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1} Adjusted Revenues, revenues at constant currency, Adjusted Gross Margin, Adjusted EBITDA and Adjusted EBITDA per share are non-GAAP measures and do not have any standardized meaning under GAAP. As a result, the information presented may not be comparable to similar measures presented by other companies. Refer to section Financial Results under Non-GAAP measures for additional details.

Subsequent to year-end

• In-licensed Onicit^® (palonosetron) for Mexico, Brazil, and select LATAM countries.

• Obtained regulatory approval for Pemazyre^® (pemigatinib) in Mexico.

• Submitted Tavalisse^® (fostamatinib disodium hexahydrate) for ANMAT approval in Argentina.

• Entered into an asset purchase agreement with Endo Operations Limited and Paladin Pharma Inc., to acquire the Paladin business for an upfront payment of $120,000, including inventory valued at $20,000. Furthermore, Knight may pay up to an additional US$15,000 upon achieving certain sales milestones. The transaction is expected to close in the middle of 2025.

• Up to March 10, 2025, the Company purchased additional 605,400 common shares through Knight's NCIB at an average purchase price of $5.53 for an aggregate cash consideration of $3,346.

“I am excited to announce that we have delivered another year of record-high revenues since the inception of Knight. We reported adjusted revenues¹ of over $365 million, a growth of 6%, and adjusted EBITDA¹ of approximately $58 million. Our key promoted products grew by 16% over the prior year and delivered a 3-year CAGR of more than 30%. We made significant progress in advancing and expanding our pipeline, with new products, multiple product submissions and approvals and three product launches. Subsequent to the year-end, we announced the acquisition of Paladin in Canada. The Paladin acquisition is synergistic, adds a profitable portfolio and critical mass and significantly increases the size of our business in Canada while bringing a stable source of cash flow that will help fund our growth in Canada and Latin American,” said Samira Sakhia, President and Chief Executive Officer of Knight Therapeutics Inc.

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¹ Adjusted revenues and adjusted EBITDA are non-GAAP measures and do not have any standardized meaning under GAAP. As a result, the information presented may not be comparable to similar measures presented by other companies. Refer to Section - Financial Results under Non-GAAP measures for additional details.

¹ A positive variance represents a positive impact to net income (loss) and a negative variance represents a negative impact to net income (loss).
² Percentage change is presented in absolute values.

Revenues: For the quarter ended December 31, 2024, revenues increased by $22,667 or 31% compared to the same period in prior year, of which $17,003 is explained by the Hyperinflation Impact¹. Excluding IAS 29, the increase was $5,664 or 6%, driven by the growth of our key promoted products partly offset by declines in our mature products and the depreciation of select LATAM currencies.

For the year ended December 31, 2024, revenues increased by $43,105 or 13% compared to the prior year, of which $20,831 is explained by the Hyperinflation Impact¹. Excluding IAS 29, the increase was $22,274 or 6%, and was driven by the growth of our key promoted products partly offset by declines of our mature products and the depreciation of select LATAM currencies.

The table below provides revenues by therapeutic areas.

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1} The Hyperinflation Impact is due to the application of IAS 29 in Argentina. Refer to Section - Hyperinflation for additional details.

The increase in revenues is explained by the following:

• Oncology/Hematology: For the quarter ended December 31, 2024, the oncology/hematology portfolio increased by $9,718 or 37%, of which $9,768 is due to the Hyperinflation Impact¹. Excluding IAS 29, the oncology/hematology portfolio decreased by $50. Revenues from our key promoted products increased by $5,781 or 42% on a constant currency² basis driven by the growth of Lenvima^®, Akynzeo^®, Trelstar^® and the launch of Minjuvi^® in Brazil. This growth was offset by a decline in our mature and branded generics products due to their lifecycle and the market entrance of new competitors.
  
