ANI PHARMACEUTICALS INC

ANI Pharmaceuticals is a diversified bio-pharmaceutical company that develops, manufactures, and commercializes therapeutics through its Rare Disease, Generics, and Brands businesses. The Company owns and operates three pharmaceutical manufacturing facilities, including two facilities in Baudette, Minnesota and one in East Windsor, New Jersey, which collectively are capable of producing oral solid dose products, as well as semi-solids, liquids and topicals, controlled substances, and potent products that must be manufactured in a fully-contained environment. The Company ceased operations at another manufacturing facility in Oakville, Ontario as of March 31, 2023. The Company's mission is "Serving Patients, Improving Lives."

The Company's primary competitors for its Generics portfolio include Amneal Pharmaceuticals, Inc., Apotex Inc., Aurobindo Pharma, Camber Pharmaceuticals Inc., Hikma Pharmaceuticals plc, Lupin Pharmaceuticals, Inc., Rising Pharmaceuticals, Inc., Strides Pharma Inc., Sun Pharmaceutical Industries Ltd., Teva Pharmaceuticals USA, Inc., Viatris Inc., and Zydus Pharmaceuticals USA. The principal competitor for Cortrophin Gel is Acthar Gel which is marketed by Keenova Therapeutics plc. The principal competitors for ILUVIEN include Eylea (aflibercept) 4 mg and Eylea HD (aflibercept) 8 mg, marketed by Regeneron in the U.S. and by Bayer in the EEA; Vabysmo (faricimab-svoa), marketed by Genentech; Avastin (bevacizumab), Lucentis (ranibizumab injection), marketed by Genentech (Roche) in the U.S. and Novartis in the rest of the world; Ozurdex (dexamethasone intravitreal implant), marketed by Allergan, an AbbVie company; PAVBLU (aflibercept-ayyh) marketed by Amgen Inc.; and TRIESENCE (triamcinolone acetonide injectable suspension) marketed by Harrow Eye, LLC. For NIU-PS, competitors include Ozurdex, Xipere, Retisert, Humira, and TRIESENCE.

The Company generates revenue through sales of generic, rare disease, and brands portfolio pharmaceutical products, royalties, and other pharmaceutical services. Revenue is recognized when obligations under the terms of contracts with customers are satisfied, which generally occurs when control of the products sold is transferred to the customer. The Company's gross product revenue is subject to a variety of deductions, which are estimated and recorded in the same period that the revenue is recognized, and primarily represent chargebacks, rebates, prompt payment discounts, Medicaid and other government pricing programs, price protection and shelf stock adjustments, sales returns, and other potential adjustments.

The Rare Disease and Brands segment consists of Rare Disease products including Cortrophin Gel, ILUVIEN, and YUTIQ, and Brands products including Atacand, Atacand HCT, Arimidex, Casodex, Inderal LA, Inderal XL, InnoPran XL, Inzirqo, Lithobid, Oxistat, Vancocin, and Veregen. Cortrophin Gel is an adrenocorticotropic hormone, also known as purified corticotropin, approved for the treatment of certain chronic autoimmune disorders, including acute exacerbations of multiple sclerosis and rheumatoid arthritis, in addition to excess urinary protein due to nephrotic syndrome. On February 28, 2025, the FDA approved a prefilled syringe format for Cortrophin Gel, which became available in 40 USP units/0.5 mL and 80 USP units/mL single-dose options. ILUVIEN is a fluocinolone acetonide intravitreal implant approved for the treatment of diabetic macular edema and, as of March 2025, for the treatment of chronic non-infectious uveitis affecting the posterior segment of the eye. YUTIQ is a fluocinolone acetonide intravitreal implant available in the U.S. for the treatment of NIU-PS. Net revenues for Rare Disease pharmaceutical products were $422.6 million ¹ during the year ended December 31, 2025, an increase of $193.0 million ² from $229.6 million ³ for the same period in 2024. Net revenues for Brands portfolio of pharmaceutical products were $61.3 million ⁴ during the year ended December 31, 2025, a decrease of $3.4 million ⁵ compared to $64.7 million ⁶ for the same period in 2024.

