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What changed in Lantheus Holdings, Inc.'s 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of Lantheus Holdings, Inc.'s 2022 and 2023 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 2023 report.

+593 added−574 removedSource: 10-K (2024-02-22) vs 10-K (2023-02-23)

Top changes in Lantheus Holdings, Inc.'s 2023 10-K

593 paragraphs added · 574 removed · 431 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

174 edited+61 added−49 removed179 unchanged
Biggest changeThe markets into which any of our product candidates would be launched, if approved, are also highly competitive and continually evolving. • For PNT2002 and 1095, our principal competitors in the field of mCRPC for radiopharmaceutical therapeutics may include Novartis AG; Telix Pharmaceuticals Limited; Curium and Bayer HealthCare Pharmaceuticals Inc., each of which have product candidates in development. • For PNT2003, our principal competitor may include Novartis AG. • For flurpiridaz, our principal competitors may include rubidium generators from Bracco and Jubilant Radiopharma.
Biggest changeThe markets into which any of our product candidates would be launched, if approved, are also highly competitive and continually evolving. • For PNT2002 and 1095, our principal competitors may include Novartis AG; Telix Pharmaceuticals Limited; and Curium, each of which has commercialized products or product candidates in advanced clinical stage of development. • For PNT2003, our principal competitor may include Novartis AG; ITM Radiopharma; and RayzeBio (under agreement to be acquired by Bristoll Meyers Squibb), each of which has commercialized products or product candidates in advanced clinical stage development. • For MK-6240, our principal competitors may include Eli Lilly and Company and Life Molecular Imaging, each of which has commercialized products or product candidates in advanced clinical stage of development. • For LNTH-1363S, our principal competitors may include Sofie Bioscience; GE Healthcare; and Novartis AG, each of which has product candidates in clinical stage of development.
PYLARIFY works by binding to PSMA, a protein that is overexpressed on the surface of more than 90% of primary and metastatic prostate cancer cells. PYLARIFY works with PET/CT technology to produce a combined PET/CT scan that enables the reader of the PET/CT scan to detect and locate the disease.
PYLARIFY works by binding to PSMA, a protein that is overexpressed on the surface of more than 90% of primary and metastatic prostate cancer cells. PYLARIFY works with PET/CT technology to produce a combined scan that enables the scan reader to detect and locate the disease.
We believe that our substantial capital investments in our highly automated generator production line and our other manufacturing assets, which we have made over the years, and our extensive experience in complying with the stringent regulatory requirements for the handling of nuclear materials and operations in a highly regulated environment, create significant and sustainable competitive advantages for us.
We believe that our substantial capital investments in our automated generator production line and our other manufacturing assets, which we have made over the years, and our extensive experience in complying with the stringent regulatory requirements for the handling of nuclear materials and operations in a highly regulated environment, create significant and sustainable competitive advantages for us.
We have expertise in the design, development and validation of complex manufacturing systems and processes, and our strong execution and quality control culture supports the just-in-time manufacturing model at our manufacturing facilities.
We have expertise in the design, development and validation of complex manufacturing systems and processes, and our strong execution and quality control culture supports the just-in-time manufacturing model at our facilities.
In addition, distributors of our products could attempt to shift end-users to competing diagnostic modalities and products, or bundle the sale of a portfolio of products, to the detriment of our specific products. Our current or future products could be rendered obsolete or uneconomical as a result of these activities.
In addition, distributors of our products could attempt to shift end-users to competing modalities and products, or bundle the sale of a portfolio of products, to the detriment of our specific products. Our current or future products could be rendered obsolete or uneconomical as a result of these activities.
In the U.S. for DEFINITY, we have six Orange Book-listed method of use patents, one of which expires in 2035 and five of which expire in 2037, as well as additional manufacturing patents that are not Orange Book-listed expiring in 2023 and 2037.
In the U.S. for DEFINITY, we have six Orange Book-listed method-of-use patents, one of which expires in 2035 and five of which expire in 2037, as well as additional manufacturing patents that are not Orange Book-listed expiring in 2037.
In the U.S. for DEFINITY, we have six Orange Book-listed method of use patents, one of which expires in 2035 and five of which expire in 2037, as well as additional manufacturing patents that are not Orange Book-listed expiring in 2023 and 2037.
In the U.S. for DEFINITY, we have six Orange Book-listed method-of-use patents, one of which expires in 2035 and five of which expire in 2037, as well as additional manufacturing patents that are not Orange Book-listed expiring in 2037.
Concurrent with clinical studies, companies usually complete additional animal studies and must also develop additional information about the chemistry and physical characteristics of the product and finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements.
Concurrent with clinical trials, companies usually complete additional animal studies and must also develop additional information about the chemistry and physical characteristics of the product and finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements.
Under existing Medicare policy for the hospital outpatient setting of care, non-pass-through diagnostic radiopharmaceuticals are not separately paid and are instead packaged into payment for the underlying procedure. Therapeutic radiopharmaceuticals are paid separately by Medicare OPPS regardless of pass-through status.
Under existing Medicare policy for the hospital outpatient setting of care, non-pass-through diagnostic radiopharmaceuticals are not separately paid and are instead packaged into payment for the underlying procedure. Therapeutic radiopharmaceuticals are paid separately by Medicare OPPS regardless of TPT Status.
Once the IND becomes effective, including review and approval by any IRB serving any of the institutions participating in the clinical trial, the clinical trial program may begin. Each new clinical trial protocol must be submitted to the FDA before the study may begin.
Once the IND becomes effective, including review and approval by any IRB serving any of the institutions participating in the clinical trial, the clinical trial program may begin. Each new clinical trial protocol must be submitted to the FDA before the trial may begin.
According to the American Cancer Society, prostate cancer is the second most common cancer in American men - one in eight American men will be diagnosed with prostate cancer in their lifetimes and over 3.2 million American men are living with prostate cancer today.
According to the American Cancer Society, prostate cancer is the second most common cancer in American men - one in eight American men will be diagnosed with prostate cancer in their lifetimes and over 3.3 million American men are living with prostate cancer today.
In the event a 505(b)(2) applicant does not rely on studies related to the innovator product, the 30-month stay would not apply, but additional clinical studies may be required.
In the event a 505(b)(2) applicant does not rely on studies related to the innovator product, the 30-month stay would not apply, but additional clinical trials may be required.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations - Comparison of the Periods Ended December 31, 2022 and 2021 - Revenues” for further information on revenue contributed by DEFINITY. TechneLite TechneLite is a self-contained system or generator of Tc-99m, a radioactive isotope with a six hour half-life, used by radiopharmacies to prepare various nuclear imaging agents.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations - Comparison of the Periods Ended December 31, 2023 and 2022 - Revenues” for further information on revenue contributed by DEFINITY. TechneLite TechneLite is a self-contained system or generator of Tc-99m, a radioactive isotope with a six hour half-life, used by radiopharmacies to prepare various nuclear imaging agents.
The manufacturing process must be capable of consistently producing quality batches of the agent and, among other things, the manufacturer must develop methods for testing the identity, strength, quality and purity of the final product.
The manufacturing process must be capable of consistently producing quality batches of the product and, among other things, the manufacturer must develop methods for testing the identity, strength, quality and purity of the final product.
In 2022, CMS established an ASP for PYLARIFY and reimbursed at a rate equal to ASP plus an add-on percentage that varied throughout the year. PYLARIFY has been assigned Healthcare Common Procedure Coding System code A9595 (piflufolastat F 18, diagnostic, 1 millicurie) for identification in claims and can be used by both public and private payors.
In 2023, CMS established an ASP for PYLARIFY and reimbursed at a rate equal to ASP plus an add-on percentage that varied throughout the year. PYLARIFY has been assigned Healthcare Common Procedure Coding System code A9595 (piflufolastat F 18, diagnostic, 1 millicurie) for identification in claims and can be used by both public and private payors.
We cannot anticipate the actions of our current or future competitors in the same or competing diagnostic modalities, such as significant price reductions on products that are comparable to our own, development of new products or other technologies that are more cost-effective or have superior performance than our current products or the introduction of generic versions after our proprietary products lose their patent protection.
We cannot anticipate the actions of our current or future competitors in the same or competing therapeutic and diagnostic modalities, such as significant price reductions on products that are comparable to our own, development of new products or other technologies that are more cost-effective or have superior performance than our current products or the introduction of generic versions after our proprietary products lose their patent protection.
Exclusive License for PNT2002 & PNT2003 On December 20, 2022, we announced the closing of a set of strategic collaborations with an affiliate of POINT, in which we were granted a license to exclusive worldwide rights (excluding Japan, South Korea, China (including Hong Kong, Macau and Taiwan), Singapore and Indonesia) to co-develop and commercialize POINT’s PNT2002 and PNT2003 product candidates.
Exclusive License for PNT2002 & PNT2003 On December 20, 2022, we announced the closing of a set of strategic collaborations with POINT, in which we were granted a license to exclusive worldwide rights (excluding Japan, South Korea, China (including Hong Kong, Macau and Taiwan), Singapore and Indonesia) to co-develop and commercialize POINT’s PNT2002 and PNT2003 product candidates.
Further, the failure to maintain compliance with regulatory requirements may result in administrative or judicial actions, such as fines, civil monetary penalties, warning letters, holds on clinical studies, product recalls or seizures, product detention or refusal to permit the import or export of products, refusal to approve pending applications or supplements, restrictions on marketing or manufacturing, injunctions, or civil or criminal penalties.
Further, the failure to maintain compliance with regulatory requirements may result in administrative or judicial actions, such as fines, civil monetary penalties, warning letters, holds on clinical trials, product recalls or seizures, product detention or refusal to permit the import or export of products, refusal to approve pending applications or supplements, restrictions on marketing or manufacturing, injunctions, or civil or criminal penalties.
PYLARIFY has received pass-through status effective January 1, 2022 through December 31, 2024, thereby providing separate reimbursement to customers using PYLARIFY in the hospital outpatient setting during this specified period. The reimbursement rate for PYLARIFY was initially based on the wholesale acquisition cost (WAC) plus three percent until ASP could be established.
PYLARIFY has received TPT Status effective January 1, 2022 through December 31, 2024, thereby providing separate reimbursement to customers using PYLARIFY in the hospital outpatient setting during this specified period. The reimbursement rate for PYLARIFY was initially based on the wholesale acquisition cost (WAC) plus three percent until ASP could be established.
The software is currently used as one of the correlative objectives of the DORA trial, an open-labeled, randomized, phase III study of docetaxel versus docetaxel in combination with radium-223 (Ra-223) in subjects with mCRPC. aBSI is also approved in Japan and part of the JSMO guidelines (Japanese Society of Medical Oncology) in support of clinicians with patient treatment selection.
The software is currently used as one of the correlative objectives of the DORA trial, an open-labeled, randomized, Phase 3 study of docetaxel versus docetaxel in combination with radium-223 (Ra-223) in subjects with mCRPC. aBSI is also approved in Japan and part of the JSMO guidelines (Japanese Society of Medical Oncology) in support of clinicians with patient treatment selection.
In addition, the FDA may require Phase 4 testing which involves clinical studies designed to further assess a drug product’s safety and effectiveness after NDA approval. The FDA also may impose one or more Risk Evaluation and Mitigation Strategies (“REMS”) to ensure that the benefits of a product outweigh its risks.
In addition, the FDA may require Phase 4 testing which involves clinical trials designed to further assess a drug product’s safety and effectiveness after NDA approval. The FDA also may impose one or more Risk Evaluation and Mitigation Strategies (“REMS”) to ensure that the benefits of a product outweigh its risks.
Federal law also requires the sponsor to register the trials on public databases when they are initiated, and to disclose the results of the trials on public databases upon completion. Phase 1, Phase 2 and Phase 3 testing may not be completed successfully within any specified period, if at all.
Federal law also requires the sponsor to register the trials on public databases when they are initiated, and to disclose the results of the trials on public databases upon completion. Phase 1, Phase 2 and Phase 3 clinical trials may not be completed successfully within any specified period, if at all.
In the case of some products for severe or life-threatening diseases, especially when the agent may be too inherently toxic to ethically administer to healthy volunteers, the initial human testing is often conducted in patients with those diseases. • Phase 2.
In the case of some products for severe or life-threatening diseases, especially when the product may be too inherently toxic to ethically administer to healthy volunteers, the initial human testing is often conducted in patients with those diseases. • Phase 2.
Further, we own a U.S. patent and have patent applications that are pending in the U.S. and worldwide relating to aBSI improvements, which have expiration ranging from 2040 to 2041. 17 Table of Contents flurpiridaz - We own patents and patent applications in numerous jurisdictions covering composition, use, formulation and manufacturing, including in the U.S. a composition of matter patent expiring in 2026, a formulation patent expiring in 2032, a method of use patent expiring in 2028, and manufacturing-related patents expiring in 2031 and 2033, and various patent applications, some of which, if granted, will expire in 2033.
Further, we own a U.S. patent and have patent applications that are pending in the U.S. and worldwide relating to aBSI improvements, which have expiration ranging from 2040 to 2041. flurpiridaz - We own patents and patent applications in numerous jurisdictions covering composition, use, formulation and manufacturing, including in the U.S. a composition of matter patent expiring in 2026, a formulation patent expiring in 2032, a method-of-use patent expiring in 2028, and manufacturing-related patents expiring in 2031 and 2033, and various patent applications, some of which, if granted, will expire in 2033.
Currently, the process required by the FDA before a drug product may be marketed in the U.S. generally involves the following: • Completion of preclinical laboratory tests, animal studies and formulation studies according to current Good Laboratory Practices regulations; 18 Table of Contents • Submission to the FDA of an investigational new drug application (“IND”) which must become effective before human clinical studies may begin, including review and approval by any institutional review board (“IRB”), serving any of the institutions participating in the clinical studies; • Performance of adequate and well-controlled human clinical studies according to current Good Clinical Practices and other requirements, to establish the safety and efficacy of the proposed drug product for its intended use; • Submission to the FDA of a new drug application (“NDA”) for a new drug; • Satisfactory completion of an FDA inspection of the manufacturing facility or facilities at which the drug product is produced to assess compliance with current Good Manufacturing Practices (“cGMPs”) regulations; and • FDA review and approval of the NDA.
Currently, the process required by the FDA before a drug product may be marketed in the U.S. generally involves the following: • Completion of preclinical laboratory tests, animal studies and formulation studies according to current Good Laboratory Practices regulations; • Submission to the FDA of an investigational new drug application (“IND”) which must become effective before human clinical trials may begin, including review and approval by any institutional review board (“IRB”), serving any of the institutions participating in the clinical trials; • Performance of adequate and well-controlled human clinical trials according to current Good Clinical Practices and other requirements, to establish the safety and efficacy of the proposed drug product for its intended use; • Submission to the FDA of an NDA for a new drug; • Satisfactory completion of an FDA inspection of the manufacturing facility or facilities at which the drug product is produced to assess compliance with current Good Manufacturing Practices (“cGMPs”) regulations; and • FDA review and approval of the NDA.
The CPRA amends the CCPA and expands its protections for personal information, including by establishing a new California Privacy Protection Agency to enforce the CPRA and by providing California consumers various rights such as the right to restrict the processing of their “sensitive personal information.” The CPRA’s amendments to the CCPA take effect on January 1, 2023, and generally will apply to personal information collected by regulated businesses on or after January 1, 2022.
The CPRA amends the CCPA and expands its protections for personal information, including by establishing a new California Privacy Protection Agency to enforce the CPRA and by providing California consumers various rights such as the right to restrict the processing of their “sensitive personal information.” The CPRA’s amendments to the CCPA took effect on January 1, 2023, and generally apply to personal information collected by regulated businesses on or after January 1, 2022.
We commercially launched aPROMISE under the name PYLARIFY AI in the U.S. in November 2021 and the FDA granted us an additional 510(k) clearance during the second quarter of 2022. [ 18 F] flurpiridaz • GE Healthcare Agreement – In April 2017, we announced entering into a definitive, exclusive Collaboration and License Agreement with GE Healthcare for the continued Phase 3 development and worldwide commercialization of flurpiridaz, a fluorine 18-based PET MPI agent designed to assess blood flow to the heart in patients suspected of coronary artery disease (“CAD”).
We commercially launched aPROMISE under the name PYLARIFY AI in the U.S. in November 2021 and the FDA granted us an additional 510(k) clearance during the second quarter of 2022. [ 18 F] flurpiridaz • GE Healthcare Agreement – In 2017, we entered into a definitive, exclusive Collaboration and License Agreement with GE Healthcare for the continued Phase 3 development and worldwide commercialization of flurpiridaz, a fluorine 18-based PET MPI agent designed to assess blood flow to the heart in patients suspected of coronary artery disease (“CAD”).
The IRA also introduces rebate obligations for manufacturers of Part B and D drugs that take price increases which exceed the rate of inflation, similar to the longstanding Medicaid inflation rebates. Under these new Medicare inflation rebates, each Part B and D single-source drug/biological and biosimilar will have an “inflation adjusted” payment amount calculated by CMS.
The IRA also introduces rebate obligations for manufacturers of Part B and D drugs that take price increases which exceed the rate of inflation, similar to the longstanding Medicaid inflation rebates. Under these new Medicare inflation rebates, each Part B and D 23 Table of Contents single-source drug/biological and biosimilar will have an “inflation adjusted” payment amount calculated by CMS.
Progress reports detailing the results of the clinical studies must be submitted at least annually to the FDA and safety reports must be submitted to the FDA and the investigators for serious and unexpected adverse events. Submissions must also be made to inform the FDA of certain changes to the clinical trial protocol.
Progress reports detailing the results of the clinical trials must be submitted at least annually to the FDA and safety reports must be submitted to the FDA and the investigators for serious and unexpected adverse events. Submissions must also be made to inform the FDA of certain changes to the clinical trial protocol.
Even if such data and information are submitted, the FDA may ultimately decide that the NDA does not satisfy the criteria for approval. Data obtained from clinical studies are not always conclusive, and the FDA may interpret data differently than we interpret the same data.
Even if such data and information are submitted, the FDA may ultimately decide that the NDA does not satisfy the criteria for approval. Data obtained from clinical trials are not always conclusive, and the FDA may interpret data differently than we interpret the same data.
Because of the short half-lives of Mo-99 and Tc-99m, radiopharmacies typically purchase TechneLite generators on a weekly basis pursuant to standing orders. 6 Table of Contents The Tc-99m produced by our TechneLite generator is the medical radioisotope that can be attached to a number of imaging agents, including our own NEUROLITE and CARDIOLITE products, during the radiolabeling process.
Because of the short half-lives of Mo-99 and Tc-99m, radiopharmacies typically purchase TechneLite generators on a weekly basis pursuant to standing orders. The Tc-99m produced by our TechneLite generator is the medical radioisotope that can be attached to a number of imaging agents, including our own NEUROLITE and CARDIOLITE products, during the radiolabeling process.
The FDA may on occasion require the sponsor of an NDA to conduct additional clinical studies or to provide other scientific or technical information about the product, and these additional requirements may lead to unanticipated delay or expense.
The FDA may on occasion require the sponsor of an NDA to conduct additional clinical trials or to provide other scientific or technical information about the product, and these additional requirements may lead to unanticipated delay or expense.
(“Insightec”), which will use our microbubbles in connection with the development of Insightec’s transcranial guided focused ultrasound device for the treatment of glioblastoma as well as other neurodegenerative conditions; and (iv) Allegheny Health Network (“AHN”) which will use our microbubbles in combination with AHN’s ultrasound-assisted non-viral gene transfer technology for the development of a proposed treatment of xerostomia.