  For the year ended December 31, 2024, the oncology/hematology portfolio increased by $26,211 or 23% of which $11,336 is due to the Hyperinflation Impact¹. Excluding IAS 29, the oncology/hematology portfolio increased by $14,875 or 12%. Our key promoted brands grew by $23,831 or 49% on a constant currency² basis driven by the growth of Lenvima^®, Akynzeo^®, Trelstar^® and the launch of Minjuvi^® in Brazil. This growth was partially offset by a decline in our mature and branded generics products due to their lifecycle and the market entrance of new competitors and the impact of LATAM currencies depreciation.
  
  Furthermore, in Q3-24, a competitor in Brazil launched both a branded generic and a generic of Lenvima^®. Knight and Eisai are collaborating to defend Lenvima^®’s market exclusivity in Brazil. While we continue to challenge the generic entrants, the introduction of generics and branded generics will increase competitive pressures and negatively impact future sales and margins of Lenvima^® in Brazil.

• Infectious Diseases: For the quarter ended December 31, 2024, the infectious diseases portfolio increased by $9,465 or 30%, of which $4,992 is due to the Hyperinflation Impact¹. Excluding IAS 29, the infectious diseases portfolio increased by $4,473 or 13% and $7,591 or 24% on constant currency² basis. The increase is driven by the purchasing patterns of certain customers and the growth of Cresemba^® across LATAM.
  
  For the year ended December 31, 2024, the infectious diseases portfolio increased by $14,324 or 10%, of which $5,797 is due to the Hyperinflation Impact¹. Excluding IAS 29, the infectious diseases portfolio increased by $8,527 or 6% and $12,617 or 9% on constant currency² basis driven by the growth of our key promoted products including Ambisome^® and Cresemba^®, partly offset by a decrease in the demand of Impavido^®. In 2024, the Company delivered $24,800 of Ambisome^® to the Ministry of Health of Brazil (“MOH”) compared to $25,200 in 2023.
  
  MOH Contract: The Company signed a contract with the MOH for Ambisome^® in December 2022 ("2022 MOH Contract"). Knight delivered a total of $34,600 under the 2022 MOH Contract as follows: $7,000 in 2022, $25,200 in 2023 ($2,400 in Q1-23, $18,000 in Q2-23 and $4,800 in Q4-23) and $2,400 Q1-24. In December 2023, Knight signed a second contract with the MOH ("2024 MOH Contract") and has delivered $22,400 under this contract in 2024 as follows: $6,800 in Q1-24, $8,900 in Q2-24, $6,700 in Q3-24. The total MOH sales Ambisome^® delivered in YTD-24 was $24,800. In January 2025, Knight signed a third contract with the MOH and it is expected that $22,400 will be delivered in 2025.

• Other Specialty: For the quarter ended December 31, 2024, the other specialty portfolio increased by $3,484 or 20%, of which $2,243 is due to the Hyperinflation Impact¹. Excluding IAS 29, the other specialty portfolio increased by $1,241 or 7% and $2,898 or 17% on constant currency² basis mainly driven by the launch of Imvexxy^® and Bijuva^® in Canada.
  
  For the year ended December 31, 2024, the other specialty portfolio increased by $2,570 or 3%, of which $3,698 is due to the Hyperinflation Impact¹. Excluding IAS 29, the other specialty portfolio decreased by $1,128 or 1%. On a constant currency² basis, revenues increased by $621 or 1% mainly driven by the launch of Imvexxy^® and Bijuva^® in Canada offset by a decline in revenues from our mature branded generics products due to their lifecycle.

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¹ The Hyperinflation Impact is due to the application of IAS 29 in Argentina. Refer to Section - Hyperinflation for additional details.
² Revenues at constant currency is a non-GAAP measure and does not have any standardized meaning under GAAP. As a result, the information presented may not be comparable to similar measures presented by other companies. Refer to Section - Financial Results under Non-GAAP measures for additional details.

Gross margin: For the quarter ended December 31, 2024, gross margin, as a percentage of revenues, was 42% compared to 46% in Q4-23. The decrease in the gross margin % is mainly explained by the Gross Margin Hyperinflation Impact¹. Excluding IAS 29, the Adjusted gross margin %² was 47% compared to 48% in Q4-23. There was no significant variance.

