UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q


☒		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended JuneSeptember 30, 2025


☐		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _ to _

Commission file number: 001-33221

HERON THERAPEUTICS, INC.

(Exact name of registrant as specified in its charter)


Delaware (State or other jurisdiction of incorporation or organization)	94-2875566 (I.R.S. Employer Identification No.)

100 Regency Forest Drive, Suite 300 Cary, North Carolina	27518
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code: (858) 251-4400

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	HRTX	The Nasdaq Capital Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☑

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

The number of shares of the registrant's common stock, par value $0.01 per share, outstanding as of ~~July~~October 3130, 2025 was ~~153~~183,~~291~~362,~~798~~522.

HERON THERAPEUTICS, INC.

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED ~~JUNE~~SEPTEMBER 30, 2025

TABLE OF CONTENTS

PART I.	FINANCIAL INFORMATION
ITEM 1.	Condensed Consolidated Financial Statements
	Condensed Consolidated Balance Sheets as of June 30, 2025 (Unaudited) and December 31, 2024	5
	Condensed Consolidated Balance Sheets as of September 30, 2025 (Unaudited) and December 31, 2024	5
	Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income for the Three and Six Months Ended June 30, 2025 and 2024 (Unaudited)	6
	Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three and Nine Months Ended September 30, 2025 and 2024 (Unaudited)	6
	Condensed Consolidated Statements of Stockholders' Deficit for the Three and Six Months Ended June 30, 2025 and 2024 (Unaudited)	7
	Condensed Consolidated Statements of Stockholders' Equity (Deficit) for the Three and Nine Months Ended September 30, 2025 and 2024 (Unaudited)	7
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024 (Unaudited)	8
	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2025 and 2024 (Unaudited)	9
	Notes to Condensed Consolidated Financial Statements (Unaudited)	910
ITEM 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	2324
ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk	2932
ITEM 4.	Controls and Procedures	2932
PART II.	OTHER INFORMATION
ITEM 1.	Legal Proceedings	3033
ITEM 1A.	Risk Factors	3135
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3637
ITEM 3.	Defaults upon Senior Securities	3637
ITEM 4.	Mine Safety Disclosures	3637
ITEM 5.	Other Information	3637
ITEM 6.	Exhibits	3738
	SIGNATURES	3840

In this Quarterly Report on Form 10-Q, all references to "Heron," the "Company," "we," "us," "our" and similar terms refer to Heron Therapeutics, Inc. and its wholly owned subsidiary, Heron Therapeutics B.V. Heron Therapeutics®, the Heron logo, ZYNRELEF®, APONVIE®, CINVANTI®, SUSTOL®, and Biochronomer® are our trademarks, which are protected under applicable intellectual property laws and are the property of Heron. All other trademarks appearing or incorporated by reference into this Quarterly Report on Form 10-Q are the property of their respective owners. Solely for convenience, the trademarks referred to in this Quarterly Report on Form 10-Q may appear without the ®, ™ or SM symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the right of the applicable licensor to these trademarks. We do not intend our use or display of other parties' trademarks to imply, and such use or display should not be construed to imply, a relationship with, or endorsement or sponsorship of us by, these other parties.

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the federal securities laws. We make such forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). In some cases, you can identify forward-looking statements by the use of the words "anticipate," "assume," "believe," "could," "estimate," "expect," "intend," "may," "might," "project," "should," "will," "would," and other expressions that predict or indicate future events and trends and which do not relate to historical matters. All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q, including statements regarding our future results of operations and financial position, business and commercialization strategy, products and product candidates, research pipeline, ongoing and planned preclinical studies and clinical trials, regulatory submissions and approvals, addressable patient population, research and development expenses, timing and likelihood of success, as well as plans and objectives of management for future operations, are forward-looking statements. You should not rely on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, some of which are beyond our control. These risks, uncertainties and other factors may cause our actual results, performance or achievements to be materially different from our anticipated future results, performance or achievements expressed or implied by the forward-looking statements.

Forward-looking statements ~~includes~~include, but are not limited to, statements including:

•

our ability to successfully commercialize, market and achieve market acceptance of ZYNRELEF® (bupivacaine and meloxicam) extended-release solution ("ZYNRELEF"), APONVIE® (aprepitant) injectable emulsion ("APONVIE"), CINVANTI® (aprepitant) injectable emulsion ("CINVANTI"), and SUSTOL® (granisetron) extended-release injection ("SUSTOL" and together with ZYNRELEF, APONVIE and CINVANTI, our "Products") in the United States ("U.S."), and our positioning relative to products that now or in the future compete with our Products or product candidates;

•

our estimates regarding the potential market opportunities for our Products and our product candidates, if approved, and our ability to capture the potential additional market opportunity from the expanded ZYNRELEF label approved in the U.S.;

•

our ability to establish and maintain successful commercial arrangements, including our co-promotion agreement with CrossLink Network, LLC ("CrossLink Network");

•

the realization of anticipated benefits from our co-promotion agreement with CrossLink Network;

•

the timing and outcome of our pending patent litigations;

•

whether we are required to write-off any additional inventory in the future;

•

our ability to establish satisfactory pricing and obtain adequate reimbursement from government and third-party payors of our Products and product candidates that receive regulatory approvals;

•

whether clinical trials of our Products and product candidates are indicative of the results in future clinical trials;

•

our ability to successfully launch our ZYNRELEF Vial Access Needle ("VAN") in the U.S.;

•

our ability to develop, acquire and advance product candidates into, and successfully complete, clinical trials, and our ability to submit for and obtain regulatory approval for product candidates in our anticipated timing, or at all;

•

the clinical utility of our Products and product candidates and their potential advantages compared to other treatments;

•

our competitors’ activities, including decisions as to the timing of competing product launches, generic entrants, pricing and discounting;

•

the safety and efficacy results of our clinical trials and other required studies for expansion of the indications for our Products and approval of our product candidates and the data to support such clinical trials, potential regulatory approval or further development of any of our Products or product candidates;

•

our ability to meet the postmarketing study requirements within the mandated timelines of the U.S. Food and Drug Administration ("FDA") and to obtain favorable results and comply with standard postmarketing requirements, including U.S. federal advertising and promotion laws, federal and state anti-fraud and abuse laws, healthcare information privacy

and security laws, safety information, safety surveillance and disclosure of payments or other transfers of value to healthcare professionals and entities for Products or any of our product candidates;

•

our ability to successfully develop and achieve regulatory approval for any product candidates utilizing our proprietary Biochronomer® drug delivery technology ("Biochronomer Technology");

•

our ability to establish key collaborations and vendor relationships for our Products and our product candidates;

•

our ability to successfully develop and commercialize any technology that we may in-license or products we may acquire;

•

our ability to establish and maintain arrangements for the manufacture of our Products and product candidates and the ability and sufficiency of our current manufacturing third-party partners to produce clinical and commercial quantities of our Products and product candidates without delays, supply constraints or changes in the regulatory or geopolitical environment;

•

the failure to renew, or the revocation of, any license or other required permits;

•

our ability to successfully operate in non-U.S. jurisdictions in which we may choose to do business, including compliance with applicable regulatory requirements and laws;

•

our ability to obtain and enforce intellectual property rights to protect our Products, our product candidates, our Biochronomer Technology and our other technology;

•

our ability to successfully defend ourselves against pending or threatened litigation or investigations, including unforeseen third-party infringement claims involving our Products and product candidates;

•

our inability or delay in achieving or sustaining profitability;

•

the impacts of global economic and political developments on our business and the financial market, including the impact of geopolitical conflicts and acts of war, terrorism and civil disorder, global pandemics and other public health emergencies, tariffs and other trade protection measures, changes to interest rates and inflationary pressure, natural and man-made disasters, and other sources of volatility, which could result in economic slowdowns or recessions and market disruptions and adversely affect our financial condition, results of operations and cash flows;

•

the impact of evolving legal and regulatory requirements and interpretations thereof, including legislative or executive actions, policy changes in governmental agencies and judicial decisions overturning or establishing new precedents;

•

changes in the industry we operate;

•

our ability to retain, attract and hire key personnel;

•

our estimates regarding our capital requirements;

•

our ability to obtain additional financing and raise capital as necessary to fund operations or pursue business opportunities;

•

the cost and availability of capital and any restrictions imposed by lenders or creditors; and

•

the volatility and unpredictability of the stock market, credit market conditions and impact on the value of our common stock and our ability to access capital markets.

You should refer to the "Risk Factors" section of our Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on February 27, 2025, (the "2024 Annual Report"), Quarterly reports on Form 10-Q and other reports for a discussion of important factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. Any forward-looking statements in this Quarterly Report on Form 10-Q reflect our current views with respect to future events or to our future financial performance. Given these uncertainties, you should not place undue reliance on these forward-looking statements. These forward-looking statements were based on information, plans and estimates as of the date of this Quarterly Report on Form 10-Q, and while we may elect to update these forward-looking statements in our future filings under the Exchange Act, we assume no obligation to update any forward-looking statements to reflect changes in underlying assumptions or

factors, new information, future events or other changes, ~~and~~ except as required by law. You should therefore not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this Quarterly Report on Form 10-Q.

PART I. FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

HERON THERAPEUTICS, INC.

Condensed Consolidated Balance Sheets

(In thousands)

	June 30,2025			December 31,2024
	September 30,2025			December 31,2024
	(Unaudited)			(See Note 2)
ASSETS
Current assets:
Cash and cash equivalents	$	1643,~~516~~068		$	25,802
Short-term investments		2412,~~117~~419			33,481
Accounts receivable, net		7981,~~931~~047			78,881
Inventory, net		7270,~~965~~025			53,160
Prepaid expenses and other current assets		1722,~~394~~841			17,690
Total current assets		~~210~~229,~~923~~400			209,014
Property and equipment, net		1312,~~683~~960			14,863
Right-of-use lease assets		~~1,401~~708			2,787
Other assets		65,~~083~~882			6,483
Total assets	$	~~232~~248,~~090~~950		$	233,147
LIABILITIES AND STOCKHOLDERS' DEFICIT
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	12,~~037~~017		$	11,709
Accrued clinical and manufacturing liabilities		1719,~~135~~663			25,402
Accrued payroll and employee liabilities		68,~~471~~748			9,554
Notes payable, net		25,398			—
Other accrued liabilities		48,500			41,755
Convertible notes payable, net		149,806			—
Current lease liabilities		780			3,037
Other accrued liabilities		46,215			41,755
Total current liabilities		89,708			91,457
Current lease liabilities		1,539			3,037
Non-current notes payable, net		107,487			25,026
Total current liabilities		258,601			91,457
Non-current convertible notes payable, net		32,176			149,700
Non-current notes payable, net		—			25,026
Other non-current liabilities		4,694			615
Non-current convertible notes payable, net		—			149,700
Total liabilities		234,065			266,798
Other non-current liabilities		747			615
Stockholders' equity (deficit):
Total liabilities		259,348			266,798
Common stock		1,833			1,521
Stockholders' deficit:
Series A convertible preferred stock		7,862			—
Common stock		1,533			1,521
Additional paid-in capital		1,942,025			1,884,409
Additional paid-in capital		1,890,550			1,884,409
Accumulated other comprehensive loss		—			13
Accumulated other comprehensive (loss) income		(1	)		13
Accumulated deficit		(1,936,835	)		(1,919,594	)
Accumulated deficit		(1,919,340	)		(1,919,594	)
Total stockholders' equity (deficit)		14,885			(33,651	)
Total stockholders' deficit		(27,258	)		(33,651	)
Total liabilities and stockholders' equity (deficit)	$	248,950		$	233,147
Total liabilities and stockholders' deficit	$	232,090		$	233,147

See accompanying notes.

HERON THERAPEUTICS, INC.

Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income

(Unaudited)

(In thousands, except per share amounts)

	Three Months Ended June 30,						Six Months Ended June 30,
	Three Months Ended September 30,						Nine Months Ended September 30,
	2025			2024			2025			2024
Revenues:
Net product sales	$	3738,~~200~~213		$	3632,~~024~~810		$	76114,~~103~~316		$	70103,~~694~~504
Cost of product sales		911,~~857~~914			109,~~518~~458			1830,~~314~~228			1828,~~962~~420
Gross profit		2726,~~343~~299			2523,~~506~~352			5784,~~789~~088			5175,~~732~~084
Operating expenses:
Research and development		23,~~934~~470			4,~~432~~465			58,~~213~~683			913,~~040~~505
General and administrative		1413,~~471~~980			1312,~~905~~373			2741,~~173~~153			2841,~~879~~252
Sales and marketing		1112,~~575~~942			1310,~~614~~972			2336,~~886~~828			2536,~~056~~028
Total operating expenses		2830,~~980~~392			3127,~~951~~810			5686,~~272~~664			6290,~~975~~785
(Loss) income from operations		(1,637	)		(6,445	)		1,517			(11,243	)
Loss from operations		(4,093	)		(4,458	)		(2,576	)		(15,701	)
Other expense, net		(744	)		(2,790	)		(1,263	)		(1,152	)
Loss on debt extinguishment		(11,339	)		—			(11,339	)		—
Net (loss) income		(2,381	)		(9,235	)		254			(12,395	)
Other expense, net		(2,063	)		(390	)		(3,326	)		(1,542	)
Net loss		(17,495	)		(4,848	)		(17,241	)		(17,243	)
Other comprehensive loss:
Unrealized loss on short-term investments		(2	)		(2	)		(14	)		(21	)
Unrealized gain (loss) on short-term investments		1			48			(13	)		27
Comprehensive (loss) income	$	(2,383	)	$	(9,237	)	$	240		$	(12,416	)
Comprehensive loss	$	(17,494	)	$	(4,800	)	$	(17,254	)	$	(17,216	)
Basic net (loss) income per share	$	(0.02	)	$	(0.06	)	$	0.00		$	(0.08	)
Basic and diluted net loss per share	$	(0.10	)	$	(0.03	)	$	(0.11	)	$	(0.11	)
Diluted net (loss) income per share	$	(0.02	)	$	(0.06	)	$	0.00		$	(0.08	)
Weighted average common shares outstanding, basic and diluted		170,348			152,830			159,524			152,213
Weighted average common shares outstanding, basic		154,020			152,305			153,804			151,900
Weighted average common shares outstanding, diluted		154,020			152,305			197,751			151,900

See accompanying notes.

HERON THERAPEUTICS, INC.

Condensed Consolidated Statements of Stockholders' Equity (Deficit)

(Unaudited)

(In thousands)

	Common Stock				Series A Preferred Stock
	Shares		Amount		~~Additional Paid-InCapital~~Shares		~~Accumulated Other Comprehensive(Loss) Income~~Amount			~~Accumulated~~Additional ~~Deficit~~Paid-InCapital			~~Total~~Accumulated ~~Stockholders'Deficit~~Other Comprehensive (Loss) Income			Accumulated Deficit			Total Stockholders'Equity (Deficit)
Balance as of December 31, 2024		152,128	$	1,521	$	~~1,884,409~~—	$	13—		$	(1,~~919~~884,~~594~~409	)	$	~~(33,651~~13	)	$	(1,919,594	)	$	(33,651	)
Issuance of common stock under equity incentive plan		299		3		61—		—			—61			64—			—			64
Stock-based compensation expense		—		—		~~2,511~~—		—			—2,511			~~2,511~~—			—			2,511
Net income		—		—		—		—			~~2,635~~—			~~2,635~~—			2,635			2,635
Net unrealized loss on short-term investments		—		—		—		~~(12~~—	)		—			(12	)		—			(12	)
Comprehensive income														~~2,623~~						2,623
Balance as of March 31, 2025 (unaudited)		152,427		1,524		~~1,886,981~~—		1—			(1,~~916~~886,~~959~~981	)		~~(28,453~~1	)		(1,916,959	)		(28,453	)
Issuance of common stock under equity incentive plan		438		5		~~189~~—		—			—189			~~194~~—			—			194
Issuance of common stock under the employee stock purchase plan		388		4		~~583~~—		—			—583			~~587~~—			—			587
Stock-based compensation expense		—		—		~~2,797~~—		—			—2,797			~~2,797~~—			—			2,797
Net loss		—		—		—		—			~~(2,381~~—	)		~~(2,381~~—	)		(2,381	)		(2,381	)
Net unrealized loss on short-term investments		—		—		—		(2—	)		—			(2	)		—			(2	)
Comprehensive loss														~~(2,383~~	)					(2,383	)
Balance as of June 30, 2025 (unaudited)		153,253	$	1,533	$	~~1,890,550~~—	$	(1—	)	$	(1,~~919~~890,~~340~~550	)	$	(~~27,258~~1	)		(1,919,340	)		(27,258	)
Issuance of common stock under equity incentive plan		179		1		—		—			(52	)		—			—			(51	)
Issuance of common stock in settlement of 2026 Convertible Notes		16,667		167		—		—			30,500			—			—			30,667
Issuance of common stock in a private placement equity offering		13,225		132		—		—			18,175			—			—			18,307
Issuance of Series A convertible preferred stock in a private placement equity offering		—		—		524		7,862			—			—			—			7,862
Stock-based compensation expense		—		—		—		—			2,852			—			—			2,852
Net loss		—		—		—		—			—			—			(17,495	)		(17,495	)
Net unrealized gain on short-term investments		—		—		—		—			—			1			—			1
Comprehensive loss																				(17,494	)
Balance as of September 30, 2025 (unaudited)		183,324	$	1,833		524	$	7,862		$	1,942,025		$	-		$	(1,936,835	)	$	14,885

	Common Stock
	Shares		Amount		Additional Paid-InCapital		Accumulated Other Comprehensive (Loss) Income			AccumulatedDeficit			Total Stockholders'(Deficit)
Balance as of December 31, 2023		150,285	$	1,503	$	1,870,525	$	13		$	(1,906,014	)	$	(33,973	)
Issuance of common stock under equity incentive plan		93		1		10		—			—			11
Stock-based compensation expense		—		—		3,375		—			—			3,375
Net loss		—		—		—		—			(3,160	)		(3,160	)
Net unrealized loss on short-term investments		—		—		—		(19	)		—			(19	)
Comprehensive loss														(3,179	)
Balance as of March 31, 2024 (unaudited)		150,378		1,504		1,873,910		(6	)		(1,909,174	)		(33,766	)
Issuance of common stock under equity incentive plan		872		9		309		—			—			318
Issuance of common stock under the employee stock purchase plan		328		3		172		—			—			175
Stock-based compensation expense		—		—		4,570		—			—			4,570
Net loss		—		—		—		—			(9,235	)		(9,235	)
Net unrealized loss on short-term investments		—		—		—		(2	)		—			(2	)
Comprehensive loss														(9,237	)
Balance as of June 30, 2024 (unaudited)		151,578	$	1,516	$	1,878,961	$	(8	)	$	(1,918,409	)	$	(37,940	)

See accompanying notes.


	Common Stock				Series A Preferred Stock
	Shares		Amount		Shares		Amount		Additional Paid-In Capital		Accumulated Other Comprehensive (Loss) Income			Accumulated Deficit			Total Stockholders' (Deficit)
Balance as of December 31, 2023		150,285	$	1,503		—	$	—	$	1,870,525	$	13		$	(1,906,014	)	$	(33,973	)
Issuance of common stock under equity incentive plan		93		1		—		—		10		—			—			11
Stock-based compensation expense		—		—		—		—		3,375		—			—			3,375
Net loss		—		—		—		—		—		—			(3,160	)		(3,160	)
Net unrealized loss on short-term investments		—		—		—		—		—		(19	)		—			(19	)
Comprehensive loss																		(3,179	)
Balance as of March 31, 2024 (unaudited)		150,378		1,504		—		—		1,873,910		(6	)		(1,909,174	)		(33,766	)
Issuance of common stock under equity incentive plan		872		9		—		—		309		—			—			318
Issuance of common stock under the employee stock purchase plan		328		3		—		—		172		—			—			175
Stock-based compensation expense		—		—		—		—		4,570		—			—			4,570
Net loss		—		—		—		—		—		—			(9,235	)		(9,235	)
Net unrealized loss on short-term investments		—		—		—		—		—		(2	)		—			(2	)
Comprehensive loss																		(9,237	)
Balance as of June 30, 2024 (unaudited)		151,578		1,516		—		—		1,878,961		(8	)		(1,918,409	)		(37,940	)
Issuance of common stock under equity incentive plan		124		1		—		—		12		—			—			13
Stock-based compensation expense		—		—		—		—		2,722		—			—			2,722
Net loss		—		—		—		—		—		—			(4,848	)		(4,848	)
Net unrealized gain on short-term investments		—		—		—		—		—		48			—			48
Comprehensive loss																		(4,800	)
Balance as of September 30, 2024 (unaudited)		151,702	$	1,517		—	$	—	$	1,881,695	$	40		$	(1,923,257	)	$	(40,005	)

7See accompanying notes.

