliminates the accounting guidance on troubled debt restructurings

for creditors, and enhances creditors’ disclosure requirements related to loan refinancings and restructurings for borrowers

experiencing financial difficulty.

The ASU also amends the guidance on vintage disclosures to require disclosure of gross write-offs

by year of origination.

The amendments are effective in periods beginning after December 15, 2022 using either a prospective or

modified retrospective transition.

Early adoption of certain or all of the amendments is permitted.

The Company is currently evaluating

the provisions of the amendments and the impact on its future consolidated financial statements.

Troubled Debt Restructurings and Vintage Disclosures,”

which updates the requirements for accounting for credit losses under Accounting Standards Codification 326, eliminates the accounting

guidance on troubled debt restructurings for creditors, and enhances creditors’ disclosure requirements related to loan

refinancings and restructurings for borrowers experiencing financial difficulty.

The ASU also amends the guidance on vintage disclosures

to require disclosure of gross write-offs by year of origination.

The amendments are effective in periods beginning after December

15, 2022 using either a prospective or modified retrospective transition.

Early adoption of certain or all of the amendments is

The Company is currently evaluating the provisions of the amendments and the impact on its future consolidated financial

June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326).” This ASU adds an impairment

model, known as the current expected credit loss (“CECL”) model, that is based on expected losses rather than incurred

Under this guidance, an entity recognizes as an allowance its estimate of expected credit losses, which the FASB believes

will result in more timely recognition of losses.

This ASU describes the impairment allowance as a valuation account that is deducted

from the amortized cost basis of the financial asset(s) to present the net carrying value at the amount expected to be collected

on the financial asset.

Credit losses relating to available-for-sale debt securities should be measured in a manner similar to

current GAAP;

however, the amendments in this update require that credit losses be presented as an allowance rather than as a

write-down, which will allow an entity the ability to record reversals of credit losses in current period net income.

15, 2019, the FASB issued ASU 2019-10, “Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic

815), and Leases (Topic 842):

Effective Dates,” which finalized various effective date delays for private companies, not-for-profit

organizations, and certain smaller reporting companies.

Under ASU 2019-10, the effective date for implementation of CECL for smaller

reporting companies was extended to fiscal years, and interim periods within those years, beginning after December 15, 2022.

Company is currently evaluating the new guidance but believes it is likely to incur more upfront losses on its portfolio under

the new CECL model.

March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848),” which provides optional guidance for

6 unchanged sentences

and (iii) sales or transfers of debt securities classified as held-to-maturity.

ASU 2020-04 is effective from March 12, 2020 through

December 31, 2022.

An entity may elect to adopt the amendments for contract modifications as of any date from the beginning of

an interim period that includes or is subsequent to March 12, 2020, or prospectively from a date within an interim period that

includes or is subsequent to March 12, 2020, up to the date that the financial statements are available to be issued.

may elect to apply the amendments in ASU 2020-04 to eligible hedging relationships existing as of the beginning of the interim

period that includes March 12, 2020 and to new eligible hedging relationships entered into after the beginning of the interim

period that includes March 12, 2020.

The one-time election to sell, transfer, or both sell and transfer debt securities classified

as held-to-maturity may be made at any time after March 12, 2020 but no later than December 31, 2022.

ASU 2020-04 was effective upon issuance, and the

provisions generally can be applied prospectively as of January 1, 2020 through December 31, 2024.

The Company has identified

3 unchanged sentences

standard will have a material impact on the Company’s consolidated financial statements.

June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326).” This standard adds an

impairment model, known as the current expected credit loss (“CECL”) model, that is based on expected losses rather

than incurred losses.

Under this guidance, an entity recognizes as an allowance its estimate of expected credit losses, which

the FASB believes will result in more timely recognition of losses.

This ASU describes the impairment allowance as a valuation

account that is deducted from the amortized cost basis of the financial asset(s) to present the net carrying value at the amount

expected to be collected on the financial asset.