For the year ended December 31, 2024, gross margin, as a percentage of revenues, was 47% compared to 47% in YTD-23. There was no significant variance. Excluding IAS29, the Adjusted gross margin %² was 47% compared to 48% in YTD-23. There was no significant variance.

Selling and marketing (“S&M”) expenses: For the quarter ended December 31, 2024, selling and marketing increased by $3,760 or 35%, of which $4,181 is explained by the Hyperinflation Impact¹. The remaining variance was not significant.

For the year ended December 31, 2024, selling and marketing increased by $7,582 or 16%, of which $4,980 is explained by the Hyperinflation Impact¹. Excluding IAS 29, selling and marketing increased by $2,602 or 5%. The increase was mainly driven by the marketing spend for the launches of Minjuvi^® in Brazil, Imvexxy^® and Bijuva^® in Canada as well as pre-launch activities for Jornay PM™ in Canada.

General and administrative (“G&A”) expenses: For the quarter ended December 31, 2024, general and administrative increased by $2,632 or 32%, of which $1,809 is explained by the Hyperinflation Impact¹. The remaining variance was not significant.

For the year ended December 31, 2024, general and administrative increased by $8,074 or 22%, of which $2,624 is explained by the Hyperinflation Impact¹. Excluding IAS 29, general and administrative increased by $5,450 or 14%. The increase was mainly driven by structure and compensation expenses.

Research and development (“R&D”) expenses: For the quarter ended December 31, 2024, research and development expenses increased by $3,107 or 73%, of which $2,805 is explained by the Hyperinflation Impact¹. The remaining variance was not significant.

For the year ended December 31, 2024, research and development increased by $5,755 or 33%, of which $3,040 is explained by the Hyperinflation Impact¹. Excluding IAS 29, research and development increased by $2,715 or 14%. The increase was driven by product development activities in connection with our pipeline products and medical initiatives related to key promoted products. Knight invested $2,368 in 2024, an increase of $1,930 versus the prior year on its pipeline development activities. All costs related to development activities have been expensed which typically include regulatory submissions, analytical method transfers, stability studies and bioequivalence studies.

Impairment of non-current assets: In 2023, the impairment loss of $9,260 was mainly driven by Exelon^®. The book value of the intangible asset of Exelon^® is accounted in USD and revalued from USD to CAD at the end of every reporting period. The intangible of Exelon^® is carried in the functional currency of USD and as such the related intangible is revalued from USD to CAD at the end of every reporting period. The appreciation of the USD versus the CAD from the acquisition date of Exelon^® to the closing foreign exchange of 2023, has led to an increase in the value of the asset in CAD not offset by the cash flows projections, generating an impairment loss.

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¹ The Hyperinflation Impact and the Gross Margin Hyperinflation Impact are due to the application of IAS 29 in Argentina. Refer to Section - Hyperinflation for additional details.
² Revenues at constant currency and Adjusted gross margin % are non-GAAP measures and do not have any standardized meaning under GAAP. As a result, the information presented may not be comparable to similar measures presented by other companies. Refer to Section - Financial Results under Non-GAAP measures for additional details.

Net income (loss)
For the quarter ended December 31, 2024, the net income was $10,735 compared to net loss $24,326 for the same period in prior year. The variance mainly resulted from the above-mentioned items and (1) a net gain $8,317 on the revaluation of financial assets measured at fair value through profit or loss of versus a net loss of $7,878 in the same period in prior year, and (2) a foreign exchange gain of $1,740 in Q4-24 mainly driven by the depreciation of CAD vs USD, partially offset by losses on intercompany balances due to the depreciation of the BRL, compared to a foreign exchange loss of $9,007 in Q4-23 mainly driven by the unrealized losses due to the impact of the devaluation of the ARS on USD denominated payables held by Knight´s affiliate in Argentina and (3) income tax recovery of $2,860 in Q4-24 versus $1,826 in Q4-23.

