What changed in this filing

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Item 1. Financial Statements

2023-08-14 compared with 2023-05-15 · 145 added, 143 removed, 352 unchanged (45% of the section changed)

4 unchanged sentences

(Unaudited – in thousands, except per share data)

March 31, 2023

June 30, 2023

December 31, 2022

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Restricted cash

Royalty receivable,

current portion

Royalty receivable, current portion

Prepaid and other current assets

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Commitments and contingencies (Note 7

Stockholders’ equity:

Preferred stock, par value $ 0.001 ;

10,000 shares authorized, no ne issued

Stockholders’ equity (deficit):

Common stock, par value $ 0.001 ;

12,000 shares authorized, 9,548 and

9,498 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively

12,000 shares authorized, 10,575

and 9,498 issued and

outstanding as of June 30, 2023 and December 31, 2022, respectively

Additional paid-in

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(Unaudited – in thousands, except per share data)

Three Months Ended March 31,

Three Months Ended

Six Months Ended

Revenue, net:

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Total operating expenses

Income (loss) from operations

Loss from operations

Other (expense) income:

Interest expense and other financing costs

Miscellaneous income

Total other income, net

Income (loss) from continuing operations before income taxes

Miscellaneous income (expense)

Total other income (loss), net

Loss from continuing operations before income taxes

Income (loss) from discontinued operations, net of income taxes

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Net income (loss)

Other comprehensive income

Other comprehensive incom e

Comprehensive income (loss):

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Balance, January 1, 2023

Shares issued for vested stock compensation and warrants

Shares issued for vested restricted stock units and warrants

Share-based compensation

Balance, March 31, 2023

Shares issued for vested restricted stock units and warrants

Shares issued for sale of common stock related to private placement sale

Share-based compensation

Balance, June 30, 2023

Balance, January 1, 2022

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Balance, March 31, 2022

Shares issued for rounding up of fractional shares in connection with the reverse stock split

Shares issued for vested restricted stock units

Shares issued for sale of common stock related to employee stock purchase plan

Share-based compensation

Balance, June 30, 2022

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

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and Subsidiaries

Condensed Consolidated Statements of Cash Flow

Condensed Consolidated Statements of Cash Flows

(Unaudited – in thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Cash flows from operating activities:

Loss from discontinued operations, net of tax

Net income (loss) from continuing operations

Adjustments to reconcile net loss to net cash used in operating activities:

Net income (loss)

income (loss) from discontinued operations, net of tax

Net loss from continuing operations

Adjustments to reconcile net loss to net cash used in continuing operating activities:

Depreciation and amortization

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Cash flows from financing activities:

Proceeds from sale of common stock, net of costs

Repayments of debt

Net cash used in continuing financing activities

Net cash (used in) provided by continuing financing activities

Discontinued operations:

Net cash used in operating activities

Net cash provided by (used in) operating activities

Net cash provided by investing activities

Net cash provided by financing activities

Net cash used in discontinued operations

Net (decrease) increase in cash

Net cash provided by (used in) discontinued operations

Net decrease in cash

Cash and restricted cash – continuing operations, beginning of period

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TherapeuticsMD, Inc.

(the “Company”), a Nevada corporation, and its condensed

consolidated subsidiaries are referred to collectively in this Quarterly Report on Form 10-Q

(the “Company”), a Nevada corporation, and its condensed consolidated subsidiaries are referred to collectively in this Quarterly Report on Form 10-Q

Report”) as “TherapeuticsMD,” “we,” “our” and “us.” This 10-Q

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, vitaCare TM

and ANNOVERA ®

are protected under applicable intellectual property laws and are the property of, or licensed by or to, us.

, 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-Q

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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, pursuant to 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 ®

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.

Pursuant to 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.

Pursuant to 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.

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.

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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 minimal 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.

Mayne Pharma will pay us minimal 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

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and royalty free license for the Licensed Products.

Pursuant to a 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”).

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 and the grant of the licenses under the Mayne Transaction 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.

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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 will be paid in accordance with their employment agreements and separation agreements as previously disclosed.

As of December 31, 2022 and March 31, 2023, we employed one

full-time employee primarily engaged in an executive position.

We have also entered into consulting agreements with certain former members of our management team who support our relationship with current partners and assist with certain financial, legal and regulatory matters and the continued wind-down of our historical business operations.

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 are paid in accordance with their employment agreements and separation agreements as previously disclosed.

