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What changed in SWK Holdings Corp's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of SWK Holdings Corp's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+211 added−181 removedSource: 10-K (2026-03-20) vs 10-K (2025-03-20)

Top changes in SWK Holdings Corp's 2025 10-K

211 paragraphs added · 181 removed · 116 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeFor additional information concerning the competitive risks we face, see Item 1A., Risk Factors . Governmental Regulation For additional information concerning the effect of existing or probable government regulation on our business, see Item 1A., Risk Factors . Human Capital Resources As of December 31, 2024, we had 24 employees, all of whom are full-time.
Biggest changeFor additional information concerning the effect of existing or probable government regulation on our business, see Item 1A., Risk Factors . Human Capital Resources As of December 31, 2025, we had 9 employees, all of whom are full-time. None of our employees are represented by a labor union, and we consider our employee relations to be good.
We will make available free of charge through our website in the “Investor Relations - SEC Filings” section our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements and Forms 3, 4 and 5 filed on behalf of directors and executive officers and any amendments to those reports filed or furnished pursuant to the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.
We will make available free of charge through our website in the “Investor Relations - SEC Filings” section our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements, Forms 3, 4 and 5 filed on behalf of directors and executive officers and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.
As such, we believe we face less competition in transactions that are less than $50.0 million. 2 In our Pharmaceutical Development segment, we face competition in providing clinical development and manufacturing services from large, multinational contract development and manufacturing organizations ("CDMO"), smaller specialized CDMO's, as well as the in-house capabilities of pharmaceutical and biotech companies.
As such, we believe we face less competition in transactions that are less than $50.0 million. 2 Prior to selling substantially all of the assets of our Pharmaceutical Development segment, we faced competition in providing clinical development and manufacturing services from large, multinational contract development and manufacturing organizations ("CDMO"), smaller specialized CDMO's, as well as the in-house capabilities of pharmaceutical and biotech companies.
We have deployed our assets to earn interest, fees, and other income pursuant to this strategy, and we continue to identify and review financing and similar opportunities on an ongoing basis with financial solutions that are tailored to the individual needs of our business partners.
We have deployed our assets to earn interest, fees, and other income pursuant to this strategy, and we continue to identify and review financing and similar opportunities on an ongoing basis with financial solutions that are tailored to the individual needs of our business partners. 1 We fill an underserved niche in the sub-$50.0 million transaction size market.
Since many of our competitors that provide non-traditional debt and/or royalty financings typically have greater financial resources than us, they prioritize transaction sizes above $50.0 million.
Since many of our competitors that provide non-traditional debt and/or royalty financings typically have greater financial resources than us, they prioritize transaction sizes above $50.0 million. As such, we believe we face less competition in transactions that are less than $50.0 million.
Our operations comprise two reportable segments: “Finance Receivables” and “Pharmaceutical Development.” We evaluate and invest in a broad range of healthcare related companies and products with innovative intellectual property, including the biotechnology, medical device, medical diagnostics and related tools, animal health and pharmaceutical industries (collectively, “life sciences”).
We evaluate and invest in a broad range of healthcare related companies and products with innovative intellectual property, including the biotechnology, medical device, medical diagnostics and related tools, animal health and pharmaceutical industries (collectively, “life sciences”).
We allocate capital to each segment in order to generate income through the sales of life science products by third parties and related earned income sources. We are headquartered in Dallas, Texas.
We allocate capital within our finance receivables portfolio in order to generate income through the sales of life science products by third parties and related earned income sources. The Company is headquartered in Dallas, Texas.
As such, we believe we face less competition in transactions that are less than $50.0 million. 1 As of March 7, 2025, and since inception of the strategy, we and our partners have executed transactions with 58 different parties under our specialty finance strategy, funding an aggregate of approximately $852.5 million in various financial products across the life science sector.
As of March 7, 2026, and since inception of the strategy, we and our partners have executed transactions with 58 different parties under our specialty finance strategy, funding an aggregate of approximately $876.1 million in various financial products across the life science sector.
The principal purposes of our equity incentive plans are to attract, retain and motivate selected employees, consultants and directors through the granting of stock-based compensation awards and cash-based performance bonus awards.
Our human capital resources objectives include, as applicable, identifying, recruiting, retaining, incentivizing and integrating our existing and additional employees. The principal purposes of our equity incentive plans are to attract, retain and motivate selected employees, consultants and directors through the granting of stock-based compensation awards and cash-based performance bonus awards.
Our investment advisory clients generally do not originate investment opportunities for us. Pharmaceutical Development Segment During 2019, we commenced our Pharmaceutical Development segment with the acquisition of Enteris BioPharma, Inc. (“Enteris”). Enteris is a clinical development and manufacturing organization providing development services to pharmaceutical partners as well as innovative formulation solutions built around its proprietary oral drug delivery technologies.
Our investment advisory clients generally do not originate investment opportunities for us. Pharmaceutical Development Segment In 2019, we commenced our Pharmaceutical Development segment with the acquisition of Enteris BioPharma, Inc. (“Enteris”). In March 2025 we changed the name of Enteris to MOD3 Pharma ("MOD3"). MOD3 is a clinical development and manufacturing organization providing development services to pharmaceutical partners.
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In addition, through our wholly-owned subsidiary, SWK Advisors LLC, we are able to provide non-discretionary investment advisory services to institutional clients in separately managed accounts to similarly invest in life science finance. SWK Advisors LLC is registered as an investment advisor with the Texas State Securities Board.
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Prior to September 30, 2025 our operations were comprised of two reportable segments: “Finance Receivables” and “Pharmaceutical Development.” As a result of the sale of substantially all assets of the Pharmaceutical Development segment, the Finance Receivables segment will be the only remaining operating segment in subsequent years.
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We intend to fund transactions through our own working capital and our revolving credit facility, as well as by building our asset management business by raising additional third-party capital. We fill an underserved niche in the sub-$50.0 million transaction size market.
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MOD3 seeks to generate income by providing customers pharmaceutical development, formulation and manufacturing services. During the third quarter of 2025, we sold substantially all of the assets of the Pharmaceutical Development segment, after which the Company’s operations became solely attributable to the Finance Receivables segment.
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We seek to generate income by providing customers pharmaceutical development, formulation and manufacturing services as well as licensing its internally developed intellectual property.
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For additional information concerning the competitive risks we face, see Item 1A., Risk Factors . Governmental Regulation We have invested and plan to continue investing in cash flow streams produced by life sciences products that are subject to extensive regulation by the U.S.
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With an effective date of January 1, 2024, we entered into an Option and Asset Purchase Agreement ( the "Option") with a strategic partner on March 14, 2024, which granted the strategic partner an exclusive option to acquire certain of Enteris’ assets related to its business of providing good manufacturing practice (GMP) manufacturing and clinical supply services through Phase 1 and 2 to third parties, subject to certain exclusions.
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Food and Drug Administration (“FDA”), similar foreign regulatory authorities, and to a lesser extent, other federal and state agencies.
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The strategic partner must exercise the option by or before January 1, 2026. As of December 31, 2024, Enteris is classified as held for sale as the option is expected to be exercised within the next 12-months - see Note 7 for further details.
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If any of these products and the companies which manage such products fails to comply with applicable regulations, they could be subject to significant penalties and claims that could materially and adversely affect their sales levels and operations, which, in turn, could impair our ability to timely collect principal and interest payments owed to us or decrease our royalty-related income.
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None of our employees are represented by a labor union, and we consider our employee relations to be good. Our human capital resources objectives include, as applicable, identifying, recruiting, retaining, incentivizing and integrating our existing and additional employees.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeContinuing impacts of the pandemic and supply chain disruptions could continue to increase the risk of delinquencies, defaults, declining collateral values associated with our existing loans, and impairments or losses on our loans. Any such impairment could increase our credit risk and adversely affect the assets and results of operations of our Finance Receivables segment.
Biggest changeDisruptions to our partner companies, including as a result of global supply chain disruptions, would impair their ability to fulfill their obligations to us and may result in defaults in obligations to us. Impacts of supply chain disruptions may increase the risk of delinquencies, defaults, declining collateral values associated with our existing loans, and impairments or losses on our loans.
As a result of these new entrants, competition for investment opportunities in our target markets has intensified, which is a trend we expect to continue. 4 Many of our Finance Receivables segment’s existing and potential competitors are substantially larger and have considerably greater financial, technical and marketing resources than we do.
As a result of these new entrants, competition for investment opportunities in our target markets has intensified, which is a trend we expect to continue. Many of our Finance Receivables segment’s existing and potential competitors are substantially larger and have considerably greater financial, technical and marketing resources than we do.
The success of new product offerings will depend on many factors, including the ability to properly anticipate and satisfy customer needs, obtain regulatory approvals on a timely basis, develop and manufacture products in an economical and timely manner, obtain or maintain advantageous positions with respect to intellectual property, and differentiate products from competitors.
The success of new product offerings will depend on many factors, including the ability to properly anticipate and satisfy customer needs, obtain regulatory approvals on a timely basis, develop and manufacture products in an economical and timely manner, obtain or maintain advantageous positions with respect to intellectual 5 property, and differentiate products from competitors.
Any additional capital that we decide to advance would be subject to additional risk. We could lose all of any additional investment. The realization of any of these risks may materially impact our business, financial condition, results of operations, liquidity and cash flows. We operate in a highly competitive market for investment opportunities .
Any additional capital that we decide to advance would be subject to additional risk. We could lose all of any additional investment. The realization of any of these risks may materially impact our business, financial condition, results of operations, liquidity and cash flows. 4 We operate in a highly competitive market for investment opportunities .
Additionally, the Rights Agreement is intended to protect our ability to utilize our NOL carryforwards and make it difficult for a third party to acquire a significant number of shares of our common stock. Our certificate of incorporation and bylaws include provisions that may deter an unsolicited offer to purchase us.
Additionally, the Rights Agreement is intended to protect our ability to utilize our NOL carryforwards and contains provisions that make it difficult for a third party to acquire a significant number of shares of our common stock. Our certificate of incorporation and bylaws include provisions that may deter an unsolicited offer to purchase us.
Therefore, the assets that we and our subsidiaries hold and acquire are limited by the provisions of the 1940 Act and the rules and regulations promulgated thereunder. 14 If the SEC or its staff in the future adopts a contrary interpretation to that provided in the no-action letter to the predecessor of Royalty Pharma plc or otherwise restricts the conclusions in the SEC staff’s no-action letter such that royalty interests are no longer treated as ICA Exception Qualifying Assets for purposes of Section 3(c)(6), or the SEC or its staff in the future determines that the no-action letter does not apply to some or all types of royalty receivables relating to biopharmaceutical assets, our business could be materially and adversely affected.
