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DELAWARE
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94-3229046
|
(STATE OR OTHER JURISDICTION OF
INCORPORATION OR ORGANIZATION)
|
(I.R.S. EMPLOYER IDENTIFICATION NUMBER)
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Title of each class:
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Trading Symbol(s):
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|
Name of each exchange on which registered:
|
Common Stock, $0.0001 par value
|
|
ASRT
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The NASDAQ Stock Market LLC
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Large accelerated filer
o
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Accelerated filer
x
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Non-accelerated filer
o
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Smaller reporting company
o
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Emerging growth company
o
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Item 1.
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Item 1A.
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Item 6.
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March 31, 2019
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December 31, 2018
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||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
109,691
|
|
|
$
|
110,949
|
|
Accounts receivable, net
|
43,488
|
|
|
37,211
|
|
||
Inventories, net
|
3,077
|
|
|
3,396
|
|
||
Prepaid and other current assets
|
25,726
|
|
|
56,551
|
|
||
Total current assets
|
181,982
|
|
|
208,107
|
|
||
Property and equipment, net
|
16,625
|
|
|
13,064
|
|
||
Intangible assets, net
|
666,655
|
|
|
692,099
|
|
||
Investments
|
10,362
|
|
|
11,784
|
|
||
Other long-term assets
|
7,840
|
|
|
7,812
|
|
||
Total assets
|
$
|
883,464
|
|
|
$
|
932,866
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
5,421
|
|
|
$
|
6,138
|
|
Accrued rebates, returns and discounts
|
71,655
|
|
|
75,759
|
|
||
Accrued liabilities
|
19,976
|
|
|
31,361
|
|
||
Current portion of Senior Notes
|
115,000
|
|
|
120,000
|
|
||
Interest payable
|
8,794
|
|
|
11,645
|
|
||
Other current liabilities
|
2,116
|
|
|
1,133
|
|
||
Total current liabilities
|
222,962
|
|
|
246,036
|
|
||
Contingent consideration liability
|
1,066
|
|
|
1,038
|
|
||
Senior Notes
|
136,418
|
|
|
158,309
|
|
||
Convertible Notes
|
292,604
|
|
|
287,798
|
|
||
Other long-term liabilities
|
21,869
|
|
|
19,350
|
|
||
Total liabilities
|
674,919
|
|
|
712,531
|
|
||
Commitments and contingencies
|
|
|
|
||||
Shareholders’ equity:
|
|
|
|
||||
Common stock
|
6
|
|
|
6
|
|
||
Additional paid-in capital
|
405,445
|
|
|
402,934
|
|
||
Accumulated deficit
|
(196,901
|
)
|
|
(182,600
|
)
|
||
Accumulated other comprehensive loss
|
(5
|
)
|
|
(5
|
)
|
||
Total shareholders’ equity
|
208,545
|
|
|
220,335
|
|
||
Total liabilities and shareholders' equity
|
$
|
883,464
|
|
|
$
|
932,866
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
Revenues:
|
|
|
|
||||
Product sales, net
|
$
|
26,450
|
|
|
$
|
44,354
|
|
Commercialization agreement, net
|
30,856
|
|
|
83,800
|
|
||
Royalties and milestones
|
623
|
|
|
250
|
|
||
Total revenues
|
57,929
|
|
|
128,404
|
|
||
Costs and expenses:
|
|
|
|
||||
Cost of sales (excluding amortization of intangible assets)
|
2,575
|
|
|
12,044
|
|
||
Research and development expenses
|
1,793
|
|
|
1,528
|
|
||
Selling, general and administrative expenses
|
25,045
|
|
|
29,033
|
|
||
Amortization of intangible assets
|
25,444
|
|
|
25,444
|
|
||
Restructuring charges
|
—
|
|
|
9,017
|
|
||
Total costs and expenses
|
54,857
|
|
|
77,066
|
|
||
Income from operations
|
3,072
|
|
|
51,338
|
|
||
Other (expense) income:
|
|
|
|
||||
Interest income and other (expense) income, net
|
(609
|
)
|
|
229
|
|
||
Interest (expense)
|
(16,554
|
)
|
|
(18,068
|
)
|
||
Net (loss) income before income taxes
|
(14,091
|
)
|
|
33,499
|
|
||
Income taxes (expense) benefit
|
(210
|
)
|
|
325
|
|
||
Net (loss) income
|
$
|
(14,301
|
)
|
|
$
|
33,824
|
|
Basic net (loss) income per share
|
$
|
(0.22
|
)
|
|
$
|
0.53
|
|
Diluted net (loss) income per share
|
$
|
(0.22
|
)
|
|
$
|
0.48
|
|
Shares used in computing basic net (loss) income per share
|
64,239
|
|
|
63,503
|
|
||
Shares used in computing diluted net (loss) income per share
|
64,239
|
|
|
81,877
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
Net (loss) income
|
$
|
(14,301
|
)
|
|
$
|
33,824
|
|
Unrealized (loss) gain on available-for-sale securities, net of tax
|
—
|
|
|
2
|
|
||
Comprehensive (loss) income
|
$
|
(14,301
|
)
|
|
$
|
33,826
|
|
|
Common Stock
|
|
Additional
Paid-In
Capital
|
|
Accumulated
Earnings
(Deficit)
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Shareholders’
Equity
|
|||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||
Balances at December 31, 2017
|
63,400
|
|
|
$
|
6
|
|
|
$
|
389,015
|
|
|
$
|
(219,508
|
)
|
|
$
|
(5
|
)
|
|
$
|
169,508
|
|
Issuance of common stock upon exercise of options
|
120
|
|
|
—
|
|
|
636
|
|
|
—
|
|
|
—
|
|
|
636
|
|
|||||
Issuance of common stock in conjunction with vesting of restricted stock units
|
33
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
2,234
|
|
|
—
|
|
|
—
|
|
|
2,234
|
|
|||||
Shares withheld for payment of employee's withholding tax liability
