SWK Holdings Corp
For the period ended Sep 30, 2025. Filed Nov 6, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 6, 2025
SWKHL$25.21+0.1%Stored close · as of Nov 2, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-14.
0001628280-25-040420
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-06.
0001628280-25-050155
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 60 previous paragraphs and 68 current paragraphs.
36 unchanged; 18 reworded; 14 added; 5 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 9 previous and 9 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 (14)
Current report
Recent Developments
Current report
Agreement and Plan of Merger
Current report
On October 9, 2025, the Company, entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Runway Growth Finance Corp., a Maryland corporation (“Parent”), RWAY Portfolio Holding Corp., a Delaware corporation and a direct wholly owned subsidiary of Parent (“Intermediary Sub”), RWAY Portfolio Corp., a Delaware corporation and a direct wholly owned subsidiary of Intermediary Sub (“Acquisition Sub”), and Runway Growth Capital LLC, a Delaware limited liability company (“Parent External Adviser”).
Current report
The Merger Agreement provides that, among other things and on the terms and subject to the conditions of the Merger Agreement, (i) Acquisition Sub will merge with and into the Company, with the Company continuing as the surviving corporation and as a wholly owned subsidiary of Intermediary Sub (the “Surviving Corporation”), or, in the alternative, the Company will merge with and into Acquisition Sub, with Acquisition Sub continuing as the surviving corporation and as a wholly owned subsidiary of Intermediary Sub (in either case, the “First Merger”), (ii) immediately after the First Merger, the Surviving Corporation will merge with and into Intermediary Sub (the “Second Merger”), with Intermediary Sub surviving the Second Merger as a wholly owned subsidiary of Parent, and (iii) immediately after the Second Merger, Intermediary Sub will merge with and into Parent (the “Third Merger” and, together with the Second Merger and the First Merger, the “Mergers”), with Parent continuing as the surviving corporation in the Third Merger.
Current report
The foregoing summary description of the Merger Agreement, the Mergers and the other transactions contemplated thereby is subject to and qualified in its entirety by reference to the Merger Agreement, a copy of which is attached hereto as Exhibit 2.01, and the terms of which are incorporated herein by reference.
Current report
Key Stockholder Agreement
Current report
Concurrently with the execution and delivery of the Merger Agreement, and as a condition and inducement to Parent’s willingness to enter into the Merger Agreement, Double Black Diamond Offshore Ltd. (the “Key Stockholder”), a stockholder of the Company, has entered into a key stockholder agreement with Parent (the “Key Stockholder Agreement”) pursuant to which the Key Stockholder has, subject to the terms and conditions thereof, agreed, among other things, to vote its shares of Company Common Stock in favor of the adoption of the Merger Agreement and the approval of the transactions contemplated thereunder, including the First Merger. As of October 9, 2025, the Key Stockholder held approximately 69.9% of the voting power of the Company Common Stock.
Current report
The foregoing summary description of the Key Stockholder Agreement is subject to and qualified in its entirety by reference to the Key Stockholder Agreement, a copy of which is attached hereto as Exhibit 2.02 and the terms of which are incorporated herein by reference.
Current report
Pharmaceutical manufacturing, research and development expense decreased for the three months ended September 30, 2025 as compared to the same period in the previous year as a result of the MOD3 asset sale.
Current report
The $0.2 million decrease in depreciation and amortization expense for the three months ended September 30, 2025 primarily due to the suspension of depreciation and amortization on assets held for sale and the subsequent sale of those assets.
Current report
Other income (expense), net increased to an income of $4.0 million for the three months ended September 30, 2025 from income of $0.3 million for the three months ended September 30, 2024. The $3.7 million increase primarily relates to the gain on fair value of adjustments of warrants and gain on sale of the MOD3 assets.
Current report
Income tax expense increased for the three months ended September 30, 2025 as compared to the same period in the previous year as a result of the change in the provision for credit losses.
Current report
Provision (Benefit) for Credit Losses
Current report
Pharmaceutical manufacturing, research and development expense remained consistent for the nine months ended September 30, 2025 as compared to the same period in the prior year.
Removed paragraphs (5)
Previous report
Provision for Credit Losses
Previous report
Pharmaceutical manufacturing, research and development expense remained consistent for the three months ended June 30, 2025 as compared to the same period in the previous year resulting in an immaterial change in total expense.
Previous report
Other income (expense), net decreased to an expense of $0.1 million for the three months ended June 30, 2025 from other income of $3.8 million for the three months ended June 30, 2024. The $3.9 million decrease primarily relates to the gain on revaluation of finance receivables and gain on exercise of warrants in the same period the prior year.
Previous report
Income tax expense remained consistent for the three months ended June 30, 2025 as compared to the same period in the previous year resulting in an immaterial change in total expense.