For the year ended December 31, 2024, the net income was $4,332 compared to net loss $16,835 in prior year. The variance mainly resulted from the above-mentioned items and (1) a net loss of $11,435 on the revaluation of financial assets measured at fair value through profit or loss versus a net loss of $10,224 in prior year, (2) a foreign exchange loss of $4,194 in 2024, mainly driven by losses on intercompany balances due to the depreciation of the BRL and COP, compared to a foreign exchange loss of $15,169 in 2023, mainly driven by the the unrealized losses due to the impact of the devaluation of the ARS on USD denominated payables held by Knight´s affiliate in Argentina, offset by (3) a gain on hyperinflation of $9,226 versus $3,303 in prior year, and (4) income tax recovery of $2,280 in 2024 versus $5,153 in 2023.

Cash, cash equivalents and marketable securities: As at December 31, 2024, Knight had $142,331 in cash, cash equivalents and marketable securities, a decrease of $19,494 or 12% as compared to December 31, 2023. The decrease is due to investment activities of $29,830 mainly driven by certain licensing agreements, financing activities of $33,540 driven by our bank loans and NCIB offset by cash inflows from operations of $36,280 and foreign exchange gain on cash and marketable securities of $7,596.

Financial assets: As at December 31, 2024, financial assets were at $133,932, an increase of $5,563 or 4%, as compared to December 31, 2023, mainly driven by a net increase in the value of our financial assets. During Q4-24, the Company received distributions of $5,800 from our funds for certain contingent milestones which were previously not recorded on the balance sheet.

Accounts payable and accrued liabilities: As at December 31, 2024, accounts payable and accrued liabilities were at $83,173, a decrease of $7,444 or 8%, as compared to December 31, 2023, mainly driven by the timing of payments.

Bank Loans: As at December 31, 2024, bank loans were at $43,385, a decrease of $18,481 or 30%, as compared December 31, 2023 mainly due to principal repayments as well as the depreciation of the Brazilian Real, Mexican Peso and Colombian Peso.

"As at December 31, 2024, Knight had over $140 million in cash and marketable securities. After the close of the Paladin transaction, Knight will continue to generate healthy cash flows from its operations, as well as Paladin's, while maintaining a strong balance sheet. We will have additional borrowing capacity from which to execute future transactions and we will continue to monitor and manage efficiently our capital allocation strategy to drive long-term shareholder value," said Arvind Utchanah, Chief Financial Officer of Knight Therapeutics Inc.

Product Updates

Crexont^® (carbidopa/levodopa extended-release capsules)
Knight in-licensed Crexont^® for Canada and Latin America. Crexont^® is a novel, oral formulation of carbidopa/levodopa extended-release capsules designed for the treatment of Parkinson’s disease. The Company expects to submit Crexont^® in Canada in 2025 and continue with certain key LATAM countries.

Qelbree^® (viloxazine extended-release capsules)
Knight's submitted Qelbree^® for regulatory review to Health Canada. Qelbree^® is a novel nonstimulant medication for the treatment of Attention-Deficit Hyperactivity Disorder (ADHD).

Minjuvi^® (tafasitamab)
Knight obtained the regulatory approval in Mexico for Minjuvi^® in combination with lenalidomide followed by Minjuvi^® monotherapy for the treatment of adult patients with relapsed or refractory diffuse large B-cell lymphoma (DLBCL), who are not eligible for autologous stem cell transplantation (ASCT). The Company expects to launch Minjuvi^® in Mexico in March 2025. In addition, Knight expects to submit Minjuvi^® in combination with lenalidomide and rituximab followed by Minjuvi^® monotherapy for the treatment of patients with relapsed or refractory follicular lymphoma (FL) for regulatory approval in our key LATAM markets in 2025.

Pemazyre^® (pemigatinib)
Knight obtained the regulatory approval in Brazil and Mexico for Pemazyre^®, for the treatment of adults with locally advanced or metastatic cholangiocarcinoma with a FGFR2 fusion or rearrangement that have progressed after at least one prior line of systemic therapy.

