Aquestive Therapeutics, Inc.

Previous wording

These forward-looking statements are based on our current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Such risks and uncertainties include, but are not limited to, risks associated with our development work, including any delays or changes to the timing, cost and success of our product development activities and clinical trials and plans, including those relating to Anaphylm (including for pediatric patients), AQST-108, and our other product candidates; risk of delays in advancement of the regulatory approval process through the FDA of our product candidates, including the filing and acceptance of the respective NDAs, for Anaphylm, AQST-108, Libervant for patients aged between 6 and 11 and other product candidates, or failure to receive FDA approval at all of any of these product candidates; risk of whether the Company’s clinical data is sufficient for approval of our product candidates, including with respect to our PK/PD comparability submission for FDA approval of Anaphylm; risks associated our ability to address the FDA’s comments on our future clinical trials and other concerns identified in the FDA Type C meeting minutes for Anaphylm, including the risk that the FDA may require additional clinical studies for approval of Anaphylm; risks associated with the success of any competing products, including generics; risk that we may not overcome the seven year orphan drug market exclusivity granted by the FDA for the approved nasal spray product of another company in the U.S. in order for Libervant to be granted U.S. market access for patients prior to expiration of the orphan drug market exclusivity period of the nasal spray product, which is due to occur in January 2027, or for other reasons; risks and uncertainties inherent in commercializing a new product (including technology risks, financial risks, market risks and implementation risks and regulatory limitations); risk of development of a sales and marketing capability for commercialization of our product candidates, including Anaphylm and AQST-108; risks associated with the potential impact on the value of the Company of the sale or outlicensing of our product and product candidates, including Libervant and Anaphylm and other product candidates; risk of insufficient capital and cash resources, including insufficient access to available debt and equity financing, including under our ATM facility, and revenues from operations, to satisfy all of our short-term and longer-term liquidity and cash requirements and other cash needs, at the times and in the amounts needed, including to commence principal payments on our 13.5% Notes in 2026 and to fund future clinical development and commercial activities for our product candidates, including Anaphylm, AQST-108 and Libervant for patients aged between 6 and 11, should these product candidates be approved by…

Excerpt shortened here; the source contains the full paragraph.

Current wording

Certain statements in Form 10-Q include “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “believe,” “anticipate,” “plan,” “expect,” “estimate,” “intend,” “may,” “will,” or the negative of those terms, and similar expressions, are intended to identify forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding the advancement and related timing of our product candidate Anaphylm™ (epinephrine) Sublingual Film through clinical development and approval by the U.S. Food and Drug Administration (FDA), including the filing and acceptance of the New Drug Application (NDA) for Anaphylm with the FDA, and the following commercial launch of Anaphylm, if approved by the FDA; the potential for an advisory committee for Anaphylm, if required by the FDA; timing of potential international regulatory filings for Anaphylm and market approval outside of the U.S. for our product candidates including Anaphylm and Libervant; that Anaphylm will be the first and only oral administration of epinephrine and accepted as an alternative to existing standards of care, if Anaphylm is approved by the FDA; the advancement, growth and related timing of our Adrenaverse™ pipeline of epinephrine prodrug product candidates, including AQST-108 (epinephrine) Topical Gel through clinical development and FDA regulatory approval process; the potential benefits our products and product candidates could bring to patients; the achievement of clinical and commercial milestones; our future financial and operating results and financial position, including with respect to our 2025 financial outlook and estimated cash runway; and business strategies, market opportunities, and other statements that are not historical facts. These forward-looking statements are based on our current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Such risks and uncertainties include, but are not limited to, risks associated with our development work, including any delays or changes to the timing, cost and success of our product development activities and clinical trials and plans, including those relating to Anaphylm, AQST-108, and our other product candidates; risk of delays in advancement of the regulatory approval process through the FDA of our product candidates, including for Anaphylm and AQST-108, or failure to receive FDA approval at all of any of these product candidates; risk of the Company’s ability to generate sufficient clinical data for approval of our product candidates, including with respect to our PK/PD comparability submission for FDA approval of Anaphylm; risks associated with our ability to address the FDA’s comments on our NDA, including the risk that the FDA may require additional clinical studies for approval of Anaphylm; risks assoc…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

In October 2024, we reported positive topline data from an oral allergy syndrome challenge study (now referred to as the "OASIS" study), meeting both primary and secondary endpoints. The two-part study demonstrated that Anaphylm's PK and PD profile during allergen-induced oral physiological changes was consistent with its profile without an allergen challenge. In addition, following allergen exposure where 94% of subjects exhibited moderate to severe symptoms per the predefined oral severity score, rapid symptom resolution was observed beginning as early as 2 minutes post-administration. The median time to complete symptom resolution was 12 minutes compared to 74 minutes at screening baseline, with 50% of all symptoms across all subjects resolving by 5 minutes. The mean time of symptom resolution for edema, which affected approximately 25% of subjects, was 5 minutes after Anaphylm administration. The PK profile remained consistent, with median Tmax maintained at 12 minutes and comparable Cmax values between allergen-exposed and non-exposed cohorts. The safety profile was favorable, with all adverse events classified as mild to moderate and resolving without medical intervention.

