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FAIR VALUE
 6 Months Ended
Jun. 30, 2025
Fair Value Disclosures [Abstract]  
FAIR VALUE FAIR VALUE
Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs.
 
•Level 1: Quoted prices in active markets for identical assets or liabilities.
•Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
•Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
The following tables reflects the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2025 and December 31, 2024 (in thousands):

June 30, 2025Financial Statement ClassificationLevel 1Level 2Level 3Total
Assets
Cash equivalents:
U.S. TreasuriesCash and cash equivalents$— $3,386 $— $3,386 
Money market fundsCash and cash equivalents41,597 — — 41,597 
Short-term investments:
U.S. TreasuriesShort-term investments— 51,097 — 51,097 
Total$41,597 $54,483 $— $96,080 
Liabilities
Short-term contingent considerationContingent consideration, current portion$— $— $726 $726 
Derivative liabilityLong-term debt— — 168 168 
Total$— $— $894 $894 
December 31, 2024Financial Statement ClassificationLevel 1Level 2Level 3Total
Assets
Cash equivalents:
U.S. TreasuriesCash and cash equivalents$— $3,897 $— $3,897 
Money market fundsCash and cash equivalents46,163 — — 46,163 
Short-term investments
U.S. TreasuriesShort-term investments— 49,466 — 49,466 
Total$46,163 $53,363 $— $99,526 
Liabilities
Short-term contingent considerationContingent consideration, current portion$— $— $726 $726 
Derivative liabilityLong-term debt— — 168 168 
Total$— $— $894 $894 
    
Cash and Cash Equivalents

The Company considers all highly liquid investments with a maturity date at purchase of three months or less to be cash equivalents. The Company invests its cash in money market funds and marketable securities including U.S. Treasury and government agency securities, and higher quality debt securities of financial and commercial institutions. The Company classified money market funds as Level 1, due to their short-term maturity, and measured the fair value based on quoted prices in active markets for identical assets. The Company classified U.S. Treasury and government agency securities as Level 2, as the inputs used to value these instruments are directly observable or can be corroborated by observable market data for substantially the full term of the assets.

Short-Term Investments

The Company considers all highly liquid investments with a maturity date at purchase of more than three months and less than one year to be short-term investments. The Company’s short-term investments consist of marketable securities, which may include commercial paper and U.S. Treasury securities. The Company classified its short-term investments as trading securities. The short-term investments are recorded at fair value using Level 2 inputs, as the inputs used to value these instruments are directly observable or can be corroborated by observable market data for substantially the full term of the assets. Realized gains and losses on short-term investments are included in Interest income in the Condensed Consolidated Statements of Comprehensive Loss.

Unrealized gains and losses from short-term investments classified as trading securities recognized by the Company for the three and six months ended June 30, 2025 and 2024 were immaterial.

Contingent Consideration Obligations

Spectrum Merger Contingent Variable Rights

In connection with the Spectrum Merger, the Company issued contingent value rights (“CVRs”) that represent a contingent consideration obligation that is measured at fair value. As of both June 30, 2025 and December 31, 2024, the fair value of the Company’s CVR liability related to the Spectrum Merger was determined by the Company to be zero. The Company recognized no expense or benefit for the change in fair value of the CVR contingent consideration during the three and six months ended June 30, 2025 or 2024.

The fair value of the CVR contingent consideration is determined using a Monte Carlo simulation model under the income approach based on the probability of achievement of ROLVEDON net sales milestones using projections of 2025 net sales and discounted to present value. The significant assumptions used in the calculation of the fair value as of June 30, 2025 included updated projections of future ROLVEDON product net sales, which resulted in no probability of achievement under the Monte Carlo simulation.
Zyla Merger Contingent Consideration Obligation

In connection with the Zyla Merger, the Company assumed a contingent consideration obligation to make contingent consideration payments for future royalties to an affiliate of CR Group L.P. based upon annual INDOCIN product net sales over $20.0 million at a 20% royalty through January 2029. The Company classified the acquisition-related contingent consideration liabilities to be settled in cash as Level 3, due to the lack of relevant observable inputs and market activity. As of both June 30, 2025 and December 31, 2024, the fair value of the INDOCIN product contingent consideration was determined to be $0.7 million, and has been classified as Contingent consideration, current in the Company’s Condensed Consolidated Balance Sheets. The Company recognized no expense or benefit for the change in fair value of contingent consideration during the three and six months ended June 30, 2025 or 2024.

The fair value of the contingent consideration incurred in the Zyla Merger is determined using an option pricing model under the income approach based on estimated INDOCIN product net sales through January 2029 and discounted to present value. The significant assumptions used in the calculation of the fair value as of June 30, 2025 included updated projections of future INDOCIN product net sales.

Derivative Liability
The Company determined that an embedded conversion feature included in the 2027 Convertible Notes required bifurcation from the host contract and to be recognized as a separate derivative liability carried at fair value. The estimated fair value of the derivative liability, which represents a Level 3 valuation, was $0.2 million as of both June 30, 2025 and December 31, 2024, and was determined using a binomial lattice model using certain assumptions and consideration of an increased conversion ratio on the underlying convertible notes that could result from the occurrence of certain events. The significant assumption used in the binomial lattice model is a credit spread of 10.5%.

There was no change in the fair value of the derivative liability for the three and six months ended June 30, 2025 or 2024.

Financial Instruments Not Required to be Remeasured at Fair Value

The Company’s other financial assets and liabilities are not remeasured to fair value, as the carrying cost of each approximates its fair value. As of June 30, 2025, the estimated fair value of the 2027 Convertible Notes, excluding the bifurcated embedded conversion option, was approximately $36.3 million, compared to a par value of $40.0 million. As of December 31, 2024, the estimated fair value of the 2027 Convertible Notes, excluding the bifurcated embedded conversion option, was approximately $34.8 million, compared to a par value of $40.0 million. The Company estimated the fair value of its 2027 Convertible Notes as of June 30, 2025 and December 31, 2024 based on a market approach, which represents a Level 2 valuation.