ANI PHARMACEUTICALS INC

Previous wording

Please read the following discussion in conjunction with Item 1A. (“Risk Factors”) and our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K. Some of the statements in the following discussion are forward-looking statements. See the discussion about forward-looking statements on page 1 of this Annual Report on Form 10-K.

Current wording

Please read the following discussion in conjunction with Item 1A. (“Risk Factors”) and our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K. Some of the statements in the following discussion are forward-looking statements. See the discussion about forward-looking statements on page 1 of this Annual Report on Form 10-K, as actual results may differ materially from those contained in any forward-looking statements.

Previous wording

This section of this Form 10-K generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023. Discussions of 2022 items and year-to-year comparisons between 2023 and 2022 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 29, 2024.

Current wording

This section generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024. Discussions of 2024 items and year-to-year comparisons between 2024 and 2023 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on February 28, 2025.

Previous wording

ANI Pharmaceuticals, Inc. and its consolidated subsidiaries (together, “ANI,” the “Company,” “we,” “us,” or “our”) is a diversified bio-pharmaceutical company committed to its mission of “Serving Patients, Improving Lives” by developing, manufacturing, and commercializing innovative and high quality therapeutics.

Current wording

ANI Pharmaceuticals is a diversified bio-pharmaceutical company. The Company's mission is “Serving Patients, Improving Lives” by developing, manufacturing, and commercializing therapeutics through its Rare Disease, Generics, and Brands businesses.

Previous wording

On September 16, 2024, the Company completed its previously announced acquisition of Alimera Sciences, Inc., a Delaware corporation, pursuant to the terms of the Agreement and Plan of Merger, dated as of June 21, 2024 (the “Merger Agreement”), by and among the Company, Alimera and ANIP Merger Sub INC., a Delaware corporation and wholly-owned subsidiary of the Company (“Merger Sub”). Pursuant to the Merger Agreement, Merger Sub merged with and into Alimera, with Alimera surviving the merger as a wholly-owned subsidiary of the Company (the “Merger”). In connection with the Merger, the Company added a growing and durable franchise, ILUVIEN® (fluocinolone acetonide intravitreal implant) 0.19 mg, which has received marketing authorization and reimbursement in the United States (“U.S.”) and 24 countries for the treatment of diabetic macular edema (“DME”) and YUTIQ® (fluocinolone acetonide intravitreal implant) 0.18 mg, available in the U.S. for the treatment of non-infectious uveitis affecting the posterior segment of the eye (“NIU-PS”). In connection with the acquisition of Alimera, the Company has assessed its strategic goals and aligned its operational initiatives into two reportable segments, and the discussion of the historical results of operations below has been revised, as applicable, to be consistent with the presentation of the revised reportable segments (see Note 19 "Segment Reporting in the notes to the consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K).

Current wording

On September 16, 2024, the Company acquired Alimera. In connection with the Merger, the Company addeda growing and durable franchise, ILUVIEN® (fluocinolone acetonide intravitreal implant) 0.19 mg, which has received marketing authorization and reimbursement in the United States (“U.S.”) and 24 countries for the treatment of diabetic macular edema (“DME”) and YUTIQ® (fluocinolone acetonide intravitreal implant) 0.18 mg, available in the U.S. for the treatment of non-infectious uveitis affecting the posterior segment of the eye (“NIU-PS”). Subsequent to the acquisition of Alimera, we expanded the label for ILUVIEN to include an indication for chronic NIU-PS in addition to its then-current indication in DME in the U.S.

Previous wording

Our three pharmaceutical manufacturing facilities, of which two are located in Baudette, Minnesota, and one is located in East Windsor, New Jersey, are together capable of producing oral solid dose products, as well as semi-solids, liquids and topicals, controlled substances, and potent products that must be manufactured in a fully-contained environment. We ceased operations at our subsidiary in Oakville, Ontario, Canada as of March 31, 2023. This action was part of ongoing initiatives to capture operational synergies following our acquisition of Novitium Pharma LLC (“Novitium”) in November 2021. We have fully completed the transition of the products manufactured or packaged in Oakville to one of our three U.S. based manufacturing sites. In February 2024, our Canadian subsidiary entered into an agreement for the purchase and sale of the Oakville site, for a purchase price of $19.2 million Canadian Dollars, or approximately $14.2 million, based on the current exchange rate. The sale closed on March 28, 2024 (see Note 4 "Restructuring Canada Operations" in the notes to the consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K).

