HERON THERAPEUTICS, INC. /DE/
For the period ended Sep 30, 2025. Filed Nov 4, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 4, 2025
HRTX$0.29+4.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-08.
0000950170-25-105475
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-04.
0001193125-25-263618
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 82 previous paragraphs and 93 current paragraphs.
49 unchanged; 26 reworded; 18 added; 6 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 3 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (18)
Current report
Recent Events
Current report
On August 8, 2025, we entered into the Second Amendment to the Working Capital Facility Agreement with Hercules Capital, Inc., as administrative agent, collateral agent and lender, which among other things, (i) provides for an aggregate principal amount of up to $150.0 million plus the accrued and unpaid paid-in-kind interest on the existing debt under the Initial Working Capital Facility Agreement, which was funded on August 12, 2025 (the “Closing Date”) and (ii) extends the maturity date of the Working Capital Facility Agreement to September 1, 2030. See Note 8 - Long-Term Debt and Convertible Notes to the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q. Concurrently on the Closing Date, we (i) issued and sold $35.0 million aggregate principal amount of 2031 Convertible Notes in a private placement pursuant to a note purchase agreement entered with a fund affiliated with Rubric Capital Management LP, for which we received a total of $31.9 million, net of issuance costs and original issuance discount, (ii) issued and sold 13,225,227 shares of common stock at a purchase price of $1.50 per share and 524,141 shares of Series A convertible preferred stock, which would automatically convert upon stockholder approval into 5,241,410 shares of common stock, at a conversion price of $1.50 per share (stated value of $15.00 per share) for aggregate gross proceeds of $27.7 million, (iii) exchanged all $150.0 million aggregate principal amount of the 2026 Convertible Notes outstanding for 16,666,666 shares of common stock for an aggregate principal amount of $25.0 million of the 2026 Convertible Notes and paid the remaining $125.0 million plus accrued and unpaid interest under the 2026 Convertible Notes in cash. At a special meeting of stockholders held on October 13, 2025, the Company’s stockholders approved, pursuant to Nasdaq Listing Rule 5635(d), the issuance of shares of common stock in connection with the conversion, at the option of the holders, of the 2031 Convertible Notes and the Series A convertible preferred stock.
Current report
We intend to wind down commercialization of SUSTOL over the next 12 months while we evaluate potential product updates. Subject to development progress, manufacturing readiness, and regulatory feedback, we may consider reintroducing SUSTOL as early as late 2027. During the wind down, we’ll continue to support customers and manage inventory responsibly, and we expect one time transition costs, which we’ll quantify as plans are finalized.
Current report
Contractual Obligations and Commitments
Current report
Purchase Obligations
Current report
Framework Agreement
Current report
On August 6, 2025, we entered into a Framework Agreement (the “Framework Agreement”) with Patheon Austria GmbH & Co KG (“Patheon”) and Thermo Fisher Scientific Inc. (solely for purposes as specified therein). Under the Framework Agreement, Patheon will manufacture and supply specific quantities of certain products, continue to perform certain ongoing stability studies related to such products and provide warehousing services, subject to the terms of a manufacturing and supply agreement previously entered into by us and Patheon, as amended by the amendments set forth in the Framework Agreement. We are required to purchase certain quantities of such products through December 31, 2026, but our monthly payment for such products may be reduced for unreleased products or non-conforming products if the products are not released by specified release dates. The Framework Agreement was effective on August 6, 2025 and will be in effect through and terminate automatically on December 31, 2026, other than with respect to any ongoing project addendums for stability studies entered into prior to December 31, 2026.
