Amphastar Pharmaceuticals, Inc.

Previous wording

We are a bio-pharmaceutical company focusing primarily on developing, manufacturing, marketing, and selling technically challenging generic and proprietary injectable, inhalation, and intranasal products, as well as insulin API products. We currently manufacture and sell over 25 products.

Current wording

We are a biopharmaceutical company focusing primarily on developing, manufacturing, marketing and selling technically challenging generic and proprietary injectable, inhalation, and intranasal products, as well as insulin API products. We currently manufacture and sell over 25 products.

Previous wording

Recent worldwide events and macroeconomic factors, such as international trade relations, tariffs, new legislation and regulations, changes in administration, taxation or monetary policy changes, public sector budgetary cycles and funding authorization in the United States, political and civil unrest, global conflicts such as the Russia-Ukraine and Middle East conflicts, supply chain disruptions, heightened inflationary pressures, tariffs and fluctuating interest rates, as well as rising healthcare costs among other factors, also increase volatility in the global economy and continue to pose challenges to our business. For example, there is significant uncertainty relating to tariffs. While all of our finished products and four of our APIs are manufactured in the United States, we import APIs, starting materials for APIs, and components from various countries.

Current wording

Recent worldwide events and macroeconomic factors, such as international trade relations, tariffs, new legislation and regulations, changes in administration, taxation or monetary policy changes, public sector budgetary cycles and funding authorization in the United States, political and civil unrest, global conflicts, supply chain disruptions, heightened inflationary pressures, tariffs and fluctuating interest rates, as well as rising healthcare costs among other factors, also increase volatility in the global economy and continue to pose challenges to our business. For example, there is significant uncertainty relating to tariffs. While all of our finished products and four of our APIs are manufactured in the United States, we import APIs, starting materials for APIs, and components from various countries.

Previous wording

We anticipate that sales of glucagon will continue to fluctuate in the future due to competitive dynamics. We also anticipate that sales of epinephrine and other products will continue to fluctuate depending on the ability of our competitors to supply market demands.

Current wording

We anticipate that sales of glucagon will continue to decline in the future due to competitive dynamics. We also anticipate that sales of epinephrine and other products will continue to fluctuate depending on the ability of our competitors to supply market demands.

Previous wording

The increase in selling, distribution and marketing expenses was primarily due to expenses related to the expansion of our sales and marketing efforts related to BAQSIMI®, including expenses related to our co-promotion contract with MannKind, and sales efforts related to Primatene MIST®.

Current wording

The increase in selling, distribution and marketing expenses was primarily related to the expansion of our sales and marketing efforts related to BAQSIMI®, including expenses related to our co-promotion contract with MannKind, and sales efforts related to Primatene MIST®. The increase in general and administrative expense was primarily due to an increase in salary and personnel-related expenses, which was partially offset by a decrease in accounting and consulting service fees.

Previous wording

Research and development expenses increased primarily due to an increase in salary and personnel-related expenses, as well as an increase in clinical trial expenses, and an increase in FDA filing fees.

Current wording

Research and development expenses increased primarily due to an increase in material and supply expenses for our inhalation pipeline products. Additionally, we had an increase in depreciation expense, as well as an increase in clinical trial expense.

Previous wording

The change in non-operating income (expenses), net is primarily a result of:

Current wording

The change in non-operating expenses, net is primarily a result of:

Previous wording

Our effective tax rate for the three months ended March 31, 2025 increased in comparison to the three months ended March 31, 2024, primarily due to timing of discrete tax items. For more information regarding our income taxes, see “Part I – Item 1. Financial Statements – Notes to Condensed Consolidated Financial Statements – Note 14. Income Taxes.”

Current wording

Our effective tax rate for the three months ended June 30, 2025 decreased in comparison to the three months ended June 30, 2024, primarily due to differences in pre-tax income positions, partially offset by timing of discrete tax items. For more information regarding our income taxes, see “Part I – Item 1. Financial Statements – Notes to Condensed Consolidated Financial Statements – Note 14. Income Taxes.”

Previous wording

BAQSIMI® sales increased primarily due to an increase in unit volume, as we assumed full distribution responsibilities globally at the beginning of 2025. Primatene MIST® sales increased primarily due to an increase in unit volumes. The decrease in sales of glucagon was primarily due to a decrease in unit volumes, as a result of competition and a move to ready to use glucagon products such as BAQSIMI®. The decrease in sales of epinephrine was due to both a decrease in unit volumes, as well as a lower average selling price for our multi-dose vial product, as a result of increased competition. The decrease in other products was primarily due to a decrease in sales of enoxaparin, dextrose and naloxone, due to increased competition. This decrease was partially offset by increased unit volumes of albuterol, which we launched in August 2024 and higher unit sales of phytonadione.

