Summary of Supernus Pharmaceuticals (SUPN) Conference Call Company Overview - Supernus Pharmaceuticals is a CNS-focused biopharmaceutical company with approximately eight products on the market, including legacy products and significant growth drivers [3][4] - The company reported profitable revenues around $600 million, despite the loss of exclusivity on flagship products [5] Key Products and Financials - **KELBRII**: A novel ADHD treatment launched in May 2021, currently generating a run rate of approximately $260 million. The product has significant growth potential with a large market of 100 million prescriptions annually [4][7][8] - **ONAPCO**: A recently launched infusion device for Parkinson's, with over 200 prescribers and 500 patient enrollment forms submitted within a month of launch. The peak sales potential is estimated between $200 million to $300 million [27][31][34] - Revenue expectations for 2025 are projected between $600 million and $630 million, with 2025 potentially being a trough year due to the full-year impact of generic competition for Oxtellar XR [6][7] Growth Drivers - The growth of KELBRII, GOCOVRI, and ONAPCO are expected to offset revenue losses from other products [6] - The company anticipates continued volume growth in prescriptions, with a historical growth rate of over 20% for KELBRII [10][11] Market Dynamics and Competition - The ADHD market is characterized by competition, but the company believes that competition can be beneficial for market growth [25][26] - Potential competitors for KELBRII include Osuka and Axsome, but the company remains optimistic about its long-term growth trajectory [22][23] Pipeline Developments - **SPN-820**: A novel mTORC inhibitor for major depressive disorder (MDD) is set to enter a Phase 2b study, with hopes of demonstrating a clinically meaningful reduction in depression scores [42][49] - **SPN-817**: An acetylcholinesterase inhibitor for epilepsy, with Phase 2 data expected by the end of 2027. The drug shows promise in reducing seizures while potentially improving cognitive function [57][61] Business Development Strategy - The company is actively pursuing business development opportunities, focusing on commercial assets and products that can be launched between 2026 and 2030 [68][69] - Supernus has a clean balance sheet with zero debt, providing financial flexibility for potential acquisitions [69] Conclusion - Supernus Pharmaceuticals is positioned for growth with a strong product portfolio and pipeline, despite facing challenges from generic competition and market dynamics. The company is committed to exploring business development opportunities to enhance its product offerings and maintain its competitive edge in the CNS market [70]

Core Insights - Supernus Pharmaceuticals is launching a new video series featuring Jay Glazer and his wife Rosie, focusing on the impact of ADHD on relationships and the role of Qelbree in managing ADHD symptoms [1][2][3] - The series aims to foster open discussions about ADHD, sharing practical strategies for symptom management and insights from both Jay and Rosie [2][3] Company Overview - Supernus Pharmaceuticals is a biopharmaceutical company dedicated to developing and commercializing treatments for central nervous system (CNS) diseases, including ADHD [11][12] - The company has a diverse neuroscience portfolio that includes approved treatments for various CNS disorders, and is actively developing new potential treatments for conditions such as epilepsy and depression [12] Product Information - Qelbree (viloxazine extended-release capsules) is a non-stimulant prescription medication used to treat ADHD in individuals aged 6 years and older [5][10] - Qelbree is available in three dosages: 100 mg, 150 mg, and 200 mg capsules [10]

Core Insights - Supernus Pharmaceuticals, Inc. has received Paragraph IV Notice Letters from third parties regarding Abbreviated New Drug Applications (ANDAs) for viloxazine extended-release capsules in 100, 150, and 200 mg doses [1][2] - The company is reviewing these Notice Letters and plans to enforce its intellectual property rights related to its product Qelbree, which is protected by six U.S. patents with expiration dates ranging from September 2029 to April 2035 [2] Company Overview - Supernus Pharmaceuticals focuses on developing and commercializing products for central nervous system (CNS) diseases [3] - The company's neuroscience portfolio includes treatments for ADHD, dyskinesia in Parkinson's disease, epilepsy, migraine, and other CNS disorders, with ongoing development of new candidates for epilepsy and depression [4]

Core Insights - Supernus Pharmaceuticals, Inc. is participating in the 2025 Jefferies Global Healthcare Conference on June 4, 2025, where CEO Jack A. Khattar will engage in a fireside chat [1] - The company focuses on developing and commercializing products for central nervous system (CNS) diseases [3][4] Company Overview - Supernus Pharmaceuticals specializes in treatments for CNS diseases, including ADHD, dyskinesia in Parkinson's disease, epilepsy, migraine, cervical dystonia, and chronic sialorrhea [4] - The company is also developing new potential treatments for epilepsy, depression, and other CNS disorders [4] Conference Details - Investors can arrange meetings with company management during the conference by contacting the Jefferies conference coordinator [2] - A live audio webcast of the presentation will be available, with an archived replay accessible for 60 days post-conference [2]

Company Overview - Supernus Pharmaceuticals is a biopharmaceutical company focused on developing and commercializing products for the treatment of central nervous system (CNS) diseases [15] - The company has a diverse neuroscience portfolio that includes approved treatments for ADHD, dyskinesia in Parkinson's disease, epilepsy, migraine, and other CNS disorders [16] Product Information - Qelbree (viloxazine extended-release capsules) is a prescription medicine used to treat ADHD in adults and children aged 6 years and older [6] - Qelbree is a novel, once-a-day, non-stimulant approach for ADHD treatment and is the first non-stimulant approved for adults with ADHD in 20 years [4] - As a non-stimulant, Qelbree has no evidence of abuse or misuse and can be conveniently refilled without needing a new prescription each month [4] Campaign and Awareness - The 'Ms. Represented' campaign, in partnership with Busy Philipps, aims to empower women with ADHD to understand their symptoms and seek help [1][4] - The campaign highlights the often-misrepresented experiences of women with ADHD, focusing on the differences in symptom presentation between genders [2][3] - Increased awareness of ADHD symptoms among females is leading to more women seeking diagnosis and treatment [3] Market Insights - Studies indicate that boys are twice as likely as girls to be diagnosed with ADHD, resulting in many women remaining undiagnosed or misdiagnosed until adulthood [3] - The campaign seeks to address the disparity in ADHD diagnosis and treatment between males and females [4]

