COLLEGIUM PHARMACEUTICAL, INC

Collegium Pharmaceutical, Inc. operates within the biopharmaceutical industry, focusing on the development and commercialization of products for the treatment of attention deficit hyperactivity disorder (ADHD) and moderate to severe pain. The company's portfolio includes products for ADHD and pain management, with its ADHD product, Jornay PM, being the only FDA-approved stimulant medication dosed in the evening. The pain management market is characterized by a high prevalence of chronic pain, affecting 24.3% ¹ of adults in the United States, with 8.5% ² suffering from high-impact chronic pain. The economic costs of chronic pain in the United States were estimated to be $722.8 billion ³ in 2021. The opioid market is under significant regulatory and social pressure, with prescription levels declining, as in 2025 there were approximately 133.2 million ⁴ prescriptions for opioids written in the United States, a 2.4% ⁵ decline from 2023 levels. The company positions itself within this landscape by offering differentiated products, including an abuse-deterrent formulation for its opioid product Xtampza ER.

Collegium's primary competitors include major multinational pharmaceutical companies and generic drug manufacturers. In the pain market, competitors include Actavis, Endo, Mallinckrodt, Purdue, Teva, and Vertex Pharmaceuticals Incorporated, which in January 2025 obtained approval for suzetrigine for the treatment of moderate to severe acute pain in adults. In the ADHD market, Jornay PM competes with branded and generic methylphenidate products from companies such as J&J Innovative Medicines, Supernus Pharmaceuticals, Inc., Tris Pharma, Novartis AG, Noven Therapeutics, LLC, UCB SA, Aytu BioScience, Inc., and Adlon Therapeutics, Inc. The company's stated competitive advantages include its abuse-deterrent technology platform, DETERx, for Xtampza ER, and the unique evening-dosing profile of Jornay PM. The company's pain sales force consists of approximately 105 ⁶ sales representatives and managers that call on approximately 10,000 ⁷ health care professionals who write approximately 67% ⁸ of branded extended-release opioid prescriptions. Its ADHD sales force consists of approximately 200 ⁹ sales representatives and managers that call on approximately 21,000 ¹⁰ health care professionals who write approximately 60% ¹¹ of pediatric and adolescent extended release stimulant prescriptions.

Collegium generates revenue through the sale of its commercial products in the United States. The company's revenue is derived from product sales, which are recorded upon delivery to customers, net of provisions for chargebacks, rebates, sales incentives, allowances, distribution service fees, and returns. The company's primary customer segments are wholesale pharmaceutical distributors, which then distribute products to retail outlets, managed health care organizations, and government agencies. The company's business model is centered on a portfolio of meaningfully differentiated products, with a mix of recurring revenue from chronic pain and ADHD treatments. The company commercializes its products through two dedicated field sales forces, one focused on its pain portfolio and the other on ADHD, and employs a market-access team to support formulary approval and payor contracting.

Collegium's product portfolio consists of six key products. Jornay PM, acquired in September 2024, is a central nervous system stimulant prescription medicine containing methylphenidate HCl, a Schedule II controlled substance, approved for the treatment of ADHD in people six years of age and older. Belbuca is a buccal film containing buprenorphine, a Schedule III opioid, approved for severe and persistent pain. Xtampza ER is an abuse-deterrent, extended-release, oral formulation of oxycodone, a Schedule II opioid, formulated using the DETERx technology platform. The Nucynta Products, which include Nucynta ER and Nucynta IR, are extended-release and immediate-release oral formulations of tapentadol, a Schedule II opioid. Nucynta ER is indicated for severe and persistent pain, including neuropathic pain associated with diabetic peripheral neuropathy, while Nucynta IR is indicated for acute pain. Symproic is an oral formulation of naldemedine, not a controlled substance, approved for the treatment of opioid-induced constipation in adult patients with chronic non-cancer pain. For the year ended December 31, 2025, product revenues, net were $780.567 million ¹², with Belbuca contributing $221.653 million ¹³, Xtampza ER contributing $199.308 million ¹⁴, Jornay PM contributing $148.857 million ¹⁵, Nucynta IR contributing $115.312 million ¹⁶, Nucynta ER contributing $80.985 million ¹⁷, and Symproic and other contributing $14.452 million ¹⁸.