The Generics and Other segment includes generic pharmaceutical products and royalties and other pharmaceutical services. As of December 31, 2025, the Generics portfolio included more than 120 products ⁷ with a wide variety of indications. Net revenues for Generic pharmaceutical products were $384.1 million ⁸ during the year ended December 31, 2025, an increase of $83.1 million ⁹ over the prior year. Net revenues from royalties and other pharmaceuticals were $15.3 million ¹⁰ during the year ended December 31, 2025, a decrease of $3.7 million ¹¹ compared to $19.0 million ¹² for the same period in 2024. The Company launched a total of 13 ¹³ new products in 2025.

On September 16, 2024, the Company acquired Alimera Sciences, Inc., adding ILUVIEN and YUTIQ to its portfolio. In connection with the acquisition, the Company added two new products, ILUVIEN and YUTIQ. During March 2025, the FDA approved an expanded label for ILUVIEN to include an indication for the treatment of chronic NIU-PS. On August 13, 2024, the Company entered into a credit agreement providing for a senior secured delayed-draw term loan facility in an aggregate principal amount of $325.0 million ¹⁴ and a senior secured revolving credit facility in an aggregate commitment amount of $75.0 million ¹⁵. On August 13, 2024, the Company completed an offering of $316.25 million ¹⁶ aggregate principal amount of Convertible Senior Notes due 2029. On March 17, 2025, the Company exercised the Buy-Out Option and paid SWK $17.3 million ¹⁷ with cash on hand. During the third quarter of 2025, all of the PIPE Shares were converted into common shares. On August 14, 2025, the PIPE Investor converted 5,000 ¹⁸ PIPE Shares into 120,580 ¹⁹ shares of common stock. On September 26, 2025, the Company elected mandatory conversion of the remaining 20,000 ²⁰ outstanding PIPE Shares into 482,320 ²¹ shares of common stock.

Net revenues for the year ended December 31, 2025 were $883.4 million ²² compared to $614.4 million ²³ for the same period in 2024, an increase of $269.0 million ²⁴, or 43.8% ²⁵. Net income was $78.3 million ²⁶ for the year ended December 31, 2025, compared to a net loss of $18.5 million ²⁷ for the same period in 2024. Diluted EPS was $3.32 ²⁸ for the year ended December 31, 2025, compared to a diluted loss per share of $1.04 ²⁹ for the same period in 2024. Operating income was $111.1 million ³⁰ for the year ended December 31, 2025, compared to $0.6 million ³¹ for the same period in 2024.

The Company expects that its robust pipeline will continue to yield approximately 10 to 15 ³² new product launches per year.

The Company plans to continue to expand its Rare Disease business through a combination of organic growth and acquisitions. During 2026, the Company plans to build a dedicated sales organization focused on acute gouty arthritis flares, an indication unique to Cortrophin Gel within the ACTH class. The Company anticipates that its dedicated sales force will focus on the appropriate patient population through podiatry and primary care physicians, while its existing sales organization will continue to focus on appropriate acute gouty arthritis flare patients seen by rheumatologists and nephrologists. The Company plans to continue to expand its Rare Disease business, through a combination of organic growth and acquisitions. The Company also plans to continue to seek opportunities to enhance its capabilities through strategic partnerships and acquisitions of assets and businesses.

The Company expects to continue to expand its Generics and Other segment through continued investment in its research and development capabilities and increased focus on niche opportunities. The Company has begun to increase its focus on niche lower competition opportunities such as injectables, paragraph IV, and competitive generic therapy designation filings. The Company also plans to continue to seek opportunities to enhance its capabilities through strategic partnerships and acquisitions of assets and businesses.

The Company expects to continue to incur significant expenditures in support of its commercial launch of Cortrophin Gel, including costs related to service contracts and increased headcount. Cost of sales, as a percentage of net revenues, decreased to 38.6% ³³ for the year ended December 31, 2025, from 40.7% ³⁴ for the same period in 2024, primarily due to the non-recurrence of $13.6 million ³⁵ of inventory step-up related to the acquisition of Alimera during 2024.

The Company expects to continue to incur significant expenditures in support of its commercial launch of Cortrophin Gel, including costs related to service contracts and increased headcount. The Company expects to continue to expand its Rare Disease business, through a combination of organic growth and acquisitions. The Company also plans to continue to seek opportunities to enhance its capabilities through strategic partnerships and acquisitions of assets and businesses.