Group 1 - Supernus Pharmaceuticals, Inc. (SUPN) is experiencing significant activity in the options market, particularly with the June 20, 2025 $30 Call showing high implied volatility, indicating potential for a major price movement [1] - Implied volatility reflects market expectations for future stock movement, suggesting that investors anticipate a significant event that could lead to a substantial price change [2] - Supernus Pharmaceuticals holds a Zacks Rank 3 (Hold) in the Medical - Generic Drugs industry, which is in the bottom 16% of the Zacks Industry Rank, indicating a relatively weak position within the sector [3] Group 2 - Over the past 60 days, one analyst has raised earnings estimates for Supernus Pharmaceuticals for the current quarter from 46 cents per share to 48 cents, while no analysts have lowered their estimates, reflecting a slight positive sentiment [3] - The high implied volatility may present trading opportunities, as options traders often seek to sell premium on options with elevated implied volatility, aiming to benefit from time decay if the stock does not move as expected [4]

Core Insights - Supernus Pharmaceuticals reported $149.82 million in revenue for Q1 2025, a year-over-year increase of 4.3% and a surprise of +2.91% over the Zacks Consensus Estimate of $145.59 million [1] - The company achieved an EPS of $0.42, compared to $0.00 a year ago, with an EPS surprise of +10.53% against the consensus estimate of $0.38 [1] Revenue Breakdown - Trokendi XR generated $12.80 million in net product sales, exceeding the average estimate of $8.58 million, but representing a year-over-year decline of -20% [4] - Oxtellar XR reported $10.20 million in net product sales, below the average estimate of $12.29 million, with a significant year-over-year decrease of -62.1% [4] - Qelbree achieved $64.70 million in net product sales, slightly below the average estimate of $65.54 million, but showing a year-over-year increase of +43.5% [4] - Total net product sales amounted to $141.99 million, surpassing the average estimate of $140.61 million, reflecting a year-over-year growth of +2.6% [4] - Royalty revenues reached $7.84 million, exceeding the estimated $5.80 million, with a year-over-year increase of +51.2% [4] - GOCOVRI net product sales were $30.70 million, above the average estimate of $30.13 million, marking a year-over-year increase of +15.9% [4] - Other net product sales totaled $8.60 million, surpassing the average estimate of $7.38 million, with a year-over-year growth of +19.4% [4] - APOKYN reported $15 million in net product sales, below the average estimate of $16.70 million, reflecting a year-over-year decline of -10.2% [4] Stock Performance - Supernus shares returned +0.4% over the past month, while the Zacks S&P 500 composite increased by +11.5% [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating potential for outperformance against the broader market in the near term [3]

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $149.8 million, compared to $143.6 million in Q1 2024, reflecting an increase driven by core products KELRI and GOCOVRI [14][16] - Total revenues excluding Trokendi XR and Oxtellar XR increased by 26% year-over-year [6][15] - GAAP net loss for Q1 2025 was $11.8 million, or loss per diluted share of $0.21, compared to a GAAP net earnings of $124,000 in the prior year [16] Business Line Data and Key Metrics Changes - KELRI grew by 22% in prescriptions and 44% in net sales, with March 2025 prescriptions reaching an all-time high of 75,277, up 25% year-over-year [7][8] - GOCOVRI prescriptions increased by 12% and net sales increased by 16% compared to the same quarter last year [8] - Combined net sales of Trokendi XR and Oxtellar XR were down 46% [10] Market Data and Key Metrics Changes - The Medicare Inflation Reduction Act led to a 42% decline in GOCOVRI's Medicare co-pay, resulting in increased prescriptions among Medicare patients [8] - By March 2025, 84% of GOCOVRI's Medicare prescriptions cost patients less than $25 [8] Company Strategy and Development Direction - The company plans to drive growth through core products while investing in its pipeline and launching new products like NAPCO [9][11] - Corporate development remains a top priority, focusing on strategic opportunities to enhance future growth [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth trajectory of KELRI, emphasizing strong prescription growth and market position [20] - The company is well-positioned for continued growth despite the loss of exclusivity on legacy products, focusing on cash flow generation and operational efficiency [56][57] Other Important Information - The company has approximately $463.6 million in cash and marketable securities as of March 31, 2025, reflecting strong financial flexibility [16] - The company reiterated its 2025 financial guidance, expecting total revenues between $600 million and $630 million [17] Q&A Session Summary Question: Key growth drivers for KELBRE in 2025 - Growth will be driven by volume rather than price, with a small price increase implemented [20] Question: Timing for data readout from SPN-eight 20 study - Best case scenario for starting the study is before year-end 2025, with data expected in about 1.5 years [24] Question: Impact of Q1 dynamics on KELBRE net pricing - Q1 typically sees pressure on gross to net pricing, with expectations for improvement in subsequent quarters [28] Question: Reimbursement discussions for ONAPCO - The company expects a high percentage of enrollment forms to be fulfilled, with a strong support system in place [34] Question: Competitive dynamics versus AbbVie product - Initial feedback on ONAPCO has been positive, with a strong start in the market [42] Question: Proportion of naive patients on KELBRE - Approximately 32-33% of patients are naive first-line treatments, with the remainder being switches from other medications [51]

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $149.8 million, compared to $143.6 million in Q1 2024, reflecting an increase driven by core products [14] - Total revenues excluding Trokendi XR and Oxtellar XR increased by 26% year-over-year [6][15] - GAAP net loss for Q1 2025 was $11.8 million, or loss per diluted share of $0.21, compared to a GAAP net earnings of $124,000 in the prior year [16] - Adjusted operating earnings for Q1 2025 were $25.9 million, up from $22.3 million in Q1 2024 [17] - Cash and cash equivalents as of March 31, 2025, were approximately $463.6 million, an increase from $453.6 million at the end of 2024 [17] Business Line Data and Key Metrics Changes - KELBRE saw a 22% increase in prescriptions and a 44% increase in net sales, with March 2025 prescriptions reaching an all-time high of 75,277 [7] - GOCOVRI prescriptions increased by 12% and net sales increased by 16% compared to the same quarter last year [8] - Combined net sales of Trokendi XR and Oxtellar XR were down 46% in Q1 2025 [10] Market Data and Key Metrics Changes - The Medicare Inflation Reduction Act led to a 42% decline in GOCOVRI's Medicare co-pay, resulting in increased prescriptions among Medicare patients [8] - 84% of GOCOVRI's Medicare prescriptions cost patients less than $25 by March 2025 [8] Company Strategy and Development Direction - The company aims to drive growth from core products while investing in its pipeline and launching new products like NAPCO [9][57] - Corporate development remains a top priority to strengthen future growth through strategic opportunities [11][57] - The company plans to initiate a follow-on phase 2b trial for SPN-eight twenty in adults with major depressive disorder [10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth trajectory of KELBRE, emphasizing that growth will be driven more by volume than price [21] - The company is confident in its ability to navigate the current environment, including potential tariff impacts, as most products are shielded from tariffs [12] - Management