ANI PHARMACEUTICALS INC

We currently lease office space in Princeton, New Jersey, our commercial headquarters, pursuant to a lease agreement entered into in August 2025, which includes certain employees in our corporate, legal, human resources, finance and accounting, IT, business functions, and Rare Disease operations. The current lease will expire in November 2035.

We also lease spaces for warehouse and packaging activities in East Windsor, New Jersey, and for research and development activities in Chennai, India. During 2023, we expanded our East Windsor, New Jersey facility to accommodate additional laboratory, product development, and employee office space.

In connection with the acquisition of Alimera, we also acquired office space in Alpharetta, Georgia. Our lease for this facility expires in December 2032 with an early termination option in December 2029 and an option to extend five years beyond December 2032. The Company has subleased the entire space to a subtenant which expires in December 2032.

Internationally, we lease office space in Dublin, Ireland, Berlin, Germany, and Hook, UK. Our leases for the two facilities in Ireland expire in 2026 and 2027. Our lease for the office space in Berlin, Germany expires in 2027. We entered into the Hook, UK lease in December 2024 and it expires in December 2034. Additionally, we have an agreement for the usage of approximately 400 square feet of office space in Lisbon, Portugal, which can be terminated with 90 days’ notice.

We consider our leased and owned properties suitable and adequate for our current and foreseeable needs.