Current report
Lease Obligations
Current report
We have entered into two operating leases for laboratory and office space. Our laboratory and office space in San Diego, California, a portion of which has been subleased to a third party, has a lease term that expires on December 31, 2025. Our one five-year option to renew this lease on expiration applies only with respect to the portion of the premise that has not been subleased. The lease for office space in Cary, North Carolina is expected to commence no later than May 25, 2026 and expire 111 months from the lease commencement date, with the option to extend for one additional period of 84 months upon written notice. As the lease commencement date has not yet occurred, no right-of-use asset or lease liability has been recognized in the accompanying condensed consolidated financial statements. We provided the landlord with a letter of credit for $0.2 million, which is included within cash and cash equivalents in the condensed consolidate balance sheet.
Current report
Total oncology net product sales increased 1.7% or $0.4 million during the three months ended September 30, 2025, as compared to the comparable period in 2024.
Current report
The increase was primarily attributable to an increase in units sold, offset by an increase in discounts, rebates and administrative fees.
Current report
Total oncology net product sales decreased 3.4% or $2.8 million during the nine months ended September 30, 2025, as compared to the comparable period in 2024.
Current report
The increase in cost of product sales for the three months ended September 30, 2025, as compared to the same period ended September 30, 2024, is primarily attributable to an increase of $1.4 million of inventory reserves and write-offs recorded and an increase of $1.3 million in the cost of units sold, primarily due to supplier mix.
Current report
Research and development expense decreased by $1.0 million or 22.3%, during the three months ended September 30, 2025 compared to the same period in 2024. The decrease in costs is primarily attributable to a $0.8 million decrease in contract services due to timing and a $0.4 million decrease in write-offs of property and equipment.
Current report
Research and development expense decreased by $4.8 million or 35.7%, during the nine months ended September 30, 2025 compared to the same period in 2024. The decrease in costs is primarily attributable to a $2.0 million decrease in personnel and related expenses due to terminations, a decrease of $1.6 million in write-offs of property and equipment and other assets and a decrease of $0.9 million in contract services due to timing.
Current report
Sales and marketing expense increased by $0.8 million or 2.2%, during the nine months ended September 30, 2025 compared to the same period in 2024. The increase is primarily attributable to a $2.2 million increase in marketing costs, primarily related to
Current report
ZYNRELEF, partially offset by a decrease in personnel and related costs of $1.6 million as a result of a one-time stock compensation expense in 2024, which did not reoccur in 2025.
Current report
For the nine months ended September 30, 2025, other expense, net, was $14.7 million compared to $1.5 million for the same period in 2024. The increase in expense is related to the loss on debt extinguishment of $11.3 million, an increase in interest expense as a result of the debt refinancing completed in 2025, and a decrease in interest income as a result of a decreasing interest rates.
Removed paragraphs (6)
Previous report
Total oncology net product sales decreased 9.0% or $2.6 million during the three months ended June 30, 2025, as compared to the comparable period in 2024.
Previous report
Total oncology net product sales decreased 5.6% or $3.3 million during the six months ended June 30, 2025, as compared to the comparable period in 2024.
Previous report
Research and development expense decreased by $1.5 million or 33.8%, during the three months ended June 30, 2025 compared to the same period in 2024. The decrease in costs is primarily attributable to $1.2 million more of write-off of property and equipment in 2024 than in 2025, and a decrease in personnel and related expenses of $0.3 million due to terminations.
Previous report
Research and development expense decreased by $3.8 million or 42.3%, during the six months ended June 30, 2025 compared to the same period in 2024. The decrease in costs is primarily attributable to $1.2 million more of write-off of property and equipment in 2024 than in 2025, and a decrease in personnel and related expenses of $2.0 million due to terminations.
Previous report
Sales and marketing expense decreased by $1.2 million or 4.7%, during the six months ended June 30, 2025 compared to the same period in 2024. The decrease is primarily attributable to a $1.9 million decrease in personnel and related costs as a result of terminations and a one-time stock compensation expense in 2024, which did not reoccur in 2025. The decrease is offset by an increase in marketing costs of $0.6 million, primarily related to ZYNRELEF.
Previous report
For the six months ended June 30, 2025, other expense, net, was $1.3 million compared to $1.2 million for the same period in 2024.