Current wording

The Company owns and operates three pharmaceutical manufacturing facilities, including two facilities in Baudette, Minnesota, and one in East Windsor, New Jersey, which collectively are capable of producing oral solid dose products, as well as semi-solids, liquids and topicals, controlled substances, and potent products that must be manufactured in a fully-contained environment. The Company ceased operations at another manufacturing facility in Oakville, Ontario as of March 31, 2023. In February 2024, our Canadian subsidiary entered into an agreement for the purchase and sale of the Oakville site, for a purchase price of $19.2 million Canadian Dollars, or approximately $14.2 million, based on the then-current exchange rate. The sale closed on March 28, 2024. See Note 4 "Restructuring Canada Operations" in the notes to the consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K.

Previous wording

On August 13, 2024, the Company entered into a credit agreement with JPMorgan Chase Bank, N.A., as administrative agent, and the financial institutions party thereto as lenders, (the "New Credit Agreement") which provides for aggregate principal commitments consisting of (i) a senior secured delayed-draw term loan facility in an aggregate principal amount of $325.0 million, and (ii) a senior secured revolving credit facility in an aggregate commitment amount of $75.0 million, which may be used for revolving credit loans, swingline loans and letters of credit.

Current wording

On August 13, 2024, the Company entered into a credit agreement with JPMorgan Chase Bank, N.A., as administrative agent, and the financial institutions party thereto as lenders (the "2024 Credit Agreement"), which provides for aggregate principal commitments consisting of (i) a senior secured delayed-draw term loan facility in an aggregate principal amount of $325.0 million, and (ii) a senior secured revolving credit facility in an aggregate commitment amount of $75.0 million ($74.9 million of which remains undrawn), which may be used for revolving credit loans, swingline loans and letters of credit.

Previous wording

On August 13, 2024, the Company completed an offering of $316.25 million aggregate principal amount of the Company's Convertible Senior Notes due 2029 (the “Notes”). The Notes are due September 1, 2029, unless earlier repurchased, redeemed, or converted. After deducting the initial purchasers’ discounts and commissions of approximately $9.5 million, but before deducting the Company’s offering expenses, the net proceeds to the Company from the offering of the Notes was approximately $306.8 million. In connection with the offering of Notes, on August 7, 2024 and August 8, 2024, the Company entered into capped call transactions with certain financial institutions (“Capped Calls”). After payment of the cost of entering into the Capped Calls transactions, of approximately $40.6 million, the Company used the remainder of the net proceeds from the Notes offering, together with cash on hand, to repay the Company’s existing senior secured credit agreement with Truist Bank, dated as of November 19, 2021.

Current wording

On August 13, 2024, the Company completed an offering of $316.25 million aggregate principal amount of the Company's Convertible Senior Notes due 2029 (the “Notes”). The Notes are due September 1, 2029, unless earlier repurchased, redeemed, or converted. After deducting the initial purchasers’ discounts and commissions of approximately $9.5 million, but before deducting the Company’s offering expenses, the net proceeds to the Company from the offering of the Notes were approximately $306.8 million. In connection with the offering of Notes, on August 7, 2024 and August 8, 2024, the Company entered into capped call transactions with certain financial institutions (“Capped Calls”). After payment of the cost of entering into the Capped Calls transactions, of approximately $40.6 million, the Company used the remainder of the net proceeds from the Notes offering, together with cash on hand, to repay the Company’s existing senior secured credit agreement with Truist Bank, dated as of November 19, 2021.

Previous wording

On September 16, 2024, ANI drew the full $325.0 million of New Credit Agreement principal, with proceeds used to finance the acquisition of Alimera, including fees, costs and expenses incurred in connection with the acquisition. As of December 31, 2024, the revolving credit facility remains undrawn, and $75.0 million is available for borrowing, subject to the satisfaction of certain conditions. The New Credit Agreement and the revolving credit facility mature on September 16, 2029.

Current wording

On September 16, 2024, ANI drew the full $325.0 million of principal under the 2024 Credit Agreement, with proceeds used to finance the acquisition of Alimera, including fees, costs and expenses incurred in connection with the acquisition. As of December 31, 2025, the revolving credit facility remains undrawn, and$74.9 millionis available for borrowing, subject to the satisfaction of certain conditions. The 2024 Credit Agreement and the revolving credit facility mature on September 16, 2029.