• We expect to spend significant resources on research and development efforts, and such efforts may not result in marketable products. Failure to successfully introduce products into the market could have a material adverse effect on our business, financial position, and operating results.
• We produce the majority of our products in three manufacturing facilities. Production at any or all of these facilities could be interrupted, which could cause us to fail to deliver sufficient product to customers on a timely basis and have a material adverse effect on our business, financial position, and operating results.
• We rely on third parties to assist with our clinical trials. If these third parties do not perform as required or expected, or if they are not in compliance with FDA rules and regulations, our clinical trials may be extended, delayed or terminated, or may need to be repeated, and we may not be able to obtain regulatory approval for or commercialize the products being tested in such trials. Further, we may be required to audit or redo previously completed trials or recall already-approved commercial products.
• Clinical trials for our products may not generate the outcomes we expect, may take longer or be more costly to complete than we anticipate.
• Any significant adverse events or undesirable side effects caused by our products may impact regulatory approval or market acceptance, or result in significant negative consequences.
• Climate change concerns could disrupt our businesses, adversely affect client activity levels, adversely affect the creditworthiness of our counterparties, and damage our reputation.
• Our current and potential future use of artificial intelligence and machine learning may not be successful and introduces emerging risks and challenges to our business.
• Risks Related to Our Intellectual Property
• We may be adversely affected by the expiration of patents that protect key aspects of ILUVIEN and YUTIQ in the near- to medium-term.
• Inability to protect our intellectual property in the U.S. and foreign countries could negatively affect sales of our branded products.
• If we fail to comply with our obligations in the agreements under which we license development or commercialization rights to products or technology from third parties, we could lose license rights that are material to our business.
• We do not control the commercialization of ILUVIEN in China, East Asia and the Western Pacific, and receipt of the value we currently anticipate will depend on, among other factors, Ocumension’s ability to further commercialize ILUVIEN in that region.
• If we or our licensors are unable to obtain and maintain protection for the intellectual property incorporated into our products, the value of our technology and products will be adversely affected.
• Litigation or third-party claims of intellectual property infringement would require us to divert resources and may prevent or delay our commercialization of our current products or the development or regulatory approval of other product candidates.
• If our efforts to protect the proprietary nature of the intellectual property related to our products are inadequate, we may not be able to compete effectively in our markets.
• We may become involved in lawsuits to protect or enforce our patents or the patents of our licensors, which could be expensive, time-consuming and unsuccessful.
• If we are unable to protect the confidentiality of our proprietary information and know-how, the value of our technology and products could be adversely affected.
• We rely significantly on information technology and any failure, inadequacy, interruption, or security lapse of that technology, including any cybersecurity incidents, could harm our ability to operate the business effectively.
• We are currently involved in and may from time to time become involved in legal proceedings, some of which may result in substantial losses, government enforcement actions, damage to our business and reputation, and strain on our internal resources.
• We are susceptible to product liability claims that may not be covered by insurance, which, if successful, could require us to pay substantial sums.
• As a result of the consummation of the Merger, we need to meet certain additional requirements for our international operations, including adequate levels of reimbursement and various regulatory approvals, and our inability to meet these requirements could adversely affect our results of operations.
• As a result of the consummation of the Merger, our reliance on third parties to manufacture and test certain of our products will increase, and if any of these third parties is unable to satisfy our demand, our business, operating results and financial condition could suffer.
• Future acquisitions and investments could disrupt our business and harm our financial position and operating results.
• Risks Related to Our Industry
• Public health outbreaks, epidemics, or pandemics have adversely affected and may in the future adversely affect our business.
• The continuing trend toward consolidation of customer groups could result in declines in the sales volume and prices of our products, and increased fees charged by customers, each of which could have a material adverse effect on our business, financial position, and operating results.
• Our reporting and payment obligations under the Medicaid rebate program and other governmental purchasing and rebate programs are complex and may involve subjective decisions. Any determination that we have failed to comply with those obligations could subject us to penalties and sanctions, which could adversely affect our business, financial position, and operating results.
• Four products, which together comprised less than 10% of our total revenue in 2025, are marketed without approved NDAs or ANDAs and we cannot be certain that the FDA will not require us to either seek approval for these products or withdraw them from the market. In either case, our business, financial position, and operating results could be materially adversely affected.
• Imported API are subject to inspection by the FDA and the FDA can refuse to permit the importation of API for use in products that are marketed without approved NDAs or ANDAs. We are dependent on imported API to make certain of our products. If the FDA detained or refused to allow the importation of such API of if tariffs or other governmental action make the import of such API costly, our revenues from certain of our products would be reduced or eliminated and our business, financial position, and operating results could be materially adversely affected.
• The FDA does not provide guidance on safety labeling for products that are marketed without approved NDAs or ANDAs. As a result, we are dependent on our internal post-approval drug safety surveillance program to identify necessary safety-related changes to the labels for EEMT, Opium Tincture, and Thyroid Tablets, and Hyoscyamine.
• We are entirely dependent on periodic approval by the DEA for the supply of the API needed to manufacture our schedule II controlled substances. An inability to obtain such approvals would reduce or eliminate our revenues for our controlled substances, and could have a material adverse effect on our business, financial position, and operating results. In addition, we are subject to strict regulation by the DEA and are subject to sanctions if we are unable to comply with related regulatory requirements.