The Company expects to continue to incur significant expenditures in support of its commercial launch of Cortrophin Gel, including costs related to service contracts and increased headcount. The Company expects to continue to expand its Rare Disease business, through a combination of organic growth and acquisitions. The Company also plans to continue to seek opportunities to enhance its capabilities through strategic partnerships and acquisitions of assets and businesses.

The Company faces competition from major pharmaceutical companies, specialty pharmaceutical companies and biotechnology companies worldwide. The Company's approved products, including Cortrophin Gel and ILUVIEN, may not achieve commercialization at levels of market acceptance that will allow the Company to maintain profitability. The Company may face substantial competition from competitors that discover, develop or commercialize competing products before or more successfully than the Company does. The Company's ability to generate significant net product revenues from ILUVIEN, Cortrophin Gel or any other products for which it receives marketing approval will depend upon numerous factors, including successfully establishing and maintaining effective sales, marketing, and distribution systems, successfully establishing and maintaining manufacturing capabilities with third-party suppliers and contract manufacturers, broad acceptance of the products by physicians and patients, the acceptance of pricing and placement of the products on payers' formularies, effectively competing with other products, continued demonstration of safety and efficacy, the ability to comply with ongoing regulatory obligations, and obtaining, maintaining, enforcing, and defending intellectual property rights and claims.

The Company is subject to extensive regulation by governmental authorities in the U.S. and in other countries in which it sells its products. The Company is subject to federal, state, and local laws and regulations, and complying with these may cause the Company to incur significant additional costs. The Company's operations in international markets subject it to additional regulatory oversight both in the international market and in the U.S., as well as social and political uncertainties. U.S. healthcare reform initiatives may materially and adversely affect the Company's business and operating results. The Company is subject to risks associated with having assets and operations located in foreign jurisdictions, including limitations on ownership or participation in local enterprises, price controls, exchange controls, and limitations on repatriation of earnings, transportation delays and interruptions, the application of additional legal, regulatory and taxation regimes, political, social, and economic instability, acts of terrorism, government embargoes or foreign trade restrictions, imposition of duties and tariffs and other trade barriers, import and export controls, labor unrest, fluctuations in foreign current exchange and interest rates, difficulties in staffing and managing multi-national operations, and limitations on the ability to enforce legal rights and remedies.

The Company's approved products, including Cortrophin Gel and ILUVIEN, may not achieve commercialization at levels of market acceptance that will allow the Company to maintain profitability. The Company is dependent on a limited number of suppliers for API, and generally only a single source of API is qualified for use in each product. Several of the Company's products are manufactured and/or packaged by single source third parties, which the Company cannot control. The Company is subject to extensive and complex U.S. healthcare and other laws, as well as comparable laws and regulations in foreign jurisdictions, and failure to comply could result in substantial penalties. The Company's Medicaid rebate accruals have increased due to acquisitions and subsequent sales of branded products and authorized generics, and the estimates on which the accruals are based are subject to change. The Company's accruals for the Medicare Manufacturer Discount Program have increased due to growth and acquisitions. The Company may be adversely affected by the expiration of patents that protect key aspects of ILUVIEN and YUTIQ in the near- to medium-term, including one U.S. patent that will expire in August 2027 ³⁶ and a second U.S. patent relating to ILUVIEN that will expire in November 2028 ³⁷. The Company's ability to receive aggregated potential sales milestone payments of up to $89.0 million ³⁸ from Ocumension depend upon achievement by Ocumension of specified amounts of net sales of ILUVIEN in that region.

Management's message emphasizes the Company's mission of "Serving Patients, Improving Lives" and its strategy to build a sustainable and growing biopharmaceutical company. The key strategic priorities include building a successful Rare Disease and Brands segment, strengthening the Generics and Other segment, and pursuing acquisitions and strategic transactions. Management highlights the acquisition of Alimera as strengthening the Rare Disease business and expanding the Company's footprint beyond the U.S. Management also notes the FDA approval of an expanded label for ILUVIEN and the transition of promotional efforts from YUTIQ to ILUVIEN. The Company expects that its robust pipeline will continue to yield approximately 10 to 15 ³⁹ new product launches per year.