TherapeuticsMD, Inc. 10-K

Item 9A. Controls and procedures Evaluation of disclosure controls and procedures Our management evaluated the effectiveness of our disclosure controls and procedures (as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) or 15d-15(e)) as of the end of the period covered by this 2024 10-K Report. Based on that evaluation, our Principal Executive Officer and Principal Financial and Accounting Officer concluded that, as of December 31, 2024, our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is (i) recorded, processed, summarized, and reported within the time periods specified in the SEC rules and forms, and (ii) is accumulated and communicated to our management, including our Principal Executive Officer and Principal Financial and Accounting Officer, as appropriate to allow timely decisions regarding required disclosure. Changes in internal control over financial reporting There was no change in our internal control over financial reporting during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Inherent limitations on effectiveness of controls Our management does not expect that our disclosure controls and procedures or our internal controls will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefit of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, misstatements, errors, and instances of fraud, if any, within our company have been or will be prevented or detected. Further, internal controls may become inadequate because of changes in conditions, or through the deterioration of the degree of compliance with policies or procedures. Management’s report on internal control over financial reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined under Exchange Act Rules 13a-15(f) and 15d-15(f). Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP. Internal control over financial reporting includes those policies and procedures that: ● pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets; ● provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and ● provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements. Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2024. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control — Integrated Framework (2013). Management’s assessment included an evaluation of the design of our internal control over financial reporting and testing of the operational effectiveness of its internal control over financial reporting. Based on management’s assessment, we believe that our internal controls over financial reporting were effective as of December 31, 2024. This 2024 10-K Report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to the rules of the SEC that permit the Company to provide only management’s report in this 2024 10-K Report. Item 9B. Other information None . Item 9C. Disclosure regarding foreign jurisdictions that prevent inspections None. 50 PART III Item 10. Directors, executive officers, and corporate governance This information will be contained in our definitive proxy statement for our 2025 Annual Meeting of Stockholders, to be filed with the SEC not later than 120 days after the end of our fiscal year covered by this report, and incorporated herein by reference or, alternatively, by amendment to this Form 10-K under cover of Form 10-K/A no later than the end of such 120 day period. Item 11. Executive compensation This information will be contained in our definitive proxy statement for our 2025 Annual Meeting of Stockholders, to be filed with the SEC not later than 120 days after the end of our fiscal year covered by this report, and incorporated herein by reference or, alternatively, by amendment to this Form 10-K under cover of Form 10-K/A no later than the end of such 120 day period. Item 12. Security ownership of certain beneficial owners and management and related stockholder matters This information will be contained in our definitive proxy statement for our 2025 Annual Meeting of Stockholders, to be filed with the SEC not later than 120 days after the end of our fiscal year covered by this report, and incorporated herein by reference or, alternatively, by amendment to this Form 10-K under cover of Form 10-K/A no later than the end of such 120 day period. Item 13. Certain relationships and related transactions, and director independence This information will be contained in our definitive proxy statement for our 2025 Annual Meeting of Stockholders, to be filed with the SEC not later than 120 days after the end of our fiscal year covered by this report, and incorporated herein by reference or, alternatively, by amendment to this Form 10-K under cover of Form 10-K/A no later than the end of such 120 day period. Item 14. Principal accountant fees and services This information will be contained in our definitive proxy statement for our 2025 Annual Meeting of Stockholders, to be filed with the SEC not later than 120 days after the end of our fiscal year covered by this report, and incorporated herein by reference or, alternatively, by amendment to this Form 10-K under cover of Form 10-K/A no later than the end of such 120 day period. 51 PART IV Item 15. Exhibits and financial statement schedules (a) Financial statements and financial statements schedules (1) Financial Statements are listed in the Index to Financial Statements on page F-1 of this 2024 10-K Report. (2) No financial statement schedules are included because such schedules are not applicable, are not required, or because required information is included in the consolidated financial statements or notes thereto. (b) Exhibits Exhibit No. Description 2.1 Agreement and Plan of Reorganization, dated July 6, 2009, among Croff Enterprises, Inc., AMHN Acquisition Corp., America’s Minority Health Network, Inc., and the Major Shareholders(1) 2.2 Agreement and Plan of Reorganization, dated June 11, 2010, among AMHN, Inc., SHN Acquisition Corp., Spectrum Health Network, Inc., and the Sole Shareholder of Spectrum Health Network, Inc.(2) 2.3 Croff Enterprises, Inc. Plan of Corporate Division and Reorganization, dated October 25, 2007 (3) 2.4 Agreement and Plan of Merger, dated July 18, 2011, among vitaMedMD, LLC, AMHN, Inc., and vitaMed Acquisition, LLC(4) 2.5***+ Stock Purchase Agreement, dated March 6, 2022, by and between TherapeuticsMD, Inc. and GoodRx, Inc. (5) 3.1 Articles of Conversion of AMHN, Inc. filed in the State of Nevada, dated July 20, 2010 (6) 3.2 Articles of Incorporation of AMHN, Inc. filed in the State of Nevada, dated July 20, 2010 (6) 3.3 Composite Amended and Restated Articles of Incorporation of the Company, as amended (7) 3.4 Bylaws of the AMHN, Inc. (8) 3.5 First Amendment to Bylaws of the Company, dated December 17, 2015 (9) 3.6 Second Amendment to Bylaws of the Company, adopted May 27, 2022 (10) 3.7 Third Amendment to Bylaws of the Company, dated July 29, 2022 (11) 3.8 Certificate of Change to Articles of Incorporation of the Company (12) 3.9 Certificate of Designation, Preferences and Rights of Series A Preferred Stock (11) 3.10 Fourth Amendment to Bylaws of the Company, dated June 29, 2023 (13) 4.1 Form of Certificate of Common Stock (14) 4.2 Description of Securities of the Company (15) 10.1 Form of Common Stock Purchase Warrant (16) 10.2* Form of Non-Qualified Stock Option Agreement (16) 10.3* TherapeuticsMD, Inc. 2019 Stock Incentive Plan (17) 10.4* First Amendment to the TherapeuticsMD, Inc. 2019 Stock Incentive Plan (18) 10.5* Amended and Restated 2012 Stock Incentive Plan (19) 10.6* 2009 Long Term Incentive Compensation Plan, as amended (20) 10.7* TherapeuticsMD, Inc. 2020 Employee Stock Purchase Plan (21) 10.8 Form of Common Stock Purchase Warrant, dated February 24, 2012 (22) 10.9 Common Stock Purchase Warrant, issued to Plato & Associates, LLC, dated January 31, 2013 (23) 10.10 Form of Warrant to Purchase Common Stock, dated August 5, 2020 (24) 10.11 Amendment to Company Warrant issued by the Company to the Subscribers party to that certain Subscription Agreement, dated as of August 5, 2020, dated November 8, 2020 (25) 52 10.12 Second Amendment to Company Warrant issued by the Company to the Subscribers party to that certain Subscription Agreement, dated as of August 5, 2020 (26) 10.13 Warrant issued by the Company to Robert Finizio (26) 10.14 Amendment to Warrant issued by the Company to Robert Finizio (26) 10.15* Warrant issued by the Company to John C.K. Milligan, IV (26) 10.16* Amendment to Warrant issued by the Company to John C.K. Milligan, IV (26) 10.17 Subscription Agreement, dated August 5, 2020, by and among TherapeuticsMD, Inc. and the Subscribers identified on the Schedule of Subscribers attached thereto (24) 10.18*** License Agreement, dated July 30, 2018, by and between TherapeuticsMD, Inc. and The Population Council, Inc. (27) 10.19*** Lease, dated October 5, 2018, by and between 951 Yamato Acquisition Company, LLC and TherapeuticsMD, Inc. (28) 10.20*** License and Supply Agreement, dated June 6, 2019, by and between TherapeuticsMD, Inc. and Theramex HQ UK Limited (29) 10.21* Form of Indemnification Agreement between TherapeuticsMD, Inc. and each of its executive officers and directors (25) 10.22* 2022 Executive Retention and Performance Bonus Plan. (ERB-Plan) (30) 10.23 Subscription Agreement between TherapeuticsMD, Inc. and Rubric Capital Management LP, dated July 29, 2022 (11) 10.24 Subscription Agreement by and among TherapeuticsMD, Inc., Sixth Street Specialty Lending, Inc., TOP IV Talents, LLC and TOA Talents, LLC, dated July 29, 2022 (11) 10.25 Subscription Agreement between TherapeuticsMD, Inc. and Rubric Capital Management LP, dated September 30, 2022 (31) 10.26 Subscription Agreement by and among TherapeuticsMD, Inc., Sixth Street Specialty Lending, Inc., TOP IV Talents, LLC and TAO Talents, LLC, dated September 30, 2022 (31) 10.27 Subscription Agreement between TherapeuticsMD, Inc. and Rubric Capital Management LP, dated October 28, 2022 (32) 10.28 Subscription Agreement by and among TherapeuticsMD, Inc., Sixth Street Specialty Lending, Inc., TOP IV Talents, LLC and TAO Talents, LLC, dated October 28, 2022 (32) 10.29***+ License Agreement by and between TherapeuticsMD, Inc. and Mayne Pharma LLC, dated December 4, 2022 (33) 10.30***+ Transaction Agreement by and between TherapeuticsMD, Inc. and Mayne Pharma LLC, dated December 4, 2022 (33) 10.31** Amendment No. 1 to the License Agreement between TherapeuticsMD, Inc. and Mayne Pharma LLC, dated as of December 30, 2022 (15) 10.32 Amendment No. 1 to the Transaction Agreement between TherapeuticsMD, Inc. and Mayne Pharma LLC, dated as of December 30, 2022 (15) 10.33* Amended and Restated Employment Agreement, dated as of December 18, 2018, by and between TherapeuticsMD, Inc. and Marlan Walker (15) 10.34* Amendment, effective October 15, 2021, to the Employment Agreement, dated as of December 18, 2018, by and between TherapeuticsMD, Inc. and Marlan Walker (15) 10.35* Amendment, dated February 21, 2023, to the Employment Agreement, dated as of December 18, 2018, as extended effective October 15, 2021, by and between TherapeuticsMD, Inc. and Marlan Walker (34) 10.36*† Amendment, dated December 17, 2024, to the Employment Agreement, dated as of December 18, 2018, as extended effective February 21, 2023, by and between TherapeuticsMD, Inc. and Marlan Walker 10.37* General Consulting and Services Agreement by and between TherapeuticsMD, Inc. and MCD Consulting Management Services, LLC, dated February 21, 2023 (34) 10.38 Subscription Agreement, dated May 1, 2023, between TherapeuticsMD, Inc. and Rubric Capital Management LP (35) 10.39* Master Services Agreement, dated August 15, 2023, between TherapeuticsMD, Inc. and JZ Advisory Group (36) 53 19† Insider Trading Policy 21.1† Subsidiaries of the Company 23.1† Consent of Berkowitz Pollack Brant 31.1† Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) 31.2† Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) 32.1†† Section 1350 Certification of Chief Executive Officer 32.2†† Section 1350 Certification of Chief Financial Officer 97.1 TherapeuticsMD, Inc. Policy on Recoupment of Incentive Compensation (37) 101† Inline XBRL Document Set for the consolidated financial statements and accompanying notes in Part IV, Item 15(a), “Financial Statements and Financial Statements Schedules” of this Annual Report on Form 10-K 104† Inline XBRL for the cover page of this Annual Report on Form 10-K, included in the Exhibit 101 Inline XBRL Document Set * Indicates a contract with management or compensatory plan or arrangement. ** Certain confidential