Reworded paragraphs (26)
Previous wording
Results of Operations. This section provides an analysis of our results of operations presented in the accompanying condensed consolidated statements of operations and comprehensive loss by comparing the results for the three and six months ended June 30, 2025 and 2024.
Current wording
Results of Operations. This section provides an analysis of our results of operations presented in the accompanying condensed consolidated statements of operations and comprehensive loss by comparing the results for the three and nine months ended September 30, 2025 and 2024.
Previous wording
Liquidity and Capital Resources. This section provides a discussion of our financial condition and liquidity, an analysis of our cash flows for the six months ended June 30, 2025 and 2024, and a discussion of our outstanding commitments and contingencies that existed as of June 30, 2025.
Current wording
Liquidity and Capital Resources. This section provides a discussion of our financial condition and liquidity, an analysis of our cash flows for the nine months ended September 30, 2025 and 2024, and a discussion of our outstanding commitments and contingencies that existed as of September 30, 2025.
Previous wording
In March 2022, the Centers for Medicare and Medicaid Services ("CMS") approved a 3-year transitional pass-through status of ZYNRELEF, which became effective on April 1, 2022, for separate reimbursement outside of the surgical bundle payment in the Hospital Outpatient Department ("HOPD") setting of care. In addition, in December 2022, H.R. 2617, the omnibus spending bill was approved by Congress, which includes the Non-Opioids Prevent Addiction in the Nation (NOPAIN) Act which directs CMS to provide separate Medicare reimbursement for non-opioid treatments that are used to manage pain during surgeries conducted in hospital outpatient departments or in ambulatory surgical centers. To qualify, the non-opioid treatment must demonstrate the ability to replace, reduce, or avoid intraoperative or postoperative opioid use or the quantity of opioids prescribed in a clinical trial or through data published in a peer-reviewed journal. The hospital outpatient prospective payment system and ambulatory surgical center proposed rule for calendar year 2025 includes ZYNRELEF as a qualifying non-opioid requiring CMS to provide separate Medicare reimbursement in both the hospital outpatient department and ambulatory surgical center settings from January 1, 2025, through December 31, 2027.
Current wording
In March 2022, the Centers for Medicare and Medicaid Services ("CMS") approved a 3-year transitional pass-through status of ZYNRELEF, which became effective on April 1, 2022 and expired March 31, 2025, for separate reimbursement outside of the surgical bundle payment in the Hospital Outpatient Department ("HOPD") setting of care. In addition, in December 2022, H.R. 2617, the omnibus spending bill was approved by Congress, which includes the Non-Opioids Prevent Addiction in the Nation ("NOPAIN") Act which directs CMS to provide separate Medicare reimbursement for non-opioid treatments that are used to manage pain during surgeries conducted in hospital outpatient departments or in ambulatory surgical centers. To qualify, the non-opioid treatment must demonstrate the ability to replace, reduce, or avoid intraoperative or postoperative opioid use or the quantity of opioids prescribed in a clinical trial or through data published in a peer-reviewed journal. The hospital outpatient prospective payment system and ambulatory surgical center proposed rule for calendar year 2025 includes ZYNRELEF as a qualifying non-opioid requiring CMS to provide separate Medicare reimbursement in both the hospital outpatient department and ambulatory surgical center settings from April 1, 2025, through December 31, 2027.
Previous wording
There are no material changes to our material trends and developments disclosures included in our 2024 Annual Report during the three and six months ended June 30, 2025.
Current wording
There are no other material changes to our material trends and developments disclosures included in our 2024 Annual Report during the three and nine months ended September 30, 2025.
Previous wording
The discussion and analysis of our financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We evaluate our estimates on an ongoing basis, including those related to revenue recognition, investments, inventory and the related reserves, accrued clinical and manufacturing liabilities, income taxes and stock-based compensation. We base our estimates on historical experience and on assumptions that we believe to be reasonable under the circumstances, the results of which form the basis of making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ materially from these estimates under different assumptions or conditions.
