Cumberland Pharmaceuticals Inc.
11/07/2025 | Press release | Distributed by Public on 11/07/2025 16:06
Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)
Management's Discussion and Analysis of Financial Condition and Results of Operations
Disclosure regarding forward-looking statements
The following discussion contains certain forward-looking statements which reflect management's current views of future events and operations. These statements involve certain risks and uncertainties, and actual results may differ materially from them. Forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Actual results may differ significantly from the results discussed in these forward-looking statements. Some important factors which may cause results to differ from expectations include: availability of additional debt and equity capital; market conditions at the time additional capital is required; our ability to continue to acquire branded products; product sales; management of our growth and integration of our acquisitions and generally unpredictable conditions in national and international markets. While forward-looking statements reflect our beliefs and best judgment based upon current information, they are not guarantees of future performance. Other important factors that may cause actual results to differ materially from forward-looking statements are discussed in the sections entitled "Risk Factors" and "Special Note Regarding Forward-Looking Statements" of our Annual Report on Form 10-K for the year ended December 31, 2024, and our other filings with the SEC. We do not undertake to publicly update or revise any of our forward-looking statements, even in the event that experience or future changes indicate that the anticipated results will not be realized. The following presentation of management's discussion and analysis of financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes included in this report on Form 10-Q.
OVERVIEW
Our Business
Cumberland Pharmaceuticals Inc. ("Cumberland," the "Company," or as used in the context of "we," "us," or "our"), is a specialty pharmaceutical company focused on the acquisition, development and commercialization of branded prescription pharmaceuticals. We are dedicated to our mission of working together to provide unique products that improve the quality of patient care.
Our primary target markets are hospital acute care, gastroenterology and oncology. These medical specialties are characterized by relatively concentrated prescriber bases that we believe can be served effectively by small, targeted sales forces. We promote our approved products through our hospital, field and oncology sales divisions in the United States. We have built a network of established international partners with the needed regulatory and commercial capabilities to register and provide our medicines to patients in their countries.
Our portfolio of brands approved for marketing by the U.S. Food and Drug Administration ("FDA") includes:
•Acetadote® (acetylcysteine) injection, for the treatment of acetaminophen poisoning;
•Caldolor® (ibuprofen) injection, for the treatment of pain and fever;
•Kristalose® (lactulose) oral solution, a prescription laxative for the treatment of constipation;
•Sancuso® (granisetron) transdermal, for the prevention of nausea and vomiting in patients receiving certain types of chemotherapy treatment;
•Vaprisol®(conivaptan) injection, to raise serum sodium levels in hospitalized patients with euvolemic and hypervolemic hyponatremia;
•Vibativ®(telavancin) injection, for the treatment of certain serious bacterial infections including hospital-acquired and ventilator-associated bacterial pneumonia, as well as complicated skin and skin structure infections; and
•Talicia® (omeprazole magnesium, amoxicillin and rifabutin) oral capsule, for the treatment of H. pyloriinfection.
In addition to these commercial brands, we have announced breakthrough results in clinical study of our ifetroban product candidate in patients with cardiomyopathy associated with Duchenne muscular dystrophy ("DMD"). This rare, fatal genetic neuromuscular disease results in deterioration of the skeletal, heart and lung muscles. We then completed and submitted a clinical study report to the FDA and began interactions to determine their remaining development requirements.
We also have Phase II clinical programs underway evaluating our ifetroban product candidate in patients with 1) Systemic Sclerosis ("SSc") or scleroderma, a debilitating autoimmune disorder characterized by diffuse fibrosis of the skin and internal organs and 2) Idiopathic Pulmonary Fibrosis ("IPF"), the most common form of progressive fibrosing interstitial lung disease. Investigational new study applications have been cleared by the FDA enabling us to launch clinical studies in each of these areas.
Cumberland has built core competencies for the acquisition, development and commercialization of pharmaceutical products in the U.S., and we can leverage this existing infrastructure to support our continued growth. Our management team consists of pharmaceutical industry veterans with experience in business development, product development, regulatory, manufacturing, sales, marketing and finance.
Our business development team identifies, evaluates and negotiates product acquisition, licensing and co-promotion arrangements. Our product development team creates proprietary formulations, manages our clinical studies, prepares our FDA submissions and staffs our medical call center. Our quality and manufacturing professionals oversee the manufacturing, release and shipment of our brands. Our marketing and sales organization is responsible for our commercial activities, and we work closely with our distribution partners to ensure the availability and delivery of our products.
GROWTH STRATEGY
Cumberland's growth strategy involves maximizing the potential of our existing brands, while continuing to build a portfolio of differentiated products. We currently own rights to seven products approved by the FDA in the United States. We are also building international partnerships to bring our medicines to patients in other countries.
Additionally, we look for opportunities to expand our brands into new patient populations through clinical trials, new product presentations and our support of select, investigator-initiated studies. Meanwhile, our clinical team is developing a pipeline of new product candidates to address poorly met medical needs. We also pursue opportunities to acquire additional marketed brands, as well as late-stage development product candidates in our target medical specialties.