Previous report
Pharmaceutical manufacturing, research and development expense increased from $1.1 million for the six months ended June 30, 2024 to $1.4 million for the six months ended June 30, 2025. The $0.3 million increase was primarily due to increased compensation costs due to additional headcount during the period.
Reworded paragraphs (18)
Previous wording
The table below provides an overview of our outstanding finance receivables transactions as of and for the three and six months ended June 30, 2025(in thousands, except rate, share and per share data):
Current wording
The table below provides an overview of our outstanding finance receivables transactions as of and for the three and nine months ended September 30, 2025(in thousands, except rate, share and per share data):
Previous wording
Our critical accounting policies and estimates are described in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report. We believe there have been no new critical accounting policies or material changes to our existing critical accounting policies and estimates during the six months ended June 30, 2025, compared to those discussed in our Annual Report.
Current wording
Our critical accounting policies and estimates are described in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report. We believe there have been no new critical accounting policies or material changes to our existing critical accounting policies and estimates during the nine months ended September 30, 2025, compared to those discussed in our Annual Report.
Previous wording
Revenues decreased to $10.1 million for the three months ended June 30, 2025 from $10.8 million for the three months ended June 30, 2024. The $0.7 million decrease in revenue for the three months ended June 30, 2025 was primarily due to a $1.2 million decrease in Finance Receivables segment revenue and a $0.5 million increase in Pharmaceutical Development segment revenue. The finance receivables segment revenue decreased primarily due to the sale of the majority of the Company's royalty portfolio. The increase in pharmaceutical development revenues was due to the collaboration agreement with Aptar.
Current wording
Revenues increased to $10.9 million for the three months ended September 30, 2025 from $10.4 million for the three months ended September 30, 2024. The $0.5 million increase in revenue for the three months ended September 30, 2025 was primarily due to a $1.1 million increase in Finance Receivables segment revenue. The finance receivables segment revenue increased primarily due to the acceleration of exit fees earned on early payoff of the loan with Elutia, Inc.
Previous wording
Our provision for credit losses is established through charges or credits to income in the form of the provision in order to bring our allowance for credit losses for loans and unfunded commitments to a level deemed appropriate by management. We recognized a net provision for credit losses of $0.8 million and $4.1 million during the three months ended June 30, 2025 and 2024, respectively. The decrease is primarily due to impairments totaling $4.3 million during the same period in the prior year.
Current wording
Our provision for credit losses is established through charges or credits to income in the form of the provision in order to bring our allowance for credit losses for loans and unfunded commitments to a level deemed appropriate by management. We recognized a net benefit for credit losses of $0.9 million and a provision for credit losses of $1.4 million during the three months ended September 30, 2025 and 2024, respectively. The change is primarily due to the release of CECL reserves related to the early payoff of the loan with Elutia, Inc.
Previous wording
General and administrative expenses consist primarily of compensation; stock-based compensation and related costs for management, staff and Board; legal and audit expenses; and corporate governance expenses. General and administrative expenses remained consistent for the three months ended June 30, 2025 as compared to 2024.
Current wording
General and administrative expenses consist primarily of compensation; stock-based compensation and related costs for management, staff and Board; legal and audit expenses; and corporate governance expenses. General and administrative expenses increased for the three months ended September 30, 2025 as compared to 2024, primarily due to increased legal fees partially offset by a reduction in compensation costs as a result of the MOD3 asset sale.
Previous wording
Comparison of the six months ended June 30, 2025 and 2024(in millions)
Current wording
Comparison of the nine months ended September 30, 2025 and 2024(in millions)
Previous wording
Revenues decreased to $21.9 million for the six months ended June 30, 2025 from $22.2 million for the six months ended June 30, 2024. The $0.3 million decrease in revenue for the six months ended June 30, 2025 consisted of a $1.5 million decrease in Finance Receivables segment revenue offset by a $1.2 million increase in Pharmaceutical Development segment revenue. The $1.5 million decrease in Finance Receivables segment revenue was primarily due to a decrease in interest, fees and royalties earned on finance receivables that were paid off or sold during the period. The increase in the Pharmaceutical Development segment was primarily due to the Aptar collaboration agreement.
Current wording
Revenues increased to $32.8 million for the nine months ended September 30, 2025 from $32.6 million for the nine months ended September 30, 2024. The $0.2 million increase in revenue for the nine months ended September 30, 2025 consisted of a $0.4 million decrease in Finance Receivables segment revenue offset by a $0.6 million increase in Pharmaceutical Development segment revenue. The $0.4 million decrease in Finance Receivables segment revenue was primarily due to a decrease in interest, fees and royalties earned on finance receivables that were paid off or sold during the period. The increase in the Pharmaceutical Development segment was primarily due to the Aptar collaboration agreement.
Previous wording
Our provision for credit losses is established through charges or credits to income in the form of the provision in order to bring our allowance for credit losses for loans and unfunded commitments to a level deemed appropriate by management. We recognized a net benefit for credit losses of $0.7 million during the six months ended June 30, 2025 and a $9.4 million provision during the six months ended June 30, 2024. The decrease was primarily due to impairments included within the provision for credit losses during the six months ended June 30, 2024. See Note 3 to the unaudited condensed consolidated financial statements for further information on the allowance for credit losses.
Current wording
Our provision for credit losses is established through charges or credits to income in the form of the provision in order to bring our allowance for credit losses for loans and unfunded commitments to a level deemed appropriate by management. We recognized a net benefit for credit losses of $1.6 million during the nine months ended September 30, 2025 and a provision of $10.8 million during the nine months ended September 30, 2024. The decrease was primarily due to impairments included within the provision for credit losses during the nine months ended September 30, 2024. See Note 3 to the unaudited condensed consolidated financial statements for further information on the allowance for credit losses.
Previous wording
Interest expense consists of interest accrued on our revolving line of credit, 9.00% Senior Notes due 2027, unused line of credit and maintenance fees, as well as amortization of debt issuance costs. Interest expense remained consistent for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024.
Current wording
Interest expense consists of interest accrued on our revolving line of credit, 9.00% Senior Notes due 2027, unused line of credit and maintenance fees, as well as amortization of debt issuance costs. Interest expense remained consistent for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024.
Previous wording
The $0.9 million decrease in depreciation and amortization expense for the six months ended June 30, 2025 primarily consists of a decrease in amortization expense related to no longer amortizing intangible assets related to the Cara license as the intangible assets were fully impaired during the three months ended June 30, 2024. In addition, MOD3 was classified as held for sale for the current period resulting in no depreciation on fixed assets included in held for sale.
Current wording
The $1.2 million decrease in depreciation and amortization expense for the nine months ended September 30, 2025 primarily consists of a decrease in amortization expense related to no longer amortizing intangible assets related to the license with Cara Therapeutics, Inc, as the intangible assets were fully impaired during the three months ended June 30, 2024. In addition, MOD3 was classified as held for sale for the current period resulting in no depreciation on fixed assets classified as held for sale.
Previous wording
General and administrative expenses consist primarily of compensation; stock-based compensation and related costs for management, staff and Board; legal and audit expenses; and corporate governance expenses. General and administrative expenses increased to $6.1 million for the six months ended June 30, 2025 from $5.6 million for the six months ended June 30, 2024 primarily due to an increase in compensation costs during the period.
Current wording
General and administrative expenses consist primarily of compensation; stock-based compensation and related costs for management, staff and Board; legal and audit expenses; and corporate governance expenses. General and administrative expenses increased to $9.4 million for the nine months ended September 30, 2025 from $8.6 million for the nine months ended September 30, 2024 primarily due to an increase in compensation costs and legal costs during the period.
Previous wording
Other income (expense), net decreased to an expense of $2.4 million for the six months ended June 30, 2025 from an income of $3.4 million for the six months ended June 30, 2024. The $5.8 million decrease is primarily due to net losses on finance receivables in the current period compared to net gains on finance receivables during the same period in the prior year.
Current wording
Other income (expense), net decreased to income of $1.7 million for the nine months ended September 30, 2025 from income of $3.7 million for the nine months ended September 30, 2024. The $2.0 million decrease is primarily due to a loss on the revaluation of finance receivables in the current period compared to a gain on the revaluation of finance receivables during the same period in the prior year.
Previous wording
During the six months ended June 30, 2025 and 2024 we recognized $2.3 million and $1.3 million of income tax expense, respectively. Income tax expense increased period over period due to the release of valuation allowance on deferred tax assets of $1.0 million during the six months ended June 30, 2024 and a decrease in the Company's provision for credit losses compared to the same period in the prior year.
Current wording
During the nine months ended September 30, 2025 and 2024 we recognized $4.2 million and $2.2 million of income tax expense, respectively. Income tax expense increased period over period due to the release of valuation allowance on deferred tax assets of $1.0 million during the nine months ended September 30, 2024 and a change in the Company's provision for credit losses compared to the same period in the prior year.
Previous wording
As of June 30, 2025, we had $8.0 million in cash and cash equivalents, compared to $5.9 million as of December 31, 2024. The primary driver of the $2.1 million increase in our cash balance was primarily related to interest, fees, principal and royalty payments received on finance receivables, and proceeds from the sale of finance receivables. The increase in cash and cash equivalents was partially offset by the payment of dividends, investment funding, net of deferred fees and origination expenses, net payments of our credit facility, payments for payroll and benefits expense, payments on accounts payable, and share repurchases.
Current wording
As of September 30, 2025, we had $10.2 million in cash and cash equivalents, compared to $5.9 million as of December 31, 2024. The primary driver of the $4.3 million increase in our cash balance was primarily related to interest, fees, principal and royalty payments received on finance receivables, and proceeds from the sale of finance receivables. The increase in cash and cash equivalents was partially offset by the payment of dividends, investment funding, net of deferred fees and origination expenses, net payments of our credit facility, payments for payroll and benefits expense, payments on accounts payable, and share repurchases.
Previous wording
We entered into a $45.0 million revolving credit facility in June 2023 with First Horizon Bank. The Credit Agreement provides for one or more incremental increases not to exceed $80.0 million, subject to the consent of the Agent and each Lender, at any time prior to the Commitment Termination Date. On October 10, 2023, the Company entered into a First Amendment to Credit Agreement pursuant to which Woodforest National Bank was added as a lender under the Credit Agreement for an aggregate commitment of $15.0 million, thereby increasing the aggregate commitments under the Credit Agreement from $45.0 million to $60.0 million. As of June 30, 2025, there was $0.3 million outstanding amount under the new Credit Agreement. The $60.0 million Credit Agreement contains a $5.0 million liquidity covenant, bringing the total amount available for borrowing to $54.7 million.
Current wording
We entered into a $45.0 million revolving credit facility in June 2023 with First Horizon Bank. The Credit Agreement provides for one or more incremental increases not to exceed $80.0 million, subject to the consent of the Agent and each Lender, at any time prior to the Commitment Termination Date. On October 10, 2023, the Company entered into a First Amendment to Credit Agreement pursuant to which Woodforest National Bank was added as a lender under the Credit Agreement for an aggregate commitment of $15.0 million, thereby increasing the aggregate commitments under the Credit Agreement from $45.0 million to $60.0 million. As of September 30, 2025, there was no outstanding amount under the new Credit Agreement. The $60.0 million Credit Agreement contains a $5.0 million liquidity covenant, bringing the total amount available for borrowing to $55.0 million.
Previous wording
As of June 30, 2025, our finance receivables portfolio contains $237.6 million of net finance receivables and $0.6 million of marketable investments. We expect these assets to generate positive cash flows during the remainder of 2025. We continuously monitor the short and long-term financial position of our finance receivables portfolio. In addition, the majority of our finance receivables portfolio are debt instruments that carry floating interest rates. Changes in interest rates, including the levels of the underlying reference rates may affect the interest income for debt instruments with floating rates. We believe we are well positioned to benefit should market interest rates rise in the future.
Current wording
As of September 30, 2025, our finance receivables portfolio contains $245.4 million of net finance receivables and $0.3 million of marketable investments. We expect these assets to generate positive cash flows during the remainder of 2025. We continuously monitor the short and long-term financial position of our finance receivables portfolio. In addition, the majority of our finance receivables portfolio are debt instruments that carry floating interest rates. Changes in interest rates, including the levels of the underlying reference rates may affect the interest income for debt instruments with floating rates. We believe we are well positioned to benefit should market interest rates rise in the future.
Previous wording
We continue to evaluate multiple attractive opportunities that, if consummated, we believe would similarly generate additional income. Since the timing of any investment is difficult to predict, our Finance Receivables segment may not be able to generate positive cash flow above what our existing assets are expected to produce in 2025. We do not assume any near-term repayments from borrowers, and as a result, no assurances can be given that actual results would not differ materially from the statement above.
Current wording
Since the timing of any investment is difficult to predict, our Finance Receivables segment may not be able to generate positive cash flow above what our existing assets are expected to produce in 2025. We do not assume any near-term repayments from borrowers, and as a result, no assurances can be given that actual results would not differ materially from the statement above.
Previous wording
As of June 30, 2025, we had $7.5 million in unfunded commitments. Please refer to Item 1., Financial Statements, Note 7 of the notes to the unaudited condensed consolidated financial statements for further information regarding the Company’s commitments and contingencies.
Current wording
As of September 30, 2025, we had $2.5 million in unfunded commitments. Please refer to Item 1., Financial Statements, Note 7 of the notes to the unaudited condensed consolidated financial statements for further information regarding the Company’s commitments and contingencies.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
The $0.4 million decrease in depreciation and amortization expense for the three months ended June 30, 2025 primarily related to no longer amortizing intangible assets related to the Cara license as the intangible assets were fully impaired. In addition, MOD3 was classified as held for sale for the current period resulting in no depreciation on fixed assets included in held for sale.