|
—
|
|
|
—
|
|
|
(114
|
)
|
|
—
|
|
|
—
|
|
|
(114
|
)
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
33,824
|
|
|
—
|
|
|
33,824
|
|
|||||
Unrealized gain on available-for-sale securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|||||
Balances at March 31, 2018
|
63,553
|
|
|
$
|
6
|
|
|
$
|
391,771
|
|
|
$
|
(185,684
|
)
|
|
$
|
(3
|
)
|
|
$
|
206,090
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balances at December 31, 2018
|
64,185
|
|
|
$
|
6
|
|
|
$
|
402,934
|
|
|
$
|
(182,600
|
)
|
|
$
|
(5
|
)
|
|
$
|
220,335
|
|
Issuance of common stock upon exercise of options
|
14
|
|
|
—
|
|
|
25
|
|
|
—
|
|
|
—
|
|
|
25
|
|
|||||
Issuance of common stock in conjunction with vesting of restricted stock units
|
132
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
2,702
|
|
|
—
|
|
|
—
|
|
|
2,702
|
|
|||||
Shares withheld for payment of employee's withholding tax liability
|
—
|
|
|
—
|
|
|
(216
|
)
|
|
—
|
|
|
—
|
|
|
(216
|
)
|
|||||
Net (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
(14,301
|
)
|
|
—
|
|
|
(14,301
|
)
|
|||||
Balances at March 31, 2019
|
64,331
|
|
|
$
|
6
|
|
|
$
|
405,445
|
|
|
$
|
(196,901
|
)
|
|
$
|
(5
|
)
|
|
$
|
208,545
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
Operating Activities
|
|
|
|
||||
Net (loss) income
|
$
|
(14,301
|
)
|
|
$
|
33,824
|
|
Adjustments for non-cash items:
|
|
|
|
||||
Depreciation and amortization
|
25,990
|
|
|
26,918
|
|
||
Accretion of debt discount and debt issuance costs
|
6,164
|
|
|
5,418
|
|
||
Provision for inventory obsolescence
|
359
|
|
|
218
|
|
||
Gain on disposal of property and equipment
|
—
|
|
|
(134
|
)
|
||
Stock-based compensation
|
2,702
|
|
|
2,234
|
|
||
Change in fair value of contingent consideration
|
28
|
|
|
(201
|
)
|
||
Other
|
1,297
|
|
|
34
|
|
||
Changes in assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
(6,278
|
)
|
|
10,055
|
|
||
Inventories
|
(40
|
)
|
|
7,457
|
|
||
Prepaid and other assets
|
30,592
|
|
|
(34,497
|
)
|
||
Accounts payable and other accrued liabilities
|
(12,361
|
)
|
|
(33,515
|
)
|
||
Accrued rebates, returns and discounts
|
(4,105
|
)
|
|
(42,730
|
)
|
||
Interest payable
|
(2,852
|
)
|
|
(2,055
|
)
|
||
Income taxes payable
|
—
|
|
|
(1
|
)
|
||
Net cash provided by (used in) operating activities
|
27,195
|
|
|
(26,975
|
)
|
||
Investing Activities
|
|
|
|
||||
Purchases of property and equipment
|
(13
|
)
|
|
(1
|
)
|
||
Proceeds from disposal of property and equipment
|
—
|
|
|
145
|
|
||
Proceeds from sale of other assets
|
—
|
|
|
80
|
|
||
Maturities of marketable securities
|
—
|
|
|
1,200
|
|
||
Net cash provided by (used in) investing activities
|
(13
|
)
|
|
1,424
|
|
||
Financing Activities
|
|
|
|
||||
Payment of contingent consideration liability
|
—
|
|
|
(162
|
)
|
||
Repayment of Senior Notes
|
(25,000
|
)
|
|
—
|
|
||
Fees for modification of Senior Notes
|
(3,249
|
)
|
|
—
|
|
||
Proceeds from issuance of common stock
|
25
|
|
|
636
|
|
||
Shares withheld for payment of employee's withholding tax liability
|
(216
|
)
|
|
(114
|
)
|
||
Net cash provided by (used in) financing activities
|
(28,440
|
)
|
|
360
|
|
||
Net (decrease) in cash and cash equivalents
|
(1,258
|
)
|
|
(25,191
|
)
|
||
Cash and cash equivalents at beginning of year
|
110,949
|
|
|
126,884
|
|
||
Cash and cash equivalents at end of period
|
$
|
109,691
|
|
|
$
|
101,693
|
|
Supplemental Disclosure of Cash Flow Information
|
|
|
|
||||
Net cash paid for income taxes
|
$
|
—
|
|
|
$
|
1
|
|
Cash paid for interest
|
$
|
13,213
|
|
|
$
|
14,653
|
|
Capital expenditures incurred but not yet paid
|
$
|
130
|
|
|
$
|
119
|
|
•
|
Gralise
®
(gabapentin), a once daily product for the management of postherpetic neuralgia (PHN), that was launched in October 2011.
|
•
|
CAMBIA
®
(diclofenac potassium for oral solution), a non-steroidal anti-inflammatory drug for the acute treatment of migraine attacks, that was acquired by the Company in December 2013.
|
•
|
Zipsor
®
(diclofenac potassium liquid filled capsules), a non-steroidal anti-inflammatory drug for the treatment of mild to moderate acute pain, that was acquired by the Company in June 2012.
|
March 31, 2019
|
|
Amortized Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Fair Value
|
||||||||
Cash and cash equivalents
|
|
|
|
|
|
|
|
|
||||||||
Cash
|
|
$
|
94,311
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
94,311
|
|
Money market funds
|
|
41
|
|
|
—
|
|
|
—
|
|
|
41
|
|
||||
Commercial paper
|
|
14,594
|
|
|
—
|
|
|
(3
|
)
|
|
14,591
|
|
||||
U.S. Treasury Securities
|
|
748
|
|
|
—
|
|
|
—
|
|
|
748
|
|
||||
Total cash and cash equivalents
|
|
$
|
109,694
|
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
109,691
|
|
December 31, 2018
|
|
Amortized Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Fair Value
|
||||||||
Cash and cash equivalents
|
|
|
|
|
|
|
|
|
||||||||
Cash
|
|
$
|
95,660
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
95,660
|
|
Money market funds
|
|
11
|
|
|
—
|
|
|
—
|
|
|
11
|
|
||||
Agency bond
|
|
1,250
|
|
|
—
|
|
|
—
|
|
|
1,250
|
|
||||
Commercial paper
|
|
14,028
|
|
|
—
|
|
|
—
|
|
|
14,028
|
|
||||
Total cash and cash equivalents
|
|
$
|
110,949
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
110,949
|
|
•
|
Level 1: Quoted prices in active markets for identical assets or liabilities.