We are supplementing these activities with the earlier-stage product development at Cumberland Emerging Technologies ("CET"), our majority-owned subsidiary. CET partners with academic research institutions to identify and support the progress of promising new product candidates, which Cumberland can further develop and commercialize.
Specifically, we are seeking long-term, sustainable growth by:
•Supporting and expanding the use of our marketed products. We continue to evaluate our products following their FDA approval, to determine if additional clinical data could expand their market and use. For example, we have secured pediatric approval of Acetadote and Caldolor and expanded the labeling for both brands accordingly. We also added pre-surgery dosing for Caldolor, and more recently included newborns to the patients who can benefit from the product.
•Selectively adding complementary brands.In addition to our product development activities, we are also seeking to acquire approved brands or late-stage development product candidates to continue to build our portfolio. We seek under-promoted, FDA-approved drugs as well as late-stage development products that can improve patient care. We will continue to target product acquisition candidates that are competitively differentiated and have valuable intellectual property or other protective features. Our acquisitions of Vibativ and Sancuso are examples of the implementation of this strategy.
•Progressing our clinical pipeline and incubating future product opportunities at CET.We believe it is important to build a pipeline of innovative new product opportunities, as we are doing through our ifetroban Phase II development programs. We are also supplementing our acquisitions and late-stage development activities with the early-stage product development activities at CET.
•Leveraging our infrastructure through co-promotion partnerships.We believe that our commercial infrastructure can help drive prescription volume and product sales. We also look for select partners that can complement our capabilities and enhance opportunities for our brands. For example, our co-promotion partnerships have allowed us to expand the support for Kristalose across the United States.
•Building an international contribution to our business. We hold the worldwide rights to all our brands except for Sancuso, as we acquired only the U.S. rights for that product. We have established our own commercial capabilities, including three sales divisions, that focus on the U.S. market for our products. We are also working with a network of established international partners to register our products and make them available to patients in their countries. We will continue to support our partners' registration and commercialization efforts in their respective territories. The acquisition of Vibativ resulted in several new international partners and market opportunities.
•Managing our operations with financial discipline.We continually work to manage our expenses in line with our revenues, to deliver positive cash flow from operations. We seek to maintain favorable gross margins and a strong balance sheet.
RECENT DEVELOPMENTS
New Product Added to Commercial Product Portfolio
We recently announced arrangements with RedHill Biopharma Ltd. ("RedHill") to jointly commercialize Talicia®, adding the brand to our commercial product portfolio. The FDA-approved oral capsule is indicated for the treatment of Helicobacter pylori(H. pylori) infection in adults, a bacterial infection and leading risk factor for gastric cancer. Talicia net revenues were $8 million in 2024.
We have formed a new company with RedHill named Talicia Holdings, Inc. RedHill has assigned all its Talicia related assets to the new company for a 70% ownership position. Cumberland will provide $4 million in investment capital over a two-year period and receive ownership of the 30% remaining shares. Cumberland and RedHill have equal board seats and voting rights in the new company, and these arrangements will enable Cumberland to participate in the value it helps create in the brand. RedHill has also assigned to the new company the international rights to Talicia including existing international licensing agreements, and Cumberland will therefore also benefit from those arrangements, through its 30% ownership.
Through a co-commercialization agreement, we will assume responsibility for the distribution and sale of Talicia in the U.S. Cumberland will record Talicia product sales and equally share Talicia's net revenues. We will also provide an annual investment of up to $2 million to cover certain distribution, marketing and sales costs. Cumberland will lead the sales promotion for Talicia and will leverage our established field national sales division, which has been detailing Kristalose, to increase the number of patients benefiting from Talicia. The new company will provide operational support with responsibility for the product's marketing, manufacturing, regulatory and supply chain functions.
Talicia is the only all-in-one treatment containing omeprazole, amoxicillin and rifabutin, and is now recommended as a first-line therapy in the American College of Gastroenterology(ACG) clinical guidelines. Talicia is patent protected through 2042 and received eight years of U.S. market exclusivity under its Qualified Infectious Disease Product (QIDP) designation.
International Agreements
During the third quarter of 2025, we announced the launch of Vibativ®in Saudi Arabia. The product launch follows an agreement with Tabuk Pharmaceutical Manufacturing Company to introduce Vibativ into the Middle East. The arrangement provided Tabuk exclusive rights to distribute Vibativ in Saudi Arabia and Jordan, with the option to expand into other countries in the region. Tabuk has obtained the final approvals needed to commercialize Vibativ in Saudi Arabia.
In October 2025, our ibuprofen injection product received regulatory approval in Mexico. We previously announced our partnership with PiSA Farmaceutica, a well-established Mexican pharmaceutical firm. Under the agreement, PiSA is provided with the exclusive supply and distribution rights for the ibuprofen product in the Mexican market while Cumberland provides regulatory and manufacturing support. PiSA plans to introduce the product in 800 mg vials, making it accessible for a variety of clinical uses in Mexican healthcare facilities.
Additionally, we previously announced that Vibativ received approval from the regulatory authorities in China. That milestone provides us with access to the world's second-largest pharmaceutical market, and we look forward to the launch of our product there.
Vibativ®4-Vial Starter Pak Now Available for Vizient Providers
Earlier this year, we announced the availability of the Vibativ (telavancin) 4-Vial Starter Pak through a new supply arrangement with Vizient Inc., making it accessible to their healthcare providers nationwide.
As the country's largest provider-driven health care performance improvement company, Vizient serves more than 65% of the nation's acute care providers, including 97% of academic medical centers and 35% of the non-acute market. Through this agreement, Vizient members now have access to Vibativ's new 4-vial configuration, which supports flexible treatment initiation in both inpatient and outpatient settings for this potentially life-saving therapy.
Vibativ®Added to Premier National Group Purchasing Agreement
In October 2025, we announced that Vibativ was added to a national group purchasing agreement with Premier, Inc. The product addition allows Premier members to purchase Vibativ, in the 12-vial carton and 4-vial Starter Pak. Premier is a leading healthcare improvement company, uniting an alliance of approximately 4,350 U.S. hospitals and 325,000 other providers and organizations. With expanded access, Premier member healthcare providers now have greater flexibility in ordering Vibativ for both inpatient and outpatient settings.
Ifetroban Clinical Studies
This year, we announced positive top-line results from our FIGHT DMD clinical trial. The study evaluated ifetroban, a novel oral therapy for Duchenne muscular dystrophy (DMD) heart disease - the leading cause of death in DMD patients. It marks a breakthrough for these patients, as it is the first successful Phase 2 study specifically targeting the cardiac complications of their condition. Ifetroban has been studied in over 1,400 subjects across multiple clinical trials, demonstrating a well-established safety profile.
The trial enrolled 41 DMD patients who received either low dose ifetroban (150 mg per day), high dose ifetroban (300 mg per day) or placebo. The study's primary endpoint was an improvement in the heart's left ventricular ejection fractions (LVEF). Key findings included:
•High dose ifetroban treatment resulted in an overall 3.3% improvement in LVEF;
•The high dose ifetroban group showed an increase in 1.8% in LVEF, while the study placebo group showed an expected decline in LVEF of 1.5%;
•When compared with propensity matched natural history controls, the difference was even more pronounced, with the high dose treatment providing a significant 5.4% overall improvement in LVEF, as the control patients experienced a 3.6% decline in LVEF; and
•Both doses of ifetroban were well-tolerated, with no serious drug-related events.
The top-line findings from our FIGHT DMD study were featured as a late-breaking presentation at the Muscular Dystrophy Association's Clinical & Scientific Conference in March 2025 and subsequently presented at the Parent Project Muscular Dystrophy Annual Conference in June 2025. Following these presentations, we completed our comprehensive analysis and submitted the clinical study report to the FDA with a request for an end-of-Phase 2 meeting. This meeting took place in September 2025, where we discussed remaining clinical development and manufacturing requirements. The FDA has recommended a follow-up meeting, which we are currently planning.
Meanwhile, we have been evaluating our ifetroban product candidate in a Phase II clinical program in patients with Systemic Sclerosis (SSc) or scleroderma. Enrollment in the study was completed this year, and we are monitoring the clinical sites in preparation to lock the database and begin evaluating the results. We look forward to announcing top-line findings from this study this year. In addition, we have a Phase II clinical study, the FIGHTING FIBROSIS™ trial, underway in patients with Idiopathic Pulmonary Fibrosis, the most common form of progressive fibrosing interstitial lung disease. Patient enrollment is now well underway in medical centers across the U.S. The study design includes both an interim safety analysis, as well as an interim efficacy analysis.
We have also completed a pilot Phase II study involving 1) patients suffering from Hepatorenal Syndrome, a life-threatening condition involving liver and kidney failure, 2) patients with Portal Hypertension associated with chronic liver disease and 3) patients with Aspirin-Exacerbated Respiratory Disease, a severe form of asthma. There was no significant safety issues identified with the use of ifetroban in these patients. Additional pilot studies of ifetroban are underway, through several investigator-initiated trials. Following completion of our ongoing studies and FDA feedback, we will determine the optimal regulatory pathways for ifetroban, our first new chemical entity.
Competition
The pharmaceutical industry is characterized by intense competition and rapid innovation. Our continued success in developing and commercializing pharmaceutical products will depend, in part, upon our ability to compete against existing and future products in our target markets. Competitive factors directly affecting our markets include but are not limited to:
• product attributes such as efficacy, safety, ease-of-use and cost-effectiveness;
• brand awareness and recognition driven by sales, marketing and distribution capabilities;
• intellectual property and other exclusive rights;
• availability of resources to build and maintain developmental and commercial capabilities;
• successful business development activities;
• extent of third-party reimbursements, insurance coverage; and
• establishment of advantageous collaborations to conduct development, manufacturing or commercialization efforts.