Current wording

BAQSIMI® sales increased primarily due to an increase in unit volume, as we assumed full distribution responsibilities globally at the beginning of 2025. Primatene MIST® sales increased primarily due to an increase in unit volumes. Lidocaine sales increased due to both an increase in unit volumes contributing sales of $1.9 million, as well as an increase in average selling price, which contributed sales of $1.2 million. The decrease in sales of epinephrine was primarily due to a decrease in unit volume, as a result of other suppliers returning to their historical distribution level for the epinephrine pre-filled syringe, as well as increased competition for our multi-dose epinephrine vial product. The decrease in sales of glucagon was due to a decrease in unit volumes, impacting sales of $7.6 million, as well as a decrease in average selling price, which impact sales of $6.9 million, as a result of competition and a move to ready to use glucagon products such as BAQSIMI®. The decrease in other products was primarily due to a decrease in sales of enoxaparin, dextrose and naloxone, due to increased competition. This decrease was partially offset by sales of albuterol, which we launched in August 2024.

Previous wording

As we completed the assumption of distribution responsibilities globally for BAQSIMI® at the beginning of 2025, all BAQSIMI® related revenues in the current period are recognized in Product revenues, net. Other revenues in the previous period include the portion of BAQSIMI® sales made by Lilly on our behalf under the Transition Service Agreement, or TSA, which amounted to $14.2 million during the three months ended March 31, 2024. based on total BAQSIMI® sales of $24.6 million as reported to us by Lilly, which was recognized on a net basis, similar to a royalty arrangement.

Current wording

As we completed the assumption of distribution responsibilities globally for BAQSIMI® at the beginning of 2025, all BAQSIMI® related revenues in the current period are recognized in Product revenues, net. Other revenues in the previous period include the portion of BAQSIMI® sales made by Lilly on our behalf under the TSA, which amounted to

Previous wording

In 2024, under the TSA, the portion of revenues relating to BAQSIMI® sales made by Lilly on our behalf were reported on a net basis, similar to a royalty arrangement with no amount reported as cost of revenues resulting in increased gross margins for that period. Gross margins were also impacted by lower pricing for epinephrine multi-dose vials and an increase in labor costs.

Current wording

In 2024, under the TSA, the portion of revenues relating to BAQSIMI® sales made by Lilly on our behalf were reported on a net basis, similar to a royalty arrangement with no amount reported as cost of revenues resulting in increased gross margins for that period. Gross margins were also impacted by lower pricing for glucagon and epinephrine multi-dose vials, both of which are higher-margin products, as well as an increase in labor costs. Additionally, cost control efforts across the business partially offset the impact of pricing declines.

Previous wording

The decrease in gross margins was partially offset by the increase in sales of Primatene MIST® and phytonadione, which are higher-margin products.

Current wording

The decrease in gross margins was partially offset by the increase in sales of Primatene MIST®, which is a higher-margin product.

Previous wording

We need capital resources to maintain and expand our business. We expect our cash requirements to increase significantly in the foreseeable future as we make milestone payments for our BAQSIMI® acquisition of up to an aggregate of $575 million contingent upon certain net sales milestones related to the BAQSIMI® acquisition, sponsor clinical trials for, seek regulatory approvals of, and develop, manufacture and market our current development stage product candidates and pursue strategic acquisitions of businesses or assets. Our future capital expenditures include projects to upgrade, expand, and improve our manufacturing facilities in the United States and China, including a significant increase in capital expenditures over the next few years. We plan to fund this facility expansion with cash flows from operations. Our cash obligations include the principal and interest payments due on our existing loans and lease payments, as described below and throughout this Quarterly Report.

Current wording

strategic acquisitions of businesses or assets. Our future capital expenditures include projects to upgrade, expand, and improve our manufacturing facilities in the United States and China, including a significant increase in capital expenditures over the next few years. We plan to fund this facility expansion with cash flows from operations. Our cash obligations include the principal and interest payments due on our existing loans and lease payments, as described below and throughout this Quarterly Report.

Previous wording

As of March 31, 2025, our foreign subsidiaries collectively held $17.3 million in cash and cash equivalents. Cash or cash equivalents held at foreign subsidiaries are not available to fund the parent company’s operations in the United States. We believe that our cash reserves, operating cash flows, and borrowing availability under our credit facilities will be sufficient to fund our operations for at least the next 12 months from the filing of this Quarterly Report on Form 10-Q. We expect additional cash flows to be generated in the longer term from future product introductions, although there can be no assurance as to the receipt of regulatory approval for any product candidates that we are developing or the timing of any product introductions, which could be lengthy or ultimately unsuccessful.