As of December 31, 2022 and June 30, 2023, we employed one full-time employee primarily engaged in an executive position.

We have also entered into consulting agreements with certain former members of our management team, including our Principal Financial Officer, who support our relationship with current partners and assist with certain financial, legal, and regulatory matters and the continued wind-down of our historical business operations.

vitaCare Divestiture

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(“vitaCare”) with the sale of all of vitaCare’s issued and outstanding capital stock (the “vitaCare Divestiture”).

We received net proceeds of $ 142.6 million, after deducting

transaction costs of $ 7.2 million, and we recognized a gain on sale of business of $ 143.4 million.

We received net proceeds of $ 142.6 million, after deducting transaction costs of $ 7.2 million, and we recognized a gain on sale of business of $ 143.4 million.

Included in the net proceeds amount was $ 11.3 million of customary holdbacks as provided in the stock purchase agreement (the “Purchase Agreement”) which we received in 2023.

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In addition, under the Mayne License Agreement Amendment, Mayne Pharma will reduce one quarterly royalty payment (other than the first quarterly royalty payment) otherwise payable to us by $ 1.5 million in consideration of Mayne Pharma assuming our obligations under the long-term services agreement related to vitaCare.

The divestiture of vitaCare was determined to be a component of discontinued operations in December 2022, when we changed our business

by becoming a royalty company and as a result vitaCare activities were reclassified to discontinued operations for the three months ended March 31, 2023 and 2022.

The divestiture of vitaCare was determined to be a component of discontinued operations in December 2022, when we changed our business by becoming a royalty company and as a result vitaCare activities were reclassified to discontinued operations for the six months ended June 30, 2023 and 2022.

With multiple variant strains of the SARS-Cov-2

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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 the election of the Company.

On June 29, 2023, the Company issued and sold 312,525 shares of Common Stock at a price per share equal to $ 3.6797 pursuant to the Subscription Agreement.

The Company received gross proceeds of $ 1.15 million from the draw down, before expenses.

The Common Stock issued pursuant to the Subscription Agreement was sold and issued without registration under the Securities Act of 1933, as amended (the “Securities Act”), in reliance on the exemptions provided by Section 4(a)(2) of the Securities Act as transactions not involving a public offering and Rule 5-06

of Regulation D promulgated under the Securities Act as sales to accredited investors, and in reliance on similar exemptions under applicable state laws.

If Mayne Pharma’s sales of IMVEXXY, BIJUVA, or ANNOVERA are delayed, if the net working capital settlement with Mayne Pharma under the Transaction Agreement is greater than estimated, if we are unsuccessful with future financings or if the continued impact of the COVID-19

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(the “2022 10-K

As part of the transformation as a result of the Mayne Transaction, historical results of commercial operations for all periods prior to the Closing Date have been reflected as discontinued operations in the condensed consolidated financial statements.

Assets and liabilities associated with the commercial business are classified as

assets and liabilities of discontinued operations in the condensed consolidated balance sheet.

As part of the transformation as a result of the Mayne Tran sa

ction, historical results of commercial operations for all periods prior to the Closing Date have been reflected as discontinued operations in the condensed consolidated financial statements.

Assets and liabilities associated with the commercial business are classified as assets and liabilities of discontinued operations in the condensed consolidated balance sheet.

Additional disclosures regarding discontinued operations are provided in Note 2 of the condensed consolidated financial statements.

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Report should be read in conjunction with the condensed consolidated financial statements and accompanying notes included in our 2022 10-K

Certain amounts in the condensed consolidated financial statements and accompanying notes may not add due to rounding, and all percentages have been calculated using unrounded amounts.

Certain amounts in the consolidated financial statements and accompanying notes may not add due to rounding, and all percentages have been calculated using unrounded amounts.

New accounting standards

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Common stock reverse stock split

On May 6, 2022, we completed a reverse stock split of our common stock, par value $ 0.001 per share (our “Common Stock”).

On May 6, 2022, we completed a reverse stock split of our Common Stock.

As a result, shares of our outstanding Common Stock were split at a ratio of 50-for-1

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capital have been adjusted to give effect to the Reverse Stock Split.

Increase of authorized shares

On June 26, 2023, at our combined 2022 and 2023 Annual Meeting, our stockholders approved an amendment to o

Amended and Restated Articles of Incorporation to increase the number of authorized shares of Common Stock from 12 million shares to 32 million shares.

Estimates and assumptions

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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.

We evaluate our estimates and 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.

