asrt-20230630

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 JUNE 30, 2023

☐ 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 001-39294

ASSERTIO HOLDINGS, INC.

(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)


Delaware			85-0598378
(STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION)			(I.R.S. EMPLOYER IDENTIFICATION NUMBER)

100 South Saunders Road, Suite 300

Lake Forest, Illinois 60045

(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES; ZIP CODE)

(224) 419-7106

(REGISTRANT’S TELEPHONE NUMBER, INCLUDING AREA CODE)

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, $0.0001 par value

ASRT

The Nasdaq Stock Market LLC

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 issued and outstanding shares of the registrant’s Common Stock, $0.0001 par value, as of July 31, 2023 was 56,516,661. Amount excludes shares of the registrant’s Common Stock issued as a result of the acquisition of Spectrum Pharmaceuticals, Inc., which closed on July 31, 2023 (refer to Note 17 to the Condensed Consolidated Financial Statements included herein).

ASSERTIO HOLDINGS, INC.

FORM 10-Q FOR THE PERIOD ENDED JUNE 30, 2023

TABLE OF CONTENTS




PART I — FINANCIAL INFORMATION

Item 1.						Financial Statements (unaudited)

						Condensed Consolidated Balance Sheets at June 30, 2023 and December 31, 2022

						Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2023 and 2022

						Condensed Consolidated Statements of Shareholders’ Equity for the three and six months ended June 30, 2023 and 2022

						Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2023 and 2022

						Notes to Condensed Consolidated Financial Statements

Item 2.						Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 3.						Quantitative and Qualitative Disclosures About Market Risk

Item 4.						Controls and Procedures

PART II — OTHER INFORMATION

Item 1.						Legal Proceedings

Item 1A.						Risk Factors

Item 2.						Unregistered Sales of Equity Securities and Use of Proceeds

Item 6.						Exhibits

						Signatures

PART I — FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ASSERTIO HOLDINGS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)


	(Unaudited)
	June 30, 2023		December 31, 2022
ASSETS
Current assets:
Cash and cash equivalents	$	70,175	$	64,941
Accounts receivable, net	41,608		45,357
Inventories, net	18,817		13,696
Prepaid and other current assets	2,949		8,268
Total current assets	133,549		132,262
Property and equipment, net	877		744
Intangible assets, net	185,428		197,996
Deferred tax asset	81,587		80,202
Other long-term assets	3,738		2,709
Total assets	$	405,179	$	413,913
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	11,182	$	5,991
Accrued rebates, returns and discounts	42,857		49,426
Accrued liabilities	10,283		12,181
Long-term debt, current portion	—		470
Contingent consideration, current portion	14,900		26,300
Other current liabilities	256		948
Total current liabilities	79,478		95,316
Long-term debt	38,251		66,403
Contingent consideration	27,600		22,200
Other long-term liabilities	5,579		4,269
Total liabilities	150,908		188,188
Commitments and contingencies (Note 12)
Shareholders’ equity:
Common stock, $0.0001 par value, 200,000,000 shares authorized; 56,512,962 and 48,319,838 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively.	5		5
Additional paid-in capital	568,881		545,321
Accumulated deficit	(314,615)		(319,601)
Total shareholders’ equity	254,271		225,725
Total liabilities and shareholders' equity	$	405,179	$	413,913

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

ASSERTIO HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands, except per share data)

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Revenues:
Product sales, net	$	40,083	$	35,430	$	81,852	$	70,977
Royalties and milestones	723		451		1,420		1,443
Other revenue	185		(750)		185		(750)
Total revenues	40,991		35,131		83,457		71,670
Costs and expenses:
Cost of sales	4,772		4,528		10,239		8,723
Research and development expenses	503		—		503		—
Selling, general and administrative expenses	16,771		10,543		33,675		21,184
Change in fair value of contingent consideration	241		1,300		9,408		2,945
Amortization of intangible assets	6,284		7,969		12,568		16,469
Total costs and expenses	28,571		24,340		66,393		49,321
Income from operations	12,420		10,791		17,064		22,349
Other (expense) income:
Debt-related expenses	—		—		(9,918)		—
Interest expense	(751)		(2,269)		(1,873)		(4,596)
Other gain (loss)	661		(95)		1,463		451
Total other expense	(90)		(2,364)		(10,328)		(4,145)
Net income before income taxes	12,330		8,427		6,736		18,204
Income tax expense	(3,860)		(593)		(1,750)		(1,306)
Net income and comprehensive income	$	8,470	$	7,834	$	4,986	$	16,898

Basic net income per share	$	0.15	$	0.17	$	0.09	$	0.37
Diluted net income per share	$	0.13	$	0.16	$	0.09	$	0.36
Shares used in computing basic net income per share	56,142		46,274		53,588		45,746
Shares used in computing diluted net income per share	70,144		47,579		58,010		46,857

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

ASSERTIO HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(in thousands)

(Unaudited)


	Common Stock			Additional Paid-In Capital		Accumulated Deficit		Shareholders’ Equity
	Shares	Amount












Balances at March 31, 2023	55,662	$	5	$	573,744	$	(323,085)	$	250,664
Issuance of common stock upon exercise of options	110	—		157		—		157
Common stock issuance and other impacts of the vesting and settlement of equity awards	741	—		(7,225)		—		(7,225)
Stock-based compensation	—	—		2,205		—		2,205
Net income and comprehensive income	—	—		—		8,470		8,470
Balances at June 30, 2023	56,513	$	5	$	568,881	$	(314,615)	$	254,271

SEC Form 10-Q filed by Assertio Holdings Inc.