Core Points - Eagle Pharmaceuticals, Inc. will hold its 2025 Annual Meeting of Stockholders on October 17, 2025 [1] - The record date for stockholders to participate in the meeting is set for August 18, 2025, at 5 p.m. Eastern Time [1] Company Overview - Eagle Pharmaceuticals is a fully integrated pharmaceutical company with expertise in research and development, clinical, manufacturing, and commercial sectors [3] - The company is dedicated to developing innovative medicines that significantly improve patients' lives [3] - Eagle's commercialized products include PEMFEXY®, RYANODEX®, BENDEKA®, BELRAPZO®, TREAKISYM® (Japan), BYFAVO®, and BARHEMSYS® through its subsidiary Acacia Pharma Inc. [3] - The oncology and critical care pipeline includes product candidates aimed at addressing underserved therapeutic areas across multiple disease states [3] - The company focuses on developing medicines that could be integrated into the personalized medicine paradigm in cancer care [3]

Core Viewpoint - Eagle Pharmaceuticals has entered into a royalty purchase agreement with Blue Owl Capital to sell its royalty interest in BENDEKA for a total of $69 million before transaction costs, providing immediate capital to the company [1][3][4]. Group 1: Transaction Details - The agreement involves Eagle receiving an upfront payment of $69 million in exchange for a specified amount of its royalty interest in BENDEKA's net sales for the quarter ending December 31, 2024, and 100% of the royalty interest thereafter, capped at 1.3 times the purchase price [4]. - The proceeds from the transaction will be used to fully repay an existing credit agreement, including a $27.5 million term loan and $25 million under a revolving credit facility, with remaining funds allocated for general corporate purposes [5]. Group 2: Product Information - BENDEKA is a ready-to-dilute liquid formulation of bendamustine, approved for treating chronic lymphocytic leukemia (CLL) and indolent B-cell non-Hodgkin lymphoma (NHL) [2]. - The product is characterized by its low-volume (50 mL) and short infusion time (ten minutes) [2]. Group 3: Company Strategy and Future Plans - The company continues to invest in its R&D programs, including CAL02 for severe community-acquired bacterial pneumonia and EA 114 for hormone-receptor-positive metastatic breast cancer [6]. - The transaction is seen as a strategic move to enhance the company's financial position and support ongoing research initiatives [3]. Group 4: Advisory and Legal Support - Armentum Partners, LLC acted as the financial advisor for Eagle on this transaction, while Latham & Watkins LLP provided legal counsel to Eagle, and Gibson, Dunn & Crutcher LLP represented Blue Owl [7]. Group 5: Company Overview - Eagle Pharmaceuticals is a fully integrated pharmaceutical company focused on developing innovative medicines with a portfolio that includes products like PEMFEXY®, RYANODEX®, and BENDEKA® [8]. - The company aims to address underserved therapeutic areas across multiple disease states and is committed to personalized medicine in cancer care [8].

Core Viewpoint - Eagle Pharmaceuticals, Inc. has amended its limited duration stockholder rights plan to increase the initial purchase price of each preferred share purchase right from $10.00 to $20.00, effective immediately, in response to significant dislocation in the trading price of its common stock [1][2]. Group 1: Rights Plan Details - The Rights Plan is designed to penalize any person or group acquiring 10% or more of the company's common stock without Board approval, with a higher threshold of 15% for passive institutional investors [2]. - The amendment increases the potential dilution an Acquiring Person would face if the Rights Plan is triggered, thereby protecting stockholders' long-term investment value [2]. - The Rights Plan will automatically expire on October 30, 2025, unless earlier redeemed or exchanged by the company [3]. Group 2: Company Overview - Eagle Pharmaceuticals is a fully integrated pharmaceutical company with expertise in research and development, clinical, manufacturing, and commercial operations [4]. - The company is focused on developing innovative medicines, particularly in oncology and critical care, with products like PEMFEXY®, RYANODEX®, and others in its pipeline [4].