reiterated guidance for total revenues in 2025 to range from $600 million to $630 million [18] Other Important Information - The company is focused on enhancing its infrastructure for new product launches, ensuring a smooth transition from patient enrollment to product delivery [30] - The company has established a strong support system for patients and physicians, which is seen as a competitive advantage [45] Q&A Session Summary Question: Key growth drivers for KELBRE in 2025 - Growth will be driven by both volume and a small price increase, with a strong prescription growth observed in Q1 [21] Question: Timing for data readout from the study on SPN-eight twenty - The study is expected to start before year-end 2025, with data potentially available in about 18 months [25] Question: Impact of Q1 dynamics on KELBRE net pricing - Q1 typically sees pressure on gross to net pricing, but improvements are expected in subsequent quarters [29] Question: Reimbursement discussions for ONAPCO - The company expects a high percentage of enrollment forms to be fulfilled, with a strong support system in place for reimbursement [34] Question: Competitive dynamics regarding ONAPCO - Initial feedback from physicians has been positive, and the product is seen as a strong alternative to existing therapies [45] Question: Potential indications for SBN-eight twenty - The company is considering multiple indications, including ADHD and sleep-wake disorders, but has not finalized the lead indication yet [48]

[PART I — FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) This section presents the company's unaudited condensed consolidated financial statements and management's discussion and analysis for the reporting period [Item 1. Unaudited Condensed Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section presents Supernus Pharmaceuticals, Inc.'s unaudited condensed consolidated financial statements for the quarter ended March 31, 2025, including balance sheets, statements of earnings (loss), comprehensive earnings (loss), changes in stockholders' equity, and cash flows, along with detailed notes explaining business organization, accounting policies, revenue disaggregation, investments, contingent consideration, intangible assets, debt, share-based payments, earnings per share, income tax, leases, segment reporting, and commitments and contingencies [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Presents the company's financial position, including assets, liabilities, and equity, at specific reporting dates Condensed Consolidated Balance Sheets (in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :-------------------------------- | :------------- | :---------------- | | Total current assets | $687,584 | $686,070 | | Total assets | $1,347,290 | $1,368,073 | | Total current liabilities | $281,772 | $292,397 | | Total liabilities | $316,585 | $332,340 | | Total stockholders' equity | $1,030,705 | $1,035,733 | - Cash and cash equivalents increased significantly to **$115.8 million** as of March 31, 2025, from **$69.3 million** as of December 31, 2024[9](index=9&type=chunk) - Marketable securities decreased to **$347.7 million** as of March 31, 2025, from **$384.3 million** as of December 31, 2024[9](index=9&type=chunk) [Condensed Consolidated Statements of Earnings (Loss)](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Earnings%20%28Loss%29) Details the company's revenues, costs, expenses, and net earnings or loss over specific reporting periods Condensed Consolidated Statements of Earnings (Loss) (in thousands, except per share data) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Total revenues | $149,824 | $143,644 | | Total costs and expenses | $160,080 | $146,797 | | Operating loss | $(10,256) | $(3,153) | | Net earnings (loss) | $(11,827) | $124 | | Basic EPS | $(0.21) | $0.00 | | Diluted EPS | $(0.21) | $0.00 | - Total revenues increased by **4%** year-over-year, from **$143.6 million** in Q1 2024 to **$149.8 million** in Q1 2025[11](index=11&type=chunk) - The company reported a net loss of **$11.8 million** in Q1 2025, a significant decline from net earnings of **$0.1 million** in Q1 2024, primarily due to increased costs and expenses, including a contingent consideration loss[11](index=11&type=chunk) [Condensed Consolidated Statements of Comprehensive Earnings (Loss)](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Earnings%20%28Loss%29) Presents the total change in equity from non-owner sources, including net earnings (loss) and other comprehensive income (loss) Condensed Consolidated Statements of Comprehensive Earnings (Loss) (in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Net earnings (loss) | $(11,827) | $124 | | Unrealized gain on marketable securities, net of tax | $30 | $59 | | Comprehensive earnings (loss) | $(11,797) | $183 | - Comprehensive loss for Q1 2025 was **$11.8 million**, compared to comprehensive earnings of **$0.2 million** in Q1 2024, reflecting the net loss for the period[14](index=14&type=chunk) [Condensed Consolidated Statements of Changes in Stockholders' Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders%27%20Equity) Outlines the changes in the company's equity accounts, including common stock, additional paid-in capital, and retained earnings Changes in Stockholders' Equity (in thousands, except share data) | Metric | Balance, Dec 31, 2024 | Share-based Comp. Expense | Issuance of Common Stock | Net Earnings (Loss) | Unrealized Gain | Balance, Mar 31, 2025 | | :-------------------------------- | :-------------------- | :------------------------ | :----------------------- | :------------------ | :-------------- | :-------------------- | | Common Stock (Shares) | 55,743,095 | — | 246,153 | — | — | 55,989,248 | | Common Stock (Amount) | $56 | — | — | — | — | $56 | | Additional Paid-in Capital | $479,440 | $8,068 | $(1,299) | — | — | $486,209 | | Retained Earnings | $556,426 | — | — | $(11,827) | — | $544,599 | | Total Stockholders' Equity | $1,035,733 | $8,068 | $(1,299) | $(11,827) | $30 | $1,030,705 | - Total stockholders' equity decreased from **$1,035.7 million** at December 31, 2024, to **$1,030.7 million** at March 31, 2025, primarily due to the net loss incurred during the quarter, partially offset by share-based compensation[17](index=17&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Summarizes the cash inflows and outflows from operating, investing, and financing activities for the reporting period Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Net cash provided by operating activities | $30,599 | $38,401 | | Net cash provided by (used in) investing activities | $37,317 | $(51,624) | | Net cash provided by (used in) financing activities | $(21,399) | $1,570 | | Net change in cash and cash equivalents | $46,517 | $(11,653) | | Cash and cash equivalents at end of period | $115,848 | $63,401 | - Net cash provided by operating activities decreased to **$30.6 million** in Q1 2025 from **$38.4 million** in Q1 2024[20](index=20&type=chunk) - Investing activities shifted from a net cash outflow of **$51.6 million** in Q1 2024 to a net cash inflow of **$37.3 million** in Q1 2025, driven by changes in marketable securities[20](index=20&type=chunk) - Financing activities resulted in a net cash outflow of **$21.4 million** in Q1 2025, compared to an inflow of **$1.6 million** in Q1 2024, primarily due to a contingent consideration payment[20](index=20&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Provides detailed explanations of the company's accounting policies and specific financial statement items [1. Business Organization](index=9&type=section&id=1.