Jornay PM^TM (methylphenidate HCI extended-release capsules)
Knight obtained regulatory approval in Canada for Jornay PM™, an extended-release formulation of methylphenidate, a stimulant medication for the treatment of Attention-Deficit Hyperactivity Disorder (ADHD) in children. The Company expects to launch Jornay PM™ in Canada in the second half of 2025

Tavalisse^® (fostamatinib disodium hexahydrate)
Knight received regulatory approval in Mexico for TAVALISSE^® for the treatment of thrombocytopenia in adult patients with chronic immune thrombocytopenia (ITP) who have had an insufficient response to a previous treatment.

Corporate Updates

Normal Course Issuer Bid

On July 11, 2024, the Company announced that the Toronto Stock Exchange approved its notice of intention to launch a NCIB (“2024 NCIB”). Under the terms of the 2024 NCIB, the Company may purchase for cancellation up to 5,312,846 common shares of the Company which represented 10% of its public float as at June 30, 2024. The 2024 NCIB commenced on July 15, 2024 and will end on the earlier of July 14, 2025 or when the Company completes its maximum purchases under the NCIB. Furthermore, the Company entered into an agreement with a broker to facilitate purchases of its common shares under the NCIB.

During the year ended December 31, 2024, the Company purchased 1,619,167¹ (2023: 11,125,288) common shares, of which 16,800 common shares, equivalent to $90 remains to be settled as at December 31, 2024, at an average price of $5.53 (2023: $4.82) for aggregate cash consideration of $8,956 (2023: $53,596).

Subsequent to year end up to March 10, 2025, the Company purchased additional 605,400 common shares at an average purchase price of $5.53 for an aggregate cash consideration of $3,346.

Subsequent event

On March 10, 2025, Knight entered into a definitive Asset Purchase Agreement with Endo Operations Limited and Paladin Pharma Inc. ("sellers"), to acquire the assets used by the sellers to conduct their international business which is mainly in Canada ("Paladin"). Upon closing, Knight will make an upfront payment of $120,000 in cash, including inventory valued at $20,000. In addition, Knight may pay future contingent payments of up to US$15,000 upon achieving certain sales milestones. The closing of the transaction is subject to the satisfaction of customary regulatory approvals including anti-trust clearance in Canada and is expected to occur in the middle of 2025. The acquisition of Paladin adds critical mass and expand the size of the Company´s business in Canada while adding a portfolio of cash flow generating products that will help fund Knights’ growth in Canada and Latin America.

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¹ Includes 1,413,506 common shares purchased under the 2024 NCIB. Therefore, as at December 31, 2024 there were 3,899,340 common shares remaining from the 2024 NCIB.

Financial Outlook¹

For fiscal 2025, Knight expects to generate between $390 million to $405 million in revenues and adjusted EBITDA to be approximately 13% of revenues. The decrease in our forecasted adjusted EBITDA as % of revenues compared to the prior year is driven by investments behind our 18 products both in our pipeline and recently launched. This includes launch spend behind Jornay PM™ in Canada and Minjuvi^® in Mexico as well as investments for advancing our pipeline through development, submission and pre-launch across our territories. The guidance includes the revenues and adjusted EBITDA that the expects to generate upon the close of the Paladin transaction in the middle of 2025. The guidance is based on a number of assumptions, including but not limited to the following:

• closing of the Paladin transaction in the middle of 2025

• no material impact on revenues due to the application of hyperinflation accounting for Argentina

• no revenues for business development transactions not completed as at March 19, 2025

• no unforeseen termination to our license, distribution & supply agreements

• no interruptions in supply whether due to global supply chain disruptions or general manufacturing issues

• no new generic entrants on our key pharmaceutical brands

• no unforeseen changes to government mandated pricing regulations

• successful commercial execution on product listing arrangements with HMOs, insurers, key accounts, and public payers

• successful execution and uptake of newly launched products

• no material increase in provisions for inventory or trade receivables

• no significant variations of forecasted foreign currency exchange rates

• inflation remaining within forecasted ranges

Should any of the assumptions differ, the financial outlook and the actual results may vary materially. Refer to the risks and assumptions referred to in the Forward-Looking Statements section of this news release for further details.