Therefore, the assets that we and our subsidiaries hold and acquire are limited by the provisions of the 1940 Act and the rules and regulations promulgated thereunder. 13 If the SEC or its staff in the future adopts a contrary interpretation to that provided in the no-action letter to the predecessor of Royalty Pharma plc or otherwise restricts the conclusions in the SEC staff’s no-action letter such that royalty interests are no longer treated as ICA Exception Qualifying Assets for purposes of Section 3(c)(6), or the SEC or its staff in the future determines that the no-action letter does not apply to some or all types of royalty receivables relating to biopharmaceutical assets, our business could be materially and adversely affected.
Increased scrutiny and approval processes may limit the ability of our partner companies to market and commercialize their products in the U.S. and in foreign countries. 17 The development of products by life science companies requires significant research and development, clinical trials and regulatory approvals.
Increased scrutiny and approval processes may limit the ability of our partner companies to market and commercialize their products in the U.S. and in foreign countries. The development of products by life science companies requires significant research and development, clinical trials and regulatory approvals.
ITEM 1A. RISK FACTORS An investment in our common stock involves significant risks. You should carefully consider the risks and uncertainties, the risk factors set forth in the documents and reports filed with the SEC, and the risks described below before you make an investment decision regarding our common stock.
ITEM 1A. RISK FACTORS An investment in our common stock involves significant risks. You should carefully consider the risks and uncertainties, the risk factors set forth in the documents and reports previously filed with the SEC, and the risks described below before you make an investment decision regarding our common stock.
Unfavorable economic 16 conditions could also increase our funding costs, limit our access to the capital markets or result in a decision by lenders not to extend credit to us.
Unfavorable economic conditions could also increase our funding costs, limit our access to the capital markets or result in a decision by lenders not to extend credit to us.
While we currently maintain product liability insurance coverage, the amount of coverage may not be sufficient to protect us against losses or may be unavailable in the future on acceptable terms, if at all. Because Enteris is a biopharmaceutical company, its operations are subject to extensive government regulation.
While we currently maintain product liability insurance coverage, the amount of coverage may not be sufficient to protect us against losses or may be unavailable in the future on acceptable terms, if at all. Because MOD3 is a biopharmaceutical company, its operations are subject to extensive government regulation.
Additionally, certain data privacy and security laws, as well as industry best practice standards, may require us to implement and maintain additional cybersecurity measures. 15 Cybersecurity threat actors and their techniques change frequently, are often sophisticated in nature, and may not be detected until after a cybersecurity incident has occurred.
Additionally, certain data privacy and security laws, as well as industry best practice standards, may require us to implement and maintain additional cybersecurity measures. 14 Cybersecurity threat actors and their techniques change frequently, are often sophisticated in nature, and may not be detected until after a cybersecurity incident has occurred.
Furthermore, Enteris’ products may cause, or may appear to cause, adverse side effects or potentially dangerous drug interactions that we may not learn about or understand fully until the drug is actually manufactured and sold. Product liability claims can be expensive to defend and may result in large judgments against us.
Furthermore, MOD3 products may cause, or may appear to cause, adverse side effects or potentially dangerous drug interactions that we may not learn about or understand fully until the drug is actually manufactured and sold. Product liability claims can be expensive to defend and may result in large judgments against us.
Most of the assets of our Finance Receivables segment are, and are expected to continue to be, royalty streams or debt backed by royalty streams or revenue interests paid by small and middle-market life science businesses, which are highly speculative and involve a high degree of risk of credit loss.
Most of the assets of our Finance Receivables segment are, and are expected to continue to be, royalty streams or debt backed by royalty streams or revenue interests paid by small and middle-market life sciences businesses, which are highly speculative and involve a high degree of risk of credit loss.
If we match our competitors’ pricing, terms and structure, we may experience decreased net interest and royalty income and increased risk of credit loss. Healthcare and life science industries are subject to extensive government regulation, litigation risk, reimbursement risk and certain other risks particular to those industries.
If we match our competitors’ pricing, terms and structure, we may experience decreased net interest and royalty income and increased risk of credit loss. Healthcare and life sciences industries are subject to extensive government regulation, litigation risk, reimbursement risk and certain other risks particular to those industries.
Companies in the life science industry may also have a limited number of suppliers of necessary components or a limited number of manufacturers for their products, and therefore face a risk of disruption to their manufacturing process if they are unable to find alternative suppliers when needed.
Companies in the life sciences industry may also have a limited number of suppliers of necessary components or a limited number of manufacturers for their products, and therefore face a risk of disruption to their manufacturing process if they are unable to find alternative suppliers when needed.
The administration of drugs to humans, whether in clinical trials or commercially, can result in product liability claims, even if Enteris’ or Enteris’ partners’ products are not actually at fault for causing an injury.
The administration of drugs to humans, whether in clinical trials or commercially, can result in product liability claims, even if MOD3 or MOD3 partners’ products are not actually at fault for causing an injury.
Enteris’ present and future business is, and will continue to be, subject to various other laws, rules and/or regulations applicable to us as a result of our domestic and international business. The FDA and other regulatory agencies may inspect the Enteris production facility at any time to ensure compliance with current good manufacturing practice guidelines.
MOD3 present and future business is, and will continue to be, subject to various other laws, rules and/or regulations applicable to us as a result of our domestic and international business. The FDA and other regulatory agencies may inspect the MOD3 production facility at any time to ensure compliance with current good manufacturing practice guidelines.
In addition, the small and middle-market companies that we target to advance debt are subject to a number of other significant risks, including: • these companies may have limited financial resources and may be unable to meet their obligations under their financial instruments that we hold, which may be accompanied by a deterioration in the value of their assets or of any collateral with respect to any financial obligations and a reduction in the likelihood of our realization of any guarantees we may have obtained in connection with our investment; • they may have shorter operating histories, narrower product lines and smaller market shares than larger businesses, which tend to render them more vulnerable to competitors’ actions and market conditions, as well as general economic downturns; • they are more likely to depend on the management talents and efforts of a small group of persons; therefore, the death, disability, resignation or termination of one or more of these persons could have a material adverse impact on our partner company, and in turn, on us; • they may have less predictable operating results, may from time to time be parties to litigation, may be engaged in changing businesses with products subject to a risk of obsolescence and may require substantial additional capital to support their operations, finance expansion or maintain their competitive position; • they operate in the life science industry, which is both highly competitive and subject to extensive regulatory oversight, and their products may be recalled or displaced by new products, or they may lose regulatory approval altogether; • changes in laws and regulations, as well as their interpretations, may adversely affect their business, financial structure or prospects; and • they may have difficulty accessing capital markets to meet future capital needs.
In addition, the small- and middle-market companies that we target to advance debt are subject to a number of other significant risks, including: • limited financial resources and potential inability to meet their obligations under their financial instruments that we hold, which may be accompanied by a deterioration in the value of their assets or of any collateral with respect to any financial obligations and a reduction in the likelihood of our realization of any guarantees we may have obtained in connection with our investment; • potentially shorter operating histories, narrower product lines and smaller market shares than larger businesses, which tend to render them more vulnerable to competitors’ actions and market conditions, as well as general economic downturns; • higher likelihood that they depend on the management talents and efforts of a small group of persons; therefore, the death, disability, resignation or termination of one or more of these persons could have a material adverse impact on our partner company, and in turn, on us; • less predictable operating results, may from time to time be parties to litigation, and may be engaged in changing businesses with products subject to a risk of obsolescence, thus requiring substantial additional capital to support their operations, finance expansion or maintain their competitive position; • they operate in the life sciences industry, which is both highly competitive and subject to extensive regulatory oversight, and their products may be recalled or displaced by new products, or they may lose regulatory approval altogether; • changes in laws and regulations, as well as their interpretations, may adversely affect their business, financial structure or prospects; and • they may have difficulty accessing capital markets to meet future capital needs.
Failure to manage our future growth effectively could have a material adverse effect on our business, financial condition and results of operations. Risks Related to Pharmaceutical Development Segment Enteris’ technology or products could give rise to product liability claims.
Failure to manage our future growth effectively could have a material adverse effect on our business, financial condition and results of operations. 8 Risks Related to Pharmaceutical Development Segment MOD3's technology or products could give rise to product liability claims.
While Enteris does not have a commercial product, Enteris’ business exposes us to the risk of product liability claims from human testing and the manufacturing of pharmaceutical tablets currently used in clinical trials.
While MOD3 does not have a commercial product, MOD3 business exposes us to the risk of product liability claims from human testing and the manufacturing of pharmaceutical tablets currently used in clinical trials.
The investment objectives of Carlson and its affiliates may from time to time be different than or conflict with those of our other stockholders. 13 In addition, pursuant to the terms of a Stockholders’ Agreement entered into on February 27, 2023 (as amended, the “Stockholders’ Agreement”), funds affiliated with Carlson have the right to approve specific transactions, including the incurrence of indebtedness over specified amounts, the sale of assets over specified amounts, declaration of dividends, loans, capital contributions to or investments in any third party over specified amounts, changes in the size of the board of directors and repurchases of common stock.
The investment objectives of Carlson and its affiliates may from time to time be different than or conflict with those of our other stockholders. 12 In addition, pursuant to the terms of a Stockholders’ Agreement entered into on February 27, 2023, between the Company and Carlson (as amended, the “Stockholders’ Agreement”), Carlson has the right to approve specific transactions, including the incurrence of indebtedness over specified amounts, the sale of assets over specified amounts, declaration of dividends, loans, capital contributions to or investments in any third party over specified amounts, changes in the size of the board of directors and repurchases of common stock.
These threats may include, but are not limited to, social-engineering attacks (including phishing attacks), business email compromise, online and offline fraud, malicious code (such as viruses and worms), malware (including as a result of advanced persistent threat intrusions), employee misconduct, denial-of-service attacks, access attacks (such as credential stuffing), ransomware attacks, supply-chain attacks, and software bugs as well as cybersecurity failures resulting from human error, catastrophic events (such as fires, floods, hurricanes and tornadoes), loss of data or other information technology assets, and technological errors.