%20Business%20Organization) Describes the company's core business, therapeutic focus, and key product portfolio - Supernus Pharmaceuticals, Inc. is a biopharmaceutical company focused on developing and commercializing products for central nervous system (CNS) diseases[22](index=22&type=chunk) - The company's portfolio includes approved treatments for ADHD, Parkinson's Disease (PD) dyskinesia and hypomobility, epilepsy, migraine, cervical dystonia, and chronic sialorrhea[22](index=22&type=chunk) - In February 2025, the FDA approved ONAPGO (apomorphine hydrochloride) injection for motor fluctuations in advanced PD, which was launched in April 2025[23](index=23&type=chunk) [2. Summary of Significant Accounting Policies](index=9&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) Outlines the key accounting principles and methods used in preparing the financial statements - The unaudited condensed consolidated financial statements are prepared in accordance with SEC requirements for interim financial information and U.S. GAAP[23](index=23&type=chunk) - The company operates in one operating segment, primarily located in the U.S.[25](index=25&type=chunk) - Advertising expense increased to approximately **$26.1 million** for Q1 2025 from **$24.3 million** for Q1 2024, recorded as a component of Selling, general and administrative expenses[32](index=32&type=chunk) - Approximately **$4.4 million** of insurance recoveries were recorded in Q1 2025, reducing Selling, general and administrative expenses, with no recoveries in Q1 2024[34](index=34&type=chunk) - The company adopted ASU 2023-07 (Improvements to Reportable Segment Disclosures) on January 1, 2024, and plans to adopt ASU 2023-09 (Improvements to Income Tax Disclosures) for fiscal year 2025 and ASU 2024-03 (Disaggregation of Income Statement Expenses) for fiscal year 2027[35](index=35&type=chunk)[36](index=36&type=chunk)[37](index=37&type=chunk) [3. Disaggregated Revenues](index=12&type=section&id=3.%20Disaggregated%20Revenues) Provides a breakdown of total revenues by product and revenue type for the reporting periods Disaggregated Revenues (dollars in thousands) | Product | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :---------------- | :-------------------------------- | :-------------------------------- | | Qelbree | $64,745 | $45,104 | | GOCOVRI | $30,689 | $26,562 | | APOKYN | $14,976 | $16,649 | | Trokendi XR | $12,801 | $15,989 | | Oxtellar XR | $10,198 | $26,943 | | Other | $8,579 | $7,214 | | Total net product sales | $141,988 | $138,461 | | Royalty, licensing and other revenues | $7,836 | $5,183 | | Total revenues | $149,824 | $143,644 | - Qelbree net product sales increased by **44%** to **$64.7 million** in Q1 2025, while Oxtellar XR sales decreased by **62%** to **$10.2 million**[38](index=38&type=chunk) - The company adjusted its estimated provision for product returns in Q1 2025 due to favorable actual returns experience for Qelbree, with prior year sales returns provision being less than **5%** of net product sales, primarily from Qelbree[39](index=39&type=chunk) [4. Investments](index=12&type=section&id=4.%20Investments) Details the company's marketable securities, including their amortized cost, unrealized gains and losses, and fair value Marketable Securities (dollars in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :-------------------------------- | :------------- | :---------------- | | Amortized cost | $347,903 | $384,481 | | Gross unrealized gains | $12 | $89 | | Gross unrealized losses | $(173) | $(289) | | Total fair value | $347,742 | $384,281 | - All unrestricted available-for-sale marketable securities as of March 31, 2025, have contractual maturities of one year or less[40](index=40&type=chunk) - There was no impairment due to credit loss on any available-for-sale marketable securities as of March 31, 2025[41](index=41&type=chunk) [5. Fair Value of Financial Instruments](index=12&type=section&id=5.%20Fair%20Value%20of%20Financial%20Instruments) Presents the fair value measurements of financial assets and liabilities, categorized by valuation input levels Financial Assets and Liabilities at Fair Value (dollars in thousands) as of March 31, 2025 | Asset/Liability | Total | Level 1 | Level 2 | Level 3 | | :-------------------------------- | :------ | :------ | :------ | :------ | | Cash and cash equivalents | $115,848 | $115,848 | $— | $— | | Marketable securities | $347,742 | $— | $347,742 | $— | | Marketable securities - restricted (SERP) | $617 | $23 | $594 | $— | | Contingent consideration | $30,000 | $30,000 | $— | $— | - Contingent consideration liability was **$30.0 million** as of March 31, 2025, classified as Level 1, a change from Level 3 at December 31, 2024[43](index=43&type=chunk)[46](index=46&type=chunk)[47](index=47&type=chunk) - The fair value of accounts receivable, accounts payable, and accrued expenses approximates their carrying amounts due to short-term maturities[45](index=45&type=chunk) [6. Contingent Consideration](index=14&type=section&id=6.%20Contingent%20Consideration) Details the company's contingent consideration liabilities, including changes in fair value and milestone payment expectations Contingent Consideration (dollars in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :-------------------------------- | :------------- | :---------------- | | Contingent consideration, current portion | $30,000 | $47,340 | | Total | $30,000 | $47,340 | - The remaining **$30 million** USWM contingent consideration payment related to ONAPGO's commercial launch is expected to be due and paid in 2025, following its FDA approval in February 2025 and launch in April 2025[47](index=47&type=chunk) - The 2024 Milestone for Adamas Acquisition's GOCOVRI sales was not met, and the probability of achieving the 2025 Milestone (**$225 million** in aggregate worldwide net sales) is remote as of March 31, 2025[50](index=50&type=chunk)[51](index=51&type=chunk) - A **$7.7 million** expense was recorded in Q1 2025 due to the change in fair value of USWM contingent consideration liabilities, primarily from accretion to the full milestone payment amount upon ONAPGO's approval[52](index=52&type=chunk) [7. Intangible Assets, Net](index=16&type=section&id=7.%20Intangible%20Assets%2C%20Net) Provides a breakdown of intangible assets, including acquired technology, product rights, and amortization expenses Intangible Assets, Net (dollars in thousands) | Asset Type | March 31, 2025 (Net) | December 31, 2024 (Net) | | :-------------------------------- | :------------------- | :-------------------- | | Acquired developed technology and product rights | $502,126 | $397,912 | | Capitalized patent defense costs | $— | $— | | Acquired in-process research and development | $— | $124,000 | | Total intangible assets | $502,126 | $521,912 | - Amortization expense for intangible assets was **$19.8 million** for Q1 2025, a slight decrease from **$20.1 million** in Q1 2024[54](index=54&type=chunk) - Upon FDA approval of ONAPGO in February 2025, its acquired in-process research and development asset was reclassified as a definite-life intangible asset subject to 10-year amortization[55](index=55&type=chunk) - U.S. patents for Trokendi XR and Oxtellar XR expire no earlier than 2027, with generic entry for Trokendi XR in January 2023 and Oxtellar XR in September 2024[56](index=56&type=chunk) [8. Debt](index=16&type=section&id=8.