Our products face competition from other branded products, generics and alternate medical treatments. Our task is to position each brand to feature its competitive advantages, implement a well-thought-out marketing plan and provide focused sales, field-based medical and other tactical support.
Kristalose is a dry powder crystalline prescription formulation of lactulose indicated for the treatment of constipation. The U.S. constipation therapy market includes various prescription and over the counter, or OTC, products. There are several branded prescription products which we believe are our primary competitors including Amitiza®, Movantik®, Linzess®and Vibrant®.
There are several hundred OTC products used to treat constipation marketed by numerous pharmaceutical and consumer health companies. MiraLax®(polyethylene glycol 3350), previously a prescription product, was indicated for the treatment of constipation and manufactured and marketed by Bayer. MiraLax was converted to an OTC product and as a result the FDA rescinded the approval of the generic prescription polyethylene glycol 3350 products.
There are also other lactulose products available in the U.S. including Constulose, Enulose and Generalac, as well as several generics. Prescriptions for our Kristalose product are often substituted and filled by one of these generic products. During the first quarter of 2025, a generic crystalline lactulose product was approved for PAI Pharma, and the product became available during the second quarter of the year.
Tariffs
The United States and other countries have recently begun imposing new tariffs on international trade. While pharmaceuticals have been largely exempt from these recently imposed U.S. tariffs, such exemptions may be removed in the future. We continue to monitor and evaluate the impact of tariffs on our business and the results of our operations.
Summary
We have entered an exciting time for our Company. We remain in the early stages of capitalizing on numerous opportunities and expect our momentum to continue. Our ongoing success can be driven by growth from our approved brands, expanded international partnerships, progress in our clinical development programs and the potential addition of select acquisitions. We will remain focused on our efforts and look forward to future opportunities to carry out our mission and report on our progress throughout the remainder of the year and beyond.
CRITICAL ACCOUNTING POLICIES AND SIGNIFICANT JUDGMENTS AND ESTIMATES
Please see a discussion of our critical accounting policies and significant judgments and estimates in Note 1 to the Company's Condensed Consolidated Financial Statements accompanying this report and the section entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations"in our 2024 Annual Report on Form 10-K.
Accounting Estimates and Judgments
The preparation of condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. We base our estimates on past experience and on other factors we deem reasonable given the circumstances. Past results help form the basis of our judgments about the carrying value of assets and liabilities that cannot be determined from other sources. Actual results could differ from these estimates. The Company's most significant estimates include: (1) its allowances for chargebacks and accruals for rebates and product returns, (2) the allowances for obsolescent or unmarketable inventory and (3) valuation of contingent consideration liabilities associated with business combinations.
RESULTS OF OPERATIONS
Three months ended September 30, 2025 compared to the three months ended September 30, 2024
The following table presents the unaudited interim statements of operations for continuing operations for the three months ended September 30, 2025 and 2024:
| Three months ended September 30, | |||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
| Net revenues | $ | 8,292,362 | $ | 9,085,826 | $ | (793,464) | |||||||||||
| Costs and expenses: | |||||||||||||||||
| Cost of products sold | 988,760 | 1,323,013 | (334,253) | ||||||||||||||
| Selling and marketing | 4,433,831 | 4,397,480 | 36,351 | ||||||||||||||
| Research and development | 1,253,367 | 1,306,095 | (52,728) | ||||||||||||||
| General and administrative | 2,572,066 | 2,675,380 | (103,314) | ||||||||||||||
| Amortization | 1,009,598 | 1,078,290 | (68,692) | ||||||||||||||
| Total costs and expenses | 10,257,622 | 10,780,258 | (522,636) | ||||||||||||||
| Operating loss | (1,965,260) | (1,694,432) | (270,828) | ||||||||||||||
| Interest income | 131,583 | 69,190 | 62,393 | ||||||||||||||
| Other income - insurance proceeds | - | 237,089 | (237,089) | ||||||||||||||
| Interest expense | (109,699) | (137,374) | 27,675 | ||||||||||||||
| Loss before income taxes | (1,943,376) | (1,525,527) | (417,849) | ||||||||||||||
| Income tax expense | (5,670) | (11,442) | 5,772 | ||||||||||||||
| Net loss | $ | (1,949,046) | $ | (1,536,969) | $ | (412,077) | |||||||||||
The following table summarizes net revenues by product for the periods presented:
| Three months ended September 30, | |||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
| Products: | |||||||||||||||||
| Kristalose | $ | 1,180,934 | $ | 3,632,258 | $ | (2,451,324) | |||||||||||
| Sancuso | 3,240,947 | 2,607,558 | 633,389 | ||||||||||||||
| Vibativ | 2,598,454 | 1,028,013 | 1,570,441 | ||||||||||||||
| Caldolor | 867,013 | 1,271,252 | (404,239) | ||||||||||||||
| Acetadote | 96,597 | 21,374 | 75,223 | ||||||||||||||
| Vaprisol | 600 | (135,765) | 136,365 | ||||||||||||||
| Omeclamox-Pak | (3,127) | (18) | (3,109) | ||||||||||||||
| RediTrex | 4,434 | 36,950 | (32,516) | ||||||||||||||
| Other revenue | 306,510 | 624,204 | (317,694) | ||||||||||||||
| Total net revenues | $ | 8,292,362 | $ | 9,085,826 | $ | (793,464) | |||||||||||
Net revenues.The net revenues for the three months ended September 30, 2025, were $8.3 million compared to $9.1 million for the three months ended September 30, 2024.
Kristalose revenue was $1.2 million for the third quarter of 2025 and $3.6 million for the same period in the prior year. The decrease was the result of lower sales volume primarily due to a delay in shipments of our Authorized Generic product, in addition to increased generic substitution.
Acetadote revenue includes net sales of our Acetadote brand and our share of net sales from our Authorized Generic. During the third quarter of 2025, there was an increase of $0.1 million in the product's revenue when compared to the prior year period due to an increase in our Authorized Generic sales.
There were no Vaprisol branded product sales for the third quarter of 2025 as Cumberland is currently out of inventory of the product as we await FDA approval on a new manufacturer. The amount represents adjustments of deductions from previous sales of the product.
Caldolor revenue was $0.9 million for the third quarter of 2025, compared to $1.3 million for the third quarter of 2024. The decrease was primarily due to a delay in the manufacturing and shipment of an international order for the product.
Vibativ revenue was $2.6 million for the three months ended September 30, 2025, and $1.0 million for the same prior year period. The increase in net revenue of the product was due to higher sales volumes, including growing shipments of the product's 4-Pak.
Sancuso revenue was $3.2 million for the third quarter of 2025, compared to $2.6 million for the third quarter of 2024 resulting in an increase of $0.6 million. The increase resulted primarily from increased shipments as well as lower sales deductions associated with the product.
Other revenue was $0.3 million for the three months ended September 30, 2025, compared to $0.6 million for the three months ended September 30, 2024. The decrease was primarily due to less CET revenues for the period.
Cost of products sold. The cost of products sold for the third quarter of 2025 and 2024 were $1.0 million and $1.3 million, respectively. Cost of products sold, as a percentage of net revenues, were 11.9% during the three months ended September 30, 2025, compared to 14.6% during the three months ended September 30, 2024. The favorable percentage decrease is primarily due to the higher international sales in 2024, which typically have lower gross margin.
Selling and marketing. The selling and marketing expenses for the third quarter of 2025 and 2024, were similar at $4.4 million for both periods.
Research and development. The research and development costs for the three months ended September 30, 2025 and 2024, were similar at $1.3 million for both periods.
General and administrative. The general and administrative expense for the third quarter of 2025 was $2.6 million compared to $2.7 million for the same period in 2024. The decrease is due to lower corporate life insurance expense.
The components of the statements of operations discussed above reflect the following impacts from Vibativ:
| Financial Impact of Vibativ |
Three months ended September 30,
|
|||||||||||||
| 2025 | 2024 | |||||||||||||
|
Net revenue (1)
|
$ | 2,613,143 | $ | 1,029,301 | ||||||||||
|
Cost of products sold (2)
|
286,983 | 233,938 | ||||||||||||
| Royalty and operating expenses | 859,309 | 300,368 | ||||||||||||
| Vibativ contribution | $ | 1,466,851 | $ | 494,995 | ||||||||||
(1) Net revenue includes $14,689 related to additional international training revenue.
(2) The Vibativ inventory included in the costs of product sold during the period was acquired and paid for by Cumberland as part of the acquisition of the brand during 2018.
The components of the statements of operations discussed above reflect the following impacts from Sancuso:
| Financial Impact of Sancuso |
Three months ended September 30,
|
|||||||||||||
| 2025 | 2024 | |||||||||||||
| Net revenue | $ | 3,240,947 | $ | 2,607,559 | ||||||||||
|
Cost of products sold (1)
|
145,251 | 135,233 | ||||||||||||
| Royalty and operating expenses | 989,864 | 1,071,764 | ||||||||||||
| Sancuso contribution | $ | 2,105,832 | $ | 1,400,562 | ||||||||||
(1) The Sancuso inventory included in the costs of product sold during 2024 was acquired and paid for by Cumberland as part of the acquisition of the brand during 2022. The acquired inventory was completely sold by the end of the second quarter 2024.
Amortization.The amortization expense is the ratable use of our capitalized intangible assets including product and license rights, patents, trademarks and patent defense costs. Amortization for the three months ended September 30, 2025 and 2024, totaled approximately $1.0 million and $1.1 million, respectively.
Income taxes. The income tax expense for the three months ended September 30, 2025, and for the three months ended September 30, 2024 was less than $0.01 million for each year.
Research and Development Expenses
The following table shows the primary components of our research and development expenses for the three months ended September 30, 2025 and 2024.
| Research and Development Expenses | Three months ended September 30, | ||||||||||
| 2025 | 2024 | ||||||||||
|
External research and development expenses
|
|
|
|
||||||||
|
Clinical development
|
$ | 322,959 | $ | 385,517 | |||||||
|
Regulatory expenses
|
357,020 | 364,521 | |||||||||
|
Other external
|
10,730 | 12,335 | |||||||||
|
Total external expenses
|
690,709 | 762,373 | |||||||||
|
Internal research and development expenses
|
|||||||||||
| Personnel costs | 509,550 | 477,596 | |||||||||
|
Other internal
|
53,108 | 66,126 | |||||||||
|
Total internal expenses
|
562,658 | 543,722 | |||||||||
|
Total research and development expenses
|
$ | 1,253,367 | $ | 1,306,095 | |||||||
RESULTS OF OPERATIONS
Nine months ended September 30, 2025 compared to the nine months ended September 30, 2024
The following table presents the unaudited interim statements of operations for continuing operations for the nine months ended September 30, 2025 and 2024:
| Nine months ended September 30, | |||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
| Net revenues | $ | 30,842,780 | $ | 27,432,376 | $ | 3,410,404 | |||||||||||
| Costs and expenses: | |||||||||||||||||
| Cost of products sold | 4,425,863 | 4,609,499 | (183,636) | ||||||||||||||
| Selling and marketing | 12,889,458 | 12,800,469 | 88,989 | ||||||||||||||
| Research and development | 4,016,842 | 3,523,535 | 493,307 | ||||||||||||||
| General and administrative | 7,909,996 | 7,800,435 | 109,561 | ||||||||||||||
| Amortization | 3,021,412 | 3,288,808 | (267,396) | ||||||||||||||
| Total costs and expenses | 32,263,571 | 32,022,746 | 240,825 | ||||||||||||||
| Operating loss | (1,420,791) | (4,590,370) | 3,169,579 | ||||||||||||||
| Interest income | 384,781 | 227,777 | 157,004 | ||||||||||||||
| Other income - insurance proceeds | - | 237,089 | (237,089) | ||||||||||||||
| Interest expense | (383,048) | (382,247) | (801) | ||||||||||||||
| Loss before income taxes | (1,419,058) | (4,507,751) | 3,088,693 | ||||||||||||||
| Income tax expense | (17,011) | (34,327) | 17,316 | ||||||||||||||
| Net loss | $ | (1,436,069) | $ | (4,542,078) | $ | 3,106,009 | |||||||||||
| Nine months ended September 30, | |||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
| Products: | |||||||||||||||||
| Kristalose | $ | 7,419,832 | $ | 10,935,702 | $ | (3,515,870) | |||||||||||
| Sancuso | 8,616,353 | 6,624,102 | 1,992,251 | ||||||||||||||
| Vibativ | 6,678,374 | 5,087,983 | 1,590,391 | ||||||||||||||
| Caldolor | 3,762,746 | 3,586,199 | 176,547 | ||||||||||||||
| Acetadote | 441,503 | 144,973 | 296,530 | ||||||||||||||
| Vaprisol | (14,621) | (128,684) | 114,063 | ||||||||||||||
| Omeclamox-Pak | (9,266) | (2,574) | (6,692) | ||||||||||||||
| RediTrex | 7,330 | 71,350 | (64,020) | ||||||||||||||
| Other revenue | 3,940,529 | 1,113,325 | 2,827,204 | ||||||||||||||
| Total net revenues | $ | 30,842,780 | $ | 27,432,376 | $ | 3,410,404 | |||||||||||
Net revenues.The net revenues for the nine months ended September 30, 2025, were $30.8 million compared to $27.4 million for the nine months ended September 30, 2024, an increase of $3.4 million.
Kristalose revenue was $7.4 million during the first nine months of 2025, compared to $10.9 million for the prior year period. The decrease was the result of lower sales volume primarily due to a delay in shipments of our Authorized Generic product, in addition to increased generic substitution..
Acetadote revenue includes net sales of our Acetadote brand and our share of net sales from our Authorized Generic. During the nine months ended September 30, 2025, there was an increase of $0.3 million in the product's revenue when compared to the prior year period due to an increase in sales for our Authorized Generic.
Sancuso revenue was $8.6 million for the nine months ended September 30, 2025, compared to $6.6 million for the same period last year. The increase resulted primarily from increased shipments, as well as lower sales deductions associated with the product.
Vibativ revenue was $6.7 million for the nine months ended September 30, 2025, and $5.1 million for the nine months ended September 30, 2024. The increase in net revenue of the product was due to higher sales volumes, including growing shipments of the product's 4-Pak.
There were no Vaprisol branded product sales for the nine months ended September 30, 2025 and 2024. The amount represents adjustments of deductions from previous sales of the product.
Omeclamox-Pak had no sales for the nine months ended September 30, 2025 and 2024. The amount represents adjustments of deductions from previous sales of the product.
Caldolor revenue was $3.8 million for the nine months ended September 30, 2025, an increase of $0.2 million over the same period in 2024 primarily due to an increase in international shipments.
Other revenue was $3.9 million for the nine months ended September 30, 2025, representing a $2.8 million increase from the same period in 2024, primarily as a result of a milestone payment received in 2025.
Cost of products sold. The cost of products sold for the first nine months of 2025 was $4.4 million, consistent with the $4.6 million for the first nine months of 2024.
Selling and marketing. The selling and marketing expense for the nine months ended September 30, 2025, increased $0.1 million compared to the prior year period. This slight increase is primarily attributable to the timing of the expenditures.
Research and development. The research and development costs were $4.0 million for the first nine months of 2025 compared to $3.5 million for the same period last year. A portion of our research and development costs is variable as we continue to fund the ongoing clinical initiatives associated with our pipeline product candidates. These variable costs depend on the number of active trials, study sites and patients as well as the cost per patient in each of our clinical programs.
General and administrative. The general and administrative expenses for the nine months ended September 30, 2025, was $7.9 million compared to $7.8 million during the nine months ended September 30, 2024. This slight increase is due to higher salary expense in 2025.
The components of the statements of operations discussed above reflect the following impacts from Vibativ:
| Financial Impact of Vibativ | Nine months ended September 30, | |||||||||||||
| 2025 | 2024 | |||||||||||||
|
Net revenue (1)
|
$ | 9,668,063 | $ | 5,089,271 | ||||||||||
|
Cost of products sold (2)
|
1,176,100 | 1,060,584 | ||||||||||||
| Royalty and operating expenses | 2,043,678 | 1,378,848 | ||||||||||||
| Vibativ contribution | $ | 6,448,285 | $ | 2,649,839 | ||||||||||
(1) Net revenue includes $2,989,689 related to a milestone payment received in 2025 along with other product related revenue.
(2)The Vibativ inventory included in the costs of product sold during the period was acquired and paid for by Cumberland as part of the acquisition of the brand during 2018.
| Financial Impact of Vibativ | Since Acquisition | |||||||
|
Net revenue (1)
|
$ | 70,400,653 | ||||||
|
Cost of products sold (2)
|
20,154,430 | |||||||
| Royalty and operating expenses | 12,715,218 | |||||||
| Vibativ contribution | $ | 37,531,005 | ||||||
(1)Net revenue includes a $1,000,000 payment to Cumberland related to a settlement agreement of milestone payments, $15,978 of other income and $2,975,000 related to a milestone payment.
(2) A portion of the Vibativ inventory included in the costs of product sold during the period was acquired and paid for by Cumberland as part of the acquisition of the brand during 2018.
| Financial Impact of Sancuso | Nine months ended September 30, | |||||||||||||
| 2025 | 2024 | |||||||||||||
| Net revenue | $ | 8,616,353 | $ | 6,624,103 | ||||||||||
|
Cost of products sold (1)
|
442,955 | 691,358 | ||||||||||||
| Royalty and operating expenses | 2,930,585 | 2,601,815 | ||||||||||||
| Sancuso contribution | $ | 5,242,813 | $ | 3,330,930 | ||||||||||
(1)The Sancuso inventory included in the costs of product sold was acquired and paid for by Cumberland as part of the acquisition of the brand during 2022. The acquired inventory was completely sold by the end of the second quarter 2024.
| Financial Impact of Sancuso | Since Acquisition | |||||||
| Net revenue | $ | 39,273,876 | ||||||
|
Cost of products sold (1)
|
3,878,435 | |||||||
| Royalty and operating expenses | 14,285,594 | |||||||
| Sancuso contribution | $ | 21,109,847 | ||||||
(1)The Sancuso inventory included in the costs of product sold during the period was acquired and paid for by Cumberland as part of the acquisition of the brand during 2022. The acquired inventory was completely sold by the end of the second quarter 2024.
Amortization.The amortization expense is the ratable use of our capitalized intangible assets including product and license rights, patents, trademarks and patent defense costs. Amortization for the nine months ended September 30, 2025, and nine months ended September 30, 2024, totaled approximately $3.0 million and $3.3 million, respectively. The decrease was attributable to a reduction to the valuation of the Acetadote intangible asset recognized in December 2024.
Income taxes. The income tax expense for the nine months ended September 30, 2025, was $0.02 million, compared to $0.03 million for the nine months ended September 30, 2024.
As of September 30, 2025, we held approximately $52.6 million in federal net operating loss carryforwards including approximately $44.1 million of net operating loss carryforwards resulting from the exercise of nonqualified stock options that have historically been used to significantly offset income tax obligations. We expect to continue to pay minimal income taxes during 2025 and beyond, through the continued utilization of these net operating loss carryforwards, on any taxable income generated from our operations.