material contained in the document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been granted with respect to this omitted information. *** Portions of this exhibit have been redacted in compliance with Regulation S-K Item 601(b)(2). The omitted information is not material and would likely cause competitive harm to the Company if publicly disclosed. + Certain of the exhibits and schedules to this exhibit have been omitted in accordance with Item 601(a)(5) of Regulation S-K. The Company agrees to furnish a copy of all omitted exhibits and schedules to the SEC upon its request. † Filed herewith. †† Furnished herewith. (1) Filed as an exhibit to Form 8-K filed with the Commission on July 10, 2009 and incorporated herein by reference (SEC File No. 000-16731). (2) Filed as an exhibit to Form 8-K filed with the Commission on June 14, 2010 and incorporated herein by reference (SEC File No. 000-16731). (3) Filed as an exhibit to Form 10-K for the year ended December 31, 2007 filed with the Commission on May 1, 2008 and incorporated herein by reference (SEC File No. 000-16731). (4) Filed as an exhibit to Form 8-K filed with the Commission on July 21, 2011 and incorporated herein by reference (SEC File No. 000-16731). (5) Filed as an exhibit to Form 8-K filed with the Commission on March 10, 2022 and incorporated herein by reference (SEC File No. 001-00100). (6) Filed as an exhibit to Form 10-Q for the quarter ended June 30, 2010 filed with the Commission on August 3, 2010 and incorporated herein by reference (SEC File No. 000-16731). (7) Filed as an exhibit to Form 10-Q for the quarter ended June 30, 2023 filed with the Commission on August 14, 2023 and incorporated herein by reference (SEC File No. 001-00100). (8) Filed as an exhibit to Definitive 14C Information Statement filed with the Commission on June 29, 2010 and incorporated herein by reference (SEC File No. 000-16731). (9) Filed as an exhibit to Form 8-K filed with the Commission on December 22, 2015 and incorporated herein by reference (SEC File No. 001-00100). (10) Filed as an exhibit to Form 8-K filed with the Commission on June 3, 2022 and incorporated herein by reference (SEC File No. 001-00100). 54 (11) Filed as an exhibit to Form 8-K filed with the Commission on August 1, 2022 and incorporated herein by reference (SEC File No. 001-00100). (12) Filed as an exhibit to Form 8-K filed with the Commission on May 9, 2022 and incorporated herein by reference (SEC File No. 001-00100). (13) Filed as an exhibit to Form 8-K filed with the Commission on July 6, 2023 and incorporated herein by reference (SEC File No. 001-00100). (14) Filed as an exhibit to Form S-3 filed with the Commission on January 25, 2013 and incorporated hereby by reference (SEC File No. 333-186189). (15) Filed as an exhibit to Form 10-K for the year ended December 31, 2022 filed with the Commission on April 7, 2023 and incorporated herein by reference (SEC File No. 001-00100). (16) Filed as an exhibit to Form 8-K filed with the Commission on October 11, 2011 and incorporated herein by reference (SEC File No. 000-16731). (17) Filed as an exhibit to Form S-8 filed with the Commission on June 21, 2019 and incorporated herein by reference (SEC File No. 333-232268). (18) Filed as an appendix to the Definitive Proxy Statement filed with the Commission on April 14, 2021 and incorporated herein by reference (SEC File No. 001-00100). (19) Filed as an exhibit to Form 8-K filed with the Commission on August 22, 2013 and incorporated herein by reference (SEC File No. 001-00100). (20) Filed as an exhibit to Registration Statement on Form S-8 filed with the Commission on October 15, 2013 and incorporated herein by reference (SEC File No. 333-191730). (21) Filed as an appendix to the Definitive Proxy Statement filed with the Commission on May 4, 2020 and incorporated herein by reference (SEC File No. 001-00100). (22) Filed as an exhibit to Form 8-K filed with the Commission on February 24, 2012 and incorporated herein by reference (SEC File No. 000-16731). (23) Filed as an exhibit to Form 8-K filed with the Commission on February 6, 2013 and incorporated herein by reference (SEC File No. 000-16731). (24) Filed as an exhibit to Form 10-Q for the quarter ended June 30, 2020 filed with the Commission on August 7, 2020 and incorporated herein by reference (SEC File No. 001-00100). (25) Filed as an exhibit to Form 10-Q filed with the Commission on November 9, 2020 and incorporated herein by reference (SEC File No. 001-00100). (26) Filed as an exhibit to Form 10-K for the year ended December 31, 2020 filed with the Commission on March 4, 2021 and incorporated herein by reference (SEC File No. 001-00100). (27) Filed as an exhibit to Form 10-Q for the quarter ended September 30, 2018 filed with the Commission on November 8, 2018 and incorporated herein by reference (SEC File No. 001-00100). (28) Filed as an exhibit to Form 10-Q for the quarter ended September 30, 2019 filed with the Commission on November 8, 2019 and incorporated herein by reference (SEC File No. 001-00100). (29) Filed as an exhibit to Form 10-Q for the quarter ended June 30, 2019 filed with the Commission on August 9, 2019 and incorporated herein by reference (SEC File No. 001-00100). 55 (30) Filed as an exhibit to Form 10-K for the year ended December 31, 2021, filed with the Commission on March 23, 2022 and incorporated herein by reference (SEC File No. 001-00100). (31) Filed as an exhibit to Form 8-K filed with the Commission on October 3, 2022 and incorporated herein by reference (SEC File No. 001-00100). (32) Filed as an exhibit to Form 8-K filed with the Commission on October 31, 2022 and incorporated herein by reference (SEC File No. 001-00100). (33) Filed as an exhibit to Form 8-K filed with the Commission on December 5, 2022 and incorporated herein by reference (SEC File No. 001-00100). (34) Filed as an exhibit to Form 8-K filed with the Commission on February 27, 2023 and incorporated herein by reference (SEC SEC File No. 001-00100). (35) Filed as an appendix to the Definitive Proxy Statement filed with the Commission on May 17, 2023 and incorporated herein by reference (SEC File No. 001-00100). (36) Filed as an exhibit to Form 10-Q for the quarter ended September 30, 2023, filed with the Commission on November 14, 2023 and incorporated herein by reference (SEC File No. 001-00100). (37) Filed as an exhibit to Form 10-K for the year ended December 31, 2023 filed with the Commission on March 29, 2024 and incorporated herein by reference (SEC File No. 001-00100). Item 16. Form 10-K summary None. 56 Signatures Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this 2024 10-K Report to be signed on its behalf by the undersigned, thereunto duly authorized, on March 27, 2025. THERAPEUTICSMD, INC. /s/ Marlan D. Walker Marlan D. Walker Chief Executive Officer Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this 2024 10-K Report to be signed on its behalf by the undersigned, thereunto duly authorized, on March 27, 2025. Signature Title /s/ Marlan D. Walker Chief Executive Officer Marlan D. Walker (Principal Executive Officer) /s/ Joseph Ziegler Principal Financial and Accounting Officer Joseph Ziegler /s/ Tommy G. Thompson Chairman Tommy G. Thompson /s/ Cooper C. Collins Director Cooper C. Collins /s/ Gail K. Naughton, Ph.D. Director Gail K. Naughton, Ph.D. /s/ Justin Roberts Director Justin Roberts 57 INDEX TO FINANCIAL STATEMENTS Page Report of Independent Registered Public Accounting Firm (PCAOB ID Number 52 ) F-2 Consolidated Balance Sheets F-4 Consolidated Statements of Operations F-5 Consolidated Statements of Stockholders’ Equity F-6 Consolidated Statements of Cash Flows F-7 Notes to Consolidated Financial Statements F-8 F- 1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders of TherapeuticsMD, Inc. and Subsidiaries Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of TherapeuticsMD, Inc. and Subsidiaries (the “Company”) as of December 31, 2024 and 2023, and the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the years in the two-year period ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America. Substantial Doubt about the Company’s Ability to Continue as a Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the recent change in operations and negative cash flow position along with other conditions as set forth in Note 1, raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provides a reasonable basis for our opinion. F- 2 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: (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. Acquisition of Net Working Capital As described further in Note 1 to the consolidated financial statements, the Company determined the acquisition of net working capital by Mayne Pharma, LLC in accordance with the Transaction Agreement. The Transaction Agreement included significant estimates, which are subject to change for a period of up to two years. The Company received financial claims from Mayne Pharma, LLC related to this agreement for amounts owed under the provisions of the Transaction Agreement related to distributor fees, rebates and returns of licensed products. The Company does not believe these claims are substantiated and thus, did not record an amount due to the licensee as of December 31, 2024. We identified the acquisition of net working capital as a critical audit matter. The principal consideration for our determination that the acquisition of net working capital pursuant to the provisions of the Transaction Agreement as a critical audit matter is due to the significant estimates and judgements required by management when determining the inputs and assumptions utilized in the development of the initial net working capital calculation included in the Transaction Agreement. The subjectivity of the estimates increases the level of estimation uncertainty, auditor judgement and level of effort required to evaluate management’s evidence supporting the projected final net working capital acquisition amount as it relates to the allowance for returns, rebates and distributor fees, including assumptions that no further liability will be incurred. Our audit procedures performed to address the critical matter included, among others: ● Review the letter sent to the licensee in response to financial claims. ● Review original Transaction Agreement and subsequent amendments. ● Review the rebates and returns analysis performed by the Company, assess method utilized, calculation, and conclusion reached for reasonableness. /s/ Berkowitz Pollack Brant, Advisors + CPAs We have served as the Company’s auditor since 2023. West Palm Beach, FL March 27, 2025 F- 3 TherapeuticsMD, Inc. and Subsidiaries Consolidated Balance Sheets (In thousands, except per share amounts) As of December 31, 2024 2023 Assets: Current assets: Cash and cash equivalents $ 5,059 $ 4,327 Royalty receivable, current portion 3,562 3,090 Prepaid and other current assets 3,638 4,035 Current assets of discontinued operations — 344 Total current assets 12,259 11,796 License rights and other intangible assets, net 4,321 6,098 Right of use assets, net 6,102 6,873 Royalty receivable, long term 16,010 18,484 Other non-current assets 130 58 Total assets $ 38,822 $ 43,309 Liabilities and stockholders’ equity: Current liabilities: Accounts payable $ 258 $ 27 Accrued expenses and other current liabilities 2,127 3,133 Current liabilities of discontinued operations 2,781 3,694 Total current liabilities 5,166 6,854 Operating lease liabilities 5,542 6,532 Other non-current liabilities 744 636 Total liabilities 11,452 14,022 Commitments and contingencies (Note 7) Stockholders’ equity: Common stock, par value $ 0.001 ; 32,000 and 12,000 shares authorized, 11,532 and 11,532 issued and outstanding as of December 31, 2024 and December 31, 2023, respectively 11 11 Additional paid-in capital 979,181 978,917 Accumulated deficit ( 951,822 ) ( 949,641 ) Total stockholders’ equity 27,370 29,287 Total liabilities and stockholders’ equity $ 38,822 $ 43,309 The accompanying notes are an integral part of these consolidated financial statements. F- 4 TherapeuticsMD, Inc. and Subsidiaries Consolidated Statements of Operations (In thousands, except per share amounts) Years ended December 31, 2024 2023 Revenue, net: License and service revenue $ 1,761 $ 1,302 Operating expenses: Selling, general and administrative 4,744 8,903 Impairment of long-lived assets (Note 4) 1,268 — Depreciation & amortization 509 922 Total operating expenses 6,521 9,825 Loss from operations ( 4,760 ) ( 8,523 ) Other