%20Debt) Details the company's debt arrangements, including its uncommitted demand secured line of credit - The company has an uncommitted demand secured line of credit of up to **$150 million** with UBS, secured by certain assets[57](index=57&type=chunk)[58](index=58&type=chunk) - As of March 31, 2025, and December 31, 2024, there was no outstanding debt under the Credit Line[61](index=61&type=chunk) [9. Share-Based Payments](index=18&type=section&id=9.%20Share-Based%20Payments) Reports on share-based compensation expense, outstanding stock options, and restricted stock units Share-Based Compensation Expense (dollars in thousands) | Expense Type | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Research and development | $1,412 | $1,365 | | Selling, general and administrative | $6,656 | $4,532 | | Total | $8,068 | $5,897 | - Total share-based compensation expense increased by **36.8%** to **$8.1 million** in Q1 2025 from **$5.9 million** in Q1 2024[62](index=62&type=chunk) - As of March 31, 2025, **7,649,242** stock options were outstanding with a weighted average exercise price of **$31.01**, and **407,867** restricted stock units (RSUs) were nonvested[62](index=62&type=chunk)[63](index=63&type=chunk) [10. Earnings (Loss) per Share](index=19&type=section&id=10.%20Earnings%20%28Loss%29%20per%20Share) Presents basic and diluted earnings per share calculations, including the impact of anti-dilutive securities Earnings (Loss) per Share | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Net earnings (loss) | $(11,827) | $124 | | Weighted average shares outstanding, basic | 55,864,692 | 54,801,748 | | Weighted average shares outstanding, diluted | 55,864,692 | 55,626,663 | | Earnings (Loss) per share, basic | $(0.21) | $0.00 | | Earnings (Loss) per share, diluted | $(0.21) | $0.00 | - Basic and diluted earnings per share were **$(0.21)** for Q1 2025, compared to **$0.00** for Q1 2024, reflecting the net loss[65](index=65&type=chunk) - **505,385** stock options and stock awards were excluded from diluted EPS calculation in Q1 2025 as their inclusion would be anti-dilutive[65](index=65&type=chunk) [11. Income Tax Expense](index=19&type=section&id=11.%20Income%20Tax%20Expense) Reports the income tax expense and effective tax rate for the reporting periods, explaining significant changes Income Tax Expense (dollars in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Income tax expense | $5,996 | $119 | | Effective tax rate | (102.8)% | 49.0% | - Income tax expense significantly increased to **$6.0 million** in Q1 2025 from **$0.1 million** in Q1 2024, resulting in an effective tax rate of **(102.8)%** due to near break-even pre-tax losses[66](index=66&type=chunk)[67](index=67&type=chunk)[68](index=68&type=chunk) [12. Leases](index=20&type=section&id=12.%20Leases) Details the company's operating lease assets and liabilities, including current and long-term portions Operating Lease Assets and Liabilities (dollars in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :-------------------------------- | :------------- | :---------------- | | Operating lease assets | $22,724 | $24,477 | | Operating lease liabilities, current portion | $5,937 | $6,889 | | Operating lease liabilities, long-term | $26,368 | $27,382 | | Total lease liabilities | $32,305 | $34,271 | [13. Segment Reporting](index=20&type=section&id=13.%20Segment%20Reporting) Describes the company's operating segments and how performance is assessed and resources are allocated - The company operates in one operating segment, deriving revenue primarily from commercial product sales in the U.S.[71](index=71&type=chunk) - The Chief Executive Officer, as the chief operating decision maker (CODM), assesses performance and allocates resources based on net income (loss)[72](index=72&type=chunk) Segment Revenue and Significant Expenses (dollars in thousands) | Metric | March 31, 2025 | March 31, 2024 | | :-------------------------------- | :------------- | :------------- | | Total revenues | $149,824 | $143,644 | | Cost of goods sold | $15,763 | $16,309 | | Selling | $42,614 | $39,014 | | Marketing | $20,664 | $20,553 | | General and administrative | $26,666 | $26,949 | | Total research and development expenses | $26,927 | $24,930 | | Net earnings (loss) | $(11,827) | $124 | [14. Composition of Other Balance Sheet Items](index=21&type=section&id=14.%20Composition%20of%20Other%20Balance%20Sheet%20Items) Provides detailed breakdowns of inventories, accounts payable, accrued liabilities, and product returns and rebates Inventories, Net (dollars in thousands) | Category | March 31, 2025 | December 31, 2024 | | :---------------- | :------------- | :---------------- | | Raw materials | $8,664 | $11,127 | | Work in process | $18,694 | $26,725 | | Finished goods | $22,065 | $16,441 | | Total | $49,423 | $54,293 | Accounts Payable and Accrued Liabilities (dollars in thousands) | Category | March 31, 2025 | December 31, 2024 | | :-------------------------------- | :------------- | :---------------- | | Accounts payable | $7,072 | $4,587 | | Accrued compensation, benefits, & related accruals | $17,596 | $21,225 | | Accrued sales & marketing | $14,832 | $11,007 | | Accrued manufacturing expenses | $11,067 | $11,652 | | Accrued R&D expenses | $5,413 | $5,898 | | Operating lease liabilities, current portion | $5,937 | $6,889 | | Accrued royalties | $6,250 | $8,105 | | Other accrued expenses | $8,724 | $6,989 | | Total | $76,891 | $76,352 | Accrued Product Returns and Rebates (dollars in thousands) | Category | March 31, 2025 | December 31, 2024 | | :---------------- | :------------- | :---------------- | | Accrued product rebates | $120,208 | $115,330 | | Accrued product returns | $49,925 | $53,375 | | Total | $170,133 | $168,705 | [15. Commitments and Contingencies](index=22&type=section&id=15.%20Commitments%20and%20Contingencies) Outlines the company's contractual obligations, potential milestone payments, and ongoing legal proceedings - The company has product licenses requiring milestone payments and royalties on net product sales[79](index=79&type=chunk)[80](index=80&type=chunk) - Under the Navitor Development Agreement for SPN-820, the company has committed up to **$50 million** for Phase I and Phase II development costs and has the potential for total payments of **$410 million** to **$475 million** contingent on milestones[82](index=82&type=chunk)[85](index=85&type=chunk) - The company assumed an annual minimum purchase requirement of estimated **€3.9 million** for MYOBLOC under a contract manufacturing agreement[87](index=87&type=chunk) - The company was released from its obligations under the Corporate Integrity Agreement (CIA) in April 2025, which was assumed as part of the USWM Acquisition[88](index=88&type=chunk) - Ongoing legal proceedings include the NAMENDA XR/Namzaric Qui Tam Litigation, where the Ninth Circuit affirmed dismissal of the federal FCA claim in January 2025, and the APOKYN Litigation, an antitrust lawsuit with mediation held in April 2025 that did not result in settlement[91](index=91&type=chunk)[92](index=92&type=chunk)[93](index=93&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial performance and condition for the three months ended March 31, 2025, compared to the same period in 2024. It covers an overview of the business, commercial products, research and development pipeline, commercial highlights, critical accounting policies, detailed results of operations, financial condition, liquidity, and capital resources, and recently issued accounting pronouncements [Overview](index=28&type=section&id=Overview) Provides a high-level summary of the company's business, therapeutic focus, and product development strategy - Supernus Pharmaceuticals is a biopharmaceutical company focused on developing and commercializing products for central nervous system (CNS) diseases[99](index=99&type=chunk) - The company's neuroscience portfolio includes approved treatments for ADHD, Parkinson's Disease (PD) dyskinesia and hypomobility, epilepsy, migraine, cervical dystonia, and chronic sialorrhea[99](index=99&type=chunk) - A broad range of novel CNS product candidates are under development for epilepsy, depression, and other CNS disorders[99](index=99&type=chunk) [Commercial Products](index=28&type=section&id=Commercial%20Products) Lists and describes the company's currently marketed pharmaceutical products and their indications - Qelbree (viloxazine) extended-release capsules are indicated for ADHD in adults and pediatric patients 6 years and older; an expanded label update was approved in January 2025[101](index=101&type=chunk) - ONAPGO (apomorphine hydrochloride) injection, approved by the FDA in February 2025 and launched in April 2025, is the first and only subcutaneous apomorphine infusion device for motor fluctuations in advanced PD[101](index=101&type=chunk) - Other commercial products include GOCOVRI for PD dyskinesia and 'OFF' episodes, Oxtellar XR and Trokendi XR for epilepsy and migraine prophylaxis, APOKYN for PD hypomobility, XADAGO for PD 'OFF' episodes, and MYOBLOC for cervical dystonia and chronic sialorrhea[101](index=101&type=chunk) [Research and Development](index=29&type=section&id=Research%20and%20Development) Outlines the company's pipeline of product candidates, their indications, and current development status Key R&D Programs and Status | Program | Indications | Status | | :------ | :---------- | :----- | | ONAPGO | PD | Approved in February 2025 - Launched in 2Q 2025 | | SPN-817 | Epilepsy | In clinical development, received Orphan Drug Designation | | SPN-820 | Depression | Phase 2b study did not show statistical significance on primary/secondary endpoints | | SPN-443 | ADHD/CNS | Completed Phase 1 study, showed adequate bioavailability and tolerability | | SPN-449 | CNS | Preclinical | | SPN-443 | ADHD/CNS | Completed Phase 1 pharmacokinetic study, lead indication expected by end of 2025 | - SPN-817, a novel anticonvulsant for epilepsy, is in Phase 2b study targeting **258** adult patients with treatment-resistant focal seizures[103](index=103&type=chunk)[108](index=108&type=chunk) - For SPN-820 in depression, a Phase 2b study did not meet statistical significance, but the company plans a follow-on Phase 2b trial for Major Depressive Disorder (MDD) with intermittent dosing[105](index=105&type=chunk)[109](index=109&type=chunk) [Commercial Highlights](index=30&type=section&id=Commercial%20Highlights) Summarizes key commercial achievements and market performance indicators for the company's products - Total IQVIA prescriptions for Qelbree increased by **22%** to **214,908** in Q1 2025 compared to the prior year, with monthly prescriptions reaching an all-time high of **75,277** in March 2025[112](index=112&type=chunk) - Qelbree's prescriber base expanded to approximately **34,416** in Q1 2025, up from **27,902** in the same period last year[112](index=112&type=chunk) - ONAPGO was launched in April 2025, with initial physician response described as encouraging[112](index=112&type=chunk) [Critical Accounting Policies and the Use of Estimates](index=30&type=section&id=Critical%20Accounting%20Policies%20and%20the%20Use%20of%20Estimates) Discusses the accounting policies that require significant judgment and estimates in financial reporting - There were no significant changes to the company's critical accounting policies as disclosed in its Annual Report on Form 10-K for the year ended December 31, 2024[111](index=111&type=chunk) [Results of Operations](index=31&type=section&id=Results%20of%20Operations) Analyzes the company's financial performance, including revenues, expenses, and profitability, for the reporting periods [Revenues](index=31&type=section&id=Revenues) Examines the sources and changes in total revenues, including net product sales and royalty income Revenues (dollars in thousands) | Revenue Type | Q1 2025 | Q1 2024 | Change Amount | Change Percent | | :-------------------------------- | :------ | :------ | :------------ | :------------- | | Net product sales | $141,988 | $138,461 | $3,527 | 3% | | Royalty, licensing and other revenues | $7,836 | $5,183 | $2,653 | 51% | | Total revenues | $149,824 | $143,644 | $6,180 | 4% | - Total revenues increased by **4%** to **$149.8 million** in Q1 2025, driven by increases in both net product sales and royalty/licensing revenues[113](index=113&type=chunk) [Net Product Sales](index=31&type=section&id=Net%20Product%20Sales) Provides a detailed breakdown of net product sales by individual product and analyzes their year-over-year changes Net Product Sales by Product (dollars in thousands) | Product | Q1 2025 | Q1 2024 | Change Amount | Change Percent | | :---------------- | :------ | :------ | :------------ | :------------- | | Qelbree | $64,745 | $45,104 | $19,641 | 44% | | GOCOVRI | $30,689 | $26,562 | $4,127 | 16% | | APOKYN | $14,976 | $16,649 | $(1,673) | (10)% | | Trokendi XR | $12,801 | $15,989 | $(3,188) | (20)% | | Oxtellar XR | $10,198 | $26,943 | $(16,745) | (62)% | | Other | $8,579 | $7,214 | $1,365 | 19% | | Total net product sales | $141,988 | $138,461 | $3,527 | 3% | - Net product sales increased by **3%** to **$142.0 million** in Q1 2025, primarily due to higher volume and price for Qelbree and GOCOVRI[114](index=114&type=chunk) - The increase was partially offset by declines in Oxtellar XR and Trokendi XR sales due to generic erosion[114](index=114&type=chunk) - Adjustments for prior year sales returns were less than **5%** of net product sales in Q1 2025, mainly attributable to Qelbree's favorable actual returns experience[115](index=115&type=chunk) [Sales Deductions and Related Accruals](index=31&type=section&id=Sales%20Deductions%20and%20Related%20Accruals) Analyzes changes in accrued product returns, rebates, and sales discounts, and their impact on net product sales Accrued Product Returns and Rebates Activity (dollars in thousands) | Metric | Balance Dec 31, 2024 | Provision Current Year | Provision Prior Year | Actual Payments/Credits | Balance Mar 31, 2025 | | :-------------------------------- | :------------------- | :--------------------- | :------------------- | :---------------------- | :------------------- | | Accrued Product Returns | $53,375 | $4,645 | $(6,988) | $(1,107) | $49,925 | | Accrued Product Rebates | $115,330 | $104,957 | $253 | $(100,332) | $120,208 | | Sales Discounts | $12,347 | $16,680 | $99 | $(15,362) | $13,764 | | Total | $181,052 | $126,282 | $(6,636) | $(116,801) | $183,897 | - Accrued product returns decreased to **$49.9 million** as of March 31, 2025, primarily due to a **$7.0 million** estimated provision for prior year sales returns, mainly from Qelbree's favorable experience[120](index=120&type=chunk) - Accrued product rebates increased to **$120.2 million** as of March 31, 2025, primarily due to the timing of payments associated with government programs[121](index=121&type=chunk) - The provision for product rebates increased to **$105.2 million** in Q1 2025, driven by higher Qelbree sales and unfavorable government programs due to Q1 2025 product price increases[123](index=123&type=chunk) [Royalty, Licensing