These threats may include, but are not limited to, social-engineering attacks (including phishing attacks), business email compromise, online and offline fraud, malicious code (such as viruses and worms), malware (including as a result of advanced persistent threat intrusions), employee or third party vendor misconduct, denial-of-service attacks, access attacks (such as credential stuffing), ransomware attacks, data breaches, supply-chain attacks, and software bugs as well as cybersecurity failures resulting from human error, catastrophic events (such as fires, floods, hurricanes and tornadoes), loss of data or other information technology assets, and technological errors, and may be enhanced or facilitated by Artificial Intelligence (“AI”).
Risks Related to Our Business and Structure Our ability to use NOL carryforwards to offset future taxable income for U.S. federal income tax purposes may be limited, and our future cash tax liability may increase. As of December 31, 2024, we had Net Operating Loss ("NOL") carryforwards for U.S. federal income tax purposes of $58.1 million.
Risks Related to Our Business and Structure Our ability to use NOL carryforwards to offset future taxable income for U.S. federal income tax purposes may be limited, and our future cash tax liability may increase. As of December 31, 2025, we had Net Operating Loss ("NOL") carryforwards for U.S. federal income tax purposes of $46.9 million.
We have invested and plan to continue investing in cash flow streams produced by life science products that are subject to extensive regulation by the Food and Drug Administration ("FDA"), similar foreign regulatory authorities, and to a lesser extent, other federal and state agencies.
We have invested and plan to continue investing in cash flow streams produced by life sciences products that are subject to extensive regulation by the U.S. Food and Drug Administration (“FDA”), similar foreign regulatory authorities, and to a lesser extent, other federal and state agencies.
Funds affiliated with Carlson can control or exert significant influence over our management and policies through their ownership of a large amount of our common stock. As of December 31, 2024, funds affiliated with Carlson owned in the aggregate 68.7% of our combined issued and outstanding common stock and unvested restricted stock.
Funds affiliated with Carlson can control or exert significant influence over our management and policies through their ownership of a large amount of our common stock. As of December 31, 2025, Carlson owned in the aggregate 75.1% of our combined issued and outstanding common stock and unvested restricted stock.
Pursuant to the Stockholders’ Agreement entered into on February 27, 2023, as amended, and a Registration Rights Agreement entered into on September 6, 2013, we filed a Registration Statement on Form S-3 with the SEC on February 3, 2020, which became effective on February 19, 2020, to register all of the common stock owned by funds associated with Carlson for sale freely in the public market from time to time.
Pursuant to the Stockholders’ Agreement entered into on February 27, 2023, and a Registration Rights Agreement entered into on September 6, 2013, between the Company and Carlson (the “Rights Agreement”), we filed a Registration Statement on Form S-3 with the SEC on February 3, 2020, which became effective on February 19, 2020, to register all of the common stock owned by Carlson for sale freely in the public market from time to time.
Future legislation, and/or regulations and policies adopted by the FDA or other U.S. or foreign regulatory authorities may increase the time and cost required by some of our partner companies to conduct and complete clinical trials for the product candidates that they develop, and there is no assurance that these companies will obtain regulatory approval to market and commercialize their products in the U.S. and in foreign countries.
Future legislation, and/or regulations and policies adopted by the FDA or other U.S. or foreign regulatory authorities may increase the time and cost required by some of our partner companies to conduct and complete clinical trials for the product candidates that they develop, and there is no assurance that these companies will obtain regulatory approval to market and commercialize their products in the U.S. and in foreign countries. 17 The FDA and other foreign and U.S. regulatory authorities have established regulations, guidelines and policies to govern the drug development and approval process which affect some of our partner companies.
The factors influencing these various assumptions and estimates cannot be calculated or predicted with certainty, and if our assumptions and estimates differ significantly from actual outcomes and results, our business, financial condition, results of operations, liquidity and cash flows may be materially and adversely affected. We generally do not control our partner companies.
The factors influencing these various assumptions and estimates cannot be calculated or predicted with certainty, and if our assumptions and estimates differ significantly from actual outcomes and results, our business, financial condition, results of operations, liquidity and cash flows may be materially and adversely affected.
In recent years, many such changes have been made, and changes are likely to continue to occur in the future. 10 It cannot be predicted whether, when, in what form or with what effective dates tax laws, regulations and rulings may be enacted, promulgated or issued, which could result in an increase in our or our shareholders’ tax liability or require changes in the manner in which we operate in order to minimize or mitigate any adverse effects of changes in tax law.
It cannot be predicted whether, when, in what form or with what effective dates tax laws, regulations and rulings may be enacted, promulgated or issued, which could result in an increase in our or our shareholders’ tax liability or require changes in the manner in which we operate in order to minimize or mitigate any adverse effects of changes in tax law.
Under Section 382 of the Internal Revenue Code (the “Code”), a corporation that undergoes an “ownership change” may be subject to limitations on its ability to utilize its pre-change NOL carryforward amounts to offset future taxable income.
In order to utilize the NOLs, we must generate taxable income that can offset such carryforwards. 9 Under Section 382 of the Internal Revenue Code (the “Code”), a corporation that undergoes an “ownership change” may be subject to limitations on its ability to utilize its pre-change NOL carryforward amounts to offset future taxable income.
Because Carlson controls a majority of our common stock, we are a “controlled company” within the meaning of the Nasdaq Capital Market ("Nasdaq") listing standards.
(“Carlson”) control a majority of our common stock, we are a “controlled company” within the meaning of the Nasdaq Capital Market (“Nasdaq”) listing standards.
These guidelines require that Enteris conduct its production operations in strict compliance with established rules for manufacturing and quality controls. Any of these agencies can suspend production operations and product sales if they find significant or repeated deviations from these guidelines.
These guidelines require that MOD3 conduct its production operations in strict compliance with established rules for manufacturing and quality controls. Any of these agencies can suspend production operations and product sales if they find significant or repeated deviations from these guidelines. A suspension would likely cause MOD3 to incur additional costs or delays in product development and manufacturing.
Public health epidemics, pandemics or outbreaks, and the resulting business or economic disruptions resulting therefrom, could adversely impact our and our partner companies’ businesses as well as our ability to raise capital.
Risks Associated with Investments in the Health Care and Life Sciences Industries Public health epidemics, pandemics or outbreaks could adversely affect our and our partner companies’ businesses. Public health epidemics, pandemics or outbreaks, and the resulting business or economic disruptions resulting therefrom, could adversely impact our and our partner companies’ businesses as well as our ability to raise capital.
As of December 31, 2024, we had $5.9 million of cash and cash equivalents plus $35.6 million available to be borrowed under our new credit facility with First Horizon Bank.
As of December 31, 2025, we had $42.8 million of cash and cash equivalents plus $10.0 million available to be borrowed under our new credit facility with First Horizon Bank.
There can be no assurance that another licensee could be found on favorable terms, or at all, or that the licensor will be able to assume marketing, sales and distribution responsibility for its own account.
There can be no assurance that another licensee could be found on favorable terms, or at all, or that the licensor will be able to assume marketing, sales and distribution responsibility for its own account. These factors may materially adversely affect any of our future royalty-related assets.
These factors may materially adversely affect any of our future royalty-related assets. 7 Aside from any limited audit rights relating to the activities of the licensees that we may have in certain circumstances, we do not have the rights or ability to manage the operations of the licensees.
Aside from any limited audit rights relating to the activities of the licensees that we may have in certain circumstances, we do not have the rights or ability to manage the operations of the licensees.
If the reference rate increases above the floor rate, the net effect will be an increase in the interest cost to the borrower.
The minimum reference rate floor insulates partner companies from an increase in the reference rate until the reference rate reaches the minimum floor threshold. If the reference rate increases above the floor rate, the net effect will be an increase in the interest cost to the borrower.
Our Finance Receivables segment has a limited number of assets, which subjects our aggregate returns, and the value of our common stock, to a greater risk of significant loss if any of our debt securities declines in value or if any of our royalty investments substantially underperforms our expectations.
The market performance of such products, therefore, may be diminished by any number of factors relating to the licensees that are beyond our control. 7 Our Finance Receivables segment has a limited number of assets, which subjects our aggregate returns, and the value of our common stock, to a greater risk of significant loss if any of our debt securities declines in value or if any of our royalty investments substantially underperforms our expectations.
A suspension would likely cause Enteris to incur additional costs or delays in product development and manufacturing. 9 Enteris relies on third parties to supply most of the necessary raw materials and supplies for the products we manufacture on behalf of our customers and our inability to obtain such raw materials or supplies may adversely impact our business, financial condition, and results of operations.
MOD3 relies on third parties to supply most of the necessary raw materials and supplies for the products we manufacture on behalf of our customers and our inability to obtain such raw materials or supplies may adversely impact our business, financial condition, and results of operations.
Our ability to make scheduled payments on, or to refinance our obligations under, the Notes or future indebtedness, will depend on our financial and operating performance and that of our subsidiaries, which, in turn, will be subject to prevailing economic and competitive conditions and to financial and business factors, many of which may be beyond our control. 12 We may not maintain a level of cash flow from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on the Notes or future indebtedness.
Our ability to make scheduled payments on, or to refinance our obligations under, the Notes or future indebtedness, will depend on our financial and operating performance and that of our subsidiaries, which, in turn, will be subject to prevailing economic and competitive conditions and to financial and business factors, many of which may be beyond our control.
If we are not able to continue to satisfy the continued listing standards, or qualify for an exemption to such standards, then we could be subject non-compliance status or de-listing.
If we are not able to continue to satisfy the continued listing standards, or qualify for an exemption to such standards, then we could be subject non-compliance status or de-listing. We have in the past received a letter from Nasdaq indicating that we were not in compliance with Nasdaq's listing standards.
The U.S. federal NOL carryforwards, if not offset against future income, will expire by 2037. We may recognize additional NOLs in the future. In order to utilize the NOLs, we must generate taxable income that can offset such carryforwards.
The U.S. federal NOL carryforwards, if not offset against future income, will expire by 2038. We may recognize additional NOLs in the future.
Furthermore, we may not realize the degree, or timing, of benefits we anticipate when we first enter into a transaction.
Furthermore, we may not realize the degree, or timing, of benefits we anticipate when we first enter into a transaction. We are dependent upon our key management personnel for our future success.
If we are unable to enter into new debt or equity financing arrangements on commercially reasonable terms, our liquidity may be reduced significantly, and as a result, our ability to implement and grow our business strategy could be materially impacted.