• Our products are subject to regulatory and quality standards and guidelines set forth by FDA and other governmental agencies. Changes or developments in such standards and guidelines may affect the ability of our products to meet such standards, including with respect to already approved products. If our products are not able to meet these standards, we may be required to discontinue marketing and/or recall such products from the market.
• Inadequate funding for the FDA, DEA, the SEC and other government agencies, including from government shutdowns, or other disruptions to these agencies’ operations, could hinder their ability to hire and retain key leadership and other personnel, prevent new products and services from being developed or commercialized in a timely manner or otherwise prevent those agencies from performing normal business functions on which the operation of our business may rely, which could negatively impact our business.
• We may become subject to federal and state false claims litigation brought by private individuals and the government.
• The use of legal, regulatory, and legislative strategies by competitors, both branded and generic, including “authorized generics,” citizen’s petitions, and legislative proposals, may increase the costs to develop and market our generic products, could delay or prevent new product introductions, and could significantly reduce our profit potential. These factors could have a material adverse effect on our business, financial position, and operating results.
• The successful commercialization of our products depends on adequate coverage and reimbursement from third party payors.
• We are subject to federal, state, and local laws and regulations, and complying with these may cause us to incur significant additional costs.
• Our operations in international markets subject us to additional regulatory oversight both in the international market and in the U.S., as well as, social, and political uncertainties, which could cause a material adverse effect on our business, financial position, and operating results.
• U.S. healthcare reform initiatives may materially and adversely affect our business and operating results.
• Inflation could have a material adverse effect on our business, financial position, and operating results.
• Risks Related to Accounting, Tax, and SEC Rules and Regulations
• We have increased exposure to tax liabilities, including foreign tax liabilities.
• The international nature of our operations, including those resulting from our acquisition of Alimera and its international operations, will subject us to political and economic risks and increase our exposure to potential liability under anti-corruption, trade protection, tax, and other laws and regulations.
• The international nature of our operations (including the acquisition of Alimera) will subject us to political and economic risks that could adversely affect our business, results of operations, or financial condition.
• Significant political, trade, regulatory developments, and other circumstances beyond our control, could have a material adverse effect on our financial condition or results of operations.
• Failure to comply with applicable transfer pricing and similar regulations could have a material adverse effect on our financial position and operating results.
• Changes in estimates regarding the fair value of goodwill or intangible assets may result in an adverse impact to our business, financial position, and operating results.
• Our management is required to devote substantial time to comply with public company regulations. If we are unable to comply with these regulations, investors could lose confidence in us, which could have a material adverse effect on our stock price, business, financial position, and operating results.
• Our policies regarding returns, allowances and chargebacks, as well as marketing programs adopted by wholesalers, may reduce revenues in future fiscal periods.
• Risks Related to our Debt
• Our indebtedness and liabilities could limit the cash flow available for our operations and expose us to risks that could adversely affect our business, financial condition and results of operation.
• Our 2024 Credit Agreement contains restrictive and financial covenants and if we are not in compliance with these covenants, our outstanding indebtedness under this facility could be accelerated and the lenders could terminate their commitments under the facility.
• Our variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase and our net income and cash flows to correspondingly decrease.
• Shares of our common stock issuable upon conversion of the Notes may dilute the ownership interest of our common stockholders or may adversely affect the market price of our common stock.
• We may be unable to raise the funds necessary to repurchase the Notes for cash following a fundamental change or to pay the cash amounts due upon maturity or conversion of the Notes, and our other indebtedness limits our ability to repurchase the Notes or to pay the cash amounts due upon their maturity or conversion.
• Provisions in the indenture governing the Notes could delay or prevent an otherwise beneficial takeover of us.
• The conversion of the Notes could impair our financial position and liquidity.
• The accounting method for the Notes could adversely affect our reported financial condition and results.
• The capped call transactions may affect the value of the Notes and our common stock.
• We are subject to counterparty risk with respect to the capped call transactions, and the capped call may not operate as planned.
• Risks Related to Our Common Stock
• Raising additional funds by issuing additional equity securities may cause dilution to our current stockholders. Raising additional funds by entering into additional credit or other borrowing facilities or issuing debt may subject us to covenants and other requirements that may restrict our operations.
• Provisions in our charter documents and Delaware law could discourage or prevent a takeover, even if such a transaction would be beneficial to our stockholders.
• General Risk Factors
• We use a variety of estimates, judgments, and assumptions in preparing our consolidated financial statements. Estimates, judgments, and assumptions are inherently subject to change, and any such changes could result in corresponding changes to the amounts of assets, liabilities, revenues, expenses, and income. Any such changes could have a material adverse effect on our business, financial position, and operating results.
• Our success is largely dependent upon certain key employees, including members of our senior management team, the loss of whom could adversely affect our operations. Competition for talent is intense, especially in northern Minnesota, where the population is small. If we cannot attract and retain qualified personnel, the growth and success of our business could be adversely affected.
• The market price of our common stock has been volatile, and an investment in our common stock could decline in value.