Credit losses relating to available-for-sale debt securities should be measured

in a manner similar to current GAAP;

however, the amendments in this update require that credit losses be presented as an allowance

rather than as a write-down, which will allow an entity the ability to record reversals of credit losses in current period net

On November 15, 2019, the FASB issued ASU 2019-10, “Financial Instruments - Credit Losses (Topic 326), Derivatives

and Hedging (Topic 815), and Leases (Topic 842):

Effective Dates,” which finalized various effective date delays for private

companies, not-for-profit organizations, and certain smaller reporting companies.

Under ASU 2019-10, the effective date for implementation

of CECL for smaller reporting companies was extended to fiscal years, and interim periods within those years, beginning after

December 15, 2022.

The Company is currently evaluating the new guidance but believes it is likely to incur more upfront losses

on its portfolio under the new CECL model.

Net Income per

8 unchanged sentences

Three Months Ended

Six Months Ended

Weighted-average shares outstanding

3 unchanged sentences

Diluted net income per share

the three months ended March 31, 2022 and 2021, outstanding options to purchase shares of common stock and outstanding shares

of restricted stock in an aggregate of approximately 300,000 and 411,000 , respectively, have been excluded from the calculation

of diluted net income per share as such securities were anti-dilutive.

Finance Receivables, Net

the three months ended June 30, 2022 and 2021, outstanding options to purchase shares of common stock and outstanding shares of

restricted stock in an aggregate of approximately 308,000 and 391,000 , respectively, have been excluded from the calculation of

diluted net income per share, as such securities were anti-dilutive.

For the six months ended June 30, 2022 and 2021, outstanding

options to purchase shares of common stock and outstanding shares of restricted stock in an aggregate of approximately 309,000

and 401,000 , respectively, have been excluded from the calculation of diluted net income per share, as all such securities were

anti-dilutive.

Receivables, Net

receivables are reported at their determined principal balances net of any unearned income, cumulative charge-offs and unamortized

2 unchanged sentences

expected using the effective interest method.

of March 31, 2022 and December 31, 2021, the Company had a credit loss allowance of $8.4 million.

of June 30, 2022 and December 31, 2021, the Company had a credit loss allowance of $8.4 million.

Of the total $8.4 million, $ 1.2

4 unchanged sentences

that was recognized in order to reflect the Best royalty at its estimated fair value.

Approximately $23,000 of cash receipts received from the Companys

Besivance® royalty during the six months ended June 30, 2022 were applied toward the allowance for credit losses.

carrying values of finance receivables are as follows (in thousands):

Schedule of carrying value of finance receivables

June 30, 2022

December 31, 2021

Royalty purchases

4 unchanged sentences

Schedule of analysis of nonaccrual and performing loans by portfolio segment

March 31, 2022

June 30, 2022

December 31, 2021

Royalty purchases, net of credit loss

Royalty purchases, net of credit loss allowance

Total carrying value

of March 31, 2022, the Company had two finance receivables in nonaccrual status:

(1) the term loan to Flowonix Medical, Inc.

(“Flowonix”),

with a net carrying value of $9.8 million and (2) the Best royalty, with a net carrying value of $3.2 million.

in nonaccrual status, the Flowonix term loan was not considered impaired as of March 31, 2022 and December 31, 2021.

collected $0.5 million on its nonaccrual finance receivables during the three months ended March 31, 2022.

Marketable Investments

in available-for-sale corporate debt securities and equity securities as of March 31, 2022 and December 31, 2021 consist of the

of June 30, 2022, the Company had two finance receivables in nonaccrual status:

(1) the term loan to Flowonix

Medical, Inc.

(“Flowonix”), with a net carrying value of $ 9.8

million and (2) the Best royalty, with a net carrying value of $ 3.1 million .