If we are unable to enter into new debt or equity financing arrangements on commercially reasonable terms, our liquidity may be reduced significantly, and as a result, our ability to implement and grow our business strategy could be materially impacted. 11 We may not be able to generate sufficient cash to service all of our debt, and may be forced to take other actions to satisfy our obligations under such indebtedness, which may not be successful.
COVID-19 has impacted, and may continue to impact, the ability of our borrowers and the marketers of products upon which we derive our royalty income to raise capital in order to fund and conduct their operations during the pandemic.
A global health crisis would likely impact the ability of our borrowers and the marketers of products upon which we derive our royalty income to raise capital in order to fund and conduct their operations.
Although we have endeavored to implement any management and director transition in a non-disruptive manner, such transitions might impact our business, and give rise to uncertainty among our customers, investors, vendors, employees and others concerning our future direction and performance, which may materially and adversely affect our business, financial condition, results of operations and cash flows, and our ability to execute our business model.
Although we have endeavored to implement any management and director transition in a non-disruptive manner, such transitions might impact our business, and give rise to uncertainty among our customers, investors, vendors, employees and others concerning our future direction and performance, which may materially and adversely affect our business, financial condition, results of operations and cash flows, and our ability to execute our business model. 10 In addition, because certain members of our management and Board have served in their respective capacities for only limited durations, we face the additional risks that these persons have limited familiarity with our past practices, our business and our industry and lack established track records in managing our business strategy.
Consequently, we may not be successful in attracting, motivating and retaining such personnel, and our failure to do so could have a negative effect on our business including our ability to successfully develop, introduce, and market our products which may adversely impact our operating results, or financial condition. 11 Because we are relying on the exemptions from corporate governance requirements as a result of being a “controlled company” within the meaning of the Nasdaq listing standards, you do not have the same protections afforded to stockholders of companies that are subject to such requirements.
Consequently, we may not be successful in attracting, motivating and retaining such personnel, and our failure to do so could have a negative effect on our business including our ability to successfully develop, introduce, and market our products which may adversely impact our operating results, or financial condition.
In addition, the ability of generic manufactures to invalidate a partner company’s patents protecting its products or to invalidate the patents supporting products in which we receive royalty-related income could have a material adverse effect on our business. 5 Our business, financial condition, results of operations, liquidity and cash flows depend on the accuracy of our management’s assumptions and estimates, and we could experience significant gains or losses if these assumptions and estimates differ significantly from actual results.
In addition, the ability of generic manufactures to invalidate a partner company’s patents protecting its products or to invalidate the patents supporting products in which we receive royalty-related income could have a material adverse effect on our business.
We generally only hold royalties, debt backed by royalties, and revenue interests that are issued by our partner companies.
We generally do not control our partner companies, and our partner companies may make decisions with which we don’t agree or that don’t serve our business or financial interests. We generally only hold royalties, debt backed by royalties, and revenue interests that are issued by our partner companies.
Additionally, any such changes to pharmaceutical product reimbursement similarly could reduce the revenues of the pharmaceutical products from which we receive royalties. 18
Additionally, any such changes to pharmaceutical product reimbursement similarly could reduce the revenues of the pharmaceutical products from which we receive royalties. 18 Risks Relating to the Mergers Stockholders will experience a reduction in percentage ownership and voting power in the combined company as a result of the Mergers.
Many of our debt transactions contain reference rate-based floating interest rates with minimum reference rate floors. The minimum reference rate floor insulates partner companies from an increase in the reference rate until the reference rate reaches the minimum floor threshold.
A rise in the reference rates could have an adverse impact on the ability of our partner companies to service their debt obligations to us. Many of our debt transactions contain reference rate-based floating interest rates with minimum reference rate floors.
COVID-19 has and will likely continue to result in social, economic and labor instability in the countries in which we or our partner companies operate.
An impact of such global health crisis would likely result in significant disruptions to the global economy, capital markets, and social, economic and labor instability in the countries in which we or our partner companies operate.
Efforts to retain or attract key personnel may result in significant additional expenses, which could adversely affect our profitability. Changes in our management may cause uncertainty in, or be disruptive to, our business. Certain of our directors and management team members have been with us in those capacities for only a short time.
Efforts to retain or attract key personnel may result in significant additional expenses, which could adversely affect our profitability. Changes in our management may cause uncertainty in, or be disruptive to, our business. Our success depends upon the continued services of executive officers and other key personnel, as well as their ability to effectively transition to their successors.
Any abrupt and substantial change in economic conditions also may decrease the value of collateral securing some of our loans and the value of our equity investments. Any sustained disruption in the capital markets from the COVID-19 pandemic could negatively impact our and our partner companies’ ability to raise capital.
Any sustained disruption in the capital markets could negatively impact our and our partner companies’ ability to raise capital.
Funds associated with Carlson own an aggregate of 68.7% (8,393,088 c ommon shares).
Funds associated with Carlson own an aggregate of 75.1% (9,078,719 common shares).
Further, our insurance coverage may not be adequate or sufficient in type or amount to protect us from or to mitigate liabilities arising out of our privacy and security practices. Risks Associated with Investments in the Health Care and Life Sciences Industries Public health epidemics, pandemics or outbreaks, including COVID-19, could adversely affect our and our partner companies’ businesses.
Further, our insurance coverage may not be adequate or sufficient in type or amount to protect us from or to mitigate liabilities arising out of our privacy and security practices. We, and our service providers, are subject to a variety of stringent and evolving privacy and data security laws, regulations, and other obligations related to privacy and data security.
On October 10, 2023, we entered into a First Amendment to Credit Agreement pursuant to which Woodforest National Bank was added as a lender under the Credit Agreement for an aggregate commitment of $15.0 million, thereby increasing the aggregate commitments under the Credit Agreement from $45.0 million to $60.0 million, subject to certain limitations.
On December 4, 2025, the Company and the Lenders entered into a Sixth Amendment to the Credit Agreement (the “Amendment”), which amended the Credit Agreement, dated as of June 28, 2023, in order to reduce the aggregate commitments thereunder from $60.0 million to $10.0 million.
Removed
For instance, on March 10, 2023, Silicon Valley Bank (“SVB”) was closed by the California Department of Financial Protection and Innovation, which appointed the Federal Deposit Insurance Corporation (“FDIC”) as receiver. Similarly, on March 12, 2023, Signature Bank and Silvergate Capital Corp. were each swept into receivership.
Added
Our business, financial condition, results of operations, liquidity and cash flows depend on the accuracy of our management’s assumptions and estimates, and we could experience significant gains or losses if these assumptions and estimates differ significantly from actual results.
Removed
We may not be able to complete transactions without co-investments from third parties. We may co-invest with third parties through our registered investment advisory business or otherwise. In certain circumstances, we may not be able to fund transactions without the participation of such third parties.
Added
In recent years, many such changes have been made, and changes are likely to continue to occur in the future.
Removed
In the event that we are unable to find suitable third parties to co-invest with us or if such third party fails to close, we may not be able to invest in an otherwise attractive opportunity, which could materially impact our results of operations.
Added
Because we are relying on the exemptions from corporate governance requirements as a result of being a “controlled company” within the meaning of the Nasdaq listing standards, you do not have the same protections afforded to stockholders of companies that are subject to such requirements. Because entities affiliated with Carlson Capital, L.P.
Removed
The market performance of such products, therefore, may be diminished by any number of factors relating to the licensees that are beyond our control.
Added
We may not maintain a level of cash flow from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on the Notes or future indebtedness.
Removed
The phase-out and replacement of LIBOR may adversely affect the value of our portfolio securities As of June 30, 2023, no settings of LIBOR continue to be published on a representative basis and publication of many non-U.S. Dollar LIBOR settings have been entirely discontinued. On July 29, 2021, the U.S.
Added
Further, attempts to disrupt or gain unauthorized access to our and our third party vendors’ information systems from malicious third parties or insider threats may incorporate widely varying and frequently changing tactics, which may be enhanced or facilitated by AI. We expend resources trying to protect against cybersecurity threats to our information technology systems.
Removed
Federal Reserve, in conjunction with the Alternative Reference Rates Committee, a steering committee comprised of large U.S. financial institutions, recommended replacing U.S. dollar LIBOR with alternative reference rates based on the Secured Overnight Financing Rate (“SOFR”). SOFR significantly differs from LIBOR, both in the actual rate and how it is calculated.
Added
Any actual or perceived failure to comply with such obligations could expose us to significant fines or other penalties and otherwise harm our business and operations.
Removed
Further, on March 15, 2022, the Consolidated Appropriations Act of 2022, which includes the Adjustable Interest Rate (LIBOR) Act (“LIBOR Act”), was signed into law in the United States. This legislation established a uniform benchmark replacement process for certain financial contracts that mature after June 30, 2023 that do not contain clearly defined or practicable LIBOR fallback provisions.
Added
In the U.S., there are numerous federal and state privacy and data security laws and regulations governing the collection, use, disclosure and protection of personal information, including security breach notification laws and consumer protection laws. Each of these laws is subject to varying interpretations and is constantly evolving.
Removed
The legislation also created a safe harbor that shields lenders from litigation if they choose to utilize a replacement rate recommended by the Board of Governors of the U.S. Federal Reserve. In addition, the U.K.
Added
For example, failing to take appropriate steps to keep consumers’ personal information secure may constitute unfair acts or practices in or affecting commerce in violation of Section 5(a) of the Federal Trade Commission (“FTC”) Act, 15 U.S.C § 45(a).
Removed
Financial Conduct Authority, which regulates the publisher of LIBOR (ICR Benchmark Administration) has announced that it will require the continued publication of one, three and six month tenors of U.S. dollar LIBOR on a non-representative synthetic basis until the end of September 2024, which may result in certain non-U.S. law-governed contracts and U.S. law-governed contracts not being covered by the federal legislation remaining on synthetic U.S. dollar LIBOR until the end of this period.
Added
The FTC expects a company’s data security measures to be reasonable and appropriate in light of the sensitivity and volume of consumer information it holds, the size and complexity of its business and the cost of available tools to improve security and reduce vulnerabilities.
Removed
The transition from LIBOR or the use of synthetic LIBOR in floating-rate debt securities in our portfolio or issued by us could have a material and adverse impact on the value or liquidity of those instruments.
Added
Further, regulators and legislators in the U.S. are increasingly scrutinizing and restricting certain personal data transfers and transactions involving foreign countries. For example, the Department of Justice’s January 8, 2025, rule on “Preventing Access to U.S.
Removed
The transition away from LIBOR to alternative reference rates is complex and could have a material adverse effect on our business, financial condition and results of operations, including as a result of any changes in the pricing of our investments, changes to the documentation for certain of our investments and the pace of such changes, disputes and other actions regarding the interpretation of current and prospective loan documentation or modifications to processes and systems. 8 A rise in the reference rates could have an adverse impact on the ability of our partner companies to service their debt obligations to us.
Added
Sensitive Personal Data and Government-Related Data by Countries of Concern or Covered Persons,” prohibits data brokerage transactions involving certain sensitive personal data categories, including health data, genetic data, and biospecimens, to countries of concern, including China. The regulations also restrict certain investment agreements, employment agreements and vendor agreements involving such data and countries of concern, absent specified cybersecurity controls.
Removed
For example, with an effective date of January 1, 2024, we entered into an exclusive Option and Asset Purchase Agreement with a strategic partner which granted the strategic partner an exclusive option to acquire certain of Enteris’ assets related to its business of providing contract manufacturing, formulation and development services.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeITEM 2. PROPERTIES Our corporate headquarters and the location of our Finance Receivables segment are in Dallas, Texas, where we lease office space totaling approximately 4,450 square feet of space. The Pharmaceutical Development segment’s headquarters is located in Boonton, New Jersey, where Enteris leases approximately 32,000 square feet of space. We believe these facilities are adequate for our business requirements.
Biggest changeITEM 2. PROPERTIES Our corporate headquarters and the location of our Finance Receivables segment are in Dallas, Texas, where we lease office space totaling approximately 4,450 square feet of office space. We believe these facilities are adequate for our business requirements.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeCurrently, we are not involved in any arbitration and/or other legal proceeding that we expect to have a material effect on our business, financial condition, results of operations and cash flows.
Biggest changeCurrently, we are not involved in any arbitration and/or other legal proceeding that we expect to have a material effect on our business, financial condition, results of operations and cash flows. 23 Merger Litigations On March 6, 2026, in connection with the Mergers, a purported individual shareholder of the Company filed a complaint in New York state court, captioned Eric Brady v.
Added
SWK Holdings Corp., et al. , No. 651394/2026 (N.Y. Sup. Ct., N.Y. Cnty.), naming as defendants the Company and certain members of the Company’s board of directors as of the date of the Merger Agreement (“ Brady ”).
Added
On March 9, 2026, an additional case was filed by a purported individual shareholder of the Company in the same court against the same defendants, captioned Anthony Malone v. SWK Holdings Corp., et al. , No. 651422/2026 (N.Y. Sup. Ct., N.Y. Cnty.) (“ Malone ”).
Added
The Brady and Malone cases, and any similar subsequently filed cases involving the Company, RWAY, their respective boards of directors, or any committee thereof and/or any of their directors or officers relating directly or indirectly to the Merger Agreement, the Mergers, or any related transaction, are referred to as the “Merger Litigations.” The Merger Litigations filed to date generally allege that the proxy statement issued on Schedule 14A by the Company on March 3, 2026 is materially incomplete and misleading and assert claims for negligent misrepresentation and concealment and negligence under New York common law.
Added
The Merger Litigations seek, among other things, an injunction enjoining consummation of the Mergers, rescission of the Mergers, costs of the actions, including attorneys’ fees and experts’ fees and expenses, and any other relief the court may deem just and proper.
Added
In addition, the Company has received multiple demand letters from purported Company stockholders (the “Demand Letters”), alleging that the proxy statement omits material information in violation of federal securities laws and state law disclosure requirements and demanding that the Company provide additional disclosures in an amendment or supplement to the proxy statement.
Added
The Company denies all allegations in the Merger Litigations and the Demand Letters, believes that no additional disclosure is required in the proxy statement, and intends to vigorously defend against these and any similar Merger Litigations and Demand Letters.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES . Market Information Since January 22, 2020, our common stock has been listed on the Nasdaq Capital Market, under the symbol “SWKH.” Holders of Record There were approximately 76 stockholders of record of our common stock as of February 27, 2025.
Biggest changeITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES . Market Information Since January 22, 2020, our common stock has been listed on the Nasdaq Capital Market, under the symbol “SWKH.” Holders of Record There were approximately 79 stockholders of record of our common stock as of February 25, 2026.
Removed
Dividend Policy To date, we have not paid any cash dividends on our capital stock. We intend to retain our cash and do not anticipate paying any cash dividends in the foreseeable future.
Added
Dividend Policy During the year ended December 31, 2025, the Company paid $49.1 million in dividends to our shareholders. Due to the pending merger with RWAY the Company does not intend to pay any cash dividends going forward.
Removed
Recent Sales of Unregistered Equity Securities None Issuer Purchases of Equity Securities On May 31, 2022, the Board authorized a share repurchase program under which the Company was authorized to repurchase up to $10.0 million of the Company’s outstanding shares of common stock.
Added
Recent Sales of Unregistered Equity Securities None Issuer Purchases of Equity Securities As of December 31, 2025, the Company has repurchased an aggregate of 992,629 shares at a total cost of $16.5 million, or $16.67 per share.
Removed
The previous repurchase periods under this program were July 1, 2022 through May 15, 2023 and May 16, 2023 through May 15, 2024 (the "Prior Repurchase Programs").
Removed
On May 16, 2024, the Company announced that the Board had authorized the Company to repurchase up to $10.0 million of the Company’s outstanding shares of common stock from time-to-time until May 16, 2025, through a trading plan established in compliance with Rule 10b5-1 and Rule 10b-18 of the Exchange Act (the “Current Repurchase Program”).
Removed
The actual timing, number and value of shares repurchased under the Repurchase Program will depend on several factors, including the constraints specified in the Rule 10b5-1 trading plan, price, and general market conditions. There is no guarantee as to the exact number of shares that will be repurchased under the Repurchase Program.
Removed
Our Board may also suspend or discontinue the Current Repurchase Program at any time, in its sole discretion. The purchase period for the Current Repurchase Program is May 16, 2024 through May 16, 2025.
Removed
The table below summarizes information about our purchases of common stock during the three months ending December 31, 2024: Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plan Maximum Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plan (in thousands) October 1, 2024 - October 31, 2024 33,858 $ 16.96 33,858 $ 5,655 November 1, 2024 - November 30, 2024 10,669 16.70 10,669 $ 5,476 December 1, 2024 - December 31, 2024 5,856 16.48 5,856 $ 5,380 50,383 $ 16.85 50,383 As of December 31, 2024, the Company has repurchased an aggregate of 793,411 shares under the Prior Repurchase Programs and Current Repurchase Program at a total cost of $13.5 million, or $16.99 per share.
Removed
As of December 31, 2024, the maximum dollar value of shares that may yet be purchased under the Current Repurchase Program was approximately $5.4 million shares of common stock.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeFirst lien 11/30/26 6,000 6,144 12.8 % 1,039 NeoLight, LLC First lien 2/15/26 5,000 5,250 13.5 % 992 Shield Therapeutics, Plc First lien 9/28/28 20,000 19,670 14.3 % 3,296 SKNV First lien 11/15/28 15,997 16,378 12.0 % 2,059 Triple Ring First lien 12/6/28 8,000 7,930 12.0 % 76 Marketable Investments Number of Shares Funded Amount GAAP Balance Change in Fair Value Secured Royalty Financing (Marketable Investment) (2), (3) N/A $ 3,000 $ 21 $ — AOTI Common Stock (8) 402,634 N/A 559 (85) EyePoint Pharmaceuticals — N/A — (181) Warrants to Purchase Stock Number of Shares Exercise Price per Share GAAP Balance Change in Fair Value 4Web, Inc.
Biggest changeFirst lien 04/14/27 8,500 8,922 12.8% 1,315 NeoLight, LLC First lien 05/15/27 5,756 6,151 13.5% 905 Shield Therapeutics, Plc First lien 09/28/28 20,000 20,070 14.3% 3,297 SKNV, LLC First lien 11/15/28 15,997 16,437 11.3% 1,970 Triple Ring Technologies First lien 12/06/28 8,000 8,092 12.0% 1,136 ImpediMed LTC First lien 02/05/30 15,000 14,675 13.8% 1,808 Marketable Investments Number of Shares Funded Amount GAAP Balance Change in Fair Value AOTI Common Stock 402,634 N/A 149 (336) Elutia, Inc. 50,000 N/A 35 (48) Privately Held Shares Number of Shares Epica International, Inc 25,000 SKNV, LLC 26,575 MolecuLight, Inc. 250,000 27 Warrants to Purchase Stock Number of Shares Exercise Price per Share GAAP Balance Change in Fair Value 4Web, Inc.
Primarily owning or financing through debt investments, royalties generated by the sales of life science products and related intellectual property; 2. Receiving interest and other income by advancing capital in the form of secured debt to companies in the life science sector; 3. Pharmaceutical development, manufacturing, and licensing activities; and 4.
Primarily owning or financing through debt investments, royalties generated by the sales of life science products and related intellectual property; 2. Receiving interest and other income by advancing capital in the form of secured debt to companies in the life science sector; 3. Pharmaceutical development, manufacturing, and licensing activities; and 32 4.
Discussion of 2023 items and year-to-year comparisons between 2023 and 2022 that are not included in this Annual Report can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
Discussion of 2024 items and year-to-year comparisons between 2024 and 2023 that are not included in this Annual Report can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.
When impairment is determined to be probable, the measurement will be based on the fair value of the collateral. The determination of impairment involves management’s judgment and the use of market and third-party estimates regarding collateral values. Valuations of impaired receivables and corresponding impairment affect the level of the reserve for credit losses.
When impairment is determined to be probable, the measurement will be based on the fair value of the collateral. The determination of impairment involves management’s judgment and the use of market and third-party estimates regarding collateral values. Valuations of impaired receivables and corresponding impairment affect the level of the allowance for credit losses.
Our financial instruments not required to be adjusted to fair value on a recurring basis consist principally of cash, cash equivalents, and accounts and finance receivables, accounts payable, and accrued expenses. We believe the carrying amount of cash and accounts and finance receivable, accounts payable and accrued expenses approximate fair value due to their relatively short maturities.
Our financial instruments not required to be adjusted to fair value on a recurring basis consist principally of cash, cash equivalents, accounts receivable, accounts payable, and accrued expenses. We believe the carrying amount of cash, cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate fair value due to their relatively short maturities.