Current wording

Anaphylm's PK and PD profile during allergen-induced oral physiological changes was consistent with its profile without an allergen challenge. In addition, following allergen exposure where 94% of subjects exhibited moderate to severe symptoms per the predefined oral severity score, rapid symptom resolution was observed beginning as early as 2 minutes post-administration. The median time to complete symptom resolution was 12 minutes compared to 74 minutes at screening baseline, with 50% of all symptoms across all subjects resolving by 5 minutes. The mean time of symptom resolution for edema, which affected approximately 25% of subjects, was 5 minutes after Anaphylm administration. The PK profile remained consistent, with median Tmax maintained at 12 minutes and comparable Cmax values between allergen-exposed and non-exposed cohorts. The safety profile was favorable, with all adverse events classified as mild to moderate and resolving without medical intervention.

Previous wording

We completed the NDA submission to the FDA in the first quarter of 2025. The pediatric study in subjects from the ages of 7 to 17 (weight greater than or equal to 30 kgs) was completed with positive topline data reported on April 1, 2025. A total of thirty-two patients completed the study. The PK results were consistent with previous adult studies. Anaphylm was shown to be safe and well-tolerated with no serious adverse events reported. We are planning on initiating a product launch of Anaphylm, if approved by the FDA, in the first quarter of 2026. This anticipated timing is based on acceptance of the NDA submission by the FDA in the second quarter of 2025.

Current wording

We completed the NDA submission to the FDA in the first quarter of 2025. The pediatric study in subjects from the ages of 7 to 17 (weight greater than or equal to 30 kgs) was completed with positive topline data reported on April 1, 2025. A total of thirty-two patients completed the study. The PK results were consistent with previous adult studies. Anaphylm was shown to be safe and well-tolerated with no serious adverse events reported.

Previous wording

Our portfolio also includes other products and product candidates that we have licensed, or will seek to license, or for which we have licensed our intellectual property for commercialization. In the three months ended March 31, 2025 and 2024, our licensed product portfolio generated $8,720 and $12,053 in revenue to Aquestive, respectively. Those products include:

Current wording

Our portfolio also includes other products and product candidates that we have licensed, or will seek to license, or for which we have licensed our intellectual property for commercialization. In the six months ended June 30, 2025 and 2024, our licensed product portfolio generated $18,723 and $32,152 in revenue to Aquestive, respectively. Those products include:

Previous wording

•Suboxone® – a sublingual film formulation of buprenorphine and naloxone, respectively an opioid agonist and antagonist, that is marketed in the United States and internationally for the treatment of opioid dependence. Suboxone was launched by our licensee, Indivior, in 2010. Suboxone is the most prescribed branded product in its category and was the first sublingual film product for the treatment of opioid dependence. We are the sole and exclusive supplier and manufacturer of Suboxone and have produced over 2.8 billion doses of Suboxone since its launch in 2010. As of March 31, 2025, Suboxone branded products retain approximately 27% film market share as generic film-based products have penetrated this market. We have filed patent infringement lawsuits against certain companies relating to generic film-based products for buprenorphine-naloxone. More details regarding these lawsuits are described in the accompanying condensed financial statements, Note 20, Contingencies, contained herein.

Current wording

•Suboxone® – a sublingual film formulation of buprenorphine and naloxone, respectively an opioid agonist and antagonist, that is marketed in the United States and internationally for the treatment of opioid dependence. Suboxone was launched by our licensee, Indivior, in 2010. Suboxone is the most prescribed branded product in its category and was the first sublingual film product for the treatment of opioid dependence. We are the sole and exclusive supplier and manufacturer of Suboxone and have produced over 2.9 billion doses of Suboxone since its launch in 2010. As of June 30, 2025, Suboxone branded products retain approximately 26% film market share as generic film-based products have penetrated this market. We have filed patent infringement lawsuits against certain companies relating to generic film-based products for buprenorphine-naloxone. More details regarding these lawsuits are described in the accompanying condensed financial statements, Note 20, Contingencies, contained herein.

Previous wording

During the fourth quarter of 2019, we announced the grant of a license to Zambon for the development and commercialization of Exservan in the EU for the treatment of ALS which it markets as Emylif®. Zambon is a multinational pharmaceutical company with a focus on the CNS therapeutic area. Under the terms of the license agreement with Zambon, an upfront payment was paid to Aquestive for the development and commercialization rights of Emylif in the EU, and Aquestive will be paid development and sales milestone payments and low double-digit royalties on net sales of the product in the EU. Zambon is responsible for the regulatory approval and marketing of Emylif in the countries where Zambon seeks to market the product and Aquestive is responsible for the development and manufacture of the product. During the second quarter of 2023, Aquestive received a $0.5 million milestone payment in connection with the first commercial sale in the first country in the licensed territory for Emylif pursuant to the terms of the license agreement with Zambon.

Current wording

During the fourth quarter of 2019, we announced the grant of a license to Zambon for the development and commercialization of Exservan in the EU for the treatment of ALS which it markets as Emylif®. Zambon is a multinational pharmaceutical company with a focus on the CNS therapeutic area. Under the terms of the license agreement with Zambon, an upfront payment was paid to Aquestive for the development and commercialization rights of Emylif in the EU, and Aquestive will be paid development and sales milestone payments and low double-digit royalties on net sales of the product in the EU. Zambon is responsible for the regulatory approval and marketing of Emylif in the countries where Zambon seeks to market the product and Aquestive is responsible for the development and manufacture of the product. During the second quarter of 2025, Aquestive earned a $500 milestone payment in connection with the sale of Emylif pursuant to the terms of the license agreement with Zambon.