income (expense): Miscellaneous income 2,417 781 Total other income 2,417 781 Loss from continuing operations before income taxes ( 2,343 ) ( 7,742 ) Benefit for income taxes 31 43 Net loss from continuing operations ( 2,312 ) ( 7,699 ) Income (loss) from discontinued operations, net of income taxes 131 ( 2,579 ) Net loss $ ( 2,181 ) $ ( 10,278 ) Loss per common share, basic: Continuing operations ( 0.20 ) ( 0.74 ) Discontinued operations, net 0.01 ( 0.25 ) Net loss per common share, basic $ ( 0.19 ) $ ( 0.99 ) Loss per common share, diluted: Continuing operations ( 0.20 ) ( 0.74 ) Discontinued operations, net 0.01 ( 0.25 ) Net loss per common share, diluted $ ( 0.19 ) $ ( 0.99 ) Weighted average common shares, basic 11,532 10,441 Weighted average common shares, diluted 11,532 10,441 The accompanying notes are an integral part of these consolidated financial statements. F- 5 TherapeuticsMD, Inc. and Subsidiaries Consolidated Statements of Stockholders’ Equity (In thousands) Common Stock Additional Paid in Accumulated Shares Amount Capital Deficit Total Balance, December 31, 2022 9,498 $ 9 $ 974,497 $ ( 939,363 ) $ 35,143 Shares issued for vested restricted stock units 844 1 — — 1 Share-based compensation — — 1,271 — 1,271 Shares issued for sale of common stock related to private placement sale 1,190 1 3,149 — 3,150 Net loss — — — ( 10,278 ) ( 10,278 ) Balance, December 31, 2023 11,532 11 978,917 ( 949,641 ) 29,287 Share-based compensation — — 264 — 264 Net loss — — — ( 2,181 ) ( 2,181 ) Balance, December 31, 2024 11,532 $ 11 $ 979,181 $ ( 951,822 ) $ 27,370 The accompanying notes are an integral part of these consolidated financial statements. F- 6 TherapeuticsMD, Inc. and Subsidiaries Consolidated Statements of Cash Flows (In thousands) Years ended December 31, 2024 2023 Cash flows from operating activities: Net loss $ ( 2,181 ) $ ( 10,278 ) Less: Income (loss) from discontinued operations, net of tax 131 ( 2,579 ) Net loss from continuing operations ( 2,312 ) ( 7,699 ) Adjustments to reconcile net loss to net cash used in continuing operating activities: Depreciation and amortization 509 922 Impairment of long-lived assets (Note 4) 1,268 — Share-based payment compensation costs 264 1,271 Other ( 219 ) ( 129 ) Changes in operating assets and liabilities: Prepaid and other current assets 397 1,999 Other assets 1,930 ( 1,126 ) Accounts payable 231 ( 2,135 ) Accrued expenses and other current liabilities ( 1,006 ) ( 15,713 ) Other non-current liabilities 108 ( 471 ) Total adjustments 3,482 ( 15,382 ) Net cash provided by (used in) continuing operating activities 1,170 ( 23,081 ) Cash flows from continuing financing activities: Proceeds from sale of common stock, net of costs — 3,151 Net cash provided by continuing financing activities — 3,151 Discontinued operations: Net cash used in operating activities ( 438 ) ( 25,060 ) Net cash used in discontinued operations ( 438 ) ( 25,060 ) Net increase (decrease) in cash 732 ( 44,990 ) Cash and restricted cash - continuing operations, beginning of period 4,327 49,317 Total cash and restricted cash, end of period $ 5,059 $ 4,327 The accompanying notes are an integral part of these consolidated financial statements. F- 7 TherapeuticsMD, Inc. and Subsidiaries Notes to the Consolidated Financial Statements 1. Business, basis of presentation, new accounting standards and summary of significant accounting policies General TherapeuticsMD, Inc. (the “Company”), a Nevada corporation, and its consolidated subsidiaries are referred to collectively in this Annual Report on Form 10-K (“10-K Report”) as “TherapeuticsMD,” “we,” “our” and “us.” This 10-K Report includes trademarks, trade names and service marks, such as TherapeuticsMD®, vitaMedMD®, BocaGreenMD® , IMVEXXY®, and BIJUVA®, which are protected under applicable intellectual property laws and are the property of, or licensed by or to, us. Solely for convenience, trademarks, trade names and service marks referred to in this 10-K Report may appear without the ®, TM or SM symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the right of the applicable licensor to these trademarks, trade names and service marks. We do not intend our use or display of other parties’ trademarks, trade names or service marks to imply, and such use or display should not be construed to imply a relationship with, or endorsement or sponsorship of us by, these other parties. TherapeuticsMD was previously a women’s healthcare company with a mission of creating and commercializing innovative products to support the lifespan of women from pregnancy prevention through menopause. In December 2022, we changed our business to become a pharmaceutical royalty company, currently receiving royalties on products licensed to pharmaceutical organizations that possess commercial capabilities in the relevant territories. On December 30, 2022 (the “Closing Date”), we completed a transaction (the “Mayne Transaction”) with Mayne Pharma LLC, a Delaware limited liability company (“Mayne Pharma”) and subsidiary of Mayne Pharma Group Limited, an Australian public company, in which we and our subsidiaries (i) granted Mayne Pharma an exclusive license to commercialize our IMVEXXY, BIJUVA and prescription prenatal vitamin products sold under the BocaGreenMD and vitaMedMD brands (collectively, the “Licensed Products”) in the United States and its possessions and territories, (ii) assigned to Mayne Pharma our exclusive license to commercialize ANNOVERA® (together with the Licensed Products, collectively, the “Products”) in the United States and its possessions and territories, and (iii) sold certain other assets to Mayne Pharma in connection therewith. In a License Agreement, dated December 4, 2022, between TherapeuticsMD and Mayne Pharma (the “Mayne License Agreement”), we granted Mayne Pharma, on the Closing Date, (i) an exclusive, sublicensable, perpetual, irrevocable license to research, develop, register, manufacture, have manufactured, market, sell, use, and commercialize the Licensed Products in the United States and its possessions and territories and (ii) an exclusive, sublicensable, perpetual, irrevocable license to manufacture, have manufactured, import and have imported the Licensed Products outside the United States for commercialization in the United States and its possessions and territories. Under the Mayne License Agreement, Mayne Pharma will pay us milestone payments of each of (i) $ 5.0 million if aggregate net sales of all Products in the United States during a calendar year reach $ 100.0 million, (ii) $ 10.0 million if aggregate net sales of all Products in the United States during a calendar year reach $ 200.0 million and (iii) $ 15.0 million if aggregate net sales of all Products in the United States during a calendar year reach $ 300.0 million. Further, Mayne Pharma will pay us royalties on net sales of all Products in the United States at a royalty rate of 8.0 % on the first $ 80.0 million in annual net sales and 7.5 % on annual net sales above $ 80.0 million, subject to certain adjustments, for a period of 20 years following the Closing Date. The royalty rate will decrease to 2.0 % on a Product-by-Product basis upon the earlier to occur of (i) the expiration or revocation of the last patent covering a Product and (ii) a generic version of a Product launching in the United States. Mayne Pharma will pay us minimum annual royalties of $ 3.0 million per year for 12 years, adjusted for inflation at an annual rate of 3 %, subject to certain further adjustments, including as described below. Upon the expiry of the 20 -year royalty term, the licenses granted to Mayne Pharma under the Mayne License Agreement will become a fully paid-up and royalty free license for the Licensed Products. F- 8 Under the Transaction Agreement, dated December 4, 2022, between TherapeuticsMD and Mayne Pharma (the “Transaction Agreement”), we sold to Mayne Pharma, at closing, certain assets for Mayne Pharma to commercialize the Products in the United States, including, with the Population Council’s consent, our exclusive license from the Population Council to commercialize ANNOVERA (the “Transferred Assets”). The total consideration from Mayne Pharma to TherapeuticsMD for the purchase of the Transferred Assets under the Transaction Agreement and the grant of the licenses under the Mayne License Agreement was (i) a cash payment of $ 140.0 million at closing, (ii) a cash payment of approximately $ 12.1 million at closing for the acquisition of net working capital as determined in accordance with the Transaction Agreement and subject to certain adjustments, (iii) a cash payment of approximately $ 1.0 million at closing for prepaid royalties in connection with the Mayne License Agreement Amendment (as defined below) and (iv) the right to receive the contingent consideration set forth in the Mayne License Agreement, as amended. The acquisition of net working capital was determined in accordance with the Transaction Agreement and included significant estimates which could change materially for a period of up to two years following the Closing Date. On the Closing Date, TherapeuticsMD and Mayne Pharma entered into Amendment No. 1 to the Mayne License Agreement (the “Mayne License Agreement Amendment”). Pursuant to the Mayne License Agreement Amendment, Mayne Pharma agreed to pay us approximately $ 1.0 million in prepaid royalties on the Closing Date. The prepaid royalties reduced the first four quarterly payments that would have otherwise been payable pursuant to the Mayne License Agreement by an amount equal to $ 257 thousand per quarterly royalty payment plus interest calculated at 19 % per annum accruing from the Closing Date until the date such quarterly royalty payment was paid to us. We and Mayne Pharma settled the $ 1.5 million of consideration due to Mayne Pharma for the assumed obligations under a long-term services agreement, including our minimum payment obligations thereunder. As the parties agreed, during the second quarter of 2023 Mayne Pharma held back our royalty payment of $ 0.6 million and we funded an additional $ 0.9 million in August 2023 to settle the original $ 1.5 million payable. As part of the transformation that included the Mayne License Agreement, all results associated with former commercial operations have been reflected as discontinued operations in our consolidated financial statements. Assets and liabilities associated with the commercial business are classified as assets and liabilities of discontinued operations in our consolidated balance sheets. Additional disclosures regarding discontinued operations are provided in Note 2 of our consolidated financial statements. We also have license agreements with strategic partners to commercialize IMVEXXY and BIJUVA outside of the U.S. ● In July 2018, we entered into a license and supply agreement (the “Knight License Agreement”) with Knight Therapeutics Inc. (“Knight”) pursuant to which we granted Knight an exclusive license to commercialize IMVEXXY and BIJUVA in Canada and Israel. Knight obtained regulatory approval for IMVEXXY and BIJUVA and began commercialization efforts in 2024. ● In September 2019, we entered into an exclusive license and supply agreement (the “Theramex License Agreement”) with Theramex HQ UK Limited (“Theramex”) to commercialize IMVEXXY and BIJUVA outside of the U.S., excluding Canada and Israel. In 2021, Theramex secured regulatory approval for BIJUVA in certain European countries and began commercialization efforts in those countries. ● In December 2024, we transferred the right to commercialize IMVEXXY and BIJUVA in Israel from Knight to Theramex. In connection with our transformation into a pharmaceutical royalty company, the termination of our executive management team (except for Mr. Marlan Walker, our former General Counsel and current Chief Executive Officer) and all other employees was completed by December 31, 2022. Severance obligations for all employees other than executive officers were paid in full in January 2023 and severance obligations for terminated executive officers have been paid in accordance with their employment agreements and separation agreements as previously disclosed. As of December 31, 2023 and 2024, we employed one full-time employee primarily engaged in an executive position. F- 9 We have engaged external consultants who support our relationship with current partners and assist with certain financial, IT, legal, and regulatory matters and the continued wind-down of our historical business