Although in nonaccrual status, the Flowonix term loan was not considered impaired as of June 30, 2022 and December

The Company collected $0.6 million on its nonaccrual finance receivables during the six months ended June 30,

in available-for-sale corporate debt securities and equity securities as of June 30, 2022 and December 31, 2021 consist of the

following (in thousands):

Schedule of marketable investments

June 30, 2022

December 31, 2021

Corporate debt securities

2 unchanged sentences

amortized cost basis amounts, gross unrealized holding gains, gross unrealized holding losses and fair values of available-for-sale

corporate debt securities as of March 31, 2022 and December 31, 2021, are as follows (in thousands):

Schedule of available-for-sale securities reconciliation

March 31, 2022

corporate debt securities as of June 30, 2022 and December 31, 2021, are as follows (in thousands):

Schedule of marketable investments

June 30, 2022

December 31, 2021

following table presents unrealized net income (loss) on equity securities during the three months ended March 31, 2022 and 2021

following table presents unrealized net (loss) gain on equity securities during the three and six months ended June 30, 2022 and

2021 (in thousands):

1 unchanged sentence

Three Months Ended

Six Months Ended June 30,

Unrealized net (loss) gain on equity securities reflected in the unaudited condensed consolidated statements of income

1 unchanged sentence

following table summarizes the gross book value, accumulated amortization and net book value balances of intangible assets as

of March 31, 2022 and December 31, 2021 (in thousands):

of June 30, 2022 and December 31, 2021 (in thousands):

Schedule of Intangible Assets

March 31, 2022

June 30, 2022

December 31, 2021

3 unchanged sentences

Total intangible assets

(1) Prior to the acquisition,

Enteris entered into a non-exclusive commercial license agreement (the “License Agreement”) with Cara Therapeutics,

(“Cara”), for oral formulation rights to Enteris’ Peptelligence® technology to develop and commercialize

Oral KORSUVA TM in any indication worldwide, excluding South Korea and Japan.

Cara is obligated to pay Enteris certain

development, regulatory and tiered commercial milestone payments, as well as low single-digit royalties based on net sales in

the licensed territory.

expense related to intangible assets was $0.5 million and $1.6 million for the three months ended March 31, 2022 and 2021, respectively.

estimated future amortization expense related to intangible assets as of March 31, 2022 is as follows (in thousands):

(1) Prior to the acquisition, Enteris entered into a non-exclusive

commercial license agreement (the “License Agreement”) with Cara Therapeutics, Inc.

(“Cara”), for oral formulation

rights to Enteris’ Peptelligence® technology to develop and commercialize Oral KORSUVA TM in any indication worldwide,

excluding South Korea and Japan.

Cara is obligated to pay Enteris certain development, regulatory and tiered commercial milestone payments,

as well as low single-digit royalties based on net sales in the licensed territory.

expense related to intangible assets was $ 0.4 million and $ 0.7 million for the three months ended June 30, 2022 and 2021, respectively.

Amortization expense related to intangible assets was $ 0.9 million and $ 2.3 million for the six months ended June 30, 2022 and

2021, respectively.

estimated future amortization expense related to intangible assets as of June 30, 2022 is as follows (in thousands):

Schedule of Intangible Asset Amortization Expense

Remainder of 2022

Commitments and Contingencies

and Contingencies

Consideration

Company recorded contingent consideration related to the August 2019 acquisition of Enteris and sharing of certain milestone and

royalties due to Enteris pursuant to the License Agreement.

Contingent consideration is remeasured to fair value at each reporting

date until the contingency is resolved, with changes in the estimated fair value recognized in earnings.

The estimated fair value

of contingent consideration as of March 31, 2022 and December 31, 2021 was $8.5 million.

The Company did not recognize a

change in the estimated fair value of its contingent consideration during the three months ended March 31, 2022 and 2021.

of March 31, 2022, the Company’s unfunded commitments were as follows (in millions):

Company recorded contingent consideration related to the 2019 acquisition of Enteris and sharing of certain milestone and royalties

due to Enteris pursuant to the License Agreement.

Contingent consideration is remeasured to fair value at each reporting date

until the contingency is resolved, with changes in the estimated fair value recognized in earnings.

The estimated fair value of

contingent consideration as of June 30, 2022 and December 31, 2021 was $ 8.5 million .

The Company did not recognize a change

in the estimated fair value of its contingent consideration during the six months ended June 30, 2022.

The Company recognized

a $0.1 million gain on the change in fair value of its contingent consideration during the six months ended June 30, 2021.

of June 30, 2022, the Company’s unfunded commitments were as follows (in millions):

Schedule of Unfunded Commitments

Trio Healthcare Ltd.

Ideal Implant, Inc.