Previous wording

In January 2021, we announced that we granted an exclusive license to MTPA for the commercialization in the United States of Exservan. MTPA is a multinational pharmaceutical company with a focus on patients with ALS. The product was launched by MTPA in June 2021. Under the terms of the MTPA license agreement, Aquestive was the exclusive manufacturer and supplier of Exservan for MTPA in the United States. In June 2024, the Company and MTPA mutually agreed to terminate the MTPA Licensing Agreement.

Current wording

In January 2021, we announced that we granted an exclusive license to MTPA for the commercialization in the United States of Exservan. MTPA is a multinational pharmaceutical company with a focus on patients with ALS. The product was launched by MTPA in June 2021. Under the terms of the MTPA license agreement, Aquestive was the exclusive manufacturer and supplier of Exservan for MTPA in the United States. In June 2024, the Company and MTPA mutually agreed to terminate the MTPA Licensing Agreement. See Note 6, Material Agreementsto our accompanying condensed financial statements for details.

Previous wording

In March 2022, we announced the grant of an exclusive license to Haisco for Haisco to develop and commercialize Exservan for the treatment of ALS in China. Haisco is a China-based public pharmaceutical company. Haisco lead the regulatory and commercialization activities for Exservan in China. Aquestive was the exclusive sole manufacturer and supplier for Exservan in China. Under the terms of the license agreement with Haisco, as amended, Aquestive received a $7.0 million upfront payment in September 2022, and was to receive regulatory milestone payments, double-digit royalties on net sales of Exservan in China, and earn manufacturing revenue upon the sale of Exservan in China. In June 2024, Aquestive and Haisco mutually agreed to terminate the Haisco Agreement.

Current wording

In March 2022, we announced the grant of an exclusive license to Haisco for Haisco to develop and commercialize Exservan for the treatment of ALS in China. Haisco is a China-based public pharmaceutical company. Haisco lead the regulatory and commercialization activities for Exservan in China. Aquestive was the exclusive sole manufacturer and supplier for Exservan in China. Under the terms of the license agreement with Haisco, as amended, Aquestive received a $7,000 upfront payment in September 2022, and was to receive regulatory milestone payments, double-digit royalties on net sales of Exservan in China, and earn manufacturing revenue upon the sale of Exservan in China. In June 2024, Aquestive and Haisco mutually agreed to terminate the Haisco Agreement. See Note 6, Material Agreementsto our accompanying condensed financial statements for details.

Previous wording

•Ondif® – an oral soluble film formulation of ondansetron, a 5-HT antagonist, was developed for the treatment of nausea and vomiting associated with chemotherapy and post-operative recovery. Ondansetron is available as branded and generic products as intravenous injections, intramuscular injections, orally dissolving tablets, oral solution tablets, and film. We licensed commercial rights for this product to Hypera in Brazil (which Hypera markets as Ondif). Hypera received approval to market Ondif in Brazil from ANVISA on February 21, 2022. Aquestive manufactures and supplies Ondif to Hypera. This product was originally approved and marketed in the U.S. under the name Zuplenz®.

Current wording

•Ondif® – an oral soluble film formulation of ondansetron, a 5-HT antagonist, was developed for the treatment of nausea and vomiting associated with chemotherapy and post-operative recovery. Ondansetron is available as branded and generic products as intravenous injections, intramuscular injections, orally dissolving tablets, oral solution tablets, and film. We licensed commercial rights for this product to Hypera in Brazil (which Hypera markets as Ondif). Hypera received approval to market Ondif in Brazil from ANVISA on February 21, 2022. Aquestive manufactures and supplies Ondif to Hypera. This product was originally approved and marketed in the U.S. under the name Zuplenz®. We submitted a request for voluntary withdrawal of the NDA for Zuplenz, as the product is no longer marketed in the U.S. In November 2024, the request for FDA withdrawal of the NDA for Zuplenz was completed.

Previous wording

•Libervant® -We entered into the Pharmanovia Agreement with Pharmanovia, effective as of September 26, 2022, pursuant to which we granted Pharmanovia an exclusive license to certain of our intellectual property to develop and commercialize Libervant for the treatment of prolonged or acute, convulsive seizures in all ages in certain countries of the Territory, as defined in the Pharmanovia Agreement, during the term of the Pharmanovia Agreement. Under the Pharmanovia Agreement, Pharmanovia will lead the regulatory and commercialization activities for Libervant in the Territory and Aquestive will serve as the exclusive sole manufacturer and supplier of Libervant in the Territory. We received $3.5 million upon agreement execution. Effective March 27, 2023, we amended the Pharmanovia Agreement to expand the scope of the licensed territory for Libervant to cover the rest of the world, excluding the U.S., Canada and China. Pharmanovia will be responsible for seeking appropriate regulatory approval in the expanded territories. Pursuant to the terms of the Pharmanovia Amendment, we received a non-refundable payment of $2.0 million from Pharmanovia on execution of the Pharmanovia Amendment.