Significant accounting policies

The significant accounting policies we use for quarterly financial reporting are disclosed in Note 1 of the accompanying notes to the condensed consolidated financial statements included in our 2022 10-K

The significant accounting policies we use for quarterly financial reporting are disclosed in Note 1 of the accompanying notes to the consolidated financial statements included in our 2022 10-K

report and in the section below.

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This plan represented a strategic shift having a major effect on our operations and financial results.

Upon the completion of our restructuring and ultimate 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 condensed consolidated statements of operations for all periods presented.

We have no t allocated any amounts for shared general and administrative operating support expense to discontinued operations.

As required by the terms of the Financing Agreement, the proceeds from both transactions were used to fully repay our outstanding debt borrowings, and 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 (as disclosed below).

Additionally, the related assets and liabilities have been reported as assets and liabilities of discontinued operations in our condensed consolidated balance sheets as of March 31, 3023 and December 31, 2022.

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 condensed consolidated statements of operations for all periods presented.

no t allocated

any amounts for shared general and administrative operating support expense to discontinued operations.

As required by the terms of the Financing Agreement, proceeds from the Mayne Transaction and the VitaCare Divestiture were used to fully repay our outstanding debt borrowings, and 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 (as

disclosed below).

, the related assets and liabilities have been reported as assets and liabilities of discontinued operations in our condensed consolidated balance sheets as of June 30, 3023 and December 31, 2022.

The total consideration from Mayne Pharma consisted of (i) a cash payment of $ 140.0 million at closing, (ii) a cash payment of $ 12.1 million for the acquisition of net working capital subject to certain adjustments, (iii) a cash payment of approximately $ 1.0 million for prepaid royalties in connection with the Mayne License Agreement Amendment and (iv) the right to receive the contingent consideration set forth in the Mayne License Agreement, as amended.

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We believe that our estimate of net working capital is reasonable and intend to resolve this matter through the process outlined in the Transaction Agreement.

Given the recent receipt of Mayne Pharma’s calculation and the nature of the estimates involved, the outcome of this matter is uncertain at this point.

Given the nature of the estimates involved, the outcome of this matter is uncertain at this point.

As a result, we cannot reasonably estimate a range of loss, and accordingly, continue to contemplate any additional liability associated with Mayne Pharma’s calculation.

The following table presents results of discontinued operations (in thousands):

Three months ended March, 31

Three months ended June, 30

Six Months Ended June 30,

Product revenue, net

Cost of goods sold

Gross profit (loss)

Operating expenses:

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Research and development

Depreciation and amortization

Depreciation & a

Total operating expenses

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Net income (loss) from discontinued operations

The following table presents the carrying amounts of the classes of assets and liabilities of discontinued operations as of March 31, 2023 and December 31, 2022 (in thousands):

March 31, 2023

The following table presents the carrying amounts of the classes of assets and liabilities of discontinued operations as of June 30, 2023 and December 31, 2022 (in thousands):

June 30, 2023

December 31, 2022

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Prepaid and other current assets

Our prepaid and other current assets consisted of the following as of March 31, 2023 and December 31, 2022 (in thousands):

March 31, 2023

Our prepaid and other current assets consisted of the following as of June 30, 2023 and December 31, 2022 (in thousands):

June 30, 2023

December 31, 2022

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Prepaid and other current assets

Our fixed assets, net consisted of the following as of March 31, 2023 and December 31, 2022 (in thousands):

March 31, 2023

Our fixed assets, net consisted of the following as of June 30, 2023 and December 31, 2022 (in thousands):

June 30, 2023

December 31, 2022

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Fixed assets, net

We recorded, in continuing operations, depreciation expense of $ 0.0 million and $ 0.1 million for the three months ended March 31, 2023 and 2022, respectively.

We recorded, in continuing operations, depreciation expense of $ 0.0 million and $ 0.2 million for the three months ended June 30, 2023 and 2022, respectively, and depreciation expense of $ 0.0 million and $ 0.3 million for the six months ended June 30, 2023 and 2022, respectively.

Licensed rights and other intangible assets

The following provides information about our license rights and other intangible assets, net as of March 31, 2023 and December 31, 2022 (in thousands):

March 31, 2023

The following provides information about our license rights and other intangible assets, net as of June 30, 2023 and December 31, 2022 (in thousands):

June 30, 2023

December 31, 2022

Gross Carrying

Intangible assets subject to amortization:

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License rights and other intangible assets, net

We recorded, in continuing operations, amortization expense related to patents of $ 0.0 million and $ 0.2 million respectively, for the three months ended March 31, 2023 and 2022.

