Biofrontera Inc.
For the period ended Mar 31, 2026. Filed May 14, 2026.
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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.
Mar 31, 2026 · Filed May 14, 2026
BFRI$0.83+2.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-12.
0001493152-25-021945
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-14.
0001493152-26-023119
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 134 previous paragraphs and 94 current paragraphs.
36 unchanged; 32 reworded; 25 added; 64 removed; 2 previous and 1 current paragraphs rearranged.
Tables are not compared: 12 previous and 7 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 (25)
Current report
Trademarks, Trade Names, and Service Marks
Current report
All trademarks, trade names, and service marks appearing in this Form 10-Q are the property of their respective owners. Solely for convenience, the trademarks and trade names in this Form 10-Q are referred to without the symbols ® and ™, but such references should not be construed as any indication that their respective owners will not assert their rights thereto to the fullest extent under applicable law. We do not intend to use or display other companies’ trademarks, trade names, or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies.
Current report
We conduct our clinical development activities and hold certain manufacturing-related assets through Discovery, our wholly owned German subsidiary. Our research and development (“R&D”) programs are focused on label expansion for Ameluz and on enhancing the RhodoLED Lamps to support adoption of PDT in the United States. SeeNote 1. Organization and Business Overview in our Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q for additional information about the Company and its subsidiary.
Current report
Strategic Transaction with the Biofrontera Group. On October 20, 2025, we entered into (i) an Asset Purchase Agreement (the “Transfer Agreement”) and (ii) an Earnout Agreement (together with the Transfer Agreement, the “Agreements”), with the Biofrontera Group, pursuant to which the Company finalized the agreements to acquire all rights in the United States (the “U.S. Rights”) to Ameluz and the RhodoLED Lamps (the “Strategic Transaction”). Pursuant to the terms of the Agreements, retroactive to June 1, 2025, the Company will pay a monthly earnout of 12% of United States revenues of Ameluz in years when United States net sales are $65.0 million or less and an earnout of 15% on all revenue in years when United States net sales of Ameluz exceed $65.0 million, continuing until the expiration of patent protection on Ameluz allows for generic competition in the United States. The earnout replaces a transfer pricing model under the Company’s Second Amended and Restated License and Supply Agreement (“Second A&R Ameluz LSA”) by and among the Company and the Biofrontera Group, which has now been terminated pursuant to the Agreements. The new structure reduces overall cost for the Company and is expected to accelerate the Company’s timeframe to reach break-even. The results of operations for the three months ended March 31, 2026 reflect a full quarter under this revised cost structure, while the three months ended March 31, 2025 reflect the prior transfer-pricing model. Period-over-period comparisons of cost of revenues and related-party cost of revenues are therefore affected by this change, as discussed further under “Results of Operations” below. SeeNote 12. Related Party Transactions in our Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q for additional information.
Current report
Compliance with Nasdaq Listing Standards.On December 31, 2025, we received a letter from Nasdaq notifying us that the listing of our common stock was not in compliance with Nasdaq Listing Rule 5550(a)(2) (the “the Minimum Bid Price Requirement”). On May 6, 2026, we received written notification from Nasdaq that we had regained compliance with the Minimum Bid Price Requirement and that the matter was closed. There can be no assurance that we will maintain compliance with the Minimum Bid Price Requirement or other continued listing standards in the future. SeeNote 18.Subsequent Events in our Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q for additional information.
Current report
ITC Matter. On May 6, 2026, the International Trade Commission issued a Notice of Final Determination finding a violation of Section 337 of the Tariff Act of 1930 with respect to two asserted patents involving certain components of our RhodoLED XL Lamps. The Commission issued a Limited Exclusion Order and Cease and Desist Orders, with the orders relating to the ‘028 patent suspended pending further proceedings before the U.S. Patent Trial and Appeal Board. SeeNote 16. Commitments and Contingencies for additional information regarding this matter, which is referred to herein as the “ITC Matter.”
Current report
Strategy
Current report
Key Factor Affecting Our Performance
Current report
Cost of Revenues, Related Party
Current report
Interest Income (Expense), net
Current report
Net product revenue for the three months ended March 31, 2026 was $10.1 million, an increase of $1.5 million, or 17.4%, compared to the three months ended March 31, 2025. The increase was primarily attributable to higher Ameluz® net sales, reflecting 15.9% growth in unit volume, as well as the full period impact of a price increase implemented in the fourth quarter of 2025 that contributed approximately $0.2 million revenue increase.
Current report
Cost of Revenues, Related Party
Current report
Cost of revenues, related party for the three months ended March 31, 2026 decreased $1.2 million, or 40.5%, compared to the three months ended March 31, 2025. The decrease was primarily driven by a reduction in the purchase price of Ameluz® resulting from the transition pursuant to the Strategic Transaction from the transfer pricing model in place under the now-terminated Second A&R Ameluz LSA, which was 25% of net revenue, to a significantly lower cost structure comprised only of Ameluz direct cost and the 12% earnout applied to the net revenue.