|
•
|
Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
|
•
|
Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
|
(in thousands)
|
Financial Statement
|
|
|
|
|
|
|
|
|
||||||||
March 31, 2019
|
Classification
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
Cash and cash equivalents
|
|
$
|
41
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
41
|
|
Commercial paper
|
Cash and cash equivalents
|
|
—
|
|
|
14,591
|
|
|
—
|
|
|
14,591
|
|
||||
U.S. Treasury Securities
|
Cash and cash equivalents
|
|
—
|
|
|
748
|
|
|
—
|
|
|
748
|
|
||||
Collegium warrants
|
Investments
|
|
—
|
|
|
7,155
|
|
|
—
|
|
|
7,155
|
|
||||
Total
|
|
|
$
|
41
|
|
|
$
|
22,494
|
|
|
$
|
—
|
|
|
$
|
22,535
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||
Contingent consideration—Zipsor
|
Contingent consideration liability
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
545
|
|
|
$
|
545
|
|
Contingent consideration—CAMBIA
|
Contingent consideration liability
|
|
—
|
|
|
—
|
|
|
521
|
|
|
521
|
|
||||
Total
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,066
|
|
|
$
|
1,066
|
|
(in thousands)
|
Financial Statement
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2018
|
Classification
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
Cash and cash equivalents
|
|
$
|
11
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11
|
|
Agency bond
|
Cash and cash equivalents
|
|
—
|
|
|
1,250
|
|
|
—
|
|
|
1,250
|
|
||||
Commercial paper
|
Cash and cash equivalents
|
|
—
|
|
|
14,028
|
|
|
—
|
|
|
14,028
|
|
||||
Collegium warrants
|
Investments
|
|
—
|
|
|
8,784
|
|
|
—
|
|
|
8,784
|
|
||||
Total
|
|
|
$
|
11
|
|
|
$
|
24,062
|
|
|
$
|
—
|
|
|
$
|
24,073
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||
Contingent consideration—Zipsor
|
Contingent consideration liability
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
531
|
|
|
$
|
531
|
|
Contingent consideration—CAMBIA
|
Contingent consideration liability
|
|
—
|
|
|
—
|
|
|
507
|
|
|
507
|
|
||||
Total
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,038
|
|
|
$
|
1,038
|
|
|
Three Months Ended March 31,
|
||||||
(in thousands)
|
2019
|
|
2018
|
||||
Fair value, beginning of the period
|
$
|
1,038
|
|
|
$
|
1,613
|
|
Changes in fair value recorded in interest expense
|
28
|
|
|
40
|
|
||
Changes in fair value recorded in selling, general and administrative expenses
|
—
|
|
|
(242
|
)
|
||
Royalties and milestone paid
|
—
|
|
|
(162
|
)
|
||
Total
|
$
|
1,066
|
|
|
$
|
1,249
|
|
|
|
Three Months Ended March 31,
|
||||||
(in thousands, except for per share amounts)
|
|
2019
|
|
2018
|
||||
Basic net income (loss) per share
|
|
|
|
|
||||
Net income (loss)
|
|
$
|
(14,301
|
)
|
|
$
|
33,824
|
|
Denominator
|
|
64,239
|
|
|
63,503
|
|
||
Basic net income (loss) per share
|
|
$
|
(0.22
|
)
|
|
$
|
0.53
|
|
|
|
|
|
|
||||
Diluted net income (loss) per share
|
|
|
|
|
||||
Numerator:
|
|
|
|
|
||||
Net income (loss)
|
|
$
|
(14,301
|
)
|
|
$
|
33,824
|
|
Add: Interest Expense on convertible debt, net of tax
|
|
—
|
|
|
5,187
|
|
||
Denominator:
|
|
|
|
|
||||
Denominator for basic net income (loss) per share
|
|
64,239
|
|
|
63,503
|
|
||
Add effect of diluted securities:
|
|
|
|
|
||||
Stock options and equivalents and convertible debt
|
|
—
|
|
|
18,374
|
|
||
Denominator for diluted net income (loss) per share
|
|
64,239
|
|
|
81,877
|
|
||
Diluted net income (loss) per share
|
|
$
|
(0.22
|
)
|
|
$
|
0.48
|
|
|
|
Three Months Ended March 31,
|
||||
(in thousands)
|
|
2019
|
|
2018
|
||
Convertible debt
|
|
17,931
|
|
|
—
|
|
Stock options and equivalents
|
|
6,103
|
|
|
4,248
|
|
Total potentially dilutive common shares
|
|
24,034
|
|
|
4,248
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Product sales, net
|
|
|
|
|
||||
Gralise
|
|
$
|
13,278
|
|
|
$
|
14,827
|
|
CAMBIA
|
|
8,808
|
|
|
6,416
|
|
||
Zipsor
|
|
4,231
|
|
|
4,746
|
|
||
Total neurology product sales, net
|
|
26,317
|
|
|
25,989
|
|
||
NUCYNTA products
|
|
62
|
|
|
18,145
|
|
||
Lazanda
|
|
71
|
|
|
220
|
|
||
Total product sales, net
|
|
26,450
|
|
|
44,354
|
|
||
Commercialization agreement:
|
|
|
|
|
||||
Commercialization rights and facilitation services, net
|
|
30,856
|
|
|
28,095
|
|
||
Revenue from transfer of inventory
|
|
—
|
|
|
55,705
|
|
||
Royalties and milestone revenue
|
|
623
|
|
|
250
|
|
||
Total revenues
|
|
$
|
57,929
|
|
|
$
|
128,404
|
|
|
Balance as of
|
|
|
|
|
|
Balance as of
|
||||||||
|
December 31, 2018
|
|
Additions
|
|
Deductions
|
|
March 31, 2019
|
||||||||
Contract assets:
|
|
|
|
|
|
|
|
|
|
|
|||||
Contract asset - Cambia Canada
|
$
|
—
|
|
|
$
|
300
|
|
|
$
|
—
|
|
|
$
|
300
|
|
Contract asset - Collegium
|
2,416
|
|
|
—
|
|
|
(199
|
)
|
|
2,217
|
|
||||
|
$
|
2,416
|
|
|
$
|
300
|
|
|
$
|
(199
|
)
|
|
$
|
2,517
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
Cost of sales
|
$
|
—
|
|
|
$
|
14
|
|
Research and development expense