Total unfunded commitments

2 unchanged sentences

subject to being advanced as long as an event of default does not exist.

Fair Value Measurements

Value Measurements

Company measures and reports certain financial and non-financial assets and liabilities on a fair value basis.

21 unchanged sentences

into or out of any hierarchy level are recognized at the end of the reporting period in which the transfers occurred.

no transfers between any levels during the three months ended March 31, 2022.

no transfers between any levels during the six months ended June 30, 2022.

following information is provided to help readers gain an understanding of the relationship between amounts reported in the accompanying

14 unchanged sentences

Consideration

Company recorded contingent consideration related to the August 2019 acquisition of Enteris and sharing of certain milestone and

royalties due to Enteris pursuant to the License Agreement.

Company recorded contingent consideration related to the 2019 acquisition of Enteris and sharing of certain milestone and royalties

due to Enteris pursuant to the License Agreement.

fair value measurements of contingent consideration obligations arising from business combinations are classified as Level 3 estimates

25 unchanged sentences

non-exchange traded derivatives, fair value is based on option pricing models and are classified as Level 3.

following table presents financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2022 (in

following table presents financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2022 (in

Schedule of fair value assets measured on recurring basis

15 unchanged sentences

Contingent consideration payable

changes in fair value of the warrant assets during the three months ended March 31, 2022 and 2021 were as follows (in thousands):

changes in fair value of the warrant assets during the six months ended June 30, 2022 and 2021 were as follows (in thousands):

Schedule of fair value assets measured on recurring basis unobservable input reconciliation

March 31, 2022

March 31, 2021

Fair value – Fair value - December 31, 2021

June 30, 2022

June 30, 2021

Fair value - December 31, 2021

Fair value - December 31, 2020

Change in fair value

Fair value - March 31, 2022

Fair value - March 31, 2021

Fair value - June 30, 2022

Fair value - June 30, 2021

Company holds warrants issued to the Company in conjunction with certain term loan investments.

6 unchanged sentences

Schedule of weighted average assumptions

June 30, 2022

December 31, 2021

Dividend rate range

Risk-free rate range

Expected life (years)

2.9 % to 3.0 %

0.97 % to 1.44 %

Expected life (years) range

Expected volatility range

of March 31, 2022 and December 31, 2021, the Company had two royalties, Best and Cambia®, that were deemed to be impaired

based on reductions in carrying values in prior periods.

The following table presents these royalties measured at fair value on

a nonrecurring basis as of March 31, 2022 and December 31, 2021 (in thousands):

52.6 % to 147.5 %

60.2 % to 142.0 %

of June 30, 2022 and December 31, 2021, the Company had two royalties, Best and Cambia®, that were deemed to be impaired based

on reductions in carrying values in prior periods.

The following table presents these royalties measured at fair value on a nonrecurring

basis as of June 30, 2022 and December 31, 2021 (in thousands):

Schedule of fair value

2 unchanged sentences

or Liabilities

March 31, 2022

June 30, 2022

December 31, 2021

were no liabilities measured at fair value on a nonrecurring basis as of March 31, 2022 and December 31, 2021.

were no liabilities measured at fair value on a nonrecurring basis as of June 30, 2022 and December 31, 2021.

following information is provided to help readers gain an understanding of the relationship between amounts reported in the accompanying

3 unchanged sentences

Schedule of fair value by balance sheet grouping

of March 31, 2022 (in thousands):

of June 30, 2022 (in thousands):

Carrying Value

Financial Assets

6 unchanged sentences

of December 31, 2021 (in thousands):

Carrying Value

Financial Assets

10 unchanged sentences

Finance Receivables segment does not have any revenues received from contracts with customers.

following table provides the contract revenue recognized by revenue source for the three months ended March 31, 2022 and 2021

following table provides the contract revenue recognized by revenue source for the three and six months ended June 30, 2022 and

2021 (in thousands):

1 unchanged sentence

Three Months Ended

Six Months Ended

Pharmaceutical Development Segment

10 unchanged sentences

Total contract liabilities

the three months ended March 31, 2022, the Company recognized $ 0.1 million of 2021 deferred revenue from satisfaction of

performance obligations.

The Company did not have any contract assets nor did it have any contract liabilities related to the

License Agreement as of March 31, 2022 or December 31, 2021.

the six months ended June 30, 2022, the Company recognized $ 0.1

million of 2021 deferred revenue from satisfaction of performance obligations.

The Company did not have any contract assets

nor did it have any contract liabilities related to the License Agreement as of June 30, 2022 or December 31, 2021.

Segment Information

4 unchanged sentences

Consequently,

the segments are evident from the structure of the Company’s internal organization, focusing on financial information that

the Company’s chief executive officer uses to make decisions about the Company’s operating matters.

the segments are evident from the structure of the Company’s internal organization, focusing on financial information that the

Company’s chief executive officer uses to make decisions about the Company’s operating matters.

described in Note 1, the Company has determined it has two reportable segments:

3 unchanged sentences

offered within each segment.

The Company does not report assets by reportable segment, as this metric is not used by the Company’s

chief executive officer in assessing performance or allocating resources to the segments.

following table presents financial information for the Company’s reportable revenue by geographic region for the periods

indicated (in thousands):

Schedule of Reportable Revenue by

Geographic Region

Three Months Ended

United States , country of domicile

International

Total revenue

The Company does not report assets by reportable segment, nor does the Company report results by

geographic region, as these metrics are not used by the Company’s chief executive officer in assessing performance or allocating

resources to the segments.

performance is evaluated based on several factors, including income (loss) from continuing operations before income taxes.

uses this measure of net income (loss) to evaluate segment performance because the Company believes this measure is indicative of

performance trends and the overall earnings potential of each segment.

uses this measure of net income (loss) to evaluate segment performance because the Company believes this measure is indicative of performance

trends and the overall earnings potential of each segment.

following tables present financial information for the Company’s reportable segments for the periods indicated (in thousands):

Schedule of Reportable Segments

Three Months Ended March 31, 2022

Three Months Ended June 30, 2022

Pharmaceutical

1 unchanged sentence

Holding Company

Interest expense

Manufacturing, research and development

Depreciation and amortization expense

General and administrative

Other expense, net

Income tax expense

Net income (loss)

Three Months Ended June 30, 2021

Pharmaceutical

Development and

Holding Company

Interest expense

Manufacturing, research and development

Depreciation and amortization expense

Change in fair value of acquisition-related contingent consideration

General and administrative

Other income, net

Income tax expense

Net income (loss)

Six Months Ended June 30, 2022

Pharmaceutical

Development and

Holding Company

Other revenue

6 unchanged sentences

Net income (loss)

Three Months Ended March 31, 2021

Six Months Ended June 30, 2021

Pharmaceutical

5 unchanged sentences

Depreciation and amortization expense

Change in fair value of acquisition-related contingent consideration

General and administrative

2 unchanged sentences

Net income (loss)

in Holding Company and Other are the expenses of the parent holding company and certain other enterprise-wide overhead costs,

including public company costs and non-Enteris corporate employees, which have been included for purposes of reconciling to the

consolidated amounts.

in Holding Company and Other are the expenses of the parent holding company and certain other enterprise-wide overhead costs, including

public company costs and non-Enteris corporate employees, which have been included for purposes of reconciling to the consolidated amounts.

Subsequent Events

July 1, 2022, SWK Funding, a subsidiary of the Company, entered into a credit agreement pursuant to which SWK Funding provided to Exeevo,

(“Exeevo”) a term loan in the amount of $ 7.5 million .

SWK Funding funded $ 5.0 million at closing with the remaining $ 2.5

million becoming available upon Exeevo’s satisfaction of certain future conditions.

The loan matures on July 1, 2027 .

In connection with

the loan, SWK Funding also received a warrant to purchase 930 shares of Exeevo common stock.

July 1, 2022, SWK Funding received $ 4.3 million for the payoff of the Beleodaq® royalty.

Trio Healthcare

Ltd., (Ostomy Products Royalty)

July 25, 2022, SWK Funding received $ 6.1 million for the payoff of the Ostomy Products Royalty.

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-Q

Item 1. Financial Statements