~~HERON THERAPEUTICS, INC.~~8

HERON THERAPEUTICS, INC.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)

	Six Months EndedJune 30,
	Nine Months EndedSeptember 30,
	2025			2024
Operating activities:
Net income (loss)	$	254		$	(12,395	)
Net loss	$	(17,241	)	$	(17,243	)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense		58,~~308~~160			710,~~945~~667
Depreciation and amortization		1,~~162~~777			1,~~330~~911
Amortization of debt discount		~~311~~505			~~180~~504
Amortization of debt issuance costs		~~106~~108			~~104~~157
Accretion of discount on short-term investments		(~~520~~650	)		(1,~~211~~754	)
Retirement and impairment of property and equipment		—409			34,~~441~~269
Loss on disposal of property and equipment		95			—
Loss on extinguishment of debt		11,339			—
Change in operating assets and liabilities:
Accounts receivable		(12,~~050~~166	)		(136,~~571~~902	)
Inventory		(1916,~~805~~865	)		(~~754~~3,840	)
Prepaid expenses and other assets		~~698~~(4,550	)		67(3,769	)
Accounts payable		~~328~~308			6,~~986~~948
Accrued clinical and manufacturing liabilities		(85,~~083~~787	)		~~(4,605~~208	)
Accrued payroll and employee related liabilities		(~~3,083~~806	)		(~~2,139~~693	)
Other accrued expenses		47,~~541~~052			~~502~~(1,212	)
Net cash used in operating activities		(1918,~~738~~407	)		(1410,~~120~~749	)
Investing activities:
Purchases of short-term investments		(3238,~~087~~214	)		(6590,~~100~~745	)
Maturities and sales of short-term investments		4159,~~958~~914			6999,~~063~~109
Purchases of property and equipment		(317	)		(~~637~~1,068	)
Proceeds from sale of property and equipment		5382			—
Net cash provided by investing activities		921,~~607~~465			37,~~326~~296
Financing activities:
Receipts for stock issued under the equity incentive plan		258			328
Proceeds from the sale of common stock		19,838			—
Cash paid for issuance costs of stock		(1,531	)		—
Proceeds from sale of Series A convertible preferred stock		7,862			—
Cash paid for 2026 Convertible Notes extinguishment		(125,000	)		—
Cash paid for notes payable extinguishment		(25,000	)		—
Proceeds from 2031 Convertible Notes issuance		33,250			—
Cash paid for 2031 Convertible Notes debt issuance costs		(1,386	)		—
Proceeds from notes payable issuance		108,787			—
Cash paid for notes payable debt issuance cost		(3,406	)		—
Proceeds from purchases under the employee stock purchase plan		587			175
Net cash provided by financing activities		845			503
Receipts for stock issued under the equity incentive plan		207			342
Net decrease in cash and cash equivalents		(9,286	)		(10,291	)
Net cash provided by financing activities		14,208			517
Net increase (decrease) in cash and cash equivalents		17,266			(2,936	)
Cash and cash equivalents at beginning of period		25,802			28,677
Cash and cash equivalents at end of period	$	1643,~~516~~068		$	1825,~~386~~741
Supplemental disclosure of cash flow information:
Interest paid	$	23,~~412~~862		$	23,~~426~~088

See accompanying notes.

HERON THERAPEUTICS, INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

1. Business

We are a commercial-stage biotechnology company focused on improving the lives of patients by developing and commercializing therapeutic innovations that improve medical care. Our advanced science, patented technologies, and innovative approach to drug discovery and development have allowed us to create and commercialize a portfolio of products that aim to advance the standard of care for acute care and oncology patients.

ZYNRELEF® (bupivacaine and meloxicam) extended-release solution ("ZYNRELEF") is approved in the United States ("U.S.") for the management of postoperative pain. APONVIE® (aprepitant) injectable emulsion ("APONVIE") is approved in the U.S. for the prevention of postoperative nausea and vomiting. CINVANTI® (aprepitant) injectable emulsion ("CINVANTI") and SUSTOL® (granisetron) extended-release injection ("SUSTOL") are both approved in the U.S. for the prevention of chemotherapy-induced nausea and vomiting.

~~Liquidity~~As of September 30, 2025, we had cash, cash equivalents and ~~Capital~~short-term ~~Resources~~investments of $55.5 million. Based on our current operating plan and projections, management believes that the Company's cash, cash equivalents and short-term investments will be sufficient to meet the Company's anticipated cash requirements for a period of at least one year from the issuance of the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q. We have based this estimate on assumptions that may prove wrong, and we could utilize our available capital resources sooner than we currently expect, which would have a material impact on our operations.

In accordance with Accounting Standards Codification ("ASC"), Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern (Subtopic 205-40), we have evaluated whether there are conditions or events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern within one year after the date that the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q are issued.

As of June 30, 2025, we had cash, cash equivalents and short-term investments of $40.6 million. Our $150 million aggregate principal amount of 1.5% senior convertible notes (the “1.5% senior convertible notes”) were set to mature in May 2026 and the working capital facility agreement, dated August 9, 2023, that we entered into with Hercules Capital, Inc. as administrative agent and collateral agent, and the lenders party thereto (the “Working Capital Facility Agreement” and the facility thereunder, the “Working Capital Facility”) was set to mature in May 2026 at the earliest, subject to available extensions. As of June 30, 2025, we lacked the cash, cash equivalents and short-term investments to pay the 1.5% senior convertible notes and Working Capital Facility Agreement upon maturity. On August 8, 2025, we entered into a second amendment to the Working Capital Facility Agreement (the “Credit Facility”) pursuant to which $110.0 million will be funded on the closing date, which is expected to be August 12, 2025.

Concurrently on the August 8, 2025, we entered into (i) a note purchase agreement with purchasers party thereto pursuant to which we issued and sold $35.0 million aggregate principal amount of 5.0% senior convertible notes due 2031, (ii) a securities purchase agreement with the purchasers party thereto pursuant to which we issued and sold 13,225,227 shares of common stock and 524,141 shares of Series A convertible preferred stock for aggregate gross proceeds of $29.7 million and (iii) an exchange agreement with the holders party thereto to convert $25.0 million of the 1.5% senior convertible notes into 16,666,666 shares of common stock and repay the remaining $125.0 million with borrowings under the Credit Facility (collectively, the “Concurrent Transactions” and together with the Credit Facility, the “Refinancing Transactions”). The Refinancing Transactions are expected to concurrently close on August 12, 2025.

The proceeds from the Refinancing Transactions were used to retire the 1.5% senior convertible notes and the Working Capital Facility, while also providing additional working capital to support our commercial and development initiatives.

As such, based on our current operating plan and projections, management believes that our existing cash, cash equivalents and short-term investments will be sufficient to meet our anticipated cash requirements for a period of at least one year from the date that the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q are issued.

2. Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and the requirements of the SEC for interim reporting. Accordingly, since they are interim statements, they do not include all of the information and disclosures required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and ~~six~~nine months ended ~~June~~September 30, 2025, are not necessarily indicative of the results that may be expected for other quarters or the year ending December 31, 2025. The condensed consolidated balance sheet as of December 31, 2024, has been derived from the audited consolidated financial statements as of that date. For more complete financial information, these condensed consolidated financial statements and the related notes thereto should be read in conjunction with the audited consolidated financial statements included in our 2024 Annual Report.

are not necessarily indicative of the results that may be expected for other quarters or the year ending December 31, 2025. The condensed consolidated balance sheet as of December 31, 2024, has been derived from the audited consolidated financial statements as of that date. For more complete financial information, these condensed consolidated financial statements and the related notes thereto should be read in conjunction with the audited consolidated financial statements included in our 2024 Annual Report.

3. Accounting Policies

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of Heron Therapeutics, Inc. and its wholly owned subsidiary, Heron Therapeutics B.V., which was organized in the Netherlands in March 2015. Heron Therapeutics B.V. has no operations and no material assets or liabilities, and there have been no significant transactions related to Heron Therapeutics B.V. since its inception.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and disclosures made in the accompanying notes to the financial statements. Our significant accounting policies that involve significant judgment and estimates include revenue recognition, investments, inventory and the related reserves, accrued clinical and manufacturing liabilities, income taxes, ~~and~~ stock-based compensation and accounting for debt and equity transactions. Actual results could differ materially from those estimates.

Cash, Cash Equivalents and Short-Term Investments

Cash and cash equivalents consist of cash and highly liquid investments with contractual maturities of three months or less from the original purchase date.

Short-term investments consist of securities with contractual maturities of greater than three months from the original purchase date. Securities with contractual maturities greater than one year are classified as short-term investments on the condensed consolidated balance sheets, as we have the ability, if necessary, to liquidate these securities to meet our liquidity needs in the next 12 months. We have classified our short-term investments as available-for-sale securities in the accompanying condensed consolidated financial statements. Available-for-sale securities are stated at fair market value, with net changes in unrealized gains and losses reported in other comprehensive (loss) income and realized gains and losses included in other expense, net. The cost of securities sold is based on the specific identification method. Interest and dividends on securities classified as available-for-sale are included in interest income within other expense, net.

Our bank and investment accounts have been placed under a control agreement in accordance with our working capital facility agreement (see Note 8 - Long-Term Debt and Convertible Notes).

Concentration of Credit Risk

Cash, cash equivalents and short-term investments are financial instruments that potentially subject us to concentrations of credit risk. We deposit our cash in financial institutions. At times, such deposits may be in excess of insured limits. We have not experienced any losses in such accounts and believe we are not exposed to significant risk with respect to our cash, cash equivalents and short-term investments, however, any loss incurred or a lack of access to such funds could have a significant adverse impact on the Company's financial condition, results of operations and cash flows.

We may also invest our excess cash in money market funds, U.S. government and agencies, corporate debt securities and commercial paper. We have established guidelines relative to our diversification of our cash investments and their maturities in an effort to maintain safety and liquidity. These guidelines are periodically reviewed and modified to take advantage of trends in yields and interest rates.

ZYNRELEF, APONVIE, CINVANTI and SUSTOL are distributed in the U.S. through a limited number of specialty distributors and full line wholesalers (collectively, "Customers") that resell to healthcare providers and hospitals, the end users of our Products.

The following table includes the percentage of net product sales and accounts receivable balances for our three major Customers, each of which comprised 10% or more of our product sales:

	Net Product Sales						AccountsReceivable
	Three Months EndedJune 30, 2025			Six Months EndedJune 30, 2025			As ofJune 30, 2025
	Three Months EndedSeptember 30, 2025			Nine Months EndedSeptember 30, 2025			As ofSeptember 30, 2025
Customer A		4438.28	%		4342.92	%		4340.86	%
Customer B		33.96	%		33.5	%		3433.4	%
Customer C		2025.48	%		2122.28	%		2125.35	%
Total		98.52	%		98.65	%		99.5	%

Accounts Receivable, Net

Accounts receivable are recorded at the invoice amount, net of an allowance for credit losses. The allowance for credit losses reflects accounts receivable balances that are believed to be uncollectible. In estimating the allowance for credit losses, we consider (1) our historical experience with collections and write-offs; (2) the credit quality of our Customers and any recent or anticipated changes thereto; (3) the outstanding balances and past due amounts from our Customers; and (4) reasonable and supportable forecast of economic conditions expected to exist throughout the contractual term of the receivable. As of ~~June~~September 30, 2025, and December 31, 2024, we do not have an allowance for credit losses.

Inventory, Net

Inventory is stated at the lower of cost or estimated net realizable value on a first-in, first-out, or FIFO, basis. We periodically analyze our inventory levels and write down inventory that has become obsolete, inventory that has a cost basis in excess of its estimated realizable value and inventory quantities that are in excess of expected sales requirements as cost of product sales. The determination of whether inventory costs will be realizable requires estimates by management. If actual market conditions are less ~~favorable than projected by management, additional write-downs of inventory may be required, which would be recorded as cost of product sales.~~

favorable than projected by management, additional write-downs of inventory may be required, which would be recorded as cost of product sales.

Property and Equipment, Net

Property and equipment is stated at cost less accumulated depreciation and amortization. Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets (generally 5 years). Leasehold improvements are stated at cost and amortized on a straight-line basis over the shorter of the estimated useful life of the asset or the lease term. During the three and ~~six~~nine months ended ~~June~~September 30, 2025, we incurred a loss on the write-off of property and equipment of $0.23 million and $0.5 million, respectively, which was recorded to operating expense. During the three and nine months ended ~~June~~September 30, 2024 we incurred a loss on the write-off of property and equipment of $30.18 million, ofand ~~which~~ $24.53 million, ~~relates~~respectively. toOf athe ~~project~~$4.3 million for ~~which we had a one-time settlement gain contingency related to a legal dispute, during~~ the ~~three~~nine months ended ~~March~~September 3130, 2024, $2.5 ~~This~~million ~~loss~~ was recorded to other expense, net. ~~The~~and the remaining loss was recorded to operating expense.

Leases

We determine if an arrangement is a lease or contains lease components at inception. Operating leases with an initial term greater than 12 months are recorded as lease liabilities with corresponding right-of-use ("ROU") lease assets on the condensed consolidated balance sheets. ROU lease assets represent our right to use the underlying assets over the lease term, and lease liabilities represent the present value of our obligation to make lease payments arising from the lease. Lease liabilities are recognized at the lease commencement based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. We use the implicit rate when readily determinable. The ROU lease assets equal the lease liabilities, less unamortized lease incentives, unamortized initial direct costs and the cumulative difference between rent expense and amounts paid under the lease. The lease term includes any option to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense is recognized on a straight-line basis over the lease term. We have elected the practical expedient to not separate lease and non-lease components.

Revenue Recognition

Revenue is recognized in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 606, Revenue from Contracts with Customers ("Topic 606"). Topic 606 is based on the principle that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

Product Sales

Our Products are distributed in the U.S. through a limited number of Customers that resell to healthcare providers and hospitals, the end users of our Products.

Revenue is recognized in an amount that reflects the consideration we expect to receive in exchange for our Products. To determine revenue recognition for contracts with Customers within the scope of Topic 606, we perform the following five steps: (i) identify the contract(s) with a Customer; (ii) identify the performance obligations of the contract(s); (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract(s); and (v) recognize revenue when (or as) we satisfy the performance obligations. We recognize revenue from Product sales when there is a transfer of control of the Product to our Customers. We typically determine transfer of control based on when the Product is delivered, and title passes to our Customers.

Product Sales Allowances

We recognize product sales allowances as a reduction of product sales in the same period the related revenue is recognized. Product sales allowances are based on amounts owed or to be claimed on the related sales. Such variable consideration includes estimates that take into consideration the terms of our agreements with Customers, historical product returns, rebates or discounts taken, the shelf life of the product and specific known market events, such as competitive pricing and new product introductions. If actual future results vary from our estimates, we may need to adjust these estimates, which could have an effect on product sales and earnings in the period of adjustment. Our product sales allowances include:

•

Product Returns—We allow the majority of our Customers to return product for credit beginning three months prior to the product expiration date and up to 12 months after the product expiration date. As such, there may be a significant period of time between the time the product is shipped and the time the credit is issued on returned product.

•

Distributor Fees—We pay distribution service fees to our Customers based on a contractually fixed percentage of the wholesale acquisition costs and fees for data. These fees are paid no later than two months after the quarter in which product was shipped.

•

Group Purchasing Organization ("GPO") Discounts and Rebates—We offer cash discounts to GPO members. These discounts are taken when the GPO members purchase product from our Customers, who then charge back to us the discount amount. Additionally, we offer volume and contract-tier rebates to GPO members. Rebates are based on actual purchase levels during the quarterly rebate purchase period.

•

GPO Administrative Fees—We pay administrative fees to GPOs for services and access to data. These fees are based on contracted terms and are paid after the quarter in which the product was purchased by the GPO's members.

•

Medicaid Rebates—We participate in Medicaid rebate programs, which provide assistance to certain low-income patients based on each individual state's guidelines regarding eligibility and services. Under the Medicaid rebate programs, we pay a rebate to each participating state, generally within six months after the quarter in which the product was sold.

•

Prompt Pay Discounts—We may provide discounts on product sales to our Customers for prompt payment based on contractual terms.

We believe our estimated allowance for product returns and GPO discounts requires a high degree of judgment and is subject to change based on our experience and certain quantitative and qualitative factors. We believe our estimated allowances for distributor fees, GPO rebates and administrative fees, Medicaid rebates and prompt pay discounts do not require a high degree of judgment because the amounts are settled within a relatively short period of time.

Our product sales allowances and related accruals are evaluated each reporting period and adjusted when trends or significant events indicate that a change in estimate is appropriate. Changes in product sales allowance estimates could materially affect our results of operations and financial position.

The following table provides disaggregated net product sales (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

2025

2024

2025

2024

CINVANTI net product sales

2423,~~143~~955

2422,~~927~~662

4973,~~886~~841

5073,~~544~~205

SUSTOL net product sales

21,~~404~~911

42,~~246~~763

57,~~263~~175

710,~~860~~623

ZYNRELEF net product sales

89,~~189~~313

56,~~831~~245

1625,~~230~~542

1017,~~844~~089

APONVIE net product sales

23,~~464~~034

1,~~020~~140

47,~~724~~758

12,~~446~~587

Total net product sales

3738,~~200~~213

3632,~~024~~810

76114,~~103~~316

70103,~~694~~504

The following table provides a summary of activity with respect to our product returns, distributor fees and discounts, rebates and administrative fees, which are included in other accrued liabilities on the condensed consolidated balance sheets (in thousands):

	ProductReturns			DistributorFees			Discounts,Rebates andAdministrative Fees			Total
Balance at December 31, 2024	$	3,791		$	5,883		$	27,745		$	37,419
Provision		~~962~~1,544			1725,~~188~~949			~~114~~170,~~605~~019			~~132~~197,~~755~~512
Payments/credits		(~~472~~842	)		(1725,~~028~~264	)		(~~112~~167,~~621~~462	)		(~~130~~193,~~121~~568	)
Balance at June 30, 2025	$	4,281		$	6,043		$	29,729		$	40,053
Balance at September 30, 2025	$	4,493		$	6,568		$	30,302		$	41,363

Comprehensive (Loss) ~~Income~~

Comprehensive (loss) ~~income~~ is defined as the change in equity during a period from transactions and other events and circumstances from non-owner sources. Net changes in unrealized gains and losses on available-for-sale securities are included in other comprehensive loss and represent the difference between our net (loss) ~~income~~ and comprehensive (loss) ~~income~~ for all periods presented.

~~Earnings~~Net Loss per Share

~~The~~Basic ~~computations~~net ofloss ~~the~~per ~~numerator~~share ~~(earnings~~is orcalculated by dividing the net loss) ~~and~~by ~~denominator~~the (weighted-average number of shares of common ~~shares~~stock outstanding for the period, including pre-funded warrants) to ~~calculate~~purchase ~~the~~shares ~~basic~~of ~~and~~common ~~diluted~~stock. ~~earnings~~Diluted net loss per share ~~amounts~~is ~~presented~~computed inby dividing the ~~accompanying~~net ~~condensed~~loss ~~consolidated~~by ~~statements~~the weighted-average number of ~~operations~~shares of common stock and ~~comprehensive~~common ~~(loss)~~stock ~~income~~equivalents outstanding for the period determined using the treasury stock method. For purposes of this calculation, stock options, restricted stock units, warrants and shares of common stock underlying convertible notes are asconsidered ~~follows~~to (be common stock equivalents and are included in ~~thousands,~~the ~~except~~calculation of diluted net loss per share ~~amounts):~~only when their effect is dilutive.

	Three Months Ended June 30, 2025					Three Months Ended June 30, 2024					Six Months Ended June 30, 2025				Six Months Ended June 30, 2024
	Income			Shares		Income			Shares		Income		Shares		Income			Shares
Basic:
Net (loss) income	$	(2,381	)		154,020	$	(9,235	)		152,305	$	254		153,804	$	(12,395	)		151,900
(Loss) earnings per share, basic	$	(0.02	)			$	(0.06	)			$	0.00			$	(0.08	)
Diluted:
Net (loss) income	$	(2,381	)		154,020	$	(9,235	)		152,305	$	254		153,804	$	(12,395	)		151,900
Effect of dilutive securities:
Stock options outstanding		—			—		—			—		—		29,697		—			—
Restricted stock units outstanding		—			—		—			—		—		4,133		—			—
Warrants outstanding		—			—		—			—		—		298		—			—
Shares of common stock underlying convertible notes outstanding		—			—		—			—		—		9,819		—			—
Net (loss) income, diluted	$	(2,381	)		154,020	$	(9,235	)		152,305	$	254		197,751	$	(12,395	)		151,900
(Loss) earnings per share, diluted	$	(0.02	)			$	(0.06	)			$	0.00			$	(0.08	)

Because we have incurred a net loss for the three and nine months ended September 30, 2025 and 2024, the following common stock equivalents were not included in the computation of net loss per share because their effect would be anti-dilutive (in thousands):

Because we incurred a net loss for the three months ended June 30, 2025 and the three and six months ended June 30, 2024, the following common stock equivalents were not included in the computation of earnings per share because their effect would be anti-dilutive (in thousands):


	As of September 30,
	2025		2024
Stock options outstanding		28,888		26,156
Restricted stock units outstanding		4,014		1,547
Warrants outstanding		298		298
Shares of common stock underlying convertible notes outstanding		19,444		9,819
Series A Preferred Stock convertible to common shares		5,241		—

	June 30,
	2025		2024
Stock options outstanding		29,697		27,445
Restricted stock units outstanding		4,133		1,642
Warrants outstanding		298		298
Shares of common stock underlying convertible notes outstanding		9,819		9,819

Segment Reporting

Management, upon consideration of the organizational structure of the business and information reviewed by the Company's Chief Executive Officer, who is also the Company's chief operating decision maker ("CODM"), has concluded that we have one reportable segment. All revenues for the three and ~~six~~nine months ended ~~June~~September 30, 2025 and 2024 were generated from customers in the U.S. The CODM allocates resources and evaluates the performance of the reportable segment, which is the consolidated entity, primarily based on net (loss) ~~income~~ as reported on the consolidated statements of operations and comprehensive (loss~~) income~~ . The significant expenses reviewed by the CODM are cost of product sales, research and development expenses, general and administrative expenses, and sales and marketing expenses as reported on the consolidated statements of operations and comprehensive (loss~~) income~~. The Company's operating segments do not record intercompany revenue nor allocate any expenses. The CODM does not evaluate operating segments using discrete asset information.