|
273
|
|
|
53
|
|
||
Selling, general and administrative expense
|
2,429
|
|
|
1,909
|
|
||
Restructuring
|
—
|
|
|
258
|
|
||
Total
|
$
|
2,702
|
|
|
$
|
2,234
|
|
|
March 31,
2019 |
|
December 31,
2018 |
||||
|
|
||||||
Raw materials
|
$
|
1,554
|
|
|
$
|
1,376
|
|
Work-in-process
|
831
|
|
|
732
|
|
||
Finished goods
|
692
|
|
|
1,288
|
|
||
Total
|
$
|
3,077
|
|
|
$
|
3,396
|
|
|
March 31,
2019 |
|
December 31,
2018 |
||||
|
|
||||||
Receivables related to product sales, net
|
$
|
33,811
|
|
|
$
|
23,078
|
|
Receivables from Collegium
|
9,556
|
|
|
14,011
|
|
||
Other
|
121
|
|
|
122
|
|
||
Total accounts receivable, net
|
$
|
43,488
|
|
|
$
|
37,211
|
|
|
March 31,
2019 |
|
December 31,
2018 |
||||
|
|
||||||
Accrued compensation
|
$
|
2,916
|
|
|
$
|
5,475
|
|
Accrued royalties
|
2,192
|
|
|
2,773
|
|
||
Accrued restructuring and one-time termination costs
|
820
|
|
|
1,578
|
|
||
Other accrued liabilities
|
14,048
|
|
|
21,535
|
|
||
Total accrued liabilities
|
$
|
19,976
|
|
|
$
|
31,361
|
|
2019 (remainder)
|
$
|
95,000
|
|
2020
|
80,000
|
|
|
2021
|
82,500
|
|
|
Total
|
$
|
257,500
|
|
|
March 31,
2019 |
|
December 31,
2018 |
||||
|
|
||||||
Principal amount of the Senior Notes
|
$
|
257,500
|
|
|
$
|
282,500
|
|
Unamortized debt discount balance
|
(2,077
|
)
|
|
(2,541
|
)
|
||
Unamortized debt issuance costs
|
(4,005
|
)
|
|
(1,650
|
)
|
||
Total Senior Notes
|
$
|
251,418
|
|
|
$
|
278,309
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
Contractual interest expense
|
$
|
8,206
|
|
|
$
|
10,441
|
|
Amortization of debt discount and debt issuance costs
|
1,357
|
|
|
1,008
|
|
||
Total interest expense Senior Notes
|
$
|
9,563
|
|
|
$
|
11,449
|
|
|
March 31,
2019 |
|
December 31,
2018 |
||||
|
|
||||||
Principal amount of the Convertible Notes
|
$
|
345,000
|
|
|
$
|
345,000
|
|
Unamortized discount of the liability component
|
(49,967
|
)
|
|
(54,521
|
)
|
||
Unamortized debt issuance costs
|
(2,429
|
)
|
|
(2,681
|
)
|
||
Total Convertible Notes
|
$
|
292,604
|
|
|
$
|
287,798
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
Stated coupon interest
|
$
|
2,156
|
|
|
$
|
2,156
|
|
Amortization of debt discount and debt issuance costs
|
4,807
|
|
|
4,410
|
|
||
Total interest expense Convertible Notes
|
$
|
6,963
|
|
|
$
|
6,566
|
|
|
|
|
Three months ended
|
||
(in thousands)
|
Financial Statement Classification
|
|
March 31, 2019
|
||
Operating lease cost
|
Selling, general and administrative expenses
|
|
$
|
187
|
|
Operating lease cost
|
Interest income and other (expense) income, net
|
|
148
|
|
|
Total lease cost
|
|
|
$
|
335
|
|
Sublease Income
|
Interest and other (expense) income, net
|
|
$
|
362
|
|
|
|
Three months ended
|
||
(in thousands)
|
|
March 31, 2019
|
||
Cash paid for amounts included in measurement of liabilities:
|
|
|
||
Operating cash flows from operating leases
|
|
$
|
582
|
|
(in thousands)
|
Financial Statement Classification
|
|
March 31, 2019
|
||
Assets
|
|
|
|
||
Operating lease right-of-use assets
|
Property and equipment, net
|
|
$
|
3,446
|
|
Liabilities
|
|
|
|
||
Current operating lease liabilities
|
Other current liabilities
|
|
$
|
2,118
|
|
Noncurrent operating lease liabilities
|
Other long term liabilities
|
|
6,357
|
|
|
Total lease liabilities
|
|
|
$
|
8,475
|
|
(in thousands)
|
Operating Leases
|
||
2019 (remainder)
|
$
|
1,878
|
|
2020
|
2,443
|
|
|
2021
|
2,326
|
|
|
2022
|
2,188
|
|
|
2023
|
632
|
|
|
Thereafter
|
—
|
|
|
Total lease payments
|
$
|
9,467
|
|
Less: Interest
|
992
|
|
|
Present value of lease liabilities
|
$
|
8,475
|
|
(in thousands)
|
Lease Payments
|
||
2019 (remainder)
|
$
|
2,624
|
|
2020
|
2,526
|
|
|
2021
|
2,322
|
|
|
2022
|
2,188
|
|
|
2023
|
632
|
|
|
Thereafter
|
—
|
|
|
Total
|
$
|
10,292
|
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||||
|
|
Remaining
|
|
Gross
|
|
|
|
|
|
Gross
|
|
|
|
|
||||||||||||
|
|
Useful Life
|
|
Carrying
|
|
Accumulated
|
|
Net Book
|
|
Carrying
|
|
Accumulated
|
|
Net Book
|
||||||||||||
Product rights
|
|
(In years)
|
|
Amount
|
|
Amortization
|
|
Value
|
|
Amount
|
|
Amortization
|
|
Value
|
||||||||||||
NUCYNTA
|
|
6.8
|
|
$
|
1,019,978
|
|
|
$
|
(384,466
|
)
|
|
$
|
635,512
|
|
|
$
|
1,019,978
|
|
|
$
|
(360,891
|
)
|
|
$
|
659,087
|
|
CAMBIA
|
|
4.8
|
|
51,360
|
|
|
(27,175
|
)
|
|
24,185
|
|
|
51,360
|
|
|
(25,891
|
)
|
|
25,469
|
|
||||||
Zipsor
|
|
3.0
|
|
27,250
|
|
|
(20,292
|
)
|
|
6,958
|
|
|
27,250
|
|
|
(19,707
|
)
|
|
7,543
|
|
||||||
Total
|
|
|
|
$
|
1,098,588
|
|
|
$
|
(431,933
|
)
|
|
$
|
666,655
|
|
|
$
|
1,098,588
|
|
|
$
|
(406,489
|
)
|
|
$
|
692,099
|
|
|
|
Estimated
|
||
|
|
Amortization
|
||
Year Ending December 31,
|
|
Expense
|
||
2019 (remainder)
|
|
$
|
76,330
|
|
2020
|
|
101,774
|
|
|
2021
|
|
101,774
|
|
|
2022
|
|
99,969
|
|
|
Thereafter
|
|
286,808
|
|
|
Total
|
|
$
|
666,655
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
Employee compensation costs