Current wording

Territory and Aquestive will serve as the exclusive sole manufacturer and supplier of Libervant in the Territory. We received $3.5 million upon agreement execution. Effective March 27, 2023, we amended the Pharmanovia Agreement to expand the scope of the licensed territory for Libervant to cover the rest of the world, excluding the U.S., Canada and China. Pharmanovia will be responsible for seeking appropriate regulatory approval in the expanded territories. Pursuant to the terms of the Pharmanovia Amendment, we received a non-refundable payment of $2.0 million from Pharmanovia on execution of the Pharmanovia Amendment.

Previous wording

We remain a “smaller reporting company”, meaning we are not an investment company, an asset-backed issuer, or a majority-owned subsidiary of a parent company that is not a "smaller reporting company" which allows us to take advantage of many of the same exemptions from disclosure requirements including reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and certain reduced financial disclosures in our periodic reports. In addition, we are eligible to remain a smaller reporting company, for so long as we have a public float (based on our Common Stock equity) of less than $250 million measured as of the last business day of our most recently completed second fiscal quarter or a public float (based on our Common Stock equity) of less than $700 million as of such date and annual revenues of less than $100 million during the most recently completed fiscal year. We cannot predict if investors will find our Common Stock less attractive because we may rely on these exemptions. If some investors find our Common Stock less attractive as a result of these disclosure exemptions, there may be a less active trading market for our Common Stock and our stock price may be more volatile.

Current wording

We are a “smaller reporting company”, meaning we are not an investment company, an asset-backed issuer, or a majority-owned subsidiary of a parent company that is not a "smaller reporting company" which allows us to take advantage of certain exemptions from disclosure requirements including reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and certain reduced financial disclosures in our periodic reports. In addition, we are eligible to remain a smaller reporting company, for so long as we have a public float (based on our Common Stock equity) of less than $250 million measured as of the last business day of our most recently completed second fiscal quarter or a public float (based on our Common Stock equity) of less than $700 million as of such date and annual revenues of less than $100 million during the most recently completed fiscal year. We cannot predict if investors will find our Common Stock less attractive because we may rely on these exemptions. If some investors find our Common Stock less attractive as a result of these disclosure exemptions, there may be a less active trading market for our Common Stock and our stock price may be more volatile.

Previous wording

Co-development and research fees are earned through performance of specific tasks, activities or completion of stages of development defined within a contractual development or feasibility study agreement with a customer. The nature of these performance obligations, broadly referred to as milestones or deliverables, are usually dependent on the scope and structure of the project as contracted, as well as the complexity of the product and the specific regulatory approval path necessary for that product. Accordingly, the duration of our research and development projects may range from several months to as long as three years. Although each contractual arrangement is unique, common milestones contained in these arrangements include those for the performance of efficacy and other tests, reports of findings, formulation of initial prototypes, production of stability clinical and/or scale-up batches, and stability testing of those batches. Additional milestones may be established and linked to clinical results of the product submission and/or approval of the product by the FDA and the commercial launch of the product.

Current wording

Co-development and research fees are earned through performance of specific tasks, activities or completion of stages of development defined within a contractual development or feasibility study agreement with a customer. The nature of these performance obligations, broadly referred to as milestones or deliverables, are usually dependent on the scope and structure of the project as contracted, as well as the complexity of the product and the specific regulatory approval path necessary for that product. Accordingly, the duration of our R&D projects may range from several months to as long as three years. Although each contractual arrangement is unique, common milestones contained in these arrangements include those for the performance of efficacy and other tests, reports of findings, formulation of initial prototypes, production of stability clinical and/or scale-up batches, and stability testing of those batches. Additional milestones may be established and linked to clinical results of the product submission and/or approval of the product by the FDA and the commercial launch of the product.

Previous wording

This net revenue is recognized when product is shipped and title passes to the customer, typically at time of delivery. At the time of sale, estimates for various revenue allowances are recorded based on historical trends and judgmental estimates. For sales of Libervant for patients between two to five years of age, returns allowances and prompt pay discounts are estimated based on contract terms and historical return rates, if available, and these estimates are recorded as a reduction of receivables. Similarly determined estimates are recorded relating to wholesaler service fees, co-pay support redemptions, and other rebates, and these estimates are reflected as a component of accrued liabilities. Once all related variable considerations are resolved and uncertainties as to collectable amounts are eliminated, estimates are adjusted to actual allowance amounts. Provisions for these estimated amounts are reviewed and adjusted on no less than a quarterly basis.

Current wording

This net revenue is recognized when product is shipped and title passes to the customer, typically at time of delivery. At the time of sale, estimates for various revenue allowances are recorded based on historical trends and judgmental estimates. For sales of Libervant for patients between two to five years of age while Libervant had U.S. market access through April 2025, returns allowances and prompt pay discounts are estimated based on contract terms and historical return rates, if available, and these estimates are recorded as a reduction of receivables. Once receivables are collected, allowances are reclassified and treated as accrued liabilities. Similarly determined estimates are recorded relating to wholesaler service fees, co-pay support redemptions, and other rebates, and these estimates are reflected as a component of accrued liabilities. Once related variable considerations are resolved and uncertainties as to incurred amounts are eliminated, estimates are adjusted to actual allowance amounts. Provisions for these estimated amounts are reviewed and adjusted on no less than a quarterly basis.

Previous wording

Since our inception, we have focused significant resources on our research and development activities. Research and development expenses primarily consist of:

Current wording

Since our inception, we have focused significant resources on our R&D activities. R&D expenses primarily consist of:

Previous wording

•external research and development expenses incurred under arrangements with third parties, such as CROs, investigational sites and consultants;

Current wording

•external R&D expenses incurred under arrangements with third parties, such as CROs, investigational sites and consultants;

Previous wording

We expect our research and development expenses to continue to be significant over the next several years as we continue to develop existing product candidates such as Anaphylm, AQST-108 and others, and as we identify and develop or acquire additional product candidates and technologies. We may hire or engage additional skilled colleagues or third parties to perform these activities, conduct clinical trials and ultimately seek regulatory approvals for any product candidate that successfully completes those clinical trials.

Current wording

We expect our R&D expenses to continue to be significant over the next several years as we continue to develop existing product candidates such as Anaphylm, AQST-108 and others, and as we identify and develop or acquire additional product candidates and technologies. We may hire or engage additional skilled colleagues or third parties to perform these activities, conduct clinical trials and ultimately seek regulatory approvals for any product candidate that successfully completes those clinical trials.

Previous wording

Selling, General and Administrative expenses consist primarily of salaries, benefits, share-based compensation, other related costs for executive, finance, and operational personnel. Other costs include facility and related costs not otherwise included in research and development expenses such as: professional fees for patent-related and other legal expenses, regulatory fees, consulting, tax and accounting services; insurance; market research; advisory board and key opinion leaders; depreciation; and general corporate expenses, inclusive of IT systems related costs. In addition, these expenses also include warehousing, distribution, selling and business development, and other costs.

Current wording

Selling, General and Administrative expenses consist primarily of salaries, benefits, share-based compensation, other related costs for executive, finance, and operational personnel. Other costs include facility and related costs not otherwise included in R&D expenses such as: professional fees for patent-related and other legal expenses, regulatory fees, consulting, tax and accounting services; insurance; market research; advisory board and key opinion leaders; depreciation; and general corporate expenses, inclusive of IT systems related costs. In addition, these expenses also include warehousing, distribution, selling and business development, and other costs.

Previous wording

In connection with the issuance of the 13.5% Notes, we entered into the Royalty Rights Agreements with each of the Note Holders granting the Note Holders a tiered royalty between 1.0% and 2.0% of annual worldwide net sales of Anaphylm (epinephrine) Sublingual Film for a period of eight years from the first sale of Anaphylm on a global basis. The Note Holders are also entitled to a tiered royalty between 1.0% to 2.0% of annual worldwide net sales of Libervant (diazepam) Buccal Film until the earlier of (1) the first sale of Anaphylm and (2) eight years from the first sale of Libervant. These royalty agreements are classified as debt, and the value of the $45,000 13.5% Notes has been allocated between debt and the Royalty Obligations based on their relative fair market values. The excess of future estimated royalty payments of $56,828 over the $13,758 of the allocated fair value is recognized as a discount related to the Royalty Right Agreements and is amortized as interest expense using the effective interest method. The 13.5% Notes are discussed in Note 14, Long-Term Debtto our Condensed Financial Statements.

Current wording

In connection with the issuance of the 13.5% Notes, we entered into the Royalty Rights Agreements with each of the Note Holders granting the Note Holders a tiered royalty between 1.0% and 2.0% of annual worldwide net sales of Anaphylm (epinephrine) Sublingual Film for a period of eight years from the first sale of Anaphylm on a global basis. The Note Holders are also entitled to a tiered royalty between 1.0% to 2.0% of annual worldwide net sales of Libervant (diazepam) Buccal Film until the earlier of (1) the first sale of Anaphylm and (2) eight years from the first sale of Libervant. These royalty agreements are classified as debt, and the value of the $45,000 13.5% Notes has been allocated between debt and the Royalty Obligations based on their relative fair market values. The excess of future estimated royalty payments of $56,546 over the $13,476 of the allocated fair value is recognized as a discount related to the Royalty Right Agreements and is amortized as interest expense using the effective interest method. The 13.5% Notes are discussed in Note 14, Long-Term Debtto our Condensed Financial Statements.

Previous wording

Comparison of the Three Months Ended March 31, 2025 and 2024

Current wording

Comparison of the Three and Six Months Ended June 30, 2025 and 2024

Previous wording

Three Months Ended March 31, 2025 and 2024

Current wording

Three Months Ended June 30, 2025 Compared to Three Months Ended June 30, 2024

Previous wording

For the three months ended March 31, 2025, total revenues decreased 28%, or $3,333 compared to the same period in the prior year primarily due to decreases in manufacture and supply revenue and license and royalty revenue , partially offset by increases in proprietary product revenue, net.

Current wording

For the three months ended June 30, 2025, total revenues decreased 50%, or $10,096, compared to the same period in the prior year primarily due to decreases in license and royalty revenue and proprietary product revenue, net partially offset by increases in manufacture and supply revenue.

Previous wording

Manufacture and supply revenue decreased approximately 32%, or $3,325 for the three months ended March 31, 2025 compared to the same period in the prior year. This decrease was primarily due to a $4,463 decrease in Suboxone revenues, partially offset by a $1,471 increase in Ondif revenues due to timing of orders.

Current wording

Manufacture and supply revenue decreased approximately 10%, or $1,865, for the six months ended June 30, 2025 compared to the same period in the prior year. This decrease was primarily due to a $4,898 decrease in Suboxone revenues, partially offset by a $3,422 increase in Ondif revenues.

Previous wording

Co-development and research fees for the three months ended March 31, 2025 remained relatively consistent compared to the same period in the prior year.

Current wording

Manufacture and supply costs and expenses and R&D expenses for the three months ended June 30, 2025 remained relatively consistent compared to the same period in the prior year.

Previous wording

Selling, general and administrative expenses increased 78% or $8,383 for the three months ended March 31, 2025 as compared to the same period in the prior year. The increase primarily represents regulatory fees related to the Anaphylm PDUFA fee of approximately $4,310, higher legal fees of $2,250, higher commercial spending of approximately $2,130, higher regulatory and licensing fees of approximately $505 related to the regulatory fee for Libervant, higher personnel costs of approximately $440, and higher share-based compensation expenses of $310, partially offset by decreases in severance costs of approximately 1,100 and lower insurance expenses of $240.

Current wording

Selling, general and administrative expenses increased 12% or $1,349 for the three months ended June 30, 2025 as compared to the same period in the prior year. The increase primarily represents higher commercial spending of approximately $2,040, higher regulatory and licensing fees of approximately $630 related to the acceleration of the recognition of the regulatory fee for Libervant due to the change in regulatory status, higher personnel costs of approximately $400, higher regulatory expenses related to Anaphylm of approximately $240, higher share-based compensation expenses of approximately $230, and higher consulting fees of approximately $170, partially offset by lower legal fees of approximately $2,510 and lower insurance expenses of $240.

Previous wording

Interest expense was $2,782 and $2,784 for the three months ended March 31, 2025 and 2024, respectively. These amounts represent interest incurred on the outstanding 13.5% Notes, and amortization of the debt discount and capitalized debt issuance costs.

Current wording

Interest expense was $2,781 and $2,779 for the three months ended June 30, 2025 and 2024, respectively. These amounts represent interest incurred on the outstanding 13.5% Notes, and amortization of the debt discount and capitalized debt issuance costs.

Previous wording

Interest expense related to amortization of the discount on the royalty obligations was $1,437 and $1,358 for the three months ended March 31, 2025 and 2024, respectively. These amounts are due to the accounting associated with the royalty obligations as part of the 13.5% Notes issuance.

Current wording

Interest expense related to amortization of the discount on the royalty obligations was $1,434 and $1,358 for the three months ended June 30, 2025 and 2024, respectively. These amounts are due to the accounting associated with the royalty obligations as part of the 13.5% Notes issuance.

Previous wording

Interest expense related to the sale of future revenue was $59 and $58 for the three months ended March 31, 2025 and March 31, 2024, respectively, and represents amortization of the issuance costs. These amounts are due to the accounting associated with the sale of future revenue related to KYNMOBI royalties sold to Marathon on November 3, 2020 and do not represent or imply a monetary obligation or cash outflow at any time during the life of the transaction. In June 2023, Sunovion announced that it had voluntarily withdrawn KYNMOBI from the U.S. and Canadian markets. Therefore, the Company likely will not receive any of the additional contingent payments under the Monetization agreement. As a result, the Company discontinued recording interest expense related to the sale of future revenue in the fourth quarter of 2022. See Note 16, Sale of Future Revenue to our Condensed Financial Statements for details.

Current wording

Interest expense related to the sale of future revenue was $61 and $58 for the three months ended June 30, 2025 and 2024, respectively, and represents amortization of the issuance costs. These amounts are due to the accounting associated with the sale of future revenue related to KYNMOBI royalties sold to Marathon on November 3, 2020 and do not represent or imply a monetary obligation or cash outflow at any time during the life of the transaction. In June 2023, Sunovion announced that it had voluntarily withdrawn KYNMOBI from the U.S. and Canadian markets. Therefore, the Company likely will not receive any of the additional contingent payments under the Monetization agreement. As a result, the Company discontinued recording interest expense related to the sale of future revenue in the fourth quarter of 2022. See Note 16, Sale of Future Revenue to our Condensed Financial Statements for details.

Previous wording

Interest income and other income, net was $713 and $329 for the three months ended March 31, 2025 and 2024, respectively. The increase primarily represents higher investment income due to higher cash balances over a greater number of days invested in interest-bearing and dividend-earning money market accounts compared to the prior year period.

Current wording

Interest income and other income, net was $2,096 and $1,395 for the three months ended June 30, 2025 and 2024, respectively. The increase primarily represents a ERTC credit received in April 2025, partially offset by lower investment income due to a lower cash balance invested in interest-bearing and dividend-earning money market accounts compared to the prior year period. In June 2024, the Company recorded a gain of $1,500 on the termination of a license and supply agreement, which was partially offset by the adjustment of $1,200 to the remaining balance of the intangible asset due to the termination of the agreement.

Previous wording

Manufacture and supply costs and expenses decreased 17% or $737 for the three months ended March 31, 2025 compared to the same period in the prior year. The decrease was largely due to lower volume of strips sold and changes in product mix.

Current wording

Manufacture and supply costs and expenses decreased 8% or $702 for the six months ended June 30, 2025 compared to the same period in the prior year. The decrease was largely due to lower volume of strips sold and changes in product mix.

Previous wording

Research and development expenses decreased 10% or $571 for the three months ended March 31, 2025 compared to the same period in the prior year. The decrease in Research and development expenses is primarily due to lower clinical trial costs associated with the continued advancement of the Anaphylm program, partially offset by increases in product research and preclinical expenses, higher personnel costs and higher share-based compensation. The tables below provide a breakdown of the major costs included in total Research and development expenses and project costs by type of expense for each of the main clinical development projects in which we are engaged for each period presented:

Current wording

R&D expenses decreased 6% or $628 for the six months ended June 30, 2025 compared to the same period in the prior year. The decrease in R&D expenses is primarily due to a decrease in clinical trial costs associated with the continued advancement of the Anaphylm program, partially offset by increases in personnel costs, and an increase in share-based compensation. The tables below provide a breakdown of the major costs included in total R&D expenses and project costs by type of expense for each of the main clinical development projects in which we are engaged for each period presented:

Previous wording

Total project expenses for Anaphylm decreased 21%, or $659 over the comparable period in 2024. Anaphylm clinical trial expenses and development and manufacturing expenses decreased $1,053 and $119, respectively, over the comparable period in 2024, partially offset by increases in product research expenses of $513. During the three months ended March 31, 2025 and 2024, clinical trial expenses for Anaphylm of $1,922 and $2,975, respectively, were primarily due to clinical trial costs associated with the continued advancement of the Anaphylm program. Product research expenses for Anaphylm increased by $513, primarily related to expenses incurred for the preparation of the NDA filing. Total project expenses for AQST-108 decreased 75%, or $594, over the comparable period in 2024. AQST-108 clinical trial expenses and product research expenses decreased $407 and $188, respectively over the comparable period in 2024 due the clinical study and feasibility work for AQST-108 performed in the prior year period.

Current wording

Total project expenses for Anaphylm decreased 24%, or $1,155 over the comparable period in 2024. Anaphylm clinical trial expenses decreased $1,740 over the comparable period in 2024, partially offset offset increases in Anaphylm product research expenses of $689 due to the continued advancement of the Anaphylm program. Total project expenses for AQST-108 decreased $404 over the comparable period in 2024 due to the clinical study and feasibility work for AQST-108 performed in the prior year period.

Previous wording

R&D personnel costs increased by 17%, or $268 over the comparable period in 2024, due to additional headcount. R&D share-based compensation increased by $160, or 94% primarily related to the effect of RSU grants to R&D personnel. All other R&D expenses include rent, utilities, maintenance and other expenses and fees.

Current wording

R&D personnel costs increased by 11%, or $347, for the six months ended June 30, 2025 as compared to the same period in 2024, due to additional headcount. R&D share-based compensation increased by $260, or 54%, which was primarily related to the effect of RSU grants to R&D personnel. All other R&D expenses include rent, utilities, maintenance and other expenses and fees.

Previous wording

We had $68,657 in cash and cash equivalents as of March 31, 2025. While our ability to execute our business objectives and achieve profitability over the longer term cannot be assured, our on-going business, existing cash and cash equivalents, expense management activities, potential asset sales or product outlicensing as well as access to the equity capital markets, including through the ATM facility, provide near term liquidity for us to fund our operating needs for at least the next twelve months as we continue to execute our business strategy.

Current wording

We had $60,536 in cash and cash equivalents as of June 30, 2025. While our ability to execute our business objectives and achieve profitability over the longer term cannot be assured, our on-going business, existing cash and cash equivalents, expense management activities, potential asset sales or product outlicensing as well as access to the equity capital markets, including through the ATM facility, provide near term liquidity for us to fund our operating needs for at least the next twelve months as we continue to execute our business strategy.

Previous wording

We established our first ATM facility in September 2019, and since inception to March 31, 2025, we have sold 27,315,145 shares of Common Stock which has generated net cash proceeds of approximately $81,829, net of commissions and other transactions costs of $3,814. On April 3, 2024, we filed a new shelf registration statement on Form S-3 to register the offer and sale of up to $250,000 worth of shares of Common Stock, preferred stock, debt securities, warrants, rights and units ("Registration Statement No. 333-278498" or the "2024 Registration Statement"), that was declared effective by the SEC on April 23, 2024. Included as part of the 2024 Registration Statement was a $100,000 ATM facility, prospectus covering the offering, issuance and sale of Common Stock pursuant to the Amended Equity Distribution Agreement with Piper Sandler & Co.

Current wording

We established our first ATM facility in September 2019, and since inception to June 30, 2025, we have sold 27,315,145 shares of Common Stock which has generated net cash proceeds of approximately $81,794, net of commissions and other transactions costs of $3,849. On April 3, 2024, we filed a new shelf registration statement on Form S-3 to register the offer and sale of up to $250,000 worth of shares of Common Stock, preferred stock, debt securities, warrants, rights and units ("Registration Statement No. 333-278498" or the "2024 Registration Statement"), that was effective by the SEC on April 23, 2024. Included as part of the 2024 Registration Statement was a $100,000 ATM facility, prospectus covering the offering, issuance and sale of Common Stock pursuant to the Amended Equity Distribution Agreement with Piper Sandler & Co.

Previous wording

During the three months ended March 31, 2025, the Company sold 7,457,627 shares of Common Stock under the ATM facility which provided net proceeds of approximately $21,306 after deducting commissions and other transaction costs of $694 of which $89 remains unpaid as of March 31, 2025. During the three months ended March 31, 2024, we sold 4,557,220 shares of Common Stock under the ATM facility which provided net proceeds of approximately $12,012 after deducting commissions and other transaction costs of $373.

Current wording

During the three months ended June 30, 2025, there were no shares of Common Stock sold under the ATM facility. For the six months ended June 30, 2025, the Company sold 7,457,627 shares of Common Stock under the ATM facility which provided net proceeds of approximately $21,271 after deducting commissions and other transaction costs of $729. During the three months ended June 30, 2024, there were no shares of Common Stock sold under the ATM facility. For the six months ended June 30, 2024, the Company sold 4,557,220 shares under the ATM facility which provided net proceeds of approximately $11,855 after deducting commissions and other transaction costs of $530. The remaining authorized balance of the ATM facility was $78,000 as of June 30, 2025.

Previous wording

In August 2023, we entered into the Letter Agreement with the Exercising Holder of 5,000,000 of the remaining Common Stock Warrants. Pursuant to the Letter Agreement, the Exercising Holder and Aquestive agreed that the Exercising Holder would exercise all of its Existing Warrants at the then current exercise price of the Existing Warrants. The Exercising Holder subsequently exercised the Existing Warrants, with Aquestive receiving gross proceeds of $4,800. We also issued to the Exercising Holder New Warrants to purchase up to an aggregate of 2,750,000 shares of Common Stock. The New Warrants are exercisable after February 2, 2024, expire on February 2, 2029 and are exercisable only for cash, unless the shares of Common

Current wording

In August 2023, we entered into the Letter Agreement with the Exercising Holder of 5,000,000 of the remaining Common Stock Warrants. Pursuant to the Letter Agreement, the Exercising Holder and Aquestive agreed that the Exercising Holder would exercise all of its Existing Warrants at the then current exercise price of the Existing Warrants. The Exercising Holder subsequently exercised the Existing Warrants, with Aquestive receiving gross proceeds of $4,800. We also issued to the Exercising Holder New Warrants to purchase up to an aggregate of 2,750,000 shares of Common Stock. The New Warrants are exercisable after February 2, 2024, expire on February 2, 2029 and are exercisable only for cash, unless the shares of Common Stock underlying the New Warrants are not registered in accordance with the terms of the Letter Agreement, in which case the New Warrants may also be exercised by means of a "cashless exercise". The New Warrants have an exercise price of $2.60 per share.

Previous wording

On March 22, 2024, the Company completed the underwritten public offering of 16,666,667 shares of its Common Stock at the public offering price of $4.50 per share. At closing, Aquestive received net proceeds of $70,500 after deducting underwriting discounts of $4,500. In addition to the underwriting discounts related to this offering, the Company’s incurred professional fees and other costs totaling $687 as of March 31, 2024. In addition, pursuant to the partial exercise of the underwriters' option, on April 22, 2024, the Company sold an additional 559,801 shares of Common Stock, for additional gross proceeds of $2,519.

Current wording

On March 22, 2024, we completed the Underwritten Public Offering of 16,666,667 shares of its common stock at the public offering price of $4.50 per share. In addition, pursuant to the partial exercise of the underwriters' option, on April 22, 2024, we sold an additional 559,801 shares of Common Stock. Net proceeds from the Underwritten Public Offering, including the exercise of underwriters' option, were $72,868, after deducting underwriting discounts of $4,651. In addition to the underwriting discounts related to this offering, we incurred professional fees and other costs totaling $894.

Previous wording

Net cash used for operating activities for the three months ended March 31, 2025 increased by $13,016 compared to the same period in the prior year. The increase in cash used for operating activities was primarily related to the change in net loss of $10,102, increases in trade and other receivables of $3,276, and net changes in other liabilities.

Current wording

Net cash used for operating activities for the six months ended June 30, 2025 increased by $13,924 compared to the same period in the prior year. The increase in cash used for operating activities was primarily related to the increase in net loss of $20,905, increases in trade and other receivables of $6,962, and increases in inventories of $1,884, partially offset by changes in deferred revenue of $11,067 which were mostly attributed to the recognition of deferred revenues due to the termination of license and supply agreements during the three months ended June 30, 2024, and changes in prepaid expenses of $1,233 and other current liabilities of $2,882.

Previous wording

Net cash used for investing activities for the three months ended March 31, 2025 increased by $106 compared to the same period in the prior year. The use of cash was related to capital expenditures.

Current wording

Net cash used for investing activities for the six months ended June 30, 2025 increased by $178 compared to the same period in the prior year. The use of cash was related to capital expenditures.

Previous wording

Net cash provided by financing activities for the three months ended March 31, 2025 decreased by $61,095 compared to the same period in the prior year. The decrease was primarily related to no proceeds received from the underwritten public offering as compared to net proceeds of $70,126 received in the same period in the prior year, partially offset by higher ATM proceeds of $9,386 due to higher volumes and Common Stock prices as compared to the three months ended March 31, 2024.

Current wording

Net cash provided by financing activities for the six months ended June 30, 2025 decreased by $62,906 compared to the same period in the prior year. The decrease was primarily related to no proceeds received from the underwritten public offering as compared to net proceeds of $71,974 received in the same period in the prior year, partially offset by higher ATM proceeds of $9,419 due to higher volumes and Common Stock prices as compared to the six months ended June 30, 2024.