operations. On August 15, 2023, we entered into a master services agreement with JZ Advisory Group, pursuant to which Joseph Ziegler serves as our Principal Financial and Accounting Officer. Going concern Following the transaction with Mayne Pharma, our primary source of revenue is from royalties on products licensed to pharmaceutical organizations that possess commercial capabilities in the relevant territories. We may need to raise additional capital to provide additional liquidity to fund our operations until we become cash flow positive. To address our capital needs, we may pursue various equity and debt financing and other alternatives. The equity financing alternatives may include the private placement of equity, equity-linked, or other similar instruments or obligations with one or more investors, lenders, or other institutional counterparties or an underwritten public equity or equity-linked securities offering. Our ability to sell equity securities may be limited by market conditions, including the market price of our common stock, and our available authorized shares. To the extent that we raise additional capital through the sale of such securities, the ownership interests of our existing stockholders will be diluted, and the terms of these new securities may include liquidation or other preferences that adversely affect the rights of our existing stockholders. If we are not successful in obtaining additional financing, we could be forced to discontinue or curtail our business operations, sell assets at unfavorable prices, or merge, consolidate, or combine with a company with greater financial resources in a transaction that might be unfavorable to us. On May 1, 2023, we entered into a Subscription Agreement (the “Subscription Agreement”) with Rubric Capital Management LP (“Rubric”), pursuant to which we agreed to sell to Rubric, or one or more of its affiliates, up to an aggregate of 5,000,000 shares of our common stock, par value $ 0.001 per share (our “Common Stock”), from time to time during the term of the Subscription Agreement in separate draw-downs at our election. On June 29, 2023, we issued and sold 312,525 shares of Common Stock at a price per share equal to $ 3.6797 pursuant to the Subscription Agreement. We received gross proceeds of $ 1.15 million from the draw down, before expenses. On November 15, 2023, Rubric drew down an additional 877,192 shares of Common Stock at a price per share equal to $ 2.2761 . We received gross proceeds of $ 2.0 million from the drawdown, before expenses. There were no draw downs in 2024. In February 2024, the Company received Mayne Pharma’s calculation of the net working capital allowances for payer rebates and wholesale distributor fees pursuant to the Transaction Agreement, which differed significantly from the Company’s estimate of the allowances. The Company continues to believe its estimated allowances for payer rebates and wholesale distributor fees are reasonable and intends to resolve this matter through the processes permitted in the Transaction Agreement. The outcome of this matter is uncertain at this point. As a result, the Company cannot reasonably estimate a range of loss, and accordingly, the Company has not accrued any additional liability associated with Mayne Pharma’s allowance calculation for payer rebates and wholesale distributor fees, particularly as the Company believes the outcome of this matter to be intertwined with the resolution of the net working capital allowance for returns. In August 2024, the Company received information from Mayne Pharma pertaining to the net working capital allowance for returns that differs significantly from the Company’s estimate of the allowance. As of December 31, 2024, the Company believed no additional accrual was required for amounts that may be owed for the allowance for returns under the Transaction Agreement. The Company has not recorded any contingent gains or receivables for any such allowances. Management continues to monitor the unresolved and pending net working capital items as changes to estimated amounts owed or amounts due from Mayne Pharma may be material. If Mayne Pharma’s sales of Licensed Products grow more slowly than expected or decline, including as a result of Mayne Pharma Group’s pending sale to Cosette Pharmaceuticals, Inc., if the net working capital settlement with Mayne Pharma under the Transaction Agreement is greater than our current estimates, if we are unsuccessful with future financings or the supply chains related to the third-party contract manufacturers are worse than we anticipate, our existing cash reserves may be insufficient to satisfy our liquidity requirements. The potential impact of these factors in conjunction with the uncertainty of the capital markets raises substantial doubt about our ability to continue as a going concern for the next twelve months from the issuance of these financial statements. The accompanying consolidated financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern. F- 10 A. Basis of presentation The consolidated financial statements and related notes include our parent company and all wholly owned subsidiaries. The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Our fiscal year-end is as of and for the year ended December 31st for each year presented. All intercompany transactions among our businesses have been eliminated. As part of the transformation and as a result of the Mayne Transaction, all results associated with former commercial operations have been reflected as discontinued operations in the consolidated financial statements. Assets and liabilities associated with the commercial business are classified as assets and liabilities of discontinued operations in the consolidated balance sheet. Additional disclosures regarding discontinued operations are provided in Note 2 of these consolidated financial statements. Certain amounts in the notes to the consolidated financial statements may not add due to rounding. Certain prior period amounts have been reclassified to conform to current-period presentation. B. New accounting standards Adoption of new accounting standards As of December 2024, we have adopted Financial Accounting Standards Board (“FASB”) Update 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” (“Update 2023-07”). Accounting Standards Update 2023-07 applies to all public entities that are required to report segment information in accordance with Topic 280. The amendments in Update 2023-07 revise reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments in Update 2023-07 do not change how a public entity identifies its operating segments, aggregates those operating segments, or applies the quantitative thresholds to determine its reportable segments. In November 2024, the FASB issued Accounting Standards Update (“ASU”) 2024-03, “Income Statement - Reporting Comprehensive Income (Topic 220): Disaggregation of Income Statement Expenses.” The ASU requires additional disclosures by disaggregating the costs and expense line items that are presented on the face of the income statement. The disaggregation includes: (i) amounts of purchased inventory, employee compensation, depreciation, amortization, and other related costs and expenses; (ii) an explanation of costs and expenses that are not disaggregated on a quantitative basis; and (iii) the definition and total amount of selling expenses. ASU 2024-03 is effective for our Annual Report on Form 10-K beginning in 2027 and subsequent interim reports. Early adoption is permitted. The ASU should be applied prospectively. Retrospective application is permitted for all prior periods presented in the financial statements. The Company is evaluating the impact of ASU 2024-03 on our financial reporting disclosures. In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740) - Improvements to Income Tax Disclosures.” ASU 2023-09 enhances the transparency and decision usefulness of income tax disclosures by requiring consistent categories and greater disaggregation of information in the rate reconciliation and income taxes paid disaggregated by jurisdiction. ASU 2023-09 will be effective for the Company in its income tax disclosure included in its 2025 Annual Report on Form 10-K and will be applied on a prospective basis. However, retrospective application is permitted. Early adoption is also permitted. The Company is evaluating the impact of ASU 2023-09 on the Company’s income tax disclosures and on its consolidated financial statements. C. Discontinued Operations Discontinued operations comprise activities that were disposed of at the end of the period, represent a separate major line of business that can be clearly distinguished for operational and financial reporting purposes and represent a business shift having a major effect on the Company’s operations and financial results according to Accounting Standards Codification (“ASC”) Topic 205, Presentation of Financial Statements. In 2022, we started classifying commercial activities as discontinued operations due to the cessation of these operations. No amounts for shared general and administrative operating support expense were allocated to discontinued operations. As required by the terms of the Financing Agreement, dated as of April 24, 2019, as amended, with Sixth Street Specialty Lending, Inc., as administrative agent, the various lenders from time-to-time party thereto, and certain of our subsidiaries party thereto from time to time as guarantors, the proceeds from both transactions were used to fully repay our outstanding debt borrowings. As a result, interest expense and amortization of deferred financing costs as well as expense for accretion of Series A Preferred Stock and loss on extinguishment of debt are included within income (loss) from discontinued operations, net of tax. Additionally, the related assets and liabilities have been reported as assets and liabilities of discontinued operations in the Company’s consolidated balance sheets as of December 31, 2024 and 2023. For additional information, see Note 2 - Discontinued Operations. F- 11 D. Estimates and assumptions The preparation of consolidated financial statements in conformity with U.S. GAAP requires us to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. We evaluate our estimated assumptions based on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ, at times in material amounts, from these estimates under different assumptions or conditions. E. Cash and Restricted Cash For the purpose of the statements of cash flows, all highly liquid investments with an original maturity of three months or less are considered to be cash equivalents. The carrying value of these investments approximates fair value. We maintain cash at financial institutions that at times may exceed the Federal Deposit Insurance Corporation (“FDIC”) insured limits of $ 250 thousand per bank. We have never experienced any losses related to these funds. F. Fair Value Measurements Fair value is the price to sell an asset or transfer a liability and therefore represents an exit price in the principal market (or in the absence of a principal market, the most advantageous market). It represents a market-based measurement that contemplates a hypothetical transaction between market participants at the measurement date. The unique characteristics of an asset or liability and the availability of observable prices affect the number of valuation approaches and/or techniques used in a fair value analysis. We measure fair value using observable and unobservable inputs. We give the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1 inputs) and the lowest priority to unobservable inputs (Level 3 inputs). We apply the following fair value hierarchy: ● Level 1 - Quoted prices (unadjusted) in active markets for identical assets and liabilities. ● Level 2 - Quoted prices in non-active markets or in active markets for similar assets or liabilities, observable inputs other than quoted prices; and inputs that are not directly observable but are corroborated by observable market data. ● Level 3 - Inputs that are unobservable. The carrying amount of our cash, restricted cash, accounts receivable, accounts payable and accrued expenses approximate their fair value because of the short-term maturity of such instruments, which are considered Level 1 under the fair value hierarchy. G. License rights and other intangibles assets We record license rights and other intangible assets at cost, which includes external costs, consisting