|
$
|
—
|
|
|
$
|
8,779
|
|
Fixed Asset disposals and accelerated depreciation of leasehold improvements
|
—
|
|
|
—
|
|
||
Other exit costs
|
—
|
|
|
238
|
|
||
Total restructuring costs
|
$
|
—
|
|
|
$
|
9,017
|
|
|
Employee compensation costs
|
||
Balance at December 31, 2018
|
$
|
1,578
|
|
Net accruals
|
—
|
|
|
Non-cash adjustments
|
—
|
|
|
Cash paid
|
(758
|
)
|
|
Balance at March 31, 2019
|
$
|
820
|
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
the commercial success and market acceptance of our products and product candidate, long-acting cosyntropin;
|
•
|
the success of Collegium in commercializing NUCYNTA
®
ER and NUCYNTA
®
;
|
•
|
the reversal or any successful appeal of the court's favorable ruling in our patent infringement litigation against the filers of Abbreviated New Drug Applications (each, an ANDA) to market generic versions of NUCYNTA ER and NUCYNTA in the United States (U.S.);
|
•
|
any additional patent infringement or other litigation, investigation or proceeding that may be instituted related to us or any of our products, product candidates or products we may acquire;
|
•
|
our ability to generate sufficient cash flow from our business to make payments on our indebtedness, our ability to restructure or refinance our indebtedness and our compliance with the terms and conditions of the agreements governing our indebtedness;
|
•
|
our and our collaborative partners’ compliance or non-compliance with legal and regulatory requirements related to the development or promotion of pharmaceutical products in the U.S.;
|
•
|
our plans to acquire, in-license or co-promote other products;
|
•
|
the timing and the results of our and our collaborative partners' research and development efforts including clinical studies relating to our and our collaborative partners' product candidates, including long-acting cosyntropin;
|
•
|
approval of regulatory filings, including filings for long-acting cosyntropin;
|
•
|
our ability to raise additional capital, if necessary;
|
•
|
our ability to successfully develop and execute our sales and marketing strategies;
|
•
|
variations in revenues obtained from commercialization and collaborative agreements, including contingent milestone payments, royalties, license fees and other contract revenues, including non-recurring revenues, and the accounting treatment with respect thereto;
|
•
|
our collaborative partners’ compliance or non-compliance with obligations under our collaboration agreements;
|
•
|
the outcome of both our opioid-related investigations, our opioid-related litigation brought by state and local governmental entities and private parties, and our insurance litigation, and the costs and expenses associated therewith;
|
•
|
the regulatory strategy for long-acting cosyntropin and both our and our collaborative partner’s ability to successfully develop and execute such strategy; and
|
•
|
our ability to attract and retain key executive leadership following our restructuring and office relocation.
|
•
|
Gralise
®
(gabapentin), a once daily product for the management of postherpetic neuralgia (PHN), that we launched in October 2011.
|
•
|
CAMBIA
®
(diclofenac potassium for oral solution), a non-steroidal anti-inflammatory drug for the acute treatment of migraine attacks, that we acquired in December 2013.
|
•
|
Zipsor
®
(diclofenac potassium liquid filled capsules), a non-steroidal anti-inflammatory drug for the treatment of mild to moderate acute pain, that we acquired in June 2012.
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Product sales, net
|
|
|
|
|
||||
Gralise
|
|
$
|
13,278
|
|
|
$
|
14,827
|
|
CAMBIA
|
|
8,808
|
|
|
6,416
|
|
||
Zipsor
|
|
4,231
|
|
|
4,746
|
|
||
Total neurology product sales, net
|
|
26,317
|
|
|
25,989
|
|
||
NUCYNTA products
(1)
|
|
62
|
|
|
18,145
|
|
||
Lazanda
(2)
|
|
71
|
|
|
220
|
|
||
Total product sales, net
|
|
26,450
|
|
|
44,354
|
|
||
Commercialization agreement:
|
|
|
|
|
|
|
||
Commercialization rights and facilitation services, net
|
|
30,856
|
|
|
28,095
|
|
||
Revenue from transfer of inventory
|
|
—
|
|
|
55,705
|
|
||
Royalties and Milestone Revenue
|
|
623
|
|
|
250
|
|
||
Total revenues
|
|
$
|
57,929
|
|
|
$
|
128,404
|
|
(1)
|
NUCYNTA product sales for the
three
months ended March 31, 2018 reflect our sales of NUCYNTA between January 1 and January 8, 2018. During the first quarter of 2018, in connection with the Collegium transaction, we recognized revenue of
$12.5
million related to the release of NUCYNTA sales reserves which were primarily recorded in the fourth quarter of 2017, as financial responsibility for those reserves transferred to Collegium upon closing of the Commercialization Agreement. During the three months ended
March 31, 2019
we recognized an insignificant amount of sales reserve estimate adjustments related to sales recognized for NUCYNTA and Lazanda in prior periods.
|
(2)
|
We divested Lazanda in November 2017. Product sales for the
three
months ended
March 31, 2019
and 2018 relate to sales reserve estimate adjustments.
|
|
|
Three months ended March 31,
|
||||||
|
|
2019
|
|
2018
|
||||
License Revenue
|
|
$
|
32,098
|
|
|
$
|
28,095
|
|
Contract Liability Amortization
(1)
|
|
688
|
|
|
—
|
|
||
Contract Asset Amortization
|
|
(887
|
)
|
|
—
|
|
||
Third-party Royalty, net
|
|
(1,043
|
)
|
|
—
|
|
||
Inventory Transfer
|
|
—
|
|
|
55,705
|
|
||
Total Commercialization Revenue
|
|
$
|
30,856
|
|
|
$
|
83,800
|
|
|
|
Three Months Ended March 31,
|
||||||
(in thousands)
|
|
2019
|
|
2018
|
||||
Cost of Sales
|
|
$
|
2,575
|
|
|
$
|
12,044
|
|
Dollar change from prior year
|
|
(9,469
|
)
|
|
(5,730
|
)
|
||
Percentage change from prior year
|
|
(78.6
|
)%
|
|
(32.3
|
)%
|
|
|
Three Months Ended March 31,
|
||||||
(in thousands)
|
|
2019
|
|
2018
|
||||
Research and development expenses
|
|
$
|
1,793
|
|
|
$
|
1,528
|
|
Dollar change from prior year
|
|
265
|
|
|
(3,556
|
)
|
||
Percentage change from prior year
|
|
17.3
|
%
|
|
(69.9
|
)%
|
|
|
Three Months Ended March 31,
|
||||||
(in thousands)
|
|
2019
|
|
2018
|
||||
Selling, general and administrative expenses
|
|
$
|
25,045
|
|
|
$
|
29,033
|
|
Dollar change from prior year
|
|
(3,988
|
)
|
|
(19,486
|
)
|
||
Percentage change from prior year
|
|
(13.7
|
)%
|
|
(40.2
|
)%
|
|
|
Three Months Ended March 31,
|
||||||
(in thousands)
|
|
2019
|
|
2018
|
||||
Amortization of intangible assets - NUCYNTA
|
|
$
|
23,575
|
|
|
$
|
23,575
|
|
Amortization of intangible assets - CAMBIA
|
|
1,284
|
|
|
1,284
|
|
||
Amortization of intangible assets - Zipsor
|
|
585
|
|
|
585
|
|
||
Total
|
|
$
|
25,444
|
|
|
$
|
25,444
|
|
|
|
Three Months Ended March 31,
|
||||||
(in thousands)
|
|
2019
|
|
2018
|
||||
Employee compensation costs
|
|
$
|
—
|
|
|
$
|
8,779
|
|
Fixed Asset disposals and accelerated depreciation of leasehold improvements
|
|
—
|
|
|
—
|
|
||
Other exit costs
|
|
—
|
|
|
238
|
|
||
Total restructuring costs
|
|
$
|
—
|
|
|
$
|
9,017
|
|
|
|
Three Months Ended March 31,
|
||||||
(in thousands)
|
|
2019
|
|
2018
|
||||
Interest and other income
|
|
$
|
1,020
|
|
|
$
|
229
|
|
Change in fair value of Collegium warrants
|
|
(1,629
|
)
|
|
—
|
|
||
Interest expense
|
|
(16,554
|
)
|
|
(18,068
|
)
|
||
Total other income (expense)
|
|
$
|
(17,163
|
)
|
|
$
|
(17,839
|
)
|
|
|
Three Months Ended March 31,
|
||||||
(in thousands)
|
|
2019
|
|
2018
|
||||
Interest payable on Senior Notes
|
|
$
|
8,206
|
|
|
$
|
10,441
|
|
Interest payable on Convertible Notes
|
|
2,156
|
|
|
2,156
|
|
||
Amortization of debt discounts and issuance costs relating to Senior Notes and Convertible Notes
|
|
6,164
|
|
|
5,418
|
|
||
Changes in fair value of contingent consideration
|
|
28
|
|
|
40
|
|
||
Other
|
|
—
|
|
|
13
|
|
||
Total interest expense
|
|
$
|
16,554
|
|
|
$
|
18,068
|
|
|
|
March 31,
|
|
December 31,
|
||||
(in thousands)
|
|
2019
|
|
2018
|
||||
Cash, cash equivalents and short-term investments
|
|
$
|
109,691
|
|
|
$
|
110,949
|
|
|
|
Three Months Ended March 31,
|
||||||
(in thousands)
|
|
2019
|
|
2018
|
||||
Cash (used in) provided by operating activities
|
|
$
|
27,195
|
|
|
$
|
(26,975
|
)
|
Cash (used in) provided by investing activities
|
|
(13
|
)
|
|
1,424
|
|
||
Cash (used in) provided by financing activities
|
|
(28,440
|
)
|
|
360
|
|
||
Net (decrease) increase in cash and cash equivalents
|
|
$
|
(1,258
|
)
|
|
$
|
(25,191
|
)
|
•
|
develop and execute its sales and marketing strategies for NUCYNTA and NUCYNTA ER;
|
•
|
achieve, maintain and grow market acceptance of, and demand for, NUCYNTA and NUCYNTA ER;
|
•
|
obtain and maintain adequate coverage, reimbursement and pricing from managed care, government and other third- party payers;
|
•
|
maintain and manage the necessary sales, marketing, manufacturing, managed markets, and other capabilities and infrastructure that are required to successfully integrate and commercialize NUCYNTA and NUCYNTA ER;
|
•
|
obtain adequate supply of NUCYNTA and NUCYNTA ER; and
|
•
|
comply with applicable legal and regulatory requirements.
|
•
|
Collegium may prioritize the commercialization of their other products, including Xtampza, over NUCYNTA and NUCYNTA ER;
|
•
|
Collegium may pursue higher-priority programs, or change the focus of its marketing programs;
|
•
|
Collegium may acquire or develop alternative products;
|
•
|
Collegium may in the future choose to devote fewer resources to NUCYNTA and NUCYNTA ER;
|
•
|
changes in laws and regulations applicable to, and scrutiny of, the pharmaceutical industry, including the opioid market;
|
•
|
market acceptance of NUCYNTA and NUCYNTA ER may fail to increase or may decrease;
|
•
|
the outcome of the appeal of the court’s ruling in our litigation against the ANDA filers seeking to prevent such ANDA filers from marketing a generic version of NUCYNTA and NUCYNTA ER in the U.S.;
|
•
|
Collegium may experience financial difficulties;
|
•
|
Collegium may fail to comply with its obligations under our commercialization and related agreements; or
|
•
|
Collegium’s involvement in governmental investigations and inquires or lawsuits and the disposition of such proceedings.
|
•
|
develop and execute our sales and marketing strategies for our products;
|
•
|
achieve, maintain and grow market acceptance of, and demand for, our products;
|
•
|
obtain and maintain adequate coverage, reimbursement and pricing from managed care, government and other third party payers;
|
•
|
maintain, manage or scale the necessary sales, marketing, manufacturing, managed markets, and other capabilities and infrastructure that are required to successfully integrate and commercialize our products;
|
•
|
obtain adequate supply of our products;
|
•
|
maintain and extend intellectual property protection for our products; and
|
•
|
comply with applicable legal and regulatory requirements.
|
•
|
any parallel development by a commercialization or collaborative partner of competitive technologies or products;
|
•
|
arrangements with commercialization or collaborative partners that limit or preclude us from developing products or technologies;
|
•
|
premature termination of a commercialization or collaboration agreement or the inability to renegotiate existing agreements on favorable terms; or
|
•
|
failure by a commercialization or collaborative partner to devote sufficient resources to the development and commercial sales of products using our current and potential future products and technologies.
|
•
|
government health administration authorities;
|
•
|
private health insurers;
|
•
|
health maintenance organizations;
|
•
|
managed care organizations;
|
•
|
pharmacy benefit management companies; and
|
•
|
other healthcare-related organizations.
|
•
|
negative or inconclusive results;
|
•
|
patient enrollment rates;
|
•
|
patient noncompliance with the protocol;
|
•
|
adverse medical events or side effects among patients during the clinical trials;
|
•
|
any findings resulting from FDA inspections of clinical operations;
|
•
|
failure to meet FDA preferred or recommended clinical trial design, end points or statistical power;
|
•
|
failure to comply with good clinical practices;
|
•
|
failure of third party clinical trial vendors to comply with applicable regulatory laws and regulations;
|
•
|
compliance with applicable laws and regulations;
|
•
|
inability of third party clinical trial vendors to satisfactorily perform their contractual obligations, comply with applicable laws and regulations or meet deadlines;
|
•
|
delays or failures in obtaining clinical materials or manufacturing sufficient quantities of the product candidate for use in clinical trials;
|
•
|
delays or failures in recruiting qualified patients to participate in clinical trials; and
|
•
|
actual or perceived lack of efficacy or safety of the product candidate.
|
•
|
market acceptance;
|
•
|
a cost-effective commercial scale production; and
|
•
|
reimbursement under private or governmental health plans.
|
•
|
adversely affect our business, financial condition and results of operations;
|
•
|
result in reputational harm and reduced market acceptance and demand for our products;
|
•
|
harm our and our commercial partner’s ability to market our products;
|
•
|
cause us to incur significant liabilities, costs and expenses; and
|
•
|
cause our senior management to be distracted from execution of our business strategy.
|
•
|
we may be unable to maintain product liability insurance on acceptable terms;
|
•
|
we may be unable to obtain product liability insurance for future trials;
|
•
|
we may be unable to obtain product liability insurance for future products; or
|
•
|
our insurance may not provide adequate protection against potential liabilities (including pending and future claims relating to opioid litigation), or may provide no protection at all.
|
•
|
make it more difficult for us to meet our payment and other obligations under the Convertible Notes, the Senior Secured Notes or our other indebtedness;
|
•
|
result in other events of default under our Convertible Notes, Senior Secured Notes or our other indebtedness, which events of default could result in all of our debt becoming immediately due and payable;
|
•
|
make us more vulnerable to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation;
|
•
|
limit our ability to borrow additional amounts for working capital and other general corporate purposes, including funding possible acquisitions of, or investments in, new and complementary businesses, products and technologies which is a key element of our corporate strategy;
|
•
|
subject us to the risk of increased sensitivity to interest rate increases on our indebtedness with variable interest rates, including the Senior Notes;
|
•
|
require the dedication of a substantial portion of our cash flow from operations to service our indebtedness, thereby reducing the amount of our cash flow available for other purposes, including working capital, clinical
|
•
|
prevent us from raising funds necessary to repurchase the Convertible Notes in the event we are required to do so following a “fundamental change,” as specified in the indenture governing the Convertible Notes, to repurchase the Senior Notes in the event we are required to do so following a “major transaction” or as required in the event that the principal amount outstanding under the Convertible Notes as of March 31, 2021 is greater than $100.0 million, as specified in the Note Purchase Agreement or to settle conversions of the Convertible Notes in cash;
|
•
|
result in dilution to our existing shareholders as a result of the conversion of the Convertible Notes into shares of common stock;
|
•
|
limit our flexibility in planning for, or reacting to, changes in our business and our industry; and
|
•
|
put us at a disadvantage compared to our competitors who have less debt.
|
•
|
minimize the disruption and distraction of our management and other employees, including our sales force, in connection with the integration of any acquired business, product or technology;
|
•
|
maintain and increase sales of our existing products;
|
•
|
establish or manage the transition of the manufacture and supply of any acquired product, including the necessary active pharmaceutical ingredients, excipients and components;
|
•
|
identify and add the necessary sales, marketing, manufacturing, regulatory and other related personnel, capabilities and infrastructure that are required to successfully integrate any acquired business, product or technology;
|
•
|
manage the transition and migration of all commercial, financial, legal, clinical, regulatory and other pertinent information relating to any acquired business, product or technology;
|
•
|
comply with legal, regulatory and contractual requirements applicable to any acquired business, product or technology;
|
•
|
obtain and maintain adequate coverage, reimbursement and pricing from managed care, government and other third- party payers with respect to any acquired product; and
|
•
|
maintain and extend intellectual property protection for any acquired product or technology.