Current wording
The discussion and analysis of our financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We evaluate our estimates on an ongoing basis, including those related to revenue recognition, investments, inventory and the related reserves, accrued clinical and manufacturing liabilities, income taxes, stock-based compensation and accounting for debt and equity transactions. We base our estimates on historical experience and on assumptions that we believe to be reasonable under the circumstances, the results of which form the basis of making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ materially from these estimates under different assumptions or conditions.
Previous wording
Our critical accounting estimates include: revenue recognition, investments, inventory and the related reserves, accrued clinical and manufacturing liabilities, income taxes, and stock-based compensation. There are no material changes to our critical accounting estimates disclosures included in our 2024 Annual Report, during the three and six months ended June 30, 2025.
Current wording
Our critical accounting estimates include: revenue recognition, investments, inventory and the related reserves, accrued clinical and manufacturing liabilities, income taxes, and stock-based compensation. There are no material changes to our critical accounting estimates disclosures included in our 2024 Annual Report, during the three and nine months ended September 30, 2025.
Previous wording
Results of Operations for the Three and Six Months Ended June 30, 2025 and 2024
Current wording
Results of Operations for the Three and Nine Months Ended September 30, 2025 and 2024
Previous wording
The following table summarizes the results of our operations for the three and six months ended June 30, 2025 and 2024 (in thousands):
Current wording
The following table summarizes the results of our operations for the three and nine months ended September 30, 2025 and 2024 (in thousands):
Previous wording
Total acute care net product sales increased 55.5% or $3.8 million during the three months ended June 30, 2025, as compared to the comparable period in 2024.
Current wording
Total acute care net product sales increased 67.2% or $4.9 million during the three months ended September 30, 2025, as compared to the comparable period in 2024.
Previous wording
Total acute care net product sales increased 70.5% or $8.7 million during the six months ended June 30, 2025, as compared to the comparable period in 2024.
Current wording
Total acute care net product sales increased 69.2% or $13.6 million during the nine months ended September 30, 2025, as compared to the comparable period in 2024.
Previous wording
These decreases were primarily attributable to market competition from branded products and generics. The competition and decreases in oncology net product sales are expected to continue for the foreseeable future.
Current wording
The decrease was primarily attributable to market competition from branded products and generics. The competition and decreases in oncology net product sales are expected to continue for the foreseeable future.
Previous wording
Cost of product sales decreased by 6.3% or $0.7 million during the three months ended June 30, 2025, as compared to the comparable period in 2024 and as a percentage of sales decreased 2.7% during the same period.
Current wording
Cost of product sales increased by 26.0% or $2.5 million during the three months ended September 30, 2025, as compared to the comparable period in 2024 and as a percentage of sales increased 2.4% during the same period.
Previous wording
Cost of product sales decreased by 3.4% or $0.6 million during the six months ended June 30, 2025, as compared to the comparable period in 2024 and as a percentage of sales decreased by 2.8% during the same period.
Current wording
Cost of product sales increased by 6.4% or $1.8 million during the nine months ended September 30, 2025, as compared to the comparable period in 2024 and as a percentage of sales decreased by 1.1% during the same period.
Previous wording
Gross profit for the three months ended June 30, 2025 was 73.5%, compared to 70.8% for the comparable period ended June 30, 2024.
Current wording
Gross profit for the three months ended September 30, 2025 was 68.8%, compared to 71.2% for the comparable period ended September 30, 2024.
Previous wording
Gross profit for the six months ended June 30, 2025 was 75.9%, compared to 73.2% for the comparable period ended June 30, 2024.
Current wording
Gross profit for the nine months ended September 30, 2025 was 73.6%, compared to 72.5% for the comparable period ended September 30, 2024.
Previous wording
The increase in gross profit with a corresponding decrease in cost of product sales for the three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024 is due to an increase in units sold, at a higher cost per unit due to supplier mix, offset by lower inventory reserves and write-offs.
Current wording
The increase in cost of product sales for the nine months ended September 30, 2025, as compared to the same period ended September 30, 2024, is primarily attributable to an increase in units sold combined with a lower cost per unit due to supplier mix.
Previous wording
The table of research and development expense below for the three and six months ended June 30, 2024 reflect reclassification of certain expenses amongst products to align with the Company's presentation for the three and six months ended June 30, 2025 as a result of further review of the nature of the expenses. This presentation results in no change to total operating expenses, loss from operations or net loss and no pro forma financial information is necessary.
Current wording
The table of research and development expense below for the three and nine months ended September 30, 2024 reflect reclassification of certain expenses amongst products to align with the Company's presentation for the three and nine months ended September 30, 2025 as a result of further review of the nature of the expenses. This presentation results in no change to total operating expenses, loss from operations or net loss and no pro forma financial information is necessary.
Previous wording
General and administrative expense increased by $0.6 million or 4.1%, during the three months ended June 30, 2025 compared to the same period in 2024. The increase in costs is primarily attributable to $0.3 million increase in personnel and related expenses due to net new hires and a $0.4 million increase in contract services due to timing. These increases were offset by a decrease of $0.2 million in legal expenses due to timing of litigation.
Current wording
General and administrative expense increased by $1.6 million or 13.0%, during the three months ended September 30, 2025 compared to the same period in 2024. The increase in costs is primarily attributable to $0.8 million increase in personnel and related expenses due to net new hires and a $0.5 million increase in contract services due to timing.
Previous wording
General and administrative expense decreased by $1.7 million or 5.9%, during the six months ended June 30, 2025 compared to the same period in 2024. The decrease in costs is primarily attributable to a $1.6 million decrease in personnel and related costs due to terminations.
Current wording
General and administrative expense decreased by $0.1 million or 0.2%, during the nine months ended September 30, 2025 compared to the same period in 2024. The decrease in costs is primarily attributable to a $0.7 million decrease in legal expense due to timing of litigation, a $0.6 million decrease in personnel and related costs due to terminations. These decreases were partially offset by an increase of $1.1 million in contract services due to timing.
Previous wording
Sales and marketing expense decreased by $2.0 million or 15.0%, during the three months ended June 30, 2025 compared to the same period in 2024. The decrease is primarily attributable to a decrease in personnel and related expenses of $2.1 million as a result of terminations and a one-time stock compensation expense in 2024, which did not reoccur in 2025. The decrease is offset by an increase in marketing costs of $0.2 million, primarily related to ZYNRELEF.
Current wording
Sales and marketing expense increased by $2.0 million or 18.0%, during the three months ended September 30, 2025 compared to the same period in 2024. The increase is primarily attributable to an increase in marketing costs of $1.5 million, primarily related to ZYNRELEF and a $0.3 million increase in personnel and related expenses due to net new hires.
Previous wording
For the three months ended June 30, 2025, other expense, net was $0.7 million, compared to $2.8 million, for the same period in 2024. The decrease in expense is related to a one-time settlement in 2024 which did not reoccur in 2025.
Current wording
For the three months ended September 30, 2025, other expense, net was $13.4 million, compared to $0.4 million, for the same period in 2024. The increase in expense is related to the loss on debt extinguishment of $11.3 million and an increase in interest expense as a result of the debt refinancing completed in 2025.
Previous wording
As of June 30, 2025, we had cash, cash equivalents and short-term investments of $40.6 million. Our net loss for the three months ended June 30, 2025 was $2.4 million, or $0.02 per share, compared to a net loss of $9.2 million, or $0.06 per share, for the same period in 2024. Our net income for the six months ended June 30, 2025 was $0.3 million, or nil per share, compared to a net loss of $12.4 million, or $0.08 per share for the same period in 2024. We have incurred significant operating losses and negative cash flows from operations and had an accumulated deficit of $1.9 billion as of June 30, 2025. From our inception through June 30, 2025, we have financed our growth and operations, including technology and product research and development, primarily through the issuance of common stock, convertible notes and warrants, product sales and debt financings.