primary of legal costs, incurred in securing our patents and trademarks. Intangible assets subject to amortization, such as patents, are amortized over the useful life of the patent using the straight-line method. If the patent is not successfully granted, we write off any capitalized patent costs at that time. Intangible assets not subject to amortization, such as trademarks, are perpetual and have indefinite lives. F- 12 We review license rights and other intangible assets subject to amortization on a periodic basis to determine whether events and circumstances would indicate impairment or warrant a revision to their remaining useful lives. We assess other intangible assets not subject to amortization for potential impairment semi-annually during the second and fourth quarter of each year, or more frequently if events occur or circumstances change that would more likely than not reduce the fair value of the intangible assets below their carrying value. H. Segment reporting We manage and operate as one business, which prior to December 2022 was focused on creating and commercializing products targeted exclusively for women and after we signed Mayne License Agreement, is focused on collecting royalties from licensing our products. Our business is led by our chief executive officer, who is our Chief Operating Decision Maker (“CODM”). We do not operate separate lines of business with respect to any of our products, and we do not prepare discrete financial information with respect to separate products. Accordingly, we view our business as one reportable operating segment. I. Revenue recognition We determine the amount of revenue to be recognized through application of the following steps: ● Identification of the contract with a customer; ● Identification of the performance obligations in the contract; ● Determination of the transaction price; ● Allocation of the transaction price to the performance obligations in the contract; and ● Recognition of revenue when or as we satisfy the performance obligations. A performance obligation is a promise in a contract to transfer a product or service to a customer. A good or service is considered to be transferred when the customer receives the goods or service or obtains control, and we treat shipping as a fulfillment activity rather than as a separate obligation. We generally recognize revenue at a point in time when all of our performance obligations under the terms of a contract are satisfied. Revenue is recognized upon transfer of control of promised products or services in an amount that reflects the consideration we expect to receive in exchange for those products or services. The collectability of consideration on the contract is reasonably assured before revenue is recognized. To the extent that customer payment has been received before all recognition criteria are met, these revenues are initially deferred in other accruals on the balance sheet and the revenue is recognized in the period that all recognition criteria have been met. License revenue License arrangements may consist of non-refundable upfront license fees, exclusive licensed rights to patented or patent pending technology, and various performance or sales milestones and future product royalty payments. Some of these arrangements may include multiple performance obligations. Non-refundable up-front fees that are not contingent on any future performance by us, and do not require continuing involvement on our part, are recognized as revenue when the right to use functional intellectual property is transferred to the customer. On December 30, 2022, we granted an exclusive license to commercialize our prescription products and assigning the Company’s exclusive license to commercialize ANNOVERA to Mayne Pharma, which resulted in a business shift that had a major effect on our operations and financial results. As part of the transformation that included the Mayne License Agreement, all results associated with former commercial operations have been reflected as discontinued operations in the Company’s consolidated financial statements for all periods prior to the Closing Date. As of December 31, 2022, we are no longer directly engaged in the sale of prescription products. F- 13 Under the terms of the Mayne License Agreement, we received $ 140 million at closing and we are eligible to receive additional payments in the aggregate of up to an additional $ 30 million, based on the achievement of sales milestones (collectively, the “Milestone Amounts”). The proceeds at closing were allocated between consideration for the sale of ANNOVERA and the initial license fee for the Licensed Products, as the sale of ANNOVERA was accounted for under ASC 610-20, Gains and Losses from Derecognition of Nonfinancial Assets in arriving at the gain on disposal (see Note 2), while the license grant of the other products were recognized under the provisions of ASC 606, Revenue from Contracts with Customers, as a license of functional intellectual property. The proceeds were allocated among the Licensed Products on the relative net present value of forecasted future product sales from those products. The Milestone Amounts will be recognized, as applicable, in subsequent periods based on actual product sales that exceed the respective net sales milestones as such variable consideration is constrained by the occurrence of the subsequent sales. Our royalty revenue in 2024 and 2023 primarily related to royalties provided for under the Mayne License Agreement based on Mayne Pharma’s sales of the licensed products subject to that agreement. Under the Mayne License Agreement, the Company is entitled to earn royalties on net sales of all of the Licensed Products at a royalty rate of (i) 8 % on the first $ 80 million of net sales of the Licensed Products and (ii) 7.5 % on net sales of all of the Licensed Products after the first $ 80 million of net sales. The royalty rate is subject to a 2 % reduction upon the earlier to occur of (i) the expiration or revocation of the last valid claim covering a Licensed Product, and (ii) a generic product launch (a “LOE”). We are entitled to minimum annual royalties beginning with the year ending December 31, 2023 ($ 3 million annual minimum) and continuing with 3 % annual increases through the year ending December 31, 2034 (the “Minimum Annual Royalty”). The total Minimum Annual Royalty we are entitled to is $ 42.6 million, and this total amount was allocated among the Licensed Products on the relative net present value of forecasted future product sales from those products. The portion allocated to consideration for the sale of ANNOVERA was attributed towards the gain on disposal of that asset. For the remaining portion allocated to the license grants for the other products, we determined that the minimum guarantee underlying the Minimum Annual Royalty should be treated as fixed consideration and recognized under ASC 606 at the point in time when the license was transferred. Since the Minimum Annual Royalty will be received in annual installments through 2034, we determined the transaction price allocated under ASC 606 contained a significant financing component, and we therefore determined the initial royalty revenue and corresponding receivable based on the present value of the allocated Minimum Annual Royalty. The present value was calculated using a discount rate of 10.45 %, based on the credit characteristics of Mayne Pharma and the timing of future payments, and the value will be accreted to full value through the earlier of January 1, 2034, or a LOE. This royalty receivable is a contract asset as of December 31, 2023 and 2024, and is further subject to offset by Mayne Pharma (see J. Contract Assets and Liabilities below). Royalty revenue earned in excess of the Minimum Annual Royalty will be recognized under ASC 606, which provides revenue recognition constraints by requiring the recognition of revenue at the later of the following: 1) when the subsequent sale occurs or 2) when the performance obligation to which some or all of the sales-based royalty has been allocated has been satisfied (or partially satisfied). We applied the royalty recognition constraint required under the guidance for sales-based royalties, which requires a sales-based royalty to be recorded no sooner than the underlying sale. Therefore, royalties on sales of products commercialized by Mayne Pharma will be recognized in the subsequent periods that the Licensed Products are sold. In 2024, we recorded BIJUVA license sales of $ 443 thousand made through the Theramex License Agreement, BIJUVA and IMVEXXY license sales of $ 195 thousand through the Knight License Agreement and $ 1,123 thousand pertaining to our licensed products with Mayne Pharma, which was recognized as license revenue. Additionally, we recognized $ 1,083 thousand in other income pertaining to royalty sales of ANNOVERA. In 2023, we recorded BIJUVA license sales of $ 268 thousand made through the Theramex License Agreement and $ 1,003 thousand pertaining to our licensed products with Mayne Pharma, which was recognized as license revenue. Additionally, we recognized $ 490 thousand in other income pertaining to royalty sales of ANNOVERA. J. Contract Assets and Liabilities Contract assets totaling $ 19,572 thousand and $ 21,574 thousand as of December 31, 2024 and 2023, respectively, include royalties recognized from the Minimum Annual Royalty (see I. Revenue Recognition above). K. Share-based payment awards We account for share-based payment awards on a fair value basis of the equity instrument issued. Under fair value accounting, the grant-date fair value of the share-based payment award is amortized as compensation expense, on a straight-line basis, over the service period (generally, the vesting period) for both graded and cliff vesting awards. We have elected to account for forfeitures as they occur. F- 14 Increase of authorized shares On June 26, 2023, at our combined 2022 and 2023 Annual Meeting, our stockholders approved an amendment to our Amended and Restated Articles of Incorporation to increase the number of authorized shares of Common Stock from 12 million shares to 32 million shares. L. Income taxes Income taxes are accounted for under the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and operating loss and income tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in income tax rates is recorded as a component of the income tax provision in the period that includes the enactment date. Regular assessments are made on the likelihood that our deferred tax assets will be recovered from our future taxable income. Our evaluation is based on estimates, assumptions, and includes an analysis of available positive and negative evidence, giving weight based on the evidence’s relative objectivity. Sources of positive evidence include estimates of future taxable income, future reversal of existing taxable temporary differences, taxable income in carryback years, and available tax planning strategies. Sources of negative evidence include current and cumulative losses in recent years, losses expected in early future years, any history of operating losses or tax credit carryforwards expiring unused, and unsettled circumstances that, if unfavorably resolved, would adversely affect future profit levels. The remaining carrying value of our deferred tax assets, after recording the valuation allowance on our deferred tax assets, is based on our present belief that it is more likely than not that we will be able to generate sufficient future taxable income to utilize such deferred tax assets. The amount of the remaining deferred tax assets considered recoverable could be adjusted if our estimates of future taxable income during the carryforward period change favorably or unfavorably. To the extent we believe that it is more likely than not that some or all the remaining deferred tax assets will not be realized, we must establish a valuation allowance against those deferred tax assets, resulting in additional income tax expense in the period such determination is made. To the extent a valuation allowance currently exists, we will continue to monitor all positive and negative evidence until we believe it is more likely than not that it is no longer necessary, resulting in an income tax benefit in the period such determination is made. F- 15 Our policy is to recognize both interest and penalties related to uncertain tax positions as part of the income tax provision. Significant judgment is required in evaluating