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美国
证券交易委员会
华盛顿特区20549
表格10-Q
（标记一）
☒根据1934年证券交易所法第13或15(d)条规定的季度报告

截至季度末2024年9月30日

或者

☐根据美国证券交易法规定第13或15(d)条的转型报告

过渡期从 到
委托文件编号：001-39866001-35060

pacirabiosciencesa05.jpg

Pacira BioSciences，INC。
（依据其宪章指定的注册名称）
 
特拉华州51-0619477
（注册或组织的）提起诉讼的州或其他司法管辖区（如适用）
组建国的驻地		（IRS雇主
鉴别编号)

5401 West Kennedy Boulevard，Suite 890
坦帕。, （561） 33609
（总部地址和邮政编码）
(813) 553-6680
(注册人电话号码，包括区号)

在法案第12(b)条的规定下注册的证券：
每一类的名称交易标的在其上注册的交易所的名称
纳斯达克证券交易所PCRX纳斯达克全球精选市场


请在检查标记旁注明注册者(1)在过去的12个月内(或在注册者需要提交这些报告的更短期间内)已经提交了所有根据1934年证券交易法第13或15(d)部分所要求的报告以及(2) 在过去的90天内已经受到这些提交要求的约束。☒ Yes  ☐ 否

请用复选标记表示，注册者在过去12个月内（或者在要求注册者提交此类文件的较短期间内）是否按照《S-t法规》第405条规定提交了每一个互动数据文件。☒ Yes  ☐ 否

请用勾号表示公司是否是大型加速提交者，加速提交者，非加速提交者，较小的报告公司或新兴成长公司。请参阅交易法规定中“大型加速提交者”，“加速提交者”，“较小的报告公司”和“新兴成长公司”的定义。

大型加速报告人☒加速文件提交人☐
非加速文件提交人☐较小的报告公司☐
新兴成长公司☐
如果一家新兴增长型公司，请打勾表示公司已选择不使用《交易所法》第13(a)节规定的延长过渡期，以符合任何新的或修订的财务会计准则。☐

请在复选框中打勾，以表示注册商是否是外壳公司（如证券交易法第120亿.2条所定义）。☐是的☒ 否

截至2024年11月1日， 46,173,240 注册人普通股每股面值$0.001，已发行股份。

目录
Pacira BioSciences，INC。
10-Q表格季度报告
2024年9月30日结束的本季度

目录
  第 # 页
 
 
 
 
 
 
   
 

Pacira BioSciences, Inc. | 第三季度 2024 表格10-Q | 第三页
目录
第一部分—财务信息
项目1。 基本报表（未经审计）
Pacira BioSciences，INC。
简明合并资产负债表
（以千为单位，除股份数量和每股金额外）
（未经审计）
September 30,
2024		12月31日,
2023
资产
流动资产：  
现金及现金等价物$245,965 $153,298 
短期可供出售投资207,845 125,283 
应收账款，净额100,653 105,556 
存货净额111,865 104,353 
预付费用及其他流动资产23,641 21,504 
流动资产合计689,969 509,994 
非流动资产可供出售投资— 2,410 
固定资产净额166,852 173,927 
使用权资产，净额53,830 61,020 
商誉— 163,243 
无形资产, 净额440,292 483,258 
递延所得税资产134,022 144,485 
投资和其他资产36,726 36,049 
总资产$1,521,691 $1,574,386 
负债和股东权益  
流动负债:  
应付款项$19,367 $15,698 
应计费用76,377 64,243 
租赁负债9,191 8,801 
可转换优先票据的流动部分，净额201,466 8,641 
总流动负债306,401 97,383 
可转换的优先票据，净额278,867 398,594 
长期负债净额107,024 115,202 
租赁负债47,875 54,806 
或有事项考虑19,157 24,698 
其他负债12,784 13,573 
总负债772,108 704,256 
承诺和 contingencies（注意 15）
股东权益:  
优先股，面值$0.001; 5,000,000 无 截至2024年9月30日和2023年12月31日发行并流通
— — 
普通股，每股面值 $，授权股数：百万股；发行股数：分别为2024年6月30日和2023年12月31日：百万股；流通股数：分别为2024年6月30日和2023年12月31日：百万股0.001; 250,000,000 46,985,386股份发行量为46,148,146 在2024年9月30日的流通股份有 46,481,174截止2024年3月31日，已发行股票总数为56,637,473股
47 46 
截至2024年3月31日和2023年12月31日，公司的库藏股票分别有2,279,784股和2,693,653股。837,240 和 零 股份分别于2024年9月30日和2023年12月31日，包括消费税
(25,121)— 
其他股本996,376 976,633 
累积赤字(222,397)(106,796)
累积其他全面收益678 247 
股东权益合计749,583 870,130 
负债和股东权益合计$1,521,691 $1,574,386 
请参阅附注事项的简明合并财务报表。
Pacira BioSciences, Inc. | 第三季度 2024 表格10-Q | 第4页
目录
Pacira BioSciences，INC。
简明合并利润表
2024年4月27日
（未经审计）
三个月结束
September 30,		九个月结束
September 30,
 2024202320242023
营收：    
产品净销售额$167,722 $163,583 $509,933 $492,481 
版税收入851 343 3,780 1,253 
总收入168,573 163,926 513,713 493,734 
营业费用：    
营业成本38,864 39,750 130,542 136,977 
研发19,104 20,830 57,680 56,794 
销售、一般及行政费用74,333 67,947 214,485 203,640 
取得的无形资产摊销14,322 14,322 42,966 42,966 
商誉减值163,243 — 163,243 — 
应收掌握假设（收益）费用、重组费用和其他(1,766)3,356 2,872 (1,150)
营业费用合计308,100 146,205 611,788 439,227 
（损失）营业利润(139,527)17,721 (98,075)54,507 
其他收入（支出）：    
利息收入5,482 2,766 14,134 8,019 
利息支出(4,689)(3,464)(11,889)(16,918)
债务提前清偿的收益（损失）— — 7,518 (16,926)
其他，净额(122)(422)(320)(701)
总其他收入（费用），净额671 (1,120)9,443 (26,526)
（亏损）所得税前收入(138,856)16,601 (88,632)27,981 
所得税费用(4,610)(5,743)(26,969)(10,896)
净（亏损）利润$(143,466)$10,858 $(115,601)$17,085 
每股普通股净（亏损）收益：    
基本和稀释每普通股的净（损失）收益$(3.11)$0.23 $(2.50)$0.37 
加权平均流通股数:  
基本46,134 46,416 46,269 46,151 
稀释46,134 52,067 46,269 46,343 
 
请参阅附注事项的简明合并财务报表。
Pacira BioSciences, Inc. | 第三季度 2024 表格10-Q | 第5页
目录
Pacira BioSciences，INC。
简明综合收益（损失）合并报表
（以千为单位）
（未经审计）
三个月已结束
九月三十日		九个月已结束
九月三十日
 2024202320242023
净（亏损）收入$(143,466)$10,858 $(115,601)$17,085 
其他综合收益（亏损）：  
扣除税款的未实现投资净收益597 146 437 362 
外币折算调整(24)17 (6)8 
其他综合收入总额573 163 431 370 
综合（亏损）收入$(142,893)$11,021 $(115,170)$17,455 
 
请参阅附注事项的简明合并财务报表。
Pacira BioSciences, Inc. | 第三季度 2024 表格10-Q | 第6页
目录
Pacira BioSciences，INC。
股东权益的简明合并报表
截至2024年和2023年9月30日三个月止
（以千为单位）
（未经审计）

 流通股本数额外的
实缴
资本		累积的
$		累积的
其他
综合
收入		 
 普通股份。库藏股普通股库存股总计
2024年6月30日余额46,954 (837)$47 $(25,121)$983,178 $(78,931)$105 $879,278 
归属限制性股票单位31 — — — — — — — 
为员工支付已获授的受限制股份单位的代扣个人所得税而暂扣的普通股— — — — (32)— — (32)
股票补偿— — — — 13,230 — — 13,230 
其他全面收益（注释10）— — — — — — 573 573 
净损失— — — — — (143,466)— (143,466)
2024年9月30日的余额46,985 (837)$47 $(25,121)$996,376 $(222,397)$678 $749,583 
普通股额外的
实缴
资本		累积的
$		累积的
其他
综合
损失
股份金额总计
2023年6月30日的余额46,409 $46 $950,626 $(142,524)$(173)$807,975 
行使股票期权1 — 25 — — 25 
归属限制性股票单位17 — — — — — 
股票补偿— — 12,530 — — 12,530 
其他综合收益（注10）— — — — 163 163 
净利润— — — 10,858 — 10,858 
2023年9月30日结余46,427 $46 $963,181 $(131,666)$(10)$831,551 
请参阅附注事项的简明合并财务报表。




Pacira BioSciences, Inc. | 第三季度 2024 表格10-Q | 第7页
目录
Pacira BioSciences，INC。
股东权益的简明合并报表
截至2024年和2023年9月30日的九个月
（以千为单位）
（未经审计）

 Number of Shares OutstandingAdditional
Paid-In
Capital		Accumulated
Deficit		Accumulated
Other
Comprehensive
Income		 
 Common SharesTreasury SharesCommon StockTreasury StockTotal
Balance at December 31, 202346,481 — $46 $— $976,633 $(106,796)$247 $870,130 
Vested restricted stock units448 — 1 — — — — 1 
Common stock withheld for employee withholding tax liabilities on vested restricted stock units— — — — (414)— — (414)
Common stock issued under employee stock
purchase plan		56 — — — 1,364 — — 1,364 
Stock-based compensation— — — — 38,905 — — 38,905 
Purchase of treasury stock, inclusive of excise tax— (837)— (25,121)— — — (25,121)
Purchase of capped call transaction, net of tax— — — — (20,112)— — (20,112)
Other comprehensive income (Note 10)— — — — — — 431 431 
Net loss— — — — — (115,601)— (115,601)
Balance at September 30, 202446,985 (837)$47 $(25,121)$996,376 $(222,397)$678 $749,583 
Common StockAdditional
Paid-In
Capital		Accumulated
Deficit		Accumulated
Other
Comprehensive
Loss
SharesAmountTotal
Balance at December 31, 202245,928 $46 $924,095 $(148,751)$(380)$775,010 
Exercise of stock options63 — 1,939 — — 1,939 
Vested restricted stock units386 — — — — — 
Common stock issued under employee stock
purchase plan		50 — 1,672 — — 1,672 
Stock-based compensation— — 35,475 — — 35,475 
Other comprehensive income (Note 10)— — — — 370 370 
Net income— — — 17,085 — 17,085 
Balance at September 30, 202346,427 $46 $963,181 $(131,666)$(10)$831,551 
See accompanying notes to condensed consolidated financial statements.

Pacira BioSciences, Inc. | Q3 2024 Form 10-Q | Page 8
Table of Contents
PACIRA BIOSCIENCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 (In thousands)
(Unaudited)
Nine Months Ended
September 30,
 20242023
Operating activities:  
Net (loss) income$(115,601)$17,085 
Adjustments to reconcile net (loss) income to net cash provided by operating activities:  
Goodwill impairment163,243 — 
Deferred taxes17,113 9,014 
Depreciation of fixed assets and amortization of intangible assets57,542 57,089 
Amortization of debt issuance costs2,284 2,311 
Amortization of debt discount70 728 
(Gain) loss on early extinguishment of debt(7,518)16,926 
Stock-based compensation38,905 35,475 
Changes in contingent consideration(5,541)(3,847)
Other net (gains) losses(53)2,415 
Changes in operating assets and liabilities:  
Accounts receivable, net4,903 1,440 
Inventories, net(7,512)(457)
Prepaid expenses and other assets(6,338)(6,986)
Accounts payable3,409 1,988 
Accrued expenses and income taxes payable12,546 (26,156)
Other liabilities(1,195)40 
Net cash provided by operating activities156,257 107,065 
Investing activities:  
Purchases of fixed assets(8,518)(13,363)
Purchases of available-for-sale investments(207,017)(111,682)
Sales of available-for-sale investments132,627 200,970 
Purchases of debt investments— (6,758)
Net cash (used in) provided by investing activities(82,908)69,167 
Financing activities:  
Proceeds from exercises of stock options— 1,939 
Proceeds from shares issued under employee stock purchase plan1,364 1,672 
Payment of employee withholding taxes on restricted stock unit vests(414)— 
Purchase of treasury stock(25,000)— 
Proceeds from 2029 convertible senior notes287,500 — 
Proceeds from Term loan A facility— 149,550 
Repayment of 2024 convertible senior notes(8,641)— 
Repayment of 2025 convertible senior notes(190,994)— 
Repayment of Term loan B facility— (296,875)
Repayment of Term loan A facility(8,438)(30,625)
Purchase of capped call transactions(26,709)— 
Debt extinguishment costs— (5,750)
Payment of debt issuance and financing costs(9,350)(1,163)
Net cash provided by (used in) financing activities19,318 (181,252)
Net increase (decrease) in cash and cash equivalents92,667 (5,020)
Cash and cash equivalents, beginning of period153,298 104,139 
Cash and cash equivalents, end of period$245,965 $99,119 

See accompanying condensed notes to consolidated financial statements.
Pacira BioSciences, Inc. | 第三季度 2024 表格10-Q | 第9页
目录
Pacira BioSciences，INC。
简明并列现金流量表（续）
 
（以千为单位）
（未经审计）
九个月结束
September 30,
20242023
补充现金流量信息： 
支付的利息现金$10,191 $24,931 
所得税净现金支付$9,575 $2,072 
非现金投资和筹资活动:  
应付账款和应计负债中包括固定资产$415 $1,470 
股票回购中包含的消费税已计入应计负债$121 $— 
请参阅附注事项的简明合并财务报表。
Pacira BioSciences, Inc. | 第三季度 2024 表格 10-Q | 第 10 页
目录
Pacira BioSciences，INC。
简明合并财务报表附注
（未经审计）

备注1—业务描述
Pacira BioSciences公司及其子公司（统称为“公司”或“Pacira”）提供创新的非阿片类镇痛疗法，改变患者的生活。该公司的长效局部麻醉药EXPAREL®（布比卡因脂质体注射悬浮液）于2012年4月在美国商业化推出，并于2021年11月获得选择的欧洲国家和英国的批准。EXPAREL利用公司专有的多泡脂质体（pMVL）药物递送技术，将药物封装而不改变其分子结构，并在所需时间内释放。EXPAREL目前指示用于通过浸润在6岁及以上患者中产生术后局部镇痛，以及通过成人颈间斜角支配神经阻滞产生术后区域镇痛，在成人中腘窝块肌块神经阻滞，以及成人股后股部外展神经阻滞用于术后疼痛管理。2021年11月，公司收购了Flexion Therapeutics公司，或Flexion（“Flexion收购”），并将ZILRETTA® （曲安奈德延释注射悬浮液）加入其产品组合。ZILRETTA是首个且唯一的关节内延迟释放注射，用于治疗关节炎（OA）膝关节疼痛。2019年4月，公司通过收购MyoScience公司，或MyoScience（“MyoScience Acquisition”），将iovera°®加入其商业供应。iovera°系统是一种手持式冷冻镇痛设备，利用精确控制的冷温度剂量对靶神经进行立即、长效、无药物镇痛治疗。该公司还在推进PCRX-201（enekinragene inzadenovec）的开发，这是一种新型局部给药基因治疗，有潜力治疗OA等多种常见疾病。
Pacira受制于和类似行业和阶段的公司常见风险，包括但不限于来自更大公司和潜在通用入境者的竞争，对营业收入的依赖 三 产品，对少数批发商的依赖，对有限制制造地点的依赖，新的科技创新，对关键人员的依赖，对第三方服务供应商和独家供应商的依赖，保护专有技术，遵守政府监管规定以及与网络安全概念相关的风险。
该公司作为一个专注于开发、制造、营销、分销和销售非阿片类疼痛管理和再生健康解决方案的单一业务进行管理和运营。该公司由一个统一的管理团队管理，与其组织结构一致，首席执行官——即公司的首席运营决策者——在统一层面上管理和分配资源。自2024年1月2日起，该公司任命了一位新的首席执行官。与公司前任首席运营决策者一致，公司将其业务视为 之一 可报告的运营部门，以评估其业绩、分配资源、设定运营目标和预测未来的财务业绩。
备注2—重要会计政策摘要
呈报依据及合并原则
这些中期简明综合财务报表已根据美国通用会计准则（GAAP）以及美国证券交易委员会（“SEC”）的规定进行编制，用于中期报告。根据这些规定，原本包括在完整年度财务报表中的某些信息和附注披露已被压缩或省略。因此，应当阅读这些中期简明综合财务报表时，同时参考公司包括在“2023年度报告”中的经审计年度综合财务报表和附注。 年度报告10-k表明截至2023年12月31日的年度报告 （“2023年度报告”）。
截至2024年9月30日及截至2024年9月30日为止的三个和九个月份的简明综合基本报表未经审计，但包括所有调整（仅包括正常重复的调整），据管理层意见，这些调整是必要的，以依照公认会计原则公正地呈现本处所述的财务信息。截至2023年12月31日的简明综合资产负债表源自包括在公司2023年年度报告中的审计综合基本报表。所呈现的简明综合基本报表反映了从先前发布的财务报表进行的某些重新分类，以符合当前年度的呈报。全资子公司的账户包括在简明综合基本报表中。合并中已互相抵销的关联公司账户和交易已被消除。
这些中期期间的经营结果并不一定代表任何其他中期期间或全年可能预期的结果。
Pacira BioSciences, Inc. | 第三季度 2024 表格10-Q | 第11页
目录
主要客户集中度
公司通过直发计划销售EXPAREL，根据该计划，订单通过批发商（包括美源伯根健康有限公司、君耀医疗、和麦克森药品公司）进行处理，但产品的发货直接发送至各个账户，如医院、门诊手术中心和个别医师。 下表包括公司营收中最大批发商在每个期间中所占比例： 三 每个期间所示，公司营收中最大批发商所占比例：
三个月结束
September 30,		九个月结束
September 30,
2024202320242023
最大的批发商35%33%35%33%
第二大批发商23%24%23%24%
第三大批发商20%19%20%20%
　　　　　　　　总计78%76%78%77%
截至2024年9月30日尚未采纳的最新会计准则
2023年11月，财务会计准则委员会（FASB）发布了会计准则更新（ASU）2023-07， 分部门报告（主题280），改进可报告分部披露。 ASU修订通过增加对重要分部支出的披露，主要从中期和年度披露的角度改进可报告分部披露要求。新的分部披露要求适用于只有一个可报告分部的实体。ASU的修订将于2023年12月15日后开始的财政年度和随后的中期生效，并允许提前采纳。ASU修订要求以追溯方式采纳。公司目前正在评估采纳ASU 2023-07对其合并财务报表的影响。
2023年12月，FASB发布了ASU 2023-09，所得税（主题740），所得税披露的改进ASU修订案回应了投资者对所得税信息更透明的要求，通过改善主要与税率协调和所支付的所得税信息相关的所得税披露。 ASU的修订适用于2024年12月15日后开始的财政年度，可以根据前瞻性或回顾性的方式予以采纳。 公司目前正在评估采用ASU 2023-09对其合并财务报表的影响。
注3——收购：营业收入
与客户签订合同的营业收入
公司的净产品销售包括(i)EXPAREL在美国、欧洲联盟或欧盟和英国；(ii)ZILRETTA在美国；(iii)iovera°在美国、加拿大和欧洲；以及(iv)用于兽医用途的布比卡因脂质体注射悬浮液的销售。版税收入与通过销售用于兽医用途的布比卡因脂质体注射悬浮液的合作许可协议有关。公司不认为来自EXPAREL和ZILRETTA以外销售的收入是其综合收入的重要来源。因此，以下披露仅限于与EXPAREL和ZILRETTA的净产品销售相关的营业收入。
产品净销售额
公司通过一个直运舰船计划销售EXPAREL，根据最终用户（即医院、日间手术中心和医疗保健提供者办公室）的订单，订单是通过批发商处理的。EXPAREL直接交付给最终用户，批发商从未实际占有产品。公司主要将ZILRETTA销售给专业经销商和专业药店，然后经销商将ZILRETTA转售给医生、诊所和某些医疗中心或医院。公司还直接与医疗保健提供者和中间商（例如采购组织）签订合同。当公司预计会因交付这些商品而有权获得的对价数量发生变化时，产品收入会在商品控制权转让给客户时确认。EXPAREL和ZILRETTA的营业收入是在产品转让给客户时记录的。
销售产品的收入按净额记录，扣除退货津贴、及时付款折扣、服务费、政府回扣、成交量折扣和退还。这些准备金基于对相关销售金额的估计而设定。这些金额被视为变量考量，根据最可能金额方法在销售时确认并扣减交易价格，除了退货款项是基于预期
Pacira BioSciences, Inc. | 第三季度 2024 表格10-Q | 第12页
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变量方法。公司在交易价格中包括这些估计金额，只要存在重大累积已确认营业收入出现重大逆转的概率不大，或者与可变对价相关的不确定性得到解决。
费用和折扣的退单代表根据向退伍军人事务部医院、参与GPO成员、3400亿合格实体和其他签约客户以低于标价出售产品的合同承诺而产生的预计义务。3400亿药品折扣计划是美国联邦政府的一个项目，要求参与的药品制造商以降低的价格向合格的卫生保健机构和覆盖实体提供门诊药物。客户通过批发商发布的退款通知要求扣除开票金额和折扣销售价格之间的差额。当相关收入确认时，将建立准备金，导致产品收入和应收账款净额的减少。退单金额在销售时确定，公司通常会在收到批发商通知后的几周内为该金额发放信用额度。退单准备金包括公司预计要发放的基于预计销售数量和客户已要求但尚未发放信用额度的退单。
对于其中一些项目的计算，管理层需要根据销售数据、历史回报数据、合同、法定要求和可能在将来获得的其他相关信息进行估计。这些准备金的充足性每季度进行审查。
应收账款
应收账款的大部分来自产品销售，代表来自批发商、医院、门诊手术中心、专业分销商、专业药房和个人医生的应收款项。付款条件通常从交易日期起计算。零至四个月 从交易日期起计算，因此没有重大的融资成分。
履行责任
绩效义务是合同中向客户转让独立商品或服务的承诺，也是会计准则Codification中的计量单位，即ASC 606。合同的交易价格分配给每个独立的绩效义务，并在绩效义务得到满足时或随之确认为营业收入。
在合同订立时，公司评估与客户的合同中承诺的商品，并为每个转移给客户的明显商品确定一个履约义务。在确定各个履约义务时，公司会考虑合同中承诺的所有商品，无论是在客户合同中明确说明还是通过习惯业务实践暗示。公司与客户的合同要求公司转让一个独立的产品，该产品代表一个单一履约义务。公司对于其产品销售的履约义务是在某一时点满足的，即在向客户交付EXPAREL和ZILRETTA时转让控制权。公司认为控制权在交付时已转移，因为客户已经拥有资产的合法所有权，已经转移了资产的实际占有权，客户已经承担了资产的重大风险和回报，公司在那时有权立即收到支付。
收入分解
以下表格代表了按照以下方式呈现的分项净产品销售额（以千为单位）：
三个月结束
September 30,		九个月结束
September 30,
2024202320242023
净产品销售额：
EXPAREL$132,004 $128,667 $401,286 $394,202 
ZILRETTA28,420 28,798 84,966 82,393 
iovera°5,655 5,260 16,359 13,645 
布比卡因脂质体注射悬液1,643 858 7,322 2,241 
总净产品销售额$167,722 $163,583 $509,933 $492,481 
Pacira BioSciences, Inc. | 第三季度 2024 表格10-Q | 第13页
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注4——存货
存货的元件净值如下（单位：千元）：
September 30,12月31日,
20242023
原材料$52,533 $54,099 
在制品23,100 31,215 
成品36,232 19,039 
　　　　　　　　总计$111,865 $104,353 
注5—固定资产
按主要类别总结的固定资产净额如下（以千计）：
September 30,12月31日,
20242023
机械和设备 (1) (2)
$154,652 $121,773 
租赁改善(2)
80,956 61,826 
计算机设备和软件 (2)
23,797 17,186 
办公家具和设备2,645 2,543 
施工中 (2)
34,529 105,905 
总计296,579 309,233 
减：累计折旧 (1)
(129,727)(135,306)
固定资产净额$166,852 $173,927 
(1) 截至2024年9月30日止九个月，该公司处置了与其位于英格兰斯温登的合同制造设施相关的45升EXPAREL制造过程，价值$19.0百万的完全折旧的机械设备。该公司继续在同一设施运营200升EXPAREL制造过程。
(2) 截至2024年9月30日，位于加利福尼亚州圣迭戈的公司科学中心校园内的一个200升EXPAREL生产套房投入使用，大约$进行施工转制造业-半导体，机械，设备，租赁改良和计算机设备和软件。76.1万元从在建施工中重新分类为机械设备，租赁改良和计算机设备和软件。
截至2024年和2023年9月30日三个月的折旧费用分别为$6.0万美元和4.1 截至2024年和2023年9月30日三个月的利息资本化金额分别为$0.51百万美元和0.7制造业-半导体施工的利息资本化金额分别为$
截至2024年9月30日和2023年9月30日的九个月，折旧费用为$14.6万美元和14.1 百万分别为2024年9月30日和2023年9月30日结束的九个月。截至2024年9月30日和2023年9月30日结束的九个月，总计为$1.91百万美元和2.8制造业-半导体施工的利息资本化金额分别为$
截至2024年9月30日和2023年12月31日，净固定资产总额包括位于欧洲的制造业-半导体设备和租赁改进，金额为$30.4万美元和36.8百万，分别。
截至2024年9月30日和2023年12月31日，公司的资产养老义务分别为XX百万美元，在其简明综合资产负债表中列示为应计费用和其他负债，用于支付与终止其部分租赁协议时将租用空间恢复到原状所需的费用。4.11百万美元和4.3截至2024年9月30日和2023年12月31日，公司的资产养老义务分别为XX百万美元，在其简明综合资产负债表中列示为应计费用和其他负债，用于支付与终止其部分租赁协议时将租用空间恢复到原状所需的费用。
2024年9月30日结束的三个月内，美国食品药品监督管理局（FDA）批准了与EXPAREL相竞争的仿制竞品，并且一家美国地方法院裁定公司的一项专利无效（更多信息请参见注释15）。 承诺和事后约定公司确定这些事件以及公司普通股价格的随后下降构成了ASC 360下的减值指标。 固定资产截至2024年9月30日，公司对其资产组的账面价值进行了定量收回能力测试。公司估计了未经贴现的未来现金流，预计从这些资产组的使用中产生，发现需要对长期资产进行减值。 否 减值指标认为对长期资产的减值损失是必要的。
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注6—租赁
该公司租赁了位于加利福尼亚圣地亚哥科学中心校园内的EXPAREL和iovera°手柄制造设施等所有设施。该公司还与赛默飞世尔制药服务公司签订嵌入式租赁协议，用于在英国斯温登的制造设施生产EXPAREL和ZILRETTA。根据相对公平价值基础，一部分相关的月基本费用已分配给租赁元件。 两个 与赛默飞世尔制药服务公司签订了嵌入式租赁协议，用于在英格兰斯温登的制造设施生产EXPAREL和ZILRETTA。根据相对公平价值基础，已将部分相关的月基本费用分配给租赁元件。
自2022年7月至2023年2月，公司开始承认位于马萨诸塞州沃本租赁的实验室空间和从弗莱克逊收购中分别承租的位于马萨诸塞州伯灵顿的办公空间的次租金。 2024年2月，沃伯恩（Woburn）马萨诸塞州的实验室空间的租赁和次租赁期已结束。
设施的营业租赁成本包括租赁和非租赁元件，如公共区维护和其他共同营业费用，以及保险和房地产税等履行成本。 净营业租赁费用总额如下（以千为单位）：
三个月已结束九个月已结束
九月三十日九月三十日
2024202320242023
固定租赁成本$3,459 $3,559 $10,416 $10,818 
可变租赁成本562 499 1,345 1,444 
转租收入(56)(167)(248)(489)
总计$3,965 $3,891 $11,513 $11,773 
与经营租赁相关的补充现金流信息如下（单位：千美元）：
九个月结束
September 30,
20242023
支付的经营租赁负债现金，减去租赁激励$9,686 $11,055 
公司选择将租赁资产摊销和租赁负债本金减少净额，合并简明综合现金流量表中的其他负债。
公司以估计的折现率测量了其每项营运租赁合同的租赁负债，该折现率是公司在担保基础上能够借款的利率，适用于每项租赁合同的剩余期限。 加权平均剩余租赁期限和加权平均折现率汇总如下：
September 30,
20242023
加权平均剩余租赁期限5.36 年6.26 年
加权平均折扣率6.99 %7.03 %
公司经营租赁负债的到期日如下（以千为单位）：
年最低汇总
付款到期
2024年（剩余三个月）$3,264 
202512,788 
202612,823 
202712,587 
202810,924 
此后16,426 
未来所有租赁付款总额68,812 
减：隐含利息(11,746)
总经营租赁负债$57,066 
Pacira BioSciences, Inc. | 第三季度 2024 表格10-Q | 第15页
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注7—商誉和无形资产
商誉
公司的商誉来自于2007年从SkyePharma Holding, Inc.（现为Philip Morris International, Inc.的子公司Vectura Group Limited）收购Pacira Pharmaceuticals, Inc.（公司加州的运营子公司），以及2019年的MyoScience收购和2021年的Flexion收购。2023年12月31日的商誉余额为$163.2截至2021年3月27日，未偿还本金总额为$。
Goodwill represents the excess of the purchase price over the estimated fair value of the net assets acquired in a business combination and is subject to impairment testing at least annually or upon the occurrence of a triggering event that could indicate a potential impairment. During the three months ended September 30, 2024, the FDA approved a generic competitor to EXPAREL and a U.S. District Court ruled that one of the Company’s patents was not valid (for more information, see Note 15, Commitments and Contingencies). The Company determined that these events, combined with a subsequent decrease in the Company’s common stock price, indicated that it was more likely than not that the fair value of goodwill may be less than its carrying value, which required the Company to perform a quantitative impairment test. This was performed by comparing the fair value of the Company with its carrying value. If the estimated fair value of the reporting unit is less than the carrying amount of the reporting unit, impairment is indicated, requiring recognition of a goodwill impairment charge up to the carrying value of goodwill. The fair value of the Company was calculated through an income approach, in which the Company calculated the fair value based on the present value of estimated future cash flows. Considerable management judgment is necessary to evaluate the impact of operating and macroeconomic changes and to estimate the future cash flows used to assume fair value. The Company’s estimates of future cash flows consider past performance, current and anticipated market conditions, internal projections and operating plans which incorporate estimates for sales growth and future margins. Additional assumptions include forecasted growth rates, estimated discount rates and the probability of success for the Company’s product pipeline candidate products. The assumptions also reflect current and anticipated market conditions and are consistent with those that would be used by other marketplace participants for similar valuation purposes. Such assumptions are subject to change due to changing economic and competitive conditions. The conclusion of the income approach as of September, 30, 2024 resulted in the carrying value of the Company exceeding its fair value by more than the goodwill balance. As a result, the goodwill balance of $163.2 million was fully impaired during the three months ended September 30, 2024.
如Note 5进一步详细说明， 固定资产在2024年9月30日结束的三个月期间，存在特定事件构成ASC 360下的减值指标 固定资产截至2024年9月30日，公司对其资产组的账面价值进行了定量实现可能性测试。公司估计了预期从利用这些资产组中产生的未经折现未来现金流，并发现 否 资产长期使用开多需要减值计提。无形资产包括在经过评估的长期使用开多资产内。
无形资产
无形资产净额包括来自Flexion收购的进行中研究和开发（IPR&D）、 开发技术，以及来自MyoScience收购的开发技术和客户关系，总结如下（金额以千美元计）：
2024年9月30日Table of Contents累计摊销无形资产净值加权平均有用寿命
截至当前拥有总数 相关限制为：$590,000 $(184,615)$405,385 10年，5个月
客户关系90 (49)41 10 年
总有限寿命无形资产净额590,090 (184,664)405,426 
已获得知识产权和开发支出34,866 — 34,866 
总无形资产净额$624,956 $(184,664)$440,292 
2023年12月31日Table of Contents累计摊销无形资产净值加权平均有用寿命
截至当前拥有总数 相关限制为：$590,000 $(141,655)$448,345 10年5个月
客户关系90 (43)47 10 年
总有限寿命无形资产净额590,090 (141,698)448,392 
已获得知识产权和开发支出34,866 — 34,866 
总无形资产净额$624,956 $(141,698)$483,258 
Pacira BioSciences, Inc. | 第三季度 2024 表格 10-Q | 第 16 页
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无形资产摊销费用为$14.3百万美元分别适用于截至2024年和2023年9月30日的三个月。无形资产摊销费用为$43.0百万美元分别适用于截至2024年和2023年9月30日的九个月。
假设这些无形资产的毛账面价值不变，有限生命周期无形资产的未来预计摊销费用将为$14.32024年剩余三个月，为$57.3自2025年至2030年，每年为$37.42031年为$7.92032年为$2.22033年为$
注意8—债务
公司未偿付债务的账面价值汇总如下（以千为单位）：
September 30,12月31日,
20242023
到期日为2028年3月的定期贷款A设施$107,024 $115,202 
2.125到期日为2029年5月的可转股优先票据
278,867 — 
0.750到期日为2025年8月的可转股优先票据
201,466 398,594 
3.375到期日为2024年5月的可转股优先票据 (1)
— 8,641 
　　　　　　　　总计$587,357 $522,437 
(1)该 3.375%可转换优先票据到期日为2024年5月，已于2024年5月1日到期并偿还。
2028年期贷款A设施
2023年3月31日，公司与作为管理代理人的摩根大通银行和某些贷款机构签订了信贷协议（迄今已修订的 “TLA信贷协议”），为公司当时存在的TlB信贷协议（定义和讨论见下文）下的未偿债务进行再融资。根据TLA信贷协议发放的定期贷款（“TLA定期贷款”）发行于 0.30折扣百分比，并提供本金为美元的单期预付款A贷款150.0百万，由公司和任何子公司担保人的几乎所有资产担保。在某些条件下，公司可以随时在一种或多种情况下通过申请一项或多项增量定期贷款来增加一种或多种新的定期贷款和/或增加任何现有类别的贷款的本金。TLA定期贷款的净收益约为 $149.6扣除原始发行折扣美元后的百万美元0.4百万。
2024年5月8日，摩根大通银行N.A.作为行政代理和某些贷款人签订了第一修正协议（“首次TLA修正”），以修订TLA信贷协议。首次TLA修正允许公司的10亿美元等事宜。150.0百万股票回购计划和下文所述的帽子看涨交易。
TLA定期贷款的总债务构成如下(按千计):
September 30,12月31日,
20242023
到期日为2028年3月的A类贷款设施$108,125 $116,563 
递延融资成本(798)(988)
债务折扣(303)(373)
总债务，减去债务折扣和递延融资成本$107,024 $115,202 
TLA到期日为2028年3月31日，TLA信用协议要求以每季度 $ 还款2.8百万美元，从2023年6月30日开始增加到 $3.8百万美元，从2025年3月31日开始，剩余约 $ 的气球支付到期85.3百万美元。由于公司自愿提前偿还本金，公司无需在2026年9月之前做进一步的本金偿还，尽管公司保留这样做的选项。
TLA贷款协议要求公司在其他事项之间维持（i）不大于的每个财季最后一天，为最近健全担保净杠杆率（根据TLA贷款协议定义） 3.00 为1.00和（ii）不少于的每个财季最后一天，为最近固定费用覆盖率（根据信贷协议定义） 1.50 为1.00。TLA贷款协议要求公司在截至2024年9月30日的九个月内维持不低于的至少$300.03000万欧元500.0百万的无限制现金及现金等价物余额减去（如下文所定义）2025年票据的预付款200.0百万，在2024年9月30日结束的九个月内，减去任何时间额外的2025年票据的预付款
Pacira BioSciences, Inc. | Q3 2024 Form 10-Q | Page 17
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from 91 days prior to the maturity date through the earlier of (i) the latest maturity date of the 2025 Notes and (ii) the date on which there is no outstanding principal amount of the 2025 Notes. The TLA Credit Agreement also contains customary affirmative and negative covenants, financial covenants, representations and warranties, events of default and other provisions. As of September 30, 2024, the Company was in compliance with all financial covenants under the TLA Credit Agreement.
The Company may elect to borrow either (i) alternate base rate borrowings or (ii) term benchmark borrowings or daily simple SOFR (as defined in the TLA Credit Agreement) borrowings. Each term loan borrowing that is an alternate base rate borrowing bears interest at a rate per annum equal to (i) the Alternate Base Rate (as defined in the TLA Credit Agreement), plus (ii) a spread based on the Company’s Senior Secured Net Leverage Ratio ranging from 2.00% to 2.75%. Each term loan borrowing that is a term benchmark borrowing or daily simple SOFR borrowing bears interest at a rate per annum equal to (i) the Adjusted Term SOFR Rate or Adjusted Daily Simple SOFR (as each is defined in the Credit Agreement), plus (ii) a spread based on the Company’s Senior Secured Net Leverage Ratio ranging from 3.00% to 3.75%. During the nine months ended September 30, 2024, the Company made $8.4 million voluntary principal prepayments. During the year ended December 31, 2023, the Company made a scheduled principal payment of $2.8 million as well as $30.6 million of voluntary principal prepayments. As of September 30, 2024, borrowings under the TLA Term Loan consisted entirely of term benchmark borrowings at a rate of 7.95%.
2026 Term Loan B Facility
In December 2021, the Company entered into a term loan credit agreement (the “TLB Credit Agreement”) with JPMorgan Chase Bank, N.A., as administrative agent and the initial lender. The term loan issued under the TLB Credit Agreement (the “TLB Term Loan”) was issued at a 3.00% discount and allowed for a single-advance term loan B facility in the principal amount of $375.0 million, which was secured by substantially all of the Company’s and each subsidiary guarantor’s assets. The net proceeds of the TLB Term Loan were approximately $363.8 million after deducting an original issue discount of $11.2 million.
On March 31, 2023, the Company used the $149.6 million of net borrowings under the TLA Credit Agreement and cash on hand to repay the $296.9 million then-outstanding principal under the TLB Credit Agreement and concurrently terminated the TLB Credit Agreement, which resulted in a $16.9 million loss on early extinguishment of debt. The Company incurred a prepayment fee of 2.00% of the outstanding principal balance of the TLB Term Loan in connection with the termination.
Convertible Senior Notes Due 2029
In May 2024, the Company completed a private placement of $287.5 million in aggregate principal amount of its 2.125% convertible senior notes due 2029, or 2029 Notes, and entered into an indenture with Computershare Corporate Trust, N.A., or 2029 Indenture, with respect to the 2029 Notes. The 2029 Notes accrue interest at a fixed rate of 2.125% per year, payable semiannually in arrears on May 15th and November 15th of each year. The 2029 Notes mature on May 15, 2029.
The total debt composition of the 2029 Notes is as follows (in thousands):
September 30,
2024
2.125% convertible senior notes due May 2029
$287,500 
Deferred financing costs(8,633)
     Total debt, net of deferred financing costs$278,867 
Holders may convert the 2029 Notes prior to the close of business on the business day immediately preceding November 15, 2028, only if certain circumstances are met, including, but not limited to, if during the previous calendar quarter, the last reported sales price of the Company’s common stock was greater than 130% of the conversion price then applicable for at least 20 out of the last 30 consecutive trading days of the quarter. During the quarter ended September 30, 2024, the conditions for conversion were not met.
On or after November 15, 2028, until the close of business on the second scheduled trading day immediately preceding May 15, 2029, holders may convert their 2029 Notes at any time.
Upon conversion, holders will receive the principal amount of their 2029 Notes and any excess conversion value, calculated based on the per share volume-weighted average price for each of the 50 consecutive trading days during the observation period (as more fully described in the 2029 Indenture). For the principal, the Company will settle in cash per the terms of the 2029 Notes. For any excess conversion value, holders may receive cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the Company’s option. The initial conversion rate for the
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2029 Notes is 25.2752 shares of common stock per $1,000 principal amount, which is equivalent to an initial conversion price of $39.56 per share of the Company’s common stock. The conversion rate will be subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest. The initial conversion price of the 2029 Notes represents a premium of approximately 32.5% to the closing sale price of $29.86 per share of the Company’s common stock on the Nasdaq Global Select Market on May 9, 2024, the date that the Company priced the private offering of the 2029 Notes.
As of September 30, 2024, the 2029 Notes had a market price of $757 per $1,000 principal amount. In the event of conversion, holders would forgo all future interest payments, any unpaid accrued interest and the possibility of further stock price appreciation. Upon the receipt of conversion requests, the settlement of the 2029 Notes will be paid pursuant to the terms of the 2029 Indenture. In the event that all of the 2029 Notes are converted, the Company would be required to repay the $287.5 million in principal value in cash, whereas any conversion premium would be required to be repaid in any combination of cash and shares of its common stock (at the Company’s option).
在2028年11月15日之前的营业日结束前，2029年票据只能在以下情况下进行转换：(1)在2024年6月30日结束的日历季度之后的任何日历季度内（仅在该日历季度期间），如果普通股最后报告的成交价格至少连续一个 20个交易日，无论是否连续30 交易日，截至上一个日历季度的最后交易日，等于或大于 13010五个营运部门：猎鹰创意集团、PDP、Sierra Parima、目的地运营和Falcon's Beyond Brands，所有这些板块均为可报告板块。公司的首席营运决策者是执行主席和首席执行官，他们评估财务信息以做出营运决策、评估财务表现和分配资源。营运板块基于产品线组织，对于我们的基于位置的娱乐板块，根据地理位置组织。营运板块的结果包括直接归属于板块的成本，包括项目成本、工资和与工资有关的开支以及与业务板块运营直接相关的间接费用。未分配的企业费用，包括高管、会计、财务、市场营销、人力资源、法律和信息技术支持服务、审计、税收企业法律开支的工资和相关福利，作为未分配的企业开销呈现，成为报告板块的总收入（亏损）和公司未经审计的汇总财务报表结果之间的调节项。 的任何 五个营运部门：猎鹰创意集团、PDP、Sierra Parima、目的地运营和Falcon's Beyond Brands，所有这些板块均为可报告板块。公司的首席营运决策者是执行主席和首席执行官，他们评估财务信息以做出营运决策、评估财务表现和分配资源。营运板块基于产品线组织，对于我们的基于位置的娱乐板块，根据地理位置组织。营运板块的结果包括直接归属于板块的成本，包括项目成本、工资和与工资有关的开支以及与业务板块运营直接相关的间接费用。未分配的企业费用，包括高管、会计、财务、市场营销、人力资源、法律和信息技术支持服务、审计、税收企业法律开支的工资和相关福利，作为未分配的企业开销呈现，成为报告板块的总收入（亏损）和公司未经审计的汇总财务报表结果之间的调节项。 连续交易日的期间（“测量期”）内，2029年票据每个交易日的1,000美元本金金额交易价格均低于 98公司普通股上次报告销售价格乘以每个交易日的转换率的乘积百分比；（3）特定公司事件发生时；或（4）公司赎回时。 2028年11月15日或之后，直至2029年5月15日前第二个预定交易日结束时，2029票据持有人可以随时全部或部分转换其2029票据。转换后，2029票据将通过支付或交付现金或公司普通股的组合来结算，具体取决于适用的转换率。 2029票据不设沉没基金。
在2027年5月17日或之后，并在到期日期前交易日立即之前，如果（i）2029年票据为“可自由交易”（定义见2029年信托契约），并且已支付截至公司发送相关赎回通知日期的任何应计而未付的额外利息；（ii）公司普通股的最后报价超过此前至少连续交易日，包括截至公司发送相关赎回通知日期立即之前的每个交易日的转换价格的的%，以及向公司发送该等通知的交易日的前一个交易日。将赎回的每张2029年票据的赎回价格将为该等2029年票据的本金金额，加上应计而未付的利息，如果有的话。此外，对任何2029年票据进行赎回将构成一项对值基本变更，若在与赎回有关的基础上转换，则2029年票据适用的转换比率将在某些情况下增加。在发生符合2029年信托契约中定义的“对值基本变更”时，除了某些现金合并的有限例外情况外，持有人可以要求公司以相等于每张要回购的2029年票据本金金额的的%及任何应计而未付利息的现金价款回购其所有或部分2029年票据。 50th 在2027年5月17日或之后，并在到期日期前交易日立即之前，如果（i）2029年票据为“可自由交易”（定义见2029年信托契约），并且已支付截至公司发送相关赎回通知日期的任何应计而未付的额外利息；（ii）公司普通股的最后报价超过的%转换价格，则本公司当天将全部或部分2029年票据兑现为现金，而此价格低于该等可自由交易时的平均交易价格。 130符合以下条件的情况下，在2027年5月17日或之后，并在到期日期前交易日立即之前，公司可以在下列条件下现金赎回全部或部分2029年票据：（i）2029年票据为“可自由交易”（定义见2029年信托契约），并且任何应计且未支付的附加利息截至公司发送相关赎回通知日期时已支付；（ii）公司普通股的最后报价超过美元，即每股转换价的%。 20在任何{days}个连续的交易日期间内，此期间的每张债券的每1000美元的票面金额的“交易价格”低于以赎回日前一天为基准的交易日的通知日期计算的每张债券的票面金额的百分之{principal amount}%。30 符合以下条件的情况下，在2027年5月17日或之后，并在到期日期前交易日立即之前，公司可以在下列条件下现金赎回全部或部分2029年票据：（i）2029年票据为“可自由交易”（定义见2029年信托契约），并且任何应计且未支付的附加利息截至公司发送相关赎回通知日期时已支付；（ii）公司普通股的最后报价超过美元，即每股转换价的%；（2）在连续交易日，包括但不限于截至公司发送相关赎回通知日期的交易日结束之前的至少个交易日及发送此类通知前一交易日。将赎回的每张2029年票据的赎回价格将为该2029年票据的本金金额，加上应计而未付的利息，如果有的话。此外，赎回任何2029年票据将构成对值重大变更，在这种情况下，与赎回有关的转换的2029年票据的转换率将在某些情况下增加。在发生对值重大变更（定义见2029年信托契约）时，除了对某些现金合并有限例外情况外，持有人可以要求本公司以相等于回赎的2029年票据本金金额的的%加上任何应计而未付的利息的现金价款回购其全部或部分2029年票据。 100符合以下条件的情况下，在2027年5月17日或之后，并在到期日期前交易日立即之前，公司可以在下列条件下现金赎回全部或部分2029年票据：（i）2029年票据为“可自由交易”（定义见2029年信托契约），并且任何应计且未支付的附加利息截至公司发送相关赎回通知日期时已支付；（ii）公司普通股的最后报价超过美元，即每股转换价的的%，而此价格低于该等可自由交易时的平均交易价格。
尽管2029年的债券目前被列为公司截至2024年9月30日的简明合并资产负债表上的长期债务，但这项债务的未来可转换性和随之的资产负债表分类将在每个季度报告日期进行监控，并根据公司普通股在指定测量期间的市场价格进行分析。如果2029年的债券持有人在指定测量期间内有权随时转换2029年的债券，那么2029年的债券将被视为当前义务，并相应分类为当前债务。
2024年5月9日，与2029年到期债券定价相关，在2024年5月10日，公司与2029年债券的初始认购人（“初始认购人”）就初始认购人行使购买额外2029年债券期权全额的事项进入了私下谈判的封顶看涨交易（“封顶看涨交易”），与2029年债券的初始认购人和/或其各自的关联公司和/或其他金融机构（“期权交易对手”）。封顶看涨交易预计将覆盖公司股票基础上的2029年债券股份数量，受到类似于适用于2029年债券的防稀释调整的限制。
封顶看涨交易有望减少公司普通股在2029年票据转换时可能的稀释，或抵消公司需支付的可能超过转换2029年票据本金金额的现金支付，具体视情况而定，转换2029年票据时，该种减少和/或抵消需受到上限限制。封顶看涨交易的封顶价格最初将约为每股美元53.75 ，每股，相当于公司普通股收盘价美元的约%的溢价 80每股，相当于公司普通股收盘价美元的约%的溢价29.86 每股的收盘价美元
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2024年5月9日，根据帽式看涨交易条款的规定，受到一定调整。该帽式看涨交易被记录为以$成本减少股本超额支付。26.7截至2021年3月27日，未偿还本金总额为$。
受限购票交易是公司与期权交易对手签订的独立交易，不属于2029年票据条款的一部分，也不会影响任何持有人在2029年票据下的权利。2029年票据持有人将不会对受限购票交易拥有任何权利。
2025到期的可转换高级票据
2020年7月，公司完成了一笔定向增发$402.5百万美元的总本金金额 0.750%可转换到期2025年的高级票据，即2025年票据，并与Computershare Corporate Trust, N.A.（原富国银行，N.A.）签订了2025年信托契约，有关2025年票据的情况。2025年票据以固定利率为 0.750%计，每年2月1日21世纪医疗改革法案 和8月1日21世纪医疗改革法案 支付利息，截至2025年8月1日到期。
2024年5月，公司利用2029年债券发行所得的部分净收益回购了$200.0 百万美元总本金的2025年债券，在以折扣形式进行的私下谈判中，以现金方式（包括应计利息）支付了$191.4 百万美元。2025年债券的部分回购导致了$7.5 百万美元的债务提前清偿收益。
2025年债券的总债务构成如下（以千为单位）：
September 30,12月31日,
20242023
0.7502025年8月到期的可转换高级票据
$202,500 $402,500 
递延融资成本(1,034)(3,906)
总负债，扣除推迟支付的融资成本$201,466 $398,594 
持有人可在2025年2月3日之前的工作日营业结束前的任何时间将2025年的债券转换为股票，前提是满足特定条件，包括但不限于，如果在上一个日历季度，公司普通股的最后报价大于 130转换价格的%或以上，最后，在季度的连续交易日中至少 20 ，最后的 30 个交易日。在2024年9月30日结束的季度中，未符合转换条件。
2025年2月3日或之后，直至2025年8月1日前的第二个交易日营业结束前，持有人可以随时转换他们的2025年债券。
在兑换时，持有人将收到他们2025年票据的本金金额和任何 excess conversion value，该值根据每个股票的成交量加权平均价格进行计算， 40 在观察期间的连续交易日内（详述于2025年债券契约中）。对于本金和 excess conversion value，持有人可能选择接收现金，公司普通股的股份，或者公司普通股的现金和股份组合，由公司决定。2025年票据的初始转换率为每1000美元本金金额的13.9324股普通股，相当于公司普通股的初始转换价格为每股71.78 。转换率将在某些事件中受调整，但不会因任何应计未付利息而调整。2025年票据的初始转换价格相当于每股公司普通股的收盘价 32.5美元，是2020年7月7日纳斯达克全球精选市场上公司普通股的收盘售价的约54.17 折，该日是公司定价2025年票据私募的日期。
截至2024年9月30日，2025年债券的市场价格为f $956 pe1000美元本金。如果转换，持有人将放弃所有未来利息支付、任何未支付的应计利息和进一步股价上涨的可能性。一旦收到转换请求，2025年债券的结算将根据2025年信托契约的条款支付。如果所有的2025年债券都被转换，公司将被要求偿还剩余的202.5百万美元的本金价值和任何转换溢价，可以选择用现金和公司普通股的任意组合偿还（由公司选择）。
自2023年8月1日起（但在赎回2025年到期票据不是全部的情况下，不得晚于到期日前的最后一个实际交易日），公司可以赎回所有或部分2025票据，以现金支付。 40th 但最后报告的公司普通股的销售价格（如2025条约中定义）至少达到%s，公司可以赎回所有或部分2025票据，如果公司普通股的最后报告销售价格（定义在2025条约中）已经至少 130在连续至少个交易日中结束，并包括公司发送相关赎回通知前的交易日，以及（ii）公司发送此类通知前一工作日。 20在任何{days}个连续的交易日期间内，此期间的每张债券的每1000美元的票面金额的“交易价格”低于以赎回日前一天为基准的交易日的通知日期计算的每张债券的票面金额的百分之{principal amount}%。30 赎回价格将
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equal the sum of (i) 100% of the principal amount of the 2025 Notes being redeemed, plus (ii) accrued and unpaid interest, including additional interest, if any, to, but excluding, the redemption date. In addition, calling the 2025 Notes for redemption will constitute a “make-whole fundamental change” (as defined in the 2025 Indenture) and will, in certain circumstances, increase the conversion rate applicable to the conversion of such notes if it is converted in connection with the redemption. No sinking fund is provided for the 2025 Notes.
Convertible Senior Notes Due 2024 Assumed from the Flexion Acquisition
Prior to the Flexion Acquisition, in May 2017, Flexion issued an aggregate of $201.3 million principal amount of 3.375% convertible senior notes due May 1, 2024 (the “Flexion 2024 Notes”), pursuant to an indenture between Flexion and Computershare Corporate Trust, N.A. (formerly Wells Fargo Bank, N.A.), as trustee (the “Flexion Trustee”), as supplemented by the First Supplemental Indenture between Flexion and the Flexion Trustee. Interest was payable semi-annually on May 1st and November 1st of each year. Upon the Flexion Acquisition, the principal was assumed and recorded at fair value by the Company.
On January 7, 2022, following the expiration of the offer to purchase, the Company accepted the $192.6 million aggregate principal amount of Flexion 2024 Notes that were validly tendered (and not validly withdrawn). No Flexion 2024 Notes were converted in connection with the Notice. The remaining principal of $8.6 million was repaid at maturity on May 1, 2024.
Interest Expense
The following table sets forth the total interest expense recognized in the periods presented (dollar amounts in thousands):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2024202320242023
Contractual interest expense$4,296 $3,471 $11,404 $16,670 
Amortization of debt issuance costs840 683 2,284 2,311 
Amortization of debt discount23 25 70 728 
Capitalized interest (Note 5)
(470)(715)(1,869)(2,791)
        Total$4,689 $3,464 $11,889 $16,918 
Effective interest rate on total debt3.03 %2.98 %3.00 %3.96 %
NOTE 9—FINANCIAL INSTRUMENTS
Fair Value Measurements
Fair value is defined as the price that would be received to sell an asset or be paid to transfer a liability in the principal or most advantageous market in an orderly transaction. To increase consistency and comparability in fair value measurements, the FASB established a three-level hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of fair value measurements are:
•Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.
•Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data.
•Level 3: Unobservable inputs that are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.
The carrying value of financial instruments including cash and cash equivalents, accounts receivable and accounts payable approximate their respective fair values due to the short-term nature of these items. The fair value of the Company’s convertible senior notes and its TLA Term Loan are calculated utilizing market quotations from an over-the-counter trading market for these notes (Level 2). The fair value of the Company’s acquisition-related contingent consideration is reported at fair value on a recurring basis (Level 3). The carrying amounts of equity investments and convertible notes receivable without readily determinable fair values have not been adjusted for either an impairment or upward or downward adjustments based on observable transactions.
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At September 30, 2024, the carrying values and fair values of the following financial assets and liabilities were as follows (in thousands):
Carrying ValueFair Value Measurements Using
Level 1Level 2Level 3
Financial Assets and Financial Liabilities Measured at Fair Value on a Recurring Basis:
Financial Assets:
Equity investments$15,877 $— $— $15,877 
Convertible notes receivable$12,157 $— $— $12,157 
Financial Liabilities:
   Acquisition-related contingent consideration$19,157 $— $— $19,157 
Financial Liabilities Measured at Amortized Cost:
Term loan A facility due March 2028$107,024 $— $107,584 $— 
   2.125% convertible senior notes due 2029 (1)
$278,867 $— $217,603 $— 
   0.750% convertible senior notes due 2025 (2)
$201,466 $— $193,514 $— 
(1) The closing price of the Company’s common stock as reported on the Nasdaq Global Select Market was $15.05 per share on September 30, 2024, compared to a conversion price of $39.56 per share. At September 30, 2024, as the conversion price was above the stock price, the requirements for conversion have not been met.
(2) The closing price of the Company’s common stock as reported on the Nasdaq Global Select Market was $15.05 per share on September 30, 2024, compared to a conversion price of $71.78 per share. At September 30, 2024, as the conversion price was above the stock price, the requirements for conversion have not been met. The maximum conversion on the principal that could have been due on the 2025 Notes is 2.8 million shares of the Company’s common stock, which assumes no increase in the conversion rate for certain corporate events.
Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis
Equity and Convertible Note Investments
The Company holds strategic investments in clinical and preclinical stage privately-held biotechnology companies in the form of equity and convertible note investments. The following investments have no readily determinable fair value and are recorded at cost minus impairment, if any, plus or minus observable price changes of identical or similar investments (in thousands):
Equity InvestmentsConvertible Notes ReceivableTotal
Balance at December 31, 2022
$15,877 $5,315 $21,192 
   Purchases— 6,758 6,758 
   Foreign currency adjustments— 61 61 
Balance at December 31, 2023
15,877 12,134 28,011 
   Foreign currency adjustments— 23 23 
Balance at September 30, 2024
$15,877 $12,157 $28,034 
Acquisition-Related Contingent Consideration
The Company has recognized contingent consideration related to the Flexion Acquisition in the amount of $19.2 million and $24.7 million as of September 30, 2024 and December 31, 2023, respectively. The Company’s contingent consideration obligations are recorded at their estimated fair values and are revalued each reporting period if and until the related contingencies are resolved. The Company has measured the fair value of its contingent consideration using a probability-weighted discounted cash flow approach that is based on unobservable inputs and a Monte Carlo simulation. These inputs include, as applicable, estimated probabilities and the timing of achieving specified commercial and regulatory milestones, estimated forecasts of revenue and costs and the discount rates used to calculate the present value of estimated future payments. Significant changes may increase or decrease the probabilities of achieving the related commercial and regulatory events, shorten or lengthen the time required to achieve such events, or increase or decrease estimated forecasts.
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In November 2021, the Company completed the Flexion Acquisition, which provided for contingent consideration related to contingent value rights that were issued to Flexion shareholders and certain equity award holders which could aggregate up to a total of $372.3 million if certain regulatory and commercial milestones are met. The aggregate amount was initially $425.5 million prior to the Company’s September 2022 decision to formally discontinue further development of Flexion’s investigational product candidate, PCRX-301. The Company’s obligation to make milestone payments is limited to those milestones achieved through December 31, 2030, and are to be paid within 60 days of the end of the fiscal quarter of achievement. During the three and nine months ended September 30, 2024, the Company recognized contingent consideration gains of $3.2 million and $5.5 million, respectively, due to adjustments reflecting the probability of achieving the remaining Flexion regulatory milestone by the milestone expiration date, partially offset by revisions to the latest discount rates. During the three months ended September 30, 2023 the Company recorded charges of $2.8 million primarily due to market volatility which affects the liability’s present value. During the nine months ended September 30, 2023, the Company recognized gains of $3.8 million due to adjustments to long-term forecasts which reduced the probability of meeting the sales-based contingent consideration milestones by December 31, 2030, the expiration date for achieving the milestones. The gains recognized during the nine months ended September 30, 2023 were partially offset by a decrease in the assumed discount rate that is utilized in calculating the liability’s present value, based on a significant improvement in the Company’s incremental borrowing rate resulting from the TLA Credit Agreement entered into in March 2023. These adjustments were recorded within contingent consideration (gains) charges, restructuring charges and other in the condensed consolidated statements of operations. At September 30, 2024, the weighted average discount rate was 7.9%.
The following table includes the key assumptions used in the valuation of the Company’s contingent consideration:
Assumption
Ranges
Utilized as of
September 30, 2024
Discount rates
7.3% to 8.6%
Probability of payment for remaining regulatory milestone
0%
The change in the Company’s contingent consideration recorded at fair value using Level 3 measurements is as follows (in thousands):
Contingent Consideration
Fair Value
Balance at December 31, 2022
$28,122 
Fair value adjustments and accretion(3,424)
Balance at December 31, 2023
24,698 
   Fair value adjustments and accretion(5,541)
Balance at September 30, 2024
$19,157 
Available-for-Sale Investments
Short-term investments consist of asset-backed securities collateralized by credit card receivables, investment grade commercial paper and corporate, federal agency, government and Yankee bonds with maturities greater than three months, but less than one year. Noncurrent investments consist of asset-backed securities collateralized by credit card receivables and contain maturities greater than one year but less than three years. Net unrealized gains and losses (excluding credit losses, if any) from the Company’s short-term investments are reported in other comprehensive (loss) income. At September 30, 2024 and December 31, 2023, all of the Company’s short-term and noncurrent investments are classified as available-for-sale investments and are determined to be Level 2 instruments, with the exception of U.S. government bonds, which are measured at fair value using standard industry models with observable inputs. The fair value of the commercial paper is measured based on a standard industry model that uses the three-month U.S. Treasury bill rate as an observable input. The fair value of the asset-backed securities and corporate bonds is principally measured or corroborated by trade data for identical issues in which related trading activity is not sufficiently frequent to be considered a Level 1 input or that of comparable securities. The fair value of U.S. government bonds is based on level 1 trading activity. At the time of purchase, all available-for-sale investments had an “A” or better rating by Standard & Poor’s. 
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The following summarizes the Company’s short-term and noncurrent available-for-sale investments at September 30, 2024 and December 31, 2023 (in thousands):
September 30, 2024 Investments
CostGross
Unrealized
Gains		Gross
Unrealized
Losses		Fair Value
(Level 2)
Current:
Asset-backed securities$37,525 $78 $— $37,603 
Commercial paper126,516 273 (15)126,774 
Corporate bonds32,351 72 (5)32,418 
U.S. federal agency bonds5,990 13 — 6,003 
Yankee bond5,018 29 — 5,047 
          Total$207,400 $465 $(20)$207,845 
December 31, 2023 Investments
CostGross
Unrealized
Gains		Gross
Unrealized
Losses		Fair Value
(Level 1)		Fair Value
(Level 2)
Current:
Asset-backed securities$9,539 $1 $— $— $9,540 
Commercial paper77,941 103 — — 78,044 
U.S. federal agency bonds22,849 — (29)— 22,820 
U.S. government bonds14,899 — (20)14,879 — 
Subtotal125,228 104 (49)14,879 110,404 
Noncurrent:
Asset-backed securities2,403 7 — — 2,410 
Subtotal2,403 7 — — 2,410 
          Total$127,631 $111 $(49)$14,879 $112,814 
At September 30, 2024, there were no investments available for sale that were materially less than their amortized cost.
The Company elects to recognize its interest receivable separate from its available-for-sale investments. At September 30, 2024 and December 31, 2023, the interest receivable from its available-for-sale investments recognized in prepaid expenses and other current assets was $0.3 million and $0.4 million, respectively.
Credit Risk
Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, short-term and long-term available-for-sale investments and accounts receivable. The Company maintains its cash and cash equivalents with high-credit quality financial institutions. Such amounts may exceed federally-insured limits.
 As of September 30, 2024, three wholesalers each accounted for over 10% of the Company’s accounts receivable, at 38%, 18% and 16%. At December 31, 2023, three wholesalers each accounted for over 10% of the Company’s accounts receivable, at 37%, 19% and 16%. For additional information regarding the Company’s wholesalers, see Note 2, Summary of Significant Accounting Policies. EXPAREL and ZILRETTA revenues are primarily derived from major wholesalers and specialty distributors that generally have significant cash resources. The Company performs ongoing credit evaluations of its customers as warranted and generally does not require collateral. Allowances for credit losses on the Company’s accounts receivable are maintained based on historical payment patterns, current and estimated future economic conditions, aging of accounts receivable and its write-off history. As of September 30, 2024, there were $0.3 million of allowances for credit losses on its accounts receivable associated with iovera°. As of December 31, 2023, the Company did not deem any allowances for credit losses on its accounts receivable necessary.
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NOTE 10—STOCKHOLDERS’ EQUITY
Accumulated Other Comprehensive Income (Loss)
The following tables illustrate the changes in the balances of the Company’s accumulated other comprehensive income (loss) for the periods presented (in thousands):
Net Unrealized Gain From Available-For-Sale InvestmentsUnrealized Foreign Currency TranslationAccumulated Other Comprehensive Income
Balance at December 31, 2023
$124 $123 $247 
   Net unrealized gain on investments, net of tax(1)
437 — 437 
   Foreign currency translation adjustments— (6)(6)
Balance at September 30, 2024
$561 $117 $678 
Net Unrealized Loss From Available-For-Sale InvestmentsUnrealized Foreign Currency TranslationAccumulated Other Comprehensive
Loss
Balance at December 31, 2022
$(523)$143 $(380)
   Net unrealized gain on investments, net of tax (1)
362 — 362 
   Foreign currency translation adjustments— 8 8 
Balance at September 30, 2023
$(161)$151 $(10)
(1) Net of a $0.1 million tax benefit and $0.2 million tax expense for the nine months ended September 30, 2024 and 2023, respectively.
Share Repurchase Program
On May 7, 2024, the Company announced that its Board of Directors approved a share repurchase program, effective immediately, which authorizes the Company to repurchase up to an aggregate of $150.0 million of its outstanding common stock. Repurchases under this program may be made at management’s discretion on the open market or through privately negotiated transactions. The share repurchase program may be suspended or discontinued at any time by the Company and has an expiration date of December 31, 2026.
On May 9, 2024, concurrently with the pricing of the offering of the 2029 Notes, the Company entered into separate privately negotiated agreements with certain of the initial purchasers of the 2029 Notes or their respective affiliates and/or certain other financial institutions to repurchase 837,240 shares of the Company’s common stock for a total cost of $25.1 million, inclusive of $0.1 million of accrued excise tax. The repurchase occurred on May 10, 2024.
Repurchases of the Company’s common stock are accounted for at cost and recorded as treasury stock. The excise tax on repurchases of the Company’s common stock is recorded as a cost of acquiring treasury stock. Reissued treasury stock will be accounted for at average cost. Gains or losses on reissued treasury stock arising from the difference between the average cost and the fair value of the award will be recorded in additional paid-in capital.
NOTE 11—STOCK PLANS
Stock Incentive Plans
In April 2014, the Company’s board of directors approved and adopted the Company’s 2014 Inducement Plan (the “2014 Inducement Plan”), pursuant to which awards could be made to new employees under the 2014 Inducement Plan for up to 175,000 shares of the Company’s common stock as a material inducement to such persons entering into employment with the Company. In December 2023, the board of directors, upon recommendation of the compensation committee of the board of directors, adopted the Pacira BioSciences, Inc. Amended and Restated 2014 Inducement Plan (as amended and restated, the “Inducement Plan”) such that, among other things, an additional 642,093 shares of the Company’s common stock were reserved for issuance under the Inducement Plan. In September 2024, the board of directors again amended the Inducement Plan upon the recommendation of the compensation committee to add an additional 707,907 shares of the Company’s common stock to bring the total amount of shares reserved for issuance under the Inducement Plan to 1,525,000, of which 685,407 shares remain available for issuance, and the term of the Inducement Plan was extended such that it will now expire on September 3, 2034.

The Inducement Plan allows the granting of nonstatutory stock options, restricted stock awards and other stock-based awards.
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Stock-Based Compensation
The Company recognized stock-based compensation expense in the periods presented as follows (in thousands):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2024202320242023
Cost of goods sold$1,509 $1,272 $3,896 $4,432 
Research and development1,794 2,220 5,522 5,817 
Selling, general and administrative9,137 9,038 25,970 25,226 
Contingent consideration (gains) charges, restructuring charges and other790 — 3,517 — 
        Total$13,230 $12,530 $38,905 $35,475 
Stock-based compensation from:
    Stock options$4,767 $5,957 $17,292 $18,163 
    Restricted stock units8,276 6,373 21,003 16,592 
    Employee stock purchase plan187 200 610 720 
        Total$13,230 $12,530 $38,905 $35,475 
Equity Awards
The following tables contain information about the Company’s stock option and restricted stock unit, or RSU, activity for the nine months ended September 30, 2024:
Stock Options Number of
Stock Options		 Weighted Average Exercise Price (Per Share)
 Outstanding at December 31, 2023
7,079,748 $49.40 
     Granted1,164,323 30.87 
     Forfeited(240,232)45.52 
     Expired(1,108,285)61.72 
 Outstanding at September 30, 2024
6,895,554 44.42 
Restricted Stock Units Number of
Restricted
Stock Units		 Weighted Average Grant Date Fair Value (Per Share)
Unvested at December 31, 2023
1,364,618 $47.66 
     Granted1,936,065 28.82 
     Vested(461,715)49.33 
     Forfeited(239,810)39.41 
Unvested at September 30, 2024
2,599,158 33.90 
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The weighted average fair value of stock options granted during the nine months ended September 30, 2024 was $13.13 per share. The fair values of stock options granted were estimated using the Black-Scholes option valuation model with the following weighted average assumptions:
Black-Scholes Weighted Average AssumptionNine Months Ended September 30, 2024
Expected dividend yieldNone
Risk-free interest rate3.98%
Expected volatility40.8%
Expected term of options5.23 years
Employee Stock Purchase Plan
The Company’s Amended and Restated 2014 Employee Stock Purchase Plan, or ESPP, features two six-month offering periods per year, running from January 1 to June 30 and July 1 to December 31. Under the ESPP, employees may elect to contribute after-tax earnings to purchase shares at 85% of the closing fair market value of the Company’s common stock on either the offering date or the purchase date, whichever is lesser. During the nine months ended September 30, 2024, 56,077 shares were purchased and issued through the ESPP.
NOTE 12—NET (LOSS) INCOME PER COMMON SHARE
Basic net (loss) income per common share is calculated by dividing the net (loss) income attributable to common shares by the weighted average number of common shares outstanding during the period. Diluted net (loss) income per common share is calculated by dividing the net (loss) income attributable to common shares by the weighted average number of common shares outstanding plus dilutive potential common shares outstanding during the period.
Potential common shares include the shares of common stock issuable upon the exercise of outstanding stock options, the vesting of RSUs and the purchase of shares from the ESPP (using the treasury stock method), if applicable. Potential common shares associated with convertible senior notes are treated under the if-converted method. Adjustments are made to the diluted net (loss) income per common share calculation as if the Company had converted the convertible senior notes on the first day of each period presented. Adjustments to the numerator are made to add back the interest expense associated with the convertible senior notes on a post-tax basis. Adjustments to the denominator reflect the number of shares assumed to be convertible at the beginning of the period.
Potential common shares are excluded from the diluted net (loss) income per common share computation to the extent they would be antidilutive.
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The following table sets forth the computation of basic and diluted net (loss) income per common share for the three and nine months ended September 30, 2024 and 2023 (in thousands, except per common share amounts):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2024202320242023
Numerator:
   Net (loss) income—basic$(143,466)$10,858 $(115,601)$17,085 
2025 Notes if-converted method adjustment— 1,029 — — 
   Adjusted net (loss) income—diluted$(143,466)$11,887 $(115,601)$17,085 
Denominator:
   Weighted average common shares outstanding—basic46,134 46,416 46,269 46,151 
Computation of diluted securities:
2025 Notes if-converted method adjustment— 5,608 — — 
   Dilutive effect of stock options— 20 — 68 
   Dilutive effect of RSUs— 23 — 122 
Dilutive effect of ESPP purchase options— — — 2 
   Weighted average common shares outstanding—diluted46,134 52,067 46,269 46,343 
Net (loss) income per common share:
   Basic and diluted net (loss) income per common share$(3.11)$0.23 $(2.50)$0.37 
The following table summarizes the outstanding stock options, RSUs, ESPP purchase options and convertible senior notes that were excluded from the diluted net (loss) income per common share calculation because the effects of including these potential shares were antidilutive in the periods presented (in thousands):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2024202320242023
Weighted average number of stock options6,925 7,057 7,305 5,953 
2025 Notes2,821 — 4,184 5,608 
Weighted average number of RSUs2,637 1,349 1,935 956 
Weighted average ESPP purchase options47 39 51 13 
      Total12,430 8,445 13,475 12,530 
NOTE 13—INCOME TAXES
(Loss) income before income taxes and income tax expense are as follows (dollar amounts in thousands):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2024202320242023
(Loss) income before income taxes:
   Domestic$(140,309)$16,631 $(89,656)$29,047 
   Foreign1,453 (30)1,024 (1,066)
Total (loss) income before income taxes$(138,856)$16,601 $(88,632)$27,981 
Income tax expense$4,610 $5,743 $26,969 $10,896 
Effective tax rate(3)%35 %(30)%39 %
The Company’s income tax expense represents the estimated annual effective tax rate applied to the year-to-date domestic operating results adjusted for certain discrete tax items.
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The Company’s effective tax rate for the three months ended September 30, 2024 is primarily impacted by non-deductible goodwill impairment charges. The Company’s effective tax rate for the nine months ended September 30, 2024 is primarily impacted by non-deductible goodwill impairment charges and costs related to non-deductible stock-based compensation, mainly related to expired stock options.
The Company’s effective tax rate for the three and nine months ended September 30, 2023 includes costs related to non-deductible stock-based compensation and non-deductible executive compensation, partially offset by credits and a fair value adjustment for the contingent consideration.
As of September 30, 2024 and December 31, 2023, the Company has an income tax payable balance of $1.0 million that is included in other liabilities within the condensed consolidated balance sheets.
NOTE 14—CONTINGENT CONSIDERATION (GAINS) CHARGES, RESTRUCTURING CHARGES AND OTHER
Contingent consideration (gains) charges, restructuring charges and other for the three and nine months ended September 30, 2024 and 2023 summarized below (in thousands):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2024202320242023
Flexion contingent consideration$(3,244)$2,793 $(5,541)$(3,847)
Restructuring charges1,193 173 7,724 1,109 
Acquisition-related expenses285 390 689 1,588 
Total contingent consideration (gains) charges, restructuring charges and other$(1,766)$3,356 $2,872 $(1,150)
Flexion Acquisition Contingent Consideration
The Company recognized gains of $3.2 million and $5.5 million related to contingent consideration during the three and nine months ended September 30, 2024, respectively. The Company recognized a charge of $2.8 million and a gain of $3.8 million related to contingent consideration during the three and nine months ended September 30, 2023, respectively. See Note 9, Financial Instruments, for information regarding the method and key assumptions used in the fair value measurements of contingent consideration and more information regarding the changes in fair value.
Restructuring Charges
In February 2024, the Company initiated a restructuring plan to ensure it is well positioned for long-term growth. The restructuring plan includes: (i) reshaping the Company’s executive team, (ii) reallocating efforts and resources from the Company’s ex-U.S. and certain early-stage development programs to its commercial portfolio in the U.S. market and (iii) reprioritizing investments to focus on commercial readiness for the implementation of separate Medicare reimbursement for EXPAREL at average sales price plus 6 percent in outpatient settings and iovera° up to an additional $255.85 when providers administer iovera° in ambulatory surgical centers and outpatient settings beginning in January 2025 as part of the Non-Opioids Prevent Addiction In the Nation (“NOPAIN”) Act and broader commercial initiatives in key areas, such as strategic national accounts, marketing and market access and reimbursement. The Company recognized $1.2 million and $7.7 million of restructuring charges for the three and nine months ended September 30, 2024, respectively, related to employee termination benefits, such as the acceleration of share-based compensation, severance, and, to a lesser extent, other employment-related termination costs, as well as contract termination costs. The Company’s restructuring charges as of September 30, 2024, including the beginning and ending liability balances, are summarized below (in thousands):
Employee Termination Benefits (1)
Contract Termination CostsTotal
Balance at December 31, 2023$— $— $— 
Charges incurred3,169 1,038 4,207 
Cash payments made / settled(1,487)(20)(1,507)
Balances at September 30, 2024$1,682 $1,018 $2,700 
(1) During the three and nine months ended September 30, 2024, there was $0.8 million and $3.5 million, respectively, of employee termination benefits related to share-based compensation excluded from the table above as they are non-cash and recorded against additional paid-in capital.
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In June 2023, the Company implemented a restructuring plan in an effort to improve its operational efficiencies. The restructuring charges are predominantly related to one-time employee termination benefits through a reduction of headcount, such as severance and related costs. During the three and nine months ended September 30, 2023, the Company recognized restructuring charges of $0.2 million and $1.1 million, respectively.
Acquisition-Related Expenses
The Company recognized acquisition-related expenses of $0.3 million and $0.7 million during the three and nine months ended September 30, 2024, respectively. The Company recognized acquisition-related expenses of $0.4 million and $1.6 million during the three and nine months ended September 30, 2023, respectively. These costs primarily related to vacant and underutilized Flexion leases that were assumed from the Flexion Acquisition.
NOTE 15—COMMITMENTS AND CONTINGENCIES
From time to time, the Company has been and may again become involved in legal proceedings arising in the ordinary course of its business, including those related to its patents and intellectual property, product liability and government investigations. Except as described below, the Company is not presently a party to any legal proceedings that it believes to be material, and is not aware of any pending or threatened litigation against the Company which it believes could have a material adverse effect on its business, operating results, financial condition or cash flows.
MyoScience Milestone Litigation
In August 2020, the Company and its subsidiary, Pacira CryoTech, Inc. (“Pacira CryoTech”), filed a lawsuit in the Court of Chancery of the State of Delaware against Fortis Advisors LLC (“Fortis”), solely in its capacity as representative for the former securityholders of MyoScience, and certain other defendants, seeking declaratory judgment with respect to certain terms of the merger agreement for the MyoScience Acquisition (the “MyoScience Merger Agreement”), specifically related to the achievement of certain milestone payments under the MyoScience Merger Agreement. In addition, the Company and Pacira CryoTech sought general, special and compensatory damages against the other defendants related to breach of fiduciary duties in connection with the purported achievement of milestone payments under the MyoScience Merger Agreement, and breach of the MyoScience Merger Agreement and certain other agreements with the defendants. In October 2020, Fortis filed an answer and counterclaim against the Company and Pacira CryoTech seeking to recover certain milestone payments under the MyoScience Merger Agreement. The total remaining value of these milestones is $30.0 million, plus attorneys’ fees.
A trial was conducted in September 2023, and a decision is pending. The Company is unable to predict the outcome of this action at this time.
eVenus Pharmaceutical Laboratories Litigations
In October 2021, the Company received a Notice Letter advising that eVenus Pharmaceutical Laboratories, Inc., or eVenus, of Princeton, New Jersey, submitted to the FDA an Abbreviated New Drug Application, or ANDA with a Paragraph IV certification seeking authorization for the manufacturing and marketing of a generic version of EXPAREL (266 mg/20 mL) in the U.S. prior to the expiration of U.S. Patent No. 11,033,495 (the ‘495 patent).
In November 2021, the Company filed a patent infringement suit against eVenus and its parent company in the U.S. District Court for the District of New Jersey (21-cv-19829) asserting infringement of the ‘495 patent. This triggered an automatic 30-month stay of final approval of the eVenus ANDA which expired on July 1, 2024. On January 6, 2022, eVenus filed an Answer with counterclaims to the Complaint, alleging the ‘495 patent is invalid and/or not infringed through the manufacture, sale, or offer for sale of the product described in eVenus’s ANDA submission.
In December 2021, the Company received a second Notice Letter advising that eVenus submitted to the FDA an amendment to its ANDA with a Paragraph IV Certification seeking authorization for the manufacturing and marketing of a generic version of EXPAREL (133 mg/10 mL) in the U.S. prior to the expiration of the ‘495 patent. In the second Notice Letter, eVenus also advised that it submitted a Paragraph IV Certification to the FDA seeking authorization for the manufacturing and marketing of a generic version of EXPAREL (266 mg/20 mL and 133 mg/10 mL) in the U.S. prior to the expiration of U.S. Patent No. 11,179,336 (the ‘336 patent). eVenus further alleges in the Notice Letter that both the ‘495 patent and the ‘336 patent are invalid and/or not infringed.
In February 2022, the Company filed a second patent infringement suit against eVenus and its parent company in the U.S. District Court for the District of New Jersey (22-cv-00718) asserting that the 133 mg/10 mL ANDA product will infringe the ‘495 and ‘336 patents and that the 266 mg/20 mL ANDA product will infringe the ‘336 patent. This filing triggered a second automatic 30-month stay of final approval for the 133 mg/10 mL ANDA product which expired on July 1, 2024. The first and second patent infringement suits were consolidated.
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In February 2023, eVenus filed its first amended answer to the first amended complaint, alleging patent invalidity, non-infringement and inequitable conduct. The Company has denied the allegations in eVenus’s first amended answer. The Company has subsequently voluntarily dismissed its claims with respect to the ‘336 Patent. The trial on the remaining patent was conducted in February 2024, and in August 2024, the U.S. District Court for the District of New Jersey issued its ruling in the patent infringement suit for the ‘495 patent. The ruling found that claim 7 of the ‘495 patent is not valid on the grounds of obviousness and anticipation. A notice of appeal was filed in September 2024 and remains pending.
In April 2023, the Company filed a third patent infringement suit against eVenus, its parent company, and Fresenius Kabi USA, LLC, or Fresenius, in the U.S. District Court for the District of New Jersey (23-cv-2367) asserting that the 133 mg/10 mL and 266 mg/20 mL ANDA products will infringe U.S. Patent No. 11,426,348 (the ‘348 patent). In July 2023, eVenus filed its answer with claims for declaratory judgment, alleging patent invalidity, non-infringement and inequitable conduct with respect to the ‘348 patent as well as the Company’s other patents, U.S. Patent Nos. 11,278,494; 11,304,904; 11,311,486; 11,357,727 and 11,452,691. The parties have subsequently dismissed all patents other than the ‘348 patent from this litigation. This action has been stayed pending resolution of the appeal of the U.S. District Court’s ruling on the ‘495 patent.
In May 2024, the Company filed a fourth patent infringement suit against eVenus, its parent company and Fresenius in the U.S. District Court for the District of New Jersey (24-cv-6294) asserting that the 133 mg/10 mL and 266 mg/20 mL ANDA products will infringe U.S. Patent Nos. 11,819,574 (the ‘574 patent) and 11,819,575 (the ‘575 patent). The Company subsequently filed a First Amended Complaint alleging infringement only with respect to the ‘574 patent. The Defendants filed an answer and counterclaim on September 25, 2024, with counterclaims alleging non-infringement and invalidity of the ‘574 patent, invalidity of the ‘575 patent and U.S. Patent No. 11,925,706 (the ‘706 patent) and inequitable conduct with respect to the ‘574, ‘575 and ‘706 patents. This action is in the pleadings stage.
In July 2024, the Company filed a fifth patent infringement suit against eVenus, its parent company and Fresenius in the U.S. District Court for the District of New Jersey (24-cv-7680) asserting that the 133 mg/10 mL and 266 mg/20 mL ANDA products will infringe the ‘706 patent. The Company voluntarily filed a stipulation of dismissal without prejudice on September 9, 2024.
The Company is unable to predict the outcome of these litigations at this time.
In July 2024, eVenus received FDA approval of a generic version of EXPAREL—the Company’s bupivacaine liposome injectable suspension product.
Argentum Request for Ex Parte Reexamination of ‘495 Patent
On October 3, 2024, Argentum Pharmaceuticals LLC, or Argentum, filed a Request for Ex Parte Reexamination of the ‘495 patent. Specifically, Argentum alleged that claims 1, 7 and 8 of the ‘495 patent are obvious and cite to U.S. Patent No. 9,585,838 and the Physician’s Desk Reference in support of its allegation. The Company is unable to predict the outcome of this proceeding at this time.
Research Development Foundation
Pursuant to an agreement with the Research Development Foundation, or RDF, the Company was required to pay RDF a low single-digit royalty on the collection of revenues from certain products, for as long as certain patents assigned to the Company under the agreement remain valid. RDF has the right to terminate the agreement for an uncured material breach by the Company, in connection with its bankruptcy or insolvency or if it directly or indirectly opposes or disputes the validity of the assigned patent rights. The Company’s ‘495 patent was issued on June 15, 2021. Thereafter, RDF asserted that the issuance of that patent extends the Company’s royalty obligations under the agreement until 2041. The Company believes that the royalty period under the agreement ended on December 24, 2021 with the expiration of its U.S. Patent No. 9,585,838. Because of the disagreement over the interpretation of the agreement, in December 2021, the Company filed a declaratory judgment lawsuit in the U.S. District Court for the District of Nevada (21-cv-02241). The lawsuit seeks a declaration from the court that the Company owes no royalties to RDF with respect to its EXPAREL product after December 24, 2021.
On August 8, 2023, the U.S. District Court, District of Nevada, granted the Company’s motion for partial summary judgment in respect to the Company’s claim for a declaration that it no longer owes royalties for EXPAREL made under the 45-liter manufacturing process as of December 24, 2021. As a result, the Company expects to receive $14.5 million from RDF, representing the royalties that the Company paid to RDF under protest after December 24, 2021 for EXPAREL made from the 45-liter manufacturing process. Once it becomes probable that the settlement amount will be received, the Company will record a settlement gain within other operating income (expense), net in the condensed consolidated statement of operations. In November 2023, the U.S. District Court, District of Nevada conducted a mediation that did not result in a settlement. During the pendency of the remaining lawsuit, the Company will continue to pay royalties associated with the 200-liter EXPAREL
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manufacturing process to RDF under protest. A trial was conducted in September 2024. The Company is unable to predict the outcome of this action at this time.
Other Commitments and Contingencies
Pediatric Trial Commitments
The FDA, as a condition of EXPAREL approval, has required the Company to study EXPAREL for infiltration and as a brachial plexus block in pediatric patients. The Company was granted deferrals for the required pediatric trials until after the indications were approved in adults. Similarly, in Europe, the Company agreed with the European Medicines Agency, or EMA, on a Pediatric Investigation Plan as a prerequisite for submitting a Marketing Authorization Application (MAA) in the E.U. Despite the U.K.’s withdrawal from the E.U., the agreed pediatric plan is applicable in the U.K.
The Company received notification from the FDA that its pediatric studies requirement had been waived for the indications of brachial plexus interscalene and lower extremity nerve block to produce postsurgical regional analgesia in pediatric patients. The Company is still working with the FDA, EMA and Medicines and Healthcare Regulatory Agency (MHRA) to finalize the regulatory pathways for its remaining pediatric commitments.
Contingent Milestone Payments
Refer to Note 9, Financial Instruments, for information on potential contingent milestone payments related to the Flexion Acquisition.
PCRX-201
PCRX-201 (enekinragene inzadenovec), a novel, locally administered gene therapy product candidate that boosts cellular production of the anti-inflammatory protein interleukin-1 receptor antagonist (IL-1Ra) for treating OA pain in the knee, was added to the Company’s portfolio as part of the Flexion Acquisition in November 2021.
Prior to the Flexion Acquisition, in 2017, Flexion entered into an agreement with GQ Bio Therapeutics GmbH, or GQ Bio, to acquire the global rights to PCRX-201, a gene therapy product candidate. As part of the agreement, up to an aggregate of $56.0 million of payments could become due upon the achievement of certain development and regulatory milestones, including up to $4.5 million through initiation of a Phase 2 clinical trial and up to an additional $51.5 million in development and global regulatory approval milestone payments.
Also in 2017, in an agreement between The Baylor College of Medicine, or Baylor, and GQ Bio, the Company became the direct licensee of certain underlying Baylor patents and other proprietary rights related to PCRX-201. The license agreement grants the Company an exclusive, royalty-bearing, world-wide right and license under its patent and other proprietary rights directly related to PCRX-201. The license agreement with Baylor includes a low single-digit royalty on net product sales of PCRX-201. Milestone payments range from $0.1 million up to $0.6 million based on the completion of a Phase 1 FDA trial up to a Phase 3 clinical trial.
In February 2024, the FDA granted a Regenerative Medicine Advanced Therapy (RMAT) designation to PCRX-201 for the treatment of OA pain of the knee.
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Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management’s Discussion and Analysis of Financial Condition and Results of Operations is based upon our condensed consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States of America (GAAP) and in accordance with the rules and regulations of the United States Securities and Exchange Commission, or SEC.
This Quarterly Report on Form 10-Q and certain other communications made by us contain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the Private Securities Litigation Reform Act of 1995, including, without limitation, statements related to: our future outlook, our intellectual property and patent terms, our growth and future operating results and trends, our strategy, plans, objectives, expectations (financial or otherwise) and intentions, future financial results and growth potential, including our plans with respect to the repayment of our indebtedness, anticipated product portfolio, development programs, development of products, strategic alliances, plans with respect to the Non-Opioids Prevent Addiction in the Nation (“NOPAIN”) Act and any other statements that are not historical facts. For this purpose, any statement that is not a statement of historical fact should be considered a forward-looking statement. We often use the words “anticipate,” “believe,” “can,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “project,” “should,” “will,” “would” and similar expressions to help identify forward-looking statements. We cannot assure you that our estimates, assumptions and expectations will prove to have been correct. Actual results may differ materially from these indicated by such forward-looking statements as a result of various important factors, including risks relating to, among others: the integration of our new chief executive officer; risks associated with acquisitions, such as the risk that the businesses will not be integrated successfully, that such integration may be more difficult, time-consuming or costly than expected or that the expected benefits of the transaction will not occur; our manufacturing and supply chain, global and United States, or U.S., economic conditions (including inflation and rising interest rates), and our business, including our revenues, financial condition, cash flows and results of operations; the success of our sales and manufacturing efforts in support of the commercialization of EXPAREL® (bupivacaine liposome injectable suspension), ZILRETTA® (triamcinolone acetonide extended-release injectable suspension) and iovera°®; the rate and degree of market acceptance of EXPAREL, ZILRETTA and iovera°; the size and growth of the potential markets for EXPAREL, ZILRETTA and iovera° and our ability to serve those markets; our plans to expand the use of EXPAREL, ZILRETTA and iovera° to additional indications and opportunities, and the timing and success of any related clinical trials for EXPAREL, ZILRETTA and iovera°; the commercial success of EXPAREL, ZILRETTA and iovera°; the related timing and success of United States Food and Drug Administration, or FDA, supplemental New Drug Applications, or sNDAs, and premarket notification 510(k)s; the related timing and success of European Medicines Agency, or EMA, Marketing Authorization Applications, or MAAs; our plans to evaluate, develop and pursue additional product candidates utilizing our proprietary multivesicular liposome, or pMVL, drug delivery technology; the approval of the commercialization of our products in other jurisdictions; clinical trials in support of an existing or potential pMVL-based product; our commercialization and marketing capabilities; our ability to successfully complete capital projects; the outcome of any litigation; the ability to successfully integrate any future acquisitions into our existing business; the recoverability of our deferred tax assets; assumptions associated with contingent consideration payments; assumptions used for estimated future cash flows associated with determining the fair value of the Company and the anticipated funding or benefits of our share repurchase program.

Important factors could cause our actual results to differ materially from those indicated or implied by forward-looking statements, and as such we anticipate that subsequent events and developments will cause our views to change. Except as required by applicable law, we undertake no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, and readers should not rely on the forward-looking statements as representing our views as of any date subsequent to the date of the filing of this Quarterly Report on Form 10-Q.

These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from those expressed or implied by these statements. These factors include items mentioned herein and the matters discussed and referenced in Part I-Item 1A. “Risk Factors” included in our Annual Report on Form 10-K for the year ended December 31, 2023 (the “2023 Annual Report”) and in other reports as filed with the SEC.

Unless the context requires otherwise, references to “Pacira,” the “Company,” “our,” “us” and “we” in this Quarterly Report on Form 10-Q refer to Pacira BioSciences, Inc. and its subsidiaries.
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Overview
Pacira’s mission is to deliver innovative, non-opioid pain therapies to transform the lives of patients. Our long-acting, local analgesic EXPAREL® (bupivacaine liposome injectable suspension) utilizes our unique pMVL drug delivery technology that encapsulates drugs without altering their molecular structure and releases them over a desired period of time. In the U.S., EXPAREL is a long-acting, non-opioid option proven to manage postsurgical pain. EXPAREL is the only product indicated for local analgesia via infiltration in patients aged six years and older and regional analgesia via interscalene brachial plexus nerve block, sciatic nerve block in the popliteal fossa and adductor canal block in adults. In Europe, EXPAREL is approved as a brachial plexus block or femoral nerve block for treatment of post-operative pain in adults, and as a field block for treatment of somatic post-operative pain from small- to medium-sized surgical wounds in adults and children aged six years and older. Since its initial approval in 2011, more than 15 million patients have been treated with EXPAREL. We drop-ship EXPAREL directly to end-users based on orders placed to wholesalers or directly to us, and there is no product held by wholesalers. With the acquisition of Flexion Therapeutics, Inc., or Flexion, in November 2021 (the “Flexion Acquisition”), we acquired ZILRETTA® (triamcinolone acetonide extended-release injectable suspension), the first and only extended-release, intra-articular, or IA, injectable therapy that can provide major relief for osteoarthritis, or OA, knee pain for three months and has the potential to become an alternative to hyaluronic acid, platelet rich plasma injections or other early intervention treatments. With the acquisition of MyoScience, Inc., or MyoScience, in April 2019 (the “MyoScience Acquisition”), we acquired iovera°®, a handheld cryoanalgesia device used to deliver a precise, controlled application of cold temperature to targeted nerves, which we sell directly to end users. EXPAREL, ZILRETTA and iovera° are highly complementary products as long-acting, non-opioid therapies that alleviate pain. We are also advancing the development of PCRX-201 (enekinragene inzadenovec), a novel, locally administered gene therapy with the potential to treat large prevalent diseases like OA.
We expect to continue to pursue the expanded use of EXPAREL, ZILRETTA and iovera° in additional procedures; progress our earlier-stage product candidate pipeline; advance regulatory activities for EXPAREL, ZILRETTA, iovera°, PCRX-201 and our other product candidates; invest in sales and marketing resources for EXPAREL, ZILRETTA and iovera°; expand and enhance our manufacturing capacity for EXPAREL, ZILRETTA and iovera°; invest in products, businesses and technologies; and support legal matters.
Global Economic Conditions
Direct and indirect effects of global economic conditions have in the past, and may continue to, negatively impact our business, financial condition and results of operations. Such impacts may include the effect of prolonged periods of inflation which could, among other things, result in higher costs for labor, raw materials and services; cause patients to defer or cancel medical procedures, thereby adversely impacting our revenues; and negatively impact our suppliers which could result in longer lead-times or the inability to secure a sufficient supply of materials. The current macroeconomic environment remains dynamic and subject to rapid and possibly material changes. Additional negative impacts may also arise that we are unable to foresee. The nature and extent of such impacts will depend on future developments, which are highly uncertain and cannot be predicted.

Recent Highlights & Developments

•In August 2024, the U.S. District Court for the District of New Jersey issued its ruling in our patent infringement suit against eVenus Pharmaceutical Laboratories, Inc., or eVenus, and its parent company for infringement of EXPAREL U.S. Patent No. 11,033,495. The ruling found that this patent is not valid on the grounds of obviousness and anticipation. A notice of appeal was filed in September 2024 and remains pending.
We currently have four other patent infringement lawsuits pending against eVenus and its parent company and remain committed to vigorously defending our EXPAREL intellectual property for the benefit of our shareholders, patients and other stakeholders. With respect to an injunction, based on the information received through the ongoing court proceedings, we do not believe irreparable harm from an “at-risk” launch is imminent at this time.
For more information, see Note 15, Commitments and Contingencies, to our condensed consolidated financial statements included herein.
•In September 2024, we announced the upcoming presentation of new 104-week safety and efficacy data following local administration of our gene therapy candidate—PCRX-201 (enekinragene inzadenovec)—for moderate to severe OA of the knee. The data will be presented at the American College of Rheumatology’s annual ACR Convergence meeting, being held in Washington, D.C. November 14–19, 2024.
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•In October 2024, we announced that the Centers for Medicare and Medicaid Services, or CMS, has established a permanent product-specific Healthcare Common Procedure Coding System (HCPCS) J-code for EXPAREL. The new J-code for EXPAREL—J0666—becomes effective January 1, 2025, and will supersede the current C-code (C9290), which has been in place since 2019. In addition to the separate CMS reimbursement EXPAREL will receive in outpatient settings with the implementation of the NOPAIN Act in January 2025, this new J-code will also provide reimbursement when EXPAREL is used in the office setting and for office-based surgeries.
J-codes are reimbursement codes used by commercial insurance plans, Medicare, Medicare Advantage, and other government payers for Medicare Part B drugs like EXPAREL. Claims submission and payment are standardized with a J-code, facilitating and streamlining billing and reimbursement. In addition, some commercial insurers require a J-code for payment.
Additionally, in November 2024, CMS confirmed that both EXPAREL and iovera° qualify as eligible non-opioid pain management products under the NOPAIN Act. Hospital outpatient departments, or HOPDs, and ambulatory surgical centers, or ASCs, that use these products will receive additional Medicare reimbursement beginning January 1, 2025. The reimbursement rate for EXPAREL equates to 106% of the average sales price (ASP +6%) in the HOPD and ASC environments using the new product-specific J-code (J0666) beginning January 1, 2025. The separate reimbursement for iovera° will pay up to an additional $255.85 when providers administer iovera° in ASC and HOPD settings, using a new C-code created for the iovera° system (C9809). This new Medicare payment is provided in addition to the current reimbursement available to HOPDs and ASCs when they perform a procedure with the iovera° system.
•In October 2024, we appointed Shawn Cross as our Chief Financial Officer. Mr. Cross brings more than 25 years of experience as a biotechnology executive, board member and investment banker. Most recently, Mr. Cross served in executive positions of increasing responsibility at Applied Molecular Transport, Inc. where he was ultimately named Chief Executive Officer to lead their merger with Cyclo Therapeutics, Inc., where Mr. Cross currently serves on the Board of Directors. His biopharmaceutical investment banking career includes senior leadership roles at JMP Securities, Inc., Deutsche Bank Securities Inc. and Wells Fargo Securities, LLC.
EXPAREL

In the U.S., EXPAREL is currently indicated for local analgesia via infiltration in patients aged six years and older and regional analgesia via interscalene brachial plexus nerve block, sciatic nerve block in the popliteal fossa, and adductor canal block in adults. Safety and efficacy have not been established in other nerve blocks. In Europe, EXPAREL is approved as a brachial plexus block or femoral nerve block for treatment of post-operative pain in adults, and as a field block for treatment of somatic post-operative pain from small- to medium-sized surgical wounds in adults and children aged six years and older.

EXPAREL Label Expansion

•Expanding utilization in lower extremity nerve block indications. In February 2024, we launched EXPAREL in two key lower extremity nerve blocks—namely an adductor canal block and a sciatic nerve block in the popliteal fossa. We believe these two key nerve blocks will expand EXPAREL utilization within surgeries of the knee, lower leg, and foot and ankle procedures. The launch is supported by two successful head-to-head Phase 3 studies in which EXPAREL demonstrated four days of superiority to bupivacaine.

•Pediatrics. We have launched a Phase 1 pharmacokinetic study of EXPAREL as a single-dose post-surgical infiltration administration in patients under six years of age. If successful, we expect this study, followed by a Phase 3 registration study, will support expansion of the EXPAREL labels in the U.S., European Union, or E.U., and United Kingdom, or U.K. We are also discussing with the FDA, EMA and the Medicines and Healthcare Products Regulatory Agency (MHRA) our regulatory strategy for EXPAREL administered as a nerve block in the pediatric setting. We received notification from the FDA that our pediatric studies requirement had been waived for the indications of brachial plexus interscalene and lower extremity nerve block to produce postsurgical regional analgesia in pediatric patients.

EXPAREL Clinical Benefits

We believe EXPAREL can replace the use of bupivacaine delivered via elastomeric pumps as the foundation of a multimodal regimen for long-acting postsurgical pain management. Based on our clinical data, EXPAREL:
•provides long-lasting local or regional analgesia;
•is a ready-to-use formulation;
•expands easily with saline or lactated Ringer’s solution to reach a desired volume;
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•can be administered for local analgesia via infiltration and for regional analgesia via field block, as well as brachial plexus nerve block, sciatic nerve block in the popliteal fossa and adductor canal block; and
•facilitates treatment of a variety of surgical sites.
We believe EXPAREL is a key component of long-acting postsurgical pain management regimens that reduce the need for opioids. Based on the clinical data from our Phase 3 and Phase 4 clinical studies as well as data from retrospective health outcomes studies, EXPAREL significantly reduces opioid usage while improving postsurgical pain management.
ZILRETTA

ZILRETTA is the first and only extended-release, intra-articular therapy for OA knee pain. ZILRETTA employs a proprietary microsphere technology combining triamcinolone acetonide, or TA, a commonly administered, immediate-release corticosteroid, with a poly lactic-co-glycolic acid, or PLGA, matrix to provide extended pain relief. PLGA is a proven extended-release delivery vehicle that is metabolized to carbon dioxide and water as it releases drug in the intra-articular space and is used in other approved drug products and surgical devices. The ZILRETTA microspheres slowly and continuously release triamcinolone acetonide into the knee to provide significant pain relief for 12 weeks, with some people experiencing pain relief through 16 weeks. ZILRETTA was approved by the FDA in October 2017 and launched in the U.S. shortly thereafter.

We believe ZILRETTA’s extended-release profile may also provide effective treatment for OA pain of the shoulder and we recently launched a Phase 3 registration study to evaluate the safety and efficacy of ZILRETTA for the management of OA pain of the shoulder. If the study is successful, we plan to seek approval to expand the ZILRETTA label to include OA pain of the shoulder.

ZILRETTA Clinical Benefits

ZILRETTA combines TA, a commonly administered steroid, with a proprietary, extended-release microsphere technology to administer extended therapeutic concentrations in the joint and persistent analgesic effect.

Based on the strength of its pivotal and other clinical trials, we believe that ZILRETTA represents an important treatment option for the millions of patients in the U.S. in need of safe and effective extended relief from OA knee pain. The pivotal Phase 3 trial showed that ZILRETTA significantly reduced OA knee pain for 12 weeks, with some people experiencing pain relief through 16 weeks. We believe that ZILRETTA has the potential to become the corticosteroid of choice given its safety and efficacy profile, and the fact that it is the first and only extended-release corticosteroid on the market. In September 2021, the American Association of Orthopaedic Surgeons, or AAOS, updated its evidence-based clinical practice guidelines, finding ZILRETTA can improve patient outcomes over traditional immediate-release corticosteroids.

iovera°

The iovera° system is a non-opioid handheld cryoanalgesia device used to deliver precise, controlled doses of cold temperature to targeted nerves. It is FDA 510(k) cleared in the U.S., has a CE mark in the E.U. and is cleared for marketing in Canada for the blocking of pain. We believe the iovera° system is highly complementary to EXPAREL and ZILRETTA as a non-opioid therapy that alleviates pain using a non-pharmacological nerve block to disrupt pain signals being transmitted to the brain from the site of injury or surgery. It is also indicated for the relief of pain and symptoms associated with arthritis of the knee for up to 90 days.

iovera° Clinical Benefits

There is a growing body of clinical data demonstrating success with iovera° treatment for a wide range of chronic pain conditions. Some of our strongest data relates directly to the improvement of OA pain of the knee. In a pivotal trial evaluating iovera° for knee OA pain, the majority of the patients suffering from OA pain of the knee experienced pain relief up to 150 days after being treated with iovera°.
Surgical intervention is typically a last resort for patients suffering from knee OA pain. Treatment with iovera° has also demonstrated effectiveness for managing pain associated with knee replacements. Specifically, findings demonstrated reductions in opioids, including:

•The daily morphine equivalent consumption in the per protocol group analysis was significantly lower at 72 hours (p<0.05), 6 weeks (p<0.05) and 12 weeks (p<0.05).
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•Patients who were administered iovera° were far less likely to take opioids six weeks after surgery. The number of patients taking opioids six weeks after total knee arthroplasty, or TKA, in the control group was three times the number of patients taking opioids in the cryoanalgesia group (14 percent vs. 44 percent, p<0.01).
•Patients in the iovera° group demonstrated a statistically significant reduction in pain scores from their baseline pain scores at 72 hours (p<0.05) and at 12 weeks (p<0.05).
We believe these data validate iovera° as a clinically meaningful non-opioid alternative for patients with knee OA as well as those undergoing TKA, and that iovera° offers the opportunity to provide patients with non-opioid pain control well in advance of any necessary surgical intervention through a number of key product attributes:
•iovera° is safe and effective with immediate pain relief that can last for months as the nerve regenerates over time;
•iovera° is repeatable, with no diminishing effectiveness over time and repeat use;
•The iovera° technology does not risk damage to the surrounding tissue;
•iovera° is a convenient handheld device with a single-use procedure-specific Smart Tip; and
•iovera° can be delivered precisely using imaging guidance or an anatomical landmark.
A study published in 2021 that included 267 patients undergoing TKA (169 who underwent cryoneurolysis with iovera° compared to 98 patients who did not receive iovera° treatment) showed that patients who were treated with iovera° had 51% lower daily morphine milligram equivalents during their hospital stay and a 22% lower mean pain score versus those who were not. In addition, the iovera° group had greater function at discharge, a shorter length of hospital stay and received significantly fewer opioids, including discharge prescriptions at week 2 and week 6 after surgery.
In September 2021, the AAOS updated its evidence-based clinical practice guidelines, reporting that denervation therapy—including cryoneurolysis—may reduce knee pain and improve function in patients with symptomatic OA of the knee.
We are currently sponsoring a prospective, real-world registry called the Innovations in Genicular Outcomes Registry, or iGOR, which is a patient focused registry governed in collaboration with a steering committee of scientific experts that evaluates clinical, economic- and health-related patient-reported outcomes in patients who have received any treatment for knee OA pain, including TKA, for a minimum of 18 months. A unique feature of iGOR is that if patients receive additional treatments for OA, data capture resets so outcomes of their treatment journey can be followed over multiple years. Unlike in clinical studies, treatment decisions in iGOR are decided by physicians and patients in a shared decision-making manner rather than being driven by treatment assignment, so that outcomes are truly those from real-world applications. The iGOR registry is tracking outcomes of iovera°, ZILRETTA and EXPAREL, as well as comparator treatments. Early outcomes from iGOR have shown that patients who receive iovera° prior to TKA have less pain, improved function and improved sleep for six months after surgery versus patients who do not receive iovera°.
In addition, a pilot randomized control trial evaluating iovera° for the treatment of lower back pain showed that it had significantly greater improvements in pain and disability, and required fewer injections over a year, compared to patients who were treated with radiofrequency ablation. This data supports the development of a longer Smart Tip that is currently underway which would allow for broader use of iovera° for the treatment of lower back pain.
Beyond treatment for pain, observational data has been presented at multiple congresses showing effectiveness of iovera° for the treatment of upper limb spasticity over 90 days by targeting motor nerves. We currently have a pivotal trial underway to demonstrate the efficacy and safety of iovera° for treating spasticity.

The Osteoarthritis Market

OA is the most common form of arthritis. It is also called degenerative joint disease and occurs most frequently in the hands, hips and knees. With OA, the cartilage within a joint begins to break down and the underlying bone begins to change. These changes usually develop slowly and worsen over time. OA can cause pain, stiffness and swelling. In some cases, it also causes reduced function and disability—some people are no longer able to do daily tasks or work. According to the Centers for Disease Control and Prevention (CDC), OA affects over 32.5 million adults in the U.S.
The lifetime risk of developing symptomatic knee OA is 45 percent according to the Arthritis Foundation. The prevalence of symptomatic knee OA increases with each decade of life, with the annual incidence of knee OA being highest between age 55 and 64 years old. There are 14 million individuals in the U.S. who have symptomatic knee OA, and nearly two million are under the age of 45. Surgical intervention is typically a last resort for patients suffering from OA of the knee.
With ZILRETTA, we now offer clinicians the flexibility to individualize OA knee pain treatment with either ZILRETTA or a drug-free nerve block with iovera° based on patient factors and preference, physician training, site of care and reimbursement considerations.
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Clinical Development Programs

PCRX-201

PCRX-201 (enekinragene inzadenovec) is our novel gene therapy in clinical development as a treatment for osteoarthritis of the knee. Its innovative high-capacity adenovirus, or HCAD, design, manufacturing process, and local administration may solve many of the challenges that have made gene therapy inaccessible for common diseases like osteoarthritis. Key features that support the use of PCRX-201 for a prevalent disease:
•The HCAD viral vector is more efficient at delivering genes into cells than other vectors, which means we can achieve the desired effect with smaller doses.
•PCRX-201 is delivered where it matters—it is injected locally into the knee joint capsule and contained there for a favorable clinical and safety profile, whereas if administered systemically, a much higher dose would be needed to reach the knee and achieve the desired effect.
•Smaller doses, local administration, and scalable manufacturing result in an attractive cost of goods profile versus other gene therapies.
After injection, the HCAD vector enters joint cells and turns them into factories to boost cellular IL-1Ra production, which blocks IL-1 pathway activation to reduce inflammation and pain in the knee. PCRX-201 uses an inflammation-responsive promoter to only produce IL-1Ra when needed, mimicking how the body naturally responds to inflammation. In a Phase 1 proof-of-concept study of patients with moderate to severe OA of the knee, PCRX-201 was well tolerated with improvements in knee pain observed across all doses. The study enrolled 72 patients in two three-dose cohorts: a co-administered IA steroid cohort and a cohort that did not receive a steroid. PCRX-201 was well tolerated, with efficacy observed through at least 52 weeks at all doses and cohorts. The highest level of efficacy was achieved in the co-administered steroid group, which showed a greater percentage of patients with at least a 50% improvement in Western Ontario and McMaster Universities Osteoarthritis Index (WOMAC) pain and stiffness scores, as well as a meaningful improvement in (Knee Injury and Osteoarthritis Outcomes Score) KOOS functional assessment. The one-year data were presented at the Osteoarthritis Research Society International (OARSI) 2024 World Congress in April 2024. We now have two-year efficacy and safety data that we have submitted for presentation at the American College of Rheumatology’s annual ACR Convergence meeting in November 2024. While other therapies typically provide relief for three to six months, PCRX-201 has already set a new standard with a year or more of sustained pain relief from a single injection. Given these highly encouraging Phase 1 data, we are preparing to launch a Phase 2 clinical study in knee OA in 2025.

In February 2024, the FDA granted PCRX-201 a Regenerative Medicine Advanced Therapy, or RMAT, designation. Established under the 21st Century Cures Act, RMAT designation is a dedicated program designed to expedite the development and review processes for promising therapies, including genetic therapies, that are intended to treat, modify, reverse or cure a serious or life-threatening disease or condition, and for which preliminary clinical evidence indicates that the drug or therapy has the potential to address an unmet medical need. PCRX-201 is the first gene therapy product candidate to receive RMAT designation for OA.
External Innovation
In parallel to our internal clinical programs, we are pursuing innovative acquisition targets that are complementary to EXPAREL, ZILRETTA and iovera° and are of great interest to the surgical and anesthesia audiences we are already calling on today. We are using a combination of strategic investments, in-licensing and acquisition transactions to buildout a pipeline of innovation to improve patients’ journeys along the neural pain pathway. The strategic investments we have made to support promising early-stage platforms are summarized below:

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CompanyDevelopment StageDescription of Platform TechnologyPotential Therapeutic Areas
CarthroniX, Inc.Phase 1-ReadyCX-011, a small molecule modulator of gp130 formulated as an IA injection designed to slow joint degeneration by mediating IL-6 cytokinesKnee OA
Genascence CorporationPhase 1b
Adeno-associated virus (AAV) based gene therapy engineered to deliver Interleukin-1 Receptor Antagonist (IL-1Ra) to target cells in joint(s)
Knee OA
GQ Bio Therapeutics GmbHPreclinical
High-capacity adenovirus (HCAd) based gene therapy engineered to deliver DNA to target cells in joint(s) and intervertebral disc(s)
Knee OA and degenerative disc disease (DDD)
Spine BioPharma, LLCPhase 3
SB-01, a 7-amino acid chain peptide that binds to and induces down regulation of transforming growth factor, beta 1 (TGFβ1)
Degenerative disc disease (DDD)

Product Portfolio and Internal Pipeline

Our current product portfolio and internal product candidate pipeline, along with anticipated milestones over the next 12 to 18 months, are summarized in the table below:

Q3ProductPipeline.jpg

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Pacira Training Facilities

We maintain and operate two Pacira Innovation and Training, or PIT, facilities—one in Tampa, Florida and one in Houston, Texas. These sites were constructed with a singular goal in mind: to advance education on best practice techniques to effectively manage acute pain while reducing or eliminating the need for opioids. These facilities provide clinicians with flexible, state-of-the-art environments for interactive, hands-on instruction on the latest and most innovative local, regional and field block approaches for managing pain, improving patient care and enabling patient migration to the 23-hour stay environment. Each of our PIT facilities feature distinct training spaces, including simulation labs equipped with ultrasound scanning stations; lecture halls that feature liquid crystal display video walls to support live, virtual and global presentations; and green-screen broadcast studios to livestream content with single or multiple hosts. The PIT of Houston has both wet and dry lab space for cadaver and other interactive workshops. The PIT of Tampa also houses our principal executive offices and corporate headquarters.
Results of Operations
Comparison of the Three and Nine Months Ended September 30, 2024 and 2023
Revenues
Net product sales consist of sales of (i) EXPAREL in the U.S., E.U., and U.K.; (ii) ZILRETTA in the U.S.; (iii) iovera° in the U.S., Canada and Europe and (iv) sales of our bupivacaine liposome injectable suspension for veterinary use. Royalty revenues are related to a collaborative licensing agreement from the sale of our bupivacaine liposome injectable suspension for veterinary use.
The following table provides information regarding our revenues during the periods indicated, including percent changes (dollar amounts in thousands):
Three Months Ended
September 30,		% Increase / (Decrease)Nine Months Ended
September 30,		% Increase / (Decrease)
2024202320242023
Net product sales:
EXPAREL$132,004 $128,667 3%$401,286 $394,202 2%
ZILRETTA28,420 28,798 (1)%84,966 82,393 3%
iovera°5,655 5,260 8%16,359 13,645 20%
Bupivacaine liposome injectable suspension1,643 858 91%7,322 2,241 100% +
Total net product sales167,722 163,583 3%509,933 492,481 4%
Royalty revenue851 343 100% +3,780 1,253 100% +
Total revenues$168,573 $163,926 3%$513,713 $493,734 4%
EXPAREL revenue increased 3% and 2% in the three and nine months ended September 30, 2024 versus 2023, respectively. Components of the increases included a 3% increase in gross vial volume in both the three and nine months ended September 30, 2024 versus 2023, which was offset by a shift in vial mix. EXPAREL revenue was also impacted by a 1% increase in selling price per unit in both periods related to a January 2024 price increase, net of increases in sales related allowances as a result of group purchasing organization contracting.
ZILRETTA revenue decreased 1% in the three months ended September 30, 2024 versus 2023 due to a 6% decrease in kit volume, partially offset by a 5% increase in net selling price per unit. ZILRETTA revenue increased 3% in the nine months ended September 30, 2024 versus 2023 due to a 5% increase in net selling price per unit, partially offset by a 2% decrease in kit volume. The increase in net selling price per unit is related to January and July 2024 price increases and favorable sales related allowances.
Net product sales of iovera° increased 8% and 20% in the three and nine months ended September 30, 2024 versus 2023, respectively, primarily due to respective increases of 9% and 23% in Smart Tip volume, partially offset by increased sales related allowances and accruals.
Bupivacaine liposome injectable suspension revenue increased 91% and by more than 100% in the three and nine months ended September 30, 2024 versus 2023, respectively. Its related royalties increased more than 100% in both the three and nine
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months ended September 30, 2024 versus 2023 primarily due to the sales mix of vial sizes and the timing of orders placed for veterinary use.
The following tables provide a summary of activity with respect to our sales related allowances and accruals related to EXPAREL and ZILRETTA for the nine months ended September 30, 2024 and 2023 (in thousands):
September 30, 2024Returns
Allowances		Prompt
Payment
Discounts		Service
Fees		Volume
Rebates and
Chargebacks		Government
Rebates		Total
Balance at December 31, 2023$1,868 $1,308 $3,697 $5,870 $1,175 $13,918 
Provision1,409 9,260 15,109 81,037 1,955 108,770 
Payments / Adjustments(1,975)(9,360)(14,973)(82,770)(1,090)(110,168)
Balance at September 30, 2024$1,302 $1,208 $3,833 $4,137 $2,040 $12,520 
September 30, 2023Returns
Allowances		Prompt
Payment
Discounts		Service
Fees		Volume
Rebates and
Chargebacks		Government
Rebates		Total
Balance at December 31, 2022$1,691 $1,187 $3,193 $5,452 $786 $12,309 
Provision1,710 8,835 13,414 69,982 1,588 95,529 
Payments / Adjustments(1,287)(8,874)(13,218)(68,676)(1,460)(93,515)
Balance at September 30, 2023$2,114 $1,148 $3,389 $6,758 $914 $14,323 
Total reductions of gross product sales from sales-related allowances and accruals were $108.8 million and $95.5 million, or 17.6% and 16.3% of gross product sales, for the nine months ended September 30, 2024 and 2023, respectively. The overall 1.3% increase in sales-related allowances and accruals as a percentage of gross product sales was primarily related to accruals as a result of higher chargeback-related allowances from expanded contracting efforts.
Cost of Goods Sold
Cost of goods sold primarily relates to the costs to produce, package and deliver our products to customers. These expenses include labor, raw materials, manufacturing overhead and occupancy costs, depreciation of facilities, royalty payments, quality control and engineering.
The following table provides information regarding our cost of goods sold and gross margin during the periods indicated, including percent changes (dollar amounts in thousands):
Three Months Ended
September 30,		% Increase / (Decrease)Nine Months Ended
September 30,		% Increase / (Decrease)
2024202320242023
 Cost of goods sold$38,864$39,750(2)%$130,542$136,977(5)%
 Gross margin77 %76 %75 %72 %
Gross margin increased one percentage-point in the three months ended September 30, 2024 versus 2023 primarily due to favorable ZILRETTA gross margins as the prior period included costs for a new fill line, partially offset by higher EXPAREL royalty expense. We continue to pay royalties associated with the 200-liter EXPAREL manufacturing process to the Research Development Foundation under protest. For more information, see Note 15, Commitments and Contingencies, to our condensed consolidated financial statements included herein.
Gross margin increased three percentage-points in the nine months ended September 30, 2024 versus 2023 primarily due to lower EXPAREL product cost as a result of higher production volumes and the absence of ZILRETTA step-up of fixed assets to fair value in accordance with purchase accounting that existed in the prior period, partially offset by higher ZILRETTA inventory reserves.
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Research and Development Expenses
Research and development expenses primarily consist of costs related to clinical trials and related outside services, product development and other research and development costs, including trials that we are conducting to generate new data for EXPAREL, ZILRETTA and iovera°, clinical trials for PCRX-201 and stock-based compensation expense. Clinical and preclinical development expenses include costs for clinical personnel, clinical trials performed by third-parties, toxicology studies, materials and supplies, database management and other third-party fees. Product development and manufacturing capacity expansion expenses include development costs for our products and PCRX-201, which include personnel, research equipment, materials and contractor costs for process development and product candidates, development costs related to significant scale-ups of our manufacturing capacity and facility costs for our research space. Regulatory and other expenses include regulatory activities related to unapproved products and indications, medical information and scientific communication expenses, expenses related to our iGOR registry study and related personnel. Stock-based compensation expense relates to the costs of stock option grants, awards of restricted stock units, or RSUs, and our employee stock purchase plan, or ESPP.
The following table provides a breakout of our research and development expenses during the periods indicated, including percent changes (dollar amounts in thousands):
Three Months Ended
September 30,		% Increase / (Decrease)Nine Months Ended
September 30,		% Increase / (Decrease)
2024202320242023
Clinical and preclinical development$8,215$6,80821%$22,733$17,26332%
Product development and manufacturing capacity expansion7,2399,419(23)%21,95226,396(17)%
Regulatory and other1,8562,383(22)%7,4737,3182%
Stock-based compensation1,7942,220(19)%5,5225,817(5)%
Total research and development expense$19,104$20,830(8)%$57,680$56,7942%
 % of total revenues11 %13 %11 %12 %
Total research and development expense decreased 8% in three months ended September 30, 2024 versus 2023 and increased 2% in the nine months ended September 30, 2024 versus 2023.
Clinical and preclinical development expense increased 21% and 32% in the three and nine months ended September 30, 2024 versus 2023, respectively, due to site start-up of and ongoing enrollment in a ZILRETTA shoulder trial, an EXPAREL pediatric trial and an iovera° spasticity trial. For the three months ended September 30, 2024 versus 2023, these increases were partially offset by the completion of the EXPAREL intrathecal trial cohort 2 enrollment. For the nine months ended September 30, 2024 versus 2023, these increases were partially offset by the winding down of a PCRX-201 Phase 1 trial for knee OA as two-year follow-up visits of subjects were completed in November 2023. This Phase 1 trial remains on track for completion by November 2026, the last year of the follow-up period for the last patient dosed. In addition, toxicology studies for product candidates were completed in 2023.
Product development and manufacturing capacity expansion expense decreased 23% and 17% in the three and nine months ended September 30, 2024 versus 2023, respectively, primarily attributable to the completion of pre-commercial scale-up activities of our EXPAREL manufacturing capacity at our Science Center Campus in San Diego, California, which the FDA approved an sNDA for our 200-liter EXPAREL manufacturing suite in February 2024. This new suite was subsequently placed into service in July 2024. The decrease was partially offset by ongoing product development costs related to PCRX-201 and an iovera° medial branch Smart Tip.
Regulatory and other expense decreased 22% in the three months ended September 30, 2024 versus 2023, due to the reduction of international regulatory activities and headcount vacancies, partially offset by increased enrollment and additional sites related to an observational registry study which track patients’ symptoms and experience with pain management related to OA of the knee. Regulatory and other expense increased 2% in the nine months ended September 30, 2024 versus 2023, due to increased enrollment and additional sites related to an observational registry study, partially offset by the reduction of international regulatory activities and headcount vacancies.
Stock-based compensation decreased 19% and 5% in the three and nine months ended September 30, 2024 versus 2023, respectively, primarily due to fewer equity awards granted to research and development personnel and headcount vacancies.
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Selling, General and Administrative Expenses
Sales and marketing expenses primarily consist of compensation and benefits for our sales force and personnel that support our sales, marketing, medical and scientific affairs operations, expenses related to communicating the health outcome benefits of our products, investments in provider-level market access and patient reimbursement support and educational programs for our customers. General and administrative expenses consist of compensation and benefits for legal, finance, regulatory activities related to approved products and indications, compliance, information technology, human resources, business development, executive management and other supporting personnel. It also includes professional fees for legal, audit, tax and consulting services. Stock-based compensation expense relates to the costs of stock option grants, RSU awards and our ESPP.
The following table provides information regarding our selling, general and administrative expenses during the periods indicated, including percent changes (dollar amounts in thousands):
Three Months Ended
September 30,		% Increase / (Decrease)Nine Months Ended
September 30,		% Increase / (Decrease)
2024202320242023
Sales and marketing$43,191$38,26113%$121,673$117,3024%
General and administrative22,00520,6487%66,84261,1129%
Stock-based compensation9,1379,0381%25,97025,2263%
Total selling, general and administrative expense$74,333$67,9479%$214,485$203,6405%
 % of total revenues44 %41 %42 %41 %
Total selling, general and administrative expense increased 9% and 5% in the three and nine months ended September 30, 2024 versus 2023, respectively.
Sales and marketing expense increased 13% and 4% in the three and nine months ended September 30, 2024 versus 2023. The three and nine months increase was driven by investing in programs to drive awareness and education for our customers and enhance our marketing, market access and reimbursement teams and value creation for the implementation of separate Medicare reimbursement for EXPAREL at average sales price plus 6 percent in HOPD settings and iovera° at up to an additional $255.85 when providers administer iovera° in ASC and HOPD settings beginning in January 2025 as part of the NOPAIN Act. We expect investments in these programs to continue through the end of 2024 as we have launched our national campaign—Make the NOPAIN Pact—which targets hospital pharmacists, administrators, clinicians and revenue management teams and is focused on ensuring these audiences are ready for the commencement of the NOPAIN Act. The three and nine months ended September 30, 2024 versus 2023 also benefited from a grant to the American Society of Anesthesiologists Charitable Foundation that occurred in the prior periods. These increases were partially offset by the impact of a February 2024 restructuring program.
General and administrative expense increased 7% and 9% in the three and nine months ended September 30, 2024 versus 2023, respectively. The three month increase in legal expenses was mostly driven by ongoing litigation and an increase in personnel related expenses. The nine month increase was primarily driven by third-party management consulting to assess strategic opportunities and market assessments for our products and compensatory costs associated with the transition to our new Chief Executive Officer effective January 2, 2024, which include compensation related to the current Chief Executive Officer and to the former Chief Executive Officer who remains an advisor to the Company in a consulting capacity.
For more information on our ongoing litigation, see Note 15, Commitments and Contingencies, to our condensed consolidated financial statements included herein.
Stock-based compensation increased 1% and 3% for the three and nine months ended September 30, 2024 versus 2023, respectively, primarily due to greater equity awards granted to personnel.
Amortization of Acquired Intangible Assets
The following table provides a summary of the amortization of acquired intangible assets during the periods indicated, including percent changes (dollar amounts in thousands):
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Three Months Ended
September 30,		% Increase / (Decrease)Nine Months Ended
September 30,		% Increase / (Decrease)
2024202320242023
Amortization of acquired intangible assets$14,322 $14,322 —%$42,966 $42,966 —%
As part of the Flexion Acquisition and the MyoScience Acquisition, we acquired intangible assets consisting of developed technology intangible assets and customer relationships, with estimated useful lives between 9 and 14 years. For more information, see Note 7, Goodwill and Intangible Assets, to our condensed consolidated financial statements included herein.
Goodwill Impairment
The following table provides a summary of goodwill impairments during the periods indicated, including percent changes (dollar amounts in thousands):
Three Months Ended
September 30,		% Increase / (Decrease)Nine Months Ended
September 30,		% Increase / (Decrease)
2024202320242023
Goodwill impairment$163,243 $— N/A$163,243 $— N/A
During the three months ended September 30, 2024, the FDA approved a generic competitor to EXPAREL and a U.S. District Court ruled that one of our patents was not valid (for more information, see Note 15, Commitments and Contingencies, to our condensed consolidated financial statements included herein). Due to these events and a subsequent decrease in our common stock price, it was determined these qualitative factors indicated it was more likely than not that the fair value of goodwill may be less than its carrying value. Accordingly, we performed a quantitative assessment through a discounted cash flow model (or income approach), which resulted in the carrying value of the Company exceeding its fair value by more than the goodwill balance. As a result, the goodwill balance of $163.2 million was recorded as fully impaired during the three months ended September 30, 2024.
Contingent Consideration (Gains) Charges, Restructuring Charges and Other
The following table provides a summary of the costs related to the contingent consideration, acquisition-related charges and restructuring charges during the periods indicated, including percent changes (dollar amounts in thousands):
Three Months Ended
September 30,		% Increase / (Decrease)Nine Months Ended
September 30,		% Increase / (Decrease)
2024202320242023
Flexion contingent consideration$(3,244)$2,793 N/A$(5,541)$(3,847)44%
Restructuring charges1,193 173 100% +7,724 1,109 100% +
Acquisition-related expenses285 390 (27)%689 1,588 (57)%
Total contingent consideration (gains) charges, restructuring charges and other$(1,766)$3,356 N/A$2,872 $(1,150)N/A
Total contingent consideration (gains) charges, restructuring charges and other for the three and nine months ended September 30, 2024 included gains of $1.8 million and charges of $2.9 million, respectively. Total contingent consideration (gains) charges, restructuring charges and other for the three and nine months ended September 30, 2023 included charges of $3.4 million and gains of $1.2 million, respectively.
During the three and nine months ended September 30, 2024, we recognized a contingent consideration gain of $3.2 million and $5.5 million, respectively, primarily due to adjustments reflecting the probability of achieving the remaining Flexion regulatory milestone by the milestone expiration date, partially offset by revisions to the latest discount rates.
During the three months ended September 30, 2023, we recognized contingent consideration charges of $2.8 million primarily due to market volatility which affects the liability’s present value. During the nine months ended September 30, 2023, we recognized gains of $3.8 million primarily due to adjustments to long-term forecasts which reduced the probability of meeting the Flexion sales-based contingent consideration milestones by December 31, 2030, the expiration date for achieving
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the milestones. The gains recognized during the nine months ended September 30, 2023 were partially offset by a decrease in the assumed discount rate that is utilized in calculating the liability’s present value, based on a significant improvement in our incremental borrowing rate resulting from the TLA Credit Agreement (as defined below) entered into in March 2023.
In February 2024, we initiated a restructuring plan to ensure that we are well positioned for long-term growth. The restructuring plan included, among other things: (i) reshaping the Company’s executive team; (ii) reallocating efforts and resources from our ex-U.S. and certain early-stage development programs to our commercial portfolio in the U.S. market; and (iii) reprioritizing investments to focus on other commercial initiatives. As a result, during the three and nine months ended September 30, 2024, we recognized restructuring charges of $1.2 million and $7.7 million, respectively, related to employee termination benefits, such as the acceleration of share-based compensation, severance, and, to a lesser extent, other employment-related termination costs, as well as contract termination costs.
During the three and nine months ended September 30, 2023, we implemented a restructuring plan in an effort to improve our operational efficiencies and recognized $0.2 million and $1.1 million, respectively, in one-time employee termination benefits through a reduction of headcount.
During the three and nine months ended September 30, 2024, we recognized acquisition-related expenses of $0.3 million and $0.7 million, respectively. During the three and nine months ended September 30, 2023, we recognized acquisition-related expenses of $0.4 million and $1.6 million, respectively. These costs primarily related to vacant and underutilized Flexion leases that were assumed from the Flexion Acquisition
For more information, see Note 9, Financial Instruments and Note 14, Contingent Consideration (Gains) Charges, Restructuring Charges and Other, to our condensed consolidated financial statements included herein.
Other Income (Expense), Net
The following table provides information regarding other income (expense), net during the periods indicated, including percent changes (dollar amounts in thousands):
Three Months Ended
September 30,		% Increase / (Decrease)Nine Months Ended
September 30,		% Increase / (Decrease)
2024202320242023
Interest income$5,482 $2,766 98%$14,134 $8,019 76%
Interest expense(4,689)(3,464)35%(11,889)(16,918)(30)%
Gain (loss) on early extinguishment of debt— — —%7,518 (16,926)N/A
Other, net(122)(422)(71)%(320)(701)(54)%
Total other income (expense), net$671 $(1,120)N/A$9,443 $(26,526)N/A
Total other income, net was $0.7 million and $9.4 million in the three and nine months ended September 30, 2024, respectively. Total other expense, net was $1.1 million and $26.5 million in the three and nine months ended September 30, 2023, respectively.
The substantial increases in interest income in the three and nine months ended September 30, 2024 versus 2023 were due to higher overall investment balances.
The 35% increase in interest expense during the three months ended September 30, 2024 versus 2023 was primarily driven by the issuance of the 2029 Notes (as defined below) in May 2024. The 30% decrease in interest expense during the nine months ended September 30, 2024 versus 2023 was primarily driven by the lower outstanding principal associated with the TLA Term Loan (as defined below) that was entered into on March 31, 2023 which replaced our then-outstanding TLB Term Loan (as defined below) that had a higher principal balance and interest rate, partially offset by issuing the 2029 Notes in May 2024.
In the nine months ended September 30, 2024, we recognized a $7.5 million gain on early extinguishment of debt in conjunction with the repurchase of $200.0 million aggregate principal of our 2025 Notes (as defined below). The partial repurchase of the 2025 Notes was completed with our net proceeds from the issuance of the 2029 Notes (as defined below).
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In the nine months ended September 30, 2023, in conjunction with the entry into the TLA Credit Agreement, we incurred a $16.9 million loss on early extinguishment of debt as a result of the retirement of $287.5 million aggregate principal of our TLB Term Loan (as defined below).
For more information, see Note 8, Debt, to our condensed consolidated financial statements included herein.
Income Tax Expense
The following table provides information regarding our income tax expense during the periods indicated, including percent changes (dollar amounts in thousands):
Three Months Ended
September 30,		% Increase / (Decrease)Nine Months Ended
September 30,		% Increase / (Decrease)
2024202320242023
 Income tax expense$4,610$5,743(20)%$26,969$10,896100% +
 Effective tax rate (3)%35 %(30)%39 %
The effective tax rates were (3)% and (30)% for the three and nine months ended September 30, 2024, respectively. The effective tax rates were 35% and 39% for the three and nine months ended September 30, 2023, respectively. Income tax expense represents the estimated annual effective tax rate applied to the year-to-date domestic operating results adjusted for certain discrete tax items.
The effective tax rate for the three months ended September 30, 2024 is primarily impacted by non-deductible goodwill impairment charges. The effective tax rate for the nine months ended September 30, 2024 is primarily impacted by non-deductible goodwill impairment charges and costs related to non-deductible stock-based compensation, mainly related to expired stock options.
The effective tax rates for the three and nine months ended September 30, 2023 include costs related to non-deductible stock-based compensation and non-deductible executive compensation, partially offset by credits and a fair-value adjustment for the contingent consideration.
Liquidity and Capital Resources
Since our inception in 2006, we have devoted most of our cash resources to manufacturing, research and development and selling, general and administrative activities related to the development and commercialization of EXPAREL. In addition, we acquired ZILRETTA as part of the Flexion Acquisition in November 2021 and iovera° as part of the MyoScience Acquisition in April 2019. We are primarily dependent on the commercial success of EXPAREL and ZILRETTA. We have financed our operations primarily with the proceeds from the sale of convertible senior notes and other debt, common stock, product sales and collaborative licensing and milestone revenue. As of September 30, 2024, we had an accumulated deficit of $222.4 million, cash and cash equivalents and available-for-sale investments of $453.8 million and working capital of $383.6 million.
We expect that our cash and cash equivalents and available-for-sale investments on hand will be adequate to cover our short-term liquidity needs, and that we would be able to access other sources of financing should the need arise.
Summary of Cash Flows
The following table summarizes our cash flows from operating, investing and financing activities for the periods indicated (in thousands):
Nine Months Ended
September 30,
Condensed Consolidated Statements of Cash Flows Data:20242023
 Net cash provided by (used in):
 Operating activities$156,257 $107,065 
 Investing activities(82,908)69,167 
 Financing activities19,318 (181,252)
Net increase (decrease) in cash and cash equivalents$92,667 $(5,020)
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Operating Activities
During the nine months ended September 30, 2024, net cash provided by operating activities was $156.3 million, compared to $107.1 million during the nine months ended September 30, 2023. The increase of $49.2 million was primarily attributable to increased revenue with favorable gross margins, lower interest paid and a $13.0 million payment made in the prior year for a termination fee relating to a licensing agreement.
Investing Activities
During the nine months ended September 30, 2024, net cash used in investing activities was $82.9 million, which reflected $74.4 million of outflows from available-for-sale investment purchases (net of sales), as well as $8.5 million of capital expenditures for manufacturing product fill lines and for an EXPAREL capacity expansion project at our Science Center Campus in San Diego, California.
During the nine months ended September 30, 2023, net cash provided by investing activities was $69.2 million, which reflected proceeds from $89.3 million of available-for-sale investment sales (net of purchases), partially offset by purchases of fixed assets of $13.4 million for fill lines for our products and equipment for an EXPAREL capacity expansion project at our Science Center Campus in San Diego, California and purchases of equity and debt investments of $6.8 million.
Financing Activities
During the nine months ended September 30, 2024, net cash provided by financing activities was $19.3 million, which primarily consisted of $287.5 million in proceeds from the issuance of the 2029 Notes. We used the majority of the proceeds from the 2029 Notes to make a partial repurchase of the 2025 Notes in the amount of $191.0 million, enter into a capped call transaction for $26.7 million, repurchase $25.0 million of treasury stock, and pay debt issuance and financing costs of $9.4 million. Additionally, we paid the remaining $8.6 million of 3.375% convertible senior notes due 2024 assumed from the Flexion Acquisition (the “Flexion 2024 Notes”) upon their maturity and made $8.4 million voluntary prepayments associated with the TLA Term Loan. See Note 8, Debt, to our condensed consolidated financial statements included herein for further discussion on the Flexion 2024 Notes, 2025 Notes, 2029 Notes, the capped call transaction and the TLA Term Loan. There was also $1.4 million of proceeds from the issuance of common stock through our ESPP.
During the nine months ended September 30, 2023, net cash used in financing activities was $181.3 million, which consisted of a $296.9 million repayment of TLB Term Loan principal as well as a $5.8 million prepayment penalty in connection with the retirement of the TLB Term Loan facility and $30.6 million repayments of TLA Term Loan principal, partially offset by the net proceeds from the TLA Term Loan of $149.6 million, proceeds from the exercise of stock options of $1.9 million and $1.7 million from the issuance of common stock through our ESPP.
Debt
2028 Term Loan A Facility
On March 31, 2023, we entered into a credit agreement (as amended to date, the “TLA Credit Agreement”) to refinance the indebtedness outstanding under our TLB Credit Agreement (as defined and discussed below). The term loan issued under the TLA Credit Agreement (the “TLA Term Loan”) was issued at a 0.30% discount and provides for a single-advance term loan A facility in the principal amount of $150.0 million, which is secured by substantially all of our and any subsidiary guarantor’s assets and matures on March 31, 2028. We may elect to borrow either (i) alternate base rate borrowings or (ii) term benchmark borrowings or daily simple SOFR (as defined in the TLA Credit Agreement) borrowings. Each term loan borrowing which is an alternate base rate borrowing bears interest at a rate per annum equal to (i) the Alternate Base Rate (as defined in the TLA Credit Agreement), plus (ii) a spread based on our Senior Secured Net Leverage Ratio ranging from 2.00% to 2.75%. Each term loan borrowing which is a term benchmark borrowing or daily simple SOFR borrowing bears interest at a rate per annum equal to (i) the Adjusted Term SOFR Rate or Adjusted Daily Simple SOFR (as each is defined in the TLA Credit Agreement), plus (ii) a spread based on our Senior Secured Net Leverage Ratio ranging from 3.00% to 3.75%. During the nine months ended September 30, 2024, we made voluntary principal prepayments of $8.4 million. During the year ended December 31, 2023, we made a scheduled principal payment of $2.8 million as well as $30.6 million of voluntary principal prepayments. Due to voluntary principal prepayments made, we are not required to make further principal payments until September 2026, although we retain the option to do so. As of September 30, 2024, borrowings under the TLA Term Loan consisted entirely of term benchmark borrowings at a rate of 7.95%.
The TLA Credit Agreement requires us to, among other things, maintain (i) a Senior Secured Net Leverage Ratio (as defined in the Credit Agreement), determined as of the last day of each fiscal quarter, of no greater than 3.00 to 1.00 and (ii) a Fixed Charge Coverage Ratio (as defined in the TLA Credit Agreement), determined as of the last day of each fiscal quarter, of
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no less than 1.50 to 1.00. The TLA Credit Agreement requires us to maintain an unrestricted cash and cash equivalents balance of at least $500.0 million less any prepayments of the 2025 Notes (as defined below) at any time from 91 days prior to the maturity date through the earlier of (i) the latest maturity date of the 2025 Notes and (ii) the date on which there is no outstanding principal amount of the 2025 Notes, which we expect to accomplish. The TLA Credit Agreement also contains customary affirmative and negative covenants, financial covenants, representations and warranties, events of default and other provisions. As of September 30, 2024, we were in compliance with all financial covenants under the TLA Credit Agreement. See Note 8, Debt, to our condensed consolidated financial statements included herein for further discussion.
2029 Convertible Senior Notes
In May 2024, we completed a private placement of $287.5 million in aggregate principal amount of our 2.125% convertible senior notes due 2029, or 2029 Notes, and entered into an indenture with respect to the 2029 Notes. The 2029 Notes accrue interest at a fixed rate of 2.125% per year, payable semiannually in arrears on May 15th and November 15th of each year. The 2029 Notes mature on May 15, 2029.
At September 30, 2024, all $287.5 million of principal was outstanding on the 2029 Notes. See Note 8, Debt, to our condensed consolidated financial statements included herein for further discussion.
2025 Convertible Senior Notes
In July 2020, we completed a private placement of $402.5 million in aggregate principal amount of our 0.750% convertible senior notes due 2025, or 2025 Notes, and entered into an indenture with respect to the 2025 Notes. The 2025 Notes accrue interest at a fixed rate of 0.750% per annum, payable semiannually in arrears on February 1st and August 1st of each year. The 2025 Notes mature on August 1, 2025.
In May 2024, we used part of the net proceeds from the issuance of the 2029 Notes to repurchase $200.0 million aggregate principal amount of the 2025 Notes in privately negotiated transactions at a discount for $191.4 million in cash (including accrued interest). The partial repurchase of the 2025 Notes resulted in a $7.5 million gain on early extinguishment of debt.
At September 30, 2024, the outstanding principal on the 2025 Notes was $202.5 million. See Note 8, Debt, to our condensed consolidated financial statements included herein for further discussion.
Future Capital Requirements
We believe that our existing cash and cash equivalents, available-for-sale investments and cash received from product sales will be sufficient to enable us to fund our operating expenses, capital expenditure requirements and payment of the interest and principal on our TLA Term Loan, 2025 Notes and 2029 Notes through the next 12 months. Our future use of operating cash and capital requirements will depend on many forward-looking factors, including, but not limited to:
•the cost and timing of the potential milestone payments to former Flexion stockholders, which could be up to an aggregate of $372.3 million if certain regulatory and commercial milestones are met. See Note 9, Financial Instruments, to our condensed consolidated financial statements included herein for more information;
•the impact of global economic conditions—including the impact of inflation—on our product, material and labor costs, supply chain, longer lead-times, an inability to secure a sufficient supply of materials, our operating expenses and our business strategy;
•the timing of and extent to which the holders of our 2025 Notes and 2029 Notes elect to convert their 2025 Notes and 2029 Notes, the timing of principal and interest payments on our TLA Term Loan and the timing and impact of increases to the variable interest rate on our TLA Term Loan borrowings in accordance with the terms of the TLA Credit Agreement;
•the costs and our ability to successfully continue to expand the commercialization of EXPAREL, ZILRETTA and iovera°;
•the cost and timing of expanding and maintaining our manufacturing facilities;
•the cost and timing of additional strategic investments, including additional investments under existing agreements;
•the costs related to legal and regulatory matters, including those to develop and defend our intellectual property;
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•the costs of performing additional clinical trials for our products, including the additional pediatric trials required by the FDA and EMA as a condition of the approval of EXPAREL;
•the costs for the development and commercialization of other product candidates;
•the costs and timing of future payments under our employee benefit plans, including but not limited to our cash long-term incentive plan and non-qualified deferred compensation plan;
•the timing and the number of shares of our common stock repurchased through our share repurchase program; and
•the extent to which we acquire or invest in products, businesses and technologies.
We may require additional debt or equity financing to meet our future operating and capital requirements. We have no committed external sources of funds, and additional equity or debt financing may not be available on acceptable terms, if at all. In particular, capital market disruptions or negative economic conditions may hinder our access to capital.

Critical Accounting Estimates
Goodwill represents the excess of the purchase price over the estimated fair value of the net assets acquired in a business combination and is subject to impairment testing at least annually or upon the occurrence of a triggering event that could indicate a potential impairment. We have historically tested goodwill for impairment by performing a qualitative assessment in order to determine whether facts and circumstances support a determination that reporting unit fair values are greater than their carrying values. This has historically been performed using readily available market data and company-specific factors.
If we determine that it is more likely than not that the fair value of the Company is less than its carrying value, a quantitative test is required. This is performed by comparing the fair value of the Company with its carrying value. If the estimated fair value of the reporting unit is less than the carrying amount of the reporting unit, impairment is indicated, requiring recognition of a goodwill impairment charge up to the carrying value of goodwill. The fair value of the Company was calculated through an income approach. Under the income approach, we calculate the fair value based on the present value of estimated future cash flows. Considerable management judgment is necessary to evaluate the impact of operating and macroeconomic changes and to estimate the future cash flows used to assume fair value. Our estimates of future cash flows consider past performance, current and anticipated market conditions and internal projections and operating plans which incorporate estimates for sales growth and future margins. Additional assumptions include forecasted growth rates, estimated discount rates and the probability of success for our product pipeline candidate products. We believe such assumptions also reflect current and anticipated market conditions and are consistent with those that would be used by other marketplace participants for similar valuation purposes. Such assumptions are subject to change due to changing economic and competitive conditions.
For more information, see Note 7, Goodwill and Intangible Assets, to our condensed consolidated financial statements included herein.
For a description of critical accounting policies that affect our significant judgments and estimates used in the preparation of our consolidated financial statements, refer to our 2023 Annual Report. Outside of the aforementioned, there have been no significant changes to our critical accounting policies nor any recently issued accounting pronouncements that are expected to have a material impact on our financial results since December 31, 2023.

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Contractual Obligations
In May 2024, we completed a private placement of $287.5 million of our 2029 Notes, and entered into an indenture with respect to the 2029 Notes. The 2029 Notes accrue interest at a fixed rate of 2.125% per year, payable semiannually in arrears on May 15th and November 15th of each year. The 2029 Notes mature on May 15, 2029. At September 30, 2024, all $287.5 million of principal was outstanding on the 2029 Notes.
In May 2024, we used part of the net proceeds from the issuance of the 2029 Notes to repurchase $200.0 million aggregate principal amount of the 2025 Notes in privately negotiated transactions at a discount for $191.4 million in cash (including accrued interest). At September 30, 2024, the outstanding principal on the 2025 Notes was $202.5 million.
In May 2024, the remaining principal of the 3.375% convertible senior notes due 2024 (the “Flexion 2024 Notes”) in the amount of $8.6 million was repaid at maturity.
See Note 8, Debt, to our condensed consolidated financial statements included herein for further discussion.
Outside of the issuance of the 2029 Notes, the partial repurchase of the 2025 Notes and the repayment of the Flexion 2024 Notes, there have been no material changes in our contractual obligations relating to our indebtedness, lease obligations and purchase obligations from those reported in our 2023 Annual Report. For more information on our contractual obligations and commercial commitments, see Part II, Item 7 in our 2023 Annual Report.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The primary objective of our cash equivalents and investment activities is to preserve principal while at the same time maximizing the income that we receive from our investments without significantly increasing risk. We invest in corporate bonds, commercial paper, asset-backed securities and U.S. Treasury and other government agency notes for purposes other than trading which are reported at fair value. These securities are subject to interest rate risk and credit risk. This means that a change in prevailing interest rates may cause the fair value of the investment to fluctuate. For example, if we hold a security that was issued with a fixed interest rate at the then-prevailing rate and the interest rate later rises, we expect that the fair value of our investment will decline. A hypothetical 100 basis point increase in interest rates would have reduced the fair value of our available-for-sale securities at September 30, 2024 by approximately $0.9 million.
The fair value of our 2025 Notes is impacted by both the fair value of our common stock and interest rate fluctuations. As of September 30, 2024, the estimated fair value of the 2025 Notes was $956 per $1,000 principal amount. See Note 8, Debt, to our condensed consolidated financial statements included herein for further discussion of our 2025 Notes, which bear interest at a fixed rate. At September 30, 2024, $202.5 million of principal remains outstanding on the 2025 Notes.
The fair value of our 2029 Notes is impacted by both the fair value of our common stock and interest rate fluctuations. As of September 30, 2024, the estimated fair value of the 2029 Notes was $757 per $1,000 principal amount. See Note 8, Debt, to our condensed consolidated financial statements included herein for further discussion of our 2029 Notes, which bear interest at a fixed rate. At September 30, 2024, $287.5 million of principal remains outstanding on the 2029 Notes.
The TLA Term Loan provides for a single-advance term loan in the principal amount of $150.0 million and is scheduled to mature on March 31, 2028. Each term loan borrowing that is a term benchmark borrowing or daily simple SOFR borrowing bears interest at a rate per annum equal to (i) the Adjusted Term SOFR Rate or Adjusted Daily Simple SOFR (as each is defined in the TLA Credit Agreement), plus (ii) a spread based on our Senior Secured Net Leverage Ratio ranging from 3.00% to 3.75%. At September 30, 2024, the outstanding principal on the TLA Term Loan was $108.1 million. As of September 30, 2024, borrowings under the TLA Term Loan consisted entirely of term benchmark borrowings at a rate of 7.95%. A hypothetical 100 basis point increase in interest rates would increase interest expense over the next 12 months by approximately $1.1 million, based on the balance outstanding for these borrowings as of September 30, 2024.
We have agreements with certain vendors and partners that operate in foreign jurisdictions. The more significant transactions are primarily denominated in the U.S. Dollar, subject to an annual adjustment based on changes in currency exchange rates.
Additionally, our accounts receivable are primarily concentrated with four large wholesalers of pharmaceutical products. In the event of non-performance or non-payment, there may be a material adverse impact on our financial condition, results of operations or net cash flow.
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Item 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
As required by Rule 13a-15(b) under the Exchange Act, our management, including our Chief Executive Officer and our Chief Financial Officer, conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. As defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, disclosure controls and procedures are controls and other procedures which are designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and our Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures were effective as of September 30, 2024.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal control over financial reporting that occurred during the quarter ended September 30, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls
Our management, including the Chief Executive Officer and our Chief Financial Officer, does not expect that our disclosure controls or our internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple errors or mistakes. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.

PART II — OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

For information related to Item 1. Legal Proceedings, refer to Note 15, Commitments and Contingencies, to our
condensed consolidated financial statements included herein.

Item 1A. RISK FACTORS

You should carefully consider the factors discussed in Part I, Item 1A. “Risk Factors” in our 2023 Annual Report, which could materially affect our business, financial condition, cash flows or future results. There have been no material changes in our risk factors included in our 2023 Annual Report. The risks described in our 2023 Annual Report are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition or future results.

Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

Item 3. DEFAULTS UPON SENIOR SECURITIES

None.
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Item 4. MINE SAFETY DISCLOSURES

Not applicable.

Item 5. OTHER INFORMATION
Rule 10b5-1 Trading Plans
During the quarter ended September 30, 2024, no director or executive officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.


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Item 6. EXHIBITS

The exhibits listed below are filed or furnished as part of this report.

Exhibit NumberDescription
Employment Agreement, dated April 19, 2012, between the Registrant and Lauren Riker.(1)***
Amendment No. 1 to Employment Agreement, dated March 13, 2013, between the Registrant and Lauren Riker.(2)***
Amendment No. 2 to Employment Agreement, dated June 30, 2015, between the Registrant and Lauren Riker.* ***
Amendment No. 3 to Employment Agreement, dated August 16, 2024, between the Registrant and Lauren Riker.* ***
Non-Healthcare Professional Consulting Agreement, effective October 1, 2024, between the Registrant and Charles. A. Reinhart, III* ***
Amended and Restated 2014 Inducement Plan.* ***
Form of Nonstatutory Stock Option Agreement under the Amended and Restated 2014 Inducement Plan.* ***
Form of Restricted Stock Unit Award Agreement under the Amended and Restated 2014 Inducement Plan.* ***
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and 15d-14(a), as amended.*
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and 15d-14(a), as amended.*
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**
101
The following materials from the Quarterly Report on Form 10-Q of Pacira BioSciences, Inc. for the quarter ended September 30, 2024, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) the Condensed Consolidated Balance Sheets; (ii) the Condensed Consolidated Statements of Operations; (iii) the Condensed Consolidated Statements of Comprehensive (Loss) Income; (iv) the Condensed Consolidated Statements of Stockholders’ Equity; (v) the Condensed Consolidated Statements of Cash Flows; and (vi) the Condensed Notes to Consolidated Financial Statements.*
104Cover Page Interactive Data File (Formatted as Inline XBRL and contained in Exhibit 101).

*Filed herewith.
**Furnished herewith.
***Denotes management contract or compensatory plan or arrangement.
(1)Incorporated by reference to the exhibits to the registrant's Quarterly Report on Form 10-Q, filed on May 9, 2012.
(2)Incorporated by reference to the exhibits to the registrant’s Current Report on Form 8-K, filed on March 18, 2013.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
PACIRA BIOSCIENCES, INC.
(REGISTRANT)
Date:November 6, 2024By: /s/ FRANK D. LEE
Frank D. Lee
Chief Executive Officer and Director
(Principal Executive Officer)
Date:November 6, 2024By:/s/ SHAWN M. CROSS
Shawn M. Cross
Chief Financial Officer
(Principal Financial Officer)

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