and Other Revenues](index=32&type=section&id=Royalty%2C%20Licensing%20and%20Other%20Revenues) Discusses the growth and drivers of royalty, licensing, and other revenue streams for the period - Royalty, licensing and other revenues increased by **51%** to **$7.8 million** in Q1 2025 from **$5.2 million** in Q1 2024, primarily due to increased royalty revenues from Oxtellar XR[124](index=124&type=chunk) [Cost of Goods Sold](index=33&type=section&id=Cost%20of%20Goods%20Sold) Analyzes the changes in the cost of products sold and the factors influencing these costs - Cost of goods sold decreased to **$15.8 million** in Q1 2025 from **$16.3 million** in Q1 2024, mainly due to lower APOKYN royalties and declining net product sales of Oxtellar XR and Trokendi XR from generic erosion[125](index=125&type=chunk) [Research and Development Expenses](index=33&type=section&id=Research%20and%20Development%20Expenses) Examines the trends and drivers of research and development expenditures, including clinical program costs - Research and development (R&D) expenses increased to **$26.9 million** in Q1 2025 from **$24.9 million** in Q1 2024, primarily due to higher clinical program costs for SPN-817 and the Qelbree open-label study[126](index=126&type=chunk) [Selling, General and Administrative Expenses](index=33&type=section&id=Selling%2C%20General%20and%20Administrative%20Expenses) Analyzes the components and changes in selling, general, and administrative expenses for the reporting periods Selling, General and Administrative (SG&A) Expenses (dollars in thousands) | Expense Type | Q1 2025 | Q1 2024 | Change Amount | Change Percent | | :-------------------------------- | :------ | :------ | :------------ | :------------- | | Selling and marketing | $63,278 | $59,567 | $3,711 | 6% | | General and administrative | $26,666 | $26,949 | $(283) | (1)% | | Total | $89,944 | $86,516 | $3,428 | 4% | - Total SG&A expenses increased by **4%** to **$89.9 million** in Q1 2025, mainly driven by a **6%** increase in selling and marketing expenses due to the timing of product sample shipments[127](index=127&type=chunk) [Amortization of Intangible Assets](index=33&type=section&id=Amortization%20of%20Intangible%20Assets) Discusses the amortization expense related to intangible assets and the factors influencing its changes - Amortization of intangible assets decreased slightly to **$19.8 million** in Q1 2025 from **$20.1 million** in Q1 2024[128](index=128&type=chunk) - The decrease was due to Oxtellar XR and Namzaric intangible assets being fully amortized in 2024, partially offset by new ONAPGO amortization expense in 2025[128](index=128&type=chunk) [Contingent Consideration Loss (Gain)](index=33&type=section&id=Contingent%20Consideration%20Loss%20%28Gain%29) Explains the contingent consideration loss or gain recognized and the events driving its change - The company recorded a contingent consideration loss of **$7.7 million** in Q1 2025, a significant change from a **$1.1 million** gain in Q1 2024[129](index=129&type=chunk) - This change was primarily driven by the accretion of USWM contingent consideration liabilities to the full milestone payment amounts following ONAPGO's FDA approval in February 2025[129](index=129&type=chunk) [Other Income (Expense)](index=33&type=section&id=Other%20Income%20%28Expense%29) Reports on other non-operating income and expenses, such as interest income, and their impact on results - Other income increased to **$4.4 million** in Q1 2025 from **$3.4 million** in Q1 2024, primarily due to higher interest income on marketable securities from an overall higher investment balance[130](index=130&type=chunk) [Income Tax Expense](index=33&type=section&id=Income%20Tax%20Expense) Analyzes the income tax expense and effective tax rate, explaining the factors contributing to their changes - Income tax expense was **$6.0 million** in Q1 2025 (effective tax rate of **(102.8)%**) compared to **$0.1 million** in Q1 2024 (effective tax rate of **49.0%**)[131](index=131&type=chunk) - The change was primarily due to near break-even pre-tax losses in Q1 2025 and the full year 2025 forecast, compared to the same periods in 2024[131](index=131&type=chunk) [Financial Condition, Liquidity and Capital Resources](index=34&type=section&id=Financial%20Condition%2C%20Liquidity%20and%20Capital%20Resources) Assesses the company's financial health, ability to meet short-term obligations, and sources of funding [Cash and Cash Equivalents and Marketable Securities](index=34&type=section&id=Cash%20and%20Cash%20Equivalents%20and%20Marketable%20Securities) Reports on the total cash, cash equivalents, and marketable securities, and their changes over the period Cash and Cash Equivalents and Marketable Securities (dollars in thousands) | Metric | March 31, 2025 | December 31, 2024 | Change Amount | Change Percent | | :-------------------------------- | :------------- | :---------------- | :------------ | :------------- | | Cash and cash equivalents | $115,848 | $69,331 | $46,517 | 67% | | Marketable securities | $347,742 | $384,281 | $(36,539) | (10)% | | Total | $463,590 | $453,612 | $9,978 | 2% | - Total cash, cash equivalents, and unrestricted marketable securities increased by **2%** to **$463.6 million** as of March 31, 2025[134](index=134&type=chunk) - The company believes its current cash balances, cash from operations, and access to debt markets will be sufficient to meet cash requirements for the next 12 months and beyond[134](index=134&type=chunk) - Future profitability may vary significantly due to market pressures, loss of patent exclusivity for Trokendi XR and Oxtellar XR, upcoming loss of exclusivity for XADAGO, R&D funding, and ONAPGO launch costs[135](index=135&type=chunk) [Cash Flows](index=34&type=section&id=Cash%20Flows) Provides a summary of cash flows from operating, investing, and financing activities for the reporting periods Cash Flows Summary (dollars in thousands) | Activity | Q1 2025 | Q1 2024 | Change Amount | | :-------------------------------- | :------ | :------ | :------------ | | Net cash provided by (used in) operating activities | $30,599 | $38,401 | $(7,802) | | Net cash provided by (used in) investing activities | $37,317 | $(51,624) | $88,941 | | Net cash provided by (used in) financing activities | $(21,399) | $1,570 | $(22,969) | | Net change in cash and cash equivalents | $46,517 | $(11,653) | $58,170 | | Cash and cash equivalents at end of period | $115,848 | $63,401 | $52,447 | [Operating Activities](index=34&type=section&id=Operating%20Activities) Analyzes the net cash generated or used by the company's primary business operations - Net cash provided by operating activities decreased to **$30.6 million** in Q1 2025 from **$38.4 million** in Q1 2024[138](index=138&type=chunk) - The decrease was primarily due to lower net income and changes in working capital, reflecting timing impacts of cash collections and payable settlements[138](index=138&type=chunk)[139](index=139&type=chunk) [Investing Activities](index=35&type=section&id=Investing%20Activities) Examines the cash flows related to the acquisition and disposal of long-term assets and investments - Net cash provided by investing activities was **$37.3 million** in Q1 2025, a significant shift from **$51.6 million** cash used in Q1 2024[140](index=140&type=chunk) - This change was mainly due to decreased cash outflows from purchases of marketable securities and higher cash inflows from maturities of marketable securities[140](index=140&type=chunk) [Financing