Previous wording

On September 16, 2024, the Company completed our previously announced merger with Alimera (the “Closing”). At the effective time of the Merger (the “Effective Time”), each share of common stock, par value $0.01 per share, of Alimera (the “Alimera Common Stock”) outstanding immediately prior to the Effective Time including each Alimera RSA, Alimera PSU, Alimera RSU, and Alimera Warrant (as defined below), but excluding any treasury shares or shares owned by the Company, Merger Subs or any other subsidiary of the Company or Alimera), was canceled and ceased to exist and was converted into the right to receive (i) $5.50 in cash (“Closing Cash Consideration”), and (ii) one contingent value right (a “CVR”), which represents the right to receive the milestone payments (as defined below) subject to the terms and conditions set forth in the CVR Agreement entered into on September 16, 2024 (clauses (i) and (ii) collectively, the “Merger Consideration”). The Company also repaid $72.5 million of Alimera debt.

Current wording

At the effective time of the Merger (the “Effective Time”), each share of common stock, par value $0.01 per share, of Alimera (the “Alimera Common Stock”) outstanding immediately prior to the Effective Time including each Alimera RSA, Alimera PSU, Alimera RSU, and Alimera Warrant (each as defined below), but excluding any treasury shares or shares owned by the Company, merger subsidiaries or any other subsidiary of the Company or Alimera), was canceled and ceased to exist and was converted into the right to receive (i) $5.50 in cash (“Closing Cash Consideration”), and (ii) one contingent value right (a “CVR”), which represents the right to receive the milestone payments subject to the terms and conditions set forth in the CVR Agreement entered into on September 16, 2024 (clauses (i) and (ii) collectively, the “Merger Consideration”). The Company also repaid $72.5 million of Alimera debt.

Previous wording

Each CVR entitles the holder to receive milestone payments for 2026 and 2027. The milestone payments for each CVR equals the product (rounded to the nearest 1/100 of $0.01) of $0.25 multiplied by a fraction (which is no case will exceed one), and (i) for 2026, equals the amount, if any, by which the 2026 Net Revenue exceeds $140.0 million, divided by $10.0 million (subject to adjustment for the exercise price of eligible options), and (ii) for 2027, equals the amount, if any, by which the 2027 Net Revenue exceeds $160.0 million, divided by $15.0 million (subject to adjustment for the exercise price of applicable Alimera Options).

Current wording

Each CVR entitles the holder to receive milestone payments for 2026 and 2027. The milestone payments for each CVR equals the product (rounded to the nearest 1/100 of $0.01) of $0.25 multiplied by a fraction (which is no case will exceed one), and (i) for 2026, equals the amount, if any, by which the 2026 Net Revenue (as defined therein) exceeds $140.0 million, divided by $10.0 million (subject to adjustment for the exercise price of eligible options), and (ii) for 2027, equals the amount, if any, by which the 2027 Net Revenue exceeds $160.0 million, divided by $15.0 million (subject to adjustment for the exercise price of applicable Alimera Options).

Previous wording

In addition to the amounts payable to the holders thereof in connection with the Closing, all of the outstanding awards of restricted stock with respect to shares of Alimera Common Stock (each, an “Alimera RSA”), each Alimera Performance Stock Unit (“Alimera PSU”), each Alimera Restricted Stock Unit (“Alimera RSU”) and each Alimera Warrant that were outstanding immediately prior to the Effective Time were automatically canceled and converted into the right to receive one (1) CVR per share of Alimera Common Stock then underlying the applicable instrument.

Current wording

In addition to the amounts payable to the holders thereof in connection with the Merger, all of the outstanding awards of restricted stock with respect to shares of Alimera Common Stock (each, an “Alimera RSA”), each Alimera Performance Stock Unit (“Alimera PSU”), each Alimera Restricted Stock Unit (“Alimera RSU”) and each Alimera warrant ("Alimera Warrant") that were outstanding immediately prior to the Effective Time were automatically canceled and converted into the right to receive one (1) CVR per share of Alimera Common Stock then underlying the applicable instrument.