our tax positions, and in determining our provisions for income taxes, our deferred tax assets and liabilities and any valuation allowance recorded against our net deferred tax assets. We establish reserves when, despite our belief that the income tax return positions are fully supportable, certain positions are likely to be challenged and we may ultimately not prevail in defending those positions. M. Earnings per common share Basic earnings or loss per common share is computed by dividing net income or loss available to common stockholders by the sum of the weighted average number of shares of common stock. Diluted earnings per common share is computed by dividing net income available to common stockholders by the sum of the weighted average number of shares of common stock and the number of additional shares of common stock that would have been outstanding if our outstanding potentially dilutive securities had been issued. Potentially dilutive securities include awards of non-vested or vested and not settled restricted stock units, performance stock units where the performance requirements have been met and not settled, warrants and options. The dilutive effect of potentially dilutive securities is reflected in diluted earnings per common share by application of the treasury stock method, except if its impact is anti-dilutive. Under the treasury stock method, an increase in the fair market value of our common stock can result in a greater dilutive effect from potentially dilutive securities. N. Leases We determine if an arrangement is a lease at inception. Determining whether a contract contains a lease includes judgment regarding whether the contract conveys the right to control the use of identified property or equipment for a period of time in exchange for consideration. We account for our lease-related assets and liabilities based on their classification as operating leases or finance leases, following the relevant accounting guidance. For all the lessee arrangements, we have elected an accounting policy to combine non-lease components with the related-lease components and treat the combined items as a lease for accounting purposes. We measure lease related assets and liabilities based on the present value of lease payments, including in-substance fixed payments, variable payments that depend on an index or rate measured at the commencement date, and the amount we believe is probable we will pay the lessor under residual value guarantees when applicable. We discount lease payments based on our estimated incremental borrowing rate at lease commencement (or modification), which is primarily based on our estimated credit rating, the lease term at commencement, and the contract currency of the lease arrangement. We have elected to exclude short-term leases (leases with an original lease term less than one year) from the measurement of lease-related assets and liabilities. We test right-of-use assets in an operating or finance lease at the asset group level (because these assets are long-lived nonfinancial assets and should be accounted for the same way as other long-lived nonfinancial assets) whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. We sublease our unoccupied facilities to third parties. Any impairment to the associated right-of-use asset, leasehold improvements, or other assets as a result of the sublease is recognized in the period when a decision to sublease is made and recorded in our consolidated statement of operations. We recognize sublease income on a straight-line basis over the sublease term. O. Loss Contingencies In determining whether an accrual for a loss contingency is required, we first assess the likelihood of occurrence of the future event or events that will confirm the loss. When a loss is probable (the future event or events are likely to occur) and the amount of the loss can be reasonably estimated, the estimated loss is accrued. If the reasonable estimate of the loss is a range and an amount within the range appears to be a better estimate than any other amount within the range, that amount should be accrued. However, if no amount within the range is a better estimate, the minimum amount in the range should be accrued. When a loss is reasonably possible (the chance of the future event or events occurring is more than remote but less than likely), no accrual is recognized. See Note 7 for more information. F- 16 P. Restructuring charges There were no restructuring costs incurred during the years ended December 31, 2024 and 2023. At December 31, 2023, $ 2,459 thousand of restructuring costs were included in current liabilities of discontinued operations in the accompanying consolidated balance sheet. 2. Discontinued Operations As discussed in Note 1, we changed our business in 2022 by licensing our products to receive royalties and future sales related milestone payments, after granting an exclusive license to commercialize our IMVEXXY, BIJUVA, and prescription prenatal vitamin products sold under the BocaGreenMD and vitaMedMD brands in the United States and assigning our exclusive license to commercialize ANNOVERA to Mayne Pharma. This plan represented a strategic shift having a major effect on our operations and financial results. Upon our conversion from a commercial pharmaceutical company to a licensing only company with the consummation of the Mayne Transaction, we classified all direct revenues, costs and expenses related to commercial operations, within income (loss) from discontinued operations, net of tax, in the consolidated statements of operations for all periods presented. We have not allocated any amounts for shared general and administrative operating support expense to discontinued operations. Additionally, the related assets and liabilities have been reported as assets and liabilities of discontinued operations in our consolidated balance sheets as of December 31, 2024 and 2023. As described in Note 1, the acquisition of net working capital by Mayne Pharma was determined in accordance with the Transaction Agreement and included significant estimates which could change materially for a period of up to two years following the Closing Date. Our estimate of net working capital at closing was determined in accordance with the Transaction Agreement which establishes the process for the determination of final net working capital. Refer to Note 7 for a further discussion of net working capital contingencies. F- 17 The following table presents results of discontinued operations (in thousands): Years ended December 31, 2024 2023 Product revenue, net $ — $ ( 833 ) General and administrative 64 481 Total operating expenses 64 481 Operating loss from discontinued operations ( 64 ) ( 1,314 ) Loss on disposal of assets — ( 1,150 ) Other Income (expense), net 195 ( 115 ) Total other income (expense), net 195 ( 1,265 ) Net income (loss) from discontinued operations $ 131 $ ( 2,579 ) The following table presents the carrying amounts of the classes of assets and liabilities of discontinued operations (in thousands): As of December 31, 2024 2023 Assets: Accounts receivable $ — $ 344 Liabilities: Accrued expenses and other current liabilities $ 2,781 $ 3,694 3. Prepaid and other current assets Our prepaid and other current assets consisted of the following (in thousands): December 31, 2024 2023 Insurance $ 70 $ 253 Capitalized legal 2,334 2,334 Other 1,234 1,448 Prepaid and other current assets $ 3,638 $ 4,035 F- 18 4. Licensed rights and other intangible assets The following provides information about our license rights and other intangible assets, net (in thousands): As of December 31, 2024 As of December 31, 2023 Gross Gross Carrying Accumulated Carrying Accumulated Amount Amortization Net Amount Amortization Net Intangible assets subject to amortization: Hormone therapy drug patents $ 5,766 $ 2,058 $ 3,708 $ 6,818 $ 1,871 $ 4,947 Hormone therapy drug patents applied and pending approval 304 — 304 842 — 842 Intangible assets subject to amortization 6,070 2,058 4,012 7,660 1,871 5,789 Intangible assets not subject to amortization: Trademarks/trade name rights 309 — 309 309 — 309 Intangible assets, net $ 6,379 $ 2,058 $ 4,321 $ 7,969 $ 1,871 $ 6,098 We recorded, in continuing operations, amortization expense related to patents of $ 509.1 thousand for 2024 and $ 844.2 thousand for 2023, of which $ 483.5 thousand is accelerated amortization as a result of a review of our intangible assets. The Company conducts regular reviews of the individual patents and portfolios. As a result of this review and also based on input from its licensing partners, in the three months ended June 30, 2024 the Company determined it had an indicator of impairment, as it had abandoned the legal right and title to a portion of its granted patent portfolio and had ceased pursuit of a portion of its pending patents based on input from its licensing partners. The Company recognized an impairment loss of $ 1,268 thousand related to those abandoned patents and applications, which is classified as an impairment of long-lived assets on the Company’s consolidated statements of operations for the twelve months ended December 31, 2024. In the year ending December 31, 2023, we did not impair any of our hormone therapy drug patent assets. Our intangible assets subject to amortization are expected to be amortized as follows (in thousands): Year ending December 31, 2025 $ 384 2026 384 2027 384 2028 385 2029 384 Thereafter 1,787 Total $ 3,708 5. Accrued expenses and other current liabilities Other accrued expenses and other current liabilities consisted of the following (in thousands): As of December 31, 2024 2023 Payroll and related costs $ 118 $ 762 Professional fees 288 489 Operating lease liabilities 1,633 1,473 Other accrued expenses and current liabilities 88 409 Accrued expenses and other current liabilities $ 2,127 $ 3,133 We incurred no advertising costs in 2024 and 2023. F- 19 6. Debt Interest and financing costs Included in miscellaneous income in 2024 is $ 144.9 thousand of interest income and $ 9.5 thousand of interest expense. Included in miscellaneous income in 2023 is $ 297.9 thousand of interest income and $ 166.6 thousand of interest expense. 7. Commitments and contingencies Leases In October 2018, we entered into a lease for executive, administrative, operations and sales offices in Boca Raton, Florida. The lease includes 62,748 rentable square feet, or the full premises, of which the lease on 7,561 square feet commenced in 2018 and the lease on 48,651 square feet commenced in August 2019, or the full premises commencement date. In June 2019, we entered into an agreement with the same lessors to lease additional 6,536 square feet of administrative office space in the same location, pursuant to an addendum to such lease, which commenced in May 2020. The lease will expire 11 years after the full premises commencement date, unless terminated earlier in accordance with the terms of the lease. We have the option to extend the term of the lease for two additional consecutive periods of five years . The extension option is not included in the determination of the lease term as it is not reasonably certain to be exercised. The term of the lease includes escalating rent and free rent periods. We are also responsible for certain other operating costs under the lease, including electricity and utility expenses. As a result of shifting our business to become a license company and terminating our employees, we have sublet the majority of our headquarters and are in the process of subleasing the remainder. We anticipate that sublease income will approximate the amounts due under our existing leases, therefore no impairment of the right of use asset was recorded in 2024. For 2024 and 2023, operating lease expense (including all variable costs) related to our real estate leases was $ 2,271 thousand and $ 2,259 thousand, respectively. In 2024 and 2023, our rental income on sublease of our three suites which were subleased was $ 1,361 thousand and $ 1,292 thousand, respectively. As of December 31, 2024, our remaining lease payments were as follows (in thousands): Year ending December 31, 2025 $ 1,513 2026 1,551 2027 1,590 2028 1,630 2029 1,671 Thereafter 993 Total undiscounted lease payments 8,948 Less: imputed interest 1,773 Present value of lease payments $ 7,175 F- 20 The following table sets forth supplemental balance sheet information related to leases (in thousands): As of December 31, 2024 2023 Assets: Operating lease right-of-use assets $ 