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1} This forward looking information is based on assumptions specific to the nature of the Company’s activities with regard to annual revenue growth considering industry information, expected market share, pricing assumptions, actions of competitors, sales erosion rates after the end of patent or other intellectual property rights protection, the timing of the entry of generic competition, the expected results of tenders, among other variables.

Conference Call Notice 

Knight will host a conference call and audio webcast to discuss its fourth quarter and year ended December 31, 2024, today at 8:30 am ET. Knight cordially invites all interested parties to participate in this call.

Date: Thursday, March 20, 2025
Time: 8:30 a.m. ET
Telephone: Toll Free: 1-888-699-1199 or International 1-416-945-7677
Webcast: www.knighttx.com or Webcast
This is a listen-only audio webcast. Media Player is required to listen to the broadcast.

Replay: An archived replay will be available for 30 days at www.knighttx.com

About Knight Therapeutics Inc. 

Knight Therapeutics Inc., headquartered in Montreal, Canada, is a specialty pharmaceutical company focused on acquiring or in-licensing and commercializing pharmaceutical products for Canada and Latin America. Knight's Latin American subsidiaries operate under United Medical, Biotoscana Farma and Laboratorio LKM. Knight Therapeutics Inc.'s shares trade on TSX under the symbol GUD. For more information about Knight Therapeutics Inc., please visit the company's web site at www.knighttx.com or www.sedarplus.ca.

Forward-Looking Statement

This document contains forward-looking statements for Knight Therapeutics Inc. and its subsidiaries. These forward-looking statements, by their nature, necessarily involve risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements. Knight Therapeutics Inc. considers the assumptions on which these forward-looking statements are based to be reasonable at the time they were prepared but cautions the reader that these assumptions regarding future events, many of which are beyond the control of Knight Therapeutics Inc. and its subsidiaries, may ultimately prove to be incorrect. Factors and risks, which could cause actual results to differ materially from current expectations are discussed in Knight Therapeutics Inc.'s Annual Report and in Knight Therapeutics Inc.'s Annual Information Form for the year ended December 31, 2024 as filed on www.sedarplus.ca. Knight Therapeutics Inc. disclaims any intention or obligation to update or revise any forward-looking statements whether because of new information or future events, except as required by law.

CONTACT INFORMATION:

HYPERINFLATION

The Company applies IAS 29, Financial Reporting in Hyperinflation Economies, as the Company’s Argentine subsidiaries use the Argentine Peso as their functional currency. IAS 29 requires that the financial statements of an entity whose functional currency is the currency of a hyperinflationary economy be adjusted based on an appropriate general price index to express the effects of inflation. After applying for the effects of hyperinflation, the statement of income (loss) is converted using the closing foreign exchange rate of the month.

Revenues & operating expenses in the local currency, i.e. ARS, are restated from the month of the sales or the month in which the expense was incurred to the end of the reporting period using the inflation index during that period. The restatement calculation is performed on a year to date basis based on IAS29 ("Inflation Adjusted Figures"). For the years ended December 31, 2024 and 2023, the Company applied the following inflation index for the restatement of each respective month.

Under IAS 29, the translation from the local currency, to the reporting currency is performed on the Inflation Adjusted Figures using the end of period rate at the reporting date. The Inflation Adjusted Figures were converted to the CAD using the following quarter-end closing rates for each of the respective periods.

¹ Depreciation of ARS vs CAD during each period, calculated as follows: (End of period rate - Beginning of period rate) / Beginning of period rate.

In 2024 the inflation index used for the hyperinflation adjustment on revenues and operating expenses of the Company's subsidiaries in Argentina was higher than the ARS depreciation in the same period. For example, the revenues and operating expenses generated or incurred in January 2024 were restated by applying an inflation index of 81% while the ARS to CAD depreciated by only 17% in 2024. Consequently, this resulted in higher revenues and operating expenses reported under IAS 29 in CAD. Conversely in 2023, the inflation index was lower than the ARS depreciation which resulted in lower revenues and operating expenses reported under IAS 29 in CAD. As such, the hyperinflation accounting under IAS 29 resulted in an inflated variance in the reported revenues and operating expenses of the Company's subsidiaries in Argentina in CAD in both Q4-2024 and 2024 when compared to the same prior year periods ("Hyperinflation Impact").

Under hyperinflation accounting, the cost of goods sold in the local currency, i.e. ARS, are restated using the inflation index from the purchase date to the end of the reporting period. The restatement calculation is performed on a year-to-date basis based on IAS29 ("Cost of goods sold adjusted Figures").

Under IAS 29, the Cost of goods sold adjusted Figures were converted to CAD using the quarter-end closing rates of the respective periods. In 2024 the inflation index used for the hyperinflation adjustment over cost of goods sold of the Company´s subsidiaries in Argentina were higher than the ARS depreciation in the same period. Therefore this led to higher cost of goods sold reported under IAS 29 in CAD and consequently a lower gross margin. Conversely, in 2023, the inflation index was lower than the ARS depreciation which resulted in lower cost of goods sold and consequently higher gross margin. As such, the hyperinflation accounting under IAS 29 resulted in an inflated variance in the reported cost of goods sold and a decrease in the gross margin related to Company´s subsidiaries in Argentina in CAD in both Q4-2024 and 2024 compared to the same prior year periods ("Gross Margin Hyperinflation Impact").

FINANCIAL RESULTS UNDER NON-GAAP MEASURES
[In thousands of Canadian dollars]

The Company discloses non-GAAP measures and ratios that do not have standardized meanings prescribed by IFRS. The Company believes that shareholders, investment analysts and other readers find such measures helpful in understanding the Company’s financial performance. Non-GAAP financial measures and adjusted EBITDA per share ratio do not have any standardized meaning prescribed by IFRS and may not have been calculated in the same way as similarly named financial measures presented by other companies. The Company uses the following non-GAAP measures.

[i] Financial results excluding the impact of hyperinflation under IAS 29

The Company applies IAS 29, Financial Reporting in Hyperinflation Economies, as the Company's Argentine subsidiaries used the Argentine Peso as their functional currency. IAS 29 requires that the financial statements of an entity whose functional currency is the currency of a hyperinflationary economy be adjusted based on an appropriate general price index to express the effects of inflation.

Financial results under IFRS are adjusted to remove the impact of hyperinflation under IAS 29. The impact of hyperinflation under IAS 29 is calculated by applying an appropriate general price index to express the effects of inflation. After applying the effects of translation, the statement of income is converted using the closing foreign exchange rate of the month.

The Company believes that financial results excluding the impact of hyperinflation under IAS 29 represents a useful measure to investors as allow results to be viewed without the impact of IAS 29, thereby facilitating the comparison of results period over period. The presentation of financial results excluding the impact of hyperinflation under IAS 29 is considered to be a non-GAAP measure and does not have any standardized meaning under GAAP. As a result, the information presented may not be comparable to similar measures presented by other companies.

The following tables are reconciliations of financial results under IFRS to financial results excluding the impact of hyperinflation under IAS 29.

Select financial results excluding the impact of hyperinflation under IAS 29¹

¹ Adjusted EBITDA and financial results excluding the impact of IAS 29 are non-GAAP measures and do not have any standardized meaning under GAAP. As a result, the information presented may not be comparable to similar measures presented by other companies.

Adjusted Revenues¹ by Therapeutic Area

[ii] Financial results at constant currency

Financial results at constant currency are obtained by translating the prior period revenues and financial results from the functional currencies to CAD using the conversion rates in effect during the current period. Furthermore, with respect to Argentina, the Company excludes the impact of hyperinflation and translates the revenues and results at the average exchange rate in effect for each of the periods.

The Company believes that financial results at constant currency represents a useful measure to investors because it eliminates the effect that foreign currency exchange rate fluctuations may have on period-to-period comparability given the volatility in foreign currency exchange markets and therefore, provides greater transparency to the underlying performance of our consolidated financial results. The presentation of revenues and financial results under constant currency is considered to be a non-GAAP measure and does not have any standardized meaning under GAAP. As a result, the information presented may not be comparable to similar measures presented by other companies.

The following tables are reconciliations of financial results under IFRS to financial results and financial results at constant currency.

Select financial results at Constant Currency¹

¹ Adjusted EBITDA and financial results at constant currency are a non-GAAP measures and do not have any standardized meaning under GAAP. As a result, the information presented may not be comparable to similar measures presented by other companies.

Revenues at Constant Currency¹ by Therapeutic Area

[iii] Adjusted Gross Margin
Adjusted Gross Margin is defined as revenues less cost of goods sold, excluding the impact of hyperinflation under IAS 29.

The Company believes that Adjusted Gross Margin represents a useful measure to investors as allow Gross Margin to be viewed without the impact of hyperinflation under IAS 29, thereby facilitating the comparison period over period. The presentation of Adjusted Gross Margin is considered to be a non-GAAP measure and does not have any standardized meaning under GAAP. As a result, the information presented may not be comparable to similar measures presented by other companies.

[iv] EBITDA

EBITDA is defined as operating income or loss adjusted to exclude amortization and impairment of non-current assets, depreciation, but to include costs related to leases.

The Company believes that EBITDA represents a useful measure to investors to assess profitability and measure the Company's ability to generate liquidity through operating activities. The presentation of EBITDA is considered to be a non-GAAP measure and does not have any standardized meaning under GAAP. As a result, the information presented may not be comparable to similar measures presented by other companies.

[v] Adjusted EBITDA

Adjusted EBITDA is defined as EBITDA adjusted for the impact of IAS 29 (accounting under hyperinflation), acquisition costs and non-recurring expenses. The Company believes that Adjusted EBITDA represents a useful measure to investors to assess profitability and measure the Company's ability to generate liquidity through operating activities.

The Company believes that Adjusted EBITDA represents a useful measure to investors to assess profitability and measure the Company's ability to generate liquidity through operating activities, without the impact of hyperinflation under IAS 29, thereby facilitating the comparison period over period. The presentation of adjusted EBITDA is considered to be a non-GAAP measure and does not have any standardized meaning under GAAP. As a result, the information presented may not be comparable to similar measures presented by other companies.

The following table is a reconciliation of operating income (loss) to EBITDA and adjusted EBITDA:

For the quarter ended December 31, 2024, adjusted EBITDA increased by $2,939 or 24%. The increase was driven by higher adjusted gross margin.

For the year ended December 31, 2024, adjusted EBITDA decreased by $2,292 or 4%. The decrease was driven by higher marketing spend for the launches of Minjuvi^® in Brazil, Imvexxy^® and Bijuva^® in Canada as well as pre-launch activities for Jornay PM™, higher general and administrative expenses mainly related to structure and compensation expenses and an increase in research and development expenses driven by product development activities in connection with our pipeline products and medical initiatives related to key promoted products, partly offset by higher adjusted revenues and corresponding adjusted gross margin.

Explanation of adjustments from EBITDA to Adjusted EBITDA

[vi] Adjusted EBITDA per share

Adjusted EBITDA per share is defined as Adjusted EBITDA over number of common shares outstanding at the end of the respective period.

The Company believes that Adjusted EBITDA per share represents a useful measure to investors to assess profitability and measure the Company's ability to generate liquidity through operating activities on a per common share basis, without the impact of hyperinflation under IAS 29, thereby facilitating the comparison period over period. The presentation of adjusted EBITDA per share is considered to be a non-GAAP ratio and does not have any standardized meaning under GAAP. As a result, the information presented may not be comparable to similar measures presented by other companies.

The Company calculated adjusted EBITDA per share as follows: