0001558370-22-012184 | 10-Q | XBRL Viewer | Collegium Pharmaceutical INC

Print Document View Excel Document

License Agreements	6 Months Ended
Jun. 30, 2022
License Agreements
License Agreements	5. License Agreements The Company periodically enters into license agreements to develop and commercialize its products. Dr. Reddy’s acquired product rights Prior to the BDSI Acquisition, BDSI and Dr. Reddy’s Laboratories Limited (“DRL”), entered into an asset purchase agreement (the “Elyxyb Asset Purchase Agreement”) for the acquisition by BDSI from DRL of certain patents, trademarks, regulatory approvals and other rights related to Elyxyb and its commercialization in the United States and Canada (the “DRL Territory”). Pursuant to the terms of the Elyxyb Asset Purchase Agreement, a $9,000 payment is due to DRL on August 3, 2022. In addition, up to an additional $9,000 of payments are due to DRL upon achievement of certain regulatory milestones as well as for quarterly earn-out payments on potential sales of the Elyxyb Product in the DRL Territory that range from high single digits to the low double digits (subject to reduction in certain circumstances) of net sales based on volume of sales. DRL will also be entitled to one-time payments upon the achievement of six escalating sales milestones, which range from $4,000 to be paid upon the achievement of $50,000 in net sales in a calendar year to $100,000 to be paid upon the achievement of $1,000,000 in net sales in a calendar year up to a total of $262,000. Shionogi license and supply agreement Prior to the BDSI Acquisition, BDSI and Shionogi Inc. (“Shionogi”) entered into an exclusive license agreement (the “Shionogi License Agreement”) for the commercialization of Symproic in the United States including Puerto Rico (the “Shionogi Territory”) for opioid-induced constipation in adult patients with chronic non-cancer pain (the “Shionogi Field”). Pursuant to the terms of the Shionogi License Agreement, tiered royalty payments on net sales of Symproic in the Shionogi Territory are payable quarterly based on a royalty rate that ranges from 8.5% to 17.5% (plus an additional 1% of net sales on a pass-through basis to a third-party licensor of Shionogi) based on volume of net sales and whether Symproic is being sold as an authorized generic. Unless earlier terminated, the Shionogi License Agreement will continue in effect until the expiration of the royalty obligations, as defined therein. Upon expiration of the Shionogi License Agreement, all licenses granted for Symproic in the Shionogi Field and in the Shionogi Territory survive and become fully-paid, royalty-free, perpetual and irrevocable. BDSI and Shionogi also had entered into a supply agreement under which Shionogi will supply Symproic at cost plus an agreed upon markup. In the event that Symproic is sourced from a third-party supplier, Shionogi would continue to supply naldemedine tosylate for use in Symproic manufacturing at cost plus such agreed upon markup for the duration of the Shionogi License Agreement.

License Agreements

6 Months Ended

Jun. 30, 2022

License Agreements

License Agreements

5. License Agreements

The Company periodically enters into license agreements to develop and commercialize its products.

Dr. Reddy’s acquired product rights

Prior to the BDSI Acquisition, BDSI and Dr. Reddy’s Laboratories Limited (“DRL”), entered into an asset purchase agreement (the “Elyxyb Asset Purchase Agreement”) for the acquisition by BDSI from DRL of certain patents, trademarks, regulatory approvals and other rights related to Elyxyb and its commercialization in the United States and Canada (the “DRL Territory”).

Pursuant to the terms of the Elyxyb Asset Purchase Agreement, a $9,000 payment is due to DRL on August 3, 2022. In addition, up to an additional $9,000 of payments are due to DRL upon achievement of certain regulatory milestones as well as for quarterly earn-out payments on potential sales of the Elyxyb Product in the DRL Territory that range from high single digits to the low double digits (subject to reduction in certain circumstances) of net sales based on volume of sales. DRL will also be entitled to one-time payments upon the achievement of six escalating sales milestones, which range from $4,000 to be paid upon the achievement of $50,000 in net sales in a calendar year to $100,000 to be paid upon the achievement of $1,000,000 in net sales in a calendar year up to a total of $262,000.

Shionogi license and supply agreement

Prior to the BDSI Acquisition, BDSI and Shionogi Inc. (“Shionogi”) entered into an exclusive license agreement (the “Shionogi License Agreement”) for the commercialization of Symproic in the United States including Puerto Rico (the “Shionogi Territory”) for opioid-induced constipation in adult patients with chronic non-cancer pain (the “Shionogi Field”).

Pursuant to the terms of the Shionogi License Agreement, tiered royalty payments on net sales of Symproic in the Shionogi Territory are payable quarterly based on a royalty rate that ranges from 8.5% to 17.5% (plus an additional 1% of net sales on a pass-through basis to a third-party licensor of Shionogi) based on volume of net sales and whether Symproic is being sold as an authorized generic. Unless earlier terminated, the Shionogi License Agreement will continue in effect until the expiration of the royalty obligations, as defined therein. Upon expiration of the Shionogi License Agreement, all licenses granted for Symproic in the Shionogi Field and in the Shionogi Territory survive and become fully-paid, royalty-free, perpetual and irrevocable.

BDSI and Shionogi also had entered into a supply agreement under which Shionogi will supply Symproic at cost plus an agreed upon markup. In the event that Symproic is sourced from a third-party supplier, Shionogi would continue to supply naldemedine tosylate for use in Symproic manufacturing at cost plus such agreed upon markup for the duration of the Shionogi License Agreement.

Accrued Expenses (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Accrued Expenses
Accrued royalties	$ 13,692	$ 9,930
Acquired product right	9,000
Accrued product taxes and fees	3,421	2,570
Accrued bonuses	2,396	2,634
Accrued audit and legal	2,116	3,623
Accrued payroll and related benefits	1,969	807
Accrued sales and marketing	1,555	697
Accrued interest	1,415	1,415
Accrued incentive compensation	1,054	851
Accrued income taxes		622
Accrued restructuring expenses		3,222
Accrued other operating costs	3,086	2,843
Total accrued expenses	$ 39,704	$ 29,214

Equity

6 Months Ended

Jun. 30, 2022

Equity

Equity

13. Equity

The changes in shareholders’ equity for the three and six months ended June 30, 2022 were as follows:


				Additional							Total
	Common Stock			Paid- In		Treasury Stock			Accumulated		Shareholders’
	Shares		Amount	Capital		Shares		Amount	Deficit		Equity
Balance, December 31, 2021	35,806,119	$	36	$	502,095	(2,150,717)	$	(42,861)	$	(256,342)	$	202,928
Exercise of common stock options	190,074		—		3,261	—		—		—		3,261
Issuance for employee stock purchase plan	13,421		—		203	—		—		—		203
Vesting of RSUs and PSUs	563,050		—		—	—		—		—		—
Shares withheld for employee taxes upon vesting of RSUs and PSUs	(191,667)		—		(3,382)	—		—		—		(3,382)
Share repurchases from Accelerated Share Repurchase ("ASR") agreement	—		—		5,000	(307,132)		(5,000)		—		—
Stock-based compensation	—		—		6,135	—		—		—		6,135
Net loss	—		—		—	—		—		(13,069)		(13,069)
Balance, March 31, 2022	36,380,997	$	36	$	513,312	(2,457,849)	$	(47,861)	$	(269,411)	$	196,076
Exercise of common stock options	102,283		—		1,545	—		—		—		1,545
Vesting of RSUs and PSUs	111,056		1		—	—		—		—		1
Shares withheld for employee taxes upon vesting of RSUs and PSUs	(26,506)		—		(511)	—		—		—		(511)
Stock-based compensation	—		—		5,692	—		—		—		5,692
Net loss	—		—		—	—		—		(5,191)		(5,191)
Balance, June 30, 2022	36,567,830	$	37	$	520,038	(2,457,849)	$	(47,861)	$	(274,602)	$	197,612

The changes in shareholders’ equity for the three and six months ended 2021 were as follows:


				Additional							Total
	Common Stock			Paid- In		Treasury Stock			Accumulated		Shareholders’
	Shares		Amount	Capital		Shares		Amount	Deficit		Equity
Balance, December 31, 2020	34,612,054	$	35	$	519,143	—	$	—	$	(333,147)	$	186,031
Cumulative effect adjustment for adoption of ASU 2020-06	—		—		(44,777)	—		—		5,288		(39,489)
Exercise of common stock options	289,164		—		4,102	—		—		—		4,102
Issuance for employee stock purchase plan	24,630		—		358	—		—		—		358
Vesting of RSUs and PSUs	413,538		—		—	—		—		—		—
Shares withheld for employee taxes upon vesting of RSUs and PSUs	(135,562)		—		(3,508)	—		—		—		(3,508)
Stock-based compensation	—		—		6,879	—		—		—		6,879
Net income	—		—		—	—		—		15,662		15,662
Balance, March 31, 2021	35,203,824	$	35	$	482,197	—	$	—	$	(312,197)	$	170,035
Exercise of common stock options	273,127		1		4,092	—		—		—		4,093
Vesting of RSUs and PSUs	65,107		—		—	—		—		—		—
Shares withheld for employee taxes upon vesting of RSUs and PSUs	(18,141)		—		(421)	—		—		—		(421)
Stock-based compensation	—		—		6,516	—		—		—		6,516
Net income	—		—		—	—		—		72,843		72,843
Balance, June 30, 2021	35,523,917	$	36	$	492,384	—	$	—	$	(239,354)	$	253,066

Common Stock

In May 2015, the Company adopted the Amended and Restated 2014 Stock Incentive Plan (the “Plan”), under which an aggregate of 2,700,000 shares of common stock were authorized for issuance to employees, officers, directors, consultants and advisors of the Company, plus an annual increase on the first day of each fiscal year until the expiration of the Plan equal to 4% of the total number of outstanding shares of common stock on December 31^st of the immediately preceding calendar year (or a lower amount as otherwise determined by the Company’s board of directors (“Board of Directors”) prior to January 1^st). As of June 30, 2022, there were 1,871,810 shares of common stock available for issuance pursuant to the Plan. The Plan provides for granting of both Internal Revenue Service qualified incentive stock options and non-qualified options, restricted stock awards, restricted stock units and performance stock units. The Company’s qualified incentive stock options, non-qualified options and restricted stock units generally vest ratably over a four-year period of service. The stock options generally have a ten-year contractual life and, upon termination, vested options are generally exercisable three months following the termination date, while unvested options are forfeited immediately upon termination. Refer to Note 14, Stock-based Compensation, for more information.

Warrants

As of June 30, 2022, the warrant issued to Assertio in November 2018 was the Company’s only outstanding warrant. In connection with the Third Amendment to the Nucynta Commercialization Agreement, the Company issued a warrant to Assertio to purchase 1,041,667 shares of common stock of the Company at an exercise price of $19.20 per share. The terms of the warrant are fixed, with the exception of customary adjustments for changes in the Company’s capitalization. The warrant may only be settled with the issuance of shares of common stock upon exercise and will expire in November 2022.

Share Repurchases

In August 2021, the Company’s board of directors authorized a share repurchase program to repurchase up to $100,000 of outstanding shares of the Company’s common stock at any time or times through December 31, 2022 (the “Repurchase Program”). The Repurchase Program permits the Company to effect repurchases through a variety of methods, including open-market purchases (including pursuant to a trading plan adopted in accordance with Rule 10b5-1 of the Exchange Act), privately negotiated transactions, or otherwise in compliance with Rule 10b-18 of the Exchange Act. Shares repurchased under the Repurchase Program will return to the Company’s pool of authorized but unissued shares available for reissuance. The timing and amount of any such repurchases will be determined based on share price, market conditions, legal requirements, and other relevant factors. The Repurchase Program can be discontinued at any time. There can be no assurance as to the timing or number of shares of any repurchases in the future.

In October 2021, the Company’s board of directors authorized an accelerated share repurchase program (the “ASR Program”) to repurchase $25,000 of the Company’s common stock, as part of the Company’s existing $100,000 Repurchase Program. Under the terms of the Company's ASR agreement with an investment bank (the “ASR Agreement”), the Company paid $25,000 on November 15, 2021, and received 1,026,694 shares, representing 80% of the upfront payment on a price per share of $19.48, the closing price on the date the ASR Agreement was executed. The remaining shares purchased by the Company was based on the volume-weighted average price of its common stock through January 7, 2022, minus an agreed upon discount between the parties. On January 7, 2022, the ASR Agreement settled, and the Company received an additional 307,132 shares, bringing the total shares repurchased pursuant to the ASR Agreement to 1,333,826.

As of June 30, 2022, the Company repurchased 2,457,849 shares at a weighted-average price of $19.47 per share for a total of $47,861 under the Repurchase Program and the cost of repurchased shares were recorded as treasury stock in the condensed consolidated Balance Sheet. As of June 30, 2022, $52,139 remained available for share repurchases under the Repurchase Program.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 14
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496171-112644

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 14
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496171-112644

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-URI http://asc.fasb.org/extlink&oid=120397183&loc=d3e187085-122770

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 18
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496189-112644

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (g)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-URI http://asc.fasb.org/topic&trid=2208762

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 18
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496189-112644

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (h)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 14
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496171-112644

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 18
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496189-112644

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 16
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496180-112644

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (i)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(e)(1))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

License Agreements - License and supply agreement (Details) - Shionogi license and supply agreement	Apr. 04, 2019
License Agreements [Line Items]
Additional Percentage	1.00%
Minimum
License Agreements [Line Items]
Royalty Percentage	8.50%
Maximum
License Agreements [Line Items]
Royalty Percentage	17.50%

Stock-based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Stock-based compensation
Proceeds from issuances of common stock from employee stock purchase plans			$ 203	$ 358
Unrecognized compensation cost related to outstanding options	$ 43,096		$ 43,096
Period over which unrecognized compensation cost is expected to be recognized as expense			2 years 7 months 6 days
Stock-based compensation expense			$ 11,827	13,395
Restricted stock units
Stock-based compensation
Vesting period (in years)			4 years
Total fair value of shares vested			$ 9,697	$ 10,515
Stock options
Stock-based compensation
Weighted-average grant date fair value per share of grants (in dollars per share)				$ 12.60
Employee stock purchase plan
Stock-based compensation
Employee Stock Purchase Plan, Purchase Price Percentage			85.00%
Issuance for employee stock purchase plan, shares			13,421
Proceeds from issuances of common stock from employee stock purchase plans			$ 203
Total purchased proceeds	$ 28	$ 65	$ 60	$ 137

Stock-based Compensation - Summary of Stock Option Activity (Details) - Stock options $ / shares in Units, $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2022 USD ($) $ / shares shares	Dec. 31, 2021 USD ($) $ / shares shares
Stock option activity
Outstanding \| shares	2,728,169
Exercised \| shares	(292,357)
Cancelled \| shares	(204,917)
Outstanding \| shares	2,230,895	2,728,169
Exercisable at end of period \| shares	1,948,941
Weighted average exercise price per share
Outstanding \| $ / shares	$ 18.33
Exercised \| $ / shares	16.44
Cancelled \| $ / shares	21.81
Outstanding \| $ / shares	18.26	$ 18.33
Exercisable at end of period \| $ / shares	$ 18.19
Stock option activity, additional information
Outstanding Weighted-Average Remaining Contractual Term	5 years 8 months 12 days	5 years 9 months 18 days
Outstanding Aggregate Intrinsic Value \| $	$ 4,040	$ 6,070
Exercisable at end of period, Weighted-Average Remaining Contractual Term	5 years 6 months
Exercisable at end of period, Aggregate Intrinsic Value \| $	$ 3,724

Stock-based Compensation - Summary of Restricted Stock and Performance Share Activity (Details) - $ / shares	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021
Performance share units
Number of shares
Balance	353,100
Granted	241,550
Vested	(126,081)
Forfeited	(22,104)
Performance adjustment	1,305
Balance	447,770
Weighted-average grant date fair value per share
Balance	$ 31.77
Granted	24.12	$ 35.15
Vested	29.12
Forfeited	29.60
Performance adjustment	28.96
Balance	$ 28.71
Restricted stock units
Number of shares
Balance	1,620,023
Granted	1,241,897
Vested	(548,025)
Forfeited	(289,261)
Balance	2,024,634
Weighted-average grant date fair value per share
Balance	$ 22.48
Granted	17.48	$ 24.37
Vested	22.09
Forfeited	20.72
Balance	$ 19.76

Earnings Per Share (Tables)

6 Months Ended

Jun. 30, 2022

Earnings Per Share

Schedule of computations of basic and diluted net (loss) per share


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Numerator:
Net (loss) income	$	(5,191)	$	72,843	$	(18,260)	$	88,505
Adjustment for interest expense recognized on convertible senior notes:		—		1,168		—		2,333
Net (loss) income - diluted	$	(5,191)	$	74,011	$	(18,260)	$	90,838
Denominator:
Weighted-average shares outstanding — basic		34,001,553		35,302,608		33,838,638		35,128,144
Effect of dilutive securities:
Stock options		—		580,329		—		624,602
Restricted stock units		—		302,737		—		384,908
Performance share units		—		—		—		—
Employee stock purchase plan		—		125		—		1,149
Warrants		—		175,920		—		187,812
Convertible senior notes		—		4,925,134		—		4,925,134
						—
Weighted average shares outstanding — diluted		34,001,553		41,286,853		33,838,638		41,251,749

(Loss) earnings per share — basic	$	(0.15)	$	2.06	$	(0.54)	$	2.52
(Loss) earnings per share — diluted	$	(0.15)	$	1.79	$	(0.54)	$	2.20

Schedule of dilutive securities excluded from the calculation of diluted earnings per share


	Three Months Ended June 30,		Six Months Ended June 30,
	2022	2021	2022	2021
Stock options	2,230,895	1,416,696	2,230,895	1,415,431
Restricted stock units	2,024,634	677,824	2,024,634	677,824
Performance share units	447,770	392,220	447,770	392,220
Employee stock purchase plan	—	—	—	—
Warrants	1,041,667	—	1,041,667	—
Convertible senior notes	4,925,134	—	4,925,134	—

Commitments and Contingencies (Details) $ in Thousands																				6 Months Ended	18 Months Ended
Commitments and Contingencies (Details) $ in Thousands	Jul. 22, 2022 lawsuit	May 11, 2022 case	Apr. 19, 2022 case	Apr. 11, 2022 case	Mar. 11, 2022 stockholder	Mar. 09, 2022 stockholder	Mar. 07, 2022 stockholder	Mar. 05, 2022 case	Mar. 04, 2022 stockholder	Mar. 02, 2022 case	Feb. 28, 2022 case stockholder	Feb. 24, 2022 stockholder	Dec. 24, 2021 USD ($) case	Dec. 16, 2021 USD ($)	Sep. 11, 2020	Oct. 02, 2019	Aug. 29, 2019 judge	Mar. 24, 2015 patent	Feb. 11, 2015 patent	Jun. 30, 2022 case lawsuit	Apr. 30, 2017 lawsuit patent
Commitments and Contingencies
Number of lawsuits dismissed			8
Claims settled													27
Xtampza ER Litigation
Commitments and Contingencies
Number of patents listed in FDA Orange Book \| patent																			11
Stay period before FDA can issue a final approval unless it is terminated																			30 months
Number of patents allegedly infringed \| patent																			5		2
Number of lawsuits filed \| lawsuit																					2
PTAB duration for issuing decision																1 year
Statutory period of proceedings															18 months
Xtampza ER Litigation \| Maximum
Commitments and Contingencies
PTAB extended duration for issuing decision																6 months
Xtampza ER Litigation, District of Delaware
Commitments and Contingencies
Stay period before FDA can issue a final approval unless it is terminated																		30 months
Number of patents allegedly infringed \| patent																		3
Xtampza ER Litigation, District of Massachusetts
Commitments and Contingencies
Stay period before FDA can issue a final approval unless it is terminated																		30 months
Number of patents allegedly infringed \| patent																		3
Opioid Litigation
Commitments and Contingencies
Number of lawsuits filed \| lawsuit																				6
Number of lawsuits dismissed			8																	13
Number of lawsuits designated as Track One case \| lawsuit																				0
Litigation settlement, amount awarded to other party \| $													$ 2,750
Claims settled													27
Opioid Litigation \| Maximum
Commitments and Contingencies
Litigation settlement, amount awarded to other party \| $													$ 2,750
Opioid Litigation, Pennsylvania state court
Commitments and Contingencies
Number of cases still awaiting court sign-off				6
Opioid Litigation, Massachusetts state court
Commitments and Contingencies
Number of cases still awaiting court sign-off		13
Opioid Litigation, Massachusetts state court \| Subsequent Events
Commitments and Contingencies
Number of lawsuits dismissed \| lawsuit	13
Multi-District Litigation (MDL)
Commitments and Contingencies
Number of lawsuits filed																				21
Number of lawsuits dismissed																				3
Opioid-Related Request and Subpoenas
Commitments and Contingencies
Agreed to pay attorney general \| $														$ 185
Reimbursement of investigation cost of the attorney general \| $														$ 65
BDSI Acquisition Litigation
Commitments and Contingencies
Number of additional cases filed								2		2	2
Number of demand letters received from purported stockholders \| stockholder					4	4	3		4		3	3
Number of judge in panel \| judge																	3

Term Notes Payable (Tables)

6 Months Ended

Jun. 30, 2022

Pharmakon Term Notes

Debt Instrument [Line Items]

Schedule of future payments under debt agreements


Years ended December 31,	Principal Payments
2022	$	50,000
2023		162,500
2024		183,333
2025		183,333
2026		45,834
Total before unamortized discount and issuance costs	$	625,000
Less: unamortized discount and issuance costs		(19,314)
Total term notes	$	605,686

Acquisitions - Unaudited Pro Forma Summary of Operations (Details) - BioDelivery Sciences International, Inc - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
	Jan. 01, 2021	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Business Acquisition [Line Items]
Total revenues		$ 123,549	$ 124,380	$ 236,651	$ 253,121
Net (loss) income		$ 1,238	$ 63,824	$ (18,950)	$ 24,814
Acquisition costs	$ 14,718
Employee severance related expense	$ 8,008

Acquisitions

6 Months Ended

Jun. 30, 2022

Acquisitions

Acquisitions

4. Acquisitions

On March 22, 2022, the Company closed the BDSI Acquisition pursuant to the Merger Agreement, with BDSI surviving the Merger as a wholly owned subsidiary of the Company. The BDSI Acquisition was completed to leverage the Company’s existing sales force and other operations to commercialize additional products that are typically marketed to similar physicians and to develop other synergies. The Company obtained control through the acquisition of shares in an all-cash transaction which closed on March 22, 2022.

The total consideration paid for the BDSI acquisition was approximately $669.4 million consisting of the following (in thousands, except per share amounts):


Fair Value of Purchase Price Consideration	Amount
Fair value of purchase price consideration paid at closing:
Cash consideration for all outstanding shares of BDSI's common and preferred stock (103,235,298 shares acquired at $5.60 per share)	$	578,118
Cash consideration paid to settle RSUs and in-the-money options		28,309
Cash paid to settle BDSI debt		63,004
Total purchase consideration	$	669,431

The Company has accounted for the BDSI Acquisition as a business combination and, accordingly, has included the assets acquired, liabilities assumed and results of operations in its financial statements following the Acquisition Date.

The preliminary purchase price allocation is based on estimates, assumptions, valuations and other studies which have not yet been finalized. Prior to the finalization of the purchase price allocation, if information becomes available that would indicate it is probable that unknown events had occurred and the amounts can be reasonably estimated, such items will be included in the final purchase price allocation and may change the carrying value of goodwill. The Company is finalizing its valuation of intangible assets, tangible assets, liabilities and tax analyses, and anticipates finalizing the purchase price allocation as the information necessary to complete the analysis is obtained, but no later than one year after the Acquisition Date. During the quarter ended June 30, 2022, the Company recorded measurement period adjustments to increase inventory by $14,300, decrease intangible assets by $10,000, increase accrued rebates, returns and discounts by $3,916, increase prepaid expenses and other current assets by $888, decrease accrued expenses by $502, and increase deferred tax liabilities by $356, with a net offsetting decrease to goodwill of $1,418.

The following tables set forth the preliminary allocation of the BDSI Acquisition purchase price to the estimated fair value of the net assets acquired at the Acquisition Date (in thousands):


	Amounts Recognized at the Acquisition Date
Assets Acquired
Cash and cash equivalents	$	97,362
Accounts receivable		55,495
Inventory		77,382
Prepaid expenses and other current assets		6,125
Property and equipment		1,242
Operating lease assets		481
Intangible assets		435,000
Total assets	$	673,087
Liabilities Assumed
Accounts payable	$	12
Accrued expenses		18,115
Accrued rebates, returns and discounts		56,261
Operating lease liabilities		481
Deferred tax liabilities		58,881
Total liabilities	$	133,750
Total identifiable net assets acquired		539,337
Goodwill		130,094
Total consideration transferred	$	669,431

The valuation of the acquired intangible assets is inherently subjective and relies on significant unobservable inputs. The Company used an income approach to value the $435,000 of intangible assets. The valuation for each of these intangible assets was based on estimated projections of expected cash flows to be generated by the assets, discounted to the present value at discount rates commensurate with risk. The Company is amortizing the identifiable intangible assets on a straight-line over their respective useful lives (refer to Note 9, Goodwill and Intangible Assets). In addition, the acquired inventory was recognized at its acquisition-date fair value, which resulted in an increase of $54,700 compared to its preacquisition book value.

The excess of the purchase price over the fair value of identifiable net assets acquired represents goodwill. This goodwill is primarily attributable to synergies of merging operations. The acquired goodwill is not deductible for tax purposes.

Total revenues attributable to BDSI from the Acquisition Date through June 30, 2022 were $50,362. However, earnings attributable to BDSI from the Acquisition Date through June 30, 2022 are not distinguishable due to the rapid integration of BDSI’s core operations into the Company.

Unaudited Pro Forma Summary of Operations

The following table shows the unaudited pro forma summary of operations for the three and six months ended June 30, 2022 and 2021, as if the BDSI Acquisition had occurred on January 1, 2021. This pro forma information does not purport to represent what the Company’s actual results would have been if the acquisition had occurred as of January 1, 2021, and is not indicative of what such results would be expected for any future period (in thousands, except per share amounts):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Total revenues	$	123,549	$	124,380	$	236,651	$	253,121
Net (loss) income	$	1,238	$	63,824	$	(18,950)	$	24,814

The unaudited pro forma financial information was prepared using the acquisition method of accounting and was based on the historical financial information of the Company and BDSI. The summary pro forma financial information primarily reflects the following pro forma adjustments:

●

The Company’s acquisition related transaction costs of $14,718 were reflected as of January 1, 2021

●

Employee severance related expense of $8,008 was reflected as of January 1, 2021

●

Additional amortization expense from the acquired intangibles

●

Additional cost of product revenues related to the step-up basis in inventory to record inventory at fair value; and

●

Adjustments to the Company’s interest expense related to repayment of the 2020 Term Notes and entering into the 2022 Term Loan as defined in Note 11, Term Notes Payable.

In addition, all of the above adjustments were adjusted for the applicable tax impact.

Acquisition Related Expenses

In the three and six months ended June 30, 2022, the Company incurred $3,579 and $30,746, respectively, of acquisition related expenses as a result of the BDSI Acquisition and the substantial majority were included in the Selling, general, and administrative expense in the condensed consolidated statements of operations. These costs include transaction costs, which primarily consisted of financial advisory, banking, legal, and regulatory fees, and other consulting fees, incurred to complete the acquisition; employee-related expenses (severance cost and benefits) for terminated employees after the acquisition, BDSI directors and officers insurance, and miscellaneous other acquisition expenses incurred. The Company has accrued $848 related to employee severance costs incurred as of June 30, 2022 but not yet paid. Additional charges related to severance or retention payments and payments of any remaining employee termination costs are not expected to be material. However, the Company expects to incur additional acquisition related expenses relating to consulting fees, contract termination costs, and other integration-related expenses during the remainder of 2022.


	Three Months Ended June 30, 2022		Six Months Ended June 30, 2022
Transaction costs	$	161	$	14,718
Employee-related expenses		1,389		8,008
BDSI directors and officers insurance		—		4,492
Other acquisition expenses		2,029		3,528
Total acquisition related expenses	$	3,579	$	30,746

Fair Value of Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2022

Fair Value of Financial Instruments

Schedule of financial instruments measured at fair value by level within fair value hierarchy


						Significant
				Quoted Prices		other		Significant
				in active		observable		unobservable
				markets		inputs		inputs
		Total		(Level 1)		(Level 2)		(Level 3)
June 30, 2022
Money market funds, included in cash equivalents	$	2,006	$	2,006	$	—	$	—

December 31, 2021
Money market funds, included in cash equivalents	$	45,078	$	45,078	$	—	$	—

Convertible Senior Notes (Tables)

6 Months Ended

Jun. 30, 2022

Debt Instrument [Line Items]

Summary of convertible notes outstanding


Principal	$	143,750
Less: unamortized issuance costs		(3,335)
Net carrying amount	$	140,415

Schedule of total interest expense recognized related to the convertible notes


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Contractual interest expense	$	943	$	943	$	1,887	$	1,887
Amortization of debt issuance costs		226		225		449		446
Total interest expense	$	1,169	$	1,168	$	2,336	$	2,333

Convertible senior notes

Debt Instrument [Line Items]

Schedule of principal repayments of debt


Years ended December 31,	Future Minimum Payments
2022	$	1,886
2023		3,773
2024		3,773
2025		3,773
2026		145,638
Total minimum payments	$	158,843
Less: interest		(15,093)
Less: unamortized issuance costs		(3,335)
Convertible senior notes	$	140,415

Nature of Business (Details)	1 Months Ended
Nature of Business (Details)	Feb. 29, 2020
Grnenthal \| Nucynta Purchase Agreement \| Nucynta Products
Royalty payment as percentage of annual net sales	14.00%

Revenue from Contracts with Customers - Product Revenue Provision and Allowance Categories (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021
Rebates and Incentives
Allowance categories
Balance at beginning of the period	$ 142,379	$ 132,775
Acquired from BDSI	38,074
Provision related to current period sales	233,089	179,571
Changes in estimate related to prior period sales	(481)	(441)
Credits/payments made	(244,356)	(178,508)
Balance at end of the period	168,705	133,397
Product Returns
Allowance categories
Balance at beginning of the period	54,617	23,779
Acquired from BDSI	18,187
Provision related to current period sales	16,675	7,491
Credits/payments made	(11,465)	(21,443)
Balance at end of the period	78,014	9,827
Trade Allowances and Chargebacks
Allowance categories
Balance at beginning of the period	13,226	19,055
Acquired from BDSI	7,575
Provision related to current period sales	59,211	42,059
Changes in estimate related to prior period sales	(37)
Credits/payments made	(52,939)	(33,764)
Balance at end of the period	$ 27,036	$ 27,350

Inventory (Tables)

6 Months Ended

Jun. 30, 2022

Inventory

Schedule of Inventory


	June 30,		December 31,
	2022		2021
Raw materials	$	7,914	$	3,685
Work in process		46,427		1,007
Finished goods		23,428		12,702
Total inventory	$	77,769	$	17,394

Acquisitions (Tables)

6 Months Ended

Jun. 30, 2022

Acquisitions

Schedule of consideration paid for acquisition

The total consideration paid for the BDSI acquisition was approximately $669.4 million consisting of the following (in thousands, except per share amounts):


Fair Value of Purchase Price Consideration	Amount
Fair value of purchase price consideration paid at closing:
Cash consideration for all outstanding shares of BDSI's common and preferred stock (103,235,298 shares acquired at $5.60 per share)	$	578,118
Cash consideration paid to settle RSUs and in-the-money options		28,309
Cash paid to settle BDSI debt		63,004
Total purchase consideration	$	669,431

Schedule of preliminary allocation of acquisition purchase price


	Amounts Recognized at the Acquisition Date
Assets Acquired
Cash and cash equivalents	$	97,362
Accounts receivable		55,495
Inventory		77,382
Prepaid expenses and other current assets		6,125
Property and equipment		1,242
Operating lease assets		481
Intangible assets		435,000
Total assets	$	673,087
Liabilities Assumed
Accounts payable	$	12
Accrued expenses		18,115
Accrued rebates, returns and discounts		56,261
Operating lease liabilities		481
Deferred tax liabilities		58,881
Total liabilities	$	133,750
Total identifiable net assets acquired		539,337
Goodwill		130,094
Total consideration transferred	$	669,431

Schedule of Unaudited Pro Forma Summary of Operations


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Total revenues	$	123,549	$	124,380	$	236,651	$	253,121
Net (loss) income	$	1,238	$	63,824	$	(18,950)	$	24,814

Schedule of acquisition related expenses


	Three Months Ended June 30, 2022		Six Months Ended June 30, 2022
Transaction costs	$	161	$	14,718
Employee-related expenses		1,389		8,008
BDSI directors and officers insurance		—		4,492
Other acquisition expenses		2,029		3,528
Total acquisition related expenses	$	3,579	$	30,746

Acquisitions - Estimated Fair Value of Net Assets Acquired (Details) - USD ($)	3 Months Ended
	Jun. 30, 2022	Mar. 22, 2022	Mar. 02, 2022
Liabilities Assumed
Goodwill	$ 130,094,000
BioDelivery Sciences International, Inc
Assets Acquired
Cash and cash equivalents		$ 97,362,000
Accounts receivable		55,495,000
Inventory		77,382,000
Prepaid expenses and other current assets		6,125,000
Property and equipment		1,242,000
Operating lease assets		481,000
Intangible assets		435,000,000
Total assets		673,087,000
Liabilities Assumed
Accounts payable		12,000
Accrued expenses		18,115,000
Accrued rebates, returns and discounts		56,261,000
Operating lease liabilities		481,000
Deferred tax liabilities		58,881,000
Total liabilities		133,750,000
Total identifiable net assets acquired		539,337,000
Goodwill		130,094,000
Total consideration transferred		$ 669,431,000
Increase in inventory	14,300,000
Decrease in intangible assets	(10,000,000)
Increase in accrued rebates, returns and discounts	3,916,000
Increase in prepaid expenses and other current assets	888,000
Decrease in accrued expenses	(502,000)
Increase in deferred tax liabilities	356,000
Net offsetting decrease to Goodwill	$ 1,418,000
Increase to inventory			$ 54,700

Acquisitions (Details) $ in Thousands	Mar. 22, 2022 USD ($)
BioDelivery Sciences International, Inc
Business Acquisition [Line Items]
Consideration paid	$ 669,431

Earnings Per Share - Anti-dilutive Securities (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Stock options
Anti-dilutive securities
Dilutive securities excluded from the calculation of diluted earnings per share (in shares)	2,230,895	1,416,696	2,230,895	1,415,431
Restricted stock units
Anti-dilutive securities
Dilutive securities excluded from the calculation of diluted earnings per share (in shares)	2,024,634	677,824	2,024,634	677,824
Performance share units
Anti-dilutive securities
Dilutive securities excluded from the calculation of diluted earnings per share (in shares)	447,770	392,220	447,770	392,220
Warrants
Anti-dilutive securities
Dilutive securities excluded from the calculation of diluted earnings per share (in shares)	1,041,667		1,041,667
Convertible senior notes
Anti-dilutive securities
Dilutive securities excluded from the calculation of diluted earnings per share (in shares)	4,925,134		4,925,134

Income Taxes (Tables)

6 Months Ended

Jun. 30, 2022

Income Taxes

Schedule of income tax (benefit) provision recognized


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Benefit from income taxes	$	(1,455)	$	(61,852)	$	(4,228)	$	(62,040)
Effective tax rate		21.9%		(562.8%)		18.8%		(234.4%)

License Agreements - Acquired product rights (Details) - Elyxyb asset purchase agreement $ in Thousands	Aug. 03, 2022 USD ($)	Mar. 22, 2022 USD ($) item
License Agreements [Line Items]
Amount payable	$ 9,000
Contingent consideration		$ 9,000
Number of sales milestone achievement \| item		6
Maximum consideration		$ 262,000
Minimum
License Agreements [Line Items]
Payment upon sales milestone achievement , Per Year		4,000
Sales milestone achievement		50,000
Maximum
License Agreements [Line Items]
Payment upon sales milestone achievement , Per Year		100,000
Sales milestone achievement		$ 1,000,000

Term Notes Payable - 2022 Term Loan (Details) - 2022 Term Loan - USD ($) $ in Thousands		3 Months Ended	6 Months Ended
	Mar. 22, 2022	Jun. 30, 2022	Jun. 30, 2022
Debt
Aggregate principal amount	$ 650,000
Debt maturity	48 months
Margin rate			9.80%
2023	$ 100,000
Remaining three years	550,000
Debt modification and transaction fee	173
Commitment and other fees	19,818
Note discounts	$ 2,049
Interest expense		$ 16,591	$ 18,414,000
Prepayment prior to the second-year anniversary
Debt
Prepayment premium percentage	2.00%
Prepayment on or after the second-year anniversary, but on or prior to the third-year anniversary
Debt
Prepayment premium percentage	1.00%
LIBOR
Debt
Floor rate	1.20%
Margin rate	7.50%

Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2022

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of Collegium Pharmaceutical, Inc. (a Virginia corporation) and its subsidiaries. The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial reporting and as required by Regulation S-X, Rule 10-01. Accordingly, they do not include all of the information and footnotes required by GAAP for complete consolidated financial statements.

In the opinion of the Company’s management, the accompanying unaudited Condensed Consolidated Financial Statements contain all adjustments (consisting of items of a normal and recurring nature) necessary to fairly present the financial position of the Company as of June 30, 2022, and the results of operations and cash flows for the three and six months ended June 30, 2022 and 2021. The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the full year.

The preparation of the Condensed Consolidated Financial Statements in accordance with GAAP requires the Company to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues, costs and expenses and the disclosure of contingent assets and liabilities in the Company’s consolidated financial statements and accompanying notes. Estimates in the Company’s consolidated financial statements include revenue recognition, including the estimates of product returns, units prescribed, discounts and allowances related to commercial sales of products, estimates of useful lives with respect to intangible assets, accounting for stock-based compensation, contingencies, impairment of intangible assets and tax valuation allowances. The Company bases estimates and assumptions on historical experience when available and on various factors that it believes to be reasonable under the circumstances. The Company evaluates its estimates and assumptions on an ongoing basis. The Company’s actual results may differ from these estimates under different assumptions or conditions. The consolidated interim financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s most recently filed Annual Report on Form 10-K for the fiscal year ended December 31, 2021 (the “Annual Report”).

Acquisitions

In a business combination, the acquisition method of accounting requires that the assets acquired and liabilities assumed be recorded as of the date of the acquisition at their respective fair values, with some exceptions. Assets acquired and liabilities assumed in a business combination that arise from contingencies are generally recognized at fair value. If fair value can be determined, the asset or liability is recognized; if fair value is not determinable, then no asset or liability is recognized. 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.

Any excess of the purchase price (consideration transferred) over the estimated fair values of net assets acquired is recorded as goodwill. Transaction costs and costs to restructure the acquired company are expensed as incurred. The operating results of the acquired business are reflected in the Company’s consolidated financial statements after the date of the acquisition.

Goodwill

Goodwill represents the excess of the purchase price over the estimated fair value of the net assets acquired in a business combination and is not amortized, but is subject to impairment testing at least annually or when a triggering event occurs that could indicate a potential impairment.

Research and Development Expenses

Research and development expenses have historically consisted of product development expenses incurred in identifying, developing, and testing product candidates. Product development expenses primarily consisted of labor, benefits, and related employee expenses for personnel directly involved in product development activities, fees paid to contract research organizations for managing clinical and non-clinical trials, and regulatory costs.

As of April 1, 2022, the Company focused entirely on commercial products rather than research and development and redirected resources from research and development activities. As such, there were no expenses incurred in research and development during the three months ended June 30, 2022.

Recently Adopted Accounting Pronouncements

New accounting pronouncements are issued periodically by the Financial Accounting Standards Board (“FASB”) and are adopted by the Company as required by the specified effective dates.

In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options. This ASU clarifies and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. The standard is effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2021 and may be applied prospectively to modifications or exchanges occurring on or after the effective date of the amendments. The Company adopted this standard effective January 1, 2022 and the adoption did not have a material impact on the Company’s condensed consolidated financial statements.

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU amends Accounting Standards Codification, or ASC, 805 to add contract assets and contract liabilities to the list of exceptions to the recognition and measurement principles that apply to business combinations and to require that an entity (acquirer) recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC Topic 606. As a result of the amendments made by the ASU, it is expected that an acquirer will generally recognize and measure acquired contract assets and contract liabilities in a manner consistent with how the acquiree recognized and measured them in its pre-acquisition financial statements. The ASU’s amendments are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The amendments should be applied prospectively to business combinations occurring on or after the effective date of the amendments. Early adoption of the amendments is permitted, including adoption in an interim period. An entity that early adopts in an interim period should apply the amendments (i) retrospectively to all business combinations for which the acquisition date occurs on or after the beginning of the fiscal year that includes the interim period of early application and (ii) prospectively to all business combinations that occur on or after the date of initial application. The Company adopted this standard effective January 1, 2022 and the adoption did not have a material impact on the Company’s condensed consolidated financial statements.

Recently Issued Accounting Pronouncements Not Yet Adopted

Other recent accounting pronouncements issued, but not yet effective, are not expected to be applicable to the Company or have a material effect on the consolidated financial statements upon future adoption.

Goodwill and Intangible Assets - Cost, accumulated amortization, and carrying amount of intangible assets (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Dec. 31, 2021
Finite-Lived Intangible Assets [Line Items]
Goodwill	$ 130,094
Cost	956,170	$ 521,170
Accumulated amortization	(308,871)	(252,447)
Carrying Amount	$ 647,299	268,723
Nucynta Products
Finite-Lived Intangible Assets [Line Items]
Amortization Period (Years)	8 years
Cost	$ 521,170	521,170
Accumulated amortization	(286,038)	(252,447)
Carrying Amount	$ 235,132	$ 268,723
Belbuca
Finite-Lived Intangible Assets [Line Items]
Amortization Period (Years)	4 years 9 months 18 days
Cost	$ 360,000
Accumulated amortization	(20,733)
Carrying Amount	$ 339,267
Symproic
Finite-Lived Intangible Assets [Line Items]
Amortization Period (Years)	9 years 7 months 6 days
Cost	$ 70,000
Accumulated amortization	(2,003)
Carrying Amount	$ 67,997
Elyxyb
Finite-Lived Intangible Assets [Line Items]
Amortization Period (Years)	14 years 2 months 12 days
Cost	$ 5,000
Accumulated amortization	(97)
Carrying Amount	$ 4,903

Summary of Significant Accounting Policies (Policies)	6 Months Ended
Summary of Significant Accounting Policies (Policies)	Jun. 30, 2022
Summary of Significant Accounting Policies
Basis of Presentation	Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of Collegium Pharmaceutical, Inc. (a Virginia corporation) and its subsidiaries. The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial reporting and as required by Regulation S-X, Rule 10-01. Accordingly, they do not include all of the information and footnotes required by GAAP for complete consolidated financial statements. In the opinion of the Company’s management, the accompanying unaudited Condensed Consolidated Financial Statements contain all adjustments (consisting of items of a normal and recurring nature) necessary to fairly present the financial position of the Company as of June 30, 2022, and the results of operations and cash flows for the three and six months ended June 30, 2022 and 2021. The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the full year. The preparation of the Condensed Consolidated Financial Statements in accordance with GAAP requires the Company to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues, costs and expenses and the disclosure of contingent assets and liabilities in the Company’s consolidated financial statements and accompanying notes. Estimates in the Company’s consolidated financial statements include revenue recognition, including the estimates of product returns, units prescribed, discounts and allowances related to commercial sales of products, estimates of useful lives with respect to intangible assets, accounting for stock-based compensation, contingencies, impairment of intangible assets and tax valuation allowances. The Company bases estimates and assumptions on historical experience when available and on various factors that it believes to be reasonable under the circumstances. The Company evaluates its estimates and assumptions on an ongoing basis. The Company’s actual results may differ from these estimates under different assumptions or conditions. The consolidated interim financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s most recently filed Annual Report on Form 10-K for the fiscal year ended December 31, 2021 (the “Annual Report”).
Acquisitions	Acquisitions In a business combination, the acquisition method of accounting requires that the assets acquired and liabilities assumed be recorded as of the date of the acquisition at their respective fair values, with some exceptions. Assets acquired and liabilities assumed in a business combination that arise from contingencies are generally recognized at fair value. If fair value can be determined, the asset or liability is recognized; if fair value is not determinable, then no asset or liability is recognized. 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. Any excess of the purchase price (consideration transferred) over the estimated fair values of net assets acquired is recorded as goodwill. Transaction costs and costs to restructure the acquired company are expensed as incurred. The operating results of the acquired business are reflected in the Company’s consolidated financial statements after the date of the acquisition.
Goodwill	Goodwill Goodwill represents the excess of the purchase price over the estimated fair value of the net assets acquired in a business combination and is not amortized, but is subject to impairment testing at least annually or when a triggering event occurs that could indicate a potential impairment.
Research and Development Expenses	Research and Development Expenses Research and development expenses have historically consisted of product development expenses incurred in identifying, developing, and testing product candidates. Product development expenses primarily consisted of labor, benefits, and related employee expenses for personnel directly involved in product development activities, fees paid to contract research organizations for managing clinical and non-clinical trials, and regulatory costs. As of April 1, 2022, the Company focused entirely on commercial products rather than research and development and redirected resources from research and development activities. As such, there were no expenses incurred in research and development during the three months ended June 30, 2022.
Recent Accounting Pronouncements	Recently Adopted Accounting Pronouncements New accounting pronouncements are issued periodically by the Financial Accounting Standards Board (“FASB”) and are adopted by the Company as required by the specified effective dates. In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options. This ASU clarifies and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. The standard is effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2021 and may be applied prospectively to modifications or exchanges occurring on or after the effective date of the amendments. The Company adopted this standard effective January 1, 2022 and the adoption did not have a material impact on the Company’s condensed consolidated financial statements. In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU amends Accounting Standards Codification, or ASC, 805 to add contract assets and contract liabilities to the list of exceptions to the recognition and measurement principles that apply to business combinations and to require that an entity (acquirer) recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC Topic 606. As a result of the amendments made by the ASU, it is expected that an acquirer will generally recognize and measure acquired contract assets and contract liabilities in a manner consistent with how the acquiree recognized and measured them in its pre-acquisition financial statements. The ASU’s amendments are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The amendments should be applied prospectively to business combinations occurring on or after the effective date of the amendments. Early adoption of the amendments is permitted, including adoption in an interim period. An entity that early adopts in an interim period should apply the amendments (i) retrospectively to all business combinations for which the acquisition date occurs on or after the beginning of the fiscal year that includes the interim period of early application and (ii) prospectively to all business combinations that occur on or after the date of initial application. The Company adopted this standard effective January 1, 2022 and the adoption did not have a material impact on the Company’s condensed consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted Other recent accounting pronouncements issued, but not yet effective, are not expected to be applicable to the Company or have a material effect on the consolidated financial statements upon future adoption.

Commitments and Contingencies

6 Months Ended

Jun. 30, 2022

Commitments and Contingencies

Commitments and Contingencies

15. Commitments and Contingencies

Legal Proceedings

From time to time, the Company may face legal claims or actions in the normal course of business. Except as disclosed below, the Company is not currently a party to any litigation and, accordingly, does not have any other amounts recorded for any litigation related matters.

Xtampza ER Litigation

The Company filed the NDA for Xtampza ER as a 505(b)(2) application, which allows the Company to reference data from an approved drug listed in the FDA’s Orange Book, in this case OxyContin. The 505(b)(2) process requires that the Company certify to the FDA that the Company does not infringe any of the patents listed for OxyContin in the Orange Book, or that the patents are invalid. The process also requires that the Company notify Purdue Pharma, L.P (“Purdue”), as the holder of the NDA, and any other Orange Book-listed patent owners that it has made such a certification. On February 11, 2015, the Company made the required certification documenting why Xtampza ER does not infringe any of the 11 Orange Book listed patents for OxyContin, five of which have been invalidated in court proceedings, and provided the required notice to Purdue. Under the Drug Price Competition and Patent Term Restoration Act of 1984, Purdue had the option to sue the Company for infringement and receive a stay of up to 30 months before the FDA could issue a final approval for Xtampza ER, unless the stay was earlier terminated.

In response to these actions, Purdue sued the Company for infringement in the District of Delaware on March 24, 2015 asserting infringement of three of Purdue’s Orange Book-listed patents (Patent Nos. 7,674,799, 7,674,800, and 7,683,072) and a non-Orange Book-listed patent (Patent No. 8,652,497), and accordingly, received a 30-month stay of FDA approval.

The Delaware court transferred the case to the District of Massachusetts. After the Company filed a partial motion for judgment on the pleadings relating to the Orange Book-listed patents, the District Court of Massachusetts ordered judgment in the Company’s favor on those three patents, and dismissed the claims asserting infringement of those patents with prejudice. Upon dismissal of those claims, the 30-month stay of FDA approval was lifted. As a result, the Company was able to obtain final approval for Xtampza ER and launch the product commercially.

Purdue subsequently filed two follow-on lawsuits asserting infringement of two patents that had been late-listed in the Orange Book and therefore could not trigger any stay of FDA approval: Purdue filed suit asserting infringement of Patent No. 9,073,933 in November 2015, and asserted infringement of Patent No. 9,522,919 in April 2017. In addition, Purdue filed suit on two patents that had not been listed in the Orange Book, filing suit in June 2016 asserting infringement of Patent No. 9,155,717 and in September 2017, asserting infringement of Patent No. 9,693,961.

On March 13, 2018, the Company filed a Petition for Post-Grant Review (“PGR”) of the ʼ961 patent with the Patent Trial and Appeal Board (“PTAB”). The PGR argues that the ʼ961 patent is invalid for lack of a written description, for lack of enablement, for indefiniteness, and as being anticipated by prior art. The PTAB held oral argument on the proceedings on July 10, 2019 and was scheduled to issue a decision on the patentability of the ʼ961 patent by no later than October 4, 2019. On September 15, 2019, Purdue commenced a voluntary case under chapter 11 of title 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York. On September 24, 2019, Purdue gave the PTAB notice of its bankruptcy filing and sought the imposition of an automatic

stay of the PGR proceedings. On October 2, 2019, the PTAB extended the one-year period for issuing its decision by up to six months.

In October 2017, and in response to the filing of the Company’s Supplemental NDA (“sNDA”) seeking to update the drug abuse and dependence section of the Xtampza ER label, Purdue filed another suit asserting infringement of the ʼ933 and ʼ919 patent. The Company filed a motion to dismiss that action, and the Court granted its motion on January 16, 2018.

A claim construction hearing was held on June 1, 2017. On November 21, 2017, the Court issued its claim construction ruling, construing certain claims of the ʼ933, ʼ497, and ʼ717 patents. The Court issued an order on September 28, 2018 in which it granted in part a motion for summary judgment that the Company filed. Specifically, the Court ruled that the Xtampza ER formulation does not infringe the ʼ497 and ʼ717 patents. On September 18, 2019, Purdue gave the Court notice of its bankruptcy filing and sought the imposition of an automatic stay of the proceedings. On September 20, 2019, the matter was stayed pending further order of the Court.

On September 1, 2020, the Bankruptcy Court entered an Order Granting Motions for Relief from the Automatic Stay, lifting the automatic stays in both the District of Massachusetts and PTAB proceedings. The Company appealed the Bankruptcy Court’s Order, in part, and that appeal is stayed, on consent by Purdue, pending the outcome of any appeal of the PTAB proceedings. On September 11, 2020, Purdue filed a motion to terminate the PTAB action on the basis that those proceedings had gone beyond the 18-month statutory period. The Company opposed Purdue’s motion. On November 19, 2021, the PTAB (i) denied Purdue’s motion to terminate the PGR and (ii) issued its Final Written Decision, finding that claims 1-17 of the ʼ961 patent were invalid for lack of written description and anticipation. On December 17, 2021, Purdue filed a Request for Director Review. That request was denied on February 7, 2022. On February 16, 2022, Purdue filed a Federal Circuit notice of appeal. On April 12, 2022, the Company filed a Motion to Dismiss the Appeal as Untimely. On May 20, 2022, the Federal Circuit denied the Motion to Dismiss and directed the parties to address jurisdiction during merits briefing.

On April 2, 2021, the Court granted Purdue’s Motion to Lift the Stay in the District of Massachusetts that was entered following Purdue’s Notice of Bankruptcy. On April 9, 2021, Purdue filed another follow-on lawsuit asserting infringement of U.S. Patent No. 10,407,434, which was late-listed in the Orange Book and therefore could not trigger any stay of FDA approval. The Company responded to Purdue’s complaint asserting the ’434 patent with a motion to dismiss. On May 21, 2021, and in response to the Company’s motion to dismiss, Purdue filed an amended complaint asserting the ’434 patent. The Company renewed its motion to dismiss on June 4, 2021, arguing: (i) Purdue cannot, as a matter of law, state a claim for infringement under § 271(e)(2)(A); (ii) Purdue cannot, as a matter of law, state a claim for product-by-process infringement under §271(g); and (iii) Purdue has not alleged facts sufficient to support any indirect infringement theory under §271(b) or (c). The Court held a hearing on the Company’s motion to dismiss on October 13, 2021, and the motion is pending before the Court.

Like the prior follow-on lawsuits, the ’434 patent litigation was consolidated into the lead case and a scheduling order was entered. On October 5, 2021, the Court held a claim construction hearing for the ʼ961 patent and the ʼ434 patent. On April 5, 2022, the Court set (i) the fact discovery deadline for November 4, 2022; and (ii) expert witness depositions to conclude by February 24, 2023. The Court has not set a deadline for dispositive motions or trial.

The remaining patents-in-suit in the lead consolidated action in the District of Massachusetts are the ʼ933, ʼ919, ʼ434, and ʼ961 patents. The parties agreed, however, that litigation concerning the ʼ961 patent is stayed pending resolution of Purdue’s Federal Circuit appeal of the PTAB decision invalidating the claims of the ʼ961 patent. Purdue has made a demand for monetary relief, and requested a judgment of infringement, an adjustment of the effective date of FDA approval, and an injunction on the sale of the Company’s products accused of infringement. The Company has denied all claims and has requested a judgment that the remaining asserted patents are invalid and/or not infringed; the Company is also seeking a judgment that the case is exceptional and has requested an award of the Company’s attorneys’ fees for defending the case.

The Company plans to defend this case vigorously. At this stage, the Company is unable to evaluate the likelihood of an unfavorable outcome or estimate the amount or range of potential loss, if any.

Nucynta Litigation

On February 7, 2018, Purdue filed a patent infringement suit against the Company in the District of Delaware. Specifically, Purdue argues that the Company’s sale of immediate-release and extended-release Nucynta infringes U.S. Patent Nos. 9,861,583, 9,867,784, and 9,872,836. Purdue has made a demand for monetary relief in its complaint but has not quantified its alleged damages.

On December 6, 2018, the Company filed an Amended Answer asserting an affirmative defense for patent exhaustion. On December 10, 2018, the Court granted the parties’ stipulation for resolution of the Company’s affirmative defense of patent exhaustion and stayed the action, with the exception of briefing on and resolution of the Company’s Motion for Judgment on the Pleadings related to patent exhaustion and any discovery related to that Motion. Also, on December 10, 2018, the Company filed a Rule 12(c) Motion for Judgment on the Pleadings, arguing that the Purdue’s claims were barred by the doctrine of patent exhaustion. On June 18, 2019, the Court heard oral argument on the Company’s Rule 12(c) Motion for Judgment on the Pleadings. On June 19, 2019, the Court issued an order stating that “judgment in Collegium’s favor is warranted under the doctrine of patent exhaustion to the extent Collegium’s alleged infringing activities resulted from sales that fall within the scope of that covenant.” The Court explained, however, that based on the current record, it was not possible “to determine whether title of the Nucynta Products was transferred to Collegium” from sales authorized by Purdue’s covenant not to sue. The Court ordered discovery on this issue and the case remained “stayed with the exception of discovery and briefing on and resolution of the Company’s anticipated motion for summary judgment based on patent exhaustion.”

On September 19, 2019, Purdue gave the Court notice of its bankruptcy filing and sought the imposition of an automatic stay of the proceedings. The Nucynta litigation is subject to the automatic bankruptcy stay.

Pending resolution of the bankruptcy action, the Company plans to defend this case vigorously. At this stage, the Company is unable to evaluate the likelihood of an unfavorable outcome or estimate the amount or range of potential loss, if any.

Litigation Related to the BDSI Acquisition

On February 25, 2022, in connection with the BDSI Acquisition, a purported individual stockholder of BDSI filed a complaint in the United States District Court for the Southern District of New York, captioned Stein v. BioDelivery Sciences International, Inc., et al., No. 1:22-cv-01600, naming as defendants BDSI and each member of its board of directors as of the date of the Merger Agreement (“Stein Action”). On February 28, 2022, two additional cases were filed by purported individual stockholders of BDSI in the same court, captioned Sanford v. BioDelivery Sciences International, Inc., et al., No. 1:22-cv-01676 (“Sanford Action”), and Higley v. BioDelivery Sciences International, Inc., et al., No. 1:22-cv-01658 (“Higley Action”). On March 2, 2022 and March 5, 2022, two additional cases were filed by purported individual stockholders of BDSI in the United States District Court for the Eastern District of New York, captioned Justice II v. BioDelivery Sciences International, Inc., et al., No. 1:22-cv-01145 (“Justice Action”) and Zomber v. BioDelivery Sciences International, Inc., et al., No. 1:22-cv-01220 (“Zomber Action”; together with the Stein, Sanford, Higley, and Justice Actions, the “Actions”). The Actions and any similar subsequently filed cases involving BDSI, its officers or board of directors, or any committee thereof, and/or any of the Company’s officers or directors relating directly or indirectly to the Merger Agreement, the BDSI Acquisition or any related transaction, are referred to as the “Merger Litigations.”

The Merger Litigations filed to date generally allege that the Schedule 14D-9 is materially incomplete and misleading by allegedly failing to disclose purportedly material information relating to the sale process leading to the Merger, BDSI’s financial projections, and the analyses performed by Moelis & Company LLC in connection with the Merger. The Merger Litigations assert violations of Section 14(e) of the Exchange Act and violations of Section 20(a) of the Exchange Act against BDSI’s board of directors. Additionally, the Stein, Higley, Justice, and Zomber complaints assert violations of Section 14(d) of the Exchange Act and Rule 14d-9 promulgated thereunder. The Merger Litigations seek, among other things: an injunction enjoining consummation of the Merger, rescission of the Merger Agreement, a declaration that BDSI and its board of directors violated Sections 14(e) and 20(a) of the Exchange Act and Rule 14a-9 promulgated thereunder, damages, costs of the action, including plaintiffs’ attorneys’ fees and experts’ fees and expenses, and any other relief the court may deem just and proper.

In addition, on February 24, 2022, February 28, 2022, and March 7, 2022, BDSI received demand letters from three purported stockholders of BDSI seeking to inspect certain books and records of BDSI related to the Merger (collectively, the “Inspection Letters”). On March 4, 2022, March 9, 2022, and March 11, 2022, BDSI received demand letters from

four purported stockholders alleging that the Schedule 14D-9 omits purportedly material information relating to the Merger (collectively, the “Demand Letters”).

On April 14, 2022, plaintiff in the Higley Action filed a notice of voluntary dismissal of the complaint. On May 15, 2022, plaintiff in the Zomber Action filed a notice of voluntary dismissal of the complaint. And, on June 24, 2022, plaintiff in the Justice Action filed a notice of voluntary dismissal of the complaint. In both of the remaining Stein and Sanford cases, on July 20, 2022, the respective Courts entered an Order for plaintiff to serve a summons and complaint by August 3, 2022.

While the Company believes that the remaining Merger Litigations, Inspection Letters, and Demand Letters are without merit and that the disclosures in the Schedule 14D-9 comply fully with applicable law, solely in order to avoid the expense and distraction of litigation, BDSI previously determined to voluntarily supplement the Schedule 14D-9 with certain supplemental disclosures set forth in BDSI’s Schedule 14D-9 filed with the SEC on March 11, 2022 (the “Supplemental Disclosures”). The Company and BDSI believe that the Supplemental Disclosures mooted all allegations or concerns raised in the Merger Litigations, Inspection Letters, and Demand Letters.

As set forth in the Supplemental Disclosures, nothing therein shall be deemed an admission of the legal necessity or materiality under applicable law of the Supplemental Disclosures. To the contrary, the Company and BDSI specifically deny all allegations that any of the Supplemental Disclosures, or any other additional disclosures, were or are required. The Company plans to defend the Merger Litigations vigorously. At this stage, the Company is unable to evaluate the likelihood of an unfavorable outcome or estimate the amount or range of potential loss, if any.

Opioid Litigation

As a result of the opioid epidemic, numerous state and local governments, healthcare providers, and other entities brought suit against manufacturers, wholesale distributors, and pharmacies alleging a variety of claims related to opioid marketing and distribution practices. In late 2017, the U.S. Judicial Panel on Multidistrict Litigation ordered the consolidation of what were then a few hundred cases pending around the country in federal court against opioid manufacturers and distributors into a Multi-District Litigation (“MDL”) in the Northern District of Ohio. Generally, these suits do not seek damages for injuries to individuals but rather compensation for the cost of public services needed to address the consequences of addicted communities, ranging from emergency response capabilities to rehabilitation services. The Company was named as a defendant in a small subset of the MDL cases. Of the 21 MDL cases that have named the Company as a defendant, the allegations against it were previously dismissed or withdrawn in 13 cases. As explained below, the remaining eight MDL cases that named the Company were dismissed as of April 19, 2022. In addition, the Company had been previously dismissed from three non-MDL cases filed in Pennsylvania and Arkansas state courts.

Outside of the MDL, there are several cases pending against the Company in state courts in Pennsylvania and Massachusetts:

●In Pennsylvania, six lawsuits naming the Company have been consolidated for discovery purposes in the Delaware County Court of Common Pleas as part of a consolidated proceeding of similar lawsuits brought by numerous Pennsylvania counties against other pharmaceutical manufacturers and distributors. These include lawsuits filed between May 2018 and July 2019 on behalf of Bucks County, Clinton County, Mercer County, Warrington Township, Warminster Township, and the City of Lock Haven, each of Pennsylvania, alleging claims related to opioid marketing and distribution, including negligence, fraud, unjust enrichment, public nuisance, and violations of state consumer protections laws. None of these cases has been designated a Track One case in which discovery would commence, and therefore they are all effectively stayed at present.

●In Massachusetts, there are lawsuits by the City of Worcester, the City of Salem, the City of Framingham, the Town of Lynnfield, the City of Springfield, the City of Haverhill, the City of Gloucester, the Town of Canton, the Town of Wakefield, the City of Chicopee, the Town of Natick, the City of Cambridge and the Town of Randolph, all of which have been consolidated before the Business Litigation Session of the Superior Court. The actions allege a variety of claims related to opioid marketing and distribution practices including public nuisance, common law fraud, negligent misrepresentation, negligence, violations of Mass Gen. Laws ch. 93A, Section 11, unjust enrichment and civil conspiracy. The case brought by the City of Springfield was selected to advance for the purpose of motion practice, defendants’ motions to dismiss were denied on

January 3, 2020. There is no trial date set for this case.

On December 24, 2021, the Company entered into a settlement framework with Scott+Scott Attorneys at Law, LLP (the “Scott Firm”), the law firm representing plaintiffs in each of the 27 cases described above. Pursuant to the terms of the settlement framework, which were later memorialized in a final settlement agreement, the Company agreed to pay an aggregate amount not to exceed $2,750 in exchange for the dismissal, with prejudice, of each plaintiff’s lawsuit against the Company and a release of claims related to such lawsuits. The settlement agreement has been executed by the Company and all 27 plaintiffs, and the amounts subject to the settlement agreement have been paid.

The Company entered into this settlement to efficiently resolve this litigation and does not admit any liability or acknowledge any wrongdoing in connection with the settlement agreement.

The parties have submitted appropriate motions to dismiss the Company with prejudice for each of the 27 cases. A notice of voluntary dismissal as to Collegium was filed in the MDL on April 19, 2022, which dismissed the Company from the eight remaining MDL cases that named it. In the consolidated Pennsylvania state court cases, a motion for leave to discontinue as to the Company was filed on April 11, 2022 for the six cases naming the Company, which has been granted. In Massachusetts state court, motions to dismiss the Company from the thirteen cases naming it were filed May 11, 2022. The Court endorsed all thirteen of these motions to dismiss on July 22, 2022, thereby dismissing the Company from those cases.

Ongoing BDSI Litigation Matters

BDSI’s ongoing litigations with Aquestive Therapeutics, Inc. (formerly MonoSol Rx, “Aquestive”) and Indivior PLC (formerly RB Pharmaceuticals Limited, “Indivior”) are provided below.

Litigation related to BUNAVAIL

On October 29, 2013, Reckitt Benckiser, Inc., Indivior PLC (formerly RB Pharmaceuticals Limited, “Indivior”), and Aquestive Therapeutics, Inc. (formerly MonoSol Rx, “Aquestive”) (collectively, the “RB Plaintiffs”) filed an action against BDSI relating to its BUNAVAIL product in the United States District Court for the Eastern District of North Carolina (“EDNC”) for alleged patent infringement. BUNAVAIL is a drug approved for the maintenance treatment of opioid dependence. The RB Plaintiffs claim that the formulation for BUNAVAIL, which has never been disclosed publicly, infringes its U.S. Patent No. 8,475,832 (the “‘832 Patent”). On May 21, 2014, the Court granted BDSI’s motion to dismiss.

On January 22, 2014, Aquestive initiated an inter partes review (“IPR”) on U.S. Patent No. 7,579,019, (the “‘019 Patent”). The PTAB upheld all claims of BDSI’s ‘019 Patent in 2015 and this decision was not appealed by Aquestive.

On September 20, 2014, BDSI filed a declaratory judgment action in the United States District Court for the EDNC requesting the Court to make a determination that BDSI’s BUNAVAIL product does not infringe the ‘832 Patent, U.S. Patent No. 7,897,080 (the “‘080 Patent”) and U.S. Patent No. 8,652,378 (the “‘378 Patent”). BDSI obtained a final written decision of invalidity of the ‘080 Patent in its entirety in an inter partes reexamination proceeding. BDSI obtained a final written decision of invalidity of all relevant claims of the ‘832 Patent in an IPR proceeding. In an IPR proceeding for the ‘378 Patent, in its decision not to institute the IPR proceeding, the PTAB construed the claims of the ‘378 Patent. Shortly thereafter, by joint motion of the parties, the ‘378 Patent was removed from the District Court action.

On June 6, 2016, in an unrelated case in which Indivior and Aquestive asserted the ‘832 Patent against other parties, the Delaware District Court entered an order invalidating other claims in the ‘832 Patent. Indivior and Aquestive did not appeal the Delaware Court’s holding that other claims of the ‘832 Patent are invalid. On February 10, 2021, the parties in BDSI’s EDNC declaratory judgment action filed a covenant by Indivior and Aquestive not to sue BDSI for infringement of the ‘832 Patent. In view of that covenant and the prior invalidation of the ‘080 patent, BDSI filed a notice of voluntary dismissal of its EDNC declaratory judgement action.

On September 22, 2014, the RB Plaintiffs filed an action against BDSI (and BDSI’s commercial partner) relating to BDSI’s BUNAVAIL product in the United States District Court for the District of New Jersey for alleged patent infringement. The RB Plaintiffs claim that BUNAVAIL, whose formulation and manufacturing processes have never been disclosed publicly, infringes its patent U.S. Patent No. 8,765,167 (the “‘167 Patent”).

On December 12, 2014, BDSI filed a motion to transfer the case from New Jersey to North Carolina and a motion to dismiss the case against its commercial partner. On October 28, 2014, BDSI filed multiple IPR petitions on certain claims of the ‘167 Patent. The USPTO instituted three of the four IPR petitions. The PTAB upheld the claims and denied collateral estoppel applied to the PTAB decisions in March 2016. BDSI appealed to Court of Appeals for the Federal Circuit. The USPTO intervened with respect to whether collateral estoppel applied to the PTAB.

On June 19, 2018, BDSI filed a motion to remand the case for further consideration by the PTAB in view of intervening authority. On July 31, 2018, the Federal Circuit vacated the decisions, and remanded the ‘167 Patent IPRs for further consideration on the merits.

On February 7, 2019, the PTAB issued three decisions on remand vacating institution of the three previously instituted IPRs of the ‘167 patent. On March 11, 2019, BDSI timely appealed the PTAB decisions on remand to U.S. Court of Appeal for the Federal Circuit. On March 20, 2019, Aquestive and Indivior moved to dismiss the appeal, and BDSI opposed that motion.

On August 29, 2019, a three-judge panel of the Court of Appeals for the Federal Circuit granted the motion and dismissed BDSI’s appeal. On September 30, 2019, BDSI filed a petition for an en banc rehearing of the order dismissing BDSI’s appeal by the full Federal Circuit Court of Appeals.

On January 13, 2020, by the Court of Appeals for the Federal Circuit denied BDSI’s petition for en banc rehearing of the dismissal of BDSI’s appeal relating to inter partes review proceedings on the ’167 patent. On June 11, 2020, BDSI filed a petition for certiorari seeking U.S. Supreme Court review of the Federal Circuit’s decision. On October 5, 2020, the U.S. Supreme Court denied BDSI’s petition for certiorari.

On May 18, 2021, the RB Plaintiffs filed an amended complaint dropping BDSI’s commercial partner from the action it began on September 22, 2014. On June 1, 2021, BDSI answered the amended complaint asserting counterclaims of non-infringement, invalidity, and unenforceability. On December 16, 2021, the parties completed claim construction briefing on the disputed claim terms of the ʼ167 patent. The Court has not set a date for the claim construction hearing. Fact discovery is set to close ninety days after the court issues its order on claim construction. Expert discovery is set to close 141 days after the close of fact discovery. The Court has not set a trial date. The Company plans to defend this case vigorously. At this stage, the Company is unable to evaluate the likelihood of an unfavorable outcome or estimate the amount or range of potential loss, if any.

Litigation related to BELBUCA

On January 13, 2017, Aquestive filed a complaint in the United States District Court for the District of New Jersey alleging BELBUCA infringes the ‘167 Patent. In lieu of answering the complaint, BDSI filed motions to dismiss the complaint and, in the alternative, to transfer the case to the EDNC. On July 25, 2017, the New Jersey Court administratively terminated the case pending the parties’ submission of a joint stipulation of transfer because the District of New Jersey was an inappropriate venue. This case was later transferred to the Delaware District Court. On October 31, 2017, BDSI filed motions to dismiss the complaint and, in the alternative, to transfer the case to the EDNC.

On October 16, 2018, denying the motion to dismiss as moot, the Delaware District Court granted BDSI’s motion to transfer the case to the EDNC. On November 20, 2018, BDSI moved the EDNC to dismiss the complaint for patent infringement for failure to state a claim for relief.

On August 6, 2019, the EDNC granted BDSI’s motion to dismiss, and dismissed the complaint without prejudice. On or about November 11, 2019, Aquestive refiled a complaint in the EDNC against BDSI alleging that BELBUCA infringes the ‘167 Patent. On January 13, 2020, in lieu of answering the complaint, BDSI filed a motion to dismiss the complaint. After that motion was denied, BDSI answered the complaint on April 16, 2020. Aquestive moved to dismiss BDSI’s counterclaim of unenforceability, but the court denied that motion.

On December 16, 2021, the parties completed claim construction briefing on the disputed claim terms of the ʼ167 patent. The Court has not set a date for the claim construction hearing. Fact discovery is set to close ninety days after the court issues its order on claim construction. Expert discovery is set to close 141 days after the close of fact discovery. The

Court has not set a trial date. The Company plans to defend this case vigorously. At this stage, the Company is unable to evaluate the likelihood of an unfavorable outcome or estimate the amount or range of potential loss, if any.

Chemo Research, S.L

On March 1, 2019, BDSI filed a complaint for patent infringement in United States District Court for the District of Delaware against Chemo Research, S.L., Insud Pharma S.L., IntelGenx Corp., and IntelGenx Technologies Corp. (collectively, the “Chemo Defendants”), asserting that the Chemo Defendants infringe its Orange Book listed patents for BELBUCA, including U.S. Patent Nos. 8,147,866 and 9,655,843, both expiring in July of 2027, and U.S. Patent No. 9,901,539 expiring December of 2032 (collectively, “the BEMA patents”). This complaint follows a receipt by BDSI on January 31, 2019, of a Notice Letter from Chemo Research S.L. stating that it has filed with the FDA an ANDA containing a Paragraph IV Patent Certification, for a generic version of BELBUCA Buccal Film in strengths 75 mcg, 150 mcg, 300 mcg, 450 mcg, and 900 mcg. Because BDSI initiated a patent infringement suit asserting the patents identified in the Notice Letter within 45 days after receipt, the FDA is prevented from approving the ANDA until the earlier of 30 months or a decision in the case that each of the patents is not infringed or invalid. On March 15, 2019, BDSI filed a complaint against the Chemo Defendants in the Federal District Court for the District of New Jersey asserting the same claims for patent infringement made in the Delaware lawsuit. On April 19, 2019, Defendants filed an answer to the Delaware complaint wherein they denied infringement of the ‘866, ‘843 and ‘539 patents and asserted counterclaims seeking declaratory relief concerning the alleged invalidity and non-infringement of such patents.

On April 25, 2019, BDSI voluntarily dismissed the New Jersey lawsuit given Defendants’ consent to jurisdiction in Delaware.

The trial to adjudicate issues concerning the validity of the Orange Book listed patents covering BELBUCA was held on March 1, 2021. Chemo did not participate in the bench trial. Instead, on February 26, 2021, Chemo agreed to be bound by the decision of the Court with respect to the validity of the BEMA patents from the March 1, 2021 trial with Alvogen. On December 20, 2021, the Court issued an opinion upholding the validity of claims in BDSI’s ‘866 patent, which expires in 2027, and claims in the ’539 patent, which expires in 2032, to which Chemo is bound. The bench trial to adjudicate issues concerning the Chemo Defendants’ infringement of the Orange Book patents was set to commence on April 25, 2022. On March 30, 2022, the Court vacated the trial and has not yet set a new trial date.

On August 1, 2022, BDSI received a second Paragraph IV certification notice letter from Chemo indicating that Chemo has amended its ANDA to include its generic version of the 600 mcg and 750 mcg strengths of Belbuca, in addition to the 300 mcg, 450 mcg, and 900 mcg strengths identified in the first Chemo Paragraph IV certification notice letter. BDSI has not yet responded to the latest Paragraph IV certification notice letter and cannot predict the timing or outcome of this matter or its impact on the other ongoing proceedings with Chemo.

The Company plans to litigate this case vigorously. At this stage, the Company is unable to evaluate the likelihood of an unfavorable outcome or estimate the amount or range of potential loss, if any.

Alvogen

On September 7, 2018, BDSI filed a complaint for patent infringement in United States District Court for the District of Delaware against Alvogen Pb Research & Development LLC, Alvogen Malta Operations Ltd., Alvogen Pine Brook LLC, Alvogen, Incorporated, and Alvogen Group, Incorporated (collectively, “Alvogen”), asserting that Alvogen infringes BDSI’s Orange Book listed patents for BELBUCA, including U.S. Patent Nos. 8,147,866 and 9,655,843, both expiring in July of 2027, and U.S. Patent No. 9,901,539, expiring in December of 2032 (collectively, “the BEMA patents”). This complaint follows receipt by BDSI on July 30, 2018 of a Paragraph IV Patent Certification from Alvogen stating that Alvogen had filed an ANDA with the FDA for a generic version of BELBUCA Buccal Film (75 mcg, 150 mcg, 300 mcg, 450 mcg, 600 mcg, 750 mcg and 900 mcg). Because BDSI initiated a patent infringement suit asserting the patents identified in the Paragraph IV notice within 45 days after receipt of the Paragraph IV Certification, the FDA is prevented from approving the ANDA until the earlier of 30 months or a decision in the case that each of the patents is not infringed or invalid.

The Court scheduled a bench trial to commence on November 9, 2020 to adjudicate issues concerning the validity of the BEMA patents. On October 6, 2020, the Court rescheduled the bench trial with Alvogen to commence on March 1, 2021. A three-day bench trial against Alvogen was conducted commencing on March 1, 2021. At the conclusion of trial, the

Court ordered the parties to submit post-trial briefs. Post-trial briefing was completed on May 26, 2021. BDSI subsequently moved the Court to strike (i.e., remove from the Court’s consideration) three patent invalidity defenses raised for the first time in Alvogen’s post-trial briefs and two documents improperly cited in Alvogen’s post-trial briefs. On June 28, 2021, the Court granted BDSI’s motion to strike in its entirety. In addition, on June 28, 2021, the Court enjoined Alvogen from launching its generic product until the Court issued its final decision on the merits.

On September 21, 2021, BDSI filed under seal a Motion for Order to Show Cause why Defendants Should not be Held in Contempt for Violating the Court Order of June 28, 2021 (the “Motion”). On June 28, 2021, citing the statute authorizing the Court to extend the 30-month stay under the Hatch-Waxman Act, the Court ordered Alvogen not to “launch” its generic product until it could reach a final decision on the merits in the case. In the Motion, BDSI contends that Alvogen violated the order of the United States District Court for the District of Delaware commencing in or about August 2021 by, among other things, offering the generic product for sale through five compendia / price reporting services, including First Databank, Medi-Span (Wolters Kluwer), Red Book, Gold Standard and ScriptPro. As alleged in the Motion, after Alvogen’s product launch, certain payers began declining insurance coverage for BDSI’s brand BELBUCA and directing use of Alvogen’s generic substitute and/or made it more difficult for patients to obtain insurance coverage for BELBUCA. In addition to filing the Motion, BDSI demanded that Alvogen withdraw its compendia listings. Alvogen claims to have withdrawn its compendia product listings on or about September 9, 2021.

On December 20, 2021, the Court issued an opinion upholding the validity of claims in BDSI’s ‘866 patent, which expires in 2027, and claims in the ’539 patent, which expires in 2032. Alvogen conceded infringement of those claims prior to the trial. The Court entered final judgment of infringement and of failure to prove invalidity on January 21, 2022. The final judgment entered in this case upholding the validity of claims of the ’866 and ’539 Orange Book listed patents extends the effective date of any final approval by the FDA of Alvogen’s ANDA until December 21, 2032, which is the expiration date of the ’539 patent, and enjoins Alvogen and those acting in concert with Alvogen from commercially manufacturing, using, selling, or offering for sale Alvogen’s ANDA products until December 21, 2032. Alvogen filed a motion to stay certain provisions of the final judgment in the Court. BDSI filed an opposition to Alvogen’s request for a stay. The Court retained jurisdiction to decide (i) Alvogen’s motion to stay the final judgment and (ii) BDSI’s motion for contempt.

Alvogen filed a notice of appeal to the Federal Circuit seeking to reverse the Court’s final judgment entered on January 21, 2022. Separately, BDSI has filed a cross-appeal to the Federal Circuit seeking to reverse the Court’s opinion that claims 3 and 10 of the ’866 patent and claims 8, 9 and 20 of the ’843 patent are invalid and thus Alvogen is not liable for infringement of those claims, as well as any other ruling decided adversely to BDSI.

As it has done in the past, the Company intends to vigorously defend its intellectual property against assertions of invalidity or non-infringement.

Opioid-Related Request and Subpoenas

The Company, like a number of other pharmaceutical companies, has received subpoenas or civil investigative demands related to opioid sales and marketing. The Company has received such subpoenas or civil investigative demands from the Offices of the Attorney General of each of Washington, New Hampshire, Maryland and Massachusetts.

On December 16, 2021, the Company entered into an Assurance of Discontinuance with the Massachusetts Attorney General (the “AoD”). Pursuant to the AoD, the Company provided certain assurances and agreed to pay the Massachusetts Attorney General $185, including $65 relating to that office’s costs of investigation, in exchange for closure of the investigation and a release of claims pertaining to the subject matter of the investigation. The Company is currently cooperating with each of the foregoing states in their respective investigations.

Inventory (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Inventory
Raw materials	$ 7,914	$ 3,685
Work in process	46,427	1,007
Finished goods	23,428	12,702
Total inventory	$ 77,769	$ 17,394

Goodwill and Intangible Assets - Roll Forward (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2022 USD ($)
Goodwill [Roll Forward]
Goodwill resulting from BDSI Acquisition	$ 130,094
Balance at June 30, 2022	$ 130,094

Goodwill and Intangible Assets - Amortization Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Finite-Lived Intangible Assets [Line Items]
Amortization expense	$ 37,501	$ 16,795	$ 56,424	$ 33,590
Nucynta Products
Finite-Lived Intangible Assets [Line Items]
Amortization expense	16,796	$ 16,795	33,591	$ 33,590
Belbuca
Finite-Lived Intangible Assets [Line Items]
Amortization expense	18,796		20,733
Symproic
Finite-Lived Intangible Assets [Line Items]
Amortization expense	1,821		2,003
Elyxyb
Finite-Lived Intangible Assets [Line Items]
Amortization expense	$ 88		$ 97

Revenue from Contracts with Customers

6 Months Ended

Jun. 30, 2022

Revenue from Contracts with Customers

Revenue from Contracts with Customers

3. Revenue from Contracts with Customers

The Company’s revenue to date is from sales of the Company’s products, which are primarily sold to wholesalers (“customers”), which in turn sell the product to pharmacies for the treatment of patients (“end users”).

Revenue Recognition

In accordance with ASC Topic 606, Revenue from Contracts with Customers, (“ASC 606”) the Company recognizes revenue when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC Topic 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC Topic 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

The Company expenses incremental costs of obtaining a contract as and when incurred if the expected amortization period of the assets is one year or less.

Performance Obligations

The Company determined that performance obligations are satisfied, and revenue is recognized when a customer takes control of the Company’s product, which occurs at a point in time. This generally occurs upon delivery of the products to customers, at which point the Company recognizes revenue and records accounts receivable. Payment is typically received 30 to 90 days after satisfaction of the Company’s performance obligations.

Transaction Price and Variable Consideration

Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products or services to a customer (“transaction price”). The transaction price for product sales includes variable consideration related to sales deductions, including (1) rebates and incentives, including managed care rebates, government rebates, co-pay program incentives, and sales incentives and allowances; (2) product returns, including return estimates; and, (3) trade allowances and chargebacks, including fees for distribution service fees, prompt pay discounts, and chargebacks. The Company will estimate the amount of variable consideration that should be included in the transaction price under the expected value method for all sales deductions other than trade allowances, which are estimated under the most likely amount method. These provisions reflect the expected amount of consideration to which the Company is entitled based on the terms of the contract. In addition, the Company made a policy election to exclude from the measurement of the transaction price all taxes that are assessed by a governmental authority that are imposed on revenue-producing transactions.

The Company bases its estimates of variable consideration, which could include estimates of future rebates, returns, and other adjustments, on historical data and other information. Estimates include: (i) timing of the rebates and returns incurred, (ii) pricing adjustments related to rebates and returns, and (iii) the quantity of product that will be rebated or returned in the future. Significant judgment is used in determining the appropriateness of these assumptions at each reporting period.

Provisions for rebates and incentives are based on the estimated amount of rebates and incentives to be claimed on the related sales. As the Company’s rebates and incentives are based on products dispensed to patients, the Company is required to estimate the expected value of claims at the time of product delivery to wholesalers. Given that wholesalers sell the product to pharmacies, which in turn dispense the product to patients, claims can be submitted significantly after

the related sales are recognized. The Company’s estimates of these claims are based on the historical experience of existing or similar programs, including current contractual and statutory requirements, specific known market events and trends, industry data, and estimated distribution channel inventory levels. Accruals and related reserves required for rebates and incentives are adjusted as new information becomes available, including actual claims. If actual results vary, the Company may need to adjust future estimates, which could have an effect on earnings in the period of the adjustment.

Provisions for trade allowances and chargebacks are primarily based on customer-level contractual terms. Accruals and related reserves are adjusted as new information becomes available, which generally consists of actual trade allowances and chargebacks processed relating to sales recognized.

Provisions for product returns are based on product-level returns rates, recent unprocessed return claims, as well as relevant market events and other factors. Estimates of the future product returns are made at the time of revenue recognition to determine the amount of consideration to which the Company expects to be entitled (that is, excluding the products expected to be returned). To the extent the Company receives amounts in excess of what it expects to be entitled to receive due to a product return, the Company does not recognize revenue when it transfers products to customers but instead recognizes those excess amounts received as a refund liability. The Company updates the measurement of the refund liability at the end of each reporting period for changes in expectations about the amount of refunds with the corresponding adjustments recognized as revenue (or reductions of revenue).

Historically, estimates of the refund liability for Xtampza product returns were based on a combination of historical actual returns processed to date, taking into consideration the expiration date of product upon delivery to customers, as well as forecasted customer buying and return patterns, channel inventory levels, and other specifically known market events and trends. Sales of Xtampza increased significantly starting in 2018; as a result, the majority of Xtampza sold to customers by the Company had not been eligible for return until the year ended December 31, 2021, or beyond. For the Nucynta Products, estimates of the refund liability for product returns were based on historical returns rates as these products have been commercially sold in the U.S. since 2009 for Nucynta IR and since 2011 for Nucynta ER. Because the Company began selling the Nucynta Products in 2018, most of the Nucynta Products sold to customers by the Company were not eligible for return until the year ended December 31, 2021, or beyond.

The Company provides the right of return to its customers for an 18-month window beginning six months prior to expiration and up until twelve months after expiration. The Company’s customers short-pay an existing invoice upon notice of a product return claim. Adjustments to the preliminary short-paid claims are processed when the return claim is validated and finalized. For Xtampza and the Nucynta Products, the Company’s return policy requires that product is physically returned within the 18-month window.

2021 Returns Adjustment

During the year ended December 31, 2021, there were unprecedented and significant disruptions in the processing of product returns. Specifically, the Company’s customers, via the third-party returns processor that they and many pharmacies engage to process the majority of the Company’s product returns, failed to return products to the Company in the ordinary course. The value of actual returned product during the year ended December 31, 2021 represented less than 20% of the value of the product returns claimed during that period. Due to the failure of the customers and their vendor to return product timely in the ordinary course, the Company did not physically receive returned products corresponding to the substantial majority of the returns claimed and could not validate or finalize customer return claims, nor determine if the return was or would be eligible for refund upon the physical return. The lack of timely processing of requested product returns obscures information related to the validation of product returns and increases uncertainty related to the actual volume of product that will be physically returned and credited in accordance with the Company’s returns policy.

During the fourth quarter of 2021, after significant and sustained efforts with customers to resolve the unprocessed return claims, the Company formally denied a significant portion of these claims under the Company’s return policy. The Company subsequently received payment for only a portion of the denied claims and intends to vigorously pursue collections of the full amount of these short-pay receivables. Additional unprocessed return claims have and are expected to continue to expire prior to their physical return.

Although the Company has denied and expects to continue to deny credit for product returns that are not in accordance with its return policy, uncertainty exists related to the ultimate resolution of these claims. At the end of each reporting

period, the Company updates the estimated transaction price (including updating its assessment of whether an estimate of variable consideration is constrained) to represent faithfully the circumstances present at the end of the reporting period and the changes in circumstances during the reporting period. Variable consideration, including the risk of customer concessions, is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty is subsequently resolved. In particular, resolution of the unprocessed return claims includes the risk of concession for those that are outside of the Company’s return policy. There were no material adjustments related to these estimates in the three and six months ended June 30, 2022.

Significant judgment is required to determine the variable consideration included in the transaction price as described above. Adjustments to the estimated variable consideration included in the transaction price occurs when new information indicates that the estimate should be revised. If the value of accepted and processed claims is different than the amount estimated and included in variable consideration, then adjustments would impact product revenue, net and earnings in the period such revisions become known. The amount of variable consideration ultimately received and included in the transaction price may materially differ from the Company’s estimates, resulting in additional adjustments recorded to increase or decrease product revenue, net.

Summary of Activity in Product Revenue Provision and Allowance Categories

The following tables summarize activity in each of the Company’s product revenue provision and allowance categories for the six months ended June 30, 2022 and 2021:


					Trade
	Rebates and		Product		Allowances and
	Incentives (1)		Returns (2)		Chargebacks (3)
Balance at December 31, 2021	$	142,379	$	54,617	$	13,226
Acquired from BDSI		38,074		18,187		7,575
Provision related to current period sales		233,089		16,675		59,211
Changes in estimate related to prior period sales		(481)		—		(37)
Credits/payments made		(244,356)		(11,465)		(52,939)
Balance at June 30, 2022	$	168,705	$	78,014	$	27,036


					Trade
	Rebates and		Product		Allowances and
	Incentives (1)		Returns (2)		Chargebacks (3)
Balance at December 31, 2020	$	132,775	$	23,779	$	19,055
Provision related to current period sales		179,571		7,491		42,059
Changes in estimate related to prior period sales		(441)		—		—
Credits/payments made		(178,508)		(21,443)		(33,764)
Balance at June 30, 2021	$	133,397	$	9,827	$	27,350

(1)

Provisions for rebates and incentives includes managed care rebates, government rebates and co-pay program incentives. Provisions for rebates and incentives are deducted from gross revenues at the time revenues are recognized and are included in accrued rebates, returns and discounts in the Company’s Consolidated Balance Sheets.

(2)

Provisions for product returns are deducted from gross revenues at the time revenues are recognized and are included in accrued rebates, returns and discounts in the Company’s Consolidated Balance Sheets.

(3)

Provisions for trade allowances and chargebacks include fees for distribution service fees, prompt pay discounts, and chargebacks. Trade allowances and chargebacks are deducted from gross revenue at the time revenues are recognized and are recorded as a reduction to accounts receivable in the Company’s Consolidated Balance Sheets.

As of June 30, 2022, the Company did not have any transaction price allocated to remaining performance obligations and any costs to obtain contracts with customers, including pre-contract costs and set up costs, were immaterial.

Disaggregation of Revenue

The Company discloses disaggregated revenue from contracts with customers into categories that depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. When selecting the type of category to use to disaggregate revenue, the Company considers how information about the Company’s revenue has been presented for other purposes as well as what information is regularly reviewed and used for evaluating financial performance. As such, the Company disaggregates its product revenue, net from contracts with customers by product, as disclosed in the table below.


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Belbuca	$	42,301	$	—	$	45,611	$	—
Xtampza ER		33,190		33,023		64,708		68,432
Nucynta IR		26,554		29,241		55,889		59,767
Nucynta ER		17,077		20,678		36,340		42,464
Symproic		3,860		—		4,160		—
Elyxyb		109		—		134		—
Other		458		—		458		—
Total product revenues, net	$	123,549	$	82,942	$	207,300	$	170,663

The Company began recognizing revenue from net product sales of Belbuca, Symproic, and Elyxyb following the Acquisition Date.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI http://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (e)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

+ Details

Inventory

6 Months Ended

Jun. 30, 2022

Inventory

Inventory

8. Inventory

Inventory as of June 30, 2022 and December 31, 2021 consisted of the following:


	June 30,		December 31,
	2022		2021
Raw materials	$	7,914	$	3,685
Work in process		46,427		1,007
Finished goods		23,428		12,702
Total inventory	$	77,769	$	17,394

The aggregate charges related to excess inventory for the three and six months ended June 30, 2022 and 2021 were immaterial. These expenses were recorded as a component of cost of product revenues.

Earnings Per Share

6 Months Ended

Jun. 30, 2022

Earnings Per Share

Earnings Per Share

6. Earnings Per Share

Basic earnings per share is calculated by dividing the net (loss) income by the weighted-average number of shares of common stock outstanding during the period, without consideration for potentially dilutive securities. Diluted earnings per share is computed by dividing the net (loss) income by the weighted-average number of shares of common stock, plus potentially dilutive securities outstanding for the period, as determined in accordance with the treasury stock, if-converted, or contingently issuable accounting methods, depending on the nature of the security. For purposes of the diluted earnings per share calculation, stock options, restricted stock units (“RSUs”), performance share units (“PSUs”),

and shares potentially issuable in connection with our employee stock purchase plan and convertible senior notes are considered potentially dilutive securities and included to the extent that their addition is not anti-dilutive.

The following table presents the computations of basic and dilutive earnings per common share:


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Numerator:
Net (loss) income	$	(5,191)	$	72,843	$	(18,260)	$	88,505
Adjustment for interest expense recognized on convertible senior notes:		—		1,168		—		2,333
Net (loss) income - diluted	$	(5,191)	$	74,011	$	(18,260)	$	90,838
Denominator:
Weighted-average shares outstanding — basic		34,001,553		35,302,608		33,838,638		35,128,144
Effect of dilutive securities:
Stock options		—		580,329		—		624,602
Restricted stock units		—		302,737		—		384,908
Performance share units		—		—		—		—
Employee stock purchase plan		—		125		—		1,149
Warrants		—		175,920		—		187,812
Convertible senior notes		—		4,925,134		—		4,925,134
						—
Weighted average shares outstanding — diluted		34,001,553		41,286,853		33,838,638		41,251,749

(Loss) earnings per share — basic	$	(0.15)	$	2.06	$	(0.54)	$	2.52
(Loss) earnings per share — diluted	$	(0.15)	$	1.79	$	(0.54)	$	2.20

The Company has the option to settle the conversion obligation for its convertible senior notes due in 2026 in cash, shares or a combination of the two. The Company uses the if-converted method for the convertible senior notes.

The following table presents dilutive securities excluded from the calculation of diluted earnings per share:


	Three Months Ended June 30,		Six Months Ended June 30,
	2022	2021	2022	2021
Stock options	2,230,895	1,416,696	2,230,895	1,415,431
Restricted stock units	2,024,634	677,824	2,024,634	677,824
Performance share units	447,770	392,220	447,770	392,220
Employee stock purchase plan	—	—	—	—
Warrants	1,041,667	—	1,041,667	—
Convertible senior notes	4,925,134	—	4,925,134	—

For PSUs, these securities were excluded from the calculation of diluted earnings per share as the performance-based or market-based vesting conditions were not met as of the end of the reporting period. All other securities presented in the table above were excluded from the calculation of diluted earnings per share as their inclusion would have had an antidilutive effect.

Goodwill and Intangible Assets - Future Amortization Expense (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Finite-Lived Intangible Assets [Line Items]
2022	$ 75,104
2023	150,211
2024	150,211
2025	150,210
2026	83,030
Thereafter	38,533
Intangible asset, net	647,299	$ 268,723
Nucynta Products
Finite-Lived Intangible Assets [Line Items]
2022	33,590
2023	67,181
2024	67,181
2025	67,180
Intangible asset, net	235,132	$ 268,723
Belbuca
Finite-Lived Intangible Assets [Line Items]
2022	37,695
2023	75,393
2024	75,393
2025	75,393
2026	75,393
Intangible asset, net	339,267
Symproic
Finite-Lived Intangible Assets [Line Items]
2022	3,643
2023	7,285
2024	7,285
2025	7,285
2026	7,285
Thereafter	35,214
Intangible asset, net	67,997
Elyxyb
Finite-Lived Intangible Assets [Line Items]
2022	176
2023	352
2024	352
2025	352
2026	352
Thereafter	3,319
Intangible asset, net	$ 4,903

Stock-based Compensation

6 Months Ended

Jun. 30, 2022

Stock-based Compensation

Stock-based Compensation

14. Stock-based Compensation

Performance Share Units, Restricted Stock Units and Stock Options

Performance Share Units

The Company periodically grants PSUs to certain members of the Company's senior management team. PSUs vest subject to the satisfaction of annual and cumulative performance and/or market conditions established by the Compensation Committee.

A summary of the Company’s PSU activity for the six months ended June 30, 2022 and related information is as follows:


		Weighted-Average
	Shares	Grant Date Fair Value
Outstanding at December 31, 2021	353,100	$	31.77
Granted	241,550		24.12
Vested	(126,081)		29.12
Forfeited	(22,104)		29.60
Performance adjustment	1,305		28.96
Outstanding at June 30, 2022	447,770	$	28.71

The number of PSUs granted represents the target number of shares of common stock that may be earned. However, the actual number of shares earned may vary based on the satisfaction of performance criteria. The weighted-average grant date fair value of PSUs granted for the six months ended June 30, 2022, and 2021 was $24.12 and $35.15, respectively.

Restricted Stock Units

The Company granted RSUs to employees during the six months ended June 30, 2022. The Company’s RSUs generally vest ratably over a four-year period of service. A summary of the Company’s RSU activity for the six months ended June 30, 2022 and related information is as follows:


		Weighted-Average
	Shares	Grant Date Fair Value
Outstanding at December 31, 2021	1,620,023	$	22.48
Granted	1,241,897		17.48
Vested	(548,025)		22.09
Forfeited	(289,261)		20.72
Outstanding at June 30, 2022	2,024,634	$	19.76

The weighted-average grant date fair value per share of RSUs granted for the six months ended June 30, 2022 and 2021 was $17.48 and $24.37, respectively. The total fair value of RSUs vested (measured on the date of vesting) for the six months ended June 30, 2022, and 2021 was $9,697 and $10,515, respectively.

Stock Options

A summary of the Company’s stock option activity for the six months ended June 30, 2022 and related information is as follows:


				Weighted-
			Weighted-	Average
			Average	Remaining		Aggregate
			Exercise Price	Contractual		Intrinsic
	Shares		per Share	Term (in years)		Value
Outstanding at December 31, 2021	2,728,169	$	18.33	5.8	$	6,070
Granted	—		—
Exercised	(292,357)		16.44
Cancelled	(204,917)		21.81
Outstanding at June 30, 2022	2,230,895	$	18.26	5.7	$	4,040
Exercisable at June 30, 2022	1,948,941	$	18.19	5.5	$	3,724

The weighted-average grant date fair value per share of stock options granted for the six months ended June 30, 2021 was $12.60.

Employee Stock Purchase Plan

The Company’s 2015 Employee Stock Purchase Plan allows employees to purchase shares of the Company’s common stock. The purchase price is equal to 85% of the lower of the closing price of the Company’s common stock on (1) the first day of the purchase period or (2) the last day of the purchase period. During the sixth months ended June 30, 2022, 13,421 shares of common stock were purchased for total proceeds of $203. The expense for the three months ended June 30, 2022 and 2021 was $28 and $65, respectively. The expense for the six months ended June 30, 2022 and 2021 was $60 and $137, respectively.

Stock-based Compensation Expense

A summary of the Company’s stock-based compensation expense was allocated as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Research and development	$	—	$	1,248	$	1,591	$	2,465
Selling, general and administrative		5,692		5,268		10,236		10,930
Total stock-based compensation expense	$	5,692	$	6,516	$	11,827	$	13,395

At June 30, 2022, there was approximately $43,096 of unrecognized compensation expense related to unvested options, restricted stock units and performance stock units, which is expected to be recognized as expense over a weighted average period of approximately 2.6 years.

Equity - Changes in Shareholders' Equity (Details) - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2022	Jun. 30, 2021
Balance at beginning of period	$ 196,076	$ 202,928	$ 170,035	$ 186,031	$ 202,928	$ 186,031
Exercise of common stock options	1,545	3,261	4,093	4,102
Issuance for employee stock purchase plan		203		358
Vesting of RSUs and PSUs	1
Shares withheld for employee taxes upon vesting of RSUs and PSUs	(511)	(3,382)	(421)
Shares withheld for employee taxes upon vesting of RSUs and PSUs				(3,508)
Stock-based compensation	5,692	6,135	6,516	6,879
Net (loss) income	(5,191)	(13,069)	72,843	15,662	(18,260)	88,505
Balance at end of period	197,612	196,076	253,066	170,035	197,612	253,066
Adjustment.
Balance at beginning of period				(39,489)		(39,489)
Common stock
Balance at beginning of period	$ 36	$ 36	$ 35	$ 35	$ 36	$ 35
Balance at beginning of period, shares	36,380,997	35,806,119	35,203,824	34,612,054	35,806,119	34,612,054
Exercise of common stock options			$ 1
Exercise of common stock options, shares	102,283	190,074	273,127	289,164
Issuance for employee stock purchase plan, shares		13,421		24,630
Vesting of RSUs and PSUs	$ 1
Vesting of RSUs and PSUs, shares	111,056	563,050	65,107	413,538
Shares withheld for employee taxes upon vesting of RSUs and PSUs, shares	(26,506)	(191,667)	(18,141)
Shares withheld for employee taxes upon vesting of RSUs and PSUs				(135,562)
Balance at end of period	$ 37	$ 36	$ 36	$ 35	$ 37	$ 36
Balance at end of period, shares	36,567,830	36,380,997	35,523,917	35,203,824	36,567,830	35,523,917
Additional Paid-In Capital
Balance at beginning of period	$ 513,312	$ 502,095	$ 482,197	$ 519,143	$ 502,095	$ 519,143
Exercise of common stock options	1,545	3,261	4,092	4,102
Issuance for employee stock purchase plan		203		358
Shares withheld for employee taxes upon vesting of RSUs and PSUs	(511)	(3,382)	(421)
Shares withheld for employee taxes upon vesting of RSUs and PSUs				(3,508)
Share repurchases		5,000
Stock-based compensation	5,692	6,135	6,516	6,879
Balance at end of period	520,038	513,312	492,384	482,197	520,038	492,384
Additional Paid-In Capital \| Adjustment.
Balance at beginning of period				(44,777)		(44,777)
Treasury Stock, at cost
Balance at beginning of period	$ (47,861)	$ (42,861)			$ (42,861)
Balance at beginning of period, shares	(2,457,849)	(2,150,717)			(2,150,717)
Share repurchases		$ (5,000)
Share repurchases (in shares)		(307,132)
Balance at end of period	$ (47,861)	$ (47,861)			$ (47,861)
Balance at end of period, shares	(2,457,849)	(2,457,849)			(2,457,849)
Accumulated Deficit
Balance at beginning of period	$ (269,411)	$ (256,342)	(312,197)	(333,147)	$ (256,342)	(333,147)
Net (loss) income	(5,191)	(13,069)	72,843	15,662
Balance at end of period	$ (274,602)	$ (269,411)	$ (239,354)	(312,197)	$ (274,602)	(239,354)
Accumulated Deficit \| Adjustment.
Balance at beginning of period				$ 5,288		$ 5,288

Stock-based Compensation (Tables)

6 Months Ended

Jun. 30, 2022

Stock-based Compensation

Summary of performance share units activity


		Weighted-Average
	Shares	Grant Date Fair Value
Outstanding at December 31, 2021	353,100	$	31.77
Granted	241,550		24.12
Vested	(126,081)		29.12
Forfeited	(22,104)		29.60
Performance adjustment	1,305		28.96
Outstanding at June 30, 2022	447,770	$	28.71

Summary of restricted stock units activity


		Weighted-Average
	Shares	Grant Date Fair Value
Outstanding at December 31, 2021	1,620,023	$	22.48
Granted	1,241,897		17.48
Vested	(548,025)		22.09
Forfeited	(289,261)		20.72
Outstanding at June 30, 2022	2,024,634	$	19.76

Summary of stock option activity


				Weighted-
			Weighted-	Average
			Average	Remaining		Aggregate
			Exercise Price	Contractual		Intrinsic
	Shares		per Share	Term (in years)		Value
Outstanding at December 31, 2021	2,728,169	$	18.33	5.8	$	6,070
Granted	—		—
Exercised	(292,357)		16.44
Cancelled	(204,917)		21.81
Outstanding at June 30, 2022	2,230,895	$	18.26	5.7	$	4,040
Exercisable at June 30, 2022	1,948,941	$	18.19	5.5	$	3,724

Summary of stock-based compensation


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Research and development	$	—	$	1,248	$	1,591	$	2,465
Selling, general and administrative		5,692		5,268		10,236		10,930
Total stock-based compensation expense	$	5,692	$	6,516	$	11,827	$	13,395

Earnings Per Share - Computation of Net Earnings (Loss) per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2022	Jun. 30, 2021
EARNINGS PER SHARE
Net (loss) income	$ (5,191)	$ (13,069)	$ 72,843	$ 15,662	$ (18,260)	$ 88,505
Adjustment for interest expense recognized on convertible senior notes:			1,168			2,333
Net (loss) income - diluted	$ (5,191)		$ 74,011		$ (18,260)	$ 90,838
Weighted-average shares outstanding - basic	34,001,553		35,302,608		33,838,638	35,128,144
Weighted-average shares outstanding - diluted (in shares)	34,001,553		41,286,853		33,838,638	41,251,749
(Loss) earnings per share - basic (in dollars per share)	$ (0.15)		$ 2.06		$ (0.54)	$ 2.52
(Loss) earnings per share - diluted (in dollars per share)	$ (0.15)		$ 1.79		$ (0.54)	$ 2.20
Stock options
EARNINGS PER SHARE
Effect of dilutive securities:			580,329			624,602
Restricted stock units
EARNINGS PER SHARE
Effect of dilutive securities:			302,737			384,908
Employee stock purchase program
EARNINGS PER SHARE
Effect of dilutive securities:			125			1,149
Warrants
EARNINGS PER SHARE
Effect of dilutive securities:			175,920			187,812
Convertible senior notes
EARNINGS PER SHARE
Effect of dilutive securities:			4,925,134			4,925,134

Equity (Tables)

6 Months Ended

Jun. 30, 2022

Equity

Summary of changes in Shareholders' Equity

The changes in shareholders’ equity for the three and six months ended June 30, 2022 were as follows:


				Additional							Total
	Common Stock			Paid- In		Treasury Stock			Accumulated		Shareholders’
	Shares		Amount	Capital		Shares		Amount	Deficit		Equity
Balance, December 31, 2021	35,806,119	$	36	$	502,095	(2,150,717)	$	(42,861)	$	(256,342)	$	202,928
Exercise of common stock options	190,074		—		3,261	—		—		—		3,261
Issuance for employee stock purchase plan	13,421		—		203	—		—		—		203
Vesting of RSUs and PSUs	563,050		—		—	—		—		—		—
Shares withheld for employee taxes upon vesting of RSUs and PSUs	(191,667)		—		(3,382)	—		—		—		(3,382)
Share repurchases from Accelerated Share Repurchase ("ASR") agreement	—		—		5,000	(307,132)		(5,000)		—		—
Stock-based compensation	—		—		6,135	—		—		—		6,135
Net loss	—		—		—	—		—		(13,069)		(13,069)
Balance, March 31, 2022	36,380,997	$	36	$	513,312	(2,457,849)	$	(47,861)	$	(269,411)	$	196,076
Exercise of common stock options	102,283		—		1,545	—		—		—		1,545
Vesting of RSUs and PSUs	111,056		1		—	—		—		—		1
Shares withheld for employee taxes upon vesting of RSUs and PSUs	(26,506)		—		(511)	—		—		—		(511)
Stock-based compensation	—		—		5,692	—		—		—		5,692
Net loss	—		—		—	—		—		(5,191)		(5,191)
Balance, June 30, 2022	36,567,830	$	37	$	520,038	(2,457,849)	$	(47,861)	$	(274,602)	$	197,612

The changes in shareholders’ equity for the three and six months ended 2021 were as follows:


				Additional							Total
	Common Stock			Paid- In		Treasury Stock			Accumulated		Shareholders’
	Shares		Amount	Capital		Shares		Amount	Deficit		Equity
Balance, December 31, 2020	34,612,054	$	35	$	519,143	—	$	—	$	(333,147)	$	186,031
Cumulative effect adjustment for adoption of ASU 2020-06	—		—		(44,777)	—		—		5,288		(39,489)
Exercise of common stock options	289,164		—		4,102	—		—		—		4,102
Issuance for employee stock purchase plan	24,630		—		358	—		—		—		358
Vesting of RSUs and PSUs	413,538		—		—	—		—		—		—
Shares withheld for employee taxes upon vesting of RSUs and PSUs	(135,562)		—		(3,508)	—		—		—		(3,508)
Stock-based compensation	—		—		6,879	—		—		—		6,879
Net income	—		—		—	—		—		15,662		15,662
Balance, March 31, 2021	35,203,824	$	35	$	482,197	—	$	—	$	(312,197)	$	170,035
Exercise of common stock options	273,127		1		4,092	—		—		—		4,093
Vesting of RSUs and PSUs	65,107		—		—	—		—		—		—
Shares withheld for employee taxes upon vesting of RSUs and PSUs	(18,141)		—		(421)	—		—		—		(421)
Stock-based compensation	—		—		6,516	—		—		—		6,516
Net income	—		—		—	—		—		72,843		72,843
Balance, June 30, 2021	35,523,917	$	36	$	492,384	—	$	—	$	(239,354)	$	253,066

Acquisitions - Acquisition Related Expenses (Details) - BioDelivery Sciences International, Inc $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2022 USD ($)	Jun. 30, 2022 USD ($)
Business Acquisition [Line Items]
Transaction costs	$ 161	$ 14,718
Employee-related expenses	1,389	8,008
BDSI directors and officers insurance		4,492
Other acquisition expenses	2,029	3,528
Total acquisition related expenses	3,579	30,746
Accrued Severance Costs	$ 848	$ 848

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021
Operating activities
Net (loss) income	$ (18,260)	$ 88,505
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
Amortization expense	56,424	33,590
Depreciation expense	1,371	864
Deferred income taxes	(9,410)	(62,649)
Stock-based compensation expense	11,827	13,395
Non-cash lease expense	429	15
Non-cash interest expense for amortization of debt discount and issuance costs	3,435	1,795
Changes in operating assets and liabilities:
Accounts receivable	(36,165)	(6,778)
Inventory	17,007	(4,498)
Prepaid expenses and other assets	245	(1,301)
Accounts payable	2,426	(2,472)
Accrued expenses	(7,659)	2,969
Accrued rebates, returns and discounts	(6,538)	(13,330)
Operating lease assets and liabilities	4
Net cash provided by operating activities	15,136	50,105
Investing activities
Purchases of property and equipment	(569)	(1,153)
Acquisition of BDSI (net of cash acquired)	(572,069)
Net cash used in investing activities	(572,638)	(1,153)
Financing activities
Proceeds from issuances of common stock from employee stock purchase plans	203	358
Proceeds from the exercise of stock options	4,806	8,274
Payments made for employee stock tax withholdings	(3,893)	(3,929)
Repayment of term notes	(25,000)	(25,000)
Proceeds from term note modification	517,682
Net cash provided by (used in) financing activities	493,798	(20,297)
Net (decrease) increase in cash, cash equivalents and restricted cash	(63,704)	28,655
Cash, cash equivalents and restricted cash at beginning of period	188,973	176,663
Cash, cash equivalents and restricted cash at end of period	125,269	205,318
Reconciliation of cash, cash equivalents and restricted cash to the Consolidated Balance Sheets:
Cash and cash equivalents	122,722	202,771
Restricted cash	2,547	2,547
Total cash, cash equivalents and restricted cash	125,269	205,318
Supplemental disclosure of cash flow information
Cash paid for interest	17,752	9,348
Cash paid for income taxes	6,776	876
Supplemental disclosure of non-cash activities
Acquisition of property and equipment in accounts payable and accrued expenses	$ 105	55
Inventory used in the construction and installation of property and equipment		$ 516