6,102 $ 6,873 Liabilities: Operating lease liabilities current (included in accrued expenses and other current liabilities) $ 1,633 $ 1,473 Operating lease liabilities, non-current 5,542 6,532 Total operating lease liabilities $ 7,175 $ 8,005 The following table presents other information related to leases: As of December 31, 2024 2023 Weighted average remaining term (years) - operating leases 5.7 6.7 Weighted average discount rate - operating leases 8.3 % 8.3 % Cash paid for amounts included in the measurement of lease liabilities from operating lease (in thousands) $ 1,477 $ 1,443 Right-of-use assets obtained in exchange for new operating lease obligations (non-cash in thousands) $ — $ — Mayne Pharma Agreement Mayne Pharma paid us approximately $ 12.1 million at closing on December 30, 2022, for the acquisition of net working capital, subject to certain adjustments as determined in accordance with the Transaction Agreement. While the Transaction Agreement calls for much of the net working capital to be trued-up shortly after the Closing Date in 2023, for a period of one year following the Closing Date in the case of payer rebates and wholesale distributor fees and two years following the Closing Date in the case for allowance for returns, net working capital amounts will be adjusted to arrive at final net working capital under the Transaction Agreement. In September 2023, we increased certain accrual estimates including increasing our working capital adjustment accrual by $ 2.0 million for amounts anticipated to be owed under the Transaction Agreement. In December 2023, we made a $ 5.5 million payment to Mayne Pharma to settle certain working capital amounts that were required to be trued-up shortly after the Closing Date, excluding the allowance for returns, allowance for payer rebates, and allowance for wholesale distributor fees. Of the $ 5.5 million, $ 2.0 million increased the allowance for net working capital allowances remaining to be trued up. F- 21 The Company’s estimate of the allowance for payer rebates and wholesale distributor fees was determined in accordance with the Transaction Agreement which establishes the process for the determination of net working capital. In February 2024, the Company received Mayne Pharma’s calculation of the net working capital allowances for payer rebates and wholesale distributor fees which differed significantly from the Company’s estimate of the allowances. The Company and Mayne Pharma intend to resolve this matter through the dispute resolution process outlined in the Transaction Agreement. The outcome of this matter is uncertain at this point. As a result, the Company cannot reasonably estimate a range of loss, and accordingly, the Company has not accrued any additional liability associated with Mayne Pharma’s allowance calculation for payer rebates and wholesale distributor fees, particularly as the Company believes the outcome of this matter to be intertwined with the resolution of the net working capital allowance for returns. In August 2024, the Company received information from Mayne Pharma pertaining to the net working capital allowance for returns that differs significantly from the Company’s estimate of the allowance. As of December 31, 2024, the Company believed no additional accrual was required for amounts that may be owed for the allowance for returns under the Transaction Agreement. The Company has not recorded any contingent gains or receivables for any such allowances. Management continues to monitor the unresolved and pending net working capital items as changes to estimated amounts owed or amounts due from Mayne Pharma may be material. Mayne Pharma has also made certain indemnification demands under the Transaction Agreement, which the Company disputes. As of December 31, 2024, the Company believed no additional accrual was required for such claims, as the Company could not reasonably estimate a range of loss. Legal proceedings In February 2020, we received a Paragraph IV certification notice letter (the “IMVEXXY Notice Letter”) regarding an Abbreviated New Drug Application (“ANDA”) submitted to the FDA by Teva Pharmaceuticals USA, Inc. (“Teva”). The ANDA seeks approval from the FDA to commercially manufacture, use, or sell a generic version of the 4 mcg and 10 mcg doses of IMVEXXY. In the IMVEXXY Notice Letter, Teva alleges that TherapeuticsMD patents listed in the FDA’s Orange Book that claim compositions and methods of IMVEXXY (the “IMVEXXY Patents”) are invalid, unenforceable, and/or will not be infringed by Teva’s commercial manufacture, use, or sale of its proposed generic drug product. The IMVEXXY Patents identified in the IMVEXXY Notice Letter expire in 2032 or 2033. In April 2020, we filed a complaint for patent infringement against Teva in the United States District Court for the District of New Jersey arising from Teva’s ANDA filing with the FDA. We are seeking, among other relief, an order that the effective date of any FDA approval of Teva’s ANDA would be a date no earlier than the expiration of the IMVEXXY Patents and equitable relief enjoining Teva from infringing the IMVEXXY Patents. Teva has filed its answer and counterclaim to the complaint, alleging that the IMVEXXY Patents are invalid and not infringed. In July 2021, following a proposal by Teva, the District Court entered an order temporarily staying all proceedings in the IMVEXXY litigation, which order was filed under seal. In September 2021, the District Court made available a public version of the order following the parties’ agreement to a consent motion to redact information Teva contended was confidential. The order provides that the statutory stay that prevents the FDA from granting final approval of the ANDA for 30 months from the date of the IMVEXXY Notice Letter will be extended for the number of days that the stay of the IMVEXXY litigation is in place. In November 2024, the court lifted the stay. We have incurred and recorded legal costs amounting to $ 2,334 thousand in prepaid expenses and other current assets as of December 31, 2024, for the IMVEXXY Paragraph IV legal proceeding since we believe that we will successfully prevail in this legal proceeding. Upon the successful conclusion of the legal proceeding, the related capitalized legal costs will be reclassified to patents, in license rights and other intangible assets, net, in the accompanying consolidated balance sheets, and such costs will be amortized over the remaining useful life of the patents. If Mayne Pharma is unsuccessful in this legal proceeding, then the related capitalized legal costs for this legal preceding and any unamortized IMVEXXY patent costs that were previously capitalized will be immediately expensed in the period in which we become aware of an unsuccessful legal proceeding. In June 2024, Mayne Pharma received a Paragraph IV certification notice letter (the “Sun Notice Letter”) regarding an ANDA submitted to the FDA by Sun Pharma Inc. (“Sun Pharma”). The ANDA seeks approval from the FDA to commercially manufacture, use, or sell a generic version of the 4 mcg and 10 mcg doses of IMVEXXY. In the Sun Notice Letter, Sun Pharma alleges that the IMVEXXY Patents are invalid, unenforceable, and/or will not be infringed by Sun Pharma’s commercial manufacture, use, or sale of its proposed generic drug product. The IMVEXXY Patents identified in the Sun Notice Letter expire in 2032 or 2033. In July 2024, we and Mayne Pharma filed a complaint for patent infringement against Sun Pharma in the United States District Court for the District of New Jersey arising from Sun Pharma’s ANDA filing with the FDA. We are seeking, among other relief, an order that the effective date of any FDA approval of Sun Pharma’s ANDA would be a date no earlier than the expiration of the IMVEXXY Patents and equitable relief enjoining Sun Pharma from infringing the IMVEXXY Patents. F- 22 Beginning on December 30, 2022 and per the Mayne License Agreement, Mayne Pharma is responsible for all enforcement of our patents, including the responsibility for and costs of litigation discussed above with respect to Teva and Sun Pharma. From time to time, we are involved in other litigations and proceedings in the ordinary course of business. We are currently not involved in any other litigations and proceedings that we believe would have a material effect on our consolidated financial condition, results of operations, or cash flows. Off-balance sheet arrangements As of December 31, 2024 and 2023 we had no off-balance sheet arrangements that have had or are reasonably likely to have current or future effects on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that we consider material. Employment agreements In connection with our transformation into a pharmaceutical royalty company, the termination of our executive management team (except for Mr. Marlan Walker, our former General Counsel and current Chief Executive Officer) and all other employees was completed by December 30, 2022. Severance obligations for all employees other than executive officers were paid in full in the first quarter of 2023. As of December 31, 2024 and 2023, we employed one full-time employee primarily engaged in an executive position. We have engaged external consultants who support our relationship with current partners and assist with certain financial, IT, legal, and regulatory matters and the continued wind-down of our historical business operations. In the aggregate, as of December 31, 2024, we have accrued severance liabilities for executive termination obligations of $ 17 thousand. 8. Stockholders’ Equity Increase of authorized shares On June 26, 2023, at our combined 2022 and 2023 Annual Meeting, our stockholders approved an amendment to our Amended and Restated Articles of Incorporation to increase the number of authorized shares of Common Stock from 12 million shares to 32 million shares. Warrants As of December 31, 2024, the following table summarizes the status of our outstanding and exercisable warrants and related transactions since December 31, 2022 (in thousands, except weighted average exercise price and weighted average remaining contractual life data): Warrants outstanding and exercisable Warrants Weighted Average Exercise Price Aggregate Intrinsic Value Weighted Average Remaining Contractual Life (in Years) Balance, December 31, 2022 536 $ 13.10 2,427 9.3 Exercised ( 435 ) 0.01 ( 2,720 ) Expired ( 2 ) 0.89 Balance, December 31, 2023 99 66.61 1,793 6.5 Expired ( 1 ) 281.50 — — Balance, December 31, 2024 98 $ 63.33 $ — 5.6 F- 23 Share-based compensation payment plans As of December 31, 2024, 56,530 shares of common stock were subject to outstanding awards under our share-based payment award plans and inducement grants (calculated using the base number of PSUs that may vest). As of December 31, 2024, 410,719 shares of common stock were available for future grants of share-based payment awards under the TherapeuticsMD, Inc. 2019 Stock Incentive Plan. The following table summarizes the status of our outstanding and exercisable options and related transactions since December 31, 2022 (in thousands, except weighed average exercise price and weighted average remaining contractual life data): Outstanding Exercisable Options Awards Weighted Average Exercise Price Aggregate Intrinsic Value Weighted Average Remaining Contractual Life (in Years) Options Awards Weighted Average Exercise Price Aggregate Intrinsic Value Weighted Average Remaining Contractual Life (in Years) As of December 31, 2022 172 $ 228.28 — 3.6 170 229.43 $ — 3.6 Expired ( 100 ) 206.15 — — ( 98 ) — — — As of December 31, 2023 72 258.55 — 3.0 72 258.46 — 3.0 Expired ( 15 ) 217 — — ( 15 ) — — — As of December 31, 2024 57 $ 270.33 $ — 2.8 57 270.20 $ — 2.8 The following table summarizes the status of our RSUs and related transactions (in thousands, except weighed average grant date fair value): RSUs awards outstanding RSUs Weighted Average Grant Date Fair Value Aggregate Intrinsic Value Balance, as of December 31, 2022 57 $ 14.57 $ 318.63 Granted 163 4.82 — Vested ( 180 ) 6.83 — Balance, as of December 31, 2023 40 9.67 89.60 Vested ( 38 ) 9.11 — Balance, as of December 31, 2024 2 $ 21.78 $ 1.49 The following table summarizes the status of our PSUs and related transactions for each for the following years (in thousands, except weighed average grant date fair value): PSUs Weighted Average Grant Date Fair Value Aggregate Intrinsic Value Unvested, as of December 31, 2022 19 $ 52.15 $ 107.55 Vested ( 7 ) 56.05 ( 10.72 ) Unvested, as of December 31, 2023 12 49.36 27.3 Vested ( 7 ) 60.50 16.16 Balance, as of December 31, 2024 5 $ 34.50 $ 4.47 F- 24 Share-based payment compensation cost Share-based payment compensation expense for PSUs is based on 100 % vesting which was a part of the termination benefits for all employees who were terminated in 2022. We recorded share-based payment award compensation costs related to previously issued options, RSU and PSUs, as well as shares of common stock issued under our employee stock purchase plan (“ESPP”) totaling $ 264.1 thousand for 2024 and $ 1,271.2 thousand for 2023. As of December 31, 2024, we had $ 23.9 thousand of unrecognized share-based payment award compensation cost related to unvested options, RSUs and PSUs as well as shares issuable under our ESPP, which may be adjusted for future changes in forfeitures and is included as additional paid-in capital in the accompanying consolidated balance sheets. No tax benefit was realized due to a continued pattern of net losses. The unrecognized compensation cost as of December 31, 2024 of $ 23.9 thousand is expected to be recognized as share-based payment award compensation over a weighted average period of 0.2 years. 