PART I – FINANCIAL INFORMATION Financial Statements (Unaudited) Presents Cumberland Pharmaceuticals Inc.'s unaudited condensed consolidated financial statements for Q1 2025, including balance sheets, operations, cash flows, and equity Condensed Consolidated Balance Sheets Total assets decreased to $69.9 million, liabilities reduced to $41.6 million, and equity increased to $28.3 million by Q1 2025 Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $15,108 | $17,964 | | Total current assets | $31,877 | $36,452 | | Total assets | $69,936 | $75,583 | | Liabilities & Equity | | | | Total current liabilities | $25,520 | $31,622 | | Revolving line of credit - long term | $5,241 | $10,176 | | Total liabilities | $41,595 | $53,037 | | Total equity | $28,341 | $22,546 | Condensed Consolidated Statements of Operations Q1 2025 net income of $1.25 million on $11.7 million net revenues marks a significant turnaround from the prior year's loss Q1 2025 vs. Q1 2024 Statement of Operations (in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net revenues | $11,713 | $8,498 | | Total costs and expenses | $10,421 | $10,367 | | Operating income (loss) | $1,292 | $(1,869) | | Net income (loss) | $1,248 | $(1,902) | | Diluted EPS | $0.08 | $(0.14) | Condensed Consolidated Statements of Cash Flows Q1 2025 operating activities provided $3.9 million cash, reversing a prior year use, resulting in a $2.9 million overall cash decrease Q1 2025 vs. Q1 2024 Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $3,899 | $(2,137) | | Net cash used in investing activities | $(1,228) | $(58) | | Net cash provided by (used in) financing activities | $(5,526) | $2,422 | | Net (decrease) increase in cash | $(2,856) | $227 | - Financing activities in Q1 2025 included $5.3 million in net proceeds from an At-the-Market (ATM) offering and $10.0 million in payments on the line of credit13 Notes to the Condensed Consolidated Financial Statements Notes detail accounting policies and financial statement items, including product revenues, inventory, lease, debt, and contingent liabilities Net Revenues by Product (in thousands) | Product | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Kristalose | $3,484 | $3,196 | | Sancuso | $2,256 | $1,828 | | Vibativ | $1,378 | $1,605 | | Caldolor | $1,307 | $1,471 | | Other revenue | $3,142 | $275 | | Total net revenues | $11,713 | $8,498 | - Other revenue in Q1 2025 includes a $3.0 million milestone payment related to the approval of Vibativ for the Chinese market41 - On February 5, 2025, the Company issued 1,000,000 shares under an At-the-Market (ATM) program for an aggregate amount of $5.5 million57 - As of March 31, 2025, the company had $5.2 million in borrowings outstanding under its revolving credit facility with Pinnacle Bank at an interest rate of 7.125%62 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q1 2025's profitability turnaround, driven by $11.7 million net revenue, outlining growth strategy and solid liquidity Growth Strategy The company's growth strategy focuses on maximizing existing brands, acquiring new ones, advancing its clinical pipeline, and building international partnerships - Cumberland's growth strategy includes: - Supporting and expanding the use of its marketed products - Selectively acquiring complementary brands and late-stage candidates - Progressing its clinical pipeline, including ifetroban Phase II programs - Leveraging infrastructure through co-promotion partnerships - Building an international business through a network of partners9091 Recent Developments Recent developments include Acetadote FDA approval, positive Caldolor and ifetroban study results, and Vibativ's China approval and Saudi launch - The FDA approved a supplemental New Drug Application for Acetadote, simplifying its dosing regimen to reduce medication errors9293 - A new study of 150,000 patients showed Caldolor was associated with significantly reduced adverse drug reactions compared to ketorolac9495 - The company announced positive top-line results from its Phase II study of ifetroban in patients with Duchenne muscular dystrophy (DMD)97 - Vibativ received regulatory approval in China, and the company began shipping the product to Saudi Arabia for its launch100101 Results of Operations Net revenues for Q1 2025 increased by 38% to $11.7 million, primarily due to a $3.0 million Vibativ milestone, resulting in $1.3 million operating income Q1 2025 vs. Q1 2024 Operations Summary (in thousands) | Line