Previous wording

Each stock option previously granted by Alimera to purchase Alimera Common Stock (each, an “Alimera Option”) that was outstanding and unexercised as of the Effective Time and which had a per share exercise price that was less than the Closing Cash Consideration was, in addition to the amounts payable to the holders thereof in connection with the Closing, automatically canceled and converted into the right to receive one (1) CVR per share of Alimera Common Stock then underlying such Alimera Option. No other Alimera Options were cancelled and converted into the right to receive a CVR, provided that each Alimera Option with a per share exercise price greater than or equal to the Closing Cash Consideration but less than the Total Consideration (as defined in the Merger Agreement) may receive a payment in connection with the payout of the CVRs (if any).

Current wording

Each stock option previously granted by Alimera to purchase Alimera Common Stock (each, an “Alimera Option”) that was outstanding and unexercised as of the Effective Time and which had a per share exercise price that was less than the Closing Cash Consideration was, in addition to the amounts payable to the holders thereof in connection with the Closing, automatically canceled and converted into the right to receive one (1) CVR per share of Alimera Common Stock then underlying such Alimera Option. No other Alimera Options were cancelled and converted into the right to receive a CVR, provided that each Alimera Option with a per share exercise price greater than or equal to the Closing Cash Consideration but less than the Total Consideration (as defined in the Merger Agreement) may receive a payment in connection with the payout of the CVRs (if any). See Note 3 “Business Combination” to the notes to the consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K for further information on the acquisition.

Previous wording

Refer to the Liquidity and Capital Resources below for further discussion of changes to our capital structure during 2024.

Current wording

Refer to the Liquidity and Capital Resources below for further discussion of changes to our capital structure during 2025 and 2024.

Previous wording

We derive substantially all of our revenues from sales of rare disease, brands portfolio of pharmaceutical products, generics, and other sources of revenue such as royalties on net sales of certain products, and other pharmaceutical services. Essentially all of our generic products face competition from other generic products, as do many of our brands products, and we expect them to continue to face competition from generic products in the future. The primary means of competition among generic manufacturers are pricing, contract terms, service levels, and reliability. Increased competition generally results in decreased average selling prices of generic and brands products over time. In addition, due to strategic partnerships between wholesalers and pharmacy chains, we have experienced, and expect to continue to experience, increases in net sales to the wholesalers, with corresponding decreases in net sales to the pharmacy chains.

Current wording

We derive substantially all of our revenues from sales of our Rare Disease, Brands and Generics portfolios of pharmaceutical products, as well as from other sources of revenue such as royalties on net sales of certain products, and other pharmaceutical services. Essentially all of our Generics products face competition from other generic products, as do many of our Brands products, and we expect them to continue to face competition from generic products in the future. The primary means of competition among generic manufacturers are pricing, contract terms, service levels, and reliability. Increased competition generally results in decreased average selling prices of generic and brands products over time. In addition, due to strategic partnerships between wholesalers and pharmacy chains, we have experienced, and expect to continue to experience, increases in net sales to the wholesalers, with corresponding decreases in net sales to the pharmacy chains.

Previous wording

Net revenues for the year ended December 31, 2024 were $614.4 million compared to $486.8 million for the same period in 2023, an increase of $127.6 million, or 26.2%, primarily as a result of the following:

Current wording

Net revenues for the year ended December 31, 2025 were $883.4 million compared to $614.4 million for the same period in 2024, an increase of $269.0 million, or 43.8%, primarily as a result of the following:

Previous wording

•Net revenues from Rare Disease and Brands, includes rare disease and brands portfolio of pharmaceutical products was $294.3 million during the year ended December 31, 2024, an increase of $96.8 million, compared to $197.5 million, for the same period in 2023.

Current wording

•Net revenues from Rare Disease and Brands, which includes our rare disease and brands portfolios of pharmaceutical products, was $484.0 million during the year ended December 31, 2025, an increase of $189.6 million, compared to $294.3 million for the same period in 2024.

Previous wording

•Net revenues for rare disease pharmaceutical products, include Cortrophin Gel and a full quarter contribution from ILUVIEN and YUTIQ, were $229.6 million during the year ended December 31, 2024, an increase of $117.5 million from $112.1 million for the same period in 2023. This increase was driven by increased volume in this third year of launch of Cortrophin Gel (product was launched in late January 2022) from overall ACTH market growth and share growth, and a full quarter of sales from ILUVIEN and YUTIQ, as a result of the acquisition of Alimera on September 16, 2024.

Current wording

•Net revenues for Rare Disease pharmaceutical products were $422.6 million during the year ended December 31, 2025, an increase of $193.0 million from $229.6 million for the same period in 2024. This increase was driven by increased volume of Cortrophin Gel from overall ACTH market growth and market share gains, and a full year of sales from ILUVIEN and YUTIQ. ILUVIEN and YUTIQ were acquired from Alimera in September 2024.