We recorded, in continuing operations, amortization expense related to patents of $ 0.1 million and $ 0.1 million for the three months ended June 30, 2023 and 2022 respectively, and amortization expense related to patents of $ 0.1 million and $ 0.3 million for the six months ended June 30, 2023 and 2022 respectively.

Our intangible assets subject to amortization are expected to be amortized as follows (in thousands):

Year ending December 31,

Accrued expenses and other current liabilities

Other accrued expenses and other current liabilities consisted of the following (in thousands):

March 31, 2023

June 30, 2023

December 31, 2022

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Mayne Pharma Agreement

Mayne Pharma paid us approximately $ 12.1 million at closing on December 30, 2022, for the acquisition of net working capital, as determined in accordance with the Transaction Agreement, and is subject to certain adjustments for a period of up to two years following the Closing Date.

is subject to certain adjustments for a period of up to two years following the Closing Date.

Pursuant to the Mayne License Agreement Amendment, Mayne Pharma also paid us approximately $ 1.0 million in prepaid royalties on the Closing Date.

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In addition, Mayne Pharma will reduce one quarterly royalty payment (other than the first quarterly royalty payment) otherwise payable to us by $ 1.5 million in consideration of Mayne Pharma assuming our obligations under a long-term services agreement, including our minimum payment obligations thereunder.

We received 0.1 million in royalty payments from Mayne Pharma during the three months ended March 31, 2023.

We recognized

$ 0.4 million and $ 0.9 million in royalty revenues

from Mayne Pharma during the three and six months ended June 30, 2023, respectively.

Population Council License Agreement

Under the terms of our license agreement with the Population Council, Inc.

(the “Population Council License Agreement”), we paid the Population Council a milestone payment of $ 20.0 million in 2018, which was within 30 days following the approval by the FDA of the N

ation (“NDA”) for ANNOVERA, and $ 20.0 million in 2019 following the first commercial batch release of ANNOVERA.

(the “Population Council License Agreement”), we paid the Population Council a milestone payment of $ 20.0 million in 2018, which was within 30 days following the approval by the FDA of the New Drug Application (“NDA”) for ANNOVERA, and $ 20.0 million in 2019 following the first commercial batch release of ANNOVERA.

The aggregate $ 40.0 million of milestone payments were recorded as license rights.

The Population Council was also eligible to receive future payments upon the achievement of certain commercial sales milestones of ANNOVERA.

On December 30, 2

022, we assigned the ANNOVERA license to Mayne Pharma.

On December 30, 2022, we assigned the ANNOVERA license to Mayne Pharma.

Our rights and obligations under the Population Council License Agreement have been transferred to Mayne Pharma and may revert back to us upon the occurrence of certain events.

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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.

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.

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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.

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.

The length of the stay of the IMVEXXY litigation is dependent on further action by Teva.

We have incurred and recorded legal costs amounting to $ 0.1 million in prepaid expenses and other current assets as of March 31, 2023, for the IMVEXXY Paragraph IV legal proceeding since we believe that we will successfully prevail in this legal proceeding.

We have incurred and recorded legal costs amounting to $ 2.3 million in prepaid expenses and other current assets as of June 30, 2023, 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 condensed consolidated balance sheets, and such costs will be amortized over the remaining useful life of the patents.

If we are 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 March 2020, we received a Paragraph IV certification notice letter (the “BIJUVA Notice Letter”) regarding an ANDA submitted to the FDA by Amneal Pharmaceuticals (“Amneal”).

In April 2020, we filed a complaint for patent infringement against Amneal in the United States District Court for the District of New Jersey arising from Amneal’s ANDA filing with the FDA.

In December 2021, we entered into a settlement agreement (the “Settlement Agreement”) with Amneal Pharmaceuticals, Inc., Amneal Pharmaceuticals, LLC and Amneal Pharmaceuticals of New York LLC (collectively “Amneal”) to resolve the litigation over our patents listed in the FDA’s Orange Book that claim compositions and methods of BIJUVA (the “BIJUVA Patents”).

Under the terms of the Settlement Agreement, the parties filed a consent judgment with the U.S.