Activities](index=35&type=section&id=Financing%20Activities) Reports on cash flows from debt, equity, and dividend transactions, and other financing-related activities - Net cash used in financing activities was **$21.4 million** in Q1 2025, compared to **$1.6 million** provided in Q1 2024[141](index=141&type=chunk) - The change was primarily due to the payment of the USWM contingent consideration milestone associated with the FDA approval of ONAPGO[141](index=141&type=chunk) [Material Cash Requirements](index=35&type=section&id=Material%20Cash%20Requirements) Refers to disclosures regarding significant future cash obligations and commitments - Material cash requirements are discussed in the Annual Report on Form 10-K for the year ended December 31, 2024, and Note 15, Commitments and Contingencies, in this report[142](index=142&type=chunk) [Recently Issued Accounting Pronouncements](index=35&type=section&id=Recently%20Issued%20Accounting%20Pronouncements) Summarizes new accounting standards and their potential impact on the company's financial statements - For a discussion of new accounting pronouncements, refer to Note 2, Summary of Significant Accounting Policies, in the Notes to the Condensed Consolidated Financial Statements[143](index=143&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=35&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section outlines the company's exposure to market risks, primarily related to investments in cash, cash equivalents, and marketable securities, as well as potential interest rate risk from its credit line. It also addresses foreign currency exchange rate risk and the impact of inflation - The company's primary investment objective is to preserve capital and maximize income from investments in investment-grade securities with maturities of four years or less[144](index=144&type=chunk)[146](index=146&type=chunk) - As of March 31, 2025, cash, cash equivalents, and marketable securities totaled **$463.6 million**[144](index=144&type=chunk) - Variable rate borrowing under the **$150 million** Credit Line exposes the company to interest rate risk, and collateral maintenance requirements could necessitate posting additional collateral if asset values decline[145](index=145&type=chunk) - The company does not hedge foreign currency exchange rate risk and does not believe inflation had a significant impact on Q1 2025 results, but acknowledges potential future impacts on labor and vendor costs[147](index=147&type=chunk)[149](index=149&type=chunk) [Item 4. Controls and Procedures](index=37&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details the evaluation of the company's disclosure controls and procedures and reports on any changes in internal control over financial reporting during the quarter ended March 31, 2025 - The company's disclosure controls and procedures were evaluated and deemed effective as of March 31, 2025[150](index=150&type=chunk) - No changes occurred in internal control over financial reporting during Q1 2025 that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[151](index=151&type=chunk) [PART II — OTHER INFORMATION](index=37&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) This section provides disclosures on legal proceedings, risk factors, equity sales, and other miscellaneous information [Item 1. Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) This section provides updates on various legal proceedings involving Supernus Pharmaceuticals, Inc., including patent infringement lawsuits related to Trokendi XR, an antitrust lawsuit concerning APOKYN, and a qui tam complaint against Adamas related to NAMENDA XR and Namzaric - In the Trokendi XR litigation, the company settled with Ajanta and won a trial against Torrent, with the District Court ruling in Supernus's favor on patent validity and infringement; Torrent filed an appeal with the U.S. Court of Appeals for the Federal Circuit[155](index=155&type=chunk)[156](index=156&type=chunk)[157](index=157&type=chunk) - The APOKYN antitrust litigation is ongoing, with a mediation held in April 2025 that did not result in settlement, and a jury trial scheduled for January 2026[158](index=158&type=chunk)[159](index=159&type=chunk) - In the Adamas Qui Tam Litigation, the Ninth Circuit affirmed the District Court's dismissal of the Federal False Claims Act claim in January 2025, and the plaintiff's petition for rehearing was denied in April 2025[167](index=167&type=chunk) [Item 1A. Risk Factors](index=41&type=section&id=Item%201A.%20Risk%20Factors) This section highlights substantive changes or additions to the risk factors previously disclosed in the company's Annual Report on Form 10-K, specifically addressing the potential impact of tariffs on costs - New risk factors include the potential for tariffs to increase costs, as the company relies on international suppliers and vendors for active product ingredients and raw materials[171](index=171&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=41&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section states that there were no unregistered sales of equity securities during the reporting period - There were no unregistered sales of equity securities during the period[172](index=172&type=chunk) [Item 3. Defaults Upon Senior Securities](index=41&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section confirms that there were no defaults upon senior securities during the reporting period - There were no defaults upon senior securities during the period[172](index=172&type=chunk) [Item 4. Mine Safety Disclosures](index=41&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section indicates that there are no mine safety disclosures to report - There are no mine safety disclosures to report[172](index=172&type=chunk) [Item 5. Other Information](index=41&type=section&id=Item%205.%20Other%20Information) This section provides information on insider trading arrangements and policies, specifically detailing a Rule 10b5-1 trading arrangement adopted by Charles Newhall Insider Trading Arrangements Adopted in Q1 2025 | Name and Title | Rule 10b5-1 Trading Arrangement | Trading Arrangement Adopted or Terminated | Date of Adoption or Termination | Duration of Trading Arrangement | Aggregate Number of Securities to be Purchased | Aggregate Number of Securities to be Sold | | :------------- | :------------------------------ | :-------------------------------------- | :------------------------------ | :------------------------------ | :--------------------------------------------- | :------------------------------------------ | | Charles Newhall | Yes | Adopted | March 3, 2025 | 3/3/2027 | 31,000 | 31,000 | [Item 6. Exhibits](index=42&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed or furnished as part of the Quarterly Report on Form 10-Q, including certifications, financial information in Inline XBRL, and the cover page - Exhibits include CEO and CFO certifications (Rule 13a-14(a) and 18 U.S.C. Section 1350), and financial information formatted in Inline XBRL[174](index=174&type=chunk) [SIGNATURES](index=43&type=section&id=SIGNATURES) This section contains the signatures of the registrant's authorized officers, including the President and Chief Executive Officer, and the Senior Vice-President and Chief Financial Officer, certifying the report - The report is signed by Jack A. Khattar, President and Chief Executive Officer, and Timothy C. Dec, Senior Vice-President and Chief Financial Officer, on May 6, 2025[178](index=178&type=chunk)