Current report
Selling, general and administrative expenses for the three months ended March 31, 2026 were $11.0 million, an increase of $2.3 million, or 27.1%, compared to the three months ended March 31, 2025. Selling and marketing expenses increased $0.8 million, reflecting the full deployment of the direct sales team and higher sales activity levels, including sales meetings, conferences, and exhibits, in support of improved commercial performance. General and administrative expenses increased $0.8 million, primarily due to legal expenses associated with ongoing patent-related claims. Further, in connection with the Strategic Transaction, the Company assumed responsibility for manufacturing operations beginning in the fourth quarter of 2025. Because we were in the process of securing approvals and licenses to commence manufacturing later in 2026, manufacturing-related costs of $0.6 million are reflected in selling, general and administrative expenses for the three months ended March 31, 2026.
Current report
Patent Remediation Expense
Current report
During the three months ended March 31, 2026, we recognized a total charge of approximately $0.4 million reflecting the estimated cost to remediate the affected units of our RhodoLED XL Lamps in response to ITC Matter. The total charge comprises (i) an inventory write-down of approximately $0.1 million to reduce the carrying value of affected finished goods inventory and obsolete components in raw materials to net realizable value in accordance with ASC 330-10-35, which were charged to cost of revenues, other, and (ii) an accrued remediation liability of approximately $0.4 million for the future cost activities charged to patent remediation expense.
Current report
We expect to incur the cash component of these costs over the twelve months following the 60-day Presidential Review period, concluding on July 6, 2026, as remediation activities are executed. In addition, the remediation is expected to result in a modest, recurring increase in our per-unit cost of revenues for affected products; this prospective impact is reflected in our cost of revenues as units implementing the remediation are produced and sold. We do not expect the recurring per-unit cost increase to be material to our overall cost of revenues.
Current report
Research and Development Expense
Current report
Research and development expenses for the three months ended March 31, 2026 decreased $0.3 million compared to the three months ended March 31, 2025. The decrease was primarily attributable to certain clinical trials reaching substantial completion ahead of their originally planned timelines, resulting in lower trial-related expenditures in the current year period.
Current report
The following table summarizes the major categories of our R&D expenses for the three months ended March 31, 2026 and 2025:
Current report
Patent Remediation Expense: During the three months ended March 31, 2026, we recognized a total charge of approximately $0.4 million reflecting the estimated cost to remediate the affected units of our RhodoLED XL Lamps in response to the ITC Matter. The total charge comprises (i) an inventory write-down of approximately $0.1 million to reduce the carrying value of affected finished goods inventory and obsolete components in raw materials to net realizable value in accordance with ASC 330-10-35, and (ii) an accrued remediation liability of approximately $0.4 million for the future cost activities required to complete the remediation. We exclude these charges because they relate to a discrete adverse legal and regulatory matter that is not indicative of the Company’s ongoing operating performance.
Current report
Adjusted EBITDA increased from ($4.4) million for the three months ended March 31, 2025 to ($3.6) million for the three months ended March 31, 2026, an improvement of approximately $0.8 million. The improvement was primarily driven by a $2.7 million increase in gross profit, reflecting higher Ameluz unit volume and a significantly lower cost structure as described above. This improvement was partially offset by a $2.3 million increase in selling, general and administrative expenses. Refer to the section above entitled “Selling, General and Administrative Expenses” for additional details.
Current report
During the three months ended March 31, 2026, operating activities used $0.1 million of cash, primarily resulting from our loss from operations of $4.3 million, offset by changes in our operating assets and liabilities of $3.4 million. The net decrease in operating accounts was attributable to the decrease in accounts receivable reflective of the seasonal sales of PDT procedures, with higher sales in the fourth quarter, and collection in the first quarter of receivables outstanding at year-end.
Current report
Loss Contingency for ITC Matter
Current report
With respect to the ITC Matter, our estimate of the loss is based on a bottoms-up cost model encompassing component procurement, field service travel and labor, return-to-base rework, regulatory and quality activities, and other costs. The estimate is sensitive to a number of assumptions that may change as remediation activities progress, including, in particular, (a) the labor and the associated travel and lodging costs, (b) the unit cost of the remediation and the foreign exchange rate at which it is procured, (c) the regulatory pathway determined for the remediation and (d) the timing and outcome of the suspended limited exclusion order and cease and desist order as to the ‘028 patent. A change in any of these assumptions could result in a material change in the recorded accrual, which would be recognized prospectively as a change in estimate in accordance with ASC 250-10-45-17.
Removed paragraphs (64)
Previous report
Prior to the closing of the Strategic Transaction on October 20, 2025, we were selling Ameluz®in the United States under an exclusive license and supply agreement, the Second Amended and Restated License and Supply Agreement, effective as of February 13, 2024 with the Ameluz Licensor (the “Second A&R Ameluz LSA”). The Second A&R Ameluz LSA reduced the price we pay per unit, based on certain percentages of the anticipated net selling price (“Transfer Price”) of Ameluz®from 50% to 25% which covers the cost of goods, royalties on sales, and services including all regulatory efforts, agency fees, pharmacovigilance and patent administration for all purchases in 2024 and 2025.
Previous report
Effective June 1, 2024, we assumed control of all clinical trials relating to Ameluz®in the United States, allowing for more effective cost management and direct oversight of trial efficiency. Our research and development (“R&D”) program is focused on label expansion for Ameluz® as well as supporting PDT growth by improving the capabilities of our RhodoLED® Lamps to better fulfill the needs of dermatologists. The reduced Transfer Price is expected to allow the Company to finance such R&D activities and continue our commercial growth trajectory.