Current wording

As of June 30, 2025, our foreign subsidiaries collectively held $9.7 million in cash and cash equivalents. Cash or cash equivalents held at foreign subsidiaries are not available to fund the parent company’s operations in the United States. We believe that our cash reserves, operating cash flows, and borrowing availability under our credit facilities will be sufficient to fund our operations for at least the next 12 months from the filing of this Quarterly Report on Form 10-Q. We expect additional cash flows to be generated in the longer term from future product launches, although there can be no assurance as to the receipt of regulatory approval for any product candidates that we are developing or the timing of any product launches, which could be lengthy or ultimately unsuccessful.

Previous wording

Working capital increased $28.6 million to $388.9 million at March 31, 2025, compared to $360.3 million at December 31, 2024.

Current wording

Working capital increased $44.1 million to $404.4 million at June 30, 2025, compared to $360.3 million at December 31, 2024.

Previous wording

The following table summarizes our cash flows provided by and used in operating, investing, and financing activities for the three months ended March 31, 2025 and 2024:

Current wording

The following table summarizes our cash flows provided by and used in operating, investing, and financing activities for the six months ended June 30, 2025 and 2024:

Previous wording

Net cash provided by operating activities was $35.1 million for the three months ended March 31, 2025, which included net income of $25.3 million. Non-cash items comprised primarily of $16.0 million of depreciation and amortization, which includes $7.4 million related to depreciation of property, plant and equipment; $6.2 million related to amortization of intangible assets; $1.6 million related to amortization of operating lease right-of-use assets; $0.8 million related to amortization of discounts, premiums, and debt issuance costs; and share-based compensation expense of $8.4 million.

Current wording

Net cash provided by operating activities was $70.7 million for the six months ended June 30, 2025, which included net income of $56.3 million. Non-cash items comprised primarily of $33.0 million of depreciation and amortization, which includes $15.7 million related to depreciation of property, plant and equipment; $12.5 million related to amortization of intangible assets; $3.2 million related to amortization of operating lease right-of-use assets; $1.6 million related to amortization of discounts, premiums, and debt issuance costs; and share-based compensation expense of $14.8 million.

Previous wording

Additionally, for the three months ended March 31, 2025, there was a net cash outflow from changes in operating assets and liabilities of $16.7 million, which resulted primarily from an increase in accounts receivables and an increase in inventories, which was partially offset by an increase in accounts payable and accrued liabilities. The increase in accounts receivables was primarily due to the timing of sales in the quarter. The increase in inventories was primarily due to the increased purchases of finished product, raw materials and components for BAQSIMI®, as we assumed full responsibility for the supply chain from Lilly. Accounts payable and accrued liabilities increased primarily due to the increase in accrued customer fees and rebates associated with BAQSIMI® sales.

Current wording

Additionally, for the six months ended June 30, 2025, there was a net cash outflow from changes in operating assets and liabilities of $35.2 million, which resulted primarily from an increase in inventories. This was partially offset by an increase in accounts payable and accrued liabilities and a decrease in accounts receivable. The increase in inventories was primarily due to the increased purchases of finished product, raw materials and components for BAQSIMI®, as we assumed full responsibility for the supply chain from Lilly. Accounts payable and accrued liabilities increased primarily due to the increase in accrued customer fees and rebates, mainly associated with BAQSIMI® sales. The decrease in accounts receivables was primarily due to the timing of sales.

Previous wording

Net cash provided by operating activities was $55.3 million for the three months ended March 31, 2024, which included net income of $43.2 million. Non-cash items comprised primarily of $16.1 million of depreciation and amortization, which includes $6.8 million related to deprecation of property, plant and equipment, $6.2 million related to amortization of intangible assets, $2.1 million related to amortization of discounts, premiums, and debt issuance costs. Additionally, non-cash items included share-based compensation expense of $7.4 million. Additionally, for the three months ended March 31, 2024, there was a net cash outflow from changes in operating assets and liabilities of $7.3 million, which resulted from an increase in accounts receivables and an increase in inventories, which was partially offset by an increase in accounts payable and accrued liabilities. Accounts payable and accrued liabilities increased primarily due to the increase in accrued customer fees and rebates associated with BAQSIMI® sales. The increase in accounts receivables was primarily due to the increase in sales, as well as the timing of payment from Lilly for BAQSIMI® revenues during the quarter, which was received subsequent to the quarter end.

Current wording

Additionally, for the six months ended June 30, 2024, there was a net cash inflow from changes in operating assets and liabilities of $1.4 million, which resulted primarily from an increase in accounts payable and accrued liabilities, which was partially offset by an increase in accounts receivables and inventories. Accounts payable and accrued liabilities increased primarily due to the increase in accrued customer fees and rebates associated with BAQSIMI® sales. The increase in accounts receivables was primarily due to the increase in sales. The increase in inventories was primarily due to the increased purchases of certain raw materials and components.

Previous wording

Net cash provided by investing activities was $10.5 million for the three months ended March 31, 2025, primarily as a result of $21.2 million from sales and purchases of investments during the quarter. This was partially offset by $10.7 million in purchases of property, plant, and equipment, which included $7.8 million incurred in the United States, $0.6 million in France, and $2.3 million in China.

Current wording

Net cash provided by investing activities was $9.9 million for the six months ended June 30, 2025, primarily as a result of $35.7 million from sales and purchases of investments during the period. This was partially offset by $21.3 million in purchases of property, plant, and equipment, which included $13.5 million incurred in the United States, $1.4 million in France, and $6.3 million in China.

Previous wording

Net cash provided by investing activities was $15.2 million for the three months ended March 31, 2024, primarily as a result of a net cash inflow of $25.0 million from sales and purchases of investments during the quarter. This was partially offset by $8.8 million in purchases of property, plant, and equipment, which included $3.7 million incurred in the United States, $0.4 million in France, and $4.7 million in China.

Current wording

Net cash used in investing activities was $54.7 million for the six months ended June 30, 2024, primarily due to the payment of $129.0 million relating to the BAQSIMI® acquisition, $14.8 million in purchases of property, plant, and equipment, which included $6.9 million incurred in the United States, $1.6 million in France, and $6.3 million in China. This was partially offset by a net cash inflow of $90.8 million from sales and purchases of investments during the period.

Previous wording

Net cash used in financing activities was $13.6 million for the three months ended March 31, 2024, primarily as a result of $17.3 million used to settle share-based compensation awards under our equity plan and for tax payments related to the net share settlement of options exercised. This was partially offset by $4.1 million of net proceeds from borrowings on our line of credit.

Current wording

Net cash used in financing activities was $44.7 million for the six months ended June 30, 2025, primarily as a result of $50.2 million used to purchase treasury stock. This was partially offset by $5.8 million of net proceeds from borrowings on our line of credit in China.

Previous wording

Net cash used in financing activities was $14.5 million for the three months ended March 31, 2025, primarily as a result of $11.0 million used to purchase treasury stock and a net of $4.7 million used to settle share-based compensation awards under our equity plan and for tax payments related to the net share settlement of options exercised. This was partially offset by $1.6 million of net proceeds from borrowings on our line of credit in China.

Current wording

Net cash used in financing activities was $24.3 million for the six months ended June 30, 2024, primarily as a result of $11.5 million used to settle share-based compensation awards under our equity plan and for tax payments related to the net share settlement of options exercised and $8.5 million used to purchase treasury stock. Additionally, we made $8.1 million in principal payments on our long-term debt, primarily as a result of paying off the mortgage loan with East West Bank. This was partially offset by $4.1 million of net proceeds from borrowings on our line of credit in China.

Previous wording

Our products and facilities are subject to regulation by a number of federal and state governmental agencies. The FDA, in particular, maintains oversight of the formulation, manufacture, distribution, packaging, and labeling of all of our products. The Drug Enforcement Administration, or DEA, maintains oversight over our products that are considered controlled substances.

Current wording

Our products and facilities are subject to regulation by a number of federal and state governmental agencies. The FDA, in particular, maintains oversight of the formulation, manufacture, distribution, packaging, and labeling of all of our

Previous wording

Our manufacturing facilities as well as our CMOs are subject to periodic inspection by the FDA to ensure that they are operating in compliance with cGMP requirements. As of March 31, 2025, all of our manufacturing facilities and our CMOs are in compliance with all federal and state governmental agencies, including all FDA and DEA regulations. During the three months ended March 31, 2025, we had inspections conducted by the FDA at one of our manufacturing facilities, which resulted in no observations on Form 483.

Current wording

Our manufacturing facilities as well as our CMOs are subject to periodic inspection by the FDA to ensure that they are operating in compliance with cGMP requirements. We believe that as of June 30, 2025, all of our manufacturing facilities and our CMOs are in compliance with all applicable regulations of federal and state governmental agencies, including all those of the FDA and DEA. During the six months ended June 30, 2025, we had inspections conducted by various regulatory agencies at some of our manufacturing facilities, which resulted in no major observations.