The company's product portfolio also includes the Nucynta Products and Symproic, which are part of its pain management offerings. The Nucynta Products are protected by patents, with Nucynta IR protected by one issued patent that expired in 2025, and Nucynta ER protected by three issued patents, two of which are projected to expire in 2028 and 2029. Nucynta IR also benefits from New Patient Population exclusivity in pediatric patients, projected to expire in 2027, and pediatric exclusivity granted in June 2024, extending exclusivity to January 3, 2027 for Nucynta IR and December 27, 2025 for Nucynta ER. Symproic is manufactured pursuant to supply agreements with third-party manufacturers, including UPM Pharmaceuticals and Sharp Packaging Solutions. The company has entered into an authorized generic agreement with Hikma Pharmaceuticals USA Inc. for the Nucynta Products. In January 2026, a generic equivalent of Nucynta IR was approved, leading Hikma to launch a generic version of Nucynta IR on February 25, 2026, with a generic version of Nucynta ER expected in the first quarter of 2026.

During the period, Collegium completed the acquisition of Ironshore Therapeutics Inc. on September 3, 2024, for a total purchase consideration of approximately $306.104 million ¹⁹. The acquisition added Jornay PM to the company's portfolio. The company also entered into a new Credit Agreement on December 23, 2025, which includes a $580.0 million ²⁰ term loan, a $300.0 million ²¹ delayed draw term loan, and a $100.0 million ²² revolving credit facility. The proceeds from the 2025 Term Loan were used to repay the 2024 Term Loan. The company repurchased 2,704,830 ²³ shares at a weighted-average price of $31.43 ²⁴ per share for a total of $85.0 million ²⁵ under its 2024-2025 Repurchase Program. In July 2025, the Board authorized a new share repurchase program for up to $150.0 million ²⁶ of shares through December 31, 2026. As of December 31, 2025, $150.0 million ²⁷ remained available for repurchase under this program. The company also repurchased 822,128 ²⁸ shares for $25.005 million ²⁹ during the year ended December 31, 2025.

For the fiscal year ended December 31, 2025, Collegium reported total product revenues, net of $780.567 million ³⁰, compared to $631.449 million ³¹ in the prior year, representing a $149.2 million ³² increase. Net income was $62.870 million ³³, compared to $69.190 million ³⁴ in 2024. Diluted earnings per share were $1.73 ³⁵, compared to $1.86 ³⁶ in the prior year. Gross profit increased to $463.257 million ³⁷ from $377.344 million ³⁸ in 2024. Income from operations was $179.636 million ³⁹, compared to $169.895 million ⁴⁰ in the prior year. The company generated $329.323 million ⁴¹ in cash from operating activities, up from $204.980 million ⁴² in 2024. Adjusted EBITDA, a non-GAAP measure, was $460.495 million ⁴³ for 2025, compared to $401.190 million ⁴⁴ for 2024.

A major growth vector for Collegium is the expansion of its ADHD franchise through Jornay PM, which was acquired in September 2024. The company is investing in its ADHD sales force, which consists of approximately 200 ⁴⁵ sales representatives and managers, to call on approximately 21,000 ⁴⁶ health care professionals who write approximately 60% ⁴⁷ of pediatric and adolescent extended release stimulant prescriptions. The company expects to continue growing Jornay PM sales, as evidenced by the full year of revenue contribution in 2025 compared to a partial year in 2024. The company also has a contract with Knight Therapeutics, Inc. for the right to sell Jornay PM in Canada and certain countries in Latin America, subject to regulatory approval, which represents a geographic expansion opportunity. Product shipments to Knight commenced during the three months ended September 30, 2025.

Another growth vector is the company's pain portfolio, which includes Belbuca, Xtampza ER, and the Nucynta Products. The company continues to focus on its pain sales force of approximately 105 ⁴⁸ sales representatives and managers targeting approximately 10,000 ⁴⁹ health care professionals. The company is also managing the lifecycle of the Nucynta Products through its authorized generic agreement with Hikma, which launched a generic version of Nucynta IR on February 25, 2026, and is expected to launch a generic version of Nucynta ER in the first quarter of 2026. The company is also defending its intellectual property for Belbuca against generic challenges, including litigation with Alvogen and Chemo Research, S.L., which could impact future revenue streams. The company is also monitoring the impact of new non-opioid oral analgesics, such as Vertex's suzetrigine, which was approved in January 2025.However, the company's cost structure is influenced by intangible asset amortization, which was $221.892 million ⁵⁰ for 2025, and selling, general and administrative expenses, which were $284.803 million ⁵¹ for 2025. The company expects selling, general and administrative expenses to continue to be substantial for the foreseeable future as it invests in the commercialization of its products. The company also has royalty obligations under its license agreements, including the Grünenthal License for the Nucynta Products and the Shionogi License for Symproic. The company's effective tax rate was 32.1% ⁵² for 2025.