(“Insightec”), which will use our microbubbles in connection with the development of Insightec’s transcranial guided focused ultrasound device for the treatment of glioblastoma as well as other neurodegenerative conditions; (iv) Allegheny Health Network (“AHN”) which will use our microbubbles in combination with AHN’s ultrasound-assisted non-viral gene transfer technology for the development of a proposed treatment of xerostomia; and (v) SonoThera, Inc.
Under our agreement, GE Healthcare will complete the development of flurpiridaz, pursue worldwide regulatory 10 Table of Contents approvals, and, if successful, lead a worldwide launch and commercialization of the agent, with us collaborating on both development and commercialization through a joint steering committee. We also have retained the right to co-promote the agent in the U.S.
Under our agreement, GE Healthcare will complete the development of flurpiridaz, pursue worldwide regulatory approvals, and, if successful, lead a worldwide launch and commercialization of the agent, with us collaborating on both development and commercialization through a joint steering committee. We also have retained the right to co-promote the agent in the U.S.
Under a strategic agreement entered into in 2021, we receive from IRE bulk unprocessed Xenon, which we process and finish for our customers at our North Billerica, Massachusetts manufacturing facility. That contract runs through December 31, 2023, with auto-renewal provisions and terminable upon notice of non-renewal.
Under a strategic agreement entered into in 2021, we receive from IRE bulk unprocessed Xenon, which we process and finish for our customers at our North Billerica, Massachusetts manufacturing facility. That contract runs through December 31, 2025, with auto-renewal provisions and is terminable upon notice of non-renewal.
When a quality or regulatory issue is identified, we investigate the issue and take appropriate corrective action, such as withdrawal of the product from the market, correction of the product at the customer location, notice to the customer of revised labeling and other actions. Hatch-Waxman Act The Hatch-Waxman Act added two pathways for FDA drug approval.
When a quality or regulatory issue is identified, we investigate the issue and take appropriate corrective action, such as withdrawal of the product from the market, correction of the product at the customer location, notice to the customer of revised labeling and other actions. 21 Table of Contents Hatch-Waxman Act The Hatch-Waxman Act added two pathways for FDA drug approval.
Governmental regulatory actions can result in the seizure or recall of products, suspension or revocation of the authority necessary for their production and sale as well as other civil or criminal sanctions. Our activities related to the development, manufacture, packaging or repackaging of our products subject us to a wide variety of laws and regulations.
Governmental regulatory actions can result in the seizure or recall of products, suspension or revocation of the authority necessary for their production and sale as well as other civil or criminal sanctions. 18 Table of Contents Our activities related to the development, manufacture, packaging or repackaging of our products subject us to a wide variety of laws and regulations.
Our activities relating to the sale and marketing of our products may be subject to scrutiny under these laws. Laws and regulations have also been enacted by the U.S. federal government and various states, as well as by countries outside of the U.S., to regulate the sales and marketing practices of certain entities including pharmaceutical and device manufacturers.
Our activities relating to the sale and marketing of our products may be subject to scrutiny under these laws. 24 Table of Contents Laws and regulations have also been enacted by the U.S. federal government and various states, as well as by countries outside of the U.S., to regulate the sales and marketing practices of certain entities including pharmaceutical and device manufacturers.
Failure to comply with data protection laws and regulations could result in government enforcement actions (which could include civil or criminal penalties and requirements to take corrective 24 Table of Contents actions), private litigation (which may result in the award of damages against us), and/or adverse publicity, and could negatively affect our operating results, business, and reputation.
Failure to comply with data protection laws and regulations could result in government enforcement actions (which could include civil or criminal penalties and requirements to take corrective actions), private litigation (which may result in the award of damages against us), and/or adverse publicity, and could negatively affect our operating results, business, and reputation.
PYLARIFY - We actively pursue patents in connection with PYLARIFY, both in the U.S. and internationally. In the U.S. for PYLARIFY, we have four Orange Book-listed patents, including composition of matter patents, the last of which expire in 2037.
PYLARIFY - We actively pursue patents in connection with PYLARIFY, both in the U.S. and internationally. In the U.S. for PYLARIFY, we have five Orange Book-listed patents, including composition of matter patents, the last of which expire in 2037.
We believe we are currently the leading worldwide provider of ultrasound enhancing agents. • TechneLite is a Technetium (“Tc-99m”) generator that provides the essential nuclear material used by radiopharmacies to radiolabel NEUROLITE, CARDIOLITE and other Tc-99m-based radiopharmaceuticals used in nuclear medicine procedures.
We believe we are currently the leading worldwide provider of ultrasound enhancing agents for use in echocardiography. • TechneLite is a Technetium (“Tc-99m”) generator that provides the essential nuclear material used by radiopharmacies to radiolabel NEUROLITE, CARDIOLITE and other Tc-99m-based radiopharmaceuticals used in nuclear medicine procedures.
We constructed a specialized in-house manufacturing facility at our North Billerica campus for purposes of producing this formulation of DEFINITY and, potentially, other sterile vial products. On February 22, 2022, we received FDA approval of our supplemental new drug application (“sNDA”), authorizing commercial manufacturing of this formulation of DEFINITY at our new facility.
We constructed a specialized in-house manufacturing facility at our North Billerica campus for purposes of 8 Table of Contents producing this formulation of DEFINITY and, potentially, other sterile vial products. On February 22, 2022, we received FDA approval of our supplemental new drug application (“sNDA”), authorizing commercial manufacturing of this formulation of DEFINITY at our new facility.
We are evaluating a number of different opportunities to collaborate, in-license or acquire additional products, product candidates, businesses and technologies to drive our future growth. In particular, we are focused on late-stage diagnostic and therapeutic product opportunities in oncology and other strategic areas that complement our existing portfolio.
We are evaluating a number of different opportunities to collaborate, in-license or acquire additional products, product candidates, businesses and technologies to drive our future growth. In particular, we are focused on radiopharmaceutical therapeutic and diagnostic product opportunities in oncology and other strategic areas that complement our existing portfolio.
TechneLite is currently marketed primarily in the U.S., Canada, Central America and South America, largely to radiopharmacies that prepare unit doses of radiopharmaceutical imaging agents and ship these preparations directly to hospitals for administration to patients. In the U.S., we have supply contracts with large radiopharmacy groups, including Cardinal Health (“Cardinal”), RLS (USA) Inc.
TechneLite is currently marketed primarily in the U.S., Canada, Central America and South America, largely to radiopharmacies that prepare unit doses of radiopharmaceutical imaging agents and ship these preparations directly to hospitals for administration to patients. In the U.S., we have supply contracts with large radiopharmacy groups, including PharmaLogic Holdings Corp (“PharmaLogic”), Cardinal Health (“Cardinal”), RLS (USA) Inc.
Our reports filed with, or furnished to, the SEC are also available on the SEC’s website at www.sec.gov, and for Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, in an Inline Extensible Business Reporting Language (“iXBRL”) format. iXBRL is an electronic coding language used to create interactive financial statement data over the Internet.
Our reports filed with, or furnished to, the SEC are also available on the SEC’s website at www.sec.gov, and for Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, in an Inline Extensible Business Reporting Language (“iXBRL”) format. iXBRL is an electronic coding language used to create interactive financial statement data over the Internet. 28 Table of Contents
In addition, given the significant know-how and trade secrets associated with the methods of manufacturing and assembling the TechneLite generator, we believe we have a substantial amount of valuable and defensible proprietary intellectual property associated with the product. PYLARIFY AI - U.S.
In addition, given the significant know-how and trade secrets associated with the methods of manufacturing and assembling the TechneLite generator, we believe we have a substantial amount of valuable and defensible proprietary intellectual property associated with the product. 17 Table of Contents PYLARIFY AI - U.S.
We cannot predict what impact new owners and new operators may have on the strategic decision-making of our competitors, customers and suppliers. 13 Table of Contents Raw Materials and Supply Relationships We rely on certain raw materials and supplies to produce our products.
We cannot predict what impact new owners and new operators may have on the strategic decision-making of our competitors, customers and suppliers. Raw Materials and Supply Relationships We rely on certain raw materials and supplies to produce our products.
While a small portion of our nuclear imaging product sales in the U.S. are generated through our direct sales force to hospitals and clinics that maintain their own in-house radiopharmaceutical preparation capabilities, we primarily sell our nuclear imaging products, including TechneLite, NEUROLITE, Xenon, and CARDIOLITE, to large radiopharmacy groups.
While a small portion of our nuclear imaging product sales in the U.S. are generated through our internal sales force to hospitals and clinics that maintain their own in-house radiopharmaceutical preparation capabilities, we primarily sell our nuclear imaging products, including TechneLite, NEUROLITE, Xenon, and CARDIOLITE, to large radiopharmacy chains.
Solely by way of example and not based on any knowledge we currently have, if we received a Notice from an Applicant in March 2023 and the full 30-month stay were obtained, then the Applicant would be precluded from commercialization until at least September 2025.
Solely by way of example and not based on any knowledge we currently have, if we received a Notice from an Applicant in March 2024 and the full 30-month stay were obtained, then the Applicant would be precluded from commercialization until at least September 2026.
The testing and approval process requires substantial time, effort, and financial resources, and we cannot be certain that any approvals for our agents in development will be granted on a timely basis, if at all. Once a pharmaceutical agent is identified for development, it enters the preclinical testing stage.
The testing and approval process requires substantial time, effort, and financial resources, and we cannot be certain that any approvals for our products in development will be granted on a timely basis, if at all. Once a pharmaceutical product is identified for development, it enters the preclinical testing stage.
AZEDRA currently has the Orphan Drug designation in the United States. In the United States, Orphan Drug designation entitles a party to financial incentives such as opportunities for grant funding towards clinical trial costs, tax advantages and user-fee waivers.
In the United States, Orphan Drug designation entitles a party to financial incentives such as opportunities for grant funding towards clinical trial costs, tax advantages and user-fee waivers.
Our principal competitors for our current commercial products and leading clinical development candidates include large, global companies that are more diversified than we are and that have substantial financial, manufacturing, sales and marketing, distribution and other resources. • For PYLARIFY, our principal competitors are currently Telix Pharmaceuticals Limited and Novartis AG.
Our principal competitors for our current commercial products and leading clinical development candidates include large, global companies that are more diversified than we are and that have substantial financial, manufacturing, sales and marketing, distribution and other resources. • For PYLARIFY, our principal competitors are currently Telix Pharmaceuticals Limited, Novartis AG, and Blue Earth Diagonstics Ltd.
We are focused on pay equity and regularly assess pay among similar roles and responsibilities throughout our organization and in comparison to our peer group. Communication and Engagement 27 Table of Contents We believe that our success depends on employees understanding how their work contributes to our overall strategy.
We are focused on pay equity and regularly assess pay among similar roles and responsibilities throughout our organization and in comparison to our peer group. Communication and Engagement We believe that our success depends on employees understanding how their work contributes to our overall strategy.
We plan to continue our advocacy efforts with CMS and private insurers so that PYLARIFY customers will have appropriate and adequate reimbursement following the expiration of pass-through status.
We plan to continue our advocacy efforts with CMS and private insurers so that PYLARIFY customers will have appropriate and adequate reimbursement following the expiration of TPT Status.
The cloud based aBSI was made available for clinical use in the U.S. on August 5, 2019. In February 2020, Progenics received CE marking for the standalone workstation model of aBSI, meeting the quality standards set by the European Economic Area.
The cloud based aBSI was made available for clinical use in the U.S. on August 5, 2019. In February 2020, Progenics received European Conformity Marking (“CE marking”) for the standalone workstation model of aBSI, meeting the quality standards set by the European Economic Area.
Under the Hatch-Waxman Act, the FDA can approve Abbreviated New Drug Applications (“ANDAs”) for generic versions of drugs if the ANDA applicant demonstrates, among other things, that (i) its generic candidate is the same as the innovator product by establishing bioequivalence and providing relevant chemistry, manufacturing and product data, and (ii) either the marketing of that generic candidate does not infringe the Orange Book-listed patent(s) or the Orange Book-listed patent(s) is invalid.
Under the Hatch-Waxman Act, the FDA can approve ANDAs for generic versions of drugs if the ANDA applicant demonstrates, among other things, that (i) its generic candidate is the same as the innovator product by establishing bioequivalence and providing relevant chemistry, manufacturing and product data, and (ii) either the marketing of that generic candidate does not infringe the Orange Book-listed patent(s) or the Orange Book-listed patent(s) is invalid.
(“FUJIFILM”) under the name BONENAVI®. • aPROMISE, which is currently sold as PYLARIFY AI in the U.S., is artificial intelligence medical device software that is designed to allow healthcare professionals and researchers to perform standardized quantitative assessment of PSMA PET/CT images in prostate cancer, including those images obtained by using PYLARIFY.
(“FUJIFILM”) under the name BONENAVI®. • aPROMISE, which is currently commercialized as PYLARIFY AI in the U.S., is artificial intelligence medical device software that is designed to allow HCPs and researchers to perform standardized quantitative assessment of PSMA PET/CT images in prostate cancer, including those images obtained by using PYLARIFY.
PNT-2002 - We exclusively license granted U.S. patents and pending U.S. patent applications as well as pending patent applications in jurisdictions outside of the U.S. directed to formulations, use and manufacturing of PNT-2002. The granted U.S. patents expire in 2041.
PNT2002 - We exclusively license granted U.S. patents and pending U.S. patent applications as well as pending patent applications in jurisdictions outside of the U.S. directed to formulations, use and manufacturing of PNT2002. The granted U.S. patents expire in 2041.
These factors include governmental regulation, such as detailed inspection of and controls over research and laboratory procedures, clinical investigations, manufacturing, marketing, sampling, distribution, import and export, record keeping and storage and disposal practices, together with various post-marketing requirements.
These factors include governmental regulation, such as detailed inspection of and controls over research and laboratory procedures, clinical trials, manufacturing, marketing, advertising and promotion, sampling, distribution, import and export, record keeping and storage and disposal practices, together with various post-marketing requirements.
As of December 31, 2022, we had activated 37 PMF manufacturing sites in our PMF network, up from 21 activated sites as of December 31, 2021. These additional sites provide geographic breadth, out-the-door time flexibility and added optionality within our existing PMF network.
As of December 31, 2023, we had activated 54 PMF manufacturing sites in our PMF network, up from 37 activated sites as of December 31, 2022. These additional sites provide geographic breadth, out-the-door time flexibility and added optionality within our existing PMF network.
Involves studies in a limited patient population to identify possible adverse effects and safety risks, to evaluate preliminarily the efficacy of the agent for specific targeted diseases and to determine dosage tolerance and optimal dosage and schedule. • Phase 3.
Involves trials in a limited patient population to identify possible adverse effects and safety risks, to evaluate preliminarily the efficacy of the product for specific targeted diseases and to determine dosage tolerance and optimal dosage and schedule. • Phase 3.
Clinical studies are undertaken to further evaluate dosage, clinical efficacy and safety in an expanded patient population at geographically dispersed clinical study sites. These studies are intended to collect sufficient safety and efficacy data to support the NDA for FDA approval.
Clinical trials are undertaken to further evaluate dosage, clinical efficacy and safety in an expanded patient population at geographically dispersed clinical trial sites. These trials are intended to collect sufficient safety and efficacy data to support the NDA for FDA approval.
Similarly, any IRB serving any of the institutions participating in the clinical trial can suspend or terminate approval of a clinical study at a relevant institution if the clinical study is not being conducted in accordance with the IRB’s requirements or if the agent has been associated with unexpected serious harm to patients.
Similarly, any IRB serving any of the institutions participating in the clinical trial can suspend or terminate approval of a clinical trial at an institution if the clinical trial is not being conducted in accordance with the IRB’s requirements or if the product has been associated with unexpected serious harm to patients.
To this end, we utilize a variety of channels to facilitate open and direct communication, including: (i) quarterly town hall meetings for our entire company; (ii) regular ongoing update communications; and (iii) an externally administered whistleblower hotline and website that is prominently advertised to our employees, and a whistleblower’s anonymity is protected, if so requested.
To this end, we utilize a variety of channels to facilitate open and direct communication, including: (i) quarterly town hall meetings for our entire company; (ii) regular ongoing update communications, including through monthly newsletters and our recently launched intranet site; and (iii) an externally administered whistleblower hotline and website that is prominently advertised to our employees, and a whistleblower’s anonymity is protected, if so requested.
Radiopharmaceutical Oncology Our commercial products in our Radiopharmaceutical Oncology category include the following: • PYLARIFY (also known as piflufolastat F 18, 18F-DCFPyL or PyL) is an F 18-labelled PSMA-targeted PET imaging agent used with PET/computed tomography (“CT”).
Our Portfolio of Commercial Products Radiopharmaceutical Oncology Our commercial product in our Radiopharmaceutical Oncology category includes the following: • PYLARIFY (also known as piflufolastat F 18, 18F-DCFPyL or PyL) is an F 18-labelled PSMA-targeted PET imaging agent used with PET/computed tomography (“CT”).
The finished PYLARIFY is then quality control tested and transferred to a radiopharmacist who prepares and dispenses patient-specific doses of the final product. Because each of the PMFs manufacturing these products is deemed by the FDA to be a separate manufacturing site, each had to be separately approved by the FDA.
The finished PYLARIFY is then quality control tested and transferred to a radiopharmacist who prepares and dispenses patient-specific doses of the final product. Because each PMF manufacturing PYLARIFY is deemed by the FDA to be a separate manufacturing site, each is separately approved by the FDA.
Assuming that between 20% and 30% of echocardiograms produce suboptimal images, as stated in the clinical literature, we estimate that approximately 6 to 10 million echocardiograms in 2021 produced suboptimal images. Since its launch in 2001, DEFINITY has been used in imaging procedures in more than 21 million studies throughout the world.
Assuming that between 20% and 30% of echocardiograms produce suboptimal images, as stated in the clinical literature, we estimate that approximately 6 to 9 million echocardiograms in 2022 produced suboptimal images. Since its launch in 2001, DEFINITY has been used in imaging procedures in more than 25 million studies throughout the world.
The Orange Book-listed patents include a patent on the use of VIALMIX RFID (see below) which expires in 2037; we have submitted additional VIALMIX RFID patent applications in major markets throughout the world.
The Orange Book-listed patents include a patent on the use of VIALMIX RFID which expires in 2037; additional VIALMIX RFID patent applications have been submitted in major markets throughout the world.
Medicare Outpatient Pass-Through Payment Status Part B of the Medicare program generally reimburses medical services and supplies, including drugs, provided to beneficiaries by physicians and other qualified healthcare professionals.
Medicare Outpatient TPT Status Part B of the Medicare program generally reimburses medical services and supplies, including drugs, provided to beneficiaries by physicians and other qualified healthcare professionals.
The FDA or the clinical trial sponsor may suspend or terminate a clinical study at any time on various grounds, including a finding that the research subjects or patients are being exposed to an unacceptable health risk.
The FDA or the clinical trial sponsor may suspend or terminate a clinical trial at any time on various grounds, including a finding that the research subjects or patients are being 19 Table of Contents exposed to an unacceptable health risk.
See Part I, Item 1A. “Risk Factors” for information regarding certain risks associated with environmental matters. Human Capital Management As of December 31, 2022, we had 698 employees, of which 672 were located in the U.S. and 26 were located internationally.
See Part I, Item 1A. “Risk Factors” for information regarding certain risks associated with environmental matters. Human Capital Management As of December 31, 2023, we had 834 employees, of which 808 were located in the U.S. and 26 were located internationally.
DEFINITY is a clear, colorless, sterile liquid that, upon activation in a VIALMIX apparatus, a medical device specifically designed for DEFINITY, becomes a homogenous, opaque, milky white injectable suspension of perflutren-containing lipid microspheres.
DEFINITY is a clear, colorless, sterile liquid that, upon activation in a VIALMIX or VIALMIX RFID, medical devices specifically designed for DEFINITY, becomes a homogenous, opaque, milky white injectable suspension of perflutren-containing lipid microspheres.
The RFID tag, which is affixed to the vial label, enables the DEFINITY vial to be appropriately activated with the VIALMIX RFID activation device. With respect to manufacturing the formulation of DEFINITY that requires refrigeration, historically, we have relied on Jubilant HollisterStier (“JHS”) as a significant supplier of this formulation of DEFINITY.
The RFID tag, which is affixed to the vial label, enables the DEFINITY vial to be appropriately activated with the VIALMIX RFID activation device. To manufacture DEFINITY that requires refrigeration, historically, we have relied on Jubilant HollisterStier (“JHS”) as a significant supplier.
One formulation of DEFINITY requires refrigerated storage. Another formulation, which we have branded as DEFINITY RT, allows both storage and shipment at room temperature and provides clinicians an additional choice for greater utility of this formulation in broader clinical settings.
We offer two formulations of DEFINITY, one of which requires refrigerated storage (branded DEFINITY) and one which allows both storage and shipment at room temperature and provides clinicians an additional choice for greater utility of this formulation in broader clinical settings (branded DEFINITY RT).
“Management’s Discussion and Analysis of Financial Condition and Results of Operations - Comparison of the Periods Ended December 31, 2022 and 2021 - Revenues” for further information on total revenue contributed by PYLARIFY since its approval. Strategic Partnerships and Other Revenue We continue to seek ways to further increase the overall value of our portfolio of products and product candidates.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations - Comparison of the Periods Ended December 31, 2023 and 2022 - Revenues” for further information on revenue contributed by TechneLite. Strategic Partnerships and Other Revenue We continue to seek ways to further increase the overall value of our portfolio of products and product candidates.
We are also supporting trade associations in their efforts to have Congress pass the Facilitating Innovative Nuclear Diagnostics (FIND) Act, which would allow for separate payment for certain diagnostic radiopharmaceuticals, including PYLARIFY, similar to the way Medicare OPPS currently pays for other drugs, biologics, and therapeutic radiopharmaceuticals instead of under the current TPT structure of a separate payment that is limited to three years. 22 Table of Contents Healthcare Reform and Other Laws Affecting Payment We operate in a highly-regulated industry.
We are also supporting trade associations in their efforts to have Congress pass the Facilitating Innovative Nuclear Diagnostics (FIND) Act, which would allow for separate payment for certain diagnostic radiopharmaceuticals, including PYLARIFY, similar to the way Medicare OPPS currently pays for other drugs, biologics, and therapeutic radiopharmaceuticals instead of under the current TPT structure of a separate payment that is limited to three years.
In addition, in 2022, we entered into an agreement with Curium to add PYLARIFY to its U.S. ECLIPSE trial, a multi-center, open-label, randomized Phase 3 trial comparing the safety and efficacy of Curium’s PSMA-targeted therapeutic versus hormone therapy in patients with metastatic castration-resistant prostate cancer.
In addition, we previously entered into an agreement with Curium to add PYLARIFY to its U.S. ECLIPSE trial, a multi-center, open-label, randomized Phase 3 trial comparing the safety and efficacy of Curium’s PSMA-targeted therapeutic versus hormone therapy in patients mCRPC.
Patent term extensions, however, are subject to a maximum extension of five years, and the patent term extension cannot extend the remaining term of a patent beyond a total of 14 years. The application for patent term extension is subject to approval by the U.S.
Patent term extensions, however, are subject to a maximum extension of five years, and the patent term extension cannot extend the remaining term of a patent beyond a total of 14 years. The application for patent term extension is subject to approval by the U.S. Patent and Trademark Office in conjunction with the FDA.
DEFINITY and the agents produced by GE Healthcare and Bracco all carry an FDA-required boxed warning, which has been modified over time, to notify physicians and patients about potentially serious safety concerns or risks posed by the products. See Part I, Item 1A.
DEFINITY and the other FDA-approved ultrasound enhancing agents all carry an FDA-required boxed warning, which has been modified over time, to notify physicians and patients about potentially serious safety concerns or risks posed by the products. See Part I, Item 1A.
Compliance with the CCPA is a rigorous and time-intensive process that may increase the cost of doing business or require companies to change their business practices to ensure full compliance. On November 3, 2020, California passed the California Privacy Rights Act (“CPRA”) through a ballot initiative.
Compliance with the CCPA, and similar laws implemented in other states, is a rigorous and time-intensive process that may increase the cost of doing business or require companies to change their business practices to ensure full compliance. 25 Table of Contents On November 3, 2020, California passed the California Privacy Rights Act (“CPRA”) through a ballot initiative.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur principal competitors for our current commercial products and leading clinical development candidates include large, global companies that are more diversified than we are and that have substantial financial, manufacturing, sales and marketing, distribution and other resources: • For PYLARIFY, our competitors currently include approved imaging agents from Telix Pharmaceuticals Limited and Novartis AG, and may in the future include an F 18 PSMA PET imaging agent that Bracco has in late stage clinical development, which we believe could be approved by the FDA for commercialization later in 2023.
Biggest changeOur principal competitors for our current commercial products and leading clinical development candidates include large, global companies that are more diversified than we are and that have substantial financial, manufacturing, sales and marketing, distribution and other resources: • For PYLARIFY, our competitors currently include approved imaging agents from Telix Pharmaceuticals Limited, Novartis AG, and Blue Earth, a subsidiary of Bracco. • For DEFINITY, our competitors currently include GE Healthcare and Bracco. • For a number of our radiopharmaceutical commercial products, our competitors currently include Curium, GE Healthcare, Bracco and Jubilant Life Sciences, an affiliate of JHS and Jubilant Radiopharma, and potentially BWXT Medical. • For PNT2002 and 1095, our principal competitors may include Novartis AG; Telix Pharmaceuticals Limited; and Curium, each of which has commercialized products or product candidates in advanced clinical stage of development. 33 Table of Contents • For PNT2003, our principal competitor may include Novartis AG; ITM Radiopharma; and RayzeBio (under agreement to be acquired by Bristoll Meyers Squibb), each of which has commercialized products or product candidates in advanced clinical stage of development. • For MK-6240, our principal competitors may include Eli Lilly and Company and Life Molecular Imaging, each of which has commercialized products or product candidates in advanced clinical stage of development. . • For LNTH-1363S, our principal competitors may include Sofie Bioscience; GE Healthcare; and Novartis AG, each of which has product candidates in clinical stage of development.
We can give no assurance that we would have grounds to file a patent infringement suit, that we would obtain the full 30 month stay, that we would be successful on the merits asserting that an Applicant infringes our Orange Book-listed patent, or that we would be successful defending the validity of our Orange Book-listed patent in court or in a USPTO adversarial proceeding.
We can give no assurance that we would have grounds to file a patent infringement suit, that we would obtain the full 30 month stay, that we would be successful on the merits asserting that an Applicant infringes our Orange Book-listed patent, or that we would be successful defending the validity of our Orange Book-listed patent in court or in a USPTO adversarial proceeding.
Our just-in-time manufacturing of radiopharmaceutical products relies on the reliability of our equipment and processes and the timely receipt of radioactive raw materials and the timely shipment of finished goods, and any disruption of our supply or distribution networks could have a negative effect on our business.
Our just-in-time manufacturing of radiopharmaceutical products relies on the reliability of our equipment and processes, the timely receipt of radioactive raw materials and the timely shipment of finished goods, and any disruption of our supply or distribution networks could have a negative effect on our business.
Third party payors continually review their coverage policies for existing and new products and procedures and can deny coverage for procedures that include the use of our products or revise payment policies such that payments do not adequately cover the cost of our products.
Third-party payors continually review their coverage policies for existing and new products and procedures and can deny coverage for products or procedures that include the use of our products or revise payment policies such that payments do not adequately cover the cost of our products.
We used approximately $75.0 million of the net proceeds from Notes to repurchase shares of our common stock from purchasers of Notes in privately negotiated transactions effected with or through one of the initial purchasers or its affiliate.
We used approximately $75.0 million of the net proceeds from the Notes to repurchase shares of our common stock from purchasers of Notes in privately negotiated transactions effected with or through one of the initial purchasers or its affiliate.
Challenges with product quality or product performance, including defects, caused by us or our suppliers could result in a decrease in customers and revenues, unexpected expenses and loss of market share. The manufacture of our products is highly exacting and complex and must meet stringent quality requirements, due in part to strict regulatory requirements, including the FDA’s cGMPs.
Challenges with product quality or product performance, including defects, caused by us or our manufacturers or suppliers could result in a decrease in customers and revenues, unexpected expenses and loss of market share. The manufacture of our products is highly exacting and complex and must meet stringent quality requirements, due in part to strict regulatory requirements, including the FDA’s cGMPs.
In addition, a cybersecurity attack could result in other negative consequences, including disruption of our internal operations, increased cybersecurity protection costs, lost revenue, regulatory actions or litigation. Any disruption of internal operations could also have a material adverse impact on our results of operations, financial condition and cash flows. To date, we have not experienced any material cybersecurity attacks.
In addition, a cybersecurity attack could result in other negative consequences, including disruption of our internal operations, increased cybersecurity protection costs, lost revenue, regulatory actions or litigation. Any disruption of internal operations could also have a material adverse impact on our results of operations, financial condition and cash flows. To date, we have not experienced any known material cybersecurity attacks.
If FDA approval of manufacturing sites is delayed or withdrawn or our PMF sites experience manufacturing issues, our future business, results of operations, financial condition and cash flows could be adversely affected. We rely on JHS as a substantial supplier of DEFINITY, as well as our sole source manufacturer of NEUROLITE, CARDIOLITE and evacuation vials.
If FDA approval of manufacturing sites is delayed or withdrawn or our PMF sites experience manufacturing issues, our business, results of operations, financial condition and cash flows could be adversely affected. We rely on JHS as a substantial supplier of DEFINITY, as well as our sole source manufacturer of NEUROLITE, CARDIOLITE and evacuation vials.
In addition, because a number of our radiopharmaceutical products, including PYLARIFY, our TechneLite generators, and AZEDRA, rely on radioisotopes with limited half-lives, we or our partners must manufacture, finish and distribute these products on a just-in-time basis, because the underlying radioisotope is in a constant state of decay.
In addition, because a number of our radiopharmaceutical products, including PYLARIFY and our TechneLite generators rely on radioisotopes with limited half-lives, we or our partners must manufacture, finish and distribute these products on a just-in-time basis, because the underlying radioisotope is in a constant state of decay.
Our commercial success will depend in part on obtaining and maintaining patent and trade secret protection of our commercial products and technologies and agents in development as well as successfully enforcing and defending these patents and trade secrets against third parties and their challenges, both in the U.S. and in foreign countries.
Our commercial success will depend in part on obtaining and maintaining patent and trade secret protection of our commercial products and technologies and products in development as well as successfully enforcing and defending these patents and trade secrets against third parties and their challenges, both in the U.S. and in foreign countries.
As a result, there is a limited amount of Mo-99 available which could limit the quantity of TechneLite that we could manufacture, sell and distribute, resulting in a further substantial negative effect on our business, results of operations, financial condition and cash flows.
As a result, there is a limited amount of Mo-99 available which could limit the quantity of TechneLite that we could manufacture, sell and distribute, resulting in a substantial negative effect on our business, results of operations, financial condition and cash flows.
In addition, our issuance of additional shares of common stock will dilute the ownership interests of our existing common stockholders. Repurchases by us of our common stock may affect the value of our common stock. In December 2022, our Board of Directors authorized the repurchase of up to $150.0 million in aggregate amount of our common stock under certain circumstances.
In addition, our issuance of additional shares of common stock will dilute the ownership interests of our existing common stockholders. Repurchases by us of our common stock may affect the value of our common stock. In December 2022, our Board authorized the repurchase of up to $150.0 million in aggregate amount of our common stock under certain circumstances.
In the U.S. for DEFINITY we have six Orange Book-listed method of use patents, one of which expires in 2035 and five of which expire in 2037, as well as additional manufacturing patents that are not Orange Book-listed expiring in 2023 and 2037.
In the U.S. for DEFINITY we have six Orange Book-listed method-of-use patents, one of which expires in 2035 and five of which expire in 2037, as well as additional manufacturing patents that are not Orange Book-listed expiring in 2037.
These proceedings are complex and extended and occupy the resources of our management and employees. These proceedings are also costly to prosecute and defend and may involve substantial awards or damages payable by us if not found in our favor.
These proceedings are complex and extended and occupy the resources of our management and employees. Legal proceedings are also costly to prosecute and defend and may involve substantial awards or damages payable by us if not found in our favor.
In addition, if other government payors or private payors do not provide adequate reimbursement for the use of PYLARIFY, our future business, results of operations, financial condition and cash flows could be adversely affected.
In addition, if other government payors or private payors do not provide adequate reimbursement for the use of PYLARIFY, our business, results of operations, financial condition and cash flows could be adversely affected.
In the event a 505(b)(2) applicant does not rely on studies related to the innovator product, the 30-month stay would not apply, but additional clinical studies may be required.
In the event a 505(b)(2) applicant does not rely on studies related to the innovator product, the 30-month stay would not apply, but additional clinical trials may be required.
A cybersecurity breach could hurt our reputation by adversely affecting the perception of customers and potential customers of the security of their orders and personal information, as well as the perception of our manufacturing partners of the security of their proprietary information.
A cybersecurity breach could hurt our reputation by adversely affecting the perception of customers and potential customers about the security of their orders and personal information, as well as the perception of our manufacturing partners of the security of their proprietary information.
Any delay or inability to enter into these arrangements could have an adverse impact on our future business, results of operations, financial condition and cash flows.
Any delay or inability to enter into these arrangements could have an adverse impact on our business, results of operations, financial condition and cash flows.
To obtain regulatory approval for these agents in the indications being pursued, we must conduct extensive human tests, which are referred to as clinical trials, as well as meet other rigorous regulatory requirements, as further described in Part I, Item 1. “Business—Regulatory Matters.” Satisfaction of all regulatory requirements typically takes many years and requires the expenditure of substantial resources.
To obtain regulatory approval for these products in the indications being pursued, we must conduct extensive human tests, which are referred to as clinical trials, as well as meet other rigorous regulatory requirements, as further described in Part I, Item 1. “Business—Regulatory Matters.” Satisfaction of all regulatory requirements typically takes many years and requires the expenditure of substantial resources.
To the extent we lose market share to existing or future competitors (including during any period of time in which our TPT Status has expired but TPT Status for a later-approved competitive product still exists), such loss of market share could have an adverse impact on our future business, results of operations, financial condition and cash flows.
To the extent we lose market share to existing or future competitors (including during any period of time in which our TPT Status has expired but TPT Status for a later-approved competitive products still exists), such loss of market share could have an adverse impact on our business, results of operations, financial condition and cash flows.
Levels of market acceptance for our new products could be affected by a number of factors, including: • The availability of alternative products from our competitors; • The breadth of indications in which alternative products from our competitors can be marketed; • The price of our products relative to those of our competitors; • The timing of our market entry; • Our ability to enter into commercial contracts to sell our products; • Our ability to market and distribute our products effectively; • Market acceptance of our products; and • Our ability to obtain adequate coding, coverage and payment.
Levels of market acceptance for our new products could be affected by a number of factors, including: • The availability of alternative products from our competitors; • The breadth of indications in which alternative products from our competitors can be marketed; • The price of our products relative to those of our competitors; • The timing of our market entry; • Our ability to enter into commercial contracts to sell our products; • Our ability to market and distribute our products effectively; • Market acceptance of our products; and • Our ability to obtain adequate coding, coverage and payment, including the availability of TPT Status.
If a product is approved, the FDA may limit the indications for which the product may be marketed, require extensive warnings on the product labeling, impose restricted distribution programs, require expedited reporting of certain adverse events, or require costly ongoing requirements for post-marketing clinical studies and surveillance or other risk management measures to monitor the safety or efficacy of the product.
If a product is approved, the FDA may limit the indications for which the product may be marketed, require extensive warnings on the product labeling, impose restricted distribution programs, require expedited reporting of certain adverse events, or require costly ongoing requirements for post-marketing clinical trials and surveillance or other risk management measures to monitor the safety or efficacy of the product.
If we or our subsidiaries incur additional debt, the risks that we and they now face as a result of our leverage could intensify. In addition, the 2022 Revolving Facility will not prevent us from incurring obligations that do not constitute indebtedness under the agreements. Our 2022 Revolving Facility contains restrictions that will limit our flexibility in operating our business.
If we or our subsidiaries incur additional debt, the risks that we and they now face as a result of our leverage could intensify. In addition, the 2022 Revolving Facility will not prevent us from incurring obligations that do not constitute indebtedness under that agreement. Our 2022 Revolving Facility contains restrictions that will limit our flexibility in operating our business.
Accordingly, our business is subject to risks associated with doing business internationally, including: • Less stable political and economic environment and changes in a specific country’s or region’s political or economic conditions; • Changes in trade policies, regulatory requirements and other barriers, including, for example, U.S. trade sanctions against Iran and those countries and entities doing business with Iran, which could adversely impact international isotope production and, indirectly, our global supply chain; • Potential global disruptions in air transport due to COVID-19, which could adversely affect our international supply chains for radioisotopes and DEFINITY RT as well as international distribution channels for our commercial products; 46 Table of Contents • Entering into, renewing or enforcing commercial agreements with international governments or provincial authorities or entities directly or indirectly owned or controlled by such governments or authorities, such as our Belgian, Australian and South African isotope suppliers, IRE, ANSTO and NTP, and our Chinese development and commercialization partner, Double-Crane; • International customers which are agencies or institutions owned or controlled by foreign governments; • Local business practices which may be in conflict with the U.S.
Accordingly, our business is subject to risks associated with doing business internationally, including: • Less stable political and economic environment and changes in a specific country’s or region’s political or economic conditions; 43 Table of Contents • Changes in trade policies, regulatory requirements and other barriers, including, for example, U.S. trade sanctions against Iran and those countries and entities doing business with Iran, which could adversely impact international isotope production and, indirectly, our global supply chain; • Potential global disruptions in air transport, which could adversely affect our international supply chains for radioisotopes and DEFINITY RT as well as international distribution channels for our commercial products; • Entering into, renewing or enforcing commercial agreements with international governments or provincial authorities or entities directly or indirectly owned or controlled by such governments or authorities, such as our Belgian, Australian and South African isotope suppliers, IRE, ANSTO and NTP, and our Chinese development and commercialization partner, Double-Crane; • International customers which are agencies or institutions owned or controlled by foreign governments; • Local business practices which may be in conflict with the U.S.
Possible consequences of those actions could include: • Substantial modifications to our business practices and operations; • Significantly reduced demand for our products (if products become ineligible for reimbursement under federal and state healthcare programs); • A total or partial shutdown of production in one or more of the facilities where our products are produced while the alleged violation is being remediated; 39 Table of Contents • Delays in or the inability to obtain future pre-market clearances or approvals; and • Withdrawals or suspensions of our current products from the market.
Possible consequences of those actions could include: • Substantial modifications to our business practices and operations; • Significantly reduced demand for our products (if products become ineligible for reimbursement under federal and state healthcare programs); • A total or partial shutdown of production in one or more of the facilities where our products are produced while the alleged violation is being remediated; • Delays in or the inability to obtain future pre-market clearances or approvals; and • Withdrawals or suspensions of our current products from the market.
For example, the manufacturing, marketing and distribution of a radiopharmaceutical like flurpiridaz will require the creation of a field-based network of specialized PET manufacturing facilities, or PMFs, with radioisotope-producing cyclotrons, similar to what we created for PYLARIFY, and will need to be manufactured and distributed rapidly to end-users.
For example, the manufacturing, marketing and distribution of a radiopharmaceutical like flurpiridaz and MK-6240 will require the creation of a field-based network of specialized PET manufacturing facilities, or PMFs, with radioisotope-producing cyclotrons, similar to what we created for PYLARIFY, and will need to be manufactured and distributed rapidly to end-users.
Subsequently, the Medicare Access and CHIP Reauthorization Act of 2015 significantly revised the methodology for updating the Medicare physician fee schedule. And more recently, Congress enacted legislation in 2017 that effectively eliminated the Healthcare Reform Act’s “individual mandate” beginning in 2019. Congress continues to consider other healthcare reform legislation.
Subsequently, the Medicare Access and CHIP Reauthorization Act of 2015 significantly revised the methodology for updating the Medicare physician fee schedule. In 2017, Congress enacted legislation that effectively eliminated the Healthcare Reform Act’s “individual mandate” beginning in 2019. Congress continues to consider other healthcare reform legislation.
Additionally, we must comply with requirements concerning advertising and promotion for our products, including the prohibition on the promotion of our products for indications that have not been approved by the FDA or a so-called “off-label use” or promotion that is inconsistent with the approved labeling.
Additionally, we must comply with requirements concerning advertising and promotion for our products, including the prohibition on the promotion of our products for indications for which they have not been approved by the FDA or a so-called “off-label use” or promotion that is inconsistent with the approved labeling.
For example: • We might not have been the first to make the inventions covered by each of our pending patent applications and issued patents, and we could lose our patent rights as a result; • We might not have been the first to file patent applications for these inventions or our patent applications may not have been timely filed, and we could lose our patent rights as a result; • Others may independently develop similar or alternative technologies or duplicate any of our technologies; • It is possible that none of our pending patent applications will result in any further issued patents; • Our issued patents may not provide a basis for commercially viable drugs, may not provide us with any protection from unauthorized use of our intellectual property by third parties, and may not provide us with any competitive advantages; • The validity or enforceability of our patent applications or patents may be subject to challenge through interferences, oppositions, post-grant review, ex-parte re-examinations, inter partes review or similar administrative proceedings; • While we generally apply for patents in those countries where we intend to make, have made, use or sell patented products, we may not be able to accurately predict all of the countries where patent protection will ultimately be desirable and may be precluded from doing so at a later date; • We may choose not to seek patent protection in certain countries where the actual cost outweighs the perceived benefit at a certain time; 44 Table of Contents • Patents issued in foreign jurisdictions may have different scopes of coverage than our U.S. patents and so our products may not receive the same degree of protection in foreign countries as they would in the U.S.; • We may not develop additional proprietary technologies that are patentable; or • The patents of others may have an adverse effect on our business.
For example: • We might not have been the first to make the inventions covered by each of our pending patent applications and issued patents, and we could lose our patent rights as a result; • We might not have been the first to file patent applications for these inventions or our patent applications may not have been timely filed, and we could lose our patent rights as a result; • Others may independently develop similar or alternative technologies or duplicate any of our technologies; • It is possible that none of our pending patent applications will result in any further issued patents; • Our issued patents may not provide a basis for commercially viable drugs, may not provide us with any protection from unauthorized use of our intellectual property by third parties, and may not provide us with any competitive advantages; 41 Table of Contents • The validity or enforceability of our patent applications or patents may be subject to challenge through interferences, oppositions, post-grant review, ex-parte re-examinations, inter partes review or similar administrative proceedings; • While we generally apply for patents in those countries where we intend to make, have made, use or sell patented products, we may not be able to accurately predict all of the countries where patent protection will ultimately be desirable and may be precluded from doing so at a later date; • We may choose not to seek patent protection in certain countries where the actual cost outweighs the perceived benefit at a certain time; • Patents issued in foreign jurisdictions may have different scopes of coverage than our U.S. patents and so our products may not receive the same degree of protection in foreign countries as they would in the U.S.; • We may not develop additional proprietary technologies that are patentable; • The patents of others may have an adverse effect on our business; or • The cost to defend our patents may be significant and may result in litigation which could be costly and time consuming.
The success of new product development depends on many factors, including our ability to fund development of new agents or new indications for existing agents, anticipate and satisfy customer needs, obtain timely regulatory approval based on performance of our agents in development versus their clinical study comparators, develop and manufacture products in a cost-effective and timely manner, maintain advantageous positions with respect to intellectual property and differentiate our products from our competitors.
The success of new product development depends on many factors, including our ability to fund development of new products or new indications for existing products, anticipate and satisfy customer needs, obtain timely regulatory approval based on performance of our products in development versus their clinical trial comparators, develop and manufacture products in a cost-effective and timely manner, maintain advantageous positions with respect to intellectual property and differentiate our products from our competitors.
Although PYLARIFY is broadly available across the U.S., we continue to seek qualification for additional PMFs in 2023 and can give no assurance that the FDA will continue to approve PMFs in accordance with our planned roll-out schedule.
Although PYLARIFY is broadly available across the U.S., we continue to seek qualification for additional PMFs in 2024 and can give no assurance that the FDA will continue to approve PMFs in accordance with our planned roll-out schedule.
These covenants limit our and our restricted subsidiaries’ ability to, among other things: • Maintain net leverage above certain specified levels; • Maintain interest coverage below certain specified levels; • Incur additional debt; • Pay dividends or make other distributions; • Redeem stock; • Issue stock of subsidiaries; • Make certain investments; • Create liens; • Enter into transactions with affiliates; and • Merge, consolidate or transfer all or substantially all of our assets.
These covenants limit our and our restricted subsidiaries’ ability to, among other things: • Maintain net leverage above certain specified levels; 50 Table of Contents • Maintain interest coverage below certain specified levels; • Incur additional debt; • Pay dividends or make other distributions; • Redeem stock; • Issue stock of subsidiaries; • Make certain investments; • Create liens; • Enter into transactions with affiliates; and • Merge, consolidate or transfer all or substantially all of our assets.
Changes to the Medicare hospital outpatient prospective payment system payment rates, including reductions implemented for certain hospital outpatient sites, could influence the decisions by hospital outpatient physicians to perform procedures that involve our products. 37 Table of Contents We also believe that all these changes and their resulting pressures may incrementally reduce the overall number of diagnostic medical imaging procedures performed.
Changes to the Medicare hospital outpatient prospective payment system payment rates, including reductions implemented for certain hospital outpatient sites, could influence the decisions by hospital outpatient physicians to perform procedures that involve our products. We also believe that all of these changes and their resulting pressures may incrementally reduce the overall number of diagnostic medical imaging procedures performed.
A number of other factors may cause significant delays in the completion of our clinical trials, including unexpected delays in the initiation of clinical sites, slower than projected enrollment, competition with ongoing clinical trials and scheduling conflicts with participating clinicians, regulatory requirements, limits on manufacturing capacity and failure of an agent to meet required standards for administration to humans.
A number of other factors may cause significant delays in the completion of our clinical trials, including unexpected delays in the initiation of clinical sites, slower than projected enrollment, competition with ongoing clinical trials and scheduling conflicts with participating clinicians, regulatory requirements, limits on manufacturing capacity and failure of an investigational product to meet required standards for administration to humans.
We may be subject to litigation over infringement claims regarding the products we manufacture or distribute.
We may be subject to litigation over infringement claims regarding the products we manufacture or distribute or intend to manufacture or distribute.
In addition, in the U.S., it has become increasingly common for patent infringement actions to prompt claims that antitrust laws have been violated during the prosecution of the patent or during litigation involving the defense of that patent. Such claims by direct 48 Table of Contents and indirect purchasers and other payors are typically filed as class actions.
In addition, in the U.S., it has become increasingly common for patent infringement actions to prompt claims that antitrust laws have been violated during the prosecution of the patent or during litigation involving the defense of that patent. Such claims by direct and indirect purchasers and other payors are typically filed as class actions.
While we note that FDA-approved labels for F 18 based and PSMA-11 based PSMA PET imaging agents have generally been treated as a class of drugs, including by the National Comprehensive Cancer Center in its guidelines and the Society for Nuclear Medicine and Molecular Imaging in its appropriate use criteria, we can give no assurances that the Novartis prostate cancer trials using PYLARIFY will be successful, that the PLUVICTO prescribing information will be expanded to incorporate F 18 based PSMA PET imaging agents like PYLARIFY, or how clinical practice may evolve.
While we note that FDA-approved labels for F 18-based and PSMA-11 based PSMA PET imaging agents have generally been treated as a class of drugs, including by the National Comprehensive Cancer Center in its guidelines and the Society for Nuclear Medicine and Molecular Imaging in its appropriate use criteria, we can give no assurances that PLUVICTO prescribing information will be expanded to incorporate F 18-based PSMA PET imaging agents like PYLARIFY, or how clinical practice may evolve.
New hardware, software or agents in a given diagnostic modality may be developed that provide benefits superior to the then-dominant hardware, software and agents in that modality, resulting in commercial displacement of the agents.
New hardware, software or products in a given diagnostic modality may be developed that provide benefits superior to the then-dominant hardware, software and products in that modality, resulting in commercial displacement of the products.
The growth of our business is also dependent on our ability to continue to grow the appropriate use of DEFINITY in suboptimal echocardiograms. DEFINITY currently competes with ultrasound enhancing agents produced by GE Healthcare and Bracco Diagnostics, Inc. (“Bracco”), as well as echocardiography without ultrasound enhancing agents and other non-echocardiography agents.
The growth of our business is also dependent on our ability to continue to grow the appropriate use of DEFINITY in suboptimal echocardiograms. DEFINITY currently competes with ultrasound enhancing agents produced by GE Healthcare and Bracco, as well as echocardiography without ultrasound enhancing agents and other non-echocardiography agents.
In addition, the provisions of the Bribery Act extend beyond bribery of foreign public officials and are more onerous than the FCPA in a number of other respects, including jurisdiction, non-exemption of facilitation payments and penalties. Our policies mandate compliance with these anti-bribery laws.
In addition, the provisions of the Bribery Act extend beyond bribery of foreign public officials and are more onerous than the FCPA in a number of other respects, including jurisdiction, non-exemption of facilitation payments and penalties. 44 Table of Contents Our policies mandate compliance with these anti-bribery laws.
Violations of these laws, or allegations of those violations, could disrupt our business and result in a material adverse effect on our results of operations, financial condition and cash flows. 47 Table of Contents Our business depends on the continued effectiveness and availability of our information technology infrastructure, and failures of this infrastructure could harm our operations.
Violations of these laws, or allegations of those violations, could disrupt our business and result in a material adverse effect on our results of operations, financial condition and cash flows. Our business depends on the continued effectiveness and availability of our information technology infrastructure, and failures of this infrastructure could harm our operations.
The purchase price per share of the common stock repurchased in such transactions was equal to the closing sale price per share of our common stock on December 5, 2022, which was $56.01 per share. Following this initial repurchase, we may from time to time repurchase additional shares of our common stock.
The purchase price per share of the common stock repurchased in such transactions was equal to the closing sale price per share of our 49 Table of Contents common stock on December 5, 2022, which was $56.01 per share. Following this initial repurchase, we may from time to time repurchase additional shares of our common stock.
Due to the stringent regulations and requirements of the governing regulatory authorities regarding the manufacture of our products, we may not be able to quickly restart manufacturing at our facilities or establish additional or replacement sources for certain products, components or materials.
Due to the stringent regulations and requirements of the 32 Table of Contents governing regulatory authorities regarding the manufacture of our products, we may not be able to quickly restart manufacturing at our facilities or establish additional or replacement sources for certain products, components or materials.
Violation of any of these regulatory schemes, individually or collectively, could disrupt our business and have a material adverse effect on our business, results of operations, financial condition and cash flows. Under U.S. law, for example, we are required to report certain adverse events and production problems, if any, to the FDA.
Violation of any of these regulatory schemes, individually or collectively, could disrupt our business and have a material adverse effect on our business, results of operations, financial condition and cash flows. Under U.S. law, for example, we are required to report certain adverse events and production problems, if any, to the FDA or other federal or state regulators.
Determination of the rebate amount that we pay to state Medicaid programs for our products, of prices charged to government and certain private payors for our products, or of amounts paid for our products under government healthcare programs, depends upon information reported by us to the government.
Determination of 37 Table of Contents the rebate amount that we pay to state Medicaid programs for our products, of prices charged to government and certain private payors for our products, or of amounts paid for our products under government healthcare programs, depends upon information reported by us to the government.
Defending against or settling such claims and any unfavorable legal decisions, settlements or orders could have a material adverse effect on our business, financial condition and results of operations and could cause the market value of our common stock to decline.
Defending against or settling legal proceedings and any unfavorable legal decisions, settlements or orders could have a material adverse effect on our business, financial condition and results of operations and could cause the market value of our common stock to decline.
In addition to the products described above, for reasons of quality assurance or cost-effectiveness, we purchase certain components and raw materials from sole suppliers (including, for example, the specially designed chemistry synthesis boxes and consumables used in the manufacturing of PYLARIFY, the lipid blend material and perflutren gas used in the manufacturing of DEFINITY and the lead casing for our TechneLite generators).
In addition, for reasons of quality assurance or cost-effectiveness, we purchase certain components and raw materials from sole suppliers (including, for example, the specially designed chemistry synthesis boxes and consumables used in the manufacturing of PYLARIFY, the lipid blend material and perflutren gas used in the manufacturing of DEFINITY and the lead casing for our TechneLite generators).
For example, in addition to our collaboration with Curium on piflufolastat F 18 in Europe, GE Healthcare on flurpiridaz and POINT on PNT2002 and PNT2003, we have other collaborations to develop and commercialize products. In addition, certain clinical trials for our product candidates may be conducted by government-sponsored agencies, and consequently will be dependent on governmental participation and funding.
For example, in addition to our collaboration with Curium on PYLCLARI in Europe, GE Healthcare on flurpiridaz and POINT on PNT2002 and PNT2003, we have other collaborations to develop and commercialize products. In addition, certain clinical trials for our product candidates may be conducted by government-sponsored agencies, and consequently will be dependent on governmental participation and funding.
Our inability to retain our existing executive leadership and senior management team, maintain an appropriate internal succession program or attract and retain additional qualified personnel could have a material adverse effect on our business. 41 Table of Contents Our business depends on our ability to successfully introduce new products and adapt to a changing technology and medical practice landscape.
Our inability to retain our existing executive leadership and senior management team, maintain an appropriate internal succession program or attract and retain additional qualified personnel could have a material adverse effect on our business. Our business depends on our ability to successfully introduce new products and adapt to a changing technology and medical practice landscape.
Both before and after the approval of our products and agents in development, we, our products, development agents, operations, facilities, suppliers, distributors, contract manufacturers, contract research organizations and contract testing laboratories are subject to extensive and, in certain circumstances, expanding regulation by federal, state and local government agencies in the U.S. as well as non-U.S. and transnational laws and regulations, with regulations differing from country to country, including, among other things, anti-trust and competition laws and regulations, and the General Data Protection Regulation in the European Union.
Both before and after the approval of our products in development, we, our products, development products, operations, facilities, suppliers, distributors, contract manufacturers, contract research organizations and contract testing laboratories are subject to extensive and, in certain circumstances, expanding regulation by federal, state and local government agencies in the U.S. as well as non-U.S. and transnational laws and regulations, with regulations differing from country to country and even state to state, including, among other things, anti-trust and competition laws and regulations, and data privacy laws and regulations such as the General Data Protection Regulation in the European Union and the CCPA and the CPRA.
If government regulations are interpreted or enforced in a manner adverse to us or our business, we may be subject to enforcement actions, penalties, exclusion and other material limitations on our operations.
Our business and industry are subject to complex and costly regulations. If government regulations are interpreted or enforced in a manner adverse to us or our business, we may be subject to enforcement actions, penalties, exclusion and other material limitations on our operations.
Further, the radiopharmaceutical industry continues to evolve strategically, with several market participants either recently sold or for sale. In addition, the supply-demand dynamics of the industry are complex because of large market positions of some participants, legacy businesses, government subsidies (in particular, relating to the manufacture of radioisotopes), and group purchasing arrangements.
Further, the radiopharmaceutical industry continues to evolve strategically, with several market participants recently sold. In addition, the supply-demand dynamics of the industry are complex because of large market positions of some participants, legacy businesses, government subsidies (in particular, relating to the manufacture of radioisotopes), and group purchasing arrangements.
The Notes were issued under an indenture, dated as of December 8, 2022 (the 51 Table of Contents “Indenture”), among Holdings, LMI, and U.S. Bank Trust Company, National Association (“U.S. Bank”), as Trustee.
The Notes were issued under an indenture, dated as of December 8, 2022 (the “Indenture”), among Holdings, LMI, and U.S. Bank Trust Company, National Association (“U.S. Bank”), as Trustee.
If in the future issues arise at a third party manufacturer, the FDA could take regulatory action which could limit or suspend the ability of that third party to manufacture our products or have any additional products approved at the relevant facility for manufacture until the issues are resolved and remediated.
If in the future issues arise at our own manufacturing facility or at a third-party manufacturer, the FDA could take regulatory action which could limit or suspend the ability to manufacture our products or have any additional products approved at the relevant facility for manufacture until the issues are resolved and remediated.
After TPT Status expires, under current Medicare rules, PYLARIFY, similar to other diagnostic radiopharmaceuticals, would not be separately reimbursed in the hospital outpatient setting but rather would be bundled into the facility payment a hospital receives for a PET/CT imaging procedure, and the facility payment may not always adequately cover the total cost of the procedure.
After TPT Status expires, under current Medicare rules, PYLARIFY would not be separately reimbursed in the hospital outpatient setting but rather would be bundled into the facility payment a hospital receives for a PET/CT imaging procedure, and the facility payment may not always adequately cover the total cost of the procedure.
After TPT Status expires, under current Medicare rules, PYLARIFY, similar to other diagnostic radiopharmaceuticals, would not be separately reimbursed in the hospital outpatient setting but rather would be bundled into the facility payment a hospital receives for a PET/CT imaging procedure, and the facility payment may not always cover the total cost of the procedure.
After TPT Status expires, under current Medicare rules, PYLARIFY would not be separately reimbursed in the hospital outpatient setting but rather would be bundled into the facility payment a hospital receives for a PET/CT imaging procedure, and the facility payment may not always cover the total cost of the procedure.
We cannot anticipate the actions of our current or future competitors in the same or competing diagnostic modalities, such as significant price reductions on products that are comparable to our own, development of new products that are more cost-effective or have superior performance than our current products or the introduction of generic versions after our proprietary products lose their patent protection.
We cannot anticipate the actions of our current or future competitors in the same or competing modalities, such as significant price reductions on products that are competitive with our own, development of new products that are more cost-effective or have superior performance than our current products or potential future products or the introduction of generic versions after our proprietary products lose their patent protection.
Although we were successful in hiring and onboarding those employees and we have not had any material difficulty in the past in hiring or retaining qualified personnel, if we are unable to retain our existing personnel, or attract and train additional qualified personnel, either because of competition in our industry for these personnel, prolonged remote working conditions due to the COVID-19 pandemic, or insufficient financial resources, then our growth may be limited and it could have a material adverse effect on our business.
Although we were successful in hiring and onboarding those employees and we have not had any material difficulty in the past in hiring or retaining qualified personnel, if we are unable to retain our existing personnel, or attract and train additional qualified personnel, either because of competition in our industry for these personnel or insufficient financial resources, then our growth may be limited and it could have a material adverse effect on our business.
We use hazardous materials in our business and must comply with environmental laws and regulations, which can be expensive. Our operations use hazardous materials and produce hazardous wastes, including radioactive, chemical and, in certain circumstances, biological materials and wastes.
We use hazardous materials in our business and must comply with environmental laws and regulations, which can be expensive. 40 Table of Contents Our operations use hazardous materials and produce hazardous wastes, including radioactive, chemical and, in certain circumstances, biological materials and wastes.
In addition to our existing manufacturing relationships, we are also pursuing new manufacturing relationships to establish and secure additional or alternative suppliers for our commercial products. We also constructed a specialized in-house manufacturing facility at our North Billerica, Massachusetts campus for purposes of producing DEFINITY and, potentially, other sterile vial products.
In addition to our existing manufacturing relationships, we are also pursuing new manufacturing relationships to establish and secure additional or alternative suppliers for our commercial products. We also constructed a specialized in-house manufacturing facility at our North Billerica, Massachusetts campus for purposes of producing the formulation of DEFINITY that requires refrigerated storage and, potentially, other sterile vial products.
As of December 31, 2022, we had approximately $575.0 million of total principal indebtedness remaining under the Notes and availability of $350.0 million under our five-year revolving credit facility (the “2022 Revolving Facility”).
As of December 31, 2023, we had approximately $575.0 million of total principal indebtedness remaining under the Notes and availability of $350.0 million under our five-year 2022 Revolving Facility.
In addition, we are required to make substantial cash payments, achieve milestones and satisfy other conditions, including filing for and obtaining marketing approvals and introducing products, to maintain rights under our license agreements.
In addition, we are required to make substantial cash payments, achieve milestones and satisfy other conditions, including filing for and obtaining marketing approvals and introducing products, sometimes in accordance with established timelines, to maintain rights under our license agreements.
Our business is subject to international economic, political and other risks that could negatively affect our results of operations or financial position. For the year ended December 31, 2022, we derived approximately 3.6% of our revenues and sourced approximately 17.5% of our costs of goods sold outside of the fifty United States.
Our business is subject to international economic, political and other risks that could negatively affect our results of operations or financial position. For the year ended December 31, 2023, we derived approximately 2.6% of our revenues and sourced approximately 11.2% of our costs of goods sold outside of the United States.
In the U.S., we have historically relied on a limited number of radiopharmacy customers, primarily Cardinal, RLS, UPPI, PharmaLogic and Jubilant Radiopharma, to purchase our nuclear imaging products in our Precision Diagnostic product category.
Outside of the U.S., we rely primarily on distributors to generate a substantial portion of our revenue. In the U.S., we have historically relied on a limited number of radiopharmacy customers, primarily Cardinal, RLS, UPPI, PharmaLogic and Jubilant Radiopharma, to purchase our nuclear imaging products in our Precision Diagnostic product category.
Many of our products or product candidates incorporate rights licensed by third parties -- for example, we license patent rights on PYLARIFY from JHU and on PNT2002 and PNT2003 from POINT. We could lose the rights to develop or commercialize these products and product candidates if the related license agreement is terminated due to a breach by us or otherwise.
Many of our products or product candidates incorporate rights licensed by third parties -- for example, we license patent rights on PYLARIFY, PNT2002, PNT2003, MK-6240, LNTH-1363S and NM-01. We could lose the rights to develop or commercialize these products and product candidates if the related license agreement is terminated due to a breach by us or otherwise.
In Canada, we maintain our own direct sales force to generate sales of DEFINITY. Outside of the U.S. and Canada, we have no sales force and, consequently, rely on third party distributors, either on a country-by-country basis or on a multi-country, regional basis, to market, sell and distribute our products.
Outside of the U.S., we have no sales force and, consequently, rely on third party distributors, either on a country-by-country basis or on a multi-country, regional basis, to market, sell and distribute our products.
The commercial launch of PYLARIFY was complex. To manufacture PYLARIFY, we assembled and qualified a nationwide network of PMFs with radioisotope-producing cyclotrons that make F 18, which has a 110-minute half-life, so PYLARIFY is 28 Table of Contents manufactured and distributed rapidly to end-users.
To manufacture PYLARIFY, we assembled and qualified a nationwide network of PMFs with radioisotope-producing cyclotrons that make F 18, which has a 110-minute half-life, so PYLARIFY is manufactured and distributed rapidly to end-users.
Mary Anne Heino, our Chief Executive Officer and President, and other members of our executive leadership and senior management team play a significant role in formulating and executing on our long-term strategy, generating business and overseeing operations. We have an employment agreement with Ms.
Mary Anne Heino, our Chief Executive Officer, and other members of our executive leadership and senior management team play a significant role in formulating and executing on our long-term strategy, generating business and overseeing operations. We have employment agreements with Ms. Heino, Brian Markison, who will succeed Ms.
However, we can give no assurance that our microbubble franchise strategy will be successful or that the modified formulation, new applications or new manufacturing capabilities will grow our microbubble franchise. 30 Table of Contents If we are not able to continue to (i) grow DEFINITY and DEFINITY RT sales, which depend on one or more of the growth of echocardiograms, the growth in the appropriate use of ultrasound enhancing agents in suboptimal echocardiograms, and our ability to sustain and grow our leading position in the U.S. echocardiography ultrasound enhancing agent market, or (ii) be successful with our microbubble franchise strategy, we may not be able to continue to grow the revenue and cash flow of our business, which could have a negative effect on our business, results of operations and financial condition.
If we are not able to continue to (i) grow DEFINITY and DEFINITY RT sales, which depend on one or more of the growth of echocardiograms, the growth in the appropriate use of ultrasound enhancing agents in suboptimal echocardiograms, and our ability to sustain and grow our leading position in the U.S. echocardiography ultrasound enhancing agent market, or (ii) be successful with our microbubble franchise strategy, we may not be able to continue to grow the revenue and cash flow of our business, which could have a negative effect on our business, results of operations and financial condition.
Future acquisitions or in-licenses, however, may entail numerous operational and financial risks, including: • A reduction of our current financial resources; • Incurrence of substantial debt or dilutive issuances of securities to pay for acquisitions; • Difficulty or inability to secure financing to fund development activities for those acquired or in-licensed technologies; • Higher than expected acquisition and integration costs; • Disruption of our business, customer base and diversion of our management’s time and attention to develop acquired products or technologies; and • Exposure to unknown liabilities. 42 Table of Contents We may not have sufficient resources to identify and execute the acquisition or in-licensing of third party products, businesses and technologies and integrate them into our current infrastructure.
Future acquisitions or in-licenses, however, may entail numerous operational and financial risks, including: • A reduction of our current financial resources; 39 Table of Contents • Incurrence of substantial debt or dilutive issuances of securities to pay for acquisitions; • Difficulty or inability to secure financing to fund development activities for those acquired or in-licensed technologies; • Higher than expected acquisition and integration costs; • Disruption of our business, customer base and diversion of our management’s time and attention to develop acquired products or technologies; and • Exposure to unknown liabilities.
We plan to continue our advocacy efforts with CMS and private insurers so that PYLARIFY customers will have appropriate and adequate reimbursement following the expiration of pass-through status and we are also supporting trade associations in their efforts to have Congress pass the Facilitating Innovative Nuclear Diagnostics (FIND) Act, which would allow for separate payment for certain diagnostic radiopharmaceuticals, including PYLARIFY, similar to the way Medicare OPPS currently pays for other drugs, biologics, and therapeutic radiopharmaceuticals instead of under the current TPT structure of a separate payment that is limited to three years, however, we can give no assurances that we will be successful in those efforts.
We plan to continue our advocacy efforts with CMS and private insurers so that PYLARIFY customers will have appropriate and adequate reimbursement following the expiration of TPT Status and we are also supporting trade associations in their efforts to have Congress pass the Facilitating Innovative Nuclear Diagnostics (FIND) Act, which would allow for separate payment for certain diagnostic radiopharmaceuticals, including PYLARIFY, similar to the way Medicare OPPS currently pays for other drugs, biologics, and therapeutic radiopharmaceuticals instead of under the current TPT structure of a separate payment that is limited to three years, however, we can give no assurances that we will be successful in those efforts or that the availability of TPT Status for other diagnostic radiopharmaceuticals will not impact clinical decision making regarding which product to use, which could have an adverse effect on our business, results of operations, financial condition and cash flows.
Notwithstanding these findings, we cannot assure that any of the data generated in either our or GE Healthcare’s sponsored Phase 3 study will be sufficient to support an NDA approval, that GE Healthcare will only have to conduct the one additional Phase 3 clinical study prior to filing an NDA, or that flurpiridaz will 50 Table of Contents ever be approved as a PET MPI imaging agent by the FDA.
Notwithstanding these findings, we cannot assure that any of the data generated in either our or GE Healthcare’s sponsored Phase 3 study will be sufficient to support an NDA approval or that flurpiridaz will ever be approved as a PET MPI imaging agent by the FDA.
Heino and a limited number of other individuals on our executive leadership team, although we cannot prevent them from terminating their employment with us. We do not maintain key person life insurance policies on any of our executive officers.
Heino as Chief Executive Officer effective March 1, 2024, and a limited number of other individuals on our executive leadership 38 Table of Contents team, although we cannot prevent them from terminating their employment with us. We do not maintain key person life insurance policies on any of our executive officers.
The trading price of our common stock is likely to be volatile and subject to wide price fluctuations in response to various factors, including: • Market conditions in the broader stock market; • Actual or anticipated fluctuations in our quarterly financial and operating results; • Issuance of new or changed securities analysts’ reports or recommendations; • Investor perceptions of us and the pharmaceutical and medical device industries; • Sales, or anticipated sales, of large blocks of our stock; • Acquisitions or introductions of new products or services by us or our competitors; • Positive or negative results from our clinical development programs; • Additions or departures of key personnel; • Regulatory or political developments; • Loss of intellectual property protections; • Litigation and governmental investigations; • Geopolitical events; and • Changing economic conditions.
The trading price of our common stock is likely to be volatile and subject to wide price fluctuations in response to various factors, including: • Market conditions in the broader stock market; • Actual or anticipated fluctuations in our quarterly financial and operating results; • Issuance of new or changed securities analysts’ reports or recommendations; • Investor perceptions of us and the pharmaceutical and medical device industries; • Sales, or anticipated sales, of large blocks of our stock; • Acquisitions or introductions of new products or services by us or our competitors; • Positive or negative results from our clinical development programs; • Additions or departures of key personnel; • Regulatory or political developments; • Loss of intellectual property protections; • Litigation and governmental investigations; • Geopolitical events; and • Changing economic conditions. 51 Table of Contents These and other factors may cause the market price and demand for our common stock to fluctuate substantially, which may limit or prevent investors from readily selling their shares of common stock and may otherwise negatively affect the liquidity of our common stock.
For example, we believe the approval of PLUVICTO for the treatment of adult patients with PSMA-positive mCRPC who have already been treated with other anticancer treatments (androgen receptor pathway inhibition and taxane-based chemotherapy) created a new addressable market for the use of PSMA PET imaging in patient selection for PSMA-targeted therapy that increases the total addressable market in the U.S. by an additional 30,000 new scans per year for patients with mCRPC.
For example, we believe the approval of PLUVICTO for the treatment of adult patients with PSMA-positive mCRPC who have already been treated with other anticancer treatments (androgen receptor pathway inhibition and taxane-based chemotherapy) created a new addressable market for the use of PSMA PET imaging in patient selection for PSMA-targeted therapy.
To the extent that these types of changes have the effect of reducing the aggregate number of diagnostic medical imaging procedures performed in the U.S., our business, results of operations, financial condition and cash flows would be adversely affected.
While it is unclear when CMS will resume implementation of the AUC program, to the extent that these types of changes have the effect of reducing the aggregate number of diagnostic medical imaging procedures performed in the U.S., our business, results of operations, financial condition and cash flows would be adversely affected.
There is no assurance that the Healthcare Reform Act, as currently enacted or as amended in the future, will not adversely affect our business and financial results, and we cannot predict how future federal or state legislative, judicial or administrative changes relating to healthcare reform will affect our business.
There is no assurance that the Healthcare Reform Act, as currently enacted or as amended in the future, will not adversely affect our business and financial results, and we cannot predict how future federal or state legislative, judicial or administrative changes relating to healthcare reform will affect our business. 36 Table of Contents In addition, other legislative changes have been proposed and adopted since the Healthcare Reform Act was enacted.
The successful growth of PYLARIFY is also dependent on our ability to maintain PYLARIFY as the leading PSMA PET imaging agent in a competitive environment in which other PSMA PET imaging agents have been approved and additional ones are in development.
The successful growth of PYLARIFY is also dependent on our ability to clinically and commercially differentiate PYLARIFY from other products on the market and to maintain PYLARIFY as the leading PSMA PET imaging agent in a competitive environment in which other PSMA PET imaging agents have been approved.
At the facility on our North Billerica, Massachusetts campus, we manufacture TechneLite on a highly automated production line. At the facility on our Somerset, New Jersey site, we manufacture AZEDRA on a hot cell line. As with all manufacturing facilities, equipment and infrastructure age and become subject to increasing maintenance and repair.
At the facility on our North Billerica, Massachusetts campus, we manufacture TechneLite on an automated production line. As with all manufacturing facilities, equipment and infrastructure age and become subject to increasing maintenance and repair.
We must offer discounted pricing or rebates on purchases of pharmaceutical products under various federal and state healthcare programs, such as the Medicaid drug rebate program, the “federal ceiling price” drug pricing program, the 340B drug pricing program and the Medicare Part D Program.
We must offer discounted pricing or rebates on purchases of pharmaceutical products under various federal and state healthcare programs, such as the Medicaid drug rebate program, the 340B drug pricing program and the Medicare Part D Program. We must also report specific prices to government agencies under healthcare programs, such as the Medicaid drug rebate program and Medicare Part B.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changePlease refer to Note 17, “Leases” for further details. We believe all of these facilities are well-maintained and suitable for the office, manufacturing or warehouse operations conducted in them and provide adequate capacity for current and foreseeable future needs.
Biggest changeWe believe all of these facilities are well-maintained and suitable for the office, manufacturing or warehouse operations conducted in them and provide adequate capacity for current and foreseeable future needs.
Item 2. Properties The following table summarizes information regarding our significant leased and owned properties, as of December 31, 2022: Location Purpose Square Footage Ownership Lease Term End U.S.
Item 2. Properties The following table summarizes information regarding our significant leased and owned properties, as of December 31, 2023: Location Purpose Square Footage Ownership Lease Term End U.S.
North Billerica, Massachusetts Manufacturing, Laboratory, Mixed Use and Other Office Space 431,000 Owned N/A Bedford, Massachusetts Executive Offices, Office Space 46,500 Leased June 2031 New York, New York Office Space 26,000 Leased* September 2030 Somerset, New Jersey Manufacturing, Mixed Use and Office Space 11,400 Leased November 2028 Somerset, New Jersey Office Space 8,249 Leased March 2027 Canada Quebec Mixed Use and Office Space 1,106 Leased May 2023 Quebec Distribution Center and Office Space 1,433 Leased May 2023 Sweden Lund Office Space 4,000 Leased December 2024 * On October 11, 2021, we entered into an agreement to sublease our office space at the World Trade Center in New York City to an unrelated third party.
North Billerica, Massachusetts Manufacturing, Laboratory, Mixed Use and Other Office Space 431,000 Owned N/A Bedford, Massachusetts Executive Offices, Laboratory, Office Space 88,200 Leased December 2039 New York, New York Office Space 26,000 Leased* September 2030 Somerset, New Jersey Manufacturing, Mixed Use and Office Space 11,400 Leased November 2028 Somerset, New Jersey Office Space 8,249 Leased March 2027 Canada Quebec Mixed Use and Office Space 1,106 Leased May 2024 Quebec Distribution Center and Office Space 1,433 Leased May 2025 Sweden Lund Office Space 4,000 Leased December 2024 * On October 11, 2021, we entered into an agreement to sublease our office space at the World Trade Center in New York City to an unrelated third party.
Added
Please refer to Note 16, “Leases” for further details. ** On January 9, 2024, we announced that Perspective agreed to acquire the assets and associated lease of our radiopharmaceutical manufacturing facility in Somerset, New Jersey, subject to customary closing conditions, including regulatory approval.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings Information with respect to certain legal proceedings is included in Note 20, “Commitments and Contingencies”, to the consolidated financial statements contained in Item 8. Financial Statements and Supplementary Data, and is incorporated herein by reference. Item 4. Mine Safety Disclosures Not applicable 55 Table of Contents PART II
Biggest changeItem 3. Legal Proceedings Information with respect to certain legal proceedings is included in Note 19, “Commitments and Contingencies”, to the consolidated financial statements contained in Item 8. Financial Statements and Supplementary Data, and is incorporated herein by reference. Item 4. Mine Safety Disclosures Not applicable 54 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePeriod Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program October 2022 ** 2,519 $ 71.53 * * November 2022 ** 3,373 $ 59.05 * * December 2022 *** 1,343,056 $ 56.00 1,339,046 * Total 1,348,948 1,339,046 ________________________________ * These amounts are not applicable as we did not have a share repurchase program in effect. ** Reflects shares withheld to satisfy minimum statutory tax withholding amounts due from employees related to the receipt of stock which resulted from the exercise for vesting of equity awards. *** Includes 4,010 shares withheld to satisfy minimum statutory tax withholding amounts due from employees related to the receipt of stock which resulted from the exercise for vesting of equity awards.
Biggest changePeriod Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program October 2023 * 4,984 $ 71.02 0 $75.0 million November 2023 * 3,930 $ 68.38 0 $75.0 million December 2023 * 4,061 $ 76.04 0 $75.0 million Total 12,975 0 $75.0 million ________________________________ * Reflects shares withheld to satisfy minimum statutory tax withholding amounts due from employees related to the receipt of stock which resulted from the exercise for vesting of equity awards.
Securities Authorized for Issuance under Equity Compensations Plans The information required with respect to this item is incorporated herein by reference to our Definitive Proxy Statement for our 2023 Annual Meeting of Stockholders to be filed with the SEC no later than 120 days after the close of our year ended December 31, 2022. 57 Table of Contents Item 6. [Reserved] 58 Table of Contents
Securities Authorized for Issuance under Equity Compensations Plans The information required with respect to this item is incorporated herein by reference to our Definitive Proxy Statement for our 2024 Annual Meeting of Stockholders to be filed with the SEC no later than 120 days after the close of our year ended December 31, 2023. 56 Table of Contents Item 6. [Reserved] 57 Table of Contents
Our historic share price performance is not necessarily indicative of future share price performance. ________________________________ * Assumes hypothetical investment of $100 in our common stock and each of the indices on December 31, 2017, including reinvestment of dividends. 56 Table of Contents Performance Graph Data The following table sets forth the cumulative total shareholder return on the hypothetical $100 investment in our common stock and each of the comparative indices on December 31, 2017: Date Lantheus Holdings, Inc.
Our historic share price performance is not necessarily indicative of future share price performance. ________________________________ * Assumes hypothetical investment of $100 in our common stock and each of the indices on December 31, 2018, including reinvestment of dividends. 55 Table of Contents Performance Graph Data The following table sets forth the cumulative total shareholder return on the hypothetical $100 investment in our common stock and each of the comparative indices on December 31, 2018: Date Lantheus Holdings, Inc.
The graph assumes a hypothetical $100 investment in our common stock and in each of the comparative indices on December 31, 2017.
The graph assumes a hypothetical $100 investment in our common stock and in each of the comparative indices on December 31, 2018.
The following graph provides a comparison of the cumulative total shareholder return on our common shares with that of the cumulative total shareholder return on the (i) Russell 2000 Index, (ii) the NASDAQ US Small Cap Index and (iii) the NASDAQ US Mid Cap Index, commencing on December 31, 2017 and ending December 31, 2022.
The following graph provides a comparison of the cumulative total shareholder return on our common shares with that of the cumulative total shareholder return on the (i) Russell 2000 Index, (ii) the NASDAQ US Small Cap Index and (iii) the NASDAQ US Mid Cap Index, commencing on December 31, 2018 and ending December 31, 2023.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock trades on the NASDAQ Global Market under the symbol “LNTH”. Holders of Record On February 16, 2023, there were approximately 31 stockholders of record of our common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock trades on the NASDAQ Global Market under the symbol “LNTH”. Holders of Record On February 15, 2024, there were approximately 30 stockholders of record of our common stock.
Issuer Purchases of Equity Securities The following table presents information with respect to purchases of common stock we made during the three months ended December 31, 2022. In December 2022, our Board of Directors authorized the repurchase of up to $150.0 million in aggregate amount of our common stock under certain circumstances.
In December 2022, our Board authorized the repurchase of up to $150.0 million in aggregate amount of our common stock under certain circumstances.
(“LNTH”) Russell 2000 Index (“^RUT”) NASDAQ US Small Cap Index (“^NQUSS”) NASDAQ US Mid Cap Index (“^NQUSM”) 12/31/17 $ 100.00 $ 100.00 $ 100.00 $ 100.00 12/31/18 $ 76.53 $ 87.82 $ 88.01 $ 88.59 12/31/19 $ 100.29 $ 108.66 $ 107.70 $ 112.26 12/31/20 $ 65.97 $ 128.61 $ 130.82 $ 128.79 12/31/21 $ 141.27 $ 146.23 $ 151.89 $ 152.08 12/31/22 $ 249.19 $ 114.70 $ 118.32 $ 124.00 Dividend Policy We did not declare or pay any dividends in 2022, and we do not currently intend to pay dividends in the foreseeable future.
(“LNTH”) Russell 2000 Index (“^RUT”) NASDAQ US Small Cap Index (“^NQUSS”) NASDAQ US Mid Cap Index (“^NQUSM”) 12/31/18 $ 100.00 $ 100.00 $ 100.00 $ 100.00 12/31/19 $ 131.05 $ 123.72 $ 122.37 $ 126.72 12/31/20 $ 86.20 $ 146.44 $ 148.64 $ 145.38 12/31/21 $ 184.60 $ 166.50 $ 172.58 $ 171.68 12/31/22 $ 325.62 $ 130.60 $ 134.43 $ 139.97 12/31/23 $ 396.17 $ 150.31 $ 155.82 $ 163.12 Dividend Policy We did not declare or pay any dividends in 2023, and we do not currently intend to pay dividends in the foreseeable future.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—External Sources of Liquidity” for further information.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—External Sources of Liquidity” for further information. Recent Sales of Unregistered Securities None. Issuer Purchases of Equity Securities The following table presents information with respect to purchases of common stock we made during the three months ended December 31, 2023.
Removed
Recent Sales of Unregistered Securities On December 8, 2023, pursuant to a Purchase Agreement among us, LMI, as Guarantor, and BofA Securities, Inc. and SVB Securities LLC, as representatives of the several initial purchasers therein, we issued $575.0 million in aggregate principal amount of Notes due 2027.
Removed
The Notes and the shares of our common stock into which the Notes are convertible will not be registered under the Securities Act, in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act.

Item 7. Management's Discussion & Analysis

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

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Biggest changeThe amount of debt that may be retired, if any, could be material and would be decided at the sole discretion of our Board of Directors and will depend on market conditions, our cash position and other considerations. 69 Table of Contents Funding Requirements Our future capital requirements will depend on many factors, including: • The amount and timing of the calculated cash payment related to the CVRs; • The level of product sales and the pricing environment of our currently marketed products, particularly PYLARIFY and DEFINITY, as well as any additional products that we may market in the future; • Revenue mix shifts and associated volume and selling price changes that could result from contractual status changes with key customers and additional competition; • The continued costs of the ongoing commercialization of PYLARIFY and PYLARIFY AI; • The costs of acquiring or in-licensing, developing, obtaining regulatory approval for, and commercializing, new products, businesses or technologies, including any potential related milestone or royalty payments, together with the costs of pursuing opportunities that are not eventually consummated; • Our investment in the further clinical development and commercialization of products and development candidates, including PNT2002, PNT2003, 1095 and NM-01; • The costs of investing in our facilities, equipment and technology infrastructure; • The costs and timing of establishing or amending manufacturing and supply arrangements for commercial supplies of our products and raw materials and components; • Our ability to have products manufactured and released from manufacturing sites in a timely manner in the future, or to manufacture products at our in-house manufacturing facilities in amounts sufficient to meet our supply needs; • The costs of further commercialization of our existing products, particularly in international markets, including product marketing, sales and distribution and whether we obtain local partners to help share such commercialization costs; • The extent to which we choose to establish collaboration, co-promotion, distribution or other similar arrangements for our marketed products; • The legal costs relating to maintaining, expanding and enforcing our intellectual property portfolio, pursuing insurance or other claims and defending against product liability, regulatory compliance, intellectual property or other claims; • The cost of interest on any additional borrowings which we may incur under our financing arrangements; and • The impact of sustained inflation on our costs of goods sold and operating expenses.
Biggest changeFunding Requirements Our future capital requirements will depend on many factors, including: • The level of product sales and the pricing environment of our currently marketed products, particularly PYLARIFY and DEFINITY, as well as any additional products that we may market in the future; • Revenue mix shifts and associated volume and selling price changes that could result from contractual status changes with key customers and additional competition; • The continued costs of the ongoing commercialization of our products; • Our investment in the further clinical development and commercialization of products and development candidates, including PNT2002, PNT2003, 1095 and MK-6240; • The costs of acquiring or in-licensing, developing, obtaining regulatory approval for, and commercializing, new products, businesses or technologies, including any potential related milestone or royalty payments, together with the costs of pursuing opportunities that are not eventually consummated; • The costs of investing in our facilities, equipment and technology infrastructure; • The costs and timing of establishing or amending manufacturing and supply arrangements for commercial supplies of our products and raw materials and components; • Our ability to have products manufactured and released from manufacturing sites in a timely manner in the future, or to manufacture products at our in-house manufacturing facilities in amounts sufficient to meet our supply needs; • The costs of further commercialization of our existing products, particularly in international markets, including product marketing, sales and distribution and whether we obtain local partners to help share such commercialization costs; • The legal costs relating to maintaining, expanding and enforcing our intellectual property portfolio, pursuing insurance or other claims and defending against product liability, regulatory compliance, intellectual property or other claims, including the patent infringement claim related to the filing of our ANDA for PNT2003; • The cost of interest on any additional borrowings which we may incur under our financing arrangements; and • The impact of sustained inflation on our costs of goods sold and operating expenses.
We believe that our diagnostic products provide improved diagnostic information that enables HCPs to better detect and characterize, or rule out, disease, with the potential to achieve better patient outcomes, reduce patient risk and limit overall costs throughout the healthcare system.
We believe that our diagnostic products provide improved information that enables HCPs to better detect and characterize, or rule out, disease, with the potential to achieve better patient outcomes, reduce patient risk and limit overall costs throughout the healthcare system.
With respect to PNT2003, POINT is responsible for curating all data, analysis and other information necessary for regulatory approval, and supporting us in the preparation of regulatory filings for PNT2003, and we are responsible for preparing for and seeking regulatory approval of all such applications, as well as performing and funding all future development and commercialization of PNT2003 following such approval.
PNT2003 With respect to PNT2003, POINT is responsible for curating all data, analysis and other information necessary for regulatory approval, and supporting us in the preparation of regulatory filings. We are responsible for preparing for and seeking regulatory approval of all such applications, as well as performing and funding all future development and commercialization following such approval.
Generally, our costs in connection with the strategic partnerships relate to the supply of drug and other ancillary expenses and the benefits can include possible supply, milestone and royalty payments, additional intellectual property rights and strategic relationships.
Generally, our costs in connection with the strategic partnerships relate to intellectual property, the supply of drug and other ancillary expenses and the benefits can include possible supply, milestone and royalty payments, additional intellectual property rights and strategic relationships.
The Notes were issued under an indenture, dated as of December 8, 2022 (the “Indenture”), among the Company, LMI, as Guarantor, and U.S. Bank, as Trustee. The net proceeds from the issuance of the Notes were approximately $557.8 million, after deducting the initial purchasers’ discounts and offering expenses payable by us.
The Notes were issued under an indenture, dated as of December 8, 2022 (the “Indenture”), among the Company, LMI, as Guarantor, and U.S. Bank, as Trustee. The net proceeds from the issuance of the Notes were approximately $557.8 million, after deducting the initial purchasers’ discounts and offering expenses payable by us.
Global Mo-99 Supply We currently have Mo-99 supply agreements with Institute for Radioelements (“IRE”), running through December 31, 2023, with auto-renewal provisions that are terminable upon notice of non-renewal, and with NTP Radioisotopes (“NTP”), acting for itself and on behalf of its subcontractor, the Australian Nuclear Science and Technology Organisation (“ANSTO”), running through December 31, 2024.
Global Mo-99 Supply We currently have Mo-99 supply agreements with Institute for Radioelements (“IRE”), running through December 31, 2024, with auto-renewal provisions that are terminable upon notice of non-renewal, and with NTP Radioisotopes (“NTP”), acting for itself and on behalf of its subcontractor, the Australian Nuclear Science and Technology Organisation (“ANSTO”), running through December 31, 2024.
Net Cash Provided by (Used in) Financing Activities Net cash provided by financing activities during the year ended December 31, 2022 is primarily attributable to the proceeds of $557.8 million received from the issuance of the Notes, proceeds of $7.5 million from stock option exercises and proceeds of $5.6 million from the voluntarily terminated interest rate swap contracts in connection with the refinancing of debt.
Net cash provided by financing activities during the year ended December 31, 2022 is primarily attributable to the proceeds of $557.8 million received from the issuance of the Notes, proceeds of $7.5 million from stock option exercises and proceeds of $5.6 million from the voluntarily terminated interest rate swap contracts in connection with the refinancing of debt.
We have the right to request an increase to the 2022 Revolver Facility or request the establishment of one or more new incremental term loan facilities, in an aggregate principal amount of up to $335 million or consolidated EBITDA for the four consecutive fiscal quarters most recently ended, plus additional amounts, in certain circumstances.
We have the right to request an increase to the 2022 Revolver Facility or request the establishment of one or more new incremental term loan facilities, in an aggregate principal amount of up to $335.0 million or consolidated EBITDA for the four consecutive fiscal quarters most recently ended, plus additional amounts, in certain circumstances.
As of December 31, 2022, we were in compliance with all financial and other covenants under the 2022 Credit Agreement. On December 8, 2022, we issued $575.0 million in aggregate principal amount of the Notes, which includes $75.0 million in aggregate principal amount of Notes sold pursuant to the full exercise of the initial purchasers’ option to purchase additional Notes.
As of December 31, 2023, we were in compliance with all financial and other covenants under the 2022 Credit Agreement. On December 8, 2022, we issued $575.0 million in aggregate principal amount of the Notes, which includes $75.0 million in aggregate principal amount of Notes sold pursuant to the full exercise of the initial purchasers’ option to purchase additional Notes.
The additional milestone payments are based on FDA approval and net sales and commercial milestones. Under the terms of the PNT2002 License Agreement, we have the potential to pay up to an additional $281 million in milestone payments and up to $1.3 billion in sales milestone payments upon the achievement of specified annual sales thresholds.
The additional milestone payments are based on FDA approval and net sales and commercial milestones. Under the terms of the PNT2002 License Agreement, we have the potential to pay up to an additional $281.0 million in milestone payments and up to $1.3 billion in sales milestone payments upon the achievement of specified annual sales thresholds.
With respect to PNT2002, POINT is generally responsible for funding and development activities required for FDA approval of PNT2002, including generating all clinical and nonclinical data, analysis and other information, and we are responsible for preparing for and seeking regulatory approval for PNT2002, as well as performing and funding all future development and commercialization of PNT2002 following such approval.
PNT2002 With respect to PNT2002, POINT is generally responsible for funding and development activities required for FDA approval, including generating all clinical and nonclinical data, analysis and other information, and we are responsible for preparing for and seeking regulatory approval for PNT2002, as well as performing and funding all future development and commercialization following such approval.
If any of these transactions require an amendment or waiver under the covenants in our 2022 Credit Agreement, which could result in additional expenses associated with obtaining the amendment or waiver, we will seek to obtain such a waiver to remain in compliance with those covenants.
If any of these transactions require an amendment or waiver under the covenants in our 2022 Credit Agreement, which could result in additional expenses associated with obtaining the amendment or waiver, we will seek to obtain such an amendment or waiver to remain in compliance with those covenants.
“Risk Factors” and “Cautionary Note Regarding Forward Looking Statements.” included in this Annual Report on Form 10-K. This section discusses 2022 and 2021 items and year-to-year comparisons between 2022 and 2021. Discussions of 2020 items and year-to-year comparisons between 2021 and 2020 have been excluded from this Form 10-K and can be found in “Part II, Item 7.
“Risk Factors” and “Cautionary Note Regarding Forward Looking Statements.” included in this Annual Report on Form 10-K. This section discusses 2023 and 2022 items and year-to-year comparisons between 2023 and 2022. Discussions of 2021 items and year-to-year comparisons between 2022 and 2021 have been excluded from this Form 10-K and can be found in “Part II, Item 7.
Our material cash requirements include the following contractual and other obligations. Debt We completed a sale of $575.0 million in aggregate principal amount of the Notes due in 2027. As of December 31, 2022, we had no amounts of principal due within the next twelve months.
Our material cash requirements include the following contractual and other obligations. Debt We completed a sale of $575.0 million in aggregate principal amount of the Notes due in 2027. As of December 31, 2023, we had no amounts of principal due within the next twelve months.
The Letters of Credit, Swingline Loans and the borrowings under the 2022 Revolving Facility are expected to be used for working capital and other general corporate purposes. Please refer to Note 13, “Long-Term Debt, Net, and Other Borrowings” for further details on the 2022 Facility.
The Letters of Credit, Swingline Loans and the borrowings under the 2022 Revolving Facility are expected to be used for working capital and other general corporate purposes. Please refer to Note 12, “Long-Term Debt, Net, and Other Borrowings” for further details on the 2022 Facility.
(“Cerevast”), in which our microbubbles will be used in connection with Cerevast’s ocular ultrasound device to improve blood flow in occluded retinal veins in the eye; (ii) CarThera SAS, for the use of our microbubbles in combination with SonoCloud, a proprietary implantable device in development for the treatment of recurrent glioblastoma; (iii) Insightec Ltd.
(“Cerevast”), in which our microbubbles will be used in connection with Cerevast’s ocular ultrasound device to improve blood flow in occluded retinal veins in the eye; (ii) CarThera SAS, for the use of our microbubbles in 64 Table of Contents combination with SonoCloud, a proprietary implantable device in development for the treatment of recurrent glioblastoma; (iii) Insightec Ltd.
We classify IPR&D intangible assets acquired in a business combination as an indefinite-lived intangible asset 73 Table of Contents until the completion or abandonment of the associated research and development efforts. Upon completion of the associated research and development efforts, we will determine the useful life and begin amortizing the assets to reflect their use over their remaining lives.
We classify IPR&D intangible assets acquired in a business combination as an indefinite-lived intangible asset until the completion or abandonment of the associated research and development efforts. Upon completion of the associated research and development efforts, we will determine the useful life and begin amortizing the assets to reflect their use over their remaining lives.
Although we have a globally diverse Mo-99 supply with IRE in Belgium, NTP in South Africa, and ANSTO in Australia, we still face supplier and logistical challenges in our Mo-99 supply chain. When one supplier experiences outages, we generally rely on Mo-99 supply from the other suppliers to limit the impact of the outages.
Although we believe we have the most globally diverse Mo-99 supply with IRE in Belgium, NTP in South Africa, and ANSTO in Australia, we still face supplier and logistical challenges in our Mo-99 supply chain. When one supplier experiences outages, we generally rely on Mo-99 supply from the other suppliers to limit the impact of the outages.
Issuance of Convertible Notes On December 8, 2022, we issued $575.0 million in aggregate principal amount of 2.625% Convertible Senior Notes due 2027 (the “Notes”), which includes $75.0 million in aggregate principal amount of the Notes sold pursuant to the full exercise of the initial purchasers’ option to purchase additional Notes.
Issuance of Convertible Notes 60 Table of Contents On December 8, 2022, we issued $575.0 million in aggregate principal amount of 2.625% Convertible Senior Notes due 2027 (the “Notes”), which includes $75.0 million in aggregate principal amount of the Notes sold pursuant to the full exercise of the initial purchasers’ option to purchase additional Notes.
PNT2002 Under the terms of the PNT2002 License Agreement, Lantheus Two, LLC (“Lantheus Two”) paid POINT an upfront cash payment of $250.0 million, and could pay up to an additional $281.0 million in milestone payments upon the achievement of specified U.S. and ex-U.S. regulatory milestones related to PNT2002.
PNT2002 Under the terms of the PNT2002 License Agreement, Lantheus Two paid POINT an upfront cash payment of $250.0 million, and could pay up to an additional $281.0 million in milestone payments upon the achievement of specified U.S. and ex-U.S. regulatory milestones related to PNT2002.
For immuno-oncology, we intend to offer NM-01, a novel technetium-99m SPECT imaging agent that we are developing to assess PD-L1 expression in cancer cells, for potential use as an efficacy and safety biomarker in immuno-oncology therapies. With respect to pan-oncology, we are further exploring the use of NTI-1309 as an innovative imaging biomarker that targets fibroblast activation protein.
For immuno-oncology, we intend to offer NM-01, a novel technetium-99m SPECT imaging agent that we are developing to assess PD-L1 expression in cancer cells, for potential use as an efficacy and safety biomarker in immuno-oncology therapies. With respect to pan-oncology, we are further exploring the use of LNTH-1363S as an innovative imaging biomarker that targets fibroblast activation protein.
For example, with respect to prostate cancer, we collaborate with pharmaceutical companies by supplying them with piflufolastat F 18 for use in their therapeutic drug development programs.
For example, in prostate cancer, we collaborate with pharmaceutical companies by supplying them with piflufolastat F 18 for use in their therapeutic drug development programs.
Other costs included in general and administrative expenses are professional fees for information technology services, external legal fees, consulting and accounting services as well as bad debt expense, certain facility and insurance costs, including director and officer liability insurance. General and administrative expenses decreased $16.8 million for the year ended December 31, 2022 compared to the prior year period.
Other costs included in general and administrative expenses are professional fees for information technology services, external legal fees, consulting and accounting services as well as bad debt expense, certain facility and insurance costs, including director and officer liability insurance. General and administrative expenses decreased $8.1 million for the year ended December 31, 2023 compared to the prior year period.
In particular, we are focused on late-stage diagnostic and therapeutic product opportunities in oncology and other strategic areas that will complement our existing portfolio. Oncology As we continue to pursue expanding our strategic partnerships, our Pharma Services activities in oncology are designed to enable precision medicine using biomarkers and digital solutions that augment diagnostic productivity.
In particular, we are focused on therapeutic and diagnostic radiopharmaceutical product opportunities in oncology and other strategic areas that will complement our existing portfolio. Oncology As we continue to pursue expanding our strategic partnerships, our Pharma Solutions activities in oncology are designed to enable precision medicine using biomarkers and digital solutions that augment diagnostic productivity.
However, we cannot be assured that such an amendment or waiver would be granted, or that additional capital will be available on acceptable terms, if at all. At December 31, 2022, our only current committed external source of funds is our borrowing availability under our 2022 Revolving Facility.
However, we cannot provide assurance that such an amendment or waiver would be granted, or that additional capital will be available on acceptable terms, if at all. At December 31, 2023, our only current committed external source of funds is our borrowing availability under our 2022 Revolving Facility.
During 2022, the Company released a significant portion of its indemnified liability due to the settlement of these positions in various states at a cost significantly less than our accrual resulting in $9.6 million (net of federal or state benefit) income tax benefit. Refer to Note 5, Income Taxes.
During 2022, the Company released a significant portion of its indemnified liability due to the settlement of these positions in various states at a cost significantly less than our accrual resulting in $9.6 million (net of federal or state benefit) income tax benefit.
We have provided this financial assurance in the form of a $30.3 million surety bond (the “Surety Bond”). As of December 31, 2022, the liability, which was approximately $22.5 million, was measured at the present value of the obligation expected to be incurred of approximately $25.1 million.
We have provided this financial assurance in the form of a $30.3 million surety bond (the “Surety Bond”). As of December 31, 2023, the liability, which was approximately $22.9 million, was measured at the present value of the obligation expected to be incurred of approximately $25.1 million.
Net Cash Provided by Operating Activities Net cash provided by operating activities of $281.8 million during the year ended December 31, 2022 was primarily comprised of net income adjusted for charges incurred in connection with acquired in-process research and development (“IPR&D”) and the net effect of non-cash items such as depreciation, amortization and accretion expense, the change in fair value of contingent assets and liabilities of $34.7 million (refer to Note 4, “Fair Value of Financial Instruments”, for further details on contingent consideration liabilities, including CVRs), and stock-based compensation expense.
Net cash provided by operating activities of $281.8 million during the year ended December 31, 2022 was primarily comprised of net income adjusted for charges incurred in connection with acquired IPR&D and the net effect of non-cash items such as depreciation, amortization and accretion expense, the change in fair value of contingent assets and liabilities of $34.7 million (refer to Note 4, “Fair Value of Financial Instruments”, for further details on contingent consideration liabilities, including CVRs), and stock-based compensation expense.
(“Insightec”), which will 63 Table of Contents use our microbubbles in connection with the development of Insightec’s transcranial guided focused ultrasound device for the treatment of glioblastoma as well as other neurodegenerative conditions; and (iv) Allegheny Health Network (“AHN”), which will use our microbubbles in combination with AHN’s ultrasound-assisted non-viral gene transfer technology for the development of a proposed treatment of xerostomia. flurpiridaz In September 2022, we announced with our strategic partner GE Healthcare Limited (“GE Healthcare”) that the recent Phase III clinical trial of our investigational radiotracer, flurpiridaz, had met its co-primary endpoints of exceeding a 60% threshold for both sensitivity and specificity for detecting coronary artery disease (“CAD”).
(“Insightec”), which will use our microbubbles in connection with the development of Insightec’s transcranial guided focused ultrasound device for the treatment of glioblastoma as well as other neurodegenerative conditions; (iv) Allegheny Health Network (“AHN”), which will use our microbubbles in combination with AHN’s ultrasound-assisted non-viral gene transfer technology for the development of a proposed treatment of xerostomia; and (v) SonoThera, which will use our microbubbles in combination with their ultrasound-guided, non-viral, gene therapy platform and treatments. flurpiridaz In September 2022, we announced with our strategic partner GE Healthcare Limited (“GE Healthcare”) that the recent Phase 3 clinical trial of our investigational radiotracer, flurpiridaz, had met its co-primary endpoints of exceeding a 60% threshold for both sensitivity and specificity for detecting coronary artery disease (“CAD”).
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the SEC on February 24, 2022.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our annual report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on February 23, 2023.
We may be required to pay additional amounts up to approximately $200.0 million in contingent payments under our license agreements. Asset Acquisition During 2022, we entered into the POINT License Agreements, in which we made upfront payments of $260.0 million, and under which we may make additional milestone payments.
We may be required to pay additional amounts up to approximately $264.4 million in contingent payments under our license agreements. Asset Acquisitions During 2022, we entered into the POINT License Agreements, in which we made upfront payments of $260.0 million, and under which we may make additional milestone payments.
Additionally, we will pay double-digit royalty payments for research revenue and commercial sales. Research revenue is derived from existing partnerships with pharmaceutical companies that use the imaging agent in clinical trials and includes milestone and dose-related payments.
Additionally, we will pay double-digit royalty payments for research revenue and commercial sales. Research revenue is derived from existing partnerships with pharmaceutical companies that use MK-6240 in clinical trials and includes milestone and dose-related payments.
We had $415.7 million of cash and cash equivalents at December 31, 2022. Our 2022 Revolving Facility contains a number of affirmative, negative, reporting and financial covenants, in each case subject to certain exceptions and materiality thresholds.
We had $713.7 million of cash and cash equivalents as of December 31, 2023. Our 2022 Revolving Facility contains a number of affirmative, negative, reporting and financial covenants, in each case subject to certain exceptions and materiality thresholds.
We produce and market our products throughout the United States (the “U.S.”), selling primarily to hospitals, independent diagnostic testing facilities, government facilities, integrated delivery networks, radiopharmacies, clinics, and group practices. We sell our products outside the U.S. through a combination of direct distribution in Canada and third party distribution relationships in Europe, Canada, Australia, Asia-Pacific, Central America and South America.
We produce and market our products throughout the United States (the “U.S.”), selling primarily to hospitals, independent diagnostic testing facilities, and radiopharmacies. We sell our products outside the U.S. through a combination of direct distribution in Canada and third party distribution relationships in Europe, Canada, Australia, Asia-Pacific, Central America and South America.
As of December 31, 2022, we had fixed finance lease payment obligations of $0.6 million, with $0.4 million payable within twelve months. Purchase Obligations We have purchase obligations that primarily consist of noncancelable obligations related to minimum quantities of goods or services that have been committed to be purchased on an annual basis.
As of December 31, 2023, we had fixed finance lease payment obligations of $1.7 million, with $0.8 million payable within twelve months. Purchase Obligations We have purchase obligations that primarily consist of noncancelable obligations related to minimum quantities of goods or services that have been committed to be purchased on an annual basis.
These reductions were offset by increased employee-related costs and professional fees. Research and Development Research and development expenses relate primarily to the development of new products to add to our portfolio and costs related to our medical affairs, medical information and regulatory functions.
These reductions were partially offset by increased employee-related costs, investments in technology, new lease expense, and increased professional fees. Research and Development Research and development expenses relate primarily to the development of new products to add to our portfolio and costs related to our medical affairs, medical information and regulatory functions.
Net Cash (Used in) Provided by Investing Activities Net cash used in investing activities during the year ended December 31, 2022 was primarily due to the $260.0 million upfront payment to POINT and the $18.3 million of capital expenditures partially offset by $1.8 million received from the sale of our Puerto Rico subsidiary. 68 Table of Contents Net cash provided by investing activities during the year ended December 31, 2021 was primarily due to cash proceeds of $15.8 million received from the sale of our Puerto Rico subsidiary, which was offset by $12.1 million of capital expenditures.
Net cash used in investing activities during the year ended December 31, 2022 was primarily due to the $260.0 million upfront payment to POINT and the $18.3 million of capital expenditures partially offset by $1.8 million received from the sale of our Puerto Rico subsidiary.
The terms of the 2022 Revolving Facility are set forth in the Credit Agreement, dated as of December 2, 2022, by and among us, the lenders from time to time party thereto and Citizens Bank, N.A., as administrative agent and collateral agent (the “2022 Credit Agreement”).
In addition, we replaced our $200.0 million revolving facility with the 2022 Revolving Facility. The terms of the 2022 Revolving Facility are set forth in the Credit Agreement, dated as of December 2, 2022, by and among us, the lenders from time to time party thereto and Citizens Bank, N.A., as administrative agent and collateral agent (the “2022 Credit Agreement”).
Loss on Extinguishment of Debt During the year ended December 31, 2022, we realized a $0.6 million loss on extinguishment of debt related to the refinancing of our existed indebtedness.
Loss on Extinguishment of Debt During the year ended December 31, 2022, we realized a $0.6 million loss on extinguishment of debt related to the refinancing of our existed indebtedness. There were no extinguishments on debt for the year ended December 31, 2023.
Liquidity and Capital Resources Cash Flows The following table provides information regarding our cash flows: Year Ended December 31, (in thousands) 2022 2021 2020 Net cash provided by operating activities $ 281,781 $ 53,916 $ 16,396 Net cash (used in) provided by investing activities $ (276,547) $ 3,683 $ (4,912) Net cash provided by (used in) financing activities $ 311,691 $ (39,332) $ (21,861) For a discussion of our liquidity and capital resources related to our cash flow activities for the fiscal year ended December 31, 2020, see “Part II, Item 7.
Liquidity and Capital Resources Cash Flows The following table provides information regarding our cash flows: Year Ended December 31, (in thousands) 2023 2022 2021 Net cash provided by operating activities $ 305,260 $ 281,781 $ 53,916 Net cash provided by (used in) investing activities $ 5,939 $ (276,547) $ 3,683 Net cash (used in) provided by financing activities $ (13,062) $ 311,691 $ (39,332) For a discussion of our liquidity and capital resources related to our cash flow activities for the fiscal year ended December 31, 2021, see “Part II, Item 7.
We sell our products primarily to hospitals, independent diagnostic testing facilities, government facilities, integrated delivery networks, radiopharmacies, clinics, and group practices, and we consider customer purchase orders, which in some cases are governed by master sales or group purchasing organization agreements, to be contracts with our customers.
We sell our products primarily to hospitals, independent diagnostic testing facilities, and radiopharmacies, and we consider customer purchase orders, which in some cases are governed by master sales or group purchasing organization agreements, to be contracts with 74 Table of Contents our customers.
Our Strategic Partnerships focus on enabling precision medicine through the use of biomarkers, digital solutions and pharma services platforms, and also includes our license of RELISTOR to Bausch Health Companies, Inc. (“Bausch”). Our commercial products are used by oncologists, urologists, nuclear medicine physicians, cardiologists, sonographers, technologists, radiologists, and internal medicine physicians working in a variety of clinical settings.
Our Strategic Partnerships focus on enabling precision medicine through the use of biomarkers, digital solutions and pharma solutions platforms. Our commercial products are used by cardiologists, internal medicine physicians, nuclear medicine physicians, oncologists, radiologists, sonographers, technologists, and urologists working in a variety of clinical settings.
As of December 31, 2022, we had minimum purchase obligations of $16.6 million, with $5.7 million due within twelve months. License Agreements We have entered into license agreements in which fixed payments have been committed to be paid on an annual basis.
As of December 31, 2023, we had minimum purchase obligations of $10.9 million, with $2.7 million due within twelve months. License Agreements We have entered into license agreements in which fixed payments have been committed to be paid on an annual basis. As of December 31, 2023, we had no amount of fixed license payments due within twelve months.
We are vulnerable to future supply shortages, especially for our single sourced products. Disruption in our financial performance could also occur if we experience significant adverse changes in product or customer mix, broad economic downturns, sustained inflation, adverse industry or company conditions or catastrophic external events, including pandemics such as COVID-19, natural disasters and political or military conflict.
Disruption in our financial performance could occur if we experience significant adverse changes in product or customer mix, broad economic downturns, sustained inflation, adverse industry or company conditions or catastrophic external events, including pandemics such as COVID-19, natural disasters and political or military conflict.
In accordance with our accounting policy, the change in the tax liabilities, penalties and interest associated with our uncertain tax positions (net of any offsetting federal or state benefit) is recognized within income tax (benefit) expense.
In accordance with our accounting policy, the change in the tax liabilities, penalties and interest associated with our uncertain tax positions (net of any offsetting federal or state benefit) is recognized within income tax expense (benefit). Our uncertain tax positions include indemnified liabilities, in accordance with the Stock and Asset Purchase Agreement entered into with BMS in 2008.
Income Tax (Benefit) Expense Our effective tax rate for each reporting period is presented as follows: Year Ended December 31, 2022 2021 Effective tax rate (5.0)% 5.0% 67 Table of Contents Our effective tax rate in fiscal 2022 differs from the U.S. statutory rate of 21% primarily due to the income tax benefit for the release of a portion of our uncertain tax positions and the tax benefit associated with stock compensation deductions offset by tax expense from the change in fair value of contingent consideration and expense generated on the revaluation of the Company’s deferred state tax rate.
Our effective tax rate in fiscal 2022 differs from the U.S. statutory rate of 21% primarily due to the income tax benefit for the release of a portion of our uncertain tax positions and the tax benefit associated with stock compensation deductions offset by tax expense from the change in fair value of contingent consideration and expense generated on the revaluation of the Company’s deferred state tax rate.
Based on our current operating plans, we believe our balance of cash and cash equivalents, which totaled $415.7 million as of December 31, 2022, along with cash generated by ongoing operations and continued access to our 2022 Revolving Facility, will be sufficient to satisfy our cash requirements over the next twelve months and beyond.
Accordingly, we may be limited in utilizing the full amount of our 2022 Revolving Facility as a source of liquidity. 72 Table of Contents Based on our current operating plans, we believe our balance of cash and cash equivalents, which totaled $713.7 million as of December 31, 2023, along with cash generated by ongoing operations and continued access to our 2022 Revolving Facility, will be sufficient to satisfy our cash requirements over the next twelve months and beyond.
We have collaborated on the development and will also collaborate on potential commercialization through a joint steering committee. If flurpiridaz receives regulatory approval and is commercially successful, we will receive: • up to $60 million in regulatory and sales milestone payments, • tiered double-digit royalties on U.S. sales., and • mid-single digit royalties on sales outside of the U.S.
If flurpiridaz receives regulatory approval and is commercially successful, we will receive: • up to $60 million in regulatory and sales milestone payments, • tiered double-digit royalties on U.S. sales., and • mid-single digit royalties on sales outside of the U.S.
(“POINT”), in which we were granted a license to exclusive worldwide rights (excluding Japan, South Korea, China (including Hong Kong, Macau and Taiwan), Singapore and Indonesia) to co-develop and commercialize POINT’s PNT2002 and PNT2003 product candidates.
(“POINT”), in which we were granted a license to exclusive worldwide rights (excluding Japan, South Korea, China (including Hong Kong, Macau, and Taiwan), Singapore, and Indonesia) to co-develop and commercialize POINT’s PNT2002 and PNT2003 product candidates. On December 27, 2023, Eli Lilly announced the completion of its acquisition of POINT.
We commercially launched aPROMISE under the name PYLARIFY AI in the U.S. in November 2021. During the second quarter of 2022, we received a new 510(k) clearance for an updated version of our PYLARIFY AI platform. PYLARIFY AI is artificial intelligence medical device software that is designed to assist with the reading and quantification of PYLARIFY scans.
During the second quarter of 2022, we received a new 510(k) clearance for an updated version of our PYLARIFY AI platform. 61 Table of Contents PYLARIFY AI is artificial intelligence medical device software designed to assist with the reading and quantification of PYLARIFY scans.
The primary working capital sources of cash were the increase in accruals associated with PYLARIFY sales. The primary working capital uses of cash were an increase in trade receivables associated primarily with the increase in PYLARIFY revenues.
The primary working capital sources of cash were the increase in accruals associated with PYLARIFY sales.
Future interest payments associated with the Notes total $76.2 million, with $16.3 million payable within twelve months. Leases We have operating lease arrangements for certain facilities, including corporate and manufacturing space. As of December 31, 2022, we had fixed operating lease payment obligations of $33.7 million, with $3.5 million payable within twelve months. We have lease arrangements for certain equipment.
Future interest payments associated with the Notes total $60.0 million, with $15.1 million payable within twelve months. Leases We have operating lease arrangements for certain facilities, including corporate and manufacturing space. As of December 31, 2023, we had fixed operating lease payment obligations of $99.5 million, with $4.6 million payable within twelve months. We have lease arrangements for certain equipment.
In addition, effective January 1, 2022, the Centers for Medicare and Medicaid Services (“CMS”) granted Transitional Pass-Through Payment Status in the hospital outpatient setting (“TPT Status”) for PYLARIFY, enabling traditional Medicare to provide an incremental payment for PET/CT scans performed with PYLARIFY in that setting. TPT Status for PYLARIFY is expected to expire on December 31, 2024.
In addition, effective January 1, 2022, CMS granted TPT Status in the hospital outpatient setting for PYLARIFY, enabling traditional Medicare to provide an incremental payment for PET/CT scans performed with PYLARIFY in that setting. TPT Status for PYLARIFY could expire on December 31, 2024.
Our leading Precision Diagnostic products assist healthcare professionals (“HCPs”) Find and Follow diseases, with a focus in cardiology. Our Radiopharmaceutical Oncology diagnostics and therapeutics help HCPs Find, Fight and Follow cancer.
We classify our products in three categories: Radiopharmaceutical Oncology, Precision Diagnostics, and Strategic Partnerships and Other Revenue. Our Radiopharmaceutical Oncology diagnostics and therapeutics help healthcare professionals (“HCPs”) Find, Fight and Follow cancer, with a focus on prostate cancer. Our leading Precision Diagnostic products assist HCPs to Find and Follow diseases, with a focus in cardiology.
We analyze various factors requiring management judgment when applying the five-step model to our contracts with customers. 72 Table of Contents Our product revenues are recorded at the net sales price (transaction price), which represents our sales price less estimates related to reserves which are established for items such as discounts, returns, rebates and allowances that may be provided for in certain contracts with our customers.
Our product revenues are recorded at the net sales price (transaction price), which represents our sales price less estimates related to reserves which are established for items such as discounts, returns, rebates and allowances that may be provided for in certain contracts with our customers.
Our ability to fund our future capital needs will be affected by our ability to continue to generate cash from operations and may be affected by our ability to access the capital markets, money markets or other sources of funding, as well as the capacity and terms of our financing arrangements.
Our ability to fund our future capital needs will be affected by our ability to continue to generate cash from operations and may be affected by our ability to access the capital markets, money markets or other sources of funding, as well as the capacity and terms of our financing arrangements. 71 Table of Contents We may from time to time repurchase or otherwise retire our debt and take other steps to reduce our debt or otherwise improve our balance sheet.
These amounts were offset by payments on long-term debt and other borrowings of $175.0 million, repurchase of common stock of $75.0 million and payments for minimum statutory tax withholding related to net share settlement of equity awards of $7.8 million.