District Court for the District of New Jersey that enjoins Amneal from marketing a generic version of BIJUVA (1 mg estradiol and 100 mg progesterone) before the expiration of the patents-in-suit,

except as provided in the Settlement Agreement, and we granted Amneal a non-exclusive,

non-transferable,

royalty-free license to commercialize Amneal’s generic formulation of BIJUVA in the U.S.

commencing in May 2032 (180 days before the current expiration date in November 2032 for the last to expire of our BIJUVA Patents), or earlier under certain circumstances customary for settlement agreements of this nature.

Beginning on December 30, 2022 and per the Mayne License Agreement, Mayne Pharma is responsible for all enforcement of our patents, including the litigation discussed above with respect to Teva.

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We are currently not involved in any other litigations and proceedings that we believe would have a material effect on our condensed consolidated financial condition, results of operations, or cash flows.

Compliance with Nasdaq’s continued listing requirements

In January 2023, we received a deficiency letter (the “Notice”) from the Listing Qualifications Department of the Nasdaq Stock Market, LLC (“Nasdaq”) notifying us that we were not in compliance with the rules for continued listing as set forth in Nasdaq Listing Rule 5620(a) (the “Annual Meeting Rule”) due to our failure to hold an annual meeting of stockholders within 12 months after our fiscal year ended December 31, 2021.

The Notice had

no immediate effect on the listing of our Common Stock.

We did not hold an annual meeting of stockholders during 2022 due to our then ongoing strategic processes.

The Notice stated that, under Nasdaq Listing Rule 5810(c)(2)(G), we had 45 calendar days, or until February 20, 2023, to submit a plan to regain compliance with the Annual Meeting Rule.

We timely submitted such plan, and Nasdaq granted us an extension until June 29, 2023, to regain compliance.

We have announced an annual meeting of stockholders to be held on June 26, 2023 which we expect will cause us to fully regain compliance with all applicable Nasdaq listing standards.

sheet arrangements

As of March 31, 2023 and December 31, 2022 we had no off-balance

As of June 30, 2023 and December 31, 2022 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 are material to investors.

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Severance obligations for all employees other than executive officers were paid in full in the first quarter of 2023.

As of March 31, 2023, we employ one full-time employee primarily engaged in an executive position.

As of June 30, 2023, we employ one full-time employee primarily engaged in an executive position.

We have engaged external consultants, including certain former members of our management team, who support our relationship with current partners and assist with certain financial, legal, and regulatory matters and the continued wind-down of our historical business operations.

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Executive Officers, former Interim Chief Financial Officer and other executives from TherapeuticsMD was each a termination without “Good Cause,” as defined in their respective employment agreements.

In the aggregate, as of March 31, 2023, we have accrued severance liabilities for executive termination obligations of $ 3.5 million.

In the aggregate, as of June 30, 2023, we have accrued severance liabilities for executive termination obligations of $ 2.4 million.

Stockholders’ equity (deficit)

As of March 31, 2023, 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):

As of June 30, 2023, 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

Weighted Average

Exercise Price

Intrinsic Value

Aggregate Intrinsic Value

Weighted Average

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As of January 1, 2023

As of March 31, 2023

As of June 30, 2023

Share-based compensation payment plans

As of March 31, 2023, 559,661 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).

If we assume the maximum achievement of performance goals for PSUs, then 591,661 shares of common stock will be subject to outstanding awards under our share-based payment award plans and inducement grants.

As of March 31, 2023, 300,232 shares of common stock were available for future grants of share-based payment awards under the TherapeuticsMD, Inc.

As of June 30, 2023, 269,207 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 June 30, 2023,

321,717 shares of common stock were available for future grants of share-based payment awards under the TherapeuticsMD, Inc.

2019 Stock Incentive Plan.

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Cancelled/Forfeited

As of March 31, 2023

As of June 30, 2023

The following table summarizes the status of our RSUs and related transactions (each adjusted to account for the Reverse Stock Split) since December 31, 2022 (in thousands, except weighed average grant date fair value):

RSUs awards outstanding

RSUs awards vested and not settled

RSUs awards vested and not

As of January 1, 2023

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Cancelled/Forfeited

As of March 31, 2023

The following table summarizes the status of our PSU and related transactions for each for the following years (each adjusted to account for the Reverse Stock Split) since December 31, 2022 (in thousands, except weighed average grant date fair value):

As of June 30, 2023

The following table summarizes the status of our PSUs and related transactions for each for the following years (each adjusted to account for the Reverse Stock Split) since December 31, 2022 (in thousands, except weighed average grant date fair value):

Vested and not settled

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Cancelled/Forfeited

As of March 31, 2023

The number of PSUs represents the base number of PSUs that will vest.