14Recently Adopted Accounting Standards

~~Recent~~In ~~Accounting~~November ~~Pronouncements~~2024, the FASB issued ASU No. 2024-04, Induced Conversions of Convertible Debt Instruments ("ASU 2024-04"), to improve the consistency in application of the induced conversion guidance in Subtopic 470-20, Debt - Debt with Conversions and Other Options. We early adopted the provisions of ASU 2024-04 in the three months ended September 30, 2025 and concluded that the settlement of the 2026 Convertible Notes did not represent an induced conversion. Refer to Note 8 - Long-Term Debt and Convertible Notes for evaluation of the accounting of the transaction.

Recently Issued Accounting Standards Not Yet Adopted

From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that we adopt as of the specified effective date. We have evaluated recently issued accounting pronouncements and do not believe any will have a material impact on our condensed consolidated financial statements or related financial statement disclosures.

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"), to enhance income tax reporting disclosures and require disclosure of specific categories in the tabular rate reconciliation. ASU 2023-09 is effective for annual periods beginning after December 15, 2024, on a prospective basis. Early adoption and retrospective application are permitted. We are currently evaluating the impact on our disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses ("ASU 2024-03"), which requires disaggregated disclosures of certain categories of expenses that are included in the face of the financial statements. This standard is effective for fiscal years beginning after December 15, 2026 and interim periods beginning after December 15, 2027. Early adoption is permitted. We are currently evaluating the impact on our disclosures.

4. Fair Value Measurements

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The FASB ASC Topic 820, Fair Value Measurements and Disclosures, establishes a fair value hierarchy which prioritizes the inputs used in measuring fair value as follows:

•

Level 1—Observable inputs such as 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.

We measure cash, cash equivalents and short-term investments at fair value on a recurring basis. The fair values of such assets were as follows (in thousands):

			Fair Value Measurements at Reporting Date Using
	Balance atJune 30,2025		Quoted Pricesin ActiveMarkets forIdenticalAssets(Level 1)		SignificantOtherObservableInputs(Level 2)		SignificantUnobservableInputs(Level 3)
	Balance atSeptember 30,2025		Quoted Pricesin ActiveMarkets forIdenticalAssets(Level 1)		SignificantOtherObservableInputs(Level 2)		SignificantUnobservableInputs(Level 3)
Cash and money market funds	$	1336,~~954~~397	$	1336,~~954~~397	$	—	$	—
U.S. Treasury bills and government agency obligations		146,~~655~~732		146,~~655~~732		—		—
U.S. corporate debt securities		65,~~451~~018		—		65,~~451~~018		—
Foreign corporate debt securities		2,899		—		2,899		—
Foreign commercial paper		6,551		—		6,551		—
Foreign commercial paper		1,979		—		1,979		—
U.S. commercial paper		789		—		789		—
U.S. commercial paper		695		—		695		—
Total	$	55,487	$	43,129	$	12,358	$	—
Total	$	40,633	$	28,609	$	12,024	$	—


			Fair Value Measurements at Reporting Date Using
	Balance at December 31, 2024		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Cash and money market funds	$	23,860	$	23,860	$	—	$	—
U.S. Treasury bills and government agency obligations		14,868		14,868		—		—
U.S. corporate debt securities		13,644		—		13,644		—
Foreign corporate debt securities		5,913		—		5,913		—
Foreign commercial paper		998		—		998		—
Total	$	59,283	$	38,728	$	20,555	$	—

We have not transferred any investment securities between the three levels of the fair value hierarchy for the three and ~~six~~nine months ended ~~June~~September 30, 2025 or 2024.

As of June 30, 2025, cash equivalents included $2.6 million of available-for-sale securities with contractual maturities of three months or less and short-term investments included $6.2 million of available-for-sale securities with contractual maturities of three months to one year. As of December 31, 2024, cash equivalents included $1.9 million of available-for-sale securities with contractual maturities of three months or less and short-term investments included $9.0 million of available-for-sale securities with contractual maturities of three months to one year. The money market funds as of June 30, 2025 and December 31, 2024 are included in cash and cash equivalents on the condensed consolidated balance sheets.15

As of September 30, 2025, cash equivalents included $16.9 million of available-for-sale securities with contractual maturities of three months or less and short-term investments included $5.3 million of available-for-sale securities with contractual maturities of three months to one year. As of December 31, 2024, cash equivalents included $1.9 million of available-for-sale securities with contractual maturities of three months or less and short-term investments included $9.0 million of available-for-sale securities with contractual maturities of three months to one year. The money market funds as of September 30, 2025 and December 31, 2024 are included in cash and cash equivalents on the condensed consolidated balance sheets.

A company may elect to use fair value to measure accounts receivable, available-for-sale securities, accounts payable, guarantees and issued debt, among others. If the use of fair value is elected, any upfront costs and fees related to the item such as debt issuance costs must be recognized in earnings and cannot be deferred. The fair value election is irrevocable and generally made on an instrument-by-instrument basis, even if a company has similar instruments that it elects not to measure based on fair value. Unrealized gains and losses on existing items for which fair value has been elected are reported as a cumulative adjustment to beginning retained earnings and any changes in fair value are recognized in earnings. We have elected to not apply the fair value option to our financial assets and liabilities.

Financial instruments, including cash, cash equivalents, receivables, inventory, prepaid expenses, other current assets, accounts payable and accrued expenses are carried at cost, which is considered to be representative of their respective fair values because of the short-term maturity of these instruments. Short-term available-for-sale investments are carried at fair value. Our notes payable and convertible notes payable outstanding at ~~June~~September 30, 2025 and December 31, 2024 do not have a readily available ascertainable market value; however, their carrying value, which is measured at carrying value less unamortized debt issuance costs and debt discounts, is considered to approximate their fair value.

5. Short-Term Investments

The following is a summary of our short-term investments (in thousands):

	June 30, 2025
	September 30, 2025
			Gross		Gross
	Amortized		Unrealized		Unrealized			Estimated
	Cost		Gains		Losses			Fair Value
U.S. Treasury bills and government agency obligations	$	143,~~656~~742	$	—	$	(1—	)	$	143,~~655~~742
U.S. corporate debt securities		4,~~969~~519		1—		—			4,~~970~~519
Foreign corporate debt securities		1,817		1		—			1,818
U.S. commercial paper		789		—		—			789
U.S. commercial paper		696		—		(1	)		695
Foreign commercial paper		3,369		—		—			3,369
Foreign commercial paper		1,980		—		(1	)		1,979
Total	$	12,419	$	—	$	—		$	12,419
Total	$	24,118	$	2	$	(3	)	$	24,117


	December 31, 2024
			Gross		Gross
	Amortized		Unrealized		Unrealized		Estimated
	Cost		Gains		Losses		Fair Value
U.S. Treasury bills and government agency obligations	$	14,860	$	8	$	—	$	14,868
U.S. corporate debt securities		11,699		3		—		11,702
Foreign corporate debt securities		5,911		2		—		5,913
Foreign commercial paper		998		—		—		998
Total	$	33,468	$	13	$	—	$	33,481

The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity. We regularly monitor and evaluate the realizable value of our marketable securities. We did not recognize any impairment losses during the three and ~~six~~nine months ended ~~June~~September 30, 2025 and 2024.

Unrealized gains and losses associated with our investments are reported in accumulated other comprehensive (loss~~) income~~. Realized gains and losses associated with our investments, if any, are reported in the statements of operations and comprehensive (loss~~) income~~. We did not recognize any realized gains or losses during the three and ~~six~~nine months ended ~~June~~September 30, 2025 and 2024.

6. Inventory

Inventory consists of the following (in thousands):

	June 30, 2025		December 31, 2024
	September 30, 2025		December 31, 2024
Raw materials	$	3532,~~817~~785	$	19,733
Work in process		26,~~145~~343		27,190
Finished goods		1110,~~003~~897		6,237
Total inventory	$	7270,~~965~~025	$	53,160

As of June 30, 2025, total inventory included $34.5 million related to CINVANTI, $31.7 million related to ZYNRELEF, $3.0 million related to SUSTOL and $3.8 million related to APONVIE. As of December 31, 2024, total inventory included $36.6 million related to CINVANTI, $11.8 million related to ZYNRELEF, $3.2 million related to SUSTOL and $1.6 million for APONVIE.


	September 30, 2025		December 31, 2024
CINVANTI	$	30,434	$	36,484
SUSTOL		1,477		3,206
APONVIE		5,427		1,626
ZYNRELEF		32,687		11,844
Total inventory	$	70,025	$	53,160

For the three and ~~six~~nine months ended ~~June~~September 30, 2025, cost of product sales included charges of $02.52 million and $2.7 million, respectively relating to reserves and write-offs of inventory. For the three and ~~six~~nine months ended ~~June~~September 30, 2024, cost of product sales included charges of $10.68 million and $2.4 million, respectively, relating to ~~the~~reserves and write-~~off~~offs of inventory.

7. Leases

As of ~~June~~September 30, 2025, we had an operating lease for 52,148 square feet of laboratory and office space in San Diego, California, with a lease term that expires on December 31, 2025. In October 2021, we entered into a sublease agreement to sublet 23,873 square feet of laboratory and office space in San Diego, California. The space was delivered to the subtenant in March 2022. As a result of the sublease agreement, our one five-year option to renew this lease on expiration applies only with respect to our remaining 28,275 square feet of laboratory and office space. In August 2025, we entered into a lease agreement for 16,837 square feet of office space in Cary, North Carolina, with the lease term expected to commence no later than May 25, 2026 (“lease commencement date”) and expire 111 months from the lease commencement date, with the option to extend for one additional period of 84 months upon written notice. As the lease commencement date has not yet occurred, no right-of-use asset or lease liability has been recognized in the accompanying condensed consolidated financial statements. We provided the landlord with a letter of credit for $0.2 million, which is included within cash and cash equivalents in the condensed consolidate balance sheet.

WeDuring ~~have~~the athree ~~short-term~~and ~~sublease~~nine ~~agreement~~months toended ~~sublet~~September 930,~~882~~ ~~square~~2025, ~~feet~~we ofrecognized ~~office~~$0.8 ~~space~~million inand ~~Cary,~~$2.3 ~~North~~million ~~Carolina~~of operating lease expense, ~~with~~respectively. aDuring ~~lease~~the ~~term~~three ~~that~~and ~~expires~~nine onmonths ~~August~~ended 31September 30, 2025, we paid $0.8 million and $2.4 million, respectively, for our operating leases.

During the three and ~~six~~nine months ended ~~June~~September 30, ~~2025~~2024, we recognized $0.87 million and $12.62 million of operating lease expense, respectively. During the three and ~~six~~nine months ended ~~June~~September 30, ~~2025~~2024, we paid $0.8 million and $12.64 million, respectively, for our operating leases.

~~During~~Annual ~~the~~future ~~three~~minimum ~~and~~lease ~~six~~payments ~~months~~as ~~ended June 30, 2024, we recognized $0.7 million and $1.5 million~~ of ~~operating~~September ~~lease expense, respectively. During the three and six months ended June~~ 30, ~~2024,~~2025 weare ~~paid~~as ~~$0.8~~follows ~~million~~(in ~~and $1.6 million, respectively, for our operating leases.~~thousands):


2025	$	785
Less: discount		(5	)
Total lease liabilities	$	780

Annual future minimum lease payments as of June 30, 2025 are as follows (in thousands):

2025	$	1,563
Less: discount		(24	)
Total lease liabilities	$	1,539

8. Long-Term Debt and Convertible Notes

Working Capital Facility Agreement

On August 9, 2023, we entered into a working capital facility agreement (the "Initial Working Capital Facility Agreement") with Hercules Capital, Inc., as administrative agent, ~~and~~ collateral agent, and ~~the~~lender ~~lenders party thereto~~ (the ~~"Lenders"~~“Lender”). The Initial Working Capital Facility Agreement ~~provides~~provided for an aggregate principal amount of up to $50.0 million with tranched availability as follows: (i) $25.0 million at closing on August 9, 2023 ("tranche 1A"), (ii) $5.0 million available through December 15, 2024 ("tranche 1B"), and (iii) $20.0 million available from the earlier of: (1a) the full draw of tranche 1B and (2b) the expiration of tranche 1B, and available through December 15, 2025 ("tranche 1C"), and in the case of tranches 1B and 1C, subject to certain customary conditions to draw down. ~~As of June 30, 2025, we have only drawn tranche 1A.~~

The Initial Working Capital Facility Agreement ~~has~~had a term of four years, with a springing maturity date that iswas 91 days prior to the stated maturity of our ~~Senior~~2026 Convertible Notes (as defined ~~and later amended~~ below), (if still outstanding at such time). The loans thereunder dodid not have any scheduled amortization payments and ~~accrue~~accrued interest at a floating rate equal to, 9.95% per annum, payable in cash on a monthly basis and upon maturity or payoff. In addition, ~~under~~any ~~the~~loans ~~terms~~under of the Initial Working Capital Facility Agreement, ~~the loans~~ also ~~accrue~~accrued paid-in-kind interest at a fixed- rate of 1.5% per annum which iswas due upon maturity or payoff.

In addition, in connection with the tranche 1A funding, we issued warrants to the ~~Lenders~~Lender to purchase up to 297,619 shares of our common stock at an exercise price of $1.68 per share (the "Lender Warrants"). The Lender Warrants are equal to 2.00% of the principal amount of the tranche 1A loans funded by the ~~Lenders~~Lender (the "Warrant Coverage"). The Initial Working Capital Facility Agreement also ~~requires~~required that we issue additional warrants to the ~~Lenders~~Lender at the time of each draw down of tranches 1B and 1C with the same Warrant Coverage. Each Lender Warrant is exercisable for seven years from the date of issuance. The Lender Warrant issued in conjunction with the tranche 1A funding remains outstanding at September 30, 2025.

~~The~~On ~~Working~~February ~~Capital~~13, ~~Facility~~2025, ~~Agreement~~we ~~contains~~entered ainto ~~minimum~~an ~~cash~~amendment ~~covenant,~~to ~~beginning~~the onInitial ~~the~~Working ~~closing~~Capital ~~date,~~Facility ~~requiring~~Agreement us(the “First Amendment to ~~hold~~the ~~cash~~Working ofCapital noFacility ~~less~~Agreement”) ~~than~~to ~~$8.5~~extend ~~million,~~the ifmaturity ~~our~~date ~~market~~to ~~capitalization~~the isearlier ~~less~~of ~~than~~(a) ~~$400.0~~September ~~million.~~1, ~~The~~2027 ~~Working~~and ~~Capital~~(b) ~~Facility~~to ~~Agreement~~the ~~also~~extent ~~contains~~that ~~customary~~any ~~representations~~of ~~and~~the ~~warranties~~2026 ~~and~~Convertible ~~customary~~Notes ~~affirmative~~remain ~~and~~outstanding ~~negative~~on ~~covenants,~~such ~~including~~date, ~~among~~(i) ~~other~~May ~~things~~12, ~~restrictions~~2026 onor ~~indebtedness,~~(ii) ~~liens,~~in ~~investments,~~the ~~mergers,~~event ~~dispositions,~~that ~~prepayment~~the maturity date of ~~other~~any ~~indebtedness~~2026 Convertible Notes is extended, ~~and~~prior ~~dividends~~to ~~and~~May ~~other~~12, ~~distributions~~2026, ~~subject~~ to ~~certain~~August ~~exceptions.~~11, We2026, ~~were~~or inlater, ~~compliance~~the ~~with~~date ~~all~~that ~~covenants~~is of91 ~~the~~days ~~Working~~prior ~~Capital~~to ~~Facility~~the ~~Agreement~~maturity asdate of ~~June~~such ~~30,~~further ~~2025~~extended 2026 Convertible Notes.

On ~~February~~August 138, 2025, we entered into an amendment to the Initial Working Capital Facility Agreement, ~~was~~as amended by the First Amendment to ~~extend~~the Working Capital Facility Agreement (the ~~maturity~~“Second ~~date~~Amendment to the ~~earlier~~Working ofCapital (aFacility Agreement”). ~~September~~The 1,Second ~~2027~~Amendment ~~and~~to the Working Capital Facility Agreement (bi) provides for an aggregate principal amount of up to $150.0 million plus the ~~extent~~accrued ~~that~~and ~~any~~unpaid ofpaid-in-kind interest on the ~~Senior~~existing ~~Convertible~~debt ~~Notes~~under ~~remain~~the ~~outstanding~~Initial Working Capital Facility Agreement at closing on ~~such~~August 12, 2025, (ii) extends the maturity date under the First Amendment to the Working Capital Facility Agreement to September 1, 2030, (iiii) ~~May~~adjusts 12the interest rate to Prime, ~~2026~~with ora 7.5% floor, plus 1.95%, (iiiv) inadjusts the ~~event~~paid-in-kind ~~that~~interest ~~the~~rate to 1.0% per annum, which is due upon maturity ~~date~~or payoff, (iv) provides for payment of ~~any~~a ~~Senior~~1.0% ~~Convertible~~upfront ~~Notes~~facility ischarge ~~extended,~~and ~~prior~~an end of term charge of up to ~~May~~6.25% ~~12,~~of ~~2026,~~principal drawn. The loans under the Second Amendment to the Working Capital Facility Agreement do not have any scheduled amortization payments. The approximately $150.0 million aggregate principal has tranched availability as follows: (i) $110.0 million plus capitalized paid-in-kind interest of approximately $0.8 million on August 1112, ~~2026~~2025 (“tranche 1”), or(ii) ~~later~~$20.0 million available through December 15, ~~the~~2026 ~~date~~(“tranche ~~that~~2”) isand 91(iii) ~~days~~$20.0 ~~prior~~million toavailable from the ~~maturity~~earlier ~~date~~of: (a) the full draw of ~~such~~tranche ~~further~~2 ~~extended~~and ~~Senior~~(b) ~~Convertible~~September ~~Notes~~30, 2027 (“tranche 3”), and in the case of tranches 2 and 3, subject to certain customary conditions to draw down.

The Second Amendment to the Working Capital Facility Agreement ~~was~~contains ~~accounted~~a ~~for~~minimum incash ~~accordance with ASC Topic 470~~covenant, ~~Debt,~~a ~~ASC~~minimum ~~Topic~~revenue ~~480,~~covenant ~~Distinguishing Liabilities from Equity,~~ and ~~ASC~~a ~~Topic~~minimum ~~815,~~EBITDA ~~Derivatives and Hedging~~covenant. The ~~initial~~Second ~~tranche~~Amendment 1Ato ~~funding~~the ofWorking ~~$25.0~~Capital ~~million~~Facility ~~and~~Agreement ~~the~~contains ~~Lender~~customary ~~Warrants~~representations ~~are~~and ~~accounted~~warranties ~~for~~and ascustomary ~~freestanding~~affirmative ~~debt~~ and ~~equity~~negative ~~financial instruments~~covenants, ~~respectively~~including, asamong ~~they~~other ~~are~~things, ~~legally~~restrictions ~~detachable~~on ~~and~~indebtedness, ~~separately~~liens, ~~exercisable.~~investments, ~~The~~mergers, ~~additional~~dispositions, ~~borrowings~~prepayment ~~available~~of ~~under~~other ~~the~~indebtedness, ~~Working~~and ~~Capital~~dividends ~~Facility~~and ~~Agreement~~other ~~plus~~distributions, ~~the~~subject ~~additional warrants~~ to ~~purchase~~certain ~~shares~~exceptions. ofWe ~~our~~were ~~common~~in ~~stock,~~compliance ~~which~~with ~~would~~all becovenants ~~issued~~of ~~concurrently,~~the ~~are~~Second ~~accounted~~Amendment ~~for~~to asthe aWorking ~~single~~Capital ~~freestanding~~Facility ~~financial~~Agreement ~~instrument~~as ~~that~~of ~~are~~September ~~not~~30, ~~assets~~2025. orThe ~~obligations~~Initial ofWorking ~~ours;~~Capital ~~this~~Facility ~~financial~~Agreement, ~~instrument~~together ~~meets~~with the ~~loan~~First ~~commitment~~Amendment ~~derivative~~to ~~scope~~the ~~exception~~Working ~~and~~Capital ~~will~~Facility beAgreement ~~accounted for when~~ and ifthe weSecond ~~borrow~~Amendment ~~additional~~to ~~tranches in~~ the ~~future.~~Working ~~The~~Capital ~~initial~~Facility ~~funding~~Agreement ofare ~~$25.0~~referred ~~million~~to ~~was recorded~~ as ~~a liability on~~ the ~~condensed~~“Working ~~consolidated~~Capital ~~balance~~Facility ~~sheets~~Agreement”.