|
•
|
the degree of commercial success and market acceptance of NUCYNTA and NUCYNTA ER achieved by Collegium;
|
•
|
the degree of commercial success and market acceptance of Gralise, CAMBIA and Zipsor achieved;
|
•
|
the current and future market conditions for short-acting and long-acting opioids;
|
•
|
filings and other regulatory or governmental actions, investigations or proceedings related to our products and product candidate and those of our commercialization and collaborative partners;
|
•
|
the outcome of the appeal of the court’s favorable ruling in our patent infringement litigation against the filers of ANDAs for NUCYNTA and NUCYNTA ER;
|
•
|
the regulatory strategy for long-acting cosyntropin and our and our collaborative partner’s ability to successfully develop and execute such strategy;
|
•
|
our ability to successfully commercialize long-acting cosyntropin if regulatory approval is obtained;
|
•
|
developments concerning proprietary rights, including patents, infringement allegations, inter party review proceedings and litigation matters;
|
•
|
legal and regulatory developments in the U.S.;
|
•
|
actions taken by industry stakeholders affecting the market for our products;
|
•
|
our ability to generate sufficient cash flow from our business to make payments on our indebtedness;
|
•
|
our and our commercialization and collaborative partners’ compliance or non-compliance with legal and regulatory requirements and with obligations under our collaborative agreements;
|
•
|
our ability to successfully develop and execute our sales and marketing strategies;
|
•
|
our plans to acquire, in-license or co-promote other products, compounds or acquire or combine with other companies, and our degree of success in realizing the intended advantages of, and mitigating any risks associated with, any such transaction;
|
•
|
adverse events related to our products, or product candidates, including recalls;
|
•
|
interruptions of manufacturing or supply, or other manufacture or supply difficulties;
|
•
|
variations in revenues obtained from commercialization and collaborative agreements, including contingent milestone payments, royalties, license fees and other contract revenues, including non-recurring revenues, and the accounting treatment with respect thereto;
|
•
|
adverse events or circumstances related to our peer companies or our industry or the markets for our products;
|
•
|
adoption of new technologies by us or our competitors;
|
•
|
the outcome of our opioid-related investigations and litigation;
|
•
|
the outcome and impact of a proxy contest initiated by an activist shareholder;
|
•
|
our compliance with the terms and conditions of the agreements governing our indebtedness;
|
•
|
decisions by collaborative partners to proceed or not to proceed with subsequent phases of a collaboration or program;
|
•
|
our ability to generate additional revenues from our intellectual property rights;
|
•
|
sales of large blocks of our common stock or the dilutive effect of our Convertible Notes; and
|
•
|
variations in our operating results, earnings per share, cash flows from operating activities, deferred revenue, and other financial metrics and non-financial metrics, and how those results are measured, presented and compare to analyst expectations.
|
•
|
responding to proxy contests and other actions by activist stockholders can be costly and time-consuming, disrupting our operations and diverting the attention of management and our employees;
|
•
|
perceived uncertainties as to our future direction may result in the loss of potential business opportunities and may make it more difficult to attract and retain qualified personnel, business partners, customers and others important to our success, any of which could negatively affect our business and our results of operations and financial condition; and
|
•
|
if nominees advanced by activist shareholders are elected or appointed to our Board of Directors with a specific agenda, it may adversely affect our ability to effectively and timely implement our strategic plans or to realize long-term value from our assets, and this could in turn have an adverse effect on our business and on our results of operations and financial condition.
|
10.1
|
|
|
10.2
|
|
|
31.1
|
|
|
31.2
|
|
|
32.1
|
|
|
32.2
|
|
|
101
|
|
Interactive Data Files pursuant to Rule 405 of Regulation S-T
|
Date: May 9, 2019
|
ASSERTIO THERAPEUTICS, INC.
|
|
|
|
/s/ Arthur J. Higgins
|
|
Arthur J. Higgins
|
|
President and Chief Executive Officer
|
|
|
|
/s/ Daniel A. Peisert
|
|
Daniel A. Peisert
|
|
Senior Vice President and Chief Financial Officer
|
Title/Level
|
Bonus Target
|
Weighting of Corporate Goals
|
Weighting of Personal Goals
|
President and Chief Executive Officer
|
100%
|
70%
|
30%
|
Chief Financial Officer
|
50%
|
70%
|
30%
|
General Counsel
|
50%
|
70%
|
30%
|
Chief Medical Officer
|
50%
|
70%
|
30%
|
Chief Commercial Officer
|
50%
|
70%
|
30%
|
Sr Vice Presidents (SVP)
|
40%
|
70%
|
30%
|
Vice Presidents (VP)
|
30%-35%
|
60%
|
40%
|
Associate Vice Presidents (AVP)
|
28%
|
60%
|
40%
|
Sr Directors / Directors
|
25%
|
60%
|
40%
|
Associate Directors / Expert, Principal Individual Contributors
|
20%
|
55%
|
45%
|
Sr Managers / Managers / Sr Technical Individual Contributors
|
15%
|
50%
|
50%
|
Supervisors
|
10%
|
40%
|
60%
|
Technical & Sr Individual Contributors
|
10%
|
30%
|
70%
|
All Other Individual Contributors
|
5%
|
30%
|
70%
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Assertio Therapeutics, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: May 9, 2019
|
By:
|
/s/ Arthur J. Higgins
|
|
|
Arthur J. Higgins
|
|
|
President and Chief Executive Officer
(Principal Executive Officer)
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Assertio Therapeutics, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: May 9, 2019
|
By:
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/s/ Daniel A. Peisert
|
|
|
Daniel A. Peisert
|
|
|
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: May 9, 2019
|
|
/s/ Arthur J. Higgins
|
|
|
Arthur J. Higgins
|
|
|
President and Chief Executive Officer
(Principal Executive Officer)
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: May 9, 2019
|
|
/s/ Daniel A. Peisert
|
|
|
Daniel A. Peisert
|
|
|
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
|