Accrued Expenses (Tables)

6 Months Ended

Jun. 30, 2022

Accrued Expenses

Schedule of components of accrued expenses


	June 30,		December 31,
	2022		2021
Accrued royalties	$	13,692	$	9,930
Acquired product right		9,000		—
Accrued product taxes and fees		3,421		2,570
Accrued bonuses		2,396		2,634
Accrued audit and legal		2,116		3,623
Accrued payroll and related benefits		1,969		807
Accrued sales and marketing		1,555		697
Accrued interest		1,415		1,415
Accrued incentive compensation		1,054		851
Accrued income taxes		—		622
Accrued restructuring expenses		—		3,222
Accrued other operating costs		3,086		2,843
Total accrued expenses	$	39,704	$	29,214

Goodwill and Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2022

Goodwill and Intangible Assets

Summary of changes in the carrying amount of goodwill


	Amount
Balance at December 31, 2021	$	—
Goodwill resulting from BDSI Acquisition		130,094
Balance at June 30, 2022	$	130,094

Schedule of gross carrying amount and accumulated amortization of the Intangible Asset


		As of June 30, 2022						As of December 31, 2021
	Amortization Period (Years)		Cost		Accumulated Amortization		Carrying Amount		Cost		Accumulated Amortization		Carrying Amount
Belbuca	4.8	$	360,000	$	(20,733)	$	339,267	$	—	$	—	$	—
Nucynta Products	8.0		521,170		(286,038)		235,132		521,170		(252,447)		268,723
Symproic	9.6		70,000		(2,003)		67,997		—		—		—
Elyxyb	14.2		5,000		(97)		4,903		—		—		—
Total intangibles		$	956,170	$	(308,871)	$	647,299	$	521,170	$	(252,447)	$	268,723

Summary of amortization expense


	Three Months Ended June 30,				Six Months Ended June 30,
		2022		2021		2022		2021
Belbuca	$	18,796	$	—	$	20,733	$	—
Nucynta Products		16,796		16,795		33,591		33,590
Symproic		1,821		—		2,003		—
Elyxyb		88		—		97		—
Total amortization expense	$	37,501	$	16,795	$	56,424	$	33,590

Schedule of future amortization expenses


Years ended December 31,	Belbuca		Nucynta Products		Symproic		Elyxyb		Total
2022	$	37,695	$	33,590	$	3,643	$	176	$	75,104
2023		75,393		67,181		7,285		352		150,211
2024		75,393		67,181		7,285		352		150,211
2025		75,393		67,180		7,285		352		150,210
2026		75,393		—		7,285		352		83,030
Thereafter		—		—		35,214		3,319		38,533
Remaining amortization expense	$	339,267	$	235,132	$	67,997	$	4,903	$	647,299

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Income Taxes
Benefit from income taxes	$ (1,455)	$ (61,852)	$ (4,228)	$ (62,040)
Effective tax rate	21.90%	(562.80%)	18.80%	(234.40%)

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Revenue from Contracts with Customers (Tables)

6 Months Ended

Jun. 30, 2022

Revenue from Contracts with Customers

Summary of product revenue provision and allowance


					Trade
	Rebates and		Product		Allowances and
	Incentives (1)		Returns (2)		Chargebacks (3)
Balance at December 31, 2021	$	142,379	$	54,617	$	13,226
Acquired from BDSI		38,074		18,187		7,575
Provision related to current period sales		233,089		16,675		59,211
Changes in estimate related to prior period sales		(481)		—		(37)
Credits/payments made		(244,356)		(11,465)		(52,939)
Balance at June 30, 2022	$	168,705	$	78,014	$	27,036


					Trade
	Rebates and		Product		Allowances and
	Incentives (1)		Returns (2)		Chargebacks (3)
Balance at December 31, 2020	$	132,775	$	23,779	$	19,055
Provision related to current period sales		179,571		7,491		42,059
Changes in estimate related to prior period sales		(441)		—		—
Credits/payments made		(178,508)		(21,443)		(33,764)
Balance at June 30, 2021	$	133,397	$	9,827	$	27,350

(1)

(2)

(3)

Schedule of disaggregation of revenue


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Belbuca	$	42,301	$	—	$	45,611	$	—
Xtampza ER		33,190		33,023		64,708		68,432
Nucynta IR		26,554		29,241		55,889		59,767
Nucynta ER		17,077		20,678		36,340		42,464
Symproic		3,860		—		4,160		—
Elyxyb		109		—		134		—
Other		458		—		458		—
Total product revenues, net	$	123,549	$	82,942	$	207,300	$	170,663

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Revenues
Product revenues, net	$ 123,549	$ 82,942	$ 207,300	$ 170,663
Revenue from Contract with Customer, Product and Service [Extensible List]	us-gaap:ProductMember	us-gaap:ProductMember	us-gaap:ProductMember	us-gaap:ProductMember
Cost of product revenues
Cost of product revenues (excluding intangible asset amortization)	$ 33,684	$ 15,908	$ 50,016	$ 31,236
Cost, Product and Service [Extensible List]	us-gaap:ProductMember	us-gaap:ProductMember	us-gaap:ProductMember	us-gaap:ProductMember
Intangible asset amortization	$ 37,501	$ 16,795	$ 56,424	$ 33,590
Total cost of products revenues	71,185	32,703	106,440	64,826
Gross profit	52,364	50,239	100,860	105,837
Operating expenses
Research and development	0	3,462	3,983	6,392
Selling, general and administrative	41,254	30,368	95,782	61,844
Total operating expenses	41,254	33,830	99,765	68,236
Income from operations	11,110	16,409	1,095	37,601
Interest expense	(17,761)	(5,421)	(23,592)	(11,142)
Interest income	5	3	9	6
(Loss) income before income taxes	(6,646)	10,991	(22,488)	26,465
Benefit from income taxes	(1,455)	(61,852)	(4,228)	(62,040)
Net (loss) income	$ (5,191)	$ 72,843	$ (18,260)	$ 88,505
(Loss) earnings per share - basic (in dollars per share)	$ (0.15)	$ 2.06	$ (0.54)	$ 2.52
Weighted-average shares - basic (in shares)	34,001,553	35,302,608	33,838,638	35,128,144
(Loss) earnings per share - diluted (in dollars per share)	$ (0.15)	$ 1.79	$ (0.54)	$ 2.20
Weighted-average shares - diluted (in shares)	34,001,553	41,286,853	33,838,638	41,251,749

Acquisitions - Fair Value of Purchase Consideration (Details) - BioDelivery Sciences International, Inc $ / shares in Units, $ in Thousands	Mar. 22, 2022 USD ($) $ / shares shares
Business Acquisition [Line Items]
Cash consideration for all outstanding shares of BDSI's common and preferred stock (103,265,298 shares acquired at $5.60 per share)	$ 578,118
Cash consideration paid to settle RSUs and in-the-money options	28,309
Cash paid to settle BDSI debt	63,004
Total purchase consideration	$ 669,431
Shares of common stock acquired \| shares	103,235,298
Share price (in dollars per share) \| $ / shares	$ 5.60

Convertible Senior Notes

6 Months Ended

Jun. 30, 2022

Convertible Senior Notes.

Convertible Senior Notes

12. Convertible Senior Notes

On February 13, 2020, the Company issued 2.625% convertible senior notes due in 2026 (the “convertible notes”) in the aggregate principal amount of $143,750, in a public offering registered under the Securities Act of 1933, as amended. The convertible notes were issued in connection with funding the Nucynta Acquisition, and the proceeds of the convertible notes were used to finance a portion of the purchase price payable pursuant to the Nucynta Purchase Agreement. Some of the Company’s existing investors participated in the convertible notes offering.

The Company may, at its option, settle the convertible notes in cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock.

The convertible notes are the Company’s senior unsecured obligations and bear interest at a rate of 2.625% per year payable semi-annually in arrears on February 15 and August 15 of each year, beginning on August 15, 2020. Before August 15, 2025, noteholders will have the right to convert their notes only upon the occurrence of certain events. From and after August 15, 2025, noteholders may convert their notes at any time at their election until the close of business on the scheduled trading day immediately before the maturity date. The Company will settle conversions by paying or delivering, as applicable, cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the Company’s election. The notes will mature on February 15, 2026, unless earlier repurchased, redeemed or converted. The initial conversion rate is 34.2618 shares of common stock per $1 principal amount of notes, which represents an initial conversion price of approximately $29.19 per share of common stock. The conversion rate and conversion price are subject to adjustment upon the occurrence of certain events.

Holders of the convertible notes may convert all or any portion of their convertible notes, in multiples of $1 principal amount, at their option only under the following circumstances:

(1)

during any calendar quarter commencing after the calendar quarter ending on March 31, 2020, if the last reported sale price per share of the Company’s common stock exceeds 130% of the conversion price for at least 20 trading days during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter;

(2)

during the five consecutive business days immediately after any 10 consecutive trading day period (such 10 consecutive trading day period, the “measurement period”) in which the “trading price” per $1 principal amount of the Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price per share of the Company’s common stock on such trading day and the conversion rate on such trading day;

(3)

upon the occurrence of certain corporate events or distributions on the Company’s common stock;

(4)

if the Company calls the convertible notes for redemption; or

(5)

at any time from, and including, August 15, 2025 until the close of business on the scheduled trading day immediately before the maturity date.

As of June 30, 2022, none of the above circumstances had occurred and as such, the convertible notes could not have been converted.

The Company may not redeem the convertible notes prior to February 15, 2023. On or after February 15, 2023, the Company may redeem the convertible notes, in whole and not in part, at a cash redemption price equal to the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, only if the last reported sale price per share of the Company’s common stock exceeds 130% of the conversion price on:

(1)

each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related redemption notice; and

(2)

the trading day immediately before the date the Company sends such notice.

Calling any convertible note for redemption will constitute a make-whole fundamental change with respect to that convertible note, in which case the conversion rate applicable to the conversion of that convertible note, if it is converted in connection with the redemption, will be increased in certain circumstances for a specified period of time.

The convertible notes have customary default provisions, including (i) a default in the payment when due (whether at maturity, upon redemption or repurchase upon fundamental change or otherwise) of the principal of, or the redemption price or fundamental change repurchase price for, any note; (ii) a default for 30 days in the payment when due of interest on any note; (iii) a default in the Company’s obligation to convert a note in accordance with the indenture; (iv) a default with respect to the Company’s obligations under the indenture related to consolidations, mergers and asset sales; (v) certain payment or other defaults by the Company or certain subsidiaries with respect to mortgages, agreements or other instruments for indebtedness for money borrowed of at least $20,000; and (vi) certain events of bankruptcy, insolvency and reorganization with respect to the Company or any of its significant subsidiaries.

As of June 30, 2022, the convertible notes outstanding consisted of the following:


Principal	$	143,750
Less: unamortized issuance costs		(3,335)
Net carrying amount	$	140,415

The Company determined the expected life of the convertible notes was equal to its six-year term. The effective interest rate on the convertible notes is 3.26%. As of June 30, 2022, the if-converted value did not exceed the remaining principal amount of the convertible notes.

The following table presents the total interest expense recognized related to the convertible notes during the three and six months ended June 30, 2022, and 2021:


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Contractual interest expense	$	943	$	943	$	1,887	$	1,887
Amortization of debt issuance costs		226		225		449		446
Total interest expense	$	1,169	$	1,168	$	2,336	$	2,333

As of June 30, 2022, the future minimum payments on the convertible notes were as follows:


Years ended December 31,	Future Minimum Payments
2022	$	1,886
2023		3,773
2024		3,773
2025		3,773
2026		145,638
Total minimum payments	$	158,843
Less: interest		(15,093)
Less: unamortized issuance costs		(3,335)
Convertible senior notes	$	140,415

Convertible Senior Notes - Outstanding (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Dec. 31, 2021
Debt
Net carrying amount	$ 140,415	$ 139,966
Convertible senior notes
Debt
Principal	143,750
Less: unamortized issuance costs	(3,335)
Net carrying amount	$ 140,415
Debt instrument term	6 years
Effective interest rate	3.26%

Goodwill and Intangible Assets

6 Months Ended

Jun. 30, 2022

Goodwill and Intangible Assets

Goodwill and Intangible Assets

9. Goodwill and Intangible Assets

The following tables summarizes the changes in the carrying amount of Goodwill:


	Amount
Balance at December 31, 2021	$	—
Goodwill resulting from BDSI Acquisition		130,094
Balance at June 30, 2022	$	130,094

The Company’s goodwill resulted from the BDSI Acquisition. During the three months ended June 30, 2022, goodwill increased by $1,418 due to measurement period adjustments associated with the BDSI Acquisition. Refer to Note 4, Acquisitions.

The following table sets forth the cost, accumulated amortization, and carrying amount of intangible assets as of June 30, 2022 and December 31, 2021:


		As of June 30, 2022						As of December 31, 2021
	Amortization Period (Years)		Cost		Accumulated Amortization		Carrying Amount		Cost		Accumulated Amortization		Carrying Amount
Belbuca	4.8	$	360,000	$	(20,733)	$	339,267	$	—	$	—	$	—
Nucynta Products	8.0		521,170		(286,038)		235,132		521,170		(252,447)		268,723
Symproic	9.6		70,000		(2,003)		67,997		—		—		—
Elyxyb	14.2		5,000		(97)		4,903		—		—		—
Total intangibles		$	956,170	$	(308,871)	$	647,299	$	521,170	$	(252,447)	$	268,723

The following table presents amortization expense recognized in cost of product revenues for the three and six months ended June 30, 2022 and 2021:


	Three Months Ended June 30,				Six Months Ended June 30,
		2022		2021		2022		2021
Belbuca	$	18,796	$	—	$	20,733	$	—
Nucynta Products		16,796		16,795		33,591		33,590
Symproic		1,821		—		2,003		—
Elyxyb		88		—		97		—
Total amortization expense	$	37,501	$	16,795	$	56,424	$	33,590

As of June 30, 2022, the remaining amortization expense expected to be recognized is as follows:


Years ended December 31,	Belbuca		Nucynta Products		Symproic		Elyxyb		Total
2022	$	37,695	$	33,590	$	3,643	$	176	$	75,104
2023		75,393		67,181		7,285		352		150,211
2024		75,393		67,181		7,285		352		150,211
2025		75,393		67,180		7,285		352		150,210
2026		75,393		—		7,285		352		83,030
Thereafter		—		—		35,214		3,319		38,533
Remaining amortization expense	$	339,267	$	235,132	$	67,997	$	4,903	$	647,299

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Current assets
Cash and cash equivalents	$ 122,722	$ 186,426
Accounts receivable, net	197,505	105,844
Inventory	77,769	17,394
Prepaid expenses and other current assets	11,778	5,879
Total current assets	409,774	315,543
Property and equipment, net	19,965	19,491
Operating lease assets	7,257	7,644
Intangible assets, net	647,299	268,723
Restricted cash	2,547	2,547
Deferred tax assets	28,571	78,042
Other noncurrent assets	67	87
Goodwill	130,094
Total assets	1,245,574	692,077
Current liabilities
Accounts payable	6,627	4,189
Accrued expenses	39,704	29,214
Accrued rebates, returns and discounts	246,719	196,996
Current portion of term notes payable	120,833	48,353
Current portion of operating lease liabilities	1,211	814
Total current liabilities	415,094	279,566
Term notes payable, net of current portion	484,853	61,666
Convertible senior notes	140,415	139,966
Operating lease liabilities, net of current portion	7,600	7,951
Total liabilities	1,047,962	489,149
Commitments and contingencies (see Note 15)
Shareholders' equity:
Preferred stock, $0.001 par value; authorized shares - 5,000,000
Common stock, $0.001 par value; authorized shares - 100,000,000; 36,567,830 issued and 34,109,981 outstanding shares at June 30, 2022 and 35,806,119 issued and 33,655,402 outstanding shares at December 31, 2021	37	36
Additional paid-in capital	520,038	502,095
Accumulated deficit	(274,602)	(256,342)
Treasury stock, at cost; 2,457,849 shares at June 30, 2022 and 2,150,717 shares at December 31, 2021	(47,861)	(42,861)
Total shareholders' equity	197,612	202,928
Total liabilities and shareholders' equity	$ 1,245,574	$ 692,077

Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021
Transfer of Assets From Level 1 to Level 2	$ 0	$ 0
Transfer of Assets From Level 2 to Level 1	0	0
Transfer of Liabilities From Level 1 to Level 2	0	0
Transfer of Liabilities From Level 2 to Level 1	0	0
Transfer of Assets Into Level 3	0	0
Transfer of Assets Out of Level 3	0	0
Transfer of Liabilities Into Level 3	0	0
Transfer of Liabilities Out of Level 3	0	$ 0
Convertible senior notes, fair value	119,492
Convertible senior notes, net carrying value	140,415		$ 139,966
Term notes outstanding principal balance	625,000
Money market funds
Cash equivalents	2,006		45,078
Level 1 \| Money market funds
Cash equivalents	$ 2,006		$ 45,078

Goodwill and Intangible Assets - Narratives (Details) $ in Thousands	3 Months Ended
	Jun. 30, 2022 USD ($)
BioDelivery Sciences International, Inc
Goodwill [Line Items]
Net offsetting decrease to Goodwill	$ 1,418

Acquisitions - Consolidated Statements of Operations (Details) - USD ($) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2022	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Business Acquisition [Line Items]
Total revenues	$ 123,549		$ 82,942	$ 207,300	$ 170,663
BioDelivery Sciences International, Inc
Business Acquisition [Line Items]
Total revenues		$ 50,362

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8906-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9031-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9038-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 4
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130543-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9054-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130545-203045

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 924
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-URI http://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

+ Details

Summary of Significant Accounting Policies - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Summary of Significant Accounting Policies
Research and development	$ 0	$ 3,462	$ 3,983	$ 6,392

Nature of Business

6 Months Ended

Jun. 30, 2022

Nature of Business

Nature of Business

1. Nature of Business

Collegium Pharmaceutical, Inc. (the “Company” or “Collegium”) was incorporated in Delaware in April 2002 and then reincorporated in Virginia in July 2014. The Company has its principal operations in Stoughton, Massachusetts. The Company’s mission is to build a leading, diversified specialty pharmaceutical company committed to improving the lives of people living with serious medical conditions. The Company’s portfolio includes the following commercial products: Xtampza ER, Nucynta ER and Nucynta IR (the “Nucynta Products”), Belbuca, Symproic, and Elyxyb.

Xtampza ER

The Company’s first product, Xtampza ER, is an abuse-deterrent, extended-release, oral formulation of oxycodone. In April 2016, the United States Food and Drug Administration (the “FDA”) approved the Company’s new drug application (“NDA”) for Xtampza ER for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment and for which alternative treatment options are inadequate. In June 2016, the Company announced the commercial launch of Xtampza ER.