Previous report
Strategic Transaction with Biofrontera AG
Previous report
On June 30, 2025, the Company signed a binding agreement (the “Term Sheet”) with its former parent company Biofrontera AG and its subsidiaries, Biofrontera Pharma and Biofrontera Bioscience (together, the “Biofrontera Group”) pursuant to which the Company agreed to acquire all rights in the United States (the “U.S. Rights”) to Ameluz® and RhodoLED® (the “Strategic Transaction”). In connection with the Strategic Transaction, additional agreements were executed, and the transfer of the U.S. Rights was completed on October 20, 2025. As a result of these actions, the Company will pay a monthly earnout of 12% in years where Ameluz®revenue in the United States is at or below $65.0 million and 15% in years where Ameluz® revenue in the United States exceeds $65.0 million. The earnout replaces the transfer pricing model under the Company’s Second A&R Ameluz LSA effective as of February 13, 2024 by and among the Company, and the Biofrontera Group. The new structure reduces overall cost for the Company and is expected to accelerate the Company’s timeframe to reach break-even.
Previous report
With the completion of this agreement, the Company now assumes full responsibility for manufacturing, regulatory, quality management, pharmacovigilance, and commercialization of Ameluz® and the RhodoLED® portfolio in the U.S. The Company expects the full transfer of assets and personnel to be completed by late fourth quarter of 2025 or early in the first quarter of 2026.
Previous report
In exchange for the U.S. Rights, in addition to the aforementioned earnout and an agreement to transfer all costs associated with the U.S. business, Biofrontera AG received 3,019 shares of Series D Convertible Preferred Stock, par value $0.001 per share (the “Series D Preferred Stock”).
Previous report
The transaction was funded through an $11 million investment by existing investors, $8.5 million of which was funded at the time the Term Sheet was executed and the remaining $2.5 million was funded on October 24, 2025 following the closing of the Strategic Transaction.
Previous report
Xepi*- Closing of Asset Purchase Agreement*
Previous report
On November 6, 2025 (the “Closing Date”), the Company entered into an Asset Purchase Agreement (the “APA”) with Pelthos Therapeutics Inc., an unaffiliated party, providing for the sale of all of the assets relating to the Company’s product, Xepi® (ozenoxacin) cream.
Previous report
The purchase price for the acquired assets is a maximum of $10.0 million, payable as follows:
Previous report
Compliance with Nasdaq Listing Standards
Previous report
As described further below, on each of November 4, 2025 and November 6, 2025, the Company received a notice (the “November 4 Notice” and the “November 6 Notice,” respectively) from Nasdaq notifying the Company that it has regained compliance with the continued listing requirements under Nasdaq Listing Rule 5550(b)(1) and Nasdaq Listing Rule 5550(a)(2).
Previous report
Nasdaq Listing Rule 5550(b)(2)
Previous report
On May 8, 2025, the Company received a letter from Nasdaq notifying the Company that the listing of the Common Stock was not in compliance with Nasdaq Listing Rule 5550(a)(2) as the closing bid price of the Common Stock was less than $1.00 per share for the previous 33 consecutive business days.
Previous report
The notice had no present impact on the listing or trading of the Company’s securities on Nasdaq. Under Nasdaq Listing Rule 5810(c)(3)(A), the Company had a period of 180 calendar days, or until November 5, 2025, to regain compliance with the rule referred to in this paragraph.
Previous report
In the November 6 Notice, Nasdaq notified the Company that, because the closing bid price of the Company’s common stock was $1.00 per share or greater for the preceding 11 consecutive business days, the Company has regained compliance with Listing Rule 5550(a)(2), and that this matter is now closed.
Previous report
Nasdaq Listing Rule 5550(b)(1)
Previous report
On May 21, 2025, the Company received a notice from Nasdaq notifying the Company that, because the Company’s stockholders’ equity as reported in its Quarterly Report on Form 10-Q for the period ended March 31, 2025 was $0.5 million, the Company was no longer in compliance with the continued listing requirement under Nasdaq Listing Rule 5550(b)(1), which requires that a listed company’s stockholders’ equity be at least $2.5 million. Additionally, as of the date of the notice and as of September 30, 2025, the Company did not meet either of the alternative requirements of maintaining a market value of listed securities of $35 million or achieving a net income from continuing operations of $0.5 million in the most recently completed fiscal year or in two of the last three most recently completed fiscal years.
Previous report
As a result of the Strategic Transaction and the Subsequent Closing, as of October 24, 2025, the Company believes its stockholders’ equity exceeds $5 million which exceeds the minimum amount required for continued listing on Nasdaq under Nasdaq Listing Rule 5550(b)(1).
Previous report
In the November 4 Notice, Nasdaq notified the Company that, based on certain disclosures in the Current Report on Form 8-K filed by the Company on October 24, the Company is in compliance with the continued listing requirement under Nasdaq Listing Rule 5550(b)(1). Nasdaq will continue to monitor the Company’s ongoing compliance with the stockholders’ equity requirement and, if at the time of its next periodic report the Company does not evidence compliance, it may be subject to delisting.