Research and Development Expenses
The following table shows the primary components of our research and development expenses for the nine months ended September 30, 2025 and 2024.
| Research and Development Expenses | Nine months ended September 30, | ||||||||||
| 2025 | 2024 | ||||||||||
|
External research and development expenses
|
|
|
|
||||||||
|
Clinical development
|
$ | 1,235,616 | $ | 1,062,209 | |||||||
|
Regulatory expenses
|
1,072,175 | 734,460 | |||||||||
|
Other external
|
39,425 | 36,700 | |||||||||
|
Total external expenses
|
2,347,216 | 1,833,369 | |||||||||
|
Internal research and development expenses
|
|||||||||||
| Personnel costs | 1,524,960 | 1,548,660 | |||||||||
|
Other internal
|
144,666 | 141,506 | |||||||||
|
Total internal expenses
|
1,669,626 | 1,690,166 | |||||||||
|
Total research and development expenses
|
$ | 4,016,842 | $ | 3,523,535 | |||||||
LIQUIDITY AND CAPITAL RESOURCES
Working Capital
Our primary sources of liquidity are cash equivalents, cash flows from operations and the amounts borrowed under our line of credit. We believe that our internally generated cash flows, existing working capital and our line of credit will be adequate to finance internal growth, finance business development initiatives, and fund capital expenditures for the foreseeable future.
The following table summarizes our liquidity and working capital as of September 30, 2025 and December 31, 2024:
| September 30, 2025 | December 31, 2024 | ||||||||||
| Cash and cash equivalents | $ | 15,196,745 | $ | 17,964,184 | |||||||
| Working capital (current assets less current liabilities) | $ | 5,629,479 | $ | 4,830,429 | |||||||
| Current ratio (multiple of current assets to current liabilities) | 1.2 | 1.2 | |||||||||
| Revolving line of credit availability | $ | 14,759,267 | $ | 4,723,830 | |||||||
The following table summarizes our net changes in cash and cash equivalents for the nine months ended September 30, 2025 and September 30, 2024:
| Nine months ended September 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Net cash provided by (used in): | |||||||||||
| Operating activities | $ | 4,929,498 | $ | (2,516,804) | |||||||
| Investing activities | (1,633,159) | 84,651 | |||||||||
| Financing activities | (6,063,778) | 1,575,283 | |||||||||
| Net decrease in cash and cash equivalents | $ | (2,767,439) | $ | (856,870) | |||||||
The net $2.8 million decrease in cash and cash equivalents for the nine months ended September 30, 2025, was primarily attributable to $7.7 million of cash used in financing and investing activities, partially offset by $4.9 million of cash provided by operating activities.
Cash provided by operating activities totaled $4.9 million for the nine months ended September 30, 2025, primarily due to the $1.4 million net loss, adjusted by adding back $3.1 million expense in depreciation and amortization, $2.4 million due to a decrease in inventory, $1.3 million due to a decrease in accounts receivable, $0.9 million expense in deduction in the carrying amount of right-of-use assets and $0.8 million due to a decrease in other current assets and other assets, partially offset by deducting $1.3 million due to a decrease in accounts payable and other current liabilities and a $0.7 million decrease in operating leases liabilities.
Cash used in investing activities totaled $1.6 million which was the result of $1.4 million paid for investments in manufacturing as well as an increase in fixed assets and intangible assets.
Cash used in financing activities totaled $6.1 million for the nine months ended September 30, 2025, primarily due to $10.0 million in payments on our line of credit, $1.0 million for cash settlement of contingent consideration, and $0.3 million in cash used to repurchase shares of our common stock, partially offset by $5.3 million in proceeds from our ATM offering.
Debt Agreement
On September 5, 2023, the Company entered into a new Revolving Credit Loan Agreement with Pinnacle Bank. This facility provides for an aggregate principal funding amount of up to $25 million. The initial revolving line of credit is up to $20 million, with the ability for Cumberland to increase the amount to $25 million, under certain conditions. It has a three year term expiring on October 1, 2026. The interest rate is based on Benchmark (Term SOFR) plus 2.75%. Cumberland is subject to one financial covenant, the maintenance of a Funded Debt Ratio, determined on a quarterly basis. Borrowings under the line of credit are collateralized by substantially all of our assets.
On May 6, 2024, the Company entered into a First Amendment to the Loan Agreement which provides an alternative to the financial covenant by delivering to the lender a borrowing base certificate and complying with certain borrowing base requirements which set forth a maximum revolver amount equal to the lessor of (a) up to $20 million or (b) the sum of the Company's cash balances and eligible accounts receivable.
OFF-BALANCE SHEET ARRANGEMENTS
During the nine months ended September 30, 2025 and 2024, we did not engage in any off-balance sheet arrangements.
Cumberland Pharmaceuticals Inc. published this content on November 07, 2025, and is solely responsible for the information contained herein. Distributed via Edgar on November 07, 2025 at 22:06 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]