Overview of the Recent Transaction - On October 3, 2024, Union Square Park Capital Management acquired 1,191,490 shares of Eagle Pharmaceuticals Inc at $1.99 per share, impacting the firm's portfolio by 2.06% [1] - This acquisition establishes a substantial position in Eagle Pharmaceuticals for Union Square Park Capital Management, which has a total equity of $113 million and focuses on Consumer Cyclical and Real Estate sectors [1] Company Profile - Eagle Pharmaceuticals Inc is a specialty pharmaceutical company based in the USA, focusing on injectable products for critical care, orphan diseases, and oncology since its IPO on February 12, 2014 [3] - The current market capitalization of Eagle Pharmaceuticals is $12.96 million, with a stock price of $1 [3] Financial and Market Analysis - Eagle Pharmaceuticals has faced significant market challenges, with a stock price decline of 49.75% since the transaction, a 93.55% drop since its IPO, and a year-to-date decrease of 82.33% [4] - The company holds a GF Score of 60/100, indicating potential concerns about its future performance, with a Profitability Rank and Financial Strength of 7/10, but a lower Growth Rank of 3/10 [4] Impact of the Trade on Union Square Park Capital Management's Portfolio - The acquisition of Eagle Pharmaceuticals shares accounts for 2.06% of Union Square Park Capital Management's total investments and 9.17% of its holdings in the stock, diversifying the firm's investments and increasing exposure to the pharmaceutical sector [5] Market Reaction and Stock Performance Post-Transaction - Following the transaction, Eagle Pharmaceuticals' stock has not performed well, facing significant declines and valuation challenges, compounded by insufficient data for evaluation against the GF Value [6] Future Outlook and Strategic Positioning - The investment in Eagle Pharmaceuticals likely reflects a belief in the company's long-term potential despite current market struggles, positioning for a potential turnaround or significant developments that could lead to future value [7] Conclusion - The acquisition of Eagle Pharmaceuticals shares by Union Square Park Capital Management is a strategic move that aligns with its investment strategy, adding a new dimension to its portfolio despite the current performance challenges [8]

WOODCLIFF LAKE, N.J., April 15, 2024 (GLOBE NEWSWIRE) -- Eagle Pharmaceuticals, Inc. (NASDAQ:EGRX) ("Eagle" or the "Company") today announced that data from the Company's Phase III trial demonstrating the sustained response of amisulpride for the rescue treatment of postoperative nausea and vomiting ("PONV") will be presented at the upcoming American Society of PeriAnesthesia Nurses (ASPAN) 2024 National Conference, which is being held April 14-18, 2024, in Orlando, Florida. The data being presented relate ...

If you suffered losses exceeding $100,000 investing in Eagle Pharmaceuticals stock or options between August 8, 2023 and November 28, 2023 and would like to discuss your legal rights, call Faruqi & Faruqi partner Josh Wilson directly at 877-247-4292 or 212-983-9330 (Ext. 1310). You may also click here for additional information: www.faruqilaw.com/EGRX. There is no cost or obligation to you. NEW YORK, Feb. 01, 2024 (GLOBE NEWSWIRE) -- Faruqi & Faruqi, LLP, a leading national securities law firm, is investig ...

Financial Data and Key Metrics Changes - In Q2 2023, total revenue was $64.6 million, down from $74.1 million in Q2 2022. Net product sales were $43 million, compared to $49.2 million in the prior year [41][67] - Gross margin increased to 74% in Q2 2023 from 68% in the same quarter last year, driven by increased PEMFEXY sales and the expiration of the bendamustine royalty stream [42][67] - Net income for Q2 2023 was $5.2 million or $0.39 per share, compared to a net loss of $9.5 million or $0.74 loss per share in Q2 2022 [45][67] Business Line Data and Key Metrics Changes - Oncology gross profit, excluding amortization, was $43.8 million in Q2 2023, up from $38.7 million in Q2 2022, with gross margins of 84% compared to 82% [13] - Barhemsys and Byfavo sales totaled $1.2 million in Q2 2023, reflecting early-stage growth post-acquisition [77] - PEMFEXY net product sales were $19.4 million in Q2 2023, up from $16.5 million in Q2 2022, indicating continued market share growth [41] Market Data and Key Metrics Changes - Approximately 19,000 patients were dosed with Barhemsys or Byfavo in Q2 2023, indicating strong market acceptance [70] - The company has expanded its market share in the non-340B pemetrexed market to approximately 21%, up from 6% at the end of the previous year [76] Company Strategy and Development Direction - The company plans to add products through acquisitions and R&D, leveraging existing commercial infrastructure to minimize additional costs [8][26] - The Hospital segment is viewed as having strong growth potential, with ongoing relaunch efforts for Barhemsys and Byfavo [27] - The company raised its full-year guidance and resumed share repurchases, anticipating over $100 million in net working capital by year-end [67] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing strong performance and a solid foundation for growth in 2023 [56][68] - The company is focused on R&D investments to ensure the success of its product pipeline, particularly CAL02 and EA-114 [68][40] - Management acknowledged the disconnect between stock performance and company fundamentals, emphasizing confidence in future growth [53][62] Other Important Information - R&D expenses for Q2 2023 were $9.8 million, down from $11.4 million in Q2 2022, reflecting timing differences in program spending [44] - The company had $15.4 million in cash and cash equivalents, $115.1 million in net accounts receivable, and $71.3 million in outstanding debt as of June 30, 2023 [46] Q&A Session Summary Question: Can you expand on the seasonality in Q3? - Management noted that Q3 is expected to be slightly lower due to the cyclical nature of product sales, particularly for RYANODEX [50] Question: What are the expectations for Barhemsys and Byfavo over the next one to two years? - Management is optimistic about continued growth, citing a 30% growth rate since relaunch and positive customer feedback [51] Question: Can you discuss the disconnect between share buybacks and stock performance? - Management highlighted strong fundamentals and a positive outlook for the future, expressing hope that the market will recognize the company's potential [53]

Part I - Financial Information [Item 1. Condensed Consolidated Financial Statements](index=6&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) This section presents Eagle Pharmaceuticals, Inc.'s unaudited condensed consolidated financial statements for periods ended June 30, 2023, detailing financial position, operations, and cash flows with explanatory notes [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheets (unaudited, in thousands) | | June 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | **Total current assets** | $187,250 | $188,754 | | **Total assets** | **$404,822** | **$406,160** | | **Total current liabilities** | $86,630 | $111,087 | | **Total liabilities** | $152,782 | $172,600 | | **Total stockholders' equity** | $252,040 | $233,560 | | **Total liabilities and stockholders' equity** | **$404,822** | **$406,160** | - Cash and cash equivalents decreased significantly from **$55.3 million** at the end of 2022 to **$15.4 million** as of June 30, 2023[19](index=19&type=chunk) [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Condensed Consolidated Statements of Operations (unaudited, in thousands, except per share data) | | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | **Total revenue** | $64,646 | $74,136 | $130,951 | $190,010 | | **Income from operations** | $10,304 | $2,203 | $22,077 | $62,032 | | **Net income (loss)** | $5,164 | $(9,450) | $10,914 | $34,608 | | **Diluted EPS** | $0.39 | $(0.74) | $0.83 | $2.67 | - Total revenue for the six months ended June 30, 2023, decreased to **$131.0 million** from **$190.0 million** in the same period of 2022, primarily due to lower product sales and royalty revenue[20](index=20&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Condensed Consolidated Statements of Cash Flows (unaudited, in thousands) | | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | | **Net cash (used in) provided by operating activities** | $(33,638) | $26,381 | | **Net cash used in investing activities** | $(12,564) | $(75,584) | | **Net cash provided by (used in) financing activities** | $6,235 | $(11,894) | | **Net decrease in cash and cash equivalents** | $(39,967) | $(61,097) | | **Cash and cash equivalents at end of period** | $15,354 | $36,562 | - Cash used in operating activities was **$33.6 million** for the first six months of 2023, a significant shift from the **$26.4 million** provided by operating activities in the same period of 2022, largely driven by an increase in accounts receivable[26](index=26&type=chunk) - Investing activities primarily consisted of a **$12.5 million** purchase of an equity investment security in Enalare in H1 2023, compared to a **$75.4 million** net cash outlay for the Acacia acquisition in H1 2022[26](index=26&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, financial components, and significant events, covering revenue, customer concentration, acquisitions, and litigation - Effective January 1, 2023, the company changed the functional currency for its Acacia subsidiaries from the Pound Sterling to the U.S. dollar due to business integration[31](index=31&type=chunk)[32](index=32&type=chunk) Revenue Concentration by Major Customer | Customer | % of Total Revenue (Q2 2023) | % of Total Revenue (H1 2023) | | :--- | :--- | :--- | | Teva | 38% | 35% | | Customer A | 35% | 33% | | Customer B | 10% | 12% | - The company is involved in multiple patent litigations concerning its products Bendeka, Belrapzo, and Treakisym against generic drug manufacturers like Slayback, Apotex, and Fresenius[121](index=121&type=chunk)[129](index=129&type=chunk)[132](index=132&type=chunk) - On June 9, 2022, the company completed its acquisition of Acacia Pharma Group plc for a total consideration of **$100.4 million**, adding Barhemsys and Byfavo to its product portfolio[144](index=144&type=chunk)[147](index=147&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=39&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, key business developments, and outlook, analyzing revenues, costs, expenses, liquidity, and capital [Results of Operations](index=43&type=section&id=Results%20of%20Operations) This section analyzes the company's financial performance for Q2 and H1 2023, highlighting changes in revenue and net income Revenue Comparison (in thousands) | Revenue Source | Q2 2023 | Q2 2022 | Change | | :--- | :--- | :--- | :--- | | Product sales, net | $42,993 | $49,201 | $(6,208) | | Royalty revenue | $21,653 | $24,935 | $(3,282) | | **Total revenue** | **$64,646** | **$74,136** | **$(9,490)** | Operating Expenses Comparison (Q2 2023 vs Q2 2022, in thousands) | Expense Category | Q2 2023 | Q2 2022 | Change | | :--- | :--- | :--- | :--- | | Cost of revenue | $16,858 | $23,664 | $(6,806) | | Research and development | $9,833 | $11,437 | $(1,604) | | Selling, general and administrative | $27,651 | $36,832 | $(9,181) | - The decrease in Q2 2023 product sales was primarily due to a **$10.3 million** decline in vasopressin sales following the company's decision to exit the market[183](index=183&type=chunk) - The **$9.2 million** decrease in Q2 2023 SG&A expenses was mainly due to the non-recurrence of **$9.8 million** in Acacia acquisition-related costs and **$7.7 million** in severance from 2022[188](index=188&type=chunk) [Liquidity and Capital Resources](index=47&type=section&id=Liquidity%20and%20Capital%20Resources) This section details the company's liquidity sources, including cash, operating cash flows, and credit facilities, and assesses funding ability - Cash and cash equivalents stood at **$15.4 million** as of June 30, 2023, down from **$55.3 million** at year-end 2022[19](index=19&type=chunk)[205](index=205&type=chunk) - The company has a **$100 million** revolving credit facility, of which **$25.0 million** was outstanding as of June 30, 2023. The company also has a term loan with **$46.3 million** outstanding[109](index=109&type=chunk)[206](index=206&type=chunk) - Net cash used in operating activities for the first six months of 2023 was **$33.6 million**, primarily due to a **$42.7 million** increase in accounts receivable[26](index=26&type=chunk)[211](index=211&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=51&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) There were no material changes to the company's market risk disclosures during the six months ended June 30, 2023 - There were no material changes to the company's market risk disclosures during the six months ended June 30, 2023[222](index=222&type=chunk) [Item 4. Controls and Procedures](index=51&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of June 30, 2023, with no material changes to internal control - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of June 30, 2023[224](index=224&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[225](index=225&type=chunk) Part II - Other Information [Item 1. Legal Proceedings](index=52&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in several legal proceedings, primarily patent infringement lawsuits concerning key products and commercial disputes - The company is in arbitration with Curia Global, Inc., which seeks over **$76.7 million** in damages related to a vasopressin supply agreement. Eagle has denied the allegations and asserted counterclaims[118](index=118&type=chunk)[119](index=119&type=chunk) - Multiple patent infringement lawsuits are ongoing against generic manufacturers (Slayback, Apotex, Fresenius, etc.) who have filed ANDAs challenging the patents for Bendeka[121](index=121&type=chunk) - The company, along with its Japanese partner SymBio, has initiated patent infringement lawsuits in Tokyo against Towa Pharmaceutical and Pfizer Japan regarding TREAKISYM[132](index=132&type=chunk) [Item 1A. Risk Factors](index=52&type=section&id=Item%201A.%20Risk%20Factors) This section supplements existing risk factors, highlighting adverse effects from macroeconomic conditions, geopolitical events, and healthcare legislation - The company's financial condition may be negatively affected by macroeconomic conditions including rising inflation, interest rates, supply chain disruptions, and geopolitical events like the Russia-Ukraine conflict[230](index=230&type=chunk) - Recent bank failures (e.g., Silicon Valley Bank) have created financial market liquidity risks, which could impair the company's ability to access its cash or raise additional capital if conditions worsen[231](index=231&type=chunk) - Current and future healthcare legislation, such as the Affordable Care Act (ACA) and the Inflation Reduction Act of 2022 (IRA), could increase the difficulty and cost of commercializing products and negatively affect pricing. The IRA, for example, directs HHS to negotiate prices for certain Medicare drugs and imposes rebates for price increases that outpace inflation[234](index=234&type=chunk)[235](index=235&type=chunk)[238](index=238&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=54&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section discusses the company's share repurchase program, including the remaining authorization and no repurchases during the quarter - The company did not repurchase any of its equity securities during the three months ended June 30, 2023[242](index=242&type=chunk) - Approximately **$86 million** remained available for future purchases under the company's **$160 million** Share Repurchase Program as of June 30, 2023[240](index=240&type=chunk)[242](index=242&type=chunk) [Item 5. Other Information](index=55&type=section&id=Item%205.%20Other%20Information) This section discloses the adoption of a Rule 10b5-1 trading plan by an executive officer for the potential sale of company shares - On June 15, 2023, CEO Scott Tarriff adopted a Rule 10b5-1 trading plan for the sale of up to **299,375 shares** of company stock[246](index=246&type=chunk)

Financial Data and Key Metrics Changes - For Q1 2023, total revenue was $66.3 million, down from $115.9 million in the prior year [13] - Net product sales were $46.2 million in Q1 2023, compared to $90.1 million in Q1 2022 [13] - Net income for Q1 2023 was $5.8 million, or $0.44 per share, compared to $44.1 million, or $3.47 per share, in the prior year [16] - Adjusted non-GAAP net income for Q1 2023 was $16.5 million, or $1.27 per share, down from $52.2 million, or $4.10 per share, in the prior year [16] - Gross margin decreased to 74% in Q1 2023 from 76% in the prior year [14] Business Line Data and Key Metrics Changes - PEMFEXY net product sales were $22.9 million in Q1 2023, down from $37.2 million in Q1 2022 [13] - Vasopressin net product sales were $3.5 million in Q1 2023, with the company announcing its withdrawal from the vasopressin market [13] - Combined net sales of BARHEMSYS and BYFAVO were just shy of $1 million in Q1 2023, with a 32% sequential increase from Q4 2022 [9] Market Data and Key Metrics Changes - The company's share of commercial, non-340B pemetrexed usage in community oncology grew from 6% at the end of Q4 2022 to an estimated 15% in Q2 2023 [7] - BENDEKA and BELRAPZO maintained approximately 89% share of the bendamustine U.S. market in Q1 2023, down slightly from 90% historically [31] Company Strategy and Development Direction - The company aims to leverage its strong balance sheet for potential accretive acquisitions, particularly in the acute care or oncology space [10] - The establishment of a unique J-Code for BYFAVO is expected to facilitate reimbursement and broaden access [33] - The company is focused on long-term growth through its pipeline and potential acquisitions, with a specific interest in oncology products [12][64] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving full-year guidance for 2023, citing investments in products and pipeline development as key factors [29] - The company anticipates continued growth in PEMFEXY sales, projecting to surpass the $67 million recorded for the full year of 2022 [30] - Management noted that the competitive landscape for the bendamustine franchise remains stable, with confidence in exclusivity until November 2027 [32] Other Important Information - R&D expenses increased to $9.3 million in Q1 2023, up from $6.1 million in Q1 2022, primarily due to ongoing clinical trials [38] - As of March 31, 2023, the company had $21.9 million in cash and cash equivalents, $150 million in net accounts receivable, and $77.5 million in outstanding debt [39] Q&A Session Summary Question: What is the expected launch timing for landiolol? - Management indicated that they may wait a couple of quarters to gain access before launching landiolol to avoid interference with the Acacia products [20] Question: Can you discuss the growth trajectory of PEMFEXY? - Management expressed optimism about PEMFEXY's growth, noting a rise from 6% to 15% market share and projecting strong sales for 2023 [22] Question: What is the rationale behind securing financing for acquisitions now? - Management clarified that they are lining up lenders to be prepared for suitable acquisition opportunities as they arise [45] Question: Is the company focused on the hospital space or looking to expand? - Management indicated a preference for oncology acquisitions in the near term, given the favorable conditions in that market [64]

[Part I - Financial Information](index=6&type=section&id=Part%20I%20-%20Financial%20Information) [Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) Eagle Pharmaceuticals reported a significant year-over-year decrease in Q1 2023 total revenue and net income, alongside a decline in cash and cash equivalents Condensed Consolidated Balance Sheet Highlights (in millions) | Account | March 31, 2023 | December 31, 2022 | | :--- | :--- | :--- | | Cash and cash equivalents | $21.9 | $55.3 | | Accounts receivable, net | $115.0 | $72.4 | | Total assets | $414.2 | $406.2 | | Total liabilities | $171.3 | $172.6 | | Total stockholders' equity | $242.8 | $233.6 | Condensed Consolidated Statements of Operations (in millions, except per share data) | Metric | Q1 2023 | Q1 2022 | | :--- | :--- | :--- | | Total revenue | $66.3 | $115.9 | | Income from operations | $11.8 | $59.8 | | Net income | $5.8 | $44.1 | | Diluted EPS | $0.44 | $3.41 | Condensed Consolidated Statements of Cash Flows Highlights (in millions) | Cash Flow Activity | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | $(33.5) | $(16.6) | | Net cash used in investing activities | $(12.6) | $(0.2) | | Net cash provided by (used in) financing activities | $12.6 | $(11.4) | | Net decrease in cash and cash equivalents | $(33.4) | $(28.1) | [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=37&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the Q1 2023 revenue decline to decreased product sales and royalties, while operating expenses rose due to increased R&D and SG&A, though liquidity is deemed sufficient [Overview and Recent Developments](index=38&type=section&id=Overview%20and%20Recent%20Developments) The company highlights strategic developments including obtaining a J-code for Byfavo, discontinuing vasopressin, amending its credit agreement, investing in Enalare, and advancing its pipeline - The company announced its **withdrawal from the vasopressin market** in Q1 2023, with inventory expected to be depleted by the end of Q2 2023[161](index=161&type=chunk) - CMS has established a unique **J-code (J2249) for Byfavo**, effective July 1, 2023, which is intended to simplify the reimbursement process[160](index=160&type=chunk) - The **acquisition of Acacia Pharma** in June 2022 added two FDA-approved hospital products, **BARHEMSYS and BYFAVO**, to the company's portfolio[165](index=165&type=chunk)[168](index=168&type=chunk) - The company has committed to **equity investments of up to $55 million in Enalare Therapeutics Inc.** and holds an option to acquire the remaining shares of the company[163](index=163&type=chunk) [Results of Operations](index=42&type=section&id=Results%20of%20Operations) Q1 2023 total revenue decreased by **$49.6 million** due to lower product sales and royalties, while R&D and SG&A expenses increased, primarily driven by the CAL02 program and personnel costs Revenue Comparison (in millions) | Revenue Type | Q1 2023 | Q1 2022 | Change | | :--- | :--- | :--- | :--- | | Product sales, net | $46.2 | $90.1 | $(43.9) | | Royalty revenue | $20.1 | $25.8 | $(5.7) | | **Total revenue** | **$66.3** | **$115.9** | **$(49.6)** | - The decline in product sales was primarily due to decreased sales of **vasopressin ($30.8 million)** and **Pemfexy ($14.2 million)** following their initial launch in Q1 2022[185](index=185&type=chunk) Operating Expenses Comparison (in millions) | Expense Category | Q1 2023 | Q1 2022 | Change | | :--- | :--- | :--- | :--- | | Cost of revenue | $17.3 | $27.8 | $(10.5) | | Research and development | $9.3 | $6.1 | $3.2 | | Selling, general and administrative | $28.0 | $22.2 | $5.8 | - **R&D expenses increased by $3.2 million**, mainly driven by a **$2.0 million** increase in spending on the **CAL02 project**[190](index=190&type=chunk) [Liquidity and Capital Resources](index=44&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity sources include cash, operations, and a credit facility, with cash and cash equivalents at **$21.9 million** as of March 31, 2023, and management believes resources are sufficient for the next 12 months - Cash and cash equivalents were **$21.9 million** as of March 31, 2023[196](index=196&type=chunk) - Net cash used in operating activities was **$33.5 million** for Q1 2023, primarily due to changes in working capital, including a significant increase in accounts receivable[201](index=201&type=chunk) - The company drew an additional **$15.0 million** from its revolving credit facility on February 8, 2023, which provides for borrowings up to **$100 million**[197](index=197&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=48&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company reported no material changes to its market risk disclosures compared to its Annual Report on Form 10-K for the year ended December 31, 2022 - There were **no material changes** to the company's market risk disclosures during the three months ended March 31, 2023[214](index=214&type=chunk) [Controls and Procedures](index=48&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2023, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were **effective** at the reasonable assurance level as of March 31, 2023[216](index=216&type=chunk) - **No changes** in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, internal controls[217](index=217&type=chunk) [Part II - Other Information](index=49&type=section&id=Part%20II%20-%20Other%20Information) [Legal Proceedings](index=28&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal proceedings, including commercial litigation with Curia Global and multiple patent litigations related to its products, with uncertain outcomes - Curia Global has filed a demand for arbitration seeking damages over **$76.7 million** related to a vasopressin supply agreement and a separate action for over **$4.2 million** related to a PEMFEXY supply agreement[114](index=114&type=chunk) - The company is engaged in ongoing **patent infringement litigation** to defend its **Bendeka and Belrapzo** products against multiple ANDA filers, with several cases settled[116](index=116&type=chunk)[123](index=123&type=chunk) - The company, along with its partner SymBio, has initiated **patent infringement lawsuits in Japan** against Towa Pharmaceutical and Pfizer Japan regarding its **Treakisym** product[127](index=127&type=chunk) [Risk Factors](index=49&type=section&id=Item%201A.%20Risk%20Factors) The company highlights supplemental risks from macroeconomic conditions, banking failures impacting capital access, and legislative changes like the Inflation Reduction Act of 2022 affecting drug pricing - The business faces risks from **macroeconomic conditions** including rising inflation, interest rates, supply chain disruptions, and geopolitical events like the Russia-Ukraine conflict[222](index=222&type=chunk) - Recent **bank failures and financial market instability** could impair the company's ability to access its cash deposits and raise additional capital[223](index=223&type=chunk) - Current and future legislation, such as the **Inflation Reduction Act of 2022 (IRA)**, may increase the difficulty and cost of commercializing products and negatively affect drug prices through government negotiation and inflation-based rebates[226](index=226&type=chunk)[230](index=230&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=51&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company did not repurchase any equity securities during Q1 2023, with approximately **$86 million** remaining available under its share repurchase program - **No shares were repurchased** during the three months ended March 31, 2023[234](index=234&type=chunk) - As of March 31, 2023, approximately **$86 million** remained available for future purchases under the company's share repurchase program[234](index=234&type=chunk)