Previous wording

•Net revenues for generic and other pharmaceutical products were $320.0 million during the year ended December 31, 2024, an increase of 10.6%compared to$289.3 million for the same period in 2023, primarily a result of the following:

Current wording

•Net revenues for Generic and Other pharmaceutical products were $399.4 million during the year ended December 31, 2025, an increase of 24.8% compared to $320.0 million for the same period in 2024, primarily as a result of the following:

Previous wording

•Generic pharmaceutical products net revenues were $301.0 million during the year ended December 31, 2024, an increase of $31.6 million over the prior year. This increase was driven by increased volumes on the base business, increased volumes from the full year benefit of 2023 launches in 2024 and 2024 new product launches. The Company launched a total of 17 new products in 2024. From a product perspective, the increase was principally driven by revenues from year over year increases in products such as Baclofen OS, Candesartan, Colestipol, Estradiol, Ketoconazole, L-Glutamine, Pentoxyifylline, Pirfenidone, Prednisone, Vancomycin, among others.

Current wording

•Generic pharmaceutical products net revenues were $384.1 million during the year ended December 31, 2025, an increase of $83.1 million over the prior year. This increase was driven by the December 2024 launch of Prucalopride Tablets, which included CGT designation and corresponding 180 day exclusivity that expired in late June 2025, increased volumes from the benefit of new product launches during 2025, inclusive of a partnered generic product launched in Q3 2025, along with annualization of new product launches that occurred during 2024. The Company launched a total of 13 and 17 new products in 2025 and 2024, respectively. From a product perspective, in addition to the products cited above, the increase was principally driven by revenues from year over year increases in products such as Ketoconazole, Nitazoxanide, and Thyroid Tablets, among others.

Previous wording

•Net revenues from royalties and other pharmaceuticals was down modestly between December 31, 2024 and the prior year.

Current wording

•Net revenues from royalties and other pharmaceuticals were down modestly between December 31, 2025 and the prior year due to fewer contract manufacturing shipments during the current year.

Previous wording

Cost of sales consists of direct labor, including manufacturing and packaging, active and inactive pharmaceutical ingredients, freight costs, packaging components, royalties payable related to profit-sharing arrangements, and amortization of the inventory fair value step-up recognized in connection with the acquisition of Alimera. Cost of sales does not include depreciation and amortization expense, which is reported as a separate component of operating expenses on our consolidated statements of operations.

Current wording

Cost of sales consists of direct labor, including manufacturing and packaging, active and inactive pharmaceutical ingredients, freight costs, packaging components, royalties payable, and profit-sharing arrangements. Cost of sales does not include depreciation and amortization expense, which is reported as a separate component of operating expenses on our consolidated statements of operations.

Previous wording

For the year ended December 31, 2024, cost of sales increased to $250.2 million from $181.5 million for the same period in 2023, an increase of $68.7 million or 37.8%. The increase is primarily due to significant net growth in sales volumes of pharmaceutical products, significant growth of royalty bearing products, including Cortrophin Gel, and the amortization of the inventory step up related to the acquisition of Alimera of approximately $13.6 million.

Current wording

For the year ended December 31, 2025, cost of sales increased to $341.3 million from $250.2 million for the same period in 2024, an increase of $91.1 million or 36.4%. The increase is primarily due to significant net growth in sales volumes of pharmaceutical products and significant growth of royalty bearing products, including Cortrophin Gel and other products in our portfolio.

Previous wording

During the year ended December 31, 2024, 12% of our raw material inventory purchases were from one domestic supplier. During the year ended December 31, 2023, no single vendor represented at least 10% of our raw material inventory purchases. During the year ended December 31,2022 approximately 19%, of our raw material inventory purchases were from one domestic supplier.

Current wording

During the years ended December 31, 2025 and 2024, 17% and 12%, respectively, of our raw material inventory purchases were from one domestic supplier.