Current wording
As of September 30, 2025, we had cash, cash equivalents and short-term investments of $55.5 million. Our net loss for the three months ended September 30, 2025 was $17.5 million, or $0.10 per share, compared to a net loss of $4.8 million, or $0.03 per share, for the same period in 2024. Our net loss for the nine months ended September 30, 2025 was $17.2 million, or $0.11 per share, compared to a net loss of $17.2 million, or $0.11 per share, for the same period in 2024. We have incurred significant operating losses and negative cash flows from operations and had an accumulated deficit of $1.9 billion as of September 30, 2025. From our inception through September 30, 2025, we have financed our growth and operations, including technology and product research and development, primarily through the issuance of common stock, convertible notes and warrants, product sales and debt financings. Based on our current operating plan and projections, management believes that the Company's cash, cash equivalents and short-term investments will be sufficient to meet the Company's anticipated cash requirements for a period of at least one year from the issuance of the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q. We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect, which would have a material impact on our operations.
Previous wording
Our net cash used in operating activities for the six months ended June 30, 2025 and June 30, 2024 was $19.7 million and $14.1 million, respectively. The increase in net cash used in operating activities of $5.6 million or 39.8%, was primarily attributable to payments for inventory, offset by a decrease in net loss for the six months ended June 30, 2025 compared to the same period in 2024.
Current wording
Our net cash used in operating activities for the nine months ended September 30, 2025 and September 30, 2024 was $18.4 million and $10.7 million, respectively. The increase in net cash used in operating activities of $7.7 million or 71.2%, was primarily attributable to payments for inventory, accounts payable, and accrued clinical and manufacturing liabilities, partially offset by a decrease in net loss for the nine months ended September 30, 2025 compared to the same period in 2024 and the loss on debt extinguishment recognized in the nine months ended September 30, 2025.
Previous wording
Our net cash provided by investing activities for the six months ended June 30, 2025, and June 30, 2024 was $9.6 million, and $3.3 million, respectively. The increase in net cash provided by investing activities of $6.3 million or approximately two-fold, was primarily attributable to net maturities of short-term investments of $9.9 million for the six months ended June 30, 2025 compared to $4.0 million for the three months ended June 30, 2024.
Current wording
Our net cash provided by investing activities for the nine months ended September 30, 2025, and September 30, 2024 was $21.5 million, and $7.3 million, respectively. The increase in net cash provided by investing activities of $14.2 million or approximately two-fold, was primarily attributable to net maturities of short-term investments of $21.7 million for the nine months ended September 30, 2025 compared to $8.4 million for the nine months ended September 30, 2024.
Previous wording
Our net cash provided by financing activities for the six months ended June 30, 2025, and June 30, 2024 was $0.8 million, and $0.5 million, respectively.
Current wording
Our net cash provided by financing activities for the nine months ended September 30, 2025, and September 30, 2024 was $14.2 million, and $0.5 million, respectively. The increase in net cash provided by financing activities of $13.7 million is primarily attributable to $13.4 million in cash provided through the debt and equity transactions which closed in the nine months ended September 30, 2025.
Previous wording
There are no material changes to our material cash requirements disclosures included in our 2024 Annual Report during the three and six months ended June 30, 2025.
Current wording
There are no material changes to our material cash requirements disclosures included in our 2024 Annual Report during the three and nine months ended September 30, 2025.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
As of June 30, 2025, we had cash, cash equivalents and short-term investments of $40.6 million. Subsequent to entering into the closing of the Refinancing Transactions, and based on our current operating plan and projections, management believes that our cash, cash equivalents, and short-term investments, will be sufficient to meet our anticipated cash requirements for a period of at least one year from the date that the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q are issued.