InThe ~~connection~~Second ~~with~~Amendment to the Working Capital Facility Agreement, wewas ~~recognized~~accounted ~~the~~for ~~initial~~in ~~Lender~~accordance ~~Warrants~~with atASC ~~their~~Topic ~~relative~~470, ~~fair value of $0~~Debt.4 ~~million,~~Amendments ~~and~~are weassessed ~~incurred~~by ~~debt~~management ~~issuance~~to ~~costs~~determine ofappropriate ~~$0.6~~treatment ~~million, both of which were recorded~~ as troubled debt ~~discounts.~~restructurings, ~~The~~extinguishments ~~debt~~

~~discounts~~or modifications. The Second Amendment to the Working Capital Facility Agreement qualifies as a debt extinguishment and issuance of a new debt instrument. We recorded a loss on extinguishment during the ~~end~~quarter ended September 30, 2025, of ~~term~~$5.5 ~~fee~~million, equal to the carrying value of the Second Amendment to the Working Capital Facility Agreement less the carrying value of the First Working Capital Facility Agreement on August 12, 2025 of $0.83 million, ~~are~~the ~~being~~facility ~~amortized~~charge ~~and~~of ~~accreted~~$1.1 ~~into~~million ~~interest~~paid ~~expense~~to ~~using~~the lenders, the ~~effective~~remaining ~~interest~~Initial ~~rate~~Working ~~method~~Capital ~~over~~Facility ~~the~~Agreement end of term fee of $0.2 million and the present value of Second Amendment to the Working Capital Facility Agreement end of term fee of $3.9 million. The ~~effective~~Initial ~~interest~~Working ~~rate~~Capital asFacility Agreement end of ~~June~~term 30fee is payable on September 1, ~~2025~~2027. isThe 13remaining Second Amendment to the Working Capital Facility Agreement end of term fee will be accreted to interest expense over the term of the agreement using the effective interest rate method.~~8%.~~

~~For~~The ~~the~~tranche ~~three~~1 ~~and~~funding ~~six~~under ~~months~~the ~~ended~~Second ~~June~~Amendment ~~30, 2025, interest expense related~~ to the Working Capital Facility Agreement ~~was~~of $0110.90 million ~~and~~plus ~~$1.8~~the ~~million,~~accrued ~~respectively,~~and ~~which~~unpaid ~~included~~paid-in-kind interest of $0.67 million ~~and~~from ~~$1.3~~the ~~million,~~Initial ~~respectively,~~Working ~~related~~Capital toFacility ~~the~~Agreement ~~stated~~are ~~interest~~accounted ~~rate,~~for ~~$0.1~~as ~~million~~debt and ~~$0.2~~was ~~million,~~recorded ~~respectively,~~as ~~related~~a toliability ~~paid-in-kind~~on ~~interest,~~the ~~and~~condensed ~~$0.2~~consolidated ~~million~~balance ~~and $0~~sheets.3 ~~million,~~In ~~respectively~~addition, ~~related~~the additional borrowings available under the Second Amendment to the ~~amortization~~Working Capital Facility Agreement are accounted for as a single freestanding financial instrument that are not assets or obligations of ~~the~~ours ~~debt~~and ~~discounts~~will be accounted for when and ~~accretion~~if ofwe ~~the~~borrow ~~end~~additional oftranches ~~term~~in ~~fee.~~the future.

~~For~~In connection with the ~~three~~Second ~~and~~Amendment ~~six~~to ~~months~~the ~~ended~~Working ~~June~~Capital ~~30,~~Facility ~~2024~~Agreement, ~~interest~~we ~~expense~~incurred ~~related~~debt toissuance ~~the~~costs ~~Loan~~of ~~Agreement was~~ $03.95 million, ~~and~~which ~~$1.8~~was ~~million,~~recorded ~~respectively,~~as ~~which~~a ~~included~~debt $0discount.7 ~~million~~The ~~and~~debt ~~$1.3~~discount ~~million,~~is ~~respectively,~~being ~~related~~amortized tointo interest expense using the ~~stated~~effective interest rate, ~~$0.1~~method ~~million~~over ~~and~~the ~~$0.2~~term ~~million,~~of ~~respectively,~~the ~~related~~Second Amendment to ~~paid-in-kind~~the ~~interest,~~Working ~~and~~Capital ~~$0.1~~Facility ~~million and $0~~Agreement.3 ~~million,~~The ~~respectively,~~effective ~~related~~interest torate ~~the~~as ~~amortization~~ of ~~the~~September ~~debt~~30, ~~discounts.~~2025 is 11.6%.

AsFor ofthe ~~June~~three and nine months ended September 30, 2025, ~~the~~interest ~~carrying~~expense ~~value~~related ofto ~~tranche~~the 1AWorking Capital Facility Agreement was $252.2 million and $4.0 million, respectively, which isincluded ~~comprised~~$1.7 ofmillion ~~the~~and $253.0 million, ~~principal~~respectively, ~~amount~~related ~~outstanding~~to the stated interest rate, $0.72 million ofand ~~accumulated~~$0.4 million, respectively, related to paid-in-kind interest, ~~less~~and ~~debt~~$0.2 ~~discounts~~million ofand $0.36 million., ~~The~~respectively, ~~end~~related ofto ~~term~~the ~~fee~~amortization ~~accreted~~of asthe ofdebt ~~June~~discounts ~~30,~~and ~~2025~~accretion of ~~$0.5 million is recorded in other non-current liabilities on~~ the ~~condensed~~end ~~consolidated~~of ~~balance~~term ~~sheets~~fee.

~~Senior~~For ~~Unsecured~~the ~~Convertible~~three ~~Notes~~and nine months ended September 30, 2024, interest expense related to the Working Capital Facility Agreement was $0.9 million and $2.7 million, respectively, which included $0.6 million and $1.9 million, respectively, related to the stated interest rate, $0.1 million and $0.3 million, respectively, related to paid-in-kind interest, and $0.2 million and $0.5 million, respectively, related to the amortization of the debt discounts.

InAs ~~May~~of ~~2021~~September 30, we2025, ~~entered~~the ~~into~~carrying avalue ~~note~~of ~~purchase~~the ~~agreement~~Working ~~with~~Capital ~~funds~~Facility ~~affiliated~~Agreement ~~with~~was ~~Baker Bros~~$107.5 ~~Advisors~~million, LPwhich ~~for~~is acomprised ~~private placement~~ of the $~~150~~110.08 million inprincipal ~~Senior~~amount ~~Unsecured~~outstanding, ~~Convertible~~$0.1 ~~Notes~~million ~~(the~~of ~~"Senior~~accumulated ~~Convertible~~paid-in-kind ~~Notes").~~interest, Weless ~~received~~debt adiscounts ~~total~~ of $~~149~~3.04 million,. ~~net~~The end of ~~issuance~~term ~~costs,~~fee ~~from~~accreted ~~the~~as ~~issuance~~of September 30, 2025, of $4.7 million is recorded in other non-current liabilities on the ~~Senior~~condensed ~~Convertible~~consolidated ~~Notes~~balance sheets.

~~The~~2026 Senior ~~Convertible~~Unsecured ~~Notes were issued at par. The Senior~~ Convertible Notes bear interest at a rate of 1.5% per annum, payable in cash semi-annually in arrears on June 15 and December 15 of each year. The Senior Convertible Notes mature on May 26, 2026, unless earlier converted, redeemed or repurchased.

~~The~~In ~~Senior Convertible Notes were subject to redemption at our option, between~~ May 242021, ~~2024~~we ~~and~~entered ~~May~~into ~~24,~~a ~~2025,~~note ~~but~~purchase ~~only~~agreement ifwith ~~the~~funds ~~last~~affiliated ~~reported~~with ~~sale~~Baker ~~price~~Bros. ~~per~~Advisors ~~share~~LP ~~of our common stock exceeded 250% of the conversion price~~ for a ~~specified~~private ~~period~~placement of ~~time,~~$150.0 ormillion isaggregate ~~subject~~principal toamount ~~redemption~~of atsenior ~~our~~unsecured ~~option~~convertible onnotes ordue ~~after~~2026 ~~May 24, 2025 if~~ (the ~~last~~“2026 ~~reported~~Convertible ~~sale~~Notes”). ~~price~~We ~~per~~received ~~share of our common stock exceeds 200% of the conversion price for~~ a ~~specified~~total ~~period~~ of ~~time~~$149.0 ~~The~~million, ~~redemption~~net ~~price~~of ~~will~~issuance becosts, ~~equal~~from to the ~~principal~~issuance ~~amount~~ of the ~~Senior~~2026 Convertible Notes ~~to be redeemed, plus accrued and unpaid interest~~.

~~Upon~~The ~~conversion,~~2026 ~~we will settle the Senior~~ Convertible Notes inbear ~~shares~~interest ofat ~~our~~a ~~common~~rate ~~stock~~of 1.5% ~~The~~per ~~initial~~annum, ~~conversion~~payable ~~rate~~in ~~for~~cash ~~the~~semi-annually ~~Senior~~in ~~Convertible~~arrears ~~Notes~~on isJune ~~65.4620~~15 ~~shares~~and ~~per~~December ~~$1,000~~15 ~~principal amount~~ of ~~the~~each ~~Senior~~year ~~Convertible~~with ~~Notes~~a ~~(equivalent~~maturity todate anof ~~initial~~May ~~conversion~~26, ~~price~~2026, ofunless ~~$15.276~~earlier ~~per~~converted, ~~share~~redeemed ofor ~~common stock)~~repurchased.

IfThe a2026 ~~holder~~Convertible Notes were accounted for in accordance with ASC Subtopic 470-20, Debt with Conversion and Other Options (“ASC 470-20”), and ASC Subtopic 815-40, Contracts in Entity's Own Equity (“ASC 815-40”). Under ASC 815-40, to qualify for equity classification (or non-bifurcation, if embedded), the instrument (or embedded feature) must be both (1) indexed to the issuer's stock and (2) meet the requirements of the ~~Senior~~equity classification guidance. Based upon our analysis, it was determined that the 2026 Convertible Notes ~~converts~~do ~~upon~~contain aembedded ~~make-whole~~features ~~fundamental~~indexed ~~change~~to orour ~~company~~common ~~redemption~~stock, but do not meet the ~~holder~~requirements ~~may~~for bebifurcation, ~~eligible~~and therefore do not need to ~~receive~~be aseparately ~~make-whole~~accounted ~~premium~~for ~~through~~as an ~~increase~~equity tocomponent. Since the embedded conversion ~~rate~~feature meets the equity scope exception from derivative accounting, and, also since the embedded conversion option does not need to be separately accounted for as an equity component under ASC 470-20, the proceeds received from the issuance of the 2026 Convertible Notes were recorded as a liability on the condensed consolidated balance sheets.

InWe ~~May~~incurred ~~2021,~~issuance wecosts ~~filed~~related ato ~~registration~~the ~~statement~~2026 ~~with~~Convertible ~~the~~Notes ~~SEC~~of to$1.0 ~~register~~million, ~~for~~which ~~resale~~we ~~12.4~~recorded ~~million~~as ~~shares~~debt ofissuance ~~our~~costs ~~common~~and ~~stock~~were ~~underlying~~included as a reduction to the ~~Senior~~2026 Convertible Notes, ~~including~~on the ~~maximum~~condensed ~~number~~consolidated ofbalance ~~shares~~sheets. ofThe ~~common~~debt ~~stock~~issuance ~~issuable~~costs ~~under~~are ~~the make-whole premium.~~

The Senior Convertible Notes were accounted for in accordance with ASC Subtopic 470-20, Debt with Conversion and Other Options ("ASC 470-20"), and ASC Subtopic 815-40, Contracts in Entity's Own Equity ("ASC 815-40"). Under ASC 815-40, to qualify for equity classification (or non-bifurcation, if embedded), the instrument (or embedded feature) must be both (1) indexed to the issuer's stock and (2) meet the requirements of the equity classification guidance. Based upon our analysis, it was determined that the Senior Convertible Notes do contain embedded features indexed to our common stock, but do not meet the requirements for bifurcation, and therefore do not need to be separately accounted for as an equity component. Since the embedded conversion feature meets the equity scope exception from derivative accounting, and, also since the embedded conversion option does not need to be separately accounted for as an equity component under ASC 470-20, the proceeds received from the issuance of the Senior Convertible Notes were recorded as a liability on the condensed consolidated balance sheets.

We incurred issuance costs related to the Senior Convertible Notes of $1.0 million, which we recorded as debt issuance costs and are included as a reduction to the Senior Convertible Notes on the condensed consolidated balance sheets. The debt issuance costs are being amortized to interest expense using the effective interest rate method over the term of the Senior Convertible Notes, resulting in an effective interest rate of 1.6%.

~~For~~being ~~the~~amortized ~~three~~to ~~and six months ended June 30, 2025,~~ interest expense ~~related~~using to the ~~Senior~~effective ~~Convertible~~interest ~~Notes~~rate ~~was~~method ~~$0.6~~over ~~million~~the ~~and~~term ~~$1.2~~of ~~million,~~the ~~respectively,~~2026 ~~which~~Convertible ~~included $0.5 million and $1.1 million~~Notes, ~~respectively,~~resulting ~~related~~in toan ~~the~~effective ~~stated~~ interest rate ~~and~~of ~~$0.~~1 ~~million and $0~~.~~1 million, respectively, related to the amortization of debt issuance costs~~6%.

~~For~~On ~~the~~August ~~three~~8, ~~and~~2025, ~~six~~we ~~months~~entered ~~ended~~into ~~June~~an ~~30,~~exchange ~~2024,~~agreement ~~interest~~pursuant ~~expense~~to ~~related~~which to$150.0 million aggregate principal amount of the ~~Senior~~2026 Convertible Notes ~~was~~outstanding ~~$0.5~~were ~~million~~exchanged ~~and~~for ~~$1.1~~(i) ~~million~~16, ~~respectively~~666,666 ~~which~~shares ~~included~~of common stock for an aggregate principal amount of $025.40 million of the 2026 Convertible Notes and (ii) the remaining $1125.0 million, ~~respectively,~~plus ~~related~~accrued toand unpaid interest under the ~~stated~~2026 ~~interest~~Convertible ~~rate~~Notes ~~and~~paid ~~$0.1~~in ~~million~~cash, and ~~$0.1~~which ~~million,~~closed ~~respectively,~~on ~~related~~August to12, ~~the~~2025. ~~amortization~~As of ~~debt~~September ~~issuance~~30, ~~costs.~~2025, no 2026 Convertible Notes remain outstanding.

AsThe exchange agreement was accounted for in accordance with ASC 470-20, after the adoption of ~~June~~ASU 2024-04, whereby we concluded that the exchange did not qualify as an induced conversion. Thus, we accounted for the exchange as a debt extinguishment. We recorded a loss on extinguishment during the quarter ended September 30, 2025 of $5.8 million, which was equal to the carrying value of the ~~Senior~~2026 Convertible Notes less the fair value of the consideration offered in the exchange. The fair value of the consideration offered in the exchange was determined to be $~~149~~125.80 million, ~~which~~for isthe ~~comprised~~cash ofconsideration ~~the~~and $~~150~~30.07 million ~~principal~~for ~~amount~~the common shares offered. The fair value of the ~~Senior~~common ~~Convertible~~stock ~~Notes~~exchanged ~~outstanding,~~was ~~less~~determined ~~debt~~using ~~issuance~~the ~~costs~~closing price of ~~$0.2~~the ~~million~~common stock on August 7, 2025.

~~August~~For the three and nine months ended September 30, 2025, ~~Refinancing~~interest expense related to the 2026 Convertible Notes was $0.4 million and $1.6 million, respectively, which included $0.4 million and $1.5 million, respectively, related to the stated interest rate and nil and $0.1 million, respectively, related to the amortization of debt issuance costs.

OnFor ~~August 8, 2025 (~~the ~~“Closing~~three ~~Date”),~~and wenine ~~entered~~months ~~into~~ended ~~the~~September ~~second amendment to the Working Capital Facility Agreement with Hercules Capital~~30, ~~Inc.~~2024, asinterest ~~administrative~~expense ~~agent,~~related ~~and~~to the ~~lenders~~2026 ~~party~~Convertible ~~thereto~~Notes ~~(the~~was ~~“Credit Facility”). The Credit Facility (a) increases the aggregate principal amount of terms loans of up to~~ $~~150.~~0.6 million ~~plus accrued~~ and ~~unpaid paid-in-kind interest on the existing debt, with tranched availability as follows:~~ $~~110~~1.08 million, ~~plus~~respectively, ~~accrued~~which ~~and~~included ~~unpaid paid-in-kind interest on the existing debt at closing (“tranche 1”),~~ $~~20.~~0.5 million ~~available through December 15, 2026 (“tranche 2”),~~ and $201.06 million ~~available from the earlier of: (i) the full draw of tranche 2 and (ii) September 30~~, ~~2027 (“tranche 3”)~~respectively, ~~and~~related ~~in the case of tranches 2 and 3, subject~~ to ~~certain customary conditions to draw down, (b) extends~~ the ~~maturity date under the Loan Agreement to the earlier of (i) September 1, 2030 and (ii) to the extent that we issue convertible indebtedness, the date 180 days prior to the~~ stated ~~maturity thereof, (c) to adjust the~~ interest rate toand ~~Prime (7~~$0.~~5% floor) plus~~ 1~~.95%~~ ~~cash~~million ~~interest~~ and 1$0.~~00%~~2 ~~paid-in-kind~~million, ~~interest~~respectively, ~~and~~related ~~(d)~~ to ~~provide for payment of a 1.00% upfront facility charge and an end of term charge of up to 6.25%, depending on~~ the ~~end~~amortization of ~~term.~~debt ~~The~~issuance ~~loans thereunder do not have any scheduled amortization payments~~costs.

Concurrently on the Closing Date, we entered into (i) a note purchase agreement with purchasers party thereto pursuant to which we issued and sold $35.0 million aggregate principal amount of 5.0% senior convertible notes due 2031, ~~(ii)~~Senior aUnsecured ~~securities~~Convertible purchase agreement with the purchasers party thereto pursuant to which we issued and sold 13,225,227 shares of common stock and 524,141 shares of Series A convertible preferred stock for aggregate gross proceeds of $29.7 million and (iii) an exchange agreement with the holders party thereto to convert $25.0 million of the 1.5% senior convertible notes into 16,666,666 shares of common stock and repay the remaining $125.0 million with borrowings under the Credit Facility (collectively, the “Concurrent Transactions” and together with the Credit Facility, the “Refinancing Transactions”).Notes

~~The~~On ~~proceeds~~August ~~from~~8, ~~the~~2025, ~~Refinancing~~we ~~Transactions~~entered ~~were~~into ~~used~~a tonote ~~retire~~purchase ~~the~~agreement 1with a fund affiliated with Rubric Capital Management LP, for a private placement of $35.5%0 million aggregate principal amount of senior unsecured convertible notes ~~and~~due 2031 (the ~~Working~~“2031 ~~Capital~~Convertible ~~Facility~~Notes”), ~~while~~which ~~also~~closed ~~providing~~on ~~additional~~August ~~working~~12, ~~capital~~2025. toWe ~~support~~received ~~our~~a ~~commercial~~total of $31.9 million, net of issuance costs and ~~development~~original ~~initiatives~~issuance discount, from the issuance of the 2031 Convertible Notes.

9The 2031 Convertible Notes were issued at par. ~~Equity~~The ~~Incentive~~2031 ~~Plan~~Convertible Notes bear interest at a rate of 5.0% per annum, payable in cash semi-annually in arrears on March 1 and September 1 of each year, or at a rate of 7.0% per annum for paid-in-kind interest prior to September 1, 2026. The 2031 Convertible Notes mature on March 1, 2031, unless earlier converted, redeemed or repurchased.

~~Option~~The ~~Plan~~2031 ~~Activity~~Convertible Notes are subject to redemption at our option, after September 1, 2026, but only if the last reported sale price per share of our common stock exceeds 200% of the conversion price for a specified period of time. The redemption price will be equal to the principal amount of the 2031 Convertible Notes to be redeemed, plus accrued and unpaid interest.

The ~~following~~2031 ~~table~~Convertible ~~summarizes~~Notes ~~the~~can be settled in either shares of common stock, ~~option~~cash ~~activity~~or a combination of cash and shares of common stock based on the conversion rate in effect on the date of conversion. The initial conversion rate for the ~~six~~2031 ~~months~~Convertible ~~ended~~Notes ~~June~~is 30555.5556 shares per $1,000 ~~2025:~~principal amount of the 2031 Convertible Notes (equivalent to an initial conversion price of $1.80 per share of common stock), subject to certain adjustments.

	Shares(in thousands)			Weighted-AverageExercise Price		Weighted-AverageRemainingContractualTerm (Years)
Outstanding at December 31, 2024		26,082		$	4.46		7.80
Granted		6,061		$	1.85
Exercised		(278	)	$	1.47
Expired and forfeited		(2,168	)	$	10.31
Outstanding at June 30, 2025		29,697		$	3.53		7.90

If a holder of the 2031 Convertible Notes converts upon a make-whole fundamental change or Company redemption, the holder may be eligible to receive a make-whole premium through an increase to the conversion rate.

The 19,444,444 shares of common stock issuable upon the conversion, at the option of the holder, of the 2031 Convertible Notes, which includes the maximum number of shares of common stock issuable under the make-whole premium, are registered for resale pursuant to a registration statement filed with and declared effective by the SEC in September 2025.

At a special meeting of stockholders held on October 13, 2025, the Company’s stockholders approved, pursuant to Nasdaq Listing Rule 5635(d), the issuance of shares of common stock in connection with the conversion of the 2031 Convertible Notes, which could, under certain circumstances that may occur in the future, exceed 19.99% of the number of shares of the common stock issued and outstanding prior to such issuance.

The 2031 Convertible Notes were accounted for in accordance with ASC 470-20 and ASC 815-40. Under ASC 815-40, to qualify for equity classification (or non-bifurcation, if embedded), the instrument (or embedded feature) must be both (1) indexed to the issuer's stock and (2) meet the requirements of the equity classification guidance. Based upon our analysis, it was determined that the 2031 Convertible Notes do contain embedded features indexed to our common stock, but do not meet the requirements for bifurcation, and therefore do not need to be separately accounted for as an equity component. Since the embedded conversion feature meets the equity scope exception from derivative accounting, and, also since the embedded conversion option does not need to be separately accounted for as an equity component under ASC 470-20, the proceeds received from the issuance of the 2031 Convertible Notes were recorded as a liability on the condensed consolidated balance sheets.