The filing does not provide a specific operational outlook regarding supply chain, manufacturing capacity, or technology infrastructure investments. The company relies on third-party manufacturers for all of its products, including Patheon for Xtampza ER and Nucynta ER, and has a dedicated manufacturing suite at Patheon's facility for Xtampza ER. The company also relies on sole or limited suppliers for active pharmaceutical ingredients. The company has 423 ⁵³ full-time employees as of December 31, 2025.

The company's capital allocation strategy includes significant debt service obligations. As of December 31, 2025, the company had $580.0 million ⁵⁴ in principal outstanding under the 2025 Term Loan and $241.5 million ⁵⁵ in 2.875% convertible senior notes due in 2029. The company also has a $150.0 million ⁵⁶ share repurchase authorization under the 2025-2026 Repurchase Program, though no shares had been purchased under this program as of December 31, 2025. The company does not pay dividends on its common stock. The company's capital expenditures were $1.740 million ⁵⁷ for the year ended December 31, 2025. The company's research and development expenses were zero after the three months ended March 31, 2022, as the company has focused entirely on commercial products.

A significant headwind for Collegium is the ongoing regulatory and social pressure on opioid medications. The company faces risks from potential changes in FDA labeling, such as the July 2025 announcement requiring safety-related labeling changes for all opioid pain medications. The company also faces risks from the potential for generic competition, as evidenced by the approval of a generic equivalent of Nucynta IR and the expected launch of a generic version of Nucynta ER. The company is also subject to the Opioid Analgesic REMS program, which could be modified to impose additional burdens. The company faces litigation risks, including opioid-related lawsuits and patent infringement litigation, which could result in significant costs and liabilities.

Another constraint is the company's substantial outstanding indebtedness, which was $821.5 million ⁵⁸ in total principal as of December 31, 2025. This debt requires significant cash flows for interest and principal payments, with interest expense of $82.312 million ⁵⁹ for 2025. The company's debt agreements contain financial covenants that could limit its operational flexibility. The company is also exposed to interest rate risk on its variable-rate term loan, with a hypothetical 1% increase in interest rates potentially increasing annual interest expense by approximately $5.8 million ⁶⁰. The company also faces risks related to its reliance on a limited number of customers, with three customers comprising 34% ⁶¹, 34% ⁶², and 29% ⁶³ of revenue during 2025.

The company's most material risks include its substantial outstanding indebtedness, with $580.0 million ⁶⁴ in principal under the 2025 Term Loan and $241.5 million ⁶⁵ in 2.875% convertible senior notes due in 2029, which requires significant cash flows for debt service and contains restrictive covenants. The company faces intense competition from generic entrants, as evidenced by the approval of a generic equivalent of Nucynta IR and the expected launch of a generic version of Nucynta ER, which could materially reduce revenue from the Nucynta Products. The company is also exposed to significant litigation risk, including an arbitration claim from North Sound Pharmaceuticals seeking compensatory damages estimated to be in excess of $500,000 ⁶⁶, and a lawsuit from Walgreen Co. alleging more than $14,000 ⁶⁷ in credits for returned product. The company's business is heavily dependent on a limited number of wholesale distributors, with three customers comprising 34% ⁶⁸, 34% ⁶⁹, and 29% ⁷⁰ of revenue during 2025, and the loss of any significant distributor could materially adversely affect financial condition. Finally, the company's opioid products are subject to extensive and evolving government regulation, including the Opioid Analgesic REMS and potential new taxes or fees, which could increase operating costs and reduce market demand.

Management's message emphasizes the company's mission to build a leading, diversified biopharmaceutical company committed to improving the lives of people living with serious medical conditions. The key strategic priorities for the period ahead include continuing to successfully commercialize the company's product portfolio, which includes Jornay PM, Belbuca, Xtampza ER, the Nucynta Products, and Symproic. Management also focuses on integrating the Ironshore acquisition and expanding the ADHD franchise through Jornay PM. The company is also focused on managing its capital structure, as evidenced by the refinancing of its term loan in December 2025.