Previous wording

For the year ended December 31, 2024, other operating expenses increased to $363.6 million from $258.3 million for the same period in 2023, an increase of $105.3 million, or 40.7%, primarily as a result of the following factors:

Current wording

For the year ended December 31, 2025, other operating expenses, net, increased to $431.0 million from $363.6 million for the same period in 2024, an increase of $67.4 million, or 18.5%, primarily as a result of the following factors:

Previous wording

•Research and development expenses increased from $34.3 million to $44.6 million, an increase of 30.0%, primarily due to a higher level of activity associated with ongoing and new projects, including expenses related to the New Day and Synchronicity clinical trials during the year ended December 31, 2024.

Current wording

•Research and development expenses increased from $44.6 million to $51.7 million, an increase of 15.9%, primarily due to a higher level of activity associated with ongoing and new projects to support future growth of our Generics and Rare Disease portfolios. Generics and Rare Disease expenses increased by approximately $6.0 million and $0.8 million, respectively, as compared to the year ended December 31, 2024.

Previous wording

•Selling, general, and administrative expenses increased from $161.7 million to $249.6 million, an increase of 54.4%, due to increased employment related costs, including incentive based compensation tied to record 2024 financial performance, investment in Rare Disease sales and marketing infrastructure and activities, legal expenses, transaction and integration expenses related to the acquisition of Alimera of approximately $18.2 million, severance expense of approximately $5.3 million and the settlement of all outstanding equity awards held by Alimera employees of approximately $9.2 million, and an overall increase in activities to support revenue growth in our Rare Disease and Brands segment.

Current wording

•Selling, general, and administrative expenses increased from $249.6 million to $317.7 million, an increase of 27.3%, due to increased employment related costs, investmentin Rare Disease sales and marketing infrastructure (including our new, larger ophthalmology sales and marketing team) and activities, legal expenses, and an overall increase in activities to support the growth of our business during the year ended December 31, 2025; offset by a decrease of approximately $16.0 million related to transaction and integration costs for the acquisition of Alimera, and $15.4 million related to severance and equity payments to former Alimera employees incurred during the year ended December 31, 2024, which did not recur during the year ended December 31, 2025.

Previous wording

•Depreciation and amortization expense was $67.7 million for the year ended December 31, 2024, compared to $59.8 million for the same period in 2023, an increase of approximately$7.9 million, primarily related to the amortization expense of the acquired intangible assets of ILUVIEN and YUTIQ of approximately $9.6 million. These assets were acquired on September 16, 2024 from Alimera.

Current wording

•Depreciation and amortization expense was $91.4 million for the year ended December 31, 2025, compared to $67.7 million for the same period in 2024, an increase of approximately $23.7 million, primarily related to the increase in amortization expense of the acquired intangible assets, ILUVIEN and YUTIQ. Amortization expense for these assets totaled $32.9 million for the year ended December 31, 2025 compared to a partial year of amortization expense totaling $9.6 million for the year ended December 31, 2024, an increase of approximately $23.3 million. These assets were acquired in September 2024 from Alimera.

Previous wording

•We recognized a gain related to the sale of the former Oakville, Ontario manufacturing site of approximately$5.3 million during the year ended December 31, 2024. There was no comparable sale in the year ended December 31, 2023.

Current wording

•We recognized a loss related to the disposal of certain manufacturing equipment of approximately $0.4 million during the year ended December 31, 2025, and a gain related to the sale of the former Oakville, Ontario manufacturing site of approximately $5.3 million during the year ended December 31, 2024.

Previous wording

•We recognized an impairment charge related to a portfolio of definite-lived intangible assets of $3.6 million and IPR&D of approximately $4.0 million during the three months ended December 31, 2024. There was no comparable intangible asset impairment charge in the year ended December 31, 2023.

Current wording

•We recognized an impairment charge related to one definite-lived intangible asset of approximately $0.8 million during the year ended December 31, 2025. We recognized an impairment charge related to a portfolio of definite-lived intangible assets of $3.6 million and IPR&D of approximately $4.0 million during the fourth quarter of 2024.

Previous wording

For theyear ended December 31, 2024, we recogn ized total other expense, net of $22.8 million as compared to total other expense of $27.1 million for the same period in 2023, a decrease of $4.3 million.

Current wording

For theyear ended December 31, 2025, we recognized total other expense, net of $15.3 million as compared to total other expense, net of $22.8 million for the same period in 2024, a decrease of $7.5 million.

Previous wording

•The unrealized gain on investment in equity securities of approximately$6.3 million is due to the mark to market to fair value of the equity securities held in CG Oncology as of the balance sheet date. There was nocomparable gain on investment in theyear ended December 31, 2023.

Current wording

•We recorded an unrealized gain on investment in equity securities of approximately $2.8 million for the year ended December 31, 2025, compared to an unrealized gain of $6.3 million in the same period in 2024, which is based on the mark to market fair value of equity securities held in CG Oncology as of the balance sheet date.

Previous wording

•Interest expense, for the year ended December 31, 2024 consists primarily of coupon interest expense on borrowings under our outstanding debt and amortization of deferred financings costs on these debt instruments, interest income earned on our bank balances, and interest earned on our interest rate swap. During 2023 and for the first 8 months of 2024, only the Credit Facility with Truist was outstanding, however, in Q3 2024 we entered into a New Credit Facility and Convertible Senior Notes in an aggregate principal amount of approximately $641.3 million. The decrease in interest expense, net, of $9.3 million is primarily attributable to favorable interest rates on the New Credit Facility, Convertible Notes, and favorable bank interest rates during 2024.

Current wording

•Interest expense, net, for the year ended December 31, 2025 consists primarily of coupon interest expense on borrowings under our outstanding debt and amortization of deferred financings costs on these debt instruments, interest income earned on our bank balances, and interest earned on our interest rate swap. Interest income earned on our bank balances and interest rate swaps decreased approximately $2.0 million and $1.4 million, respectively. This impact was partially offset by a decrease in interest expense related to our outstanding debt of approximately $1.1 million, compared to the prior year.

Previous wording

•Other expense, net, increased to approximately $4.0 million, primarily due to the fees paid to JPMorgan Chase Bank, N.A. and Blackstone Credit & Insurance of $2.8 million pursuant to the terms of the debt commitment letter, dated June 21, 2024, entered into in connection with the acquisition of Alimera.

Current wording

•Other income (expense), net for the years ended December 31, 2025 and 2024 consists primarily of unrealized foreign exchange gains related to our Alimera UK subsidiary. During 2024, other expense, net primarily consisted of the fees paid to JPMorgan Chase Bank, N.A. and Blackstone Credit & Insurance of $2.8 million pursuant to the terms of the debt commitment letter, dated June 21, 2024, entered into in connection with the acquisition of Alimera, in addition to foreign exchange losses.

Previous wording

•We recorded a loss on debt extinguishment of approximately $7.5 million, comprised of the write-off unamortized deferred financing fees related to the Credit Facility. On August 13, 2024, the Company entered into the 2.25% Convertible Senior Notes due 2029 (as described in Note 7 “2.25% Convertible Senior Notes” to the notes to consolidated financial statements). The proceeds of the Convertible Senior Notes were used to repay the Truist Credit Facility in its entirety, approximately$294.0 million, comprised of $292.5 million of unpaid principal,$1.2 million in accrued and unpaid interest, and$0.3 million of legal fees. There was nocomparable transaction in theyear ended December 31, 2023.

Current wording

•We recorded a loss on debt extinguishment of approximately $7.5 million, comprised of the write-off of unamortized deferred financing fees related to the Credit Facility during 2024. On August 13, 2024, the Company entered into the Notes (as described in Note 7 “2.25% Convertible Senior Notes” in the Notes to the Consolidated Financial Statements). The proceeds of the Notes were used to repay the 2021 Credit Facility in its entirety, approximately $294.0 million, comprised of $292.5 million of unpaid principal, $1.2 million in accrued and unpaid interest, and $0.3 million of legal fees. There was no comparable transaction during the year ended December 31, 2025.

Previous wording

Income tax (benefit) expense consists of current and deferred components, which include changes in our deferred tax assets, our deferred tax liabilities, and our valuation allowance. See Note 16 "Income Taxes" in the notes to the consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K for further information.

Current wording

Income tax expense (benefit) consists of current and deferred components, which include changes in our deferred tax assets, our deferred tax liabilities, and our valuation allowance. See Note 16 "Income Taxes" in the notes to the consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K for further information.

Previous wording

For the year ended December 31, 2024, we recognized an income tax benefit of approximately $3.7 million, an effective tax rate of 16.6% of pre-tax loss reported in the period, as well as the net effect of certain discrete items for the year ended December 31, 2024 which impact our income tax expense in the period in which they occur. Discrete items occurring in 2024 includethe U.S. federal research and development credit, permanent differences, and stock based compensation.

Current wording

For the year ended December 31, 2024, our income tax benefit was approximately $3.7 million. Our effective tax rate of approximately 16.6% of pre-tax loss or the year ended December 31, 2024 was determined based on our pre-tax loss, statutory tax rates and the tax impacts of certain items including the U.S. federal research and development credit, certain non-deductible items, and stock based compensation.

Previous wording

As of December 31, 2024, we had $144.9 million in unrestricted cash and cash equivalents. On December 31, 2023, we had $221.1 million in unrestricted cash and cash equivalents.

Current wording

As of December 31, 2025 and 2024, we had $285.6 million and $144.9 million, respectively, in unrestricted cash and cash equivalents.

Previous wording

We are focused on expanding our business and product pipeline through collaborations, and also through acquisitions of products and companies. We are continually evaluating potential asset acquisitions and business combinations. To finance such acquisitions, we might raise additional equity capital, incur additional debt, or both.

Current wording

We are focused on expanding our business and product pipeline through acquisitions of products and companies as well as internal research and development. We are continually evaluating potential asset acquisitions and business combinations. To finance such acquisitions, we might raise additional equity capital, incur additional debt, or both.

Previous wording

Our working capital ratio, defined as total current assets divided by total current liabilities, is 2.7 as of December 31, 2024. We believe that our financial resources, consisting of net current working capital of approximately $334.0 million, anticipated future operating revenue and corresponding collections from customers, and our New Credit Agreement, under which $75.0 million remains available for borrowing as of December 31, 2024, will be sufficient to enable us to meet our working capital requirements, debt obligations, and other liability obligations for at least the next 12 months from the date of filing of this report, and for the foreseeable future thereafter. If our assumptions underlying estimated revenue and expenses are wrong, or if our cash requirements change materially as a result of shifts in our business or strategy, we could require additional financing. If we are not able to continue to be profitable in future years or are not able to continue to generate cash from operations as anticipated and additional capital is needed to support operations, we may be unable to obtain such financing, or obtain it on favorable terms, in which case we may be required to curtail development of new products, limit expansion of operations, or accept financing terms that are not as attractive as desired.

Current wording

Our working capital ratio, defined as total current assets divided by total current liabilities, is 2.7 as of December 31, 2025. We believe that our financial resources, consisting of net current working capital of approximately $475.0 million, anticipated future operating revenue and corresponding collections from customers, and available borrowings of underour revolving credit facility, of which $74.9 million is available as of December 31, 2025, will be sufficient to enable us to meet our working capital requirements, debt obligations, and other liability obligations for at least the next 12 months from the date of filing of this report, and for the foreseeable future thereafter. If our assumptions underlying estimated revenue and expenses are wrong, or if our cash requirements change materially as a result of shifts in our business or strategy, we could require additional financing. If we are not able to maintain profitability in future years or are not able to continue to generate cash from operations as anticipated and additional capital is needed to support operations, we may be unable to obtain such financing, or obtain it on favorable terms, in which case we may be required to curtail development of new products, limit expansion of operations, or accept financing terms that are not as attractive as desired.

Previous wording

Consolidation among wholesale distributors, chain drug stores, and group purchasing organizations has resulted in a smaller number of companies each controlling a larger share of pharmaceutical distribution channels. Our net revenues were concentrated among four customers representing 25%, 16%, 12%, and 11% of net revenues during the year ended December 31, 2024. As of December 31, 2024 accounts receivable from these four customers totaled approximately 70% of accounts receivable, net. Our net revenues were concentrated among four customers representing 31%, 13%, 13%, and 12% of net revenues during the year ended December 31, 2023. As of December 31, 2023, accounts receivable from these four customers totaled approximately 81% of accounts receivable, net. As a result, negotiated payment terms with these customers have a material impact on our liquidity and working capital.

Current wording

Consolidation among wholesale distributors, chain drug stores, and group purchasing organizations has resulted in a smaller number of companies each controlling a larger share of pharmaceutical distribution channels. Our net revenues were concentrated among three customers, which represented 22%, 17%, and 14% of our net revenues during the year ended December 31, 2025. As of December 31, 2025 accounts receivable from these three customers totaled approximately 64% of accounts receivable, net. Our net revenues were concentrated among four customers, which represented 25%, 16%, 12%, and 11% of our net revenues during the year ended December 31, 2024. As of December 31, 2024, accounts receivable from these four customers totaled approximately 70% of accounts receivable, net. As a result, negotiated payment terms with these customers have a material impact on our liquidity and working capital.