These amounts were offset by payments on long-term debt and other borrowings of $175.0 million, repurchase of common stock of $75.0 million and payments for minimum statutory tax withholding related to net share settlement of equity awards of $7.8 million. External Sources of Liquidity In December 2022, we voluntarily repaid our 2019 $200.0 million five-year term loan facility.
We can give no assurance as to if or when or if any of these collaborations and other new initiatives, including our collaboration for flurpiridaz, will be successful or accretive to earnings. 64 Table of Contents Results of Operations The following is a summary of our consolidated results of operations: Year Ended December 31, 2022 vs. 2021 2021 vs. 2020 (in thousands) 2022 2021 2020 Change $ Change % Change $ Change % Revenues $ 935,061 $ 425,208 $ 339,410 $ 509,853 119.9 % $ 85,798 25.3 % Cost of goods sold 353,358 237,513 200,649 115,845 48.8 % 36,864 18.4 % Gross profit 581,703 187,695 138,761 394,008 209.9 % 48,934 35.3 % Operating expenses Sales and marketing 100,243 68,422 40,901 31,821 46.5 % 27,521 67.3 % General and administrative 133,584 150,395 69,270 (16,811) (11.2) % 81,125 117.1 % Research and development 311,681 44,966 32,788 266,715 593.1 % 12,178 37.1 % Total operating expenses 545,508 263,783 142,959 281,725 106.8 % 120,824 84.5 % Gain on sales of assets — 15,263 — (15,263) N/A 15,263 N/A Operating income (loss) 36,195 (60,825) (4,198) 97,020 (159.5) % (56,627) 1,348.9 % Interest expense 7,185 7,752 9,479 (567) (7.3) % (1,727) (18.2) % Loss (gain) on extinguishment of debt 588 (889) — 1,477 (166.1) % (889) N/A Other loss (income) 1,703 7,350 (2,198) (5,647) (76.8) % 9,548 (434.4) % Income (loss) before income taxes 26,719 (75,038) (11,479) 101,757 (135.6) % (63,559) 553.7 % Income tax (benefit) expense (1,348) (3,759) 1,994 2,411 (64.1) % (5,753) (288.5) % Net income (loss) $ 28,067 $ (71,279) $ (13,473) $ 99,346 (139.4) % $ (57,806) 429.1 % 65 Table of Contents Comparison of the Periods Ended December 31, 2022 and 2021 Revenues We classify our revenues into three product categories: Precision Diagnostics, Radiopharmaceutical Oncology, and Strategic Partnerships and Other Revenue.
We can give no assurance as to if or when or if any of these collaborations and other new initiatives, including our collaboration for flurpiridaz, will be successful or accretive to earnings. 65 Table of Contents Results of Operations The following is a summary of our consolidated results of operations: Year Ended December 31, 2023 vs. 2022 2022 vs. 2021 (in thousands) 2023 2022 2021 Change $ Change % Change $ Change % Revenues $ 1,296,429 $ 935,061 $ 425,208 $ 361,368 38.6 % $ 509,853 119.9 % Cost of goods sold 586,886 353,358 237,513 233,528 66.1 % 115,845 48.8 % Gross profit 709,543 581,703 187,695 127,840 22.0 % 394,008 209.9 % Operating expenses Sales and marketing 141,736 100,243 68,422 41,493 41.4 % 31,821 46.5 % General and administrative 125,458 133,584 150,395 (8,126) (6.1) % (16,811) (11.2) % Research and development 77,707 311,681 44,966 (233,974) (75.1) % 266,715 593.1 % Total operating expenses 344,901 545,508 263,783 (200,607) (36.8) % 281,725 106.8 % Gain on sales of assets — — 15,263 — N/A (15,263) N/A Operating income (loss) 364,642 36,195 (60,825) 328,447 907.4 % 97,020 (159.5) % Interest expense 20,019 7,185 7,752 12,834 178.6 % (567) (7.3) % Loss (gain) on extinguishment of debt — 588 (889) (588) (100.0) % 1,477 (166.1) % Other (income) loss, net (66,320) 1,703 7,350 (68,023) (3,994.3) % (5,647) (76.8) % Income (loss) before income taxes 410,943 26,719 (75,038) 384,224 1,438.0 % 101,757 (135.6) % Income tax expense (benefit) 84,282 (1,348) (3,759) 85,630 (6,352.4) % 2,411 (64.1) % Net income (loss) $ 326,661 $ 28,067 $ (71,279) $ 298,594 1,063.9 % $ 99,346 (139.4) % 66 Table of Contents Comparison of the Periods Ended December 31, 2023 and 2022 Revenues We classify our revenues into three product categories: Radiopharmaceutical Oncology, Precision Diagnostics, and Strategic Partnerships and Other Revenue.
This was primarily driven by a $37.7 million net reduction for the fair value adjustments to the contingent asset and liabilities. (refer to Note 4, “Fair Value of Financial Instruments”, for further details on contingent consideration liabilities, including CVRs) and a $9.5 million sublease impairment charge in the prior year period.
This was primarily driven by a $44.1 million net reduction for the fair value adjustments to the contingent asset and liabilities (refer to Note 4, “Fair Value of Financial Instruments”, for further details on contingent consideration liabilities, including CVRs) and an insurance settlement in 2023.
Given its physical characteristics, we believe DEFINITY RT is also well-suited for inclusion in kits requiring microbubbles for other indications and applications (including in kits developed by third parties of the type described in the paragraph entitled Microbubble Franchise below). 61 Table of Contents • VIALMIX RFID – DEFINITY is activated through the use of medical devices branded as VIALMIX and VIALMIX RFID.
Given its physical characteristics, we believe DEFINITY RT is also well-suited for inclusion in kits requiring microbubbles for other indications and applications (including in kits developed by third parties of the type described further in the paragraph entitled “Microbubble Franchise” below).
Patients in this study will be followed for one year after their first treatment for all efficacy endpoints and survival and safety data will be collected for an additional year. • We are also exploring additional lifecycle management opportunities for some of our current products.
Patients in this study will be followed for one year after their first treatment for all efficacy endpoints and survival and safety data will be collected for an additional year.
Research and development expenses increased $266.7 million for the year ended December 31, 2022 as compared to the prior year period.
Research and development expenses decreased $234.0 million for the year ended December 31, 2023 as compared to the prior year period.
Our IPR&D intangible assets include intangible assets acquired in a business combination that are used in research and development activities but have not yet reached technological feasibility, regardless of whether they have alternative future use.
Cash payments related to acquired IPR&D intangible assets are reflected as an investing cash flow in the Company's consolidated statement of cash flows. 75 Table of Contents Our IPR&D intangible assets include intangible assets acquired in a business combination that are used in research and development activities but have not yet reached technological feasibility, regardless of whether they have alternative future use.
As we continue to pursue expanding our microbubble franchise, our activities include: • Patents - We continue to actively pursue additional patents in connection with DEFINITY and DEFINITY RT, both in the U.S. and internationally. • DEFINITY RT - The formulation of DEFINITY that we have branded as DEFINITY RT became commercially available in the fourth quarter of 2021.
As we continue to grow our microbubble franchise, our activities include: • Patents - We continue to actively pursue additional patents in connection with DEFINITY and DEFINITY RT, both in the U.S. and internationally.
Incremental borrowings under the 2022 Revolving Facility may affect our ability to comply with the covenants including the financial covenants restricting consolidated net leverage and interest coverage. Accordingly, we may be limited in utilizing the full amount of our 2022 Revolving Facility as a source of liquidity.
Incremental borrowings under the 2022 Revolving Facility may affect our ability to comply with the covenants including the financial covenants restricting consolidated net leverage and interest coverage.
A prolonged disruption of service from one of our three Mo-99 processing sites or one of their main Mo-99-producing reactors could have a substantial negative effect on our business, results of operations, financial condition and cash flows. To augment our current supply of Mo-99, we have a strategic arrangement with SHINE Technologies LLC (“SHINE”) for the future supply of Mo-99.
A prolonged disruption of service from one of our three Mo-99 processing sites or one of their main Mo-99-producing reactors could have a negative effect on our business, results of operations, financial condition and cash flows. Inventory Supply & Third Party Suppliers We obtain a substantial portion of our imaging agents from third-party suppliers.
Strategic Partnerships and Other Revenue includes out-licensing arrangements, which includes $24.0 million of revenue recognized pursuant to the Novartis Agreement, partnerships that focus on facilitating precision medicine through the use of biomarkers, digital solutions and radiotherapeutic platforms, and on our other products, such as RELISTOR.
Strategic Partnerships and Other Revenue primarily includes out-licensing arrangements and partnerships that focus on facilitating precision medicine through the use of biomarkers, digital solutions and radiotherapeutic platforms.
Milestone payments made after regulatory approval are capitalized as an intangible asset and amortized over an estimated useful life of the product. Cash payments related to acquired IPR&D intangible assets are reflected as an investing cash flow in the Company's consolidated statement of cash flows.
Milestone payments made after regulatory approval are capitalized as an intangible asset and amortized over an estimated useful life of the product.
An analysis of the amount of, and change in, reserves is summarized as follows: (in thousands) Rebates and Allowances Balance, January 1, 2022 $ 10,977 Provision related to current period revenues 26,683 Adjustments relating to prior period revenues 70 Payments or credits made during the period (24,331) Balance, December 31, 2022 $ 13,399 Gross Profit The increase in gross profit for the year ended December 31, 2022, as compared to the prior year period, is primarily due to PYLARIFY sales volume and the $24.0 million pursuant to the Novartis Agreement, which is partially offset by amortization expense of acquired intangible assets in the Progenics Acquisition. 66 Table of Contents Sales and Marketing Sales and marketing expenses consist primarily of salaries and other related costs for personnel in field sales, marketing and customer service functions.
An analysis of the amount of, and change in, reserves for rebates and allowances is summarized as follows: (in thousands) Rebates and Allowances Balance, January 1, 2022 $ 10,977 Provision related to current period revenues 26,683 Adjustments relating to prior period revenues 70 Payments or credits made during the period (24,331) Balance, December 31, 2022 13,399 Provision related to current period revenues 32,308 Adjustments relating to prior period revenues (453) Payments or credits made during the period (29,184) Balance, December 31, 2023 $ 16,070 67 Table of Contents Gross Profit The increase in gross profit for the year ended December 31, 2023, as compared to the prior year period, is primarily due to increased PYLARIFY and DEFINITY sales volume and a RELISTOR milestone achievement, partially offset by the impairment of the AZEDRA currently marketed intangible asset, the Novartis licensing payment in the prior year, amortization of Cerveau intangible assets, and the loss of RELISTOR royalty revenue due to the sale of the asset.
Our business and financial performance have been, and continue to be, affected by the following: Continued Growth of PYLARIFY On May 27, 2021, we announced that the FDA had approved PYLARIFY, an F 18-labeled PET imaging agent targeting prostate-specific membrane antigen (“PSMA”). PYLARIFY is a product in our Radiopharmaceutical Oncology product category.
Our business and financial performance have been, and continue to be, affected by the following: Continued Growth of PYLARIFY PYLARIFY, an F 18-labeled PET imaging agent targeting PSMA, was approved by the FDA in May 2021 and commercially launched in the U.S. in June 2021.
As of December 31, 2022, these contingent payments were not expected to be payable due to the uncertainty around the timing of the future cash flows. Other Long-Term Liabilities Our other long-term liabilities in the consolidated balance sheet include the fair values of contingent consideration liabilities including contingent consideration liabilities related to a previous acquisition completed by Progenics in 2013.
As of December 31, 2023, these contingent payments were not expected to be payable within twelve months due to the uncertainty around the timing of the future cash flows. 73 Table of Contents Our other long-term liabilities in the consolidated balance sheet include unrecognized tax benefits and related interest and penalties.
Pursuant to the terms of the stock purchase agreement, the seller will also provide transition and clinical development services for a prescribed time following the closing of the transaction.
Pursuant to the terms of the stock purchase agreement for Cerveau, certain members of the Selling Stockholders will also provide transition and clinical development services for a prescribed time following the closing of the transaction. In September 2023, MK-6240 was granted Fast Track designation by the FDA.
The successful growth of PYLARIFY is also dependent on our ability to establish PYLARIFY as a leading PSMA PET imaging agent in a competitive environment in which other PSMA PET imaging agents have been approved and additional ones are in development. PYLARIFY’s competition is primarily two commercially available Ga-68-based PSMA imaging agents, as well as other non-PSMA-based imaging agents.
The successful growth of PYLARIFY is dependent on our ability to sustain PYLARIFY as the leading PSMA PET imaging agent in an increasingly competitive marketplace. PYLARIFY’s competition includes two commercially available gallium-68-based PSMA imaging agents, an approved fluorine-18-based PSMA imaging agent, and other non-PSMA-based imaging agents commonly referred to as conventional imaging.
We expect to make that payment during the first half of 2023. PYLARIFY AI Clearance and Use During 2021, we also announced that our subsidiary, EXINI, was granted 510(k) clearance by the FDA in the U.S. and received European Conformity Marking (“CE marking”) in Europe for aPROMISE.
PYLARIFY AI Use During 2021, we announced that EXINI was granted 510(k) clearance by the FDA in the U.S. and received CE marking in Europe for aPROMISE. We commercially launched aPROMISE under the name PYLARIFY AI in the U.S. in November 2021.
Our executive offices are located in Bedford, Massachusetts, with additional offices in North Billerica, Massachusetts, Somerset, New Jersey, Montreal, Canada and Lund, Sweden. Recent Developments Exclusive License for PNT2002 and PNT2003 On December 20, 2022, we announced the closing of a set of strategic collaborations with POINT Biopharma Global Inc.
Exclusive License for PNT2002 and PNT2003 On December 20, 2022, we announced the closing of a set of strategic collaborations with POINT Biopharma Global Inc.
We believe this facility will allow us to better manage DEFINITY manufacturing and inventory, reduce our costs in a potentially more price competitive environment, and provide us with supply chain redundancy. Radiopharmaceuticals are decaying radioisotopes with half-lives ranging from a few hours to several days.
On February 22, 2022, we received FDA approval of our supplemental new drug application authorizing commercial manufacturing of DEFINITY at our new facility. We believe this investment provides supply chain redundancy, improved flexibility and reduced costs in a potentially more price competitive environment. Radiopharmaceuticals are decaying radioisotopes with half-lives ranging from a few hours to several days.
Revenues are summarized by product category on a net basis as follows: Year Ended December 31, 2022 vs. 2021 (in thousands) 2022 2021 2020 Change $ Change % DEFINITY $ 244,993 $ 232,759 $ 195,865 $ 12,234 5.3 % TechneLite 88,864 91,293 84,945 (2,429) (2.7) % Other precision diagnostics 22,825 26,973 36,824 (4,148) (15.4) % Total precision diagnostics 356,682 351,025 317,634 5,657 1.6 % PYLARIFY 527,405 43,414 — 483,991 1,114.8 % Other radiopharmaceutical oncology 4,102 5,473 10,022 (1,371) (25.1) % Total radiopharmaceutical oncology 531,507 48,887 10,022 482,620 987.2 % Strategic Partnerships and other revenue 46,872 25,296 11,754 21,576 85.3 % Total revenues $ 935,061 $ 425,208 $ 339,410 $ 509,853 119.9 % The increase in revenues for the year ended December 31, 2022, as compared to the prior year period, is primarily driven by the commercial launch of PYLARIFY and $24.0 million of revenue recognized pursuant to the Novartis Agreement, and an increase in DEFINITY sales volume.
Revenues are summarized by product category on a net basis as follows: Year Ended December 31, 2023 vs. 2022 (in thousands) 2023 2022 2021 Change $ Change % PYLARIFY $ 851,303 $ 527,405 $ 43,414 $ 323,898 61.4 % Other radiopharmaceutical oncology 3,130 4,102 5,473 (972) (23.7) % Total radiopharmaceutical oncology 854,433 531,507 48,887 322,926 60.8 % DEFINITY 279,768 244,993 232,759 34,775 14.2 % TechneLite 87,370 88,864 91,293 (1,494) (1.7) % Other precision diagnostics 22,980 22,825 26,973 155 0.7 % Total precision diagnostics 390,118 356,682 351,025 33,436 9.4 % Strategic Partnerships and other revenue 51,878 46,872 25,296 5,006 10.7 % Total revenues $ 1,296,429 $ 935,061 $ 425,208 $ 361,368 38.6 % The increase in revenues for the year ended December 31, 2023, as compared to the prior year period, is primarily due to increased PYLARIFY and DEFINITY sales volume and RELISTOR milestone achievement of $15.0 million earned in the fourth quarter of 2023.
At this time, we are unable to make a reasonably reliable estimate of the timing of payments in individual years in connection with these tax liabilities. 71 Table of Contents Asset Retirement Obligation We are required to provide the Massachusetts Department of Public Health and the New Jersey Department of Environmental Protection financial assurance demonstrating our ability to fund the decommissioning of our North Billerica, Massachusetts and Somerset, New Jersey production facilities upon closure, although we have no current plans to close the facilities.
Asset Retirement Obligation We are required to provide the Massachusetts Department of Public Health and the New Jersey Department of Environmental Protection financial assurance demonstrating our ability to fund the decommissioning of our North Billerica, Massachusetts and Somerset, New Jersey production facilities, respectively, upon closure.
Continued Growth of DEFINITY As we continue to educate the physician and healthcare provider community about the benefits and risks of DEFINITY, we believe we will be able to continue to grow the appropriate use of DEFINITY in suboptimal echocardiograms.
Continued Growth of DEFINITY We believe we will be able to increase use of DEFINITY through continued education of physicians and healthcare providers about the benefits of ultrasound enhancing agents in suboptimal echocardiograms.
In a U.S. market with three echocardiography ultrasound enhancing agents approved by the FDA, we estimate that as of December 31, 2022, DEFINITY continued to hold over 80% of the market.
The U.S. market currently has three echocardiography ultrasound enhancing agents approved by the FDA; we estimate that DEFINITY will continue to hold at least an 80% share of the U.S. segment for ultrasound enhancing agents in echocardiography procedures.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeIntercompany transactions between entities that use different functional currencies also expose us to foreign currency risk. During the years ended December 31, 2022, 2021 and 2020, the net impact of foreign currency changes on transactions was a loss of $0.3 million for all years presented.
Biggest changeIntercompany transactions between entities that use different functional currencies also expose us to foreign currency risk. During the years ended December 31, 2023, 2022 and 2021, the net impact of foreign currency changes on transactions was a loss of less than $0.1 million, $0.3 million and $0.3 million, respectively.
Interest Rate Risk We are subject to interest rate risk in connection with our 2022 Revolving Facility, which is variable rate indebtedness. Interest rate changes could increase the amount of our interest payments and thus negatively impact our future earnings and cash flows. As of December 31, 2022, there was availability of $350.0 million on the 2022 Revolving Facility.
Interest Rate Risk We are subject to interest rate risk in connection with our 2022 Revolving Facility, which is variable rate indebtedness. Interest rate changes could increase the amount of our interest payments and thus negatively impact our future earnings and cash flows. As of December 31, 2023, there was availability of $350.0 million on the 2022 Revolving Facility.
At December 31, 2022, a hypothetical 10% change in value of the U.S. dollar relative to the Canadian dollar would not have materially affected our financial instruments. 74 Table of Contents
At December 31, 2023, a hypothetical 10% change in value of the U.S. dollar relative to the Canadian dollar would not have materially affected our financial instruments. 76 Table of Contents

Other LNTH 10-K year-over-year comparisons