Previous report
If, for any reason, Nasdaq should delist our common stock from trading on its exchange and we are unable to obtain listing on another reputable national securities exchange, a reduction in some or all of the following may occur, each of which could materially adversely affect our stockholders:
Previous report
In addition, if we fail to regain compliance to be eligible to trade on Nasdaq or obtain listing on another reputable national securities exchange, we may have to pursue trading on a less recognized or accepted market, such as the over the counter markets, our stock may be traded as a “penny stock” which would make transactions in our stock more difficult and cumbersome, and we may be unable to access capital on favorable terms or at all, as companies trading on alternative markets may be viewed as less attractive investments with higher associated risks, such that existing or prospective institutional investors may be less interested in, or prohibited from, investing in our common stock. This may also cause the market price of our common stock to further decline.
Previous report
Geopolitical Uncertainty and Tariffs
Previous report
Seasonality
Previous report
Our Strategy
Previous report
By executing these strategic objectives, we expect to fuel company growth, deepen our trusted relationships in the dermatology community, and above all, help patients live healthier, more fulfilling lives.
Previous report
Revenues, Related Party
Previous report
Prior to our taking over clinical trials on June 1, 2024, we generated insignificant related party revenue in connection with an agreement with Biofrontera Bioscience to provide RhodoLED®Lamps and associated services for the clinical trials performed by Biofrontera Bioscience. In the future, we do not expect to receive related party revenue regarding RhodoLED®Lamps and associated services for clinical trials.
Previous report
Our investments are comprised of equity securities in shares of Biofrontera AG, which are initially recorded at cost, plus transaction costs, and subsequently measured at fair value, based on quoted market prices, with the gains and losses reported in the Company’s consolidated statement of operations. For the investments held in foreign currencies, the change in fair value attributable to changes in foreign exchange rates is included in gains and losses in the consolidated statement of operations.
Previous report
Loss on Debt Extinguishment
Previous report
Effective January 4, 2024, we voluntarily terminated the Loan and Security Agreement with MidCap Business Credit LLC, for our revolving line of credit and recognized a $0.3 million loss on debt extinguishment upon the early termination related to prepayment fees and the write-off of deferred financing costs.
Previous report
Interest Expense, Net
Previous report
Product Revenue, net
Previous report
Net product revenue for the three months ended September 30, 2025 decreased by $2.0 million, or 22.5% as compared to the three months ended September 30, 2024. This decrease was primarily driven by a decrease in sales volume of Ameluz® in the third quarter of 2025. The lower sales volume of Ameluz® in the third quarter of 2025 as compared to the same period of 2024 was due to customer buy-in before the increase in the price of Ameluz® in October 2024.
Previous report
Cost of revenues, related party for the three months ended September 30, 2025 decreased by $2.9 million, or 60.0% as compared to the three months ended September 30, 2024. This was primarily due to the reduced cost structure under the Second A&R Ameluz LSA. See Note 11. Related Party Transactions.
Previous report
Selling, general and administrative expenses for the three months ended September 30, 2025 increased by $1.6 million, or 19.3% as compared to the three months ended September 30, 2024. The increase was primarily driven by increase in legal costs due to patent claims. SeeNote 15. Commitments and Contingencies – Legal Proceedings.
Previous report
Research and Development Expenses
Previous report
R&D expenses for the three months ended September 30, 2025 increased by $0.2 million, or 27.7% as compared to the three months ended September 30, 2024. The increase was attributable to higher external investigator fees and clinical site setup costs, reflecting the progress of trials in 2025.
Previous report
The following table summarizes our R&D expenses by indication:
Previous report
Interest expense, net
Showing the first 40 of 64 passages. Open the source sections for the rest.
Reworded paragraphs (32)
Previous wording
Management’s discussion and analysis (“MD&A”) provides supplemental information, which sets forth the major factors that have affected our financial condition and results of operations and should be read in conjunction with the Condensed Consolidated Financial Statements and related notes. The following information should provide a better understanding of the major factors and trends that affect our earnings performance and financial condition, and how our performance during the first three quarters of 2025 compare with prior-year periods. Throughout this section, Biofrontera Inc., including its wholly owned subsidiary, Biofrontera Discovery GmbH (“Discovery” or “subsidiary”), is referred to as “Company,” “we,” “us,” or “our.” References to “Licensors” refer collectively to Biofrontera Pharma, Biofrontera Bioscience and Ferrer. References to “*Ameluz Licensor”*refer collectively to Biofrontera Pharma and Biofrontera Bioscience.
Current wording
Management’s discussion and analysis (“MD&A”) provides supplemental information, which sets forth the major factors that have affected our financial condition and results of operations and should be read in conjunction with the Condensed Consolidated Financial Statements and related notes. The following information should provide a better understanding of the major factors and trends that affect our earnings performance and financial condition, and how our performance during the first quarter of 2026 compares with prior-year periods. Throughout this section, Biofrontera Inc., including its wholly owned subsidiary, Biofrontera Discovery GmbH (“Discovery” or “subsidiary”), is referred to as “Company,” “we,” “us,” or “our.” References to*“*Former Ameluz Licensor” refers to Biofrontera Pharma GmbH and references to the “Biofrontera Group” refer to Biofrontera AG and its consolidated subsidiaries.
Previous wording
More detailed information about us and the risk factors that may affect the realization of forward-looking statements, including the forward-looking statements in this Quarterly Report on Form 10-Q, is set forth in our filings with the SEC, including our Form 10-K. We urge investors and security holders to read those documents free of charge at the SEC’s web site at www.sec.gov. We do not undertake to publicly update or revise our forward-looking statements as a result of new information, future events or otherwise, except as required by law.
Current wording
More detailed information about us and the risk factors that may affect the realization of forward-looking statements, including the forward-looking statements in this Quarterly Report on Form 10-Q, is set forth in our filings with the Securities and Exchange Commission (“SEC”), including the 2025 Form 10-K. We urge investors and security holders to read those documents free of charge at the SEC’s web site at www.sec.gov. We do not undertake to publicly update or revise our forward-looking statements as a result of new information, future events or otherwise, except as required by law.
Previous wording
Biofrontera Inc. (the “Company” or “Biofrontera”) is a United States based biopharmaceutical company commercializing a portfolio of pharmaceutical products for the treatment of dermatological conditions with a focus on photodynamic therapy (“PDT”). The Company’s primary licensed products, which include Ameluz® as well as the BF-RhodoLED®and RhodoLED®XL lamps (the “RhodoLED®Lamps”), are used for the treatment of actinic keratoses, which are pre-cancerous skin lesions. With our national commercial team, we generate revenue by selling our licensed products directly to dermatology offices and groups.
Current wording
Biofrontera Inc. is a United States based biopharmaceutical company engaging in the development, manufacturing, and commercialization of pharmaceutical products for the treatment of dermatological conditions with a focus on photodynamic therapy (“PDT”). The Company’s products, which include Ameluz as well as the BF-RhodoLED and RhodoLED XL lamp series (together, the “RhodoLED Lamps”), are used for the treatment of actinic keratosis (“AK”), a common skin condition characterized by the growth of pre-cancerous skin lesions (“AKs”). We generate revenue by selling our products, through our national commercial team, directly to dermatology offices and groups in the United States.
Previous wording
Recent actions by the U.S., including the imposition of significant tariffs on imports from certain countries, have heightened uncertainty in the global trade environment. These tariffs, along with potential retaliatory measures by other countries, may increase inflationary pressure and raise the costs of our products, which are exclusively imported from Europe. While several tariff announcements have been followed by announcements of limited exemptions and temporary pauses, these actions have caused substantial uncertainty and volatility in financial markets, and may result in further retaliatory measures. We may be unable to fully offset the impacts of tariffs by adjusting the pricing of our products.
Current wording
*Geopolitical Uncertainty and Tariffs.*Recent actions by the U.S., including the imposition of significant tariffs on imports from certain countries, have heightened uncertainty in the global trade environment. These tariffs, along with potential retaliatory measures by other countries, may increase inflationary pressure and raise the costs of our products, which are exclusively imported from Europe. While several tariff announcements have been followed by announcements of limited exemptions and temporary pauses, these actions have caused substantial uncertainty and volatility in financial markets, and may result in further retaliatory measures. We may be unable to fully offset the impacts of tariffs by adjusting the pricing of our products. We continue to monitor developments and assess the potential impact on our supply chain, product cost, and pricing strategy.
Previous wording
Our principal objective is to improve patient outcomes through adoption and use of our licensed products in the United States. The key elements of our strategy include the following:
Current wording
Our principal objective is to improve patient outcomes through adoption and use of our products in the United States. The key elements of our strategy include the following:
Previous wording
We devote a substantial portion of our cash resources to the commercialization of our licensed products, Ameluz® and the BF-RhodoLED®Lamps. We have financed our operating and capital expenditures through cash proceeds generated from our product sales, short-term debt and proceeds received from convertible notes and equity financings.
Current wording
We devote a substantial portion of our cash resources to the commercialization of Ameluz and the BF-RhodoLED Lamps. We have financed our operating and capital expenditures through cash proceeds generated from our product sales, proceeds received from convertible notes and equity financings.
Previous wording
We believe that important measures of our results of operations include product revenue, operating income (loss) and adjusted EBITDA (a non-U.S. GAAP measure as defined below). Our sole source of product revenue is sales of products that we license from certain related and unrelated companies. Our long-term financial objectives include consistent revenue growth and expanding operating margins. Accordingly, we are focused on licensed product sales expansion to drive revenue growth and improve operating efficiencies, including effective resource utilization, information technology leverage, and overhead cost management.
Current wording
We believe that important measures of our results of operations include product revenue, operating income (loss) and adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”; a non GAAP measure). Our sole source of product revenue is sales of Ameluz and the BF-RhodoLED Lamps. Our long-term financial objectives include consistent revenue growth and expanding operating margins. Accordingly, we are focused on product sales expansion to drive revenue growth and improve operating efficiencies, including effective resource utilization, information technology leverage, and overhead cost management.
Previous wording
Traditional photodynamic therapy treatments using a lamp are performed more frequently during the winter, as a result our revenue is subject to some seasonality and has historically been higher during the first and fourth quarters than during the second and third quarters.
Current wording
Because traditional photodynamic therapy treatments using a lamp are performed more frequently during the winter, our revenue is subject to some seasonality and has historically been higher during the first and fourth quarters than during the second and third quarters. As a result, our historical results of operations may not be comparable to our results of operations in future periods, and our results of operations may not be directly comparable from period to period.
Previous wording
We generate product revenues through the third-party sales of our licensed products, Ameluz® and RhodoLED® Lamps*.*Revenues from product sales are recorded net of trade discounts and allowances and government rebates.
Current wording
We generate product revenues through the sale of our products Ameluz and RhodoLED Lamps*.*Revenues from product sales are recorded net of trade discounts and allowances and government rebates.
Previous wording
The primary factors that determine our revenue derived from our licensed products are:
Current wording
The primary factors that determine our revenue derived from our products are:
Previous wording
Cost of revenues, related party, is comprised of purchase costs of our licensed products, Ameluz® and RhodoLED®Lamps from Biofrontera Pharma GmbH and insignificant inventory adjustments due to scrapped, expiring and excess products.
Current wording
Cost of revenues, related party, relating to inventory purchased before the Strategic Transaction, is comprised of purchase costs of our products, Ameluz and RhodoLED Lamps, from Biofrontera Pharma GmbH and insignificant inventory adjustments due to scrapped, expiring and excess products.
Previous wording
Selling, general and administrative expenses consist principally of costs associated with our sales force, commercial support personnel, personnel in executive and other administrative functions, and medical affairs professionals. Other selling, general and administrative expenses include marketing, trade, and other commercial costs necessary to support the commercial operation of our licensed products and professional fees for legal, consulting and accounting services. Selling, general and administrative expenses also include the amortization of our intangible assets and our legal settlement expenses.
Current wording
Selling, general and administrative expenses consist principally of costs associated with our sales force, commercial support personnel, personnel in executive and other administrative functions, as well as medical affairs professionals. Other selling, general and administrative expenses include marketing, trade, and other commercial costs necessary to support the commercial and manufacturing operation of our products and professional fees for legal, consulting and accounting services, product regulation, quality management, as well as depreciation and amortization.
Previous wording
Selling, general and administrative expenses, related party, relate to the services provided by Biofrontera AG, primarily for regulatory support and pharmacovigilance . These expenses are charged to us based on costs incurred plus 6% in accordance with the Amended and Restated Master Contact Services Agreement entered into in December 2021 (the “2021 Services Agreement”). The 2021 Services Agreement enables us to continue relying on Biofrontera AG and its subsidiaries for various services it has historically provided to us, including regulatory and pharmacovigilance support for as long as we deem necessary. We currently have statements of work in place regarding regulatory affairs, medical affairs, and pharmacovigilance, and are continuously assessing the other services historically provided to us by Biofrontera AG to determine (i) if they will be needed, and (ii) whether they can or should be obtained from other third-party providers.
Current wording
Selling, general and administrative expenses, related party, relate to the services provided by the Biofrontera Group, primarily for regulatory support and pharmacovigilance. These expenses were charged to us based on costs incurred plus 6% in accordance with the Amended and Restated Master Contact Services Agreement entered into in December 2021.
Previous wording
Our R&D expenses include costs directly attributable to the clinical development of Ameluz®, including personnel-related expenses, the cost of services provided by outside contractors, including services related to the Company’s clinical trials, facilities, depreciation, and other direct and allocated expenses. Along with our Ameluz®clinical trials, our R&D program also aims to improve the capabilities of our RhodoLED® Lamps to better fulfill the needs of dermatologists and improve the effectiveness of our commercial team by letting sales representatives carry approved devices with them, allowing for easier product demonstrations and evaluations. All costs associated with research and development are expensed as incurred.
Current wording
Effective June 1, 2024, we took control of all clinical trials for Ameluz in the United States, allowing for more effective cost management and direct oversight of trial efficiency. Our R&D expenses include costs directly attributable to the clinical development of Ameluz, including personnel-related expenses, the cost of services provided by outside contractors, including services related to the Company’s clinical trial sites, facilities, depreciation, and other direct and allocated expenses. Along with our Ameluz clinical trials, our R&D program also aims to improve the capabilities of our RhodoLED Lamps to better fulfill the needs of dermatologists and improve the effectiveness of our commercial team by letting sales representatives carry approved devices with them, allowing for easier product demonstrations and evaluations. All costs associated with R&D are expensed as incurred.
Previous wording
Change in Fair Value of Investment, Related Party
Current wording
Change in Fair Value of Warrant Liabilities
Previous wording
Other income (expense), net primarily includes (i) gain (loss) on return of leased assets and (ii) gain (loss) on foreign currency transactions.
Current wording
Other income (expense), net primarily includes (i) gain on return of leased assets and (ii) gain (loss) on foreign currency transactions.
Previous wording
The following table summarizes our results of operations for the three months ended September 30:
Current wording
The following table summarizes our results of operations for the three months ended March 31, 2026 and 2025:
Previous wording
The change in fair value of warrant liabilities was $0.3 million for the three months ended September 30, 2025, as compared to $0.7 million for the three months ended September 30, 2024. The change in fair value of warrant liabilities was driven primarily by a drop in the underlying value of the Company’s Common Stock during the third quarter of 2025 as compared to the third quarter of 2024.
Current wording
The change in fair value of warrant liabilities was ($0.2) million for three months ended March 31, 2026, as compared to $0.5 million for the three months ended March 31, 2025. The increase in the fair value of warrant liabilities for the three months ended March 31, 2026 was driven primarily by an increase in the underlying value of the Company’s common stock while the decrease for the three months ended March 31, 2025 was driven by a decrease in the underlying value of the Company’s common stock.
Previous wording
Net Loss to Adjusted EBITDA Reconciliation for the Three and Nine Months Ended September 30, 2025 and 2024
Current wording
Net Loss to Adjusted EBITDA Reconciliation for the Three Months Ended March 31, 2026 and 2025
Previous wording
We define adjusted EBITDA as net income or loss before interest income and expense, income taxes, depreciation and amortization, and other non-operating items from our statements of operations as well as certain other items considered outside the normal course of our operations specifically described below. Adjusted EBITDA is not a presentation made in accordance with U.S. GAAP. Our definition of adjusted EBITDA may vary from the use of similarly titled measures by others in our industry due to the potential inconsistencies in the method of calculation and differences due to items subject to interpretation. Adjusted EBITDA should not be considered as an alternative to net income or loss, operating income/(loss), cash flows from operating activities or any other performance measures derived in accordance with U.S. GAAP as measures of operating performance or liquidity. Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of our results as reported under U.S. GAAP.
Current wording
We define adjusted EBITDA as net income or loss before interest income and expense, income taxes, depreciation and amortization, and other non-operating items from our statements of operations as well as certain other items considered outside the normal course of our operations specifically described below. Adjusted EBITDA is not a presentation made in accordance with GAAP. Our definition of adjusted EBITDA may vary from the use of similarly-titled measures by others in our industry due to the potential inconsistencies in the method of calculation and differences due to items subject to interpretation. Adjusted EBITDA should not be considered as an alternative to net income or loss, operating income/(loss), cash flows from operating activities or any other performance measures derived in accordance with GAAP as measures of operating performance or liquidity. Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP.
Previous wording
Change in fair value of warrant liabilities: The warrants issued in conjunction with our private placement offerings and registered public offerings are accounted for as liabilities in accordance with ASC 815-40. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within the consolidated statement of operations. We exclude the impact of the change in fair value of warrant liabilities as this is non-cash.
Current wording
Change in fair value of warrant liabilities: The warrants issued in conjunction with our private placement offerings and registered public offerings were accounted for as liabilities in accordance with ASC 815-40. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within the consolidated statement of operations. We exclude the impact of the change in fair value of warrant liabilities as this is non-cash.
Previous wording
We use adjusted EBITDA to measure our performance from period to period and to compare our results to those of our competitors. In addition to adjusted EBITDA being a significant measure of performance for management purposes, we also believe that this presentation provides useful information to investors regarding financial and business trends related to our results of operations and that when non-U.S. GAAP financial information is viewed with U.S. GAAP financial information, investors are provided with a more meaningful understanding of our ongoing operating performance.
Current wording
We use adjusted EBITDA to measure our performance from period to period and to compare our results to those of our competitors. In addition to adjusted EBITDA being a significant measure of performance for management purposes, we also believe that this presentation provides useful information to investors regarding financial and business trends related to our results of operations and that when non GAAP financial information is viewed with GAAP financial information, investors are provided with a more meaningful understanding of our ongoing operating performance.
Previous wording
The below table presents a reconciliation from net loss to Adjusted EBITDA for the three and nine months ended September 30, 2025 and 2024:
Current wording
The below table presents a reconciliation from net loss to Adjusted EBITDA for the three months ended March 31, 2026 and 2025:
Previous wording
Since we commenced operations in 2015, we have generated significant losses. The Company incurred net cash outflows from operations of $11.0 million and $9.3 million for the nine months ended September 30, 2025 and 2024, respectively. The Company had an accumulated deficit as of September 30, 2025 of $133.6 million. The Company’s primary sources of liquidity are its cash collected from the sales of its products, and cash flows from financing transactions, including $11.0 million received in a private placement of Series C Preferred Stock, (received in two separate tranches of $8.5 million in July 2025 and $2.5 million in October 2025).) As of September 30, 2025, we had cash and cash equivalents of $3.4 million, compared to $5.9 million as of December 31, 2024. These factors raise substantial doubt about the Company’s ability to continue as a going concern for a period of at least twelve months from the issuance date of this report.
Current wording
The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. Since we commenced operations in 2015, we have generated significant losses. The Company incurred net cash outflows from operations of $0.1 million and $4.1 million for the three months ended March 31, 2026 and 2025, respectively. As of March 31, 2026, the Company’s accumulated deficit was $133 million. The Company’s primary sources of liquidity are its cash collected from the sales of its products and cash flows from financing transactions. As of March 31, 2026, we had cash and cash equivalents of $6.3 million, compared to $6.4 million as of December 31, 2025. The Company cannot provide assurance that it will ultimately achieve profitable operations and become operating cash flow positive or raise additional debt or equity capital. Additionally, the current capital resources are not adequate to continue operating and maintaining the business strategy for a period of twelve months from the issuance date of this report. Management believes that these conditions raise substantial doubt about the Company’s ability to continue as a going concern for at least twelve months from the issuance date of this Quarterly Report on Form 10-Q.
Previous wording
The Company plans to address the conditions that raise substantial doubt regarding its ability to continue as a going concern by, among other things, utilizing external financing options, including a short-term line of credit, as well as finalizing the sale of its Xepi product line on November 6, 2025. However, there can be no assurance that the Company will be successful in obtaining sufficient funding on acceptable terms, if at all. If the Company is unable to raise additional capital when needed, it will not have sufficient cash resources and liquidity to fund its business operations and may be forced to delay or reduce continued commercialization efforts or R&D programs which could have a material adverse effect on the Company and its financial statements.
Current wording
The Company plans to address the conditions that raise substantial doubt regarding its ability to continue as a going concern by, among other things, continuing to expand the commercialization of Ameluz in the United States while controlling expenses, pursuing the realization of an additional $1.0 million in milestone payments from the sale of the Xepi intangible asset and, if necessary, securing additional capital through equity or debt financings. However, there can be no assurance that the Company will be successful in obtaining sufficient funding on acceptable terms, if at all. If the Company is unable to raise additional capital when needed, it will not have sufficient cash resources and liquidity to fund its business operations and may be forced to delay or reduce continued commercialization efforts or R&D programs which could have a material adverse effect on the Company and its financial statements.
Previous wording
The consolidated financial statements do not include any adjustments to the carrying amounts and classification of assets, liabilities, and reported expenses that may be necessary if the Company were unable to continue as a going concern.
Current wording
The condensed consolidated financial statements do not include any adjustments to the carrying amounts and classification of assets, liabilities, and reported expenses that may be necessary if the Company were unable to continue as a going concern.
Previous wording
During the nine months ended September 30, 2025, operating activities used $11.0 million of cash, primarily resulting from our loss from operations of $16.2 million, adjusted for non-cash expense of stock-based compensation of $0.7 million, depreciation and amortization in the aggregate of $0.6 million, non-cash interest expense of $0.4 million, and net cash used by changes in our operating assets and liabilities of $4.0 million, partially offset by the change in fair value of warrant liabilities of $0.4 million.
Current wording
During the three months ended March 31, 2025, operating activities used $4.1 million of cash, primarily resulting from our loss from operations of $4.2 million, plus the change in fair value of warrant liabilities of $0.5 million adjusted for non-cash expense of stock-based compensation of $0.2 million, non-cash interest expense of $0.1 million, depreciation and amortization in the aggregate of $0.2 million, and net cash used by changes in our operating assets and liabilities of $0.1 million.
Previous wording
During the nine months ended September 30, 2025, net cash used in investing activities consisted of negligible fixed asset purchases.
Current wording
During the three months ended March 31, 2026 and 2025, net cash used in investing activities consisted of negligible fixed asset purchases.
Previous wording
Our management’s discussion and analysis of our financial condition and results of operations are based on our financial statements, which have been prepared in accordance with generally accepted accounting principles of U.S. GAAP. The preparation of the financial statements in accordance with U.S. GAAP requires the use of estimates and assumptions by management that affect the value of assets and liabilities, as well as contingent assets and liabilities, as reported on the balance sheet date, and revenues and expenses arising during the reporting period. The main areas in which assumptions, estimates and the exercising of a degree of judgment are appropriate relate to fair value measurements, valuation of intangible assets and impairment assessment, and stock compensation. Estimates are based on historical experience and other assumptions that are considered appropriate in the circumstances. They are continuously reviewed but may vary from the actual values.
Current wording
Our management’s discussion and analysis of our financial condition and results of operations are based on our financial statements, which have been prepared in accordance with generally accepted accounting principles of the United States, or GAAP. The preparation of the financial statements in accordance with GAAP requires the use of estimates and assumptions by management that affect the value of assets and liabilities, as well as contingent assets and liabilities, as reported on the balance sheet date, and revenues and expenses arising during the reporting period. The main areas in which assumptions, estimates and the exercising of a degree of judgment are appropriate relate to contingent consideration, fair value measurements, valuation of intangible assets and impairment assessment, and stock compensation. Estimates are based on historical experience and other assumptions that are considered appropriate in the circumstances. They are continuously reviewed but may vary from the actual values.
Previous wording
Our significant accounting policies are described in more detail inNote 2 – Summary of Significant Accounting Policies, to our consolidated financial statements included inItem 8. Financial Statements and Supplementary Data in our Form 10-K.
Current wording
Our significant accounting policies are described in more detail inNote 2. Summary of Significant Accounting Policies, to our consolidated financial statements included inItem 8. Financial Statements and Supplementary Data in the 2025 Form 10-K.
Previous wording
A summary of our critical accounting estimates is discussed in the section entitled “Critical Accounting Estimates” inItem 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Form 10-K. There were no material changes to our critical accounting estimates for the nine months ended September 30, 2025.
Current wording
A summary of our critical accounting estimates is discussed in the section entitled “Critical Accounting Estimates” inItem 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations inthe 2025 Form 10-K. There were no material changes to our critical accounting estimates for the three months ended March 31, 2026, other than as noted below.
Previous wording
Other than those items reflected inNote 18. Commitments and Contingencies we did not have during the periods presented, and we do not currently have, any other off-balance sheet arrangements, as defined in the rules and regulations of the SEC.
Current wording
Other than those items reflected inNote 16. Commitments and Contingencies we did not have during the periods presented, and we do not currently have, any other off-balance sheet arrangements, as defined in the rules and regulations of the SEC.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Change in Fair Value of Warrant Liabilities
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Our historical results of operations may not be comparable to our results of operations in future periods, and our results of operations may not be directly comparable from period to period due to seasonality.
Previous report — wording carried elsewhere
During the nine months ended September 30, 2024, operating activities used $9.3 million of cash, primarily resulting from our loss from operations of $16.4 million, adjusted for non-cash expense of stock-based compensation of $0.7 million, non-cash interest expense of $0.2 million, loss on debt extinguishment of $0.3 million, depreciation and amortization in the aggregate of $0.9 million, and net cash used by changes in our operating assets and liabilities of $6.1 million, offset by the change in fair value of warrant liabilities of $1.3 million