We incurred issuance costs related to the 2031 Convertible Notes of $1.4 million, which we recorded as debt issuance costs and are included as a reduction to the 2031 Convertible Notes on the condensed consolidated balance sheets. We also incurred an original issuance discount of $1.75 million, which we recorded as a reduction to the 2031 Convertible Notes on the condensed consolidated balance sheets. The debt issuance costs and original issuance discount are being amortized to interest expense using the effective interest rate method over the term of the 2031 Convertible Notes, resulting in an effective interest rate of 7.16%.

For the three and nine months ended September 30, 2025, interest expense related to the 2031 Convertible Notes was $0.3 million, respectively, which included $0.3 million, related to paid-in-kind interest and nil, related to the amortization of debt issuance costs.

As of September 30, 2025, the carrying value of the 2031 Convertible Notes was $32.2 million, which is comprised of the $35.0 million principal amount of the 2031 Convertible Notes outstanding, $0.3 million of accumulated paid-in-kind interest, less debt issuance costs of $3.1 million.

9. Private Placement Equity Offering

On August 8, 2025, we entered into a securities purchase agreement with the purchasers, for a private placement of (i) 13,225,227 shares of common stock at a purchase price of $1.50 per share and (ii) 524,141 shares of Series A convertible preferred stock, which would automatically convert upon stockholder approval into 5,241,410 shares of common stock, at a conversion price of $1.50 per share (stated value of $15.00 per share) for aggregate gross proceeds of $27.7 million, and which closed on August 12, 2025. In connection with the private placement equity offering, we incurred issuance costs of $1.5 million. The Series A convertible preferred stock is convertible to common stock at a ratio of ten shares of common stock for each share of Series A convertible preferred stock and has a par value of $0.01. The Series A convertible preferred stock ranks senior to common stock with respect to dividend rights and rights on the distribution of assets in an event of liquidation. The Series A convertible preferred stockholders have no voting rights and are entitled to receive dividends on an as converted basis in the same form as dividends granted to holders of common stock. Upon a liquidation, the proceeds available for distribution would be paid pari passu among the holders of shares of common stock and Series A convertible preferred stock, pro rata based on the number of shares held by each such holder and on an as converted basis.

The 13,225,227 shares of common stock and 5,241,410 shares of common stock issuable upon automatic conversion of the Series A convertible preferred stock are registered for resale pursuant to a registration statement filed with and declared effective by the SEC in September 2025.

At a special meeting of stockholders held on October 13, 2025, the Company’s stockholders approved, pursuant to Nasdaq Listing Rule 5635(d), the issuance of shares of common stock in connection with the conversion of the Series A convertible preferred stock, which could, under certain circumstances that may occur in the future, exceed 19.99% of the number of shares of the common stock issued and outstanding prior to such issuance.

We evaluated the terms of the Series A convertible preferred stock under the guidance of ASC 480-10, Distinguishing Liabilities from Equity, and ASC 815-40 and recorded the Series A convertible preferred stock in stockholders’ equity in the condensed consolidated balance sheets.

10. Equity Incentive Plan

Option Plan Activity

The following table summarizes the stock option activity for the nine months ended September 30, 2025:


	Shares (in thousands)			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (Years)
Outstanding at December 31, 2024		26,082		$	4.46		7.80
Granted		6,244		$	1.84
Exercised		(287	)	$	1.46
Expired and forfeited		(3,151	)	$	12.65
Outstanding at September 30, 2025		28,888		$	3.03		7.91

We estimated the fair value of each option grant on the grant date using the Black-Scholes option pricing model and for market-based stock option grants using the Monte Carlo simulation model. The following are the weighted-average assumptions:

	For the Six Months Ended
	For the Nine Months Ended
	June 30,
	September 30,
	2025			2024
Risk-free interest rate		4.32	%		43.27	%
Dividend yield		0.0	%		0.0	%
Volatility		80.1	%		7479.98	%
Expected life (years)	6 to 10			6 to 10

The following table summarizes the restricted stock unit activity ("RSUs") for the ~~six~~nine months ended ~~June~~September 30, 2025:

	Shares(in thousands)			Weighted-Average Grant Date Fair Value
Outstanding at December 31, 2024		1,981		$	2.35
Granted		2,~~807~~896		$	1.8482
Released		(~~458~~663	)	$	21.0695
Expired and forfeited		(~~197~~200	)	$	2.5857
Outstanding at June 30, 2025		4,133		$	1.97
Outstanding at September 30, 2025		4,014		$	1.94

The fair value of RSUs is estimated based on the closing market price of our common stock on the date of the grant. RSUs generally vest quarterly over a four-year period.

We estimated the fair value of each purchase right granted under our 1997 Employee Stock Purchase Plan, as amended, at the beginning of each new offering period using the Black-Scholes option pricing model. The following are the weighted average assumptions:

	For the Six Months Ended
	For the Nine Months Ended
	June 30,
	September 30,
	2025			2024
Risk-free interest rate		4.2	%		5.4	%
Dividend yield		0.0	%		0.0	%
Volatility		79.1	%		83.6	%
Expected life (months)		6			6

Stock-Based Compensation

The following table summarizes stock-based compensation expense related to stock-based payment awards granted pursuant to all of our equity compensation arrangements (in thousands):

Three Months EndedJune 30,

Six Months EndedJune 30,

Three Months EndedSeptember 30,

Nine Months EndedSeptember 30,

2025

2024

2025

2024

Research and development

~~276~~277

~~553~~361

~~521~~797

1,~~254~~615

General and administrative

1,~~825~~918

21,~~060~~671

35,~~396~~315

35,~~938~~609

Sales and marketing

~~696~~657

~~1,957~~690

12,~~391~~048

23,~~753~~443

Total stock-based compensation expense

2,~~797~~852

42,~~570~~722

58,~~308~~160

710,~~945~~667

21As of September 30, 2025, there was $24.4 million of total unrecognized compensation cost related to non-vested, stock-based payment awards granted under all of our equity compensation plans and all non-plan option grants. Total unrecognized compensation cost will be adjusted for future changes in estimated forfeitures. We expect to recognize this compensation cost over a weighted-average period of two years.

As of June 30, 2025, there was $26.8 million of total unrecognized compensation cost related to non-vested, stock-based payment awards granted under all of our equity compensation plans and all non-plan option grants. Total unrecognized compensation cost will be adjusted for future changes in estimated forfeitures. We expect to recognize this compensation cost over a weighted-average period of three years.

11. Income Taxes

Deferred income tax assets and liabilities are recognized for temporary differences between financial statements and income tax carrying values using tax rates in effect for the years such differences are expected to reverse. Due to uncertainties surrounding our ability to generate future taxable income and consequently realize such deferred income tax assets, a full valuation allowance has been established. We continue to maintain a full valuation allowance against our deferred tax assets as of ~~June~~September 30, 2025.

The impact of an uncertain income tax position on the income tax return must be recognized at the largest amount that is more likely than not to be sustained upon audit by the relevant tax authority. An uncertain income tax position will be recognized when it is more likely than not of being sustained. The disclosures regarding uncertain tax positions included in our 2024 Annual Report, continue to be accurate for the three and ~~six~~nine months ended ~~June~~September 30, 2025.

2223

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read together with our condensed consolidated financial statements and related notes included in this Quarterly Report on Form 10-Q and the audited consolidated financial statements and related notes included in our 2024 Annual Report. Some information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our plans and strategy for our business, include forward-looking statements that involve risks and uncertainties. You should review the sections entitled "Forward-Looking Statements" and "Risk Factors" in our 2024 Annual Report, Quarterly Reports on Form 10-Q and other reports for a discussion of important factors that could cause our actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Introduction

Management's discussion and analysis of financial condition and results of operations is provided as a supplement to the consolidated financial statements and notes, included in this Quarterly Report on Form 10-Q to help provide an understanding of our financial condition, the changes in our financial condition and our results of operations. Our discussion is organized as follows:

•

Overview. This section provides a general description of our business and operating expenses, as well as other matters that we believe are important to understanding our results of operations and financial condition and in anticipating future trends.

•

Critical Accounting Estimates. This section contains a discussion of the accounting estimates that require a significant level of estimation uncertainty, and changes in which are reasonably likely to have a material effect on our financial condition or results of operations. In addition, all of our significant accounting policies are summarized in Note 3—Accounting Policies to the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

•

Results of Operations. This section provides an analysis of our results of operations presented in the accompanying condensed consolidated statements of operations and comprehensive loss by comparing the results for the three and ~~six~~nine months ended ~~June~~September 30, 2025 and 2024.

•

Liquidity and Capital Resources. This section provides a discussion of our financial condition and liquidity, an analysis of our cash flows for the ~~six~~nine months ended ~~June~~September 30, 2025 and 2024, and a discussion of our outstanding commitments and contingencies that existed as of ~~June~~September 30, 2025.

Overview

Acute Care Product Portfolio

ZYNRELEF

ZYNRELEF is a dual-acting local anesthetic that delivers a fixed-dose combination of the local anesthetic bupivacaine and a low dose of the nonsteroidal anti-inflammatory drug meloxicam. ZYNRELEF is the first and only modified-release local anesthetic to be classified by the FDA as an extended-release product because ZYNRELEF demonstrated in Phase 3 studies significantly reduced pain and significantly increased proportion of patients requiring no opioids through the first 72 hours following surgery compared to bupivacaine solution, the current standard-of-care local anesthetic for postoperative pain control.

ZYNRELEF was initially approved by the FDA in May 2021, and we commenced commercial sales in the U.S. in July 2021. In each of December 2021 and January 2024, the FDA approved an expansion of ZYNRELEF's indication. ZYNRELEF is approved for use in adults for postsurgical analgesia for up to 72 hours after soft tissue and orthopedic surgical procedures including foot and ankle, and other orthopedic surgical procedures in which direct exposure to articular cartilage is avoided. In September 2024, the FDA approved the prior approval supplement ("PAS") application for ZYNRELEF Vial Access Needle ("VAN"), which is replacing the current vented vial spike.

2324

In March 2022, the Centers for Medicare and Medicaid Services ("CMS") approved a 3-year transitional pass-through status of ZYNRELEF, which became effective on April 1, 2022 and expired March 31, 2025, for separate reimbursement outside of the surgical bundle payment in the Hospital Outpatient Department ("HOPD") setting of care. In addition, in December 2022, H.R. 2617, the omnibus spending bill was approved by Congress, which includes the Non-Opioids Prevent Addiction in the Nation ("NOPAIN") Act which directs CMS to provide separate Medicare reimbursement for non-opioid treatments that are used to manage pain during surgeries conducted in hospital outpatient departments or in ambulatory surgical centers. To qualify, the non-opioid treatment must demonstrate the ability to replace, reduce, or avoid intraoperative or postoperative opioid use or the quantity of opioids prescribed in a clinical trial or through data published in a peer-reviewed journal. The hospital outpatient prospective payment system and ambulatory surgical center proposed rule for calendar year 2025 includes ZYNRELEF as a qualifying non-opioid requiring CMS to provide separate Medicare reimbursement in both the hospital outpatient department and ambulatory surgical center settings from ~~January~~April 1, 2025, through December 31, 2027.

APONVIE

APONVIE is the first and only intravenous formulation of a substance P/neurokinin-1 ("NK1") receptor antagonist indicated for postoperative nausea and vomiting ("PONV") in adults. Delivered via a single 30-second intravenous ("IV") injection, APONVIE has demonstrated rapid achievement of therapeutic drug levels ideally suited for the surgical setting.

APONVIE was approved by the FDA in September 2022 and became commercially available in the U.S. in March 2023. APONVIE is indicated for the prevention of PONV in adults. CMS granted pass-through payment status for APONVIE, effective April 1, 2023.

Oncology Care Product Portfolio

CINVANTI

CINVANTI is an IV formulation of aprepitant, a substance NK1 receptor antagonist. CINVANTI is the first IV formulation to directly deliver aprepitant, the active ingredient in EMEND® capsules. Aprepitant (including its prodrug, fosaprepitant) is a single-agent NK1 receptor antagonist to significantly reduce nausea and vomiting in both the acute phase (0–24 hours after chemotherapy) and the delayed phase (24–120 hours after chemotherapy). CINVANTI is the first and only IV formulation of an NK1 receptor antagonist indicated for the prevention of acute and delayed nausea and vomiting associated with Highly Emetogenic Cancer ("HEC") and nausea and vomiting associated with Moderately Emetogenic Cancer ("MEC") that is free of synthetic surfactants, including polysorbate 80.

CINVANTI, in combination with other antiemetic agents, is indicated in adults for the prevention of acute and delayed nausea and vomiting associated with initial and repeat courses of HEC including high-dose cisplatin as a single-dose regimen, delayed nausea and vomiting associated with initial and repeat courses of MEC as a single-dose regimen, and nausea and vomiting associated with initial and repeat courses of MEC as a 3-day regimen.

NK1 receptor antagonists are typically used in combination with 5-hydroxytryptamine ("5-HT3") receptor antagonists. The only other injectable NK1 receptor antagonist currently approved in the U.S. for both acute and delayed chemotherapy induced nausea and vomiting ("CINV"), EMEND® IV (fosaprepitant), contains polysorbate 80, a synthetic surfactant, which has been linked to hypersensitivity reactions, including anaphylaxis, and infusion site reactions. The CINVANTI formulation does not contain polysorbate 80 or any other synthetic surfactant. Our CINVANTI data has demonstrated the bioequivalence of CINVANTI to EMEND IV, supporting its efficacy for the prevention of both acute and delayed nausea and vomiting associated with HEC and nausea and vomiting associated with MEC. Results also showed CINVANTI was better tolerated in healthy volunteers than EMEND IV, with significantly fewer adverse events reported with CINVANTI.

CINVANTI was approved by the FDA in November 2017, and we commenced commercial sales in the U.S. in January 2018.

SUSTOL

SUSTOL is the first extended-release 5-HT3 receptor antagonist approved for the prevention of acute and delayed nausea and vomiting associated with both MEC and anthracycline and cyclophosphamide ("AC") combination chemotherapy regimens. A standard of care in the treatment of breast cancer and other cancer types, AC regimens are among the most commonly prescribed HEC regimens, as defined by both the National Comprehensive Cancer Network ("NCCN") and the American Society of Clinical Oncology ("ASCO").

2425

SUSTOL is indicated in combination with other antiemetics in adults for the prevention of acute and delayed nausea and vomiting associated with initial and repeat courses of MEC or AC combination chemotherapy regimens. SUSTOL is an extended-release, injectable 5-HT3 receptor antagonist that utilizes our Biochronomer Technology to maintain therapeutic levels of granisetron for ≥5 days. The SUSTOL global Phase 3 development program was comprised of two, large, guideline-based clinical studies that evaluated SUSTOL's efficacy and safety in more than 2,000 patients with cancer. SUSTOL's efficacy in preventing nausea and vomiting was evaluated in both the acute phase (0–24 hours following chemotherapy) and the delayed phase (24–120 hours following chemotherapy).

SUSTOL was approved by the FDA in August 2016, and we commenced commercial sales in the U.S. in October 2016.

Biochronomer Technology

Our proprietary Biochronomer Technology is designed to deliver therapeutic levels of a wide range of otherwise short-acting pharmacological agents over a period from days to weeks with a single administration. Our Biochronomer Technology consists of polymers that have been the subject of comprehensive animal and human toxicology studies that have shown evidence of the safety of the polymer. When administered, the polymers undergo controlled hydrolysis, resulting in a controlled, sustained release of the pharmacological agent encapsulated within the Biochronomer-based composition. Furthermore, our Biochronomer Technology is designed to permit more than one pharmacological agent to be incorporated, such that multimodal therapy can be delivered with a single administration.

Recent Events

On August 8, 2025, we entered into the Second Amendment to the Working Capital Facility Agreement with Hercules Capital, Inc., as administrative agent, collateral agent and lender, which among other things, (i) provides for an aggregate principal amount of up to $150.0 million plus the accrued and unpaid paid-in-kind interest on the existing debt under the Initial Working Capital Facility Agreement, which was funded on August 12, 2025 (the “Closing Date”) and (ii) extends the maturity date of the Working Capital Facility Agreement to September 1, 2030. See Note 8 - Long-Term Debt and Convertible Notes to the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q. Concurrently on the Closing Date, we (i) issued and sold $35.0 million aggregate principal amount of 2031 Convertible Notes in a private placement pursuant to a note purchase agreement entered with a fund affiliated with Rubric Capital Management LP, for which we received a total of $31.9 million, net of issuance costs and original issuance discount, (ii) issued and sold 13,225,227 shares of common stock at a purchase price of $1.50 per share and 524,141 shares of Series A convertible preferred stock, which would automatically convert upon stockholder approval into 5,241,410 shares of common stock, at a conversion price of $1.50 per share (stated value of $15.00 per share) for aggregate gross proceeds of $27.7 million, (iii) exchanged all $150.0 million aggregate principal amount of the 2026 Convertible Notes outstanding for 16,666,666 shares of common stock for an aggregate principal amount of $25.0 million of the 2026 Convertible Notes and paid the remaining $125.0 million plus accrued and unpaid interest under the 2026 Convertible Notes in cash. At a special meeting of stockholders held on October 13, 2025, the Company’s stockholders approved, pursuant to Nasdaq Listing Rule 5635(d), the issuance of shares of common stock in connection with the conversion, at the option of the holders, of the 2031 Convertible Notes and the Series A convertible preferred stock.

Material Trends and Developments

~~There~~We ~~are~~intend noto ~~material~~wind ~~changes~~down commercialization of SUSTOL over the next 12 months while we evaluate potential product updates. Subject to ~~our~~development ~~material~~progress, ~~trends~~manufacturing readiness, and ~~developments~~regulatory ~~disclosures~~feedback, ~~included~~we inmay ~~our~~consider ~~2024~~reintroducing ~~Annual~~SUSTOL ~~Report~~as ~~during~~early as late 2027. During the ~~three~~wind down, we’ll continue to support customers and ~~six~~manage ~~months~~inventory ~~ended~~responsibly, ~~June~~and 30we expect one time transition costs, ~~2025~~which we’ll quantify as plans are finalized.

There are no other material changes to our material trends and developments disclosures included in our 2024 Annual Report during the three and nine months ended September 30, 2025.

Contractual Obligations and Commitments

Purchase Obligations

Framework Agreement

On August 6, 2025, we entered into a Framework Agreement (the “Framework Agreement”) with Patheon Austria GmbH & Co KG (“Patheon”) and Thermo Fisher Scientific Inc. (solely for purposes as specified therein). Under the Framework Agreement, Patheon will manufacture and supply specific quantities of certain products, continue to perform certain ongoing stability studies related to such products and provide warehousing services, subject to the terms of a manufacturing and supply agreement previously entered into by us and Patheon, as amended by the amendments set forth in the Framework Agreement. We are required to purchase certain quantities of such products through December 31, 2026, but our monthly payment for such products may be reduced for unreleased products or non-conforming products if the products are not released by specified release dates. The Framework Agreement was effective on August 6, 2025 and will be in effect through and terminate automatically on December 31, 2026, other than with respect to any ongoing project addendums for stability studies entered into prior to December 31, 2026.

Lease Obligations

We have entered into two operating leases for laboratory and office space. Our laboratory and office space in San Diego, California, a portion of which has been subleased to a third party, has a lease term that expires on December 31, 2025. Our one five-year option to renew this lease on expiration applies only with respect to the portion of the premise that has not been subleased. The lease for office space in Cary, North Carolina is expected to commence no later than May 25, 2026 and expire 111 months from the lease commencement date, with the option to extend for one additional period of 84 months upon written notice. As the lease commencement date has not yet occurred, no right-of-use asset or lease liability has been recognized in the accompanying condensed consolidated financial statements. We provided the landlord with a letter of credit for $0.2 million, which is included within cash and cash equivalents in the condensed consolidate balance sheet.

Critical Accounting Estimates

The discussion and analysis of our financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We evaluate our estimates on an ongoing basis, including those related to revenue recognition, investments, inventory and the related reserves, accrued clinical and manufacturing liabilities, income taxes, ~~and~~ stock-based compensation and accounting for debt and equity transactions. We base our estimates on historical experience and on assumptions that we believe to be reasonable under the circumstances, the results of which form the basis of making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ materially from these estimates under different assumptions or conditions.

Our critical accounting estimates include: revenue recognition, investments, inventory and the related reserves, accrued clinical and manufacturing liabilities, income taxes, and stock-based compensation. There are no material changes to our critical accounting estimates disclosures included in our 2024 Annual Report, during the three and ~~six~~nine months ended ~~June~~September 30, 2025.

Recent Accounting Pronouncements

See Note 3 - Accounting Policies - Recent Accounting Pronouncements to the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

2527

Results of Operations for the Three and ~~Six~~Nine Months Ended ~~June~~September 30, 2025 and 2024

The following table summarizes the results of our operations for the three and ~~six~~nine months ended ~~June~~September 30, 2025 and 2024 (in thousands):

	Three Months Ended June 30,												Six Months Ended June 30,
	Three Months Ended September 30,												Nine Months Ended September 30,
($ in thousands)	2025			% of Sales			2024			% of Sales			2025			% of Sales			2024			% of Sales
Net product sales	$	3738,~~200~~213					$	3632,~~024~~810					$	76114,~~103~~316					$	70103,~~694~~504
Cost of product sales		911,~~857~~914			2631.52	%		109,~~518~~458			2928.28	%		1830,~~314~~228			2426.14	%		1828,~~962~~420			2627.85	%
Gross profit	$	2726,~~343~~299					$	2523,~~506~~352					$	5784,~~789~~088					$	5175,~~732~~084
Operating expenses:
Research and development		23,~~934~~470			7.9.1	%		4,~~432~~465			1213.36	%		58,~~213~~683			67.86	%		913,~~040~~505			1213.80	%
General and administrative		1413,~~471~~980			3836.96	%		1312,~~905~~373			3837.67	%		2741,~~173~~153			3536.70	%		2841,~~879~~252			4039.9	%
Sales and marketing		1112,~~575~~942			3133.19	%		1310,~~614~~972			3733.84	%		2336,~~886~~828			3132.42	%		2536,~~056~~028			3534.48	%
(Loss) income from operations	$	(1,637	)	(4.4%)			$	(6,445	)	(17.9%)			$	1,517			2.0	%	$	(11,243	)	(15.9%)
Loss from operations	$	(4,093	)	(9.7%)			$	(4,458	)	(13.6%)			$	(2,576	)	(1.9%)			$	(15,701	)	(15.2%)

Net Product Sales

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

2025

2024

2025

2024

Acute Care Net Product Sales

1012,~~653~~347

67,~~851~~385

2033,~~954~~300

1219,~~290~~676

Oncology Net Product Sales

2625,~~547~~866

2925,~~173~~425

5581,~~149~~016

5883,~~404~~828

Total Net Product Sales

3738,~~200~~213

3632,~~024~~810

76114,~~103~~316

70103,~~694~~504

Total acute care net product sales increased 5567.52% or $34.89 million during the three months ended ~~June~~September 30, 2025, as compared to the comparable period in 2024.

Total acute care net product sales increased 7069.52% or $813.76 million during the ~~six~~nine months ended ~~June~~September 30, 2025, as compared to the comparable period in 2024.

These increases were primarily attributable to an increase in the units sold as a result of an increase in market share and new customers for both ZYNRELEF and APONVIE.

Total oncology net product sales ~~decreased~~increased 91.07% or $20.64 million during the three months ended ~~June~~September 30, 2025, as compared to the comparable period in 2024.

~~Total~~The ~~oncology~~increase ~~net~~was ~~product~~primarily ~~sales~~attributable ~~decreased~~to ~~5.6%~~an orincrease ~~$3.3~~in ~~million~~units ~~during~~sold, ~~the~~offset ~~six~~by ~~months~~an ~~ended~~increase ~~June~~in 30discounts, ~~2025,~~rebates asand ~~compared~~administrative ~~to the comparable period in 2024~~fees.

~~These~~Total ~~decreases~~oncology ~~were~~net ~~primarily~~product ~~attributable~~sales todecreased ~~market~~3.4% ~~competition~~or ~~from branded products and generics~~$2.8 ~~The~~million ~~competition~~during ~~and~~the ~~decreases~~nine inmonths ~~oncology~~ended ~~net~~September ~~product~~30, ~~sales~~2025, ~~are~~as ~~expected~~compared to ~~continue~~the ~~for~~comparable ~~the~~period ~~foreseeable~~in ~~future~~2024.

The decrease was primarily attributable to market competition from branded products and generics. The competition and decreases in oncology net product sales are expected to continue for the foreseeable future.

Cost of Product Sales and Gross Profit

Cost of product sales ~~decreased~~increased by 626.30% or $02.75 million during the three months ended ~~June~~September 30, 2025, as compared to the comparable period in 2024 and as a percentage of sales ~~decreased~~increased 2.74% during the same period.

Cost of product sales ~~decreased~~increased by 36.4% or $01.68 million during the ~~six~~nine months ended ~~June~~September 30, 2025, as compared to the comparable period in 2024 and as a percentage of sales decreased by 21.81% during the same period.

Gross profit for the three months ended ~~June~~September 30, 2025 was 7368.58%, compared to 7071.82% for the comparable period ended ~~June~~September 30, 2024.

Gross profit for the ~~six~~nine months ended ~~June~~September 30, 2025 was 7573.96%, compared to 7372.25% for the comparable period ended ~~June~~September 30, 2024.

The increase in gross profit with a corresponding decrease in cost of product sales for the three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024 is due to an increase in units sold, at a higher cost per unit due to supplier mix, offset by lower inventory reserves and write-offs.28

26The increase in cost of product sales for the three months ended September 30, 2025, as compared to the same period ended September 30, 2024, is primarily attributable to an increase of $1.4 million of inventory reserves and write-offs recorded and an increase of $1.3 million in the cost of units sold, primarily due to supplier mix.

The increase in cost of product sales for the nine months ended September 30, 2025, as compared to the same period ended September 30, 2024, is primarily attributable to an increase in units sold combined with a lower cost per unit due to supplier mix.

Research and Development Expense

Reclassification of Certain Expenses

The table of research and development expense below for the three and ~~six~~nine months ended ~~June~~September 30, 2024 reflect reclassification of certain expenses amongst products to align with the Company's presentation for the three and ~~six~~nine months ended ~~June~~September 30, 2025 as a result of further review of the nature of the expenses. This presentation results in no change to total operating expenses, loss from operations or net loss and no pro forma financial information is necessary.

Research and development expense consisted of the following (in thousands):

Three Months EndedJune 30,

Six Months EndedJune 30,

Three Months EndedSeptember 30,

Nine Months EndedSeptember 30,

2025

2024

2025

2024

ZYNRELEF-related costs

1,~~099~~944

12,~~982~~426

13,~~917~~861

25,~~630~~056

SUSTOL-related costs

75—

~~173~~53

~~259~~312

CINVANTI-related costs

~~302~~—

~~401~~319

302

~~862~~1,180

APONVIE-related costs

1—

40157

~~239~~396

Personnel costs and other expenses

1,~~181~~249

1,~~283~~149

23,~~397~~647

34,~~796~~946

Stock-based compensation expense

~~276~~277

~~553~~361

~~521~~797

1,~~254~~615

Total research and development expense

23,~~934~~470

4,~~432~~465

58,~~213~~683

913,~~040~~505

Research and development expense decreased by $1.50 million or 3322.83%, during the three months ended ~~June~~September 30, 2025 compared to the same period in 2024. The decrease in costs is primarily attributable to a $10.28 million ~~more~~decrease ~~of write-off of property and equipment~~ in ~~2024~~contract ~~than~~services indue ~~2025,~~to timing and a $0.4 million decrease in ~~personnel~~write-offs ~~and related expenses~~ of ~~$0.3~~property ~~million~~and ~~due to terminations~~equipment.

Research and development expense decreased by $34.8 million or 4235.37%, during the ~~six~~nine months ended ~~June~~September 30, 2025 compared to the same period in 2024. The decrease in costs is primarily attributable to a $1.2.0 million ~~more~~decrease in personnel and related expenses due to terminations, a decrease of $1.6 million in write-~~off~~offs of property and equipment inand ~~2024~~other ~~than~~assets ~~in 2025,~~ and a decrease ~~in personnel and related expenses~~ of $2.0.9 million in contract services due to ~~terminations~~timing.

General and Administrative Expense

General and administrative expense increased by $01.6 million or 413.10%, during the three months ended ~~June~~September 30, 2025 compared to the same period in 2024. The increase in costs is primarily attributable to $0.38 million increase in personnel and related expenses due to net new hires and a $0.45 million increase in contract services due to timing. ~~These increases were offset by a decrease of $0.2 million in legal expenses due to timing of litigation.~~

General and administrative expense decreased by $10.71 million or 50.92%, during the ~~six~~nine months ended ~~June~~September 30, 2025 compared to the same period in 2024. The decrease in costs is primarily attributable to a $10.7 million decrease in legal expense due to timing of litigation, a $0.6 million decrease in personnel and related costs due to terminations. These decreases were partially offset by an increase of $1.1 million in contract services due to timing.

Sales and Marketing Expense

Sales and marketing expense ~~decreased~~increased by $2.0 million or 1518.0%, during the three months ended ~~June~~September 30, 2025 compared to the same period in 2024. The ~~decrease~~increase is primarily attributable to aan ~~decrease~~increase in ~~personnel~~marketing ~~and~~costs ~~related expenses~~ of $2.1.5 million, asprimarily arelated ~~result~~to ofZYNRELEF ~~terminations~~ and a ~~one-time stock compensation expense in 2024, which did not reoccur in 2025~~$0.3 ~~The~~million ~~decrease is offset by an~~ increase in ~~marketing~~personnel ~~costs~~and ofrelated ~~$0.2~~expenses ~~million,~~due ~~primarily~~to ~~related~~net tonew ~~ZYNRELEF~~hires.

Sales and marketing expense ~~decreased~~increased by $10.28 million or 42.72%, during the ~~six~~nine months ended ~~June~~September 30, 2025 compared to the same period in 2024. The ~~decrease~~increase is primarily attributable to a $12.92 million ~~decrease in personnel and related costs as a result of terminations and a one-time stock compensation expense in 2024, which did not reoccur in 2025. The decrease is offset by an~~ increase in marketing costs ~~of $0.6 million~~, primarily related to ~~ZYNRELEF.~~

ZYNRELEF, partially offset by a decrease in personnel and related costs of $1.6 million as a result of a one-time stock compensation expense in 2024, which did not reoccur in 2025.

Other Expense, Net

For the three months ended ~~June~~September 30, 2025, other expense, net was $013.74 million, compared to $20.84 million, for the same period in 2024. The ~~decrease~~increase in expense is related to athe ~~one-time~~loss ~~settlement~~on debt extinguishment of $11.3 million and an increase in ~~2024~~interest ~~which~~expense ~~did~~as ~~not~~a ~~reoccur~~result of the debt refinancing completed in 2025.

27For the nine months ended September 30, 2025, other expense, net, was $14.7 million compared to $1.5 million for the same period in 2024. The increase in expense is related to the loss on debt extinguishment of $11.3 million, an increase in interest expense as a result of the debt refinancing completed in 2025, and a decrease in interest income as a result of a decreasing interest rates.

For the six months ended June 30, 2025, other expense, net, was $1.3 million compared to $1.2 million for the same period in 2024.

Liquidity and Capital Resources

Sources of Liquidity

As of ~~June~~September 30, 2025, we had cash, cash equivalents and short-term investments of $4055.65 million. Our net loss for the three months ended ~~June~~September 30, 2025 was $217.45 million, or $0.0210 per share, compared to a net loss of $94.28 million, or $0.0603 per share, for the same period in 2024. Our net ~~income~~loss for the ~~six~~nine months ended ~~June~~September 30, 2025 was $017.32 million, or ~~nil~~$0.11 per share, compared to a net loss of $1217.42 million, or $0.0811 per share, for the same period in 2024. We have incurred significant operating losses and negative cash flows from operations and had an accumulated deficit of $1.9 billion as of ~~June~~September 30, 2025. From our inception through ~~June~~September 30, 2025, we have financed our growth and operations, including technology and product research and development, primarily through the issuance of common stock, convertible notes and warrants, product sales and debt financings. Based on our current operating plan and projections, management believes that the Company's cash, cash equivalents and short-term investments will be sufficient to meet the Company's anticipated cash requirements for a period of at least one year from the issuance of the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q. We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect, which would have a material impact on our operations.

Future Funding Requirements

As of June 30, 2025, we had cash, cash equivalents and short-term investments of $40.6 million. Subsequent to entering into the closing of the Refinancing Transactions, and based on our current operating plan and projections, management believes that our cash, cash equivalents, and short-term investments, will be sufficient to meet our anticipated cash requirements for a period of at least one year from the date that the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q are issued.

We continuously evaluate our liquidity and capital resources, including access to external capital, in light of current economic and market conditions and our operational performance. Our future cash requirements and the adequacy of our available funds will depend on many factors, primarily including our ability to generate revenue and the scope and costs of our commercial and research and development activities.

Cash Flows

The net change in cash and cash equivalents consisted of the following:

Our net cash used in operating activities for the ~~six~~nine months ended ~~June~~September 30, 2025 and ~~June~~September 30, 2024 was $1918.74 million and $1410.17 million, respectively. The increase in net cash used in operating activities of $57.67 million or 3971.82%, was primarily attributable to payments for inventory, accounts payable, and accrued clinical and manufacturing liabilities, partially offset by a decrease in net loss for the ~~six~~nine months ended ~~June~~September 30, 2025 compared to the same period in 2024 and the loss on debt extinguishment recognized in the nine months ended September 30, 2025.

Our net cash provided by investing activities for the ~~six~~nine months ended ~~June~~September 30, 2025, and ~~June~~September 30, 2024 was $921.65 million, and $37.3 million, respectively. The increase in net cash provided by investing activities of $614.32 million or approximately two-fold, was primarily attributable to net maturities of short-term investments of $921.97 million for the ~~six~~nine months ended ~~June~~September 30, 2025 compared to $48.04 million for the ~~three~~nine months ended ~~June~~September 30, 2024.

Our net cash provided by financing activities for the ~~six~~nine months ended ~~June~~September 30, 2025, and ~~June~~September 30, 2024 was $014.82 million, and $0.5 million, respectively. The increase in net cash provided by financing activities of $13.7 million is primarily attributable to $13.4 million in cash provided through the debt and equity transactions which closed in the nine months ended September 30, 2025.

Material Cash Requirements

There are no material changes to our material cash requirements disclosures included in our 2024 Annual Report during the three and ~~six~~nine months ended ~~June~~September 30, 2025.

Off-Balance Sheet Arrangements

We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements, as defined in the rules and regulations of the SEC.

2831

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Quantitative and qualitative disclosures about market risk are included in "Management's Discussion and Analysis of Financial Condition and Results of Operations - Quantitative and Qualitative Disclosures about Market Risk" in our 2024 Annual Report. There are no material changes to the quantitative and qualitative disclosures included in our 2024 Annual Report during the three and ~~six~~nine months ended ~~June~~September 30, 2025.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

Our management, with the participation of our principal executive and principal financial officers, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 ("Exchange Act")) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on this evaluation, our principal executive and principal financial officers concluded that our disclosure controls and procedures were effective as of such time.

Limitations on Effectiveness of Controls

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports, filed or submitted under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, including, without limitation, controls and procedures designed to ensure that information required to be disclosed in such reports is accumulated and communicated to our management, including our principal executive officer, principal financial officer, and principal accounting officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable and not absolute assurance of achieving the desired control objectives. In reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. In addition, the design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, a control may become inadequate because of changes in conditions or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the quarter covered by this Quarterly Report on Form 10-Q that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

2932

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Except as discussed below, there are no material changes from the legal proceedings previously disclosed in our 2024 Annual Report during the three and ~~six~~nine months ended ~~June~~September 30, 2025.

On ~~August~~June 414, ~~2023~~2022, the Company received a ~~Notice~~paragraph ~~Letter~~IV notice of certification (the ~~"Mylan~~“Fresenius ~~August~~Kabi Notice"”) from ~~Mylan~~Fresenius ~~Pharmaceuticals~~Kabi ~~Inc. ("Mylan")~~ advising that ~~Mylan~~Fresenius Kabi had submitted an ANDA to the FDA seeking approval to manufacture, use or sell a generic version of CINVANTI ~~("Mylan's ANDA for a generic version of CINVANTI")~~ in the U.S. prior to the expiration of U.S. Patent Nos.: 9,561,229; 9,808,465; 9,974,742; 9,974,793; 9,974,794; 10,500,208; 10,624,850; 10,953,018; and 11,173,118 (the "“CINVANTI Patents"”), which are listed in the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations (the “Orange Book”). The ~~Mylan~~Fresenius ~~August~~Kabi Notice alleges that the CINVANTI Patents are invalid, unenforceable and/or will not be infringed by the commercial manufacture, use or sale of the generic product described in ~~Mylan's~~Fresenius ANDA for a generic version of CINVANTI. On September 15, 2023, the Company filed a complaint for patent infringement of the CINVANTI Patents against Mylan in the U.S. District Court for the District of Delaware in response to the filing of Mylan'Kabi’s ANDA ~~for a generic version of CINVANTI~~. The complaint seeks, among other relief, equitable relief enjoining Mylan from infringing the CINVANTI Patents. On November 9, 2023, the Company received an updated Notice Letter from Mylan advising that it had submitted an amendment to Mylan's ANDA for a generic version of CINVANTI to include a Paragraph IV certification to the Company's recently listed U.S. Patent No. 11,744,800. On May 6, 2025, the Company announced that it entered into a settlement agreement with Mylan to resolve the ongoing patent litigation in the U.S. District Court for the District of Delaware related to Mylan's ANDA for a generic version of CINVANTI. Pursuant to the terms of the settlement agreement, the Company has granted Mylan a license under the Orange Book-listed patents for CINVANTI to market a generic version of CINVANTI in the U.S. beginning June 1, 2032, or earlier under certain customary circumstances. In connection with the settlement, on May 6, 2025, the Court granted the Stipulation and Order of Dismissal with the U.S. District Court for the District of Delaware requesting that the Court dismiss the pending litigation between the parties.

On ~~December~~July 1627, ~~2023~~2022, the Company ~~received~~filed a ~~Notice~~complaint Letter (the "Mylan December Notice") from Mylan advising that Mylan had submitted an ANDA to the FDA seeking approval to manufacture, use or sell a generic version of APONVIE in the U.S. ("Mylan's ANDA for apatent ~~generic~~infringement ~~version~~ of ~~APONVIE") prior to~~ the ~~expiration~~CINVANTI ~~of U.S. Patent Nos.: 9,561,229; 9,808,465; 9,974,742; 9,974,793; 9,974,794; 10,500,208; 10,624,850; 10,953,018; 11,173,118; and 11,744,800 (the "APONVIE~~ Patents~~"),~~ ~~which~~against ~~are~~Fresenius ~~listed~~Kabi ~~in the Orange Book. The Mylan December Notice Letter alleges that the APONVIE Patents are invalid, unenforceable~~ and~~/or~~ ~~will not be infringed by the commercial manufacture, use or sale of the generic product described in Mylan's ANDA for~~ a ~~generic~~related ~~version~~entity ~~of APONVIE. On January 11, 2024, the Company filed a complaint for patent infringement of the APONVIE Patents against Mylan~~ in the U.S. District Court for the District of Delaware (the “Court”) in response to ~~Mylan~~Fresenius ~~filing~~Kabi’s an ANDA ~~for a generic version of APONVIE~~filing. The complaint seeks, among other relief, equitable relief enjoining ~~Mylan~~Fresenius Kabi from infringing the ~~APONVIE~~CINVANTI Patents. On ~~January~~May 2615, 2024, the Court ~~consolidated~~granted ~~this~~partial ~~litigation~~summary ~~concerning~~judgment ~~Mylan's ANDA for a generic version~~ of ~~APONVIE~~infringement ~~with the previously-filed litigation concerning Mylan's ANDA~~ for ~~a generic version of CINVANTI. On May 6, 2025,~~ the Company ~~announced~~and ~~that~~found itno ~~entered~~indefiniteness ~~into~~of ~~a settlement agreement with Mylan to resolve the ongoing patent litigation in the~~ U.S. ~~District~~Patent ~~Court~~Nos. ~~for~~9,561,229 ~~the~~and ~~District of Delaware related to Mylan's ANDA for a generic version of APONVIE~~9,974,794. On ~~Pursuant~~June to24, ~~the terms of the settlement agreement~~2024, the ~~Company~~parties ~~has~~commenced ~~granted Mylan~~ a ~~license under the Orange Book~~four-~~listed~~day ~~patents~~bench ~~for~~trial ~~APONVIE~~centered toon ~~market~~Fresenius aKabi’s ~~generic~~defense ~~version~~ of ~~APONVIE~~obviousness inof ~~the~~claims from U.S. ~~beginning~~Patent ~~June~~Nos. 19, ~~2032~~561,229 orand ~~earlier~~9,974,794 ~~under~~that ~~certain~~cover ~~customary circumstances~~CINVANTI. Oral Inargument ~~connection~~was ~~with~~held ~~the settlement,~~ on ~~May~~August 629, ~~2025, the Court granted the Stipulation and Order of Dismissal with the U~~2024.~~S. District Court for the District of Delaware requesting that the Court dismiss the pending litigation between the parties.~~

On December 113, ~~2023~~2024, the ~~Company~~Court ~~received~~issued a ~~Paragraph~~ruling IVin ~~notice of certification (~~the ~~"Slayback~~Company’s ~~Notice") from Slayback Pharma LLC ("Slayback") (now owned by Azurity Pharmaceuticals, Inc~~favor. The ~~("Azurity"))~~Court ~~advising~~found that ~~Slayback had submitted an new drug application under Section 505(b)(2) of~~ the ~~Federal~~Company’s ~~Food, Drug, and Cosmetic Act to the FDA seeking approval to manufacture, use or sell a generic version of CINVANTI in the~~ U.S. ~~("Slayback's~~Patent ~~NDA")~~Nos. ~~prior~~9,561,229 toand ~~the~~9,974,794, ~~expiration~~which ofexpire ~~the patents listed~~ in ~~the~~2035, ~~Orange Book. The Slayback Notice alleges that the CINVANTI Patents~~ are ~~invalid,~~valid ~~unenforceable~~ and~~/or~~ ~~will~~would ~~not~~ be infringed by ~~the~~Fresenius ~~commercial~~Kabi’s ~~manufacture,~~proposed ~~use or sale of the~~ generic product ~~described in Slayback's NDA~~. In Onview ~~January~~of ~~24,~~the ~~2024~~decision, the ~~Company~~Court ~~filed~~ordered athat ~~complaint~~the ~~for~~effective ~~patent~~date ~~infringement~~ of ~~the~~any ~~CINVANTI~~final ~~Patents~~approval ~~against~~by ~~Slayback and a related entity in~~ the U.S. ~~District~~Food ~~Court~~and ~~for~~Drug ~~the~~Administration ~~District~~ of ~~New~~Fresenius ~~Jersey~~Kabi’s inANDA ~~response~~shall tonot ~~Slayback's~~be ~~NDA~~a ~~filing.~~date ~~The~~earlier ~~complaint~~than ~~seeks~~September 18, ~~among other relief~~2035, ~~equitable~~the ~~relief~~expiration ~~enjoining~~date ~~Slayback~~of ~~from~~each ~~infringing~~of ~~those patents~~U.S. OnPatents ~~July~~Nos. 29, ~~2024~~561,229 ~~the~~and U9,974,794.S. On ~~District~~January ~~Court~~8, ~~for~~2025, ~~the~~Fresenius ~~District~~Kabi offiled ~~New~~notice ~~Jersey~~of ~~granted~~appeal ~~Slayback's motion~~ to ~~transfer this matter to~~ the U.S. ~~District~~ Court of Appeals for the ~~District~~Federal ofCircuit ~~Delaware.~~(“Federal Circuit”). On ~~December~~September 1224, ~~2024~~2025, the ~~Company~~briefing ~~filed~~was acompleted, ~~complaint~~and ~~against~~the ~~Slayback,~~Company ~~Azurity,~~awaits ~~and~~a ~~related~~date ~~entities~~for inoral ~~the U~~argument.S. The ~~District~~Company ~~Court~~intends ~~for~~to ~~District~~vigorously ofenforce ~~Delaware~~its ~~for~~intellectual ~~patent~~property ~~infringement~~rights ofrelating to CINVANTI.