The contingent consideration is the earnout related to the 2019 acquisition of Enteris and sharing of certain milestone and royalties due to Enteris pursuant to a license agreement ("License Agreement") with Cara Therapeutics, Inc. ("Cara") for oral formulation rights to Enteris' technology to develop and commercialize Oral KORSUVA™ in any indication worldwide, excluding South Korea and Japan.
The contingent consideration is the earnout related to the 2019 acquisition of MOD3 and sharing of certain milestone and royalties due to MOD3 pursuant to a license agreement ("License Agreement") with Cara Therapeutics, Inc. ("Cara") for oral formulation rights to MOD3 technology to develop and commercialize Oral KORSUVA™ in any indication worldwide, excluding South Korea and Japan.
Recent Accounting Pronouncements For a discussion of recent accounting pronouncements, refer to Note 1 of the notes to the consolidated financial statements in Part II, Item 8, Financial Statements and Supplementary Data . 26 Results of Operations This section of this Annual Report generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023.
Recent Accounting Pronouncements For a discussion of recent accounting pronouncements, refer to Note 1 of the notes to the consolidated financial statements in Part II, Item 8, Financial Statements and Supplementary Data . 30 Results of Operations This section of this Annual Report generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024.
Further, management’s judgment regarding the use of estimates and projections is required in assessing our ability to realize the deferred tax assets relating to NOL carryforwards, as most of these assets are subject to limited carryforward periods.
Further, management’s judgment regarding the use of estimates and projections is required in assessing the Company’s ability to realize deferred tax assets related to NOL carryforwards, as most of these assets are subject to limited carryforward periods.
Depreciation and Amortization Expense The $1.2 million decrease in depreciation and amortization expense for the year ended December 31, 2024 primarily consists of a decrease in amortization expense related to no longer amortizing intangible assets related to the Cara license as the intangible assets were fully impaired during the year.
Depreciation and Amortization Expense The $1.4 million decrease in depreciation and amortization expense for the year ended December 31, 2025 primarily consists of a decrease in amortization expense related to no longer amortizing intangible assets related to the Cara license as the intangible assets were fully impaired during the prior year.
Realizing capital appreciation from equity-related investments in the life science sector. As of December 31, 2024, our finance receivables portfolio contains $277.8 million of net finance receivables and $0.6 million of marketable investments. We expect these assets to generate positive cash flows in 2025. We continuously monitor the short and long-term financial position of our finance receivables portfolio.
Realizing capital appreciation from equity-related investments in the life science sector. As of December 31, 2025, our finance receivables portfolio contains $218.6 million of net finance receivables. We expect these assets to generate positive cash flows in 2026. We continuously monitor the short and long-term financial position of our finance receivables portfolio.
Please refer to Part I, Item 1, Business and Part II, Item 8, Financial Statements , Notes 1 and 13 of the notes to the consolidated financial statements for further information regarding segment information.
Please refer to Part II, Item 8, Financial Statements , Notes 1 and 12 of the notes to the consolidated financial statements for further information regarding segment information.
Primary Driver of Cash Flow Our ability to generate cash in the future depends primarily upon our success in implementing our Finance Receivables business model of generating income by providing capital to a broad range of life science companies, institutions and inventors, as well as the success of our Pharmaceutical Development segment. We generate income primarily from four sources: 1.
Primary Driver of Cash Flow Our ability to generate cash in the future depends primarily upon our success in implementing our Finance Receivables business model of generating income by providing capital to a broad range of life science companies, institutions and inventors. During the period presented we generated income primarily from four sources: 1.
Comparison of the Years Ended December 31, 2024 and 2023 The following table summarizes the results of our operations: (in millions) For the Year Ended December 31, Change 2024 2023 Revenues $ 45.0 $ 37.8 $ 7.2 Provision for credit losses 12.8 1.9 $ 10.9 Loss on impairment of intangible assets 5.8 — $ 5.8 Impairment of goodwill — 8.4 $ (8.4) Interest expense 4.7 1.8 $ 2.9 Pharmaceutical manufacturing, research and development expense 2.2 3.4 $ (1.2) Change in fair value of acquisition-related contingent consideration (4.9) (6.3) $ 1.4 Depreciation and amortization expense 1.4 2.6 $ (1.2) General and administrative expense 11.5 11.2 $ 0.3 Other income, net 6.8 — $ 6.8 Income tax expense (benefit) 4.9 (1.3) $ 6.2 Net income 13.5 15.9 $ (2.4) Revenues Revenues increased to $45.0 million for the year ended December 31, 2024 from $37.8 million for the year ended December 31, 2023.
Comparison of the Years Ended December 31, 2025 and 2024 The following table summarizes the results of our operations: (in millions) For the Year Ended December 31, Change 2025 2024 Revenues $ 41.5 $ 45.0 $ (3.5) Provision for (benefit from) credit losses (0.9) 12.8 $ (13.7) Loss on impairment 0.6 5.8 $ (5.2) Loss on disposal of inventory 0.3 — $ 0.3 Interest expense 4.8 4.7 $ 0.1 Pharmaceutical manufacturing, research and development expense 1.6 2.2 $ (0.6) Change in fair value of acquisition-related contingent consideration — (4.9) $ 4.9 Depreciation and amortization expense — 1.4 $ (1.4) General and administrative expense 14.8 11.5 $ 3.3 Other income (expense), net (0.2) 6.8 $ (7.0) Income tax expense 22.6 4.9 $ 17.7 Net income (loss) (2.5) 13.5 $ (16.0) Revenues Revenues decreased to $41.5 million for the year ended December 31, 2025, from $45.0 million for the year ended December 31, 2024.
Unless otherwise specified, our senior secured debt assets generally are repaid by a revenue interest that is charged on a company’s quarterly net sales and royalties. 24 Critical Accounting Policies and Estimates The discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP").
(5) Royalties were sold as of December 31, 2025 (6) Investment was paid off during the year ended December 31, 2025 Unless otherwise specified, our senior secured debt assets generally are repaid by a revenue interest that is charged on a company’s quarterly net sales and royalties. 28 Critical Accounting Policies and Estimates The discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP").
Interest Expense Interest expense consists of interest accrued on our revolving line of credit, 9.00% Senior Notes due 2027, unused line of credit and maintenance fees, as well as amortization of debt issuance costs. Interest expense increased to $4.7 million for year ended December 31, 2024 from $1.8 million for the year ended December 31, 2023.
Interest Expense Interest expense consists of interest accrued on our revolving line of credit, 9.00% Senior Notes due 2027, unused line of credit and maintenance fees, as well as amortization of debt issuance costs. Interest expense remained consistent for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
Fair Value of Financial Instruments The fair value of our financial instruments reflects the amounts that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price).
Other administrative service revenues are recognized when contractual obligations are fulfilled or as services are provided. Fair Value of Financial Instruments The fair value of our financial instruments reflects the amounts that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price).
The increase in the Pharmaceutical Development segment was primarily due to the strategic partner collaboration agreement. Provision for Credit Losses Our provision for credit losses is established through charges or credits to income in the form of the provision in order to bring our allowance for credit losses for loans and unfunded commitments to a level deemed appropriate by management.
Provision for (benefit from) Credit Losses Our provision for credit losses is established through charges or credits to income in the form of the provision in order to bring our allowance for credit losses for loans and unfunded commitments to a level deemed appropriate by management.
We entered into a $45.0 million revolving credit facility in June 2023 with First Horizon Bank. The Credit Agreement provides for one or more incremental increases not to exceed $80.0 million, subject to the consent of the Agent and each Lender, at any time prior to the Commitment Termination Date.
The Credit Agreement provides for one or more incremental increases not to exceed $80.0 million, subject to the consent of the Agent and each Lender, at any time prior to the Commitment Termination Date.
The $4.8 million increase in Finance Receivables segment revenue was primarily due to a $8.2 million increase in interest and fees earned due to funding new and existing loans offset by $2.5 million decrease in interest, fees and royalties earned on finance receivables that were paid off during the period.
The $2.1 million decrease in Finance Receivables segment revenue was primarily due to a decrease in interest, fees and royalties earned on finance receivables that were paid off or sold during the period.
As of December 31, 2024, we had $5.8 million in unfunded commitments. Please refer to Item 1., Financial Statements , Note 9 of the notes to the consolidated financial statements for further information regarding the Company’s commitments and contingencies. 29
We use the same credit policies in making commitments and conditional obligations as we do for on-balance sheet instruments. As of December 31, 2025, we had $2.5 million in unfunded commitments. Please refer to Item 1., Financial Statements , Note 8 of the notes to the consolidated financial statements for further information regarding the Company’s commitments and contingencies. 33
The $7.2 million increase in revenue for the year ended December 31, 2024 consisted of a $4.8 million increase in Finance Receivables segment revenue and a $2.4 million increase in Pharmaceutical Development segment revenue.
The $3.5 million decrease in revenue for the year ended December 31, 2025, consisted of a $2.1 million decrease in Finance Receivables segment revenue and a $1.4 million decrease in Pharmaceutical Development segment revenue prior to the sale of MOD3.
The increase in cash and cash equivalents was partially offset by $64.1 million of investment funding, net of deferred fees and origination expenses, a net credit facility payment of $6.2 million, a payroll and benefits expense of $5.4 million, $10.8 million of payments on accounts payable, and share repurchases of $6.0 million.
The increase in cash and cash equivalents was partially offset by the payment of dividends, investment funding, net of deferred fees and origination expenses, net payments of our credit facility, payments for payroll and benefits expense, payments on accounts payable, and share repurchases. We entered into a $45.0 million revolving credit facility in June 2023 with First Horizon Bank.
The primary driver of the $1.4 million increase in our cash balance was $88.2 million of interest, fees, principal and royalty payments received on our finance receivables and $5.0 million of cash receipts from pharmaceutical development revenues.
The primary driver of the $36.9 million increase in our cash balance was primarily related to interest, fees, principal and royalty payments received on finance receivables, and proceeds from the sale and repayment of finance receivables.
The contractual amounts of commitments to extend credit represent the amounts of potential accounting loss should the contract be fully drawn upon, the partner company defaults, and the value of any existing collateral becomes worthless. We use the same credit policies in making commitments and conditional obligations as we do for on-balance sheet instruments.
Such transactions are used primarily to manage partner companies’ requests for funding and take the form of loan commitments and lines of credit. The contractual amounts of commitments to extend credit represent the amounts of potential accounting loss should the contract be fully drawn upon, the partner company defaults, and the value of any existing collateral becomes worthless.
We will continue to assess the need for a valuation allowance on the deferred tax assets by evaluating both positive and negative evidence that may exist at each reporting date. Any adjustments to the deferred tax asset valuation allowance is recorded in the statement of operations in the period it is determined an adjustment is required.
In evaluating realizability, management considered the pending merger with a business development company and its potential impact on the availability of future taxable income. We will continue to assess the need for a valuation allowance on the deferred tax assets by evaluating both positive and negative evidence that may exist at each reporting date.
Liquidity and Capital Resources As of December 31, 2024, we had $5.9 million in cash and cash equivalents, compared to $4.5 million as of December 31, 2023.
Income tax expense increased period over period due to a reduction in the realizability of the deferred tax assets as of December 31, 2025. Liquidity and Capital Resources As of December 31, 2025, we had $42.8 million in cash and cash equivalents, compared to $5.9 million as of December 31, 2024.
General and administrative expenses increased to $11.5 million for the year ended December 31, 2024 from $11.2 million for the year ended December 31, 2023. Other Income, Net Other income, net increased to $6.8 million for the year ended December 31, 2024. Other income, net was immaterial for the year ended December 31, 2023.
Other Income (Expense), Net Other income (expense), net decreased to an expense of $0.2 million for the year ended December 31, 2025. Other income, net was $6.8 million for the year ended December 31, 2024.
Finance Receivables Portfolio Overview The tables below provide an overview of our outstanding transactions as of, and for the year ended, December 31, 2024 (in thousands, except rate, share and per share data): Royalty Purchases Licensed Technology Funded Amount GAAP Balance Revenue Recognized Besivance® (1) Ophthalmic antibiotic $ 6,000 $ — $ 29 Best ABT, Inc.
Finance Receivables Portfolio Overview The tables below provide an overview of our outstanding transactions as of, and for the year ended, December 31, 2025 (in thousands, except rate, share and per share data): Royalty Purchases Licensed Technology Funded Amount GAAP Balance Revenue Recognized Besivance® (1) Ophthalmic antibiotic $ 6,000 $ — $ 59 Forfivo XL® (5) Depressive disorder treatment 6,000 — 506 Coflex®/Kybella® (5) Spinal stenosis/submental fullness 4,350 — 48 Cambia® (5) NSAID migraine treatment 8,500 — 98 Duo Royalty (5) Japanese Women's health/cystic fibrosis 15,353 — 591 Immune Globulin (5) Immune Globulin Therapeutics 14,100 — 443 Relief (5) Rare Disease Portfolio 7,701 — 336 Best ABT, Inc.
We recognized a net provision for credit losses of $12.8 million and $1.9 million for the years ended December 31, 2024 and 2023, respectively.
We recognized a benefit from credit losses of $0.9 million and an expense of $12.8 million for the years ended December 31, 2025 and 2024, respectively. The $13.7 million decrease was primarily due to impairments included within the provision for credit losses during the year ended December 31, 2024.
The $60.0 million Credit Agreement contains a $5.0 million liquidity covenant, bringing the total amount available for borrowing to $35.6 million. 28 On October 3, 2023, the Company completed a registered underwritten public offering of $30.0 million of the Notes.
The $10.0 million Credit Agreement contains a $5.0 million liquidity covenant, bringing the total amount available for borrowing to $5.0 million.
TBD $ — $ — $ — Aziyo Biologics, Inc. Tranche 1 157,895 6.65 353 70 Aziyo Biologics, Inc. Tranche 2 30,075 6.65 67 13 Biotricity, Inc. Tranche 1 9,589 37.56 2 (2) Biotricity, Inc. Tranche 2 600,000 0.50 163 (5) CDMO Manufacturer 211,442 1.42 — — DxTerity Diagnostics, Inc. 2,019,231 — — — Epica International, Inc.
Tranche 2 600,000 $ 0.50 166 3 Biotricity, Inc. Tranche 3 27,150 $ 2.21 6 (42) Biotricity, Inc. Tranche 4 27,150 $ 2.21 6 (43) Biotricity, Inc. Tranche 5 120,000 $ 0.37 34 (4) CDMO Manufacturer 211,442 $ 1.42 — — DxTerity Diagnostics, Inc. 2,019,231 $ — — — Epica International, Inc. TBD $ — — — eTon Pharmaceuticals, Inc.
Tranche 1 57,859 10.37 — — MedMinder Systems, Inc. Tranche 2 14,465 10.37 — — Neolight, LLC 52,524 7.62 — — MolecuLight, Inc.
Tranche 1 57,859 $ 10.37 — — MedMinder Systems, Inc.
Please refer to Note 14 of the notes to the consolidated financial statements in Part II, Item 8, Financial Statements and Supplementary Data .
Any adjustments to the deferred tax asset valuation allowance is recorded in the statement of operations in the period it is determined an adjustment is required. 29 Please refer to Note 13 of the notes to the consolidated financial statements in Part II, Item 8, Financial Statements and Supplementary Data .
Change in Fair Value of Contingent Consideration We recognized gains of $4.9 million and $6.3 million from the change in fair value of acquisition-related contingent consideration during the years ended December 31, 2024 and 2023, respectively.
The $0.6 million decrease was primarily due to the sale substantially all of the assets of MOD3 during the period. 31 Change in Fair Value of Contingent Consideration The change in the gain on the fair value of contingent consideration is primarily due to a recognized gain of $4.9 million from the change in fair value of acquisition-related contingent consideration during the year ended December 31, 2024.
We anticipate near-term repayments from borrowers, however, no assurances can be given that actual results would not differ materially from the statement above. Off-Balance Sheet Arrangements In the normal course of operations, we engage in a variety of financial transactions that, in accordance with GAAP, are not recorded in our consolidated financial statements.
Off-Balance Sheet Arrangements In the normal course of operations, we engage in a variety of financial transactions that, in accordance with GAAP, are not recorded in our consolidated financial statements. These transactions involve, to varying degrees, elements of credit, interest rate, and liquidity risk.
Amortization expense is aligned with the expected future cash flows of the intangible assets. See Note 3 for more information on the impairment of the Cara license. General and Administrative Expense General and administrative expenses consist primarily of compensation, stock-based compensation and related costs for management, staff and Board; legal and audit expenses; and corporate governance expenses.
In addition, MOD3 was classified as held for sale for the current period resulting in no depreciation on fixed assets classified as held for sale. General and Administrative Expense General and administrative expenses consist primarily of compensation, stock-based compensation and related costs for management, staff and Board; legal and audit expenses; and corporate governance expenses.
TBD — — — Eton Pharmaceuticals, Inc. Tranche 1 51,239 5.86 424 327 Eton Pharmaceuticals, Inc. Tranche 2 18,141 6.62 148 111 Eton Pharmaceuticals, Inc. Tranche 3 289,736 5.32 3,008 1,936 EyePoint Pharmaceuticals, Inc. 40,910 11.00 — 127 EyePoint Pharmaceuticals, Inc. 7,773 19.30 — 22 Shield Warrant (10) 8,910,540 0.14 201 (193) MedMinder, System, Inc.
Tranche 1 51,239 $ 5.86 578 154 eTon Pharmaceuticals, Inc. Tranche 2 18,141 $ 6.62 199 51 eTon Pharmaceuticals, Inc. Tranche 3 289,736 $ 5.32 3,941 932 Nicoya Lifesciences, Inc. 276,630 C$ 1.81 — — Nicoya Lifesciences, Inc. 117,305 C$ 6.26 — — Shield Warrant 8,910,540 $ 0.14 695 355 MedMinder, System, Inc.
The $2.9 million increase in interest expense was mainly due to issuing approximately $32.9 million of Notes in an underwritten public offering in October of 2023. 27 Pharmaceutical Manufacturing, Research and Development Expense Pharmaceutical manufacturing, research and development expense decreased from $3.4 million for the year ended December 31, 2023 to $2.2 million for the year ended December 31, 2024.
Pharmaceutical Manufacturing, Research and Development Expense Pharmaceutical manufacturing, research and development expense decreased from $2.2 million for the year ended December 31, 2024 to $1.6 million for the year ended December 31, 2025.
Income Tax Expense During the years ended December 31, 2024 and 2023 we recognized $4.9 million income tax expense and $1.3 million of income tax benefit, respectively.
The $7.0 million change is primarily due to a loss on revaluation of finance receivables compared to a gain on finance receivables in the same period in the prior year. Income Tax Expense During the years ended December 31, 2025 and 2024 we recognized $22.6 million and $4.9 million of income tax expense, respectively.
In exchange for releasing its lien, SWK received cash at close and is expected to receive royalties on sales of two products. The finance receivable is now classified as a royalty. (6) In July 2023, Ideal Implant assets were sold to an aesthetics company, which is expected to pay SWK a mid-single digit, capped royalty on implant sales.
(2) Investment considered partially impaired. (3) Investment on non-accrual. (4) Flowonix Medical assets were sold to a medical device company in a prior period. In exchange for releasing its lien, SWK received cash at close and receives royalties on sales of two products.
On October 10, 2023, the Company entered into a First Amendment to Credit Agreement pursuant to which Woodforest National Bank was added as a lender under the Credit Agreement for an aggregate commitment of $15.0 million, thereby increasing the aggregate commitments under the Credit Agreement from $45.0 million to $60.0 million.
On December 4, 2025, the Company, SWK Funding LLC, First Horizon Bank, and the financial institution party thereto entered into a Sixth Amendment to the Credit Agreement (the “Amendment”), to reduce the aggregate commitments thereunder from $60.0 million to $10.0 million. As of December 31, 2025, there was no outstanding amount under the new Credit Agreement.
First lien 6/30/25 $ 23,736 $ 26,482 11.3 % $ 4,722 AOTI, Inc. First lien 3/21/27 8,478 8,635 11.2 % 1,895 BIOLASE, Inc. (2) (3) First lien 5/31/25 1,000 1,000 10.3 % 916 Biotricity, Inc. First lien 2/15/27 14,446 14,749 11.5 % 2,387 CDMO Manufacturer First lien 9/13/27 5,000 5,298 13.3 % 806 Elutia, Inc.
First lien 12/31/27 $ 19,486 $ 23,533 12.8% $ 4,299 Advanced Oxygen Therapy Inc. ("AOTI") First lien 02/15/29 19,478 19,679 10.9% 2,055 Elutia, Inc. (6) First lien 08/10/27 — — 11.0% 4,188 Biotricity, Inc. First lien 05/15/27 13,846 14,514 11.5% 2,668 CDMO Manufacturer First lien 09/13/27 5,000 5,600 13.3% 809 eTon Pharmaceuticals, Inc.
First lien 8/10/27 21,045 23,944 12.0 % 3,767 Epica International, Inc. First lien 7/23/24 — — 11.5 % 957 Eton Pharmaceuticals, Inc. First lien 12/17/27 30,000 28,925 12.1 % 900 Exeevo, Inc. (3), (9) First lien 7/1/27 — — 12.8 % 8 Journey Medical Corporation First lien 12/27/27 25,000 24,964 12.8 % 2,611 MedMinder Systems, Inc.
First lien 12/17/27 30,000 29,909 11.8% 4,556 Journey Medical Corporation First lien 06/27/28 25,000 25,325 12.8% 3,668 MedMinder Systems, Inc. First lien 08/18/28 22,500 23,082 9.1% 3,138 MolecuLight, Inc. (6) First lien 12/29/27 — — 12.8% 27 Nicoya Lifesciences, Inc.
Income tax expense increased period over period due to the release of valuation allowance on deferred tax assets of $6.7 million during the year ended December 31, 2023 and an increase in the Company's effective tax rate to 26.6% as of December 31, 2024 from a benefit of 8.7% for the same period in the prior year.
General and administrative expenses increased to $14.8 million for the year ended December 31, 2025 from $11.5 million for the year ended December 31, 2024 primarily due to an increase in compensation costs and legal costs during the period.
Removed
Overview We have organized our operations into two segments: Finance Receivables and Pharmaceutical Development. These segments reflect the way we evaluate our business performance and manage our operations.
Added
Overview For the year ended December 31, 2025, the Company operated two reportable segments, Pharmaceutical Development and Finance Receivables. During the third quarter of 2025, the Company sold substantially all of the assets of the Pharmaceutical Development Segment, after which the Company’s operations were primarily attributable to the Finance Receivables segment.
Removed
With an effective date of January 1, 2024, we entered into an exclusive Option and Asset Purchase Agreement with a strategic partner on March 14, 2024, which granted the strategic partner an exclusive option to acquire certain of Enteris’ assets related to its business of providing good manufacturing practice (GMP) manufacturing and clinical supply services through Phase 1 and 2 to third parties, subject to certain exclusions.
Added
(2), (3) Oncology diagnosis 5,784 1,755 — Flowonix Medical, Inc. (2), (3), (4) Drug delivery device 12,455 5,875 — Ideal Implant, Inc. (2), (3) Aesthetics 4,025 2,286 — Iluvien® (6) Diabetic macular edema 16,501 — 519 26 Term Loans Type Maturity Date Principal GAAP Balance Rate Revenue Recognized 4Web, Inc.
Removed
The strategic partner must exercise the Option by or before January 1, 2026. As of December 31, 2024, Enteris is classified as held for sale as the Option is expected to be exercised within the next 12-months.
Added
TBD $ — $ — $ — ImpediMed Tranche 1 12,491,870 $ 0.05 176 (140) ImpediMed Tranche 2 6,245,935 $ 0.05 88 (93) Aziyo Biologics, Inc. Tranche 1 157,895 $ 6.65 19 (334) Aziyo Biologics, Inc. Tranche 2 30,075 $ 6.65 4 (64) Biotricity, Inc. Tranche 1 9,589 $ 37.56 1 — Biotricity, Inc.
Removed
Please refer to Part II, Item 8, Financial Statements , Note 13 and Note 7 of the notes to the consolidated financial statements for further information regarding the Option and Asset Purchase Agreement with the strategic partner and held for sale classification.
Added
Tranche 2 7,233 $ 10.37 — — NeoLight, LLC 105,048 $ 7.62 — — MolecuLight, Inc. 394,322 C$ 0.84 — — Assets Revenue Recognized Total gross finance receivables $ 225,905 $ 38,439 Total marketable investments 184 — Fair value of warrant assets 5,913 — Total $ 232,002 $ 38,439 (1) US royalty was paid off in a prior period but the Company continues to receive insignificant royalties on international sales.
Removed
(2), (3) Oncology diagnosis 5,784 2,347 — Coflex®/Kybella® Spinal stenosis/submental fullness 4,350 3,053 246 Cambia® (4) NSAID migraine treatment 8,500 — 420 Duo Royalty Japanese Women's health/cystic fibrosis 15,353 11,231 2,346 Flowonix Medical, Inc. (3),(5) Drug delivery device 12,455 8,433 — Forfivo XL® Depressive disorder treatment 6,000 1,267 1,239 Ideal Implant, Inc.
Removed
(3), (6) Aesthetics 4,025 3,050 — Immune Globulin Immune Globulin Therapeutics 14,100 11,685 1,729 Iluvien® Diabetic macular edema 16,501 15,865 1,774 Relief Rare Disease Portfolio 7,701 8,005 490 Veru, Inc (7) Women's health 10,000 — 582 22 Term Loans Type Maturity Date Principal GAAP Balance Rate Revenue Recognized 4Web, Inc.
Removed
First lien 8/18/28 22,500 22,774 12.3 % 2,884 MolecuLight, Inc. First lien 12/29/27 10,881 11,930 12.8 % 2,617 Nicoya Lifesciences, Inc.
Removed
TBD — — — 23 Assets Revenue Recognized Total gross finance receivables $ 289,009 $ 40,787 Total marketable investments 580 — Fair value of warrant assets 4,366 — Total $ 293,955 $ 40,787 (1) US royalty was paid off during the year ended December 31, 2021. SWK continues to receive insignificant royalties on international sales. (2) Investment considered partially impaired.
Removed
(3) Investment on non-accrual. (4) Carrying value was paid off during the year ended December 31, 2023. SWK continues to receive royalties on actual sales. (5) Flowonix Medical assets were sold to a medical device company during the year ended December 31, 2023.
Removed
(7) The Veru royalty was repaid during the year ended 2024. (8) AOTI warrants exercised and converted to shares. (9) Investment paid off during the year ended December 31, 2024. (10) Exercise price is converted from 0.111 British Pound per share.
Removed
Other administrative service revenues are recognized when contractual obligations are fulfilled or as services are provided. Pharmaceutical Development Segment Our Pharmaceutical Development segment enters into collaboration and licensing agreements with strategic partners, under which it may exclusively license rights to research, develop, manufacture and commercialize its product candidates to third parties.
Removed
The terms of these arrangements typically include payment to us of one or more of the following: non-refundable, upfront license fees; reimbursement of certain costs; customer option exercise fees; development, regulatory and commercial milestone payments; and royalties on net sales of licensed products.
Removed
In determining the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements, we perform the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.
Removed
As part of the accounting for these arrangements, the Company must use its judgment to determine: (a) the number of performance obligations based on the determination under step (ii) above; (b) the transaction price under step (iii) above; (c) the stand‑alone selling price for each performance obligation identified in the contract for the allocation of transaction price in step (iv) above; and d) the contract term and pattern of satisfaction of the performance obligations under step (v) above.
Removed
Management uses judgment to determine whether milestones or other variable consideration, except for royalties, should be included in the transaction price as described further below.
Removed
The transaction price is allocated to each performance obligation on a relative stand‑alone selling price basis, for which the Company recognizes revenue as or when the performance obligations under the contract are satisfied. 25 Amounts received prior to satisfying the revenue recognition criteria are recorded as deferred revenue in our consolidated balance sheets.
Removed
Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as current deferred revenue. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, net of current portion.
Removed
Most of the change was related to a $8.1 million impairment on the Trio loan and $2.2 million impairment on the Exeevo loan that were included within the provision for credit losses during the year ended December 31, 2024. Impairment of Goodwill We recognized a $8.4 million impairment charge during the year ended December 31, 2023.
Removed
As part of the Company's annual goodwill impairment analysis, the Company elected to bypass the qualitative goodwill impairment assessment and proceed directly with a quantitative assessment. The goodwill impairment test concluded that the fair value of the Company's Pharmaceutical Development reporting unit did not exceed the carrying amount and the Company recognized an impairment.
Removed
The $1.2 million decrease was primarily due to a reduction in research and development and clinical trial expenditures related to cancelled projects during the period.
Removed
The $6.8 million increase includes a $2.5 million gain on revaluation related to the Iluvien royalty after a contractual re-negotiation, a $2.4 million increase in unrealized gains on warrants, a $1.1 million gain on asset payoff, and a gain of $0.6 million due to foreign currency transactions.
Removed
As of December 31, 2024, there was $6.2 million outstanding amount under the new Credit Agreement, and $35.6 million was available for borrowing.
Removed
On October 27, 2023, the underwriters exercised their option to purchase an additional approximately $3.0 million in aggregate principal amount of the Notes.
Removed
The Notes will mature on January 31, 2027, unless earlier redeemed, and will bear interest at a rate of 9.00% per annum, payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year and at maturity, commencing on December 31, 2023.
Removed
The Company received net proceeds after discounts, commissions, expenses and fees, of approximately $30.6 million. See Note 8 for more information.
Removed
We continue to evaluate multiple attractive opportunities that, if consummated, we believe would similarly generate additional income. Since the timing of any investment is difficult to predict, our Finance Receivables segment may not be able to generate positive cash flow above what our existing assets are expected to produce in 2025.
Removed
These transactions involve, to varying degrees, elements of credit, interest rate, and liquidity risk. Such transactions are used primarily to manage partner companies’ requests for funding and take the form of loan commitments and lines of credit.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

2 edited+0 added−0 removed10 unchanged
Biggest changeITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK During the year ended December 31, 2024, our cash and cash equivalents were deposited in accounts at well capitalized financial institutions. The fair value of our cash and cash equivalents at December 31, 2024 approximated its carrying value.
Biggest changeITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK During the year ended December 31, 2025, our cash and cash equivalents were deposited in accounts at well capitalized financial institutions. The fair value of our cash and cash equivalents at December 31, 2025 approximated its carrying value.
In addition, any projected future decreases in our partner companies’ operating results due to inflation could adversely impact the fair value of those investments. Any decreases in the fair value of our investments could result in future unrealized losses and therefore reduce carrying value of our net assets. 30
In addition, any projected future decreases in our partner companies’ operating results due to inflation could adversely impact the fair value of those investments. Any decreases in the fair value of our investments could result in future unrealized losses and therefore reduce carrying value of our net assets. 34

Other SWKH 10-K year-over-year comparisons