Nucynta Products

In December 2017, the Company entered into a Commercialization Agreement (the “Nucynta Commercialization Agreement”) with Assertio Therapeutics, Inc. (formerly known as Depomed) (“Assertio”), pursuant to which the Company acquired the right to commercialize the Nucynta Products in the United States. In February 2020, the Company entered into an Asset Purchase Agreement with Assertio (the “Nucynta Purchase Agreement”), pursuant to which the Company acquired from Assertio certain assets related to the Nucynta Products (the “Nucynta Acquisition”), including the license from Grünenthal GmbH (“Grünenthal”). Upon closing, the Nucynta Commercialization Agreement was effectively terminated and the Company’s only remaining royalty obligation is to pay 14% of net sales of the Nucynta Products directly to Grünenthal. Nucynta ER is an extended-release formulation of tapentadol that is indicated for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment, including neuropathic pain associated with diabetic peripheral neuropathy in adults, and for which alternate treatment options are inadequate. Nucynta IR is an immediate-release formulation of tapentadol that is indicated for the management of acute pain severe enough to require an opioid analgesic and for which alternative treatments are inadequate in adults.

Belbuca, Symproic, and Elyxyb

On March 22, 2022 (the “Acquisition Date”), the Company acquired BioDelivery Sciences International, Inc. (“BDSI”), a specialty pharmaceutical company working to deliver innovative therapies for individuals living with serious and debilitating chronic conditions, pursuant to an Agreement and Plan of Merger (the “Merger Agreement”), dated as of February 14, 2022, by and among the Company, Bristol Acquisition Company Inc., a Delaware corporation and wholly owned subsidiary of the Company (“Purchaser”), and BDSI, a Delaware corporation (the “BDSI Acquisition”). Upon closing, the Company acquired the Belbuca, Symproic, and Elyxyb products. The Company began shipping and recognizing product sales related to Belbuca, Symproic, and Elyxyb after the closing. Belbuca is a buccal film that contains buprenorphine, a Schedule III opioid, that was approved by the FDA in October 2015 for use in patients with pain severe enough to require daily, around-the-clock, long-term opioid treatment for which alternative options are inadequate. Symproic was approved by the FDA in March 2017 for the treatment of Opioid-Induced Constipation (“OIC”) in adult patients with chronic non-cancer pain, including patients with chronic pain related to prior cancer or its treatment who do not require frequent (e.g., weekly) opioid dosage escalation. Elyxyb was approved by the FDA in May 2020 for the acute treatment of migraine with or without aura in adults.

The Company’s operations are subject to certain risks and uncertainties. The principal risks include inability to continue successfully commercializing products, changing market conditions for products and development of competing products, changing regulatory environment and reimbursement landscape, product-related litigation, manufacture of

adequate commercial inventory, inability to secure adequate supplies of active pharmaceutical ingredients, key personnel retention, protection of intellectual property, and patent infringement litigation.

The Company believes that its cash and cash equivalents at June 30, 2022, together with expected cash inflows from the commercialization of its products, will enable the Company to fund its operating expenses, debt service and capital expenditure requirements under its current business plan for at least one year from the date the consolidated financial statements were issued.

Term Notes Payable - Pharmakon (Details) - Pharmakon Term Notes - USD ($) $ in Thousands	Feb. 13, 2020	Jun. 30, 2022	Feb. 06, 2020
Debt
Aggregate principal amount			$ 200,000
Proceeds from term notes	$ 200,000
Principal repayments
2022		$ 50,000
2023		162,500
2024		183,333
2025		183,333
2026		45,834
Total before unamortized discount and issuance costs		625,000
Less: unamortized discount and issuance costs		(19,314)
Total term notes		$ 605,686

Convertible Senior Notes - Convertible Senior Notes (Details) $ / shares in Units, $ in Thousands		6 Months Ended
	Feb. 13, 2020 USD ($) D $ / shares	Jun. 30, 2022 USD ($) D	Dec. 31, 2021 USD ($)
Debt
Convertible senior notes \| $		$ 140,415	$ 139,966
Accumulated deficit \| $		(274,602)	(256,342)
Additional paid-in capital \| $		520,038	$ 502,095
Convertible senior notes
Debt
Interest rate (as a percent)	2.625%
Aggregate principal amount \| $	$ 143,750
Initial conversion rate	34.2618
Initial conversion price \| $ / shares	$ 29.19
Conversion, threshold percentage of stock price trigger	130.00%
Conversion, threshold trading days \| D	20
Conversion, threshold consecutive trading days \| D	30
Consecutive business days \| D	5
Measurement period \| D	10
Threshold percentage to product of sale price of common stock and conversion rate	98.00%
Default period	30 days
Threshold amount of money borrowed \| $	$ 20,000
Convertible senior notes \| $		$ 140,415
Convertible senior notes \| Conversion of convertible debt after the calendar quarter ending on March 31, 2020
Debt
Conversion, threshold percentage of stock price trigger		130.00%
Conversion, threshold trading days \| D		20
Conversion, threshold consecutive trading days \| D		30

Fair Value of Financial Instruments

6 Months Ended

Jun. 30, 2022

Fair Value of Financial Instruments

Fair Value of Financial Instruments

7. Fair Value of Financial Instruments

Disclosures of fair value information about financial instruments are required, whether or not recognized in the balance sheet, for financial instruments with respect to which it is practicable to estimate that value. Fair value measurements and

disclosures describe the fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value, as follows:


Level 1 inputs:	Quoted prices (unadjusted) in active markets for identical assets or liabilities
Level 2 inputs:	Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly
Level 3 inputs:	Unobservable inputs that reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability

Transfers are calculated on values as of the transfer date. There were no transfers between Levels 1, 2 and 3 during the six months ended June 30, 2022 and 2021.

The following tables present the Company’s financial instruments carried at fair value using the lowest level input applicable to each financial instrument at June 30, 2022 and December 31, 2021:


						Significant
				Quoted Prices		other		Significant
				in active		observable		unobservable
				markets		inputs		inputs
		Total		(Level 1)		(Level 2)		(Level 3)
June 30, 2022
Money market funds, included in cash equivalents	$	2,006	$	2,006	$	—	$	—

December 31, 2021
Money market funds, included in cash equivalents	$	45,078	$	45,078	$	—	$	—

The Company’s cash equivalents, which consist of money market funds, are measured at fair value on a recurring basis

using quoted market prices. Accordingly, these securities are categorized as Level 1.

The Company’s convertible senior notes fall into the Level 2 category within the fair value level hierarchy. The fair value was determined based on data points other than quoted prices that are observable, either directly or indirectly, such as broker quotes in a non-active market. As of June 30, 2022, the convertible senior notes had a fair value of

approximately $119,492 and a net carrying value of $140,415.

The Company’s term notes fall into the Level 2 category within the fair value level hierarchy and the fair value was

determined using quoted prices for similar liabilities in active markets, as well as inputs that are observable for the liability (other than quoted prices), such as interest rates that are observable at commonly quoted intervals. As of June 30, 2022, the outstanding principal balance of the term notes of $625,000 reasonably approximated the estimated fair value.

As of June 30, 2022, and December 31, 2021, the carrying amounts of the cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued expenses, and accrued rebates, returns and discounts reasonably approximated their estimated fair values.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Accrued Expenses

6 Months Ended

Jun. 30, 2022

Accrued Expenses

Accrued Expenses

10. Accrued Expenses

Accrued expenses as of June 30, 2022 and December 31, 2021 consisted of the following:


	June 30,		December 31,
	2022		2021
Accrued royalties	$	13,692	$	9,930
Acquired product right		9,000		—
Accrued product taxes and fees		3,421		2,570
Accrued bonuses		2,396		2,634
Accrued audit and legal		2,116		3,623
Accrued payroll and related benefits		1,969		807
Accrued sales and marketing		1,555		697
Accrued interest		1,415		1,415
Accrued incentive compensation		1,054		851
Accrued income taxes		—		622
Accrued restructuring expenses		—		3,222
Accrued other operating costs		3,086		2,843
Total accrued expenses	$	39,704	$	29,214

Term Notes Payable

6 Months Ended

Jun. 30, 2022

Term Notes Payable

Term Notes Payable

11. Term Notes Payable

Prior Pharmakon Term Notes

On February 6, 2020, in connection with the execution of the Nucynta Purchase Agreement, the Company, together with its subsidiary, Collegium Securities Corporation, entered into a loan agreement (the “2020 Loan Agreement”) with BioPharma Credit PLC, as collateral agent and lender, and BioPharma Credit Investments V (Master) LP, as lender (collectively “Pharmakon”). The 2020 Loan Agreement provided for a $200,000 secured term loan (the “2020 Term Notes”), the proceeds of which were used to finance a portion of the purchase price paid pursuant to the Nucynta Purchase Agreement. On February 13, 2020 (the “2020 Term Loan Closing Date”), the Company received the $200,000 proceeds from the 2020 Term Notes.

On March 22, 2022 the outstanding balance under the 2020 Loan Agreement was fully paid in connection with the closing of the BDSI Acquisition and establishment of the 2022 Term Loan, as defined below (the “2022 Loan Amendment”).

2022 Term Loan

On March 22, 2022, in connection with the closing of the BDSI Acquisition, the Company entered into an Amended and Restated Loan Agreement by and among the Company, the Purchaser, and Pharmakon (the “2022 Loan Agreement”).

The 2022 Loan Agreement provides for a $650,000 secured term loan (the “2022 Term Loan”), the proceeds of which were used to repay the Company’s existing term notes and fund a portion of the consideration to be paid to complete the BDSI Acquisition. The 2022 Loan Amendment was accounted for as a debt modification and transaction fees of $173 were expensed. In connection with the 2022 Loan Amendment, the Company paid loan commitment and other fees to the lender of $19,818, which together with preexisting debt issuance costs and note discounts of $2,049 will be amortized over the term of the loan using the effective interest rate.

The 2022 Term Loan will mature on the 48-month anniversary of the closing of the BDSI Acquisition and is guaranteed by the Company’s material domestic subsidiaries. The 2022 Term Loan is also secured by substantially all of the assets of the Company and its material domestic subsidiaries. The 2022 Term Loan bears interest at a rate based upon the London Interbank Offered Rate (“LIBOR”) (subject to a LIBOR floor of 1.20%), plus a margin of 7.5% per annum. As of June 30, 2022, the interest rate was 9.8%. The Company is required to repay the 2022 Term Loan by paying $100,000 in principal payments during the first year and the remaining $550,000 balance will amortize in equal quarterly installments over the remaining three years.

The 2022 Loan Agreement permits voluntary prepayment at any time, subject to a prepayment premium. The prepayment premium is equal to 2.00% of the principal amount being prepaid prior to the second-year anniversary of the closing date, or 1.00% of the principal amount being prepaid on or after the second-year anniversary of the closing date. The 2022 Loan Agreement also includes a make-whole premium in the event of a voluntary prepayment, a prepayment due to a change in control or acceleration following an Event of Default (as defined in the 2022 Loan Agreement) on or prior to the second-year anniversary of the closing date, in each case in an amount equal to foregone interest from the date of prepayment through the second-year anniversary of the closing date. A change of control also triggers a mandatory prepayment of the 2022 Term Loan.

The 2022 Loan Agreement contains certain covenants and obligations of the parties, including, without limitation, covenants that limit the Company’s ability to incur additional indebtedness or liens, make acquisitions or other investments or dispose of assets outside the ordinary course of business. Failure to comply with these covenants would constitute an event of default under the 2022 Loan Agreement, notwithstanding the Company’s ability to meet its debt service obligations. The 2022 Loan Agreement also includes various customary remedies for the lenders following an event of default, including the acceleration of repayment of outstanding amounts under the 2022 Loan Agreement and execution upon the collateral securing obligations under the 2022 Loan Agreement.

During the three and six months ended June 30, 2022, the Company recognized interest expense of $16,591 and $18,414, respectively, related to the 2022 Term Loan.

As of June 30, 2022, principal repayments under the 2022 Term Loan are as follows:


Years ended December 31,	Principal Payments
2022	$	50,000
2023		162,500
2024		183,333
2025		183,333
2026		45,834
Total before unamortized discount and issuance costs	$	625,000
Less: unamortized discount and issuance costs		(19,314)
Total term notes	$	605,686

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-URI http://asc.fasb.org/topic&trid=2208564

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (h)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (g)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1E
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495348-112611

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (i)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

+ Details

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2022	Dec. 31, 2021
CONDENSED CONSOLIDATED BALANCE SHEETS
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, authorized shares	5,000,000	5,000,000
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized shares	100,000,000	100,000,000
Common stock, issued shares	36,567,830	35,806,119
Common stock, outstanding shares	34,109,981	33,655,402
Treasury stock, shares	2,457,849	2,150,717

Revenue from Contracts with Customers - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Disaggregation of Revenue
Total revenues	$ 123,549	$ 82,942	$ 207,300	$ 170,663
Xtampza ER
Disaggregation of Revenue
Total revenues	33,190	33,023	64,708	68,432
Nucynta IR
Disaggregation of Revenue
Total revenues	26,554	29,241	55,889	59,767
Nucynta ER
Disaggregation of Revenue
Total revenues	17,077	$ 20,678	36,340	$ 42,464
Belbuca
Disaggregation of Revenue
Total revenues	42,301		45,611
Symproic
Disaggregation of Revenue
Total revenues	3,860		4,160
Elyxyb
Disaggregation of Revenue
Total revenues	109		134
Other
Disaggregation of Revenue
Total revenues	$ 458		$ 458

- Definition

+ References

+ Details

Convertible Senior Notes - Future Minimum Payments (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Principal repayments
Convertible senior notes	$ 140,415	$ 139,966
Convertible senior notes
Principal repayments
2022	1,886
2023	3,773
2024	3,773
2025	3,773
2026	145,638
Total minimum payments	158,843
Less: interest	(15,093)
Less: unamortized issuance costs	(3,335)
Convertible senior notes	$ 140,415

Convertible Senior Notes - Interest Expenses (Details) - Convertible senior notes - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Debt
Contractual interest expense	$ 943	$ 943	$ 1,887	$ 1,887
Amortization of debt issuance costs	226	225	449	446
Total interest expense	$ 1,169	$ 1,168	$ 2,336	$ 2,333

Income Taxes

6 Months Ended

Jun. 30, 2022

Income Taxes

Income Taxes

16. Income Taxes

The Company is subject to U.S. federal and state income taxes. The income tax provision for interim periods reflects the Company’s estimate of the annual effective tax rate expected to be applicable for the full fiscal year, adjusted for any discrete events which are recorded in the period in which they occur.

The following table presents information regarding the Company’s income tax (benefit) provision recognized for the three and six months ended:


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Benefit from income taxes	$	(1,455)	$	(61,852)	$	(4,228)	$	(62,040)
Effective tax rate		21.9%		(562.8%)		18.8%		(234.4%)

The benefit from income taxes in the three and six months ended June 30, 2022 reflects the tax benefit of the current year loss, which includes the impact of discrete nondeductible transaction costs and excess tax benefits, compared to the benefit in in the three and six months ended June 30, 2021, which reflected the impact of releasing a majority of the Company’s valuation allowance.

The Company provides a valuation allowance when it is more likely than not that deferred tax assets will not be realized. In determining the extent to which a valuation allowance for deferred tax assets is required, the Company evaluates all available evidence including projections of future taxable income, carry back opportunities, reversal of certain deferred tax liabilities, and other tax planning strategies. The Company has maintained a valuation allowance on the portion of its deferred tax assets that are not more likely than not to be realized due to tax limitation or other conditions as of June 30, 2022.

In connection with the BDSI Acquisition, the Company acquired net operating losses and is completing a study to determine the amount of net operating losses that are available and the limitations on use of these acquired operating losses as well as any valuation allowance required on these or other deferred tax assets.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 21
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 17
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 14
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 270
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-URI http://asc.fasb.org/topic&trid=2144680

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 30
-Section 50
-Paragraph 2
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

Stock-based Compensation - Summary of Stock-Based Compensation Included in Statement of Operations (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Stock-based compensation
Total stock-based compensation expense	$ 5,692	$ 6,516	$ 11,827	$ 13,395
Research and development
Stock-based compensation
Total stock-based compensation expense		1,248	1,591	2,465
Selling, general and administrative expenses
Stock-based compensation
Total stock-based compensation expense	$ 5,692	$ 5,268	$ 10,236	$ 10,930

Revenue from Contracts with Customers - Narrative (Details)	6 Months Ended	12 Months Ended
	Jun. 30, 2022	Dec. 31, 2021
Disaggregation of Revenue [Line Items]
Practical expedient incremental cost	true
Returns policy, threshold product return period	18 months
Returns policy, threshold product return period prior to expiration	6 months
Returns policy, threshold product return period after expiration	12 months
Maximum percentage of value of actual returned product to product returns claimed		20.00%
Xtampza and Nucynta Products
Disaggregation of Revenue [Line Items]
Returns policy, threshold product return period	18 months
Minimum
Disaggregation of Revenue [Line Items]
Term of payment received	30 days
Maximum
Disaggregation of Revenue [Line Items]
Term of payment received	90 days

Equity (Details) - USD ($) $ / shares in Units, $ in Thousands			3 Months Ended	6 Months Ended
	Jan. 07, 2022	Nov. 15, 2021	Jan. 07, 2022	Jun. 30, 2022	Dec. 31, 2021	Oct. 31, 2021	Aug. 31, 2021	Nov. 30, 2018	May 31, 2015
Equity
Share repurchase program authorized amount						$ 100,000	$ 100,000
Treasury stock repurchased				$ 47,861	$ 42,861
Third Amendment to the Nucynta Commercialization Agreement
Equity
Number of shares that can be purchased								1,041,667
Exercise price of warrant (in dollars per share)								$ 19.20
ASR
Equity
Share repurchase program authorized amount						$ 25,000
Price per share		$ 19.48
Percentage of upfront payment on a price per share		80.00%
Amount available for share repurchases under the program				$ 52,139
Shares repurchased during the period	307,132	1,026,694	1,333,826	2,457,849
Payments for repurchase of common stock		$ 25,000		$ 47,861
Shares repurchased, cost per share				$ 19.47
2014 Stock Incentive Plan
Equity
Shares of common stock authorized for issuance (in shares)									2,700,000
Increase in number of authorized shares on the first day of each fiscal year, as a percentage of outstanding common stock (as a percent)				4.00%
Shares of common stock remaining available for future grant (in shares)				1,871,810
Vesting period (in years)				4 years
Contractual life (in years)				10 years
Period following termination date vested options are exercisable (in months)				3 months