As of June 30, 2023

The number of PSUs represents the base number of PSUs that may

Share-based payment compensation cost

Share-based payment compensation expense for PSUs is based on 100 % vesting which was a part of termination of 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 ESPP totaling $ 0.5 million and $ 2.1 million for the three months ended March 31, 2023 and 2022 respectively.

As of March 31, 2023, we had $ 0.8 million 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

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 ESPP totaling $ 0.4 million and $ 2.2 million for the three months ended June 30, 2023 and 2022 respectively, and $ 0.9 million and $ 4.3 million for the six months ended June 30, 2023 and 2022 respectively.

As of June 30, 2023, we had $ 0.5 million 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 condensed consolidated balance sheets.

No tax benefit was realized due to a continued pattern of net losses.

The unrecognized compensation cost as of March 31, 2023, of $ 0.8 million is expected to be recognized as share-based payment award compensation over a weighted average period of 1.1 years.

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.

The unrecognized compensation cost as of June 30, 2023 of $ 0.5 million is expected to be recognized as share-based payment award compensation over a weighted average period of 0.6 years.

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,

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and royalty free license for the Licensed Products.

We do not expect to pay any significant federal or state income taxes as a result of (i) the losses recorded during the three months ended March 31, 2023 and 2022, (ii) additional losses expected for the remainder of 2023 or losses recorded in 2022, or (iii) net operating losses carry forwards from prior years.

We recorded a full valuation allowance of the net operating losses for the three months ended March 31, 2023 and 2022.

Accordingly, there were no provisions for income taxes for the three months ended March 31, 2023 and 2022.

Additionally, as of March 31, 2023 and December 31, 2022, we maintain a full valuation allowance for all deferred tax assets.

We do not expect to pay any significant federal or state income taxes as a result of (i) the losses recorded during the six months ended June 30, 2023 and 2022, (ii) additional losses expected for the remainder of 2023 or losses recorded in 2022, or (iii) net operating losses carry forwards from prior years.

We recorded a full valuation allowance of the net operating losses for the six months ended June 30, 2023 and 2022.

Accordingly, there were no provisions for income taxes for the six months ended June 30, 2023 and 2022.

Additionally, as of June 30, 2023 and December 31, 2022, we maintain a full valuation allowance for all deferred tax assets.

Loss per common share

The following table sets forth the computation of basic and diluted loss per common share (each adjusted to account for the Reverse Stock Split) for the periods presented (in thousands, except per share amounts):

Three Months Ended March 31,

Three Months Ended

Six Months Ended

Net income (loss) from continuing operations

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Income (loss) per common share, discontinued operations

Since we reported a net loss for the three months ended March 31, 2023 and 2022, 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 share are the same for the three months ended March 31, 2023 and 2022.

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 the respective three months ended March 31, 2023 and 2022 (in thousands):

As of March 31,

Since we reported a net loss from continuing operations for the six months ended June 30, 2023 and 2022, 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 the six months ended June 30, 2023 and 2022.

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 the respective six months ended June 30, 2023 and 2022 (in thousands):

Six Months Ended June 30,

Stock options

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Justin Roberts as a director to fill a newly created vacancy on our Board of Directors.

Roberts will serve until our 2023 Annual Meeting of Stockholders or until his successor is duly elected or appointed or his earlier death or resignation and has been nominated for reelection at the 2023 Annual Meeting of Stockholders.

Roberts was elected to serve as a director at our combined 2022 and 2023 Annual Meeting held on June 2

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

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.

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

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.

Roberts currently serves as a Partner of Rubric Capital Management LP (“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.

We 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.

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.

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, the Company 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.

Business concentrations

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Additional disclosures regarding discontinued operations are provided in Note 2.

For the three months ended March 31, 2023, 100 % of

license revenue related to Mayne Pharma and Theramex.

As of March 31, 2023, we had a royalty receivable of $ 2.0 million relating to the short-term portion of receivable from Mayne Pharma and Theramex

and $ 20.3 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.

As of March 31, 2023, we also recorded $ 1.1 million in prepaid royalties that we received from Mayne Pharma which were recorded in accrued expenses and other current liabilities.

For the three and six months ended June 30, 2023, 100 % of license revenue related to Mayne Pharma and Theramex.

As of June 30, 2023, we had a royalty receivable of $ 0.8 million relating to the short-term portion of receivable from Mayne Pharma and Theramex and $ 19.8

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.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements