Flexion Therapeutics, Inc.

-- Conference call today at 4:30 p.m. ET -- TAMPA, Fla., July 30, 2024 (GLOBE NEWSWIRE) -- Pacira BioSciences, Inc. (Nasdaq: PCRX), the industry leader in its commitment to non-opioid pain management and regenerative health solutions, today reported financial results for the second quarter of 2024. Second Quarter 2024 Financial Highlights Total revenues of $178.0 millionNet product sales of $136.9 million for EXPAREL, $30.7 million for ZILRETTA, and $5.7 million for iovera°Net income of $18.9 million, or $0.41 per share (basic) and $0.39 per share (diluted)Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $62.1 million See “Non-GAAP Financial Information” below. “The first half of the year was marked by meaningful progress towards our commercial, clinical, and business objectives. With a focus on strong execution, we maintained solid sales across all three of our opioid-sparing products, strengthened our balance sheet, and realigned our leadership team to better position us for long-term success,” said Frank D. Lee, chief executive officer of Pacira BioSciences. “Looking ahead to the back half of the year, we remain sharply focused on preparations to maximize the benefit of separate EXPAREL reimbursement for outpatient procedures with the implementation of NOPAIN in January 2025.” “We have multiple initiatives underway to drive awareness around the opioid-sparing benefits of EXPAREL ahead of NOPAIN. Recent progress includes the publication of three robust real-world studies that demonstrate the opioid-sparing and economic benefits of EXPAREL and the launch of a national awareness and educational campaign. We remain confident this important reimbursement milestone will drive expanded EXPAREL utilization in outpatient settings and drive accelerated topline growth in 2025 and beyond,” continued Mr. Lee. Recent Business Highlights Centers for Medicare and Medicaid Services (CMS) propose new reimbursement for EXPAREL in all outpatient surgical environments beginning January 1, 2025. In July 2024, CMS issued its proposed Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System rule for 2025. In the proposed rule, EXPAREL® (bupivacaine liposome injectable suspension) is one of six covered non-opioids—two of which are specific to ophthalmology— qualifying for separate Medicare reimbursement in both the ambulatory surgical center (ASC) and hospital outpatient (HOPD) settings. Pending finalization, this policy would go into effect beginning January 1, 2025. The proposed rule reflects impending implementation of the Non-Opioids Prevent Addiction in the Nation (NOPAIN) Act, which mandates separate CMS payment for qualifying non-opioid drugs and devices across the HOPD and ASC settings. The law was passed as part of the Consolidated Appropriations Act of 2023. $150 Million Share Repurchase Program. In May 2024, the company announced a new share repurchase program which authorizes the company to repurchase up to an aggregate of $150 million of its outstanding common stock. Repurchases under the 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. Concurrently with the pricing of the offering of the 2029 Notes discussed below, 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 its common stock for $25.0 million. Issuance of $287.5 million aggregate principal amount of 2.125% convertible senior notes due 2029. In May 2024, Pacira issued $287.5 million in aggregate principal amount of 2.125% convertible senior notes due 2029 (the 2029 Notes) in a private placement. Pacira used approximately $191.0 million of the net proceeds to repurchase $200.0 million aggregate principal amount of its outstanding 0.750% convertible senior notes due 2025, approximately $26.7 million of the net proceeds to fund the cost of entering into capped call transactions associated with the issuance, and approximately $25.0 million of the net proceeds for the share repurchase referenced above. Pacira intends to use the remainder of the net proceeds from the offering for general corporate purposes, including working capital and research and development expenditures. Second Quarter 2024 Financial Results Total revenues were $178.0 million in the second quarter of 2024, versus $169.5 million reported for the second quarter of 2023.EXPAREL net product sales were $136.9 million in the second quarter of 2024, versus $135.1 million reported for the second quarter of 2023. Second quarter volume growth of 3 percent was offset by contracted discounts and vial mix. There were 63 selling days in the second quarter of 2024 and 64 selling days in the second quarter of 2023.ZILRETTA net product sales were $30.7 million in the second quarter of 2024, versus $29.3 million reported for the second quarter of 2023.Second quarter 2024 iovera° net product sales were $5.7 million, versus $4.4 million reported for the second quarter of 2023.Sales of bupivacaine liposome injectable suspension to third-party licensees were $3.2 million in the second quarter of 2024, versus $0.7 million reported for the second quarter of 2023.Total operating expenses were $149.8 million in the second quarter of 2024, compared to $129.6 million in the second quarter of 2023.Research and development (R&D) expenses were $20.3 million in the second quarter of 2024, compared to $18.8 million in the second quarter of 2023. R&D expenses included $7.3 million and $9.3 million of product development and manufacturing capacity expansion costs in the second quarters of 2024 and 2023, respectively.Selling, general and administrative (SG&A) expenses were $68.1 million in the second quarter of 2024, compared to $64.9 million in the second quarter of 2023.GAAP net income was $18.9 million, or $0.41 per share (basic) and $0.39 (diluted) in the second quarter of 2024, compared to $25.8 million, or $0.56 per share (basic) and $0.51 (diluted) in the second quarter of 2023.Non-GAAP net income was $44.2 million, or $0.96 per share (basic) and $0.89 per share (diluted) in the second quarter of 2024, compared to $36.0 million, or $0.78 per share (basic) and $0.71 per share (diluted), in the second quarter of 2023.Adjusted EBITDA was $62.1 million in the second quarter of 2024, compared to $54.3 million in the second quarter of 2023.Pacira ended the second quarter of 2024 with cash, cash equivalents and available-for-sale investments (“cash”) of $404.2 million. Cash provided by operations was $53.2 million in the second quarter of 2024, compared to $43.5 million in the second quarter of 2023.Pacira had 46.2 million basic and 50.5 million diluted weighted average shares of common stock outstanding in the second quarter of 2024. See “Non-GAAP Financial Information” below. 2024 Financial Guidance Today the company is reiterating its full-year 2024 financial guidance as follows: Total revenue of $680 million to $705 million;Non-GAAP gross margin of 74% to 76%;Non-GAAP R&D expense of $70 million to $80 million;Non-GAAP SG&A expense of $245 million to $265 million; andStock-based compensation of $50 million to $55 million. See “Non-GAAP Financial Information” below. Today’s Conference Call and Webcast Reminder The Pacira management team will host a conference call to discuss the company’s financial results and recent developments today, Tuesday, July 30, 2024, at 4:30 p.m. ET. For listeners who wish to participate in the question-and-answer session via telephone, please pre-register at investor.pacira.com/upcoming-events. All registrants will receive dial-in information and a PIN allowing them to access the live call. In addition, a live audio of the conference call will be available as a webcast. Interested parties can access the event through the “Events” page on the Pacira website at investor.pacira.com. Non-GAAP Financial Information This press release contains financial measures that do not comply with U.S. generally accepted accounting principles (GAAP), such as non-GAAP gross margin, non-GAAP cost of goods sold, non-GAAP research and development (R&D) expense, non-GAAP selling, general and administrative (SG&A) expense, non-GAAP net income, non-GAAP net income per common share, non-GAAP weighted average diluted common shares outstanding, EBITDA (earnings before interest, taxes, depreciation and amortization) and adjusted EBITDA, because these non-GAAP financial measures exclude the impact of items that management believes affect comparability or underlying business trends. These measures supplement the company’s financial results prepared in accordance with GAAP. Pacira management uses these measures to better analyze its financial results, estimate its future cost of goods sold, R&D expense and SG&A expense outlook for 2024 and to help make managerial decisions. In management’s opinion, these non-GAAP measures are useful to investors and other users of the company’s financial statements by providing greater transparency into the ongoing operating performance of Pacira and its future outlook. Such measures should not be deemed to be an alternative to GAAP requirements or a measure of liquidity for Pacira. The non-GAAP measures presented here are also unlikely to be comparable with non-GAAP disclosures released by other companies. See the tables below for a reconciliation of GAAP to non-GAAP measures. About Pacira Pacira BioSciences, Inc. (Nasdaq: PCRX) is committed to providing non-opioid pain management options to as many patients as possible to redefine the role of opioids as rescue therapy only. Pacira has three commercial-stage non-opioid treatments: EXPAREL® (bupivacaine liposome injectable suspension), a long-acting local analgesic currently approved for infiltration, fascial plane block, and as an interscalene brachial plexus nerve block for postsurgical pain management; ZILRETTA® (triamcinolone acetonide extended-release injectable suspension), an extended-release, intra-articular injection indicated for the management of osteoarthritis knee pain; and ioveraº®, a novel, handheld device for delivering immediate, long-acting, drug-free pain control using precise, controlled doses of cold temperature to a targeted nerve. To learn more about Pacira, including the corporate mission to reduce overreliance on opioids, visit www.pacira.com. About EXPAREL® (bupivacaine liposome injectable suspension) EXPAREL is indicated to produce postsurgical local analgesia via infiltration in patients aged 6 years and older, and postsurgical regional analgesia via an interscalene brachial plexus block in adults, a sciatic nerve block in the popliteal fossa in adults, and an adductor canal block in adults. The safety and effectiveness of EXPAREL have not been established to produce postsurgical regional analgesia via other nerve blocks besides an interscalene brachial plexus nerve block, a sciatic nerve block in the popliteal fossa, or an adductor canal block. The product combines bupivacaine with multivesicular liposomes, a proven product delivery technology that delivers medication over a desired time period. EXPAREL represents the first and only multivesicular liposome local anesthetic that can be utilized in the peri- or postsurgical setting. By utilizing the multivesicular liposome platform, a single dose of EXPAREL delivers bupivacaine over time, providing significant reductions in cumulative pain scores with up to a 78 percent decrease in opioid consumption; the clinical benefit of the opioid reduction was not demonstrated. Additional information is available at www.EXPAREL.com. Important Safety Information about EXPAREL for Patients EXPAREL should not be used in obstetrical paracervical block anesthesia. In studies in adults where EXPAREL was injected into a wound, the most common side effects were nausea, constipation, and vomiting. In studies in adults where EXPAREL was injected near a nerve, the most common side effects were nausea, fever, and constipation. In the study where EXPAREL was given to children, the most common side effects were nausea, vomiting, constipation, low blood pressure, low number of red blood cells, muscle twitching, blurred vision, itching, and rapid heartbeat. EXPAREL can cause a temporary loss of feeling and/or loss of muscle movement. How much and how long the loss of feeling and/or muscle movement depends on where and how much of EXPAREL was injected and may last for up to 5 days. EXPAREL is not recommended to be used in patients younger than 6 years old for injection into the wound, for patients younger than 18 years old, for injection near a nerve, and/or in pregnant women. Tell your health care provider if you or your child has liver disease, since this may affect how the active ingredient (bupivacaine) in EXPAREL is eliminated from the body. EXPAREL should not be injected into the spine, joints, or veins. The active ingredient in EXPAREL can affect the nervous system and the cardiovascular system; may cause an allergic reaction; may cause damage if injected into the joints; and can cause a rare blood disorder. About ZILRETTA® (triamcinolone acetonide extended-release injectable suspension) On October 6, 2017, ZILRETTA was approved by the U.S. Food and Drug Administration as the first and only extended-release intra-articular therapy for patients confronting osteoarthritis (OA)- related knee pain. ZILRETTA employs proprietary microsphere technology combining triamcinolone acetonide—a commonly administered, short-acting corticosteroid—with a poly lactic-co-glycolic acid (PLGA) matrix to provide extended pain relief. The pivotal Phase 3 trial on which the approval of ZILRETTA was based showed that ZILRETTA significantly reduced OA knee pain for 12 weeks, with some people experiencing pain relief through Week 16. Learn more at www.zilretta.com. Indication and Select Important Safety Information for ZILRETTA Indication: ZILRETTA is indicated as an intra-articular injection for the management of OA pain of the knee. Limitation of Use: The efficacy and safety of repeat administration of ZILRETTA have not been demonstrated. Contraindication: ZILRETTA is contraindicated in patients who are hypersensitive to triamcinolone acetonide, corticosteroids or any components of the product. Warnings and Precautions: Intra-articular Use Only: ZILRETTA has not been evaluated and should not be administered by epidural, intrathecal, intravenous, intraocular, intramuscular, intradermal, or subcutaneous routes. ZILRETTA should not be considered safe for epidural or intrathecal administration.Serious Neurologic Adverse Reactions with Epidural and Intrathecal Administration: Serious neurologic events have been reported following epidural or intrathecal corticosteroid administration. Corticosteroids are not approved for this use.Hypersensitivity reactions: Serious reactions have been reported with triamcinolone acetonide injection. Institute appropriate care if an anaphylactic reaction occurs.Joint infection and damage: A marked increase in joint pain, joint swelling, restricted motion, fever and malaise may suggest septic arthritis. If this occurs, conduct appropriate evaluation and if confirmed, institute appropriate antimicrobial treatment. Adverse Reactions: The most commonly reported adverse reactions (incidence ≥1%) in clinical studies included sinusitis, cough, and contusions. Please see ZILRETTALabel.com for full Prescribing Information. About iovera°® The iovera° system uses the body’s natural response to cold to treat peripheral nerves and immediately reduce pain without the use of drugs. Treated nerves are temporarily stopped from sending pain signals for a period of time, followed by a restoration of function. Treatment with iovera° works by applying targeted cold to a peripheral nerve. A precise cold zone is formed under the skin that is cold enough to immediately prevent the nerve from sending pain signals without causing damage to surrounding structures. The effect on the nerve is temporary, providing pain relief until the nerve regenerates and function is restored. Treatment with iovera° does not include injection of any substance, opioid, or any other drug. The effect is immediate and can last up to 90 days. The iovera° system is not indicated for treatment of central nervous system tissue. Additional information is available at www.iovera.com. Indication and Select Important Safety Information for iovera°® Indication: iovera° applies freezing cold to peripheral nerve tissue to block and/or relieve pain for up to 90 days. It should not be used to treat central nervous system tissue. Important Safety Information Do not receive treatment with iovera° if you experience hypersensitivity to cold or have open and/or infected wounds near the treatment site.You may experience bruising, swelling, inflammation and/or redness, local pain and/or