9. Revenue Pursuant to the Mayne License Agreement, the Company granted Mayne Pharma, on the Closing Date, (i) an exclusive, sublicensable, perpetual, irrevocable license to research, develop, register, manufacture, have manufactured, market, sell, use, and commercialize the Licensed Products in the United States and its possessions and territories and (ii) an exclusive, sublicensable, perpetual, irrevocable license to manufacture, have manufactured, import and have imported the Licensed Products outside the United States for commercialization in the United States and its possessions and territories. Pursuant to the Mayne License Agreement, Mayne Pharma will make one-time, milestone payments to the Company of each of (i) $ 5.0 million if aggregate net sales of all Products in the United States during a calendar year reach $ 100.0 million, (ii) $ 10.0 million if aggregate net sales of all Products in the United States during a calendar year reach $ 200.0 million and (iii) $ 15.0 million if aggregate net sales of all Products in the United States during a calendar year reach $ 300.0 million. Further, Mayne Pharma will pay to the Company royalties on net sales of all Products in the United States at a royalty rate of 8.0 % on the first $ 80 million in annual net sales and 7.5 % on annual net sales above $ 80.0 million, subject to certain adjustments, for a period of 20 years following the Closing Date. The royalty rate will decrease to 2.0 % on a Product-by-Product basis upon the earlier to occur of (i) the expiration or revocation of the last patent covering a Product and (ii) a generic version of a Product launching in the United States. Mayne Pharma will pay to the Company minimum annual royalties of $ 3.0 million per year for 12 years, adjusted for inflation at an annual rate of 3 %, subject to certain further adjustments. Upon the expiry of the 20 -year royalty term, the licenses granted to Mayne Pharma under the Mayne License Agreement will become a fully paid-up and royalty free license for the Licensed Products. In 2024, we recorded BIJUVA license sales of $ 443 thousand made through the Theramex License Agreement, BIJUVA and IMVEXXY license sales of $ 195 thousand through the Knight License Agreement and $ 1,123 thousand pertaining to our licensed products with Mayne Pharma, which was recognized as license revenue. Additionally, we recognized $ 1,083 thousand in other income pertaining to royalty sales of ANNOVERA. In 2023, we recorded BIJUVA license sales of $ 268 thousand made through the Theramex License Agreement and $ 1,003 thousand pertaining to our licensed products with Mayne Pharma, which was recognized as license revenue. Additionally, we recognized $ 490 thousand in other income pertaining to royalty sales of ANNOVERA. F- 25 10. Income taxes Our loss from continuing operations before income taxes is as follows (in thousands): Year Ending December 31, 2024 2023 United States $ ( 2,343 ) $ ( 7,742 ) For the year ended December 31, 2024 and 2023, there was no provision for income taxes in continuing and discontinued operations, current or deferred. For the year ended, December 31, 2024 and 2023, we recorded a benefit of 1.3 % and 0.5 %, respectively, in continuing operations. As of December 31, 2024, we had a federal net operating loss (“NOL”) carryforward of $ 579.0 million, which is available to offset future taxable income. Approximately $ 22.7 million of the federal NOLs can be carried forward for 20 years and will begin to expire in 2035. The remaining $ 557 million can be carried forward indefinitely. In the event of future income, the NOL deduction arising from NOLs generated in taxable years beginning in 2021 will be limited to 80% of the excess taxable income. The Company experienced an ownership change pursuant to IRC Sec. 382 in 2022. As a result, our NOLs carryforward as of December 31, 2022 is limited. A reconciliation between taxes computed at the federal statutory rate and the consolidated effective tax rate is as follows: 2024 2023 Federal statutory tax rate $ ( 492 ) 21.0 % 21.0 % State tax rate, net of federal tax benefit ( 8,745 ) 373.3 % 0.0 % Adjustment in valuation allowances 9,772 ( 417.1 )% 286.4 % Excess stock benefits 566 ( 24.2 )% ( 31.8 )% Interest expense accretion - 0.0 % ( 0.5 )% Permanent and other differences ( 1,132 ) 48.3 % ( 274.6 )% Benefit for income taxes $ ( 31 ) 1.3 % 0.5 % Deferred income taxes result from temporary differences between the amount of assets and liabilities recognized for financial reporting and tax purposes. The components of the net deferred income tax asset as of December 31, 2024 and 2023 are as follows (in thousands): December 31, 2024 2023 Deferred income tax assets: Net operating loss $ 167,366 $ 158,040 Share-based payment compensation 2,222 3,339 Interest expense limitation 20,901 19,547 Gain on sale of ANNOVERA ( 3,637 ) ( 3,401 ) Accrual for sales returns and coupons 670 288 R&D credit 186 186 Other, net 319 256 Deferred income tax asset 188,027 178,255 Valuation allowance ( 188,027 ) ( 178,255 ) Deferred income tax assets, net $ — $ — We believe that it is more likely than not that we will not generate sufficient future taxable income to realize a portion of tax benefits related to the deferred tax assets and as such, a valuation allowance has been established against a portion of the deferred tax assets as of both December 31, 2024 and 2023. Since our first year of operations in 2011, we generated net operating losses, and our U.S. federal and state tax returns remain open to examination. As of December 31, 2024 and 2023, we had no tax positions relating to open tax returns that were considered to be uncertain, and we had no unrecognized tax benefits. F- 26 11. Loss per common share The following table sets forth the computation of basic and diluted loss per common share for the periods presented (in thousands, except per share amounts): Years Ending December 31, 2024 2023 Numerator: Net loss from continuing operations $ ( 2,312 ) $ ( 7,699 ) Net income (loss) from discontinued operations 131 ( 2,579 ) Net loss $ ( 2,181 ) $ ( 10,278 ) Denominator: Weighted average common shares for basic income (loss) per common share 11,532 10,441 Effect of dilutive securities — — Weighted average common shares for diluted income (loss) per common share 11,532 10,441 Income (loss) per common share, continuing operations Basic $ ( 0.20 ) $ ( 0.74 ) Diluted $ ( 0.20 ) $ ( 0.74 ) Income (loss) per common share, discontinued operations Basic $ 0.01 $ ( 0.25 ) Diluted $ 0.01 $ ( 0.25 ) Since we reported a net loss from continuing operations for 2024, our potentially dilutive securities are deemed to be anti-dilutive, accordingly, there was no effect of dilutive securities. Therefore, our basic and diluted loss per common share and our basic and diluted weighted average common shares are the same for 2024. The following table sets forth the outstanding securities as of the periods presented which were not included in the calculation of diluted earnings per common share during 2024 and 2023 (in thousands): December 31, 2024 2023 Stock options 57 72 RSUs 2 40 PSUs 5 14 Warrants 98 99 162 225 12. Related parties On August 23, 2022, we appointed Mr. Justin Roberts as a director to fill a newly created vacancy on our Board of Directors. Mr. Roberts was elected to serve as a director at our combined 2022 and 2023 Annual Meeting held on June 26, 2023. Mr. Roberts will serve until our next Annual Meeting of Stockholders or until his successor is duly elected or appointed or his earlier death or resignation. As a director of our Company, Mr. Roberts is entitled to receive compensation in the same manner as our other non-employee directors, described in the section entitled “Director Compensation” in our Amendment No. 1 to Form 10-K for the fiscal year ended December 31, 2022, filed with the Securities and Exchange Commission on May 1, 2023, but he has elected not to receive any compensation for his service as a non-employee director at this time. Mr. Roberts currently serves as a Partner of Rubric. On July 29, 2022, September 30, 2022, October 28, 2022, and May 1, 2023, we entered into subscription agreements with Rubric. On December 30, 2022, in accordance with the terms of the Certificate of Designation, we redeemed all 29,000 outstanding shares of Series A Preferred Stock previously issued to affiliates of Rubric at a purchase price of $ 1,333 per share. also paid certain affiliates of Rubric approximately $ 3.0 million as a make-whole payment pursuant to the subscription agreements previously entered into between us and Rubric. On June 29, 2023, we issued and sold 312,525 shares of Common Stock to Rubric at a price per share equal to $ 3.6797 pursuant to the Subscription Agreement and received gross proceeds of $ 1.15 million, before expenses. On November 15, 2023 Rubric drew down an additional 877,192 shares of Common Stock at a price per share equal to $ 2.2761 . We received gross proceeds of $ 2.0 million from the drawdown, before expenses. There were no draw downs in 2024. F- 27 13. Business concentrations TherapeuticsMD was previously a women’s healthcare company with a mission of creating and commercializing innovative products to support the lifespan of women from pregnancy prevention through menopause. In December 2022, we changed our business to become a pharmaceutical royalty company, currently receiving royalties on products licensed to pharmaceutical organizations that possess commercial capabilities in the relevant territories. As part of the transformation that included the Mayne License Agreement, all results associated with former commercial operations have been reflected as discontinued operations in our consolidated financial statements. Assets and liabilities associated with the commercial business are classified as assets and liabilities of discontinued operations in our consolidated balance sheets. Additional disclosures regarding discontinued operations are provided in Note 2. For the year ended December 31, 2024, 100 % of license revenue is related to Mayne Pharma, Theramex and Knight. As of December 31, 2024, we had a royalty receivable of $ 3.6 million relating to the short-term portion of receivable from Mayne Pharma, Theramex and Knight and $ 16.0 million relating to the long-term portion of royalty receivable which includes royalties recognized from the minimum annual royalty that Mayne Pharma is obligated to pay to us under the Mayne License Agreement. 14. Segment Reporting The Company operates in one segment. Accordingly, the Company’s License and service revenue, Net loss, and Total assets reflect the revenue, loss, and assets of the Company’s single segment, respectively. The Company’s Chief Executive Officer is the chief operating decision maker (“CODM”). The CODM uses Net loss in assessing the performance and in determining the allocation of resources of the Company’s reportable segment. The CODM is regularly provided expense information consistent with the expense categories presented in the Company’s Consolidated Statements of Operations The following tables present total revenue of the Company by geographic location. As of December 31, 2024 2023 License and service revenue United States $ 1,123 $ 1,003 Non-U.S. 638 299 Total $ 1,761 $ 1,302 15. Subsequent Events None. F-28