30On August 4, 2023, the Company received a Notice Letter (the “Mylan August Notice”) from Mylan Pharmaceuticals Inc. (“Mylan”) advising that Mylan had submitted an abbreviated new drug application ("ANDA") to the FDA seeking approval to manufacture, use or sell a generic version of CINVANTI (“Mylan’s ANDA for a generic version of CINVANTI”) in the U.S. prior to the expiration of U.S. Patent Nos. 9,561,229; 9,808,465; 9,974,742; 9,974,793; 9,974,794; 10,500,208; 10,624,850; 10,953,018; and 11,173,118 (the “CINVANTI Patents”), which are listed in the Orange Book. The Mylan August Notice alleges that the CINVANTI Patents are invalid, unenforceable and/or will not be infringed by the commercial manufacture, use or sale of the generic product described in Mylan’s ANDA for a generic version of CINVANTI. On September 15, 2023, the Company filed a complaint for patent infringement of the CINVANTI Patents against Mylan in the U.S. District Court for the District of Delaware in response to the filing of Mylan’s ANDA for a generic version of CINVANTI. The complaint seeks, among other relief, equitable relief enjoining Mylan from infringing the CINVANTI Patents. On November 9, 2023, the Company received an updated Notice Letter from Mylan advising that it had submitted an amendment to Mylan’s ANDA for a generic version of CINVANTI to include a Paragraph IV certification to the Company's recently listed U.S. Patent No. 11,744,800. On May 6, 2025, the Company announced that it entered into a settlement agreement with Mylan to resolve the ongoing patent litigation in the U.S. District Court for the District of Delaware related to Mylan’s ANDA for a generic version of CINVANTI. Pursuant to the terms of the settlement agreement, the Company has granted Mylan a license under the Orange Book-listed patents for CINVANTI to market a generic version of CINVANTI in the United States beginning June 1, 2032, or earlier under certain customary circumstances. In connection with the settlement, on May 6, 2025, the Court granted the Stipulation and Order of Dismissal with the U.S. District Court for the District of Delaware requesting that the Court dismiss the pending litigation between the parties.

~~the U.S. Patent Nos. 12,115,254 and 12,115,255.~~ On ~~May~~December 2316, ~~2025~~2023, the Company ~~filed~~received ana ~~amended~~Notice ~~complaint~~Letter ~~against~~(the ~~Slayback,~~“Mylan ~~Azurity,~~December ~~and~~Notice”) ~~related~~from ~~entities~~Mylan ~~adding~~advising anthat ~~allegation~~Mylan ofhad ~~patent~~submitted ~~infringement~~an ofANDA ~~U.S.~~to ~~Patent~~the ~~No.~~FDA ~~12,290,520.~~seeking ~~The~~approval ~~parties~~to ~~are~~manufacture, ~~currently~~use inor ~~expert~~sell ~~discovery.~~a Ageneric ~~four-day~~version ~~bench~~of ~~trial~~APONVIE isin ~~currently~~the ~~scheduled for November 17, 2025~~U.S. ~~The~~(“Mylan’s ~~Company~~ANDA ~~intends~~for toa ~~vigorously~~generic ~~enforce~~version ~~its~~of ~~intellectual~~APONVIE”) ~~property~~prior ~~rights relating~~ to ~~CINVANTI.~~the Asexpiration ~~a result~~ of ~~our~~U.S. ~~initial~~Patent ~~complaint~~Nos.: ~~for~~9,561,229; ~~patent~~9,808,465; ~~infringement~~9,974,742; ~~the~~9,974,793; ~~FDA~~9,974,794; ~~may~~10,500,208; ~~not~~10,624,850; ~~approve~~10,953,018; ~~Slayback's~~11,173,118; ~~NDA~~and ~~until~~11,744,800 (the ~~earlier~~“APONVIE ~~of June 12~~Patents”), ~~2026~~which orare ~~resolution~~listed ~~of the litigation.~~

On February 28, 2025, Azurity, Azurity Pharma India LLP, and Slayback requested Post-Grant Review ("PGR") of U.S. Patent Nos. 12,115,254 and 12,115,255 in PGR2025-00035 and PGR2025-00036, respectively. On April 14, 2025, the Petitions were accorded a filing date. On June 16, 2025, the Company filed a brief requesting discretionary denial in the petitions in PGR2025-00035 and PGR2025-00036. The briefing was completed on July 16, 2025, and the Company is awaiting a decision. On July 14, 2025, the Company filed its Patent Owner Preliminary Response. 33

Onin ~~February~~the 7,Orange ~~2025,~~Book. ~~the~~The ~~Company~~Mylan ~~received~~December a Notice Letter ~~(the~~alleges ~~"Qilu~~that ~~Notice")~~the ~~from~~APONVIE ~~Qilu~~Patents ~~Pharmaceutical~~are ~~(Hainan) Co.~~invalid, ~~Ltd~~unenforceable and/or ~~Qilu~~will ~~Pharma,~~not ~~Inc.~~be ~~("Qilu")~~infringed ~~advising~~by ~~that~~the ~~Qilu~~commercial ~~had~~manufacture, ~~submitted~~use anor ~~ANDA~~sale toof the ~~FDA~~generic ~~seeking~~product ~~approval~~described toin ~~manufacture,~~Mylan’s ~~use~~ANDA orfor ~~sell~~ a generic version of APONVIE. inOn January 11, 2024, the ~~U.S.~~Company ~~("Qilu's~~filed ~~ANDA")~~a ~~prior~~complaint tofor ~~the~~patent ~~expiration~~infringement of the APONVIE Patents against Mylan in the U.S. ~~Patent~~District ~~Nos.:~~Court ~~9,561,229;~~for ~~9,808,465;~~the ~~9,974,742;~~District ~~9,974,793;~~of ~~9,974,794;~~Delaware ~~10,500,208;~~in ~~10,624,850;~~response ~~10,953,018;~~to ~~11,173,118;~~Mylan ~~11,744,800,~~filing ~~12,115,254,~~an ~~and~~ANDA ~~12,115,255~~for ~~(the~~a ~~"Noticed~~generic ~~APONVIE~~version ~~Patents"),~~of ~~which~~APONVIE. ~~are~~The ~~listed~~complaint inseeks, ~~the~~among ~~Orange~~other ~~Book~~relief, ~~Qilu's~~equitable ~~ANDA~~relief ~~alleges~~enjoining ~~that~~Mylan ~~the~~from ~~Noticed~~infringing the APONVIE Patents. ~~are~~On ~~invalid~~January 26, ~~unenforceable~~2024, ~~and/or~~the ~~will~~Court ~~not~~consolidated bethis ~~infringed~~litigation byconcerning ~~the~~Mylan’s ~~commercial~~ANDA ~~manufacture,~~for ~~use~~a orgeneric ~~sale~~version of ~~the~~APONVIE ~~generic~~with ~~product~~the ~~described~~previously-filed inlitigation ~~Qilu'~~concerning Mylan’s ANDA for a generic version of ~~APONVIE~~CINVANTI. On ~~March~~May 216, 2025, the Company ~~filed~~announced athat ~~complaint~~it ~~for~~entered ~~patent~~into ~~infringement~~a ofsettlement ~~the~~agreement ~~Noticed~~with ~~APONVIE~~Mylan ~~Patents~~to ~~against~~resolve ~~Qilu~~the ongoing patent litigation in the U.S. District Court for the District of Delaware inrelated ~~response~~ to ~~Qilu'~~Mylan’s ANDA for a generic version of APONVIE. ~~The~~Pursuant ~~complaint~~to ~~seeks,~~the ~~among~~terms ~~other~~of ~~relief~~the settlement agreement, ~~equitable~~the ~~relief~~Company ~~enjoining~~has ~~Qilu~~granted ~~from~~Mylan ~~infringing~~a license under the ~~Noticed~~Orange Book-listed patents for APONVIE ~~Patents~~to market a generic version of APONVIE in the United States beginning June 1, 2032, or earlier under certain customary circumstances. In connection with the settlement, on May 6, 2025, the Court granted the Stipulation and Order of Dismissal with the U.S. District Court for the District of Delaware requesting that the Court dismiss the pending litigation between the parties.

On ~~June~~December 11, ~~2025~~2023, the Company received a ~~Notice~~Paragraph ~~Letter~~IV notice of certification (the ~~"Qilu~~“Slayback ~~CINVANTI~~ Notice"”) from ~~Qilu~~Slayback ~~Pharmaceutical~~Pharma LLC (~~Hainan~~"Slayback") ~~Co.,~~(now ~~Ltd~~owned ~~and~~by ~~Qilu~~Azurity ~~Pharma~~Pharmaceuticals, Inc. ("~~Qilu~~Azurity")) advising that ~~Qilu~~Slayback had submitted an ~~ANDA~~new drug application under Section 505(b)(2) of the Federal Food, Drug, and Cosmetic Act to the FDA seeking approval to manufacture, use or sell a generic version of CINVANTI in the U.S. (~~"Qilu'~~“Slayback’s ~~CINVANTI ANDA"~~NDA”) prior to the expiration of ~~U.S. Patent Nos.: 9,561,229; 9,808,465; 9,974,742; 9,974,793; 9,974,794; 10,500,208; 10,624,850; 10,953,018; 11,173,118; 11,744,800; 12,115,254; 12,115,255; and 12,290,520 (~~the ~~"Noticed~~patents ~~CINVANTI Patents"), which are~~ listed in the Orange Book ~~for CINVANTI~~. ~~Qilu's~~The ~~CINVANTI~~Slayback ~~ANDA~~Notice alleges that the ~~Noticed~~ CINVANTI Patents are invalid, unenforceable, and/or will not be infringed by the commercial manufacture, use or sale of the generic product described in ~~Qilu'~~Slayback’s ~~CINVANTI ANDA~~NDA. On ~~July~~January 324, ~~2025~~2024, the Company filed a complaint for patent infringement of the ~~Noticed~~ CINVANTI Patents against ~~Qilu~~Slayback and a related entity in the U.S. District Court for the District of ~~Delaware~~New Jersey in response to ~~Qilu'~~Slayback’s ~~CINVANTI~~NDA ~~ANDA~~filing. The complaint seeks, among other relief, equitable relief enjoining ~~Qilu~~Slayback from infringing those patents. On July 2, 2024, the ~~Noticed~~U.S. ~~CINVANTI~~District ~~Patents~~Court for the District of New Jersey granted Slayback’s motion to transfer this matter to the U.S. District Court for the District of Delaware. On December 12, 2024, the Company filed a complaint against Slayback, Azurity, and related entities in the U.S. District Court for District of Delaware for patent infringement of the U.S. Patent Nos. 12,115,254 and 12,115,255. On May 23, 2025, the Company filed an amended complaint against Slayback, Azurity, and related entities adding an allegation of patent infringement of U.S. Patent No. 12,290,520. The parties completed expert discovery. The parties’ entered into a stipulation (Case No. 24-1363, D.I. 119) limiting the issues for trial. A bench trial is currently scheduled for November 17, 2025. The Company intends to vigorously enforce its intellectual property rights relating to CINVANTI. As a result of our initial complaint for patent infringement, the FDA may not approve Slayback’s NDA until the earlier of June 12, 2026 or resolution of the litigation.

On ~~July~~February 1528, 2025, ~~the~~Azurity, ~~Qilu~~Azurity ~~CINVANTI~~Pharma ~~and~~India ~~APONVIE~~LLP, ~~litigations~~and ~~were~~Slayback ~~consolidated.~~requested ~~A five~~Post-~~day~~Grant ~~bench~~Review ~~trial~~("PGR") isof ~~currently~~U.S. ~~scheduled~~Patent ~~for~~Nos. ~~November 16~~12,115,254 ~~2026.~~and ~~The~~12,115,255 ~~case is~~ in ~~its~~PGR2025-00035 ~~early stages~~ and aPGR2025-00036, ~~trial has not yet been scheduled~~respectively. ~~The~~On ~~Company~~April ~~intends~~14, to2025, ~~vigorously~~the ~~enforce~~Petitions ~~its~~were ~~intellectual~~accorded ~~property rights relating to CINVANTI and APONVIE. As~~ a ~~result of~~ filing ~~our~~date. ~~complaint~~On ~~for~~June ~~patent~~16, ~~infringement~~2025, the ~~FDA~~Company ~~may~~filed ~~not~~a ~~approve~~brief ~~Qilu's~~requesting ~~ANDA~~discretionary ~~for~~denial ~~a generic version~~ of ~~APONVIE until~~ the ~~earlier~~Petitions ofin ~~August~~PGR2025-00035 7,and ~~2027~~PGR2025-00036. On orJuly ~~resolution~~14, ~~of the litigation~~2025, ~~and~~ the ~~FDA~~Company ~~may~~filed ~~not~~its ~~approve~~Patent ~~Qilu's~~Owner ~~ANDA~~Preliminary ~~for~~Response. On aAugust ~~generic~~14, ~~version~~2025, ~~of CINVANTI until~~ the ~~earlier~~Patent ofTrial ~~December~~and ~~11,~~Appeal ~~2027~~Board ordiscretionarily ~~resolution~~denied institution of ~~the~~Azurity’s ~~litigation~~PGRs.

On February 7, 2025, the Company received a Notice Letter (the “Qilu Notice”) from Qilu Pharmaceutical (Hainan) Co., Ltd and Qilu Pharma, Inc. (“Qilu”) advising that Qilu had submitted an ANDA to the FDA seeking approval to manufacture, use or sell a generic version of APONVIE in the U.S. (“Qilu’s ANDA”) prior to the expiration of U.S. Patent Nos.: 9,561,229; 9,808,465; 9,974,742; 9,974,793; 9,974,794; 10,500,208; 10,624,850; 10,953,018; 11,173,118; 11,744,800, 12,115,254, and 12,115,255 (the “Noticed APONVIE Patents”), which are listed in the Orange Book, Qilu's ANDA alleges that the Noticed APONVIE Patents are invalid, unenforceable and/or will not be infringed by the commercial manufacture, use or sale of the generic product described in Qilu’s ANDA for a generic version of APONVIE. On March 21, 2025, the Company filed a complaint for patent infringement of the Noticed APONVIE Patents against Qilu in the U.S. District Court for the District of Delaware in response to Qilu's ANDA for a generic version of APONVIE. The complaint seeks, among other relief, equitable relief enjoining Qilu from infringing the Noticed APONVIE Patents.

On June 11, 2025, the Company received a Notice Letter (the “Qilu CINVANTI Notice”) from Qilu Pharmaceutical (Hainan) Co., Ltd and Qilu Pharma, Inc. (“Qilu”) advising that Qilu had submitted an ANDA to the FDA seeking approval to manufacture, use or sell a generic version of CINVANTI in the U.S. (“Qilu’s CINVANTI ANDA”) prior to the expiration of U.S. Patent Nos.: 9,561,229; 9,808,465; 9,974,742; 9,974,793; 9,974,794; 10,500,208; 10,624,850; 10,953,018; 11,173,118; 11,744,800; 12,115,254;

12,115,255; and 12,290,520 (the “Noticed CINVANTI Patents”), which are listed in the Orange Book for CINVANTI. Qilu’s CINVANTI ANDA alleges that the Noticed CINVANTI Patents are invalid, unenforceable, and/or will not be infringed by the commercial manufacture, use or sale of the generic product described in Qilu’s CINVANTI ANDA. On July 3, 2025, the Company filed a complaint for patent infringement of the Noticed CINVANTI Patents against Qilu in the U.S. District Court for the District of Delaware in response to Qilu’s CINVANTI ANDA. The complaint seeks, among other relief, equitable relief enjoining Qilu from infringing the Noticed CINVANTI Patents.

On July 15, 2025, the Qilu CINVANTI and APONVIE litigations were consolidated. The Company entered into a settlement agreement with Qilu to resolve the ongoing patent litigation in the U.S. District Court for the District of Delaware related to Qilu’s ANDAs for generic versions of CINVANTI and APONVIE. In connection with the settlement, on November 3, 2025, the parties filed a Stipulation and Order of Dismissal with the U.S. District Court for the District of Delaware requesting that the Court dismiss the pending litigation between the parties.

ITEM 1A. RISK FACTORS

Investing in our common stock involves risks. We operate in a rapidly changing environment that involves a number of risks that could materially affect our business, financial condition or future results, some of which are beyond our control. In addition to the other information described below, the risks and uncertainties that we believe are most important for you to consider are discussed in Part I, Item 1A. "Risk Factors" in our 2024 Annual Report, Quarterly Reports on Form 10-Q, and other reports, including our financial statements and the related notes thereto, "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the information contained in the section entitled "Forward-Looking Statements." The occurrence of any of the events or developments described below could adversely our business, financial condition, results of operations and prospects. In such an event, the market price of our common stock could decline and you may lose all or part of your investment. Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our business operations. Other than the factors described below, there are no material changes to the risk factors described in the 2024 Annual Report.

Certain of the components used in the manufacture of our Products are, or might be, sourced from a single vendor, and the loss or disruption of this vendor could significantly harm our business.

Some of the critical materials and components used in manufacturing our Products are, or might be, sourced from single suppliers. An interruption in the supply of a key material could significantly delay our research and development process or increase our expenses for commercialization or development products. Specialized materials must often be manufactured for the first time for use in drug delivery technologies, or materials may be used in these technologies in a manner different from their customary commercial uses. The quality of materials can be critical to the performance of a drug delivery technology, so a reliable source that provides a consistent supply of materials is important. Materials or components needed for our drug delivery technologies may be difficult to obtain on commercially reasonable terms, particularly when relatively small quantities are required or if the materials traditionally have not been used in pharmaceutical products. Our reliance on a single vendor for certain components used in the manufacturing of our Products also subjects our business to risk associated with the geographic areas in which those single vendors reside, which could include natural or man-made disasters, including severe weather, epidemics, pandemics, acts of war or terrorism, armed conflict, resource shortages, or geopolitical instability, including as a result of increased tariffs and changing regulations and policies that may disrupt global markets or escalate tensions between countries. Such adverse events could cause global supply chain interruptions that could increase our costs and, to the extent such interruptions impair our ability to have sufficient inventory, cause us to lose revenue or market share. We continually evaluate our supply chains to identify potential risks and needs for additional manufacturers and other suppliers for the manufacturing of our Products. Establishing additional or replacement suppliers for certain raw materials in our proprietary polymers, if required, may not be accomplished quickly, or at all, and may involve significant expense. If we are able to find a replacement supplier, we would need to evaluate and qualify such replacement vendor and its ability to meet quality and compliance standards. Any change in suppliers or the manufacturing process for our Products could require additional regulatory approval and result in operational delays.

Some of our suppliers may experience disruption to their respective supply chains due to the adverse events or conditions, including the effects of a pandemic or disease outbreak, the imposition of tariffs and other trade protective measures, rising geopolitical tensions, armed conflict, regulatory and policy changes or other factors, which could delay, prevent or impair our development or commercialization efforts.

We obtain certain critical materials and components used in manufacturing our Products from third-party suppliers whose operations might be directly or indirectly affected by adverse events or conditions, including the effects of a pandemic or disease outbreak, the imposition of tariffs and other trade protective measures, rising geopolitical tensions and political instability, armed conflict, regulatory or policy changes, adverse weather conditions and public fears regarding any of the foregoing. For example, the recent increase in retaliatory tariffs between the U.S. and certain countries, most notably China, has escalated geopolitical tensions and may significantly disrupt the global markets and supply chains. Further, in recent years, tensions between mainland China and Taiwan have further escalated, with China accelerating the development of military capabilities and threatening the use of military force to gain control over Taiwan in certain circumstances. Similarly, the geopolitical conflicts in Russia and Ukraine and the Middle East remain unpredictable and could escalate into a broader armed conflict and additional economic sanctions or countermeasures by the affected countries or others, which could exacerbate market and economic instability. If we are unable to obtain these critical materials and components in sufficient quantities and in a timely manner, the manufacture, development, testing and clinical study of our Products might be delayed or infeasible, which could significantly harm our business.

Changes in government policies, laws, and regulations and with respect to the government workforce may have a negative impact on our business and the markets in which we operate.

The laws and regulations governing our operations, as well as their interpretation, may change from time to time, and new laws and regulations may be enacted. Similarly, operational changes at government agencies, including actions intended to reduce government spending at agencies that regulate significant parts of our business, such as the FDA and CMS, could have a significant impact on the implementation of laws and regulations that impact our business.

For example, the ~~recent~~ layoffs and reorganizations at several U.S. health agencies, including the FDA, the Department of Health and Human Services (the "HHS"), the Centers for Disease Control and Prevention and the National Institutes of Health, are expected to impact the FDA's ability to review and approve new medicines and conduct necessary inspections. Over the last several years, the U.S. government has also shut down several times and certain regulatory agencies, such as the FDA and SEC, have had to furlough critical employees and stop critical activities. In addition, government funding of agencies on which our operations may rely, including those that fund research and development activities, is subject to the political process, which is inherently fluid and unpredictable. Such disruptions at the FDA and other agencies may also increase the time necessary for new drugs or modifications to approved drugs to be reviewed and/or approved by necessary government agencies, which would adversely affect our business. There is also a great degree of uncertainty related to the impact of recent U.S. Supreme Court decisions and executive orders on the enforcement and decision-making authority of regulatory agencies, including those in the FDA, which may lead to delays, if not cancellations, of pending and proposed regulations at federal agencies and subject significant regulatory actions by the agencies to presidential supervision and control.

32Accordingly, any change in these laws or regulations, changes in their interpretation, or newly enacted laws or regulations and any failure by us to comply with these laws or regulations could require changes to certain of our business practices, negatively impact our operations, cash flow or financial condition, impose additional costs on us or otherwise adversely affect our business. For example, significant changes to U.S. trade policy, including potential new or increased tariffs, along with countermeasures by the affected countries, may impact global trade, create sourcing challenges with respect to raw materials and instruments and increase our costs, potentially harming our business. The U.S. has recently imposed increased tariffs on certain countries, focusing on those with which it has the largest trade deficits. Other countries have responded, and may continue to respond, by announcing retaliatory tariffs on U.S. imports. The tariffs have disrupted and may continue to disrupt the global markets and escalate geopolitical tensions between

orders on the enforcement and decision-making authority of regulatory agencies, including those in the FDA, which may lead to delays, if not cancellations, of pending and proposed regulations at federal agencies and subject significant regulatory actions by the agencies to presidential supervision and control.

Accordingly, any change in these laws or regulations, changes in their interpretation, or newly enacted laws or regulations and any failure by us to comply with these laws or regulations could require changes to certain of our business practices, negatively impact our operations, cash flow or financial condition, impose additional costs on us or otherwise adversely affect our business. For example, significant changes to U.S. trade policy, including potential new or increased tariffs, along with countermeasures by China, Mexico, the U.K., Canada, and parts of Europe, may impact global trade, create sourcing challenges with respect to raw materials and instruments and increase our costs, potentially harming our business. The U.S. has recently imposed increased tariffs on certain countries, focusing on those with which it has the largest trade deficits. Other countries have responded, and may continue to respond, by announcing retaliatory tariffs on U.S. imports. The tariffs have disrupted and may continue to disrupt the global markets and escalate geopolitical tensions between the U.S. and other countries. The extent of the impact of such tariffs and proposed regulations on our business specifically, or on the U.S. market and global economy generally, are uncertain and unpredictable, and could adversely affect our business, financial condition and results of operations. Further, the U.S. may also enact other regulations or policies that affect trade or otherwise impact the pharmaceutical industry by restricting U.S. pharmaceutical companies from contracting with certain countries for the development, research or manufacturing of pharmaceutical products. For example, the U.S. Department of Commerce initiated national security investigations into the importation of pharmaceuticals and pharmaceutical ingredients pursuant to Section 232 of the Trade Expansion Act of 1962, which could result in the imposition of new tariffs on imports within the pharmaceutical industry.

Moreover, uncertainty with respect to legislation, regulation and government policy at the federal, state and local levels, has introduced new and difficult-to-quantify macroeconomic and geopolitical risks with potentially far-reaching implications. There are currently a number of laws and regulations in the U.S. that have recently been adopted but not yet implemented, have been proposed or are being considered to which we or our customers may become subject, including healthcare reform initiatives and potential spending and tax proposals, but at this time their impact on our business and results of operations remains uncertain. Changes in legislation, regulation or policy increase the likelihood that we will fail to appropriately adapt to changes in our compliance obligations, particularly when such changes happen abruptly, such as following a change in government. Any of the foregoing changes could increase our litigation and regulatory exposure, directly impact our results of operations and cash flows, adversely affect our ability to provide our products, or adversely impact the demand for our Products. Such changes may also impact our business by creating increased volatility and uncertainty in the markets in which we operate. At this time, we cannot predict the ultimate content, timing, or effect of these changes, including any legislative, regulatory and other actions under the new U.S. administration, or estimate the overall impact of any such changes on our business, results of operations and financial condition.

If we cannot maintain satisfactory pricing of our Products that is also acceptable to the U.S. government, insurance companies, managed care organizations and other payors, or arrange for favorable reimbursement policies, our product sales may be adversely affected and our future revenue may suffer.

The continuing efforts of the U.S. government, insurance companies, managed care organizations and other payors of health care costs to contain or reduce costs of health care may adversely affect our ability to generate adequate revenues and gross margins to make our Products commercially viable. Our ability to commercialize our Products successfully will depend in part on the extent to which governmental authorities, private health insurers and other organizations establish appropriate reimbursement levels for the cost of such products and related treatments and for what uses reimbursement will be provided.

Adoption of our Products by the medical community may be limited if third-party payors will not offer adequate coverage. In addition, third-party payors often challenge the price and cost-effectiveness of medical products and services, and such pressure may increase in the future. In many cases, uncertainty exists as to the adequate reimbursement status of newly approved healthcare products. Accordingly, our Products may not be considered cost-effective and adequate third-party reimbursement may not be available to enable us to maintain price levels sufficient to realize a profit. Further, coverage policies and third-party payor reimbursement rates may change at any time. Even if favorable coverage and reimbursement status is attained for one or more of our Products or product candidates for which we receive regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future.

Legislation and regulations affecting the pricing of pharmaceuticals may change and any such changes could further limit reimbursement. Cost control initiatives may decrease coverage and payment levels for our Products and, in turn, the reimbursement

that we receive. We are unable to predict all changes to the coverage or reimbursement methodologies that will be applied by private or government payors to our Products. If our Products do not receive adequate reimbursement, our revenue could be severely limited.

In the U.S., given recent federal and state government initiatives directed at lowering the total cost of health care, the U.S. Congress and state legislatures will likely continue to focus on health care reform, reducing the cost of prescription pharmaceuticals and reforming the Medicare and Medicaid systems. The Patient Protection and Affordable Care Act of 2010, as amended by the Health Care and Education Affordability Reconciliation Act (collectively, the "PPACA") has resulted in sweeping changes to broaden access to health insurance, reduce or constrain the growth of healthcare spending, enhance remedies against fraud and abuse, add new transparency requirements for the healthcare and health insurance industries, impose taxes and fees on the health industry and impose additional health policy reforms. Since its enactment, there have been judicial, executive and Congressional challenges to certain aspects of the ACA. The OBBBA has enacted, among others, changes to eligibility requirements for premium tax credits, which is expected to result in less coverage in the ACA's health insurance marketplace ("Marketplace") over the next few years. The ACA premium tax credits will expire at the end of 2025, which is expected to result in an additional loss of coverage for approximately 24 million people currently enrolled in insurance plans obtained through the Marketplace. In addition, the OBBBA has made other changes to the enrollment and eligibility requirements for Medicaid, which is expected to result in the loss of coverage for certain individuals currently enrolled in Medicaid programs.

The SUPPORT Act of 2018 established policies to encourage the prevention and treatment of opioid addiction and the development of non-opioid pain management treatments. Due to the SUPPORT Act, Medicare pays separately for certain non-opioid pain management drugs in ambulatory surgical centers ("ASC") but not in the hospital outpatient setting ("OPPS"). However, under the Consolidated Appropriations Act of 2023, the prior payment policy was replaced by a new three-year period of separate payment for non-opioid pain relief products in the OPPS and ASC settings for 2025 through 2027. As of January 1, 2025, Medicare has implemented this new payment methodology, which remains in effect through December 31, 2027. For 2025, ZYNRELEF is included in this new policy, effective April 1, which means continued separate Medicare payment in the OPPS and ASC settings. While this change may improve access to ZYNRELEF, it may also lead to greater competition.

The American Rescue Plan Act of 2021 removed the statutory cap on rebates that manufacturers pay to state Medicaid programs pursuant to the Medicaid Drug Rebate Program. The Infrastructure Investment and Jobs Act of 2021 also included a provision requiring drug manufacturers to pay CMS a refund for certain amounts of Part B drugs that are discarded from a single-dose container or single-use package. Under the law, and a CMS Proposed Rule issued in July 2022, this refund program became effective on January 1, 2023. Neither of these pieces of legislation have had a material impact on the Company, through December 31, 2024.

Further, the Inflation Reduction Act of 2022 ("IRA"), includes various provisions intended to address drug-pricing issues, which requires manufacturers to engage in the drug price negotiation program with Medicare (beginning in 2026) or face steep penalties if they don’t agree to provide their drug at the government-set price subject to a cap; imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation; establishes an out-of-pocket maximum for beneficiaries in Part D; and replaces the Part D coverage gap discount program with a new discounting program. To date, CMS has selected ten Medicare Part D drugs with prices to go into effect on January 1, 2026 and another 15 Part D drugs with prices to go into effect on January 1, 2027. Another 15 drugs from Medicare Part B or Medicare Part D will be selected by February 1, 2026, for the maximum price to be set and in effect by January 1, 2028. If any of our approved products are subject to price negotiations, it could, among other things, lead to lower revenues prior to the expiry of intellectual property protections.

In addition, developments in Medicare hospital outpatient reimbursement for 340B-acquired drugs may further drive 340B hospital business for Heron. The 340B program allows certain hospitals and safety net providers to purchase Part B outpatient drugs from manufacturers at federally mandated discounted rates. Due to the June 2022 Supreme Court decision in American Hospital Association et al. v. Becerra et al, since January 1, 2023, the Medicare Part B hospital outpatient payment rate for 340B-acquired drugs has returned to being at the same rate as the rate for non-340B hospitals, Average Selling Price (ASP) + 6% methodology.

We expect that other healthcare reform measures that may be adopted in the future may result in additional reductions in Medicare and other healthcare funding, more rigorous coverage criteria, new payment methodologies and additional downward pressure on drug prices, which may affect prices of our Products in the future. Any reduction in reimbursement from Medicare or other government programs may result in a similar reduction in payments from private payors. The implementation of cost containment measures or other healthcare reforms may prevent us from being able to price our Products at what we consider to be a fair or competitive price, generate revenue, attain profitability, or commercialize our product candidates, if approved.

Moreover, there has recently been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products. Economic pressure on state budgets have resulted in states increasingly seeking to achieve budget savings through mechanisms that limit coverage or payment for drugs. For example, individual states in the U.S. have become increasingly active in implementing regulations through state Pharmacy Drug Review Boards designed to contain drug pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures. State Medicaid programs are increasingly asking manufacturers to pay supplemental rebates and requiring prior authorization by the state program for use of any drug for which supplemental rebates are not being paid. Regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs. In addition, the trend toward managed health care in the U.S., which could significantly influence the purchase of health care services and products, may result in lower prices for our Products.

Further, executive orders were signed to implement Most Favored Nation drug pricing policies designed to align certain prescription drug prices in the U.S. to lower prices available in other countries. Investigations are being conducted to examine price differentials and consider policy approaches for implementation, including through administrative action. If such Most Favored Nation policies are implemented, changes to drug pricing are expected to affect the profitability of pharmaceutical and biotech companies in the U.S. as well as in other countries, as a price referencing policy to the U.S. market could make it commercially unviable to commercialize a drug product in a price constrained market. The details of the proposed policies are unclear and the final terms and impact remain uncertain, and may pose long-term risks to our business and our future commercialization plans of our Products and product candidates.

While we cannot predict the impact of such legislative or regulatory changes on our business, the announcement or adoption of these proposals could have a material and adverse effect on our potential revenues and gross margins.

Changes to existing tax laws, or challenges to our tax positions could adversely affect our business and financial condition.

The tax regimes to which we are subject or under which we operate may be subject to significant change. There is uncertainty regarding future legislative and regulatory changes and policies related to matters such as taxation and importation, and any such proposed or enacted regulations by the current or a future U.S. administration, Congress, or taxing authorities in other jurisdictions could materially affect our tax obligations and operating results.

For example, beginning in 2022, the Tax Cuts and Jobs Act of 2017 eliminated the option to deduct research and development expenditures in the year incurred and instead requires taxpayers to capitalize and subsequently amortize such expenditures over five years for research activities conducted in the U.S. and over 15 years for research activities conducted outside the U.S. The One Big Beautiful Bill Act ("OBBBA") reinstates the option to deduct domestic research and development expenditures in the year incurred, commencing with tax years beginning after December 31, 2024. Foreign research and development expenditures remain subject to the 15-year capitalization and amortization requirement. The OBBBA also includes other significant provisions, including tax cut extensions and modifications to the international tax framework. While we continue to evaluate the impact of these legislative changes as additional guidance becomes available, uncertainty remains regarding the timing and interpretation by tax authorities in affected jurisdictions. To the extent that such changes have a negative impact on us, including as a result of related uncertainty, these changes could adversely impact our business, results of operations and financial position.

In addition, U.S. federal, state and local tax laws are extremely complex and subject to various interpretations. Although we believe that our tax estimates and positions are reasonable, there can be no assurance that our tax positions will not be challenged by relevant tax authorities. If the relevant tax authorities assess additional taxes on us, this could result in adjustments to, or impact the timing or amount of, taxable income, deductions or other tax allocations, which may adversely affect our results of operations and financial position.

the U.S. and other countries. The extent of the impact of such tariffs and proposed regulations on our business specifically, or on the U.S. market and global economy generally, are uncertain and unpredictable, and could adversely affect our business, financial condition and results of operations. Further, the U.S. may also enact other regulations or policies that affect trade or otherwise impact the pharmaceutical industry by restricting U.S. pharmaceutical companies from contracting with certain countries for the development, research or manufacturing of pharmaceutical products. For example, the U.S. Department of Commerce initiated national security investigations into the importation of pharmaceuticals and pharmaceutical ingredients pursuant to Section 232 of the Trade Expansion Act of 1962, which could result in the imposition of new tariffs on imports within the pharmaceutical industry.

In addition, the U.S. announced a 100% tariff, effective October 1, 2025, on any branded or patented pharmaceuticals imported into the U.S., unless the relevant drug manufacturer has or is in the process of building a manufacturing facility in the U.S. The imposition of such tariffs is currently delayed as the U.S. administration seeks to negotiate drug pricing agreements with large drug manufacturers. The outcome of such ongoing negotiations is currently unclear and the final terms and impact remain uncertain. While we currently do not anticipate a material impact from such tariffs on our business or operations, such tariffs could have implications on drug pricing, drug production levels and patient access, and may result in supply chain or other operational disruptions. Further, if we are required to change our current manufacturing partners or suppliers now or in the future in order to avoid such tariffs, the terms of new agreements that we may enter into may not be favorable to us and related operational disruptions may heighten manufacturing and compliance risks and derail commercialization plans.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

Rule 10b5-1 Trading Plans

During the three months ended ~~June~~September 30, 2025, no new Rule 10b5-1 trading arrangements (as defined in Item 408(a)(1)(i) of Regulation S-K) and non-Rule 10b5-1 trading arrangements (as defined in Item 408(c) of Regulation S-K) intended to satisfy the affirmative defense of Rule 10b5-1(c) of the Exchange Act were adopted or terminated by our directors and/or executive officers (as defined in Section 16 of the Exchange Act).

During the three months ended ~~June~~September 30, 2025, the Company did not adopt or terminate a Rule 10b5-1 trading arrangement (as defined in Item 408(a)(1)(i) of Regulation S-K).

3637

ITEM 6. EXHIBITS

The exhibits listed on the Exhibit Index hereto are filed or furnished (as stated therein) as part of this Quarterly Report on Form 10‑Q.

ExhibitNumber		Description
10.1+*		Amendment No. 3 to Co-Promotion Agreement, dated as of January 5, 2024, by and between the Company and CrossLink Network, LLC
3.1		Certificate of Designation of Rights, Preferences and Privileges of Series A Convertible Preferred Stock of Heron Therapeutics, Inc., filed with the Secretary of State of the State of Delaware on August 11, 2025 (incorporated by reference to our Current Report on Form 8-K, as Exhibit 3.1, filed on August 12, 2025)
10.2+*		Amendment No. 4 to Co-Promotion Agreement, dated as of January 5, 2024, by and between the Company and CrossLink Network, LLC
3.2		Certificate of Designation of Series B Preferred Stock of Heron Therapeutics, Inc., filed with the Secretary of State of the State of Delaware on August 14, 2025 (incorporated by reference to our Current Report on Form 8-K, as Exhibit 3.1, filed on August 15, 2025
10.3+†		Management Retention Agreement, dated April 28, 2025, by and between the Company and Mark Hensley
4.1		Form of Convertible Senior Unsecured Promissory Note due 2031 (included in Exhibit 10.6)
10.4+*		Amendment No. 5 to Co-Promotion Agreement, dated as of January 5, 2024, by and between the Company and CrossLink Network, LLC
4.2		Tax Benefit Preservation Plan, dated August 14, 2025, by and between Heron Therapeutics, Inc. and Computershare Trust Company N.A., which includes the Form of Certificate of Designation of Series B Preferred Stock as Exhibit A, Form of Right Certificate as Exhibit B and the Summary of Rights to Purchase Preferred Shares as Exhibit C (incorporated by reference to our Current Report on Form 8-K, as Exhibit 4.1, filed on August 15, 2025)
10.1+*		Framework Agreement, dated August 6, 2025, by and between Heron Therapeutics, Inc. and Patheon Austria GmbH & Co KG
10.2		Cooperation Agreement, dated August 8, 2025, by and among Heron Therapeutics, Inc. and Rubric Capital Management L.P. (incorporated by reference to our Current Report on Form 8-K, as Exhibit 10.1, filed on August 12, 2025)
10.3*		Second Amendment to Working Capital Facility Agreement, dated August 8, 2025, by and between Heron Therapeutics, Inc. and Hercules Capital, Inc., as administrative agent, collateral agent, and lender (incorporated by reference to our Current Report on Form 8-K, as Exhibit 10.2, filed on August 12, 2025)
10.4*		Exchange Agreement, dated August 8, 2025, by and among Heron Therapeutics, Inc. and the holders party thereto (incorporated by reference to our Current Report on Form 8-K, as Exhibit 10.3, filed on August 12, 2025)
10.5		Securities Purchase Agreement, dated August 8, 2025, by and among Heron Therapeutics, Inc. and the purchasers party thereto (incorporated by reference to our Current Report on Form 8-K, as Exhibit 10.5, filed on August 12, 2025)
10.6		Note Purchase Agreement, dated August 8, 2025, by and among Heron Therapeutics, Inc. the purchasers party from time to time thereto and Rubric Capital Management LP (incorporated by reference to our Registration Statement on Form S-3, as Exhibit 10.1, filed on September 9, 2025)
10.7+*		Office Lease Agreement, dated August 22, 2025, by and between Heron Therapeutics, Inc. and USEF HCG Fenton LLC
10.8+*		Amendment No. 6 to Co-Promotion Agreement, dated as of August 15, 2025, by and between the Company and Crosslink Network, LLC
31.1+		Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2+		Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1++		Certifications of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS		XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		Inline XBRL Extension Definition
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (embedded within the Inline XBRL document included as Exhibit 101)


101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document

104		Cover Page Interactive Data File (embedded within the Inline XBRL document included as Exhibit 101)

+ Filed herewith

++ Furnished herewith

* Certain information has been omitted from the exhibit in compliance with Item 601(b)(10) of Regulation S-K. The omitted information is not material and would likely cause competitive harm to the Company if publicly disclosed.

† Management contract or compensatory plan, contract or arrangement.

3739

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		Heron Therapeutics, Inc.
Date: August 8, 2025	By:	/s/ Craig Collard
Date: November 4, 2025	By:	/s/ Craig Collard
		Craig Collard
		Chief Executive Officer
		(Principal Executive Officer)
	By:	/s/ Ira Duarte
		Ira Duarte
		Executive Vice President, Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

3840

For the quarterly period ended JuneSeptember 30, 2025

For the transition period from _______ to _______

HERON THERAPEUTICS, INC.

Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income

Condensed Consolidated Statements of Stockholders' Equity (Deficit)

Condensed Consolidated Statements of Cash Flows

SIGNATURES

For the transition period from _ to _

Filing Compare · HERON THERAPEUTICS, INC. /DE/