tenderness, and altered feeling at the site of application.In treatment area(s), you may experience damage to the skin, skin darkening or lightening, and dimples in the skin.You may experience a temporary loss of your ability to use your muscles normally outside of the treatment area.Talk to your doctor before receiving treatment with iovera°. Forward-Looking Statements Any statements in this press release about Pacira’s future expectations, plans, trends, outlook, projections and prospects, and other statements containing the words “anticipate,” “believe,” “can,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “project,” “should,” “will,” “would,” and similar expressions, constitute 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 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, patent terms, development of products, strategic alliances and intellectual property, plans with respect to the Non-Opioids Prevent Addiction in the Nation (“NOPAIN”) Act and 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 cannot assure you that our estimates, assumptions and expectations will prove to have been correct. Actual results may differ materially from those 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 acquired 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 U.S. economic conditions (including inflation and rising interest rates), and our business, including our revenues, financial condition, cash flow and results of operations; the success of our sales and manufacturing efforts in support of the commercialization of EXPAREL, ZILRETTA 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 U.S. Food and Drug Administration supplemental New Drug Applications and premarket notification 510(k)s; the related timing and success of European Medicines Agency Marketing Authorization Applications; our plans to evaluate, develop and pursue additional product candidates utilizing our proprietary multivesicular liposome (“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; the anticipated funding or benefits of our share repurchase program; and factors discussed in the “Risk Factors” of our most recent Annual Report on Form 10-K and in other filings that we periodically make with the Securities and Exchange Commission (the “SEC”). In addition, the forward-looking statements included in this press release represent our views as of the date of this press release. Important factors could cause 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 these forward-looking statements as representing our views as of any date subsequent to the date of this press release. (Tables to Follow) Pacira BioSciences, Inc.Condensed Consolidated Balance Sheets(in thousands)(unaudited) June 30,2024 December 31,2023ASSETS Current assets: Cash and cash equivalents$247,053 $153,298Short-term available-for-sale investments 157,173 125,283Accounts receivable, net 104,779 105,556Inventories, net 103,438 104,353Prepaid expenses and other current assets 19,771 21,504Total current assets 632,214 509,994Noncurrent available-for-sale investments — 2,410Fixed assets, net 168,850 173,927Right-of-use assets, net 56,264 61,020Goodwill 163,243 163,243Intangible assets, net 454,614 483,258Deferred tax assets 135,136 144,485Investments and other assets 36,499 36,049Total assets$1,646,820 $1,574,386 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable$18,730 $15,698Accrued expenses 64,811 64,243Lease liabilities 9,149 8,801Current portion of convertible senior notes, net — 8,641Total current liabilities 92,690 97,383Convertible senior notes, net 479,549 398,594Long-term debt, net 109,751 115,202Lease liabilities 50,146 54,806Contingent consideration 22,401 24,698Other liabilities 13,005 13,573Total stockholders’ equity 879,278 870,130Total liabilities and stockholders’ equity$1,646,820 $1,574,386 Pacira BioSciences, Inc.Condensed Consolidated Statements of Operations(in thousands, except per share amounts)(unaudited) Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Net product sales: EXPAREL$136,852 $135,127 $269,282 $265,535 ZILRETTA 30,707 29,261 56,546 53,595 iovera° 5,674 4,384 10,704 8,385 Bupivacaine liposome injectable suspension 3,154 695 5,679 1,383 Total net product sales 176,387 169,467 342,211 328,898 Royalty revenue 1,636 — 2,929 910 Total revenues 178,023 169,467 345,140 329,808 Operating expenses: Cost of goods sold 44,262 48,207 91,678 97,227 Research and development 20,338 18,824 38,576 35,964 Selling, general and administrative 68,126 64,850 140,152 135,693 Amortization of acquired intangible assets 14,322 14,322 28,644 28,644 Contingent consideration charges (gains), restructuring charges and other 2,735 (16,613) 4,638 (4,506)Total operating expenses 149,783 129,590 303,688 293,022 Income from operations 28,240 39,877 41,452 36,786 Other income (expense): Interest income 4,749 2,111 8,652 5,253 Interest expense (3,884) (3,865) (7,200) (13,454)Gain (loss) on early extinguishment of debt 7,518 — 7,518 (16,926)Other, net (39) (269) (198) (279)Total other income (expense), net 8,344 (2,023) 8,772 (25,406)Income before income taxes 36,584 37,854 50,224 11,380 Income tax expense (17,698) (12,091) (22,359) (5,153)Net income$18,886 $25,763 $27,865 $6,227 Net income per share: Basic net income per common share$0.41 $0.56 $0.60 $0.14 Diluted net income per common share(1)$0.39 $0.51 $0.58 $0.13 Weighted average common shares outstanding: Basic 46,174 46,088 46,337 46,019 Diluted(1) 50,539 52,054 51,366 46,285 (1) Diluted net income per common share was calculated in consideration of the “if-converted” method associated with the Company’s convertible senior notes. Refer to the Reconciliation of GAAP to Non-GAAP Financial Information included herein for the inputs used in the computation. Pacira BioSciences, Inc.Reconciliation of GAAP to Non-GAAP Financial Information(in thousands, except per share amounts)(unaudited) Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 GAAP net income$18,886 $25,763 $27,865 $6,227 Non-GAAP adjustments: Contingent consideration charges (gains), restructuring charges and other: Changes in the fair value of contingent consideration 1,509 (18,258) (2,297) (6,640)Restructuring charges(1) (2) 504 936 3,804 936 Acquisition-related expenses(3) 230 709 404 1,198 Step-up of acquired Flexion Therapeutics, Inc. fixed assets and inventory to fair value and other — 1,727 — 3,834 Stock-based compensation 12,524 10,955 25,675 22,945 Chief Executive Officer transition costs(4) 294 — 571 — (Gain) loss on early extinguishment of debt (7,518) — (7,518) 16,926 Amortization of debt discount 23 28 47 703 Amortization of acquired intangible assets 14,322 14,322 28,644 28,644 Tax impact of non-GAAP adjustments(5) 3,456 (182) (1,890) (14,471)Total non-GAAP adjustments 25,344 10,237 47,440 54,075 Non-GAAP net income$44,230 $36,000 $75,305 $60,302 GAAP basic net income per common share$0.41 $0.56 $0.60 $0.14 GAAP diluted net income per common share$0.39 $0.51 $0.58 $0.13 GAAP net income used for basic earnings per share$18,886 $25,763 $27,865 $6,227 Interest expense on convertible senior notes, net of tax 762 1,029 1,790 — GAAP net income used for diluted earnings per share$19,648 $26,792 $29,655 $6,227 Non-GAAP basic net income per common share$0.96 $0.78 $1.63 $1.31 Non-GAAP diluted net income per common share$0.89 $0.71 $1.50 $1.20 Non-GAAP net income$44,230 $36,000 $75,305 $60,302 Interest expense on convertible senior notes, net of tax(6) 762 1,029 1,790 2,057 Non-GAAP net income used for diluted earnings per share(6)$44,992 $37,029 $77,095 $62,359 Weighted average common shares outstanding - basic 46,174 46,088 46,337 46,019 Weighted average common shares outstanding - diluted 50,539 52,054 51,366 46,285 Non-GAAP weighted average common shares outstanding - basic 46,174 46,088 46,337 46,019 Non-GAAP weighted average common shares outstanding - diluted(6) 50,539 52,054 51,366 51,892 Pacira BioSciences, Inc.Reconciliation of GAAP to Non-GAAP Financial Information (continued)(in thousands)(unaudited)(1) 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 beginning in January 2025 and broader commercial initiatives in key areas, such as strategic national accounts, marketing and market access and reimbursement. The charges related to employee termination benefits, severance, and, to a lesser extent, other employment-related termination costs. (2) Approximately $0.5 million and $2.7 million of restructuring charges were excluded from this line item as they are included in the stock-based compensation line item for the three and six months ended June 30, 2024, respectively. (3) Acquisition-related expenses related to vacant and underutilized leases assumed from the acquisition of Flexion Therapeutics, Inc. (“Flexion”). (4) The Company appointed a new chief executive officer (“CEO”) effective January 2, 2024. CEO transition costs include compensation costs related to the transition of the former CEO who remains employed by the Company in an advisory role. (5) The tax impact of non-GAAP adjustments is computed by: (i) applying the statutory tax rate to the income or expense adjusted items; (ii) applying a zero-tax rate to adjusted items where a valuation allowance exists; and (iii) excluding discrete tax benefits and expenses primarily associated with tax deductible and non-deductible stock-based compensation.For the three and six months ended June 30, 2024, the GAAP effective income tax rates were approximately 48% and 45%, respectively, and the non-GAAP effective income tax rate for both the three and six months ended June 30, 2024 was approximately 24% with the difference from GAAP primarily relating to the impact of excluding both discrete tax expenses associated with non-deductible stock-based compensation, primarily related to expired stock options, and non-deductible tax expenses related to executive compensation.For the three and six months ended June 30, 2023, the GAAP effective income tax rates were approximately 32% and 45%, respectively, and the non-GAAP effective income tax rate for both the three and six months ended June 30, 2023 was approximately 25% with the difference from GAAP primarily relating to the impact of excluding discrete tax expenses associated with non-deductible stock-based compensation and tax expenses related to executive compensation. (6) For the three months ended June 30, 2023 and the three and six months ended June 30, 2024, there were no non-GAAP adjustments when calculating the diluted weighted average common shares outstanding or the interest expense add back under the “if-converted” method.For the six months ended June 30, 2023, the then-outstanding $402.5 million aggregate principal 0.75% convertible senior notes due 2025, or 2025 Notes, were excluded from diluted net income per common share on a GAAP basis as the impact would have been antidilutive. These potential securities resulted in a dilutive impact on diluted net income per common share reported on a non-GAAP basis.For the six months ended June 30, 2023, non-GAAP adjustments to diluted weighted average shares outstanding included the impact of the 2025 Notes as if they converted on the first day of the period presented, which resulted in an additional 5.6 million common shares upon an assumed conversion and added back $2.1 million of interest expense, net of tax, to non-GAAP net income. The Company has the option to settle its 2025 Notes in cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock.Prior year amounts were reclassified to conform to the current year presentation.Pacira BioSciences, Inc.Reconciliation of GAAP to Non-GAAP Financial Information (continued)(in thousands)(unaudited) Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Cost of goods sold reconciliation: GAAP cost of goods sold$44,262 $48,207 $91,678 $97,227 Step-up of acquired Flexion fixed assets and inventory to fair value and other — (1,727) — (3,834)Stock-based compensation (1,259) (1,436) (2,387) (3,160)Non-GAAP cost of goods sold$43,003 $45,044 $89,291 $90,233 Research and development reconciliation: GAAP research and development$20,338 $18,824 $38,576 $35,964 Stock-based compensation (1,925) (1,722) (3,728) (3,597)Non-GAAP research and development$18,413 $17,102 $34,848 $32,367 Selling, general and administrative reconciliation: GAAP selling, general and administrative$68,126 $64,850 $140,152 $135,693 CEO transition costs (294) — (571) — Stock-based compensation (8,848) (7,797) (16,833) (16,188)Non-GAAP selling, general and administrative$58,984 $57,053 $122,748 $119,505 Weighted average shares outstanding - diluted reconciliation: GAAP weighted average common shares outstanding - diluted 50,539 52,054 51,366 46,285 Dilutive common shares associated with the 2025 Notes(1) — — — 5,607 Non-GAAP weighted average common shares outstanding - diluted 50,539 52,054 51,366 51,892 (1) For the six months ended June 30, 2023, potential common shares of the 2025 Notes were excluded from diluted net income per common share on a GAAP basis because they would have been antidilutive. These potential securities resulted in a dilutive impact on diluted net income per common share reported on a non-GAAP basis. Pacira BioSciences, Inc. Reconciliation of GAAP Net Income to Adjusted EBITDA (Non-GAAP)(in thousands)(unaudited) Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 GAAP net income$18,886 $25,763 $27,865 $6,227 Interest income (4,749) (2,111) (8,652) (5,253)Interest expense (1) 3,884 3,865 7,200 13,454 Income tax expense 17,698 12,091 22,359 5,153 Depreciation expense 4,541 4,732 8,645 10,012 Amortization of acquired intangible assets 14,322 14,322 28,644 28,644 EBITDA 54,582 58,662 86,061 58,237 Other adjustments: Contingent consideration charges (gains), restructuring charges and other: Changes in the fair value of contingent consideration 1,509 (18,258) (2,297) (6,640)Restructuring charges (2) 504 936 3,804 936 Acquisition-related expenses 230 709 404 1,198 Step-up of acquired Flexion inventory to fair value and other — 1,261 — 2,566 Stock-based compensation 12,524 10,955 25,675 22,945 CEO transition costs 294 — 571 — (Gain) loss on early extinguishment of debt (7,518) — (7,518) 16,926 Adjusted EBITDA$62,125 $54,265 $106,700 $96,168 (1) Includes amortization of debt discount and debt issuance costs.(2) Approximately $0.5 million and $2.7 million of restructuring charges were excluded from this line item as they are included in the stock-based compensation line item for the three and six months ended June 30, 2024, respectively. Pacira BioSciences, Inc.Reconciliation of GAAP to Non-GAAP 2024 Financial Guidance(dollars in millions) GAAP to Non-GAAP Guidance GAAP Impact of GAAP to Non-GAAP Adjustments (1) Non-GAAPTotal revenues $680 to $705 — $680 to $705Gross margin 73% to 75% Approximately 1% 74% to 76%Research and development expense $78 to $90 $8 to $10 $70 to $80Selling, general and administrative expense $280 to $310 $35 to $45 $245 to $265Stock-based compensation $50 to $55 — —(1) The full-year impact of GAAP to Non-GAAP adjustments primarily relates to stock-based compensation.

None  Welcome to this week's Chutes & Ladders, our roundup of significant leadership hirings, firings and retirings across the industry. Please send the good word—or the bad—from your shop to Gabrielle Masson and it will be featured here at the end of each week. Gilead's CMO bids adieu Gilead Sciences is saying goodbye to its chief medical officer after Merdad Parsey, M.D., Ph.D., announced intentions to leave the company early next year. As Gilead hunts for a successor, Parsey will continue to serve as CMO until the first quarter of 2025. The outgoing exec also plans to support the transition of his replacement over the next several months, Gilead said in a release. Parsey has been at Gilead for five years, joining in November 2019. During his stint at the company, Parsey helped lead the growth of Gilead’s development organization, including the establishment of Gilead’s cancer pipeline and the rollout of the COVID-19 treatment Veklury. The oncology portfolio has suffered some setbacks in recent months, however, with Gilead dropping work on magrolimab in April despite the anti-CD47 monoclonal antibody being the centerpiece of its $4.9 billion acquisition of Forty Seven. “It has been a privilege to lead the development team, especially as we have worked to deliver transformative medicines for people with HIV, COVID-19 and cancer,” Parsey said in a statement. “I am profoundly excited about the work we have done to build a strong, diverse clinical pipeline that has tremendous potential to deliver on our commitment to improve health for people around the world.” Release  Cassava execs are out Austin, Texas-based Cassava Sciences is searching for a permanent leader in the wake of the resignation of CEO Remi Barbier.  The Alzheimer's-focused company, which is no stranger to controversy, has found an interim helmsman in Richard Barry, who has been tapped as executive chairman of the board and Cassava’s principal executive officer, effective immediately. Barry has served as director of Cassava since June 2021 and has also served as director of Sarepta Therapeutics since June 2015. At the same time, the company will search for a new permanent CEO, Cassava said in a press release. Barbier is set to remain onboard with Cassava until Sept. 13 in a non-executive capacity, without duties or responsibilities. In addition, Lindsay Burns, Ph.D., SVP of neuroscience, has agreed to step down from her role at Cassava. After being separated from the company for a year, Burns will offer consulting services to Cassava, providing information and support for scientific research and obtaining approval for the company’s products. Release  I-Mab loses CEO, finds new board chair I-Mab also found itself in need of a new CEO this week, after Raj Kannan stepped down from his post on July 15. Kannan is sticking around as an advisor until July 31, while I-Mab hunts for a permanent successor. Sean Xi-Yong Fu will be stepping up to become interim helmsman and a member of the board of directors. Fu is also an operating partner of ABio-X, which is an incubation platform for life sciences companies. Before joining ABio-X, Fu was co-founder and CEO of RVAC Medicines, which utilized an mRNA platform. Meanwhile, after a six-year run as a member of I-Mab’s board of directors, Wei Fu is stepping up to the captain’s seat. Fu, who has served on I-Mab’s board since June 2018, is succeeding Pamela Klein, M.D., as chairman of the board. Klein is stepping down after taking on the role on an interim basis. Release  > Jonathan Appleby, Ph.D., has been appointed chief scientific officer of Mogrify Limited, a regenerative medicine company. He was previously executive director and CSO of the Cell and Gene Therapy Catapult and has held leadership roles at GSK, including CSO for cell and gene therapy in GSK’s Rare Diseases Unit. Release > Rectify Pharmaceuticals is appointing Bharat Reddy, Ph.D., as chief business officer. Reddy most recently served as a vice president of strategy and business development at Kelonia Therapeutics and has also served in leadership at Catamaran Bio and bluebird bio. Release > Daniel Janse, Ph.D., has been named president and CEO of AffyImmune. Janse is joining from Northpond Ventures, where he was managing director. He has also held leadership positions at Arbor Biotechnologies, Juno Therapeutics, Johnson & Johnson Innovation Center, Inventages Venture Capital and McKinsey & Company. Release > Nadir Mahmood, Ph.D., will join Nkarta as president, sharing executive leadership responsibilities with Paul Hastings, who continues as CEO. David Shook, M.D., is now chief medical officer, head of research and development. Mahmood was previously the CEO of Rezo Therapeutics and also had a past life at Nkarta as chief financial and business officer. Release > Avalo Therapeutics is appointing Mittie Doyle, M.D., as chief medical officer. Doyle joins from Aro Biotherapeutics, where she served as chief medical officer since 2021. She has also had senior roles at CSL Behring, Shire Pharmaceuticals, Flexion Therapeutics and Alexion Pharmaceuticals. Release > Rezo Therapeutics is appointing Cristiana Guiducci, Ph.D., as chief scientific officer. Guiducci previously served as senior vice president of immunology and oncology research at Nurix Therapeutics. She also spent more than 13 years at Dynavax Technologies. Release

-- Conference call today at 4:30 p.m. ET -- TAMPA, Fla., May 07, 2024 (GLOBE NEWSWIRE) -- Pacira BioSciences, Inc. (Nasdaq: PCRX), the industry leader in its commitment to non-opioid pain management and regenerative health solutions, today reported financial results for the first quarter of 2024. First Quarter 2024 Financial Highlights Total revenues of $167.1 millionNet product sales of $132.4 million for EXPAREL, $25.8 million for ZILRETTA, and $5.0 million for iovera°Net income of $9.0 million, or $0.19 per share (basic and diluted)Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $44.6 million See “Non-GAAP Financial Information” below. “Sales are off to a solid start for all three of our trusted, opioid-sparing products and we remain sharply focused on driving accelerated growth in 2025 and beyond,” said Frank D. Lee, chief executive officer of Pacira BioSciences. “We are pleased with the progress we are making advancing the launch of EXPAREL in two new lower extremity nerve block indications, and we are receiving positive market receptivity across all sites of care. We are also preparing for a significant growth catalyst ahead with the implementation of separate Medicare reimbursement for EXPAREL at average sales price plus 6 percent in outpatient settings beginning in January 2025. We believe this important reimbursement milestone will expand patient access to EXPAREL and drive greater utilization in outpatient procedures.” “Our confidence in Pacira’s future remains steadfast and the $150 million stock buyback announced today underscores our belief in our team, products, and growth outlook,” added Mr. Lee. Recent Business Highlights New $150 Million Share Repurchase Program. Today the company announced its Board of Directors has approved a new share repurchase program effective immediately, which authorizes the company to purchase up to an aggregate of $150 million of its outstanding common stock. Repurchases under the 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. The company expects to fund the share repurchase program using a combination of existing cash reserves and future cash flows.Positive Efficacy and Safety Data of PCRX-201 (enekinragene inzadenovec) Presented at OARSI 2024 World Congress. In April 2024, investigators presented encouraging preliminary results from a 72-patient study of PCRX-201 data at the Osteoarthritis Research Society International, or OARSI, 2024 World Congress in Vienna, Austria. PCRX-201 is the company’s novel, intra-articular helper-dependent adenovirus gene therapy product candidate that codes for interleukin-1 receptor antagonist (IL-1Ra), for the treatment of osteoarthritis of the knee. The data showed that a single intra-articular injection of PCRX-201 demonstrated sustained clinical effect as assessed by patient-reported outcomes at all dose levels for at least one-year post-injection. Importantly, PCRX-201 was shown to be well-tolerated with a favorable safety profile. The company expects to submit updated data demonstrating PCRX-201’s effectiveness through two years for presentation at a medical meeting in the Fall.PCRX-201 Granted Regenerative Medicine Advance Therapy (RMAT) Designation. In March 2024, the company announced that the U.S. Food and Drug Administration (FDA) has granted Regenerative Medicine Advanced Therapy (RMAT) designation to PCRX-201. The company’s RMAT application was supported by the preliminary safety and efficacy findings from the company’s Phase 1 study.Three New EXPAREL Patents. In March 2024, the United States Patent and Trademark Office issued Patent No. 11,925,706 claiming composition of matter, Patent No. 11,918,565 claiming method of use as a sciatic nerve block in the popliteal fossa, and Patent No. 11,931,459 claiming method of use in pediatric patients. Each of these EXPAREL patents are listed in the FDA’s “Approved Drug Products with Therapeutic Equivalence Evaluations” (the “Orange Book”). The ‘706 patent has an expiration date of January 22, 2041 and the ‘459 and ‘565 patents have expiration dates of March 17, 2042 and February 2, 2043, respectively. First Quarter 2024 Financial Results Total revenues were $167.1 million in the first quarter of 2024, versus $160.3 million reported for the first quarter of 2023.EXPAREL net product sales were $132.4 million in the first quarter of 2024, versus $130.4 million reported for the first quarter of 2023. First quarter volume growth of 3 percent was offset by contracted discounts and vial mix. There were 62 selling days in the first quarter of 2024 and 63 selling days in the first quarter of 2023.ZILRETTA net product sales were $25.8 million in the first quarter of 2024, versus $24.3 million reported for the first quarter of 2023.First quarter 2024 iovera° net product sales were $5.0 million, versus $4.0 million reported for the first quarter of 2023.Sales of bupivacaine liposome injectable suspension to third-party licensees were $2.5 million in the first quarter of 2024, versus $0.7 million reported for the first quarter of 2023.Total operating expenses were $153.9 million in the first quarter of 2024, compared to $163.4 million in the first quarter of 2023.Research and development (R&D) expenses were $18.2 million in the first quarter of 2024, compared to $17.1 million in the first quarter of 2023. R&D expenses included $7.4 million and $7.7 million of product development and manufacturing capacity expansion costs in the first quarters of 2024 and 2023, respectively.Selling, general and administrative (SG&A) expenses were $72.0 million in the first quarter of 2024, compared to $70.8 million in the first quarter of 2023.GAAP net income was $9.0 million, or $0.19 per share (basic and diluted) in the first quarter of 2024, compared to a GAAP net loss of $19.5 million, or $(0.43) per share (basic and diluted) in the first quarter of 2023.Non-GAAP net income was $31.1 million, or $0.67 per share (basic) and $0.62 per share (diluted) in the first quarter of 2024, compared to $24.3 million, or $0.53 per share (basic) and $0.49 per share (diluted), in the first quarter of 2023.Adjusted EBITDA was $44.6 million in the first quarter of 2024, compared to $41.9 million in the first quarter of 2023.Pacira ended the first quarter of 2024 with cash, cash equivalents and available-for-sale investments (“cash”) of $325.9 million. Cash provided by operations was $49.1 million in the first quarter of 2024, compared to $19.1 million in the first quarter of 2023.Pacira had 46.5 million basic and 52.2 million diluted weighted average shares of common stock outstanding in the first quarter of 2024.For non-GAAP measures, Pacira had 52.2 million diluted weighted average shares of common stock outstanding in the first quarter of 2024. See “Non-GAAP Financial Information” below. 2024 Financial Guidance Today the company is reiterating its full-year 2024 financial guidance as follows: Total revenue of $680 million to $705 million;Non-GAAP gross margin of 74% to 76%;Non-GAAP R&D expense of $70 million to $80 million;Non-GAAP SG&A expense of $245 million to $265 million; andStock-based compensation of $50 million to $55 million. See “Non-GAAP Financial Information” below. Today’s Conference Call and Webcast Reminder The Pacira management team will host a conference call to discuss the company’s financial results and recent developments today, Tuesday, May 7, 2024, at 4:30 p.m. ET. To participate in the conference call, dial 1-800-715-9871 and provide the passcode 6363041. International callers may dial 1-646-307-1963 and use the same passcode. In addition, a live audio of the conference call will be available as a webcast. Interested parties can access the event through the “Events” page on the Pacira website at investor.pacira.com. Non-GAAP Financial Information This press release contains financial measures that do not comply with U.S. generally accepted accounting principles (GAAP), such as non-GAAP gross margin, non-GAAP cost of goods sold, non-GAAP research and development (R&D) expense, non-GAAP selling, general and administrative (SG&A) expense, non-GAAP net income, non-GAAP net income per common share, non-GAAP weighted average diluted common shares outstanding, EBITDA (earnings before interest, taxes, depreciation and amortization) and adjusted EBITDA, because these non-GAAP financial measures exclude the impact of items that management believes affect comparability or underlying business trends. These measures supplement the company’s financial results prepared in accordance with GAAP. Pacira management uses these measures to better analyze its financial results, estimate its future cost of goods sold, R&D expense and SG&A expense outlook for 2024 and to help make managerial decisions. In management’s opinion, these non-GAAP measures are useful to investors and other users of the company’s financial statements by providing greater transparency into the ongoing operating performance of Pacira and its future outlook. Such measures should not be deemed to be an alternative to GAAP requirements or a measure of liquidity for Pacira. The non-GAAP measures presented here are also unlikely to be comparable with non-GAAP disclosures released by other companies. See the tables below for a reconciliation of GAAP to non-GAAP measures. About Pacira Pacira BioSciences, Inc. (Nasdaq: PCRX) is committed to providing non-opioid pain management options to as many patients as possible to redefine the role of opioids as rescue therapy only. Pacira has three commercial-stage non-opioid treatments: EXPAREL® (bupivacaine liposome injectable suspension), a long-acting local analgesic currently approved for infiltration, fascial plane block, and as an interscalene brachial plexus nerve block for postsurgical pain management; ZILRETTA® (triamcinolone acetonide extended-release injectable suspension), an extended-release, intra-articular injection indicated for the management of osteoarthritis knee pain; and ioveraº®, a novel, handheld device for delivering immediate, long-acting, drug-free pain control using precise, controlled doses of cold temperature to a targeted nerve. To learn more about Pacira, including the corporate mission to reduce overreliance on opioids, visit www.pacira.com. About EXPAREL® (bupivacaine liposome injectable suspension) EXPAREL is indicated to produce postsurgical local analgesia via infiltration in patients aged 6 years and older, and postsurgical regional analgesia via an interscalene brachial plexus block in adults, a sciatic nerve block in the popliteal fossa in adults, and an adductor canal block in adults. The safety and effectiveness of EXPAREL have not been established to produce postsurgical regional analgesia via other nerve blocks besides an interscalene brachial plexus nerve block, a sciatic nerve block in the popliteal fossa, or an adductor canal block. The product combines bupivacaine with multivesicular liposomes, a proven product delivery technology that delivers medication over a desired time period. EXPAREL represents the first and only multivesicular liposome local anesthetic that can be utilized in the peri- or postsurgical setting. By utilizing the multivesicular liposome platform, a single dose of EXPAREL delivers bupivacaine over time, providing significant reductions in cumulative pain scores with up to a 78 percent decrease in opioid consumption; the clinical benefit of the opioid reduction was not demonstrated. Additional information is available at www.EXPAREL.com. Important Safety Information about EXPAREL for Patients EXPAREL should not be used in obstetrical paracervical block anesthesia. In studies in adults where EXPAREL was injected into a wound, the most common side effects were nausea, constipation, and vomiting. In studies in adults where EXPAREL was injected near a nerve, the most common side effects were nausea, fever, and constipation. In the study where EXPAREL was given to children, the most common side effects were nausea, vomiting, constipation, low blood pressure, low number of red blood cells, muscle twitching, blurred vision, itching, and rapid heartbeat. EXPAREL can cause a temporary loss of feeling and/or loss of muscle movement. How much and how long the loss of feeling and/or muscle movement depends on where and how much of EXPAREL was injected and may last for up to 5 days. EXPAREL is not recommended to be used in patients younger than 6 years old for injection into the wound, for patients younger than 18 years old, for injection near a nerve, and/or in pregnant women. Tell your health care provider if you or your child has liver disease, since this may affect how the active ingredient (bupivacaine) in EXPAREL is eliminated from the body. EXPAREL should not be injected into the spine, joints, or veins. The active ingredient in EXPAREL can affect the nervous system and the cardiovascular system; may cause an allergic reaction; may cause damage if injected into the joints; and can cause a rare blood disorder. About ZILRETTA® (triamcinolone acetonide extended-release injectable suspension) On October 6, 2017, ZILRETTA was approved by the U.S. Food and Drug Administration as the first and only extended-release intra-articular therapy for patients confronting osteoarthritis (OA)- related knee pain. ZILRETTA employs proprietary microsphere technology combining triamcinolone acetonide—a commonly administered, short-acting corticosteroid—with a poly lactic-co-glycolic acid (PLGA) matrix to provide extended pain relief. The pivotal Phase 3 trial on which the approval of ZILRETTA was based showed that ZILRETTA significantly reduced OA knee pain for 12 weeks, with some people experiencing pain relief through Week 16. Learn more at www.zilretta.com. Indication and Select Important Safety Information for ZILRETTA Indication: ZILRETTA is indicated as an intra-articular injection for the management of OA pain of the knee. Limitation of Use: The efficacy and safety of repeat administration of ZILRETTA have not been demonstrated. Contraindication: ZILRETTA is contraindicated in patients who are hypersensitive to triamcinolone acetonide, corticosteroids or any components of the product. Warnings and Precautions: Intra-articular Use Only: ZILRETTA has not been evaluated and should not be administered by epidural, intrathecal, intravenous, intraocular, intramuscular, intradermal, or subcutaneous routes. ZILRETTA should not be considered safe for epidural or intrathecal administration.Serious Neurologic Adverse Reactions with Epidural and Intrathecal Administration: Serious neurologic events have been reported following epidural or intrathecal corticosteroid administration. Corticosteroids are not approved for this use.Hypersensitivity reactions: Serious reactions have been reported with triamcinolone acetonide injection. Institute appropriate care if an anaphylactic reaction occurs.Joint infection and damage: A marked increase in joint pain, joint swelling, restricted motion, fever and malaise may suggest septic arthritis. If this occurs, conduct appropriate evaluation and if confirmed, institute appropriate antimicrobial treatment. Adverse Reactions: The most commonly reported adverse reactions (incidence ≥1%) in clinical studies included sinusitis, cough, and contusions. Please see ZILRETTALabel.com for full Prescribing Information. About iovera°® The iovera° system uses the body’s natural response to cold to treat peripheral nerves and immediately reduce pain without the use of drugs. Treated nerves are temporarily stopped from sending pain signals for a period of time, followed by a restoration of function. Treatment with iovera° works by applying targeted cold to a peripheral nerve. A precise cold zone is formed under the skin that is cold enough to immediately prevent the nerve from sending pain signals without causing damage to surrounding structures. The effect on the nerve is temporary, providing pain relief until the nerve regenerates and function is restored. Treatment with iovera° does not include injection of any substance, opioid, or any other drug. The effect is immediate and can last up to 90 days. The iovera° system is not indicated for treatment of central nervous system tissue. Additional information is available at www.iovera.com. Indication and Select Important Safety Information for iovera°® Indication: iovera° applies freezing cold to peripheral nerve tissue to block and/or relieve pain for up to 90 days. It should not be used to treat central nervous system tissue. Important Safety Information Do not receive treatment with iovera° if you experience hypersensitivity to cold or have open and/or infected wounds near the treatment site.You may experience bruising, swelling, inflammation and/or redness, local pain and/or tenderness, and altered feeling at the site of application.In treatment area(s), you may experience damage to the skin, skin darkening or lightening, and dimples in the skin.You may experience a temporary loss of your ability to use your muscles normally outside of the treatment area.Talk to your doctor before receiving treatment with iovera°. Forward-Looking Statements Any statements in this press release about Pacira’s future expectations, plans, trends, outlook, projections and prospects, and other statements containing the words “anticipate,” “believe,” “can,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “project,” “should,” “will,” “would,” and similar expressions, constitute 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 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, patent terms, development of products, strategic alliances and intellectual property and 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 cannot assure you that our estimates, assumptions and expectations will prove to have been correct. Actual results may differ materially from those 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 acquired 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 U.S. economic conditions (including inflation and rising interest rates), and our business, including our revenues, financial condition, cash flow and results of operations; the success of our sales and manufacturing efforts in support of the commercialization of EXPAREL, ZILRETTA 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 U.S. Food and Drug Administration supplemental New Drug Applications and premarket notification 510(k)s; the related timing and success of European Medicines Agency Marketing Authorization Applications; our plans to evaluate, develop and pursue additional product candidates utilizing our proprietary multivesicular liposome (“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; the anticipated funding or benefits of our share repurchase program; and factors discussed in the “Risk Factors” of our most recent Annual Report on Form 10-K and in other filings that we periodically make with the Securities and Exchange Commission (the “SEC”). In addition, the forward-looking statements included in this press release represent our views as of the date of this press release. Important factors could cause 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 these forward-looking statements as representing our views as of any date subsequent to the date of this press release. (Tables to Follow) Pacira BioSciences, Inc.Condensed Consolidated Balance Sheets(in thousands)(unaudited) March 31,2024 December 31,2023ASSETS Current assets: Cash and cash equivalents$184,052 $153,298Short-term available-for-sale investments 141,838 125,283Accounts receivable, net 101,639 105,556Inventories, net 96,782 104,353Prepaid expenses and other current assets 18,802 21,504Total current assets 543,113 509,994Noncurrent available-for-sale investments — 2,410Fixed assets, net 171,804 173,927Right-of-use assets, net 58,626 61,020Goodwill 163,243 163,243Intangible assets, net 468,936 483,258Deferred tax assets 141,057 144,485Investments and other assets 36,542 36,049Total assets$1,583,321 $1,574,386 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable$8,982 $15,698Accrued expenses 66,818 64,243Lease liabilities 9,003 8,801Current portion of convertible senior notes, net 8,641 8,641Total current liabilities 93,444 97,383Convertible senior notes, net 399,210 398,594Long-term debt, net 112,477 115,202Lease liabilities 52,446 54,806Contingent consideration 20,892 24,698Other liabilities 12,690 13,573Total stockholders’ equity 892,162 870,130Total liabilities and stockholders’ equity$1,583,321 $1,574,386 Pacira BioSciences, Inc.Condensed Consolidated Statements of Operations(in thousands, except per share amounts)(unaudited) Three Months Ended March 31, 2024 2023 Net product sales: EXPAREL$132,430 $130,408 ZILRETTA 25,839 24,334 iovera° 5,030 4,001 Bupivacaine liposome injectable suspension 2,525 688 Total net product sales 165,824 159,431 Royalty revenue 1,293 910 Total revenues 167,117 160,341 Operating expenses: Cost of goods sold 47,416 49,020 Research and development 18,238 17,140 Selling, general and administrative 72,026 70,843 Amortization of acquired intangible assets 14,322 14,322 Contingent consideration (gains) charges, restructuring charges and other 1,903 12,107 Total operating expenses 153,905 163,432 Income (loss) from operations 13,212 (3,091)Other income (expense): Interest income 3,903 3,142 Interest expense (3,316) (9,589)Loss on early extinguishment of debt — (16,926)Other, net (159) (10)Total other income (expense), net 428 (23,383)Income (loss) before income taxes 13,640 (26,474)Income tax (expense) benefit (4,661) 6,938 Net income (loss)$8,979 $(19,536) Net income (loss) per share: Basic and diluted net income (loss) per common share$0.19 $(0.43)Weighted average common shares outstanding: Basic 46,499 45,949 Diluted 52,193 45,949 Pacira BioSciences, Inc.Reconciliation of GAAP to Non-GAAP Financial Information(in thousands, except per share amounts)(unaudited) Three Months Ended March 31, 2024 2023 GAAP net income (loss)$8,979 $(19,536) Non-GAAP adjustments: Contingent consideration (gains) charges, restructuring charges and other: Changes in the fair value of contingent consideration (3,806) 11,618 Restructuring charges (1) (2) 3,300 — Acquisition-related fees (3) 174 489 Step-up of acquired Flexion fixed assets and inventory to fair value and other — 2,107 Stock-based compensation 13,151 11,990 CEO transition costs (4) 277 — Loss on early extinguishment of debt — 16,926 Amortization of debt discount 24 675 Amortization of acquired intangible assets 14,322 14,322 Tax impact of non-GAAP adjustments (5) (5,346) (14,289)Total non-GAAP adjustments 22,096 43,838 Non-GAAP net income$31,075 $24,302 GAAP basic and diluted net income (loss) per common share$0.19 $(0.43) GAAP net income (loss) used for basic earnings per share$8,979 $(19,536)Interest expense on convertible senior notes, net of tax 1,029 — GAAP net income (loss) used for diluted earnings per share$10,008 $(19,536) Non-GAAP basic net income per common share$0.67 $0.53 Non-GAAP diluted net income per common share$0.62 $0.49 Non-GAAP net income$31,075 $24,302 Interest expense on convertible senior notes, net of tax (6) 1,029 1,029 Non-GAAP net income used for diluted earnings per share (6)$32,104 $25,331 Weighted average common shares outstanding - basic 46,499 45,949 Weighted average common shares outstanding - diluted 52,193 45,949 Non-GAAP Weighted average common shares outstanding - basic 46,499 45,949 Non-GAAP Weighted average common shares outstanding - diluted (6) 52,193 51,730 (1) 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 beginning in January 2025 and broader commercial initiatives in key areas, such as strategic national accounts, marketing and market access and reimbursement. The charges related to employee termination benefits, severance, and, to a lesser extent, other employment-related termination costs.(2) Approximately $2.2 million of restructuring charges were excluded from this line item as they are included in the stock-based compensation line item.(3) For the three months ended March 31, 2024 and 2023, acquisition-related fees related to vacant and underutilized leases assumed from the acquisition of Flexion Therapeutics, Inc. (“Flexion”).(4) The Company appointed a new chief executive officer (“CEO”) effective January 2, 2024. CEO transition costs include compensation costs related to the transition of the former CEO who remains employed by the Company in an advisory role.(5) The tax impact of non-GAAP adjustments is computed by: (i) applying the statutory tax rate to the income or expense adjusted items; (ii) applying a zero-tax rate to adjusted items where a valuation allowance exists; and (iii) excluding discrete tax benefits and expenses primarily associated with tax deductible and non-deductible stock-based compensation. For the three months ended March 31, 2024, the GAAP effective income tax rate was approximately 34% and the non-GAAP effective income tax rate was approximately 24%, with the difference from GAAP primarily due to the impact of excluding both discrete tax expenses associated with non-deductible stock-based compensation and tax expenses related to executive compensation. For the three months ended March 31, 2023, the GAAP effective income tax rate was approximately 26% and the non-GAAP effective income tax rate was approximately 23%, with the difference from GAAP primarily due to the impact of excluding tax expenses related to non-U.S. valuation allowances and non-deductible executive compensation.(6) For the three months ended March 31, 2024, there were no non-GAAP adjustments when calculating the diluted weighted average common shares outstanding or the interest expense add back under the “if-converted” method.For the three months ended March 31, 2023, the $402.5 million aggregate principal 0.75% convertible senior notes due 2025, or 2025 Notes, were excluded on a GAAP basis as the impact to diluted net loss per common share would have been antidilutive. These potential securities resulted in a dilutive impact on diluted net income per common share reported on a non-GAAP basis.For the three months ended March 31, 2023, non-GAAP adjustments to diluted weighted average shares outstanding included the impact of the 2025 Notes as if they converted on the first day of the period presented, which resulted in an additional 5.6 million common shares upon an assumed conversion and added back $1.0 million of interest expense, net of tax, to non-GAAP net income. The Company has the option to settle its 2025 Notes in cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock.Prior year amounts were reclassified to conform to the current year presentation. Pacira BioSciences, Inc.Reconciliation of GAAP to Non-GAAP Financial Information (continued)(in thousands)(unaudited) Three Months Ended March 31, 2024 2023 Cost of goods sold reconciliation: GAAP cost of goods sold$47,416 $49,020 Step-up of acquired Flexion fixed assets and inventory to fair value and other — (2,107)Stock-based compensation (1,128) (1,724)Non-GAAP cost of goods sold$46,288 $45,189 Research and development reconciliation: GAAP research and development$18,238 $17,140 Stock-based compensation (1,803) (1,875)Non-GAAP research and development$16,435 $15,265 Selling, general and administrative reconciliation: GAAP selling, general and administrative$72,026 $70,843 CEO transition costs (277) — Stock-based compensation (7,985) (8,391)Non-GAAP selling, general and administrative$63,764 $62,452 Weighted average shares outstanding - diluted reconciliation: GAAP weighted average common shares outstanding - diluted 52,193 45,949 Dilutive common shares associated with the 2025 Notes (1) — 5,608 Dilutive common shares associated with stock options and restricted stock units — 173 Non-GAAP weighted average common shares outstanding - diluted 52,193 51,730 (1) For the three months ended March 31, 2023, potential common shares of the 2025 Notes were excluded from diluted net loss per common share on a GAAP basis because they would have been antidilutive. These potential securities resulted in a dilutive impact on diluted net income per common share reported on a non-GAAP basis. Pacira BioSciences, Inc.Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA (Non-GAAP)(in thousands)(unaudited) Three Months Ended March 31, 2024 2023 GAAP net income (loss)$8,979 $(19,536) Interest income (3,903) (3,142) Interest expense (1) 3,316 9,589 Income tax expense (benefit) 4,661 (6,938) Depreciation expense 4,104 5,280 Amortization of acquired intangible assets 14,322 14,322 EBITDA 31,479 (425) Other adjustments: Contingent consideration (gains) charges, restructuring charges and other: Changes in the fair value of contingent consideration (3,806) 11,618 Restructuring charges (2) 3,300 — Acquisition-related fees 174 489 Step-up of acquired Flexion inventory to fair value and other — 1,305 Stock-based compensation 13,151 11,990 CEO transition costs 277 — Loss on early extinguishment of debt — 16,926 Adjusted EBITDA$44,575 $41,903 (1) Includes amortization of debt discount and debt issuance costs.(2) Approximately $2.2 million of restructuring charges were excluded from this line item as they are included in the stock-based compensation line item. Pacira BioSciences, Inc.Reconciliation of GAAP to Non-GAAP 2024 Financial Guidance(dollars in millions) GAAP to Non-GAAP Guidance GAAP Impact of GAAP to Non-GAAP Adjustments (1) Non-GAAPTotal revenues $680 to $705 — $680 to $705Gross margin 73% to 75% Approximately 1% 74% to 76%Research and development expense $78 to $90 $8 to $10 $70 to $80Selling, general and administrative expense $280 to $310 $35 to $45 $245 to $265Stock-based compensation $50 to $55 — — (1) The full-year impact of GAAP to Non-GAAP adjustments primarily relates to stock-based compensation.