Item | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net revenues | $11,713 | $8,498 | $3,215 | | Cost of products sold | $1,426 | $1,576 | $(150) | | Operating income (loss) | $1,292 | $(1,869) | $3,161 | | Net income (loss) | $1,248 | $(1,902) | $3,151 | - The increase in Other Revenue from $0.3 million to $3.1 million was driven by a $3 million milestone payment for Vibativ's approval in China116 - Sancuso revenue increased by $0.4 million due to increased shipments and lower sales deductions115 Financial Contribution of Vibativ and Sancuso (in thousands) | Product Contribution | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Vibativ | | | | Net Revenue* | $4,353 | $1,605 | | Contribution | $3,594 | $850 | | Sancuso | | | | Net Revenue | $2,256 | $1,828 | | Contribution | $1,183 | $1,043 | *Vibativ Q1 2025 Net Revenue includes a $2,975,000 milestone payment. Liquidity and Capital Resources Liquidity is sourced from cash, operations, and a revolving credit line, with working capital improving to $6.4 million and $15.1 million cash by Q1 2025 Liquidity and Working Capital Summary (in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $15,108 | $17,964 | | Working capital | $6,358 | $4,830 | | Revolving line of credit availability | $14,759 | $4,724 | - Cash provided by operating activities was $3.9 million for Q1 2025, a significant improvement from a $2.1 million use of cash in Q1 2024125126 - Cash used in financing activities was $5.5 million, primarily due to $10.0 million in payments on the line of credit, offset by $5.3 million in proceeds from an ATM offering127 Quantitative and Qualitative Disclosures About Market Risk The company faces interest rate risk on its variable-rate credit facility, with minimal foreign currency exchange risk due to primarily U.S. operations - The company is exposed to interest rate risk on its revolving credit facility, which is based on Term SOFR plus a spread. The applicable rate was 7.125% at March 31, 2025, on $5.2 million of outstanding borrowings133 - Foreign currency exchange risk is considered minimal as operations are primarily in the United States and exposure is limited134 Controls and Procedures The CEO and CFO concluded disclosure controls and procedures were effective as of March 31, 2025, with no material changes in internal control over financial reporting - Management, including the CEO and CFO, concluded that the Company's disclosure controls and procedures were effective as of March 31, 2025135 - No changes in internal control over financial reporting occurred during Q1 2025 that materially affected, or are reasonably likely to materially affect, internal controls136 PART II – OTHER INFORMATION Legal Proceedings The company is involved in litigation but does not expect a material adverse effect on its business or financial condition - The Company does not believe that the disposition or ultimate resolution of existing claims or lawsuits will have a material adverse effect on its business or financial condition66 Risk Factors This section refers investors to the risk factors detailed in the Company's Annual Report on Form 10-K for 2024 - Investors are directed to consider the risk factors included in the Company's Annual Report on Form 10-K for the year ended December 31, 2024139 Unregistered Sales of Equity Securities and Use of Proceeds The company repurchased 53,837 shares for $0.2 million in Q1 2025 under its $10 million program, with $2.2 million remaining available - During Q1 2025, the Company repurchased 53,837 shares of common stock for approximately $0.2 million55 Share Repurchases in Q1 2025 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | January | 15,770 | $2.51 | | February | — | — | | March | 38,067 | $5.36 | | Total | 53,837 | | - As of March 31, 2025, approximately $2.2 million remained available for future repurchases under the current program55 Other Information Several officers and directors adopted Rule 10b5-1 trading plans to purchase company stock, effective March 2025 through year-end - The CEO and several directors adopted Rule 10b5-1 trading plans to purchase company stock, which became effective on March 3, 2025142 Exhibits This section lists exhibits filed with the Form 10-Q, including employment agreements and CEO/CFO certifications - The report includes various exhibits, such as CEO and CFO certifications (31.1, 31.2, 32.1) and Inline XBRL data files143
Cumberland Pharmaceuticals(CPIX) - 2025 Q1 - Quarterly Report